Phil Michaels, the founding CSO, SVP of Sales, and investor at Volato, says the world’s first jet company to offer unlimited hours and days is the fourth-fastest company in history to go public. That, he told attendees at the Boston Smart Business Dealmakers Conference, came down to perspective.
"One of the biggest learning lessons I've had from my previous startup versus this one is always have the end in mind," Michaels says. "What's your exit strategy right when you start the business? And we packaged the company with the plans of going public from the early, nascent stages of the company. So, we're crossing our T's dotting our I's, preparing audited financials ahead of time so we were already in a nice place to be able to launch publicly."
It also didn't hurt, he says, that a lot of the company's customers are high-net-worth and ultra-high-net-worth individuals.
"They loved the idea so much that they said, 'Can we also invest in the company,'" he says. "So, that helped expedite our ability to go public, which I think was a unique position we were in."
One of his biggest mistakes he says he made with his previous venture was not having an exit strategy plan while starting the business.
"Because how you're going to operate and build and package your business and run your business is different when you're planning on an IPO versus a merger versus acquisition, versus you just want to run the family business and be the CEO the rest of your life," Michaels says. "Those are different trajectories for your company. And knowing that ahead of time will help you lead the company in the right direction."
Since the company was founded, it's made one acquisition. Michaels says they made that acquisition after finding a company that matched Volato's values, mission and vision. In their industry, he says there is a lot to consider about an acquisition target. That can include the aircraft, age of the aircraft, the models, the type and size, the team, the book of business, all of which needs to match with the mission, vision and values of Volato for a transaction to make sense.
Because acquisitions are unique in that industry, there's more organic growth. Fortunately, the people who fly private hang out with other people who fly private so organic growth can be generated through word of mouth. That, he says, helped the company grow 139 percent this past year. Comparatively, he says the next closest jet company grew 32 percent.
With his current company, he says one of the things he might have done differently is reach out to financial advisers and wealth managers earlier.
"I had no idea how many of these individuals and teams are helping their clients by buying jets," Michaels says. "And what I mean by that is saving them money on taxes. So, currently, you get 60 percent bonus depreciation up front, 40 percent over the remainder of the contract. But right now, the bill is with the Senate right now for moving it back to 100 percent bonus depreciation. And so, educating the wealth managers and the financial advisers about our jet program, because they really act as the hub and spoke model for the rest of the country, that would have been one of the things I would have learned. So, thinking about a unique distribution channel in your business can help lead to, I think, a magnitude of growth that you might not be able to get on your own. But using a hub and spoke model can help you hit different trajectory."
