This episode is going to be slightly different because I’m going to talk a lot. Why? It’s because it’s an interview I had with my co-founder, Ayo Disu, at Octillion, which is our platform company. We acquire and grow clean food and beverage brands or clean consumer-packaged good brands and we do that on Octillion, which is our platform company. Ayo and I have been working for well over a year. This conversation is a reflection on 2022. We made our first acquisition of a clean food brand called Lean Caffeine, it’s more than a coffee brand, it’s a clean food supplement brand and a clean coffee brand. It’s been an exciting year operating that brand and scaling it and growing it. It’s different.

In this episode, you’re going to learn about our conversation about what the process was like to acquire this brand, our reflections on the deal and reflections on operating the business thus far, and our unique approach to leaning on people, processes, and systems to run this brand. We are on a mission to acquire and build a platform company with twenty brands in there. It’s a lot of work and also a lot of organization. This is also an organizational efficiency project. Enjoy this episode. I always enjoy speaking to Ayo. Enjoy this one and I shall catch you on the other side. Cheers. Thanks.

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Ayo, how’s it going?

Not too bad. How are you?

I’m pretty good. First of all, for people who don’t know who you are, you are my business partner and Co-founder at Octillion Capital Partners or just Octillion. You were here in March or May 2022. How are you? How’s it going?

It’s all good. I’m busy as you know but it’s been an interesting year filled with a lot of learning. Overall, it’s been a strong year for us in terms of the development of the company and also ourselves. I’m excited for 2023 and the future of the company and our companies in the future. It’s been a great year and that’s what we’re here to talk about.

I echo your sentiment. A huge milestone this year. In our last conversation when you were on the pod, we hadn’t made an acquisition at the time. We were 60% or 70% in on our value structure and our mission at the time and we doubled down. To rehash, the last time, we spoke on three core values, one was sustainability, another was that omnichannel footprint, and another was inclusion. We felt there was something missing. We hadn’t quite dialed in. Do you want to speak about that in terms of what our mission has evolved to?

Funny enough, I was speaking to someone about this and it was about having clear criteria is extremely important. Taking that into what we are doing now at Octillion, usually, the best place to start is at home. For us, when we looked into our own personal lives, you from your own health angle and myself from my own decision angle in terms of my philosophy, it was evident. Also, looking at macro trends. It was evident that we needed to focus on something that was more than inclusion and sustainability.

The omnichannel footprint is a staple for any consumer brand. We essentially said, “What is the problem that we’re trying to solve on a macro level?” What the research led us to is the food epidemic as well as toxic skincare practices. That has now led us onto the path that we are on now in which our refined mission is that we’re looking to acquire clean consumer brands in the food and beverage space and the beauty space.

What that encapsulates is clean from an ingredient standpoint, meaning that they have transparency in the ingredients, natural, and organic. From a food standpoint, it means no carbs, eco, high protein, and it’s good for you. That is the refined statement. We’re looking to acquire and build a clean consumer brand conglomerate on those tenants. That is our mission. I don’t know if you have any other things to add to that as well.

Stepping back to the diversity omnichannel and sustainability play, that’s the fundamental DNA of any impact company but it would vary. Some impact companies would skew or over-index on inclusion, for instance. Others might over-index on sustainability and be detailed about their sustainability credentials.

At least every modern company should have those three tenants. For an enterprise organization, that’s pretty much quite rigid. That added flexibility takes a bit of effort. It’s like an elephant trying to move through a pathway or a limited gate. It’s not that the elephant won’t be able to go through but it will take a bit of effort and orchestration in moving. We’re more agile.

From a personal perspective, cholesterol and fighting out fats. I personally don’t put on weight. Fitness has been a core in my life.  One of the things that have weighed me down personally has been diet. I’ve endeavored to educate myself from a dietary perspective. Besides diets, fitness had been locked down, and habits.

What I’ve come to the realization is that we’re made to think that we have food choices when we go into the grocery aisles but we don’t. Most of the foods we consume and most of the mainstream foods we consume while growing up have been controlled by a few firms that optimize their products for repeat purchases. They want to create habits, which is essential.

They put added ingredients that may or may not be healthy or detrimental to the health of consumers. They get us to buy cereal, ketchup, or whatever over and over again because we are accustomed to that taste. Personally, Coca-Cola for instance, my palate for Coca-Cola is bland. I just feel it’s Coca-Cola.

For my wife, she’ll know if it’s the normal sugar Coca-Cola. With a blind taste, she’ll know whether it’s diet or whether it’s Coke Zero. She has a choice, she knows what she likes. A lot of consumers are like that in the sense that they habitually buy the same old stuff. Many years ago, having had a health scare, one of the ways I liberated myself was going on a low-inflammation diet at the time, and that changed my life. Fitness and a low-inflammation diet changed my mind.

When we saw this target, which is called Lean Caffeine, I’m not sure if over our last conversation, we were in talks with the founder. When we spoke with the founder and we heard the founder’s story, we looked through their portfolio of products from a due diligence standpoint and it aligned with both our values. It’s like a triad where the founder’s values, whose name is Jamie, your values, and my values all came in. The numbers did make sense. It was incredible. Do you have any thoughts on that?

The funny thing about this is that when you don’t have clear criteria, and this was us going back to what we were doing when we were looking at different deals, one is that’s not the best use of your time and our time because we didn’t follow through on most of those deals and it was a lot of work and back and forth and mental space.

Also, the other thing is the framework that you used to assess some of those deals, which, for me, is one of the most important things. Because we have this clarity and focus, when we’re looking at new opportunities, we’re able to be quicker because we know that this is what we’re looking for. If we see a deal, it’s not for us. It’s going out the door. It’s going to someone else in our network or we’re saying, “Sorry, it’s not for us.” We’re passing it on. It’s giving us that mental space to, more or less, think, refine our processes, and then pick the winners.

Going back to Lean Caffeine, when we came across Lean Caffeine, we honed down on our values and our direction. At the time, because we didn’t know what we wanted, we would’ve missed out on that opportunity. For me, Lean Caffeine was our deal and it was meant for us. It was written in the stars. When we then honed down on our mission, we went back to Atilla, who was the broker on this deal, a good guy from Switzerland, Geneva. We went back to him and asked him, “This is an opportunity to market.” He was like, “Yeah.” We had a conversation with Jamie. We spoke to him and we got on.

As you alluded to earlier, Lean Caffeine’s mission not only match our personal philosophy but also matched Octillion’s direction. It’s our genesis. It’s the company that we would look back at and say, “This is where we started.” More or less, it sets us up for a future potential acquisition within that space and it’s giving us a working platform for future acquisitions that we’re making. In hindsight, if you think about it, it’s good that we didn’t first hone down on criteria because it comes through reiteration and refinement as opposed to finding it in that one goal. It doesn’t happen that way. It’s too perfect.

With this, we’ve taken our scars but those scars are meaningful. It means that in the future, we know exactly where we want to play. Lean Caffeine is a fantastic start for us and we’re looking for twenty Lean Caffeines at different stages but still underpinning those core values of clean, healthy, and good for you more or less.

To clarify along with the mission when you said that we’re a conglomerate, I like how specific you were and how persistent the statement is from the get-go, which is like, “We’re not Amazon aggregators.” You’d always said it. I brushed you up, of course, we are not. I thought, “No, we’re not.” With the clarity of the focus on ethical clean brands that we can ingest into our bodies or apply on our bodies, it set us up to be conglomerates. It’s in the sense that we’re looking to acquire twenty eCommerce-first food and beverage clean skincare brands over the next decade and operate them to substantial sizes portfolio.

That clarity is important in terms of the Amazon aggregator model not being that. For the readers, I would like you to break down your key learnings from the acquisition journey and from acquiring this company. Before you do that, I want to make a point. I remember when we were speaking to a potential investor and he was like, “What are you guys fighting for? What problem are you solving? What impact are you making?” It took us back to the drawing board to reflect and that paved the way.

I do see Octillion as an impact mission-driven company. We’re not about survival. It’s not about making money. Money will come. It’s the change we’re making that will create new value that will be rewarded long term. Going back to reflecting on the entire process of speaking to Atilla and having conversations with Jamie, we had our financial criteria and it passed with flying colors in terms of the financial due diligence metrics. We then started to look at other things in the stack. Do you want to speak about the other aspects we looked at and a reflection on key moments of the acquisition process?

It’s a fantastic point and I could not agree more with you on who we are at Octillion. I completely agree with you. If you create value, money will come. Looking back here on a few reflections, I want to keep it sweet and sharp. I’ve written down some stuff as you were thinking to summarize. The three key things were preparation, process, and expertise. Preparation is the first thing I want to talk about.

From an acquisition standpoint, we were prepared. We had our processes from the get-go, from when we first issued the LOI all the way down to collecting and analyzing the data. It was fairly prepared. We had those systems set up before we needed them. The second thing is expertise. I remember when I was out of the office and then you send me a voice note saying, “Here’s the due diligence of LC moving into the Amazon Seller Central. We need to bring in an expert to give us visibility.”

We then brought an expert and he gave us a lot of visibility. He gave us a lot of learnings that we then took, documented, wrote it down, thought about it, and the right questions for Jamie and also with the other partners that we’re on this deal with us from a financing perspective. Also, from an operational perspective, you can see they appreciated that level of thoroughness.

It’s the same thing I was speaking to somebody about. There are some things that you can do yourself but it doesn’t necessarily mean you should do them yourself and that’s where the expertise comes in. The fact that we brought in this person to give us this picture of what this business is and he gave us an unbiased opinion. Even in your due diligence, there’s a chance for a little bit of bias to slip in because you wanted to go through it.

It’s the expertise. We’re very prepared and it’s good to be prepared. We’ve taken a lot of lessons from our first acquisition because it was smooth but our next one will be even smoother. Expertise, outsourcing, and capabilities are what we’re looking for. We didn’t just bring on anyone, we brought in something that we felt we could mold and work with long-term. We’re always optimizing for long-term partnerships with key relevant players.

The final part was on processes. Maybe now I’m speaking to more of a post-acquisition outlook. With what we’ve done, one is the introduction of an acquisition integration specialist that has helped us extract the business from Jamie’s head into a working document that we have visibility over and then we can use to now make informed decisions on current processes that are working and are not working and future processes. That is a game-changer.

For me, especially having that oversight of the business, how it’s working, and how all these nuts and bolts come into play, it’s giving us a good starting point to implement our growth plans. Those, for me, are the three key things, being prepared, having experts in the right area, and establishing processes. One is from knowing what processes are in place already and then using that as a stepping stone to implement new processes that take the company from where it is now to where we want it to be in the future.

It’s having that plan in place, mapping out the journey, and taking that journey with the right people. People, processes, and systems are something we’ve talked about. The first book I gifted you was The E Myth. It’s over and over again. It’s down to people, processes, and systems. My next mind-blowing book is Who Not How by Dan Sullivan. It’s another great book. That touches on the people and expertise piece you’re talking about.

A lot of the time, we’re consumed by ego. At least personally speaking from a consultant standpoint, you’re paged to be the smartest person in the room. If you’re not, you’ve not been in the room for a long time. That’s a word of consultancy because you lose your value. Your value is your knowledge. As a consultant, it’s what you bring to the table.

If you are charged with execution, if it goes wrong a few times, it might be okay depending on the culture of the company. If it keeps going wrong, you’ll be out. It’s transitioning from that consultant team mindset to a leader whereby you have teams, you have people, you have departments, and you have systems. You have people you trust. You have to learn to trust.

I was listening to something and he’s the founder of a company called GoFit and they’re based out in California. This business is about $20 million or $30 million in revenue, it’s profitable and all. It’s an apparel business. He’s like, “I used to give 100% in everything.” He realized that as the company is scaling, he needs to hire people who cannot give 100%. Even if they give 70%, it’s better than him stretching himself 100% and having nothing left. He’s like, “If you scale the 70% across the board, you’re building out a scalable system.”

I do agree with you on the people piece, the processes, the acquisition, and the process extraction experts we brought on board. The business as it is is sellable because should anybody come into the business, we know our numbers. It’s not to say that we’re selling. We’re not for sale, not anytime soon. We’re ready. It goes back to your point about being prepared. We should always be in preparation mode and always ready.

You’re a process guy. You are diligent. You’re process-oriented. You take your time to observe. You’re a listener, which is phenomenal. Yes, I recall your point about me looking at Amazon Seller Central and saying that I’m probably not the best person. The key superpower you and I have is the ability to ask the right questions. What do you think? What do you say to that?

Before I even answer that question, it goes back. You were talking about ego and I’m guessing managing your ego or at least being aware of the ego. One thing here is that we leave ego at the door. It’s not about your ego. Especially in our roles as this is growing, we’re servants to our people, to our customers, and to our stakeholders.

The point that you made is a fantastic point. You realize, “I’m probably not the best guy for this,” but you didn’t let your ego get in the way to say, “I’m fairly smart and I can figure it out.” You saw the bigger picture. You’re like, “If you want to do this properly, we need to bring in someone that can at least do a lot of the technical bits.” You then come in and ask the right questions and use the data that you’ve got and make informed decisions.

That’s an excellent point and the fact that you’re even aware of that is why we partner well together. It’s rare. To your point on questions, that’s something that you do well, which is you’re able to digest a lot of information. It comes from the most unassuming place, which is your podcast. You ask questions on your podcast with your guest. You’re the interviewer so I’m guessing for your podcast preparation, it’s like, “I’m going to do a little bit of research on this guy.” It’s probing.

I completely agree with you, if you don’t ask the right questions, how are you going to find the right information that would then allow you to make the right decision? There are different layers of questions, like, “Can I ask a basic question and get a basic answer to make a basic decision?” Ask a top-level question that gives me top-level information and I can make a top-level decision, hopefully. I completely agree with you in that respect, for sure.

I’ve definitely changed. We’ve been operating this business since about September 2022 when we closed the deal. Do you want to break down the structure of the deal? A top-level structure. There was a press release announcement where we broke the structure. We were in the private equity magazine called The Deal where we made the announcement. Do you want to break that down as an M&A?

Sure, I will break it down. I’m not going into too much detail. More or less, how it worked was that we did a share purchase agreement so we bought the entire company. It’s a UK-based business. We have a SPA as we refer to it. Within that, it was an upfront payment to Jamie of around 55% which we paid him after closing the deal so that he got some capital in his pocket and extracted some value out of the company, which was financed a bit from our investors/lenders.

Also, a bit of equity finance as well. The remaining is via earnout. Jamie’s on an earnout for us for at least the next 28 to 32 months, which, for me, is like any deal we do will have that earnout, a little bit of financing to ensure that the seller is aligned with us. We’ve structured it in a way in which we don’t have any interest payments on the seller’s notes. It’s a straight payment schedule on specific dates. In essence, that’s the top level of the deal structure. It will vary deal by deal for future acquisitions.

The nice thing about this was it didn’t have facilities, although it’s in our roadmap for us to own our facilities. It was a great business. It is still growing in all of the mess at a macroeconomic level with the inflation and the state of the economy in Britain in particular. It is still growing with those headwinds and that’s because the portfolio of products or the product offering of the business serves a meaningful purpose and function in the lives of its customer base. They buy it for a purpose. It’s both, more or less.

I wanted to reflect on my perspective as a consultant versus an operator. I wanted to reflect on that and I would say that I am listening a lot more. I’m more patient. I’ve had to understand myself a lot more so I can understand people. I don’t think you can understand people until you understand yourself. One thing I’ve started to hone in on is meditation. I meditate a minimum of 30 minutes a day.

I can meditate for 45 minutes straight, I could even do an hour. I haven’t tried an hour yet. I’ve tried 45 minutes and it was a breeze. I didn’t want it to even stop. On a daily basis, due to my commitment, I’m a family man. We have three kids. We’re a family of five. I put a minimum of 30 minutes. Sometimes I would do 30 minutes before sleep and 30 minutes upon waking up. Being in the company of yourself reveals so much to you. I’ve done it without fail for at least 90 days. The one I do not miss is the morning one. That’s given me perspective. It’s probably made me quieter to listen. As an operator, you really listen.

That’s been my key takeaway, being patient. That delegation piece and trust in people competent to take off the burden on you. Imagine the outputs we have on process mapping the entire business. Imagine if you try to do it yourself, I tried to take a stab at it, how luck lustered It would’ve been. We’re not specialists. It’s been incredible. Everything is down to your resources. At certain points in time, you may be able to afford certain experts.

As you evolve, the game will change with the ecosystem around you. The question I keep asking myself is, how do you maximize the resources around you and empower them so they feel valued? Those are my reflections from an operator standpoint. For me, also, it’s about the data. The people are important and understanding the people is the more fluid left-brain side of operations.

There are also the numbers and seeing patterns and understanding, what SKUs need a variation, for instance, or what’s our product launch roadmap going to look like. Why is this just peak? Is there any trend? There are a lot of patterns. You’re looking at data and patterns so you can drive or ask more probing questions or make key decisions or give key instructions to move it in the direction you need. It’s like a dashboard in a car, on a boat, or on an airplane. You need it. You can’t fly blind or drive blind. Your thoughts?

It’s interesting about the meditation bit. I’ve heard a lot of people talk about meditation and how they use it. It always seems to have a good impact on your mind. Meditation is a little about regulation, regulating your body, regulating your mind, and regulating your thoughts. I don’t meditate. I’m more of a journal man.

As you know, my philosophy about stoicism and all of that. It’s a fantastic tool for like self-mastery and developing perseverance. It’s a tool that you can use to live a great life as opposed to some esoteric field of academic inquiry. One of the reasons why I like socialism and is helping me here is because socialism is for doers. Both of us are doers. We’ll talk and strategize but after we have our call, there’s execution, and that’s where the art happens in the execution.

For me, a big takeaway on being a leader or at least in maybe a leadership position is more around problem-solving and also developing my mind. For me, those two things are critical. Problem-solving because of everything that happens on a day-to-day basis just knowing. The two go in sync and that if I develop my mind, I’m able to solve problems quicker and better. Also, I’m not doing it by myself. I’m working collaboratively with you and all the guys that are in our system.

That piece and how I’m doing that is, for me, I’m reading stuff like How to Think Like a Roman Emperor. Marcus Aurelius, for me, is a fantastic case study with all the responsibilities that he had. I don’t have kids yet but I can imagine what that would mean because you have your responsibilities from a business standpoint and you have responsibilities from a family standpoint. You’re solving problems on both of those spectrums.

For me, it’s more or less how can I develop my mind to make sure that I’m ahead of the curve. If the team asks me, “How do we do this?” There’s a solution. A lot of the confidence from our team will come from us, it will come from our ability to solve problems or come from our ability to react appropriately to the situation. For example, if we’re in a large meeting and everyone is stressed and we’re stressed as well, imagine if you are on a plane and then you hear the pilot saying, “Oh my God, what are we going to do?” As a passenger, what do you think you’re going to do? You’re going to react the same way, if not worse.

It’s about the development of my mind. For me, how I’m doing that is around my journaling and my stoicism. I’ve been through a lot in my life so I can deal with a lot of things. That’s no excuse for letting your mind be idle. You have to constantly work on it. The main point is problem-solving. You’re a good problem solver, which I’m learning from. How to come up with interesting solutions to problems that we face?  

This is 1 out of 20. Imagine when we have 5, 10, 15, or 20 businesses. I’m not saying you need to be the smartest person in the room, you probably shouldn’t. You should be a good judge of character, a judge of people to bring those guys into the room that believe in our vision. At least, I need to constantly develop my mind so that I can solve problems that we have. For me, that is one of my biggest learning points and also points for improvement moving forward.

It’s super interesting, the point you make about a nervous leader. That is not a vote of confidence to the passengers. You are using the analogy of an airplane. As a parent, if a 1-year-old or a 2-year-old sees you losing control in their engagement, let’s say they’re throwing a tantrum, you lose. You are losing there and you are losing points on your ability to influence because you don’t control the child, you influence the child to make decisions. You lose that battle.

If that continues as a cycle where you get overwhelmed by deregulation, what then happens is the child picks up on that and then they’re in control. If they’re in control of that relationship, all sorts of challenges start to come to play because you can’t regulate them. It’s that mental stability, being calm, and still showing consequences in a calm way. If that happens, these are the consequences. Being positive.

If a child throws a tantrum, they’re expecting a particular response from you and you spin it on its head and you show the bright side of it or you change it to something else, it excites them and surprises them. It’s reflexive and you take control. It’s super important. I like that point about stability. Along with meditation, I’ve taken a leaf off your book on journaling. I’ve started to journal for most of the month of December 2022. Every every day of this month, I write my thoughts.

Right after my meditation in the morning, I start it out with my thoughts on gratitude. I train my brain to be grateful and figure out what should I be grateful for. If I struggle with those statements, my readiness for the day mentally would’ve been worse if I didn’t recalibrate to look at the things that I should be grateful for.

Physical activity is good. As we wrap up not just this episode but this year, this being the final episode on the pod, what do you think is the outlook for 2023? From an Octillion perspective and from our perspective, how many more acquisitions do you think we’ll make this 2023? Is this a year of stability, stabilizing Lean Caffeine? How far will we go in 2023?

If you look at it now, you have volatile equity markets, you have rising interest rates, and you have economic uncertainty. In the markets that the aggregators play in, M&A activity has reduced by 10% to 15% compared to last year. You then have a situation in which you have lower equity valuations that are now giving, more or less, buyers lower purchasing power. Also, the higher cost of financing is making acquisitions more expensive. I’ve just said bad stuff.

With that being said, I’m still bullish and we are still bullish. We are looking to make more acquisitions in 2023. We will be making more acquisitions in 2023 after hitting some key points and stage gates in LC’s stabilization process. For us, we’ve always placed orders on operating with excellence and also with discipline.

With that being said, it’s down to how aggressive we want to go. We’ve almost done two deals before the end of 2022 but we had to pull the plug because they did not make sense financially. It’s not from a financing standpoint but from a seller expectation standpoint. They weren’t aligned with the markets if you remember the multiples they were asking for. As you rightly said, within that period, you have to understand the psychology at that time to say, “Is this what my business is worth after my life’s work?” I understand but we cannot afford operate in that realm of emotional investments more or less. Business is business at the end of the day.

I’m optimistic about the market. It’s a fantastic time to do acquisitions. We’re seeing more and more interesting companies, at least brands, come to life. I saw an interesting opportunity. I don’t know whether that’s for sale but it would be a fantastic addition to our portfolio. For me, I’m looking forward to what we do in 2023 from a Lean Caffeine standpoint. I’m working on something interesting from a rebranding standpoint for LC.

Once that is done, people will get to understand the Octillion blueprint because that will serve as like, “This is more or less like our signature and it’s the first one.” I’m bullish. I’m looking forward to all that we have to do. I want to build a stellar team. I want to build like the Chicago Bulls for Octillion, for our marketplace company. They don’t even need to be superstars or they don’t need to be extraordinary. They just need to be ordinary people that can do extraordinary things and believe in our vision and want to work with us and they’re ready to put in the work.

I 100% agree and align with you. I do think that there’s always this fluidity. Back in April and May 2022 when we were on the pod, we had our playbook. Our playbook is our playbook. The markets gave us feedback. We self-reflected and we navigated to where we are now. We do have our plan. We are looking at twenty brands. We’ll acquire a few more brands in 2023. You never can tell. What if one of the brands is a $100 million company? Would we still need twenty?

What if Lean Caffeine is our platform company and all we are doing is buying supply chains from other brands? We’re trying to chunk it up and make it a singular company. Who knows? We don’t know. The one thing we want to do is not stay stagnant. Neither do we want to go into a state of entropy. We’re not contracting. We want to expand.

In our next conversation, we’ll be in a better place than now because of what we are doing. This is not a touch-wood lock or stuff like that. It’s because of how we turn up on a daily basis and how we’re approaching this. There’s confidence that this will be much bigger than what it is now from the impact it is making on the base. We will continue to create value. That’s our remit as co-founders for what we’re doing at Octillion. Those are my 5 cents.

I couldn’t have said it better. I was looking for a rap lyric to edit off but I can’t think of one. I was thinking of some Pete Rock stuff but it doesn’t align with this conversation but I agree.

Amazing stuff, partner. Thanks to everybody reading. If you don’t know about our brand, head over to OctillionCapitalPartners.com. We’ll be having more in-depth conversations in 2023 and also in-person events if you’re in London. What more can I say? Catch Ayo Disu on LinkedIn. You’ll also find him on Instagram.

If you want to have a conversation to find out more about what we are doing at Octillion, our mission, and if the mission aligns with you, let us know. We want to have conversations. Reach out to either of us. Everybody, have a fantastic New Year ahead. I hope 2022 was great however challenging it was. I wish you a much better 2023 regardless of how 2022 panned out. Cheers.