Good morning!
Here are today’s highlights:
On our latest Dashboard, we meet a holding company that is buying small businesses—but not to flip them.
Our friends at Simple Numbers have introduced an index to show how the entrepreneurial economy is performing.
President Trump is trying a new approach to reinstate his tariffs.
Rob Levin warns against hiring that corporate refugee with the perfect resume.
EDITOR’S NOTE
As I announced on Sunday, I’ve experimented this past week with publishing the Morning Report on Tuesday and Friday. Next week, I’m going to try publishing Monday, Wednesday, and Friday. As always, I welcome any and all feedback.
ARTIFICIAL INTELLIGENCE
Ami Kassar thought he knew his business—until AI proved him wrong: “Every quarter, the Small Business Administration publishes data on its loan portfolio. The agency recently expanded those reports, creating a much richer dataset. For the first time, I finally had enough information to explore questions I’d been asking for years. That said, the dataset contained nearly a million rows of information. Not long ago, analyzing something that large would have required consultants, databases, and a major investment of time and money. Instead, I uploaded the data into Claude. I isolated the loans my company originated and matched them to referral sources and channels. Then I started looking for patterns.”
“What I found surprised me. One referral source I always considered strong was producing loans that performed worse than the rest of our portfolio. At the same time, one of our direct-marketing channels performed better than I expected. Many in my industry assume these channels produce weaker borrowers. That’s what I’d always believed.”
“The analysis has already influenced how we think about our business. We’ll spend more time evaluating referral relationships. We’ll pay closer attention to performance trends. Some decisions may reduce our loan volume—and thus our revenue—in the short term. But if you build a business that you want to last forever, you are willing to sacrifice some short-term profits for long-term health.”
“In my business, this means building the healthiest portfolio of borrowers possible—while understanding there will always be some loans that go bad.” READ MORE
Here’s how business owners are using OpenClaw: “When [Sean] Chuplis heard about OpenClaw, he created seven agents to manage his business [which sells a device, the Stratux, that collects real-time information about air traffic and weather for small-plane pilots]. One answers customer questions on his Discord forum, while others fulfill orders or do online research to write posts for his aviation blog. One manages his Amazon account, processing refunds, analyzing which keyword searches are leading people to find the Stratux and then buying keyword ads. ‘It’s actually changing my campaigns and modifying bids,’ Chuplis told me. ‘It’s spending real money.’”
“Managing his business used to take 20 hours of his time every month; a year ago he was considering selling it because he was too busy at his day job. But now he spends barely an hour or so a week on it. He let go of the contractor he used to pay to manage his Amazon activity.”
“He has been occasionally surprised — in a pleasant way — by the agents’ actions. One day, his marketing agent, which monitors industry news for him, spoke up to say it had read an article about the ‘right to repair’ movement. It proposed a blog post about how Chuplis’s product is very fixable, because its software is open-source and he sells replacement parts.”
“Chuplis had never really thought about the issue, he says, until the agent brought it up and wrote the post for him. Another day, a customer wrote to express a wish that the Stratux include a software feature specific to gliders. The agent looked at the device’s computer code, wrote the new feature itself and sent it to Chuplis.” READ MORE
THE 21 HATS PODCAST: DASHBOARD
A Buyer That Doesn’t Want to Flip Your Business: Sean Joy is head of M&A at Chenmark, a Portland, Maine-based holding company that acquires a handful of small businesses each year. At first glance, Chenmark may sound like a traditional private equity firm, but it isn’t. The company is family- and employee-owned, and when it buys a business, the goal isn’t to improve it and sell it a few years later. The goal is to own it indefinitely.
In our conversation, Sean explains what Chenmark looks for in an acquisition, how it finds businesses to buy, what it’s willing to pay, and how it approaches management after a deal closes. For owners thinking about succession, Chenmark offers a different path—one that sits somewhere between selling to private equity, selling to employees, or passing the business on to the next generation.
You can subscribe to the 21 Hats Podcast—brought to you by Grasshopper Bank—wherever you get podcasts.
