What I Learned Investing in 24 Companies in 24 Months

In this episode, the speaker reflects on the lessons learned during a 24-month investment period involving 24 portfolio companies. Over time, the investment strategy at Acquisition.com has shifted from a focus on quantity to a focus on the quality of the founders and companies being invested in. The speaker discusses how the initial thesis of blending private equity with social media to create proprietary deal flow evolved into a realization that having the right people, or 'jockeys,' is paramount in achieving business success.

During the investment period, the speaker conducted a time study to evaluate how resources were allocated within the portfolio companies, discovering that more time was dedicated to struggling businesses instead of those with potential for growth. As a result, the strategy shifted to prioritize companies yielding the best returns while cutting ties with those that were stagnant. The importance of revenue retention as a key metric in assessing the sustainability and potential growth of businesses was also highlighted.

The speaker advocates for concentrating resources on the best performing companies or 'whales' rather than spreading efforts too thin over 'minnows.' They stress that the right people are critical for business success, with an emphasis on finding and attracting top talent. The differences between service-based businesses and software ventures were discussed, concluding that focusing on fewer, bigger deals with strong revenue retention prospects leads to better overall business outcomes.