Chris Lewis from Riordan, Lewis, & Haden spoke to our leadership class about how he evaluates potential private equity investments.
The firm operates somewhat like Berkshire and uses little leverage. They buy private companies and over the last 20 years have averaged generous returns without leverage.
They started the firm to invest in VC-type opportunities (pre-revenue) but now have more of a buyout mentality but still earlier stage ($40M revenue companies). They buy these companies with the goal to build them to $200M revenue companies.
Chris grew up in LA and was the national tennis champion at USC. He even played on the pro tour and was something like 60th in the world. Nice! After going to business school at USC, he worked at Bank of America in money management. Chris met Mayor Riordan who had been doing VC for 10 years and that's what led to them starting RLH.
He emphasized that the most important component they look at is people. Successful businesses almost always will pivot their business, so having a long-term perspective and dedicated, flexible people is key. The top "people" qualities they look at are the following:
I was quite impressed by a talk I recently heard by Sasha Strauss, Managing Director of Innovation Protocol, a branding agency serving a variety of companies -- from start-ups to Fortune 500. Sasha's also a USC Professor in Communications.
First off, what made the talk super engaging was the intense energy and humor (often self-deprecating but always keenly observant) of the speaker. That just rocked.
Secondly, the content, while not particularly new, was super distilled and weeded down the core of what matters, and it made me consider the strategy of some of the biggest brands in a new light.
I would have liked to hear more examples of brand strategy at start-ups versus big companies whose brands everyone knows; that would have been a nice application of some of Sasha's frameworks.
Below are my main notes and takeaways from the talk. Overall, it was a blast, and I don't even dare to do justice to the full force of the event simply in writing.
"The perfect is the enemy of the good." --Voltaire
"Any idiot can come up with a perfect plan for war as long as he's not actually doing it." --Churchill
In one of my classes with former Mayor Riordan, he presented these two quotes to us in connection with his "axioms of leadership."
Voltaire's quote is definitely at the heart of entrepreneurship: the importance of "getting on with it" and making decisions. This ties in to Riordan's "courage" axiom of leadership.
Churchill's quote goes one level deeper into this in pointing out that it's much easier to be an external party considering what would be best for others to do rather than having to actually do it yourself (especially when it's something as difficult and risky as going to war -- or launching a company). That's why many people write about it instead of doing it.
An interesting way to combine the two quotes is to realize that when you're making a plan for yourself, you can't aim for perfection -- goodness and timeliness matter most.