The most important thing is that in the morning, a ‘money man’ stares back from the mirror, not a broke ‘stock picker’. The operating logic of private equity funds differs significantly from ‘decentralized serial acquirers’ where decision-making largely remains with the operating companies; also, the fee structure is typically much more favorable for serial acquirers. The incentives of the main owners, at least in Röko’s case, are largely aligned with those of the retail investor.
Serial acquirers have most often outperformed the returns of private equity funds. The main reasons are likely:
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Lower costs
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No need to sell; good targets churn out excellent cash flow for longer
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Serial acquirers usually buy smaller, private companies at significantly lower multiples than those for which large PE funds compete.
