Painting a Better Future with Purpose: Let’s Talk About It Podcast

And at Let’s Talk About It, we’re going to have conversations with all kinds of leaders and visionaries. Can’t wait to have you as one of our podcast guests, too. If you listen to the end, we’ll tell you how you can be a guest on a future show.

Thanks for joining us.

Hello, welcome back to another episode of Let’s Talk About It, conversations with industry shapers. Today, we have Andy Galpin on the show with Tree and Leaf Partners.

Andy, welcome to the show.

Tell us about Tree and Leaf Partners. How are you disrupting? And we’ll just begin.

I’m looking for a small business to acquire and then run for the foreseeable future. But with a mindset of redemption in mind, that business is more than just making profits. It’s about driving change, both in culture and society.

So we like to think about business as a broader conscious effort of engaging the world. And part of leading that and being intentional about that is thinking about kind of the products and services you offer, how you engage and relate and connect with both your employees, your suppliers, your customers and all the third parties that are involved in making what you do happen. And I know from my experience that I am really gifted at scaling things, but I’m not so good at building things from scratch.

And I think some people can do both, but not everyone can. And I know I very much sit in that latter half of the table. So I’m excited about finding someone who’s built something really awesome, has a big vision for that business going forward, but knows that we’re all human beings.

We only live so long. So at some point in time, if we built a sustainable business, we’ll have to hand that over to someone else. And we want to look for people who carry our culture, our values and can build out the vision that we have in mind for that business going forward.

So that’s why I formed Tree and Leaf Partners. I named it after a collection of short stories that a British author wrote. You may be familiar with Tolkien and his Lord of the Rings trilogy, but he wrote this wonderful little short story about a painter just after he finished the trilogy or just after he finished the Hobbit before he wrote the trilogy.

And it actually took him 30 years to finish the Lord of the Rings trilogy after he’d written the Hobbit. So you can imagine his mindset going into this short story. He has this vision of this world and wants to capture it in just three short books.

And he knows he’s only got so long on this earth to do that. So he writes this wonderful little story about a painter who has that vision that’s much bigger than himself and doesn’t have time to finish that in his lifetime. And that really resonated with me and the journey that I’m going on and the painter I’m looking for, who’s looking for someone else to share that paintbrush with so I can keep building out the vision that they’ve crafted.

Let me ask a qualifying question. So do you seek to aggregate different pieces or is there a specific vertical or industry that you’re hyper focused on?

So working on both the customer and employee experience, and then using large enterprise technology to make that a reality rather than leaving it as something we think is a great idea in practice. But we need to make it practical and make it real so it actually delivers value to people’s lives and solves problems for people. So I did that for six years.

That’s the experience that I bring into the table. So I’m focused on software companies and technology service companies because that lends really well to that background. And specifically in the health care and education sectors are where I spend most of my time.

And it’s really important for me that the business understands why it exists and the problem it’s solving for society. And you can find that in any industry. It’s just a little bit of a cheat to focus on health care and education because they’re so purpose driven by their nature.

Interesting. I finished 12 years in 2019. I aged, not aged off, but gotten off the board, right?

Tenured off the board. And one of our giant initiatives pre-COVID, hence the 2019 date, was how do we start curating all this content from all of our teachers so that we can expand this to an online? This is small Christian schools, right?

But there are lots of homeschooled people all over the U.S. who need, you know, the parents might not be really good at chemistry or history. And how do we give them those? And that’s something that’s scalable, right?

As a software as a service platform or a subscription platform. And the same for health care, right? I mean, from telemedicine to a dozen other ways to break that Byzantine incestuous mess that is American health care, right?

That’s fantastic. Tell us how you came up with the idea. So you’re at IBM and you’re like, I know my superpower other than my voice.

And how do I how do I leverage it? So how’s that journey?

I really loved solving problems using technology. I love learning a lot every single day. And I loved working in and through and with people.

And that’s what I loved. But as a consultant, as a third party advisor coming in, you can give advice until you’re blue in the face. And ultimately, it’s up to the client on whether they one, accept that advice.

And two, even if they agree with it, whether they actually do anything about that and drive some change. So for me, I was getting a little restless with the lack of ownership and accountability that I could have to really drive change in these organizations and solve the problems that I thought were the most meaningful for both customers and employees working in those organizations. So that was my kind of springboard point to go, let’s do something different.

But I needed to work out what that different thing was. So for me, I came across the concept of an MBA, the Masters of Business Administration in Europe, where we don’t really care too much about the MBA, sorry, Americans. But I love the idea of rounding out that skill set and making sure I had a good foundation in business principles.

So I could lead in the best way I knew I could and had those resources available. So that’s what brought me across the pond. I spent two years at Kellogg School of Management, learning more about myself and ultimately understanding how best to lead an organization.

And that’s where I got introduced to the idea of what I’m doing now, a concept known as entrepreneurship through acquisition. So it’s a great fit for those entrepreneurs that know I’m not a zero to one founder, but I’m that one to 100 person who’s ready to get their hands dirty and help scale something that exists and is really exciting.

It takes on average two years to go through that process. We’ve come close on a few, but sometimes it doesn’t always work out as you go through these processes.

But businesses that I acquired emerged together where the culture was different. Abysmal failure and businesses that were humming along that we hired somebody quickly because we needed a body. One bad hire can destroy like a cancer through your entire organization.

Right. And culture is just so important. Yeah, agreed.

And so your due diligence, even if it takes a year or two, it’s got to be right because it’s yeah.

But equally, this is my foreseeable future. I’m going to be investing the rest of my life into building this organization and making it a great place for everyone to come to work in. And I need to make sure that’s right for me and a good fit for my skill set.

So I’m adding the value I need to in the business.

But if they’re looking to slowly take some chips off the table the next three to five to seven years, what’s your ideal target?

So for them, they’re not looking to leave the business, but they’re really excited about giving that administrative side to someone else. You run the company, Andy, and I’ll go back to focus on building the product that I love and I’ve invested so much time and energy. And that’s often a really good fit if someone’s ready for that type of transaction, because we can take off all the things that they don’t enjoy from their plate and focus on growing the business at a holistic level.

And they can be laser. Equally, if they’re ready to transition out and they’re looking to spend more time with the grandkids or they’re just feeling burnt out because startup life can be hard and running a business is hard. That’s OK as well, as long as they’re willing to work with us through a transition period, because I want to learn as much as I can from you as a business owner before we take over the reins and run that ourselves.

Having bought 40 different companies over the years, we never really cash someone out all the way, right? You have to have some skin in the game. And so your ideal target market is maybe looking at a one to five year window.

Again, if the culture’s right and everything’s right through a share purchase or a common trust or kind of what’s your acquisition model?

And so we don’t like using earn outs, but we’ll often use something called a seller note. So there’ll be an element of borrowing some of that kind of capital from the owner and then paying back that over a number of years, which often gives us that kind of five to seven year timeline. And then if the owner’s young and they want to stay invested in the business and be part of the growth of the business, then we’re very encouraging of rolling equity and being part of growing that business and seeing the value be created over time.

All right. So let’s pivot back to the Andy story. Prior to IBM, you cross upon growing up in the wonderful country that made so much of the world freer and gave so much to the world, especially in my love of of insurance.

Right. Which, although the Chinese may have invented the concept of risk transfer, the British developed the concept of pay a premium for a thing at a little coffee shop named Lloyd’s on the docks. That’s fantastic.

Before IBM, what’s what’s your dream? What do you think you want to do before you ended there?

So that element of my work is still present because I get to spend a lot of time investing in developing people. It’s just not in front of a television cameras.

It’s Andy D. Galpin and I’m based in Dallas.

We’ll put your contact information in the show notes and I’m going to let them know that we have to get you back on it another year. See if you found that company. You’re still looking to watch.

So thank you so much.

That’s podcast.jeffarnold.com. Two more quick ask for you, please. If you got something out of this interview, please share it and tag us on social media.

I love seeing posts and guest suggestions. And then as a quick reminder, we’re always putting out new episodes and content to make sure you don’t miss any. I would say please go ahead and subscribe to us on all your favorite social media channels.

Thanks again for listening. We’ll see you next time.