An investor with 11 years of operating experience argues that the operator matters far more than the deal itself. A strong operator can save a mediocre deal, but a weak operator will destroy a good one. Experience, resources, and resilience matter most over the next five to ten years.
Chapters
This is what I believe because I believe that you can have a really good deal and a crappy operator and they could totally tank the deal and you could have a really amazing operator in a so so deal and they know how to literally turn it around. So let's talk about that.
Yeah, and I think when people are talking about like investing in deals, some people say, well, you should put like 50% of your decision making on the deal and then you should put your other 50% on the operator. Because of a good operator can take a good, a bad deal and make it perform well. Bad operator can take an excellent deal and run it into the ground. And so but I actually think that you should put at least 80% or more of your decision making on the actual operator themselves. There's a lot of deals out there. A lot of people can have a good deal. You want to have confidence they can actually handle the challenges. And believe me, I've been operating for 11 years now. I can tell you there are a lot of challenges. There are a lot of things that pop up through the hold periods that you'd be like, wow, you get a little bit shocked and taken back. And if you don't have things built in and you don't have the experience and the resources and the contacts to be able to solve a lot of these problems, especially in today's market, good deals could turn bad really quickly. And so you want to have an operator who has a lot of experience and someone who has the resilience to be able to handle rapid change and a lot of challenges. Because I think we're just going to see, see if anything, I'm predicting that we're going to see a lot of rapid change at least in the next five to ten years.
