Ali Hamed shares insights on building a $2.5 billion investment firm, finding alpha in unique places, YouTube catalogs, creative real estate opportunities, venture investing benefits, lessons from firm building, working with Michael Ovitz, and the importance of people development in asset management.

I’m Jesse Pujji and this is Business Breakdowns. Today we are doing a different kind of breakdown. We are covering an entire category, Amazon Aggregators. These are the companies that are buying up hundreds of Amazon’s third-party sellers. The concept of Amazon Aggregators is relatively new, tracing back to 2018 with the founding of Thrasio, but the ecosystem is already huge and growing. Most recent numbers peg it at around $300bn dollars in revenue and growing faster than Amazon itself. These aggregators have unique moats and high-quality entrepreneurs. To help break down the marketplace and business of acquiring Amazon storefronts, I’m joined by Ali Hamed, a partner of CoVenture, who is also a popular guest on Invest Like the Best. In our conversation, we discuss the three superpowers Amazon sellers have, why there’s only $8bn in funding for a market doing $50bn in EBITDA, and we go into detail on how Amazon Aggregators are structured and operate. Please enjoy this unique breakdown on Amazon Aggregators. For the full show notes, transcript, and links to the best content to learn more, check out the episode page here. ----- Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes. Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here. Follow us on Twitter: @JoinColossus | @patrick_oshag | @jspujji | @zbfuss Show Notes[00:03:23] - [First question] - What is an Amazon aggregator, and who sells through Amazon?[00:05:26] - The scale and size of the aggregator market in general[00:06:43] - The history of third-party sellers and the utility they offer Amazon[00:08:20] - When they started inviting third parties to join their network and their market share[00:09:47] - Amazon’s 40% take-rate and overview of the economic structure[00:10:24] - How many individual storefronts exist and what they look like [00:13:19] - Who is starting Amazon stores and an overview of a seller writ large[00:14:43] - The initial insight that led to incorporating third-party aggregators[00:21:17] - How many aggregators exist in the space today[00:24:41] - Why vertical integration isn’t such a primary focus for aggregators[00:26:53] - Ways aggregators find businesses and how they tend to acquire them[00:31:29] - What the top 10 aggregators look like and their acquisition frequency[00:32:25] - The common value add aggregators deliver post-acquisition[00:36:47] - Deal pipelines and other sales and marketing functions[00:40:22] - Interesting things in the space given how unique of a marketplace it is[00:43:57] - New innovations and secondary ecosystems emerging as a result of aggregators[00:45:13] - How an aggregator should think about Amazon and risks to their business[00:48:29] - Why Amazon won’t use their data and customer ownership to own the market[00:50:10] - Macro and system risks that would threaten the success of this business model[00:52:35] - What keeps Amazon up at night and potential worries about aggregators[00:53:54] - Reasons why they would pass on an acquisition opportunity[00:55:32] - Contributing factors to explosive growth that exceeded expectations[00:58:10] - Biggest takeaways for builders and investors from 3rd party aggregators[01:01:04] - Where to learn more about Amazon’s third-party aggregators

Ali Hamed, Co-founder of Treville, a $2 billion investment firm, shares insights into building a unique investment strategy. He discusses the 'founder fair' philosophy influenced by Michael Ovitz and the importance of intentional networking. Hamed emphasizes maintaining authentic relationships while rejecting conventional work-life balance. He explores the advantages of diversifying across asset classes and creating a high-intensity culture within his firm. His journey from cold emails to significant AUM showcases the power of strategic connections in the finance world.

Ali Hamed, Co-Founder at CoVenture, shares insights on early-stage investing, discussing the importance of capital vs. ideas, democratization of private market investing, funding YouTube creators, contrarian investing strategies, and personal growth in the finance industry.

My guest today is popular past guest Ali Hamed, who joins us for an update on private credit. We discuss what has happened so far, what parts of the market are frozen, and where opportunities may lie. We also talk about how the world has shifted digitally since the beginning of the COVID pandemic. Please enjoy my conversation with my friend Ali Hamed. This episode is brought to by Koyfin. For more episodes go to InvestorFieldGuide.com/podcast. Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub. Follow Patrick on Twitter at @patrick_oshag   Show Notes (1:41) – (First question) – World of private credit in the pandemic age (4:50) – Bag of uncertainty (6:27) – Important levers in private credit (9:15) – Scary scenarios and systemic risks in this world (13:21) – General trends in the credit data (15:30) – Are investors factoring government response properly (17:02) – Defining advanced rates (20:18) – Focus on quality vs rate of return now (22:26) – Pockets of opportunity as uncertainty declines (26:06) – Online ecommerce platforms, like the YouTube economy (29:40) – Non advertising driven ecommerce platforms (31:54) – How venture capital is responding (38:19) – How junior debt could be am opportunity (40:17) – Trends he’s thinking about; redefining small businesses (43:07) – Ali Hamed Podcast Episode   Learn More For more episodes go to InvestorFieldGuide.com/podcast.  Sign up for the book club, where you’ll get a full investor curriculum and then 3-4 suggestions every month at InvestorFieldGuide.com/bookclub Follow Patrick on Twitter at @patrick_oshag