The VIP Seat: Good morning and welcome back to the VIP seat. We have a very exciting couple guests here this morning, Kenny Dicter and Robert Withers from Real SLX. Sit back, buckle up, and let's take off. Kenny, Robert, thanks for joining us on the VIP seat. I'm ⁓ very excited about this conversation that we're gonna have. Well, we're excited to be here. There's no seat like the VIP seat. And we sincerely appreciate what you guys do for the industry. It's been a great breath of fresh air and it's been really educational. It's something that we can't recommend highly enough for people at all levels of the private aviation industry. And we are, Robert and I are First Amendment people. So the free flow of information and That's right. You know, being able to have a conversation like this is important. And, you know, full disclosure, obviously you guys are our new sponsors, ⁓ kicking off this episode, but that's not gonna hold us back from having an authentic conversation, ⁓ about what everybody wants to know in this industry. So Yeah, and I would say for us, ⁓ it's really about getting behind a platform that is covering the industry in a very fair and balanced way. So I would say sponsorship might be the, you know, sort of the working word, but it's more of an investment, ⁓ In and and and the it's a partnership. It's a bar it's a it's a partnership. Yeah. It's a partnership. We try and have a show that is important to the industry. ⁓ and what both of you have built has been important to the industry too. So it's you it's it's definitely alignment. I think where we should start, and because this is an industry podcast and designated to industry people, I think if we can get a 90-second in case anybody's lived under a rock for the last twenty six years. Give us, you know, kind of the ninety second background. Kenny, Robert, you know, how'd how'd we get here? You know, your background in aviation. Well, Robert's like a brother to me. So let's start with two pairs of brothers. In December on December seventeenth, ⁓ nineteen ⁓ three, Orville and Wilbur. ⁓ they were in ⁓ Kitty Hawk, North Carolina. Everybody told them they couldn't do it. It was ⁓ second or third summer of trying to get the right flyer up and ⁓ On that day they got it done. So I don't think any of us would be sitting here if ⁓ if not for Orville and Wilbur Wright of Dayton, Ohio. Which is not that long ago. Like that's not that long ago in the grand scheme of things. We had fire how long ago? Yeah, but let let's go forward eighty-three years to somebody who had some fundamental impact on my career and ⁓ ultimately Robert's career. Another pair of brothers, Vincent and Richard Santulli, who ⁓ in nineteen eighty six, after buying executive jet. in ⁓ eighty four, ⁓ came up with the NetJet program and Rich really was the ⁓ you know, the lead on that, Vince there ⁓ at every step. ⁓ but if not for fractional jet ownership and Rich was a former Goldman Sachs mathematici mathematician, ⁓ I think he could have been a math professor, but he ran their leasing department there and he figured it all out. So ⁓ we're lucky enough to touch the people that really birthed this industry. Yeah, and your connection with them, right, is from the first from the first round. A lot of people know you from wheels up, but that was from Marquee Jet. That was from even even before any of that. It's like 2001, Kenny and Jesse Itzer started Marquee Jet. I was fortunate to join them as the young guy at the table a year or so later and it was a tremendous run. Yeah, it was ⁓ a special run. It's proof that anything is possible in America. You know, Robert Withers and I getting in business with the Santuly brothers. ⁓ with Warren Buffett, who famously was a a customer of NetJet. ⁓ Richard convinced him, ⁓ probably didn't take too much convincing because it was more efficient. Warren's one of the more efficient guys out there. ⁓ he got Warren to sell his two two jet planes and ⁓ become a fractional owner in nineteen ninety eight. The indefensibles in nineteen ninety-six ⁓ and nineteen ninety-eight. He called Richard and said, ⁓ Loved the business so much. ⁓ he wanted to entertain buying it if Richard were interested in selling it to Berkshire. The rest is history, nineteen ninety-eight. So two thousand one, you guys had the idea that Yeah, it was really two thousand, summer of two thousand, after taking four or five private flights. Sounds like a song. Summer of two thousand, you know, it's like we were sitting there. summer of two thousand. I don't think we saw a deadhead sticker on a Cadillac, did we? No, I know I know what you're talking about. Okay. Boys of summer. Just for for for trademark purposes there, IT. So ⁓ summer of 2000, ⁓ Jesse Itzler, my partner, ⁓ a few other like sort of co founders came together after Jesse and I had experienced five or six private flights with at our time ⁓ w was Our mentor Bob Sillerman, who bought our first company, Alphabet City, in nineteen ninety-eight. ⁓ so it was somewhere in between ninety-eight and two thousand that we quickly found out that flying privately was better than flying commercially. And ⁓ prior to to being in the private aviation space, ⁓ we were in sports, music, and marketing. And when Bob Sillerman put together SFX Entertainment, which became Live Nation, ⁓ so we were at the The formation we were we were at the Big Bang of Live Nation, which became ⁓ you know, a global ⁓ beam beamath in ⁓ live entertainment. After five flights, we were hooked. Five six, we were hooked. I heard that you put on a suit just for Warren Buffett and there's a Coca-Cola connection that you did in some other view that I thought was a great analogy for Marquis. I would say this. ⁓ you know, anybody like Robert, myself, Any of the great salespeople that this industry has. You know, you start selling when somebody says no. If not, you're just an order taker. ⁓ so in the summer of two thousand we got connected to Rich and his partner Jim Jacobs. That was Jesse and I, one year before. Robert was probably still graduating high school or college at the time. He was a young man back then. But we ⁓ we went on to ⁓ to get to meet Richard and his partner Jimmy. And we had six or seven meetings. I don't want to say we were thrown out six or seven times, but we they didn't want to move forward with our idea, which was to create a bite size of NetJet, a twenty five hour card, which in effect was a short term lease ⁓ on NetJet. It was a sub lease, if you will. ⁓ So a little bit less than a quarter share. Right. The QS was quarter share. How do you get less than a quarter share? It was quarter share or it was quality service. ⁓ Probably both. Right. But ⁓ so the quarter share is two hundred. It was the l the smallest share you could buy was a sixteenth of any given aircraft that they were selling at that point in time, which gave you the right to fifty hours a year. Now there are a couple of things that if you're a high cash flow person or new to the industry. Yeah, to make a five year commitment. So it's a two hundred fifty hour commitment over five years. You have residual risk. I would say that airplanes typically don't rise in value. So you're you're gonna get they do these days just for didn't use that. I think you look the depreciation play certain corporations, it makes incredible sense. But we felt that there was a a much wider part of the pyramid that could be covered by the ⁓ the marquee jet card concept that we were pitching Rich and Jimmy. And you're referring to this crazy story that February ⁓ one, ⁓ when Rich said, Come out to my office, it was in Woodbridge, New Jersey. ⁓ he called us and said, Make sure you two guys are in suits. So I said to Jesse, I know you have a suit because I saw you wear one like for a family wedding. I said, I gotta figure out what I'm gonna do and I ended up buying a suit ⁓ for the meeting. And ⁓ when I walked in unbeknownst to Jesse and I, ⁓ Jimmy, Rich, and the Oracle of Omaha, ⁓ Warren was there. And ⁓ Rich said to to me and said to Jesse, he said, pitch our marquee jet idea. So we had taken a lot of notes ⁓ on what Richard thought this program could look like. So we were we were moving the ball, just not in the end zone yet. And ⁓ Warren's there. He said, Why don't you let Warren know a little bit about Our marquee jet card concept and you know, a guy from Eric, low SAT, low GPA sitting across from the Oracle of Omaha. No pressure. I wouldn't say that, but I would say y you know, we had a good idea of what we wanted to do. And one thing I'd say about Warren, you know, we still have a a relationship today. I saw him at the C N B C ⁓ thirtieth anniversary of Squawk Box a few months ago. He's still roll rolling big. Yeah, yeah. And ⁓ I would say, you know, we gave him the quick pitch, and you're referring to the, you know, how he explained it to Warren. And it was simple. ⁓ he was at that time a board member and a big shareholder of Coca Cola. And a big consumer too, right? I think he consumes a lot of it too. By the way, he does. Regular Coke, cherry coke, never diet coke. So he's right. And ⁓ he also consumed a lot of dairy queen. And guess what? You know, so he picked that one up too. so I would say very simply we explained to Warren and asked him a question, how much is that two liter bottle? We were already in liters, so it's ⁓ two thousand ⁓ one, February two thousand one. I said, How much is a two liter bottle at Kroger or Safeway or any of the big supermarkets? He said, That's easy. It's either a dollar nine or a dollar thirty nine, a dollar fifty nine, depending upon what the promotion was or or you know, what they were doing. If it was on an NCAP, it could be, you know, towards the lower end of that range. So I said, if we walked across the street to seven eleven, got some gas there, and we went in the shop, I said, how much would a can of Coke be? So everybody knows that's a dollar. So sixty seven ounces was a little more than a dollar. A twelve ounce Very convenient can, the same price. Better margin. I said, that's how we wanna that's what we wanna do for NetJet. Not everybody's ready for a two liter bottle of Coke. A lot of people want bite size and then they walk away. ⁓ so that was the analogy. He said, Rich, why don't you just explain it that way? And ⁓ sure enough, his hand went out, Richard's hand went out, Jesse's hand went out, Jimmy and ⁓ Rich said, We're in business. Let's go. So you s so you started it, it was a independent company, but you were selling into NetJet. So you were your own technically owned company or technically we're we were a value added reseller. Yeah. You see that all over the place with technology and with computers. ⁓ we were a value added reseller of NetJet. The value was that it was bite size. Yeah. Twenty five hour bites. And it became a great growth engine for people moving up. And laddering up into net jet shares. It was healthy for everybody. It was our first attempt at democratization. We didn't know it at the time what it was. But ⁓ as Robert said, it was really what it ended up being and what it is today, is a customer acquisition vehicle ⁓ for people to move up the chain and and ultimately become fractional ⁓ owners. And all all the fractional players do this now. I mean this is now not every that that was a revolutionary idea. So yeah, I think they you know the fractional players originally followed Richard into the fractional model. Yeah. And then when we got into business, it didn't occur to everybody ⁓ so quickly. You know, we did have get a good head start on everybody, but it was citation shares at the time, it surely was Ken Ricky, ⁓ Thomas Floor and his company were just coming onto the scene. But we surely got that twenty-five hour card established. ⁓ you know, first mover advantage for all you young people out there. It's real. Yeah. You know, one of the really cool things, people talk a lot about Marquee. There's a period afterwards where not a lot of people have told the story, but Kenny had a couple of partners that both came from the beverage background. And at the tail end of Marquee, they came up with a concept for a tequila. ⁓ that became known as Avion Tequila. Avion Spanish and French airplane. Yep. ⁓ and that was a really great win. Give the 30 seconds on that because that was a great interim win. This is a lot of this is post sale. Right. Well he he after Marquee. Okay. After Marquee. So Marquee, just to tie up Marquee, is we became a significant player in the NetJet product mix, both in Europe. We started Europe in 2003. We sold it to them in 2004 And in America. And it really, like I said, you think about Mercedes, their entry level. I guess it w used to be the one ninety E. E every company that does something in the, you know, sort of the the the the higher end always has an entry level. If you want to play with Louis Vuitton, you can always get a keychain or a wallet, right? I mean so I we we we we we created a vehicle where people could touch that brand. And I would say, you know, Robert mentioned it before, eighty to ninety percent. of NetJet's customer base today. Probably spend a little time in the marquee program. And then once you retire, if you're working and you're using your NetJet chair, you know, 150 hours a year, you might come back down to to the company's not paying for it. It's coming at your own back. To the 25 hour level. But as Robert said, somewhere towards the end before we sold the business in to ⁓ to NetJet, which was 2010, ⁓ Ken Austin, who was our chief marketing officer ⁓ who had some background at Seagram's had an idea for a vodka that we wanted to call jet. But then we looked at the vodka market. It was a very, very tough market. Which everybody's in in alcohol right now. Yeah. Like every celebrity that you know, like that that was 2010 was early for we we w we were early and Ken had a vision. You know, I I said I will investment Bank it and I'll I'll help you market it. Ken went on to run it full out and ⁓ We ended up getting it out there in a in a major way. I think we went into the we got ourselves into the top five of premium tequilas. And sure enough, the second largest ⁓ liquor company globally, ⁓ Perno Ricard came in as our partner and ultimately bought the business. I would say a nice clean exit. Nice clean exit. And we also had a very nice in in in two thousand ten when when Marquee and NetJet came together, which it absolutely should have. at that point in time. ⁓ just great to get a brand launched and you know, have a successful, you know, live on without you. Well, and was that your first experience with capital markets institutional? You know, d when did you start learning how to work in those works? I learned it from the best of the best. And this was in nineteen ninety eight, ⁓ when we sold Alphabet City to SFX Entertainment. Okay. Bob Sillerman, God rest his soul, died a little bit too early at seventy one a few years ago. ⁓ Bob was one of the best capital markets people I ever met. ⁓ SFX Entertainment, he put it together for two point two billion, sold it two, three years later for four point four. Do the math. That's ⁓ you know. Bob became a billionaire that day, got on the Forbes list, and ⁓ we were as close as we are to you. It was Jesse over here, Kenny here and ⁓ and Bob. Bob really took us under his wing. So that's where we got a little bit of the capital markets bug. Interesting. And then, you know During that period with Avion, of course there was a lot of tequila being consumed. And so Kenny and Mark DeCher and a couple of other folks had a really good idea to help a budding entrepreneur here in the city with a brand called Juice Press. We used to joke that it was our natural hedge. You had tequila on one side and all green drink nighttime drink in the next morning. Tell a little bit about that. We we would say late nights early flights. And you surely wanted to have ⁓ you surely want to have ⁓ some green juice and You know, in Robert's case, a little bit more citrus ⁓ to the mix, a little watermelon, but I went for the hardcore green and ⁓ you know, we put our money where our mouths were and we invested in this very young entrepreneur who was ⁓ putting up a company called Juice Press, Mark De Sheira. I think he may be a congressman coming up, right? ⁓ in the in the running in Texas, yeah. This is our former first baseman by the New York Yankees, who was one of our founding investors. Kenny Langone, legend, living legend. He ⁓ created Home Depot and a lot of other things in the ⁓ the the biomed space. ⁓ also a great mentor. ⁓ Ken came in with us and we we backed ⁓ an entrepreneur. We built a company, it went up to 80 stores and ⁓ we exited that business, ⁓ private equity, ⁓ entrepreneurial hedge fund. ⁓ came in there and really took it next level. ⁓ and actually it's still rolling today. And ⁓ one of my favorite Kenny stories though is that when we made the investment in Juice Press We decided really had to get to know the product. Hold on. First off, Robert, let's disclose this might have been your first personal private equity event. It may have been. This is this is hurry up and wait. Totally. Yeah. So we decided we needed to get to know the product. So Kenny and I, I think I was just married or engaged or something like that. We decided to do a juice cleanse. And like everything Kenny does, you can't halfway do it. So he did sixty-one days of all green juice. I did A ⁓ contested thirty-nine days. Modified modified thirty-nine to some Robert interpreted the cleanse. I went hardcore. It was all liquid. I lost twenty-five pounds. It was Mongero before Mongero, you know, seeing through walls, writing symphony, all this other stuff. Robert, you know, like I said, he's been my my my my left, my right hand at all different times. He went in and said, If you're going on a cleanse, I'm going. And what Robert You know, everybody can interpret rules their own way. We started seeing or people started letting me know that there were cashews, juice press cashews in Robert's garbage at work. Right. So I said to Robert, no, no, I said to Robert, I said, Are you on a juice cleanse? Or he said, No, I thought it was just anything in the store. So, you know, there there was a by the way, it's still under review. Yes. We're we're not sure. I would say that Robert went on a thirty nine day for sure non-processed journey. Non processed food. So I kept saying myself, why am I losing more than Robert? But you know, sure enough, the cashews had a little bit of candy coating. It was natural. But ⁓ I'll tell you what, he went thirty-nine days he did only, it was ⁓ verified. That he did only go to juice press. But when with when they went back, the way we kind of understood what was going on, and then Robert, of course, spoke to it is there were cameras in the store. And ⁓ you know I had to fess up. Yeah. He had to fess up. When confronted with the cashews in a bag, you know, he couldn't say that Carter was eating ⁓ because she might have had a nut allergy or something. But ⁓ you know, it led to a great period and it really led us to looking at different business models, including the luxury real estate space, which introduced us to the membership model. Okay, Kenny. So the thing that everybody wants to know, when did you decide to build a billion dollar company ⁓ or more? The Unicorn, you when did that ⁓ that strike you? Well, if you go back to Marquee Jet, the only constraint we had ⁓ on on on getting to a billion dollars the top line was the constraint that we were exclusive both ways with NetJet. So I would say left to our own brothers, we might have hit a billion in revenue ⁓ over there. But ⁓ the good news was we protected Thanksgiving and Christmas and Easter and Passover and everything else. So we we were very judicious and mindful of how much we could sell. But I would say there was more to sell and we kept it scarce ⁓ there. At Wheels Hub we had a different idea. We wanted to further democratize the space. We wanted to Make the addressable market bigger and even make it simpler to join if it's possible. And less commitment, if you will, ⁓ membership model. ⁓ and and ⁓ we knew if we did that and executed on it right, we can get to a billion dollars both in top line and in valuation. And ⁓ I would say the ⁓ the end of the story is we check those two boxes. Yeah. So the whole idea was recurring revenue, subscription revenue, and then margin enough on top. Yes. Right. Like that was it was but it wasn't it wasn't these big, you know, big frothy margins. It was it was pretty tight margins. Yeah. It was ⁓ listen, it's ⁓ it's it's a model that's incredible. ⁓ it's called the subscription commerce model. ⁓ Amazon Prime. You pay your hundred and fifty dollars a year to pay and get the deals and you know whatnot. ⁓ you look at Costco at fifty dollars a year. I would say they have a one to two percent margin in the store, but fifty dollars times ⁓ you know, ⁓ tens of millions of people, that's their business. So ⁓ yeah, the the idea was to set up a subscription commerce model that made people feel like true members, true community members. And ⁓ you know, to my left I had a guy that did every single job that was possible at Wheels Up from co-running the sales ⁓ as it got bigger being the COO of the sales group was always in there to ⁓ to help operationally, ⁓ work very closely with our partners, whether it be Gamma Aviation or Mountain before we took them in. So Robert I think he got his ⁓ his his master's degree in aviation ⁓ bopping around. ⁓ Wheels up. How do you sell that much? I mean, you got the the the hockey puck or the hockey stick growth was there. Like how did you sell so much? It's all about the people. And you it's fun to reminis in the conversation we had a few minutes ago, but the coolest thing to me is the people that are in this business. And the most fun part is the people that flew with us at Marquee, that were investors in Avion, that were wheels up members early on and are real jack customers today. Like relationship capital is so important in the world and that's something that we've been able to have a lot of success with. Yeah, and it's amazing to see, you know, when you have people that come up through your, you know, I'll call it our farm system and become stars. You know, Robert's one of a handful of partners that were younger, ⁓ ambitious, ⁓ they bought into our culture and now they're you know, they're running things, you know. I mean I'm I'm I'm a good chairman in that I could ⁓ you know, every day if I don't send a few things over to Robert, he does hit me, make sure that I'm ⁓ you know, he's still my sales manager. But ⁓ you know, look, wheels up, we had a great run. ⁓ we got the business off in two thousand thirteen after all non-competes were burned off and all tequila was already consumed. So you know, and the green juice was very helpful there as well. The natural hedge. But ⁓ you know, two thousand twenty two we ⁓ we we printed the biggest year ⁓ that I think anybody in anything close to what our model look like, which was ⁓ enhanced charter in a way, a little bit programmatic, definitely a subscription commerce model. And ⁓ 2022 was the pinnacle as a public company, we printed 1.585 billion dollars in top line, which ⁓ I would say at one out of every 10, one and a half, two out of every 10 flights taking off might have been In the charter micro ⁓ might have been us. Yeah, I think the things that I'm most proud of are number one, the retention rate. People early on especially stayed with us. I think number two, the thing that is ⁓ probably most misunderstood from that wheels up run is the job Kenny and the crew did on the marketing side, Gary Spitalnik, Carter, others. You know, we made a lot. We made a little seem like a lot. And people always overestimated how much we were spending. We see some of the stuff that's being spent out there in the market now. And, you know, we know we were a fraction of that even at the one point five billion dollar mark. And I think if there's any power that our group really has, it's that marketing ability to really scale it a big way without spending a lot. Well, I would say this if you th think about branded sneakers or luxury goods, you might have twenty, twenty five, thirty percent of the the price of the item. being spent back in marketing. I can tell you ⁓ that we never spend more than two percent ⁓ at peak on marketing. So that's a very reasonable reasonable spend. Well as you said the margins aren't ⁓ you know we didn't have air Jordan margins. Exactly. I I I I I don't want to skip over a very important part of what you were just talking about on the timeline is going public and spacking And and in hindsight, people can point a lot of fingers and they can have a lot of opinions. But the reality is, is that there was nobody else that was brave enough, bold enough doing it to go public. I mean, you guys were really early in that journey and really got our industry on the map. Like can you walk us through Well, I would say someone had to break the four minute mile. Yeah, exactly. Well, I would say, you know, we were fortunate to have great partners all the way through. I think back to the starting of Wheels Up, which really was on the tenth floor at Jeffries with Nick Fazzioli and others. I know he was a a great guest on this show, but the role of the capital markets and the role of the investors throughout leading up to that point, you know, we were always fortunate to have great teammates that helped us along the way. I I I would add that ⁓ look Wall Street never truly put its arm around the private aviation space. And I'm including the OEMs, conglomerates, General Dynamics has Gulfstream and you know, Textron, ⁓ you can call ⁓ a helicopter, a defense. Well, NetJets is buried so deeply inside of Berkshire that it's, you know, yes, you get exposure, but it's not as you know. Well, I I would say look, NetJets for Warren. That was instead of him buying the Dallas Cowboys, he bought that jet. You know, that was ⁓ definitely not a straight down the middle of the fairway purchase for him. But I think he loved what Rich built. And I think Warren is the ultimate people person. I think it was about the relationships. It was about how Rich, who we still till today, we always talk about Rich and and how he cared for people. And I'll tell you our business plan all the way through and it's still ⁓ today. Dr. Maya Angelou, she said, It's not what you do, it's not what you say, it's how you make people feel. And we figured out how to translate that into a ninety percent ⁓ retention rate for twenty six years and and even still today. So So I think, you know, the question that everyone's gonna be asking watching this show, the naysayers out there say, Okay, you know, you can you can market and you can build, but can you deliver returns? You know, and I think some of it's the spec, some of it is the fleet decisions. I think when you look back on the whole journey, you know, what did you do right? And what are the things you could have done differently? Well, there's always learning. I think if we're sitting here today, ⁓ and the company is still public, ⁓ it's do it's doing well, the stock will follow the performance. I think they got the right plan in place and the right management in place. And again, they have that bastion. I mean, if you think about what Delta has, two hundred million people flying in in in the United States or in North America, and six hundred million people if you count the alliance. You have all the customers, both business and individuals, that you need. It's just a matter of getting that rhythm together. ⁓ and it's taken new management a few years. But, you know, I'm a big believer in wheels up. I feel like I'm as passionate about it as Robert is about Boston College and Yale, where he went to college and ⁓ and and and how I feel about Wisconsin. I want wheels up to win. And ⁓ you know, as far as naysayers go. You know, when Michael Jordan came into an arena or ⁓ you know, LeBron James comes into an arena, if you're not getting booed, you're not valuable. Yeah. So ⁓ you know, I think that ⁓ you know, we we take it as a compliment that people in the industry have ⁓ taken some shots. And there's some great lesson learned along the way. You know, some of it had to do with timing coming out of covet. Those were really difficult times. I mean, we were working closely together at that point trying to predict demand patterns coming in and out of COVID. I mean, it was a little bit like you had aggregated so much demand. I mean it's like there probably was there anybody else who had that much demand during that time? Like you were moving the whole market? Well we our our philosophy at that point in time, and it's easy to look ⁓ back and you know, armchair quarterback it ⁓ we felt if we had that demand captured and we could keep that demand happy, you know, spending a couple of hundred million dollars, which I don't want to sound cavalier about, you're gonna build some incredible franchise value. And look, Wall Street, that's ⁓ there's there's no there's no fudging the numbers. They're real numbers. You know, we raised money at fifty nine point five million dollars and we went public at over two billion. So we create a lot of value for a lot of people. And ⁓ I think in time Growth was not only rewarded, but it was gold star rewarded ⁓ when we went public. Then it became very quickly with COVID that ⁓ people wanted earnings. Tough to move that chip. And I think that again, what's ⁓ current management looking to do here is is right size. And then again, I I know Ed Bastion, he doesn't run businesses or have businesses that don't have growth potential. So I think that ⁓ You know, to me wheels up has a as a great, you know, sort of future forward. And Robert and I are both rooting for it. We have a lot of friends there, a lot of customers there. It's still your baby. It's still our baby. Yeah, even though you're it I I f I f I feel that as a former entrepreneur as well. There's you you you hand it to someone else sometimes and it's not what you left as well. When you see those phenobs in blue and white now. I know. Yeah. Yeah. That's a No, I think, you know, for me the biggest lessons really fall into Two categories. Number one, we've talked a couple of times about the people, but there were some challenging days and making sure that to the extent we could we continued to take care of the people is something that Kenny always preached anytime we needed it. And it really percolated throughout the entire organization. And then I think, you know, in terms of the other lesson learned, the biggest takeaway I'll have is if you believe strongly in something, just go ahead and do it. Because we were there in COVID. We had the multiple certificates, we kind of knew in our not kind of, we knew in our hearts that it was time just to rip the band aid and integrate. And if we'd been able to do it then, who knows what would have happened. But we wouldn't be here today without the experiences we've had. I think that's probably the thing that stands out to me is I'd also say too, if you look at any of the big scale companies that are tech enabled and consumer based, Amazon twelve, fifteen years before they became profitable. How about Spotify? Asset light, but they're building, they're building, they're building. So I think that in our space, ⁓ Wall Street probably didn't have the same patience, if you will. I was gonna ask, like was was the retail consumer and an and to institutional investor ready for the amount of money it was gonna cost to run airplanes? Well I I th I think all roads led ⁓ to what we had at Berkshire Hathaway, which is an incredibly established ⁓ firm in Berkshire, a netjet, you know, incredibly established, owned by Berkshire. That's when ⁓ Entered Bastion, you know, in two thousand twenty, two thousand twenty-one, we said we gotta find somebody who really is a great operator to allow us to do what we do best. But also has the long term vision. Right. Warren is known for his, you know, yes, he wants returns, but he also can see a lot longer than Many people. That's been his that's been. I'll tell you something. Warren said he was never gonna invest back in the aviation business, back in commercial, go in in COVID when he took his positions down in the four majors. Sure enough, he's got four point six percent of Delta today. Yep. So I would say that never say never. When we finished that first Delta Private Jet meeting down at Delta headquarters and Kenny and I and our CFO at the time Eric Jacobs sat across from Go West, now the CEO of Hertz and Ed Bastion. ⁓ you know, sitting in that big conference room as a an av geek like me, it kind of felt like you were at the cathedral of aviation down there. But Ed had a great line that only he could drop. He looked across the table at us and he said, Let's go on a learning journey together. Mm-hmm. And that's how we finished the meeting. And, you know, when you look back, it really was a very strong learning journey. And and I think for Delta, you know, you place your your baby ⁓ where he or she or they or them belong. ⁓ you know, Ed's vision from day one was main cabin, little extra legroom, let's take it up to business. Then we go to ⁓ you know, first class and then Delta One. If you want to keep everybody in that ecosphere, just like Apple, you know, all these different things that keep you in their their ecosphere. Private jet wheels up was ⁓ the one up from Delta One. And I tell you, I think that they're very, very well positioned. And Delta's very, very strong. And you Well, they got the Grandview fleet now. Exactly. If you don't have the Grandview fleet, right. Like I said. And I'll say this, Delta did lend some great talent along the way. Kenny and I were so fortunate to have Dave Holtz come in and, you know, really help us from the get go in the project. He had been ⁓ a big part of Delta's flight operation for more than 40 years and still remains a great friend to us both, and one of the most talented aviation people that I've ever been associated with. Still there today at Wheels Up. So now Wall Street's finally paying attention to private aviation. Who's doing it right? Who's doing it wrong? Thoughts. I'll take the first ⁓ shot here. Wait one second. This is ⁓ not. investment advice. ⁓ Consult your yada yada. You know, this is all that all that good disclosures. Anyway, sorry. This is personal opinion, first amendment. Exactly. I I would say, look, I'm biased. Who does it right? NetJet does it right. You know, we were a a very, I think, ⁓ integral at that point in time part of ⁓ what NetJet became globally. And today I know that the ⁓ the twenty five hour product ⁓ is is super important to the base there. But they have the capital, they have the experience, they have the the first mover advantage, Rich and and Vincent Santulli, nineteen eighty six. I think it's that shit. ⁓ you know, surely Ken Rickey ⁓ has has run a great play in his own right with the multi brand, multi entry points into the supply chain. Mark Burns. I mean Mar Mark Burns at at Gulfstream, you know. The guy ran maintenance, which is the best thing you could ever do, the best background ⁓ you could ever have to become president. And ⁓ you know, I think, you know, in a lot of ways this Gulf Stream and everybody else, but Bombardier A Bombardier is a great run. you know, we love the sow. You you know, we still when we see a King Air, you know, we think about Beechcraft, ⁓ which became Cessna and then of course our great friend Michael Amalfitano. That's right. ⁓ you know, everywhere. He's doing it. Yeah, he's doing it right. So I think there's a lot of people doing it right. ⁓ because I don't want to give Robert the whole who's not doing it right. I'll tell you who's not doing it right. The people that don't value safety because you are the ultimate fiduciary. Yeah. ⁓ and everybody out there that is trying to make an extra thousand dollars on a flight versus have the right crew and the right time, don't do it. ⁓ Robert and I have been stewards of people's capital, but more important, stewards of their safety, millions of flights taken off. I it's I would say this. I'll get more specific. ⁓ if you're a customer, you have to beware of somebody who's sitting, you think they're at the same side of the table as you are. You need an honest broker community. And if you have honest brokers, you're gonna get the right plane, the right time. Yeah. You know, we want to take that next level and go yard. On ⁓ you know, being the the most trusted broker in the room and who has that relationship, what platforms? We know we we're looking up our our North Star, Sotheby's, Christie's, you wanna move a a hundred million dollar painting, they'll they'll match the buyer and the seller for you. Goldman Goldman Sachs, assets under management. We're fiduciaries and again, our brand has to mean Safety, it has to mean trust. And those are the first two, three, four things we can just safety trust, safety, you know, the that's what matters. And again, we've been lucky enough, Rob, we get a knock on this wood here at millions of flights take off and ⁓ the same amount of flights that have landed. Yeah. Jesse, you and I have talked a lot about gray charter and the role that it plays in our industry. I would say there's a cost to doing things right if there's anything that gets under my skin. It's the people to Kenny's point that cut the corners that aren't playing by the same set of rules. I'm never a fan of big government, the political science major that I was, but I will say, you know, if there's anything I would want the government to get more involved in, it is to crack down. We see it every day. We're in the Atlanta market. It's very present there. And then I would say secondly So Rob, you're talking about FA and DOT. Yeah, I'm talking about the illegal charter, the gray charter that's I mean Mark Babert Aero Centers has the great term 134 and a half. Yeah. Exactly. He uses that term. But I also think there's a couple of 133s out there. There are too. I also think that, you know, for some of the people that are out there putting these big pie in the sky numbers, you know, we know how hard it is to hit a billion five. I would say It is not yeah, it is not like a five year twenty thirteen. It didn't start in twenty thirteen. No, it started years before that. But I was eight, nine years later. Yeah. Well that way back. Yeah. It's twenty six years ⁓ now. You know, be happy where you are, enjoy the process because we see some of those numbers and you know, Kenny will pick up the phone and call me or I'll call him. ⁓ that stuff doesn't happen in three, four years, that's for sure. Yeah. Well, private equity flo would love for that to happen, but that's not just how reality works out. I would say also, you know, one of the things Robert and I were discussing to prepare for this is the small operator out there that I know is a big part of the audience. The small operator does not have the marketing and the the flash. But I'll tell every small operator out there, if you deliver great service, the man will find you. And that's from the biggest platforms. To the folks like us at Real, deliver it right, deliver it safe, deliver it with quality. That's your ⁓ that's your marketing. Yeah, and don't and don't bring your prices down just because Joe Schmoe is, you know, you're supposed to stand on quality. A hundred percent and you'll find the the right demand, not just demand. You'll f and that's coming from the demand king himself. And that's not me trying to blow smoke up your butt. But it's true. It's a billion and a half dollars of demand, right, that you have Hold on one dollar at a time. Yeah, yeah. And we had a tremendous sales team. In fact, we're fortunate a lot of those folks or some of them have come with us now, but it wasn't Kenny and it was a great team of really, really talented. One person can't post those numbers, but I would tell you that ⁓ you know, I told Robert, you know, I've been out haven't spoken to press a ton about where this is going. We're privately held, we're enjoying being privately held. ⁓ You know, again, right. Well we're making this we're making decisions for one year, three years, five years out. That's an advantage of being private. Sometimes Wall Street wants to know 90 days from now what what's gonna happen or what's happening, and the play sometimes takes a little bit more time to develop. But I'll go on record here. ⁓ we've been out in the media a little bit. People say, How how big do you want to make this one? And we've said five hundred million, seven fifty. Based on what I'm seeing with Robert and how we're setting the foundation up, this one can be a billion dollar top line as well. Okay. It's it's gonna be a different billion. It's gonna take a while to get there. Yeah, yeah. It's gonna be a different billion. But I think that ⁓ you know, the scale that the thousand, fifteen hundred operators allow us, ⁓ the number of airplanes out there, the number of high quality pilots and people in the in in the aviation space that we work in, which is the the premium space. I think that there is plenty of what we need ⁓ to to to drive a billion dollars is people that can deliver it. I'm not worried about I'm not worried about getting there. I'm worried about you know, like I said, I'm gonna look at Robert and say, Robert, you can deliver this? Yeah. I wanna get into real and and the other that it's not just an aviation company. But before we do, there's one last question I had on the wheels up story. And that is You know, the day you left your office. Did you go to the beach? What what what happened? I I I ultimately went to the beach. It was ten years from start. Yeah. It was May 9th, 2023. I remember very proudly ⁓ at earnings letting everybody know that I was gonna step away as chairman and and CEO of the company. And I think at every every company founder has to one day look in the mirror. And you talk to your board and you y you know, there's never a perfect time to to to step away. But the company was in good hands. And this was already post going public. You had Delta. I think changes needed to be made in terms of what the priorities were. We had to really focus on the margins. We had to focus on the fleets and this is stuff that ⁓ that that if I were hiring Kenny Dictor, I might not hire him for the back end. I'd hire him for the Friday. That's good self-reflection. The entrepreneur is not always the one that that runs it ⁓ when it's public. That's that's a common But there have been ongoing conversations for a while. And you know, Kenny, you were one of the first people to raise your hand and say, When it's not my time. Yeah, listen, you have to be able to as a founder, not hang on too long. And ⁓ that was the right time. And I think ⁓ you know, with Ed's support ⁓ and with the board's support, ⁓ I remained a a board member. ⁓ Always the founder. ⁓ but that was ⁓ that was a good day. I mean May ninth. I remember the day very well and ⁓ it was the right day. Yeah. Yeah. We we didn't hear for you f from you for a couple months after that, and then we did. Can you tell us a bit about that stuff? I g I'll give you a little bit there. ⁓ when you're the founder of a company, you're always the founder. I would say that At that point in time, we were facing a mini banking crisis that could have been a maxi banking crisis. And our model called for people putting money in up front. So Silicon Valley Bank, it just happened. Silicon was first republic. I mean, real hundred billion dollar, you know, banks, credit suites. Credit Suisse, signature bank. I mean big stuff. And I think the you know, sort of the tide, if you will, ⁓ if you were gonna do ⁓ or are you gonna run a business model our way, even with Delta behind you, you have to have a long runway. Cause look, people burn their cards off or their twenty five hours or the deposit off. It's usually 10, 11, 12 months that they're up in front of it. So if your sales ⁓ if your sales strategy is to continue that kind of, you know, packaging, then you have to have runway. People have to believe it's called good faith and credit. I learned that from the guy himself. The Oracle of Omaha, good faith and credit. You know, Walt Disney's ⁓ you know Walt Disney's ⁓ definition of a man or woman or somebody's net worth, it's not how much they have, it's how much they can borrow. So ⁓ you know, that we we we we needed to show the street. Yeah. We needed to show our customers and our future customers at that moment in time. An ongoing concern. An ongoing concern that that not only that, but had a little ⁓ more runway than you needed. Yeah. And when I left, the ⁓ the charge was to lengthen the runway. And I left that ⁓ with the board, of course. And ⁓ Robbie Tochran, who became the executive chairman, Todd Smith ⁓ stepped up from CFO to CFO and president, ⁓ acting CEO, if you will. We were in a search, and I ⁓ I wanna say I hit the beach, I hit Seattle. We did a Arrayos activation for Major League Baseball at All-Star weekend there. That was early July, and I promised my wife Shoshana I would take her to St. Bart's, ⁓ one of our favorite places. And ⁓ we ended up ⁓ at the Guadajani and ⁓ in Seattle I had gotten a call. This is early July, and I knew earnings were three months after my earn the my my my you know my exit, ⁓ which was May 9th. So I I knew in my head it was August ninth, tenth, eleventh, whatever it was. And ⁓ I got a call from somebody inside ⁓ Wheels Up and they said You know project length and the runway. I said, Yeah, of course I know project length and runway. How's it going? If you need me to make a call, I'm happy to do it. I felt in the ⁓ just in the moment that it it didn't feel like it was the runway might not be long enough in terms of what the market was calling for at that point. And ⁓ I ended up catching up ⁓ with some of the Delta folk. I spoke to some of the financial folk and then ultimately I I called Ed. ⁓ Bastion and I just said Ed were thirty, forty days from earnings. And I was ⁓ and he and he Ed w ed Ed was always there in incredible support, but he's running the biggest and best airline in the world. It's not like he's not looking at Ed wasn't looking at the dailies, nor should he. But I think at the end of the day, I just let Ed know that my take on the market, and I know you want it ⁓ you know, today, my take on the market was because of all this action that didn't have anything to do with private aviation. I explained to him that good faith and credit needed a capital G. It it really needed more capital to to to have people feel good about supporting this business forward from a consumer perspective, both CFOs and high net worth individuals and their fiduciaries. So somehow, some way, ⁓ you know It's an incredible 30 days. Yeah, it was a great 30 days. I'll I'll say that I was in the operating room. And I'll say that what was once a two to three hundred million dollar endeavor, I'm super proud that on ⁓ the fifteenth of August we announced the five hundred million dollar lengthening of the runway and ⁓ with incredible partners and ⁓ I would say it got done fairly quickly and it was fun to be part of that team. Did you have to take your wife back to Saint Bart's? Like was she pretty mad that you were working on the I had to go back a couple of times, but you know, the first three, four days were clean. It was they weren't working. That that's any strong business leader is the first three or four days of vacation. You're usually not in the doghouse. When I when by the end of the when I started going to the gym for four hours and going to town for four hours, she knew I was on the phone and trying to get things lined up. And listen, PJT, Jeffrey's incredible support, you know, nobody could sell the story. And what what this could be. We were the founder. Better than me better than I could. So I came in there and like I said, you know, when you gotta go hit one in the ⁓ you gotta go hit one in the parking lot, you go do it. Yeah. You know, that's the you know, you can't close the wheels up chapters with the lessons that were learned without you know talking about the incredible team that we did have that a lot of them were with us all the way through, from the incredible pilots to the maintenance. Bob Lucky, Robert Lucky, one of our pilots was there for Day one, he's still flying the challenger today. And there were a lot of Robert Lucky types, Jason Oakland and you know, the folks in maintenance, that stuff that really helped us there. And ⁓ you know, I think both of us feel an enormous amount of appreciation for the team and the dedication that ⁓ they put in to help us along the way. It was really special. I was gonna say if you're ⁓ mentioning people, how about the ⁓ the great Erica basis? Yeah. Who from the ⁓ came up ⁓ as a young ⁓ finance person. He's now at ⁓ Comlux as their CFO. Wow. There's so many amazing people. I mean by everyone we talk about. ⁓ anybody we didn't mention we didn't add this. This is a Robert Withers ad lib, but Robert always thanks the team and ⁓ we thank all of you. Yeah, for sure. Well, how I I guess there are some people that are familiar faces now at RealJet. So let's talk about Real Jet and the real family of companies, right? So I I think that ⁓ it's more than just a charter broker. ⁓ so so let's let's talk a little bit about that. Robert, what's what's kind of vision for for the aviation side of the business and and that kind of stuff? Yeah, you know, I I had the good fortune when I finished my time at Wheels Up to spend a year really just clear in my head. I spent a little bit of time with college football, but I got the opportunity to talk to private flyers in a way that they wouldn't talk to me when I was wearing a specific jersey and really ask questions. And the most common theme and the most common pitfall was that ⁓ you know, all the big operations that are out there, ⁓ the communication and the customer experience are really leave something to be desired. And so we really sat down and thought about how we could redesign that customer experience model and that communications model. Because you know, the clients will tell you that it's nine o'clock the night before flight. You get a call and it's from somebody that doesn't really understand the issue and probably isn't empowered to resolve that issue. And so what we created and what we have at Realjet is this charter hub operations model where there's a subject matter expert at every turn, world-class communication. We're doing feasibility that most charter brokerages aren't. We've got a great safety operation. We've been on site at about 30 operators in our first eight months. I put that up there with anybody and You know, you really can't understand an organization until you get there. I think about those early trips to Martin State in Grandview and getting to know Jesse many moons ago. But we're doing the little things differently and we're putting the customer first. It's been an incredible eighth month journey. ⁓ I had a thought and what I wanted to do. Kenny had ⁓ spent time developing the real platform. Ironically, our non competes burned off about the same time. ⁓ sorry. Ironically. Well I don't know if I I was two years I was one. Here's two years I was one. Ironically alive. I'll give a better word, Rob. Coincidentally. Coincidentally. Yes, coincidentally. and you know, I I kind of told him what I was hearing from customers and that stuff and and thought about it. And you know, over the next few months we started to say what could be. And ⁓ you know, ultimately we decided to Marry the thoughts that I had starting in, you know, late May, June, July, ⁓ with the real platform. And so Real Jet came in as a piece of the larger real SLX platform. I think I did not understand SLX at all when I first heard it. It wasn't until we so we went to the Masters event with you guys. You invited us to Reos, which was amazing. Thank you, by the way. That was great. Anytime you want to invite us again, it's great. ⁓ but I I I you underestimate, and then these are the private flyers, how many of these corporate events happen? You know, at all these events, you know, your bankers, your, you know, big customers for whoever it is, they need somewhere to take their customers. And I didn't realize how big of the world that hospitality is. So real SLX from my view is this kind of Amex centurion lounge experience at all these different events. And But like way better because the MX Centurion Latch food sucks and the food at rares. Actually delivering like hospitality to corporations. It's not just like the individual like relationship with the flyer, it's also these events. It's not transactional, I think. It's like well, I I think you have to have a private jet customer community mentality to be able to put on this type of hospitality. And they gotta get there. They gotta get there. So if they can get there, we've always set up the oasis. The oasis. The best of the best around the best events in the world. And ⁓ you know, inside of Wheels Up and inside of Marquee Jet, it was always a a retention driver, a retention tool. We retooled ⁓ at at Reel and it's real hospitality, real experience. And we're running that like Amazon at one point had a lot of servers, and then all of a sudden they stood up AWS. We want to be the AWS of hospitality. And I would say You know, you're not entertaining private jet like customers if you don't have a private jet arm. So as Robert said, we came together. And again, our North Star, what Robert's, you know, thinking about every day is how did Camper Nicholson become Camper Nicholson? How did Burgess Yachts become Burgess Yachts? There's your asset zero, like Coke Zero, asset zero. Yeah. And then of course you have Sotheby's and Christie's that you want to move a 10, 20, 30, 100 million dollar, 500 million dollar piece of artwork, you entrust it to them. One of the really cool things to me has been the synergies that existed that exist between these businesses. And they really are run as three separate and distinct businesses. I would say Gary Spitalnik, one of the best hospitality people in the world. Dave Kaufman's an incredible job with the sports gaming, sports technology piece that they have, predictions that they have inside real. The synergies between those businesses has gone even beyond my ⁓ imagination. I think that the number of people that have come and are flying as a result of the hospitality business and the number of people that have come out of the sports gaming business, the three businesses really feed each other. It's a logical evolution. I mean you think about Just think about the Masters, the largest private jet event in the world. Coach Coachello for CEOs. Right. Coach. The guys who are crazy. I think one thing that surprises people, because we did run a lot of this as a member benefit at both Marquee Jet and then at Wheels Up. I think one of the things that surprises people is these are all run as very distinct business units inside the real platform. So if I want to table at Rayos to take some real jet clients, we're doing a a wire. To Gary's botonics business to pay for that. Just like if he needs to fly people, he's paying us for that. And so it's not that one business is subsidizing the other. All three are run in a very healthy way. And when you combine the three, that's where you get something that's really special. Well, and I look at it like you know, if P and C Bank has a group of five VIPs in an area that they want to send to something. Instead of them having to set up their own hospitality tent, their own event, you know, their own events team. They could just call real and press the easy button and be done with I gotta thank Richard and Vince on that. What are we really doing there? Fractional corporate hospitality. You've out you've outsourced that component of that. Well, for them, like I said, do you need to own a plane if you're gonna fly a hundred hours? No. Do you need to pop up Arreyos or do you need to pop up ⁓ McSorleys if you have twelve clients at Augusta or if you have twelve clients going to Super Bowl? The answer is no. You can buy a fraction. Yeah. Yeah. That's really cool. And they and they need to fly. They do. That's Same people. Yeah. Well, Kenny, Robert, this has been an incredible conversation. ⁓ we really appreciate both of you guys coming on the show and and ⁓ I don't know, like having a real conversation. I mean, you know, that's Well, like I said, we we we love unscripted and we also love I know there's a few nuggets that We didn't plan on coming out during this thing. And I think for the audience that you've developed and cultivated here, I would say especially for the young ⁓ people that are listening that are interested in this business, I still say we're in the first, second inning, you know, as you said, Orville and Wilbur, nineteen ⁓ three, just starting. So I I think going forward there's gonna be a tremendous opportunity. AI will play into our space and help it be more efficient. But it'll never replace it. You're never gonna fly on Claude, you know, Air Claude. You're never gonna fly on Air Groc. Yeah, they still need to have pilots and and and to have OEMs out there and customers that are gonna Yeah, and you know, listen, AI's not perfect. This has to be perfect. Yeah. As it relates to the safety and the execution. So Yeah. ⁓ yeah. Just ⁓ I would say anybody there, just I encourage you. ⁓ keep going. And ⁓ if someone tells you it's not possible. Take that a it's possible. Yeah, no, that's really good. Well, this has been another awesome episode of the VIP Seat Podcast. Thanks to Realjet for helping sponsor this episode. Thanks to A B Jets. I know a partner of Real Jet. So that's there's a lot of great operation out of Memphis. Beautiful 3500. Beautiful 3500s with complimentary Starlink. And ⁓ go subscribe to the newsletter, the VIP seat.com. Share this with a friend. in aviation. If you're in aviation and you're not listening, it's a mistake. Yep. Whenever I'm in my car driving into work, I would say, I tune in. To the VIPC. So if Kenny's listening, you better be listening. Yeah, exactly. Exactly. Exactly. Five-star, five-star reviews. When David Lee Broath used to do it. When I'm in LA, I listen to Power 99 and all that kind of thing. Longtime listener, first time calling. Exactly. This is John Bon Jovi, and I got PLJ 95-5 on in my car when I'm cruising the Jersey Shore. Exactly. So ⁓ yeah, well, we will see you all next week.