· David Senra, Alexander Taubman
[00:00:00] S0: Passionate about capital allocation. [00:00:00] S1: Yeah. [00:00:00] S0: And then now you met the right people where you could actually build a unique partnership that very few people can match. [00:00:00] S1: Yeah, exactly. I got very lucky. Super grateful to have incredible early investors. I think they've really pushed our thinking and level of ambition. And obviously our mutual friend Rick, who's an extraordinary investor and been one of our biggest partners, and Hemant at General Catalyst and Mark, and it's an amazing group of people, Elad Gil, and they basically really pushed my thinking in a big way since the beginning. [00:00:00] S0: What Rick tells me about you is that you're unusually receptive to both new ideas and criticism. And a lot of founders obviously are more like kind of headstrong and less... Usually they'll listen, but they're running the ship, you know? [00:00:00] S1: Well, that's nice of him to say. I think feedback's a gift. We want to get better every day, just like we want our companies to get better every day, we want our team to get better every day. I want to get better every day, and I have a tremendous amount to learn. That's why I love your podcast, actually. I learn more from you probably than from almost anyone from your episodes. And that's why I make everybody... I actually do. It's a true thing. [00:00:00] S0: I know this is- [00:00:00] S1: Longlake onboarding includes like half a dozen of your episodes.
· Alexander Taubman, David Senra
[00:00:00] S1: Longlake onboarding includes like half a dozen of your episodes. [00:00:00] S0: That's just smart. Okay, so I know you were working on a few deals. You and Zach were working on a few deals together before you found Longlake. [00:00:00] S1: Mm-hmm. [00:00:00] S0: You guys are talking about this thesis for what, six months, a year? Like, how long does it actually take to... And then we got to talk about the fucking crazy growth that you've had in the last three years. [00:00:00] S1: Yeah. So yeah, Zach and I, we go way back. We started at Goldman, as I mentioned, and we'd stayed friends a long time. And he's done some amazing things in technology, brought me into some of those things. [00:00:00] S0: That's an understatement. [00:00:00] S1: And then he was very inspiring on that. And then he was coming into some of our Taubman Capital deals and buying. We did a funny thing where we ended up like, we built one of the largest go-kart track companies in America. We partnered with 20 different locally owned go-kart tracks and created a platform. And so Zach invested in that deal with us. And we realized there's some really great businesses out there that people don't spend a lot of time thinking about. And what if we could bring the world-class technology expertise of some of the companies like Ramp and Cognition and the labs, and you could bring some of that type of world-class AI team to the Main Street American businesses and enterprises? And that was the idea. [00:00:00] S0: Was it that idea from the very beginning?
· David Senra, Alexander Taubman
[00:00:00] S0: Was it that idea from the very beginning? [00:00:00] S1: It was that idea from the very beginning. [00:00:00] S0: So from that, the conversation you guys start having about this to, "Shit, we're going to start the company," to it's founded is, what's the timeframe there? [00:00:00] S1: I think it was like nine months from the first conversation until we actually incorporated the company. I was still at Oaktree at the time, so we were spending a lot of time thinking about it, meeting some of the early engineers who ended up joining us. And I think the thing that got me really excited was when I started to talk about this idea with engineers, there was a lot of palpable excitement. People were really excited to work on the project. I knew we could build an extraordinary team. Being able to build the right team at the right time to go and do this was a unique opportunity. I was very bullish on the company and very excited, but I think we just continue to get more and more excited about what's ahead. Our bar for what we want to build and what we want to do keeps going up every day. [00:00:00] S0: Dude, I've been there from like, I think day one. But this is like, when I heard about the Amex deal, I'm like, "Why am I not thinking?" Like, I know these are my friends. I'm not even thinking, like I didn't even think it was a possibility that you would do a $6 billion acquisition. I was like, "Damn, these guys are really good."
· David Senra, Alexander Taubman
[00:00:00] S0: Dude, I've been there from like, I think day one. But this is like, when I heard about the Amex deal, I'm like, "Why am I not thinking?" Like, I know these are my friends. I'm not even thinking, like I didn't even think it was a possibility that you would do a $6 billion acquisition. I was like, "Damn, these guys are really good." [00:00:00] S1: Our vision is really big. I mean, it sounded kind of crazy when we were a couple of years ago when we were saying we wanted to play at- [00:00:00] S0: But it's not just your vision. The way you guys are executing is even better now. [00:00:00] S1: I think that's true, yeah. [00:00:00] S0: Like, you're getting better. You guys are getting... You were already super impressive, but you are literally getting better. [00:00:00] S1: Yeah, I do think we're getting much better. This is partly why I value feedback from some of our smart friends and some of our investors is we want to get better every day. And I do think it's true. [00:00:00] S0: Oh, can we talk about the story? You guys were thinking about a few acquisitions, and we don't have to talk about the prices or whatever. It was just like, "Well, we could do this one over here, or we could do this one, or we could do this one." And you told me the story, and Rick's like, "Why not do them all?"
· Alexander Taubman
[00:00:00] S1: Exactly. Sometimes we like to say, I think the greatest gift that you can have in a partner is someone who makes you more ambitious. And I think our partners today really make us more ambitious. And when we started the company, we talked a lot about how if we do this right, we can really help change a lot of industries and change the economy, and it sounded kind of lofty. But now that we're operating in 15% of the services TAM and with tens of thousands of team members, it's starting to feel like it's coming alive. And so I think that's really exciting, which means we're able to... I remember in the beginning, convincing some of our earliest founding partners to leave their sexy jobs in technology. I was talking to people's parents about why they should drop out of school and come work on Long Lake and stuff like that. And it was a long process because I had to explain all of this, but now it's getting much easier. So, people have seen what we're doing, they're inspired by it, they want to join and be part of the mission. And so I think the team's getting better and better every day. Our rule is the incremental hire has to make us better, raise the average. And we've been able to do that, which is really extraordinary. And so, team's getting better. We're getting much more experienced. We've now bought close to 40 companies across five industries. We've built a process. We built a playbook. We have the Nexus platform, which we can redeploy. So our ability to drive impact is better. Our team is getting better. And so I do think our ambition level of, if it's not Long Lake that buys Amex GBT, who should it be? It should be us. That's kind of how we think about it. And frankly, we're thinking there could be other big things we can do. We're not going to stop, obviously. We want to keep doing this for the next 50 years.
· David Senra, Alexander Taubman
[00:00:00] S0: Give us some details about the size of the business today. [00:00:00] S1: We haven't disclosed valuations yet, but- [00:00:00] S0: We don't need to [00:00:00] S1: ... you'll get the first exclusive at some point. But I can tell you that including Amex GBT's big business and the scale of our other businesses is also compounding and getting meaningful. And so, if you combine, we're expecting to do over four billion of revenue next year. It's amazing revenue base. It's very stable, 100% dollar retention type business. I mentioned we have a lot of employees now globally, and we're very profitable, as you highlighted, because our strategy is to buy established, profitable businesses that already are making 20, 25% plus EBITDA margins. And so our view is we actually never need to raise capital again, which is nice. We're going to be generating enough cash flow on our existing assets that we could compound just on internal reinvestment for decades to come. [00:00:00] S0: Yeah, but you have a line of people out the door. [00:00:00] S1: We've had tremendous support and interest from investors to help inspire us to do bigger and bigger things. One of the nice things about being able to access capital is it allows us to think bigger and move faster. [00:00:00] S0: I was at dinner last night with Rick and Zach, your main partners, and they made the good point where a lot of founders fuck up because they optimize for valuation. And Zach and Rick made the point, it's just like, "Well, if we're going to be working together for 20 years, this is a long-term partnership."