Our teachers today are Annalise Dragic and Zoe Zhao, co-founders of Azlin Software, a next-generation serial acquirer of B2B vertical software companies focused on the providers of essential services and care for families.

Annalise and Zoe share how their friendship evolved into a co-founding partnership, the 150 conversations with founders and investors that shaped Azlin from a blank page, and the four values they distilled into the acronym CARE. They explain why they chose family services as their first vertical, what culture-led and technology-led growth look like inside a company of companies, and the role of their AI agent Lumos in keeping the team intentionally lean.

The conversation also covers their first acquisition of Fusemetrix, a UK software business serving leisure and attraction operators, the shareholder base they have assembled including Nic Humphries of HG Capital, Mitch Rales, and Will Thorndike, and the equity-efficient permanent capital structure they have designed to align every party for the long term.

Please enjoy class with Annalise Dragic and Zoe Zhao.

For the full show notes, transcript, and links to mentioned content, check out the episode page here.

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Timestamps

(00:00:00) Welcome to Joys of Compounding

(00:04:38) Episode Intro: Annalise and Zoe

(00:06:00) Friends First, Co-Founders Second

(00:07:45) How Annalise and Zoe Met

(00:08:53) Should Co-Founders Be Similar or Complementary?

(00:10:06) Tech & Investing Backgrounds

(00:12:57) Annalise's Journey From LinkedIn to Investing

(00:14:08) When Entrepreneurship Took Hold

(00:16:29) Building With a Close Friend

(00:18:33) Defining & Managing Burnout

(00:20:46) Beyond the Resume

(00:24:25) The Mentors Behind the Founders

(00:27:34) The Nic Humphries Effect

(00:29:34) Lessons From Visma

(00:31:48) The Co-Founder Questionnaire

(00:34:36) Why Choose B2B Software?

(00:35:51) The 150-Person Benchmarking Exercise

(00:37:14) Pioneering as Female Founders

(00:39:25) The Name Behind Azlin

(00:40:58) Azlin's Vision in Two Words

(00:42:10) Why Acquire, Not Just Invest

(00:45:40) What Makes a Great Target

(00:46:16) The CARE Values

(00:47:44) Investing in Family Services

(00:51:28) Culture as a Multiplier

(00:53:21) Building AI-Native From Day One

(00:58:15) The Case for Equity Efficiency

(01:02:49) When AI Isn't the Answer

(01:04:58) Surprises From the AI Wave

(01:06:52) Aligning Incentives for the Long-Term

(01:11:35) Acquiring FuseMetrix

(01:12:32) Life After the First Deal

(01:14:27) The Levers of Compounding

(01:17:24) A Compounder of Compounders