[Podcast] Founder and Managing Partner of Alpine Investors Graham Weaver — An Entrepreneurial Journey
In today’s episode, Wesley Aster and Djavaneh Bierwirth hosts Graham Weaver, the Founder and Managing Partner of Alpine Investors, a software and services focused private equity firm that stands out not only for its financial success but for its exceptional commitment to people and culture.
Tune in to hear about:
- Graham’s journey from starting Alpine in his Stanford dorm room to growing the firm to $16B in AUM
- Graham’s personal growth and investment philosophies, as well as how he thinks about driving long-term impact
- Alpine’s latest $4.5 billion fund 9, and Graham’s experience fundraising in a challenging market
Graham’s Background and Journey of starting Alpine Investors
Graham Weaver: I started off right out of undergrad in private equity. I worked on Wall Street. I went to business school and during business school, I actually started buying companies in my dorm room as a fundless sponsor. The name of the fund, the sponsor didn’t exist back then, but that’s what I was doing. And it was really kind of crazy. I didn’t have any money. I financed my equity investment by borrowing on credit cards, no joke. It was probably not the way most private equity firms start. I made absolutely every mistake you can make it is that false humility. I lost money on I think five of my first eight deals I did, but at least I got going. And then over time, created a more standard private equity structure in 2001. That was how it got started.
Motivation for starting Alpine Investors and challenges faced along the way
Graham Weaver: I didn’t have a grand plan about building a business. I had learned enough about the mechanics of how to do a private equity deal, and I confused that with knowing how to evaluate a company and evaluate a management team. I knew like structurally how to close a deal and all the mechanics that went into debt and the documents and things like that, but I didn’t know any of the other stuff. Some of the businesses I bought weren’t great companies. I think the biggest thing was I was 25 at the time, and everybody whom I worked with was older than I was. I didn’t have the confidence to exert myself or to say, wait, that doesn’t sound right, or this person doesn’t seem like they’re performing. I was just very hands-off, and I didn’t really trust my instincts. That was one of the many things that probably went wrong in those early days.
What motivated the decision for Alpine Investors to pursue B Corp certification? How does Alpine’s B Corp certification inform its investment decisions?
Graham Weaver: Being a B Corp, there’s several different areas of focus — your customers, your community, your people, your shareholders, the climate and governance. We started to realize we were doing the things that a B Corp would require anyway. And then there’s a large part of the population, the millennials and Gen Z, are a lot more interested in making an impact than just making money. We wanted to have external validation and signaling about a lot of things we were doing anyway. I think we were the first or one of the first private equity funds to get a B Corp certification, which probably people don’t really associate with private equity. But it’s really good. We get measured on all those metrics, so we have to be accountable for how we’re conducting ourselves. It’s a good forcing mechanism for us to make sure we’re adhering to those values. It is a good signaling mechanism particularly to the younger generation who we want to work at Alpine and our companies.
One of Alpine’s key tenets is hiring selectively and investing heavily in training and employee engagement. How does Alpine Investors think about hiring and retaining employees?
Graham Weaver: Yeah, I worked at four private equity firms before I started Alpine. I don’t want to throw anyone under the bus, so I won’t say the name, but I’m working at this one private equity firm. They had an amazing recruiting class my year, myself and two other guys and the other two guys have gone on to do amazing things. And then the next year they recruited three. And credit to them, the hires were world-class people. But the person who ran the firm really looked at his job was to close deals, and almost like in competition with us. It was like this was my deal. And I want credit for it. And that was the CEO of the firm that he acted like that. And I remember just thinking at the time, if that CEO had spent 25% of his time, just trying to think of how to make the firm a place where the six of us wanted to spend our careers, he would have retained the six of us, you know, they’d probably be one of the top performing funds in the world. Instead, he spent zero time. All six of us left in a short period of time, and they had mediocre performance.
And I just remember thinking, a huge part of my job. Frankly, the most important part of my job is to make Alpine a place where those very, very, very best people want to work and importantly, where they want to stay. If we bring on an Analyst, and they’re 22, when they join our firm. By the time they’re 25, the way that we’re structured, they’ve probably closed 15–16 deals, and they’re amazing, and they have all kinds of skills. They can lead deals, and they know our culture. For us to lose a person at that time is extraordinarily expensive, particularly when you say what if we were to retain that person for another 15 years. What’s the lost value of that person? And I think when you look at it that way, you want to build a place where people want to see themselves for a long period of time. That’s really, really, really hard to do.
Evolution of culture at Alpine Investors
Graham Weaver: When we had seven people at Alpine, I remember saying to myself, we can’t hire anyone else, because we’ll ruin our culture. And then we hired someone fantastic. And they made our culture better, and we hired another person, they made our culture better. And like, that’s kind of our bar is each person we hire theoretically, is making our culture better and better, better. So, the first part it starts with, is just holding the bar exceptionally high for the people that you’re hiring. And that sounds really cliche, but it’s so easy to relax that and to start to relax the bar. And that’s the quickest way to kill your culture is to start bringing on people that are not going to raise the bar of your culture.
In terms of what happens when the founder transitions to the culture of the other people. That happens really quickly, because people are, you know, it’s not my culture. Now, it’s our culture. We have roughly 150 people, I think at headquarters now. There are many, many things going on in the firm that I have no idea that that’s happening. And if I had to make it very tangible on what are some things that others have brought, I really think it’s going back to this B Corp where I think we’ve become a lot more focused on our impact on the world and making sure that we’re a force for good and the companies we’re investing in.
Alpine Investors is focused on hiring for attributes rather than solely prior experience. Tell us more about Alpine’s process for screening candidates for the right attributes.
Graham Weaver: Experiences, obviously, what someone has done, and we think of attributes more about who they are. What we’ve learned is that if you’re hiring for let’s just say, I’ll pick a position, let’s say we’re hiring for a CEO of a software company that’s in healthcare, we hire a software CEO who’s had healthcare experience. On day one, that person will outperform someone who has higher attributes, but lower experience. But over time, those curves, you can picture a steep curve with the person who has high attributes and a flatter curve with a person who has lower attributes with a higher experience. And those curves intersect in about 18 to 24 months, and then the entire rest of the time that higher attribute person is going to outperform the higher experienced person. And that in many cases can be dramatic over a long enough hold period.
The most important attribute that we hire for is just this will-to-win. This white, hot burning desire person who’s going to put the company on their shoulders and run through a burning building. And that is something that is going to leap out of the interview process, or it’s not. And that’s something we can’t train. We can’t train will-to-win. We can’t train grit, or persistence or just kind of horsepower. We can teach people how to hire, we can teach them how to build a team, we can teach them how to prioritize. We can teach them the skills of selling, and those kinds of things. But there’s, you know, a few things that we just can’t teach. So those are the really the attributes that we’re focusing on the most and they’re the ones I just said.
Alpine’s approach to retention
Graham Weaver: We categorize when people leave into this is not really a technical term. But, you know, is it regrettable turnover that we didn’t want to have happen? Or was it turnover that maybe the person wasn’t performing or wasn’t the right fit. We thankfully have very little regrettable turnover, it’s not zero, but we don’t have much. And I would say the most common set of circumstances where someone would leave that we didn’t want them to leave, is when someone’s pretty young in their career pretty early in their career. We hire people between their junior and senior years in college to be interns, and then they join us when they graduate.
But if you think about it, the first time we’re interviewing these people, they might be 19, or 20 years old, and they don’t know what they want to do in their careers. Just like I didn’t know. And probably maybe you didn’t know, either at 19, or 20. So they make an assumption that they want to be in private equity. And we assume that they want to be in private equity. And then they join us when they graduate. Now they’re 22, then they do the job for a year. And they might say, hey, this isn’t for me, I actually want to be a professor. I want to go run a tech company, or I want to do whatever it is. That’s the most common form of turnover, just because we’re getting people so early in their career, there isn’t really a common reason we lose people. The other ones would get really idiosyncratic, you know, maybe a family issue or something like that.
Overview of Alpine’s CEO-in-training (CIT) program
Graham Weaver: Well, there’s two beliefs that we hold that most people don’t hold. The first belief is that you shouldn’t change management in private equity. If you go on the website of 100 private equity funds, 97 of them are going to have in the first two pages, we back continuing management teams, we are the partner for continuing management teams. And that’s just kind of like a given, it’s like gravity or the sun will rise in the morning. It’s like taken as law that that’s how you’re supposed to invest in private equity.
We had some experiences, which were pure accidents, early in our career, where we had businesses that were going so badly that we had to put our own people in. And when I say our own people, I mean, like literally, a Vice President from Alpine had to go run the company or principal from Alpine like, packed up, relocated the business and had to run it. A couple of years later, our three best performing companies were all companies where we put our people, and they had started being our worst performing businesses. By the way, they were also our most fun boards to be on because we were sitting on the same side of the table as our people literally because they worked at Alpine. It took us a little while to figure it out. But we said “hey, what if we just do that?” What if we start putting our own teams in every time and so that’s kind of belief number one that we hold. I think that most people don’t agree with the sun. And it’s very, very, very hard to do. We have a whole team of coaches and consultants, that we have a whole process that we’ve developed over 23 years. It’s very easy to mess that up. Even with our IP experience, we can still mess it up. So that’s number one.
The second version of that is the sort of attributes of experience that we were talking about earlier, which is a high attribute person is going to outperform the highly experienced person over a long period of time. And importantly, you’re going to be able to absorb that short period of time where they’re not performing as well. So, we built a lot of machinery around that early period where the high attribute person doesn’t know what they’re doing. And that includes the coaches and consultants. It includes what kinds of companies were buying. The other thing is we do a lot of add on acquisitions. We might buy a company that has $10 million $15 million of revenue, and those are perfect places for young people to start, and they get P&L responsibility, literally the day they graduated from business school. And then they start to build that company and eventually become platform CEO. We have kind of a natural training ground built into our program as well. It’s taken a long time to figure out how and it’s not for the faint of heart. There’s a lot that goes into a lot of training, consulting, coaching. Tou can’t just kind of switch strategy and pray. It’s probably going to be a disaster.
Key challenges in executing the CEO-in-training (CIT) program
Graham Weaver: The people who come into the program are starting at very, very different levels. It’s not like they’re all coming in and going through like an analyst training program. Some of them have run companies, some have been in the military, some have been professional athletes. So, they’re starting very different and then the experiences themselves are very bespoke. This person might be running a plumbing business, and this other person is running a software company. One person has a founder who’s really supportive and one has a founder that’s trying to undermine her. The people are bespoke, the experiences are bespoke. It’s kind of hand-to-hand combat, we have to make sure each person has experienced that’s working. And they’re gaining the skills. And it’s not kind of a cookie-cutter, one size fits all program at all.
Alpine’s approach towards sourcing companies
Graham Weaver: How we deal with the founders starts with how we source the businesses. So, if there’s a founder who says I want to keep going for the next 10 years, our answer typically is well, there’s 5,000 other private equity firms that would love to invest in your business. And we’re probably not the right fit. That’s not because they’re not going to be phenomenal. It’s just that we don’t have any edge there. That’s not really our playbook.
Typically, there is a founder, almost always, it is a founder who has said, “I actually want to cash out, and I want to do something else”. That is the selection that we’re making at the front end. Having said that, I’m a founder myself, and I could just imagine if someone took over Alpine (which they will, eventually). I’m sitting in the background, and they’re making decisions that I wouldn’t make, and they’re maybe messing some stuff up because they haven’t been doing it for 23 years. It’d be very hard to walk. So, founders have that even though they’ve opted to retire, maybe they’re in a Chairman role, or they have some other role, and it’s just hard for them to let go. And I get it. It’s totally normal. So, again, we have a lot of playbook and coaches to help us through that. But it can still be challenging.
Matching CEOs-in-training (CITs) with their respective companies
Graham Weaver: It’s a little bit like the med school matching process where you get into med school, or you get into Alpine, you’ve been hired by Alpine. At that time, you don’t know what company you’re going go to. So, you first in like, December, early January. So right around now, people are accepting jobs to the Alpine CEO-in-training program. Then they have a process where they go interview a bunch of the companies and the CEOs, they learn a lot about the different opportunities, they have different geographic preferences, and some geographies that just aren’t going to work for them. Similarly, the companies are doing the same kind of interviewing and process with the CEOs. The companies will rank their CITs. And the CITs will rank the companies and then we do a matching process. And believe it or not, it’s not as complicated as it sounds, typically, CITs are typically getting their first choice, maybe their second choice. And this company is the same, it just seems to work out. Where the person who likes the company the best, that’s usually the company that likes them the best. And it just seems to work out. It’s not always perfect. But like I said, it’s a bespoke process. So that’s how we do it.
Attracting diverse talent to the CIT program
Graham Weaver: I can’t answer why that is in the room that you went to that had four women and 66 men. I mean, one hypothesis is that there are studies that show that men will consistently overestimate their abilities. They think they’re better than they are. Women probably underestimate their abilities, and they’re better than they think they are. That’s not my own opinion. There are a number of different studies that have shown that that’s a big generalization, but there are a number of different experiments that have shown that.
So I think if you took that one data point, starting a business a lot of times requires some overconfidence because not knowing what you don’t know. And having an inflated sense of your abilities is maybe something that allows people to get over all the unknowns and the fear and all that of starting a company. So that could be one of the reasons systematically why it’s more men.
And maybe some of that is conditioning that men and women are both getting from their society and the environment. Then things like that or looking at the past or things like that. So, I don’t know where all that overconfidence or lack thereof comes from. But that may have something to do with it.
In terms of our program, we try really hard to eliminate that bias. What we’re trying to say to folks is you need no experience. And we’re hiring you for your attributes and who you are not what you’ve done. We’re going to have this path that involves a lot of training and a lot of support and coaching. We’re going to pair you with a coach and a consultant and a board member and an Alpine person and a CEO to be a mentor. We’re trying to remove a lot of the sense that there isn’t that path forward for men or women. And we have close to 50/50 men and women, depending on the year, who go into the program.
And I’m really proud of that, because I would venture to say we probably have as many or more women as CEOs in our portfolio than any other company. And I think it’s because we’re taking the time to make that path available to people who might not otherwise see themselves in that role. And that’s women and minorities and or people that come from the military or other people that just may not see a path for themselves that way. That’s a cool part of the program.
And then it becomes somewhat self-sustaining. If we have a woman CEO, she has a lot easier time hiring women executives, because they see themselves in her. And then other women CEOs see her in that role. And then they see, okay, maybe I could do that. And so, it becomes self-perpetuating, which is also a real positive.
Screening for will-to-win and horsepower in candidates
Graham Weaver: Let’s take will-to-win. It really doesn’t matter, your background, you can exhibit will-to-win. I mean, we have one of our top leaders is a woman who was a ballerina, and like the intensity that she approached, dance was just incredible. And not surprisingly, she’s taken that exact same intensity to her role. We have military vets who they’re just some of the stories that they will tell about what they went through to be successful in some of their missions is just mind blowing. And then we have professional athletes, and we have people who exhibit that in consulting and investment banking. It’s not so much the field in which they exhibited that it’s just that they exhibited it. And it’s one of those things where you’ve done enough interviews over time. Because I mean, if we’re hiring 20–25, CEOs-in-training a year. We’re hiring 15 analysts a year. Let’s say we’re interviewing four times that many, we’ve been doing this for 15 years. Over that period, you have a lot of data points. And that one is pretty easy to screen for because it’s one of those things that leaps out of the interview, or it doesn’t. And if it doesn’t, that’s kind of your answer.
So, what we do, the actual process we do to do that is called Top Grading. And it’s from the book called Top grading by GH Smart. It’s a structured interview where you start in childhood, and you end with yesterday and you go through the candidates experience all the way through all the roles and jobs. From that, you just get all this incredibly rich data on how they showed up in different experiences, whether they worked or didn’t work. And what’s a pretty good process. I think the book says you can get to a 90% success hiring, we probably are in the 80s.
Divergence in hiring outcomes
Graham Weaver: First off, I think the 50/50 numbers for hiring success wildly overstated, on the positive side. Because they’re saying like when you hear that stat, which is correct, you’re right. It is the status 50% of hires workout. When they say they’re working out, they’re saying that person is still employed three years later. That doesn’t mean they “worked out”. So, the fact that they’re there and they’re a warm body three years later, does not mean they were a good hire. I think that that stat I think it’s even worse than 50/50 quite a bit worse, actually.
I said the book was called Top grading. The Prequel was called Top Grading by his dad, Brad Smart. The better book to read is Who:. It’s Who:, that’s the one by GH Smart.
Personal growth and investment philosophy
Graham Weaver: I have a couple of different ways to answer that. I’d say there’s three categories of things, or maybe four categories of things I’m working on, or maybe more at Alpine. I mean, I’m excited about how we can grow and how we can continue to have the performance we’ve had at a bigger scale. We’re holding businesses longer, and we’re creating some new structures to do that, which is super exciting to be able to take your best companies and continue on with them. There’s a new product called continuation vehicles, which is like, really changing the whole industry, which I’m super excited about.
Another role that I have is teaching at Stanford. Every year, I try to add some content that’s going to help students. Like when I first started teaching at Stanford, I teach a class on entrepreneurship. I would teach people hiring and firing and how to have hard conversations and fundraising and all the mechanics and people liked it. And it was a popular class. But then I started realizing no one actually went into entrepreneurship. They learned these tools, and they liked the class, but they didn’t actually go become entrepreneurs. So, I added a whole bunch of material. The class is now about hey, what are your fears and doubts and limiting beliefs and what’s holding you back? And that part of the class has really become larger and larger every year that I’ve taught it. I think that’s actually one of the most important parts of the class. I pour a lot of energy into that what you might call, you know, personal growth, but not just the mechanics of being an entrepreneur, but actually like what’s blocking you from doing that, because we got to overcome that. That’s been really fun to see that take hold with students and to see them actually go in become entrepreneurs.
And by the way, I don’t care if they become an entrepreneur or not. It’s just that they wrote their essay and said that their dream is to become an entrepreneur. So, I want them to do their dream, whatever that is, if their dream is to be a math teacher, then they should do that. But in my class and says, an entrepreneurial class, it’s to be an entrepreneur.
And then personally, I’m working a lot on mindfulness and meditation. And I’ve really been on that journey for the last 2, 3, 4 years. And just realizing how much of your happiness, how much of your world is all happening in your mind. It’s a little bit daunting when you actually start to recognize how much of life is internal versus external. So, I’ve been spending a lot of time on that going on meditation retreats, and having like a meditation teacher and spending a lot more time on that. And that’s been a phenomenal journey, and maybe even the most valuable one, I would say, that’s probably true for anybody who wanted to go on that journey.
Bridging theory and practice of personal growth
Graham Weaver: We could spend a lot of time on this topic. The truth is that every single person in my class or listening to your podcast, ultimately is going to have to go on their own journey, period. Like it’s going to be their journey, they’re going to have their own challenges. They’re going to have their own strengths, they’re going to set different goals, they’re going to have their own way of getting to those goals, they’re going to have their own way of overcoming obstacles.
If I stand up in class and say, “I did X and you too can do X, and I did it this way. And you too, can do it this way”. Like, it’s going to fail, because I had to figure that path out on my own. And a big part of this whole journey is the process of figuring it out on your own.
I think, for you to prescribe personal growth is almost by definition going to fail.
What I can do in my class is I can help people recognize how they’re getting in their own way. I can help unleash them and allow them to get in touch with who they are at their very best.
I can help them get in touch with what they’re really excited about, not because I’m telling them that, but because I’m opening up and creating space and asking questions that allow them to start to come to those realizations. I can allow them to start to develop a path that’s helpful for them. And I think that’s why so much personal growth just doesn’t “work”. It’s because it’s really a lot of times someone prescribing their own path that worked for them, which is also helpful because you might see elements of that that will work for you.
But the difference between coaching and consulting is coaching. You’re saying the person who is receiving coaching is really going to figure everything out on their own. You’re like a vessel to help them really become the fullest version of themselves. And so that’s more the tack that I tried to take in class. And that’s what’s worked for me. That’s why I talked to coaches because I’ve found that to be effective.
The real magic is figuring out the goal. That’s actually 80% of the game, is to figure out what game are you actually playing? How are you keeping score? And what are you actually trying to do. And that sounds probably obvious, but it’s not.
For example, I graduated, and I had this goal to build a business, it took me years to kind of figure out exactly what that meant, and what I was trying to do. And today, like, I still spend most of my energy, actually figuring the goal itself. I think that’s really the difference between something like athletics and life.
And I use this at Business School, because I think this is going to sound very generalization. But prior to business school, generally speaking, the range of possibilities is a lot more limited. So, you’re in high school, then you’re in college, and you have your first job, and you have like a certain number of degrees of freedom.
But Business School is almost like the last time your goals are going to be given to you. And then it opens up and you have almost any direction, any duration, anything, really. And you have 30–40 years to go. The actual process of setting a goal and figuring out what’s important is actually the magic, I think, starting now for the rest of your life. I think that’s actually the real muscle you want to build.
Because you could say my goal is to be a high school teacher and coach, cross country, and impact these kids in this incredible way. And you could have this unbelievably fulfilling life. And that’s fantastic. And you could come up with a completely different goal and like. You’re going realize you’re influenced by third parties, and you have preconceived notions, and you have limiting beliefs. And so, I think bringing all that to bear is, it’s a complex process. And it’s one by the way, that never ends. You don’t figure out your goal, and then you’re done. It’s like you don’t brush your teeth for eight hours on January 1, and then you’re just like, good for the rest of the year. It’s a process. It’s something that you’re continuing to do for your whole life.
Evolution of personal goals and Alpine’s goals
Graham Weaver: I’m going through that process a bit right now, where I think, for example, in building Alpine, the first 14–15 years, like literally, my goal was to stay in business, just literally to like to raise the next fund. And to not go out of business. We started having some better performance. And then the goals started to shift. What do we actually really want to do with this platform? And we came up with completely new goals, be the number one performing fund in the world, be a force for social good, be a place where the best people want to work. Now we’re really spending new time revising those goals as well, like, what does it really mean to be a force for social good? And what does it really mean to be a place where people want to work?
So, I think that that’s changed quite a bit for us over the course of our 23 years in business. And we have the luxury of being able to have goals like that, because we are now in business, and we have a little bit more stable franchise.
Personally, I think my goals have changed quite a bit as well, in the early years. My biggest goal, if I’m being honest, was probably to prove to myself that I was a worthy human, I wouldn’t have said that at the time. But almost everything I did was just to prove to myself, I could do something. And now, I’ve done that so many times in so many different ways — teaching, rowing, investing, physical fitness, etc., that I probably don’t really have that goal as much anymore. And I think a big part of this meditation is to try to figure it out. Okay, now what is the goal? And I’m not sure I have a good answer right now.
Alpine as a source for social good
Graham Weaver: A couple of different ways you could take that, but I’ll tell you a few things that we measure and that we look at. So one big thing that I’m really passionate about is that if you go to Gallup or Harris, have both done polls that show that 70% of people are unhappy in their job. They’re either disengaged or act simply disengaged, 70%.
I just think about how miserable your life is if you’re spending half your waking hours on something that you don’t like, you don’t see the purpose and you’re not feeling fulfilled. The first place we start with is we’ve got tens of thousands of employees in our portfolio.
And the first impact we can have is to try to reverse that and have 70 or higher percentage of people feel attached to the mission of the company to feel like their work matters. To feel like they have people that care about them that they have friends at work that they actually like getting up and going to work.
So, we measure employee engagement, we measure employee Net Promoter Score, employee attrition, employee retention, we measure what percentage of our employees at our companies have a minimum living wage. And those are all things that we pay a lot of attention to.
So rather than saying, “Oh, we’ll back this charity”, which we do, by the way. We spend energy and money on all kinds of charitable things. But what if I said, “Hey, what’s the force that we are?” We’re a big business, if you include all the portfolio companies, let’s start there, and just have the employees be engaged and excited about working. So, we measure all those things, we’re getting about 20 points of positive net promoter score, from the day we buy the business until x number of quarters later. I think that makes a big difference employee’s lives. So that’s probably the biggest thing that we do because it just hits so many employees.
And then there’s a lot of other things we’re doing, we’ve talked about one of them, which is having a platform where folks who wouldn’t get a role to be a CEO, women and minorities in particular, have a really clear platform to become leaders in the company. And then we have all kinds of other things we’re doing, we’re allowing people who want to do a startup, that’s a social startup. We actually have a small venture fund that gives them money to get going.
Because if you have a business school student who’s graduating and they have business school debt, and they have a choice between doing a social-driven company or going to McKinsey, they’re going to go to McKinsey, that’s clear. And they have financial needs. So, we provide funding for people who want to go do something that is going to have more of a social impact. So those are a few things. And we’re figuring it out as we go along to so it’s not static, like anything I’m talking about, we’re continuing to evolve.
If you were coming out of business school again, what would you build if you knew you couldn’t fail?
Graham Weaver: So, the general advice is I’d probably buy a company, and then run it. And the reason I would do that is like, I think a lot of people who start businesses, they actually want to run companies, they don’t necessarily want to start them.
And they’re two completely different skill sets. Getting product market fit, right, getting something from zero to one is very, very hard. And it’s also very low probability of success.
Most of the people, at least that I teach, actually want to run something. And they want to build a team, they want to create sales and marketing, they want to grow a company, I think that they’re better off going the ETA route, Entrepreneurship Through Acquisition route and buying a business, because then they’re actually in the skill that they want, which is building something.
That’s probably my more general advice is its higher probability, I think, you’re going to spend more time doing the activities you want to be doing.
My personal answer, if I were 27. And I knew I wouldn’t fail. And I couldn’t do what I already did, I’d probably go try to build some program like Tony Robbins has built where you could have all kinds of people that have all kinds of walks of life. And they’re all getting blocked or stuck somewhere. And I can help unblock or unstuck them at scale. I don’t know how to do that. I’m not spinning much energy outside of my day job and teaching doing that.
But to be able to really help people kind of get unstuck and live the lives they want to live at scale would probably be my answer to your question. I guess I could do that now, too.
Graham’s recent activity on Social Media
Graham Weaver Yeah, it is. I started taking some of the well first in 2020, I started writing a blog. And then that went well. And I got good feedback on that. And then I realized, I have three teenagers and I realized not one of them had ever read one of my blog. Even though I would send it to them and ask them about it.
So then I started making some videos of my blogs that were in the 60 second Tik Tok version and my kids love them. After a little while a couple of them started going viral, and then like over a period of time for a little while they all went viral. I started realizing like the content on social media, the self-help conteng and on social media is pretty mixed. And particularly on Tik Tok, it’s pretty horrible.
It’s all geared around selling stuff. So, it’s, you know, get rich quick buy this trading platform, trade options, flip houses, buy this crypto, it’s all this kind of just crap where it’s disguised as personal growth or self-help. But it’s really insidious, because it’s typically they’re selling something. But the most insidious thing they’re selling is get rich quick that if you’re not getting rich, quick, you’re failing. And I wanted to be a counter voice to that. And talk about basic stuff like setting intention, setting goals, figuring out where your passions are, and be that voice on social media to kind of, I guess, provide a counter to what I think is a lot of really not great content.
I’m proud of the Stanford speech on living an Asymmetric Life. I put a lot of time into trying to think of that message. And so, it’s done well. And that’s some of the content I’m the proudest of.
How has your message of picking the thing you want to do, and just doing it for a long time, resonated with your audience?
Graham Weaver: It’s one of those things where most of my messages aren’t surprising. They’re like things that you already know. And you don’t want to hear.
Intellectually, people probably know that if they spend a longer time doing something, they have a higher probability of success; if they spend a longer time doing something, that outcome they can actually achieve is much greater than they could ever imagine. They just don’t want to spend a long time doing it.
And a lot of times, that’s because they missed the first step, which is picking the thing that they really want to do. They’re like, well, yeah, I’m in this job, I optimize for the first two years. Now I’m in this job, I don’t love. Of course, they don’t want to do it for a long period of time because they missed the first part; they’re doing something they’re not excited about. If you get the first part, right, you will want to do it for a long period of time. And if you don’t, you still don’t have the right thing.
So, you’re like, Well, no, no, no, I really only want to work for a couple years, then I want to go spend time with my family. And I would say you don’t have the right work, then you still haven’t found that thing. And it’s not that every day is bliss. And you’re skipping to work. I don’t mean that, but I mean, it’s something that if you can’t see yourself doing it for a long time, then go back to step one, you still haven’t figured out that thing yet.
The idea that you’re going to work for 40 years on something that is miserable, then you’re going to retire when you’re 60 and enjoy your life is the stupidest idea that’s ever been pitched to anybody. Think about it, like you want to start enjoying your life sometime in the future. When you’re slowing down, and you’re going to spend all this time in your prime, it makes no sense. It just makes absolutely no sense.
I think that is the prevailing wisdom. And so again, I’m not saying it’s not going to be hard or that it’s going to be easy to find that thing. But if you find yourself just where you can’t wait to get through this, you’re probably in the wrong thing.
Navigating balance between having continued ambition and pursuing contentment
Graham Weaver: That’s a very deep question. And I think it’s a balance that almost nobody ever gets. Let’s take the extreme of contentment, which is, okay, I’m done. I’m declaring victory. I’ve made enough money; I don’t need to teach anymore. My kids are out of the house. Exhale, I’m done. And I’m just sitting here being content that’s actually not making content.
That’s a fleeting moment because contentment for me, and I think for many people, is the progressive realisation of something worthy. The process of moving towards something you find meaningful is contentment is, for me, at least, and I think for many people. We’re wired that way.
So, it’s almost by definition, there’s not going to be a moment where you’re going to stop striving and just be done and declare victory.
Because the very process of striving is probably if you both thought about it, the time you’ve actually been the most excited about life, and the most turned on, and therefore the most content. When people tell you, “Hey, you’re working too hard, whatever”. Yeah, of course, you’re going to have imbalance on either side from time to time. But I don’t think that there’s some place you get to, and then you’re done.
Fundraising Alpine’s 9th fund in a challenging environment
Graham Weaver: Yeah, if I go back to 2008, which was the last time there was a really brutal fundraising market, we were in a very different position. And we did not raise a fund for five years, it was very difficult. And eventually, we were able to pull together enough money to keep going. But what was interesting is at that time. In 2008, 2009, I remember saying, you know, it’s the market, it’s the economy, it’s the great recession. But there were funds that got raised some of the very, very best investors still raised money during that time. So investors, they didn’t have as much money as they have, but they had some and they were still making those bets.
And so at that time, I remember saying, I want to be so focused on our performance that we’re that fund that gets raised or we’re one of those funds that gets raised in the next 15 years, we really just hunker down and focus our energy on net MOIC net return on invested capital, to the exclusion of a lot of other things.
You know, we just said, we want to focus on performance above everything else. 2023, we actually started raising in late 2022. And early 2023, was a brutal fundraising market. The denominator fell, people were over allocated, interest rates were high. So there were a lot of other things they can invest in. There were a lot. I mean, everyone was in the market. So, it was flooded with people coming back. And we got our fundraise, as you said, and we doubled our fund size. And that was based on the last 15 years of trying to make ourselves hopefully one of those firms that gets that raised at that time.
So, we were kind of pulling out of the bank of performance from investing in it for 15 years. I hope that we’ll always be able to do that. And it’s definitely a testament to our team and the effort that they put in over that time.
Single asset continuation vehicles
Graham Weaver: So, a lot of what we do at Alpine probably our biggest play that we run is we find a management team first. That’s the first thing we do. Second, we find an industry. And third, we buy a business. And in Apex’s (Apex Service Partners) case, it was a great management team, AJ Brown and then we found the industry, which was HVAC, which we knew from feeding it previously. And then we bought a small company, and we bought another small company and like, just built this thing, basically from scratch and ended up building the largest plumbing and HVAC business in the world, you know, one brick at a time.
In the process of doing that we built this world class team, we built this unbelievable processes. I think we did over 160 add-on acquisitions, we built an incredible holding company and IT systems and marketing systems and training teams and things like that, when it got time to exit the business from our fund.
We still saw just a tremendously long runway because we built this thing that we were going to own it forever. The continuation fund is basically a way to do that you get to another group of investors that look a lot like your LPs and you set up a new entity and that buys it from the prior entity. And that was just magical for us because we could keep staying in the business. Our existing investors had the option then they could sell out entirely. They could buy more they could roll 100%. They could do something in the middle. So we kind of took some of our investors who were really struggling for liquidity and they completely cashed out others love the company actually bought more. So, we kind of moved the power back to our LPs. And I think you know, it’s not perfect. There’s some conflicts of interest and things like that, for sure. But I think overall, it was a really good solution for everybody.
But the most important part of that is now when we’re buying a business early on, we can really be approaching it like we’re going to be owning it for 10 to 20 years. That just makes you make better investment decisions and operating decisions. You hire better people, you go to different markets. And I think it makes us better investors that that’s now an option. We’re not dressing something up to try to sell it, we’re trying to build it like we’re going to own it forever.
What is something you learned recently that surprised you?
Graham Weaver: Probably some of the meditative stuff about what it’s really like to be totally present in the moment. And how powerful that is?
What is something that you believe that most other people wouldn’t?
Graham Weaver: We talked earlier about the belief in attributes over experience. We talked about the belief of young people and the power that they have. I’d say, so those are two. Another one is that, really, most of the constraints you’re going to come up with are in your mind. And if you give yourself a long enough timeframe, you can set almost any goal and bring it into fruition.
Books or passages that you often re-read.
Graham Weaver: There’s a quote in the book Switch that I would say is the most valuable. I think it’s eight words I’ve ever read, which is find what’s working and do more of that. And that means spend your time on your best portfolio companies, your best people, your best strategies, and don’t worry about what’s not working, just scale the stuff that is working. And that’s the single best passage of a reading a book.
Is there anything new or interesting that you’re reading at the moment?
Graham Weave: I’m reading a book called The Finders, which is about a guy who went and studied 1,000 People who became enlightened. And then he reports on what those people have in common and what it’s like to hang out with them. And its pretty wild book, I have not enlightened, I’m finding. But certainly, trying to go on that journey.
What’s your routine for meditation?
Graham Weaver: Iget up, I get in a cold shower, I lay down and I do like a Wim Hof breathing exercise for 10 minutes, which just kind of puts me in a really relaxed but aware state. And then I try to think about nothing for the next 20 or 30 minutes. And if my mind starts getting distracted, sometimes I focus on my breath. But ideally, I’m just letting my mind go blank for as long as that time as I can.
Is there a leader dead or Alive whose work or style you admire?
Graham Weaver: I read a lot of biographies. So there’s a lot of leaders that I admire, probably the person I learned the most from, which I didn’t realize was my dad, he built a veterinary practice from scratch, taking emergency calls in the middle of the night. And I watched him take those calls at three o’clock in the morning, for 30 years, and just built this company brick by brick and ended up building a really successful veterinary practice, from nothing. And you know, he started that around the time I was born. And I got to see the progression. And I just think living that helped me stay with Alpine for longer, because in the early years, it definitely was like taking emergency calls at three in the morning.
Are you superstitious in any elements of your life? And if so, what’s one example?
Graham Weaver: I think I’m superstitious about karma. I feel like if I tried to do the right thing over and over and over, it’s going to come back to me sometimes it doesn’t seem that way. But even if the only way it comes back to me is that I feel better about the way I handled the situation, then that’s karma in itself. So, I do believe in karma. And I think it’s been a really positive belief to have to believe like if I keep trying to show up the right way, goodness, oh, goodness will come.
