Chris Park

Accretive Partners - M&A | Private Capital; ex-Blackstone, Summit, BAML

[Chris Park @tipsyventures]

@BoringBiz_ There’s signal in that in M&A. It is basis for unlevered earnings power to price the enterprise.

If you’re analyzing structure you have no influence over and forecasting liquidity (i.e. lender), then makes sense to bridge to CFFO-capex. Different use cases. The more you know…

[Chris Park @tipsyventures]

Apples and oranges. Single-digit % of SFR "STOCK" might be owned by institutionals, but @highyieldharry is raising the issue of "FLOW" aka purchases. Prices are set at the margin, aka Flow. If insitutions are even 10% of marginal demand, that has a significant impact on pricing of course. And it introduces additional cyclicality as these are largely programmatic buyers that follow capital flows, rather than local market knowledge.

[Sahil Bloom @SahilBloom]

Your entire life will change when you start to embrace what most people avoid. Wake up early. Focus. Move your body. Eat real foods. Obsess over one thing. Read old books. Be present. Listen intently. Change your mind. Have difficult conversations. The recipe for a good life.

[Chris Park @tipsyventures]

Nice articulation. This concept gets constantly tested at the individual and societal level due to what seems to be an instinctive desire for humans to feel like they belong under forces higher than themselves (i.e., a higher genealogical or political authority). Without rigorous contemplation and self-discovery, the sovereignty of the individual is disorienting and unsettling to many. The drifting division of different peoples based on blood, origin, religion, and culture seem to naturally want to take root like weeds. At the education and societal level, we can do more to constantly reinforce these founding principles to fight atrophy and remind people of why the United States is special. I, too, am thankful to be a part of this great experiment of human progress.

[Chris Park @tipsyventures]

@BigJohn043 No one is getting ratings for the agencies’ credit analysis. Everyone is getting ratings for the ratings. The vast majority of global capital flows are determined by ratings constraints - whether due to covenants or capital charges.

[Chris Park @tipsyventures]

Think it's good to keep balanced temperament. Having been in both credit and growth equity (I am schizo), either side tends to have blinders on.

App-layer AI software can be incredibly profitable. Input costs are plummeting at a rapid rate - fully commoditized and VC funded. CAC low due to still early in the adoption cycle. R&D efficiency thru the roof.

Churn is not proven yet.

"Negative gross margin" is not the overarching story in this category, imo. There are other concerns.

[Chris Park @tipsyventures]

@OnlyCFO Most will decide to acquire after early winners are identified. Less internal friction and politics this way - and it's other people's money.

This is why AI founders today should build with an exit in mind within 3-5 years. And structure their market focus accordingly.

[Chris Park @tipsyventures]

@EghosaO @Trace_Cohen @GavinSBaker Cap table issues. Investor marks and pref stack difficult to square with reasonable valuation that is accretive to ultimate IPO/exit value.

[Chris Park @tipsyventures]

@AndyHVandenBerg @Camp4 Love this idea but I know these gems would have been wasted on me during college years 😅 Certain lessons require some living and regret to hit home

[Chris Park @tipsyventures]

Love your insight on the unlearning needed for credit-trained minds. Left that world years ago and still need to actively retrain my mindset. The love of complexity and technicality draws in the intellectually curious into this world, but often turn them into myopic thinkers missing the forest.

[Chris Park @tipsyventures]

I’m confused by this take on a situation where a franchisor engaged in abusive behavior. Having worked in PE and around it, I think we both know that PE involvement changes the culture and tone of a business (vs. entrepreneur-owned). Not an absolute negative or positive judgment, but it is undeniable that things change - and in this situation zee’s were stuffed with sudden, unplanned capex req. and faced intimatdation tactics - neither of which were in good faith. What would be, in your opinion, a fairer term than “private equity” to describe the root forces that caused the issue here?

[Chris Park @tipsyventures]

@FundamentEdge FExWITG

[Chris Park @tipsyventures]

@Slackwatercap @brianbeers Outstanding debt at exit needs to get netted from exit EV

[Chris Park @tipsyventures]

@FritzTheDev A few assumptions to caution you against:
(1) Don’t assume your career will go as you expected. Early career progression is linear. Mid/late is not.
(2) Getting rich is not a dream. You may be longing for more freedom or adventure, which is not necessarily a money decision.

[Chris Park @tipsyventures]

@brianbeers Think another consideration could be when you want to divest certain locations - headaches if financials and controls not already carved out by entity

[Chris Park @tipsyventures]

@chrisxmunn If you are acquiring a nail salon, it is more important to make sure your DSCR pencils out in a variety of scenarios.

Cash flows are less predictable than hard assets, so initial set-up LTV becomes stale quickly. Thus, lenders desire to maintain DSCR on an ongoing basis.

[Chris Park @tipsyventures]

@chrisxmunn This is a good heuristic for your typical cash flow SMBs. However, each metric matters in proper credit analysis - LTV, leverage multiple, and DSCR.

For asset-heavy businesses (e.g. real estate), LTV provides a measure of comfort that loan can be repaid with collateral value.

[Chris Park @tipsyventures]

@zacpennington @Joe43500107 @PandaExpress @franchisewolf Would be curious to see behavioral/survey data on this, but I suspect Joe is right here. For me as a consumer, the decision tree is “need QSR -> what’s around me/easy to pick up -> food genre” not “Food genre -> want American Chinese -> select restaurant”.