🔑 He made 29% a year. Steal his strategies.
Welcome to The Business Buying Academy with Sieva Kozinsky. Here's what we have in store for you today:
- How to make 29% a year for over a decade
- Never miss another state filing deadline
- A Masterclass on Rollups
Imagine having to log into 50+ different bank portals every day.
That used to be the life of Nick, our Director of Finance.
Then we found Vesto. It pulls in every account-across every bank-into one dashboard. Real-time balances, cash flow, transactions. No more jumping between logins.
Now Nick handles it all in under 5 minutes. That means more time spent on cash strategy, less on admin.
(Thanks to Vesto for sponsoring this newsletter.)
Copy these strategies if you want to get rich.
When it comes to investing legends, few names are as revered as Peter Lynch.
He's the famed manager of Fidelity’s Magellan Fund, which delivered an astonishing 29.2% annualized return from 1977 to 1990. That would mean an $100k investment turned into $2,800,000.
He invested in large public companies and beat the market consistently during his time as a portfolio manager.
His returns are phenomenal, but his strategy was relatively simple.
Go for a business that any idiot can run - because sooner or later, any idiot probably is going to run it.
- Peter Lynch
Even if you invest in private companies, like many reading this newsletter, you can learn a lot from Peter.
I read his book, One Up on Wall Street, to learn about his investing philosophy. Here are the main takeaways:
Invest in What You Know
Peter advocates for investing in companies you understand, including the businesses you encounter in daily life or through your expertise.
He spotted winners like Dunkin’ Donuts or Hanes by observing consumer behavior or talking to people in his network - or even by asking his teenage children which stores and brands were popular at school.
Peter says to create a “circle of competence” map. List industries where you have unique insights, then focus your acquisition or growth strategies there. Avoid chasing “hot” sectors outside your expertise.
Embrace the “Boring” and Undervalued
Peter Lynch loved “boring” companies, especially ones that other analysts weren't paying attention to. These businesses were often undervalued, offering huge upside when their potential was realized.
If you've followed me for a while, you know that's my exact philosophy. I avoid looking at AI companies (or whatever happens to be hot at the moment), and instead focus on the 'boring' businesses with great margins.
Look for Tenbaggers
The book references the term "tenbaggers" repeatedly (meaning a stock that produces a 10x (1,000%) return.)
It's the Holy Grail for public company investors. A couple of tenbaggers can make your entire career.
But the takeaway is that you need to look at investments with enough meat on the bone. Don't just go for small gains.
Ask yourself, can this business potentially be a 10x return? Of course you'll never know for sure, but asymmetric bets with huge upside and limited downside potential are the sweet spot.
Takeaways:
- Don't venture outside your circle of competence
- Favor boring investments that others overlook
- Limit downside while chasing high upside potential
🔑 One of the most annoying problems for holding companies
The more companies I've bought, the more annoying legal entity compliance has gotten.
Just tracking the legal entities and all the state deadlines is a headache.
I expected my Registered Agent to help, but they only seemed to be good at sending me invoices.
Then I found Discern. It's a software company that replaces your Registered Agent and automates your state filings, like annual reports and franchise taxes. I see all my legal entities in one portal, and can file things directly from the product.
I never miss a filing and spend minutes on it a year.
Check out Discern here
Thanks to Discern for sponsoring today's newsletter
🔑 Learn to Buy Businesses (this is a masterclass on M&A, Rollups, and Negotiating)
I chatted with Brian Wolfe, an expert on M&A from all levels: he worked as a partner at a big law firm for 17 years, helping to close huge deals.
Now he's buying businesses himself - including a rollup of 3 software businesses that he sold to private equity. He even bought one of them for 100% seller financing with some clever negotiating tactics.
This interview is a masterclass on buying businesses.
Have a great day,
Sieva
P.S. - Are you hiring? Get started with top global talent from Somewhere (I'm a customer and investor)
Disclaimer: nothing here is investment advice. Please do your own research. The information above is just for information and learning.
