Leaving Wall Street to Buy a $1m Manufacturing Business

Yeah, right.

And so that's just an all. We all understand that that's just an awful lot of leverage. But then when you add to that that, that you don't even really know what you're buying.

Can I interrupt one second?

Yeah, please, please.

I did. I also think that is that the original model with the leverage is a function of that most of these started in the traditional search fund model. Okay. And if you think about it that, that that model needs leverage.

Yeah, yeah.

And so that's what was the foundational understanding of it. And, and, and you know, and obviously they want to keep the, the person that's basically buy the if you're running a traditional search fund, you want to keep the buyer's equity as it a little bit down. You also want to keep the leverage high.

But in traditional search funds it's not the 90% model. The, it'll be more of a conventional debt to equity structure on those businesses.

Right. But at the same point the leverage lies. The, the, the, the I, I find it, I, I find it to be leveraged aggressively. Aggressively. Yeah.

Okay. Okay. Well, and so, and so but your, your overall point here, the kind of Finance 101 is that depending on the attributes of a particular business, the amount of leverage it can or should support varies a ton. And, and you, and from the outside looking in, it's near impossible to know what that optimal amount is. So just a, just a really valuable learning there.

And so your point was you were going to get into the business and then decide what the optimal amount of leverage to put on it was. And you were, as you said, had the luxury of not needing the leverage to get into the business in the first place.