Jesse Sapphire welcome to acquiring minds thanks so much will great to be here Jesse you acquired a printing business in June 2019 nine months before the world turned upside down hitting corners of the economy that relied on in-person business particularly hard your business played in one of those corners and it got bad to say the least today you're not quite back to pre-coveted levels as I understand it but you can at least see that milestone in the distance so this is going to be a harrowing if hopeful story of small business survival start us off first please Jesse with some background on you awesome and sure and listen well I think I'm gonna hold you to that that uh so that we've predicted that we're gonna officially make it so it's it's a stated here so um sure so my background um graduated Princeton and after that had a career in financial services in a couple different roles um and great background really enjoyed it but ultimately found myself slightly unfulfilled um in terms of the roles and responsibilities I had within organizations and had always teased around the idea of buying and owning a a business managing a small business my mother started a business herself when she was actually 55 years old and has been running it successfully um I can't say how old she is now but she's doing great um and that was certainly an inspiration for me as well as a lot of my peer group who I saw doing transactions as well so um I pivoted from a career in financial services um and um set out uh on a self-funded search I used an exit I think in my last corporate job I survived I I survived five CEO changes and it was the fifth CEO that eventually came in and said uh listen I don't know really know who you are I have nothing against you but I'm bringing bringing my own team in I said terrific took a package used it to fund my search um and um the timing uh worked out in life I've heard a lot of other guests of yours share that you know it's not just you know what you'd like it's also the timing with your life um my wife had just graduated Business School uh and was uh looking for a job in Consulting it just made a overall we had just had a kid um it made a good time um to go out and do this for my life great and a couple follow-ups there Jesse uh your mom's business is what what kind of business is it she's a fixed income money manager the shout out New Century advisors if you are a pension or institution looking for excellent fixed income money management uh I highly recommend you find them down in Bethesda Maryland okay great and when you say you worked in financial services can you be more specific this is a crowd that will probably understand whatever whatever Nuance is there absolutely sure so intern for Goldman um after that uh actually took a a year after I graduated of all things to teach English down in Ecuador and was a professional poker player down in Ecuador as well as working for the World Bank all down there for a year after that uh came back um and this was the Go-Go days 2007 so ended up working for a hedge fund as an analyst um and uh it was a small fund uh but ultimately I left when we were up to 500 million in AUM from there I went to a Residential Mortgage company that needed help cleaning up the mess from 2009 2010 um and stayed there for about seven years uh became the youngest VP at the company uh had a team I think up to 800 people at one point under me um and you know tough ride mortgage industry is a resident mortgage industry is a tough industry um and I can very honestly say I didn't have a lot of passion for it um and um you know it what uh wasn't what I wanted to do with my life so as I said when when the fifth CEO came in and candidly blew me out it was a big sigh of relief all right so you decide that you want to search and you are back in New York I'm I mean I can and you are in New York right now I was searching the streets of Manhattan through the window behind you so yes I was uh I'm living in New York now where the acquisition happened I searched in Philadelphia the name of my search company was orianna Capital orianna was the street behind where I lived um in an apartment in in Northern Liberties in Philadelphia you were searching and were you searching in the Philly geography or or you were searching in New York but from Philly I was searching um from DC to Connecticut in terms of geography I was searching I was searching from Philadelphia so um uh recall as I had mentioned so my wife was just graduating business school and I knew I wanted to make an acquisition so it it presented an opportunity where we could in an ideal world land a job in a business in the same location which we did uh which happened to be New York City I it wasn't like I set out to be specifically in New York City and what I would the advice that I had received um early on about searching um is while it's good to Niche down um the tighter your parameters the uh on things like geography um you know the the harder it is to to find a good deal right like you want to be tight on things like you know is it a recurring revenue and you know is it a good company but being tight on things that have nothing to do with a good company right just makes your job that much harder so um I wasn't specifically looking in New York and I did try to keep it fairly wide and also looked at um a very what I refer to as like unsexy niches both in terms of unsexy businesses but then also unsexy for what other Searchers might might look for I I wasn't looking for businesses that might be more attractive to um search fund backed Searchers um and was instead looking for a business that um might might more appeal to uh if you were funding your own search let's hear what some of those criteria are how those are different because if you're telling me unsexy to Searchers that feels like a bit of a euphemism for you know violating a few of these you know Cardinal rules of like recurring revenue or or whatever like you said or whatever industry Tailwinds or whatever it might be so which of those uh which of those holy criteria were you willing to violate so I I think that um without getting uh sorry too specific on on search funds because every deal is a little bit different um the Searcher generally gets 25 of The Upside on a deal right they don't get Equity so if they buy a business don't grow it pay back all the debt they generate a lot of return but they don't see a big benefit because they only get 25 percent of The Upside when there's an exit so by definition you need to find a business that's actually growing at a pretty decent clip and you also need to find a um a business that you can get a clean exit from printing businesses are notoriously hard to sell so it's hard to get a good exit and they aren't growing 20 30 percent and so if I were funded on a search and I was going to be paid 25 of The Upside on exit right I would not buy a printing company um and so what I appreciate the the clarification because I absolutely would look for the typical search for things of recurring Revenue um a stable long customer base a long track record um a niche industry um that's a you know some people call it forgettable or some people call it like a need to have but not particularly strategic to the business like window cleaning or something like that um so all of that um absolutely important no equivalent with that just talking about you know uh the idea that um a lot of times people think about the exit when they buy right like who's who's gonna be the next buyer of this business right yeah and you have to do that if you have you know investors that want to see a return in and you also have to you know if you're going to buy a um I'll combine them both a healthcare SAS business right at nine times right you better you better grow it a lot if you're gonna see a return um and so um I I stayed out of like the traditional like search um areas that that are super exciting Like Home Health Care vertical software companies and then also um Like Home Services like like Roofing and things like that yeah that's great Jesse and and you said it but I just want to be very clear with the audience the model that you're talking about here is traditional search funds that you know Stanford study Style with the structure that you talked about where the Searcher only in the most optimistic scenario only only has 25 Equity um and and I just want to highlight that because most of this audience is going to be um self-funded people and I just don't want there to be confusion people they're definitely uh traditional search fund people listening as well but they'll they'll already know what exactly what you mean um you know that's really I had two things you said there that I hadn't actually heard made explicit this for you said forgettable I actually haven't heard people talk about that I have I have heard kind of private Equity people say that kind of the ideal business is one where recurring uh you know your clients um are coming back you know your recurring contracts with your clients and you're crucial to their business but you're you're low on their expenses you're kind of an afterthought but also they'd never get rid of you um and so if you know in a belt tightening scenario it's good to be Below on the expense list because you know they start at the top and work themselves down but I never kind of heard it just encapsulated with the word forgettable I like that so you're searching from Philly up and down you know the the Amtrak Corridor um what uh what do you find how do you find ABG print sure so um you're gonna think I made this up but I I promise it's true so the I think like the second week of my search um I decided to take the website that I had built at Oriana capital and I made a flyer um and I had downloaded uh or scraped a website and found a bunch of both business brokers and and then small businesses um and I basically sent out like a direct mail campaign um and it was really I think it was an open and honest kind of brochure that just said look leave this on your desk there's going to be a business and then just call this number when it's time and um then I went about my search and I didn't I totally forgot about it right I was doing email marketing uh I was on LinkedIn I was networking I maybe even went to one trade show or two certainly looked at a bunch of broker deals um and then about a year and a half in I got a phone call I was working on a couple other Lois actually um and I got a phone call from a business broker uh in New York that says hey I've got this flyer on my desk and I've got a business and I just brought it to Market and I think you know there's certainly other people interested in it but you know I I'd like you to take a look at it awesome and so Jesse had you had your flyer literally said leave this on your desk um I I I have to go back and find a copy of it it definitely had some colloquial language I don't know I don't know what the specific call to action was but it was basically acknowledging the honesty that like I'm not expecting that you're gonna grab open this letter and say oh well that's terrific because I have this business right here that I'd like to sell yeah right I'm so glad you sent me this letter um and it was more just the idea that like um you know we're here uh this reach out when you when you have something acknowledging that it's not now but you you may let's have an abbreviated uh telling of the acquisition itself sure um meeting the the deal structure yeah deal structure and any any interesting wrinkles to how you how it went down history of the business um yeah take yeah we'll share with those things and if anything else comes up I'll ask sure so um I'd say it was structured fairly typical for an SBA 7A acquisition um a large degree of SBA debt uh about five percent seller debt um and um I came out of the pocket uh out of pocket with the rest um with a little bit of uh that the part for me came a little bit came from investors but I brought the it wasn't I I only came to them once I had assigned Loi um and and was ready to close um and so that structure you know at the end of the day I end up putting of my own money I I put about one percent in um and um you know it the there were plenty of wrinkles um the largest of which was um there was a period during which we were closing the deal um so the January we closed in June of of um 2019 in January of 2019 there was a A bad month and so we had a we had to renegotiate price um and you know I remember giving the classic talk you know saying to the seller I like you I like the company um I want to buy it I just don't like the deal and um if you like the person and you like the company but you don't like the deal you can kind of fix that um and so so we did and and renegotiated on on some terms um but other than that it was it was pretty straightforward I wouldn't say um you know no sometimes I don't know if you can talk about it or not but sometimes when people do 7a's um they have a side letter to handle an earn out right you're not supposed to have earn outs with seven eight it was seven a loans so whenever you're dealing with earn outs or significant seller financing then things really can get complicated quickly um this really didn't have any of that um I tried to keep it I learned in previous you know by too much Financial engineering um on prior deals that have fallen apart I just want to keep things really simple um and so you know uh three and a half times basically um for go ahead yeah but Jesse what what just so people can understand should they encounter this themselves when there was the bad month in January and you had to renegotiate the terms a little bit was that just lowering the price or did you do something some other downside protection like some sort of larger seller note or escrowed some something in escrow what did that look like so for help people a little on Deal technique here yeah so I looked at the idea of um some for um forgivable debt um that basically would be seller structured debt that would be forgivable um to reset the effective purchase price um I think in the end um I I went away from it basically the short answer to your question is we lowered the purchase price I um I had a thought of of trying to do forgivable seller debt the challenge with seller debt is that um you know typical seller that I I would say you you might know better is is kind of three to five year schedule right and even if you have a low fixed rate right which we did your amortization is such that the payments are significantly higher versus tenure right so you kind of go to a perspective of yeah you can load a bunch more seller debt on the cap structure but um all you're doing is bringing forward your um debt repayment schedule and you're weakening your um debt to ebitda right um and so um it wasn't obvious like so the natural would be like okay well I'm going to take more of the put more into seller debt right but it actually hurts me right especially when um I already have such such low Equity coming from me contributed to the deal so instead I just went after purchase price um and got less of a concession than I might have had I said okay you know we're gonna get an extra half a million in seller debt but it's totally forgivable if certain earn outs or excuse me certain uh Revenue thresholds aren't met I I also think that that it those are very hard to to measure um and costs a lot I think in in legal bills to try to figure out and also as many Searchers will see there's also a first time seller right and trying to get a first-time seller to sign up for something like that would have been tricky I certainly can get done right and probably um you know in hindsight certainly from a results-oriented perspective might might have been a better way to go um but um I think you also have to have the mindset you just want to get a deal done right um when it's time to get done and so you Simplicity is is the name of the game okay Jesse so you buy the business and tell us tell us how things go in the first nine months pre-covered sure so typical um search or Playbook learn drink from the fire host learn as much as you can Advance cheerleader you know uh for the company um working with production working with sales seeing what the big issues are um only changes and only uh uh things I was addressing were things I knew with a hundred percent certainty um Awards in my wheelhouse and something I I could fix um you know I'll give you one very quick example I I looked under the hood at the AdWords account the Google AdWords account and saw that they were ring Fest for only New York so we're a printing company in New York City only advertising to New York IP addresses or searches within New York City um we print for corporations uh for meetings uh and conferences and events important pitches product shows people are traveling here all the time people are looking for a printer in New York City because they're going to come here so I immediately changed the AdWords to focus on if the search was not in New York City but the Search keywords had New York identifying terms right if you type in printing services Manhattan but you're searching from Oslo I'll take that right and so um you know things like that that like where pretty non that's not gonna rub anyone the wrong way that's not telling someone how to do their job um that uh you know little little changes like that um and then um I also spent a lot of time talking to in the second day on the job we had a um customer who the seller had stopped wanting to do work for um and they were refusing to pay our invoices um and it all Fallen apart in the last three weeks and it had to do with um long story short they they needed some accounting help from us basically they they even though they were one company they were several funds and they wanted to allocate our invoices of printing expense across several different funds and the prior owner had been unwilling to do that and so I just walked in and and sat down with them um you know two days in um and we resolved the issue we came to a great conclusion uh and I was actually able to raise price off of it um and also learned a whole lot about the value that that we bring to our clients um so it was kind of just solutioning from the start um but we saw immediate immediate benefits across the board of just you know being in and and pitching and helping out um you know we were up uh a 25 to 30 percent um on a year over year period for those first first nine months well it's going great Jesse just just couldn't possibly go wrong right uh I don't think I asked what what was the size of the business and a little bit more about the business size number of employees age you're located in Manhattan where in Manhattan sure anything else I might be forgetting businesses started in 1992. um when I acquired it it had uh at any given year three and a half to four million Top Line uh about a million three in ebitda um oh nice pretty pretty good uh uh um Steady Eddy cash flow machine um one of the things I liked about it so in 911 it took a hit uh and in 2008 it took a hit uh came back from both um and to give you a sense of the magnitude because this will come up when we talk about the pandemic it took about a 30 hit in both both cases right um and so you know those are very watershed moments especially for businesses in New York um and pretty good when you're looking at business that's been around since 1992 pretty good litmus test for you know what's the survivability you know can it can it bounce back and when I looked at kind of the stress test of the business um and thinking and presenting it to the banks it's actually kind of a funny story I I looked at that you know 30 downside I remember showing that to the banks at the time and I'm saying Jesse don't be ridiculous I'm glad you're so conservative but just show us a stress test down down 15 percent um and so meanwhile there's this news out of Wuhan right and the business serves primarily the financial services industry the Goldman Sachs of the world and the many the many reports and presentations and Conference uh conference materials yes so absolutely so historically 95 of our business was that um and now it's about 40 um but uh we print for our our friendly neighborhood Fortune 500 company here in New York City um we print for non-profits uh we print for corporate event planning businesses we print for marketing agencies and what what I the the comprehensive um uh use case is really uh important communication matters uh related to uh pitches uh Road shows um marketing materials um all the important things that a company views as driving revenue for them um the the um Communications related to that and both we do that both from a small format perspective that's you know think like sheets of paper um and then also from now wide format so everything from posters to full room wraps to backdrops to step and repeats and that kind of stuff great thank you um I want to step back one one second um you when you were talking giving the little anecdote about meeting with the the group that wanted to distribute your invoices across four different funds and I'm reminded of my interview with Chris Williams a couple months ago Chris bought a um uh payroll and financial services business and he talks about how he one of the things he'd wish he'd done differently when he bought the business was reach out to customers and he had decided not to do that early on because he was he kind of was just like Don't Rock the apple cart came in just like I don't want to touch anything I don't want to Spook anybody including any of our customers and he later decided that like that was an error and that reaching out to customers was um something hey what you know businesses are bought and sold not that big a deal from the customer's perspective um and better to uh and so so he was over concerned about rocking the apple cart and in the opportunity that he missed was kind of like what you just said meeting with that customer like it's an opportunity like getting FaceTime with a customer you learn very quickly and I mean it's such an efficient way to learn about your own is this this business that you've bought because they'll tell you all kinds of information that's that's helpful um and then also by the way Chris made the funny Point like it's also a little awkward like they're probably going to find out that you bought the business so better you just tell them proactively soon after it happens versus like nine months later where they're like oh oh you're the new owner and you you've never said hi you never introduced yourself like right anyway um I was I just want to surface that point from a previous interview um back to back to back to you Jesse in the business how did you how did you address in your own mind the very obvious headwind of paper business and you know just like software is eating the world like the cloud is eating the world and yes paper is still used but it is I assume used less every year so how did you how did you address that in your own mind sure so um a couple different ways uh printing like many like software is a perfect example so uh software is entirely niched out right as is printing right so if I were printing black and white uh utility statements in the midwest right I would uh probably not go for a business right like that because in the printing world like that is you know think records are becoming digitized um and uh more more and more is less and less is being printed on on that front um but a lot of the trends in the industry um are actually going towards what's called shorter runs which is a sort of a lower volume of printing and a faster turn meaning they want it faster so a printing business that's in New York City that specializes in printing you know 10 of something very quickly rather than a hundred thousand of something over a two week period right is actually the recipient of some of the trends that uh of that change wide formats growing significantly the other thing I would say if you were to put a wide swath on it things that people want to print are very much alive and well things that people people don't want to print are going by the wayside right and we for the most part are in the business of printing what people want to print because it drives them Revenue it brings them customers it's important materials for them we don't try to convince anyone to print it's just once they've decided to print um that you know we're a good option I think um an anecdotal so I've uh two older brothers that you know I very much look up to one is a marketer out in San Francisco with you know a VC back tech company and the other one is in DC with with a PR firm both um told me uh it presented the the headwinds that you're describing um within six months of owning the business both of their companies with no influence help or drive from them had placed orders with me um and I very much rubbed it in their face um because you know I basically said like no one wants to be the guy that says Hey listen people still print but people still print the pitch deck is not dead um I do every once in a while have a client that says Hey listen we're going to switch over to iPads right we're gonna bring people in and hand them iPads um and you know I I don't sit there saying why would you do that they're going to get lost people want to write notes I I don't we don't I'm not interested in convincing people that that it's the right decision but we see um that uh time and time again that um you know especially as as uh people are focused on on strategy and driving more revenue and and figuring out uh you know in a potential oncoming recession um they're very focused on um finding ways to communicate effectively and in meetings and they're they're still using a lot of these materials and then on the wide format side you know events conferences trade shows those are all very much still happening thank you for that okay so now let's get into kova Jesse tell us tell us what happens starts happening in March 2020 in your business sure so um we saw some early signs um we actually were were printing for a bank uh in a deal um in February that got canceled it was overseas um and then um but like like everybody else uh right around you know first week in March second week in March you know you have to realize it hit New York pretty hard um and it hit New York kind of first so um that's right you know I remember just hearing the silence right there wasn't the printing machines weren't running right um you know we had about 22 employees at the time now we're structured around the clock so at any given moment there's not 22 people here but because we're running effectively 24 hours during the week right um there's always somebody here right and you know at a printing company whenever things start to get really clean right you know you're not doing a lot of printing right because that's typically what the production staff will do is you know when when there's no jobs to do they'll clean up and and all of a sudden things are looking pristine right and the machines I'm not hearing them on and um I'm force reading the news and I'm in the middle of New York City and um you know so I reached out to uh an accountant and I reached out to some other folks and you know they they gave me some pretty good advice um but um I I made a snap decision we cut down to I went from 22 people to four people by March 15th um and wow and um when I made the decision it seemed like it was fast um but I said to the staff I said a couple things um I need to cut your jobs now so I can save your career if if we can bring you back two you're going to be a week ahead of everybody else on the unemployment and I know you think I'm nuts and I know you think I'm crazy um and you probably don't like me right now but you're gonna be able to sign up for unemployment very fast and in about a week's time there's going to be millions of people behind you I think when you do these kind of things you have to pull the rip Court um because if you have the slow drip um of you know let a couple people go then a couple people go then a couple people go it's just it's awful for morale it looks like you're you know pulling favorites or doing something and I was you know it was pretty shocking I I had some very quick um realization so we were I mean just to set the numbers here I mean on a period over period basis we were down 95 there was a complete cessation of all business economic activity in New York City and we in many ways our business is a derivative of office occupancy in New York right and 95 yeah just it went off I mean it just it's like someone turned off the switch right and that and that was that by March 15th by your snap decision or eventually like at the lowest point it got that got that bad I mean so how quickly did it take to get down to 95 decline two days on an ongoing basis right because we have so maybe a couple things so we don't have contractual Revenue right we have recurring Revenue in the sense that we have repeat clients that continue that you know come to us with more and more orders but it's not like they're signed on the dotted line and contribute you know so um certainly and and the other thing is you know we very much had a concentration too at that time both Financial Services in New York City and also uh tied to New York well Financial Services very much went remote uh New York City got hit and um you know just everything about the pandemic just hit us right on the head um and so we were sitting there with you know over levered certainly from a financial standpoint um all the institutional knowledge had just you know candidly been let go um with with mineral exception right um and um you know everyone else was was falling apart too right in the sense that even if we had tried to you know keep like let's assume in some fantasy land that we somehow had significant Demand right all of our vendors all of our suppliers um how would you get employees into the office right of the health and safety of of our staff so there were there were so many challenges right um unrelated to the fact that there was no demand I was joking at the time like by April right thank God we have you know a labor issue supply chain issue all sorts of vendor issues um health and safety issues because otherwise this whole lack of demand thing would really be a problem right and um you know at that point you know there's a lot of skills and um road maps you can follow if like you lose a key customer or you have a downturn um maybe 20 but I don't think there's a playbook for being down 95 right um with also uh call it 80 loss in staff and um you know just just basically you know you go from working on the business to literally working in the business uh I had to fix a lamination machine with my own toolkit while on FaceTime with the manufacturer's rep out of the Midwest because we couldn't even the the one thing that we were printing was covid uh signage that people wanted laminated um and uh we couldn't get a rep in to come to come fix the machine no one would show up so I had to go buy a FaceTime fix it myself um and I remember thinking at that moment um you know I this is not this is not how I saw this going yeah yeah yeah that was tough um well not to uh at all um kind of diminish how much fear and panic you must have been feeling but was it a little bit a little bit it's like when the entire world is sinking maybe it's a little bit better than if it was just your business so you could look everywhere and there's crisis all around you so you're at least you're not alone is it maybe a shorter way I mean first off misery loves company right and the the broader Point uh I've heard other guests on your show share this something which is a hundred percent true the number one fear that you have when you're buying an uh a business that exists is that you're gonna screw it all up right what's the change the only thing that changes is you right you're the new owner right and so if if the business goes downhill by definition it's you right yeah and yeah um you know when you start something new that's supposed to fail it's supposed to be tough like you might not make it but you're buying something that's been around since 1992 right if it goes downhill right it's on you buddy and also you have all the the guarantee on the business right and so now all of a sudden right we were open and transparent with folks um and yes it was really bad but absolutely no one was saying Jesse you screwed up right and I think everyone understood like Hey we're all in this together no one wanted this from a results-oriented standpoint this deal is an unmitigated disaster right um and um now right you have a choice right it's you know do you want to dig your way out and see what you can do um or do you just want to fold your tent right and I think that to your point um the relief of not having like you know it's like water off a duck's back right I'm not sitting there thinking oh gosh I screwed up you know yeah I mouthed off to a supplier they won't they or you know I I lost a deal with a client or I made a bad decision um don't I mean don't get me wrong I've made plenty of those mistakes over the course of you know the the the recovery and and you know there's certainly been challenges but my point is there was a freedom to kind of uh go try to to go try to recover because um we were all we were all in this together and I said that to the staff I said the one thing you cannot do right is we just can't stick our heads in the sand and hope it all goes away right we're gonna have to work out of it right and we're gonna have to work out of it with less money less people um less you know we were we were under um invested in Capital Equipment um we're we're in a um we're in a location um that is suited to our previous Niche um and we candidly lost I mean our our big like every printer that the kind of Secret of printing businesses they tend to have like a core um uh uh product Market fit where they deliver to and ours was this particular Pro projects that we would do for large investment Banks and it just entirely went away right then it's not coming back right and it was a big concentration we had um and um you know I think um it was important to be honest with everyone that um it was going to be really hard um but also up front that you know we weren't going to come at a place of from a place of blaming each other or um attacking one another that um we were just gonna have to rebuild with what we had and we're gonna have to rely on the fact that we have good customers that eventually would come back we have a good name that people know and and like and we provide a good service there was certainly the added challenge right of what do you do when you're a 24-hour business right if you stop going 24 hours right and all of a sudden that's your pick value adder or one of the key assets that you offer your customer base right but you physically can do that right how do you maintain like because the first time you lose a customer because you weren't there when they needed you right you've lost them forever right and it's hard to win back your customers but at the same time you know a lot of other folks would be like oh we have amended covet hours or we um you know we're we're not we're we've changed the structure of how we deliver your service right there weren't as many options for us and so we you know from a from a management standpoint right just having making sure that you know we forwarded phone line so we could answer all the phones tell people we were on call making it so like we could maintain as much as the service level as we possibly could so that we weren't in a position where we we lost clients that if they at all were interested in our service wow well with four people covering 24 hours you know that's three people that's three shifts so you got three people there and then one person floating I mean not a lot of room for error there if if somebody gets sick or for example gets coveted I mean one of your people gets coveted and then all of a sudden you're you know or two people get covered then then you're there's no way you're delivering your 24-hour on-call service sure yeah I mean like you can do the math I mean like we weren't always there right but we were certainly answering the phone and could get in or we figured you know we t a lot of printers teamed together right like hey I just had a job come in can you help do it for me of course no problem absolutely one thing one positive thing I will say also uh the community of printers right um where and this is true for a lot of small businesses too everyone I reached out to and you know I always said the same thing hey if we can help you just let us know how and you know and vice versa right and um because everyone you know in in the city was was kind of in it in it the other yeah yeah it must have been very much kind of a bunker a bunker mentality for for months there and just curious on the numbers when you went from 20 to 4 22 to four people did that and dropped 95 in Revenue did that um did you get to a point of steady state were you able to be Break Even or not losing a little little money but little enough that you could go you had Runway or what what yeah what did that look like it was painful so um you know look the The Playbook when something like this happens uh uh so you need to grab as much cash as you can possibly find so um we maxed Drew on our working capital line um we immediately went to get PPP we immediately um tried to get um eventually when it came out down the road eidl Main Street lending I mean it almost felt like that was a full-time job in it of itself was just finding money right and you know I mean let's call it what it is bailout after bailout right um and um so my job was first and foremost survive right and so um we um I would say didn't haven't come back to a steady state until gosh Q4 of 2022. um and um we were able to curb the bleeding right um but the other thing that you know we you can't turn everything off right we still have to market right we still have to uh I mean less but you you still have to work to improve the business you still have to pay people right um and you know we had four people for a little while I think by I don't remember the exact numbers but maybe by 2021 uh we were back to call it eight to ten um now we're running you know 12 to 13 um people um but yeah I mean coming off of um coming off of a base like that um was uh was was very difficult and and we didn't see uh a break even for quite some time I had to you know I found myself being very open and honest uh with everyone from the landlord to debt holders to uh the seller to um you know uh suppliers um and what I realized uh very quickly is that no one was talking to us like we were a deadbeat because we weren't behaving like a deadbeat meaning we don't have the money to pay you but we're telling you exactly where we are we're telling you exactly what's going on you're in the middle of it too and the line I kept using with everyone is look the entire value chain has been crushed we're certainly taking our hit but everybody has to take a hit right and so you know I think where you know the landlord might have said in March you know shut up and pay your bill right by May right that wasn't their tune right and um certainly credit to to our lending institution our SBA lender our bank you know they they immediately understood what we were going through because they had to book a business that was going through very similar things we were getting hit harder than a lot of the other folks like so you know if you were a Distribution Company for medical supplies you're doing great for a nursing staffing business you were doing great um but they had a lot of businesses that you know if like a restaurant wasn't doing so hot so um There Was You know the SBA gave out I think it was six months uh where they covered payments um yeah then there was you know a a additional um help and and we leveraged some deferrals um but it was a full-time uh case study and just small business cash management um and um you know we extended a lot of our suppliers um you know it's funny when you're a small business everybody you work with not not ubiquitously but in our arcade case everybody is bigger than we are our clients are bigger than we are our lenders are bigger than we are our suppliers are bigger than we are everybody's bigger than us right so they all have leverage on us presumably but you know you reach out to them and say hey we're paying you on 30 days can I pay you on 90 days right and um here's why and I'm willing to go back to 30 but I need 90 for now and here's exactly why right um dear landlord we really appreciate it we love being here we're the only one in the building right now can we pay 50 right um on the on the debt right let's go interest only let's go deferrals like each one of these conversations right um is um you know a tough conversation but goes a lot easier because it the first sentence isn't I screwed up and made a bad mistake or we're a deadbeat and can't figure it out it's we're all in this together and we had something that no one saw coming hit us yeah you know go ahead no I mean and you know other than that I would say um and then trying to maintain a a positive spirit like acknowledging what's happening but at the same time saying you know uh you can cry about it because it's it's painful and it sucks and we're here or you can say um you know I'm I'm up for the challenge and what an amazing marketing story this will be one day when we when we when we come around and I remember thinking that at the time where um you know I I just thought to myself wow like this is going to be a great story to tell if we can pull the kicks in yeah I was just going to observe Jesse that go your your tone talking about this you know sometimes when I've had guests on who've really gone through it you know they're even recalling it will cause their voice to to break a little bit like it's it's so kind of traumatic and upsetting um to think about and you don't sound like that not at all saying that you were you know skipping to work but I do detect a little bit of like you were almost maybe invigorated uh is it to buy it um yeah or like you took it like a like a personal challenge to overcome um elaborate you you just talked about your positive energy which was which was great but elaborate a little bit on your we've said a lot is there any more to say about your emotional state I mean did you have did you have fetal position moments or were you just like let's do this people you know the the the the strong positive leader the whole time so um I never had um the fetal position moment I did um I I I believe this is a moment for some gratitude so so let me let me just sort of say this is not a me thing right so everyone on my team and my company also experienced this and also and we all supported each other and we would not be where we are today on our way back to recovery without them and the exact same you know mindset that that they had as well they um their employees of this company but they view themselves as you know this is their baby too um and that's something I'll certainly never forget um and very and felt that when I did the acquisition but um they showed that all the way through the second piece I would say um and you know sometimes people to take this for granted or talk about it but you know uh I have a a wife who's Like a Rock right and we have a kid and um my wife was at her job working hard and things at home were very stable and very calm you see a lot of situations um where you know maybe both the the married couple works in the business um or it's not that there's not that backing and if you don't um it it compounds on on everything so I had stable uh for the remaining employees that we did have uh they were incredibly hard working stable and energized at home on the home front I had an incredibly stable um uh situation which um allowed me to also kind of um maintain my stability and then the final point I would say um and what was kind of you know it is kind of heartwarming for me personally um is that you don't really I once read a book it's a small book called The Dip but you don't really find out what you want to do in life until it doesn't go well right and um you know people would call during the pandemic and say like hey how's it going and I said well we still have the same phone number and I'm having fun getting kicked in the teeth every day right and that was just my line right and the truth is um I've had you know certainly in other careers like I gosh when I was uh managing money at a hedge fund uh you know I had you know 2008 I got my butt handed to me uh and lost millions of dollars um and you know what that was no fun and I didn't want to do that anymore right um working at a mortgage company that um had to settle with the cfpb for 165 million dollars um and you know had a bunch of bad processes that we're trying to fix that that was hard and didn't you know I didn't want to do that anymore this right I don't know whether it's the PG I don't know this fact that I actually own it but I'll tell you this got hard and I wanted to come to the office right and um it may you know in the end it may not work out I think it will I'm optimistic I'm way more optimistic now than I would have been certainly when I've talked in other podcasts or if we had talked earlier but um you know I you don't find out what you love until it doesn't go well and then you still want to do it right and I think maybe there's a broader message not to get too far in a soapbox but you know we're seeing a little bit of that more now in the overall economy where things have been going right for a lot of people for about a you know a decade or so and I think we're about to see some things not go so hot and we're going to find out who really likes what they're doing right yeah um and so I think it's a good lesson what a great litmus test I've never heard that that's from Seth godin's the dip yeah yeah I think you know and again I I'm certainly guilty of attributing certain ideas and thoughts to the wrong book or the wrong person but um are the important part is I learned the lesson I can't share it but you know but anyway so yeah no I I I really felt and I remember actually reading that book in a different context for at a job I was at the time where I was like I don't I don't want to go through the dip here right um but in this case you know really really felt it um and I will say it's nice when you can have when you can go through it with others and so um you know we we have some folks uh at our firm that um you know there they wouldn't want to be anywhere else um we have had some folks leaving to help them find other jobs and I've helped them move on in their careers um but the folks that we have here you know they they want to be here and and um Pride themselves in in bringing this company back it's it's awesome Jesse the you you got down to four you said you're now back up to about 11 or 12. yeah we've um and are the are those some of those folks the previous people you had to let go were you able to go back to them and say yes um everybody that um so we we offered a job eventually we've offered a job back to to everybody that had been not everyone has accepted um you know there were some folks um we lost folks to like the MTA during this time because of the demand for labor and a lot of industries that you wouldn't expect a lot of people that were on the wait list for things like we had a couple guys in production that always wanted to work for MTA that's the sorry uh the transit authority in New York um they want to be bus drivers good pension plans um or some want it to be UPS drivers um because they just have really good pension they're stable jobs and you know we we lost uh some some folks that way um we also um but yes we we have grown back I will say this we've we prior had roles that were in the company that we've outsourced so they don't count as head count like our marketing team is now fully outsourced um whereas before we had some internal marketing help now they're an outsourced team uh it is outsourced I bounce back and forth several times on finance between having it be outsourced uh Finance ultimately we've brought that back in-house um but uh so the folks we have from a production standpoint were close to back to where we were in terms of the full head count on on production um but we've the nature of our businesses has also changed we're doing something on the order of uh 300 percent more jobs per year um it's just that the average job size um has uh Fallen uh significantly um and it just we were our business was built around a couple large projects every single month that unfortunately just super high margin uh projects every month and unfortunately those they just went away at the dodo bird and and and so I assume that also means that you've Diversified away from those those large projects were all from the financial services industry and so you've also Diversified away from those projects but also Industries yes and that's been the other heartwarming thing is as we grow back when the phone rings and there's new clients every single week you may not be back but at least it feels like you feel like you have something right because um we're not just winning business back from our existing clients and it's great to when they haven't reached out to us for two years and then they say hey we you know finally ready to talk to you guys again with well love to use your services that feels great but finding new businesses and and in New York we're um we're seeing a lot more from Fashion um we're seeing a lot more luxury goods we're seeing a little bit of Pharma work we're certainly seeing a lot of we're very popular with the buy side so someone will have um use us like at a Goldman or a Deutsche or formerly credit Swiss and then they go and they work in private equity and they want that kind of similar experience and they don't have in-house printing there um and so um they'll reach out to us um for for a lot of that work so we've seen gosh I think we have um something on the order of like 150 to 200 by side um um like private Equity venture capital and investment management companies that are all using our services when you bought the business it was at three and a half to four million dollars annual revenue where's Revenue today so we closed out last year two and a half uh goal for this year's three um in 2020 we had eight hundred thousand and that includes two months January and February that were consistent with the year prior um so um you know depending on how you look at it um you know ripping back off an incredibly huge hit um but um you know so our our work is not done um and um but we're now at a place where I feel like we can we can look up um there may be you know the potential for an acquisition to help us recover the rest of the way um there may be um other options um whereas before you know where there you could draw up any you could make a strategy you think about strategy as long as you wanted to but every strategy had the same First Step which was you have to grow Revenue somehow um because there was no other way um to do anything else until you did that so we've done that first step so now we're you know while still focused on focused on our organic growth and still coming back and um also thinking about okay how can we how can we finally solve this problem the rest of the way foreign Jesse just we've you've hit on a lot of different um kind of attributes and nuances of the printing business but any anything else that we didn't already touch on that you would tell Searchers out there who might be considering a printing business like is there any kind of 60 uh 120 second kind of you know synopsis of the industry that you could give or is it is it two is it kind of too fragmented too nuanced of an industry to do that yeah just sure so the brief education on the printing business for us all absolutely so the first thing I would share is anyone who's interested in and look or looking at a deal or wants to do something in the printing space 100 feel free to get a hold of me I'm always happy to chat always interested and happy to to support another Searcher and good advice in fact a lot of times when I find I tell my story a lot of folks they hear how bad it's gone and they still want to do it and so I kind of view that as a as a as a test um I would say you know oh uh the water's warm there's plenty of um the story in printing is very similar to the story in a small business in the United States right now um there's a lot of owners in the right demographics and you know it's the magic for what death divorce illness and dumb kids right um and you're looking for you know there's plenty of of folks out there that um and of course when I say dumb kids they're probably just disinterested kids I could probably change it to that um but um you know uh I there's there's plenty of folks looking to sell their business um I think um you the growth areas certainly are in wide format um as well as um in uh some areas around print on demand um and uh you know I I think that it is an exciting area um I do know um certainly there's a lot of within print there's also you know signs um there's a lot of signed businesses for sale um and I know that there's been a lot of success successful Searchers that have done Roll-Ups um but overall it's you know it's good good cash flow business um that I recommend is an industry certainly worth worth looking at um but um like anything else there's a there's a lot of great areas to find um and uh there certainly has been plenty of consolidation uh in the industry um and uh that that does you know uh lend itself towards uh towards just being you know plenty of deals available yeah one thing you said was that earlier on the the dirty Secret in printing is that most printing businesses I think you said sort of rely on a particular what was it Niche or or stream of projects or or something um and and just also just the overall kind of like what you've described about your own business it seems like printing businesses are usually going to be attached to some other industry maybe uh and there's going to be heavy concentration there so being not only diligencing that that business and printing in general but the the industry that it might be attached to is that uh a broad characterization that's accurate I think it's accurate so um especially within you know the the type of you know digital printing you know small fine formatter wide format so you could take three businesses like include ABG print and there's a couple others in the city and you on the surface could look at them and say okay well they're all clearly competing with each other but I can tell you one uh firm has you know arts and entertainment unlocked right like Broadway is going to print with that business right and you know we're big in in finance and and some of the corporates um and then another um business is is huge with you know some of the non-profits and Foundations right now they're not going to say no to a client in a different area and certainly they can support it but you know as people move around in the industry they just sort of get a name for it and people get known for doing that and then all of a sudden they wake up one day and they have the vocabulary you know without getting too into it nobody want we don't sell print to any like I don't call people up and say have you thought about printing something lately like or what print we try to reference everything in terms of the use case and product and vocabulary that our clients would use right do you have a Roadshow coming up do you have any important pitches you're working on do you have any deals you're working on right um you know how's deal flow for you right are you finding what you what you need those are the kinds of things we would mention to a client of ours right um not like uh do you need any printing right that would be no one wants to talk to the printer I can't think I can guess the question the answer to this next and final question Jesse but um in in your interview with Ryan Conde you talk about you just kind of mentioned you know buying this business and then over the course of your career assuming this goes in the way it goes directionally well um that you can see yourself buying other small businesses not not necessarily A Printing roll up but just maybe it holds code for lack of a better term um given your experience thus far what of that Vision Still Still The Still The Dream and vision and plan or or 100 so um the plan was always to buy five to ten Buy and Hold strategy um and um hold them hold them forever um I think that um the whenever you have a investment thesis it's always help helpful if the first trade works I think it's fair to say the first trade has gone a little bit rougher than anyone anticipated um but um so I think from a timeline perspective um you know that'll that'll push things back in terms of you know uh uh heading down that path in terms of you know having five to ten businesses by a certain point but I'm not focused on you know the to achieve that goal by any but a particular year um I'm much more focused on um you know being able to hold my head high and say I really like doing deals I really like owning and running a small business I want to own more I will own more um and uh I think that I'd love to be in a position where you know ABG print is is high-flying and really doing great and I can look another business owner in the eye and say I can almost guarantee no matter what happens I'm going to be able to keep it alive and have it be successful and yeah I mean recalling your your perspective when it was hitting the fan and you were like well you know in the back of your mind it was always like well I know this will make for a fantastic story like you could you could you could look forward and and imagine yourself reflecting back you were getting it you know 20 years of operational experience in you know one year if you can survive this as an operator man boy have you earned your stripes and and the confidence to to buy other small businesses yeah no I definitely feel that and and I at the time I felt that um you know that I use that in many ways to say okay well even if this doesn't work out these are all great lessons right and I do feel um as someone that um what you know if you have investors right and not everyone does but some people do and it even if it's you're your own investor right I do believe that you um it it's totally acceptable to have deals not work out or deals fail or things to but the manner in which it happens um is very telling of of an individual right um and I you know would want to know if I was an investor in a company and and it didn't work out I would want to know that that entrepreneur did absolutely everything they could in their power to you know try to try to make it right and was open and honest and you know I've I've tried to be that way um I want to be very clear uh you may wish to check in with me uh you know in in some period of time down the road because it you know our our future is is not certain by any means um but at the same time um I feel far more confident now than I ever have uh since since owning the company and I I feel that we're doing the right things and I'm proud of what we've done um and uh you know just feel that uh good things are are in our future but um that we we won't lose sight of you know how how hard it's been and how easy it is to lose and and when you do buy that second and third business will do you see yourself being an owner operator again operating again or are you like okay I've got my operational chops now I'll you know run things at arm's length because once was enough I I may have to pass on the question I I remains to be seen I I I I could see both I I do like being working day to day um in a business I also um recognize that there's folks that can can do it far better than I and and if um I had the right managers in place um and that could scale up my ability to buy more deals I would I would 100 do that I think um but knowing that um I have the ability to get under the hood if I have to um isn't is is very valuable um so you know I I I don't know what the future holds but um you know I'd like to see um you know it it's certainly I'm in the right place now um for for where we're at great Jesse if people want to reach out um do you have a preferred way email LinkedIn yeah you're on Twitter yeah I have I'm on LinkedIn uh at Jesse Sapphire um I um you can certainly email me anytime at my company Jessie abgprint.com um I'm not a big Twitter guy maybe should I should get more involved on Twitter but um I've mostly been focusing on on LinkedIn um and uh always uh appreciate uh reach out I love connecting with people in the industry and um love uh sharing any any advice I can as long as you know folks recognize that uh free advice should be taken uh for what it's worth Jesse thank you very much for coming on this was a blast and uh really a um an impressive Story of Survival a war story really covet was was kind of like wartime I imagine especially there in the middle of Manhattan yeah so um always always better when those War Stories are ones of Victory and and I I'd say you're you've already been Victorious I know I know you're holding out you're not you're not declaring Victory just yet but you you certainly seem well on your way so congratulations on that um and thanks again thank you so much will this was terrific I appreciate you giving me the chance to talk about ABG and tell our story a little bit I hope you enjoyed that interview make sure you subscribe to the acquiring minds Channel below we are now publishing twice a week so tons of new interviews and stories to come stories that will help you along your own path to acquiring a business