Playing Offense or Defense With Your Company's Value with Ben Vance

Joshua Wilson: 0:31

Good day, everybody. Welcome to the Deal Podcast. Guys, this has been such a great road show. We traveled from Lafayette, Louisiana to Baton Rouge, and we're being, uh, hosted by Jeremy and crew at ThreeSixtyEight. This is the last one of the day. We did eight interviews over the last few days. This is number eight. And, uh, we're super grateful. Jeremy and team, thank you for having us. Uh, team back home, FA Mergers, we sell middle market businesses, Jude, Chase, and then I've got Scott next to me. Uh, this show is powered by That team. And the reason we do it is because we wanna inspire the future generation of deal makers. As, you know, middle market guys who sell businesses, uh, we see the, the future of entrepreneurship being vital, and we really want to inspire that, that generation to look at deals through maybe a different lens. Not fear, but hope and opportunity. So what we do is we tap into our network. All of the people that have come on the show have devoted their time, energy, effort, and have driven to the studio to share with you, our audience, wisdom, knowledge, experience, some tears, some, um, great experiences, so that way you can learn. So our ask for you is that you reach out to the guests and say thank you. Let's be a community of gratitude. Enough of me talking. You're gonna hear a few different voices. To my right is Scott Shea. Scott, say hello. Good morning, afternoon, evening, whatever. Man, it is afternoon, buddy. I'm on my fourth cup of coffee. Across from me, Jeremy. Jeremy, say hi.

Jeremy Beyt: 2:14

Hello.

Joshua Wilson: 2:15

Yeah. And then an esteemed guest, Mr. Ben. Hello. Thanks for coming. Yes. So Ben, before we dive in, man, you are experienced in podcasting, right? You've got your… You guys got a show, and you've been on a bunch. Why don't you give a little shout-out to some of the podcast work that you've done?

Ben Vance: 2:32

Yeah, I've been on a, a few since I sort of made my way back into public accounting. Um, I've been on a couple of local ones. The Confident Exit, Horizon Wealth Management, Pete Bush, uh, has had me on a few times, and then our firm, Faulk and Winkler, does one called Business Sense that covers a variety of topics, but I was a guest talking specifically about exiting and transactions and kind of business readiness for sales.

Joshua Wilson: 2:57

Yeah, man. Super cool. Well, thank you for making the drive. How far of a drive was it for you to get here?

Ben Vance: 3:02

For me, it was eight minutes from our office, so.

Joshua Wilson: 3:05

Terrible question, Josh.

Scott Shea: 3:06

Yeah.

Joshua Wilson: 3:06

Hey, I drove 10 hours to be here. How far did you drive, Scott? So all right. So Ben, um, when asked to do this, uh, why did you say yes, and why do you think podcasts are, are meaningful to you in your business?

Ben Vance: 3:20

Well, great question. So before, when I was at my first stint in public accounting, I guess podcast, it's dating myself a little bit, but podcasts were a little newer, and it was a, a way for us to… We never pulled the trigger. We planned a lot about doing it, is how can we better educate our current clients, future clients on all the things that we see, all the mistakes that we've seen business owners make, successes? It's just another format of, uh, of learning that I'm sure we've all grown accustomed to just putting the little ear pods in your ear, whether you're walking, exercising, sleeping, or whatever, of just absorbing information at all times. So I just think it's a great medium. Um, and when Scott reached out, I've known Scott for a while, uh, just welcomed the opportunity to not only meet you guys, but another platform to just share some of the things we've learned and what we do.

Joshua Wilson: 4:06

Yeah so what do you do?

Ben Vance: 4:10

Good question. Um, so I'm, I work for a small public accounting firm here in Baton Rouge, Faulk & Winkler. Um, I'm going on probably year 20 in the space. 16 of that I was a partner at a local, at a large, uh, regional CPA firm doing business valuations and sell-side M&A advisory. Not a broker, but we would do the diligence, quality of earnings valuations, like all the grunt work, um, that's not the, the sexy aspect of doing it, but it's the, the lifting and the requirement, the effort that has to get done. So I did that for 16 years, found an opportunity. Our firm at the time was going through a private equity transaction, and it just so happened that I had an opportunity to go work for a family office. So I was able to go work for one client there and saw a lot of, like, how we take portfolio companies and not just transact with them from a compliance, your tax return, or a valuation for a buyout or a dispute or what have you. It was, here's where the company's at and here's where we wanna get it to. We're paid a monthly management fee. Help them in whatever way you can. And so when I had the opportunity to go back to a smaller local firm that had no advisory practice and said, "Hey, you go grow your own business in this firm," that's the model that I wanna try, is more we're just here to help. We're not here to do single engagements over and over. We're here to build relationships and, and help them through this journey, which can take five, six, seven plus years.

Joshua Wilson: 5:40

For sure. Now, that, that taps into the business model of CPA-ing, if that's a word, right? So the traditional business model of a CPA is what? Bill by the hour. Bill by the hour. And, you know, some of the conversations and, you know, input that we had prior to this is the, the different business models, and one that you just kind of brought to the surface there is a different business model that, that you have brought to this local firm. Walk us through the old model. I call it the old. It's legacy model. Yeah. I mean, it's been around since the beginning of… I mean, cavemans did the billable hour, right? Like, I, like, that is… it's fable. Yeah.

Ben Vance: 6:18

That, it, put their time on the, like, chisel it on the wall. Yeah.

Joshua Wilson: 6:22

Yeah. I mean, Fred Flintstone- Yeah … he clocked in, clocked out, and slid down the dinosaur. Yeah. Right? But when it comes to… And I'm not saying it's bad, I'm just saying that there's, there's other ways, and that's what we wanna, uh, unpack here. Kinda walk us through is what that, you know, the, maybe the legacy model, and then how you saw a different model and how you're bringing that to your local-

Ben Vance: 6:43

Yeah, sure. And it, and yeah, I'll also caveat by this isn't a, uh, unique concept that we are the only ones bringing it there, but I think executing it is… It, it does take some, uh, a, a, a different way of thinking. So I think we are closer down the path of executing it than most. So the traditional is just as simple as however much time it takes us, I've got time, times rate, here's your invoice. And what we find in scenarios like that is there are often times where through 20-plus years of experience, we may be able to solve a problem in an hour that saves you a million dollars. Well, that's worth a whole lot more than whatever my hour, one hourly rate is. That's the… There's some, whatever, adage or whatnot of the plumber that solves the problem, and he charges them 10 grand just 'cause he knew the exact, you know- What

Joshua Wilson: 7:29

screw to turn, yeah.

Ben Vance: 7:30

Yeah. So it's that adage of, if I do that, I'm limiting myself by just that one hour. But on the flip side, I can work for 100 hours and not do anything, like not provide any value, just didn't work. And so you constantly are in this scenario where I either, I either did very little and provided a lot of value and I've cut myself short, or I did a lot and I didn't provide value and we're negotiating over an invoice. And it… You do that wash, rinse, and repeat to where you just get burnt out and you're just chasing client after client after client. And then the only way to really grow that is you gotta hire more people, which requires, um, increasing your bill rates and, you know, just going up on fees, et cetera. And so I find that the clients themselves in that scenario wind up getting more expensive work and oftentimes less responsive. And you can have the smartest person in the world, but in order for them to grow, they've gotta do more and more and more and more work. So if, again, I can be an expert, but if I've gotta do 20 things at once, it's very hard for me to deliver the same amount of work across that, you know, 20 different clients. So what we're trying to do is fewer clients that we can get involved with much earlier, have a flat fee for base level things that we do, which is assisting in, let's just call it monthly closeout or some, some regular recurring accounting work. But knowing that they're either growth or exit-minded, I know there's gonna be things that come up that we need to be sitting ready for.

Joshua Wilson: 8:56

Yeah. And I think that's the difference between rear view mirror and windshield, right? So rear view mirror, here's your financials, here's what you did last, right? The windshield model is, hey, this is where, you know, like you stepped in that family office and, you know, like you're like, "Oh, cool, send me your financials." And they're like, "Uh, here's where we're heading." You're like, "Okay." It, it's a different way of looking. So you're looking ahead and saying,"This is, this is where we wanna go. Help us get there." Mm-hmm. Right? CPA is traditionally a review mirror thinking. Talk to us about that change of mindset and how did you start to, like, learn through that?

Ben Vance: 9:31

Well, I think it definitely allow… It kind of lets you to… allows you to figure out what the client's, I'll just call it north star for lack of a better word. Yeah. Like, where are they going? And so we know is it an exit? Is it transition to my, you know, siblings, my child, whoever it may be? We… Do they plan on selling those strategic, whatever. We, we know where it is that they want to go, and then everything else is geared around how do we help them get there, right? And, and I'm sure we'll unpack a few things, but knowing, for example, if they want to exit and we know today that they need to get $20 million but their company's only worth 10, well, we know, say in that scenario, we're playing offense with them. We're being aggressive. We're trying to look for ways to grow organically, bring on people, make acquisitions. But if they say, "I want to exit 20 million, my company's worth 20 million, I want to exit in five years," we're playing defense, and we're making sure we protect value in that regard. We're not, you know, we're not, um, anti-growth in that regard, but our mindset is just different. Mm. So it just helps know what is their ultimate, ultimate exit and what their timeline is, and allows us to pivot better with them.

Joshua Wilson: 10:44

Yeah. So sitting across from you, we have Scott with FA Mergers. They sell middle market businesses. How do you all play, you know, in, in partnership with groups like this?

Ben Vance: 10:54

Um, great question. So folks like Scott, we would introduce as early as possible, but Scott doesn't want us to say, "Man, I got this great client that in seven years they're gonna need to talk to you." 24 years from now. Yeah, so… And then I'll call you every year just follow up. But we try to get relationships with people like Scott, so we know we have a, a network of maybe 10 brokers that in this scenario, whether it's regional or industry or size or personality, we're working with clients for five plus years, and when they get to be two years out, we're making those introductions to them.

Joshua Wilson: 11:30

Yeah. Super cool. So Scott, with that, what question do you have?

Scott Shea: 11:34

So I love CPAs, first of all, because they're very organized. So I have a long, like, list of topics that Ben brought us, which is great. Yeah. Thank you. Yeah. Sure. Uh, we have some guys that just roll in out the truck and we wing it. Um, so first, so you went from public accounting to private equity family office world and back.

Ben Vance: 11:55

Yeah.

Scott Shea: 11:55

What did you learn during that hiatus, um, that you've applied in the second go round at public accounting?

Ben Vance: 12:03

Yeah, so good question. Um, I probably saw a lot in the three years in the family o- I probably s- I feel like I saw 10 years worth of problems. And, and with that regard, it's, it's mostly like when you open yourself up to not worrying about Every problem needs to be scoped in an engagement letter and a deliverable and an invoice. It was more, uh, like when you're not worried about that, you're opening yourself up to a lot more problems that you can help these clients through. Some of them you don't have to solve. Like, some of the value that we provide is just let me make a connection 'cause this person, if it's a… We're trying to grow organically and, and get our word out, it might be like a ThreeSixtyEight that we need to connect them to. So that was eye-opening of just you don't have to solve everything, and you can go bring in people that are smarter than you, which there are a ton of them, that we can get to partner with, um, is probably one of the, one of the bigger things that we've learned. And then again, the, I don't wanna say the fee model, but it was just help first, and then we'll figure out how to make everything else work is another adage.

Scott Shea: 13:07

So you mentioned on, on one of these topics, um, organized planning versus controlled chaos. Hmm. Walk me through that from your lens, 'cause it's a, that's a huge difference- Yeah … as far as running a sales process.

Ben Vance: 13:21

So let's go first controlled chaos I own a business, I need to retire. I wait for two years, one to two years out to say, "Okay, I'm ready to sell." Well, I haven't had an audit. I don't really know what my company's worth. My stuff's not in a shoebox, but it's in an accounting system, but it's not organized. I've got revenue, and I've got a bunch of GL accounts, and there's a lot of things that are ran through that business. And at the ninth hour, we're working with somebody like Scott. We're trying to unpack a lot of that and carve out this and restate this. So we're dealing with accounting restatements. We're dealing with, um, negotiations, buyers, management meetings, all of that at the ninth hour. And even with all that work, like deals don't go through. Most of them will not go through. So we're doing all of that work. We're charging all these fees. We're billing by the hour, and none of this may be for anything. Mm-hmm. That's somewhat controlled chaos. The organized planning is sort of the pivot of what if seven years earlier we did all the same things, but we just did it where we don't have the… You know, the shot clock's already started, like we're in the first quarter early on, and there's just a lot more calming things that we can do over time. And maybe just coincidentally, we're in kind of the age of AI that we can rapidly get up to speed, kind of create this organization where if we need to update X, Y, and Z, it's already… It's kind of already done. So back on the controlled chaos, at the end of the day and you're selling a business, you need an audit, you need a valuation, you need maybe a quality of earnings deal. Um, you need diligence that's going to be done. You need legal advice. You got insurance. You got taxes. You got all these things that you're trying to cram in. You have broker fees, et cetera, that can easily cost six to seven figures. And like I said, all… It could all be for nothing because it may not go through. Right. So if we're able to, on whatever, seven years or five years before, do evaluation, do a Q of E where we don't have that pressing need Plus you layer on the AI infrastructure where it can be updated real time, um, or close to real time. It allows us to take our clients and, like, get them off their heels, and they can focus on their day-to-day business, and we're just positioning ourselves to be able to respond timely when they need us.

Scott Shea: 15:41

Yeah. And you, you mentioned something else, which I think is the controlled chaos piece, but trying to manage that chaos during a sales process, most deals aren't gonna close. Yeah. So I think that's incredible advice that, like, definitely have your financials in order before you try to get a deal closed.

Ben Vance: 16:00

And I think, like y'all, we work with a lot of lower middle market deals, mid to lower or small, depend- I don't know what your size range and how everybody defines that differently. Yeah. But they usually don't have the corporate accounting team. They have a, maybe a CFO with not a lot of depth underneath or a controller with not a lot of coverage over the top. So in a lot of instances, the business owner may not want their team to know that there's a potential transaction going on. Right. So where we can find ourselves kind of anchored in on some sort of recurring monthly, quarterly exercise, the owner can have us pivot and work on a transaction while we're still involved with the company, and it's kinda going on in parallel. Um, and we can maintain some of that confidentiality until it's time to, you know, let a few other people under the tent and kinda know what's going on.

Scott Shea: 16:54

Yeah. Time kills all deals. It's a- Yeah … super cliche, but momentum is everything.

Joshua Wilson: 16:59

Mm-hmm. Jeremy, when it comes to, uh, being a small business owner, being on the creative side, and then seeing the, the work that, you know, a CPA and work they do, uh, what questions do you have for, uh, for Ben?

Jeremy Beyt: 17:17

A lot. Um, I've, I've got one that's bouncing around my head. Um, someone told me, uh, a great business is a collection of systems run by good people. When you think about building a company to sell in a transaction, do you think the buyer is buying systems or people? Or what is the r- what is the balance of the two?

Ben Vance: 17:43

Whew. Um, I would say the buyer, and you guys correct me if I'm wrong, the buyer is buying cash that's co- that's being generated, and it depends on the business. If that business is heavily ran by people… I've seen great businesses with terrible systems and great people. Well, that's what they're… They're buying the cash that those people are generating, so they wanna make sure they're securing those people. So if we were engaged with that company, we would wanna make sure you've got good contracts and stickiness and incentive programs, not just good base comp. Mm-hmm. But let's, let's build a creative incentive package to make sure not only we keep those people, but, uh, attract new people under that model. Flip side is we just exited a company that d- does have great people, but they were a machine on processes, and for them to scale at the pace they scaled, everything was r- You walked into any room and they had Smartsheets with systems, and they knew it was a machine on… It… This supply chain needs to be in this room for four hours and 20 minutes. Mm-hmm. And if it takes longer than that, there's a red light that goes off and we need to figure out why. So in that, in that model, that's what drove value to them, but I've seen the opposite, where it's all in the, the people side.

Scott Shea: 18:55

Yeah, I think that's- I would argue that you don't generate cash, which is what buyers definitely agree with Ben. Buyers are buying cash, most buyers. I don't think you can generate cash without good people and good systems. So I don't know if buyers like inherently I think they value both of those 'Cause you have to have those in, in my opinion.

Jeremy Beyt: 19:18

Yeah. Yeah. It's, it's interesting. I've, I've always wondered about how much of it is empirical, like, s- data, and how much of it is perceived value.'Cause, uh, in our industry, the creative industry, you'll get companies that get famous, you know, just on a piece of work, and they'll sell for multiples. And I'm like, I know they don't have systems. Like, it just- Yeah … it's a rocket ship. But I guess they're capitalizing on the, the value of the exposure. Yeah. Yeah. I think

Scott Shea: 19:46

there's exceptions too, like you've seen it with AI. They… I forget the term they use, but where they're essentially buying talent- Yeah … and AI engineers. They're paying ridiculous multiples- Yeah for the company, but they- That's just to build … a lot of the times they close the company down. Right. They just want the people. They're, it's like a acqui-hire kind of thing. Um, that's the term. Yeah. Yeah. But that's the exception. The norm is, like, what are your earnings- Okay … and what's my return gonna be? Okay.

Ben Vance: 20:07

And so I wanna unpack that a little bit more, is often those kind of big transaction events are what makes the headlines, and we see a lot of clients that think- … "My company's gotta be worth 10X because I read a book-" Yeah"… and I have somebody that I know." That, that's… And so what we try to say is,"Let's get you prepared, because you might have a 10-year horizon, and then three years from now there's some wave or there's some fund that's trying to grow in this region, in this market, and they're willing to pay a substantial premium if you're ready and you time it right." So sometimes you just luckily run into that. Um, but oftentimes we sort of ground our clients with the reality of this is what, this is what it is. And coming back to the systems or processes, if you wait till two years out, it's very difficult to say, "All right. Let's take a company with no systems to all of a sudden just go crazy and impl- like systemi- systemize everything." Right. But if we're year one of a seven-year process, which we may touch on this m- more later, but we can identify that this client, we may value them and tell them, "You're riskier than most because you have no systems." So over the course of seven years, maybe in the first year, we're gonna try to get them to where certain aspects of their businesses are implementing systems. So we can give them two to three big things a year for them to focus on that's gonna help drive value.

Joshua Wilson: 21:28

Okay.

Scott Shea: 21:29

And there are buyers who I think place value on themselves if companies they're buying don't have systems, 'cause they see it as an opportunity to, you know, instantly enhance that business. Mm-hmm. Again, probably not the norm, but, um, my opinion too. So we- I'll, I'll stay there … yeah, we've got, um,

Ben Vance: 21:49

we've got a group that just that. They're more of a when they buy a group, buy into a company, they act as the operator. They'll buy a founder out, and they'll put teams in, and they, they operate the business. 12 months ago, their strategy was find founders that have inadequate systems- Mm-hmm … that we can come in and untap that value and create it. So they're kinda looking for good people, bad systems. We can come in- Yeah … and change the game. Had meeting with them a couple months ago, and they said with AI and what they're able to do, now they're looking at well-run comp- good systems but aren't using AI. So they can take great companies and make them better and good companies and make them great. Hmm. So it's, it's opened up a lot of opportunities I think for, uh, the right types of buyers. Y-

Joshua Wilson: 22:34

you're looking at me, Scott. What do you have in mind? Do you have a question?

Scott Shea: 22:37

No, I was just looking at you. Oh, thanks, man. I can ask more questions though if you need me to. No, I got it, buddy. Okay.

Joshua Wilson: 22:43

So, um, part of the business model of, you know, private equity, fundraise, acquire the deal, they do their value add, their value proposition, right? So they might Add systems. They might integrate AI, right? They operate, optimize, and then return capital to the, the, uh, the groups, right? And then repeat. Right. Rinse and repeat. In that, you mentioned two forms of value add, right? You maybe add systems, processes, uh, technology, AI. This is a question from Kelly. So one of our great joys is handing off a, a question from one guest to the other, but I'm tying it into my question. You know, what, what AI is… you know, currently doesn't exist that you see being most beneficial for your business long term? You talked about, uh, layering in an AI over their financials that could kind of operate in real time. What is… How has that changed the game as a CPA for you?

Ben Vance: 23:42

Yeah. So a- admittedly, we're, we're sort of, I think, with everybody, um, building this plane mid-flight- Yeah'cause it changes. Like, so I started the middle of last year, and for the first three months, we were looking at all sorts of apps, that this one would help clean financial data, this one will help with report writing, this one would help with forecasting, this one will help with management note-taking and stuff like that. Right. Three months later, we go with, uh, Microsoft Co-Pilot, that environment or the platform if you're building agents, et cetera, like you're teaching it, you don't need the apps. This will do it. And now Claude has came around. That I know has been around for longer, but still pretty new and gaining a lot of speed. So for us, it's more than just the financial piece. And, and I could… We could probably talk for hours on this, but I'll s- this is the eighth one, so I'll, I'll, I'll spare you guys a little bit. But it's more than just helping us clean up the accounting and do some of the financials. It's we create the valuation, we create the Q of E model. We're organizing a data room that has all the files that a buyer would potentially want. And so it's, it's constructed in a way that when we layer a Claude agent over it, and we have a client that's trying to get an increase on their line of credit, and it's kind of like, "Hey, Claude, go build a bank package that helps support X, Y, and Z. Hey, Claude, we're looking to acquire a business, and here's our financials. Here are the synergies that we see, and here's the acquiring company we want to acquire as financials. Build a future model that, you know, incorporates these synergies and maybe tell me what I don't see. How should I approach this from a negotiating standpoint?" Not just to ask it, close our eyes and go to market, but it's allowing us to take what would take us months to do- Yeah … that if we can get our clients under our tent and organize their data that way, where we can appropriately and efficiently tell the agents what to do, it frees up a lot of time

Joshua Wilson: 25:46

Ben, what is a, um, in the CPAing world, why did you become a CPA and what's your favorite part of the job?

Ben Vance: 25:55

All right. So truthfully, I became a CPA because I started in real estate in '06.

Joshua Wilson: 26:00

Bad timing.

Ben Vance: 26:03

And I needed a job. So, um, I was smart enough and the firm I was at was a CPA firm. Yeah. Uh, so, um, became a CPA just kind of by default, like I'm a finance guy, but h- became a CPA. Um, two months in, I did a business valuation. I'm like, "This is cool. I like this a lot better than preparing a tax return." Yeah. And it's really just stuck. And I also like Baton Rouge, and so I've never really ventured out to try to conquer, you know, Houston or Atlanta, and it just… I liked what I was doing. I liked the people that I was with. I liked interacting with clients. Um, I liked the society of CPAs and just networking, and it's a respected profession. So that's really what drove me there is kind of by, I don't know, by accident or by, um, just needed to grab a branch when the housing market was falling.

Joshua Wilson: 26:52

Man, so when that crashed, I was in real estate too, spec building, you know, built $8 million worth of spec homes in '06 and '07, and, uh, that's when I became a firefighter. So- Yeah.… you know, when, when, when, when, uh, industries collapse, you, you reach out for branches and you figure stuff out real quick. Um, in the, uh, in the world that you are, like, where do you think it is heading? So at first, you know, the, the students right now studying to become, you know, finance or CPA, and they're looking at AI, we're, we're talking about AI, and they're going, "Holy moly, do I have a job in the future? What does this look like?" What… Give some hope to them. Yeah. Maybe some warnings, but maybe some hope for the future students. Yeah.

Ben Vance: 27:35

Uh, both sides. I think they should be worried- … 'cause these things are very powerful and very good. Um, in every application that I've seen, AI has gotten things wrong. So it's… Now, I'm sure it'll get better and just give it time and it'll start… I think if you, if you tell it it made a mistake, you don't have to tell it again. It won't make that mistake again, but it's still making mistakes, so you have to have subject matter expertise. Um, where I think it really… I mean, I think clients are the ones that are gonna benefit the most from this because it's just gonna free up a lot of, uh, whatever time and cost it takes to deliver a lot of these things. But for CPAs or just business-minded people in general, advisors that truly understand the business and they can start asking the why question, we've got staff that I was working with earlier of it's more than just hurry up, prepare this, give it to the client 'cause it's what they asked for. You can drive a lot of dialogue and try to understand why are we doing this? How are we… How do you plan on implementing this? And whether you're learning how to prompt the AI agents better or you're now, um, just interacting more with the client to help them use that data, I think it's freeing up. It's gonna take a lot of, let's say, more Stereotypical CPAs that might be more, uh, introverted and shift it to more client-facing, how can I help you do it? Um, but I think there's also power in if you are introverted, like learn AI and how to work with it, there's a lot of power there. So it'll be f- need fewer people, but I think you can be a lot more impactful.

Scott Shea: 29:08

So you mentioned AI occasionally gets things wrong. Um, what do most of your clients that you work with get wrong? Or what do you find most often in like quality of earnings audits that are wrong?

Joshua Wilson: 29:23

And also intentionally like trying to push through earnings, you know, where Q of E pops up and you're like, "Eh, you know, let's look at that."

Ben Vance: 29:31

Yeah. Um, I mean, look, most clients do try to… Not most. I'd say there are a number of clients that do manage their business to minimize taxes. Yep. I don't think that that's wrong. I think that it's good for tax planning, but it's bad for selling a business. Couldn't

Scott Shea: 29:48

agree

Ben Vance: 29:48

more. So that's an area where, again, where the early Q of E, most of them don't even realize how much they're pulling out. They know what their salary is, they know they get a distribution, and they know their LSU tickets are paid for. But they don't realize the car, the travel, this, and y- you look up and you might be seven,$800, a million dollars in. That also helps us talk to their financial advisor to say, "Hey, when we sell this business, this is the income we're really trying to replace,"'cause they don't have a good grasp of what, you know, what all that is. Right. Between leases that they have to real estate and above or below market, and once you chew all that up and you realize how much it is, it, it allows us to kind of level set what expectations are. And if we do it early enough to say that you realize the RV and the travel, none of this is driving value in the business. And if they're okay with that, that's fine. But showing them where if we wanna generate a, whatever, 20, 25% return, like and we were to go invest in systems or people, to the question earlier, instead of all this excess spending, like, and if our goal is to sell the business, if we sacrifice three years of living super, super high on the hog, I think it's worth it 'cause it'll give you a better result. I think… Hold on

Joshua Wilson: 31:06

Rock, paper, scissors shot. You go. Okay, okay, I got it. All right, so we were, uh, just having a debate of who gets to ask you the follow-up question, 'cause I think what we're talking about is, is so important, especially when you're having a vantage view of I'm building this business, right? So as a operator, especially if, man, you're working hard and you're trying to make every dollar count, you're, you're thinking through the lens of tax savings, right? Tax planning, tax savings and stuff. If you're looking at the next handoff, right, the baton handing off, that's a different form of value that you're building for. You're no longer building on, oh, how do we save money taxes, but how do we build this to have the biggest multiple? Yeah. Right? So you're trying to save dollars, but you're, you might be missing out on multiples of EBITDA or whatever. Talk to us about when- If you make that shift, when is that appropriate to start thinking about, "Okay, it might cost me a little bit more now, but I need to start thinking about a multiple of EBITDA"?

Ben Vance: 31:59

Yeah, I think e- earlier the better, and that's not just a lazy answer because there's often… There might be 20-plus things that you need to do to drive that multiple higher, and if you try to do it in one to two years, it's… I mean, it's just impossible to, to execute. So if we can… You know, here we are, CPAs, we'll make a list for you, like, 'cause we're good at making lists . We're great at making lists. And then we can prioritize that, and sometimes it's what we think is most important, but also what the market may… You may have a key employee that has an opportunity to leave. All of a sudden that goes up the list, and how do we take advantage of that to try to give them more responsibility or, um, you know, carve a incentive program around retaining them which might catapult into how do we cascade this across the entire organization and check that box? Um, so long-winded answer of, of you can't start early enough. If we can try to do, um… I'll, I'll throw a, a book out there that I'm sure everybody's read Stephen Covey's Seven Habits, right? So I use that quadrant approach a lot, where things that are urgent and important are usually what most business owners are focused on every single day, but there's that urgent and not important,'cause it's not important right now'cause I'm not trying to sell my business. Right. We try to see how many things can we fit in that quadrant, and then one to two to three of those a year we try to get done. That's systems, it's people, it's customer diversification. It's all the things that when we do evaluation, and again, not to bore you guys, but we have a certain part in the value where we're trying to assess risk, so we can assign a, a multiple to that business. The riskier it is, the lower the multiple or the higher the discount rate. So through that conversation, we're saying, "We dinged you for more risk because you do everything. You've got one big customer with no contract. You've got two vendors, one of them's related to you." Like, those things that we say. So over time, let's try to get better at that, and let's do one thing at a time and not try to do 10 at once. Yeah. Scott.

Scott Shea: 33:59

I get our potential clients come to us a lot wanting to sell when the business has started to decline. Um, when clients ask you regarding, like, timing, what is your opinion on what's the best time to sell?

Ben Vance: 34:13

Not when it's declining. Um- Clearly. Yeah, not when it's declining. Um, you know, and it A buyer's gotta see a path to double or triple. Like, they've gotta see that, so they wanna see momentum. So, uh, an example, the client we talked about earlier, they were about to just go to the moon. I mean, they were going from doing 3 million in EBITDA to 15 to, to 50. Like- Wow… not, not even exagger- Like, from 5 million to 50 million. Very, very much an exception. Right. But we were in a position to say, "We might not have to sell this thing. Like, we can hold onto this and do very, very well." But there is risk. We talk about these, uh, once in a lifetime events that happen every two to three years. Regulation, government, hurricanes, tariffs, pandemics. You don't know what's coming around the corner. Mm-hmm. So I would suggest when you see that momentum, it's a great time. And private equity's not for everybody, and it's one of the reasons I got out of a brief stint in, um, family office and out of public accounting. But for a closely held business, seeing that momentum is a great opportunity to take chips off the table. Yeah.'Cause a lot of times that growth is gonna require debt or investment. We talked earlier about offense or defense. Mm. Like, do you really need to play? Do you really need to throw for it? You know, whatever. First and 10 and you're going for the home run or whatever. You know, may- That's… I think that's two sports analogies in one that are inaccurate. But- … point being is- It's baseball … it may be a great time to, to de-risk and take chips off the table- Yeah … before you take that really next-

Joshua Wilson: 35:50

Well, I think if you ask any entrepreneur, you know, you ask Warren Buffett, "How much do you need to make?" And he goes, "One more dollar." So I think a lot of times the, the founder has in their head, "Oh, I could hold onto it and I could increase the value a little bit more," and boom, boom, boom. And they, you know, they're starting to lose steam. They're s- they're holding on to things. They're delaying decisions, and you start to see a decline. And then on the decline, that's when, as the numbers decline, as the energy declines, but also the multiples, right? Yeah. Yep. Um, so for tho- those people out there, you know, like, what do you see has worked well and where do you, where do you have some warning signs?'Cause you've seen a lot of these scenarios.

Ben Vance: 36:29

Um, I think understanding truly What a realistic value is and, and sort of anchoring on reality is one, right? If it's level or if it's declining, you are where you are. You are where your feet are. And if you're trying to sell today, surely if we can plan, and today might not be the best time and we can wait, fine. But oftentimes there's a health issue, there could be a divorce, there could be a lot of other factors that are triggering,"I have to sell at the wrong time." Mm. So just knowing where that reality is. We had a, um, we had a client that's on the acquisition side that we had a very good target that we were excited about. This could be a really big thing, front page news, like we were really excited pushing this. The target had EBITDA that had declined for three straight years. We were still… And of course, the next year was gonna be their best year ever- … like always. Um- Yeah … which is that, that next… It's that mindset of like- I can do it again it's coming, like we- I can do it again … it's gonna turn around, and it very well might. It's like Rocky number seven, right? Like, I, I could get back in the ring. Yeah. No

Scott Shea: 37:31

projection has ever gone down.

Ben Vance: 37:33

No. Yeah, yeah, exactly. But so we, we presented this client with a very strong offer, and they declined it, and there were all these reasons why, "Man, 10 years ago we were doing this, and we've got ex- There's all this value that you guys are missing." And like, we're accountants and I'm… But your cash flow says something different. And so ultimately, maybe right decision for both parties that we weren't gonna pay more than we thought we were already overpaying, but we weren't gonna pay them that. And the seller believed very intimately that they can do more on their own, which is fine. But if that were my client, I, I f- I don't lose sleep over this, but I do think about it from time to time, is that might've been the best offer they're ever gonna get. Yeah. And they walked away from it. They need to be comfortable with that. But we weren't on th- We weren't advising them in that scenario.

Scott Shea: 38:22

I think that's a common situation too, the, the emotions and sellers value, like the sweat equity and the, you know, "I bought $5 million worth of assets over the past 20 years," and-

Ben Vance: 38:34

Yeah

Scott Shea: 38:36

don't like the fact a lot of times that earnings are what it's truly valued at. Yeah. They want those intangibles and those emotional ties to, to be valued. Do you see that- Mm-hmm … more often than not?

Ben Vance: 38:46

Oh, 100% more often. We see, you know, the, the adage of you've got one big customer and it, it's never… I've had it for 20 years, and it's never going away, and it goes away. Right. And it has a huge impact, and I've seen that more often than not. Especially

Jeremy Beyt: 39:00

after an acquisition or something, you know, you're-

Ben Vance: 39:02

Yeah. Yeah. It can go away, so just, you know, those things that the business owner just thinks will never happen always does seem to, um… There's just, it's never a dull moment when you own a business, for sure.

Joshua Wilson: 39:14

Yeah. Speaking of never dull moments, on this podcast, uh, especially in Baton Rouge, this is a Baton Rouge, uh, tradition here, is, uh- Yeah. we do we just… I pulled this out of my hat just a few minutes ago. Is, uh, we do, uh, round table rapid fire questions. So I get to start it out. Poi- I point to someone, and you could ask anybody at the table a question, and then, uh, we'll go from there. So Jeremy, you get to ask anybody at the table a question. Go for it. Oh, gosh. I don't know why

Scott Shea: 39:43

he likes doing this. All right,

Jeremy Beyt: 39:44

Ben. Yeah. Yeah. Ooh. Uh- Any question. Doesn't even have to be business … I'm around the table with finance bros. I'm not a finance bro, so I'm gonna ask you, but this is sort of like an open question. The narrative around PE in general is that it's a, it's a company killer. It's not good, is like the narrative outside of the financial world. Um, what is a success story, a PE success story that everyone would know about? Like, a public one.

Ben Vance: 40:12

Hmm, I, I don't- I may come back to the public one because I don't wanna… I'm careful about- Oh, yeah. Okay, okay … you know, about saying, "Oh, man, this worked great for, for this company." But I have seen it work really well in instances where we're taking chips off the table and the founder is sticking around to help grow, and it works with his or her timeline. And in situations like that, the owner might sell 80% of the business, and let's just make up a number and get $20 million. And then when they go exit that 20%, they might get more than they got on the first. So from an owner side, very successful. Um, it does raise the question, well, what about the employees? What about the experiences? And, you know, I've seen good private equity and I've seen bad, so that kinda depends on make- making sure from the owner standpoint, are you in it to maximize your paycheck? But I have seen some owners look at three offers from three different private equity groups and pick the lowest one because of what they were gonna do for, um, for the company- The company, yeah and the people. There was this… It wasn't a story, but, um, Fiber Bond is the company in North Louisiana that sold some massive number and basically bonused out a ton of money to all of their employees. I've seen that happen multiple times of ways that, like… I feel like the big exit to private, you, you're going to likely get the bigger number going that route, but it does come with a cost. And owners that I think are able to align all their employees with and then cut them a piece of the action is, are ways where- Mm-hmm … you can get some energy. But it does ha- You kinda detach a little bit from what got you there. But there are- Mm-hmm … certain businesses and, that have evolved that, that require that. So, um, I've been anti-PE in certain aspects. I've been a super advocate for it in others. So really just very, very, um, whatever, cliche answer, but it kinda depends. Yeah.

Joshua Wilson: 42:10

Yeah. I, I think that's great. All right, Ben. It's your turn, man. You get to ask a question to anybody at the table. Man. Uh- You're the host now.

Ben Vance: 42:18

Uh, let's go… I'll go Scott. Uh, maybe give me the… We'll go maybe… Let's go best case. I was gonna say horror story or, like, most success story. If you've helped busi- multiple businesses exit, what's been the most rewarding experiences you've had?

Scott Shea: 42:35

That's an easy one actually,'cause we talk about that a lot. How do we value success as a business? Obviously, collecting fees is important, right? But a year or two years after a transaction's complete, if I can go to our client and say, "Hey, do you have any regrets?" And the answer is no, then that's a win. Um, which kind of piggybacks on Jeremy's question. Like- Yeah that's definitely the stereotype, I think, that PE goes in and destroys companies. Um- Probably the minority, though. Most PE groups are designed to generate returns for investors. You can't do that if you go into a good company and disrupt it. Um, so I think that happens and you hear about them, but I don't think you hear about all the good ones. Um- Yeah … 'cause PE groups that do that aren't gonna last long. Um, they've gotta generate positive returns, which comes from buying and treating people right post-acquisition.

Joshua Wilson: 43:32

Yeah. And we just interviewed a PE group recently, can't share the name, like, specifically, but if you listen through, and one of their biggest core values is they love to find good people, and how do we treat these people well, and how do we, how do we expand on the culture and the nature of that? So I think there's good, there's good and bad of everything. But man, I, I, I, I know that that sentiment is, is there and it's real because those are the stories that h- books are written about, you know, Enemy At The Gates- Right … and all that, or there's a, a PE book I for- I, I got, Barbarians At The Gate. Yeah. Right? And it talks about leverage buyouts and how, when that was hot and real- Mm-hmm … and stuff like that. So yeah, there, there are stories that, though, and tho- those get a lot of the publicity. But listen to some of the- It's the marketing

Scott Shea: 44:16

guys' fault.

Joshua Wilson: 44:17

Yeah,

Jeremy Beyt: 44:17

I wanna hear the good stories. It's like the- 'Cause I hear- It's like the news, right? You never

Scott Shea: 44:20

hear about, like, anything good. Right. It's like the wrecks and the collisions, and- And then- … people are drawn to the- Yeah, chaos … the chaos. The premise

Jeremy Beyt: 44:27

that, like, returns are the, the best outcome for a business is also, like, debatable, you know? Like, what is the fu- what is the purpose of a business? To provide- Mm … goods and services. To what end? You know, is profitability the ultimate end? In this sy- in this system, yes. But in humanity, like, it's a bigger question Great piece. That is a great question. Uh, and, and that is maybe the root of the dis- the dissonance there is like, well, yeah, if, if maximizing financial outcomes is the goal, then yes, good. But if maximizing human quality of life is the goal, maybe not.

Ben Vance: 45:03

Well, so and I'll bring… We can dovetail around a lot of these things is if that's what the owner truly values, there are op- opportunities to do like an ESOP or something where you're selling- Right, right … it to employees or, or as you're interviewing, you may go with a PE or a, a plug, a family office, not just a, but family office capital in general that may not have a certain five-year exit timeline. Mm-hmm. And you've got… They're not using other people's money, they're using their money, and they may have already had their liquidity event, and they're giving you a little bit of growth capital and bringing that expertise, and they're not telling you you've got to exit in five years. Mm-hmm. So there's a… Again, when we talk early and often with clients, we can help understand what is… what do you really value? What are you really trying to get? Yeah. If we're sprinting for the top dollar, like we're gonna maximize that and, and get people in front of you at the right time when you've got the right momentum and time it. If we value other things, our conversation's totally different.

Joshua Wilson: 45:59

Yeah. Cool. Yeah. So Scott, it's your turn, man.

Scott Shea: 46:03

All right, so this one's going to Ben because I was gonna ask it anyway. So I'm gonna read like six things that I've noted during this conversation and through his, uh, beautiful notes that you shared before. Yeah. All right. Offense versus defense. Sitting on a fastball, but can you hit the curveball? Coverage over the top, which that's a football term in my mind

Ben Vance: 46:24

Okay. I don't know if I said that- You said that … we'll, we'll take it. Yeah. We- You talked about a CFO We were talking the CFO- Yeah … has

Scott Shea: 46:28

coverage of, uh- And then the controller that has… Or the CFO has no depth underneath.

Ben Vance: 46:33

Okay.

Scott Shea: 46:33

Football, at least. There's a Pedro Martinez reference here.

Ben Vance: 46:37

Yeah.

Scott Shea: 46:38

And you mentioned home run. Whew. So, like, you love sports- Yeah … clearly. I hope. Yeah. I love sports. So, like, I don't know what the question even is, but, like, what do you learn from sports? What is this all… Like, why did you reference it so much? Yeah, yeah. That's the question. So,

Ben Vance: 46:54

so from a very below average athlete, like I probably peaked in- Second grade … sophomore year high… It's a little better than that, maybe sophomore year, high school, wherever. But it was definitely, it was definitely early. I peaked early. Um, but I've always loved sports, and I've loved just the lessons it can teach you and all this. So I'll, I'll go… We- we'll go Pedro. Um, so there's a book called Crunch Time. I don't know if any of you guys have read it. It's kind of off the path. Um, it's co-authored by a pitching coach, Rick Peterson, and a business coach, Judd Hoekstra, out of like Ohio. Rick Peterson was Pedro's pitching coach, uh, for the Expos, like in the early '90s when they had this… not a dynasty, but there's a Netflix show on it right now. Just early in Pedro's career, he was a very gifted pitcher, but he could go streaks where people can't touch him, but we're talking like batters and, and innings, and then it would collapse or, or what have you. So there was a… It was a day where there was a double header, I think it was in the mid-ni- n- '95, '96. Double header, second game, pitching coach goes to Pedro and says, "You're the only arm that we've got. So whether we win or lose, I need you to finish the entire game. You've got to throw the whole game." So this might've been three or four years into his career. He tells him to just take it easy, like, "Give me 90% effort, 'cause I need your arm more than I need 20 strikeouts today." Pedro threw nine innings of perfect baseball on that. It'd be a better story if I said he threw a no-hitter, but he actually gave up a hit in the 10th inning and they won one to nothing. Wow. Wow. So the lesson that I take from that, and it's the lesson from the book, is- When you can relax… It's like golf. When you relax, you can hit the ball further. When you relax in a normal setting, you're just more at ease and you can make better decisions. Mm-hmm. So how we can take that into the business community, and as a business owner that faces decisions day in, day… I mean, constantly bullets are flying, and then you layer on top of that, well, now we gotta decide how to exit and all these things and my employees and this- Mm-hmm … and all that. If we can slow it down and allow them to just relax and perform at 90%, we're gonna make better decisions. Mm-hmm. So that's your, I don't know, your curveball, fastball question. Like that's- Yeah, I got, I

Scott Shea: 49:13

got some follow-up rapid fire. Can I do rapid fire, Josh, or just you?

Ben Vance: 49:17

Go for it, man.

Scott Shea: 49:17

Okay. Favorite athlete ever?

Ben Vance: 49:20

Griffey. Which one? Ken. Junior, the Kid. Okay, the- Junior … okay. Yeah.'Cause the dad

Joshua Wilson: 49:24

played too. Yeah, yeah, yeah.

Scott Shea: 49:26

Favorite sport to play?

Ben Vance: 49:28

Now is golf, but I do… Baseball has been my, my, you know, passion, but- Mm.

Scott Shea: 49:34

Favorite sports team?

Ben Vance: 49:36

LSU.

Scott Shea: 49:38

What sports figure inspires you the most?

Ben Vance: 49:43

Oh, it's like the underdog. It's like the gritty player that may not be the most talented that, uh- I

Joshua Wilson: 49:49

love that. Yeah. Rudy.

Ben Vance: 49:50

Rudy. Yeah. Rudy. Oh, I don't… I have to think, like, who's the grittiest kind of, but it's your, uh, more mutual kind of- Like a Rodman kind of guy? Oh, no, that's- that's more of the, uh… I mean, I- I- I imagine… I- I admire, like… So take Rodman, he's a role player, great basketball player. He's gonna go out and get rebounds, and that's- Right … what he perfected. I think in The Last Dance they talked about, whatever, I mean, he was going to do a WWE, um- Right. Yeah. you know, in the middle of the playoffs, but how fanatical he was about rebounding. And there was, I think it was in The Dance, they talked about he would sit… He wouldn't- wouldn't practice even. He would just watch as the other team was warming up, and he would count the rotations on each player's shot. Wow. So he knew long rebound, short rebound based on who was shooting it. So, like, those things fascinate me versus the, uh… I guess since it's pressing and timing right now it's like the, the just hurry up and get fouled type style of it. Right. Right. It's just like, that to me, like you're super athletic, but it's not fun to watch. Agreed. But watching the people that, uh, either hone in to the, their role, um, or they're just really gritty and they, you know, they have a very long career, but they're not the, you know, the best athlete.

Joshua Wilson: 50:59

Yeah. Uh, you brought up something really cool, and I'm gonna, I'm gonna… Uh, no, not you, him. Uh, Ben, our guest. Uh, he- … Scott was like, "I did?" I was excited for a moment. Hey, your rapid fire work was stellar. Just to let you know that the baseball analogies and what you caught, that was really good. You're a great co-host. God, I'm the worst. Thank you. The best, the best co-host named Scott in Baton Rouge I've ever had. Uh, Ben, you- you- you mentioned something about the, the, the guy sitting there watching people shoot, counting the rotations. What I saw when you were describing this is, like, I bet you have something that you pay attention to that nobody else does. If you, if we were to talk to your family or your close friends, like, what do you pay attention to that maybe drives you nuts, or attention to a, a specific detail that you see?

Ben Vance: 51:49

It's, uh, I'm sure my wife would agree with this, it's the what ifs. I mean, I look at a business and a forecast and a spreadsheet 'cause I'm a geek, and I get into what if this, what if this, what if this. So just knowing all of the what ifs is probably to a fault. Um, overanalyzing it, yeah, but, um- I think letting business owners, if they can plan under the worst case conditions- Yeah you know, I think they can, they can position themselves. And, and let's go on that for a second, is I do see a lot of businesses that don't focus on building cash, right? It's distribute or, you know, spend, distribute, what have you. Lately, and even in the family office space, um, and some of the interactions I've had with other, you know, successful businesses is keeping… Like, everyone loves the, the EBITDA sexy part of your financial statements, but understanding the power of dry gunpowder to have on your balance sheet when opportunities come up that you can just act like that are huge. Or it's weathering that, "Hey, I'm in a, I'm in that, uh, I had one bad year, I'm out of cash. I need to bring on an equity partner. I'm s- I'm selling part of it at the wrong time." Yeah. But if you j- you know, hold onto your powder and can weather that storm- Yeah … can really help out.

Joshua Wilson: 53:04

Well, your what ifs and your… I would say that's a superpower because a business owner thinks about that day and night.

Like, I wake up at 4: 53:13

00 in the morning thinking of the what ifs of the world, and fear and insecurity drive me, and the what ifs are always plaguing my brain. So to have someone else thinking about what are the what ifs in my business, so very valuable. Yeah. So, like, your… It might drive some… Like, that, that's a superpower, bro. I think so many business owners

Scott Shea: 53:30

too, we've talked about on other episodes, they get into business- Mm-hmm … oblivious to the risk. So I think it's helpful to have, like, someone, the devil's advocate. Yeah. Like, I don't know if it's intentional or they don't wanna think about it'cause they wanna know it's gonna work, but, like, business is hard, so having people like you that kind of say, "Hey, just FYI, like, maybe this could happen"

Ben Vance: 53:52

Yeah. Now, you're free to make the decision you want- Right … but we're gonna show you, like, the home run and the strikeout. Yeah. Mm-hmm. Which one do you wanna do? Most

Scott Shea: 53:59

business owners see the home run.

Ben Vance: 54:00

Yeah, yeah.

Joshua Wilson: 54:02

Um, one of our… So you're the lucky guy because you're the last one of this trip, of this podcast tour. Guys, did you like this podcast tour? If so, uh, we have a few other conversations going on. One is with, uh, the group out of, uh, New Orleans, and they're the Economic Development Council, and they've got a group of middle market businesses and, and people in that industry. Uh, so I think that's where we may go in the future. But if you're a… Especially if you're in within a, I guess for me, a 10-hour drive, and with Scott, a one-hour drive before you… he gets tired. You know, like, if, if this idea of podcast tour resonates with you, especially if you wanna talk about selling middle market businesses, like, we'd love to have that conversation. Like, thedealpodcast.com's a great place to get that conversation started. But, uh, one of our, uh, great joys is connecting guests from one to the other. And since you're the last, you got two questions. This is from, uh… I'll let Scott do this. This was such a, um, a special interview that we just had.

Scott Shea: 55:03

All right, so this is from, uh, Mr. Lenny Lemoyne. Let's see Can you help me with this first word, please? When. Oh, there you go. It's hard to speak. When you look at the importance of financial performance, what did you s- what do you see as the one thing that will always serve as the KPI for any and all industries' financial success indicator?

Ben Vance: 55:33

Uh, well, so we talked about people today. Um- Mm … and I don't know if this is a layup or, or not, but- Another sports reference There you go. Yeah. They're… I'm, I'm littered with them. Um, I was very good at layups. I could not dunk. Um, like revenue per person- Oh, that's a good one … if that's what we're looking for is, um- That's a great- You know, I think just whatever, in general, like w- the question earlier about systems versus people- Yeah um, I think that's a telling sign. We actually add it to our benchmarks of, uh, you know, how one company's performing to the next. Even looking kind of, like, internally the company over time, how have they performed revenue, um, with the amount of people that they have, so.

Scott Shea: 56:14

That is not what I expected.

Ben Vance: 56:15

What did you expect?

Scott Shea: 56:16

I don't know, like, some boring accounting term. Gross margin or- Yeah … yeah. That's a great answer. Cost of goods sold. That's a great answer. I was gonna ask, is it, like, is it

Jeremy Beyt: 56:25

top line revenue or, like, gross profit per head?'Cause cost of materials- Well, if

Ben Vance: 56:30

you… to, to go into the weeds- Now we're in the weeds maybe gross profit per person might be a better- Yeah, right … you know- Depends on the business too, probably. Yeah. Yeah, yeah. In the food business. I ruined it. Yeah.

Joshua Wilson: 56:39

Yeah. Yeah. Um- That's great. Ben, super glad you're here. Uh, as a podcast enthusiast, as a podcast host yourself, as a, a guy who's been on a bunch of stuff, what's one of your favorite questions to ask your guests?

Ben Vance: 56:53

Oh, man, it's, um… I'm not gonna use a sports reference. Come on. One of them is, is, uh- It's got ones. It's so- Well, it's, it, it's is there a question you thought I was gonna ask that I didn't, or a question that I should- Yeah … have asked that I didn't- Yeah… is one that, um, one it's kind of a make sure I didn't forget something- For sure but that's also one that I make sure if they thought they were gonna have to answer a question, I didn't ask it. It's a way of… I'll… I ask Claude that a lot too of like, "What am I missing? What did I not ask you- Yeah … that I should ask you?" Yeah.

Joshua Wilson: 57:23

So. So I guess, yeah, flip… let's flip that. Like, as you were walking in here today, you got to see some old friends, right? And new friends. I'm the young friend. But as you were, uh, you know, walking in, what, like, what question, I guess, did you want us to ask you?

Ben Vance: 57:41

Oh, cle- yeah, touche on that one. Probably one of these on

Scott Shea: 57:44

this beautiful

Ben Vance: 57:45

list. On that list? No. Actually- No, I think we covered- Actually, yeah, go need to- Yeah Refer to

Scott Shea: 57:48

page

Joshua Wilson: 57:48

four.

Ben Vance: 57:49

I think we covered all the bases on that one. Section three. That was… Yeah. No, that

Joshua Wilson: 57:53

was great. Amendment

Ben Vance: 57:54

27A. Yeah. Um, I think we did a pretty well job, but I'm gonna, I'm gonna try to think of if there anything out there. Um, I don't know. I'm, I'm stumbling on that one. Uh- All right. So-

Joshua Wilson: 58:09

Maybe come- Yeah. Yeah. We'll, we'll come back … I'll think about it. Um, let's do one more shout-out Thank you for ThreeSixtyEight. Thank you, Jeremy. You have, uh, overwhelmed us with your hospitality. I think I ate every single fruit roll-up out of your, uh, snack. So thank you for all those snacks. Uh, Scott, thanks for, uh, you and the team at FA Mergers for, um, investing in the future entrepreneurs and inspiring them to go. Uh, you Chase, you Scott, grateful for you guys. All of our, uh, past guests, we've had a ton. We're so grateful for you to, uh, dedicate your time, energy, effort, and driving in sharing your joys, sharing your successes, sharing tears, and, uh, just sharing a part of your story with this community. Community, as always, reach out to our guests, say thanks you for being on the show. Um, back to you, Ben. You've had some time to think about it. Yeah. Go for it. I think,

Ben Vance: 59:05

um, I think I usually will get asked like, "Hey, if, if there's one message, you know, that you want, you know, to, for listeners to take away, you know, kind of what would that be?" Yeah. Mm-hmm. You know, it's kind of a capstone question, so that would probably be my question. Go for it. Yeah. So, um, preparedness, like be over, over… I'm, I'm gonna bring in another sports analogies- Ooh, yes … 'cause I know Scott's waiting on it. Yes. We'll keep it on baseball. But, um, just being, being over-prepared so that when curve balls come at you, like you're ready for it, right? Mm-hmm. So one of my more favorite stories is like, it's an athlete, a baseball player that nobody… If I said the word Willy Álvarez, nobody in- It's in here. Yeah, yeah. It's there. I didn't say it 'cause I didn't know- Yeah … if he was a baseball

Scott Shea: 59:46

player.

Ben Vance: 59:47

Yeah. You weren't even sure what sport he played. I wasn't. But Willy Álvarez was like a Dominican or Venezuelan, like phenomenal young pitcher. I'm gonna do a very short version of this. At 16 years old, he was striking out 12, 13, for- 15, 16 batters in a row. This, uh, scout finds him, watches him for two weeks, can't believe what he sees, brings in another scout. I think Peterson was one. They… Rick Peterson, so it was in that book. They immediately sign him. I think it was the Rangers. He rapidly goes up the, um- farm system. His first start in a major league, he doesn't last an inning. He gets shelled, like seven runs, maybe one out, and then he gets sent back down to the minors, and he can't… Like, he, he's just not himself. He's not striking out anybody. He's not very good. Rick Peterson coaches him, and he's like, "You gotta tell me about your practice habits. How do you practice and prepare?" He said, "I've never had to. I've always just been the most gifted person, and I could, I could just perform, and I never did that." He said, "Okay. Well, we're gonna teach you how to practice." And he put two stakes in the ground over home plate, and he tied a string, kind of tied with chalk. It was pink. And he would tell him to f- you know, pitch and hit the rope 10, 20 times in a row, and once he could do that, he would tell him, "Close your eyes," kind of a Bull Durham, you know, hit whatever it is. But breathe through your eyelids, I think it is. But close your eyes and hit the rope. And so if you can do that, his whole thing was, like, how much time and effort and preparedness it takes to have the confidence to be able to do that, that when you get into situations where you feel like you can't, like you know you can't, 'cause you can do it with your eyes closed. Mm. So his first major league start, he doesn't give up… He doesn't get out of the first inning. He goes back down to the minor league, spends two years finding himself, learns how to practice. His second start for the Marlins, he throws a no-hitter. So when he first get, when he got back to the major leagues, it's like he's got it. I don't know how long… I think he wound up being a pitching coach. I think he played 12, 15 years, and wound up coaching. But that's something of, like, the power of being over- over-prepared so that you can relax. And y'all made some jokes on the, on the notes today, but that's part of just, you know, if you're gonna do something, like, don't just wing it. And I do think there are a lot of, there are a lot of business owners that do wing it, and I think they need- I know … teams around them that can help them maybe be a little more prepared, that are thinking about those things that they aren't. Because if you told that business owner whose strength is whatever, from the hip, whatever- Yeah like I don't wanna change that out of that person. So just that person needs a team of people that are.

Joshua Wilson: 1:02:21

Yeah. So Ben, uh, we love your analogies. I'm gonna give everybody a chance to give one sports analogy before we wrap up. So be thinking, 'cause I'm gonna, I'm gonna pick on each one of you guys. So think of a sports analogy before we, uh, say goodbye and good game. That's mine. All right? So, um, but I wanna honor you for something is, is coming prepared to this. It, it showed that it was meaningful to you and thoughtful. You emailed us, and you, you shared that. So I wanna honor you and say thank you for doing that. Scott also prepares a ton with, uh, before guests. Like, we joke around. We try to mess with Scott before, you know, a guest interview, and he's like, "Shut up, guys. I'm trying to concentrate." And he's, like, writing stuff down, and he's, like, thinking about the people coming in and putting himself in their shoes. So, like, being prepared is so, so great, and we wanna honor that. All right. Ready for end of the game Sports analogies.

Scott Shea: 1:03:12

Ready, Scott? I don't know if it's an analogy as much as it is something that's always amazed me, and it's… I'm a golfer, so it's Tiger Woods. Um, obviously arguably the best ever, but his record when he had a lead or a tie for the lead after three rounds was, like, 55 and three or something, which is, like, mathematically impossible essentially for every golfer. So, and it's probably preparedness. Yeah. Like- Mm-hmm … when it mattered and when he had to close, like, it happened every time, and, like, nobody else has ever been remotely close to that. Um, I don't know what that's an analogy to-

Joshua Wilson: 1:03:52

Or it could just be a, a, a something- But it's- … sports related that's been- It's amazingly

Scott Shea: 1:03:55

impressive to me and probably a lesson, probably what Ben said, it's all about, like, it's been documented what Tiger did or what his father put him through as a child- Mm-hmm to be prepared for when the moment was biggest, and, uh, there's never been anyone better or even close.

Joshua Wilson: 1:04:12

Um, Billy Madison. Yeah. What about you, Jeremy?

Jeremy Beyt: 1:04:16

Uh, the one that came to mind, something we say here is, um, know when to swing for the fences and know when to bunt. Uh, in life in general, it's not always about trying to hit a home run, and, uh, I think people get caught up on that. Every moment, every project, everything you do, it's gotta be at home runs, but sometimes you gotta set someone else up. So that's the analogy that came to mind.

Joshua Wilson: 1:04:39

Nice. And then Ben?

Ben Vance: 1:04:40

Man, I feel like I unloaded a bunch of them. You used all, you used all yours. Yeah. I think I'm out of… not out of bullets, but… No, so I'm not gonna say, like, it ain't over till it's over. But, um, I'll… just finding these incredibly gifted athletes that- There's, there's always coaches and people surrounding them that, that they know they need people that are gonna hold them accountable to continue to be great. Um, and watching how rigorous, whether it's Jerry Rice or- Mm … you know, we talked, you know, basketball, Kobe Bryant comes to mind, and how early and often they would prepare, and that consistent effort over and over and over. Whether that's Ripken and how many games he played, but it's just surrounding yourself with people that are gonna make you better. Mm. Um, Saban comes to mind a lot. Like average people don't like high performers, and high performers don't like average people. So I, I think just being aware of, like, as great as you are, you need people that are gonna push you. That's what I enjoy watching.

Scott Shea: 1:05:41

Yeah, and I just, I think that's a perfect segue to close this, um, 'cause I think it goes with why we do this show, and, like, the… What we've seen is the, the best interviews and the best guests are those with stories. And I think the best and most inspiring athletes, they're not just great. It's the story that made them great and how they got there. Um, I'm with you, like the ones who had to work, and the ones like Jordan may be the best example. Like, he earned it. Mm-hmm. Like, he wasn't built like a LeBron. Yep. He was still athletic, obviously. But, uh, yeah, man, it's all about the story. I think that's what the podcast has become, too, so.

Joshua Wilson: 1:06:16

Cool. Then Scott, close us out, brother.

Scott Shea: 1:06:19

Jeremy, thanks for hosting, man. Been a great two days. It's been- Ben, glad I met you on the neighbor's back porch. Yeah. Shout out to Casey. Um- Yeah. Glad you came by, man. Yeah. Thank y'all. Awesome conversation. Josh, safe trip back to Florida, and, uh, you do the official close out. That's your move.

Joshua Wilson: 1:06:38

Guys, thanks for listening in. We'll see you all on the next episode. Cheers.