Summary 

What Happens When a Guy with Grit Takes on M&A Without a Giant PE Firm Behind Him?

In this episode, Casey Minshew lays it out—no fluff.

He walks us through his real-world journey as an independent sponsor—finding deals, funding them, and figuring it out as he goes. No Wall Street suits. Just persistence, smart due diligence, and a crew he trusts.

We talk lessons learned (some the hard way), how to avoid rookie mistakes, and why your network can make or break your next deal.

You’ll also hear how Casey’s using tech to gain an edge—and what legacy businesses are hiding in plain sight for anyone paying attention.

If you're thinking about buying a business—or want to raise capital without writing a massive check—don’t miss this one.

Plus, we dive into what’s happening at the M&A Launchpad Conference and how it’s shaping the future of small business ownership.

Watch the video:

 

Listen to the audio:

 

 

Transcript:  

Jon Stoddard (00:11.488)

Okay, welcome to Top &A Entrepreneurs. Today my guest is Casey Minchew from Equity Launchpad. Casey's acquired three businesses. He just announced one just a couple of weeks ago. He also runs Equity Launchpad. It's a conference and, excuse me. Yeah, it's &A Launchpad Conference. And you just started that a couple of years ago. You invited me.

Casey Misnshew (00:37.41)
Yes.

Jon Stoddard (00:39.077)
couldn't come at that time because my wife had surgery, but appreciate the invite. Yeah.

Casey Misnshew (00:43.47)
Man, we're going to have you this next year. We're going to probably be in Chicago in October. We're picking out a date. And then we'll be back in Houston in May. Yeah.

Jon Stoddard (00:51.254)
So let's talk about this as kind of a, you're an independent sponsor, right?

Casey Misnshew (00:59.639)
recently discovered the term and we fit that box.

Jon Stoddard (01:03.294)
Yeah, so that is basically say I'm a funless, no committed capital upfront guy. I don't have a big pool of money to go buy in acquisitions, right?

Casey Misnshew (01:13.676)
Yep, that's it, man. And, you know, it was funny. I went to the McGuire conference in October and I was like, no idea. Just showed up in Dallas, paid the $1,100 ticket price, walked upstairs and I'm like, my God, there was a lot of people here. And I walk over and I did a podcast with a guy named Brian Rand on our podcast. And I walk over and I grabbed Brian, really sharp guy. And I said, hey, excuse me. Can you give me five minutes and just tell me what an independent sponsor is?

Jon Stoddard (01:42.71)
Yeah

Casey Misnshew (01:44.494)
And he told me exactly that I go, think I'm an independent sponsor. he goes, it sounds like you are. And I was like, OK, good. Glad to know.

Jon Stoddard (01:49.408)
Yeah, which means I don't have a ton of money to buy a mid-market deal out of cash, out of pot back. I'm not gonna write a check for that. So how?

Casey Misnshew (01:58.102)
Right. we syndicate. And so my partners, and I'll get into the story here, but we syndicate our capital through accredited investors. And it's a little bit of a hybrid independent sponsor, but it really means we're raising money on a per-deal basis. And that's usually the strategy.

Jon Stoddard (02:18.143)
Yeah, so let's talk about that. How did your first deal go? And I'm looking at the record here, H in the oil industry, right? no, double H services, double H services, yeah.

Casey Misnshew (02:30.434)
Yes, that's so funny. I'm going to throw out some names and I did not do this by design. It's just what came to me. But the first company that... I've been an entrepreneur for 17 years doing startup and I did get an exit in 2019. We sold a platform called Energy Funders and we drilled 42 conventional oil wells. A lot of fun. Raised about 20 million online using the same regulations, the new regulations that had come out.

And we were acquired by a small public company out of San Antonio and it's company's still around today. But at that time I had met a guy who had found a deal in Oklahoma and on paper, John, it was brilliant. was, I mean, it was the best paper deal ever, but I'd never done acquisitions. so unfortunately I did a tremendous, I did no due diligence. did, you know, I did the structure. I could put the money together. I, you know, I got the loan. I knew all that stuff.

but I didn't really do the thorough due diligence. Hindsight, we closed on double H. It was a $5.2 million acquisition. We closed on October 2019, the first, and oil prices cut into negative on October 20th. And I remember sitting there after my wife, because she's got to sign the SBA loan too.

Jon Stoddard (03:55.978)
Yeah, mine's gonna divorce me if I do that again. Yeah.

Casey Misnshew (03:59.382)
man, like she looked at me and she was like, I don't want to sign it. I don't like the deal. And I was like, you don't know anything about this stuff. You know, and I was like, you know, I just sold it. It's amazing, man. Like unbelievable.

Jon Stoddard (04:05.543)
man dude, they have instincts, don't they? He's like, I got blinders on and she goes, nah, I don't like that guy. Something wrong with him, yeah.

Casey Misnshew (04:13.986)
She, yeah, she was like, she didn't even look at the financials and she's like, I just don't like it. And I was like, why? And she was like, I don't get a good feeling and I don't want to sign it. And I said, well, I'm going to sign your name and we're doing it. And she was like, I hate you. We've been married 20 years at the time. It'd been about, it's been about six years. So we're 15 years in and you know, she's like, look, I can't divorce you. You haven't hit your money yet, but I am going to walk out the door as soon as you help sell one of these companies.

Casey Misnshew (04:47.308)
yeah. And she was 100 % right because right after the oil field crushed, I have a picture of me literally in front of the CNBC on the big screen in my house. And oil prices were negative. And I told my wife, said, take a picture. I said, because this is going to be the greatest story I've ever told. And she took a picture. And we still are in business. We're working through our, we take our licks every day.

Jon Stoddard (05:02.964)
Yeah.

Casey Misnshew (05:10.222)
And we're hoping that the new administration will be bullish for oil, even though usually when a Republican's in, oil prices go really low. So we'll just see how that one plays out, man. It's been a tough one. I've learned more about that and about myself and about how to work with people than the other ones.

Jon Stoddard (05:27.527)
What's a tell me about those lessons. Like all of a sudden you're faced with catastrophe and I, like who does Casey gotta be to, to go through this storm.

Casey Misnshew (05:39.67)
Yeah, I think starting up companies, you I've been doing the startup thing since I graduated college in 2000. And I had a job for three, four months. I left, started a business downtown Austin, Texas, failed, and I failed for 10 years. So failure was not, I was not fearful of failure because I had failed so many times. Everything I seemed to touch was just, man, like I was so close or it was almost there or we were too early or whatever it was.

Jon Stoddard (05:45.557)
Yeah.

Casey Misnshew (06:08.416)
And then, you know, I thought that when you buy a company that's already existing, that's been around for 10 years, that did great revenue, had good EBITDA, that this would be the saving grace. I was like, I'll never be in startup ever again.

Jon Stoddard (06:23.093)
Did you ever want to quit? mean, what goes through your head? Some of us, I don't know why I kind of have the same way, cause I'm going to probably work till I die. Like Warren Buffett and Charlie Munger, just cause you like it and you do it, you get energized with it. Was there any point like, I'm just quit.

Casey Misnshew (06:40.374)
You know, I don't think I have another choice, John. I'm unemployable. I don't like being told what to do. You know, I was born an entrepreneur. And so I tried to work for somebody. I tried to have a job. It did not work. So you're kind of stuck when you draw the line, you know, and then you become, over the years, after 10 years, you you become very unemployable. And so you have to figure it out. And, you know,

People are always like, well, what did you do? And I was like, man, I just kept moving my moving one step forward every day. I'm human. was scared as shit the whole time. But you you have to you have to continuously like push yourself. didn't grow up with a trust fund. I didn't go to an Ivy League school. I'm a state school guy and middle class kid. And, you know, if you have big dreams, you just got to put it on the line, brother. You got to go for it.

Jon Stoddard (07:34.229)
Gotta keep swimming, swinging, get your reps in, Yeah. Every day. I like this. This is kind of sound like my story. You know, you want your hearers journey to sound like, well, states, well, it wasn't a state school, but there's any of you and you just keep swinging. You just keep swinging. Yeah.

Casey Misnshew (07:36.78)
That's it every day.

Casey Misnshew (07:50.542)
I met the best friends of my life there and I had so much fun and a lot of lessons in college, had a lot of fun, but I came out a little arrogant. I thought that everything was going to be kind of like easy. And I was humbled for about probably a good 12 years of my entrepreneur career. And that became the low IQ guy that just would not give up. You know, like the rocky story, you like you watch all your...

Jon Stoddard (08:11.817)
Yeah.

Casey Misnshew (08:16.923)
your movies on the weekend that like motivate you to get back out there on Monday.

Jon Stoddard (08:23.615)
The Notre Dame story and all of the Rocky and all those stories. Yeah. Yeah. The Ray Kroc stories and all this stuff, right?

Casey Misnshew (08:28.204)
Yeah, you're watching all the, what is it, the ESPN, the 30, 30 for 30s. Anything to motivate you for Monday.

Jon Stoddard (08:36.213)
Just keep going, man. This is what drives me. Just like somebody winning, whether it's fictitious or not. Yeah. Yeah. So I got to go back to you. Now you graduated with accounting though, right? Didn't you? Like you're a counting guy.

Casey Misnshew (08:40.312)
That's it. That's it.

Casey Misnshew (08:48.662)
I did. Yeah, I went to college, had no clue. My dad said, I'll pay for school, but you get one degree, and it's accounting. He said, if you change it, it's on you. And he said, you got four years. And so I just showed up to class and did what I was supposed to do, but no way, or form did I understand what we were

Jon Stoddard (08:54.963)
Yeah.

Jon Stoddard (09:08.213)
Why did he insist on accounting? Because there's some foresight reasons for that wisdom in that.

Casey Misnshew (09:12.642)
Yes. Yeah, because I've always been an entrepreneur. As a kid, I had the lawn business. The quintessential always was making money. And my dad was like, look, you just need to understand how financials work. And he was like, so do your accounting and that'll benefit you.

Jon Stoddard (09:30.761)
Yeah, especially with what you're doing, right? So what do you think went wrong with the due diligence that your wife saw that you didn't see? I mean, you're still.

Casey Misnshew (09:42.338)
Look, the deal was beautiful. OK? was on paper. I mean, in the structure, and everything was just perfect. What I didn't do was look. here's what I feel like everybody kind of struggles in this process. Because if you're now searching, right? I'm talking to the searchers out there. You've got to become a salesperson, right? Now you've got to be the guy that's an optimist.

Jon Stoddard (09:45.715)
Yeah, on paper. It was like all on paper. Yeah.

Casey Misnshew (10:12.43)
And that optimist, right? As soon as you get the deal, you have to then turn into the pessimist because that's the underwriter. And you've got to convince yourself now, why would I do the deal? Well, I didn't really, I skipped that step. I was like, look, I got the deal. I liked the people I brought on some great partners, right? I mean, all these things I did.

I didn't get into the quality of earnings. didn't go back and I mean, I just did not do those things. And it wasn't because I didn't want to. I just didn't know. I was moving at the speed of light. I was like, let's go like everything else. You know, I'm kind of a ready firing guy, you know, and, and, you'll, I'll figure it out along the way. And, know, and and there's some blessings that have come out of this, man. I mean, that's, it's not a, it's like, if I looked back, I wouldn't be an equity launchpad without the store.

Jon Stoddard (11:03.124)
Yeah.

Casey Misnshew (11:03.438)
because my partners that disrupt equity that back me, they love the story. They love that I'm just pretty honest that, hey, I made some mistakes.

Jon Stoddard (11:12.287)
So what is that? Is it just brutal transparency about like the deals now that kind of drive you or what is it?

Casey Misnshew (11:22.316)
Yeah, I I actually started to subscribe to, I'm brutally honest, to people when I meet them, when I talk to them, I don't sugarcoat. When I meet with sellers, I really do operate from that. I just tell them exactly, I mean, I'm obviously not, you know, completely blunt, but I want to hit the difficult conversations upfront. And I tell people, man, you know, if you're going to do more than one deal, they're all not going to work out.

And I knew going into this that I wasn't going to do one deal and be the CEO of it and turn around and sell it. I wish I was that guy. I really do. If I could go back and like reshape my behavior patterns, right? I would be, I buy a company and I would run that company for 20 years and turn around and sell it. Like, you know, I mean, I would just focus on that business, but I'm not built that way. You know, after 17 years of startup,

you know, understudying as a mentor from a guy that was all about scale, scale, scale. You know, it's just ingrained in me that, you know, okay, now I got one, I've got people, I got to turn it. I got to figure out scale, I got to grow, I got to move. And it may be a little bit of an addiction. It may be a complex, it might be some stuff, but you know, when you do that for like 20 years in startup, and then you come over here, you don't feel like, oh man, that one deal is just right, instead of digging in. So I find people.

to take those positions, I'll take less equity, I'll take less of the cashflow, but I want to put the right people in because I know my behaviors. I'm definitely not the guy that likes to do the same thing every single

Jon Stoddard (12:58.377)
Yeah. What, when did you discover that? Because a lot of us have that, challenge that we don't recognize and look in the mirror and say, you know, this is what you're not good at, or this is what you're good at. And sometimes it takes forever to figure it out.

Casey Misnshew (13:15.074)
Yep. I would say probably around 2014, 15, I was building a platform called Energy Funders. And we had, I it was a zero revenue business. The investments that we were doing are high risk, they're conventional well drilling. And I had to like sit there and say, man, what is the business model? Right. And we spent a lot of time. And what I realized was, is that, you know, I had to recruit people to do the things. I needed petroleum engineers.

Well, those guys were going for two and a quarter in Houston. And man, I couldn't pay more than like 75,000, you know? So like, how do you get that guy? And I was fortunate. I met a guy named Reed Stiles, superstar, wanted to be an entrepreneur. I hope he learned from me. And he said he wanted to be an entrepreneur. And so I showed him some of this, you know, I said, look, we'll trade. But you start realizing like, man, I can't do his job. And then my two partners at Equity Lodgepad were twins, attorneys, and I needed them. And I started realizing like, man,

I'm really good at putting people in place, using those relationships, trying to remove the ego every day to get everybody moving in the right direction. And that's what you kind of learn in a startup and you start reflecting it. Like, what are the things I'm good at and who do I need to put in place that is smarter than me, who is better than me, and that basically understands all of it better than I do.

Jon Stoddard (14:38.037)
Yeah, when you say removing the ego every day, are you saying I'm being one being transparent, but two running the business based upon data versus like.

Casey Misnshew (14:51.394)
think ego, is such a big conversation today. I think more and more people are starting to kind of realize that it's really hard to run and grow a business if you're not completely honest with people, communicate well, and you can't admit fault. And so when I say remove the ego, it's about knowing, hey, this is above my level of intelligence.

and I need to trust those people that are better at these. It could be EQ, it could be IQ, it could be all those things. I just have to be aware of that instead of being like, well, I know everything, which I was in my early years as an entrepreneur. I knew everything, right? And then after 12 years, you get humbled and you realize, you're like, I know nothing, man. I'm like, and if you want to build something great, you've got to get around really intelligent people, And intelligence does play a role in what we do. And I would tell you the team that I'm...

Jon Stoddard (15:35.773)
I don't know anything.

Jon Stoddard (15:44.266)
Yeah, yeah.

Casey Misnshew (15:49.006)
attracting in my two acquisition vehicles right now, I'm attracting some really high caliber individuals. And I could not be there unless I've been humbled for 20 years realizing that I'm just not that sharp when it comes to some of these other guys.

Jon Stoddard (16:00.853)
Yeah.

Jon Stoddard (16:05.225)
Yeah. Interesting. Interesting take. Thanks for being so humble. Yeah. So this first deal that you bought, double H and you bought it with an SBA loan, still own it, right? Yeah. Okay. So what sick, how many, six years. All right. So when did you transition to independent sponsor and not, well, this other second deal, this H and 2023.

Casey Misnshew (16:18.188)
I do. Six years. Six years. We're coming up on six years,

Jon Stoddard (16:35.189)
Did you SBA for that or what?

Casey Misnshew (16:37.422)
Yeah, so I'm going to go a little long here. know you want me to go a little bit shorter on these conversations, but I'm going to a little long. I'm going to tell the hero's journey here because I think this is part of the things that are exciting. So 2021, well, closed on double H. Oil prices crush. COVID happens. I end up getting on the phone with my bank and I'm like, guys, I cannot make payment in May or in March.

Jon Stoddard (16:41.971)
No, no, no, go. Yeah, yeah.

Casey Misnshew (17:06.572)
The guy said, hey, make your payment in March. The government's going to defer six months of your note and pay for it. So just make your payment. You're going to get deferred. And then he was like, there's going to be some stimulus to keep you guys rolling and going. And I said, awesome. I really great guy. I really thought that was great. And I have a great relationship with my bankers, by the way. I call those guys. I update them. send financials because they will help you when shit gets tough. And it always gets tough.

Jon Stoddard (17:15.209)
You like our breathing room.

Casey Misnshew (17:35.212)
And so I was like, man, we don't have any money. Like literally our AR had run out. I had 33 employees in Enid, Oklahoma, and they rely, this is not big towns, right? They rely on this company to feed their family. So I was like, we've got to go into, my two partners at the time, Johnny and Brian, they were like, look, let's go into the trucking business. And they were like, right now trucking is a way we can make money. So over the course of 12 months, I bought

18, 18 wheelers and tractor trailers, we turned into a trucking company and we ran hard in the trucking business and made zero money. It was one of those businesses. But we showed the SBA nothing, but we showed SBA that we can generate revenue and they kept deferring our notes.

Jon Stoddard (18:16.533)
Yes, that's pretty funny. We ran hard, 18 wheels, and we've made zero money.

Jon Stoddard (18:27.881)
You're paying their bills. You're paying their bills. Yeah.

Casey Misnshew (18:29.934)
They're like, well, they saw it and then they would defer and they kept sawing and then they gave us ended up about 18 months worth of deferrals on the SBA note. Problem is when they defer, they continue to accrue interest. They also reamortize and then interest rates happen to start going up right around 22. So that's.

Jon Stoddard (18:49.119)
my God, cause it was at 6%. And so they reamortize to what 10 % or what was it?

Casey Misnshew (18:53.454)
And it, well, we got up to high as 11 point, 11 and a quarter, 11 and a half. Insane. It's insane. But in that journey, I got to 2021 and I was realizing like, hey, if for some reason I go out of business here and I'm toast, I need to, I need to go and find the next opportunity. So I picked up the phone and I called one of my dear friends, Ben Suttles, haven't talked to him in a couple of years, and they had built a beautiful multifamily syndication.

Jon Stoddard (18:58.44)
us.

Casey Misnshew (19:21.774)
about a billion dollars of assets under management. They've syndicated over 300 million for commercial, for multifamily real estate. Call Ben and he's like, oh my God, your ears must be burning. Ferris and I were just talking about buying businesses because we own all these apartment complexes. It'd be great to own our own HVAC, plumbing and all these things. And I was like, now y'all are talking. But it took about a year. So from 21 to 22, it took us a year to get our agreement and create equity launch pad.

And then I went on a search and in August of 2022, I met a man who owned a metal plating facility, one of the largest in North America, about 155 employees, 24 million in revenue. And man, we were like, we hooked, we did it. And I hit it off, we started talking and it took me till we closed May 22nd of 2023.

So it took from August to May, 2023 to get that deal closed. And it was a $20 million purchase, really ended up being about 17 million with some earn out and some upside to the seller. We've been in there for two years. Another incredible, just learning lessons and life lessons and things like that. And one of the things that was really beautiful about that deal was, we kept a lot of the employees.

Jon Stoddard (20:22.729)
Wow. Yeah.

Casey Misnshew (20:47.202)
with that kind of critical mass when you're doing 2 million a month in revenue, you can make some mistakes. You can buy some time. You can hire some good quality people. And we then started to mobilize the business. now we're operating from more of an independent sponsor side because really the size of the business being in that range, what they would call a platform.

which is around that, know, Walker-Dibel did a great presentation at our conference. It was amazing. Just showing about the independent sponsor model. And I was like, man, that's great stuff. But, you know, buying that platform and then building the acquisitions around it. And so right now we built the platform. We came in with teams, brought in an incredible operating partner, did some work. Everything went wrong for about eight months.

Jon Stoddard (21:27.914)
Yeah.

Jon Stoddard (21:40.469)
That's, that's modus operandi for you. It's like, as much as you try, everything is going to go wrong at start. Yeah.

Casey Misnshew (21:47.786)
I'm just telling you right now, John, I've actually, you we've about 40, 50 podcasts ourselves and every single entrepreneur I've talked to says, dude, you're not the only one. You know, everybody goes through all, anything. It's Murphy's law. Yeah.

Jon Stoddard (21:59.798)
You just, you don't see it, right? You don't see, everybody else goes, my God, she's doing great. Like, if I say Cody Sanchez, like she's going great. And I go, no, I knew Cody Sanchez when she worked at that cannabis private equity. It wasn't great for her.

Casey Misnshew (22:16.002)
And know what? Running these companies is not easy. And so you learn in all types of businesses, there's a real J curve. And it's either change management, you're changing too fast, or just really bad shit happens. Like for us, we turned the corner in last year and starting in May, we've got three facilities, about 170,000 square feet of production in three different locations. And our number one producing location, the boiler went out.

Then we ended up having the hurricane in Houston that shut the facilities down for 13 day without power. Still got to pay everybody. And you're talking about $100,000 a day that's going out the door. And then you're free falling. And then that facility, then a lot of the equipment broke down. So we had to come in and do all that work. Man, I felt like I was on one of those roller coaster rides on a pure drop for about six, seven months. But again, the previous

Jon Stoddard (22:57.833)
Yeah.

Casey Misnshew (23:15.392)
adventure startup and all of these things allowed us to not freak out, know, go back to capital partners, raise a little more money, make some adjustments. And, you know, we're turned the corner in the last four months. Now we've had four great solid positive months back on track to where we were when we bought it. And at the same time we brought in a new ERP, we brought in two people to help us run the roll up. And man, we've just had a lot of positive in the last 90 days, but

You know, you're going to have those those seasons where it just isn't fun. It's hard. And you really do think you're going to go out of business. I mean, that that is a that is something you feel. Yeah.

Jon Stoddard (23:54.838)
Every day. It's like every day. Can I ask you, now that you met this syndication and they put money by like a typical cap stack for a, 20 plus million dollar business, what did that look like? I mean, we know that's like senior debt is maybe 50 to 70, and then you got equity 20 to 40%. Maybe you guys put in little money, 15 to 20, and then some seller note. Is that what we're looking at in this deal?

Casey Misnshew (24:23.234)
Yeah, so here's, we went about it, we talked to the seller and he had originally thought his equipment was valued much more than what it ended up coming in at. And so it was gonna just be a standard seller carry, 30 % and a equipment loan to really as your first to close. And then we were gonna raise 20 % of the equity through our partners. What ended up happening is the valuation came back on the appraisal for the equipment way lower.

So we ended up doing a senior note on the equipment. We then leveraged the account receivables for a line of credit that forwarded in cash. Then we had the seller carry. And then we did a kind of like a, it's like a guaranteed earn out. Basically it's an earn out based on thresholds that the seller won't lose, but it's high enough for us to be, he would, he would have to stay in with us and help us get there. And, and that, so we really kind of had four layers of our cap.

Jon Stoddard (25:24.351)
How long did it take to come to that capital stack? mean, you come in with this like, we're going to bring some lenders in, we're going to bring investors in, and that's the purest form, right? But then you realize like, no, that's not going to work.

Casey Misnshew (25:39.278)
Let me give a huge shout out to my buddy, Darren Palastine at Commercial Finance Partners. He is a dear friend. I finance pretty much everything I do through him. Darren and I, man, I work through everything with him and we brainstorm, we think. So I've been able to, myself personally, strategic finance and putting really hard deals together is pretty much part of my background.

And so with Darren and I being able to kind of like run through gaps and be prepared, hey, if the valuation doesn't come back, what's our other lever? What's our other trigger? And so we were able to pace this one pretty well to hit the seller's final date. It was a lot of work, but you know.

Jon Stoddard (26:19.135)
Did you have to change the price on the LOI based upon the valuation of the assets or anything or yeah?

Casey Misnshew (26:23.788)
Yes, we did. We had to come down. That's where the earn out came in, which was we dropped it from.

Jon Stoddard (26:28.585)
And you just show him proof. go, no, your assets aren't worth that.

Casey Misnshew (26:32.782)
Yeah, no, no. So again, going back to my whole being brutally honest, part of the process I do with sellers is from day one. I'm walking and communicating and showing. And I don't do it over a Zoom. I literally met Gary for coffee in Pasadena every week. We had a date. We met, we sat down, we went through everything.

We might have like a week or two that we'd go through while we were waiting for the quality of earnings or whatever it was. But when data came back, he got to see it. We walked through it, and together we put the deal together.

Jon Stoddard (27:11.933)
And he was a motivated seller. He wanted to ride off in the sunset or what was.

Casey Misnshew (27:16.27)
No, no, no. He had made a couple of acquisitions. So he had H &M plating since 1976. His dad had started it. He had ran it. In 2019, acquired a business called Schumacher Dixie, built in 1944. And he had always wanted to acquire it. He acquired that and then he acquired another business called Mirror Industries. And I think Gary just felt like, hey, look, I've gotten to a good age.

and I, want to bring it. want some guys to come in here and help me kind of clean it up, put it together. He stayed with us on for two years. He was an incredible partner. this is his last month with us. but he's on our, he's on our board. We call them all the time. You know, we have a great relationship. And so part of that whole process, you know, just having somebody there to guide us to the process. Now I'm not saying it was easy. you know, you start changing somebody's baby. they do not like that.

I don't care how good they are. And I think we could have done a better job of communicating in the early days what we're going to change and how we're going to do it instead of just going and doing it. Because I think we're

Jon Stoddard (28:12.714)
Yeah.

Jon Stoddard (28:22.131)
Yeah. Were you afraid of what he may say? It's like, no, I tried that or-

Casey Misnshew (28:27.502)
No, John, it's just like, man, it off and go, man. I mean, we're just going, we're working. We're just going at it, right? Yeah, we're going at it. We're not asking permission. And maybe there could have been some more like, hey, this is our game plan over the next 90 days. Get everybody on the board. And the next acquisition I do, sizable acquisition, I'm going to spend probably the first six months educating, meaning going through like, hey, here's what change looks like. This is what we do.

Jon Stoddard (28:33.769)
Yeah, you own it. So yeah.

Casey Misnshew (28:56.684)
This is what, you know, this is our process. Now we created a lot of that processes, you know, doing this deal and now hindsight, they can go back and go, Hey, now I've got a, I've got a plan now of how we'll execute it, but I'm going to get ahead. think communication is so critical. If you're going to keep a seller on, I think it's so important that they understand that. Look, first off, love you. That's why we bought your business. It's awesome. But we.

We have to put our own personality in it. And a lot of these guys never use software. And so when you start bringing in an ERP and software, it's also changing culture. It's crazy, but that software changes how you do shit.

Jon Stoddard (29:38.197)
Yeah, it looks like you're breaking the business. Yeah, it looks like you're breaking the business, but you're building the Autobahn actually. Yeah. Yeah.

Casey Misnshew (29:44.482)
You got it. And we're seeing that now, right? It took six months. The company had never done a price increase. It was all done on paper. The three salespeople were really doing their pricing on emails, no systems. We're now doing it through an estimator. And you're starting to see the company really start to be like, wow, we can make a lot of money here. It just took getting it in, fighting change. We lost a lot of good people, brought in some good people.

And look, metal plating, hard industrial chrome plating, it's not like there's thousands of people standing in line to come work for you. You know, you've got to create a great opportunity for them to come.

Jon Stoddard (30:23.349)
Yeah. Let me ask you about the, deal sourcing and evaluation. Now, do you have a thesis for size of the business? It's got to be in Texas. It's got to be, you know, kind of not replaceable by AI kind of deal. What's that look like?

Casey Misnshew (30:39.854)
Man, I've done all the trainings and read all the books. I've kind of created my thesis around legacy business, looking for something that could benefit from AI but not completely disrupted. But here's kind of what I've been having some fun doing. So we bought H and my partners, Bennett Ferris, were wanting an HVAC plumbing, something around there to benefit the apartments. And I'm like, guys, listen, we found a deal.

Right. Let's not worry about all the other stuff. Right. I'm a little bit product agnostic, but when I bought that deal, it did fit the thesis of recession resilient. It did make it through COVID, you know, meaning it wasn't shut down. It is moded. You cannot just open up another chrome plating facility like ours. You can't afford to buy the equipment. I mean, it's a big capital investment. Heavy assets. So it hit hit a lot of my thesis.

Jon Stoddard (31:30.525)
It's heavy assets. Yeah.

Casey Misnshew (31:36.59)
But we really refine the thesis as we've been going. it's really around at least this roll up that we're doing. We have another one we just started, but this one was really around the circular economy because what we do is we're a job shop. think about Halliburton, for instance, has a big hydraulic or has a big pipe that they want to have chromed on the inside because of fluid. You know, we bring out the big machines, we lay them down. We have a machine that does all the ID work.

and then does the OD work and then we put it in big chrome plating that's 22 feet long, wide, they sit overnight, we chrome them, we polish them and we get them back out. We don't hold any inventory. And so you're really kind of, you're in that recycle world. And that's what I liked about it. We're recycling. And that really did hit one of my thesis, which was, you know, the circular economy, we need to be able to recycle, repurpose and reuse. And if we can be there, we'll be here a decade from now or two decades.

Jon Stoddard (32:34.655)
Did that also include that the asset heavy was being able to finance it through assets? Yeah.

Casey Misnshew (32:41.912)
Correct. That's another great observation. It is like, for me, I like having assets because it's quasi easier to finance. You can get money for it, you know? You're not buying cash flow, you're buying hard assets and you could finance it. But again, like you and I both know when you're hunting for a deal, right? If you're so like, it has to be perfect, you're gonna search for the rest of your life. Like good luck. You know, I've talked to a few people that were like, hey, I found the perfect deal. like, good for you. For me,

Jon Stoddard (32:48.745)
I could find it. Yeah.

Casey Misnshew (33:11.734)
I'm like, go find a great relationship with somebody that I want to do business with. What type of, that means that, you know, the, what is it? The fish stinks from the head down. If the, if the owner is an, is an a-hole, right? Then I'm not going to do business with them. But if he's a good, solid dude that I can talk with or a woman that we can get along with, I can start to understand how the products work. Right. And then I start going the other way. So I really start with that person. Who is that person that's running the business? Because if they're solid,

They're good. They seem to be honest. Then when we get into due diligence, you can tell by their accounting, their ad backs. You can start learning that personality. So when you get down to the nuts and bolts of it, you go, man, there's a lot of integrity here. And I think you have to have a ton of integrity in this business because there's a lot of garbage out

Jon Stoddard (33:57.6)
Were his books clean?

Casey Misnshew (34:03.605)
Yes, just didn't have like a real accounting closing process every month. But when we did the quality of earnings, which he split it with us, he like, I'll split the cost with you all. That really validated a lot for us.

Jon Stoddard (34:17.141)
Yeah, hold on one second, I got some feedback going here. I don't know if you hear it.

Casey Misnshew (34:22.082)
I don't hear it. Do you hear mine?

Jon Stoddard (34:24.732)
No, I don't hear it now. All right. Let me ask you about this point where, was this an off market deal? Yeah. And when was this conversation, how long did it take where, you you plant the seeds like, hey, if you know anybody who wanted to sell, let me know. And you put it through the network and it takes a while to nurture. And I go, yeah, I got a guy. And yeah, I'm interested.

Casey Misnshew (34:32.651)
Off-market deal. Came through a friend of a friend.

Casey Misnshew (34:51.79)
Yeah, so I kind of have a recipe when I'm doing this stuff. what it is is I try to get to a, John, let's just, can we pause once my dog's barking? I don't know if you heard him. That is a Great Dane. He is a 200 pound Great Dane. And if anybody does anything in our neighborhood, barks. I can't stop it. It's just going to be what it is. No, no, he's a big ass. But he's such a, he's a,

Jon Stoddard (35:01.737)
Yeah, you've got a big dog. That is a big vocal cord dog.

Jon Stoddard (35:13.333)
You can tell that's not a chihuahua. Yeah.

Casey Misnshew (35:20.47)
Don't tell the guys that are scared to come by my house, but he's a he's a lovey dog.

Jon Stoddard (35:24.425)
Yeah, we used to house hit a dog, he'd drop off our house. was a Rottweiler lab mix, but it was all black and looked like a Rottweiler. But it's hell attitude was laugh. It was like, hey, what's going on?

Casey Misnshew (35:38.498)
That's Duke. Duke is like Scooby-Doo. I mean, he reminds me of Scooby-Doo. That's why we got him. And that was my thing.

Jon Stoddard (35:47.284)
Yeah. All right. So that conversation you had about the like, yeah, you know, it takes so long. You plant these seeds and you go, all of sudden something came back out in the universe and it took forever, but it did. Yeah.

Casey Misnshew (35:48.654)
Alright, we're good, so let's get back to the question. Sorry.

Casey Misnshew (36:02.796)
Yes. What I did was, is I went out and I told everybody what I'm doing. I said, look, anybody that... Just my network. So I was on the phone with a very good friend of mine, Art, who's been in &A most of his career. And we sold insurance together when I did some PEO sales, which I think anybody that's thinking about getting &A, if you do not have any ability to sell to the C level, that is a great...

Jon Stoddard (36:08.191)
Like what is everybody? it thousands of people or a hundred people or what is it? Yeah. Yeah.

Casey Misnshew (36:32.578)
career field right there. You can make some great money, but you are talking to people in the sea level all day. It's a great place. So I spent four years doing some sales while I was building energy funders and my buddy Art, I told him, said, Hey, here's, here's what I'm going to do. I said, I'm going to go out and buy some companies like double H. And I said, here's my target size. I'm looking between 25 million and 15 million. This is what I'm hoping for. And literally

Six months later, he was like, hey, one of my customers that I sell insurance to mentioned to me he wants to sell. He goes, I think you should meet him. And that's exactly what we did. We went over and we sat down and we got along really, really well. And one of the things I told Gary was, look, I'm not real worried about how much you want for your business, right? I said, but I'm really more focused. If you get your number, I want my structure. And he liked that. He really was like, man.

And I don't know if know Texans, you we all have a way about us. You know, there's a, there's a little bit of like handshake still, even though you're going to do a deal. And so he really kind of liked that gutsy John Wayne kind of feel. And he and I became buddies from that day on because one of the things I learned selling in the sea level and stuff is that you can't be, you gotta, you gotta be pretty confident in yourself, right? You gotta be okay to pull out the stuff up front that no one wants to talk about.

My number one thing now, and even if anybody that I'm going to buy your business, if you're listening to the first thing I talk about is networking capital. I like to get it really uncomfortable right at the beginning and figure out who I'm working with. And Gary enjoyed that, by the way. He liked that. He and I still today are very good friends because of.

Jon Stoddard (38:19.101)
talk about the, untalkable things right up front. Yeah.

Casey Misnshew (38:23.17)
Yes. And I learned that in previous sales and also, you know, anything you read about sales, it's like, you know, the guy that wrote pitch anything. mean, a lot of his pitches are, or, I mean, I love his stuff and Orin's all about talking. That's right. That's right. And it's all about a lot of the, doing the difficult conversations because alphas like that. The other alpha appreciates it. They don't take it as an insult. They actually take it as the kind of guy, guy or gal they want to do business with.

Jon Stoddard (38:31.634)
or in Clath.

Jon Stoddard (38:35.593)
He's Walker, Walker Diebel is working with him now. Yeah.

Jon Stoddard (38:52.287)
Yeah. You know, that was one of the things like I, my CEO of a company who was for Carol bar. She goes, tell me, you know, tell me what can go wrong immediately. Right up upfront. We do with this. I want to know what can go wrong and we're just in software. We weren't like in the military. Yeah. Yeah.

Casey Misnshew (39:09.366)
I don't know, but it's true. Don't you want to know? Think about this for a second. 90 % of the businesses, at least I've read, they die because of a disagreement around networking capital. I've talked to all these guys. It's like, it's always the...

Jon Stoddard (39:26.397)
You always want more as the buyer left in the business. They want less because they think it's theirs. How do you guys like, what's the argument there? You got to show them what it needs per month.

Casey Misnshew (39:38.552)
You know, I had a really good conversation yesterday with a guy I like his business. He wants to sell the inventory outside of the purchase price, but the business requires a lot of inventory. And so I wanted to understand the logic. And I said, look, imagine I went in and I bought a brand new Ferrari, right? And the Ferrari dealership wanted top dollar. I didn't get a discount. I didn't get a bargain, but they didn't wash my Ferrari. They put no gas in the tank, right? And then

I paid top dollar. Well, how am going to get it off the lot? It has no gas in it, right? And by the way, you couldn't wash it. You couldn't clean it up. And I was like, I kind of look at like that as networking capital, right? You want me to pay your top multiple. You want all these things, but you want to take the fuel out of the business because you think it's yours. And I just said, I think it's a very short-term way of looking at selling a business for, you know, $18 million. To me, I don't want to do business with that.

Jon Stoddard (40:38.389)
Yeah. And they leave you at some point they come to a realization they need to leave that in there because that's part of the business. What makes the business turn assets into cashflow.

Casey Misnshew (40:49.228)
If these are first time sellers, right? The guys that built the kind of guys I'm looking for and gals that have been around for 20, 30 years, they've never done this before. They have never heard of it and their broker will not have that conversation.

Jon Stoddard (41:01.567)
Yeah. all SMBs are like that. Whatever's in the cash account or whatever working capital, they like, no, you go borrow at from SBA, replace it.

Casey Misnshew (41:10.988)
Yeah, and that doesn't make any sense for me. So have the uncomfortable conversation up front, And then if that becomes y'all's initial meeting, I had a meeting that was kind fun.

Jon Stoddard (41:22.559)
That, like you're talking about that first. You're saying mention, start talking about that first, right? Yeah.

Casey Misnshew (41:27.522)
Right up front, we flew up to Dallas, Ben Blutin and I, he's our analyst, he isn't with us anymore, love him to death, so we go up to Dallas and he's never done a one-on-one with a seller before and the broker wanted us to come up and meet with him. It was a recycling business, so very low margins, but a very well done business. And so I go in there and I'm like, I look at Ben and I say, hey, the number one thing I'm gonna talk about is networking capital, because I bet he's utilizing cash to buy things and pay people.

and he probably believes that that cash he's gonna keep. So let's have the conversation. So we get into the meeting and within about 10 minutes after we do the hellos, all that good stuff, say, so how do you buy your stuff and how do you transact? Because it sounds like you make a spread when you buy from the junkyard and then you sell it over here. And he was like, that's exactly right. He's like, we have about a million of cash that we keep on every month that we churn as dollars. And I said,

you realize that that is an asset of the business. So when you sell the business, that million dollars of cash stays because that's how you generate revenue. And man, you could have heard it pin drop. It was just like, you know, the broker's like, what are you doing? That's not for this conversation. I said, no, it is this conversation. Because if you don't believe me and if you don't agree with me, like,

Jon Stoddard (42:36.777)
He's like, my God, I just, he's right. I'm pissed.

Casey Misnshew (42:50.84)
we're not, we're having a wrong conversation and they didn't really agree with me. And so we were done. We went back to Houston. But, but I would have rather done that than wait six months, do a quality of earnings, do all these things, spend all this money.

Jon Stoddard (43:02.271)
get so entangled with this relationship and then then have this like you have to cave at some point you feel like you have to cave. Do it upfront. I got you. Yeah.

Casey Misnshew (43:08.632)
mode.

Casey Misnshew (43:13.63)
And I made that mistake last year, I had a really good project that I was trying to close and I fell in love with it. And we ended up burning about 75K in the deal just to do the due diligence and seller ended up walking. And I forgot to put a breakup fee. I forgot all of it, man. I truly was mesmerized by what I was. I was so focused on building the relationship and all this stuff. I made a rookie mistake.

You know, you just mark it up. Luckily, I had some great partners that are like, hey, we'll eat the cost. It's no biggie. But at the end of the day, I don't like to lose. And I did. It's tough.

Jon Stoddard (43:52.598)
Yeah. Let me ask you about something that I just recognized here is your ability to see what makes the bell ring in each type of business. You're looking at, you know, completely different double H is a different type of business and this recycling business. You were able to understand, you know, how the cashflow works and what's important. Where did that skill come from? Just like, I know what makes the bell ring in this business.

Casey Misnshew (44:20.344)
Man, I I consume a lot of data, podcasts, articles, know, anything I'm interested in. I'm kind of a, it kind of sucks being like that jack of all trades. You're interested in everything, you know? So I'm reading like financial news articles. Yeah, but I just love reading. I mean, I pound like five books a month. You know, I'm on the road all the time and I'm just constantly consuming, but I'm also having conversations with people.

Jon Stoddard (44:33.087)
Yeah. He's like, where am I ever going to use this?

Casey Misnshew (44:47.106)
You know, at that point, you know, I knew about the recycling business because our outsource CFO had ran one before. And when I found the deal, I called a few of my partners that, know, like, you know, meaning my, my, my vendors, like, Hey, do know anything about this? Do you know anything about this? And man, he gave me a really good lesson. He said, you need that. He's the one that gave me that, that bullet. And I looked for that anchor when I went into the room to anchor meeting and be able to kind of control the process. And it worked, but it.

didn't work for the deal. That's okay.

Jon Stoddard (45:18.729)
Yeah, yeah. And do you try to save the deal or is it dead like Kevin O'Leary, you're dead to me? It's gone.

Casey Misnshew (45:27.094)
It's dead. Yeah. When it's dead, it's dead, right? mean, and these are all life lessons. You know, one of the other things, John, is I get face to face with these people. So let's just say I'm working through a broker and I talk to the customer. Like if I like the customer, I don't even ask. I may spend five or 10 minutes in that meeting. And then I just say, hey, can I drive out in media? And I just want to get face to face with

Jon Stoddard (45:29.908)
Yeah.

Casey Misnshew (45:51.278)
Because first off, people that are selling their businesses, know, late 50s, early 60s, even 70s, man, Teams is not normal for them. You know, Zoom is not normal for them. You know, if you want to set a meeting with them, call them on their phone. Don't like even me, I'm kind of in the middle. You know, I'm a Gen Xer. I'm 48. And I'm okay if you just call my phone. I'll talk to you. I don't have to see you, you know, and a lot of these younger group.

They like to get you on a zoom or a link or even send you a calendar to schedule your calendar with them. Good luck, man. I'm not, I don't even, you know, it's hard for me. I just don't, it's like, it's the age bracket. And, but I will tell you, know, one of the other things, John, is that, you know, I read a lot of Sims. I like, I'm on like every broker website and if it looks good, I'll get the SIM. I read it, learn a little bit about the business. I'm like, man, that's cool. Like, I like that. And,

Jon Stoddard (46:21.876)
You

Casey Misnshew (46:47.561)
I just kind of collect that stuff. It's fun.

Jon Stoddard (46:50.249)
Yeah, I like reading the Sims too. I always make a comparison. go like 99 % of Sims out there are not telling the truth and you got to verify, you know, but look at an accounting firm that's trying to sell. It's always clean books, they're balanced books, and you know exactly what's going on in the business with an accounting firm Sim versus everything else. It's just like, Hey, you know what? The Sim is going to be different than the QuickBooks files. It's going to be different from the tax returns.

probably going to be different from the bank statements.

Casey Misnshew (47:22.03)
It's a jigsaw puzzle, man. But you know, it's just also I tell young people that are starting to search or considering doing this, you know, that first, know, you don't have to quit your job. You know, go sign up on all the broker networks, start looking at SIMs, start looking at deals, start seeing what you like. What would you be interested in doing? What attracts you? Then, you know, put an offer in and before you even put an LOI in, put an indication of interest or something and get on the phone and talk to the seller because

Learning how to talk to these people is another skill set. And if you're going to get reps and you're going to do the workouts, these are like the routines. so I had a nice cup of coffee with a guy that I met here in the Woodlands that asked me, was like, look, I've been searching for a couple of years, or maybe it was like, he's been searching about six months. He's like, what's your advice for me? And I said, you've got to compress time because these are long cycle projects, right? So if you do not start compressing time in your process,

not without making mistakes, but the upfront. So what I mean by compressing time is you think about it. I get a deal. I worked through the broker. I put in an IOI. I do the analysis, all this stuff to get to where we're going to go to due diligence. Well, some people may take four, four, three, four months to go through that process. Man, I'm going to, I want to talk to the seller day one. I'll put an IOI in if I have to, talk to them. I'm to go sit down and I'm going to get into the, I'm going to talk about the serious stuff right there so I can try to move it to an LOI.

And instead of taking months to do that, man, I'm trying to get there as quick as possible because we'll catch a lot of that stuff in due diligence. It's about, I like the guy? Does he have integrity? Does, you know, does the basic stuff add up? Is it an EBITDA target where I want to be? All of those things to then be able to decide, do we want to do something like this? And so I'm able to get through deals much quicker than others because I'm compressing time. I'm trying to short.

not shortcut due diligence, I've already done that, that does not work, but to short the sales cycle because these sales cycles can go a year, they can go two years. so increase volume, increase deal flow, increase all of those things to really get that momentum. you can...

Jon Stoddard (49:22.25)
Ha!

Jon Stoddard (49:34.954)
Yeah, I think like manage expectations. You know, I don't think you're gonna acquire a $22 million company in three months. Please don't, no, that's not gonna happen. Anybody tells you that, it's great, yeah. Yeah, it's funny, like Gottsman or Woodbridge or, you know, generational, there's companies out there. You can do all that, yeah. Hey, I got a question about,

Casey Misnshew (49:44.75)
But to find it, you can find it. You gotta date it, you gotta sit into it.

Casey Misnshew (49:55.788)
Yeah. And so this last, yeah, go ahead.

Jon Stoddard (49:59.38)
Was there a design or plan on types of businesses like synergy or each one's going to be a platform to, you know, the traditional route of, Hey, let's get this to two to 5 million EBITDA. We'll get some arbitrage and somebody would value this at a higher multiple.

Casey Misnshew (50:06.926)
Good question.

Casey Misnshew (50:17.176)
I mean, it's like everything else, right? You put a business plan together, you put a game, but it shifts, it moves, it becomes something. H was sizable enough to be called a platform, right? It'll do 25 million this year. It has that ability to go to 36 million. We have the capacity. There's a lot of things we can do there to grow it. And then you start defining what are the bolt-ons? What are the things that you want to do?

I speak to somebody in the plating business about buying their business about every three months. So I'm calling them, I'm talking to them, and I just don't know what's going to manifest and come out of it. Nothing's popped yet. And I've been chasing a lot of them for the last couple of years. But we've also been

Jon Stoddard (51:02.045)
You can't really force that, right? I mean, it's either gonna be a bolt-on that fits or it doesn't. Yeah.

Casey Misnshew (51:07.064)
Correct. And you can't make a seller sell to you. I mean, you can do the process. You can try to do what you got to do, but man, you do your reps and you try to get to a no as quick as possible. And that happens. But the other vertical that we chased last year that was we were buying a platform company was in the water business, water and wastewater. It is in Texas.

Jon Stoddard (51:29.514)
Yeah.

Casey Misnshew (51:32.046)
I can't speak for other states, but in Texas, it is a very, very hot commodity in the PE space. And this is where the PE firms are like all lit up around water and wastewater. And so we went into it.

Jon Stoddard (51:44.373)
You're talking about like big lots of acres and cleaning the water and.

Casey Misnshew (51:50.382)
Think about like a town, where we focus is in rural communities, but let's just say the town's like 5,000. And they've got two water wells that are gonna produce for the water for the city, right? Flush your toilet, you clean your water, you get all that stuff that comes back. Those systems break down all the time. Like it's broken down and imagine you can't flush your toilet. Like you're pretty pissed. You're not gonna pay your mud that year, you know?

Jon Stoddard (51:55.701)
It's almost like a utility. Yeah.

Casey Misnshew (52:19.288)
then these muds don't have a ton of money to hire engineers. And so they need good service companies to service them. And so the thing is around Texas, these are a lot of old families and old that have aggregated a lot of these rural markets. Because the big guys in the city can't make a ton of money on them, but a small business that runs lean can make really good living off of them. And so we've been going at that pretty hard for about a year.

year, 15 months, closed on a, what would have been the bolt onto the platform. But now is going to be, you know, it's a good business that we're in. I was able to attract a high quality guy to run the business with me. It's, it's Merchant Controls we just acquired. I was able to get Tom Richardson, you know, 15 years Dow Chemical, Rice MBA. He went on a search, and I met, and I was able to get him involved to run hard in the business with me.

Jon Stoddard (53:01.525)
That's Mercer controls that you just acquired just recently. Yeah.

Casey Misnshew (53:17.528)
We're driving up next week. found another business out in Texas that we're going to go talk to the owner. And then surprisingly enough, the seller last year that the deal died on, he texted me in March and he forwarded me his financials. And he said, hey, had a good quarter. When are we going to talk again? And so I'm taking him golfing on May 30th. And so I'm taking him and his wife golfing at a really nice golf course in Austin.

Jon Stoddard (53:36.287)
Come back around. Yeah.

Casey Misnshew (53:44.942)
So again, like, it's just these you keep, you never give up, right, John? It's like that mentality. You just keep the pipeline going.

Jon Stoddard (53:50.346)
Yeah, there's this cycle. You start off really hot and you hit the biz by seller or whatever it is, broker sites, make some LOIs, they die down and then the deals come back online. Yeah.

Casey Misnshew (54:01.708)
Follow up with those people. If you like them and make good connections with them, don't think that they don't want to come back to the table. There's just a lot of things. And my whole thing is really about just being tenacious. Go at it 100%. Don't look back. You're going to make 100 mistakes. If I can do it, really anybody can. I just think I'm willing to do it more times than the other, right? I think that's my differentiating factor.

Jon Stoddard (54:26.527)
Yeah. What's that cap stack look like for the Mercer controls?

Casey Misnshew (54:31.916)
So Mercer Controls was 100 % financed by the seller.

Jon Stoddard (54:35.557)
Interesting. Yeah. But you could only do that. I'm just like, I want to make sure everybody understands this. Like you could only do that because you got a much better balance sheet. You're not just like not a first time independent sponsor. You're yeah.

Casey Misnshew (54:36.77)
Yeah, I...

Casey Misnshew (54:48.856)
Correct. Correct. And he's 80. And I drove down to Edna. It's funny, Enid, Edna, double H, H all these things float around me. But I drove down to Edna, Texas once a week because Mr. Mercer doesn't do teams. And I sat in his office just to talk to him for maybe 30, 40 minutes. And then I would drive back two and a half hours. So a five hour round trip once a week.

Jon Stoddard (55:13.673)
Well, that's Texas. Every other state you're on the other side of the.

Casey Misnshew (55:16.544)
Since November, I've been doing that. And we built a really good, really good relationship. He knows that I am what I am. I am who I say I am. I will live up to my promises that

Jon Stoddard (55:31.497)
Yeah. So what did that, it's a hundred percent seller financing and that's based on like performance or just the current cashflow. What did that look like?

Casey Misnshew (55:33.294)
And that's a little bit of that Texas.

Casey Misnshew (55:42.774)
Yeah, so the business, here's the thing, the business has services, 150 municipalities between Galveston County. So think on the outskirts of Houston down to Corpus Christi, south of I-10. So these are very rural markets, okay? But they're growing because Texas is growing and they're having to make investments into these communities because water's just, it's constantly got to be updated. The systems have to be updated.

Jon Stoddard (56:00.904)
Yeah.

Jon Stoddard (56:10.941)
And you always need more of it as you grow. Yeah.

Casey Misnshew (56:13.868)
And Mr. Mercer family started Mercer Construction in 1955. Mr. Mercer brought in Mercer controls inside the business in 1965, went to work for his dad, ended up building the business with his dad. And in 1992, he rolled, he opened up Mercer Controls by himself. The construction company is literally a block down the street. So they're not too far away.

But his whole focus is taking care of customers. This guy works. I'm telling you right now, if there was a role model for people to follow, it's this gentleman. They don't make them like my grandfather. They don't make people like this anymore. I'm telling you, it's insane. I don't think the guy's taken more than like 10 vacations in his entire

Jon Stoddard (56:56.745)
Yeah. Did you see that statement? Somebody asked Michael Dell, how many hours of the day works? And he goes, all of them.

Casey Misnshew (57:05.164)
There is just a, see, have to take breaks. I'm, because I get real intense, I'm all in, and then I just got to step away for a bit, right? This guy is consistent. Like he does not stop. And so our biggest challenge is key man risk. Okay. And so this is how the seller financing became the conversation, which is I was like, look, no one knows this business better than you. He's also a genius. Like doesn't have one phone saved in his, one phone number saved in his phone. So he's that guy, right?

You know, just a brilliant, I mean, this guy's got a better mind than most people at 80, right? And he really understood that the biggest challenge was, is how do I replace him? Well, I can't. And what we did is when Tom and I dug in further and further in the business, we realized about 80 % of the business is just blocking and tackling. There's that 20 % that we are trying to figure out. And so we interviewed a guy named Dominic Blue. He's out of San Diego. He's got a really cool...

AI development that he's doing. And one of the things when he was at our conference, we talked about was downloading Mr. Mercer with Plowd, which is a little recording device that feeds right into chat GPT. so Dominic's going to help us kind of take all of that data and really kind of create trainings and manuals. But Mr. Mercer now wears a plowd with him throughout the day. when we do stuff, we're recording them all the time and it's feeding into chat GPT.

And then Dominic's helping us develop that into training and data. So over the next six months, we feel like we can really create an AI version of Mr. Mercer and have all of your FAQs and all of your stuff available for the business. So pretty incredible stuff that's coming. Hats off to you, Dominic. Thanks for that. It's some pretty cool stuff.

Jon Stoddard (58:52.425)
Yeah, that sounds very amazing.

Casey Misnshew (58:56.344)
blew me away. I'm not that smart, but I'm willing to go like, OK, show me, prove it.

Jon Stoddard (59:00.533)
Yeah, how do we get that stuff in his head into a piece of paper or a book so we can recreate it? Yeah.

Casey Misnshew (59:06.594)
just record everything he says. And then you can get that content and you can actually create it to format a certain way. I wish I could tell you how it's done, but I was explained to it twice and I'm like, and where things are going are amazing. so could you imagine, like, one of the things we were talking about is like, could you imagine if Mr. Mercer passed in five years, whatever it is, you literally, one of the customer service reps, when you call in, you could talk directly to Mr. Mercer and he would...

Jon Stoddard (59:17.668)
chat GPT is amazing. Anyway.

Casey Misnshew (59:35.362)
be able to answer all of his own FAQs.

Jon Stoddard (59:38.569)
Yeah. Yeah.

Casey Misnshew (59:40.044)
Wow, like that's the heart and soul of the company is him. So we're like, hey, your key man risk. Wow, how cool is that? Like we could potentially capture all of his information, program it in a way where we now have him as a customer service rep. He's an AI agent.

Jon Stoddard (59:57.962)
No, no, no, I just saw him at the party the other day or something like that. No, no, he's at work. No, no, no, he's answering the chat bot. No, no, no.

Casey Misnshew (01:00:02.324)
never goes away.

He's in, you know what? does that anyways. Like in his life while he's in his prime, that guy did everything. So it's a small business, John. It was not doing a lot of revenue around four and half, four million of revenue. This is one of their best years on pace to do around six, 600,000 even time. And just the business has gotten away from him, right? And he's got a couple, he's got some really key people, but you know, he just.

Jon Stoddard (01:00:29.267)
Any, I'm just really curious. There's no kids to hand it down to? They didn't want to get in the business?

Casey Misnshew (01:00:32.898)
No, I lost his son 15 years ago. So it became, you know, I get it. And it wasn't anything against him. Just you kind of, would, that would knock my sales out for a long time. But he kept working, kept building, kept doing it and a pretty phenomenal business. I bought it because it won his integrity. Like there's not a, like that is like my grandpa. Like just die hard, do what you say, live by a certain way. No question.

And then the way he treats his customers, like his phone does not stop ringing. The problem is he doesn't charge for his advice. So, you know, 40 % of their revenue is just never brought in because he doesn't charge for it. He solves their problems. It could be a Sunday at one o'clock in the morning and he'll get up and drive out and help them fix their facilities, even at 80. So you just don't, things aren't made that way anymore. And so that to me was like, I didn't cure.

about anything else. I was like, if I can take that business and I can put in CRM, put in some software, do these basic things to build, to get that customer list and to get that relationship. And the only thing he really asked of me was to keep his customers as the North Star. He said, don't move out of Edna. So we bought the real estate from him. And he said, and keep my customers the North Star and we can do business together. And so I will live up to that. We will live up to that. Through a referral of a friend.

Jon Stoddard (01:01:52.349)
Yeah. And how'd you find this guy?

Jon Stoddard (01:01:58.528)
Yeah, another center of influence, you say?

Casey Misnshew (01:01:58.922)
I'll be...

Yeah, and it's funny is the guy that I ended up talking to lived two, three houses down from me. We didn't even know we were talking, but he was introducing me to Mercer. So he didn't realize he was Casey, his neighbor, and I didn't realize it was Quentin, my neighbor. It was just in part of the network. And when I saw him at a conference, I looked at him, I said, Quentin, you're not the Quentin I've been talking to. And he was like, yes, that's me. And he was like, I had no clue it was you either. And so it was very serendipitous. It was a very cool moment where I was like, OK, we're doing the right thing.

Jon Stoddard (01:02:28.277)
Yeah.

Jon Stoddard (01:02:31.817)
Hey, I, we don't have a lot of time left, but I wanted to ask you, why'd you start the &A Launchpad Conference? mean, and I, I guess I should have gone last year, but I had more important things to do. Yeah.

Casey Misnshew (01:02:43.086)
Yep. So I'm going to, I'm going to give this to my partner. So I have two incredible partners, Ben Suttles, Ferris Musa of Disrupt Equity. They are my partners at Equity Launchpad. They have built a very successful multifamily syndication company. run it. They've got 5,000 apartments under, you know, that they manage. mean, really sharp guys. And they said, look, there is a really unique time in this market of M &A, right? To create an amazing community. And it's not about what we can sell to them. It's really about just letting them know.

bringing people together, we're gonna make great contacts. We're gonna, you know, it's really about a selfless mentality about helping people. And in turn, because if you help enough people get what they want, right, you're gonna get what you want. So Ferris and Ben were very adamant, hey, let's get the conference, let's put it together, let's go. And luckily they have a team of people that know how to put on a great conference. And Melissa and the team are just phenomenal. And so we did our first year, had about 300 people.

Jon Stoddard (01:03:22.473)
You get with it, yeah.

Casey Misnshew (01:03:37.806)
And I think most people were shocked that there was no guru sales pitches. know, there was nothing like, we kept the prices $199, right? Very easy, affordable. We do a one day. So it's not expensive for somebody to fly in and be there. We try to keep everything where it's affordable. And then we hope our sponsors help us, you know, cover those costs and they do and they get value. then, so we did it then again in Chicago and had a really impressive group of people show up in Chicago and

the second event in Houston, we had over 400 people. was very amazing, it was humbling. And again, we ran some independent sponsor conversation, we ran some ETA conversation, and most of the feedback was, man, this was a great event. People were like, do it today, and we're like, no, we're good with one day, one day's good. It's a lot of information, two days I feel like gets a little long in the tooth.

Jon Stoddard (01:04:28.989)
Yeah. So what are you seeing? I got a question. What are you seeing out there? New things like main shares. I actually asked Judd Goodrich to take my spot. he, yeah. And then SMB investor network, Sam Rosati's just got SMB invest and that there's a lot of this new stuff that's kind of duplicate, duplicating what Angel List does to help with the syndication on that down payment. What do you think of this?

Casey Misnshew (01:04:42.52)
Jets great.

Jon Stoddard (01:04:58.165)
This is way this direction's going.

Casey Misnshew (01:05:00.136)
I think it's great. A lot of people moving in the space. What I will warn everybody, right, is that...

multiples, valuations, and things, because there's a lot of people out there looking for deals, they're getting pushed up. And we got to remember, interest rates are still high. Sellers, you do not overpay, I mean, if you overpay by 50 grand, OK. But if you get caught in a trap of pushing from a four to five times, just remember, it's harder to pay that back. EBITDA is not real. It's not a real number.

It's just, it's what we use to value and do things, but it's, you don't get EBITDA in your pocket. I wish you did. learned that in my first business. was like, hold on, why is that not going in my pocket? But because we're all in the community and we're all wanting it. mean, John, think about it. There is a true transition happening. I we can talk about it all day. We want, we can put advertisements out, but there's literally small business run America. No question. And there is not enough of me and you.

Jon Stoddard (01:05:44.991)
hahahaha

Casey Misnshew (01:06:08.43)
to transition these companies to keep America strong in the future, right? And that's, it's just the fact. And so there's an incredible opportunity for us to find those businesses. And most of these sellers that you're just not gonna work with a broker, they're trying to get their son or kids, or they're just gonna let it go. They're not even gonna really push for it. And there's a really unique time to find that. And I don't think you're gonna find it on a broker network.

Jon Stoddard (01:06:27.017)
Yeah, yeah.

Casey Misnshew (01:06:34.018)
I don't think you're going to find, no, I'm going to, you're going to find some good deals. know that Clint's got Delamity, which sounds like a great platform for deals. Pretty cool platform. You know, I think he's going to do very well. But again, the best deals you're going to find is going into your network, going into your community and talking to people about what they do and how they do it. And, you know, letting them know that you're buying legacy businesses. And I'm telling you, I get in more conversations when I say that it's just shocking how many people want to talk about it.

Jon Stoddard (01:06:40.073)
Yeah, I gotta look into that, yeah.

Jon Stoddard (01:07:02.633)
Yeah, I got to tell you, there was a guy in Wilcox. I grew up in a small town in Wilcox, Arizona, and he owned like all the oil distribution on all these little towns like Wilcox, Benson, Safford, and he owned all of that. he just, no, the kids didn't want to take it. And he just, I think he just like turned it over. I don't know what he did with it, but it was a great little business because he was a driver. Yeah.

Casey Misnshew (01:07:23.948)
Yeah.

Casey Misnshew (01:07:29.262)
Gotta pause. God dang it. She knocked on the door again. This is literally at least three times a day. I don't work from home. My wife does. she's like, it's just someone knocks on the door and it's like, bah!

Jon Stoddard (01:07:32.629)
That's alright. That's alright.

Scooby-doo, Scooby-doo.

Jon Stoddard (01:07:48.975)
I just want to let you know, I'm a good alarm dog. I'm not a good...

Casey Misnshew (01:07:57.774)
We're good. Can you put them outside? Awesome.

Jon Stoddard (01:07:58.611)
All right. All right. So Casey, so thanks so much for spending some time with me at Top &A Entrepreneurs.

Casey Misnshew (01:08:07.138)
John, man, thank you so much. You're incredible. Been listening to your stuff. Keep doing it, man. Help encouraging entrepreneurs and getting them out there. And man, I'm looking forward to having you at one of our events soon.

Jon Stoddard (01:08:17.2)
I'd love to. This time I'll do it.

Casey Misnshew (01:08:20.322)
Fantastic. Thank you for having me.

Jon Stoddard (01:08:21.3)
All right, thank you. Let me stop.