Private Equity market trends and investing techniques

🎧 Guest: Maxwell Nee – Chairman, Family Office Insider & Managing Partner, Black Mountain Capital
🌍 Episode Theme: 10X Deals, Market Gaps & Global Investing

In this episode, Alex Rawlings is joined by Maxwell Nee to explore how thinking bigger—10X bigger—can simplify investing and unlock outsized returns. Maxwell shares his 3-leg framework for identifying high-potential opportunities and dives into emerging trends across waste-to-value, renewables, and infrastructure.

You’ll hear about:

• What 10X deals really mean and why they’re often easier to execute
• The 3 key components of any game-changing opportunity
• Turning waste (like avocado seeds or Guinness beer) into profits
• Where Maxwell is putting capital now: mining, energy, biofuels
• How family offices differ from traditional PE firms
• Lessons from global dealmaking and the role of geopolitics

⏱️ Time Stamps:

00:00 – Intro to Maxwell Nee
01:00 – Founding Family Office Insider during COVID
02:30 – Common PE mistakes: overextension, distraction
04:00 – What makes a 10X deal
07:00 – The 3-leg framework: Market Gap, Team, Funding
08:30 – Real examples: bioplastics, energy, solar
11:00 – Investing globally & understanding country strengths
18:50 – PE vs. Family Office mindsets
21:00 – Book recs: How to Make a Few Billion Dollars, Time is a Tool
22:30 – Connect with Maxwell on LinkedIn

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Transcript

00:00
Welcome back to the Raw Selection Private Equity Podcast. Joining us today is Maxwell Neve, the chairman of Family Office Insider and managing partner of Black Mountain  Capital.  Today we're going to dive into what he's seen from a market trend perspective, how he refers to  10x deals and finding  10x opportunities.  Let's dive in.  Maxwell, if you can share a brief insight into you, please.

00:29
Yes. Thank you for having me, Alex.  Um, I would say  I am obsessed with self-improvement and optimization. So, you know, from business to life, to sleeping, to biohacking, to wearing,  wearing these funky glasses that protected from blue light at nighttime, you know, I'm into all that stuff. I have a lot of the, uh, of the same myself. I've got red light. I've got the blue light blocking Jack glasses looks similar to yours or orange. They are the better for you.

00:58
Um, everything from there. What about things with regards to business, got family insider, black mountain capital as well. Yes. So,  um, black mountain capital is  like our personal investment vehicle.  Uh, family office insider is a community.  It's, it's a bit of a funny story actually. So I,  uh, our family's back was in real estate development and private credit, and we had three buildings under construction during COVID.

01:26
So as you can imagine, like everyone else, we, you know, we totally burnt a whole bunch of cash going through that process, delays, know, labor shortage, everything floods in and out of Australia. And, you know, coming out of COVID, I said to my brother, you know, we really need to outside our comfort zone and get out of this property cycle, you know, cause we basically learn money into property and we build property. So of course we're super exposed.

01:55
properties, not like, so I had an idea and the idea was to put five of my friends that all had family businesses or did, you know, private equity type of deals  into  a  WhatsApp group. And then, you know, two years later, was two years ago. And then two years later, that group's grown into 200 plus,  uh, family offices around the world, mainly around, uh, Asia Pacific  and like some, some of the UK as well.  And.

02:26
I, I joke that it's the largest unmonetized group of family offices in the world because I don't charge any money. don't lose any money. I don't make any money. It's literally just like a discussion group to share ideas and see if we like each other before we even try to do business together. So what's one mistake that you see private equity firms or portfolio companies making and what would you suggest to correct?

02:53
Yeah, good question. So I think everyone is at risk of overextending. You know, some of the biggest mistakes that I've made have,  I've heard this saying, right, which is that the biggest mistakes happen in good times  and you know, real grits and diligence happens in bad times, which makes sense. You know, that  we spent, some of my businesses, we've spent all this money that we definitely shouldn't have spent and we didn't need to spend,  but that's cause times are good. know, times are good. You think that they're going to keep being good.

03:22
And then you overextend and then  the cherry on top of that is you  dilute your focus. Right? So you overextend, try to do, try to add on adjacent things and then it's not a part of the original thing.  And you know, that can really sink you. So I've done that. I'm sure I'm not the only person that's done that or has been a part of that. That is definitely the, um, the, the, painful scar tissue that I've seen.

03:52
Yeah, I speak to my two year old son every day about you either win or you learn, you don't do both.  think we're great  and bad times.  We begin to make the processes, we make the changes, we make the improvements because it exposes what's missing. So on your site, you reference something called  10X deals,  10X used by many, different people and Grand Cordon is probably the one that comes to mind the most. Talk to us about what that means from your perspective.

04:22
Yeah, good, good questions. So in essence, you know, I've worked on things that where the numbers are small, I've worked on things where the numbers are big. And I'm sure a lot of people would have heard this before, but the work is the same. You know, the work is almost exactly the same. Typically the bigger the numbers are, the sometimes the simpler it is to get it done. Because what happens is that when you have the big numbers, you know, 10 X the other numbers, there's less distractions. Because if like, let's say your goal is to raise.

04:51
$5 million, you could speak to a thousand people about raising $5 million. But if your goal is to raise $5 billion, you could probably only speak to 10 people. So it's very easy to eliminate and delete cross-off distractions when the numbers are bigger.  And typically,  if you have something that's worth a $5 billion investment,  you have someone's full attention, you know, because there's less competition  going after that  prize type of thing. So it's just about.

05:19
you where you put your time, how you prioritize, how you focus. And the cosmic joke is that it could actually make your life simpler focusing on 10X rather than, you 2X. So that's interesting. So has that changed your kind of methodology mindset with regards to your investing and your business work? Has that taken you further up the rungs of things and continued stretching with regards to deal sizes, investments?

05:49
What's that changed in your operations? Yeah. It hasn't changed anything in terms of investing because unfortunately I just can't write a 10X check in my own investing, but it has changed where I spend my time. So where you spend your time, the type of things you work on. I used to do a bit of corporate finance and sales for companies that were at like five, 10 million. And then now we're working on

06:19
are large infrastructure projects  that are looking at, you know, 300 million,  uh, know, $2 billion of, of, um, a revenue over its lifetime when it's all said and done.  And,  you know, the work is literally the same. The conversations are very similar, but typically at this end of the market, you're, only dealing with pros  and, and that makes life a lot easier. Um, because you can easily dilute your time and not know you're diluting your time.

06:48
Uh, if you're not focusing, you know, in the right, if you're just not, uh, if you're not in the fast lane, you know, it's, it's easier to find the fast lane when you're, uh, more diligent with what you pick to spend your time on in the first place. So you've also referenced something around a three led framework. What does that, what does that mean? Yeah. So a lot of people are asking, you know, how do you, how do you get into this and how do you start, you know,

07:18
doing  just bigger deals,  uh, you know, like almost exact same deals, but just, just bigger sizes. It's, I've got it down to three things. And I think that if you start with this, uh, anyone can do it. You know, the first thing is you have to find a really big market gap and the market gap has to be like a force of nature. You know, you can't, you can't fudge these numbers. These numbers can't lie. This is a unequivocal data point, you know? So when

07:46
Jeff Bezos founded um Amazon or he used to be a hedge fund guy and he found an interesting data point that said that, you know, incident usage was growing at 2000 % a year. So we thought, oh, wow, you know, in a market like that, you know, you just got to capture a little bit of that market and you could ride, ride that curve. Right. So,  so things like that,  um, you know, big market gaps, some of the best market gaps that I see that I get excited about  is things to do with like waste.  where you're repurposing.

08:15
what someone else might call waste. So I saw one on LinkedIn. don't know how true it is. I haven't fact checked it, but it illustrates the example. Uh, in, in Mexico, one of the biggest industries is avocados. You know, it's like a huge, huge industry, huge pillar of the economy. Uh, think avocados are native from, from that part of the world as well. So, you know, in Australia, we get our Mexico avocados from Mexico. So it's North America. Like that's already, you know, a huge market and.

08:45
Uh, what's a really big problem is the waste. So all the guacamole that's made, throw the seeds away and there's like, you know, mountains of avocado seeds that they don't replant and just, you know, I don't know, they, they burn or whatever they do. Right. So what they've done  is a startup has found a way to recycle avocado seed waste that was costing money to someone else,  you know, um, into a form of.

09:13
240 day lasting plastic and they're turning it into forks and spoons. Right? So you turned, you know, that's, that's what I mean by market gap, like something you just can't argue with. Like, so if you, if you find a market gap like that, typically it's very easy to build a team around that. So there's like a little circle, like a little circle, a market gap, a bigger circle around it, which is the team. And then the last circle is, is the funding. So one, two, three, those are the three legs of a 10X deal.

09:41
Yeah, and that's something similar, actually. Interesting you mentioned, Alana, this weekend that Guinness has a...  When they put shipments into the UK, they have this like tamper protection on it. And every time they put a shipment in, and we're talking huge container equivalents of Guinness  coming across, and if any of it's tampered, they have to get rid of it all. And they were just literally basically pouring Guinness equivalent of down the sink. I'm sure they were doing it responsibly. But...

10:09
And then all the bioenergy companies, well, this is a huge active ingredient. can put this into our bioenergy plants and now Guinness are paying them to take that away. Take the waste. Yeah. they're making that money. That's fantastic. it's amazing what can be done. We see all sorts of different stories of stuff on LinkedIn. You wonder if they're real, but I genuinely know that that story is being used, is interesting.

10:34
What are you seeing? So you mentioned about market gaps, you mentioned about Jeff Bezos and Amazon, so you've got high expectations of answer of this question. What are the market gaps you're seeing? What's interesting for you at the moment beyond the kind of waste to,  or using waste products and turning it into something innovative? Yeah, great. Good question. So ah I'm in all these deals. So I'll share with you some of the deals that I'm in that, you know, obviously got me excited enough to put money into them.  So one of them is  an obvious one, which is, you know, mining.

11:04
So I'm Australian. know a lot of people are mining. I've never actually gotten into it myself, but I happened to meet some business partners that have spent four decades in mining  and they've had three big wins over their time and taking a hundred companies, mining companies public.  you know, mining, the price of gold, the price of silver, the price of copper speaks for itself. And then the cherry on top of that is you have,  uh,  all, you know, like anti-globalization where

11:33
countries are starting to not trust each other and countries that want their own  raw material reserves.  And people are  hoarding reserves now  for themselves. You've got lithium,  people want to have the lithium battery independent from China.  You've got antimony. Antimony is a  material used to harden bullets. You need antimony to make bullets. the only place that makes antimony in the world uh at a large scale is China.

12:03
So like the U S buys bullets from China, right? So, so that, you know, things like that. And then you've also got oil, right? So, so raw materials, um, they've never gone anywhere, but they're immediately in the spotlight and things are getting funded, supported teams are being built around them. You know, the three legs are being built like at record speed right now. Um, another one is, uh,

12:30
Another one  is just looking at my whiteboard  is, um, know, biodiesel, I've got a, biodiesel deal where we're going to take a whole bunch of agricultural waste and put that through pyrolysis and turn that into two outputs, biodiesel,  uh, and, or,  um, an amount of biochar, you know, and biochar is either fertilizer and food and farming and agriculture and that type of thing.  Uh, so that's, that's, that's pretty exciting.

13:00
And then we've also got, uh, you know, energy, you know, energy, energy is an obvious one, right? So, you know, we've the rise of AI, the rise of chips, you know, unprecedented amounts of, of energy usage. Uh, you have EVs that are coming onto the road cheaper than ever. And what all that means is there's two things. The first thing is that, um, you know, if, if everyone, if everyone charged their EV cars and turn on their lights and the air conditioning all at the same time, you know,

13:31
In some places, the grid would explode, literally explode.  So,  so that is a huge market cap. And then you've got not enough energy in the first place because, know,  um, energy needs to be  prepared for, and and it can't take spikes. You know, there's a big spike. There's typically a back, a blackout that follows. So,  you know, doing things like solar,  um,  is  old, boring and not exciting and really obvious.

13:59
but it's never been more valuable, you know, at this point in time. So I'll give you another example. So solar, the price of solar panels,  uh, has reached like a pinnacle point of market efficiency where it'll cost you, uh, 10 cents to generate a watt of solar panels. So to give you an example, if you have a 750 watt solar panel, that's about two and a half square meters.  Uh, you can, you can buy that.

14:28
you know, from China where they made the cheapest for about $75. Right. So  it's cheaper to build a house  out of solar panels than it is out of IKEA furniture.

14:44
So,  so you have the, the convergence  of, um, really cheap solar panels and also the convergence of the highest demand of energy usage and anticipated energy usage ever. So where we're jumping in that is, um, you know, we're looking at a few large scale solar farm projects in, uh, in Asia.  Uh, in particular, uh, the Philippines where they still have blackouts, but there's still not enough energy. And then, you know, where energy is just being.

15:13
sucked up by large infrastructure like Malaysia. There's $150 billion of data centers that are pulled into Malaysia in the last nine months.

15:23
It's like amazing how cheap solar panels are getting. it Wright's law? think it's Wright's law or Moore's law, I can't remember. Moore's law, yes. Yeah. the, making applications that. are, you've on global deals. What are some of the lessons you've worked on, on working on the international stuff as opposed to local? Just ask me that question again. What are some of the lessons you've learned working internationally on your global deals? Oh yeah. I think.

15:53
When you open up, you know, and this might sound very obvious, you know, cause I'm talking to a European, but you know, where I come from Australia is an island. And we're an island that's very geographically far away and also very far away by  way of time zone. So even an international call, uh, isn't always convenient. So when, when you extend your purview beyond, you know, your local market, what you quickly realize is that you should look at  countries  and places to do business.

16:23
as  like, you know, strengths and weaknesses, you know, just like,  you know,  um, just like you're going to build like an NBA team, you know, you got something like jumps high, you know, countries that run fast, but can't run long, you know, and, things like that. So there's, there's attributes to countries that make countries good and bad to do business in.  And  I think that, you know, the really, really largest outsize returns that you generate,  uh, like multi-generational outsize returns.  Um,

16:53
is picking the best, best sort of optimized  thing to work on for that country. So I'll give you an example, you know, um in,  if you were to list a company for liquidity, you know, the U S is the best place to list it because  the stock market has the largest liquidity, right? Like it's, it's, it's pretty simple. If you were to, to go into, um you know, solar,

17:23
Uh, you know, way back when  probably the best place to do it  is, uh, Australia because there's a lot of land and there's a lot of sun, you know, so, so you want to be looking at like those raw material elements that, make business easier and easier to do business in. And then, you know, focusing on that and then double downing on, on that. Does the political side play quite a bit because it's hard enough to know what's going to happen in your own country. Nevermind 10, 15 others that you've got investments in. How much does that kind of.

17:52
draw on, uh, draw on your mind and draw to conclusions of investment on their investment. Yeah, that's definitely a layer, you know? So when you're looking at your market gap, you know, analysis report, one of the sections is geopolitics and that, the paragraph in that section is getting thicker and thicker and thicker, right? There's bigger, more and more considerations. So you definitely want to, um, want to look at that, but I, know, uh,

18:23
It's very easy to say that in hindsight, right? Like I know a lot of people that never saw tariffs coming, you know, and they've made,  they have a hundred year multi-generational business, first time that's ever hit them in that way. So it's a bit like trying to prepare for the next pandemic. Like, how do you know? Do you actually know? And that type of thing.  But yeah, you you should be using past data  to look at future data. So Family Office Insider, talk to us a bit about family offices.

18:52
I mean, there's always an interesting thing with regards to innovation and what, you know, if we talk private equity style family office businesses, depending on what you look at,  what can traditional private equity firms, if you want to use that term for ease, what could they be taking from maybe what some of the family offices are doing and creating obviously good results and returns on that basis?

19:14
Good question. I don't think they, they could take anything to be honest, because they, optimize for different things.  You know, in one, in one sentence, a family office optimizes for don't lose money. You know, that's, that's what they optimize for. That's how they hire, that's how they fire, how they create governance. You know, everything's optimized for don't lose money. In private equity, you optimize for,  um, you know,  leverage, leverage returns.

19:43
You know, how can you  create a baseline of return and then leverage that whilst, you know, having asymmetrical risk so that, know, you get two points of return for one point of risk type of thing. So they optimize for almost opposite things.  And,  uh, that is  when they, they, they sort of clash.  Um, you know,  I'll give you a really  good example. So in Asia, in a lot of parts of Asia, um,

20:12
The person that's hired to be the CEO of a family office as steward is typically the ex, um, private banker that that ran the portfolio. So someone will say, I really like you as my bank. Oh, you know, you've taken me to the formula one for 10 years. And, I really appreciate that. You know, I, I'm ready to start managing my own money. I'm to pay you a quarter of a million bucks a year. You know, how about retiring working for me? Right. So.

20:42
Private banker is not a running and gunning, you know, ex BlackRock fund manager, you know, and running and gunning ex BlackRock fund managers work, work in private equity. So, you know, you've got a totally different mindset, totally different set of priorities, totally different sets of focus and optimization.

21:08
So what do you read, what's listened to? Maxwell, let's you recommend that others should check out please.

21:16
Oh, good question. So there's a, there's a book that I  can find myself just listening to like over and over and over again, whenever I'm on a flight and it's called, um, how to make a few billion dollars by Brad Jacobs. And it's about, yeah, you've got it. Right. It's such a good book. Like it's easy to read. It's it's got it's yeah.  And he gets, gets right to the key points and he's got his own style and flair, which I wish, which I really like.

21:46
Um, I, I love that book,  uh, outside of that, you know, there, there's a few books that are a bit more tactical  about, you know, things like scaling.  Um, there's a book called, uh, time is a tool by, uh, Benjamin Hardy  and  time as a tool talks about,  um, you know, if you want to, if you want to force  innovative ideas to the, to the top, to the front of your mind, then  set a goal.

22:15
set a 10 year goal, set to achieve a 10 year goal in three years, basically. A typical 10 year goal in three years and use that time compression to basically jolt innovation out of you, innovative thinking out of you. And if anybody wishes to reach out to you post this podcast, how best to get in touch, please? I'm addicted to LinkedIn. So you'll get a response from me from LinkedIn. It might be a yes or a no thank you.

22:44
but Maxwell and Neon LinkedIn, I'm the only one there with that name. Well, thank you very much for coming onto the podcast and joining us today. Thank you, Alex. Appreciate it. And thank you very much to all our listeners for tuning in yet again to the PrivateXU podcast. Till the next time, keep smashing it. And thank you very much for listening.