YouSaid · the spoken record

Tim Dunn

lines on the record: 90
first: 2025-01-20
most recent: 2025-01-20
sittings or episodes: 1
sources: podcast

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“When you have a drilling unit out in the northern Midland Basin, you've got several different options to develop it. One of the ways that a lot of our peers adopted was when horizontal drilling was quite early before we had really refined the well design and the fracking methodology. People went and drilled a lot of one-off horizontals in virgin acreage on drilling units that hadn't really been drilled before. And that was a real help to near term cash flows that helped with your quarterly progression on production. But ultimately that was a mistake because it marginalized the ultimate recoveries from that drilling unit. So the fact that we drilled horizontals to hold the land and then did very few one-off horizontals and were able to offer those undrilled units to buyers was a big part of the value creation.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Capital program, but over the life of an entire asset, I think we managed the asset to try to maximize the total amount of profit dollars that would come off of that asset over time. There are distinct trade-offs in there, and you can see how different companies would take different decisions based on the constraints that they face. If you're in the public market, you care a lot more about quarter to quarter performance. If your cost of capital is different, you would make a different decision than the ones we made.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“We treated the land as if we were going to hold it forever. And as a result, we always wanted to develop it as if we were going to drill every well on it. And we knew that our cost of capital was high. We knew that the ability to go out and replace that land was effectively impossible. There's a finite amount of it. We had some of the best resource in the entire world. You can't just go out and recreate that land position. And as a result, we drilled the wells in a much more deliberate way over time. As a happenstance of that, also maximized the value for any new buyer that would come in and buy the asset. It didn't necessarily result in the best quarter to quarter production growth. In fact, it decided it did not because that was never a consideration for us. It didn't result in the highest near term internal rates of return on our”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Big advantage that we had in this deal is that our management team was very successful before CrownRock. They weren't looking for their next dollar to go on vacation or buy a new home. They were very well set up even before that. So they had the flexibility of taking a very long-term view. And when we opened the door to them that the private equity firm Limerock were not necessarily beholden to strict five-year terms. When we get above a 3x, we always hit the exit button. I think they started thinking differently about we might not actually hold this investment forever, but we can manage the investment as if we're holding it forever. As a result of that, I think we took very different decisions than many other people would take in terms of how we develop the assets, which ultimately added a lot of value over time. But of course, we didn't have the contractual right to hold the investment.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Around 2011, I think we really started talking about that more directly between ourselves and the management team. Before that, we hadn't really talked about exit much at all, but we had a successful investment going into 2011. And I just remember calling up the CEO of the business and just saying most of the management teams really start thinking about exits around this point in time. You're four, five years in at that point in time, we're three to four X ROI on the investment. When you go into a deal with the management team, they're always worried that the private equity firm is going to sell the business out from under them at some point. The vast majority of the deals that we're in, when we actually exit, it's because the management team wants to sell more so than us. And there's very logical reasons for that. Almost all of their net worth in a successful deal is involved there. They start to get really worried about concentration levels and the like.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“And I think that was an important distinction relative to the other PE backed oil and gas deals at the time, and that the mindset was just forever. It's a long-term case. Capital allocation is everything. You marry the best land division in the Permian Basin with the best drilling and operations team in the Permian Basin, and you have a, don't worry about next quarter mindset, worry about what we look like 10 years from now mindset. And I think that dials back to the ownership structure. This was not a term sheet that said, hey, under certain circumstances, the management team take is X percent of the profits. And above that level, it's Y percent of the profits. It was a mutual ownership structure from day one where the management team and the LimRock team in parallel thought as owners of a business jointly and building value through time with really no end date. Unlike, I'd say, just about every other deal that's gone through the system, the attributes of forever hold.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Use less leverage than many other players. But I also think the team's really, really strong focus on operational efficiency enabled us to do that. Our vertical wells were economic even at the worst of times. That turned out to be incredibly important. If you just look at the absolute breakdown of value creation in terms of vertical wells versus horizontal wells, almost all the value creation ultimately resulted from the horizontal wells. We wouldn't have had the land to drill those wells on unless we held the acreage with the vertical program. So the efficient vertical program is what allowed us to put ourselves in position to capture the huge value uplift when horizontal drilling took over. Management team philosophy was a forever hold philosophy. So if you canvass the investment banks,”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“And I think one of the calling cards of Limerock as an investment organization is we're reluctant to use aggressive leverage structures. We use leverage less aggressively. And when we did have leverage, we used hedging aggressively to ensure that we had the capital to continue our drilling program at bad times. So that meant when we hit the global financial crisis, when we hit the shale war versus OPEC, when we hit the pandemic, we had locked in the revenue stream. We were able to spend our board meetings focused on where are there opportunities to add to the acreage position. Where can we high grade? Where can we pick up locations that are better than our existing stuff? We didn't have to sit there and worry about restructuring covenants with lenders and desperately protecting the value of our assets to avoid having to sell at a bad time in the cycle, which is really the cardinal sin in our business from a value destruction perspective.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Just capitalizing on that innovation that had already been perfected in other parts of the country at that point in time. And then the last extinction level event was obviously the pandemic of 2020 when oil prices actually went to negative $40 a barrel on a single day for the first time in the 150 year history of the oil business. It was by far the most calamitous from a oil price perspective, but again, really forced very substantial operational changes within Crown Rock. Two-thirds of those operational efficiencies that we really focused on and gathered then persisted for the years after the pandemic. So if you can live through these things, which fortunately we were able to, you come out much stronger. But man, there's a lot of up and downs through that 17-year period.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Whenever we want, really focus the industry to be much more high graded overall in the most productive resources in the U.S. So there's entire plays that were 400, 500 rakes were running that are completely wiped out and have barely re-emerged in the year since. It also really strengthened the focus on the Permian Basin, which is where fortuitously all of our investment was located within Crown Rock. And that proved to be by far the most resilient of the basins. You could drill there at that point in time at oil prices below $30 a barrel because service costs adjusted at the same time too. And it also prompted an acceleration of a big industry shift in the Permian Basin from the vertical drilling, which we had been doing since our founding in 2007 to horizontal drilling, which proved to be effectively a 3x uplift in the productivity of the cap.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“The other two just before Thanksgiving in 2014, Saudi Arabia and by extension OPEC essentially declared war on shale. They set out to reclaim market share after tremendous amount of shale growth had really cut into the market share of OPEC from the 2010 to 2014 period. And 2015, which followed this announcement, was a complete wipeout. I mean, oil prices fell by 50% again. The rig count went from 2,000 rigs to get as low as 300, 400 rigs. More bankruptcies than you had ever seen in the oil and gas business since the 1980s, I think in hindsight we can look and say a lot of those 2,000 rigs were very unproductive and we're not focused on the best resources in the country. In that moment where Saudi said, we can put you out of business.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“credibility with its partners in the services world that they were going to be a differentiated partner, that they were going to drill through really hard points in the cycle where other of our competitors burned a lot of their suppliers over that point in time. So that was a really key fiddle moment. And I think you can kind of point to different pivots that came out of all of those extinction level events that we really lived through.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“That point in time last week, there was less than 600 rigs running in the U.S. So there's been a dramatic drop in the aggregate level of activity in the U.S. But in 2008, there's 1,700 rigs running. It's very hard to get access to oil field services, the drilling and completion services that you need, the wireline services that you need to actually drill an oil and gas well. When everything bombed out is part of the global financial crisis, oil prices fell to $40 a barrel, effectively falling by two-thirds from a recent peak. Suddenly, oilfield services were readily available. But you had to have capital to do that. And fortunately for us, we were very, very focused on risk management. We had already sold forward in the financial markets 90% of our next year's crude oil production. So we had a lot of ballast and resiliency through that period. That was a key moment for the company in terms of really establishing.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“On average, we had a pretty productive oil price environment throughout the history of the investment. Oil prices averaged about $70 a barrel through the history of our ownership of the investment. But there were three calamitous events along the way that really affected the trajectory of the business. I think the CEO of the business, whenever we talk about those calamitous events, he always likes to focus of the good that came out of those extinction level events. The first was the global financial crisis that occurred really within two years of making that first investment. And in all of these extinction level events, there were a lot of bankruptcies in the oil and gas business. The really good thing that came out of the global financial crisis is going into it, oil prices were very high as a result of the China supercycle essentially people were drilling everywhere across the US. I mean, there were 1,800 rigs running in the United States.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“The early years, management teams executing on this, you've got a nice oil price environment to be generating a lot of cash flow. What changed to go from investing as you thought you would according to the model and its working out to a longer duration hold?”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Through on your commitments and drill the wells. And we were able to convey, in part, because of the local nature of the management team, that we would really be able to follow through on those commitments.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“We had a huge advantage in that our management team all existed and lived in the Permian Basin. They were Midland, Texas guys. Most of the oil and gas business is outside of Midland, Texas. It's in Houston. A lot of it at that point in time was in Denver or Tulsa or Dallas. But our team was entirely in the Permian Basin. Most of them had lived their entire lives there. Bobby Floyd, who was our chief head of land and president of the company, co-founder of the business, was a fourth generation middle in Texas oil and gas guy. So they had very deep relationships with the landowners in and around. They'd had multiple other endeavors in the Permian Basin previously. So they had a lot of credibility. When you go to a landowner and you tell them that you want to lease his property to drill wells, you're basically locking up that asset. The landowner has to have a lot of trust that you're actually going to follow.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Wanted to clarify this was during the era when we were still drilling vertical wells. These were old style vertical wells, although we were introducing fracking technology into it. The wells were not nearly as prolific as subsequently the horizontal wells. This was sort of the initial phase of exploitation of the play.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Were to go buy producing assets, you would effectively get a large base of producing properties that would be earning a 10%, call it 15% rate of return on something. And as a sideline of investing the capital to get access there, you would get some undeveloped land that would have much higher rates of return. And these cases, the rates of return were 100% or more for the raw acreage that was to be developed. So we simply made the decision It's a lot harder to just to do this super high rate of return stuff. It's a lot more labor intensive. You have to have good relationships on the ground. You have to just be willing to really churn a lot of capital. We chose to go that route very deliberately.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Able to recycle capital very fast, plow all of those returns back into the ground. We had an exceptionally good land team. And the only gas business you have to have landmen that have all the relationships to make sure you have access to the legal rights to the lands that you drill on. And we pursued a very low cost, high return strategy, which is to go out and lease land from individual ranchers and mineral owners directly as opposed to going out and buying other companies or existing producing assets, which a lot of our competitors had pursued. And that was driven by the fact that the returns were simply higher. You wouldn't grow as fast by pursuing the strategy that we did, but you would grow much more profitably doing it that way because the cost of entry was much lower. It took a lot of work. It took a lot of time. You were buying lands in really small parcels. It was a building exercise.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Was the big setback. A lot of other private equity firms may have reacted differently in that situation. We committed $75 million. The management team contributed $25 million in properties. So the only primary equity that was ever invested in the business was $100 million. That early stumble was a lot to absorb and take on and really to kind of reassess whether we thought we still had a real company here to invest in. We were also very fortuitous in that we were essentially hitting the peak of the China supercycle around that same period. Oil briefly in today's dollars exceeded $200 a barrel for a period of time, the oil wells that we were drilling right around Midland, Texas were insanely profitable. I mean, we were essentially able to recycle capital with the use of leverage in a three to six month period of time, which really carried those early losses. As a result, we were”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Occasionally have moments when you're in the commodity cycles that things bomb out, and it's what I call just the green light special. Nobody wants to go near the sector and everything's for sale, and it's a pennies on the dollar type of moment. And you sort of know the risk, but you also know there is asymmetry to the upside. And some of our best returning deals through time, early on, we were gifted a collapse in the oil price. We started the business in 1998. Oil prices went from 20 to 10. We had no portfolio and capital to invest. It was a perfect moment to start a business. But there was no element of that asymmetric type of the markets bombed out, time to get loaded up in the Permian Base, and let's get into Crown Rock. It was a growth story that was operationally driven. So the output really had no element of deep value when nobody else was going near a segment of the sector, at least by my review of how the deal evolved vis- ⁇-vis other deals that have been sort of outside.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“It was very similar to most investments that we look at on the front end, and we were expecting around a 3x ROI over a five-year period. That's probably around the median expectation. It was only after living with the investment that our investment thinking really started to evolve. Over time, as we were able to gather new information. It was a long evolution. I mean, we were in the investment over 17 years, but the initial expectations were very prototypical of most other deals that we've invested in.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Crown Quest operating, which was the name of the company that we formed a joint venture with. We took the crown from their name and the rock from our name. The other option was Lime Quest, which we thought sounded a little too Jimmy Buffett-esque, so we decided not to go with that one. They had achieved some success by buying older fields. They had done some transactions with GE Capital, where they were provided with capital to do reactivations of existing wells, work over existing fields. They had developed expertise in doing that and had achieved really good results. So they had a positive track record. This was a little bit of a step out in that they were trying to pioneer a new resource play, in this case the Gothic Shale. But we also recognized that the Wolfberry play, which was the company's other area of focus, there were huge in place reserves there for many years. This was known as promoters paradise because you could drill a well in the wolfberry and you always produced oil. It just typically didn't pay out. We also recognize that there was”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“CFO at Parker and Parcel. I'd worked with John. Of a shale formation below the sprayberry. The Gothic shale was a complete bust. We lost half of our capital. Then we invested in that part of the play, but the wolfberry was so profitable so early that it carried those other stumbles.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Talking at this point essentially around the dawn of the shale era in US oil and gas development, which has been a very pivotal moment in period not just for the oil and gas business but for the overall global economy, which has substantially reduced commodity prices over that period of time. At the time that we actually made the Crown Rock investment, we had ideas of what would come together. The initial thesis was a pretty simple one. At that point in time, you had a very successful shale development around the Dallas-Fort Worth area and the Barnett Shale, which kicked off a whole new era of horizontal drilling and fracturing, which has just unleashed a whole new resource to be accessible. People were looking for the next Barnett Shale all over the country, all over the world. And the Crown Rock team, which John and I knew from prior experiences in the business, the CEO of Crown Rock was previously a CEO.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“To create operational excellence and prove that that was a superior model through returns on capital. And that was the underlying philosophy that we took into Limerock. It was putting together a fund, allowing us to back entrepreneurs and management teams that had developed real value added excellence in individual areas.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Core concept is something that both John and I really saw firsthand at Goldman. The energy industry was a very tradition-bound industry. Most of the companies that I was covering supporting a senior analyst, a guy named Don Texter, big integrated companies as well as very large independents, these were mostly companies that were spread across many basins and many parts of the world. And returns on capital for these businesses were not good. And we saw the Canadian oil and gas sector had developed in a faster way than had it happened in the US. It was a very different regulatory environment and capital formation was done quite differently there. You could back smaller companies with 20 or $40 million very much venture capital startup type financing directly into the Toronto Stock Exchange. That allowed the formation of companies that had management teams that were highly focused on individual plays, individual areas and just were able”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“I started my career a mid-sized oil and gas company in Midland, Texas, which was very much off the beaten path and became mini, many years later the center of the oil and gas universe. I was in their M&A group, which is where I met Jonathan and all the boys at Goldman Sachs that advised us on a number of transactions that we did there. When they started Lime Rock, they plucked me from obscurity to become an investor, moved up to Connecticut, and it's been history since.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“No longer the old two guys. But yeah, we were 28 and 29 when we started the business. We walked around with a pitch that we wrote together to a number of investors. One was to private equity firm called the Beacon Group in New York. They had raised a billion dollar energy fund. And our pitch to them was the actions and the small stuff. It's the entrepreneurially minded, focused companies in oil and gas were the highest returns are going to be experienced. And we felt we were extremely well connected both in the upstream E&P sector and the oil field service sector to tap into those opportunities. The lights were turned on here in Connecticut in the summer of 1998.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Cracker jack with numbers, knows the industry, he'd be the perfect fit for us. And we were joking yesterday as we were talking. John and I were a lot older than Jay when you're 28 and he's 24 and then amazingly life catches up. The year is compressed a little bit more.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“I thought he was a little crazy at first. I didn't understand the industry of private equity, but John was very clear early on that there was a danger in pursuing the natural trajectory of taking public equity research backgrounds and get into the public equity stock management business. There was just far too much cyclical volatility that you needed to invest through cycles with long-term capital. think long term, not think about the next quarter. Whatever he saw in that moment, the foresight to take public backgrounds that we both had and translate it into an investment-minded private manager, I think was just spot on. The other thing that was spot on is the third person in the room that's here. John had worked closely with Parker and Parsley in a merger that they were doing with Mesa Petroleum. We needed to hire people when we're starting Lime Rock. And he said, you need to meet Jay McLean. He is just a...”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Responsibility. It was a very regenerative partnership culture that I think we've tried to copy a bit as it relates to Limerock through time. In the case of that summer of 97, where John hit me with the pitch, my career was in a good place. My personal life was in a good place. I'd just gotten married. The Wall Street Journal, I think, had just named me the top stock picker in the oil field service sector. I was 27 years of age. We had just taken public Santa Fe drilling, which was a billion-dollar IPO that Goldman Sachs was the lead manager of two weeks prior. Amazon had gone public. No one paid attention to Amazon in May of 97. Everybody paid attention to Santa Fe. And for whatever reason, the Kuwaiti government that owned it wanted to go out of its way to tell the higher-ups at Goldman Sachs that I was pretty important on that deal. Things were moving personally and professionally for me. And this guy hits me with this crazy idea that we need to get to the other side. We need to be managing money and investing capital.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“In these businesses, and then you got to keep 20% of the profits. He thought I was crazy. The Goldman experience for both of us, it was a very unique place culturally in the 90s, pre-IPO, it was a unique moment, I think, for research analysts generally. It was the hot decade where if you were in research, you were in the center of the room. You were pitching your ideas to the Salesforce of Goldman Sachs. The walls were porous in investment banking. So if there was a pitch to a client that was considering raising capital, you were front and center in that pitch. You'd periodically get ideas thrown at you from the merger bankers. What if X and Y were to do something so your advice was being solicited? All the while you're digging deep in an industry and learning about a sector and learning about the stocks, the culture of the place was such that if you proved you were capable of doing great work, you got more”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Just became very interested in the idea of becoming an investor, partnering with companies. You learn a lot in investment research. It's kind of a learning curve that flattens out over time. John had joined the group a couple years after I did on the oil service side. So there was a lot of commonality in terms of the themes that we were exploring the industry pieces we were writing. And even though we weren't covering the same companies, we just thought there was an opportunity to invest in exciting, highly focused small cap energy companies. At the time I started thinking about doing this, there were two established private equity businesses that focused on energy. Despite my asking numerous times, neither of them wanted to hire me. The option was simply to set up our own firm. Took me and my wife at the time took Reynolds and his wife to be a beach in Connecticut and I pitched him on the idea of doing this. They didn't believe me when I told them you could invest capital.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Happen to read Michael Lewis's book, Liar's Poker, which I don't think is intended as an inspirational recruitment tool, but it sounded like a really crazy way to spend a few years, learn a lot, send out some resumes, and was hired in the investment research group at Goldman. It was a guy that I went to work for who was an inspirational figure, more for John and I, was hired into the oil and gas research group.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“Happy to kick off. I went to Georgetown School of Foreign Service. I wasn't really finance focused at all. I was interested in international affairs. I studied diplomacy and national security at Georgetown. Passed the Foreign Service exam. You're kind of given a six-month break. At home, delivering pizzas for dominoes, waiting to start my foreign service career. I had a lot of friends who had gone into the foreign service and were not enjoying it.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“That created three times its cost over the last six years of the deal's life. My guests to discuss the firm and its grand slam Crown Rock deal are Limerock Managing Directors John Reynolds, Jonathan Farber, and Jay McLean. Our conversation covers Lime Rock's investment approach and the example of Crown Rock. We dive into the initial investment thesis around vertical drilling, the three extinction threats to the business, innovation in horizontal drilling, management excellence, exit options along the way, and the Forever Hold Mindset that allowed Crown Rock to compound extraordinary amounts of capital. Before we get going, I'd like to welcome you to the first edition of Spread the Word Tank. Entering the stage in front of our sharks is my son Eric.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“When you think about the greatest private equity deals of all time, names like Google, Facebook, Uber, Dell, and Hilton might come to mind. After our recent episode of Private Equity Deals, you might also think about 3G's acquisition of Burger King. But I bet you wouldn't think about an oil and gas play called Crown Rock. Lime Rock Capital created Crown Rock alongside a management team with $96.5 million of cash and assets in 2007. 17 years later, it sold the business to Occidental Petroleum for $12.5 billion. LimRock's original investment made $79 times its money, a net IRR of 18% and $7.5 billion in gains, which ranks in the top 10 of fully exited private equity deals of all time. It also exited a continuation vehicle”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source
“I'm Ted Sides, and this is Capital Allocators. This show is an open exploration of the people and process behind capital allocation through conversations with leaders in the money game, we learn how these holders of the keys to the kingdom allocate their time and their capital. You can join our mailing list and access premium content at capitalallocators.com.”
2025-01-20 · Capital Allocators · Striking Oil – CrownRock by Lime Rock Capital (EP.428) · IDENTIFIED FROM THE TRANSCRIPT · source