The Private Equity Podcast, by Raw Selection

Welcome back to The Private Equity Podcast, by Raw Selection! In this episode, Alex is joined by Andrew Towne, a partner at Olympus Pines and a five-time world record holder. Andrew shares his journey from private equity to breaking world records, including his impressive mountain climbing feats and insights into the private equity industry. Join us as we dive into the mindset and strategies of this remarkable private equity leader.Breakdown:[00:00] Andrew shares his experience climbing Aconcagua during a deadly season.[00:19] Introduction to Andrew’s investment focus in the American car wash industry and his world records.[01:53] Andrew discusses his career journey, starting in international relations and transitioning to private equity.[02:18] The common mistake private equity firms make: neglecting operations and transformation.[02:45] Why portfolio operations are essential for unlocking value in competitive deals.[03:14] Examples of operational improvements in revenue and cost management within portfolio companies.[05:06] Andrew’s consulting background at Boston Consulting Group and his shift into private equity.[06:07] How living abroad in countries like Germany and Kenya shaped Andrew’s worldview.[07:34] Moving from consulting to private equity: Andrew wanted to own decisions and manage risk.[09:31] Lessons from world travel: people are more similar than different across cultures.[12:36] A customer’s comment at a car wash illustrates how people view different roles in society.[15:05] Why Andrew and his team chose to invest in the evolving American car wash industry.[16:26] Technological innovations and automation driving growth in the car wash business.[17:49] How Andrew’s car washes use advanced technology to ensure customer satisfaction.[18:48] Balancing customer service with profitability in the car wash sector.[20:15] The fragmented nature of the car wash industry creates growth opportunities.[21:44] Challenges in building new car washes and scaling operations.[22:25] Andrew’s journey from overcoming childhood obesity to breaking world records.[24:47] How rowing at Yale taught Andrew to push through mental barriers and trust himself.[26:09] After completing the Seven Summits, Andrew turned to ocean rowing and set world records.[28:04] Stories from his expeditions, including surviving a deadly earthquake at Everest base camp.[29:02] The story behind Andrew’s world-record row from South America to Antarctica.[31:28] Andrew’s approach to confronting fears and mental challenges in everyday life.[35:21] Closing remarks from Alex and Andrew summarizing their discussion on private equity, personal growth, and world records. You can connect with Andrew Towne on LinkedIn by visiting his profile here. To be added to the book waitlist, you can email [email protected] you for tuning in!To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to [email protected]

Welcome back to The Private Equity Podcast by Raw Selection! In this episode, Alex is joined by Beth Pollack, an applied AI and data strategy operating partner with over two decades of experience in building decision systems. Beth works closely with private equity firms and their portfolio companies to drive value through AI and data initiatives. She shares insights on how AI can be effectively implemented in private equity-backed companies, avoiding common mistakes and maximizing opportunities for growth. Breakdown: [00:00] Introduction to Beth Pollack, AI and data expert, discussing AI's role in private equity-backed companies.[00:31] Beth shares her background, with over 20 years of experience in AI and data strategy.[00:59] Beth highlights common mistakes in AI implementation, like starting without clear problem definition and not integrating workflows.[01:50] The importance of aligning AI projects with business goals and involving the right people early is emphasized.[02:49] Beth advises against using large consulting firms without AI expertise.[03:19] She explains the need for selecting the right AI tools beyond ChatGPT.[03:46] Breaking down problems into smaller components helps with AI efficiency.[04:16] Beth shares her journey from data mining to building AI systems.[05:09] A case study shows how AI increased EBITDA in a healthcare company.[06:07] In the healthcare project, AI and machine learning were used to process medical records and improve clinical decision-making.[07:33] AI helped the company enter new markets and improve patient outcomes by identifying conditions that human review may have missed.[07:57] Successful AI implementation begins by identifying workflows, engaging teams, and understanding investment needs.[08:53] Gaining leadership and team trust is crucial for effective AI strategies.[09:50] AI projects should align with broader business goals and focus on problem-solving.[10:46] Speed to value can be achieved by using existing tools and internal resources.[11:42] AI is advancing rapidly, becoming more accessible and cost-effective for businesses.[13:07] Beth discusses how the acceleration of AI innovation is impacting private equity firms.[14:06] Large language models (LLMs) and open-source technology are helping optimize AI for businesses.[15:23] Private equity firms should involve AI experts during the diligence process to assess investments and create value.[16:50] AI can transform not only new investments but also portfolio companies nearing exit.[17:11] Beth recommends staying updated by talking to practitioners and following AI publications and podcasts.[17:41] She shares her favorite podcasts, including Lex Friedman's and "AI on AI."[18:37] You can reach Beth Pollack on LinkedIn for further discussions on AI and data strategy.[19:07] Closing remarks from Alex. You can connect with Beth Pollack on LinkedIn by visiting her profile here. To be added to the book waitlist, you can email [email protected] you for tuning in!To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to [email protected]

In this episode of the Private Equity Podcast, host Alex Rawlings is joined by Paul Adams, an experienced CEO in the home and residential services sector. Paul shares his extensive experience in leading private equity-backed companies through multiple acquisitions and the challenges of navigating a highly fragmented industry. They dive into why private equity is increasingly focused on the residential services sector, what makes it such an attractive investment opportunity, and the importance of managing labor shortages in a people-driven business. [00:00] Introduction of Paul Adams.[00:44] Paul’s background in HVAC, electrical, and plumbing services.[01:38] Challenges private equity faces with mom-and-pop shops in home services.[02:08] Importance of patience and strong M&A skills in home services.[02:36] Balancing private equity's need for speed with the slower pace of acquisitions.[03:33] The emotional side of selling a family legacy and employee concerns.[03:59] How generational handovers can create trust issues during acquisitions.[04:28] Building trust and relationships with founders during the process.[04:57] Paul’s approach to working with contractors in residential services.[05:26] The people-driven nature of service businesses and their focus on relationships.[05:53] Addressing concerns of sellers about their employees and legacy post-sale.[06:52] Challenges in attracting technicians despite the sector's essential nature.[07:19] Impact of the labor shortage on growth in home services.[08:19] Acquiring companies to meet demand and gain market share.[09:18] Changes in the sector, including energy efficiency and government rebates.[09:48] How government regulations are driving growth in system replacements.[10:17] Increasing profitability through system replacements and upgrades.[10:47] Private equity's interest in home services due to favorable cash flow.[11:15] Low capital requirements and barriers to entry in home services.[11:41] Challenges for small companies to scale due to limited technicians.[12:09] Struggles of small businesses in growth because of labor shortages.[12:35] Fragmentation and integration challenges in residential services.[13:05] Costs of elevating unsophisticated businesses post-acquisition.[14:04] Importance of proper systems to meet customer expectations.[14:33] Paul’s strategy in buy-and-build and lessons learned from past experiences.[14:57] Avoiding big announcements and press releases post-acquisition.[15:29] Focusing on investment and continuity to maintain business stability.[16:19] Benefits of working in the background for better performance.[17:17] The power of consistency in building successful businesses.[19:43] Paul’s passion for the residential services industry and M&A challenges.[20:12] Alex’s closing remarks and a reminder to subscribe to the podcast.You can connect with Paul Adams on LinkedIn by visiting his profile here. To be added to the book waitlist, you can email [email protected] you for tuning in!To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to [email protected].

Welcome back to The Private Equity Podcast, by Raw Selection! In this episode, Alex Rawlings is joined by Richard Brekka, Managing Partner and Co-Founder of Second Alpha. Richard dives deep into the explosive growth of the secondaries market, explaining how his firm provides liquidity to shareholders of private tech companies. The pair discuss the rise of secondary funds, why more companies are staying private longer, and the unique opportunities in the market for smaller, profitable tech companies.  Breakdown: [00:00] Introduction to Richard Brekka, Managing Partner and Co-Founder of Second Alpha.[00:12] Richard explains the secondary market's growth and why 90% of it is in unicorn companies.[01:10] Richard’s background and how he got into secondary investing after working in venture capital.[01:37] The common mistake of holding on to investments too long and the importance of realizing value sooner.[02:05] Richard explains the two types of secondary markets: fund secondaries and direct secondaries.[02:58] Growth in secondary funds driven by a lack of liquidity for GPs and the emergence of unicorn companies staying private longer.[03:58] Richard shares why 90% of transactions in the secondary market are focused on unicorn companies.[05:25] Discussion on the $2.3 trillion unicorn market and the trillion-dollar opportunity in companies valued between $100 million and $1 billion.[06:21] How Second Alpha identifies companies for investment by targeting profitable, growing companies over $100 million in revenue.[07:50] Second Alpha’s approach to providing liquidity to shareholders and building long-term relationships with CEOs.[08:49] Richard discusses the various reasons shareholders seek liquidity, from personal financial needs to new business investments.[10:12] The value Second Alpha provides to CEOs and how they become a trusted partner in helping companies toward their exit.[11:00] Richard explains the challenges of accessing private companies for investment and how Second Alpha overcomes these obstacles.[11:58] The importance of building trust with CEOs and navigating rights of first refusal in secondary deals.[13:26] Second Alpha’s role as a helpful partner to the CEOs, offering introductions, advice, and exit planning support.[14:53] Challenges private companies face after 10 years of growth, including management changes and adapting to market shifts.[16:22] How companies must pivot and develop new products to continue growing and reach their next phase of success.[17:20] Second Alpha’s focus on North American technology companies with strong revenue and profitability.[18:46] The advantage of investing in growth-stage companies at a discount through secondary transactions.[20:39] The role of artificial intelligence and cloud technologies in transforming industries and the efficiency opportunities they bring.[22:32] Second Alpha’s focus on disrupting industries like data analytics and finding efficiencies in cloud infrastructure.You can connect with Richard Brekka on LinkedIn by visiting his profile here. To be added to the book waitlist, you can email [email protected] you for tuning in!To get the newest Private Equity episodes, you can subscribe on iTunes or Spotify here.Lastly, if you have any feedback on the podcast or want to reach out to Alex with any questions, send an email to [email protected]