Dec 19, 2024 · 1h 33m · founders
Breakfast with Brad Jacobs + How To Make A Few Billion Dollars
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In this episode, David Senra breaks down the core operating principles and mental models of serial entrepreneur Brad Jacobs, drawing from an intensive private breakfast meeting and Jacobs' autobiography, How to Make a Few Billion Dollars. Through historical case studies and actionable lessons, Senra illustrates how extreme talent density, exhaustive industry research, technological innovation, and psychological resilience enable founders to build compounding, multi-billion-dollar enterprises.
Statements from this episode (21)
Brad Jacobs built eight multi-billion-dollar businesses and completed over 500 acquisitions
“He has started eight different billion dollar or multi-billion dollar businesses. He's done over 500 acquisitions. He's raised over thirty billion dollars.”
Jared Kushner invested in Brad Jacobs' latest company and joined its board
“My friend, Jared Kushner just invested in Brad's latest company and joined his board.”
An empty seat is less damaging than hiring a poor fit
“He says an empty seat. Is less damaging than a poor fit.”
Slightly understaffed teams are more focused and avoid redundant busywork
“He says, I find that slightly understaffed teams are more focused and spend less time doing redundant busy work.”
Saving $100K on executive pay risks millions in lost profits
“He says it makes no financial sense to skimp on salary and incentives to save a 100,000 dollars a year. When hiring a second best candidate may cost you millions of dollars in lost profit.”
Getting the macro trend right allows room for operational mistakes
“You can mess up a lot of things in business and still do well as long as you get the big trend right.”
Charlie Munger and Sam Zell gained followings by embracing their eccentricities
“Both Munger and Zell were exactly that way. They did not try to hide their eccentricities. They embrace them. And that's part of the reason that they had such a cult-like following.”
United Rentals stock delivered over 100x returns since its $3.50 inception
“United Rental Stock is a hundred bagger. The share price at inception was three dollars and 50 cents, and it now trades at more than a hundred times that price.”
XPO Logistics was the seventh best-performing Fortune 500 stock last decade
“XPO was the seventh best performing stock in the Fortune 500 of the last decade.”
Brad Jacobs attributes his best business decisions to fifty years of meditation
“He's been meditating, I think, for over 50 years, and as he says right here in the book, he feels it's been a huge benefit to his career, because that's where he feels many of his best decisions actually materialize.”
Radical acceptance quiets noise from past decisions and present wishful thinking
“Radical acceptance quiets the noise created by yesterday's decisions and today's wishful thinking.”
Brad Jacobs sold his road rental businesses at a $500M loss
“We ended up selling those road rental companies at about a half a billion dollar loss because it was the best way forward under those circumstances.”
XPO's contrarian $2B stock buyback generated a $4B profit
“A couple of years later, those two billion dollars of shares we brought back, we bought back, ended up being worth six Billion dollars, giving them a profit on that one transaction of four billion dollars.”
Red Bull's Dietrich Mateschitz paid himself up to $800M annually
“He was paying himself before he died somewhere between five hundred and eight million dollars a year.”
Tech routing cut United Waste's fleet requirement from fifty to twenty trucks
“Instead of sending 50 trucks out over five days to pick up X tons of waste. 20 trucks, so more, less than half, could now perform the same service in three days.”
United Rentals acquired Wynne Systems to access industry-wide macroeconomic data
“Owning win accomplished two things. One, we had an industry-best platform that we can continue to develop internally for our own use, and the acquisition gave us access to aggregated, anonymized data on macro trends across, across the industry.”
Deals Brad Jacobs avoided contributed more to his success than completed ones
“The deals I've avoided have contributed more to my success than the deals I've done.”
Executive teams naturally filter information to create overly rosy operational views
“Your executives, the team you have around you, like they, over time, they start to like filter information too much and they can give you like an overly rosy or like false, like positive view of what's actually happening in your company.”
United Rentals reached $1B revenue in thirteen months; Hertz took 37 years
“Hertz did this, and they built up a national equipment rental chain to about a billion dollars of annual revenue over the course of 37 years. United Rentals did that in 13 months.”