Think Like an Owner David Dodson - Searching, Investing, Teaching - Ep.108
My guest on this episode is David Dodson. David started the second ever search fund after being a Stanford case writer, purchasing Smith Alarm Systems in 1989. Over his career, David has been the CEO or executive chairman of five companies, has and continues to invest in search funds today through his firm Futaleufu Partners, and he is a professor at Stanford Graduate School of Business, teaching classes about search and the management of small companies.
My conversation with David starts with his time as a case writer before launching his search fund. We talk about peaks and valleys in his search career, including some very hard conversations. We dive deep into the topic of transitioning from a contributor to a leader of a small firm and important leadership skills.
We also talk about how the search fund world has evolved over time and where it might continue to change in the future. Finally, we talk about the relationships searchers have with their investors and how to foster better ones. I've been really excited to have David on the podcast for quite a while, and I hope you enjoy our wide-ranging conversation.
Listen weekly and follow the show on Apple Podcasts, Spotify, Google Podcasts, Stitcher, Breaker, and TuneIn.
Links:
Topics:
(5:26) - David’s background and career
(9:21) - What sticks out to you the most when thinking back on getting someone to write you a check?
(12:11) - Once you had the capital, what did you do to search for companies?
(13:43) - What were some of the more stressful calls you had with owner/operators?
(15:03) - David’s experience acquiring & running Smith Alarm Systems
(19:06) - How did you approach your first 18 months as the new owner?
(23:50) - The 5 skills of Leadership
(29:11) - What are some examples of early prioritization as a leader?
(31:42) - How do you advise making the transition from being a contributor to one organization to being a leader of your own organization?
(34:46) - What are some common struggles folks have when they become a manager of managers?
(38:48) - What have been some “near-death experiences” in your career?
(45:16) - Are there any exercises you try to do to put your mind at a pause when you’re making a critical decision?
(47:41) - What are some ways you’ve seen the Search Fund world change throughout your career?
(51:11) - Are there too many searchers?
(53:00) - What advice do you have for searchers to build relationships with their investor base?
(56:26) - What college course would you teach if it could be on anything?
(58:22) - What’s a strongly held belief you’ve changed your mind on?
(1:00:15) - What’s the best business you’ve ever seen?