Investor Strategy Call – 31st August, 2021


Speaker1: [00:00:44] All right. Just getting set up. Yeah, I see almost is here. And yeah, so Alma’s welcome aboard. So, yeah, just raise your hand when you have a question to talk. And so, yeah, obviously feel free to come on board and ask any questions. As I saw you raise your hand there.

Speaker2: [00:01:13] Hello. Good evening. Can you hear me?

Speaker1: [00:01:17] Yep. Yes, I can.

Speaker2: [00:01:19] Oh, I was just kind of. I didn’t realize that we could actually speak, so I just kind of waved just to acknowledge my presence that I was listening. I understand the rules, though, and yes, because I’m currently on my phone. So I didn’t see the fact that I could unmute my now that I know it. Thank you. Thank you for welcoming me. It’s good to be on board.

Speaker1: [00:01:41] Yeah, no problem. And obviously, you know, obviously no pressure right away if there’s no question right away. But but just kind of to so everyone gets used to each other and everything. Just we have a matter who is our is currently our financial analyst who’s helping the members with, you know, the financial details and so on. And then. Excellent. Yeah. And it generally the Monday calls like it can go up to like we’ve seen it to go up to like six, seven, eight people. But sometimes there’s nobody as well. And the Wednesday calls are usually empty because I understand you’re in the you’re in the you’re in, you’re in Europe. European Area. So then it may be too late for you. Yeah, exactly.

Speaker2: [00:02:22] It’s already 11 o’clock at night. I had a long day, but I thought, You know what I have to be? I have to start making my appearances and getting to know the system, getting to know the people yourself included, of course, and you know, just the whole process in general. So it’s good to be a part of it. Thank you for the welcome.

Speaker1: [00:02:42] Yeah, no worries. No worries. And and yeah, just in the back because I know where you’re at. So then, yeah, for you in particular, like I understand that it looks like it’s it’s more of a direct kind of transaction with investors. And so, yeah, I have that in the back of my mind as well. And then we’re ready when you are so.

Speaker2: [00:03:03] Oh, that’s awesome. Hmm. So I’m taking I take these calls because I was actually just going to listen in today, you know, just maybe here are some other people’s questions about the data room, because I’m currently just going through the whole process of understanding how this program works, kind of refreshing my knowledge about pitch decks, collecting all the knowledge for the data room, et cetera, et cetera. So at the moment, I don’t really have any questions, particularly if something comes up. Of course, we’ll raise raise the query, raised the hand and et cetera. But at the moment, I’m I’m just kind of like a sponge just absorbing all of the information that I can possibly absorb. So, yeah, if you have anything that of value, right, that you’re willing to just fire at me, go, I’m I’m all ears. I’m all ears.

Speaker1: [00:03:57] Oh, got it. Yeah, no, I think we’re in. Yeah, I think we’re in a good spot, I think. Yeah, Mondays sometimes Mondays are crazy and sometimes they’re empty. So then there’s no no pressure. And then I think if you want to come a discussion and listen back, yeah. Mondays are usually a good time. We have Abigail and I. They usually come. They usually like almost every week they come in and just discuss more of the what they’re doing if they’re seventy five million dollar plus funds and all the details. And so those are good calls to listen to. Yeah. Other than that. Clem Yeah. Clem, who we introduced to via email, is actually closing off a project right now. And so I think by next week you will start to open up again. But he’s just closing literally one of our members. He’s working on literally the final steps there. And so all this attention is focused on that. And then afterwards, and it’s awesome. It is. It’s stressful. So then hopefully and then that thing finishes and then you come back to the other members.

Speaker2: [00:04:57] So, yeah, yeah, yeah. Well, that’s excellent. That’s excellent. Yeah, I’m really looking forward to this. And just kind of increasing my deal flow currently on my end. This is kind of what’s happening. So we’re just reaching out to more companies here in the United Kingdom at the moment and just trying to collect as much information as possible on them and the ones that we do decide to go forth with the entire due diligence process and whatnot. That’s when, of course, we’ll start filling out the data rooms. We have one particular one in mind and I’m looking forward, but it’s Bank Holiday here. So sure, if that’s the same in the in the states at the moment. So everything is quiet. So we’re just waiting on a reply. But it’s yeah, it’s a good it’s good to take a rest too. Not that I’ve had any rest today. It’s been a busy day. No rest for, uh, you know, just trying to be as high performance as possible.

Speaker1: [00:05:55] Yeah. Well, you are awake at 11:00, so show us commitment. Yeah, that’s well. That’s what people need to get these things across the line. So. Exactly. Yeah. And we don’t even have it all day here. But yeah, and then yeah, I think one thing too is. And yeah, when you’re when you’re working on that origination process. Have a chat with Clement whenever he comes back to you and then you can it can help you see, oh, you know, since it’s a he’s a direct funder. What are some of the what are the buy side mandates? It just saves a lot of time. Instead of assuming what the investors want is just like, Hey, you know, he’s the he’s one of the guys and there are several other guys. It’s like, OK, what do they want? Just matchmaking for them. So hopefully that will just be up some of the back and forth there.

Speaker2: [00:06:44] A shell, a shell, thank you.

Speaker1: [00:06:46] No worries. And it looks like it will be empty, so I’ll hang out for five or seven minutes here and then if anyone comes, if not, then and that’s it for today.

Speaker2: [00:06:56] Yeah, of course. Oh, well, then I guess if nobody else is in here, maybe, maybe I do have a question. Let’s see. Let me fire it. So just out of curiosity. So I had this one deal. The only thing is that recently, you know, we completed our due diligence on the company. And what happened was we had the entire data room know and these are the previous capital raised from the kind of burned and burned me, as you ultimately put it in that email. Basically, what happened is that they took their time and then in the same time, I was kind of going through my due diligence, but I collected all the information, et cetera, et cetera. But the only thing that came back was that the company, just because some supplier contracts were not really in place, not because they were necessary. Although from a buyer’s perspective, it would be nice to have contracts in place from buyers, from suppliers as well as the customer side. But in this particular industry, and I understand this because I was buying from a very experienced owner in the building chemicals industry and they don’t usually work on a contract basis. You know, it’s it’s. And for them, it was much more beneficial to not have contracts because they because as prices fluctuate, for instance, for raw materials and things like that, they can also adjust prices.

Speaker2: [00:08:21] So that way they’re not losing out on things and blah blah blah. But in some ways, it can also be a detriment because then naturally, the suppliers can also raise prices and things like that. But so he explained to me why he didn’t have contracts, and so we were at this point. But that kind of diminished the value of the company in the eyes of my accounting team, my entire due diligence team. After they’d done it, it was a high risk area. You know, revenues aren’t necessarily set in stone, even though they’re not. They’re technically never set in stone, but with contracts, they seem to be a bit more. There’s a bit more certainty. Yeah. So we came to this position where we felt like the company was worth slightly less by a few hundred thousand. Well, about a million less, basically nine hundred thousand less than was originally kind of asked for by the brokers and the owner and everything and the kind of agreement that we came to. So basically, my question is and because due diligence is always ongoing and, you know, sometimes you might dig something up that can affect the pricing of the of the company. Do you reckon that you could still potentially fund because we’re we were working on on a on a one hundred percent, one hundred percent funding like debt rate.

Speaker2: [00:09:44] So we were raising debt. And one hundred percent of that was funded. But when we discovered that these contracts and everything, kind of the lack of them actually inhibited the company’s valuation slightly. That could also inhibit obviously the capital rates and the amount of security that the that the investors would potentially well, they would like, the more security, the better, obviously. So naturally, the kind of diminishing and security. And I was just wondering, how often is it? I guess my question is, would it still be possible, for instance, in that case to raise one hundred percent of the funding? Or would it go? Would we go for something like a maybe a 50 percent of the funds would be raised instead? Like, because that was ultimately what the deal led to. I was saying that if you did want that same amount of money, there would be that would have to be a deferred arrangement. You know, we could raise X amount upfront and then the rest would be deferred over X amount of years because that would give us the security. And then that way you’d have like a buyout, kind of like a buyout clause. That way, everybody gets the security. But the owner, he was kind of very old school. So we’re still kind of in negotiations with him and we’ll see how that goes.

Speaker2: [00:11:06] Yeah, but in so from from everything that I understood, that would be very difficult to still raise 100 percent of the funding. For instance, in that case, it was two point sixty one five million. The valuation from my accounting team and the due diligence team came back about one point seventy four million, but naturally, the company is doing fairly, fairly well and a five times EBITDA kind of calculation that still came out. It came out at one point seventy four, but the company was growing consistently. So it’s just wondering from your experience and engaging, gauging, raising. Finance and things like this. It wouldn’t be very difficult to raise more than one hundred percent funding, for instance, in this case, if the if the company was 1.1 million, could we still over finance or if it was or if it was even just to the original deal? The deal amount, which was at two point sixty one five, is that difficult to do or is it fairly standard or would my original kind of deal structure that I came to in the end of, like, for instance, 50 50 up front and then 50 deferred? Would that be something that’s more kind of more standard if you get my meaning? Maybe I was talking too much, so we got lost in that.

Speaker1: [00:12:30] No, no. I got it. I got it. So then because this one, because the thing is that everyone comes from a different angle. I can only speak about the deals that I’ve seen because the matter obviously feel free to chime in at the end or whenever you think, of course. But then because. Who is the one doing the due diligence because some people that engage in investment banks, they do the due diligence because they have to please their auditors and all that. The securities auditor so I’m curious on because everyone is biased at the end of the day. So who’s really doing their due diligence on the. On the company. Yeah. And who’s word? So that’s the truth here.

Speaker2: [00:13:08] Yes. So I hired an external accounting firm, you know, chartered accountants here in the UK to do the due diligence on the company for me. So also in line with me. So obviously, I’m doing my own due diligence and then at the same time, they’re kind of doing their external kind of audit of the company and you know, its pitfalls, the financial model, basically everything just to do with the company so that I know that the structure of it, how it works, where all the sources of supplies are coming from, where all the customers are, who they are. How much is going out to them. So basically, it’s an external team that I have of chartered accountants and lawyers, I guess.

Speaker1: [00:13:49] Got it. So then in a prior engagement that you had in these folks that came in? So these folks came like this, this capital raised firm came in and it would probably say, Oh, let’s just redo all of the due diligence from scratch. So did that not happen when they were selling that to investors? Or am I wrong?

Speaker2: [00:14:05] Yeah, yeah. Yeah, yeah, yeah. Yeah, they were basically doing their own appraisals and things like that. Yeah.

Speaker1: [00:14:10] Got it. Interesting. So. And unless you’re just taking notes. Now, just a second step in of.

Speaker2: [00:14:23] Of course, yeah, please.

Speaker1: [00:14:31] Ok. So because, yeah, because so then they’re doing external due diligence. So then did they not? So what was the difference between theirs and yours? Did they say that that contract was? The contracts are really the value of the company is higher because I’m following almost his firm’s valuation? Or am I following this investment bank valuation? Which one was the one that was told?

Speaker2: [00:14:55] Uh, so no, I was following my valuations and the business owner had his own, the business brokers and everything valued his company their way. And they were like doing add backs and everything like that. Things that some things that we wouldn’t include in an EBITDA calculation, for instance, especially when you’re selling or buying, actually when you’re buying. Probably what I’m selling, I would include it like things like director salaries and things like that. But uh, and then the the capital raised firm, they were doing their own due diligence, but we never even completed on that because the thing is the deal started falling apart beforehand before that. So and that was going to be they were already sending people over and that was going to be extra charges for that and all of this stuff. So first, I was completing my own due diligence because naturally, I had to know all of the financial models of the of the well, basically the financial model of the company, how it’s running, what it’s doing, why it’s doing it and where all the money’s going, where it’s coming from, et cetera, et cetera. But am I right in saying that I should I can actually outsource this to the investors themselves?

Speaker1: [00:16:04] Yeah, well, I mean, what’s interesting before I even jump to that, I think let me just hit this one because before I even jump to that, because so then because you’re saying that too in terms of if you can get 50 percent versus 100 percent, I say that it depends on on, if on. On the lender’s criteria for the types of contract they can accept, because I guess one thing I would say, oh, why is it that they cannot just have a contract? That’s just anything. Anything that is legally binding, that’s that validates any assumption that says, Oh, we will buy in the range of this from this price to this price or as a price as low as this price to a price as high as this price, depending on the price on so and so dates. Because I don’t understand why people can’t quite a firm can just say, Oh, we’re going to make a contract for what is indicative of the market at a certain time. But I understand the nuances of the I don’t understand the nuances of that industry and why they can’t be, because

Speaker2: [00:17:03] That’s exactly what I was saying. That’s exactly why we lowered the valuation of the company because we were saying exactly the same thing. Why wouldn’t you have that? That would actually be of great benefit to one. You’d have some sort of security and you can always adjust things, you know? So yeah, that was a problem. Hence why the valuation of the company, from our perspective, was reduced.

Speaker3: [00:17:23] I’m sorry if I can add on that. So I think so that that would also depend on the like the future projections in terms of the contract. So if you’re saying the prices are going to decrease in the future, then yeah, for sure, the valuation should be lower. But if you think the prices might increase given the the macroeconomic environment or any other reason, if if the the seller has that, you know, opinion that this is going, the prices are going to increase, then it’s not necessarily a bad thing to have that. Like I’ve seen that in so many companies, they actually intentionally do that because they assume the prices are going to increase that. That happens a lot with the oil like derivatives, like people go for derivatives. But but there are instances where people don’t really go for it. So I think it actually depends on the industry you are in and also depends on what you are projecting. The future price and future revenue is going to be.

Speaker2: [00:18:26] Hmm, that’s an interesting point.

Speaker1: [00:18:29] Yeah. Got it. So then and with that, I think it also comes in things for that matter. I mean, Matter is a chartered financial analyst here. So I mean. I mean, he’s been in, he’s deeply studied that. So that’s one of my points, too is yeah, because the and I think it’s a case by case in the sense that, yeah, it’s whatever, whatever story is strong enough to convince that particular lender. On if the debt would be serviced, it’s usually the case and because like, we’re just really hypothesizing right and the best way to do exactly. You really need to test it in the market. And if that was just because,

Speaker2: [00:19:08] Oh yeah, sorry, please continue.

Speaker1: [00:19:10] No, that’s it. And then if if that was what you saw in the market, that’s the number one way to know, because right now is this hypothesis.

Speaker2: [00:19:16] So, yeah, exactly. Yeah, that does make sense, of course. And especially the fact is the numbers would add up the numbers stacked up to our original valuation. It’s just then from the entire due diligence process that came to basically just came up as a high risk area. The fact that technically because there were no contracts in place and after changing management and we have a board of directors change and et cetera, et cetera, that there could be some fluctuations in the amount of revenue that we’re receiving because technically we don’t have any customers or the contracts who are receiving these chemicals, nor will the suppliers who we and very heavily relied on. It’s a very high quality product, and so the suppliers are primarily there’s one supplier and then there’s a few other ones just kind of supporting that with various other products. But there’s a specific supplier that supplies very high quality product, these chemicals. And one of the highest, I’d say in the world, which is why they have such a good standing. Yes, but there are no contracts that would kind of push them to or lock them into even doing business with you after the management change, you know, so it was like these nuances, these new ones.

Speaker2: [00:20:26] But technically the revenue and the amount of the EBITDA and the amount of cash flow basically coming into the company would have supported the original debt service payment. It would have actually supported a an over financing because we were originally actually going for five million US dollars over the course of plus five years, though, you know, so that was kind of the initial idea was to over finance and then expand. So I was just wondering if this was this was just kind of I was getting told tall tales or if this was still a possibility, you know, in the future for other kind of businesses, if I could still use that kind of model to over finance, to use to acquire the company, have enough to service the debt and obviously to expand the company by through acquisition of further companies or just operations within. If you saw that as a potential, you know, as a solid theory, basically solid hypothesis of how to expand.

Speaker1: [00:21:25] Yeah, well, this one is more than this is actually this is actually what it was. You may want exactly that stuff. Yeah, you give you a lot of insight into what’s happening, but that’s basically what’s happening with him because I mean, he’s getting a line of because I mean, his company does one to two million. This is it’s government contracting space acquisition. He’s going to do 50 million yearly. So it’s a big jump. Mainly, you know, he’s getting acquisition financing and he’s also getting some money to set up the facility and so on. And so he’s getting both just because of the because the government contracting space, those types of contracts are very brings people a lot of confidence, especially in America working with those types of federal election agencies. So that’s why people to get some of those term sheets and so on. So I’d really I’d really say, yes, it’s possible, but I mean, I mean, this is a company that is doing 50 million yearly.

Speaker2: [00:22:28] Exactly. And it’s got the contracts, government contracts that really, really give you a solid footing. Did you say the the gentleman’s name is Steph?

Speaker1: [00:22:36] No, Steph, you may. I mean, he may be pretty busy right now, but yeah, feel free to just have a chat with him to see just pick his brain.

Speaker2: [00:22:45] But just just at some point, just so I can. I remember if I do come across them, I can say, Hey, yeah, they’ll be great. Exactly. Yeah, I greatly appreciate it. Yeah, man.

Speaker1: [00:22:57] Yeah, I mean, he’s the one. He’s doing it. So I mean, it’s good to see from the other side, right? And matters, yeah, and matter any any other insights, because, yeah, I mean, I think it’s just honestly, I think it’s, as you said, like macroeconomic case by case based on the lender’s criterion for how they upset the assumptions on the financial projections and anything else you can add matter

Speaker3: [00:23:24] If you can. So another point to I think that that could help here is so if you are looking from a from the perspective of a lender like and not really an equity raise from a lender’s perspective, I think like having those contracts with suppliers as well as buyers would help your case like. Yeah, but but from an equity perspective, I think it would be more like it would depend like as I said before. But but just talking about from a lender’s perspective, I think that would be a better case.

Speaker2: [00:24:00] Hmm. Yeah, well, that’s a that’s exactly I’m glad that I got some good confirmations here with the fact that that technically my way of thinking was correct. I mean, you can have many ways of thinking, but it was definitely a good decision because ultimately I would have been putting myself into a position. It would just be high risk. It would be quite high risk. And it would be very difficult to raise all of the funds, I think, without having the contracts in place because the security wouldn’t be there and especially paying off a debt that would take seven seven years, maybe plus even just for that small company. Because considering actually we’re growing through acquisitions, so there will be more companies attached to it. So it would be much easier to pay off within the next couple of years. But if you would just focusing on that one and from that starting point, then it could be it could just prove difficult to raise that amount and then you just be wasting time. Hence, why we went with the deferred arrangement. But the gentleman is very adamant to get one hundred percent upfront and we just want a bit of security. So that’s I guess this is what negotiations about. So we’ll see.

Speaker1: [00:25:09] Yeah. You know, totally, and what we see is the is the next step for you here because so so this is something that you know, you’re just going to get that first one underway and then then you’re going to commence a large acquisition afterwards or because it looks like you’re really I mean, you’re really deep in it now or you just want to take a step back and just work on another type of project.

Speaker2: [00:25:30] Yeah. Doing two things at the same time. So we are taking a step back. We’re looking for we’re looking to increase our deal flow significantly because what happened was we got very involved with this project. And then what happened is for about two months, we were kind of just building the pitch deck and et cetera, et cetera, collecting data room, doing all our due diligence because, excuse me, just been talking all day as well. And so now it’s already 11 pm, just getting dry throat. So yes, spending two months, especially getting acquainted with the analysts here, the my the chartered accountants that had hired here. So we were kind of understanding each other’s rhythm. So the amount of due diligence that I required, we were going through all of that. So it took them a little while to get into my rhythm and then get all of the information that we kind of required in order to to get the capital raised under way. And but then what happened is naturally, because after the due diligence process was complete, we found out some other things some kind of yellow flags that could potentially decrease the value of the company, from our perspective, not necessarily decreases in revenues, et cetera, et cetera. But then what happened is that we spent so much time on that company that we didn’t really have any other deals flowing.

Speaker2: [00:26:48] We had a few, but then we we kind of dismissed those because they weren’t. We just felt they were. They were not lucrative enough. They weren’t worth the worth, the attention. But now we’ve kind of started up again. So where we’re looking for a bigger deal slope because naturally, we’re going to be growing for acquisitions. So after the first company, we want to increase the amount of companies we’re buying every single year. So we’ll go from one to maybe two or three in the year to five in the year and ideally just increase exponentially. But we’ve got to start with one. So this is the first one. There is another one that we’re looking at to do with like freight and various distribution networks for also for chemicals and various other things. So but it looks very promising. So but once we have more information than naturally, I’ll start filling in all of the data room and bringing more questions to the table. But at the moment, we’re just looking for more deals, more deals that’s looking for that. The cream of the crop, let’s say, here in the UK, it might be a tiny island, but you know there should be enough. Yeah.

Speaker1: [00:28:00] I mean, there should be and yeah, and pacify us like matter and I. Richard Richard Reid Yeah, we can take a look as well and give you our thoughts as well. And then. And I think in regards to your other question about investors and due diligence because they forgot to answer that. I mean, any of these capris firms, because because they seem to be registered with the Securities Commission, they kind of take advantage of that in the sense of saying, Oh, we’re going to redo due diligence, right, because they do get audited and they do have to take on quote unquote legit projects that they show that they’re not selling people crap that’s going to get them deregistered. So there is a thing there. But so sometimes they will fly it out like you can ask them, like he did fly down and they did fly down and with the other firm and so on, and he looked at everything. So there is that. But at the same time, if it’s a sophisticated investor acquiring 10 million or something like that, then they already have their own. You’re already going to do due diligence anyway. And it’s it’s it’s less likely that they’ll use that as a means to consult unless they’re like an intermediary, like an investment bank. So basically, what I’m saying is that they probably would cover their own due diligence if they’re the ones who are. But if there are consultants who may have the money, then they’ll they’ll say, Oh, you know, we have these due diligence things that we have to do so.

Speaker2: [00:29:18] Mm hmm. Mm hmm. Of course. But naturally, a building out the data room that that in itself is a big chunk of due diligence kind of done. You know, if you’re asking for various, you know, lease obligation, just all of the information that goes into a data room, that’s that’s a big portion of that already done in the first place, though, because the pitch deck you’ve already done enough. I mean, it’s kind of surface level, but even then it does go quite deep. So I think it’s like a balance, right? Yeah, you still got to do your own due diligence because there’s no way around that because ultimately you have to know if what you’re selling and what you’re buying is worth worth buying.

Speaker1: [00:29:59] Yeah, because we forget, like I forget to that that, oh, you know, we’re on the internet and so on. But really like, these are physical products here, and sometimes we forget this too. So. Mm hmm. You know, there’s a lot of money at play here. So people, yeah, they do get people to validate all the assumptions and look at every single source of revenue in any financial statement and try to see where is it? So.

Speaker2: [00:30:25] All right. Yeah, and I mean, I don’t have anything else to add, I’m just going for the video is currently. So I think I’m I’m on the second section just just going through them basically about the data room. Currently, at the moment, I haven’t got into the bit where I’m actually using the tools yet, but but it’s coming and it’s a very substantial, you know, it’s very substantial, substantive. There’s there’s quite a lot of information, quite a lot of, you know, points to cover. And I was just wondering because I recently came over this worksheet where you had, you know, where you could present multiple deals. Your deal flow basically to investors and say, Hey, I’m working on this, this, this, this and that. So I had one question in terms of because sometimes we do have five or six deals right at one time and we’re looking at them and they all look great. And potentially they’d all be companies that we would like to acquire it, consolidate in that specific niche. And so building out a data room for each one of those, that might be a very lengthy process, you know, so I was wondering, what would your what would your, I guess, tactic or sorry, I forgot the word that I’m trying to use here.

Speaker2: [00:31:48] But the the your approach to financing these deals would go because if you have say, for instance, five companies in a specific sector, they basically go hand in hand with whichever they’re exactly the same thing. You know, maybe they’re just jam sellers. So you have different types of jam sellers and you have five of them one’s orange ones, Apple, you know, whatever. And so you approach the investor, and it might take quite a substantial amount of time to fill out this data room. Would there be a point in that? Or would you just say, Hey, look this, these are the companies, these are their revenue streams, et cetera, et cetera. This is the EBITDA. This is, you know, their properties where they’re trading from, and this is our vision for them. Could you potentially unite them into kind of one pitch deck? Is that is that has that been seen before? Is that something that might be, you know, cost effective, time effective? Yeah. Or would you just go through them one by one?

Speaker1: [00:32:48] Yeah, good question. Like, I’m always like a lot of things that we talk about, like, really, it’s on a bias towards being like pragmatist as much as possible. We’re really biased that way. So like I’d say, it depends on depends on the few things. It depends on the goal here and how the whether it’s a conglomerate or which because it’s like because the goal really is to get the call, get on the call is to close the transaction, right? That’s the way the goal is, of course. And so then it’s like the way that, you know, sometimes like for Ali and so on, the way that they’re doing it, they’re going to Cambridge Wilkinson. And you should probably talk to Cambridge Wilkinson, too if you haven’t, but they’re going to Cambridge Wilkinson and saying, Oh, we have this aviation deal and they’re going to try it out. And then after that, then it’s like, Oh, we have this and this hotel deal, we’ll try it out. And so they’re doing that. So that because if they wrap everything up underneath the same person and then the person doesn’t have that great reputation of that particular deal and it’s like one company, then then they may say, Oh, you know this, all this person is just a waste of time. And then they also say all of the projects, and then you wouldn’t be able to get to the next level. And so, you know, it depends on what really, whether it’s something that, you know what, I’m going out to the market. I like to just say, Oh, here’s this project, and then it’s not really there’s no big story around it so that they can just say yes to they can just say yes to one thing. And then when they say yes to one, then I just bring like a bunch of things or just pick one project, say, Oh, you know, what’s the criteria for this? And then just bring it and then afterwards bring the other things? The reason why is I just need to get on a couple of these, these investors, and that’s really what I want.

Speaker2: [00:34:23] So, yeah, yeah. Would you? Sorry to interrupt. Just just to fit this in quickly, would you? Because then it would be a significant, you know, a lot of time spent if you were to fill out an entire pitch, deck and data room for a project that might just get shut down straight away. Yeah. So would you maybe approach it in a way that you like? Create a teaser so you put those all out to X amount of investors? See the feedback, see if you get on the call and if there is, you know, bites to your line, then then you’d go deep and then you’d be able to supply them within like a week or two with the actual substantial amount of information that they would probably need for the investment. Would you approach it in that way, or would you prepare everything in advance and then say, OK, so now I have this whole package, here you go. Here’s all the information, et cetera, et cetera.

Speaker1: [00:35:19] I would do the former if it doesn’t take like a lot of time because. I mean, again, like I don’t know if you heard the quote, but time kills deals, right? And so as long as exactly, yeah, as long as it can be done in a reasonable amount of time, then I think that’s a good approach because it’s best to sell it before it’s together because it shows it saves your time. It’s kind of like selling the product before it’s built. So I’d save the time instead of you having to validate or whatever. Mm hmm. So, yeah, I think like as long as maybe doing it on a Friday or Thursday and then coming back on Tuesday or Monday so that there’s weekends, just get everything together, then I think that’s a reasonable approach. And then maybe to, you know, you get because usually the process and this is what came into us and all these guys do, usually they do. They said, Oh, here’s the. And what is it? Yeah, no, here’s the call, and then after that, you’re the NDA, and sometimes these investors are waste time and that simple NDA. So that’s another way to just delay for time. And then after they do that, then you can say, Oh yeah, we’re we’re getting it together. And then. And then in between, you can just sign a simple NDA to some of them say waste time, or maybe they send you theirs.

Speaker1: [00:36:28] And so that’s kind of a nice excuse as well. And then, you know, so it can take yeah, I think that would be a good idea. What else here? Or you can have different levels of data or due diligence, so to speak, like you can have one where it’s more just broad information. It doesn’t have the most viable information in the companies like that doesn’t have the you can have a quote unquote NDA free data room that maybe doesn’t have members over everyone in the place everyone lives and everything that’s super confidential, depending on on the risk. Like some companies, they don’t do that. Some companies, they don’t care. So it depends on that. Maybe looks like a light data room or even after the NDA, there’s like a light data room after the NDA. And then if the person asks for certain things, then you can just add things as they need. The point is really to have the structure to show that you’re serious and show that they’re serious and whatever, and then you can be really key. And then it’s like, Oh, you know, we have a flexible data room. We do it based on what the investor wants, and then they’ll ask for things and then they get it. So those are just a few ideas because really, you want to frontload the testing instead of just wasting your time building the data room and not going in. Exactly.

Speaker2: [00:37:41] Yeah. Yeah, yeah. Because that’s that’s the bigger. Yeah, like you said, time kills deals. And this is exactly what I’m experiencing with this first deal is that we got so far into it. And now, because of the fact that some variables changed and we we’re in a position now where it’s either going to go through, but on different terms. But that will only happen if the seller decides to. And then even even in that regard, we still have to spend X amount of time raising raising capital for that because now it will definitely be for raises, you know, because this is the this is the bee’s knees that they say of raising platforms. I, you know, doing it yourself and but also having the structure there, it’s very important and the context, naturally, you have to have the context because it saves so much time. It’s just incredible. So I just really want to get through every single piece of information, absorb it and then I get right to it. And in the meantime, just get the deal flow deal flow in so that I can get as many teasers and as many light data rooms as possible within reason, obviously, because ultimately we’re focusing on on getting the transactions over the line, closing them. Yeah. Awesome. Yeah. Ok, yeah, that is awesome. Thank you. I really appreciate you taking the time.

Speaker1: [00:39:05] Don’t worry. Hopefully, you got some big ones, too. And so, yeah.

Speaker2: [00:39:10] So that’s the funny thing. I so I made a friend recently with a director in Goldman Sachs, but here in Europe, I had this one one deal, this deal, and he was like, This is a bit small. I love the idea, but just come back to me once you have 10 companies underneath, like in this, I’m consolidated in this conglomerate and then then we’ll invest and it’s like, OK, great, we’ve got to look for bigger deals.

Speaker1: [00:39:36] Yeah, these are faster and faster.

Speaker2: [00:39:39] Yeah, that’s yeah, exactly. Exactly. So that’s it. Basically, that’s what we’re looking for. Nice. Yeah. Yeah, sky’s the limit.

Speaker1: [00:39:47] Let’s do it. Let’s get it done.

Speaker2: [00:39:49] Yeah. Excellent. Well, thank you very much. I think if there’s nothing else, we can all go get some rest. Well, at least I will. Yeah, yeah. And you take good care. You take good care.

Speaker1: [00:40:02] Yeah, both of you. You are Thomas. Talk to admin easy.

Speaker2: [00:40:05] Definitely take care. Thank you. Thank you. Chairs, yes.


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