Ben Gilbert: recommendation

Transcript context

…I don't know for sure but they may not have. There had been some secondaries along the way. So I believe some of the money from some of the later rounds was secondary sales that the founders and management team were taking money off the table. So I actually don’t know in this case whether Nestle paid out anything to any of the employees. Well, I will say, you know, as I for lots and lots of reasons believe that full acquisitions are better than these sort of majority buyouts, particularly for startups like this, I mean they’re 40-store retail location, but early-ish mid-stage company. But if you're going to do it in this manner where you're not acquiring the entire company, I love the idea of it running independently and the founders still having a ton of skin in the game to make this thing grow in valuation. There’s sort of an interesting thing of like it has to stay a separate company. Think about this. How if you're those founders do you think about how your shares get valued now? Like there’s not really a competitive market to do the next round. Like there’s not a market to value your company. And it’s certainly not anywhere near getting valued on a reasonable sort of price to earnings ratio. So are you hoping that at some point Nestle just decides to buy you out? Is it actually in their best interest to do that? I love the incentive. I’m curious on the mechanics of how that works. I think you're hitting on all the right questions here, Ben. I think part of the reason this happened as it did is, I have to wonder. I don't know anybody at Blue Bottle personally, but Freeman and Bryan Meehan who’s the CEO, he came in and took over as CEO a number of years ago. But Freeman is still very, very involved. They both were very vocal about saying they never wanted to go public. They didn’t think being public made sense for Blue Bottle as a company and it also just was something they weren’t interested in. And yet, the company continued to grow but at the same time did raise all this money and in particular, in some of these later rounds, bringing in folks like Fidelity. Fidelity is a mutual fund. They’re a public company investor. They want to return. All the investors want to return but particularly them and they want liquidity. And so I can only imagine the tension that must have been building as they were making these decisions to take these partners on along the way, these partners as investors who just had sort of fundamentally different goals than what it sounds like James and the team did.…

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