How I Invest with David Weisburd

E348: Why “Boring” Businesses Beat Venture Capital

27 min
Apr 15, 20264 days ago
Listen to Episode
Summary

Monty Munford of GenX Capital discusses why lower middle market private equity with disciplined, repeatable processes outperforms venture capital's lottery-ticket approach. He details GenX's evolution from manufacturing to industrial services, the power of proactive sourcing and buy-build strategies, and how continuation funds enable sustained value creation without forced exits.

Insights
  • Proactive sourcing—deeply understanding fragmented industries before investing—reduces first-year friction and increases conviction, allowing GenX to close add-on acquisitions within 3 months of platform purchase
  • Boring, repeatable processes beat venture capital's power-law returns; GenX targets zero loss ratio through consistency, sector selection, and leadership partnerships rather than betting on 100x outcomes
  • Leadership (vision, culture, willingness to delegate) is distinct from management (scalable operations, finance, sales); founder-owners often have the former but need support building the latter
  • Continuation funds and co-investment vehicles solve the 'two lost years' problem (ramp-up and exit friction) by allowing reinvestment in proven assets with known teams and industries
  • AI is a sourcing and diligence accelerator, not a replacement for human judgment; GenX uses it to identify sectors, vet opportunities, and spot add-on acquisitions while maintaining disciplined investment criteria
Trends
Shift from blind-pool PE funds to hybrid models (co-invest, continuation vehicles, growth funds) reflecting LP demand for transparency and longer hold periodsLower middle market PE outperforming larger funds due to operational leverage, fragmentation, and founder-owner upside potential versus mature market saturationAI adoption in PE sourcing and diligence accelerating, but leadership and cultural fit remain human-driven decisionsFounder-family business owners increasingly seeking PE partners who understand AI and can help them avoid disruption rather than imposing wholesale management changesBuy-build strategies scaling from 5–15M to 40–60M+ EBITDA, requiring new capital structures (continuation funds, co-investors) rather than traditional fund-life constraintsDisciplined sector focus and proactive sourcing outperforming opportunistic deal sourcing in PE returnsContinuation funds gaining acceptance as LP-friendly alternative to early exits or extended fund lives, though requiring single-asset focus and proven performanceIndustrial services (high fragmentation, recurring revenue, growth dynamics) emerging as preferred lower middle market PE target versus cyclical manufacturingMentorship and broad networks becoming recognized as critical success factors in PE, reducing 'ignorance debt' and accelerating executionBoring, consistent execution and incremental improvement in processes driving superior returns versus chasing trendy sectors or asset classes
Topics
Lower Middle Market Private Equity StrategyProactive Sourcing and Sector SelectionBuy-Build and Add-On Acquisition StrategyContinuation Funds and Co-Investment VehiclesLeadership vs. Management in Portfolio CompaniesFounder-Owner Transition and ProfessionalizationAI in PE Sourcing and DiligenceIndustrial Services Sector FragmentationFund Size and Scope ManagementOrganic Growth vs. Multiple ArbitrageExit Friction and Reinvestment StrategiesPE vs. Venture Capital Return ModelsOperational Excellence and Value CreationManagement Team Assessment and DevelopmentLP Alignment and Capital Deployment
Companies
GenX Capital
Guest's firm; founded 2006, focuses on lower middle market industrial services with proactive sourcing and buy-build ...
Pagg
Portfolio company grown from 12M to 140M EBITDA via continuation fund; example of successful buy-build and organic gr...
IT Savvy
Portfolio company sold ~1 year ago; CEO helped GenX recognize early AI adoption benefits and competitive necessity
Uber
Referenced as example of venture capital's power-law return target (100x outcomes)
SpaceX
Referenced as example of venture capital's power-law return target (100x outcomes)
Anthropic
Referenced as example of venture capital's power-law return target (100x outcomes)
GE
Three of GenX's four founding partners came from GE's operating side, bringing operational excellence mindset
HIG (Hellman & Friedman)
Referenced for credit strategy; grown from 50M to 20–27B AUM over 27 years via consistent execution
People
Monty Munford
Guest; discusses GenX's lower middle market PE strategy, proactive sourcing, buy-build, and leadership development
David Weisburd
Podcast host conducting interview with Monty Munford
Ron Blalock
Co-founder of GenX Capital; came from investing side while other three founders came from GE operations
David Mass
Founder of Pagg; grew company from 12M to 62M to 140M EBITDA; exemplifies leadership qualities needed for scaling
Dr. Alexander Gross
Quoted on AI disruption: 'if you're not at the table, you're on the menu'
Charlie Munger
Quoted on manager selection: hire people who have done it multiple times rather than betting on potential
Mark Sotter
Long-time partner of Sam Zell; discussed friction of investing and selling (two lost years) and continuation vehicles
Jackson Craig
Referenced for 27 years in credit; example of consistent execution and deep sector focus driving returns
Alex Hermosy
Quoted on 'ignorant debt' concept; importance of mentorship to reduce unknown unknowns early in career
Alex Trimosi
Referenced for 'woman in the red dress' concept; importance of focus and saying no to shiny objects
Quotes
"Our goal is to have a loss ratio of zero. And the way we set up that opportunity is by being consistent in the types of investments that we make, that proactive sourcing strategy, identifying sectors that have the appropriate characteristics, partnering with the right leadership."
Monty MunfordEarly in interview
"If you're not utilizing AI, your competitor is and you're going to lose to your competitor."
IT Savvy CEO (referenced by Monty Munford)AI discussion
"Leadership is essentially the spiritual leader of the business. Management, sure, you could bring in a COO that's scaled from 140 to 500. Maybe they don't have that skill set, but you do need this leadership, which is extremely hard to find."
David WeisburdLeadership vs. management discussion
"Sometimes the hardest thing and the most boring thing is to do something continuously doing it better."
David WeisburdOn consistent execution
"Every day I get to meet an individual that founded a company. David Mass is a great example from zero took it to 12 million and even T.I. And what a great country that you are the opportunity to do that, right? And that's pretty amazing."
Monty MunfordOn what drives him in PE
Full Transcript
One of the theories they've been coming up with is asymmetry in finance specifically and private equity and venture capital. And venture capital is a little bit more pronounced, you know, about this powerlock, where if you get enough shots on goal, one of them will be the next Uber, the next SpaceX, the next Anthropic. But I also think that that happens in private equity, perhaps not with 100x returns, where if you stay in business, you do the right blocking and tackling, you get the shots on goal and you'll have one of these packs where it might go 20x. Have you found out what to be the case? I do believe in private equity and venture capital are very different. Our goal is to have a loss ratio of zero. And the way we set up that opportunity is by being consistent in the types of investments that we make, that proactive sourcing strategy, identifying sectors that have the appropriate characteristics, partnering with the right leadership. Those are critical, you know, building blocks to what we're going to execute on. And then executing on that strategy. We've now done 33 different platform investments at GenX, over 100 out on acquisitions. Our loss ratio is very low because of the consistency. Now it's evolved over time. We've gotten much better at what we do. So if you think about it, more recent funds are performing better than our more historical funds because we've just gotten better and better at it. And I think private equity enables you to do that. You enhance your strategy, you evolve your processes, and you continue to execute with a great team. Double click on proactive sourcing. What does that mean and how do you implement that on database? If you step back in time for us as an organization, we had some rough learnings early on around selecting sectors that didn't have the right characteristics. So we learned from those. This is really going back to our first fund in the Great Recession. We learned that we weren't targeting the right area. And specifically, we were in industrial manufacturing. We don't be businesses, cyclical businesses. We stayed focused on industrial services, industrial in particular, but we shifted to industrial services. Industrial services are generally larger industries, high fragmentation, attractive growth dynamics, recurring revenue streams. Those are the critical components. So in essence, that was a core part of the thesis. Okay, so those are the sectors we want to invest in. So instead of just sitting and waiting for opportunities to come to us in our through investment banks, we developed a proactive process. And that proactive process, in essence entails identifying those sub-sectors within industrial services that have those characteristics. Sometimes going and finding sector executives that have been there and done it in the space. Databasing the industry, developing intelligence, getting a broad base perspective, identified opportunities, proactively reaching out to opportunities, and then ultimately finding the right opportunity and closing on that opportunity. You go back to PAG. PAG, we identified the sector in 2015. We didn't close on the investment until 2018 because it took us that long to find the right investment opportunity in the space. That discipline is really important because it then enables us to drive the successful investments over time. Perhaps this is a dumb question, but what are second order facts? A proactive sourcing. What does that help you do and what does that help you avoid? You focus on sectors that you know have the attributes that you're looking for that increases the likelihood of success of the investment. If we do this properly, we're databaseing an industry, we're getting really smart. We're confirming that it's a fragmented industry with lots of out on acquisition opportunities. So that's important. So that bind build strategy is critical. So you fragmented an industry confirming that it is through your proactive sourcing. Oftentimes we're even identifying specific out on acquisitions that we're going to close on once we find the platform. But we find the platform on occasion we identify and proactively identified and proprietary acquired so you can even get a more attractive valuation. But even in the cases where you don't, we get really smart about the space. Oftentimes have a sector executive we partnered with that knows the space well. So we have greater conviction on the assets that we ultimately acquire. Then we're able to move quickly because we've already databaseed the industry for the out on acquisitions. Oftentimes we're closing on our first out on within the first three months of when we close on the platform acquisition. So today you have AI seemingly improving every single day, maybe every single hour. How are you using AI in order to improve your sourcing and what have been some of your latest developments? We think about AI in really two different ways, really three different ways. One, we think about AI on the investments that we make. It's critical to understand, is AI a risk for the investments that we're going to consider? Secondly, on the investments that we make, how can we utilize AI to support these businesses, whether it's on a commercial side, operational side, back office side? But from the sourcing perspective, same, same situation. We're using AI to identify and really dig into the sectors that have the characteristics that we're looking for. So we use AI to help us source the sectors of interest. We use AI to then help us diligence those sectors of interest. And then you can utilize AI to even go and identify the potential add on acquisitions. So it's pretty robust. 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The first to see wins, the rest follow. Learn more at alphasense.com slash how I invest. There's an AI researcher, Dr. Alexander Gross, and he says, in regards to AI, if you're not at the table, you're on the menu, meaning if you're not the one that's disrupting the industry, you will be disrupted. To what extent is that true in the industries that you're working with? To what extent are you looking for managers that are proactively using AI? We made an investment in a company by the name of IT Savvy to hit your point. IT Savvy had a tremendous CEO that understood the benefit of AI. We invested in IT Savvy probably three years ago, sold it about a year ago. This individual helped us to recognize that his view was, if you're not utilizing AI, your competitor is and you're going to lose your competitor. Similar mindset. He opened our eyes up to AI early on. We use it as a tool. When we invest in businesses, we invest in a lot of founder family of businesses. The reality is a lot of those executives, those family owners, family and federal businesses, don't have a full appreciation for AI. I think they're fearful of it. They are looking for a partner that can grasp it, help them to understand it and leverage it. It is a tool that we use, oftentimes we introduce it to the portfolio companies that we're working with. Taking a step back, talk to me about GenX, talk to me about the firm's history, AUM, and how the firm has evolved since inception. Take a lot of pride in the organization that I've been a part of. It's really been a tremendous experience. Firm came together in 2006. Four individuals partnered. One individual, Ron Blalock, partner, came from the investing side. Three individuals that came from the operating side. All ex-GE individuals. With the mindset of building a business focused on the lower middle market that had operational excellence, really bringing operational excellence to these lower middle market companies. That strategy has been the hallmark of the organization from day one and one of the three pillars of value creation. How we've evolved over time. I mentioned early on we invested in manufacturing and had some challenges with great recession. As we shifted to fund two, recognized we need to shift our focus. We're not going to stay in industrial but focus on services. That was the first evolution, was really focused on services. Next we introduced the proactive sourcing saying, if we're going to target a sector that we know of, let's be thoughtful around how we identify opportunities and let's develop the proactive sourcing. At the same time, we shifted our strategy in terms of value creation, bringing in with the operational excellence, bringing in a focus of growth versus just driving efficiencies on the business. Then the final point was the buy-build strategy. That's really the element that we brought in towards the end of fund two. Every transaction today now has a proactive sourcing strategy around it, a growth strategy around the operational influence, and then the growth strategy on the buy-and-build. That's consistent across all of its investments. As a result, we've gone from a firm that had some challenges with fund one to fund three. In essence, top-court, top-desk performance. You've consciously decided to keep the fund size consistent. Talk to me about the trade-off and conversations with LPs and how did that develop as a strategy? Our view was shifting our scope would not enable us to maintain that attractive return that we've been able to drive. Our LPs are very supportive of us staying within that size range. What we have done is we've in essence grown the organization. We've evolved our capabilities. Our fund sizes are getting bigger and bigger, but all within a controlled situation so that we don't shift our scope and we don't get outside of really what our core expertise is. Having hundreds of these conversations with GPs, but also LPs, it's becoming obvious that capital markets are changing from purely a blind pool fund to blind pool and co-invest and continuation vehicles and all these things. There's this interesting industry practice of taking a business, growing it three to five acts, and then selling it to your competitor and flipping it to your competitor because of these fund-lives and because some of these dynamics. Have you talked to LPs or thought about doubling down on your assets and doing things such as co-invest, continuation vehicles, or growth vehicles? You're absolutely right. 10 years ago, it was a sin to sell or to purchase a business from a private equity firm. Today it's pretty common practice. One of the things we've gotten very good at is buying built strategies. We used to be able to build businesses from five to 15 million to 20 to 30 million in EBITDA, but today we can take that same business, five to 15 million. If we're better at selecting the sector in the industry, greater fragmentation, greater scale, greater potential to really build that business and expand into different geographies, different products. We've gotten great at building businesses that are not 15 million in EBITDA, going to 20, but now we're going to 40 or 60 or in the case of Pagg, 140 million in EBITDA. That's requiring us to think a little bit differently about how we fund those transactions. We are bringing in co-investors earlier, recognizing those co-investors will support our buying build strategy. We're also doing continuation funds. We've done two continuation funds to date, single asset. All those cases were taking really good businesses with great teams and great sectors. Now we're able to support them. I'll give Pagg is one example. We grew Pagg from 12 million to 62 million in EBITDA. We did the continuation fund because it was our path to grow to 200 million. Now in the case of Pagg, we've now grown it as we did the continuation fund, we took it to 140 million. Of course, Bergen-Scott's similar situation, Whitson's another situation where we see this path to grow beyond what the fund enabled us to do because we ran out of capital in the fund. We're bringing this third party capital, so it's the continuation fund or co-investors. In that case, you're giving LPs the ability to cash out or roll into the new investors. Exactly. I think that's critical. First of all, I don't think the continuation fund strategy works if you're just fixing a broken asset or a broken fund. For us, it's really driving accelerated growth in those companies that are performing and giving the opportunity to those investors. Pagg was out of fund too. Pagg grown it to 62 million. We went out and raised the continuation fund, brought in some great partners, but we had to go to our existing investors and give them the opportunity to invest in. The ones that chose to reinvest, I think have done exceptionally well, but those that didn't reinvest, they took over four times money off the table. So it was a win-win for everybody. And secondarily, a secondary, so you get to print that DPI. So then when you go out and raise your next fund, you could show DPI. I love continuation vehicles. A lot of LPs are ambivalent about it, mostly because they don't have the team and the capacity internally to look at one-off deals. They also have this weird cognitive dissonance between having to ride along the DP that they've already underwritten. So you are the expert in the space, and now we have to decide whether we agree or disagree with you. Again, it's almost like a second underwriting. But ultimately, I do think it's a better outcome than the other outcomes, which is just selling the asset early, which is probably the worst thing. And two is these elongated DPI cycles where it was supposed to be a 10-year fund. Now it's a 12, 13, 14-year fund. Venture capital, it could be even worse. It is really interesting because I've had this debate before with people about the benefits of the continuation fund. In the end, there's a lot of different types of continuation funds and vehicles that people are doing. For us, it's very simple. It's a single asset. It's performing businesses. Opportunity to continue to support that business. And here's the benefit for us. We are now taking businesses from 60 million to 140 million. As Pag has an example, arguably it's a little bit outside of our size range, what we're used to doing. But we know the management team well. We know the industry exceptionally well. We have database industry. We know what the add-on opportunities are. We know the fragmentation. So the beta in our minds is lower because we figured out all those challenges. New investments for us are different. You know, we're getting to know the industry. We're getting to know the management team. We're still identifying the add-on opportunity. So there's lower risk our minds in the continuation vehicles that we're pursuing because these are really good businesses with great trajectory. There's inherent trade-off, which I think should be made explicit, which on one side, you're getting to deploy the Stanley drug and miller. Invest, investigate. You know this team. You know their strengths. You also know their weaknesses. It's kind of like the devil, you know, you do risk a lot of the management team. You know the industry because you've done a deep dive. You've really consciously thought about it. The downside or the trade-off is you're operating lower mill market. This is maybe middle, middle market. And do you know how to grow a 140 million EBITDA business into a 500 million dollar EBITDA business? That's what's an LPS to underwrite. For us, the greatest challenge with any one of our opportunities is leadership, getting the right leadership in place, because that leadership is going to drive the success of the business. And we're, as I mentioned, we're investing in five to 15 million dollar EBITDA businesses, founder family owned over 60%. These individuals did a great job taking the company to where it is at that point in time. And the question is whether or not they are the right team to take it to the next level, nine times out of 10, we are working with that existing team, identifying the gaps, trying to figure out where the opportunity is to really enhance leadership. So we'll add a COO. Oftentimes they don't have one. We'll add a CCO. Oftentimes they don't have one. These businesses that rarely are focused on growth the way we are. Oftentimes we're assessing the CFO to make sure it's the right CFO that can bring the right information of the team. So all that's critical and then continually over time, assessing the leadership to make sure it's the right team and they're in the right place. David Mass is a great example at PAG. Here's an individual who literally founded the business, grew to 12 million with us in partnership, grew to 62 million when we did our continuation fund and now it's 140 million dollars. You need characteristics within an individual like that, that has the leadership skill, has the willingness to not micromanage, has the recognition of putting the right infrastructure in place in terms of information to be able to make the right decisions. So those are the types of things that an individual when he starts a business has to think about if he wants to grow to that scale. You used the word leadership twice because a lot of people couple management and leadership as one person or one function. The leadership is essentially the spiritual leader of the business. Management, sure, you could bring in a COO that's scaled from 140 to 500. Maybe they don't have that skill set, but you do need this leadership, which is extremely hard to find. It's very hard to insource leadership, especially when it's not the founder. And two is the management is something that you could actually, it's a solvable problem, it's a predictable problem. How do you know somebody has scaled from 140 to 500? They've done it three other times. Right. It reminds me of the Charlie Munger quote, which is somebody was asking how they choose managers and he said, well, we find somebody that's done it a bunch of times and then we hire that person. They said, but what about somebody that's coming in that could develop in that scale? He's like, we don't do that. We are actually investing in businesses, right? Where you've got an individual that's taken the company to where it is. And we have to make an assessment over time. Is that the right person to take it to the next level? And what we've learned is one of the best ways to, you know, to help him together is to surround them with the right people. Get that COO in place. Get that CCO in place. Upgrade, you know, the finance team to the extent you need to get in the FPNA analyst, get all that right information and provide that CEO with guidance. Sometimes you'll even provide them with coaching to enable them to succeed because you're hitting on an important point, leadership, building a culture. And sometimes that founder family owner, they have built that culture awareness today and you don't want to break, you know, the culture by building the business. So that's the balance is getting, making sure you've got the right leadership that is supported by the right management. You have a really interesting vantage point in that you've done this probably dozens of times in this, this exercise of sitting with the CEO, essentially doing a SWAT analysis on them, figuring out where their strengths and their weaknesses are, double click on that. Let's say I'm the CEO of a company. It's grown. I founded it. It's now grown to 50 million EBITDA. You believe my leadership is there, but my hard skills are not there. A, how would you approach that conversation? B, what would the exercise be in order to upscale my team? There's an art involved in this. I mean, that's, I think where private equity can succeed or fail is your ability to really interact, develop a relationship with that leadership team, that individual, help them to understand the challenges of taking that business to the next level and hopefully get him to the point where he realizes we're partners. Our goal is to succeed as a partnership and for this company to win. That's really the ultimate goal. And getting them to recognize that sometimes they're stepping back is the better answer for the overall organization. And sometimes it's them stepping in in order for that business to succeed. And it is an art. There's no tool that you can specifically use that's going to enable you to do that. It's, it's an art to understand the team and your testing and retesting. Probably the most important thing as an organization, though, is to recognize that you have to continue to test it. And when in your gut, you feel that it's probably time to change. It's probably the right thing to do and not to wait. And that's one of the things we've evolved very well at is historically we believe the same leadership in place and kind of a hope and pray that they're going to get there. We don't have the patience to do that. But then it's a process of how do you. And oftentimes the team around them, it's very obvious to them when needs to change. Sometimes it's hard to face your own limitations, but everybody around you, if you, such as you're 40, 60. Yeah. Totally agree with that. Continuing on with this idea of keeping your best assets and doubling down on them. I had Sam's L's long time partner Mark Sotter, they worked together from many decades. And one of the things that he said that I think is very underrated is the friction of investing and selling the business. You essentially have two lost years. You have the year when you're getting up to speed and then you have the last year where you're basically dressing up assets to sell. And as a family office, he figured out, well, that's a lot of friction. There's obviously tax friction as well for a taxable investor. How can we roll this and avoid these two out of five years are lost years? Have you found that in that where you're, where you have a fixed timeline with an asset, you have these kinds of two, two last years? I think it's a really good point. And it, we as an organization, it took us a while to recognize the first year. And one of the things that this proactive sourcing enables us to do, and I should have mentioned it earlier, we eliminate some of the risk of the first year because we've got to know the industry so well. By the time we close on that investment, we already have an action plan as a how to drive value creation, oftentimes identifying the positions that we need to fill in the leadership role, identifying the add-on. So we try to take that first year and concentrate it into a three to six month time period with an action plan to do that. Then you're right, you've got the exit side as well and the friction associated with that in that it's absolutely friction that's impossible to avoid. Can you concentrate that as well? The continuation fund does enable you in some respects to miss that second or at least push it out to the next exit. We as investors have to return capital to our LPs. So you're balancing what's the right time to exit, what's the friction associated with that exit to minimize that as much as possible. There's several themes that smart LPs invest into. One consistent theme is lower middle market PE. Maybe you could explain why is lower middle market a smart alpha trade and also talk about the competitive environment. I've been in lower middle market all my career, so I might be biased here, but when I think about the opportunities, the levers that I can pull on to create value in the lower middle market, they're pretty significant. First of all, you're investing in a company that's this family founder of business, there's an opportunity to really optimize and professionalize the business that enables you to drive efficiencies from a cost perspective. It enables you to accelerate growth from a revenue perspective. Oftentimes the companies we invest in haven't even built out of sales organization or true go to market strategy. So there's a huge opportunity to really professionalize and drive that growth. So that's on the operational side. Coupled out with on the buying build front, lower in the market, typically greater fragmentation, smaller opportunities that you can acquire to create value. And so if you think about these different levers and we've assessed this, driving that organic growth has been our greatest attributed to value for us because of the focus on that organic growth. But when we do the buying build strategy, you're able to, with every add-on acquisition you do, be able to drive down your purchase multiple for the overall business. And on average, our add-ons are about two and a half EBITDA turns below the platform. So just to put some numbers on that, you might be buying the main asset for 8X EBITDA and then you're buying the bolt-ons for 6X and then they basically blend into 8X. So you're getting that upbringing. Exactly. And couple that then with also the synergies that you're going to get. So that eight to six times differential, you're then driving synergies that you'll get. So you accelerate your growth on that. You drive efficiencies from that. And then the third component is really what did you pay for the platform originally in terms of a multiple and what do you exit it for? So what we're seeing oftentimes is that company that we're buying for 5 to 15 million EBITDA may trade at a multiple of, call it eight to 12 times. But the premium that you're able to get when you take that business, professionalize it, professionalize the management team, expand the time that it's servicing. I expand the overall business. We're exiting at 12 to 15 times. And we can give lots of examples of doing exactly that. And the key for us is to do it on a consistent basis. And I think that's the whole evolution of organizations. You get better and better at your processes to increase the likelihood of that consistent outcome. Most smart investors understand that size is the enemy of returns. And basically every asset class, there's almost, there's very few asset classes that actually have economies of scale and investment management. Have you resisted the urge to get bigger? The way we're able to put more capital to work is I think by increasing the success of the buying build strategy. So once again, where we take a company from 5 to 15 million to 20 to 30 million EBITDA, we're now taking the 40 to 60 million EBITDA. So we're able to actually get bigger and put more capital to work without really changing our strategy. We're still focused on the low-emittable market. We're still focused on the buying build, professionalizing and optimizing. That's how we've been able to do it. So our fund sizes are getting bigger, but our scope hasn't changed. Private equity is evolving at a blistering space, almost as fast as AI. Where do you think Gen X will be in 2030 and what's going to fundamentally change? We as an organization are going to continue to grow. We're going to continue to identify new sectors for investment focused on that same proactive buying build strategy. I could envision us potentially acquiring or providing different capital solutions. Maybe we step into some different types of credit alternatives to provide to our investors. I think those are all areas of uncertainty and frankness. Right now, our focus is to just keep doing what we do now, is to do it better and better. Sometimes the hardest thing and the most boring thing is to do something continuously doing it better. I had a Jackson Craig from HIG and he's been doing credit for 27 years. I think they've grown from 50 to a million to I think 20, 25 or 27 billion. Somebody could fact check me, but it's so incredibly difficult to do the same thing over and over and just get better every day. And it's so unremarkable that at the same time, so impressive to do it. And this is something that I've changed my mind on recently is just being amazed by people that are able to go deeper and deeper in one sector for many years and for many decades. It's something that is so difficult because what they're also doing is saying no to so many other shining objects. Alex Trimosi has been on a podcast twice, calls it the woman in the red dress. It's if you could just put on blinders and focus on anything you could get good at anything, a sudden other way, it's the grass is always greener. Oh, let's do this. It doesn't have all these problems. You obviously you're not in the business, so you don't know all the problems, but every industry has problems, but just continue to be amazed by these people are able to continually innovate and go deeper in the sector. You say that, but at the same time, every day for me is a different day with different challenges. I am doing the same strategy, implementing the same strategies and organization. We're doing the same thing, but every day I'm meeting a different management team in a different industry, learning about how that company competes in that industry. So for me, I love what I do. I and it isn't difficult because there's just so much learning that we're doing on a consistent basis, implementing the same model, but in different sub sectors on a consistent basis. And that does require discipline as a willingness to learn a new industry and understand how company competes in that and how a leadership team competes in that. No offense, but lower mill market doesn't sound very sexy. And I always wonder what gets people up and what makes them excited. And I have a theory that different private equity professionals filter through different things. Some people like the deal, some people like the people, some people like the investments, some people just like the lifestyle. What are the different ways that private equity professionals in your opinion filter these opportunities? I love what I do is because pretty much every day I get to meet an individual that founded a company. David Mass is a great example from zero took it to 12 million and even T.I. And what a great country that you are the opportunity to do that, right? And that's pretty amazing. I then get to figure out whether or not that's the right opportunity for us and whether or not that's the right leader for us. So to me, every single day is the same now. What do I like to do? Within that, I am the leadership meeting with the leadership, working with the leadership, figuring out the capital structure, the right capital structure, negotiating about the business, diligence in the business. There's all these different functional areas that are required that make it fun. So every day is a different day for me, but it's challenged because you've got to consistently do them all well. And you got to remember who you're, who you're ultimately speaking to. And that's your investor. And you've got the fiduciary duty to them to continue to execute. Exceptional well. And then it's really around building the team around you. We built a great organization, a lot of great people. And that team is what's going to ultimately enable us to continue to do what we do well. If you could go back to when you just graduated at UCLA, and you could give younger Monty one piece of timeless wisdom. What would that timeless wisdom be? I do like to speak with younger people all the time to try to give them advice. If I step back, I didn't build as broad a mentorship as I wish I had that probably would help me along the way to maybe avoid some of the challenges that I had and give me the sounding board that would have helped me to maybe accelerate faster. Couldn't be happy with where I am today. But I envisioned the road could have been a little less bumpy if I had the right leadership and support along the way. Alex Hermosy calls this ignorant debt. We all start our career with ignorance debt. We just don't know about it. It's like, it's the unknown unknowns. And how do you pay down that ignorance debt? You go to people that have gone that path for 10, 20 years. And that doesn't mean you have to replicate what they did, but you take a little bit from everybody and then you get kind of, you start to pressure test your thesis. I think about this advice of being around the best people. And in some ways it sounds straight. It's like who wouldn't want to be around the best people, but there is a tradeoff there, which it might not be the sexiest industry. It might not be the sexiest product at the time. You know, different asset classes go through different cycles, but if you filter through the people and avoid the sexiness or the timeliness or the products, I think you're going to be much better off than if you do the opposite, which is you look at where the industry is going now and where the sexiest opportunities, but you may not be inspired by the people that people might not be willing to mentor you. And I'd develop you. That's a good point. I, what I do is into sexiest and lower middle market, industrial services. But to me, it's extremely fulfilling. The opportunities that I'm able to partner with an executive, build his business, help him create wealth, help him create wealth for his team and do the same thing for our organization is huge. And having a mentor there probably would be a wonderful thing to have or the right mentorships to enable me to continue to do that more effectively. Monti, this has been absolute masterclass. Thanks so much for stopping by and looking forward to doing this again soon. Love that. I really appreciate the opportunity. Thank you so much. If you found this conversation valuable, please click follow how I invest so that you don't miss the next episode with the world's top investors.