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December 6, 2024 • 1hr 33min
#373 Breakfast with Brad Jacobs + How To Make A Few Billion Dollars
Founders
Brad Jacobs is one of the most successful entrepreneurs alive, having started 8 different billion or multi-billion dollar businesses. He has completed over 500 acquisitions and raised more than $30 billion in capital. Starting his first company at age 23, Brad has over 40 years of experience as an entrepreneur. This episode covers insights from Brad's book "How to Make a Few Billion Dollars" as well as lessons learned from having breakfast with him.
#373 Breakfast with Brad Jacobs + How To Make A Few Billion Dollars
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Key Takeaways
- Mindset and Mental Management are critical for entrepreneurial success - the first chapter of Brad's book focuses on "how to rearrange your brain"
- Problems are opportunities - don't avoid them, run towards them as each problem is a chance to create value
- Get the big trend right and invest heavily in technology - you can mess up many things but still succeed if you identify and capitalize on major trends
- Talent is everything - recruit superlative people, overpay them, and remember an empty seat is better than a poor fit
- Move fast - Brad built billion-dollar businesses in months where competitors took decades
- Think differently - successful people find value in unexpected places by thinking from first principles rather than conventional wisdom
- Relationships and reputation are paramount - they compound over time and open up opportunities
Introduction
Brad Jacobs is one of the most successful entrepreneurs alive, having started 8 different billion or multi-billion dollar businesses. He has completed over 500 acquisitions and raised more than $30 billion in capital. Starting his first company at age 23, Brad has over 40 years of experience as an entrepreneur. This episode covers insights from Brad's book "How to Make a Few Billion Dollars" as well as lessons learned from having breakfast with him.
Topics Discussed
The Importance of Mindset and Mental Management (00:00)
Brad emphasizes that successful people think differently than most. The first chapter of his book focuses on "how to rearrange your brain" to achieve big goals in turbulent environments where conventional thinking fails.
- Managing emotions and internal dialogue is critical for sound judgment and decision-making
- Expect positive outcomes and reframe negative thoughts as useful data rather than objective reality
- Use thought experiments and meditation to maintain calm and clarity - Brad meditates 30 minutes daily
- Don't expect perfection from yourself, family, coworkers, or business partners
Problems as Opportunities (24:36)
One of Brad's most important mentors, Ludwig Jesselsn, taught him that problems are what business is all about. Each problem is an opportunity to remove an obstacle and get closer to success.
- "Look Brad, if you want to make money in the business world, you need to get used to problems because that's what business is" - Ludwig Jesselsn
- Great companies are effective problem-solving machines
- Big ambitions often create bigger problems - get excited about them rather than frustrated
- Problems are assets to run towards, not obstacles to avoid
Getting the Big Trend Right (48:51)
Brad learned from his mentor that you can mess up many things in business but still succeed if you get the major trend right. He is obsessive about researching industries before entering them.
- Technology is the dominant megatrend - plan to invest heavily in tech in any industry
- Thorough research process includes:
- Reading everything available about the industry
- Attending conferences and meeting management teams
- Interviewing experts, CEOs, bankers, and analysts
- Studying trade associations and industry data
- Look for opportunities to apply technology to improve information flow and efficiency
Building an Outrageously Talented Team (1:22:31)
Brad believes the most important thing a CEO does is recruit great people. He emphasizes the massive difference between A, B and C players.
- "There's no substitute for smarts" - screening for superior intelligence eliminates 90% of candidates
- Key traits to look for:
- Ability to think dialectically (from multiple perspectives)
- Capability to change opinions based on new information
- Ambition to accomplish big things
- Overpay for talent - it's nearly impossible to overpay for truly exceptional people
- An empty seat is less damaging than a poor fit
Speed and Execution (1:14:07)
Brad's companies are known for moving extremely fast - he built United Rentals into a billion-dollar business in 13 months while competitors took decades to reach that scale.
- Speed is a competitive advantage - don't slow down because competitors ask you to
- Move quickly but thoughtfully in acquisitions and integration
- Being slightly understaffed keeps teams focused and reduces redundant work
- Maintain high standards while moving fast
Relationships and Reputation (1:31:21)
Brad emphasizes that relationships run the world and reputation is everything. This compounds over time to create more opportunities.
- "Lose money for the firm and I will be understanding. Lose a shred of reputation for the firm and I will be ruthless." - Warren Buffett quote referenced by Brad
- Long-term view is the right view - never jeopardize reputation for short-term gains
- Build authentic relationships - don't hide eccentricities
- Pay it forward and help the next generation of entrepreneurs
Creating Value Through Entrepreneurship (1:30:04)
Brad sees entrepreneurship as a noble pursuit that creates value for society through jobs, products/services, and wealth creation for shareholders.
- Fill unmet needs in the economy with strong business models
- Create healthy work environments and compensate people well
- Focus on customer satisfaction and solving real problems
- Take pride in creating value that benefits society broadly
Conclusion
Brad Jacobs provides a masterclass in entrepreneurship through his book and personal insights. His focus on mindset, problem-solving, trend identification, talent acquisition, speed of execution, and relationship building offers a comprehensive framework for business success. The emphasis on thinking differently while maintaining high standards in people, processes, and reputation has enabled him to build multiple billion-dollar enterprises across different industries. His approach demonstrates that entrepreneurial success comes from a combination of strategic thinking, operational excellence, and genuine value creation for stakeholders and society.