Mark Haney: And now I'm here with my good friend, anthony Romano, and he is the CEO of Cretelgent, which is a company that has been fast growth over the last several years, and so I want to catch up on the company and then maybe talk a little bit about the industry, the state of what's happening in the macro economy and so on, and how it might affect companies like yours or mine, right?
Mark Haney: So, anthony, maybe just a little bit of your background and tell us what's going on with Cretelgent.
Anthony Romano: Yeah, well, this has been.
Anthony Romano: You know, first of all, thanks for having me again And it's been a journey.
Anthony Romano: You know I started this really in January of 2019.
Anthony Romano: So we're four and a half years in and we have, you know, launched a platform as a service for the entire real estate ecosystem.
Anthony Romano: The platform is called Radius and it provides banks and brokers, reits, owner operators, attorneys, law firms you know all the participants in multiple verticals the opportunity to get micro market and property insights to order status, get delivery of all the compulsory diligence that's done during a transaction And then, post transaction, the monitoring, surveillance of those assets you know, sort of across the country.
Mark Haney: So kind of end to end platform.
Mark Haney: It's kind of like a subscription type thing You can.
Mark Haney: someone pays a monthly fee for access to data.
Anthony Romano: There's a subscription and enterprise license aspect but then we have a lot of you know per transaction.
Anthony Romano: You know scenarios that we have some of the largest REITs and largest law firms in the country where somebody might go by 27 storage units or 13 multifamily properties on, in infrequent cases, maybe quarterly.
Mark Haney: Well, i guess I tapped into a favor the other day because I was working on something with Placer County and they're saying you're going to need a phase one.
Mark Haney: I'm like what the heck is that You know?
Mark Haney: so I tapped into you and you guys know, is your different.
Mark Haney: So that was like a one off, because I'm not, you know, i don't really develop much property.
Mark Haney: But can people utilize you sort of that way too?
Mark Haney: Or was that just because I was?
Anthony Romano: you know, we don't proactively spend a lot of good market dollars on on the one off.
Anthony Romano: but somebody's buying a property and they need an environmental assessment or an appraisal or an all to survey.
Anthony Romano: Those are all pretty compulsory services, Different than residential, where you know, you have a home inspection and appraisal and really that's it on the property.
Anthony Romano: There are eight or 10 different things that banks and owner operators and insurance companies require when you're doing a deal.
Anthony Romano: Okay, i did.
Mark Haney: So you guys do appraisals too?
Mark Haney: Yep, Okay, And when you guys do an appraisal, do you?
Mark Haney: I assume you send somebody out there or you do it.
Mark Haney: I mean because you're kind of like a remote, all it's funny.
Anthony Romano: So you think of the platform radius as the UI UX to the client?
Anthony Romano: okay the order management workflow platform.
Anthony Romano: Behind the scenes We've built an entire panel management technology platform.
Anthony Romano: So on that platform would be MAI appraisers, environmental professionals, certified building inspectors, land surveyors So all of those products I mentioned have a site recon component to it and an individual will go out, they'll use our mobile app, do the data collection, take the photos.
Anthony Romano: It comes back digitally into our report writing tool.
Anthony Romano: Then we put it together you know pie and put the report together and back it goes to the platform.
Anthony Romano: So there's a we call it tech enabled services.
Anthony Romano: There's a technology, there's great data.
Anthony Romano: But because it's a pretty regulated industry, these things are required on 90% of the transactions.
Anthony Romano: We provide the end to end service.
Mark Haney: Okay, so there's humans, so you do have partnerships with the people out there doing a lot of this field work.
Mark Haney: I take it.
Anthony Romano: Yeah, the data I mean.
Anthony Romano: if you think about, if you're an environmental professional or you're a building inspector, that's your craft.
Anthony Romano: You might not be great at sales and marketing.
Anthony Romano: So how do you go face off with hundreds and hundreds of clients to get work?
Anthony Romano: Well, we do that for them, right?
Anthony Romano: We face off with the bank, with the commercial brokers, et cetera.
Mark Haney: And so the business is.
Mark Haney: Let's talk about the stage of the business, if you don't mind, because you guys have made an acquisition and so maybe the stage of the business and sort of where you vision taking it.
Anthony Romano: We started growing it organically and coming from sort of the core logic first American world.
Anthony Romano: I learned a lot about the notion of you have no business doing acquisitions if you can't grow organically.
Anthony Romano: So we started with real good organic growth and then there were some kind of tucking acquisitions that we did.
Anthony Romano: We did a couple small And then last year we did a strategic acquisition of a business partner of ours out of Akron, ohio that was called Nexus CRE And yeah, we've done the integration and a lot of cost synergies and revenue synergies.
Anthony Romano: So it's been great.
Anthony Romano: We'll do more.
Anthony Romano: We're pretty opportunistic as the market's been hit pretty hard.
Anthony Romano: There's a lot of really innovative technology companies out there in the space that are doing cool stuff but have a big burn and very little revenue And so, yeah, we'll keep doing that Okay, so interesting.
Mark Haney: So I want to be a little bit educated here, maybe for our audience too.
Mark Haney: So don't do an acquisition unless you can grow organically as well.
Anthony Romano: Yeah, i mean I think the idea would be particularly from the investor, the private equity venture side, if all you're doing is get growth because you know how to tuck in companies that's a different game.
Anthony Romano: So we have a multi-dimensional where we say, hey, we have an organic strategy, we have an acquisition strategy And then the middle, we have this partner distribution, white label strategy where we've got a lot of companies who have pipes into the clients we want to work with and we do arrangements with them in all ways and fashions.
Anthony Romano: So growth strategy is multi-dimensional.
Mark Haney: So it's real estate.
Mark Haney: So I got to ask you you know everybody, you're just predominantly commercial real estate, as you mentioned, and I guess developers that are, i guess, developing some residential you might utilize someone like that, like a would like a big home builder potentially be a client.
Anthony Romano: No, it really is the asset If you think about.
Anthony Romano: You know residential is single, family, multifamily.
Anthony Romano: You know one or two other pieces of property.
Anthony Romano: Everything else is commercial.
Anthony Romano: And I think people my wife sort of said when I started this because I'd come from residential and cat markets the heck do you know about commercial real estate?
Anthony Romano: And it's like it's everywhere.
Anthony Romano: It's the gym you work out at, it's the office you go to, it's the school your kid goes to, it's where you shop, it's the pub you drink at.
Anthony Romano: I mean, go down, everything's commercial real estate.
Anthony Romano: And so we predominantly deal with folks buying and selling and managing commercial properties.
Anthony Romano: We work with developers who need some of those services.
Anthony Romano: But it's a multifamily property.
Anthony Romano: Who's, somebody owns it, somebody else is buying it and we're working with the transaction.
Mark Haney: So which segment of the market excuse me, which of those groups is like the biggest market for you?
Mark Haney: Is it the lenders?
Mark Haney: Is it the brokers?
Anthony Romano: It's a right.
Mark Haney: Now I tell you the certainly the lender and when you say lender, think Like a bank.
Anthony Romano: Think credit union, think community bank, think regional bank, think national bank, think non bank, non depository.
Anthony Romano: Bridge and mezzanine, you know lender and things of those nature.
Anthony Romano: those folks have you know policy around asset class and loan amount and LTV and based on that, here's what has to happen during a transaction.
Anthony Romano: So they order a lot from us.
Anthony Romano: Those are high volume clients.
Anthony Romano: They use our platform on subscriptions, but then the REITs and then one of the biggest clients of ours are real estate attorneys.
Anthony Romano: So they all have a practice that deals with large REITs and deals with corporate owner operator clients.
Anthony Romano: So they would work with somebody who's buying, you know, 47 gas stations or 150 storage units and they're helping with the transit, the legal and financial diligence, and then they need somebody like us to come in and do all of the market and property do it.
Mark Haney: And the problem you're solving.
Mark Haney: Is it predominantly the hassle factor, so it saves a lot of time for the law firm, or is it cheaper?
Mark Haney: How do they get a benefit?
Anthony Romano: Any of those users?
Anthony Romano: yeah, so think about the alternative.
Anthony Romano: What would happen as a bank is, instead of coming to a cartel agent in this platform right and order status delivery of these end-to-end solutions.
Anthony Romano: You would have a Rolodex of single-threaded monoline providers and you'd either pick up the phone or you'd call an appraisal company or an environmental company or a survey company or a and you'd wait for them to respond and get a proposal, and then you'd turn it around and you'd look for your email or you'd use Dropbox to get a report back and really manual, very uninspiring and inefficient.
Anthony Romano: This platform collapses the cycle time, reduces the friction and the transaction improves the experience of all the counter parties in the deal.
Anthony Romano: So it's been yeah, we've been super.
Anthony Romano: That's been the biggest validation, not just the retention aspect of the client that we've enjoyed, but the feedback and utility they get has been bananas And we just did our third net promoter score you know where we talk to our customers and survey them.
Anthony Romano: Industry average in our space is somewhere around 40 or 50, our score was a 74,.
Anthony Romano: I mean, sounds super arrogant, but I think it's less.
Anthony Romano: Just the technology and the platform, but we flank it with world-class customer service.
Anthony Romano: When somebody's buying 38 storage units right, this is a hundred, 200, $300 million transaction you gotta lean in and be part of the transaction with them and help navigate and interpret and almost be part of their deal team.
Anthony Romano: So we say high tech when you want it, high touch when you need it.
Mark Haney: We sort of flank it with customer service And it's kind of like a one-stop shop versus, yeah, having to call five people.
Anthony Romano: Commercial real estate storefront workflow system for end-to-end due diligence.
Mark Haney: Interesting Okay yeah, i can see it being super.
Mark Haney: is it cheaper than calling you know?
Mark Haney: is it more affordable Because it's one service subscription thing?
Anthony Romano: Well, not only the, service is, you know, probably really competitively priced, high quality and fast, but the efficiency that's gained.
Anthony Romano: we have clients who said, hey, we've taken seven, eight, nine days out of our process And if you're a bank, you just did a transaction.
Anthony Romano: If you're a bank and your borrower gets to get into their property faster, less expensive and start running their business, that's a huge win.
Anthony Romano: Yeah, 100%.
Mark Haney: Okay, so everybody's talking about artificial intelligence.
Mark Haney: We're investing into a lot of startups that are dealing with artificial intelligence, and a lot of it is around driving efficiency, and is that gonna be a piece of what you do, or is that a piece of what you do?
Anthony Romano: We're working on it today.
Anthony Romano: There's a local company.
Mark Haney: It's a Moneta portfolio company called AppOrchid, that we spend a lot of time with.
Mark Haney: We've built our ontology, we've built sort of our, And we're a company, we're investing there too.
Mark Haney: Yeah, yeah okay.
Anthony Romano: So we've built our data fabric.
Anthony Romano: I mean we see both a use case in turtle and external.
Anthony Romano: I think internal when you think about using the computing power to reduce the cost and the time it takes.
Anthony Romano: So for a phase one environmental assessment, as an example, it might take a report writer, an expert, eight hours to put that together, compile it, et cetera.
Anthony Romano: Chat GDP just passed the CPA exam last week on the first try.
Anthony Romano: Right.
Anthony Romano: We have models internally that we're working on cutting that time in half and then a human QC's it.
Anthony Romano: So if you can double your output and not literally grow your FTE it's a home run So internally, we see a real opportunity for the client when you think about decision intelligence and all of the disparate data sets and places somebody has to go to make a decision.
Anthony Romano: Just think about location logic you're looking for a site.
Anthony Romano: Well, if you use AI and our front end to come in and look at location biases, stay duration, traffic patterns, income composition, all the demographics, to say, hey, this is the right place to look for a site.
Anthony Romano: So I think there's a ton of use cases in the commercial state world.
Anthony Romano: And yeah, we'd like to be out front.
Mark Haney: Yeah, it makes sense.
Mark Haney: I mean we're using it around here kind of at a small time level with chat, gpt a little bit, and there's a.
Mark Haney: We have a, actually a podcast, you know the stuff, that ways to make our podcast more efficient and stuff like that.
Mark Haney: So yeah we're.
Mark Haney: It feels like it's taking the world by storm, similar to the way you've taken, you know, the commercial real estate processing by storm.
Mark Haney: It's just creating, you know, so much more efficiency.
Anthony Romano: Early innings in it.
Anthony Romano: It's really neat and it's funny.
Anthony Romano: My wife said, hey, does AI replace humans?
Anthony Romano: And I said I think humans that use AI will replace humans.
Anthony Romano: There's no doubt about it.
Mark Haney: I mean, the power of the computing is pretty special, yeah, and maybe we'll have time to make more complex sort of creative decisions and collaborate and things like that, instead of process, process, process all the time.
Mark Haney: We're always running these processes when, my goodness, somebody, you know the machine can do it, no doubt, no doubt.
Mark Haney: Okay.
Mark Haney: So everybody's probably wondering your view on the commercial real estate market.
Mark Haney: You see, you're probably at the front end of seeing where you know where that might be going And I know that that's a broad market.
Mark Haney: We brought up multifamily, there's obviously industrial, you know retail office and so on, give me.
Mark Haney: And then we get the banks tightening up too because of the problems with Silicon Valley Bank and so on and interest rates being up.
Mark Haney: Maybe just help me understand your perspective on this landscape.
Anthony Romano: Yeah, i mean you had blockbuster years and values and transactions in like you know sort of 1920, 19 and then going into 2020.
Anthony Romano: The pandemic obviously changed everything And you had the Fed, you know sort of rightfully so, ease and make money available and things of that nature, and so interest rates went down precipitously.
Anthony Romano: Right, the Fed had, you know, 25 basis points on the Fed funds rate Fast forward, get out of the pandemic.
Anthony Romano: Valuations are going up, interest rates are still low, access to capital is great and you know transactions were going bananas.
Anthony Romano: So the Fed has raised rates 10 times this.
Anthony Romano: Pause for a minute, but that took the Fed funds rate from 25 basis points to five.
Anthony Romano: So if you think about cap rates, which is the yield on an investment when your cost of capital exceeds your cap rate, you're inverted.
Anthony Romano: It doesn't make any sense.
Anthony Romano: So right now, the dynamic that is this, and it started really in the third quarter of last year you saw transaction volumes for all asset classes.
Anthony Romano: Everybody talks about asset office because that's the work from home, and now we're back to this hybrid and you've got 60% occupancy across the country and in offices.
Anthony Romano: There's no doubt that asset class has been impacted the most, but all transactions slowed.
Anthony Romano: In fact, year over year.
Anthony Romano: Commercial real estate transactions are down almost 70% across the board And that's a function of the values high of the property and the cost of capital has increased.
Anthony Romano: What we have seen in the last really 60 days is valuations declining And that has to happen in order for deals to get done.
Anthony Romano: There is historic amounts of uninvested capital and liquidity on the sidelines right now.
Anthony Romano: So we have talked to tons of our customers who are just waiting, who buy either single properties or multi-site or big portfolios, and it will come back.
Anthony Romano: I mean historically, when you think of where these rates are.
Anthony Romano: They're not historically high, but relative to where we were 12 and 18 months ago.
Anthony Romano: It's bananas.
Mark Haney: Yeah, what about?
Mark Haney: and people aren't building new either.
Mark Haney: Is that right?
Mark Haney: I mean, you got the transactions, but then you know new development.
Anthony Romano: Yep, i think there's some, i mean in certain asset classes.
Anthony Romano: There's some, certainly in storage, industrial there's still a lot going on in that area student housing and there's still some multifamily.
Anthony Romano: But yeah, you're right, the trading of these assets or portfolios is it has slowed.
Anthony Romano: We're starting to see it pick back up And I think that will continue as people get line of sight to where these rates land and understand where the valuations of the properties are.
Anthony Romano: It's funny because if people are talking about, well, the property value is down 20% And it's like you bought a stock at 10, it went to 100 and it said 80 and now you're a mess.
Anthony Romano: Well, come on, like you, you know there's still equity in these properties.
Anthony Romano: The difference between residential mortgage and commercial mortgage is they're much lower LTVs.
Anthony Romano: Right, these are 60% LTVs.
Anthony Romano: So you buy a $10 million building, you know you're coming in with $4 million.
Anthony Romano: So to get under water, to be in a negative equity situation like we saw in 2008 and nine on the Resi side really hard to do.
Anthony Romano: I do think there'll be some distress.
Anthony Romano: We're starting to see some delinquencies You mentioned it, not just the banks that have those couple of banks that have failed, but every bank is looking at their real estate portfolio and they've tightened the credit box, so that means less fits in there in terms of underwriting standards, so it'll be a little harder.
Anthony Romano: Rates are up, standards are harder, so you're seeing private lenders and other folks and you know they have debt lending and things getting into the mix to help.
Anthony Romano: Because the other dynamic is you have almost a trillion dollars over the next three years of CMBS, which is loans that have been securitized.
Anthony Romano: Those loans are coming to maturity.
Anthony Romano: And most of those loans are interest only.
Anthony Romano: There's zero interest.
Mark Haney: Yeah, for our listeners that might not be as familiar with commercial real estate, you might be thinking of your house.
Mark Haney: You get a 30 year mortgage.
Mark Haney: It's paid off at the end of 30 years.
Mark Haney: A lot of people are locked in at three and 4% interest rates and they're not really selling their houses right now.
Mark Haney: They're kind of just hanging on to it, maybe even turning it into a rental at some point if they want to get something new.
Mark Haney: But you're not gonna.
Mark Haney: There's not a lot of houses getting sold with a 3% interest rate right now.
Anthony Romano: No, i mean, you know the purchase market it's down, but on the resi side it.
Anthony Romano: You know people move and kids.
Anthony Romano: You know you get a new job and kids leave and so you buy new house and that will maintain To your point.
Anthony Romano: You have 90% of residential mortgage holders under 4%.
Anthony Romano: Rates are at 5.5, 6%.
Anthony Romano: You're not refinancing your mortgage, so refis are down 80% on the resi side.
Anthony Romano: So there's no doubt that the macroeconomy and I get the feds gotta, you know fight inflation et cetera, but I think they're starting to see the impact of lending and the tightening of the access to capital.
Anthony Romano: So you know, we'll see.
Mark Haney: But on these commercial loans like you mentioned, i'm going back to that a little bit.
Mark Haney: But what our listeners might not be thinking about is they don't own the commercial property.
Mark Haney: There's these loans against that stuff that are the balloon.
Mark Haney: Payment is coming due, so they're gonna try to refinance it in a time when the interest rates are higher so it's harder to afford the payment, and then also the banks are tightening up as well And your property's probably worth a little bit less.
Mark Haney: So you got kind of like a triple You gotta come in.
Anthony Romano: You gotta come in that scenario.
Anthony Romano: And it's not just the maturity of those, because they're normally not 30 year.
Anthony Romano: The loan products and commercial are 10 and 15 year loan products.
Anthony Romano: So you gotta come in with a lot of capital, okay, or you gotta do a transaction.
Anthony Romano: They'll.
Anthony Romano: We're starting to see delinquency up.
Anthony Romano: I think a lot of those will cure, but we will see defaults.
Anthony Romano: We will see REO transactions And for Critelligent, as bad as that is, that's all our services.
Mark Haney: Transactions are good.
Mark Haney: All our services are required, yeah.
Anthony Romano: I don't think it'll be anything like we saw, you know, when you had esoteric loan products and crazy stuff going on on the Resi side back in the day.
Anthony Romano: But yeah, it'll be.
Anthony Romano: We're navigating at Critelligent.
Anthony Romano: It's impacted us, right.
Anthony Romano: So markets down 70%.
Anthony Romano: We've seen 30 and 35% declines on revenue.
Anthony Romano: Right, we had this crazy 25% quarter over quarter growth for eight, nine quarters in a row And we've definitely seen an impact to our transactions, our orders and our top line.
Anthony Romano: So we went to the middle of the P&L like any good leadership team would do and you start to write size operating expenses.
Mark Haney: Yeah, i have to imagine I want to dive into that in a second.
Mark Haney: So you mentioned that there's a lot of money on the sidelines.
Mark Haney: So, in terms of, like, protecting the economy, people are gonna be able to come in and, you know, refi and put a little more cash into the debt, into the loan and, you know, probably minimize some of this foreclosure type of scenario.
Mark Haney: Yeah, for sure, i think it'll be a meanwhile.
Anthony Romano: I think what I see money in size.
Anthony Romano: What I see is, if you think about any and he just passed away, sam Zell was really the father of the REIT, which is a real estate investment trust.
Anthony Romano: It's a vehicle that allows you know investors to put money in commercial in different asset classes that's publicly traded.
Anthony Romano: You now have, if you think of the Goldman's and the Blackstones and the Brookfields and hundreds and hundreds of endowments and various funds have a mandate to this asset class.
Anthony Romano: That's just like they invest in equities.
Anthony Romano: This is a big asset class.
Anthony Romano: There's lots of money waiting to be deployed to buy commercial real estate And what has to happen again is line of sight to where these rates land and valuations to make sense.
Anthony Romano: So cap rates and yield make sense.
Anthony Romano: So I really think we'll see a surge in transactions as we get into the third and fourth quarter of this year.
Mark Haney: What about alternative lenders?
Mark Haney: So if the banks are tightening up, other people jump in to fill that gap, i assume, because it's a business that you can make money on even if you're a non-bank.
Anthony Romano: Many clients of ours are in that, what we call private lender.
Anthony Romano: They do these mezzanine loans, bridge loans for a period of time.
Anthony Romano: So absolutely yeah, you'll see.
Anthony Romano: I think you'll see more non-banks in the commercial real estate transaction.
Anthony Romano: You saw it big on the resi side.
Anthony Romano: I think you'll see it more in the commercial side.
Mark Haney: When you said go to the middle of the financial statements.
Mark Haney: So, in terms of solving your maybe expense, having too many expenses, what does that look like?
Mark Haney: Is that headcount or is that?
Mark Haney: I mean, how do you approach that?
Anthony Romano: Yeah, yes, I mean for the most part, when you think about from a revenue standpoint.
Anthony Romano: You sell and you can increase your prices For your COGS, you can reduce your data cost, your service cost, et cetera.
Anthony Romano: What's left is gross margin percentage and dollars.
Anthony Romano: That covers your operating expenses, right.
Anthony Romano: So the higher your revenue, the higher your margin, the more you have to cover up.
Anthony Romano: For us and it's interesting when you think about some of the venture and private equity guys that we chat with our margin profile blended with somewhere close to 50% a lot of the SaaS and software and technology guys like well, we like it 60, 65% margin.
Anthony Romano: Well, you're talking about a $10 product.
Anthony Romano: Our average revenue per order is almost $2,000.
Anthony Romano: So that's $1,000 to drop to cover OPEX, right?
Anthony Romano: So whatever is in that gross margin dollar bucket, you have to be able to cover your operating expenses.
Anthony Romano: Yeah, for us and for many companies like us technology businesses and tech-enabled businesses you got 70 to 80% of your OPEX is FTE and associated benefits and payrolls taxes associated with FTE.
Anthony Romano: So, we were fortunate in that when we did the acquisition there were definitely some cost synergies that we knew we could realize You don't need two AP clerks and things of that nature.
Anthony Romano: And then we also moved to this model.
Anthony Romano: I mentioned our panel.
Anthony Romano: We had a lot of W2 resources in-house because I was not comfortable with our turn time, our quality with the panel.
Anthony Romano: This is going back probably eight or nine months.
Anthony Romano: As that improved and we got really comfortable, we made those changes.
Anthony Romano: So we reduced our OPEX by 48%, have you?
Mark Haney: had to do this type of thing in your career before I have, and it can be painful, maybe for me just.
Mark Haney: I live a little more emotionally in terms of the people side And when you have to let friends go, that's a difficult thing Super.
Anthony Romano: I mean, there's no question that it would, particularly when you care about culture and ethos and wellness and collaboration, including trying to create a great place to work.
Anthony Romano: You can't control the external environment.
Anthony Romano: I love being optimistic.
Anthony Romano: I hate being optimistic about things I can't control.
Anthony Romano: And the environment is one where everybody knows.
Anthony Romano: We've been really clear with everybody and sort of said, hey, this is where we are, if these things happen, we'll have to make some change.
Anthony Romano: That could happen in non-FTE expense, it could happen in reduction in pay and you go to 40 work.
Anthony Romano: We've got lots of things, but at the end of the day you got to look at the leadership team and say, look, our job.
Anthony Romano: We got a lot of constituents, the employees first.
Anthony Romano: It's got big investors in this business and we've got important customers and we're going concerned.
Anthony Romano: So we've got to do the right thing And that's never easy And you do it with grace and you do it with compassion and you make sure you provide a safety net and a severance and you help people transition to the best of your ability.
Anthony Romano: But it may be more so in real estate.
Anthony Romano: I mean in a past life on the Resi side, when rates went up, i mean you had massive changes you needed to make, and the longer you wait, the worse it is for the employee and the worse it is for your EBITDA at the end of the day, so you got to get a landing spot.
Mark Haney: Yeah, that's interesting, because in 2008, we had to make my old company, we had to make some really difficult decisions along these lines too, because all of a sudden, our revenue would drop dramatically.
Mark Haney: And I have to imagine people that are I've heard that, within mortgage, you know, and dealing with residential mortgage and stuff that just being in the right spot here, you gotta find a landing spot.
Mark Haney: If you're in one of those type of positions And I wonder how artificial intelligence is gonna affect that as well, because some of these jobs might be eliminated because of that too.
Anthony Romano: For sure no doubt.
Anthony Romano: In real estate.
Anthony Romano: I think it probably is usually a lagging industry to some of the other industries.
Anthony Romano: We're starting to see adoption and people really thinking about how do we take cost out and how do we reduce the timeframe to get stuff done using these innovative technologies, using, you know, sort of natural language, et cetera.
Anthony Romano: It'll come for sure.
Mark Haney: So once you right size it then and you mentioned communication, that was my big thing I probably over communicated, because I just wanted everybody to know the truth from the CEO right.
Mark Haney: And just give it as much as I can.
Mark Haney: But now that you've sort of done all that, now you've got to communicate a growth strategy or a strategy moving forward that looks positive.
Mark Haney: What does that look like now in terms of like?
Mark Haney: what are you communicating to the team?
Mark Haney: What are you communicating to investors, customers, about the go forward plan and why it's gonna be better than it is today?
Anthony Romano: Yeah, well, i think the foundation was again the utility these clients get Watching in all of these verticals, clients really satisfied and having a big ROI with what we're doing.
Anthony Romano: So we know beyond product market fit, we know this solution set and what we're doing impacts our clients In this market.
Anthony Romano: If you think of bank, the bank was doing 10 transactions down to the June three.
Mark Haney: Still got the customer though.
Anthony Romano: Yeah, we've still got the client.
Anthony Romano: They're transactions down, but they're hurting too.
Anthony Romano: So our message has just been to our team.
Anthony Romano: Now's the time to lean in.
Anthony Romano: I mean really lean in with our clients and help them get their transactions done, get the information, make the decisions fast So that, as things recover, where you had three vendors that you used when you did 10 transactions, well, as things come back it might not go back to 10, but it might be five or six and you might just have one We might actually come out ahead from an orders and revenue perspective.
Mark Haney: Yeah, that's interesting Cause I would think on something like this.
Mark Haney: I was gonna call it land grab, but there might be a way to grab market share right, Because you're providing something that's gonna allow a bank that's maybe needs to reduce some headcount, or some other organization that's thinking about reducing headcount, And it's like look, come in with our solution and it's gonna create a lot of efficiencies for your business.
Anthony Romano: No, no, where they had four or five people in their group, and now they've got two.
Anthony Romano: They can go back up to the same volumes using our technology without adding staff, And so that's a great thing for us.
Anthony Romano: What's been the silver lining, I think, in the real estate debacle that's going on, is we can get airtime with a lot of people.
Anthony Romano: They're willing to look at new technology, new innovation, I think, in particularly commercial real estate.
Anthony Romano: I think the adoption of technology.
Anthony Romano: It will be evolution and not revolution, And so.
Anthony Romano: But they're more open now to all right, how do I take cost out?
Anthony Romano: How do I do things faster?
Anthony Romano: How do I have less FTE And how do I make sure I don't mess the experience up with my borrower?
Anthony Romano: and prove that.
Anthony Romano: And we play really well there.
Mark Haney: So, in terms of market share, do you have a sense as to the size of the market and then where you guys stack up in terms of market share, like how much is there to grab?
Mark Haney: A lot, i mean, i tell you it's probably a 15 to 20 billion.
Anthony Romano: When you look across before, during and after a transaction and all the data and analytics, all the services, all the solutions, all the platforms, it's a big market just in the commercial world.
Anthony Romano: And so, yeah, we've got 800 clients.
Anthony Romano: We wanna get to 2,500, 3,000 customers and they're in these key verticals.
Anthony Romano: And the beauty is, once you crack the code with a specialty insurance provider and you see the value they get where it took them four hours to do what you showed them how to do in 15 minutes, well, there's 38 specialty insurance firms in the country.
Anthony Romano: Now you can just propagate right through and go bring them a solution.
Anthony Romano: And we've got now six of the top 10 and we'll keep going there.
Anthony Romano: And you can kind of do that in each one of the verticals when you understand each node in the client's process, what they're trying to get done, what their alternatives are, how much they spend.
Anthony Romano: And so, yeah, we've been really fortunate there.
Mark Haney: Yeah, i would think just adding new customer, new clients, would be a big focus right now, because your product's really sticky and so just you need to collect more clients Both, i would tell you.
Anthony Romano: It's funny because we've been acquiring about 75 new customers a quarter for the last two and a half years.
Anthony Romano: Right, that's a big number.
Anthony Romano: Where I think we have a real opportunity now is we've been focused on new customer acquisition, but the entry point of each of those clients may be.
Anthony Romano: I came to you for environmental prescreens.
Anthony Romano: I came to you for appraisals hey, i wanna manage my assets here And they don't really understand the depth and breadth of what we do.
Mark Haney: So the opportunity.
Anthony Romano: I think we could double our revenue and not bring in a new client.
Mark Haney: Just wallet share expansion, Yeah, and when you're adding new product offerings within your platform.
Mark Haney: But I guess some of it's just training, just a basic understanding of oh you guys, offer that now too, You offer that now too.
Anthony Romano: Yeah, and the user and the old adage of the user doesn't buy, the buyer doesn't use.
Anthony Romano: So the somebody who's using us to place orders et cetera, that's not the individual that you talk to about adopting all the other things you do.
Anthony Romano: It's usually the head of lending or chief credit officer, depending on the institution we're talking to.
Anthony Romano: So you gotta navigate the organization And we've got tons of opportunity.
Anthony Romano: We've got big law firm client that spent $800,000 with us and everybody said, oh, it's great, these guys spend a lot of money.
Anthony Romano: So well, that was their Chicago office.
Anthony Romano: The other eight offices never heard of us guys.
Anthony Romano: Just so you know We can go horizontal in these customers in different functional areas of their business and in different locations, and expand what we're doing.
Mark Haney: Okay, we're talking a little bit about money of this on the sidelines in real estate, but venture capital is sort of a world that both of us have some familiarity with.
Mark Haney: You've raised money for your business.
Mark Haney: You guys are a venture back company.
Mark Haney: You mentioned Monetta.
Mark Haney: I believe they're an investor.
Mark Haney: I'm a small, very small time investor into the company And that world has changed at some level because of what's going on on the macro economy And interest rates going up has affected that too.
Anthony Romano: Yeah, because I mean you get yield a lot of places right Now, venture has a charter and their LPs expect, you know, something to happen over a three to five year, you know sort of period.
Anthony Romano: And you're right, 18 months ago, the discussion with either venture capital firms or private equity growth equity guys, it was very different in what they were willing to do to deploy the capital and make the investment and the metrics that they cared about you know in terms of where you were in that journey.
Anthony Romano: So it was everybody goes, oh, grow it all costs.
Anthony Romano: I don't think anybody really ever said that.
Anthony Romano: And no venture firm.
Anthony Romano: when you hear people say, oh, they're placing 10 bets and they just want one unicorn, i haven't found a venture firm in places a bet They do their diligence okay, there's no doubt.
Anthony Romano: You do 10 investments, as good as the diligence is, and you believe in the management team and the market.
Anthony Romano: Four or five of them don't make it.
Anthony Romano: And then you hope that one or two do pretty darn good and you get more than your money back, and then two or three of them you know do really well and you get seven to 10 times your money And that's how the IRR for a fund returns 20 and 30% to their investors.
Anthony Romano: So it certainly was acquire clients, grow revenue you know add users create a competitive mode.
Anthony Romano: And we were doing that.
Anthony Romano: We weren't doing it with an outlandish burn, but that was often acceptable for a lot of these venture firms to say continue to invest in the business Like it's working, it's working, and then when things turn, you're.
Anthony Romano: It's so irresponsible in my mind So you can't be positive, you know, in cash flow early stage.
Anthony Romano: It just you know it doesn't make any sense to do that, Or it's gonna take you 20 years to grow your business right.
Anthony Romano: But, fast forward to now and you know we're in the midst of some additional, you know, capital raise.
Anthony Romano: We've got folks coming to us which is kind of cool, but the things they care about are cash flow and EBITDA And you don't need to necessarily be there, but you better have a line of sight and a really clear plan to get there, because the irresponsible burns.
Anthony Romano: I mean, the number one adage is don't run out of capital.
Mark Haney: Right.
Anthony Romano: If you're in year one, year two, you have to don't run out of capital.
Anthony Romano: It's survival is all that matters.
Anthony Romano: Everything else is just words, Like it doesn't matter.
Anthony Romano: If you run out of capital and you've raised 10 or 20, you're sort of done.
Anthony Romano: Or you get to the end of that and you realize you're over a barrel.
Anthony Romano: Right, You got four payrolls left, you got a hundred employees.
Anthony Romano: Yeah, the business looks good, but you don't have the capital to continue.
Anthony Romano: And then you get into down rounds and really ugly bad stuff You got to get out in front of it with maybe it's headcount at some point or you know some option.
Mark Haney: So in terms of that, there still seems to be a lot of money on the sidelines.
Mark Haney: They want to invest.
Mark Haney: They're looking at different metrics right now.
Anthony Romano: Selective selective And I think when people ask you about when you raise, what's the process and how do you sort of think about it?
Anthony Romano: The first thing that I made this mistakes right, every one of these funds.
Anthony Romano: There certainly are some general funds, but most of them have a thesis right.
Anthony Romano: They've sort of signal to their LPs I'm gonna invest in biotech, I'm going to invest in real estate and prop tech.
Anthony Romano: I'm going to invest in companies that are cashflow positive.
Anthony Romano: We only write checks because we have a billion dollar fund of 25 million or more.
Anthony Romano: So if you're raising capital, you got to know that All these funds on their sites, for the most part, you can ask what's your criteria, what's your investment approach, what's your thesis?
Anthony Romano: So, to waste time on a lot of folks that, hey, i'm raising $5 million, great, our smallest check's 20 million bucks.
Anthony Romano: You waste a lot of time.
Anthony Romano: So understanding the makeup of who those folks are is important and we now have a group that we work with and that have continued to keep up to date on how the boats float and, over a long period of time, have watched, and I think that's the big difference between early seed and certainly series A.
Anthony Romano: Series A A for me, was aspiration We could talk about again a great leadership team, incredible domain expertise, great experience, trickle of revenue, good concept.
Anthony Romano: Here's what we're going to go do.
Anthony Romano: And people invest in that regard, right, because they will believe that When you get to series B I use B as bullshit like, hey, man, there's no faking it, it's called historical financials.
Anthony Romano: Here's my last 12 or 24 months, right?
Anthony Romano: So you can't come in and say, well, you said you were going to get 1,000 customers.
Anthony Romano: You got 500,.
Anthony Romano: You said you were going to do 17 million guys.
Anthony Romano: They ate million.
Anthony Romano: You said you.
Anthony Romano: So that didn't lie.
Anthony Romano: So now you're at the metrics in my mind where you've got to be really clear on revenue and margin and OPEX, ebitda and cash flow and, yes, ip and yes, users and yes, nps those matter, but the financials are where these guys are at And then what can this become?
Anthony Romano: I mean there isn't.
Anthony Romano: These aren't affinity investors, right, all the.
Anthony Romano: They have LPs that want to return.
Anthony Romano: So they have to believe that over the time horizon of their investment they're going to get a real return.
Anthony Romano: And knowing that, you know, is super important.
Anthony Romano: I mean matters in the conversations, in the pitch decks, great, but the real work starts when they start with diligence and look at cap tables and proformas, historical financials, revenue cohorts.
Anthony Romano: I mean there's just a lot you got to be prepared to have an adult discussion about and come out the other end.
Mark Haney: It's interesting that you're bringing this stuff up, because these are sort of big boy type of or big girl I should say you know big.
Mark Haney: They're deeper discussions, it's real business.
Mark Haney: A lot of the startups that are, you know, in the very early stages they're kind of product people.
Mark Haney: Right, they've built this cool product, they're organizing the business and they haven't necessarily sat at the helm of a company.
Mark Haney: That's you know your size or the size of the last companies that you have built.
Mark Haney: And how important is that experience?
Mark Haney: I mean, can you get the on the job experience in most cases?
Mark Haney: or I mean because you're in the fire if you're a startup, but I mean Crutelsian's lucky to have brought you in from the outside and you know a professional CEO, yeah, i mean.
Anthony Romano: I do think.
Anthony Romano: Thank you for that.
Anthony Romano: But I do think that the product folks and the engineers and the technologists that have you know the chops there if they surround themselves.
Anthony Romano: I mean I was really fortunate with you, with Lukash We go down the list of people in this region who helped and leaned in and helped navigate that process a little bit.
Anthony Romano: Yeah, i had some experience but it was very helpful.
Anthony Romano: I think that exists for a lot of your portco's right now.
Anthony Romano: You'll be with them by their side as they go out and have those conversations.
Anthony Romano: But to be prepared, you know you're going to get caught flat-footed.
Anthony Romano: There's no question with private equity guys doing diligence.
Anthony Romano: But you can only get caught flat-footed on the same question once, right, when they talk about subscription models, when they talk about revenue cohorts, when they talk about margin profile, you can get flat-footed once.
Anthony Romano: But then you got to be prepared because the next firm's going to ask you that And that's what matters to them and how they look at how much they're going to invest.
Mark Haney: Yeah, okay.
Mark Haney: So let's talk about the relationship with a company like Monetta.
Mark Haney: And if they're your lead investor, what kind of well, what's the expectation of someone like from you, of how they might help you navigate getting that next round, or helping you prep to scale the business?
Anthony Romano: Yeah, i mean they have a lot of portco's and many of those, as you know, have been wildly successful, not only in terms of where they are in their journey and their growth, but big, big exics.
Anthony Romano: And Monetta's team is fabulous.
Anthony Romano: They've been massively helpful.
Anthony Romano: They help with investor briefs and executive summaries and pitch decks and all of the diligence, building a data room and how to be well-organized, and they've been very, very helpful.
Anthony Romano: I'm super fortunate our CFO, chris Arell, is you know, mba from USC Price Waterhouse.
Anthony Romano: He's the young guy, but beyond that, he's got the chops to build models and build data reports.
Anthony Romano: That's what these investors want to see And if, again, it's in that aspirational stage, it's what we might do.
Anthony Romano: If it's what you did, you've got to be able to put that in the right context, for here's what happened, here's why it happened and here's where we're going with it.
Anthony Romano: And so, having a really good investor and a really good leadership team you know who's particularly in the Fayette side.
Mark Haney: Yeah, yeah, you know it's interesting because when we decided to start the growth factory, i made three calls One to Dale Carlson, who you know sleep train guy, so you know, philanthropic man and just a great business man.
Mark Haney: He was the first call and he's like how do I help Mark?
Mark Haney: Second call I made was Barry Broome, who does all the economic development stuff around town at GSEC.
Mark Haney: And the third call I made was to to LoCache from Monetta Ventures.
Mark Haney: The three people that I felt I respected most in this world and could help give me some feedback on our dream.
Mark Haney: And all of them said the same thing What are you working on, how can I help?
Mark Haney: And so, like Keshe and Monetta has come on as a you know, a formal advisor to the Growth Factory Ventures Fund And it's like having, like, my teammates are great.
Mark Haney: You know, i've had some experience angel investments, doing angel investments, but having LoCache and the Monetta team sort of there as our sounding board with guidance has been invaluable.
Anthony Romano: He's been.
Anthony Romano: I mean, they were entrepreneurs that learned how to be VC, so they sat in our chairs.
Anthony Romano: they get it, which is, which is beautiful.
Anthony Romano: They'll be winners in a big way out of this And I'm so grateful for that relationship.
Anthony Romano: They're, i don't want to say generalist, but when I think about now what we're looking, the funds that we're talking to now, all of the LPs of these funds are commercial real estate holders.
Mark Haney: Interesting.
Anthony Romano: They're, in other words, it's more than just capital.
Anthony Romano: Now It's.
Anthony Romano: They can bring strategic value in customer relationships, business partner relationships, right, so does that make sense?
Mark Haney: The LPs of the funds that are investing in you.
Mark Haney: So, just so our listeners know that when somebody has a fund, they have, let's say, 100 investors, and these people are the minority share.
Mark Haney: They all own part of this investment, and so it could be a big group of people.
Mark Haney: So a friend comes in right, the general partner, they make that investment, but then each of the people that are investors, they can add value, no doubt, and you can tap into those people.
Mark Haney: The individual LP limited partner who makes an investment can add value.
Anthony Romano: Also the firm.
Anthony Romano: So many of the private equity guys we're talking to today.
Anthony Romano: Their investors are CBERE, cushman and Wakefield, heinz, hilton, walmart, folks that have a giant commercial real estate footprint, the biggest multifamily owners, the biggest warehouse and storage owners.
Anthony Romano: So those folks all make investments and they can introduce you because part of the private equity guys want to see hey, is there real value in your product?
Anthony Romano: Let's go talk to some of our LPs and see would they use it?
Anthony Romano: And so far it's been really good.
Mark Haney: That's great.
Mark Haney: We're going to grow the business and it's through your advantage.
Mark Haney: That's part of the advantage.
Anthony Romano: So you say hey, can you bring more than capital?
Anthony Romano: Can you help me with pricing and packaging and subscription model?
Anthony Romano: Can you help me with business development and relationships?
Anthony Romano: You guys really understand acquisitions and talking acquisitions And those are the kind of firms that we're talking to now That becomes really valuable.
Anthony Romano: There's many kind of vertically integrated commercial real estate companies that have started venture arms.
Anthony Romano: So think Prologis, divco, west, bh3, brookfields.
Anthony Romano: They all are big commercial real estate players, that's what you'd think about.
Anthony Romano: But they all have hundreds of millions of dollars in growth equity capital that they take bets on in companies that can impact their real estate business.
Mark Haney: Which makes sense.
Mark Haney: Did you ever meet the guys from Hank?
Anthony Romano: Yes, In town They have a.
Mark Haney: They sold the JLL Yeah yeah, they sold the JLL And that's part of their venture arm, but yeah, so that guy's been on the show.
Mark Haney: I was an investor in that company as well.
Mark Haney: So, yeah, it's interesting to think about the different synergies that they can pick up by buying that type of company.
Mark Haney: It could be someone like you or someone like Hank Very cool And that's kind of part of the backyard advantage thesis is that we can get our limited partners from the growth factory.
Mark Haney: We can get the partnerships that we have with cities and counties and the kings and colleges and universities to be early adopters to some of these startups.
Mark Haney: When they start to get their first customers, hey, let's strap the product a little bit, let's be an early customer and get them a little bit of capital.
Mark Haney: At the heart of what we're doing is bringing love.
Mark Haney: So, if we can in ours are all Sacramento, so it's sort of interesting because we're in this little fish bowl where we all kind of know each other because it's a small town And so we're thinking that that actually can be an advantage And we've seen some of that begin to happen for our portfolio companies and for other friends that are coming through our networks as well.
Mark Haney: So, tons.
Anthony Romano: This region's come a long way in the last several years And what you guys are doing is a big part of that in terms of entrepreneur and business and things of that nature.
Anthony Romano: But the introductions that we've had I mean so banking relationship back within RISO Not only have they been great advisors, but they've been five-star bank.
Anthony Romano: Yeah, five-star bank And they're a great customer of ours.
Anthony Romano: And look, they're not going to use us because we're their buddy.
Anthony Romano: They're going to use us because they get great value in utility And then they're going to tell other people about it.
Anthony Romano: So we've been the beneficiary of the region and these relationships have been cool.
Mark Haney: That's really cool.
Mark Haney: OK, so I want to talk about you as the CEO.
Mark Haney: You got recognized by Ernst and Young as being one of the top CEOs.
Mark Haney: What happened?
Mark Haney: What was that all about?
Anthony Romano: So Ernst and Young, i mean I think most people think of them as tax and audit.
Anthony Romano: They're a world-class, one of the most iconic professional services firms in the world, headquartered in the UK.
Anthony Romano: They spend, they have this whole entrepreneur of the year program And they spend a lot of time, much like you, but in a different form of fashion.
Anthony Romano: They've got a lot of people dedicated to how do we impact communities, entrepreneurs, small businesses.
Anthony Romano: They actually do a lot in venture and things And around the country they do these entrepreneur of the year type of awards.
Anthony Romano: So yeah, you know somebody nominate you.
Anthony Romano: You write five or six long essays, you answer a bunch of questions, you set out financials.
Anthony Romano: They had folks come up to Sacramento.
Anthony Romano: You spend 90 minutes in an interview.
Anthony Romano: Then they start with whatever 1,000 people And they narrow down to 70, 80, 90.
Anthony Romano: You go down to Palo Alto.
Anthony Romano: You're doing these interviews with private equity and they're kind of advisor guys.
Anthony Romano: And then they narrowed it down And it was really super humbling because the people that I was with I think this is Silicon Valley.
Anthony Romano: I mean some of these guys are curing cancer, putting shit on the moon.
Anthony Romano: I mean it was unbelievable in terms of the businesses, really blockbuster businesses So very humbled and honored And they got it down to 29.
Anthony Romano: And I think they picked four or five to go to the national Critellegeant and I wasn't one of them, but it was still.
Anthony Romano: It was some really cool event that happened earlier in June out in San Francisco And yeah we just appreciated the opportunity.
Anthony Romano: I mean, for me it was less about the Anthony Ramono brand.
Anthony Romano: But how does Critellegeant and we've had investors come, we've had business partners, data providers You just elevate the business and what we're doing And more people are like let me talk to those guys.
Mark Haney: So we got a lot of guys.
Mark Haney: Yeah, you'd be the CEO.
Mark Haney: It's your job to be at some level in the face of the brand and move the molecules in all these different ways, and so that's a good group of people to be around.
Anthony Romano: It was great.
Anthony Romano: Yeah, the whole process was really fun.
Mark Haney: OK, so what did I not ask you?
Mark Haney: What else do you want to talk about today?
Mark Haney: What's important to you right now?
Anthony Romano: I think essentially, i love this region.
Anthony Romano: We've been, so again, big beneficiaries of it, not only with business partners and investors, but employee base here has been amazing And in these kinds of times you've got a lot of companies that are doing massive cuts and changes And our feeling has been look, you could buy people's back with earnings and bonuses and stock options, but you can't buy their heart, and you've got to create a culture and a foundation that really is honestly matters, where people say I want to be part of this And part of that is what we're doing.
Anthony Romano: Like I want to have my fingerprints on something that is really impactful that's going to blow it out, and I think that we've got a lot of people in the org right now that are pretty excited about where we're going.
Anthony Romano: And when you're a venture-backed business, it doesn't always mean you sell the company.
Anthony Romano: There's recapitalization, there's IPOs, but there's an end to this.
Anthony Romano: And so our leadership team has said, hey, we want to run really hard over the next 24, 36 months And then we'll see.
Anthony Romano: I mean, we'll have acquired a lot of clients.
Anthony Romano: It'll be a competitive boat.
Anthony Romano: The platform's there.
Anthony Romano: We've had two or three firms come to us and say, hey, we're really intrigued with what you're doing.
Anthony Romano: We're just in an adjacent market.
Anthony Romano: What do you want to talk about?
Anthony Romano: And it's early yet, and so we'll have more of those conversations in the next couple of years.
Anthony Romano: But yeah, it's been really exciting to see it grow and succeed.
Mark Haney: All right.
Mark Haney: So last question I got to add one of the things that you and I have in common is we're family guys, right?
Mark Haney: So we're talking about your daughters And they've gone off and got their degrees at great schools And they're getting good jobs, And you and your wife have been married along.
Mark Haney: How long have you guys been married?
Anthony Romano: We took her to sophomore homecoming dance in high school and been together ever since.
Mark Haney: Yeah, i knew it was like forever And not that you're that old, but it's like it takes a while But it's interesting.
Mark Haney: So any words of wisdom for that?
Mark Haney: Because you see there's a decline in families at some level And so I always feel like when I meet someone like you, i want to help bring out that story a little bit about look, you did some things right.
Mark Haney: What?
Mark Haney: Any advice to men out there or anybody?
Mark Haney: Well, i did not, because your kids love each other too.
Anthony Romano: I thank you for that.
Anthony Romano: I did a couple of things right, my wife did a lot right And you're absolutely right, we're super blessed.
Anthony Romano: Olivia and John and the daughters are their best friends And I've never seen them fight And they share everything And it's such a unique scenario But it made it really easy.
Anthony Romano: My wife I was unencumbered.
Anthony Romano: I mean, she did a lot.
Anthony Romano: I traveled a boatload when I was pre-cretoligent and tried to never miss school and recitals and games And I was a coach.
Anthony Romano: But what happens then is you don't ride your bike as much, you don't fly fist as much, you don't work out as much And that's OK Because that's where you are in the season, if you will.
Anthony Romano: But I would give a lot of advice around balance to guys or gals that are in these kind of roles, because it will take as much as you can give.
Anthony Romano: There are 80, 90 hours a week And when people say, oh, i worked 80 hours, let me tell you what really 80 hours looks like.
Anthony Romano: It's like 12 hours a day, seven days a week And you're on.
Anthony Romano: Right, you're on, And so that's real.
Anthony Romano: If you're not eating right, If you're not sleeping right, If you're not exercising, you're in trouble.
Anthony Romano: In my mind, I think those things when you look at mental, emotional, physical health.
Anthony Romano: You got to own that Because it's not easy, And you got to have emotional endurance.
Anthony Romano: That's going out of style In the fundraising world.
Anthony Romano: You better fall in love with the word no.
Anthony Romano: In the last two months I've talked to 90 firms 90.
Anthony Romano: We've got seven or eight of them that are really going deep with us.
Anthony Romano: So, it's a process And you've got to play the long game and be in it marathon versus sprint.
Anthony Romano: But that lifestyle balance and still taking care of yourself is super important so that you can go, so that you can go hard.
Mark Haney: Well, it's interesting Making a good decision.
Mark Haney: That's the thing about the decision you made to marry your high school sweetheart.
Mark Haney: That can go good or bad, but that decision.
Mark Haney: It's amazing how important that decision is.
Mark Haney: Because you get that one wrong, the rest of it crumbles.
Mark Haney: I mean, some people aren't going to back the 12-hour day person, they're not going to tie in with the same values that you have to bring the family so close and unified.
Mark Haney: They're not maybe going to have that same health aspirations for themselves and for your family And so great decision, thank you, yeah, super.
Anthony Romano: And I'm surrounded by a leadership team, chris and Toby Lutz, who you know, and that are the same.
Anthony Romano: They've got from the same people The clock all Sac State grads, by the way the whole entire executive team, all.
Mark Haney: Sac State grads.
Anthony Romano: And also have those same values of balance and family, and it makes it easy to navigate the business together.
Anthony Romano: I love it.
Mark Haney: Well, congratulations on your success And I look forward to seeing what the next few years look like and the growth of Crotellogen And anything I can do.
Mark Haney: You know I'm here for you.
Mark Haney: Right.