Selling the Family Business Without Selling Your Soul

Josh W: So Mike, super honored to have you here today. Um, you've worked with this group here with Scott. 

Mike F: Yeah. 

Josh W: And, uh, you sold a business, right? Yes. So, kind of tell us a little bit about who you are and maybe the, what it was like working with, with Scott and the team here, and walk us through that. 

Mike F: Well, uh, we owned a company called Dixie Electric.

My name is Mike Flash.

We own a company called Dixie Electric, who was a. Started by my father and another gentleman in, in 1979, and the business was alive and well through 45 years. Uh, in 2010, my father developed Alzheimer's and we had already started the buyout of, with my father, and he asked if we can go ahead and accelerate it and, uh, and get that part of that chapter closed.

And then my father passed away in, in, uh, 2020. Uh, since then, we, you know, we were, we were discussing the exit plan for us in the business. 'cause we were all starting to get a little age on us. And when we decided the number that we actually wanted to retire, we, we, uh, we started thinking about it a lot harder.

Out of the blue, we got a phone call from this gentleman who was interested in buying the company. And after having discussions for about 10 months, one of the concerns we had was that we couldn't get a good guarantee that they were gonna take care of our our workers, and that was just as important for us as getting a paycheck.

Several months after we broke it off with 'em, they came back to us again. And we were got into discussions. Again, they were, they knew what, what we were looking for and they started talking a, a, uh, a better game. But the longer we did it, the more we realized that in reality, if once we signed the papers that nothing was gonna be changed as far as for the, the incentive and stuff we had for our guys, that they weren't gonna honor it and, and my guys wouldn't get taken care of.

Right after we broke it off with him

or during the, before we broke it off with him, we had another friend of ours, his name is Brady Cuomo, and he, they had just not long closed a deal for them, for him, and he said, you gotta meet these guys. He said, they're well worth the money. He said, you are in a, in a. You are in a realm that you know nothing about.

And he said they're gonna keep you outta trouble and get you the best amount of money they can get for your money, for your company. So that's when we signed a contract with him and uh, and then they told me that Scott was gonna be the guy handling it. And I said, no, no, no, please, no Andy. Called me down, they sat me down.

They said, look, Scott's really a good guy. I said, no, he is not. And they said, yeah, yeah, he really is. He said, but you gotta really, really look deep into him. And I said, I don't wanna do that. But anyway, make a long story short, I knew Scott was a good choice and uh, Scott was the one who ultimately helped us with the deal.

When they sent out the packages, the first deal that they came up with was a family member of of Scott's. And I said, we gotta get him outta here. That's nepotism now. You know, it's just not gonna work out. He's not gonna represent us and all this good stuff. And to make a long story short, we ended up signing the paper with the, uh, contract with, with.

Family member, uh, it did end up being nepotism. He took good care of his family. All joking aside, we were very satisfied with the outcome and uh, Scott did do a good job with us and he did a good job of, of separating the family portion and, and the business portion and representing us the way he needed to represent us.

Josh W: Yeah. So, Scott, you've known Mike a while. And, and he actually, you there's some history there. Why don't you kinda share, you know, how, how you came to know Mike and maybe part of that story? 

Scott Shea: Yeah, so I, I knew of Mike. Um, I did not know Mike. So my family, as you know, had an oil fuel service company and Mike's company did a lot of the electrical work over the years, um, small town where we're from.

Um, so I knew the name Dixie Electric was, you know, well known in the community. Um. I knew the Flash Brothers. I didn't know Mike, like I know Mike now. Um, so yeah, it was a, an honor when they came to us and trusted us. Um, but also cool 'cause coming from a family business, I felt like I knew exactly what they were going through and what the pain points may be.

Um, was interesting that the ultimate buyer was a family member who I once shared a conference room with in the family business. Um. I negotiated hard with them, so it was enjoyable. There's been some good jokes since, but, uh, yeah. Funny how things come full circle sometimes. Yeah. 

Josh W: So it came from family business where your dad in the green room before we hit record, you were talking about your dad always had a dream that Mr.

Money bags would come, right? 

Mike F: Yeah. He, he had a dream that Mr. Money bags would, would come in one day and just buy the business and, uh, then we'd all go home happy and fat and sassy, you know? 

Josh W: Yeah. 

Mike F: And, uh, unfortunately he passed away before that happened. And, uh, but we, we made sure to, to have a toast to him that.

Money bags did come along and, and, uh, and, and buy up the business. 

Josh W: Yeah. If, if you could remember the toast that you gave to your father after you sold the business. So you guys, you know, find out these guys over here, Scott and the, and the group came in and, and helped you after, you know, a 10 month engagement with a first buyer.

Broke up, kicked it around a little bit, came back second engagement, kicked them around for a little bit and then finally, you know, these guys came in and they were able to help. I, I'd love to hear that. How, how things went differently, right. Trying to do, kind of figure it out on your own versus bringing in an outside, you know, advisor.

But first, let's, let's go to, do you remember the toast you gave to your father after you exited? 

Mike F: Well. I only have one toast that, that I give. 

Josh W: Is it safe for tv? Okay. 

Mike F: His two friends who know me well, but love me anyway. 

Josh W: Oh, that's good. Love that. That's really special. 

Mike F: And, uh, but no, we did, we did give a toast to Dad after we, uh, signed the papers.

We, uh, we all went to dinner and, uh, not with Scott and them.

Scott Shea: You weren't invited. 

Mike F: We wasn't invited. 

Josh W: Yeah. 

Mike F: And, uh. And it, it was, it was, uh, it was very surreal. It was, you know, you had to pinch yourself and, but it was still gonna be a couple of months before everything was gonna be finalized and closed 

Josh W: for sure.

Mike F: And, uh, but, uh, and then the day of the close, we had a, the new owners did a toast and my father and, and uh, it was very nice. 

Josh W: That's really special. 

Mike F: Yeah. 

Josh W: So representing yourselves, you and your brother. Always a dream of, of the, the flash family to, to build this into exit one day. That happy and sassy is, is what you said, right?

Mike F: Yeah. 

Josh W: Uh, representing yourself. What was the difference between representing yourselves and your family, right. Have built this your whole life and then here comes the exit and then working within a, an advisor? 

Mike F: Well, when we were, uh, dealing with the other company, the original company 

Josh W: mm-hmm. 

Mike F: Uh. Everything was, they would bring up terms and everything was Greek to me.

And I thought I knew a lot about business. And then I realized how little I knew about exiting a business. It's one thing to run it and build it, but it's another thing to get out of it. Right. And that's when Brady Cuomo came along, a friend of ours. Someone that they had closed, uh, Dior, uh, not long before that and gave a high recommendation of these guys.

And that was when we, we decided to sign on with 'em. It was just, I didn't have to negotiate per se. 

Josh W: Mm-hmm. 

Mike F: We would go back and forth on stuff and we would do markups and, and, uh, and when I had a question about a term or, or whatever. I would ask it and I'd get, I'd get an answer and I understood what was going on.

And, uh, that was the biggest thing. And, but I didn't have to go and necessarily sit in a room and, and tell you that's not what they're gonna, that's not what they want. You know, they, they were able to do, be the, uh, be the bad guys or whatever on that, 

Josh W: right, 

Mike F: on that part of the deal. Uh, you know, like I said earlier.

It was, it was members of, uh, Scott's family. So if I had something really, really personal that I wanted to ask, sometimes I would, I would, uh, have the conversation straight with Jude just to, just to make sure we were going in the right direction of, 

Josh W: for sure. 

Mike F: And uh, and that was never an issue though.

Josh W: Yeah. Well, what I think is very cool, and I'd love to hear your side of this, uh, Scott is. Family business, two generations, right? You guys were the Flash brothers. What was, what was dad? What Did you guys flash Daddy, or what was, what was he That was pop, pop Man, I love, oh yeah, that's an electric thing too.

Scott Shea: Yeah. There you go. 

Josh W: All right. And then, you know, so family business grew up in a family business where you guys service and then a part of the family actually bought the business, right? So there's, there's a lot of family in this. So Scott, you know. You as you approached this opportunity, you know, what was going through your head in terms of, uh, potential buyers and what was your, what was your process for looking at his business and maybe that, that first stalled attempt mm-hmm.

Where, you know, two years kind of, kind of down the drain in terms of, uh, selling aspect. So talk to us about your sales approach and, and how you looked at this deal. 

Scott Shea: Yeah, so first we always try to understand the goals and what's important to. The client, Mike, you know, referenced it earlier, the employees post-transition mm-hmm.

Was very important. Um, the legacy of the business, uh, their future. They weren't ready to retire, but ready to plan for retirement. 

Mike F: Yeah. 

Scott Shea: Um, so what would that transition look like? Um, that's a big part of it. Um, initial buyers, we were thinking, you know, would be some big strategic buyer in the electrical contracting space.

Maybe a private equity group. Um, did not think it would be previous, uh, guys I shared offices with and, and family members. Um, but I always thought it would be a great fit because our family sold and the end of the story wasn't necessarily, you know, storybook. Most of us ended up leaving. Um, so through that learned a lot about what a transition and should look like.

Josh W: Yeah, 

Scott Shea: so I was very confident. That these guys would be happy with how the new owners would, would come in and operate it and kind of having learned what to do and not to do. Um, and I've mentioned to you before, we always judge a, obviously closing is a success, but two years down the road, if we can have a client say there's no regrets, um, that's the true success.

We're not to that point yet. We're probably about a year into it, but, uh, so far so good. 

Josh W: Yeah. 

Scott Shea: Um, but. That's really important to me personally is that these guys are, when it's all said and done, are happy with the decision they made. 

Josh W: For sure. 

Mike F: Just a clear air. It's been, uh, eight months and, and 12 days.

Scott Shea: Eight 

Josh W: months. And 12 

Scott Shea: days. Not that he's counting retirement 

Mike F: nine months as 12. 

Josh W: Yeah. So Mike, let's, let's talk about that transition out being known. You know, you go, you drive down the road, your trucks, you're, you've got the shirt. Right. That shirt's been on and, and that, that the magnet's been on side of the pickup truck forever.

1979. You probably had a really cool F-150 or a cool, you know, Ford truck. 

Mike F: It was an old used beat up truck when we first started for sure. 

Scott Shea: And Josh back in one fun fact that probably took me like, I don't know, three or four months into the process. The, the name Dixie Electric. I just assumed it was. Like a, you know, reference to the South or, um, it was actually his mother's name.

Yeah. Which, oh, 

Mike F: okay. Her name. 

Scott Shea: How interesting. Your 

Mike F: mother's name's Dixie. Her main name was Ray, so it was Dixie Ray Flash. Wow. Which really sounds like a stripper name. 

Scott Shea: Yeah. So I always thought that was really cool and didn't know for, like I said, quite into the process. Uh, I was, oh, that was your mom's name.

Now it makes sense. 

Mike F: Over the last couple. Couple of years before we sold, we've gotten calls specific more, uh, during COVID that, uh, y'all need to change y'all's name really? This was people off the street that were calling that, and I said, I would never ever do that to my mother. 

Josh W: Yeah. 

Mike F: They said, what are you talking about?

I said, we named it after my mother. 

Josh W: Wow. 

Mike F: And I said, her name just so happened to be Dixie. 

Josh W: Right. 

Mike F: And, uh, they said. Oh, well, we didn't know that. I said, you shouldn't jump to conclusions 

Josh W: here, pe here's people who don't know any, you know, who don't know things are telling you what you should do. 

Mike F: That's 

Josh W: right.

And you successfully built, you know, a two generation business and had a, had a good exit. 

Mike F: Yeah. Yeah. 

Josh W: Man, those, those phone calls, we, we all love 'em. We were just talking about unsolicited advice from, from people who've never done it. 

Mike F: Yeah. Right. Yeah. 

Josh W: Um, but from a guy who has done it, built and sold the company.

The, one of the, the hardest things, you know, we've, we've seen in the industry is that the succession from generation one to generation two and then that the sell off to someone else. Right. That's, that's a very hard thing because it becomes a part of the family, the identity, the community. Talk to us about what went through your mind, your heart going into that.

Mike F: Well, you know, we have to back up a little bit on that. Ideally we would've liked to have seen a third generation take over the business. 

Josh W: Mm-hmm. 

Mike F: Uh, 'cause dad was well taken care of when, when we bought him out, uh, and we bought him outright because we had to be fair to our, the rest of the siblings in the family, that wasn't a part of the business.

Josh W: Right. 

Mike F: And, uh,

none of us had, none of us had boys. I had a sister that had a son and he wasn't interested in the business. I had another sister that had a son and he worked for us a little while and he wasn't interested in the business and, uh, now he regrets it. But, uh, so I had my, I had a son, but my son was severely handicapped and, uh, there was no, no way that he could possibly take, take the business or try to run with it.

So, and my brother just had, uh. He just had one daughter. 

Josh W: Mm-hmm. 

Mike F: So, you know what, we, we, we were, we were left with only one option. After that. It was, we had this, we had to sell it or close it, and we were hoping we weren't gonna have to do that. 

Josh W: Wow. I've got two questions in my mind, but the first one I ask will be the easier of the two questions is, you know, like the, the thought of just closing it.

You, you mentioned earlier in our conversations that you, you shut down a deal from a potential buyer because you didn't feel that they would honor your employees or the legacy of the name. Right. So that was an important motivator to you to not sell to them specifically. So, and then closing it down seems just as bad.

Mike F: It, it, it, it would've been, 

Josh W: yeah. 

Mike F: And, uh, because, you know, you. Not just you, not just feeding your employee, you're feeding their wives and their, their, the security of their families. And, uh, you know, if you, if, if you sell to somebody that's not gonna, that's gonna have a substandard in, uh, health insurance policy or is not gonna contribute to their 401k and.

Not gonna help 'em if they, if they get in a financial bind and, uh, and loan them, loan them cash. If they need cash, you're not taking care of your guys because, you know, it's, you can't do it without your employees. 

Josh W: Mm-hmm. 

Mike F: So why wouldn't you want to make that your priority? 

Josh W: Yeah, 

Mike F: because with just ourselves, we, we could.

We couldn't do the work that 50 people were doing, 

Josh W: man. So good. Scott, when it comes to looking for strategic buyers with that buyer, uh, the seller's motivation of legacy, taking care of the employees, taking care of the name, the brand, the field, the community, not just the financial transaction, how do you approach a buyer?

With that in mind, where it's not just a financial decision, but it's about legacy, it's about those kind of things. How do you do that? 

Scott Shea: Yeah, so first I'd say the, the financial piece is almost always the most important. 

Josh W: Mm-hmm. 

Scott Shea: Um, closely followed by, you know, employees and culture and, um, you know, legacy.

Um, so usually from Jump we're focused on the financial piece. And then, you know, in a perfect world you have multiple buyers that, that our clients can evaluate and usually they'll have a pretty good feel over, you know, how are my employees gonna be handled? How are they gonna be taken care of? What's the culture of the company that's acquiring us?

Um, a lot of that comes down to just kind of gut instinct. Um, 

Mike F: well talking about gut instinct working for his, their family business for so many years. Mm-hmm. We knew how, how they treated their employees, and I, I couldn't imagine them treating ours any different. And, uh, we were right. So, 

Josh W: Hmm.

Part of your, um, mind was. If we just close this, think of all the people who we're maybe not providing care for and their families and all that. So you, you have this heavy words, the crown is the, the crown of leadership. It's, it's not an easy thing to manage and, and sleep on every night, especially with, you know, multiple people.

I gimme, gimme an idea of range of how many, how many heartbeats you guys helped. 

Mike F: Well, I mean, over the period of 45 years. 

Josh W: A lot. 

Mike F: Probably thousands. 

Josh W: Yeah. 

Mike F: You know, uh. We, one thing we didn't have is we didn't have, uh, revolving doors with employees going in and out because they were taken care of. The unfortunate part about it is, is after a while they feel entitled.

And, uh, it's, it's no longer a benefit. It's an, it's an expected expectation. 

Josh W: Sure. 

Mike F: Which is fine. You know, you, you learn, learn. You learn that that's just a part of the beast, you know? 

Josh W: Mm-hmm. 

Mike F: And, uh, so when. When, when Jimmy and them came, came with this deal. And Jimmy being his, uh, your uncle, correct? 

Scott Shea: Yeah.

Uncle, cousin and cousin called uncle. Yeah. Post family. 

Mike F: We, we knew, we, we knew we had something that we thought we could work with on that one. 

Josh W: So, yeah. So that, that's really. It's, it's really special thing, um, as you're thinking of the employees, the heartbeats, the, the, the family, the culture, taking it through that lens, relaying that to, uh, Scott and team here with Jude and Chase now approaching buyers, you know, I know these guys are on phones all day to contacting buyers and, and, uh, creating a competitive market.

When you were doing that. You what, what words or thoughts would you hear maybe in the conversation or between the lines that you would filter out to not even get to him because you knew it might be a, a two year buy where they try to flip it or something like that. What, what were some of the buyers, don't say their names, obviously, but that you knew were not a good fit for what they were trying to build?

What, what was some of the. The, the, the key points that you're like, oh, not a good fit. Not a good fit out of the hundreds of calls that you guys made. 

Scott Shea: Right? Yeah. So this was, um, a little unique, I guess because it's located in a small town, first of all. Mm-hmm. Not a huge destination for, you know, big buyers looking to acquire companies.

Um, and it wasn't really a them sell and exit necessarily. It was a them sell with a. Plan to exit and save five years, which is a little unique as well. 

Josh W: Hmm. 

Scott Shea: Um, you know, most, most sellers are likely gonna be gone in a year or two after the trans, the, the transaction. Um, but yeah, really no negative feedback.

Um, kind of just knew once we found the ultimate buyer that that was probably gonna be the one, um. It's really, it's a small community, but a close community. Um, and I'd say South Louisiana, just in general is probably the most relationship driven, uh, this place that I've been, especially in business. Um, so you hear a lot of people with private equity, horror stories of right.

Companies coming in, and almost every time it's because they just didn't value the relationships that were, you know, spent 40 years building. 

Josh W: Mm-hmm. 

Scott Shea: Um. So I, I really felt that we had the right buyer, uh, pretty early on in the process because of that. 

Josh W: Very cool. All right, so my, this is, uh, the harder of the questions.

I hit the mic. This is, uh, the harder of the questions. You, you mentioned that you had a son and you know that, that this wasn't, uh. A suitable, you know, maybe the handoff there. Kind of walk us through that, that process or, or that story there. 

Mike F: Well, my son was, was severely handicapped and, and, uh, he was 27 years old when he passed away.

And it was, it was very surreal. We, uh, we, no one expected it. He was expected to live. Full life. Mm-hmm. He was, uh, gonna always have to have 24 hour care, but he was severely autistic and he was severely epileptic and he was nonverbal. And, uh, he was also born with, uh, undiagnosed neuromuscular disease, which was non-progressive, but it allowed him, despite what the doctor said.

He, he, it allowed him to walk. They said that he would never walk. He couldn't run, he couldn't, you know, but he was able to get around and, uh, so that, that, that really helped out. The, the, the neuromuscular part of it made the autism very palatable. He does it, you know, he didn't, didn't. Act out. He didn't, there's a lot of things that, that's normal with an autistic child that, that he just didn't have the energy for those traits 'cause his muscles would tie up tire out real easy.

And uh, so we were very lucky in that sense. We had, uh, planned a trip to go to go to Cuba with some friends and, uh, he was. The night before we left, he was just in a very silly and playful mood. And every night before he'd, he'd go to bed, he'd come in the living room. He had a day room. We didn't like him staying in his bedroom at night, uh, during the day.

So we had a day room for him. And when he was ready for bed, he'd come and he'd crawl on my lap at 27 years old when I'd rock him to, he was just about to doze off. And then I'd walk into his bedroom and we would both tuck him in and he'd go to sleep. Well, that night he would just wouldn't settle down and go to sleep.

Josh W: Mm-hmm. 

Mike F: But during the course of the night, we got a call, uh, from my wife's mother and my wife's father had passed away. And so we went to the hospital and we were trying to decide if we was gonna go ahead and, and continue to Cuba the next morning. And they said, don't worry about it. We'll take care of everything when y'all get back.

So the next morning we left about three o'clock in the morning, uh, jumped on a plane in Lafayette, Louisiana, and we flew to Dallas and our next stop was Miami. Well, we went, we had boarded the plane to go to Miami. In Dallas. They. Closed the doors pulled away to Jetway and my wife just flipped her phone on real quick just to see if she had gotten a text in the meantime.

And her phone starts ringing and it was his, uh, caretaker and she said that she went to get him up to for breakfast and take him to the bathroom. And, uh. He had passed away during the night. 

Josh W: Oh geez. 

Mike F: So it was very difficult to get off the plane at that point because once they closed the doors, they're not supposed to open 'em until the next destination.

And the flight attendants were doing their job. But, uh, the very compassionate pilot came out of the cockpit and wanted to know what was going on, and we explained it to him and he. Called him to bring the jetway back, and they opened the doors and he actually walked us Wow. To a ticket counter and made sure that we had arrangements back home as fast as we can get it done.

So we made it, made it home that same afternoon. And, uh, and when we got home, uh, it was true. He, he had really passed. So I was on the board of the local community college. Uh, we cover seven parishes. Seven campuses, not in seven parish, but we have seven different campuses. And, uh, I had been on the board probably about two years at that time.

And, uh, it. They came to me, they said, would you like to start some type of an endowment? In his memory, this is why we're sitting at the funeral home. I said, yeah, I might wanna do something, you know, and they said, well, you know, it's a minimum $10,000, uh, investment for an endowment or otherwise, it's just a scholarship.

And uh, I said, I said, we'll, we'll do an endowment. And uh, so we reached out to friends and family as well as. Ourselves. And, uh, we started putting money into his endowment. And after about two years we had, uh, $50,000 in the endowment. And the school submitted a request to the, uh, board of Regents because the, his, his scholarships went, went primarily to nursing students because of all the help he had over 

Josh W: there.

Oh, yeah. That's beautiful. 

Mike F: And, uh, we were able to get a hundred percent match. So we went from 50,000 to a hundred thousand dollars on his endowment overnight. And lemme tell you something, his memory has helped a lot of people. Every year we doing anywhere from two to four scholarships and, and, uh, I just want a pat on the back every time, every time that happens, but 

Josh W: for sure.

Mike F: It was seven years last week that he passed away. And, uh, we went through a lot of good memories of him, you know, as it's, it's, uh, it's still hard, but we know there's a reason for everything. We believe in our Lord savior, and, uh, we knew that. We knew that he knew that we didn't need him anymore, that, that he needed him, 

Josh W: he 

Mike F: brought him back home.

Josh W: That's special 

Mike F: because our children are only, they're only on loan to us, you know? But, uh, so anyway, that's, that's how that story went. Now, you know, in my ninth year on that board, I'm, uh, president of the board now, and, uh, we'll be for the next two years and, 

Josh W: mm-hmm. 

Mike F: I'll exit outta that. 

Josh W: Mm. 

Mike F: About the same time that I'm exit out of Pixie 

Josh W: Man.

What an honor. Um, yeah. Thank you for sharing that story. There's so many things that happen when you're building a business and you're running all these things and you have all these responsibilities, and then you get a phone call like that, or text message, and then we, we see. I think you've done well at this, Mike, from what I've heard about you is you prioritize well, your faith and your family, and I wanna honor you and you know, your, your family for, for how they treat people and, and how you guys prioritize that.

Appreciate that. So thank you for sharing the story of your son

Mike F: can honor him with a $10,000 check his endowments, 

Josh W: Scott, take care of that for us. Take care of that. Yeah. But act actually for, for people listening in, uh, please tell us the name of the endowment or maybe where they could go. And find out more information about that.

Mike F: Well, it's a part of the, uh, south Louisiana Community college system. It's, uh, it's called Solar cc. 

Josh W: What is that?

Mike F: Solar. Solar cc. S-O-L-A-C-C, community College. 

Josh W: Okay. Yeah. 

Mike F: Uh, and there's a, a donation link on their website, and when it asks us it, it'll ask a question. Uh. What do you wanna donate to? And they'll, they'll have d different choices and you click other and it's gonna, you put in the rhet Flash Memorial Endowed scholarship.

Josh W: And what, what's his name? 

Mike F: Rhett. 

Josh W: R-H-E-T-T. 

Mike F: Yep. 

Josh W: All right. R-H-E-T-T. Rhet Flash 

Mike F: Memorial Endowed Scholarship. 

Josh W: It's special 

Mike F: and you put in the amount and it's in a credit card and it's a done deal. 

Josh W: It's a done deal. Well, really honored to hear this story and we as a team will, will give to that. Um, Mike, in your it, it's hard to ask a deal question following, you know, the following that, so not transitioning but kind of piggybacking on this a little bit.

Um, two questions. One is more personal and then we'll move over to the deal side a little bit. You mentioned, you know, your son was autistic, non-verbal epileptic, but he was silly and playful, so maybe he was non-verbal. Maybe he didn't speak, but he, he still communicated to you, 

Mike F: still communicated very well.

How, 

Josh W: how did he do that? 

Mike F: He would do it a number of ways. Uh, sometimes it was, it was gestures, sometimes it was expressions. 

Josh W: Yeah. 

Mike F: But a lot of times he would just. Bring us to whatever he want was asking for. And he'd grab our hands and he'd put our hands on what he wanted. 

Josh W: Hmm. 

Mike F: And it, it always drove me crazy because if he could do that, why didn't he just get it himself?

We, we had him spoil pretty good. 

Josh W: Yeah. He can join him. Bringing you in, huh? 

Mike F: Yeah. Yeah. Tell you a funny story. Uh, he didn't like to go in, in crowded places that just. Kinda set him off. So we made sure we brought him in crowded places 'cause he needed to get past that. 

Josh W: Oh wow. Yeah.

Mike F: And uh, I brought him to Walmart one day and I was buying a hunt license and I was buying some bullets and all this other stuff and, uh, I would always hold his hand and he pulled his hand outta mine and I figured he was just standing there and I'm talking to the lady and in no time she said, uh.

Is that your son and I looked over and he was laying out on the floor, not a stitch of clothes on in Walmart, in the sporting goods section, and I said, man, I'm sorry. He takes after his mama. 

Josh W: To be honest, that's kind of a normal thing for Walmart anyway. Yeah, yeah. I mean, what a, what a fun, funny story, right.

Mike F: There's millions of those. 

Josh W: Yeah. 

Mike F: Yeah. 

Josh W: Wow. That's special. Um, we'll, we'll go to family dynamics and deals, Scott, when working with a family business and representing family businesses, what do you think? Because you came from the world of family business that sold to a public company, so you got to see the exit, the transition.

Mm-hmm. And you got to see the post-integration and you, you know, sometimes it works good, sometimes not so good. The, you know, working within a family business and now serving family businesses like Mr. Flash here, you know, what is something that you've learned when working with family businesses that maybe someone, if they didn't have that experience representing as an advisor, might not approach to 

Scott Shea: me's the culture?

Family businesses generally have a really strong culture. Um mm-hmm. Then the goals are a little different. So owners of family businesses are much different from, say, a, a private equity group where they're buying a business with the, really their only goal is to generate a, a return on investment. Um, there's not much emotion involved When you own and operate a family business, there's a, you know, sentimental component.

Um. From Mike, his, his dad started, it was named after his mother. Um, the property was named after his son, I believe. Or the, the, yeah. Rat 

Mike F: investments. Yeah. 

Scott Shea: So there, there's just an emotional aspect that doesn't exist in, you know, public entities or, or private equity owned entities were ultimately results or judged by, or success is judged by financial results.

Mike F: Mm-hmm. 

Scott Shea: Um. Whereas, you know, family business, it's, you hear stories all the time where, you know, they may sacrifice profits for COVID was a great example. So many companies kept their employees on the entire time when maybe they weren't compensated to do that. Or at least not in full. Um, you know, because they care about the, the employees and the team and the culture and, um, to me that's the biggest difference in family businesses.

Really any business owned by an individual, um, you know, it's part of them, it's part of their DNA. 

Josh W: Yeah, that's fantastic. Mike, as we kind of near towards the end, um, of our conversation, conversation number one, hopefully of many, um, it's really, you know, really honored to meet you, um, when dealing with. Uh, or maybe advice for people in the audience who have a family run business that had, you know, been doing it for 40, 50 years.

It's a part of their identity. It's a part of who they are, and they're thinking about one day selling, but they're afraid or they don't know the next step. What advice do you have for them? 

Mike F: Well, the biggest advice that I have is the, the first step. Normally when you wanna sell a business, and we didn't take that steps because.

We have a disdain for for lawyers is to go, go talk to your lawyer about it. And

yeah, your average lawyer cannot put something like this together. It takes a lawyer that this is what, what he does for a business. Jude was a lawyer who had. A disdain for lawyers, 

Josh W: right? 

Mike F: And he started doing this and then gave up his, his, uh, law practice in order, in order to do this. But it takes a special kind of person to do this.

The hardest thing you gotta, that you have to understand is that you're gonna be giving up part of the money that you're gonna be making to pay these guys. All I have to say about that is. If you don't know what you're doing and you try to go at it alone, you're not gonna get the return on your money the way you would with hiring somebody like these guys.

Uh, I it, that was a big check. I wrote 'em, it was a big check for me, but, you know, $2 candy bars a lot for me too. But, uh. I didn't mind writing that check because I, I knew that in the long run that we would've, if we would either died of a heart attack trying to get this deal closed or we would've made a lot of mistakes.

There's no question about it. 

Josh W: Yeah. There's no better, nobody better at running an electrical company than you guys. Right. But when it comes to selling your business like that, that is a. That's, uh, sometimes people do it once in a lifetime, right? 

Mike F: Yep. 

Josh W: So, yeah, I think, uh, I appreciate you sharing that, and I, I'm awfully fond of these guys as well, and, uh, I'm glad to be a part of this group.

So, uh, both of you, are there any questions that I, I should have asked that I completely screwed up and maybe did not ask during this interview that I, I should have brought up? I don't think so. 

Mike F: The transition, 

Josh W: yeah. Talk to us about that. What do you mean by transition? 

Mike F: That means the. The part of continuing working for the company and stepping back as employees and not owners, uh, that was difficult.

You know, that first time that the employee comes to the office and says, Hey, look, we got this, and you have to look 'em in the eye and say, I can't make that decision. I don't even know what my job is right now. I can't make that decision. That's tough. And then the next thing is when they stop coming and asking you questions about, about certain things and, uh, that's difficult and then that then you, people are running the business a lot different than what the way we ran it.

Josh W: Hmm. 

Mike F: They're not doing it wrong, it's just a different philosophy. 

Josh W: Right. 

Mike F: Uh, case in point is we would buy a piece of equipment and we run that equipment until we definitely didn't wanna sell it to a friend. You know, it was, uh, we had gotten its full life out of it. Uh, we spent a lot of money on maintenance because of that and repairs.

These guys don't do that. When they hit a certain amount of money on repairs, they get rid of it. And it's just a different philosophy and we just, we feel that the way we did it might've been a, I guess it was good for us, 

Josh W: right. 

Mike F: You know, because, uh, you get, you get used to a certain type of equipment and then you change it to a different brand or a different.

Whatever. 

Josh W: Yeah. 

Mike F: Especially when you get into to the heavier equipment, like the bucket trucks, whole set of trucks 

Josh W: For sure. 

Mike F: And, uh, so that, that was tough. And you know, the, there's other things that, that come into play and, you know, we we're about nine months into it now and you know, I just take a step back and it's not mine anymore.

Josh W: You 

Mike F: know, it's up to me to help these guys make. Make the living that we made and even better, you know, so that when they decide to sell it, they'll be selling a much bigger company than us and have a bigger return. 

Scott Shea: Yeah. Just to, to, to add to that, um, that's the emotional aspect I touched on earlier and you see it a lot when you near the end of the deal process where reality sets in.

This won't be my company anymore. Um, I may not even be there anymore. Um, that's when the emotions get strongest. Um, usually the paycheck at the end kind of alleviates that. Um, but Mike was always good. He's got this like, calm thing he does. He was, uh, he's really good at blocking the emotion, at least externally.

I don't know what goes on inside the, the head, but, you know, making decisions, uh, purely based on, you know. Facts and, um, analysis, not, not the emotional side, which is easier said than done. Um, it's a very hard thing to do and you know, we've seen Jude specifically seen almost everything that you can see in a deal over his career.

And sometimes it's really small things that people are, you know, really fixated on. Like, they're not gonna have their gas card anymore. And they want to kill a multimillion dollar deal. Um, so the emotions and regulating those and so important. And, uh, yeah, Mike's got that. I don't know how how he does that, that, that calm control.

Josh W: I, I think that's a really good question that he poses is how do you do that? 

Mike F: Just take a deep breath. Yeah. Um. My brother's got, he, he, he operates more in emotions than he does. Uh, you know, he, he's not gonna take that step back. He's gonna react. And, uh, and with what he did in the business, sometimes that was the better way that to handle it.

You know, he, he dealt directly with customers and he dealt directly with the employees where I've dealt with the employees more. I dealt with him every day, but it was more passive. It wasn't, uh, as direct as he did. 

Josh W: Right. 

Mike F: Uh, you, you gotta learn that you can't be there. You, you can be their friend, but it's a work friend.

Josh W: Mm-hmm. 

Mike F: It's not a personal friend. You're not gonna friend them on, on his social media. You're not gonna, you know, you're gonna, not gonna allow your private life to become exposed. Because you, you're a different person at work than you are at home. 

Josh W: Yeah. That's good Ben. So as we wrap up, uh, Mike, thanks for coming on.

Uh, we want to, I guess. I don't know how, how, how much this means, but we'd like to, you know, dedicate this episode in, you know, to you, to Rhett, to pop to Dixie. And, uh, you know, thanks for coming in and, and for sharing this time with us. Don't forgive 

Mike F: my wife. 

Josh W: Yeah. And your wife. Yes. 

Mike F: Because what the, the, the wives and the family is the ones who pay the price.

Josh W: Oh my gosh. For sure. 

Mike F: For sure. Because for the long hours and the weekends and stuff that we're not able to, uh, spend with 'em. 

Josh W: Well, Mike, here's your opportunity to get some brownie points. Why don't you give a shout out to the wife? 

Mike F: Honey, I'm coming home. 

Josh W: All right. Very good. Well guys, thanks for listening into, uh, the Deal Podcast, you know, on this.

On this podcast, we're not just talking about deal dynamics and arbitrage and m and a, you know, we, we really like to peel back the curtain with what's going on in the heart, the mind, the psyche of, of someone buying or selling a company, and the motivations that lead to deals. So if you're working on a deal that you'd like to talk about here on this show, just hit the contact button at the top of our website and, and maybe shoot me a note and let me know what you're working on.

And, uh, I just wanna say thank you. If you go to the show notes, you'll, you'll find the, the link and the information to, uh, the ret flash, uh, Memorial, uh, foundation, right? 

Mike F: In Dallas Scholarship. 

Josh W: Yeah. So that'll, that'll be in the show notes too. And uh, we're just super grateful for you guys and we'll see all on the next episode.

Cheers guys.