No Shortcuts: The Case for Patient Sourcing and Earned Partnerships - Part B

So I think Jeff got us kicked off in part A, so Eric, I'm gonna come to you first on this question.

So the past 18 to 24 months have been challenging across the board with compressed exits, cautious LPs, and slower deployment.

So my question to you is, where's Trident finding the best risk-adjusted opportunities right now, and what's your approach to pacing in the current environment?

Sure.

And thank you so much, Todd, and, and the BDO team.

Just very much appreciate you guys doing this and having me aboard once again.

You bet.

From a pacing perspective, the answer's easy.

We don't change the way we pace due to the environment.

We've been called grumpy underwriters historically.

[laughs]

I take that as a compliment because o- our, our process doesn't start with deals, it starts with finding operators who then lead us down these paths to build really great theses.

And from that thesis creation, we go after transactions.

What I didn't say in the first episode is that process might take us 18 to 24 months.

And so if you see a headline of Trident closing a deal, you know, you might think that that was three months of hard work.

You know, yes it was, but you might be missing the 12 to 18 months of work that went in before that just to know that that is where we wanted to be.

And so because that process is so long-winded, there are years where we don't get a lot done, and maybe the market is, you know, piping hot, and then there are years where we do get a lot done and, you know, the market's a little bit weaker.

This is one of those years where, you know, we're frankly just chock-full of opportunities, but again, all of those processes started a year or more ago in many cases.

That's the first thing I'll say.

The second thing I'll say is, is sort of where are we looking? You know, right now, I said in the first episode we like the most, you know, the r- r- red-blooded American companies.

You know, we're looking sort of in the most red-blooded of the red-blooded places these days.

You know, we're, we're looking at the laundry space right now, rolling up laundromats.

We just bought a plumbing business very recently, um, which has been growing rather nicely.

So these are spaces that we know private equity has looked at in the past, but what we did is we spent a lot of time really trying to understand why these opportunities still exist and what private equity might have missed historically.

And if you look a little closer, you'll find in many of these sectors that technology has actually started to shift the ability of these businesses to be investable.