THE CASE FOR LEAN AND PROFITABLE: WHY I’M NOT STARTING A FUND (YET)

Hey Everyone,

This week someone asked me a question I get more often than you’d think:

“Why haven’t you launched a fund and started raising a ton of outside capital?”

From the outside, it probably looks like the natural next move. I’ve got a proven model, consistent returns, and strong relationships with borrowers and investors alike. So why not scale this thing like crazy?

The short answer: I’ve done the math.

The long answer—and the real reason—is that I’m not chasing gross revenue. I’m chasing net revenue, personal freedom, and strategic control. And the truth is, building a big fund would work against those goals right now.

Here’s what I mean:

When you go from deploying your own capital to raising tens of millions from investors, a few things happen:

You become a full-time capital raiser.

Compliance, legal, and reporting responsibilities skyrocket.

Your team has to grow. Your operations get more complex.

Your investors expect scale—which means you have to say “yes” to more deals. Even average ones.

Your gross revenue might grow dramatically. But your net margin? That often shrinks just as dramatically.

In other words: you build a bigger machine that costs more, requires more, and keeps less.

I realized that if I just stay lean, use my own capital, and only bring in investors when I want to—not because I have to—I can actually make more money, with less risk, and way more control.

That’s not the popular narrative. The sexy thing is to talk about how many millions you have under management or how fast your business is scaling.

But here’s the reality:

I’d rather own a lean business that nets $1 million a year than a big one that grosses $10 million and nets $500K.

I’m not against scale—but I believe in scaling profitably and intentionally. Right now, that means compounding my personal capital inside a business I fully control, keeping operations simple, and growing when it makes financial and lifestyle sense—not just to impress other people.

So what’s the takeaway for you?

Don’t let other people’s goals become your own. Don’t chase complexity just because it’s popular. And don’t assume “bigger” always means “better.”

A boring, cash-flowing, lean business or investment portfolio that you understand, control, and can grow on your terms? That’s the real flex.

If you’re an athlete, entrepreneur, or high-income earner thinking about how to build wealth passively, ask yourself:

“What would it look like to keep things simple—and still win?”

That’s the question I’m asking every day at 42 Solutions and Kennard Capital.

If you want to keep learning how to build a lean, high-profit investment business, stick with me.

I’ll keep showing you how I’m doing it.

DK 💰