Builders & Doers Stanford's Secret: The "Unsexy" Businesses Quietly Making Millions - Jon Staenberg | 15
Jun 12, 2025
Jon Staenberg, veteran investor and founder of Agate Hound Fund focused on search funds and ETA. He explains why elite MBAs are buying “unsexy” businesses like plumbing and dental clinics. He contrasts search funds with venture capital, outlines Agate Hound’s approach, and previews global growth, the Silver Tsunami, and the leadership grit needed for ETA success.
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Why ETA Is Micro Private Equity But Different
- ETA is effectively lower-market private equity but distinct because the playbook (jockey + operational work) matters more than pure deal size.
- Jon warns big funds avoid this space because it's manual, unscalable, and requires hands-on operators.
Stanford Study Validates Strong ETA Returns
- The Stanford dataset shows ~35% net annual returns over decades, robust even after removing outliers and failures.
- Jon uses this study to argue ETA offers attractive, low-volatility, risk-adjusted returns versus public markets' forecasted low returns.
Use The Search Phase To Vet CEO Potential
- Treat the search phase as CEO training: evaluate coachability, tenacity, and decision-making before funding an acquisition.
- Jon emphasizes the year-or-more interview process where funds watch searchers in-class and during outreach.
