Adam Torres and Travis Jamison discuss CaptialPad.
Subscribe: iTunes / Spotify
Apply to be a guest on our podcast here
Show Notes:
CapitalPad is changing the way accredited investors source deals.In this episode, Adam Torres and Travis Jamison, Founder at CapitalPad, explore Travis’ journey as an entrepreneur and CapitalPad.
Watch Full Interview:
About CapitalPad
CapitalPad is a platform connecting accredited investors with deal sponsors who are acquiring an existing SMB. We connect search funds, independent sponsors, and ETA acquisition entrepreneurs with pools of accredited investors who want to build a portfolio of small businesses.
Hey, I’d like to welcome you to another episode of Mission Matters. My name is Adam Torres, and if you’d like to apply to be a guest in the show, just head on over to mission matters.com and click on Be Our Guest to Apply. All right, today I have Travis Jameson on the line, and he’s the founder over at Capital Pad.
Travis, welcome to the show. Hey, thanks for having me. I liked your intro here. It’s got very like b, b, C vibes. It’s good. Come on, man, I’m in. So, Travis first off, we got a, we got a lot to talk about today, so I definitely wanna get into Capital Pad. How it’s simplifying fundraising for SMBs and also for accredited investors, how it’s helping them get.
Access to deals that maybe they wouldn’t otherwise have had. And also your background, like how, how’d you get started in this, like the private equity or the deals you were doing prior to even Capital Path. So we’ll get into that and more. But before we do, we’ll start this episode the way that we start them all with what we like to call our mission matters minute.
So, Travis at Mission Matters, our aim and our goal is to amplify stories for entrepreneurs, executives, and experts. That’s our mission. Travis, what mission matters to you? I think that small businesses really drive life improvement for a large part of our planet, whether it’s people building the businesses, buying them, or investing them, all that.
Mm-hmm. I just think it’s been really difficult for throughout history for people to build small businesses, and so I’m trying to make that easier for everyone. Awesome. Love bringing mission-based individuals on the line to share why they do what they do, and really what we can learn from them so we all grow together.
So, good stuff there. Let’s go, let’s go earlier in your career, before we get into Capital Pad and, and what you’re doing present day. Like where, where did this concept of helping small businesses or investing or just business in general, like, where’d all that start for you? Yeah, so I, I definitely did not start off as like a finance guy.
Started off as a little like tiny micro entrepreneur. Yeah, I just wanted to build something to get more freedom in my life. You know, like the traditional corporate path wasn’t really for me. And so I started building a small business and I really just wanted a small amount of money to go live.
Passively on some little island in Thailand and retire at a young age. And I did that. And then pretty quickly, what was that business? What was the early business? Oh, I was the other earliest one was in the SEO space and then the space at the same time. Little, little tiny ones. And I did it for a while and then like a year into it I’m like, well, this isn’t actually.
What I thought it was gonna be, I don’t wanna retire age 24. Maybe that’s a bad idea. And so then just started building more things over time. Kind of used the stair step method where you use the profits from one business, either like the actual cash flow or you like sell it to then build something bigger and really fell in love with the, not as much the money part of it, although that’s nice, but more just like the building part of it.
Like interesting, we’re focus on these building these things. So I ended up building a quite a. The large portfolio of different companies been in everything from services to e-commerce, to physical goods SaaS. Wow. Software was my largest exit. SEO company, communities, newsletters, like absolutely everything you could think of.
No rhyme or reason to them. They don’t, not in the same, how did you, how did you use to source these ideas and be like, this is the next thing. Was it just you and Thailand talking to a buddy? They’re like, Hey, here goes this, or you’re just hanging out and all like, how’d you source these ideas, man? I don’t think I sourced them from anywhere in particular.
I, I will say that some of the early communities that I was in, one particularly like the, the Dynamite Circle is the name of it, still around, still Awesome. Still in it. Mm-hmm. That crew, I ended up meeting them in Bali randomly, and they kind of really changed my life. I think. Wow. I think that interacting with others in.
In the space. And when I said space, it’s not like one industry. It’s just like people who are thinking for themselves and trying to build stuff like that really opens up the flow of ideas. And so again, my ideas didn’t come from anywhere. They, yeah, they weren’t related or anything. It’s just you just think of them and being around others like that make it.
Way more easy to execute. Like it’s kind of normal, like, oh, I think I might do this thing. And they’re like, okay, well go do it. Tell me about it next week, what you’ve done. Yeah. What, what were their mentors or like whether in this group or otherwise that to even to execute on that stair step method you were talking about, to roll that cash over, that exits that cash flow, however you’re doing it.
Like easier said than done. Right? Like, like how, like were there mentors? Like, how’d you, how’d that work out for you? Yeah. Yeah. So I’m really simplifying this is like a, you know, a over a decade process of building these things with lots of a decade’s. Not that long though. FYI, right? Like not nowadays in the entrepreneurial world.
A lot happens in a decade. Yeah, it does. Yeah. In 10 days, let alone a decade. Right. I was on a podcast and where like the title of it was actually the 10 year career. And, you know, entrepreneurs can have a 10 year career and kind of like do it, but I think we’re fitting in like 30 years worth of work into a decade.
Yeah. And look, honestly, I’m not, not exaggerating. I agree. Yeah. But no, those, those guys from the community were actually kind of mentors. Like, not exactly like, not like an official role, it’s just. It’s just like expanding what you think is possible of hanging out with entrepreneurs. So I, I can’t recommend enough to just hang out with other entrepreneurs and I mean, I even started a community of my own specifically for that to hang out with other entrepreneurial investors instead of like, my circles just for.
Entrepreneurs. I started, started one called Snowball for entrepreneurial investors to just like expand your mind of what’s possible instead of just like s and p 500 s and p 500 s, P 500 kinda expand to like, oh, there’s a lot of other ways to make money with your capital out there. Mm-hmm. At what point was it, was there like a defining moment?
Was it a buildup? Like how did you at some point go from building these businesses which started small and then you know, got larger and getting your feet wet in all these different industries? Right, because you were, I believe the way you make it sound your. We were pretty agnostic. You went after what you thought was gonna work, make you some money maybe, and or whatever interested you, whatever your process was.
But at some point you decided to kind of move into the, to the finance side and think about raising capital. Like how slash when did that happen? Was it a moment or was it a buildup? How’d that happen? Yeah, so I didn’t, to be clear, I didn’t start raising capital to mm-hmm. Till the very end. But so I had several ex, I sold several of my companies along the way, and some of them were, were tiny.
Some of ’em was like a hundred thousand dollars one, and then they went on up. So I had like six exits, something like that. And eventually just had enough capital like it made sense to just start allocating. And so I took my existing companies that I still owned and kind of put more like a management teams in place.
So I’m not necessarily the CEO, I’m still involved, but not like heavily. They kind of run it. And so it just freed my time to start allocating this capital. Different things ended up going to like. Investing in just like every asset class you can imagine. Obviously more of the traditional finance like everyone else, which is, you know, a very good pillar for everyone’s finances, but then also in some more of the alternatives.
And when I say alternatives, I don’t necessarily mean like I. Investing in sneaker collections and Pokemon cards. Yeah, like I don’t really believe in that. That’s more speculation, but some of like the venture capital stuff, the real estate stuff, the private equity stuff, and started going through there.
And then slowly but surely, kind of more of like, instead of adding more and more, I whittled away things that didn’t align with what I think makes sense in the world. What I think produces the best risk adjusted returns. And it kind of ended up where I am now, which is in. Small business, which I’m happy to tell you, like why I think that’s the, the case.
Yeah. You’re the boss. Well, why, I mean why, like, why, why, what led you to it? Like what, what, what was that moment that you’re like, small business needs this? Yeah, so I think real, so we’ll go over a couple of the assets real estate. I, I don’t love it. But I would never really be against anyone who does love it.
But I think the returns aren’t that great. Overall, it’s very much like a leverage play. And we, as we’ve seen the past couple years with interest rates going up, like a lot of real estate plays just got destroyed. Yeah. So that, that’s the play and it’s a such a very sophisticated market to where everything’s down to the, like the, you know, single percentage cap rate movement and stuff like that.
Mm-hmm. I’m not a real estate guy. I have nothing to add from the venture capital space. It’s, it’s very interesting and it’s exciting and it’s kind of sexy. But I honestly don’t think the returns are that great. I think historically they’ve been really good. Mm-hmm. But I think so much capital has entered a space that has like a confined amount of ability to deploy that.
Mm-hmm. That the returns have been just like diluted away. Traditional private equity I still think is really, really great. I think part of that was a lot of a leverage play too with interest rate stuff. Mm-hmm. I still very bullish on that long term, but the thing that. It ended up just really making the most sense to me was going back to small business itself, which is where I made all of my money and pretty much my entire friend network and like base, like they all made most of their wealth from entrepreneurship.
And I think most people in the US have it too. Like you go to a, a country club around here, ask somebody why are they here? How do they make their money? Like nine outta 10 of them had some small boring business type of thing. Yeah. Now the question from the investing point of view is like, how do you invest in that, right?
Mm-hmm. That’s been the difficulty. You can’t just, but this guy at the country club has like a dumpster service historically. You couldn’t just go and say, oh, can I like buy 10% of your dumpster service? Like, yeah, you, you can’t really do that. And so I. When I de, I naturally kind of like poking in this space, like how do I build a diversified portfolio of passive, small business investments and kind of found this what is like the search fund and an independent sponsor space, which is where I’m investing in now.
Yeah, a long way to describe that. So when you were first getting started in that space, like how did you get into deal flow? Like, like take, keep, stay in the early days, just a little bit longer of that space, like you’re making those initial, those initial investments. Like how were you making some of those decisions?
’cause I’m guessing, I mean, I, I don’t know this, but I’m guessing they weren’t all winners, right? Like there’s different things that happened in some companies, like Yeah. In small business When you first started investing. Yeah. When you first started investing. Even before Capital Pad. Okay. Yeah. In, in the small business space, it’s, incredibly difficult to get access to good deal flow as I Yeah, that’s what I’m getting at. Like deal flow is not easy. Like you said, you can’t just walk up to the dumpster guy and say, Hey, how much are you making? Is it a good business? I on in like it doesn’t work that way necessarily. Yeah. I first I think very few people even know it’s an option.
Some, some people have heard of search funds. Fewer people have heard of independent sponsors, and I guess I should probably define these for people. Yeah. There are three different types of we’ll call investment types. Mm-hmm. In this like small business SMB space, one is called the traditional search funds, and this is what people have heard of.
A lot of these come out of like the, the Ivy League MBA programs and stuff like that. And traditional search fund is, you have some. Talented individual and they’re gonna raise a little bit of money from people to go and search for like a year, maybe two years, to find this company to buy. And I say company, maybe it’s like worth 10 to $20 million company.
It’s a historically very profitable, kind of boring company. And they find it, and you know, the person selling, it’s probably retiring is the. Traditional avatar, it’s not always the case. Mm-hmm. But that’s traditional avatar. Maybe it’s a little machine shop or an HVAC company or a little plumbing company or anything like that.
Home service, you, you never know. And so they go and buy that. And once they find it, then they go back to the investors and, and the investors chip in for the rest of it. Now the person who found it and bought it, they get a meaningful chunk of the equity for that. Yeah. They’re now partial owners and the investors own the rest.
So that’s the traditional search fund. Mm-hmm. The self-funded searcher way. Which is become way more popular last year. It’s like the ETA space, like entrepreneurship through acquisition. A lot of people heard of. It’s kind of the same thing except just one person. They go, or one person and a team of people, they spend their own capital and time.
Sometimes it’s part-time, sometimes it’s full-time office savings. Mm-hmm. And they go and find the business. They diligence it, they get it ready. They put in the, the LOI. They get accepted and then they go and raise the last little bit of money. A lot of them are using SBA loans combined with finding investors like myself to invest in it.
Mm-hmm. And the last group is like independent sponsors. Those are frequently former private equity people. Who decide to go out on their own. And so they’re also called like Fundless sponsors. Or as mentioned before, like they sometimes call them fundless sponsors. Yeah. Because they don’t, they don’t have a lot of fun at first.
It’s kind of, it’s kind of a hard job. It sounds difficult. So they, they essentially go out on their own, find a big deal, put it together, they find, you know, they put a CEO in place, they raise the capital from investors and these are much bigger deals frequently. Mm-hmm. And they earn a percent of the upside with that.
Mm-hmm. So those are the three different types of kind of investments in the SB space. That was a long description. Sorry. No, that’s very good. That’s very good. No, ’cause this is nuts and bolts like learning. We’re getting a lot done here. Continue, by the way. Yeah. This is great. But, so the whole point of this was like.
How did you find these deals? Yeah. First, once you know this space even exists, then you, you know, start talking to friends, looking on forums and stuff like that and it’s quite difficult. So I started Sounds like it talking to, because first off, you have an exceptional network, just even based off of what you were doing before you were natural or if it was or was not natural.
You were part of communities. You had a great network of entrepreneurs that you’ve worked with. You built businesses, you sold businesses, so you were already kind of in that worldly space. If you’re just, you’re corporate, you worked, I’ll think, I’ll pick on myself for a moment. When I was a financial advisor, when I was advising in very traditional asset classes, and when I was managing money there, I couldn’t just like pick up the phone and be like, oh yeah, by the way, I’m looking for this.
That I didn’t, I didn’t have that network. So for the corporate person, I was 100% outta luck and I was even in the investing business. Yeah, so just throwing that out there. So go ahead. Yeah. And to make even worse, there’s also a divide between what we’ll call like zero to one entrepreneurs think more startup people, and then people buying the businesses in the ETA entrepreneurship through acquisition space.
Yeah. There’s like, there’s a big divide. They’re not the same people, nor should they make by the way. Yeah. So just through hustle over time, I started getting access to enough of these deals. Like there’s no easy way, you’re just kind of networking and being on forums and talking to people for sure.
Stuff like that. And, started finding some of these started investing in these myself like several years ago. The returns on these are just incredible. So Stanford, it actually puts out a annual search fund study, and you, you can go and look it up, like it’s completely public. Mm-hmm. And the, the returns of search funds are just astronomical.
They’ve been, the average is 30. So you have 35 or 37% I rrr returns. Mm-hmm. That’s the internal rate return. You know, basically like your annual compounding return rate is like. 35%, which is Wow. You know, for any asset class is unheard of. The failure rate is relatively low. Mm-hmm. Now it’s, it’s certainly higher than say, like a public company, but infinitely lower than you know, venture capital, for example.
Mm-hmm. Mm-hmm. But it kind of works with the return profiles of these. Yeah. So started investing in these and. Eventually enough people of my friends were like, dude, these, these deals are amazing. Like, can I invest with you? Yeah. And started having them tag along and it kind of like. Led to the formation of Capital Pad eventually, but we can go wherever direction you want regardless whether it’s capital, in this case, in Capital Pad, or if it was somebody when, I love when somebody, an entrepreneur is out there, there’s a problem.
They’re kind of solving it for themselves. Maybe they stumbled upon it like even, even our company. I’ll, I’ll like before COVID. We all, it was, we were more, I say 90% media brand and then 10% book publishing. It was just something that, it was, it was our beginning where we started in book publishing it. This all started from a book.
I wrote the entire company. So now what becomes interesting to me is during COVID, that that’s when people start asking us, Hey, can you help us start a podcast? And I was like, no. But then I thought about it and I’m like, I’m not traveling. We got our, you know, some of, there’s some bench time that’s available.
Yeah. We’ll be upfront and tell people, you know, we’ve done, we haven’t started it for other people, but we’ve done it for ourselves. Obviously that’s why you’re coming to us. And now to date, we’ve launched over 200 shows for, for businesses and for other companies outside of even our platform. And the agency side on the backend is, is, you know, it’s meaningful.
And what’s interesting about that is that was all just based off of us solving a problem. Like that was it. We didn’t, we weren’t even go. We weren’t even gonna be in the agency business. It wasn’t even a thing. So for you, when I hear this story, I’m like, it is amazing. So you’re out there just investing for yourself?
You’re still talking. I can see. I can, I wasn’t there, obviously, but I can hear the conversation. Like you’re talking about it. You’re showing the deal. You’re there. I’m on this one. I’m on this one. They’re like, dude. Come on. Like how do I, like, okay, you’re telling me about it, but how do I get in? And then, all right, so now I think that takes us almost, or if I’m not there yet, let’s go present data capital path and you get the idea what’s next.
Okay, one second. I know you’re trying to interview me, but can we rewind? Can you tell me how you’ve launched 200 shows and what you do for people? By the way, anybody watching this, he didn’t ask me to tee him up like this. I’m just really, yeah, I’ll just say, I’ll just say I, I was interviewing people just like this and then they’re like, wow.
Like, okay. So I’ll give you an example at Travis, and this is how many shows have you been on? Roughly? Roughly? Because I know you do ’em. Yeah. Like 50. I don’t know. So, okay, you’ve been on 50. Let’s just say that. Out of those 50, and I’m not calling them out and you don’t have, this is rhetorical. Mm-hmm.
There’s probably a certain amount of those that you’ve been on where you’re like, this is different. Most when somebody comes in our show, sometimes they have that feeling and they say, this is different. And then they, and then they start asking questions, and then they’re like, Hey, can you help us launch a show?
Or can you, they’re just, it’s just different. It’s attraction. They feel different. Our processes, my backend, I come from finance. So I built the back end of this company, like a financial advisory firm. So why is the process and the distribution and everything different? Because it was built like a financial advisory company, so I wasn’t from the media space.
So when you even come on this show, it feels different, the back end, the process, the design, everything else, and you’re like, wait a minute. This, how big is this company? How small is this company? How is this so based off that, it, it, I don’t wanna say it’s fomo, but it’s just like, if somebody was thinking about it, if you were thinking about it, if you don’t already have it all set up and tweaked or perfect the way you want it.
We’ve had people that come on the show, they’re like, man, I have a podcast. And it’s not like what you guys are doing, can you take over? Like, and we can now we can say yes, but that’s the long and short of it wasn’t a plan, it was just us trying to be better for our audience. We, our processes got better over time.
We’ve been in the business now going on a decade and so over, and I’ve done over 6,000 interviews, so. You look at the processes that even just that production does, now you add the other shows and then it becomes interesting. So that’s the, that’s the long and short of it to where it’s like, it’s like, so that, that’s how it happens.
And then people, more people come and then we say, okay, well let’s, I. See. Alright, that’s, that’s a great answer and I’m gonna be talking to you afterwards. Circling, oh man. Circling back to capital pad. But yeah, so now, so now you’re at, you got the idea and now it’s about time to maybe to launch or you’re thinking about putting the platform together, like what’s the vision?
Where do you go from there? Let’s go into the problem we’re trying to solve. Yeah. So, first of all, the capital pad’s like a two sided marketplace. So if, if somebody’s familiar with like angel list, which is, you know, a place you can go to invest in venture capital deals, capital pad kind of rhymes with that just for the small business space.
Mm-hmm. But because the two sided marketplace, I kind of identified the pain points for each side. So on one side there’s this group of searchers or sponsors as they’re called. Essentially the people who are buying these companies, again, think of somebody buying a. HVAC company worth 10 million bucks, right?
Yeah. The way it generally works is they find the company, they’ve diligence it, they’re ready to go. They’re, they’re talking to like loan brokers to get like the, the debt piece of the acquisition lined up, and then they’ve gotta find investors. And so they scour the internet, they scour the forums, they get all these contacts, and they send like, you know, a hundred, 200 cold emails and then they’ve gotta send an NDA for each one, which is accepted in this space, not in the venture space, but in this space is normal.
Mm-hmm. Send an NDA. Then hop on a Zoom call for each one, and then eventually, hopefully they find enough investors to do it. And then when it comes time to close, they’re sending out a million different like operating agreements and like contracts to sign, and then a dozen different wires from different places.
Once they’ve closed, they’re sending like different tax returns and like distributions. It’s. Fricking mess. Yeah. So capital Pad, from their perspective, is one place they go, they post the deal. Mm-hmm. If it’s approved by us, which, you know, we’re very, we curate heavily. If it’s approved now, the whole process is automated.
We send it to a bunch of investors. Mm-hmm. They see a teaser. They sign an NDA automatically, then they get access to a full interview, a full deal room, simplifies it. If they wanna invest, they click the invest button, we wrap everybody up into one entity and they invest it there. So from the sponsor perspective.
That’s what we’re solving for. Mm-hmm. From the investor perspective. So to be clear, it’s only for credit and investors. Yes, yes. Yeah. Very clear. Only credit investors, accredited investors instead of not being able to get access to these deals, which is, you know, the hardest hurdle. But then once they.
Did like the, the presentations were everywhere. Again, you’re having to do with so much back and forth via email. Yeah. It’s non-standardized terms. You don’t really understand the governance. If you’re not in here, you don’t how to build in investor protections. We’ve kinda like streamlined all of this.
So now it’s just a platform. People log in, like whenever there’s a new deal, they get it sent to them. They log in, they see the teaser, they like it, they sign the NDA. They get access to all the stuff they need. Yeah. They wanna invest. They put in the number, they click invest. That’s it. Wow. Totally simplified.
Yeah, this is, I want for myself and I said all along, even if I didn’t own this, I want this to exist. Yeah. For yourself, for your own investing. Yeah. There’s no other way to build a por, like a passive portfolio of small businesses. Yeah. No other way. Yeah. I wanna take this so again, there’s two sides. I wanna take this question from both different angles.
We’ll start with just for the sake of let’s start with the investor side. Cool. So investors, you mentioned accredited. What types of investors and or individuals do you feel are correct for the platform? Specifically from the investor side for the moment? Alright, so we’ve got two groups on the investor side.
First we have, well, we’ll say the big ones. The, the funds, the family offices. These are people writing very meaningful checks. Yeah. Think $750,000 or more checks. Mm-hmm. Which is. Kind of small in their space. They, they get direct access to these, you know, they just use our platform as like, we just give them the leads, essentially.
Yeah. We don’t charge ’em for it. Then there’s the like more of the, what I call retail accredited investors, which includes myself. Mm-hmm. And we’re just, you know, high net worth individuals who. Are interested in these deals. A lot of times they are entrepreneurs who, or somebody that understands small business a little bit, like someone has no relevance or no backing.
With this type of asset class, it, it’s harder to connect how these deals make sense. Mm-hmm. But if you’ve ran a business for a few years, or you know, made some money that way this, you can like see a business and you can kind of understand pretty quickly like, oh, is this something that makes sense or not?
Mm-hmm. And the, the idea is to just make it easier for those people to allocate capital to these deals. Mm-hmm. So those are the two groups that were. Targeting. Yeah. Now let’s take that same question, but let’s take it from the other side. So the businesses that are on the platform, like what types of businesses are, let’s just say appropriate, get the most value?
Like what, what are you looking for to, to, to be on that platform? The, we don’t have a hard list of things. In order to accept, we have more of a hard list of things not to accept. So we’re, we’re very industry agnostic, which is the point. Okay. Like I want a very diversified portfolio. And that’s your style too.
Like of what interests you like that because you’re building it also for what you wanna invest in. So. Mm-hmm. Go ahead. I mean, I, I thought like what is a bulletproof portfolio to me? And it’s to own. 30 different small businesses in different industries. Mm-hmm. And you know, the equivalent of that is owning a fraction of 30 different small businesses, which is what we’re doing here.
And so there’s, there’s no industry, no business model, anything. Now with that said, we, first of all, it’s only profitable businesses. Like there’s no speculation on always, is this gonna like, make money eventually? No. These are acquisitions of like, historically profitable companies. Some of them are decades old.
Many of them are decades old actually. Yeah. A lot of them tend to be more blue collar. Mm-hmm. You can think very like AI resistant type things. Yeah. Because say I. We’ve got a machining shop, rollup. Mm-hmm. Mm-hmm. Or a HVAC rollup or like pool cleaners type things. Yeah. Also a lot of like other different types of legacy building.
We’re, we’re not against software. We’ve had a software deal on here. Mm-hmm. It’s just some of those things don’t fit as much. Mm-hmm. It’s more of the blue collar thing. So we kind of thought about like, how do you invest in the age of ai? Yeah. Try and guess. You, you can try and invest in the people selling the hardware type stuff.
Mm-hmm. You can try to invest in the companies that can really be positively disrupted. You know, maybe this isn’t necessarily positive for society, but for the company, maybe they can replace half of their staff with ai. Like something like that. Yeah. Or in our case, we decide we can invest in the companies that AI won’t really affect, and that seems like the easiest way for us to like protect against this crazy future.
And so those are the type of deals that we have been interested in. Mm-hmm. The last deal we just closed was like a. Kinda like a home repair and remodeling company in New Jersey. Mm-hmm. That was the one we just closed on, so. Mm. And for these for these businesses. And, and the reason I ask this question is there’s some people that are watch this, that have businesses that maybe haven’t considered going this route to, for, you know, to, to get access to capital.
What are some of the things that some of these businesses use these funds for? So I think this is a really common question. Mm-hmm. And the answer is, a business cannot come to our platform to raise funds. I. That, that is more like growth equity, right? Yep. So if a business wants to, you know, add a new line or something like that.
Yeah. Like they raise a bit of money to do that. Like, that is not us. Yeah. We only fund the acquisition of it. So businesses per sale, it makes 2 million a year. It’s selling for 6.5 million. Mm-hmm. You know, 2 million of that needs to come from investors. Here’s that 2 million. Yep. That’s, that’s kind of how it works there.
So. Mm-hmm. We’re not fund funding growth, we’re just funding acquisition of like a historically profitable business. And generally one where the person buying it has identified growth levers to help grow it. Mm-hmm. But we’re not depending on the growth. Yeah. I, I personally have a little bit of a distaste for investments where.
They think growth is easy and they really depend on growth for the investment to make sense. Mm-hmm. I’m like, well, what happens if it doesn’t grow at all? What does my return look like then? Or if it even declines a little bit, am I, am I still good? And those are the type of things that I like to go for, which tends to be the things that are on Capital Pad because I approve all the investments where me and my co-founder do.
Amazing. Well, Travis, man, this has been enlightening. I, I learned a lot. I’m, I’m excited to learn more about Capital Pad, continue to find, follow the journey. That being said, I mean, what, what’s next? What’s next for you? What’s next for Capital Pad? I think we just keep expanding what we’re doing. The. The, the space is really exploding because there’s a lot of people have heard of the term like silver tsunami.
Mm-hmm. There’s, I think, like roughly 10 million businesses in the us. Maybe I just messed up that step. But anyway, there’s a crap ton of companies Yeah. That have to be sold over like basically the next decade because people are retiring, you know? Yeah. They gotta, gotta retire, man. At some point they gotta, they gotta be gone for 70 year years old.
It’s a good company. There’s no succession plan. The kids don’t wanna run it or they don’t have kids or whatever. And so these businesses have to be sold. And this is kind of funnily like the, the new age of like entrepreneurship and growth mm-hmm. In like our country. And we’re facilitating those. And I, and I think at the same time, this is one of the most attractive asset classes that exist for credit investors.
And so I think we’re, we’re the only ones actually enabling people to do this. Instead of having invest in like speculative ventures based on future maybe profits, it’s more like, oh. This company’s been around for four decades. Like, let’s own part of that. Like that’s great. You can buy it for a three x multiple.
Oh my God. Amazing. That’s what I’m talking about, Travis. If somebody wants to follow up, learn more, connect with your team. How do they do that? Whether business side or business owners or investors? Capital pad.com. You can basically choose your own adventure. If you’re an investor, you can go on that path.
If you’re a sponsor or a searcher, you can go on that path. Follow me in any of the, the socials, you know, Twitter, just Travis Jameson, search it, or LinkedIn. Same thing. Like I’ll be the first person that pops up. Yeah. Follow me there. Reach out anytime. I’m happy to chat with anybody. I. Fantastic, everybody watching, just so you know.
We’ll definitely put the links in the show notes so you can just click on ’em and head right on over. And speaking of the audience, if this is your first time with Mission Matters and you haven’t done it yet, hit that subscribe or follow button. This is a daily show. Every day we’re bringing you new content, new ideas, new interviews, and hopefully new inspiration to help you along the way on your journey as well.
So again, hit that subscribe or follow button. And Travis, thanks again for coming on. I appreciate it. It was great. Have a great day.
Let’s chat.