My First Million

The best business ideas come from noticing what's working and doing it better, faster, or for a different audience.

No-Fee Private Equity Fund

For: High net worth individuals seeking alternative investments

Buildability

The Problem

Traditional private equity charges high fees (2% annually) and uses excessive leverage, creating alignment issues and downside risk

The Solution

Create fund structure with no management fees, only profit sharing on returned cash, using no debt and holding businesses for 30+ years

Why Now?

Small business market remains inefficient, traditional PE moving upmarket creates opportunity in sub-$10M businesses

Build MVP in 7 Days

Day 1

Create simple fund structure document

Day 2

Identify 3-5 target acquisition candidates

Day 3

Build basic LMS for investor updates

Day 4

Establish broker relationships

Day 5

Create investment thesis presentation

How to Validate

Survey potential LPs on fee structure appeal

Test ability to source deals in target market

Validate operational improvement assumptions on one business

Confirm regulatory requirements and costs

Revenue Model

40% of distributed free cash flow above hurdle rate, no management fees

Competitive Moat

Reputation, deal flow, operational expertise, patient capital structure

Risks to Consider

Long fundraising cycle due to novel structureLimited exit options creating LP liquidity concernsDependence on key person for deal sourcingEconomic downturn affecting small businesses

Related Knowledge

Trend

Individual investors buying small businesses instead of starting them

More individuals choosing to acquire existing cash-flowing businesses rather than start from scratch, driven by awarenes

Same episodeComplements

Tactic

Content marketing: Writing detailed annual letters and blog posts about investment philosophy

Builds trust through transparency, demonstrates thinking quality, creates searchable content for prospects

Same episodeComplements

Framework

Stacking Golden Geese

Sequential acquisition strategy where each successful business acquisition funds and de-risks the next, creating compoun

Same episode

Framework

High Authority vs Delegated Authority Model

Binary leadership approach where you either operate with complete top-down authority or delegate full decision-making au

Same episode

Playbook

Acquire first cash-flowing business with minimal capital

Own a profitable business generating $200K-500K annual free cash flow that doesn't require your daily presence within 2

Same episode

Mental Model

Just-In-Time Learning

Learn skills and knowledge precisely when you need them for specific situations rather than trying to learn everything u

Same episode