[00:00:00.000] - Chris
Wow. How many of you have listened to the Head, Heart, and Boots podcast? I can't tell you that reaction, how much that means to us. Welcome back to the Head, Heart, and Boots podcast. I'm Chris.
[00:00:11.230] - Brandon
And I'm Brandon. Join us as we wrestle with what it takes to transform ourselves and the businesses we lead. This new camera angle makes my arms look smaller than yours.
[00:00:20.860] - Chris
I'm noticing that, and I really appreciate it. I thought you did that on purpose.
[00:00:24.020] - Brandon
No, I don't. I didn't, and I am not happy with it. What's up, amigo?
[00:00:29.210] - Chris
I'm chewing this Built Puff Bar that Janna stocked our.
[00:00:33.000] - Brandon
They're a little like crack.
[00:00:35.670] - Chris
Oh, jeez.
[00:00:36.570] - Brandon
For those of us that have done rounds with protein bars.
[00:00:40.120] - Chris
Well, they're just healthy enough. They've got 8 grams of sugar versus Snickers with 49 or something?
[00:00:46.470] - Brandon
Yeah, I might have overshuttled.
[00:00:48.040] - Chris
To where I can not feel so miserable about myself when I eat four of them in a row.
[00:00:52.270] - Brandon
Maybe it's more the crash. You don't quite have the same crash orientation that comes off of a... Dude, I do love a I got a freaking Snickers bar, though.
[00:01:02.410] - Chris
I ain't going to lie about it. Well, the peanut butter version of those is dang near close in my heart. It occupies a similar place in my heart.
[00:01:09.000] - Brandon
My heart of hearts.
[00:01:10.370] - Chris
I sent some of the peanut butter puff, a built puff bar, to an industry friend of ours, a client, actually. I was legit appalled when they weren't over the moon. I said, Hey, did you try one of those? He's like, Yeah, I'm not much of a bar guy. I'm like, That wasn't the question, bro. Did you like those peanut butter chocolate puff? He was just relatively unimpressed, and I was completely and utterly appalled.
[00:01:34.340] - Brandon
It was accepted with a flat.
[00:01:35.900] - Chris
I couldn't believe it. A flat, right? I still don't understand. I don't understand who he is as a person anymore, actually.
[00:01:40.050] - Brandon
You're still trying to determine if he's human or not. Jeez. Where are we going?
[00:01:45.120] - Chris
Yeah, at some point we're going to talk about something. Yeah, that's right. Well, okay. We just have more and more clients that we're working with that are interested in some way, shape, or form in selling their company, whether it's in two years or whatever, because they want to retire and get ready, and they're just ready. They have changes in their family, and they want to free themselves up, or they're thinking of it in terms of, someday I want to sell, and I want to make a gazillion dollars. And they've been observing this whole M&A thing in our industry for the last 5, seven years, and they don't want to miss out. They want to be really smart about how they're building their business and whatnot. This year, I have really set out to deepen my understanding of that process and that experience. Admittedly, none of us on our team are finance MBAs or whatever. We didn't go to Wharton or Harvard law school or something like that. And so I just thought, while we've had a lot of exposure and we have a lot of friends and relationships that we've been building in the private equity space and with strategics in our industry and so forth, we've observed the process and been a part of the process.
[00:02:50.480] - Chris
I thought, I really want us to get to a place where we're in more of a leadership inspired position to help our clients, that we have really fresh insight and really integrated thinking about it. I just made that a quest for myself this year. I've really been pursuing that in a couple of particular ways. One, I have a roster of books. I've been having conversations also with ChatGPT, which is just blowing my mind, blowing my mind of just how incredible of a learning tool. Yeah, it's almost like a- The Chat function. It's just unreal. Pursuing in that way and book knowledge and so forth. As I go, as I start finishing some of these books, I'll inevitably be writing blog posts and sharing for the folks that care. Then I'm reaching out to leaders in our industry that are actively engaged in M&A. At a high. At a very high level. Like many transactions and on both sides of the table and so forth have sold and bought. We've obviously been cultivating relationships with brokers because inevitably, part of our strategic role of clients is at times making introductions and helping pull relationships together and so forth.
[00:04:00.190] - Chris
I've had my first few meetings. In fact, today, I had my... I guess it was my second meeting so far. I met with somebody who is the head of M&A for a strategic. Honestly, I'm really excited about it. I'm already starting to synthesize some thoughts. Our industry has really been changing a lot over the last five years as to how we're doing M&A. I think-In course, the influence, too.
[00:04:25.380] - Brandon
Changing expectations on restores. Just what will work in the future, there's a higher level of maturity and competency that's being required for you to continue to stand out in the market and be ready to exit when that time comes.
[00:04:40.960] - Chris
It is so true, and it, without a doubt, has become a more sophisticated game. I was talking with Andy Z at Custom, and he's just a really highly regarded leader in the industry, and I didn't really know him very well until this conversation. But one of the things he talks about is just how much it's elevated their business, having building Building relationships with more and more sophisticated business people and him being willing to shift and grow as a professional. And by the way, this is coming from somebody that is already, I think most people would say, his achievements and the companies build and the culture of custom. I'm still just learning more and more about...
[00:05:19.600] - Brandon
There's a lot of winning happening.
[00:05:20.840] - Chris
Oh, and discipline and all those things. But him just talking about just how much that's benefited their business of working with all the folks that you end up working with, the lawyers and the finance people and all the various roles that you start to associate with as you begin acquiring companies and just how beneficial that's been to their native operations and improving their business and improving him as a leader. But I think one of the themes that starting to emerge is that, one, full buyouts are pretty rare. When this first wave of acquisitions happened, let's just call it 10 years ago. I know there was some that came much earlier than that, like the early Belfort transaction, I think was 14 or 15 years ago or something of that sort.
[00:06:01.410] - Brandon
It feels like the mega push was even within five years.
[00:06:04.670] - Chris
Yeah. I mean, a lot of activity in the last five years. Yeah. American restoration fleet, right. Dms has been on a terror the last four or five years. Obviously, first on site, ATI. Much of that has happened in the last five, six years. But early days, and even as recent as three, four years ago, there were a lot more full buyouts where these owners were just cashing in their chips, leaving. New brand takes over, renames the rigs, right. Centralizes around a new job management system, all the things. And now all of a sudden, that location is a XYZ location, a restoration company. And I think, unfortunately, there was a lot of carnage. And many of us have heard all the woes of working with PE. A lot of people have a bad perception of, Oh, you partner with PE, and they're just going to tear apart your company. It's going to bleed your culture out.
[00:06:53.810] - Brandon
No heart.
[00:06:54.730] - Chris
No heart, all this stuff. Human value. And that has been some people's experience For sure. But I think one of the drivers behind that is that you take the owner out of the equation, and a lot of that structure, a lot of that culture goes away. It speaks to something that you and I have been aware of and conscious of, and I think many of the leaders listening to this are aware of, which is just how critical it is for owners to replicate themselves within their business. I think a lot of us as owners, we get so busy about building our company, building our scale, grow, grow, grow, grow, We're not shoulder to shoulder with our techs or our trades people or our PMs or anything anymore. But we still never quite got over the hump of actually developing leaders within the team with the intention of mentoring them up. And ideally, I think the best leaders that you and I see are the ones that actually grow and develop their people to exceed them in their skill and capacity to lead the team. But that's the ultimate. It's the ultimate. It's because then when I as the owner exit the business, the business is just as healthy as the day before when I was there.
[00:08:04.680] - Chris
Because the competence of the leaders actually grew to a point where it exceeded my own. And I think that actually not only is it possible, although difficult, it's likely if we invest in it because it's our downline leaders that are able to maintain a connection to what's happening on the front line. And as we get more and more wealthy and we become more and more removed, we get more and more focused on real estate and location expansion and all the things that hopefully you as a CEO are starting to prioritize more, you are inherently less connected to the front lines and to your customer without an enormous amount of effort. And so not only is it possible for your team to become better leaders than you are for the business and for the culture, but it's likely if you do it the right way.
[00:08:49.740] - Brandon
It's so interesting timing. I think you and I were talking about this before where we tend to get exposed to several... We'll just see a spurt of different engagements and none of them necessarily being oriented intentionally around the subject matter, but there's these themes that pop up. Two things just happened recently over the last several days that align with what you're talking about. One, we had just a great catch-up conversation with Frank Springer today. That dude, I don't care who you are in the industry, but he just tends to have a lot of wisdom, and he's very well grounded with the way he thinks about things. He was talking very directly to this idea that he's always found there to be a ton of value in teaching business leaders this idea of how you cultivate or create company culture. That it's not a... It's a plan. It's no different than a strategic plan. It's this idea of, okay, we want the culture to do X And so how are we going to build and design it so that it actually produces X? You know what I mean? And then another series of conversations I've been having with just clients.
[00:09:54.550] - Brandon
We're at the very beginning of the year, a lot of launching activity and bursting into to 2025 and digging in and starting to take action against a strategic plan or whatever the case may be. And inevitably, you end up getting caught in these... Not caught, you end up getting in conversations with leaders to remind them of their core function. Because we just get so swept up in the tyranny of the urgent, the day-to-day, that you begin to lose connection to what is the fundamental of your role? And so I just had some notes here I wanted to reference because I think it really ties in to what you're saying is we We have used the, I don't know if it's like the picture of a repeater. This idea that you have a communication system in a large commercial building. It's starting somewhere. That signal then gets pushed out to a hallway, a wing. Then if we don't have these repeater devices and certain interfolds throughout the structure, the clarity and the message quality.
[00:10:56.150] - Chris
The strength of the signal goes down.
[00:10:57.420] - Brandon
It begins to die and fade away. We think about that similarly to leadership responsibility within our ranks. The idea is that we want to orient our leadership around this concept that you are a repeater, and your job is to capture this most important message, reamplify it back to its full power and then push it out into the wing, the division, the part of the business that you have influence over. If leaders at all the appropriate tiers, whether it be multiple locations, divisions, departments, service lines, whatever you want to break it up, it's this idea that those leaders know the owner or the CEO has created a vision for the organization. And my job is to fully understand and be totally bought in. And this is important to be totally bought into that vision. And then my job as a leader in my ranks with my sphere of influence is to reamplify and power up that message, not to change it, and to resend that out to my direct reports. By doing so, for instance, we begin to create a system where the culture is being led and managed by the entire organization, not just the owner.
[00:12:13.080] - Brandon
That's one of these just major influential roles that the owners have. And if they haven't created this understanding or connection with their leadership team, that their role is to be that repeater, then you pluck that person out of the system and no one knows how to function.
[00:12:29.880] - Chris
Yeah, It's a major disruption to the whole business. Major, right? So there's a couple of takeaways that it just reaffirms to me in these conversations. The reason why so many of these M&A transactions were falling flat or into chaos is just that. We had a number of these iconic, powerful restoration entrepreneurs. And this doesn't take anything away from them necessarily. It's like this is how many of us were trained to grow our business and call it some version of command and control. You have a really charismatic leader at the front that's driving all the right behaviors, focused on the right things, honoring the customer relationship, doing quality work, speed, efficiency, effectiveness, driving all very, very successful executive owner leaders. But in some spaces anyways, hadn't been able to at that point or just didn't prioritize building that downline leadership structure. And so ultimately, these PE companies had a really difficult time recapturing the value that they'd invested into that business. And so now what's more and more common place is an earnout. And the earnout is a great way for that PE company to hedge their best because they might purchase in the first part of that transaction in their letter of intent, they might only be purchasing 70 % of the business from the owner, which oftentimes results in some really big numbers going to their bank account.
[00:13:49.820] - Chris
For sure. Yeah. And some of you listening to this, you had friends or you yourself have gone through this transaction. So you get your big, big, big check. But then you've got, say, three years or two years of an earnout where you're going to stay engaged. That's an insurance policy, right? To hopefully, at the very least, your influence over the business, if you hadn't built out your leadership structure by that point, is going to at least create some stability so that the company can keep growing, which, of course, is what the PE company wants it to do. But I think there's also a takeaway, too. Of course, this is what we aim to help our clients with. Because ideally, I think most owners would say, Ideally, when I get ready to retire, I want to do whatever the What the heck I want? I want all my money. Actually, we know of a very successful operator. We had him on our show recently. He cashed out and walked away. The only way he was able to do that was he had created such an effective leadership structure and culture in his business and operational structure that he literally did not have to be involved anymore at the time of transaction.
[00:14:52.720] - Chris
It was pretty dang obvious to anybody that visited their business. I have to think he had the invest. It's not a hard sell. He had the investors show up. I can just see how he would have sold it, too. Hey, come on by our business. I'll show you. Just give me a few days notice. But he had these investors show up. He walked them through just like he walked us through. It's pretty obvious that this owner had very little to do with the day-to-day operation. That's right. Therefore, you could reasonably assume, Hey, we can pluck him out, put in some competent leadership, and then take this thing to the moon. Yeah.
[00:15:24.730] - Brandon
Well, in fact, in their case, really, the competent leadership was already there. Hint, really, that his participation in the organization at that point is I'm an owner. This is still my asset, and I want to make sure I understand what's going on.
[00:15:38.990] - Chris
I don't know why we're talking cryptically because I think Rocky wouldn't care. Oh, no. Yeah, Rocky Hensley, right? So Icon Restoration in Cincinnati, He just recently sold that successfully, I don't know, a couple of months ago or so. He got the money he wanted, and he got it all. And it is because of how he chose to build that business out. He did it very intentionally. Of course, he's a serial entrepreneur, so he knows things that a lot of us didn't know that I hadn't run other companies before. But I think that is the takeaway for people listening to this. And for us, as we work with clients, is, look, you have some control over how you want this to look when eventually your day comes and you decide, I'd like to hang up my hat and do Something like, I'm going to say something else.
[00:16:15.540] - Brandon
There's a clear path to create options.
[00:16:17.950] - Chris
There is a clear path to options. And you have all the power depending on how you build your business. Because there will always be a buyer who will pay top dollar for a business that is turnkey, is making healthy profits, has a healthy team in place that can adequately lead and grow the business as they stand today. There's always going to be somebody that will pay a premium for that.
[00:16:43.930] - Brandon
You know what's That's interesting. I think part of what this topic reminds me of, too, is just the ego check required. I wrestle with this. I mean, I've had, probably more so in the last six months, more of a wrestling match around this as I It sounds so counterintuitive. As I give up more control of the business because the people we're hiring are better than I am, which is exactly what I want in owning an organization, my intentionality was to create a scaling business that we could hand off the day-to-day leadership over time to competent, capable leaders. We're doing that. I'm in the midst of doing that. And my ego gets freaking fired up every gosh damn step of the way. I've caught myself in a meeting this morning where one of my key leaders who is just capable is on a conversation with myself and somebody else in the industry who we trust and respect. It's like, I watch this person who I've hired and trust and want to continue to develop their leadership capabilities and relationships, networking and making his own relationships, and there's this part of me. It's all fired up. I'm like, no, no, wait a minute.
[00:17:57.060] - Brandon
Now, wait a minute. It's like, those are those things I think that create little traps along the way. I think, principally, people understand, well, any business I don't have to show up for it to continue to be successful sounds rad, and it sounds exactly what I want to do. But it's these little roadblocks, these little traps that we get stuck by that make it difficult for us to lean in and actually create a consistent path towards that outcome. Those ego checks, a little bit of a jealousy check that kicks in. And again, I don't want to project on anybody. Maybe I'm the only Neanderthal that struggles with this, but it's a good reminder. And I think that this topic that you're addressing or that we're approaching right now is this idea. It's a reminder of, look, dude, don't get high-centered on the little shit in route towards the big thing, which is ultimately at the end, when you decide it's time to sell, you want to have as much control, influence, and options available to you as possible so that ultimately what you end up with is what you worked so hard to get and not some compromised, bastardized version of what you were hoping to experience.
[00:19:08.970] - Chris
You know what I mean? Liftify. Com/bloodlight. You've heard Brandon and I talk a bunch of times about the importance of Google reviews. Maybe even heard our episode with Zack Garrett, the CEO and founder. Recency, consistency, two of the most important things when it comes to maximizing the benefit from your Google reviews. Why not use an outside partner. Liftify is targeting 20 to 25 % conversion, right? So if you do a thousand jobs a year, you ought to be adding, right now, 200 to 250 reviews a year, every single year. If you're not doing that, you owe it to yourself to get a free demo from liftify. Com. See their system, see how it works, see how affordable it is. I promise you, you'll thank us. Liftify.
[00:19:53.930] - Brandon
Com/bloodlight. We spend a lot of money and a lot of attention trying to get that first call. And one of the One of the things that we do once it happens is, sometimes we leave it to chance. Who picks up the phone? How do they respond? How do they walk that client into a relationship with us? Well, one of the benefits of partnering with a team like answerforce. Com is we can systemize that, we can make it more consistent. We can also have backup for when our teams need that help. Somebody goes on vacation, somebody's out sick. We get a storm search, we get cat event. All sorts of things can have an impact on how we receive that client. But the most important thing is they They need to know that they've chosen the right team. And so answerforce. Com can support you, be a bolt on partner to help you consistently produce an awesome onboarding experience with that first call with your client. So answerforce. Com/ bloodlight.
[00:20:46.270] - Chris
That's great. Cnr magazine, we're friends with all the folks at CNR. Michelle and her team, they do a great job of keeping their ear to the ground and reporting all the important information from our industry. You want to stay up on all the M&A activity and what the latest best practices are for selling your company successfully? She's got that. Great articles about all the four quadrants of our business. Cnr is constantly pushing out great material and leveraging great writers and subject matter experts in our industry. It is the water-cooler of our industry. So if you're not subscribed, go to cnrmagazine. Com. Follow them on LinkedIn. Follow Michelle on LinkedIn. Trust us, if you're trying to stay on top of everything happening in the industry, your best destination is C&R Cribs. Com.
[00:21:31.010] - Brandon
You guys, many of you have already heard about Actionable Insights and the training and the technical expertise that they bring to the industry. But how many of you are already leveraging the Actionable Insights profile for Xactimate? That's the game changer. It's essentially an AI tool that's walking alongside of you as you write your estimate, bringing things to your attention that should be added, that could be considered. All of them items that increase our profitability, increase the effectiveness and the consistency of that scope. It can do anything from helping a new team member assimilate some estimating best practices. It also helps the grizzled vets add back that few % that we've just forgot over time. So actionable Actionable Insights, getinsights. Org/ floodlight, and take a look at what the Actionable Insights Xactimate profile could be doing for you and your team.
[00:22:26.290] - Chris
Back to this trend, right, that now these PE companies have gotten smart, and it's not like this is a new thing, right? Eurnouts have always been a part of M&A transactions to one degree or another. But it definitely has become more customary now that there's an earnout associated with a purchase.
[00:22:42.890] - Brandon
Well, and I think ultimately, too, what you're I'm thinking about, dude, is the idea that if the system can't sustain itself without you being present, there's no one that's going to give you money without having that as an option. Whereas I think what happened, you referenced Rocky. Again, they didn't offer. I don't think the original offer came across the table without earnout. But because he knew exactly what he had and because that organization could show up tomorrow and do exactly as it done the day before, even if he wasn't present, he could push back and say, No, I don't want to learn out.
[00:23:15.620] - Chris
Don't you want to be Rocky?
[00:23:16.770] - Brandon
Yeah. Don't you want the option?
[00:23:18.400] - Chris
Because, right, here's the thing, right? And certainly, Rocky is not the only one that's been in a position like this to dictate the terms, so to speak. But you want to have that option. You want to hear their offer and say, Nope, I'm going to need this if you want to buy this and to have a much better chance of getting your number on your terms. But the only foolproof way to do that is for you to build out your business in a very specific way. And it's not rocket science. It's really actually putting yourself in the shoes of the investors. And some of you that are listening to this, you have bought other companies. You've purchased existing businesses before, so think about it. Think about how you are approaching purchasing that business. Let's just say you buy some small mom and pop business, and they want five $100,000 for their business to walk away. And you start looking at it and you're like, shoot, these owners are working full-time. So I'm going to have to replace them. I'm going to have to hire... I've got two FTE at a high level of business. I'm going to have to hire a GM and maybe an ops person to run this thing?
[00:24:16.770] - Chris
Well, there's $250,000 plus with burden and everything else. Okay. And I'm going to have to do all of that rigmarole to find the right people to replace these owners who are actively operating. You as the buyer, You're like, It ain't worth 500 grand. It's almost effectively worth nothing. Yeah.
[00:24:34.270] - Brandon
What happens when the core client relationships really exist because of the owner and the owner's relationship with them? That business is literally worth zero dollars post their ownership.
[00:24:49.320] - Chris
It's worth your fleet.
[00:24:50.620] - Brandon
It's worth your-Your overly depreciated assets.
[00:24:53.210] - Chris
It's worth your fans and deals. It's worth your equipment in that. And of course, none of us ever want to be in a situation where the primary conversation is, what is your inventory and fleet worth?
[00:25:03.800] - Brandon
That's right.
[00:25:04.070] - Chris
All of your blue sky, all of your blue sky is ultimately associated with what organization have I built? What leadership system have I put in place? What does the business require of me as the owner? And the closer you get to nothing, the more valuable your business is.
[00:25:26.220] - Brandon
Well, and I think, okay, so here's what's, I think, most relevant to where you're leaning is. When we know... Okay, anybody listening, for instance, that grew up in the era of GI Joes, okay? Now you know, and knowing is half the battle, right? This, the cheesy closer on every Every episode of GI Joes. And I think that that's what we're talking about here. There's access to the fundamentals of what these entities are looking for. All of us have friends, peers, people in our network that have closed in transactions. They're in the middle of some transaction. They're actively engaged in at least the exploratory conversations, and they're being told. There's a lot of great resources. Go Cool, JT, right? Even Mark Springer as an individual, he has a profound amount. There's a lot of people in the industry to connect with and get a vision for what is it going to take so that it puts you in that position of now you know and knowing is half the battle. Now you can begin to build a business that will give you what you want. And I think the opportunity in that is that the sooner you begin to design a plan for what you want when the game is over for you, it allows you to prioritize the right decisions now.
[00:26:40.010] - Brandon
More importantly, man, it helps you hold your mind in check. Because, again, going back to that ego thing, we just think about where we get our points of pride as owners in business. We work all the time. We understand every facet of the business, every relationship we're connected to. It's all the wrong stuff.
[00:26:58.690] - Chris
Yeah, it's not a badge of honor.
[00:26:59.950] - Brandon
It's not. But it's hard for us to know that if you're not aware of where you want to go in terms of options, right? And I think that's fundamentally like a little soft pitch here. The biggest investment that we made last year was redesigning and recommitting our consulting model to start and begin on the basis of, let's go out five years, let's go out 10 years, and let's start talking about what you want for options. Because once you know that, we can begin to go backwards and create a plan. Then every day when you show up to work, you're making progress on strategic initiatives that do what we're talking about. Instill succession planning creates a leadership communication platform in your organization. It's transferring your vision that you have for this thing that you're creating and instilling it down into your ranks, right?
[00:27:55.020] - Chris
And I think sometimes we overcomplicate in our minds. I certainly be guilty of at different points of my career and owning businesses, is some people will think that you and I are talking about $20, $30 million companies, that they do this stuff, or they should be engaged with this. But when you're a small mom and pop, and maybe you're even still getting out in a truck and managing some projects as an owner, that this isn't for you. It's just nonsense. There are some companies and brands that they've been operating under this leadership principle and this business building principle since inception. I think of a couple of things. We have friends that came out of the College Pro painting. In fact, one of my really good buddies, he was in College Works Painting. Very, very successful. I was in Cutco. I ran a Cutco sales office, and it was all built on the premise of succession planning from the start with 19-year-old kids. Oh, yeah. It was these are the different behaviors you're doing week to week to train and equip the people beneath you. Your superintendent on your painting crews, you're trying to get them to run essentially a branch their following summer.
[00:29:03.300] - Chris
So kick ass with a single crew. And then they run their own crew, and then you become a division manager, and you elevate to now you've got 16 teams running and four district managers that are working for you. And there's this career progression that's built into the business model. That begins when they have three of their buddies working for them on a paint crew. There's a very specific cadence of behaviors of one-on-ones, There's a transparency that's built into it of, let me show you what I do so that you can learn what I do and eventually take my job while I go do another job. A hundred %. And so I think we just missed that. And that can literally be done shoulder to folder with you as an owner who just bought your first Voda Cleaning and Restoration franchise. You're still running the machines, but you've got your helper in the front seat. It's about giving the attention in the time to explain to them for what you do. It really is that simple. It's, hey, it's when you- That's the fundamental behavior. It's when you stop at Chick-fil-A for lunch and you talk about what's happening during the day and how you're thinking about it.
[00:30:12.270] - Chris
Hey, I need to check on our invoices we sent out and see how our AR is doing, accounts receivable. Do you know what that is? Okay, well, these are invoices we sent out, we've not yet gotten paid on. Let me show you on Quickbooks here on my iPad what I'm looking at. It's progressively teaching the beneath us how to occupy the seat that we're currently in and then always doing that.
[00:30:36.290] - Brandon
Yeah. Mark this morning, again, when these things happen, it's like... So Mark this morning, he said there was two things that his personnel would rapidly or very quickly become very well-oriented around. And that was, you've got two things that you have to learn how to do extremely well in my organization. And that is, learn how to coach people and learn how to interview and hire people. So think about that. That is the bedrock for sustainability and scalability inside an organization. He just identified that early and it became a pillar, right, of expectation, because it's what you're talking about. If you have a culture of coaching where the internal guts of the company is around developing and communicating the why behind our actions and our activities and how they align back up to core values and the vision for the business and where we're going and what we're trying to accomplish, you create this succession path, this career pathing that does exactly what you were talking about. The other thing that pops up for me in this subject, because I think it's easier for us as a listenership to maybe get hyper-focused on, oh, well, this only applies to owners.
[00:31:40.600] - Brandon
Okay, well, let's think about downranks. Let's think about downline. If you come When you come into an organization, let's say, because you follow this podcast, you listen to shows like us, you work inside some group, YouTube, research, book reading, whatever you're into, if you're learning the value to the organization's owners of what it looks like to create succession planning and this conviction that in order for the business to be worth a lot of money someday, it's got to exist outside of the actions that the owner is taking. The owner doesn't necessarily have to lead that charge. It is very realistic for you to take extreme ownership, right? I mean, this is total like 101 out of Willings' books. Taking extreme ownership for the outcomes that you participate in and that you have influence on and think about how you can influence up the chain of command. Well, if you know that this ultimately serves as the best outcome for the owner of your organization, even if you're not being taught this right now, you could easily approach the owner of that organization and say, look, in my effort to help create a ton of value for the spend that you have in my wages, I've really been thinking about the business from this perspective.
[00:32:56.490] - Brandon
I've been thinking about what's important for XYZ's the owner long term. And this is what's been rattling around in my head. You probably want a business that's worth a lot because it doesn't demand you to be present every day, right? And then for you to proactively communicate back up, hey, I've been thinking about the business this way. Here are some things I think we can do, and ultimately, I could take on to help create the outcome that I think is probably really valuable to you. Yeah. Imagine, okay, and if you're an owner or a key leader listening right now, Imagine what it would be like if you had person in your ranks walk up to you and say, Man, I've really been thinking about your business, and I've been trying to wrap my head around how I can help create value for you. This is what I've been chewing on. If you would be floored, you would immediately see the long term value in that person.
[00:33:49.650] - Chris
We know because we have people on our team that do that.
[00:33:54.170] - Brandon
Because we experience that firsthand.
[00:33:55.540] - Chris
It's true, but there's nothing better. There's nothing better and it's an owner. That's right. Now, of course, some of you may say, Well, I've done that, and they crapped on my idea, and they said no. And granted, yes, I think all of us have had that experience, too, where that owner is just not tuned in to these kinds of things. But without a doubt, there is someone somewhere else that will. And ultimately, that's what we all have to decide.
[00:34:17.170] - Brandon
Sometimes you just behaving in such a way that's oriented around that can win your audience over. Even if you pitch an idea and it lands on some infertile soil at the beginning, It doesn't change how you can coach your team up, how you can create succession planning under your ranks, under the people that you're leading. So that an example, it pops up. When somebody falls out of the system for whatever rhyme or reason, they see how quickly the team under your leadership was able to step in, fill the gap, and continue to march forward as if nothing happened. And you get to talk about that openly. Man, I'm so thankful we did XYZ. It really put us in a strong position to continue our pace, even though this happened. Sometimes proof's in the pudding.
[00:35:03.420] - Chris
Yeah. Well, this whole M&A thing, I just think that's one of the ways that people can really have control over their destiny. Those of you that still have some runway, right? You're maybe in your 30s, you started your restoration company a few years ago, or you're taking over for mom and dad started the company, and now this is your run. You've got some time in front of you to put in. Oh, man, there's just all the potential that you've seen, all the rewards. It's all there. It's real. It's like there is so much money that is still focused. Wayne on our team, it just brings us up a lot. It's like, did you know that the number one job coming out of these schools like Wharton, Harvard, Yale, right? They're search funds. You know where the search funds, these investment companies are oriented towards? The service sector, home service sector, disaster restoration. There are more MBAs coming out of school that are working as analysts and sourcing deals, hunting for people just like you to put money into. That's right. But or and, they're oriented around all these best practices that we've been talking about because they're trained how to manage risk and make money.
[00:36:11.080] - Brandon
They're protecting themselves.
[00:36:11.890] - Chris
They are completely and totally oriented around managing risk and making money.
[00:36:16.900] - Brandon
That's right. Storytelling doesn't fix the lack of fact.
[00:36:19.990] - Chris
Yeah. And they don't care how much your customers love you. They don't care how long your employees have been on board. They're looking at what are the risks here and can we make money? And There are some fundamental things you can do to build out your business in such a way that they look at that and it's a, yes. It's a, wow, this seems very low risk because of X, Y, and Z. And, wow, can we continue making money with this platform?
[00:36:44.880] - Brandon
I just one final thought on this, man, is that I think it's very similar to when we allow there to be a communication gap with our clients, and then it forces them in a position to begin to trying to solve problems on their own. A big part of me about this is our responsibility to our downline, our people, is if you were to leave that business unsupported because everything had to come through you, when you do walk away, you're ultimately leaving that team at the mercy of what other organizations will attempt to do to try to solve the problems and fill the gaps that exist in your wake. It's like the better and more proactive that you've been at creating a system, a sustainable behavior of processes that has created consistent growth and results, your teams will be honored and respected and asked to just keep doing what was working.
[00:37:42.630] - Chris
That's exactly right.
[00:37:43.470] - Brandon
It's almost like Those gaps we allow to exist are going to force our people for pain because people are going to try to solve those problems, and often, they don't have the background that we do to do it.
[00:37:54.640] - Chris
This is the thing, too. I've heard people lamenting, Oh, we had a PE company come in here and they'd killed the golden goose. Listen, no one kills the golden goose. It's much more likely you thought you had a golden goose because your top line was rad and you made profits. That does not make a golden goose. Yeah.
[00:38:12.570] - Brandon
A little more complexity.
[00:38:13.410] - Chris
A little more complexity Because, again, if you are part of the golden goose, you remove the head from the golden goose. You don't have a golden goose.
[00:38:21.270] - Brandon
Yeah, that's true.
[00:38:22.970] - Chris
It's just these things. It's our egos. Our egos get in the way of this stuff, and we like to be valuable and involved. That's a really tough... You We talked about this earlier. As owners, we really love to be the linchpin in the business. There is something, whether we say it out loud or not, all of you are like, no, I don't. I want leader. Okay, we all know what we're supposed to want, but the feeling, it's real. Our actions, it's real. Our egos really work overtime to protect our self-image. It causes us to not prioritize things that are in our benefit, sometimes until it's too late. Then it just means a reduction in the value of our business a smaller number in the letter of intent than we had hoped for for so long. That's right. But again, some of you are still in a position right now where you can affect that. You have enough time horizon for you to work through these things. Love it. So there we are.
[00:39:13.080] - Brandon
There we go. Thanks for hanging out with us, guys. And we'll see you next time. All right, everybody. Hey, thanks for joining us for another episode of Head, Heart, and Boots.
[00:39:23.130] - Chris
And if you're enjoying the show, if you love this episode, please hit follow, formerly known as subscribe, write us a review, or share this episode with a friend. Share it on LinkedIn, share it via text, whatever. It all helps. Thanks for listening.