Great. Awesome, awesome. I want to start with taking you back to my

senior year in high school a long time ago.

And I was playing in a football game.

It was the seventh game of my senior year.

We had lost every single game of my junior year.

We lost the first six games in my senior year.

And I was a very mediocre football player on a really lousy team.

And it was late in the game,

in this particular game I actually had a pretty good game.

I caught a touchdown pass and I'd caught a couple of other passes,

so I was having a pretty good game and we were actually within

kind of striking distance of potentially winning the game.

And as we were on the opponent's 10-yard line

and as the quarterback rolled out,

I was in the end zone and I happened to be open,

but the quarterback didn't see me.

And I had to split-second decide,

so I raised my hand and let the quarterback know that I was open

or should I - and thereby take the chance that he throws me the ball

and I drop the ball and become the goat or should I not

raise my hand and let the quarterback have his chances,

if he gets in the end zone. And my decision it felt like an eternity

in that split-second of my calculus.

And I ended up making a decision that's kind of haunted me,

but then formatively changed me for years.

I made the decision not to raise my hand.

And the quarterback didn't see me,

he ended up getting tackled and we ended up losing.

And I struggled with that so much afterwards because

what really was the reality of what it was,

I was more afraid of failing than I was afraid

of being mediocre at that time in my life.

I didn't have enough confidence in myself to really step

out there and appreciate what I really could do.

It was only later that I had learned that I had more fear about

being mediocre than I did about failing which is ultimately what

pushed me over the entrepreneurial cliff, if you will.

The second one that I want to mention is failing at

my - getting my lifeguard certificate when I was 16.

And I thought I studied, I thought I did the practical exams;

I thought I did all that, but I failed miserably on both.

I failed on the practical exam and I failed on the test.

And for years, again,

I agonized over how can I fail a lifeguarding test?

How could I do something to fail something like that?

But when I realized what it did for me it was one of

those formative moments that it taught me the rest

of my life that I better out-prepare everything.

So today, I'm not necessarily the sharpest

guy intellectually in the room,

but I will outwork anyone in the room.

And I learned that kind of a secret to a successful 40-hour work week

is to work 80 and that's just how I can - that's just how I can do it.

I also learned the value of networking.

I got a pretty good job out of graduate school because

I went to a pretty good graduate school.

I went to a pretty good graduate school because

I had a pretty good job before that.

I got a pretty good job before that because

I got a pretty good internship.

I got a pretty good internship because I was involved in

the accounting society at my school and I hosted different

firms to come into town to meet with the students.

And as they were coming in to meet with the students,

I realized that, hey, I can network with this people and I can

maybe do something good for myself.

And I did that and it kind of helped.

And the value of networking is just so important,

particularly at a younger age.

I will give you one other example of the value of networking.

How many of you've heard of the economist, Jeffrey Sachs?

So most people have heard of him.

You're far ahead of me, I didn't know who he was five years ago.

But as I started on my quest to learn about

poverty alleviation in extreme poverty,

I kept stumbling across his name when I was

Googling around and doing web surfing.

And one night I decided - one night I found his e-mail on one

of the blogs I was reading and I thought what the heck,

I'm going to e-mail this guy, who probably will never respond,

but I'm going to try.

So, I e-mailed him at 11 o'clock at night,

got back over the next morning at 7:00 a.m.,

there was an e-mail from Jeffrey Sachs and it said,

hey, Jeff, nice to meet you, if you can call me at 10:10,

call me and I'd love to talk with you.

So I decided between 7:00 and 10:00, I better research who he was,

and thankfully, I hadn't done it the night before

I probably never would've emailed him.

And I got on the phone with him at 10:10 that morning

and we had a nice 20-minute conversation.

He invited me to New York to meet with him and he said,

I'm sorry, Jeff, I got to go,

I've got the President of Malawi in my office.

And I thought, jeez, I really felt awestruck.

And my point is you may call it e-mail stalking,

but I do it all with time.

I do it with LinkedIn, I do it with e-mail,

I probably emailed 10 people a week that I don't know

and probably nine of them don't respond.

But the one that responds tends to sometimes open

a door and sometimes we don't want to do that,

but I would really encourage you to kind of push yourself

out of your comfort zone and try doing that kind of thing.

I wanted to give you a little bit of my experience.

I think its relevant and talking about commercial entrepreneurship

and social entrepreneurship and I spent four years in

public accounting at Ernst & Young,

where I really learned what a CPA really means.

It means cut, paste, and attach.

And that was about the extent of my - I knew

I didn't want to be an accountant forever,

but I felt like it was a great language of business to really learn.

And now I spent 12 years involved in a

middle market kind of no name company.

And sometimes I think we get our brains,

we want to go work for the big consulting firm,

or a big investment bank or the big brand or whatever and

in reality sometimes the middle market-type companies,

you can get really great experience just

by working in a middle market business.

This was about a $300 million or $400 million business and I was

able to move around or move - I think I moved 10 times in 10 years

and I was able to move around and get lots of different general management

experience and it was really a great experience for me.

But towards my - the end of my late 30s,

I began to really think I want to go off on my own and I want

to take that entrepreneurial plunge, I want to do that.

My wife, who is a Mediterranean, and first generation American,

has the risk tolerance of Richard Branson.

So she is always pushing, pushing, pushing, to kind of do that,

but I grew up kind of Midwestern-ish and I had a very risk averse,

somewhat risk averse profile. But I knew I kind of wanted to do that.

I knew I want to do that and I felt like I was standing on a high board

blindfolded wondering if there was water in the pool beneath me.

Knowing that I want to take that plunge,

but I just can't quite take that plunge because

I wasn't sure if there was water in the pool.

And then to make matters worse,

my mom piled on and she wanted me to do it.

And then when your mom wants you to do something,

you know maybe it's a bad idea, right?

Because I remember when I played high school football,

we lost a game 42 to nothing and I had

a horrible game and I came into the house,

and she said, well, I thought you played good, honey.

So, I just wasn't quite there,

but I was - one night I was channel surfing late and I came across

an interview and there was an interviewer who was going around,

he was interviewing about 10 people, senior citizens.

And he was asking them what did they wish

they've done differently in their careers?

Every single one of those people said they

wish they've taken more business risk.

They wish they had kind of put it out there a little bit further.

And the last thing you want to do is get

to that stage in your life and feel like,

jeez, if only I had kind of taken that shot.

I'd much rather take the shot and be able to look back and say,

hey, I took the shot, it didn't work, but I took the shot,

I gave it everything I got.

And I realized at that time that I had switched my paradigm from that

high school football example of being more afraid of failing.

Now I was more afraid of being mediocre than I was of failing.

So I worked out a deal with my employer to leave and I spent three

months basically working with them on a transition plan,

I was running a $200 million business and I worked out

a deal with them and I felt really good about that deal

I was - took a tremendous amount of integrity in doing that,

I would really encourage any of you

to the extent you leave somewhere,

you only have your good name in life to really

live as your legacy and it ended up as I left.

After I left, I wanted to go find a company to buy and build.

And there had been a company that we passed on in

the company that I was at just before I left.

And I was out looking for businesses and I remembered that company.

So I went back to the CEO of the company and I said,

hey, do you mind if I contact these guys?

We passed on them previously.

And I said, yeah, no problem,

it was a - it didn't make sense for us in that particular situation.

And that was the company I ended up buying.

So really not burning bridges, really doing things right,

it was really so important.

I want to give you a little bit of synopsis

on the six - I have done six deals,

commercial for profit traditional deals since I went off on my own.

And I want to talk a little bit about the things

that were common between the good ones and the

things that were common between the bad ones.

And I had of the six, four were good, two were really good.

Not quite as good as Instagram, but they were pretty good.

And two were horrific,

kind of cratered on the rocks and bad news story.

And a couple of the things that are important,

the two bad ones, the economic cycle and the timing of

the economic cycle were both right before a recession.

So I bought one right in 1999 and I bought one in 2006.

And it's really difficult and the type that

I would do which were leveraged acquisitions,

the type that I would do if the economy turns on you,

you don't have a lot of room to maneuver.

The second thing is gross margins.

If you've got a 30% gross margin,

you don't have a lot of room to kind of bob and

weave if all of a sudden you hit a pothole.

If you got a 60% or 70% gross margin,

you got a lot more room to make a mistake and kind of weather that.

You are also tying up a lot less cash and working

capital in receivables and in inventory.

I also learned - you want to share the upside with people,

but be really careful of the dilution.

It's really - I know two people that started businesses

and ended up selling them each for over $100 million

and they each ended up with only 5% of the company.

And you might say and you're right,

5% of $100 million is a lot of money and it is,

but there is no reason that they shouldn't

had 30% or 40% of those companies.

And what tends to happen is if I'm starting a company and I want to have

Johnny come work with me because I know he has got some skill set,

it's really easy to say, hey, Johnny, come work with me,

I will give you 10% of the company.