How To Get Acquired as a $10 Million DTC Brand

Nicholas Weiksner is the CEO and Founding Partner of South Col, an accelerator fund partnering with e-commerce brands to maximize sale value. With experience in venture capital and private equity, his skills include finance, negotiation, business planning, and mergers and acquisitions. Before South Col, Nicholas served as the CFO for SellersFunding, a global fintech company, and worked as an Investment Banker for Thomas Weisel Partners and Bear Stearns. He also held operational roles at fast-growing tech companies and for the San Francisco 49ers, where he managed sales for their $1.2 billion stadium.

Here’s a glimpse of what you’ll learn:

From managing sales for the San Francisco 49ers to launching an e-commerce accelerator: Nicholas Weiksner’s versatile career journey
What should $10-30 million brands consider before getting acquired?
How to forecast your brand’s future
Advice for founders to remain focused on exiting
The barriers to getting acquired — and how to overcome them
Why multiples increase above $2 million of EBITDA
Market strategies to accelerate multiples
Nicholas’ market projections for 2024
Nicholas shares his passion for inner-city education
Did Nicholas’ friend really date Jerry Seinfeld?

In this episode…

Many people with eCommerce companies that reach the $10-30 million mark consider selling or exiting. This can be a valuable opportunity for founders looking to kickstart their next endeavors. What should you know about getting acquired, and how can you position your business as an attractive option to potential buyers?

eCommerce M&A facilitator Nicholas Weiksner maintains that your numbers are the most valuable aspect of your business. While finances and accounting aren’t sexy, you must gain visibility into each transaction and expense to identify inconsistencies and modify your processes. Eliminating products, services, or processes that stunt growth optimizes profitability for a sale. Additionally, potential buyers evaluate your multiples, so by aligning your metrics with current market trends, you can increase them. This may involve accelerating customer engagement tactics to drive additional sales, developing models like subscriptions to generate recurring revenue, or expanding your top-line products. Aside from knowing your numbers, Nicholas encourages founders to establish a few objectives and focus solely on accomplishing them to advance acquisition prospects.

Join William Harris in today’s episode of the Up Arrow Podcast as he invites Nicholas Weiksner, the CEO and Founding Partner of South Col, to speak about preparing your e-commerce brand for an acquisition. Nicholas talks about forecasting your brand’s future, his market projections for 2024, and how his friend happened to date Jerry Seinfeld.

Resources mentioned in this episode

William Harris on LinkedIn
Elumynt
Nicholas Weiksner on LinkedIn
Nicholas Weiksner’s email: nick@southcol.com
South Col
Team of Rivals: The Political Genius of Abraham Lincoln by Doris Kearns Goodwin

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Sponsor for this episode

This episode is brought to you by Elumynt. Elumynt is a performance-driven e-commerce marketing agency focused on finding the best opportunities for you to grow and scale your business.

Our paid search, social, and programmatic services have proven to increase traffic and ROAS, allowing you to make more money efficiently.

To learn more, visit www.elumynt.com.

Episode Transcript

Intro 0:03

Welcome to the Up Arrow Podcast with William Harris, featuring top business leaders sharing strategies and resources to get to the next level. Now, let's get started with the show.

William Harris 0:15

Hey, everyone, I'm William Harris. I'm the founder and CEO of Elumynt. And the host of the Up Arrow Podcast where I feature the best minds in e-commerce to help you scale from 10 million to 100 million plus, I'm excited about the guests that I have here today, Nicholas Weiksner. After time working on Wall Street, Nick has gone on to fund multiple high growth companies. before founding South Col. He was the CFO of sellers fi, South Col joins forces with e-comm entrepreneurs to scale their companies for a Dream High Value exit in 18 to 24 months. Nick, it's really great to have you on the show.

Nicholas Weiksner 0:45

Thank you for having me a pleasure to be here. Yeah,

William Harris 0:49

so I do want to do a quick announcement of our sponsor, then we'll get into the good stuff. This episode is brought to you by Elumynt element is an award winning advertising agency optimizing ecommerce campaigns around profit. In fact, we've helped 13 of our customers get acquired with the largest one selling for nearly 800,000,001 that I uploaded recently, you can learn more on our website@elumynt.com which is spelled e l u m ynt.com. That's enough for that. Let's get on to the good stuff. You were with Bear Stearns, then the 49ers, CFO, there's so much to your past, how did you go from all of that to where you are now? What's the story? Well, I

Nicholas Weiksner 1:29

mean, the basic thing is, I think I followed my passion everywhere I went so so it's it is a winding road. But but it actually all makes sense if you're crazy enough to put it all together. But the the easy way to understand that is I've always had a passion for growing companies for for the challenges, just I love I mean, it probably dates back to you know, athletics has been a big part of my life that in athletics, you really have to work a lot on yourself, like by yourself with no one watching, if you want to be able to perform when the lights are on. And when it matters. And I look at growing companies a lot that way that like when you're there and in it, you've got to do a lot of stuff that sometimes it's just mucking out the stable, and it's not. And it's not trendy, but you need to do it, because that's what gets you all the other stuff. And, and I love the team aspect of it, because I've yet to see a company that doesn't succeed because of a broad, I mean, there can be a great leader at the top. And he or she can be a North Star that everyone's following, which is great. But I always see that they're those people attract great teams that that people bring and their talents are exercised, and they work well together. And they support each other. And it's you know, for us, especially at South Col because of the depth of our relationship, we actually have a screening that we look at entrepreneurs on like a 40 Questions sort of matrix that we sort of look at as a partnership group, because we realize that we're gonna get married to this company. And we want to make sure that we're that they align with us on a lot of things outside of business, you know, because the world is bigger than just just am I gonna make more money on this, which I mean not to, that's very important, too. But, but there's,

William Harris 3:17

there really is, I appreciated you talking about just that idea of being competitive and driven and athletics and where that's gone. And having to put in the work by yourself. It reminds me of a quote from Usain Bolt, where he said something along the lines of like, I've practiced for four years to run nine seconds. And I love that quote, because it's so good. We're so narrow minded, myopic, sometimes in growth, and we're saying I implemented this new strategy A week ago, and it's not hitting yet. Give it some time.

Nicholas Weiksner 3:46

That's right. That's right. You got you have to understand it. And that's where you have to set the right expectations. Like, when we do things we always want to lay out like, where are you going to see it? When is it gonna come? Like, things don't happen overnight. And every company I've looked at, especially the really successful ones they churned out I mean, let's take easy Amazon, Amazon spent a decade building where it was unloved for a long time. And then really put like, the point was, Jeff Bezos was just grinding and just work. He knew where he was going. And it took a while for the rest of the world to catch up to how far ahead he was of everybody else. Absolutely.

William Harris 4:21

Well, let's get to the meat of this, then. Let's imagine that you are a 10 to $30 million dollar e commerce company in you want to be acquired. What are the biggest things that they need to know?

Nicholas Weiksner 4:35

Well, I mean, it's funny I start so as a CFO, people think that I'm biased in this regard, but a lot of times super successful entrepreneurs. Accounting is not sexy. That's one of these mucking out the staples parts of those that that very few entrepreneurs are like, You know what makes me excited accounting like I live and breathe it in. Yes, I get to do the box site. So I totally understand it, because because I get it like it's not. But it's interesting, I say that there's a lot that drives out of it, which is, number one, we think the number one thing is, every single thing you sell, you need to know exactly what that cost fully landed to your customer. So do you understand that on a transaction basis, every time you give them a widget, how much money is being coming back to you to pay for your overhead and everything else? Not directly associated with the cost of delivering that widget to the customer? And sometimes, you'll come and you're like, why have you know, 10,000 skews, okay, but you can't know 10,000 of those numbers, but you got to know the top ones, the ones that are driving the business. And you should have somebody who knows all of them sure that you're smartly going, why are we doing this? Like, if if there's a reason, but then we have to know the reason? Let's Let's speak it. Let's talk it out. Yeah, go, we have this widget that loses us 10 cents every time we sell it. But we do it because it brings it brings in this $5 sale. That makes us money, right? I get it. But we should always know. So we're not just presuming it's such we should say look, and then let's test it out. Let's see what happens if we do some ads or push some people in where they don't see this. Do we still make that sale? Like sometimes we constrain our logic to go must be this because it's the way I've always thought of it? Where I'm big into having people I mean, it's I think it goes back to like, I don't know, if anyone like Team of Rivals, right. Doris Kearns Goodwin wrote about Abraham Lincoln, right, brought in a cabinet of people who disagreed with him. And I'm a big fan of saying, I don't want us to agree, I want us to talk. And intellectually, respectfully, say, ask questions. Ask go, why? Why is it that you believe backs? Can we show it in the numbers? So we're gonna circle back to accounting? Because every time I ask a question, I go, show me the numbers. Show me where sales increased? Because you did that ad, show me where customer acquisition went up. When here I see your recurring customer number is declining, it means you're losing customers. So let's, let's sort of drill into every number. And go what is it telling us? What does that number telling us? And if you don't like what it's telling us? How do we change it? Let's talk about solution based because I'm huge into let's identify a problem, then let's identify the solution to that problem. And sometimes you need to test you have to try, let's try three things, and see which one works better. And then sometimes you don't have that choice, right? Like, if you have a choice of like to either watch Product A or product B, sometimes you don't have a choice to do both. So then you have to have a team that discusses it, then everybody agrees and moves forward. Because if you can't go back and do it a different way, don't waste energy, like whether it was your choice or someone else's choice, just let's deal with today's problem. And they'll sort itself out. Because I always tell people, every closing dinner, I've been at what we've sold the company, all we do is laugh about disagreements, the only time disagreements matter is if we don't win. So if we all just focus on what winning looks like, we get to that closing dinner, where we laugh about all the times where you wanted to launch into Target, and I wanted to punch into Walmart, and you know, whatever, whichever way it went is the way it went. But like when you win, it washes it all away. And so I just to me, it's focused on all my energy. Does this make me when is this going to help a company? Yeah. And if it's not, yeah, let's stop off. Yeah,

William Harris 8:49

and I think what you brought up about the idea of SKU level understanding of what's going on in the business is very smart. We actually approach advertising from that perspective as well. Now, this doesn't make sense for every business, some people only have, you know, a handful of skews. But for large businesses, there are a lot of times that we see people with, you know, 70,000 skews, and they have no clue whether some of these are profitable to them or not. So we actually optimize the campaigns for them around which ones have the better margins, versus just which ones have the higher salaries, because you might have a higher return on adspend, a higher row as well, a lower EBITA. And so we're saying wait a minute, how do we actually optimize these campaigns in a way that drives the most bottom line, even if it means potentially lower top line, although we don't want that either. We want both to go up. But if we had to, we had to make a sacrifice on one. We're trying to figure out how do we make sure that the profitability is there?

Nicholas Weiksner 9:42

That's right. It's funny you said because I always say because we have this argument with not arguing discussion with a portfolio company where we realized that they were saying they had to get rid of we're just going to lower their sales. Like obviously when you get rid of something that produced 10% of your sales. That's painful, because you're tossing a 10% deficit off that bat, right. But by doing it, even if we didn't replace that sales, it was more profitable. And I said, then we can use, the more that profit we're generating, that now is bitter into growth initiatives that will be profitable and bigger, but you have to have a horizon that's beyond next month, which that also says, because one of my, in my past life, when I ran my private equity firm or mortgage, one of the roles I played was, I had been an operator. So I run a chain of retail stores. And I've been an investor, where I invest in I sat on boards, and invested their different perspectives, right, because investors just want the profit operators are working in the real world. And I kind of sat between them, where I can communicate to the investors, hey, in the real world, Joe's going through a divorce, Sally's having something happen at home, or things are difficult, they're gonna get through it. Or I have to be the investor and go, Hey, bud, I've run a company, you're leaning too heavily into the world is messy. You're, you've got to own up, you got to hit your numbers, like you've got to go do it, like, come on, and sort of that that medium where both sides trusted me because I could empathize directly with what their concerns were. And then what I found is it made it come again, we can do better outputs, because both sides have a point. Like, neither one is wrong. It's just it's not holistic, which is both sides really have their own value. And there's times for either one. And the hard part is knowing what it is, because investors are just like, I'll tell you what it is, I've got 30 of these, I'm just gonna whip whip whip, and the ones that fall down, fall down, and the ones that respond great. And I say, Well, let's think a little more nuanced view, because I wouldn't want my entrepreneur to take that view of like, this is what I'm just gonna do. So, you know, it's interesting. So but but again, it's it again, it all goes back to quantifying this ability. Like, here's an easy example. So a good friend of mine, John Advani is is had worked at major league baseball and he became the assistant GM of the St. Louis Cardinals. And I went to St. Louis all time love baseball, right? So once you say that was all the time and I would sit with John was like Mo who is this the GM and my buddy Amani, and their their discussions were abalone which is is data driven here at Stanford Business School, we came up together and like key base was like, if it can't be expressed in this formulaic, it doesn't exist. And then Moe came up as the scout. In fact, he's the scout that found our pools, one of the inner ring Hall of Famers who was drafted in the late 20s. Round. So he kind of found him. And so it wasn't through numbers. And this was through his ability to spot eye hand coordination, right through visual, subjective intake. And they were very much competition. And again, it kind of I laugh because I was working at mortgage like, I feel like I'm sitting between these two groups, again, where I'm trying to translate back and forth, which is like, John, to everybody look like Jeter did help the Yankees, we can agree that he was a weak, shortstop weaker than he is considered in the Hall of Fame as a huge Yankee fence. He's right behind me is, but he helped elevate all the players on the team. And you can't and you can't quantify what it means that every player showed up 15 minutes early to practice ready to practice, not messing around. I can't put that in a spreadsheet. But I agree with you that a lot of things can. So I would push back into everything isn't just what we see Billy Beane, was a five star five tool recruit, and amounted to nothing never got out of the miners. And, and so the point is, both have a point? And the answer is when I go to say, how about we take a little bit of the middle ground, which is we should be able to quantify it. And if we can't, every once in a while, that's okay. But if I hear you saying that about everything, then I go, You know what, let's find like 80% of stuff should be able to show him in a number. And if you've got a couple things that can't then cool.

William Harris 14:35

So a couple of things that you've talked about before with me in other calls that are maybe harder to quantify in numbers, but are really important for these brands to think about would be what the future is right. So you told me before it's like they need to know what drives their business, why they're successful and what the future of their businesses and sometimes when you're thinking about the future And, you know, you can go very simplistic about like, what the future is for the business, or you can get very complex. And sometimes the complex ends up being more wrong than the simplistic answer. But like, what are you looking for what you're trying to determine the future of a business? That's

Nicholas Weiksner 15:13

a great, I love that, because that's where it's the art and science where we keep we're circling around the same sort of thing, art and science and which is which, I would say that when we look at a company, the first thing that I sought on, and it may or may not be right, is, we look for a very specific type of entrepreneur. And the way I do it is I give a very good example, the one we're not looking for, is Steve Jobs. So Steve Jobs, you can't say he's anything less than unbelievable, right? He's not going to be we're gonna have a fruitful working relationship, because he is an idiosyncratic genius. And he is going to do really, really well, or flame out, or both multiple times. And that's what he's gonna do. And so so we actually soar into what I call the person who is open and receptive to simultaneously being confident. So I don't want a CEO, I don't want him or her to go, just tell me what you want me to do. Okay, no, no. Okay. That's it don't like that. Because you want someone who's like, No, I know this business. I know my customer. I know what it is, I know what I want to do. But somebody who when you present them contrary information, their reaction isn't to dismiss it, the reaction is to try to understand it, try to reframe it, try to recalibrate it. Because, you know, it's, sometimes you need to understand, I believe, we are the entrepreneurs we work with, I start from the premise, they know 50 billion times more about their business than I do. And so that is that's the information difference. But I can look at numbers and go, Why aren't these numbers reflective of what you're saying? And then open to learning where it is because sometimes that's where the opportunity lies. Sometimes that's, that's where, you know, there was one company I worked with, and, and she's like, my customers love my good. And nice, okay, but it's not showing up in this. And what we realized is where the disconnect was, she was Miss pricing her goods way low, we actually went and we doubled, the price doubled, no changes how her sales continued where they were to slightly up, she can't say that we lost sales. And the point was, it was because she was right. Her customers loved her good. But what was missing was, she hadn't thought of the fact that she was pricing it just based on what she had paid for, which actually isn't the way you share it. Rather, it's the value to somebody else. Somebody else was saying, I love this at 50 as much as I loved it at 25. And so as a entrepreneur, that's sort of where you want to sit is you want to understand what drives it. And then the other thing for founders, when I ran my company, there was a photography studio for families upscale. So our average ticket was $350. Right? So so a decent ticket for coming in for 45 minutes session. And all this. And I used to go to walk them when we were in malls, right? This is I'm old enough that we had actually mall based businesses. And we I walk the mall and with my, with my CFO, my partner, and he and I would like I would go okay, they're most of our buyers were mothers, I would spot so I'd be like, Okay, I could tell how much you would spend. And like, I can guarantee that they walk in the store. I would hit it 80% of the time, because it's not simplistic. It's not like oh, they're wearing a Rolex, they're gonna spend a lot No, no, no, no, no, actually, we add some dis correlation between expenditures. There's other things and you have to know what you're looking for. So when I talk to a CEO, I always try to see Do they tell me that thing about their customer? That's not obvious. That's not what anybody looks at this if you sell chocolate oh, I sell to people who like chocolate. Okay, well, cool. Instead of like going I sell to 20 to 30 year olds who like small batch chocolate because it adheres to their whatever the the answer is. I want to see Oh, who like visualizes what their customer looks like as an avatar as a as a general rule because again like you gotta you work with media right like then when you go to do your media buy you go look here the look. Here's the here's what we need to be don't be advertising if you're trying to reach you know, like you my wife teasing, right? I play fantasy baseball right? Which does not make me cool, right? Got it. But like, you don't want to advertise for fantasy baseball. In A community that doesn't like sports, right? That, why would you do that you want to find the sort of middle aged man who don't have anything better to do like, okay, got it. Like, there's my, there's my target. And that's everything I want to leave people out because like another one that I always get on, it's like my wife's a huge football fan. And it bothers her no end that people think only people that watch football or this, of course that I tell her Well, the reason is the wider market is the 18 to 40 year old men, you're in a narrower market, and but even footballs gotten smarter, because now you can bind narrower segment market and you can actually can go down and drill down and then hit these avid fans that are smaller, but deeper. So and so you want to know both and you want to sort of, I always like a CEO who just lives and breathes the business to the point that that's how they think of it in these minutia that, you know, the ones that are, you know, the ones that I stay away from are the ones that are like, Why don't you know, I'm very hands off, the sales is done by Sally. You know, accounting is done by Joe. No, man like, it's, you know, on the other day, like, here's there's about short sellers, five, right, we do loans to companies, right when and 1000s, beer, Ricardo, the CEO, the founder, still signs, every single loan that goes up, he looks at it sees how much it is inside. And I cannot tell you how many investors that were going. Ricardo whiting as he goes, because I am responsible for every one of these loans. And I want to know where they're going. Now, obviously, we have a team and, you know, I mean, it's not that, like he's reviewing the numbers by all this is just, he's watching what that is. And he has an ability to pull them at a ridiculous rate at a rate that, you know, you bring up swings, I remember that that was a week ago, I got you know, you know, he's,

William Harris 22:01

which helps,

Nicholas Weiksner 22:01

which helps, right, because all of a sudden, to me, it eliminates a lot of like future problems. Because like somebody comes and everybody in every job has their own self interests, and then they're trying to spin it the way that's best for them. But if you have a little bit more information, you can sometimes go well, let's unwind this a little bit more.

William Harris 22:24

So this is a good segue into something else you told me about. That's important for these founders, which is focus, where sometimes they get caught up in too many of the wrong initiatives for their business. And there is that line between having that personalization. But then figuring out what are those initiatives that are going to drive good revenue for you? When you're talking about focus to to founders who are looking to exit, what are the things that you're talking about?

Nicholas Weiksner 22:54

That's great. It's exactly as is. So we're looking at a company, right that did 12 million in sales last year, we're going to do hopefully, north of 20 this year, which awesome, right? Like that's from a bottom line. Super great. In building up to that, we I say that, like, okay, look, how are we getting there? We're going to create 9 million of revenue for the other 21 from 12 to 21 9 million of incremental new revenue. Where's it coming from? And so it's like, Okay, we're gonna do 2 million on the baseline business. We're gonna grow it 15%. Okay, I got it. That's reasonable, you know, maybe a little bit upside left there. But okay, got it. That's too. We're launching this business. That's a subscription box based business that we believe will do fortnight. Okay, great. That's high focus. We're launching into this channel, if you've never been in before southern QVC, it's going to end up being two and a half now. We're selling on Amazon, and this and another, another three months. Okay. Those are the CEO is talking to me. I'm like, those are big initiatives. So I have a belief in my very, very firmly held belief. We can be successful at three to five major initiatives. Any CEO, whatever man or woman is running it, I think it's three to five. Otherwise you degrade results in the others. And it's very hard to disaggregate this. Because you have entrepreneurs, you're like, I've done 50 things before. And I believe they have and but the hard part is you don't know if they wouldn't better off at doing five be very successful. It's hard to know we don't get to do that. But I know that where we are where it is. Then the CFO talked to me about this, this initiative, and I said okay, I said sounds great. I said how much is revenues is like half a million and I said if you spend an hour on this, I'm gonna be upset because 500 is not moving the needle. We got these other initiatives that are building up to the 9 million for exit. Remember, we want to get there for X it, there's 500, if you can't just give it to somebody else in the organization, who doesn't have 500,000 of value that they're creating, this is an increase in whatever they were doing otherwise, and we don't lose anything else. degrade anywhere else. I'm okay with it. But if this is on your charter, I have to understand why, like, what's the, why are we doing this, if it's not going to do do that. And it's because again, entrepreneurs are just so passionate, they want to do everything that they, they see a need to do one meet it, which is cool, but like my job sometimes just to random it a little bit and just go, hey, I want you to work hard. But I want you to see your kids, or go to the movies, or go to the beach or whatever you want. But like, if you try to say you're doing all of this, you're going to lose all of that, and maybe not.

William Harris 25:57

Yeah, yeah, you've got to find that balance between the two. So you can focus on the things that are driving the needle. And I see this even with brands that we work with all the time, where, you know, there's a push for an initiative that or a test that isn't going to make much of a difference one way or another versus installing on other tests that are gonna make big impacts. And I think some of the times, the reason why we do this, as human beings is because there's comfort in the simple things because we feel like, okay, I cross it off my list, right? So it's like one thing, and it's one small thing, but like, the other one feels maybe overwhelming or daunting, it's like, I'm not sure if I'm ready to do that yet. And so, at least this is why I rationalize why sometimes maybe even myself included on certain initiatives were like, Ah, I'm gonna Friday. Today, I'm gonna work on this one, this one, I can knock off my list or my feels good.

Nicholas Weiksner 26:45

That's right. So it's the tyranny of the urgent versus the tyranny of the strategic, right, which is, yeah, the other one that happens is you start doing this, all those little things have their little mini fire drills, right? Whatever initiative, right? I don't care, whether it's lesson, everything, I've found a $500,000 initiative and a $5 million initiative, sometimes have 10% more work for the larger one that you know, that did amount of work of starting something, whether it's a lemonade stand for your kids out on the corner, or, or a major like are kind of similar. And then what happens is, you get the inevitable fire drill, because something didn't go right in that and then all of a sudden, you're taking that phone call and not focused on exactly what you said, which is the the thing that's going to actually sell your business for 60 million versus 40 million. Like, that should be the, that should be your focus. If I put it like that. Most people are like, oh, yeah, of course, I'm gonna focus on doing that. That makes me 20 million. Okay, well, let's

William Harris 27:47

write. So you told me a story about ace Greenberg, when you're at Bear Stearns, that relates to the idea of focus and where you're putting that focus there. Tell us a story

Nicholas Weiksner 28:01

as so. So, first of all, again, this is gonna show my age, which is so when I came to Wall Street, fresh out of college, first job out of college working at Bear Stearns, corporate finance analyst and, you know, we have the class of the 100, you know, suit wearing first job all ready to go work 100 hour weeks, and EastEnders himself, you know, he's, you know, he's kind of his godfather, the company's amazing trader, he was pretty old, back then. But he still came to work. He was there before the market opened there after the market opened and still executing trades. And he gave each one of us a little paper bag. And one of the things inside of it was three paper clips. And a note that said, we used to get paper memos back, this is paper, you know, it was we had email, the internet existed as my kids like to think the internet existed, there was email, but most of the stuff was done paper, especially deal related memos, and you print out your spreadsheets, and people would look at it with pen and paper. So you'd get memos and it said, when you get a memo, take the paper the book, you have three to add to the system. If you're doing this, as long as by the time you send your third memo, you've received a memo which will happen. You don't need any more paper clips ever. So our supply store in the building doesn't have any paper clips. And the point of this is because if you're watching the paperclip, if you're thinking I need to take the pupil and do this, you're watching our money. And you know the old adage, if you watch pennies, the nickels take care of themselves. And that's stuck with me, which is obviously it's a bit ridiculous, but I think it's intended to be ridiculous, but it's saying sometimes lots of little things add up, you know, lots of well, I'll just go ahead and do this anyway. It's better to Yeah, if you think about the small things, the big things workout, I think I hold that still. And it's guided me a little bit for, you know, four years later or whatever. So 30 years later?

William Harris 30:10

Well, I think like you said, it gives you focus, right? So it's like, okay, if there's only three, these gotta go to three things that really matter, not all 30 things, and then your focus is divided, and you're not really rolling in one direction. And it's, I'm just gonna mix up a whole bunch of metaphors all at once here. So that it works better. Exactly. So if if somebody's looking to get acquired, what are some roadblocks that you've seen them run into where you're saying, this is a dead stop, or a red flag, or whatever that might be that you're like, you've got to get this sorted out and fixed, or you're just pausing the whole talk about acquisition. So again,

Nicholas Weiksner 30:51

I'm selling a beating horse, but I'm gonna go back to what I said at the beginning, which is the most important thing of what we focus on, which is your your numbers in your accounting, because when you report numbers, many, we see companies that are in the 10, to 15, even 20 million, and even even above, whose accounting is what I would call be, its most mostly accrual. There's some stuff in there that they didn't think about, that's a little bit cash based. And it's very good direction. So we're really, we're miles away from fraud. So everyone needs to understand what we're dealing with. So you get into areas of fraud, which I've uncovered. I mean, anyone who's done due diligence, enough companies, I've found stuff that whether it was fraudulent, or absolute incompetence, we just go away. That's, that's like Good night, we don't need to talk anymore. I got better things with my time. So we're talking about companies that are well run by honest people. But the numbers, you I was always confined fairly five to 10% numbers that can be moved. Sometimes it's because it's our choice of how you classify something. Sometimes it's, you know, understanding where what time periods things are happening in and where we should affect them. So those all will run the course right? And it's okay. But when like, when you come to South Col, one of the first things we do, we actually undertake, getting them so that they're what I call a, which says there pure accrual. Now you also have cash books. So you have both. So if someone wants to see your cash, because when you have a cruel, it matches cash, and you can, that's, that's how it works. And all of your statements become very quickly exactly what they are. Because if you go back to what I said earlier about how we always look at the numbers, we're driving the business off of that, we're looking at what you're doing, because a lot of times businesses think a lot about the top line, which is great, as you're growing a business, top line matters a ton. When you're going to sell a business, a lot of times your bottom line is going to matter more now, some companies still are acquire on revenue multiples, there is less and less. We believe that the highest sales come from companies that are getting their EBIT above 2 million, where you can start selling to real strategics. And I can get into why they pay a higher multiple, because it's not that they're stupid, there's a reason they power multiples, but you want to get there. So they care about the bottom line, and your business should be driven off. And so what I say is, this is 100% circular, which is we need it to understand your business. So we're going to do it, then we want it ongoing because we want it to help manage the business for you to guide your business with it. And then when we go to sell like we sit down and we hand it to the people that are bidding on prospective sale, they know those numbers are right, they're just they can waste their time and try to find something that they're not going to. And what that means is in their headers can be a higher multiple, because they just know I can look at this trusted, I don't need to discount in my head, a sloppy and like one example I told you about which I can't say the name of the company, but when I was at Bear Stearns were solid company and the company was going through and $6 million acquisition that was the company's being acquired. And we were representing the selling company would probably be an acquirer. And going through it. They found an accounting error. And the accounting error was not de minimis, but it was it existed. It was not fraudulent. It was a it was a mistake. We corrected it changed the multiple, which would have made the business sale at 58 million. And, and so the okay so we're like okay, we got it. So 68 million. The company acquired came back said no, we're only going to pay 53. And when asked why they said Well, we found this huh We understand there's not fraud that we're buying the company and all this, but we're giving ourselves room, because what is the error? We didn't find? Because this one was pretty, you know, we understand how it happened all that footsie. But what if there's another one. And to me, I just took that lesson. And it's just and I've said to everyone said, you don't want that, like you don't want to be facing now, maybe it won't be that dramatic a change. Maybe it's maybe it's half a million dollars. But whatever that number, that change is, A, it's way better to have somebody do it, right, that's going to cost less. And then to, there's always the binary of I've seen people walk away. And I think a lot of times, when you dig into why they walked away, they walked away, because they saw something in the numbers, that didn't work, and they just they made the decision, do I have enough choices, I'm gonna do one work where I don't have so so I really sort of say like, and it's in my last and I'll get off this high horse of accounting is is is is, it's easier to do when you're at 1015 20, than when you're at 40 5060. So let's do it now. Because once you get it, right, it actually ongoing is just as easy as not being right, it just takes work to get it right. And I tell younger companies do it when you're at 5 million or 6 million, and then be right when you come up and you're gonna get a higher valuation for whatever transactions you're doing for that. And the other big one, I think that is is is is modes for the businesses, for the CEO, he or she has got to be able to explain why their business isn't at risk at any moment of a copycat or a light business. And I think you and I were laughing about this, this is in one of our times, which is every entrepreneur says they have no competitors, they always do the charts that are four squared, their upper right, and everybody else is laying up their way up there. And I love that confidence, like me, cool, that's fun. But like, You got to be able to know who are your competitors, and what differentiates you. Like, it's okay to have competitors, you can be a great company. You know, Lexus has Porsche has whatever, right? Like, there's more than one choice. And I always like when CEOs can say, here are my competitors. But here's what differentiates us. And sometimes that's the, that's the only moat they have for another company we're in, they have a patent that actually protects the way that they do this service. So I know for at least 10 years as a 10 year patent, that for 10 years, they can't copy exactly that. Now, there's other ways to do that. But they can say we're the only ones that do this. So like there's different levels that you might have have of protection, you know, iPhone, right, they have a ton of patents on what an iPhone is. Now, other phone companies have produced smartphones, right? So it always remotes going to be a different size. And it's always good to be able to understand what that mode is both whether it's it really, really wide. And if so why? And if it's not, how do you succeed in that? Because we have another investment that's in a commodity business. So by definition, the commodity business, it's right there in the word, it's a commodity, right. And so but they're still differentiated, and they still have moats that they do, but they're obviously operational, customer focused, packaging, I mean, things that are not very focused on, you have to not lose the focus.

William Harris 38:43

So the more that you can clearly define these moats, the better your chances of being acquired, are potentially even increasing the multiple. You know, you're talking about getting off your high horse of finances, I don't think I'm gonna let you off of that yet. Because you also called out the idea of, of why they pay better multiples when you get above 2 million in EBIT. Let's talk about why you get a better multiple there. And then let's also talk about other ways that businesses can drive up and get better multiples, on on whatever they're trying to sell. Okay, yeah. Okay, so

Nicholas Weiksner 39:17

number one, strategics are going to pay a higher multiple, and the easiest most concise way to do it is say strategics operate at a higher level, they're going to spend more money, they're going to be able to accomplish more. But what they need to know is the binary outcome of if this is something that will work. So let's just take an easy example of if you've got a onto a handbag right and it's like look, you show that your handbags are saleable to $10 million dollars of sales for 2 million in EBIT dot strategic comes along and goes okay, I've got 1000 stores so I can come and pay overpay on the multiple and I put it in there. have quotes, because I know that I can take this hand by which I know passes the one zero binary of whether people want it. And then I can put it on all 1000. store shelves, know that it sells. And if you, if you take my overpayment by increased multiple and spend it on a per bag basis, it's two bucks a bag, and I pay it back in the first year. And now I own your company. And I'm leveraging that brand where I add on a purse and a scarf, then all of a sudden, I'm able to broaden your brand, and now I'm making all of that back and then some so I underpaid for it. And it isn't the truth is just no the markets, the markets efficient, the market saying they can do that. You can't you being the entrepreneur, me, you, whoever, we can't open up 1000 We could I guess Sorry, I'll take it back. We could, but it might take us 510 years. And and they can do it. And know they can do it. Instant, like we had a competent, we ended up not turning down and one of the reasons was, at first thing, I have the opportunity to launch in 2000 targets. And that's amazing right now, really, really good. But the problem was, he wasn't fully understanding if he wasn't ready to do that he was not going to be able to be able to buy the inventory, had it. Maybe he doesn't need to sell through rates and they push it all back onto him. You'll go under, like, that's it like there's no like, yeah, talking about it, there's no like, we saw this, it's death. And we don't want to take a binary risk, that's death. Whereas a strategic can open up 2000 shells at at Target. And it's one of 10 minus 20 risks they're doing. And if it doesn't work, they're not they're not out of business. They're just it's one of theirs that didn't didn't work. And when you don't see that you sort of that's where you get those are the big swings. Sometimes the grand slams, and then sometimes they're strikeouts. And so like, yeah, it's a different perspective of, of what you want, if that's why they'd be higher multiples and other ways. You said other ways to get higher multiples?

William Harris 42:25

Well, so before we jump into some of the other ways here, too, I mean, I've seen this happen in the publicly traded company space as well, where, again, if they're acquiring somebody small, it doesn't really mean anything. But if they acquire somebody large enough, they're almost paid back within the day, because their stocks trade up significantly as a result of that. So it makes sense on what you're saying. But yes, other ideas, other ways people are able to build up their multiple if you're smaller, 10 million 30 million, you've got 1,000,002 million in EBIT. What are some other ways that they can increase that multiple, I

Nicholas Weiksner 43:01

would say, your client, your customer engagement. So if you can show you have a true group, where I always say this, some companies are very effective at making their customers, their friends. And when you can really sort of show that your customers love you. Because you're providing you're meeting a need that they have in a way that makes them happy. You're gonna see it a number of ways, besides you're gonna see it and repeat purchases, depending on obviously, it's got to be consumable. But let's just assume that we're dealing with lots of consumers like, okay, the repeat purchases, they're advocating, they're on Facebook pages interact with either on your tick tock, they're creating people who will go and create stuff around you like, I mean, the one that gets me is when when I was at Stanford 2002 1000. Apple was just hitting the iPod, and we're just sort of coming out. And I remember vividly being on University Avenue, and walking up to an Apple Store and a guy walking out just a customer boy, have you seen this thing is unbelievable. I've got 500 songs on here. It's the best thing ever. And I was like, could you imagine being a company where your customers are out like preaching the gospel of like how good you are and show your

William Harris 44:29

logo tattooed on their body.

Nicholas Weiksner 44:33

They put on their car Apple still does it today cracks me up, right? They give you that Apple sticker like I'm gonna want to put on my car that I have an Apple product like it's a little little hubris now but I get it.

William Harris 44:48

But yes, yeah. Customers.

Nicholas Weiksner 44:51

Yeah. Customer Engagement. Then I would say another big one is is for us. We feel strong is like the more if you If you're in a business where subscription can be there, subscriptions are great, right? recurring revenue, recurring revenue, because that's the most predictable. People love Predictable Revenue. But sometimes it's not, you don't not every business fits into that mold. higher multiples are going to be where you are very successful in a specific channel or region, and you haven't expanded to the others, because there's a cost to expand to the other. super valuable because that's, you know, something. So like, some highly regulated companies are going to be like that, where if you have to get approvals from from governmental organizations to go in, that takes time, money expense, if there's logistical challenges to expanding beyond territories, those are ones where you can sort of say, because they can look at the full map and go, we can do that we can we can accomplish those challenges. Those are probably some big ones. I mean, I think the other is, oh, as in others, if you can really define why your product has breadth. And what I mean by breadth is means. Can you expand out from it? Does it logically make sense for you, because you're really good at this product, you'll also be able to do this because strategics, love, love purchases that fill product lines for them feel like they have a home, they're like really good at selling in this spectrum. But they're missing like a little piece of it. And if you're that little piece, they're willing to pay because they want, they want to own that area of spectrum. Those will be the top ones I can think of I'm sure there's others, but but those ones

William Harris 46:44

dropped? Yeah, well, a couple that I come to mind for my side as well, because we do a lot of analytics for the buy and sell side on different businesses that we've helped so and one which we weren't involved in, I don't think they have been But Stanley just based on what you're just talking about the stealing, or whatever, that are all the rage, if you're a 13 year old girl, those were sold to you know, construction workers. And so this isn't product expansion, but let's just say that you've been able to show that you can tap into a completely new market. That's another really good thing with without product expansion that you can tap into a completely new market, I think can help. And then another one that we ran into was value of a YouTube channel for business. So this didn't have nearly as much of an impact. But it was something that we were able to use to help a little bit where I you know, I don't remember exactly how to meet this 5 million subscribers, highly engaged audience on YouTube, that doesn't necessarily mean that it's, you know, seen in the revenue, but it's like, if you separated that outside of that business, what's that entity itself worth as well. And there's a way to be able to use that to kind of bump up that multiple little bit as well.

Nicholas Weiksner 47:53

Exactly. I agree that that's that's super, I mean, like, all that new media, when you can be successful on tick tock, YouTube, you know, fit wherever, is most relevant to where you're, where you're where your customers are. And then also, in line with exactly what you're saying. There's is there's also sort of efficacy of advertising, when you can show that like, there's up spend available that you've been increasing your advertising, and you've seen the multiples, hold the row as hold everything hold the idea going? Well, we've charted this up. Well, we know we can still turn it more we believe that that we haven't addressed everybody in this vertical. Yeah, that's huge.

William Harris 48:38

So you and I were talking a little bit about the market as a whole as well, as is a little bit of a shift from where we're at right now. But let's just say your thoughts on the market for 2024. We we've had a couple of rough years. In E commerce, I like to track one of the things we like to track is the percentage of total retail sales that ecommerce takes up, right? And it was going up and up and up. And it has a really nice parabolic look to it. And then COVID happens and there's this massive spike in 2020 2021, it comes back down, but it still follows the same parabolic line that it was on. And so still going up. But that said, it still has been rough for some brands. 2024 Good, bad. What do you think? So I'm so

Nicholas Weiksner 49:31

what I'll start from this is is is I was actually an economics major. And I love macroeconomics. I'm big. I follow it. And I also always tell people, you can try your best to use logic numbers, but there's a lot that don't add up. We're in a market right now where you go to the beginning of 2023. And you look at where inflation was what the Fed funds is, rates increase In an instance, which, in a vacuum, which we don't live in a vacuum is somewhat controversial, like if we don't live in a vacuum, so. But if we did, you would expect to see a contraction you expect to see, you know, consumers now expect you to expect to see unemployment go up. And you'd expect to see that that would be the softening that would then allow them to stop raising. Now they kept raising because those things didn't happen, the consumer kept spending, and the consumer spending in the face of negative consumer outlet on the economy, which also very indicative in the past, of futures sound. So one thing I always say is, so economics is very politics agnostic. So, to me, when I look at it through that lens, I look at it very neutrally, like, as opposed to in my personal life, I can have my own views. Through an economic standpoint, one of the things I've seen is some of these feelings of like consumer sentiment, have become an element that have become very politicized, where if you're on one side of the aisle and the other, you're gonna say one or the other, and it doesn't match. What you're seeing in front of you were before the world wasn't that way you actually differentiated, you can say, well, I'm making more my cars cheaper, I don't think the world's in terrible shape. Now, if you don't like who's in power, it's terrible. And if you'd like who's in parable, it's great. So I think there's some things there that we have to sort of start to learn that some numbers that used to be indicative are no longer indicative, because they're no longer doing what they used to try to prove what they were, they're not showing what they used to show. What are they about 2024? I think there's several things, I think, one, I think we've got a huge, number one, I tell companies like, everything's gonna be expensive. You're a media buyer, everything gets more expensive. So don't come to me, I told all the companies I work with you don't come to me and tell me that you're q3, and q4 were thrown off because media is more expensive. Put it in your model, I guarantee you to be more expensive. I don't care if you sell ice cream, which you think has nothing to do with, you know, whoever wins the White House. The point is, it will be more expensive. So So I always start from there. I understand. It's going to be a more expensive year on that front now from the general economy

William Harris 52:12

only agree.

Nicholas Weiksner 52:14

I, I like to be I believed in a soft landing. So I've been saying that, I believe there was a huge risk of of a bad event. I said that I'm more bullish of soft landing. And this is like q1 of last year than others. Not that I said it was 100%. And not that I said the others were zero. I just said everyone else is saying 10% I believe it's maybe 30 or 40. And maybe we're not looking through everything, right. But the point is all kind of we're gonna hedge our bets, we're gonna kind of tell you, it might be this, it might be this and it might be this. So whichever way it turns out, we're going to pull, you know from that. So I think it's going to be generally good. I generally believe in especially if we're talking to us based, because another thing that people talk about economics, everybody just well, Europe's got its economy, China's got an economy, everybody else has got an economy, the US has an economy, there's Latin America, but just looking at from the US focus for the moment, is I think it's probably going to go up. I think that the institutions of our government don't like election year, things to go down. So there's a lot of embedded things that will keep the economy sort of going. That being said, I think that in an election, there's a huge outcome that could really turn things on its head. And it's very hard to predict what that would do. So I think that's unfortunately, the best I can do is, I'm sort of saying, I want us to be firm, and solid, show that we're ready, if it's, it's shaky or changed. But I want us to go forward with the confidence that I'm looking towards, especially with our portfolio coverage, like we met with them in January. And they're going to look to sell sometime in 2025 or 26. I said, Whatever happens, I'm very bullish on that. But if you're talking to me, sure, your whatever happens, we'll figure it out. Our institutions will balance, things will still get done. And you will move up. So I try believe, sort of in the two year horizon will be good. There could be some real, real shocks and changes in q4. And I'd be ready for anything. But overall, I would say I'm positive for the most part on on on the US economy for the rest of the year. Yeah.

William Harris 54:46

I appreciate that. I think the biggest key takeaway that I have from that, in my own learnings in research and in what you share there, too is we don't know, but it's a year to move forward with growth. But be prepared because the economy is still fragile, and things could turn quickly. So just be ready. continue focusing on your bottom line while you grow. But but let's go ahead and start, you know, pouring into this and be prepared. I think the thing that you said there that we talked about a lot is, during election years, so much money gets poured into advertising that ads are going to cost more during that time. So write that into your projections. And I think that's wise versus being surprised by it so that we know is coming that's going to happen this year, no matter what. So unknown. That's right.

Nicholas Weiksner 55:38

That was a no, that's a that's like, like Donald Trump's, that's a known known we know that one. Yeah, we're good. But it's funny, you also hit on that, which is something that I do, which is, I believe, companies that are growing, they're losing money, it can be very advantageous for them. And so I understand it. So I don't, I don't not get that sometimes you're buying growth, right, that you're looking down the future. And you want to get to scale for all sorts of reasons, right? Operational leverage all real reasons. Not Baloney, but real. But one thing I say is, the one thing I know is like the greatest companies can grow, while they're making a profit, which is, I always say that to me, I break everything down to like, the simplistic because again, this is the economist me like, well, if I can pick pineapples at five per hour, and you pick pineapples at one per hour, but you pick apples at 10 per hour, and I pick them at three per hour, well, you know what, I should be picking pineapples, trade them with you for your apples, we're both gonna get more of both goods. And we're going to sort of do this is that to me what the great companies do, which is, they are and I say this a lot. But as you're filling a customer's need, you have to understand what is your if you're a true brand, a true brand, not not an ecommerce seller. But if you're a brand, you're solving a need, meaning a wish, or delighting the customer. And if you're doing that, your recompense should be the cost everything it took you to do that, plus some winnings for you for doing that. And so if you're not growing, when you're doing that, where you're taking something for yourself, 10%, let's say, I go, maybe you're not delighted, as much as you want to be. So maybe we need to change it, whatever it is, or whatever the steps are, but like to me, I sorta get down and I go, I know people don't like hearing that, because it's hard out there. Advertising is expensive. I'm having to spend 35% of my ticket on advertising and I can't make a profit. I go, Well, yes, you're right. You can't make a profit of yours by 35%. On your ticket on advertising. How about we look at it a different way? Why is your product price there? And why is it so expensive to bring product people there? There? It's one of the two things. And if you can lower your costs to build the product, and you're profitable, if you can raise the price, you're profitable. If you can take the advertising go, I'm being inefficient with my advertising, you can be profitable. solve one of those three, or all three, that's even better. But that's that's the conversation. And sometimes that's not always met with a resounding, you know, thank you very much, Nick, for such pleasant news. I mean, it's, it's kind of, it's the way it is, I think it is. Yep.

William Harris 58:46

I'm good. I want to transition into the personal side, then of who is Nick Weiksner. Let's talk about childhood first. There were some things we talked about with childhood and sports, passion for Inner City Education. Tell me about your childhood and why you have this passion for any inner city education. Well,

Nicholas Weiksner 59:14

it's interesting that this is what I'm most passionate. But I've always said that the way I'll know I'm successful. For real, like real success is if I could execute change, and have inner city children access to adequate education. The reason being that from a very young age, I was lucky, my my parents were, well off, we're comfortable. We're not worried about things. But I grew up in New York. And so I lived in and amongst a wide range of people and I played basketball actually up in the South Bronx in that city wide Basketball League, where I was the definite minority in terms of not being in there. And one of the things I saw is that to me, education is the only The only way to break a cycle of socio economic issues that we have, and one of my promises has never been solved. Because it's not a fun solve in what I mean by that is, if we were to invest and make it better get better teachers get better institutions get better access, and protections. And the results are going to take 30 or 40 years where that child makes it to college. They have a child who makes it to grad school. And then all of a sudden, the playing field is leveled, the playing field becomes the best and the brightest, I always say to people that I looked at the world a lot in the way that I do with sports, which is love. I walked onto a field, I played football in college. And when I walked onto that field, there was 100 players of the Duke football team. And they ranked you from one to 100. Literally, there's a board should know what number you are. And the point was didn't care anything about me they cared about performance, am I going to make the catch? Am I going to make the tackle am I going to do this. And they had no hindrance to where they're pulling their talent from, they pulled from everywhere, they took the best that they could. Now the problem that I pose to people's I go, I want our country having the best. And I don't necessarily believe that all of our best and brightest are actually coming up to the fore with the opportunity to make the amazing changes they might make, given that change. So I've always been very passionate about saying education, sports, because for me, I was on a straight arrow. I mean, it might the people who know me, this doesn't shock them. But I, you know, look, I trouble was my middle name. And I was just always in the principal's office, you know, just it just was what it was. But I always wanted to play sports. So I was kept it. Like my dad said he kept it somewhere on the fairway because I didn't want to lose my ability to play sports because I knew if I went too far, that's what would be taken away from me. And so when I was in high school, I taught at Summer Bridge, which is a program that takes kids from the South Bronx, it has kids from college and high school, teach them. We also do stuff, it's because it's a summer things we also do, like there's some sports stuff and some fun things. And this is not a competitive sport, but like, sort of doing that. And I did that. And it opened my eyes to sort of these kids were super gifted, because it was you had to apply to get in and the population even though it came from the South Bronx, which is one of the most socio economically, you know, hard hit areas that you can pull from the kids were super smart that often 90% of it came from single mother households. And they were, you know, making sure they were getting this right. So they were going through all this effort to find this program, apply to the program, pass the test to get in. And then these kids were in there and getting this sort of education to sort of helped them where they would help them all the way through high school to try to get because there was they were trying to bridge the fourth to ninth grade, because that's where you lose a lot of kids in the inner city. And so I did that. And in college, I worked at a local elementary school in Durham, you know what to do. So Durham had some harder neighborhoods and a little bit of a different population. But equally as social economically, it's sort of hard hit. And basically all of it where I felt that wish we could do better. We don't have our best and brightest going into teaching. And I wish we should teachers are great. So it isn't that I think the people I do want to teach. They're phenomenal. They are working their tail off, they're doing an amazing job with limited resources. And so anyway, fast forward, I've worked investment banking, and I decided that I knew I wanted to go to Stanford Business School to do a search fund, very specific thing that Stanford offered at the time. And I realized that I should also want to sign up for education. And, you know, I've always said there honestly, like, I also understood that this will be good for me, because I knew that if I'm applying to Stanford, they would highly value that I went and I did this, and I have this passion. And so I'm like, that's good. But again, both people are getting something. So I went to Denver, and I taught at an inner city school, Bill and Melinda Gates have given $5 million to do a small school charter. So they're trying to get administration to be class size was only 20. And each of the schools was 120. Kids. Were all the teachers that had weekly meetings where you're talking about, does Jill do well in my class, but not your class. Here's what I do to bring her in, right to try to all these best practices that you're trying to do. And then I also coached, so I coached basketball and baseball, and then I sport was I tied together as the freshman coach and I taught ninth grade. I told the kids, there very few people as competitive as me is, and it was like a board game with me can attest to I will try to win, however I can. But I also told them, I care about them more than winning. And they were required to get seven signatures a day from their teacher at the end of class. If they didn't have it, they didn't play. So if they lost it, they failed to get it. They didn't play. Now, could I have won a game or two more if I didn't have to? I'm sure I could have right. But we were getting 90% of my kids to all of their classes when the school percentage was around 20. attendance was about 20%. And the reason was, they wanted to play basketball. They wanted they wanted to do that. And I said the way to do that is through this and I think that's a great way to try to mix things that they want as far as that with with others. And so, I mean, it was an amazing experience. I mean, I was pretty lucky was a school that Chauncey Billups who, in the Hall of Famer play for Detroit, child of of Denver, you can't go anywhere, his brother as a teen. So I got to play Johnson came and did a scrimmage with us. And so I got to play with him. And was amazing, because he was

William Harris 1:06:27

awesome. Yeah. But

Nicholas Weiksner 1:06:28

what you really just the part that sad is, I left and went to business school, two years later, the school shutdown, that they just couldn't make it, even with this influx of capital. And that it just the school was unable to provide what it is when it closed down manual High School in Denver, in five points closed down. And the kids have to go to other schools because the school wasn't able to handle it. So it just makes me think that like, I wish there was an easy answer, because here you have Bill and Melinda Gates, I mean, given $5 million, not nothing. And they don't hundreds of schools, many whatever, not hundreds, but they don't a lot, right, they they go out. And the problem is their thoughts are right, their hearts in the right place. I agree with some of the stuff that they're just, there's more, the problem is that the problem is bigger than just that. And, you know, it's it's rough and, and so that's the point I'd like to see change. Or if there was one thing I could do that would get it is it seems to me that our country, we should be able to say that every kid through high school should have access to education, and be able to learn and have a safe environment where it's not dangerous to go to school. But it's hard. I mean, it's, it sounds,

William Harris 1:07:54

but it's hard. It's simple. It's simple to say, right, but it's the solution is complex. denounce it is not. It is simple in its idea, but very complex in understanding and what needs to happen. Yeah. And execution. Yeah. Which is tough. But

Nicholas Weiksner 1:08:12

yeah, so it's big. And that's so that's my, that's my one that like, my kids have all tutored. I mean, they've, they've shared this, you know, this is a, they all tutor this stuff. Because it's, it's, you know, like I said, I believe in two things, which is sports is the great equalizer takes away all this stuff that we see in our society takes it rips it away. And education is another one that we could get back, that'd be and it will also make our country better. Like, just like I said, Think of how many Steve Jobs is we've lost in the inner cities that he or she might have been that great, you know, that great inventor, and like we've, we've lost, like, we definitely have at some point, I can guarantee that that's happened. But you know, it's, it's, it's hard, but it's it's also one that's that's hard to know how to do it, like, how to how to change it and do it. Because if we've tried lots of solutions, you know, trying to take kids from one neighborhood and we're just one another that doesn't work and like, we've tried, like, we've tried different stuff vouchers, and there's problems there. But, you know, it's sort of like, you know, the antithesis of like the board meetings I like to run, which is, I could sit here and talk to you about all the different problems. And my answer would at the board meeting be like, how about we talk about solutions? The problem is, I wish I had switched because I would talk about and I don't so so I would love to find the person that does and find a way to support them in that endeavor. So I

William Harris 1:09:41

think similar to what we do in E commerce, it's AV testing, right? We just did more of these tests. And so we ran that test. Okay, great. We do this in a systematic approach to figure out what's actually working and then being able to use that to apply that a lot of people that speak with loud voices about what they think needs to happen. Hear, but not necessarily the right ideas. I'm fine with testing out many of those ideas, but let's do it in a controlled way. So we can actually see if it makes a difference and roll those out then. Yep, I don't have a good transition for the spec. There isn't like there isn't a like, I don't know how to segue from that. But you told me a story about sometimes I like to ask about, like, you know, famous encounters or things like that. Your friend dated Jerry Seinfeld? Yeah, I got to know more about this story. What's going on?

Nicholas Weiksner 1:10:32

So So in high school, my was a, my good friends. Were big party promoters. Right. So this is the early 90s was right when this stuff was sort of taking off. In fact, one of them was Jason Strauss. And he and he's the CEO of Tao group. So people have been to Vegas we've been, yes, yes. Well, not every time it'd be awesome. Australia, Europe anyway, he and I were football cap is gonna in high school. And anyway, to be part of our he started doing it in high school, which sidebar I turned down, so I don't want to work in the nightclub industry. And now I see how much is going on there, I realized, perhaps I should have been a little more open to saying, this is a pretty cool business to be involved in. But sideways. She was another friend of ours, our group on the newer in your city, you know, a lot of the kids that go to school there. And so she's another one. And so she's dating Jerry Seinfeld. And, you know, for this, we'll say she was 18. And so we're out and he comes, he comes, you know, into the bar. And, and it's actually a bar that I used to bartend at will say I was 21. And so I walk over and say, you know, Jerry, like, you'll I'll get you a pitcher of beer. And you know, I'll bring it over here. And he just went, he's pretty funny. And he just went in the corner. And he really didn't really want to talk to sort of anyone and I'm not someone who likes to bother people. Like, you know, I'm not gonna, you know, sort of do it. I brought over the the free, not that he needed free beer. So I'm gonna get that too. It wasn't like I'm sure he showed up in his Porsche parked out front, I was pretty sure to do. But anyway, I gave him he didn't really want to talk. And then and then I was talking to the girl who was dating was a good friend of mine. And she was like, he doesn't like, like, he feels that if you'd like talking to people is like hard for him. Because it's like, he has to be funny. I'm sure he is very funny. I mean, I've seen enough Seinfeld enough, Curb Your Enthusiasm to know that I'm imagining he and Larry David are pretty pretty incisive, pretty smart. Right? Very smart. And do it but you get it, like he didn't really want to talk around us. And then the part that cracked us up is we kept getting him on listen to the club that he wanted, wanted to go to. And, you know, he would you know, he enjoyed that, that that part of it. And, you know, they actually didn't date that long. They did it a couple of months. I remember it wasn't a huge, huge, a huge thing. But it was definitely a buzz of like, at a time this is 1993. And so we're talking, you know, right in the middle of Seinfeld, right? It was He was dominant, he was dominant. There was no doubt in who he is. In the end. He's very recognizable. I mean, he looks just like he looks, Nick.

William Harris 1:13:19

This has been wonderful. I've enjoyed getting to know you. Personally, I've enjoyed you sharing your wisdom with us. If there was one more piece of advice that you want want to give to DTC brands that are looking to be acquired, what's that final resting piece of advice.

Nicholas Weiksner 1:13:37

I would say have your business match your passion, and meet your customers where their needs are. And you're going to win would be my end of the day. Brilliant.

William Harris 1:13:52

If people want to follow you or they want to work with you, what's the best way for them to get in touch?

Nicholas Weiksner 1:13:57

Easiest way to get in touch with me is email me it's Nick. And it's at South Col which is southcol.co. Just to understand South Paulo is the final phase of Everest. So we're named very specifically, the entrepreneurs brought their brand all the way up the mountain, we just view ourselves as trying to help that entrepreneur up the last technical piece to get to that summit, which is Everest and that exit. So that's what South Col is. And so my email is just Nick@Southcol.com. And that's why you see mountains in the background of everything we produce, because we lean into being the Sherpa to help help help people get up the mountain. So we lean into our brand story, as I'm sure all of you with great brands out there do as well. And so yeah, that's the easiest way. You can always visit us on the web two, which is just south called that SEO. And we have all our information there and can be emailed from there as well. But those are the easiest and and you know you'll get me I'm happy to talk To anybody who's out there, it's always valuable. I learned so much about all the brands and value the discussion. And hopefully I'm able to return value by either introduction or working or doing anything else because it's a we're all in this. It's pretty. It's a huge industry that there's a lot of room for a lot of winners, and we just love working with these great entrepreneurs.

William Harris 1:15:26

Awesome. Well, Nick, you've been an excellent Sherpa for us today. I appreciate that. And thank you, everyone for listening. Have a great day.

Outro 1:15:34

Thanks for listening to the Up Arrow Podcast with William Harris. We'll see you again next time and be sure to click Subscribe to get future episodes.

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