$100 Million Market Cap Holding Co. E:64 Michael Girdley Top M&A Entrepreneurs

Right. Welcome to the top M&A entrepreneurs today. My guest is Michael Gurley. Michael is quite accomplished there. Uh, he's chairman of Jungle, uh, Disc, uh, chairman of Dura Software, uh, partner co-founder Jaline Partners, partner co-founder Kekam Fun, chair and co-founder of Factional Ventures, and Rud Runner, Red Runner Coffee. Yep, co-founder higher with near. Uh, chair and co-founder of Coop and chair of the board of Alamo Fireworks. Yep, that covers most of it. Is there more? Uh, somewhere in there, there is, yeah. So I got, let me just start this. So you did the Silicon Valley thing working for other companies for a long time, business development, product development, and what was the impetus to just say I'm gonna do this on my own? Is that because of the, and I know a little bit about the story. I know that Alamo Fireworks was Uh, family operations, right? Yeah. Yeah. Yeah, that was the real gateway drug to get me out of Silicon Valley. I think my wife and I, who had met in San Francisco back around the, you know, the turn of the millennium 99, 2000, we'd also just gotten kind of tired of the Bay Area stuff, neither one of us had family there, uh and it was also, you know, all of our friends were people that had moved there in their early 20s and now they were in their late twenties and they were moving out and um we joined the, we joined the flood. Yeah, I, I did that Silicon Valley thing too, and I just remember being, I don't know, 27, 28, and someone said like, should I buy a house? Well, there was 8 offers on this 3 bedroom house in San Jose, cash offers in a short period of time, and I said, well, I guess that's not gonna happen. Well, the short answer is yes, you should have bought whatever it was, uh, cause it probably would have turned out really well, but, um, but yeah, I remember being in a, we were in a a loft down in SoMa by the mereon. I remember in 1999, it sold for $650,000 for a 2000 square foot loft. And me just thinking that was the dumbest money. So who could, who could possibly pay something for something that small and uh boy was I stupid. It's probably a 4 million dollars a loft right by the new uh giant stadium and like. Oh man, that's, you overpaid for that. No, he didn't. No, no, it's all relative. It's all relative. So while at fireworks, you took over that for your family. What it looks like your first acquisition was code up. Uh, we incubated that. I started that from scratch. um, yeah, so. You know, I've done a handful of acquisitions, both directly and indirectly, but, you know, I, I tend to do also, uh, incubating businesses, um, especially when assets are really expensive, incubating turns out to be much more interesting from a return standpoint. And because you see this big need and let's put this together and It's a lot cheaper than to to start off than it is. Yeah, yeah, I think, I think that's definitely there, um, you know, there's a trade-off around that, but, uh, you know, one of my, one of my buddies kind of talks about when assets are expensive, make assets. It's like, oh, OK, pretty good. So, yeah, I've kind of learned to adopt that that methodology a lot, and that doesn't mean, you know, acquisition isn't part of the, you know, kind of the the tools in the toolbox, but Um, it's also not the only tool that that I used to kind of create ventures. You've created optionality there. So you've got this uh Dura software. I like this. Dura is a hyper niche software company. Uh, we specialize in hyper niche. You've got all kinds of event software. Uh, I was just looking at that. You have event software, maritime software, all kinds of stuff. Totally. Well, how do you find these things? Um, you know, we do, well, that's a, that's a corporation that I helped co-found, um, and we've, we did the first deal on our own, um, so my business partner and I, who, um, got it started, um, he's the CEO now, um, and I'm chairman of the board, and, you know, we went and basically did the first search ourselves to go find the first acquisition, used our own money to buy the first company. And then, um, since then they've gone on to buy 9 more companies, so they're at 10 total, you know, business units that they've acquired of software companies, usually in the single digit millions in revenue, um, and you know, we're just like any other kind of um serial acquirer of stuff. We have a staff whose whole job is to, you know, run a process against people who potentially would be the right right folks for us, so. Um, happy to dig into how all that works, but it's just, uh, it's pretty standard stuff. Things every PE firm is doing, every kind of acquirer is doing, running kind of the same playbook. When did you, when you said you bought the first company, what was the revenue on that first acquisition? They were a little, little into, I mean, it was relatively small, they were about 11.5, 2 million in revenue, which for software is, is not terrible, right? That stuff runs at 70 to 80. Yeah. Um, the software runs it, you know, um, oh, what was the bit of that business, or, uh, I think they were still losing money when we bought them, so we, we went and made them make money. Yeah, how did you, how did you pay for them? Are you, that was money you raised or had or or. Yeah. Yeah. Yeah, so when we started the company, we did the first deal with our own capital, um, we got a bank loan as well, personally guaranteed that to go by the first company, and then, uh, Paul went, and he was the CEO of the, the first business, um, and then after that, um, we ran out of our own capital, so we raised some money from friends, friends and family, um, and that enables to do deal two and three, and then, uh, go on and on about a year later, um, we raised a Series A. Um, of about $10 million and so that's propelled the company to um be able to buy the remainder of the businesses since then. So that start, you bought an unprofitable business. How did you value that? And it was losing money on that. Yeah, so, you know, when you're buying a business that's a turnaround, um, or underperforming, you build a perform a model of what you think the business will be doing after you're done with it and hope you're right. And uh so it's just like any other investment, you know, you go through and for us we're software people, so we just knew how to build a bottom up model of saying, OK, well, here's what's, here's what we're doing in this, and here's how much cogs is costing us, and here's how much admins costing us and finance and all that kind of stuff, and here's how we can fix those things and make them really where they should be um for a healthy profitable software company, maybe not the where, maybe not where we find it. Yeah. And did they take that first offer? Um, I think we ended up talking to him for like 3 or 4 months. Um, so there was some back and forth, you know, this, it had been a VC, uh, invested business, um, they had raised $14 or $15 million to generate, you know, a business their size, um, with 10 employees and, you know, everybody was just kind of tired at that point. They had done the whole thing where you go do the VC like, um, you know, hire a bunch of people. They had 80 people at one point and burned through a bunch of money, and then the VC's got tired when it was clear it wasn't gonna be a huge win. And uh left the staff kind of orphaned, so it took some time for everybody to come around to the fact that the the music was ending, um, sorry, go ahead, yeah. No. Oh, I've encountered that twice the first time and made an offer on the business, but they had to uh pay the VC off. One case was, and they took out debt to do that, and the other one just wrote it off. Yeah, VCs do here. Uh, they ended up writing it off, I think, yeah, yeah, there's not, you know, the, I think the VCs had by then been already kind of moved on to their next things and if I mean if you do the math for VCs, that's what they're supposed to do. They shouldn't be fighting over, you know, if their options are to spend their time, which is limited on how do I take my 110X performer and try to make it a 15X performer, that is much better odds for them to invest. They should be putting the time there, rather than how do I recoup another 10% on my original investment, um, for something that didn't turn into a home run. So, I can't really blame them for doing it from a math perspective. From a people perspective, it's a little harder to Little harder to admire. Yeah, I, the guy that had to take out a loan to pay off, I just, I was like, how long did that take? Because it seems like a waste of time for a VC. Focus on that. Yeah. Yeah, some of it, I mean, it's I think you'll see it differ between the Bay Area guys, um, and the less sophisticated VCs elsewhere. Um, Bay Area folks are much more accustomed to the power law stuff than flyover VCs are a lot of times. Yeah. So what was the next acquisition that you did in that group? The Um, we did the, uh, maritime email, Nordic, so that was our first overseas acquisition, so that was a great learning experience of buying something out of, uh, Copenhagen. Yeah, how'd that go working with the EU? Uh, really good, you know, we've gotten good at it now. The EU, once you start to learn how it all works, you know, each little country has their own like foibles. Um, I think it's the Netherlands, for example, when you buy a company there, um, they have like the equivalent of like a chop, you know, like the, uh, the Asian chop where like the corporation, you the only way you can really sign for the corporation is with the chop. They have like some version of that that there's like one guy that you gotta go to on a certain day who's there to make sure the corporation could be sold, you know, it's not like America, so they do have some foibles like that, but, you know, you learn how to make sure you have the right representation over there, somebody to translate. You know, the financial statements if necessary, the filings, and then the the lawyers who, you know, by and large are getting really accustomed in the EU to dealing with American buyers acquiring stuff there, um, but you start to get that routine down and it's all pretty, pretty standard. We've done, I think, more than half of our deals in the EU at this point. Yeah, and did you, so the IP and the code comes over here, or does it stay over there with them? Uh, it totally depends on the situation, you know, sometimes you want to bring it to the US, sometimes you wanna domicile it over there, sometimes you wanna put it in Ireland, um, all kind of depends upon, you know, how you're working around structuring it for the seller. Um, I think by and large we mostly leave it, we leave it in overseas wholly owned entities, um, whether that's in the UK or other places like that. How did you source that deal? I mean, Uh, finding a small deal like that in the Netherlands versus, you know, thousands of companies here in the US. Yeah, well, I mean, the fact that there's thousands of companies in the US doesn't impact does is impacted by the fact there's thousands of buyers in the US, um, so, so the, the further you go afield it's sometimes it's easier to find stuff that will underwrite for you. Um, you know, we ran basically the same process, um, you know, by then, once we got to be a little bit bigger. Um, and it's one of the moats around the Dura business now. You start to get known for the type of buyer that you are amongst the brokerage community. Um, so now, by and large, more than half the stuff that we're looking at is coming in as inbound from brokerages. Um, in the case of that one, I think it was direct outreach, pretty standard, you know, you, you build a list of companies that you want to go after and then you, um, run a campaign against them, same with any other kind of acquisition process. Yeah, and I do have a valuation uh tool on your website. Is that pretty accurate to what happens when you send an LOI out? Yeah, I'd say that's pretty pretty right on. I mean, we're, we're not, you know, we're not growth buyers by large, by and large, and the VCs will uh steeringly refer to us as value buyers. Um, PE will also call us that too, so, well that means they're cheap or not, I don't know, but. You know, we're typically buying more mature B2B software and uh it, you know, it kind of fits with our parameters and what we're good at and also the capital structure that we have. Yeah. When you first started this and say, hey, look, this was a uh did it work out that first acquisition and said, I, OK, it was a money losing operation, we turned it around, uh, let's start acquiring more businesses to be a small. Uh, you know, Andrew Wilkinson kind of guy, or the, the, the Canadian. With 500 acquisitions. Yeah, yeah, um, I mean, what, what is, have we been consistent with what our broader vision is that it's like, well, let's not stop, let's just keep going, how big can we grow this? What was the? Oh yeah, yeah. Yeah, I mean if you look at the the distribution of like small software companies that are out there, um, people are shocked when you learn that the long tail of kind of tiny software businesses is enormous. There's like over 100,000 of them globally. Um, so we saw that that really creates an opportunity much like Constellation software does, who you may or may not have heard of, um, really that, uh, doesn't do interviews or podcasts or anything. Oh yeah, Mark Leonard, that dude's my, that dude's my spirit animal. Um, but like we, we, we have similar kind of broad aspirations to what he is, you know, and I think there's a lot of people doing small software acquisitions in M&A who are kind of seeing it as a get rich quickly scheme. Um, you know, my co-founders and I were all kind of of the same age, you know, when I started the company, I was 43, my co-founder was 47, you know, like at this age where we want to compound and build something really um of significant meaning over time, and um so we've acted really consistent with that, like the compounding and Snowball is exactly what we want to keep doing. Do they intersect at all? They, they work together. I saw you have two kind of virtual events and an event management. Do they work together or do you just cross pollinate ideas and processes? Yeah, so we run um what we call, if you, if you think about the kind of um serial acquire models, the whole co models, um, I tweeted about this a few weeks ago. There's really 4 different categories, and they all basically are the spectrum of how much do you centralize things when you're acquiring things. So at one end of the spectrum you have like a pure roll up, let's say you're gonna roll up doggy daycares, right? Um, that can have massive centralization and standardization across everything because you're basically doing the same thing just geographically different. At the other end of the spectrum for hold codes, you have something akin to more like Berkshire Hathaway, right, where everything is just a P&L statement and they're totally independent and they run their own business, right? to uh trains. Right. Everything, yeah, very scale very scalable model, but not as efficient as obviously the roll up. And then there's some kind of steps in between where you can be in the same industry, um, or you could potentially be in the same business, or you can be in the same, you know, and so, so we're one of those types where there is some level of centralization that you want to have, um, and that allows us to be very good at buying smaller stuff. Um, whereas it's pretty hard to make a $2 million software company be a good standalone business because, like, it's hard to do a lot of stuff when you're that small, um, but when you get aggregated into a bigger portfolio or a bigger operating company, that type of business can live pretty well because you can centralize things like You know, some legion if you want to, or admin or or finance or HR like it's pretty easy to centralize all that kind of stuff um and have that be in one place. So we centralize those things, but by and large, the operation of the businesses stays very entrepreneurial. The CEOs for those businesses run product de, sales, marketing, go to market, and all that kind of stuff. Yeah. How have you changed going from being, you know, product manager of Silicon Valley to now hiring? And firing CEOs. I'm, I don't know if you've fired anybody yet, but, uh, hiring them, yeah. Yes, it's not that much fun. Yeah, yeah, uh, well, I mean, like, I think, uh. Firing people is and separating from them is always so painful that it, you know, 67 years ago really motivated me to go do a study of, you know, what is the state of the art in terms of hiring and recruiting people and then secondarily leading them. So I've gone on a real journey over that period of time to try to get better as a leader, um, because I think, you know, some people that in my career have washed out. It's not been their fault, it's been my fault from being bad leader or bad bad hirer. So, you know, I think um You know, the, the thing I would say is that when you're making that transition from industry, you know, it's very easy to get very narrowly defined and understand the world through a specific, you know, lens, you know, whether it's a big company lens or it's that skill set lens, you know, going out and being on my own has required me to be an autodidact and like teach myself all these different things, um, often through mistakes, but often through reading books or talking to really smart people. Um, and so I've had to make really a transition to kind of recreate an MBA for myself where I didn't have one, you know, getting a computer science undergrad. Yeah. Do you have any, are you in any masterminds, people that run, you know, 500 $million billion businesses that can just go, well, do this, this and this, and here's how, yeah. Yeah, I, um, I joined like 10 years ago. I joined a CEO peer group, um, it's been transformative for me. So I do one through um the Visage Global network, um, and there's a bunch of other ones. Um, I chose Visage in San Antonio for a number of different reasons that I'm happy to dig into, but um yeah, I do that, that's, you know, it besides being an amazing like learning opportunity and opening your eyes to different things, um, it's also like a huge social outlet and emotional outlet for people that are CEOs cause Before that, when I was a CEO I was like the most loneliest creature. I didn't really have that peer group who was going through kind of the same journey and my friends working at big corporations or whatever, like, they just couldn't relate. And when you're in there with other CEOs, um, you know, changes your perspective. Did you recognize that yourself that you were lonely, you're not getting that peer, or your wife say, hey, you need some friends in your peer level. Yeah, I think um I think there was a period where I kind of backed into this, um, you know, I, I started to see that things weren't moving as quickly as I wanted to move in my career, and I tried to diagnose what was going wrong, right? And I started to spend a lot of time working on myself, um, and then backed into joining a peer group because I pitched, I pitched the head of the guy that's that, you know, my business coach now. I pitched him to invest in one of my deals. And, uh, he's like, well, I don't think I could do that. But do you want to join my peer group? And I joined the peer group. And, um, and then I kind of backed into the whole experience there. So I wish I could tell you I had some kind of premeditated thing, but I was like, well, I have this mindset that I want to start to have more of a growth mindset and work on myself cause I'm not going as fast as I want to. And, um, then I just kind of stumbled into this thing and it's proven to be kind of transformative. Are you still in this? Yeah, yeah, I'm like one of the oldest, 2nd oldest member for the group that I'm in. Yeah, is that something you migrate to something bigger? You know, there's that big one out of what is California, I can't remember the name of it, but uh, YPO or YPO, but it's a bigger one where you can the average wealth is right around 100 million. Yeah. Oh, Tiger 21, 21, yeah, yeah, I think part, you know, Tiger 21 looks cool. The problem is, is they're investable as it's Well, number one, it seems like it's optimized for people who aren't really building anymore, they're just allocating, which that's, I don't know that I'll ever do that. It just seems totally boring to me. Yeah, it's like it's, and so, and they don't have a group for that in San Antonio. I just, there's not enough money here yet to support it, but um, but yeah, so and then, uh, you know, investable assets like I'm still pretty liquid, you know, like that's that's the way I'm just, I'm, I'm totally all in on growing and compounding the stuff I do have, so. The whole like let's together and look together and look at your portfolio stuff that they do probably doesn't really work for me cause I'm just not at that stage of life yet. Yeah. When you go back to this, the fire, the works business, and this is your family business. Mhm. Yeah. Was it at your family dinners? Was it just business talk? Uh, there's a lot of business talk, yeah. Yeah, I remember, uh, this is a long time ago, I spent a night with some friends, and his parents were doctors, and it was just talking about surgeries and everything. Yeah. Well, and behold, the kids became doctors, yeah. Um, you know, I think as we got older, um, I really wanted to push the family to have more separation of being a family time and then business time. So we started to put in more things that I think were good habits around that, so we would have You know, annual meetings around, you know, family business and stuff like that. And I feel like that stuff has really helped us all kind of be family first a lot more than family business partners a lot more, which, you know, can be very tough, right, when somebody is unhappy with somebody else and you both got to sit there and it's an unpleasant, like, you know, trip to trip to wherever or Thanksgiving dinner where somebody's angry at somebody, like, you know, if you start to build the habit where everybody is at first a family member during those times and we put business aside. And then, then when it's business, we're business. I, I found that to be healthier, and we started to do that probably 1012 years ago, and I think it, I think it does well. And you, do you have kids and interest in business? Uh, they seem like they're interested in business. They're 13 and 16, so their brains are still rebooting on a daily basis, so we'll see. Minecraft a ton of Minecraft, both of them. Um, my eldest son is gonna do an entrepreneurship program next year at school, so I'm pretty excited about that for him. They had to have a good mentor doing what he's doing, yeah, there you go, yeah, yeah, yeah. So, uh, Jungle Disk, um, let me ask you about the chairman. You know, if you get into a restaurant business, there's two ways you can eat. You either charge a lot for the dinner, or you can get more people to turn over the tables, or if you're an auto works, it's like how, how the how bases, you know, what's the revenue per bay? What is like the, the, the metrics, key metrics for a chairman of a holding company? Yeah, well, so, you know, I think it's important that every board member role is actually very different depending upon what the company needs. So there are times, for example, where like at Dura, the board is to a size and a maturity level enough now that I'm spending a lot of time worried about the culture of the board and the tone of the board, uh, and then spending that coaching, you know, the CEO and being a partner to him as best I can. And so that's a very different role than say being the chairman of a brand new business that's, you know, just getting off the ground with less than a million in revenue. Um, there you're often doing more direct problem solving and getting involved in the day to day versus a coaching kind of role. Um, so it really, it really totally totally varies, you know, unfortunately, by and large boards, nobody's really come up with good KPIs for boards. We've talked about this on one of the boards that I'm on about. Do you do like, do the CEO and COO should they review the board, um, and so we tried that and it was like, well, what do we do now, you know, it's a very con about it with the information, what do we do? Yeah, so it's it's still kind of, it's still kind of a work in progress. You know, I'm, I'm a fan of boards, you know, they, they theoretically should do 3 things, you know, they, um, they approve strategic plans and, and very big decisions, um, they, you know, they hire and fire the CEO, um, and then they operate as a consultative, you know, skin in the game kind of group that helps with the CEO and, and big decisions on things and and those are really the three things. That I try to limit boards to do, um, and that way you don't become that dysfunctional board where you're in there like doing operating roles or swooping in and making decisions or or whatever. So, um, now when you look at those things, do you really have KPIs? Not so much. Um, hopefully you have CEOs that think you're doing a great job and feel like you're making their day better, um, and making them more successful, and I think in the end if you can do that, you're gonna, you're gonna win the long term. Well, tell, tell me how that works. You're, you talked to one of your presidents, the CEOs of one of your companies. I, what do you do? Like just asking, hey, what can I do for you? What do you need? What resources? Yeah, yeah, there's a balance there. I mean, obviously I, I need to be up to speed on things so I can be helpful. Um, but yeah, you know, the, the typical kind of interaction cadence I'll have with the CEO, um, is a standing one on one, so we'll just catch up once or once or between 1 and 4 times a month. Um, we'll have a call and a lot of times, you know, I'm, I'm interested in what's top of mind for them. What, what's, what are they thinking about now? What is the biggest thing on their mind, we'll spend time in those calls around that, um, and it's an opportunity also for them to coach me on things or vice versa that it feels like could be, could be going differently. And then they're, how do they coach you? Um, you know, we, we hopefully develop a level of trust, um, to where they know that I'm, I'm trying to have myself be in a growth mindset, and I'm open to feedback and wanna try to do things differently. Um, and by differently, I mean, I want to do them as best I possibly can, um, cause I know I'm not gonna be perfect. So, you know, if you can build that level of trust to where they understand that, hopefully they feel comfortable sharing those things with me that can be feedback um that I can act upon. The second thing I'll do. With them is sometimes there's, you know, I think there are things that you're doing wrong as a human that you understand, and you can, when somebody says it to you, you understand what what the mistake is that you're making. Then there are times when somebody says something to you, and you're like, I have no clue what you're talking about. Like, you just don't have the right lens on humanity or your own self to understand what they're saying. And so one of the things I actually do is annually I ask my business coach to go confidentially sit down with each one of the CEOs. Uh, and then prepare a report for me and say, here are the things you're doing well, here are the things you could be doing better, here are the things I heard from people and take them anonymize that for me, and then distill it for me into a way that I can actually understand it and act upon. Um, so sometimes there there's an intermediary in that coaching process as well. Yeah. Do these, your CEOs, the people you bring on to run these companies, do they get a slice of equity of the business? Uh, it could be anywhere from 0 to 50%, totally depends upon the situation. Yeah, if they came from an industry that, you know, they grew a business from 1 to 50 million, did it a couple times, they'd be in high demand. For sure, for sure, you know, and there's, there are people who also, um, a lot of times sort of incubating stuff or putting it together, they're coming in at a very nascent stage for the business. So a lot of times, you know, there are people that that's not right for them. They wanna go run an established ship. Um, so, you know, also the, the earlier the venture gets and the more risk they're taking, like I'm taking, um, you know, oftentimes the more equity they need to make that kind of trade-off makes sense for them. Yeah. Where do you want to go with this? I, are you thinking about taking it public, or? Keep it private? Yeah, so, no, uh, you know, for the stuff I'm involved in, there's no exit plan at this point, you know, when I die, you know, my wife or somebody should be able to have somebody run it for her. Hopefully it could be as easy as a ham sandwich, like um like Warren Buffett says, um. You know, my, my decade-long goal, I kind of put that out. I, I put it on Twitter and talk through kind of what my, my goal framework is. Um, but basically I'm measuring success around kind of growth and net worth. So a number of those things are compounding, and I'm 47 right now, so I still feel like I'm not gonna die, at least what the actuarial table say anytime soon. Um, so I've got time to keep compounding on all that. Um, you know, in the near term, I'm gonna keep incubating and doing more deals and acquiring more businesses and Setting them up to be successful. Yeah, that sounds awesome. How did you get into the Red Runner coffee that was just completely, you know, something different than tech. Yeah. Yeah, we started that in 2020. Up until then, I had always taken an active role in incubating companies like I was always doing the CEO job at the beginning or something, and I wanted to start one as an experiment to be like, OK, let me incubate and craft a company. Um, from scratch without ever taking an operational role in it. So basically the only operational thing I ever really did in the company um was hire the first general manager, um, just an exercise for you to see if you can do it. Oh, I mean, I wanna make money, we're making money. Yeah, I wanna, yeah. Yeah. But in terms of like, what what was the transitional period for me and what did I want to learn out of it, that was kind of the meta about it. But no, we've we started that in 2020. We just opened up the third location, um, their drive through coffee shops, ala Dutch brothers, um, here in San Antonio, we're doing very well. Um, we brought on a third partner, uh, who is a former Circle K executive and he's running the business and doing a great job. Yeah, and I was gonna jump back to this, uh, the fireworks business. This is like, there was a reality show, uh, about that guy that ran a bar in Sturgis, where he made all his money in 7 days. Oh, nice. But he, uh, had to, you know, work 24 hours a day, because the bars go just around the clock, is that Do you like that business or do you? Because you gotta, you gotta make your money just in a very short period of time. Yeah, I mean, when it's doing well, it's easy to like a business, so we've been doing really well lately. So, um, yeah, I mean, it's, it's a hard business, right? Like the feedback cycles are enormous, you know, normal business you have week to week, month to month to understand how you're doing, you can tweak, but in that business, it's 6 months or 12 months to get a feedback from the market and you see people run into brick walls and go out of business pretty quickly. Um, if they don't have a good enough cushion or expertise in the business to make some good decisions. So, you know, I think, um, it's great to see what the business does for me and my family, great people involved, um, on the employee and team member side. There's some people really living their dreams, um, working in that business, but it's definitely of all the stuff I'm involved in, it's the hardest, highest level of difficulty. Yeah, and you, as, as far as you're running, you don't really, you can't sell it, right? It's your family. Um, you know, we could if we want to. So, yeah. Um, there's 2 of us that are shareholders, my brother and I own it together. Yeah. Let me ask you about this advice you give your son or daughter mean entering the entrepreneur world. What would that be? Um, you know, I think, I think keeping it super simple is the most important thing. Um, you know, the type of entrepreneurship that I practice is called, um, effectuation. Have you heard of this? Uh, I've heard of it, but I haven't looked into it. So I, I wrote a Twitter thread about it. I highly recommend it, mostly because I Wrote it, um, that means it means I think it's good. It's gonna be good because I wrote it. Um, but basically effectuation is this, um, brand of entrepreneurship that's like lean startup or it's like, um, the waterfall model. So waterfall model is like we have this big vision and we're gonna iterate to it and we're gonna get there, right? So, um, that's, that's one way of doing stuff. VCs love to do stuff that way. Then there is kind of the lean startup way, which is develop some hypotheses about customer needs, and then you go out and you interview them, and then you maybe come back with some more interview questions and you interview some more people, and so you start with the customer problem there. Um, effectuation is kind of the third thing, which is instead of vision, or you say, um, what's your problem, you say, here's here's an opportunity that I kind of hypothesize exists. And I think I can execute on it. And what you do then is you go sprint straight towards learning as much as quickly as possible about it and the way you do that is by shipping stuff uh as quickly as possible to do it. So let's say you want to start a software roll up vehicle that's gonna go by software. The first thing you do is don't worry about what your big vision is, or you're gonna be Mark Leonard or something else. You just go by one company and you just go from there. So it becomes kind of, it becomes kind of beautiful. And then once you, once you have something that works, then you double down on it, then you triple down on it, then you quadruple down on it, and you keep pushing it as long as it keeps working. So, you know, I think that comes back to the advice I would give my kids. Like, I love that formula because it de-risks what is a pretty risky thing, which is like, just get some stuff out there, make sure it's a recoverable loss for you, go see what people think and go prove your point or not, and if it doesn't work, move on to the next thing, and if it does, you know, great. Uh, I like that. It's pretty simple. Uh, my son asked me, you know, how do I get better at basketball? Well, you go outside and start shooting basketballs. Uh, yes, you miss a lot of shots or go find some kids that are better than you and let, let them kick your ass. That's that's kind of that's the alpreneurial equivalent. Over over and over years, yeah. Some, some of the best advice you received was it would be for books or people at a distance or uh somebody close to you, you could just go, hey, you know, dad or grandfather or something. Yeah, I mean, so many things, you know, I had a lot of wise ancestors, um, you know, one thing, one story I do like to tell people about is, you know, I have a computer science degree from kind of a a minor small liberal arts college up in up in Pennsylvania, and uh we had our our professor who's um now tenured, but at the time was trying to become tenured, uh, and he was teaching us computer science and we go to these labs. And the professor would, um, would refuse to answer any questions in the labs, right? So these are supposed to be practical situations or demonstrating what you know for the real world, and, uh, he would refuse to answer these things in the labs, and it would be very frustrating for most of the kids cause they're just accustomed to their parents or the other professors spoon feeding them answers. But this professor, we'd ask him a question and he'd say, I don't know, have you read the manual? And uh after the 4th or 5th time you do that, you start to realize that what he's trying to train you to do is become Self-reliant, right, and able to be somebody that can operate independently and push the ball forward and start to achieve things on your own. And you know, as I think about the advice that he gave us, which was not really like, hey, like do this, Sonny, it was more like, here's how the world's gonna treat you, and this is the way to get ahead, is not by asking me questions and becoming dependent on me, but really I'm gonna train you and teach you how to be independent and therefore successful in your own right. Hence your effectualization. Yeah, I guess uh Professor Liu would do effectuation. I think so. So what do you do when you feel overwhelmed with all these people coming to you needing stuff? Well, you said yourself and how do you do that? Yeah, um, well, first of all, I don't, that rarely happens, um, you know, I've got, I've got great people that I get to partner with on everything, and by and large, um, I feel like, uh, they know they can call me whenever they really need to, but by and large they don't cause they're really great people. So, um I think it's pretty great, um, you know, to relax and stuff like that, like I, I love, I love reading, I love writing. Um, I mountain bike, I road bike, I go to CrossFit, I love skiing. My wife and I love to travel, so yeah, people are like, do you have hobbies? I'm like, yeah, too many. I got a lot. What, what kind of books do you like to read? Um, a lot of, uh, personal self-improvement and, and business kind of theoretical stuff though in the past couple of years I've really slowed down on, on reading those things. I've probably gone through. 100 and I had a library of over a couple 1000 here at one point, um, I donate a lot. Yeah, I, I, I think I order like 2 to 3 books from Amazon and business books. It's a never ending supply, a never ending such yeah. Um, you know, for me, for me, reading books is really slow just because I started to Just see the same kind of few 100 ideas repackaged over and over again. Um, and the ideas that I was interested in at that point were ones that are not necessarily showing up in books, because you can't sell enough books to justify writing a book around those ideas. Um, and there's a, a few of those, you know, start to show up around the edges, like if you wanna learn how private equity works, there are books around that kind of stuff, you can go read them and, and that's great, but some of the more nuanced stuff like how do you build a sales engine and stuff like that, like. You gotta go other places to find that stuff, whether it's Twitter or YouTube videos or that sort of thing. Yeah. Michael, I look, I appreciate the time you spent with me. It's been great. I mean, my audience are acquisition entrepreneurs. Some of them haven't made their first acquisition. Some of them made their 10th and uh I think this would be very valuable. I really appreciate this. Yeah, super love it, um. Love to plug our our podcast that's in the acquisition space. I don't know if you've heard of an acquisition entrepreneur, right? Uh, no, we're Acquisitions Anonymous is the one we do. Yeah, yeah, so we just did our 104th episode, so the general concept is we get together every week, um, sometimes twice a week, and we just look at two small businesses for sale and we just totally Like, talk about all the things about business that don't show up in business school. Um so check it out, it's at um AQAon.com, A C Q U A N O N, so acquisitions anonymous.com, and uh we're, we're desperate for listeners. No, by the way, you're on there. There's a guy that I haven't met. He's running an e-commerce roll up, right, out of Florida? What's his name? Uh, Bill D'Allesandro, he's in North Carolina, but yeah, close enough. It's like the Florida, the East Coast. I, I'm the Southwest. Everything that way just looks like Florida. Yeah, you should. Bill is super smart, Mills is super smart. I met them all off off Twitter. Um, it's kind of magic of the platform and, you know, we had the idea for the podcast, and then we just went and recorded one and 104 episodes later, we're selling ads and got a general manager running the thing and, you know, doing great. How come you don't use the LinkedIn? Why is Twitter work better for what you what you want? I started to put stuff on LinkedIn, um, I think. I think uh for somebody in my position, Twitter always felt much more real with the Annons around. I like that, um, but now I'm taking my best stuff and I'm putting it on LinkedIn, so we'll see. All right, all right, well, uh, we'll connect. I think we're already connected, but I'll I'll like and comment on yours. Oh yeah, yeah, I'm desperate for attention. Yeah. All right, Michael, thank you so much for your time. I really greatly appreciate this. Right on, thanks, John. All right, cheers.