Xs and Os: Trader U, VORB, QXO

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Bloomberg Audio Studios.

Podcasts, radio, news.

Hello, and welcome to the Money Stuff Podcast, your weekly podcast where we talk about stuff related to money.

I'm Matt Levine, and I write the Money Stuff column for Bloomberg Opinion.

And I'm Katie Greifeld, a reporter for Bloomberg News and an an anchor for Bloomberg Television.

What's going on, Katie?

We're going to talk about Trader School and hedge funds.

Then we're going to talk about fake MA.

And then we're going to talk about kind of MA.

Real, but weird MA.

Yeah.

Let's get to it.

Let's get into it.

So, Trader School, we're talking about 0.72, Citadel, the list goes on, other giant hedge funds, basically creating an in-house trading school to turn their nines into perfect tens.

Yes, this is a Bloomberg News big take article today.

Yesterday.

Doesn't matter.

Time is a construct as we keep going over.

This is a big take article at Bloomberg about how these hedge funds are building their own in-house trading schools.

Here we are talking about it.

Yeah,

reading this,

I kind of feel like, shouldn't you have an in-house training program anyway?

So a couple of points on that.

One is that, no, historically, all of the buy side, like used to hire from the sell side, right?

Like it used to be that if you're a hedge fund, the way you acquired new talent was from the banks.

And one thing that's happening here is like the banks are less of a source of talent for these places, in part because like banks got rid of prop trading.

And so like the ability to source good risk takers from banks has gone down, but also in part because these places have gotten huge.

And it's just like you're not looking to like identify one good trader from somewhere.

You're looking to like mass produce them.

And so having a training program is kind of a new need for these big firms, right?

Used to be a hedge firm was like one manager.

And when that manager got rich enough, they just, the firm went away.

So like having this very institutional structure is kind of a new thing.

And so you need a training program.

The other thing about it, though, is it's not just training, you know, incoming people to be good analysts.

It's taking the people who are analysts and have been there for a while and trying to find out if they will be good portfolio managers and promoting them to being portfolio managers as carefully and scientifically as you can.

So instead of being like, yeah, you've been here a while, here, manage a book, it's like taking the analysts and seeing if they'd be good at managing a book and teaching them how to manage the book.

So two points.

So we're talking about it as trader school, and the article talks about it as trader school.

What's more fun to me is this sort of dystopian vision where it's actually just like a factory and you're just putting this person into the machine.

It does some combination of lights and sounds and things to the person and then they spit out as this stock picker.

Well, that is sort of how these things are supposed to work, right?

The idea of these multi-strategy hedge funds is they're very like scientifically managed and they really like carefully monitor your trading and they make sure you're neutral to all the factors.

And if your portfolio goes down by a little bit, they like pull some capital.

And if it goes down by a little bit more, they fire you.

It's, you know, it is like an alpha factory, right?

It is like trying to somewhat dehumanize the management of traders.

So yeah, it is a machine that flashes some lights at you.

But wait, I also want to take it seriously as a school school because I would like to go to trader school.

I want to audit a class at Trader School.

I don't think I would do very well, so I don't want to receive a grade at the end, but I would like to see what happens.

Apparently, they grade them out of 10, right?

Yeah, right.

Usually, the analysts come in as nines, and they're supposed to leave as 10 portfolio managers.

I think I'd come in at come in at like a two.

I was going to say, I'd be a solid one, maybe a two on a good day, and maybe come out as a

park of four.

Yeah, pick a four as a reasonable.

Two Two points on that.

One is that I hope that by saying that you want to audit a class at Trader School, you have manifested that and that we will be invited to audit a class at point 72 or someone or Citadel or anyone's Trader School, any multi-strategy hedge fund that wants to have us audit a class at Trader School and maybe

do some field recording.

It doesn't even have to be top tier.

We go.

We don't need to go to like the Ivy League of Trader School.

I'd be willing to go, you know, in state, but

yeah, I would love to do that.

That would be our first like field podcast recording.

I feel like we'd learn a lot at Trader School, and so would our listeners.

And so would possibly the hedge fund that hosts us.

I mean, 0.72 sounds like it is the place to go because the article mentions that more than half of Steve Cohen's stock pickers have come through its program rather than big, expensive outside hires that they've had to make.

It does seem a lot cheaper to run a trader school than to pay someone a $50 million guarantee to come be a portfolio manager.

Yeah.

I mean, maybe it's less good for you, that star stock picker, because you don't want to be.

Right.

It's like you're like on the rookie contract, right?

Like you get paid like an employee rather than in a bidding war for your talent.

Yeah.

The other thing about Trader School is my dream has always been to do my job as like, I write my newsletter for like, and do my podcast for

six months of the year.

And then I go like intern in a financial job somewhere for six months of the year.

Like, wouldn't that be fun?

I feel like this company would let you do whatever you want.

I know, know, but like, who would hire me for that?

Like, who, like, hopefully some of our listeners, but who would be like, oh, yeah, come, like, do a bad job at our job for six months and then go write about it, right?

This is the most heavy-handed section we've ever heard.

I know, right?

Like, please have us come into your thing.

Yeah.

I didn't even mean it that way.

It's so, it's hard to know what these jobs are like unless you've done them in some way.

Yeah.

And I feel like I could learn a lot by like spending a few months.

Me too.

I mean, I feel like I was born and raised inside this building.

I've been been here since I was 23 years old.

Isn't the point of journalism to go out and have broadening experiences and really get to know the industries and the people that you cover?

Yeah, and I've had some jobs in finance, and that was nice, but I haven't had all the jobs in finance.

Yeah.

You know, I'd like to, you know, manage a little portfolio for 4.72.

I feel like that could be good.

I feel like that's something you do in high school, right?

You sign up and have like a paper portfolio.

Well, I think

the trainer school is to train them to run a real portfolio.

But yeah, some of these schools do have have you run a paper portfolio.

Yeah, I think I bought like shares of Hot Topic.

Okay, that sounds right.

Yeah, I think this is at least the second appearance of Hot Topic on this show.

I spent a lot of time at Hot Topic.

What else should we say about this?

I mean, again, it seems like a cheaper way of doing things.

There's a lot of conversation in this article about the talent war going on in hedge funds right now.

I think that it's just like these funds pay so much to portfolio managers.

They charge clients so much.

There's so much demand for this.

And I I think part of it is like these are places that are pretty good at identifying alpha and being able to say like we can strip out all the elements of luck and market exposure and just identify who is skillful at managing investments.

And then we can offer you that sort of pure uncut investment skill.

And the clients apparently love that because it's uncorrelated to everything else and it usually goes up.

And so they're willing to pay basically whatever fees these funds charge.

And given that, it's clear that there's just a shortage of people who can generate alpha.

And it's not clear that that would be like a natural shortage, right?

It's just like there's only so many people who've like come through the pipeline of becoming portfolio managers at 0.72 or whatever.

So if you can train more of them, like you're filling this like enormous unmet demand and you can make a lot of money, right?

If you can like bring someone in cheaply and turn them into a $50 million a year portfolio manager, like, yeah, it's a great business.

I don't think I have any ideas, but wouldn't it be fun to like do a thought exercise of like, what would your trading school look like?

Like what are they learning in trading school classes?

What are they learning in trading school classes?

So I think that we're sort of exaggerating by saying this is trading school, right?

Like this is like...

But isn't it fun to go along this flight of fancy?

Sure.

So I think that this is like a lot of it is like some sort of combination of like actual classes and like mentorship and meetings and whatnot for like existing analysts who want to move into portfolio manager roles where they're trying to figure out if they'd actually be good at it.

But I will say there are people who run trading schools and those people are the big prop trading firms, right?

Oh, I thought you were going to say the people that keep trying to scam you on Instagram.

Oh, yeah.

I don't think those people even run trading schools.

I think those people just run Instagram ads.

But no, like Jane Street and Susquehanna and all those sort of big prop trading firms are very invested in training people how to think like traders because you can't really hire people out of school who know how to do that.

If you're hiring investment bankers, it's like some combination of like, can they do a DCF model and like, will they work really hard?

And there are ways to figure that out.

But knowing if people people are good at operating under uncertainty and like estimating probabilities in their head and sort of being decisive and like taking risks in the right way is just harder and so a lot of what these firms do both in their like lengthy interview process and then like in their like internship programs is like they sit them down to like play poker every night and they play like fake trading games where they evaluate their ability to like make these decisions so it's a really like very organized trading school where they're trying to see who is like overconfident, who is too timid, and who has the right ability to take risk.

There were some examples in the big take.

At Citadel, for example, trainees are taught how to back pitches from colleagues lower down the food chain.

At Bally Asny, they get a limited pot of cash, then they have to deliver returns that match or beat the firm's older hands.

Point 72 wants its cadre to think like CEOs, meaning they'll need to create and run a book of ideas all while getting total buy-in from their teams.

That doesn't quite fit my fantasy of my dream trading school.

Right, because this is not really a trading school.

This is like developing

soft skills.

Yeah, it's like developing like senior portfolio managers.

Like, that's a management job, that's an investing job, but it's also like a risk-taking job, right?

Whereas, like, if you're like a 22-year-old at Jane Street, you're being taught Indian options.

Yeah, yeah, yeah, right.

There's great stories in Michael Lewis's book going infinitely

about

Sam Backman-Fried's training days at or internship days at Jane Street, where he like learned to like make positive expected value coin flip bets with his fellow interns, right?

Part of the goal of the training program was to like have the interns bet against each other and sort of see who was good at betting and who was good at like finding and exploiting edges.

I would not want to go to that trading school, but I like the idea of the trading school as a sort of like Darwinian fight between the interns for like, you know, there's only so many jobs and whatever intern can like outtrade the fellow interns gets the job, you know?

See, again, that's something I would like to audit since I would do terribly in that program.

But boy, would it be fun to watch.

Right, right.

I found it stressful.

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I would find fake M ⁇ A stressful.

Yeah.

This is so good.

Virgin Orbit, a space company, went bankrupt like last year.

Right.

But before that, it sort of announced that it was in its last stages, like it furloughed all of its employees.

And this guy named Matthew Brown sent them a LinkedIn message being like, hey, I would like to invest $200 million in your company.

And they were like, hey, great.

That sounds good.

Thank God.

And they like negotiated the deal with him.

And eventually the deal fell apart probably because he didn't have the money.

SEC brought a case against him this week, certainly claiming he didn't have the money.

And in fact, he sent a screenshot of his bank account showing like $182 million to Virgin Orbal, but it was a doctored screenshot and actually it had less than $1.

Yeah.

Strange amount of money to have in your bank account.

Yeah, quite a discrepancy.

So the deal fell apart and the SEC sued him for fraud saying that it was a fake takeover offer.

But what I like about it is like, I read a lot about fake takeover offers and they're all the same, which is that someone like buys stock in a company and then like puts out a press release saying, hey, I'm taking this company over and the stock goes up and they sell the stock and then they like fizzle away.

But this guy did not do that.

He did not buy stock in the company, he did not put out a press release.

He might have just been doing it for fun.

This upsets me because I don't understand the motivation.

So he says it's real, right?

I mean, like he gave a statement saying, no, no, the

full of misrepresentation.

Let me read it for you.

The SEC's complaint is filled with egregious errors, fabrications, and biased allegations that undeniably favor the culprit.

And the culprit is Virgin Orbit's management.

I love that he says that they're the culprit here here for doing due diligence.

Yeah, right.

I mean, I have talked to previous fake takeover guys, and they're like, why won't this company take my calls?

I'm offering to give them all this money as soon as I can raise it, but the company won't take my calls.

Virgin took his calls.

Like, they signed an NDA.

They sent up a term sheet.

They like sat down and negotiated a deal with him.

Yeah.

Eventually started asking questions like, do you actually have this money?

Could you put it in escrow?

And he walked away.

But I don't know.

It was the motivation.

Like, he says it was real.

I would like to think that he just just wanted to be on TV.

Like, he did this thing.

Yeah.

And he did eventually get on CNVC to talk about his proposed deal.

He could have just started a fake AI company and gotten on TV that way.

But this is so fun.

I don't know.

Right.

There are a lot of ways to get on television, but this is a good one.

And you grew up in this building.

I grew up as an M ⁇ A lawyer.

And I always thought the like drama of negotiating deals was kind of interesting and exciting.

And he not only got to go on TV to talk about his deal, he got to like actually negotiate a deal.

Like he got a term sheet.

He was like doing calls with the CEO.

He had a lawyer involved, but he's like, let's not bring the lawyers into this too much.

I'll just, we'll negotiate this deal together.

So I don't know.

It seems like it would be fun.

I would totally role play negotiating an M ⁇ A deal.

This is another thing I would do.

Like besides go to trader school, I would role play negotiating M ⁇ A deals for fun.

And this guy might have done that.

I would find that so enormously stressful.

Not if you knew you weren't going to do the deal.

That's true.

You know, oh, you know, instead of $200 million, you're like $210 million.

You're like, sure, $210 million.

I'm not paying that money anyway but the other thing is like the sec claims that what he was trying to do was extract money out of virgin so what happened is that you know he was like i'll put in 200 million dollars and then at some point he sent them an email complaining that the deal had leaked

This is before he went on TV.

Unclear why the deal leaked, but he said, I want a breakup fee.

So if this deal doesn't go through for any reason, if I can't actually invest the $200 million, I want you to pay me like 3%, like $6 million, right?

Which is an unusual ask.

But people get breakup fees, but not for like deciding not to do the deal.

But if it had worked, if Virgin Orbit had said, sure, we'll give you $6 million if you can't give us the $200 million,

then he might have walked away with $6 million.

But wouldn't that have been clawed back?

Yeah, of course.

That's not a good plan.

Because they were going into bankruptcy and they did, in fact, go into bankruptcy.

Like the idea that they'd pay him $6 million for pretending to do an equity investment, not that likely.

Again, this just seems totally, totally stressful.

The CNBC appearance in and of itself was pretty weird.

I didn't watch it.

I don't think I could watch it.

I find it very stressful to watch.

It was stressful to watch.

We fully plan on transacting with the company within the next 24 hours.

I

have positions in over 13 space companies, and I view them all as neighbors.

He did not seem like an experienced investor in space.

Space investor?

Yeah.

I would also struggle to name 13 space companies, but that's.

Oh, I think he would have as well.

Yeah, that's a good joke.

It felt stressful.

And it did not make me confident that the deal was going through.

What do you do after this?

He's 34, right?

So I don't know.

Maybe he has a long career of fake MA in front of him, but I feel like this kind of blew his cover.

Sometimes these things are like people who actually do do a little investing and bite off more than they can chew, right?

And like maybe he can go invest money in other companies and be like, the SEC got it all wrong that time.

yeah I'm good for this one million dollar investment I don't know I mean at this time but you also think about Virgin Orbit's perspective during all of this because this was sort of like a white knight savior moment yeah they did start asking him questions like do you have the money but like they definitely like you know he sent them an email and they engaged right like yeah he sent them like a cold linkedin message anything done over linkedin i mean come on there's like no record of him right like he's you know he's like i've invested 750 million dollars in space companies.

And they're like, sure, you have, right?

Anyone

who's good, right?

Like, they would take anything at that point, right?

Like, this is not the, you know, the top person on their list of potential investors.

But at this point, they're like a week from bankruptcy.

They're like, yeah, we'll take what we can get.

And so they returned his calls, right?

It is tough for them, right?

Like they jumped all in on engaging with this guy who turned out to be fake, apparently.

They had not a lot of other good options.

Yeah.

I think

someone from the company I read called it an unneeded distraction at what was a very critical time.

And I'm sure they

was he distracting them from other better investment maybe probably not but maybe

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Let's keep the conversation going on M ⁇ A and let's talk about a weird M ⁇ A that's going on with Brad Jacobs and

QXO.

I'm not familiar with the naming structure for his companies, but he's like a XPO, QXO.

Right.

He's like a logistics guy who likes.

I guess he's,

there's certain letters that he likes.

Right.

He's a fan of an X, but not only an X like Elon Musk.

He needs somebody.

He likes O's, yeah.

Yeah, X's and O's.

Anyway, so he like ran XPO.

He's made a lot of money doing logistics.

And he wrote a book called How to Make a Few Billion Dollars.

I have it on my desk.

I still haven't made a few billion dollars.

No, but it's like such a good aspiration.

It's like not $1 $1 billion.

Yeah.

Not like a lot of billion dollars, but a few billion dollars.

A few billion.

You know, get comfortable.

He runs these businesses where he like rolls up smaller businesses, right?

Like, he goes out and acquires a bunch of smaller companies.

And

he's decided he's going to do that in the building products distribution business.

Sexy.

Yeah.

It's like companies that distribute.

I don't know.

It's important, okay?

Like, I haven't read the book, but this is apparently how you make a few billion dollars.

You find like a large, lucrative, kind of boring niche, and then you buy all the companies companies in that space and you know, make them more.

You can consolidate an industry.

Yeah.

So he's done that before.

His plan is to do it in this building products distribution space.

So he started QXO.

And QXO, like, he's raised like $4.5 billion.

Like, some of that is his own money.

Some of it is from big outside investors.

And, you know, he's like got a $4.5 billion fund to go out and buy building products distribution companies and roll them up into a big QXO thing and then, you know, make a lot of money on it.

But he didn't do it as like a fund or as a private company.

He did it by acquiring this little public company called Silver Sun Technologies,

which is like a real company.

It sells software.

Yeah, it's like it like sells business software to it's like resells business software to businesses and then consults them on how to use the software.

It sort of seems like it's vaguely in the same like building products universe, but it's like selling software instead of building products.

Anyway, it exists.

It's a real company.

It's a public company, publicly traded, small, has like, you know, one and a half million dollars of net income a year on like 50 million of revenue.

And like, you know, it was like a

$15, $20 million market cap.

So it's like a small company, but it's a public company.

And he called them up, apparently through Goldman, like his investment bankers called up SilverSun and was like, we want to put in a billion dollars into SilverSun.

Take it over.

We'll own basically all the stock, but not all the stock.

Most of the 99% of the stock.

And we will change its name to QXO and make it into this

platform for rolling up building products distributors.

And Silver Sun is like, yeah, sure.

And so he bought Silver Sun for a billion dollars.

Insane.

And so now he owns basically all of it.

It was like a $25 million market capital.

Yeah, it was like as low as like 15-ish or something,

like not that long ago.

But yeah, it's like double-digit millions.

Yeah.

So now he owns like basically all of it.

But there's a little bit, there's like 600,000 shares that trade.

Yeah.

And all these people, not that many people, but like the people who buy the 600,000 shares, you know, there's like retail demand for people who want to invest alongside Brad Jacobs, right?

They're like, we've read he's he's a guy who can make a few billion dollars a few thousand.

This is a good plan.

He's going to make money doing this rollup.

So let's put our money into it.

But like there's so few shares that are publicly available that they're trading at like they've gone down.

They're in like the 70s now, but like they were at like $230 a share a couple of days ago, which if you multiply that by like the total shares, like the people who put in the $4.5 billion

to actually do this company, you get a market cap of like almost $200 billion.

So I think that the retail investors buying the stock do not quite understand

how the capital structure works.

And so they're buying this stock at a price implying a $200 billion valuation for a company that, again, is just a fund of cash, right?

Yeah.

It's just a $4.5 billion pot of money that Brad Jacobs will use use to go out and find companies.

But right now, it doesn't do anything except has this tiny little tech business.

Well, to be fair, this is an extremely weird capital structure.

Oh, yeah.

Like, why is my first question?

Like, why not just do this the normal way and eventually IPO and go about it that way?

Like, why buy this small cap with the plan to spin it off?

I went back to a December 2023 interview that Brad Jacobs did, and he said, basically, we're putting it into a small cap.

We're going to spin that company back to the legacy shareholders.

In a few months, when the deal closes, the Silverstone shareholders will have their company back.

They'll also have a $2.5 million dividend, and they'll get 0.3% share in my new company.

Like, that is a lot of steps.

Yeah.

By the way, they didn't do that.

They were planning to do that.

Yeah.

They changed their mind and they didn't spin out the legacy business to the old shareholders.

They're keeping the legacy business, which, by the way, is like, it's a small business, but it has like 200 employees.

It's not like a nothing.

It's like a real company that does stuff.

So they're keeping the legacy business.

They're not spending it out to the shareholders.

And instead of paying them $2.5 million, they're paying them like $17 million, which again is like sort of around where the market cap was before Brad Jacobs came along.

Why do it?

I don't know.

It's weird.

I mean, he had Goldman Sachs like calling small caps wherever.

Importantly, they called and they didn't send a LinkedIn message.

Yeah, right.

I mean, that's the normal way to do M ⁇ A is like your banker knows someone and calls them rather than sending a cold LinkedIn.

But anyway, the answer is it's nice to be publicly traded sometimes.

It gives you some advantages in fundraising.

I think that a big part of the answer is probably if you're doing a roll-up, you want to be able to give people stock.

And it is perhaps more convenient to be able to give people publicly traded stock.

So if he's going to buy a small building products distribution company, he can be like, you know, I have this pot of money.

I have like $4.5 billion.

I can give you some money for your company.

Or I can give you some of my publicly traded stock or some combination of them.

And so, you know, if you're rolling up these businesses, people who have built these businesses over time want to have some continued economic exposure to the thing they built.

And so like, you can give them stock.

It's like, you you know, you'll still have some, you know, diluted economic interest in the thing you built.

There's a bit of a problem where, like, what price do you give them the stock at?

Because he is like raising money at, call it $9 a share, which is like kind of roughly like you're putting in cash into a fund, right?

Like, you're buying it at like sort of the cash value of the fund.

But like, meanwhile, the stock is trading at like $70 a share because it's like people's hopes.

So I don't know the first roll-up he does, the first acquisition he does, like, is he going to pay in stock valued at $9 a share or $70 a a share?

Yeah.

It feels, I mean, in some ways similar to the Destiny Tech situation in DXYZ

when we're talking about enormous, enormous premiums here.

Right, exactly.

Like Destiny Tech is a pot of money that owns, it's like a pot of shares and private companies.

And, you know, it's like cool private companies that retail investors can't invest.

It's like, you know, SpaceX and whatever.

And so when they took Destiny Tech public, there was more demand for the shares than the actual value of the companies it owned.

And so it was trading at like a thousand percent premium to net asset value.

This is a little bit like that, right?

Like this is your chance to invest in Brad Jacobs' private investment vehicle rolling up the building products distribution business.

But the trade-off is like you're not really investing in that.

You're really investing in like the sort of meme-y retail premium to the actual value of the company.

Because like if he does really well and like triples the value of the company, that's still way less than what people are paying for the retail stock today.

Yeah.

I also

curious about how Silver Sun executives feel.

Because in some ways, it kind of feels like winning the lottery, I would imagine.

Like, how did he pick this company?

I don't know.

I think that the bankers must have had a list of very small companies that we could acquire.

Because it's not like he paid them a billion dollars, right?

Yeah.

It's like he put a billion dollars into the company.

And like the existing shareholders, what do they get?

They get a dividend, right?

Which is in round numbers, like 50 to 100% of the value of their shares, right?

They're getting paid out in cash.

And then they also keep their shares, which have, you know, gone up from like nothing to $200.

Sell them right now.

Yeah, I think a lot of them, I would think a lot of them probably would have, yeah.

Yeah.

Again, it just feels like winning the lottery.

This is so strange.

It's very strange.

Yeah.

Now, there's always been this sort of like industry of little public companies that are useful for reverse mergers because every so often someone wants to become a public company not by doing an IPO, but by like merging with an existing public company that doesn't have much there.

Right.

And so with Silver Sun, the idea was like, there's a little bit of a business there, and we'll spin it out to the existing shareholders.

So we'll end up keeping its listing, but getting rid of its business.

Then they changed their mind and now they're keeping its business too.

And why do you think they did that?

I don't know.

My guess would be it's just logistically easier, but I don't know.

I would be curious.

A lot of like reverse mergers are done with companies that like don't really have any business at all anymore.

Like they did exist and they closed down.

So you see all these companies that were like gold miners and then they became cannabis companies and then they became crypto miners and then they became AI companies.

Yeah.

They did like every buzzword because they keep being like reused for their public listing.

This isn't quite like the this is like the sort of high-end version of that, but it's still, you know, a $25 million company.

This is like a billionaire calling Goldman to call a company.

And they're not going to call it like the worst of the cannabis companies, but like it's a small company.

Yeah.

The best of these is, of course, the New Jersey Deli.

Oh my God.

Your hometown deli.

Your hometown deli.

Hometown International is a public company that had one deli.

And at some point in like 2021, David Einhorn called it out because it was a single deli that was trading at $100 million.

That was such a moment.

That was such a gleeful time.

It was amazing.

And I wrote a column about it pointing out that actually the fully diluted value of the deli when you counted for all the warrants was $2 billion.

Yeah.

And like the deli was very perplexing.

But ultimately, it sort of turned out it was like...

some reverse merger promoters who were hoping that you would have a sort of valuable enough public company that someone would want to do a reverse merger with it and go public by merging with the deli and the deli was just sort of like an easy business to to hive off the eventual public company but then they were sued for fraud because they were sort of allegedly manipulating the stock is the deli still in operation like is there a physical deli i believe the deli closed but at the time there was so much financial journalism about the deli like several business reporters went to this town in new jersey and ordered sandwiches to bring naturally sandwiches are good i always found that puzzling because if you looked at the financial statements of of the deli, which were public because it was a public company that was also a deli, their employee costs were so low.

Like, I was like, how could they be open even 10 hours a week?

So, I don't know.

But apparently, financial journalists would go to the deli and order sandwiches, and the sandwiches were pretty good.

So, it was a real enough deli, but also somehow a fraud.

But anyway, this is a real public company that

was kind of small and now it was like a tiny part of a big fund.

Yeah, now let's do some roll-ups and consolidate this industry.

Yeah, yeah.

And that was the Money Stuff Podcast.

I'm Matt Levine.

And I'm Katie Greifeld.

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