M&A Roll-Up Playbook: The IRR Framework That Replaced Budgets at Zayo | Dan Caruso (Part 2)

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I get that it's dealroom.net/dealmax. Hope to see you there. I'm Keith San Patel and you're listening to MNA Science where we talk with deal professionals and learn valuable lessons from their experience. This podcast focuses on stories, strategies and what actually happened during MNA deals. Welcome back to MNA Science. This is part two of our conversation with Dan Crusoe, founder and former CEO of ZEO. If you haven't listened to part one yet, start there. The link is in the show notes. We covered how ZEO built its thesis from scratch. How they found deals, nobody else was chasing and how they pulled off a hostile acquisition with a fully funded offer delivered in a sealed envelope. It's worth it. Today we pick up where things got complicated, post IPO talent drain, the equity value creation model Dan used instead of traditional budgets, activist investors and the full ZEO sale, including how Dan engineered a competing bid when the lead consortium tried to leave him with no other options. Let's get back into it. Did it change between doing deals at private company versus a public company? For us it did, but it did because of the dynamic I just shared. Right. Got more competitive, but then your structure approach changed at all. We didn't use equity. I don't think I ever made it a little bit. I can't remember one deal where we used our public equity as part of the deal because that would have been discounted by sellers. But what changed was just the competition for deals. Everywhere you'd go in the 2017 era, just where in public in 2014, so by 2016, everywhere you'd go in industry, every infrastructure fund, they would say, yeah, we want to do what ZEO is doing. Also, we had a dozen infrastructure funds. We had billions of dollars to put the work. And you'd say, well, what are you doing this space? We want to build a platform just like ZEO. You just had an over abundance of competitors chasing deals. And it was a good time to be sellers at that point. I think that happens to every good thing. People catch wind and boom, everybody else is going to follow it. But we had like six year window there. That's the thing. Yeah, that's like a good brand in the market. It's just, it's just, it's just, it's just, it kept going. And it's like the erratic behavior is part of the negotiation. You have the example of the silo, which I've known folks that do that. I could appreciate it. Was there any other examples of unique things you do to negotiate these deals? Oh, yeah, all the time. And sometimes we do just for fun too. But I didn't want to, the seller would not respond to nothing. And I remember sending a box of chocolate with an offer. And he finally answered the phone. He's like, thanks for your chocolate. It offers too low. I'm not funny. So I mean, there'll be times where like you're going back and forth in the negotiation. And we'd be at 70, whatever 70 is, maybe 70 million. And they wanted six million. So we go 71 and they go to 75. And then we go to 68. And I'll say, we can't do that. We can't go back with a lower number. Like, yeah, these guys aren't taking their number, go back with a lower number and let them like, stare at that for a week and see what they say. And then they definitely come back and be like, yeah, I'm not sure what happened there. We probably need to talk a little bit more. Make a spec on straight. We're not sure where that came from. What did you uncover in the diligence that made you lower your number? What did you hear to image lower? And you know what? Tell them just find to see how you're going to react because you were being like a little stubborn and we wanted that emotion to go like from the, your toenails to the top of your head. Oh my god, this deal might not happen. And if it doesn't, might be a lower price than they were offering before. We just wanted you to fill that emotion. And then it's like, I know your last offer was at 71. And our last counter was at 75. How about 71 in one quarter? That's what they'd come back with. Also, your number looked awful high. I like that. You got bare on them. Yep. What else? They silence. Coming back down on offers. Start telling them about this other deal you're doing. So fun one, too. Like when you're like getting ready to have your negotiation or dinner and be like, hey, I know this isn't really part of this discussion, but poor work on this other great deal. And we didn't think it was going to happen. And I was trying to pick up momentum and it's just perfect for us. We're struggling with the time to do this deal because we really want to move on to that deal. And they're like, what do you think they're talking about? And then they're trying to figure out what deal you're talking about. We might just made it out. That doesn't mean there was a real deal there. So yeah, these guys can move on from our deal and go work on this other deal. We don't forget this deal done like tomorrow morning meeting. That's my favorite only one of opportunity to get to finish line is what we want them to think like that. Create urgency. There's like a foam over your attention. They are creating where they want to get the deal to for certain. I've been doing the whole playbook out of this. By the way, like I said, I'm pretty cool. Makes stuff up. It's like kind of our. And some of it's pretty legit. It's kind of believable and it's kind of be stuff that very likely could be true because you can't be stuff that they know you're making up that will work either. People want to get deals done when they're ready. So yeah, this is like a control. I think there's sort of what you're positioning. There's back and forth and like that going on the offer thing. It's like, all right, let's go back down and reframe the control and this negotiation here to a fashion tell all my little bag of tricks. But another one is let's say you're working with the CEO. And then the CEO wants their investor wants to hear directly what's going on. Like the investors get frustrated. There's a not getting their price and the deals dragging out a little bit. And the CEO of course is briefing the investor. Here's exactly what's happening. And here's what they're saying. So now they want to bring the investor to the restaurants here itself. So you throw the investor curveball. You say something that the CEO never heard before. But you say in a way like it was just part of the conversation. So now the investor's got to go to the CEO and say, well, you never told me this. You didn't tell me that was what going on. You didn't tell me that this is part of what's holding up to deal. And now the CEO's pretend like they knew even though so they don't know if it's true or not true. And they don't want to say now they that was had nothing to do with that. They just made that up. That doesn't sound like the thing either. So now there's a little bit of distrust between the CEO and the investor because the investor thinks the CEO didn't tell them full story. And the CEO's like, I don't really know what happened there. And I don't want to sound like I didn't know what happened. So you just have to surprise the surprise be around. Like the terms of the deal or more of just some new ones. Just some silly you know you pick on something that's probably not too relevant to be long. We actually work on full with that price. You know probably would get there. But some of the diligence we did on the network. We found some stuff we weren't expecting. And the investor like does this and it's investor. What's those investors going to say? What'd you find? They don't want to say that. So they and then you say it like as if the CRE knew that. So the investor doesn't act like they don't want to know. And then they're gone. So it's not like the investor could call you up afterwards because the investor goes gets on a plane. And then he has to look what was he talking about? He was like, I'm not sure what they found in that. It sounds like they already shared it with the business stupid stuff like that. I love it. I got enough to put a framework. Dan's bags of surprises. I probably should already look on that probably saw more than bandwidth. He's here to write. If I did an afternoon 20 page manuscript you. Okay. So I want to talk about the execution of these deals. Because this one thing get the deal actionable get the structure get the L.O.I. signed. But then from there 45 deals and I published a book called by a lot of M.A. And it was myself going through about 300 of these podcasts and reflecting and saying here's a pattern here. When you look at the maturity of an M.A. function and a corporation. There's clearly a maturity that happens from the first deal. Tens of beef or an inbound auction process. They scramble to go do the deal. And then they make a bunch of mistakes. Then you look around the 10th deal very by led just like you describe were proactively looking for the right asset. Even if you look at that execution. They're really taking lead and making sure that they're going to fall through and how they're going to integrate the business. Move fast and so another way let's do integration after we close and figure it out. It's so different even for the first conversation and let the CEO know where they're going to fit in. I'd love to hear from you and how you see it evolve as a group. How your execution process matured over time of the deals you've done. Yes ours was almost like a curve like this. I want to draw it is like going up and then going down. So the first call it six, seven years as they were like magic. The team worked together really well. We brought in some new people, one part of our team before and they melded with us really well. And like our CFO and Zail joined us maybe a year into Zail. And none of us ever knew him. He was recommended by one of our investors and it turned out to be just a key part of our team. As if we worked together for years prior to that. The left hand knew what the right hand was doing and we could talk to short hand and we were forced to be reckoned with. We were really really good at what we were doing. But then the other thing that happened when we went public. is then the team started to get a lot of liquidity. And also, everyone was worth the share of the money. I was at already made a lot of money with a lot of the people on the team. The first time they really had liquid liquidity of significance. And it's not as much fun to work in a public company environment because you got to deal with a bunch of just public company kind of bullshit. We're bigger. It's becoming less fun. We've got poorly earnings calls. We got to deal with just a lot more noise in the system. And the people who are more untrue or like, I want to go take my money and take some time off and do some other stuff. I want to buy a car, I want to buy a house, I want to buy a second home. And I want to go into natural environment again. So in the window after IPO, we lost a lot of our court talent. And I still want to keep it going. It just became less fun and harder and more competition deals and more of a slug. So we kind of hit our A day. Both when we went public and a little bit thereafter, but then it became harder after that. Let's talk about the good times. What was like the maturity, how you saw it evolve from like the first deal going to that six, seven year period? There was a period time where it was just fun. It was fun doing deals. It was fun integrating. It was fun being the center of attention to industry. It was felt a lot of success. Was it just like natural maturity that happens from getting the reps in that, hey, we're building our playbooks. So we're getting better at this. And yeah, I think so that we knew we had good thing going. We won the big innovations that we had is in our industry at the time, the common approach was to have a bunch of different systems, each of which had its own version of the data and then integrate the systems together. And there'd be processes and workflows and a lot of other bureaucratic words that you'd use to describe all that. And I had this epiphany that if we could get all of our data into one system and define all of our processes around this system, we could just make things a lot more effective and efficient. We were already having success using Salesforce.com in the sales side of the equation. And we just started adding everything else we did into our Salesforce.com instance. So it became our full end-to-end system, life of the customer, billing and provisioning and everything. All in one system that was visible to all of us. So our ability to have command and control of our data in one instance, the only difference when you were done with the sale is it just transitioned into now as part of the service activation process. It was just a stage not transformed one system to another system. It was no service activation, transition and a billing. So it just gave us this platform that was a huge advantage, both in operating the business, but more so in synergizing and bringing together these disparate networks all into one instance. We felt confident about that and we were innovating around that and we were creating and we were operating. It was a period of time that was just shitload of fun and we all felt great about it. Did your execution approach evolve or change where you're doing more of this integration planning earlier in the process? Or is there anything of just even, when you think about getting the executive team, a lot of people are fixated on the price and how much money they're going to get versus how they're going to be evolved with the business, post-close. Was there any of that stuff that you started changing in the front of the deal to make it more successful afterwards? Nothing comes of mind really. During the heyday, everyone was motivated by the true value of the company. We developed early on this methodology. I developed and called equity value creation and it became almost like a religion within our company and one that the key people understood and bought into. So it was true metric of defining how much value are we really creating authentically and how does that translate into dollars per share and the value of management equity and people could see that direct equation and what it meant to them personally and what it meant to us as a group. And it got rid of a lot of politics and arguments over one person's opinion of what's valuable versus another. I don't really care about each other's opinions. What does the math say? And it became kind of unifying and organizing way of focusing everyone on what's my contribution toward this value creation equation? That created alignment with the people to really ultimately be on the same team and execute. We're going to dive deeper into that. I wanted to know as you scaled and started doing more deals, what's the first thing that broke? We're in terror of everything we had been going through started to take its toll. The former team moved on, the original team moved on and newer people came in, they didn't buy into what we're doing as much as the older teams. Some of them did, some of them didn't. But we're a company by that point and that was a tax competition for deals. Not so much the competition in a marketplace, but the competition. Well, that's not true. Even what we were doing organically, the kind of deals we were doing organically, we also had this, we were innovators there as well. We were doing these deals, particularly with big web scale companies, that's what we called them back then, as well as mobile carriers. We were doing these really unique big deals, helping them leverage fiber and others started to catch on in that. But when the infrastructure guys came in, then even bit up those commercial deals. All of a sudden, deals that we knew were really good deals for us and really good for the customer, but we could get them done. Now, some of the things they have cheap money or cost capital, they want those deals and they're willing to cut terms that are much more favorable to the customer. They were like, okay, I don't know if we want to win that deal or not win that deal because you win that deal, you might be losers at things. You don't want to do a bad deal. You can bit up where it's a good deal as a bad deal and some of them were clearly bad deals, but then that's not fun to lose deals either. So it was a toll of all those things. We were victims of what we created at that point. Now, we still did well. Don't get me wrong. We were used to creating value at a pace of literally 40% a year. Our equity IRR, which we would measure and would get validated based on future rounds. Every year, our equity was going up literally 40% in value a year. 40% a year over six, seven years. That's how you get from a billion dollars to eight and a half billion is you just start compounding at a high rate. And we would measure that, but also 40% went to 30% went 20% then it was like, man, we're having trouble increasing this by more than five, six, seven percent a year. We would never go backwards. That wasn't what I was playing for. I don't want 10% equity value creation. I was like, I don't know, I could go for my money in stock market and do nothing and get that. So when it was harder and harder to see the rewards of what you were doing in terms of creating value for your investors and for your team, that would take a toll as well. That's when you got shift to be a seller, which is what we did. Before we jump into that, were there any other integration mistakes that you made early on that you later fixed? Yeah, there were tactical mistakes. I could look backwards in time and wish I would have, and these are ones of what I could have done differently and I won't get in them, but there were like three or four deals where I'm like, you could have handled that well off that. I could have been better in terms of how I directed an integration tech place, being aggressive work for us and aggregate, but sometimes maybe being too aggressive is where I would have been a little more subtle at times. But it's not like things got figured out. You understand centralizing data. Was there anything else that you thought you did differently in terms of integration that protected value? Just said, we kept sticking to our strategic roots because a lot of the companies would require reason. We like them because of a certain part of what they're doing. They're assets and part of the business that resonate with us, but they would do other things that were different. And what we would do in those cases is sometimes we would just separate into two businesses, which was unnatural. We like, okay, this is a voice business. And no, we don't want to be in the voice business. That week, especially don't want to be, but there's value in that voice business. So we're going to set that up as its own business. And I look for like, I don't even know what you're talking about. This is just a product that's on top of all other products. Everyone thinks their product is really high margin because they don't pay attention to costs that take place below their layer. So we would separate into business and they're like, okay, now that's separated and you got to buy the services underneath you, just like your competitors would have to do. Now we would apply that value creation equation to that. And we find some really good entrepreneurs who would also, they would be empowered. Now I understand what I need to do to really create value in this part of the business. And then we would monetize those separately. We would sell those off, but we'd keep the pureness of what we had this bandwidth infrastructure. We wouldn't try to go up the stack, you know, I don't know how many times I would have to deal with we require a company and they'd have this great plan that they were going to bring all these new products in place. We don't want your new products. We want to be the best bandwidth infrastructure provider out there. That's what we do. But no, we don't want to lay around our layer. We don't want to go after small businesses. We're here to serve those who really need lots of bandwidth and where your network gives you a huge advantage. And we don't want to get distracted. So that played to our advantage as well. How do you think about culture? If you think about culture and there's a big thing that comes up, integration goes bad. You want to blame the culture. We're incompatible. Zio had a good reputation and a good, long time friend that actually worked for years ago and he'd always rave about the company culture. And I feel like there's like different schools of thoughts. There's, hey, I'm an acquired business. We're going to come together and make any culture. Old school, Corp. have thought, right? Then you have more of a progressive. We want to understand their culture and find a nice tailored way to get the best and integrate properly. There's some teams in EV separate. Sure. And then there's this more aggressive. Like they're going to come and fit our culture. That's what it is. We have it. They're going to come and conform and we're going to help them. We're just going to be upfront about that. What was your view on culture when it came to the deals that you did? Yeah, I was definitely the latter for us. It was, we have a culture. I'm going to say our culture is better in your culture. In fact, some of the companies acquired head great cultures. Like above net and great culture, it was just different than our culture. And if it's like debating systems or debating the name of the company, you allow people to start. We want to tell you about our culture and we'll tell you about ours. And you know, what are the mirrors that you owe? Let's come up with culture. That's the best of both. We don't have time for that. We have a culture. And we want to move on to the next deal because before too long, we're not going to have deals to do anymore. Other people are going to catch ads. So here's our culture. It might work for you. It might not. We're not seeing culture is better in your culture but it's the culture. Were you upfront enough that when you started? Yeah, maybe to fall to yeah, absolutely I'm fine about it. I don't know if I use the word culture, but I'm like we have a way of doing things For some people this is gonna feel really good and for some people We're gonna look like the devil and they're gonna like go and say this is the horrible thing ever because of their culture and like Yeah, we're not the right culture for everyone that we don't have a universal culture We're not like we're not trying to come with a culture that works for everyone come up with the culture people really want to roll up their sleeves and Do some really cool stuff and create the leaning company in the industry in a short period of time and that means you're gonna have to want to be part of that Ross pulled us open else You in the new in public. What's it like taking a company public? Why'd you do it? Who is it like going public is still the big achievement the career achievement for people It's like I took a company public still matters now. There's a lot of baggage that comes with being a public company So if I knew then but I knew now I was having a conversation with someone recently who is likely to take their company public and Learn a good situation so they're trying to think about the context which they take a public and one thing they're thinking about is whether to Create super majority shares voting shares of super voting shares that would be held by the Managing session ciders so most bankers and lawyers say no don't do that because there'll be problems But when the person was bringing up my advice was you know what you're gonna go public But you should do that if I had over again. That's what I would have done I would have ignored the bankers and ignored the lawyers because if Activist investors see that it's mostly held company. There's a majority shares They actually will move on to something else They're gonna find companies like a pick on not companies that they go to they get to say I'm sorry you feel that way We there's five of us who control the voting in the company and we're gonna do it We're gonna do anyways the actress just move on I go somewhere else. Yeah, it's great to sit up there and ring the bell In fact, I got to sort of enjoy that again just two weeks ago because one of the first investments I made After I left zeal and one that I served as in terms The CEO as a transition period was called cold-connage time is called in flexion now They just went public week and a half ago and I got to watch them They invited me to go out there with them, but I didn't make the trip But got to watch them go through that experience and it brought up great memories of how special that moment is When you're ringing the bell and you're celebrating afterwards. It's just a special life moment for everyone involved So think through control of power dynamics when you go public There's a more homework. It sounds like you do earning calls and are in the public face at that point in time You had to deal with the whole investor relations, but the fluctuations in the market. How do you view that market sentiment that is either on your side or again your counterparty? I'm curious. How do you think as a through that as an public company operator? The way I thought through it I don't know if this worked or didn't work at the end of the day is stuck to the principles of the value creation It's like for truly creating value like measurable value the stock price will find its way to your value At times I will think you're worth more than that times I'll think you're worth less than that don't get caught up in what the market thinks than again point in time but be transparent in how you're thinking about value creation and why and Over time you'll end up with investors who Want to invest because of how you're creating value and they understand it and those other investors you're gonna want to have for the long term That was at least my theory and practice it was more complicated than that and maybe I'm not the best public company CEO from that perspective because I was maybe a little bit naive just thinking I had kind of a war and profit type approach is just be plain and Tell people what it is don't tell them stories and don't fall into the traps and that's easier than done perhaps It wasn't like a PR game for you to keep a positive perception of the company No, I've stopped people getting that trap that they were always they were always of the frame mind How do you view your stock price the public markets don't fully appreciate our company? It says all the time and he's absolutely nothing for me It was like I'm not gonna go down the rods by jobs not to make the stock price as high as possible That's just not by job you do that. That means someone's gonna buy your stock at an over inflated price once they buy your stock to your partners You help sell them something for more than it was worth yeah, maybe the person sold feels good about that But they're not your partner anymore now your partners person bought it at too high a price Did you really do well for them? So for me it was like I don't know what the exact price that's right for the company But I don't want to be on the side of Hipping it to be higher than it should be I want to be Transparence possible so that Fires and sellers pretending to make a good decision The buyer is buying a fair value in the seller selling it fair value and then we increase the value or time not based on storytelling but based on kind of fundamentals What surprised you the most about Transitioning and being a CEO of a publicly traded company. I think I put up structured the management equity So the for those who there before the IPO I could have done some things so that there'd been a longer transition period before it would Been easy for people to leave and that it would be more staggered but I mistakenly set it up so that it would be optimal time for a lot of people to leave all happen one year after the IPO And that was gone forced here on my part because I could have done things differently to foresee that well if you do that What are people gonna do they're gonna leave so that they could be easier from the sell once they leave and then they got a lot of liquidity We're gonna take some time off while I'm still like slugging away and then they're gonna start doing stuff again Like we're applying to playbook that should have been very predictable to me. I need to be there for a period of time longer I should have made it harder for people to leave Well, I didn't have that option of leaving. There was harder to onboard new people and maintain the momentum So that one I should have seen another one I didn't see and I don't know how predictable it should have been But I revealing what we did so I thought we already revealed it for the IPO But by revealing the financial success that we had in a way that outsiders could really teams of people and say how did they do that? That our playbook would also be understood by others who then could grow a bunch more money at trying to do what we're doing and So we just jump into that sort of competition Were there any skills that you thought you developed as a CEO as a public company CEO as opposed to private? Yeah, certainly understand how public markets work from the perspective of a CEO I managed to how they worked from perspective of an investor and a Ubershiqa graduate But from the lens of being a CEO of a public company and dealing with I'm particularly activist investors because I always thought activists investors were a good thing that they would hold companies accountable And they would help on leash value. I was of that frame of mind that's a whole bad management teams more accountable and they'll help investors out what I didn't realize is that it's really a racket Because they can operate in ways that if I a CEO operated I would be in jail By their behavior they basically Great volatility and they create inside information because they know that they're creating the volatility in ways that isn't transparent The public markets when they create the volatility if they know it's coming from them Then they know how to trade in it so if they behave in ways that will lower the stock price They can buy and then they could almost counter what creative volatility and the stock goes back up to where it should be And they could rinse repeat that and they could cause tension in the management team They could cause over reactions management team which create trading opportunities The activists weren't really unleashing value. They were creating volatility that they could trade into and But I also learned was that they could do that in cooots with private equity investors or public investors By walking this fine line between signaling to each other In ways that was not illegal for say because it wasn't they just could read each other's body language It's kind of a primary use word racket like I know if this activist does this here's how I should interpret it So I'll do that and if I use these words they'll know what I really want them to do and they'll do that And they know how to scratch each other's back and benefit and learn that only when you're in the inside and seeing it happen Wow okay the activist piece any other Skills and the network actually I'm curious about so I feel like your network changes the public company CEO I'm very convinced the sort of network with other public companies. He owes I think it's worth the drain at time As a public company CEO you could fall in the trap of better way too much time doing the things that analysts want you to do and the market once you do And that's a distraction from running the business if I was doing over again the other thing I would do is Say a lot less tension To what a public company CEO is supposed to do I'm gonna go to ball street after I do earnings call I'm gonna be with investors and I'm gonna get go to JP Morgan's conference Goldens conference listen. I'm gonna run the business. I'm gonna tell you once a quarter how we're doing But I'm not gonna distract myself from my CFO or any of us and trying to appease the market If we deliver results we'll get rewarded for it But it's we need to focus on running the business not not getting distracted any other advice for a first-time public company CEO Think how before you really want to do it because there is big tax that comes with being a public company So that yeah, this job in the world is it? No, but at the same time it's like the big leagues. There's big rewards with being public companies CEO from a Pride standpoint and from a career standpoint and there are public companies to be run and it can be quite lucrative if that's what you care about Some of the bigger companies are public companies. There's just pros and cons Take our harder after you got public you invited a lot more competition here on the full radar More fun to start investing in the space other roll-ups emerged. When do you know it's time to sell? Well, I go in that one in the book so more buffet gives some good advice to that When there's a lot of buyers you should be a seller So you got to go with the market. So I saw what was happening I saw the infrastructure money flowing into our space all the cap information all the eagerness to buy Zeyla like assets and it's like okay Advantage that find those who want to be buyers and sell don't feel like you Can't sell the company doesn't need to be a public company. You don't need to be CEO In fact, I was ready to move on anyways. If it's a frothy market, if it's time where buyers are eager to buy, that's the time you should be eager to sell. So, I had to be the seller as opposed to be the buyer and take advantage of that opportunity that was the best interest of our shareholders. In fact, it was the best interest for me too because it was time for me to move on. Did you sense, like, returns were compressing, were there any kind of indicators? Yeah, no, absolutely. Because the value creation math that we would always do, as I was saying earlier, we were doing that math in the past and we could just see even before it happened that the value was stepping up and it was pretty straightforward math and then we could see the republic that it wasn't that our stock price was wrong. It was that our value creation engine had slowed down and if your value creation slowed down, you shouldn't expect your stock to keep going up. So, yeah, we weren't creating value, but it pace that we were and others thought they could come in and do a better job. So, as ever, paying us for the privilege of having the opportunity, we should sell. You don't have time to hunt through generic resources or wait for the next conference. The M&A Science Intelligence Hub gives you battle-tested playbooks from over 400 deal makers, instantly tailored to your role and deal stage. Whether in diligence, integration, or anywhere in between, get the framework that fits right now. Did they come to the formal decision? We should sell the company that we wrote in your process or what that looked like. I was jinnying up interest, you could signal that as well. So, I knew how the signal that we were opened and was interest brewing and I can remember if we ran a formal process out of the gate or not, but we definitely were signaling that with all the large infrastructure funds out there and they're paying higher multiples than we were trading for, that we would be open to. Is that when you had the activists coming? Yeah, activists were in the equation as well. That isn't what triggered us to sell, but it certainly was part of it. The Carl Aiken was a different story that I was part of, that was I tell in the book and that was a situation where there were opportunities to learn by being part of something. I don't know if I want them to sell us or not, but it's fun to be part of this because it was definitely an opportunity to interject ourselves and he was behaving in a very hostile way toward other shareholders of what was called exo communications because he was trying to get out right control and he was a master, so he was playing all kinds of games, the Russell Control. But we were playing some games as well as I tell in the book. And again, that's all backed by because it was a public company. You can reference all SEC filings, which I did when I was telling the book and I was like, "Wow, I forgot that this is how this played out, but that was before we sold." That's it, of course. But there was surprises on that story when you did. Yes. That's like, wow, that's crazy. How did the cell process go? Was it competitive and. Yeah, I got really crazy because we had a certain price in mind and a group of investors that I was friendly with at the time came together and they met our price and they needed to do diligence. And that, in fact, they brought on several members of our former CEO team as advisors that was a new period in industry that's continued to stay where the really big infrastructure and private equity funds will make it very lucrative for people used to be operators, to be advisors to them. They get paid a whole bunch of money and don't have to do that much work. They were really trying to almost corner the market's way played out. What I mean by that is they brought a consortium together that was most of everyone who was in a position to buy an asset of the size of the sale and the space because we were one the biggest take private and the history of take private at the time. There's been some bigger ones since then. That they were number two ever when it finally happened and there wasn't capital formation at that stage that there was soon thereafter. So the private equity firms had to join together to do it. There wasn't one or two who could do it easily on their own. We had the kind of whole lineup. We had Blackstone leading it and Carlisle I think was part of it and you look at it. It was multi major major investors including my lead series B and my lead series C. Vestors were part of that group people I was really close to. So I was going to find a dandy until some of the bad actors there were starting to work with the activists. They saw an opportunity to get it for less than $35 to share. That was the price we agreed on. And then they were coming back and saying all the stuff and diligence. We're not going to get there and get tell they were starting to signal that they were in a comeback and re-trade the deal the deeper we got. But while they were going through that they also tried to lock up all the sources of debt to do a deal the size. So basically they were setting it up so that there was zero chance there could be an alternative bid. There wasn't any strategic involved. So they were courting the market. They were locking up all the debt sources. They can have sign agreements that they couldn't support any other bid. People saw the sources of equity leaving us with no other choice. So they would even oversubscribe it intentionally. Yes. And deliberately and knowing that there was anywhere else to go seemingly. And that would have been fine if they would have paid $35 to share because we wanted to sell it. But it wasn't fine if then they started to get greedy and started to then try to lower the price and make it sound like it was our fault because this was different than that was different. And okay, but 35 is the price. So then they would use activist pressure to try to make it so that we could just say no to the deal would be very hard. For us just a back down so we're not selling it because you lower the price. And it was dragging on and stuff. But I had to work really hard to get an alternative deal. So I played really big role in lining up two companies that typically wouldn't work with each other. One would only do deals by themselves. But they couldn't afford this. It's too big for them by themselves. We don't ever work with partners. The other one didn't usually work with partners either and they weren't even big enough to partner with the other one. But I somehow got them to point where they were willing to work together and then they offered an alternative bid. Then it became kind of a really crazy process. So I tell the story in the book from the perspective of Aesop's got a table where some guys walking down in the sun and the wind make a bet. Wind says I think I could get that guy to take this coat off. So they make a bet and the wind goes first. So the wind creates all this torrent wind and howling wind and all the guy does is clutch his coat tighter because he doesn't want the wind to blow off his coat. All the sun then comes in and just makes it really odd and the guy picks off his coat. It's hot and he wants to take his coat off. So the sun won the bet. So I described the one who was being very hostile as being the wind trying to force me to do something I didn't want to do. Force us aboard. And then the other bidders were the sun. And I wanted to work with us and stick to the price and the sun, which was second consortium and a prevailing in the field. Crazy story I tell in detail in the book. Yeah, it's a really good one. It was a group of p-firms that ended up coming together in like the second largest in the world right now. Yes. EQT, the second largest in the world, which ironically this is too large for them to do at the time. And now they could do it by themselves in a heartbeat. My favorite part of the book was actually the appendix is you have two owners manual and this view on IRR. Owners manual. Is that more of like a reflection of here's the key ways of operating a business where was it? I developed that beginning and sale. So Warren Buffett publishes an owner's manuals by Berkshire Hathaway. And what does it mean? Owners manual Tim is like, well, if you bought a lawnmower, you get an owner's manual to tell you how to work the lawnmower. If you buy Berkshire Hathaway stock, don't you think I should give you an owner's manual? Now you're an owner of my stock. Here's how this works. So he writes this owner's manual and he updates it every few years saying, here's how I'm going to run the business. And I want you to know that so that if you want to own my stock, you know what you're going into. You don't like it. Don't own my stock. But this is what I'm going to do. And he articulates it. So I had the inspiration that I should have an owner's manual that I could share with investors. I could share with my employees. I could share with people who gave us debt saying, this is how we're going to run the business. And it's the way of holding ourselves accountable to. And they talked about nine or so principles of what you should expect if you're a partner of ours. Here's what we're going to go about making decisions and why and how we're going to think about the business. But that's what I took. I took one of the old versions of that, cleaned it up a little bit and put it in a appendix. A little more than company values that you see everybody have. It was you get a little more in depth about how we're going to operate this business and what to expect if you're going to participate in this company. And it was important because remember we were coming off the Tellcommele town where the trust between management teams and investors was destroyed. People went to jail. They went to jail for doing things that were fraudulent and trying to deceive their investors. And I wanted investors to get over that period and be able to trust the management team that we're not going to do things that were done in the past to create illusions of value. We're going to be committed to true value creation. And here's how we're going to go about doing that. So it was maybe overkill from the lens of the future. But from the time it meant a ton to our investors and then a ton to our management team. Now I put the management team into this and this is how we're going to operate. This leads to equity value creation model that you came up with. I want to break it down tactically so I can apply it in my business. You had this view that at the end of the day investors was only one metric to measure the performance and sort of able to IR. And you had this view that why is it at the end of the exit that you calculate IR? Why is it this a continuous metric that we all know? We're working towards when did that come up? It actually came out of a little bit of stress. And what I mean by that is every man should we'll say our number one objective is to create value for our shareholder. And think of this as more developed companies maybe not pure startups, but private or public, we are committed to value creation for our shareholder. They all say that. right? Yes. Okay. Well, how do you measure that? Then they're looking like, what do you mean? It's a stock price. Yeah, but if the stock price is down, you say that the markets are wrong. And if it's up, you say, that's because you're a great management team and how much value, but then when it's down again, you say, that's not our fault. It's the market doesn't know what we're doing. So the stock price isn't, that's not measuring value creation is where Buffon often says, that's a voting booth. It's not a measuring tool. It's not a scale. You need a true scale of how to measure value creation. If your stock price isn't that, but if you're private, you don't even have stock price. So you're saying you're paying value to measure values. Like, yeah, we have a budget every year that we negotiate with our board and it's got revenue targets, go even dot targets, go capital targets. Okay. So you got like targets that measure in a value creation. If you achieve your plan, how much value did you create? And they look like, I don't know what you're talking about. No one, I mean, it sounds crazy, but no one measures value creation. It's the craziest thing until you think about it. Yeah, no one may register it except, you know, who does measure it? Harvard equity firms. Right? They do it every quarter. Every quarter, they measure value creation. In fact, it's even regulated that they have to do it now. So what they do, they have a very simple process. I've got 10 companies in my portfolio. I know how much I invest in each of those companies. That's how much I put in. I invested 10 million this one and 5 million that one. And every quarter, I go through process to say, what do I think my investment is worth? When I'm doing it as a truly honest way, it's because I want to know approximate what the answer is. So I look at one of the companies and I look at what's the best metric used to estimate the value of that company and through some businesses like our business, even down multiple is the first measure. If I take my EBITDA and multiply by 12, that's a good approximation for the value of the business. If my EBITDA is 100 million and for that business, 12 is approximate multiple, I know the business is worth about 1.2 billion. So that's at a point in time. I could look backwards in time and say, okay, a year ago when I did the same math, it was worth a billion. I could also look forward to if the management team hits their budget. I don't know if they will or won't, but if that budget, they put in me, if I run the same math, it'll be worth 1.4 billion a year from now. Okay, so the business went from 1 billion to 1.2 to 1.4 in terms of what's worth. So does that mean you created value? Not necessarily because that just tells you what the business is worth at three different points in time. It's an important number, but it doesn't tell you if it created value because if I got from there, because I burned a bunch of cash in the meantime, yes, worth 1.4 billion, but you invested 500 million more because you bought a company. That's why you're worth more. I didn't create value. I lost value because I couldn't 500 million more and it's only worth 200 million. I went backwards. So the same simple math they do for each of their companies and for their portfolio, you could take that exact same math and apply it to the operation of the business. The only big innovation, the big light bulb is I just need to take their methodology that they use when they're valuing portfolio and apply it to the lens of your running the business. You could look at that backwards in time and see how much value creation took place historically, but you could also look at it for in time. If I make my plan for the next three or four quarters, so I know how my EBITDAs can change and how much cash I'm going to burn in the process, I can show whether value created. Then if I can normalize that for debt, then I can see how much equity value I created because part of it might go to debt holders, equity holders. You could do that over time and it will correlate really well with this. Exactly. Exactly. You're just doing it as an exercise. We all do it when we're looking at business. I'm going to do a five year plan for either starting a business or acquiring a business or a five year strategic model. It's the exact same math, but you're using it as a real time metric. Do your metrics change? We use the tech as example right now. It's got a two-shift in a different direction. If you had this model change instead of the 12x EBITDA depending on the market, would you adjust that? Now we probably got to start using 10x because things are different. You have to be honest in your assessment of what approximately the bright EBITDA multiplies and you got to realize that that's not stagnant over time, nor is it externally driven over time. It has more to do with the growth rate in your value creation. It's a little bit circular. If you do your value creation math and you're creating value at 40% a year, which we were, but that tells you if you had conviction, you should be willing to buy that asset a lot more money than 12x even now. You should be willing to buy it for 20 times because you're going to catch up to that 12x but then a year or two that's going to be a signal that you're probably using the EBITDA multiple that is lower than what a rational buyer would willing to pay you for the business. But the same is true the other way. If you can't demonstrate value creation at a 12x multiple, no one's going to give you a 12x multiple for the business because it's not trading value when a buyer really looks at it if they're savvy enough to understand what they're buying. They're going to be like, "It's not really worth 12 times." So you got to pay attention to your growth rates, not just a revenue but your growth rate, really, of value creation itself. But usually those are tight ranges and if you're preparing your equity value at one period to next period, you're using the same multiple. It doesn't matter if you exactly write on the multiple. Whether it was 10x, 12x, 14x, it's really the change of it that you care. And that's what's the change of it that's called IRR. It's changing at 20%, one period to another. In that period is one year, that's 20% IRR. It's changing at 20% over two years, that's about 10% IRR. So the IRR is the percent of change in value creation and equity value create is the absolute change I went from a billion to 1.2 billion and that was a 20% increase. But it's the exact same amount that every private equity firm uses. Now it's hard to do that in, you know, like you can't do that with the quantum business right now because quantum business says that's more about projecting into the future what you think quantum might be worth. That's much more subjective. But for businesses that are any were close to trading based on the financial performance, you can do it and it doesn't have to give it down multiple. It's like, what's the norm for relating value to a metric? The precision of that multiple matters not much. You gotta be in the right ballpark. It's really that keeping a constant period of period and seeing if with the constant multiple are you creating value and so at what pace. Once you do that, it comes a math exercise and you use it to judge is this an appropriate budget going forward? Because it takes all the silliness out of budget. It's funny because we never had budget set Dale, which is really crazy. There was never like a negotiated budget with the board and then measurement against how you did against budget. That was never part of our vernacular because we didn't really care how we performed against budget. What we cared about is when the math played out. Is the value creation equations saying that we're worth a lot more? It was years before our investors even figured out that, you know what, we're not even having a conversation about budget. They didn't you care because what they do we were is where I'm conversation about financial performance. But it was never really against budget. It was more in an absolute context than after I sold Dale about two years afterwards. Funny. I get along and really good friends with the CEO. They lost all these principles when I left. He tried to explain to me like a year and a half after he took over the companies. Did you realize that sale never really had budgets? And I'm looking at him like you're asking me about our sale random for 14 years of I realized that sale didn't have a budget. I'm like that's true. We ain't never had budgets. Yeah, of course I knew that. This is because you just kept him distracted with the I.R. They wanted to know if their investment was worth a lot more now than it was before. He gave a clean formula. It's calculated and this is. And what was nice they even started to laugh. I was a couple that laughed in a respectful way because they're like every other portfolio company we got to do all this math ourselves about what the company's not worth compared to before. You just give us that math and all we got to do is look at and see if we agree. And then we just repeat it. So you're even doing the work for us in terms of how we value our investment in sale. And I'm going to try it. I got a business that run now that's right at 9.9 million AR are boosts trap the business. So I could probably figure it out. Yeah, I got about 1.6 million that was put in over time. Do you got some debt paid off the debt? But then we'll probably do a recap at some point. Yeah. Getting that. It becomes very motivating. It wants people to understand it and buy into it. All decision-making is not. With budgets, people on negotiate budgets. I'm the CEO and I want my revenue to argue with lower so I could suppress the revenue and get my bonus. That what you want? The lower revenue target is your motivation. I mean, but if you're saying them by like I'll give you a bigger bonus if you be revenue target, they're going to want a negotiate for as low revenue target as possible as human nature. It removes all that kind of games and ship out of the system. Would you incentivize on having that equity value creation? So yeah, that's all we have to incentivize on. Oh, it's just all the loans based on that. And then it's tiered that we have a pretty much read this. Yeah, that mask that we created a lot of value. It wants to stay out wonderful. And now everyone had a lot of equity too. So it would be correlated equity, but yeah, all the financial rewards including to get promoted. And then we end up with a bunch of people new out of run businesses, which in our industry that wasn't the norm because in our industry, it was like, you know how to do operations, you knew how to sell, you knew how to be a CFO, you knew how to be an engineer, but no one knew how to run a business because no one ran a business. But that's why so many former zeal people run companies right now in our business because they all learned how to really be business people. And they took that and now they all, like I said, I was just came back from that trade show, which on the Goldo's anymore. And I had a bunch of people come up to me. If they were on East Coast, they would liken it to the Balochect tree. Like that, you must have so much pride. Look at this Balochect tree. It was on the West Coast. It was the Shanan tree or whatever. Pulling the industry now appreciate how much true management talent has come out of the system and they're running companies and they're creating no response value for lots of teams, largely former zeal teams and for investors. For your wrap up, I want to talk about which you're up to now. But let's go through that exit because you got paid a lot, but you've also meant a lot of millionaires in that process, which is extremely successful exit. What do you do with the money? I keep asking a lot of entrepreneurs as question because I'm trying to play it through because I'm eventually having exit and whatnot. I'm like, what do you actually do with the money? I don't tell me, I mean, I will talk a little bit about taking money to make more money, but like, what do you actually do with the money? What you should do is you should be wanting to have a positive impact with your wealth. What you shouldn't do is just hoard it. Because if you hoard it, it just sits in some bank account somewhere doing nothing. But if you put it to work in different ways and ways that reward and give opportunity to others and help improve whatever community you care most about, then you're doing something good with your money. And we now have what is a single family office if I doesn't look like one externally facing. We have a very clear mission. It's to be the most catalytic tech investor in Colorado with the name toward helping Colorado be the top ecosystem for tech investing between the West Coast and the Northeast. So we have a clarity of mission and it applies not just to how we invest our cap bill, but it also implies to how we navigate our foundation. I was able to fund a pretty sizable foundation and we use that to help create that culture and environment that is both good for the community and also helps bolster our natural environment. So it's consistent with our purpose. So Endeavour Global is the top organization on profit for scale up tech entrepreneurs globally, operational in 45 countries or more. We launched Ever Colorado as part of that and Endeavour Colorado is one of the top performing offices. So that's all about helping those who are in their scale journey already get to be really effective, but it's also to be role models for those people on what do you do once you have success? How do you give back to the community? We very active with Sundance Film Festival, which is moving to Boulder. We have launched Boulder Roots Music Fest, which we see as a compliment to Sundance, opposite time of the year, using music as a thing but build an entrepreneurial ecosystem around that, support Colorado startup week, Boulder startup week. So we lean into a lot of community activities, but then we invest, we're very active investors in Colorado tech companies. When we invest, make no mistake about it, we're investing as capitalists, we're investing to earn outsized returns. These are two things. So the Crucio Ventures is sort of investment vehicle and then listen off for profit. It's called Crucio Foundation. So Crucio Foundation separate, two different things. Yes and no, because it's all part of the same mission. So we're all serving the same mission of being the most catalytic and by catalytic, that's an importantly chosen word. Doesn't mean we want to be the biggest, doesn't mean we want to be the best, doesn't mean we want to be glorified, as anything it means we want to help the ecosystem, we want to help other investors, we want to help entrepreneurial ecosystem in general, and certainly we want to help our own portfolio companies. We want to really be catalytic for the community of Colorado, Boulder, in particular, but Colorado in what is really important. I mean, you got a thriving tech ecosystem, that's good for everyone. If you don't, you're in deep trouble, especially with what AI is going to do to everything. You're in a geography that does not have a thriving tech ecosystem. I don't know what you're going to do to have good schools, to have good healthcare system, to have people be able to live comfortably, particularly with the disruption that's going to take place with AI. So we believe a thriving tech ecosystem is not for the entrepreneurs, it's for everyone else, it's for the community. Very cool. I like the really proactive on making an impact. I read a lot of billionaire biographies, all the names you've heard of and you see this common pattern, it's around 70. They got your worth billions, the billions, and then it's all better. Do some philanthropy and you're just cutting big checks to different endowments and whatnot, but you're taking rain and actually seeing things through of personal dollars to impact that you're making. Looking backwards in time, people thought doing good was giving money to philanthropy, and certainly there's an aspect of that. But what's contributing to positive forces in the world is not philanthropy or philanthropy is, but that's not the main it. It's tech. Make no mistake about there are less people in the world today by far who are living under the poverty line, that people are living longer, they're living healthier, they're living in more comfortable situations, and every corner of the globe, not because of philanthropy, but because of technology. That's kind of something that we still have to make sense of, because most people think that the gap between those who have money and those who don't is getting wider and in bucket seat belts is going to get much wider in the future because of technology, but it's that same technology, that same wealth, yeah, that is the fuel to making everyone's life better. In general, people are more healthy across the globe, they're more educated across the globe, there's more people rights across the globe, less poverty across the globe, that at any time in human history buy a lot, and that's fueled by technology, evolution, not anything else. Any big on tech? What kind of deals you guys doing? You mentioned Quantum, I talked to one of your associates, we talked a little bit about space. Has it the money to categories? You're going to highlight some investments you're super proud of? We got a really cool portfolio and it's performing really well, and that's a surprise, you were in my head, I was thinking of this, reading the book, and like it must be like just funding a bunch of rollups right now. No, you absolutely are not. Now, where are you going to get any rollups? We're 100% focused now on Colorado. You're going to have portfolios, you'll see things outside of Colorado. Colorado's actually been known as a pretty big space hub. Shit, yeah, it is. It's a big hub for digital infrastructures, thanks to our legacy of level three and Zayl, but others as well. Huge hub for like data centers and Luminon, Zayl, or still headquartered here. Digital infrastructure is a huge ecosystem, space tech. This is one of the biggest aerospace and space tech markets period, and Quantum is gigantic and we're very active there. There's a content innovation and creative tech scene that's beginning to gain more momentum out here. There's energy innovation, ecosystem out here. There's outdoor lifestyle, even natural food. This is a historically important market there. Agriculture, technology, regen is big out here. So, Colorado's a big playground for lots of different sectors. Most markets outside of Northeast and Bay Area are known for one or two things. We're leaders in a lot of areas and and we get a lot of the best deals come our way. So, we have six quantum investments. One's already accident. One public two weeks ago had a huge valuation and that was been one of our bigger investments. And we have the other quantum companies that are preferred and really well. In fact, we're hosting. We cruise ventures are hosting a film premiere this coming Monday. So, it would have already happened by the time you dropped this podcast called Our Quantum Future. It was filmed all over the world, but we're premiering it right here in Boulder because of Boulder's and Colorado's prominent role in quantum. We're really excited about what we're doing. We got some real cool AI investments that are here local that are going to unveil themselves in the next year or two that are really compelling. So, yeah, we've got a lot of cool stuff going on. Yeah, some space deals too. Space deals, yeah, we're the largest and lead investor of agile space industry which makes in-space thrusters and in-space tanks that's doing really well. We're an investor in this company called Boom Super Sonic, which is mission is to build. Oh, you know this company. What's crazy about this company and we're sizable investors in it is they first failed in their quest to build Super Sonic engines and all that ran out of money, all the ran out of support, all that had to close their doors, in part because Rolls Royce was going to build their engine and Rolls Royce not only pulled out, but they pulled out really publicly that left the company reeling. So, the entrepreneur is a really greedy entrepreneur, which is so important. So, he said, we're going to go build our own engine. Have the first Super Sonic claim. Who does it? They go build the whole engine, run out of money, run out of support. It's not quite done and and led by some really prominent Silicon Valley investors with names like Sam Altman, so a prominent group there. They let a recap of the company that we participate in and they discovered that engine that turbine that they're building for the Super Sonic plane is ideal for AI data centers, better than state of the art by a lot and the state of our turbines are in really short supply. You can't get them for like five years. So, now they're selling these engines into that market for contract values of like lots and lots of money and it's going to be a huge success story. So, it's still going to build the engines. That's going to fund. They've built out of the Super Sonic commercial jets, but they're going to fund most of that through commercial deals, not through the need to raise more money. I think it will be successful. It's got to still get there, but it'll be one of the most interesting pivots since SpaceX decided to do Starling. When they launch commercial, I'm going to pitch up for some just going to take it so you know absolutely. We're going to have to wait five years for that first time. I can show you the engine and operation next year, I think. Okay, so you got investments. You're investing a lot back in the community, plan therapy. I want to know like what do you do for fun? Like the money, buy a jet, what do you actually do with the money? What was the fun you did with the money? Crazily. I've been going off in a long time. My three-vests call-frames have been in less two months. It's almost big, absolutely no sense. Now because I'm taking a bunch of lessons, but I just started to click at least for three rounds. My creative side has come out. So, the book I wrote a song, which is crazy, and it was for accidental. That kept produced. I do the podcast. The Bear Roars, the bear roars, my nickname the bear, and it's a really cool podcast. It's got a lot of traction, and she's definitely check it out. Diverse. I went through it. I actually listened to get some contacts to one of them, but yeah, you just don't follow one theme. It's very, very around the community. Yeah, the primary theme is the cool people doing really cool things in Colorado. And a lot of it is tech entrepreneurs or tech investors, but there's also some of our cultural icons, but then there's also a theme around the bandwidth industry and people telling stories. the band with books, so joined lived experiences where they're telling how it played out from their perspectives. It's kind of got the two-pronged approach, but a lot of iconic people on there. But we also have a really nice house on the beach in Kabul, a really exclusive pub that's very social club. We spend about two and a half months there. I'm busy all the time, but I'm doing stuff I want to be doing for the most part. - Sun, golf, book, podcast. - Song, and "Holo Roots Music Pass," which is going to be a gift that we're able to give to Holder and Colorado, and hopefully much broader than that, that we think can grow into being an iconic annual, not just music event, but South by Southwest structure around it that is really designed to appeal to investors, particularly tech investors, tech entrepreneurs, as well as the broader cultural arts community in and around Holder, Colorado, and beyond. - I'd like you for a ticket for that. We'll get it for the-- - Do it. - Any science crowd? - Yeah. - It's going to be a blood event. - This August, the weekend before Labor Day, weekend. Mark your calendars. - August. - Come to Boulder. - Later Day. Okay, it's right on my birthday. There you go. - Be part of a Boulder Roots Music Pass. Look it up. - I got to ask, what's the craziest thing you've seen in everyday? - Oh, the craziest thing I've seen in everyday. Let's see. Good deals that we've done. Probably the craziest one was the ICG one we did, because that thing was certainly the above-net story, that's the craziest story, and definitely worth looking at that. But the ICG where this is a company that had 30 million of remaining cash, no access to debt, by the own emission was burning 8 million a month. It's to do the math. What's 30 divided by 8? It's a short period of time. And that was when we started talking. Okay, so they got no access to somebody, 30 million, burning 8 million a month, do the math. We were able to buy the company. We only gave them 8.7 million dollars by the company. Most of that didn't go to their burn rate. It went to pay the lawyers, the bankers, whatever else was involved. So almost none of that money went in the company. We never have to put a dollar in that company. And we got to cash will post it. And they're still like, okay, that makes no sense. I didn't even buy the company until you were deep into that, like, remaining burn days. But we just, while we were buying the company, we also restructured a bunch of stuff. And by the time we owned it, the burn rate was down almost nothing. And we brought in some cash from things that we feed up to sell, you know, before we actually owned the company. And we never had to put another dollar. And then a year and a half later, we sold it for 250 million in aggregate. It's like, freaking crazy. It's still like, you're looking like, how do we do that again? But it just happened. We would have meetings with the investors. And we had to call the meetings, what have you done for me lately? And the reason we did is we were making all this value creation for the investors. They knew it. But every meeting wasn't like, wow, you guys did a great job last week. And this last month, never had time for that. They're like, okay, that's great. But that's what was already done. What are you going to do next? What are you going to do for us now? So every time I was like, no one ever saw this coming and everyone just wanted more and more and more. And the craziest thing is, I think we left a lot of money on the tables because we should have sold some of it and kept some of it used that to launch what became Zail because some of those assets would have been really valuable as part of Zail. But oh, well, yeah, this has been great. I appreciate you reaching out. That's the full Zail lifecycle. A thesis formed during a hip surgery recovery, 45 acquisitions, an IPO, an a sale that ranked among the largest take privates in history. The thing that Dan kept coming back to is this, most leadership teams say they're creating value, but they can't actually measure it. The model he built wasn't complicated. It was just honest and that honesty is what cabsayla lined and focused for over a decade. If you want to apply the same thinking to your business, the MNA Science Hub has an equity value creation scorecard. It's built around exactly what Dan described, linking the show notes. Dan's book is bandwidth. It's the longer version of everything you heard across both episodes, operator level detail, no theory, worth your time. Thanks for listening. Here's to the deal. Thank you for taking the time to explore the world of MNA with our podcast. We love hearing feedback. Tag us on a LinkedIn post, add a review on Apple podcasts. We'd love to hear from you. If you need help standing up in MNA function or optimizing one that you already have, we're here to help. And if we can help you, we probably know someone that can get in reach out to me by email, @mapscience.com or you can text me directly at 312-857-3711. If you just want to keep learning at your own pace, visit mapscience.com for a lot more content and resources. That's where you can also subscribe to our newsletter. Again, that's m-a-science.com. Here's to the deal. Views and opinions expressed on MNA science reflect only those individuals and do not reflect the views of any company or entity mentioned or affiliated with any individual. This podcast is purely educational and is not intended to serve as a basis for any investment or financial decisions.