A portfolio operator who recently sold multiple businesses at high valuations explains why he treats deals like marriages: you need to commit for 3 to 10 years because exiting is hard. He scouts for new acquisitions now but runs small experiments first to test if a direction is worth the long-term bet.
That's the struggle, right? It's like sometimes there's just so many good ideas and it's like you have to stay locked in. That's right. Otherwise, it's just like you end up going all over the place. So how do you stay disciplined?
I don't think— you don't see me talk a lot about our companies that we own online besides Contrarian Thinking. We have a portfolio of boring businesses. I've actually sold a lot of them lately just into this market. We had crazy valuations. And so then I had to ask myself, well, if I'm going to sell all these, what are we going to do with the cash? Where does this go next? And the answer right now is that I think that we're in for a little bit more pain. So I'm kind of looking for what our next acquisition targets are going to be. So I try to think about deals and revenue lines and business decisions I need to make like mini marriages. They're really easy to get into. They're kind of a bitch to get out of. You want to make sure that you want to stay into whatever you're going to do for 3 to 5 to 10 years, right? I don't always do that. You'll see me take a few really tiny risk trades to see if I want to do it.
