Principle
The greatest gift in a partner is making you more ambitious
Choose partners for how much they enlarge your ambition, not only for their capital.
When Long Lake debated which of several acquisitions to pursue, investor Rick asked why not do them all. Taubman says the biggest way investors help is by believing in the team and pushing it to move faster and think bigger.
When evaluating investors or board members, ask which of them has ever made your plan bigger.
Principle
High bar in everything: talent, acquisitions, technology
Taubman's biggest learning: keep the bar high across every function simultaneously.
He links the 3% hire rate on close to a thousand applicants a quarter to the equally tight filter on deals, calling high bar in talent, acquisitions and technology the key to making Long Lake work.
Apply the same selectivity ratio to people, deals and technology choices; do not let one function run on a lower standard.
Principle
If AI triples a salesperson's output, you want more salespeople, not fewer
Productivity gains make people more valuable, so the right response is often to hire more of them.
Long Lake reports significant job growth in its longest-held HOA management businesses: people 50% more productive handle 50% more clients with better service, retention improves and growth accelerates. Taubman calls this a contrarian take against the consensus that AI roll-ups exist to cut costs.
Before using AI gains to cut headcount, test whether demand can absorb the extra capacity; if it can, reinvest productivity into growth.
Principle
Every incremental hire must raise the average
A hire who doesn't raise the team average lowers it over time.
Long Lake is growing from about 55 to close to 100 people within the year while holding this rule. Taubman says recruiting has gone from persuading people's parents to let them drop out to candidates being inspired and wanting to join.
Before each offer, ask whether this person is above the current team average; if not, keep looking.
Principle
Never sell; let great businesses compound
After investing to make a business great, the return is in holding it.
Long Lake has never sold a company and does not plan to; the question is whether it is adding value and whether it should be in the business. Taubman says not being a seller is what makes long-term compounding (getting a little better each year) add up to a staggering outcome.
Underwrite acquisitions as permanent holds; judge them on whether you add value, not on exit timing.
Principle
First-principles durability analysis is the key capital allocation skill post-AGI
Understanding why a business will remain great after AGI may be the most important thing in capital allocation now.
Taubman borrows Malone's root-cause habit from Cable Cowboy and applies it to Long Lake's investment process, noting it is very hard to think 20-30 years out on what will still be a great business, especially now.
For every hold-forever asset, write down the root cause of its advantage and test it against AI disintermediation.
Principle
Minimize threshold resistance for AI adoption
The friction at the point of entry determines adoption more than the value inside.
Taubman's grandfather, a retail real estate pioneer, moved store doors to the front and eliminated steps and dark hallways to reduce threshold resistance, with a continuous-improvement mindset similar to Danaher. Taubman applies the same logic to Nexus: make it so easy and magical that team members just use it.
Audit the first 30 seconds of any new tool rollout and remove every step, login and decision that stands between the user and value.
Principle
Real-economy ROI is what finances the model build-out
The model labs need someone to turn intelligence into real-economy returns, or the capex cycle cannot be financed.
Taubman frames the market's worry about how AI investment gets financed as a question of demonstrated ROI. Long Lake deploys frontier innovations into high-ROI use cases (data entry, process work, toilsome tasks) and frees human capacity for customers and growth, generating cash that flows back into the system.
Position your company where AI capability converts into cash flow; that conversion layer is what the rest of the stack depends on.
Principle
If you have to force adoption, the tool isn't good enough
Owning the company does not mean mandating tools; voluntary adoption is the quality bar.
Even with full control of the companies, Long Lake does not force team members to use Nexus. It treats its roughly 30,000 team members as the customer and design partners, and aims for tools so useful they spread on their own.
Measure internal tools by voluntary adoption; if you need a mandate, go back and fix the product.
Principle
Talk less, do more
Be known for the work, not for publicity.
Long Lake had essentially no public profile (no LinkedIn) while buying nearly 40 companies. Taubman ties this to Midwestern founders who built billion-dollar unsexy businesses quietly, and to wanting partner companies, not Long Lake, to shine.
Default to silence until results are undeniable; let the businesses you build carry the brand.
Principle
AI's bottleneck has moved from intelligence to diffusion
The question is no longer whether AI works but who can deploy it into legacy systems, data and workflows at scale.
Taubman contrasts models that went from failing at addition to solving frontier math problems in four years with an economy that looks largely unchanged. His 10-15 years with founder-owned businesses taught him that real-economy adoption is blocked by legacy systems, legacy data and change management, which is the gap Long Lake was formed to close.
When assessing an AI strategy, locate the binding constraint: in most real-economy businesses it is integration and change management, not model quality. Build or buy the capability that removes it.
Principle
Steer the boat a little every day instead of following a detailed plan
Flexible capital allocation beats detailed strategic plans.
Drawing on Henry Singleton, who disliked detailed strategic plans and preferred to stay flexible, Taubman says Long Lake would never have predicted entering travel; it only found Amex GBT because it kept an open mind about industries.
Replace annual strategic plans with a standing, force-ranked opportunity list you review continuously.
Principle
Technology changes faster than human behaviour
AI diffusion will happen slowly because behaviour, not technology, is the bottleneck.
Taubman expects diffusion across a global economy to happen very slowly and welcomes competitors because the task is too big for one company. He pairs the behavioural bottleneck with hard technical problems in hundred-year-old systems.
Budget more time and talent for change management than for the technology itself.
Principle
Don't sell the platform as software; own the outcome
Vertical integration of platform plus ownership creates alignment that selling software cannot.
Investors have asked to license Nexus; Long Lake has declined. Taubman says changing how businesses and industries operate requires being an owner-operator, and that owning the platform and deploying it only into its own companies drives faster growth, better customer and team member experience, higher pay and shareholder returns.
If your edge depends on behaviour change inside the customer, consider owning the customer rather than selling to it.