Building Your Investment Thesis

Introduction to the Speaker

• Speaker: Chris Ashnelli
• Involved in building, buying, and selling simple profitable businesses through Bootstrapper Capital.

Key Concepts

• Investment Thesis: A foundational step in the build-buy-sell journey for businesses.
• Wedge Equity: The incremental value gained in a business from acquisition to sale.

Developing Your Investment Thesis

• Start with Yourself:
  • Inventory your personal "why" – the motivation that drives you.
  • Reflect on personal skills, abilities, and traits.
  • Identify areas where you can add value (e.g., marketing, sales, operations, finance, etc.).

Importance of Knowing Your "Why"

• Provides purpose and intent.
• Helps in staying motivated and enduring the challenges of building businesses.

Inventory Skills and Interests

• List skills and subject matter expertise.
• Align skills with personal interests.
• Determine where skills and passions overlap; this overlap assists in building a strong investment thesis.

Research and Market Analysis

• Conduct thorough research on industry market trends and investment opportunities.
• Develop an understanding of market conditions and potential trends (e.g., B2B SaaS, micro-SaaS).

Crafting Your Investment Thesis

• Develop a clear, actionable investment thesis based on research and personal alignment.
• Simplify the thesis into a clear strategy with defined goals and tactics.

Sharing and Validating the Thesis

• Share the investment thesis with peers and networks for feedback.
• Conduct real-world validation through discussions, podcasts, and market feedback.

Risk Mitigation

• Investment should focus on minimizing risks and maximizing returns.
• Continuous feedback and adjustments according to market trends and feedback from others.

Deal Flow and Value Creation

• Ensure quality deal flow to support the investment thesis.
• Focus on adding incremental value to acquired businesses.

Exit Strategy

• Have a clear exit strategy to recoup investments or return capital to investors.

Continuous Improvement

• Regularly revisit and refine the investment thesis.
• Stay aligned with personal motivations and market dynamics.

Summary

• The investment thesis is a living document that should evolve with experience and market shifts.
• Emphasize simplicity and clarity, ensuring the thesis is actionable and aligned with personal and market realities.