How Marc Bell Turns Distressed Businesses Into Gold

Kison: I'm joined by Mark Bell, a self-described deal junkie whose career spans everything from [00:02:00] newspapers and watches to satellites and data centers. He's taken 17 companies public. Executed countless acquisitions and built businesses across the globe.

Kison: Mark brings a mix of grit, strategy, and creativity to M&A. He's not afraid to get his hands dirty in a turnaround. Today, we're gonna dive into what it really takes to fix broken companies, how to structure deals using leverage and seller financing, and the principles that guide leadership and success.

Kison: This episode is part two of our [00:02:30] conversation from last episode. If you missed part one, I recommend giving that a listen first. Otherwise, let's pick it up right where we left off. Due diligence. I think it's an important part, and just the examples you gave of investing across so many diversified industries.

Kison: I. How do you approach due diligence? Do you have this sort of adaptive framework for doing diligence on these different types of investments, or how do you do it? So when we do due diligence, we

Marc Bell: have a checklist. Basically, we start the top down. [00:03:00] We go with, start with the revenues, quality of earnings, make sure that cash coming in, ticket ties to the bank, statements to the tax returns.

Marc Bell: We look at the cost of goods sold. Are they buying things? Are they spending too much, or where we could save money? So we try to figure out that we may know ways or places that we could acquire things at a cost savings, 'cause at the end of the day, we want to add value. We don't wanna just buy a business, we wanna be able to buy it.

Marc Bell: And then day one, immediately add value to increase the bottom line without humming the business. We look at expenses. What are 00:03:30 they spending money on? Are they spending money smartly or foolishly? And you'd be surprised. Are they putting tons and tons of money into very expensive offices? Is everyone flying first class instead of coach?

Marc Bell: And expenses grow, and as the company grows, the fat grows along with it in terms of things that seem like a good idea. When you're a small business. Hey, let's bring in pizzas every day for lunch. And next thing you know is you have a caterer. And a kitchen, and all of a sudden it's costing you millions of dollars a year to bring to feed everybody.

Marc Bell: So you want to try to balance off where it makes sense to feed people on site, is the scenario we [00:04:00] go through all the time, 'cause we want people to always not leave the office. It's a time value of money, 'cause most people eat their lunch in 15 minutes, but if they go to lunch, it takes an hour plus, and that's lost time during the day, lost productivity.

Kison: So, almost like the first view is the overall business case. So like, why are we doing this deal? Does it financially make sense? Does the financial picture look good, and do the numbers back?Upp. Things are validatable.

Marc Bell: First,t we look t, do we want to be in that business? So there are lots of things we don't do.

Marc Bell: Lots of things we don't want to do. We either stick to things we know, or things we easily can 00:04:30 understand. And we also wanna invest in businesses that we like. Do we like what we're doing? Do we like this? will itWillfun to do? Or can what we can do for the business be fun? How do we change how they do things and do it in a way that's much more effective?

Marc Bell: With all the tariffs going on right now, we're seeing all these overseas companies trying to come to the U,S and because there's such cheap labor in a lot of China and other countries, they don't take advantage of automation. They don't take advantage of things 'cause labor is so cheap. But in the US, we don't take advantage of a lot of automation either.

Marc Bell: So there's an 00:05:00 immense opportunity to onshore. All these products and goods from overseas may go back to being made in the USA. You remember that from years ago?

Kison: Yeah.

Marc Bell: Bring made in USA back made in America. And people say, well, you know, the cost of labor here is too expensive. But when you're doing assembly lines with robotics, you don't have that much labor.

Marc Bell: Your CapEx is very high, but your cost per year is. But then the robots work 24/7, 365. They don't need health insurance. They don't need unions. They don't unionize. We hope it's a

Kison: huge opportunity. That's a good point. So the industry that you wanna be in, [00:05:30] then you can build an actual business case. Make sure this is an area that either you know or you can learn quickly.

Kison: And then the efficiency part was interesting because it's like, how do they operate their business? Where are these opportunities for us to be more efficient about running the business? I. Anything like you've learned in terms of really digging in to make sure there's no gotcha surprises, 'cause even some of these deals that you mentioned, buying things outta bankruptcy, I feel would be so hard to do diligence on.

Kison: What have you learned to like really dig int,o to sort of avoid the big surprises

Marc Bell: With every business? That's gonna be surprises with every business [00:06:00] that's going to be draft and theft. Fortunately, it's very unfortunate you don't read about it every day, but it happens every day. But we're always gonna find something that, oops, we missed something, but we try to be thorough so we don't miss anything as we get older, our checklist.

Marc Bell: Went, from a very small checklist to a very large checklist. So it was one page is now hundreds of pages as we go through all the different check boxes we have to do to make sure that we don't miss anything.

Kison: Hey Mark, the big thing when I talk to people, the we, you look at diligence, you look at the factors that drive success, it's always culture comes up big time, and I [00:06:30] feel like there's such a wide view on the impact of culture.

Kison: Some are like, you know what, once you buy the company, you are gonna make the culture what it is or what you want it to be. Others are like, Hey, I'll walk away from the deal. If the culture doesn't line up, what's your sense on it? We have a few different premises.

Marc Bell: Family. First, we never want to see an employee miss their child's school play, miss a birthday, miss a baptism, o  any kid event; they have to be there for their family first.

Marc Bell: We don't want to go home, go to their performance, or come back. Do they have to do it, but we don't want people [00:07:00] missing out on their family. That's number one. Different age groups we've noticed have different needs, and we want to try to appeal to those needs. So we had a company, it was a technology company, and we were hiring peo,ple and we had an older workforce that we were building.

Marc Bell: We decided, you know what, you are 60 or 70 years old. We still give you a job, 'cause you know, we see a lot of people discriminating against age. We've thought the exact opposite. They have all these decades of knowledge on what we were building. And it was very interesting because what happenedd was that we learned.

Marc Bell: They would come in on the weekends and we were [00:07:30] trying to figure out why as a group out 700 employees, we had 130 who were a RP members, and when we saw a lot of 'em on the weekends, it turned out most of 'em were single, mostly men, mostly single, and they had no place else to go. What we did is on the weekends, we made sure that they had environments where they could all be.

Marc Bell: Sit together and have lunch. And they weren't getting paid overtime. They were just, they were doing it 'cause they had no, they wanted to be around people. That became their social life. So we encouraged it, and we did things for them that made it easier for them. We got 'em bigger monitors to make sure they could see [00:08:00] everything.

Marc Bell: We got them all the ergonomic tools for their desks. Different chairs to some people. We made sure we had a D, bathrooms everywhere, even if beyond what the code required, to make sure that we were definitely meeting their needs. Then they started bringing their friends. It was amazing. They were very loyal.

Marc Bell: They never quit. It was just an amazing thing. We also look at different religions. We built in our offices in California, we put a prayer room in for people who are Muslims. So for the five calls to praye,r they could do, and we had a big prayer room, and we had a place where they could wash their feet, hands, and feet to keep their shoes outside.

Marc Bell: And we thought it was important [00:08:30] to make everybody comfortable regardless of who they are.

Kison: That's so interesting. That's like a really different lens than just going beyond understanding the culture. It's like you're, you're sort of catering and finding ways to create a better people experience.

Marc Bell: Create a better people experience. We want people to feel comfortable regardless of their religion, regardless of their race, 'cause of what they do. Zero tolerance policy for any discrimination in the company. You don't even get a warning. It's the grounds for instant termination if you

Kison: are violating our rules.

Kison: I like that. So we're doing diligence, understanding the cultural piece, and that sort 00:09:00] of lends to what are you gonna do with the business afterwards? Find ways that you can improve operational efficiency, but also the people's experience. I got a big topic I wanna run by you. This is one I really wanna take apart.

Kison: If anybody's listening, gotten this far, this is where you're gonna earn your listening dollars over here. Capital allocation. It's something I didn't think very much about. When you're running a really small business or just an early-stage tech company, now we are growing, we're about 50 people, right? At 10 million a RR.

Kison: We're looking at options because 00:09:30] M&A opportunities is popping up, and some are profitable, and you're like, well, I can do this deal with private credit. Some are not profitable. And it's like, well, I probably need an equity partner to do this deal. And then you're looking at your own business.

Kison: You're like, we grew 44% last year. We're strong and pretty optimistic that we're gonna grow as much, if not better, this next year. Checking off trade-offs there, it's like, well, if I raise equity, maybe I should just wait. Keep doing the organic growth. Then do some of these things later on. So it's getting trying to get me to wrap my head, understand capital [00:10:00] allocation and I feel like there's context of a private sense, and then as you mature, it changes.

Kison: 'cause you obviously got more products out there and then you got the whole public market. Teach me capital allocation.

Marc Bell: Capital allocation. It's hard. You're making decisions that affect your future debt versus equity. I'm going through this now with a friend of mine. He's got a great, amazing company. He's growing very fast.

Marc Bell: He was thinking of selling a third of his business to raise some capital. Yep. And I was like, why? You know, instead of selling a 30 business, why don't you just put on some debt? And where you get the same amount of [00:10:30] money, but in the case, it could be you give on your upside of your equity. And I said, if you're really confident, you're gonna keep growing.

Marc Bell: And he is. I'm like, so put the debt on the company. That's okay. You can pay the debt. And then in three years, when you wanna sell the business, you'll own a hundred percent of the equity versus only 70% of the equity. If you sell off equity today, that'll be worth much more tomorrow. But you guys have confidence.

Marc Bell: I But raising debt, it was a double-edged sword. If things go bad, all of a sudden your creditors are gonna take your company. You have to pick your creditors, you have to build relationships with your creditors, which is very important. They have a lot of power over [00:11:00] your future, and some days will be good days, some days will be bad days.

Marc Bell: You want a partner who's really gonna work with you. The debt is cheaper. Capital in a sense.

Kison: Well, the debt is cheaper capital. If you have confidence, you're gonna keep growing. Okay, so this is like the venture model, right? If it's like a high risk thing, nobody really knows the outcome or probability or uncertainty, basically, then the equity's probably better bet.

Kison: I had my

Marc Bell: first venture business called Globe Ventures. I would always go to people in a half joking way. I would ask them if they would personally guarantee the money I [00:11:30] put in and let me put a lien on their house and their other condo and their car and their kids, and I just wanna see the reaction then.

Marc Bell: And they'll be like, well, you know, well, I wouldn't let you put a lien on my house, but why not? You're asking me to lend you money. If you have so much confidence, why wouldn't you want that? Why won't you personally guarantee it if you're so confident that I should put up my money? Why aren't you confident?

Marc Bell: And you see their reactions. And then sometimes people say, absolutely, I'll totally do it. And we never made people do it, but we wanted to see the reaction of how they would answer the question [00:12:00] to gimme an idea of what's going on in their head. So you look for that confidence. I believe if you truly believe in what you're doing, you will be successful.

Marc Bell: You have to be a true believer. People sense that when people see that you have the passion and you believe in it. I used to teach grad school at AT FIU in Florida, and I would tell my students they should follow their dreams. Don't do something to make money. Do something because you love it and the money will follow.

Marc Bell: And most of the time it does.

Kison: I agree. You gotta have that interest that keeps you in the game long term and keeps you [00:12:30] motivated.

Marc Bell: Yeah. You have to really love what you do. You have to want to be at work every day. Like when I started in my first company, I lived in the office. If there are 120 hours a week, every week, I loved what I did.

Marc Bell: And if I don't love it, I then I shouldn't do it. But if I love it, it's successful.

Kison: When I look at doing a minority recap for our business, one of the things I'm interested in is finding the right private equity partner that could potentially bring us two things. One is the ability to mature M&A muscle faster, help us the [00:13:00] strategy, getting more sophisticated with the strategy build pipeline, help us execute.

Kison: Second is our product fits into the private equity ecosystem. We sell it to about 200 corp dev teams. Right now we have a handful of private equity and you accelerate or go to market and private equity 'cause that's a whole learning curve I don't wanna do all over again. That's like the incentives that we are beyond capital.

Kison: Do you start looking at some of those factors and saying, okay, maybe there are some reasons or is it just let's keep being, you know, I, I still got high confidence. I don't need [00:13:30] them for a while. Like I still continue that 40 plus percent growth rate than they made the debts cheaper with private equity.

Marc Bell: Some private equity firms are amazing and they're great partners and they will really help you. Some are loan to own shops, they're gonna invest in the idea of finding a way to squeeze you out of the rest. When you're looking at private equity firms, you should talk to the CEOs or the owners of other deals that they've done and see what their experience was with that firm.

Marc Bell: And that's the first thing I tell people. Just like interviewing a candidate, you're gonna hire, you're interviewing a private equity firm, [00:14:00] you want to know about them, and you wanna know what, not only their track record, but you want to know from the who, the people who they did business with, what they thought of them.

Marc Bell: The firm may have made money or they may have screwed the founder and the CEO of the company, the CEO of the company.

Kison: That's a good point. That's one I'm working on now. I'm just doing a backdoor. I just go to the port codes that are adjacent industries, reach out to their CO and say, Hey, talking to so and so.

Kison: Would you mind giving me a little bit about your experience with 'em? Yeah, that's great. And then that probably helps you get that it's almost like your own personal justification of is there gonna be [00:14:30] more accretive value beyond the capital with this partner as opposed to otherwise I'll just go get that.

Marc Bell: Yeah.

Kison: KKR had a great

Marc Bell: model decades ago where they had a whole team that would help come into your business and help find ways for you to save money like a consulting firm. Some firms still do it today. They want, they literally will come in with a team and they'll help you figure it out. They'll help find ways for you to cut costs.

Marc Bell: They have bulk deals, whether it's with FedEx or whether it's for mobile services, what have you, that they got a be that they can get you cheaper rates, but it all adds up. Penny turn. Turn into dollars.

Kison: You got the general [00:15:00] evaluation of equity versus debt. Big factor is your confidence in your future. So that's gonna be one piece of it.

Kison: And then that, there's obviously a lot of different products. It depends where your business sits or you have asset light, and then I guess your size, because I've noticed that we're bootstrap still, and you don't get as many options if you're private equity backed. So you gotta play with certain private credit firms.

Kison: You're paying really high interest when you're in that situation. I'm curious about when is your business matures and you start thinking about these other levers that come into play? You [00:15:30] mentioned bonds earlier going public, you've taken a number of companies public. What's the rationale for doing that?

Kison: Because now you're seeing all this private capital available. You could, we've seen Stripe and these other companies just stay private forever. Today, I believe if you take

Marc Bell: a company public, you have some sort of Mele deficiency. 30 years ago, it was a lot of fun. Now it is just you stay private. If you're vetting brains, you stay private.

Marc Bell: I'll never do another public company again. It is just, I'll keep everything private. I'll sell to private equity firms. I'll sell [00:16:00] to somebody, but I will not go public. It's just not worth that. It's the same reason why lot of smart people won't wanna run for congress, run for office, just not worth headache.

Kison: Okay, so let's say the headache in public. Now I'm start out this, it's a public scrutiny. It's everything you do. Public scrutiny, investor relations, everything. Everything you do is

Marc Bell: wrong. You can grow the companies through the roof. And it's still wrong. And because you didn't do it, that because you're, you're, you're growing a hundred percent a year and if you grow 99% one year, oh my God, you're a failure with social media.

Marc Bell: You got all these people, [00:16:30] short sellers are out there, all over social media just bashing on you. And I'm like, it's just not worth it. This is not worth the headache. X is not your friend. And uh, like anybody could be an activist. Now they can be. It is mindboggling how many people out there and there're probably 14-year-old kids sitting there doing this and or people in China doing this.

Marc Bell: It's just mass rooms. It's just people who are just bashing and it's, I don't need this. And I stopped looking at social media. I was like, you know what? It's just not as much fun as it used to

Kison: be. Okay. I'll rule out going public, I'll maybe it'll be like I could [00:17:00] exit to a public company and call it a day there.

Kison: There you go. There you go. Take a stock. I can take a stockholder roll, take a stock and run. Hold a roll for a title for a year or two and then call it quits. Exactly. Six months be done.

Marc Bell: What?

Kison: What are other levers? Yeah, I mean there's obviously private equity runs the gamut. You got vc, you got different private equity from majority of minority O owners.

Kison: You got just. Individuals. You have sovereign wealth funds and large institutional side.

Marc Bell: Yeah, they are become massive. And your family offices now have become massive. So much wealth has been created in the [00:17:30] past 20 years. It's phenomenal. I think about it to give 'em the Forbes 425 years ago, you needed $750 million of net worth.

Marc Bell: Today it's, I don't even know how many billions it is to make the forest 400. The number, the wealth that's been created in this country is just, and all over the world is just phenomenal. These family home offices, they buy businesses and they invest and they split their money to work. Family losses have become a juggernaut in the investing world.

Marc Bell: They just didn't exist 25 years ago.

Kison: We have this capital structure, there's all this different equity options and then debt [00:18:00] as well. Private credits opened up a bunch of different options and products as well. Is the math like something I wanna understand? Again, go back to capital allocation broadly.

Kison: How do you do the math in your head? Because I know you're got a strong investor lens. Is it, Hey, I'm looking at five years out. I want to be at this target, IRR and you are working backwards. For me, I'm still that bootstrap mentality. I'm just gonna work my ass off day in, day out. At the end of the year, I'll sit with the tax accountant and look at the numbers and he'll tell me how I did.

Kison: Kind of curious from your sense, if you've got a different view of how you think about capital [00:18:30] allocation from what you're targeting. Returns working backwards or is there just a different way that you look at it? We look

Marc Bell: at capital allocation. Where do we get the biggest bang for the buck? Risk adjusted.

Marc Bell: So what's the risk? If it's a sure thing, and sure they can be defined a million different ways. We do it. Like right now, I'm, I've been buying up for the past year, lots of bonds in banks and I'm paying, getting paid seven, 8% coupons right now. So it was a good portfolio move and it's turned out to be a great portfolio move in this market right now.

Marc Bell: And equity gotten pretty, you know, right now, you know, holding pretty flat markets down a lot and I'm pretty flat. [00:19:00] We made some good equity choices. We invest in private companies. It's all about risk reward. What's the odds are gonna succeeding? What are the odds are gonna be a winner? And you're betting on the, not just jockeying the horse, you're betting the industry.

Marc Bell: Is industry gonna be a gold mine? Like, we spent a lot of time lately looking at small modular reactors. We spend a lot of brain cycles trying to figure out now how we can mass produce 'em. How can we do it cheaper? How we ways can we do it? At the end of the day, we can't figure out a way to get it below 4 cents a kilowatt.

Marc Bell: It just doesn't, math doesn't work. [00:19:30] And the, the matter how hard we tried on paper, no matter how much we wanted to be able to do it, we couldn't figure out a scenario that it's cheaper than other, cheaper than natural gas. So then you profile as a high risk, like you just, there's we profiled as a super high risk, then your expectation is like a much higher return.

Marc Bell: And uh, we had this vision that we could make a lot of money. Doing it because there are all these data centers being built and they need power and there's not enough power in the us but at the end of the day, it's not gonna come from small modular reactors. We just, it doesn't work. The math doesn't work.

Marc Bell: And that was, and [00:20:00] we were all very disappointed 'cause we spent months on this project and we just couldn't figure it out.

Kison: Looking at your investment thesis in a certain timeframe, or does it just completely vary? It varies from day to day.

Marc Bell: Right now real estate has me all excited. I'm watching the real estate markets around the country start to soften.

Marc Bell: Our San Francisco just collapses all in. You're buying. People are buying things with 20 cents on the dollar and office buildings in San Francisco. I stand in Chicago too. I look out my window in my hotel here. I see vacant floors all over the place and all these office buildings. I know what the Vegas rate in New York [00:20:30] City is, but it's dropping like a rocket.

Marc Bell: There's so much empty space everywhere. Retail around New York City. There's tons of empty stores I'm seeing in Miami where I live. Prices are coming down. People again. And what's gonna happen is you're seeing the inventory of things for sale in Miami skyrocket. You're seeing the number of sales drop dramatically.

Marc Bell: Interest rates have gone up dramatically. No one's buying. And that's gonna start putting huge pressure on people who have to sell to really start lowering their prices. And we're seeing some great opportunities all around Miami now to buy real [00:21:00] estate. And because people realize that a year from now is gonna be a lot cheaper.

Kison: That varies on that strategy of what your whole period's gonna look like and what the outlook is and your risk. Some asset

Marc Bell: classes like real estate, I view them as long-term holds, but you always wanna buy the worst building on the block 'cause you can make it the best. You never wanna buy the best building on the block.

Marc Bell: Whatcha gonna do with it?

Kison: Yeah. The opportunity to add value. What do you do when things go sideways? You've seen this before. You've seen it in the.com bubble boom. You've just had investments. You gave the watch example. Teach me how to handle [00:21:30] it because I want to get a sense that I can be as optimistic about our business, but I feel like when things go sideways, you tend to be blindsided by it.

Kison: I don't know. Can you coach me on how to mentally be ready to do that? First, always make sure you're working

Marc Bell: on the first floor of the building. You can't jump. Second, I keep Xanax far away from you because you're just gonna want to keep taking some. Okay. Third is to make sure you have a good closet to hide in, good dust to crawl under.

Marc Bell: I'm just joking. Obviously we've not the first floor thing, but it's hard. You have to own what's wrong. First, you have to realize the [00:22:00] buck stops with you. If you're in the CEO, the buck stops with you. You have nobody to blame but yourself. And once you own that, then you figure out how. Then you work the problem and you have to work it.

Marc Bell: And it's easier said than done. And the whole idea is you get the smartest people you can into a room. How did the problem happen? How did we fix the problem and how do we prevent it from happening again? And we've seen lots of mistakes being made by people regardless of who made the mistake. At the end of the day, the buck stops with me and I have to own it.

Marc Bell: I have to work it, and I have to fix it. And I just have to push through. And as my old [00:22:30] partner used to, you brute force it. You just figure it out and you don't go, you don't. You go home until you figure it out because all problems can be solved. It just requires sometimes some creative thinking and sometimes it just requires some fresh air.

Marc Bell: And you go for a walk and you tune out the world and you think they come up with a solution. You have to own it. And because people always wanna blame everybody else. No, and I always tell people who work for me, if you make a mistake, own it, like I said earlier, so can't make mistakes. They don't care if an employee makes a mistake, they care that they own it.

Marc Bell: They come to me right away. They say, yep, I messed something up. [00:23:00] I said, that's fine. How are you gonna fix it? And I, I wanted to teach them how to solve the problems. Because I know at the end of the day it does the buck desktop with me though.

Kison: So for you, it's a big part about ownership. There is no philosophy on how paranoid you should be about what's around the corner.

Kison: You should be paranoid because everyone's out to get

Marc Bell: you. Just read X. That's true. That's the downside of public companies because everyone's out to get you. Everyone is. You know you. Despite how much money you've made people over the years, they only care about what you're making them Today. Everyone's about what you've done for me today.

Marc Bell: Forget about yesterday. That's why staying in private is a great idea. [00:23:30] You have to figure it out and you own it. Easy part is to get up there, get on stage. So you know what? I made a mistake. This is the mistake I made and this is how we're solving the problem and we're gonna solve the problem together.

Marc Bell: Nobody wants to take ownership because you don't take ownership, then no one can. It could be nobody's fault because they just point fingers at each other

Kison: and because it was a group decision. Uh, so it takes so long to get anything done and exactly had to fix the problem as well. You were in hospitality before?

Marc Bell: Yeah, so it was very funny. We started investing in restaurants and nightclubs. We in New York City in [00:24:00] restaurants like Lavo Pizza Catch. We invested INGOs in Miami, Philipp Chow. We invested Inza tequila bar. We invested in gosh wide range of venue,s and it was all about, at the end of the day we had a piano bash, munch bar.

Marc Bell: It was always solving a problem and the problem was, is I hated waiting for a table. That's how it started. You want to eat and it's a busy Saturday night, you can't get a table a lot of places. So I decided I wanted, I wanted, if I was an Italian restaurant, [00:24:30] an Asian restaurant. A fish place. All the major food groups I would eat.

Marc Bell: The only thing I never did was a steakhouse. That was the only thing I never did. And then I loved to go out. I love music, so I love nightclubs. So we invest, started investing in nightclubs. It was a passion play, but I had amazing partners, uh, across the board, and I was very profitable. I made money and I solved a problem.

Marc Bell: I could always get a reservation,

Kison: so it worked. I'm gonna start using that. I'm gonna drop your name and see if I can start getting in some of those places and it doesn't work anymore. And we sold them all, unfortunately. Sold them all. Sold them all. Unfortunately, it's all right. It sounds like a familiar name.

Kison: Mark [00:25:00] still use it. I know

Marc Bell: Mark Bell. People do it still to this day. People call me up. Do you know? Like seriously.

Kison: That's so funny. Looking back, which deal taught you the hardest lesson? How did that experience reshape how you evaluate your structured deals today? I.

Marc Bell: I got a

Kison: lot of those.

Marc Bell: It's picking your partners is probably the biggest lesson I learned.

Marc Bell: I've had some amazing, spectacular partners. I've had some amazing, spectacular lenders. Amazing, spectacular equity investors, and I've had the exact opposite. [00:25:30] I've had the world's worst lenders, the world's worst partners. I've had partners who've stolen, I've had lenders who broke every rule in the book.

Marc Bell: Some people are amazing. Some people can be real pricks. They don't at the end of the day. That's why I said make sure you talk to people to see you're getting in bed with. That's the one mistake I didn't do is talk to people to who I was getting in bed with.

Kison: That's really true. I feel like I learned that a lot, especially from doing this podcast.

Kison: When you interview somebody, you get a really good sense of the character, who they are. You get a sense of that network effect too. You start [00:26:00] seeing that it's like a bad character there. Usually all the associations they tend to be in the similar vein. That makes sense for you to go back, do the references, like we used the example with the PE firm.

Kison: Yep. Talk to those other owners, get a sense of, it's by, by far my biggest mistake. Okay, number one. So that's number one thing I'm gonna take away from this interview is I'm going deep into those reference checks. You need to know

Marc Bell: Who are your partners are gonna be.

Marc Bell: It's just like relationships. You need to know, you wanna know wife, you don't get married right away.

Marc Bell: You want to make sure that person's the right person for you. Yeah. 'cause it's a relationship and And you want it to work. That's great advice. [00:26:30] What's the craziest thing you've seen in M&A Craziest thing? M&a. Yeah. I've seen a crazy in & Crazy story. Which isn't M&A, but it goes to the crazy things of bad investing.

Marc Bell: A friend of mine was buying a house in New York. They inspected the house the day before closing. They closed. They went after the closing back to the house. The house was gone. The house burned down the night before. So the guy who owned the house got his money from selling the house, and he got the [00:27:00] insurance money for the house being burnt down.

Marc Bell: And my friend buying the house was left to.

Kison: What

Marc Bell: craziness, and they never could prove arson, never could prove anything. And the guy got paid double and my friend was left with a piece of dirt with a rubble, craziest thing, asked for crazy. I can't make this shit up. Because it burnt down before. Yeah.

Marc Bell: You're supposed to inspect a house an hour before closing. Not the day before closing. That's the lesson learned.

Kison: Yeah. You do it [00:27:30] right then. Yeah. Yeah. Because they, okay, we wait. The inspections done, uh, contingencies. And now every time we buy

Marc Bell: Something, we have somebody on site during the closing. We do, because that's why we, we saw, remember this, I remember what happened.

Marc Bell: You know what my friend went through. So we have, we have a person who sits there. During the closing to make sure nothing happens to the building.

Kison: Yeah. So their house burnt down. They closed the next day because they didn't look at the house. The guy got paid his insurance money on the house burning down.

Kison: He technically had ownership. They got wired all the money for

Kison: I appreciate you taking the time, helping me become a better MA scientist here. Listen, thank you so much for having me today. It's

Marc Bell: really been a blast. I really appreciate it.

Kison: Fellow MA scientist, you've gotten this far. You're a true MA scientist. Love to hear from you. I know we switched things up with this interview.

Kison: Got the Mark AV investor to teach me a few things and learn from his [00:28:30] experience. Reach out to me on LinkedIn. Love to hear feedback on this interview. You have other topic ideas, things I should be covering. If you just wanted to rip on me and criticize me and how I can do better at this. I'm open. I'll take it.