In 1975, roughly 80% of the value in the S&P 500 came from tangible assets like factories, equipment, inventory, and physical infrastructure.

Today, that number has flipped.

The majority of enterprise value now comes from intangible assets instead: software, brands, intellectual property, networks, distribution, and audience.

I’ve been thinking a lot about that shift lately because, in some ways, my own Buy Then Build worldview has evolved alongside it.

When I first started talking about acquisition entrepreneurship years ago, the framework centered around buying cash-flowing businesses.

Manufacturing companies. Service businesses. Businesses with existing infrastructure.

You could acquire existing customers, employees, systems, and cash flow instead of trying to build from zero.

I still believe deeply in that model. I think it remains one of the best paths to wealth creation for ordinary entrepreneurs.

But increasingly, I’ve started to look at a broader category of assets through the same lens.

Not just businesses with cash flow, but assets with audience, distribution, embedded demand, and ecosystems already built around them.

 

 

Now, yes, we’re raising for our latest deal, Build Interactive II. But it’s:

Not just gaming.
Not just James Bond or FIFA.

It’s about the broader evolution of what it means to Buy Then Build in a world where the most valuable assets are increasingly intangible.

 

Not All IP Is Equal

One of the things that makes intellectual property unique is that it doesn’t all behave the same way.

Every business has some form of IP. Some examples:

 

• A local service business develops systems and processes over time.
• A manufacturing company builds operational knowledge and supplier relationships.
• Even a landscaping business develops a playbook that competitors can’t easily replicate.

 

But franchise-level IP operates differently.

James Bond is different from a local brand.
Marvel is different from a traditional operating business.
FIFA is different from a standard media property because these assets carry emotional attachment that has been built over decades, sometimes generations.

People don’t just consume them. They identify with them.

They follow them across platforms, mediums, and product cycles.

That creates a level of durability and recurring engagement that starts to behave more like infrastructure than traditional media.

That’s a big reason why gaming became so interesting to me.

Gaming now generates more global revenue than film and streaming combined. But even more important than the size of the market is the structure of the business itself.

 

 

Once the ecosystem exists, the economics can become incredibly scalable.

Distribution becomes digital. Engagement becomes recurring. The audience becomes global. And the cost of serving the next customer can stay remarkably low compared to traditional physical businesses.

That’s why I kept coming back during the presentation to the idea that “IP scales like software.”

A factory has physical constraints. A local business has geographic constraints.

But strong digital IP can scale globally in a way very few traditional assets can.

 

Legacy Industries Are Being Reorganized Around Audience

One of the things we’re seeing today is that audience ownership is becoming a strategic asset.

The companies creating the largest enterprise values today often aren’t the ones manufacturing the underlying product.

They’re the ones controlling attention, engagement, and distribution around it.

Netflix doesn’t own movie theaters.
YouTube doesn’t create most of the content consumed on the platform.
Gaming companies operate more like ecosystems than standalone products.

More and more, the value is concentrated in the network itself: the audience, the engagement loops, the distribution layer, and the ecosystem built around the product.

 

 

That changes how I think about acquisitions.

Historically, acquisition entrepreneurship was about acquiring operational infrastructure like employees, equipment, facilities, and customers.

Today, some of the most scalable forms of infrastructure are digital and audience-driven instead.

That doesn’t make traditional businesses obsolete. Far from it. I still think acquiring durable SMBs is one of the best risk-adjusted opportunities in the market.

But increasingly, I’m asking the same questions of intangible assets that I once only asked of traditional businesses:

 

• Is there already demand here?
• Is there an embedded audience and existing distribution?
• Can growth be layered onto an existing ecosystem?

 

That’s still Buy Then Build.

The assets may be changing, but the underlying framework is surprisingly similar.

Understanding this shift may become one of the most important ways to recognize where the next generation of high-value opportunities exists beyond traditional cash-flowing businesses.