The Joy & Pain of Buying a Tech Business

It was startupy in the sense that the scale allowed for little structure in the back end to just to be there in terms of CRMs and financial models. And a lot of those things were startup B, but the track record was already there. Anybody who knows the world of traditional search funds would probably recognize the name Relay.

It's one of the handful of funds that invests regularly into this asset class. Is that a fair way to put it? Yeah, that's correct.

One of them did a second search fund and then they moved on to other things and started investing in as individuals in search funds. So that sort of that, you know, coming from Stanford Business School allowed them to build that, you know, that network that they still leverage today.

Yeah, that chronology of searchers, then operators and then I guess one of them, a second time operator, second time searcher and then investors is the common pattern. You know, you, the becoming an investor is sort of the end point after you've earned it. And in some sense you went in reverse.

Now, maybe you weren't an investor, you were working for investors, but you were doing the motion of investing.

You were diligencing these deals and talking to these searchers and, and doing a lot of the analysis of search investing, lower middle market investing. What, what made you want to go from that position where a lot of people want to end up into being an operator? A few things. It's a great question and it's a rare path for sure, but a few things.

The first one was being an investor is intense in the sense that there is a lot of deals you're looking at, but to some extent you're looking at deals from the sidelines, right?

You are coaching the searcher who's playing the game on the field and you're supporting them and coaching them, but you don't actually have your shoes on and you're not running behind the ball in a way. And I had never done that coming from investment banking. For me, doing that playing the game at some point was interesting or exciting and I wanted to try it at least once.

I probably have 30 years ahead of me, so I could spend a few years searching and operating just to get a sense of what it is like. And the second reason Will, was because I was already sitting at boards and sometimes as a board member, sometimes as a board observer, but throughout my interactions with searcher CEOs and other board members.

I realized that the best investors were the ones who had gone through the search journey themselves, who could speak from experience, who could tell stories about war times when they did this and that and how they solved it and their mistakes and all those things. And I was the Goldman guy, you know, really good at financial modeling, but not really having war stories to tell myself and rather…

And I felt like, you know, if I eventually want to go back to investing and be a great investor, I'd rather get some scars myself and you know, and be able to speak from experience. So those were the two main reasons why I switched over to search engine. Great.