Story
Charles Koch turned a $30M oil business into a $10B/year empire
Sam recounts that the Koch father's oil company made about $30M/year in today's dollars, but 31-year-old Charles Koch took it over after his father died and built it into the largest privately owned business in America, around $10B/year in profit.
“But the 31-year-old brother Charles took it over when the father died and turned it into the largest privately owned business in America. And so he took something that did $30 million a year profit to now probably like $10 billion a year in profit.”
Story
Sell the leftovers, then buy more stuff: the Koch operating model
Sam explains how Koch grew: an oil refinery's byproducts (kerosene, Vaseline, propane) were all sold, and the profits were used to buy unrelated manufacturers like Bounty paper towels, newsprint, and Lycra. The playbook: start or buy a ton of stuff, all flowing from one original asset.
“So they just make stuff that originally started as oil, but now it expands, but it's still like making stuff. And their operations are basically this, like, let's just like start a lot of— start or buy a ton of stuff. And it all started with one thing.”
Steal thisMonetize every byproduct of your core asset, then reinvest the cash into adjacent businesses.
Billy
The 22-year-old who asked 'Is money green?' about the Koch job
Shaan describes a 22-year-old friend he's sure will be a billionaire, who interviewed to run investments for the Koch brothers. Asked if working for them felt a certain way, the friend just laughed and said 'is money green? Okay, money's green. Thank you. That's all I care about.'
“He was like, he just laughed. He was just like, is money green? Okay, money's green. Thank you. That's all I care about. He's like, I, he's so ruthless about the way he, he looks at these things. I find it hilarious.”