Codie SanchezFounder @ Contrarian Thinking

Cashflow loves ugly

17 Feb 2026 · 1 min

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Codie Sanchez argues investors should buy "ugly" businesses in dirty service sectors like plumbing and waste cleaning instead of flashy tech startups. These overlooked industries trade at a "grime discount," generate steady cash flow, and make up roughly 60% of all businesses. They're resilient, low-competition, and far less risky than fragile high-growth ventures.

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What type of business would I never buy in 2026? I call this the ugly business versus the butterfly business. I only buy ugly businesses. These guys, you find them where nobody wants to look. Under rocks, in the rock, in the dirt. And I'll explain what I'll never buy. Most people, they're looking for what I call the butterfly business, the shiny tech startup or the AI app. Please don't buy one of those because butterflies, they're flashy but they're fragile. They do not cash flow. Ugly businesses like these millipedes, they're not sought after. They have what I call the grime discount which you going to be able to see if it's dirty, dull or dangerous. We like to buy them at a discount because that's where the money is. So don't get caught up in the businesses that are flashy. 60% of businesses operate in dirty service industries. My favorites, Waste cleaning, maintenance, repair, plumbing. Because the dirtier the industry, the less competition there is to buy it. The more like a millipede, the less risky the move. You get paid to get your hands dirty. So stop chasing butterflies. Start turning over rocks.