Ryan Kulp, Fork Equity // Micro Private Equity, Buying Companies + Becoming An Owner
In this episode, we discuss the world of micro private equity, buying existing companies with little money down & the philosophy of becoming an owner.
Ryan has a growing portfolio of 7 products, including fomo.com, a popular SaaS Shopify app. He’s doing 7-figures in revenue, all while living a nomadic life traveling the world, coding on-the-go & making music.
1am In Seoul
It’s 1AM in Seoul when I finish recording with Ryan.
He’s been swirling around a glass of “poor man’s sangria” for 2 hours as we spoke like old friends. Meeting for the first time.
“It’s a heavy pour of red wine, tonic water + a dash of cinnamon”
Ryan and his wife, Hideko, landed in time for 2020’s lockdown chapter. Their blog, documents a journey from Mexico City to a forced 2-week quarantine in a Korean hotel.
It’s a different experience from their usual.
A scan of their travels brings me back to my nomad run last year. I flick through their photos like a jealous ex on Instagram.
On the travel blog, they pull in: “number of cafes worked at”, and “cost of living per day” into a dashboard.
You can tell they lovehacking this together. For some, sharing a dashboard like this is overkill.
But it’s the philosophy I’ve seen play out with the savviest digital creators in recent years: Learn in public. Document. Share experiences. And help others to learn.
It’s the 50+ side projects like these that created a foundation for their thriving business. His company, Fork Equity, has a growing portfolio of 7, mostly SaaS businesses, generating millions of dollars, with an impressive 70% margin.
The New Creators
When the Tim Ferriss classic, The Four Hour Work Week, came out in 2007, it changed the way millions of people saw what life & work could look like.
But as we continue to evolve towards more flexible work in 2020, Ryan’s example stands out as the more authentic version. A new type of creator.
Not one showing off about how little he works. He works a lot. Every day. But one who chooses what his day looks like.
He takes pride in being a self-funded, “bootstrapper guy”, owning the majority of his business as a consequence. And yet, his deepest drive to earn money comes from wanting to have the time to make music.
He tells me about his transformation from marketer at YC & Techstars startups, to a self-taught coder building his own apps.
His journey into full-time ownership has been a combination of starting, buying & growing businesses. It’s a unique path we can learn a lot from.
What It Looks Like In Practice
This isn’t a cheesy ad with a lambo & a promise to drink pina coladas on a beach.
His first acquisition, now fomo.com, is a popular shopify SaaS app, which he acquired for “six figures” when it was doing $15k/month in revenue.
He’s grown that to $100k/month, while still buying more companies through his fund. And that expertise is what we go into in this conversation
Like Buying A House: Micro Private Equity
But what if you don’t have money to buy?
In the same way you get a mortgage to buy a house, we talk through the unique opportunity to apply this approach to companies.
We breakdown concepts like: seller financing, clawbacks, and leveraging debt vs equity.
These are powerful tools in any entrepreneur’s toolbox.
What You’ll Learn
ownership of your actions + becoming an owner in business
building from scratch vs buying an existing company
thinking through career transitions + knowing when to leave your job
how to work with a romantic partner
partnering with investors to buy companies
self-funding vs raising investment
why job security goes beyond the company you work for
his first 6 figure acquisition
why someone would sell a business in the first place, and what to look out for
seller side financing + how can you use it to buy a company with little money down
SBA loans + how you can use one to acquire a company
dealing with people who have negative energy
scaling a team beyond yourself
Time Stamps (YouTube)
00:00 welcome 01:42 why ryan landed in korea 04:46 learning languages 05:57 not pitching 08:43 ryan’s background 09:31 learning to code + becoming an owner 11:40 bootstrap vs venture capital 15:07 pros + cons lists 17:14 raise to make your vision bigger 18:51 nuance + balance from extremes 22:42 importance of becoming an owner 25:33 54 side projects + 7 companies 28:13 7 figure revenue, 70% margin 28:49 running a business with a romantic partner 34:27 knowing when to leave your job 45:52 job security + your own skillset 48:42 why buy vs build from scratch 51:57 do I need money to buy? 53:22 buying fomo.com with no money down 59:23 how to value a small business 63:23 what is seller side financing? 64:33 what is a clawback provision? 65:33 why would someone sell a business? 67:43 “it’s too good to be true” 71:32 two types of people, which one are you? 74:27 dealing with negative energy 76:36 debt vs equity to buy companies 78:01 using SBA loans to buy companies 86:26 business returns vs real estate vs stocks 87:31 be fearful when others are greedy, and greedy when others are fearful 89:57 partnering with investors to buy a company 92:59 scaling a team beyond yourself 97:32 being conservative in tech 99:47 types of luck 103:28 what’s stopping you?