From HOA Management to $4B in Revenue & $6.3B Deal for Amex GBT | Alexander Taubman, Long Lake

I want to start with the fact that you just bought a public company. You took it private. It's over 100 years old, and you paid, what, 6.5 billion for it?

Yep.

And this is Amex Travel.

Yep.

Can you tell the story?

We announced that we're buying American Express Global Business Travel for $6.3 billion. And, you know, it's just an unbelievable business. We've always respected this business. You know, it's a 111-year-old company over a century of customer excellence. And it was actually started in 1915 by American Express to help get their travelers' checks customers out of Europe during World War I.

I've been a customer of this business. Most people have. They do, you know, they manage the travel for some of the most iconic customers and businesses in the world. Close to half the Fortune 500, a huge percentage of the Global 2000, a lot of the U.S.

government and military governments around the world. It's a really remarkable franchise. And the opportunity to partner with them, take the company private, invest in growth, invest in technology, and bring AI into the travel experience for millions of travelers per year that they're supporting.

It's a big scale of impact for us to, you know, pursue the Long Lake mission, which is to deploy AI into the real economy. And, you know, travel is a huge multi-trillion-dollar global sector growing better than GDP, and we just think that we can have a massive impact here.

So let's step back, because me and you've been friends for a long time. Long Lake has always been a company that it's like, if you know, you know thing, where, you know, you guys had basically no public profile.

I don't even think you have a LinkedIn or anything.

True.

Yeah. So no public profile. You, I know everybody involved. Actively, we're, like, not seeking attention. Yet a ton of people were starting to copy your idea. And then I've seen some of their financials, and they're just, like, copying it way worse than you guys are.

So, like, for the people that don't have never heard of Long Lake, explain the thesis and explain why you thinkright now is the best opportunity to pursue that thesis.

We formed the company three years ago with the mission of basically bringing AI into the real economy. What we saw was an incredible revolution happening on the intelligence frontier, you know, dating back. If you had, if we had talked to each other four years ago after ChatGPT launched, and you told me that four years from now, back then, if you remember, the models were amazing, but they couldn't do addition.

And recently, the last couple of weeks, you know, the model solved some of the 10 most difficult, you know, unknown math problems in history and may win a Fields Medal. And if you had told me that that level of frontier intelligence was going to, you know, many people would have thought you were crazy.

It couldn't happen that fast. But a lot of people, and Doorkash was talking about this recently, you know, you would have thought in that world, everybody would be using AI everywhere. The economy would look totally different. GDP would have doubled or tripled.

What we saw, as we'd been working a lot with small businesses and in the real economy prior to founding Long Lake, that was my history for 10 or 15 years working with founder-owned businesses. And deploying technology innovations in the real economy is actually really hard.

There's tons of legacy systems, tons of legacy data, workflows, change management. And so being able to deploy these innovations at scale in the economy is actually really hard. And so we saw that with Long Lake, and the mission of Long Lake was really to be, you know, to help pioneer the, you know, bringing those frontier intelligence innovations and breakthroughs into real businesses and partnering with real American entrepreneurs and important verticals and important businesses where we could help diffuse the technology at scale.

We never wanted much publicity. We just want to be known for our work. I think, you know, my chief of staff, Kim, who, you know, she was in a leadership program, and the mantra of the leadership program was, "Talk less, do more."

And so that's kind of been, you know, our ethos. We just keep our head down and just focus on executing. It's a lot of work. It's really hard.

Hold on. I got to tell you a funny story about that. So I've spent a few times with a lot of people that know, like, these European private family dynasties,right, that never had, like, the companies aren't public. They don't seek publicity.

Like, you just, they're essentially hidden, but they're extremely wealthy. And somebody who told me one of their family mottos was, "To be, to not be seen." So, like, we want to be, but not be seen. I just love that idea.

Yeah. I think, look, I was very inspired, you know, growing up in Michigan in the Midwest. Like, there's some unbelievable entrepreneurs and businesses that have been built that are worth, you know, billions of dollars doing, you know, unsexy things like construction or distribution or whatever you might.

And people are very low-key. They're totally normal people. You don't, you know, so our view is we want to be the best possible partner to those kinds of business owners. You know, we want to, they've built, in many cases, I mean, Amex GBT is a great example.

It's an iconic franchise. It predates the invention of the airline. That's the brand, you know, that we want to sort of partner with and let them shine. Long Lake is just here to be sort of a deep, long-term permanent capital partner who's going to help you bring AI into the company, make your team members faster, better, smarter, make your customers happier.

But say specifically why you think there was such an opportunity, even three years ago, to bring AI into the real world.

The sort of diffusion problem is a really hard, hard problem. Several years ago, there was this question of, like, will intelligence work? And obviously, it's worked. And we're seeing that now and to crazy levels and faster. And I'm super AI-peeled always had.

That's why I, you know, left my old job to co-found the company. But it's happened even better and faster than, you know, even I expected. It's no longer a question of, does the technology work? Now it's a question of, now the markets are very concerned about, how are we going to finance all this?

And, you know, I think the real answer is we need to demonstrate, you know, you can borrow against future cash flows in order to finance this stuff. And people are now running into the trillions of dollars in investment to be able to scale the models to really where we want them to be in 10 or 20 years.

In order to finance all of that, you need to see a return in the real economy. So actually, one of the things Long Lake was formed to do is actually take those frontier innovations, deploy them into really high ROI use cases, taking away toilsome work from our team members, you know, mundane work, data entry, you know, process-oriented stuff that really a lot of people don't like to do.

And that taking that away and freeing up human capacity for, you know, more impactful work, dealing with the customers, focusing on growth, that's super high ROI.

Focusing on growth is really important. People think, oh, you take some technologists, match them with some PE guys, they're going to buy a bunch of existing businesses, gut it, replace all the humans with AI, you know, essentially cut costs.

And that's like the value creation. And that's not the thesis of what you guys are actually doing. You actually think that, and you're demonstrating that you're increasing revenue growth and you're actually not cutting people.

Yeah, absolutely. So this is like a contrarian take that we had in the beginning as well. We're very positive sum. You know, we really believe in this concept of like AI abundance. And if you look throughout history, you know, most innovations that lead to big productivity gains are actually good for the economy, good for wages, good for consumers.

And we think this is like, you know, just a sort of like a mega productivity gain. It's going to be good for everybody. And so what we're seeing in our companies, and we started in HOA management, and we've now bought, I think, 20-something companies in that space.

We've bought close to 40 companies now in total across, this travel makes it our fifth service line. And what we're seeing across industries and in our businesses that we've owned for longest, like HOA management, what we're seeing is significant job growth.

We're actually adding heads because if you think about it, if your people are 50% more productive and can handle 50% more clients and with better customer service, so you're retaining customers better, you're growing faster, you know, so the people are much more valuable.

Do you want more of them or less of them? You obviously want more of them. It's like a salesperson, you know, if you have a salesperson with AI that's now doing 3X quota, do you want to have like one-third the salespeople?

No, you obviously want, you know, as many of those people as you can have. And so I think this is all going to be very good for jobs and very good for US GDP and the economy. And that's a big part of our mission as well is basically bringing this positive sum, you know, AI revolution to the economy, $20 trillion plus dollar services economy in the U.S.

And, you know, obviously, you know, millions of people.

Wait, so you said you're in five different verticals now?

Yeah.

What are they?

So we started in homeowner association management, which is a actually really big business that people, you know, don't pay a lot of attention to, but there's tens of millions of homes managed in association. And so we're providing, you know, a now market-leading service and one of the fastest-growing companies in that space.

We then moved into HR services, specialty tax, infrastructure services now is a big area for us. So we have architecture, engineering, we're looking at other sort of businesses in that broader infrastructure space, and now travel.

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So I hang out with you guys a lot. We have a lot of dinners. I basically drop in on your office every time I'm in New York. I want to talk about the people that you've, like, pattern matched off of or that have inspired you.

I know we've talked about some companies in the past too, but people are like, "Okay, wait, this guy founded a company three years ago. How the hell did he just buy a 110-year-old company for $6.5 billion?" We'll talk about, like, your crazy revenue growth.

You're obscenely profitable. And I mean obscene the deepest love. I love obscene profits. What I understand about you, just from being your friend, is that it's like, you kind of have like a map of all. How do you think about this?

It's like, just the same way that Buffett, you couldn't tell him about an asset and he'd be like surprised, like, "Oh, I didn't know I wanted that asset." He's like, "No, I kind of like mapped out everything, kind of just waited for theright time, you know, if I could buy that company or could buy that asset.

Like, I already knew about it, I already studied it." You guys do the same thing, correct?

We do.

Okay. Why? And explain this.

Yeah. So we want to be doing this for a long time. You know, I'm still relatively young. I like to think I'm still young.

You are.

And, you know, our friend Zach tells us we're going to live to 150. So hopefully I could actually be doing this for, you know, at least 50 years, maybe 100 years. So in the fullness of time, you know, we'd really, we want to bring Long Lake and we want to bring AI to huge swaths of the economy.

We're now operating in, you know, roughly $3 trillion of the $20 trillion TAM, so call it 15% of the economy in the U.S. And now we're global. And we just want to keep adding to that. So over time, we'd love to be, you know, have a market-leading business and platform in many more industries.

But, you know, there's moments in time when you can find a great asset with a great team at theright price. And then there's other times where certain industries, you know, are not attractive for long periods of time. And so we take a prepared mind, you know, approach where there's this sort of our top 15 or 20 industries that we think are interesting for our strategy at any given time.

We're constantly force-ranking those industries based on what we learn, based on how, you know, market dynamics are evolving. And the best way to learn about is to look at deals in the space. And so we've built a really powerful sourcing engine where we're seeing 4,000 or 5,000 deals a year across all these sectors.

And we'll literally do, you know, one or two new industries per year. So it's a big funnel, very tight filter. And I can talk to you about, you know, how we select industries and assets.

That's literally what I was thinking. I was like, "Okay, when you're selecting, I assume this is operating at the founder level that, like, you guys are the ones selecting, okay, this is the industry, the next industry we're going to enter, correct?"

It's more based on opportunities coming our way. You know, to go back to Buffett, like, you know, you've got a better chance of getting a date if you're public and if you're bisexual, public and private, you know, that quote.

If you're twice the chance of getting a date. So we like to kind of keep an open mind. You know, if you're open to 20 industries, you're more likely to find a great business and a great team to partner with.

We just keep that funnel going all the time. We're constantly looking. And we just, when we see something, it's kind of like, you know it when you see it. If there's a great business like Amex GBT with high 90s, you know, logo customer logo retention, 100 plus percent kind of dollar retention with tremendous, you know, customer relationships with the best companies in the world, built, you know, average of 15-year relationship with their top, you know, couple hundred customers, deep, deep embedded partnerships where we sort of manage, you know, a mission-critical service for all these companies travel.

I mean, it's a small cost and it's mission-critical. You don't want to screw it up. We talk about that century of customer trust, but it really means something, especially in travel,right? If you have like thousands of people traveling in the Middle East and a war breaks out, or you have like a huge snowstorm in Chicago and your entire team gets stuck in the middle of the night at 2:00 in the morning, like things have to work.

Somebody's got to be able to answer the phone and know what to do. This is an amazing business. You just kind of know when you see it.

So wait, was Amex your first entry into travel?

Yeah.

Okay.

We had been building a thesis in that space for like a year, meaning looking at several other assets. It was on our whiteboard of industries that we thought was really attractive, you know, for reasons, you know, I'm happy to go into.

Yeah, I want to hear about this. Like, what do you think AI is going to do to this business?

I think it's going to make the travel experience much more seamless. I think things can be much more personalized, more proactive. You know,right now there are a lot of legacy, messy data issues and, you know, systems issues in the travel space.

You have like these, you know, supplier systems and customer systems and distributor systems and it's a longstanding industry. So over many decades. And so it's kind of complicated. But one thing, as an example, AI is really good at this is like, you know, our friend Scott Woo obviously like is, you know, Devin and things like that, integrating messy systems.

And this is what we've built Nexus to do. So Nexus and, you know, our co-founder Rasmus Visman comes from like a data and he's like, what's the top, you know, computer science PhD at Oxford. He won the prize for the best thesis.

And he's like amazing at building, simplifying complex, you know, messy data structures. And so Nexus, our AI platform, is built specifically for this use case. And so we think about how do we make this happen?

Let's not move on because I know what Nexus is. The person listening might not explain what Nexus is.

Yeah. So Nexus is our horizontal AI platform that we've been building, you know, across verticals. And so we've been investing and part of the reason we're in multiple verticals is I think scale's, you know, increasingly important in an AI world in general.

You're competing for the best talent. Being able to leverage innovation and building a platform across five, ten, you know, 15 different scaled industries allows you, I think, every single industry we go into, it makes Nexus better. We gain, we add additional capabilities.

Why does it make it better?

So as an example, about 70, 80% of the infrastructure is shared across the verticals. And that's kind of like our, you know, it's our platform where on one side we integrate with all the models, we're model agnostic and we kind of use different models for different tasks or even one task might be using several models just to complete one task.

On the other side, you integrate with the data, you know, the workflows and the different software systems of the business and you have to build that deep integration. So Nexus sits in the middle. A lot of that, you know, intelligent model routing, security, you know, sort of agentic orchestration layer, things like that, that's reusable across all the industries.

That last 20 or 30%, which is embedding Nexus into the workflows of the business, mapping the workflows, integrating with these different data sources, that is what takes, it's a very hard technical challenge. It's why you need like a world-class AI team to be able to actually use AI in the real world because you have all these systems.

Hold on. This is a really important part too because again, I hear other people talk about Long Lake and I'm like, "Oh, they don't actually understand what you guys are actually doing." Like, how many different states are your engineers operating inright now?

They're not fucking just sitting in New York.

Yeah. I mean, we're operating in probably almost every state at this point. And our engineering team will be, you know, I'm guessing 70% of the engineering team today is probably sitting with a team member in the field across, you know, 15 or 20 states.

And they're working on that last 20%.

Exactly. Sitting with our team members, understanding the pain points, what's breaking, what's useful, what's not useful, and iterating. And we, you know, we, to your point about learning from greatest histories, his history is greatest entrepreneurs. Like Kelly Johnson, very inspiring on this.

You know, the skunk works. Like you want the engineer sitting in the factory. And that's actually kind of what Long Lake is.

There's a book on the counter behind there that's unreleased and it's all about like SpaceX. What's fascinating to me is I just did an episode of Founders on Kelly Johnson because in the preface of that unreleased book, he talks about, he's like, "If you just go back and read Kelly Johnson's like 14 points and the way he operated Skunk Works," it's like it reads exactly like what SpaceX is doing.

These ideas are not new.

Yeah.

You just use over and over again.

The other great motto that I love is on this point is from Danaher, who's a big inspiration to us also, the Reales brothers, is their motto was common sense rigorously applied.

Yeah, it's excellent.

And so if you, that's kind of what we do too. If you can take some of the world's best AI engineers, they can sit with your team members, understand the problems, and we can use common sense to fix them, it makes Nexus better.

So Nexus now integrates better with all those various systems and each different industry needs different things. So for example, in HOA management, it turns out a lot of the work is done in email. So you're taking in emails from homeowners and boards and responding.

And they're complex emails. It'll be like, you know, "What's going on? We need to find a snow removal company." And so it's not just a simple response. You actually have to go map out, "Here's the 10 other communities we manage.

Here's the five vendors. Here's what they charge you. Here's how people reviewed them. Here's the schedule." You might need to actually send an email to the vendor, get schedules, and then respond. That email could take 45 minutes, you know, or an hour or longer to actually craft a thoughtful sort of response and proposal.

If Nexus has access to all that information and can draft an email for you before you even wake up in the morning, you have a draft in your inbox to respond with an accurate, with a 99% accurate, and then you can just edit it as the manager.

So now instead of spending an hour, you spend five or ten minutes, you know, putting it in your own voice. And by the way, the voices are getting better and better now. This is something we're working on to each of our managers now can have Nexus drafting emails in their own voice.

And, you know, so this is like a capability that we built for HOA management, but it's now applicable to every other business. Turns out pretty much every business works a lot in email. Travel, for example, 55% of travel agent inbound queries from travelers is in email.

New bookings, changes, cancellations, it's all in email. So because we solved that problem in HOA management, Nexus is now better, has this tool built in, it's going to day one have a huge impact in Amex GBT. And I could give you 10 other examples of this.

Has anybody tried to buy Nexus as a separate tool?

You know, it's funny, we do, it's, you know, because we haven't been very public, not a lot of people really know about what we're doing, but a lot of our investors have asked us, "Can we partner to use Nexus?"

And maybe for them we would do it, but we've never wanted to sell software. First of all, software obviously is a great business. We partner with tons of software companies in all these industries and with the labs, et cetera.

But the problem with selling software is you don't actually care about what happens in the outcome. So for us, we're very outcomes-driven. We want to really actually change the way these businesses operate, change the way these industries actually function.

And to do that, you need to be an owner. You need to really be an owner-operator. And so taking Nexus, taking the AI breakthroughs that are happening at the frontier, deploying them into the businesses for real outcomes, i.e., faster growth, better customer experience, better team member experience, being able to pay your team members more because they're more productive.

And then ultimately, to your point, shareholder returns, that's what we're focused on. And I think the vertical integration of owning your own platform and deploying it only into your own companies creates a lot of alignment.

We've talked a bunch about all these other founders episodes and I love that you're part of your onboarding on Long Lake is listening to specific episodes of founders, which I think obviously is fucking genius, but I'm biased on that.

But I think this is, because I think, again, especially like on the investor side, it's like, "Oh yeah, let's just sell the software." It's just like, well, it's not a, I go back to like Larry Ellison, I've done like, I don't know, six episodes on him.

And he has this great line about this, you know, he's the, maybe the best in the world at understanding this. He's like, "It's not a software problem. It's a human problem." It's like, you can't, like, there's no point in me selling something if your work, if the way you work doesn't change.

It's like, then I can't build a good business around that. And it's like, okay, so how do you get over the human problem? Well, you own the goddamn company. You control the workflow.

It's interesting because

a slightly non-obvious thing with this is we don't actually force anyone to use our tools. So owning the company is really valuable in a lot of ways, but not because we force people to use the tools.

That was the Larry Ellison's point. You can't force them.

If we have to force someone to use our Nexus platform, then the platform's not good enough. We take an approach of our, the customer are our team members. And we're now going to have 30,000 team members operating globally across all these sectors.

And so.

Wait, explain that to me.

We're 30,000 people working at.

You said your customer or your team members?

Yeah, we think of our team members and we now have 30,000 of them globally as our customer. And so the whole idea is we want Nexus to be so magical.

30,000 employees in the businesses that you own.

That'sright.

Okay.

And I have to always convert. I love you, but you're like an East Coast finance guy. And I always have to convert the way you talk. We think of them as partners, you know, design partners, and that's our customer.

And so the whole idea is we want it to be so magical that when you introduce the tools to them, it goes viral inside the company. And we've now seen that. And each, we are, it's happening where as the models get better, as our products get better, and as our deployment playbooks get better, we're seeing the cohorts of adoption going crazy.

Like it used to take us like maybe, I don't know, six months or something to activate a cohort. Now it's like you give them the tools and in like, you know, days.

And wait a minute, hold on. Am I understanding this correctly? So you're targeting these services. So let's say HOA management,right? And let's say I work there and now I'm using Nexus and all the other tools that you guys are building,right?

Because you're, and we'll talk about how you got elite technical talent too,right? My job is now fucking 90% better. That also protects you for retention.

100%.

Because like another HOA service company that doesn't have these tools, I'm going to go over there and work 90% more.

Yeah. No, you don't want to do that. That's, this is a big part of our vision too, is that we want, we really want to be a talent magnet. We want to have, we want to be the best place to work in every industry that we operate in.

And part of that is if you can build people the best tools, make them more productive so they can make more money and have a better job. And by the way, we have these amazing quotes now from our team members.

They're saying like, "I don't feel like I'm working anymore." Because there's so much mental friction that comes from that 30% of work that's, you know, this manual rote, responding to emails, data entry, dah, dah, dah, dah, dah. What they want to do is they want to focus on getting more customers, understanding the, you know, helping the customers more, interacting more with them.

You know, there's a lot of fun parts of the job that keep people going. If we can do more of the fun parts, less of the dull parts, they love their job more, they can make more money. And so then think about having to leave a Long Lake partner company that has these tools and this setup and go to like, you know, a competitor down the street.

You're not going to.

It's going to become really powerful. We're already starting to see this. We're obviously only a couple of years in, but if you think forward and this flywheel then, if you then have the best people in every industry using the best tools creates a much better customer experience.

And then you grow faster, you retain your customers better, you make more money, you can pay your people more. That's the positive sum, you know, vision of, for us, of AI deployment is you can really create a better mousetrap in all these industries.

Why should you be the one buying these companies,right? So we'll talk about that in one second. So the way I think about it is like, you have a ton of experience,right, in finance, what you were just telling me and my partner before we started recording, it's just like, you blew his mind because he didn't even, he was thinking about the same thing you were thinking about and you're like, "Hey, you didn't think about this other part, this missing piece, which we'll, we want to talk about."

But like, that's another example. I've seen you do this a million times. And then with Zach, it's just like, he's going to be able to recruit the best technical AI talent in the world. And that's how I see the combination that like everybody's like, "I want to do what Long Lake does."

Yeah, but you're not Alex and you're not Zach. Am I wrong about this?

Well, thank you for saying that. We've got an amazing team. We go back long ways. Zach and I first met at Goldman when he was a summer analyst. I was an analyst. He introduced me to Rasmus, our co-founder and CTO, who he was at Oxford with at the same time as, you know, I mentioned was top student there.

The sort of team came together through network. And so, you know, the first 20 people, I think, were all from like, you know, network and people that we knew deeply from both an investment acquisition side as well as applied AI technology.

We're growing much faster now. We're closer to 60. I mean, we're still small. At Long Lake level, we're only about 55, 56 people now. We'll probably be, you know, closer to 100 people by the end of the year.

It really is a world-class team. It's, you know, it's, I'd say 90% AI engineers and operations deployment folks, and then 10% sort of acquisitions, you know, M&A finance. But yeah, I do think you need to be able to do three things really world-class to be able to deploy this technology.

You need to be able to buy great companies well. So you need a great M&A function. You need to be able to build amazing world-class technology. So you need world-class technology that rivals, you know, the labs or some of the best, you know, applied AI companies.

And then you need change management operations. Because we were purpose-built and because we started with the big vision of we want to really kind of help change the whole economy, I think we were able to attract, you know, much better people.

And that's been, you know, that's been starting to compound now. And, you know, we still, I think 75% of our teams come from referrals, from in-network referrals. So we have a very strong, and it's a very tight filter, as you can imagine.

I mean, I think this quarter, you know, we hired 3% of applicants basically. And we saw, I don't know, close to a thousand applicants this quarter. So we have a very tight funnel, just like we do for deals.

And, you know, I think one of my biggest learnings is just high bar in everything is really the key. And so high bar in talent, high bar in acquisitions, high bar in technology. And that's kind of what I think you need to make this work.

What initially got you interested in finance to begin with?

I just loved it. I grew up in a family of entrepreneurs. My grandfather, who was a big inspiration to me, started a real estate business after World War II.

He essentially invented the strip mall.

Yeah, the shopping center. Yeah, yeah, yeah. Exactly. He didn't actually do strip malls. Well, he did probably earlier in his career, but he invented it.

There's a great book that you gave me about him called "Threshold Resistance." Can you talk about the idea? Why would it be called "Threshold Resistance"?

Yeah, so the concept, by the way, it's, you know, it's a fun reference. We have it in our office. But basically, the whole concept of threshold resistance is you want the shopper to be more likely to go into the store.

So he was sort of an early pioneer of retail. He just thought he could make things better. And it was actually, that was a big inspiration to me, try to make things better in life. And so one of the ideas was, you know, the threshold is the entrance to the store.

And the more you had to step up steps or go down some dark hallway in order to get, and that's how stores used to be designed. There used to be these big windows with big, you know, with merchandising in them.

And you'd have to go through the windows in some like dark alley in order to get to the door in the back. Nobody fucking wanted to go in them. So his idea was bring the door to the front, have no threshold, have it be the same, you know, like that over there.

You can't see, but that you want to walk through that.

Because even a step, he broke it down almost like a math equation. Like even like half a step up or reduce it by like 20, people coming by like 20%.

Exactly. He did a lot of really creative things that, you know, I can tell you more about it. He was very innovative and he always brought this kind of continuous improvement mindset, similar to like the Danaher continuous improvement concept.

And honestly, it's all big inspiration for me. You want to make it so easy and so magical for the shopper to go into the store that they'll go in and spend more money ultimately, which is good for the store and all that.

And actually, some of those principles, like I think you can apply more generally, like with technology, for example, we want to make Nexus so magical and so easy to use that our team members just love it and they can just use it.

You want to minimize threshold resistance on AI adoption.

This is exactly what we were talking about. It's like, hey, you know, the reason we can have this horizontal AI platform is because 70, 80%, it's like every business deals with the same shit.

Yes.

When you were just talking about this, I just recorded this crazy episode with Travis Kalanick from Uber. It was fucking crazy. Sat exactly where you are. And we talked for hours. And he was breaking down in like my new detail about even like the, every single page you would see at Uber compared to like Lyft.

And it's just like every single little thing. It's like, there's a thousand things I had to optimize. That if you're just copying me, you're like, you copy what you see, but you don't understand the thinking behind it. And it's exactly what you're talking about.

It's like this guy's just obsessed with shopping malls or shopping centers and realizing that, hey, I'm going to knock six inches off here and my bottom line, you know, my profit increases by 25% or whatever.

By the way, I think it's very much the same with technology and websites and, you know, Amazon that came later and things like that, which was just these little tweaks can really impact behavior. And, you know, just by making things better.

Both my podcasts, like founders has no intro. I just getright fucking into it. And this one has like a six-second one. It's like, no one wants to sit through that shit.

Yeah.

Like I want, I'm listening to your podcast so I can hear some 30-second melody that you made. Like, no, this is not a concert, dude. Getright to the point.

Yeah, exactly. So I grew up in this family of entrepreneurs and my father and uncle ran that business for 75 years. And so one of the inspirations, we called the business Long Lake because that business was built and lived on Long Lake Road for the last 40 or 50 years in Michigan where I grew up.

And there's actually a funny story about.

I dismissively called you an East Coast finance guy, which you know I love you and we're friends. I was like, shit, I forgot he's from Michigan.

Yeah. I basically just really grew up kind of with a tremendous respect for like the American entrepreneur. And growing up in Michigan, you know, I mentioned earlier, but you know, all these incredible entrepreneurs in businesses that you've never heard of.

The people in Michigan and the community, the business community you looked up to, there was no finance scene there. There was no tech scene there. It was people that built, you know, these, what, you know, people might, people on the East Coast might call unsexy businesses, but they're amazing businesses that you've built, you know, over 50 years or 75 years in the case of my family.

And these people that built them are extraordinary people. As you know, they're classic American founders and, you know, bootstrap their way in, you know, to build what could be a huge business over time that provides an unparalleled service in that market.

Like, you know, we partnered with an architecture business in Minnesota that's built 50% of the K through 12 schools in Minnesota the last 70 years. I mean, they are like the McDonald's of, you know, architecture for schools. And this is why it's such a great country.

You can go to any region in the country and any service line and there's someone that spent a hundred years obsessing over that product and service. And so growing up, you know, seeing this and around, you know, at the dinner table, meeting some of these people, and it was very inspiring to me.

And so I think part of the reason that I was uniquely interested in this problem and mission was, how do we bring the best of the intelligence revolution and the best engineers in the world to help these sort of iconic, you know, American entrepreneurs across industries, you know, deploy AI into their business to make their team members, employees happier, make their customers happier, improve their bottom line, I mean, and grow faster.

And by the way, if you do this in enough industries with enough businesses, you're eventually going to add up to really contributing to the economy in a big way. So I think there's a long-term over decades opportunity to make a meaningful contribution.

You know, I don't want to overstate our role in the intelligence revolution, but I think actually deploying the technology in the real world, driving real ROI, which by the way, and I was sort of starting to get this earlier, but by driving real ROI, we're actually generating cash back into the system to scale the models.

And so you actually need this flywheel. You need someone, you need distribution. And so part of the mission of Long Lake was.

Oh, your distribution for the labs. That's hilarious.

Yeah. We generate ROI in the real economy on the intelligence to reinvest into scaling the models.

That's funny.

And someone's got to do this. And by the way, you're seeing the labs start to dabble in the deploy codes and things like this. But I think somebody, you know, and many people, it's not going to be one company.

You talked about, you know, other, you know, people. People often ask me about competition in the space, you know, people trying to do what Long Lake's doing. And I think it's great because I think to actually scale the models, we actually need to deploy this technology at scale, which is going to be, you know, this is a big economy.

And by the way, it's a global economy too.

And it's going to happen slowly. Like the technology changes way faster than human nature does and human behavior does. The bottleneck is changing actually what people do.

And there are real hard technical problems. And, you know, like Rasmus and, you know, a bunch of our co-founders like Varun and founding engineers are, you know, critique to Raz. These are some of the best engineers. They all, you know, any one of them could raise money from a top VC tomorrow to start their own company.

Any one of them could go get offers at, you know, amazing, whether it's the labs or some amazing software company. You need people like that. These are really hard technical problems. And what they would tell you is it's really interesting work because it's not easy to figure out how to, you know, take a hundred-year-old businesses, systems, and data and problems that are global with each customer having some different optimization that it needs, like in MXGPT, for example, and somehow scaling that with Nexus and diffusing AI into that whole stack.

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Okay, so you're meeting all these entrepreneurs you're growing up. You grew up in an entrepreneurial family. These are family businesses. When did you start paying attention to finance though, in that aspect of it?

Yeah. So I knew I was really interested in business and I wanted to learn about, you know, capital markets. And I started my career at Goldman. That's where I met one of our co-founders, Zach, who, you know, helped introduce me to Rasmus and sort of all this ended up coming together through that.

But when I was at Goldman, I worked in the internal investment unit, which was called Special Situations Group. And it doesn't really exist in the same way because of regulation now, but at the time, it was a very cool group, which I, you know, I can talk more about.

But I sort of just fell in love with this whole idea of capital allocation. And I had some really amazing mentors there. And the whole idea of putting resources of the economy into the highest and best use and the whole concept of capitalism, I just kind of fell in love with it and capital allocation across industries.

That was one of the beautiful things about SSG at Goldman at the time was the pitch to young people coming out of school was, you know, you get to sort of investright away. You get to, we invest up and down the capital structure from debt, you know, down to equity, public and private, across all industries.

So I just got tremendous exposure at a young age to all these different types of businesses and ended up working on some really interesting investments there. Learned a ton by sort of, you know, not just observing, but also like getting to manage risk at a young age, which was a very unique experience.

Young age is what, early 20s?

Yeah, I think I was like 22, 23.

Okay.

And actually, I had a great mentor there who I later partnered with and worked with at Oaktree, a guy called Patrick McKaney, who empowered me very early, I think in my first year, to basically manage like a couple of hundred million of invested capital.

I mean, he was helping me, of course, and, you know, he gave me a lot of guidance, but he empowered me to like take real risks early in my career. And that was very formative for me. And I realized I just, I loved investing.

I loved allocating capital and I loved businesses and learning about, you know, how the world works. To me, like understanding how these different businesses work and all these industries is sort of like really understanding how, you know, the economy in America really functions.

And so I love that, the intellectual curiosity of just learning more about how different things work.

So wait, then you go to Oaktree.

It's funny, you know, people ask me about Long Lake. I never could have told you at any point in time that I was going to be doing what I'm doing today.

Did you think you were going to found your own company or you thought it was going to be a fund? Like, what'd you think it was going to be?

I didn't know what I wanted to do. I was very focused on just continuing to learn and get better and improve my skills. So after Goldman, I went to business school and I actually, you know, what I was going to say is my favorite case was Danaher.

I've talked about Danaher. They're big inspiration for us. The idea of like having that long-term compounding model where you have a structural advantage, you can operate the businesses better, you can have a better cost of capital and you can have the best people and all that.

Hold on. Let's come back to Danaher because I do, I want to hear about that. Danaher, which you and I have talked about before, but also the other people that you guys look up to and you emulate. But you go to business school.

So I went to business school. I ended up interning. This is like, I'm just going chronological order, but I ended up interning at a holding company called Leucadia. So I was interested in holding companies. And then I spent some time hanging out with Josh at Thrive.

So basically, I was always interested in technology and holding companies dating back 15 years. None of this clicked for me until much later. So I went to Oaktree after business school. I graduated. I decided I wanted to stick with investing and partnered with the guy I mentioned, Patrick.

And we worked directly with Howard Marks and Bruce Karsh, two legends of the investment world, to build kind of some new businesses for them. We had started Oaktree's first equity business. We ended up getting involved in some of their credit businesses and helping out with a few things and doing, you know, we started several different products there and worked very closely with Howard and Bruce and just had a tremendous amount of fun, learned a lot from them.

But the whole time, I knew I was not sort of fully expressing myself. I eventually wanted to start something, but I didn't know where it was.

On your own.

Yeah.

As a founder, even if it was going to be a fund or an investment company.

Yeah, I think I just knew I wanted to do something entrepreneurial. I wanted to build something and I wanted to, you know, do something on my own. But I didn't really know what it was. But then, you know, when I started really thinking, after I was at Oaktree for almost 10 years, I started really thinking and, you know, brainstorming with some of the early co-founders of Long Lake who we've talked about.

And, you know, the ChatGPT moment came out and it just became very obvious to me, like this was going to be great.

But wait, where was the Taubman Capital? When did that happen in your life?

Yeah, so when I was at Oaktree, you know, I mentioned, you know, my dad and grandfather's business and I was helping, working with our family to build out Taubman Capital, which is our kind of family investment business, which is all our own money.

And we ended up partnering with, you know, we did a bunch of these deals with investments in founder-owned companies. And we did, I think, close to 50 of them.

So that's where you learned how to buy companies, do you think?

Yeah, it was a combination of stuff I learned at Oaktree and stuff I was doing with Taubman Capital. And Oaktree stuff was generally larger companies, public companies.

Yeah, but the returns you had at Taubman Capital, you don't like talking about this, but I'll just say it and we can cut it if you're embarrassed, but it was like something like 70% IR or some shit like that, correct?

We had a very good run. We had a very good run. But yeah, it was an eye-opening experience for me because what I realized is we, you know, there's some remarkable businesses out there. And just because something is a small or mid-sized business doesn't mean it's a bad business.

Actually, I mentioned that, you know, there's some Minnesota we partner with that's been building all, you know, most of the schools and entire state for the last like 70 years. It's an amazing business. And so my learning was there's some unbelievable entrepreneurs.

Going back to my roots in Michigan, it really resonated with me to be able to partner with some of these folks and help them grow their companies. And so, you know, to your point, we had a very successful run in bringing sort of permanent flexible capital, which was our own internal balance sheet, a long-term horizon, being comfortable, and not just comfortable, very encouraging of investing in growth.

We don't, you know, we're not focused on short-term quarterly earnings. We're not over-levering the companies, you know, like a lot of private equity funds do. We basically are a long-term growth investor in great American businesses, partner with great founders, and we can bring them things that they may not have.

Like for us, it was helping them get growth resources, helping them get M&A resources, helping them have capital. You know, a lot of folks have built an amazing business, but they've never done an acquisition before. And they may have tons of competitors that they could run the business better than.

And we can help them go and consolidate that industry and become a bigger scale player and get the sort of industrial logic of that. And so we had a lot of fun. That was sort of nights and weekends for me over the 10 years, you know, when I was working at Oaktree.

So that was a very formative experience as well. Long Lake, it all clicked. You know, it turns out I was always passionate about, you know, partnering with founders. I was always passionate about technology.

Passionate about capital allocation.

Yeah.

And then now you met theright people where you could actually build a unique partnership that very few people can match.

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, you know, 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, you know, it's an amazing group of people, Elad Gill, and, you know, they've basically really pushed my thinking in a big way since the beginning.

What Rick tells me about you is that you're unusually receptive to both new ideas and criticism. And a lot of founders, obviously, you know, are more like kind of headstrong and, you know, less, usually they'll listen, but they're running the ship, you know?

Well, that's nice of him to say. I think feedback's a gift. We want to get better every day. Just like, you know, 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, you know, 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.

I know this.

Long Lake onboarding includes like half a dozen of your episodes.

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 Long Lake. You guys are talking about this thesis for what, six months, a year?

Like how long does it actually take? And then we got to talk about the fucking crazy growth that you've had in the last three years.

Yeah. So yeah, Zach and I, you know, we go way back. We started, you know, at Goldman, as I mentioned, and we'd stayed friends a long time. And, you know, he's done some amazing things in technology, brought me into some of those things.

That's an understatement.

And then, you know, he was very inspiring on that. And then he was coming into some of our Taubman Capital deals. And, you know, 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, you know, 20 different locally owned go-kart tracks and created a platform. And so Zach invested in that deal with us. And, you know, we realized, you know, 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, you know, some of the companies like, you know, Ramp and Cognition and the Labs, and you could bring some of these, that type of world-class AI team to, you know, the mainstream American businesses and enterprises.

And that was the idea.

Was it that idea from the very beginning?

It was that idea from the very beginning.

So from that, the conversation you guys start having about this to, shit, we're going to start the company to it's founded, what's the timeframe there?

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 theright team at theright 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, you know, excited about what's ahead.

You know, our bar for what we want to build and what we want to do keeps going up every day.

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.

Our vision is really big. I mean, it sounded kind of crazy when we were a couple of years ago when we were saying, you know, we want to deploy.

But it sounds just your vision. Like, the way you guys are executing is even better now. Like, you're getting better. You guys are getting, you're already super impressive, but you are literally getting better.

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, I do think it's true.

Oh, can we talk about the story? You guys were thinking about like a few acquisitions and we don't even 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?

Exactly. Sometimes we like to say, you know, I think the greatest gift that you can have in a partner is someone who makes you more ambitious. And I think our, you know, our partners today really make us more ambitious.

And when we started the company, we talked a lot about how, you know, if we do thisright, 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, you know, with tens of thousands of team members, you know, it's starting to feel like it's coming alive.

And so I think that's really exciting, which means we're able to, you know, it's much, I remember in the beginning, like convincing some of our earliest, you know, founding partners to leave their, you know, sexy jobs in technology.

Like I was like talking to people's parents about why they should like drop out of school and come work on Long Lake and stuff like that. And it was like, you know, it was like a long process because I had to like explain all of this and, you know, 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. Like our rule is the incremental hire has to make us better, make the average, 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 experience. We've now bought close to 40 companies across five industries. Like 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, you know? And so I do think our ambition level of like, if it's not Long Lake that buys Amex GBT, like who should it be? Like it should be us.

That's kind of how we think about it. And frankly, you know, 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.

Give us some details about the size of the business today.

We haven't disclosed, you know, valuations yet, but.

We don't need to.

You'll get the first exclusive at some point. But we, you know, I can tell you that including, you know, Amex GBT is a big business and the scale of our other businesses is also compounding and getting meaningful. And so, you know, if you combine, you know, we're expecting to do over $4 billion of revenue next year.

You know, it's amazing revenue base. It's very stable, you know, 100% dollar retention type business. You know, I mentioned, you know, we have a lot of employees now globally and, you know, we're very profitable, as you highlighted, because our strategy is to buy established profitable businesses that already are making 20, 25% plus, you know, EBITDA margins.

And so our view is, you know, we actually never need to raise capital again, which is nice. We can, you know, we're going to be generating enough cash flow on our existing assets that we could compound, you know, just on internal reinvestment for decades to come.

Yeah, but you have a line of people out the door.

We've had tremendous support and interest from investors to help inspire us to do bigger and bigger things. I mean, one of the nice things about being able to access, you know, access capital is it, you know, it allows us to think bigger and move faster.

And I was at dinner last night with Rick and Zach and, you know, your main partners. And they made the good point where, you know, a lot of founders fuck up because they optimize for valuation. And, you know, Zach and Rick made the point, it's just like, well, if we're going to be working together for 20 years, like you should be, this is a long-term partnership.

Like you can't just, it's not a bidding contest. It's just like, who can you work with? And who actually, to your point, like not only do you get along with, you actually want to do life with, because we're all going to have more money we can spend anyways.

So it's like, who do you get to spend your time with? Like doesn't, shouldn't that matter? And then the second part of that is, is like, are they actually helping you on your mission and increasing the size of your ambition?

No, listen, I 100% agree. I think it's about having theright partners. And so, like, you know, I mentioned kind of growing up and, you know, in our family in the real estate business, my father and grandfather had partners for 50 years in some of their real estate deals.

And so being a partner was like almost higher than being family. It was like someone that you treat with like the highest respect.

You guys are loyal guys. This is what I like about you. You know what I mean? Like there's an army, like you're fucking way too humble and you're always going to be like that. So nothing I'm going to tell you today is going to change that.

But like there's an army of people trying to put more money into your company that would probably, you'd get obscene terms. And it's just like, yeah, but I like these guys. These are my existing partners. My version of this is like every fucking company comes and it's like, do what you have with Ramp, we want that and we'll pay double.

And I'm like, you think this is like a bidding thing? It's like these are like some of my closest friends. They're the easiest people to work with. Like fucking they backed me and they, what at the time was the biggest deal in Business Podcasts, the partnership we had.

This is like just because they had intuition that this is fucking valuable. You think I'm going to exchange and destroy that fucking relationship for money?

Yeah.

Come on.

Exactly. I agree. I mean, it's one of the things we're super grateful for. When we first met with Hemant about this and he was our, you know, GC led our first round of outside capital, gave us our first hundred million bucks basically when, you know, that was, you know, remember this was three or four years ago.

That was a lot of money back then. And, you know, and by the way, they've given us a lot more since then and been incredible partners. You know, from day one, they got the thesis. They believed in us almost in a way before we even believed in ourselves.

And that's such a gift that we'll always be grateful for. And, you know, I just want to keep working with these guys, you know, our investors that we have. And obviously we like bringing more people into the mix.

And there's been some extraordinary people that have come in recently, like many great people that you know. And so we want to keep building that. I do think like continuing to kind of expand our world a little bit is very valuable.

Each time new people come in, they add a lot of, they add a lot of value to our thinking and all that. But yes, it's about much more than capital. It's really about how do they help us execute?

And the biggest way they help us execute is by believing in us and, you know, inspiring us to move faster and think bigger.

Does Long Lake have to be public?

It doesn't have to be public. No.

Would you think it will be?

I think the maximally ambitious path is to be public.

Why? Why is that maximally ambitious?

Because I think we'll have ultimately deeper and lower cost of capital, lower cost capital. And just, you know, the public markets are the biggest stage in terms of deepest pools of capital. And I do believe, and one of the things about some of the great holding companies and, you know, people like Henry Singleton and others and John Malone, they've all proven this over time is that if you execute over a long period of time, you earn a currency that trades at a lower cost of capital.

And then that allows you to do even more ambitious things. And so by getting, you know, access to that over time, we can think even way bigger. So I think there's some, you know, potentially to scale our impact to even larger and larger businesses and industries, you know, over time, I think having that currency will be very valuable.

What else did you learn from Singleton? You and I have talked about Talodine a bunch.

Yeah, I mean, he's probably like of all the holding companies, one of the people that's inspired us the most. I mean, first of all, he was a math genius. He was on the Putnam team at MIT. He was in the Office of Special Services.

I mean, you did, you know, you sent me the book, I think, Distant Force, which is a great book. One thing that people don't understand is Singleton compounded his earnings per share of like over 40% a year for 20, 25 years, you know?

People, and Buffett always called him the best capital allocator in America and the best operator. And he was very kind of under the radar. The biggest learning from him, I think, is he used to say, stay flexible. His mantra was, he didn't like detailed strategic plans.

He preferred to stay flexible.

He says, I prefer to steer the boat a little bit every day.

It's a great quote. It subjects all these outside forces.

Yes.

And nobody's smart enough to predict them. So you just need to come in and steer the boat every day. And so I think that's part of our whole philosophy of staying open to different industries, the, you know, the flexible capital allocation mantra of, you know, for example, we never would have said when we started the company that we wanted to do travel.

It wasn't, it just wasn't something I'd thought about. We eventually built a thesis on it, but that was because we had an open mind. And now we're doing, I think it's one of the most exciting deals we've ever done.

I mean, it's like an unbelievable iconic business with a reputation for, you know, you know, gold-plated customer excellence with one of the best, you know, AI opportunities to improve the service at a pretty reasonable multiple, actually, when you look at it.

And had we not kept an open mind and stayed flexible about industries, we never would have looked at it. You know, I think that's a very inspirational principle to us that we try to embody.

What about John Malone? Anything from him?

Yeah, I mean, he was amazing. I was studying him at Oaktree and actually we invested in a number of his stocks over the years. You know, I think just creativity on structuring and creativity on financing and things like that, he was kind of, you know, top of his class.

And another thing, you know, I read in Cable Cowboy that he liked, he was a very first principles thinker, which, you know, he would do like ask why five times, get to the root cause. Like he was a big root cause thinker.

And that's something we try to also embody in our, you know, in our investment process and our capital allocation process. We want to always understand why is a business good business? Because we do plan on doing, you know, you talked about permanent capital, we want to be doing this for decades.

And so it's actually very hard to think out 20, 30 years on what's going to still be a great business, especially now.

Yeah, especially now.

So first principles thinking about why a business is going to be great post-AGI is really important. It's maybe the most important thing in capital allocationright now. And I think stock selection, stock, it's like a, they used to say it's a stock picker's market, meaning there's going to be winners and losers, a lot of dispersion.

I think there's going to be a lot of dispersion in the next 20 years between the best assets and mediocre assets in terms of, you know, a post-AGI, you think about how industries are going to shift.

The gains of the winners is going to be even more extreme in a post-AGI world. Is that what you mean?

Yeah, I think there's just going to be a lot of dispersion. I think the gains to the winners is going to be extraordinary.

Yeah.

And businesses that, you know, are well positioned, that are high quality services, that are going to preserve their place in the ecosystem and expand it, which we think our businesses all fit that mold, you know, can become orders of magnitude more valuable.

But businesses that are lower quality, easier to disintermediate, aren't providing a sort of a enduring value added service and really are more of like a tax. Some of those are just going to go away.

Yeah.

And that's good for the economy, by the way. Less friction is good. But I think thinking through businesses holistically and sort of thinking about what makes a business sustainable or not, enduring or not.

Have you guys bought any businesses that were weaker than you expected? And have you sold any of them or no?

No, we've never sold anything and we don't plan to ever sell anything. You never say never.

Yeah, of course.

It's more about, are we adding value to the business? Is it a business that Long Lake should be in? I think that's the bigger question. You know, if you're going to invest all this time and energy to get into a great business with a great team, you know, build that partnership, deploy tech, build, you know, Nexus to deploy into that space, create the best technology in the space, the best people, the best team in the space, and then you're going to sell.

Like that, you want to let it compound for a long period of time.

So I just had a thought and I don't even know the answer to this question. You guys are acquiring businesses. Have you guys had any acquisition offers for Long Lake itself?

Everybody knows we're not a seller. So we haven't really entertained or had any of those conversations. My plan is this is what I want to be doing forever.

Okay, I'm on a runright now. So Torsten, there's a bunch of these episodes aren't even out. Torsten from Housing, he sat in the same chair and he's just like, he's legitimately mission driven. He's just like, I'm building a great European defense company because he's already rich.

Like he was rich when he started the company. And he's just like, you know, because like Europe has to be able to protect itself. So this is like, this is a mission driven company. He's like, we're not for sale for any price.

You know, Scott Woo, I push him on this a lot because billions are getting thrown in that guy's face. And he's like, nope, not doing it. He has this great line. He's like, oh, we'd sell if it was the maximally ambitious thing to do, which is obviously.

It's a great line.

Yeah, it's a great line, which is obviously his way of saying no. I'm even going to tell you some of the conversations I've had with him on the phone, which I was like, I can't put this in the podcast because he's like, you know, definitely like friendly UI, but conqueror spirit underneath that friendly UI.

And then I just talked to Zach Dell and I was like, is this the last business? Because what I love about Kareem and Eric from Ramp, I asked them both the question, like, this is our last business. It's not like I'm going to fucking sell this and start another company.

Like this is it. This is the last one. And Zach Dell had the funniest thing because, you know, he wants to build something like you said, relatively young. He's like, I want to work on this for 50 years and go see how far I can take this thing.

And he goes, and do you think I'm doing this for a paycheck? He's like, thinking about my background. I was like, yeah, good point. You're not doing it for a paycheck. So what would be the point of being, you know, selling it again for more money that you're never going to spend anyways?

So I just love this idea. But we never close the loop on your maximum ambition, which is like you guys could be building a trillion dollar company.

I think we can, yeah. If you just think about the power of compounding, and this is one of the reasons that long-term thinking and, you know, not being a seller is so valuable is that it's amazing if you just, you know, kind of can keep getting a little bit better every year, how that can add up to, well, then you're, you know, tripling the value of these businesses every five years.

And if you just keep doing that for 20 years, you know, you're a trillion dollar company. I'm not trying to make that sound easy. That's really hard to keep executing that way over a long period of time, over decades, and, you know, avoid mistakes and continue to retain the best talent, best technology talent in the world, and, you know, deliver the best customer service, customer excellence in the world across these service lines.

That's really hard to do. But if you do it for long enough, you know, the pie here is just extraordinarily big. We're talking about the whole economy, basically. This is like the largest TAM imaginable. And so if we can just keep executing and doing what we're doing for a long enough period of time, I think, you know, the potential is pretty, is staggering.

Well, I have to say, as somebody that's been there, like been able to see this from, you know, almost the very beginning, I remember when the first time Long Lake got name dropped on a podcast and people were like, oh no, like, you know, because it was something relatively stealth, even though you guys were killing and buying everything and doing, you know, doing everything for you to now, you know, I know for a fact and firsthand knowledge that one of the 10 best entrepreneurs in the world, like you got their attention when you did the Amex deal and they're like, hey, what's going on with Long Lake and how do I get involved in this?

So just as a friend and a fan, it's been wonderful to see you, man. And I really appreciate you trusting me with, you know, coming out and telling the history of Long Lake today.

Thank you so much. Honor to be here.

Yep. I hope you enjoyed this episode. Please remember to subscribe wherever you're listening and leave a review. And make sure you listen to my other podcast founders. For almost a decade, I've obsessively read over 400 biographies of history's greatest entrepreneurs, searching for ideas that you can use in your work.

Most of the guests you hear on this show first found me through founders.