Good morning!
Here are today’s highlights:
In our latest Dashboard, Jared Bell explains how he found a growth strategy hiding in his supply chain.
The plumbing industry may need a better PR strategy to solve its labor shortage.
A plan to AI-proof the American workforce is gaining bipartisan support.
Is it possible to sell an unprofitable business? Yes, if you have clear eyes and reasonable expectations.
PRIVATE EQUITY
Nick Bradley says PE firms are moving toward a new model, one business owners shouldn’t dismiss: “I spent a long time inside the world of private equity. The deal committees, the value creation planning, the rooms where offers were structured, terms were set, and yes, sometimes where decisions were made that I wasn’t proud of. I know intimately what happens in those rooms, for good and for bad, which is precisely why I eventually walked away from them. And it’s also why I’m going back in, on very different terms, because I think the version of PE that so many founders are afraid of is being replaced by something considerably more interesting, and I’d rather be part of building that than watching it from the outside.”
“Some funds are already there. They bring genuine operating expertise, they care about the people inside the businesses they buy, they think in terms of what a company can become rather than what it can be stripped to. Those are the funds worth knowing about, and there are more of them than the dinner-party horror stories would have you believe.”
“What I’ve spent the years since then doing is helping founders understand the PE world from the inside. Not to make them afraid of it, but to make them literate in it. Because the knowledge asymmetry in most deal processes is extraordinary. A PE firm has done this hundreds of times. The founder is usually doing it once. The firm has lawyers, advisors, modellers, operating partners, deal experience going back decades. The founder has their accountant and whatever they’ve managed to learn in the months since they decided to explore a sale.”
“At its best, private equity is one of the most powerful tools a founder can access. That version exists. It needs to be the norm, not the exception. That’s what I came back to work on.” READ MORE
THE 21 HATS PODCAST: DASHBOARD
The Growth Strategy Hiding in Your Supply Chain: Jared Bell never planned to own a fencing business. He took a summer job at Butte Fence in 1994, liked the work, and decided to skip college and stay. Thirteen years later, he bought out a partner and took over day-to-day operations—just in time for the Great Recession. The company survived that challenge and has gone on to thrive, but not by following a conventional growth playbook. Bell has expanded the business by repeatedly asking a simple question: Why buy from a supplier when we can do it better ourselves? Over the years, Butte Fence has developed new products, configured more efficient processes, and steadily moved upstream, turning vendors into competitors and creating entirely new businesses along the way. In our conversation, Bell explains how that strategy evolved, what it takes to pull it off, and how a small business can identify opportunities hiding in its own supply chain.
You can subscribe to the 21 Hats Podcast—brought to you by Grasshopper Bank—wherever you get podcasts.
