Justin Ishbia: The Three Traits Required to Succeed in Private Equity | E1119

Justin is the Founder and Managing Partner of one of the nation’s best-performing private equity firms, Shore Capital Partners (“Shore”). Since the firm’s inception in 2009, Shore has grown from 4 to over 140 team members managing over $6 billion in AUM, representing 900+ acquired companies and more than 33,000 employees. Shore is also one of the most active private equity firm in the world by deal volume according to PitchBook while continuing to achieve return profiles that rank Shore among the top 1% of private equity firms. Justin is an avid sports fan/investor and is the Alternate Governor for the Phoenix Suns (NBA), Phoenix Mercury (WNBA) and Nashville SC (MLS).
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Timestamps:
(0:00) Intro
(00:55) Childhood & Family Influence
(06:00) Balancing Work & Personal Life
(09:20) Managing Investor Psychology
(11:32) Role of Skill, Hard Work & Luck in Success
(15:30) Managing Competition & Capital Supply
(18:25) Importance of Scale & Efficiency
(23:36) Knowing When to Exit an Industry
(29:10) Benefits of Scale & Economies of Scale
(33:08) Imparting Advice & Wisdom to Operators
(36:31) Preference for First-Time CEOs
(38:52) Recruiting & Retaining Talent
(40:31) Mistakes First-Time CEOs Make
(41:38) Consistently Top-Grading Talent
(44:08) Sales vs. Ops Focus as a CEO
(44:32) Curiosity & Mental Firepower
(47:24) Financial Incentivization & Retention
(48:33) Work Ethic & Self-Awareness
(51:43) Creating a Culture of Success
(55:31) Managing Egos & Motivation
(01:07:15) Fatherhood & Parenting
(01:13:05) Lessons on Money
(01:18:05) Quick-Fire Round
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In Today’s Episode with Justin Ishbia We Discuss:
1. From Law Student to Founding Shore Capital:
How did seeing Justin’s father operate impact how he thinks about building Shore today?
What does he know now that he wishes he had known when he started Shore?
How important a role does luck play in success? How has his mindset changed on this?
2. How to Make Top 1% PE Returns:
Why does Justin see private equity done well like “using a flashlight in a dark room”?
What are the top 3 elements that Justin looks for in all acquisitions they make at Shore?
When did Justin think there was an advantage of scale/network effect but was proved wrong?
How does Justin think about downside protection and risk mitigation?
Why does Justin like to back and invest in first time founders more than any other type?
3. Building World-Class Investing Teams:
Why does Justin believe the best companies are talent systems?
How does Justin structure the talent system at Shore to ensure consistent incredible talent?
What does Justin believe are the three traits required to win in private equity?
What question does Justin ask all potential CEOs he hires for acquired companies?
What has Justin learned is the single clearest sign of the top .1% talent?
4. Justin Ishbia: The Family Man and Husband:
What metric does Justin use to track whether he is being a good and present father?
Is it possible to be top 1% and have balance with a wife and family?
What does “great fatherhood” mean to Justin? How has his thoughts on this changed?
How does Justin think about bringing kids up in a world of immense privilege and ensuring they remain ground and ambitious?
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[@20VC]

Subscribe to the 20VC UA-cam channel for more great interviews: www.youtube.com/@20VC?sub_confirmation=1

[@OHIO_626]

I think you’re looking for happiness in the wrong place

[@allthingsvc]

Justin gives great investing advice but even better leadership advice. One of the best voices to learn from for building a company. Thanks for pushing so many questions on this topic, Harry.

[@Feliz_BroDad]

Harry, did you happen to send him the questions before this Pod? Felt as though he was reading a power point through out.. 56:50 for example somewhere to his right away from the camera, 1:02:51 - 1:03:02, 1:03:20 - 1:03:25 😢

[@Tenbound]

9:27 ... his name is Lieutenant Dan