Our teachers today are Daniel Eisen and Paul Yancich, co-founders of Arcadea Group. Arcadea is a private market, long-duration investor building a permanent home for high-quality, vertical market software companies.
Today, we sit down with an example of next-generation talent in Daniel and Paul, who began Arcadea after having the rare opportunity to learn and sit at the feet of Mark Leonard and the remarkable core team of Constellation Software. In this session, we learn about the attractive opportunity in vertical market software and the structural advantages of pursuing this particular opportunity with permanent capital. They've built Arcadea in a way that both honors their past while successfully layering on their own unique ethos. Please enjoy our class with the impressive and inspiring Daniel Eisen and Paul Yancich.
For the full show notes, transcript, and links to mentioned content, check out the episode page here.
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Show Notes
(00:00:00) Welcome to the Art of Investing
(00:04:19) First Question - The Success of Constellation Software
(00:14:58) The Role of Incentives in Business Success
(00:18:37) Paul’s Personal Background and Career Path
(00:21:48) The Journey to Success: Overcoming Obstacles
(00:25:35) The Importance of Operating Roles in Business
(00:29:41) Breaking into Finance with a Religious Studies Major
(00:33:22) Working with Mark Leonard
(00:40:10) The Birth of Arcadea
(00:43:11) Influences On the Vision For Arcadea
(00:44:19) The Concept of Renter vs Owner in Business
(00:44:59) The Influence of 'The Hard Thing About Hard Things'
(00:47:58) The Decision to Start Arcadea and the Importance of Partnership
(00:55:52) The Structure of Arcadea as a Company, Not a Fund
(01:01:29) The Importance of Long-Term Ownership and Growth Orientation
(01:06:16) Reflecting on the Early Years of Arcadea
(01:12:01) Positioning Against Venture-Backed Companies
(01:17:22) Building a Shareholder Base
(01:30:49) The Future of Vertical Software
Joys of Compounding