Capacity Acquires $5m ARR Bootstrapped YouCanBookMe To Build AI Support Mega Platform

50% Cash, 50% stock. Bridget Harris grew You Can Book Me from 0 to $5M revenue over 12 years. David is building Capacity (previously at Answers.com which sold for ~$900M). Today, Capacity acquires YouCanBookMe in a big win for bootstrappers!

• 0:04Speaker 00

  You are listening to conversations with Nathan Latka, where I sit down and interview the top SaaS founders like Eric Wan from Zoom. If you'd like to subscribe, go to Gitlatka.com. We've published thousands of these interviews. And if you want to sort through them quickly by revenue or churn, CAC, valuation, or other metrics, the easiest way to do that is to go to Gitlatka.com and use our filtering tool. It's like a big Excel sheet for all of these podcast interviews. Check it out right now at Gitlatka.com.

• 0:38Speaker 00

  Folks, I am grinning big today because we have a real treat. Over the next 25 minutes, you're going to learn the story of that grind, that 12-year bootstrap hustle from zero to $5 million of revenue competitive space from Bridgette Harris, who cut her teeth in politics before launching You Can Book Me about 12 years ago. They're about to make an announcement, which I'm not going to steal the thunder from. They'll do it in a second. But she has now teamed up with David at Capacity, who's a seasoned entrepreneur, cut his own teeth, teeth, starting in 2011 at answers.com. One of the, we'll call it one of the fallouts of the 1999 heyday, but went public, went through a pipe, went through a take private, went through a majority, went through a secondary, ended up selling that business for about 800, 900 million bucks before launching Capacity,

• 1:23Speaker 00

  which is now focused on helping entrepreneurs enable and get their support done quickly, providing great customer support, all leaning in to this AI revolution we're living in. On that note, David, Bridgette, are you ready to take us to the top?

• 1:36Speaker 01

  Let's do it.

• 1:37Speaker 02

  Let's do it.

• 1:38Speaker 00

  All right. Well, David, first off, what's the announcement? What happened recently?

• 1:42Speaker 01

  I am really excited to announce that Capacity has acquired You Can Book Me. This brings world-class online booking into our collection of AI-powered platform pieces. And so one of the biggest use cases we've had for Capacity is when folks want to automate their booking process. And now we're able to do that on the tune of a million bookings a month.

• 2:09Speaker 00

  That's incredible. Now, Bridget, I thought it would never happen. I'm going, there's no way. It's just, this is never gonna happen. She's got profit sharing plans set up. You know, she's in full control. She's doing this with family members. This is great. Help us understand sort of what, what, right before you guys signed the M and A deal and it closed, what did you grow revenue to and what ultimately made Capacity the right fit for You Can Book Me?

• 2:36Speaker 02

  So we had, we've got You Can Book Me running at a really nice $5 million a year. Profitable, as you know well, you know, I've spoken a lot about creating profit, which you need to do if you're bootstrapped over long term. You need to start making money

• 2:51Speaker 02

  to make it worthwhile, frankly. So we've got to that stage and really at the end of the day, I'm looking for, how do I get You Can Book Me to the next level? How do I get this, you know, this business that we have built, which has, has got to a point which is really exciting, really something that, you know, means something for our team, our company, but also our customers? How do we get it to the next level? And actually, there's a combination of reasons why. And I should say at this stage, you know, we didn't go through a process. We weren't for sale. We didn't put up some big estate sign, you know, up in our, in our lot. Capacity approached us and we like, we really liked the offer. We liked, we liked the fact that they're in customer support and AI for customer support.

• 3:35Speaker 02

  It's a huge problem that needs to be solved. We know it. We feel it inside You Can Book Me. So I knew that, you know, what they are doing, what they're, what they're building for their own customers is a really strong product offer that we know our customers could really benefit from. There's a huge amount of synergy, as David was saying, that all of those guys need scheduling and we need, you know, we, we need to find a vehicle to scale and grow what we do. So there was a lot of synergy there. And I think also that the team itself and the way they approached us, it was really respectful of us being a bootstrap company, of us having our own, you know, our own engine that we grow through product-led growth and self-serve. And there was something very kind of obvious about.

• 4:19Speaker 02

  The deal, I mean, as one of those things, whereas we got closer to the deal, the day before we signed and everything else, it got easier and it got more exciting to look forward to the day that we were closing as opposed to harder. So I suppose, you know, when you're selling away your life, you might at the point of about to sign, sit there and go, am I doing the right thing? You know, is this a disaster? And actually, genuinely, and there's a story to tell you about it, Nathan, but genuinely, the night that we signed it, we were so happy that we just got to the point where we we know that this is the right thing to do for us.

• 4:50Speaker 00

  And what night was that?

• 4:51Speaker 01

  You were at a Paul McCartney concert that that night.

• 4:54Speaker 02

  We told the lawyers on the day, it was it was just before Christmas. We told them on the day, we have to close today because we're going to see Paul McCartney tonight. And no matter how important, you know, the capacity team are, and you can book my team and all the lawyers and how expensive it all is, Paul McCartney is more important. And so we went off to see Paul McCartney in the O2. It was obviously an amazing gig. And we were on a train on the way back from London to Bedford, where I am now. And the whole thing happened over a call, you know, on our train back full of drunk people coming back from London. But it was so it was a fantastic night for both reasons.

• 5:29Speaker 00

  December, what, December 22nd, 23rd, something like that?

• 5:31Speaker 02

  Eighteen, eighteen.

• 5:32Speaker 00

  Eighteen, December 18th.

• 5:34Speaker 02

  And then we've been in, we've been in hibernation, Nathan, to then we've been sort of reeling from the shock.

• 5:38Speaker 00

  Yeah, no, it's great. Now, before I jump more into the story, the backstory, the negotiations, you know, things to look out for, both on on both sides, the acquirer and the one, the group being acquired. Bridget, is this, are we pretty much on the spot here in terms of revenue growth or any corrections you want to stick in here?

• 5:52Speaker 02

  Uh, yeah, no, no, we hit one million, sort of much more in the 2016, 2017 marks. It was a bit, it's a bit more sort of, it's less of a hockey sticker, more of a, of a, of a nice, a nice hill.

• 6:02Speaker 00

  But about, but about five million at exit?

• 6:05Speaker 02

  Yeah, yeah, yeah.

• 6:06Speaker 00

  So David, let me pivot over to you in capacity because you told me in our pre-call, you have a thesis. You built a list of 24 key items you think every company needs when they think about inbound and customer support. And you said, quote, we're going to go build or buy in all of these spaces. Which of those 24 items led you to searching for booking tools and then ultimately led you to email Bridget?

• 6:29Speaker 01

  Yeah, so when we think about the 24 steps of the customer experience journey, we can kind of divide them into three buckets. You've got self-service, so that's where a consumer can get help from an AI agent without having to talk with a person, without having to fill out a contact us form, without having to place a call to a human. That's where we started. That was kind of capacity's bread and butter. It's where we have a lot of product entry points in that part. What we realized as we got into it, though, and that was kind of the original thesis of capacity when we launched back in early 2017. Big thing, though, that we realized is that no matter how good your AI system is, you have to be able to handle the questions the AI doesn't know how to answer. So the second big pillar that we focus on is this whole agent assist concept.

• 7:14Speaker 01

  How do we help support teams do their best work when something does need to escalate up to a person? As we got into it, we started working with a lot of these support teams, particularly marketing and sales support teams. They're like, David, our biggest workflow is being able to get leads into our business, being able to book appointments, being able to bring people in. And so our third bucket are those kind of campaigns and workflows. We have other types of campaigns we do, SMS campaigns, voice dialer campaigns. We have multiple types of workflows we support. But scheduling is one of the biggest ones that we've been handling for years, starting internally and then going externally. And so we looked at this and said, wow, if we could find a company that's doing this well at scale,

• 7:57Speaker 01

  I think there's a great opportunity to combine our self-service AI and our agent assist tools together.

• 8:04Speaker 00

  Bridget, I'm going to keep asking David questions. While I'm doing that, though, can you open up your email inbox and search his email? And go, when you find it, read to me the subject line of the first email he sent you?

• 8:15Speaker 02

  Okay. Nobody's asked me that, Nathan. You ask me so many unexpected questions.

• 8:19Speaker 00

  Well, because David, you know this, like, right? I mean, it's something like Bridget is busy, right? So like, you're sending out these emails to potential people to acquire, and you've got to get the response. You've got to say it in a curious way that gets her to say, okay, I'm interested, when she's like been all against sort of exiting, right? All against the VC world and just wants to bootstrap.

• 8:36Speaker 02

  That's true. Well, no, I was going to say, the first time they contacted me, I said no. So there you go.

• 8:41Speaker 00

  Yeah, well, I'm curious what the email subject line was. But David, what do you have a? Okay, David, do you have a process? Did you only reach out to Bridget? Or did you reach out to, you know, 15 companies in the scheduling space?

• 8:53Speaker 01

  The first thing we do is we use competitive research tools. I know a great one that has a lot of great stats around SaaS companies that you might be familiar with.

• 9:03Speaker 01

  So we use tools like GetLotta to go look at.

• 9:06Speaker 00

  Oh, nice.

• 9:08Speaker 01

  I gotta give the plug, right?

• 9:09Speaker 00

  No, I appreciate it. Thank you.

• 9:11Speaker 01

  To go look and see where where people are at. And you know what? Every data point isn't always 100% accurate, but it's directionally correct and enough for us to know, are we going to talk with someone who's at 50K of ARR, someone who's at 50 million of ARR, probably outside the range in either side of what we can go do. Let me make our list and then I I will go through and look at each individual website to see if there's anything amiss. And just just to make sure it looks like there's a heartbeat and a pulse there. Then we have a process where we send out a bunch of different types of reach outs, some by LinkedIn, some by email. Occasionally we'll also do some calls.

• 9:50Speaker 01

  And the idea is it's like, hey, here's what we're doing. Founder-led company, sold my last company for north of 900 million. We're in this AI powered support automation space. Would love to talk and see if there's any ways we can work together. And sometimes it might come out of that and it's like, eh, not a good fit. Or sometimes it come out, I would love to acquire them. Price isn't right. Sometimes it come out of a conversation, it's like, there could be a partnership there. And then every once in a while, we come out of a conversation like that, like, let's go turn over the next cards. Doesn't mean that we're the right fit for them or they're a right fit for us. But there's a there there worth at least exploring and having that conversation.

• 10:32Speaker 00

  And and you've, just to give you some credit, while Bridget continues digging through her, I'm sure very busy Gmail inbox or email inbox. I want to make sure we get your story sort of plotted accurately as well. So based off our research, Capacity has acquired, I feel like, six companies, including the Lumen box in 2016. Is that right?

• 10:52Speaker 01

  I think the total number is up to, I think, eight or nine at this point.

• 10:56Speaker 00

  Eight or nine now. Okay. And do we, we generally have your revenue profile accurate? You broke the five million mark in 2019 and now we're at about forty, forty-five million, fifty million?

• 11:07Speaker 01

  Uh, we're right at about forty-three million to end, end last year. Correct.

• 11:11Speaker 00

  Okay, four, okay, great, great. And is it, I get the five million right in 2019? Or is that too early?

• 11:16Speaker 01

  Uh, I have to go back and look at it. It sounds directionally correct.

• 11:20Speaker 00

  Okay. And where did you, you know, there's a lot of people listening right now that potentially want to sell to a group like Capacity or want to bootstrap like Bridget. There's also folks that want to go start their own version of Capacity, maybe like with a search fund. Where did you get the initial capital to get going on this? You, you weren't the original founder at Answers.com, so I don't know how much you actually made when the company did the, you know, the secondary sale for nine hundred million bucks, but where did you get the original capital?

• 11:44Speaker 01

  Yeah, so I was the original founder of a company called Announce Media. We, we acquired Answers.com. We did a international take-private levered transaction for that. We had some private equity sponsors to help us there. So I did well in the Answers.com exit. Didn't make as much money as the private equity guys did, but I, I did well enough that I could use some of those proceeds toward future endeavors. And so when we started Capacity, we, our first seed round was basically just insiders. My business partner and I, and then team members early on who wanted to invest.

• 12:20Speaker 00

  And David, did you sell like most people in the seed round? I mean, you're selling fifteen to twenty percent of the business. Were you in that same range?

• 12:25Speaker 01

  Yeah, somewhere in that, somewhere in that range.

• 12:28Speaker 00

  Okay. And how, was that the 1.6 round and twenty-seven million in 2017?

• 12:32Speaker 01

  Uh, that's correct. Yes.

• 12:33Speaker 00

  Okay.

• 12:34Speaker 01

  And then the idea was that we didn't want to go take outside money until we had, uh, revenue customers and proven that we should exist. And then when we did that, we were able to have a much more sizable valuation in that next round. And I wasn't pitching people an idea. I was pitching people a business. And so one thing, your listeners who are super on the early stage of their journey might consider is whatever you can do to Raise as least money as possible in order to get to that first dollar of revenue. I highly recommend that because you can keep more control, you can keep more ownership, and you don't have to give up the farm when you're still in the idea phase.

• 13:15Speaker 00

  What did you pay though for Lumenvox? I mean, was that a company you launched from scratch or you purchased? And if you purchased it, what was the total cash you had to pay to get that business under your belt?

• 13:24Speaker 01

  Yeah, we don't disclose the acquisition prices for deals, partly because we've got a combination of cash, equity, seller notes, earnouts that we do. So we don't ever disclose what we pay for these things. But at a really high level, you can think of it as up through, right around the pandemic time, we were a single-channel, web-only, customer support and employee support platform. So if you wanted to go automate support for team members or customers, we could help you with that. When, our biggest market at that time was in the mortgage space. And if you remember, mortgage was white hot, interest rates were free.

• 14:04Speaker 01

  And then, pretty soon after, Powell hit the brakes on the whole economy. And then, we were literally on calls with clients that were getting fired in the middle of our calls. So, we went from being 75% mortgage tech at that time to saying, okay, we're gonna need to diversify the categories we're in. We need to go after, because it wasn't our fault, mortgage was a cyclical market. The second thing though, is we need to be able to go after the highest value,

• 14:40Speaker 01

  highest value types of activities as possible, which means we either need to get into a more expensive support, which led us into voice, or we need to get tied back to revenue, which is why plugging in with bookings and scheduling makes a ton of sense. So, we went from single-channel, web-only, largely concentrated in one industry, to saying we're gonna go and be diversified across industries, diversified across channels. And that means we're gonna need to support SMS and voice and social and anywhere where you might get an email or a ticket or call.

• 15:15Speaker 00

  I want to go back to Bridget, because I'm sure she's found the original conversations. Before I do that though, David, just to sum up, so we talked about revenue and the number of acquisitions, that capacity, you've raised, what's the total you raised to date for capacity?

• 15:27Speaker 01

  Just under 100 million.

• 15:29Speaker 00

  Okay. And the last run was, I believe, in October for 26 million of Series D?

• 15:34Speaker 01

  Uh, yes.

• 15:36Speaker 00

  You hesitated there.

• 15:36Speaker 01

  A little bit because we had some, we raised a little bit more on top of that, but yes.

• 15:42Speaker 00

  Okay. And, and most people, you know, once you get past Series B, Series C, you can get down to the point where you can negotiate, especially with your background and answers, and you're only selling, you know, call it maybe four, five, six, seven percent of the business. Were you sort of in that range for the Series D?

• 15:56Speaker 01

  So the way that we think about it is we, we look at, we looked at doing our capital raise in a totally different way than most other companies do. So most companies, you start out, maybe you have a seed round, then you go off and you go bring on a VC. Then you're maybe trading one VC, early-stage VC for a late-stage VC. Uh, sometimes you're going into a third, a third VC at that, at that point. And then you end up with this scenario where the founder is diluted, the founder doesn't have board control. And then when they want to sell or buy or raise capital, they get squeezed. I've seen this story. It's like, it's like one of those, uh...

• 16:35Speaker 00

  Well, David, this is what I'm asking. I can just cut to the real question, which is how much equity of capacity do you still own?

• 16:41Speaker 01

  I own just under a third.

• 16:43Speaker 00

  Okay. And you still have board control?

• 16:45Speaker 01

  I own a third of the, of the equity and I have, uh, my business partner and I have complete board control.

• 16:50Speaker 00

  Okay, that's awesome. Great. Okay. Bridget, subject line. What was it?

• 16:55Speaker 02

  Just on that last point though, Nathan, I mean, and this is kind of counterintuitive to every single corporate lawyer doing D and D. The fact that David and Chris have complete control of capacity was a plus point for me and Keith, uh, not a negative. Because for us, we feel like we're, we're, you know, handing over a founder-led company to a founder-led company, which is really important to us.

• 17:13Speaker 00

  This is why I pushed on this because I'm going, has David actually gone through a Series D and still kept more than like 10? I mean, most Series D founders I interview, they have like 5% of the company left, 10% of the company left. So it's great that David and crew have done that. And obviously, Bridget gives you, it's way more aligned with how you think about business building too.

• 17:29Speaker 02

  Yeah. That's it. I mean, the lawyer said, are you sure they have complete control? It's like, well, we have complete control. So, you know, as long as you're comfortable with that. Uh, do you want me to share my screen? Because I found it. It was on LinkedIn.

• 17:38Speaker 00

  Yes, as long as David and you are both comfortable, of course. This is awesome.

• 17:43Speaker 02

  Right, this is, this is it. This is what I got in LinkedIn. This was in March. This was March 2024. I sold my last company for 960 million, Nathan, so you have to put that into your book, and started a new one, capacity to help automate support. We have around 2,000 clients across the globe. Given the overlap with what you're doing, I love to sync up repartnership or M and A opportunity up for a quick call, David. And then, um, this is the best example, an advert for my tool. I just sent him my scheduler.

• 18:12Speaker 00

  Get him a day, plus one user. Did he convert to a paid account?

• 18:18Speaker 02

  Uh, I think, I think Marcus.

• 18:20Speaker 01

  Capacity people move over to paid accounts pretty quick.

• 18:22Speaker 02

  Yeah, yeah, Marcus upgraded. Um, okay. So the next, the next call I had them with him was, was a bit of a support call because, you know, Marcus had upgraded. He wanted to ask a few questions. So, yeah, I mean, that was, that was it. And that was in March. So there was, there was some way to go. And again, I wanted to emphasize for your audience that, you know, we weren't running a big process. We weren't sort of trying to kind of, uh, get out at any cost. We, we, we sold because it was the right thing to, because that approach, uh, it didn't, we didn't sell in March, but it, it started a relationship and a conversation that then led to another couple of conversations in September, October that led to, you know, Paul McCartney, Paul McCartney Day.

• 18:59Speaker 00

  Yes, you, you, you tech, I went back and looked through our texts, Bridgette, and this is why I love doing what I do at Founder Path, right? We're helping founders keep equity as they grow and hopefully make more when they exit. We did not have the privilege of backing Bridgette and you can book me with debt because she just didn't need it and they were very happy and it is what that is. But you did text me on October 7th. You said, quote, "I have an acquisition offer I'd love to chat with you through to get your advice. If you're in London, we could do face to face." Um, and so, uh, David, she was very good about holding back all the names and the details, but I do remember Bridgette, we had a really good brainstorm and you were asking really good questions. I could tell you were seriously considering it because of the quality of questions you were asking. When did though push come to shove, right? When did the, no, David, to your point, there's the total deal price

• 19:40Speaker 00

  and then there's the structure and these are very different, right? The total deal price could be 60, I'm making this up, 50 million bucks, but the structure could be 10 million cash, 10 million stock, 10 million earn out, sellers notes, et cetera. When did the total just deal price, not the flavor of the deal, but the deal price, when did that really come out?

• 20:00Speaker 01

  Yeah, I think the first thing that we did was just focus on is this the right fit? And I don't, I don't want to like jump past that because uh I'm a like both at individual level and at the company level. Like I've worked with brilliant, like just a quick story. Worked with a brilliant uh uh brilliant product person at one point and he came from a larger organization and was an awesome fit for a large organization, but couldn't multitask at a small scrappy startup. So wasn't he was a bad person or I was a bad boss, it just wasn't the right fit. And so when we, when we tried to look at which companies we can go partner with, we need the people.

• 20:44Speaker 01

  And so part of it is like, we got to find people where, where there's a good mutual fit. And if, if the company we're trying to acquire doesn't view us as being the right fit, there's no way it's culturally going to work.

• 20:53Speaker 00

  And Bridget, how many people were you full time?

• 20:56Speaker 02

  Uh, we're about 22 people full time and we ha- we actually have an overall headcount of around 35 people. If you include all of our contractors and things.

• 21:03Speaker 00

  Okay. So David, back to the people side. Yeah.

• 21:05Speaker 01

  After you've determined, hey, I think there's a good cultural fit here. I think we can work together. Then it's like, okay, well, what are the, what are the hot button items? We have some companies we've acquired where they had existing debt we had to go take on.

• 21:19Speaker 00

  Oh wait, let's, we have a real example here. Let's try to use real, I mean, Bridget, what were the hot button items in the steel?

• 21:24Speaker 02

  Um, so for us, the, it was actually, so if you'd asked me a couple of years ago, Nathan, if you and I had been talking about, about us being acquired, I would have told you a hundred percent that I would have wanted to sell and walk away. I would have wanted a hundred percent cash on close and I'm, I'm, you know, I'm riding off into the sunset. Because I believe that that, that, that was the only way that made sense for us to, I'm either running my company or I'm not. But I'm not going to go in for some sort of hybrid deal. Now, as we got to know David's offer and the, you know, he's obviously got a team as well that was working with us. Um, and it, it did evolve. We did go back and forth. There were certain things about, you know, exactly, you know, how much equity, how much cash, all the rest of it.

• 22:06Speaker 02

  Uh, but at the end of the day, what I actually felt quite comfortable was, was the fact that we're not riding off into the sunset. We're becoming investors in capacity. So it was really important to us that we like the team, that we liked the founder, that we like, you know, as I said, I'm in, I'm in favor of founder-led companies. I'm in favor of founders having a hundred percent control. And for me, the hot button topic was I didn't want to feel. Like we were selling, you can book me and we were, I don't know, that we were slinking away. Like actually this idea, they're like, oh, I don't, I don't want to do that anymore. I'm off. I actually wanted, I started to strongly feel that we needed continuity. I needed the story of you can book me and the company and the product and everything we've worked towards. There needed to be some continuity there that I could be a part of, that I liked.

• 22:50Speaker 02

  So essentially it was almost like, and we did feel a little bit like this on the day that, the day after close. All of us have felt like we've applied for a job to work for capacity. You know, we're all, we've all started to work for capacity now. And that needed to be as good and as important for me and Keith as anybody else. So I didn't, so the alternatives for us would have been private equity. You know, all of these huge vehicles that come along and try to scoop up loads of SaaS companies at about our kind of level. Um, and we all know their names, you know, they're absolutely massive. Um, and for me, I think I'd always have felt like, even if they'd given me double, even if I'd got double, double the amount. I'd all, I would always have felt like I was walking away from something that I helped create, that I think I'm very proud of.

• 23:32Speaker 02

  Um, this way, and so I, I never did it. We got offers. In fact, we got offers. Over the last couple of years, we've had quite a few offers, but I never wanted to do it because I didn't want that feeling. And I think that the, the point that I realized we could sell was actually, was when we went to St. Louis in Missouri, where capacity is based. Me and Keith flew out. So to try to reduce the amount of time for DD, we did a face to face, which I'd never done before, but I a hundred percent. I recommend it. So me and Keith went to St. Louis. And on the first day we were there, obviously everybody's a little bit trepidatious. I do my presentation, we meet David, we meet the team, they do their presentations. And everybody was so enthusiastic and there was so much energy and we just wanted to crack on with scheduling and customers and support and what we're doing.

• 24:17Speaker 02

  Me and Keith went back to the hotel that night and we stared at each other. We're like, we just basically said, this is on, this is on. You know, they, they want to sell to us, they want to buy, they want to buy us and we want to sell to them. And I think there is, it's an emotional feeling. That was in, when was that David? That was in um October, end of October.

• 24:36Speaker 01

  It was Halloween.

• 24:37Speaker 02

  Halloween. It was Halloween.

• 24:38Speaker 01

  Costumes the next day.

• 24:40Speaker 02

  It was Halloween. It was Keith's birthday. Yeah.

• 24:42Speaker 01

  Our UK friends with uh.

• 24:44Speaker 02

  That's right. David dressed up as a sheriff on the day.

• 24:49Speaker 02

  But it was Halloween and and so that was what really clicked, that emotional feeling of like, yeah, we can do this. This feels safe to do this. We like these people. We like this team. We like what we like the joint plan. We like the vision. And what I've said to the team, it's like as we're the space shuttle docking on the International Space Station. You know, the mission stays the same. We're still doing the same stuff, but we're basically joining a a much larger, bigger operation so we can keep going with it.

• 25:14Speaker 00

  Hmm. Now, put a put a cherry on top of this cake here. Share what you're comfortable sharing. My audience obviously loves numbers. Maybe I won't push you on a cash number, but David, can you at least maybe share a revenue multiple you guys ended up trading at and getting the deal done at?

• 25:28Speaker 01

  I would say we got to a number that was uh great for Bridget, great for us. We both feel good about it in both ways because you got to remember anytime we it was a mix of cash and equity, but anytime we.

• 25:40Speaker 00

  If you're not going to give me the top line like multiple because my audience, my audience will kill me if I don't get something from you. Can you at least show the percentages of how it was split? So for example, 10% cash, 30% equity, you know, whatever, whatever that and then they can't do the math because we don't know what the total multiple was anyway.

• 25:56Speaker 01

  Yeah, I mean, it's was it like a third?

• 25:59Speaker 00

  Bridget, are you comfortable with this?

• 26:00Speaker 02

  I don't mind. But these are David's numbers. If I know the number, David, if you want me to, I know the split. So it was 50 50, 50 cash, 50 equity. And that's what we were happy with. We were happy.

• 26:10Speaker 00

  And did you start there? Was that the initial offer or did you have to work to get to that?

• 26:14Speaker 02

  We we negotiated. There was quite a few different terms that we negotiated, but I want to say this is really important is that we were able to take a really generous amount of equity that we're really super happy with. A, because it feels like we're we're fully invested in the success of You Can Book Me Inside capacity, but also because we're bootstrapped. So for me and Keith as founders, we could take a um a hybrid offer much more easily than so many people who, as David says. Take on far too much complicated cap table nonsense at the very beginning and I highly recommend it because as founders, as bootstrap founders, we were able to do a deal that exactly, when we got our number Nathan, we got exactly what we wanted. We're really happy. But at the same time, we've actually now got this new relationship with Capacity and David, which

• 26:59Speaker 02

  makes it even better than what we were doing before.

• 27:02Speaker 01

  Yeah, the last thing I just kind of leave us with, because I know we're hitting time is Nathan, from our perspective, whenever we work with a company like you can book me,

• 27:10Speaker 01

  what if the company isn't convinced that Capacity's equity is going to be worth X plus Y in the future, then we're probably not the right fit. We want everybody incentivized to be able to say, hey, look, we want to build something together. And that means, yeah, you should get compensated for what you built and have a good outcome. But we really like aligning the incentives where we're building something together and the combination of these companies is much bigger and brighter than either one of them standalone.

• 27:42Speaker 00

  Yep. Well, guys, I want to be respectful of everybody's time. For the sake of my audience is to run down the story, we don't know what the total sort of top line multiple was, but let's say it was something very conservative, like 2X on 5 million, that'd be a 10 million deal price. And if it was 50% cash, that's 5 million cash to a bootstrapper, right? A bootstrapper team and Bridget, right? And then 50% equity, they can go for the ride after that. That's really what you want to build, right? Look how happy she is. She has full control. She had no board. She had to convince. It was her and Keith in Halloween costumes presenting in St. Louis, Missouri to get the deal done before or after a Paul McCartney concert. David, Bridget, thank you so much for the details. Thanks for taking us to the topic. Congratulations.

• 28:19Speaker 02

  Thanks very much, Nathan. Thank you.