Recently, I had the chance to join Kristian Marquez on The Innovators & Investors Podcast. We covered a lot—my vision for Tree & Leaf Partners, how I define “redemptive acquisition,” what I look for in a business, and how my background shaped the path I’m on today.
But underneath all that, the conversation really boiled down to a deeper question: What kind of impact do I want to make through business? This post is my attempt to reflect on that answer more fully.
Table of Contents
The Search for One Business, Not a Portfolio
Let me start with this: I’m not trying to build a fund with 10+ companies. I’m not trying to rack up returns or become the next headline exit. I started Tree & Leaf Partners to find one small business—just one—that I can steward, grow, and lead into its next chapter.
This isn’t the usual model. But I’m not the usual buyer.
I describe myself as a redemptive acquisition entrepreneur. That phrase might sound lofty, but to me, it just means this: I’m stepping into a business not only to grow it—but to do so in a way that’s redemptive for everyone in its ecosystem. Employees. Customers. Suppliers. Communities.
It’s not about disruption. It’s about honoring the story that already exists—then picking up the brush and continuing the painting.
The Three Pillars: Entrepreneurial, Acquisition, Redemptive
Tree & Leaf Partners is grounded in three ideas that guide how I think, operate, and lead:
Entrepreneurial
I’m not just investing in a company from the sidelines. I’m stepping in as CEO. I want to roll up my sleeves, work alongside the team, and be responsible for decisions—not just advise on them.
Acquisition
Rather than start something from scratch, I’m focused on acquiring an existing business. One that’s already solving a real problem and has roots in the community. I don’t see myself as a founder. I see myself as a builder.
Redemptive
Business is a powerful force for good. It can shape people’s daily lives, economic stability, and sense of purpose. I want to be intentional about the kind of culture, leadership, and legacy we build. It’s not just about the bottom line. It’s about harnessing a group of individuals, around a common purpose to drive change in the world.
Why Healthcare and Education?
When Kristian asked what kinds of businesses I’m drawn to, my answer was simple: I look for sectors where purpose is already embedded. That’s why we focus on healthcare and education.
In both spaces, it’s easy to trace the impact. Even if a company is five steps removed from the end user—say, building software for hospitals or managing upskilling programs for schools—we can still ask: Is this making patients’ lives better? Is this helping people grow, learn, and thrive?
I want to acquire a business where the value it provides to the world is visible. Where the “why” is already clear—and my role is to help scale the “how.”
The Right Company (And Founder) Fit
We’re not looking for a rocket ship. We’re looking for resilient growth. Steady. Profitable. Sustainable.
That means companies with:
- $4–8 million in ARR (or >$2M EBITDA)
- 3+ years of operating history
- Evidence of product-market fit
- Low churn and strong retention
- A mission that aligns with real societal needs
But it’s not just about the metrics.
I’m also looking for founders who are ready for their next season. Many of them feel the tension: they know the business has more potential, but they don’t have the time, energy, or desire to keep going. Some want to build again from scratch. Others want to rest. And some just want to know their people are in good hands.
That’s where I come in. Not to erase their work—but to honor it. And build from it.
From IBM to Ownership: My Journey
Before all this, I was at IBM—helping clients design better customer experiences. I loved the problem-solving. But as a consultant, I never had real ownership. I could point to the path, but I couldn’t walk it.
That started to gnaw at me.
So I left consulting, pursued an MBA at Kellogg, and discovered the search fund model. It clicked instantly. This was it: the ability to combine strategy with stewardship. To pair entrepreneurial drive with deep responsibility.
Tree & Leaf Partners was born from that conviction.
The name comes from a Tolkien short story—Leaf by Niggle. It’s about an artist who spends his life trying to paint one perfect leaf. But over time, the leaf becomes a tree, the tree a forest, the forest a world. That story captured how I feel about business: we may start with a small vision, but when cultivated well, it becomes something far more beautiful than we imagined.
What Redemptive Growth Looks Like
So, what does it mean in practice to lead a company redemptively?
It means valuing people over processes.
Tools are great, but culture is king. I want to build environments where people thrive—and feel proud of their work.
It means balancing growth and profit.
I’m not here to slash costs to squeeze out a few more basis points. I care about building something that lasts.
It means embracing transparency and trust.
Whether it’s customers, employees, or investors—our word should carry weight.
It means being thoughtful about AI and tech.
Yes, I use AI to streamline parts of the diligence process. But I’m cautious about overstating its impact. A bigger pipeline doesn’t mean more closed deals. Sometimes, human connection still wins.
The Power of Founder-Led Sales—and Its Limits
One area that comes up often in diligence is sales. Many of the founders we meet are still doing most of the selling themselves. That’s natural—it’s how they got started.
But it’s also a bottleneck.
Part of my role post-acquisition is helping shift the business from founder-led sales to a repeatable, scalable system. That might mean hiring a sales leader, refining the go-to-market strategy, or simply freeing the founder to do what they love most.
Growth shouldn’t depend on one person’s calendar. It should be built into the company’s DNA.
A Word on AI: Useful, Not Magical
Kristian and I also talked about AI—where it helps, and where it doesn’t.
I use it for time-saving tasks: summarizing broker memos, reviewing market overviews, pulling industry comps. That’s useful. But the real value of AI isn’t in replacing people—it’s in amplifying them.
A human SDR still outperforms a bot. A thoughtful conversation still beats an automated follow-up. I’m watching the space evolve—but I’m not betting the house on hype.
Politics, Policy, and Staying Grounded
We briefly touched on political winds—whether that’s the potential elimination of the U.S. Department of Education or shifting healthcare regulations. My take? Policy may change, but the need doesn’t.
People still need care. Kids still need to learn.
As private sector leaders, we have a responsibility to fill the gaps where we can—and advocate for the systems that protect the vulnerable. I want to be part of solutions that don’t just profit, but uplift.
Final Thoughts: What I’m Really After
At the end of the day, I’m looking for more than a transaction. I’m looking for a transition—one that honors the founder’s legacy, empowers the team, and carries the company forward with purpose.
If you’re a founder at a crossroads—exhausted but proud, curious about the future but unsure what’s next—I’d love to hear from you.
Maybe you painted the first leaf. I’d be honored to help grow the tree.
Let’s build something redemptive—together.
Full Transcript
[Kristian]Hello, and welcome to another episode of the Innovators and Investors podcast. I’m your host, Kristian Marquez, founder and CEO of Finstrap Management. Super excited, because with us today, we have Andy Galpin.
Andy is the founder of Tree & Leaf Partners. Andy, welcome to the podcast.
[Andy]Thanks so much, Kristian. It’s a real pleasure to be with you.[Kristian]
Glad to have you. So let’s start with Tree & Leaf Partners. Love to hear about the firm and your focus.[Andy]
Yeah, so Tree & Leaf Partners is a redemptive acquisition fund. I like to describe myself as a redemptive acquisition entrepreneur. And what I mean by that is I’m an entrepreneur because I’m going to be stepping into a business and leading, running, and helping it grow and scale into the future.
I’m an acquisition entrepreneur because I’m looking for an existing company to step into and help build out the future vision of that organization, rather than just start something from scratch. That is a very kind of unique skill set. It’s something that I know I don’t have, but I’m really excited about growing and scaling companies.
So that’s where I really lend value and bring value to a process. And then finally, redemptive, because I like to look at a business as a vehicle to drive change within society. A business is kind of the hub of an ecosystem.
It interacts with not just customers, but suppliers, the community, the employees, and everyone who’s part of that broader ecosystem that helps deliver that value and solve a problem for society. So if we think about it as a broader ecosystem, we can be intentional about how we make that ecosystem better for everyone rather than just better for ourselves.
[Kristian]So a whole bunch of things to unpack. Would love to hear if there are any industries in particular that you’re focused on that you think lend themselves to positive change.[Andy]
Yeah, I think every industry has the potential to drive impact. We focus on two core industries that are already very naturally purpose-driven: the education and the healthcare sector. We do that primarily because we like to do a very simple test to see whether a business is solving a real problem in the world.
And that’s easy to do in those two sectors. In the healthcare space, we’re asking the business, “How does it contribute towards a better outcome to patients?” Even if they’re not directly interacting with patients—they’re four or five steps removed—maybe they’re a technology provider.
I know that’s your background, Kristian. You’re not working directly with the patients, but you are facilitating a process that helps serve better outcomes for patients. And the same thing happens in the education system.
We should be able to connect the work that someone’s doing in that space to helping people gain new skills that help them progress in their career and life. So we like to work in those two sectors. I also like to bring in my background and my expertise—not only in the growth and scaling space but also in the technology space and ecosystem.
I spent six years at IBM helping our clients design more meaningful experiences for their customers and employees. So I like to bring that customer experience strategy lens to the table, and that often lends itself better to more technology-forward companies or software-driven business models.
[Kristian]Okay, and so within the ed and health tech spaces, what’s a profile for a company that you find appealing?[Andy]
Yeah, typical kind of size, that kind of profile, yeah. So we have financial metrics and numeric ways that we evaluate companies, as everyone does. But we also like to look at the culture and the people aspect of an organization as well.
On the software side, we look at companies with $4–8 million in annual recurring revenue. We look for them to be past that initial product-market fit stage. I would describe that as kind of the zero-to-one stage of a founder—someone who’s identified a real problem in the world and has built a solution and validated that it’s actually solving a problem.
And it’s now ready to scale and increase the impact that it’s having. So we pick it up when it’s ready to scale or has just started that journey, rather than earlier in the process. Often, they’re not as fast-growing as VC-backed companies because we’re not in VC ourselves.
We look for more steady, consistent growth in a market that has a lot of potential to grow and build out. And we look for a founder that either wants to focus on building the product rather than running the company or is interested in going back to that zero-to-one stage and has a new idea they’re ready and excited to pursue.
[Kristian]Oh boy, a whole bunch more to unpack. So notwithstanding annual recurring revenue, I’d love to hear what other metrics you focus on.[Andy]
Yeah, so we look at a lot of the typical metrics that a VC firm would look at. We look at customer acquisition cost, lifetime value of customers, how long it takes to run that cycle, and the team within the organization. The big challenge I find with some of the startups that we look at—particularly early-stage—is they haven’t built the infrastructure that allows the company to emerge as a business versus just a hobby.
They can be driving a very high level of revenue, but if there are three people in the organization and two of them want to leave when the acquisition closes, they haven’t really built a company that’s going to be sustainable in the long term. So we’ll do a deep dive into the organization—how it’s structured, any gaps in that space as well. We also look at profitability, which is a little different from VCs.
I know we’ve kind of turned the tide a bit in the VC world where profitability has become more important. We don’t invest in companies that haven’t broken even or can’t demonstrate a clear path to profitable growth. We look for 10–20% EBITDA margins to complement some level of growth.
And we evaluate that based on how fast it’s growing and whether all that money is being reinvested in the business, or whether it can be balanced between profitability and growth. That’s always the tension that founders are wrestling with—how fast to grow versus whether to bank some profits and return value to investors.
[Kristian]Okay. And then as far as yardsticks, I’m really curious to hear your perspective on how you define product-market fit. A lot of different definitions out there—you could just look at revenue and growth—but how do you look at it?[Andy]
Yeah, we probably look at it in really simplistic terms. We look at revenue and how fast it’s growing. Then we look at churn. If revenue is growing fast and we’re bringing on new customers, that’s great—it suggests we’ve found a good problem to solve.
But if after a year, all the customers are churning, it probably suggests we found the right problem, but not the right solution. So when companies are growing and not losing a lot of customers at the end of their contracts, that tells us they’ve hit the right balance and are ready to scale.
[Kristian]And so retention is one thing, new sales are another. One of the biggest challenges I find as founders look to scale is sustaining meaningful growth at scale. What are your expectations?
Are you prepared to revamp their sales and marketing efforts? Some PE firms like Vista have their own playbooks. How do you think about growing topline?
[Andy]Yeah, it starts with understanding what’s working and what’s not. If we’re buying something that’s already growing fast, we prefer not to break what’s working. But we’ll look at whether the current structure is sustainable long-term.
A lot of that centers around the founder—how involved they are in sales and whether they’ve become a bottleneck. As a company grows, the founder’s capacity becomes limited. So we want to put infrastructure and people around them to allow them to step out of that role—whether they’re staying or transitioning out.
We want to understand what the “steady state” looks like and what needs to be tweaked to help the company go to market more effectively.
[Kristian]It’s interesting—this idea of founder-led sales. Many founders don’t realize how important it is to start building a team around them for growth. Obviously, there’s been a big emphasis on artificial intelligence since ChatGPT launched nearly two years ago. To what extent is AI factoring into your acquisition plans?[Andy]
We use it to speed up administrative parts of the process—analyzing industry info or reviewing initial materials from brokers or business owners. But AI also impacts how a company operates, even if it doesn’t impact the product itself.
We’re still early in the hype cycle. There’s lots of promise, but most of the value so far is in automating mundane tasks—like writing notes or capturing leads from sales calls.
I read a CEO recently saying they’ve never had a bigger pipeline thanks to AI, but also never closed fewer deals. So it’s unclear where AI truly delivers value. It’s great for reach, but it’s not clear that it converts like a human SDR would. Still, for internal operations, there’s definitely some value.
[Kristian]So it sounds like monetizing AI is still the exception, not the rule?[Andy]
I would say so, yeah. A lot of companies we see just integrate with OpenAI’s API so they can say they use AI. It’s more of a marketing checkbox.
That’s partly because we don’t look at fast-growing AI unicorns. These companies focus more on core functionality, and may not have internal AI or data science talent to really innovate in that space.
[Kristian]Got it. Makes sense. I agree—we’re still in the early innings. Let’s change gears a bit. How did you arrive at the point of founding Tree & Leaf? And how did you raise the capital to make your acquisition?[Andy]
I started at IBM, as I mentioned. I loved solving client problems, but as an advisor, I lacked ownership and accountability. I could make great recommendations, but unless the client acted, nothing changed.
So I left consulting and did an MBA at Kellogg, which helped me validate where I added value and what gave me energy. I discovered the search fund model—raising capital to acquire and operate one business long-term.
That clicked for me. It combined the problem-solving of consulting with the ownership I craved. And I became really passionate about creating workplaces where people enjoy using their gifts to add value to the world.
[Kristian]And if you don’t mind sharing—how did those investor conversations go? Did you raise from limited partners?[Andy]
Yeah, the search ecosystem has been around 30–40 years, so there’s an investor community that knows the model. One of my investors did the same thing 15 years ago—bought a software company in Canada, exited recently, and now backs searchers like me.
Many of them have a redemptive or conscious investing lens. They want to support businesses that solve meaningful problems. So I had great conversations—but I still had to prove I could find and run a company.
[Kristian]Fantastic. Back to ed tech and health tech—this is late Q4 2024. Let’s talk politics for a moment. First, the potential elimination of the Department of Education. Any thoughts on how that could affect ed tech investing?[Andy]
We’ll see if anything actually happens. But the private market is ready to fill the gap. The challenge without government oversight is ensuring consistent educational standards across the country.
We’ll need to think carefully as a sector about how to maintain those standards and ensure children get the education they need to thrive in the future. But yes—it opens up opportunity for the private sector to do more.
[Kristian]And on the healthcare front—rumors of further privatization from Republicans. How might that affect how you evaluate companies?[Andy]
It would definitely shift how we view revenue sources—particularly companies relying on Medicare or Medicaid. The risk is that those most in need get the least care.
We’d have to find ways to ensure a baseline level of service while also acknowledging the strengths of a private system. It’s hard to know how much will actually change—four years isn’t long in government terms. We’ll know more by the midterms.
[Kristian]Yeah, I agree—the train has left the station no matter the political winds. Andy, I wish you the best in finding a company ready to create positive change. If any founders listening want to reach out, how can they find you?[Andy]
You can find us at treeleafpartners.com or on LinkedIn. I’m Andy D. Galpin—search “redemptive acquisition entrepreneur.” I love talking about organizational change, building culture, and using storytelling to lead.[Kristian]
There you go. Andy, thank you so much. Really appreciate your time and insights—and wishing you the best of luck.[Andy]
Thanks so much, Kristian. I appreciate your time.[Kristian]
My pleasure. And that’s another episode of the Innovators and Investors podcast. Thank you all for listening.
