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The Wise Exit is an open dialogue with fellow founders and former business owners sharing real stories and offering honest advice around selling their companies to some of the top acquirers in the world.
Beyond the entertaining and educational exit stories, host and M&A Advisor, Todd Sullivan is here to help demystify the Mergers & Acquisitions (M&A) process. For example:
- How much is my business worth?
- What is Net Working Capital?
- When should I get a Quality of Earnings analysis
- Should I hire an Investment Banker, M&A Advisor, or Business Broker?
- When do I talk to my Key Employees about a possible transaction?
We hope you enjoy... and learn a few things along the way!
The Cashing Out Mergers & Acquisitions (M&A) Podcast | E29 | Paul Sullivan
00:00:01:14 - 00:00:27:12
Paul Sullivan
Maybe from my personal point of view, honesty has always been the big thing playing tennis. The balls in terms of outfits you call it the way it really is. And the same thing in business was always the same thing no matter how what the cost was. You got to do this right? So you got to find honest people to deal with, to taking you to where you want to go in business and also in action as well.
00:00:27:12 - 00:00:32:21
Paul Sullivan
I would think I'd be extremely important to know the people you're dealing with are good people.
00:00:34:08 - 00:00:56:18
Todd Sullivan
Welcome to the Cashing Out podcast, where our fellow founders share real stories and offer honest advice around selling their companies to some of the top acquirers in the world. My name is Todd Sullivan, CEO of Exitwise, where we help business owners create the exits they deserve. Today, I want to do something a little different and share a story about an 82 year old serial entrepreneur who is also a professional tennis player.
00:00:57:05 - 00:01:22:09
Todd Sullivan
I've known this person my whole life and he helped shaped my entire entrepreneurial career with his unwavering encouragement and lifelong words of wisdom. When he told me no one is ever going to give it to you. You have to fight for every point, every game and every match, every single day. And when he gave examples of great entrepreneurs and athletes that he remembers most, they were always the ones that succeeded with class and integrity.
00:01:22:21 - 00:02:00:02
Todd Sullivan
I hope you enjoy my conversation with my dad, Paul Sullivan. Pop. Thanks so much for agreeing to talk to me and our listeners and taking us through your entrepreneurial journey. I know that your story of building multiple businesses and inventing sports products all while playing professional tennis, it's really fun for me to look back on because I know as a kid we took all these things that we witnessed as your kids for granted from, you know, pro athletes at our door to your routine international travel for work.
00:02:00:13 - 00:02:22:01
Todd Sullivan
And it's really only now that we can appreciate all these efforts and sacrifices and really the influence that you had, particularly on me and my entrepreneurial career path. And I know our listeners are really, really going to enjoy this. So I really appreciate you being here. And actually, this is the first time we were going to bump Mark Cuban, but he just insisted that you take his spot today.
00:02:22:01 - 00:02:24:18
Todd Sullivan
So he's looking forward to that.
00:02:25:03 - 00:02:32:06
Paul Sullivan
That's funny, right? This is going to be fun. I hope I can do a good job for you. Yeah.
00:02:32:14 - 00:02:46:12
Todd Sullivan
Well, I think a good place to start would be, you know, take us back to when you were a kid in the basement and kind of the first time that you saw, I guess, really saw entrepreneur worship in in what your mom was building.
00:02:47:16 - 00:03:15:06
Paul Sullivan
Yeah, that's great. I mean, that's where it all started, I think, because my my mom was really unbelievable. We're talking about back in the 1940s when women didn't do these things. She started the business, which started in our basement. We lived in aa3 family home, was a two story, and then an addict and a cellar. And and my mother started this business in the basement.
00:03:16:02 - 00:03:40:11
Paul Sullivan
My uncle and my my dad built sewing rooms, cutting rooms, designed rooms in the basement all throughout the basement. And that's where it started, which is really, really quite unique. And she ended up to the point where she had a business all over the country and eventually actually went to China for Macy's. They sent it to try it in China to do something.
00:03:41:03 - 00:03:46:14
Todd Sullivan
So this business was called Edith Sullivan Tanis Creations. Right. So she was.
00:03:46:14 - 00:03:47:02
Paul Sullivan
That's correct.
00:03:47:03 - 00:03:54:00
Todd Sullivan
Making tennis dresses for like the kids originally, the kids in the neighborhood and their parents.
00:03:54:00 - 00:04:13:19
Paul Sullivan
She was originally making dresses for my three sisters, who are all great tennis players. And then it expanded from there and getting all the stores around the country to to buy into them. And that lasted, you know, forever. She was still trying to do business when she was 90. So. Yeah. Yeah. She was still at it.
00:04:14:01 - 00:04:32:13
Todd Sullivan
I remember it well. So. So that was a big influence. And then you write, you're a tennis player and at some point that tennis career turns into a business career. But why don't you take us through really starting to go to college, Right? You had a decision because you were a tennis player and a baseball player. A decision to make.
00:04:32:16 - 00:04:34:08
Todd Sullivan
So maybe you can tell us about that.
00:04:34:16 - 00:05:01:18
Paul Sullivan
Yeah, I mean, really, baseball was great for me. I love hitting a ball and running and feeling and everything, but turned out that tennis was the best sport for me. And I ended up very fortunately going to Harvard. And there I was. I was really quite naive. But the one thing that helped to be together was tennis and squash as well.
00:05:01:18 - 00:05:31:06
Paul Sullivan
They didn't have any indoor courts. We ended up playing squash in the winter. So at Harvard, tennis was only really in the spring with practice in the fall, played a little bit against each other, but basically was the spring had some great matches We agreed teams this my shop all year. We ended up winning New England championships in the collegiate championships and then I played the Nationals and came in fourth in the country and that was that was really fun.
00:05:32:05 - 00:05:56:18
Paul Sullivan
The we ended up also going and combining with Yale three players from Yale, three pairs from Harvard and we went to Yale to England and played eventually against all to Cambridge. We played there for six weeks, stayed at Wimbledon. Yeah. Was really, really, really fun. Anyway, it was great. Tennis was good at Harvard. But remember, there's no indoor courts at the time.
00:05:57:02 - 00:06:28:01
Paul Sullivan
They came actually right after I left. So squash also entered my my realm. And I had never picked up a squash racket in my life. And the coach, tennis coach was the same as the squash coach. And he said, Oh, you've got to play. You got to play this. Okay. So he started he was really a good teacher in squash, and he just taught us basically had to keep the ball going and being really tough on the guys could compete, know we'd love to compete.
00:06:28:01 - 00:07:08:02
Paul Sullivan
We could like, well, most of us could really run. And that was our method of getting better and better sooner or later. At that, I showed off like five on the freshman team and end up the last match I players played. Number one on the team is playing for the U.S. Open five man team. It was five five and team open tennis championships and played the remember the finals really well because we were playing in Canada in the finals and I was playing pretty well at the time and won the match very quickly with some fun details.
00:07:08:02 - 00:07:30:15
Paul Sullivan
But forget those. And as I get off the court, the coaches waiting for me who's all excited, you know, congratulations, give me a big hug. And I said, Oh, thank you, Jack. This is your racket. I borrowed the racket from them actually to play the match. And they said, Is your racket back? I'll never play squash again. You know, that was the truth.
00:07:30:15 - 00:07:34:20
Paul Sullivan
I never did play it again. I went on to tennis on a full time basis.
00:07:35:10 - 00:07:46:07
Todd Sullivan
Yeah, I love that. That you were pulled into that sport because the coach needed somebody and you used his racket the whole time and then handed it back and said, I'm done with this after a win winning.
00:07:46:09 - 00:07:56:00
Paul Sullivan
Yeah, it was a great smile. It was. It was a good sport when you didn't have tennis to play. But to me, tennis was so much more artistic and I just loved it. I just loved it.
00:07:56:21 - 00:08:10:01
Todd Sullivan
So. So you graduate, right? You were captain of your junior team. In your senior team on the tennis team, Right. Right, then. But that's not the end of of the tennis career. So what happens after right after college?
00:08:11:03 - 00:08:34:13
Paul Sullivan
Well, at that time, the Vietnam War was really just brewing. Really, really big problem. And a lot of my friends, you know, didn't want to join or they were trying to avoid the draft. But I thought it was an obligation to go to join the Army, which I did join the reserves. I thought that was the best course of action.
00:08:34:13 - 00:09:03:17
Paul Sullivan
I didn't have to stay there forever anyway. It was six months of active duty and then six years of reservist duty, which is a couple of weeks a year every week, once a week for years and years. Anyway, when I was in North Carolina during the active duty, I was stationed at Fort Bragg. And one thing I managed to do is to get connected to business.
00:09:04:06 - 00:09:28:14
Paul Sullivan
I had a car, my sisters bought me a car and I had it there parked outside the base. And and I had done a lot of my mother's tennis dresses in the car. And I would occasionally, when I could sneak away, I would go off and sell around North Carolina. And so it was it was quite fun. And I never, never got in trouble.
00:09:29:12 - 00:09:53:03
Paul Sullivan
Close calls a couple of times, but never got in trouble, but actually got me back in the business as I was still in the Army, but I wasn't able to play tennis except the last week of that basic training I ended up with on bivouac for the last week or whatever it was, where you go out and you stay in the field and not very pleasant and they are there and everybody's there.
00:09:53:03 - 00:10:19:04
Paul Sullivan
All, all the whole squad is there and all of a sudden a jeep rolls up and a guy gets out of the jeep and he says to the commanding general, who would like to see you? And I said, Why? And clearly he wants to play terrorists. So. So he took me in the jeep and I never returned to bivouac.
00:10:19:19 - 00:10:42:15
Paul Sullivan
And I stayed with the general for the rest of the bivouac. And unfortunately, everything was done after that. After bivouac, I only had to go back to barracks once or twice. A lot was not very popular when I went back. So that was it. It was sort of got my back in. The tennis was fun to play in there, but then off came back to Boston and started to play again.
00:10:43:23 - 00:10:57:01
Todd Sullivan
At what point did you decide that you were going to start your own business? Right. So you and your sister, as you're selling tennis dresses whenever you can write to make money and help help the family business, But at some point you're going to you start your own.
00:10:57:20 - 00:11:24:04
Paul Sullivan
Yeah. Right after getting back from the Army, I decided to start a men's tennis clothing business. My mother had always had the women's clothing, so I thought, now we can start the men's. And so I did. And I started Factory in Methuen, Mass. In an old mill building. They used to make shoes there, and power was powered by all the the water way right next to it.
00:11:24:21 - 00:12:05:06
Paul Sullivan
And it was is a really interesting places going back in time you're talking about the building's been there for so many years and I saw that. So selling tennis clothes made a few other products just to survive as well. But basically tennis clothes and my mother had I had been in business for a while, so she had a lot of contacts and very quickly, we got into a lot of top stores in the country Bloomingdales, Macy's, Abercrombie's, Saks, and at the same time, I was really playing still and playing better and better.
00:12:06:08 - 00:12:07:02
Paul Sullivan
So that was good.
00:12:07:18 - 00:12:13:04
Todd Sullivan
And then I asked, so this this this business is Paul Sullivan Sportswear, possibly?
00:12:13:05 - 00:12:13:18
Paul Sullivan
Absolutely.
00:12:13:19 - 00:12:22:01
Todd Sullivan
Yeah. Okay. So it's just like like your mom, right? The Sullivan tennis creations. Now you're doing Paul Sullivan's sportswear and it's just men's tennis.
00:12:22:14 - 00:12:47:16
Paul Sullivan
And we had a nice little logo that was very popular. I had all my friends, you know, wore the stuff, but we had everybody loved the clothes are great, great looking, great, well-designed. You know, even in the even the sports guys around Boston, You're from the Celtics and from the Bruins, particularly the Bruins would come up to the factory and they'd get their their freebies and wear them.
00:12:48:18 - 00:13:12:12
Todd Sullivan
Yeah I think that's one of the fun things kind of looking back as a kid not really understanding then that you know Bobby Orr and Johnny Music and just these professional athletes from Jimmy Connors and Chris Chris ever coming over to the house. I remember seeing photo shoots and just thinking that that was kind of that was normal.
00:13:12:13 - 00:13:22:19
Todd Sullivan
And now looking back and seeing that while Bobby Orr was at our house. Right. And you and I and all your all your tennis clothes and I think you're coaching him at the time.
00:13:23:16 - 00:13:46:10
Paul Sullivan
Well, actually, he loved to play tennis, but his knees were in pretty bad shape even when he was playing. And after he finished play, played quite a bit and we played a bit together. It was a good guy. He was really good guys. Anyway, that's we had one thing we always did is we had a free list and so we put a lot of people on the free list.
00:13:46:10 - 00:14:11:08
Paul Sullivan
All the friends of as we, you know, all our friends. When we did our catalogs, we had all our friends were the models of all the catalogs. And your model, by the way, was the sales manager after I started the business, got married a few years later and and she did a great job as a sales manager and established a for sale force all around the world, actually.
00:14:11:19 - 00:14:31:20
Todd Sullivan
Mm hmm. And so. All right, so you're building a business, right? And you got a little bit of a roadmap from your mother and you got some sales contacts. But, you know, you got to set up this operation and and you go and now you got to support the brand. Nobody knows this brand except for you playing tennis around the world.
00:14:32:06 - 00:14:36:20
Todd Sullivan
So can you tell us about that, like juggling building the business and playing tennis?
00:14:36:20 - 00:14:57:12
Paul Sullivan
And yeah, we also had a showroom at the Empire State Building in New York. You know, we went to shows by the business, but the biggest promotion was actually playing, I think, and trying to make manage the business as well as play at the same time was was a challenge, but it seemed to work out and it went all over the world to play.
00:14:58:00 - 00:15:31:15
Paul Sullivan
Had a wonderful time playing once a matches beat, some good players end up winning some fairly big tournaments. So I think some of the highlights of that were maybe people would think of it differently. I actually think of all the highlights of my tennis career, of playing with all my kids, including you and that was tremendous. I did play with some other really great players in doubles.
00:15:32:07 - 00:15:53:05
Paul Sullivan
Billie Jean and I won the U.S. National Indoor Championships a couple of years. I think it was 67 and 68. Yeah. I then played with another woman, was a great player as well, Patty Hogan. And we won the the outdoor the US Grass Court championships the following year, 69 I believe.
00:15:54:09 - 00:16:02:20
Todd Sullivan
Okay. So you won in 67 and 68 with Billie Jean King and that became the U.S. Open. So they called that the pre open era, right? Yeah, The.
00:16:02:20 - 00:16:31:12
Paul Sullivan
69 was the U.S. nationals outdoors. Yeah, that was indoors with Jean. That's what became the outdoors. Became the US Open Championships. Yeah. So on we went, we played a tremendous amount and I played the US Open 12 times. I'd say something like that, played one mile and it was just a lot of fun playing and mostly was playing because you weren't making a lot of money.
00:16:31:12 - 00:16:57:16
Paul Sullivan
If anything, know, I'm actually the last the biggest money I won. Was it? I mean, you had to do a lot to win a few bucks, but I won 20 $500 by winning the national championships and mixed doubles. Yeah. Getting off the court is the the doubles and the sixteens of the 60 of the singles. It's a lot of wins to win 20 $500.
00:16:57:23 - 00:17:03:15
Paul Sullivan
But it was a lot of money at the time so pretty excited about that. But that was really at the end of my career.
00:17:04:19 - 00:17:28:23
Todd Sullivan
So most people, most people wouldn't think that, right? Playing professional sports at that elite level and winning wasn't enough to sustain a real career in that you had another business going on and while you're playing right, you're the business's success. Awful, because people are seeing this brand and they want it in country clubs, they want it at retail.
00:17:29:17 - 00:17:38:05
Todd Sullivan
Were there any like fun moments where you knew right. Hey, I'm partially trying to win because I love tennis and partially because I'm marketing clothing.
00:17:38:18 - 00:18:15:22
Paul Sullivan
Or I can remember the one very well. I was playing with the the U.S. Open at Forest Hills was on grass. I was playing in the the clubhouse stadium court and I was playing against a guy from Yale, Donald Dell. And he was like, break me five in the country, you know, And we're having a great match. And first of all, if I go back a bit, I had sold Bloomingdales and a lot of the other stores, but Bloomingdales put a full page ad in The New York Times that day.
00:18:15:22 - 00:18:40:09
Paul Sullivan
I was playing to promote the brand and they thought while I was playing we'd be drumming up some business. So. So the whole time I was on the court was walking the court I said, This is a really big problem because I have to buy clothes, I have to look good on this court. Whether I win or lose a close have to look good.
00:18:40:09 - 00:19:04:02
Paul Sullivan
And so I'm playing along. And I was really worried about was that my zipper and my shorts would open up and I would be done for the business would be gone. And so I kept looking down at my zipper and we were there like three all set. And all of a sudden I looked down the check. My zipper is not open any.
00:19:04:02 - 00:19:29:21
Paul Sullivan
I was receiving soup and he served and he hit me where you don't want to be hit right in the zipper. So and I was down and he won the match and left. But the biggest thing is my zipper didn't open my clothes. I looked really good. So it turned out to be a good business day. A pretty good tennis day as well.
00:19:30:15 - 00:19:50:07
Todd Sullivan
That's great. So maybe we can jump into the tennis racket, right? Because, you know, you're running a business, you're playing professional tennis around the world, and then you've decided, hey, there's a there's a better a better way to do this. And you come up with. But the first aluminum tennis racket.
00:19:50:23 - 00:20:17:02
Paul Sullivan
Right? I was sitting with a friend named Peter Latham, who's a mechanical designer and design firm, was sitting watching. We were watching guys play and there's one guy out there playing with a racket was called the G2000, which is Wilson T12, which is a steel racket invented by renowned across a great pit as well. And we were watching an event and I said, Peter, you know, we should do we could do something better than that.
00:20:17:02 - 00:20:45:17
Paul Sullivan
This thing is just not playable. And basically it was a difficult racket to play with and not many people were successful playing with it. So anyway, we said okay, and I borrowed 5000 bucks. My uncle Frank, and that was enough to get us started. And off we went. We kept trying things and I remember trying one racket that was really felt great.
00:20:45:17 - 00:21:05:16
Paul Sullivan
But after I hit a few balls it would bent and it would come back. So that was a problem, both working on that one. We came up with a great poker tape and I played matches with it and so I thought we could sell this thing and.
00:21:05:22 - 00:21:08:13
Todd Sullivan
Well, what was the racket made of Result?
00:21:08:17 - 00:21:37:00
Paul Sullivan
It was the first aluminum tennis racket ever made. Yeah, it was really, really quite exciting. The whole thing was quite exciting. So we built this thing designed. We may have a few prototypes. We've got a fracturing firm that can make for, as I said, not make, you know, real production. So we were off to a show in New York for the thing, and it was also for showing sporting goods.
00:21:37:00 - 00:22:08:05
Paul Sullivan
So they showed the racket as well. And it was absolutely incredible because they sold 50,000 rackets in two days at at that show. And at the end of the second day, I had been doing business with AG Spalding. At that time, I they made them some private label tennis shorts. And so they the guy had dealt with it at Spalding, came up to me and and said, Paul, the President, Spalding would like to meet you back at the hotel.
00:22:08:21 - 00:22:30:10
Paul Sullivan
And I said, What about that? He said, What would you like to talk to about the racket? And I said, Well, maybe we could do it at lunchtime. And so we we did. On the third day they went to their hotel room and he made an offer that you just couldn't refuse to take it over. Just license it.
00:22:31:12 - 00:23:04:01
Paul Sullivan
It turned out to be by far the largest licensing agreement swirling in their head. So that was unbelievable. First of all, we had 50,000 rackets sold. I didn't have a minute battering planned in here with a big problem here. Anyway, that was quite eventful. A week later, contract thrown up, contract with John brought up with him, and I went off to Trinity.
00:23:04:01 - 00:23:19:16
Paul Sullivan
That's where Smalley was taken. He bounced to sign the deal and get the deposit. And so on the way up I realized, you know, I really didn't have much money and it's really broke.
00:23:19:16 - 00:23:39:00
Todd Sullivan
So. So let's take a step back for a second. So you go to this trade show with the new racket and it's clearly a hit. But you're they're really selling tennis clothes, right? Something that you've been doing for years and that that's the primary business. The racket takes off. And Spalding says, you know, we got to figure out how to own this.
00:23:39:00 - 00:23:53:11
Todd Sullivan
And, you know, today that would be, you know, months of negotiation. You'd have parties on both sides. But you got the largest licensing deal that Spalding's ever done, done in a week with like, did you have an attorney? How do you like it?
00:23:53:14 - 00:24:16:17
Paul Sullivan
And the journey was so the guy who stud did my business stuff and then they put the contract together and included an arbitration clause, whatever. But I was just happy to get the thing done. It was having to figure out how am I going to make 50,000 records selling 50,000 a day? I'll be selling hundreds of thousands next year.
00:24:17:13 - 00:24:35:03
Paul Sullivan
So anyway, yeah, it was. It was it was a quick deal. Yeah. You know, getting that nice, sweet Jack driving back and back and just couldn't believe that I was in and out of the business so quickly.
00:24:35:21 - 00:24:44:14
Todd Sullivan
That's fantastic. So you get a big check to start the deal, right? And then you got royalties ongoing as they produce and sell property.
00:24:44:14 - 00:25:12:15
Paul Sullivan
Yeah. A hefty, hefty percentage in the royalties. And they had a they had a guy named Poncho Gonzales who was the best professional player in the world, you know, on their on their list of players. And he had a racket with his name on it and he dropped that racket and used this racket and, you know, came came around, did great with his 42 at the time, and he's still playing great, he said.
00:25:12:15 - 00:25:15:04
Paul Sullivan
He added five years to his tennis career.
00:25:15:04 - 00:25:16:12
Todd Sullivan
So, yeah, I remember that.
00:25:16:12 - 00:25:18:05
Paul Sullivan
Yeah, it's quite incredible.
00:25:18:16 - 00:25:28:12
Todd Sullivan
I remember reading about him, talking about switching to that racket and how it added years to his career, the ability to hit the ball harder and.
00:25:29:02 - 00:25:58:17
Paul Sullivan
You know, control the aerodynamics of the racket were really the big thing. And that's how I started winning matches. I probably shouldn't have won because no one else had the racket when I was starting and then everybody was getting the racket. So it wasn't with his many matches, but but he won. He won big time. I remember him playing in the stadium in the open, and I'm sitting right next to the court and I could hear him talking.
00:25:58:17 - 00:26:10:11
Paul Sullivan
And he kept talking to himself and he kept saying, Cover the cover the ball. This thing's going to fly off, off the strings, cover it. And so he did a sort of like a mad man. So it was fun. I was like.
00:26:11:02 - 00:26:33:17
Todd Sullivan
Oh, that's got to be amazing to kind of see your product in action and also create that little edge, that little competitive advantage for yourself. Right. And it reminds me a little bit of of what you were able to figure out for me in hockey, right? And having somebody sewed together my hockey equipment. Right. And everybody know what is that right?
00:26:33:18 - 00:26:45:15
Todd Sullivan
There's no brand on it. Everybody else had the brand. The competitive advantage of being lighter took off. Probably a few more bruises, but my stuff was lighter than everybody else. Yeah, that was really you.
00:26:45:15 - 00:26:47:04
Paul Sullivan
Designing that stuff and.
00:26:47:09 - 00:26:48:06
Todd Sullivan
Is not me.
00:26:49:20 - 00:27:00:18
Paul Sullivan
I think he had a Z on it or something at that at the end. What? That was the brand. But anyway, that was on it and yeah, it was fantastic the way you could handle those powers.
00:27:01:17 - 00:27:08:03
Todd Sullivan
Yeah. And not too dissimilar like Sean and I went to a trade show with that Shox prototype, right? That skate.
00:27:08:16 - 00:27:09:00
Paul Sullivan
That.
00:27:09:03 - 00:27:29:00
Todd Sullivan
Was, you know, it was, it was definitely a prototype, but maybe you could skate a little bit better and in certain ways. And, you know, we pretended we were going to sell it at that trade show. And then along came a brand and said, Hey, will we want to license this? And so we did very much the same thing, you know, Got it, got a check and then ongoing royalties.
00:27:29:13 - 00:27:43:00
Todd Sullivan
But so your your situation right. You alluded to this idea that you had an arbitration clause and that becomes very important in this this story with the racket. So why don't we finish that side of the.
00:27:43:00 - 00:28:11:20
Paul Sullivan
Well, anyway, the checks were coming in quarterly from Spaulding, and they were big for us. For me at that time, the you know, back in 1960, 69, 70 in that area. So where the were coming in, I remember like every month, I can't believe we're getting this much money. We're not doing anything here. And we're like a barn in the in the clothing.
00:28:11:20 - 00:28:41:03
Paul Sullivan
But I feel like I'm not working much here. And we actually stole and decided to do another racket at the time so that the other product. But anyway, after about two years, bowling was bought out by a company called Questar and they stopped payment on the deal. They decided not to pay us and the quarter came in looking for the check.
00:28:41:12 - 00:29:01:17
Paul Sullivan
You no check and wait a week and then finally called my buyer as following is what's going on. He said, I don't know. You have to call this guy. And I called that guy said, You have to call that guy. Finally, I end up calling the general counsel and he said, We're not paying. You can't do anything about it.
00:29:03:00 - 00:29:29:13
Paul Sullivan
And so we had an arbitration clause in the agreement. So I talk to my lawyers, we end up taking them to arbitration. And remember, there is three days of arbitration and after the second day and my lawyer said, April, I never tell my client anything like this, but there's no way you can lose this case. They just blatantly infringed upon it.
00:29:29:13 - 00:30:00:10
Paul Sullivan
The agreement. They actually try to, Rachel, actively cancel the agreement. So anyway, they went by that night, I got a call from someone who said he was one of the other arbiters and said that he could help us. He thought I was a good guy and that he could help with this case. And I said, I don't know what you're talking about, but I'm not interested in anything like that taking a dump.
00:30:01:08 - 00:30:32:11
Paul Sullivan
So anyway, I called the lawyer. I didn't record the call, and so that went nowhere. Next day we're going next time ago to the third session of the arbitration, and they actually make a decision and we lose the case, which was unbelievably devastating. But time goes on and we six months later, the patent issues, the patent had an issue that at that to people that was just patent pending.
00:30:33:07 - 00:30:56:23
Paul Sullivan
And so patent issue we sued them again. And this time it took a while for the first trial to go through and we won the first level one of the next level. And when they appealed it and the one at that level and I don't remember how many levels it were, it seemed like level after level 11 years at the years going by here.
00:30:56:23 - 00:31:24:02
Paul Sullivan
And finally we get awarded treble damages three times what they would have paid if they just stayed with the agreement for I think that was willful insurance. They call it willful infringement. So we got treble damages for that. So they appealed. Even after all those appeal, they appealed to the US Supreme Court, which is absolutely ridiculous. The US Supreme Court.
00:31:24:07 - 00:31:50:18
Paul Sullivan
What the hell? They see one case out of 100 at most. And so time goes by. We're waiting. We we're waiting. Then my lawyer said, Oh, we can't take that. We're not going to take it to the Supreme Court unless you we get a piece of the action other than what we had agreed to pay on it. So that's not right.
00:31:50:18 - 00:32:20:06
Paul Sullivan
You agreed to it. I should stay with the deal. He said, Well, we won't take the deal. And finally I agreed. Okay, go. And we took it to this. Well, we're going to take it. The Supreme Court. But the Supreme Court denied the hearing it so they didn't have to do anything. And then maybe I think it was a month or two later, Spalding showed up in Boston at my bank that my friend was at Brown was our friend, and handed over a fairly large check.
00:32:20:21 - 00:32:35:00
Paul Sullivan
And that was sort of the end of the dealings with Spalding. They went on and did some other stuff and and we did another racket after that, which was exciting again. So yeah, that's about it to that point in the racket.
00:32:35:00 - 00:33:00:10
Todd Sullivan
But so yeah, it's an amazing story, right? So you invent the racket, you get it license, you're enjoying these royalty payments, which are really significant and they then small, then get sold and write that. And then the new owner says, We're not going to pay, right? This is too lucrative. We're just going to see what happens. And then it takes years of lawsuits all the way to the level of the Supreme Court.
00:33:00:20 - 00:33:06:06
Todd Sullivan
And then even your lawyers turn and say, we want more money. Yeah, after winning and winning and winning.
00:33:06:20 - 00:33:07:19
Paul Sullivan
And so I don't know.
00:33:07:19 - 00:33:09:19
Todd Sullivan
How many how many years went by?
00:33:10:04 - 00:33:13:20
Paul Sullivan
Oh, there was six years, probably six years. One and so on.
00:33:14:16 - 00:33:22:06
Todd Sullivan
So six years. And how is the business doing that with all the kind of clothing manufacturing? Are you still in Methuen, Mass at this point?
00:33:22:06 - 00:33:55:06
Paul Sullivan
Clothing was doing quite well and until elected in 1974, when we had a flood in the in the buildings. And that was an absolute disaster for us. We had three floors in the buildings. The bottom floor was cement and the other two floors were wood. We had machinery on the top floor, we had fabric on the second floor and we had more storage on the bottom floor.
00:33:56:11 - 00:34:08:00
Paul Sullivan
And the one the sprinklers actually was a fire alarm went off, but it didn't sound in the fire department, which happened to be on Christmas Eve.
00:34:08:09 - 00:34:09:17
Todd Sullivan
Christmas is on Christmas Eve.
00:34:09:18 - 00:34:40:21
Paul Sullivan
Christmas Eve. And they filmed in which was connected to the fire department, didn't connect. And so the water from the property was freezing. This was 20 below zero and the pipes broke and that they just flooded for hours and hours was more than 24 hours. But someone finally discovered it and they had four feet of water on the basement and the bottom floor and had gone to all the other floors and ruined everything.
00:34:41:18 - 00:35:07:17
Paul Sullivan
So basically we had all our green merchandise in the inventory already to deliver, and by the result it was gone. So I couldn't do much about that. So I didn't have any business for the spring, so I couldn't manufacture fast enough and I couldn't get the equipment. I couldn't even get a contract with somebody.
00:35:07:17 - 00:35:09:13
Todd Sullivan
And you had to pay off debts, right? Oh.
00:35:09:20 - 00:35:29:08
Paul Sullivan
Yeah. Yeah. Like that was just crazy because I, I remember lying in bed say, Oh my gosh, I got to get up the interest is is piling up here. I got to get up and get to work. And anyway, what, six months or more after that, fighting with the insurance company, we got $0.10 on the dollar, finally settle whatever we get.
00:35:30:13 - 00:36:14:00
Paul Sullivan
And at that stage the business was basically in deep trouble is gone, basically gone, trying to revive it. I tried a little bit in Massachusetts and just didn't work out very well, but I had actually previously started a factory in Puerto Rico making a lot of military equipment, uniforms. And so I decided we would then have to put all our efforts there because they all had a lot of money close to factory and the other one and made a lot of goods not on their old label anymore, but Nike and Adidas and a lot of other name brands made tons of stuff and took about six years.
00:36:14:16 - 00:36:38:03
Paul Sullivan
The bank finally stopped the interest on the payment because if anybody is listening here that is old enough to remember the seventies interest rate, I think it was 74 something was in the twenties. So you can imagine with the interest was piling up. And anyway the bank was kind enough to stop the interest payments and, and eventually did was like six years later paid off the loan.
00:36:38:12 - 00:36:46:15
Todd Sullivan
All right. So is, is I'm trying to get the time frame right. So has the lawsuit with the racket finished at this point or is that still.
00:36:46:19 - 00:37:12:07
Paul Sullivan
Just about finished collecting the money? That's done. And we get some money for the record, but we're talking about a lot more money from the inventory loss and everything else that goes in the business. Yeah. So I concentrate on Puerto Rico and that built up over time end up with two factories there, three pretty good environment to manufacture, the one when they were really, really great.
00:37:12:08 - 00:37:39:21
Paul Sullivan
Not too many men involved. So that was fine. And then during that time, I decided to open a factory in Jamaica, which I went in and actually purchased a small one, really quite small. And then six months later, our actually started another one in free zone and had that for quite a while in.
00:37:39:21 - 00:37:42:04
Todd Sullivan
Can you explain the free zone?
00:37:42:04 - 00:38:11:13
Paul Sullivan
The free zone, actually, NAFTA was the big thing at the time, which is an agreement that you could bring goods in from. Basically that's gone in Central America to the US tax free. It had to involve U.S. products, the base of the product legally, the materials from the US business was pretty good. Jamaica wasn't a great environment. There's a lot of drugs going on.
00:38:11:13 - 00:38:44:11
Paul Sullivan
I remember the businesses next to us. We shipped out big containers, then one of the businesses next to us and shipped that one to Miami and the customs agent opened up the back and out came marijuana bags and bags almost buried the customs agents. That was big trouble. You always had to have an armed guard to take you the container to the to the airport or to the port and then dogs sniffing everywhere.
00:38:44:11 - 00:38:48:23
Paul Sullivan
So it was not a great place to to really do that kind of thing.
00:38:49:04 - 00:39:03:08
Todd Sullivan
Let me ask, though, so did that business get purchased? Did somebody want to buy that business? I know there's a story around combining the Puerto Rico and the Jamaica factory to sell it to a group in Iowa.
00:39:03:09 - 00:39:43:09
Paul Sullivan
It's well known that's actually the Iowa thing is the clothing. But the big go back to that. I had an opportunity at one point to sell the the clothing business when it was going quite well. Some lawyers say this company and I were interested in buying a clothing company. And so I explored the interest, went out there and it involved moving the whole family as part of the big issue for me, because to me all along, this is a family thing for my mom and my sisters and all my kids, you and the grandkids, now it's family involved.
00:39:43:20 - 00:40:05:23
Paul Sullivan
And so that was a really big issue for me. But they again, offered a really good deal. And part of it was that I'd have to we'd all have to move there or I have to move now. And everything else was kind of cool with me for at least two years. So anyway, we got to the point where we had agreed on all terms of the deal.
00:40:05:23 - 00:40:27:07
Paul Sullivan
I thought we had agreed on the old terms and we came to Boston to sign the deal and put the deposit down. I actually paid the full amount and my lawyer said to me, Well, we have to change something. That's what we are all agreed why we change. You said, No, I don't like this one thing here. And I said, But it doesn't mean a thing.
00:40:27:07 - 00:40:44:20
Paul Sullivan
Forget it. And he said, No, no, we can't. We can't do that. So we go into the room and he said to them, We have to change this. You know, it's not right. We don't like it. And they say, well, we're not changing it. And they said, Oh, we have to change it. We're not changing. And he said, Well, we we have to change it.
00:40:44:20 - 00:40:52:05
Paul Sullivan
And they said, okay, goodbye. And they left the room. And that was the end of that deal, literally, I think.
00:40:53:15 - 00:41:19:02
Todd Sullivan
I'm sure there there is a lot to that. But I think the maybe the lesson and we see it all the time, is that, you know, we surround every business owner, every founder with the M&A dream team. Right? And these people that we're giving them are elite and that's what creates these amazing outcomes. But there are times when you have to understand and you have hired these people and you need to control them.
00:41:19:14 - 00:41:44:03
Todd Sullivan
And there are times where lawyers, they are there to protect you, to really limit your risk. But there is a point where an a deal needs to get done and you need as as founders and us shepherding founders through this M&A process, we often step in and say, enough is enough. We know what kind of risk we can live with, and the probability of something going wrong is so low.
00:41:44:17 - 00:42:03:15
Todd Sullivan
But we we see that some of the attorneys don't see it that way. They've got a win. So I just encourage founders and business owners who are selling to really take the reins at the goal line and not ruin really good deals, not let their representatives ruin really good deals. So, yeah, yeah, that's that's a bit of a shame.
00:42:03:15 - 00:42:12:02
Todd Sullivan
But I also it's and when we talked about it, you know, you could have called back, you could have revived it, but something didn't feel right.
00:42:12:16 - 00:42:36:22
Paul Sullivan
Yeah, exactly. I think the idea that all of us moving to Iowa, where I grew up in, you know, in Massachusetts, going to school in Massachusetts and loves being in this area, and you guys were all playing hockey all the time. And it is it was good for everybody to sit around. So it was always that in the back of my mind going through this whole deal.
00:42:36:22 - 00:42:46:09
Paul Sullivan
And then when it blew up, it was like it was always like a relief. I mean, we don't have to go to Iowa, but you ended up in Iowa anyway to play hockey.
00:42:47:06 - 00:43:03:18
Todd Sullivan
You? Yeah, Well, so So that deal blows up and then it's a year later, Christmas Eve, where the factory, the pipes freeze and and the pipes burst and basically bankrupt the factory.
00:43:03:18 - 00:43:07:01
Paul Sullivan
Yeah, yeah, yeah. And so I.
00:43:07:01 - 00:43:14:18
Todd Sullivan
Don't know any is any regrets on that. I know you've come to me around saying, you know, you got to know when it's time to get out.
00:43:15:13 - 00:43:43:08
Paul Sullivan
Yeah. I think that the business was so much oriented around friends and family that wasn't really in my mind. It's just time to get rid of this thing. But I think that's a big mistake. You got to know when it's time to take it beyond. You can take it. And at some point this some professionalism needs to be involved.
00:43:43:08 - 00:43:47:20
Paul Sullivan
And I wasn't really that a professional.
00:43:47:20 - 00:44:13:04
Todd Sullivan
Yeah, I think it takes a, you know, an extraordinary founder to really or business owner to really understand where their skill set, you know, starts and ends. And so I think what you're talking about is like once you reach that limit and you've taken the business as far as you think you can take it, you have to either bring in real professional management or potentially sell that business, bring on, you know, financial partners that have the resources to do it to the next level.
00:44:13:17 - 00:44:32:09
Todd Sullivan
Yeah. So okay, so business then goes through that really that shut down that bankruptcy. But you started up a second business in Puerto Rico, right? And you're now not doing the Paul Sullivan sportswear, but you're doing more military garments. Yeah.
00:44:32:11 - 00:44:57:13
Paul Sullivan
That we actually, we actually just didn't go through a bankruptcy at that time. We just closed it down and ended up having paid and when we could get we owed. But with the we did have the factory in Puerto Rico that was going pretty well. So the other one in Jamaica, two factories, actually a small one then purchased and then another one in the free zone that that they both were going pretty well.
00:44:57:23 - 00:45:19:04
Paul Sullivan
A lot of a lot of product coming out of it, making mostly for Nike and Adidas and other name brands tons of goods for the Nike particularly. And they came to me and said they want us to do more business. And then that meant investing more. And I just didn't really want to do that. And I told them it wasn't for me.
00:45:19:15 - 00:45:47:18
Paul Sullivan
And they said, Well, we got someone on a malaysia company out of Malaysia that we're doing business with over there and they're looking to buy a company that has connections in the States. And so we ended up selling like both Puerto Rico and Jamaica to this company. SBT was called in in Malaysia. And interesting times dealing with this, these guys.
00:45:48:15 - 00:46:11:21
Paul Sullivan
And part of the deal was they get X amount upfront and then about 30. And I had stayed around and worked with them for two years afterwards, which is okay. And then they get the balance of the payment again. And, you know, business is not easy, not sometimes not pleasant. Things are going pretty well. They were doing fine.
00:46:11:21 - 00:46:43:09
Paul Sullivan
The factories were doing fine, but they at the end of it, they didn't want to send the last payment. And so it just it was not pleasant. And it took actually one last telephone call to the chairman of the board, and it was telling that I don't know what's going on, but I don't think everybody around the world wants to know what's going on in these factories now.
00:46:43:20 - 00:47:10:03
Paul Sullivan
But I want my money by noon tomorrow. And I got the wire transfer by noon. So that was it. That was done. And now I could breathe a little bit. I had some time on my hands and all along I'm watching hockey games and tennis matches. I watched 100 games in one year that you played. This is crazy time traveling back and forth again.
00:47:11:01 - 00:47:29:21
Todd Sullivan
All right. So let's just go back a bit. Right? So this is the second sale of a business that you're that you're going through, right? Well, well, first is the license really of the racket. And you've got an acquisition to that, the group in Iowa that falls apart. But then this one with the group in Malaysia is going to go through.
00:47:30:04 - 00:47:38:14
Todd Sullivan
Did you have anybody representing you in that? Right. Because you're you have earnout payments, you've got balloon payments, you've got some sophistication around. You know.
00:47:38:15 - 00:48:09:11
Paul Sullivan
I had some guys that were I thought were pretty good at it. And I don't think overall. Okay. But you can deal with some tough people and tough situations. So I can't blame them for anything in that at all. It worked out in the end and then it came in the breather to just go on and think, What should I do next besides watch some hockey games or tennis matches and play a little bit?
00:48:11:00 - 00:48:36:10
Todd Sullivan
Well, it's not just watch some right? What I think is amazing, one of my favorite parts of playing hockey, right, is having you come to every game and be in the stands. And when I say game, it comes back to, you know, some of the things that you took for granted. I remember playing against Northeastern and being interviewed after the game and saying, Oh, it must be great to come home to play so your family could see you.
00:48:36:10 - 00:48:56:16
Todd Sullivan
And I said, Well, no, my dad comes to every game. Like, what do you mean? Like, yeah, he goes to every game that we that we play in. And, and by the way, he's flying from El Salvador to do it because you had started another company in El Salvador. And then that story just kind of took fire. And then you were featured in Sports Illustrated.
00:48:56:16 - 00:49:11:08
Todd Sullivan
The article was called Frequent Flier. Right. And it was not about me in hockey. It was about you coming to see every single college hockey game that I played in. And I just thought, that's what that's what everyone did.
00:49:11:08 - 00:49:34:07
Paul Sullivan
Well, you know, I did miss one game and I was really disappointed. It was you played up in Alaska and it was a Christmas and I really couldn't. We allowed it leaving home at Christmas to go see hockey in Alaska. So that's the game I missed. It was a great game too. I remember that play against Maine in the finals anyway.
00:49:34:17 - 00:49:39:02
Todd Sullivan
So Paul Paul career scored twice on me to win that game 2 to 1.
00:49:39:06 - 00:49:40:10
Paul Sullivan
That was it. That was.
00:49:40:10 - 00:49:42:03
Todd Sullivan
It was. That was a good game.
00:49:42:04 - 00:50:06:13
Paul Sullivan
Incredible game. The those trips back and forth. Well, El Salvador, I started a factory in El Salvador when I searched around to do something else. Yeah, I chose El Salvador after visiting several times. They they were still in fighting each other. A civil war was going on for, I think, 12 years, a long time. And when I first went in, it was it was scary.
00:50:06:13 - 00:50:39:21
Paul Sullivan
It was Guns everywhere machine gunners in bunkers. And anyway, for some reason, I was convinced that the people were so good that I would start the factory there. And I did, and turn out to be really, really good. The workers workers are great. We end up with the, oh, I think 2300 people working several factory buildings and producing three quarters of millions of products every week, shipping it out.
00:50:39:21 - 00:51:00:21
Paul Sullivan
This is a lot of a lot of lot of product. So anyway, besides traveling back and forth every weekend to watch hockey games in in the winter or just running that business down there and back home down there. Back home. But it was it was a tough area. I mean, it was tougher than Jamaica and that's going on.
00:51:02:07 - 00:51:26:23
Paul Sullivan
I mean, there's always something going on and just beheadings and this terrible stuff going on. But anyway, they that went on really quite well. And I remember being back in Boston, going to Papago for lunch, the little town restaurant and getting my sandwich. And you were there and you sat down and said, Dad, I got a really good idea.
00:51:27:12 - 00:51:47:19
Paul Sullivan
And you came up with the idea of personalizing the clothing and selling it on the Internet. And this was way back when no one did that. It was like the first to do it. So that's how that business was called, my God, to start with. And then you had another one and you ended up with a what was it, the u turn?
00:51:47:19 - 00:52:20:07
Paul Sullivan
Another one was more towards spiritual, spiritual towards schools, sort schools. It was, it was that was a really fun business. So that kept going along pretty well. Patrick Producing a lot of clothes, but then really reality set in that El Salvador was a nice place to make merchandise, but the prices, the cost of doing business, going up government was not easy to deal with, to say the least, and the environment overall was tough.
00:52:20:13 - 00:52:53:18
Todd Sullivan
Can I jump into that right now? So, you know, you were there and I remember these stories of, you know, you're staying in a hotel room that doesn't have a wall, an outside wall is missing because it's been blown out. I remember, you know, I tried to come and learn the business and being there, there was a guy that was throwing a tree trunk in front of a road to block cars and then taking a a wild animal by the tail, throwing it into the car and having it tear the people up inside.
00:52:53:18 - 00:53:11:21
Todd Sullivan
And then the people would come out of the car, he'd kill the people and steal the car. And this was going on for weeks until the police, you know, staged the fake car and caught the guy and took him out in the back of the woods and shot him in the back of the head. Right. That was what you you dealt with.
00:53:12:04 - 00:53:31:07
Todd Sullivan
And and you had one employee, right. Where family members were kidnaped. And it was crazy that government would even give rape bodyguards for as long as you wanted if you had a family member that was kidnaped like that was a thing. So it was a really dangerous agent, you know.
00:53:31:07 - 00:53:58:18
Paul Sullivan
Who was good and who was bad. Either never going to admit this to people who spoke English, and my Spanish was pretty weak. And they said, Oh, come to dinner with us. So they went to this restaurant and restaurants down there outside. Yeah. And I parked my car in a side road and they told me where to park and, and there was other those guys there.
00:53:58:18 - 00:54:25:09
Paul Sullivan
There's a couple of girls, guys and I say, Bye Calgary safe here. And one of the guys, a big guy, said, Don't worry about it. What if someone steals it? Won't know where it is. Okay. So I Oh, boy. Okay. So we go into this restaurant and everybody's have a good time. Their music is playing and and I just think this is kind of a strange place.
00:54:25:09 - 00:54:57:18
Paul Sullivan
First of all, you walk in and they have a gun rack, and everybody puts their guns on the gun rack. Except I don't have a gun. And so then we go sit down and play music and people dancing. And I'm sitting there looking at the gun rack. I mean, that's weird. Why am I here? This is crazy. And then all of a sudden they hear gunfire outside and everybody at the table, except every man at the table, except for me, gets up, runs in the gun rack, grabs they run and runs outside and there's a shootout.
00:54:58:13 - 00:55:17:16
Paul Sullivan
It turns out that the guys that were at my table were from the police and they said the score outside, they came back in just like nothing ever happened. Guns back in the gun rack and they came up to the table. Music started again. Back to having a good time.
00:55:18:07 - 00:55:42:00
Todd Sullivan
Yeah, that was crazy place because you didn't know who was a police officer and who wasn't and what the rules were. Yeah, that was incredible that you were there for for that long. And you know, in hindsight like that, that's some danger. And I mean, I think it brings kind of the point. One of the points you and I were talking about in in entrepreneurship, in building these businesses right.
00:55:42:00 - 00:56:04:01
Todd Sullivan
You just you just got a battle. Nobody is going to give it to you. Right. You got one of the biggest corporations in the world trying to steal from you. Right? You've got an international companies that buy your company and they don't want to make payments. And then you got to go to all points in the world really to get quality and inexpensive labor in order to compete.
00:56:04:01 - 00:56:18:22
Todd Sullivan
So it's really like anything to survive and thrive. And I think you talk you talked a lot about the business and sports, how you know, what you have to give in order to be successful. Maybe you can say something to that.
00:56:19:10 - 00:56:42:07
Paul Sullivan
You know, I think you mean you have to compete, compete, compete, always compete in the tennis and the squash, and you have to fight and fight for a point, a fight for a match. So it's no different in business. It's just it turns out it's all fun. It's you know, they have to compete all the time. You have to be aware of what's going on.
00:56:42:07 - 00:57:07:19
Paul Sullivan
I think the competition was a big problem in El Salvador because their wages were going up and and China was in. They pay nothing literally, nothing to the people. And so the goods were flying and they could you could buy anything and a 10th of what we can make it for. And so that really killed El Salvador. Eventually we killed the business and finally ended up turning it over to management and leaving it.
00:57:08:07 - 00:57:23:09
Paul Sullivan
I was pretty pretty much one and two. That time was close to 70 at the time. And so I just turned over to them and they they tried to run it after that and that was it. That was of the end of the the business, I think. Yeah.
00:57:23:10 - 00:57:50:16
Todd Sullivan
I think that final move of essentially selling the company to the employees, the management for $1 is what you did right. And one of the things that impressed me along the way, really kind of looking back and thinking about the story, is how, you know, in Methuen, Mass, you know, I would go to that factory and I'd slide down the slides where clothes would go down from an inventory room to a cellar.
00:57:50:16 - 00:58:11:05
Todd Sullivan
And I met all the all the ladies sewing. And then you would take them, you know, take the whole company on cruises. And so very much these businesses were felt like extensions of family right there. Yeah, they were. They were really personal. So it wasn't about kind of maximizing dollars and maybe business as a business is a little different today.
00:58:11:05 - 00:58:27:23
Todd Sullivan
But I think a lot of particularly the baby boomers have built a single business over the last 40, 50 years right in it. And it satisfy the needs of their family and they found some level of success. But a lot of family members don't want to be, you know, the next generation doesn't want to be in that business.
00:58:28:06 - 00:58:51:12
Todd Sullivan
And so they're looking for, you know, how do I how do I close this up or how do I sell it and get kind of a the last payday and your last payday really was that $1 handing it off to to the employees and being 70 years old and saying, okay, it's time to time to call it quits on the business front and really just help us going forward in business and really what.
00:58:52:02 - 00:59:20:16
Paul Sullivan
I don't know which help I was, but certainly I had some background that at least in in what not to do. I think I was pretty good at that by that point. I think the timing is everything with these things. And I think maybe to know when to get out is huge in a business and to be able to get trusted people to advise you and how to find a good buyer.
00:59:21:12 - 00:59:41:17
Todd Sullivan
Yeah, I think, you know, those are those are really good points. And I was just going to ask you, like what your, you know, your best advice would be to people that have built a business and they're ready to kind of turn that page. You know what? How do you think they should be thinking about it? Really? Any advice that you have to to fellow business owners?
00:59:43:01 - 01:00:12:13
Paul Sullivan
I think one would be to look at things and make sure that the advice you're getting was once concerned with what you believed was good sound and not let someone really take you over and make your decisions. You got to make a decision whether you want to sell this or not. And the other thing is that maybe from my personal point of view, honesty has always been the big thing.
01:00:12:13 - 01:00:34:03
Paul Sullivan
You're playing tennis, the ball is in or out. It's you call it the way it really is. And the same thing in business was always the same thing no matter how what the cost was. You got to do this right. So you're going to find honest people to deal with it, taking it to where you want to go in your business and also in it as well.
01:00:34:03 - 01:00:39:12
Paul Sullivan
I would think it'd be extremely important to know the people you're dealing with, good people.
01:00:40:12 - 01:01:16:21
Todd Sullivan
I think that's boy, what you just hearing you say that how I've seen you live that life and I hadn't equated it to business but yeah that's how you know you really lived your business life and so knowing your wow, what a lesson that's really hard to do. And I think business owners need to do as much due diligence on a buyer as they are as the buyer is doing due diligence on them when it comes to a transaction, particularly when you're going to have to work there and earn more of your income and then you're handing a legacy over to these buyers.
01:01:16:21 - 01:01:41:20
Todd Sullivan
So getting to know them and really having the people that are representing, you know, who you're selling to. So, you know, you know exactly what your what you're getting into. All right. So when you when you had multiple exits or you sold or you got the licensing agreement done with the racket and Spalding, how did you celebrate?
01:01:41:20 - 01:02:04:23
Paul Sullivan
Oh, that's funny. I mean, the first thing I think of is I can't spend this money. I mean, I was not good saving money. I was probably the worst person in the world saving money. And so I bought my dad a car. I bought my mom, all the ladies in the family, sisters, all for a coach. And we had a great, great time.
01:02:05:11 - 01:02:14:12
Paul Sullivan
And so that was it. I think that that was my celebration. I mean, yeah, that's sort of fun.
01:02:15:05 - 01:02:24:15
Todd Sullivan
All right. So just final question. So is there one person that you would like to thank that really contributed to your personal and professional success?
01:02:26:13 - 01:02:51:22
Paul Sullivan
Well, for me, it's I have to thank God that's certainly the number one thing. If you give me more than one thing, I would thank God. I think family for sure. All my family right up to my grandchildren and friends. I this so many friends have been a tremendous help over the years. And that's. That's it. That's it.
01:02:51:22 - 01:02:52:05
Paul Sullivan
Yeah.
01:02:52:20 - 01:03:17:21
Todd Sullivan
That's great. That's great. Yeah. Pop, thanks for telling this story, because I've heard it in bits and pieces over the years and there are so many amazing stories about just fighting through adversity to build something, knowing when to say, Hey, I got to make the next move, right? Hedge your bets, take some money off the table, live to fight another day.
01:03:17:21 - 01:03:42:20
Todd Sullivan
And you know, I know when I always made the joke When in doubt, call it out. You've never liked that it was very black and white. I didn't like the joke. You didn't like that joke at all? Because, you know, truth was so important to you. And I and I remember this really the story that's pretty recent is that you go to all the Harvard Tennis games, tennis matches when you can.
01:03:42:20 - 01:04:15:09
Todd Sullivan
Right. And you were watching University of Michigan play Harvard at Harvard, and you saw a college tennis change quite a bit. Right. And the fair play may not be at the pinnacle of kind of in tennis history. And the tennis has had to change rules in order to to come at this behavior. And you saw a michigan player call a ball out and then correct himself.
01:04:15:12 - 01:04:36:00
Todd Sullivan
Right. And and it was a critical point. And this Michigan player says, you know, I'm sorry, that ball was in and gives the point to the Harvard player and it's it's just a few points before this match is over. And it's very, very close. Right. Maybe. Can you Yeah, Can you can you maybe recount that story a little bit.
01:04:37:05 - 01:05:04:06
Paul Sullivan
Anyway, the how were a great match and it was in the third set and it was like two points away from winning the match. The Michigan guy was up and he was up two points from winning. And this ball was hit by a Harvard guy and he hit the line. The Michigan thought it was out. He called it out and they looked at and he said, oh, turned the umpire into the kid.
01:05:04:12 - 01:05:09:01
Paul Sullivan
The other guy, I'm sorry, that ball was in. That's your point. And the umpire.
01:05:09:01 - 01:05:11:23
Todd Sullivan
Agreed with him, right, that he called it out. The umpire agreed with. Yeah.
01:05:12:07 - 01:05:41:00
Paul Sullivan
Yeah. The he lost that gave the point and then he ended up losing, which is incredible. I think we're in the tiebreaker. And so it's I was totally impressed. I was so refreshing to see someone like that. MM. I end up getting his email address, I guess it was an address or something and I wrote him a letter and I thought it was just worth congratulating him on.
01:05:41:00 - 01:05:44:20
Paul Sullivan
And something that was far more important than winning a match.
01:05:46:03 - 01:06:15:18
Todd Sullivan
Yeah. And I remember, you know, you wrote this letter that equated him to these, you know, really professional players of the past, right? That had real honor. And you ended up giving him one of your original tennis rackets that you played with back in 1967, right? Yeah. And along with that note. So I think to me, that was a really more recent example of how you lived your business life.
01:06:15:18 - 01:06:42:11
Todd Sullivan
And in personal life, like what is right is right was wrong, is wrong. So yeah, well, thank you for going down memory lane again. I hope people enjoy this. There's so many good stories that we we didn't get to, but the business career was fantastic in the M&A stories and licensing. It's all things that I learned a ton from and, you know, have been able to take pieces of, you know, over the years for myself.
01:06:42:11 - 01:06:43:04
Todd Sullivan
So thank you.
01:06:44:00 - 01:06:44:12
Paul Sullivan
Thank you.
01:06:44:12 - 01:07:08:20
Todd Sullivan
But thanks again for listening to the Cashing Out podcast. For more founder exits stories, please subscribe to the Cashing Out podcast on Apple iTunes, Spotify, or wherever you listen to your favorite podcasts. And please remember ex it was dot com and the Cashing Out podcast are for entertainment purposes only. This should not be relied upon as the basis for investment decisions.