I started working young.
One of the first jobs I wanted was as a busboy. I didn’t get it, so I ended up on a janitorial crew and eventually took over the contract to clean a large medical complex.
I cleaned toilets, scrubbed floors and did whatever else needed to be done.
At the time, I wasn’t thinking about business lessons. I was trying to make money.
But looking back, I learned pretty early that there was no work I was too good to do.
I still think that matters.
I Started in Real Estate at 18
I made my first real estate investment at 18 with roughly $10,000.
It was a land assemblage. After my freshman year of college, I got my real estate license and started marketing it myself.
Eventually, I sold the property to a development company on contract for about 3.5 times what I had paid. Because of the way the deal was structured, the return on my original capital ended up being more than 20 times.
That got my attention.
I liked real estate almost immediately. I liked finding something that didn’t look obvious, figuring out what it could be worth and then having to make the decision with my own money.
From there, I kept going.
I bought more property, developed some, sold some and kept reinvesting.
I did that through college and law school and for many years afterward.
That first roughly $10,000 eventually grew into real estate investments and holdings worth nine figures.
There wasn’t a fund behind me. There weren’t outside investors. I just kept rolling the capital forward.
A $5,100 Service Business
Years later, I started a service business with $5,100.
No outside equity.
No outside debt.
That business eventually grew into a group of debt-free service businesses worth nine figures, employing hundreds of people and operating in markets around the country.
Ultimately, portions of those businesses were sold in nine-figure transactions.
The sale was obviously meaningful, but the experience of building the businesses was probably more important to me.
You learn things when you’re responsible for the whole thing that are hard to learn any other way.
You learn very quickly that revenue isn’t cash flow.
You learn how much the right people matter.
You also learn how expensive the wrong people can be.
You learn that growth can solve problems and create new ones at exactly the same time.
And you learn that a business can look terrific on paper while feeling very different when you’re the one making payroll.
I Still Think Like an Operator
I’ve spent most of my adult life building and running businesses.
That has included hiring people, letting people go, making payroll, signing leases, dealing with banks, buying companies, selling companies and working through more than one period when things got a lot less comfortable than they had looked a few months earlier.
Some things worked better than I expected.
Some things didn’t.
That’s part of it.
I don’t believe operating experience makes someone automatically right about investing. Plenty of operators make lousy investors.
But it changes the way you look at a company.
When I read a financial statement, I tend to think about what is happening underneath the numbers. Who is making the decisions? Are customers actually happy? Is the margin real? Is the business getting better, or is the accounting just getting better?
Those questions are hard to turn off once you’ve run businesses yourself.
How Oksenholt Capital Came Together
Oksenholt Capital wasn’t created by raising a fund.
It grew out of capital generated by businesses and real estate investments over many years.
We invest our own money.
That’s still one of the things I value most about the firm.
There are no outside investors pushing us to deploy capital, and nobody is waiting for a fund to reach the end of its life so they can get their money back.
We can buy public equities. We can buy real estate. We can build a business. We can buy one. We can own something for twenty years.
Or we can do nothing.
I’ve come to appreciate that option more and more.
Public Equities
I came to public markets from the operating side, which is probably the opposite path from a lot of professional investors.
I had already spent decades buying real estate and owning businesses before public equities became a meaningful part of what I was doing.
I think that’s helped me.
When I buy a stock, I try to think of it as buying part of the business.
What does it actually earn?
How much debt is there?
Who is running it?
Are they good capital allocators?
Do they think like owners?
Are shareholders being treated fairly?
What happens if the business disappoints?
And, at the end of all of that, what am I paying?
I like great companies. I also like paying the right price.
The two don’t always arrive together.
I’m comfortable owning something the market doesn’t particularly like if I believe the facts are on my side.
And if I feel strongly enough about an issue affecting an investment, I’m willing to say what I think publicly.
People don’t have to agree with me.
Real Estate
Real estate is still a big part of how I think.
I like tangible assets. I like cash flow. I like owning something where you can improve the property, improve the operations or simply buy it well enough that time is working for you.
I also respect debt.
Debt can be extremely useful in real estate. We use it.
I just don’t want an investment where everything has to go perfectly because the balance sheet leaves no room for anything else.
Eventually something always goes differently than planned.
Building Businesses
I still enjoy building businesses.
Technology changes constantly. Industries change. Consumer habits change.
People are a little more predictable.
Good people want to be trusted.
Customers know when they’re being taken care of.
Culture matters more than people think until they have a bad one.
And sooner or later, every business has to produce cash.
That is probably why I’ve kept coming back to three words over the years:
Love, Loyalty & Cashflow.
Love what you do.
Be loyal to good people.
And don’t forget the cash flow.
It’s not complicated, but a lot of business doesn’t need to be.
Looking Back
Starting with very little shaped the way I think about money.
When you’ve had to create the capital before you can invest it, you’re usually a little more careful about losing it.
I still think about downside first.
I still dislike unnecessary debt.
I still like simple businesses I can understand.
I still believe what you pay matters.
And I still think some of the best opportunities initially look a little uncomfortable.
I’ve been fortunate to build businesses and investments far larger than I imagined when I was 18.
I don’t want that to make the way we operate more complicated than it needs to be.
Find good people.
Own good things.
Pay sensible prices.
Don’t take risks you don’t need to take.
Keep learning.
And let the capital compound.
That’s still the idea.
— Jon Oksenholt