Relationships are the Atomic Unit of Deal Flow (w/ Ken Fine, CEO of Affinity)

0:00The worst thing you could do, and it happens all the time across private equity, is somebody reaches out to somebody and the response is, yeah, I know your partner really well.

0:09Ken Fine: We literally were texting yesterday. That's embarrassing. It is. And I've been on the other side of that. Yeah. It's embarrassing. And we get it. I mean, literally, I get emails like, hey, I want to talk to you about this company. And I was like, we sold that company nine months ago. It's not venture capital. It's private equity. It's the private equity funcast. Pour yourself a drink and have a seat. Welcome back to the funcast. We've got a good one for you today where we're going to go deep on CRMs. You know, that's the thing that AI was supposed to obliterate because system of records are no longer valuable.

0:48Ken Fine: Well, we totally disagree. And we have the CEO of Affinity, a private market CRM that we just switched to to talk to you about why we think that's wrong. So let me introduce Ken and have him tell you more about himself. Thank you, Devin. It's great to be here. Thank you for your partnership. So you're more from the venture world. You've run venture-backed companies very successfully. And we can talk about the names as you dive into your bio a little more. You also were at Goldman, so you've seen kind of what the big machine looks like as well. Yeah. So talk about the early career of building businesses that were venture-backed and kind of those relationships you had with venture investors, and then how that led to you taking over Affinity as CEO about two years ago, which I believe has started as mostly a venture-focused business, and you have a lot of venture funds that use it, but is rapidly accelerating into private equity, and I think for all the reasons we're going to talk about.

1:43Ken Fine: So give everybody a sense of who you are, how you got here, and your relationship with relationships. That sounds great. So a little bit about me. My background originally was technical. So I started in engineering, math, and physics in a field that I thought would have no connection to where I am today. I started building or working on teams that built nuclear propulsion systems. So highly technical, advanced mathematics. Decided I loved technology, wanted to learn how to build something different, went to business school. And since business school, have been in, broadly speaking, B2B software and dating myself a bit.

2:19Started in on-prem and then SAS and now AI. So I've seen that full arc of maturation. In terms of relating my background to today's conversation, if you look at the through line of all the companies I've been a part of, they've all were doing something interesting related to capturing massive amounts of data and then applying some type of algorithmic intellectual property on top of the data to create value for customers. The data was different, the technology and the IP was different, but that was very common. And what led me here to Affinity was after my last company exited, I was taking a break, got a call from a board member from that business.

3:02I was talking about relationships. There was a relationship there. He said, hey, I'd like to introduce you to the board of Affinity, and perhaps there's an opportunity for you to join, whether it's a CEO or a board member. What attracted me here, when I took a look at the business, the first thing I was drawn to was the data set. And what I realized, and we're going to talk more about this during this discussion, is affinity had been somewhat partially accidentally and partially intentionally has been collecting and assembling what I'm going to refer to as the relationship graph of private capital.

3:37When I say private capital, starting in venture capital, as you mentioned, Devin, and then expanding from there into private equity and there into private debt. And as you know, very few firms today are pure plays. There's lots of multi-strategy asset managers that have multiple different types of funds. And what I saw was a latent asset of relationships that were driving capital across trillions of dollars of capital across this system, but not really being leveraged or utilized. and that caused me to ask my wife permission to go back to work again. I got permission and I've been here now for two years.

4:15Ken Fine: And what was it, it was the data set too, and then where was Affinity at the time and kind of its maturation? This is pre-SASpocalypse. You know, we've just got the first LLM models dropping. I mean, did you have a thesis going in about, hey, this is how I think the business itself is going to transform and where you thought you could take it given kind of the emerging technologies? Yeah, great question. So lots of credit to the founders who are now on our board and who hired me in that they were disciplined. And as you mentioned in the intro, Devin, started in venture. And their thesis was that venture is a heavily relationship-driven industry.

4:52We can talk about some of the structural differences and similarities between venture and PE. And I see PE in many ways starting to adopt some of the things that venture has done to create that type of success through relationships. So what I saw was a business that had, using business vocabulary, picked a beachhead. The beachhead was venture capital, had achieved 30%, 40%, 50 % market penetration, depending on how you want to characterize that market, but had actually built a technology that was a horizontal technology. It was not a vertical technology. It could be applied across multiple markets, particularly relationship-driven markets.

5:30And I saw the opportunity to both mature the business itself and just execution, having been an operator for a long time, and build out a new set of technologies on top of that relationship graph. Again, we're going to talk about several examples here today that could fundamentally change the way investors generate leverage from the relationships that they have. So that was the promise that got me excited. And then I spent more time talking to the board and obviously joined them here now today.

6:01Ken Fine: Yeah, I want to talk first about how venture sources and how private equity sources, I certainly can offer my opinions on that. You've got a lot of good insight into, I think, over 3 ,000 customers, right? So it's not like you've got a small data set that you can look at. And then we're going to get into the annoying things around CRM and how technology can fix them so you can spend more time doing the important stuff than just managing the CRM. Also want to talk to you about Saspocalypse and kind of, the fact that some people out there think that systems of record are going to get vibe coded away still.

6:41Ken Fine: But let's do this. So here's what I think about is generally broken in sourcing. And I've tried to learn more from the venture world than the bio world for sourcing over the years. And let's talk about middle market, lower middle market, right? If you've got a$20 billion fund, not a lot of proprietary sourcing going on. Sure. Are relationships important? Absolutely. But your relationships are with the people that are going to show you and transact a deal, largely making sure you're in front of them. But you're not like cold calling the CEO of a public company and trying to take it private without anybody getting involved.

7:17Ken Fine: In the middle market, lower middle market, deals happen off outside of transactions or outside of processes all the time. And the goal and the joke in private equity is to find that proprietary deal. So as you look at your venture world and your venture clients and things, like talk from your perspective, how does venture source? And I'll throw in my two cents on what I think private equity can learn from that. But what's the traditional sourcing on the venture world? The way I observe sourcing in venture is it's clearly focused on founders and CEOs. So that's your focal point. And ideally, you're developing long-term continuity or relationship continuity with serial founders.

8:00So people who can start company one and exit, and then that's now an even more valuable relationship, and they can start company two. and often the sourcing and the relationship capital cruise to and is attached to a sing to singular partners so i'm a partner at a venture firm i have my network i've been hired in part i'm at this firm in part because of the expectation that i can leverage that those relationships and my credibility and my brand as an individual human being to get deals done and then i'm going to do a high volume of them. Now, what I'm about to say depends a bit on what stage you invest in, but I'm doing a high volume of them.

8:41And if a few of them are big and very successful, that makes the portfolio. Conversely, and this is your world and you can add to or correct me if you have a different point of view, as you said, generally in PE, and it varies, of course, if you're upper market or mid-market or a smaller firm, but you're creating relationships with bankers and intermediaries that can provide deals to you. What I've noticed, though, structurally within firms is that in the case of many PE firms, you have a bit more of a hierarchy and a team and a machine around you that you can leverage. So you've got, you know, it varies by the size of the company, but you've got a partner, an MD, they may work with a principal and a VP, an associate, business development folks.

9:22So now if you're using your network well in private equity, you can leverage that network across that team. And the imperative to do so, I believe is higher because you're making generally a smaller number of investments. You're buying the entire company most of the time. It's a majority investment. And the multiple on those payouts is lower. So you need those two payouts. You need that sourcing to be particularly effective and leverage that network well. Let me pause there and compare my model to yours.

9:51Ken Fine: You nailed it. And it would be anathema to the venture model that you've got layers of junior people and mid-level people driving like BDRs almost in a sales process. They would be cold calling founders, cold emailing founders, walking around trade shows, trying to gin up a relationship that then hand to their VP who then hands it to the principal who then hands it up to the managing partner when it becomes a real deal. There's some data recently out. The super majority, if not 90 % of all venture returns have originated from 5 % of the funds. And inside those funds, maybe a handful of people inside those funds.

10:28Ken Fine: You can literally map returns to the human who led the deal rather than even the fund. Certainly not the team inside that fund. And where private equity is much more of a team sport. Hey, you've got, well, it used to be that the junior people were sourcing and they would get the senior people involved. It's now turned a lot into there's an entire sourcing team. I mean, can you imagine like Sequoia has a separate team to source their deals and then they get handed over the fence to somebody else on the venture side? That would be like the opposite. You're hiring somebody because they've got these amazing relationships and they're going to get the call because they know everything about cybersecurity.

11:05Ken Fine: So of course you're going to call so-and-so about cybersecurity. That's the basis upon which people like me who've worked in venture as a CEO take the call. I look at who's calling me and then literally if it's cold, then I'm checking out LinkedIn and checking my network and saying, is this someone that's a good use of my time to spend? Do they know my space? Are they credible? Who have they invested in? And if the answers are yes, then I will talk to them. And it would actually hurt the reputation if you were reached out by a firm, by somebody who didn't have that juice, let's call it, with you.

11:35Ken Fine: Not that you would be like, oh, I'd never work with them. But you're like, why would I respond to somebody I have no connection to at this firm who's just cold reaching out to me to, you know. That's right. It's not a good look. Compare notes. Hey, let's compare notes. Let me pick your brain. Hey, I would love to talk to you over coffee. My issue with that has always been, what is Ken Fine getting in that conversation? What's the give to the contact, the relationship? What am I giving? I want to give first. That's a get relationship. Hey, Ken, tell me everything you know about marketing automation.

12:04Ken Fine: Tell me everything you know about CRM. Oh, and I'm going to tell you that I have$10 billion and we buy a lot of companies and yada, yada, yada. It's like, okay, Ken didn't get a whole lot of that interaction. I got a lot of it because I don't know a lot about CRM industry and Ken does because he's the CEO of a successful CRM business. That's been the challenge. Venture doesn't operate like that. the senior person sources, they have the relationships. They're basically hired for those relationships. Like you said, they're going to make a bunch of bets. A few of those bets hopefully pay off. In private equity, every bet has to pay off.

12:33Ken Fine: So private equity has optimized their CRM and optimized sourcing, in my opinion, to manage a process rather than to build deep relationships. That's right. That's right. And I'll add a comment going back to your previous premise, Devin. So I'm thinking back to my last company where I was at, I was CEO of a company called Heap. Got a referral from a board member to an investor at a firm that I knew of, but didn't know it at the firm. Talked to him, said, hey, I've got a thesis on your space, but doing research on your space would love to meet. So at first glance, what was in it for me was my job is to drive strategy for this company.

13:12If you have a thesis, I'd like to hear your thesis. That means you're probably talking to other people. You're talking to my competitors. You're doing research that perhaps I'm not doing. So I had that meeting, turned into several meetings. We weren't in a process. I wasn't planning to raise money anytime soon, certainly within the next year. Told them that at the beginning, said, hey, just want to be clear. I'm not, you know, if you're trying to get involved in a round, I'm not raising one for a bit. We're in a good cash position. Then about 18 months later, when we were beginning a fundraise, reached out because they had developed, I had developed a trusted relationship with them.

13:45That round went quickly, which we were fortunate pre-sass apocalypse, lots of term sheets, high valuations. Another firm came in at a higher valuation than they did. And it was a name brand firm, great firm. I just didn't know the people there yet. And I came to the board and said, I want to go with this other firm that I built a relationship. It's a competitive offer. And more importantly, I trust the team. I trust the partner or managing director. I think I want them on the board. and you know what i'm i have high confidence in the term sheet because i know they know me and the company and they know our strategy and i've talked about our financials so i feel like it's lower risk last thing i want to do is start a process that doesn't end or has friction in it so that's a case where they basically ended up leading a deal that had they come in with everyone else that wouldn't have happened and they got in at a i think a competitive at lower price than competitors who on paper were well known more well known yeah and i think most private

14:45Ken Fine: equity firms that say, we do that too, right? Because we're reaching out, we track all notes, we know, you know, we've handed down this relationship, you know, through the firm's relationship for over a decade with this company we want to buy. And I'd say highly unlikely that many private equity firms have those deep relationships where they are getting the first call, the last call, and the price at which they need to transact. Because generally, and it's only accelerated as funds have gotten bigger in private equity, is that the sourcing has been handed over to the people on the team with the least amount of experience and the least amount of juice.

15:23Ken Fine: So if you have a sourcing team, that's not the investment team. A highly astute executive like you or owner of a business would know just with some simple clicks to LinkedIn or their website is like, oh, this person's on the biz dev team. I'm not talking to a decision maker? Do I want to take this call? And as soon as that happens, and again, there are plenty of good sourcers out there, no doubt, but you're not getting the best people by reaching out with the person who can't get the deal done, in my opinion. So you need to source from the top, always source from the top. Everybody in a company in the firm should be sourcing, but you need to source from the top and you need to use every tool available you have at your disposal, which is, hey, my partner knows you, right?

16:13Ken Fine: And he's spoken to you in the past, or a CEO in my portfolio is deeply connected to you and we want to have a conversation. And the reason why I think you need to find this from, learn from venture is because any company can get started at any time. Private equity is a zero-sum game. I want to own this business and only one person can own it at a time. There aren't 10 buyout funds owning the same business in general, right? Yeah. They're big mega club deals and things, but in general, one private equity firm owns a company. And therefore there's one round. Yeah. That's it. Yeah. So it's not like, hey, we'll do series B, we'll do series C.

16:52It's just a different game. Yeah.

16:53Ken Fine: Yeah. So what are the best venture capital people do? They have an insane network and trust, right? They've got trust and a network, meaning that they're either going to call somebody because they have an idea and that somebody's going to call them back like you did. Right. Oh yeah. I'll call them back. I can get something from this. I can get information. I can get insight. I can get a read on the situation because of, you know, maybe the firm's reputation or the partner's reputation. So private equity can do that for sure. Hey, I've got a thesis in this space. Can I send it to you? Great way to start a conversation.

17:22Ken Fine: Now you need to actually have a thesis in the space that's compelling to the expert on the other end the phone that you're talking to. So what keeps a venture capitalist up at night is that somebody else got a phone call from somebody at Anthropic, OpenAI, Nvidia, name your great brand name company, Microsoft. They're going to leave and they're going to start a company. And they didn't call you. They called Marc Andreessen first, right? Or they called Gil or they called whomever at Sequoia. That's the nightmare scenario for a VC, that they didn't even get the call and a company got funded in stealth mode before they even knew about it.

18:04Ken Fine: Private equity takes the approach of, well, hey, there's only a finite number of companies. There certainly is a finite number of humans who could start companies, but it's way bigger than the number of companies you could go buy in a private equity transaction. And they're like, oh, yeah, if I just do my calls and check the database and call the bankers and send some cold emails and things, I'll be fine. I would say most private equity people should think like venture people, which is in our database, there's 40 ,000 small software and tech enabled services businesses in North America that we would have some interest in acquiring.

18:39Ken Fine: Just based on their SIC code and the sector they're in and maybe their employee number as some proxy for size. our job is to know every single one of the owners yep whether that's management or private equity or venture whoever of every one of those companies we need to be the person they would think of like oh i'm thinking about a transaction let me call devon first and that is everything we do and everything we do from the podcast to the marketing to the sourcing engine to all those things are there are 40 ,000 companies I don't know yet the owner of well enough to get that phone call six months before they ever decide to do something.

19:21Ken Fine: And that's what I think a CRM should do. Yeah, if you think about a provocative assertion to, I guess, re-summarize what you just said, Devin, and put it in quantitative terms or mathematical terms, the aspiration or the The asymptote is, I'd like to have a meaningful or trusted relationship with every person, CEO, owner that I'd like to buy their company. Now, every single one, that's an aspiration. So then there's some level of prioritization and what are the best set of companies and owners to spend your time with. But when your mindset moves there, as opposed to focusing on those companies that are in a process, or that it's not your relationship.

20:05It's a relationship created by a biz dev associate. It's a different calculus.

20:10Ken Fine: Yeah. Now, I think a great CRM that knows who in your firm knows everybody is a very powerful tool for a biz dev associate to say, Oh, Devin knows this person. I shouldn't call them. Devin should. So let me tee up Devin with all the information he needs to make this phone call or send this email rather than have it come for me. And that is another challenge. Most private equity CRMs, and I'm on my fourth or fifth in my career at least, is they're built to manage a process, not to foster relationships. And the process in private equity, and you're straddling both. Most of your customers are venture.

20:50Ken Fine: You've got high market share there and you've accelerated into private equity since you joining, I think significantly, adding a few hundred private equity customers in the last couple of years or so. So something's going on. And I think people are realizing like, oh, I've built this machine. So yeah, deal cloud, go down the list, right? CRMs that were built to manage your process. When is the IOI due? When's the LOI due? How many deals has this banker shown me before, right? That's a huge piece of the CRM for most private equity CRMs is how many deals have I seen from this banker I've told my team, I don't care.

21:27Ken Fine: I mean, I love the bankers. We rarely buy a company from a banker given our size, which is why I'm so focused on knowing everybody we possibly can. But who cares if the banker showed us one deal or 100 deals? Those are in the past. What's going to happen in the future? Those are already owned by some other private equity firm. That's right. I mean, one way I think about it is you've got, because our technology does both. It helps you manage a process and it helps you leverage relationships in the context of the process. And one way to think of it in terms of value proposition is if you're working with a technology, a CRM that manages the process, the value proper, the benefit is generally saving time.

22:09So you're running a process with technology and therefore it is easier to do than manually or better than some other less capable technology. The value proposition when you use technology to define and leverage a relationship graph, which we'll talk more about here soon, is actually getting deals you wouldn't otherwise have gotten. So that's alpha as opposed to time savings. Both are numerical and quantitative and valuable, but the latter is more so, or the alpha is more so.

22:41Ken Fine: Yeah. You want to, again, venture. The whole game is I know something's happening before anybody else knows it. And I've already wrapped it up. Right. I know somebody is leaving a company and starting something and they haven't talked to anybody else because they started with me first. Take Fred Wilson at Union Square Ventures. If you're doing a community, right? He did Etsy. He did Twitter. Lots of other businesses. Coinbase and things, I believe. Like, you're going to call him first. If you can get to them and you're starting a business like any one of those that kind of is a network effects business or a community-based business, marketplace, how do I get to Fred Wilson?

23:17Ken Fine: That's your challenge as a founder. Fred has cleared the market. If you're going to do it, everybody who wants to start a business in that space is coming to you first if they can get to you. And in private equity, not at all. Some firms have carved out some niches here and there, but I don't think they're generally like the owner of that business thing. Thinking about it in the same way. And this is an opportunity on the marketing side for private equity to get better at and try and go direct with things. But let's dive into what's annoying about CRMs and why you would join a CRM company, given that everybody loves to hate their CRM and kind of what gets in the way.

23:51Ken Fine: So what are the, again, you came into this industry from other marketing automation and other enterprise software worlds. That's right. What did you see about what was good here that you liked and where technology could make it even better? Like, let's get in the nitty gritty, like how you work, how you even work with a CRM. And we'll get into how AI changes that. Sure. So it's an interesting question in that when I got, going back to my getting started introduction, when I got the call from the board member about Affinity, I looked up Affinity and my first reaction was a CRM. Isn't that already figured out?

24:31That does not look like the place to place my next bet. Then when I went deeper, I realized, okay, this is a one plus one is much more than two strategy where, yes, there is a underlying CRM that in this case, and I think it's a smart bet, is purpose built for the workflows of private capital. So venture capital and now private equity, which is different workflows than SaaS, for example. So I saw, okay, there's some discipline here. This is built from the ground up to help people who do this type of business, as opposed to a generic CRM that needs to go through some kind of complex. You mentioned Salesforce would be, obviously, that's a horizontal platform that needs to be tuned to different verticals and different workflows.

25:13I saw, all right, on the workflow side, there's a reason to believe that there's some rigor that's been injected here that make it effective in this market. Then the second piece was what we've been talking about, which is this is a platform that has been built to essentially take all of the communications of the people using the platform. So all of the emails and all of the calendar appointments, and this is even pre-AI, AI we can do even more, and essentially construct the CRM, reverse engineer the CRM from that data. So if you and I are having this meeting, we're meeting each other for the first time, and you're on Affinity, Affinity would say, oh, Ken and Devin just met.

25:54We don't have a record for Ken in Affinity. We're just going to create it. And then we're going to do a whole bunch of work externally to enrich that data about Ken and say, well, who is Ken? Well, Ken's the CEO of Affinity, and for that, here's his background. What is Affinity? Affinity is funded by these different venture firms, and this is what their cap table looks like. So now the CRM is creating itself. And then the next leap here was, okay, if you do that and you're trying to eliminate manual work and data entry, you have essentially, almost accidentally, mapped out all of the relationships within the firm.

26:31Because you're looking at everyone's communications. You're looking at their emails and calendar. Now with AI, you're looking at notes and note-taking devices and pulling that in. You're taking data out of pitch decks and sims. all that is automatically being ingested and you're creating a complete record of communications and relationships and now you can even look into the dialogue that you and i might have in an email and characterize that relationship oh it looks like ken and devon or have a pretty good personal relationship and rapport based on what they said back and forth or there's tension in this relationship and that might affect the likelihood of this deal getting done that can be flagged so effectively you have something that can manage a workflow but in a way where the relationship signals are integrated in to each step from you mentioned sourcing sourcing is obviously a critical one that's that's where the you know the initial investment comes but it also comes in value creation hey one of my portfolio companies needs a cto who has this kind of background in health tech with companies of this maturity well who in our firm knows people like that it's time to start thinking about an exit.

27:36Who are some of the strategics that could be interesting acquirers, just like developing relationships with CEOs you might want to invest in or founders and owners of businesses? You may do the same thing with a strategic acquirer, but out six months, 12 months, 18 months and build those relationships. Well, who at the firm knows these strategics and what's the nature of that relationship? So what I've seen coming to, if any, what brought me here and what we've been building is that combination of purpose-built workflows integrated with capturing and then leveraging the relationship power of each person in the firm.

28:10Ken Fine: Yeah, we're having this conversation in the summer of 2026. So people in the future, it's not so bad. Don't worry about it. It wasn't as bad as everybody said it was in the summer of 2026. So kind of midway through the SaaSpocalypse, right? As we're speaking, Microsoft's just put up a monster second quarter with amazing growth. And like, so software's not dead people. And everybody was saying in February, oh, especially to CRM, AI is just going to make it obsolete. You don't need a rag database. You don't need just some dumb database. You're going to abstract away from it using AI. We wrote a piece in March called The Ghost of Software Future.

28:51Ken Fine: It's a short little 10 ,000 word piece about kind of where we thought software was going to go in the age of AI. I'll send you a copy. And it was basically like, no, AI will domestic or sorry, software will domesticate AI. AI is software. And do you think that Mark Benioff and Ken Fine and go down the list of enterprise CEOs in systems of records are just going to sit back and wait and let some AI company abstract them away before they do it themselves in some interesting way or use AI in some powerful way? It's like, no, it's not going to happen because for 20 bucks a month, we all have this same powerful model.

29:28Ken Fine: We can all build the same stuff. And you have context and you know what the last mile is. To your point of, we moved away from a horizontal database. It was fine-tuned for private equity, but not for our way of private equity. It was much more process-driven than relationship-driven. And anything you put in there needed to be input. This is the challenge. And I think this is why we were interested in what you're doing. And my sense is other CRMs will go there too, but we liked what you guys were doing. here is like, I don't want my associates and my VPs logging stuff into the CRM. I mean, literally it's a two or three hour process on a Monday when they come in.

30:09Ken Fine: We do our Monday meetings in the afternoon on purpose. So you can come in on Monday, get all everything cleaned up, get your IC memos, finish everything up, tick it and tie it and we'll meet in the afternoon so we don't ruin everybody's Sunday night. But my associates spending a lot of time on Monday morning, updating the CRM. complete waste of time complete waste of time in my opinion so what does affinity do i mean we're you know in the early stages of it is like and don't take this the wrong way it's like a big messy data lake it's got everything in it and then and then you go append stuff so i'm not like wading through just like the core crm kind of sloppiness of all the notes all the things all all the attachments, all the things that are inside our email box and our notes and our calendar history and all those things.

30:57Ken Fine: I'm creating lists on top of that. I'm creating workflows on top of that that are extracting, like, I want all the mess in there. I want all the notes. I don't want anybody to be too precious about what they have to type in there. Because, I mean, yeah, most CRMs, you're like, okay, let me summarize this meeting really fast and put some notes in the CRM. Yeah, we'll capture all that raw data, essentially, is what you're saying. Yeah, so you guys capture all of the raw stuff. I could go into, and with the MCP server, we'd just go into Claude and basically be like, here's the transcript, here are all my notes.

31:27Ken Fine: I'm going to use Whisperflow. I'm going to just talk into Claude for a minute or two, get all my raw thoughts off my chest. If you're not using Granola or Fathom or some other note-taking tool or Arvo, just kind of tuned for regulatory, regulated industries. Yeah, it's all that messy stuff in there. And I'm not going to weed through the mess. I'm going to have the CRM extract the value from that so we don't edit ourselves. We don't accidentally miss context by trying to be very specific about this little thing we're going to put in there. It also says, hey, I mean, we've had Parker Gales since 2014, right?

32:05Ken Fine: So we're 12 years in. Literally, every single conversation I've ever had with anybody is in there. and my newest employee can basically very easily say like, oh, Devin's had, I can see all the emails Devin has had with this person dating back to this, you know, 12 years. And I can give me a summary of kind of what's Devin's relationship with this person rather than the worst thing you could do. And it happens all the time across private equity is somebody reaches out to somebody and the response is, yeah, I know your partner really well. We talked, yes, we literally were texting yesterday. That's embarrassing.

32:45Ken Fine: It is. And I've been on the other side of that. Yeah. It's embarrassing. And we get it. I mean, we literally, I get emails like, hey, you want to talk to you about this company? And I was like, we sold that company nine months ago. Right. Or like, we don't even own a majority of that company anymore. Or like, you didn't even do the homework to find out like, that's not even in our portfolio anymore. right so like what your crm is doing is impending a lot of this data hey here's this company here's this thing that was this happened here's what's changed hey this person's appears to have moved jobs did we get that right or do we get that wrong now for people firms they need to decide how much transparency do they want inside that email machine right so you know i went through and it's like my travel agent it's like okay we don't need to have all my travel agents in there so like at essentialist.com is blocked.

33:33Ken Fine: So like it's not, it's not, you know, filling the CRM. But you could argue like, maybe you do want that stuff in there. You'd know more about me and where I'm heading on vacation. And then like my brother's, like, you know, I don't need my brother's Gmail, some associate to come across an email. I may have sent my brother for my work account. Now from a compliance standpoint, my, my CCO has all of that stuff from a mess, you know, mess into the, into the database. We're doing right now, like the, the, who sent it, who is on the email chain and then the title of the subject line of the email, we're not right now sucking all the context for everybody, for bankers, for executives, for portfolios.

34:09Ken Fine: Yes. But for more transactional conversations, we're not sucking everything. And that's all configurable, right? You can decide. Oh, it's so configurable, Ken, that I did it the other day. It was like, I was logged in. I was like, oh yeah, we don't need my travel agent here. I'll just put them on the block list and it doesn't need to muck up the database. But I think what we want, what old CRMs did was you had to edit before you input that's right now it's like no no no put it all in there have everything in there and the machine will will now discern what you should know about it is that fair the way yeah that is fair the way any way to think about it the way we think about it is there are now two layers this is a little bit oversimplified but it's directionally true there's two layers to our crm our technology there's the system of record layer and and you put it well devon the gold hairs get everything in and it's raw form in fact raw form in the world of ai is better because there's nuance there's context there's connotation that's better than cleansed in many ways because now we can build a context graph and understand the way people's relationships are are forming or have formed so that's your system of record level that's the data and a big part of our roadmap is every possible form of data that we can pull in that's relevant of course to our customers business we get in there then you have the system of action layer that sits on top of the system of record layer.

35:28And that's been accelerated and enabled by AI. So that's where you're building tools, skills, agents, or conventional UI elements you would have in an old SaaS platform to access that system of record through automated actions.

35:43Ken Fine: When you talk to customers, what are they annoyed about in general in CRM or prospects? Like you don't switch CRMs, you know, over a weekend. It's a, it's, you know, almost like open heart surgery for a lot of companies to be able to make that transition. One of my very large, I have a very large relationship, a very large firm and they have, well, I sound like PE guy all of a sudden. I have a very large relationship due to my role. They were asking us about this ghost of software future piece we wrote. And they're like, well, isn't AI just going to kind of take over all this stuff and you don't even need any of these things anymore?

36:19Ken Fine: And I said, what CRM do you guys use? Business Brown for 50 years. Dynamics. You use Microsoft Dynamics as your CRM. Okay, why haven't you switched? Well, it's so hard to switch. Yeah, exactly. That's why people aren't just going to switch their systems of record because AI can do it now. So what's happening to you is what you're doing to yourself is what people said four months ago that AI was going to do to you. it's like oh yeah sure there'll be some rag database and we'll just have you know claude sit on top of it and you just it's like no no no we're gonna build the ai into the tool we're gonna abstract ourselves to that system of engagement you know system of action but that system of record needs to you just need to stuff it with everything messy nasty stuff everything in there and don't worry about it don't edit yourself put it all in there and we'll we'll figure it out for you and tell you what's important.

37:15Ken Fine: That's right. I mean, in a sense, our strategy has been to obsolete ourselves. Move that quickly with AI. To your question on why do people switch, the answer to that question has changed dramatically in the last six months. So if you had asked me that question up until February, March, I'd say the reason someone switches a CRM is because of manual friction and too much work and there's people aren't entering the data and therefore there isn't really a good system of record. And those things are still true. what's changed now as i talk to colleagues and folks in on the tech space or in pe or in ventures everyone is now in the process of rethinking their tech stack and strategy in the context of ai so everything is opening and everyone is engaging at a more strategic level and we took advantage of this time to basically completely reinvent our product riding the tailwinds of what ai can do everything from how we build products internally, but really rethinking the way a CRM would work in that context of there's a system of record, use AI to make that the best system of record possible, get everything in there, and then build your system of action through a set of agents that are patterned after the workflows of our customers.

38:29So there's sourcing agents, and there's deal qualification agents and there's investment committee preparation agents so it's it's it's in your your world your language but then to this conversation then you tie in relationship intelligence agents to each of those steps so if i'm doing my sourcing and i would like to be introduced to the 10 ceos that i should know so as part of that sourcing process there's an agent that combs through well these are these accounts you're looking or the targets you're looking at the companies you might consider buying. Here are the people that are running them.

39:04And then here are the best strategies to meet those people looking at the entire relationship graph of your firm. We'll look at the context of the way those relationships have progressed. We will pre-write the emails for you or the outreach in your voice, and then you can decide which to send and which to edit. So of course you would retain control over the final outreach, but you're now combining that data layer with an action layer that's integrated into relationship leverage, if that makes sense. I think of it as ambient CRM, meaning it's listening

39:35Ken Fine: to your organization through the systems you use. And one, I mean, we're not going full Bridgewater here and recording every single conversation we have in every single room. I can see value to that. It gets a little creepy at times. Also, there's a heavy regulatory compliance risk to that. You wouldn't take notes in every single meeting and keep them in a leather-bound notebook so the SEC could come in and say, oh yeah, just hand me all those. We'll go through those. Not everything needs to be written down. Not everything should be written down. Not everything needs to be stored forever. Every email is obviously stored forever.

40:15Ken Fine: That's a great place to start. We're an opt-in record-a-meeting people. We don't record every single meeting. We're not recording all of our Monday meetings. We're not recording all that stuff. I think there's more downside and regulatory risk for doing that than not doing that. But what I can do is instead of recording a call, and I think I've been on meetings where the other side has said, you can't record this. That's happening more and more. So I think there's now using something that you don't know is being recorded. I assume everything I'm doing is being recorded, unfortunately. That's fine.

40:47Ken Fine: But just tell me you're recording me. So we're not going to record somebody without their consent just to fill our notes, right? Just to fill our notes. So think of it as ambient CRM. It's just capturing everything that's kind of happening all around. Don't worry about the big messy pile below the surface. You want everything in there. And then you're going to drive some action. So here'd be an example of how I think it works. And I'm seeing it work this way. So a deal comes in. Yeah. Affinity has read the email. sees the attachment that there's a teaser about a company of a certain size in a certain industry with a certain description.

41:26Ken Fine: And it immediately alerts whoever in the team, maybe who received that email or whoever on that team has a thesis in MSPs. It says, hey, this deal just came in to somebody else in the firm. Or this deal just came in on a thesis that you have. Here's the people you need to know about this. Here are the people you already know and the strength of that relationship and how you would get to them. And here are the people you don't know because I'm appending this record with PitchBook and source, whatever other tools we have attached to this machine. And we may be doing that through the MCP server on Claude.

42:05Ken Fine: We may be doing it soon, but you're orchestrating that because anytime something comes in, you're asking, what do we know about this already? What don't we know about this already? Where can we go get it? That's right. Right. And basically, what's the relationship strategy for this opportunity? Who should we know? Who knows them? How do we get in touch with them? And then, as you said, Devin, taking that opportunity and ingesting all of the data and whatever attachments, getting that into a system of record level, right? So storing the data and then routing that to the appropriate partner or person in your firm that should be looking at it.

42:36Ken Fine: Yeah. And I would say first, have an ambient CRM. Just grab everything, capture it all. Now, again, within the regulatory requirements of like, yeah, you can't just suck down a SIM and hold it forever. I know every private equity firm mostly does that, but you should probably reread your NDA. You shouldn't be doing that. And then number two is on this reactive strategy, somebody reached out to us with something, who's the best person suited in the organization to go respond here? That's one. And now that assumes you have a jump all culture rather than a mine, mine, mine. This is my deal. This is my sector.

43:10Ken Fine: This is my relationship, which I think is not useful. On the proactive side, you go into the machine and say, who do we know in MSPs? And he says, hey, here's all the conversations you've had since before you even got here, Mr. Associate, about MSPs. Here's everything. You know everything everybody in the firm knows now. And here are the things you're missing. Go get those things. And how would you go get those things? Okay. Well, it looks like Devin's two or three hops away. Well, how does it know that one? It's literally sucked in every email. I mean, I think it sucked in 20 ,000 people I've emailed, I've had emails with in the last 10 years.

43:46Ken Fine: It's insane. Right. That's the crazy. That's just me. I think that's one. So I'm not going to go through a way through all that stuff. And I don't want to tag them with this and tag me that you guys are doing all that. You're tagging it. You're appending it. You're adding their, you know, and then I went and, you know, you download your CSV at LinkedIn, right? because LinkedIn's API is locked down so hard. Yeah, so every quarter I download the CSV from LinkedIn, update it. Maybe there's a new 500 people in there from the previous time. And then it's like, oh, okay, now it knows who I know on LinkedIn.

44:15Ken Fine: That's right. So let's go, Devin's emailed this person. He's connected on LinkedIn. He's been connected for this long. Okay, that's interesting. Here are your first degree connections. Here's how that maps to the explicit communications you've had internal within the firm. And here's what a lot of people listening would say. Yeah, we already built that a few years ago. oh, we're building that now. We're rolling our own and I want you to react to this. And my response to that is, well, one, if you're a software investor, why roll your own? You're kind of nuking your own investment thesis that software can just, you can just vibe code it yourself.

44:46Ken Fine: So one, that's probably some downside on your portfolio if you think you just roll your own enterprise systems. One, and two is like, it's a waste of time. You're not as good as enterprise software people to build this stuff. Let them do it. They're going to build all the AI into it. They're going to build all the connectors into the other things, right? Like you guys are already connected to pitch book, right? So you got to get your tool, pitch book, Luminic, you know, so I've got my portfolio monitoring. I've got all my portfolio data. I've got all their competitors. I've got all everything.

45:14Ken Fine: Then I've got pitch book, every company that we were interested in, everything we need to know about them, plus market research, plus who do we know? It's like, okay, that's already built guys. And the connectors are either built or already built are going to be built and they're going to get really good. So why waste your time building all this stuff yourself? Because it's going to break. just let the experts do their jobs. Yeah. That wasn't supposed to be an as explicit pitch for you guys. It came out, but it's like, let them do your job. Like you're going to come up with stuff that I'm not going to think of.

45:43Ken Fine: And like, I want you to figure these problems out for me. And if they're not, I'm not going to renew. That's the whole point. Like if you don't do this stuff, I'll find somebody else who can. That's right. Do it myself. Yeah. So I'll, I'll add to it. Well articulated, Evan. You know, there's a saying generally in software that when you build software, and I think this is even more true with AI that you put roughly, let's say a quarter to a fifth of your resource into building it and then the rest into maintaining it. So getting a prototype or something lightweight or vibe-coded air quotes is just barely the first step.

46:13And in this case, the conversation we're having, you've got two things I'm oversimplifying to build. You've got all the workflow stuff that we talked about managing a process, and then you have all the relationship capabilities, which includes integrations and capturing data and then complicated things like entity resolution, like, okay, I've got five Ken Fines here. Is this one guy? He's on this board and he was CEO of this company. Oh, actually there's two of them. There's Ken Fines one, there's Ken Fines two. There actually is another Ken Fines out there. So that's surprisingly complicated.

46:46And then these things, as you said, they're going to break, particularly when you build them with AI. So someone's building that, someone's maintaining that. So if you were to do it yourself, you might be able to build a, I don't know, a BCRM and a C relationship intelligence. What we've done is built the platform as an open platform. So if you do have those kinds of resources and you want to think that way, then build on top of our MCP, build on top of our data shares in Snowflake, take our agents and make them, you know, configure them to your use cases, make them even better. I was on a customer council meeting this morning, a set of customers that give us input on AI.

47:19And I'm actually looking at my notes right now. and his quote was on this topic. We had this exact conversation because they're leading edge AI implementers in PE and VC. He said, Affinity will do the things that Affinity does better than we could, which is essentially what you said. He says, hey, you guys tell us your roadmap. You do what you're going to do. I don't want to do what you're going to do, but I've got some really smart people who care about AI and I'm going to build on top of what you do.

47:43Ken Fine: Oh, I'm convinced that there are a lot of funds out there that have built some really cool stuff in the last few months. And it hasn't fully closed the loop yet. They're still 10 % away from actually closing the loop. It looks really cool. You've made a ton of progress, but you're like, not everybody's using it all day, every day, because we're still missing that last mile. We're still missing that thing that's really important and a critical piece to it, because that's the hard piece. It's like building the MVP without including the most important part of it. Like, hey, we built the MVP. Did you build in transaction processing into that?

48:19Ken Fine: Oh, no, no, because that's really hard. okay, well, yeah, that's why you should build it into the MCP because it's not going to work if you don't do the hard thing first and figure that out. On this same customer council call, one of the most early adopting firms said almost exactly that. They said, we built a lot of stuff quickly. And he said, we may have built too much too quickly because we were so excited about what we could do with AI. And then there's a combination of what you're calling the last mile, some of the corner cases and edge cases and the maintenance. said, I've created this, a lot of work to either finish these things and or maintain them.

48:52And that's what led someone else to, hey, let's show us your roadmap. You build what you build. The things you're not going to do, we'll add to, but you're a software AR company for a reason. We're a PE firm for a reason.

49:04Ken Fine: Now, again, I think every CRM company out there is having this conversation, figuring these things out. It definitely depends on the stack and the core that you've built on. If you've built on something a little monolithic or you've built on something that's really driven more towards managing a process than managing people relationships, process stuff is easy in my opinion. Our joke around here is before Claude, I had five unfinished projects after Claude was released in February. We really started getting a lot out of it. I have 105 unfinished projects. And that's true. Everybody built some really cool stuff.

49:38Ken Fine: We built some really cool stuff in March. Nobody's using it anymore. We just had our offsite and we literally spent an hour on the offsite saying, let's go through everything we've built, all the tools we're using right now, everything everybody's built. What are we still using? Like any associates, what do you use every day that we built? And there's some things like, yeah, I don't use that one anymore because this replaced it. Yeah. The friction of getting started is very low. Yeah. Therefore you can try a lot of stuff, which is great, but then you have sprawl that you need to manage or deprecate, right?

50:06Ken Fine: Well, the easier it is to build software, the more bad software we're going to have. That's true, too. Just like the easier it is to make music. A lot of bad music out there once it got really easy to make music. You know, I mean, there's the app store chart we've all seen, which is the number of apps that have been, you know, loaded up to the app store. It's an astronomical, you know, increase. And then the number of apps with zero reviews or downloads is like basically the same exact line. I was like, yeah, nobody's using any of this stuff. I get that your grocery store notes app was very important to you and it was easy to build over a weekend with Claude Code, but nobody else needs it.

50:46Ken Fine: Yeah. Not a lot of durable value there. All right. Let's talk about where you're headed, where this is all headed. Because I do think this is either going to be a positive or a negative. I think people are trying to build the operating system for private capital and coming from it from different ways. You've got the private equity workflow companies, right? Saying like, hey, we're going to optimize the, you know, build the model, run a process, you know, take the data room, write the IC memo and all that stuff coming from the workflow side. Then you've got you coming from the CRM side. And I, you know, I believe you guys have said, hey, we want the operating system for private capital and kind of what that means.

51:22Ken Fine: So Ken, I want to talk about where you're going next because we've seen the roadmap. It was part of the reason why we made the move to you guys as we were evaluating things is where are you headed next? What is the future roadmap for you guys? Look, and we'll start with that kind of core system of record layer and move up above that because I know you've got some layers. Sounds great. So our strategy is to build an operating system for private capital firms like yours, Devin, and that has four basic pieces. We can go through each one. The first piece is the system of record. And when I call it the messy thing, I don't want anybody like, oh, no, Affinity is not messy.

51:58Ken Fine: Affinity for us allows us to be messy about what we put into the CRM, unlike our Salesforce CRM, which the only place we could put stuff in was in the notes section, really. And it's like, so you basically edit yourself and you only put a couple things in there where you go in a week later and you put some stuff in there. For me, it's like, no, I want to throw everything we possibly can in there. I want all the messy, every email, all the notes, all the attachments, whisper flow, commentary, napkins, scan, take a picture, throw it in there. Because I know a layer above it, we manage that data, but we kind of wanted everything in there.

52:37Ken Fine: So you got that covered. What's the layer above that? Layer above that I think of is the compliance and governance layer. So this is the layer, the security blanket for the firm that says sitting on top of that set of raw data are a series of controls that at Affinity we started building when I joined. So over the last, let's say, 12 to 18 months. And if I were to simplify it, a lot of it is our capabilities that govern who can get access to what information within a firm. Team A is working on DLA. Perhaps you don't want Team B for some reason to have access to that information. or you don't want your certain people syncing all of their emails and everyone else has access to that personal information.

53:21So it's very careful management of information access across the firm. And that's, by the way, one of the things I've learned about this space is that's another reason that a platform like ours that's purpose-built for private capital will be different in this way than a horizontal platform that wouldn't generally need to have this type of fidelity of control if you're building for a SaaS company. It's just not a use case that's terribly relevant.

53:50Ken Fine: Look at a SaaS company, it's like, hey, I want to be able to see what everything's happening in the pipeline. A private equity firm is, I don't necessarily want my VP to know that that LP turned us down in the fundraising process because I'm managing that message internally. I don't need everybody to have access to every email from every managing partner across. So I totally get that. Then my chief compliance officer is saying, hey, Devin, love that you want everything in there, but understand there's a records retention requirement here. Anything that goes in there has to stay in there. So how do we manage that process from a purely compliance standpoint?

54:23Or you might be a very senior, you might be yourself that runs a firm and you might decide that people at a certain level in the firm shouldn't have access to all of your emails. And you just say, hey, I want to have certain people I'm going to give access to and certain Certain people can see that I have a relationship with Ken Fine, but I don't want them to be able to read or know exactly the details of that relationship. So we've built all of that into the compliance layer. So that's piece two that sits on top of the data layer. That way you can capture everything, but then manage it with high integrity.

54:53Ken Fine: So the way we've done it is, you know that Devin has a relationship with Ken Fine. You know the subject line of all his emails with him. You know the longevity of that relationship. and you can read every single email Devin and Ken have ever sent. Or, well, you just see that Devin knows Ken and for how long. You see that Devin knows Ken and here's what they talked about. You know, Devin, here is the topic of the conversation and everything. So you can choose those three layers is what we've experienced, which I get among other compliance bells and whistles. So, all right, now let's, what's the third layer on the cake?

55:27The third layer is now moving into the action layer. And the action layer has many elements, but the primary element now are comprised of agents. And the agents are organized by investment workflows. So example would be a family of agents that are oriented around sourcing, a family of agents that are oriented around deal qualification, around preparing for and following up on an investment committee meeting, around LP management and LP outreach, around exits. So each of those are a category and have a series of sub-agents within them. And the way we're approaching a lot of that work, Devin, is we pick customers to team up with and we build many of them bespoke for them, learn from that.

56:12And then what's common comes back into our main platform.

56:15Ken Fine: Hey, Devin, looks like you guys are preparing to launch a new fundraise. Let's get you started here, right? We ran the fundraising agent and we did a lot of the heavy lifting for you to get started. you can use it, trash it, or adapt it to your use instead of saying like, all right, here we go. Time to fundraise. Let me go Cole through all the shoeboxes of emails and notes and things. It's like, hey, let us get you started with these people. These are in the existing LP bucket. These are in the perspective bucket. These are in the haven't met them bucket. Oh, and by the way, we tapped into pitch book.

56:49Ken Fine: And these are the people who've made recent allocations to small lower middle market tech funds. You should probably add them on their list because we see them on your list yet. Exactly. These are people you should be considering or reaching out to that perhaps you're not. And then for across the board, here are the best ways to get in touch with those people. You might have a relationship personally, which is great. If not, maybe it's someone else in your team. And then we'll even stack rank who we think are the best sources of introduction based on the quality of the relationships and their previous willingness to do introductions and how effective they are.

57:17Ken Fine: This is going to be interesting because you're going to, Rogo and Metal and other people are coming at it from the deal process side. Hey, you got a deal in, you got a data room, here's a workflow, we're going to build a model, we're going to build an IC memo or what we would call an intro memo on a deal. You're coming from the CRM side. We know everything about you guys and we see that these are the things you do with these relationships. You buy a company, you sell a company, you raise a fund, you do these things. So you're going to build workflows there. So it'll be interesting to see where that meets in the middle and whether starting with the relationships was the atomic unit of that process or a call from a banker was the atomic unit or the beginning of a thesis or something.

58:00It's an interesting word that you picked. When I have all hands at our company, I often say the atomic unit of value for us is the relationship.

58:08Ken Fine: Well, hey, I appreciate you said atomic unit because I use that all the time and everybody in my firm is sick of me saying, what's the atomic unit here? Which is literally like the atomic unit is the owner of a business. That is our atomic unit. We need to know every owner of every single business we would ever consider buying. We need to know them so well that if we called them on their cell phone, they would pick it up on their way home from work and say, hey, Devin, what's up? That's it. If we haven't gotten there, we have failed. We will never get there. but as that is the aspiration yeah parker gale to get there that is why we have this machine built to scale intimacy you i want everybody to know me before i've ever met them and to feel like i would take a call from that person and that's why the atomic unit is a relationship with an owner of a business and then from there we try and find the six degrees of kevin bacon that would be better, right?

59:03Ken Fine: So it's the owner of the business, maybe somebody who works at the business or has the ear of the owner of the business, maybe the investor in the business, the advisor to the business, a friend of a friend of a friend of the guy who owns the business. I mean, that is the whole thing. So I'm mapping, how do I get to Ken? I don't know Ken, I've never spoken to Ken, but I know somebody that based on our LinkedIn, he's connected to Ken. Hey, can you, do you know Ken? I don't know Ken that well, but I know somebody else who knows Ken. And then that's how we get to you. And along the way, we're trying to have social proof that this introduction to Ken is going to be really well-received, really well-received.

59:37Ken Fine: And that is the magic of what we're trying to do. All right. So what's on the roadmap? Where are you headed next? Where are things down the road that you haven't released? And people can go check press releases and things. A lot of the agentic stuff you guys have released, we're playing with. It's super cool. But yeah, if people saw you a year from now, what would you guys be doing? The way I would characterize the next year is taking the action layer that I've described, the agentic layer, and building that out progressively more and more robustly. So you take, let's say, sourcing or deal qualification.

1:00:16That's a big concept. Each of those have a series of sub-tasks and sub-relationships, or I should say sub-agents. So spending the next year validating those, iterating those on-premise and forward-deployed teams with customers, and then putting that back into our platform so that a year from now you would say, wow, anything that I would do within a private capital firm, we've built out a responsible, effective set of workflows that are integrated with relationships. And then the next piece on the roadmap is actually the last one I'll mention here is I'll share in the context of an example. So imagine, Devin, that we could share with you visually your relationship graph and say, here's a visual depiction of your actual relationships where each node is a person that you know.

1:01:09imagine that relationship graph is a diagnostic and it's a heat map red yellow and green green is a healthy relationship red is an unhealthy relationship and there's some way for you to look at that and see which relationships are most important for someone like you for someone who's trying to do what you're doing if you're a partner if you're a managing director if you're an associate and then compare that to other people like you so you can get a sense for how how strong of a relationship graph asset do I have? And then actually give you prescriptive recommendations on what you should be doing to build your asset, your relationship asset, to enable you to be successful in your job.

1:01:52There is an article published, a couple in the Journal of Finance, and they're looking at what are the big drivers of investment returns. And their conclusion was the quality of the relationships and the human capital of the partner or the person that they were evaluating. So that's part of what we're doing is starting to actually enable you to be more successful at your job, not just the firm to be a more successful firm.

1:02:16Ken Fine: I'm glad that we're going to end on this, which is great. I would hope people wouldn't use your machine and other machines like it just to increase the volume of automated outreach to humans because this is happening right the machines have gotten better and it's like one of our associates can send a thousand emails a month to founders of companies yeah you know i joke the inc 5000 list is like christmas and your birthday for deal sourcing associates it's like oh my gosh look at all these people i can carpet bomb on linkedin and over email and when you and i started in this in our respective businesses can we had to actually get hung up on.

1:02:55Ken Fine: Like we didn't just get to have not an email, not get responded to. It's a lot different than just somebody ignores your email than somebody actually says, why are you calling me? How'd you get you my number? Click. Don't ever call me again. So I would hope that people don't use all this amazing technology to basically just say, I can reach out to way more people in an automated fashion and just increase the top of funnel. I would hope they would use this machine to say, oh, how do I go deeper with these people now that the machine has done all the heavy lifting and tedious stuff for me and is giving me suggestions and pathways to do this so I don't have to do all that prep to then know who do I need to know?

1:03:41Ken Fine: Who do I need to know better? How could I get to know them better? What makes them tick? I want to be able to say, yeah, I get to be more human, more present in the meeting, more connected to these people. And again, it's back to this idea of high tech, high touch. Use the high tech to be high touch. People want connection more deeply. People want to feel one, what are they, the cliche of nobody cares what you think unless they know you care, right? That's what the technology is for at Parker Gale and how we do things. We're using the machine to connect more deeply to people, not using the machine to connect to more people.

1:04:18Ken Fine: I'm not trying to connect with people. I want to develop deep relationships with people and have them trust me enough to let me back them. Let me buy them, have them have me invest money for them. And I think this is what the, these things are able to do. And, you know, maybe it's just cause I'm a hokey art history major who grew up with hippie parents in the seventies. So. I think the irony, I'll end on this, Devin, is that well executed, I think this technology will actually enable us to be more human and have more substantial quality relationships with people. Yeah, because think of those hours my associates were updating the CRM.

1:05:02Ken Fine: They don't have to do that anymore. They can now spend those hours connecting with their peers at other firms and learning what they're doing, connecting with young employees at our portfolio companies that are going to be the future CEOs that we want to back someday, connecting with alumni from their universities who are also doing cool things and being out in the world and, as the kids would say, touch grass. So I think that has not been what has been happening in the last couple of years. People are using the machine to accelerate outreach, electronic outreach, not to differentiate themselves.

1:05:38In a world where we're selling money, that's all we do.

1:05:43Ken Fine: We sell money. Highly undifferentiated. Every private equity firm thinks they've got some special sauce, some special unique approach. this graph you talk about, this visual graph of basically saying, hey, Devin, you're not that important and you actually don't know as many people as you should given the benchmark of where other people are. That would be hard to hear, but it could probably be true. That's going to tell people like, no, no, no. Nobody knows who you are. Oh, you manage billions of dollars and you've got everything you can imagine and you've done great for your investors and your portfolio companies, management teams like you.

1:06:17Ken Fine: That's okay. That next owner of the next company you want to buy has never heard of you until he hires William Blair and William Blair puts you on a target list. Then he's like, oh, Parker Gale. I've never heard of those guys. That's the biggest whiff in the history of our industry would be that they are running their business. They're heads down thinking about their business. You're not sitting down every day, Ken, thinking about what private equity people do I need to know? I wonder if they like CRM. You're like, no, you've got the weight of 3 ,000 customers on your shoulders and you've got to thread this needle of agentic AI in a system of record business, you're not looking up every day thinking about what private equity firm partner you need to get to know, but they should be thinking about how they get to know you and approaching you in a way that you're like, wow, I am taking that call.

1:07:08Ken Fine: And when they do, I do. Yeah, totally. This is what we do with our CEOs. I know we're getting a little off topic here, but I think there's good stuff at the end is, yeah, we tell our CEOs, hey, we tell private equity firms and our CEOs, if a private equity firm calls you, and they do all the time because they're sourcing other private equity-owned businesses, take the call. And they're going to say, we have a thesis in this space. We know Parker Gale really well. We've got a great relationship. Here's what we think. And that starts the process of who we're going to sell the business to. Because somebody's going to tell you, oh, I know a lot about supply chain.

1:07:42Ken Fine: and they're going to tell, and then they're going to say, oh, I can help you with this, help you with that. Okay. Let's, we're going to own this business for the next five years. Let's see who actually helps you with supply chain and gives you some insight into it. Right. Cause that first phone call is easy to say like, oh, we got a thesis here. We got this. Okay. Let's find out. And so few people actually follow up on that. So it's so transactional. It's like, oh, they're not for sale right now. Let me move on. And that's the venture side of flipping that sourcing triangle upside down where private equity spends all their time at that top layer of what's for sale and what's about to be for sale.

1:08:18Ken Fine: Venture is completely flipped. Who's every human in my area of expertise I need to know who I might want to back to start a company? If private equity had that mentality of like, who's every human I need to know where I might want to own their company and give first to receive later, I think, again, you can use the machine to do that way better. Hey, so this is a lightning round question, Ken. We usually ask our guests what's something they would bet their bonus or their equity on, something that they're certain of in the next 12 or 18 months. And then a twist on that question, if you want to take it a different direction, would be something that you believe that maybe other people around you aren't quite so sure of yet.

1:09:00What I believe for this discussion today is that the way AI will be used in our world is going to move up the stack almost if you're like a Maslow's hierarchy metaphor. And it's going to move from where it started, which is automate things and save me time. So there's a value proposition of time savings there. And when we sit here a year from now, what we will see is one of the top use cases of AI will be, how do I create and then leverage the relationship asset that I have as an investment professional? And today that's not on the radar of many. And I think we'll start to take for granted as we progress through, all right, I've automated this workflow, I've automated workflow B and C and G and H, and everyone can do that relatively well.

1:09:52Very hard to differentiate that way. Now, how do I actually, in the language of the space, create alpha, find better opportunities, exit them more successfully. And the secret sauce there is relationship. It's really your relationships more than the brand of your firm. It's who are you and who do you know? And I think we'll see AI playing a paradoxically powerful role there. When I say paradoxically, it's ultimately a very human thing that will be enabled to do it better through technology.

1:10:18Ken Fine: I totally agree. In a world of beta, where it's unclear whether or not you were lucky or good in a big bull market we've just had, alpha will come from relationships because you'll find something that somebody else hasn't seen yet. You'll know something that somebody else doesn't know yet, or you'll have a skill that somebody really needs and you don't know it that they need it until you meet them and talk to them about it. I agree. Well, thank you for doing this and thank you for supporting our company and our goal would be using technology to be more human and present in the private equity industry.

1:10:52Ken Fine: So I appreciate it. Likewise. Thank you for your partnership. Bye for now.