This Software Entrepreneur's Blueprint to $25 Million in Revenue

 Summary

In this conversation, Peter Oichman shares his entrepreneurial journey from Russia to the United States, detailing the founding and growth of his company, Core Partners. He discusses the challenges and successes of navigating acquisitions, including the lessons learned from his first and second company purchases. Peter emphasizes the importance of strategic planning, understanding market dynamics, and building a resilient business in the face of economic uncertainty. He also outlines his future goals for growth and expansion, aiming for a revenue target of 25 million.

Takeaways

Peter Oykhman moved to the U.S. in 1993 and started his entrepreneurial journey.
Core Partners was formed from a merger and has grown significantly since its inception.
Acquisitions can be serendipitous and require careful consideration and planning.
The first acquisition provided valuable lessons in due diligence and negotiation.
Understanding the market and economic conditions is crucial for successful acquisitions.
Building a safety net for the business is essential in uncertain times.
Peter aims to grow his business to 25 million in revenue.
Negotiating with private equity requires a strong position and clear goals.
Cultural and language barriers can be navigated in international business.
Learning from past experiences can lead to more successful future acquisitions.

 Watch the Interview:

Transcript: 

Jon Stoddard (00:00.428)
Welcome to the top &A entrepreneurs. Today I have Peter Oykhman. He runs a company called Core Partners, originally from Russia, moved here from 1993. And he's actually had two companies on the, or sees the same company listed twice on the Inc. Top 500 fastest growing companies. Welcome Peter. Thank you. So how did you, let's go back a little bit.

Did you have this company, Core Partners, when you moved here from Russia or just started it? No, no. When I moved in Russia, it was 1993, almost 20 years ago. I moved here on a working visa like a lot of people do.

basically then I got my green card and citizenship. But I worked as a software engineer first and then around probably 98 I started the first company, you know, with a with a very original name software technology. And yeah, yeah. So, so we were doing a lot of

know, software development around this, know, dot com and, you know, all this crazy stuff. I guess only a lazy person, you know, didn't do anything around that time. And then around 2003, we actually merged with my partner and created this core partners.

Right. So technically speaking, right. Technically speaking, core partners as a result of the merger of, you know, our companies. Right. How big is core partners? When you started then, how big was it and what is it today? When we started, it's basically was about, I guess, it was two of us, partners. And, know, my, since then my partner left. So it's just me.

Jon Stoddard (02:15.406)
at the moment and we had about 10 developers, I think at the time. And we also had a product which kind of a, it's a kind of a long story but we were doing a software development in this software technology company for one of the clients and the client went belly up, know, didn't pay us. So we owned the product.

And we just, like we're trying to figure out when .com crashed, like everybody else trying to figure out what to do. we, it was like, basically start, try to sell the product we inherited and we build it, but I knew nothing about the whole like warehouse management logistics at that time. So we actually sold a few licenses. And...

basically started growing and kind of hired more developers. And so it's been kind of interesting, but for a long time up until about three years ago, four years ago, we were growing kind of naturally and just growing. then frankly speaking, I was like, I actually probably...

you know, we were profitable. you know, we could, we could actually buy a company and the opportunity came up and we bought the first company and early last year we bought, you know, not the timing was kind of off with a COVID and everything, but we bought the second company and- let's go back to that first company. Sorry to interrupt. So how did this opportunity, I mean, was it in your ecosystem already? Yeah.

Were they a customer downstream or upstream? Yes, they were a customer. they basically they had a similar product in a similar space. And so they, they actually came to me and they said, you know, do you want to buy our product? So they actually approached you and said, I want out. Yeah. Yes.

Jon Stoddard (04:38.911)
Yes, that was an original. mean, it was kind of coincidental because it was like, yeah, I don't know. I guess, you know, with all of us, you're just waking up one morning and I was like, well, you know, I probably have to do something different. You know, I'm just, I don't know if it's a boredom or something else. I have to do something different. And it just coincidentally, I started looking at some, to do something else and, know, to, you know, do some, you know,

probably &A and they approached me. So it was kind of a sort of a happy, happy accident. serendipitous, sounds like. Right, so yeah, absolutely, absolutely. Yeah, so when you say similar product now, and this is kind of interesting because when I worked for Autodesk, they had 3D Studio and animation package. And then they also bought Maya because they found out.

in a production studio, they're used at different parts in the supply chain or the production chain. So they bought them for years and years and years. They said, you know, we're not going to buy a competitive product, but they sit too differently. So is that the case with your somewhere? So we, our core product, it fits into this like middle market. So, and I always kind of knew that we have this low market opportunity, like, you know, like a

inexpensive product for inventory, like, you know, small kind of a check-in, check-out kind of a, but I can't figure out how to address this honestly, just to be completely transparent. So, because it's a different product, right? So basically people, sorry. So people...

Basically, it's a self-registration involved and it's also kind of a low maintenance, hopefully low maintenance involved. So it's a software as a service, it's a cloud-based product. And I'm always, we were kind of a middle market kind of a on-premise installation, these sort of things. So was like, I really like to get there, but I don't know how to start there. Yeah.

Jon Stoddard (06:57.901)
So, that's companies, that's what they've been doing. And, you know, the biggest part for me was I was never really 100 % sure how to make money there. Because- they have paying clients or what was the problem? yeah, yeah, yeah, no, no, they had quite a few clients and we actually, we rebuilt the product, redesigned the product and we've got more clients and it's even more robust than ever.

But my question was like, if you are selling it to a client, like for example, $35 a seat or like for two seats, like $70, right? So how could you make money, right? So you either have to have like a lot of clients, Very large total address of the market. Right, so it's kind of a...

And the other thing was also kind of very, very interesting that, okay, you've got the clients who are spending like $35 a seat or like $70 for two seats, but then you've got expenses on support, maintenance, somebody will have to, they will have some questions, somebody will have to either answer like phone or, so, I mean, with such a low cost product, it's really,

wasn't really transparent for me how to approach this. So in that sense, I was looking at it, but I always had some doubts how to approach this. But these companies, they already build the product. They already had the customers. And I looked at their balance sheet, of, yeah, you actually could make money. Yeah. So when you looked at this, I mean, they approached you.

Were they looking for, I mean, why didn't they go to auction like a broker side or something like that? just got to you. We worked with them before and essentially we build a system at some point with them and they looked at our software. we knew each other and basically it was...

Jon Stoddard (09:17.057)
sort of a natural, so like we knew the value, knew the, we had an expertise, it's really, if we're starting from a ground zero in this space, in the sense that you have to explain what, where and how, where we could just skip all these interesting conversations and basically go to the question, how much and when. Yeah, does this product,

Is this product lead into your product? Will people buy this product and then buy yours? Right, right. So it's a smaller product and yes, some of these customers went to, know, kind of migrated to our product and such. Yeah. Right. So how did that negotiations go? I mean, did you pay what that capital stack look like? Did you pay out of pocket or was it a stellar financing?

or what? No, no, no, no, we paid from our profits. All right. So what was it? What were they asking? It was like seven figures or eight figures or? No, it was.

It was six figures. Six figures? Yeah. It wasn't, the product is not that big. So it was a six figure kind of sum, which was easier for us as a first acquisition. So we don't have to go and get some financing and such. And it was much, much cleaner. we don't have to wait. We don't have to deal with banks and such. So did you just pay out of your cashflow? You said, hey, I have this saved up and I'll just pay?

Yeah. What was the multiple on that? Well, I mean, that was a software. This is back in 1990. So it's not the crazy multiples you'll see. Right, right, right, right. So, yeah. So, yeah, it was it was a good number. It was a good number. It's kind of it was easy. That's the numbers they were looking for. And that was a number for us easy to digest.

Jon Stoddard (11:23.125)
Yeah. And did they stay on with you to help run it or did they go off? No, no, no. We basically, we just bought it. It was, you know, literally an asset purchase and we purchased some assets and, you know, they helped us for a couple of months and that's it. So where does that, I mean, where does that acquisition today for you? I mean, what does it mean? it, did it really help you understand acquisitions or was it really great, leading product?

It was really definitely a great experience. So in that sense, we had a really good structure and it's very important like, know, to understand the structure of the contract, you know, you know, how, what's going on there with the whole, you know, kind of what, what, what's, how it's supposed to happen. And so that's why I'm saying that it was a kind of an easy for us to digest because

you know, acquisition wasn't that big and, but we, did everything what we're supposed to do, like, you know, for any acquisition pretty much. All the due diligence and stuff. Right. Right. Right. Right. Right. Right. Right. Right. Right. Right. Right.

bigger revenue numbers for you now? Right. So basically, we already made way more money on the companies than you paid for it. Right. So that was an interesting, but it also was very good experience. So basically we're taking somebody else's code and our guys were kind of digging through the code and

you know, we making improvements, we had like a roadmap and what they wanna do, you know, where they will wanna be with a product and such. So as I said, it's basically like we went through all the right steps. It just was a smaller steps, which kind of was a really nice and easy way to, you know, get into this kind of- How was the code? mean, how clean was it? Because sometimes you look at an acquisition and go, that's really old cold and-

Jon Stoddard (13:44.237)
code and it's gonna be really bulky and rewrite it in a couple years. Right, right. It wasn't cool. It wasn't bad, but it wasn't great. So it was kind of a, it's okay. And the biggest part was you wanna, when you're dealing with software as a service, you wanna optimize the software for the cloud. And speed. And it's not only speed, but.

you know, number of virtual machines, number of resources. So basically better your Z, cheaper your cloud is, right? Keeper your platform is. And we've done a lot of that. And this product was also very much attached to Equibooks.

And what we did, we also basically decoupled them, that product from QuickBooks. So it could be totally like standalone product. So that was also on our roadmap. So we did quite a few things, but honestly, I mean, again, it's pretty much what we were expecting. So we didn't expect something like great because we had access to the source code before, right?

So we knew more or less what we're dealing with. So we- so wait minute. How did you have access to the source code? during a due diligence, they gave us an access to the source code. okay. Okay. So they just were open books, very transparent. Yes. Yeah. Yeah. So, and we had access, probably, of course, not to the whole source code and everything, but we had a pretty big-

piece of a source code that we could look at, we could see what we're dealing with. I had the same kind of, like, well, I really don't wanna, I don't know what I'm dealing with, so give us a piece of the code, so at least to look at what's the deal. Yeah, yeah. And so the price you paid for it, that they asked for, is it the same price they paid? Or was there any negotiation? Like, hey, I didn't like that code in there.

Jon Stoddard (15:58.133)
No, no, no, we of course, we negotiate it and it's like it's like it's every time you're you're negotiating when you're, buying a car, of course, you're if you're buying a company, of course, you're negotiating. Yeah. So why did they sell? What was their motivation?

it wasn't their main focus. they basically, was off their main kind. So they build it, they also made money on it, strangely enough, right? So they also made money on the product. But then, if it's not your main focus, you have to dedicate resources, you have to support the code. They didn't have a big software development team to,

As you can imagine, developers in Colorado is also pretty expensive and that was our kind of back end. So we had access to a cheaper resources and that's why I'm like, yeah, I know what I want to do. know how, where I want to go. So that was it. Yeah. So how was the feeling of then in negotiation? mean, it doesn't sound like, Hey, the guy is 75 years old. He wants a life changing exit. So I'm going to take my, I'm already rich. I'm going to take my time versus.

this product doesn't really fit in our core products and we gotta divest it. So let's make it out. Right. So basically it was very nice kind of a, so we both knew what we're looking for. So they wanted to do something else. They wanna get their money out and go do something else. For us, like we wanna add additional kind of a product. kind of.

it would take us much more money to build and to get to this phase, number of customers and such. So it was absolutely, we both, mean, I'm pretty sure that we both were happy with the deal and it's just, I guess it's a whole question of timing. It's very important. So they were ready to sell, I was ready to buy and we had, I think we were both happy with it. Yeah, sounds like the timing was just perfect. Right, exactly, exactly.

Jon Stoddard (18:08.077)
And you integrated that and did you find any complications with just the resources? I mean, you need people to work on a code and then people to sell it and then the people to support it. What did you encounter there? Nothing major. mean, again, because we do have a product ourselves, so we just added another product to the mix. So it wasn't anything crazy.

I mean, yeah, it was a normal kind of a pain with transition and getting people up to speed. of course we counter some bugs and some hardware issues, software issues like anything else. But again, it's not that we had the low expectations but we just knew that we had to deal with this stuff and we put a,

pretty good people on a task to kind of to learn everything. And then we would put it like a funeral developers after we knew what we're dealing with. Yeah. And how did that, I mean, how did this acquisition kind of change you? I mean, what I'm kind of looking for is like, my God, I could just double my revenue and one acquisition or what happened? No, it's basically, I guess I never really knew what to expect.

and you're always talking about this &A, right? You hear about this &A from all kinds of places. You just, you have no idea what you're dealing with. And that's probably the scariest part. And that's the first kind of a, like first you have to make a decision and then when you're doing it, turns out that, yeah, like of course now we spend on attorneys way more than we expected, but.

you know, as a first acquisition, but we pretty much then use the, you know, very similar contract in our second acquisition. So it's not like we wasted our money. What was the, why was the more time spent or more money spent with the attorneys? I mean, I guess the question is like, is there something about that acquisition that you could have done different and said, Hey, that was a great lesson for the next one. Right. So, so basically

Jon Stoddard (20:32.255)
Again, we both were trying to, and they had the in-house attorney and we don't, right? we- That sounds like a bigger company, yeah. Right, right. So, and the problem was that kind of they're trying to protect their interest. We had a very good attorneys who were trying to protect our interest and we were just going back and forth on a few issues.

Again, nothing unusual, pretty much standard issues, terms, conditions and such. But at the end of the day, and that's a good part, that we could both sit down at the table and basically talk to each other and that actually helps that we knew them before.

and so it was nothing like crazy kind of a negotiation or anything of that nature. Sounds like the right place at the right time. So fast forward, you're moving along, you get those integrated and this how did this other second one come about? Well,

That's kind of interesting because I was honestly ready for the second acquisition after the first one because I'm like, yeah, it's not that bad. kind of, it's pretty, I mean, the biggest part for us was strangely enough accounting because they were dealing with like payment system, like authorized.net. We haven't done anything with authorized.net and you have to create an account. of course,

the painful part comes like you have to talk to them and basically transfer their accounts to our accounts and it's just a pain. It's just, but it's logistics. But when you're trying to merge something or kind of split something with authorized.net, it's always a pain. mean, it's just like, so the second one,

Jon Stoddard (22:51.425)
Yeah, you asked me about the second one. The second one was different because frankly speaking about two years ago, I started looking at the economy and not to get too political, but you're always trying to figure out what's your best case scenario and what's your worst case scenario. And it was COVID and I'm just, know, know.

who knows who will go to the White House next, but you got the COVID situation that economy is not doing so great. So I was just trying to figure out who is, which industry and what area is more kind of a recession. It's not the recession proof, but more robust towards economy.

I I think that's a person, a great way to describe it, recession. Right, right. So that's actually basically, I looked at a couple of different industries and, you know, of course, I didn't know how, you know, COVID is going to hit and how political situation is going to hit, you know, what angle and it's certainly it's a gamble, but

I figured that if anybody will survive in this crazy situation, that would be SAP. Because typically companies who are using SAP, it's the biggest companies and they got usually pretty big budget and such. So to be an SAP partner and to do some SAP development, it's more reassuring. So I started looking and...

again, you know, kind of strangely enough, one one guy I knew before, he started talking about like, yeah, you know, too much pain, you know, I, you know, don't know what I want to do next. And in for him, it was a little bit different, because he reached a certain limit. And he didn't know where else, you know, how else he's going to grow. Yeah, I started talking to him. I was like, Well, you know, we could, you know, we could actually

Jon Stoddard (25:11.667)
buy your company and we could grow together so to speak. Because it's also question of resources and capabilities and such. Yeah, what was his revenue like? mean, seven figures or what? Yeah, yeah, yeah, yeah, yeah, yeah, yeah, yeah, yeah, yeah, so it's a good size. It's not a huge revenue, but again, as I wasn't looking for, because I didn't wanna again go and finance that. So again,

As you know, you're going and looking for some finance, you're giving up something. My dad's favorite expression is, the only free stuff in this life is a cheese in a mousetrap. Is that your dad is from Russia? kind of state the phrase. Yeah. Because he was in world

Did he survive World War II? yeah. No, he was born right before World War II. his childhood was during World War II. Pretty bleak for Russia. Pretty bleak for the whole world. It was pretty unpleasant times on all fronts. But in Russia, was especially not friendly.

So we had the relatives who went to these camps, Stalin's camps. so, yeah, was very, very much interesting. Kind of a purge there of the intellectuals and all types of directions. Yeah. Right. And pretty much everybody, every family had people who died during Second World War. So it wasn't pretty by any stretch.

And your dad kind of instilled that, you know, don't take on debt type of belief. Yeah. So, I mean, it's most traditional kind of a, know, in the Soviet Union, you know, like here is a little kind of history. was no credit. It wasn't, know... they don't do... They don't... Okay. Not in the old Soviet Union. So basically...

Jon Stoddard (27:31.615)
If you have money, you're buying something. If you don't have money, well, you know, kind of a you don't buy anything. Yeah, exactly. Interesting. think more people could do that here. Yeah. Right. Right. So so but general idea that, you know, yes, you could go and get some money from like, you know, VC and such, but it will cost you and people not always realizing how much it's going to cost them.

right? Yeah. And especially for the small business, if you're not, you know, if your revenue is not, you know, if under 10 mil, it's going to cost you a lot. Yeah. So this, this was an SAP business ecosystem kind of business. But it what did it have anything to do with your business? Or it just

It was a software development. do have a part, part of our company would do a software development. So we were familiar with the business of software development. was nothing really, I mean, it's a different niche, but it's the same business. So it's not, again, not my first choice. Software development is kind of a, honestly speaking, it sucks because you have to compete with,

sorry for that, but you have to compete with Indian developers who are knocking on your door every five seconds and telling you that, you know, we have a developers that, you know, for $5 an hour or, you know, $7 an hour. So yeah, you have to somehow, somewhere compete with that. Which, you know, turns out not to be so glamorous. And I could quote one of my, you know, customers who actually said that,

they actually, you they're using us and they're using other companies. And he said that they changed five companies in India. Wow. So kind of, yeah, it's $5 an hour, $10 an hour, but not that great. Actually, we were looking at opening an office in India at some point. And I was interviewing a few people and one of the ladies, she's a project manager and she's like,

Jon Stoddard (29:52.811)
if you will offer us a good terms, I will come to you and I will bring my entire team with me. I was like, shit, kind of a, about that. But I was like, yeah, if that's your business, so you're just picking up and leaving in the middle of the project, I really don't wanna deal with you. Yeah.

I mean, basically, then, then, then, you know, where is it guarantees that she's not going to do the same thing with you with somebody else? So, so no. So I looked at the opening up office in India. And I was like, no, I don't want to honestly, I don't want to deal with with this kind of and it's, it's, it's cultural. And I'm sure that means there are tons of companies like Microsoft, Google, they got offices in India and they're

striving, but as a small business, cannot have that big of a risk, right? So developers are moving, they're always moving, but it's not like the whole team will pick up and leave because somebody offered you a better salary. Right, right, right. So how did this, so let's, I want to go back to this. Did you...

find this guy? Was it listed on market or off market? No, no, no, it's basically he was in my ecosystem, so to speak, and we just, you know, it was another conversation we had, like, you know, and he's like, I don't know what to do next, because, you know, it looks like I'm, you know, hitting a wall with it, it's pretty much standard with a small business, right? Yeah, yeah. So you're at some point, you're feeling that you're hitting the wall because you

You don't have enough money to grow. You don't have enough resources to grow and so on and so forth. There's a chicken egg thing that happens and then you're just stagnant. Right, right, right. That's what happened. And again, now when you're a small business, your risks are higher. smaller revenue essentially, you don't know if you'll have enough kind of a project tomorrow or not. So it's all understandable.

Jon Stoddard (32:13.757)
It's, and people are getting tired of that, you know, and that's why kind of at some point it was my sort of a motivation at some point, like, well, you know, I have to go either, you know, like either sell the business or grow the business. know, so that's what I was referring to. At some point I just woke up and was like, well, you know, I'm tired of doing this. So, you know, kind of a, I either have to, you know,

sell the business or grow the business. And I was like, well, you I'm not ready to sell. I would rather grow the business. So, so that's, that's what happened. So how was that negotiation? Was that, that was cash out of pocket, fair price, overpriced, got a great deal or what? Win-win situation. Right. No, I mean, in my mind, the deal only could happen when sort of a both party will be happy at some

to some degrees unless there is a kind of outside, something going on like people will have to retire and then that's a different story or people going out of business and something like that. so no, converse, mean, we negotiated, he asked for one price, I offered him a different price.

But, you know, we sort of met in a happy middle and, you know, that was kind of a, you know, I think, he's he's actually, he is part of our company. So he- he stayed with you. yeah, he stayed with us. And now basically he is one of the directors and so like, we're, you know, pretty happy with everything. You he seems to be pretty happy with everything what happened.

Does it say, maybe it was a case of, look, I just don't want to be in the lead with all the stress behind me. That was also a part of the deal, most likely, but it's also was kind of a lot of things were happening because he was in Europe, you know, and the company was in Europe and, you know, they got some.

Jon Stoddard (34:26.999)
crazy stuff going on with the banks and with all these taxes and such. And he's like, yeah, I really don't wanna deal with this stuff anymore. I wanna kind of focus on business, but I don't wanna deal with that stuff. Right, where in Europe? The company actually was registered in Baltic Republic in Latvia. Latvia, okay. Yep, yep. yeah.

So, and again- How did that acquisition turn out as far as ROI? It was, no, it's really good. We're very happy with, we've actually gained a few more clients, you know, last year, the revenue grew and profit is, you know, actually really, really good. mean-

Again, SAP, if you are not making money on SAP development, you have to be completely clueless not to make money on SAP. It's a process to become an SAP partner, pretty much everybody who is, hey, sorry, that's my baby. We're in the office. kind of, all in the office. And that's a, you're in 2022. That's all over the place. Yeah. It's either dogs or kids or something walking in.

Yeah, now I mean, we I'm always bringing my baby to the office. So my 120 pounds baby, but you know, yeah, what kind of dog is it? It's a giant schnauzer. Giant schnauzer. Okay. Yeah. Yeah. Yeah, she's she's pretty. She has a character.

Yeah, so Latvia, huh? That's interesting. mean, was there any surprises in that? you're now you're from Eastern Europe originally. Yes. Yes. Did the language issues or do they speak English? You speak English or what? Yes. Yes. We both speak English and we both actually speak Russian. It's kind of a most like through the Eastern Europe, you you pretty much speak

Jon Stoddard (36:36.717)
A number of different languages. It's like speaking to somebody in New Mexico or Colorado. Exactly. Well, you're going to Europe in general, unless it's a friend who is not English friendly and just being, know, sometimes it's not that they don't know English, they just don't want to speak to you. But most of the European countries, they speak English. So that's not an issue. And most of the Eastern...

European countries, they speak Russian of a sort. So let me ask you about this, how you set this up, because they're completely, it's an SAP, it's different from your LMS. Was it a separate special purpose vehicle like a LLC or holding company, or is it all under the? No, no, no, no. We, again, we did the same, much the same thing. Because it's a European country, we basically acquired an asset.

because we didn't really know what's happening with the liabilities or somebody is going to sue the company like five years later. So we're trying to avoid that part, again, based on our attorney's advice. Again, if you're a bigger company, that is not so kind of a critical, but again, you're talking about the small business and if you'll, even,

even if you will win, but to go and to court in Europe and with somebody because of... The jurisdiction, I think I've had that issue. did something, it's not the most advisable thing. So that's why our attorneys, said like, do an asset purchase, basically don't touch the company.

I don't unless you have to, but because of the unknown liabilities with EU, it could be a big surprise you don't wanna see. Yeah, and where that's integrated into your stuff, if you need work done on your LMS, your other products, your commercial products, do you go to your development team and? Right, yes.

Jon Stoddard (38:57.261)
Yeah, so we do have a development teams and we're actually in that sense. Right now we got about 150 developers, or take. Yeah. It's not a huge number, but you know, just enough for a big number. Yeah. Yeah. But yeah, right now we're looking at that. As I said, we had a call this morning with a company and you know, also Eastern Europe and

They also do a software development.

We're just looking for somewhere diversification and just the capability to grow in that sense because we unfortunately, kind of fortunately, unfortunately, one of our development offices are in Russia.

And with the whole political situation right now, we're just looking for a safety net, so to speak. Yeah, it's getting a little hot in Ukraine. Yeah. And you don't really know what's going to happen. So that's why we're looking for a of a...

dual purpose, we were looking for expanding, you know, new customers and kind of a bigger revenue, but it's also kind of a little bit of a net where, you know, we could transfer some of our technologies to a safer place. Yeah, yeah. What is it now you're looking for? Are you looking to kind of keep acquiring these assets that kind of fall in your lap or you want to go bigger? No, no, well, kind of a yes, bigger. Yes, but

Jon Stoddard (40:51.597)
It's like immediate goals and long-term goals. My immediate goal is, wanna grow the business and that's not a huge company, but they got about like 4 million in revenue and pretty decent profit, but 4 million in revenue. But I just wanna have a safety net.

I don't want to hear about this Russia deal and, you the crazy people there and who knows what their president is going to do tomorrow. You know, it's like what side of the bed he's going to wake up next day and, you know, go to Ukraine. Don't go to Ukraine. I'm just tired listening to the news like, shit, you know, something is going to happen. So I want to sort of, you know, have a safety net there.

And then the next part is I wanna grow a logistic business and I wanna grow a learning management business. basically immediate goal is to have to create a safety net because I honestly, and again, grow the company, a number There's a political uncertainty happening in where your assets are. Right, I don't wanna deal with that stuff anymore, honestly.

It's not that I'm going to close the facility, I just don't, you I want to know that if something will happen, we have an alternative. Yeah. So does that include getting key people to the United States on green cards or? Well, it's that's, actually one of the reasons why I'm looking at like, for example, countries in Eastern Europe. So if something will happen, actually we could move people to kind of other Eastern European countries. Yeah.

So that's the logic behind it. So if something will happen, we could move people from Russia because getting US visa is impossible where getting Bulgarian visa, Poland visa, Czech visa is very easy. Yeah. So yeah, I'm trying to create, as I said, safety net in a kind of sort of like near shore, right?

Jon Stoddard (43:07.03)
So closer to Russia where if something will happen, I could move people to other facilities, other offices where they could keep doing what they're doing. visas again, going to US right now, there is no consulate in Russia. You cannot get a visa in Russia for the love of God, US visa.

And there is a, you know, six months line right now. So if something will happen, this probably will be like, what, 24 months line. So that's not an option. So it's like, you're trying to get people out there out of Russia, let's say, move to Bulgaria or Poland. And it's just not, the government there is just not cooperating? No, no, no, no, no, no, no. To go to Bulgaria or Poland or Czech,

that's much easier to go to the US is a huge issue. From Russia to US, it's a huge issue. So I'm happy to bring people here. And again, not to be political, I was ready at some point to send people to our southern border because it's like we're paying like 25,000 plus per working visa, plus kind of a green card and such.

And he was like, why? Why I'm doing this? Because it looks like it's much easier to go through the southern border. Yeah. Yeah. So I was like, well, you know, I'm happy to send people to Mexico. And he's like, well, know, go there. Yeah. We'll cut that recording if anything does happen. So what's the long term goal for you? I mean, do you have a number in mind that you say, I want to get this to 50 million in sell?

Private equity or what? Honestly, my goal is, know, fairly easy and fairly kind of achievable. I wanna go to about 25 million. 25 million, even or top line? Well, revenue. Revenue, okay. Revenue, yeah. So, and it's not, it's kind of a very,

Jon Stoddard (45:22.357)
very kind of in my mind, very achievable and very realistic. And then, you know, we could talk about something else, you know, because, you know, even talking to the VC companies, right? I don't talk to them, you know, from a, I wanna have a kind of a strong position for that kind of a conversation. So, and you should be in a, you know, in my mind, you should be in a better position to kind of a,

the whole revenue EBITDA and better your position is, better terms you will get. Right. Well, the larger it is, the more processes you have placed. So if you get your EBITDA over 2 million, let's say 5 million, you're going to get a, in a software company, SAP stuff, you're going to get double digits probably. Right. And that's exactly what I'm talking about. that's a conversation I would like to have.

I don't wanna go and beg for money. I was like, that's not, that's not That'll happen if you have the right structure in place. Because if a private equity firm buys you, they may have five people in their office, right? They're not gonna take over the business. Right, right, right. Have you kind of warmed up or a little bit more saying, hey, I may have to raise some money to buy something bigger to get there? Yeah, actually I'm talking to a couple companies right now.

And it's a little bit, I don't know if I will need money for the next deal, but if I will, kind of, again, private equity, for me, and again, I'm not saying that I'm an expert and you'll probably know more about it than I do, absolutely.

you know, talking to a private equity, number one, it's a long, long way to kind of to get there, right? And it's, and the second thing that actually bugs me is, you know, as I said, you're, you have to give up something, right? So, and you, the biggest part for me is you're dealing with, you know, another group of people with a different dynamic.

Jon Stoddard (47:47.029)
maybe their dynamic will match your dynamic, maybe it won't, but you're essentially, now you've got a partner and kind of a, it's like a marriage, right? It could be complicated dynamics there. It's gonna be either equity or debt. Right, so maybe you, like marriage, it's kind of a...

I've been married twice. So are you married? Yeah, no, I got I got a girlfriend and but yeah, I've been married twice. So kind of I stepped on pretty much all the things I was I was supposed to. Yeah, I think I think you can get that. I mean, we don't have a lot of time left. But if you got to say five million EBITDA.

Then you start reaching out to maybe some of the private equity groups a year in advance. Say, hey, this is what we're working on. And in 12 months, you'll get a, it's like, this is what we're looking for. This is the number. promise me that that's the number we're gonna deal with. And you'll be there. Yeah. that's what I'm trying to do. That's why I'm talking to a couple of private equity firms. And it was like, just trying to figure out what

what they're looking for. Again, it's not going to happen tomorrow, probably it's going to happen at some point. yeah, I want to have at least a few names I will feel comfortable with. Yeah. So you've done a couple acquisitions, you're working on your third, right? Right. Yeah. how does it feel a lot easier? Definitely. Definitely. You know what

know, questions to ask what, you know, where to look and such. So yeah, it's definitely. Is there a part of you that said, gosh, I wish I would have started this earlier? Absolutely. Yeah. No, it definitely, definitely. And, but again, you know, kind of a, know how to explain, you know, I guess I wasn't ready. So.

Jon Stoddard (50:00.951)
So, you know, when you're not ready, you're essentially forcing yourself when you're ready, you know, everything is much, much easier. Yeah. Yeah. When, your, your brain is open, your mind and your heart are open to that, it's, you'll find it like, like the first one you found. mean, it changed to you. Right. Exactly. It depends on what you're wishing for the universe that's working out. Absolutely. Well, Peter, we're already up against an hour and I want to thank you so much for

talking about your journey here, your acquisition journey. So, yeah, thank you so much. You're welcome. You're welcome. All right. Take care. You too. Bye.