Nikonomics - The Economics of Small Business
00:34:43 · Peter Lohmann, Nikolas Hulewsky
[00:34:43] S0: It's an operational nightmare like I talked about, but the business sort of fundamentals are strong, which is that it's a sticky, contractually recurring revenue. Most of these folks are on one year agreements minimum. And then there's also really great cash flow dynamics. There's very few expenses that you have to outlay, capital expenses, and you also collect your fee right from the rent. So there's there's literally no AR. We don't have an AR function in the business because we just get paid right from the rents. And if you set it up right, you can actually you can actually have, like, a negative cash conversion cycle. So there's a lot of things that make it attractive. But, basically, these big groups that are funded by private equity and VC money, they see that you have 300 doors, you know, in, you know, some city, And they're just like, yeah. We wanna get into that city. We wanna expand, and and they just they just pay up for it because they they want all those contracts. It's like selling a book of business for for most of these guys. [00:35:37] S1: That's freaking awesome. Alright. Well, I was gonna ask you what opportunities you're seeing outside of property management, but that's too good. I don't wanna distract anybody outside of property management. [00:35:45] S0: I don't wanna make it sound easy, though. I hope that came through. It's not easy, but you can do it.
00:35:45 · Peter Lohmann, Nikolas Hulewsky
[00:35:45] S0: I don't wanna make it sound easy, though. I hope that came through. It's not easy, but you can do it. [00:35:49] S1: I know it's not. This is my opinion. Pick your hard. Everything's hard. Yeah. Anything that looks like it's easy from the outside is difficult. Like, you get into it. I think we were talking about this, right? Like, you think it's easy, you get into it, you quickly realize it's not that easy, and that there's a reason why many people aren't doing what, you know, what you're trying to do. It's just a function of whether or not you have the ability to actually stick through it. So, yeah, I'm a big believer just in in pick your heart. So this was awesome, [00:36:19] S0: man. [00:36:19] S1: I appreciate you.