(replay)Art of the Roll-Up: 40 Businesses in 4 Years

They would fall under those two buckets, right? So payroll software and getting rid of paper checks and investment in SEO, SEM, Facebook, things outside of Google in particular. But yeah, digital transformation and digital marketing would be two of the largest levers that we pulled there.

Great. And just a little bit more because there's an interesting history here on why this opportunity continued to exist. Yes, we understand that the profile of somebody who starts a music school is probably not somebody who's thinking in terms of private equity or roll-up or giant building an empire of these. They're going to be a teacher first and foremost.

And really maybe what... So I want to hear a little bit of the history here because I'm not saying that people are going to go out and... go after music schools, which is kind of now being done.

But what abstract principles might we learn from your case to find other industries with maybe similar characteristics or similar history?

Yeah.

So maybe a little bit of history on music schools.

So I mean, I think there's two factors that are relevant here. One is industry structure, and I'll come to that second. But the first is just sort of there's a natural predisposition to associate kind of arts businesses with nonprofits, right?

So there's sort of a blurring of that line that exists where... When you think music and performing arts, you think nonprofits in a lot of cases and charity and fundraiser and the need to support the arts in a way that they appear in many cases to not to sustain themselves on their own merit.

So I think there's that predisposition where, and I certainly I faced a lot of, it's easy in hindsight to be like, oh, well, we own 65 music and dance schools. And this is a large enterprise for people to say, okay, well, that seems obvious in retrospect. But when I had five schools or one school,

It was preposterous that this is what I was doing when I told my friends and family that I'm quitting my hedge fund job to go continue a roll-up that at the time had about $2 million in revenue. But yeah, so I think there's a natural kind of predisposition there where you think arts, you think artists. And again, back to the level of operatorship in the space, there hadn't been great examples of…

um and you know even the ones that were successful you know these are people that were making a good living in their community you know we see schools that gross you know maybe as much as two to two and a half million of kind of four wall revenue in their neighborhood you know maybe they're making four or five hundred k off that you know that's a great living but it's not interesting to a you…