Disclosure
Beshore: Personal portfolio strictly limited to cash and small private acquisitions
“I hold two types of investments. I hold highly illiquid small private investments, right? In these companies that we, that we've acquired and cash and that's it. Like literally I have the, it's the most barbell strategy I've ever seen right now.”
Insight
Beshore: Rapidly modernizing Main Street businesses with technology is a pipe dream
“The thesis that you're gonna come into a small blue collar, you know, sort of main street business
and transform the business in any sort of reasonable timeframe with, you know, fancy technology is likely a pipe dream.
you're gonna have a lot of cultural entr…”
Insight
Beshore: Transparent content attracts the right partners and repels wrong ones
“We found that the best way to repel the wrong people and attract the right people is to put out content that says who we are and what we do.”
Disclosure
Beshore: Permanent Equity avoids putting debt on portfolio companies
“We're very different than traditional private equity in, in the sense that we don't typically put any debt on the companies.”
Assertion Not checkable as stated
Beshore: Debt-free portfolio companies survive 60% earnings drops without layoffs
“Earnings can go down 50, 60% and everyone still keeps their jobs and”
Insight
Beshore: Companies should invest aggressively during downturns rather than retreat
“We really encourage our companies when there's adversity, like don't miss the opportunity for a good crisis and serve as well.”
Disclosure
Permanent Equity buys companies debt-free and holds them indefinitely
“So what we do is we buy with no intention of selling the business. We typically use no debt in the transaction. We love to keep leadership teams in place. We don't we don't replace the leadership typically, unless there's a sort of acute problem. And we hold i…”
Disclosure
Beshore: Permanent Equity avoids companies needing outside help to succeed
“We always say we're not going to be involved with a company that wouldn't be successful without us.”
Insight
Beshore: Small businesses stay small because of removable operational bottlenecks
“Small businesses don't stay small on purpose. There's a reason why they stayed small. And usually there's some lids on the business that we're able to release over, over time that help the business grow.”
Insight
Beshore: Changing systems and staff increases both upside and downside risk
“So if you don't come in and change anything, you should probably expect the company to perform kind of how it's performed in the past.
the more you start changing systems and changing out people it increases the upside opportunity, but it also increases the d…”
Insight
Beshore: Lower purchase multiples give buyers the luxury of time
“If you pay a ton for a business, the expectations are sky high. You've got to start doing a lot of things to generate that return. If you pay a little bit less expectations can be lower and you can take your time.”
Insight
Beshore: 'Owner moat' prevents small businesses from being successfully transferred
“A lot of smaller companies are just not transferable. We call it owner moat where all of the value of the business is tied up in the goodwill of the owner. So the owner leaves all the relationships, all the skills Everything kind of falls apart. They're the li…”
Disclosure
Beshore: Permanent Equity typically pays 4x to 6x future cash flow
“So look, we paid three times for a business. We've paid 10 times for a business. Those would kind of be the, I would say, rough, you know, yardstick to use in terms of range. Most of the time we're paying four, five, six times.”
Disclosure
Permanent Equity prefers doing more similar-sized deals over increasingly bigger deals
“You know, I would say the model that we prefer is to grow out, which is you do more deals of similar sizes or in, you know, sort of a similar range, not bigger and bigger deals.”
Assertion Not checkable as stated
Beshore: Permanent Equity's Last Check Was $40 Million
“I mean, the last check we wrote was a forty million dollar check, which is, that's a big check for us.”
Disclosure
Beshore bought his first business with zero capital using an SBA loan
“I called a local lawyer that I had at the time whenever I had the opportunity to buy my first business. It was very, I had no capital. I took out an SBA loan and I said, okay, so what do we do next? And he said, well, we needed a due diligence. So I literally …”
Disclosure
Permanent Equity's portfolio includes a pool builder and high-end matchmaking firm
“We own swimming pool builder. We own a Heisen matchmaking firm. So executive search, but for love very interesting business. We own a military recruitment firm, a picture frame manufacturer, a fence builder. I mean, it's really all over the place. So services,…”
Opinion
Beshore: Charlie Munger Was Gracious, Thoughtful, and Highly Opinionated
“Charlie was incredibly gracious and kind deeply thoughtful. Very opinionated. I like people who speak their mind and tell you what they actually think. And he certainly did that.”
Disclosure
Brent Beshore states he has no formal finance degree or credentials
“I don't have a degree from a fancy school in finance. I, you know, I don't have any of the traditional markers.”
