This is Ricardo's path to becoming a true entrepreneur — built by two people who believe in him. Orlando is putting in money and his own time to help Ricardo succeed. Joe is handing over a Casago franchise with no money down. Together, they're giving Ricardo everything he needs to build something that's genuinely his own.
The capital stack
Four layers, top to bottom. Casago is pure debt. Orlando's preferred sits above Ricardo's common.
Casago note sits above both equity holders — repaid from cash flows
What we are NOT doing
A traditional PE deal would look like this — three chains that never come off.
1
Complicated hurdles
IRR thresholds, preference stacks, clawbacks. You earn last, always.
2
Majority forever — no exit
PE firm keeps 51%+. No buyout path. Forced exit on the fund's timeline, not Ricardo's.
3
Governance controls forever
Board approval for hires, spend, strategy. Investor veto rights. No end date.
You work for the investor. The controls never end.
PE vs preferred equity — honestly
Orlando's preferred does have governance controls. But they're temporary and tied to a clear redemption path.
PE hurdles
IRR thresholds, waterfalls, clawbacks. Ricardo earns last.
Investor veto on hires, strategy, spending. No end date.
Governance while preferred outstanding
Orlando has controls — but they end when preferred is redeemed. The hill has a top.
"Wow, 3x seems high"
Fair reaction. But look at what comes with it — Orlando isn't just capital, he's on the rope.
Strategy
Deal structuring, market positioning, growth planning from someone who's done this before.
Key hires & relationships
Network access to find the right GM, sales rep, and ops leads — plus strategic relationships with banks, software providers, and other key vendors in the STR space.
Coaching
A sounding board for every tough call as Ricardo builds his first business.
Tough decisions
When things get hard — personnel, owners leaving, cash crunches — Orlando is in the room.
The climb toward redemption
Four stations on the hill. Governance fades as performance builds.
Close
Yr 1–2
Yr 3–5
Yr 5–7
Yr 10+
At close — NewCo formed. Orlando's preferred issued. Governance begins.
Years 1–2 (PIK) — Ricardo builds ops, grows unit count. No cash debt service yet. Governance active — Orlando aligned to grow.
Years 3–5 (seller note) — Business stabilised. Cash flows begin paying down the Casago seller note. Orlando's governance still in place but waning.
Years 5–7 (preferred) — Seller note retired. Focus shifts to redeeming Orlando's preferred at 3x — via profits or SBA loan refinancing. Governance ends on redemption. Ricardo holds 80%.
Year 10+ — The Casago franchise term ends. Ricardo is free — no more royalties, no obligation to stay in the Casago system. He owns what he built, on his own terms.
Year 10: the franchise was the launchpad
The Casago agreement is a 10-year term. By then the preferred is redeemed and Ricardo owns everything he built.
Brand equity
Thousands of SE Florida homeowners know Ricardo's name. Guests return by habit.
