The Wise Exit

MAC LACKEY - Episode 41 of the Cashing Out (M&A) podcast

00:00:00:14 - 00:00:24:07
Mac Lackey
Everybody we work with, every entrepreneur are so smart and impressive and talented, and they're good at what they do. But what they haven't done and what they don't do is sell companies. And so just helping them lift their head up and kind of open the aperture to who would value what I've created, you know, not just in my industry, because the path of least resistance for so many is let me find a larger version of myself.

00:00:24:11 - 00:00:30:05
Mac Lackey
And the reality is the big opportunities are when people outside your industry are trying to break in.

00:00:30:07 - 00:00:56:17
Todd Sullivan
Welcome to the Cashing Out podcast, where our fellow founders share real stories and offer honest advice around selling their companies to some of the top acquirers in the world. My name is Todd Sullivan, CEO of Exitwise, where we help business owners create the exits they deserve. Today, my guest is Mac Lackey, a serial entrepreneur who's built and sold six businesses with multiple eight figure exits to NBC Sports and News Corp, just to name a few.

00:00:56:19 - 00:01:28:18
Todd Sullivan
Mac has been featured on CNN, The Wall Street Journal, Fast Company, USA Today and The New York Times, and now spends his time working with business owners through his extraordinary program called Exit DNA, which helps grow businesses from tens of millions to hundreds of millions of dollars so they can be sold for maximum value. Mac and I not only talk about his insights to business growth and maximizing exits, but we also have some fun learning how he went from playing pro soccer out of college to buying a professional soccer team after selling his last business.

00:01:28:20 - 00:01:51:11
Todd Sullivan
I hope you enjoyed my conversation with Mac Lackey. Mac, thank you for being here. I am just fired up to be able to talk to you because our backgrounds are so similar. I feel like I did well in my entrepreneurial journey and you have just hit like the Grand slam of not only the number of exits, but the knowledge that you have acquired over time.

00:01:51:12 - 00:02:12:03
Todd Sullivan
And I know that, like your business ethos today is about giving back to founders. And that's where I live. You know, we're both kind of that semi professional professional athletes. Multiple exits. You had an apparel company owning about that. I had one as well. It was so clear to me when I got you to pick this time it was I bumped Mark Cuban in like 2 seconds.

00:02:12:05 - 00:02:16:07
Todd Sullivan
So this is your time slot and we are ready to go. So thank you for being here.

00:02:16:09 - 00:02:22:00
Mac Lackey
Thank you so much for having me. And I appreciate the kind words. And yeah, I'm excited to to chat with you.

00:02:22:02 - 00:02:34:23
Todd Sullivan
So, you know, I think the best place to start is just getting your background. What brought you to entrepreneurship? And then maybe we hear about some of the exits that you had and the learnings and try to give it great advice.

00:02:35:01 - 00:02:58:09
Mac Lackey
Sure. So I think of my background really in two kind of big buckets. Much like yourself, you know, sports defined kind of my youth. So as a kid I started playing soccer at about four years old and just about every goal and dream I had was soccer related. That's all I felt about. I played every day I could and my goals were, I want to play in college.

00:02:58:09 - 00:03:17:00
Mac Lackey
I want to be a collegiate all-American. I want to play professionally. I didn't even know what that meant. That was just the highest level I could imagine. And so most of my life was focused on that. And thankfully, I was able to check off some of the boxes along the way. And soccer meant a lot to me then, and it still does today.

00:03:17:02 - 00:03:35:23
Mac Lackey
But once I stopped playing soccer, I knew that the professional journey was over for me because of my age. You know, MLS didn't exist yet. There wasn't really an opportunity to go to Europe like there is today. I'm jealous of kids today, but I went from kind of playing soccer to what am I going to do with my life?

00:03:36:01 - 00:04:06:21
Mac Lackey
And I was a psychology major. I had never taken a business class. I had never taken an entrepreneurship class. I had never taken a computer science class. But I met someone on the soccer field that was working for a small startup, and they needed help in their marketing department. And this was a hyper small startup. So I ended up taking this kind of entry level job for a startup, and within days I fell in love with the energy of you show up and you're doing something different every day.

00:04:06:21 - 00:04:29:03
Mac Lackey
You're learning something different every day. One day I was licking stamps. The next day I was learning to write code. I just kind of did it all. And the real powerful thing that happened there is I met an engineer and I really hit it off and we believed everything that was happening for this educational focused startup really should exist in the business world.

00:04:29:03 - 00:04:50:19
Mac Lackey
It was kind of early multimedia. The earliest of Internet kind of rumblings were starting to take place, and we thought, You know what? This has got to hit the business world in a big way. So I basically started my first company and the first quarter of 1995, we launched an Internet company right after Netscape launched kind of the commercial web browser.

00:04:50:21 - 00:05:10:17
Mac Lackey
And I often describe it to friends as I was too naive to know how crazy it was to have no experience and just start a company. But I had a lot of conviction around the Internet and what it was going to do and what it was going to change. And so that's kind of how I, you know, jumped with both feet into the entrepreneurial journey in early 95.

00:05:10:19 - 00:05:27:16
Todd Sullivan
Oh, that's awesome. I mean, so, so many parallels. This is certainly not about me. But, you know, when I was ten years old, I saw Jim Craig in the 1980 US win gold medal in Lake Placid. And when I saw that I hadn't played hockey before, I hadn't been on skates and I was like, I want to be that guy, right?

00:05:27:21 - 00:05:46:08
Todd Sullivan
And then everything, everything we did was about that. There was I came from a tennis family, too, so there's a little tennis in there. But, boy, it was just how far can you go in the Olympics was all I cared about. And like you started a company really, right in college, right around that 1995 is when I graduated.

00:05:46:10 - 00:06:00:06
Todd Sullivan
I started the first company. And man, so many similarity is I want to get into this. Let's dive into you. You decide like, Hey, I don't have any of this training, but I'm going to jump for it because you have a ton of conviction. And so how did that end up going?

00:06:00:07 - 00:06:21:18
Mac Lackey
So I would say, you know, my my first company on what ended up being a 26 year journey was different than a lot of the others for a couple of reasons. One is, you know, I didn't have a particular goal or vision around what I was building. I just was really excited and convicted about the space and I really wanted to learn.

00:06:21:18 - 00:06:46:08
Mac Lackey
And so I had a very smart, talented business partner who was an engineer, self-taught engineer, so kind of a unique animal. And we were, you know, basically building a garage startup as people describe them. Now, you know, I lived in a one bedroom apartment. I had no money. We had no investors. We basically had to sell something every month in order to pay the light bill of our little office in my little apartment.

00:06:46:10 - 00:07:10:07
Mac Lackey
And so the business started very slow. But because of the timing, the Internet was obviously putting wind at our back. And so we went from kind of a two person startup to having some Fortune 500 clients, you know, early Duke Energy, Bank of America. We built some of their first websites. We built some of their first Internet applications.

00:07:10:09 - 00:07:34:20
Mac Lackey
So this company kind of went from nothing to something very quickly and ended up in about 1998. All of the sudden, a lot of companies started reaching out to us proactively, which again is unique. I'm happy to talk about I've never had that experience again, but people were kind of knocking our door down saying, We want to buy your company, we want your clients, we want your engineers.

00:07:34:22 - 00:07:57:23
Mac Lackey
So we you know, I had my first eight figure exit in my kind of mid to late twenties, and it changed everything about my personal life. It certainly changed how I viewed business because looking back on it, it was an amazing outcome. Three years from kind of an idea to an eight figure exit, seeing how much value could be created.

00:07:58:01 - 00:08:13:06
Mac Lackey
It glossed over the fact that, you know, I slept on the floor in the office a lot, made a lot of peanut butter and jelly to make it work. But the outcome was so meaningful that it really changed my view of what I wanted to do the rest of my life. And so in hindsight, it all looked really good.

00:08:13:11 - 00:08:25:05
Todd Sullivan
So that exit got created by really inbound interest from buyers that already knew who you were or were you interacting with them, where they customers, how do they know about you?

00:08:25:07 - 00:08:54:00
Mac Lackey
So yeah, it was unusual because it was inbound and I really never experienced that again. And I'm a big believer in, you know, you have to create outcomes. They just kind of showed up. And the reason they showed up is because the space that we were operating in was getting really big. There were a lot of very well-funded companies pursuing this opportunity of working with large Fortune 500 companies, doing Internet development, doing applications.

00:08:54:02 - 00:09:21:14
Mac Lackey
And so we there were a couple of groups that were rolling up the space, some had already gone public. And so you could see the writing on the wall that you either needed to get out to one of these big groups that were acquiring a lot of smaller businesses, or you'd have to find a way to compete. And, you know, candidly, we got a couple offers that were all somewhat life changing and we just couldn't say no.

00:09:21:16 - 00:09:38:03
Mac Lackey
So, yeah, it was really an unusual set of circumstances. A lot of it was timing, of course, and that sort of created this outcome where we sold into a roll up. It subsequently went public and, you know, I watched that entire kind of process from the inside, which was really interesting.

00:09:38:03 - 00:09:57:05
Todd Sullivan
I love to dig in to that one. I agree with you that inbound offers to entrepreneurs, those don't work out, right. Those end up being kind of a waste of time. And in fact, they're not particularly genuine. It's a lot of times private equity firms that are looking for a needle in the haystack. It's their analyst calling, trying to make their numbers.

00:09:57:05 - 00:10:22:02
Todd Sullivan
And it really, you know, is a disservice to founders. It's not to say that some of them can't be real. We've had enormous transactions with inbound offers, but they typically come from a customer, somebody that you're already working with that really, really knows you when they come out of the blue. I really would caution our kind of fellow founders to not get distracted around what seems like it could be exciting.

00:10:22:04 - 00:10:51:00
Todd Sullivan
The second thing, right really around timing that you were open to it. I've been on these podcasts with founders that have said I need $100 million. That's when we're going to sell. But your awareness of kind of the macroeconomic environment, what is happening in your industry is so important for our founders, right? You might be building this amazing thing, but if the competition is all going over here, it makes a lot of sense to know what's going on your industry in order to make these kind of decisions.

00:10:51:00 - 00:11:03:08
Todd Sullivan
So I really applaud you. You you got on the ship at the right time, it sounds like. And that went public. Can you tell me a little bit the structure of that? Were you along for that financial ride when they went public?

00:11:03:12 - 00:11:28:06
Mac Lackey
I could not agree with you more because, you know, I almost in some ways don't like to even talk about my first exit simply for what you just said is it's unusual. And it worked out well. But every other experience I've had and I've seen has been so different that I'm such a big believer in you have to, you know, drive outcomes and to your point, you know, I'm not very good at many things.

00:11:28:06 - 00:11:54:02
Mac Lackey
But one thing looking back, I feel like I was always very aware of the factors outside of my core business, whether it was the performance of the business is one thing, but where is my industry? Where is the macroeconomic environment? Where are the other human constituencies around me and what's going on with them? And seeing and being open to, you know, those scenarios is really had a huge impact on subsequent outcomes.

00:11:54:02 - 00:12:15:20
Mac Lackey
So anyway, I just want to kind of hit that with a highlighter because I couldn't agree more. That particular company, it was a roll up where they I think they purchased about 25 companies around the world in an effort to take it public. I it was also an interesting situation in that my co-founder and I were very different places in our lives.

00:12:15:20 - 00:12:37:12
Mac Lackey
We were both similar ages. We were both, you know, somewhat newly married, but he was already going through a divorce where I was much more interested in the equity and participation and future of what this space could mean. He really needed cash. And so one of the things we found out really early on is we can agree to a path forward even if we have different outcomes.

00:12:37:12 - 00:12:58:16
Mac Lackey
So we structured the deal where he was able to take kind of more cash off the table as a co-founder, I took some cash and a fair amount of equity because I really believed in the thesis of the IPO. And so yes, I kind of participated all the way through the IPO. And then I actually resigned the day after the IPO to start my next company.

00:12:58:16 - 00:13:08:21
Mac Lackey
So for you, in some ways it was really perfect timing. I made plenty of mistakes as well with some of the proceeds, but I, I sort of resigned and started my next business right after one.

00:13:09:02 - 00:13:30:14
Todd Sullivan
Mac. That's awesome to bring up because I think a lot of founders, when they think of exiting their business, it feels very black and white. I'm going to sell and the day I sell it's over and I get some check when you can structure deals in a way that you know, lets you ride some of that upside, helps participate in the value creation going forward.

00:13:30:14 - 00:13:55:00
Todd Sullivan
That's one. But the other thing that you brought up is so important people that have co-founders, right, or just other people with equity interest, they're coming at it from a different angle and you can create outcomes that are different for each of those and of equity stakeholders. So it isn't black and white. I always tell founders what is the most ideal path going forward for you personally, and let's go out and create that path.

00:13:55:00 - 00:14:14:01
Todd Sullivan
There is a structure there for you and your co-founders to make that happen. So thanks for bringing that up. Like you have so many more experiences and I would just throw it to you given, you know, being respectful of your time, what do you think? Were there mistakes that you made in some of the other exits? I know you have a progression, right?

00:14:14:01 - 00:14:27:05
Todd Sullivan
You built a company cell, a company built. Can you just rinse and repeat? But maybe some of the biggest learnings or mistakes that you made or really success stories that you've had that others can learn from? Could you share some of that?

00:14:27:07 - 00:14:53:21
Mac Lackey
Yeah. I think one of the things I feel really fortunate because as you well know, for most entrepreneurs, you know, in X exits the biggest financial opportunity of their lives and the odds are somewhat stacked against an entrepreneur getting through the exit door and really maximizing value. And so one of the real benefits for me is I had six exits, which allowed me to make a lot of mistakes in over, you know, the body of work.

00:14:53:23 - 00:15:27:04
Mac Lackey
It was okay if it was just my first exit or my second exit, you know, it really would have hurt because I would have look back knowing I left millions of dollars on the table because of bad structural decisions, bad personal decisions. So, you know, a few of the things that I learned along the way, you know, probably the biggest in terms of structure was I multiple times tried to structure performance oriented deals, you know, earnout that I thought, you know, the mistake I made last time, I'm correcting it this time.

00:15:27:04 - 00:15:55:07
Mac Lackey
And I kept turning the dial, really trying to get the structure right, even to, you know, what ended up being my fifth exit. I literally had it myself on the back and was like, You finally nailed it. You came up with the perfect structure and the irony. It was really interesting. Five days after we closed the deal, the buyer moved me from the group I was running to the M&A team, and so I no longer controlled the group that drove the earnout.

00:15:55:07 - 00:16:26:08
Mac Lackey
And so and they were perfectly within the rights doing that. I don't even know that it was disingenuous. They just thought maybe Mac has more value on this team than the team he was running, But it just literally took every opportunity of me pushing the earnout that I wanted. And so I'm a big believer now in, you know, guaranteed cash is the only number that mattered to me, you know, So if I had a performance deal or earnout or anything else in the future, I would consider that upside.

00:16:26:08 - 00:16:52:20
Mac Lackey
I would look at it. But the guaranteed cash, cash close and contractually guaranteed payment streams were really the only ones that I heavily focused on. And when I finally got that right in my my final exits, it made a huge difference. And I know there are ways to structure earn outs. I know, you know, you you've probably advised clients through ones that really create a great second opportunity or long series of opportunities.

00:16:52:22 - 00:16:59:05
Mac Lackey
I personally have whiffed on that multiple times and so I am generally a fan of Guaranteed.

00:16:59:10 - 00:17:29:08
Todd Sullivan
So I love it, right? I've made the same mistakes and when you see those mistakes, you can correct, I would hope. And what I would say is the main point of the cash at close has to be enough. Everything should be considered gravy after that when you're making that decision. But you know, we have when we bring our kind of M&A dream team to every founder, how to structure a deal with a very specific buyer is really important and it really is about levers.

00:17:29:14 - 00:17:46:20
Todd Sullivan
I sold a business where not only did I get cash at close, but I was going to get paid based on traffic to a website. And I was a great you know, I talked to my tech team, Hey guys, this is going to continue to grow at this pace. We won't get too aggressive. Yup, yup. No problem. It's all going to be there.

00:17:46:20 - 00:18:02:11
Todd Sullivan
It's going to grow. And we're like, Yes, great. We're going to get all of these payments and as soon as we get over there, what do they do? They replatforming the entire website. We lose all the SEO traffic well within their rights to do that. Right. But they had other interests that they weren't, you know, letting us know about.

00:18:02:17 - 00:18:27:13
Todd Sullivan
And so all of that earnout goes away. And I think, you know what we've ended up doing is structuring for our founders ways where all the levers have to stay in your hands or we won't agree to it. And we have some great examples of how that has worked. Two in particular, I think are live right now. And we can see if if you have real alignment with the buyer and you're creating value together, you can control some of the levers.

00:18:27:13 - 00:18:33:03
Todd Sullivan
Not all, but yeah, awesome point. Anything else that you can think of?

00:18:33:05 - 00:18:50:02
Mac Lackey
Yeah. I mean I guess a couple other just kind of quick things I would say, you know, I wrote a e-book that's now free. I used to sell it, happy to put a link out there. Anybody this listing. But, you know, four things that I really learned along the way that I think really changed the way I did deals and created value.

00:18:50:02 - 00:19:15:00
Mac Lackey
But one real valuable lesson I learned is that you know, sometimes there is that kind of guaranteed cash payment, but there's also other things that can be incredibly valuable to you. And for me, going from kind of company to company, I was always looking at what enables the next business opportunity for me. Do I have capital from this asset that can help fund it?

00:19:15:02 - 00:19:34:06
Mac Lackey
But in one of my last exits, this company was doing a lot of international travel. And after we'd agreed to all of the financial kind of terms of the deal, I realized that that I would be missing out on some of the travel that was baked into the business that that we were running together. And I said, you know what?

00:19:34:08 - 00:19:57:19
Mac Lackey
I really would like to have that continue. And so I kind of negotiated this five year opportunity where I continued to get the leverage on the cheap travel. They had access to the insights, they had access to the tickets and things. That would be certainly something I could pay for personally. But the likelihood of me doing those things in the future, of course, would go down.

00:19:57:19 - 00:20:25:18
Mac Lackey
And so it really ended up being and I'm still benefiting from it today, five years later, I can still go to a Champions League final in Turkey with, you know, someone else is kind of funding insights, access. So looking at non-financial opportunities in a deal structure, particularly when it's easy for a company, it's kind of an add on or a throw in to them, but it can be very meaningful to you personally.

00:20:25:18 - 00:20:49:10
Mac Lackey
And so I've had, you know, equipment that funded my my next business thrown in at the 11th hour in a deal. And I've had lots of things that I've just, you know, not renegotiated but just sort of added on that that really help add value to my life. And so that's another thing I always encourage founders to do, is look for those things that are easy for a buyer to give you or add on now but can be very meaningful to you.

00:20:49:15 - 00:20:50:09
Mac Lackey
That's part of it.

00:20:50:09 - 00:21:10:04
Todd Sullivan
Read Advice. I would encourage founders, if you don't know exactly what that is, talk to your M&A experts, your investment bankers who have worked with these clients before because they've likely seen a give, you know, at the end when the majority of the deal is is structured that you wouldn't have thought of, that could be really meaningful to you.

00:21:10:04 - 00:21:27:22
Todd Sullivan
I know in my first sale, I remember at the signing table, they wanted the buyer wanted us to be happy and I didn't look very happy, but I was told by our investment banker, don't look happy. And so I didn't. And they said, Is there anything that we can do for you? And I said, Well, I've never played golf before.

00:21:27:22 - 00:21:51:21
Todd Sullivan
And the company was the Amerigroup of this big sports conglomerate. This will take a set. Anything you see in the in the warehouse, in the showroom, you take whatever you want. So it certainly wasn't like international travel, but that was a kind of a funny one for me. I'm going to actually watch I'm going to ask all of our founders right in these in the engagements that we have is at the end, is there one little thing we know?

00:21:51:21 - 00:22:20:00
Todd Sullivan
Time kills deals, so you don't want to throw something kind of at the goal line. But I bet there's something really interesting that our investment bankers would be able to hint at and get something right at the end there. That's really fun advice. You know, what I'm excited about is what you're doing today with exit DNA because so many of us, we get to a certain point because our skill set brings us there, and yet we don't have the skill set to take the business to the next level.

00:22:20:00 - 00:22:41:22
Todd Sullivan
So maybe you're doing 10 million in revenue and you know there's more to go. Maybe it's about getting the right people on the bus, in the right seats and you doing something a little bit different. But we get founders all the time that have a business and they have an expectation of the value in the market. And it's just not quite there.

00:22:42:00 - 00:23:09:17
Todd Sullivan
And we love having that conversation of what are these things that you could do in the next 18 months to get that value? And you know, we don't have a playbook, but you do. And so that's why I think there's this going to be this natural partnership going forward. Can you tell us about exit DNA, but also maybe some of the bigger things that you're able to achieve so founders can come back to us and hit the bigger numbers that they're really looking for today?

00:23:09:19 - 00:23:33:21
Mac Lackey
Yeah. So just the 92nd back story, you know, I sold my last company in October of 2018 or thereabouts, and up until that point, you know, my life was really defined by two things. It was whatever company I was running and time with my family, which I had optimized for really, really hard. And so anything else in the world, I was head in the sand, you know, day before the Super Bowl.

00:23:33:21 - 00:23:52:02
Mac Lackey
I couldn't tell you who was playing. So I got I sold my last company and a group reached out to me and asked me to speak at this event. And I said, I don't go to events. I'm not a good speaker, it's not a fit. And they basically said it's a group of entrepreneurs, very successful. Many of them want to exit in the future.

00:23:52:02 - 00:24:14:10
Mac Lackey
That's something they've kind of indicated to this group that he was calling a mastermind and just, you know, show up and tell your story, mistakes you made, things you did. Right. So, long story short, I agree to go to this event. I didn't even know what a mastermind was at the time. I'd never even heard the term. And I go up on stage massive imposter syndrome because I'm looking out and seeing people that I actually follow and I know who they are.

00:24:14:10 - 00:24:32:21
Mac Lackey
And I'm thinking, why am I on stage? And I just shared stories. And as I walk off the stage, right, eight or nine different entrepreneurs jogged up to me and said, I need your help. What you just shared on stage I've never heard before. My M&A advisor has never said that. I've never heard it from my bankers, whatever.

00:24:32:23 - 00:24:55:23
Mac Lackey
And in hindsight I get it. I know what it was, but I made one of many comments that resonated. One was I have sold six companies and I never once sold on a financial metric. I never sold for revenue multiple or even on multiple. And I was always able to find buyers in other industries that were really looking to break into the industry that I'm in and pay me a premium value for that.

00:24:56:00 - 00:25:16:04
Mac Lackey
And so everyone was saying, How do I do that? How do I implement that in my business? So that was really the formation of the DNA is I said, okay, I have a skill set that I didn't realize was valuable to people, but I've been on this journey my whole career. I've made a ton of mistakes. I've done a few things right and I want to help people.

00:25:16:04 - 00:25:37:00
Mac Lackey
So I basically started that. DNA is is a really informal way to work initially with that group of founders. And I took everything I had learned and kind of packaged it up in a way that I could kind of teach it and share it in a framework that was easy to implement. So I've been doing that now since kind of late 2018, working with founders all over the world.

00:25:37:01 - 00:26:02:17
Mac Lackey
And I think the the thing that I hear most frequently is if someone is a couple of years away from wanting to exit, that the ROI is so high because I'm I'm helping them think differently about how they're building their company, how they find the right type of buyers, how they have what I call the irresistible exit story to make it where someone wants to pay you a premium for it.

00:26:02:19 - 00:26:25:17
Mac Lackey
But what I don't do is what you do. I basically help founders kind of reframe and get ready and make lots of little changes that compound into value over time. But ultimately they get to the point where they say, I now want to run a process, I'm ready to sell, I need to sell. And that's when kind of my work typically ends.

00:26:25:17 - 00:26:51:01
Mac Lackey
But in almost every case, if if I hand them off to an investment banker or an M&A advisor, I get a call later thanking me for how prepared they were and how differently they're thinking about how to find the right buyers and how to structure things. So yeah, that's what I've been working on and I'm having a ton of fun because I get to kind of live vicariously through founders hitting their goals and dreams.

00:26:51:01 - 00:26:52:20
Mac Lackey
And it's been it's been romantic.

00:26:52:20 - 00:27:26:04
Todd Sullivan
It's such a great story. You know, when when you just said talking to the investment banker and them thanking you, I mean, you're giving them ammunition, right, to go out there and create that strategic outcome. I found in the companies that I built, it was really important to have strategic partners that were generating real revenue because having that kind of tension with any other buyer that could be coming to the table, having that one strategic pushing up the value of the business is just invaluable.

00:27:26:04 - 00:27:44:16
Todd Sullivan
So I can see a lot of the investment bankers. You we have elite at exit wise, they're trained at Goldman Sachs. They get pigeonholed into one particular area. They know all the buyers and they decide to go out on their own and be really flexible and only take a certain number of deals. So those deals are so important to them.

00:27:44:18 - 00:28:06:12
Todd Sullivan
And when I can bring them somebody that has like baked in buyers already, I mean, the smiles are going like this one's not going to be off of financial metrics. This is going to be strategic value. I mean, you're absolutely nailing it. The fact that you can arm founders with this before they go into an M&A transaction, it's just going to make everybody much more, much happier in the outcome.

00:28:06:18 - 00:28:22:19
Todd Sullivan
So I can't wait to be actually sending people to you because we get a lot of founders that they want to know, hey, how do we hit a certain goal? I'm like, You're not quite there yet, but you know, let's put some structure around this. Get ready, get your books in order, get the right partnerships in place and you can get there.

00:28:22:19 - 00:28:28:07
Todd Sullivan
And it sounds like you're getting them there rather quickly. So super valuable service and not something we do.

00:28:28:09 - 00:28:57:05
Mac Lackey
I appreciate that and I really do. I see it almost every day. You know, it's like the mind everybody we work with, every entrepreneur are so smart and impressive and talented, and they're good at what they do, but what they haven't done and what they don't do is sell companies. And so just helping them lift their head up and kind of open the aperture to who would value what I've created, you know, not just in my industry, because the path of least resistance for so many is let me find a larger version of myself.

00:28:57:10 - 00:29:26:16
Mac Lackey
Right. You know, so if I'm doing 10 million, I'll find a $50 million company in my industry. That's the perfect buyer. And the reality is the big opportunities are when people outside your industry are trying to break in. So the more we can help founders and entrepreneurs open up the aperture and start thinking and sort of exercising that muscle of who would value what, we've created our clients, our products, our services, our geography, our intellectual property, all those things they start stacking up.

00:29:26:16 - 00:29:43:14
Mac Lackey
And the more broadly they think about it, we even have this real simple spreadsheet. I call it the solid gold buyer sheet, just to help them start to like come up with ideas. They don't even know that these companies would be interested, but they're training their brains to like, why would someone want to buy it? What's the reason?

00:29:43:14 - 00:30:13:23
Mac Lackey
What's the thesis? Start tracking the company, reading their press releases, and all of a sudden one little thing pops up in the press. You're like, That's why they want to buy my company. And the more you do that, the more talented or articulate you become in doing that very quickly. So by the time you get to someone like yourself, you can say, Hey, I think there's five different industries that would be interested in what we've created, and here's 17 companies I've been tracking and you know, I haven't talked to them, but I think they would be interested in, here's why.

00:30:14:00 - 00:30:41:19
Todd Sullivan
Oh, you're doing half the work for your investment banking team. It's fantastic. I would tell you that as much as we profess that having an industry expert, investment banker leading your team is the way to go, they will tell you that more often than not, it's buyers outside the industry that want in that become potentially the best fit for you and the best opportunity to maximize your outcome.

00:30:42:01 - 00:31:02:21
Todd Sullivan
Now, when you also leverage the tension of buyers that look just like you and want to get bigger, right, you can kind of set the floor on value and then really push the numbers up with strategics that want to get in. So it's it's awesome advice. You know, I know that there is so much more that you and I could talk about and we could just keep giving advice to our fellow founders.

00:31:02:21 - 00:31:19:09
Todd Sullivan
And that's what this is about. But I want to be respectful of your time. Is there anything else that you can think of? You know, our audience loves to hear the personal side of our guests, and you certainly given that and I don't want to shortchange, you've had six exits. So, you know, there's just a wealth of knowledge.

00:31:19:11 - 00:31:25:12
Todd Sullivan
Is there anything that you want to leave us with? One more kind of nugget.

00:31:25:14 - 00:31:51:13
Mac Lackey
And the only other thing I would say is I think there is an opportunity for most entrepreneurs to it's just about being proactive and thinking about things far in advance. One of the companies I sold many years ago to NBC Sports, I had reached out proactively to the CEO of the division that ultimately bought us, you know, two years before we sold the company.

00:31:51:15 - 00:32:16:00
Mac Lackey
And it was really just my own going sort of view of I want to be connected to and talking to the people that are relevant that I think are going to value what we're creating. Because if I create a relationship, then I can, you know, always pick up the phone and call them. And I've done that now multiple times where, you know, I don't know what the trajectory of the business is going to be.

00:32:16:00 - 00:32:30:10
Mac Lackey
I don't know where the market's going to go. But in the case of that particular gentleman, he and I hit it off. You know, I literally just called him out of the blue cold call and said, I'm going to be in your town. I have a lot of respect for what you guys are doing. I'd love to meet you.

00:32:30:10 - 00:32:50:15
Mac Lackey
Just tell you what we're up to. No strings attached. So he, you know, had me in for a meeting. We hit it off. We lightly stayed in touch. And then when it was time to sell the company, I literally picked up the phone and said, We're going to sell the company. We got a lot of people interested. I cannot imagine you not being one of the perfect buyers.

00:32:50:15 - 00:33:17:22
Mac Lackey
And so it would be remiss for me not to call you and just say before I sell it. Do you have any interest in taking a look? They started due diligence the next morning. I mean, it was such an easy pull them into the process. So I say that just because I think an entrepreneur, even with know 1% of their time as they're building their business, just thinking proactively about would I like to be able to interact with these companies in the future, just start now.

00:33:17:22 - 00:33:26:16
Mac Lackey
Just start, you know, lightly getting to know them, being, you know, kind of interesting in the industry. And that's that's served me very well over the years.

00:33:26:18 - 00:33:43:11
Todd Sullivan
That's great. I don't know that I have a story that backs that up, but it makes a ton of sense to be really curious in your industry, build great relationships and have in the back of your mind how they could be valuable to you, either in business development or at the end at the goal line for an exit.

00:33:43:13 - 00:34:01:09
Todd Sullivan
Mac Look, this has been this has been awesome. I feel like we're going to be able to work together going forward. I really appreciate your time. I'm super curious. Right. So you own part of a sports team, right? Professional soccer team. Yeah. So how did that happen? That is sweet.

00:34:01:11 - 00:34:33:10
Mac Lackey
Yeah. So, yeah, the soccer big part of my life in 2014, after I have two daughters, after pulling them out of school and traveling for a while, we ended up moving to Barcelona and while I was living there, my favorite team, FC Barcelona, had season tickets. I was going to every match and the idea started to kind of pop in my brain that after my kids were kind of on their, you know, journey in college or post-college, I really wanted to move back to Spain at least part time.

00:34:33:12 - 00:34:52:10
Mac Lackey
And the idea of buying a team in retirement was just something that sounded appealing to me because I wanted to stay connected to the game. I met a gentleman who was the CEO of a multi hundred million dollar club at the time, and he and I really connected on kind of the vision of what was going to happen in the in the space.

00:34:52:12 - 00:35:17:08
Mac Lackey
But that was back in 2014 and about two years ago. It just kind of hit me again that there has to be an opportunity because many of these soccer teams, soccer clubs around the world, but particularly in Spain, where I was interested, a lot of 100 plus years old, there are local monopolies. They have incredible followings, but they just don't run like businesses.

00:35:17:08 - 00:35:36:22
Mac Lackey
You know, they're not they're run by enthusiasts, business people. And so I just decided to kind of dig into it and take a look if my thesis was right. And so I started kind of, you know, putting the feelers out and letting people know I wanted to look at opportunities. And I started run in due diligence on a number of clubs that kind of met my criteria.

00:35:37:00 - 00:36:01:21
Mac Lackey
And I was shocked how like low hanging fruit that, wow, they don't use KPIs to track performance, They don't even budget really, they don't a lot of them are break even. Maybe they lose a little bit of money, but they can't tell you what their revenue streams are going to be like. Just really shocking. And despite that, they've survived world wars, pandemics, recessions.

00:36:01:23 - 00:36:21:09
Mac Lackey
So it's like there's a very resilient business that's under optimized so incredibly long story short, I just kind of made the decision just over a year ago. I said, you know, I'm going to I'm going to buy one. I just I think it's not only something I'm passionate about, I think it's a significant business opportunity. And so I ended up buying a team.

00:36:21:09 - 00:36:47:16
Mac Lackey
And in southern Spain just about a year ago, beautiful location right at the bottom of the Costa del Sol, the Strait of Gibraltar. You can see the Rock of Gibraltar over the back of our stadium, Morocco's 14 kilometers away, right across the water. And so it's a place that people want to spend time, but it's 114 year old club that, you know, I just saw a list of 100 things that we could do to improve.

00:36:47:18 - 00:37:04:17
Mac Lackey
And so, yeah, it's been it's been really fun. I my the gentleman that was the CEO of a very large first Division club agreed to go in with me, partner with me. I hired him as my CEO. He relocated to this town and is running it day to day and I'm having a ton of fun. It's been great.

00:37:04:17 - 00:37:23:02
Todd Sullivan
That is awesome. I watched some of your videos and I also have two daughters and that idea of kind of relocating to different countries and giving that them that kind of exposure is something I really dream of doing. I can't say that. I think I can figure out how to own a minor league hockey team, but similar to you, right?

00:37:23:02 - 00:37:42:18
Todd Sullivan
It was at that time where when I turned kind of professional, you had to be here in the U.S.? I mostly played in the East Coast Hockey League and Europe wasn't available. I don't know if it was an EU thing hadn't happened, but they would only allow a number of Americans on a team. And I was a goalie and they always they're really looking for the, you know, that one goal scorer.

00:37:42:20 - 00:37:55:07
Todd Sullivan
And then it all opens up, you know, four years later. So I think we had maybe a similar experience. I have lots of friends now that go over and have amazing experiences, great pro careers, right. But also get to see the world like that is incredible.

00:37:55:10 - 00:37:58:10
Mac Lackey
Yeah, I'm really jealous. I think I was born too early.

00:37:58:12 - 00:38:14:09
Todd Sullivan
Yeah. Yeah. And I think or I'm 52, I think. Are you? You're right around that age. Yeah, yeah, yeah, I think. All right, well, Mick, thank you. I feel like I want to buy you a beer and hear more of these stories. At some point, hopefully we'll find a find a way to work together. Thanks for sharing it all.

00:38:14:09 - 00:38:15:17
Todd Sullivan
I really appreciate it.

00:38:15:19 - 00:38:18:04
Mac Lackey
Thanks for having me. I really appreciate it. Todd.

00:38:18:06 - 00:38:40:09
Todd Sullivan
Thanks again for listening to the Cashing Out podcast. For more Founder Exits stories, please subscribe to the Cashing Out podcast on Apple, iTunes, Spotify, or wherever you listen to your favorite podcasts. And please remember ex it was dot com and the Cashing Out podcast are for entertainment purposes only. This should not be relied upon as the basis for investment decisions.