Buying a Wide Moat in a Consolidating Industry

I was really keen to introduce debt. And so we were able to work with a lender. And luckily we had kind of already started this process in the spring because regardless of the acquisition or not, we were discussing should we do a recap and pay some of the preferred down?

Right. So it was a discussion that was already being had. So we were already moving with a couple lenders and getting term sheets. And then we got the acquisition under loi and we're able to move a little bit faster.

And you bought it with 100% debt. Right, so the lender paid for the whole thing.

Exactly, exactly.

You said you have doubled, that is, in terms of revenue, ebitda.

Yeah, Everything we had, obviously, as you kind of alluded to, we shifted our pricing strategy a little bit, which in the short term impacts ebitda, but in the long term it's great. So we shifted our.

Let's hear about that. Ania. This is, this is quite strategic decision to execute on. Tell us, take us through it, please, and then we'll start closing up.

Back to the business model. Right. So our business model affords us the opportunity to be able to do this. We had always been selling our service on top of the actual AED sales, and we were never discounting the price of the AEDs below, you know, kind of what anybody else is doing, because we always wanted to make a small margin on the aed.

It's the biggest ticket item. Why wouldn't we make margin on it? And also our service price has been unchanged since 1999 prior to this.

So we were in dire need of some new pricing. And we did almost a year of pricing experiments to come to this model. But we're selling the AEDs well below cost as long as they're purchased with service and for a minimum of two years of service.

And we know that our customers, if they stay with us for at least two years, we know that they stay for an average of 10. But we actually have a lot of customers that stay with us longer than 10. So that's just, you know, businesses close down, businesses fail, businesses go hybrid, go remote.