This is a short thread I posted on my Twitter.
Public equities and SMBs.
The prior is about investing in the largest businesses that are publicly traded, and the latter is about owning small and mid-sized businesses.
They seem to be complete opposites, yet share some fundamental resemblances.
I’m writing this to tell you that the skills you gain as a public equity investor, will help you become a better SMB investor.
Of course, both have their uniqueness, but they are essentially the same thing: investing in companies.
When I got exposed to public equities as a university student through managing a $4M fund, I was able to conduct in-depth research for the first time, reflect deeply on various investment ideas, and make real investment decisions.
That’s when I realized that:
The ability to conduct in-depth research and form an original thesis is at the core of all successful business investment.
Becoming a good public equities investor will therefore help you in every area of business, because you become a better business analyst and decision-maker.
How can you use this in your quest to acquire an SMB?
If you are interested in a specific industry, I’d recommend analyzing all the major public companies that are operating in that sector. Go through their reports, understand how they operate, read their investor material.
The better you become at analyzing businesses, the more likely you are to succeed in the SMB world, because they are all fundamentally the same thing.
This was a short thread, but I’ll have to dive deeper into my learnings from Public Equities at some point.
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