Brad Jacobs Plans to Make Billions in the Building Supply Industry

Joe Weisenthal (0:10)

Hello, and welcome to another episode of the Odd Lots Podcast. I'm Joe Weisenthal.

Tracy Alloway (0:16)

And I'm Tracy Alloway.

Joe Weisenthal (0:17)

Tracy, obviously over the last few years, we've done tons of episodes about freight, logistics, trucking, warehousing, et cetera. And one of the things that has always struck me is just all of this crucial stuff, how sort of chaotic and held together with tape and glue these industries often seem to make.

Tracy Alloway (0:40)

Can I tell you something? My husband and I are rebuilding the shed in Connecticut and just getting the lumber for the shed is this massive production that involves us renting a truck and having to negotiate it from some lumber yard and then bring it back and forth piece by piece.

The industry of all the movement of these physical goods and products, it seems so difficult at times and it also seems sort of ripe for opportunity, but then you also hear stuff like convoy going out of business, right? The freight broker that was supposed to be using new technology to revolutionize trucking and things like that. And so, I don't know, there's like this tension between moving physical products and then using tech to make the whole space more efficient.

Joe Weisenthal (1:25)

Totally, it's one of these areas where it seems like, oh yeah, there must be more simple. Like I remember one of our first sort of eye-opening episodes with Stinson Dean talking about how lumber is distributed and so much of these communications just on sort of message boards or boards that might resemble Craigslist. And then, we've talked about it with Craig Fuller and Rachel Premack at Freight Waves and the idea that you look at how trucking brokerage works, these load boards, and this is all this crucial stuff that's sort of at the center of how the economy works. And it's like they're in WhatsApp groups.

Can anyone pick up a load in Akron and bring it to El Paso next week? And this is how it all works.

Tracy Alloway (2:05)

It seems so informal. And then, of course, it leads to these inefficiencies like trucks running around empty, basically. What's it called? Deadheading, basically.

Joe Weisenthal (2:12)

Yeah, yeah.

Tracy Alloway (2:13)

And things like that. And I guess the question is, what is the sticking point here? Is there something fundamental about moving physical goods that is, I guess, resistant to new technology? Or is there maybe something about the industry where people are making, well, they were, people are making lots of money from lack of transparency in the industry and so they themselves are resistant to new technology. It kind of reminds me of the bond market sometimes and stocks.

Joe Weisenthal (2:41)

Absolutely. Tracy, it sounds like, given the headaches you've had with your new shed, that you could really use some efficiency gains in the world of building products distribution. Could you not?

Tracy Alloway (2:53)

Yes. Yes, especially since I keep messing up the ridge board on the roof. I can't get it straight and then every time I mess it up, we have to go and get more lumber.

So yes, yes, please.

Joe Weisenthal (3:04)

Well, we do literally have the perfect guest, someone whose career I think almost is so odd, Lodsy, in all of the topics that we discuss over the years. He has started, depending on how you count, between five and seven companies, started an oil brokerage, the founder of United Waste Systems, which rolled up waste collection companies, sold to waste management, United Rentals, and then the creator of the Logistics Conglomerate, XPO, which also spun off a freight brokerage, a logistics company, et cetera.

We are speaking obviously to Brad Jacobs, who just a few days before this recording, announced the creation of a new company called QXO, which intends to be a market leader in the space of building products distribution. He plans to make billions of dollars and he's the author of a new book, How To Make A Few Billion Dollars.

Tracy Alloway (3:58)

I like how in the press release for the new company QXO, he basically says he aims to make billions of dollars. So it connects very well with the book.

Joe Weisenthal (4:06)

Well, he has a track record of making billions of dollars. I would love to make billions of dollars. So maybe let's learn something out. Brad, thank you so much for coming on Odd Lots.

Brad Jacobs (4:16)

The pleasure is mine.

Some people think in millions, some people think in trillions. I think in billions.

Joe Weisenthal (4:22)

Very reasonable middle ground between.

Brad Jacobs (4:24)

Middle ground here.

Joe Weisenthal (4:25)