Jim McCann

Well, you know, when everyone's nervous, if you don't have a very clear line of sight to profitability, if you can get capital and there's a real question as to whether or not you can, you're going to be paying 25, 30% cost of capital. And boy, you better have one heck of a business because how many companies, how many businesses have margins enough to justify that kind of cost of capital?

Well, you know, when everyone's nervous, if you don't have a very clear line of sight to profitability, if you can get capital and there's a real question as to whether or not you can, you're going to be paying 25, 30% cost of capital. And boy, you better have one heck of a business because how many companies, how many businesses have margins enough to justify that kind of cost of capital?

I don't know many.

I don't know many.

I don't know many.

Well, not the traction, get the capital. How do you get the capital? How do you get people to say, okay, I'm going to invest in this because capital is tight.

Well, not the traction, get the capital. How do you get the capital? How do you get people to say, okay, I'm going to invest in this because capital is tight.

Well, not the traction, get the capital. How do you get the capital? How do you get people to say, okay, I'm going to invest in this because capital is tight.

And you see in the private equity community, for example, when you have a shop that has both a credit side to it and an equity side to it, well, the private equity guys are saying, well, I work my tail off and I commit capital to these businesses for 30%. four, five, six, seven years. And I'm targeting 14, 15, 16, 17% IRRs, internal rates of return.

And you see in the private equity community, for example, when you have a shop that has both a credit side to it and an equity side to it, well, the private equity guys are saying, well, I work my tail off and I commit capital to these businesses for 30%. four, five, six, seven years. And I'm targeting 14, 15, 16, 17% IRRs, internal rates of return.

And you see in the private equity community, for example, when you have a shop that has both a credit side to it and an equity side to it, well, the private equity guys are saying, well, I work my tail off and I commit capital to these businesses for 30%. four, five, six, seven years. And I'm targeting 14, 15, 16, 17% IRRs, internal rates of return.

Well, I can do it through the credit side of the shop and get 12%, 13%, 14%, 15% be at the top of the cap table and have a lot less risk and have my money out sooner. So you're seeing when capital gets tight, it goes to the credit markets where they're more protected and they get almost as good a return without the risk of being in equity.

Well, I can do it through the credit side of the shop and get 12%, 13%, 14%, 15% be at the top of the cap table and have a lot less risk and have my money out sooner. So you're seeing when capital gets tight, it goes to the credit markets where they're more protected and they get almost as good a return without the risk of being in equity.

Well, I can do it through the credit side of the shop and get 12%, 13%, 14%, 15% be at the top of the cap table and have a lot less risk and have my money out sooner. So you're seeing when capital gets tight, it goes to the credit markets where they're more protected and they get almost as good a return without the risk of being in equity.

A lot more expensive.

A lot more expensive.

A lot more expensive.

Some will go away. Some will be acquired. Maybe some will muddle through. I'm not sure how. But you have two things working. Cost of your capital has gone through the roof. It's triple, quadruple what it was a year ago. So cost of capital. And your cost of customer acquisition has exploded. It's what people call CAC, C-A-C, cost of acquisition of a customer.

Some will go away. Some will be acquired. Maybe some will muddle through. I'm not sure how. But you have two things working. Cost of your capital has gone through the roof. It's triple, quadruple what it was a year ago. So cost of capital. And your cost of customer acquisition has exploded. It's what people call CAC, C-A-C, cost of acquisition of a customer.

Some will go away. Some will be acquired. Maybe some will muddle through. I'm not sure how. But you have two things working. Cost of your capital has gone through the roof. It's triple, quadruple what it was a year ago. So cost of capital. And your cost of customer acquisition has exploded. It's what people call CAC, C-A-C, cost of acquisition of a customer.