Okay, here’s a rewritten version of the text, aiming for a more human and engaging tone:
Subject: A $10 Trillion Opportunity on Main Street (And Why We’re Investing In It)
Hey Everyone,
Here at 8VC, we’re always looking at the big picture – the innovations in AI, biotech, and defense that are shaping America’s future. We believe these sectors are critical to our nation’s innovation and economic strength. But there’s something else massive happening, a quiet shift that deserves way more attention: the biggest business ownership change in American history.
My colleague Denis Aven and I have been digging into this, and what we’ve found is both a looming crisis and an incredible opportunity. We’re talking about a potential “extinction event” for Main Street as millions of small businesses face closure… unless we step up.
But it’s not all doom and gloom! This is also one of the best investment opportunities we’ve seen in a long time. That’s why we’re actively working to build the infrastructure needed to help these businesses transition to a new generation of owners. Think of companies like Denis’s new venture spun out of 8VC, and platforms like Mainshares – they’re on the front lines, breaking down barriers and empowering talented young Americans to take the reins. This is about preserving the heart of the American economy.
Think about it: Our Founding Fathers were, in many ways, the original “SMB entrepreneurs.” Benjamin Franklin had his printing press, Sam Adams brewed beer, John Hancock ran an import-export business… They understood that personal ownership fuels innovation and creates accountability – not just for the individual, but for the community.
If we get this right, millions of Americans will continue to own and run thriving small businesses. Local communities will stay vibrant, and a new generation will have a real shot at the American Dream. Instead of just chasing jobs, more people should be thinking about becoming owners – ready to build, grow, and scale. And to make that happen, they need partners willing to invest in them. For those ready to lead, build, and take a risk, the rewards of entrepreneurship are huge right now.
The Challenge: The Silver Tsunami
Every single day, 10,000 Baby Boomers are hitting retirement age. Many of them own the hardware stores, auto shops, and accounting firms that are the backbone of our local economies. The problem? Their kids often aren’t interested in taking over the family business.
This sets up a crisis on Main Street. Over the next two decades, 3 million+ small business owners over 55 will be looking to exit. That’s a $10 trillion wave of business value changing hands! Scarily, almost half of them don’t have a succession plan. And even for those who try to sell, only 30-40% actually find a buyer.
Without a good strategy for transitioning these businesses, many will simply close. We lose the local Little League sponsor, the familiar face behind the counter, and those good-paying jobs that help families weather tough times.
The old model – passing the business down through the family – just isn’t working like it used to. Kids pursue different careers, families move across the country, and sometimes the younger generation just doesn’t have the same passion or experience for running the business.
A New Breed of Owners is Ready
The good news is, there are tons of Americans who are eager to run these kinds of companies. Funds are being created specifically to buy and operate SMBs. But outside of Wall Street, these aspiring owners face huge hurdles:
- Not enough capital: They can’t afford the down payment.
- No transaction experience: Navigating the complexities of buying a business is intimidating.
- Lack of support: They don’t have the right network to help them succeed.
Think about the auto shop manager with 15 years of experience. He probably only has $50,000 in savings – not nearly enough to acquire that $2 million business he’s totally qualified to lead. Plus, he might not know how to value a business, handle due diligence, or navigate SBA loan requirements. And even if he does manage to buy the business, the administrative burden of ownership (payroll, bookkeeping, taxes) can be overwhelming.
We need a platform – like a “Y Combinator” for small business – to make ownership accessible at scale.
(Image of a graph showing trust in small business vs. other institutions)
Why This Is a Massive Opportunity
For investors who are willing to build the right infrastructure, this is a game-changer. Small businesses are the engine of the U.S. economy:
- They represent 40% of GDP.
- They employ over 60 million Americans.
- They’ve created two out of every three jobs in the last 25 years.
Plus, Americans trust small businesses more than just about any other institution right now.
(Image of graph showing small business contributions to the economy)
(Image showing a Mainshares sticker in a shop)
These businesses often have consistent earnings, strong customer relationships, and solid vendor partnerships. Because they’re smaller, they’ve been overlooked by traditional private equity, creating a valuation gap. These businesses trade at multiples that are 2-3x lower than larger companies in the same industries.
Government programs like SBA loans make them even more attractive. And, AI is creating huge opportunities to improve efficiency and profitability.
That’s why 8VC invested in Mainshares. They’re connecting skilled operators with businesses for sale, making dreams of ownership a reality and helping local enterprises thrive.
(Image of a Mainshares map)
How We’re Tackling This Problem
I’m also excited about the new strategy my colleague, Denis Aven, is launching to invest specifically in small businesses.
He will remain a close ally of 8VC, but is spinning out of our core business to create and implement this new strategy.
His goal is to overcome the structural barriers that have kept institutional capital on the sidelines in three key ways:
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Finding the Best Talent: Leveraging his experience building talent ecosystems, Denis will create a pipeline of top-notch operators ready to become entrepreneurs. He’ll also work closely with Mainshares to expand this network.
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Applying Technology & AI: Denis will use the lessons learned from building tech-driven companies like Palantir to help SMBs integrate AI, improve efficiency, and streamline operations. This will enable institutional capital to efficiently access and manage smaller transactions at scale.
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Aligning Incentives: Denis’s strategy is built on a “when our operators win, we win” philosophy. By empowering operators to become true, independent owners, he’s creating a model for long-term value creation.
This is a mission we believe in deeply. If successful, it will save jobs, revitalize communities, and give a new generation a shot at the American Dream.
The time to act is now. Let’s invest in Main Street’s prosperity and keep it running strong for generations to come.
Best,
Joe Lonsdale
P.S. You can reach out to Denis Aven directly to learn more about his exciting new venture at denis@kodiakholdings.com
Disclaimer: The views expressed here are my own. This is for educational purposes only and not investment advice. Consult with a professional advisor before making any investment decisions.