The Exchanges

Q executives, and professionals who are actively looking for tools and services to help their business grow. If you want to put your brand in front of this highly dedicated audience that's difficult to reach, I'm currently looking for a few strategic partners for the channel. To learn more about sponsorship opportunities, click the link in the description. Let's grow together. What kind of structures are common in pre-IPO secondary deals?

A There's a wide variety. So one of the main differences to public investing is in public investing, you can go on your Fidelity app, type in a ticker for a company, and it spits out an offer for you essentially. In the private markets, you could have for one company five or even more different sellers, um, different prices and different structures. And there's also new structures being innovated all the time. So some of the most common are direct transfers of shares. That's where the investor holds the shares in their name and it's blessed by the company and goes through their review process. You also have SPV transactions being extremely common where essentially it's a dedicated fund that holds the shares and the buyer is subscribing to the fund as an LP.

AI assessment note: “some of the most common are direct transfers of shares”

Q How can you model what that value looks like when you're talking about like construction, manufacturing, whatnot?

A Yeah. So there's usually a very good opportunity to help the company slash the customer understand your business case. I come from that world. I'm a non-technical founder, and when we work with our customer, we sit down with them. We look at all of their workflows, processes, and we do an AI potential analysis, which says, hey, if we do these five things, we can save you X amount of hours. You can reallocate your industrial engineers to actually meaningful work. We can reduce your failure rates. Humans make mistakes. AI can be better in certain things than humans. Not in everything, but in certain things. Um, and then the other thing is, can we generate more revenue because the AI takes action on certain things where humans are the limiting factor? So these three things usually drive a potential value of the system. And if we say, Hey, we think that value is a million a year. Our price tag is somewhere between 15 and 25% of that as an annual license. So 150 K to 250 K to generate a million in annual value.

AI assessment note: “we do an AI potential analysis, which says, hey, if we do these five things”

Q Was there ever a moment where you felt like the business was done?

A Not this time around, but in 2019, yeah, there was. Um, I think this was March 2019, and I was very much contemplating, I've been doing this six, maybe seven years at the time, and it was my first time through the ringer. It was my first time seeing my supplier who I relied on and who had been reasonably good up until then, just fall to pieces. And to give you an example of how bad things got, on, on one trip over there, I had to go around with With my engineer, and with another guy, and we went to all the suppliers, and I paid them cash. I was running to an ATM taking out cash to pay these suppliers in Eastern Europe. So that we could bring back the materials, the raw materials needed, the wood, the glass, the steel, the locks, bring it back to the factory so that they could complete orders because the suppliers weren't willing to deliver anything to them anymore because bills hadn't been paid in months. That time around, I very much thought, okay, maybe this is the end. What flipped the light switch for me is in the midst of this, I had a call from a, uh, a security agency for a foreign government, and we started a G seven country, and we started talking about projects for government, for their government residences. And that was a wake up call to me, because just at the time where you're at, Your lowest of lows in terms of not knowing what the future is going to be. All of a…

AI assessment note: “Not this time around, but in 2019, yeah, there was.”

Q Do you think e-commerce brands are generally good at managing their expenses?

A It really depends on who you talk to, right? In general, so if you talk about brands that are doing five million and above, or let's say five million to ten million, they are okay at managing their expenses because they've gotten to that stage. Anything over ten million, it really depends on the operator. I've always seen it that it's hit or miss. Some operators are Uh, very, very good, and then some operators are running like a 15% OPEX, uh, which is very bad. I mean, e-commerce, you should be sub eight percent at all times, but anything under five million, it's usually very bad, and that's why you see all these small SaaS businesses where it's like profit calculator apps on Shopify, um, you know, forecasting tools, Inventory control tools and things of that nature. It's when these brands haven't built these systems internally.

AI assessment note: “anything under five million, it's usually very bad”

Q What else have you seen that is something that would cause someone to not get the deal done?

A The first thing we see most frequently Uh, is that, uh, when someone calls us and they want to say, Hey, it's time for me to sell my company. My kids don't want to buy the business. They don't want to be in the business. And it's tough for me to get out. Um, the first thing we see that is going to make the company unsellable or take a really long time is they have terrible accounting. If they have any accounting at all, it's amazing, uh, how large your company can be. And they don't do any budgeting. They don't do any regular monthly, uh, financial reporting. They essentially do what's called checkbook accounting, where they look at their checkbook. If they've got enough cash in there, then they pay their bills. And that's, uh, frequently, I did a, a, uh, turnaround on a sixty million dollar fiber on C three that made five million dollars a year for the charity. And, uh, they really had no idea what their, Uh, cashflow was what they're forecasting was. They've never set a budget in 30 years. So that's a fairly common thing. The second thing that we see most frequently is a business where, uh, the company is either completely or almost solely dependent on the owner of that company for its ongoing operations and success. And, uh, most times those companies don't get sold or if they do, the buyer's going to require the, Owner to stay on board for probably an extended period of tim…

AI assessment note: “the first thing we see that is going to make the company unsellable”

Q What should someone do if they want to prepare their business to be sellable?

A Well, the best thing to do is not to just wake up one morning and say, that's it. I'm done. I'm selling. Because they usually need, uh, ideally they need a runway of a minimum of a year and two to three years is usually the case. As we talked about, there's a lot of issues around owner dependency. Uh, if they can identify and have a succession plan in place where they have a number two individual that they can make sure they're trained, they could step into their job. That's going to make the company more, more sellable. If they work with accounting professionals, Uh, in this day and age, you can hire a fractional CFO for very little money who has tremendous ROI for, uh, in value creation for getting the accounting in shape. Uh, many companies have, uh, one of the other key criteria that we see that's, uh, debilitating for company sales is customer concentration. If you have, uh, more than 20% of your business is dependent on one customer, That's, uh, for, for private equity buyers in particular, if the company is big enough to be acquired by a financial buyer, that's one of the first questions we get asked when they call us about a company we're representing and they're automatically out if it's over 20%, or if they have two clients that maybe represent 40 or 50%, that's a tremendous risk factor for them. So if you can evolve the company, make sure you're maintaining your gros…

AI assessment note: “ideally they need a runway of a minimum of a year and two to three”

Q margin is lower because the founder is taking money from the business. So should, is this something that's understood and like, don't worry about it or. Is this something that the founder has to be very careful to manage so that as they're approaching the sale date, they take less money so that the profit margins look higher. I mean, what is, what, how does that kind of thought of?

A We see a lot of business owners that don't really understand that. So the majority of companies in the U S today, smaller companies in particular are structured as either S corporations or LLCs. Being taxed as an S corporation. So, uh, the business owners generally take a market based salary. So if they're in an industry where just hypothetically, uh, 200,000 dollars for the size of company and industry would be, uh, a normalized, uh, compensation for a CEO or owner of a company, then that's what they take. But at the end of the year, Because they're a pass through entity, they take a distribution for the remainder of what is considered the profit of the business. So that doesn't really impact their income statement or delete their profitability. Uh, where they run into problems is when they need to bring in a manager or promote someone to be their number two for succession planning purposes, they have to pay that individual more money. And that, by definition, reduces the amount of profit available for a distribution to them that you're in, which means effectively they are reinvesting in the business and reinvesting in their future in terms of what value creation and how sellable their business is. So the ROI in a longer term is much better for them than it is to not make the investment in a succession plan.

AI assessment note: “take a distribution for the remainder... doesn't really impact their income statement”

Q Do you have a morning routine that you use that gets you psyched for the day that allows you to come with the energy that you need? Probably a non-stop energy for the, the hours of the day that you're working?

A Yes, absolutely. My, my day is fairly non-stop, uh, handling a number of different things, but, uh, yes, I actually exercise every single morning. I, basically the first thing I do when I wake up is I, I'm either out for a run or, or in the gym hitting the weights, and I try to do a pretty intense workout for 30 to 45 minutes. And then, uh, I do have a sort of zen period of 30 minutes before I actually start my workday. I'll, you know, take my shower, make coffee, uh, sit on, and just take a moment to reflect before letting the, the speed of the day kind of Come at you, and I think that really kind of grounds me and centers me and keeps me focused on the top priorities.

AI assessment note: “I actually exercise every single morning. I, basically the first thing I do”

Q So you were saying off air that team building has about eight or 90 people. Is that between, uh, those, um, other companies that are under the umbrella as well, or?

A So it all operates as one company now. So yeah, the employees are our collective group. And I believe right now the number is 90. Uh, we have, uh, full-time staff who are the sales team, marketing, uh, customer service, et cetera. And then we have, uh, all of our event hosts. Almost all of them are part-time. There's a few that are full-time, um, but all as employees. Uh, and we're somewhat seasonal as a business. So for example, quarter four is quite busy for us. Uh, as companies are not just doing team building, but they're also doing holiday parties, and so we'll bring on seasonal staff, which pushes us up to more like, uh, I think it was one 80 last year, or almost 200 even, uh, with more hosts, more, more support staff, et cetera.

AI assessment note: “it all operates as one company now. So yeah, the employees are our collective group.”

Q Or having to make that switch over. What is the timeframe for like doing all of this? For example, let's say you have, let's say you have 10 pages and you want to switch over. Um, and let's assume you have Figma files that you can work with, which we do. How long does it take? How long does it take on average?

A Yeah. So based on that, I mean, it can take from three to six weeks. I mean, sometimes up to three months, depending on how, uh, how large the feature set is for the website. But let's say the most basic website you can develop and QA it properly, like an agency, like in-house in just three weeks for, let's say, 10 pages. And that's where the most of the, of the speed of Webflow is coming from. And, and that's kind of honestly my biggest problems with the agency. Uh, because with WordPress, you had long development times, you had maintenance, and then you can kind of scale the agency pretty easily. Whereas as we are here kind of just on a runway, like the longest client is around three to six months. Like that's, that's the longest client amount. And then you're just kind of crushing out items, uh, which is fun for developers and designers because they can always build something new and just kind of get stuck into that repetitive process. But then in the end, it's a little bit scary just because you don't have a lot of secure cashflow in the end.

AI assessment note: “it can take from three to six weeks. I mean, sometimes up to three months”

Q know that you're involved in aviation and you run a group of companies. I'm really excited to hear more about how you got started with your first company and how you eventually developed a group of companies so that people can understand what it's like at that scale. So thank you again. Why don't you tell everyone a little bit more about, uh, your group and how you got started?

A Thank you, Sean. Thanks for inviting. I'm really excited to share my, my experience and what actually I achieved with my group. As you maybe heard, and we had a chat before I I'm born in Georgia, uh, and then graduated from one of the technical university there, uh, moved down to London, uh, did my master's degree and, uh, started my career as a broker to selling charters for the client from small office in London. Later on, I got a couple of offers to join operating companies in UK and start to look after The commercial part of this business, uh, bringing some more clients, uh, down to the AOC in UK. After five years, uh, decided to move on and start my own business, you know, from the management company of the aircrafts as an asset. Then I set up my brokerage company in London, in Malta. And later on, I've got my AOC, uh, where I put the, all the aircraft, which were under my group's control. Later on, we had some other, uh, divisions like fuel and handling. Then I've got, uh, also the dealership for the Honda Jets, uh, in former Soviet Union countries. And in 2019, we decided that we should go digital and we set up the company called Mirai flights, which today presents service to book your private jet or any jet, which you would like the same way as Uber or Or any other least or any other companies who provides mobility service. Today group consists of three. Divisions. One …

AI assessment note: “started my career as a broker... After five years, uh, decided to move on and start my own business”

Q over 12 years. Join us every week to fast track your personal growth so you can meet the ever-increasing demands of the company or companies you are passionately building. Time waits for no one, so let's get started now. So thank you for taking the time to talk with me. I appreciate it. Why don't you tell everyone a little bit about yourself and what it is that you do?

A I've been into an entrepreneur for the past, I guess, uh, 20 plus years from a very early stage starting opening businesses for the past 10 years. I've taken it, uh, professionally started, uh, by working in a venture capital fund. Then for the past, uh, nine years, I've been opening startups in Israel, had five, uh, startups. Uh, one acquisition, uh, by Symantec, uh, for two hundred and fifty million dollars, uh, one IPO in the London Stock Exchange, uh, for a hundred and fifty million dollars, another startup in the antibiotic sector, uh, that raised about forty million dollars up to date. My, uh, latest venture is Anchor, which we raised fifty million dollars and we're building autonomous building and collection platform to help small businesses Literally automate their billing, collection, and payments, uh, efforts all around the board.

AI assessment note: “My, uh, latest venture is Anchor, which we raised fifty million dollars”

Q So then what VR use cases do you see that are out right now that excite you?

A I see a little more in VR. I've made two investments. One of them is in a company called Trip. Which is basically doing a meditation app in VR. And one of the reasons I made the investment, I mean, they've got a couple 100,000 users. I think they're the number one meditation app on, uh, Oculus. Uh, one of the reasons I invested, first of all, Nenea, who's the CEO is amazing, but they had done a test, an AB test of, 20 minutes on headspace versus 20 minutes on trip. And they showed roughly a 35, 40% Increase in HRV, which is a measurement of how calm you are using trip versus headspace. And when they dug into the physics and everything behind it, the bottom line is when you're listening to Headspace, you're basically listening to audio only, a guided guy in your ear. When you're in VR, you've got video and audio cues. You've got some motion going on, on the screen. And by engaging more senses in your body, you're able to calm yourself down quicker and more effectively than using audio only. As a prompt. And they had a study that actually proved that. So then I said to myself, oh, here is something people like to do meditation, which is quantifiably better done in VR. So that's one. The second VR investment that I've made is a company called Morpheus XR, which is an enterprise company doing its own virtual world and a bunch of meeting related stuff and activities for the enterpri…

AI assessment note: “One of them is in a company called Trip. Which is basically doing a meditation app”

Q track your personal growth so you can meet the ever increasing demands of the company or companies you are passionately building. Time waits for no one, so let's get started now. Welcome back to another episode of the We Love To Build podcast. I'm here today with Ray. So why don't you tell everyone a little bit about what you do right now and how you got to this point?

A The short of it is I work at home in my Superman pajamas and I have been doing so for 15 years. The long answer to it is I bootstrap seven-figure online businesses. Um, we own a website called LiveLingua.com, which is the third largest online language school in the world. My wife and I bootstrap that. I run a software company called PodcastHawk.com. Um, we have some pretty well-known people in the podcast space who are involved, like Pat Fling. I was an advisor and a shareholder in that company. For those of you who listen to a lot of entrepreneur podcasts and I've owned a chocolate factory in Asia for a while. I had a marketing agency for a few years. I'm a software developer by training. I quit my job, my six figure almost software engineer job to work for the Peace Corps for a 150 dollars a month. So I've done quite a few little things, but yeah, generally I'm at home in my Superman pajamas.

AI assessment note: “The long answer to it is I bootstrap seven-figure online businesses.”

Q So you've mentioned a lot of specific types of data, like the number of cars being purchased in China or something like that. How does a company get that sort of information to begin with to then be capable of putting it on a marketplace to sell?

A So there's a lot of companies where their core focus is selling data. So they may get that data through an arrangement with someone who's producing it. They may get it by just web scraping. Web scraping is an enormous industry. You know, there's literally dozens of companies that scrape used car prices. They scrape listings. They scrape airline ticket prices. You know, every couple of minutes they're scraping restaurant reservation. And then, so then you've got companies where data is an exhaust of their core business. So think about the credit card companies. They're, they're seeing every charge that you make. Uh, they're not in the business of selling data, but they may partner with somebody who does, and they're very sensitive about specifically what they license because they don't want to break user trust. You know, then there's You know, other things like just a process. So think about imports. So any container that comes into the United States, there's form filing requirements that have to be done. All those forms are digitized under the, I believe it's the Freedom for Information Act, and they're publicly available. Granted, you have to buy them from the government, but they're, they're part of this process that's sort of built into something. And similar processes exist in areas like, imagine You're doing renovations to your home. You have to file a permit. Permitting o…

AI assessment note: “They may get that data through an arrangement... They may get it by just web scraping.”

Q Isn't there a way for the Chinese government to fudge the ship data coming in and out of each port?

A It really depends on the source of the data. So some sources of data can be more easily manipulated than others. So there are what are called bills of lading. So these are the government documents that get filed when a ship Comes into a country, leaves a country. Could those be manipulated? Absolutely. Then you have forms of information, uh, such as AIS data. So every ship around the globe has, you know, think of it as a collision warning system, a ship to ship communication system. And these are reporting the locations of the ship, the name of the ship, and this is all over the globe. Fudging that is very challenging, right? Cause you see the ship, the government doesn't really control the AIS beacons. And it's so far removed from something like GDP. But if you know what you're doing, you can piece these things together and start to come up with pretty interesting metrics. So, you know, things like satellite imagery, we're taking images of factory. I talked to a company yesterday that they, they take satellite images, they compute the volume of cars, the volume of people at a factory and how it's changing over time. Very hard for the Chinese government or for any government to manipulate those images Over a long period of time, right? You have to know exactly when the satellites are going to fly overhead. People are changing which constellations of satellites they use. That wo…

AI assessment note: “It really depends on the source of the data.”

Q Sorry, go back to the next part of the process of like you're at, they are reviewing the decks and thinking of these conversational questions, things like that. So what, what happens after that or what else are they being taught to look at?

A Sure. So the first thing we do is document review and then we'll consider those deals for a couple of weeks. We'll have a number of conversations about them, and then we're going to vote, and we're going to decide that we're going to move a certain number of them forward. So this year it was 30 companies, so we try to get 24 to 30 companies, and then we invite those 30 companies in for a three-minute pitch, and we do a little bit of Q&A. We go back to the documents, look again, see if some of our questions got answered, and some of our concerns have been alleviated, or if now we have new ones, and then we do that same process again. We'll talk it over for a couple of weeks, Then we vote again, and then we go down to sometimes 12, sometimes six, but we'll bring the, the next round of companies in for what they considered like a full pitch, like 10 minutes plus Q&A, and then we picked six, and when we get down to the six, what we think are the six companies that are the most investment worthy, then we start spending a lot of time with them. So the first meeting is the founder, and they get a team of eight or 10 investors, and they get three hours together. For the first meeting and then site visits and customer calls and really digging into the financials and meeting some of the rest of the team. For the final six, there's a very involved process of getting to know those six comp…

AI assessment note: “So the first thing we do is document review and then we'll consider those deals”

Q Now, I remember when I was going through my shareholder agreement with my lawyer, he told me that some things should be in the constitution and then doubled up in the shareholder agreement, and some things should Not be in the constitution and only be in the shareholder agreement. Can you speak to that?

A There's the shareholder agreement, which is a contract. And then there's your policies and procedures or your constitution or your bylaws or whatever you call them, the set of rules by which you operate, which are something else, which is a living document, which can be amended. And that second document is always attached to the shareholder agreement, whatever its most updated version is. And what needs to be in the shareholder agreement are the things that are absolutely not Going to change. And what needs to be in the living document are the rules as they exist as clearly as much as possible. You know, the things you want to protect yourself are probably going to be in the contract, but most of the actual rules about day-to-day operations are going to be in the, in the constitution, as you put it. How people vote is always going to be in the constitution and bylaws. The fact that shareholders We'll get a vote proportionate to their investment might be in the shareholder agreement, because you're guaranteeing that they have voting shares. Or if they don't have voting shares, that would be in the contractual agreement.

AI assessment note: “what needs to be in the shareholder agreement are the things that are absolutely not Going to change”

Q Seems like intelligent as an end result, especially because being from America, I know just how ridiculous patents can be, and, and the court process, and people basically suing each other over basically nothing, so I'm really glad to know that our DNA is protected if it's not manipulated. Let's go back to the, the main point, which is what is a patent?

A Well, a patent is actually a form of property, and that's one reason why these fights have been so fraught. Patents are the only legally permitted monopoly right outside of, say, highly regulated utilities. Patents enable the patent holder, the patent owner, to block others from making, using, selling, attempting to sell, importing, exporting, etc. Everything that is protected by that patent, the idea. Patents protect technology. So they're a form of property which is meant to protect technology and encourage innovations in the technological area. So examples of technology might be software, hardware, but also small molecule drugs like normal pharmaceuticals, aspirin, proteins like antibodies. Methods of producing things like new ways of three D printing, for example. And patents were intended to encourage the innovators to share their ideas with the world. They first got started at a time long back in history when many innovations were held by guilds. They're kept as secrets. They wouldn't be shared with anybody. And then if the guild members died as was happening, for example, during the plague in the middle ages, suddenly those secrets are lost. Quickly governments realize this is a bad idea. We have to encourage sharing, but if innovators shared, they said, well, we're afraid if we share our ideas, how do we know someone won't just steal them and make off with them and all …

AI assessment note: “Well, a patent is actually a form of property”

Q What is the right time for someone to consider bringing in a fractional if they can't afford someone full time?

A Yeah, great question. In my experience, Fractional can work all the way up to about 20 to twenty-five million in annual revenue. Anything above that range in our experience, the idea of fractional starts to spread too thin. You really need a full-time operator at that scale of a company. You've got sizable operations, sizable team. The idea of fractional is just going to be tricky. Um, at a starting point, I would say at least to be at a million or more. Right? Low multiple seven figures. I know there's a lot of companies out there that are trying to break that seven figure threshold, uh, and we applaud them and celebrate them, but they often say, I want a COO, but in reality, you don't really need a COO. What you really need is just to do more of what you're already doing. Maybe you need a online business manager or an ops assistant or, you know, project manager. Um, but for companies that are at low multiple seven figures up to about twenty million, fractional works really, really well in terms of just the business size. In terms of when they may feel like the need is there is usually when they've realized that when they've been trying to grow and scale and it's not been happening fast enough, right? It kind of feels like they're pushing the, the boulder of their business up the hill and it's getting bigger and heavier. And it just feels like there's more effort. The day to d…

AI assessment note: “at a starting point, I would say at least to be at a million or more.”

Q So how do you build your agents? Like you're using NADN, using Make, Zapier, like, cause there's a lot of these different platforms out there. And I feel like they all do the same, but I could be wrong.

A Our team grew up on the Microsoft C-sharp background. And so they're in that world, that Microsoft world, and they're building these agents on top of those frameworks. So the agent SDKs that Microsoft produces, uh, and allows, and a lot of it is being built. From the, from the ground up using those baselines that Microsoft provides. A key part of what we do is we integrate into the Microsoft Office platforms in the Microsoft M. Three six five platforms, because that's where, let's take a law firm, they want to operate. So we have a very Microsoft centric engineering approach to, to building these agents and deploying them as well. Um, what's been interesting with that is, you know, We see Microsoft's co-pilot out there. We also see a huge use of, uh, Claude, legal specific tools like Legora and Harvey, some of these big names that are out there as well. So while the actual core capabilities are being built with the Microsoft frameworks and the SDKs in the background there, obviously MCP is the thing that's, you know, putting that out there and making this accessible to everything else.

AI assessment note: “building these agents on top of those frameworks. So the agent SDKs that Microsoft produces”

Q So What was a typical cycle for the start to finish of one of these processes where it was human to human, where now, like to now?

A So back in the day, and this is still today, but back in the day, a system like Sapariba would produce an Excel spreadsheet That Excel spreadsheet would be sent to another, to the, the selling human to complete that and then send back. And depending on the complexity of that RFP that's received by the seller, it could take anything from two weeks to six months for the seller to complete that RFP. Again, depending on, on complexity, typically three to four weeks, uh, of cycle time there. In a energetic world, that process happens straight from the sell, from the buying platform to the selling platform. Selling, the selling platform does a bid no bid. Like, do we really want to do this? Is this in our wheelhouse to do it? Have we won this before? Qualifies in or out. It qualifies in, goes ahead and answers majority of the baseline questions. Now it can, moves past the first gate. Now we're into the high value discussions. Around the more kind of strategic elements of that, of that RFP.

AI assessment note: “typically three to four weeks, uh, of cycle time there.”

Q network, generate over fifteen million dollars in revenue for my businesses, and fundraise over eight million dollars for my businesses and my clients. If you want to build relationships that work for you before you need them, go get this guide right now. The link is in the show notes. Okay, let's get back. And so what happened? Did you get another chance to present, or was that deal dead?

A Yeah, it was an industry event. I had many opportunities after that, and actually that That propelled me to an event where I got rid of a presentation altogether and did it all from the hip, and it was extremely successful. So it's like you take one horrible experience in your life and say, wait a second, I've been up there with no preparation, no material. I'm going to speak exactly what, and actually it was the time that I was, it was in Atlanta. It was a mobile industry event, and I was overhearing the British Telecom's, the mobile network in the UK saying, hey, listen, I need to get Prepaid services by Christmas. Otherwise, you know, in the shops, otherwise I'm going to lose my job as CEO of BT Cellnet. And then the, and then the CEO of Phillips saying, Hey, we're the new, we're making phones. We're the new manufacturer out there. If I don't get all these phones sold and in the stores by Christmas, I lose my job too. So I was selling patented rental systems. So I got on stage. I saw the two CEOs in the audience, big audience. And I said, I knew technically I could do this. I presented a pre real-time prepaid service and said that I could have that integrated and available in 60 days. Never been done before in the world. So after, they got me right away and said, Travis, can you do this? I mean, of course I can. Call my twin brother. Go to Stanford Library right away. There'…

AI assessment note: “I had many opportunities after that, and actually that That propelled me to an event”

Q Do you have control over how you present these opportunities to the investors you work with? Like, are you, are you choosing to push direct sales or do you like SPVs? How do you, how do you do this?

A Because I'm a broker and not a financial advisor, I'm not a fiduciary and it's, it's not within the scope of my role to give financial advice or to push one structure or one deal versus the other. My job is to help source offers, to help the buyers to understand one versus the other, to be strategic, and also to help them negotiate and smooth that deal through to closing. So I try and be as upfront as possible in presenting a deal to try and anticipate some of the questions or, um, uh, give, give all the facts up front basically. So we usually look at price. We'll obviously look at the structure of the deal. We'll look at the timeline that applies to that deal, maybe the, the loose profile of the seller in the early stages where it's anonymized, um, domicile is important to some investors. So is this maybe a U S focused fund that's selling and all of those different features as well as any fees that might apply. And then also my fee that might apply. So they usually get bullet points to start that outline those main points of the deal. And it's really important that the investor knows that they are in the driver's seat and they need to decide ultimately what deal they want and what they're comfortable with.

AI assessment note: “not within the scope of my role to give financial advice or to push”

Q So you said the word inventory, and I wanted to focus on that real fast. When you mean you have inventory, does that mean you have shares that you're in control of, as in you're acting as a principal rather than an agent?

A No, my firm itself doesn't have inventory per se, but there are, there are many different sellers in different situations. So there are some deals where I might have a live seller at that point in time that the buyer comes to me. Um, you know, if someone comes for Stripe, I may have a Stripe seller at that exact moment that has existing shares of Stripe that is, is ready to transact right away versus there are some, we have to be more strategic about, um, like a company where maybe there's an upcoming round and we might be able to, um, get an allocation that's roughly at the same time as that upcoming round. So there's times where we plan ahead and be strategic and there's times where we have something ready to go. As my seller is actively looking to get liquidity in that name at that time.

AI assessment note: “No, my firm itself doesn't have inventory per se”

Q but you also just said, if you know, another round is coming up. So what's the difference in that? Because when someone says they're pre-IPO, I imagine either they've filed their S-one or they are planning on filing the S-one within the next twelve-ish or 18 months. Like, And, and I guess, how is it differ between the, the round, you know, uh, the round and the pre IPO placement?

A Pre IPO is that kind of sweet spot between true venture capital, that early stage investing and public market investing. So it typically refers to ultra large Venture backed companies that are at the stage of maturity and scale that they could go public if they wanted to. Some of them in the next one to three years, um, some of them sooner, or they may have filed for IPO, like you mentioned. Um, but whether or not they do IPO, they are just of that profile and scale that they could. So until recently, for example, SpaceX was a company that had been quite vocal through Elon about not wanting to go public anytime soon. And so a lot of us thought SpaceX could potentially be a much longer horizon, um, to going public based on those comments. Now that's changed with the suggestion that they could go public sometimes in, sometime in 20, 26. Um, but for a long time, SpaceX was a name where people were thinking even more long-term than normal. On the other hand, you have companies that have been more vocal or actually put into place the filings to go public. So companies like Discord, um, I believe Kraken as well, and, and some others. So there's, um, there's a real variety of different timelines in terms of going public. And just because it's a pre IPO company doesn't mean we know for sure what its timeline looks like. You equally, you have companies like Turo Which have been on that,…

AI assessment note: “just because it's a pre IPO company doesn't mean we know for sure what its timeline looks like”

Q executives, and professionals who are actively looking for tools and services to help their business grow. If you want to put your brand in front of this highly dedicated audience that's difficult to reach, I'm currently looking for a few strategic partners for the channel. To learn more about sponsorship opportunities, click the link in the description. Let's grow together. What kind of structures are common in pre-IPO secondary deals?

A There's a wide variety. So one of the main differences to public investing is in public investing, you can go on your Fidelity app, type in a ticker for a company, and it spits out an offer for you essentially. In the private markets, you could have for one company five or even more different sellers, um, different prices and different structures. And there's also new structures being innovated all the time. So some of the most common are direct transfers of shares. That's where the investor holds the shares in their name and it's blessed by the company and goes through their review process. You also have SPV transactions being extremely common where essentially it's a dedicated fund that holds the shares and the buyer is subscribing to the fund as an LP.

AI assessment note: “some of the most common are direct transfers of shares... You also have SPV transactions”

Q Do you have control over how you present these opportunities to the investors you work with? Like, are you, are you choosing to push direct sales or do you like SPVs? How do you, how do you do this?

A Because I'm a broker and not a financial advisor, I'm not a fiduciary and it's, it's not within the scope of my role to give financial advice or to push one structure or one deal versus the other. My job is to help source offers, to help the buyers to understand one versus the other, to be strategic, and also to help them negotiate and smooth that deal through to closing. So I try and be as upfront as possible in presenting a deal to try and anticipate some of the questions or, um, uh, give, give all the facts up front basically. So we usually look at price. We'll obviously look at the structure of the deal. We'll look at the timeline that applies to that deal, maybe the, the loose profile of the seller in the early stages where it's anonymized, um, domicile is important to some investors. So is this maybe a U S focused fund that's selling and all of those different features as well as any fees that might apply. And then also my fee that might apply. So they usually get bullet points to start that outline those main points of the deal. And it's really important that the investor knows that they are in the driver's seat and they need to decide ultimately what deal they want and what they're comfortable with.

AI assessment note: “not within the scope of my role to give financial advice or to push one structure”

Q but you also just said, if you know, another round is coming up. So what's the difference in that? Because when someone says they're pre-IPO, I imagine either they've filed their S-one or they are planning on filing the S-one within the next twelve-ish or 18 months. Like, And, and I guess, how is it differ between the, the round, you know, uh, the round and the pre IPO placement?

A Pre IPO is that kind of sweet spot between true venture capital, that early stage investing and public market investing. So it typically refers to ultra large Venture backed companies that are at the stage of maturity and scale that they could go public if they wanted to. Some of them in the next one to three years, um, some of them sooner, or they may have filed for IPO, like you mentioned. Um, but whether or not they do IPO, they are just of that profile and scale that they could. So until recently, for example, SpaceX was a company that had been quite vocal through Elon about not wanting to go public anytime soon. And so a lot of us thought SpaceX could potentially be a much longer horizon, um, to going public based on those comments. Now that's changed with the suggestion that they could go public sometimes in, sometime in 20, 26. Um, but for a long time, SpaceX was a name where people were thinking even more long-term than normal. On the other hand, you have companies that have been more vocal or actually put into place the filings to go public. So companies like Discord, um, I believe Kraken as well, and, and some others. So there's, um, there's a real variety of different timelines in terms of going public. And just because it's a pre IPO company doesn't mean we know for sure what its timeline looks like. You equally, you have companies like Turo Which have been on that,…

AI assessment note: “just because it's a pre IPO company doesn't mean we know for sure what its timeline looks like”

Q So you said the word inventory, and I wanted to focus on that real fast. When you mean you have inventory, does that mean you have shares that you're in control of, as in you're acting as a principal rather than an agent?

A No, my firm itself doesn't have inventory per se, but there are, there are many different sellers in different situations. So there are some deals where I might have a live seller at that point in time that the buyer comes to me. Um, you know, if someone comes for Stripe, I may have a Stripe seller at that exact moment that has existing shares of Stripe that is, is ready to transact right away versus there are some, we have to be more strategic about, um, like a company where maybe there's an upcoming round and we might be able to, um, get an allocation that's roughly at the same time as that upcoming round. So there's times where we plan ahead and be strategic and there's times where we have something ready to go. As my seller is actively looking to get liquidity in that name at that time.

AI assessment note: “No, my firm itself doesn't have inventory per se”