Feb. 12, 2021
SPACs, how they work and where is the consumer space headed. By Joe Tonnos
Joe Tonnos, principal at Mistral Equity Partners and Co-Founder at Ketch Ventures talks about his experience of creating SPACs and how founders can benefit from them. We also spoke about the general structure of SPACs and how they differ from other options of going public. We also discussed the future of consumer startups and how it looks like with the new vaccines being distributed.
Joe's LinkedIn: https://www.linkedin.com/in/joetonnos/
Mistral Equity Partners: https://mistralequity.com/
Ketch Ventures: https://www.ketchventures.com/
Transcript
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They're releasing to fundraising
video a podcast about
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fundraising for early-stage
startups.
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The major rules that we follow
here is no bullshit on this
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podcast.
No music to relax, you know,
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advertisements of our sponsors.
We only talk about fundraising
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here and nothing else.
So let's jump into the episode
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and today is a guest speaker.
We have joked on as principal at
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Mistral Equity partners and
under at catch adventures.
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And today we'll talk about specs
because that's one of the things
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that Joe does and also about
what is happening in consumer,
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facing startup fields and where
it is going with the first
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vaccines being distributed right
now.
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So Joe, let's kick it off by
here, giving us some background
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on yourself and on maistro'
Equity partners and catch
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Ventures.
Sounds good concertina, and
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thanks so much for having me on.
I'm excited.
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So a little background on
myself.
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I actually grew up in Canada and
went to school in Upstate New
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York.
I started my career in
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Investment Banking working at
both Lazard and Bank of America
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Merrill.
I worked in the consumer and
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Retail groups, which I was just
kind of throwing into when I was
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at Lazard, and that's kind of
turned into the path.
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For my career.
After spending about four years,
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in Investment Banking.
I joined a group called Mistral
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Equity Partners as you Mentioned
which is traditionally focused
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on Middle Market by oats and
growth Equity of consumer and
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Retail businesses where I've
been for about four years or so.
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In parallel to that.
I co-founded a group called
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catch Ventures with a former
colleague, for my
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investment-banking days and
catch was really formed because
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we had a desire, the two of us
to invest in some early stage
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consumer-facing businesses.
We were both working in consumer
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and Retail investment banking.
And Advising all kinds of large
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cap global companies.
And we saw some of these
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startups and early-stage
businesses, as the consumer
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landscape was starting to shift
and we just became very
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interested in getting involved
with some of those high growth
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businesses.
And so, as the consumer Behavior
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started to change and going
towards better for you product
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offerings and direct-to-consumer
and things of that nature.
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We felt That we wanted to get
involved with some of that.
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So we formed Tech Ventures.
It was initially just a way for
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the two of us to pool our own
personal Capital together, and
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make investments as a team, and
it quickly evolved to becoming a
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Syndicate group.
We've now made about 12
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Investments on the platform and,
and we will Syndicate each of
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our deals now from friends and
family.
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And those, those Investments are
still relatively on the small
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side in the grand scheme.
The things we've made
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Investments as small as about
$50,000 is a Syndicate and as
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large as about, 350 as a
Syndicate and in soaked.
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Yeah, it's it's all consumer
facing businesses that we focus
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on and in we try to get involved
with the management teams and
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founders of those businesses to
be able to add some value, to
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those companies beyond beyond
just writing a check.
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Nice, that's really interesting.
But I'm really I really really
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want to move on to the next
topic which is discussion off
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spec Vehicles.
Because one of the the business
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developer on fundraising radio
team, he told me about specs I
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know like 10 times, maybe so I
really want to cover this topic
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because it was never covered on
fundraising video before.
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So first question is you've done
a few deals through spec
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vehicle.
How do those words?
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So how do those things look
like?
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Yeah, certainly.
We've we've successfully done to
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SPAC deals as a sponsor through
through Mistral, Equity Partners
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in, an affiliate that we created
called Haymaker acquisition Corp
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and inspect our unique vehicle.
They become very popular over
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the last year or so.
We started our stack strategy
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back in 2017.
But essentially that's back is a
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public vehicle.
Inspection is for special
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purpose.
Acquisition company, by the way.
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This pack is a public vehicle
where you go out and raise funds
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from investors.
The first back we did was 330
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million and the second SPAC was
400 million.
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We sell shares to investors at a
$10 share price and attached to
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that a warrant and the it is
sexually a public pool of cash.
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Think of it like a public
checking account that kind of
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sits there, the cash goes into
trust and into a trust and it's
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invested in US Treasury
securities.
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We so that there's some some
interest being collected and not
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just sitting there checking
account and it is up to the
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management team and sponsor of
that SPAC to go out and find a
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Target company.
Usually, if you have a spak,
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you're looking to do a
transaction with with a
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Enterprise Value or Equity value
somewhere north of two or three
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times, the size of your stack
capital and Trust.
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So in the case of Using an
example of 250 million dollars
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back.
You're probably looking to do a
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deal at a minimum that's 500
million of value, but probably
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closer to 750 or a billion to
minimize any type of dilutive
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effect.
And so that company when you do
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find that Target and you
structure the deal and obviously
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there's a whole bunch of nuances
to getting to the point of a
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deal, which I'm happy to answer
questions on.
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But once you get to that point,
And you close the deal and so on
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and so forth.
That company becomes a public
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company.
So you're essentially merging
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that business with your public
pool of capital that you have,
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and it's almost like a reverse
merger or a reverse IPO, and,
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and that company is a
standalone.
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Once the deal closes.
It's essentially a standalone
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public business at that point
and, and we remain shareholders
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in that business.
And in many instances, the
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you'll see the spa.
Answer team take a couple of
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board seats, but it's usually
not something where they're
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taking over the actual
operations or anything like that
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of the business itself that
that's run by the existing
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management team, which is now
just a public company as opposed
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to being a private company.
Nicee.
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Yes, and that's exactly why
specs are so interesting.
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So basically, you raise money,
you make the company public.
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There's basically a shell
company with a promise that you
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will buy out actual Stirrup,
right?
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Yeah, I mean, it's I would tell
you splashed typically are
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seeking companies with that are
a little bit more mature.
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I would say, the traditional
stock model.
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Is that where you might see
businesses that have you know,
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stable cash flow, more of almost
like a private Equity by out
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characteristics to a business.
That being said as facts have
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grown in popularity and there's
a number of news facts.
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And if you look at the speck
Market in 2019, there is about
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50 or 60.
Backs that I poed in 2020.
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We had 248 SPAC IPOs in sir, the
the number of businesses going
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public via a SPAC is obviously
increased but that's also opened
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up a broader gate for the number
of the number of excuse me, the
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types of businesses that that
would go public dies back.
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So you're seeing a lot earlier
stage.
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High-growth businesses that
don't have a some of those
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mature characteristics.
There's been In an influx of
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electric vehicle deals going
public vs Pac.
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And many of those businesses are
pre-revenue companies, but
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they've done a considerable
amount of R&D and have raised
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money in the private markets at
pretty high valuations.
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And in the public market
investors have an appetite for
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those types of deals right now.
And so they continue to be
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successful in the in exiting vs
pack.
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Nice.
So let's talk a little bit about
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the founder perspective because
no survivors.
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Is our Founders were other than
investors.
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So from a Foundry perspective,
what's the difference between
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going public vs.
Pac or versus going public?
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Via standard IP?
Oh, yeah, I would say that the
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there's a few different things
that are highlights to aspect
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transaction versus a regular way
IPO.
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I think one is a little bit more
from a structure side of things.
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So everyone knows how a
traditional IPO works the with
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this pack.
It's a little bit more of a
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major own.
Sunday.
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And so, for existing
shareholders of whoever that
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Target is, there's opportunities
to structure that deal.
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Whether you want to take some
cash off the table, whether you
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want to roll some of your
Equity, you might have to raise
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a pipe to fill an equity Gap, to
get to the valuation in the
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public markets with additional
with additional Public Market
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investors, but I think really
it's a little bit more of a
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flexible structure is one thing
for the Existence.
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Holder's number two is, there's
a little bit more certainty
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around pricing of the
transaction.
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So, you you're working a little
bit more collaboratively with
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whoever, the SPAC sponsor is in
the investment bankers, and
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advisers.
And so, it allows you to go and
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figure out what the right
valuation is by using other
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Market comps, in existing Public
Market, companies in really
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collaboratively, figuring out
what the right valuation is to
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go public, and in your Stuck at
that $10, share price that I
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referenced before and so well,
well, yes, it is a public stock
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and obviously that's driven by
market demand and what that
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share price ends up being the
way you think about structuring.
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It is that that $10 share price.
So it adds a little bit more
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pricing certainty, think about
an IPO scenario, which
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everyone's seen in the news
where somebody goes out to raise
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Capital at a, make it up, 14 to
16 dollar, share price range and
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you end up writing at $12 or
something.
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Because the demand wasn't there.
You're able to kind of figure
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out what that demand is ahead of
time.
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And in you have that fixed $10
per share price before you
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announce the deal to the public
markets.
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There's a little bit more
pricing, certainty around it as
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well.
And then the other point that I
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would mention is you have this
SPAC sponsor team who could help
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support the transaction.
And that might mean
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relationships with public market
investors.
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That might mean the bertie's of
the of the SPAC sponsor team,
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many of which have someone who
has a long tenured operating
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career, and as well, someone who
has a long tenured investing
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career.
And so they they're there is
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potential board members and
other points of support really
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to help the founders and in
running the business, and
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getting it to where it needs to
be as a public publicly traded
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company.
So there's a, there's a number
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of other kind of key points.
That we can run through, but I
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think those are a couple of the
highlights that I like to think
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about that are advantageous to
Founders thinking about various
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ways to tap the public markets,
hundred percent in Greek,
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comparison of love it.
So one more question on The
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Foundry perspective.
So in case of the IPO, the
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foundries have to be like, okay,
we're rolling right into company
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for like eight years and it
seems like we are at the right
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stage to go public.
In case of specs do this pack
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sponsors reach out to Founders
asking them if they're open to
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this kind of deal.
Or is it Founders reaching out
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to a bunch of different spike
managers?
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Yeah, I think generally you're
seeing it where the sponsors are
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reaching out to the to the
Target companies.
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But that shifted a little bit,
especially as spax have become a
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hotter, topic, over the last
little while, I think I think
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back to 2017, when we raised our
first back and we spent usually
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the first meeting with it's hard
to company and/or, its
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shareholders explaining, what
his back was.
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And how the Sure worked in so on
and so forth.
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And that that's no longer.
The case.
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We were all too often times, the
only spec, they were talking to.
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And I think about when we did
our seconds, back transaction or
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we were sir.
I should say, we were searching
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for our Target with our seconds
back.
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There was SPAC starting the
comic become a little bit more
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popular.
There was more of them in the
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marketplace and everything.
And so people started to
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understand what the facts were
how they work.
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And all of that and they were
talking some more of the ones
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back.
And whether those were inbound
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to, to the founder or whether it
was for the relationships that
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the founder had, maybe with an
investment banker, who knew this
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fact, sponsor or whatever.
The case it might be.
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I think you're starting to see a
little bit of a shift from
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because of the popularity of the
of the instrument itself.
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Hmm, great.
Very accurately again, perfect.
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So now, let's move on and talk
about something more relevant to
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most of our The ones who are at
their early stages appreciates
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life since ages, so you mostly
focus on growth stages.
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So the question is, what do you
think is the major difference
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for the founder between the
early stage versus late stage?
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So what is something that's an
early stages?
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Like no one, even cares about
that thing with that on layer
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stage of because it becomes
absolutely vital.
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Yeah.
So I think that's a bit of a
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tough question, but there's
there's something called The
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Thing.
I think obviously at an early
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stage Founders or you were
worried about making sure they
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have a good product getting it
to Market, getting it in front
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of as many people as they can
and really just kind of driving
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driving as much awareness and
growth as possible.
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And I think that that's
obviously super important, but I
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think that making sure that well
you're doing that you're
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building a solid foundation is
very important.
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I think whether that's a matter
of building the right team so
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that you have the right.
The right Personnel in place to
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help execute on your strategy
whether that's ensuring that
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you're with the right.
If you're selling a consumer
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product that you're with the
right retailers, you know, one
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of the things that we always
look for is having an
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omni-channel strategy as opposed
to just being direct to consumer
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or just being at retail or
something like that, you know,
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eyeballs in the aisle or very
important still, is it because
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it relates to consumer product
there.
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But yeah, really.
Only knowing that you're
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building that foundation and
that it's being built the right
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way and it can support you for
future growth.
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I think there's a lot of
businesses that we see where
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they get out of the gates.
They're doing exceptionally
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well, and they maybe get to be a
two or three or five million
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dollar Revenue business in.
They were Scrappy to get there
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and it was just kind of, you
know, drinking from a fire hose
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and it's all good and great, but
the foundation wasn't built.
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Well, instead of getting from
that three or five million
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dollar Revenue Mark to grow to a
15 or 20 million dollar business
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is going to be much more
challenging.
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And so, I think making sure that
you're building that solid
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foundation and thinking about,
what it's going to take to get
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to that next level.
And I know it's always hard
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because it's so important to
think in the moment and you have
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to do it best for your business
at that time, but knowing, you
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know, thinking about the future
and all of that as well is very
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important as As Founders build
their business.
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Because when when we like to
call me in and, you know, on the
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Mistral side catch Ventures is
obviously more at the safety
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equipment, whether it's Mistral
or some of the other Investment
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Partners of ours that like to
invest in a series a or later
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stage having that Foundation is
super important in knowing that
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for us to know that the next
stage of growth is possible for
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this business and I think as you
look at it, especially in Where
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we focus on the fragmentation in
the marketplace is increasing
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considerably and so knowing that
or not knowing but figuring out
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what is is best for your
business to be able to win and
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beat the competition is is
pretty critical.
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Hmm.
One other thing that you
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mentioned in our print recall,
that you think is really
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important even for early-stage
startups, which I kind of
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disagree with.
But at the same time, I kind of
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agree with this but he said
that, you know, drafting
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accurate, five-year plans,
especially Financial plans for
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the company even early stages is
very important for the company.
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So what do you think that?
Yeah, I think it really comes
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down to what I was saying around
building a foundation in
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thinking about your You're
right.
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And I mean, everyone's worried
about Revenue right now in
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building the company as best you
can.
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I think if you if you can try to
plan though, for the medium to
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long term, and maybe it's not
five years, but maybe it's two
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or three years and you think
about how you're going to get to
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that growth.
And if it's a consumer product,
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maybe it's becoming
omni-channel.
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And having that omni-channel
presence in growing.
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If you're DTC, you start to open
up retail opportunities in which
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retailers are going to be best
for your product in.
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Thinking about that build and
how that can build over time.
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I think is important and as an
investor, we know that you're
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not necessarily going to hit
those numbers and every number
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00:18:03,200 --> 00:18:06,100
doesn't have to be perfect and
everything else but to know that
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you know, the founders thinking
about that in building the plan
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the right way I think is
important as to how you think
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00:18:13,700 --> 00:18:16,500
about achieving that growth as
opposed to just saying hey,
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00:18:16,500 --> 00:18:18,800
we're going to do 3 million this
year and we're going to do seven
316
00:18:18,800 --> 00:18:20,200
million next year.
How are you?
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00:18:20,400 --> 00:18:23,900
Get to that 7 million.
What is that plan look like and
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00:18:24,000 --> 00:18:26,800
what does what does the model
look like to say that you're
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00:18:26,800 --> 00:18:28,500
actually going to be able to
achieve it.
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00:18:28,500 --> 00:18:30,800
Are you doing all of the things
necessary?
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00:18:31,100 --> 00:18:33,800
And what does it look like from
a cost standpoint?
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Can you afford to do that based
on the margin profile that you
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00:18:36,900 --> 00:18:39,600
have in?
Obviously margin comes with
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00:18:39,600 --> 00:18:44,000
scale in many instances, I on a
gross basis, but to drive some
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00:18:44,000 --> 00:18:46,100
of that demand, you're going to
have to spend more and
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00:18:46,100 --> 00:18:48,200
marketing.
So just thinking about how that
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00:18:48,800 --> 00:18:51,200
model comes together.
How you're going to be spending
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the money that you're raising.
So on and so forth, I think is
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00:18:54,000 --> 00:18:57,700
critical to think about not just
in what is this next year?
330
00:18:57,700 --> 00:19:01,500
Look like but oftentimes a two,
three and maybe even it is up to
331
00:19:01,500 --> 00:19:04,600
five year plan.
And how you think about
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00:19:04,600 --> 00:19:09,600
executing on that plan is is
important to investors, nice.
333
00:19:09,600 --> 00:19:13,200
He assumed full of question on
long-term plans for early stage
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00:19:13,200 --> 00:19:15,200
startups.
When do you think is a time for
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00:19:15,600 --> 00:19:19,600
a company to start thinking
about the acquisition or an IPO
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00:19:19,600 --> 00:19:24,100
or Essentials back.
Yeah, that's always talk.
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00:19:24,100 --> 00:19:26,200
And I think it's very much a
case by case basis.
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00:19:26,200 --> 00:19:32,100
I do believe that there's
there's a right stage for every
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company.
One thing that I always like to
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00:19:35,400 --> 00:19:39,000
think about, and I heard this a
few years ago from Mark Cuban.
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00:19:39,400 --> 00:19:42,300
He said, if a Founder is focused
on an exit.
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00:19:42,800 --> 00:19:44,900
I don't want to invest with
them, because they're more
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00:19:44,900 --> 00:19:46,900
passionate about the exit than
they are about building your
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00:19:46,900 --> 00:19:49,500
business.
And and that's stuck with me for
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00:19:49,500 --> 00:19:52,900
the last few years.
Since I first heard that too, I
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think it is.
I think about consumer, right.
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00:19:57,400 --> 00:20:00,400
Most businesses are an
acquisition candidate until
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they're probably at least 25
million dollars of Revenue,
349
00:20:05,000 --> 00:20:07,800
maybe even a little little more
than that depending on the on
350
00:20:07,800 --> 00:20:09,400
the substructure within
consumer.
351
00:20:09,700 --> 00:20:13,200
Infill really just focusing on
building that business.
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00:20:13,200 --> 00:20:16,500
One of the things that I hate to
see is when a Founder who's
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early stage, and we get so many
of these seed stage to exit that
354
00:20:19,900 --> 00:20:22,300
catch.
Teachers and they have a
355
00:20:22,800 --> 00:20:27,600
teenager too focused on who the
potential acquirers are in, what
356
00:20:27,600 --> 00:20:30,100
the exit is.
And I think that that's great
357
00:20:30,100 --> 00:20:32,500
when you might be talking to
friends and family about
358
00:20:32,500 --> 00:20:35,500
investing and writing small
Shacks, but when you're, when
359
00:20:35,500 --> 00:20:38,700
you're getting in front of
investors, VC investors or
360
00:20:38,700 --> 00:20:41,100
anything like that, who know how
the marketplace Works.
361
00:20:41,400 --> 00:20:45,100
They know, investors making an
investment to be part of a
362
00:20:45,100 --> 00:20:47,700
potential exit down the road.
That's part of what we do.
363
00:20:47,700 --> 00:20:52,200
That's what our job is.
And so We're pretty good at
364
00:20:52,200 --> 00:20:54,600
being able to figure out who
those acquires potentially could
365
00:20:54,600 --> 00:20:58,700
be in and things like that.
And so giving are time to exits
366
00:20:58,700 --> 00:21:03,700
and saying, hey these six
amazing deals exited at 10 times
367
00:21:03,700 --> 00:21:07,300
revenue on 20 million of Revenue
or whatever it is.
368
00:21:07,600 --> 00:21:10,000
That's that's awesome.
And I think that's something
369
00:21:10,000 --> 00:21:13,100
amazing to Aspire to, but if
that's something that's
370
00:21:13,100 --> 00:21:17,700
Founders, should be focused on
and giving are time to and so
371
00:21:18,400 --> 00:21:21,100
that kind of went off a little
bit there, but You think that
372
00:21:21,500 --> 00:21:25,000
building the right foundation
building the business?
373
00:21:25,000 --> 00:21:28,200
That way that you believe is the
right way to build it as a
374
00:21:28,200 --> 00:21:32,000
founder and maybe that's leaning
on your investors and part of an
375
00:21:32,000 --> 00:21:35,600
Investor's job is to be able to
advise and in guide you on the
376
00:21:35,608 --> 00:21:40,800
right path as a Founder, but
thinking about prepping for an
377
00:21:40,800 --> 00:21:43,900
accident certainly is in
something that should be even
378
00:21:43,900 --> 00:21:45,400
remotely.
Top of mind.
379
00:21:45,400 --> 00:21:49,000
I believe until a business has
either been approached by a
380
00:21:49,008 --> 00:21:53,200
potential acquirer.
Or is of stable size and still
381
00:21:53,200 --> 00:21:56,800
growing where they might be a
1520 plus Million Dollar
382
00:21:56,800 --> 00:22:01,800
business on a revenue side and
going from there.
383
00:22:01,900 --> 00:22:05,000
So that it's a bit of a top
answer.
384
00:22:05,000 --> 00:22:08,700
But I do believe that Founders,
sometimes are a little bit too
385
00:22:08,700 --> 00:22:12,200
focused on what an axe that
could look like and you spend
386
00:22:12,200 --> 00:22:16,100
more time on executing and
because you're not going to get
387
00:22:16,100 --> 00:22:19,900
to that extra opportunity.
If you don't execute, You know
388
00:22:19,900 --> 00:22:22,100
that efficiently.
So part percent.
389
00:22:22,100 --> 00:22:26,000
Yeah, that's very accurate
response again, and yes, there
390
00:22:26,000 --> 00:22:28,500
is no real like right answer to
that question.
391
00:22:28,500 --> 00:22:31,600
It's everything is based deal by
dealing with some investors.
392
00:22:31,600 --> 00:22:35,000
Love to see that slide in a deck
that shows other companies in
393
00:22:35,000 --> 00:22:37,300
your field that had successful
Acquisitions.
394
00:22:37,600 --> 00:22:40,900
Some really don't care about it.
So, you know, again it's a game.
395
00:22:41,400 --> 00:22:43,800
It's a numbers game.
So just keep trying, try
396
00:22:43,800 --> 00:22:46,500
different options, see what
resonates with investors and
397
00:22:46,500 --> 00:22:49,900
then just master that.
Page.
398
00:22:49,900 --> 00:22:54,200
So on this point, I'm always a
big fan to of saying, like,
399
00:22:54,200 --> 00:22:59,100
looking at a broader set to, I
mean, highlighting five or six
400
00:22:59,100 --> 00:23:01,000
deals which had phenomenal
exits.
401
00:23:02,000 --> 00:23:05,000
I mean, that that's great.
But what about the other brands
402
00:23:05,000 --> 00:23:07,600
who actually did and it maybe
wasn't as good of a multiple in,
403
00:23:07,600 --> 00:23:12,600
showing a little bit more
broad-based set of cons.
404
00:23:12,600 --> 00:23:15,100
I mean, everyone's obviously
aspiring to be the best and
405
00:23:15,100 --> 00:23:16,500
that's what everyone should be
doing.
406
00:23:17,300 --> 00:23:23,400
But, you know, if you're A bunch
of em, a valuations of
407
00:23:23,400 --> 00:23:28,300
businesses that were acquired,
not everybody in is going to be
408
00:23:28,300 --> 00:23:31,400
the next star, X bar, or
constantly goes tequila or
409
00:23:31,400 --> 00:23:33,400
whatever.
The case may be, seeing these
410
00:23:34,000 --> 00:23:38,700
huge exit multiples.
So, being a little bit realistic
411
00:23:38,700 --> 00:23:41,100
about about what can exist is
important to.
412
00:23:41,100 --> 00:23:46,100
And, you know, you think about
ass pack or IPO exit to the
413
00:23:46,100 --> 00:23:49,200
public markets.
I mean, you need to be Be
414
00:23:49,600 --> 00:23:53,700
probably at an absolute minimum
a business worth a hundred and
415
00:23:53,700 --> 00:23:57,400
fifty or two hundred million
dollars for that to be the even
416
00:23:57,700 --> 00:24:02,000
the thought.
And so what does that look like?
417
00:24:02,000 --> 00:24:05,100
And how does that company trade
relative to the existing Public
418
00:24:05,100 --> 00:24:07,300
Market comps.
I mean if you're a 10 million
419
00:24:07,300 --> 00:24:11,800
dollar Revenue business, I don't
think a public market exit is in
420
00:24:11,800 --> 00:24:16,200
your near future because those
companies trade more at a at a
421
00:24:17,300 --> 00:24:18,800
vast, probably like a five
times.
422
00:24:19,000 --> 00:24:22,300
When you or seven times revenue
and you've seen some of these
423
00:24:22,300 --> 00:24:26,800
earlier State businesses go
public strive Foods, just had a
424
00:24:27,200 --> 00:24:33,500
had a SPAC announcement last
week Laird superfood had a had a
425
00:24:33,500 --> 00:24:37,900
great IPO last year and has
traded exceptionally well, but
426
00:24:37,900 --> 00:24:42,500
those are those are special
situations that you don't see
427
00:24:42,500 --> 00:24:45,500
happen.
Very often and, and I think you
428
00:24:45,500 --> 00:24:48,400
need to be focused on what's
most realistic for your business
429
00:24:48,400 --> 00:24:54,000
and Think a little bit more
about averages or medians, as
430
00:24:54,000 --> 00:24:58,600
opposed to the the top three or
five percent.
431
00:24:58,600 --> 00:25:03,200
So a hundred percent perfect
answer once again, and yes
432
00:25:03,200 --> 00:25:05,100
investors.
Do you like to see when you were
433
00:25:05,100 --> 00:25:07,700
kind of self-critical?
You know, and he you seemed like
434
00:25:07,700 --> 00:25:10,900
you were taking into account
even not the best option
435
00:25:10,900 --> 00:25:14,200
possible.
So yes, that's very right try to
436
00:25:14,200 --> 00:25:19,600
include something not you know,
top one percentile of Of the
437
00:25:19,600 --> 00:25:22,700
field that you're working on.
Anyhow, let's move on and talk a
438
00:25:22,700 --> 00:25:25,600
little bit more about
consumer-facing deals and where
439
00:25:25,600 --> 00:25:28,200
it is going.
Now, we do first vaccines being
440
00:25:28,200 --> 00:25:30,900
distributed in the United States
and all across the world.
441
00:25:30,900 --> 00:25:33,600
So, what do you think about that
Fields?
442
00:25:33,600 --> 00:25:38,300
Where is it going now?
Yes, I think consumer Behavior
443
00:25:38,300 --> 00:25:40,600
continues to change all the time
and obviously.
444
00:25:40,600 --> 00:25:43,700
So we saw a big change over the
last year or so since since
445
00:25:43,700 --> 00:25:45,200
covid has been part of
everyone's life.
446
00:25:45,200 --> 00:25:51,500
There is a huge uptick in direct
to Consumer through 2020 in just
447
00:25:51,500 --> 00:25:58,600
Ecommerce generally e-commerce
grew in 2020 about five years
448
00:25:58,600 --> 00:26:04,700
worth based on what projections
were prior to covid shift in
449
00:26:04,700 --> 00:26:07,400
consumer Behavior.
People were trying new products
450
00:26:07,400 --> 00:26:10,900
and shopping based on what they
would see on their Instagram
451
00:26:10,900 --> 00:26:14,400
feeds and so on and so forth.
And I'm a little curious to see
452
00:26:14,700 --> 00:26:17,500
how that plays out over the next
6 to 12 months, as you
453
00:26:17,500 --> 00:26:20,600
mentioned, the vaccines now.
Rolling out and as consumer
454
00:26:20,600 --> 00:26:23,300
Behavior, kind of, I don't want
to say returns to normal
455
00:26:23,300 --> 00:26:27,300
necessarily because I think that
covid has been a real reset and
456
00:26:27,300 --> 00:26:30,000
it's more of a post covid
consumer Behavior as opposed to
457
00:26:30,000 --> 00:26:35,200
a return to preach covid and How
are some of these these
458
00:26:35,200 --> 00:26:38,300
businesses going to continue to
perform?
459
00:26:38,300 --> 00:26:40,800
Can that lift that they saw some
of these direct to Consumer
460
00:26:40,800 --> 00:26:43,600
businesses?
The lipid is so in 2020, cannot
461
00:26:43,600 --> 00:26:47,400
be sustained in 2021 and Beyond
and I think that's going to be
462
00:26:47,700 --> 00:26:49,900
interesting for Consumer
investors to look at.
463
00:26:49,900 --> 00:26:53,300
I think that you're going to see
a lot of companies continue to
464
00:26:53,300 --> 00:26:57,200
raise capital in investment.
Funds are flush with capital
465
00:26:57,200 --> 00:26:59,600
right now.
There's a lot of dry powder, but
466
00:26:59,600 --> 00:27:02,400
I think investors are going to
start to grow a little bit weary
467
00:27:02,400 --> 00:27:09,800
of Raise money on a 20/20 number
that was exceptional growth and
468
00:27:09,800 --> 00:27:14,400
the want to see Ken that growth
rate, be sustained or can those
469
00:27:14,400 --> 00:27:17,000
sales be sustained on a
go-forward basis?
470
00:27:17,000 --> 00:27:19,800
And so that's a little bit.
What we're focused on right now
471
00:27:19,800 --> 00:27:23,600
is we think about New
Opportunities is trying to
472
00:27:23,700 --> 00:27:26,400
follow this, this new consumer
behavior and see what's going to
473
00:27:26,400 --> 00:27:32,200
be on top of mind for consumers,
as we come out of the pandemic
474
00:27:32,200 --> 00:27:35,000
and have some level of a return
to normalcy in terms of
475
00:27:35,000 --> 00:27:38,500
behaviors and activity and so on
and so forth.
476
00:27:39,100 --> 00:27:42,600
That being said, I think that if
as I mentioned his kind of
477
00:27:42,600 --> 00:27:47,900
changed the general behavior of
folks, simple things like going
478
00:27:47,900 --> 00:27:50,500
to the office five days a week,
I don't think foremost is going
479
00:27:50,500 --> 00:27:53,600
to return to that at all.
I think people are going to have
480
00:27:53,600 --> 00:27:57,000
a much more flexible work
schedule and as that kind of
481
00:27:58,100 --> 00:28:00,600
takes shape and everything like
that, you're going to start to
482
00:28:00,600 --> 00:28:03,400
see that those changes in
consumer behavior, and I think,
483
00:28:03,600 --> 00:28:06,700
Going to take a little bit of
time for for folks to settle
484
00:28:06,700 --> 00:28:12,600
into that and see see what's of
importance to folks, and, and
485
00:28:13,400 --> 00:28:16,600
those companies and Founders are
going to have to adapt to those
486
00:28:16,600 --> 00:28:21,200
new shifting behaviors as well.
Hmm, again, very accurate, and
487
00:28:21,200 --> 00:28:23,200
they seem pretty, pretty
optimistic as well.
488
00:28:23,200 --> 00:28:26,100
So on this optimistic note,
we're moving on to the last
489
00:28:26,100 --> 00:28:28,600
question of today's episode,
which is a call to action.
490
00:28:28,600 --> 00:28:31,900
So, Joe, what do you want the
listener to do right after the
491
00:28:31,900 --> 00:28:36,500
episode is over?
Yeah, I think that I think, you
492
00:28:36,508 --> 00:28:41,800
know, the as listeners take a
thought as to what you think,
493
00:28:41,800 --> 00:28:44,800
consumer Behavior might look
like going forward.
494
00:28:44,800 --> 00:28:47,600
Kind of what I was just touching
on in what's important to the
495
00:28:47,600 --> 00:28:49,400
consumer these days.
And how are you going to make
496
00:28:49,400 --> 00:28:53,800
your brand product service,
whatever it is resonate with
497
00:28:53,800 --> 00:28:56,300
consumers.
And so, one thing that I think
498
00:28:56,300 --> 00:28:59,800
about that's on Trend right now
with with consumers to
499
00:28:59,800 --> 00:29:03,400
sustainability and whether
that's as simple as having
500
00:29:03,900 --> 00:29:08,500
Recyclable or biodegradable
zero-waste packaging all the way
501
00:29:08,500 --> 00:29:13,800
down to a product that's cleaner
and better for the environment.
502
00:29:14,300 --> 00:29:17,200
One of our portfolio companies
ether diamonds is making
503
00:29:17,700 --> 00:29:21,200
lab-grown diamonds from air
pollution right now and it's a
504
00:29:21,200 --> 00:29:25,000
carbon negative business and
part of our thesis and making
505
00:29:25,000 --> 00:29:27,400
that investment was the fact
that we believe that the
506
00:29:27,400 --> 00:29:32,000
consumer is Very focused on
sustainability and it's going to
507
00:29:32,000 --> 00:29:34,900
continue to be very focused on
sustainability and making the
508
00:29:34,900 --> 00:29:38,500
planet a better place.
And so I would challenge all of
509
00:29:38,500 --> 00:29:40,900
the founders out.
There might be a little bit more
510
00:29:40,900 --> 00:29:44,800
expensive to to make a
recyclable packaging or
511
00:29:44,800 --> 00:29:48,100
something along those lines, but
and I'm probably not saying
512
00:29:48,100 --> 00:29:51,700
something that folks haven't
thought about but but just
513
00:29:51,700 --> 00:29:55,500
taking a seat back and thinking
about what you're putting to
514
00:29:55,500 --> 00:29:58,800
Market and how that's going to
resonate with consumers.
515
00:29:58,800 --> 00:30:03,400
And And why consumers should be
coming to you to buy your
516
00:30:03,400 --> 00:30:07,600
product or service right here?
And that's very eager.
517
00:30:07,600 --> 00:30:10,200
And also the investment in a
carbon negative Solution.
518
00:30:10,200 --> 00:30:12,500
That's really cool.
Good choice there.
519
00:30:12,800 --> 00:30:16,400
Yes.
My call to action is probably
520
00:30:16,400 --> 00:30:18,600
going to be go to the
description of this episode.
521
00:30:18,600 --> 00:30:21,800
As usually, I'll leave a bunch
of Link's there.
522
00:30:22,200 --> 00:30:25,000
Probably one is going to be
about facts and how those works.
523
00:30:25,400 --> 00:30:28,400
So if you didn't understand the
whole thing, you can read an
524
00:30:28,400 --> 00:30:31,700
article on that.
And also, I'll leave a link to
525
00:30:32,100 --> 00:30:36,900
Jose LinkedIn and probably a
link to catch Ventures as well.
526
00:30:36,900 --> 00:30:40,300
So you might go through it, see
what the investing and if you're
527
00:30:40,300 --> 00:30:42,100
a good fit, definitely apply to
them.
528
00:30:42,100 --> 00:30:48,900
And also Link to something else.
Maybe most likely know they're
529
00:30:48,900 --> 00:30:52,500
going to be three links there.
And yes, my call to action is
530
00:30:52,500 --> 00:30:54,600
going to be.
First of all listen to Joe's
531
00:30:54,600 --> 00:30:57,200
call to action and then check
out the links.
532
00:30:57,200 --> 00:30:59,300
I'm going to leave in the
description of this episode and
533
00:30:59,300 --> 00:31:01,600
as usually have a good day.
00:00:05,100 --> 00:00:07,800
They're releasing to fundraising
video a podcast about
2
00:00:07,800 --> 00:00:10,100
fundraising for early-stage
startups.
3
00:00:10,400 --> 00:00:13,600
The major rules that we follow
here is no bullshit on this
4
00:00:13,600 --> 00:00:16,100
podcast.
No music to relax, you know,
5
00:00:16,100 --> 00:00:19,600
advertisements of our sponsors.
We only talk about fundraising
6
00:00:19,600 --> 00:00:23,000
here and nothing else.
So let's jump into the episode
7
00:00:23,600 --> 00:00:27,500
and today is a guest speaker.
We have joked on as principal at
8
00:00:27,500 --> 00:00:32,400
Mistral Equity partners and
under at catch adventures.
9
00:00:32,700 --> 00:00:36,400
And today we'll talk about specs
because that's one of the things
10
00:00:36,400 --> 00:00:40,600
that Joe does and also about
what is happening in consumer,
11
00:00:40,600 --> 00:00:44,100
facing startup fields and where
it is going with the first
12
00:00:44,100 --> 00:00:46,000
vaccines being distributed right
now.
13
00:00:46,000 --> 00:00:49,000
So Joe, let's kick it off by
here, giving us some background
14
00:00:49,000 --> 00:00:53,700
on yourself and on maistro'
Equity partners and catch
15
00:00:53,700 --> 00:00:57,100
Ventures.
Sounds good concertina, and
16
00:00:57,100 --> 00:00:59,300
thanks so much for having me on.
I'm excited.
17
00:01:00,400 --> 00:01:02,100
So a little background on
myself.
18
00:01:02,100 --> 00:01:06,300
I actually grew up in Canada and
went to school in Upstate New
19
00:01:06,300 --> 00:01:08,500
York.
I started my career in
20
00:01:08,500 --> 00:01:12,300
Investment Banking working at
both Lazard and Bank of America
21
00:01:12,300 --> 00:01:14,700
Merrill.
I worked in the consumer and
22
00:01:14,700 --> 00:01:18,100
Retail groups, which I was just
kind of throwing into when I was
23
00:01:18,100 --> 00:01:22,700
at Lazard, and that's kind of
turned into the path.
24
00:01:22,700 --> 00:01:25,500
For my career.
After spending about four years,
25
00:01:25,500 --> 00:01:28,700
in Investment Banking.
I joined a group called Mistral
26
00:01:28,700 --> 00:01:32,300
Equity Partners as you Mentioned
which is traditionally focused
27
00:01:32,400 --> 00:01:36,900
on Middle Market by oats and
growth Equity of consumer and
28
00:01:36,900 --> 00:01:40,700
Retail businesses where I've
been for about four years or so.
29
00:01:41,500 --> 00:01:44,200
In parallel to that.
I co-founded a group called
30
00:01:44,200 --> 00:01:46,300
catch Ventures with a former
colleague, for my
31
00:01:46,300 --> 00:01:50,500
investment-banking days and
catch was really formed because
32
00:01:50,500 --> 00:01:54,700
we had a desire, the two of us
to invest in some early stage
33
00:01:55,000 --> 00:01:58,200
consumer-facing businesses.
We were both working in consumer
34
00:01:58,200 --> 00:02:02,500
and Retail investment banking.
And Advising all kinds of large
35
00:02:02,500 --> 00:02:07,700
cap global companies.
And we saw some of these
36
00:02:08,400 --> 00:02:11,500
startups and early-stage
businesses, as the consumer
37
00:02:11,500 --> 00:02:16,000
landscape was starting to shift
and we just became very
38
00:02:16,000 --> 00:02:18,100
interested in getting involved
with some of those high growth
39
00:02:18,100 --> 00:02:21,300
businesses.
And so, as the consumer Behavior
40
00:02:21,300 --> 00:02:24,200
started to change and going
towards better for you product
41
00:02:24,200 --> 00:02:28,200
offerings and direct-to-consumer
and things of that nature.
42
00:02:29,000 --> 00:02:32,000
We felt That we wanted to get
involved with some of that.
43
00:02:32,000 --> 00:02:35,600
So we formed Tech Ventures.
It was initially just a way for
44
00:02:35,600 --> 00:02:38,600
the two of us to pool our own
personal Capital together, and
45
00:02:38,600 --> 00:02:43,900
make investments as a team, and
it quickly evolved to becoming a
46
00:02:43,900 --> 00:02:47,000
Syndicate group.
We've now made about 12
47
00:02:47,000 --> 00:02:52,800
Investments on the platform and,
and we will Syndicate each of
48
00:02:52,800 --> 00:02:55,100
our deals now from friends and
family.
49
00:02:56,000 --> 00:02:59,000
And those, those Investments are
still relatively on the small
50
00:02:59,000 --> 00:03:02,300
side in the grand scheme.
The things we've made
51
00:03:02,300 --> 00:03:05,400
Investments as small as about
$50,000 is a Syndicate and as
52
00:03:05,400 --> 00:03:11,400
large as about, 350 as a
Syndicate and in soaked.
53
00:03:11,700 --> 00:03:15,200
Yeah, it's it's all consumer
facing businesses that we focus
54
00:03:15,200 --> 00:03:20,100
on and in we try to get involved
with the management teams and
55
00:03:20,100 --> 00:03:25,000
founders of those businesses to
be able to add some value, to
56
00:03:25,000 --> 00:03:27,900
those companies beyond beyond
just writing a check.
57
00:03:29,200 --> 00:03:33,500
Nice, that's really interesting.
But I'm really I really really
58
00:03:33,500 --> 00:03:36,300
want to move on to the next
topic which is discussion off
59
00:03:36,300 --> 00:03:38,800
spec Vehicles.
Because one of the the business
60
00:03:38,800 --> 00:03:42,800
developer on fundraising radio
team, he told me about specs I
61
00:03:42,800 --> 00:03:46,900
know like 10 times, maybe so I
really want to cover this topic
62
00:03:46,900 --> 00:03:49,700
because it was never covered on
fundraising video before.
63
00:03:49,700 --> 00:03:54,000
So first question is you've done
a few deals through spec
64
00:03:54,000 --> 00:03:56,000
vehicle.
How do those words?
65
00:03:56,000 --> 00:03:57,700
So how do those things look
like?
66
00:03:58,600 --> 00:04:01,400
Yeah, certainly.
We've we've successfully done to
67
00:04:01,400 --> 00:04:05,500
SPAC deals as a sponsor through
through Mistral, Equity Partners
68
00:04:05,500 --> 00:04:09,000
in, an affiliate that we created
called Haymaker acquisition Corp
69
00:04:09,200 --> 00:04:15,300
and inspect our unique vehicle.
They become very popular over
70
00:04:15,300 --> 00:04:18,300
the last year or so.
We started our stack strategy
71
00:04:18,300 --> 00:04:21,700
back in 2017.
But essentially that's back is a
72
00:04:21,700 --> 00:04:25,000
public vehicle.
Inspection is for special
73
00:04:25,000 --> 00:04:26,900
purpose.
Acquisition company, by the way.
74
00:04:28,100 --> 00:04:31,300
This pack is a public vehicle
where you go out and raise funds
75
00:04:31,300 --> 00:04:34,700
from investors.
The first back we did was 330
76
00:04:34,700 --> 00:04:37,200
million and the second SPAC was
400 million.
77
00:04:37,900 --> 00:04:42,400
We sell shares to investors at a
$10 share price and attached to
78
00:04:42,400 --> 00:04:48,000
that a warrant and the it is
sexually a public pool of cash.
79
00:04:48,200 --> 00:04:50,800
Think of it like a public
checking account that kind of
80
00:04:50,800 --> 00:04:54,900
sits there, the cash goes into
trust and into a trust and it's
81
00:04:54,900 --> 00:04:57,900
invested in US Treasury
securities.
82
00:04:58,200 --> 00:05:01,900
We so that there's some some
interest being collected and not
83
00:05:01,900 --> 00:05:05,500
just sitting there checking
account and it is up to the
84
00:05:05,500 --> 00:05:09,500
management team and sponsor of
that SPAC to go out and find a
85
00:05:09,800 --> 00:05:14,200
Target company.
Usually, if you have a spak,
86
00:05:14,200 --> 00:05:16,800
you're looking to do a
transaction with with a
87
00:05:17,100 --> 00:05:21,900
Enterprise Value or Equity value
somewhere north of two or three
88
00:05:21,900 --> 00:05:24,900
times, the size of your stack
capital and Trust.
89
00:05:25,500 --> 00:05:30,600
So in the case of Using an
example of 250 million dollars
90
00:05:30,600 --> 00:05:32,300
back.
You're probably looking to do a
91
00:05:32,300 --> 00:05:36,000
deal at a minimum that's 500
million of value, but probably
92
00:05:36,000 --> 00:05:41,300
closer to 750 or a billion to
minimize any type of dilutive
93
00:05:41,300 --> 00:05:45,300
effect.
And so that company when you do
94
00:05:45,300 --> 00:05:48,100
find that Target and you
structure the deal and obviously
95
00:05:48,100 --> 00:05:51,500
there's a whole bunch of nuances
to getting to the point of a
96
00:05:51,508 --> 00:05:55,000
deal, which I'm happy to answer
questions on.
97
00:05:55,000 --> 00:05:59,900
But once you get to that point,
And you close the deal and so on
98
00:05:59,900 --> 00:06:02,200
and so forth.
That company becomes a public
99
00:06:02,200 --> 00:06:04,600
company.
So you're essentially merging
100
00:06:04,600 --> 00:06:08,600
that business with your public
pool of capital that you have,
101
00:06:09,400 --> 00:06:14,400
and it's almost like a reverse
merger or a reverse IPO, and,
102
00:06:14,500 --> 00:06:15,900
and that company is a
standalone.
103
00:06:15,900 --> 00:06:18,400
Once the deal closes.
It's essentially a standalone
104
00:06:18,400 --> 00:06:24,000
public business at that point
and, and we remain shareholders
105
00:06:24,000 --> 00:06:27,000
in that business.
And in many instances, the
106
00:06:27,000 --> 00:06:29,300
you'll see the spa.
Answer team take a couple of
107
00:06:29,300 --> 00:06:32,200
board seats, but it's usually
not something where they're
108
00:06:32,200 --> 00:06:35,100
taking over the actual
operations or anything like that
109
00:06:35,100 --> 00:06:38,700
of the business itself that
that's run by the existing
110
00:06:38,700 --> 00:06:42,600
management team, which is now
just a public company as opposed
111
00:06:42,600 --> 00:06:45,100
to being a private company.
Nicee.
112
00:06:45,100 --> 00:06:47,600
Yes, and that's exactly why
specs are so interesting.
113
00:06:47,600 --> 00:06:51,700
So basically, you raise money,
you make the company public.
114
00:06:51,700 --> 00:06:54,500
There's basically a shell
company with a promise that you
115
00:06:54,500 --> 00:06:57,900
will buy out actual Stirrup,
right?
116
00:06:59,300 --> 00:07:03,700
Yeah, I mean, it's I would tell
you splashed typically are
117
00:07:03,700 --> 00:07:06,900
seeking companies with that are
a little bit more mature.
118
00:07:07,000 --> 00:07:08,600
I would say, the traditional
stock model.
119
00:07:08,600 --> 00:07:12,200
Is that where you might see
businesses that have you know,
120
00:07:12,200 --> 00:07:15,300
stable cash flow, more of almost
like a private Equity by out
121
00:07:15,300 --> 00:07:20,800
characteristics to a business.
That being said as facts have
122
00:07:20,800 --> 00:07:23,600
grown in popularity and there's
a number of news facts.
123
00:07:23,600 --> 00:07:27,600
And if you look at the speck
Market in 2019, there is about
124
00:07:27,600 --> 00:07:30,700
50 or 60.
Backs that I poed in 2020.
125
00:07:30,700 --> 00:07:37,100
We had 248 SPAC IPOs in sir, the
the number of businesses going
126
00:07:37,100 --> 00:07:41,200
public via a SPAC is obviously
increased but that's also opened
127
00:07:41,200 --> 00:07:46,900
up a broader gate for the number
of the number of excuse me, the
128
00:07:46,900 --> 00:07:51,400
types of businesses that that
would go public dies back.
129
00:07:51,400 --> 00:07:53,500
So you're seeing a lot earlier
stage.
130
00:07:53,500 --> 00:07:56,200
High-growth businesses that
don't have a some of those
131
00:07:56,200 --> 00:08:00,000
mature characteristics.
There's been In an influx of
132
00:08:00,000 --> 00:08:02,600
electric vehicle deals going
public vs Pac.
133
00:08:02,600 --> 00:08:06,800
And many of those businesses are
pre-revenue companies, but
134
00:08:06,800 --> 00:08:09,600
they've done a considerable
amount of R&D and have raised
135
00:08:09,600 --> 00:08:12,600
money in the private markets at
pretty high valuations.
136
00:08:12,900 --> 00:08:16,700
And in the public market
investors have an appetite for
137
00:08:16,700 --> 00:08:19,800
those types of deals right now.
And so they continue to be
138
00:08:19,800 --> 00:08:23,800
successful in the in exiting vs
pack.
139
00:08:24,600 --> 00:08:26,600
Nice.
So let's talk a little bit about
140
00:08:26,600 --> 00:08:28,300
the founder perspective because
no survivors.
141
00:08:28,600 --> 00:08:30,600
Is our Founders were other than
investors.
142
00:08:30,900 --> 00:08:33,299
So from a Foundry perspective,
what's the difference between
143
00:08:33,299 --> 00:08:36,799
going public vs.
Pac or versus going public?
144
00:08:37,299 --> 00:08:40,799
Via standard IP?
Oh, yeah, I would say that the
145
00:08:41,900 --> 00:08:45,300
there's a few different things
that are highlights to aspect
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transaction versus a regular way
IPO.
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I think one is a little bit more
from a structure side of things.
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So everyone knows how a
traditional IPO works the with
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this pack.
It's a little bit more of a
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major own.
Sunday.
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And so, for existing
shareholders of whoever that
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Target is, there's opportunities
to structure that deal.
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Whether you want to take some
cash off the table, whether you
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want to roll some of your
Equity, you might have to raise
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a pipe to fill an equity Gap, to
get to the valuation in the
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public markets with additional
with additional Public Market
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investors, but I think really
it's a little bit more of a
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flexible structure is one thing
for the Existence.
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Holder's number two is, there's
a little bit more certainty
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around pricing of the
transaction.
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So, you you're working a little
bit more collaboratively with
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whoever, the SPAC sponsor is in
the investment bankers, and
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advisers.
And so, it allows you to go and
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figure out what the right
valuation is by using other
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Market comps, in existing Public
Market, companies in really
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collaboratively, figuring out
what the right valuation is to
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go public, and in your Stuck at
that $10, share price that I
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referenced before and so well,
well, yes, it is a public stock
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and obviously that's driven by
market demand and what that
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share price ends up being the
way you think about structuring.
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It is that that $10 share price.
So it adds a little bit more
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pricing certainty, think about
an IPO scenario, which
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everyone's seen in the news
where somebody goes out to raise
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Capital at a, make it up, 14 to
16 dollar, share price range and
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you end up writing at $12 or
something.
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Because the demand wasn't there.
You're able to kind of figure
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out what that demand is ahead of
time.
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And in you have that fixed $10
per share price before you
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announce the deal to the public
markets.
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There's a little bit more
pricing, certainty around it as
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well.
And then the other point that I
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would mention is you have this
SPAC sponsor team who could help
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support the transaction.
And that might mean
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relationships with public market
investors.
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That might mean the bertie's of
the of the SPAC sponsor team,
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many of which have someone who
has a long tenured operating
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career, and as well, someone who
has a long tenured investing
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career.
And so they they're there is
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potential board members and
other points of support really
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to help the founders and in
running the business, and
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getting it to where it needs to
be as a public publicly traded
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company.
So there's a, there's a number
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of other kind of key points.
That we can run through, but I
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think those are a couple of the
highlights that I like to think
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about that are advantageous to
Founders thinking about various
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ways to tap the public markets,
hundred percent in Greek,
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comparison of love it.
So one more question on The
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Foundry perspective.
So in case of the IPO, the
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foundries have to be like, okay,
we're rolling right into company
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for like eight years and it
seems like we are at the right
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stage to go public.
In case of specs do this pack
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sponsors reach out to Founders
asking them if they're open to
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this kind of deal.
Or is it Founders reaching out
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to a bunch of different spike
managers?
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Yeah, I think generally you're
seeing it where the sponsors are
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reaching out to the to the
Target companies.
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But that shifted a little bit,
especially as spax have become a
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hotter, topic, over the last
little while, I think I think
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back to 2017, when we raised our
first back and we spent usually
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the first meeting with it's hard
to company and/or, its
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shareholders explaining, what
his back was.
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And how the Sure worked in so on
and so forth.
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And that that's no longer.
The case.
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We were all too often times, the
only spec, they were talking to.
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And I think about when we did
our seconds, back transaction or
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we were sir.
I should say, we were searching
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for our Target with our seconds
back.
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00:12:46,400 --> 00:12:50,300
There was SPAC starting the
comic become a little bit more
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popular.
There was more of them in the
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marketplace and everything.
And so people started to
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understand what the facts were
how they work.
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And all of that and they were
talking some more of the ones
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back.
And whether those were inbound
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to, to the founder or whether it
was for the relationships that
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00:13:06,700 --> 00:13:09,600
the founder had, maybe with an
investment banker, who knew this
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fact, sponsor or whatever.
The case it might be.
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00:13:12,500 --> 00:13:15,700
I think you're starting to see a
little bit of a shift from
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because of the popularity of the
of the instrument itself.
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00:13:20,700 --> 00:13:23,800
Hmm, great.
Very accurately again, perfect.
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So now, let's move on and talk
about something more relevant to
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most of our The ones who are at
their early stages appreciates
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life since ages, so you mostly
focus on growth stages.
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So the question is, what do you
think is the major difference
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for the founder between the
early stage versus late stage?
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00:13:43,100 --> 00:13:46,000
So what is something that's an
early stages?
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00:13:46,700 --> 00:13:49,500
Like no one, even cares about
that thing with that on layer
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00:13:49,500 --> 00:13:52,200
stage of because it becomes
absolutely vital.
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00:13:53,800 --> 00:13:55,400
Yeah.
So I think that's a bit of a
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00:13:55,400 --> 00:13:58,100
tough question, but there's
there's something called The
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Thing.
I think obviously at an early
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stage Founders or you were
worried about making sure they
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have a good product getting it
to Market, getting it in front
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of as many people as they can
and really just kind of driving
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driving as much awareness and
growth as possible.
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And I think that that's
obviously super important, but I
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think that making sure that well
you're doing that you're
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building a solid foundation is
very important.
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I think whether that's a matter
of building the right team so
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that you have the right.
The right Personnel in place to
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help execute on your strategy
whether that's ensuring that
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you're with the right.
If you're selling a consumer
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product that you're with the
right retailers, you know, one
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of the things that we always
look for is having an
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omni-channel strategy as opposed
to just being direct to consumer
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or just being at retail or
something like that, you know,
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00:14:50,000 --> 00:14:52,700
eyeballs in the aisle or very
important still, is it because
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it relates to consumer product
there.
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But yeah, really.
Only knowing that you're
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building that foundation and
that it's being built the right
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way and it can support you for
future growth.
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I think there's a lot of
businesses that we see where
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they get out of the gates.
They're doing exceptionally
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well, and they maybe get to be a
two or three or five million
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dollar Revenue business in.
They were Scrappy to get there
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and it was just kind of, you
know, drinking from a fire hose
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and it's all good and great, but
the foundation wasn't built.
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Well, instead of getting from
that three or five million
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dollar Revenue Mark to grow to a
15 or 20 million dollar business
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is going to be much more
challenging.
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And so, I think making sure that
you're building that solid
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foundation and thinking about,
what it's going to take to get
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to that next level.
And I know it's always hard
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because it's so important to
think in the moment and you have
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to do it best for your business
at that time, but knowing, you
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know, thinking about the future
and all of that as well is very
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important as As Founders build
their business.
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Because when when we like to
call me in and, you know, on the
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Mistral side catch Ventures is
obviously more at the safety
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00:16:05,600 --> 00:16:10,400
equipment, whether it's Mistral
or some of the other Investment
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Partners of ours that like to
invest in a series a or later
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00:16:14,700 --> 00:16:20,200
stage having that Foundation is
super important in knowing that
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for us to know that the next
stage of growth is possible for
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00:16:24,700 --> 00:16:28,700
this business and I think as you
look at it, especially in Where
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we focus on the fragmentation in
the marketplace is increasing
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considerably and so knowing that
or not knowing but figuring out
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what is is best for your
business to be able to win and
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beat the competition is is
pretty critical.
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Hmm.
One other thing that you
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00:16:52,708 --> 00:16:55,700
mentioned in our print recall,
that you think is really
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important even for early-stage
startups, which I kind of
291
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disagree with.
But at the same time, I kind of
292
00:17:01,500 --> 00:17:04,500
agree with this but he said
that, you know, drafting
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accurate, five-year plans,
especially Financial plans for
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the company even early stages is
very important for the company.
295
00:17:12,800 --> 00:17:17,000
So what do you think that?
Yeah, I think it really comes
296
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down to what I was saying around
building a foundation in
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00:17:19,300 --> 00:17:21,099
thinking about your You're
right.
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00:17:21,099 --> 00:17:24,500
And I mean, everyone's worried
about Revenue right now in
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building the company as best you
can.
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I think if you if you can try to
plan though, for the medium to
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long term, and maybe it's not
five years, but maybe it's two
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00:17:33,000 --> 00:17:35,500
or three years and you think
about how you're going to get to
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00:17:35,500 --> 00:17:37,900
that growth.
And if it's a consumer product,
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maybe it's becoming
omni-channel.
305
00:17:40,600 --> 00:17:43,900
And having that omni-channel
presence in growing.
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00:17:43,900 --> 00:17:47,500
If you're DTC, you start to open
up retail opportunities in which
307
00:17:47,500 --> 00:17:50,200
retailers are going to be best
for your product in.
308
00:17:50,300 --> 00:17:53,500
Thinking about that build and
how that can build over time.
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00:17:53,700 --> 00:17:59,900
I think is important and as an
investor, we know that you're
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00:17:59,900 --> 00:18:03,200
not necessarily going to hit
those numbers and every number
311
00:18:03,200 --> 00:18:06,100
doesn't have to be perfect and
everything else but to know that
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00:18:07,100 --> 00:18:10,800
you know, the founders thinking
about that in building the plan
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00:18:10,800 --> 00:18:13,700
the right way I think is
important as to how you think
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00:18:13,700 --> 00:18:16,500
about achieving that growth as
opposed to just saying hey,
315
00:18:16,500 --> 00:18:18,800
we're going to do 3 million this
year and we're going to do seven
316
00:18:18,800 --> 00:18:20,200
million next year.
How are you?
317
00:18:20,400 --> 00:18:23,900
Get to that 7 million.
What is that plan look like and
318
00:18:24,000 --> 00:18:26,800
what does what does the model
look like to say that you're
319
00:18:26,800 --> 00:18:28,500
actually going to be able to
achieve it.
320
00:18:28,500 --> 00:18:30,800
Are you doing all of the things
necessary?
321
00:18:31,100 --> 00:18:33,800
And what does it look like from
a cost standpoint?
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00:18:34,200 --> 00:18:36,900
Can you afford to do that based
on the margin profile that you
323
00:18:36,900 --> 00:18:39,600
have in?
Obviously margin comes with
324
00:18:39,600 --> 00:18:44,000
scale in many instances, I on a
gross basis, but to drive some
325
00:18:44,000 --> 00:18:46,100
of that demand, you're going to
have to spend more and
326
00:18:46,100 --> 00:18:48,200
marketing.
So just thinking about how that
327
00:18:48,800 --> 00:18:51,200
model comes together.
How you're going to be spending
328
00:18:51,200 --> 00:18:54,000
the money that you're raising.
So on and so forth, I think is
329
00:18:54,000 --> 00:18:57,700
critical to think about not just
in what is this next year?
330
00:18:57,700 --> 00:19:01,500
Look like but oftentimes a two,
three and maybe even it is up to
331
00:19:01,500 --> 00:19:04,600
five year plan.
And how you think about
332
00:19:04,600 --> 00:19:09,600
executing on that plan is is
important to investors, nice.
333
00:19:09,600 --> 00:19:13,200
He assumed full of question on
long-term plans for early stage
334
00:19:13,200 --> 00:19:15,200
startups.
When do you think is a time for
335
00:19:15,600 --> 00:19:19,600
a company to start thinking
about the acquisition or an IPO
336
00:19:19,600 --> 00:19:24,100
or Essentials back.
Yeah, that's always talk.
337
00:19:24,100 --> 00:19:26,200
And I think it's very much a
case by case basis.
338
00:19:26,200 --> 00:19:32,100
I do believe that there's
there's a right stage for every
339
00:19:32,100 --> 00:19:35,400
company.
One thing that I always like to
340
00:19:35,400 --> 00:19:39,000
think about, and I heard this a
few years ago from Mark Cuban.
341
00:19:39,400 --> 00:19:42,300
He said, if a Founder is focused
on an exit.
342
00:19:42,800 --> 00:19:44,900
I don't want to invest with
them, because they're more
343
00:19:44,900 --> 00:19:46,900
passionate about the exit than
they are about building your
344
00:19:46,900 --> 00:19:49,500
business.
And and that's stuck with me for
345
00:19:49,500 --> 00:19:52,900
the last few years.
Since I first heard that too, I
346
00:19:52,900 --> 00:19:57,300
think it is.
I think about consumer, right.
347
00:19:57,400 --> 00:20:00,400
Most businesses are an
acquisition candidate until
348
00:20:00,400 --> 00:20:03,900
they're probably at least 25
million dollars of Revenue,
349
00:20:05,000 --> 00:20:07,800
maybe even a little little more
than that depending on the on
350
00:20:07,800 --> 00:20:09,400
the substructure within
consumer.
351
00:20:09,700 --> 00:20:13,200
Infill really just focusing on
building that business.
352
00:20:13,200 --> 00:20:16,500
One of the things that I hate to
see is when a Founder who's
353
00:20:16,500 --> 00:20:19,900
early stage, and we get so many
of these seed stage to exit that
354
00:20:19,900 --> 00:20:22,300
catch.
Teachers and they have a
355
00:20:22,800 --> 00:20:27,600
teenager too focused on who the
potential acquirers are in, what
356
00:20:27,600 --> 00:20:30,100
the exit is.
And I think that that's great
357
00:20:30,100 --> 00:20:32,500
when you might be talking to
friends and family about
358
00:20:32,500 --> 00:20:35,500
investing and writing small
Shacks, but when you're, when
359
00:20:35,500 --> 00:20:38,700
you're getting in front of
investors, VC investors or
360
00:20:38,700 --> 00:20:41,100
anything like that, who know how
the marketplace Works.
361
00:20:41,400 --> 00:20:45,100
They know, investors making an
investment to be part of a
362
00:20:45,100 --> 00:20:47,700
potential exit down the road.
That's part of what we do.
363
00:20:47,700 --> 00:20:52,200
That's what our job is.
And so We're pretty good at
364
00:20:52,200 --> 00:20:54,600
being able to figure out who
those acquires potentially could
365
00:20:54,600 --> 00:20:58,700
be in and things like that.
And so giving are time to exits
366
00:20:58,700 --> 00:21:03,700
and saying, hey these six
amazing deals exited at 10 times
367
00:21:03,700 --> 00:21:07,300
revenue on 20 million of Revenue
or whatever it is.
368
00:21:07,600 --> 00:21:10,000
That's that's awesome.
And I think that's something
369
00:21:10,000 --> 00:21:13,100
amazing to Aspire to, but if
that's something that's
370
00:21:13,100 --> 00:21:17,700
Founders, should be focused on
and giving are time to and so
371
00:21:18,400 --> 00:21:21,100
that kind of went off a little
bit there, but You think that
372
00:21:21,500 --> 00:21:25,000
building the right foundation
building the business?
373
00:21:25,000 --> 00:21:28,200
That way that you believe is the
right way to build it as a
374
00:21:28,200 --> 00:21:32,000
founder and maybe that's leaning
on your investors and part of an
375
00:21:32,000 --> 00:21:35,600
Investor's job is to be able to
advise and in guide you on the
376
00:21:35,608 --> 00:21:40,800
right path as a Founder, but
thinking about prepping for an
377
00:21:40,800 --> 00:21:43,900
accident certainly is in
something that should be even
378
00:21:43,900 --> 00:21:45,400
remotely.
Top of mind.
379
00:21:45,400 --> 00:21:49,000
I believe until a business has
either been approached by a
380
00:21:49,008 --> 00:21:53,200
potential acquirer.
Or is of stable size and still
381
00:21:53,200 --> 00:21:56,800
growing where they might be a
1520 plus Million Dollar
382
00:21:56,800 --> 00:22:01,800
business on a revenue side and
going from there.
383
00:22:01,900 --> 00:22:05,000
So that it's a bit of a top
answer.
384
00:22:05,000 --> 00:22:08,700
But I do believe that Founders,
sometimes are a little bit too
385
00:22:08,700 --> 00:22:12,200
focused on what an axe that
could look like and you spend
386
00:22:12,200 --> 00:22:16,100
more time on executing and
because you're not going to get
387
00:22:16,100 --> 00:22:19,900
to that extra opportunity.
If you don't execute, You know
388
00:22:19,900 --> 00:22:22,100
that efficiently.
So part percent.
389
00:22:22,100 --> 00:22:26,000
Yeah, that's very accurate
response again, and yes, there
390
00:22:26,000 --> 00:22:28,500
is no real like right answer to
that question.
391
00:22:28,500 --> 00:22:31,600
It's everything is based deal by
dealing with some investors.
392
00:22:31,600 --> 00:22:35,000
Love to see that slide in a deck
that shows other companies in
393
00:22:35,000 --> 00:22:37,300
your field that had successful
Acquisitions.
394
00:22:37,600 --> 00:22:40,900
Some really don't care about it.
So, you know, again it's a game.
395
00:22:41,400 --> 00:22:43,800
It's a numbers game.
So just keep trying, try
396
00:22:43,800 --> 00:22:46,500
different options, see what
resonates with investors and
397
00:22:46,500 --> 00:22:49,900
then just master that.
Page.
398
00:22:49,900 --> 00:22:54,200
So on this point, I'm always a
big fan to of saying, like,
399
00:22:54,200 --> 00:22:59,100
looking at a broader set to, I
mean, highlighting five or six
400
00:22:59,100 --> 00:23:01,000
deals which had phenomenal
exits.
401
00:23:02,000 --> 00:23:05,000
I mean, that that's great.
But what about the other brands
402
00:23:05,000 --> 00:23:07,600
who actually did and it maybe
wasn't as good of a multiple in,
403
00:23:07,600 --> 00:23:12,600
showing a little bit more
broad-based set of cons.
404
00:23:12,600 --> 00:23:15,100
I mean, everyone's obviously
aspiring to be the best and
405
00:23:15,100 --> 00:23:16,500
that's what everyone should be
doing.
406
00:23:17,300 --> 00:23:23,400
But, you know, if you're A bunch
of em, a valuations of
407
00:23:23,400 --> 00:23:28,300
businesses that were acquired,
not everybody in is going to be
408
00:23:28,300 --> 00:23:31,400
the next star, X bar, or
constantly goes tequila or
409
00:23:31,400 --> 00:23:33,400
whatever.
The case may be, seeing these
410
00:23:34,000 --> 00:23:38,700
huge exit multiples.
So, being a little bit realistic
411
00:23:38,700 --> 00:23:41,100
about about what can exist is
important to.
412
00:23:41,100 --> 00:23:46,100
And, you know, you think about
ass pack or IPO exit to the
413
00:23:46,100 --> 00:23:49,200
public markets.
I mean, you need to be Be
414
00:23:49,600 --> 00:23:53,700
probably at an absolute minimum
a business worth a hundred and
415
00:23:53,700 --> 00:23:57,400
fifty or two hundred million
dollars for that to be the even
416
00:23:57,700 --> 00:24:02,000
the thought.
And so what does that look like?
417
00:24:02,000 --> 00:24:05,100
And how does that company trade
relative to the existing Public
418
00:24:05,100 --> 00:24:07,300
Market comps.
I mean if you're a 10 million
419
00:24:07,300 --> 00:24:11,800
dollar Revenue business, I don't
think a public market exit is in
420
00:24:11,800 --> 00:24:16,200
your near future because those
companies trade more at a at a
421
00:24:17,300 --> 00:24:18,800
vast, probably like a five
times.
422
00:24:19,000 --> 00:24:22,300
When you or seven times revenue
and you've seen some of these
423
00:24:22,300 --> 00:24:26,800
earlier State businesses go
public strive Foods, just had a
424
00:24:27,200 --> 00:24:33,500
had a SPAC announcement last
week Laird superfood had a had a
425
00:24:33,500 --> 00:24:37,900
great IPO last year and has
traded exceptionally well, but
426
00:24:37,900 --> 00:24:42,500
those are those are special
situations that you don't see
427
00:24:42,500 --> 00:24:45,500
happen.
Very often and, and I think you
428
00:24:45,500 --> 00:24:48,400
need to be focused on what's
most realistic for your business
429
00:24:48,400 --> 00:24:54,000
and Think a little bit more
about averages or medians, as
430
00:24:54,000 --> 00:24:58,600
opposed to the the top three or
five percent.
431
00:24:58,600 --> 00:25:03,200
So a hundred percent perfect
answer once again, and yes
432
00:25:03,200 --> 00:25:05,100
investors.
Do you like to see when you were
433
00:25:05,100 --> 00:25:07,700
kind of self-critical?
You know, and he you seemed like
434
00:25:07,700 --> 00:25:10,900
you were taking into account
even not the best option
435
00:25:10,900 --> 00:25:14,200
possible.
So yes, that's very right try to
436
00:25:14,200 --> 00:25:19,600
include something not you know,
top one percentile of Of the
437
00:25:19,600 --> 00:25:22,700
field that you're working on.
Anyhow, let's move on and talk a
438
00:25:22,700 --> 00:25:25,600
little bit more about
consumer-facing deals and where
439
00:25:25,600 --> 00:25:28,200
it is going.
Now, we do first vaccines being
440
00:25:28,200 --> 00:25:30,900
distributed in the United States
and all across the world.
441
00:25:30,900 --> 00:25:33,600
So, what do you think about that
Fields?
442
00:25:33,600 --> 00:25:38,300
Where is it going now?
Yes, I think consumer Behavior
443
00:25:38,300 --> 00:25:40,600
continues to change all the time
and obviously.
444
00:25:40,600 --> 00:25:43,700
So we saw a big change over the
last year or so since since
445
00:25:43,700 --> 00:25:45,200
covid has been part of
everyone's life.
446
00:25:45,200 --> 00:25:51,500
There is a huge uptick in direct
to Consumer through 2020 in just
447
00:25:51,500 --> 00:25:58,600
Ecommerce generally e-commerce
grew in 2020 about five years
448
00:25:58,600 --> 00:26:04,700
worth based on what projections
were prior to covid shift in
449
00:26:04,700 --> 00:26:07,400
consumer Behavior.
People were trying new products
450
00:26:07,400 --> 00:26:10,900
and shopping based on what they
would see on their Instagram
451
00:26:10,900 --> 00:26:14,400
feeds and so on and so forth.
And I'm a little curious to see
452
00:26:14,700 --> 00:26:17,500
how that plays out over the next
6 to 12 months, as you
453
00:26:17,500 --> 00:26:20,600
mentioned, the vaccines now.
Rolling out and as consumer
454
00:26:20,600 --> 00:26:23,300
Behavior, kind of, I don't want
to say returns to normal
455
00:26:23,300 --> 00:26:27,300
necessarily because I think that
covid has been a real reset and
456
00:26:27,300 --> 00:26:30,000
it's more of a post covid
consumer Behavior as opposed to
457
00:26:30,000 --> 00:26:35,200
a return to preach covid and How
are some of these these
458
00:26:35,200 --> 00:26:38,300
businesses going to continue to
perform?
459
00:26:38,300 --> 00:26:40,800
Can that lift that they saw some
of these direct to Consumer
460
00:26:40,800 --> 00:26:43,600
businesses?
The lipid is so in 2020, cannot
461
00:26:43,600 --> 00:26:47,400
be sustained in 2021 and Beyond
and I think that's going to be
462
00:26:47,700 --> 00:26:49,900
interesting for Consumer
investors to look at.
463
00:26:49,900 --> 00:26:53,300
I think that you're going to see
a lot of companies continue to
464
00:26:53,300 --> 00:26:57,200
raise capital in investment.
Funds are flush with capital
465
00:26:57,200 --> 00:26:59,600
right now.
There's a lot of dry powder, but
466
00:26:59,600 --> 00:27:02,400
I think investors are going to
start to grow a little bit weary
467
00:27:02,400 --> 00:27:09,800
of Raise money on a 20/20 number
that was exceptional growth and
468
00:27:09,800 --> 00:27:14,400
the want to see Ken that growth
rate, be sustained or can those
469
00:27:14,400 --> 00:27:17,000
sales be sustained on a
go-forward basis?
470
00:27:17,000 --> 00:27:19,800
And so that's a little bit.
What we're focused on right now
471
00:27:19,800 --> 00:27:23,600
is we think about New
Opportunities is trying to
472
00:27:23,700 --> 00:27:26,400
follow this, this new consumer
behavior and see what's going to
473
00:27:26,400 --> 00:27:32,200
be on top of mind for consumers,
as we come out of the pandemic
474
00:27:32,200 --> 00:27:35,000
and have some level of a return
to normalcy in terms of
475
00:27:35,000 --> 00:27:38,500
behaviors and activity and so on
and so forth.
476
00:27:39,100 --> 00:27:42,600
That being said, I think that if
as I mentioned his kind of
477
00:27:42,600 --> 00:27:47,900
changed the general behavior of
folks, simple things like going
478
00:27:47,900 --> 00:27:50,500
to the office five days a week,
I don't think foremost is going
479
00:27:50,500 --> 00:27:53,600
to return to that at all.
I think people are going to have
480
00:27:53,600 --> 00:27:57,000
a much more flexible work
schedule and as that kind of
481
00:27:58,100 --> 00:28:00,600
takes shape and everything like
that, you're going to start to
482
00:28:00,600 --> 00:28:03,400
see that those changes in
consumer behavior, and I think,
483
00:28:03,600 --> 00:28:06,700
Going to take a little bit of
time for for folks to settle
484
00:28:06,700 --> 00:28:12,600
into that and see see what's of
importance to folks, and, and
485
00:28:13,400 --> 00:28:16,600
those companies and Founders are
going to have to adapt to those
486
00:28:16,600 --> 00:28:21,200
new shifting behaviors as well.
Hmm, again, very accurate, and
487
00:28:21,200 --> 00:28:23,200
they seem pretty, pretty
optimistic as well.
488
00:28:23,200 --> 00:28:26,100
So on this optimistic note,
we're moving on to the last
489
00:28:26,100 --> 00:28:28,600
question of today's episode,
which is a call to action.
490
00:28:28,600 --> 00:28:31,900
So, Joe, what do you want the
listener to do right after the
491
00:28:31,900 --> 00:28:36,500
episode is over?
Yeah, I think that I think, you
492
00:28:36,508 --> 00:28:41,800
know, the as listeners take a
thought as to what you think,
493
00:28:41,800 --> 00:28:44,800
consumer Behavior might look
like going forward.
494
00:28:44,800 --> 00:28:47,600
Kind of what I was just touching
on in what's important to the
495
00:28:47,600 --> 00:28:49,400
consumer these days.
And how are you going to make
496
00:28:49,400 --> 00:28:53,800
your brand product service,
whatever it is resonate with
497
00:28:53,800 --> 00:28:56,300
consumers.
And so, one thing that I think
498
00:28:56,300 --> 00:28:59,800
about that's on Trend right now
with with consumers to
499
00:28:59,800 --> 00:29:03,400
sustainability and whether
that's as simple as having
500
00:29:03,900 --> 00:29:08,500
Recyclable or biodegradable
zero-waste packaging all the way
501
00:29:08,500 --> 00:29:13,800
down to a product that's cleaner
and better for the environment.
502
00:29:14,300 --> 00:29:17,200
One of our portfolio companies
ether diamonds is making
503
00:29:17,700 --> 00:29:21,200
lab-grown diamonds from air
pollution right now and it's a
504
00:29:21,200 --> 00:29:25,000
carbon negative business and
part of our thesis and making
505
00:29:25,000 --> 00:29:27,400
that investment was the fact
that we believe that the
506
00:29:27,400 --> 00:29:32,000
consumer is Very focused on
sustainability and it's going to
507
00:29:32,000 --> 00:29:34,900
continue to be very focused on
sustainability and making the
508
00:29:34,900 --> 00:29:38,500
planet a better place.
And so I would challenge all of
509
00:29:38,500 --> 00:29:40,900
the founders out.
There might be a little bit more
510
00:29:40,900 --> 00:29:44,800
expensive to to make a
recyclable packaging or
511
00:29:44,800 --> 00:29:48,100
something along those lines, but
and I'm probably not saying
512
00:29:48,100 --> 00:29:51,700
something that folks haven't
thought about but but just
513
00:29:51,700 --> 00:29:55,500
taking a seat back and thinking
about what you're putting to
514
00:29:55,500 --> 00:29:58,800
Market and how that's going to
resonate with consumers.
515
00:29:58,800 --> 00:30:03,400
And And why consumers should be
coming to you to buy your
516
00:30:03,400 --> 00:30:07,600
product or service right here?
And that's very eager.
517
00:30:07,600 --> 00:30:10,200
And also the investment in a
carbon negative Solution.
518
00:30:10,200 --> 00:30:12,500
That's really cool.
Good choice there.
519
00:30:12,800 --> 00:30:16,400
Yes.
My call to action is probably
520
00:30:16,400 --> 00:30:18,600
going to be go to the
description of this episode.
521
00:30:18,600 --> 00:30:21,800
As usually, I'll leave a bunch
of Link's there.
522
00:30:22,200 --> 00:30:25,000
Probably one is going to be
about facts and how those works.
523
00:30:25,400 --> 00:30:28,400
So if you didn't understand the
whole thing, you can read an
524
00:30:28,400 --> 00:30:31,700
article on that.
And also, I'll leave a link to
525
00:30:32,100 --> 00:30:36,900
Jose LinkedIn and probably a
link to catch Ventures as well.
526
00:30:36,900 --> 00:30:40,300
So you might go through it, see
what the investing and if you're
527
00:30:40,300 --> 00:30:42,100
a good fit, definitely apply to
them.
528
00:30:42,100 --> 00:30:48,900
And also Link to something else.
Maybe most likely know they're
529
00:30:48,900 --> 00:30:52,500
going to be three links there.
And yes, my call to action is
530
00:30:52,500 --> 00:30:54,600
going to be.
First of all listen to Joe's
531
00:30:54,600 --> 00:30:57,200
call to action and then check
out the links.
532
00:30:57,200 --> 00:30:59,300
I'm going to leave in the
description of this episode and
533
00:30:59,300 --> 00:31:01,600
as usually have a good day.
