How Holdco Legend Michael Girdley is Playing Multi-Decade Games (and Winning)
Sep 7, 2023
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Michael Girdley, a successful entrepreneur, shares insights on building a $100M+ holding company. They discuss acquiring businesses, making big decisions, building communities, tech continuing education, family businesses, and the strategy of buying hyper-niche software. They also explore the success of a reclusive founder and the importance of long-term commitment.
Michael Girdley has found success in incubation rather than acquiring businesses due to high asset costs.
Girdley emphasizes the importance of having a competitive advantage and going against the crowd when acquiring businesses.
Girdley admires Constellation Software for their long-term commitment and maniacal focus in acquiring and scaling companies.
Deep dives
Michael Gerdley's Diversified Portfolio
Michael Gerdley, a holdco entrepreneur with a decade of experience, owns a diverse portfolio of companies based in Texas. He started with a fireworks business and expanded into sectors like education. Over the past five years, Gerdley has honed his ability to incubate and acquire companies. While many holdco entrepreneurs advocate for buying businesses, Gerdley has found success in incubation due to the high costs of acquiring assets. He believes in watching where the opportunities are and going against the popular narrative when necessary.
Finding Great Businesses to Buy
When it comes to acquiring businesses, Gerdley utilizes two main approaches. The first is the front door approach, where he goes through listings, learns about industries, and makes phone calls to potential sellers. The second approach is more serendipitous, relying on networks and inside information to find great deals. Gerdley emphasizes the importance of having a competitive advantage in the industries he acquires, which allows him to make informed decisions and avoid unnecessary competition. He also highlights the value of timing and going against the crowd when everyone is saying the same thing.
Lessons from Constellation Software
Gerdley admires Constellation Software and its CEO, Mark Leonard, for their success in acquiring and scaling vertical market software companies. He recognizes the power of maniacal focus and long-term commitment, as Constellation Software's growth over the past 25 years demonstrates. Gerdley aspires to follow a similar path and build businesses that have a significant impact, whether through acquisition or incubation. He aims to focus on long-term vision and pursue opportunities that have the potential to change the world and generate substantial growth.
Planning for the Future
While Gerdley is uncertain about his personal plans for the next 20 years, he acknowledges the importance of taking time to make difficult decisions. This involves gathering data, thinking deeply, and seeking advice from trusted individuals. He embraces the process of personal introspection and envisioning what he wants his future life to look like. As for his business plans, Gerdley is committed to continuing his current path of acquiring and incubating companies that have the potential for significant growth and impact. He aims to create big ideas and play multi-decade games in order to achieve long-term success and fulfillment.
The Significance of Chilies
Gerdley's humorous references to chilies on Twitter hold a deeper meaning for him. They represent his appreciation for the simplicity and beauty found in everyday experiences and the lives of ordinary people. Gerdley values the idea that joy can be found in any context, such as a casual dining establishment like chilies. He believes that there is beauty in normalcy and in the connections people form in seemingly mundane places. Contrary to the notion that everything needs to be extravagant or exceptional, Gerdley sees the value in finding happiness and meaning in the ordinary.
Today Greg is joined by Michael Girdley--who's spent the last 30 years building a $100M+ holding company. In this episode, Greg and Michael talk about whether holding companies should take sexy VC money and how to be a decades-long player in a world of base hitters.
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FIND ME ON SOCIAL: Twitter: https://twitter.com/gregisenberg Instagram: https://instagram.com/gregisenberg/ TikTok: https://tiktok.com/@gregisenberga
LINKS FOR THIS EPISODE: Production Team: https://www.bigoceanpodcasting.com Michael Girdley https://twitter.com/girdley https://girdley.com/
SHOW NOTES: 0:00 - Intro 4:32 - Finding great businesses to buy 7:22 - Does Michael think Greg made a mistake by turning down $30M? 15:15 - Do this one thing before making a big decision 25:27 - Scalepath, EverthingMarketplaces.com, Reforge and other companies doing communities right 33:15 - The story behind Alamo Fireworks 44:58 - How Michael Girdley is playing the long game
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