Playing the Long Game: Building a 30-Year Private Equity Fund with Brent Beshore [The Opportunity Ep.131]

Private equity is a fast-paced game. You buy a business and
often only have two to five years' worth of investor capital to
improve the business before you need to sell it for a
profit. 


This doesn't give you a lot of time to make meaningful
improvements and often results in changes that destabilize the
business long term.


That's why Brent Beshore decided to turn the concept of
private equity on its head. Brent is the founder of Permanent
Equity, a PE firm that invests in family-held
businesses. 


The twist? Brent has no intention of selling the
businesses. Forget two to five years, he works with a 30-year
time horizon. He also uses no debt in his acquisitions and takes
zero fees or reimbursements. Instead, he splits the cash flow
that the business earns, putting his firm, the investors, and the
family that owns the business on equal footing. 


This almost indefinite timeline, and the fact that he
doesn't have a debt looming over his head, means Brent has the
freedom to grow the businesses sustainably and with everyone's
best interests at heart. 


In this episode, Brent joins us to share his unique take on
private equity. He explains how he built his funds with longevity
in mind, and why he steered away from the traditional private
equity approach to debt. According to Brent,


"Buying a business with debt means you have to sacrifice
cash flow every month to repay that debt. That gives you less
flexibility to reinvest back in the business. Less flexibility to
grow. And when things get hard, which they will, it forces you to
make decisions that are not in the long-term best interest of the
company."


Brent also explains why he has chosen to be industry
agnostic, focusing instead on "adolescent businesses" that offer
lots of opportunities to make improvements.
Finally, Brent shares
advice on how entrepreneurs can replicate his success,
explaining,


"There's a lot of opportunity in the private equity space.
But it's gonna be a lot of hard work and a lot of stress. You
need to prepare yourself for that and give yourself enough lead
time to be choosy. If you're starting from a dead stop, you
should give yourself three years of runway full-time to find the
right business, buy it, and start to operate it."


If you want to build a portfolio of business but are put
off by the traditional private equity model, then Brent's
unconventional approach may be just what you are looking
for!
Topics Discussed in This Episode:


Brent shares how he accidentally stumbled into business
ownership (02:45)


The obstacles Brent faced when acquiring his initial
business (09:28)


How buying that first business inspired Brent to grow his
portfolio (12:13)


The story behind Brent's unique fund structure
(15:22)


The makeup of Brent's business portfolio (20:10)


How Brent calculates the value of a business
(31:01)


Brent's due diligence process (33:51)


Why Brent chooses to purchase businesses without debt
(36:07)


How Brent approaches growing a business after acquisition
(39:59)


How Brent structured his team to manage such a large
portfolio of businesses (43:13)


Brent's advice on how entrepreneurs can replicate his
success (48:31)

Mentions:


Empire Flippers Podcast


Empire Flippers Marketplace


Schedule a call with our expert sales
advisors 


Create an Empire Flippers account


Permanent Equity


The Messy Marketplace


Brent's Twitter



Sit back, grab a coffee, and learn how to reap the benefits
of private equity without the traditional constraints!