Know. Grow. Exit.
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Good Tuesday Morning,
Daylight – This morning, we are going to look at how two totally different places, San Diego and Swamp, can make the same Entrepreneurial mistake right out of the gate. We’ll also see how Carvana is getting the money to go for the kill in getting consumers to buy cars online and skip the dealers with lots full of inventory.
M&A – New Flyer Industries agreed to acquire ARBOC Specialty Vehicles, specialty vehicle maker, from H.I.G. Capital.
Style – San Diego made a big splash this week with a big media buy for a medical tourism destination marketing campaign. Their big bet is that people would rather get a hip or heart replaced at a city with a sunny beach rather than in the cold at the Cleveland Clinic or Mayo Clinic in Minnesota. San Diego will come up short and here’s why:
Buzzard’s Roost – Put it in the top five of biggest Entrepreneurial mistakes ever made – see other people making money and say, “Me, too.” I learned this at an early age with my childhood friend Eugene Kicklighter, who was in the eighth grade like eight times, but to this day, has one of the best mechanical minds I have ever been around, as he could rebuild an engine with his eyes closed or tell you the specs of pressure systems in a jet engine – school was not his thing.
Live Rounds – Finally, Eugene’s dad told him, “You are wasting these people’s time, so you need to decide between the military or a full-time job.” I thought this was a no-brainer as Eugene would have been a winner in military mechanics.
Culture – Instead, Eugene came to me and said he wanted to go into the pulpwood business and asked would I be his business manager. He told me he had heard the Tatums and Thrifts were clearing $100 a day, hauling one load a day. He told me he could do 1.5 loads a day, and to this day, is the only human known to heist a full cut tree off the ground and put it in back of a pulpwood truck.
Economics – My job would be to cash him out at the end of the day after school, and my cut would be 20 percent. By that evening, we were already thinking having five or six work crews. By night, dollars were dancing in our head, and we got so excited, we ran through the swamp and jumped up on a Cypress stump and heard ghosts of Indians cheer us on.
Hot – The next evening after school, I met him at the lumber yard, and he pulled up on the scales with half a load. He said the truck got stuck as it was really too small and really didn’t have the right chain saw, which had broken five blades in one day. I said, “Well, it looks like we will make $50” – not totally bad for first day out. I went inside and stood in line and when I walked up to the cash register, Mr. Harold Davis said, “Cliff, we owe you $29.95.” I replied, “Mr. Davis, Eugene had a half load.” He said, “Yes, but three of your trees were wounded from squirrels and birds, and you were actually two poles short a half load. It’s not just weight. It’s quality and selection, too.”
I walked outside and gave Eugene his money, and he handed me $5 dollars back. I handed it back to him and said, “Eugene, just fix the timing belt next time it slips, and stick with that.” San Diego should stick with surf boards and sightseeing.
Xanadu – noun – a place of great beauty, luxury and contentment
Investment Banking – Carvana raised $100 Million Through Private Placement of Convertible Preferred Stock with Dundon Capital Partners. The proceeds are to be used to fund growth initiatives, including an accelerated pace of market expansion. Carvana has opened 19 markets already this year and raised its target to 21 to 23 new markets, versus original plans for 16 to 18.
The new class A convertible preferred shares will pay a 5.5 percent annual dividend and have a conversion price of $19.69 with the right to convert at any time.
Hedge Funds – Align Capital Partners acquired Lewellyn Technology, a workplace safety and training company, from Evolution Capital Partners.
IPO – Leisure Acquisition Corp, a SPAC hoping to acquire a company in the leisure and entertainment sector, raised $200 million in an IPO of 20 million units priced at $10.
Venture Capital – NanoCellect Biomedical, a developer microfluidic cell sorting technologies for cell-based assays, raised $10 million.
Spotlight – Tonight, Aptonet and Oxford are hosting a specialized CEO-CIO Dinner at The Consulate. Today, we will finalize details with Porsche to hold the same type of event at their North American HQ’s in late January. We should have a firm date by Friday. Content and Systems are still two kings.
ScreenTimes: Jodie Foster and Rosemarie DeWitt
New York City
Monday, Dec. 11
7 to 8:15 p.m.
Spend an evening with the Academy Award-winning and Golden Globe-winning actor and filmmaker Jodie Foster and Obie Award-winning actor Rosemarie DeWitt. Ms. Foster and Ms. DeWitt will discuss their creative processes, their commitment to supporting women in Hollywood and their upcoming project – the Emmy Award-winning fourth season of “Black Mirror,” which is directed by Ms. Foster and stars Ms. DeWitt.
Contact MR Editor Amethyst Bush for details to attend. firstname.lastname@example.org
IPO – Casa Systems, a software-maker for cable providers, said it plans to raise $134.4 million in an IPO of 8.4 million shares priced between $15 to $17 a share.
Exits – TTM Technologies agreed to acquire Anaren, a maker of high-frequency RF and microwave microelectronics, from Veritas Capital for about $775 million.
Venture Capital – Elsen, a platform-as-a-service company for large financial institutions, raised $2.4 million.
Private Equity – A group of investors led by Cornell Capital agreed to acquire Talcott Resolution, a run-off life and annuity businesses that was part of The Hartford, for $2.05 billion.
InterVision Systems acquired Independent Technology Group, a technology firm.
Jaggaer acquired BravoSolution, a strategic procurement solution provider.
Centerbridge Partners closed its acquisition of a majority stake in Davis Vision, a San Antonio, Texas-based managed vision care company.
The Krauter Group invested in Cannasure Insurance Services, a cannabis insurance brokerage.
And that’s what’s ahead, Cliff
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