00:33:09 · Kenn Ricci
[00:33:09] S1: things, number one is an airplane doesn't like to sit around. They break when they don't fly, fluids leak out and they, so they want to fly, number one. Number two, they have the capacity to fly a thousand to twelve hundred 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 vision. And so he initially thought, well, if I get four people to each put two hundred hours on the plane, that's kind of the perfect. So I'm going to 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 two hundred hours. Now today you can buy one hundred hours seventy five. But that was his vision. And he sold these white tails, these consignment aircraft. So he never put up any capital. He said, If I sell them, 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? 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, that was attractive to a lot of different companies. And so he was starting the steel 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. 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 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 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.
00:35:27 · Kenn Ricci, David Senra
So in 1996, 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. And I go out to different banks, probably 35 or 40 of them with this idea of fund me the amount of money I need to start the business. I think I needed 30 or $40,000,000 of borrow. Wanted to borrow it. And they look at me and the banks are 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? None of them were a buyer. I think at the end of twelve months or fifteen months of being on the road, I had maybe 7,000,000 of opportunities if I put up assets equivalent to 7,000,000. It was the worst financing ever. In June 1998, Warren Buffett buys NetJets for $750,000,000 and he christens the industry. And I just happened to be the guy who saw the banks last. And that summer I got almost $300,000,000 of debt financing. So again, accidentally wealthy. [00:36:31] S0: Because they're like, well, is doing [00:36:33] S1: what It's he's [00:36:34] S0: a good idea if It's Warren is [00:36:35] S1: good idea. Yep. And all of a sudden Bombardier Capital, Boeing Capital Fleet Bank, all 50,000,000 here, 50,000,000 there, gave me these lines of credit. That had allowed me to buy the initial fleet, which I went active 10/13/1998. [00:36:50] S0: But what is the company? Is it still Corporate Wings? [00:36:52] S1: No, I phoned a company. I branded that product Flight Options.
00:36:52 · Kenn Ricci, David Senra
[00:36:52] S1: No, I phoned a company. I branded that product Flight Options. [00:36:56] S0: Okay. [00:36:56] S1: That was the brand. Deal is how [00:36:59] S0: the best founders turn the world into their talent pool. I've been studying how history's greatest founders operate for a decade. And one thing they all have in common is they understand that recruiting and hiring the very best talent is your most important priority. A players recognize other a players, which is why top companies like Ramp, Shopify, Eleven Labs, Uber, and DoorDash all use Deal. Many of the top founders I know have personally invested in Deal after using their product. And what they discovered is that Deal is the best company in the world at building infrastructure for global hiring. Deal will help your business hire, pay, and manage any worker anywhere in the world so you can retain the best talent anywhere and spend the rest of your time focusing on what you do best, delivering value to your customers. The founder of Eleven Labs has a great description of the value Deal can give your company. He said, we built Eleven 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/senra. That is deal.com/senra. So that's flight options. You start with how many planes with flight options? Two.
00:36:59 · David Senra, Kenn Ricci
[00:36:59] S0: the best founders turn the world into their talent pool. I've been studying how history's greatest founders operate for a decade. And one thing they all have in common is they understand that recruiting and hiring the very best talent is your most important priority. A players recognize other a players, which is why top companies like Ramp, Shopify, Eleven Labs, Uber, and DoorDash all use Deal. Many of the top founders I know have personally invested in Deal after using their product. And what they discovered is that Deal is the best company in the world at building infrastructure for global hiring. Deal will help your business hire, pay, and manage any worker anywhere in the world so you can retain the best talent anywhere and spend the rest of your time focusing on what you do best, delivering value to your customers. The founder of Eleven Labs has a great description of the value Deal can give your company. He said, we built Eleven 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/senra. That is deal.com/senra. So that's flight options. You start with how many planes with flight options? Two. [00:38:14] S1: Once I get the financing, probably 25. [00:38:17] S0: Okay. Why'd you pick
00:38:17 · David Senra, Kenn Ricci
[00:38:17] S0: Okay. Why'd you pick [00:38:17] S1: a number like that? There were three different fleets. Okay. Two light jets and medium jet. And you need about eight aircraft to be your core fleet. In other words, if you and me are both going to buy a share of an aircraft, we recognize there can only be one. Because if you and I want to fly the same day, who gets the plane? So you had to show the potential prospect that you had a fleet. And eight was about the number that people, oh, have eight citations, I'll buy one. And then you have, you can service us. So if you [00:38:47] S0: had 25 planes to start out, how many customers, like what, when do you hit your limit? Like a 100 people's too much? Like what's the... No, because remember these are core fleet. [00:38:56] S1: These planes never get sold. What I do from this point on is if four people buy the citation, I buy another citation. So these 24 aircraft were off. So you [00:39:06] S0: don't stay with 24, 25 for very [00:39:07] S1: And you know what, that kind of, that's still a model we use today. If we look at our fleet of three sixty five 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 customer's ownership and a share of [00:39:20] S0: a jet. Okay. [00:39:21] S1: 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. Okay. So, but [00:39:29] S0: this is called Flight Options. Yes.
00:39:29 · David Senra, Kenn Ricci
[00:39:29] S0: this is called Flight Options. Yes. [00:39:31] S1: How do we get from Flight Options to Flexjet? Okay. So it's a little longer than you probably hope, but a $100,000,000 in sales between October and December. [00:39:41] S0: 400. Four, wait, first three months of?