95-5 Investment Split
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A discussion about portfolio allocation strategy, specifically focusing on a conservative approach to wealth management with selective private investments.
Core Portfolio Strategy
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95% of net worth goes to "boring" investments
- Primarily index funds
- Considered the safe, stable portion of portfolio
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5% allocated to higher risk investments
- Angel investing
- Private equity deals
- Secondary market opportunities
Example Investment: ConvertKit Case Study
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Company Details:
- $28M in revenue
- 34% growth
- 3.8% revenue churn
- 36,000 customers
- 11-12% profit margins
- Valued at 7x revenue (~$200M)
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Investment Characteristics:
- Secondary offering
- $50,000 investment
- Considered "safe" despite being private equity
- Expected growth of 25-35% annually
- Strong founder with long-term vision (25+ year outlook)
Investment Decision Framework
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Key Factors for Private Investment:
- Trustworthy, ethical leadership
- Proven business model
- Strong unit economics
- Defensible market position
- Clear path to liquidity (either through acquisition or future secondary offerings)
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Risk Assessment:
- Sub 5% chance of significant downside
- Strong product-market fit
- Sticky customer base
- Profitable operations
This framework represents a balanced approach to wealth management, combining conservative index fund investing with selective private market opportunities that have strong fundamentals and trusted leadership.
Sam Parr
Host of MFM and fitness influencer
Sam Parr is a serial entrepreneur and business media pioneer.
In 2016, he founded The Hustle, a business news media company that started in his kitchen with just $12 and grew to eight figures in revenue.
Sam led the charge in making newsletters popular when few believed in their potential.
After four successful years, he sold The Hustle to HubSpot, a publicly traded company. Now operating as HubSpot Media, The Hustle reaches 3 million readers daily, employs a team of nearly 100, and has been the launchpad for dozens of its staff to found their own media companies and newsletters.
Sam remains the host of the popular business podcast, My First Million, and continues to start and sell companies. He also co-founded Hampton, a highly vetted community for entrepreneurs, founders, and CEOs, and teaches people to write better through his platform, Copy That.