Natu Myers sits down in studio with Steeven Severe, a Canadian business owner and acquirer who buys through Blackcore Holdings. He found his first acquisition while buying a couch, closed it in 118 days, and now runs it on two hours a day. This is his buy box, his lender, and the seller structure that gets deals done.
Host
Founder of Raises.com®, the capital-raising platform for people buying a business or real estate. Has helped independent sponsors, acquisition entrepreneurs and syndicators raise the capital for their acquisitions since 2019.
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Guest
Owner, Blackcore Holdings
Canadian business owner and acquirer. In January 2025 he and his business partner bought an 80-year-old food-service business operating under a government contract in Tunney's Pasture. He buys B2B companies with $5 million to $10 million in revenue to hold, and coaches young entrepreneurs as a volunteer with Business in the Streets.
blackcoreholding.comSteeven Severe came to acquisitions the long way: a student window-cleaning franchise that paid $25,000 in one summer, a year selling life insurance, construction labour, and a renovation company whose best year did $600,000 in revenue and still finished $50,000 in the red. When construction slowed in 2023 and 2024, he started looking for a business to buy.
The one he bought came from a conversation while picking up a couch. The seller asked whether he had ever looked at the food business, and the operation turned out to be an 80-year-old, third-generation food-service company inside Tunney's Pasture, running two Starbucks locations licensed through Nestle and cafeterias that feed government workers. He bought it with 15% down, equity from family and friends and the rest from the BDC, and closed in 118 days. It does well over seven figures a year at 10 to 15% margins and runs on about two hours a day of his time.
The rest of the episode is his playbook for the next one. A buy box of $5M to $10M in revenue and $1M to $3M of EBITDA in B2B businesses, too small for family offices. Going direct to owners, because brokers paid 10% at close talk sellers out of vendor financing. A 30% VTB that still puts $700,000 in a seller's pocket on a $1 million deal. The BDC's $1 million audit threshold and its 100% property lending over 25 years. And the Manitoba windows and doors manufacturer he is working on now: founded in 1960, about $10 million in revenue, no customer above 12.5%.
Steeven Severe's first acquisition was not found on a listing site. He was buying a couch, the seller asked whether he had ever looked at the food business, and the operation he walked into was an 80-year-old, third-generation food-service company running inside Tunney's Pasture under a government contract. He bought it with 15% down, equity from family and friends and the rest from the BDC, and closed in 118 days. The business now runs on about two hours a day of his time.
His criteria since then are narrow on purpose: $5 million to $10 million in revenue, $1 million to $3 million of EBITDA, B2B service, distribution, wholesale or manufacturing, operators already in place, and an owner who is not the business. That band sits below where family offices hunt. The Manitoba windows and doors manufacturer he is working on fits it exactly: founded in 1960, about $10 million in revenue, $1.8 million to $2 million of EBITDA, no customer above 12.5%, and property worth half the price.
The rest of the episode is how he gets deals done without overpaying the middle. Go direct to owners, because brokers paid 10% at close talk sellers out of vendor financing. Offer a VTB the seller can say yes to: 30% carried on a $1 million business still puts $700,000 in their pocket today. Pick investors who want steady cash flow over a quick flip. And never be beholden to one master, a lesson a second location taught him this year, when a slipping return-to-office date turned it into a loss of well over six figures. Late in the conversation he names the misconception he most wants buyers to drop: owning a business does not make you a millionaire, because a company doing $10 million that owes $10 million is still in the red.
A broker paid about 10% at close wants all cash now, so the VTB is the first thing cut. Talking to the owner directly lets you lay out the plan and send it to their accountant. Steeven's own seller refused a broker for the same reason: 10% for a job that amounted to an online listing.
Ten deals of $100,000 each, each paying $15,000 a year, is $150,000 a year collected from quarterly reports, with no materials, permits or contractors. Steeven looks for investors who want that, and passes on those who can only see the six-month flip.
Paying a broker to kill your structure. Steeven says brokers take about 10% at close and steer owners away from seller financing; the seller of his own business refused a broker and sold directly.
Locking up 10% at LOI. Brokers often ask for 10% of the price in escrow when an LOI is signed. His objection: an LOI is not a commitment, so why commit 10% down on one?
Buying a business where the owner is the business. Even at a hundred million dollars, if the owner leaves and the business goes with them, he walks.
Taking investors who want a flip. An angel who wanted more equity on a $750,000 deal compared it with flipping a house; Steeven now looks for partners who value steady cash flow over a quick return.
Cutting people because an AI model said so. The supplier with a 10-year relationship and the warehouse worker who knows where everything is carry value a spreadsheet does not see.
Steeven Severe is a Canadian business owner and acquirer who buys through his holding company, Blackcore Holdings. In January 2025 he and his business partner bought a food-service business operating under a government contract in Tunney's Pasture: two Starbucks locations licensed through Nestle plus cafeterias that feed government workers. Before that he built a renovation company specializing in basement rentals and home extensions. He also coaches young entrepreneurs as a volunteer with Business in the Streets.
His buy box is $5 million to $10 million in revenue with $1 million to $3 million of EBITDA, in B2B service, distribution, wholesale and manufacturing. He calls it a sweet spot because family offices look for $5 million to $10 million of EBITDA, which means deals of roughly $25 million and up, so companies his size are too small for them. He also wants 15 to 20% EBITDA margins and operators already in place, and he will not buy a business where the owner is the business. His stated goal is to close three $5 million to $10 million deals a year, five if he pushes aggressively, and for a first acquisition his advice is any business 30-plus years old with good management.
He bootstrapped it. The equity came from family and friends, he put 15% down, and the BDC financed the rest. From the day he met the seller in September to signing on January 6, 2025 took 118 days. He says the big banks treated him like a kid, and the BDC account manager believed in the deal and walked him through the process.
As Steeven describes it, the BDC gives a borrower roughly $1 million of runway before it requires audited financials: buy a $300,000 business and a $700,000 business and neither needs an audit, but once the total crosses $1 million the next target does. When a business comes with property, he says the BDC will lend 100% of the property's value over 25 years as a separate loan. In his experience it focused on good credit and where the money was coming from rather than on net worth. The tradeoff is speed: for good on-market deals, which he says do not stay on the market long, he calls the BDC not fast enough, while private lenders move faster at interest rates of around 12%.
He says brokers take about 10% of the deal at close, so they steer owners away from a vendor take-back (VTB) or partial seller financing because it delays their payout, and they often ask for 10% of the purchase price locked in escrow when an LOI is signed. The seller of his own business approached a broker, balked at paying 10% for what amounted to an online listing, and sold directly. His rule: the further you go from brokers and the closer to the owner, the more room there is to structure a deal properly.
Steeven's worked example: on a $1 million business, 30% as a VTB means the seller walks away with $700,000 today, earns interest on the balance, and receives a balloon payment in seven years. He adds that owners who believe in their business should be comfortable carrying part of the price, and that a VTB can be better for their taxes and gives them steady cash flow for years after the sale.
A second location, which on its own had been doing seven figures, was opened on information that turned out to be wrong: the government workers it serves have not come back to the building, and the return-to-office date moved from July to November. It was kept open for a year and the business lost well over six figures; the location is closing and will reopen once the building fills. His takeaway is his motto: never be beholden to one master, which is why he is diversifying beyond a contract that renews on a five plus five year term.
As a tool, not a replacement. He uses Claude to compare food costs against three months earlier and find where spending can come down, and says AI can shrink an accounting function from five people to two. He warns against cutting people on an AI model's say-so: the supplier giving you below-market pricing because of a 10-year relationship, or the warehouse worker who knows where everything is, carry value a spreadsheet does not see.
The structure, documents and introductions behind an acquisition like the ones Steeven describes.
The funding sources ranked, including government-backed lenders and seller financing.
Tre Brown on sponsor net worth, DSCR and the capital stack, with the numbers.
The Raises.com Top Capital Raiser Show archive.
Hello, everybody. I'm super excited. So I recently met Steeven and Steeven is a business owner. He owns multiple businesses and was in multiple businesses and he's an expert in mergers and acquisitions and he's looking for businesses to buy. He has mentees. One of his mentees is actually in the studio right now. So super excited. We're going to get right into it. Steeven, nice to meet you.
Nice to meet you as well.
Awesome. Awesome. Well. So let's begin from the top.
Yeah. Let's get it. Yeah. Let's start from the beginning. Yeah. I moved to Ottawa full time back in 2016. And before then, I actually started a couple of companies in university, but it went nowhere. We tried to start a couple of online businesses. I met some programmers, networked. Didn't know much about equity, but hey, I'll give you half of this if you can build this. Stuff like this. uh didn't go anywhere but the idea was still there uh moved here in 2016 and actually my first business I owned was a student franchise so it was like a window cleaning franchise okay you mean
Like uh student works painting and all those guys yeah so like a college pro or one of those guys
Okay got it this one's called like Shine Student Services yeah so we did like windows gutters um and like a driveway sealing and I mean at the time I thought it was really good money I made like 25k in one summer so like in three months I made like 25 000 doing production but the hours I was working was like absurd like so I'll do production during the day from like seven to five and then from like five to like eight I'll go door knocking yeah to get more leads yeah and I did that for like four months straight yeah so I was kind of burnt out of it I felt like I learned and like um in a way my parents didn't really support what I was doing they wanted me to get like a government job or like how come I can't find you know how it goes bro yeah yeah yeah so like it was a lot of stress on that end so I didn't have a lot of support to like go back and do another year yeah I should have, but I didn't have the support to do that. So I decided to leave and then I got into life insurance. So I started selling insurance. I became a licensed insurance agent. So I worked for Combine. I was only an agent for a year. I hated it. I thought, like, I know someone in my, when I played ball at St. Mary's University who worked for the same company and they did really well for themselves in university. So I'm like, you know, once I get out, maybe I can do something like this. But I absolutely, I hated it. I felt like I was lying to customers. a lot of the policies that we had was kind of like uh was that more of an add-on to what ohip offered so yeah I kind of felt like yeah I didn't believe in the product I was selling and if I didn't believe in the product I was selling like why am I selling it right yeah so after a year I left and like it was just like a just weird gap of like I quit my job in february and if you know anything in like canada you quit your job in the winter you know you're not finding another job till spring right so oh I didn't know that yeah yeah if you put your job in the winter you're not finding like it's very hard to find another job because they do like a hiring freeze kind of thing in the winter because like you don't need to really especially depending on the industry you don't have to hire much in the winter because it's kind of like it's kind of everyone's slow
Season yeah so I get where you're at because like you need labor when during the hot season exactly
When things like warm up like in may but like you don't really need like entry-level positions or labor until the summer and that's when all the students get hired to begin with right yeah and at that time I was only 23 24 so okay still very young and still a lot of entry-level positions So I left and I started After I left insurance I did Uber, Eat, Skip the Dish Like whatever it took to pay my bills And then I fell into construction So I found a labor job in construction Actually, believe it or not I worked for her cousin
Oh yeah, eh?
Oh yeah, he was a slave driver
On God Yeah, well I mean the audience doesn't know Who you're referring to
Yeah, so I'm not going to put no names out there She's telling me I can't say it But it's my truth Okay, when girls go on camera When they're talking their truth, I can talk my truth. No, I give him respect because it wasn't like he was just working. Like, we were working. He was drinking water. He was working next to us. So it wasn't like he was just there, like, sipping iced tea. He was like, yeah, look at them work. Yeah, yeah. But, like, the hours were, like, some days were easy, but most days were ridiculous. So production had to be done. It was interlock and re-sodding. So re-sodding is basically when, you know, you remove someone's grass, you put fresh grass on the lawn. So we did a lot of that. And I learned a lot about construction through just asking him random questions and the industry. And then I left. So at the end of the summer, I left. I actually quit a bit before the summer, but that's a long story we will not get into right now. But I left and I started doing construction. I started working on high-rises and I saw the potential to actually go on my own because I come from a sales background. So the potential to go on my own to like, okay, this guy have really poor sales skills and he's doing multimillion dollar contracts. Imagine someone like me who has good communication skills, what type of money I can be making, right? Yeah. That was the thought process through all of this, right? So on and off, like I'll go into it, like I might get one or two small jobs and I have to find work because I don't have enough cash flow. So I did that for like a year. And then where I drew, like where I like decided I couldn't work for anybody anymore, I got fired Christmas Eve.
Oh, yeah? Jeez.
Yeah, bro.
From what, the construction?
No. So construction was done at that time.
Okay.
So I found just a winter job until construction started up again. And then I got fired Christmas Eve. Yeah. So that for me was like the calling, I call it. Yeah. The moment I realized I can't keep doing this. Yeah. I'm all in or I'm all out. Yeah. So I gave myself like basically the winter to find work or to find jobs to production for the summer. And COVID happened, which was the best thing that happened to me. It was the best thing that happened. It was the best and worst thing that happened to me. So when COVID happened, as you know, you can throw a quarter and you're getting work. Like I was spending like $20 on running ads. This was before everybody started running ads online. This was like 2020, 2019. I'll spend like 20 bucks and I'll get like, make a hundred grand. Like it was insane. It didn't make sense.
That's crazy.
So I did that and there was a lot of growing curves. I made a lot of money. Pardon?
What are your ads going to? What business?
So trade. So like my ads are running towards homeowners. So just looking for and it weren even great at good ads It was just like I just take the photos of the work that I did and then I would take that and then I just run ads on it wasn even properly structured it was none of that this was before ChatGPT so you had to like really like write out everything and then like post it but like my posts are way too long there was too many photos but somehow it was grabbing attention to people it was done very poorly but somehow I was still getting business out of it um these were local ads these are all local ran ads yeah locally ran ads So I started doing re-sodding because that's what I learned, interlock, and then I moved to interior work. So bathrooms, kitchens, and I really specialized. I really found my niche in full basement rentals and home extensions. So I really got into that and learning the city. Everything was a big learning curve. So my best year was my worst year. My best year, we did 600K, but we lost 650. Jeez. You get what I mean? like so I did sorry we did 600 but I was 50k in in the red yeah at the end of the year right yeah so um but I and I started to realize that's when I started watching a lot of like youtube about um businesses and stuff like that and I fell on to um EYL yeah I think I I looked up your story on
Your ig and I was looking at so these are these french uh how to buy a business card in french I
Can't remember no so EYL's earn earn your leisure yeah so I started really black guys yeah they're black guys from like uh atlanta I think they're from yeah but um I really started watching them because again there's not a lot of people like me like that look at me and you that yeah are doing like that they're they're rapping or balling you know like that's why I reached out because I could see that you're smart so I was like I have to talk to this guy yeah there's not a lot of people that's doing what we're doing yeah so um and what they will do they'll bring it at the time but now they're way too big they're doing like stadiums stuff like that yeah but when they first started off back in like 2019 2018 yeah um they were bringing on local entrepreneurs in different parts of America. So there's this one black guy that owned a piece of a bank. There was another guy who owned a staffing agency, and he was able to buy a private jet from that. Like things that we didn't know, there was so much black excellence out there that really encouraged me to keep going, right? And then I fell onto, from there, I started watching Codie Sanchez. And she really focused on boring businesses. And I didn't know what a boring business was. I thought, you know, business is business, but there's different niches in business and different ways to acquire businesses without cash and capital. So I just kind of kept that in the back of my mind. I was building my construction company. And then, let's say 2023, 2024 is when my mind really started to shift, moving towards acquisitions. Because construction started slowing down, which means homeowners. I was in residential. I was in commercial. So homeowners, people stopped buying houses. The economy started to slow down. Interest rates were going up. So when those things happen, construction, it doesn't die, but it becomes a lot more competitive. And it really starts to slow down. So I saw that trend and that curve coming. and I basically took full advantage of like, okay, this is the best time to start looking for a business. I wanted to leave Canada. I was actually looking to get out of Canada. Yeah.
Well, I mean, you're from Miami, right?
Yeah, I grew up in Florida, yeah. Yeah. So I lived in Miami and Central Florida, like Port St. Lucie. Yeah.
Tell us about that because you came to Canada. So how did that happen?
So my parents moved to Canada in 08. Yeah. I have family who migrated from Haiti to here. They live in Orleans, as you know. It's very French.
Yeah, I know Orleans.
Yeah, it's pretty French. So it was an easy transition for them. Yeah. So my parents decided to make the move. So we made the move in 2008. We lived here for two years. And then we decided to move back. So I moved back for grade 12. I played ball down there. Got no offers, but I got a couple offers up here. I go to St. Mary's. And that's in Halifax for those who don't know. Yeah. If you're from Canada, you know where St. Mary's is. Yeah. So I chose that to go to school there. Small town. I didn't want to come back to Ottawa, to be honest with you. but it was a small town away from Ottawa and I liked the vibe, East Coast vibe, so I chose that. But the move for me was a big culture shock.
You must have been like a giant, like what, like Goliath there, like in Halifax? No, man. Weren't you like the tallest guy there?
We had D-line when I was like 6'6", like 360, 3'8". Yeah? Yeah. Oh, yeah. I was one of the big guys, but I wasn't the biggest.
That's crazy.
Yeah, we had some pretty big boys out there. That's crazy. Because a lot of the guys we got came from CEGEP. Oh, yeah. The CEGEP, the French, they don't mess around with football. Yeah. All the guys became they came polish like 80 and I want to score an era right before they put the age restriction So I went to school a bit more tough
Yeah, yeah, so something funny is like cuz like you you also played Sooners and and I played Sooners back in 20 like when I was a kid I was under age like I don't know if you know this Eli I'm cool. Yeah, I play with ankle. Thank you. Like so good iron. Yeah Yeah, yeah. Yeah, Vic was wonderful. Me, Anku, Terrence Johnson, yeah, Vic, we were one of the first to do Gridiron, yeah. Yeah, the success story class or whatever. Yeah, because I played with Sooners with Eli in that first year when we were both 16. Yeah. And then I branched out into the Canadian side. I didn't understand the American, because we didn't do the whole prep school thing to go to the States. Yeah, this is all new. Yeah, this is all new. Yeah, yeah, because he charted that path. Like me, we're just trying to be like, oh, hey, we're not going to Carleton. We're going to somewhere else. But that was all we were thinking about. We weren't thinking about trying to go Div 1 or whatever. I was just trying to get a degree and move on. But that's cool.
I mean, the opportunities in states are a lot more better for Canadians now. Yeah. And I will give Vic his flowers for that. Yeah, Vic did well. He definitely pioneered that. And Eli himself was a big push. When Eli got the scholarship to play at UCLA, and then he stayed and then went pro, that really pushed Gridiron. and show that other people can do it. And now, what's his name? Mazador? The kid who plays for the Chargers? I aged out on him. Yeah, Akeem Mazador. He's from Gridiron, too. He went to the University of Miami. He came up through the Gridiron program, went to Virginia Tech, transferred to the University of Miami, and then he got drafted first round by the Chargers. First round? Yeah, by the Chargers, yeah. Wow. So Vic has really pushed a lot of people. But I just showed you the numbers, right? Gridiron had had, like, probably through from like oh wait to now probably thousands of students yeah probably five yeah to like that NFL that just shows you the numbers and I started watching that University doesn be more than five only five like Eli was Miles and Dar made it And two other people went undrafted And is playing in a league right now So only three or four. And some CFL guys as well. But what I'm saying is, if you look at the numbers, if there's 100,000 students in high school, only 10% of that's going to go to college. And only 10% of that's going to go pro. And only 10% of that's going to stick longer than five years. So regardless if you do make it pro or not, we're both in our 30s. I'm not trying to expose people to age. Maybe trying to stay young. People will do research if they want to do research. Yeah, but like I'm 33. So like regardless, my football career would have been over by now. So I still have another maybe hopefully 60 years of life. What am I going to do then?
Yeah, well, I mean luckily here's the thing, man. It's like, see, like the thing is some people, and I don't want to name names. You can probably read between the lines and I'll tell you offline. But there's some people that we both know that are like, ah, I'm done football. You know, the best time in my life is over. some people they don't think that they can make money outside those people who never leave high
School that's what we call them mentally yeah well even uni even uni or even pro yeah the ones who don't leave you like high school or uni the guy who stills profile pictures is university yeah
And you're 34 you know like it doesn't make sense no I think of this too man like and then I'm like this is the peak of their life and then you know the guy who's always at the bar talking about how good he was back in the day yeah like back in the day I used to bench like 300 yeah yeah it's like It's like you have to kind of reinvent yourself, man. Like that's what you're doing. Some people, they can't do it. Like I know legit smart people, man, like played football, whatever, out the east, whatever, went pro. And then after they go pro and then they get cut, then they're just like, okay, bummer. Let me just be, let me just like work in the government, you know. Woe is me, whatever. Yeah. And then they just talk about, or when they go out, they like talk about how they used to run the town and they used to do all this and blah, blah, blah, blah. I'm like, bro, there's more life than that. And then it gets super fat and then it's like, it's really sad and it's like, whatever. Yeah.
Or they become personal trainers or they kind of stick to that routine. But there's more to life than that. And one of the things I really focused on was I understood that this will eventually end. When I first got into university playing football, I didn't understand it was a business. It was actually one of my coaches. Before I left, he told me something. I told him. I kind of brushed it off. He was like, everyone's an all-star from somewhere. So what's their pursuit from them? And I was like, whatever. I'm really good. A couple of early couples, I'm great. I get there. Motherfuckers are good. And I'm playing against grown men. Remember, some of these guys were 28 on the team. Yeah. Because this was before the age gap. Yeah. You were how old? I was 18. Yeah. It's like child abuse. Yeah. I was 18. Some guys were 28. Some of the guys were 25. Yeah. And it was just like the game was just a million times faster. Yeah. And then you have to learn the playbook. If you didn't know it, on to the next. I agree.
I had this coach. Because I had this coach. Let me call him out. Coach Tracy. and then Pat Tracy. And then one thing that he said, one thing that he said that stuck with me is that he said that everybody is so happy that they're just here. You know what I mean? Some people are just happy to wear their jersey. Yeah, but then the thing is, we're trying to win a championship, so it's like another quantum leap. It's like you're in your business too. Because I feel like football transfers are lots of business now. What do you think?
So the way I view football, again, when I was at university, I wasn't the best. I didn't dress much at all, to be honest with you. I stuck out. I should have left, but I didn't. So I want full disclaimer there so nobody leaves angry comments. Well, you're going to be transparent, man. Yeah. Okay.
Most people watching can never even do 1% of what you did anyway.
That's true. But the fact of the matter is football is a contact sport, right? Yeah. And I find that business is the same way. Yeah. Because football is you age out eventually. There's always going to be someone who's younger, faster, more hungry than you are. Yeah. But in business, the older you get, the sharper your knife is. Yeah. The more resources you have, the more connections that you build. Yeah. So like, and if you can take the same mindset you have in football into business, there's no way you're going to lose. Yeah. There's no way you're going to lose because you already know how to do hard work. You already know how to rehab your body. You already know how to discipline yourself. Nobody wants to get up to do 4 a.m. workouts or 5 a.m. workouts or 6 a.m. workouts. Yeah. But you already have those disciplines instilled in you. Just transfer those disciplines into business and the sky's the limit.
I agree. I agree. Man, football honestly taught me probably more than my degree, to be honest, in terms of the life lessons.
I do agree with you because the people – football was the first mentors you have. Yeah. And you didn't even realize that you were being mentored.
Yeah, no, I agree. I agree. Because I reached out to my coach, Apache, and I reached out. I'm like, man, at the time, it took me a while to realize the wisdom in your coaching style because he was very – at the time, I was just like, whatever, whatever, just follow whatever. But then I started to think, 10 years later, I'm starting to think, I'm like, wow. It actually applies because I see a guy, I see a client, I see a guy I hire or whatever who's doing this. I'm like, this reminds me of a player that doesn't act well. You know what I mean? So it's like-
And then they teach you how to deal with different personalities. Yeah. Because the DBs are pretty boys, so you got to know how to deal with them. The D-line is grimy. You got to yell, stop holding, stop face-mashing. And the linebackers have to be the smartest people on the field and the safeties. So they teach you how to deal with different personalities and different people on the team. I totally agree.
No, that's classic. No, that's what me and my mom always say. Like, the DBs are always the pretty boys. Yeah. They always have to change. Never want to get tackled. Yeah. They still got the Apple watches on. Yeah, yeah, yeah. Like, bro, like. They have, like, all the crap. Exactly. Eye clothes and whatever. Exactly.
And the D-line is anti-swag. And they're like, let's just hit guys and go to the club. Exactly. It's the mud, right? Yeah, yeah, yeah. It's the trenches. So, like, and the teacher, like, and then when I left football and I went to the coaching side. Yeah. I'd really like and I was coaching kids between the age of like 14 and like 16 Yeah, but I try to coach them like University and I remind them that hey some of you guys are going to go pro and I Coached in the summertime so it wasn't just bantam. It was like the summer league It was so it's the best out of like everyone and I told them like University is a business So I treated it like it was a business to them and I really and a lot of them still reach out and tell them I was like I was the best coach ever had Because I treated it like it was a business. I gave them homework like I was University You have to watch film. You have to break it down. Oh yeah, film. Because the universities, the coaches see who watches film and who doesn't. Yeah They don say shit but they know They know They know who watches film they know who don We just broke it down that way and I showed them how to watch film and a lot of them came back to me like yo coach like everything you taught us you doing it now so I I was like they like I already know what to do so I was like that's basically what it is and I remind them it is a business at the end of the day if you feel like this is a bad business decision for you you should leave because I I chose not to leave when Sumarah left I chose not to leave steve samara so steve
Bring him up to speed.
So Steve Sumarah got fired my freshman year. Okay. We're his last recruiting class at St. Mary's. Okay. And then he got a job at Carleton. I chose to stay. I chose the team effort and all the seniors were like, no, you guys shouldn't drop out or you should stay here and blah, blah, blah, blah, blah. I chose to stay. Worst decision I ever made. I dug it out, but I should have left. I should have left. I don't think I was ready to play at that level. I was ready by year three or four, but again, year three or four, right? I should have left. I should have went to CEGEP or came back to Ottawa, played for the Sooners or something like that, and then take two years, build my body up, and then went back at 20 or 21. Yeah. But I didn't choose to do that. I chose to stay. I should have left.
How many years total were you in that whole?
Four years. Okay, four years. Yeah. Okay. Okay.
Man, I feel like we're kind of like black business Joe Rogan right now. Yeah. You think so? Yeah, because we're just real, you know? And then it's like, instead of comedians, it's like people that played sports, you know, in business, you know.
I think it was hand to hand. And the people who are the most successful ones can look past sports. Yeah. A lot of kids, a lot of people are stuck on like the glory days. Yeah. Yeah. No, it's really bad. Go on. If you look past sports and you can apply what you learned again in business, like the sky's the limit.
It is. It is. It is. How did you not get stuck? So like some people, anyone watching this, some people, right, they see like they're just like something in their life kind of ends like, okay, sports or whatever, whatever. You know, there's no way forward. How did you be like, how did you just be like, okay, hey, let me figure it out. Let me go, you know, suffer in this, you know, make some, scrap some money together and then let me build this business. Like how did you transfer from football, whatever is done, let me do this. Like how did you get out?
It wasn't easy because when I played for Sooners, I was kind of like chasing a ring in a way. Yeah. Because Wells came in like semifinals or always came in second. So Sooners, that team was stacked. Like Quasi, we had a team that was stacked. That team was pretty stacked and we had a loss. We came up short again in the finals. But it was a situation where I had to really take a step back. And it was like two years of my life I was just figuring it out. Yeah. Just again like if I knew about mentors sooner, I would have got a mentor or find someone who could help me But it was just two years of just figuring out and one of the turning points was when I was doing uber eats when I lost My job. Yeah everywhere. Yeah, and I bumped into someone I went to high school with oh, yeah. Yeah, bro. It's embarrassing Yeah, you know like honestly like I see you living for their house. Yeah, Harry like they have like like they're 24 25 at a time They're married. Yeah, like they're they're you know doing well they have a good government job and you want that success for yourself yeah I'll be really honest
With you living food to their house bro like it was embarrassing no I'll be really honest with you like if I see somebody doing uber eats like like like I I've gotten better at it though but I will judge them but I've gotten better at it I've gotten better at it because hey like I don't judge them because I've been through it yeah because you don't know what someone's going through well I've gotten better but like have you ever been like because like we've all I think we've all been here have you ever been like jealous of people when you're like on a come up before you knew that you know you you'd be successful that's one of the things I have to do with those two
Years it's kind of like like social media is not real yeah so you have to be like what you see what people are what people are going through like more wasn't jealous more envious in a way because I was like how is this like I won't say it in a bad way but how is this person which I know personally is not a great person doing so well yeah I'm struggling yeah you know like why is life so unfair yeah and that's how I viewed it and I had to turn off the noise I had to turn off all the background noise and actually lock into like finding ways to make money outside of my nine to at that time, right? And it wasn't easy because like transition outside of like once you finish school and like you don't have that routine anymore, it's a weird transition because you move back home. Like you don't want to really be home. So like it was a weird transition to like get myself going again. But once I got my footing, it was just like every year was like a growth. Like I figured something new out and I started doing this and now I'm here, right?
I think sometimes the schools, they sell you a bit of a dream a little bit because you're paying a lot of tuition. A lot, a lot. Well, yeah, a lot. Let's call it what it is. Yeah, you know, I thought I was going to call it. So quickly, let me tell you something that I think is going to be interesting. Because I had an issue because, see, I played football. I loved it. But I wasn't really like crazy, crazy, like, you know, like I'm going to NFL. I didn't really care. Yeah. I got shoulder surgery. My shoulder was cooked. So I got a labral tear. I had to go get surgery. And then I started all, I started three years. I just dressed in the first year. and I just hung out in the first year because it was like, whatever, let's just keep him for later. So then I played after I recovered from my shoulder, but during that spring, you know how you have spring camps and all that stuff? So I didn't do any of that stuff. But that's actually what got me into business, because I was able to go to all the, because Queens is a business university, so I was able to go to all the commerce kids clubs and this club, this business club, that club, whatever. And then that's how I learned about like, okay, venture capital, raising money, He started doing this. And then I actually got more excited over that than even football at some point. But it's because I got that shoulder issue, that's how I even got into it. If not, I would have just been like an NPC. Yeah. Yeah, I wouldn't be in a freaking party.
You probably got a government job once you graduated. Yeah. Something like that. And then just, okay, no disrespect to government workers. Get that out of the way now. We can use that as an example. We just live in a government town. Yeah. Everyone works for the government.
Yeah, but something we have to clarify, I think for the viewers, like let's say you're the states, here in Canada, people don't ... I'll just say it up front. I can say it because my family's high in the government. A lot of people don't respect a lot of people who work in the government. I'll just say it flat out. This is what it is.
I'm in government buildings, so I can't talk too much about them. I love what you do, but ... I own businesses within government buildings, and I see it. see it firsthand like one I so one of the jobs I had more many jobs yeah um I used to work for a moving company and they had they had a massive contract to move government workers around yeah great great business model great contract and I remember I met a guy in construction this is when I was thinking about starting my construction business and I asked him I was like he's like he did construction for 20 years from like 20 to like 42 he's and he just got into the government yeah and I literally asked him I was like so like how you find the government why'd you leave construction like yeah the money's better I know it's hurting your body what's going on he looked at me dead in my eyes dead in my eyes and he told me I'm only here for the pension well yeah yeah at least he's honest like I'm not gonna lie I kind of felt that in my gut yeah like damn I can't be you fam like I couldn't like he's like I'm only here for a pension like and then he explains like my body was beating on me like you know like um the company I worked for didn't have much like the pension wasn't really good so as soon as I got into government I quit everything I came here like I hate my job but I have kids no he literally told me he's like I don't like my job but I have kids and a wife and I need the pension. So I'm like... At least he's being honest though. A lot of people can't even just say that. Yeah, but at the same time I looked at him and I'm like, I couldn't do it. I couldn't do it. And I've been offered government jobs, but I just couldn't do it.
Well, at least you have a fallback plan in case like you...
Nah Yes Yeah Bro Never Never get rich or die trying Honestly it better to die on your feet than to live on your knees Type shit Yeah Yeah So I couldn't do it. So I just seen, and then other people I know who work for the government, they only live for the weekends. Yeah. Very few people I know, there's some of my friends who love what they do. It's very niche. Yeah. Like they specialize in something and they love what they do. Yeah. There are some people like that.
Like, I don't know, like, cause I don't know if it's conflict of interest. so I probably wouldn't shout out, you know, like I guess. Yeah, no government workers. You're not trying to get nobody in trouble. Yeah, yeah. But like there's, I guess let me just say like a relative. She actually cares about what she does, you know. She really cares and she wins like medallions and like, you know, all these awards, top powerful people in Canada, whatever, whatever. But like she actually cares about what she does. Very few people that care about what they do. But it's really rare. It's like really rare. Because I talk to a lot of people because I'm curious about what they do.
So I ask them, I'm like, do you want to move up? A lot of them don't want to move up. A lot of them want to stay where they are in their niche. Like one of my clients, he actually worked in a building. We did his basement. I asked him. I was like, you've been in the same position for 20 years. Yeah. And you run a very small team or it's just you. Because he's specialized in something. He was like why would I move up to manage 10 15 people for a 5 or 10K bump race It doesn make sense to me Like I prefer to just work on what I good at by myself they won fire me because I really good at it and they won move me up unless I want to so I just gonna stay here but while I move up I continue to move up for very minimal money and I I get what he's saying but like for me like my ambitions will not allow me to sit where I'm at
Yeah well yeah there's that because well I mean I think it's so here's the thing man um what are your thoughts on money too because like some people are like because I feel like that's money motivation but in the wrong way because some people are like okay like the individual I was talking about before it's like hey let me let me go as high as possible so I can change as much as I can and change the actual country like some people actually have that mindset where they're like okay I don't yeah you know money whatever I have to just work I'm not part of the 459 club yeah I actually want to change the world or change the country or whatever and then there are other people that are like and let me just make my like um my 80k my 120k and call it a day
You know so that's not it for me so for me I understand for you to create change within your community, you need influence. Yeah. To get influence you need money.
Yeah, but tell me, tell me like what's your, like I know there's the money, but then like, what's the, what are you seeing? Like what's, what are some things that motivate you?
Again, like mentoring young people. Yeah. Cause to watch their growth and to help them to get what they need, it's big time, motivates me to take care of my family Yeah The people around me I care about Yeah That really motivates me And basically a big fuck you to everyone that told me I couldn do it I love that that basically it right I love that I told me you wouldn be here like you wouldn make it this far you know you couldn't graduate high school well I'm here I'll be honest with you yeah yeah well I mean man
So many people like look down on people and then like they end up working for you man you know I don't know what it is like and also construction and trades like the people that I or the richest are either in YouTube or in the trades. So it's like, but the people that are the brokest are probably just like paper pushers.
Well, I ever read the book by, what's his name? The guy who did Rich Dad, Poor Dad.
Kiyosaki?
Kiyosaki. It's called Why A Students Work for B Students and C Students Own Everything or something like that. And B Students Work for the Government. Yeah, and B Students Work for the Government. So you know it. So it's the same thing, right? um school is not taught to you know for you to be creative yeah so you understand this because you're a businessman what is the first programs that are cut in school when money's tight
Uh actually you don't know um isn't it's like um kind of more the like civics arts arts arts
Are the first programs that are always cut in school when money's tight.
Okay okay okay so where were we at so we're talking about uh a lot of things but I think let's okay let's rewind the clock so we're talking about deals that you're working on yeah you know and then you're saying that uh that what you had a deal in manitoba you said I can't say too much
Okay but um yeah it's in a manitoba okay area okay um and we found the deal it's a great deal because no more like it's b2b sales and he does direct um b2c yeah and it's a windows indoor manufacturing company I can say that because I was on the listing right okay um but like the business was so well set up and my business partner is actually from manitoba oh yeah so the fact that I asked him I was like hey how's it over there he was like if you dominate a market you eat that whole market because he he grew up um so quick background on him you'll meet him eventually but yeah both his parents are doctors from Nigeria yeah um came here came to Canada moved to Winnipeg because at that time Winnipeg in the early 1990s are still developing and they offered them jobs there and they've been there ever since um so he grew up around uh very wealthy influential people in the medical industry in Winnipeg um and was exposed to very different businesses and he said like if you own any type of franchise or any type of multiple franchise or whatever it is in Winnipeg, you dominate the market because nobody else can really push into that space, right? He has a friend who owns five or six restaurants, and it's only in Winnipeg, and that franchise does very well because it's only there and slowly expanding, but it does very well. And this company that we're looking at, nobody was more than 12.5% of their business. So they're very spread out, very evenly across Manitoba, and it's the history of the business. It was founded in 1960. So long history. And once you are in a segment in Winnipeg or in Manitoba and you are doing decent numbers, the business is doing about $10 million a year in revenue and about $1.8 to $2 in EBITDA.
Are we using freedom dollars or North Pole dollars?
We're doing the cold dollars, the polar bear dollars. So for those who are American, it's doing about $7 million to $8 million USD. Yeah. And EBITDA is around like $1.2 million to $1.6 million, I would say.
Got it. Yeah. Got it. Okay. So, okay, this is interesting. I want to size. I don't know if we can talk about this example deal, but I want to size it up. Because you're saying, so if we were to get this funded, let's walk through that. So you want to see where can you get the capital sources to get this deal done? What do you have? How does your capital stack look like? What type of people are you approaching, and how does it look like that?
So we're very new to the PE. I don't like to call it PE because I'm not looking for a five-year exit. I want to buy and hold because these are legacy businesses. So I want to find partners who are looking for the same thing, good cash flow within a business. This particular business comes with property. Oh, yeah? Yeah, oh, yeah. The property will appreciate over value. Half of the sell price is the property. so that appreciates over time right it appreciates over time the value of that goes up and I'm more looking into like the the 10 to 15 year mark maybe we might sell within that time frame but a lot of investors are looking for a five to ten year exit right which is fine but the businesses that I'm looking into don't really offer that unless you stack so except for buying one windows and door manufacturer I find seven in winnipeg and I buy them all and stack them all together and I roll package that yeah roll it up and then and then I sell it I don't want to do that okay I don't like I feel like because like you start cutting here the people are losing jobs um I was watching actually a video on tiktok shout out to whoever the creator was and he was like your biggest flex is not your car or your house is how many how many families do you feed a year you know how many people you keep employed how much you give back to your community yeah that's a flex to me yeah so for me to buy a roll-up and then fire because you don't need 30 managers you know because you bring it down they can manage across the businesses I feel like I'm laying a lot of people down and I don't want to do that not just that I don't let them down but I want to give back to the community and I take from it and I feel like a lot of private equity and no shade to them the way they do it is they're taking from the community because I'll give you an example plumbing hvac companies they're
Buying those like crazy right now yeah well we're just we're just making a joke offline about what like we're talking about like little haiti down in miami yeah it's fully gentrified yeah well and Let me tell you this. So you're born there and everything.
I wasn't born there. I was born in Haiti.
Oh, my bad. In Haiti and everything. And then you went there. I visited. And then I spent four months in, well, two months in Orlando and then two months in south. Yeah. Like a year and a half ago-ish. And I mean, I don't see this gentrification that you speak of, though. Like, I just saw. I saw. I didn't see that.
Skyrises are going up everywhere, man. Like, so I saw. They're creeping. They're kind of creeping closer. Yeah. So, like, it's getting there. And Little Haiti pricing Just Miami in general So they just released I think it was New York Times or Bloomberg They released an article that Miami is outpacing New York City for rent costs
Oh yeah, well obviously The reason people go to Miami is because it was cheaper in New York
It used to be retirement village Yeah, but it's changing Because all the hedge fund guys are there Everyone's moving south Because all the incentives to move south And I grew up in Miami Doing like the 90s in the early 2000s where, believe it or not, drug money is what built Miami. Yeah. At one point in time, like, if you guys don't know, like, the Canadian viewers, they don't know what a credit union is, but credit unions, you know what a credit union is? Credit unions are, like, the best things ever.
Oh, credit unions. Okay, okay, okay. We have them here.
Trash. Trash. Compared to down south, completely different game, right? Banking laws are different, but we'll get into that. Yeah, yeah, yeah. But some credit unions had more, like, banks in Miami I mean, in the 80s and 90s had more money than the Federal Reserve Oh yeah Brother like when the cartels are going down they Like Florida was built on drug money Like especially southern Florida It is a port city It was built on drug money Like, from the 80s and the 90s. And when all these banks, like, the banking laws, a lot of banking laws changed because of that. Yeah. So.
Dang, I didn't know.
Miami was built on that. Yeah. So, like, and now it's moving towards tech and, like, entrepreneurship. And, like, a lot of crypto worlds are there and, like, influencers. Yeah. Miami's slowly becoming what L.A. used to be. Because LA is not. I don't like LA. I went there. I don't like it. That's what Miami is becoming. Yeah. I don't see that.
Well, Miami seems really clear. Well, downtown.
When I went there, I haven't been there in 10 years. I went to go visit to see family. Okay. It takes us a long time. So we grew up in North Miami. Okay. So I just remember shooting straight off. But North is scary. But like. No, North Miami wasn't scary at all. Really? Again, as a kid, you don't notice stuff.
But this is 10 years ago?
No. So I left Miami in 06, 07. Okay. No, 06 because we moved to Central Florida. So we moved like Port St. Lucie. Okay. And then we used to go back and, like my grandparents, there's only an hour and a half drive. Yeah, yeah, yeah. We used to go back all the time. Yeah, yeah, yeah. And as a kid, you don't realize, you don't see what you see. Yeah. And then I went back again after like my first year of university. And it was still like stray dog shootings. I remember my little brother actually got jumped at the corner store just for being there. Yeah. Wow. He got jumped just for being there. Scamming. Like Miami's known, biggest scammers ever. Yeah. And then I recently went there. I was like, this is Starbucks here now. And you know Starbucks, the Starbucks effect. Yeah. I mean, bro, like the amount of like research Starbucks does before they plant a place. So when Starbucks moved in, I was like, this is not, this is not where, because so where my grandma lived is 10 minutes from the Hard Rock Stadium. Yeah.
So it's primarily. Oh, you mean the thing shaped like a, it's like shaped like a guitar, right? Yeah.
So it's a Hard Rock Hotel and Hard Rock Stadium. So Hard Rock Stadium is where a dolphin split. Okay. Yeah. So she lives 10 minutes away from there. Okay. So.
Is it close to the basketball stadium?
No, that's downtown. Oh, that's downtown. Yeah. Okay. The Heath Stadium is like on the water downtown. Got it. Hard Rock is like North Miami, like that area. Yeah. And I just remembered, I know it was all prime real estate, but like it was always like lower middle class working families. But now like her property value, she bought the house, I think for like 180 is worth seven now. Yeah. You know, like, yeah, like the property values are insane.
And this is like a 180,000 and then 7 million.
No, 700,000. 700. Okay. Okay. Okay 700,000 now So it's like The property values Are skyrocketing
Yeah well maybe It's just that the dollars Is crashing now That's good
No it's just a land value Everybody wants to be in Miami
Well yeah compared to Miami And I found it very But I do find it clean Like the downtown part Like Brickell Brickell Like Brickell
Brickell's not Miami bro Oh fair fair Like you know Miami has gold teeth And fat dredge That's Miami I know The king of diamonds If you know you know Like king of diamonds Tootsies Like 11 Like that's Miami Like South Beach and like Brickell is not Miami. You have to get off the island to go to real Miami. What is Brickell then? Brickell is Brickell. Brickell is where because that's all I know. Think of it as like a tourist trap. Oh, really? Yeah. Think of it as like like downtown Toronto type thing, right?
I mean, downtown Toronto but here's the thing. Downtown Toronto is dirty compared to Brickell.
It is dirty but like it's kind of like a tourist trap. Like think of it like next to like Roger Stadium like that area like next to like the train station like it's very like it's very controlled. It's like really Mickey Mouse. Yeah, very controlled. like this heavy police traffic like it's very controlled that's why I like it though it's really nice but once you get off of Brickell and you see the real miami like there's like it's a lot more to offer you know and like uh the the the the first like the different cultures are there the different people you see like when I grew up there there was no like africans there like there was no nigerians I didn't mean nigerians I came to canada there was no africans there was now there's like africans there's like a lot of lebanese there's like indians it's still heavily like dominican and like very hispanic very um caribbean driven but now it's like a lot of like indians and other races that you're seeing like it's becoming a very big mixing pot yeah my friend found a lot of uh a lot of jews there too yeah jews were always there yeah they were always there they have their own role like they're all there they're always there money money old money yeah well I mean I
Know a few that are MCA lenders there so uh what's MCA um um merchant cash advance oh yeah like 50% interest rates. We have to refile a guy out of that, eh?
That's criminal.
Yeah, he had 800K of 50%.
Interest rate? For how long?
I don't know. But we have to get him out of that. And then now he was just at 16. He's like celebrating 16. And then he has to refile that too.
Jesus, you guys are wizards then.
Well, I mean, I don't know about wizards, man. It's just like, there's just too many things. Because you do a lot of, your mentorship, you do some origination. Yeah. But origination is like a whole, you can get a PhD in origination. And then it's like the LOI to about to get the deal closed, that's like a whole other PhD. And then actually raising the money and then having the money go into escrow and actually get wired, that's like another PhD. So I feel like this whole M&A thing is like a lot of... Again, back to the sports analogy. Yeah.
A lot of shit. It's a contact sport. Yeah. It's either, hey, this is going to knock me out or I'm going to knock it out. It's simple as that. Like in football, right? What did they tell you? You want to be a hammer right now? Yeah. There's no in between, man. There's no in between. You want to be the hammer right now, right? So there's a lot of deals out there. There's a lot of deals. And some deals, like I learned that I'm in the right niche. Like the businesses I'm looking for is anywhere between $5 to $10 million.
Yeah. Tell me about that because we're talking about that example Canadian deal. But like tell me about your criteria.
So my criteria is very simple. Like service, distribution, wholesale, B2B, and manufacturing. Okay. That's my criteria. Okay.
I mean, that sounds like everything though.
No, it's not everything. You said B2B. So business to business, wholesale type of business.
Oh, okay.
Any business that's B2B, you make a lot more money. Margins are tighter, but you do great volume. I agree. Because think about it. My motto is sell the shovels, don't dig for gold. Yeah. Because if you dig for gold and you miss, you're losing money. Yeah. But if you're selling the shovels to everyone who think they can buy the dream. For example, I was watching a video on a guy. He owns a t-shirt company.
He makes millions because he prints other people logos on his t And it high quality stuff It not like the stuff you get from No Shade Throne but Vista Print or anything like that Yeah yeah There a guy I know the richest guy I know our age back in 2016 he partnered with YouTubers to partner with Chinese factories to print merch or whatever. He made hundreds of millions because he's B2B. Because he's selling a shovel. Yeah, and he's up the value chain or whatever. He's not just like consumer Mickey Mouse baby consumer thing. He actually went to China, built the relationships Felt the fabric themselves And then people went through him because it was safer than to find your own factory He can give you some type of guarantees Yeah, and then he went to the YouTube channel that has like 100 million subscribers And then that's how he sold to people He didn't just sell to like one kid at a time No, he went to like the ones with 100k plus subscribers And built that way And then the word got out like, yo, this guy's great quality, t-shirts, reliable
And they moved on, right? I learned a lot of people don't want to do the legwork A lot of people, and I find out with investors, they just don't park their money and watch it grow. Or they want a trophy asset. A lot of them want a trophy asset. I'm learning all that.
What's that? What's the trophy? Tell me about that.
So they just want to, you know how people put their names on buildings? Yeah. Same thing. So the egotistical thing. Exactly. They're like, you see this guy? I own Blackcore Holdings, right? I invested XYZ with him, and I'm getting this much return. The money isn't as much, but it's secure, and he can brag to his friends that he was one of my early investors. Yeah, it's like the story or the flex. The story matters a lot more to them.
That's why they like, that's why like Rolex, for example, they always talk about, oh, like a diver like went down to the bottom of the ocean and got like a lot. The story matters. The story matters. Yeah, because like to poor people, they don't care. It's like, it's just a watch. But then to rich people, it's like, they like bragging about these stories. Exactly.
If I wanted to dive a hundred feet or a thousand feet, I could. Yeah. It's like a G-Wag. G-Wagons are built to be off-road. When's the last time you see one off-road? They're so delicately like handled. Yeah, that's what I'm saying. But like it's meant to be on a safari or off-roading, right? Yeah. But people use it as like, if I wanted to go off-road, I could. Yeah. That's what it is, right? So people see it's overly built for what it's used for, but that's what it's used for. And that's what Rolex, like I said. So I find a lot of wealthy people. There's investors who are looking for trophy assets or just to brag to their friends and be like, I'm one of the first early investors. And, you know, those are great investors to have. And there's investors that want to be overly involved. and I don't want those investors because there's too many chefs in the kitchen. I already have a team. I'm building a team. Why would I want another person to put their input?
That's your holding company, Blackcore Holdings.
Blackcore Holdings, yeah.
So you want to get passive investors, you said?
Passive investors. I'm not looking for active investors. Okay. Unless they come with a skill set that we need, I don't need them. So I'm just going to toss this word out loosely. Limited partners. LPs, you know them. Yeah, LPs.
Okay. So tell me, what do you want to build with this, man? So what are you building here? So, well, before we build it, let's talk about the deal first. So $5 million EBITDA, you said?
No, not EBITDA. So gross. So $5 to $10 million gross, $2 to $3 million EBITDA. Okay. Right? I think that's a sweet thought because speaking with the banks and other things like that, family offices don't go for deals that size because they're too small for them. They look at $5 to $10 million EBITDA, which means these deals are anywhere from $25 million and up. right I can't like that's where private equity is moving towards now too because unless they're doing a massive roll-up which a lot of them is more work it's easier just to buy someone else's roll-up right than to individually go through the businesses run them for a year build them up and then sell them off right so I find the sweet spot for a lot of these businesses that we're looking for or I'm looking for me my business partner is between five to ten million dollars uh in the cash flow between a million to three in EBITDA. Okay.
How do you structure or what's your proposed structures? Because some people, they go out and then they're like, hey, I'm not talking to a deal unless they have, you know, okay, a lot of synonyms here. Vendor take back. VTBs and stuff. Seller carry, whatever. Sellers finance and all that.
So it depends on the deal. If the deal's too good to be true, like you get multiple type of buyers. The emotional buyer, and which I like them in a way, I just hate them when they're with brokers.
I was about to say I think brokers Are the worst things in the world In my personal opinion They don't work I think the only broker That's okay Is Acquire.com For the smallest tech guys But besides that
I like N3 N3 is Oh what is that They're a local broker In Toronto Okay They're pretty decent They really focus A lot of the businesses I'm looking at trades They're really focused On trade businesses Okay They're very decent I like the way they work But And Acquire.com It's more Mickey Mouse It's like If you're a small Software guy The worst one I dealt with, again, no shade thrown to anybody, and this is allegedly, is Sunbelt.
Oh, Sunbelt. Sunbelt's absolute trash, bro. I heard, not BizBuySell, there was another one besides BizBuySell. There's another one that is really big. I can't remember the name. I know the name. It's just like something. There's another one called Businesses For Sale, and then the one Codie Sanchez owned, I think it's like Biz Buy, or BizNet, I think that's hers.
Okay, I'm not sure. But that's on the American end, but for a Canadian one, another very popular one is Businesses For Sale. yeah businessesforsale.ca yeah that's a very popular one as well we're both aligned that they that
These platforms like no shade to any you know thing but in general platforms like we're both aligned but like I think let's find out why we both think they suck because I think they may be
For different reasons I feel like when it comes to brokers yeah um I feel I believe it or not like I feel like they're more like realtors and it is the same licensing it's the same licensing that you need so to be a business broker you need a realtor license so they literally just send an email mass email to everyone in the email network and then post it online and that's it and then they jack up these numbers and put like these evaluations on these businesses and because they take a 10 percent of deal when the deal close so to offer a VTB or a partial seller finance they highly encourage that the owner doesn't take that yeah I hate that it kills the deal It kills the deal, and in a way, it will have been beneficial for the owner long-term tax purposes, for one. And stable cash flow for the next five to seven years for them or 10 years right depending on the size of the deal A lot of owners hate earnouts And for the size of deals we're looking at, earnouts doesn't make sense. If I was looking at a $15 to $25 million deal, earnout would make sense.
Yeah, and explain to the audience for those who don't know.
So earnout basically means that, just use round numbers. So if there's a $100 million deal on the table, let's say you give them 70% cash, and then 30 million of that would be an earn out which means that if the if the business does what you say is going to do um you get paid out within a period of time for that so earn outs are great when you know if you believe in a business stuff like that and a lot of massive deals have earn outs like stipulations in it yeah and they can like or it's a situation where you get the you get the other 30 million dollars but you have to work in the business for you know x amount of time and if you leave before that, you don't get the money. It happened with WhatsApp. The guy who sold WhatsApp, he had, I think he walked away from like $100 million or something like that. Because he realized that Mark Zuckerberg is allegedly, it's the devil himself. He was like, yo, you're spying on people. WhatsApp was not built for this. Encryption doesn't mean anything. It's documented. He walked away from
Well over $100 plus million. Oh, that's a Signal guy now. That's why he did Signal. That's why he did Signal Yeah, in retribution
Because of that And that was a part of the earn out You have to work here for two years You get the rest of the money Yeah
You know what? Like, this is so interesting You know what? I agree And I also think Because the deal we did a while ago in Texas was Like, he did rural He did Texas? I need to go to Texas Yeah, I mean, Texas is
I like Florida, though I don't like Texas
See, well, I like getting deals done And I find it easier to get done in Texas is just more the population Florida's Texas is like 34 million, Florida is 28. Okay, so it's almost the same. Yeah. You know, for whatever reason, it's all the same thing. Like, it's the mindset. But I don't – so whenever you go to the tier one city, like the city interiors, like Miami, L.A., New York. So for whatever reason, because we're just marketing to the states and just general – so, like, it's hard for us to penetrate those tier one cities. We're working on it. We're more of, like, the surrounding areas. Like we get people in like Orlando or like in Tampa, you know, around. But we haven't actually gotten principals in downtown.
May I make a suggestion? Don't focus on the tier one cities. We're not. Yeah, because I wouldn't focus on it. If your niche is like the smaller cities around them, dominate that market. Become the biggest player in those markets. Because those cities are still growing. Yeah. Like if you're thinking 10, 15, 20 years down the line, like those cities are still growing. And then Miami's going to hear about how good Tampa's doing. Oh, yeah. And they're going to hear about how good Orlando's doing. They're going to be like, I want some of that money. Like, what's going on? Okay. I wouldn't try to penetrate it at all. I would really heavily push for those smaller B cities, as you call them. Because those are more stable markets. Yeah. Those are more stable markets. I can talk about this because this deal is no longer on BizBuySell. Yeah. I was looking at a steel company. Yeah. They sold, literally, all they do is sell steel. Oh, yeah? Yeah. They're not in the fabrication. They actually just sell steel. They just sell the steel. Oh, yeah? They buy it and they sell it to builders and developers or whoever else they need it. Great business. Yeah.
How's it defensible, though?
Great business. The defense, how's the what?
Like, what's unique about them? Because the way that you say it.
There's nothing unique about it. It's just very niche. Like, not a lot of people can buy and sell steel. Different size steel. That's all they're selling. So they're doing six or seven million USD. Good money. And EBITDA was like 1.2. That's good money. And the business was founded in 1980. so great history of the business right um the only thing I like they didn't own the property which means that the lease was coming up and there was a lot of issues there um but this was a business in tampa and tampa is very stable town like I said yeah those are very like we're not building like miami but we're still building yeah so like that same business was in miami probably doing a lot bigger numbers but the the b markets are very stable markets because the front is there's not people moving in and out all the time. They're there.
It's a good take, yeah.
It's a good take, right? So they're there. Unlike Miami, how many people you know go broke in Brickell and have to move back to Ohio? Yeah, like I know a few. But you get what I'm saying, right?
Oh, they have to come back to Ottawa.
I know a few. For example, people who live in Canada, how many people we know went broke in Montreal, Toronto, had to come back to Ottawa? I definitely know some, yeah. Exactly. But Ottawa's a B city. Yeah.
But stable yeah we we keep all that and plus it's uh it's connected to the government so it keeps all that stable stable revenue and it goes to the real estate exactly but like but yeah you know the broker thing it doesn't really make because like it's hard so our guys like the best deals that we see on our side it's like either they know the seller for very long or they just originate a seller the old-fashioned way just linkedin or or cold call whatever and then go from there and because like whenever it's like all dressed up nice they have a nice picture it's also the issue with the whole LOI thing and a proof of fund thing because they'll go to BizBuySell they'll ask them for like all this uh POF whatever then it comes to us then we write them a letter of commitment saying oh we can help you find somebody or oh maybe sometimes we have a you know a high net worth guy and then they can say okay yeah we want to partner with you they take it to the seller the seller is like or sorry yeah the seller and seller is like oh we don't have the um here's just this level one due diligence and it's like yo we don't even have the financials we can't do anything with So let's get into that, right?
So that's one of the things I really have to learn about business, especially dealing with the banks and stuff like that. Due diligence. So especially when we get to these bigger deals, right? If I'm looking at a $5 or $10 million deal, if they don't have audited financials, why are you putting it up for sale? No, because at the end of the day, why am I paying for it? Yeah. If you're making 11 or 12 million in gross revenue a year, why can't you spend 10 or 15 thousand dollars to do an audit on your business to put up for sale? That's a good question. It doesn't make sense. Now, I take the financials you give me, it's unaudited, and then I go to the The bank, the bank, well, you have to get an audit.
Three years.
They ask for three years, right? Yeah, but I feel like... Each year is $10,000, $15,000. Yeah, yeah.
No, that's legit. But I think it depends on the deal size because Canada is a little bit more... This is in Canada. This is not Canada? This is in Canada. Yeah, but Canada is more... But I feel like in the States, it's more cowboy. But when it gets to above, let's say, above $2 million deal size... Because sometimes it's $1 million, $2 million. No. Sometimes like... I usually ask for tax returns and give me the bank statements. I can run that through Claude or Chat And then pick out all the nonsense Right, right But then I mean the auditing Like the auditing Some people kind of like Below one million deals Two million deals Sometimes you don't audit It doesn't make sense
It's not that it doesn't make sense It's like It's too small of a deal Yeah It's really small And you can really pick out If it's nonsense or not Yeah But when you get to like The 5, 10 and up deals Like you should have Proper financials Oh well that's basic
Have you heard of this Quality of earnings thing? Yeah Like, so that's like a weird thing, eh? Because some people, see, the thing is, like, once we cross a certain deal, there's this company in Vancouver. They're called Bond Capital. They provide equity. You can reach out to them. There's a guy called Justin who used to work there, and then he left. And then I'm just going to name drop. These are good people. There's another company called, I know one guy that works there, Andrew. The company is called, it's crazy. I'm going to shut this guy up, but I can't remember the name. but yeah sapling sapling financial they do quality of earnings they do a bunch of stuff um I've never heard of anyone required quality of earnings until we started getting into the bigger deals and then started and then we started going more to canadian private equity and then as soon as we got to above and five million and above and then more canada then I'm like okay quality of earnings quality especially from the pe shops I'm like quality of earnings before I we look at
Anything we're like okay no so the BDC has a threshold of a million so you deal over it so if you're dealing with certain banks so like we deal with the BDC we we know their structure very well we know how what they ask for yeah maybe educate uh so with the BDC you have a you have a you have a runway so that they give you a million dollars to play with before you need to do um financial audits um of a business right so that before they require stamps of approval from cpas and stuff like that so for example if you buy a business of 300 000 and you buy another business for 700 000 you don't need to get financial audits for those businesses because it's under threshold. Anything over a million or once you hit that threshold, let's say you buy a business for $300 and then you find another business for a million, that million dollar company needs to be audited because now the money has to be like they need to see where it's going and if it can if the cash flow can pay the loan.
What do they lend? 80%, 75%?
Depends on the deal. If it comes with property, some deals, it comes with property they'll loan 100% on the property so 100% of the value of the property will be lent out for 25 years. So it becomes two loans.
25 years. That's really good. What are the rates? What are you seeing?
For property? Depends. It depends on your credit score. It depends on a lot of factors, right? So it's hard to say. But it's within commercial limits.
Do they care much about the... So what net worth of the... Because me and Tre were talking about this recently. Tre's like my capital markets guy. What's the... How much net worth... What percent of net worth do they care about?
They don't care about the net worth. They don't care. Okay. It's going to make sure you have good credit. Okay, good credit. Okay. And then we don't know where the money's coming from. That's it. Okay. Okay, interesting.
Because some of the lenders we see, sometimes we find that they care about somebody who's not worth. So if the business is coming up,
Let's say you want to buy a $10 million business, it has no assets, then you need collateral. Yeah. You know what I'm saying? Unless the cash flow is like $5 million a year, that's very hard to justify, right? Yeah. What business do you know is 50% of the EBITDA?
Wait, so are you saying that if it has real estate attached then it just like de-stresses it so much what you know it's crazy like on our deal flies through like that's crazy so you know what's crazy so just because like on the sales side for our stuff it's like we we say that if there's real estate attached then we just kind of guarantee like a minimum amount raised because it's just so much easier when there's just real estate attached yeah so because there's hard assets to take from yeah like the only like unencumbered obviously yeah so it's a situation where it's like he feels more safe because it at least he'll get 50% of money back.
Yeah, but where do you get the other gap? So like they lend 100% of the property plus, and then let's say like, so let's say it's like 90 or 50. So let's look at, this is all hypothetical, right? Say we're looking at a company that's worth, the owner's asking 10 million for it. Just a round number, right? Yeah. The property's worth 4 million. So you have to find $6 million to lend. So what's your thought process around that?
To find the 6 million?
Talk to guys like you.
Oh, fair. That's fair. Fair. we'll just go and then but like you know what's funny it's like we'll kind of like there was a weird deal let me tell you this weird deal there was this deal and this deal kind of made me annoyed so there was a deal in this lady in vancouver her name was sabrina um this lady uh wants to buy a media company she wanted to raise equity but then we're just like eh let's just raise that it's easier so she goes and finds her business partner uh who's an accountant and then we find a lender in the U.S. that leverages her cash flow of her business. And then we use that as the down payments for the business that she wants to buy in New Zealand. It's a media company in New Zealand. So that's the down payment. And then the rest is what they negotiated hard on seller carry hard. And it was a tiny deal. It was like a million-ish. It was really small.
But like- The banks, she should have went to the bank. That's a small deal for investors.
The issue is that there are no assets in New Zealand, man. like New Zealand we're calling banks in New Zealand and it's like how do you even call a bank in New Zealand because we had to wake up and then it's like at like 2am yeah yeah poor Tre was just like for that much work for that little money it's not worth it no it was actually it was actually annoying because like it was actually not that much
So a lot of the guys that I'm talking to that do what you do they tell me like anything under 5 million they won't touch it they're smart it's not worth their time they're smart yeah we started getting it's bigger and then you know it's crazy the money is way better yeah it's like way better it's just like annoying one of the guys I talking to who actually does deal stateside his sweet spot is to million If you want to go higher than that and I like guys like that because they not they not oh yeah I can get 100 million out of the old you don need no experience we'll get it done for you he was very honest he was like if you want 5 to 10 5 to 20 is what I can do for you I know those investors anything more than that or anything less than that I don't want to touch it and I can respect that because he found his niche that works out very well for him and I spoke with some guys that were like yeah you know we take five or 10% of the cut of the deal and, you know, we can get you wherever you want. Like, you don't need experience. Like, don't worry. Just send me the books. I'll take care of everything. I'm like, this sounds shady, bro. Like, this sounds like I'm going to get myself into a lot of legal issues. Yeah, raise a hundred million with no experience, whatever. That doesn't happen, bro. Like, you know, like there's no story behind it. Like, you know, like it doesn't happen. Like there's no experience. Like it doesn't make sense. Yeah. So like I like talking to guys like you who understand like what their limitation is and where they can bring value because a lot of people don't know where they can be. Like, they want to sell more than they actually want the relationship.
Yeah, I'll be honest with you, though. Like, I'll just be honest with you, man. Like, because sometimes, like, I'll be real. Like, because sometimes, like, we're like, yeah, you know, we can do it, whatever. I think I'd have a good team because I'd be like, yeah. And then sometimes, you know, you just, like, you have to go through it. You get kind of beat, beat. It's kind of like. And then sometimes you kind of get, like, what?
Fatigue.
Fatigue. They're a little bit discouraged for a moment when something takes long. And it's like, man, maybe we should go to smaller deals. Maybe sponsors are not smart enough. Maybe like, because like there's always something, there's always stuff that comes up, eh? There's a lot of deals that come up, man. Yeah, we had a deal. This one is anonymous, but like we had a deal where the seller was in the DUI and then they discovered it. And then even though the seller was in the DUI nine years ago or whatever, a particular lender, and this is all anonymous, so nobody knows what I'm talking about. So a seller was just like, the lender was just like, yeah, our board says we shouldn't do it. And so...
So the buyer was in a DUI? Yeah, but it was like nine years ago. And then the seller who was selling the business was like...
I'm sorry, the seller was in a DUI. Seller was in a DUI. Oh, okay. Yeah, I don't know what I said. And then the lender was like, nah, we can't... Yeah, the lender's board was like, no. That doesn't make sense to me. That's kind of weird. It's because they're just like, they have a fund, and then they're just very careful. It's their own fund. Yeah, like the people you're buying from, like the bad media, right? Yeah, they're just very delicate, right? So then we worked with counsel and everything. We structured a promissory note. So we got the seller off the cap table. And then we did the deal without the seller. And then there was a promissory note structured between the buyer and the seller after the deal closed. Yeah. So he paid him off after the deal was closed. Yeah, yeah. But we had to do those acrobatics. And then the broker almost gave up on the deal. It's just because, shout out to Tre on our team, whatever. He just negotiated that. you know and then they're like okay bet let's do it whatever let's rip and they already underwrite they already underwrote it took three months to two months to get them to the finish line they had to meet in person it was really annoying but they got that deal done that way but it's kind of like it's just this weird like hiccups that happen and also this quality of earnings thing and also um but you know what man I think um it's a so basically my point is like um my my the only thing that's motivating me to do bigger deals is the opportunity cost because sometimes it's like, hey, Tre, you have one guy that they have like a like 800K thing. And then you have another guy that lady that has a 14 million thing. And then the entire stack has been said, everyone said yes. So anything that's below, like we have to make like $100,000 per deal minimum. And we're like, we're not going to take any less than 100,000 freaking US dollars per deal minimum. Because like we took like, you know, a few thousand bucks here and there, you know. But I feel like the team got the confidence to be able to really just ask for nothing less. And one issue that we had was actually the sponsor quality. That was a legitimate issue, sponsor quality. Because if the sponsor quality is low, it's actually harder to close deals. We're not even asking for too many. We're not even trying to do too big. We're just between low eight figures, high seven figures. That's all we're trying to do. That's a good sweet spot. Yeah. Yeah, but like, because the thing is, man, it's like, it's like if it deals like 700K versus like 14 million, like the success fees and the equity fees and whatever are like logarithmic.
Walk me through that because I'm new to this and somebody honest want to know. Yeah. For someone who's buying a business, let's say $5, $10 million. Yeah. I don't have, you know, 25% down, which would be, let's say, 2.5 to 3 million. Yeah. Let's put down, right? Yeah. And then your fee on top of that would be 10% or 5%, whatever. depending on the size of the deal, anywhere from 1.5% to 5% of the raised costs, right? Yeah. How would that buyer pay you out once the deal closes?
Oh, the buyer? Yeah, so... I think that's a very good question, in my opinion. Oh, yeah, you mean the fees? Yeah, so, I mean, let me walk through this. Usually it's on the lender side. Like, usually the lender will have people. So, okay, let me just... There's another part, elephants in the room. There's this whole compliance thing, right? Yeah. So we're in Canada in this studio. So Canada doesn't mess around with this. No, they do not. Compliance does not. Yeah. It's a draconian thing. We have US LLCs. We operate a lot in the US and then that's been helping us a lot. Yeah. I'll tell you that. So anyway, to answer your question. So first there's this compliance thing. So basically, first we work with a lot of companies in the US and we work with a lot of brokers in the US and we work with a lot of counsel in the US. And that kind of helps us because we're able to get paid out via those U.S. companies, right? So legit, the Canadian company isn't even involved in those transactions. And it has to be debts. So on debts transactions, it's very easy, especially commercial debt. We do have a license, believe it or not, for residential debt, but for residential mortgages. We don't know. We barely use. But legit debt is actually extremely easy to get fees in America if it's structured. So that's easy. But I'm talking about when you're purchasing a business. But then here's the thing. I mean, who's getting a loan for the business? It's like, we're helping to get a loan.
But what if you're raising partners, equity partners? Yeah, okay, yeah, good question, good question.
Honestly, man, like for that, like we have to, we structure it where we have an agreement with the company you know to ask for equity in the company before the raise starts That what counsel told us And then that helps us get around a lot of the issues And then we structure that as a consulting fee. But it's before the money is raised. Because the thing is, counsel told us that things have to be structured where it's not only about raising money. It has to be about other things. So if we help them under marketing and other things and just as a general consultant, you know, then that opens us to be able to, you know, get payouts and then not in connection to that. So so the council is probably going to watch this and take a look at this. But, yeah, that's basically it. So we were not lawyers. This is just disclaimer. Yeah. We're not. Yeah. Yeah. Seek legal counsel for everything. But yeah. And then the last thing is obviously we have broker dealers. We also partner with two brokers. Well, I hate them, too. But then that's the thing is like there's no choice sometimes. So yeah, you don't have a choice. It's hard to find a good, honest broker. Yeah. But then the thing is like, you know, the issue is like you lose money, but then it's like, okay, then you're compliant. So, you know, we just have a broker that has a broker and then that's like the backup. Okay. Yeah. That's how we take care of that. Because that's a serious question.
Because a lot of like, you know, I'm trying to capital raise. I don't have five, six million dollars laying around. And then the brokers are asking for 10% with LOI assigned. I'm just like, that's kind of ridiculous, bro.
You don't need them. You're smart enough not to need them. And obviously you don't believe in them that much. But like, because we're not really like a business broker. We're just like a capital raising. You know what's 20%? Yeah. We're a capital raising consultant. But one thing, though, is I don't think you need to overcomplicate it because you just get like 80% and then just negotiate seller take back. Like, what's the...
No. So the broker, so when you usually sign an LOI out of good faith or good will, they ask for a deposit. Oh.
Oh, the buyer?
Yeah. No, the broker.
Oh, well, but don't work for brokers.
But like sometimes the deals you're going through is through a broker.
I mean we don't It doesn't make sense to me
I'm just like I'm not even committed Like now my money's locked Into your escrow For how long
We had a lady that I mean Bart's talking about Like what are you talking about Like 100k or like Just 10k or 5k
10% They want 10% Of the deal Locked away Like if we're talking 10 million dollars
Yeah we don't do those deals Yeah Yeah we don't know Like we have a lady right now So we got a lady She got full debt commitments Her name is [name withheld] And this is a real deal Happening literally right now So we're expecting Let's see it's 14 million It's 108 units in Minnesota. Oh, good. Yeah, so let's see. How much did she have to put down? She got full. So we were able to push it forward. I encourage you to look in the States, man. I think you have more fun there, man. I am, but like. Yeah, you have more fun there. You'll be able to actually get something done more.
I'm American, too, and I do have LLCs. Sorry, I have an S-Corp state side as well.
Yeah, well, I mean, like I'm not really pro-US or pro-Canada. I'm just pro-getting deal done. But like, yeah, no, she put like 10K into, like it's kind of annoying. Sometimes people ask for a deduction piece even after us. So like she put 10K down and then she has to put another 15K and then that's all she has to put down. So she has to put on 10, 15-ish. The Cody deal we did, like the main guy on our website, Cody, like he did a 3.4. One million of that was MCA refi. The other two point something was the business acquisition. He put 10K for due diligence. but the deal actually closed because it was like another it was a lender that was like attached to like a fund or whatever it's kind of annoying because like they say that they're direct lenders and they are and then they still charge you money yeah she's how it goes yeah but anyway you know just don't do it man I don't know I don't know how to solve that problem
The 10% like I don't know how to do it no we tell them no we usually tell them no yeah and we usually tell them we're using investors money so we're not locking their money away with you yeah that's just not happening yeah yeah
Yeah, yeah, because I don't know. I mean, I think the $10K to $5K, I think, like, worst, worst case, we can't find anybody $10K, $5K, and then they're serious in the research. I think that's okay. But I think when it goes to, like, $100K and 10%, I think that that's stupid.
Yeah, they wanted a million dollars locked away. Yeah, no, that's [bleep]. Like, who's going to lock a million dollars in escrow?
Yeah, that's idiotic. Yeah. I mean, at least it's an escrow. At least we're not saying why are it directly.
No, but, like, no, like, escrow accounts are getting drained. You know this. Well, the problem is. They can't get, yeah. The brokers make money from that, right? It doesn't make sense to me. Yeah. So for me, it's like, LOI is not committed. Why make me commit with 10% down? Do you know their data room?
Do they give you their data before they... Yeah.
So the data room is given to us. Okay. And we have a lot of questions. And like, so this deal was a very interesting one. Yeah. We haven't closed a deal. Just before you...
We haven't closed a deal where anyone asks for 10% of the deal. We haven't closed any deal like that or even seen anything.
Brokers, like when you deal with brokers, especially, they always ask when you sign an LOI. Yeah. And the owner decides to move forward. Yeah. They ask for 10%. Yeah. of the total cost of the deal.
Yeah, skip. It's like swipe left on Tinder or whatever. Yeah.
But some of these deals are good, but the brokers always kill the deal because you ask for a VTB. They tell you the owner doesn't want it. But I find out a lot of these sellers are not educated on that. Yeah. They don't understand the tax benefits, not just the tax benefits, but the stress on you. If you believe in the confidence of your business, you'll take a VTB. It's a sales process.
I think really all these ideas, our sales because like either the broker's selling them on something or we are and I think they can all work if they get a big bag of money that could work if they get like because the rollover equity thing and I'm not even talking about VZ that's another benefit but the rollover equity thing is crazy because they can retain equity that's another they can retain equity and then that can they can have huge tax benefits in that too and they can even make more like if you're doing a roll up and you're buying and holding and you do rollover equity you know how much money a seller can make because the valuation of your thing you buy a bunch of and then when you sell everything at once that equity is worth way more than what they have. But they're not thinking about that. They're just thinking about leaving. Yeah, and then they're passive investors. And sometimes the lender can even like that more when there's VTB or whatever thing because it shows that the seller is kind of like skin in the game. It's kind of like they're not just running away from a sinking ship. And then it also shows that it's flexible. So you can be like for the VTB and then for both rollover equity and VTB, The seller can, you can play with the interest rates, right? Because the issue of the real loans like the BDC or an actual legit loan is that it like based on the market But in this one you can be like oh hey three years then balloon payments it like I can kind of pay no interest or I can not pay a sense until three years until five years until three years whatever so you have more flexibility to maneuver and then to model your money well so that at least you have time to like put money into the business instead of paying a bunch of loans right so like it's really good like but then I think you need a serious operator that's legit like a legit business
Person to do it but that's where does this sweet spot these businesses come in right yeah because they already have operators in place yeah it's like if I don't burn the ship down I can cover debt yeah I can make good money yeah and just ride the wave right so that's why I said the sweet spot is five to ten million because you don't have to be there you just have to oversee it and you're still learning like a lot of these deals we're looking at they make a lot of money and I would never look at a deal where the owner's heavily involved yeah because if the owner is the business even if he's making a hundred million dollars he's the business yeah you know like again we'll use a big big time youtuber of acquisition.com oh yeah why would I buy that even if he'll selling because he is that business okay mean uh what yeah oh yeah because he has the business like he's the face of the company if he leaves like I don't know if he wants to sell anymore no I'm just I'm just giving an example right like those people are the business right a lot of the these youtubers they're the business if they leave the channel dies
Yeah, because I like Leila Hormozi and then the other guy. There's this Indian CEO too. I like those other guys, his sidekicks or whatever. But the thing is, if they leave, people are there for Hormozi. Yeah, 100%.
If he leaves, though, how much value is it still worth? I mean, it would be worth a lot still. But without him. But you bought it at the peak. Yeah.
And you have to bring it back. Yeah, she's still owning. He probably owns a lot of businesses within that. Yeah. But he's the face. He's not stupid. He knows that. He knows marketing very well. I like to watch his videos, man. Yeah. You know, it's funny. The guy's a marketing guy. I love that guy. It's funny. Remember he used to say, I'm not going to sell you anything.
And then he became the biggest salesman in the world. Yeah, his book broke. He sold like $100 million on TV in like eight hours. I'm like, I'm insane. He's the best salesman of all time. I think so. Me personally, he's a great sales guy. But I like him because he knows his role. Even he said, the companies he buys, he knows nothing about. He hired a good team. he had a lot of capital doing his exit he put that capital to work he has a good family office that buys businesses and then he signs checks from time to time and he really focused on what he's good at which is the value that he brings is with his name and marketing and he brings a lot of value to different businesses doing that
I think school is going to be the one that they'll exit because I think school is like less dependent on Hormozi for sure I think that's that'll be a five year exit for sure yeah and then Sam Mubbins is not because Sam Mubbins was my mentor you know how I used to look at mentors Sam opens what's mine. And then I think Sam is more in the background. And then school is more UGC, user-generated contents. So I think school is actually more like they're trying to make money on the sale. Because it's SaaS, right? Multiples are insane. I don't know about you. You're 10x, 20x multiple. Yeah, I don't know about you. I don't mess with SaaS anymore.
I told you, again, I'll say it for the audience so they understand. I only do boring businesses. I sell shovels. I don't dig for gold. and that's where I find it's harder for me because everyone's on the AI race. And I'm like, if I can buy a boring business and implement AI, then I can sell it for XYZ. But I'm buying them to hold long-term, to build within that community, to continue to run it for another 30 or 20 years. That's really smart. And it's very hard to find investors or people on board to do that because they all want that quick. No, I'll give you a great example. I won't say any names, but this is a great example, right? We're looking at deals, a million dollars locally. And we got an investor to do it, right? For the 25% down, and the BDC was going to fund the rest, right? The 25% down, I think, was only like, we negotiated down to like 750. So it was about like 180, 175. And he was getting about, I'll say, anywhere from 30 or 40,000 a year on average. He said no. Or he wanted more equity.
Oh, you mean the person putting the 25%?
Yeah. He wanted more equity. The angel investor wanted more equity. Okay. And because he's like, I'm taking all the risks. I'm like, well, the loans aren't our names.
Wait, how do you get him to put the money down and then you are the one who...
So in Canada, if you own less than 24% of a company, you're not legally responsible for any debt. Oh, that's hilarious. In the States, it's 20. That's so funny. I didn't know that. So you're called a minority shareholder. Yeah. So you don't have people own stocks in Apple. If Apple goes bankrupt or any of those companies go bankrupt, are the shareholders legally responsible? Not at all. Nobody owns a massive part of the business to be legally responsible. So that's how we're able to get him that. And then he wanted more equity within a business or more of the cash coming towards him. Because in his mind, he's like, well, I'm putting $180,000. I'm only getting $40,000 or $50,000 a year. I can buy a house, flip it, and make $100,000. That's how he was thinking, which is fair. But how much work do you have to do to flip the home? You have to buy materials, buy the property, get permits, do all this stuff. You're making anywhere from 30 or 50k a year Doing nothing And then no shade towards him But he just didn't see the value in that He was like well I'm taking more risk So I want more Even though we're taking a bigger risk Because the loan is We're personally guaranteeing the loan But those type of investors I don't really want to deal with Not saying that they're not good people or anything like that It's just for them They can't see past the quick flip Because they're used to doing the quick flip They're used to buying a property and going through the headaches of hiring contracts because they've done it so much in so long They have never done a deal where imagine you put out a million dollars into different deals and each deal is making you Like say 10 deals 100 grand into each deal and each deal is making you $15,000 a year They don't see that value because they're like, well, I can do I can take that million and buy four properties And you know, I mean I can make that money in 10 times. Yeah, they don't see a value of like Oh, I'm making 15 grand per deal. That's 10 deals. You know what I'm saying? That's 150,000 or 250,000 or whatever. What's the number? You're a math guy. You lost me to be honest. 10 deals, 15,000 each. 10 deals, 15K. Yeah, 150. That's about $150,000 a year, right? Yeah. So $150,000 a year doing nothing. But they don't see it that way. They see it as, well, I can go buy two properties for the same cost and make that $150,000 times two. I can do $250,000 within six months. Why would I give you the money? I'm not looking for those guys because they don't see the long-term play. You're doing nothing. You just have to collect the check every quarter and get quarterly reports. Right? Right?
Well, like, we're not really, like, there's some centimillionaires in Ottawa. Like, there's this guy, man, at the Bible study. Like, they know a bunch of, there's a centimillionaires here. There's some, I just don't, like, there are a lot, like, I feel like Ottawa is not the place, man. It's not. I don't have to limit it. It's not.
Ottawa's home base because I like, there's not much to do here. Like, we're the age, we're done partying. We're looking to start families in whatever situation we may be. is a great place to feel and start a family and build you know good community with good people here but if you're looking to hustle it's not it you have to like you have to like mentally be in your head hustling and like you said traveling so for me I want to be by coastal I want to be in
Ottawa only half the year and the other half I'm in florida you sound exactly like me like this you sound exactly yeah I don't that's why I reached out to you yeah it's like I could tell I listened to you talk for the I listened to him talk for like five seconds and I knew that this guy was like perfect for this podcast yeah similar I only want to be in auto half the year and that's
Only in the summer but like I want to be in florida like and a lot of people don't know but I'm working on deals in africa oh yeah tell me about that so tell me about that's like a whole nother thing
That I really don't understand yeah africa's a different beast bro everyone's scamming
I mean you said it not me so I'm telling you so one of my good friends he just moved I went to I met him at St. Mary's university I'll say the best thing about university is building connections yeah It's the biggest networking event you can go to in your life That's why I'm in business university It's the biggest networking event you can go to in your life So that's out the way His dad was one of the directors At the central bank government official his whole life And he decided to move back home To start building relationships He's Canadian, got his passport, everything is good If he ever wants to come back, he could But the business connections he has made In Africa And he's in Ghana And he met someone And I would love to eventually raise capital to start building there because I do understand the construction game. He met someone who actually lived in Calgary and was actually building, doing new builds in Calgary. I spoke to this guy on the phone. After a conversation, I'm like, I have to find a way to invest with this guy because he went from, he was like, the margins here are pretty decent, 35% if you're building a new home, a custom home, of course. He went to Africa, his margins are 200%. Jesus. He's putting 100 grand in, selling it for 350, 400 USD. Like that's buying the land and going, sorry, that's not including buying the land, but that's labor costs, material costs. He gets all his materials, high-end materials from Turkey. Interesting. Turkey is better than China, he says. Really? I'm telling you what he's telling me, right? Yeah, really, yeah. Higher-end materials come from Turkey. He gets all his materials from Turkey, the finishing, not the building materials. Yeah. Kitchens, the bathrooms, everything comes from Turkey, Turkish tiles, Turkish flooring, Turkish cabinets. He buys everything from Turkey. He only sells to expats.
Okay, so it's nice places, I guess.
All custom-built. Okay. And while some of his properties are built before they go up. Are these multi-families? No. Single family homes. He only sells to expats. Okay. So he's not selling multi-families. He's selling custom homes to expats. Oh. So he's not building them for them. He's building them for... People that are leaving North America. Yeah. And there's a lot of them in Ghana right now. Okay. Who is becoming bi-coastal like we're trying to be? Yeah, yeah. So they're there during the winter times and they're back here during the summer times, right? Yeah. Yeah. And by the way, that's like... That's a new trend. What you just said...
Well, because the thing is, this is the first age where so many things are happening where people can be minimalist and also rich at the same time and then people can also be um digital and just have online businesses and then just be everywhere at the same time or you know even if you have brick and motor you can manage them remotely yeah right like I know guys that they have like like one guy I met in the gym uh connor a nice guy um he had a bunch he has a bunch of airbnbs around the coast whatever and then he just a bunch of vas in the philippines that manage yeah I mean why hire expensive airbnb company in canada where you can get vas to get all the job done yeah legit yeah so now soon soon
It'll be ai too yeah so this guy in ghana he he's um he's building like his problem is cash flow yeah right it's not that he can't find the properties doesn't have them it doesn't have enough money to put into each so for him it's like he started off with one they went from one to like three then three to five but like he can only do so much before cash flow is constrained right yeah so I would love to like buy because EYL earn your leisure they they own property in ghana
As well oh yeah they're building multi-family see you know what man tangent about ghana you know what man so I used to work so before this whole raise all company I used to work for um you know you heard of exempt market dealers exempt market dealers yes yeah so I used to work for one well I've been trying to get a hold of like I've been talking to those guys man it's again so hard to raise capital I mean happy I met you man it's hard it's hard there's one guy that's good I'll tell I'll tell you, my phone's you here, but I'll give you the guy's name. He's nice. See, he's good. So he doesn't charge up front unless the deal, well, if the deal's garbage, he would charge up front. But he doesn't charge up front if the deal's really good. And then what he does is he has a bunch of sales reps. You can build your own partnership or white label thing. He has a bunch of things where you can get a bunch of sales reps underneath your deal, and then they can sell. And then you just see how it goes, whatever. So there are a few guys that are like that. I know one guy that's like that. This world is all new to us.
Because for us, we bootstrapped our first deal. Yeah, yeah. It was bootstrapped. Our first deal was fully bootstrapped. So it was family and friends and the BDC. And I was stressing because I wanted to get this deal done. And so I actually got advice from one of my friend's dads because when I was looking to raise capital to get this deal done, a lot of people I talked to thought I was just looking for money. I was like, well, no, I'm looking for advice. And when I told them that, they opened up. But when people think you're trying to get money from them to buy a company that they know nothing about, no, I just need some advice. Like point me towards the right direction. And he did. He told me like, have you thought about the BDC? Because first we tried the banks. They treat us like kids, bro. Yeah They treat us like we like hey honey Like are you sure this is good for you Yeah limiting beliefs Yeah like I mean they tellers Very risk management very highly like, I mean, to make 21 an hour, like, they don't really have the mindset. They treat us like kids. Yeah. It was just really annoying dealing with business brokers at the banks, the big five banks. I'm not going to name who. Yeah. And then when we, shout out to Kevin at the BDC. Oh, yeah? Yeah, Kevin, Kevin Price. Shout out to Kevin Price at the BDC. Hi, Kevin Price. Yeah, He just got a promotion, so we're not friends right now. Oh, okay. Because he's no longer our account manager. Great for him, bad for us. He's too good. Basically. He believed in us. He believed in the deal. He helped us get it done. He walked us through the process. And he didn't treat us like kids.
What was the stack in the structure? It was like, what, like 80% and then 20% down?
No, we put only 15% down. 15% down and then you put in the other like 85%. Yeah, the bank covered the rest. And like, bro, it was like a movie. Like, we called into why it went through. like that.
How long did it take for it to happen?
The wire? No, for the whole deal from start to finish. This was a fast deal. We got it done in 118 days. Okay. Okay. From like, from the time I met him to the time the deal was done. 118. Yeah. That's fast. Okay. Yeah, that is fast. Usually it's like, usually, yeah. I met him in September. Like, it's closed. We signed January 6th.
How much, how much, what's the total if he can disclose?
I can't disclose. Okay, that's okay. I have my contract. Oh, okay. Okay.
Okay. Congratulations. Thank you. Yeah, when did this happen?
January last year. Congratulations. 2025. January 2025, yeah. That's good. That's good.
Yeah, I'm telling you, you're on to some huge stuff, man. That's really, really exciting, man. That's really exciting.
I mean, we're finding more deals, and we're confident. And one of the things I learned dealing with guys like you is that you have to have a good team. Yeah. Like when you're packaging these deals and bringing it to investors, you have to have a team. They want to know who's managing their money. Yeah. Yeah, I mean, well, I mean, who's running the business, you mean? who's running a business who's managing their money it's not about who's running the business their money coming to you who's managing it yeah what are you doing right because they want to know what skill sets you have yeah and qualifications you have to buy this business it's or are you gonna have someone in place to run this business man you know what man this is so interesting
Because so like you know what man I've gotten to the point so my head just wants to explode sometimes because like there's just too much to do right so I find that my bottleneck my business was so I went to this conference in uh miami it was seven figure agency uh there was one guy daryl uh he's like yeah hire local for customer facing people like you know I hired I hired uh Tre and then he's closing the deal I'm not raising the money it's him that's raising the money so your business partner trade you brought him on as a business partner or as um he's easy you brought him as an equity partner or you hired him as a he's um so it's like it's like kind of like, so on equity, so we're doing a few things. You don't have to disclose it. I'll disclose, I'll disclose. I don't have anything to hide. But basically, it's like VP of Capital Markets, so it's kind of like an employee situation. Except, you know, one thing is that people, at a certain point, it makes more sense to just have like a personal corporation. So that's how that's structured. And then what we're doing is that we have this advisory fee, these advisory fees on that we charge as well, where we create people's roll-ups and then we have stake in those funds, in those roll-ups, right? And then we give them some share of those equities too. Because it's a good way to become, you can become a paper millionaire pretty quickly. If there's a $14 million deal and you charge 8%, you can become a paper millionaire when that deal is closed. And then maybe you wouldn't become a cash millionaire, but a few hundred grand isn't that bad. like you know so it's just that it takes a while and the thing is man it's like I think as long as like I have we have like you know maybe like like literally just eight like in a year and then even just half of them closed and like we're good like I hate to sound unambitious but like that's you don't really need that much you know it's it's like yeah if you're doing like 10 50 million dollar eight of those deals that's a couple hundred that's that's a couple hundred or even worst case you do too like you're not you're not going to be homeless on the street like you'll be
Okay I'm too ambitious for that bro like so my goal is to close so our goal my goal one of my goals is do 10 million dollars in revenue yeah in two years yeah one of my goals it's very doable very revenue through ownership of ownership to ownership you can do that that's very doable right you can do that so right now we're we're we're basically 20 there don't forget me when you get big you you're coming on right what are you talking about you're coming along it's not don't forget me when you get big it's like like I want to build a team I want to build good people around me yeah Because I want to motivate everyone around me and build good relationships around me. And on top of that, I'm not just buying business for myself. I have mentees.
Yeah. People that want to do what I do. Tell me about this mentee thing. I saw one. She was a nice lady. What do you have going on?
So I was looking to give back because we're in a spot where my schedule is very open. Yeah. We're only working two hours a day on the business. Because the business, it runs itself realistically. We just do the small tweaking maintenance. If it was a car, we're just doing the oil changes from time to time, right? So we're not really in the office for very long. And it's free breakfast every morning because it's a cafeteria that we own. So it's great. We own two Starbuckses and multiple location cafeterias. Nice. So it works out very well. And our contract is not with Starbucks. It's with Nestle. Oh, yeah. You see the Starbucks and hotels and stuff? Yeah, yeah, yeah. Those contracts are through Nestle. Interesting. So those are very great deals to have because we have that relationship. Yeah. Any business I buy, I can throw one of those into one of my other businesses. Okay.
Okay, so just break it down because I'm not in this whole world. So you own buildings that own Starbucks?
No, I don't own the building. So I have a government contract. Okay. So in Tunney's Pasture, I own locations in every one of those buildings. Okay. In Tunney's, right? So the previous owners got a deal with Nestle that they're able to use the Starbucks logo within that building only. Yeah. Right? So they can use the logo, image, likeness, whatever. They can't sell on Uber Eats or anything like that. They only can sell within that building. that really helps revenue because a lot of people like Starbucks especially when it comes to pumpkin spice season like right now Yeah exactly Exactly We running out I not even joking Like the Uggs you know Exactly So we have two of those locations right In Tunney's. And then we have cafeterias. Yeah. So the cafeterias feed the government. And we're only open seven to two. Yeah. But the cash flow is insane. So you own these locations.
So the locations is what you purchased. And the contracts and the locations. Yeah.
So our contract was with PSPC.
PSPC, what's PSPC?
It's the government body that gives our contracts to private companies. Interesting. Yeah. So we're under the RA, and the PSPC...
What's RA?
RA is who manages all food throughout Canada.
Got it, got it.
So it's a crown corporation that manages the food services for all government buildings throughout Canada.
He's dropping game for everybody. I didn't know any of this stuff.
I mean, honestly, I didn't know. I had to learn all this. I learned Sysco, which is one of the biggest suppliers of food in North America. So S-Y-S-C-O. Yeah. Sysco, if you buy their stock. Oh, yeah? I walk the facility here. Not financial advice. No, no. Not financial advice, but I would, like, Sysco is not a food company. It's a logistics business. Yeah? It's like, it's the Amazon of food. That's how I'd describe it. It's the Amazon of food.
I feel like all these B2B things, like, nobody talks about it. Nobody talks about it.
Yeah. Think about it like this, right? You need a RAM and a motherboard to run your computer. Nobody talks about that. Yeah. Talk about how much memory your computer has. Nobody talk about the things that actually runs the computer or runs the vehicle, right? They just want how much horsepower it is. They don't care about the hoses that it takes or the computer power that it takes to make sure the RPMs are right. They just care about how much horsepower it is. Or like the company in Taiwan that they've got the thing and the cobalts. Exactly. They don't care about that, right? Yeah. But the supply chain is where the money's at. It's where the money's at. Because for those things, like, the guy who owns the Jacksonville Jaguars, the Indian guy, don't know his name, but his company, all he does is make car parts. It's like bumpers and hinges, like, for the big three. That's all he does. And he became a billionaire doing that. That's crazy. Nobody talks about that, right? So, buy Sysco. Leave it at that. Like, I went, it was like six, it was like eight football fields, man. It was huge. and there's like they have 30 000 screens of every food that you can look at and then they
Just organizing everything it's insane it's insane the heck they do I don't I just see their trucks
On the highway so Sysco, so they only sell to businesses yeah they only do b2b and they wholesale food right so what they do is you open an account with them and you order food through them and they're very like on point like their their delivery service is like clockwork yeah and And we took a tour of the warehouse. And so if you're starting a restaurant, they have like a sample kitchen where you can go out and they can build your menu for you. Like they have a full service. They build your menu for you. They write down all the recipes and all the materials you need. They can ship it to your kitchen. And they are, I think they, don't quote me on this, but they are about 80% of like restaurant foods, like servicing all restaurants throughout all of North America, about 80%. They have a full monopoly on maybe 60%, but it's a full monopoly on B2B to restaurants.
I know that Nestle is the biggest food and beverage company. What does Nestle have to do with this?
So Nestle, they have a contract with Starbucks. Yeah. And we're able to use Starbucks. We buy everything through Nestle. Nestle buys it through Starbucks. So they make their markups that way. Got it. And we buy everything. They're like a broker. Yeah. We also have a deal with Van Houtte Coffee. Yeah. So everything in our – as long as you keep buying coffee from them, all the equipment they give us for free.
But it's kind of weird in a way because it's like you bought out a government contract. Yeah. Is this what you purchased?
I purchased a government contract. So I didn't know you could – like I guess you could, but I never – this is not something I really – I didn't think so either. How does that work? So the government contract, the family owned this since 1949. The hell they did. Yeah. They're third generation. They're in Tunney's Pasture since 1949. When Tony went up, when it was just cornfields or whatever it was, they were there. They were the first family there. So we bought an 80-year-old business.
So now you're going to be like the new oligarchs.
Basically. Like you made it.
Yeah, basically. Multi-generational wealth.
Multi-generational wealth, yeah. It's like the kids didn't want it, just like you hear that story a lot. The kids don't want it, we purchased it. But that's actually what happened. They didn't want it. The kids didn't want it. And we purchased it. How did you find it for sale? Crazy story.
No.
I was buying a couch. Oh, gosh. Yeah, this is a story. Tell this one. So I was buying a couch for my sister, and then I was actually looking to go stateside. Jesus. I was looking at a company stateside. Yeah. I just didn't know how to raise 50K at the time. Small penis to me now. Yeah. But back then, it was like, how do I get up with 50? I didn't need the down payment to get to the broker so I can go through the SBA loan process. I didn't know how to do that. I had no idea how to do that, right? Sounds crazy now. Thinking about it now, I'm like, this is so much easier. I can do that in my sleep now, right? But 18 months ago, no idea That's crazy About two and a half years ago Two and a half years ago, I had no idea So I told him I was looking to raise money I raised money to buy This business stateside We're looking at it, blah blah blah And we just started talking about business Because he was like, have you thought about the food business? So I'm like, nah
That's the seller of the couch?
Yeah, I was buying from his house I was like, no, I have to deal with all the Habibis And all the Sharama shops and it just sounds very stressful and like food waste and fridges breaking. He was like, no, no, no, there's no competition. I'm like, what do you mean? Like, this is auto. Like, there's nothing about food restaurants here anyway. He was like, there's no competition here. It's just one of those situations where he's like, just come see it as a government. Like, he basically wanted me to see it so bad. So me and my business partner, at the time, he was handling my books for my construction company. And he told me, he was like, we'll just go see it. I was like, whatever. There's no expectations. my jaw dropped. This was a whole operation. This opened my eyes. Before I bought this business, I was doing multiple six figures a year Depending on the year anywhere from four to five or four to six in revenue not EBITDA And then once you go to like the multimillion dollar businesses a year brother it a different ballgame Like accounting, bookkeeping, like the emails are more like the money's watched like to the penny. Like while I was doing contract, I put money out when I wanted. Yeah, yeah, yeah. It's just very contract vibes, right? Do some cash jobs, write it off as a loss. Allegedly, of course. You already listened, but allegedly, of course. But when you buy a business with that much history and that much structure, it really opened my eyes to how I, pardon my language, where I fucked up. If I structure my construction business the same way that business is structured, my construction business would be a $10 million business today. But you don't know what you know, right?
Well, what did they do exactly? They were just more meticulous and system-like?
Well, it's a government contract, so everything is watched. Yeah. Because, so, I can't speak too much on the contract, but the government has, so one of the agreements of the contract, the government can come and look at your books at any given time. Yeah. And you need to have a CPA on file to be able to cross-reference everything that's done properly.
Oh, it sounds like one of those, you know those grants or whatever, those like, not like the grants grants where they just give you money. I don't even know if that exists, but like, you know those kind of semi-grant things where like they- Half grant, half loan type thing? Yeah, where they're like, okay, give your liver and kidney and your intestine and then open it so that we can see it.
Yeah, basically. Okay. Yeah, so it was one of those. And then so you tend to make sure like, because it is a government contract. Everything is above board. Yeah. There's no corners like me cut. There's none of that. There's none of that. So like watching the way and how we had to fit into the business, I'm more on the operational side. So I did a lot of the hiring, the firing, and dealing with the different personalities of the staff and seeing where their strengths and weaknesses are to make sure everyone's in the right position to win at all times, right? And my business partner handled more of the back end, which is the finance, the ordering, cutting food costs, finding the same items. Don't lose quality, but find cheaper items, right? And we really did a good job at that, especially when food costs are going up and fuel's going up, right?
You can't throw any numbers about some sexy numbers like, oh, is this a million? You can't throw any?
We're doing well over seven figures a year there we go off camera we can talk about it on camera I can't it's sensitive stuff like if it wasn't a government contract I would yeah but you don't want to piss off the G-man bro no no the little G yeah you don't want to piss them off right yeah and so yeah it's just because of the nature of the contract and the buildings that we work in yeah everybody's contract because we're not the only operators yeah so we're going to be operators like we're taking think of us as franchise owners We're not the only ones And there's other operators out there And we don't want to disclose what our contract is Because not everyone's contract is the same So you don't want to disclose that Because you can lose the contract Because now you're creating an opera And riots and whatever situation So we can't disclose too much on here Because of the nature of the contract That makes sense But it's definitely well over 7 figures a year That we do in revenue The food business is tight The margins are tight 10-14% margins or 15% margins but it's consistent and as long as people come into work it's consistent and we got lucky we got very lucky with the business very lucky
Yeah but I mean luck is when an opportunity means luck you're ready some people they have that they have the opportunity and then just oh thank you for the couch you actually made something out of it
Yeah like I took time on my day to go see a company and I was like whatever this guy's hassling me It could be opportunity, it could not be opportunity, right?
Okay, that guy gets commission or no?
We sold it to him. It was him. It was his business. Oh, damn. Yeah, so we sold it. So he was the one I was selling. And the reason, shout out to him. He didn't want to go with a broker. One, he's really cheap. Shout out to him for being a cheap person. He didn't want a broker. So he did approach a broker. He was like, why the fuck would I give him 10% for a job I can do myself? All he's doing is putting it online. He wasn't wrong.
I feel like the couch was really just a distraction. It was really just like.
I mean, the universe aligned it that way, man. Yeah, that's crazy.
But, well, I mean, if there's one thing, I don't want to make the podcast about this, but brokers are basically. You know, I think we're making it by brokers. Yeah.
I mean, the further you go away from brokers, the more money you make. You notice that? Yeah. Yeah. Way more. You make way more money when you leave brokers and you start focusing on directly to the owner because you can negotiate properly. Yeah. You can outline a proper plan of outlining. You can tell them, take it to your accountant. Yeah. Because if you structure a proper buy, let's say you're buying, let's say, round number, a million dollar business. Yeah. 30% of that is VTB. Yeah. You're basically making an interest on your money. Yeah. And then I can pay you out in seven years. And then you get a big balloon payments. In seven years. Yeah. And you still walk away with $700,000 in your pocket today. Yeah. And the deal actually gets done. Because there's also the opportunity cost, again. Because some people, they'll be like, oh, whatever. It'll be on that website for two years. And then in that time, you still have the business that you're running. Yeah. Right? And then you have to keep it clean. Well, I'm not saying that it ever gets dirty, but you have to keep the CPA on call to keep it clean. Because once you're preparing for sale, you don't want the value of the business to drop. That's one thing you don't want to do. So you're preparing to sell the business. One thing you don't want to do, especially if it's sitting a long time, you want to see consistent growth across. And for the business I look for, I don't really look for growth. I'm okay with stagnant. But as long as you're doing 15% to 20% in EBITDA a year and it's stagnant, I can work with that. because a lot of these businesses that we were finding they're very old school they don't have proper CRMs they don't have proper SaaS software to help run the back end and sometimes the sales guys are really shitty
Oh yeah well yeah let's talk about this AI thing I'm very very very much a maximalist you know like I really am a maximalist some people say I believe in it too much but what are you seeing I'll share it, let's go back and forth because I have some things I'm working on What are you seeing with the whole AI revolution?
So the AI revolution I see in a especially in the trades and the manufacturing industry is It's easy It eases up accounting, for one. It's easier. You can do accounting a lot faster. Yeah. It funnels. A lot of stuff can be done manually. Yeah. So your accounting team is like, except for having five people, you can bring down on a two, right? When it comes to, for us, food costs. When it comes to comparing costs, because we can just have Claude run on the back end to compare costs from three months ago to now, and it will tell us how much money we're spending. So where we can bring money down, all that stuff keep tracks of all that right so for us ai is a like is a tool to enhance or make our lives easier but it's not something I would heavily depend on because especially in the in the industries we're looking at a lot of critical thinking comes into it right yeah that's the issue yeah it's a situation for let's just say um a manufacturing company right um you implement ai and you think oh well if we cut xyz xyz xyz we can streamline the business make 80 more well you No, no, this person is giving you wood at below market value because he has a 10-year relationship with you. If you cut him out, you pay market price now. This person is the backbone of the warehouse. If you cut him out, a lot of guys aren't going to fall in line. Even though we're paying him, he's not doing much, but he knows where everything is, and he's the backbone of the warehouse. He knows where everything is. He knows the delivery structure. But if you say AI can streamline his job, well, when something goes wrong or the software is down, we're scrambling, right? So you still have to use your critical thinking skills before you start cutting jobs or cutting different people in different fields within that business, right, or try to streamline it. I say enhance it, teach them the AI so their jobs are easier, but don't completely think their jobs are useless because a lot of the critical thinking skills AI can't do yet.
Yeah well I mean there's so much like I agree with you like I agree with you like 95 there's so much like nuance though and there's so much so because like basically man like it's so weird so you have this business that you're operating right like and then because like we're only on the fun side so we're kind of like abstract we're kind of away from all the action yeah and we're just like moving the money side action is action bro like it's a contact sport yeah so like like do you get get into it like I mean I mean I don't want to get into it I think I should just stay in my lane like I should let the operators operate and then I'll be like a finance bro um you know I'm looking for a man in finance I thought that meme died by now man but like I'm telling you this ai thing like okay I'll tell you a few things so you know you know the crms like the the baby crm because like when you go into seven figure contracts and stuff like you're a big you're a big man yeah yeah you're a big man that's good but like a baby sir once you go to like the 15 20 30 million dollars like that's the in-house built crms like yeah those are different some of those guys are scamming them though like sometimes like they hire some firm that scams like this is real sometimes like especially now if the the cost of labor should be way going down if the ai but anyway I mean just on the on our like we have this uh so you know goi level close.com I don't know if you know this basic uh like hubspot whatever so we made our own like we just coded our own like vibe put our own man and then and then that's it yeah and then we got it ready like we hired a um adept to just take a look at it to make sure like hey there's no bugs yeah there's no bugs and yeah there's no back end people can sell data and stuff like that yeah yeah and then that's it and then because like we use twilio twilio the api to connect the calls and then we connect the emails and then we have a crm like there's no magic and then the thing is we connect the ai to it and then it can just like take care of everything it can read everything it can so it's like hey you know we want to send a text to this client or whatever. But then the issue is that we have to intermediate it because we can't just let it do anything by itself. We have to, like, basically when we wake up to, we see a bunch of draft emails and draft texts, and then we have to, like, approve everything, and then it gets sent out, like, a scheduled, blah, blah, blah. So that's basically what we do.
No, that works, though, because, again, what if there's a bug? What if there's a software glitch? Now you're sending out crazy texts to crazy people. Yeah. Like, it's like, whoa, like, you're burning a lot of bridges because of AI. Now you're sending out a bunch of apology. messages. Yeah, it ruins our reputation if we do that. Exactly, so it's better that you are taking the time, like, yes it's structuring and it's writing it for you, and all you have to do is read. Yeah. Don't have to take the time to write out each and every one, right? So, it's meant to enhance, like, I think of like I think of like AI as like dipping sauce, you know? Like you have like chicken wings or whatever, like a little ranch dressing, you know? If you want it. That's what it is. I don't think like, and a lot of people are bullish on it and they're pouring a lot of money into it, but when people are chasing trends, I don't chase it.
Yeah, it's actually sketchy.
But I like going into, so remember how you talked about what people are hyped about? Yeah. I like going into a really old and boring industry and then just adding a little bit of it. That's what it is. Adding a little bit of spice. Yeah, to like a boring, dry, lame. Like, again, there was a company that we're looking at here. Like, they're still doing receipts by hand. Jeez. That should tell you.
You know that's bad for you, right? You know the plastic from the receipts can go into, you know there's a lot of estrogen. They're old people, yeah.
They're still doing receipts by hand but the company is a 33 year old business it's like RH it was founded in 93 and they ran for many years and he has great relationships with a lot of different people and he still files cabinets there's no CRM to sign up as a contract or whatever the situation is everything was done by hand
But I feel like this is chaos theory because I feel like they made really good decisions 30 years ago and they're just benefiting off of good decisions and they're still doing what they're doing So I don't really – I think that they were smart 30 years ago, 20 years ago, and then they still be smart by doing what they're doing.
That's what it is. It's a situation where it's like they only know what they know. They're comfortable with what they're doing. They're not looking to evolve or make things cheaper or whatever it may be. Yeah. Like it's like you.
Like imagine you in like 30, 40 years. Like let's say you become a private equity like Black Ray Dalio, let's say. No, let's not. It's to make it happen. Okay. Well, okay. When you become a – There you go. Yeah. It's got to change the mindset, bro. Well, actually, on a serious note, you actually will. Like I can actually see it happening really easily. So I don't think it's that deep. I think you're basically, you're doing it now. So that being said let say you know you grow your AOM you in a billions or whatever You know I don want to say cents and millions Let say inflation Let say billions And then you have like an old way of doing deals You're like, oh, I want to meet people in person and I want to go on phone calls. And let's say by then, everybody's using Neuralink or whatever or they're putting chips in their brain and they're doing wireless, whatever, whatever future thing to do. That's probably what's going to happen. Or meeting in the meadow there, so whatever. Yeah, exactly. People will be like, man, this guy can do way more deals if he just like puts on the AI chip in his brain, you know, but like, ah, I'm an old school guy back in 2024 or whatever. This is how I used to do it.
It's a situation you can't read their emotions, right? Because like they can probably quote all that out, you know, there, like I want to see, I want to see your face. Yeah. Legit. And then you're, you're African, correct? Like you're from. Yeah. So half Nigerian, half Liberian.
Okay.
So like our culture is very similar in a way where it's like our culture is, if you can't, if someone can't look at me in the eyes and talk to you, I can't trust you. Really?
But I thought So I don't know Like I thought that was rude in
No in Haiti If you're doing business With someone Okay Or you're talking to someone If you're talking to someone In serious conversation Okay If they can't look at you In the eye They can't be trusted Really Yeah
I thought that that was like a Like I can't remember Whether it's like rude In some African
It's only rude If you're a child And adults are talking And you're around It's like yo You gotta But if We're talking business Like yes And I'm talking to you And you're doing all this stuff And all this stuff Yeah What's wrong with this guy? Yay. Is he tweaking? Or is he trying to stab me? If we can't look at each other like we're doing now, are we actually having a dull conversation? We can't be trusted.
And you can tell, like, I mean, bro, even us, I think at the beginning of the podcast, we're kind of stiff and then now we loosened out.
Even if he does these small things, it goes into our Olympic system.
It's really hard to build trust on the incident, man, because it's like... It's easy to fake it. It's easy to fake it. And I was in a situation where some guys that do deals, we have to show them so much proof. Proof, proof, proof. So what I'm starting to do now, we're starting to do this. When we close a deal, we just fly out to the guy, record everything. The way that we're doing it now, we'll just record everything. And then that's the easiest way we're seeing. Because if not, we have to start doing – we'll do more physical events. We're going to start doing more physical events, like conferences, stuff like that. Hell, we should probably go to one together one day. Who knows? Just like a business buyer conference, but not the one that I'm going to call out now, but not the one that you went to, maybe like a better one, whatever. Yeah, but you know what I'm trying to say.
Maybe just do your own, honestly. I feel like at this point, you could just do your own.
I could, but it's so much more.
I don't know if you saw on my Instagram. We did a massive back-to-school drive.
Oh, you did? Michele Heights. Okay, I wasn't aware.
So we did a back-to-school drive, Michele Heights, because I really wanted to get back to the community. I'm not even from Ottawa. We did a massive back-to-school drive, and I want to do that every year. Yeah. I don't really – and we've seen the work that it took to get that done. And I always – shout out to the team. Shout out to Bits. Shout out to everyone. Shout out to everyone who was involved. Taylor, like, who really took lead. Everyone who was involved in that because there's no way I could have got this done. The permits. We got everything done in four weeks. in four weeks, right? So, like, I really want to give back to community in that aspect. That's why I do a lot. So I do volunteering for a non-for-profit called Business in the Streets, and they do business coaching. So they help entrepreneurs who are under 34 who are making less than $50,000 a year. That's a qualification to get involved in the program. And we help them either start a business or grow their business, right? And we're very successful. I say I've been doing it for a year now, and I still have a lot of students I still talk to. And a lot of them are taking different paths in life, but the lessons that they learned, they're taking it with them. Really? Some of them are expanding and growing even bigger. This one really touched my heart in a way, because last, in the spring session, I had someone who was there. In this session, I have her husband. Because she came back and her husband was like, you're a completely different person. Who taught you all this? When I first met her, she was thinking small. So what she does is she buys, her father-in-law owns a farm in Nigeria, and she buys honey from him. And I'm like, and she'll sell it for a very low price. And I'm like, people are willing to pay premium to taste home. Like, why?
It's true. I like the way you phrased it. Yeah.
People are willing to pay a premium to taste what home, like, those memories come back. They flood in, right? Yeah. And realistically, honey here is not the same as honey back in Nigeria. It's not the same stuff. So, and she was scared. She was hesitant at first. now she's looking to raise the prices by xyz and really scale up the business before she saw it as just a hobby okay and now it's she's seeing as legit business her husband was like I need to talk to this person because like you you didn't think like this six months ago like what's going on yeah it's like the minus touch for your brain for her brain and I really like and I enjoy that because I'm able to help someone else grow there and he's in construction which is my my bread and butter yeah I already gave him a shit ton of connections that he can use already um and I really really like that's what I want to continue doing and for me to continue doing I have to continue to grow and so I can't stay stagnant I want to get to like that 10 15 I know I'm gonna get to a point where I can't help the small business owner anymore because I can't relate yeah but I can help that person who's trying to make their first that that's doing half a million that's trying to break into a million or who's doing a million that's trying to break to 10 because that's the sweet spot I want to be at right when you get into advisory or like okay
So coaching and advisory are interesting words. Would you ever get into like, you know, coaching and courses and coaching or would you be more like an advisor?
I don't want to get into courses because I don't want to be labeled as a course seller. Okay. I want more to do with the advisory part.
What's wrong with a course seller? We don't sell courses anymore, but what's wrong with a course seller?
A lot of them are scams, bro. Yeah, it's true. And a lot of the time, like, especially in business, information should be updated yearly. The courses need to be updated. And then there's AI now. Exactly. The core course makes sense because the core information is all the core information. but compliance changes every year. Yeah. And the courses, a lot of these courses are out of date and they're still selling it three, four years down the line. I think agencies or, I think a service, like an actual service is actually where it at I prefer to do the business coaching one on one I want to charge for that eventually Yeah And I still want to give free spots Of course I want to get to a space where I doing let say tens or hundreds of millions of dollars I charging people business coaching but I want to be able to leave two free spots available for someone who can't afford me but are in need or at that position where they might be losing money. They might be doing a million or two a year or whatever it should be, but they're losing a bit of money. And except for them spending the last dollar on me, I can help them for free. it's a way of giving back and I would like to do that that's where I like to be but you're already kind of doing you have mentees right now yeah I'm doing it for free I'm working through a charity but once I get through a certain level I won't be able to help these people anymore because the altitude I'm at is way too heavy compared to where they are
You know what sucks is like when I was young I wish I knew so when I was like let's say from 16 to 21 I wish I knew people that were like you because we just had these generic kind of like so so do I yeah yeah we have to figure out legit and this and you know what sucks it's like our age our age I kind of feel kind of not to be self-pity but like I feel like our age we're kind of in this spot where like we didn't have like the iman gazis or the all these people whatever we there are less gurus yeah so like I feel like people now like 19 year olds are legit really smart because there are all these people that came before them that are putting everything
On the internet yeah but like um I think there's levels to it right like there's you like you're making this and then there's like a 15 year old watching this and I hope he can reach out but I don't do any minors I don't do anyone under 18 because it's not it's this situation where um I'm I'm harsh like I'm hard because it's a situation where it's like life is going to throw you punches either you dodge it you're taking the face and keep moving and kids are very sensitive yeah so I don't want to deal with the parents and the nonsense why were you mean to my kid today because you told him to do something he didn't do it I'm like well life is not gonna be like if you don't pay your bills tomorrow mam or your mortgage what happens it's true like what how come I got treated differently because he's he's like he's 15 or 16 so I deal with people like a bit more mature like 21 22 even then like my mentee that's here like she's going out with her friends or whatever it's friday night like I expected and the fact that she showed up here
Was amazing yeah yeah oh she's already in the top like the standards are not really that high for a 21-year-old.
It's a situation. I always tell her, and it's my motto, protect the brand. I learned it from Shaq. Shaq said, people ask Shaq, how come you don't drink in public? He was like, oh, how come you don't drink? He was like, I ain't tired of drinking. I just don't drink in public. I am my brand. If I get too drunk and I do something stupid, I could ruin millions of dollars for myself. He is very high leverage. He is really the brand of so many, he's worth so much money. You're the brand. LeBron, look at LeBron. He's the brand. You don't hear LeBron getting nobody pregnant. No. I'll just say, like, you don't hear none of those stories, right? Because, like, you don't hear Steph Curry's story. You don't hear the crazy thing about Steph Curry. Oh, Steph Curry got caught in a locker room, whatever situation may be. Because they understand that they are their brand. It's kind of congruence.
Like, you know what's weird? It's like Charles Barkley was really honest about him, like, being a womanizer and whatever. But then the moments where when Tiger Woods got caught in that affair and then the woman bashes his car up a golf club, you know, then that ruined a lot of his deals. Yeah. Because it's incongruence to who he is. Even though it has nothing to do with the way he performed on the field. No, yeah. But because you're no longer marketable. Yeah, yeah, yeah.
And I have to understand that if I'm building a reputation, especially because I find that, I don't know if you see the same thing in entrepreneurship, but when I'm doing a lot of business coaching now, I find that 80% to 90% of the people I'm helping are all women now. Oh, yeah, really? Mostly women. Yo, men are lazy, bro. I don't know, bro. You know what? Wait, let's see. If you think about it now, I'm not even joking. I was so shocked to see that. I'm like, because I'm doing the business coaching through bits. And literally, I've been doing it for a year now. So I have that at a show behind us. 95% or 90% of people who joined the course are women.
You know what? Let's talk about this for a second. So my friend, Sarah Massadi, shout out to him if he watches this. He is this LinkedIn coach. And he travels and he goes to LinkedIn and whatever. So he teaches people how to make money with LinkedIn. And most of his clients are all women. And then they're really successful women. It's not weird. I think it's just a shift. Are you sure it's not? Because like me, I was like, he's very tapped into his EQ and all that stuff.
You have to look at it like this, right? Yeah. Women are the biggest consumers, right? Yeah, they are. Like. Thousand percent. They're the biggest consumers, right? But at the same time, if you're selling something, a man, his ego will be like, I can just figure it out myself. So courses, very few guys will actually join courses. But back to What I was telling you about Mentorship and other stuff I feel like there's levels When we're looking at stuff It was like Grant Cardone It was Alex Hormozi There was very few people in the space But those people were already making Multiple seven figures a year Realistically how much can you actually Look up to them Not just look up to them but how much can they actually help you Because Their problems are not the same as our problems Just like when I talk to some of my friends, right, like who have nine to five, they're complaining about, man, you know, I just had my winter tires are done this year. I spent like another $1,500 to replace them. And I had my brother, my payroll is like 60 grand a month. We don't have to. My overhead is like well over six figures. We don't have the same problems. You know, like I can't relate. You know, I can't relate. I can't wait for the weekend. Yeah. I can't wait My weekend never Like I have to work Like you know If someone comes tomorrow I can be in Toronto Because it could be opportunity You know like So That's what I mean Like their problems They can't relate To what we're Like smaller creators Or people who are just starting off So when they A lot of them do those Beginning courses It's very surface level So I don't want Like that's why I said Once I get to Like once I hit a certain level It'll be very hard for me To coach people Who are just starting a business Or trying to do their first six figures because I'm trying to get to my first 100 million and they're trying to get to their first 100,000. It true It just doesn make sense for me to There no value I can find myself helping them because now I have to go through my old playbook that's outdated to help them make $100,000 because I'm trying to make $100 million, right? So it's better to help someone who's doing $10 million to help them make $50 million than to help someone who's doing nothing to get them to $100,000. That's true. That's true. I kind of agree. So it's kind of...
I agree and then it's kind of like nuance because here's how I look at it. Do you know that book Principles by Ray Dalio? Yes. So that book changed my life because it made me think about how much I can believe somebody. So let's say I want to figure out how to run a government contract to business in Tunney's Pasture or whatever, that type of business, right? And then let's say I have zero experience. I've never done it before. There's relevance to what I'm doing. So in terms of how much money you're making, but also the relevance and the niche, because somebody can be a car salesman business owner. Somebody can be a jet pilot business owner. And then if the jet pilot business owner is a million times ahead, and then the other owner of the other business is only 10K ahead, I'll listen to the jet pilot business owner if I want to be a jet pilot business owner. You know what I'm saying?
So I get you, but I feel like that's the wrong way to look at it because it's a situation where it's like don't get me wrong a lot of people want to be in the same room as um Grant Cardone yeah or in the same room as to pay for one-on-one would be amazing but you're not there yet he's the guy's doing like hundreds of millions a year it's true if you're only doing a million a year find someone who's doing 10 and talk to him and pay him because one is cheaper and two you you can get to 10 a lot faster than you can get to hundreds of millions oh I think I get it I think after you get to the to like 90 of the value of the guy like who's just 10k above you then just go to the next guy exactly go to the next guy right so like if you're so my goal right now is to do 10 million dollars yeah in revenue across the board I'm not talking to people that's making hundreds of millions dollars I'm talking to people that's making 10 15 20 but I feel like you talk to them for strategy
But not tactics exactly so like what to actually do I would really listen to like ray dalio I'll
Listen to more like strategy and how to think exactly because the thing is like I feel like but not just sorry for cutting you off you're good it's not just strategies it's um it's relationships as well because once the way I view it because I'm viewing it right now yeah once you hit a certain number those old relationships they don't die out but they don't serve your purpose anymore because those new relationships are doing bigger numbers right so like for example if you know walmart or whatever right if if you're talking to um you know um let's just say loblos for example pretty decent company yeah not international like walmart yeah and now you're in walmart now you're in walmart you're still in loblos but like the relationship walmart is worth way more and now you can help someone get get those fears or whatever you're doing in loblos because you have those relationships already but it's not the same type of relationships you know there's levels to this right so um I find that if I'm talking if I'm if you're doing like one to 10 and then 20 10 to 25 or 50 it's very different brokers you're talking to very different people
Who can manage the money it's true it's it reminds me of hiring too like I feel like I can't hire the people that I was hiring like two years ago you can't I just like win backwards no because
Because they never had like then your business partner the guy you talked about he's doing he He knows how to do those type of big deals now, right? And, of course, he's going to be capped. He's going to hit a ceiling eventually. Yeah. And then there's going to be a situation where, A, he's either going to have to break that ceiling and learn. Yeah. I saw the anime, the reference, you know? Yeah. He's going to have to go Super Saiyan 3 or Super Saiyan God. Yeah, yeah. Or he's going to have to figure it out. Or he'll become like, what's the name of the guy, the animation, the guy who gets killed by freaking… Yamcha. Yeah, Yamcha. Yamcha post. We don't want him to be a Yamcha. We want him to be Goku. situation where you break your ceiling yeah and hit over 9 000 yeah yeah legit or you become or you become Yamcha or krillin and then no god forbid god forbid krillin or you have to replace him yeah because you're no longer doing the numbers he used to do yeah you're doing bigger numbers so now you have to find somebody who who is doing let's say 50 to 100 million yeah because
He's he's capped at 50 and people are coming to you who are who want 100 million dollar deals yeah but bro this like this is actually contagious because I'm telling you man like how much what do you think about the mindset stuff too because I think like sometimes like one thing where we we started to we started to crack a little bit is like getting better clients that have better deals that are bigger and easier to close because that's like another issue that
We struggle with I find like same thing in contracting the the clients who pay the late the lease gives you the biggest headaches so the smaller deal will be way more complicated and way more than it needs to be and they're pulling teeth because they're not trying to giving them a deposit. If someone's coming to you with a $15, $25, $30 million deal, here's $100,000, figure it out, call me when it's done. Legit, like that house, yeah. That's what it is. Legit, yeah. Because I know for a fact that if I give you $100,000 today, on the back end, I'm doing $5 million in EBITDA. Yeah. Figure it out. Don't call me. And if the deal doesn't close, just try again. Good job, buddy. You did good. Just try again. Or find somebody else. That's the difference between those type of deals. It's like the clients who pay the fewest amount, give you the biggest hey man this is my last dollar bro is the deal closed I have a family yeah I have a family don't worry I have empathy I'm just so do I no it's a situation when you're working bigger deals or like the 5, 10, 15 these guys understand how many works if I give you 20 grand and you give me the guarantee hey this is 83% close I risk that every day I risk that yeah it's literally
Yeah, it's literally like, it's expected value. It's like if you put like, let's say you pay 20k for something that has like a, you know, a 70% chance of making you 3 million bucks, you know, then you're paying really, it's like you're getting like 70k or 700k because, or a portion of that percentage of that percentage probability of the money. It's like you multiply the probability by the money. That's kind of like-
That's what it is. If someone tells me I have an 80% chance of buying a $10 million business and all I have to do is give them 20 grand, take my money. Yeah, legit. Take my money. I'll risk it. It is what it is.
Legit. But that being said, other caveat is there are some companies, people do make calls, people do talk to people. I do know some companies where they take 200, 100 grand and then they purposely try to not raise any money. I know there's this guy. No names. No, no, no, no, no. I don't want to get involved, but there's a guy, like a good buddy of mine in South Florida. He used to work for FBI and then hunt these companies down. That's what he does? Well, just for fun. Like, I feel like he was... That would be a great YouTube channel. Oh, I tell him, like, he owned the Jet Charter. Well, I guess shout out to Andrew. His name is Andrew. He owned the Jet Charter. Really good guy, you know. And then, but anyway, long story short, the issue of this whole finance thing is like, is like I feel like either it's extremely like good and predictable and there's a way or it's
Extremely like nebulous and like that's that's one of my one of my biggest hesitations too because the reason I'm trying to look for good business partners because like I don't have too much money out there because I'm doing a lot of deals like I prefer to build a team where you get equity within a deal and even we can structure it in a way where I'm not saying this is our structure but structure in a way where the situation was like okay you can get 10 of the deal and then we'll pay you out let's say you do 100k on the back end we'll pay that out within three years because we know the cash flow the business can handle that yeah that's a great structure yeah and a lot of people won't take that because if if you don't take that deal you're looking for a quick like you're looking to take my money and run yeah because that's a great structure one you're making money long term yeah and two you have upsell on the sell or I have to buy the equity from you so is that okay are you talking about like a guy from Blackcore Holdings like a guy that you hired to no so that be like if I looking to raise capital right okay if I looking to raise capital because we talking to some companies in the States Yeah And they wanted like 40K up front Okay And then they wanted points on the back end. Okay. You're laughing because you know it's bullshit, right? Like, it's like, and it was some, I'm not going to say who it was, but, you know, the British accent kind of sells you, you know?
No, I laugh because like, I know a guy, man, like the guy I used to work with, because before I did the EMD thing. Yeah. The guy I worked with, he had a British accent. And like, I don't know, bro. If you're a Brit American, you can get away with murder with that accent, fam. Oh, man. Man, I know. Okay. I don't want to talk too much, but like you can get in really high places with just how to, if you just know how to play people and how to, you don't even have to know, have any hard skills. If you just know how to, because like I knew one guy, like these guys are not working there anymore, but a guy who used to work at a firm called Cambridge Wilkinson, look them up, by the way, really good investment bank. They don't charge any upfront fees. but the issue of them is like they take on deals like minimum 25 million above that makes sense yeah they're office deals yeah yeah they're they're iBankers they do 25 billion they close 25 billion a year the founder is robert and howard chernan really good like if you ever go in and call them their offices are huge in new york city whatever and long story short they um why am I bringing them up yeah one guy I worked with he was like friends with one of the managing directors and then they're like, oh, we don't do... So usually they say, we don't do funds, we don't do this, we don't do that. But then when you're friends with somebody, it's like, eh, we'll try to crack it through. No engagement fee, whatever. So sometimes it's just that. And check them out. They're a really good company, by the way. I really like them. They're really good to see how...
I think I've built my... For me, I'm still in the building stage. I need to buy a couple more good businesses.
The doors are open I just haven walked through them yet How does Enterprise Value You don have to talk about this part if you can but how does enterprise value work with contracts what do you mean by contracts so these government contract things so how does the enterprise value work with them because like I'm so like I don't know if it's like shares or if it's like like that kind
Of or if it's like the real estate value or so there's no real estate value so like this is this so I can't talk too much about the contract but you own all the equipment all the car you own all the equipment so like when we bought the contract it had a million dollars in equipment okay like on the books good which is great but you can't use that as collateral because kitchen equipment yeah but the value is still there like it'll take a while to sell everything off but the value is
Still there right um but on top of that is a government contract it sounds like a cash count it sounds like it's basically like a cash it's a massive cash yeah it's like a it's like an interesting uh it's a massive cash but I feel like I feel like that's like like I know you're doing other things but I feel like that's like honestly kind of special because um not many
People talk about that yeah but this year we had a tough year we we lost we lost well over six figures because we opened another location I wasn't ready to be open okay okay but you you you left that initiative or were they going to do that anyway or so no so what happened was doing kobe you know a lot a lot of these locations closed down yeah and this so this second location was a big money maker that this this second location alone was doing seven figures yeah and they told us miscommunication misinformation was given to us yeah turns out the information was wrong and we kept it open for a year hoping that it would get better yeah we lost money yeah which is fine it happens but we're not dead yeah we closed it we're closing it at the end of this month and we're gonna try to reopen it again once the building fills up again but the building isn't full yet yeah they're gonna do the whole government back to this work thing or whatever they keep pushing it back it's supposed to be July now it's November So like I in the buildings talking to these people Yeah So they supposed to July a lot of departments have not gone back to work because there no space There no room And a lot of them don't have desks. They have to literally like go online to file to get a desk. And if they can't do that, a lot of them just won't come in. So they're still fighting it, which is fine. Yeah.
This is so interesting. It's like, it's kind of like, it's kind of like having a giant, giant clients that affects like a lot of aspects of the business because the government is like, eh, back to office. Then the cash just comes. But every business is like this anyway. It's kind of like during COVID where innocent businesses minding their own business shut down. It's like, okay, crap. It's like whatever. It's kind of like playing. It's kind of like depending on the will of God or something to just control. It's like having a farm. It's like sometimes like the rain stops and it's like-
Well, especially in Ottawa where it's a government town and a lot of these small businesses were being served by government workers. Yeah. downtown during the day the dead zone yeah because a lot of these small businesses that are feeding the government workers shut down um because they start coming to the office right and a lot of them don't want to come back because they moved far away they moved further away the city's cheaper better living I get it um and ottawa's dying because of it so they're not forcing them but make them come back in and I when I talk to people about this they're like well I want to do it like blah blah I'm like you know there was life before covid right life before covid feels like before COVID, right? Like, 2019, we still have to go outside. Yeah, yeah, yeah, yeah, yeah. You know? Like, I don't understand. Yeah. So it's just, they're fighting it. It is what it is. But I still feel like I still have to diversify. Yeah. Because right now, like, my motto is never be beholden to one master. I like that. Because right now, yes, I have a government contract, and it's on a renewal-based term every five plus five. That's a contract.
What does five plus five mean?
So when you sign a commercial lease, you can sign terms, right? So it's five years. And then you have the option to renew for another five years. So five plus five, right? So that's our base contract for our government contracts, which is five years. So our contracts are on 10-year spreads, and every 10 years you can renegotiate wherever the terms may be whatever it is right so every 10 years you negotiate your terms got it so it's called a five plus five the same thing with commercial real estate yeah one commercial estate um every five or ten years you can renegotiate you know or the landlord at the raise the price or whatever situation may be for for your situation so it's on the five plus five so it's like we're good there but you're still beholden to the rules of the government you still beholden to one master which is the government we're all we all work for government at the end of the day we all pay taxes but I don't want a situation where they decide tomorrow where oh all government cafeterias now gonna be run by government employees because that can happen it's true they can do anything they can do anything right so I don't want I I want I want my portfolio to be as diversified as possible so if one business isn't doing as well, I'm not struggling.
So how do you, okay, how do you basically maximize your life here too? Because it's like, I get that you don't want to be correlated with the gains of one sector. I get that. But then the thing is, it's like you're spending a lot of your efforts. So all the wins and then the suffering and the wins that you're going through is like you're gaining knowledge and systems in your brain and your systems. So then how do you transfer that knowledge over in a compliant way, obviously, to your next deal without you having to go back to square zero? Are you just going to hire people that know how to run it, or are you more like...
So the cafeteria runs itself. We just have to plug someone in, right? So all we're doing is we're lowering our salary, giving that person a salary to work with our managers. They will not be called a manager because we have a great, great manager that's been there for 30 years who works in the kitchen. She just doesn't want to do any of the office work. So we're just going to hire someone to do the office work as she manages the kitchens. That's it.
Very simple and clean.
Very simple and clean, right? And the business runs itself. It's in a government building. It's very turnkey. We have a great back end. Accounting and bookkeeping watches everything. We have the emails if something goes wrong. And we'll just train them how to keep food costs down, keep the office running simple as that and I want again like I discussed I want to start building out my team now to look at bigger opportunities
Bigger deal flows right
Bigger deal flows right
So are you going to hire people to do origination are you going to do origination and you hire people to do capital raising or what's the
So I want to hire people to do capital raising I already have everything else. I already have a marketing team I already have a videography team. I already have operation managers I have all that in place I just need money. That's it
Okay Okay, so let's role play. Let's just put all the commercials aside for a second. Let's pretend that I was helping you raise money.
I like that.
What do you have right now?
Talk to me. Talk to me.
I wish the team was here to be honest as well, but what do you have right now?
Right now, I'm looking at two companies right now. One is a $6 million, $5.1 million deal. It's a spray foam installation company. it's 30 years old the other one is a company in Winnipeg doing well over a million in gross revenue 1.8 in EBITDA 2 million in EBITDA depending on the year and it's a manufacturing company and those are the two deals I'm really heavily looking at and for the spray foam installation company where I'm already partnering with someone who has 25 years of experience in the game to run not run the day-to-day operations but to oversee that whole division and construction in general. Because that's money in Canada, man
Okay So, I mean, you already had success with BDC So, you're going to probably
No Not fast enough. You know how
Private lenders and non-bank private lenders
Speed is everything. Right? Because when it comes to these type of good deals That come on the market They don't stay very long
Oh, on market Okay, so they're on a platform?
Yeah These are on market deals. These are not private market I'm working on two private market deals right now.
I can't speak on those, of course.
But these are on-market deals. And these are really good. And their books are clean.
Okay. So how far down the rabbit hole are you in terms of the platform? Like getting the, about to do LOI, about to get the...
I have the data. I have access to the data room.
Okay. But you didn't send LOI yet.
I don't have the capital, sir.
Oh, it's true. Yeah. Well, you're doing it the right way.
I'm a brokie.
You're doing it the right way. Yeah. Well, I mean, okay. Okay. So, like, I mean, think, okay, on the debt side, and then there's the equity side. So, and then there's probably in the middle. So, I mean, really, just for us to, like, look at some non-bank private lenders that we work with, right? And then they'll offer you terms. We'll see if, like, the DSCR is good.
I'm looking more, yeah. Well, private lenders are great, but the interest is, like, 12%.
Yeah. There's no way around it, though.
Yeah. They're, like, 12% interest rates, right? And a lot of these deals I'm looking at coming to real estate. I'm really focused on the real estate heavy deals. If I'm going to do...
So for the equity, we struggled a lot with equity until we found these co-GP things.
Oh, so co-GP.
So co-general partners. So they're like a... You would like it though. That's the issue. But just an idea. So they're these guys, right? They will They invest They have ownership of the shares or whatever but then they invest equity in more easily Like really they say that what we were looking for Yeah, but then they're not, and they're not, they're not passive though. That's the, that's the thing.
They're, they're active.
That's the, that's the issue.
That's fine. The first two people can be active. You understand, like you have to build a reputation. Like I'm not, one thing I'm not, I'm not a greedy or selfish person. But at the same time, I would like to meet these people to see if we're going to vibe well. Yeah. Why would I not?
Because you said that you wanted more LPs, remember?
I do want more LPs. But at the same time, you have to break into the room.
It's true.
You have to. Right now, I'm outside looking through the window like this. I have to be in the rooms. Once I'm in the rooms, like I said, you start building. Have you ever read the, was it 37 Letters J.D. Rockefeller Wrote to His Son?
I missed that one. No. I didn't read that.
Fire.
Really, eh?
Amazing. Amazing. Everybody should read that.
Yeah, eh?
Everybody. It breaks it down for you. One of the chapters he talked about was, as you know, he owned oil. He owned refineries. He was sitting down with the lenders to try to restructure a loan or get a loan to build another refinery. They all were just brushing him off, being assholes through and through. He said he sucked up his pride. He did what it takes to get the deal done. And he said, one day I will be the bank and I won't need you anymore. That's what I want. I'm okay with taking a second chair because one day I will be the bank and I will not need you anymore.
I wonder where I heard that from because I heard a lot of people say that. And you see the big guys. So Rockefeller, all these guys, right? Because remember back before we were talking about guys that are ahead of us and who to listen to. So these guys are more strategic and so then this is better for strategy.
Yeah. Because you can learn from these guys as well. It's not a situation where if this is my first time doing a $10 million deal and they offer Blackcore Holdings 30%, they'll take 70%. And we can do an earn out where we can eventually buy that 70% from them. and I'm learning their structures and how they do business, brother, what angel investor won't give me money at this point? What family office won't give me money?
I wanted to see, but then this thing is here. After we finish, I'll show you some terms. Because there's a lady that I got terms from a co-GP. That's the quickest way that we've seen. On the equity side, that's not angel. It's like co-GP. And then if there's real estate, it's easier. But in the real estate system, it's not a real estate business. It's like real estate's attached.
Yeah, real estate's attached.
Maybe. It's a little bit hard, but maybe. So basically, you have the co-GP thing going on, and then the interest thing going on. So then the thing is, you're going to have high rates, so you're going to eat that, right? It'll be fast, but you'll eat that. So that's basically it. And then I think the issue with some of these lenders is that they look more towards you. They're not like these BDC guys that they don't care about. They actually care. So then what they'll sometimes do is that Instead of having you look at your net worth, they'll look at the co-GP's net worth. So that's why sometimes that helps. So instead of us, because one thing, another thing that we try to do is we had like the Cody guy that we close the deal with in Texas, like he would be a, he would sign on to different loans as well because of his net worth is like seven mil or whatever. So it was easier for people to get loans. But like, hell, if the co-GP's on it. But then that's basically how we do that one. But before that, then usually the underwriting is pretty intense because like we have to make sure that you're making money after all the cash.
That's what I'm saying. After everything's said and done, the cash flow has to serve, debt service ratio has to be. And it can be one-to-one.
Yeah. Another thing, so sometimes, sometimes what we do is like we find a guy who has a business, i.e. Cody or whatever, and then instead of the co-GP guy, we'll just like get like a loan from another business and then use that as a down payment. So that's another thing that sometimes we can do, but it's a bit more crazy. So, but then the first one is probably how it will actually get done.
Yeah. For us, it's like if we're working with someone who actually have experience of buying businesses, building them, and we're taking second chair, that's a PhD degree that you're getting for free. And it's not a situation where it's like, because again, once you start building reputation, well, one, you play well with others. And two, you're doing these bigger deals within the $5 to $10 to $15 million range. People start to give you money.
Yeah. So it's so much easier to raise money after we got like above like five million. It was so easy to raise more money after that. It was hard before.
It's weird, because the cash has to be there for a lot of these properties or businesses, right? Like if you're buying, what would you prefer, a fourplex or a 24-plex?
24, obviously. Well, that's the way it is, I mean, if everything is the same. But like, because some people are like, oh, a bigger deal is easier to close than the smaller deal, but in me, like sometimes the deal has to make sense. Because we have a guy, he's trying to do distressed right now. Distress is hard, man, because it's obviously, it's distressed. So yeah, there's a reason it's distressed. He's not going to make that much money unless he
Unless he has a written-down plan of turnaround, for a three-year, five-year stretch, of how this property's gonna turn around.
He claims that he does. It's just like, well, there's a lot of...
Does he have it on paper, written down?
He claims that he does, and we took a look at it, but then it's like a lot of MCA takeouts. Because the thing is, there's a lot of lawsuit takeouts, MCA takeouts.
It has open lawsuits on the property?
No, well, the target business has a lawsuit.
Is it the target business, or is it...
The target business has the lawsuits, and then it has MCAs.
I wouldn't touch that.
Yeah, but then sometimes they want to, man. I don't know.
Some people make their money on distressed businesses. For me, like, I like the businesses that are breaking even, because there's nothing but upside. If it's just servicing the debt, it's breaking even, and it probably has bad marketing or no marketing, or the owners just kind of gave up.
A lot of upside there. So do you want to do like a platform or a roll-up where everything is intertwined kind of thing? Because imagine you have all your businesses, right? There's this guy, the School of Hard Knocks guy, that young guy. So he was talking to a PE guy, I don't know if you saw that one, and he's like, yeah, I just roll up a bunch of companies and we use the same AI layer on top of them, so we just manage everything with the AI and then we run all these companies at once. Like he made it sound so easy.
No, it's not that easy, because a lot of these companies are not in the same industry. So we're attacking different industries, but think of it like different trees. Think of us as a gardener. You have different plants, but the stories are kind of intertwined anyway, right? So we have our holding company, which is Blackcore Holdings, and we have different branches that we're working with, right? And again, just like Alex Hormozi, I don't want to be CEO. I don't have the patience for it. I can be an asshole, I just don't have the patience for it. I like buying it, finding what's wrong with it or improving upon it, living off the cash flow, hiring an operator to run that business, as we have a CEO that oversees all those businesses in that division, right? So I would never have to talk to an operator. I'm just talking to the CEO, he deals with the operators who are managing those businesses, and we're good on cash flow, right? And that's just it. That's all I deal with. Again, I understand I would need partners to do that, because I am not good at everything. I cannot do everything. I can't sit down at a computer, I can't look at numbers all day. I'm a face-to-face guy.
What's your, because I can tell you're face to face, but what's your area of genius, like your superpower?
Sales. Sales, marketing, and operations. I know when people are tired. I know what they're good at. It's like coaching. If you're hitting the swim all day, I'm going to teach you how to rip, but I know that's your go-to move. I know for a fact, oh, that's his move, he mastered that. But sometimes you've got to throw that in there too, right? That's the same thing with business. I know what everyone's good at. I'm the coach, right? So basically, I know you're a third-down D-lineman, because you can't run stop for shit, but your pass moves. Are insane. You know, like you're getting to the quarterback quick, but if I actually get there first, if I actually beat it on first down to stop the edge, you're not doing that. So that's basically what I do. I'm really good at that. I'm really good at finding the right people in place to operate those type of businesses, because it's a situation where we can have them run these businesses as we grow. Think of us like we're the captains, and their job is to operate, to make sure that there's fuel in the ship. It's our job to get them there.
You know what, man, the thing is, I had a guy before Tre, right? And he was very, let me turn this back on, he was very administrative. Let me just think. He was more like a secretary. He was more about, okay, let's just do a bunch of this stuff to make sure that things are running, but then we needed to move the business forward and close more deals. So his superpower was more the details and admin and stuff like that, and then, for reasons I'll tell you offline, we got him out of the company. And then the new guy, Tre, after that, that's not really where he trades at. He's not really into all those things. He's more about closing the deals, moving the company forward and stuff like that. So it took me a while to realize that. But then there's this guy in the military at a gym, because he leads people in the military, and he was telling me about a Marcus Aurelius quote that said, don't get mad, give help. And I'm like, yo, what do you mean by that? He's like, basically, if somebody doesn't do what's right, give them the help so that they can solve the problem. And then I'm just like, holy crap.
No, you have to learn that, true, in business. Because as a coach, you coached before. You coached football. You coached youth. When everyone wins, it's on the quarterback or the team, right? But when you lose, who's it on? It's on the coach. Even though you could have the perfect game plan, people don't see what happens on the back end, right? Like that week, you guys probably lost, maybe say 10 people show up to practice the whole week. You know what I mean? They don't see that part. They just see the finished product, right? So even in my business right now, I always ask people like, hey, what are we doing wrong? Because you're not showing up or something's wrong, right? And if you can't give me an answer, then I'm looking for someone else. Because the situation where I'm giving a platform to tell us where, because we clearly failed you that you want to be here or you're not doing your job to the fullest of your ability. Because I failed you. Maybe I didn't give you the proper tools. maybe something in the kitchen broke that we haven't replaced you know what's stopping you from doing your job if you can't give me an answer I'm replacing you but that's that's the business
Ownership mindset, because you're owning it. You're being a winner. You're not being like, oh, let me blame something I can't control.
No, because even today, like, yo, this loan is not on their head, it's on my head. These bills are not on them. They don't have to worry about payroll, I do. So if I don't put you in a position to win, I cannot maximize your potential.
Yeah. But then you're also like, you know how you're like, oh, the government, they can do anything. But you're not just being like, because there's some people that, oh, the government can do anything, if Trump wins I'm screwed, if AOC wins I'm screwed, whatever. So you're more like, I'm going to just buy other businesses so that regardless of what the government does...
I'm going to be on an all-weather portfolio. My end goal is to have 50 million liquid stashed away somewhere. Once you get fuck-you money, which for me is like 50 to 100 million liquid stashed away, whatever, the rest of it is just for the love of the game at this point.
Yeah, no, real talk. Because I think Peter Thiel, not really the biggest fan anymore, but Peter Thiel once said you need at least 50 million to protect yourself from any legal everything.
Yeah. And then I stash it away in an account that no one will ever know about, and I'm just collecting the 10%, 15% a year, whatever it is, and then the rest of the money I'm using. I can breathe, you know. I can breathe in a way where I can maximize my potential without stress about losing everything.
Oh, yeah, man. What about, I guess, short-term stuff though? Like what are you getting out of here? Any winters?
Again, if I purchase a couple more businesses, I will be bicoastal, because I will have proper operators in place. I'll be in Florida. So my end goal is to be Canada six months, Florida three, and Africa three. Because there's so much opportunity there that I'm missing out on. There's too much opportunity for me not to be in Africa.
You have a girl, wife, or anything, a relationship?
No, just recently.
You're single?
Yeah, single.
Okay, recently single.
Yeah, locked in.
Oh, okay. You're available in the market. Or you're focused on your business.
I'm locked in.
That's good. Focus on the distractions, man.
Yeah, I was with somebody for a long period of time. We just wanted different things. And now it's focused on the business.
That's fine. No, I mean, I ask that because it's kind of like, because around family planning and stuff, like that's all important, right? Because you have to like start thinking about like multi-generational wealth, your wealth.
I mean, I'm not doing this for myself. I can tell you that much.
Yeah. And then you have to find somebody that's like, that's willing. I mean, obviously you are, you're a winner. You're a high value man and all that. But like who's down to like say, okay, yeah, I have to go fly around the world or whatever.
If a man is in different houses. Who would say no to that? Who would say no to that?
Good question. You're right.
You're right.
I forgot. Yeah.
Who would say no to that?
Some people probably will.
Say no to like traveling the world and being in three countries a year? That's insane.
Yeah. I mean, once the houses are nice and then like they don't lift a finger, then yeah, I guess anyone would say yes.
I know it changes the subject from business to personal relationships, but if I'm with somebody and I have to travel for work and I'm out the house, like I said, six months in Canada, three months in Florida, three months somewhere else, and of course I'll take vacations in between that, it's my job to replace their income.
Oh, no, 1,000%.
So if you say no, like, oh, I want to work, that's fine. You can work, but I'm still traveling. I still got to go. I still got to figure out what I got to do, right? so regardless of like if I'm with you or not I still have to do what I have to do it's true so it's either you're with the program or it's just you know you only see me six months
It's true, it's true. And the thing is, man, I'm so about Africa and Florida. So you want to work on doing deals there, right?
I'm looking at a couple deals right now.
Yeah, okay. Because we had some clients, and let me tell you, you see the most nerdy, these white business guys, super serious and nerdy. You would never expect them. I'll be on the call. I don't really talk about how, on the mother's side, they're Nigerian, because sometimes, I had an African-American guy, he didn't become a client, by the way, three years ago, he was like, yeah, that Nigerian side of you scares me. Because of the 419 scam stuff. I actually distanced myself from that part of my life. But then I see some people that you would never imagine have any connection with Africa, and they're like, oh, where are you from, where are you from? I'm like, this guy's asking a lot. I just say the Liberia side, because nobody knows where Liberia is. And then it's like, no, where are you from? Like, Liberia, Nigeria background, born in Canada though. And they're like, oh yeah, my wife is this, my wife is that. Usually they have a Black wife, and then usually they have deals in Ghana that they're working on. You would never expect them. They have these multifamily apartments in Ghana, multifamily things in Nigeria too, sometimes even in Uganda. They're like, oh, there's this lovely country called Ghana, and it's very developed, and it's like, yeah, you should be going there. So I think you're on the right thing, man, because you're talking about the returns. And then there's this lady, one client, Sherry, she has property in Uganda, because she said it's really under-hyped, because Ghana is kind of getting all the action, but Uganda...
And Rwanda also. Rwanda, Kenya. Kenya is sick. Sierra Leone, don't sleep. Oh yeah, Sierra Leone, brother. Zim, don't sleep on Zim either. Zimbabwe. Don't sleep on Zim. My boy showed me some real estate there. Some of these houses are going for like six, $700,000 USD.
I feel like, do you have to just know somebody there? Because I feel like everything there...
You have to know somebody there.
Okay, because my grandfather used to work, like, rest in peace, but he used to work for, like, with Goodluck Jonathan, like, the president. And then the thing is, like, like, you hear these, you tell these stories, like, oh, if somebody wants to build a bridge, basically you have these unofficial brokers where you have to keep some money aside because everyone's going to ask for money.
You have to give 10% to this guy. Yeah, sometimes you have to pay this kiddie guy so he doesn't rob you
And all this stuff.
Yeah, you have to know somebody. That's why I say like when you're doing business in Africa, you have to have someone on the ground that you trust.
Yeah. We had a client that was... He was a Nigerian with a Nigerian number and he became a client. He paid thousands of dollars in legit right buying a business in America, legit. It's just that he was in London and going between London and Nigeria. And then that's how he knew... No offense to people that just stay in Nigeria, but that's how he knew he was quote unquote legit because he's like, okay, he's in London. It's like even though he's a Nigerian phone number.
My business partner, you have to meet this guy. His uncle owns a telecommunication company.
He sells cell phones in Nigeria.
He flies between Toronto and Nigeria all the time.
Yeah, I think they have a direct flight.
He's six months in between. Yeah, because he owns a lot of businesses in Nigeria. His family was trying to build a compound. They actually got scammed. So they gave a down payment. It was just a down payment.
Thank God they can afford what happened. Yeah, yeah.
It was a down payment. And then the person took the money. He took everyone's money, not just theirs. So they wanted to build a compound with them, all their friends who made it out. They wanted to build a compound.
Like a little expat community.
Yeah, so they can come back and visit in Lagos. Like outside of Lagos, like that area. And they got scammed. Yeah, it happened. But like, thank God it was very minimal compared to what they could have lost. If, you know, the guy started building and nothing was getting done, right? So you just got to be very cautious about who you do business with and who you trust. I'm very fortunate enough to have people I went to school with that are back home that I know they're decent human beings.
Yeah, you're good. I don't have much of that. So that's an advantage. That's a strategic advantage. I don't have that.
Like my boy's family, like his grandfather, his great great grandfather was the first person who had a car in Ghana.
Oh yeah?
Yeah, his great grandmother was the first doctor, women doctor in Ghana.
But Ghana is like really...
Really. I hear it's doing really well. It's called the gateway to Africa for a reason, because the Ghanaian government is very easy for expats to do business with. So locals kind of hate it in a way, because they're giving away land, you know, other people's land or whatever the situation would be. But it's great in a way that it's putting such a spotlight on Africa, because now you can explore and do business in other locations, other countries and stuff like that. Of course, South Africa is one of the top places to do business. But Ghana, I think it's better. Nigeria does business way better. And then other countries like Kenya are a great place to do business because of the government. Anywhere there's stability in Africa, it's a great place to do business.
Yeah. I mean, honestly, at this point, it sounds like... I don't want to sound ignorant, but sometimes I wonder if it's an oxymoron, stability in Africa at some point.
No, because Africa's changed. Like, China is so involved in Africa. A lot of my friends, when they're going to school, they teach Mandarin in school now. Yeah, in Africa. In Zim, Mandarin is taught in school now. So that just tells you how the West is losing Africa.
That's crazy. Do you see the UN, they got rid of that projection or whatever?
And then they made the concept actually. So one of the courses I took in university, it was a fourth-year mixed grad course, I did a 25-year economic and social model on Nigeria. This was back in 2015, right? It was a school project, but I learned so much about Africa and Nigeria and everything like that when I was doing my research, and it's a situation where Nigeria has the youngest population in the world.
I heard, yeah.
More than 50% of the population is under 25. The West is aging. It's aging. I think, was it more than 60%? It's over 40 now? So we're aging and Europe is aging too. China's aging. India's getting younger or staying young and Africa is very young. So what does that tell you? Where's the consumer market shifting towards? I always tell someone, if you can figure out logistics in Africa, you're a trillionaire. Not even Amazon will touch that. So what does that tell you? If they can figure out the logistics of how to ship everything to wherever they need to get it to, you're a trillionaire.
I spoke to a guy. So I went to a wedding of a friend. I mean, my mother's friends, some connection. And this guy is trying to sell his business for a hundred million dollars, and he's based in Miami. He's actually a good guy you should probably talk to. He's more on the tech side though. He's not really a service guy, but he's just another good, successful, hardworking guy. But then the thing is that this guy was kind of bummed out. He was like, so many people ask me, like, I work so hard here to try to learn about stuff here. And he's from Port Harcourt in Nigeria. And he's like, yeah, I work so hard here. I went to, I went to Purdue. I went to Cornell business school. and it's like I have deals and investors here. So if I go back, then it's like I have to learn everything from zero. So I feel like I should just maximize what I have. So he kind of got burnt out because he was kind of like, eh, I have to learn from zero.
You guys sound like an idea. My brother.
My brother.
I work so hard, my brother.
What do you say?
I have to go home. You have to sound like he does, my brother. When they're stressed, you're always, my brother.
But sometimes they say that and then they're making money anyway doing it. Sometimes they make it seem like it's bad.
No, I understand where you're coming from. I had a friend from Zimbabwe, actually, Zim. And his dad was good friends with the president who just passed away.
Yeah. I don't know anything about him.
You know what I'm talking about. So the president, who was the president for many years, his dad's a doctor. And a lot of them, he had to move back home because he was the eldest boy. And his dad passed. So now he has to become the man in the home. So a lot of them are circumstantial like that. So again, I'm making crazy connections. I have another boy. His dad passed away. He owned a diamond gold mine in DRC. Bro, he has to move 500 kilograms of gold. This is raw. Yeah, raw gold. 500 kilograms.
That's crazy.
Yeah. So he's looking for buyers. So before, all these buyers are coming from Dubai, but with the war and everything like that, private jets are a lot coming to Africa not as frequently. So that's the problem. There's other problems they're having over there, right? And I'm just making all these connections. I met another guy through my boy, these are friends he went to school with. He lives in London now. He flips. Great connection I have. I think you should connect. He buys a lot of property in London. He's always looking for good partners to partner with, and people who have money, so we can do more flips.
So you know what, man, there's this lady in Miami. We tried to work on some deals. She actually introduced us to a lender that we actually closed with. You know, when you go on LinkedIn for all these years, you just meet these people. You kind of like, I'll give it a shot. Yeah, and then they stick around. You have WhatsApp groups. They stick, the good ones stick, the mid ones are mid, and the bad ones are bad, you know. So this lady, she's Camille, shout out Camille if you're watching this, a very lovely thing that she has going on with her daughter. She's one of these people that travel and all that stuff. So she went to China, and she is sourcing building materials for property developers in America and in Florida.
So that's great. But you know what's happening right now in Canada, and it's going to happen in the States? They're raising tariffs on those materials, because it's killing the local market. It's killing manufacturing.
Yeah, but manufacturing in America is kind of like...
But like, so no, it's not manufacturing like we're talking like building.
We're talking
About like finished materials. So when you order finished materials from China, less is 10 times cheaper even with the fees So I know for a fact Canada right now is trying to pass a bill to raise that because it kills local manufacturers Okay So like cabinet makers are being priced out the market. Windows and door companies are being priced out the market because people are willing to wait the three to six months to get their freight from China than to buy locally. And it's killing a lot of those manufacturing jobs and businesses. So they're raising tariffs on those. Building materials are being raised massively from China.
Yeah, but I'm pretty sure tariffing and everything is in vogue right now.
It is, but like I agree with it when it comes to building materials locally because for me it's all about speed. Yeah. Right? If you're building a custom home, I get it.
It's a lot cheaper to get it from China?
Yeah, because if you're building a custom home, you can get all your windows from China.
This is a solveable-
And it's a fraction of the cost.
But this is a solvable problem. Well, I mean, the tariff thing is one issue, but they can just figure it out. It's like Amazon. It's like, okay, we have a fulfillment warehouse down the road. You're the expert on this, but I think they can bring a ton of stuff from China up front.
They're still paying tariffs on it.
Fair. But isn't it still cheaper than local?
So they're trying to tariff it so it's the same price. One to one. Or a bit more expensive. So they try to make it more. But at the same time, you take the risk of your stuff getting stuck at the ports. Because that happens. That happens. But we're buying like $100,000 of doors. So my friend is a manager at a store called Cosmorama, right? And they order millions of doors a year, and sometimes some of your shipments get stuck at the port, and sometimes they get turned away.
Oh, so it's not good for the business. Because I'm not really involved in this business, so I'm just looking at these guys and I'm just like, yo, what's the most capitalistic, efficient way of doing it? And then if it's less efficient, ironically, it's not really that good, but then people are so willing to pay for it. But now they're not, because the government's coming in and tariffing it. I just find it contradictory whenever people are like, oh yeah, capitalism, keep the government out, but then when it comes to tariffing their competitors, they're like, oh yeah, government, come.
Yeah, well, they want to protect what's theirs, right? People vote in their own interest, right? Always. The fact that America voted for Trump shows me what their interests are.
Yeah, right. So they don't really care about Canada.
Like, Canadians voted for Mark Carney because he was the best person to deal with the situation we're in right now.
Yeah, Trump even said it. It was so funny. When Trump met Carney, he's like, let me stop complimenting you. It's bad for your ranking.
Yeah, this guy, he's really good. So the guy who oversees all of Stats Canada, he comes to the caf a lot. And he used to work directly with Carney when Steve Harper was in office. He told me when this guy walks in the room, he's like a hot model. Like everyone stops. It's like time stops. Like he demands that much attention.
Really?
Like he's a very intelligent person. and he's very well spoken and he knows his shit.
He does? You like him?
I don't know him personally.
Okay. You're the first business owner I know that likes Carney.
Carney's more of a central liberal.
Yeah, well, yeah. He's trying to be moderate.
I'm still very liberal. I still believe. We still need social programs and everything like that
To an extent. But you're social for the... I don't think you're an economic...
Major, no.
No, no, no. Economic liberal... Economic... Because you know how... Remember how... Because now everything is like either you're...
No, I say I'm more of a central liberal, in a way where during tax season, I'm conservative.
Yeah, yeah, that's what I mean, that's what I mean. But like, yeah, you're a social liberal.
My views are still very liberal. I still believe that women should have rights. Like birth control rights are a thing. Like, I don't bleed, bro. What am I telling you what to do for? I don't feel your pain. I don't carry for nine months, why should I tell you what to do with that? That has nothing to do with me. Don't get me involved in that, right? So I still believe this, and I still believe in our social programs for women. And to help with the birth rates in Canada, we need more social programs for women, to encourage them to be moms. Right now it's hard.
I think it's cooked, man. Do you think it's too late?
I think no. So it's a trend. The more educated the country is, the less kids are being born, because smarter people have less kids. It's just a fact of life.
Yeah, it's true.
Look at the stats. The smarter your country is, the lower your birth rate. It's as simple as that. So it's a situation where Canada is too educated. Do you know Canada is the most educated country in the world?
Yeah, I mean for the population, right? Like compared to the... that's crazy.
Per capita, yeah. Because the way they view it is a two-year degree or higher. So, was it...
Not a bachelor's, an associate's or higher. You know that the world is screwed if Canada's the most educated country in the world.
It's the most educated country in the world per capita.
That's crazy. Is the education working?
I've been in the American system and the Canadian system. The Canadian system is way better.
The American system, many of them are not educated.
So the way it works is that the state is responsible for education. So my sister went to school in Boston. I think it's the best educational system you can buy or you can get for free in the United States. The New England states have the best educational system you can get. I went to school in Florida. Completely different. When I moved back for grade 12, I was averaging an 80. Before I left, I was averaging a 70 or 60. I spent two years there in a different educational system, got the proper help I needed, came back, and it was easy.
But isn't some of this, like, I find that the worst schools in America are really down here and then the best are like...
Redlining. It's called redlining. It's because of the way government funding works. Redlining basically means that, let's say for example, we're Black people, right? Black areas are defunded, so they get less funding than the rich white areas, and the house values are lower even though we're on the same street, but different sides. That's what redlining is. So a lot of these schools are redlined. It basically means that the government purposely defunded them because they were in minority neighborhoods, and the schools that are in better suburban white neighborhoods got better funding. So they got better education, they have more resources, better teachers, they're able to pay the teachers more. That's literally what happened in American history. And right now there's a big problem in the trades, as you know, finding licensed trades. So back in the day, the trade school used to be connected to the high school, so you could get credits as you're going to trade school. They got rid of that because they really started pushing universities. You know why? Because Fannie Mae and Uncle Sam decided to back student loans. So what happens when the government is backing your student loans? You want to push them towards where?
Towards them getting loans so you can... But like, they're interested... Like, stupid question. Like, they make a lot of money off interest, right? It's not like here where the interest rates are low for student loans. Interest rates are high there.
It's on par with like, yeah. So it's like prime plus two or whatever situation. But like, it's still... Still, yeah. It's like billions, trillions of dollars in debt right now. And the interest alone, these banks are happy. It's crazy, man. It's crazy how at 18 you can't get a house. At 18 you can go to war. At 18 you can take out 100K in student debt. You can get married. But you can't get a loan to start a business. At least you can drink.
21. Oh yeah, yeah, yeah, it's 21.
So that just tells you, right? You trust me with $50,000 or $100,000. And Canada is a lot cheaper, like 30, 40K, which is way better, for a four-year degree of course.
And it's less Canada.
It's like more compressed. Yeah, it's more compressed.
The worst is like down here.
Exactly. It's more compressed, right? But like in the States, you can trust me with $100,000 to $250,000 in student debt. But you won't trust me with a down payment of $100,000 to purchase this company.
Yeah, it's crazy. So imagine like the amount of money. And I think obviously it's weird. Like one thing I agree with Ray Dalio is like I like the, I think education should be like a high priority of a country. Like to make it like frictionless. so not to capitalize off of it but I don't see anything wrong with making it free or making it really cheap if it's good. If somebody else is paying I actually think that's one of the few things that is worth the country as well.
I think it should be a level of barrier of entry just because if everything is free nobody will take it seriously.
That's true.
It's like how many like for example courses how many courses you know that are free that are really good courses that nobody takes seriously?
Unless they're stolen no like usually the free the low ones are the good or the stolen ones.
Yeah. But those are easy to find though. A lot of them are not hard to find.
Yeah, it's because when they make money, because when they make something good and then they're able to sell it successfully, then it's because it's good.
Yeah. People go to weird things or the popular things. But if you create a course tomorrow and you do Zoom calls every night because that's how you sell the course. And then you give all the information, of course, in a Zoom call, nobody knows. And nobody buys the course and nobody does anything with the information because it was all free.
Yeah, I mean, also people don't really buy only for the information. People don't only buy based on how good something is alone. They also buy based on the marketing and the sales as well.
And then there's a lot of shitty courses. Remember, there was a whole 2016 era where people were just selling courses left and right. And the reason I'll never become a course seller, not to say never, but right now it's not my thing, is because I prefer, I like the intimacy of the one-to-one of helping someone.
Yeah, but a lot of the course sellers, they always lump it in with coaching. They put this in with coaching, and then they have, like, look at Skool.com.
They have tiers yeah they have tiers like you buy this course plus this you get a discount on the coaching side
But how many people can you actually coach well I mean you can do group coaching and then you can have like but it's not as good so it's not going to be as good
I would only want to take 10 students a month and deal with those 10 that's it
I know a guy that does that, Sebastian. He's really good. You're going to like this guy. Do you ever see this guy, Sebastian? No? Okay, so take this in. I met him just online, Twitter hustle, 2019. He met me before I started all this business stuff, and he coaches people how to buy businesses. Charges 10K and has one-on-one Zoom calls, and then he takes a portion, and we learned this from him, he takes a portion of equity on the deals that he teaches people how to close. Really, really simple guy. He just goes around traveling with his wife all day. He travels like nine months out of the year, and that's all he does.
I can't travel. I'm a worker.
Well, I mean, he's trying to retire. He's semi-retired right now.
How old is he?
Well, he's not old. He's like mid 40s.
Okay, he's not old.
He's slowing down. He's wrapping up. He already made his money. He already did what you're doing, and then now he's like, I have these equities, you know, whatever. I have these businesses, they're running great, I'm getting money from them, and I get to help people and buy into more businesses.
Yeah, it's great. For me, we're football players, bro. We're D-linemen. On top of that, I'd like to be in the contact.
Hunter-gatherers, man. You've got to be on the hunt. You have to have the dog in you, man.
Like, once I slow down, I'll probably sell everything and retire, because the situation is, if I don't have the desire to continue doing this anymore, why am I still in it?
If you could do anything, so let's say you make money doing anything, would you be doing this still?
Yes.
Okay. Why?
I don't know, bro. I love it. Again, I love it. Like, something about it, like when you win, you really win. I don't know how to explain it. It's just a thrill that can't be explained.
This game has a lot of stakes, man. It has a lot of smart people. It has a lot of big deals.
Like, I feel like, and the connections you make over time, they're like connections, man. Because like I said, your word is bond, especially in this industry. When you tell someone something, they expect you to hold yourself to it. And if you build a good relationship, even when you're out, people still call you. It's true. People still call you, like, hey man, I know you're not out anymore, but if you have two million laying around, I know a great deal for you. That's all it is. I love this. I love this. And the world is your oyster. You're not stopped by borders anymore. Like, we're talking about Africa. We're talking about, like, I could talk about buying a business in Asia.
That's another interesting world. Like, I wonder how the Asian market is.
Exactly. I don't know, but I'm willing to learn. It's a whole other way.
Exactly. Isn't it the biggest economy, China? Isn't it the biggest economy?
Oh, India is growing mass. Yeah, Asia and India, those are massive emerging economies. And America. Like, Brazil is huge as well. Like, there's so much money to be made everywhere. My end goal is to create a bunch of little mini-mes in different places and just feed off of them. Just feed them deals and bring that back to the top. You know what I mean? Because I might not understand the local market, but there's somebody I know that will understand the local market and who's a part of the Blackcore Holdings brand. So I want to open branches everywhere. The world is my oyster, bro. There's no cap to this. There's no cap to what you can do.
There's not, man. Like, I think, let's do a rapid round or whatever you call it. Let's do like a fast, fast, machine gun back and forth. So what's the worst deal that you've ever seen?
Worst deal I've ever seen. I actually thought it was a good deal. It turned out to be a really bad deal, and then the owner stopped responding. That's how you know it was a bad deal because the bank came back they had a lot of questions and we sent the questions to him
Ghosted. What's the deal that got away that you wish you had
The deal I'm looking at right now.
Well it hasn't gone away yet
It's back on the table. So we found this deal last year in November. Again, these numbers are magical to us. We didn't know we could do all this now. It went to LOI. The LOI fell through. For me, that's fate telling me that I should probably take a second look at this.
How far are you with that, by the way?
I have the data room. I'm just looking for capital.
Okay. I know you want to move fast, but man...
Not fast. I just need an LOI. That's it. And they have to accept it, and after that I can take my time.
Side note, after the call, you just send it. We'll talk, we'll get you, you know. We wouldn't do a pressure thing, but we'll have a way of testing it out so that we can see if there's anything. Because I want to get a piece of stuff too. So, very good. Okay. So these deals, right? If there was a business that you would recommend a newbie buys, what would it be?
Any business that's 30 plus years old who has good management.
Would you recommend government contracting?
Yes.
What would you say is the biggest misconception that people see who want to buy a business?
You're automatically a millionaire.
Why? Explain.
You're in debt. You know how net worth works, right? Assets minus liabilities equals net worth. Sometimes you're in the red. Yes, you could be doing 10 million dollars, but if you owe 10 million dollars, you're in the red. You know what I mean? You have good cash flow, but you're not a millionaire.
I love the anti-sell. More people need to be honest and just tell the truth.
That's the truth. You're not a millionaire. It's just like, yes, you're making millions of dollars, but you're still in millions of dollars in debt.
What is something that you wish you told yourself when you were 21 years old?
It'll get easier.
Shit was tough, bro. Like, man, what is this? It's real life. You're really hit with the hard truths.
It'll get easier. Like, you know when you're an athlete, or you used to be a star? You know how it is. When you start, and the lights are off and the game is gone, you have no purpose, right? You have to find that.
It's true. Is there anything that you wish you could go back in time and undo?
No.
Okay. Why is that?
Every lesson I learned is for a reason. Why would I change that? It changed my fate. I'm here today, right? My story's not done.
I love that, man. I love that. So okay, knowing what you know now, I know it's a similar question, but knowing what you know now, if you were to go back 10 years and give specific advice to yourself on how to acquire a business, what would you tell yourself to do?
I would tell myself to get a mentor. That's the first thing. Because back then, I was trying to figure everything out on my own. When you grow up the way I did, I don't like to feel like an inconvenience to people. So I never spoke up to ask a lot of questions. I'm not scared to ask questions, but at the same time, I would prefer to figure it out myself first, then come with the information to someone who has it, and compare notes. Instead of taking those long steps of figuring it out and trying to compare notes, I would just copy their page. I would go to them and see if I can copy their answers. I went through the growing pains for no reason.
It's like the Picasso line. It's like, great artists steal.
Yeah, the greatest form of flattery is imitation.
Yeah. I think this is something that we're doing a lot, because I don't think people should act like they're too smart at the beginning. They should just learn how to take instruction and just do stuff. And then when they start getting experience, and it doesn't work the same way when they grow, then they should start being creative. But I think at first people should just shut up and just listen, you know, and just copy.
If I go back 10 years, 2016 me, literally just left university, just moved back home, I would say find a mentor and get into construction immediately.
But how would you know to get into construction?
I'm going back to tell myself this.
That's what you said.
If I can go back 10 years to tell myself this, that's what I'll tell myself.
Yeah. It's funny. My girl said that if she could tell it, her brother's already in her career, but if my girl was to tell her brother to go into her career, it'd be construction. Yeah, it's really interesting. It's a good business because we took a drive around. We saw all these big houses, construction, construction, construction.
It's great business. It's a great business. Once you get off the tools and you can actually focus on expanding and building relationships, it's a great business.
What would you say is the most scared that you've been in your business life?
Brother, this is a story for the ages, man. A family member actually stole 140 racks from me. And yeah, man, it was over a period of time, of course. I didn't know about it. And then on top of that, everyone told me I should have just shut down that corporation and opened a new one. Because when we were going through the split, I gave them full access to the back end. It was their job to manage the back end, my job to find new business. And what I should have done was close down that numbered corporation, open my own, and split the debt 50-50, or the equity or money in the accounts 50-50, and continue working. I wanted to keep it because I had my name on there. I didn't want to kill that business. It was my first baby. I learned now: never put your name on anything, and don't get too emotional. That shit almost killed me, man. High stress. I was having panic attacks. And that year was the best year. That 600K was the best year of my life, and the worst, because I had a lot of open contracts, I was doing a lot of work, but I was losing money left and right. And on top of that, I owed the government money.
Wait, what does putting your name on it have to do with this guy that stole the money? I'm not making the connection.
Well, because when I asked that individual to leave the business, they asked me for a buyout. I trusted them enough to be like, hey, the back end is good, whatever. I'll give you the buyout for your half of the shares, even though I'm the one who invited you into the business. And you'll take it, you'll leave, I'll keep the company. Turns out taxes weren't filed for three years. There was a lot of money missing. Things were being relabeled. So money was being stolen, and they were changing names on QuickBooks and stuff like that.
Yeah, that's so sketchy.
Yeah. And we found $100,000 worth of discrepancies over three years.
Oh, that's crazy.
So I didn't know any of this. And the person took the money around and disappeared.
Were they a finance guy?
Yeah. Yeah. Classic. So they knew what they were doing. So I got burnt. And on top of that, I had to buy them out, right?
Oh, my God. So double burn.
I got burnt twice. That's where the $140,000 comes from, right? Getting burnt for $100,000 and then buying them out for $40,000. I got burned twice. And it was probably the most stressful time of my life, I would say. Some days I couldn't breathe. Some days I felt suicidal, because I felt stuck. And looking back, what I'm doing now, 140 grand or whatever, I can figure it out within a couple months. I know who to talk to. But back then, 2021, 2022, I felt like the world was ending. It felt like everything around me was collapsing, and I just didn't know what to do. So yeah, that was probably the toughest, toughest time of my life, I would say.
Congratulations on making it through.
Brother, that's what separates the winners from the losers. It's not how you get knocked down, it's how you get back up, right? And the only reason I didn't give up was because I could see that person laughing in my head, and I'm like, I can't let you laugh at me. Because you got away clean. I couldn't. And I recently saw them when I went down to Florida, and they were mad. They were mad. Bro, I came through in the BMW drop top. They were mad. I loved it.
Would you say that you're vindictive?
Yes. I'm petty. But I'm petty in a way where I'm not eventually going after you. If I'm your karma, I'm your karma. That's the universe. But I'm going to make sure you see me win.
So you know, you remind me, there's this Patrick Bet-David book, Choose Your Enemies Wisely. And I like what he said, he has like four different archetypes: the person that likes to beat others, the person that likes to show others, the person that likes to just win for himself, and the person that likes to win and show others, something like that. I'm probably butchering it. But I think it's good to know what gets you going. What gets you going?
I mean, the hate is what keeps me alive, bro. Like, people's like, oh, you shouldn't have hate in your heart. I'm like, what's driving me, bro? Like, love?
Okay, Batman.
Yeah, Batman things, you know? The hate's what keeps me alive. Everyone who ever told me no, I'm going to let you see me shine. Everyone who told me I couldn't do it. And the list gets longer and longer. I'm petty like that. It's not even being petty. You need something that drives you. And people who looked down on me, who told me I couldn't do it, I remember you. I want to make sure you remember me too. And that's it. And people who wouldn't help me, I remember you too. People where I was stuck, not even financial help, I just needed advice: I can't help you, Steve. You know, I remember that. And those who did help me, we're climbing together. Simple as that.
Yeah, man. You know, I'm really loyal to some of my friends that helped me.
It's like blind loyalty, man. Because when you had nothing, they gave you everything. And it's like, you didn't have to do that, but you came through. Even though it probably didn't mean a lot to you, for me it was my last dollar. You know what I mean? I was on my last leg. Or that advice you gave me, or that lawyer you helped me get, when I didn't know where to find a lawyer, it saved my life. I appreciate that. So those people, I still keep around. Those who I was looking for help, and their phones were off, I remember you.
Well, it shows you the real people. Real people that actually care about you. It shows you the real people from the fakes.
Exactly. So yeah, that was the darkest time of my life, I would say. And hopefully it's only sunshine and rainbows from here.
Well, I mean, I don't know about that, but you do get stronger. What's the cliche? It doesn't get easier, you get stronger, or whatever.
Yeah. Like, when broken bones heal, they heal stronger, right?
Yeah, yeah. It's kind of like, Hormozi said something nice. It's like, if you fight a giant gorilla with a small little dagger, it's going to be hard. But if you fight a dragon with a nuclear bomb, then it's easy. So the demons get bigger, but then your army gets stronger too.
That's why I said bigger deals are better. Because you have more wiggle room.
You have more wiggle room. And then I think something that's super under-hyped in this business, in my opinion, is the deal quality and the sponsor quality. You're the sponsor, so you don't really think about sponsor quality, because you're your own sponsor. But for us, we're trying to help people do their deals, and it's actually so dependent on how quality the person is and how quality their network is. So if I'm looking at you as a third party, the first thing I'm like is, man, how good is this guy? Actually, just how good is this guy? I'll tell you this. The biggest determinant on somebody closing the deal has been, this sounds super cliche, how confident they are and how much they believe that they'll close the deal.
Yeah. No, it's true.
Like, yeah. Because there's some people that, like, like the most, like the most, they're almost like, they're not like angry, but they're almost like, like, ah, this deal has to, this deal will close. And when will this deal close? Okay, it's in their language patterns. It's not like, oh, if this deal closes, if this happens, it's like, man, when this deal closes, I'm going to be so angry. When this deal closes, I'm going to be so pissed it took this long. Like they just know in their brain subconsciously that's going to close. It's more about when. And then that energy kind of transfers and then it helps us believe it too. It's like, oh, shoot, this person is legit. And it's like, okay, let's get it to the legit person. And then the lenders are like, oh, this guy is legit. But then another thing too is also I think sometimes their network, so sometimes worst case they don't have any money or whatever, their net worth, whatever, then they're also resourceful. We're resourceful too, but I feel like the resourcefulness is the second thing. If they're like, okay, yeah, we have a business partner that's here, we can use them to move it like this, or oh, hey, can you think of this idea?
That's what AI can't do. They can't critically think.
You guys are thinking, right? No.
You guys have to maneuver. has to find a way to make the deal work.
AI basically replaces VAs, basically. But VAs, we never use VAs to close a deal. So VAs are more just a helper. It's kind of like, as you said, it's like the ketchup, or it's like it's just whatever. It saves us some money. That's all it is. It saves us a little bit of money and time.
So, I mean, this game is cold.
It's hard, but
If you got yourself a Canada goose, I think you'll be fine. I think you'd be fine.
Where are some of your favorite spots in Florida? Not just Miami, but like Florida.
So I spent a lot of time in Port St. Lucie.
Where is that anyway?
So it's two hours north. So it's an hour from Fort Lauderdale.
Oh, okay. Okay. North of Fort Lauderdale. Okay.
I went to high school there. Treasure Coast High School. Shout out to Treasure Coast. Treasure Coast Titans. And it was a very new developed area at the time. So think of it as like the size of Kingston. Very small. Another place I love. I spent some time in Jacksonville I hated Jacksonville I hate Duval County I'm not gonna lie. It's hood
Yeah you know I never stopped there Like I didn't have time To stop there But like I passed by there Like I hear it's kind of ghetto I get scared of it
All of it's ghetto
Are you serious?
Yeah Duval County There's no joke bro Duval's no joke Duval's no joke You'll get clapped anywhere
Are you serious? So what's Duval County?
Duval is Jacksonville. So Duval County, you know how Dade County is Miami? Duval is Jacksonville Yeah Jacksonville County
Well I mean I'm happy I didn't stop there They have a nice bridge though
They have this cool Gorgeous, gorgeous bridge. But Duval County is still, yeah, let's leave it as Jacksonville. Orlando is Orlando.
I like Orlando. I stopped there because I'm like, yo, I like the movies. I like the gyms. It's quiet. It's kind of boring.
I like Tampa.
I like Tampa too.
But the reason I don't like Tampa and I like Tampa at the same time is because Tampa is on the Gulf Coast and get hit with storms more frequently.
Yeah. My friend Andrew, remember the guy I was seeing? Yo his place got wrecked I send you a picture It got wrecked He had this nice cute little house He about to do rents to own Yeah Cute little nice house Destroyed He had his daughter there too It got in shambles man. The house died, and his car got wrecked. It was crazy.
It got destroyed.
That was the last one two years ago.
Tampa is a great place to do business. That's where, what's his name? Patrick, what's that guy's name? Pat something.
The who? The Pat?
No, his name is Patrick.
Oh, yeah, yeah, yeah. The guy I was just quoting the book from. The guy who talks like this.
The Republican Yeah Yeah
Bet-David.
Yeah He's in Tampa
Okay He is?
Yeah He's in Tampa. Tampa is just a mature Miami It's like When you're done partying You come to Tampa. So it's a great place I just don't like the fact That it's on the Gulf Coast And it gets hit With more frequent storms Than anywhere else Same thing with Naples Naples is rich as hell
What do you think of St. Pete's?
St. Pete's, Florida? St. Pete's.
It's really small. I was surprised. People talk... I went there, it's really tiny.
Yeah, it's small. It's kind of like a pass by, but I'm not saying. It's ghetto too, some places.
Oh, really?
Yeah. St. Pete's don't play, bro. You get caught.
There was this place we used to go, me and my mom, back in the day, 10, 15 years ago. It was called Ybor City in Tampa. It used to be lively. It looks like they had this shooting, and now it's nothing. It's desolate.
Yeah. A place I would never go in the United States, St. Louis. I'll stay away from St. Louis.
Where is that again?
St. Louis, Missouri.
Oh, yeah? I don't know anything about it.
St. Louis was the murder capital of America for the longest time, bro.
Really?
I have no business there.
I have no business there, so that's good.
But if you're doing Section 8, great place is Section 8.
Section 8, well, I don't know. I guess we're both not doing it, but do you think it's actually worth it? Oh, yeah?
I think it's worth it if you do it right. But again, you're a landlord, right? But anything that's federally backed is worth it.
It's true.
Is that you have a direct contract with the government.
Yeah, but the government's like, I mean, it used to be stable, but I feel like nothing's stable anymore for the government.
I feel like people just have to know what they're doing. You have to know what you're doing. That's why I'm saying I'm buying businesses regardless of how things move, left or right. Section 8 is always gonna be needed. The government's not gonna evict eight million people.
And I guess I think it's highly dependent on, because isn't Section 8 more of a liberal thing? So do you think the liberals who...
No, both parties choose to fund it. The bill passed, both parties chose to fund it. So something's bipartisan for once. That's good. Are you going to evict 16, or I think it's like 16 or 8 million people? Because where are they going to go anyway? Are you crazy? Well, you know the uproar that's gonna happen.
Yeah, you have to keep the poor happy, or else there'll be uproar.
Or they start to think, yeah, there's more of them. There's more poor than rich. So they better be careful. Things start to get burned down, things start to go missing. That's what happens, right? So both parties funded it. It's bipartisan. It's not going anywhere. But the thing with Section 8 is it has to be single family. Multifamily gets a bit tricky. But you have to buy a lot of single-family homes, right? And I don't like real estate, and I know you're heavily in real estate, but when you buy a business, the cash flow is just way better.
Well, yeah, because real estate is built on low cash flows. But the thing is, it's good on refinancing.
Yeah, like, refi is where you make your money.
Yeah. See, the only thing about real estate is, sometimes it's easy to get debt. It's super easy to close, you know, sometimes, because it's a hard asset. That's the only thing. So we'll take a guy that wants to do a bit, but the only thing about real estate that we learned on our side is I don't like the development stuff, the early stage, like, oh, we have this 500 million dollar stadium in 20 years that we're doing, and then we have to refi it. We used to do real estate in general, but now we say buildings and businesses, you know, commercial and businesses.
That's what matters.
Yeah. And I like the cash-flowing real estate.
And if you find a business that's really like that, you just take equity in the deal on the back end.
Yeah, it's beautiful. It can be a really beautiful thing. But the issue with some of the real estate is we have to just be careful. I don't like developments because it's just like...
Brother, how many developments in Ottawa are on pause right now? The one next to Algonquin, that was supposed to be a retirement home, whatever, they went bankrupt. It hasn't moved in like, what, five years.
Well, I mean, I'm talking about America too. So here's the thing, man. We're kind of weird, because we see people that have funds that actually have the developments that are working. But these people are already experienced and they've already raised the fund. So we started doing a thing where we work with an agency, we run ads for them on Facebook for them to get investors in their investor funnel. But those guys already figured it out. But if somebody's new, and they're doing it, you're telling me about the graveyard story, whatever.
It's just too much headache. It's too much of a headache. It's way too much. I have a boy right now, I think you might know him, Marco. I don't know his last name. He's Haitian. He's been trying to raise money forever to get his development off the ground. He's raising capital right now.
I don't know. I know a guy, there's this guy that's crushing, man. His business partner is like a centimillionaire. I'll send you offline. Ottawa dude, Black dude. These guys actually are legit guys. And then he joined this guy, Bridger Pennington. You know Bridger Pennington? You should probably know him. But anyways, he's setting up a fund, and he has some family office guys. So some of these people do have family office guys. And there's this other program, Richard Wilson. You've heard of that? So he has familyoffices.com. I heard a lot of good things. We had a client that went to his conference and got an anchor investor from there. So there's some people that are real. I haven't gone to their conferences, but I've seen them go in and I've seen them make money, so I'm like, okay, maybe there's something there that I haven't seen.
So those guys are good. I mean, again, dealing with you guys, the people who are on the money side, even right now, we're in an economic downturn, and there's still a lot of money out there.
Imagine during COVID, zero percent interest. So imagine, like...
Were you active during COVID?
Yeah, we launched. But 2021, it was more 2021 when we were pushing our stuff.
Yeah, so imagine those who are in the game for that long and they're buying businesses or flipping properties or buying properties during COVID.
But it was more exciting, because remember the whole talk about, oh, we have a generation retiring, the silver wave is coming. All that talk was more new back then. So we saw so many people that shouldn't be doing this, doing this. And they're getting zero-interest credit cards, and they have negative net worth, and they're buying all these courses, Dan Peña, Fund Launch, the Raises.com program, just buying all these things. It was a zoo. But in terms of the actual deals, yeah, there were deals everywhere, man. IBs were going crazy.
There was a lot of deals everywhere, and we were missing, well, again, if I knew back then what I know now, I would have been 10 steps ahead. But when I was inexperienced, I was just starting in the construction industry. And within seven years, I learned so much. And within the last three years, I learned so much about mergers and acquisitions and private equity and how to structure deals, and how to be compliant, for one. Jesus Christ. There's so much that comes into play.
Compliant on the equity side or?
Compliant on the LP side.
Oh, man. Yeah, that's very serious.
Yeah, there's no joke.
Yeah, it's very serious.
No joke, right? So that's one of the reasons I chose not to raise capital.
Yeah, don't blame me.
It's because I'm not compliant.
You can just raise equity. You can just raise debt.
You don't have to raise equity.
You can just tell the seller, like, oh, hey, I screwed up, and then just raise debt. There's nothing wrong with raising debt. It's less overhead. I don't like the whole equity thing unless you need to because there's less overhead. But you can raise debt, man.
That's a lot easier to be raised.
It's quicker. Cambridge Wilkinson told me, like, I'll never forget it. They were like, debt is always faster than equity.
And then you can always refinance with a bank two years later.
You can refinance.
At a cheaper rate.
Brokers can get paid on debt way easier. Way, way easier.
And they're willing to, oh, there's property involved? Yeah.
Yeah, man. I think equity is okay, though, once in a while. There's some good lawyers out there, man. Shout out to Osie Ukwuoma. He's a partner at a law firm. He played football at Queen's, he had my number, 91. And then he was the guy kind of like, one of the guys kind of showing us around. He was like the coach of success story. He was an all-Canadian football player. And now he's a partner at this law firm. So he's a really good securities lawyer that we work with.
Yeah, that's one thing, getting compliance, doing everything properly, and just deals. My end goal is to be closing three $5 to $10 million deals a year. Which is very, I think, conservative of what I know now.
No, it's doable. It's doable.
It's very conservative of what I know now. Aggressively, five.
Yeah. But I think it's doable. I think just steal some stuff I'm doing. Just maybe get like, look at what, because okay, there's the compliance stuff. I mean, that's something, but you need a lawyer. And then there's the financial underwriting stuff. And then there's the calling and whatever. So I feel like you should just get a guy that helps you execute some of that.
Yeah. And then you incentivize him to... Oh my God, who's that guy? I don't know. Who's that guy?
I wonder who it would be.
I wonder who.
I don't know. I don't know.
I don't know. Who's that guy?
I don't know if it's going to be that guy over there. But on a serious note, though, I'm more on the... We don't really do origination, eh? We just do... Once you originate, then we come in. Maybe we should start doing it. What do you think? Do you think we should start doing it?
We'll talk offline. I think the situation will talk offline.
Yeah, because there's this guy, oh, you should check out this guy, Ryan Morgan. So this guy...
You're giving so much free game to everyone right now. Yeah, I know. And no one would... You know what's crazy? 90% of people would not write this down.
They won't, but the thing is, man, it's like...