How I Acquired 3 Companies After Leaving Private Equity | Reza Jafer Interview

0:00 Today's guest is Reza Chaffer, managing partner of Second Bite Capital. Reza's career spans corporate and investment banking, ventureback tech, venture capital, and hands-on private equity. At Second Bite Capital, he raised capital in one of the toughest markets imaginable and then acquired and built platforms of operator businesses to motor coach rollup. Thanks a lot for coming to the podcast, Terza. >> I really appreciate it, Mike. Great to great to be here. as I mentioned in our kind of quick chat, we've heard your voice so much. It's just great to actually chat now. We've texted a bunch.

0:39 >> There is there is one tweet you posted on May 29th where you're saying that now you are launching a new chapter as an independent sponsor and I was reading the comments and it's remarkable. You have all sorts of people there. John Gapel, Chris Hoffman, they've been on the on the podcast. Stefan Alman, Dino, a lot of different people. So, my question is how and why so many people are supporting you? That's that's awesome to see that.

1:06 >> I appreciate that. yeah, you know what? I think one of my goals for 26 is probably finding my voice a little bit more on social. I want to build that audience. But, you know, over my last three years or so, I was co-leading Canadian origination for a big private equity fund called Tvest Partners. extremely active lower middle market private equity firm. from my time there, I think we had acquired 136 businesses across the US and Canada in a very short two and a half, three years. And so during that time, funny enough, I was I was on the other side. I was a capital provider actually making inroads with a lot of independent sponsors. And so a number of the guys whether it's on X and I was very committed. I told our one of our partners at the fund I said I'm going to be the first guy to do a deal off of X.

2:00 We came really close during that time but then the opportunity got really good. So I'd actually been pretty working on the background in the independent sponsor universe and was got too excited had to jump on my own again. >> That's that's awesome man. I mean I guess when you post something similar in Europe not too many people will congratulate you because it's I don't know are we built different or what it is but in people in US and Canada and now thanks to Twitter I talk to those guys on day-to-day basis super supportive encouraging so I was just interesting to see that it's yeah it's it's awesome that so many people supporting you that you you're making this jump >> absolutely I was I mean was overwhelmed and the encouragement and support that came through this was was incredible. And you know some of the great guys that have made their voices on on social are are close friends even before I made the jump.

2:56 Jay Jay Vas he's been on there. He's kind of one of my close friends and kind of inspired me to make the jump into a number of years ago. and at Triest I was blessed to also work with Thomas int. We backed up one platform with Open Road Collision Asar Quadradar who has a big presence online as well. We're in the Pep Resort hospitality group backing them. We've looked at deals with Dino and Steven and others as well. And so got to got to see quite a few and and see what they're building on the back end.

3:29 >> Okay. now for those who don't know who who would have supported you if they were knowing you but they didn't back then can you maybe share more of what you were doing before founding second bite capital like giving an overview of who's Resa >> so I'm born and raised in Toronto in Canada all my life my dad was a small business entrepreneur but he I I would say my my my family business or what I grew up in was more of a passionreneur type setup And so that I saw more of the trials and tribulations and you know as kind of being second gen it kind of made me run the opposite way frankly in the beginning. and so when I set out in university, went into finance, got into investment banking. So I was at, I was doing mining, was very much a Canadian ccentric. If you're in Canada, you kind of go through this mining, this tour of duty if you're in banking. And I always worked for really high-erforming teams, mostly international though, from a banking perspective. So I was at our Royal Bank of Scotland until they closed and then MUFG which was formerly the Bank of Tokyo Mitsubishi always building their presences in Canada and so it was a fascinating time after about six and a bit years you know was kind of like right there at VP was I was looking for the growth and opportunity and frankly there I I was getting a lot of responsibilities in banking but it's ended up becoming very hierarchal and and just bureaucratic and so I had seen what was happening in tech. Had a lot of admiration. My goal has always been I want to be I want to be affecting and touching a lot of people, a lot of businesses and made the move into the fintech world. So, I was ahead of growth or head of capital for a ser a preede company called Lending Loop. They're now called Loop Payments. They're very much like the funding circle lending club.

5:23 They were the first marketplace lender for SMBs in Canada. So we went through all the regulatory and it's actually frankly if I trace back where I refell in love with the SMB world. during my three years there we underwrote over a thousand SMBs and that's really where I got to see how much they drive the economy how much they drive employment and also that they can be profitable and sustainable businesses. So a lot of my misnomers and kind of what I grew up I kind of started dispelling that set me off in the in the tech world for the next five years. I got really enamored.

6:01 This was the big craze going on. Became a venture partner with Good News Ventures. They were preed seedstage fund. made a number of investments there. I got pulled at the same time. Co was a crazy time and so this was a big tech. To give you the story March 18, 2020 I was still at my startup. My son was born the first day of lockdown of COVID. At three weeks when I went back the you know lending to SMBs during lockdown in COVID we kind of flipped the business on its head. They've pivoted done well now. but I jumped into the VC world and it was crazy market from 2020 to 22. So both in new formations of startups advising founders there and investing just we saw over 5,000 companies a year. It was pretty insane the amount of companies coming together during that period. I'm a good operator like I like doing I like building but I found it really challenging to be an investor for me personally when I was trying to build like my self-awareness and asking myself the good questions as a venture investor trying to pick 100 xers etc. We can get into that more but I I wanted to broaden my experience to not just see early stage tech and so I ended up joining Silicon Valley Bank you'll see and I was leading fintech and I was a front office so I was I wanted to see tech companies as they scaled so I saw everything from seed all the way you know series C later stage companies and what was really interesting is maybe a quarter of the founders that I was you know backing and and seeing were all very impressive from how they presented, how they led, but only a fraction, I would say, you know, a quarter to a third of them actually understood their numbers really well and understood the business side of things. And for me being a finance guy, it started to just not gel. And when I was looking for the next opportunity and my timelines are getting a little blurred, but I started getting I started seeing what was happening in ETA, you know, X and Twitter was the community was really starting to come together.

8:02 Like I said, I had some friends like Jay and starting to talk about what they were doing as independent sponsors. And so, right around the time where SVB collapsed and blew up as the same time where I acquired our first platform called go for career and it's a B2B last mile delivery career service helped set up professionalized pretty quickly. It was a very lean team. the operator had moved out of state or out of province, wanted to transition, but really really great little business. And about 4 months in, we were already starting to look into our next platform actually because my wife had stepped in a little bit on that one, was trying to work on it, and I was going to work on others.

8:44 And that's where I I got I got approached to co-lead Canada for Tvest Partners, the Miami based private equity fund. They've been around for 40 plus years. Today they manage over $7 billion and very very inquisitive. so like I said, I think 136 companies in that two and a half three years. So it was a phenomenal run. we we finding both platforms add-ons they were they were very hands-on investor for the most part as well even for their size and scale they had a you know 13 14 person value creation team that was really really exciting to work closely with as well and so was loving my opportunity but it was seeing that more and more I mean there's an old adage that Canada is 5 to seven years behind the US frankly I'm in my backyard I see what's happening the bar for big funds kept going up in terms of size of deals etc. and I saw the opportunity that just kept coming and you know hitting me over the head back here. and so earlier in May, to your reference, is when I spun out or resp-pun out again as an independent sponsor to close.

9:56 And I was fortunate that at the tail end we had a, you know, what's great is if Canada's 5 to seven years behind, then I can already just look down south and what my portfolio is already doing at TIVAS and bring a lot of the thesises north. and so we kind of left with a thesis in hand. and we're got under LOI pretty quickly on these two motor coach companies. A lot of people thought we were crazy because the world was blowing up. We also were trying to close simultaneously to create our platform.

10:28 So we had two businesses and pulled it together frankly and then August 29th is when we officially closed that platform. So, we closed on Great Canadian Coaches and Holidays and Tisdale Bus Lines, and they created the platform Fortress Coach Partners today. and we just closed our latest add-on on Christmas Eve and called Air Coaches. and so today we have three businesses strong. we're already top three operators in Ontario. Our aspirations are to double the platform and expand across Canada and then go into the states as well. and yeah, and we're I can talk a little bit more about how we got to the partnership as well, but there's there's kind of four of us close friends working together as partners. we have a couple new platforms in the works as well, mostly thesis driven. We're really excited about 2026 is hopefully going to be a big year.

11:28 >> Excellent. Thank thanks for the overview just for me and to others to understand the timeline. The first business you bought back in 2023, right? >> Correct. Yeah. >> Could you share more about this deal because the first one obviously it's very special one and you you you you just very casually went through it but can you share more details like how did you do it? Where were you financially? How were you able to put it together? who you did with how did you find the deal and all this exciting and interesting part which a lot of listeners will find valuable.

12:01 >> Happy to. So through my career and especially in banking I kicked off I mean the Canadian market we've been very real estate you know focused. The real estate's done really well here. I was fortunate to make several of real estate investments through my you know early career as well. So I had some money some access to to capital. But in terms of raising capital, I know I had done it for a fintech, but in the concept of a business acquisition, didn't have the best network at the time. What was interesting is I had already been part-time searching, self-funded searching, but I was working full-time.

12:36 So, I was just evenings, weekends, looking at opportunities constantly. And at that time, there's a couple brokers here and there, but if you're not in that world, a lot of what I was looking at was online platforms, right? I was looking at the biz buy sells even the flip and I was like what can I do you know ourself and funny enough this business actually was on one of the online platforms but what I noticed what was different is I think I want to say it was flippa at the time actually that this business we acquired flippa gets a lot of in a lot of eyes from US buyers and US companies but this one being a Canadian business didn't really get looked at and a lot of The things on the platform were ecom, SAS, digital businesses. This is a tech enabled service business. So, we actually don't have a physical location. We don't own any vans, trucks. They're all independent contractors.

13:32 So, yes, it's technically a digital business, but it just didn't get the attention there. And, you know, at first I was looking at I'm like, okay, I'm I was sitting on it, not seeing it, and I just realized like people weren't seeing the opportunity here. and I got to post a couple questions, had a Q&A with the owner, got to meet him, and I was like, "Okay, actually, this guy's motivated. There's an opportunity." My wife was a wedding and event planner for over a decade, and she was always in her vehicle running around grabbing things, and she had a whole network of people that she could automatically sell services to. So, there was actually kind of a a life synergy that we thought through as well on our side. When we made our offer, I mean, it was very much a owner operator.

14:19 I mean, rough financials. Couldn't even do a real QOE at that time. I mean, I had to get bank statements. I I can tell you I also didn't know what a QE really like the effect how it was. I was like, I was a banker. Let me go look at this and underwrite it myself. And again saying that he was motivated, we ended up getting it for about one and a half times cash flow, not even dot cash flow from last year. So very attractive multiple. And then from a structure side, I said, "Well, here's what I can I can give you 40% now.

14:52 how about you finance the other 60% and I'll pay you monthly over the next 3 years." And he said, "Well, that works for me. It's that's great." He didn't ask for interest rate. And so it actually was, you know, there's no interest rate baked in. We just paid 60% monthly. Now, it's I mean it was a pretty aggressive VTB. We had to take that out, but from a structure standpoint, it actually worked out well. So, the other 40% between our cash and funny enough, because we had some real estate, we had access to lines of credit backed by our real estate. So, the true leverage is quite a bit higher.

15:26 But, that's how we made the financing work for that first acquisition. Let's take a quick moment to mention our sponsor Capitalbat. Well, if you're listening this episode with Reso Chaffer, it's all about the shift from advising and investing to actually owning businesses. And that's exactly where Capitalbad fits in. Capitalbat gives investors access to private operator acquisitions of real cash flowing small and mid-size businesses. These are founder and family-owned companies entering their second phase of growth. backed by operators with real skin in the game. So, if you're an accredited investor looking to deploy capital into durable businesses with aligned incentives, thoughtful structures, and long-term ownership in mind, capitalbad is worth a look. You can learn more at capitalbad.com.

16:21 I'll also put the link in a description. That's capitalbad.com. And now, back to the show with Reza. why he was willing to sell the business if I may ask and such a such a healthy terms. >> So we're on the we're in Eastern Standard Time right now. he had already moved to the West Coast and so Pacific Standard Time. So his day instead of starting at 7 7:30 was now starting at 4:00 4:30. and just he was ready to move on. He needed liquidity. He wanted to he's a very much like a founder where he's already ready to the next venture. He was ready just to like get liquidity, put it into this new business. They they've moved and started like ice cream shops and a whole bunch of stuff out there. He had jet powered surfboards. So like very much entrepreneurs, you know, founder type and the business frankly was sitting. It wasn't getting the attention. He didn't hire a a broker cuz I think he probably obviously could have got more structure, more terms. but he he thought he can sell it himself and so it was kind of an opportunity for us as well. So as you bought it in 2023, it's January 2026 now. So you're the payment is almost done as I understand.

17:32 >> Yeah, exactly. June June this year will be done on the seller note. >> So you bought the business. How much work it required from was it just you and your wife or some other partners as well? >> No, at the beginning it was just my wife and I that said we're going to jump into this. you know we had a little bit of family money but it really not from an operational standpoint was the two of us. You also have to maybe remember at this time SVB had just blown up or was in the process of blowing up and so my workload from there had pretty much dropped off cuz everybody was just in a standstill and they were going through the process unwinding liquidation. we had, you know, restructuring firms and lawyers and everybody. And so it was actually to your point about how we financed it, it was also this weird tricky thing, but very fortunate for us.

18:28 We were still getting paid, but not really working. And so I had consistent cash flow to be able to still start do this. So I I knew that wasn't sustainable forever, but it got us the opportunity to really kickstart early on. Now during our diligence we identified there was a really really strong you know customer service head a lead who when we asked her you know what's your capacity do you want to take on more and she just lit up and said I would love to do more really excited about this company what we're doing yeah and we talked about okay what about dispatch what about driver management what about this and she just kept saying yes yes yes and over time we identified that okay she's the person so we've elevated her to effectively GM of the business. She's now runs the day-to-day.

19:16 And what was really helpful is having her to take the operational side of things. It really helped us focus on professionalizing and just making SWAT small tweaks. Frankly, in the beginning, what's been fascinating is like the last owner wouldn't for any corporate accounts that came right now, what they would what they had done is said you had to pay before you had delivery of services. And, you know, you can imagine for bigger businesses, they sometimes need, you know, monthly terms, 30-day terms, etc. And he just wasn't willing to float anything. So, they were turning away a lot of business. right now because we had a little bit of float. We said, "Okay, let's evaluate, but if they're good, you know, customers that we think that can be reoccurring, happy to offer 30-day terms." And that right away increased this whole corporate channel that she just have to keep turning down. That frankly increased significant in the first 12 months. It added significant revenue and stability to the business. Okay, that's interesting because many guests once they bought the first business, they go and try to buy another one. But what you did, you probably got an offer from Travis Partners and you decided to go and start investing in in businesses instead of buying it yourself. So what is the what is the story and timeline there and how did it actually happen?

20:34 >> Yeah. Yeah. So we bought kind of early 23. We had checked, you know, so I had bought this right around when when Trius or sorry, when SBB was blowing up and it was probably about 6 months or so before the Triest story started really picking up there. And that was enough time to professionalize, elevate our, you know, customer service person into GM. My wife was stepping in a little bit there. And the nice part about that business is we still do very little to no like next to zero marketing and the orders just keep coming through. so it is a pretty nice little resilient business.

21:14 We had to tighten things up here and there but it didn't take a whole lot of time operationally. Now if we want to significantly grow it and we do have aspirations we know we have to spend more time and attention but the base wasn't falling out from under us which was really helpful as we were and we started looking at other acquisitions for it and started looking at other platforms. I was still relatively unknown as a name, as a potential buyer with credibility in the market. And when when Tribes had approached me, seeing what they had done, what they had accomplished, building off their presence, it was it turned out to be correct where it was an absolute to give you the best. I would call a banker before and say, "Hey, I'm Resza Jaffer calling from nothing. It's me personally. I'm looking to buy something." I wouldn't get a call back or you know, it's like, "Okay, great. Let's chat with you." My criteria was all over the place before. Now going to Tvest, I can guarantee you I got a call back every single time from every banker, right? Because, you know, we have capital, committed capital, we want to deploy, we bought 65 to 70 companies a year. I was getting call backs and so from a just and it was the first time frankly where I finally got to blend what I wanted to do all day long with all my personal time. I blended those together. So my full-time job was searching and going out for businesses, learning about businesses, structuring, analyzing and building ecosystem.

22:50 And so it really was I mean it was an opportunity I really couldn't couldn't turn down frankly. And you know I was co-leading Canada for them. It was a fantastic opportunity. So, Trius kicked off in 23 as well and about I I I believe I started August 1st if I'm not mistaken and it was really hit the ground running. We were I was at Meguire Woods that October talking to independent sponsors, you know, just building the ecosystem tons. I was running to all the ACGs across Canada and the US going to Dealmax in Vegas and not only my brand, but I was building Travis's brand at the same time. I always, you know, really put them put them ahead of myself, but naturally because I was out of market as business development, you know, I people were understand like seeing me more. They were seeing how I was interacting, how I was coming off got to be in a lot of those process and how I would lead them too. And so my natural credibility with those bankers, brokers, lawyers, everybody in the ecosystem started to get built at the same time there. We ended up closing two platforms, a number of add-ons that I led as well there. And yeah so it was it was just a fantastic run with them.

24:00 >> But personally where were you? I mean 2023 you had just bought the business now you worked for a firm and you were just doing the work which was like like a play for you. You really enjoyed doing this. On your mind did you have this idea of you would like to buy a business yourself as well or you just forget this part for some time or how was it? This was all always in the back of my mind where I always wanted to build and buy and build. I, you know, again, Red Walker's eyeballs, buy them build. And for me, it was the Pandora's box. I couldn't unsee.

24:34 But being at a shop that, you know, it was the exact shop that I wanted to be a part of where they did, we had three distinct teams. It was business development, so it was purely origination, deal team, and then value creation, portfolio support. getting to spend time with all you know I was business development but getting to spend time with deal structuring and value creation team it just really accelerated my lens and helping you know hone down criteria helping to analyze businesses why yes why no there was just my learning during that period just shaved off years that I'd be going at it myself and this is where when I talk to a lot of searchers today that are either bankers or operators there's anybody not PE there's you can tell sometimes that there is a a difference in like a PE mindset versus not. And that's not a not a knock on anybody else cuz they're super strong in other areas. It's just there's a a formula for private equity that you start learning and you start getting good at and it can be very bene beneficial when you're out in market and seeing tons of new businesses. How do you sift through them quickly?

25:47 >> Okay, we will cover the second deal very soon. But first, could you cover something you because you've seen both sides. You've been the capital provider and you've been the one chasing capital, raising capital for your own deal. So, not too many people have had this experience covering both sides. So I'm more curious about the side where you worked for Travis Partners like what did you take from from this experience when you went and tried to raise capital for for your own deal? It's it's it's a very loaded question but maybe there are some parts which are like obvious which you would like to bring out. I'll tell you one thing that's a the hardest part about once you start getting into committed capital family offices once they start getting big and they need to dep they have a need to deploy capital distribution becomes their bottleneck and deal flow and that's where the dirty secret today of even committed funds will I mean Tribus has you know yes they have an independent sponsor page whatever they're they're at a lot of these but they ever advertise to their LPs that they work with independent sponsors a lot, right? Because that's what they're getting paid for. And I'm sure every other committed fund, that's what they want to do. That's how they build their support their big BD teams as well, right? Is that they're going out and getting the deal flow. But this is where independent sponsors are an avenue for distribution and thesis driven and just getting that expertise in certain areas or uncovering deals that they're not getting to see. and roughly 20 to 25% of the annual platforms that Trius was doing was with backing independent sponsors.

27:26 And that for me was a, oh, this is like a real channel. I saw independent Meguire Woods continuing to grow year after year. and seeing the appetite from family offices to deploy from committed funds to get to start making connections. It really is was like legitimizing this independent sponsor space and making it a real thing. But I think that was probably one of the biggest learnings for me is even though we have all this capital, all these people, you need deals and you need to understand them. And it was interesting to see Travest recently just announced a platform backing an independent sponsor in early education childhood. They've been looking in that thesis for I mean since I joined or more two years 3 years but either couldn't find a deal that fit them didn't understand it enough. Now they obviously have a partner who's gone in done it and and is kind of shephering the thesis right and that just makes the whole thing work. One more quick pause here to mention our second sponsor, Space Bar Studios. If you're listening to this episode with Reza and you're thinking, I need a reliable way to stay top of mind with my customers and sell more of what we already do. You're probably describing a newsletter. Because as we head into 2026, the smartest channel you can build isn't social. It's the one you actually own. And that's why today's sponsor is Space Bar Studios. They help operators, investors, and builders launch high-quality newsletters designed to compound over time. If you're ready to get started now, they'll honor your first 30 days free, so you can kick things off risk-free. And here's the bold part. They also guarantee a minimum of 10,000 subscribers in the first 90 days. There are no long-term lockups either. So, if you want compounding asset that builds trust the way great businesses are built, go check out Spacebar Studios. That's spacebarstudios.co.

29:32 I'll also put the link in the description again. Spacebarstudios.co. And now back to the show now. And what is the how is the timeline between you working for Travest and you finding your acquisition number two? So, how how did you make it happen? And could you elaborate the fundraising process as well because again you were doing it during the pretty tough times let's put it in this way. So, interestingly, the way that I got into this thesis is Travis got into this thesis down in the States last year into the motor coach space and they were one of the early ones into the space and got to see the dynamics there, why we were doing it, where the market started to go in the US and how resilient and how interesting these businesses could be. Everybody just thinks them as moving teams or schools, etc., But behind the scenes there's actually a quite a high amount of of contractual revenue there that and corporates are attracting you know new employees and retaining them for not just as an employee perk but also as like safety and you know whole another measures. it it made sense to to make the jump once the conversation started advancing more and going out honestly the fundraising time was insane. We sent out our first deck to investors and it felt like the next day Trump had announced tariffs on the whole world and Canada was about to go the 52nd state or whatever. And I was like, "Oh, well there goes my deal."

31:08 And went back to the wife and I said, "I'm sorry. I don't know what I just did. I decided to leave this fund for this crazy dream and I think I think we're going to it's going to be a little bit shoddy. We're going to have to eat some craft dinner for a little while." And it was really interesting because a lot of my relationships just given the firm I was with were in the US and so I went out to a lot of capital partners in the US and it was the I we got the more to be expected. People were talking about heavy asset, capex, intensive, these are motor coaches and I understand that. And then we started hearing some interesting ones and from a few investors where because of the uncertainty people were talking about even FX risk. It was the first time in decades I had heard FX risk and at the time CAD was 147 something like that.

31:57 We've gone back to our normalized times but there was so much volatility uncertainty at the time it almost froze deal making and especially anything crossborder which was you know under an inc heightened lens. So that was that was quite challenging in in that in that time. All a lot of our leads were coming out of the US. Even we had great relationships, good intros from people. but people were kind of frozen and especially there was a segment of our business which was holiday travel from Canada into the US and that business pretty much closed overnight. They did a good job of rotating to like promote Canadian tours and which has helped bolster some of that demand. But that was a that was a really challenging time. We had to pivot to capital providers out of Canada or global and that frankly was a little bit we went to some of the usual suspects but the big checks that we had needed were we were a little bit hardressed to find. We stayed resilient, went out and it came our lead investor came through a cold email of all things which was crazy. They're on the their family office of gentleman named Wes Hall.

33:11 Their family office is called We Shall. Funny enough, he's a dragon on Dragon Tank Canada. so he's really successful entrepreneur and their managing partner came across our email thought it was really he thought it was intriguing and called us in for a meeting and which was crazy to us. we ended up going four or five times back to their and we got on a Zoom meeting and it was it was fantastic. They're great partners today. and during that time also we got introduced to the largest motor coach operator. They're second generation familyrun out in a different part of Canada. They had seen these deals, but they're hands-on operators. They weren't coming into Ontario. And we really clicked with the the CEO over there, who's the the son of the original owner. They got really intrigued by what we were building and they said, "Listen, we're we we don't want to operate this, but we want to be close and we think we can add a ton of value." Having them as the operational side has shaved off months if not years of our learning value creation playbook. it's been phenomenal of building this very strategic board now where we have a financial party who's very well connected to the business ecosystem. can make all these intros to corporates and having an operating or very strategic partner who's not going to be competitive but is just opening up every door and knows this landscape twice over. And that's something that we we're thinking very carefully about future boards now with our platforms is bringing in people that are very close potentially even strategic actually write a check into the deal as well. So I didn't want to interrupt you when you were laughing about this period when the tariffs and things like this happened, the tough times, tough periods, but how did you sur survive this? I mean the day-to-day the stress you felt because you quit your job being the father being a husband having all this pressure on you as a man in a house. how was the dayto-day and how you thinking back how did you survive this part? because you were making some jokes here as well. I can I can say you look a bit older now when I look the older pictures. So how how was it for you and how did you overcome the the dayto-day week to week?

35:36 >> yeah, very stressful like in that time where we just get either no responses or nos. But I will say everybody we ended up did that we spoke with didn't say that we had a bad deal. They said for some reason it may not be a fit for them, but everybody said it's oh this is this is interesting. We knew we had a really good structure. We had a really good business that was swinging and so we just needed to fix and tell a better story. That was what we kept coming back with is like we need to keep iterating our story so that we can say the best thing because we know we've done this in a good way. My partner on the deal is, you know, exclave, ex banker, like he has a couple platforms. Super smart guy.

36:22 We we're also, you know, it was interesting. People were diligencing us as well, like how are you guys going to do this as partners, your different firms, etc. We had a tight story there, but we just every time kept getting iterating our story and how do we get tighter on this and very much was like, "Okay, great. One no, totally understand, but this was from venture days. I know how many nos you have to go through." And I was like, every no is just one closer to the yes. And I just we just need to keep going. Balancing that with managing the live deal and process there and racking up bills and all that. That was definitely getting hard. We were fortunate. We had really good partners on the QE and legal side that have done work in this space with searchers, independent sponsors and understand, you know, that they're backloading their fees or they're going to, you know, roll some of those if things break like we we were very blessed to work with some good people there. And I I think to your point, one of your questions that you had sent over is what would you do, you know, what would you different or how would you see the nuances? One thing that we didn't grapple with because this was our first time raising for this size of deal as well. the deck even we had shared with you we were raising we very much had an LBO style deal which was you know put in a good size but almost like the mi I want I don't want to say minimum but we put in you know quasi minimum amount of equity right and maximize the amount of senior leverage. We also are very fortunate where our big banks in Canada come all the way down to lower middle market. So we have a full sponsor package. We have very attractive debt terms u which is very different than the US and even parts of Europe as well where we have a very robust lending system. Plus we had equity rule from two selling parties and three general managers that never had equity. They were very excited about getting equity for the first time. We had seller notes in there as well. So we had a really good structure. When we went outside of Canada, everybody said, "Oh, either this is not enough for us to deploy and it got into a deployment game where, you know, oh, sorry, our minimum track size is actually more." I was like, "Well, we can take more. We just have to, you know, we just have to take less leverage and that's totally fine. We can do that." But we didn't grasp the difference there. We ran it as pure LBO model and that mark that system that model really works in Canada because the depth of capital isn't as robust here for equity.

38:53 But doing this again and especially because this is a rollup a lot of funded sponsors Canadian or otherwise are still doing deals in lower middle market because they're going in 100% equity 100% equity so they can go fast and they can execute rollups so they can deploy capital and once they get up to that 7 to 10 million of IVITA then they go recap put on leverage get us you know get a senior lender for our next platform which we're you know hopefully going to be in market in Q1 with that's what we're going to show as well. We're going to go in very overequitized so that we can go to some of the bigger players and attract bigger capital providers to come in and and go all equity so we can actually execute and efficiently.

39:34 >> And now today when you look at the portfolio you are at you said biggera level what's next? Is it like a buy and build and hold or or or sell eventually? What's what's the thesis? >> We're just getting started which is so exciting I can tell you. So, there are two initial companies, Great Canadian and Tisdale, just closed Air Coaches on Christmas Eve. Once you synergize that, it'll be incredible. we're just getting started. This area is really interesting because there's still a ton of fragmentation. It has all the classic characteristics of a rollup.

40:10 Aging founders, there's some really interesting tailwinds specifically here in in Canada for the industry side. especially regulatory where this area the licenses used to be regulated in Ontario and during COVID became deregulated and so there's a lot more opportunity for for new contracts and growth there's also new entrance but getting started is hard and so we're already starting way ahead and any of these little guys that end up getting anywhere they just become our picking grounds I see a if we don't double and then some the platform in our hold period of call it 5 to seven years, I would think like we didn't do our job right. We there's a pipeline both organic and inorganic to more than double this platform. And then the goal the the idea is still probably like sell or recap in five to seven years is probably the idea.

41:04 >> And personally, you are you finally full-time now or you're still thinking of maybe going co-leading some USB firms in Canada or full-time finally? >> I I'm full-time. I'm fulltime. very excited to be very and frankly very very fortunate and blessed to have done a deal this size where even to myself and my partner can take full-time salaries as like our management fees are enough to cover that we don't I think one of the hard things is I see a lot of independent sponsors when they do spin out from their old firms when they get a 2 to 5 million IBIDA company it's a fantastic start but when your their management fees, it doesn't cover their full previous salary, they're already on to the next deal because they need to just build in their base layer. And so, even since closing to now, because that pressure is off, my growth in terms of firm building, going thesis driven, building real relationships and certain things, I've felt my own when your patience increases, my focus can also increase at the same time. So I feel like it's already provided a lot of benefits for me personally. I'm very fortunate for that.

42:18 >> That's great. T Reesa, I'm sure a lot of people would like to maybe have some additional questions to you because you have very interesting journey and story because you've seen again both sides. So where can people find you if they have some additional questions? >> Yeah, for sure. X Resa Jaffer LinkedIn Resa Jaffer or my email is rescenby capitalap.com. would love to chat with anybody in the audience or anybody thinking about this. Yeah, we're going to be active this next year and beyond. I'm super excited to talk to anybody in this in the space.

42:53 >> Awesome. Thanks. Thanks again for doing this and very excited to have another let's call it part two at the end of the year or in the beginning of 2027 to see how many add-ons you have done. Let's do it. I'm super excited to chat and thanks so much for again for your support and encouragement through this process. >> I hope you enjoyed this episode of Buyers and Builders. Please remember to subscribe wherever you're listening and leave a review. It really helps the show reach more buyers and operators. And if you already haven't, go back and listen to some of the other episodes of Buyers and Builders. This podcast is built for people who buy, build, and hold great businesses long term. Every guest you hear on this show has real hard one experience acquiring and operating companies. And the goal is again very simple to give you ideas you can actually use in your own journey.