“We’re going to buy businesses and implement AI.” Guys, with the exception of maybe a handful of people or firms, I’m not sure many people have a better front-row seat to the small and lower-middle-market acquisition ecosystem than we do. We take 200+ calls every month from prospective buyers, searchers, independent sponsors, family offices and private equity funds. And that doesn’t include the orders of magnitude more conversations we see through communities, group chats, conferences and the hundreds of transactions that move through our firm. Based on our own deal volume and what we see in the market, we believe we’re among the most active law firms serving the lower-middle-market M&A ecosystem in the country. And I can tell you: “We’re going to buy businesses and implement AI” is EVERYONE’S thesis right now. Greg’s piece is thought-provoking, and I think his broader point is right: everyone buying or operating a business should be thinking seriously about how AI can be layered into the company to improve productivity, reduce costs and expand margins. That is absolutely where things are going. And damn it, it’s a GOOD thesis. I say “good,” not “great,” because there is a huge assumption buried inside it: That you actually get to the part where you can focus on growth and AI implementation. The acquisition lifecycle usually looks something like: 1. Acquire 2. Stabilize 3. Grow 4. Exit AI implementation is largely part of Step 3... Growth. But before you get to Step 3, you have to survive Step 2. And Step 2 is where things get real. > You inherit employees you didn’t hire. > Customers you didn’t acquire. > Vendors you didn’t negotiate with. > Processes you didn’t design. > Technology you didn’t choose. > Financial statements you didn’t prepare. > A culture you didn’t create. And often years of institutional knowledge sitting inside the head of a seller who just got wired a life-changing amount of money and is mentally halfway to the beach. Meanwhile, the debt payment is due every month. A lot of acquirers get stuck somewhere between Stabilize and Grow for years. > They fix people problems. > They replace customers. > They rebuild accounting. > They improve working capital. > They learn the industry. They deal with equipment breaking, key employees quitting, sellers behaving strangely, unexpected capex and a thousand other things that never appeared in the CIM. They put out near CONSTANT fires. They service the debt. They hold on for dear life. They may still create seven figures of wealth... But they never really reach the clean, optimized growth phase they imagined when they built the model. That’s why I think assuming you can simply acquire a business and quickly increase EBITDA margins by the magnitude Greg is describing will be wishful thinking in most cases. Not because he’s wrong about the opportunity. He isn’t. AI can absolutely improve margins. It can reduce administrative labor, improve sales processes, accelerate quoting, enhance customer service, automate workflows and create enormous operating leverage. Everyone should be thinking about how to use it. But growth requires stability, management bandwidth, good systems, clean data and capital. AI is a tool. It is not a substitute for competent operations. You still have to buy the right company. At the right price. With the right capital structure. You still have to retain the right people. Protect the customer base. Understand working capital. Manage cash. Navigate the transition. And actually operate the thing. So if you’re considering acquiring a lower-middle-market business, do your homework, hire good advisors and go in with your eyes wide open. Greg is right that AI creates a massive opportunity for business owners and acquirers. But the hard part is still getting the business into a position where you can actually capture it. This is hard as FUCK. And AI didn’t make that part any easier.

Whoever gets 3 cones is the winner 👌🏾❤️

BREAKING: A Morgan Stanley banker accidentally leaked an internal document listing over 100 deals its Asia investment banking division is currently pitching and working on.

*BRIGHTLINE PREPARING FOR BANKRUPTCY FILING AS SOON AS THIS WEEK

Bain Capital agrees to acquire SOLitude Lake Management from Rentokil for $230mm. $112mm revenue, $16mm adj. operating profit in 2025.

CC the entire fam 🤝! Today, we’re announcing the new CC – an AI agent built for families to spend less time on logistics and more time together. You can now: 👤 Add up to 5 members to your CC agent ☀️ Start mornings aligned with a shared "Your Day Ahead" brief email 🗓️ Autosync schedules & to-dos with a shared Google Calendar and Tasks 💬 Coordinate in Google Chat with CC to offload relevant tasks (ie., crafting weekly meal plans, school supply shopping lists, etc) 📝 Delegate paperwork (ie., permission slips, forms, and more) for CC to complete under your direction 📌 Keep tabs on the details – CC remembers what applies to everyone (ie., family grocery lists, favorite restaurants) versus what applies to one person (ie., dietary restrictions, local timezones) Ready to keep everybody on the same page? Join the waitlist or upgrade your existing CC (US only, 18+): labs.google/cc

7(a) loans made in FY2024 are defaulting at 7.2% in their second year. The FY2016 cohort ran 3.0% at the same age. Per Lumos, cohorts lined up by loan age. Loans written in 2024 are failing at more than twice the pace of the ones written in 2016, and FY2025 is tracking 2024 so far.

I’ve spent most of my career operating businesses, but investing has shaped how I operate just as much as operating has shaped how I invest. This piece is about that intersection. Companies mentioned: $MRP $ADMQ $OPEN $BLNE $NXH $DFH $EMBC

This is going to destroy relationships. It's over. Boyfriends are cooked. Nuked from orbit. Toasted. Fried. 💀💀💀

JUST IN: TSA rolls out new program allowing people without plane tickets to enter airport gates to visit terminal restaurants & shops.

The Clippers have sent the following letter to NBA commissioner Adam Silver:

Friday Story Time. One year into consulting, a partner asked me to stay back after a client session. I figured praise was coming. It wasn’t. He asked me a question I can still hear twenty years later. Do you want to be trusted with the big models, the big meetings, the big decisions? Then take care of the details. I’d been treating the small stuff as beneath the job. He was telling me the small stuff was the audition. For the next 3 months I made details the whole job. Numbers that footed. Formats that were clean. Names spelled right. Nothing left for a reviewer to catch. The bigger engagements followed. Then the bigger rooms. Not because I got smarter. Because I stopped giving anyone a reason to double-check my work. Trust is built at the decimal level. What’s the smallest habit that changed your career?

Apparently concert venues are having a hard time getting Millennials to fill the seats. Well, hello. Millennial here. I think I can help. DEAR CONCERT VENUES: 🎟️ Just tell me what the ticket costs. I do not want to select a $79 ticket and discover at checkout that it is actually $146 because of a facility fee, service fee, processing fee, and a fee for having successfully paid the other fees. 📱 Stop making ticket buying a military operation. I should not need three apps, a verified fan code, a presale password from a credit card I don’t own, and 11:00 AM availability on a Tuesday to buy two seats. 💺 Assigned seats. We did our time standing shoulder-to-shoulder at shows in 2008. Some of us have mortgages now. Some of us have sciatica. 🕖 Start earlier. A 7 PM show is not embarrassing. In fact, I would like to formally recognize whoever invented the 7 PM show. ⏰ And tell us the actual times. “Doors at 7” is not useful information if the opener starts at 8:15 and the person I came to see appears at 10:07. 🚗 Parking instructions written for a normal person. Tell me which garage to use, what it costs, and whether I will spend 55 minutes trying to leave it afterward. I am willing to pay $20 for certainty. 🍺 I will buy your $14 beer. I have accepted this. But if I miss three songs waiting for it, you have broken the social contract. 🚽 Enough bathrooms. We are in our 30s and 40s. Half of us have had children. This is now infrastructure. 🔉 It can still be loud. We are Millennials, not the Greatest Generation. But some of us are bringing earplugs now and we are no longer ashamed of it. DEAR ARTISTS: ⏰ Please go on roughly when you said you would. We have babysitters. The babysitter has an end time. This is now a logistics problem involving several adults. 🎤 Play the songs from 2004–2014. You know which ones. We know which ones. Nobody needs to pretend otherwise. 🎶 Play some new stuff. Absolutely. We support your continued artistic development. But there is a point in the evening when you need to play the song that was on our iPod Nano while we drove to high school. 📵 You can tell us to put our phones away. We secretly want someone to make us do this anyway. 🪑 An intermission would not offend us. We can use the bathroom, answer the babysitter, check whether the dog has destroyed anything, and look at Zillow for eight minutes. And please understand: Millennials still like concerts. We have disposable income now. We are nostalgic. We will absolutely spend irresponsible amounts of money to hear a band we first discovered on LimeWire. But we also have jobs, children, dogs, mortgages, lower-back problems, and a very clear memory of when concert tickets cost $35. You want Millennials back? Make it easy to buy the ticket. Tell us when the show actually starts. Give us somewhere to sit. Play the song from 2007. We’ll be there. We just need to be home by 11.