Host: We all know that hiring has been tight, to say the least, especially in the trades. In blue collar industries, finding good people is a top challenge for entrepreneurs who've acquired businesses in those areas. So it may have occurred to you that a good business to buy is actually upstream from blue collar businesses themselves, right at the source of supply for talent. I'm talking about trade schools or similar education businesses. Well, today's guests did buy such a business, a CDL school that is a training business for aspiring truckers. To get a commercial driver's license, Tyrell Sulzer and Bob Boniface bought TransTech, a $7 million CDL school with locations across North Carolina. I was very interested in this business. First, I wanted to understand if there was in fact any merit to this idea that trade schools could be strategically interesting businesses to buy. And I wanted to understand trucking, an industry that's always held kind of a naive romance for me, the big rigs and open roads. So we go deep on that, as well as the story of the acquisition, of course, why Tyrell and Bob decided to do a traditional search fund, why each of them was committed to buying a blue collar business, whether to partner when searching and what the partner dating process might look like, and what British Columbia native Tyrell would tell his compatriots about the opportunity for search in Canada. Challenges in the trucking industry notwithstanding, I am excited for this business and others like it. Please enjoy this conversation with Tyrell Sulzer and Bob Boniface, owners of Transtek. Quick announcement everyone. I'm really excited about this. We have a series of webinars coming up that are fantastic tactical, meaty learning opportunities. The first of the series is a financial modeling deep dive. Modeling is probably the most technical part of putting your deal together and it's daunting to those of you without a finance background. So come learn how to model a self funded SBA finance search deal. As you know, these are the types of deals that are most common among Acquiring Minds guests. And we're going to model a real SBA acquisition. It's actually one you've heard the story of on Acquiring Minds. This is John Hubbard's deal to buy Express Trailers, the trailer fabricator in Tampa. Now, in addition to the content, you'll also be given access to the model so that you can learn it with us and then use it in your own deal. The webinar is this Friday, January 12, noon Eastern. The link is in the show Notes. So open your podcast app, look for where it says register for the webinar, do so and Then join us Friday. And if you can't make it this Friday for the live webinar, make sure to register anyway so that you can access the recording later. I'm partnering with Sam Rosati on these webinars. You'll recognize that name. Sam runs a boot camp for self funded searchers. He's been on the podcast. He's an investor in search deals. He has his own holdco.

[3:30] Guest 2: His own.

Host: He's a founder of SMBash. Needless to say, Sam knows modeling cold and maybe most importantly, he is a great teacher of the material, having taught it so many times. So come learn how to model a self funded search deal this Friday, January 12th at noon Eastern. Register in the notes. 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 Oberle Risk Strategies, an insurance firm with a dedicated practice group for searchers and acquisition entrepreneurs like you. If you've got a business under loi, Oberle will provide complimentary due diligence on that business's insurance and benefits program. A great no risk way to get to know August and team. They love helping searchers. They've worked with hundreds. Oberle is a specialty insurance brokerage for searchers by a former searcher. Check out oberle-risk.com O B E R L E- risk.com link in the show notes Tyrell Sulzer Bob Boniface welcome to Acquiring Minds.

Guest 2: Thanks for having us Will.

Guest 3: Thanks Will.

Host: The two of you partnered to do a traditional search fund and acquired Transtek, which is a CDL school. So people wanting to become truck drivers, school bus drivers, other operators of large vehicles need to get their license. And you Transtech, you all are a school that trains them. So we're going to touch on a lot of themes today. Trucking, trade schools, partnering to do a search and a lot more. Let's start though with some background on each of you. Tyrell, will you go first please?

Guest 2: Yeah, sounds good. Thanks for having me Will. I'm a Canadian so I was born and raised in British Columbia. We do wood, you know, mining and oil up there. So I ended up going to engineering school at University of British Columbia, worked for an ExxonMobil subsidiary called Imperial Oil up there and I worked kind of fly in, fly out of Northern Canada, living in camp and Working with mining crews to build large mining infrastructure for the oil sands. After that, I went to business school. Spent two years there. I looked into doing the investment banking thing. I had a friend who went to Goldman ahead of me, tried that out and turned 180 degrees and went right back. And as I was trying to figure out what to do next, I interned with a searcher who acquired a traffic control business in Atlanta. And I caught the search bug. And so from there we'll get into it later, but met up with Bob and decided to run a traditional search.

[6:41] Host: Great. And why did you run from investment banking? What didn't you like about it?

Guest 2: You know, I felt like I kind of missed the, the market in my lifetime to do that, you know, kind of lifestyle. I had a fiance. We were planning to have a family soon. And the, the late nights, you know, got to me. Coming from the mining world, you know, it just, it frustrated me that I had to be up at 9 and then up till 2am, 3am, you know, doing the banking stuff. I was like, just, just put me on night shift. You know, I can do this if I can just get some sleep. Um, so. But great learning experience. Like love the, the people that were there. I think it was the right firm. It just wasn't right for me in my late 20s.

Host: Gotcha. So naturally you chose the much easier path of getting into small business. Bob, your turn.

Guest 3: Yeah. So I'm from Detroit originally, come from an automotive family. My dad's a car designer at General Motors. Kind of grew up loving cars and you know, seeing myself working in the industry. After college I went to end up working at General Motors where I worked in manufacturing finance, helping to kind of design and run the budgets for the North America manufacturing operations at gm, which is great. You know, it kind of got that exposure to operations and how to set up a plant and make it more efficient and you know, work with, hands on, with the product, which I thought was really cool. As a car nut and as someone who likes to see kind of something tangible to work on, I went to business school with the goal of eventually going back into the auto industry, possibly at General Motors. But pretty early on I discovered this search fund path and as someone who always had this entrepreneurial itch in the back of my, back of my mind, but never really had the great idea that I would say, hey, this is worth foregoing a couple years of income and possibly going for broke here. I thought it'd be really interesting to pursue something like a search fund given kind of the, the One shot. Coming out of business school. At business school, I spent the summer interning for a family friend's automotive supplier. So it was a automotive forging company stamping steel parts in a hot, dirty, sweaty warehouse. And I fell in love with it. I saw that the same skills that I kind of learned at GM were easily applicable to small businesses and the same challenges that business companies were solving and that I felt like I liked working on there you can work on in a small business. Except that the difference is that the rewards of that end up going in a greater share to your pocket versus, you know, some big company that you're working for. So that was kind of what, what kicked me off on this path.

[9:15] Host: Well, I, I also recall from our pre call, I think Bob, you saying that a lot of the kind of corporate best practices can be applied into small businesses and you know, you can get a lot of wins there just by kind of bringing that, that corporate knowledge down a little bit. Great guys. And so you meet at business school and, and you kind of have both kind of figured out that search is something for you. How do you meet? How do you decide that this is a project you want to take on together?

Guest 2: Yeah, so Bob and I met in the kind of early days of business school, but never really, you know, our friend groups overlap but didn't really talk that much. And there's a, you know, a class on search when you kind of discover becoming search curious or thinking about the, the, that world of search. And so as we were trying to figure that out, exchanging notes on investors, you know, kind of who we talk to, other searchers, you know, kind of how it would look. And, and so I think during that timeline, you know, both listening to each other in class and then swapping notes on, on actually going for it, we, you know, kind of ended up converging in, in a partnership model afterwards.

Host: That is a big decision. Partnering in any kind of multi year life project is a, is a big decision, but oftentimes the two people already know each other. So you guys kind of decided to partner before knowing each other very well. Talk to me about how that looked and how you kind of, how you did that in a way that you felt like you were sufficiently diligencing each other.

Guest 3: Yeah, I, I think it was interesting because we kind of approached it from this, this point of saying okay, regardless of whether we partner or not, you know, we're both going down this search fund route. So you know, I think it gave us a little bit of optionality up front to say, you Know, if this doesn't work out the worst, at least in the early stages, we're just trading notes. You know, we're talking about who have you talked to in the investor community, what kind of businesses would you like? And it would just, you know, help kind of strengthen our knowledge about search funds, you know. But I think once we decided to formally start, you know, investigating this thing, we kind of approached it from two different angles. One was kind of the academic angle, which I think I'll let Tyrell talk about a little more because he kind of designed that process. But, but I think a lot of it was just learning kind of what are deal breakers for you? What kind of business are you looking to acquire from a very tactical standpoint, Would you be comfortable running a software business that's sold into the blue collar space? We both knew that we wanted to do blue collar, but that means a lot of different things to two different guys. If Tyrell wants to do an oil and gas business, coming from his background there, but I want to do automotive. If the business is in selling oil and gas supply stuff in Lubbock, Texas, it's going to be much easier sell for Tyrell than for me, who's going to learn a new industry and move to a new spot. So I think getting into, okay, what, what are the universe of businesses that we like to acquire but also doing some just casual social engagements. So, you know, going out to dinner, meeting Tyrell's then fiance, now wife, Julia. We, we also took a ski trip. You know, so these are, you know, these are things that maybe seem kind of, maybe silly and small, but I think it was really important to understand, okay, what, what's Tyrell's sense of humor? Like, how does he kind of view small business? Is this like a get rich quick scheme to him? Because I, I knowing have done, having done a little bit of homework at that point, I know that this is a hard path. This is something that, you know, takes a long time. Like you said. Well, it's a, it's a multi year commitment. And so you don't want to sign up with someone who views this as like a bang. We're just going to be successful day one. And you know, this is going to be a long grind. And I, I, I think it was useful that, and helpful that we had kind of had that relationship where we knew that we could hang out socially, be serious together, work on kind of challenging problems. We also did a couple school projects together that that would help and kind of test that relationship in a small Way. Um, but knowing that looking back now as a. As having acquired. We've moved twice together in. In a year and a half. I've. I've lived with him and his wife for four months when we first bought the business. So these are things I don't think you could do unless you could have at that base level, like a really good, you know, enjoying hanging out with this person.

[13:30] Host: Yeah. Yeah. Well, of course, Bob, everything you just described, there's a word for that, dating. And I know the joke, you know, tells itself and that you guys have jokingly referred to it that way as well, but it. The process is similar. I mean, it's undeniable, it's unavoidable to come to that conclusion. And then why did you guys independently. Just the concept of having a partner. Because some people don't even consider having a partner. So aside from you choosing each other, being open to the very concept of it, what did you see as the benefits of not going. Not going down this path alone?

Guest 2: Yeah, I think, you know, in school we had heard from a number of searchers. I, you know, I think the. The part that's hardest is, you know, when the deal breaks, when the company's not making money and you're by yourself, there's this intense sense of loneliness. And that, that kind of came out all the time as being the hardest part. And then when you listen to the partner searchers, you know, they were able to kind of articulate that they were able to get through that kind of low point. So I think there's a bit of emotional risk mitigation in going for a partnership. And then similarly, some of the best outcomes we had heard of were actually partnered searches. Part of that, I think, is we hear all the time working in the business versus on the business. And I think when there's 2 people, you're able to divvy up some of the. In the business tasks and get to that onto the business faster. So I felt like it was one plus one equals three a little bit with the search. So it wasn't mandatory for me to go do it, but it was certainly worth considering, you know, from an emotional standpoint and a financial return standpoint.

[15:03] Host: What about you, Bob?

Guest 3: Yeah, I think I echo everything Tyrell said, but I think also just from an academic standpoint, you look at some of the data that we were seeing, and it was clear that partnered searches acquire more often. They typically have a better result in terms of money over invested capital from a return standpoint. And I think it would just be A lot more fun. You know, I thought going into this, the idea of searching for a business for up to two years by yourself with no one to talk to other than maybe your parents and your investors, sounded like a pretty lonely path. I think doing the math on okay, if we split the returns, I can still feel very comfortable with the return that we could get here. I just thought everything kind of pointed towards, towards a partnership. I also knowing that having just seen other entrepreneurial ventures outside of the search world, kind of in case business school, the people that have gone by themselves, like Tyrell said, when things don't go right, it is just an intense period of kind of loneliness and kind of mourning the lost deal or something like that. And I think having someone to, you know, hey, let's go get a beer or something like that, when a deal breaks would be a lot more satisfaction. And then, you know, writing it out by yourself.

Host: Sure. Well, you guys are, are selling it pretty well here. You, you, Bob, you just mentioned the economics. Doing a partnered search means you split the economics. You guys did a traditional search fund. We're going to get to that in a second, why you chose to go that path, but just to get it out there. These are, these are kind of industry standard numbers. I'm just going to share with the audience that if you do a traditional search fund, independent, solo, traditional search fund, your equity ends up being 25%. Assuming you hit all of the performance thresholds, you'll have 25% of the business ownership. If you do a partnered search, you'll have collectively 30%, which means each of you have 15. So, so the kind of economic decision you're, you're making is do I want to own 25% of a business by myself or 15% of a business with a partner? And then you say to yourself, well, you know, with a partner, I'm more likely to be successful to find a business and then in that business to be more successful. My downside is mitigated. At least you hope you feel. And then the kind of intangible, Bob, you said that it's more fun to do it. So that's, that's kind of the attaching some numbers to the calculus, which I think is important. Aside from having to split, split the money, split the pot. Are there any other downsides? I mean, I guess that the partnership implodes. That's the obvious one. But anything more specific or is that really. It's just the partnership might not work out. That's the big kind of big downside, I guess.

Guest 2: Yeah, and I think, but going into kind of what does it look like when a partnership, you know, implodes or something like that? I think there's partnerships early on that can, you know, reach. Inevitably you're going to have disagreements on the path forward. And I think how you resolve those, you know, just like any other relationship is going to determine that. So I think if, if you're unable in a partnership to get over those kind of things, I think it can really paralyze a search and a business. If you've got kind of, you know, misalignment and goals like Bob talked about at the beginning, that could prevent you from finding a business that could have you, you know, pass on really good opportunities as well. So one plus one could equal three, but it could also equal zero pretty quickly.

[18:33] Host: Yeah.

Guest 3: And I would say also that we, we talked to a lot of our, our friends that know search for longer than we did. Admittedly, we found a business pretty quickly. So, you know, our partnership in the search phase wasn't strained in a way that it could have been if, say, it lingered on into late into the second year where, you know, there kind of is that urgency to find something or else you're going to kind of walk away with without a business. But we talked to some of our colleagues who are still searching and you know, when you have to do that, pivot away from kind of, okay, what is our strategy? Are we going more broad based on a search versus kind of this very focused thing that we started with or, you know, hey, the, that magical unicorn healthcare business that we were seeking out doesn't seem to exist at the price that we want to pay for it. We need to kind of broaden the aperture here. Yeah, I think having that discussion, if you're doing the search by yourself, obviously you can just change tact. But when there's a second person you have to get kind of buy in from, I can imagine that that could be kind of stressful. I think the thing that always helps and we remind them is, hey, the ultimate goal here is to buy a great business and run it and be successful. You know, don't let that kind of the tactics on how you get there cloud that, that ultimate goal. And I think, you know, what we, what we always have done and we did in our search and we do it now in the operating phase is you try things, you know, you try things, you try one partner's way, then the other partner's way. Go really hard at that for maybe a month or two. And if it's not working, then you can pivot.

Host: Listeners of Acquiring Minds know that for almost any business you acquire, its success comes down to the people and how you develop and manage them as their new leader. Thing is, in addition to management, there is also a lot of process and bureaucratic work when it comes to your new employees. Payroll, compliance, HR technology, hiring, to name but a few. These processes are crucial to get right, but at the same time distract from where you want to be putting your energy in leadership. So Aspen HR is an HR firm and PEO that takes this work off your plate and handles it with the care it demands. Aspen is owned and run by Mark Sinatra, himself, a successful former searcher. So Aspen's own leadership understands the HR challenges that searchers have post acquisition. The firm is offering Acquiring Minds listeners a complimentary pre acquisition HR and PEO review for your target business. Check out aspenhr.com or contact Mark directly@markspenhr.com Somebody touched on the fact that there was Tyrell, your kind of contribution to the dating period was actually really kind of codifying some of the characteristics, measuring stuff, making this a quantifiable, like a quantified exercise. Talk to us about that.

[21:30] Guest 2: Yeah, it comes from my engineering background. It's funny when you look at it, you know, I built a spreadsheet and a checklist and all these things to kind of diligence it out. And I think one of the benefits, you know, we call it like dating, but you know, if you show up to a date with a, with a spreadsheet ready to go, your date's probably going to walk away. Whereas, you know, at least a business partnership, you can actually be very upfront about that and say, well, hey, here's kind of like some criteria that we should, we should talk about. So I think you can be a little bit more objective as well. So that's what I did. I built the checklist, I sat down with Bob and we went through it.

Host: We don't have time to go through line by line because this is a 50 line or more spreadsheet. Literally, I'm looking at it in front of me. Yeah, 50, 60. So we're not going to go through line by line, obviously, but you could bucket the parameters into three different buckets. Can you share what those were?

Guest 2: Yeah. And so in the checklist and I thought about the, my answer a little more. I think like, you know, the goals and financial alignment is like really important, important upfront. Like what do you want to get out of this? Right? If this goes sideways, are you going to be really upset. You know, what's your minimum, like, walk away number? When are we, like, what's the biggest upside here? Are we aligned in that, what type of business? All those sorts of goals. That's one bucket. Second bucket I put in there was kind of a skills assessment, and that's like, rank yourself. Like, what do you think you're good at? And where. Where are we going to play when we acquire one of these things? Because it's going to take a lot of different skills. That's important for two reasons. One, you know, you can kind of allocate where you are, but also where you need help. And I think Bob and I both didn't come from an investing background, so when we get into why we chose traditional, that kind of like, pointed us towards that model, hey, we need to get a deal done. So skills goals. And the third one I, I think is, is kind of that. That fit Bob talked about as well. That's that kind of like, do I like this person, dude? Do we get along as well? And kind of like, yeah, side plus is the spouse as well. So you'll notice in that checklist, I had some questions for kind of, you know, Julia, that we had to go, you know, go and grab dinner all together and see if we could, you know, make sure my fiance didn't hate Bob or something like that, or vice versa.

Host: Comes and lives with us. How will you feel about it?

Guest 2: Right, right. Right.

Guest 3: Great.

Host: Well, that was great, Tyrell.

Guest 3: And.

Host: And just going back up to the goals. One in particular.

Guest 3: Yeah.

Host: You know, the value of this exercise is not just, you know, applying a methodology to whether or not you and Bob are compatible, but it also forces you to think through these questions on your own, which you might not have. You know, it's probably healthy to go into any big project like a search kind of knowing your own goal or, you know, what your number is or what you're, you know, where you're trying to go or, you know, etc. So, so thinking it's a. It's kind of a doubly beneficial exercise for that reason. The other thing, I'd say just about, you know, it's easy to tease about, like, you know, bringing a spreadsheet to this exercise, but, like, you know, in hr, hiring is getting kind of much more scientific, and there's all kinds of, like, measurement models and personality tests that are industry standard these days. And it's not unlike something like that. I mean, you know, where. Where you're kind of trying to. To tease out what this person, you know, kind of all the parameters that you just described, Tyrell. So HR managers are not shy about using kind of systems, so no reason that a couple of searchers would be either. Great. Well, just so it's not all roses, guys, tell, tell the people where your partnership has, has not been perfect. Just give us a taste of, of, you know, the behind the scenes on, on days when the partnership doesn't feel like you're just besties.

[25:09] Guest 3: I would say, you know, during the search phase one, one period where it was, I would say not strained but, but where we were under intense press pressure was, you know, when we were looking to acquire TransTech, you know, we, we found the company and went under LOI for TransTech, you know, four months in and it was our, our, the, the furthest we had been on the deal. We were under a time pressure to try and get this thing done in a, in a quick manner so that we could kind of enter the industry, kind of meet our, our own kind of timeline, meet the seller's timeline. And we had questions around, you know, okay, do we have all the information that we, we need to feel comfortable, comfortable about this? You know, are we foregoing other opportunities and kind of a push and pull on that? And, and like Tyrell mentioned, neither of us had come from banking or private equity or investing background before. And so as you're answering these questions for your investors who are intentionally prodding you and forcing you to defend your decision to invest in the company, it instills some self doubt that manifests where you and your partner are going to have those same types of arguments or discussions internally. Nothing obviously that stopped us from buying the company. But I think those periods where you're forced to say, hey, you know, how confident are we in this business? How confident are we in our ability to run this business? I think those are very healthy. And it's, I can, I think that was probably the most intense. It was just a very busy couple months still.

Host: And by the way, when you guys were looking at acquiring Transact or making the decision to do it, was one of you more enthusiastic than the other? And was that Delta big?

Guest 2: I think it moved in waves. You know, I think what was, what was funny is I think we played that in different roles because I think, you know, if I remember, like Bob was like really into the CDL training space early on and I was like, okay, this is interesting. This is cool, you know, and at some point the deal kind of like switched where it was like I was really bullish on it and I was convincing Bob, like, come on, let's go do this thing. You know, and I think we, we kind of ebbed and flowed and did that maybe a couple times over it. And I, I think, yeah, Bob hit the nail on the head of like it's those moments where you have to like kind of, you know, resolve the issue. And I remember like we sat down and I was like, look, you have a veto. Like either of us have a veto. I'm not doing this if you don't want to do this kind of thing and giving that kind of assurance of like I'm not, I'm not going to drag you adventure just because I believe it. So if I'm, I'm missing something here, you pull the rip cord, we're out. And so anyways, I think it ebbed and flowed. I don't know Bob, if that kind of.

[27:38] Guest 3: Yeah, I agree. I think it was, it was one of those things very early on. We love the industry and we love the space, but then it's, it's always like, well, is this the right, is this the right horse to bet on? Is this something that, you know, that we think that we can do just because it's, we're early, you know, like we did have kind of a two year timeline and we're four or five months into this thing. Have we had enough reps? Are we the, the right, right person to buy this company? Yeah, I think all kind of normal fears to, to have going into a deal as kind of a young person who's about to take over a big business.

Host: Yeah. Yep. You know, it's a good point about the finding a deal early, especially doing a traditional search fund where you have this two year number in your head. You're just kind of your, your psychology is anchored to two years. And so if you're way far, you're really far away from that two years. You're only a few months in. It's almost like, yeah, like you said, Bob is like, you just have this like, I feel like we're too early. Even if you found the right business, it's kind of a dangerous psychological trap. I mean you could have walked from a great opportunity just because you felt like, shouldn't we be closer to two years before we actually do do the thing, pull the trigger.

Guest 3: Well, I would just mention also it's funny because we had, we discovered CDL training very early on in the space. We kind of entered the thesis thinking training and a blue collar plumbing schools, electrician training. We'd heard that, that's a great model. But when we stumbled on CDL training, like two months in, we had Transtech on our board in like July, when we started in June. So, so it was not even like four months in. It was like two months in when we had found this company. It took us another couple months to get in contact with them. But it was, yeah, the fact that it was early, I think that was definitely something that weighed on our ability to say, you know, and fairly judge the company.

Host: Guys, just to finish off the kind of context of your search before we, we move forward. So why did you choose traditional? We haven't even talked about that. Some of the reasons to do a traditional search fund are kind of the support of your investors and the support of the whole kind of ecosystem there. So kind of the desire for more support. Doing this for the first time is a common thing that you'll hear traditional searchers say. But part of that box is now checked by doing a partnered search. You have each other, you have support in each other. So maybe it, it, it minimizes the need for that support a little bit. You still decided to do a traditional search. Talk us through that, please.

Guest 2: Yeah, I think the easier answer is, man, I was broke after MBA school. You know, okay, easy enough bills to pay that's needed an income. But I think the second part too is like, traditional is actually a really good solution to some of the, like financial, like it's kind of split right down the middle. Right. It makes the, all those questions very easy of like, what are we, you know, we're each going to make the same. I think when you go self funded and that route you're supporting your own income gets a lot harder in month 18 when you're going, hey, you know, I've, I've got a wife, I've got kids or something, you know, like, how are we going to split this? Who's going to eat this broken deal fee? You know, are we splitting that right down the middle? I think that gets a lot more difficult. Whereas when you raise a fund, it's like, you know, not to say it's house money, but you don't have to, you know, tit for tat. Who's paying for diligence fees when the deal breaks?

[30:42] Host: Yeah, Bob, do you want to add anything to that or is that pretty much it?

Guest 3: Yeah, I think, you know, like Tyrell said, I had literally handfuls of dollars in my bank account when I graduated business school. But, you know, I think also I would, I would say harping back on that point that neither of us came from investing, you know, we had investor groups who were, you know, really eager about working with us, who had done this hundreds of times combined between them, you know, people who had walked the path, like by themselves, investors who had done search funds and operated and now are investors. To try and put a number on that experience I think would be kind of foolish because similar to why did you choose to partner, why did you choose to go with investors? All these things I saw, and I think we saw as strengthening our ability to find a good company and get the deal done, which is ultimately the end game because you try and preserve all the economics you want upfront by going by yourself and doing a self funded search. I personally didn't feel like that. My percent chance likelihood of acquiring a good company with that kind of setup behind me, you know, was I didn't think the percentage was, was high enough for me to take that, that chance.

Host: And now that you're in it and you're operating the business, you found, acquired the business, you're operating it, is there anything about the traditional search fund model that you, is different than you expected? Anything that you've learned now that you're further into the path?

Guest 2: Yeah, I think, you know, the, the traditional model, you know, it lends itself to this like find a good company and platform business. Right? You got to buy a bigger, a little bit of bigger company, you got to grow it a little faster. You know, it's a little further out before you're in distribution land where you're sitting on a million dollars of EBITDA and you're content with that. So I think there is a little bit more pressure obviously from the investor base and a little bit more control on their side. What I think that's super helpful is like as a first time CEO, to have someone who's built it three, four times come through and sit on your board has been huge. And it kind of also settles maybe some debate between us of like, hey, what do we do next? To have experienced investor come in and be like, hey, do this. Where you know, where it can be frustrating is I think obviously you have disagreements with your board and you have to be able to present your case. But I think that's a skill you're going to have to learn over the course of your time in business. It's not always going to be just solo entrepreneur. If you grow a company to, you know, $100 million result, inevitably you're going to have other stakeholders come in and you're going to have to manage those.

[33:13] Host: Yeah, that's a great point.

Guest 3: Yeah.

Guest 2: I would add to that.

Guest 3: I would say, you know, as search funds kind of grow in popularity and more people enter the space on the entrepreneurial or on the entrepreneur side who are looking for, you know, investors to partner with, I, I think there are going to be, you know, you have to do your homework on, on who the people are and how much value they're really going to provide. Because similarly, like, like you mentioned on the counterpoint of maybe doing a self funded search, you know, you're giving up a lot in terms of economics for someone to write, write a check. And a lot of people can write a check. And so you, you want to, you want to partner with people that not only are going to be able to fund you and, but also provide a lot of that advice, you know, and kind of view search funds and acquiring a small business and running a small business the same ways as you do. Because if someone approaches this from like a private equity angle and says, you know, this person is no different than just like a hired gun CEO or something like that, and similarly should be given a smaller piece of the equity, you know, I think that's kind of it. Definitely it does not lend well to the searcher having a healthy relationship with, with that investor. And I think there are a lot of really great investors out there who are the right type of people to partner with. And I think Tyrell and I did a good job of, of finding those investors and partnering with them and we'll

Host: just give us a little bit more on that. Bob, what, how did you guys, what would you tell people out there about investor selection?

Guest 3: I think what we did really well was because we were looking to buy a blue collar business, we intensely kind of quizzed our investors to kind of flip the script on them, like talk about some of the blue collar businesses that you've, you've, you know, invested in. A lot of investors have kind of cut their teeth I think on a lot of the SaaS, software, healthcare businesses over the last decade or so. Tyrell and I knew we weren't going to buy one of those. So, you know, if, if that's something you're looking to do, like, you're probably not the right investor for us. We also asked some questions around, you know, talk about the deals that you didn't invest in, you know, the last five deals that you didn't invest in, why didn't you do it? And you know, you can kind of tease out some of those reasons, you know, and Say, hey, can I see the investor doing this? To me, is this something that would, you know, a year and a half in and I find a pretty good business here that I think we can make work and checks a lot of boxes for me personally, but that investor doesn't feel like it's a good fit for their portfolio. Do I really want to be kind of beholden to that or do I want to kind of set the groundwork at the beginning to be successful?

Guest 2: Yeah. And I think a lot of reasons why searchers don't end up acquiring a business isn't because they didn't find a good one. I think it's because they built a cap table that wouldn't work together to actually close on it on the traditional side, similar to self funded searchers not being able to finance it with sba. So design with the end in mind. I think rather than the prestige or the aum of whatever investor you have. I know investors get mad when searchers interview them, but I think a really helpful question to ask is tell me about a deal you invested in that was borderline. More likely than not, I'm going to find a business with two of three magic qualities. You know, recurring revenue, low customer concentration, low capex or low cyclicality kind of being those magic three. Like chances are I'm going to find one that's got two and I'm going to have to build the third into my business. Like tell me about one of those. And I think as the, the space gets more saturated with investors, you don't have to be a good investor to invest in a business with all three. Those deals will get done, you know, 10 days out of 10. It's more likely that you're going to have to pull together a cap table around a business that's got 2, 3, 3. So tell me about a time you did that. I think that's a good question.

[36:58] Host: Those are great guys. Those were, those are really helpful. Okay, well, let's talk about your interest in blue collar businesses. Why were you so focused on that category?

Guest 2: I think what's underrated about blue collar businesses is a lot of them haven't experienced the efficiency gains of the last 20 years or productivity gains that come to all these SaaS models popping up. By that, I mean, you know, our company for example, was doing payroll on paper still. Well, there's off the shelf SaaS products to help kind of add to those sorts of things. But, but they have a great core product that you don't have to redesign. You know, it's it's essential and they've got great people around them. So we saw it as really underutilized. Where I think there's this fear of searchers who usually come from the white collar world, and they, they fear that these employees will reject them and hate them and move on. But we kind of came from companies that had a blue collar background, so we didn't quite have that fear. But we knew there was still this big upside of bringing a little technology into it to succeed in the marketplace.

Guest 3: Yeah, I mean, to put a finer point, I guess, on that, that payroll example, because I think it's, I think it's a good one because you might say, oh, well, these MBAs just bought a business and they put a payroll in and they mission accomplished. But what that really does, that allows us to do is not only does it free up more time for our bookkeeper to work on, hey, let's improve the cash conversion cycle. Let's go after some of these efficiencies on the cost side by being able to put in a non paper payroll system, leveraging kind of the skills that Tyrell and I got from our previous experience that says, okay, hey, actually we're spending too much on this site. Our hours per student is 20% higher here versus this other site. So let's reconfigure the team, reconfigure the operating model at that site, and all of those gains go to the bottom line. But that's something that you don't have any visibility into if you just are doing everything on paper. So that that switch over isn't just like a cosmetic change. It is pure productivity that you, that you can inject into the business. It allows you to have better managerial oversight into a business that you know is spending a lot of money on people, but figuring out, okay, how can we get everyone kind of up to that best practice site that we already have in our organization.

[39:16] Guest 2: And there's productivity gains like payroll and stuff like that. Generally don't piss off your core group of employees in the same sense. Like, by that I mean, you know, you're not coming in and telling them, hey, here's how you train truck drivers better. You know, and I think a lot of people think of that with blue collar. It's actually a lot of the gains are on the back end of the system where the employees are already frustrated. That's like, why can't I get my paste up same day? Why can't I just open an app and get my paste up? And so like, you know, there is a little bit of like coaching the administration through change management. But I think you get to keep your core employees, you know, happy. You're not kind of me mess up

Guest 3: the special sauce there.

Host: That's a great point, Tyrell, that like, when you think about change, because we talk about change management, how difficult it is, how delicate it is, when to do it, etc, but this distinction between kind of front of the house and back of the house, where the front of the house stuff is like where you're, you're getting in there and trying to change the actual service that's being delivered and how much touchier that probably is and how much less equipped you probably are to be doing that anyway. Whereas back of the house stuff is kind of a taste like chicken sort of thing where it's like, you know, every business has a payroll system or not, and implementing that is probably going to be a gain that can be achieved. And yeah, and it's decoupled from what's going on in, in the service delivery, which is really where people are going to be territorial. Maybe that's naive. Maybe the bookkeeper is also territorial about how he or she does payroll.

Guest 2: But

Guest 3: anyway.

Host: And so, but by the way, on, on the question of my. One of my favorite questions about the. This culture difference between white collar and blue collar. I mean, you guys, yes, you have had worked in blue collar businesses, but you know, come on, you're a couple of Harvard, Harvard MBAs rolling into, into this business. How did that go?

Guest 2: Yeah, I think well, you know, it's still always going to be a struggle. You're always going to be kind of the boss. You're always going to be that. But I think one thing I like to remind people about blue collar businesses is that the, you know, everyone's afraid of, oh, it's all these employee issues. And I'm going to have to deal with, you know, all these different abuses that I wouldn't in white collar. But I like to remind people the measure of success is a lot more objective in the blue collar world. By that, I mean, you know, it's how many jobs did you get done? Did you show up on work? Do you have a good attitude? You know, the, the ways that you can kind of like quantify an employee's effectiveness I think is very clear. And I think that makes it easier to make decisions as a manager by this, I mean, you know, in the white collar world, if someone shows up, you know, 10, 15 minutes late every day, but does a really good job, you know, it's actually really, really hard decision to, you know, let them go or make changes or something like that. In the blue collar world, if they're showing up 15 minutes late to a job every single time, whether that's H Vac or class or something like, like that, well, it, it's a pretty objective decision as to what needs to happen or, or coaching moment. So I like to tell people, like, don't worry about that stuff. And if you think that any of the, like, you know, abuses aren't prominent in the white collar world, I think you just don't know the employee universe that well either.

[42:11] Host: Well, I, I had it pointed out recently also that we, that we overstate the difference between in. I think this is related to your point, Tyrell. The, the fragility of a business with 500 SCE versus 1.5 million versus 3 million. This person had been in businesses of all those sizes. And it's like the idea that you get to one and a half million or three million in EBITDA and it's a well functioning machine is completely naive. Like the dysfunction exists at that level too. But, you know, believe me. So maybe it's kind of also related to just like thinking that, you know, this one category of business, blue collar businesses, things are crazy, but in white collar businesses, everything is just, you know, like a finely tuned machine. Also naive. Bob, I think you, it looks like you wanted to add something.

Guest 3: I, I would just say also, you know, I, I think Tyrell's point on, on the kind of the objective measure of success is great, but I, I also think that there's a, a serious level of respect present, I think in blue collar businesses. Yeah, I, I think in a white collar business, you know, it is kind of hard to measure who's just kind of showing up and, you know, who's actually putting in a lot of, you know, hard effort here. I think with our blue collar businesses, what we found is especially the employees that are long tenured here, the reason they're doing this job is because they really care about it. You know, we, we, we work with instructors who have been here for 25 years. And I think that that shows, I think, a different level of commitment showing up to teach people how to drive a truck every day, maybe even so than someone who says, you know, I've been at the same, you know, accounting firm for 25 years or something like that. Especially when these guys who are truck driver trainers, they've got a really strong alternative of going out on the road and earning more money driving a truck. But They've chosen to stay at Transtec for a reason. And I think that's something that, I think that can't be discounted.

Host: There's lots of different types of blue collar businesses of course and you had decided that a men in trucks business was, was what you were targeting. Of course instead you bought a business that puts men in trucks. But, but I guess that is to say like manufacturing wasn't necessarily on your list. It was more kind of like you know, field crew type type businesses. What was that interest about?

Guest 2: Well, we like the ring of it when we pitched it to investors because it usually meant like some sort of B2B services business. You know, somebody going around route density problems like things that lend. Well in the search universe we obviously expanded that. I think we know Bob did a whole kind of automotive manufacturing look like supplier look as well. I did some oil and gas stuff too. So we, we didn't totally stick to that as well. But we, we did end up buying a company that puts men in trucks.

Host: You did also develop a thesis so you were, you were really kind of as traditional searchers tend to do more I think than self funded searchers really kind of going down rabbit holes and exploring industries, making arguments to yourselves and then presenting them to investors. And you developed a thesis around CDLs and training. Talk, talk us through that.

[45:18] Guest 3: Yeah, so I, I think how we stumbled upon CDL training was very early on we, we spent some days talking to people that were in the, the freight business. You know, I think early on in your search you look at a lot of really bad deals and I, I would say a lot of the trucking companies that we saw early on could be quantified as bad deals. You know, very cyclical, high capex, you know, seem to be trading at a high watermark given kind of the supply chain crisis over the last couple years. So talking to some of those businesses we, we realized okay, these probably aren't the ones for us. But we always like to ask owners, you know, what's the, what's the hardest part of your job? You know, what's the thing that you just can't seem to solve? Because I think that would point us at, you know, is there an opportunity to improve the business? You know, what, what's the next five years going to look like for this business? And at this point everyone was saying, you know, last summer we can't find any drivers. And so we're like oh that's interesting. You know, we, we kind of looked into the space and said okay, well who Trains, truck drivers. Is it community colleges? Is it, you know, Teamsters? Are there private businesses that do this thing? Pretty quickly we discovered, okay, there's this network of very small, fragmented, you know, one shop operations that do truck driver training. So if you're in Des Moines, Iowa, Des Moines, Iowa, you might have the local truck driver training school, but there were also these schools who had kind of seemed to achieve some kind of escape velocity where if 90% of the schools that train truck drivers are just kind of one shop operations. There are, you know, a handful of these schools that have, you know, three, five, maybe 10 plus sites. And so we, we talked to some of those owners as well, and what we discovered was, you know, economically, they're. They're great. You know, it's a, It's a instruction or it's an education business. So, you know, it's got really strong gross margins and I think, you know, a lot of operating leverage in the business that is, that is nice. So if you can increase enrollment, a lot of that falls to the bottom line. But, you know, behind that, what you see is this mega trend that over the next decade or so, we're going to have, you know, a million truck drivers leave the industry. The American Trucking association forecasts that there's going to be a 500,000 driver shortage in the next 10 years. And so you say, well, okay, well, that sounds like a bad reason to be in instruction. You know, they can't find people to fill these jobs. We kind of looked at it the other way. We said, hey, all these jobs need to be filled. There is a lot of reshoring going on as kind of trade patterns change. We were looking at the Southeast being kind of a beneficiary of a lot of these reshoring efforts. You know, more manufacturing, more warehouses. You just have to drive up I85. You see all these battery plants that are being developed. Those are all jobs that require truck drivers. And, you know, to put a cap on that, college is getting really expensive. And college doesn't really have the payback that it used to, especially for marginal students. I say marginal students. Maybe the thing of the bottom 20% of a local college, the kids that are going there, and they might, you know, take six years or, you know, go for a couple of years, drop out, and they've got a huge student loan bill. That is not a. The college promise. That is, that is being sold in high schools. And I think that that message, the genie, is kind of out of the bottle on that, and it's getting back to people and saying, hey, I need to look at a path that doesn't require college. You know, on the high end that could be like boot camps and you know, but, but I think we, we saw that trade schools fill a really big need there. So, you know, the combination of, okay, hey, truckers are kind of, you know, going to be in short supply over the next decade or so. We think that's going to cause wages to go up. So what does that do? It increases the value of an education and it lends more people say, hey, you know that, that trucking job that maybe paid 45 grand a couple of years ago. Well, if they can't find people now it's paying 75, $80,000 and I'm getting a signing bonus. And as a someone who maybe has a high school diploma, that's a really attractive thing. And you know, we, we wanted to be the, the per the school that

[49:39] Guest 2: provided that I know, to add on, we, we played up the like the countercyclicality of vocational training. Like, you know, if you look at the macro conditions and you go, wow, we're headed for a recession or, or something, you know, these signs are in the water. You know, vocational training is, is kind of the place I think millennials will snap to when it actually comes time to, you know, put food on the table. You know, when you're, when there's no more jobs where you can ride a slide down at the Twitter hq, you know, you might have to drive a truck to make ends meet or something like that. So we think it's, it's pretty recession resistant and we've noticed that too as kind of labor market has loosened up a little bit. We get more phone calls.

Host: Well guys, so it's, this is fascinating because you're really hitting upon a seismic, potentially seismic change in the workforce and a cultural change. Not to, not to belabor this, but as we all know, college became something that everybody needs to do over the last, I don't know, generation or two. And now we're realizing first of all that there's a shortage of people to do the trades in blue collar work. And second of all, that that was probably wrong headed to begin with. Not everybody needs to go to a four year college if for no other reason than the ROI isn't even there, but many other reasons as well. But to see that pendulum swing back, that's a big bet. I mean, tbd, I mean we're all talking about that, but that is a big bet. And it's not one that you're going to see unfold, you know, from now to 2028. Like, this is going to take a generation to work itself through, if indeed it does even work itself through. So, you know, and you guys are probably on a little bit of a tighter timeline than that. Can. Can you. Can you respond? I mean, our trade school is really going to be the thing in 2027. I mean, it. Will it move that quickly, do you really think?

[51:25] Guest 2: You know, depends on the macro environment, on how quick it moves. I think that's the easy hand wave there. But I. I think we've already seen it in the marketplace where, you know, our phones started ringing off the hook when UPS raised truck driver wages and they had a big headline that said, you know, top pay like 160 grand, 170 grand. So I think, you know, the underpinnings are already happening in that space. I think, you know, the biggest question we got is, what do you think about autonomous trucks? And Bob and I, you know, think that's still a ways out. That's not a, you know, a 2027 kind of, like, solution. Now there's no drivers in the cabs, and. And we see it as this really essential piece, you know, like, why. Why is the price of milk going up? You know, it's all. Well, also, we're paying truck drivers more, you know, because there's a shortage. So we saw it as this essential piece. You just can't replace overnight either.

Guest 3: And I would say to that as well, it is a big bet. But in the interim, we have companies beating down our door for drivers, so we can wait for the market of people to say, hey, this is a great opportunity. But on the flip side, I think one thing that Tyrell and I have really focused on this year, and I think we've done a pretty decent job at it, is answering those companies calls where we say, hey, you know, we need 100 drivers this year, and we have a ton of people who are reaching out to us about applying for a, you know, a big grocery chain or a big, you know, warehousing operation or something like that, and we got to get them CDLs or, you know, I've got a bunch of guys who work in a warehouse who don't have their cdl, and I can't find anybody who does have one because that change maybe hasn't happened yet in the. In the wider market at the very least. Well, you just train all of my guys. For me and for us as the CEO school, that's still. That. That's Even better in some ways, you know, and we think about our school and some sometimes as a, as like a matchmaker. You've got people who have this aspiration to, you know, upskill, make more money in their life, find a great job on their side. And you got companies who want to find that talent. You know, just like hospital systems have that, that desire to find great nurses. Just like, you know, software companies have a real desire to find great software engineers. The same thing exists for, for trucking companies and maybe even more so. You know, they are desperate to find safe, professionally trained drivers because they are just, they are so important.

Host: This is where, where I asked that obnoxiously smart sounding question, you know, are CDL schools really just, you know, are they, are they recruiting agencies masquerading as educational school? You know, you know, you're not, you're not in the education business, you're actually in the recruiting agency business. Is that, but is there, is there some truth to that? That really it's kind of, I mean, you just said you're kind of a matchmaker, which is what recruiting agencies also do. How do you respond?

[54:16] Guest 3: I think some companies do do that. You know, I think Transtech we can be. If you're, if you're a student who wants it all, you want the training, you want us to find a job for you. You want us to then check on you in six months and find you another job because you don't like the job that we put you in the first time. We can do that, you know, so, so I think we can do that really well. I, I think maybe the, the, the better read into it is we give students who don't have a lot of options or people who are making not that much money, who have never really had a, a really good path. We give them a path, you know, we, we, we give them the, the training that says we're going to put you into a really big industry that has a lot of different ways to, you know, to play in it. And you know, like the CDL training is just kind of that, that gateway to getting there. You know, if you're a guy who has a high school diploma and making $25,000 a year working at a local construction job, you know, we can get you a CDL and you'll be making 65, $70,000 right out of school, and then in two years you can be making $120,000 working at Amazon or Walmart or, you know, UPS. So, you know, I, I think we can, we can do the the recruiting and the staffing part of it. But I think what our students come to us for is that, that independence

Host: and those options and to be clear, just about cdls. So is it because it's all manner. So you mentioned Amazon. So, so you know we're in ups. We have Amazon and UPS trucks driving all over our neighborhoods. Of course those aren't big 18 wheelers. Those are much smaller trucks. So is there just kind of a, a blanket CDL or are there different types of CDLs? And so, so is it always necessarily about driving like a big rig 18 wheeler? Is that the same training as somebody driving a school bus? Same training as somebody driving a brown UPS truck? Or how does that break out real quick?

Guest 2: Yeah, so the, the class system's based on, on weight and the, basically the layout of the vehicle. So class A is those tractor trailers. So that's kind of your, your maximum amount of training. Basically every state in the United States it's going to take you 160 hours to do that is the state minimum, though some programs will run even longer. So that's kind of your tractor trailer. That's what everyone thinks about with truck drivers of which Amazon has a whole fleet of those and so does ups. The last mile delivery trucks, it depends on the weight. And so big box trucks like the maximum size U haul you have, if you loaded that full of lead would actually fall into what's called class B. And so that's your weight of an attached vehicle. So garbage trucks fall into this, passenger buses fall into this category. Other things like that. Most of those delivery trucks you see like the Amazon trucks without kind of the driver's side door for them to jump out, those aren't commercial vehicles and so they don't fall into A or B. But there is a ton of vehicles that fall into the B class as we're discovering as we get more into the business. The other interesting piece is the, what's called the passenger endorsement. So in those, in those cases where you have more than 16 passengers you need to have trained on a vehicle like that. And why that, why that's important is because there's so many school buses out there, coach buses, all those sorts of things. And it means that those class A drivers that train on a tractor trailer can't go do that job unless they train on, on a passenger vehicle. So it kind of, it's this, it's this problem that exists that you know, perpetuates the school bus driver shortage and

[57:33] Guest 3: all this other thing.

Guest 2: So and class B, I'LL mention, kind of varies state to state. Whereas class A is, hey, four weeks, no problem. North Carolina, it's four weeks. Class B anyways, which is kind of crazy. Other states, it's only two weeks. So it depends state to state what class B looks like.

Host: Okay, well, so we're talking about all these kind of different types of ways that somebody might use a cdl. And I think, Bob, you mentioned, like when you were talking to other business owners about, you know, in kind of men in trucks businesses, they were all complaining that they couldn't find people with cdls. And yet it does feel very tied explicitly to the trucking industry, like big rigs, 18 wheelers. So, so, so does that actually comprise kind of most of that. Most of your customers are people trying to become big rig truck drivers. I mean, how, how coupled to the big rig trucking industry is your business.

Guest 3: So I, I think a lot of the students that approach us that are kind of paying their own way want to become a truck driver. You know, our prototypical student, and I say most, I would say 75, 80% of them probably want to drive a, a big rig. Most of them prototypical students would say, my dad was a truck driver, my uncle was. I had a brother who came to TransTech, and he's having a good time out on the road, he's making good money. So that's why I wanted to. A lot of the reason for that is the pay is better, the optionality is better. It's not just kind of that over the road where people are away for a couple weeks. You know, you could get into a company that has kind of a dedicated route, and you might just be driving from Charlotte up to Richmond and back every day. And, you know, you make $110,000 a year and you got your own truck and you never have to sleep in a, in a rest stop. And I think that, and that's a pretty good option for them. I would say the, the rest of our students, you know, want to work for the Charlotte area transit system. Cats, you know, they want to, they want to drive a, they want to drive a bus, potentially. They might want to drive a, you know, a dump truck. There's a lot of dump. There's some dump trucks that require a class A. If you're working at like a mine or something like that, you know, they, they look at those jobs like kind of in the hills of North Carolina, and there's a lot of those out there. But I, I think a lot of the employers that we see sponsoring Drivers to us kind of fall outside of that, that 18 wheeler in, you know, industry. They're not the big, you know, long haul truckers. These are companies that are tree removal companies. They are, you know, I would say like the school bus districts. You know, they run, they run transit systems, they, they run kind of waste hauling, things like that where it requires a class B or maybe a class A if you're like a utility company and hauling and have a trailer behind you. So there's a big, you know, addressable market out there besides kind of the, the classic 18 wheeler market. The reason why 18 wheelers and kind of long haul is such a nice market to serve into as a training provider though is These companies hire 10,000 drivers a year because there's like 100% turnover in their driver pools. So they're always hiring, there's always a need to fill drivers there. So students see that and they see a pretty attainable path for them.

[1:00:46] Host: Go ahead, Tyrell.

Guest 2: Sorry. Yeah. To add on what Bob was saying, I think employers are recognizing too, having kind of more versatility between your employees is better. So we get a call from, you know, a lot of public works departments who are like, hey, I've only got one commercial driver and when he's sick, our crew's down, you know, no one could go unclog the street train. So why don't we train his helper and also get him the cdl. Amazon's model is also kind of like that where you know, a lot of their warehouse kind of switchers can also do a short haul as well. So I think there's a lot of value that companies can get for having non, you know, full time drivers still be licensed.

Host: Part of the reason I'm digging so deep into this guys, is because I just, I got off our pre call and I just loved, I loved the business. Promptly went to Google Maps and searched for, you know, CDL license schools, training schools around my area. And just like you said up here, up here In Northern Virginia, D.C. area, there's tons. And they all appear to be very kind of small. Not tons, but there's a lot. And they appear to be kind of very small mom and pop operations. So I'm here, I'm, you know, I'm sitting here stroking my chin and, and so one of the things you just said, Tyrell, is like, you know, getting. You've now both touched on the fact that you serve end customers who are people who aspire, typically aspire to be a long haul truck driver and then you serve Businesses who are getting their employees skilled, skilled up. What's the split? What's the split? First, just really quick, really briefly, it depends.

Guest 2: Last year I would have told you, you know, 40, 60 for business to consumer. And that rides a lot on the freight market this year I think Bob, you know, correct me if I'm wrong, It's probably like 80, 20. It's tough sometimes to discern what's actually a business because you might have a cash pay come in, but, but it's really an employer that has two employees. We would still consider that like an individual versus a, you know, here's a contract 50 driver kind of thing.

Guest 3: Great, thank you.

Host: And then I'm just curious about the opportunity in the, in the fragmentation and how so many of these operations are mom and pop around the country. So now talking to myself and talking to other searchers out there who might be, who might be intrigued by this industry as well. When a business, a corporation needs to scale up a bunch of, a bunch of employees with CDLs, I assume that you have a competitive advantage in being more of a professional operation that they'll want to work with a trans tech rather than, you know, Bob's CDL parking lot. Is that, is that true? I mean are historically, are the, are big corporations really working with really kind of, kind of these tiny mom and pops to get their people skilled up?

[1:03:21] Guest 3: No, I would say they typically don't. If you think about the big companies, the ones that you would know the names of these companies, they look at Transtec and they say this is an operation that has eight branches around the state. They can touch, you know, everyone in the state that wants to become a truck driver is, it should be within an hour drive of the Transtec branch. And also kind of that professionalization, you know, our sites are, they're bigger, they're cleaner. We've got more instructors, we've got more third party CDL testers than, than anybody else in the state. So if you're a business and you're looking to kind of do that end to end service, you don't want to know or you don't want to have to know that the local CDL operation, well, they only start a class every, you know, month or every two months or something like that because they only got two instructors. TransTec, we've got, you know, 40 instructors. We start a class every Monday. You know, we can slip seat the guys in there. We've got an online CDL training program that we've, we've, that we've got so we can kind of work with the employers and we've got a great recruiting and sales staff that helps meet the flexible needs of those employers that can't afford to lose 15 guys all at once to get their CDL, but they want to get all of them trained. So how do I schedule those in? If you're a community college, if you're a small operation, it might take you a couple months to get them all in. If they can even manage that for us, we can get those guys kind of knocked out in a way that works with the employer schedule as well.

Host: Yeah, so. So a lot of competitive differentiation for you guys comes from your size and scale. I want to keep hammering on kind of the industry overall and also talk more about just trade schools broadly. But we haven't talked about Trans Tech directly yet, so. So let's do that. The.

Guest 2: You.

Host: You had it on your whiteboard and then you actually. And then you actually got your hands on it. So tell us the story there and then tell us about the business. More bullet points about the business, particularly in numbers, you know, revenue numbers and employee numbers, if you could.

Guest 2: Yeah. So we, we ran a bunch of proprietary outreach, kind of. Bob, you know, asked the question of these freight folks. We start looking into schools. We do some, you know, Googling, we build a list. And so that kind of led us in the direction of Transtec and a couple other schools. So it was on our board, we wrote it down, we reached out to them, and they just ghosted us, you know, and we were like, hey, you know what? Whatever. This happens 200 times a week with. With our proprietary system. But turns out they were preparing for a sale, so it ended up being a broker deal. And so I was on interacto one day and I saw it pop up. It was, you know, top deal there. I clicked it, I sent it to Bob, I said, do you think this is what I think it is? And he said, yeah. And we got. Got the same worked out with the broker and then kind of, you know, the rest is history. Great.

[1:06:04] Host: And was the seller surprised to see you again after. After. Have you had some interaction with them? Then they ghosted you and then you popped up again the moment the same hit the market.

Guest 2: I don't know if they remembered us. Maybe. Maybe we had junk mail. Maybe we had something. I don't. They weren't like, hey, you know, we remember you. We got to know them kind of more over the deal process. But yeah, we probably are in a deleted recycle bin email somewhere.

Host: Oh. So when they when you say they ghosted you, you never got a reply. You had never had any interaction with them at all.

Guest 3: Okay, gotcha.

Host: Okay. And so give us again, please, a picture of the business. You've already said, I guess, 40 instructors locations all over North Carolina, but give us some more bullet points again, please.

Guest 3: Yeah, so the business is about 7 million in top line, or when we acquired, is about 7 million in top line, about 1 and a half in EBITDA. And we acquired it for about 5 ish times EBITDA. The business also in terms of growth over the last couple years, 15 to 30% annual top line growth over the last couple years, a lot of, a lot of that through kind of new site expansion, a lot of that through new customers that they've brought on and just some of the kind of the macro growth. I think what we've seen even in our tenure running the business is it's pretty easy to talk to more people in North Carolina. From a marketing standpoint, investing in that has a really nice payback.

Host: What do you mean talking to more people in North Carolina? Just increasing the marketing, increasing the marketing,

Guest 3: increasing the marketing channels. So, you know, working with businesses to, to find their employees, but really directly just saying, hey, we've got a new branch opening this side. Start investing in radio, investing in digital marketing, things like that. Really easy for us, I think, to turn that knob and uncover a lot more opportunity. So even beyond that 15 to 20% growth rate that you saw over the last couple years, you know, you can think that it's a really nice direct payback. When you invest in marketing, you see lead flow kind of jump up with that. So the tam's even kind of bigger in the state than I think we thought when we, when we acquired the business.

Host: Well, I, but I do have to push on the, the historic growth of the last couple of years because of course, trucking benefited enormously from COVID So those growth numbers in your own mind, you know, are going to probably cut if you did nothing. If you did, if you didn't amp up your own marketing, those numbers would probably recede some. No, I mean, and by the way, the trucking industry, the headlines today for the trucking industry are not great. So for this exact moment in time, it seems to be suffering now, as you said, it's a very cyclical market. So address all of that, please.

Guest 2: Yeah, I think, you know, back to the comment of finding investors that are willing to invest in a business that has kind of two or three magic qualities, I think that's Something we address every day is yeah, the cyclicality of the freight market is something Transtec needs to move away from long term. You know, we, we need to be able to serve those customers when times are good. But I think if we hang our hat on it, you know, that that's going to pose trouble for the business. So I think our focus has been, well, you know, let's focus on some of these non cyclical CDL requirements like school bus operators and you know, waste collectors and those sorts of things as well. So. You're absolutely right. Well, you know, part of that growth is spurred on when you know, sun shining there, you're making hay. But we want, we want to make sure the sun's always shining. Training, not just when there's a supply chain disruption.

[1:09:28] Host: And so that sounds like it would be a pretty big strategic move as new owners would be to diversify where who you're training away from over reliance on the trucking industry.

Guest 2: Well, the federal government's also helped us out a little bit with some regulation too. So like it's not, you know, Starting from square one in 2022, the federal government introduced some legislation that made it harder for employers to train their own employees, especially in that class B market. So I think there are, you know, there is a lake of employers right now that are saying, well how the heck do I run a training program? Do I even want to run a training program now that I've got these extra compliance requirements? So you know, one thing that excites us about the business is potentially moving into the kind of that compliance management space or being that, you know, white label solution for a company that wants to train drivers that would, that would kind of fill out that three of three we're looking for in a business

Host: and trans. In terms of employees, Bob, I think you'd mentioned 40 teachers, instructors and then I assume you've got 10 or 15 in kind of back office. How many employees are there at the business?

Guest 3: Yeah, I think we have 68 employees actually. So, so we're, we're a little bit more I think on the back office than, than the number you quoted. But a lot of that comes from, you know, we've, we've got recruiters that are staffed kind of for every branch knowing the local market. And so that, that's a, you know, I think we've got seven now and then, then also you've got kind of the compliance, safety, operations, management that take a, you know, there's a couple more heads there and I think that's something that, you know, Transtec, I think, does really well and is a differentiator versus some of the smaller ones. You know, when you look into the. The local CDL training spaces, those names change a lot because there are a lot of schools that, you know, don't run things by the book. And I think that's one of our competitive advantages, is that we're able to say, hey, we're providing a, like, certified, audited, you know, DMV compliant. We've got a great relationship with the DMV training regimen. A lot of schools kind of cut corners. And I think that's why employers kind of shy away from them some, in some cases, because they know if they're going to transect, they're getting all their hours, they're, you know, going through the ringer. You know, they're. They're going to have a really robust training program. Program that you might not get at a. At a smaller school.

Host: Bob, what did you mean, seven recruiters? Recruiters are salespeople bringing in.

Guest 3: Okay, that's right. Not salespeople. Yeah.

Host: So getting. Not getting them placed. Not like placement people at local businesses.

[1:12:03] Guest 2: Right?

Guest 3: Yeah. So it's probably distinguished from our conversation earlier around recruiting, but yeah, so these are our sales staff. So you talked about kind of, you know, pivoting the business or kind of a strategic change away from relying on corporate business, you know, from the big carriers who, like you mentioned, are kind of cyclical with. What we saw with our recruiters was, hey, we've got so much inbound demand from people that are individuals looking to sign up. But it takes. There's a little bit of sales process there, you know, doing discovery on, you know, what are they looking to accomplish? Like, do they have the money now? Are they looking to get it matched up with an employer? Are they looking to get their class A versus class B? When we started, we had two recruiters, and they were kind of fielding all of the inquiries across the entire state. And as you can imagine, you know, hundreds, you know, a couple thousand over the course of a year. And you can't really build that relationship in the same way that you could if you had a bigger sales team. And so what we've done is we said, okay, as we turn up the dial on marketing, to talk to more people on the, you know, cash pay side, these individual students, we got to have more recruiters, we got to have more sales staff to have those conversations and actually sign them up. You know, these are. They are salespeople. You know, they're. They're they're commission based, but you know, it's, they're, they're really selling an aspirational product here and then they need to understand kind of the person's individual circumstances and coach them in making a big life decision. So, but that's, that's who our, our recruiters are.

Guest 2: And I think anyone who's, you know, kind of enrolled in, in post secondary vocational training, like there's so many barriers to actually just showing up to school. You know, I remember just like trying to figure out where to pay my tuition was just a pain, you know. And so I think that's what we call them recruiters because there is a sales element, but there's also an element of removing these barriers. Other schools will call them admission staff too, of understanding. Okay, well, you know, how much do you have put to put down towards it? Is there, you know, how can we get you into school? How do you know, is it your schedule that prevents you from coming in? Like, how do we set up a plan for you to get here and get your cdl? And so I think that that's an added benefit rather than just, you know, a used car salesman slapping the top of a roof. It's, it's someone who's there to help you kind of navigate your way to get to training.

Host: Reminds me in SaaS world, the, the concept of customer success, you know, it was always, it was always called customer service, but then this notion of customer success came along, which was like customer service plus, where you're really gonna, you're really gonna help your customer be successful with the tool and kind of really hold their hand and, and, and guide them into. Sounds like kind of a similar thing for your recruiters on this point about this being a big decision. This is also a big investment. It's thousands. Can you, can you share what your list price is for, for your, for your various options?

Guest 3: Yeah. So we are $4,500 for a Class A and we're 3, $500 for a Class B.

Host: 3500 and 4500. So we'll just call, we'll average those, call it $4,000 for people at, you know, the socioeconomic end of the spectrum that are not MBAs, let's just say. And indeed, like you guys said, this is aspirational for many folks. I mean, they're, they're looking at this precisely because they don't feel like they're earning very much money. They're not earning very much money and they want to earn more. $4,000 is a lot to anybody but probably or certainly more so for people at this end of the spectrum. And it's not a recurring business. So you couple, you couple non recurring and you know, a big spend for people who don't have a lot of discretionary income. That's challenging. I'm just talking my. It's very clear why the recruiter, why you've gone from two to seven recruiters, let's say no. But, but how do you deal with that challenge? That's probably not probably. I know from our pre call that's kind of one of the, kind of the key, maybe not weaknesses, but challenges in the business. So how are you guys thinking through that?

[1:15:55] Guest 2: Yeah, there, there is some federal support and so that is a help for, for folks that, that can't meet it. But albeit I think it's the biggest missed opportunity in legislation in the United States right now. By that I mean the payback period is so quick. When you think about, you know, state funding for four year degree programs and kind of what the income yield and like tax yield is. You know, Bob and I have done the math for the state of North Carolina. It's like a 1.6 year payback which is certainly not the case when it comes to post secondary education. So that component we, you know, we love to kind of lobby drive more for that on our side. Opening up financing options is something that we've been working through too. It's a tough end of the market to service. Default rates are higher, so companies, you know, want to charge higher interest rates. So you know, our careful decision making is how do we, you know, come up with a package or some options that students aren't being, you know, induced into some predatory lending environment. So we're really working to, you know, find a partner that can set that up. The third way is kind of playing matchmaker. Like Bob said, there are companies that will pay for your tuition for you to come through school, albeit it comes with a, you know, a service requirement, you know, either kind of one to two year service requirement. Typically those jobs are over the road. So those admissions folks will walk through kind of those steps along with cash pay. You know, we, we like to say, hey look, if you're doing this for your freedom, for your independence, the best thing you can do is put cash down because it means you don't have to navigate the, the myriad of qualifications for government funding. It doesn't mean you have to sign away two years to go over the road. If those are your only options, then go do them. You know, but, but otherwise pay cash.

Host: But the two year over the road commitment thing sounds like a good deal in that you're also getting a guaranteed job.

Guest 3: Absolutely.

Guest 2: Yeah.

Host: So, so that doesn't sound like a con. That sounds like a pro.

Guest 3: You know, I think, I guess it

Host: depends if you want to be an over the road. Maybe you're getting a CDL for a different type of job. If you don't want to be a long haul truck drive trucker, then that's not appealing.

Guest 3: You know, we try, we try to coach our students on this. It is a, you know, it's, it's a pretty good option for your first role. You know, I think it is harder to get hired as an inexperienced driver. There are insurance challenges if you're a, you know, small to medium sized company that, you know, might preclude them from hiring people with less than six months of experience. You know, what we tell our students is that the first job out of school is not your forever job. You know, you're not, you're not marrying the job here. What you're doing is you're getting paid while you're doing it, you know, between 60 and $70,000. Typically you're getting that really valuable experience. You know how to really, you know, how to do your electronic logs, how to back up to a gate. You know what it's like actually working for one of these big companies, how to be places on time that you can take those skills, get some of your tuition paid back. Because all the companies that we work with, that we place students into, offer tuition reimbursement. So they're paying you back, you know, 200amonth towards your, your, the cost of your tuition after six months, a year when you feel like, hey, you know, I'm tired of kind of being over the road and maybe being gone for an entire week at a time or, you know, I've got another option. What we found is that truck drivers are kind of a flighty bunch, or I should say they're very opportunistic when new opportunities come along. So they're not afraid to jump to the next spot, that they'll pay them a little bit better, give them a little bit better work life balance, which, you know, we tell students that that's, that's always an option. So I think that's what still makes it very attractive.

[1:19:12] Host: Circling back to kind of your thesis or what you observed in the market of CDL training was that highly fragmented, but that there were a couple of big players. So you saw that there Was there was a couple of examples of. There was the potential to get big because others had done that before you. If, if just a small handful. Trans Tech is already a probably you'd call it a medium sized player. Like it's much bigger. It's big in North Carolina. It's bigger than all the mom and pops. It's just not yet a national player. Did it grow through an acquisition or did it grow organically? How did it get to its unusual size?

Guest 2: Yeah, organically and you know, a lot of hard work I think from the, you know, the, the team before us as well, in the sense, I think, you know, Charlotte's a great market first of all, for, for truck drivers. It's this great intersection of kind of, you know, I 85, 77 and the Atlanta to D.C. kind of, you know, route. So I think naturally that's a really good home base. Their second branch was up in the, in the Hickory area, which was kind of the former furniture capital. Still makes a ton of furniture, but they had a lot of displaced workers I think in the early 2000. And you know, truck driving is a great alternative to that coming out of, you know, manufacturing base. So that was kind of like the next location they opened. So for the most part it's all. It's been organic. And then, you know, kind of added Asheville, added some of the community college partnerships as well. And so that kind of grew some of their, their branch and geography. You know, I think in the past they tried kind of South Carolina, but the benefit of staying in one state as you work with one regulator, 1.1DMV. So I think that was why, you know, towards the tail end of their career, our sellers had said, hey, like let's, let's make this easy and just stick in North Carolina.

Host: Is part of your eventual, eventual growth plan to expand other states?

[1:21:00] Guest 2: Yeah, I think we still have some white space in North Carolina first that we'd like to tackle. But certainly I think the Southeast like Bob mentioned, you know, has a lot of regional kind of tailwinds to it. And so certainly South Carolina, Virginia, you know, Georgia, those are, those would be great places for us to expand.

Host: And what are the tailwinds for Southeast? Why? It's just because kind of the macro economy down here is just kind of surging.

Guest 2: Yeah, I think Bob touched on a lot of the reshoring and manufacturing. Like it's coming into South Carolina. You know, they're building cars in South Carolina battery plants. North Carolina, it's, it's got a great population. I Think it's attractive to those companies. These are genuinely non union labor forces. So when they're relocating, they're coming down to this area. I think also in the Southeast there is kind of a view towards vocational training and truck driver training that's maybe a bit more familiar to other folks than other parts of the country. So I think it benefits from that as well. It's also GDP wise, it's probably the fastest growing quadrant in the United States.

Guest 3: Great guys.

Host: Well, we're wrapping up here, but there's still some questions I want to get to. But before we get off of Transtext. So it was 7 million top line, about a million and a half EBITDA. That is a little bit smaller for a traditional search. When you're a partnered traditional search, does that mean you look even bigger? Is that, would that be kind of the logic?

Guest 3: Typically? Yep.

Host: Okay. Okay, so it's a small one for on two fronts then a smaller one than you were probably targeting. But you just answer, I assume is you just liked it enough that you were willing to make an exception.

Guest 3: Yeah, yeah. I think looking at the growth trajectory, looking at kind of the macro thesis behind it and all the things that you mentioned in kind of the fragmentation side, what we saw was Transx, a business that trains in 2022, 2000 drivers. It's the biggest player in the state of North Carolina. You look at the United States, there's something like 600,000 CDLs that are issued per year with the, the largest CDL trainer in the, in the country training about, you know, depending on the year, between 15 and maybe 25000 of those. So there's a lot of, of opportunity to go out there and consolidate either through you know, organic expansion. It's not that expensive for us to open a new branch given kind of what we, what we have in, in our back office staff to support that or to, to acquire, you know, like to acquire some of those small, medium sized ones. But the thing is it gives us kind of that optionality to grow in both of those ways. Tyrell mentioned that it is nice to work with one state regulator, but all the rules in terms of CDL training, they rhyme because it's kind of a federally regulated space.

Host: And so you guys acquired in 2020 this year.

Guest 2: January 2023.

Host: January this year. Okay, well here comes one year anniversary and have you just quickly give us a picture on revenue growth, not growth. J Curve. What, what are things looking like almost a year into this project?

Guest 3: I, I would say we, we saw a pullback in the corporate market, like as you described, you know, it is a little bit more. It's not a great time for. For the. The corporate carriers and that. That kind of manifests itself in less training support on the individual side. You know, we have kind of continued that. That growth path. You know, I think by investing in more recruiting staff, investing in more marketing, you know, we. We've kind of continued that trajectory. Trajectory. In addition, we've opened a new branch this year and moved our headquarters kind of from the Hickory Market, which is about an hour north of Charlotte, to Gastonia, which is about 30 minutes to the west of Charlotte. Kind of in a new manufacturing warehousing space. There's a. A couple million square feet of logistics space right around our building. So, you know, I think that presents itself really well for a really strong 2024.

[1:24:51] Host: Well, it's one of these where, you know, if you guys can soldier through this. This really inhospitable trucking market, you know, you'll. It's kind of a bit of a stress test for year one in the business. I. I would imagine. But as I said ahead of our call today, I was doing some Googling and people are talking about the trucking industry is not being in a good place now. And of course, you know, even the layperson probably saw yellow, which is one of the big names in trucking, completely shudder. I don't know this summer, which was. I don't know how many thousands of truckers. But. But. So you are feeling it, but it's not catastrophic.

Guest 3: That's right. Yeah. And like you, like you said, you know, if we can survive this, which we will, you know, we. We can survive anything. But it also, it. It forces you to. To pull forward plans on. On growing the business that you would have said, oh, well, on the first year, we can kind of rest in our laurels and, you know, and. And you know, clip our coupon and, and make plans for. For next year. It's like, no, this year we got. We got to grow. We got to, you know, we got to invest in the team. We got to rethink things. We got to shift away from being too dependent on the cyclical parts of the business and invest in the. In these parts of the business that have this huge TAM that hasn't been been touched yet. Right.

Host: Well, it's also like. Is probably uncomfortable and maybe even scary at times as it is. It's like, you know, the. These times of. Of. Of weaknesses in industries are also times where if you, if you. If you have the Resources in the stomach, you can really pull ahead because you can, you can kind of start gobbling up market share where, where weaker players are getting out, shuttering, whatever, having a harder time. Guys I want to ask you about so I want to zoom out now as we close just to 2, 3. Still got three topics to go here and are all kind of like higher level topics. The first is just the trucking industry. Not what we've, I've already been you know beating on here for so long but you just the trucking businesses like routes so, so you see these FedEx routes, Amazon routes, you see traffic other I guess long haul style trucking businesses on biz by sell a lot. It seems like these businesses really transact a lot and that there are a lot of them. And you talked about at the top how you looked at some of those, didn't like them. Give, give us just you know, 90 seconds on should, should searchers pretty much stay away from those businesses? What to look for if or not but you know what to look for.

[1:27:17] Guest 2: Yeah, I think it's tough because we're like wow, these businesses are zero of three magic qualities. They're high capex, they're cyclical, they're non recurring revenue in most cases. So our investors go whoa, stay away. But that's not to say you can't carve out a niche. I think at one point we looked at milk delivery or milk haulers basically the tanker trucks that go and pick up milk from farms. We talked to the biggest transporter in a certain, a certain state I can't mention. But that's great business because that's you know, that's recurring. He didn't have churn in his driver's turn so to speak. Milk, milk funds but, but there, there are niches that I think are really good in that market. I think Stericycle obviously gobbled that up in, in the medical disposal field as well. So that's not to say they, they all can't be I think dry van like spot market companies. Absolutely. Stay away, you know, stay a mile away. Pitfalls there I think is the asset base. It's really hard to tell, you know the quality of the assets that are underlying it. You can hire you know, staff to go out there but also remember that these are bouncing around the country all the time. There's not a yard where they're all sitting at one point where you have one person go check them out. You can do the VIN numbers and stuff like that. But you know past I want to say the the warranty piece of the trucks. Like it's totally dependent on the maintenance program that the, the company is running. So there's a lot of risk in those businesses and I think we, we were smart to stay far away from them.

Guest 3: Great.

Host: Thanks for that, Tyra. That was perfect. And then the other big question I wanted to ask you is so, so we talked about what you say, this sustained and probably growing demand for cdls because you know, you know, the need for everybody to go get a four year traditional college degree kind of receding. The, the shortage of the, the shortage of truckers causing prices to go up and the cultural shift that these are jobs that are going to be appealing to people who might have otherwise, you know, gone, gone and gotten a four year. But you guys landed on CDL training. But there's all kinds of other trade schools like you know, plumbing trade schools and H VAC trade schools. I mean just go through the trades and those trades don't have the cyclicality of trucking or some, or some of the other things that you're, you know, the industries that you're really kind of pretty attached to do. So why did you look at other trade school, trade education in industries that have flatter and less cyclical, you know, sales patterns?

Guest 3: We, we did and I think what we saw there, like you said, they, if you found a private school that did, you know, plumbing training and things like that. Yeah, I think it'd be, I think be a great investment all things considered. What's different about you know, plumbing, H Vac, the line or like linesman, things like that? These are trades that in some cases are done a lot of the times by the employers. It's kind of an apprenticeship model. You know, you don't have say the, the same volume I think that you do with, with truck drivers. The, the challenge also is that you're competing with the community college system. In a lot of cases we do compete with the community college system a little bit. Our program I think is more tailored to kind of the students actual goals and desires of four week courses and things like that. Most community college systems set up their CDL training to be 12 weeks, 18 weeks to comply with kind of federal requirements in order, you know, without getting into all of it. That's how they get their money is by having a longer program. Plumbing it has to be a longer program. Electrician training has to be a longer program. Auto mechanics, things like that are. These are longer programs. And so the community college system can run at a loss. You know, state regulator, state Legislators are happy to keep funneling money into the community college system despite the fact that, you know, they might not have the best customer experience. I think, and I think that's a lot of the reason why, you know, truck driver training has also moved kind of towards the private model. But you know, I think that's what we saw in some of these other trades was heavy community college influence and also kind of employers that, that have taken on a lot of the training in house and maybe just train one, two guys and make a one to two year training investment in them.

[1:31:34] Guest 2: Still great business though. I'd encourage searchers to go look at the vocational training space as well. It's all those macro trends. But we certainly love CDL for the reasons Bob mentioned.

Guest 3: Great, thank you for that guys.

Host: Tyrell, you mentioned at the top that you're Canadian. Talk to my, talk to my Canadian listeners. What should they know about being a Canadian searcher, buyer, operator of businesses? I kind of don't even know what to ask, so maybe you can fill in the blanks for me.

Guest 2: It's a lot harder to win over owners in the Southeast, you know, talking hockey. That's, that's for sure. You gotta, you gotta pick up some football lingo. So luckily Bob carried me, me through those, those discussions as well. But you know, part of the, the traditional route is it is a great path for, for a visa to the MBA system is really good at that. You know, the extension visas you're able to get to go work while you search is helpful. So I didn't have any problem. I also married an American during the process for a lot of other great reasons. But you know, one, one advantage to that is, is work visas as well. Canada's got, you know, a good reputation of being a friendly neighbor. So it wasn't a hindrance in any way. I don't think. Unless you know, Bob and the sellers were laughing behind my back about my, my accent. Sometimes that'll come out and hear an A or an about or something.

Host: But yeah, probably would have. A lot, A lot of Canadian searchers that have reached out to me are curious to know is about searching in Canada, which you didn't do or the legalities of if they want to search in the States but, but are currently in Canada. And your answer to them was in your case, you just had kind of this visa path ahead of you because you were already in school and then you could do it, the extension visa. So if they're not plugged into an MBA program or business school students right now, they don't. I mean, your experience isn't going to apply.

[1:33:22] Guest 2: I would mention. Yeah. I would add the advice, like, look, the US Immigration system is extremely complex. Like, it's a very hard thing to read about online. Like, I would recommend if you're, like, look at deals in the United States, add to your diligence item list like the, the immigration pathway, and hire an advisor the same way you would, you know, a Q of E provider to, to give you a kind of a quick look, a quick take of develop a visa path. Because certainly there are Canadians that have searched out of Canada and acquired a US Business, and there are certain visa pathways available to you based on your own, you know, situation. And then, you know, conversely, I think there's also a ton of opportunity in Canada. I think Canada is undersearched. I hate to say this to an American audience, but I think there's a lot of Canadians that don't want to sell to Americans and they kind of want to keep that homegrown feel. So I think there's an advantage for Canadians searching in Canada that maybe doesn't reverse the same way, you know, cross border.

Host: Yeah. Fascinating. Great. Anything that we didn't touch on, guys, that, that you wanted to make sure we talked about.

Guest 2: Every guest says this. I would thank you as well for kind of building the community of search. And I think it's something Bob and I, it's a career path we're committed to for the long term because we really believe in the space. Like, I, you know, this is, this is what capitalism's good at, you know, is like, how do you take something valuable and you preserve that value over. Over generations? And I think I encourage everybody that's, you know, kind of fearful looking over the edge of the cliff going, hey, is this right for me? Like, I think get into it and you'll figure it out, you know, and you'll have some maybe fetal position moments, but certainly consider partnership and certainly, like, diligence your partner a little bit. It's. It's worth it. And I wouldn't be here if it wasn't for Bob, and I hope you would say the same. I would.

Guest 3: Yeah. Yeah. No, I think, I think the people that are, that are listening to this show, obviously they're already drinking a little bit of the Kool Aid, but. But I think, you know, it really is, it is worth the, you know, the grind to find a great business. It's worth the effort to find a great partner and then the effort that you put into the business all these things that you think can be true. You know, if. If you just kind of push on that. That door and, and, and through that uncertainty, you know, you. You can. It's worth it.

Host: Good. Great, guys. Well, I love your business. If it. If it weren't already clear. Tyrell, can people reach out to you for your spreadsheet?

Guest 2: Yeah, absolutely. Hit me up on. On LinkedIn as well. That's probably easiest way to find me. Happy to share that. I'll. I'll probably redact some stuff about my personal life, but yeah, certainly give you the tip.

Host: I want to see all the scores you gave Bob.

Guest 2: Yeah.

Host: And Bob is LinkedIn. How do you prefer people get in touch with you if they have a question?

Guest 3: Yeah, LinkedIn is best. Yeah, it's B, O, N, I, F, A, C, E. Boniface. Boniface.

[1:36:02] Host: Boniface. Great.

Guest 2: And if there's any searchers will that. That it doesn't work out, come get your CDL with TransTech as well. That's always an option for you. So trans-tech does.net is a. Is a great place to come to.

Host: Always selling, man, you know, the American. You've become Americanized, Tyrell. Always be selling.

Guest 3: There you go.

Host: Always be closing. Sorry. All right, guys. Tyrell, Bob, thank you for the time. What a great interview.

Guest 2: Awesome.

Guest 3: Thanks, Will.

Guest 2: Thanks, Will.

Guest 3: Sat.