Tags
Private EquityEntrepreneurship
Background
Joey Levin is the CEO of IAC, a holding company that builds world-class digital businesses. We cover how he approaches capital allocation, why he tries to avoid centralization between businesses, and what he has learned from working with Barry Diller.
Date
February 15, 2022
Episode Number
264
Key Takeaways
- Unique IAC Operating Model: IAC distinguishes itself with two key attributes: (a) its indefinite time horizon for investments, and (b) a willingness to spin off successful businesses to shareholders. By not being restricted by a finite investment period, the company approaches investments with a longer view.
- Embracing Change and Digital Transformation: IAC has a history of proactively adapting to digital shifts. They have consistently pursued businesses that modernize traditional functions for the digital age. For instance, instead of speculating which online travel platform would dominate, IAC invested in several (e.g., Expedia, hotels.com, Hotwire) because it was evident that the future of travel was going digital. This strategy is evident in their approach to competing even with their ventures if it means being a part of an "obvious future."
- Rethinking Customer Acquisition: He challenged the Silicon Valley notion that only "bad businesses" have CAC, emphasizing that even great products can benefit from efficient customer acquisition. Using the example of trying to market to "plumbers in Indianapolis", he highlighted that if a channel is not yielding profitability, the solution isn't to abandon the channel but to modify the product or supply dynamics until it does.
- Basically inverting the problem (like Munger recommends) Charlie Munger
Transcript
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