Host: Today's interview is about emotional resilience. It is the story of a small business acquisition gone wrong. But it is not about fetal position moments and tears. Dustin Fusillo, who bought an ATM parts and services business, handled the decline and ultimate shuttering of the business he bought with stoicism. Not to say that it was easy or that he just breezed through. He was disciplined about his mental health as things went sideways. He leaned on mentors and friends and Dustin had toughened due to events in his personal life in years prior. So in today's interview you'll hear from someone whose acquisition went in the wrong direction fatally, but he did not let it consume him. Not only that, he actually landed on his feet. Please enjoy this unusual story of first time business buyer Dustin Fusillo announcements two great webinars this week, Today, Thursday and tomorrow, Friday. You can register for each of them in today's show Notes or right on the Acquiring Minds homepage. AcquiringMinds Co Today, Thursday, September 26 Attorneys James David Williams and Bill Barlow, whose entire practice is devoted to business acquisition, return for legal office hours. This month's topic is deal structure. James, David and Bill will go over some basics like asset deals versus Stock deals, but they're also bringing along a tax expert to go over Freorg, qsbs S corps versus Partnerships and other topics they frequently get asked about by searchers. So come with your tax questions this month. That is today, Thursday, September 26th noon Eastern and then tomorrow, Friday, September 27th. Searcher Dave Lewis, who bought a blue collar business, recently hired an operator to take over, allowing him to step out of the business while retaining ownership, a major step in any searcher's journey. And Dave is going to walk us through how he recruited Hobby, hired, and most importantly trained this operator to replace himself. That is tomorrow, Friday, September 27th noon Eastern. Register for these webinars in today's show notes or right on the Acquiring Minds homepage. Acquiring Minds Co. See you in the webinars. 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 podcast I talk to the people who do it. 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 Oberly 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 Dustin Fusillo, welcome to Acquiring Minds.

[3:49] Guest: Thank you very much. Excited to be here.

Host: Will Dustin, we have quite the journey to cover today. Even though it all happened over the course of just two or so years, I think it's fair to say we'll get into the timeline. But I want to thank you at the outset for coming on. Dustin, you're doing this to help other entrepreneurs hopefully avoid the pitfalls that got you. So this is, we really appreciate that. And let's get right into it. Start us off, please. Dustin, with some background on you.

Guest: My first entrepreneurial journey when I was about 11 years old, I wanted to get a new bike. And you know, as you know, bikes were kind of like the cars when you're a child. So I wanted a cool bike. And my, my mom was like, all right, you got 100 bucks to buy a bike. And I was like, well, that's not going to be enough because I want this bike. That's $400. And and she said, well, you need to figure it out. So I went to my dad and I said, I, I really want to generate this money. Can I borrow some lawn gear to do this? So he said, absolutely. Started knocking on doors. A lot of my neighbors probably had a lawn service. But, you know, just really believed in me and gave me an opportunity. So I said, Hey, 10 bucks for the front, 10 bucks for the back, $20 per house. Let me mow your lawn. So I did this. I spent the summer mowing lawns. And I was so proud. I saved $400, went to the bike shop, I already had the bike picked out. And I walked in and I said, I want this bike. He said, Great, that'll be $428. And I was like, what? And he goes, oh, well, you have to add sales tax. And I was like, wait, who signed up for sales tax? I don't want sales tax. And I think the guy, like just saw how, like crushed I was. And he was like, all right, 400 bucks it is. So I was able to, yeah, to walk out with the bike. And I just remember Will, like the pride I had. I took care of it, I cleaned it every day. And, you know, rolling up to school with that thing. And it really kind of changed my perspective of work and money and not having it. So that, that was a really big, big change for me. Right after school, high school, 19 years old, got my first real sales job. It was a retail sales job, kind of like a Circuit City, if you remember Circuit City. So high end appliances, electronics, we had home, home theater stuff and then some furniture. And I was working with veteran retail sales guys. And this is kind of the end of the heyday of retail sales, where that was actually a profession you could make really good money. These guys were really skillful and a lot of them took me under their wing. And I began to learn the psychology of people, how to read body language, how to, how to communicate effectively. And it was a really good opportunity for me to learn. My grandfather was a veteran salesperson, outside international salesperson. And he told me, never ask somebody how they're doing. So I was observing one day, you know, you're in kind of a lineup system, and one of the guys walks in and my colleague goes, hey sir, how you doing? And he goes, well, I haven't taken a crap in two days, my wife's sick and my fridge is dead, so how do you think I'm doing? And I was like, oh, that's why you don't ask somebody how they're doing. He always said, say, nice to see you or welcome in. So that was another opportunity for me to kind of learn and grow my profession. Well, fast forward to college. Partied a little too hard in college. Did make it through, even made it through grad school. So I'm able to get a job working for a angel investor. And he wanted to start a private school in Braden, Florida to compete with IMG Academy. It's a very elite academy down there. And I said, sure, I'll do it. I'm down. And that was my first opportunity to be in a startup. We literally built a school from nothing. The school still exists today. There's hundreds of kids there. It was an amazing opportunity, but as you know, it's very difficult to start a school. A lot of regulation involved, but I was able to wear a lot of hats. And I really kind of found my calling. I love organizing chaos. I love planning things out and growing and working with people and hiring teams. So that was when I was like, okay, this is what I want to do. How do I get to the other side of this and be the guy with the money to help build and grow things? So that's when I started to kind

[8:24] Host: of read and learn this Being starting, start starting businesses. Basically entrepreneurship.

Guest: Yep, yep. Just, just totally fell in love. So I kind of worked myself out of a job. We ended up investing in about 11 different companies. So I got to sit in the pitch meetings, interact with private equity professionals, and eventually I just kind of shifted from all the different roles in the school. I started to help grow two other businesses. And then he finally was just like, look, we really don't have a role for you anymore. You've been phenomenal, but we don't see a place for you. Because I was really high level in the organization and I said, fine. So I was able to pivot, get into H Vac, go back to my sales background. And that was where I began kind of fine tuning the skills I had learned early on in the, in the home services world. We sold plumbing, electrical, H Vac and home generators. Awesome opportunity, had a lot of success. But as you probably know, in, in these kind of small businesses, I hit the ceiling really fast. And, and the company just couldn't grow fast enough for my sales. So it was kind of capping me from an income standpoint, but also from a development standpoint. I really wanted to find ways to grow. And it just was a small business. They were a really good business, good people, but there's just only so many positions to move into within a small company. So that's when I took my first chance into entrepreneurship. Late 20s, early 30s, I'm married, living in Bradenton. And we had some financial stability. And I went to my wife at the time and I said, I really want to take my first risk here. So we met up with Jim Abrams. So Jim Abrams was the founder of One Hour Heating and Air. It was kind of an online tool for H Vac, for people, customers to go on E commerce, kind of model, pick their system. It gives estimates. It was kind of a lead generation software. It just didn't work. The problem with the industry at the time was the contractors were making 40 to 50% margin on this stuff. And even if I were to say, hey, I just want 10% of the deal to give you all these leads, they none of them were interested. And I was obviously connected with an industry I already worked there, went to a lot of my competitors, even my own employer, and they were like, we don't really see a need for this right now. So lost money, wife is not happy. And I was pretty, pretty discouraged. I went through a divorce. Very, very painful time in my life. It showed me that I did not have the emotional capacity to handle high levels of Stress. I had spent a lot of time focusing on business, finance, real estate, even fitness and nutrition. But I had skipped over this emotional and relational piece of the pie, which is super important. And I had a lot of support from friends and family, but I just did not have the capacity to deal with this level of stress. And it really showed me the importance of focusing on that piece of it, which is. That's what I wanted to kind of share with your audience. Because, as you know, this is a really difficult thing to do. And as we'll get into a little bit later in the interview when it doesn't go well, you want to have the skills and the capacity to deal with the stress in an effective way. And having lost a few thousand dollars back in my first H Vac franchise investment, that was really difficult. And then I think about just recently, and we're foreshadowing a little bit here, but losing much, much more than that, and being able to. To stay objective, stay in the pocket, figure it out. And it allowed me to really grow professionally via emotional growth.

[12:27] Host: So you were ill equipped to handle a divorce. I mean, who is. Who is equipped? But. But you being forced through that crucible grew a lot.

Guest: 100%. 100%. And I saw friends go through similar life events, illness, financial issues, divorce. And it's really two paths. You can learn to grow from the pain, or you can just numb it with substances or working or there's a lot of ways to kind of numb that experience. And it's a decision. So I want to help your audience make the right decision during periods of high stress, because it can be a beautiful thing. And as I've built a network of very successful people that are mentors of mine, they've all gone through this. And the decision was the path of how do I learn and grow from this pain? Instead of I'm a victim or I'm never going to get over this. As I said, I was kind of bumping up against the ceiling, and I get offered a job. I was like, this is great. This ties into what I want to do. It was an account manager position. I had 22 accounts, which is 22 small businesses. So I thought, wow, this is a great opportunity for me to look inside of businesses, see how they work and learn, and then I can apply that to my future goal of buying my own company, take the job, had a lot of success there and became very close with a lot of business owners. My accounts ranged from 500,000 to $40 million in revenue. So I had everything in between we would go to conferences where we had companies that were $200 million in revenue to kind of see how it worked at scale. And what I learned from this will was that business is not perfect. Every one of them, 500,000 to 40 million, were messy. Really, the biggest takeaway was, you know, in my mind, I'm thinking, okay, at 40 million, they're making several million dollars in EBITDA. They've got all these processes in place. They had the right team. It was just. It was just messy. And it always is. I'm sure there's some out there that are perfect or close to it, but. And not in my experience. So really learned a lot. Around this time, I was able to have dinner with a private equity professional. I had a friend in town. He was fundraising for his medical device company. And we had dinner. And I'm just, like, sitting there listening and learning as I'm like, this is the guy I want to be one day. And he's talking to me, and I said, you know, what do I need to do to get to where I want to go? And he said, you're there. You're already there. He said, I interact with operators, business owners every day. You have what it takes. Go do it. Stop learning, stop planning, stop thinking about it. Take the risk. Go do it. So that was really encouraging to me, but I still. I wasn't quite ready. So right around this time, I'm excelling at trade. I get offered a promotion. And the promotion, as you probably know, in corporate America, it's always strings attached. So in my role, I'm making about, I would say 60% of my salary is base and 40% bonus. And the new role, they say, well, we can only give you a 10% raise on your base. And I'm like, well, that's nowhere near what I need. And the job was like, twice as much work, great exposure, but ultimately just wasn't a fit. So I call the VP who offered me the job, and I said, I decline. And he goes, what do you mean you decline? He's like, you're a rock star. Like, we want you on the team. You know, you just give us a year, we'll get you where you need to be. I said, honestly, man, I've spent enough time working for other people. I'm going to do my own thing. He goes, well, what does that mean? I said, well, I'm going to sell my house, I'm going to sell my investment properties, I'm going to liquidate my retirement, and I'm going to buy a business. And he said, that's a great plan. You're going to do great at that. So thanks, Dan, for the encouragement because that was what I needed. I needed the private equity guy was on the other side telling me I'm ready. I have the VP of this company telling me I'm ready. So at that point I shifted to full time search.

[16:48] Host: You'll recall hearing about the inaugural M and a launchpad conference on acquiring minds back in the spring. The event brought together searchers, seasoned business buyers, owners and private equity investors for a single day to go deep on buying businesses. Well, it was such a success, the organizers are hosting a sequel in October. Walker Deibel, author of Buy then build is keynoting and 30 other experts will be on hand sharing their journeys to acquire, operate, scale and exit their businesses for significant returns. It's happening October 26th in Chicago. Use code acquiringminds@malaunchpad.com for a $200 discount. So if you missed the event in the spring, here's your chance to attend in Chicago on October 26th. And with a $200 discount, go to Malaunchpad.com or click the link in the notes and use the code acquiringminds. All one word. Dustin. That was a fantastic background. I, I love understanding where the motivations were and especially hearing kind of the theme of not feeling like you're ready, not feeling like you're ready, not feeling like you're ready. Always kind of being addicted to preparation. I feel like that's something that people do but you ultimately decide you're going to do this. What are the parameters of your search? What do you look and sorry, where are you at this point?

[18:21] Guest: You're.

Host: You're in Florida still or. Yeah, in Florida.

Guest: I'm in Florida.

Host: Tell us about the parameters of your search.

Guest: Sure. So we are industry agnostic. A million dollars in EBITDA was the target. All the typical stuff. I wanted 10 years or more of history. And I had targeted the state of Colorado because I was, I had grew up in Florida. I love the beach, I loved the ocean and boating. But I really wanted to just change of scenery. Single guy obviously went through a divorce and I was like, man, if I could live anywhere, where would I want to go? So chose Colorado as a target and then I won recurring revenue. So all your typical kind of hallmarks for, for this, this lower market search.

Host: Okay. And so do you only search then in Colorado and are you in remotely or. So you're searching in Colorado from Florida?

Guest: Exactly.

Host: With the expectation that you'll move when you find the thing.

Guest: Yep.

Host: How does it go?

Guest: It goes pretty well. It was a little discouraging as your audience knows a lot of learning how to read PNLs, learning how to read between the lines on the P Ls and, and the SIM. And we'll talk a little bit about that in my experience, because as you know, these brokers, they're salespeople, so they're always trying to highlight the best of the best, maybe inflate a little bit and you got to be able to read between the lines. And I learned that through my journey. So finally found a deal. It was a manufacturing company in Colorado, had been around for 30 plus years. 3.6 million in revenue, 1.6 in recurring, 1.2 million in SDE. And I was able to negotiate a 3 1/2x purchase price. I wrote the, the seller a very, again, emotionally kind of leaning email about my journey and why I wanted to be in business. And he was like, I think you're the guy. So we negotiated a 10, 10 to 2, 80 for him, 280 for me. And then my debt service was 400,000. So I had 400,000 left in available capital. So the SIM said 1.2 million, but the real SD was about 800. And that's kind of where you have to be able to read between the lines.

Host: Yeah.

Guest: So we schedule a closing for December 30th of 22. And I am in full on sales mode. I have sold all my furniture, my house is for sale, everything else, you know, full liquidation to get this deal done.

Host: And had you flown out there, Dustin?

[21:01] Guest: I had flown out there multiple times, did the tour, met the team, felt really good about it. You know, what was, you know, a little bit scared. Obviously it was, it's all my money. And then I'm signing a very big personal guarantee with the SBA to get the deal done. But also learned a lot from the bankers too. It's, you know, your diligence team is, is, is key. They do this every day. So having the right diligence team to ask questions, to learn from was, was huge. So I, we're pretty much done. Diligence is done and I move out to Colorado. I quit my job. So I had about a 30 day window there. And, and on December 14th I had to walk.

Host: Wow.

Guest: Yeah.

Host: So you, you quit your job, uprooted yourself, sold your house. What were you living in, in Denver or where were you crash? Is it, was it Denver?

Guest: It was Denver, yep.

Host: Where were you crashing?

Guest: I was in an apartment downtown Denver. I had signed the lease. So I'm locked in. Yep, locked in. And I also had no car because I had a corporate vehicle at train.

Host: So.

Guest: And I'm planning on buying a car once I bought the business.

Host: Yeah.

Guest: So everything is just kind of falling apart.

Host: What happens? Because this isn't, this isn't the main acquisition. But tell us quickly what happened with this. Why did it fall apart?

Guest: Well, what I learned from this deal was I needed the work in progress ratio to be fair and laid out before we were close, close to closing the deal. And a manufacturing company work in progress is a huge amount of revenue, cost and profit. Inventory was not cleaned up and talked about. And as I said before, the 1.2 million versus 800,000, the seller was not burdening the P and L with the fair market value on the rent, among other things. And what killed the deal for me, there was some risk, there was some hair on the deal. We had, you know, high, high customer concentration, 65%, a little bit of key person risk. But what really killed the deal was very last minute, early December, I get a triple net lease on the seller's building. We had negotiated a lease to own because you're not going to move massive manufacturing, you know, machines. And this building had, he hadn't put a diamond to it in 30 years. His dad bought the building in 50 years ago. And I mean literally we had the thermostats are falling off the walls, lighting is. Can barely see. And this triple net lease. My attorney called me and she said, I've been doing this for 25 years. I have never seen a more aggressive terms on a triple net in the seller's favor in my career.

Host: Yeah.

Guest: She goes, you need to walk away from this. I said, what do you mean? She goes, well, this shows the kind of person that he is. Yeah, because he wants you to basically spend the next three to five years fixing his building. That again, didn't burden the P and L with pay him fair market value for the lease and then buy it from him at a, at a surplus. She's like, that's not the kind of person you want to go into business with. Called a bunch of my friends and got their advice and ultimately walked and lost $32,000 in diligence.

[24:23] Host: And do you feel like once she had kind of crystallized this theory that this was a tell about type of person he was that there had been other signals as well that he was such a person?

Guest: There was other signals that she had warned me on, early on That I was like, no, no, no, no. He's a good guy. He's a good guy. You haven't met him, that kind of thing.

Host: Okay. Okay. All right. Okay. So there you are. Denver carless, jobless, prospectless with a lease.

Guest: Correct. So we are in cash burning mode. Actually a new term I just learned. Capital incineration. That's really fun.

Host: So we have high capital, that money into the incinerator.

Guest: Exactly. We. Capital incineration at this point. So I'm. I'm sweating and I'm thinking in my. In my mind, I'm like, okay, do I go back to train tail to my legs, hail my job back? Do I try and find a job in Denver? What. What do I do? And honestly, will I. I was just like, I would rather run out of money or fail doing this than go back to W2. I. I had. I had switched. I had gone so far to. I am done W2. Working for other people. I need to just take the risk.

Host: Yeah. I mean, it's striking, Dustin, because you had kind of been dragging your feet to take the. To take the plunge, but once you took the plunge, you were a guy on a mission.

Guest: Exactly. That was it.

Host: Yeah. Great.

Guest: That was it. And again, like the mentorship, the friendships, one of the gentlemen we talked about earlier, those were key because I called them and they're like, stay with it. This is. This is part of the journey. You're learning. You're being stretched. So it's just that mentality of using every negative and turning it into a positive.

Host: And at this point now, are you connecting the stress you're feeling to the stress muscle you'd built in the wake of the divorce?

Guest: Absolutely.

Host: You're like, if. If earlier me wouldn't have been able to handle this, but today I can handle this sort of thing.

Guest: Exactly. Yep. That's the point is I lost 10 times more money than I lost whatever three or four years ago. And I'm just sitting there going, okay, that's my tuition to business school. Just pay that won't make that mistake again.

Host: Yeah, hopefully. Yeah. Yeah. Well, yeah, Things haven't even gotten interesting yet.

Guest: Then we get into the interesting stuff. All right, so this is January of 23, and I'm in full on networking mode. So now I'm knocking on doors of these. These brokers and I'm like, hey, let's do lunch, let's do coffee. I'm going to bankers. And it was great because I was there. So before, when you're a guy in Florida trying to get A deal in Denver. They're like, yeah, yeah, yeah, whatever. I mean, I had built some street cred because of this deal, but being able to be face to face and having coffee with these people, that really helped. Funny side story, I did attend a networking event for private equity during this time. I thought maybe, well, I can be an operator. And I had a meeting with a capital provider and she's like, well, what's your buy box? And I'm like, I'm looking to 7 to 10 million. And she goes, oh great, we write checks at 10 million EBITDA and up. And I was like, oh no, I'm not on that level. So that was interesting, humbling. That was a true middle market event. But that kind of exposed me to kind of the next level of what, you know, many of us and our guests, your guests do. So I get a call from a broker. It is an electromechanical repair business and it is struggling. So this is a turnaround. And he says, hey, you know, you've got the sales acumen to get this thing going. They haven't been spending any money on sales or marketing. There's no website, barely functional. It's a legacy business, been around for 30 plus years. Good reputation. What do you think? So I look at the financials, I do see some very high margin categories. There's some recurring revenue and I can pay cash for the deal. So now I go from highly leveraged multimillion dollars in debt to cash deal. Maybe I can turn it around in a year, start pulling some cash out of it, pay myself and end up taking the risk. Met with the seller, obviously did the tour. The whole thing didn't go as deep as I should have with the diligence. I had just lost a bunch of money and the deal was so small I didn't felt like it necessitated a true quality of earnings or, you know, the real deep stuff. So we did kind of cut corners. I did have two different CPAs take a look. But what we discovered was there was a lot of things that were not just accounted for correctly. Even though the amount of money coming in and out of the bank matched the balance sheet, it. It wasn't really there. So I can't go into too much detail on this Will, because I did reach a settlement with the seller to avoid litigation.

[29:28] Host: So this business, Dustin, is what can you say more specifically about what it, what it does?

Guest: Yes. So this is in the ATM sales and repair space.

Host: So you service ATM owners, correct?

Guest: Yes, the deployers of ATMs, we sell them and repair and sell their parts, the internal parts and components, and seller parts.

Host: Okay, and what can you tell us about the business? You said it was, it was in distress. How old was it, number of employees? And then we'll see if you can share any other numbers. But how old and number of employees?

[30:05] Guest: 32 years old. We had 16 employees, low seven figures in revenue and very, very little EBITDA.

Host: Okay, and understanding that some of this is sensitive, what was the structure of the deal? I mean, if you can share all of the numbers, that'd be great, but if not, what was at least the structure? You said it was affordable enough that you could do a cash deal. So tell us more, please.

Guest: It was a strict asset sale, so there was no multiple. It was just, we added up the inventory, FF&E and I made an offer based on what we thought the fair market value was, minus a discount.

Host: Okay. And the inventory included all these parts for ATMs. Okay, and what did you, what was the value of those that you came to?

Guest: It was under a million dollars.

Host: Okay. And so your thinking here was lower risk because it's, there's not going to be a SBA loan.

Guest: Correct.

Host: And it's a small deal and obviously you had confidence that you could turn it around. Why was the business struggling so badly? And why did you think that whatever was causing it to struggle, you had the answer to?

Guest: Great question. The owner had been absentee for about five years. So he had a divorce, he had an illness and kept bringing in GMs to run the business, but not paying them a GM wage. He's paying them like a middle manager. And so you're not going to get a high level GM at those numbers. So every GM comes in and they say, well, we're going to change all these things and we're going to do, we're going to make these improvements. And then they just stop caring, they get fired. So massive turnover with leadership, very little involvement from the owner. And he, he was just done. So not a lot of investment, as I said, in the business with marketing and sales. It was just kind of, it was just kind of on autopilot. It, it, the heyday of the business was probably seven years before they had, they had some recurring revenue, they had some good process in place. So they were just kind of coasting okay down.

Host: And, and so you felt that with some attention in tlc, as a new owner, you could basically just get it on the right path through willpower and just giving the thing attention. I mean, he's basically checked out the owner.

Guest: Right. And, and also high fixed costs. They, they were in a space that was probably twice or three times as big as they needed to be in. We had some fat on the payroll, so I, I figured we can cut down some of our staff, keep the eight players, incentivize them, pay them a little bit more. We had about, I think it was about 12 months left on the lease, so I figured we could just write out the lease. We brought in a sub tenant to offset the lease. The, the rent was crazy. $25,000 a month in rent.

[33:07] Host: Yeah.

Guest: For, for a low seven figure business. So I'm thinking, all right, we bring in a sub tenant, got that checked off, we get out of this building, we downsize, we cut the staff, we increase sales, we target things that are high margin. We do all the, you know, marketing, networking, all that stuff. We nurture our recurring customers, try and enhance share of wallet. I can turn this thing around and I don't have the debt service, the $400,000 a month in debt service or a month, a year on the previous deal.

Host: But you were going to have. There was a seller note here.

Guest: There was a seller note. Correct.

Host: So there. And we'll get into that in a second. But. So there was going to be some debt service.

Guest: Yes, but it was on full standby for a year.

Host: Ah, okay. Okay, great. Well, I want to hear about that in just a sec. So you're making an argument for why you can turn this around, Dustin, that makes, that sounds good and makes sense still. This is your first at bat. So in retrospect, do you feel like you were. I mean, the obvious question would be, was just an overconfident or no. In fact, you do feel like if some of the things that we're going to find out happened, hadn't happened, in fact, you could have turned this thing around. In fact, it wasn't overconfident, it wasn't crazy that you bought a turnaround as a first at bat.

Guest: I think both are true.

Host: Okay.

Guest: I had confidence in the turnaround will because of the startup, because I had built something from nothing. And that's kind of how to look at. Exactly. That's kind of how you have to look at these companies. So the traditional wisdom of, you know, observe for six months and don't make any changes and learn. That's not applicable here. You are bleeding money, you're bleeding staff, you're bleeding customers. You have to make changes quickly. Sure, I made plenty of mistakes focused on the wrong things. When you're in a Business like this, there's just fires to put out all the time.

Host: Yeah.

Guest: And you're. It's hard to really just discern what's important to the overall business, what I should be working on as the owner versus delegating this to somebody else. And that was one of the traps I fell into.

Host: Okay, okay. And the prospects for the business assume it wants everything kind of the internal, the internal, sorry, dysfunction. The internal dysfunction. Once you had addressed that, the market that it was in, you liked. So you were going to be an ATM guy, not with his own ATMs but ATM parts and servicing in the ATM business. How did you think about that industry? One of the obvious things to say there is that we're all using less and less cash. So how did you think about the long term prospects of ATMs?

Guest: Great question. And the idea was to flip it fast. There is a decline in cash usage, mostly lower income, illegal immigrant, you know they call em, the unbanked is the category. Cash is still in circulation, but as you know it is declining. We've got Mobile Pay, Venmo, PayPal and we also have obviously credit cards which most folks use. So again I was looking at it kind of through the lens of flipping a house. You go in, you clean it up, you sell it. I go in, I clean it up, I sell the business. And the idea was to use the capital from the proceeds to buy a much bigger company. Now I got a little bit of experience, I would feel more confident taking on more debt to buy a larger, larger entity.

[36:42] Host: And do you feel, was there a sense of eagerness in you to urgency to get going because of, because you'd moved and you'd uprooted yourself from floor. So that was also a factor, the emotions here.

Guest: It was all that work I had done to get the emotional resilience. It, it did a little bit work against me because I was like not being as objective as I should, as I should have been. Yeah.

Host: Well Dustin, I mean in your defense, that's a common pattern in this world where if somebody's searching for longer than they feel comfortable with, may be it one year or five years, however long it is for that particular person, they will lower their standards. And sometimes that is appropriate because maybe they're looking for perfection, as we all know doesn't exist. So they're looking for perfection. So maybe it's appropriate that they lower their standards somewhat. Other times maybe not. Maybe they lower their standards too much just because of their eagerness to get to, to get into, into the seat it's hard. It's a hard one. Yeah. And really, maybe the right answer there is. You can only tell, looking, looking in retrospect, should I have. Should I have bought that deal or should I not have? All right, and so now please tell us what you can about the. The structure of this deal. You. You said. You said inventory only, but tell us more about the seller note, et cetera, please.

Guest: Yes. So did. Did negotiate a seller note on full standby for a year? I figured after a year, again, I'm lowering my. My fixed costs. I'm lowering overhead. I've got an opportunity to build some revenue and high margin. So it gave me enough time to turn things around and before I started paying on debt. So that was key here, Will, because I had leverage, which I think many of your guests recently have talked about. The importance of a seller note because they have to have skin in the game. If. If they want 100% out, there's probably a reason for that. Unless they're terminally ill or something, they need to have skin in the game here because either they don't believe in you or they don't believe in the business or both. It was reassuring in some ways and others I was surprised because I'm like, why would he agree to that? And I actually called him and I'm like, why would you. Like, you know, I'm a sales guy, so I'm trying to negotiate the best deal I can get. And I'm just like, it's. I was like, it worries me that you are willing to do this. High level of a seller note. Totally is like, well, I'm just. I'm ready to be done. And. And I, you know, I want to make this happen for you. And it's. He said all the right things.

[39:13] Host: Totally. No, that is such a good. And not sure this is the right word. Funny point where no seller note, no seller doesn't have any skin in the game. That's a flag.

Guest: Yeah.

Host: Too much seller note. Also a flag because it represents just. It's effectively effectively them lowering the price, making the sweetening and sweetening and sweetening the deal for you buyer. Why would they want to sweeten the deal so much? Another. Another potential flag that they're just. They want to unload this thing.

Guest: Exactly.

Host: There's a sweet spot here. It's not. It's not as simple as the more seller note, the better.

Guest: Exactly.

Host: Yeah.

Guest: You want them to show a little bit of pain when they're agreeing to whatever the split is the ratio on the seller note. Or the earn out or whatever it might be. And also, why is this deal still on the market? Know that it's one of those things where you're like, am I the luckiest guy on the planet or am I the dumbest guy on the planet? Because clearly he's been trying to sell us for a while. Man, it looks really good to me. I mean, I, I certainly somebody else that has sales experience and operational experience can turn this thing around. So why didn't they buy it before I did?

Host: Yeah.

Guest: Another question you got kind of ask yourself.

Host: Yeah, that's such a good one. Okay. Anything more to say about the structure of the deal or do we have it there?

Guest: That's as much as I can share.

Host: Okay. All right, so you move forward. Tell us about what, what it looks like once you get inside.

Guest: Get inside. I realize I, I do have a pretty solid team at the, at the top. I have some middle managers that are really, really good and I can lean on them. So I start to do a deep dive into the financials and from a transactional level and I find some high margin activities. So I'm thinking, great, let's go sell more of those things. I go sell more of those things. After a month goes by, we do the numbers and the margin's not adding up and we're like, wait a minute, we're supposed to be at a 60 plus percent margin on this sale and we're at 7 margin on this sale. So I'm like, oh. So we, and again, part of his absenteeism, there was a lot of changes with the bookkeeper and how they were doing the chart of accounts. And I mean it was very, very messy. So my mind initially is, well, the books are just messy. We just got to find this out. So I hire a second bookkeeper to literally go through transaction by transaction, clean up the chart of accounts from 321 to 110. And we, we start to realize that that this category, this revenue category, there was no cogs being applied to it. So again, from the beginning of conversation, from the CPA standpoint, the money in, money out, high level, it checks out. But on a transactional level where I'm thinking as the buyer of I like these 40, 50, 60% margin revenue categories, they're not there. So that's where.

[42:29] Host: But, so, but if, if the, and when you say from the CPA standpoint, money in, money out, accurate, you're talking about the tax returns.

Guest: Exactly.

Host: And the bank statements and the matching with the bank statements. Matching what the Seller was claiming.

Guest: Correct.

Host: So, and, but then, but then you look at these where what you thought were really high gross margin opportunities to ended up not being. But that margin must have been then somewhere else. It still must have been in there somewhere. Right.

Guest: The cogs were applied. They were kind of scattered in multiple different categories. So I call the seller on speakerphone and we're in the room and I got two bookkeepers, my ops guy, and I say, hey, help me understand what we're doing here. And he goes, oh yeah, that's really complicated. I've been trying to figure out how to apply cogs for years to that. He's like. So I just eventually just started doing it in my head. And I just figured at the end of the month if I was making money, then we're good. True, true story. I was like, wait a minute, you were doing the cogs in your head? Yep. Okay. And that was when I knew I had made a big mistake.

Host: So he was therefore under reporting cogs by a lot. Even, even, even though still the bank statement lined up with what he was claiming and profitability. Okay.

Guest: And again, I'm not saying that this was intentional. I hope it wasn't. I think it was just a lack of organization, a lack of experience. I mean, not experience. The guy ran the business for 32 years.

Host: Yeah.

Guest: Who knows? I try to give him the benefit of the doubt. I don't think it was nefarious. But man, it's like, how could you do any kind of accounting in your head?

Host: Okay. And at this, do your. The other people in the room also appreciate how.

Guest: How the pick up everybody off the table?

Host: Okay. Okay.

Guest: So I'm going around picking up jaws and I'm like, okay, what just happened? How do we figure this out? And then we literally just go into full on, like, let's clean the books as fast as possible and try and find something that has true cogs, true margin that I can then go out and sell.

Host: Okay. And just to be clear, the implications of what you just heard from the seller are that the business has been under reporting expenses. Therefore it, it looks like a much more profitable business that it than it actually is. So way less profit, way less margin

[45:15] Guest: by category profit was. Was accurate. That, that was not wrong. It's just the, the opportunity to grow the profit over time was not accurate.

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Guest: The deeper we got, the more messy it became. And I mean, we spent months on this, I mean probably three months, two people full time. And honestly at this point, it just became a distraction. So I decided that at the end of the year, we're going to just literally start over and we're going to start whole new books. And one of the mistakes I made here Will, was I took over his QuickBooks account. And the reason was, is the inventory management software they had was so ingrained with the QuickBooks and it was QuickBooks Enterprise that we would have to redo the entire inventory to get the books right to me to start with a fresh, fresh QuickBooks account. And I was advised by him and by the bookkeeper at the time to not do that. So instead of starting a clean set of books, I inherited his books and then tried to clean them up. Absolute disasters, as I said. I mean, every, every bookkeeper that came in every six or nine months would apply things to different categories and nothing made sense. And I had, I mean, I had income and cogs and cogs and income and it was just a complete disaster. So the problem here is I now can't believe anything my books say.

[48:06] Host: Yeah.

Guest: So I have to go in and manually run my margins per sale to make sure that I'm making money. And then I start looking at my repairs and I've got at the time, nine people doing repairs. And I go, man, I bet I'm losing money on repairs that we're doing. And sure enough, we did a repair audit. And probably 20% of my repairs. I'm literally losing money every time, regardless of how fast the repair is done or, or how little parts were used. So just very, very discouraging time. And eventually we just burned too much cash, incinerated Too much capital, and we ran out of Runway. And then it really boiled down to how much money and time do I want to put into this business that I know is in an industry that is not growing, it's mature, it's saturated. And the whole idea of, let's flip this thing, make a couple hundred grand and learn and buy a bigger one, it was just no longer viable. I mean, I could have called some friends and got money. I could have gotten a cash infusion, I'm sure, but I didn't want to continue to dig myself deeper.

Host: And so the business wasn't profitable when you bought it, was it also losing money? I guess what I'm asking, is the money that you are now losing as owner, month over month over month, are you losing more money than he was?

Guest: I was, because I was paying myself more than he was. He was barely paying himself, so I was paying myself below market, but I was taking. Taking a salary, and that was what was causing the additional losses.

Host: Okay, and how. Going back to the theme of this episode, the emotions, how are they at this point?

Guest: Very good. What are they? Yeah, yeah, they are. Yeah. Me. Even my office manager, her and I become very, very close through this. She's a very good friend. She's like, I don't know how you're operating like this. How I. I'm not sleeping at night, and it's not my money and my business on the line here. And I said, if I've learned anything from my journey, it's the question of does this emotional state impact the outcome? So when I'm looking at a P and L, that's wrong. Or I'm looking at our cash flow and we're negative, and we're negative, and we're maxing out our credit line every single month, and we're just barely making payroll. I'm not paying myself one week. She's not paying herself one week to make sure we hit payroll. Does being an anger or anxiety or stress change the circumstance? And the answer is no. And that applies to your entire life, usually. So that mentality of, well, living in fear or living in anger is not going to change it. So why would I live in that state? It allowed me to just remain objective, go into work every day. Now, granted, I had my. My days and I would go, thankfully, snowboarding. So Wednesdays, I would go snowboarding. It'd be like my. My personal mental health day. I'd get half a day in on the mountain. I'd come in the office around 1pm and I would be Recharged and able to kind of dive back in and try and turn things around. So I was in a. Still in a turnaround mindset, closing the deal in March. And I was in a turnaround mindset until probably the fall, October, November of that year. I just really tried to make it happen, make it work. And then by November, December, I realized that it just wasn't going to happen. So shifted to we need to sell this thing.

[51:42] Host: Well, Dustin, though, you're. It's very logical what you said about how. How does anger or fear or anxiety help me? Oh, it doesn't. Therefore I won't feel those things. But easier said than done. I mean, we none of us feel, let's say, anger or fear voluntarily. We. We don't like these emotions, but recognizing that they're unhealthy and counterproductive and we should set them aside doesn't mean that we just can at the snap of our fingers. So there's still. There's still something in you that. That allowed you to be able to set those emotions aside. I know that when I'm of those fears, probably anger is my weakness. I know that when I'm feeling hot, I can't just turn that off, much as I. Much as I kind of, you know, subconsciously know that I'm misbehaving. It's not something that I can just turn off, which is kind of the nature of anger, in particular.

Guest: It is. And. And funny thing about anger is it makes you feel in control. But for me, it's not the feeling itself. It's the duration. So I certainly had every feeling possible, but I didn't have a. A whole day or a whole weekend that I allowed myself to live in that state. So I would go into a panic for 10, 15 minutes, maybe even an hour sometimes at night. I did. I did have sleepless nights, but I just, again, I would apply the. It's a habit. It really is. It's a habit and a ritual of calming yourself, breathing, meditating. Did a lot of journaling during this time. Journaling is an incredible opportunity to reflect and just organize your mind and your thoughts and get it out on paper and was able to release those emotions. So it's not about not feeling emotion, it's just truncating the duration of the emotion.

Host: Okay, and. And you were. And you. Okay, so. But you were using techniques. It wasn't just armor that you built. You were proactively doing a regimen here.

Guest: Yes.

Host: In your case, journaling and maybe more meditation.

Guest: Journaling, meditation, calling mentors and friends for support.

Host: Okay. Okay.

Guest: I mean, my, my office manager, her and I would vent. I mean, she was great, very objective person. So all, all of the tools were utilized to get through this.

[54:02] Host: Okay. And what are you. Oh, I just want to. Before we start getting to the end of your ownership of this business, say again, something that you skipped over before but have said to me in the pre call a couple times. The quality of earnings, the analysis of the books, how you thought about to the extent that you did it and how you thought to. To what extent you should do it as a buyer. Say more about that, please.

Guest: Excellent question. Understanding how to read a P and L from a high level is one skill, but reading between the lines is another skill. Good accountants can do that, but if they don't know the industry, it's difficult. That's why I always recommend getting an accountant that's specific to an industry if it's big enough. Obviously the ATM industry is not big enough. If you're buying an H Vac company, you can certainly find an H Vac accountant to do Q of E. That's seen hundreds of companies.

Host: Yeah.

Guest: What I learned from that experience is you need to go down to the transactional level. So if, if I'm looking at it from a business owner perspective saying, okay, this revenue category is generating 60% margin, I want to go in and see 10 transactions start to finish. How much did we sell it for? How much did we pay the guys to fix it? How much did we pay for the parts? What was the shipping? How much did the box cost? Literally count every cent, every step of the product. Who was involved? Was there four people involved to ship one item or was there one or two? And that will give you an understanding of your inventory in and outs, your, your fixed costs, your overhead, your average, all those things. And I, I would do that across the board. Same thing on inventory. I should have taken 10% of the inventory and called around and said, hey, I'm guessing this thing is worth $400 retail. If I were to sell it in bulk, would you pay 300? Would you pay 250 for it? And figure out if you're. Obviously there's a service to do an inventory assessment and evaluation, but it takes months and it's tens of thousands of dollars. You're not going to do that for a company of this size. So this is kind of where you need to be careful about where you cut corners. No one's going to do a $50,000 quality of earnings for a business even under. Even under. 10 million. I mean, it's just not, it's not very common unless you have tons of money to, to spend on the diligence because as you know, sometimes you got to walk away. I've had multiple guys that are in this space that have lost 50, 60, $75,000 in diligence on multiple deals. I had one guy, he, the, the seller walked away the day before because he didn't feel right about it. It's like, he's like, what? I just spent $70,000 in diligence the day before he called and said, I just don't feel right about it. I want to be done. It's like, how does that happen? But it does. So you gotta be careful. Obviously you have to do it. But I think that's where the personal skillset comes in to where I need to learn the industry and the business enough to be able to do my own audit and at a micro level to make sure that I'm not missing anything or the CPAs are missing anything.

[57:11] Host: And so reflecting back, was this, was this a business that was in some ways unsalable really because it was too small for a proper quality of earnings to be done against it. But it would have taken a quality of earnings to really reveal the problems with it. Well, maybe the business was just so far gone it was, it was unsalable for that reason. Just because it was just like a money losing proposition.

Guest: Both.

Host: So very simply.

Guest: Both.

Host: Yeah, but, but it was in this weird sweet spot or anti sweet spot of being too small to justify the very, the very analysis that it so needed. The very kind of Q of analysis that's so needed. All right, so, so it's, you're getting toward the end of last year, 20, 23, you decide this is unsalvageable. What do you do?

Guest: I go into selling mode and I create a business valuation and I call one person. It was the head of our largest competitor. They're the biggest in the industry. I had met him at a conference and I, I didn't know him that well, but I had a lot of respect for him. He's a very genuine person. And I just told him what was going on. I said here, here's what's going on. I need.

Host: What did you say?

Guest: I'm sorry, what did you say?

Host: Say, what did you say?

Guest: I, I told him that I, I bought this company. We realized the margins weren't there. He laughed because he was like 60 margin. He's like, I do this at scale and I don't make that And I'm like, yeah, I learned that the hard way. Thanks. And. And he goes, yeah, we. We looked at buying that company a couple years ago, and we walked away from the deal. And I said, of course you did, because you know what you're looking at because you're in the industry, and I don't. And he said, look, we. We may have an opportunity to buy the inventory from you. We could probably use some of it. Let's. Let's take a look. So he sets up a call with the CEO and we get on a call, and within 15 minutes, it. The feeling of the call went from I'm trying to sell inventory to this guy to I'm in a job interview. So I'm like, kind of switching gears a little bit, talking about what I did right, what I did wrong, what I learned, how I can contribute to a new business. And it became pretty apparent that they weren't interested in the business at all. They were interested in acquiring it to hire me. I was already in talks with other investors to potentially be an operator. I was looking at startups as well. So I had opportunities, fortunately, to pivot, but I still had to get rid of this inventory in an efficient way because I had a lot of debt at this point, and I needed to pay off the debt. So they flew me out to Utah. I met with the board, and ultimately they made me a job offer and an offer on the business,

[1:00:13] Host: and the debt was the seller note. You were going to have to. So you still, Even though the seller was kind of the source of the problem for having mismanaged his books for so long, obviously doesn't mean that that seller note goes away. You need to pay that down.

Guest: The seller note was no longer part of the equation.

Host: Ah, okay. Yeah, but what debt did you have?

Guest: I had the credit line and then vendor debt.

Host: Credit line and vendor debt. Okay, and how much debt was that?

Guest: Can you say multiple six figures.

Host: Multiple six figures.

Guest: Yeah.

Host: So you had multiple six figures of debt hanging over your head. The seller note was. No. Even without the seller note, which was no longer in the picture, a little

Guest: bit of cash left. I had. I had an emergency cash set aside, and I was like, all right, when, when and where to deploy this? But I had done some numbers, and I'm like, if I can sell the inventory for X amount of dollars, I can pay off most of the debt, and then potentially, if I get a new job, pay down the rest over time.

Host: And these, your big competitor, these larger guys offer you a deal and to. You said, buy all your inventory and effectively pay enough money to pay down the debt. Is that what you said?

Guest: That's what happened, yeah.

Host: Wow. And what's what of the, what of the employees?

Guest: Well, the employees, I gave them a 90 day notice. So we, we were in negotiations. December is. And we decided regardless, we're closing the business because the lease was up March 31st and I'm not, not sticking around for $25,000 a month lease. So we were already months ago in plans to relocate. But I want to do the right thing and tell everybody with 90 days notice, hey, we are liquidating the business. You may be able to get an opportunity in Utah, but many of them couldn't move for family obligations or whatever. So please go find a job. I'm here as a reference. I will talk to your, you know, whatever the hiring manager is, I'm here to help. And we got many of them, many of them roles, Some of them.

Host: What was that? What was that like when, you know, new owner comes in, as we know, common theme in this world that employees are skeptical of new owner. New owner has to earn their trust. But if things go sideways or down in your case, then they're, I mean, are they blaming you or did they already know the business was dysfunctional and in decline or what? How do they, how do they react to your saying, guys, we're, we're shuttering this business?

Guest: None of them were surprised, really.

Host: Everyone knew how, how poorly performed the performance was.

Guest: And many of them have been there for years. I mean, we're talking 7, 8, 12 year employees. So they had seen all the GMs come and go, they had seen all the bookkeepers come and go, the owner in and out. And it wasn't a surprise. They were disappointed because many of them had invested 10 years of their lives in this company. But they were also appreciative that I give them 90 days. I mean, most people would say they'd go in and the doors would be locked and they'd be like, we're done. And that's just not fair to these folks. It's not their fault. They did a great job, they worked hard, they were loyal. And I wanted to return that loyalty with as much time and resources they could to find new employment. But the skills of building their trust, that was helpful because it applied to this new role. And I had done that. It took a while for sure, but when they saw that I was intentional, that I cared, I invested in them. I obviously was organized. They felt better about the business because it was being run Better. And I was investing in them as professionals and individuals. So I had built the rapport and the trust with them, for sure. And every employee stayed until March 31st. It's pretty wild.

[1:04:02] Host: And you saw that as a sign of their kind of wanting to be loyal to the business.

Guest: I did. I mean, I, I, I felt like it was just a, a testament to the trust that we had built and their commitment to. I did the right thing for them by telling them with enough time, and they did the right thing by me, by, by knowing that if they had left, I would have been really in a tough spot. Because liquidating a space that big, cleaning it up, organizing it, moving the inventory, it would have taken. I, I, in my back of my mind, I'm, I'm trying to find, you know, consultants or movers that could, I could hire for weeks at a time to help me do this. If everybody just was like, we're out. You know, we're, we're done. This is your problem. And, and fortunately, they stayed and really helped to the bitter end.

Host: Wow. No, that's great, Dustin. Okay. And so great. Then you are hired. You're effectively acqua. Hired.

Guest: Exactly.

Host: This is kind of an acqui. Hire where they, and they, so they do take all of your inventory and you move to there in Utah. You move to Utah to take this new position. And what is the position?

Guest: It's the, the guy who I called, it's his job, which I did not expect because again, he's very well respected, very good. For personal reasons, he had to take a role that was less demanding. The organization that hired me, it's actually four companies. It's one Grant Victor, and it's vertically integrated within the ATM space. So ATMs are broken out into FI, financial institutions, banks and retail convenience stores, etc. So my previous company that I had acquired, and then this company was in the retail side of the business, and then the other side was the banking. So I had no idea where they wanted to put me. But they said, yeah, we'll make you a P and L manager. You'll be a business leader, be doing what you're doing now, just on a larger scale. And then when they offered me his role, I was really surprised. So he's taken on a role to run one of the other businesses of the four. That's a less, less demanding role so he can work on his personal stuff.

[1:06:07] Host: So how are you feeling about this outcome? How are you feeling in the moment? And then, and then we'll, you know, we're going to check in on how you're feeling about everything here at the very end. But when you. When you get this offer and look at the prospect of working for this company and doing kind of the same thing you're already doing, but at a much bigger scale, you're psyched, I assume.

Guest: I feel very fortunate. Overwhelming amount of gratitude for the board. Very seasoned business people own multiple companies. They knew exactly where I was and they knew what they were doing. They were basically bailing me out. And I knew that they knew that, and that's why I'm here, running this business as hard as I can, contributing as much as possible to return the favor, because they saved my ass.

Host: Yeah.

Guest: Yeah.

Host: And so how do you feel? I mean, it just. It's interesting, Dustin, because it's almost like, okay, so you're not owning and operating your own business, so that dream is still a little bit in your future, but you more than landed on your feet. I mean, you, You. You basically earn it. You're, I guess, in what is a great role for you. I mean, you basically got a great job out of this whole misadventure.

Guest: I did. I. I'm running a company 20 times the size of the one that I bought. So, yeah, yeah, this is a massive opportunity, professionally and personally, because I loved Denver. I love Colorado, but Colorado is very expensive, and I mean, you can't really afford to buy a house there. And I, I love the culture, but Utah is still relatively affordable. So since I moved here in April, April 1st of 24, I've bought a house, I've met a partner, and I have a job and a career and a company where it's. It's a very large organization, very good people, strong leaders that I can learn from. I have a board of directors of, as I said, serial entrepreneurs that I can learn and grow from. And there's an opportunity for me to. To elevate to the other businesses and. Or the entire organization.

Host: Yeah. Well, congratulations, Dustin. I think congratulations is in order.

Guest: Yeah, it's been a journey. A lot of. Lot of pain and heartache. Still lost money, still in debt, but I'm inching my way out. I should be debt free by end of Q3, and then I can focus on rebuilding my personal wealth. I told them that one day I would want to own my own company or run an organization that I have equity in. So again, they have other companies. So there is opportunities for me to either gain equity in this company or help them scale other companies. Because I just. I just told him I'm A business nerd. So give me the opportunity to grow something. Don't cap me. Let's both be on the same side of the table here, where when the business makes money, I make money and you make money and we're going to do great things together. And they all agree to that and they respect that. And that's really where I felt most comfortable. But it's, it's like it was a gut thing too. My, I called my mom. She was really supportive during this process to ton of emotional development she's gone through, so learned a lot from her on that side of the journey. But she, you know, before I moved and made the decision, I went home for my 40th birthday. So I'm home. I'm with some people that I really love and care about. Many of my mentors were there and they asked me, like, what's your gut tell you? And this is that. That you just can't explain it. And I said, my gut tells me that I'm going to move there, I'm going to build a life, I'm going to find a partner, I'm going to start a family. And it seems like that's where I need to be. And that's what happened within months. Can't explain that.

[1:10:03] Host: Yeah, that's wonderful, Dustin. And how does it make you feel about eta? Overall entrepreneurship through acquisition? You were really excited about it. You did it and I mean, do you think it's something you'll do again? Or maybe not. Maybe if you, you could stay at this organization and if they give you equity and you're in a growing, it's uncapped and there's no ceiling there and you can just kind of grow for the duration of your career. You don't necessarily need to be an owner.

Guest: Right.

Host: How do you feel? How do you feel about eta reflecting back on all of this?

Guest: It's a great question. I think every step in the journey prepared me for the next level. I have no regrets. And ultimately I think I would have been happy in any role where I had the opportunity to contribute at a high level and supporting others. If you asked me what my dream would be, it would be to run a much larger organization, even at a smaller minority. What I've learned about myself is I'm better at larger companies. I'm better with the systems that are available and the professionalism. We have a full C suite here. That's really helpful to be able to bounce ideas off of a CFO rather than a bookkeeper. And my bookkeeper was great. But it's just a different level of conversation because you can talk more strategy. And what I've learned about myself is that I would rather have a minority stake in a much bigger company than is I'd be able to contribute at a higher level. But I would never have been given even this opportunity to run a company of this size had I had not taken that risk. So it was necessary. I mean, even being a seasoned salesperson startup, you know, try to buy into companies, that's not enough. No one's going to give you the reins of a company of this size unless you've really run a business. That's kind of one of those things where you don't have the experience to have the job, but you can't get the job without experience.

[1:12:13] Host: Yeah.

Guest: So I literally bought my way into the experience and it happened the way it was supposed to. I mean, I. I also learned in my journey is I try to have a plan but allow for deviations in the plan. And in my past, I did not. It was like, I've got a goal, I'm heading the goal. Blinders on. I'm not letting anything to distract me from the goal. And as I've gotten older, it's like, all right, well, here's the goal. But there's this, like, windy path to get there, and there's other opportunities that could present themselves if you're open to it. Yeah, yeah.

Host: Well, it's interesting about entrepreneurship through acquisition. Eta, Dustin. Because we think of a. We think of it as a shortcut. And I don't mean that in a pejorative way. A shortcut, and only the best way shortcut to. To ownership, to being an entrepreneur, to being an owner. And while it didn't work out exactly that way for you, it ended up being a shortcut in a different way. It was a shortcut to being. To running a business of some real size, which would have taken you otherwise. Taken you years and years to get to exactly. To that role. So still a shortcut for you. It was jumped a few rings on the rungs on the corporate ladder. And how do you reflect? Because I think people listening to this will have heard you say multiple times, the vulnerability of not having known the industry, not knowing how to diligence the business. Well, because you didn't know the industry. And so much of this path is about buying businesses and industries we don't know. So that will concern people or it'll sure make them feel like it. Wow. It really is a risk to buy something in an industry. I Don't know, what would you say to them or how do you reflect on that particular detail of this story?

Guest: I would reach out to people on LinkedIn. Most of the folks that I reached out to responded to me. When I was looking at the manufacturing company, I found people who were in that industry that were competitors. And I literally just said, hey, I'm a new guy in the industry. I'm looking to buy this company. Would you be willing to have a 10 minute call? And most of them said yes. I also had a friend that worked in the industry and he was able to look at the equipment and see if it was old or it could be replaced or whatever. So I mentor kids too. I'm a big brother. And what I tell the kids I mentor is find someone that's where you want to be and ask them how they got there. It's the biggest hack in life. Find someone that's where you want to be because they know how they got. Your journey may be different, but they're going to have clues and more importantly, someone help them and the right person is going to give to you what they were given. If they don't want to help you, then they're the wrong person anyways. But if you go to them humbly and say, hey, I want to be you one day, how do I get there? I've done that multiple times and that's what led me to my growth personally and professionally. So I would reach out to people. I mean, your guests. I've reached out to many of them and I've either said, hey, thanks for sharing or I'd love to chat further. And almost all of them have gotten back to me. And I listened to other podcasts too. Patrick O', Shaughnessy, I mean, he's interviewing multi billionaires and major CEOs. I reach out to them and they've gotten back to me. It's just like, oh, yeah, it's insane. So, and I'm just, they're just people. And if you're, if you actually are legit with your request and you're not trying to, you know, beg them for money or an investment or whatever, it's just like, I just want to learn from you and I just want 10 minutes of your time. Most of them are pretty open to it because they want to give, especially as they age. I've, I've, yeah, I've been able to gain a lot of mentorship from former CEOs and, and you know, one guy, he started Bell south early at&t company and was the founding father of fax machines, pagers, and all these cell phones. Well, this guy was, like, managing 30,000 people, and then now he's retired, and no one cares. So when you go from being really important and really in demand to being a retired guy no one cares about, I. He. I light him up, you know, I tell him about my struggles, and he's like, man, I'm so jealous. I'm like, what? He's like, man, I'd love to be back in the pocket like that. I'm so jealous of where you're at. It's so awesome. So it's just like.

[1:16:32] Host: It's crazy.

Guest: That is crazy.

Host: Dustin, anything that we didn't get to. That you wanted to share?

Guest: Not really. I just. I really appreciate the time. Will you. You are awesome. Your podcast is great. It was critical in me learning the skills, but also building the confidence to do what I did. I have a happy ending. There was a long period of time where I didn't know I was going to be happy. But I just want your audience to be okay when things go wrong and just keep persevering and use that adversity to be stronger and better, because once you're in the seat, you're going to need those skills to be effective and

Host: to serve your team.

Guest: Yeah. Yeah.

Host: And. And, you know, just on a. On a tactical level, Dustin, I'm. You know, people who buy a business and. And it fails or goes the wrong way, it's probably an obvious thing to do to reach out to a competitor and kind of say, hey, let's talk about you buying me. But maybe not. So that is. That is something tactically you did that obviously directed the whole trajectory of where. Where you now are. So it's. It's also something for people to remember that they can and should do if it comes to that.

Guest: Yeah.

Host: So, Dustin, if people want to reach out to you, how do you like them to do it?

Guest: LinkedIn would be preferred.

Host: All right, Dustin, well, thank you again for coming on and sharing this. The. The hard parts, especially, as you know, we try to. We try to get stories like this on the pod to show that it's not. It doesn't always go how you want it to. Although your story is interesting. Even further interesting, because you had a, quote, failure in your acquisition, but you've landed on your feet. And then some. I mean, in some ways, it's actually quite a positive outcome. So hard to classify your story, really, Dustin. But people get a lot from it. So I appreciate you saying yes to doing this. Thank you.

[1:18:19] Guest: Will appreciate you,

Host: Sam.