In this discussion, Adam Wyden, founder of ADW Capital, and Chadd Garcia, a portfolio manager at Ave Maria Mutual Funds, dive deep into the transformation of APi Group. They highlight the company’s shift from one-off construction projects to a thriving recurring revenue model, emphasizing the value of strategic acquisitions. The guests explore the empowering employee ownership culture at APi and how it drives engagement and growth. They also analyze the impact of the Chubb acquisition on fire safety services and the broader implications of market dynamics on investments.

This is Zack Fuss, an investor at Irenic Capital, and today we’re breaking down Archaea Energy. Archaea is one of the largest and fastest growing providers of renewable natural gas in the US. The company uses methane produced by landfills as its feedstock to create renewable electricity and natural gas.To break down Archaea, I’m joined by Chadd Garcia. Chadd is lead portfolio manager of the Ave Maria Focused Fund and co-portfolio manager of the Ave Maria Growth Fund.You may have seen Archaea in the news this week. On Monday morning, BP announced a deal to buy Archaea for $4.1 billion US. We recorded on Friday before this news broke. The bulk of our discussion, therefore, does not touch on BP. It serves as an explanation for what BP has bought and why they found it to be an attractive asset. At the end of our conversation, we asked Chadd for his quick reaction to the news. Please enjoy this business breakdown of Archaea Energy. For the full show notes, transcript, and links to the best content to learn more, check out the episode page here. ----- Business Breakdowns is a property of Colossus, LLC. For more episodes of Business Breakdowns, visit joincolossus.com/episodes. Stay up to date on all our podcasts by signing up to Colossus Weekly, our quick dive every Sunday highlighting the top business and investing concepts from our podcasts and the best of what we read that week. Sign up here. Follow us on Twitter: @JoinColossus | @patrick_oshag | @jspujji | @zbfuss | @ReustleMatt Show Notes[00:02:59] - [First question] - Defining landfill gas and its historic and current state[00:05:50] - What Archaea is, their business scale, and economic profile[00:07:44] - The waste hauling value chain and how money is made in the ecosystem [00:11:33] - How Archaea takes something that’s perceived to be worthless and profits from it[00:15:47] - The way the company is organized to capture and capitalize on this opportunity set[00:17:56] - How much visibility they have into their future earnings[00:19:04] - The renewable fuel standard and how revenue is derived from it [00:20:10] - Explaining how you produce renewable natural gas from a landfill[00:24:52] - The unit economics of a single Archaea landfill to gas site [00:25:40] - How much capital can be deployed into one of their projects[00:26:45] - What differentiates and makes Archaea defensible from private equity companies [00:27:51] - The history of the company, how it was founded, and its major players[00:29:57] - Thoughts about the size of the untapped opportunity in this sector[00:31:57] - Where is Europe in doing something comparable to this [00:32:59] - Free cash flow conversion and financing requirements[00:34:18] - The current state of the competitive landscape   [00:37:37] - The key risks for a business like Archaea[00:40:30] - Lessons learned from studying Archaea from an investor’s and operator’s perspective[00:43:02] - His reaction to the news of Archaea being purchased 

Chadd Garcia, Vice President & Portfolio Manager at Ave Maria Mutual Funds, shares his extensive experience in investment analysis, particularly focused on Texas Pacific Land Corporation (TPL). He dives into TPL's transformation from a railroad post-Civil War to a thriving resource management powerhouse. Chadd discusses the impact of fracking on land value, TPL's strategic entry into the water business, and its unique long-term shareholder base. He also critiques management's incentive structure and the recent shift from a trust to a corporation, raising concerns for investor alignment.