An Unconventional Approach to becoming CEO

My big product announcement and a story of buying a business with zero dollars down

My new product: a sling bag for climbers (more info below!)

Hello there,

Congratulations on making it through the darkest 10 weeks of the year!

This probably matters less if you aren’t located in a northern latitude with sunsets before 5pm, but it’s a satisfying feeling of progress as we circle the sun another time.

Despite short days, I’ve had busy ones with quite a few projects to juggle. We have an entire garage renovation going on in our backyard.

It might be a little loud, but it’s extremely satisfying to make progress on a dream many months in the making - coming soon, a new home office + workout space (with climate control!)

How Sarah Moore Rewrote the Entrepreneurial Playbook

Among business school graduates, around 25% go into consulting and 20% into finance, but one unconventional story shows the power of thinking differently.

At Harvard Business School, Sarah Moore felt out of place with her peers, particularly coming from a troubled and impoverished background. She also wanted to go work in finance until her classmate explained one industry standard that changed her mind.

This guy treated responding to messages like an up-tempo jazz drummer, giving answers with rapid speed like a relentless snare rhythm. When Sarah Moore asked, “How do you do this?” he explained the culture at Morgan Stanley where he worked before grad school. The "Rule of 15 minutes” meant you’re expected to reply to any communication in under 15 minutes. It didn't matter if it was Christmas or your honeymoon.

And Sarah was more of a reggae person who placed a high value on freedom, so her search for the ideal job led her to purchase a multi-million dollar business in egg carton sales, which she bought with zero dollars down.

It’s the model that matters more than anything else in a business. This is what I finally understand to be Warren Buffet and Charlie Munger’s distinct advantage - they spent hours daily reading financial statements to find those outlier business models.

Sarah learned about something called a search fund, where you go buy an unflashy business and become CEO overnight. That sounded perfect, so she dove into the data and analyzed 100,000 businesses to down-select for her very specific criteria.

At first, she listened to advice from her peers, searching for “trending” business sectors and high revenue numbers. But she slowly adjusted her requirements and simplified to one key thing: has the business been consistently profitable for several years? In her words “everything else is garbage.”

Sarah emailed thousands of businesses with a template that auto-populated, so each email appeared to be individually written. Then one day she was surprised to get an email back from the owner of EggCartons.com, a multi-million dollar business that had been running for over twenty years.

Three other fascinating things from her story:

1. Smarter outreach: to improve her response rate, Sarah tried all sorts of off-the-wall techniques, including sending a photo of herself wearing a sweatshirt that said “I want to buy your business” via fax to thousands of businesses per day. People still recognize her for that.

2. Intern Library Entry: instead of hiring other Harvard Business School classmates, Sarah used Craigslist ads to find motivated interns who worked out of the Harvard library using fake student IDs so they could access the business databases.

3. Uncollaterized loan: to acquire the business without a big savings account Sarah contacted over 100 banks, most of which wouldn’t even talk with her, but one agreed to 75% bank debt and 25% seller’s note, meaning she put $0 down.

Sarah Moore was asked, what inspired you to go out and buy a company? Her answer was one word; “freedom.”

And what’s more, she has a totally badass mantra:

“Don't take counsel from your fears.”

Worthy & Remarkable

• The Poem/1 AI Rhyming clock offers a new spin on telling time with a new poetic sentence every minute ($70k on Kickstarter) - now that’s a fun use of ChatGPT!

• The KUKU Coffee Maker looks like something from a steam-punk novel and can make hot or cold coffee - woah!? ($570k on Kickstarter)

• Fast cuts, beautiful skies, and an upbeat soundtrack pair with footage of Alex Megos sending the new 5.15b Sleeping Lion (first climbed by old man Chris Sharma!)

• I was both inspired and terrified while watching Amity Warme on Book of Hate - wild stemming on a corner route in Yosemite

One Thing from Me

I recently announced my sling bag project, which I’ve been working on for over 10 months!

I have received some terrific feedback so far, and what’s more important is that I’m still having fun while making ads and trying to get attention for my product!

Check out the fun 50-second announcement video. And here’s the landing page if you want to learn more. I’ve jumped headfirst into making custom Shopify pages and running facebook ads, but it’s a steep learning curve.

In the words of Corita Kent, “There is no win and fail. There is only make.”

Thanks,

Jono

PS - now this is a feat of true salesmanship