The $10M “AI Anti-Aging Bed” That Might Be Too Weird to Be Real

0:00Welcome to Acquisitions Anonymous. Today's video was myself and Travis going through a deal that I brought from Orlando. that involves a smart mattress, AI, and a price that changed by 30 % in three paragraphs of reading the teaser. So Travis and I had a great conversation. He's a super smart, well-spoken guy who knows a lot of stuff. So it was super fun to dig into it. Enjoy the episode and stick around to the end. You'll see how we felt about the deal. We'll set Acquisitions Anonymous. Hello, another episode of Acquisitions Anonymous. We don't have 100 % beers anymore. And thumbs downing on just the plus inventory.

0:36This episode of Acquisitions Anonymous is brought to you by Quiet Light Brokerage. And I'm sitting here to tell you I have both sold businesses with Quiet Light and bought businesses from Quiet Light. And in my opinion, they are extremely high quality people, very, very rigorous, and they're really straight shooters. One of the things that differentiates Quiet Light is every single broker at Quiet Light has been an operator. They have been an operator of an active business and they have sold it. Many of them have also bought businesses. So they really understand what it means to be in the seller's seat and how important that is to you.

1:11And they also really understand what it means to be in the buyer's seat. So they don't BS you, but they really do know how buyers think. All of the transactions I did with Quiet Light, in fact, one of them, they took over a sale process that another broker had not been able to get done. And they got it done for me inside of 90 days. So I've had very positive personal experiences with Quiet Light. And I do recommend them wholeheartedly to a lot of people. and now they're a sponsor of the podcast. So one thing you can get for free is if you head over to quietlight.com, they will do a valuation clarity call with you, which is not a sales call.

1:44They're not pushy people. They'll just kind of tell you, hey, here's what your business is probably worth and here are a few things you could do to make it worth more. And hey, maybe don't sell it right now. Do these things. Come back to us in six months and you'll get a much better multiple. So if you're thinking about selling your business or you're thinking about buying a business, especially in the e-commerce space where they're very, very strong and been doing this for over a decade. Go check out Quiet Light Brobridge over at quietlight.com. I can't wait to hear what this is. So, all right, Travis, good to see you.

2:15Okay, so I took the family to Japan for spring break. It was just like magical thing. My kids are 17 and 20. So this is kind of the twilight of kid time and you have young kids. So imagine how special things are now, but when it starts to end, it's like graduating high school, college, and like your first girlfriend breaking up like all in one. That's like the emotional thing if your kid's starting to age out. So we took him to Japan. We're flying over there. And I'm thinking about business. I'm kind of stressed out. And I'm chewing on my nail. And I chip my tooth. And you know that annoying chipped tooth to where your tongue touches it the entire time.

2:51And I started to do the Japanese young lady thing, which was when I was talking, I would cover my mouth because I was embarrassed to my smile. So I call the dentist and I'm going to go through this for 10 days in Japan, embarrassed about my smile. And I call the dentist like the day I get home. I'm like, can I get back in? And they're like, yes, in a week. So two days before I'm supposed to go back in, I'm sitting there thinking about business. I've got my thumb in my mouth, on my nail, I chip another tooth all at once. So there I am. I'm looking like a vampire. I got two chipped teeth. I'm talking like a young Harajuku Japanese lady, young lady, covering my mouth with my hand the whole time.

3:32So I go in to name the dentist because my wife was like, are you excited for today? I was like, I'm so excited because I've been so frustrated by these chipped teeth. So I go to the dentist and the dentist was like, so what happened? She's like, did you bite it on a fork? I was like, no, I was chewing on my nail. She's like, well, what happened to the other tooth? I was like, also chewing on the nail. She's like, how old are you? I was like, 52. I'm an idiot. So anyway, it's been the best day ever because he's like i got you covered and she fixed it and now i'm proud of my smile again because as a 51 year old male that's how i actually old i am the only thing that people ever compliment me on on my appearance is my teeth that's the thing i gotta keep going because nobody says anything else so true story my dad chews to his nails for 70 years and then he also chipped his tooth really bad but it was something about how it happened meant he had to spend like, I don't know, 15, 16,$17 ,000 fixing it.

4:25And so he immediately stopped chewing his nails right there. Yeah. I told, I told the dentist, I was like, if you fix this, I'm never screwing up again. I'll be good. I promise. God, please. Okay. So I got a crazy deal for you since we're done talking about me. I hope you're doing well. I'm going to do good, buddy. Thank you. my teeth are fine okay so I ran across this because it is one of the weirdest deals I've ever seen so it is an amazing anti-aging bed that is AI driven and the header is also may qualify for an E2 visa so it's located in Orange County it's listed by Alan Mayrez who looks pretty respectable he's got a pocket square in and yeah it's exactly what you expect so there's a picture of kind of a floating how would you describe this like aladdin and one of the mail-in mattress companies had a baby it's like a floating you're floating magic magic it looks like a porn set to be honest oh i wouldn't know all right in theory so i've heard uh actually i I did record for my channel a video about the rise and fall of OnlyFans.

5:45And I recorded it all before the owner just died. But in doing it, usually when I record one of these videos for YouTube, I go do first-person research. I go to Quiznos. I go to Starbucks. I go try it if I can't Topgolf. And here I had to turn to the camera and be like, I did no first-person research on this, guys. Just so you know, never opened up OnlyFans, have no plans. So anyway, good times. All right. Right, so the Magic Porno Bed company has a$10 million asking price. It makes$1.1 million in EBITDA on$3.2 million in gross revenue, established in 1995. The first line. This business may be bought with an SBA loan with only 10 % down.

6:30This established medical technology manufacturing and retail enterprise specializes in AI-enabled therapeutic beds and related accessories, serving the medical spa industry through established distribution channels. The company operates as both a manufacturer and retailer, managing proprietary technology protected by two granted patents. Gross revenue is over$3 million. The owner makes$1.1 million a year and strong profit margins. They have proprietary AI-driven medical bed technology with patent protection. And then I think a bunch of the other stuff that they just said here again. There's a 50 % partnership opportunity if you only want to buy in for half of it at$3.5 million, or you could buy the whole thing for$7 million, which is confusing to me because up here it says the asking price is$10 million.

7:15So how do you read that, Travis? Did they just lower the price in two paragraphs? I'm not convinced anyone knows what they're doing yet. Okay.

7:27SBA financing may be available for qualified buyers, potentially requiring a 5 % to 10 % down payment. The business may also qualify for E2 visa consideration for eligible international investors. Are you familiar with this visa type? Not really. I think we've all heard whisperings of it. It is supposedly the foreign investor visa. So E2 visa. So like if you see like a lot of these, at least here in San Antonio, we get them all the time. These weird kind of real estate projects where it's like, who's going to buy this? Like it's a condo and stuff like that. it's because people that um are from u.s or here's describing the e2 visa allows nationals from treaty countries to live and work in the u.s by making a substantial investment in legitimate u.s businesses where they own at least 50 or have operation control the investment must be a risk and the business cannot be marginal it is a non-immigrant renewable visa so you have to invest over a hundred thousand dollars but there's no minimum and you could potentially do less and the business must be active legal and generate more income than just providing for the investor and you must come to the U.S.

8:29to direct and develop the enterprise. Initial admission is up to five years or two-year extensions available indefinitely as long as the business thrives. So yeah, I think he's indicating this is a way if you're a Chinese or whomever, I think the Chinese can still do it, Mexican, that sort of thing, you can use this visa. I can buy this magic carpet bed. In theory, it sounds like a good visa. Let's get people motivated to build things, to come here and do things. uh yeah i'm as a citizen i'm pro this visa like yeah if you say that's a good thing let's get more smart people in here building stuff okay um so they have due diligence requirements uh you do have to provide proof of funds documentation or the lender free qualification letter and uh it is a growing entry into the medical wellness sector with established revenue streams and stuff like that they have seven employees they operate in a commercial complex with a large showroom and a a big warehouse of about 8 ,000 feet.

9:25While there are other businesses in this space, none are as unique as this one. And the reason for selling is the seller has to pay off some debt. And it's located in Orlando, Florida.

9:38So what's your thought on what they do here? I still don't know what they do. Are they selling, are they a distributor? Are they selling this to wellness centers? Or is this, it has to be the business. Am I missing it? It says here, the company operates both as a manufacturer and retailer, maintaining proprietary technology protected by two granted patents. I wish I would give some details on what this AI bed does. Does it track your sleep? Does it change your position? Does it change the firmness? It's definitely possible. Well, this reminds me, I went to go visit a guy once who is probably, well, I'm, you know, he was in his late 60s at the time, but he was one of those people that just bought hook, line and sinker every just kind of hokey, like scammy, like medical technology.

10:32and it was just like I went to his office once and he had he was a very wealthy guy and went to his office once and he had like 5 ,000 square feet of all of these like weird aura beds and like electro stimulation stuff and like compression type things. It was basically like the$10 ,000 to$25 ,000 version of machines that are like the what's that band that you put on? Like the one that's like a copper band? the copper band yeah yeah yeah like imagine that but it's from billionaires like that was what it is and all the machines look like they were straight out of buck rogers that's the thing about the megan beds no oh wow this this was cool um this is before i was an entrepreneur it was they would open these centers uh and they would have i don't know like 20 beds in them and these beds would have, you would lay on it and kind of a massager would go up and down.

11:29And it was full of the infrared, like red light bulbs. And so you would lay on it and it would like be zapping your body while this massager goes up and down. And their business model was kind of unique. You could come into the center as once a day for free, as long as you would want. And, but they would get people because they wanted to do it at home instead of coming in the center. And they would charge amount of$20 ,000 for this bed or something like that. I think they did well for a while. It's kind of a wild business model. Yeah, it has to be because you're selling a$1 ,000 bed, basically, for$25 ,000.

12:04Like, it's got to be a good business. I mean, from a profitability standpoint. Yeah, yeah, yeah. And I think it was franchised out anyway. But also, I don't think that place is there anymore. So maybe it wasn't a great business, but good in theory. Yeah. This feels like this is part of that same vein of stuff, which is scammy pseudo health you know we're not going to make any claims but like if you're the type of person that reads obscure websites about your health and wants to take like weird peptides like this is for you yeah yeah 100 there's a so much money in this industry too it's absolutely bongers it's like people get called up in like the conspiracy theory industry or like the some like the crazy alt investing stuff you ever get on an alt investing newsletter my god those people are nuts um like every single day like the u.s is collapsing tomorrow tomorrow and then the next day well it didn't happen because of this one reason but the next day it's going to collapse i promise you buy gold now uh it reminds me that reminds me of robert kiyosaki the rich dad poor dad guy that dude that dude who's predicted 130 the last zero recessions like writes one amazing book and then just goes bonkers for the next 30 years oh you know he didn't even write it oh really he had a ghost written for him that explains a lot then that explains a lot more oh wow yeah that dude's off his rocker is there any way this this product actually works if we knew what it did i mean i could i mean i can right now think of several ways like ai um bed would be kind of useful i mean i have the eight sleep like mattress topper amazing like if you hear all the ads like those are you know usually sponsored i'm not sponsored that thing's amazing get that um but like we're yeah we're chili pad family and and i'm a whoop guy and it has taken my whoop scores up to 100 consistently yeah game game changer um and the eight sleep has a lot of like the tracking in it now and i can see like the little changes that i make and so my sleep score gets better because the things that I learned from that.

14:11But you could do that with the Oura Ring. It doesn't have to be a mattress. So I could totally see this being a thing. I could totally see, and I think the latest eight sleep, if you start snoring, it will slowly raise you up, your head up, the entire bed. And so like to change your angle, so you stop snoring as much. I don't have that model. But so you could see all these things where you're putting AI in quotes, like you don't need AI. It's just, you know, you got to say AI now because it adds a couple turns to the valuation by just putting AI in the name right now. So there are things this bed could do.

14:42So it could actually be useful. I mean, if I paid a lot for a ChiliPad, you know, we have a California King because I'm six foot five. So we bought two size. So I paid$3 ,000, which is a lot, a lot of money for a bed topper. But I would pay it again in a heartbeat. Like it is that worth it. So in theory, this could be actually, there could be some useful aspect of this one of the things would be if you are in that space i mean talk about a competitive industry right now to gain any eyeballs like you know the smart mattress thing the eight sleeps the chili pad is basically reigning number two right now eight sleep i would hate to compete with them but then just the mattress industry in general i cannot think of too many more competitive industries other than like credit cards out there yeah Yeah, that is, it is, it is a cutthroat.

15:36Yeah. I mean, imagine competing with Ramp or Brex and those guys in the budgets they have. Like, like the amount of money. I am so thankful for VCs, by the way, as somebody who owns like a media business that takes ads. Because every week they're like, we would like to spend a lot of money with you. I'm like, fine, we'll take it. Like, you want me to, you want to pay me how much to read an ad for 60 seconds? I'm your guy. And then I'll go walk in the drainage ditch and talk about some business I want to learn out about. have you ever done an episode on the mattress phenomenon we witnessed a few years ago no like rise and fall of mattress please do that i would watch that in a heartbeat i would love to see that it was so fascinating i think like the gross margins on a lot of these were negative every unit they sold for a while really gross not even net yes are you talking about the smart mattresses are you talking about like mattress for all of them the purples the what helix all all of those the DVC ones yeah it got nutty for a while so yeah make one of those I'd love to watch that humorously this morning because my teeth were chipped I did a Smile Direct Club because my teeth I was like I'm recording this thing because my teeth are all messed up last night I spent the night writing a script for that because my teeth felt terrible I was like oh good but it was the same thing like they were spending Smile Direct Club was spending over 50 % of revenue on marketing on CAC So they were doing three quarters of a billion dollars a year for those little teeth straightening kits, but they were losing money.

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17:34They're passionate about helping entrepreneurs like you take the next big step. So don't wait to make your business ownership dream a reality. Visit acquisitionlab.com today to learn more and schedule your free consultation. And when you do, be sure to tell them the Acquisitions Anonymous podcast sent you. Because they're aiming for an exit. And when you have a model like that, the moment you slow down, your valuation's gone. You have to keep pushing forward. You got to keep accelerating even if you're playing that venture game. If you lose that, I mean, like you and I, we're happy to play non-venture games, right?

18:07Like, oh, it's increasing 5 % a year. Awesome. Sweet. Good valuation we got in. This is a great deal. No, those things, if you're not like, you know, 10%, 20 % month over month, like you're nothing. So you just got to keep adding money no matter what it's doing. Have you seen where people are starting to do smart mattresses, but for toilets and poop analysis. Have you seen some of this? No.

18:30So two thoughts about this. One is we went to Japan for spring break and you go to a public toilet and it's like one of those fancy, you know, like the Toto toilets with like the buttons that bidets you and all that kind of stuff. Totally amazing. Like you'll go to a train station and there's one of those and it's pristine because the Japanese have this like whole community centric way of looking at the world. If you soiled something and disrespected the toilet at the trade station, that's a you problem. So it was super amazing. And we came back and first thing we were doing was install a bidet at the house because everybody was like, we're going to have crystal clean backsides.

19:09So anyway. Totos all the way, for sure. We got them. Why would you not? They're totally worth it. um so interestingly enough a friend of mine his he knows a guy who's on american on the board of toto and the guy when he joined the board basically went in he's supposed to represent kind of the western consumer and he uh went in and said hey like you need to like do more diagnostics and like give people like gut health and all this kind of stuff from usage of the toilet and so they can kind of use that as a way to make themselves healthier and the japanese who were in charge of the company responded that they didn't want to do that because they already knew so much about people from how they pooped and when they pooped and all that kind of stuff that it would freak people out because those toilets were so smart.

19:58Oh, they're logging data? Really? Yeah. Why? So I was like, well, if you guys really want to know about that, it's fine. Like I have a lot of fiber.

20:13All right. So back to this deal. I mean, I wanted to kind of bring this forward because this pattern matches to me as something that just like this is the type of thing that when you're first starting out, you're like, well, there could be something here. But is there any way this thing is just not totally scammy? Like, is there any path for that you see this? So I totally see it being a legitimate business. I think it's the positioning and evaluation being thrown around with it that makes it totally scammy. I don't know, just make an interesting mattress that like gathers data or does something.

20:44That's fine. That's cool. But the whole positioning just takes it. And I don't necessarily blame them. Like, I don't love it. But like, I don't know, take a flyer. See if anyone wants to do this. Right. Like, maybe some rich person from the Middle East. Like, yeah, sure. I'd like a visa in the US. Let's just buy this. And it's AI. AI sounds cool. Like, I don't know. You're super rich. Like, yeah, I got an AI company. I don't know. Take a flyer. so uh well they can't blame them they only got to make a market of one I guess yeah uh cool all right well um yeah I think it's just a fascinating one I love how they changed the asking price from the top of the listing to the bottom like they went down 30 % in three paragraphs so all right so where do where do you stand on this one anything else we should talk about no are you guys gonna have this one on capital pad yeah i can't can't wait can't wait for this one on capital pad like just uh salivated thinking about it uh what's the coolest deal you guys have done lately i'll have one i just finished the editing on it right now actually so it's uh hvac which is interesting because h like residential hvac right and so that basically means you can't do it because it's too expensive now.

22:06We had to leave the country. We went to Canada. So we're doing a Canadian deal. And that's the only way to get it priced correctly. Because Canada is always, you know, as they say, five to seven years behind the U.S. in this turn. So yeah, really stoked. Residential HVAC company. It's looking really solid. Is there debt available up there for that? Or are you guys having a well-priced debt? But if the sponsor behind it is talented and basically has a track record, then yeah, they can get debt. It's like 6%. Okay. But it's like a Canadian, there's a Canadian bank or something like that. Yeah, Canadian banks.

22:41It's not, there's nothing like a searcher program. These are definitely like independent sponsor style deals, more traditional financing. But yeah, they get it. And the rates are better than the US even. So it's kind of attractive. There you go. Well, so how does the process work? So next you guys, you prepare everything, you put it in front of the membership, and then there's basically probably a management call where they come in and people have a chance to opt in or opt out. That's kind of the flow. Yeah, so we'll make the listing live on the site today. Tomorrow morning, the email will go out to all of the accredited users on the platform.

23:16And it's kind of like a teaser. They go to the site and they can check it out, see if they're interested. They can sign the NDA on platform and then go deeper if they are. and then later in the week we'll have an open sponsor call. So Q &A, the sponsor, can ask any questions they want. Anybody can join the call who signed the NDA and we just go from there and we start opening up allocations. Nice. Yeah, pretty simple. It's a whole point. Well, hopefully when I am less cash strapped, I will be in there writing some checks because I know Bill's having fun with it so I want to do it too. Really good time.

23:48Thanks, Bill. Oh, he's still, well, he's told me he's active You don't need to say that. Okay, so back to this deal. Sounds like you're a, man, I wish this wasn't$10 million type position on it. Or how are you thinking? I mean, when I see AI, I almost just, it's immediate write-off. Like if something in my inbox says AI on it, I'm like, nah, I don't need to open that. But yeah, I don't know. If they had said like health-focused bed or something like that, I'd be more interested. There's something to be said about smart beds. I mean, people are buying them. I ended up buying them because one of my friends was like, you've got to do this.

24:27And I was like, okay, I'll do it. And I did it and I don't regret it. What if the deal was from Allen Iverson buying a Canadian HVAC company?

24:40Allen Iverson? I would be more interested. Yes, I would be very much more interested. An AI HVAC company. So did you follow the SPAC era closely? Not closely, you know, from a distance of amusement. That's about it. One of the things, so, you know, SPACs would raise these kind of blind pools that would then go find companies to take them public. And one of the things they would do is they would go get a big suite of partners. But every single, like, every single one would go and it'd be a couple guys that were, you know, just very wealthy fund managers or whatever, private equity partners, VC partners.

25:15and then they would go and recruit other people to be on the investor base with them to go put together this blind pool. But the secret that they all figured out was if they wanted to open up any door, they would all go bring in one or two celebrities, especially sports celebrities. So every single one had Dave Winfield, if you remember him from the 1980s as a baseball player, David Robinson here in San Antonio, one of the greatest basketball players ever. He was on one. I think Derek Jeter was on one just like this random hey we need to get a meeting with anybody how are you going to do that?

25:50We're going to have Don Mattingly on our cap table that was the play and I just thought it was hilarious whenever I would see one of these SPACs I was like okay who did they get? Did they get Ichiro for this one? Who's in this one? That's always kind of been a turn off to me though if I see a big sports figure or something like that I'm like well is this the play? right like why do why do they know how business works um it's it's had the opposite effect on me outside of a few i don't know if i see shack on a cap table i'm very interested but um outside of a few like it wouldn't doesn't make any sense it's a negative signal when the vc deals that i've done when there are when there's somebody who's like a celebrity a celebrity investor um like they're they're terrible they're too busy being celebrities to be like actually like good investors.

26:40They're totally unhelpful. And routinely, I'd be talking to the startup founder and they'll be like, why talk to so-and-so's person and they never talk to the celebrity. I talk to so-and-so's person and they give me this advice and I'm like, that's horrible advice. Don't do that. That's a really bad idea. These people don't know what they're doing. They know how to be celebrities. They don't know anything about how to grow businesses. And I think that's, I see that, I saw that same phenomenon over and over again. It totally jaded me about having big names on your cap table or on your investment table being a creative, just like what you're saying yeah yeah yeah now if if the celebrity wants to start a brand or something like that like i don't know like jessica alba's uh jennifer gardeners what's the what's that little kids food brand um oh yeah they didn't just ipo we're about to up yet i mean she's crushed it they're everywhere uh reese witherspoon is a similar kind of story she's really good at business um jack is great oh yeah and all those names the kardashians really good at business as well yeah Skims I guess is another one I haven't seen how that's doing lately but I mean it's the Kardashians the weight that they still pull I watch an amusement from afar but it's like wow they can still just kind of make anything happen yeah gotta really respect that cool one thumbs down on this one I wish it just looks so scammy that's why I wanted to look at it but it's good radio so cool well we'll wrap it up there if that works for you yeah man alright thanks Jared awesome well thanks everybody for being here this week.

28:05If you enjoyed this episode, send it to somebody you don't like and see if they... No, I'm just kidding. Send it to somebody and tell them that they would get something out of it. Hopefully, thinking about businesses this way and how to invest them and how to make them work, I think it's a great, healthy thing to do whether you're trying to buy a business or not. So send it to a friend and we'll see you next week. Ciao.