The Future of Landscaping: AI, Roll-Ups & Monster Exits

The day the deal closes isn't the finish line. It's the start of a whole new chapter.

Everybody starts a business to exit it at some capacity.

People start to panic that they did not take care of their people.

Making sure that your financials are as clear as possible is key.

Almost everybody I know is completely wrong on what the return on their capital will be.

I want you to stop guessing and start operating like a company buyers compete to own. You're listening to the leanscaper podcast where landscapers come to grow. If you want the systems stories and strategies to build a lean, mission driven company that your team loves working for, keep listening. Today's talk is about what I think has become a very emergent conversation in landscaping, but the blue collar economy as a whole, which is this really interesting intersection of technology as we talked about today, M and A activity and private equity and roll ups and that strategy and some incredible founder stories where a humble landscaper is achieving a pretty incredible exit at the end of a 10 year push or a 20 year push. And I think to have this conversation, the best way to do that is to have literally a conversation with some of the most intelligent experts in this space. So we've selected these people for a very specific reason to have a broad and divergent set of perspectives on this conversation. And so my promise to you, I wrote a few things down in this panel. What I'd like for you guys to learn is why technology is rapidly redefining service businesses, how modern merger and acquisition and private equity strategies are reshaping exits, what real founder journeys reveal about scaling and timing a deal. And I want you guys to walk away with some clarity on what happens after the transaction. How do you protect your wealth, preserve your culture and position your company your baby, something that you've built for decades. Position your company for a future where only tech enabled, scalable and leader driven businesses command the highest multiples. I want you to stop guessing and start operating like a company buyers compete to own. So that's kind of like the promise for the next 90 minutes. And I've prepared what I think are really good power zone questions for our six panelists and we're hopefully going to extract a narrative and tell a bit of a story about this very new, very exciting, sometimes scary conversation that's, that's on the minds of a lot of landscapers. So themes are as follows. We're going to talk about the rise of tech enabled services, why technology is driving higher valuation multiples and in traditionally low tech service industries, number two, the New M and A playbook in private equity strategies. How PE firms and consolidators are shifting their approach to landscape and home services. We're going to talk about founder journeys, building, scaling and timing the exit lessons from different founder paths. We'll talk about beyond the transaction, wealth, legacy and leadership, what happens after the deal closes. And then lastly we're going to talk about the future of service entrepreneurship. You guys ready? Okay, let's do it. Welcome guys. Thank you for doing this. Jonathan, we'll start with you. Service autopilot transformed service businesses with SaaS looking back over the last decade plus, do you have a perspective on what specific technology leap most clearly shifted service companies from being local contractors, highly fragmented to actually scalable enterprises?

From a service autopilot perspective, when we got in the business we started, we launched it in 2010, the market was predominantly software products for commercial. That's where transactions were happening in commercial. They were design build type solutions or they were little bitty small solutions like a jobber type solution which has very much evolved but small solutions. So what we were betting on and what I think we brought to the market and how this market had evolved and is continuing to evolve and is we were trying to solve for companies that had tremendous number numbers of transactions. So as an example in my company we'll do a thousand to two thousand jobs a day. And so if you think about what software looked like back then versus today, we were solving for tons of to dos, the ability to do tons of scheduling on a per day basis, managing tons of people automatically billing that work and then ultimately automating that type of work. And that was one of the big shifts. We of course capitalized on the move to mobile to SaaS. We capitalized on all these other opportunities. But that's what we are trying to do is for the smaller company enable them to actually grow a company that could manage thousands of clients and thousands of transactions and that didn't really exist in the market before.

Beautiful.

Thank you Jeff. I think we will go to you next. At Keyserve, you guys have standardized service autopilot across acquisitions. How has embedding a single software spine? I think it's a good visual for it created visibility that directly adds enterprise value and more importantly for our audience listening. How should entrepreneurs who want to create an enterprise of value think about and design their own tech stack?

Yeah, I mean from our perspective we like really well run companies that actually aren't using any software. And the reason is there's a lot of upside left. Right. There's a lot of scraps for us to drive. Gross margin. A great example is one of the first businesses we acquired in Merritt Island. You know, they were in the high 20s on the gross margin side. They were really lean on the SG&A. And you know, in three years we've added over a thousand basis points of gross margin. It wasn't pricing, it was efficiency, it was routing, it was, you know, just understanding what was happening in the business. So I think regardless of the technology that you're using, and there's great technology out there, LMN Service, Autopilot, Aspire, there's all this great technology out there. Whatever you're doing or you're not doing, just know your business and understand. You know, I think it was Mark that was talking about what are the five things that are important to you? I mean understand your mix of services, understand your mix of clients and understand where you make the most money. Those are the things that will really help, you know, drive efficiency in your business. And I'm not telling you not to invest in software. I'm actually a big proponent of that. But what I'm saying is when we bring a company in, we get the most Runway and the most gross margin improvement in year one from those businesses that aren't very tech savvy because they don't know where their cost is, they don't know where their opportunity is. And the entrepreneurs are trusting their belly which is a pretty, you know, a pretty good metric. But the technology is moving so fast that you know, we, we can definitely see things about their business before they do.

Can I, can I pick up on something you're saying? Like you say we, we add, we add software, it creates a, creates efficiency, creates scalability. But I feel like we're skipping past maybe some more concrete examples like can you think of in the last few years an acquisition that you guys have made where a solid implementation plan, getting them onto your guys tech stack. You know, it's like hey, we did this. It solved X problem, drove Y result. And for us as a, as a, an investor, this is what it did for our portfolio. This is what it did for this business and its operating margin. Can you just give me give a more concrete example?

Yeah, I think probably the best example integration and acquisition that we've done in terms of efficiencies is the most recent one we did in January, Trimall Lawn service in Fernandina Beach. They actually migrated to service autopilot about eight months before we acquired them. It was intentional and they were able to come into the business. Number one, they were using about 50% of their capabilities. So we were able to ramp that up. Our local field support team, Bogue and Evan are both here, they're on our integration team and finance team. And we were able to really help them better leverage how they were using that software. And we've seen gross margin expansion, we've seen improvement in receivables by moving everybody to credit card transactions. So that's been a very fast transition and we integrated them 100% in 90 days and that's the fastest and most efficient that we've been able to integrate a business. And it was a couple of things. Number one, the sellers had very open minds to what we had to offer. They were selling for a specific reason. They had felt that they had taken the business as far as they can take it. And so they came to us and they, they perceived us to know more about how to drive gross margin, how to improve SGA leverage and how to drive profitability. So when we were asking them to do things, there was no pushback. They engaged with us quickly. They asked great questions and you know, you don't force the technology on them. Sometimes, you know, they come back and they say, well, why are you doing this? You're like, you know, that's a really good question. Why are we doing this? And then we'll go back and try to figure out, you know, are we doing it right or do they have a better perspective on it. So I think a lot of times the best deals, and I've done about 26 acquisitions, I haven't totaled up the revenue like you have, Mark. I should probably do that. But the best acquisitions and the best integrations start with the open mindedness of the seller and how willing they are to really engage with the buyer in change. And then, you know, how is the buyer open minded to how they run their business? Every time we acquire a business, I think of it as watching the game film. We spend time understanding, you know, why they're a successful company and if they're doing it better than we are, we figure out how to take what they do and bring it in our business.

Awesome. Thank you. Awesome. We'll go to you on this one. As a young founder, what is one piece of technology that you guys adopted early, early at Lucky that gave you a huge amount of leverage against older, let's say more stuck in the past, competitors.

Yeah, I think one of the biggest changes, I think in our business was probably about seven years ago, I'd say we got onto lmn and coming from a software prior that you just made a quote and you put in your unit price and it's like, well, how did you get to that number? And, and I think truly understanding how our overhead was made up, allocating for equipment, materials, et cetera were really important. And you know, I think when you're just getting started in business, you're chasing revenue. And when, you know, we were just trying to get into the commercial market and oftentimes I think it was, hey, what's your budget? Okay, I think we can do it for that, but can we really do it for that? And that's when once we really built our budget, it was probably in October, I would say, and come January we gave everybody increases and we probably lost, I would say, 30 or 40% of our maintenance revenue. But the bottom line increased. So what did it really matter? Losing top line. So I'd say really building a budget, no matter what software it was. We used lmn, obviously it was much easier to do it in a, a landscape. Software that you just had to fill in the blanks essentially, that really changed our business. And I would say it set us up for success for many years into the future.

I'm going to ask you a follow up on this and any one of you are welcome to chime in on this as well, which is I was having a conversation with a gentleman at the table earlier today who's just bought a business in the last six months. He comes from the marketing world and really excited about this company, wants to install more tech, wants to install modern marketing, and is struggling with, I think, a very, very widely felt challenge, which is the tech resistance. I don't, you know, I want to paper check, I don't want to use an app. I don't want, like there's a mindset that's a little bit more comfortable with less modern systems. What, what is your advice? Do you have, you know, one or two things that have been really helpful for you and your business to help? I think the term is like foster adoption. The best software is the one you use. And I think a lot of people have struggled.

Show of hands.

If you've had a hard time getting people to use the software that you pay quite a bit for. So great. Half of you at least advice on getting people to use tech.

I think really pointing them in the right direction when they need help. I know one thing we did is we put all the customer service phone numbers on the wall and I tell all of our people that there's people waiting behind those phone numbers, waiting for us to call. And if we need help, we need to reach out. Whether that be, you know, for using an iPhone, using Outlook email, using lmn, using Sam, Sarah. We put all the customer service numbers on our wall so anybody in our company can reach out. And it's, I won't have all the answers and nobody will. But those people will know all the efficiencies. And if we want something to do, something somebody else probably thought of it and it probably does do it. We just don't know how to do it.

Love it. Anyone else have thoughts on that?

Scott?

Yeah, I'd love to jump in on this a little bit. Start during the hiring process to really screen who you're hiring, who you're interviewing. Understand that your onboarding process begins even before the interview. Have people fill out electronic applications, have people do some technology facing things before you even interview them. It will screen out so many people that won't be able to adopt this stuff and at the same time attract the right people who will be able to adopt it or who already know it. I'm not talking anything crazy either. Create a simple Google form and email it to people. That's good enough because people can fill out a Google form, figure out how to utilize the different fields in that, and then as you move through the process during your onboarding, have an automated onboarding process that sends emails to fill in any of the W9I9 requirements as well as direct payments. It's all out there. It's easy. Your payroll provider probably already has a solution if you're not utilizing it. But get the technology in their hands early before day one and it makes a huge difference.

It's really well said. We'll do one more question on this theme and then we're going to move to the next one. Nick, from a wealth advisor's perspective, why are investors attaching such a premium to service businesses that successfully integrate SaaS? What's the logic? From an investment thesis standpoint, I think

it's probably best to kind of level set what drives valuation in the first place. So, you know, typically when you think about valuation, you think about a business's cash flows into the future and what multiple you're going to apply to the current cash flow in order to value that enterprise. And we're not talking about sales or sales multiples, we're typically talking about EBITDA multiples. Okay. And so the EBITDA multiple that gets applied to your business is typically driven by. By a few factors. It's driven by the growth that that cash flow is likely to experience. It's driven by the risk on whether or not that cash flow is going to be consistent and consistently growing. And so it really speaks to the sustainability of those cash flows. And even the cyclicality of those cash flows can have a big impact on the multiple that someone's willing to pay for it. So when you think about when software came into this industry, it really unlocked, in my opinion, the scalability of these business models. So instead of a mom and pop business using a pen and pad, you now had a software system where you could scale the business across your region or even nationally. So then once that scalability became unlocked, then investors could focus more on other positive attributes of the business such as, you know, the recurring revenue nature, particularly on the maintenance side, the recess recession resistant feature of the business model as well. And then, you know, just the overall margin profile and returns on capital that, you know, are oftentimes quite, quite good now that the scalability has been unlocked. So I, I think the software as a service business model certainly changed the trajectory of how people think about the valuation of these businesses. And frankly, when I first looked at this industry, I thought, man, are these multiples that private equity is paying now, is this just a function of quantitative easing and money printing and elevated valuations across all asset prices? But I think actually technology is really hard what unlocked it and potentially, you know, AI is the next iteration of that.

Thank you.

I think we'll, we'll move on to our second theme here just for, for time and I'll set it up this way. It's the new M and A Playbooks and private equity strategies. So I just, I just wrote something to sort of set context around this section. M and A in services used to mean a big company buying up smaller ones, stripping out costs, centralizing control. Today private equity firms, some and consolidators are rewriting that playbook, focusing on partnerships, culture and recurring revenue. The question isn't just what's your top line anymore? It's does your business have the systems, people and mix of revenue streams to make it scalable? So let's talk about how those strategies are changing. And I think, Jeff, you're probably a good one to start with on this. You guys have built Keyserve as a roll up platform. How are M and A strategies in services changing from what I just mentioned that buy up, buy and roll up towards a more nuanced, a more partnership driven model? Can you just expand on that?

Yeah, there's, there's a mix of what's happening out of the market out there. And I've heard, you know, Mark and others, you know, talk about some of the bad aspects of private equity. I would, I would echo some of that. There's also a lot of good out there. You know, right now if you're a commercial recurring service landscape business and you have, you know, two plus million dollars of ebitda, the multiples are really high to the point that, you know, we don't even want to compete at that because the, the economics of, of how you, you know, how you make sense of that on an exit get a little bit harder. There's not a lot of room for, for error in that, in that situation. So we're seeing platforms trade. So big platforms are trading for, you know, really high multiples and that's driven up, you know, kind of the, the secondary multiples on the, on the, you know, one and a half, two, $3 million EBITDA businesses. And there's a lot of people scratching their heads. I get a lot of calls from private equity, hey, are you guys ready to sell? Are you guys ready to sell? And, and it's no, because the almost coming down market from some of the large platform businesses that have changed because the multiples are so high. They're like, how can I pay 14 or 15 times for a $10 million EBITDA business? I'm going to grow it to, I'm going to double the EBITDA maybe or triple the EBITDA. Am I going to get 14 or 15 times on that exit or am I going to get 12? And I think, you know, the thought is the bigger the companies and you may be able to echo this, the larger companies get, you know, sometimes the multiples will actually come down because it limits the pool of buyers. Right. So at Keyserve, we've taken the approach that we're only going to buy could companies. We're going to be risk adverse on the companies that we do buy. They need to be a really good fit. And we've kicked off our organic growth strategy in the last 12 months to really drive that organic growth. We're going to begin making investments in green fields, following our customers, you know, following where our markets are taking us. And I think we're seeing some of the other larger M and A platforms, you know, think about some of the multiples they're paying and saying, is this sustainable? And I think that's the million dollar question. Is it sustainable? You know, from my perspective, it's a little bit Scary, but there's a lot of smart guys out there that are putting this money to work and I think we're going to see how it plays out over the next three to five years.

Mark, being as plugged into the tech world as you are, Having just merged two major SaaS players, this feels like a good question for you. What technology shifts today feel as transformative for service businesses as mobile apps or CRMs were 10 to 15 years ago?

I mean, we've been talking about today. AI is obviously a transformative technology that's coming to service industry businesses in lots of different ways, some more simple, some more complex. But I think it has the ability to be highly disruptive in a good way, not a bad way. I do think it has the ability to highly optimize human potential in terms of getting humans to focus in on the things that they're really great at versus the stuff that bogs people down. I don't think that AI is coming for everybody's jobs, but I do think it does have the potential to drive efficiencies, to drive multiples up. Because of everything that's been said so far is if you can get your EBITDA up, you can do that in a scalable way and growth is still there. Obviously multiples increase. I do want to say a couple of things to some of the previous topics that I think is really important to understand. Multiples go up when there's a lot of cash being distributed. It's just economics. When there's more cash going out, multiples go up because supply of assets are going down. Right? And that's what's happened. There was a ton of cash that came into private equity over a seven year stretch when multiples were out of control. Multiples got out of control in several different industries, mine included during COVID And then they had to look to seek to diversify where they deploy that cash. Because a private equity's business, their only business is to deploy capital. They can't sit on it. It's actually mandated by their funds. And not every private equity company acts the same. But for the most part they are cash managers. That's it. They take the cash that their limited partners give them and they have to put it to work. Because if they don't put it to work, they don't make any money. It's just economics, Right? It's the only way that they make money on their business. Right. And so when the cash starts to pile up, they've got to deploy more multiples go up. And so that's what you're seeing in the services based industries as like cash has moved over because the multiples got too high. In other industries, it's hard to Jeff's point, to make money back over a course of time if those multiples are too high. And then you see a lot of debt get taken on, which is what we saw, you know, during 2020, 21, 22. And a good sign for anybody in this room is if you're seeking to partner with a private equity buyer, if they want to use a bunch of debt, that means they feel like they're paying too much, don't do it, don't partner with them because then the debt will actually drive all the decision making moving forward. If they're not using debt and leveraging debt, they're probably paying a fair multiple and you can push them harder. Right. And so I think one of the things that's really important to understand is it's not complicated. There's a lot of money. You know, dry powder is the term in the industry, which I love that term. There's a bunch of dry powder sitting around that we all need to snort. And so I think about that a lot and it makes me giggle because all these guys are like Harvard and you know, Yale. And I'm like, I just think of them, you know, snorting a bunch of cocaine and trying. In all seriousness, that dry powder is really important because it has to get deployed. And cash is just like anything else. Water flows where water needs to go, right? And service based businesses right now, technology has been a huge catalyst for that for sure. And the reason why is what Jeff and Nick said. With technology they can de risk because it creates visibility. Through visibility. I now understand your business better because I'm not a landscape operator, right? And they're not SaaS, software operators, they're not roofing operators, they're not H VAC operators. All these industries have experienced the same private equity influx of cash. And so through technology they get a ton of visibility. Through visibility, they de risk. Through de risk, they can put more capital to work. Through more capital being put to work, they all get rich. Right? That's just how it works. Hopefully along the way though, everybody rides on the exhaust and makes money as well. So that's kind of how I think it works.

That's an awesome breakdown. Thank you for going through that. Jonathan, let's go to you on this one. I was reading like a blog post or an article a couple of weeks ago prepping for this. It was just talking a little bit about how you managed buyer competition around the time of your sale. And I wonder if you could just maybe share a little bit about, you know, what the playbook was, the thinking, the strategic thinking that went into that was for you guys. And then maybe parlay that into some lessons for the audience who are maybe approaching the time of an exit, or maybe they're still quite a ways off, but they can begin. You know, we can plant some seeds around how they might want to think about that, that really, really critical time of their journey.

So are you asking how we chose to run a process or why we. How we arrived at the idea of selling or.

No, I think. I think more what I'm asking is like, man, like, just sort of like managing buyer competition, really getting a.

I

don't say pitting people against each other, but. Yeah, exactly. Like. Like doing a good job, keeping demand high, keeping people bartering up a price to something that you guys are really happy with.

Yeah. So we were not looking to sell the business. We had a roadmap that was at least five more years out into the future. And just a number of things that happened that got us thinking about it. One of the biggest catalysts was the real green transaction that got us to think about it. And so I decided I would start talking, taking all the calls we'd been getting forever. I'd start talking to private equity groups. So I talked to a ton of private equity groups. If you'd send your senior people to Dallas to see me, I'd chat with you. If you're an investment bank and you'd send your senior people to Dallas to talk to me, I'd talk to you. And through that, because I was just trying to figure out, do I want to do a transaction?

Is.

Does it make sense? And through that, those conversations with private equity guys, they would all.

Not all.

Many would say, hey, you should just do a deal. The market's very efficient. You'll get a price. It'll be about a 5% variance between any deal you'll do with any other private equity group. So I started asking, yeah, but when you guys sell your companies, how do you do it? Universally, they run processes. And that's what we did. So we hired an investment bank and we ran a process. And the process was simply that the investment bank helped us go out to market to 150 potential buyers of our business, predominantly private equity companies, some number of strategic buyers. A strategic buyer would be like, if my company, City Turf, buy yours. City Turf would be a strategic buyer. Private equity is a Financial group that will come buy your company. You've heard all about private equity. So they go out and then what this, the bank or the broker depends on the size of your transaction. They will run a process where they will go out and say, hey, here is the offering. This is what this company looks like. Would you like to make an offer? I'm simplifying this. We had 27 formal offers on our business that created a very competitive process for us that allowed us to look at the best companies. In addition, by running the process with a investment bank whom we trusted, they helped us understand who the private equity company might be. Post deal the single biggest thing I think you're worried about is what is the relationship after you sell your business, Are you going to despise your business and are you going to despise the people you're working with? Because that'll create a pretty miserable existence for you. And so by running that process with the trusted investment bank, we were able to try to guess at will this be a good relationship? Post deal and what it resulted in is of these 27 formal offers, I got serious on about eight of them. And ultimately, and this is very critical and this is a luxury that most won't have, but if you can, if you can engineer this, this is a dream. We took three of them through non exclusive due diligence, meaning we didn't commit to anybody. At the very end, we chose three finalists and they ran us. It was painful, but they did due diligence on us at the exact same time to protect ourselves from getting what's called retrading, meaning they come back after you've been worn out for eight months of your life and you're exhausted and say, you know what? We missed this thing in the data room. That's just a fancy name for them looking at all your data. We missed this thing and you guys actually make 2 million a year in profit less than we thought. We need to lower the deal by 10 million bucks. And you just say, I can't start over and you do the deal. That's called retrading. And so I'll end with simply saying you would want to investigate the idea of running a process and create a competitive environment. And you want to do it, in my opinion, with a group that you absolutely trust, that you believe their advice when it comes to, you should use this tax group or this lawyer, or you should ignore this private equity company because they will probably screw you like the last 10 people they did deals with. That's. And there are great Great private equity companies out there. Private equity gets a really bad rap. And just like everything in life, there are bad humans and there are 98% of humans are great. The same is true with private equity. There is really bad actors in private equity, but they're also phenomenal partners. And so the word to Google and think about ChatGPT is process. And if you could engineer that, it'll get you a much better result. That's my opinion.

And so while you sold a SaaS platform and we're talking, you know, maybe what a commercial maintenance company with a few million dollars in EBITDA like this playbook is still the same. I want to make that really clear. The advice that you just gave still totally applies to this business model.

Yeah, some of the words might be different. You may not be talking to investment bankers because of the size of the transaction. Like you'll have different number of potential buyers of your business. But in the day, the idea that you don't just take a phone call and do a deal, but you explore the market and see how much variance there might be in the market. I think my, I think by between the initial bids that came in and our close, there was a $38 million variance.

Right.

So if I had just. And that was after a competitive process and it still went up another $38 million. Just think about that. And so a lot of people say, well, I don't want to spend the fee. I spent millions of dollars in fees to run this process. I got every dollar back. And my argument is generally you will recover the fee that you pay your investment bank, broker, whatever you want to call them. You will at least get that money back and then it will be a free transaction. You got free advice. And so that's kind of how I really.

Well said, thank you.

And can I make a, just a quick comment on that? So in the space, in what I call the lower, lower middle market, which is where a lot of us sit, right? You know, a million, $2 million of EBITDA. Not all brokers are created equal. So some of them are glorified real estate agents. And so you just need to be very careful of the partner you choose in the fees you agree to pay. My advice to everybody is get a kick ass cpa. And it may not be the one that, you know, does your QuickBooks true up at, you know, quarterly year end or whatever and get a really great M and A attorney. Don't get the guy who, you know, did your estate, you know, and he does a little bit of Injury law, like just don't spend the money and get two really good partners and those guys may be able to point you in the direction of. If you want to run a formal process, can. Can point you in the direction of somebody that's actually going to. Going to run a process. It's been my experience, 50, 50, that some brokers actually devalue a business because they don't do the work on the front end to make sure that the EBITDA that they're presenting is actually accurate. So they've set an expectation of, hey, your EBITDA is this, right? And most of you guys don't even look at ebitda, right? It's net profit. It's what are you putting in your pocket at the end of the year. And then next thing you know, it's not X, it's x less $300,000. And that's a significant change. And it can really, it could really change the course of the deal and even delay that process, something that you've spent a lot of time working on. So find that great M and A attorney, find that great CPA in a good buyer will want you to have that.

Let's go a little deeper on this with you because I think there's a really interesting different perspective on this. As someone who started. How old are you when you started Lucky?

I was about 8 or 9.

Okay.

So.

And by the time you know, you're ready to, ready to do a deal, if it comes to that, you, you will have spent the vast majority of your life building this thing. A huge amount of your identity and personhood wrapped up in Lucky. It's your baby. Have you begun thinking about what you would need to see in a buyer's business philosophy? Their style, their values, all their mindset, their experience, all that stuff before considering an acquisition offer? Seriously, what would really matter to you as a seller when you think about handing your baby off to someone?

Yeah, I mean, I think one of the most important things and the easiest thing to see is what is that buyer's track record. I think there's so many private equity firms out there right now. There's a bunch of great ones, but there's also a bunch that don't have a single reference from a company that they've bought before. If you called any of those previous owners, they may not have a great rapport about how their process went. You know, so I think there's a handful of, of some that are amazing, but there's also some that, you know, mostly the larger ones Few hundred million dollar companies that are, everybody's a number, you know, and one of the quickest things they do is push out the former owner so they can instill all of their own processes and their own people. And so I think one of the important things is one protecting culture, obviously protecting the customer, doing what's right for them and not cutting corners. So you know, I think one thing that, that is key is, is trying to get good references about any potential buyer.

Is there anything else that strikes you would be like a big red flag. This would be a, you know, sign not to proceed, slow down like anything that, that you, you can imagine being

reason for pause throwing big numbers out on an loi, right. Like they can put any number on an LOI and you know, retrade the deal later. And I think some of them, that's their plan, you know, or a very big earn out and they're not in the business to pay the earnouts. So you've just really gotta be careful. And I think a good advisor is something you have to have involved in the process.

Really, really well said.

Thank you.

Go ahead Nick.

I would just add that, you know, one of the common themes across what Jonathan said, what Austin said and what Jeff said is really it's about doing your due diligence and putting a lot of effort into the process of selling your business. I mean, I'm sure you all put in tons of effort into running your business, spending time with your people, training your people, taking great care of your customers. And what I see all too often is when it comes to this process, since it's such a foreign process to many people, they actually just don't put the due diligence into it. Right? So they don't spend the time to interview a good cpa, to interview an M and A attorney that's done hundreds if not thousands of years. They don't interview brokers or M and A advisors to actually select the right one. And they actually don't even think about necessarily projecting their own business into the future and thinking about different multiples or valuation multiple scenarios that are likely to impact the value of their business. So I would just like advocate for, you know, putting even more effort into this process even though it's foreign than you do to your core business.

Nick, will, will linger on you for a second. As someone who has invested in public markets for 20 ish years, private and public markets for 20 years, how have you seen the private equity playbook change over the past few decades in how they create value with their recently purchased investment through their operation activities. Give us kind of the they used to do it this way, now they tend to do it more this way type answer if you can.

This is an important topic because it's going to, I think, lead you to get the most value for your business. And the path is really to take a page out of the private equity playbook and just do it yourself. Okay, so historically when private equity first became a thing, if you will, let's call it like 20, 30, like 30, 40 years ago now, it was very simple and very different. They would try to acquire businesses very cheaply, let's say three to five times ebitda. They then go out and they do a bunch of tuck in acquisitions. So just acquire other smaller companies also at cheap valuations, hopefully cheaper than the initial transaction they did. They put all those together, they'd slash cost to the bone and then they take it out as a bigger company with the idea that they're going to sell it for a higher multiple. And they did that. And maybe they would sell it for eight times ebitda, for instance. And that worked great. Just basic cost cutting, financial engineering. And then as overall valuation multiples across, you know, every asset class basically went up, the private equity playbook changed as well as a lot of capital flooded into the industry, which also, you know, made multiples go up as well. So then the playbook change. So now the playbook is more so pay a fair valuation or possibly a full valuation multiple for that initial platform transaction and then focus on a few different things, primarily on growth. And that could be growth in revenue, it could be growth in margins. And it's also the measurement of those two metrics as well as measuring all types of investments in order to make sure that those investments that you're making are having an accretive impact on the valuation of the overall enterprise. Okay, so what are they going to do? They're going to implement all of this wonderful technology that everybody's been talking about at this event, right? They're going to figure out how else can we grow, we're going to take up prices, we're going to do tuck in acquisitions of smaller companies at cheap valuations. We're going to invest in marketing and advertising and we're going to do it in a way where we know we're increasing the lifetime value of our customers. So again, a focus and a measurement on the metrics that actually drive the value of the business. Okay. And in that process, they're going to meet regularly, they're going to have Action plans on all these various metrics, again with the idea to increase value over their holding period with technology at play the entire time. And then the last part of the playbook obviously is to try to grow a bigger enterprise and exit at an even higher valuation multiple. So it's really changed from rudimentary financial engineering, buying cheap, buying other companies and then trying to sell to really focusing on growth and making value accretive investments and then selling it at even higher valuation.

We'll move on to this next section which is about founders journeys, building, scaling, timing the exit. This is where a lot of you are right now. Scott, we'll go to you on this one. You emphasize holistic leadership a lot. You've built your own business. You've had the perspective of working with a bunch of other businesses. Can you talk a little bit about your personal and your business journey over over the last years and how it shaped the way that you think about building a company that's not only scalable but also saleable?

Everything comes down to education and perspective. Learn the skills that you're going after. If an exit is something that you have in the pipeline, it can be 20 or 30 years out, it can be five years out. If it's any tighter than five years, still start learning. You probably should have started sooner, but there's no better time to start than right now. If you're within that, start learning these things. If you're looking at a private equity exit, if you're looking at a employee buyout, what are the differences there? Do you know what a platform company is versus an add on company? Do you want to be a platform? Do you want to be an add on? How do you want to do this? Getting all of these pieces in place is absolutely paramount. And from the holistic leadership side, this education allows you to lead your team this way. This allows you to build the training, the communications. It really comes down to a language. When you are building a culture and when you're building teams, you're communicating with them in a specific language that is not only understood by everybody, but it also drives the mission and the vision that you're carrying out. It carries your values. All of these pieces layer together. We often look at mission and vision and values as an operational basis. What are we going to do to get the work done? But it's so much deeper than that, especially on this topic. What are we talking about with each other and how are we talking about that? Answering these questions and figuring out your narrative to that changes the culture, changes the communication and elevates your entire team. If your core leadership team understands that a goal one day is to exit, which they should, everybody starts a business to exit it at some capacity. That might evolve, that might change. But you should be communicating with your leadership team about what that exit could look like. What that'll do is you might have somebody stand up and say, hey, I want to own this, I want to buy this from you. What do we have to do? Or it might evolve into something much deeper. Well, how big can we get? At one point in time, I wanted to grow to a $3 million business. Now I have my eyes on a billion dollar business because the perspectives has changed through all of these pieces. And it wasn't me that came up with this perspective change solely. It was communicating with the team. It was putting a lot of these leadership practices in place and being the servant leader that our organization needed to allow them to lead me and challenge me on my decisions and what I was seeing for the future of the company and for them to say, hey, we, we like working with you, we like working as a team. We've achieved some amazing things. Let's keep going. What more can we do?

Mark, I'd love to get go to you on this next one. You, you have stepped into what was a founder led organization or you've stepped into founder led organizations.

Plural.

As. As CEO, what is your take on honoring the entrepreneurial journey while pushing for investor level, scale, and what can our landscapers learn from that approach?

Yeah, it's not easy. I mean, obviously fill in the shoes from Mark Bradley is, despite the fact that I do my name is Mark, it didn't really help very much, but the entrepreneurial journey is really powerful. I think the good news is in my case, Benji, is I was one. Right. And so the first thing that you have to do in order to drive value is, you know, some of the things we talked about earlier. You know, know thyself, what are you good at, what are you great at, what is your capacity? The second biggest thing is go learn and talk to the industry that you're serving, to be able to accelerate the initiatives that you said you could. You know, it's really easy to hear. It was very easy for me to better to understand exactly what was happening in the landscape industry as I was consuming it through going to events that, you know, element was hosting the mastermind events, listening to presentations, watching copious amounts of videos on YouTube that Mark had put out over the years. And so I really tried to deeply understand and it's not any different than what everybody on this, you know, panel is talking about is learn. Like, go figure out and understand exactly what private equity is looking for. And in this particular case, learn what made LMN so successful and what made has made LMN so successful. And I really hope somebody recorded Austin Roth earlier when he said LMN was like the best thing he'd ever done. I want to make sure that everybody heard that. And also I do want to give Austin a big round of applause. He said he's run Lucky since 8 and now it's like a multimillion dollar business. Like,

thank you, thank you.

That is pretty incredible to me. But learn free.

Get free LMN now, Austin.

Yeah, exactly. Yeah. He's. You've given him like 10 cards at this point. Like here, if you need me to

negotiate with Mark for you.

Yeah, exactly right. Good Lord. Like, why are we piling up on me now? But to answer your question, Benji, and get us back on track. Sorry. Is learn the industry, private equity, equity to the next point. They want to grow, right? Like when they invest in a business and they pay a lot of money. And I do think you should take a page out of the Mark Bradley book of negotiation. This is the number there was no negotiation and hit that number is, you've got to figure out a way to make that worth the investment. That's how private equity is thinking about it. And so when I invested in Element along with my partners, we had to figure out, can we actually grow LMN? And the answer is 100% yes. Right. And so you have to honor the lineage, which is what got has gotten it to where it is. You know, founders are very special people. If you're a founder in this room, you're a very special human. There's only like 1% of the world that does what you do, right? You had a vision, you had a thought, you had the willingness to go knock on the first door. That is not easy. It's hard. And then you had to figure out how to do every single job in the company. Not easy. That's hard, right? And so you can learn a lot from founders. And eventually founders figure out that time, that friction point where I was like, hey, maybe this has outgrown me, maybe this isn't as interesting to me, but that doesn't mean all the work that has been put in place to establish your brand and your company and what makes you great goes away. In fact, it's what your value is. And so for someone like me to come in and take over for a founder. I have to believe that I can take that greatness and take it to the next level. And at lmn we definitely believe that for sure. Otherwise we wouldn't have made the investment that we made. But I think it's two pronged. You have to honor the past and understand why it was so successful to begin with. And you have to identify in the industry that you're serving, what are the opportunities and you have to maximize those opportunities. And that's the part that we're trying to get busy to do.

Austin, we'll, we'll go to you on the next one. You've scaled to multi millions. I'm not even sure how big your business is. It's big now and it gets bigger every time. I see you in your early 20s. What is your philosophy on balancing short term growth ambitions with more long term exit readiness? Where do you find that those two desired outcomes really complement each other or where do they kind of compete with each other?

I think as you, as you grow a business and obviously you're always going to exit it, I always say it's not when, it's if or it's not if, it's when. Like you're always going to exit it. It's just a matter of when. Could be next year, could be 20 years. So I think with growing a business, no matter how fast you're, you're growing, you got to make sure you're profitable and make sure you document your capex expenses, make sure you're accurately accounting for financials. As long as you can prove to a potential buyer a one time expense, you can get credit for it when you go to sell your business. And making sure that your financials are as clear as possible is key. So I think as we grow, we make sure everything's documented. We might make some bad hires, we might pave relocation, we might do one time expenses that wouldn't necessarily be applicable had we not tried to, tried to grow as fast as we, we did or are grown.

It's really well said.

Thanks.

Thanks for sharing.

Jeff.

From the different side of the aisle, like when you're examining deals, the ones you've done and equally as much the ones that you've passed on. What founder characteristics separate the companies that thrive post acquisition versus those that really struggle?

Yeah, there's, there's two questions I like to ask and not in any order. Number one, what do you, you know, what do you want to do when you grow up? Which is, you know, what do you want to do when you, when you finish this transaction, what are the parts of the business that you like and what are the parts of the business you don't? Not once have I heard HR finance. Like, that's not what I'm hearing from founders, but my job. And this was right out of the playbook at Site one when we were buying companies figure out what the seller wants to do and then let them do a lot of that and take everything off their plate. And so that's a big part of how we think about it now. If they're like, hey, I want to go to the beach and I want to fish Costa Rica six months out of the year, it's probably not going to be a good fit for us, right? Not today. However, if they're like, look, I, you know, I really just like the operational side of the business. I don't really care for customers. I, I don't like any of the HR stuff. I don't like the finance stuff. I, I really like operations. I like being in the yard in the morning. I like being on job sites with guys. Then we need to figure out how they can do more of that. And it might not just be in their business. We might have a need somewhere else where we can leverage that and give them an opportunity to excel there. The second question I ask, which is probably the most important is what are you most concerned about in doing a transaction? And if they don't say the health and well being of their employees and they don't say the health and well being of their customers, we, we are not interested. And that's not a re. You can tell if it's rehearsed

most

of our average age, of our sellers, I, I think it's like 48, 49 years old. I like to say we don't make people rich, we just make them liquid. They're selling their business for a reason. And the reason they're selling their business is they felt like they've, they feel like they've taken the business as far as they can take it and they're afraid that they're going to lose the talent because they're not creating the growth opportunities for their, for their team. They're afraid they're not going to be able to service their customers as their customers grow. And those things, those emotions that come from the seller, those are, those are real. And you can, you can tell when that is happening. And you know, throw out like, you know, what their financials look like. Throw out, you know, where the opportunities for growth are. If they can't answer, you know, those two questions, you know, honestly and genuinely, and it doesn't fit what we're looking to do, then we tend to walk away from that.

Jonathan, we'll close this section with you, which I think is the right note to end on you. Bootstrap service autopilot. You built it brick by brick for years before exiting. How did you personally know it was time to sell? And how would you encourage others to intentionally and deliberately reflect on that question for themselves?

We decided it was right to sell for us because we felt like the numbers were there. In our case, it was a big enough number that we had complete optionality in life, but that was just part of it because we weren't really looking to sell. And I. And the money was interesting, but it wasn't super motivating. We felt it was there in the future, so we weren't really worried about capturing it right now. And I think for owners there's a risk that we listen to the news and the media and we live in fear of whatever the valuation of your company is now not being available to you in the future. And I don't buy that stuff story. And so we weren't making the decision from a place of fear where we thought now is the time we have to strike. I think what more drove our decision is we thought about what does the future look like for us, my business partner and I, and what could we get super excited about as being our next chapter in life. And so, based on my experience, I would say to you, you want to be kind of clear on what's next. And even if you're taking a ton of money off the table where potentially you didn't have to work again, I would argue that most of us, most of you are not wired to be that person. You are not wired to be done, and there's going to be something else. And so my journey was. And probably your journey would be getting really clear on what is the next thing. Because if you don't have an idea of what might be next, then why are you walking away from your single best asset at this exact moment versus continuing to grow it? Or maybe, as has been said, maybe you don't think you can take it further and maybe there's something else you would rather be doing, and that's perfectly fine. But for us, it was getting comfortable. And what we thought we were going to do was build another service autopilot and get right everything we got wrong. And so we were super excited about this idea. Like we'll Just do this thing again. We chose to go a different direction and we're not going to do such a thing. But that was critical to us making that decision.

Let's move on to theme four. So I just titled this beyond the Transaction Wealth, Legacy, and Leadership. And I wrote another blurb to set this up. The day the deal closes isn't the finish line. It's the start of a whole new chapter. What happens to your employees, your culture, and your own identity once the business changes hands? How do you preserve wealth, protect your people, and transition gracefully from operator to legacy builder? So this is a theme I want to explore next. And Nick, I'll start with you, and I'm going to ask you two in a row. You work with businesses and business owners who are at these turning points. Can you give us a short list of, like, the most common and painful and frustrating, from your perspective, mistakes that get made?

So, yes, I work with owners when they're considering selling or after they've recently sold. Okay. And that's a hard time, I would say, for most business owners, because you're going from a situation where you control nearly 100% of your net worth or perceived net worth to then getting a pile of money. And it's a completely different world with far less control depending on how you manage it. Okay. You can imagine, like, you know, I haven't mowed a lawn in 30 years. And so for me to go out and try to hire people, buy equipment, design a project and execute it, it would be disaster. Right. I see some mistakes along the way. When people are going through this process, a lot of times initially there can be tax mistakes. So, you know, I had a situation about 16 months ago where someone came to me, they had an offer that they were in due diligence on, and their 25 year CPA had told them that they were going to pay a 15% capital gains tax rate on that deal. Okay. That was a $2 million mistake on that transaction. And given what the family spent and how much money that they would have after the deal, it made their financial situation and their personal spending unsustainable given a reasonable level of returns. Okay. And so that's one mistake. You often see folks make incorrect assumptions and thinking about investments on that money after the sale. So they may say, hey, you know, I have $10 million after I pay taxes. The US stock market has done 10% forever, so I'm going to make a million bucks a year, you know, and that's about what I spend. So I'm good. And it just says the math just doesn't work that way. When you consider taxes on the investments, when you consider the fact that those folks, once they get that $10 million check, they're not going to just put it in the stock market. Right. And if they do, then what if the stock market goes down 20% two months later, they pull everything and lose $2 million. Okay. And, and these are real cases. These, these things happen. So a lot of the mistakes, I think are around incorrect assumptions. They're around thinking that they're going to manage the situation or the investments in a certain way or will they will just go and figure out another way to do what they know. So go buy real estate. Hey, you know, I know real estate that's tangible and real estate has made a lot of people rich over the past 40 years. But oh, by the way, interest rates were 20% in 1980 and they went to zero in 2021, which made a lot of people that owned real estate super rich. And that's not necessarily the case going forward. Those are, you know, some examples of some mistakes that I see.

Go ahead, Mark. So along with those mistakes, those are like wealth preservation mistakes that are the ones that really bite you. You know, having done nine transactions over the last five years and also my own transaction where I built a company for 15 years and sold it and did it shoulder to shoulder with that I really care deeply about it never fails before the transaction is happening. I've yet to not experience this. People start to panic that they did not take care of their people. The people that were with you the longest, the ones that were there from day one, they don't have equity in the business. They didn't, they weren't right sized in the business. And so as you start to go down this path, I will strongly encourage anybody as you start to think about selling your business, if you have partners in that business that are not equity holders, I. E. Shareholders or owners in the business, but they have contributed heavily to the success of the business. I've yet to meet a founder that sold, that did not have some form of guilt, that they did not take care of those people enough. And I would really think about that when you're Talking about a $10 million exit for you, whether or not you want some of that distributed. And think about it sooner rather than later, because when you try and do it at the end, it gets very complicated, it gets very painful. A lot of conversations that you don't want to have in what should be a joyous moment turns into Difficult conversations and not so joyous. And so that is one of the biggest mistakes, Benji, that I've seen over the years.

Austin, for you, if you were to sell, what kind of legacy would you want Lucky Landscaping to leave for employees beyond just the financial success? What would hypothetically be really, really important to you post Exit and why?

Yeah, I think, you know, I've always thought about it and what it would look like if we exited. And I think what would mean the most to me is using Lucky as being a platform to where, you know, all of our people will end up getting elevated positions, more responsibilities, and, and really do more with their. With their life and their career. At Lucky, you know, example would be, say, an HR director. Well, now there's instead of 90 employees as we start to do acquisitions underneath Lucky, you know, they might be in charge of 300, 400, 500 people. And I think every department would end up being the same. So it would. An acquisition of us would. Would. Ultimately, the idea would be to. To elevate everybody's job.

Jonathan, I want to do one more on this. On this theme for you and your journey. Like post exit, what was the biggest and I'd say the hardest mindset shift from operator to strategic investor. And what kind of like mental, emotional, even spiritual journey do you think anyone thinking about selling needs to be prepared for?

The two things that come to mind? The number one is you no longer own this business. And so the idea that you can be pissed off at the decisions that the new owner is making is not fair. They bought the business, they traded with you and gave you a fair amount of money for that business. You agreed to it. They have a different vision and they have a different objective for that business, and it will be very frustrating. Most likely might be very frustrating for you because you see things a different way or you think it should grow a different way, or you think the vision should be different. They might have bought the business with a different intent and different people that they have to satisfy investors. And so they. And they might see different opportunities in the market, and they might be. Choose to be more aggressive than you. And I think this is very difficult. I fortunately went into this saying to myself, I want to see if there's a different way to run businesses that I don't understand, and I want to have an opportunity to acquire some businesses. Covid messed all of that up because the valuations got so expensive. We didn't acquire anything. And I was working on that significantly until Covid, and so I was excited about that. So What I would encourage you to think about is if you sell your business, it will not go in the direction you want it to go. But what can you learn from that experience that will make you a better owner, operator, builder into the future, good and bad, what will you get? An opportunity to learn. And so I would encourage you to go through that process and consume and learn everything you can possibly learn. The second thing I would say is I'll echo what Nick said. You are a builder, you're an operator, and you might be making a lot of money. And it is a completely different hat in life to wear to be an investor and to be very calm when you have to go back. When I'll go back to listening to the news. Fortunately, I hadn't been investing since I was 20, but I have so many friends that are founders that have sold their businesses and the majority struggle with making the switch from operator to investor where you're now deploying capital and you have to be very calm about it. And again, to what Nick said, almost everybody I know is completely wrong on what the return on their capital would be. For the reasons Nick said, including diversification, you will not put 100% of into real estate or the stock market. And I think that's very, very difficult for founders. And so preceding your transaction, I would highly encourage you to really become comfortable with the idea of investing your money because that's the future of what you'll have to do to actually grow that money. If you're not going to do that, you might as well just keep operating businesses.

I want to bring this in for a landing with a few questions about the future of surface entrepreneurship. Looking forward at the next decade in service industries, obviously being shaped by AI, automation, consolidation and a whole new generation of entrepreneurs, which I think I'm most excited about. Jeff, I'll kick this off with you looking ahead five years, maybe 10 years, although that feels like too far away to even guess at this point. Let's say five years. How will platforms like Keyserve and others change the competitive landscape for independent landscape operators?

I, I actually think there's going to be a surge in independent landscape operators and I think you're going to see a lot of extremely well run independent companies that are significantly larger than they have historically been. Our, our hypothesis and strategy was that, you know, companies in that, you know, five to $10 million range, they hit a, they kind of hit a wall in the risk to the risk and the capital required to grow, you're going to make less money, you're Going to, you know, the things are going to get harder. You have to hire a cfo, you have to hire a VP of hr. You have to do things that you're not comfortable doing. I actually think groups like this are giving independent operators an opportunity, you know, to, to learn. You know, I was talking to Austin out there today and I was talking about his company and you know, it's a great business. I'd love to have, you know, Austin a part of my team. But I was like, dude, don't sell your business, right? Just grow this thing as big as you can go. You still got a lot of grind in you. You still got a lot of Runway. Just go and just, just go and have fun with it and make yourself less important in the business. Right? And I think that's, I think we're going to see that from an independent perspective. I also have a fairly contrarian perspective on what the largest roll ups are going to do. I think they're going to, they're going to have a harder time figuring out how to get a return on their invested capital as, as the companies get bigger and they get larger. You know, my hypothesis is that some of those companies may come together so that they can take a cost out strategy and they can improve profitability and you know, similar to kind of the Brickman Valleycrest, you know, Brightview, you know, kind of roll up. I think they'll learn from that and I think they'll do that better. But I do think that we're going to see a lot of change and I'm highly encouraged that the independent operators are going to build significantly stronger companies, mostly because they can move a hell of a lot faster than larger platform based roll up scan and they can pivot and they can kind of do what they want because they're only answering to themselves.

Nick, I'll go to you on this next question and I'm going to change it on the fly here. Like, with increasing PE and SaaS influence, what does the future of the exit look like now? Jeff just raised a really good point which is, you know, they're actually maybe people who are holding on to these things in a much more long term way. So maybe it's less about the future of the exit and more just about where the people in this room, their mindset needs to be locked in on for the next 10 years. What will define the most valuable service companies 10 years from now, whether you hold it or you liquidate.

I think it really goes back to what I described earlier and how private equity has Evolved and what the private equity playbook is today. Do that right, be more efficient, deploy technology, increase your margin so you're stacking cash along the way. If you do decide to keep the business and focus on growth and taking care of your people, I mean essentially take a page out of the private equity playbook without putting too much debt on your business and not taking care of your people.

Mark, it sounds like you said build a company you want to own forever 100%.

It's about right.

Austin, a question for you is as part of the new generation of entrepreneurs, one who's found some success early on, what is your advice for other young hungry entrepreneurs in the industry? How can they recreate or even exceed see the impressive results that you've achieved?

I think trying to build a business that doesn't rely 100% on the owner is something that I've tried to do. Having meetings with the team and really delegating task is not babysitting employees and really empowering them to do their job better. Setting goals, who holding them to metrics and you know, now I think in our company we don't fire people. People quit because, you know, they're held accountable to metrics and people either jump on board or they get out of the way. But I think everybody makes their own decision. And I think building a company that is always sellable has always been in my mind. So, you know, you got to figure out what, what drives value to a potential buyer. And you know, one of the biggest things is an owner that's not the an owner that's not heavily relied on in a company.

Scott, a question for you is when you think about the next 10 years, what are some leadership traits that you are talking to your audience, your community, even to yourself about that are going to be like mission critical to have that are different than the ones that they were before. So I'm asking how this emergent technology that we spent all day talking about changes your approach to leadership. Is there a heavier focus on vision, on curiosity, on learning, like you said earlier? And how is that different from maybe what would have served people in the last decade?

The leadership side of this doesn't really change as the technology does. It's human to human. We are interacting with humans. We are leading humans, the tools and the resources that the humans are able to utilize change. That's where the adaptation has to come in. AI is a great topic to talk about with this. A lot of people are utilizing AI as a resource, going on there, using it as Google. Can you create this for me, using very generic short prompts. If you can lead your team to utilize AI as the the tool and they are the resource, write a longer prompt, get the thought stimulation in there, get your ideas in there, then let the answers come out. That will keep the proprietary nature of everything that your people are doing, that will allow them to be bought in and give them a piece of the ownership to everything that they're developing. People that are managing divisions or directors that are managing multiple locations, being able to do things like this and create their own new sops that are from their brain, it's huge. It's always been huge. This is not changing anything about the leadership side of it, but the tools that are utilized and teaching how to utilize those tools even more and keep the creativity is going to mean everything through this transition.

So you're saying that like the leadership principles are actually not going to change a ton. Like we'll work then we'll work, we'll work moving forward.

Absolutely. Human physiology is not changing. We are adapting. Our brains are learning at a faster pace, but the actual foundational neurology and the physiology around human nature is not changing. So learning how to do it better, learning how to create new neural pathways, learning how we can change the way we think and make those pivots when necessary. The information on how to do that is going to be more easily accessible. So again, it goes back to learning like we've been talking about this entire time. Keep educating yourself, learn at a faster pace, learn to lead. Learn those physiology and neurology principles that will help your team grow and not only help them grow, but help you grow. In order to lead this properly, you have to go through a lot of these changes. You have to do some of the work, all of the work that you're going to push off on your team and having an open minded growth mindset, growth oriented team will change everything.

Mark, I'm going to go to you on this one and anyone else, feel free to chime in on it because it's a really interesting question. Being as close to the technology as you are and keeping in mind what Scott just said about some of the principles remaining the exact same. I think we can all admit the rate of change right now for the last five years has been pretty overwhelming even for very, very smart operators. It's like it's just always a new thing. It's like we just learned how to do SEO, but now it's, now it's LLM optimization and we just learned how to do this marketing tactic. But now it's this. And I think that business owners are understandably looking for safe bets. Like where should I put my focus? How do you think about future proofing against disruption that we can't even clearly see yet? Thinking about corners we can't fully see around yet? And what principles would you encourage the growth minded operators like the ones that are in this room to lean on in a world where everything changes so quickly?

Wow, that's a big question.

Hard one to close.

Yeah, yeah. So I'll lean on a couple principles. I think Scott's got is onto something like tried and true principles will lead you through a lot of this stuff. One thing that I think is really important for folks to be thinking through and adopt is the only way forward is through. Like my grandmother, I used to go and she was a very big German lady and awesome, tough as nails Alfreda, you know, and I would, I remember coming and like talking to her and sharing my burden and complaining and she would, she would listen patiently to me and then all of a sudden she would look at me and say that's great Mark, but we're here now. Right? And so we are, we're here now. And so what are you going to do about it? Right? And the only thing for the only way forward is through. And so I think that type of mentality is very important. I don't think the leadership principles will necessarily change. I do think your pace has to change and your willingness to embrace change at a different pace has to change. And that doesn't necessarily mean that the principles that you've brought to bear over the course of years are changing, I. E. Like I really believe in hard work or I. E. I really believe in being direct, you know, as a leadership style. I really believe in inspiring growth minded human beings. I don't think any of that needs to change. But it's like running a marathon. It's like all of a sudden if you don't pick up the pace, you're not going to finish. Right. And this thing is changing quickly. Not just in the last five years, just in the last 12 months. If you look at the conversation about AI 12 months ago as an example, it's a totally different conversation today. And your utilization of it probably has gone in concert with that. And so your level of curiosity needs to increase dramatically. Your pace, your willingness to gut through pain and start to run faster has to increase dramatically. You don't have to be any more technically gifted, you don't have to be an AI savant, you don't have to be any of those things, but what you have to do is be able to endure pain more and faster, and you have to be way more curious than you've ever been before. And if you do those two things, all of a sudden, you know, things will become easier, less fearful. You'll be able to leverage versus feel burdened by all those things that kind of come with new technologies and disruptions, feel way less impactful. So I just think you need to do more of those two things in a pretty dramatic way.

I think that's as good a place as any to to wrap. Can we give a really, really solid round of applause for our amazing panelists. Thank you, guys.

Sam.