The Lifco Way

Results are the only thing that matters.

The Swedish tradition

Lifco sits within a distinctly Swedish management lineage. In the 1970s, Jan Wallander revolutionised Handelsbanken by abolishing budgets, pushing decisions to branches, and measuring only results. Percy Barnevik built ABB on radical decentralisation. Carl Bennet, who worked at Electrolux alongside Barnevik, carried the philosophy forward.

When Bennet took control of Lifco in 1998, he installed Fredrik Karlsson as CEO with a simple mandate: buy good businesses, leave them alone, focus on profits. Karlsson ran Lifco for twenty-one years. Under his tenure, earnings grew 100x.

The approach sounds simple. The discipline required is not.

A safe haven

Lifco positions itself as a permanent home for entrepreneurs. The promises are specific: we will never sell your business, never relocate your operations, never impose synergies. Your culture stays intact. Your management stays in place.

CEO Per Waldemarson: “We only want to buy companies that we can hold forever.”

This creates deal flow advantages that compound over time. Founders trust Lifco with their life’s work. Brokers learn which buyers keep their word. In a market where most acquirers strip costs and flip within five years, permanence becomes a moat.

Lifco has made roughly 300 acquisitions. Three have failed to meet expectations. A 1% failure rate across two decades.

The pricing power test

Waldemarson’s acquisition criteria are crystalline: 20% EBIT margin minimum. And one specific test.

“If you can’t implement a 5% price increase, you don’t have pricing power.”

Businesses that pass this test have something defensible. Switching costs, or technical expertise, or customer relationships that competitors cannot easily replicate. Businesses that fail it — however attractive the financials look today — are exposed to competition they cannot withstand.

The test is simple enough that anyone can apply it. That’s the point. Lifco doesn’t rely on sophisticated due diligence to identify quality. They rely on a filter that’s almost impossible to game.

Radical simplicity

Lifco runs 257 companies across 34 countries with a headquarters staff of 35 people. There are no central resources, no shared databases, no operational playbooks.

Karlsson on what he learned from Carl Bennet: “From Carl, I learned the power of simplicity. I was too academic when I was young. And when you are over-educated, you are inclined to do everything yourself because you think you are that good. But he emphasised that one should not go in and interfere after you have given people responsibility.”

The restraint required is harder than it looks. Every acquirer believes they add value through involvement. Lifco’s bet is that the value destroyed by interference exceeds whatever improvements headquarters might deliver. The subsidiary managers know their businesses better than anyone at head office ever could.

Bennet’s rule for his executives: “You can have an opinion on a maximum of two things at any time.”

Numbers over storytelling

Waldemarson: “We’ve just learned that numbers are more important than story-telling.”

Lifco doesn’t build elaborate strategic narratives around acquisitions. They don’t forecast synergies or model integration benefits. They look at the numbers, apply the filters, and buy businesses that clear the bar.

Karlsson was blunter: “Revenues are only troublesome on their own.”

Growth without profitability is a warning sign, not an opportunity. A business that’s growing fast but not making money reveals either pricing weakness or cost structure problems. Either way, it fails the test.

Three experiments

Lifco operates in three business areas: Dental, Demolition & Tools, and Systems Solutions. The contrast between them tells a story.

Dental is focused and mature — Lifco has deep expertise, proprietary products, and a leading market position in Scandinavia. Profits doubled from 2014 to 2024.

Systems Solutions is sector-agnostic — the grab bag where anything that meets the criteria goes. Profits grew 10x over the same period.

The conventional wisdom says focus wins. Lifco’s data suggests otherwise. The discipline is in the acquisition criteria and the operating model, not the sector. Apply those consistently, and the sector matters less than people assume.

What Bennet built

Carl Bennet is now in his eighties. His stake in Lifco is worth roughly $8 billion. The company he shaped — through Karlsson, then Waldemarson — has compounded at 28% annually for a decade.

On why he maintains control: “My focus is on maintaining control over the firms to let them operate with a long-term strategy. Otherwise I can tell you that most of the companies wouldn’t be around, and especially not here in Sweden.”

The Swedish tradition continues. Radical decentralisation, permanent ownership, relentless focus on results. No grand strategy, no operational playbooks, no interference. Just good businesses, well-chosen, left alone to compound.

Simple. Not easy.

Connects to Library: Process Power · Switching Costs · Optionality

See also: The Constellation Model — Similar decentralisation philosophy, but with codified capital allocation pushed further down. The Heico Playbook — Another family-controlled compounder with permanent ownership positioning.