Justin Ishbia

There's an opportunity where

They want to stay in a location for the long term, but the underlying real estate is owned by the veterinarian, and they oftentimes don't want to invest in that.

So how do we figure out a dynamic where we know the location is great, the underlying balance sheet of the portfolio company is great, we have an unfair advantage of knowledge, and specific knowledge of the location

And then it helps my base business because I can do things to help the base business to potentially lower the rent in exchange for a longer term on the lease.

So the lease becomes more valuable in the market ecosystem.

You aggregate 100 of those together, it becomes a valuable asset.

It becomes more valuable to the veterinary company by having a lower cost lease or more capital for tenant improvements.

So it's a win-win-win scenario.

The portfolio company wins because they have more EBITDA or more capital to spend.

The real estate fund wins because there's an opportunity to elongate the lease in exchange for some things that creates a better value over time.

And our investors win by low cost capital will work in a more efficient way.

So all parts of that makes sense to us.

So to summarize, I would say we will only extend products that short capital.

Two things are true.

We have unfair advantage.

It helps my base business.

And I know having a real estate fund helped my base business on the acquisition and also the underlying portfolio companies.

There's a current conflict.

The conflict is not in the buy, though.

The conflict is in the lease.