From a $27,500 Charter Company to a $4 Billion Private Jet Giant | Kenn Ricci, Flexjet

Kenn Ricci is the chairman and largest shareholder of Flexjet, a fractional private jet company that operates more than 360 aircraft and is the largest Gulfstream operator in the world. A former Air Force-trained pilot, Kenn bought a small Cleveland charter company in his twenties so he could keep flying, built it into Flight Options, lost control of it to Raytheon in 2002, and bought it back during the 2008 financial crisis before acquiring Flexjet from Bombardier in 2014. He explains how Warren Buffett’s purchase of NetJets unlocked his financing, why he avoids mergers, why he has kept Flexjet private, and why he gave his children their wealth early through a family limited partnership. He also shares the advice from Notre Dame’s Father Ted Hesburgh that shaped his idea of a life of significance, and why every Flexjet employee can fix a customer’s problem without approval. Show notes: https://www.davidsenra.com/episode/kenn-ricci Made possible by Ramp: https://ramp.com Deel: https://deel.com/senra AppLovin: https://applovin.com/senra Chapters (00:00:00) Kenn's son had never flown commercial (00:02:34) Giving your kids their wealth while you're alive (00:07:03) Charlie Munger: "You give them the money" (00:15:57) The rule his kids made to avoid jealousy (00:25:36) Buying a failed charter company for $27,500 (00:35:05) Turned down by every bank until Buffett bought NetJets (00:39:33) $100 million in sales in 3 months (00:41:36) Why he hates mergers (00:42:58) Losing his company: the worst day of his life (00:52:15) Buying his company back in the financial crisis (00:56:08) The $600 million problem that led to Gulfstream (01:03:01) Father Hesburgh's 3 rules for a life of significance (01:05:47) Why he gave away everything he owned (01:09:57) Why any employee can comp a $300,000 trip Learn more about your ad choices. Visit megaphone.fm/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:02David Senra?

  I just interrupted you before we started recording. I wanted you brought up your kids.

• 0:05Speaker 01

  You were talking about the addiction of flying privately. And I have three children and they're six years apart. So there's 12 years from the oldest to the youngest. And when I was building the business, and of course, remember, I started the business. I was flying too. So I would fly and run the business. When you raise a child, you start on braille and you start to figure out like, you know, what's the relationship going to be like? Did I spend enough time? Did I miss Little League games? But I decided I was going to give them a love of travel. So I had them all skip eighth grade and we traveled during their eighth grade year. And we didn't leave for the whole year. We'd go on six three week trips. And during that time, I would homeschool them and I'd make them build a curriculum around where they wanted to go. And we didn't take them to Paris and London. I mean, we took them to places around curriculum.

• 0:50Speaker 01

  Who wanted World War II? Who wanted to go to India? Who was fascinated with Asia? So we built these curriculums around, actually, the two places I made them all go was Auschwitz and North Korea. So I'm probably the only person that's been three times to North Korea. But you know, life changed. So starting in 2005 to 2017, think of the 12 years between the youngest one, who, when he did his trip in 2017, I realized had never been on an airline.

• 1:19David Senra?

  An airline, you mean a private jet?

• 1:21Speaker 01

  No, no, no. He'd never been on an airliner because life for me had changed.

• 1:25David Senra?

  Oh, he'd never been, he'd never flown commercial.

• 1:27Speaker 01

  He'd never flown commercial. And so I decided that's a bad way to raise a child. So I decided his name's Austin. So I said to Austin, we're going to go, we're going to go commercial. We were going to Tokyo and we get, we go to the airport, never done this before. We wait in line, check our baggage, you know, wait for our seat to be called, you know, sit down, don't take your shoes off. But, but all the things you do, right? Security and so on. We sit down and finally we're getting ready to take off. And I look over at Austin, I go, Austin, what do you, what do you think? He goes, hey dad, there's people on this plane I don't know. So what he didn't get was like the commercial, the public, public part of commercial transfer.

• 2:06David Senra?

  It's funny that you, we were talking about this right before we started recording. I was like, we gotta hit play. Cause I'm so interested in like, you started talking about, you know, a lot of people that build successful companies like you do. There, there's this huge doubt in their mind, like, you know, I'm hugely driven. I have a goal in my life, but like, there's has to be things that are sacrificed for that goal. Obviously time with the children is one thing that, that people do. But one of the things you didn't even know I was going to ask you first was, I heard you talk about something that's interesting to me. That is, you decided to share your wealth with your kids, not when you die, not when they're older, but right now. You have a very interesting perspective on this. Can you explain what you're doing?

• 2:44Speaker 01

  I became to believe that we have the wrong perspective on raising children. We seem to think it's about this time we spend with them. So therefore we kind of raise this helicopter mentality, right? We go everywhere with the kids. We don't let them out of our sight anymore. When I was growing up, I left at nine in the morning on my bike and I just had to be home for dinner and mom couldn't chase me around Cleveland, Ohio, right? Those days are gone. We tend to think that we put time into them. That's the essential. When what we really need to put with them is we need to show them that we trust them and they can trust us. Think about wealth transfer. And if you don't tell your kids about their financial arrangement, you're saying you don't trust them.

• 3:26Speaker 01

  And I told my wife, girl, you know, when the kids were young, I go, you know, we're thought, we're thought as parents to talk more about sex than we are about money. And the reality is money will get you in a lot more trouble than sex will. So I had three observations about wealth transfer. One is that there's a whole cottage industry around trusts and the management of generational wealth transfer. And there's big money in it. The system wants you to think you have to control wealth because that brings in the trustees. That brings in the law firms and the banking firms and all those necessary professionals to kind of skim away your, your wealth. Second of all, the Chinese have a saying, the, the, the son of a lion is a lamb.

• 4:09Speaker 01

  And so the, I think people that create a lot of wealth, particularly if it's entrepreneurial wealth, tend to have, they're lions and lions are control things. And so why not buy into the system where you control your children? And so this, this is why these trusts are set up at 25, they get this, at 35, they get that, at 45, we get, they get this, right? And this is kind of a, a way to control from, from the grave or for the patriarch or matriarch or the wealth to still be influential, even when they're not around. Because

• 4:42David Senra?

  They're used to being in control.

• 4:44Speaker 01

  They want to be in charge. They want to be important. They don't want to lose their, their relevancy. And then finally, there's the most bizarre one to me is if we tell our kids, if we give our kids wealth and we tell them about wealth and they know about this, they'll become lazy. Well, man, does that say, you were must've been an awful parent. If that was the one thing that, that flips the switch, you couldn't parent through that. So I decided a past, number one, most importantly, I love my children and I love watching them be happy. I want to watch them spend their money. I want to watch them be wealthy, but most importantly, I want to help them. I know a little bit about, about wealth. I knew a little bit about, now I'm accidentally wealthy. I didn't get here with some strategic, you know, some monetary plan, financial plan.

• 5:28David Senra?

  Hold on, we're going to, we're going to dive deeper on that. But give me some background. Did you grow up middle class, poor? Like, what was your childhood like?

• 5:34Speaker 01

  Oh, my father was a grade 12, worked for the US government. He's actually a spy. He had a fascinating background. He came out of World War II, worked in the OSS, worked in naval intelligence. And then had a, in the sixties, early sixties, Bobby Kennedy set up the OCD, the organized crime drive through the treasury department. My dad was a part of that, a part of that, that group. And that investigated, investigated domestic, mostly mafia, mostly organized crime in those, in that era. His undercover name was Richard Dill. Don't get, he was investigating a lot of cases, Italian, he was Italian. They changed his name to Dill. Think of that's, that's the government at work. I remember one time, he, by the way, he only, in 17 years of undercover work, he only

• 6:19Speaker 01

  worked on three cases. So shows you the time it takes, right? To be in

• 6:23David Senra?

  So his undercover name was Dick Dill?

• 6:25Speaker 01

  Richard Dill. Dick Dill.

• 6:27David Senra?

  Richard's always short.

• 6:28Speaker 01

  Yeah, yeah, yeah. He was investigating the police chief of Lincoln, Nebraska. And

• 6:34David Senra?

  For ties to the organized crime.

• 6:35Speaker 01

  I'm seven years old at the time.

• 6:37David Senra?

  And he can't tell you.

• 6:37Speaker 01

  I don't know much about it, but, but I knew that, I knew that we had to go live in Nebraska for two months because he was there undercover as a family. This was the greatest time of my life. We stayed at a Holiday Inn, it had a pool. I'd never been any place where they had like a pool outside your

• 6:50David Senra?

  Okay, so that, that hits on it. It's like middle class, somewhere around there, didn't have a pool. The reason I wanted to start on this, and I'm going to still pull on this thread if you don't mind, is because I have this other podcast called Founders. I read biographies of prestigious entrepreneurs. People struggle with this all the time. It's in these books for going back to 200 years. They're like, I was, essentially the, the problem is, I was the son of a poor man. My kids are the son of a rich man. What do I do here? And so I had the, the luck of a lifetime to be able to go and have dinner at Charlie Munger's house right before he died, probably six months before he died. And one of the questions I asked him was, because me and him had run, he read, you know, hundreds of biographies. I was doing the same. I was the, my like craft and the main, before I started the show, like all I was focused on. And I was just like, what's the answer to that? Like you read the same books I do.

• 7:34David Senra?

  What, what's your answer? You know, he grew up, he wasn't poor, but they were in a home mall. It was like a normal life. And he goes, you give them the money. And you know, because Munger's is just no bullshit, like straight to everything. And I go, why? He goes, because what, he goes, they'll hate you if you don't. And he goes, and what's the point of building a relationship and making all this money? And then at the end of your life, your kids hate you. And that was his very simple way of looking at this.

• 7:54Speaker 01

  Fantastic, fantastic insight, right? Like I said, I want to watch them enjoy their wealth.

• 7:59David Senra?

  He's, this say one funny thing though, because somebody, I think, I may have asked him a follow up, either me or somebody asked a follow up. I go, yeah, but won't that make them a little less ambitious? He goes, yes. And in his case, I think he gave, he gave a couple hundred million to I think nine kids or something like that. And he's like, yeah, some of them have $250 million and they're not as ambitious. Like, so what?

• 8:19Speaker 01

  They're different. Every kid is different. In fact, one of the things, we have these family meetings once a year where we talk about wealth. And one of the things I start out with each project, because when I look at why families rip apart over wealth, right? It's really in two areas. One of them is that they feel somehow they're entitled to be equal, but they're not. I have a child that started inheriting wealth 12 years before the youngest one. You don't think his estate, you don't think what he has appreciated at different rates than the youngest one? So I start every meeting, I go, look guys, you're not equal. It doesn't mean I don't love you. Doesn't mean, it's just, it's just how things are. And the sooner you get over that fact, the happier you'll be. It's just, it wasn't set out that way.

• 8:56David Senra?

  So are you already given all the wealth you're going to give to them? Or that you keep, how do you, like, how do you?

• 9:00Speaker 01

  Well, well, yes, pretty much so. Because we gifted shares of a family limited partnership when they were very young.

• 9:08David Senra?

  Did you get this idea from Sam Walton?

• 9:09Speaker 01

  Uh, no.

• 9:10David Senra?

  You know, that's how Sam Walton avoided a lot of, he didn't do it to avoid estate tax or wind up, he's like, well, if you want to avoid estate tax, you give

• 9:17Speaker 01

  Very early.

• 9:18David Senra?

  Give your kids the asset before

• 9:19Speaker 01

  It appreciates. It's so logical.

• 9:21David Senra?

  The crazy thing is he did this, his father-in-law gave him the idea. I've read every single book on Sam Walton. And his father-in-law gave him the idea. They did this when the value of Sam Walton's company was like, I think the shares that he gave to his four kids were $5,000 each.

• 9:35Speaker 01

  Ditto. Okay. I started the family limited partnership in 1990. I had my first child in 1995. So I have the vision of what it's going to do five years before it happens, right? And as soon as I could, as soon as I could, I gifted shares. When they were born, I gifted. It's a family limited partnership. So the general partner, which is me, still can, you know, I have all the flexibility in the world to make distributions. It's a phenomenal vehicle. So Walton had it right. It's a great vehicle. So they're not created equal. I want to watch them happy. I want to watch them use their, but, but also I want to guide them. I want to be here alive when they're making stupid decisions with their money or making good decisions with their money. I've made stupid and I've made bad decisions with money too.

• 10:19Speaker 01

  But so, so why can't I be the one to guide them? Otherwise, assuming they, they still love me when I'm dead, they tend to love you more when you're dead. But in any case, assuming they still love me, well, they're going to go, well, what would dad have done? Well, isn't it better to like be here alive when they ask you, what, what should I do, dad? You know, that's the foundation of it. So I think sometimes we want to rule from the grave. You have this trust environment that's there. And then if you're going to, if this is going to spoil your kids, then you really weren't that good of a parent. If that was the one thing that did it, they couldn't handle this. Or maybe the, the alternative is it's all the more reason to give it to them when they're alive. So you can guide them through it, right? As opposed to when they're dead and you can't do anything. When you're dead and you can't do anything about it.

• 11:02David Senra?

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• 11:45David Senra?

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• 12:29David Senra?

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• 13:15Speaker 01

  Not one, not one. In fact, I've seen many things I didn't really, I didn't think would happen. So for instance, I asked them, now remember, this is going back. When they're young, I started talking to them about money. Now, at five years old, six years old, now we're not talking about tax effective or compounding interest, but what I taught them early on was giving. So our early family meetings were all about who should we give money to and why. My daughter loved animals, my son loved Catholicism, and my youngest son, I remember the first time we were giving, he was maybe six years old, he always wanted to give it to Disney. And I was like, well, Austin, Disney's not really a non-for-profit.

• 13:55David Senra?

  Yeah, they're doing okay.

• 13:56Speaker 01

  They have their own methodality. So I taught them first to give, then, before we started really diving into the estate, and I really went into that when the youngest one was around 16, where we really started going through, like every year, we go through a spreadsheet. Where's the money? How does it transfer? Who has control of it? Where's the bank? Like, all the stuff you need to know, everything. But before we did that, we did a, we did a personality test, and everybody reported on their personality, because kids are different. Who thinks left brain? Who thinks right brain? So I wanted the kids to understand how they could get along, so I started with that. So then we started talking about money, how it transfers, like what we would do with it. Two surprising things.

• 14:40Speaker 01

  Number one is that it creates this trust, and I have these, I have this amazingly trusting group. Now, the kids in the group of five, my wife and I and the three children, they report, they show us their estate and what they spent money on, and we share this.

• 14:55David Senra?

  How old are the kids now?

• 14:56Speaker 01

  So 37, 31, and 25.

• 15:01David Senra?

  Okay.

• 15:02Speaker 01

  Yeah, okay. So it's been going on, it's been going on for a while. But the other thing, like, you know, I mentioned I'm accidentally wealthy. You have to realize that even when we were talking about this, we weren't talking about it, that the volume we're talking about, say, I mean, my personal net worth has accelerated in the last six years, along with FlexJet, which is the asset I own, you know, one of the largest assets I own and protect.

• 15:25David Senra?

  One of, it's got to be the largest asset.

• 15:27Speaker 01

  Well, it's the largest one, yes, but.

• 15:28David Senra?

  What else you got that I don't know about?

• 15:30Speaker 01

  Well, I mean, I always say I'm an inch wide and a mile deep. I've made a lot of investments only in aviation. I probably know more about the area of aviation. I've invested, I own Simcom, which I sold to CAE. I owned, I owned what is today Atlantic Aviation.

• 15:45David Senra?

  Hold on, let's, so let's, this is exactly, so I want to start talking about the business, because I think I understand the, what you did on, with your kids and why you did it. And I think, again, anybody who's wealthy has to think through these things. I think discussing them openly is a service to other people.

• 15:57Speaker 01

  Oh, I'm sorry, let me finish what I, what I learned.

• 15:58David Senra?

  Go for it.

• 15:59Speaker 01

  Okay, so number one, this amazing trust that they got amongst themselves, right? They started investigating and reading about biographies and families that blew it, and they came to realize that the third transfer of wealth, the third generation's a tough one. And so they've started to talk.

• 16:14David Senra?

  Shirt sleeves to shirt sleeves in three generations. This is something very durable throughout human history.

• 16:19Speaker 01

  So they've come together to talk about the next passing of wealth and generational, and two, two things that they, they've come up in the last year. One is they decided not to include spouses in these meetings. They decided that each one of them, two of them have spouses, one doesn't, they decided in these meetings that each one of them will decide how to share financial information in their own family, that this isn't a group share. This is us five, and we've been doing this for 10 years, 12 years, and it's not something, we're not going to toss people into the middle of it, because we don't know their personalities. We didn't have 10, 12 years of grooming to get them to this point. So that was number one. Number two was, when they look at generational wealth transfer and why families come apart, one of the things that happens, other than they all feel like they weren't treated equal,

• 17:04Speaker 01

  they're mad at the patriarch for not treating them all equal, which we've gotten over. But the other thing that, that happens is one of them does really well, takes the money and makes a great investment, and the other ones do less. And then there becomes a little jealousy amongst them. So they decided, they came to the idea that any investments they all make, they're going to share, and the person who has the investment.

• 17:27David Senra?

  The three kids.

• 17:28Speaker 01

  The three kids.

• 17:29David Senra?

  Wow, okay.

• 17:30Speaker 01

  The person that has the investment can put 60% of it in, but has to offer, but not required, 20% to each of the other siblings, and they can participate or not, thereby alleviating the opportunity for them to be jealous. Look, I gave you the opportunity to come in, you came in and you didn't, or we share the upside to get. That was their idea, not my idea.

• 17:49David Senra?

  That's really interesting. Okay, so let's go to the source of the wealth.

• 17:52Speaker 01

  Yeah.

• 17:53David Senra?

  You were a pilot, okay. Take me back to like, well, first of all, how old were you when you learned how to fly planes?

• 17:57Speaker 01

  You talked about my upbringing with my parents a little bit. My dad was a government employee, and I went to a Jesuit high school, St. Ignatius, and they sent, at the time, in the 70s, they sent 30 people to Notre Dame. They moved them right from there to Notre Dame, and I loved it. I wanted to go there, and I was, I got, I got, I got admitted, and then I'm going up for a visit. And I grew up in a, you know, houses have two-by-fours, ours had one-by-twos. So I could hear my parents, I'm an only child, and I could hear my parents talking the night before I'm going to Notre Dame, and they say, you have to tell them, we shouldn't let them go, because what if he goes up there and he likes it, and then he wants to go, and we tell him we can't afford to send him. My mom was saying, I wouldn't let him go, and my dad would go, let him go, maybe he doesn't like it.

• 18:40Speaker 01

  And then he comes back and says, I don't want to go anyhow, and then we don't have to have this subject. But I knew going up for that class visit that, didn't matter how much I liked it, I knew it was coming when I came home and said whether I wanted to go or not. So I was inclined not to go and put my parents in a bad position. When I get there, I asked them on campus, is there a, is there financial aid available? Like, well, you missed the deadline, this is March. But the Vietnam War, this is 1974, the Vietnam War was still very ripe, very raw, and people did not like the military. And so they said, if you're willing to go into ROTC, they're always short of the candidates, they never fulfilling their quota. So for some reason, don't ask me why, I decided I wanted to be a Navy pilot. Maybe I like the double-breasted suits, whatever.

• 19:25Speaker 01

  So I go down to the ROTC building, and there's no cell phones, and I'm looking through the glass window, I'm trying to read upside down on the phone, what number to call on Monday morning to tell them they had a new naval aviator.

• 19:37David Senra?

  Why'd you pick aviation? You had never flown a plane or anything?

• 19:39Speaker 01

  No, I had to go in the military. I know I had to go ROTC, I figured, if I got to go into the military, flying looks like a lot of fun to me.

• 19:45David Senra?

  Yeah.

• 19:46Speaker 01

  I'm copying the number down, and somebody taps me on the shoulder, and they said, can I help you? And I said, yes, sir, I'm an incoming freshman at Notre Dame, and I would like to join the Navy, because I want to fly. And he said, you've been admitted to Notre Dame? I said, yes. He goes, I'm shocked, because they usually admit smarter people than that.

• 20:04Speaker 01

  He said, "The Navy has ships and the Air Force has planes." "I'm Colonel Muller. I'm head of the Air Force detachment and I'm enrolled in the Air Force." "And I never heard, I never knew how my parents reacted, but I came home..."

• 20:17David Senra?

  Because then they'll pay for school.

• 20:18Speaker 01

  Yeah, yeah. I don't know that I've ever told this story. It was the first time I learned how to defraud the government. It was, I'm a freshman at Notre Dame. I'm enrolled. I've got my hat, I've got my uniform. And, um, and, and the sergeant who administered that said, "Now, I know, I know you're a plebe here, but here's how, here's how you..." "You get a hundred dollars a month stipend for general expenses." He goes, "But there's other income." He goes, "Here's what you do. You go to the bookstore, you buy all brand new books. You bring me the receipt. I'll reimburse you for the new books. You take them back to the bookstore and then you buy the used books." So, like, my first, my first interaction with the military is I was taught, like, how to take advantage of the US government.

• 20:57David Senra?

  Did you take time off from Notre Dame to learn how to fly?

• 20:59Speaker 01

  No, no, no. You learn it concurrent. You, you, you, you, you, one day a week, and this was the tough one. One day a week, you have to stay in uniform. And, and believe me, at that time, post, you know, that Vietnam War era, that was not an easy task. Because people did not like the military at all at that time. So, you know, you have all these courses around the Air Force. In the summer, you go to whatever your summer program was, your summer school and so on. And then, so that's where I learned to fly.

• 21:26David Senra?

  So what kind of planes do you fly, the first planes you fly?

• 21:29Speaker 01

  You know, the Cessna 152, Cessna 172.

• 21:32David Senra?

  They're not putting you in, like, the F-16s?

• 21:33Speaker 01

  No, that comes after graduation. No, in fact, you know, when you graduate, what happens, then you go to general flight training, which is done, like, in T... At that time was done in T-37s and T-38s. And then you get assigned, you know, it's a year and a half before you get control of a jet in the Air Force. There's the primary training, then there's the training you go into.

• 21:52David Senra?

  Okay, so you, you mentioned, "Hey, I'm an inch wide, but I'm a mile deep."

• 21:55Speaker 01

  Yeah.

• 21:55David Senra?

  All my business is focused on the, this, we've mentioned Buffett and Munger. I don't know if he said it on the show, if we were talking before. But like, we both mentioned Buffett and Munger a bunch of times. And their whole thing is like, know your circle of competence and just stay inside that circle. So it sounds like what you did. Your first...

• 22:08Speaker 01

  I always say, "My portfolio of investments is unbelievably diversified. It's cash and airplanes." That's my diversification strategy.

• 22:16David Senra?

  So what's the first business you do in aviation?

• 22:20Speaker 01

  So first of all, I don't, I don't, I don't think of myself as a businessman. In fact, I'll often say, "There's two people that are very successful in business." One is a person that just gets business. They could run a yogurt store, they could run a steel manufacturing plant. They just get business. They understand how they're connected. They see market strategy and business is just very clear to them. And the other ones that are just passionate about what they do. You're passionate about your podcast. You're successful in business because this is what you love to do. I'm successful because I love to fly and I learned everything airplane, right? That, that's what put me here. But I didn't, I never had a goal to become wealthier, to build a business.

• 22:57David Senra?

  That's the accidental wealthy part you're...

• 22:58Speaker 01

  Sure, of course. In many ways, right? Accidentally that I even formed a business, accidentally that, uh, you know, that, uh... When I go into private aviation, there's only 5,000 jets in the world. And today, there's 35,000 jets. So part of my luck...

• 23:13David Senra?

  Wait, wait, wait. Say that part again.

• 23:15Speaker 01

  Yeah.

• 23:15David Senra?

  When you started, what year is this?

• 23:17Speaker 01

  1985, figure about the...

• 23:18David Senra?

  There's only 5,000 jets?

• 23:19Speaker 01

  5,000 jets in the world. And today, there's 35,000 private jets in the world. So, part of my, part of my luck was just to be, when this industry grew up. I entered an industry, because I could have been an airline pilot. I could have gone into, I could have stayed in the military, but I was attracted to private aviation. It was more free to me. It was more, it was more spontaneous. It was more interesting. Uh, the people you would meet, that there's no cockpit door. I could have conversations with passengers and learn from them. So, who knew in 1985 that private aviation would be this unbelievable growth industry in the next 40 years? Right? Didn't know that. So that's, that's part of it. But, but what I'm really doing is flying. I leave, I leave the military, I become a cargo pilot flying air freight.

• 24:04Speaker 01

  Then I go to Northwest Orient. I'm at Northwest Orient a very brief period of time. They have a furlough, so I lose my job.

• 24:09David Senra?

  So wait, Northwest Orient doesn't exist anymore?

• 24:12Speaker 01

  No.

• 24:12David Senra?

  It's a, it was an airline?

• 24:13Speaker 01

  It was an airline, yeah.

• 24:14David Senra?

  So you're an airline pilot?

• 24:15Speaker 01

  It was, you know, the airlines were Pan Am, TWA, Northwest, the, the airlines that flew all around the globe, they were the good air... They were the airlines that were the prestigious ones.

• 24:24David Senra?

  Okay, so you're in Northwest, uh, Orient. You said you got furloughed, which is another name for fire.

• 24:28Speaker 01

  Yeah, it's a fancy term for, "I don't have a job." So I came back to Ohio. Ohio, birthplace of the Wright Brothers.

• 24:34David Senra?

  Yeah, well, that's, that's in southern Ohio. Yeah, but I think Dayton, right?

• 24:38Speaker 01

  Yeah.

• 24:38David Senra?

  So I'm like, okay.

• 24:39Speaker 01

  But my, my father was, he, he didn't see it as a very stable career. He, he said, "I know a lot of pilots and they're all airport jockeys. They just kinda move from place to place and they end up taking whatever job they can. It's just not a stable industry." So it was at that time that I, I, I went to law school. And, uh, I really...

• 24:59David Senra?

  So you love flying and pilots. Your dad's giving you, in hindsight, bad advice, considering where your, where your life has turned out. And you're gonna do something you don't love.

• 25:10Speaker 01

  Correct, correct.

• 25:11David Senra?

  For prestige or money?

• 25:12Speaker 01

  He even said, "You needed something to fall back on in case this aviation thing doesn't work out." Well, the aviation thing worked out okay, but...

• 25:20David Senra?

  Did he live long enough to see it?

• 25:21Speaker 01

  You know, he died in 1991, so, kinda, kinda. Uh, he saw me, he saw me have a business. He saw me fly. He flew on one of my first Lear jets, loved it. Okay, but he never, I mean, you know, he would never, he never saw this coming. The only job I can have in law school is a part-time pilot. So I'm a fill-in pilot for a company called J&J Aviation. And J&J Aviation was, uh, was a fraud. I mean, I'm just an employee there, but what they did was, in the early 80s, they had investment tax credit of 10%. And if you bought an aircraft, you got an immediate 10% credit. So they would sell these Citation jets for $750,000. So they had about, a fleet of about six airplanes.

• 26:03Speaker 01

  And then they, they'd sell these Citation jets to investors on the West Coast, a long way from Cleveland. And they would, they'd get the $75,000 investment tax credit. And then they'd pay the $750,000 for the plane. And then the head of J&J was a guy named Jeff Tolk. And every month, he would pretend that these aircraft were on lease, but they weren't. The aircraft didn't even exist. He would make up a dummy statement. He would say, "It flew 40 hours this month. The revenue was, was $90,000. The expenses were $78,000. Here's your $12,000 check." So he simply put the 70, the million five, the two aircraft, and put the million five in the bank and kinda dribbled out the interest in a fake statement.

• 26:45Speaker 01

  Well, finally, after about a year and a half, the owner said, "We gotta see our jets." And they were never, they were always in the air, they were never around. But one day, they, they caught him and he flew the coop. So this little company, J&J Aviation, had like three employees, you know, a secretary, a dispatcher.

• 27:00David Senra?

  And is it just charter?

• 27:01Speaker 01

  Yeah.

• 27:02David Senra?

  Okay, the charter?

• 27:03Speaker 01

  It was using these managed airplanes or these, these Phantom airplanes. But there were six of them. There were Navajos and these little tiny piston engine aircraft. And the dispatcher, dispatcher there, Rick Michaels, calls me up. And he says, uh, he said, "You know, nobody here wants to do this and, and I don't have, I'm not smart enough to do it, but, but you seem to know a little about aviation. You should buy the company." So I call my dad.

• 27:26David Senra?

  And you're how old at the time?

• 27:28Speaker 01

  26.

• 27:29David Senra?

  And you never thought you were gonna be an entrepreneur?

• 27:31Speaker 01

  No, in fact, I didn't even buy this company to be an entrepreneur. I bought it so I could still have a job. Like, I needed to make sure these airplanes didn't go away so I could keep flying. I mean, that was the whole goal. And Rick said he could do it by himself, so I left, I kept, I knew I had to employ the dispatcher and run what... It ended up, two of the planes left, so I had four airplanes when I started. And I called my dad and I said, "Dad, I, I'm gonna, I wanna buy this company, uh, J&J Aviation. I'm actually gonna name it Corporate Wings." And he goes, "Oh," he goes, um, I go, "It's, it's $27,500." And he said, "Well, how are you gonna pay for it?" And I said, "Well, the company has $27,000 in the bank, so I think I can just use their own money to buy them." And he goes, "Oh," he goes, "Well, where are you, what are you doing for the other $500?" I said, "Well, why do you think I called you?"

• 28:14Speaker 01

  So that was really how I bought Corporate Wings. And that company's still here today.

• 28:18David Senra?

  Explain how you get from Corporate Wings to Fluff Jets.

• 28:21Speaker 01

  Right away, I decided, "Where's the, where's the niche for this Corporate Wings?" Like, everybody has a charter plane, like, but how do I get bigger niches and so on? And I, you know, life is timing. I met into, I met someone who worked for Chapman Freeborn. I don't know if you know this company. They move all the rock stars around. So they move the freight. You know, every rock star comes with a stage. And part of that stage can go on the land, part of it has to go in, in big aircraft, depending upon, but the, it's a cargo moving system. And along with that, they had this ancillary business to move the star, to move the celebrity.

• 28:53David Senra?

  I'm watching this documentary on Eagle, The Eagles, the band The Eagles, and they're... They have a bunch of success early on.

• 29:00Speaker 01

  Yeah.

• 29:00David Senra?

  And one of their favorite things about being in a band and being a rock star is that they have this private plane.

• 29:04Speaker 01

  Absolutely.

• 29:05David Senra?

  It's like little like turboprop.

• 29:06Speaker 01

  Yeah. Yeah, the big groups went in those turboprops because they needed 15, 18 seats. It's the single performers that went in the corporate jets.

• 29:14David Senra?

  Okay.

• 29:15Speaker 01

  I flew Elton John, Bryan Adams, Bruce Springsteen, Tony Bennett, Barbra Streisand. Those were the ones, those were my clients. So with Chapman Freeborn, whenever they would get a cargo movement and they needed to move the celebrity, I made a deal with them to do that. And that was how, that was really how.

• 29:33David Senra?

  That was your initial niche.

• 29:34Speaker 01

  But it was really because I wanted to fly and I thought it'd be.

• 29:36David Senra?

  Oh, you're piloting?

• 29:37Speaker 01

  Yeah, of course I am. Of course I am. Sure. And you know what? It was a good gig because you, when you flew those celebrity tours, say a pilot at that time got 7,000 a month. If you flew a three-month tour, you would get 20,000 a month. Of course, you had no, you had no work for that. And it was kind of perfect because I could fly the tour for three months and then have the rest of the time I'd work on the business or, or, you know, kind of learn the business and figure it out. So that I'm building the business concurrently with doing these celebrities. Then I have these big planes, so I start to go more international. I fly, you know, I take, I flew Richard Branson for a year and a half. I live in London. Best flying because I got to learn the world.

• 30:17David Senra?

  Wait, so you're flying Richard Branson now? This is a corporate private jet?

• 30:21Speaker 01

  Correct.

• 30:22David Senra?

  And you're just.

• 30:22Speaker 01

  Remember, to get the celebrities, I had to go to people that wanted to buy a large, like a Gulfstream, a Gulfstream 2 at the time.

• 30:29David Senra?

  Okay.

• 30:29Speaker 01

  And I had to tell them, you use the aircraft, I'm going to lease it out three months a year, which will pay for the aircraft for the whole year. And so I got people to give me airplanes on that financial agreement.

• 30:40David Senra?

  They're putting up the money?

• 30:41Speaker 01

  Yes, correct.

• 30:42David Senra?

  That's how, okay. So that's how you're doing this? Very limited.

• 30:44Speaker 01

  Correct. Yeah, correct. I'm doing it without, without any, there's no Ken capital at this point. I don't even have, I got the $500 from dad. So now, go into the 90s and along concurrent with building this business, once you have the large cabin filling in the rest of the fleets, kind of easy. Because people think if you can do the big stuff, if you can travel the world handling my airplane, so we, is, is, you must be qualified. So we start to build a managed fleet of aircraft till it gets to in the low 20s. And there's, you know, when you build businesses, there's these steps, right? Like without any other help, I could run three airplanes myself. You know, but then if I want to run 15, that's kind of the next step. I need 17 people to run 15 and then I need 17 till I get to 30.

• 31:28Speaker 01

  And then when I get to 30, I need 35 people. There's these steps of infrastructure. So I'm about where I need to be and early, and so in the early 90s, we don't even realize this today. But today, big manufacturers, Gulfstream, Bombardier, Cessna, they pre-sell their aircraft and they don't build them if they're not sold. But going back, so that, going back to the 90s, they looked at it like the car industry. Cessna had a dealer network where people, to be a dealer, you had, the level of dealer, if you bought three single engines and one twin engine, you were this level. If you bought four twin engines, you got this commission structure and you were a larger dealer. But when the business didn't sell, there were all these Whitetails. And so.

• 32:11David Senra?

  Wait, what's that?

• 32:11Speaker 01

  A Whitetail. So a Whitetail is a plane that doesn't have an N number on it? Because they don't know who to title it to because it's not sold.

• 32:18David Senra?

  Okay.

• 32:18Speaker 01

  So it was like the, the auto industry. They kept building, kept the manufacturing run going. And if they couldn't, if sales couldn't keep up, then they just parked them in a lot and called them Whitetails. Well, the Gulf War I happens in 1991. And it goes ahead that these Whitetails, Hawker has these Whitetails and Richard Santulli, who was the founder of NetJets, goes to Hawker and says, you can't sell the airplanes. I'll take 20 of them and sell them on consignment fractionally.

• 32:46David Senra?

  Is that the first?

• 32:47Speaker 01

  This is how fractional.

• 32:48David Senra?

  That is the invention of.

• 32:49Speaker 01

  That's the invention of fractional ownership. Rich Santulli, brilliant, realized that the average company flies an airplane 300 hours a year. A plane wants to fly 1,200 hours a year. So why don't we get four people to share them?

• 33:04David Senra?

  What does it mean a plane wants to fly 1,200 hours a year?

• 33:07Speaker 01

  Well, because if you look at a lot of things, number one is an airplane doesn't like to sit around. They break when they don't fly. The fluids leak out and they, so they want to fly, number one. Number two, they have the capacity to fly 1,000 to 1,200 hours a year. So an average corporate owner at that time was leaving the plane in the hangar five days a week. And so why not utilize that dead asset? That was his, that was his vision. And so he initially thought, well, if I get four people to each put 200 hours on the plane, that's kind of the perfect. So I'm going to shell the, sell the planes in quarters, which is why if you see NetJets' N number today, it still ends in QS. Quarter share. Because originally they only sold 200 hours. Now today you can buy 100 hours, 75.

• 33:51Speaker 01

  But that was his vision and he sold these Whitetails, these consignment aircraft. So he never put up any capital. He said, if I sell them, I'll, I'll give them back to you. So all of a sudden now this becomes in vogue and where is he stealing customers from? Me, the charter operator. Because in the charter business at that time, if you took my plane and went to Florida, I had to charge you to return the plane back to Cleveland. Otherwise, how did I get it home?

• 34:16David Senra?

  Yeah.

• 34:16Speaker 01

  He had the idea of this floating dispatch. I'll drop you in Florida and then the next client, I'll figure out how to get them from here to there. Well, the, that was attractive to a lot of different companies. And so he was starting to steal business. I got a little nervous. So between 1993 and 1996, I'm watching this unfold. And I say, well, he's selling these brand new assets because he's getting them from the manufacturers on consignment. I'm going to go into the used market and I'm going to buy them used, pre-owned, previously enjoyed, I like to say. And I'm going to go ahead and I'll have the exact same airplanes he did. So whatever NetJets had, if they bought brand new Hawkers, I had a used Hawker program.

• 34:59Speaker 01

  If they brought brand new citations, I just emulate them, had a used citation program. That was my vision. I would be buying them used at, at half price. So the service is the same. It's still, you can fly, you only pay for it when you're on board. It's just the buy-in is, is going to be 50%. That was my vision. But unlike him, I couldn't buy these on consignment. I had to have capital to do it. So in 1996, I put together, this is my first time really starting to look at a business. It's the first time I kind of understand the depth that I have to present, the presentation, you know, looking at cash flow and projections.

• 35:36Speaker 01

  And I go out to different banks, probably 35 or 40 of them with this idea of funding me the amount of money I need to start the business. I think I needed 30 or 40 million dollars. I wanted to borrow it. And they look at me and the banks were like, we don't get it. Like where's our collateral? We have the tail of the airplane you're selling out. Like, how do I have a quarter of a plane? So none of them were a buyer. I think at the end of, of 12 months or 15 months of being on the road, I had maybe 7 million of opportunities. If I put up assets equivalent to 7 million, it was the worst financing ever. In June of 1998, Warren Buffett buys NetJets for $750 million.

• 36:18Speaker 01

  And he christens the industry and I just happened to be the guy who saw the banks last. And that summer, I got almost $300 million of debt financing. So again, accidentally wealthy.

• 36:31David Senra?

  Because they're like, well, Warren is.

• 36:32Speaker 01

  Warren's doing what we want in.

• 36:34David Senra?

  It's a good idea.

• 36:34Speaker 01

  That Ken had a good idea.

• 36:36David Senra?

  Yes.

• 36:36Speaker 01

  Yep. And all of a sudden, Bombardier Capital, Boeing Capital, Fleet Bank, all 50 million here, 50 million there, gave me these lines of credit. That had allowed me to buy the initial fleet, which I went active October 13th, 1998.

• 36:50David Senra?

  But what is the company, is it still corporate wings?

• 36:52Speaker 01

  No, I founded, I, I branded that product Flight Options.

• 36:56David Senra?

  Okay.

• 36:56Speaker 01

  That was the brand.

• 36:58David Senra?

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• 37:40David Senra?

  The founder of 11 Labs has a great description of the value Deal can give your company. He said, "We built 11 Labs to break down language and communication barriers. With Deal enabling us to hire and support exceptional talent anywhere, we can accelerate our innovation and bring more voices, stories and ideas to every corner of the world." Deal is trusted by over 40,000 companies and growing fast. Learn how they can help your business by going to deal.com/cenra. That is deal.com/cenra.

• 38:11David Senra?

  So that's flight options. You start with how many planes with flight options?

• 38:14Speaker 01

  Well, once I get the financing, probably 25.

• 38:17David Senra?

  Okay, why'd you pick that number like that?

• 38:18Speaker 01

  There were three different fleets, okay, two light jets and a medium jet. And you need about eight aircraft to be your core fleet. In other words, if you and me are both gonna buy a share of an aircraft, we recognize there can only be one. Because if you and I wanna fly the same day, who gets the plane?

• 38:36David Senra?

  Yeah.

• 38:36Speaker 01

  So you had to show the potential prospect that you had a fleet. And eight was about the number that people, well, oh, you have eight citations. I'll buy one, and then you can service us.

• 38:47David Senra?

  So if you had 25 planes to start out, how many customers? Like, when do you hit your limit? Like, oh, 100 people's too much? Like, what's the...

• 38:54Speaker 01

  No, because, remember, these are core fleet. These planes never get sold. What I do from this point on is if four people buy the citation, I buy another citation.

• 39:04David Senra?

  Okay.

• 39:04Speaker 01

  So these 24 aircraft are always...

• 39:05David Senra?

  So you don't stay with 24, 25 for very long?

• 39:07Speaker 01

  And you know what, that's still a model we use today. If we look at our fleet of 365 aircraft, we would tell you that about 70 of them are core fleet. They don't get sold. They're just there to support your, our customers' ownership and a share of a jet.

• 39:20David Senra?

  Okay.

• 39:21Speaker 01

  Yeah. Because we need that, because on peak travel days, we're gonna have more demand than, there's just not enough airplanes to go around. So we still have that core fleet model.

• 39:29David Senra?

  Okay, so, but this is called flight options?

• 39:31Speaker 01

  Yes.

• 39:31David Senra?

  How do we get from flight options to flex jets?

• 39:33Speaker 01

  Okay, so it's a little longer than you probably hoped. But $100 million in sales between October and December.

• 39:41David Senra?

  For the first three months of...

• 39:43Speaker 01

  David, this was the most amazing thing I've ever seen in my life. People thought it was such a great bargain that they would send me a check. I think the buy-in at that time was like $800,000. People would send a check for $800,000 and say, "Send me the paperwork. I wanna fly tomorrow." In other words, they loved it so much, they knew they couldn't fly till I had the money. They'd send me the checks, and they'd go, "Send me the paperwork. We'll get to that stuff later. Just let me fly."

• 40:05David Senra?

  Yeah.

• 40:06Speaker 01

  So $100 million in the first three months, $400 million in the next year, and now, all of a sudden, I've got a tiger by the tail and no clue. Right? Because a business that grows that fast is immensely complicated, particularly for cash flow. And I think at that time, I didn't really realize that, you know, in capital-intensive industries, particularly like aviation, the balance sheet is the whole game. It's not the income statement. It's the balance sheet. You know, forget income, forget EBITDA. It's free cash flow, and how strong is your balance sheet? That's what drives that business. I didn't know that in 1998. I hadn't figured that all out yet. I'm in my early 40s when this is happening. And so then I bring in an equity partner. So now I have some equity partners around the table. 2000, we have the dot-com bomb.

• 40:51Speaker 01

  So I've been through four recessions. That was number three. So now the business is struggling a little bit. Cash flow's struggling, not volume's struggling. And we decide, you know, when a business is in trouble, there's two things you can really do, or three things. I guess you could close it down. Two is that you can sell it for a song. Or three, you strategically change direction. So you go to the bankers, because your problem is always the credit markets. It's always who's out there for you. And you say, "Oh, I have a new strategy. I'm gonna merge with this company. Here's the projections." And you buy yourself time to see if you can put these companies together. Acquisitions, mergers are incredibly difficult. I hate them. I don't do them very often. I think they're immensely culturally damaging.

• 41:36David Senra?

  Why do you hate mergers?

• 41:38Speaker 01

  I hate them for me, because, for me, I think they're a sign of weakness. Because you can't build your business on your own. You can't... Whatever this company is offering you in terms of, let's say it's market share. Let's say they have a part of the market, you have a part of the market. And you say, "Gosh, we'll capture the market." Well, do you really need to spend 12, 10 times cash flow to gab the market? Would you invest that money yourself and grab the market share? Or do you not have a good enough product to do it? So I think we don't analyze enough what it costs for whatever your logic is for bringing that in. Give me the logic for why you're doing that. And I would tell you 90% of the time, you could probably do this yourself without the acquisition.

• 42:21Speaker 01

  Now, once you do the acquisition culturally, if you have a business built on culture, which is essential for me, it's essential for us, it's impossible. Building a cult, bringing it in, you know, you can integrate a culture if 10% of the workforce is being added. Adding 30%, 40% culturally, impossible. And then you're gonna destroy your culture. So you probably overpaid. I don't know if your business, if the business reasoning is sound, and you really put your culture at risk. So that's why I don't like them.

• 42:49David Senra?

  Okay, so, but you were, this was the...

• 42:51Speaker 01

  I'm in trouble. I'm in trouble financially.

• 42:53David Senra?

  So you have to?

• 42:54Speaker 01

  Yeah, I haven't figured this out yet. You're asking me, this is 26 years ago. I have knowledge that's accumulated since then. So we merged with a company that's also in trouble called Traveler. It's a division of Raytheon. And we slap it together 50/50.

• 43:09David Senra?

  Are they in the same business? What are they...

• 43:10Speaker 01

  Yes, they have a company called Traveler that has a brand-new product line, but also fractional ownership.

• 43:17David Senra?

  Okay.

• 43:17Speaker 01

  And Raytheon owned Beach Jet at the time, Beach Craft, Beach Aircraft. And they had merged it with Hawker Beach. It became Hawker Beach. And so they were trying to see, they had Traveler as a distribution channel for their aircraft. So it's not making money. It's losing $30 million a year. They slap it together with flight options, which was marginally breaking even. We were making money, but not free cash flow. So we put these two companies, consolidate, get rid of the back office. Raytheon wants to focus on missiles and submarines. And in the concept of putting these two together 50/50, we come up with shareholders' roulette. Are you familiar with that term?

• 43:55David Senra?

  Yeah, where you have to...

• 43:56Speaker 01

  You have to make an offer to buy...

• 43:57David Senra?

  Either you buy or sell.

• 43:58Speaker 01

  At the same price.

• 43:59David Senra?

  Yes.

• 43:59Speaker 01

  So I had 18 months to underwrite the transaction. I go to Warburg Pincus. I need an outside, I need an investment partner to do this. They see the model. They value the business at $360 million. I go running up to Lexington, Massachusetts, to go into Raytheon to tell them, "I'm here with your $180 million. This company was a piece of shit, and now I'm here. I figure, where are you putting the Ken Ricci statue that I found, like, I found all this money for you?" And they looked at me, and they thought I was stealing the business, and they bought me out.

• 44:29David Senra?

  Oh.

• 44:29Speaker 01

  And I'm gone. 2002, I've lost my throne. It was the worst day of my life. I was passionate. I loved this business. My friends were in the business.

• 44:38David Senra?

  Hold on, we gotta pause here, because it's very interesting. How much of the 180 cost you personally?

• 44:44Speaker 01

  You hit the nail on the head. You have a knack for asking the exact right question. I own 16% of the company.

• 44:49David Senra?

  Okay.

• 44:50Speaker 01

  Fast forward today, the punchline's gonna be, "I bought this company back, and now I have a controlling interest." So who thought the worst day of my life?

• 44:57David Senra?

  But still, like, you thought, let's go back to, like, you were, you learned how to be a pilot when you were in college. You grew up, you know, middle-class in Ohio. Now you have millions of dollars, and you just said it's the worst day of your life. This is really, really important, because the whole point of this show is, like, I usually talk to people that do things for a very long time. And there's like this new industrial, like, entrepreneur ecosystem, and it's driven by investors, and they tell, they give the worst advice to founders ever. They're like, "Start, scale, sell."

• 45:23Speaker 01

  Yeah.

• 45:24David Senra?

  It's like, I've talked to all these investors, or, excuse me, these entrepreneurs that sold.

• 45:26Speaker 01

  Yeah.

• 45:26David Senra?

  They all talk about like this.

• 45:27Speaker 01

  No, no, no.

• 45:28David Senra?

  If you sold something you loved, they're like, "Yeah, but you're..."

• 45:33David Senra?

  Travis from Uber was in that chair. And he made billions of dollars and lost Uber.

• 45:38Speaker 01

  Yeah.

• 45:39David Senra?

  Ask him how he felt when he had $4 or $5 billion dropped on his head. He didn't give a shit.

• 45:42Speaker 01

  Didn't give a shit about it. Absolutely didn't give a shit about it. Start, scale, get a new investor.

• 45:48David Senra?

  It's crazy. So, okay, so worst day of your life, let's take me to that. You were like, "I thought I was gonna have this company. They bought you out."

• 45:54Speaker 01

  First of all, no one was gonna be more passionate about building that business than me. I don't care who Raytheon put in there. It was never gonna, you know, these businesses are small margins. They're highly technical. There's not an MBA program at Harvard on how to run private aviation. At least, there wasn't at that time. It's become a lot more popular now.

• 46:12David Senra?

  You're in your 40s at this point?

• 46:13Speaker 01

  Yeah, 42.

• 46:14David Senra?

  Married with children?

• 46:16Speaker 01

  Yes, at the time.

• 46:17David Senra?

  How many kids?

• 46:17Speaker 01

  Two children at the time.

• 46:18David Senra?

  Okay, so you got a couple, you know, tens of million dollars, whatever the number is. What's your thought process? Like, where...

• 46:25Speaker 01

  Well, first of all, I always say, "It was the worst day of my life. I lost my throne. I lost my passion for living. I lost the vision. I didn't have any vision, like, what am I doing now?" And then, you know, when you do this, it's horribly conflicting, because you don't want the company to succeed without you, right? You had to be the binding force, so you really don't want it to succeed. But on the other hand, you don't want it not to succeed. You built this baby. Your friends are there. If it doesn't succeed, then your whole idea was for shit. So it's very conflicting. And I got so tired, like, of being in Cleveland and at a restaurant. What happened? People wanted to hear this story. Because at the time, you know, there's 800 employees. So, mostly in Cleveland. So I decided I was gonna move.

• 47:09David Senra?

  This is what we were talking about before. I was like, "Where do you live?" You're like, "Arizona." I was like, "How the hell did you wind up in Arizona?"

• 47:13Speaker 01

  I just decided I was gonna go west of the Mississippi. I was gonna be in a big town. It was Denver, LA, or Phoenix. And LA was a red eye to get back east. So I decided, and Denver's a little cold, so I ended up in Phoenix, and been there since 2003. So now, nothing to do. I'm in Phoenix. At least, I'm not being asked what the hell happened. And Warburg Pincus obviously took a liking to me. That's why they backed me. They said, "We wanna get more into this space. We'd like to give you $250,000 a year. You'll be our executive in residence. You'll find deals for us, and we'll give you a little piece of the action on whatever you do in private aviation." And I was like, well, wait a second. Like, why would I do that first? Why didn't I go find the deals?

• 47:58Speaker 01

  And then decide who I want to bring in? Like, why would I just line up with Warburg? Because then they get to say yes or no on a deal. In other words, I come to buy your company and I have to call Warburg and go, can I buy them? Whereas if I just do this myself, I could come in, make the deal, and then go find the capital. So that's when I started Directional Capital, which was a company met, again, an inch wide and a mile deep. We put our, our, our website went out. We only invest in an area we know a lot about. I knew people in the industry who needed capital at the time. And they came to me because they knew they didn't have to explain to me what was our cost per hour? What was dispatch availability? What was, you know, what was occupied rate?

• 48:35David Senra?

  You knew the ins and outs of the business already?

• 48:37Speaker 01

  And they trusted me and then...

• 48:38David Senra?

  And you're getting equity in return for cash? Is that what you're doing?

• 48:41Speaker 01

  Well, you mean when I...

• 48:43David Senra?

  Yes.

• 48:43Speaker 01

  Yeah, absolutely, absolutely. It's venture, it's, it's private equity, right? And then they always liked my story. Well, Ken, what, what mistake did you make that helped me finance my company? And don't make that mistake. I, I played on that, you know, I, look, I, I can tell you where the, where the bodies are buried. And low and behold, I was working two or three different deals. My, my partner, Mike Rossi, who came in with me in the early 90s. When I kind of transitioned out of pilot into starting to work more on the businesses. We get approached by Allied Capital, who, there was a company called Mercury Air Centers, based Mayland, the West Coast. They're in default on their debt with Foothill Capital, a division of Wells Fargo. And we buy this company for $80 million in concert with Allied Capital.

• 49:26David Senra?

  What does Mercury do?

• 49:27Speaker 01

  I mean, FBOs. They own only FBOs. Fuel, you know, private fuel facilities for private jets.

• 49:34David Senra?

  A lot of people are buying up FBOs right now, is what I hear.

• 49:36Speaker 01

  It's horrible.

• 49:36David Senra?

  Why?

• 49:37Speaker 01

  Well, here's the problem. I started the industry, so I, in many ways, I created this monster. Well, because they're only going to private equity and that we could get into whole, my whole philosophy on private equity. I don't think it's really good. Sorban's Oxy changed in 2000, right? Those Sorban's Oxy rules made it so hard to be a public company. But even those companies that are public, still, if you read their, if you read their annual reports, they have some master besides greed. They have environmental policies, they have social policies, they have policies regarding their employees and their leadership. Private equity has to disclose none of that. They are solely based upon a return to investors, so they're solely about greed. And so they've taken an industry and just tried to monopolize it.

• 50:22Speaker 01

  It's a duopoly now in the FBO industry. Again, I started it because I sold the business to Atlantic Aviation, which is one of the duopolies. They're just pushing the envelope and what's the most amount of money we can abscound with from these wealthy people that buy jets? And they have this new thing called event fees, which they make up in the morning. Lunar eclipse, let's charge an event fee. You know, I mean, it's just, it's just horrible. And I think there's been a real repercussion into the industry now, but we digressed.

• 50:50David Senra?

  But you buy it in early 2000s?

• 50:52Speaker 01

  I buy this Mercury Air Center, these FBO chain, 18 or 19...

• 50:56David Senra?

  What did you like about their business that you wanted to buy it?

• 50:58Speaker 01

  Well, first of all, it was in the vertical I knew. So I knew how to market to corporate pilots. I knew why people wanted an FBO. The business made money on the, on the spread between what they bought fuel for and what they sold it for. So relatively easy business to understand. I had a non-compete. I couldn't necessarily compete in the operating side of the business, so it was available. The non-compete didn't cover fuel distribution or hangar and so on. I can see where it was a very fragmented industry. We had 18 FBOs. It was the second, one of the second largest at the time. And so going out and buying these little mom and pops and giving them 4 million, 3 million, we were buying at six times EBITDA at the time. Today, these businesses, an FBO business will trade at 15 to 20 times today.

• 51:42Speaker 01

  Did that, bought it for $80 million in 2000 and in 2005, and then sold it in 2007 to Macquarie, which now is called Atlantic Aviation. So we built it, about doubled the size of it, and sold it for 615 million.

• 51:56David Senra?

  Oh, so that's where you have a, you're getting a huge chunk of cash now.

• 51:59Speaker 01

  Great. I own 20%. Allied Capital had 80.

• 52:01David Senra?

  Okay.

• 52:02Speaker 01

  Okay, so Mike and I...

• 52:03David Senra?

  That's really good in two years, considering you had to do something and you couldn't do what you really wanted to do.

• 52:07Speaker 01

  Great, great. So, again, the worst day in my life, I don't, I, you know, let's just have faith in the future. I see none of this coming. Right, I see none of this coming. But that's where I get the capital. And what do you think happens next? Raytheon's had enough fun with, with Flight Options. They've lost $600 million in the, in the years they've owned it. The company's become unionized and it's a problem. And it's, it's going to crap. So who do they call? Ken, you want to take this piece of shit off our hands? And what do I say? Of course I do.

• 52:37Speaker 01

  I want my company back. I don't care what shitty position it's in. I want my company back. Think about this one. Financial crisis happens in September, I buy it in December. So how dumb am I? I'm the dumbest guy in the world. I buy this company back in the, in the, in the era of the financial crisis.

• 52:53David Senra?

  And what do you have to pay for it?

• 52:55Speaker 01

  135 million.

• 52:56David Senra?

  Okay.

• 52:56Speaker 01

  Okay, of which the reality is that because there's live, there's payables, there's liabilities, we're assuming. The reality is it was, it was around, it was around 42 million. And I borrowed a 27, I gave a $27 million personal note and 15 million in cash.

• 53:14David Senra?

  What'd you back up that personal note with?

• 53:16Speaker 01

  Just me.

• 53:17David Senra?

  How'd you do that?

• 53:18Speaker 01

  The seller took a note for 27 million. Not a long note, I think three year, a three year note. But I, you know, there were, I had, I had invested in a couple other small businesses at the time. I had, I had assets, I had a home, I had, I hadn't...

• 53:32David Senra?

  Did you have to pledge the home or no?

• 53:33Speaker 01

  Oh, yeah.

• 53:33David Senra?

  Okay, that's what I was getting to.

• 53:34Speaker 01

  Personal guarantee of everything.

• 53:36David Senra?

  That's what I thought. Okay, that's what I was getting to.

• 53:37Speaker 01

  And it did have the $100 million that from the, you know, I used some of that. But I had some, I had some, I had some net worth out there that was, that was viable.

• 53:45David Senra?

  Is this the company that becomes Flexjets?

• 53:47Speaker 01

  Yes, one more step and we're done.

• 53:49David Senra?

  Okay.

• 53:49Speaker 01

  So I inherit Flight Options back. I decide the, the, no, no capital's been invested. I need a new fleet of planes. So I look around the industry, who's got the best fleet? It's Bombardier. They have these Challenger 300s, which are super mid, this is where the market is going. There's these eight passengers, transcontinental, kind of the perfect fit for the shitty planes I have at the time that are...

• 54:11David Senra?

  Can I pause there?

• 54:11Speaker 01

  Yeah.

• 54:12David Senra?

  Because like, you, you said earlier, there's like, there was like 5,000 private jets when you started in the industry in like the 80s or whatever that was. Then there's 35,000 today.

• 54:21Speaker 01

  Yeah.

• 54:21David Senra?

  I think I read, like, almost all of them are in America? Like, what is America's share of that?

• 54:26Speaker 01

  85% of the market.

• 54:27David Senra?

  That's incredible.

• 54:29Speaker 01

  Yeah, people always ask me, what's your, what's your strategy for Asia? Don't need one. Don't need an Asian strategy. There's three flights a day over there. I'm doing 800 flights in the US. Like, what am I strategy to get those last three flights? I mean, what are you thinking?

• 54:45David Senra?

  Okay, so you need a new flight, or you need new planes and you go to Bombardier.

• 54:49Speaker 01

  Right.

• 54:49David Senra?

  Okay.

• 54:50Speaker 01

  So, so what I really want is the Challenger 300, but they have a company called Flexjet. And they have exclusivity. They only have Challenger 300s.

• 54:57David Senra?

  Okay, but Flexjet is also fractional ownership at this time?

• 54:59Speaker 01

  It's a fractional ownership, same by Bombardier.

• 55:02David Senra?

  Okay.

• 55:02Speaker 01

  Based in Dallas. But I caught a good sales guy. I caught this, I caught a guy who was head of sales that, when I told him I wanted to buy 20 Challengers, and at the time they were about 15 million apiece. So when I came up with $300 million order, he scratched his head and was like, am I really going to lose a $300 million order? Because there's this non-compete with a company we own. So he goes to Pierre Baudouin, who was run, the head of Bombardier. The family's owned Bombardier, the Baudouin family's owned that, that, that company for years, still does, control it. And I had known Pierre through YPO. He liked me. And he said, well, Ken knows aviation and why don't you, he tells Steve, the head sales guy, why don't you see if he'd buy Flexjet?

• 55:47Speaker 01

  So I went to buy planes and they sold me Flexjet in 2014.

• 55:51David Senra?

  Why did they want to get rid of it?

• 55:52Speaker 01

  Well, because again, they're in the manufacturing business. To be honest with you, they were financially struggling after the crisis. So picking up, I paid 180 million for Flexjet, picking that up was 180 million they probably needed at the time. With 180 million came an order to buy 20 more aircraft. By the way, with the deal, they made me expand the order to have globals, which I had no idea how it was going to pay for. I had to buy 15 globals and they were 40 million apiece. And I did not have that $600 million.

• 56:20David Senra?

  So where'd you come up with that decision?

• 56:21Speaker 01

  Well, that's, that's again, life is, life is funny. So we signed the deal, we're going to buy Flexjet.

• 56:26David Senra?

  Signing the deal not knowing how you're going to pay for the globals?

• 56:28Speaker 01

  Well, I knew how to pay the 180, no. Like, I did not know how I was going to pay for the globals. I did not know how to... So with, with the buying of 180 million, I placed a billion dollar order for Challenger 300s and globals. And, and actually some Lear jets, which they owned at the time too. So I buy the, I, I placed the order, fingers crossed that we'll ever be able, we'll figure out how to pay for those airplanes later. I got to get Flexjet in here. They call me up, it's, we're going to close like in October. They call me up in September and I get the, by the way, I need to come see you. And I'm like, I'm toasted. I'm, I'm fucked on this deal because they're coming, they're coming to tell me NetJets has beaten my offer. Because there's only three companies left at the time. There's Flexjet, Flight Options, and NetJets. These are the, or the Citation shares too.

• 57:11Speaker 01

  But there's three big companies and the number two and number three are about to merge. And I figure Warren Buffett isn't going to let this happen. He's going, he's, he's in there, he's coming in to, to, to take my bid. So I know they're coming to tell me. And they, sure enough, they sit down and they go, we have a problem with NetJets. And I'm like, oh no. They had globals there also. And they were not, and, and Bombardier claims they were not aware that in the contract when they sold the globals to NetJets, it prohibited them selling them to me. So the message they had to convey was, we can't sell you the globals.

• 57:46David Senra?

  That's not a bad...

• 57:47Speaker 01

  Whoa, 600 million I didn't have to worry about. And of course I went, oh, that sucks. Are you kidding me? This destroys everything I feared and envisioned.

• 58:00Speaker 01

  And now, fast forward, right? Two years later, we do the Gulfstream. And part of that deal, we get exclusivity. So now, we're the only people that can operate Gulfstreams.

• 58:08David Senra?

  Oh, I didn't know this. So wait, FlexJet uses Global to this day?

• 58:12Speaker 01

  Well, see, what would have happened? If they didn't pull that card on me, I would have had to be committed in each category, light jet, mid jet, and heavy jet, to buy into the Barbados product. That was the deal. They didn't want to lose their distribution channel. But they took heavy off the plane, off the tarmac. They took that away because they couldn't sell me the Global. That opened me the opportunity to go ahead and buy the Gulfstreams, which I did in 2017.

• 58:35David Senra?

  Awesome.

• 58:36Speaker 01

  And now, we still buy them today. I mean, we're the largest Gulfstream operator in the world. We have 85 of them.

• 58:40David Senra?

  Wow.

• 58:40Speaker 01

  Yeah, we have more than the US government.

• 58:44David Senra?

  That's a great stat.

• 58:44Speaker 01

  So now, I own FlexJet.

• 58:45David Senra?

  Yeah, and then, why do you decide, okay, I'm going to use that name instead of?

• 58:48Speaker 01

  Well, because Flight Options were for shit, okay?

• 58:51David Senra?

  FlexJet is a better name.

• 58:52Speaker 01

  It had a bad reputation. It wasn't paying its bills. I bought-

• 58:55David Senra?

  Flight Options, because they had fucked it up.

• 58:57Speaker 01

  Yeah, they had lost half their customer base because they gave shitty service. The planes lost capital. They never invested in the planes, so the seats were torn. I mean, it just, the name had a bad reputation, and they were unionized.

• 59:08David Senra?

  Yeah.

• 59:09Speaker 01

  And it's like this bad union reputation, and so FlexJet was the much better way to go for it.

• 59:14David Senra?

  Okay, what year are you buying-

• 59:15Speaker 01

  2014.

• 59:16David Senra?

  2014?

• 59:17Speaker 01

  Yeah.

• 59:17David Senra?

  Okay.

• 59:18Speaker 01

  It takes me the next four years to integrate the two companies, including getting rid of the union.

• 59:23David Senra?

  Why four years?

• 59:24Speaker 01

  Well, culturally, the companies were different. Exactly the same size about, like 300 pilots each, 600 pilots total between the two customers. Remember, you got the shitty hawkers over at FlexJet, and you have the nice challengers at- I mean, the shitty Flight Options and the challengers at FlexJet. And the FlexJet customer doesn't want to be on the shitty hawkers. So the integration of trying to get the systems, the economics of putting the system together weren't that easy.

• 59:50David Senra?

  It was a lot harder than you expected.

• 59:52Speaker 01

  Yeah, a lot harder.

• 59:53David Senra?

  Yeah.

• 59:53Speaker 01

  Culturally, FlexJet was like, we hate the union, and everybody identified themselves, well, I'm a Flight Options pilot, I'm a FlexJet pilot. Just think about, how do you get uniforms to 600 pilots?

• 1:00:04David Senra?

  Yeah.

• 1:00:05Speaker 01

  Right, what do you have to pick? Uniform crossover day. Like, so for a while, you got two different colored pilots flying. You got the blue pilots and the brown pilots. I mean, it just was, it just was very complicated.

• 1:00:15David Senra?

  Okay, but even though you're going through this difficult four-year period, and this makes more sense now, I've got like the whole history of why you hate mergers and acquisitions, and you have a couple of experiences that are bad.

• 1:00:26Speaker 01

  Yeah, I have good ones, too.

• 1:00:27David Senra?

  But are you still really, you strike me as a supremely optimistic guy? You're just like, yeah, I'm going to sell this contract. I'll figure out where the 600 million is coming later, right? Do you still have a lot of faith in the fractional ownership business?

• 1:00:36Speaker 01

  Absolutely.

• 1:00:37David Senra?

  So you're like, you know this is what you're going to do for, this is like your life-

• 1:00:40Speaker 01

  Yeah, not for this program, but if I showed you the economics of how a charter operator works, how a management company works, and how a fractional company works, and showed you top line, bottom line, and margin, it's the only operationally dynamic model. It's the best model. Rich Santilli, he invented this model, and it was brilliant.

• 1:00:59David Senra?

  Okay, so the four-year period, now we're in 2018.

• 1:01:02Speaker 01

  Yeah.

• 1:01:02David Senra?

  Now, you're on FlexJets, you have the uniform pilots-

• 1:01:05Speaker 01

  The union's gone.

• 1:01:05David Senra?

  The union's gone.

• 1:01:06Speaker 01

  Only time a union's ever voted to, for self-representation in the history of pilots.

• 1:01:12David Senra?

  Oh, wow, okay.

• 1:01:13Speaker 01

  Only time, yeah.

• 1:01:14David Senra?

  Now, you have the planes that you want.

• 1:01:16Speaker 01

  Yeah.

• 1:01:17David Senra?

  The kind of planes that you want.

• 1:01:18Speaker 01

  Yeah.

• 1:01:18David Senra?

  Okay. The state of the business there, though, I feel from, let's say, that's eight years ago.

• 1:01:23Speaker 01

  Yeah.

• 1:01:24David Senra?

  Has the business like doubled in size?

• 1:01:26Speaker 01

  Well, quadrupled.

• 1:01:28David Senra?

  Quadrupled, okay. It's a private company, where I'm going to get into the fact that you almost, like, took it public and then fucked that.

• 1:01:34Speaker 01

  Shoot me, but go on.

• 1:01:34David Senra?

  Yeah, and then you paid like, I think, 30 million to get out of the deal.

• 1:01:37Speaker 01

  Thirty million dollars to get out of it. Yeah, 32 million dollar mistake.

• 1:01:40David Senra?

  Well, first of all, why is this so important to you? Because I'm obsessed with like family-owned businesses, private companies. Like, it's just like, to me, like, the ideal situation, you know, I have a bunch of friends that are public company CEOs.

• 1:01:49Speaker 01

  Yeah.

• 1:01:49David Senra?

  And they all secretly hate it, by the way. But like, why was it so important to like, in addition to, let's take away like the reporting and how difficult it is running a public company, but like, why did you want to keep your company private?

• 1:02:00Speaker 01

  Because I believe in a higher being. I think there's a purpose we have beyond wealth accumulation, okay? There has to be. I've always struggled, and of course, I went to Jesuit High School, so of course I was, of course I have the guilt gene. But I've always struggled with the question, like, why am I here? It took me till 2018 to really find who I am, why I'm here, to all come into alignment. And it's crystal clear in my life today. I always struggled with it. I could go back to conversations in the late 80s and late 90s, when I was starting the business, and I'm asking, how does this business serve others? And I think fundamentally, I always knew my life had to be about serving others, but always shied away from wealth, because that didn't seem like, wealth doesn't serve others, it serves me, right?

• 1:02:45Speaker 01

  You can have, there's very, you know, wealth seems to be very tempting. So it took me a long time to find my life-

• 1:02:54David Senra?

  Before we get to 2018, you're figuring this out. Take me to some of these conversations where you're like questioning this. Like, what's your inner monologue? Are you sharing these thoughts with other people?

• 1:03:01Speaker 01

  Yeah, in fact, probably, you know, if you were to ask me like some of the most influential people in my life, one of the most influential was Father Ted Hesper, who led the University of Notre Dame for 35 years. You know, he ran this amazing institution. He grew it from going broke during World War II, because they had no students, to becoming one of the most prominent universities in the world today, right? And he did that over a 35-year, 10-year as president. And he had an amazing business sense, as well as being appreciative. So, you know, he was an amazing resource and had amazing insights. And I remember going to him at a time, he retired from president, so he was very available. I ran the student government when I was there, so I knew him from my days at Notre Dame.

• 1:03:44David Senra?

  And so, you go to him.

• 1:03:45Speaker 01

  And I asked him a question. I asked him, I said, you know, I'm pretty sure that, I'm pretty sure that Jesus was not a capitalist. I'm pretty sure he had to be a socialist, because I don't recognize anything in what I was taught about why we are here in the life of capitalism. I don't see that. I'm not finding that. And I said that to him, and he looked at me and he said, I have two thoughts for you. Number one, it can be if it consumes you. I actually said to him, I said, you know, I got a shitty gift. You know, if I could cure cancer, that would be a great gift. If I could like heal the poor. I mean, there's a lot of good gifts. There's a lot of very altruistic gifts. I don't have that gift.

• 1:04:29Speaker 01

  I got the gift for looking at a balance sheet and understanding how the business can translate to the balance sheet. I understand that, that's my special gift. And he said to me, yeah, you can, God thought enough of you to give you that gift. You're going to be tempted your whole life with being selfish with this gift, or thinking about how to continuously use this gift for others. But God had enough confidence in you to give you that gift, and so, run with it. And number two, he told me, don't overthink this. He goes, life is really simple. We want to make it, we want to make it so complicated. To have a life of significance, you only have to do three things. Be true to your God, be as good as your parents, and champion the causes of underdogs.

• 1:05:13Speaker 01

  He didn't say be a Catholic, he didn't say be a Christian. He said, be true to whatever you think is why you're here in existence. Be as good as your parents. Our parents are flawed in so many ways. He didn't say be the perfect parent, but parents come with a genuine acceptance that they want to give life, right? So he said, be as good, and then champion the cause of underdogs. Always look around the room, find the underdog, and go to them.

• 1:05:36David Senra?

  Okay, so you're having these conversations with people you trust and yourself for several years. And then, you said you didn't really figure out why you're here until 2018. What was the answer that arrived in 2018?

• 1:05:47Speaker 01

  I want to know my immediate, my immediate reaction. So remember, I'm still doing a little bit of flying. I'm flying these rock stars. I'm flying Bill Clinton at the time, actually. And I'm reading, because when you're a pilot, you have a lot of time to read. You're waiting a lot. And I read a biography about an Indian chief, and in order to become head of his tribe, become chief, he had to prove that he was worthy of the tribe, and that meant giving away all his worldly possessions. Somehow, this sticks with me. I have the conversation, and in 1992, I decided to give away everything to prove to myself. I saw one of your guests talk about, I think it was about having a tooth procedure without Novocain to prove he had courage.

• 1:06:28David Senra?

  Everybody's seen this. That clip got tens of millions of views.

• 1:06:32Speaker 01

  That's how I know it. That wasn't my courage. My courage was the giveaway of my assets.

• 1:06:37David Senra?

  And then, to build them back up?

• 1:06:39Speaker 01

  Well, it didn't matter. I had to prove to myself that my, that that wasn't what ran my life, that the accumulation of wealth wasn't going to be what ran my life, that I had the courage to use the talent I had, not for self-accumulation.

• 1:06:53David Senra?

  Okay, so this is kind of what we were talking about before we were recording. I told you this fantastic launch I had with Sam Zell. And his whole thing was just like, he's like, I know all the rich guys. You'd be surprised how miserable most of them are. They have more money than they'll ever spend. They trade time, which they can't get more of, doing things they don't like for more money they can never spend. He's like, there's only one true luxury in life, and that's like, get to private jet money. That's what, that's the advice that he gave me. Because he's like, he's bought everything in the world, and he's just like, it doesn't matter. It's just like, the thing that made him the happiest wasn't his compound in Malibu or his place in Chicago. It was that every year, I think, between Thanksgiving and Christmas, he took his entire family, his extended family and everything, and he was able, it was like 35 people, and he would take them to this little village in France for a few weeks,

• 1:07:38David Senra?

  and be able to pay and provide that experience for every single person, right?

• 1:07:41Speaker 01

  Yeah.

• 1:07:41David Senra?

  And his whole thing was just like, you're not like going to be happy on the things that you consume. It's the things you do for other people. Exactly, what you do for other people.

• 1:07:49Speaker 01

  You're happy in what you give away, not what you take in.

• 1:07:50David Senra?

  So, but bring me to this like realization, so you did that in 92, but to bring me to this realization in 2018, where you're just like, now I know for sure.

• 1:07:58Speaker 01

  Well, let's just say two things, right? In 92, even though, you know, now I'm, now I'm giving away everything, so I have not, you know, that was a, that was a proof of Ken. But again, I didn't have a lot of wealth. I had that nice event, I had the nice event in the mid, I mean, don't get me wrong, I'm wealthy, but I'm not this wealthy, okay? You know, today, I mean, it's a factor of 40 compared to what it was in 2006, right? So, but, but, but, well, I don't, you know, that just means the temptation gets greater.

• 1:08:27David Senra?

  No, no, it's not the temptation, it's just like, one of my favorite lines in the history of entrepreneurship is that, it comes from Henry Ford, he says, money comes naturally as a result of service. And so, his whole point is like, you want to make more wealth? That's fine.

• 1:08:37Speaker 01

  Don't ask me why.

• 1:08:37David Senra?

  Find a way to make somebody else's life better?

• 1:08:39Speaker 01

  Yes.

• 1:08:39David Senra?

  And then, the way you make more wealth is create, is increase the amount of people's lives that you get better.

• 1:08:44Speaker 01

  Correct.

• 1:08:44David Senra?

  And if you just focus on service, the money will come back to you.

• 1:08:46Speaker 01

  Interview's over, you just captured everyone, right? I mean, I will tell you, I mean, if you ask me, I would say, look, six things. Be passionate about what you do, compassionate about how you do it. Memories are worth whatever they cost to, whatever they cost to create. Friendship is a one-way street. It's only what you do for your friends, it's not what they do for you. Don't miss the best five days of your life. These are, these are, you never know what they're going to be. So wake up every day with the idea that, what a wonderful day this could be, right? So those are the things that cross my mind. And by the way, there's no downside in doing something for somebody you don't like. Doing something good for somebody you don't like. No downside in that.

• 1:09:25David Senra?

  I think it's excellent advice. That's a perfect place to close our first conversation. I really enjoyed meeting you. I was looking for, I've heard nothing but great things about you. I will end a little different than I normally do. What I will say about your business is a lot of my friends use FlexJets, and they all talk about the same thing. It's like you have remarkable customer service. And these are highly disagreeable, you know, high-powered entrepreneurs that are not easy to please. So you should be very proud of the business that you've built, and one that's growing rapidly right now. And I hope you hold on to it. I know you just sold about 20% of it, whatever the case is, but I think there's good things in the future of FlexJets.

• 1:09:57Speaker 01

  Let me say one thing about customer service, because you brought it up. One of the keys to customer service is, you know, if there's a problem, because customer service is about what you do when things go to hell. It's not about what you do when things are going well. Within our organization, there is no approval process. The person you talk to on the phone, when you call and schedule your trip, and you say, we had a breakdown, I got to get this, that person has all the authority to comp your trip, to give you whatever money they need. They don't have to call a supervisor to say, David needs help. So I empower everyone in the organization, at whatever level. First of all, it says trust, which is the foundation of, that I trust us throughout the organization, that carries trust to that person. But this is a person making $80,000 a year that can comp you a $300,000 trip.

• 1:10:41Speaker 01

  So that's how we think about customer service.

• 1:10:43David Senra?

  I love it. Thanks.

• 1:10:44Speaker 01

  Great, great.

• 1:10:46David Senra?

  I hope you enjoyed this episode. Please remember to subscribe wherever you're listening and leave a review. And make sure you listen to my other podcast, Founders. For almost a decade, I have obsessively read over 400 biographies of history's greatest entrepreneurs, searching for ideas that you can use in your work. Most of the guests you hear on this show first found me through Founders.