What business age/history does the speaker prefer when buying businesses?

Codie SanchezFounder @ Contrarian Thinking

How to make billions through boring businesses #shorts

21 Jun 2022 · 1 min

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0:37

Codie Sanchez (creator) explains her approach to building large returns by buying established, non-glamorous businesses. She describes the "limby effect": the longer a business has been around, the likelier it is to persist, and says she targets firms with multi-year track records (examples: trucking, real estate investments, plumbing). Her thesis: essential services survive downturns, creating predictable revenue streams.

Questions this video answers

Businesses with 5, 10, 15 year history (multi-year track records).

Chapters

If you want to know how to make billions buying boring businesses, I can tell you what I did. The truth of the matter is, everybody's into the hot new thing. The best tech startup, the hottest stock. But how did that turn out for me? I'm always nervous about the young hot thing in the business world. I operate on something called the limby effect. Essentially, it means that the longer something has been around, the more likely it is to continue to survive. Most of the businesses I buy have 5, 10, 15 year history in the industries that they're in. They're boring. Trucking companies, real estate investments plan, plumbing companies. Because no matter what happens to the economy, if your toilet gets busted, I think you're gonna fix it, and you're gonna have to pay my companies to do it. And that's how I know how to find businesses to buy.