Ep. 147: Mike Esposito, Franchise Equity Partners | Box Economics and Multi-Unit Franchise Investing

0:00Hey, everybody.

0:01Mike Esposito: Before we get started with today's episode, I want to take an opportunity to tell you about my new book, AI Marketing Blueprint. It just hit number one bestseller status across multiple categories on Amazon, and it walks you through a proven framework that we are taking our clients through here at How to SaaS and how to stay relevant and visible in a world with AI platforms. One of the biggest problems that we have seen across clients and companies is that the traditional channels that they relied on, like paid search or SEO, have declined significantly or are getting more expensive and competitive.

0:34Mike Esposito: The reason for this is that a lot of buyers are starting to self-educate themselves and research on AI platforms. So a lot of that volume that was previously going to those channels is now moving to these new AI platforms. So to stay relevant, the book walks you through seven new rules that companies in all kinds of verticals and industries need to consider so that they can continue growing their pipeline and revenue and ultimately their enterprise value. So if this applies to your business or one of the companies that you've invested in, I definitely recommend that you pick up a copy. It's available on Amazon, on Apple Books, on Barnes and Noble, and even share it with your teams.

1:10Mike Esposito: Grab a bunch of copies so that you can kind of consume the content together and start to apply it to your business. And with that said, let's move on to the episode. Welcome to the Private Equity Value Creation Podcast, where we interview leading investors, operators, bankers, and advisors to help you answer one question. How do we increase the enterprise value of our companies? My name is Shiv Narayanan, and each episode, I will dive deep with a guest to help you become a better value creator and capital allocator. So with that said, let's jump right in and let's get started with today's episode.

1:46Mike Esposito: My guest today is Mike Esposito, and he is the co-managing partner at Franchise Equity Partners. And what I really enjoyed about this conversation is that Franchise Equity invests in companies that are more legacy businesses or offline businesses that have local presence and often they're franchises. And Mike and I dove deep in terms of how they actually evaluate these types of companies, how they look at their cash flows, how they look at their business model, and how they decide to invest. And ultimately, how do they create enterprise value in these companies? Because the approach for growing these businesses and generating a return from those investments is quite different from, let's say, a traditional private equity firm that's deploying capital into technology or tech-enabled services.

2:28Mike Esposito: And Mike brought some really great insights in terms of how they look at these companies and what types of metrics they use to evaluate them and what their overall approach and philosophy is. And I think even though it's not directly related to, let's say, technology investing or the type of firm that you might be investing in, there are a lot of great takeaways because there are parallels in terms of how they're growing their companies here versus how you might want to do it for your investments and your portfolio. So I hope you take away from it as much as I do. With that said, I'll leave you to it.

2:56Mike Esposito: Enjoy the episode.

3:04Mike Esposito: All right, Mike, welcome to the show. How's it going? Great. Excited to have you on. So why don't we start with your background and franchise equity, and then let's go from there. Sure. Well, first off, thanks a lot for having me. Really appreciate it. I'm sitting here in New York today, which is where we're headquartered. So I'm Mike Esposito. I'm one of the co-founders and co-managing partners of Franchise Equity Partners. We launched in 2021. Prior to that, I was at Goldman Sachs for almost 30 years as an investment banker in the financial services area. I ran the Global Financial Institutions Group.

3:44While at Goldman, I had a little side hustle, which is I owned a bunch of Jersey Mike stores, and it kind of opened my eyes up to franchising. and kind of paved the way for Franchise Equity Partners. So we focus on multi-unit retail investing, typically as a franchisee, and we focus on five verticals, restaurants, automotive dealerships, beverage distributors, heavy equipment dealers, and other consumer business services. As I said, we launched in 2021. We were about$2 billion of assets under management. We've been backed by HPS Investment Partners, which is a subsidiary of BlackRock. And at this point, we've got about 2 ,000 storefronts across the various verticals I mentioned.

4:32Mike Esposito: Yeah, it's interesting because a lot of investors that come on the podcast are more focused on technology or tech-enabled services. And this is different, right? So walk us through your investment philosophy. Like, what types of assets? I get the franchises, but give us some more details. Like what stage of business are they in? Is it geographically focused? Like help us understand that. Yeah, let me just back. I will answer that. Let me just back up because you hit on something that kind of we found to be really interesting about this whole sector is that there's a lot less organized private equity competition across these different verticals, particularly across the franchisee investing universe.

5:12We do see some competition in restaurants, but we don't really see anybody playing across the space. And I think there's a couple of reasons for that. First and foremost, private equity people don't like to have to give up control or power to brands. And at the end of the day, as a franchisee, you're not the brand owner. And you've got to be comfortable with that, that somebody else is controlling a playbook and controlling how to develop a brand. I also think that in a lot of these situations, they're family-owned businesses. And so family-owned businesses oftentimes have some nervous dealing about private equity also.

5:54We try to look like a family office. We can invest for a very long period of time. We can invest as a passive investor, as a minority investor. and we really tried to set up our capital, be very differentiated relative to typical private equity. That's worked for the families, but importantly, it's also worked for brand owners. And so we've gotten into a bunch of systems where there's no private equity. And it's like in the auto dealer world, in beer distribution, there's no private equity. There's very little in heavy equipment dealing and we've been able to get into all three verticals. So I think there isn't a lot of competition And that is definitely one of the reasons that we like it quite a bit.

6:37Mike Esposito: Yeah, just to touch on that, I think it's an interesting angle, right? Because one of the things a lot of firms struggle with is deal flow and really distinguishing themselves. And at the same time, there's so many middle market firms that chase the same assets. And meanwhile, there's all of these companies. He's like, I have a bunch of entrepreneur friends and people that run businesses that are not a private equity focused type of industry, but they're good businesses. They're profitable and there's modest growth and they're just good businesses to own and run. And yet institutional capital doesn't always back those kinds of companies.

7:13Mike Esposito: And so I can see that being a bit of a blue ocean for you guys. Yeah, no, absolutely. We've definitely found it that way. As I said, there's not much competition in it. And they're big industries. They're consolidating industries. For us, we found it to be a bit of a different return profile. As you said, a lot of people are focused, a lot of investors, institutional investors are focused on tech. Clearly, there's been this AI boom that's happening, which has drawn a lot of investment capital. We're definitely old economy businesses in a way. We're brick and mortar businesses. We like to say that we're the businesses that Amazon hasn't been able to get to.

7:59So you have to go to a gym to work out. These people still want to go to a car dealership to see their automobile. You have to get your taco from a local taco place. And so there's good reasons why these businesses exist, but they've been a little bit undisruptible. And we like that. And they tend to be economic resilient, and they tend to have very good cash on cash returns, which is nothing we liked about them. So, you know, a lot of things you see transacting in private equity, you know, can often times trade in the 10, 15, 20 times EBITDA level, particularly where there's this Russia capital into it.

8:41And we still see that in the things we transact in. We're sub 10 times. And as a result, they have a very good, sustainable cash on cash return. Yeah.

8:51Mike Esposito: Yeah. I think that's a powerful differentiator, especially like when you're thinking about value creation and growing these investments over time. But help us understand the profile a little bit more. So I get the model. What characteristics do these businesses need to have for you to consider them worthy of investment? Yeah. So we kind of have probably a two or three tier filtering screen for us. As you pointed out, we've got a niche strategy. So one good thing on that is that every day we come in the office, every day we go out and hunt for something, we know very clearly what we're looking for.

9:31And people in the market also know for these types of assets where to come. And so that focus has really helped us quite a bit. And so we see a huge amount of deal flow. When it comes to traditional multi-unit retail, we have this multi-tier filter. So I think it starts with the category and brand. So I'll speak about this in the context of food, but it's applicable to anything else, whether it be auto model of aftermarket, whether it be gym space, whether it be early education, all of which we're in. And I'll speak about that in terms of food. So we start with the brand. And brand matters a lot when you're a franchisee.

10:14You're a taker of the model. You're a taker of the brand. And so you want to find a brand that's got good momentum where we can partner with the brand. And we spend a lot of time not only studying the brand, but then getting to know the senior leadership from the brand. And, you know, we really want to try to find systems where they're looking for partners. When it comes to brand momentum, you know, we're looking for things that generally have decent AUV growth, meaning unit volume growth. So it kind of starts at that level. You know, ideally, we're looking for things that are unique, that are differentiated, whether it be the food, whether it be the service model, whether it be some of the optimization of how they actually produce things.

11:04So, you know, it starts with the brand. It starts with the quality operation, the growth, and then the partnership mentality. And then we look at box economics. And for box economics, you know, we're looking at things, again, like AUV growth, but we're looking at margin structure. You know, one of the things that's really difficult in multi-unit retail, particularly in the franchisee space, is that a lot of times margins are really thin. And we are very sensitive to margin because at the end of the day, margin is what allows you to survive shocks. For us, we're generally looking for things at the store level that have margins in excess of 15 % and ideally north of 20%.

11:48And a lot of concepts, probably 80 % of the concepts get cut off right there because they don't have that.

11:55Mike Esposito: Can you expand on the box economics and the UV growth side? Just help us understand, like, how are you evaluating these franchises? I get the margin component. I get that, you know, on a per unit basis, how much are they moving in terms of revenue and what's their gross margin, their overhead and all of that. But what are some benchmarks that you're looking for within those types of metrics? Yeah. So, you know, so when you think about the margin, there's several components to it. You know, many, many categories, but I'd say maybe the three to spend some time on. And again, I'll talk about this from the food concept, the quick service restaurant concept.

12:33You know, first is obviously food cost. And that gets coupled with labor. And generally the two of those together, we're ideally looking for things that have a 50 % or so relative to revenue. So 50 % cost of labor and food costs. Now food costs can be volatile. So if you look at what's going on right now, meat and burger and beef prices have skyrocketed. 18 months ago that was chicken. And so you have to think a lot about end commodity risks that you're taking. You know, one of the great things about Taco Bell is that there's actually not a lot of protein, whether it be chicken, beef, in the taco.

13:20And it's a lot of filler, which is a lot less volatile in terms of cost. And so Taco Bell is one of those systems that has a circa 50 % prime cost, i.e. labor or food. But also importantly, it's not as exposed to the commodity cycle. So that makes that from a box economic standpoint really attractive. And then beyond those two costs, food and labor, we're looking at the all other, I would say the biggest driver there is rent. And that's the other key is that in part, it's how efficiently can you take a big unit volume down to the bottom line? Part of that is food and labor, but then box format matters a lot.

14:04So standalone stores are expensive. Inline stores are cheap. And so to the extent we can find systems that have very good unit volume that can be done in an inline format, that makes things very attractive. You know, in today's markets, some names that come to mind that have that kind of very attractive situation is something like a Dave's Hot Chicken. So even Wingstop today, which has had some issues in the last four or five quarters, very good box economics because, again, it's in line. Jersey Mike's would be another one that fits that mode. So when we think about box economics, those are some of the key things that we're looking at in terms of profitability measures.

14:47Mike Esposito: So basically what you're saying is that like, you know, there's commodity impact on the cost of food and then there's the actual rent and the overhead that goes along with maintaining the location. And so certain locations, if they take up less square footage, like there's a metric revenue per square foot. I'm sure you guys look at that, right? On a revenue per square foot basis, if you have like an inline store versus a standalone store, like it's just more efficient. You're moving more product, you're moving more revenue, and you're able to be way more efficient with your operations. Yeah. So I think there's always a bit of a tension between franchisee and franchisor.

15:24Franchisors don't have to live directly with the cost of a build and say, look upon a standalone store as branded. McDonald's is probably the best example of this. but it's maybe not the most efficient way in terms of if you want to grow stores quickly and have good returns on the stores, oftentimes an inline concept is better. It's a trade-off, no doubt about it. Stand-alone stores do attract more attention, so probably in general, stand-alone stores have better AUVs. I think where it gets interesting and it matters a lot is in concepts that are driven by the need of a bigger box. if you look at what's going on in coffee now, this is a great example in what Dutch Brothers and Seven Brewer are doing.

16:15They've actually got standalone stores. The stores themselves are tiny, but it's all driven by speed of service. It's like the key threshold for them, get people in and out through the line in three and a half minutes. And they have got big pads, but it facilitates the double drive-through bottle. So the point I'm trying to make there is that You know, from where we sit, we like the best return on investment as possible. In certain instances, the bigger footprint is necessary to facilitate a high fruit button model, which creates a lot of value.

16:52Mike Esposito: We'll get back to the show in just a moment. But before we do, one of the most common and important value creation levers that we hear about on the show from private equity investors and our own PE partners is go to market. yet when these same PE partners bring us into their portfolio companies or new target investments that they're exploring we find that the marketing function is quite immature underutilized and under optimized and so that's a huge opportunity that we see inside these companies and if you have a portfolio company that you feel like it's scale a lot faster to drive more pipeline and revenue or you're looking at a new investment where you feel like that could be core to your investment thesis well we'd love to explore that with you and figure out how we can partner with you to drive more enterprise value creation on the marketing side similar to the way that we've done with major PE firms like TA, Updata, HG, SDG and many more.

17:44Mike Esposito: At this point we've done hundreds of engagements across hundreds of industries and verticals and we have a ton of benchmarks and frameworks that we bring to these engagements to help you drive as much enterprise value as quickly as possible. So if that sounds like something that you might be interested in, you can just email me directly at shiv at howtosass.com or go to our website and schedule a demo and we'd love to speak with you about it further. And now with that said, let's get back to the show. Something that jumps out to me is that because you're investing in so many different types of franchises like Quickserve and you have automotive and beverage and equipment, Like you guys, your investments are susceptible to what's happening in commodities markets, what's happening in supply chains.

18:31Mike Esposito: And so there's just a lot of moving parts versus, let's say, a tech business or an investor just puts money into software companies. Like, really, you're just looking at the software code and whether that's legit and how it maps against competitors. So it feels like way more complexity to invest in these kinds of businesses. Or am I wrong? I'm curious, like, your take on that. Well, there's certainly, yeah, nothing's free in the world and there's a risk in everything one does. But, oh my God, I like every day I could go and I can see the cash and the cash register in the things we invest in. These are cash flow businesses.

19:04There's no uncertainty. Given what's gone in tech, you look at what's happened in the whole software market and disruption is being caused by AI. Whatever they had in terms of EBITDA is surely shrinking every day. And even when you look at the purest tech-oriented growth investing, how many of those businesses in their first five years actually generate cash flow? So we kind of like it. Yes, there's clearly risks. We've already hit on a number of them. The thing that we think a lot about is over the last 20 years, barriers to entry in these industries have come down dramatically. You know, it used to be you had a handful of choices in the food space.

19:49You know, you had McDonald's and Burger King. In the gym space, you had a bunch of people, but it was really Planet Fitness. And, you know, what we're seeing is that the emergence of all these new competitors and there's a lot of liquidity in the private financing markets, both debt and equity, have financed those. And a lot of people have made money doing that. And so, you know, there are new entrants. And to me, that's one of the bigger risks in everything we do. But at the same time, you've got a lot of visibility in the cash flow nature of these businesses that gives us comfort.

20:21Mike Esposito: Yeah, that's a great point, which is that these businesses by default are churning out more cash than a tech business that constantly requires reinvestment. You kind of have to balance the investment in that. I guess the other complexity would be things like CapEx or construction costs and other physical assets that you have to invest into. And so I'm just curious, when you're deploying capital, how are you evaluating? Because you have to forecast out three to five years out, how will this industry change or how will certain dynamics in the market affect this particular line of business? How are you evaluating all of that risk and additional capital expenditures and things like that that you'll have to put into it?

21:08Yeah. So one of the things we do is a lot of forward real estate development. And I like to say we occupy this world. We FEP occupy this world between traditional private equity and traditional real estate private equity in that we end up building a lot of stores. You know, if you go back to the top of the discussion, AUV growth matters a lot. We find AUV growth to be very hard to predict. And over a long time, over the last 20 years, if you look at it in restaurants, AUV growth is average less than inflation. And so generally speaking, in any of these multi-unit retail concepts, we are loathe to forecast same-store sales growth for any extended period of time at anything greater than inflation.

21:58And so in order for us to get our returns, we've been getting a lot of it from new store growth. And so we focus a lot on new unit development and the returns associated with that. And we've done five or six deals. We've gotten into seven brew coffee system. We bought 50 stores. We're developing 250. In Valvoline, we bought 40 stores. We're developing 75. We recently got into the Primrose nursery school system. We bought three stores. We're developing 18. We just announced a deal in Australia in Planet Fitness where we bought the master franchise rights to Australia. We bought 30 clubs. We're building over 70.

22:41So we're doing a lot of this. So first off, we've got a data science team. And the data science team has built white space models in all these different concepts. And they're dynamic models. And what we've observed is you can look at AUV today, but AUV degrades over time as systems build out their footprint. That's in part due to cannibalization. It's in part with themselves. In other words, if I put a plan of fitness here and then I put one five minutes, five miles further away, I'm going to degrade, cannibalize myself. But economics 101, if it's a good concept, somebody else is going to also build one close.

23:27And so you've got the cannibalization of those, in fact, both yourself as well as new competitors coming to market. it. You've got oftentimes brands start with the best places, best cities, best metros, best DMAs, and they move into tertiary, secondary, tertiary. So that degrades AUV all the time. And then there are vicissitudes, the brands. And so, you know, we've spent a lot of time thinking about all of those things, modeling all those things. And so we'll take on these three to five year development deals. But we go in eyes wide open about all the different things. We try to quantify it as best as possible.

24:06In order to cover our risk, we do this where we can get a 20 % unlevered return or better. And so, you know, in really simple terms, you know, simplest way to think about it is EBITDA after some EBITDA at the store, less than corporate overhead, divided by your all-in construction costs, we're looking for a 20 % plus unlevered return on that. And we felt like if we can get that 20 % unlevered return, that we can pretty much cover our risk for all the things I mentioned before. And we've been getting that in most of the places where we've been developing.

24:42Mike Esposito: Got it. Yeah, that's really interesting. I guess on the real estate side, is that considered part of the same fund or is that like a separate part of the business that you're investing into the real estate behind these franchises? So it's all part of the same fund. And every system and every concept is different. So a little bit what you're asking is, do we own the real estate or not? So first and foremost, we always want to maximize the value of the operating business. And we find that having the right location trumps everything. So in certain concepts that need to be on main and main, food would certainly be this.

25:21Generally speaking, it's very hard to buy the dirt and own the ground and own the buildings. Those properties oftentimes have been in families, local families for generations, and we found that we end up having to lease the site. In other instances where you don't need to necessarily be on main and main, we've had a lot of success in buying sites and developing ground up and doing it all ourselves. Certainly in the Primrose nursery school system, early education system, it's a good example where you want to be close to the retail cores, but you don't need to be absolutely in the retail cores. And so that's an area where we've been able to buy more of the sites ourselves and develop around that.

26:03Mike Esposito: Yeah, that makes a lot of sense. How do you look at innovation in these spaces? Like, for example, in in quick serve, you know, there's an innovation or a lot of talk about restaurants that don't actually have any labor. Like down the road, you'll just kind of walk up to a robotic counter and it kind of serves you food. Like, how do you look at those types of innovations and how it impacts your franchise or your plans to actually evolve these franchises over time? Yeah. So, you know, innovation is rampant and everything like we're in consumer businesses. And when you look at the last 25 years of these consumer businesses, it's been all about innovation.

26:43I'm sure it was true 30, 50 years ago, but certainly the last 20, 25 years, it's been absolutely true. And innovation comes in many, many different forms. When you first mentioned innovation, the first thing my mind goes to is food innovation. So, for example, Taco Bell is probably the best of this. literally every month they have a limited time, a new limited time offer coming out. Yeah. One month it's Mexican pizza. The next month it's some drink thing. And they've got a lab that's testing this, not just coming up with quirky recipes, but they're consumer testing it. And they've got a real forward calendar.

27:26If you look, it's happening in a beverage space between Swig and Seven Brew and Dutch. you know they're all really reimagining the whole beverage experience um it's not a it's not your your mama's starbucks it's uh it's really much more than espresso it's energy it's a energy it's an espresso coffee-based platform it's an energy platform it's a fizzy drink um dirty soda platform it's almost like an ice cream parlor platform so i think like it's when i think about I think it starts there. And I think the concepts that have done well are able to innovate successfully, but doing it in a way that doesn't deter from the customer experience in terms of getting through the lines.

28:12But then you bring up, you know, other kinds of technology. You know, clearly the app was obviously a big one and third party delivery was certainly a really, really big one. You know, what you're talking about now in terms of automating, I think is coming. You know, the in-store piece, people are looking at that and certain concepts like mixing salads have worked well from a robotic perspective. But I think you'll see more of that. I mean, I think the one disruptive concept out there that's kind of scary is wonder, you know, where they're really become a brand agnostic ghost kitchen with huge amounts of robotics.

28:54And if they can pull that off, that could be the most disruptive thing we could see because, you know, that when you again, when you think about that P &L is going through before you've you've eliminated labor, you've eliminated the need to be on main and main. So your rent is going to be super cheap. And so they're really dealing with some of the most expensive pinch points in making food. So I think that's, to me, the most disruptive thing I can see in food coming out.

29:23Mike Esposito: Yeah. Yeah. When you think about these companies, I guess there's obviously the innovation side and then there's the optimization and the financial engineering side. What about organic growth? Do you guys support these businesses in terms of actually growing their footprint or how much they're driving in terms of sales? Yeah. So as I said earlier, we tend to, not exclusively, but we tend to be franchisees. And there are certain brands where they basically handle all the marketing. And so if you think about the big, well-known food brands, they're basically doing that. As a franchisee, your responsibility from a marketing standpoint tends to be grassroots types of things.

30:06You're responsible for the Little League team. You give away some coupons in the local neighborhood, whatever it might be. But the branding itself, digital, social, national brand advertising, it's all done for brand love. In other systems, that work falls on the franchisees. So, for example, we own a business in the Precision Garage Door System, which is a residential services system. It's owned by a company called Neighborly, which is owned by KKR. And we happen to be the largest franchisee in that business. And we're the largest repairer of garage doors in the country. In that business, we're responsible for 95 % of the marketing.

30:50So, we've got a chief marketing officer. We've got all kinds of branded strategies, pay-per-click and digital strategies within Google and other platforms. We're coming up with our own marketing campaigns. We're constantly testing and looking at that. And so it varies widely in terms of that spectrum, in terms of what we're in today.

31:16Mike Esposito: Yeah, one of the things that we've noticed because there's tech companies that are more savvy in modern ways of driving demand and pipeline. And a lot of these offline businesses don't even do the basic fundamentals of having a local presence or local SEO or local paid media and things like that. And they seem like very accessible and quick value creation levers that can be pulled. And so I'm curious if you see that, especially in all these kinds of industries like manufacturing or offline, not just quick serve. Like quick serve, obviously, there's a whole playbook around these apps where you can order food online and things like that.

31:56Mike Esposito: But I feel like just these legacy businesses, they've never done some of the foundational or basic campaigns that you can run to drive more pipeline. Yeah. I mean, I think some of that, to be frank, is in this middle market. Part of what we didn't talk about, I didn't mention it, we're distinctly a middle market investor. So companies we look at probably are averaging 10 to 50 million of EBITDA. And to generalize, in that space, there's probably less data sophistication. We like to say they're pre-moneyball industries. And so what we found is bringing data and data analytics into this can help immensely.

32:38You know, we bought not too long ago the largest car wash platform in the world in terms of operations in Europe. It's called IMO. This happens to be a company-owned model. And they didn't have a data lake for anything. So we started by building a new ERP system, a new data lake. They literally, for a business that was generating 50 million of EBITDA, they spent$1 million on advertising. There was no chief marketing officer. There was no chief technology officer. So we're reinventing the whole data stack from all the way at the ingestion of data, all the way through the customer experience through the app.

33:29We're redoing the whole data stack as part of that, creating the data light to get information, and then completely changing the pricing product and marketing strategy. And some of that was because we've had some experience around these concepts. We've been able to bring it. Obviously, a lot of this is we hire the right people to bring it bear to these things. And so we feel like in that middle market, it's just really right for data, moneyball-type tactics, and bringing some of these best practices into these companies.

34:03Mike Esposito: Yeah, I think that's a huge untapped area because most of the competition in these markets are not thinking about these things. Like, for example, like even on things like Uber Eats or on these food ordering platforms, there's ads platforms in there and a lot of food vendors don't leverage those. That's a basic optimization to drive more pipeline. And the same can be said for localized SEO on Google Maps. If you have a local business and a lot of companies don't even show up on those types of applications. So I think the value creation levers are just way more accessible, whereas if you are in a more advanced market where everybody's kind of doing the foundational stuff, then to be competitive, you have to do much more.

34:50Mike Esposito: So I feel like that's a big lever inside these businesses. Yeah. I mean, we've got, as I mentioned, this data science team. So one of the things we do when we get into these businesses is we try to get as much reads on how they're dealing with their estate of marketing. and um so one of the things we do is we scrape you know simply it's just scrape the google business profiles really simple way just to audit how companies are doing and in some of these businesses we look at like with hundreds of stores there's no consistency hours differ there's no phone number for the store they don't link in the google reviews it's it's bad uh and so uh you're right.

35:33I think there's like a lot of opportunity to unlock value there.

35:37Mike Esposito: Yeah. Yeah. A hundred percent. Um, we're coming up on time here, Mike, but before we close off, if people want to learn more about you or get in touch with you, what's the best way for them to do that? Yeah. So, uh, you know, feel free to email me, uh, Mike.esposito at FEP-us.com. I'm happy to chat with anyone. Awesome. We'll be sure to include that and your website and the show notes. And with that said, Mike, thanks for coming on and sharing your wisdom. I, it's a bit of a change of pace for the podcast to hear from someone investing in these types of businesses. And I think there's a lot of great takeaways for all kinds of companies.

36:09Mike Esposito: So appreciate you coming on and sharing all that. Thank you. Thanks for listening to today's episode. Before you take off, just a few requests from our side. Number one, if you haven't done so already, please subscribe to the podcast on iTunes or Spotify or YouTube or wherever you go to listen to your podcasts. Number two, if you are in the market for due diligence services, strategy consulting or fractional CMO services, please get in touch with us at www.howtosass.com. And third, please buy a copy of my new book, Exit Ready Marketing. It covers a ton of concepts that we take our customers through, private equity investors, B2B companies, CEOs, operating partners and marketers.

36:53Mike Esposito: and there's a ton of great value in there that expands on my previous book, Post Acquisition Marketing as well. So with that said, I hope you enjoyed today's content and we'll see you on the next episode.