A friend reached out last week to ask if I would talk to his younger brother about a possible internship at LEV Capital this summer. The brother is a college student studying finance. I said sure and a day or two later we had a quick call. He explained how he’d analyzed public companies. He asked what our analysis process was like. I said it’s pretty different looking at small, private businesses. The whole call lasted maybe 6 minutes. I was actually more interested to hear about the lawn care business he started and ran for 3 years than about his stock picks. But I honestly forgot to take the conversation in that direction. I figured his goals just didn’t align with our needs and moved on. But he followed up with an email a few hours later. Part of it was…
I was wondering if you could give me a snapshot or short explanation of the more detailed investment work you mentioned at LEV.
So I replied…
We start with an industry or sector that we’re interested in. That might be because we have a target business already identified in that sector and want to learn more about that area and possible acquisition target companies. Or it might be because it appears from the outside to be something that would have good businesses we would like to own. We find SIC code(s) for that sector and have several sources where we can pull lists of businesses based on those codes.
The data we get from that is fairly crappy. So our interns/assistants pour over them validating their websites are still active, they have an active registration with the Secretary of State’s office, and just general google searching to learn basic info. That data gets entered into our tracking system. I give them a cursory review and then whatever passes out of that kicks off a direct mail campaign. Interns/assistants handle printing and mailing for that.
So there’s really not any sort of investment analysis being done by interns. At least not anything like what I think you’re looking for. If you’d someday like to do what I do, our intern/assistant jobs aren’t the best way to do that. If you really want to get into entrepreneurship by acquisition and just generally understanding how it is to own a small business, I suggest you either start your own business and/or go work for as small a business as possible where you can be exposed to the owner and manager. I’m not an investor because I studied finance. I study finance when I need it to solve problems to help my small businesses grow. That’s obviously not the only way into the investing world but it’s my path.
Hope that helps you understand both a little of what we do at LEV and also why I’m recommending what I am.
Keep in touch.