Host: Welcome to episode 100 of Acquiring Minds. To celebrate the triple digits, I thought I'd do something a little different. Today's episode is five mini interviews with previous Acquiring Minds guests, guests who came on a year ago or more. I wanted to know how their ventures are going one year later and how they feel now about that huge decision to buy a business. Hopefully some of you have been listening long enough to recognize these guests. Chris Edwards, who acquired a flooring business. Philippe van Der Heydonk, a B2B media business in the pets industry. Cassie Nee Camp, a fencing business. Andrew Pierno is buying multiple small sass businesses and finally Mike Bodkin, who bought a small landscaping business and has quickly parlayed that into becoming a player in the landscaping industry. Each of these conversations is just 15 or so minutes long and you can consult the Show Notes for links to all these folks original episodes. Please let me know if you like this kind of one year later format. I know I loved reconnecting with these guests and learning how they feel about their decision and what they've learned. I could totally see making this a regular Acquiring Minds feature, but I need to know if you like it too. Lastly, thank you for listening. Building Acquiring Minds has been one of the most invigorating and gratifying phases of my career. Here's to the next hundred episodes. Welcome to Acquiring Minds, a podcast about buying businesses. My name is Will Smith. Acquiring an existing business is an awesome opportunity for many entrepreneurs and on this

Host: podcast I talk to the people who do it.

Host: Wouldn't it be great to have experts at your back when buying a business? People to help you polish up your pitch and processes as you go to market as a searcher, then help you evaluate opportunities once you get some deal flow. Such experts exist buy side Advisors, but they'll cost you to the tune of tens of thousands, even hundreds of thousands of dollars. But another option exists, the Acquisition Lab. The Lab is a do it with you buy side advisory service, not do it for you. Founded by Walker Deibel, author of Buy Then Build, the Lab represents Walker's vision for what is most needed to make a searcher successful and available at an accessible price. It's cohort based and you will come out the other side of your cohort prepared to go to market as a savvy searcher with a tight message and process so brokers take you seriously pre approved for a loan and with an entire community at your disposal to help you along the journey to buying a business. To learn More, check out acquisitionlab.com, link in the show notes. Okay, here is the first mini interview with Chris Edwards. Chris's was episode 19 from August 2021 entitled how to Survive acquiring a $3.5 million flooring business. Chris Edwards, welcome back to Acquiring Minds.

[3:06] Guest 2: Will, how are you doing, man?

Host: Good. Good to hear your voice again, Chris. You were on Your episode aired August 2021, so about 14 months ago and you had acquired a flooring business in Steamboat Springs, Colorado. And we're not going to be able to rehash the entire episode. I will of course link back to that for people to refer to, but we just really want a quick update on how things have gone in this, in this last year, 14 months since we spoke. Chris, we why don't you give me just 30 seconds quick refresher on the, on the acquisition itself, what you bought, what you paid, all the, all kind of all the relevant bullet points and then, and then tell us, you know, give us an update 14 months later.

Guest 2: Yeah, sure. Yeah. So I bought a, about a three and a half million dollars revenue flooring business at the time, bought it for about 2 1/2 times SDE. Total purchase price was about $1.75 million. Funded it 80% SBA debt, 10% seller note, 10% equity, and since then have been full time operating this business. We've grown it from about three and a half million to probably will come in a little bit less than 5 million this fiscal year. So we've grown it quite a bit. Been able to maintain healthy margins, SDE has expanded, been able to pay down, you know, my SBA debt, been able to pay myself, been able to, you know, do some, some distributions and I actually used the, some of the cash from the business to buy a another business called Granite House, which is actually right next door to Affordable Flooring. So it's a granite countertop fabrication and installation business. We mostly do quartz and natural stone, but it's really complementary to what we do at the flooring store. A lot of customers that are, that are looking at flooring are also considering redoing their counters and vice versa. So it's been a little, it's been a nice little tuck in acquisition. It did about a million of revenue last fiscal year. I think we're on track to probably do around 1.5. So it's definitely smaller than the, than the flooring store, but still is a nice little business in its own right.

Host: So when you refer to the $5 million that you're targeting for growth, that's just affordable flooring. That's not the granite business. So together it'll be. If you hit your numbers, it'll be $6.5 million of revenue that you're doing across your two businesses.

Guest 2: Yeah, something like that.

Host: Okay, well, Chris, that's phenomenal. Congratulations. That sounds like it's been a really good year. Chris, I want to reflect back on your interview from last August. You know, you use this phrase that I then used and reused about the bloody knife fight that is small business ownership and that I was. I was quite early to learning about this world myself and, and probably was among people who idealized the idea that you can go out and buy a business. And it was people like you pointing out that operating a small business is very different probably than. Than any other professional work that you might. Might be coming from. And you had said that the first six months in the seat as the owner of Affordable Flooring Warehouse were the hardest six months of your life, easily. But when we were talking things, you started. You were starting to feel like you were getting your arms around the business and that you kind of come out the other side.

[6:51] Guest 3: You.

Host: You were. You were not coasting by any means, but you felt like the worst was behind you. Can you kind of reflect back on that and. And maybe respond to everything I just said? 14 months older, wiser, grayer.

Guest 2: Yeah. I mean, I was just joking with my wife last night that, you know, I've had a couple people, like, ask how old I am, whether, like, they, they. They'll just be like, you're in your 40s, right? And I'm like, I'm 32, so I think I've aged quite a bit operating this thing. I got a little bit darker bags under my eyes, and maybe I'm just a little bit more jaded overall. But, you know, it still is a bloody knife fight. You know, it still is hard. You know, it's not, It's. It's still a challenging thing to make this thing hum at a high level. So, you know, I feel like it's. It's one of those things where small businesses never, Never shorts you on opportunities to challenge yourself. So it still is. It still is challenging. And I still have a lot of, you know, moments where it's really difficult, but it's gotten a lot easier. I don't, I don't stress as much. I feel like I'm able to take the punches a lot better because they just keep coming, you know, they just.

Guest 3: I don't know.

Guest 2: I don't know what it is, but it just feels like whenever you feel like you got things under control. There's something that's there to smack you down and humble you. So overall, it's gone well, it's gone better than I forecasted or anticipated. When I was looking back at my financial modeling of what I thought I could do with this business, I exceeded those, which is really positive. I've, you know, I feel like this is a really great lifestyle decision for me, long term, even though it is difficult. And I, There are times where I wish I was kind of back in my consulting lane where I'm just kind of doing projects and there's not a ton of pressure, especially not like, putting my financial, you know, not on the line. But, um, you know, overall, it's, it's been, it's been good. Um, the bloody knife fight persists, you know, between customers and, you know, employees and, you know, suppliers. There's always something to keep you on your toes. So there's never. You can't really just take a breather. And at least I haven't been able to, to the, to the degree that I hope I could five years from now. Um, so it's been, it's been pedals of the metal. I mean, I'm working, I'm working seven days a week, basically. I take a day off here and there. But, yeah, it's. It's intense. But overall, if you ask me, would I do it again, would I go back 14 months or whatever it was 16 months and do it again? I would say yes.

[9:47] Guest 3: Great.

Host: And did. Do you. I don't recall if you anticipated working seven days a week.

Guest 2: I, I don't know. I, I think it. I, I probably was somewhat expecting that, but, yeah, it's gotten, I would say it's gotten better over the last, probably six months now that it's not like I'm working seven days a week, you know, 12 hours a day, I, I'll come in on Saturdays and Sundays and work for three hours each, you know.

Host: Yeah, yeah.

Guest 2: But, yeah, so there's. There is some flexibility. I want to make it sound like I'm always working, but. Yeah, I mean, I have a pretty, pretty. I would say I was working those hours even when I was at consulting to some degree. So I wouldn't say it's changed like a ton, but I am definitely working pretty hard still.

Host: Okay, well, one of the things that you had your eye on, as so many people, acquisition entrepreneurs do, maybe all of them, is eventually being able to put in an operator so that it's not, you know, that you're not, you're not, you're not engaging in the knife fight yourself. You're paying somebody else to do that. Of course, that is the hope and the dream and way easier said than done.

Guest 3: Yeah.

Host: Do you feel now, 14 months later that you're any closer to that or does that still seem like a distant dream?

Guest 2: I wouldn't say it's a distant dream. I would say it's still, I would say it's a more like medium term type of dream, not long term or short term. I definitely am like doing a ton of different things here, making the whole thing run. But yeah, I would say it's getting closer. I've had some interviews with some operators that I've tried to bring on and for every reason didn't work out. So probably one thing that I would, you know, coach myself on if I were an outside consultant would be to, you know, start hiring and focus on that more. My, my wife is constantly in my ear about making, about trying to find someone to help me out and an operator to come in and, and make this thing go. So that, that's definitely a, a, a big next step for me. And, but right, right now I feel like I'm a little bit of a control freak. Too much. You know, every single dollar that comes in and out of the store I'm looking at and so I need to let up the reins a little bit. I need to get better about hiring if I'm going to take kind of the next step and what I believe my career path should look like. So that's something I need to focus on.

[12:24] Host: Interesting. So it sounds like it's not like the, like the business and your ownership of it is at a place where in theory you could hire an operator. It's more like a psychological barrier that you have that you're just, you're just, you know, this, this giant financial swing that you've taken, you're not yet ready to entrust it in, in somebody else's hands.

Guest 2: Yeah, I mean, I think, yeah, for sure. In as, as, you know, really what the, the best thing about this game is that time is on my side. That as time goes on and as I continue to, you know, generate cash flow and pay down debt, I'm less and less leveraged and less and less, you know, at risk of something really bad happening. Right.

Host: So like, totally.

Guest 2: I feel like, you know, once I kind of hit that like two year mark, it's like, okay, I've, I've generated a lot of value, I've created a lot of Value. You know, the risks that I was worried about a year ago have largely been mitigated. You know, the risk of going BK is virtually gone. Um, so, you know, it's. It's not to say that I would get complacent, but once you. Now that I feel like I'm continuously de Risking. De risking, then I would be able to feel more comfortable, you know, entrusting someone to operate my baby, you know?

Host: Yeah. Yeah, sure. And just so I understand, is there something. I totally get the idea that the, you know, the more of your debt that you pay down, the more out from under any, you know, gun to your head you are, financially speaking. But is there something that after only two years, it seems like. I'm sure you still have a very hefty SBA payment. What has happened that has made you so much more comfortable? I guess also you've increased revenue a lot, so you have that much more cash flow to pay down the debt. So that must be the breathing room you're talking about.

Guest 2: Yeah, exactly. And just having that sort of track record of financial performance, now that I've seen it and I've seen it replicated over an extended period of time, it's like, one year is great, but then, okay, let's do it again for a second year. And so it's kind of arbitrary. I'm just throwing that out there. But I would say two years of strong operational performance is. It de risks me.

Guest 4: I pay down debt.

Guest 2: I've got more working capital in the business. You know, it feels like.

Guest 5: Okay.

Guest 2: Like there's. There's a buffer here that I can work with to.

Guest 3: Yeah.

Guest 2: You know, take a bigger step and, you know, hire an operator or whatever the case may be. So, you know, and I now. Now that I've. Now that I've. Now that we've grown and we've, you know, SDE has grown, you know, the. The multiple that I bought it at is sitting at, like, you know, two times. Right. So it's like, okay, I've largely basically created the value of what I bought it for in two years.

[15:24] Guest 3: Right.

Guest 2: So that's. That's kind of how I. I'm just kind of arbitrarily thinking about it.

Guest 3: Yeah, that.

Host: That's phenomenal, Chris. Yeah.

Guest 3: And.

Host: And I guess experience itself is. Is kind of give one. Gives one confidence. So you've been in the seat for two years, and you just. You feel like you.

Guest 4: You.

Host: You got your arms around things. You understand it's still hard, but, like, you're no longer green. Yeah. One more, one more question before I let you go, Chris. You. One of the big challenges that you had when you got in there is by your own admission, you tried to implement changes too quickly, which is, I've now learned, is kind of a classic acquisition entrepreneur rookie error. You know, they have all these ideas for things that they want to change and you know, introduce all those things on day one and people and their new employees freak out and that, that bit you in the butt a little bit as well. But so have you now had the chance to implement some of that stuff? And, and how, how do you think about, you know, the change management that you've, that you've led here for the last 14 months?

Guest 2: Yeah, for sure. I mean, definitely has, that's been, we've been really focused on operational improvements, especially I would say the last like nine months. You know, our, our quoting process is much more efficient. Our, our inventory management, our accounts receivable, accounts payable, much more efficient. We've hired outside offshore resources to help out with the business technology. Implementation has gone well since I think we last talked. There's some hiccups there, but the adoption of the new technologies and systems that I brought to the table have been mostly well received. So yeah, I think, you know, the first, you know, I think when we, when I first started doing these changes, I was probably like three months in and it was, it was just too early. I was still learning and I still am, I'm always learning. But now that like kind of had that operational experience and have some reps under my belt, it's easier to make changes and bring new ideas to the table and get buy in. Now that I've kind of hopefully earn the respect of the employees and the people that are ultimately using these tools.

Host: Sure. Yeah, absolutely. Makes sense. Well, Chris, I don't want to keep you. This was an awesome update. I'm so thrilled to hear that things are going so well and you've got so much confidence that you're buying, buying out your next door neighbor. No, that's really cool. I'm sure that's a story in its own right, but I want to keep this short and sweet. Thank you sir for coming back on. Congratulations on your success and maybe we'll talk again in, in 2023.

[18:11] Guest 2: Yeah, sounds good. Thanks Paul. Appreciate your time.

Host: I hope you enjoyed that. Catch up with Chris. Here's the second mini interview with Philippe van der Heydonk. Philippe's was episode five from May 2021 entitled how to acquire your first business in three months. Philippe Van der Heydonk. Welcome back to Acquiring Minds.

Guest 5: Thank you very much for having me, Philippe.

Host: We recorded your episode in May 2021. So almost a year and a half ago, you had acquired Pets International, a B2B media business for professionals in the pet industry. So I want to spend a few minutes with you hearing how things are going. A year and a half later, can you share with us, kind of big picture what life looks like at Pets international now in October 2022?

Guest 5: Yeah, for sure. I think since we last talked, a number of things have changed. I hired some people, I think at the beginning, for a long time, I was doing a lot of things by myself, obviously with like a big team of freelancers, but a lot of the core things I was doing by myself. I have now two team members about to hire someone, like a third person. So that is growing. We've done a major transition to a new CRM system. So we previously had like a custom build one. Now we've moved on to something else that is 98% complete. There's been a lot of work, but it's almost done. We've done a new website, a redesign of the magazine. Yeah, quite a lot of things.

Host: Okay. And overall, I mean, you're hiring. That's always a positive signal. But how would you say things are going? I mean, how is the business performing compared to a year and a half ago, the business.

Guest 5: So our fiscal year runs until June. So if we look at last fiscal year, we've grown a little bit. I think going into this business, I knew it was not going to be like a high growth opportunity. It was going to be more like a pretty stable, sizable business that has some room for growth, but not like 20% year on year for the next decade or something. So there was some healthy growth, not too much. So everything is going in the right direction and according to expectations, let's say.

Host: Okay. Okay. Well, that's. I would say that's. That's positive. I mean, your pro forma is playing out. And Philippe, give us a. Just a refresher on kind of the bullet points of the business. Like more about what Pets International does. Revenue and margins, to the extent you can share that revenue mix, because you had various, you know, you have a magazine, you have conferences, age of the business, deal terms, just, you know, bullet points, if you would, to refresh people's memory.

[21:07] Guest 5: Sure. So we've been around since 1988 longer than I've been around, actually. It's basically a B2B media business with a literal print, physical Publication as kind of like the flagship product. Let's say we do some online publications as well with a newsletter website, and then we organize events as well, both in Europe and in China. Well, now obviously with COVID the China part is not happening as much. And then in terms of size, we're low seven figures. And I think revenue split probably events would be maybe 35% of revenue and the magazine and the online stuff would be the remainder.

Host: And the online, the magazine, do people pay a subscription or is it just sponsors is how you monetize it, or both?

Guest 5: It both, but to the large extent it's advertisers who, who pay the bills.

Host: Okay. And. And you're Dutch. The business is Dutch and Belgian.

Guest 5: But yeah, close.

Host: You know, I, I think I made that mistake in our, on our original interview. I, I can't seem to absorb this fact.

Guest 5: Sorry.

Host: Okay, you're Belgian, but you, but you live in the Netherlands and the business is Dutch.

Guest 3: Yeah.

Guest 5: Yes.

Host: Let's see in 2023, if I get that right.

Guest 2: The.

Host: But it, but it is Pets International. So the, the entire global pets industry is your target market. So you have. So you're shipping magazines all over the world?

Guest 3: Yep.

Guest 5: Okay. Okay, great.

Host: And is it, is it more like, are, are most of your readers concentrated in say Europe and North America versus Asia or is it pretty evenly distributed or what? It's an, it's an English language magazine.

Guest 5: It's English language, yep. It's 50% in Europe, maybe a third third in North America, and then a quarter or so in. Or 20% or so in Asia. And then you have a few copies going to like South Africa or Argentina or Brazil, stuff like that.

Host: And these new hires. So. Sorry, you said two new hires and an effort on the way.

Guest 5: Yep. Okay.

Host: And, and what were the roles?

Guest 5: So the first hire was an editorial manager to kind of take the content side of things off my plate so that he, he basically runs that. And then I have an operations manager who helps with kind of like the nitty gritty stuff of all the other things. And yeah, the next person I'm looking to hire is a little bit, I guess, hoping that person to be the person who can replace my day to day completely. Like all the things that I'm still doing. Hopefully that person can pick that up and then I'm free to do other things.

[24:00] Host: And what, what are the things that you're doing day to day that this person would take on?

Guest 5: Sales, Some of the sales management. I mean, we work also with agents, so kind of working with them on the sales side. So marketing stuff, the event stuff, I do a lot of that still, I guess those are the major kind of pillars, let's say. Okay, okay.

Host: Well I. If you make this third hire and that frees you up completely, that sounds like within two years you will have kind of completed the, you know, you had envisioned bringing in, you know, people under you, an operator. Obviously, you know, it's going to be more than just a single person. Sounds like three people. And then continuing on your way to buy more businesses and continue this path. It sounds like if you make this third hire, you'll kind of be there and you will be free to explore, you know, the next acquisition or I don't know, you'll have a lot of free time, am I right? And that's pretty cool to have done that in two years. August Felker is a two time successful searcher. First with a traditional search fund. The second time around he did a self funded search. Today August runs Oberle Risk Strategies, an insurance firm with a dedicated practice group for searchers and acquisition entrepreneurs like you. If you've got a business under Loi Oberle will provide complimentary due diligence on that business's insurance and benefits program. A great no risk way to get to know August and team. They love helping searchers. They've worked with hundreds. Oberly is a specialty insurance brokerage for searchers by a former searcher. Check out oberly-risk.com O B E R L E- risk.com link in the show notes.

Guest 5: Yes, but I would think I'm also pretty realistic about. Yeah, I'm not convinced yet that I mean it all depends on who you can find. Right. If you find the right person who can actually take over, that will be great. So I think the scenario where I'm leaning towards more right now is to find someone who can take over my current day to day so that I can maybe potentially look at acquiring a different publication to make the publication group as you want to call it, if you want to call it that, a little bit bigger so we can kind of get a full time designer instead of like freelancer, I don't know, expand the team a little bit more and have a little bit of a bigger business and then that person would first run the global heads and the pets international side of things in the beginning and then could potentially move up to the next level once the integration of new publications have been completed. I guess that's like right now the main thing I'm toying around with but I mean let's say it all starts with finding the right people and actually getting them up and running and then seeing how things go, I think.

Host: Sure. But it sounds like if you're able to do that, the next acquisition, you wouldn't then go out and buy some new unrelated business and kind of start building a holding company. You would buy a business in the. In the pet space, in publishing to grow the existing Pets International business.

[27:15] Guest 5: Depends. I think at first I was always like, okay, let's get just a completely different business because I also like to be involved in different businesses. So right now the thought would be to get another publication on board. Whether that's in the pet industry or not, it doesn't really matter as much. Just to kind of centralize a couple of those, I guess, key roles in the. In the publishing business, like editors, designers, things like that. So once you have a little bit of a bigger scale, you can just bring all those things together and you can save a little bit on cost as well. So you kind of net. Net out, come out a little bit better.

Host: Okay. Okay. So really, it's kind of a way to save on overhead and, and, and be able to have fun.

Guest 5: Yeah.

Host: Okay.

Guest 5: Yep. And also to give it. I mean, once you find someone who, like an operator who would take over, it's all like, if the business is a little bit bigger, it also makes it more interesting for that person. You can find a big, like, I think you can find a better person even to take over just because there's more to manage and more to. More to do.

Host: Sure. Philippe, you were new to the pets industry when you acquired Pets International, and you heard from people in the industry that, like, you know, this is an industry. Once you enter, you'll never leave. Have you found. How have you found the pets industry? And on that, how have you found the media industry because. Or the media business, I should say, because you were also kind of new to B2B media publishing. So take those two separately.

Guest 5: Yep. So on the pet side, it is a super fun industry. I think just being around pets or thinking about or like, and just being involved with pets all day, I think that just makes people happy and that really comes across in the way people interact with each other, even if they're competitors. In theory, it's. I mean, it doesn't really come off that way. Everyone is super friendly, super nice, kind of probably the friendliest and nicest industry I've ever been in. So from that front is definitely a. A very positive thing, whether I'm ever going to leave the industry. I'm not convinced about that, but I mean, let's see, maybe time will tell, I guess on the media and publishing side. Yep, definitely my first. It's been interesting. Has some. I guess there's no recurring revenue. There's no, like, there's none of that. You're almost creating your product from scratch every single day because you have to create new content. So those are maybe, I guess, some of the more challenging aspects, but in a way that also keeps it interesting, especially creating a new product like you can evolve and make things better over time. Yeah, I don't necessarily know if. I mean, aside from if I would just expand the publishing business, I don't know if I would do it again if I. It all depends on what business you come across, but I don't know necessarily if media businesses are the best businesses you can. You can get into. But it's definitely not a bad business at all to be into. Be in. So, yeah, I think overall it's been pretty interesting and pretty good.

[30:22] Host: Well, it sounds like there's been some things you've uncovered about the media business since you've acquired one that was a little bit different than you'd predicted. Can you elaborate on that? And just in general, if there are things about this entire experience of buying a business that are different than you predicted, can you share with us some of those things?

Guest 5: Yeah, for sure. I think, um, if I'm honest, when I came into the business, I did not have like a massive growth plan or a strategic, strategic plan of, okay, this is what I'm going to do. This where the business is going, because as soon I was not looking for this type of business to begin with, but once it came, once the opportunity come up, it just seemed like a very attractive opportunity. So I jumped on it and things moved pretty fast. So I didn't really have much time for big plans. But obviously even in that, like, I guess, limited time, you still form some ideas of what you think the business can do and where you think it can go. I think just the constant need to find more advertisers is always, I would not say a challenge, but it's always something that keeps you active, let's say. And I maybe underestimated that a little bit. And I think overall it's not necessarily to do with the publishing business or media business, but more just when I took over the business, I kind of had to start this team from scratch. I mean, we had like a core team of freelancers that have still been with us since that. Since the beginning or maybe since the past ten years or so. So that team has always been stable. But the people that I hired is basically the team I had to start from scratch. If I would do something again, I would probably. Or if I would start over, I'd probably start hiring sooner just to move a little bit faster, let's say.

Host: Okay, okay. But the hiring that you have done, this is all coming out of. I mean, the business can support that and still pay you the salary that you want and need.

Guest 5: Yeah, yeah. I think before I took over the business, they were, including the previous owner, four people working in the business. And just for whatever reasons, like when I started, I kind of started with a clean slate so I could really build my team from scratch. So now we're three people instead of four previously, which, yeah, gives. Gives definitely plenty of room to cover my salaries.

Host: So when you bought the business, there were four people working in it, and on day one, you were like, I'll just be by my. Just do all of it by myself.

[33:03] Guest 5: No. So the previous owner had kind of decided before the acquisition that the original team was kind of let go. I mean, they were just going to look for new challenges. So I came into the business where there were no full time employees anymore.

Host: Okay, okay. But only very recently had those folks left.

Guest 5: Yes.

Host: Okay. Okay. One of the things that you were looking for in a business to acquire, Philippe, was location independence. You are speaking to me from Lisbon. So you're not, you're not at home in the Netherlands. So has, has it checked that box, this business?

Guest 5: Yeah, definitely. I mean, even most of the team, like the core, like the. My full time employees and the freelancers, they're. Almost all of them are. The majority of them are in the Netherlands as well. But we're just remote. Like we don't have an office that we go to every day. So whether I'm in Amsterdam or I'm here in Lisbon, it kind of doesn't matter.

Host: Yeah. And have you taken advantage of that a lot or is this, this trip to Lisbon, your first kind of time doing this?

Guest 5: This is honestly the first time.

Guest 4: Oh, good.

Host: Well, good. Perfect timing then for, for this, for this conversation. So just to wrap up, Philippe, you know, in our, in our first interview, we talked a lot about your, your discovery of acquisition, entrepreneurship, finding Walker's book, Buy, then Build. How do you feel overall about acquisition, entrepreneurship as a path?

Guest 3: Yeah.

Guest 5: Now that you've done it, I think for the right person it can definitely be. I mean, for me it's, I think, the perfect fit. Like, I am not so great at starting things from scratch and I'm better at getting my hands on something that's actually running, that is already doing well and then just improving that and growing it further. So I think that's where I'm most happy. And it's difficult to get that into that position if you're not just buying the business. I mean, you can kind of grow your way into like a CEO role or whatever to get there, but that obviously takes much longer and it's a different trajectory. So for me, this has been kind of the perfect, perfect way to get here.

Guest 3: Great.

Host: And so you sounds like you would do it again. Maybe you would refine what you bought. You've learned things about the media business that, you know, maybe you might be a little bit more circumspect if you were to buy look at buying a media business again. But the idea of buying a business as your path to entrepreneurship, you would do that again?

Guest 5: Oh, yeah, definitely.

Host: Cool. All right, well, let's leave it there. Philippe, thank you very much for coming back on. I'm so pleased to hear that things seem to be, you know, going, going really well and going according to your plans. So continued continued good fortune with the business.

Guest 5: Yeah, thank you very much. It was nice catching up. Sure.

Host: Next up, number three, Cassie Niekamp. Cassie's episode was buying a $1.2 million fencing business in earning trust quickly. That's episode 17 from August 2021. Here she is, Cassie Niekamp. Welcome back to Acquiring Minds.

[36:10] Guest 6: Thank you, Will. Great to be here, Cassie.

Host: We recorded our episode in August 2021, so a bit over a year ago, two months prior, you had acquired Bowden Fence, a 38 year old fencing business in Columbus, Ohio. So I want to spend a few minutes with you hearing how things are going 14 months later. So can you, can you start us off, Cassie, with kind of a, kind of big picture, what life looks like at Bowden fence. Now in October 2022,

Guest 6: life is full at Bowden. And so we are almost 3xing our revenue, which is really great.

Guest 3: Yeah.

Guest 6: It has put stress on our systems and our processes, which has felt uncomfortable at times. We've added people and I think that we are at the point right now where people are really gelling in their role. We're really got our hands around. We launched a new software back in the spring, back in April. In some ways it feels like we've had this software for 10 years. In some ways it feels like we just launched it yesterday because there's still some bumps that we're trying to, you know, edges were trying to soften there. So the software allowed us to do more project management, sales CRM and project management in one. So life is feeling full. We're kind of, we're kind of busting at the things and seeing where in our processes we still have yet to iron out.

Host: Okay, great. Well, I want to dive into that. But before we do, give us a quick reminder on more about Bowden Fence, what you bought. So you know what the business is. You know a little bit more about like fencing, residential, is it residential, commercial. So on revenue, whatever you can share about revenue, the revenue, any kind of mix, is it, is it construction, is it maintenance? Age of the business? We already said it's 38 years old, but anything there and then size, number of employees and then, and then your deal terms, if you're, if you can even remember that far back at this point. So just a refresher.

Guest 6: Yeah, we had bought a 38 year old business, it was fencing and they did both residential and commercial. And what is really nice, kind of about that mix is you can ride a bit of the recession, the bull and bear markets, if you will. And so we like that 50, 50 diversification in terms of commercial versus residential. It's something we still are trending towards that same mix, which is great. So it was owned and founded by one man, Terry Bowden, and he was 72, he was ready to retire. And he has been nothing but the utmost of a gem in terms of supporting us. Doesn't mean that we haven't totally changed all of his processes or maybe the way he went about even estimating. There's almost no Terry Thumbprint left in the business. I'd say it's really, I think the first year I felt a lot like an imposter. Like this was somebody else's business that I was showing up to work for every day. And I could see more of him than I could see of myself. But it is so interesting to now go into our warehouse and see changes that we had implemented which are just so, it's so rewarding. So the way we went about the deal was we found it on Buy Sell Biz and we did a SBA loan mixed with a seller carryback. And that's the way we went about financing the deal.

[39:41] Guest 3: Great.

Guest 6: In terms of the revenue. So prior to us taking over, a peak year for them was about 750 to 800,000 in revenue. This year we'll hit 2 million. So we're on pace to Hit that. And I think we're going to exceed it, actually. Congratulations. So thank you. It's been a lot of hard work to get here. We've asked a lot of our team, we've asked part of that change management structure. I mean, we asked people to re evaluate their roles. We maybe hired them for one thing, but said, oh, wait, I got, you know, this moral has now morphed. And that's not easy. It's not easy to have that conversation. It's not easy to feel like, you know, I'm asking more or something different than what you thought here. How does that sit with you? But that's kind of where we are today.

Host: Well, so judging by that, really phenomenal revenue growth. So is it fair to say that things are going well? Like you, you're older and wiser and maybe have a few scars, but like, that sounds like things are going pretty great. Correct me if I'm wrong.

Guest 6: Things are going well.

Host: You're hesitating there.

Guest 6: There is nothing. And I don't want to paint a glossy coat over it because I feel like there are days where. Let me go back. I did not sleep the first six months of taking over this business. I would wake my husband up in the middle of the night concerned about something, whether it was a person, financial, a customer. Everything felt so fresh, so fresh, so new. And I wondered what mistake I was making next. Yeah, and I recently read, actually just yesterday, this really interesting article about making mistakes. And I think I didn't give myself enough permission to be messy to make mistakes in that first, you know, year, six months. But the reality is we put our. We put our life savings on the line here. Like, this is not, you know, just something that felt insignificant to me. This was something that was meaningful. I wanted to make my husband proud. He's my business owner for Pete's Safe, but he's also my life partner. I wanted to make my family proud. And to say that that was an insignificant investment that we made would be absolutely incorrect.

[42:02] Guest 3: Yep.

Guest 6: So it felt like the weight of my. The world was on my shoulders. For the first six months, I didn't know anything about fencing. I came in completely naive, which in some ways that was a. That was a blessing. And what has happened since that point is I have gotten experience, and there is no teacher like experience. And I think leaning into the uncomfortable of what experience can teach you is raw and it is hard, but you have to kind of enjoy that journey at the same time. Yeah, there's been a lot of growth. I think personally yeah, yeah.

Host: Speaking about being completely new to the fencing business. So do you feel like a year, 14 months later, have you, have you learned the fencing business?

Guest 5: Are you.

Host: Yeah. Do you feel like you've kind of that piece you've, you've mastered?

Guest 6: I'm a little dangerous at this point, I think it's safe to say, will I still contribute to the sales? Like, this is one of my big focuses for the fourth quarter is to really form more partnerships with contractors that we want to work with. And so it's something I haven't really been able to focus a lot of time with some of that, like, top line level growth. It has been a lot of block and tackling. You know, we talk a lot about working in the business versus working on the business. And I maybe had a slightly skewed vision of how long it would take me to really work on the business and get people fulfilled in their roles or really mature in their roles. I had a very big life, personal event that happened this year that helped that. And I can go into further detail about that if you'd like to.

Host: Sure, yeah. What's that?

Guest 6: Okay. I had a baby. Congratulations, June. Yes. So for those of you who maybe have missed our previous podcast, I think we talked about this. No, we did not.

Host: We didn't.

Guest 6: We did not.

Host: You may have known because. No, no, you wouldn't.

Guest 5: No, no.

Host: Because August to June. No, you would.

Guest 3: Or.

Host: I mean, it would have been right around that time. Would have. That you would have been.

Guest 6: That's right. Yeah. So picture this. I'm freelancing to running the business. The most stressed I've ever been in my entire life. My husband and I have been struggling with fertility for close to five years, and I find out I'm pregnant three months into running a business.

Guest 4: Wow.

Guest 6: I'm not sleeping. How in the world does this medically add up, you know, only by the. The grace of God. So in the first year in June, I knew that I had a very hard stop. I had brand new employees that were less than four months old. I had a leadership team that's, you know, very green, if you can call it that. I'm involved in every leadership decision, so it's not like I have others to pass out things, but I had a young team and I had something, a very hard deadline. It wasn't like, hey, you know, this deadline, we're not really going to hit it. We're going to push it back to September. Well, that's not the way babies work. So we essentially had a really beautiful push in our business to say this has to happen. You have to feel good around this software that we just launched two months ago. You have to feel good about this role. And how would Cassie make decisions? How are you going to make decisions without Cassie present? And I will tell you that my husband stepped in. He ran his day to day. He does construction and development and he would come into the office from 6 to about 9 or 10 every morning and then do his job 9am to 6pm past that.

[45:37] Guest 4: Wow.

Guest 6: So you want to talk about two tired puppies? It was, you know, and that was before.

Guest 5: And that was.

Host: Wait, so that was before the baby arrived or when you were on maternity leave?

Guest 6: I worked up right until, I mean, I was on meetings, having contractions.

Guest 5: Oh, wow.

Guest 6: The day before my. Yeah, I was like, hold on just a minute. And I turned my sound off and as we were going through next week's scheduling. So.

Host: Wow, what a war story. And, and what, what was your maternity leave going to be or what did it end up being?

Guest 6: We had kind of a two to three month hope. You know, a part of me just felt so selfish around this time because I had waited so long for our family to expand that I wanted to be really protective of this. But what actually happened is our plan, as plans go, you know, two to three months, it wasn't, it wasn't realistic for the seasonality we were in. We were in peak fencing season. Q2 and Q3 is peak selling and peak installing season here in the Midwest. And I saw how depleted my husband was becoming. Like he was depleted and he really tried to shield me from things. But there were also things he had to bring me in on and I could tell it was very taxing on him. So I ended up coming back, I think at the 7, 7 week mark, which is fine. Actually. The way we went about that is we remodeled the second half of our business, the second floor floor rather. And I, I had a bassinet up there. I have a rocker. Like it was. She came to work with me every day.

Guest 4: Wow.

Guest 6: And my team was super generous and luckily she's a great baby. So she barely made any noise. But they were just really generous and they really flexed with me during that time, you know, and they had questions like, what will this be like after returning leave? What will this be like X? And I said, guys, I don't know. I've never had a baby and ran a small business at the same time. This is called an fft or a freaking first time. I don't know. And they were more than generous, just very, very gracious.

Host: Well, obviously that whole experience kind of flavors your entire first year in the business. I mean, it was a lot of it. It wasn't just your typical transition. It was your transition plus pregnancy and then maternity leave.

[48:11] Guest 3: So

Host: one of the things, Cassie, that was, so that was a strong theme of our first interview was, was your kind of vulnerable, your vulnerability and how so? Like not coming in and not knowing anything about fencing. You didn't pretend to know anything. You just came in and you said, you know, I'm a student, I need for you to teach me. It sounds like your management style has continued to kind of be that way. You don't pretend to have everything perfectly planned out. You seems like you really engage your team and say, hey team, I'm going to, I'm going to need you to help me here. You know, we're going to see how this goes. I can't promise how it's going to go. Seems like that has continued to be your style and that it, that, that it really resonates with your, with your team.

Guest 6: I think so. I think it was really important. I felt a, I think I shared this maybe, but I had a leader who wanted to feel as though they knew and griefing before you even asked it. And I thought that it was just a missed opportunity to really connect with the team around. Hey, I don't know that answer, but I'm going to hunt it down for you so we are better equipped to tackle it and came at it from a partnership perspective versus I hold all the answers, I'm rarely wrong perspective. That was really important to me in a leader and I have served what I would feel would be the opposite way of how I'd like to be led.

Guest 5: Yeah.

Host: Cassie, you weren't yet paying yourself when we, when we spoke. Are you paying yourself now out of the proceeds of the business?

Guest 6: I'm paying myself. It is a modest. I think I might be the least paid person on our team, but I'm paying myself and it's great. You know, the reality is, is we want to be focused on the long game and the long term investment while having substantial cash flow. And the thing that has surprised me a lot in the construction world is as a growing business, how much cash flow is really impacted by that, what resources it takes to run a business. You know, things pop up all the time. We've had just about every truck in the shop this past month and those are unexpected, you know, expenses, however they come out of our bottom line. And when you Read a P and L coming into a business, you don't feel the emotion behind that, oh, we were down a truck, therefore we lost productivity, therefore, you know, we're at the whim of the mechanic. Those are the things that you don't read on the P. L as it feels or reads in real life. And cash is king. You know, you have to be really aware of your cash flow and AR collections in order to feel very healthy about the business as it moves forward and grows.

[51:01] Host: It's so funny that, because I hear people talk about it all the time, say this all the time, and it's people who probably had already heard it themselves. But speaking to your point about like experience versus kind of academic knowledge, it's like only really when you've been in a business and responsible for a P and L where cash flow cycles can be tricky and tight, do you really kind of, do you really internalize this? The, the, the, the complexity and the, and the delicacy that is cash flow, at least in a business that, where, where cash flows is tricky. So.

Guest 6: Correct.

Host: Yeah, Cassie, we're, we're bumping up on time, but I just want to get to. You know, you mentioned that you've made a lot of changes. You put a new software, you move people around, enrolls, you ask, and obviously that you've gone from $800,000 to 2 million on track to $2 million in revenue. So are those all, all those changes, are those what led to the bump in sales or more than a bump, I should say the surge in sales?

Guest 6: I think a couple things. I think that we had a marketing plan, so we got a new website, we invested in digital marketing, we focused on our Google reviews along with. We hired a second salesperson. So never before had we delineated between commercial and residential sales. That was big for our business. So it was an additional overhead investment bringing on a second salesperson. But, you know, it's. We're doing some 2023 planning this, this month, and it's so exciting to see how these two have really corresponded together in terms of numbers and goals and activity. And it's really working. So that's really fun. I think that's a big, big part of our, our growth has been the marketing as well as the second salesperson and getting the right salespeople on board. There was a. I used to hire for a living in terms of, of recruiting. So the first hire I made was a colossal mistake. Oh, and talk about experience. You know, I felt like I got road rash from that one. It Just was not a good fit. And so therefore getting the right salespeople on board. And I feel like we have an awesome team right now ready to charge. So keeping them engaged, keeping them really purposeful at work, keeping, you know, their hopes and goals on their one precious and short life alive here at Bowden, that's really important to me too.

Host: Speaking of purpose, Cassie, you, when you were telling me about your motivation to go out and buy a business, in our interview, you had said that it was kind of, you were experiencing a crisis of purpose in your professional life. Kind of like what, what is the best use of my talents? Presumably you didn't feel like you were, you were, you were using your talents to. At their utmost and you landed on buying a business as kind of as fixing that problem. Has it been the, has it solved the crisis of purpose? Has it given you a sense of purpose that you were, that you kind of felt you were missing before you got into this endeavor?

[54:18] Guest 6: I think that my purpose is I would define it as using the highest and best purpose of my talents. And if I am not learning and growing and being stretched as an individual, I feel like that is a not good use of my time. I want to be stretched. I want to grow. And I think during that time when I had that aha moment before buying the business, it was like a mirror was being held up to me saying, are you growing? Are you learning? Are you stretching or are you playing it safe? I can fully share with you that there is not a week that goes by that I am not surprised at something of the business or that something does not go smoothly here. So in terms of growing and learning and sharing, you know, it's. What I found is absolutely I'm on the path to my purpose. Does it feel like that every day? No, it feels like oftentimes I'm a fencing contractor and I'm going to work in a. On a job site. But there's this moment between kind of stepping out to the big picture and realizing what our long term goal is versus the day to day. They're two worlds apart. What has helped tremendously is kind of forming these small groups of people who are in your corner when you can't relate with your team. So I have business owners across the country that I see speak with regularly about. You will not believe what happened today.

Guest 5: Yeah, yeah.

Guest 6: And it's, it's really this feeling of that vulnerability back to the vulnerability you're sharing. Like we're over trying to sound cool or act cool or, you know, I've made this great investment. It's. You will not believe what happened today. Can you relate? And there is an absolute like echoing back or, you know, motivation or a blog or a tweet that somebody sends to say, keep your head up. You know, we, we've been there too. Or here's how I tackled it. And that is what is really surprised me the most about kind of this really cool community of owners. And it doesn't matter if you're running a website business, an e commerce business, it doesn't matter if you're running an accounting business. There's relatability in a lot of small business aspects.

Host: Yeah. Speaking of being a fencing contractor, Cassie, you, you, you know, when you and your husband were considering making this move, you thought, you know, in the medium or long term, the idea would be after you've grown the business and put in your systems and so on, that you would be able to step out and put in an operator under you and it would become something more where you're the owner, but you're not in the business. You're not even maybe on the business. You're kind of more, more passive. How close to that reality are you? Do you see like the. You could put in somebody to replace Cassie in the near term or is that still kind of a distant dream?

[57:22] Guest 6: You know, my, my timeline on that was a five year goal.

Host: Yeah.

Guest 6: And I still feel very good about it. Okay. I still feel very good about it. I think that maternity leave was something that expedited that in a more positive fashion than I ever could have imagined. So, for instance, I think the business is a headed year because of my maternity leave. I think that we were forced to make decisions, right or wrong, that needed to happen in terms of speed in order to get up to this point. So at the time when I'm thinking, what timing, now I'm thinking, well, that worked out for the better. You know, by the way, a baby is always a blessing no matter when they come, so. But I think we're a year ahead in our business from where we could have been.

Host: Yeah. Yeah. Well, yeah. What, what a great. I mean, not that you played it this way, but what, what a stress test for the business, Maternity leave.

Guest 6: A stress test indeed. Yeah.

Host: Last question for you, Cassie. If you were talking to somebody who was kind of, who was saying to you, hey, I think I might want to go out and buy a small business, become an acquisition entrepreneur, what, what would you say to them now about pursuing this path now that you've been on it for you know, year and a half overall.

Guest 6: This is not the answer I would have given when I Talked with you 14 months ago, but I think it's finding that community. So the community I spoke with was small business owners across the nation. Some of them are fencing and some of them are non related. So what my advice would be is to find online groups such as like Facebook groups or associations, pick out some of the top performers in those groups and make them your tribe. And one of the things that we did was we had a fencing conference through the American Fence association in February. Went to the conference, obviously a newbie created like my own fence Mastermind, which we meet monthly and there's 11 people that are like members of this little group. It's completely like attend if you can, attend if you can't, it's a zoom, if you can't, it's a zoom call. Yep. And we share like hey, we go around and we share what are your wins this week? What is not feeling like is going well. And you know, we have owners that are operating a ten million dollar business from scratch. We have owners that are operating a million dollar businesses that they're ramping up and just a year old. And what is so amazing is you can glean from all sorts of owners. We have owners in California, owners in Pennsylvania, Vancouver, Washington. And the things that they constantly are reassuring to me or sharing best practices. They'll share financials, they share documents, they share customer sign off sheets, terms of service. Those things have been so, so valuable. And I think around the vulnerability around being new in an industry I did not know is I said hey, I would love to share best practices. Are you open? I need some help. And people jumped on it in the most amazing way possible. There are such givers.

[1:00:41] Host: What a great tip and what a great, you know what great initiative on your part to put together that group. I'm sure it sounds just invaluable.

Guest 6: Super invaluable. And there was this tweet from a business owner who took over a business in Colorado in like his first week. He said, I've never felt more lonely. And you will feel a version of that at least once a week, if not once a day. I have never felt more lonely. And it's because you second guess yourself. It's because there's hard questions that need answered. It's because there are people involved with different intrinsic motivations and you don't want to feel lonely because that's not very fun. So if you could come at it from a, you know, a community perspective that's reassuring, gives you better ideas, expands your mindset as to what's possible, and it's frankly the way I prefer to do life.

Host: Let's leave it there. Cassie, what a. What a great insight and piece of advice for people out there who might find themselves in the seat like you are in the months and years ahead. Thank you very much for coming back on Cassie. What a great update and congratulations on the success. You seem to not want to say full blown, it's been, you know, we're crushing it, even though your numbers sure look that way. But that's probably, you know, your wisdom talking, like not getting carried away with your, with positivity and recognizing that every day there's a potential punch in the face to be had.

Guest 6: Yeah, let's talk again in a year and see how we're doing then.

Guest 5: Exactly.

Host: Thanks so much, Cassie. Congratulations.

Guest 6: Thank you, Will.

Host: The next interview is with someone doing something a bit different. Andrew Pierno is building a micro private equity fund. His was episode 25 in September 2021, how to build a portfolio of micro SaaS businesses. Here's Andrew. Andrew Pierno, welcome back to Acquiring Minds.

Guest 4: Thanks, Will. It's great to be here for the second time.

Host: Andrew, we recorded your first episode in September 2021. So just over a year ago and you were acquiring a portfolio of micro SaaS businesses under the banner XO Capital. You've done four acquisitions to date. And for many indie hackers and online entrepreneurs, a portfolio of micro SaaS businesses. Sounds like the dream. Sounds like the dream. So I was really eager to learn all about xo and today I am super eager to hear how things are going now, a year later in October 2022. But before we get into that, Andrew, why don't you just give everybody a quick refresher on exo capital, kind of what the vision is, why micro SaaS, your thesis, etc.

[1:03:25] Guest 4: Sure. So exo Capital is you could think of it as a micro private equity company. We buy small software companies. There are a number of reasons why you might buy a software company. We buy them for cash flow, though. So the idea is that we're acquiring cash flow. People do this with offline businesses or if somebody wants to buy a laundromat or storage unit, et cetera. We're just doing it with software. That just happens to be my background and what I know best. There's a ton of people doing it successfully in E commerce, et cetera, but we've just stuck to SaaS. So yeah, we buy wholesale companies, we buy 100% of them and we take over operations. Sometimes those businesses come with people at the scale that we're doing things at. Oftentimes they don't. And so although it may sound like the dream, it is, it's. There are particular kinds of headaches that come with operating a portfolio, namely context switching. Almost always you have to have shared resources. So we're now up to five full time people, excluding myself, and we've bought six total. We've sold two now and we're currently operating four. So we've continued to buy slightly larger businesses. But the thesis remains the same, which is sort of a non thesis, an opportunistic thesis, I should say, around just acquiring pure SaaS businesses or as close to pure SaaS as we can get. Because the second you just, you say SaaS or pure SaaS, once you actually get in, there's all different kinds of SaaS. Right. Not everything is because it has software is Automatically, you know, 90% gross margins and you know, totally automated and all of these things that people typically associate with software businesses.

Host: Sure. Well, despite the thesis lessness or the opportunistic. Opportunistic nature of the thesis, it did feel like you had a strategic target on micro SaaS. So quite small companies with quite small MRR. Was that an explicit thesis or what? Why were you playing there and are

Guest 4: you still so at the beginning, the. I wouldn't calling it a thesis is a little bit more grandiose than it was. Right. We were just buying stuff with our own cash. We only had so much of it and so hey, micro SaaS, it's like SaaS but smaller. Great. That's what our budget is. Awesome.

Host: Exactly.

Guest 4: Um, so. But at the same time I still feel like despite us having moved upstream to start buying businesses that like our most recent one was like mid six figures. So these aren't, these aren't like tiny little things anymore, but they're in the grand scheme of things, not very big acquisitions. I still feel like there's a huge opportunity to be the de Facto acquirer of SaaS companies doing sub 10k MRR. I just think that there's still, that opportunity still exists. We have been focused on the past year of trying to buy slightly larger things. There's a whole bunch of headaches that go away when you start to have a little bit more cash flow to play with. Namely you can hire people, which is a beautiful, beautiful thing. And that's really difficult to do until you hit a critical mass with a little portfolio. The kind of downside of doing that is that when you tend to buy larger businesses oftentimes, and I would call this a mistake that we've made too is that the surface area of the products is sort of dictates what kind of resources you're going to have to put into the business. So concretely, let's take two examples. One is a B2B SaaS company that sells more towards enterprise customers. So enterprise customers, albeit oftentimes are quite lovely. Right. They'll write a $25,000 check and not even blink and they're never late and they never ask any questions. However, the demands on the product from their perspective are an order of magnitude more than let's say some of our smaller companies like sheetbest or Screenshot API that have, I like to call it one promise to the customer. They kind of do one small thing. So when I say we don't have a thesis, what I actually mean is that I don't know that we have the ability to execute fully on the thesis that we would like. But if I could kind of congeal it into you know, a few sentences we look for now product led growth type companies, I. E. A company where you can the, the, the, the, the path towards getting a customer to sign up to the product. They sign up for a free trial. Right. There's some conversion rate there. We try and optimize that out of the free trials, some amount convert. Um, right. That, that's kind of a product led growth type motion as opposed to an enterprise type sale where I need to go and build relationships for six to nine months. That's how long these deals take. There's a smaller number of them but they're often higher touch. So I have to staff a particular kind of person, typically a salesperson or a bdr, an sdr, somebody like that. It just those two businesses put strain on our shared services model. And so at the moment we're leaning more towards these kind of product led growth companies where there's like a freemium and a free trial and a conversion because then we can start to really operationalize top of funnel activities like content, how do we bring people to the site, et cetera. What are our conversion rates? Okay, well how do we increase those conversion rates? What kind of drip emails can we send after they sign up to get them to take particular actions in the app so that they become activated. Right. Um, Slack has I, I think they're, they're like golden metric for when they know a customer is going to stay long term is having sent like A thousand messages in Slack. Um, same with Facebook. Had this early on. If you got 10 friends, you were way more likely to be a kind of a lifetime Facebook user. Um, and so these product led growth type companies, we can, you, we can kind of operationalize content right. Then we can operationalize the funnel in between, but we don't have to do kind of hand to hand combat like we do for an enterprise company. So we currently have one of those enterprise companies and it's just been enlightening to see how much of a tax that is operationally. However, we closed one customer and it paid for the entire acquisition. One customer paid for the entire acquisition. That's never going to happen with a $10 or $20 or even $30 a month kind of freemium type software company. Like, it just, it just won't.

[1:09:56] Host: Yeah. You know, one of the things that I think about when I hear this product led versus kind of enterprise sales, one of the other. Maybe you're kind of saying this, but one of the other things that people talk about is enterprise sales basically requires more butts and seats. You know, it requires a sales team, more humans in your operation. As you said, much more relationship building. It's really your sales, your sales function becomes the revenue driver versus the product led. Growth is, is much more of, kind of the kind of that again, dream in quotes SaaS business where there's very little, you know, human interaction and you know, the thing is just a black box that spits off money drip. But you know, I want to tie this actually in to something you said at the end of your September update. You're by the way, I want to encourage the audience to check out your blog. You're a prolific blogger putting great, great content about, you know, the inner workings of xo, your most recent blog update in September. You talk at the end about replacement remote work and how your remote work is kind of getting to you. I mean, we all recognize what the pros of it are, but the cons of it are you seem to be missing a little bit of that human interaction and you like the idea of going into an office. And you know, it strikes me that an enterprise sales team, there's a lot of camaraderie in a sales team. So that cultural aspect might actually be more of a fit for where your head is at with an enterprise sales SaaS versus the micro SaaS businesses. I might be reaching here, but do you want to react?

Guest 4: I don't know if it matters so much what is happening inside of that. Let's call It a shared space. The office has kind of all these negative terms. I think what was missing or what is missing is just the team building and just kind of the sharing wins and sharing losses. It's not so much like a. Of course camaraderie is a part of it. And I know what you're saying with the sales team where it's like a tight knit group and they're often have like their own kind of subculture within a company. I'm still thinking logistically how I could do this without raising capital. And I'm not sure how I would do those enterprise deals without raising capital. Right. They're just a lot more capital intensive. I'm going to have to sit on the salaries of several salespeople before their initial deal closes and they pay for themselves. And that's just tough to do with a bootstrap business. But I should clarify. I want it to be my office that I go into. I don't want to go into somebody else's office. I want it to be like this optional thing where it's like

[1:12:34] Guest 3: a real

Guest 4: place where you can just escape the box that we've all been living in for the past two years. I'm in California, so I've been in. In a box for a long time. Meaning we've, we've been, you know, Covid. Restricted for, for a long time. But yeah, I mean I just, I just wanted to acknowledge that for me after reflecting on the past two years just being in an office kind of by myself that like it kind of sucks and there's parts of being in an office that I just absolutely miss.

Host: Yeah, yeah, I second that. Andrew. The let's circle back to you guys going up market a little bit is that I think you're also working on an SBA finance deal. Correct?

Guest 4: Correct.

Host: Okay, so you hadn't done one of those when we spoke last. And for my audience, this is really going to resonate because many of my audience are not SaaS acquirers. They're buying, they're buying services businesses, you know, physical businesses. And the SBA is, is used by them almost across, you know, almost without exception. But you can't, you typically can't do that in a SaaS deal because SaaS multiples are so high for a couple of main reasons for SaaS businesses are too expensive for the SBA to pencil out. SBA loan to pencil out A and B. Often the SaaS businesses are so young. SBA doesn't like to see, you know, hyper growth. In the last two or three Years. They actually too much growth and too little time can be something that the SBA frowns upon. And that can often be the nature of SaaS businesses. Much more E commerce businesses, but also in SaaS businesses. So anyway, how is it that you found a SaaS business to acquire with an SBA loan? I know the deal hasn't occurred yet, but like shed some light on this particular deal.

Guest 4: Yeah, and I don't know that it will. And I'm going to have to talk in abstracts because again, it hasn't closed and you know, I don't want to, I don't want to overshare without running it by the seller. But so yes, we found a deal. It came in through my network. It's an off market deal. I don't know that it will actually go on market if it doesn't work out with us in the sba, it is in the low seven figures. So it's, it's far too much cash that we don't have that on hand. So the first problem we encountered was they were the financials weren't straightforward. The business had sort of a consulting piece and it had the SaaS piece. And the first lender we approached told us last week they can't do the deal. And the reason is, is they can't pull out the consulting fees from the SaaS fees. And from my perspective, and again, this is, this is not a knock and this will probably come as no surprise to people that have kind of looked at this a little closer than I guess we have. But that's called subtraction. Right. If you take this revenue that doesn't belong to this thing you're trying to buy, you just subtract it out, you get compiled financials, that's the term, and those are the real financials that you're trying to buy with the business. And the slender was unable to kind of see past this additional revenue coming through this entity. And we weren't buying the entity. Right. This was an asset purchase. And so they just said, no, this is too complicated for us. And that really struck me as kind of baffling. It's like, is there no. I mean, not only did we have to have all the stars aligned to have this deal kind of come into our little world and kind of like choose us right to carry this forward through the sba. But, but the financials also have to be like this, this perfect pristine thing, which of course, like nobody's financials are, I mean, come on, these are like small businesses. And so I, I, I was Kind of like bewildered at the fact that they were unable to accommodate some subtraction really into their process for figuring out how to finance this deal, which was fully financeable. Like it, it looks great when you just look at the SaaS revenue. It's an awesome business. We're buying it for a good price, like debt service coverage ratio, all good. And they just couldn't see past it. So we went to another lender. And again, this might come as no surprise, but it was shocking to me because I've spent I don't know how many hours looking at this SBA stuff now, but the, there's not only a personal guarantee, but any loan above 350k, they are putting a lien on your house preemptively. So it's like, who's actually taking the risk here? The government is backing the bank. Right. And the bank is requiring a lien to fully collateralize the loan before you even get the damn thing, which I think is just extremely aggressive. To put a preemptive lien on a house, to fully collateralize the, the deal before they, before they give it to you. And so for us, that was, I mean, we're still chewing on that. Like, that was a major blow to our conception of, of how we might use the SBA to, to grow. And that just feels like kind of untenable to, to get a lien on the house, to just get a loan just feels crazy.

[1:17:36] Host: Yeah. And the preemptive lien on the house, is that separate from the personal guarantee or is that kind of under the umbrella of the personal guarantee?

Guest 4: Well, it's under the umbrella, but I mean, it's a straight up lien. Like they, you know, I don't even know how you would sell your house. Like you call your SBA lender and ask them to take the lien off to go so you could sell the house. Like, what a pain in the ass.

Host: Yeah.

Guest 4: It just feels like I had thought that the SBA was. And maybe it's, maybe it's actually not the sba, maybe it's the, the lenders, the banks kind of underwriting these things. I just thought that there was a desire and an appetite to figure this stuff out industry wide for software because that would open up like a whole new can of worms for them. Right. In a good way. Right. It would just increase the tam of stuff they could lend against for the sba. And I just haven't felt, I haven't felt that desire to try and figure out how to make stuff work. It's like the slightest speed bump and they're like, oh, no, we can't. You want us to do subtraction? We. Oh, we can't do subtraction. That's crazy.

[1:18:33] Guest 3: Yeah.

Host: Yeah. Well, that's, that's discouraging because I agree with you. I would love to see SBA deals happen more commonly in the SaaS and online business in general. Let's. To close out here, Andrew, let's hear just some more specifics on XO Capital. So you had said you've done six acquisitions and two sales, right? So your, your holdings were. There were four businesses when we spoke. Then you've sold two and added two, so you're still at four. Why did you sell the two that you did? First question, and then second question. If you can share some growth and revenue numbers on the overall portfolio.

Guest 2: Sure.

Guest 4: So the first, I think last episode, we spoke pretty in depth about why we sold that initial business. The highlight of that was we had a different set of partners initially that didn't end up working out. And one of those partners had brought that deal in. And it's. We couldn't figure out how to operationalize it. We couldn't get the right developers to fix the particular problems that this application had that this particular person said would be, you know, easy to fix or that they had covered. And so we ended up selling it to a group that's since taken it, and it's still, it's still living and breathing today, and it's even better. And those guys have done a great job with it after, after we sold it to them. The second business, this one, I'll admit, was a straight up mistake. I bought it not so much in haste necessarily, but I was in love with the business idea and sort of let go of our fundamentals. Right? Like, okay, we're buying cash flow, we're buying customers, maybe we're buying a little ip, but mostly we're buying a foothold into a new market that we really like and had an awful transition. So awful, in fact, that all of the customers, all 100% of them were paused before they gave us the, the application gave us access to everything and we could, we recovered zero of them. Zero. And.

Host: Wow, so you, so you bought a business with zero customers? Effectively.

Guest 4: Yeah, effectively. Effectively. The reason they paused it is because they couldn't afford the, the, the server costs during, while we were transitioning. And I just was. God, I just, I was, I was really upset mostly because they should have just pinged me. It was going to be like a grand we would have, you know, it wasn't, it wasn't a lot of money to us. Like we would have happily just said yeah sure, like don't worry about it. But anyways, it was from some kids in college and I think they had a falling out during this process too. And we were just the kind of. Yeah, exactly. So we ended up selling that it was fine. That is also at a group now that is taking it and bringing breathing life back into it. And they kind of are a venture backed company and are giving it a life of its own now too. So both instances have been really great examples of like we were not the right fit for it. But it had almost nothing to do with the underlying asset. It was just our ability to go and execute on those two businesses in particular wasn't very good. And so we just try to recognize that as quickly as possible and, and, and sold them. But yeah, so now fun stuff. We're currently operating four. We have one kind of enterprise Y type company and three product led growth companies. We're doing 25,000amonth at pretty high margins. We're still running profitably even with five full time people. We have two full time software engineers. Danny, one of the partners at xo, he's full time and takes a salary from the business. Myself and the other partner do not. We're kind of like I don't consider myself full time on XO yet. I still have the marketing agency that's still kind of going and standalone and doing great as well. We are at 9x for our first acquisition. The first thing we ever bought has grown 9x since we bought it. I was hoping I could come on today and say 10 but I can't.

[1:22:32] Guest 3: It's not.

Host: Well, still an impressive number. Congratulations.

Guest 4: Thanks.

Host: Yeah, great. So, so 9x on, on your highest growth acquisition and the others do you consider continue to see growth? Do they kind of grow, grow on their own or are you. Do you put marketing and content marketing into place for all of them when you acquire them?

Guest 4: Yeah. So we now have a process. We've been working with a group that every single company gets one blog post a week that gets pushed out to different social media channels. We're starting to lock in on what we think product led growth motions look like from top of funnel all the way to pushing people towards signups, all the way towards managing Churn. So kind of full end to end life cycle. We're getting a much better sense of operationally what that looks like and that is becoming what I see kind of for the first time copy and pasteable towards the next acquisition. So every incremental acquisition, I don't have to go and figure out content again. I don't have to go and figure out all of these workflows and how to push people and increase conversion, et cetera, because we already have infrastructure for that now. And that's what makes me really excited about the idea of even just buying some more of these smaller type companies is we're starting to just get some real leverage out of having the shared service model, which frankly, at the beginning sucks because it's so much context switching. Nobody gets to focus full time on one thing and just do it.

Guest 5: Well.

Guest 4: Right. Everybody's kind of bouncing between projects, but now it's just starting to feel like I see the light at the end of the tunnel. Like, okay, after two years of doing this, I think, I think we can say, like, we almost know what we're doing. I could put this on a deck and speak to it and say like, yeah, with some confidence. I think we could repeat this over and over again.

[1:24:17] Host: Well, and then that becomes kind of your, your secret sauce, your, your playbook, kind of Vista style, you know, kind of recipe for success. So you can, you can scale, really at that point and be. And be competitive. Competitively differentiated from other people trying to do what you're doing.

Guest 4: Yeah, this is, this is very secretive about, you know, their special little secret black cookbook, like, you know, Black magic cookbook. But I, I'm gonna blog about all this stuff and just say, like, listen, here's what we're doing. You could absolutely go do this today. I'm gonna tell you two things. One, it's gonna take a shit ton of time, and two, it's probably gonna suck. There's no magic. There's no magic. There's no such thing. I just don't believe in it. It's just hard work.

Host: Well, you. That was kind of your vibe last time. It feels like your vibe is the same today, that this is, this is certainly not easy, despite kind of how alluring the vision of a portfolio of micro SaaS and SaaS businesses is. But you do seem like you're very much committed to this path. Like you feel like it's working. You know, it's a slugfest, but it's working. And you know, you'll be at it. Like, you continue on what, you're marching along with this, with this, with this venture and with this thesis or opportunity.

Guest 4: Secretly, I have ambitions to take Exopublic one day.

Host: Okay, secretly.

Guest 4: So we're going to try and, yeah, secretly announcing it on a podcast. We're going to try and bootstrap to at least a million in ARR before we raise any capital and then we'll kind of look at what it looks like from there. But there's absolutely no reason why this can't 10x20x50x in the next couple of years.

Guest 3: Great.

Host: Well, let's call it on that optimistic note. Andrew, thank you very much for coming back and we look Forward to the 2023 update.

Guest 4: Thanks will appreciate it.

Host: Finally, we have Mike Bodkin. Mike actually appeared twice before on Acquiring Minds, having done a second acquisition only months after his first. The episodes were, respectively, number seven in July 2021, how to buy a landscaping biz and boost profits quick. And number 35 from October, how to buy landscaping businesses. Here's Mike. Mike Botkin, welcome back to Acquiring Minds.

Guest 3: Yeah, absolutely, man. I'm super stoked to be here. And congrats to you on your hundredth episode. That's awesome.

Host: No, thank you. Thank you. You were three of those hundred episodes. So you are the record holder three time Acquiring Minds guest. There you go, Mike.

Guest 3: I got to get a plaque or something.

Guest 6: There you go.

Host: Well, Mike, the first time I had you on was episode seven way back in July of last year, July 2021, and we talked about your foray into acquisition entrepreneurship. You had acquired a landscaping business in Florida, smallish landscaping business. We talked a little bit about the buy, buy small philosophy, which you embraced because it was a small acquisition. Your feeling was that it got you, it would get you in the game, which it did because you came back on in October 2021 a year ago to talk about your second and much larger acquisition of another landscaping business, which made you the second largest residential landscaping business in Central Florida. As of, you know, after two acquisitions as of a year ago. I know that you've been busy. I know that there have been more acquisitions since with more in the offing. So tell Catch us up, Mike. Since. Over the last 12 months, since October 2021.

[1:27:42] Guest 3: Yeah, absolutely. So we actually have acquired two more landscaping businesses and we actually shifted our focus to completely commercial services and landscaping. So while we love the title of being one of the largest residential landscapers in the Central Florida area, it wasn't conducive for us for scaling. And so we made a decision to pivot off to that. And there's a lot of headache and team involvement and strategizing and I think, you know, rightfully so we did it and it turned out to be a huge success for us, and it led us into acquiring two more companies. And we learned a lot in the first two acquisitions. That made us act super quick in the next two acquisitions. And so it's been great. And it's. We're moving at a much faster pace now. As you just mentioned, we do have more in the pipeline. And, you know, our goal and our hope is to continue to acquire good, solid commercial landscaping businesses with great people involved and become a real player.

Host: Mike, you said it was hard, but I still feel like you, you kind of are understating it. It seems like a huge pivot to take a business that is residential and shift to commercial. Maybe not from, from your cruise perspective. I don't mean to oversimplify, but I imagine it's not too, too different the work. But what do you. How do you say goodbye to? How do you do it so quickly? Turn off all those customers, those residential customers, while turning on enough commercial customers to, you know, obviously bridge that gap?

Guest 3: Yeah, I mean, we actually let go of about $1 million a year of business voluntarily. And I don't think I've ever said that publicly or posted that anywhere. But, you know, it was a big risk for us. Right. And I had to, you know, say some nightly prayers sometimes just to make sure it's the right decision and to make sure we were doing it. But it is a completely different model and a completely different. From an operations standpoint, your customer's different. How they pay is different. How you acquire customers is different. You're, you know, going to the nitty gritty of landscaping. Your equipment is different. The size of mowers you have and the quantity of mowers you have, the attention to detail you have to have in the follow up, the being able, from a crew perspective, to pace yourself better because you have properties much longer than you are in a residential place. And, you know, think about residential. This is a quick, like, illustration. If you're doing someone's house and you leave and go to another house and you're doing that every 20 minutes, you're jumping in the truck for five, 10 minutes, getting a quick break, getting some water and all that. When you're at a commercial property, say a school or a big hoa or, you know, a hospital, you know, you're trimming bushes for, you know, an hour and a half to two hours. There's no break there. So we had to recondition employees, we had to retrain employees. Unfortunately, we had to let some employees go that just, you Know, were committed to changing. And also our management team had to kind of get with the strategy as well, because it's different managing, you know, one client that pays, you know, 50 grand a month versus, you know, 500 clients that pay $100 a month. It's completely different.

[1:30:59] Host: Yeah. Yeah. Well, then, obviously I was wrong about the nitty gritty of landscaping itself. Sounds like. It sounds like the whole thing is different from top to bottom. And the. So should we assume that the reason you made this giant strategic decision is because of kind of the obvious, that, you know, B2B is preferable to B2C. You know, serving companies is preferable to serving consumers. Consumers is all. Is recurring. But maybe, you know, there's more churn there, and once you land those commercial customers, as long as you do a good job, the churn is less, you know, kind of all of that. All of that.

Guest 3: Well, I think it's important to say why we bought a residential landscaping business and then immediately essentially turn the faucet off. We bought it partly with the intent. You know, you could say it's a dumb acquisition. But in. In acquiring businesses, something that no one ever talks about is the talent that you acquire. The management team, you acquire the intellectual knowledge of the industry that you acquire. And it's one of, like, I think a secret sauce of ours that, like, no one ever talks about. That's like us in other industries or doing this as well is sometimes we buy a company that is like, okay, it's a good company, but we're really buying the people. And for us, this.

Guest 5: The.

Guest 3: Our second acquisition that was a big residential one, had a unique base of customers as residential, it's literally all in one neighborhood, a neighborhood that we wanted to be in. But the talent that came with it was unreal. And, you know, we should have three times what we did to get that talent as well as we still to this day have a focus of going into adjacent industries that are residential focus. And we thought if you become a trusted vendor of these homeowners, you have a foot in the door already. So if we acquire or start an adjacent business, whether it's. I mean, you can imagine what it could be with residential clients. You know, we thought that's a great end for us. And the talent is so important because every owner talks about, oh, my gosh, we can't hire people. It's a struggle. You know, we can't find good help or management guys always leave for, you know, whatever reason. Well, we're buying a business, and yes, we're buying the revenue and the history and all that stuff. But we're buying people that otherwise wouldn't leave these businesses that are now in our team and they're ours to lose, essentially, which goes into treating them right and all that kind of stuff. But that's kind of the reason why we bought that business and it's the reason to shift to commercial. Was so in landscaping in general, I looked at the top 100 list. There's a magazine that comes out and publishes the top 100. And the information is probably not so super accurate, but it's close enough. And everyone on the top 100 is a commercial landscaper. Right. And like, I may be a fool, but I'm not that foolish. So if they're doing it, there must be a reason. Right? And I had many conversations and you were super kind enough to introduce me to a few people in the space and helped me tremendously, which I appreciate, you know, so much for that introduction. And it kind of steered us into, we're doing all this work, we want to be like this, well, let's do what those guys do and see where we land. And in doing that, that opened up the door for M and A for us and acquiring more and more talent mainly, but also, you know, good businesses. And we've purchased up each time, which is, you know, a good thing as well.

[1:34:23] Host: And what do you mean by purchase up? Larger and larger.

Guest 3: Correct. Each. Each acquisition we've done is larger, and we have another few that could be announced soon that are larger than the previous one we've done. And a hidden thing as well in this or something that we found. So we, we are very focused on a certain geography to a degree, even though we are expanding that as we get bigger. The network effect that happens in a flywheel of sorts. The more good, talented people that we obtain when we acquire these businesses opens the door for more acquisitions because they know a guy or someone knows that now they were acquired and they're good people and they ask them, hey, how's that Mike guy? Or how's Benchmark? Oh, it's great. Everything you said, you know, what's going to happen, happen. They treat us great, man, we have good benefits, all that stuff. And, you know, that's opened the door to us. So each of those acquisitions have been off market and the ones coming up are off market. And I don't know when you're releasing this, but maybe we'll have it close by the time this gets released, but everything's been off market. It's just Been a flywheel of network effect.

Host: And so you're saying a lot of these new deals that you're sourcing are actually via employees that you've acquired through that you now work for you via these previous acquisitions?

Guest 3: Yeah, I mean, they've came in a way through that. Not super direct, but, you know, if. If I bought you, you know, your podcast and Michael Gurley knows you and thinks highly of you and had a conversation with you of, hey, you sold the Mike, what's going on? You again. Mike was great. He was honest, he was fair, he's taking care of my guys. Then Michael Gurdley reaches out to me and says, hey, you know, I'm interested in selling too. What. What do you think? And they've come through attorneys of sort and other industry people, but yeah, I mean, it's been vicariously through people that we've acquired.

[1:36:24] Host: And it's basically like the larger your footprint gets, the more people, you know, the more people you come into contact with and the more potential connections and future, you know, opportunities that that land in your lap. It's great.

Guest 3: Exactly right. That's the flywheel.

Host: Yeah. Yeah. And so, Mike, for people out there who haven't acquired anything and have considered landscaping, the. Would you basically tell them, hey, skip the residential landscaping businesses and go. Go commercial directly?

Guest 3: Yeah, 100%. I mean, not even close. And we. I made probably not decisions, I repeat early on. But that's also going back to your point earlier about why I bought smaller the first time, so I can go through those growing pains. Although I know a guy, you know, there's a lot of residential that are very big and very profitable for me. It's just I'm not industry veteran, so I'm not taking the easiest path, but I can deal with B2B a lot better than, you know, a traditional just homeowner. And yeah, I would definitely, you know, advocate for someone getting into commercial landscaping, for sure.

Host: And are the commercial landscaping businesses for sale more competitive or higher or more expensive? Higher multiples. Because they are more desirable for all the reasons we're talking about than their residential counterparts?

Guest 3: Yes, is your answer, but because we've been off market with every deal, like, I haven't, I don't really speak to brokers, and that's kind of contradicting to, like, our thesis of acquiring more and more businesses. You would think I would talk to brokers all day. I don't, you know, I. There's a whole separate conversation about what

Guest 2: I think of brokers.

Guest 3: But yes, to answer your question, Commercial businesses are valued much higher than residential businesses.

Host: Okay, Mike, three quick hit questions, because I don't want to let this go too long, although it certainly could. You mentioned that if you were to do it over again, you would or you would advise people out there to just skip residential and go commercial. Is there anything else not related to landscaping or not that you would advise? A Would be acquisition entrepreneur, a searcher, somebody who's looking right now but hasn't actually acquired a business that you know with with the benefit of your experience. Now you. You look back and could. Would say that you did wrong or could have done better.

Guest 3: I think buying smaller was very advantageous for me. I don't think that's right for a lot of people. So I go back and forth. I actually had this conversation with someone yesterday that you know very well about the size of your initial acquisition, and I think surround yourself with good, smart people, listen to people that have done it before, and listen to advice from other people. I kind of just had a thesis and put my head down and went and kind of grinded it through, and I think I got lucky, honestly.

[1:39:10] Host: Okay, so. And put another way by, you'd still wouldn't say that buying small was the wrong thing to do in your case, but you do appreciate how kind of risky it can be, and you see all the weak points of doing so.

Guest 3: A lot of things could have happened to turn it the other way, and it would have been a disaster. And we just got lucky enough that a couple of those things fell our way and we had the right support system to see us through that.

Host: Yeah, great. And, Mike, what are. What is the aggregate revenue of benchmark today after these four acquisitions? Why don't you tell us what it is after the four acquisitions that you have made that are public, and if these ones that are coming up close, what will it be?

Guest 3: Unfortunately, I can't share that with you, but we are a. We are much, much larger than the last time we were on this podcast.

Guest 6: Okay.

Guest 3: So if I released that information back then, just think we're multiples bigger now,

Host: more than twice as large.

Guest 3: We would be on the top 100 list if we wanted to divulge that information.

Host: Okay. All right. The top 100 list. So whatever the bottom threshold is of the revenue on that top 100 list, you're north of the. That sounds good. And then, Mike, last question. Are you. You know, there's. Landscaping is. Is a space where there's a lot of private equity interest, public companies acquiring. So there's just a. There's just kind of a pretty well known path. Pretty well known path to Mike. Just by the way, audience. Mike just wrote down on a piece of paper and shared with me his revenue number. So I know it, but I won't share it with the audience.

Guest 5: I did not.

Guest 3: That is.

Host: That felt really cool. I felt like somebody slid a piece of paper across the, across the table to me. Mike. So buying, excuse me, growing quickly and then exiting, having a nice big exit to a larger, say, public company or private equity company is something you hear a lot about in the landscaping business. Is that your, is that what you're pursuing?

Guest 3: You know, ironically, we've had a couple of the strategic guys reach out to us recently in the last couple, you know, 30 days. Because again, as we're buying bigger and bigger companies, we're getting better brand recognition. And the number I just showed you is going to be even bigger by the end of this year. So we're attracting attention just from being kind of known as a buyer in the industry. French strategics, you know, coming to us, it's optionality is always good. We don't have a path for sure, for certain, but like I said earlier, I mean, we want to be a player in this industry and selling early is not the way to do that. And it's funny, you always have those questions on Twitter, like, would you rather take a million dollars or take a penny a day and double it or whatever. And compounding is real and the better businesses we buy and the longer we hold them, the better success we're going to do. And because of the support system we had and the capital structure we have, we have no fun life. We're not forced to sell anything. So if you want us, like, you're going to have to pay a pretty penny for us to get out of this thesis because we believe in it and we are armed and ready to go and fulfill that thesis.

[1:42:29] Host: You hear that bright view? Mike? Mike, I got a. Sorry, I just got a couple more questions that, that occurred to me. I got to ask. You're making it look easy, man. You got into this less than two years ago and, you know, it's a big number you're showing me. And you know, you've got, you'll. You're looking at having maybe five, six, maybe seven acquisitions by the end of the year, maybe more in a very short amount of time. Is this, do you think that you're. And you do talk about how difficult it is and how hard you're working. So, so no, no questions on that. But Is this something that, you know, I could. You feel like I should considering repeating doing a playbook that I should follow in my own market? Here I'm in Northern Virginia. I was in San Francisco, you know, is this something that people in major markets around the country should consider doing or is there something special you're doing or special about your market or what?

Guest 3: I'll answer on a general census. I just. In landscaping, I would never buy anything that's dependent on snow revenue. Just as like a baseline you look at, you know, you mentioned Brightview. They're publicly traded. You can read their earning calls. They have volatility based on weather each year and their earnings go up and down based on that. So I would never do that. But to your general point of buying a commercial landscaping business? I mean, yeah, I mean, I think, you know, my part of my thesis was an industry that doesn't trade for all that crazy multiples relative to other industries with equal earnings. It's a pretty good one to be in. You know, it's a grind. You gotta have good people and, and the, you know, another secret to our success is the team behind me, right? Like, you know, my partner and you know, our investor base has really never made themselves public, even though I told them I don't care if they do, but they're amazing. I mean, it's. I, I would be nowhere near where I am today if I didn't have the partner, you know, the invest investment base that I have, you know, so surround yourself with good people, man, and good things happen, I think.

Host: Yeah, that's great, Mike. Well, I was going to. I'm not sure there was a question here, maybe more of an observation, but I remember in our first, in our first interview back in July, part of the reason you bought a landscaping business was because you were cruising down the road during COVID at your day job, your W2, commuting in your W2, and just seeing all these landscaping trucks around and, you know, in the peak of COVID when everything else is shut down and, and you said to yourself, man, well, I guess landscaping is not only recession resistant, but pandemic resistant. You probably have different thoughts about the industry now, the pros and cons, but I just think it's cool how a germ of an idea can turn into what you've built in less than two years.

[1:45:07] Guest 3: Listen, man, when I told my mom we had the moment for Thanksgiving dinner and my wife and I told my mom, we're leaving, where I was, which was an unbelievable, you know, where my whole background, but, like, where I came from, it was unbelievable setup I had and great deal and all that kind of stuff. And I said, hey, I'm leaving to go buy a landscape. She literally cried like, don't do it. You're an idiot. So I appreciate that, Mom. So, yeah, I mean, it's a crazy, crazy journey so far, man.

Host: Cool. Cool. Well, congratulations on your success so far, Mike. Look forward to, you know, sending you that plaque when you're. When you're guest before appearances. Maybe sometime next year. I'll let you go, sir. Thank you very much, and congratulations.

Guest 5: Thanks.