When Most of Your Net Worth Comes From One Company
Most founders and senior executives don’t choose concentration.
It happens quietly, over time, while they’re focused on building something valuable.
Income comes from one company.
A large portion of net worth gets tied up in that same private business—or a single public stock.
Whatever sits outside of that usually ends up in mutual funds or index funds by default.
On paper, that looks diversified.
Structurally, it often isn’t.
And when that concentration works, it feels incredible.
When it doesn’t, you feel it everywhere at once.
I know the feeling. I’m a founder too. For a long time, a significant portion of my net worth lived in one company. That experience shaped how I think about risk more than any spreadsheet ever could.
There are two questions I see founders avoid for far too long:
What happens if too much of your future stays tied to one asset, no matter how good that asset is?
If public stocks become the default way you try to diversify that risk, does the tradeoff actually make sense at today’s prices?
That second question is where things get uncomfortable - but also more interesting.
Stocks Are Still Good Businesses - They're Just Expensive
Let me be clear at the outset.
AI is real.
Productivity gains are real.
The capital investment cycle is real.
There may still be room for stocks to run. High single-digit returns from here would not surprise me.
You’re not irrational to own equities. I still do.
My own exposure is mostly low-cost index funds, alongside a few high-conviction themes in areas like energy, data centers, and AI infrastructure.
But here’s the part that often gets glossed over.
At today’s prices, public equities are trading around ~30x earnings - well above long-term norms. Over much of the past decade, a more typical range was in the high teens to low 20s.
When you combine that with long-term return expectations in the high single digits, something changes.
At the same time, a 10-year U.S. Treasury yields mid single digits.
That means the extra return you’re earning for taking equity risk - volatility, drawdowns, behavioral pressure, and headline risk - is thinner than it’s been in a long time.
This doesn’t make stocks bad.
But it does mean each incremental dollar of risk is paying you less than it used to.
If equities are one component of a broader plan, that’s reasonable.
If they’re the only way you’re trying to offset concentration elsewhere, that’s where things start to get fragile.
When Stocks Stayed Expensive, Real Estate Quietly Reset
What’s interesting is what happened at the same time.
While public markets pushed toward all-time highs, real estate went through a reset that didn’t show up in dramatic headlines.
Rates moved up.
Values adjusted.
Refinancing became harder.
Equity got expensive.
Owners felt pressure.
New construction slowed sharply.
Developers largely focused on finishing projects already in motion while delaying new starts.
In simple terms:
Prices adjusted
Supply growth got cut back
Fear stayed elevated
This is why I keep saying the same thing: the real estate correction many people are still waiting for already happened.
It just didn’t look like a stock chart.
Why This Is Not 2008
Whenever this comes up, the comparison to 2008 is inevitable.
From my seat, the parallels are weak.
2008 was a banking and mortgage crisis driven by loose lending standards, bad loan products, and systemic leverage.
Today looks very different.
Lending is tighter.
Most homeowners have fixed-rate debt.
Many markets still face real housing shortages.
That doesn’t mean prices only move in one direction.
It does mean the reset is playing out through quieter channels.
In real estate, adjustments tend to happen through:
Loan maturities
Quiet distressed sales
Owners choosing to exit
New supply drying up
That process is already underway - and it rarely comes with a clean, obvious bottom.
Where Real Estate Looks Attractive Again
Here’s what surprises stock-heavy investors the most.
In a market where public equities are priced for a lot of good news, you can still find real income at reasonable prices in certain parts of real estate.
Not everywhere.
Not in every asset.
But in the right markets, you can buy boring, necessary housing at yields that didn’t exist a few years ago.
That opportunity exists precisely because fear is still doing some of the work for you.
What We Actually Buy (and What We Avoid)
When I say “real estate,” I don’t mean everything with a roof.
We’re intentionally boring.
Our focus is narrow:
Class B workforce apartments
Mobile home parks
That’s it.
Housing for normal people.
Not luxury.
Not ultra-low income.
These assets tend to hold up because people always need a place to live - and affordability matters again.
But even then, the asset comes second.
Market First. Always.
Real estate is local.
Before we ever look at a deal, we screen the market first.
We look at:
Vacancy and rent growth
Population and job growth
Industry diversity
Cap rates
Landlord friendliness
Climate risk
Affordability
Property taxes
Only after a market clears that filter do we evaluate:
The specific asset
The sponsor
The business plan
The valuation
The debt structure
We say no far more than we say yes.
That discipline matters to founders and operators because they’re not chasing excitement. They’re trying to build something that lasts.
Why This Matters If You're Concentrated
I’m not anti-stock.
I just refuse to let one story control my entire financial life.
The founders and executives I work with aren’t abandoning equities.
They’re rebalancing risk.
They carve off a portion of future stock upside and move it into boring, tax-efficient cash flow.
Their job may still be tied to one story.
Their stock may still be tied to one story.
But their long-term wealth isn’t.
That shift lowers stress.
And it restores control.
A Final Thought
If most of your net worth works for one company and you feel that tension, you’re not alone.
It’s a setup I see again and again with founders, operators, and senior executives who’ve done things right - but haven’t yet stepped back to rebalance the risk they accumulated along the way.
If you want a neutral second set of eyes on how that balance looks for you, I’m always open to a quiet conversation.
- Morgan, Founder of Ocean Ridge Capital
