Brien Davis from Partner at Altacrest Capital, with his partners have completed over $3 billion of investments during their 20+ year careers. Today we’ll be talking about their acquisition of Barton Watch Bands, an Austin based consumer product company.
- Brien’s background
- Deal flow (what made them want to acquire Barton watches)
- Why having the founder equity in the business is preferable
- The letter of intent (LOI)
- Structuring of the deal
- Customer experience
- Different types of multiples
Mentioned in this episode:
We are live today on Truth About Exits. I'm joined by Brian Davis Brian's a partner at Altacrest Capital. He and his partners have completed over $3B worth of investments during their 20 plus year careers. Today we'll be talking about their acquisition of Barton watch bands an Austin based e-commerce company. Brien thanks for joining this here on Truth About Exits. Thanks for having me.
A pleasure to be here. Awesome. We met while we were marketing an e-commerce deal recently and we had the opportunity to catch up while you were in Austin for lunch. I got to know you a little bit then and I'd like to introduce you to the listeners. What were you doing before launching Altacrest, then we'll jump into what that is in a minute.
Sure. Altacrest Capital's a little over two years old. As we like to say Altacrest is fairly young but unfortunately we're not. I've got two partners of three of us in total. Two of us worked at Prudential Capital Group for about 15 years together. Tim Laczkowskiand I prior to working at Prudential capital I spent about five years in investment banking doing mergers and acquisitions as well as capital raises and things of that nature. But a majority of my career as I mentioned is at prudential capital group or prudential capital group basically invests the money of prudential into middle market companies. Everybody's got a different definition of what middle market is at Prudential it was getting a little bit larger in terms of deal size relative to when I started in 2004 versus when I left in 2018.
We typically looked at transactions at Prudential that would have EBITDA really anywhere from about $7 million up to a couple hundred million dollars. One of the things that led Tim and I to want to start a Altacrest was as we looked at companies that were smaller they would come across through our deal networks and different intermediaries. We knew to friends different companies that we had called on. We saw a lot of really attractive companies that were a couple million dollars of EBITDA up to $10 million and as the market started to go away from companies that size and large financial services firms such as Prudential Capital we're putting bigger and bigger sums of money to work in larger companies we felt there was a need there.
We used to invest capital in a wide variety of industries. Anything from consumer products to business services to manufacturing and things of that nature. But both Tim and I really wanted to have a tighter industry focus. We both liked consumer products quite a bit and a good friend of ours Rick Sukkar is our third partner spent the vast majority of his career in consumer products. He spent 15 years with JP Morgan primarily in their M&A group helping to sell large consumer product companies. He got tired of the larger financial institution arena. In 2008 went out and started to operate companies. The last of which was a a consumer product company was private equity owned that they really started from start up and grew from there to about $15 - $20MM of revenue.
They really used e-commerce as an important platform to not only grow sales on e-commerce but also in terms of getting into other sales channels as well. As the three of us were talking and had similar interests and similar areas of our career we wanted to do something more entrepreneurial. Altacrest seemed a great idea. We've been fine tuning the strategy ever since. But really spending the majority of our time now focused pretty tightly in on consumer product companies that are either selling primarily through e-commerce or existing what I would call more old school consumer product companies that have perhaps a poor online strategy and something where we can take that and introduce direct to consumer to help them grow and really give the consumer what the products where they want them and how they want to buy them. That's sort of our focus.
I've seen a trend I've just recently moved to the US myself and I have noticed the trend here. I'd noticed that from a file before but it's more evident here once you're in living in the States or spending more time in the states is people actually it seems to be a huge trend of the average person to care about where they get their products from and they want a brand story and they want to talk about the products they buy to all of their friends which is great if you've got a good product to sell but not great if you're a legacy type large brand. Are you seeing a similar trend in consumer behaviour?
Oh I think absolutely. I think that yeah most people that like to think we act logically. Most people make actions based on emotion. I think the buying decision that's clearly there too. People want to relate to the product they're buying and they want to hope that it has the same primary value set that they have whether it's all natural type products that are eco-friendly which is one of our areas of focus. Actually where we just closed our recent transaction or whether it's a brand that they can identify that's socially conscious. Barton that you mentioned earlier we have a couple of different situations where we'll have a particular band watch band that we sell and a portion of the sales go to an identified nonprofit organisation. We think that's important and it's not only important for the brand but we think at the good for society at large. We're happy to jump on that trend as well.
Absolutely. It's nice when trends in the entrepreneurial capitalist industry you'll focus turn towards helping other people as well. It's good for marketing but also good for everyone. It's a win win a true win win which is which is nice. I liked the fact that you guys have a tight focus on consumer products and specifically in e-commerce because obviously that's what we mostly deal in as well. How do you look at these businesses? Let's say Barton when you first looked at the business have and by the way you guys move quick right? You actually just launched a year ago and you've already done three transactions. You guys don't muck around. I like your style. You've mentioned that you were introduced to Barton through through your network. You obviously have a decent network from all those years at Prudential but how many deals do typically look at before making an acquisition? What was it about this business that made it an acquisition target for you?
Yeah we do track how many deals we look at. I don't have the numbers in front of me but it's in a given year we'll look at hundreds of transactions. Then we probably get pretty serious on I would say a couple a month call that mid twenties that we get serious on meaning we're gonna put together some form of indication of interest expressing what we'd be willing to pay for a company and how we would operate it etc. Then from that funnel you get down to maybe three or four letters of intent that get signed and and hopefully you close all of those but it generally leads to closing 75 or 80% of those just depending on what happens in diligence and things of that nature. It's definitely a part of the funnel approach.
But we the way that we approach it from a marketing standpoint is we like relationships and finding situations were usually there's one or two degrees of separation between us and a founder. It's a nice way to provide both people the ability to check the other. Because when you go into these types of transactions occasionally you're buying 100% of the company and the founder goes away. But oftentimes especially in deals that the founder is going to retain a degree of ownership in the business going forward. It's important for us to have a good relationship. A good partnership. In many ways it's a marriage.
I'd love to dig into that just a little bit more where the the approach that you prefer is to have the founder or the owner of the company retain equity. Can you explain how that why that's preferable to you please?
Yeah there's a number of reasons. One is just alignment of interests. When you're buying somebody's company and it could be their baby to use the colloquial phrase but you don't know everything and you can do as much diligence as you can but it's hard to know everything and there's going to be some transition period. If you've got good economic alignment to where that individual still owns a portion of the company usually he or she is much more apt to be helpful. We think that's really a good thing too. The other side of it's true in Barton. It's also true in our recent transaction for organics where in both those situations the owner owns a minority percentage of the company but a meaningful minority they're both visionary type product people. They are passionate about either in the case of Barton watch bands or in the case of Corganics they were passionate about natural based personal care products.
Be it around real pain relief cream are there some other ones that we're going to be issuing soon but they're very good at products with the they tend to not be as good at admittedly is really the sales and marketing function and then some of the finance, administration function. It can be a very good marriage. We're not product people but we are good at sales and marketing and we are good at finance. At least we believe. If that person retains ownership and can still be involved in overseeing a degree of the the product development roadmap that can be a good fit for us.
Okay. Excellent. That makes a lot of sense. We do come across a lot of founders that are more artisinal types where they're just super excited about their product and maybe or you said not great on the sales and marketing side. It's tough to be great at everything that creates a pretty pretty good opportunity. Let's talk about Barton specifically. We talked before at lunch and also before we hit record here about the timeline on this one. I'd to dig into that a little bit. Could you walk us through it. You got the initial introduction you did the kind of background checking to see if this if it was a good fit. You also mentioned something when you said that in your LOI's you you mentioned how you will operate the business and what your your thoughts are around that which I thought was really interesting. We often see competitive environments in e-commerce businesses because there is no usually no fixed location or very easy to move locations. You appeal to a wider buyer pool for the most part. Do you find that that's a competitive advantage to put in your LOI exactly what you're thinking about as far as operationally managing the business and growing the business moving forward?
We do. I mean I think it's a competitive advantage and I think it's also just part of our attempt to be transparent up front and that we can get everybody on board with with how it's going to work. In the Barton situation the founder who did an amazing job growing the business to to where it was he did not want to do the day to day operations anymore. In the letter of intent it was important for us to outline that here's the strategy of the type of individual we're going to get to replace you as CEO. We think that the company's although it's done great in all these areas here's where we think a few things can be augmented. These are some of the skillsets that we gonna to look to bring to do that.
I think it helps especially in a situation where you're you're asking a an owner to retain some ownership in the company post deal if he or she gets more excited about the growth prospects and the in the plan that we're putting in place to achieve that a our proposals usually deemed more attractive and I think B it just demonstrates perhaps a deeper level of thought than than you some other groups that may just throw a number out there just to see if it sticks.
Brien and in the original conversations you mentioned the intro was in August of 2018 which is last year. At the time of recording did you find that information out there or is that fairly boilerplate almost that you you put into the LOI what you're planning to do? Or do you tailor that to the founder and what their needs are?
We have a pretty standard. It starts typically with an indication of interest and even in the indication of interest we may start to outline a good number of those items in terms of how the operational plan will be in addition to the economics of the transaction and the structure. the letter of intent then takes it to the next level. Typically the indication of interest is negotiated back and forth maybe once or twice just to make sure that we're we're all in the same ballpark with regard to how it would work and economically and operationally. Then the letter of intent is really getting down to okay this is what we're going to do. Unless something pops up in due diligence that we were unaware of this is what we're going to close on.
That's important to us to do what we say we're going to do on those aspects. But it's each situation's a little bit different. We have a standard LOI that we do but then there are sections within the LOI that are have to be customised for each deal. That's typically the actual structure of the deal meaning the capitalisation debt versus equity. Also the operational plan can be a little bit different because not every situation are we replacing a CEO sometimes it's the CEO may want to stay on and we may view that individuals being a great person and somebody that we want to get behind. Those are the parts that get a little bit more customised.
I'm kind of bouncing a little bit back and forward here between the Barton example and just in general but there's some really interesting pieces of what you just said. For instance a founder is the CEO and their what they're really looking for as a capital partner as opposed to a buyout and operational takeover how do you view that type of that type of deal? How would you how would you normally structure a deal where the founder is the CEO and they are staying on?
I think that's it's great. I mean if the founder is the same person that's going to stay on because it takes one risk away anytime you have a new person coming in to run the show that opens up transition risk. That's not something that we take lightly because we've seen enough situations where a new CEO can be very disruptive. Despite your best attempts at interviewing and background checking etc with regard to structure and the way we look at as we talked about it earlier nobody can be great at everything. One of the biggest things that we see that happens as companies scale is they go from it's not uncommon, especially in today's world of Amazon to in your first three or four years jump up to $5MM to $10MM of revenue and then you start to become a real company and you're creating real cash flow and you're now trying to figure out how do I scale to $20, $30, $40, $50MM of revenue?
That's it is a bit different. Part of it is just the blocking and tackling of putting in the process and the people to make it all work. Some of the CEOs we deal with have that skill set, some of them are more visionaries and need to be augmented. Anytime you're going to grow it's always a people business. You've gotta think about what you're going to put in there in terms of augmenting the existing capabilities. It doesn't have to be a new CEO. It could be a new chief operating officer or it could be a new head of product development that's just going to oversee vendor management that sort of thing and the supply chain. It's really just doing an analysis around where are the weaknesses, where are the choke points going to be as we grow. Then coming up with a plan for when you inevitably do hit those to try to minimise the disruption that that causes
The most interesting thing to me about what you just said Brien is you didn't mention capital once. Oftentimes when I'm talking to founders that are growing at a super fast rate they think capital is their only problem. But what you just mentioned and rightly is that it's a people business and people really make the difference. That's that's super interesting. How do you look at the capital side of things when it comes to our founder staying on? Obviously it depends what they need as well. Do you typically take a minority stake? Do always want majority. How does that typically work?
For us we always want a majority ownership position. In my former life I've done minority equity transactions and you can do them effectively but it's you typically I'd feel better in larger companies doing minority equity deals than I would and the size that we're dealing at a just because they're more fragile at our size companies are and if things are going awry we need the ability to step in and try to implement change if needed. We tend to control deals and focus on those the the capital structure questions an interesting one. That's where you've just got to you need to have a plan. When you get to see before you get to closing of here's what we think is going to happen.
Projections are always wrong but at least gives you an idea of a roadmap of what could happen. If it does how much capital do we need to deploy that? Then you take into account okay if I need a lot more capital to deploy the growth strategy I need to put less debt on the business. We do typically put debt on our acquisitions but it's what we think of a very prudent level. That's not going to choke any growth. But I would say that's one of the beauties of e-commerce and why we were attracted to it when we launched is they're very capital efficient. Frankly as part of our we've got a criteria or a checklist rather call it 10 or 15 different true attributes of these businesses that we really .
Now you never check all the boxes but if you can check a lot of them that can be good. One of the things for us is really working capital efficiency. As you're growing how much working capital do you need to maintain and grow with you and does that choke off your cash flow? But it's just something you have to balance carefully. It's something we spent a lot of time on to try and make sure we get right on the front end. That's really interesting. Could you share any of your other points on the checklist? Yeah I mean we have certain financial characteristics that we. Obviously higher gross margin businesses are obviously favoured. Today's world especially for sale on amazon you've got to pay your sellers commission selling commission as well as we typically do FBA.
I mean that can be 30 points off revenue right there. The higher your gross margin percentages for your cost to get sold it gives you more ability to absorb the Amazon fees or affiliate marketing fees etc and still have plenty of money for for advertising spend and payroll increases that are gonna need to occur. We that well we the the working capital dynamics I mentioned are are important to us. Then it gets into more qualitative ideas such as we really prefer brands as opposed to just products. That's a very esoteric distinction between the two. But the biggest thing I think that that how you can define that is repeat customers. If you have a lot of repeat customers I think you're you're starting to show that you're a brand even if you're a very small company you're getting some brand loyalty by people coming back. That's one of the major areas that we focus on in terms of just some of the analytics that we look at.
I think Barton would have ticked those boxes for sure. I mean you can't go to the website and not want to buy more than one thing if you're if you're a watch guy you want you want four or five or you'll come back they look very high quality high quality pieces. With this deal specifically with the founder staying on and more of a or what does his role day to day look now that you've acquired and take it over put in a new CEO into the business?
As I mentioned he still owns a portion of the company. He has a seat on the board of directors and he tends all the board meetings where we discuss strategy and growth plans. He's also frankly just the trusted advisor. He a really bright individual, he's a passionate a watch person, he's got great product development ideas. We tend to run our product roadmap our product development roadmap by him to get his thoughts around it to as a watch counsir what would be in the marketplace. That's he enjoys those parts of the business but that's we're still we closed on the transaction last November. New CEO came in early March. A lot of the transition is over in terms of handing off the day to day responsibilities but there's still a phone call every week or two just asking some questions and getting some advice. We appreciate it cause he's he's been a really good partner.
Does was part of his reason for selling the business to go do something else or was he looking to just pull back from operations and take some time for himself. What was his main motivation and selling the business?
I think all of those I think as anybody who's been an operator of a business can tell you there's a lot of parts of it are not very glamorous and it's just a lot of hard work. Doing some of the tedious tasks that need to be done to to execute well. I think he was a little bit of that. I think he wanted to diversify his net worth. He had built a nice business 99.5% of his net worth was tied up in that business. He was able to get a nice check in our transaction yet he still owns a portion of that if we're successful and growing it as we hope he'll get another bite of the apple if and when we ever sell it. That was of interest to him. Then I think also he wanted to do some some different entrepreneurial activities. I don't know exactly what he's focused on right now but he had mentioned anything from real estate to all sorts of he's a smart guy with a lot of different interests. I'm sure he's working through that now to figure out exactly what he wants to do.
Most of our clients mention real estate when they when they think about diversification there's something about the online world and real estate that is kind of feels polar opposite. One of my friends builds a lot of affiliate based websites and I was at a wedding with him. Yeah. We were sitting next to each other and we're talking about a business back and forth. He said I take my fake money when he sells websites and puts it into real assets. I thought that was a funny way to think about it. Obviously the companies you're acquiring that are real brands and have have presence I wouldn't put in the class of fake money. But yeah that's a bit of a different thing. But the concept is very interesting to me.
No it is interesting. Hopefully we're generating real cash that's going in the bank. I haven't nobody's told me yet. If it's fake cash though that'd be a problem.
You've mentioned bite at the apple and this is something that a lot of private equity groups talk about as a pitch basically to keep the foundation engaged and retaining equity moving forward for those reasons you mentioned before but also to reduce risk. When you think about a company Barton is the the main goal to grow and sell or is it more of a longer term to you and see what the best options are at that time?
The good thing is I mean our structure is we're not a traditional fund structure that's got a finite life to it where you've got to sell a business after a certain period of time to to return capital back to shareholders. That being said we do we're looking to optimise the investment for our shareholders that have put money into into this transaction. These businesses are very interesting in that you can grow them. There's a good market to sell them into as they get bigger because this tends to be the part of a consumer land that's that is growing fast. We see a number of folks being active in acquiring them. The other part of these businesses that are really nice is they generate a lot of good free cash flow. If you're operating them efficiently and good free cash flow can can lead to a lot of dividends and distributions to shareholders. That's another way to get money back to the shareholders. I would I wouldn't be surprised if if we ultimately sold Barton at some point but right now we're solely focused on on growing it and continuing to be efficient in in generating cash flow and and we'll see what happens over time.
How do you think about risk? A lot of the companies that we come across you mentioned Amazon before. It's quite the behemoth of the sales and marketing for your business and for a small brand and can create a a pretty sizable business in a short period of time. How do you view a business that say is majority of their revenue generated through one source, amazon?
It's a big risk. I mean there's there's no doubt about it but it's one that we think that can be managed. We do think having some diversification is important a lot of these businesses that may be a hundred percent Amazon or well over 80% Amazon we do to try to diversify their sales channels to a degree selling depending on the the type of product. Some of them sell very well on their own website. Barton would be a good example of that. To the extent that we can move more revenue to the website either through affiliate marketing better use of social media etc that can be a great thing and that can help de-risk our reliance on Amazon and we we definitely look to do that.
That being said Amazon I forget the last stat but I think they're roughly 50% of e-commerce right now. Yeah it's hard to get completely away from them. Frankly from a we also think about it from what does the customer want? Where does the customer want to buy this product? Do they want to see it on Instagram and just click and buy it? Do they want to they're on Amazon anyway and they want to buy it there. We're trying to make sure that we're giving a good customer experience such that they want to keep buying them and we make it easy for them to do that.
I love that approach. That's the first time I've heard someone on the buy side talk about customer experience. That's really important right? That's what it all boils down to is who's actually buying the products. I've had a lot of interesting conversations recently with people that are really negative on retail through their own experience mind you either through losing money or barely breaking even on retail channels but e-commerce worldwide is only about 20% of sales across the board. There's still a lot of volume that's bought in store and you said go where the customers are on top of direct to consumer and obviously Amazon if that's where the base is how do you guys look at at other channels specifically retail and the wholesale distribution?
Yeah. I think for most of the young brands it's important to build up your presence online either direct to consumer through Amazon and and to do it in a very profitable way such that you can survive and thrive without big box retailers or whatever channel of retailer that you need to go through on the brick and mortar side. I think a lot of what gets companies in trouble especially when they're small and young is is the allure of the Walmart sale or the allure of CVS coming in and and you can find yourself with a large customer concentration. You can find yourself bidding it down to a margin level that you think's acceptable but then you get nickeled and dimed and it gets really low.
We just to do whatever we can to de-risk that by having strength in your online areas your e-commerce areas DTC, ETC or Amazon. That way it's just a different conversation. When you're talking to the brick and mortar retailers and it's not as one sided in terms of I'll put you in 500 target stores and now your your whole existence is boned to maintaining that target order and hoping in three months that they re up and in order more. The other part of is I think obviously you lose the data when you're going through brick and mortar. I think for a young consumer brand one of the keys is to be really good at at your targeted marketing that your return on ad spends really good.
It's just harder to do that when you don't own the end customer through. We think that it's a great place to go eventually. Brick and mortar is and wholesale traditional wholesale distribution. But it's not where we tend to want to focus on the front end and we would to make sure we're sort of mass before we spend too many resources on on those channels. That's the general idea. There's certain product sets that actually do do really well in retail and yeah we would entertain going there first. But I would say vast majority of what we look at and work on we're bias towards staying in e-commerce as as long as it makes sense.
Brien this was awesome. The last question I have is around multiples. Obviously we wont talk about those specific multiple in in any specific deal but part of the attraction to the e-commerce space surely as the multiples. What multiples a typically seeing and how does that differ from the middle market type multiples you are dealing with that Prudential?
Yeah I think multiples are funny thing. Yeah they're opinions. Everybody's got one. I definitely I worry about the country club effect of talking to someone and if him or her telling you I sold my business for 15x EBITDA and then everybody thinks their company's worth 15x EBITDA because most are not, multiples range very widely I would say. We see anything from and we value things based on a multiple of EBITDA. We're not big fans of multiple of revenue. We cashflow is what pays your bills that's a good thing. We tend to if you see anything from I would say four times EBITDA up to 10 times. Really what I would say makes the difference as to whether you're four times or 10 times is one is size.
As you get bigger you're going to go get a higher multiple and then the other part is is a lot of these qualitative factors if you are 100% on Amazon if you have a hodgepodge of products that don't really have a brand identity and you're growing at a mediocre rate you're probably and you have mediocre margins you're going to be at the lower end of that that realm.Now if you are growing extremely rapidly you've got a very attractive brand that has a defensible niche or defensible position within a attractive niche of the market. You're selling on either multiple channels or your channels are heavy D to D to C and less reliance on Amazon. You've got a lot of the other part of it's future growth do you have more product line extensions that are very natural product line extensions that are easy to do and in terms of should be very easily accepted by your existing customer base.
That's going to push our multiple up higher to those higher levels that we see.
Go ahead sir. How many deals do you look at that are same marketed at 10x EBITDA that are actually worth worth that do you think?
2%. I don't know. Wow. Not many. I we we don't tend to play at that upper end of the the multiple range. Part of what we're trying to do is find situations where we're going to bring some value add and typically that means that there's a few of those attributes that aren't fully baked at that point and they need some help to get there. That being said I have yet to run into a transaction where there wasn't some level of competition whether the competition was another buyer or whether there's just the competition is the seller not having to do anything because he or she's making a lot of money. You've got to pay a market multiple for for transactions but we do have time. It's from time to time run into people that have inflated expectations. We tend to just continue to build a relationship and see if something will morph over time. But but yeah unfortunately we have to be disciplined in what we do to make sure that we can stay in business as well.
Yeah absolutely. I think the appeal of of what you're doing in the private equity space I use that term pretty loosely is is seems very attractive to get capital. You'd go deploy the capital you get these huge returns and everything's happy days maybe sell the business down the line for a much higher multiple. Why do you do what you do?
I love to build small businesses. I mean that's really what in terms of waking up and being excited about doing something that's what gets me fired up. The people side of these businesses and putting the pieces together that are needed to help them get to the next level. I unfortunately am not creative enough to come up with these great products. I need other people to do that. Then I try to apply we're where some of our talents are to to help the overall situation grow. That's whatI really find fun.
That's awesome. That's a pretty cool cool thing to find fun. It's highly profitable too. You don't have to answer this but I'm curious as the partners of the business are you really compensated more on an exit? I've talked to some some groups that that's how they compensation really operates or are you paid along the way? How does if you can talk about that as far as partner compensation and how that works not specifically in your case but as a concept. How do you think about that?
Yeah I think I think it comes back to the alignment of interests and you need to have everybody in the boat rowing in the same direction. We put some of our own money into these transactions and we get the vast majority of the compensation that we're going to make is based on a successful exit. We all need to get the company heading the right way and growing and get it positioned where it's attractive to where it can be either acquired or it can be attracted where it's kicking off a lot of distributions and dividends the the interim period we get a small management fee that's paid to us but that's barely keeps the lights on to be honest with you it's really all about the upside that we're in it for. I think that's where the fun is and that's why we think we're we're really well aligned in terms of interests with everybody.
Well this has been a super interesting conversation and hopefully the listeners have found it as exciting and enjoyable as I have. I could talk to you all day but we are coming up to the end of our time here Brien how can people get in touch with you?
Ah yeah no thank you very much too. I've enjoyed the conversation. easiest way is probably email. It's Brien and I spell it funny firstname.lastname@example.org and then you can also find us on our website at altacrestcapital.com.
Awesome. Well yeah I highly recommend people go to your website and check that out and definitely reach out to if they've want to learn more or if they've got something of interest to to talk about. For sure. And maybe just to wrap up could you you've talked a little bit about the the criteria that you have for investing. Is there anything else that you'd to highlight here as as a as a potential opportunity if someone is either with their own company or they're talking to a friend what type of businesses are you guys looking for at Altacrest?
Yeah we love consumer product companies and really have a wide variety of sizes. We can do transactions that are quite a bit bigger than beyond $10 million. I mean that's our legacy of Prudential. We did a lot of transactions for companies bigger than that but yeah we love to learn and we love to look at companies. We love to talk to the entrepreneurs and operators. I would just recommend people to reach out to us and even if it's not a fit for us or you're in a different part of your company life cycle and you're not ready to do anything we love to just begin a conversation and if it's not a fit for us we tend to know a number of folks in the industry and we're happy to make introductions because that usually turns back around and helps you out in other ways down the line.
Yeah absolutely. I love it. Awesome. Well thanks again Brian for for coming on Truth About Exits. This has been a great conversation and I'd love to have you back on after you guys have done some more transactions and we can talk talk more about it and maybe a transaction we work on together even. That would be great. That would be great. We'd look forward to. Awesome. All right thanks mate. We'll talk again soon. Take care. Bye.