[00:00:00 - 00:04:43]

Will Smith: The journey of today's guest took an unlikely turn. After about two years into ownership of his commercial fencing business, Jack Saville decided to sell the business to a large regional platform. Now his contacts at that large platform were the investors in his original acquisition and one of the teachers at his Buy a Business boot camp, Sam Rosati. Sam is a name that may be familiar to you, and he joins Jack and me for a three way conversation about how all this came to pass. Some important themes will jump out at you setting an example for your kids by buying a business, realizing your full potential, and whether owning and operating a subscale business actually does that.

How unpredictable entrepreneurship is, but that that is a feature, not a bug. The outcome for Jack was not exactly as he'd envisioned it, but nothing would have happened if he hadn't taken action. And gotten into business ownership in the first place. Here are Jack Saville and Sam Rosati, both of Perimeter Solutions Group Investing in search deals is considered very illiquid. Investors don't know when they're going to get their money out of your deal, they just know it's likely to be years.

But search doesn't have to be such an illiquid asset. This Wednesday, Andy Rougeau will present a webinar on how you searcher can provide liquidity to your investors without selling or exiting your business, which is typically considered the only way. Andy will discuss the varied but overlooked options like tender offers, put and call options, and investors selling their stakes to a secondary firm. The webinar is Liquidity Options for Search Investors and it's this coming Wednesday, September 24th at noon Eastern. Link to register for the webinar is right at the top of this episode's show notes or on the Acquiring Minds homepage.

Acquiring Minds co An overlooked topic with promising possibilities. See you Wednesday.

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. You know that one of the most common levers to pull in a target acquisition is technology updating the systems of a business that may still be running off a spreadsheet or even pen and paper. But tech is complicated with tons of solutions out there.

So choosing the right cloud platform, CRM, telephony, compliance and cybersecurity, not to mention implementing all that, is a job in itself. Acquiring Minds guest Nick Akers knows this firsthand. As a former searcher who now owns Inzo Technologies, Nick has seen the tech challenges searchers face when acquiring businesses. His team at Inzo regularly works with searchers and their acquisitions, offering a complimentary IT audit of the target company. Nick takes a personal interest in all their searcher clients, drawing from his own experience in the search phase.

Enzo dates back to 1989. So this is a company that has managed the tech for hundreds of small businesses over decades. And one last thing, no long term contracts with Enzo, a big differentiator. Check out enzotechnologies.com inzo or email Nick directly at nickzotechnologies.com and don't forget to tell him you're a searcher. Jack Saville.

Sam Rosati. Welcome to Acquiring Minds. Thanks for having me. Thanks, Will. Good to see you, man.

Good to see you, Sam. Jack, you bought a fencing business after going through SM boot camp run by Sam here. Sam, you will be familiar to many listeners. You've been on the podcast a handful of times, and among the many things that you do today, you're building PSG, a very large commercial fence business. Is it the largest in the country at this point?

[00:04:44 - 00:05:11]

Sam Rosati: I think unofficially it is. Most companies are private, so we don't know, but it would not surprise us if we are the largest commercial fencing gate business today. Great. Well, one of, if not the. So the upshot of today's story is that PSG, Sam, the business that you're building, acquired Strategic Fence, Jack, the business that you bought as a searcher.

[00:05:11 - 00:05:25]

Will Smith: It is a deliciously full circle story today. And because of that, in the spirit of full circleness, why don't you two introduce your each other. One the other and then we'll flip it. Good. Sam, I'm gonna go first.

[00:05:25 - 00:06:22]

Jack Saville: You good with that? Fine. All right, zero prep here, by the way. First and foremost, for me personally, Sam is a friend. He is a business partner.

He is in many ways a mentor. He's a great role model. Sam's just a really awesome dude and honestly is a key part of my story, which will obviously get in here today. I think probably more importantly, Sam is a father, husband to two kids. Professionally, Sam, let's see if I get this right.

Former attorney, former accountant, former searcher, former owner, operator, current operator, current m. And a current traveler with me. Anyway, that's. That's how I. That is how I frequently describe Sam. Not.

Not in as many words, but still I frequently describe him. I. I've also had to intro Sam from time to time and it's always a challenge. I never know exactly what to say. He's a man. Many backgrounds and many.

[00:06:22 - 00:06:37]

Will Smith: And many things. In search in particular, yes, so I'm blessed. I didn't even get into your current, your law firm, your SMB boot camp and all the things. So clearly I'm starting this off really strong here. So let's leave it at that.

[00:06:37 - 00:06:46]

Jack Saville: There's a lot. There's a lot to them. Yeah. Sam, your turn. Jack Saville is also a friend of mine.

[00:06:47 - 00:08:21]

Sam Rosati: He is a business partner, by the way. I'm not building PSG. Jack and I and a team, a large team of highly capable professionals around the country are building it and we're having a great time doing it. Jack is and his wife, Ashley. I'm thankful that they trusted me from back three years ago when Jack was searching.

We are business partners, we're friends, we're travel buddies, we pursue opportunities, deals together, which is fun because Jack is an operator by heart and I'm a deal deal junkie by heart. And so the yin and yang there is fantastic. Jack is an athlete, a psychotic athlete who I have this week caught in the gym at both. I didn't catch him at the gym at 5:30 in the morning, but I heard he was there. And at five in the afternoon the day before.

He is a fantastic leader of men and women. He is a fantastic business partner. He is obviously a husband and a dad. I think I mentioned the husband part, but not a dad. And at the end of the day, his, at least for this conversation, a tremendous leader of people.

Maybe that comes from your experience in the military. And Jack will probably note, hit that on that quickly. But a military veteran as well. Thank you. Appreciate that.

[00:08:21 - 00:08:40]

Jack Saville: Okay. I don't dispute any of that. Maybe the athlete part, but, you know. 5Pm and then 5am again the next morning. Jack, that is impressive.

We're getting older, Will. We're not. You know, that's how it goes. That that translates to me going to the gym less, not more, Jack, it. Is, it is my mental health reprieve as much as anything.

[00:08:40 - 00:08:56]

Will Smith: So anyway, great guys. Thank you for letting me lean on you and doing my work for me there. Jack, let's hear your some of your background. In brief, give us whatever is relevant that led you up to wanting to buy business. Sure.

[00:08:57 - 00:12:34]

Jack Saville: Super high level. Grew up, born and raised Virginia to working class mom and dad and decided at a kind of late age in high school, if you will, that I was drawn to the military. So decided to go to West Point and spent, you know, my four years there. Graduated in 2002, got some exposure to infantry soldiers during my time there and decided that being an infantry officer is what I Was made to do for my time in the army, so spent five years as a project engineer, project manager for a Richmond based commercial construction firm. Was really drawn to building things, frankly.

And it's, you know, commercial construction, now, fencing, super tangible, which has a lot of appeal to me personally. Decided to go to the corporate world and had a friend of mine that was a Capital One that recruited me to come and spent my next 10 professional years at Capital One. I decided to get my MBA during that time as well. So went to the University of Richmond and did that in the evenings. Had our second child during that time and kind of when I started to approach the age of 40, you know, I had kind of thought about searching, thought about acquiring a business.

Didn't really know what all that entailed, but you know, was. Was really drawn to it. The older I got, it was more and more apparent that if I don't go do this and do it full time, then it's frankly just never going to happen for me. So why were you drawn to it? Check.

I think for me it was like there was a lot, well, frankly a lot of things like just the. The concept of ownership has always been very important to me and I think a key part of my story is, you know, although I've worked in some phenomenal companies, like never had that really deep sense of ownership, you know, led teams, had, you know, responsibilities and scopes of work and in the corporate world. Right. But it is not true ownership. And had had some close friends that were owning and operating businesses.

And it always sounds way more sexy and appealing frankly than it is. But that was a big part of it for me, like wanting to own something, wanting to control what was within my ability to control. And so again decided to take the leap. Gave myself the kind of the quintessential two years to search at the time, kind of getting into a little bit, probably more well than we want to at this moment. But at the time realized that although I'm generally a confident person, my confidence in search honestly was a bit lacking.

So got connected with Sam, probably through Twitter, gave him a call, asked him what was in it for him in terms of why he's running this SMB boot camp. I think you had just gone through your first one, if I'm correct here, was super transparent. I appreciated the openness and honesty. What did he say? It was, look, I want to work with great people, I want to share what I've learned and frankly, I want to have the ability to invest in great deals and great people.

So for me that was the. There was no hidden agenda with Sam. I think Sam, that's probably a defining trait of yours. There's no real hidden agendas to Sam. And as again, as someone who appreciates openness and honesty like that resonated with me.

And honestly it was three days to go meet some new people in my new world of search. So it's kind of a no brainer for me to go do that. And honestly while I was there I think I had maybe submitted two or three LOI. Maybe two LOIs at the time and literally built my entire my future deal team from that event. So my attorney team to my lender to my insurance provider, like literally.

Sam does a great job, but I'm not plugging your boot camp here Sam. Right. But for me that was very, very important to kind of my search journey and obviously it's led us to where we are today too. So I'll pause there, will feel free to probe on any of that. So thanks.

[00:12:34 - 00:13:13]

Sam Rosati: Can I ask you a question that Jack, I think you're the one that says this and I don't want you to forget to tell it. Yeah, that part of it was, you know, with the kids at the age your kids are at, being able to show them through your action that you know, ownership and taking the bull by the horns in your life is something you can do at any age and you wanted to show them that through your action and not just through words. That yeah, for sure. And honestly like what I will tell people frequently is I'm a big fan of that. We as parents are always setting an example for our children and that example is a good example or it's a bad example, but it is an example.

[00:13:13 - 00:16:23]

Jack Saville: And for me personally, you know, again great corporate jobs here. Right. Let's had the opportunity to work with and interact and lead phenomenal people, many who I'm still very, very close with. But I just personally was not proud of what I was doing on a day to day basis. So I'd come home, my wife and I would cook dinner, I'd go to like whatever I was doing in the evenings.

But very, very rarely would I talk about work. And either it was, it was neither good nor bad. Like I just didn't talk about it because honestly I wasn't very proud of what I was doing and had this realization as again as I approached 40 and you know, my daughter's 19 now, my son is 16 and this was call it five years ago. So kind of those early teenage years for them that like I wasn't living up to, like, who I wanted to be, honestly, as a father, and decided again, it's kind of now or never. And again, a key driver for me has always been, like, who am I?

Who am I as an example for my children? Sam. We talk about it even, like, earlier, just this week, when we were together. And I think, Sam, one of the things that you tell people about PSG is, like, for our kids to look back and say, you know, my dad, my dad did that. Right.

And I think that, like, that is an important motivator for me. It's also an important motivator of, like, look, I'm no better or worse than anybody else, frankly, like, relatively smart people here, right? But, like, my dad did that, and I can go do it, too. So that's something that I want my kids, you know, as we all start to look at our legacy here, right? Like, I want for my kids to look at their father and say, he set the right example.

Anything's possible. Just go do it. That was a awesome. Why? Let me just press on you a little bit.

Sure. What about being a small business owner or business owner builder is so worthy of the admiration of teenagers. Like, you were. You were taking a. We are taking a massive risk with buying a business.

And I think, you know, I think you have an appreciation for it as you're considering it. You're having appreciation for it as you're starting to go down that path. You certainly don't realize it until you're. Honestly, it's probably too late. When you're in the middle of it, is how big that risk, frankly, can be.

So I think part of it is a willingness to take risk. It is a willingness to say that this is something. And for me, owning and operating a business, regardless of how I mentally got there, that was something that my kids would see me read the books or listen to the podcast, whatever was going on at the time, and they would ask the question, why are we listening to this again? Again? Honestly, some of them were your probably early.

Your early podcast will. And it was like, do I really have to listen to this guy again? Like, why are we listening to this little car ride? Right? And it's like, so then I would start to talk about, this is something that I'm strongly considering, or this is a dream of mine, or this is something that I want to go do.

So it was. I think for me, it was like, the example that I'm trying to set. It's less about going and owning and operating a small business. It is Having a big dream, going and pursuing it know and doing it with conviction and like frankly and willingness to take those risks too. So it's attributable to small business ownership.

It's attributable to you want to go back to school and get a master's PhD, whatever it is. Like go do the things that are hard. So yeah, Sam, give us a little bit more on. On SM Boot Camp. So when Jack came in, it was one of the very early cohorts that would have been 22.

[00:16:23 - 00:17:48]

Sam Rosati: May 22nd. Yeah, May 22nd, that's right, 2222. Which in hindsight was the second cohort. And so obviously now looking back, I had no idea what I was doing, just like Jack had no idea what he was doing in search. So it was a perfect match.

I remember where he sat. We were at an old venue that we don't use any longer. You don't use that venue anymore. Thought was pretty. We don't.

Yeah, it was good but it wasn't great. So I remember where he sat and I always generally remember the people that stand out in one way or another. Right. And generally what that means is they have like a, an aggression to them or a figure it outness that there's just nothing that's going to stop them from getting in the seat. So I know this ended up with hopefully in a absolutely fantastic outcome.

We're not there yet because we're still building together. It's going to happen though. It is going to happen. We have strong convictions about this. Yes.

But I will never forget that. Obviously. So good memories. The team at Aspen HR recently published a short white paper targeted at searchers Entitled A New CEO's Guide to Human Resources. It lays out the key items you should be thinking about as you transition into CEO and owner of the business you bought.

[00:17:49 - 00:18:44]

Will Smith: The link to download it is in the show notes. Aspen is a professional employer organization or PEO run by a searcher for searchers. Search fund veteran Mark Sinatra runs the company which provides HR compliance, flawless payroll, Fortune 500 caliber benefits and HR due diligence support for your acquisition, all for. A fraction of the cost. Go to aspenhr.com or contact Mark directly.

At mark aspenhr.com what is SM Boot Camp by the way? Is it SMB Boot Camp or SM Boot Camp? That's a great question. We'll go with one B. SM Boot Camp. Yeah.

Okay. It what does it look like today? I know that you launched an online component to it or version of it. Take give us a picture of what it looks like today, three plus years later. Yeah.

[00:18:44 - 00:21:44]

Sam Rosati: So just over four years from our first cohort, which was in July of 2021. Ironically, one month later, we acquired a business called West Florida Fence and that was the start of PSG. So it's a, it's a fond period of time for me that, that stretch summer of 2021, uh, SM boot camp now has had, I'm gonna get this wrong. It's 17 cohorts. We've had over 300 alumni come through really.

So I have seen a lot, I have the benefit of having seen a lot. Very fortunate to see that the reasons for doing it are still the same. I have fun. I feel like I get to share all of the lessons with people who have a chance to change their life the way ETA did for me. ETA kind of took me out of a really tough career spot I was in.

So I still get to pay it forward. I still get to invest in great people. I think I just invested in a, a pair of alumni that came to boot camp together or separately partnered and then went, went home, acquired a business and I'm fortunate enough to be on their cap table. So that's a perfect example. And then I have not done this as much, but I have had the chance to meet people who don't end up buying, but they end up wanting to partner or work together in one form or another.

And Jack ended up being a great story of kind of both of those things. But boot camp we run live. That's still our core, most popular program is the three day live in person in Tampa. Cohorts of 20 people. We bring our deal team.

SM Bootcamp has a team of five now. So it's a real group of professionals. Investment banking, private equity. Several of us have bought small businesses. And then now that our alumni is so big or alumni base, we bring back people who have come through, they've acquired and they're in the seat and some are doing great, some are struggling and everything in between.

But we give everybody the tactical playbook. And I think if there's one thing that we've seen is generally the people that come through are a little older. They're not the traditional search fund, 25 to 28 year old post MBA. They have had a longer career, they're a little older, they want to self fund, buy something maybe locally. And the reality is they buy a bigger business.

Like Jack's business that he bought was a bigger than usual business for, for a self funded searcher. And that tends to be what our alumni Buy. Great. Well, for people who want Sam's full story, the history of Boot and his history in fence, and even before that, how he got into eta, we did a comprehensive walk through Sam's. Sam's entrepreneurial life probably about a year ago at this point.

[00:21:44 - 00:22:05]

Will Smith: Sam, great episode. Taking us right up basically to the. Pretty much to the present. I've never had a colonoscopy, but that's what it felt like. I'm glad my guest have such an enjoyable experience.

By the way, speaking of age, Sam, get on it. Yeah, that's right. You're. You're approaching that age, buddy. Yeah, almost.

[00:22:06 - 00:24:47]

Jack Saville: Almost. All right, guys. So, Jack, tell us what your search look like. Give us a couple of the. Of the kind of parameters that you had, and then I want to hear about strategic fence and why you liked it.

Sure. Yeah. So for me, I was going to operate the business. Sam, you call it the big three little two. I'm probably mixing that up.

Let's see if I can remember them all. For me, I was going to operate the business. I was going to leverage the SBA for the debt portion of that deal. And geographically, for me, they. My.

My search or geographical search kind of evolved over time. When I mentioned I kind of had passively search when I was doing corporate stuff, realized that in order to be successful that I needed to expand my geography. So I was searching from Virginia down to Florida. Texas was a market that I was also looking in, just given the sheer size of that market. And I've got some very close friends and family that live there.

And because I used to live in Colorado, I was looking in Colorado as well. So you were prepared to move to Texas or Colorado from. We were same. Say more about that with your family. What was that going to look like?

Yeah, so my wife works remotely. My kids are adventurous, supportive kids. Right. And for us, you know, the. The quintessential home is where your heart is.

Right. So my family is in Virginia. My wife's family is in Georgia. Had, like, both locations would have been okay for us too, like, if I had found something in Virginia, you know, and I looked. I think I submitted an LOI on at least one, if not two businesses that were effectively in my backyard.

But again, we were just open to a broader area. Like, this kind of goes into the spirit of, you know, taking a risk, you know, the spirit of adventure. And those were things like we were bought in, like, not just financially, but bought into. This is going to likely mean a move. Right.

And you know, to kind of jump ahead to strategic fence. I remember vividly, like had met with the owners over the phone or over a zoom call. And it's obviously, you know, Breen Ridge, Colorado is a fantastic resort community in the wintertime and the summertime. So we decided to make a family vacation out of it. Took my kids there in the summer of 22, literally probably a month or two, honestly, after I'd been in Tampa.

Right. Sam was. Remind me to come back, Will. Sam was super helpful in the LOI negotiation. We were there and you know, again, it's a small town, right.

But both of my kids were like, yeah, this is pretty kickass town. Like tons of stuff to do recreationally. Like, it's just, it's, it's a great town. So that was a key part of, you know, kind of getting the buy in for my kids is like physically taking there. And because again, it's a vacation town, it's pretty, pretty easy destination to, to make a, make a trip out of.

[00:24:47 - 00:25:29]

Will Smith: That strikes me as unusual, Sam, among searchers, that they, if they have a family rooted somewhere that they're willing to move the entire family. It's, it's rare enough among single or childless people, let alone people with a family of four. Agree from what you see, it is. Absolutely the exception among self funded ETA buyers and especially among our alumni. For sure.

Yeah. Most of us are tied, especially later in life, to a specific area. One thing that I will add, Will, is like, geography is super important. You know, from. There's things that my wife and kids and I like to do together.

[00:25:29 - 00:26:06]

Jack Saville: Again, that's like a lot of times it's just outdoor stuff, you know, so there were some markets that like, weren't on the list because frankly, I just didn't want to live there or a town was too small and I didn't want to live there. And again, Breckenridge is kind of crossing the line, right, because it's a super small town. But you know, again, somebody who had just turned 40 at the time, like there were places like simply would not have been on my list or it could have been a fantastic deal or fantastic opportunity. But if it was in a town that I didn't want to move to, like, it just wouldn't have been on my list. So we were, you know, sure.

We had some discretion, of course, as well. So. Yeah. Yeah. Well, you called your kids adventurous.

[00:26:06 - 00:26:21]

Will Smith: It sounds like the whole culture of the family is adventure. So which we try to. We try. Yeah. That's great.

That's great. Okay, so let's get into Strategic fence. You find it where, how and what. Did you like about it? Why don't you lay the.

[00:26:22 - 00:26:36]

Sam Rosati: The ground work or whatever the appropriate term is for. So you, you. We met in May of 2022. Yep. And then timeline always helps people kind of when did you find the opportunity and then when did we close?

[00:26:36 - 00:30:44]

Jack Saville: Yeah, I probably found it. I mean it was very quickly after that. It was in maybe Juneish, something like that. Because again, I remember our relationship. It was super kind of new fresh at that time too.

Right. So Sam and I are frankly building trust. It spent three days together and now I'm calling them to ask about negotiating an loi. Right. So like a ton of trust that I think we built in each other quite honestly in a very, very short amount of time.

So that was June or July time frame. Again, met with the sellers in Breckenridge after having some phone calls. This was through a. It was through biz by sell is where I found the listing. I'll.

I'll add. One of the things I really did not enjoy during my. My search phase was generating deal flow. And it went so far as I got connected actually with a member of our boot camp that Sam may remember, a gentleman by the name of Joe. And he was working with some offshore partners at the time in Pakistan.

I was curious. You start to hear a lot of us hear offshore partners and all the things that. That can potentially afford one, both in search and operations. So I was intrigued. Joe connected me with this offshore partner.

They helped generate deal flow for me. They were, you know, good, bad or indifferent. They were signing NDAs on my behalf. Right. Literally just to crank through deal flow and putting, you know, once a week.

I bet you they probably looked at 50 to 60 deals and would put, you know, maybe five to six in front of me that kind of met my search criteria. So they were really helpful in kind of one generating deal flow, but then also just kind of weeding through that noise on my behalf. The gal that was working with me then, we're still working together at PSG, whatever, two and a half, three years later. And Jack, was she doing off market or just on market? Screening everything that was on market.

So one of the things that Sam, back to your bootcamp plug here. Right? Like one of the things that Sam preaches in my opinion is like you can go the proprietary search route, nothing wrong with it. Right. But like it is a big hurdle to convince a seller who is not intending to sell.

Like, and you're a self funded searcher with limited resources and Limited time. Like if you want a higher chance of success than to do that quickly, go for the deals that are already on market, you know, and for me that was, you know, Biz Buy Sell was a big source of that. We of course had all the, we were, you know, scouring the, the listings for the small business brokers in the markets that we were into, but they were effectively all, you know, publicly listed. That could have just been through a newsletter or a website. But Biz Buy Sell was a key part of that.

Yeah. And so your team in Pakistan was basically doing all the outreach, NDA signing, all the blocking and tackling of basically just. Yeah, working, basically going through all of that to surface to you deals with the teasers and the sims that you, they thought you would meet your criteria and you'd want to look at. Yeah. Quick side note, like, my corporate background was in supply chain and procurement.

I'm a big fan of leveraging third parties to help. We can't do all things and can't be great at all things. And generating deal flow was not something that I was great at. It's like this is what they do. Why not, why not go down that path in a really low risk, low cost way?

So that was how, again, that was my approach, you know, after some trial and error to generate that deal flow. So. And no, we're not sharing the name of that resource because we want to hog it for ourselves. Yeah, they've become a key partner for us. So.

Yeah. And do you think that this person, of course you're going to say yes. Do you think that this person is exceptional or that similar people like her or him could be found on upwork or elsewhere? You know, I actually, I personally tried upwork nowhere near the capabilities of the resources that we're working with at our offshore partner now. From English proficiency, verbal written analytical skills, excel skills like work ethic through the roof, like, fantastic.

I mean the people that we work with in many respects, you know, they're not as close to a friend as Sam is. And as an example here. Right. But like we send each other birthday gifts like, like, effectively have become kind of business friends in that regard. They just happen to live on the other side of the world and honestly, a little bit younger than we are, but hungry go getter, like want us to succeed just as we want them to succeed.

[00:30:44 - 00:31:16]

Will Smith: Jack, give us some sense of the, the financial parameters, the size that you were looking at. Yeah. So for me, my parameters were effectively call it 750 to a million and a half in SDE revenues, whatever those may be, but margins in like the 15 to 20% range. And then so for Strategic Fence, you know, it was kind of that, it was very cleanly in that range. I'll just say like to not overshare numbers here because they're still a operating part of our business, but very cleanly within that range.

[00:31:16 - 00:32:38]

Jack Saville: Really healthy margins. It was a husband and wife seller team, super high integrity, just good people and that's, I'm sure others have come on your podcast and just talk about how important the seller is. Right. So they, they very much fit that criteria for me. We invested a lot in one another initially.

Like they hold a seller note. Right. So just that that partnership and that relationship was something that I weighed or weighted very heavily as well. And it must have been great to be able to diligent, have Sam as a diligence resource or informal though it might have been. But did you didn't go looking for a fencing business?

I did not, no. I was not opposed to, to construction though because again I had when I left the army and I did a little bit of construction stuff in high school. Right. Like the normal summer jobs that many of us have. But again I had been in commercial construction for almost five years, give or take and so was very comfortable with the construction process.

Right. So again for me like that was an industry that may not have been the top of my list frankly, but like it was something that I very seriously considered. And when you're trying to generate deal flow, you see a lot of construction opportunities, a lot of project based construction opportunities. So, so I was comfortable with that. There's of course pros and cons to that model.

Right. In terms of revenue and all and earnings and cash flow predictability. Right. But like I was comfortable with that model just because I'd been in it before. So.

[00:32:38 - 00:33:28]

Will Smith: Yeah. And say more about either of you maybe. Sam, first the how somebody can get comfortable with a construction based business. Because the cliche is that those are really challenging businesses. They're working capital challenge, there's operational complexity and on and on and on.

And yet I've so many guests have bought and thrived in such businesses. Well, let's not forget they're still challenging because they can be cyclical. That's really the, the, the fundamental question, right. Construction, the project revenue means that you don't have any repeating revenue so that there's a chance that it can be somewhat discretionary or turned off when times are tough. But the commercial construction business and the residential construction business are not the same.

[00:33:28 - 00:34:28]

Sam Rosati: So you have to ask yourself what you're in and are the end markets that you serve are the industries of your customers, are they the kinds of industries that will continue to, to buy from you? In our case for PSG or strategic, will they, will they do construction projects? Are your, the industries stable? Are they, you know, industrial warehouse, energy data centers, all the things that should continue to see growth in good times and bad. And if they are, maybe you're not quite so subject to the swings of the economy.

So I think you have to do a lot deeper digging than people are used to doing. You can't just read the headlines. Yeah. That doesn't make them easy. Right.

Construction businesses are big and they have big working capital balances and sometimes labor can be tough and you name it. So that's not easy. It's not. I agree, I agree. And I also kind of back to strategic fence a little bit here too.

[00:34:28 - 00:36:20]

Jack Saville: Will for me, you know, absent of like high integrity sellers, a market that I wanted to live in financially, like ticked all the right boxes and there's some downsides which I'll, I'll touch on too. Like there, there was like revenue diversity, honestly, which I really appreciated. So we, we did and still do commercial fencing, a little bit of residential fencing, temporary fencing, which has a rental, you know, stream that's associated with it, and then a couple of these other small, little ancillary things. Right. And I also remember when I met the seller, one of the sellers for the first time, he's an Australian gentleman, and his comment to me when I asked him kind of why he got into this industry as well, and it was something with, you know, through an Australian accent, of course.

Right. But it was like, Jack, I'll tell you, fencing's the second oldest profession in the world. I had to think about like what he was lying there. But the reality is, and you know, Sam touched on it. Right.

Like in good times you want to secure your things because you've perhaps just bought a bunch or you've just built a new home or a new commercial facility. Right. And in bad times you want to secure your things. Right. So it's, there is some cyclicality with the construction industry.

You know, for me, I also was as much betting on the Colorado resort market because that's where the majority of our work is today. So there again, it's not a perfect business by any stretch of the imagination. I learned that firsthand. We're still learning it. Right.

But it was, it ticked a ton of boxes for me. Would love to hear a little bit more about being in a resort town, I'll just plug a recent episode where a couple of searchers bought in Aspen, which was actually their hometown, but they had left and lived on the coasts and then wanted to get back. And in fact, kind of their whole thesis then surrounded buying businesses in their hometown of Aspen. But one of the features of Aspen, at least, and probably in many of these towns, is that there's kind of a geographic moat. They bought a.

[00:36:20 - 00:36:51]

Will Smith: They bought an auto repair shop, and they're. It wasn't another auto repair shop for 40 minutes up the road in Aspen. And so I wonder, is that. Is that a kind of a similar dynamic that you saw in Breck in your own business or in other businesses where there's a premium, you can enjoy maybe fatter margins? Because there just aren't.

Because it's a. The supply of what you offer is constrained. Yeah. And it is like, I don't want to say that we had no competition, but we had minimal competition. We hit that.

[00:36:51 - 00:39:26]

Jack Saville: Denver's, you know, 90 minutes away. Right. So. And. And Denver's a thriving market that we're actively pursuing with PSG now too.

Right. So. But contractors that would want to drive up the hill, you know, in i70, if you've ever been on an i70, it's not a fun drive. Right. So like, they have to want to go up there.

Right. So for us, we felt like. I felt like we had a really kind of a stronghold on that market. Honestly, you fast forward 12 months into my operating, three of my crew leaders left, and two of them started to compete with me. Right.

So like, they probably saw the opportunity as well. One of them. We've got a great relationship and we have a subcontractor agreement in place now. Right. So.

But. But it does speak to perhaps, like, your guests that are in Aspen. It's like if you do really well, if you treat your customers right, you gotta always have to price your work fairly, in my opinion. Right. But, like, sure, you do all the right things and good things can happen and you overcome the.

The seasonality that's associated with putting fence in the ground, you know, in a snowy resort community or dealing with the labor constraints and frankly, a labor pool that, like, is also living in a resort community for a similar reason that perhaps brought you there, you know, so a lot of times their ambitions and motivations are not terribly high, absent of wanting to work and, you know, kind of have the lifestyle, honestly, that they want to have, too. So again, there are pros and cons to everything in life, you know. And Jack, what about the obvious con that, that, that it's a smaller market so you can only grow but so big. Yeah. If you choose to stay in that market.

So for me, where I, you know, part of my initial thesis was, you know, acquire strategic fence. If we can grow outside of our market, I. E. Denver or other resort communities. We weren't doing a bunch of work in Aspen and Steamboat Springs at the time. We're starting to do more and more of that, which is fantastic. Like.

But there were geographical places that met or had very similar criteria that we could also expand into. Right. That weren't being served by multiple fence companies. So that was part of it. It was, you know, do we potentially look at more rental streams?

You know, are we getting into dumpsters or porta Potties or event type things? Do we do temporary fence for events today? Right. But like do we start to go more down that path as well? And I think the third one for me was, you know, or alternatively, like I can look at other comparable types of business in these resort communities that are adjacent to Breckenridge and frankly just by their businesses.

Right. And you start to put teams in place and all that. So again there, there were a couple paths that I pers. That I at least considered honestly PSG like wasn't even on my radar. Like it was and it wasn't right as.

As an option. And here I stand at I guess option number four today. So.

[00:39:28 - 00:40:09]

Will Smith: Sam, you had mentioned that the strategic fence that Jack bought was a little bit bigger than is common for self funded searchers. I did hear Jack say that the, you know, target range was 750 to a million and a half of earnings. And this was, you know, kind of in that direction. So that actually feels to me, Sam, like the ideal. That's what, that's what we always say is the ideal for a self funded searcher.

750 to a million, call it.

But of course guest after guest after guest often doesn't. Isn't able to actually get that. Do you agree that that's the ideal, but that basically it's actually rare for a searcher to actually get their hands on it? Yeah, look, it's just harder. Right.

[00:40:09 - 00:41:35]

Sam Rosati: So. So the businesses that self funded searchers target are also the targets of all sorts of buyers. Private equity backed platforms that already exist. They are typically like why do we all want size and an acquisition? Because it's a proxy for maturity of a business.

It's really simple. It means a lot of things but that's like the distillation of it so. And also like I just want to say we're trying to be respectful of our partners in not sharing too many details. So that's why we're not giving you like the numbers. I know that's, that's juicy for many people.

Suffice it to say strategic is and was in a really nice size range for a self funded searcher and that is rare. Thankfully the boot camp alumni have found a way to get a hold of slightly larger businesses and as a result mostly what they're buying are more mature companies. But because of the competition in the SMB space now a lot of people are having being forced to buy things that are smaller, you know, 3, 4, 500,000 of SDE. And I think it's worth saying what Jack bought, what I've bought in the past even when bigger are still a job. When you buy a small business you are buying a job, no doubt.

[00:41:35 - 00:42:04]

Jack Saville: Yep. So even if you have more than a million of sde, it doesn't matter. You're still buying a job just like your friend is who buys 400k of Steven. If you ask owners in the ETA and search community which insurance broker provides highest quality work, great outcomes and has a practice dedicated to searchers and acquisition entrepreneurs, one name comes up again and again. Oberle.

[00:42:04 - 00:43:22]

Will Smith: Oberle Risk Strategies has worked with hundreds of searchers over nearly a decade and is in fact led by by a two time successful searcher, August Felker. Which makes Oberle a specialty insurance brokerage for searchers by a former searcher. And if you've got a business under loi, Oberle will provide complimentary due diligence on that business's insurance and benefits program. An easy no risk way to get. To know August and the team at.

Oberle to take advantage. Check out oberle-risk.com that's O B E R L E- risk.com link in the notes. So let's hear about the acquisition itself. You mentioned Sam and him helping you work through the LOI negotiation. Sam's own partner features here.

So tell us that story and what you would share. Yeah, I will say one of the key parts honestly too of the successful transaction. The sellers hired a phenomenal business broker. He was a guy local to Breckenridge, knew the market had been trying to work with the sellers and selling their business because they were at retirement age like for many many years. Just a very level headed like I knew that he wasn't working for me but he very Much met the definition if he was working for the transaction.

[00:43:22 - 00:44:05]

Jack Saville: So I give him a ton of credit in that regard. My first offer was one that I felt was fair. It was inclusive of working capital. You know, fast forward through probably four rounds of negotiation, like working capital became the issue, like of us potentially getting the deal done. And so through conversations with Sam, and I was also trying to minimize some of the downside risk as well.

So again, through those conversations with Sam, we structured a forgivable seller note. I effectively offered full price. I offered them like their asking, but again through a pretty healthy seller note and structuring it in a forgivable fashion. Like that's how I kind of mentally bridge that, that gap, at least from a risk standpoint. And then can we hear more about the mechanics of that?

[00:44:05 - 00:44:29]

Will Smith: Maybe, maybe Jack, feel free. Or maybe Sam, since you probably teach this at boot, talk to us about how a forgivable seller note works, how it mitigates risk, and particularly in this deal, since we got an actual example we can use. Yeah, I'll do my best and say I obviously chime in here too, right. But so of my total deal call or of my. Of the total purchase, purchase price, 20% was through a seller note.

[00:44:29 - 00:46:36]

Jack Saville: And the way that we agreed to do to structure it was the first two years were a interest only, like no principal for the first two years. So that really helped with my initial cash flow for those first two years. We also structured it in a way where there was essentially a floor. So we looked at the last year's revenue and said that if we don't hit that same revenue number, I didn't tie it to earnings or gross margin or anything like that. Like we tied it to revenue because we felt like that was fair, like that was within my control and I couldn't manipulate revenue.

Right. If we didn't hit that previous year's revenue kind of pre transaction, then that year's principal payment would essentially be declined by however much we didn't hit that number by. So we have a nice little table that's in our seller note and all the things, right. So in a bad year, right, Like I'm potentially not paying back that year's principal. And it was over the course of seven years again, first two years being interest only, so no principal.

So a five year amortization, it was whatever the prevailing interest rate was at the time, you know, very. A lot lower frankly than it is today. I have to do quarterly, you know, send quarterly financials to them just to show them that ongoing health of the business. They're still the landlord as well. So there's ongoing relationship that.

That remains there as well. But again, that's how we structured it. I think they got comfortable because their. Their asking price was met. Obviously, a lot of it had to do with the confidence in me and my ability to successfully operate that business.

So I don't. I don't. I didn't take that for granted at all. Like, I very much knew that I was selling myself to them. But anyway, that's.

That's kind of how we like, that was the key part of the deal, absent of kind of working through the working capital, you know. So, Sam, do you recommend your students use a use forgivability in the seller note by default right out of the gate, or only as if there's a risk that needs to be mitigated? Well, I mean, look, every deal's different, but the answer is, in today's market, it's, you know, summer, late summer of 2025, it's still a seller's market. Sellers expectations, generally speaking, are elevated. So what are they not doing?

[00:46:36 - 00:47:30]

Sam Rosati: They're not giving huge price concessions. So all of us buyers are still, you know, SMB buyers are feeling like we're getting pressed to pay maximum valuation. And so it is one of the few tools in the toolbox. Generally, earnouts are not allowed in SBA land. So it is the only tool in the toolbox to bridge evaluation gap.

So it feels like an earnout even though a forgivable note is not. But there it is, not an easy thing to negotiate. So there are deal implications to going down this road. So what I would say, long. Long story short is I wouldn't start with one, but if you end up in a valuation gap scenario, absolutely.

Pull it out and use it. Jack, can we talk about how Sam and Sam's partner ended up on your cap table? Sure. So we got officially, like, I remember the day vividly. I was sitting in my truck.

[00:47:30 - 00:47:49]

Jack Saville: The broker called me, and he's like, they just signed. And I'm like, again, this is through round four or five of LOI negotiations. And I remember saying, like, we need to. Paul, let's pause and celebrate this. And he's like, whatever.

We got to keep, we got to keep going. Right? Like, this was a moment in time where we should at least stop and celebrate for a brief moment here. Right. Because it was a lot of work to get to that point.

[00:47:49 - 00:48:19]

Sam Rosati: How do we get on your cap table? For me, my wife and I had saved, of course, saved some money like most people, we were prepared obviously to do the, the, you know, our contribution from an equity standpoint. But it was also important for me to find that kind of value added partner, right. Someone who could come in, sit on my cap table, but also potentially sit on my board. And I really wanted to limit that to, at the time to two to three people, frankly, had conversations with some really close friends, actually went to Sam initially.

[00:48:19 - 00:50:32]

Jack Saville: And Sam, I think respectfully declined or kind of kicked the can because of the, the. The West Florida fence and PSG pending or it had just closed transaction. But Sam said, look, I want, I want to connect you with my business partner, his business partner, and now my business partners gentleman by the name of Chris flew down to meet Chris in Tampa a couple days later. And we spent the better part of the day kind of going through who I was as a person, who I wanted to be as an operator, what my plans were for the business. And honestly, I got Chris's pitch on who he was as well.

And Chris used to be. Used to run a pretty large fence distribution business. So here was someone that again, had partnered with a guy that I just met that I'm starting to build a lot of trust and respect for. You know, in Sam, in this case, it's also a guy who'd been there, done that. Like, Kristen's got some gray hair, right?

He was also a guy that like, took me for who I am, like, as a person, as a future operator. Like, there was a lot of openness that we had in that first conversation. And Chris's comment to me literally at breakfast as we finished up four hours, finished up breakfast four hours later, was, jack, I will be. We PSG. Chris will be your investor here.

My only stipulation is that we are your only investor. So for me, it was okay. Well, I don't, maybe I don't get the benefit necessarily of other people on my cap table or sitting perhaps on my board, but I've got a pretty awesome partner here, both in Chris as an individual and then kind of PSG as a whole. I'll also add, like, as I was thinking about raising that money and I gave some thought to this, but I don't give myself too much credit because I wasn't this. I didn't have the foresight potentially of, you know, sitting in the seat today, you know, partnering up with, with PSG necessarily in this capacity, but by getting exposed to PSG for them, learning me like that was also a potential option that, that we saw as if this doesn't work out or I want to change paths, whatever the case is.

Like, PSG potentially could have been an option for me. So that was also a side benefit because I frankly told some other very, very close friends, you know, thanks, but no thanks for the money that you want to invest in this business, which is also a difficult conversation. Right. So again, PSG was just a great partner for me. Again, now is a continued partner, just in a little bit of a different capacity.

[00:50:32 - 00:50:40]

Will Smith: So. So you saw optionality in working with PSG for sure. Yep. It create. It created that optionality for me both as an operator and kind of post.

[00:50:40 - 00:50:55]

Jack Saville: Post operations too. So. And. And the deal being that they would be the only check on your. Into your deal.

Yep. Or at least from a fence company or at all. And honestly like to give. To give. Chris, what does that mean?

[00:50:55 - 00:51:07]

Will Smith: How, how you hearing that? Do you do. Do you interpret that? I interpreted, and I think Chris was pretty open and honest in this regard. Was like, I'm going to sit on your board with, frankly, me and my wife as a, as a share.

[00:51:07 - 00:51:37]

Jack Saville: My wife's a shareholder of the business because of the personal guarantee and we both had to sign it. Like, I don't think Chris wanted to sit on the board with anybody else. You know, and it's like, in retrospect, I fully get and appreciate that. Right. Like, he had, you know, effectively an equal voice to me and my wife, not necessarily by percentage.

Right. But that voice in that in those quarterly board meetings or the guy that I'm calling and having a bad day with, it's like, I'm not calling three people, I'm calling Chris. So, Sam, you're smiling. Anything to add to all this? No.

[00:51:37 - 00:52:39]

Sam Rosati: Look, I think we felt fortunate, so when you called me, I was like, thrilled to help you. But I, I think it's worth saying that you can have the grandest plans in the world and you have no idea how things are going to shake out. Right. You just have to make your best guess. And I think we both had ideas that while the partnership was starting very fairly modestly, like Jack and Ashley had the lion's share of the ownership, the lion's share of the risk.

We were a single, modest check in his cap table. We saw it equally as multiple ways to win. Only one of those is what actually happened, which was to end up kind of, I guess, acquiring Strategic, but more importantly, you know, getting Jack as a partner. There were a lot of ways to win from this, from our side. And same for Jack.

He was smart to think, like, I need to Know ultimately who could buy this business for me and to think it could be us potentially was a smart thing to do. Yep. Well, I'll, I mean I'll share. We can cut this if you want. Right.

[00:52:39 - 00:53:37]

Jack Saville: But I'll share that like for the terms that give credit to the boot camp here. Right. Like the terms that I went to PSG with with kind of in my SIM that I, that I went to market with quote unquote, like it was 2x step up on your money. Here's your, here's your dividend. Like you know, we.

For me I kept, I had of the total equity split. I did 80, 20. So 80% common. 20% preface. 80% common was all me and my wife and the 20% pref was split between me and PSG based on our capital contribution.

So again it felt, I mean it felt like a big check is the one that they wrote me. Like it was. And it wasn't to be honest. Right. But it was, I felt like I was giving them market terms.

They were like very active, Chris in particular very active in partnering with me on that. So again, if we were still in that position today, I think financially it would have been a great move for you. It would have been a great move for me as well. Just happen to evolve into what we are today, so. Exactly.

[00:53:37 - 00:54:02]

Will Smith: Great. Chad, thank you for all that and all that detail. Really, really good, good stuff to hear. So let's hear from your tenure as owner operator. You move, you move out there with the entire family from so Virginia to Colorado.

What does that look like? And then, and then I'll go. So we closed in January of 23. So we're again school age kids. My daughter was in her junior year and my son was in his eighth grade.

[00:54:02 - 00:57:53]

Jack Saville: So last year of middle school I knew that at a minimum the first six months were going to be pretty, pretty challenging. So I decided to move out to Breckenridge, rented a house in, in an adjacent town, moved to Breckenridge by myself and started operate the business. I was traveling at least. You know, I would go back to Virginia once a month and my wife and kids were kind of out to Colorado once a month as well. So every, every probably three weeks is really what it averaged out to be.

Every three weeks we'd see each other. In hindsight, three weeks away from your family. Month after month after month after month after month, like gets pretty old as well. School, school year finished up, they came out and spent the summer with me and then we gave both of my children honestly the option of where do you want to spend the next year of school? So my daughter was going into her senior year of high school.

She was in a fast, fantastic school in Virginia. She elected to stay in Virginia. So my wife stayed back with her. And my son said, kind of in that spirit of adventure, like no, let's, let's move out to Breckenridge and again, I'll go live with dad, right? Again.

In hindsight, I love both of my children tremendously as we all do as three fathers that are sitting on this call here. But like the relationship that I built with my son with that time that we had out there together from skiing two days a week, right? Saturday and Sunday we're skiing every week. Summertime rolls around, we're mountain biking two days a week, like taking him to school, picking him up from practice, things like that. Like missing our wife and sister, you know, and his mom.

Like the relationship that he and I have through that time. Even if this thing complete. I was telling this to a guy last night at happy hour, like if this thing completely failed, right? And I lose my house and all the things that we all tell ourselves in those really, really bad days, without question, I would trade it all for the relationship that I now have with my son. I will never get that time back.

He's one of my best friends. And it's tough to say that as a first 16 year old son, right? You obviously still have a father son relationship, right? But like the relationship that he and I have built, again, I wouldn't trade it for anything. So.

And love my daughter if she happens to listen this, she fully knows that as well. But just it is a, it is a different relationship that he and I have. And honestly my, my wife will tell this too. The relationship that she built with our daughter through this geographical separation. Again, it's really, really hard on a marriage being apart for that period of time.

But she wouldn't trade that, I don't think as well. So. And, and Jack was this like a we'll take it one year at a time thing or. I mean our plans were for all of us to be together. And I will, I will add without speaking in ill of the school system in the Breckenridge area.

We did not have a great educational experience for my son. So the second summer that I had been operating, my wife moved out and said we are putting my son Luke in a different school system. Like that's just what we decided to do. So that was either going to be a private school in a nearby town or it was going to be in Denver. And we made the decision to say, based on her work and her travel schedule and all that, that Denver was the path for us.

The downside for me personally was literally just get my family now under one roof. The week after my family moves back into our Breckenridge house, we're down in Denver looking at rental houses. I remember it was, I don't want to say traumatic, right? But it was like, you just got here. Let's enjoy being together.

Now we're looking at continuing this geographical separation, but instead of being 1700 miles apart, we're going to be whatever, 50, 60 miles apart. So, anyway, not. Not a fun part, honestly, was a. Probably a bit of a motivator for me in terms of, like, what I wanted to do next in this case, work with PSG directly. And just before we turn our attention to that, Jack, tell us a little bit about how you found.

[00:57:53 - 00:58:07]

Will Smith: How you found being an operator. So for me, I think we all hold a. Many of us that are searching and want to go down this path. I think we. We have a.

[00:58:07 - 00:59:23]

Jack Saville: We think we have a healthy respect and appreciation for what it takes. I think until you're in it and until you're getting punched in the mouth every single day, 30, 40 times a day, you don't truly appreciate how hard it is and how challenging it could be just on. On you personally and all the things that go with it. So I will add that, like, I got a lot of joy in leading the team and building the relationships and doing really hard things. I also recognized for me that, like, a huge part of my why is having a big impact, like, solving big problems and having a big impact, operating a business of effectively 25 people, right, is like, it is impactful.

Like, you are impacting, like, you're writing the checks, right? There are paychecks every single week. You're impacting the lives of 25 people. Um, but I. I honestly wanted to do more and bigger, and I missed having a peer group. I missed having the impact on, you know, really, really big problems instead of the small tactical problems.

So it's not to say that I didn't enjoy operating, but in many respects, like, I. I felt like there was something more for me that. That would really give me that joy and fulfillment. Um, and again, I'm, you know, still early days of PSG, right? But, like, I am finding that, and it's also reaffirming that my. Why is solving big problems and having a big impact?

[00:59:23 - 00:59:49]

Will Smith: Jack, that last point, you make of about feeling impact or maybe lack thereof, that being an operator of a 25 person business surprised you that you didn't feel. What do you think? Say more about that. That's kind of new to me. And what do you think maybe you missed or you would forewarn listeners about on the sense of impact on a day to day basis?

[00:59:49 - 01:02:14]

Jack Saville: Yeah, it goes back to a little bit frankly of just like the resort community that we were in. So I have no other operators, right. And they're in a bigger market and there is, I don't want to say that there's an endless opportunity, right? But like there are many paths that you can go down to frankly increase sales. Right.

To hire more people and to chase a bigger market and all these things in Brazil. Breckenridge, Colorado like, there's inherently a ceiling to that, right? Like again, I've talked about the labor issues that we faced, but there's, you know, unless we pursue a different market, which is really, really hard, like again, labor, capital, all the things that go into doing that, right? Like my personal time and where I'm going to spend my time, like there was, there was effectively a cap. So for me there was this recognition and again, maybe it was my failures as an operator, operator here too.

But like there was a recognition on my part of like something would fundamentally have to be different in order for me to get past that, you know, subscale small business. Call it what you will, right? And again, give Chris and Sam credit. Like, I remember we had the conversation of like, would you ever consider joining us? Like it wasn't the path or the plan that I had gone down, but good or bad, like it planted that seed in my head and it really started to make me question again back to my why and why I'm doing this.

And again being away from my family and all these things, right? And it was like, this is a path to go. Like my why became clear and now I had a path to go do that with great people as well. So it's again, decisions like this, like there are lots of different factors that go into it of what gives you fulfillment and joy and drives a big decision. So I think it was all of those things in totality versus just the one instance or the one recognition or the one component of a 4 to 5 million dollar business, you know.

So does that help? It does help. But I, I do think, even though there was, there was a lot going on there, Jack, that there's a, for the audience there's an important maybe general point to take, which is that in a small market and one that has kind of a, in your case, a geographic kind of moat around it, for better and worse. So from a pure dollars sense, we already talked about it, that that's a, that's a weakness to the business because it can only get so big. But it also sounds like now this is the part that's important to the listener, that there can be there that can feel constraining as an entrepreneur.

[01:02:15 - 01:02:47]

Will Smith: So you get in there and once you know, you're through your transition and your J curve and you feel like you're, you kind of figured it out, you might not be able to get it beyond half a million bucks a year in SDE or a million bucks a year as sde. And to those listening who are still sitting in a W2 and think that buying a business and having half a million or a million dollars of SE sounds amazing, and it is. You know, once you're there and, and. You realize there's nowhere else to go. It might feel a little not great after a while.

[01:02:48 - 01:03:55]

Jack Saville: I'm going to ask your question a little bit differently. Okay. Because again, back to Chris planting a seed with me, our business partner. He, I remember distinctly, he asked me, and he said, jack, you, you have acquired a fantastic lifestyle business. Do you want to be a lifestyle business operator?

And honestly, the other seed that he planted was, I think you're underutilizing your talents. And again, I've got low ego. I'm a relatively humble guy. Right. But like, that also resonated with me.

And, and again, it's not that I was better or like that the business wasn't big enough, but for me, kind of back to reaffirming my why. Like, it wasn't running a lifestyle business. And that's, you know, unless we fundamentally do something different, which, to be clear, like, we are pursuing those steps now with PSG and our strategy there. But like, unless I pursued something differently, I was going to continue to own and operate a lifestyle business as long as I sat in that seat. And that's just not.

Again, back to understanding my why. That's not what gave me joy. So probably not the answer that you were hoping for with your question Will. But Sam, from your, your perch at SM Boot is, is any of this resonating you want to add to anything? Absolutely.

[01:03:55 - 01:06:07]

Sam Rosati: What I want to add is that the experience Jack had is way more common than you would imagine people think. First of all, this is not a question for Jack or this is not an issue of do I Want to be an entrepreneur or not? It's like, what seat do I want to be in? What do I want my life to look like? What do I want my business to look like?

And a lot of times, the idea of being an entrepreneur, the lens we have for it, because we can go to the Internet and read like, you can start something or you can buy something existing. Well, you have no idea what it's like to be an entrepreneur in that framework until you do it. And so I'm trying to take some pressure off anybody who's listening to say, just because you make a decision to buy a small company with an SBA loan and potentially move, and then you realize, this is harder than I thought, even though I read the books that told me it was going to be harder than I thought, that's okay. It's okay to find out that maybe I changed. Maybe the.

There's also Jack's talked about it. This is not the right analogy for various reasons, but, like, a little bit of PTSD related to that time because he was away from his wife and his kids and a little bit isolated and doing something so new to him, running a small subscale business. So this is all hard. And all the people that come through boot camp and close go through this. I.

There are names you all would recognize who have said multiple times, like, this is, I'm not sure I was meant for this, or I'm not sure I want to do this forever, or the city I bought in, I really don't want to live here forever. So I have two options. Either sell the business or bring somebody in that can run it. And that way I'm free. And so I think the punchline for people listening is this is entrepreneurship.

You have to weave it together with your life. And if you think the direct path is going to be the path that you take, that's not true. But if you never try, you'll never know. And if Jack never bought Strategic and then realized that maybe another path was for him, we wouldn't be here on this call. Yep.

[01:06:08 - 01:07:07]

Jack Saville: And I'd still be sitting in my corporate seat. You know, like, that's the. Like, that's sometimes the other side of the coin, and that's not good or bad. I think it's just, like, I recognize that that wasn't the fit for me. And so regardless of not knowing where that path may have gone, like, that was a key part of my risk criteria too.

Or decisioning is, I'm okay with not having the other side of that coin, regardless of where this may or may not go, you know. So anyway, sometimes I reflect back on, like, I think as I'll consider myself an entrepreneur, but like, just as, as a man, as a human, like, we're not made to be complacent. We're not made to do easy things. And like, that's part of frankly just waking up and being excited to get out of bed every day and being proud of what you do. And it's, again, it comes with risk.

It comes with people are going to look at you and like, you really, you own a fence company. Like, I don't, I don't get it. Right. But anyway, it's. I think it's just a key part of how you think about life or how I've chosen to think about life as well.

[01:07:09 - 01:07:31]

Will Smith: Thank you, guys. It's great. Well, bring us up to the, the big decision here, Jack, and how this, how you pivoted out of where you found yourself. So again, I had this couple seeds planted by our friend Chris of is this something that you may want to explore? And at the time it was like, it like definitively was not.

[01:07:31 - 01:10:01]

Jack Saville: You know, I was pretty in early, the early days or kind of within the first 24 months, of course, of operating my business, getting my feet under me, starting to get some traction. Like, our second year of operating, we had pretty good growth, I would say, and saw a path to generating good cash flow and put money in my pocket and all the things that this had intended to be when I first started. But again, he planted that seed of would you want to join us and do you want to run a lifestyle business? And like, I think you're underutilizing your talents. Like, all kind of probably those three things combined really just opened my eyes to, like, what could be next.

I'd gotten exposure at this time, of course, to Sam, but kind of the rest of the PSG leadership team. And they were people that I generally enjoyed being around and have respect for. So again, kind of back to the peer network. Like, I was also creating a new peer network as well in a working capacity, not just get together once a year at a strategy type meeting that I happen to be invited to. So of course talk with my wife about it and my kids.

And there was the family dynamic of, like, had just been living apart. So again, lots of decisions went into that, but we decided that this is the right path for us collectively. Sam, I don't want to speak for PSG here. Right. But we took on a capital provider.

It was pre me, but right Took on a capital provider that I think gave PSG a little bit more flexibility and leeway into, you know, potentially also going down this path. So it was just like, it was just good timing, I think, for everybody involved. We've all got the same goals. We had the same goals and now very much have the same goals in mind. And anyway, it became somewhat of an easy decision.

Like, once I had started to go down this path, mentally, for me as well, I'd say the biggest holdup was, I think, what a lot of sellers deal with. And we talk with sellers today, and they're frankly, a lot of times their biggest concern is what do I tell my team? Like, you feel in some ways like you're quitting or you're abandoning them or whatever the case is. Right. You tell yourself all these, all these falsehoods.

But like, that. That was probably for me, the biggest thing for me to mentally get over of, like, what is the message that I take to my team? Because again, I'd only operated for two years. Right. And they had gone through the.

The trauma of, of having a new owner in place. So, Sam, you want to add anything? I do. So I think it was actually a relatively fortunate thing. We were both coming to the same conclusion, I think Jack and PSG at around the same time.

[01:10:02 - 01:11:56]

Sam Rosati: On the PSG side, we, and this was about a year and a half ago, we were growing a ton, the old fashioned way, but also through acquisition. What was not growing a ton was the leadership team responsible for keeping the train on the tracks. And we looked around at our network of people we knew and trusted, and we and. And asked the question, who could we bring on board to help us on this crazy journey in a good way? And Jack was the.

Not an obvious choice, but the obvious choice. He probably doesn't know this, but I'll share it with him now and see if he blushes. Um, I remember we were in Phoenix at a crappy restaurant in downtown, visiting one of our locations. And I essentially said, I don't think we have a choice but to find a way to get Jack on board anymore. And so it was very clear to us, like this was not this.

Both of us were fortunate to be here, to be clear. And so we ended up, I think the. There was a step there where we weren't sure if PSG was going to be the right acquirer of strategic because of a whole bunch of considerations. But we knew we needed Jack. And so we, we went down a road to see how we could get Jack, but potentially not strategic.

And we realized like that was another limiting belief that we had that Strategic could be successful under our watch. And so that's when we got to the conclusion that we could acquire that business. We just had that intermediate step of taking on a capital partner which will. We've talked about that on a podcast. We recapitalized the business with a private equity firm and then immediately turned our attention to bringing both Jack and Strategic under the umbrella.

[01:11:57 - 01:12:24]

Will Smith: So. So before you partnered with private equity, Sam, Strategic didn't really fit the profile of Fence company that you guys were targeting. Then when you did it, it loosened up your criteria a little bit and Strategic Fence could fit. No, I think what we had was we were, and this is a common theme. I don't know if we pointed it out enough, but sort of self limiting beliefs are so common and we both struggle with them.

[01:12:25 - 01:13:25]

Sam Rosati: When we formed PSG Fight four years ago, we thought we were going to be a Florida focused commercial contractor doing fencing gate. Now we're a nationwide installer of perimeter security, broadly defined. So the what it it has become has so outgrown our initial thoughts and beliefs in spite of that. And so here we are. We looked at Strategic and said, well, wait a minute.

It is exactly the kind of business that we would ordinarily buy except for a couple things. It's in a bit of a smaller market, number one, and you generally can't put Fence in the ground year round there. But why does that make it a bad candidate? It doesn't. It just means we have to manage around those things, manage around seasonality of labor and working capital and find new ways to grow.

And so that's what in order to build a big business that you read about in the newspaper one day, sometimes you have to change the things, the beliefs you hold on to dearest at the beginning.

[01:13:27 - 01:14:16]

Jack Saville: And I think we're, I mean to be fair too, like I think we're still on that journey with other conversations that we have, whether it's other acquisition targets or where do we want to be in 12, 24, 36 months? Like these aren't the things. Like we didn't just click that or flip that switch and say we are no longer self, self limiting in our beliefs. Like had a conversation with a gentleman yesterday about literally the exact same thing. Right.

And so we, I think we're all collectively still learning this lesson and like being willing to take on the right risks for the right reasons too. So anyway, back to your point around the theme. Like I think it's really healthy theme. To to highlight and Sam, this management hole you, you were needing to fill. And, and that Jack was the ideal candidate for what, what, what was what, what, what role was that title?

[01:14:16 - 01:14:26]

Will Smith: Responsibilities. And why was Jackson the fit? Other than he's amazing but the actual. He just told me to go figure stuff out. I think for the actual job description.

[01:14:26 - 01:15:28]

Sam Rosati: I'm pretty sure we said that to each other four days ago. We're going to be saying that for a while now. So what we need is a leader of people who can first and foremost be a phenomenal leader and get people on board to want to go to war with them. No pun intended there. Bad choice of words.

And yet we needed somebody that had fence experience. We didn't need them to be able to run a day to day fencing organization, but to be able to lead others to be doing that. So what that specifically means for Jack today is the Western Market President. So he is responsible for the performance of our entire business essentially west of Texas. And that business is pretty large today and in short order it's going to be a heck of a lot larger.

So it's a big responsibility. It makes Jack's life and roles and responsibilities change day by day for better and for worse. Yeah, but that's, I mean, but that's also the exciting part too. Again, like, again not to compare it to that opposite side of the coin of the corporate world. Right.

[01:15:28 - 01:16:10]

Jack Saville: Like maybe you're changing job every couple years. Right. Or you get a new manager every six months. But like it's exciting not knowing what might be next or helping to figure out who's the next target to help continue to build PSG in a respective market. So I think that is also very much scratching that entrepreneurship itch that has been there for a while.

That's kind of started in earnest with my search. And you know, so even though it's a little bit of a different capacity, it's just again it's a bit more. Fulfilling too give you some more detail here just because it's helpful. Yeah. What it also meant is when we transacted in February, it meant Jack had two very different roles.

[01:16:10 - 01:17:10]

Sam Rosati: One was as the shepherd of strategic fence. He needed to find a leader to take over that day to day role and be he. Jack is and was and is responsible for making sure that progression is successful. But then to also go help us oversee and grow the locations in the Western market that we have today. And as we spoke earlier this week, we were on the road pursuing a very fruitful conversation with another business owner that would fall under Jack's purview in the Western market.

So you talk about a role that changes every day and has a lot of excitement to it. And Jack's my financial partner too, so we're getting to go build wealth in our own pocketbook every single day. It's exciting even though it's not SMB ownership strictly defined. Yep. And on that point of ownership, Jack, that had been a central driver for you when you started out on this journey.

[01:17:10 - 01:17:31]

Will Smith: How do you think about it today in and the ownership that you have, obviously you have equity in this enterprise, but it's not, you are not the owner. So how do you think about that? Yeah, like it's, I mean just to be in completely transparent here too. Like it is a journey that I am still on. Like again, not to overshare conversations that Sam and I have here personally.

[01:17:31 - 01:18:22]

Jack Saville: Right. But it's like there is, there is nothing that is limiting me today within PSG to go figure out how we run the Western market and to contribute of course at the PSG level. And if there's anything that if there's a day where I don't feel like I have ownership or that I'm waiting for something from someone else to give me, like that's a self limiting belief and I need to work through that. So again, like I am still very much on my own kind of mental professional journey here, but I'm doing it with people that say just like Sam said to me earlier this week, just go do it man. Like there's literally nothing holding you back.

How many places are you going to find that? Absent of if you're owning your own business but you're constrained by whatever your debt or your, that self limiting belief or your fear of the pg. Right. But it's like, like my, my, my kind of growth, it just, it's continuing. So I'll leave it there.

[01:18:22 - 01:19:15]

Sam Rosati: Well, let's put, let's put a bow on that. We had a real conversation around that. In our business today we need entrepreneurs that can act as if their P L is has a, is a five million dollar revenue business. Even though we're many, many times bigger than that. You know, we need people to act like they are where the buck stops.

They are the sole owner because execution is the most important thing. And if we get caught, you know, building a capital C corporation where things are slow and there's a lot of red tape, we just won't grow the way a small business will. So we have to strike a balance there. So we talked about that. And Sam, I think this is an important point with respect to the fact that you partnered with private equity.

[01:19:15 - 01:19:19]

Jack Saville: Private equity. Can you name. Can you name the fund? Yeah, of course. Bertram Capital.

[01:19:20 - 01:20:09]

Will Smith: Bertram Capital out of San Francisco. So you partnered with them, which of course is. Means you sold a chunk of the business. We don't know the details. And often when that happens, the entrepreneurs, the owners, will roll equity and work there for a while.

But it's kind of very often kind of the end. In. In this case, it. It feels like it has a different flavor. Maybe this is common and I don't realize it, but it feels like a different flavor because it seems more like you got an infusion of capital and you.

The original principles are continuing to be just as involved in pushing it forward as you. As you were. Is that correct? Is that in fact a slightly distinct format? Yeah.

[01:20:10 - 01:21:23]

Sam Rosati: Is it distinct? I. I don't know because my sample size isn't that big. I think what's unique is the partners that we took on are phenomenal partners. They trust us, they let us run, they help us. They answer the call when.

When we need help, they are supportive, they listen. And that's all fantastic. That's what we were looking for. In many ways, we might have gotten lucky that we ended up with what we were actually looking for. But it is true.

Nothing has changed in the sense that it is generally the same team. Plus, you know, we've had to add. And maybe they bring a little bit more discipline because we are now doing the heavy lifting of digesting all of these acquisitions and building an integrated perimeter security business instead of like a collection of bridges, brands and locations. So they're helping us do that. We've never done that before, but yeah, I mean, this.

It is fundamentally the same team tasked with just running faster. So it. It's more entrepreneurial than ever, other than we have partners to help us. And so when was Jack, when did it happen that you sold to PSG? It was Valentine's Day of this year.

[01:21:23 - 01:23:58]

Jack Saville: 2, 214. I've vividly remember that day. I was skiing Big sky with my best friend and his family and frantically trying to wire money to close the deal and signing DocuSigns and all that stuff. So that's anyway, 2, 214 to Sam's point. And my role stayed, you know, effectively as president of Strategic Fence and getting a GM on board.

And I think technically it's still my title probably on some document. Sam. Right. But again, having a great GM in place is really making. Making it fruitful.

He's, he's doing way better than I did, honestly. And it's, it's fun to be a part of that too. So. And Jack, just final question on that, because that is the aspiration of many searchers, to put in a GM and to be able to step away. You've effectively done that.

You're roll. I mean you're, you're obviously watching Strategic Fence, but the whole point was to be able to get you focused on PSG, whole western market. How do you reflect on being able to find a gm, putting them in and, and unlocking your ability to, to change your focus. That's. I would save.

I'll save. Yeah. For anybody that is like has this easy button they think that they're going to hit to go hire a gm. Like one, it's not easy. Two, it's expensive.

We use a recruiter. I think we got lucky in finding this gentleman. I think being a part of PSG and for him to see that this opportunity for him is also or can also be bigger than Strategic Fence is super, super important. He's also, you know, effectively, I don't know what we call it, Sam, but he's also like, he will share in the future benefits of PSG when that time comes, right? So he has got some financial, very much some financial stake in this game too.

And he's just a great dude. Like, I mean, that's the thing is like, I'm a huge firm believer of just work with people that you really like. And he is that for me, certainly in that location, but also a broader friend. But it's not easy. And I think we talk about, you know, kind of making your own luck sometimes, Sam.

Like this was an instance where I made my own luck and hold one holding a high bar. But to like putting the right structure in front of this guy and you know, just being there to support him and serve him as well. Guys, anything about this story, plot point, or probably more importantly, a theme that we didn't hit on, that you wanted. To, I would say is maybe a few more things. One is, if you step back, what can a broad swath of your listeners look at this and think this is two guys that are just trying to make their own luck and that's what entrepreneurship is.

[01:23:58 - 01:24:59]

Sam Rosati: And this story also is not yet done, so we'll see where it ends up. But you know, entrepreneurship is a winding road and that's okay. But also know that when you get into it, it means an unpredictable outcome, pro and con. Maybe that's one. And the Other one is it is okay if what you do is you buy a business where your goal is to sell it to a capital backed group where they're in the business already, and you become part of a broader organization, that can be a good outcome for entrepreneurs.

And then that's what Jack did. And now Jack is over here on, on our team. Hopefully if this goes well, in the not too distant future, you might read about the business we're buying in the newspaper and our families will be better off because of it. And so there are different ways to do entrepreneurship. This is just one.

[01:25:00 - 01:25:23]

Will Smith: Jack. Anything else or if not worth. Yeah, I mean, I would say just in one maybe closing thought for me. And, um, like, we talk a lot about like, knowing your why in terms of like when you get into search and, and you know, closing on that business and when you've got literally everything that you have that's on the line to do this, like, knowing your why is super, super, super important. I think it's also healthy and good to continue to question that why.

[01:25:23 - 01:25:44]

Jack Saville: And honestly, like, just as our business is evolving with PSG, like my why probably evolved as well. And so asking yourself that why question over and over and over again and being honest with yourself and being willing to adjust when it makes sense for you and your family is important too. I love that. Well, guys, what. What a fun story.

[01:25:44 - 01:26:31]

Will Smith: And I love the philosophy that you brought to it. It sounds like you guys have, you know, great conversations over beers late at the bar after a long day, or when you miss your flight and you're stuck in a Vegas hotel or whatever it is we've got, we've gotten a window into what seems like a really exciting and healthy relationship. And of course, the, the full circle nature of this. And, and Jack. Sam, maybe to your point about Jack's journey, how just getting in the game, not to oversell eta, but just getting in, in the game puts you on a path that can take you in interesting yet very unpredictable places.

And, and as you said, Jack, that path for you is still very much unfolding. But it's, It's. It's cool to see where you've ended up. That's it. Yeah.

[01:26:31 - 01:26:46]

Jack Saville: And where we're going, you know, so, good stuff, guys. We'll include links to both of you, your LinkedIns, so people can reach out if they want to. Sam, you're. You're very easy to, to reach anyway. Yeah, but, but we'll have a LinkedIn for both of you.

[01:26:46 - 01:26:52]

Will Smith: Jack Saville, Sam Rotti, thank you guys for coming on Appreciate it. Thank you. Will see you. Thanks Jack. Thanks Sam.

[01:26:52 - 01:27:05]

Jack Saville: Talk soon. Hope you enjoyed that interview. Don't forget to subscribe to the Acquiring Minds newsletter. We send an email for every episode. With an introduction to the interview, a link to the video version on YouTube.

[01:27:06 - 01:27:37]

Will Smith: And soon, key takeaways, numbers and more. Essentials from the interview. For those of you who don't have. Time to listen or watch it, subscribe at Acquiringminds. Co. You'll also find all our webina.

Webinars there on the website, both those we have coming up and recordings of past webinars. At this point There are over 30 webinar recordings, a wealth of information on all the technical nitty gritty of buying a business. Acquiring Minds Co.