Kurt Leedy and Kyle Coots - The Three Methods to Grow Capital - Ep.134

My guests on this episode are Kurt Leedy and Kyle Coots, co-founders and managing directors at Miramar Equity Partners. Kurt and Kyle have an interesting vantage point in the search world being backed by a family office with an agnostic time horizon, allowing them to invest in the widest set of opportunities in search and parallel spaces. Our episode focuses on a concept they developed they call the three ways to make money, those being classic LBO, M&A-driven strategies, and organic growth. We dive into the characteristics of each along with a few examples from their portfolio. We also touch on how the intersection of two or more methods can create exponential outcomes. Finally, we discuss a few theses they find interesting in healthcare and software and how they develop a thesis on an industry. Listen weekly and follow the show on Apple Podcasts, Spotify, Google Podcasts, Stitcher, Breaker, and TuneIn. Special thanks to our sponsor: Oakbourne Advisors Links: Miramar Equity Partners Kurt Leedy on LinkedIn Kyle Coots on LinkedIn Will Thorndike with Patrick O'Shaughnessy BPD Zenith Flint Group Swoogo Encore Infusion Constellation Business Breakdowns - The NFL Time Codes: (3:36) - How did your backgrounds help form this concept of “The three methods to make money”? (9:18) - Do you have a model of investing that resonates most with what you’re looking to accomplish? (12:24) - Have Search CEO’s been primarily focused on one of these three buckets in your experience? (15:51) - What are some characteristics & examples you’ve seen of the Classic LBO investing model? (18:36)- What questions or risks are you optimizing for when considering LBO? (22:13) - What are some factors that have correlated with a high retention rate in companies you’ve observed? (24:23) - Can you walk us through how you divide M&A Driven Strategies into its two subcategories: Roll-Up and Transformative? (33:46) - Is there some value in having M&A experience for a CEO & their company? (35:42) - Why do you think there is such increased popularity in the M&A strategy within Search? (39:00) - Which companies and characteristics fall under the Organic Growth Model? (46:00) - What are some examples of companies who have combined these methods and found success? (51:10) - What are your thoughts on Software businesses and any opportunities in that space? (54:40) - What are some ways you develop and validate different theses? (1:01:19) - What strongly held belief have you changed your mind on? (1:03:32) - What’s the best business you’ve ever seen?