Mark Brooks is Chief Operating Officer and Co-President of Permanent Equity - a firm that invests with no intention of selling in small and medium-sized private businesses. In his role, Mark and his team are responsible for the operations of PE's 13 (and counting) portfolio companies spanning multiple industries including aerospace, construction, manufacturing, ad tech, and professional services.
On this episode, Mark & Chris discuss:
➡️ what makes a great and a terrible manager
➡️ how Mark manages owners of acquired businesses
➡️ how to create alignment and incentives
➡️ why Management is not a Trade
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Additional Resources
👉 Permanent Equity
👉Mark on Twitter
👉The Permanent Equity Podcast
Timestamps
(00:03:05) Mark’s career at AOL and The Motley Fool
(00:08:21) What is a good manager and what is a bad manager?
(00:11:29) What does your role look like at PE?
(00:17:37) What’s the cadence of communications with the businesses under PE?
(00:23:14) Are there cues in conversations with owners of a potential acquisition that put a deal in question?
(00:25:07) Do any of the businesses you buy already have a board in place?
(00:27:03) How do you handle owners who may not be as open to being managed?
(00:31:22) How do you incentivize owners differently than other Private equity shops?
(00:39:22) The 'Working with Mark' document
(00:43:41) Management is not a trade
(00:48:53) Do you agree that people leave managers, not companies?
(00:51:23) What’s the difference between a Manager and a Principal?
(00:56:03) What do you use in addition to personality tests to identify talent?
(01:01:11) How do you play out a scenario when you have two equals in a business and need to have one move up to manage the other?
(01:07:23) How do you know you’ve struck a balance between being too flat and being too management-heavy?
(01:12:17) How do you create alignment and incentives for teams that may not necessarily be impacting the bottom line?
(01:22:39) Why are incentives so much easier to understand in hindsight?
(01:27:34) What should the communication cadence between managers and teams look like?
(01:30:39) True Management is an inversion
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