Achieving Success through Innovation and Strategic Risk-Taking

In this episode of the DealQuest Podcast, Dennis Stearns, founder and CEO of Stearns Financial Group, who is known for his expertise in financial planning for ultra-high-net-worth clients and his insights into super trends affecting the economy, careers, and investments. Dennis, a recognized financial futurist, has built a successful firm specializing in comprehensive financial planning, helping clients reach their financial goals through strategic risk-taking and innovative strategies. He discusses his approach to business, the importance of resilience, and how thinking outside the box led him to greater opportunities in his industry.

Dennis talks about his early days, working at a traditional financial firm before realizing that innovation and challenging the status quo were key to building a lasting business. He reflects on how taking calculated risks—whether in business or in investments—allowed him to transform his career and his company.


ANTICIPATE CHALLENGES IN DUE DILIGENCE TO AVOID DEAL BREAKERS

Before a business transaction, it’s crucial to do a thorough check on the business’s current status—this is called pre-due diligence. It helps sellers spot and fix any issues or gaps before the buyer’s team gets involved. If left unaddressed, these issues could derail the deal later. Buyers are always looking for reasons to back out, so addressing potential problems early on reduces risks and helps smooth out the process. For example, correcting a financial discrepancy or clearing up a legal issue before the buyer's team starts their review keeps everything on track.

Dennis' key advice: anticipate challenges early to avoid roadblocks. By vetting everything upfront—especially financial and legal aspects—you’ll avoid unpleasant surprises and keep the deal moving forward.


CULTURAL SENSITIVITY IN GLOBAL NEGOTIATIONS

Dennis highlights the importance of understanding cultural differences, especially in international negotiations. He shares his experience working with German companies, who tend to be methodical and precise in their approach to business. Knowing and respecting these cultural nuances is key to building rapport and making negotiations run smoothly.

By adjusting your approach to align with the cultural expectations of your partners, you can avoid misunderstandings, earn their respect, and land better deals. In today’s global business world, cultural awareness isn’t just a nice-to-have—it’s essential for success.


ADAPT TO TECH AND GEOPOLITICAL SHIFTS IS KEY FOR BUSINESS SURVIVAL

We're in the midst of a fast-paced transformation driven by the Techno-industrial revolution. Technology is evolving rapidly, reshaping industries, and changing how businesses operate. If companies don't keep up and integrate new technologies, they risk losing relevance.

Take North Carolina, for example. Traditional industries like furniture and textiles were hit hard by globalization and outsourcing. But instead of disappearing, the region adapted by pivoting to high-tech sectors, like producing advanced materials for fighter jets. This shows that businesses that embrace change and technology can thrive, even in entirely new industries.

For business owners, it's crucial to stay alert to these shifts. Whether it’s automating processes, going digital, or adopting new production methods, evolving with the times is necessary for survival. Plus, geopolitical tensions, like potential military conflicts, can disrupt markets and supply chains, so staying proactive is essential.

PLAN FOR TAX AND POLITICAL RISKS IN EXIT STRATEGY

If you're thinking about exiting your business, it's crucial to factor in potential tax changes and political risks that could impact both the timing and value of your exit. One key consideration is the expected rise in capital gains taxes after 2025, which could lead to a larger tax burden when selling your business. To avoid this, it might make sense to accelerate your exit plans and lock in the current, more favorable tax rates.

Beyond taxes, geopolitical risks are also something to watch. For example, growing concerns over China potentially invading Taiwan could disrupt global supply chains, especially since Taiwan produces 90% of the world’s advanced semiconductors. Such a conflict could shake up markets and investor confidence, affecting the stability of your business.

If you're planning an exit, it’s important to assess how these risks could affect your business’s value. Having a flexible strategy that anticipates these challenges will help you protect your assets and ensure a smoother exit when the time is right.


THE IMPACT OF GLOBAL INTERCONNECTEDNESS ON BUSINESS

The global economy is more interconnected than ever, and events in one part of the world can significantly affect businesses, no matter their size or international presence. For example, during the pandemic, even U.S. companies with no direct ties to China felt the ripple effects of factory shutdowns there. This caused delays, shortages, and price hikes for materials.

Today, businesses must keep an eye on global events—whether it's a political shift, natural disaster, or supply chain issue—because these factors can impact operations and long-term success, even if the business has no international dealings. Preparing for these global risks is essential to maintaining stability and growth.


THE VALUE OF TECH FOR TRADITIONAL INDUSTRIES

Traditional industries, once untouched by technology, are now adopting tools like AI, automation, and cloud software to stay competitive. Even sectors like manufacturing and logistics, which were previously reliant on manual processes, are seeing huge benefits from tech integration.

For instance, manufacturers using AI for predictive maintenance can now anticipate when parts will need replacing, cutting costs and minimizing downtime. The best part? Tech-enablement doesn't always require massive investments in new ventures. Businesses can simply enhance their existing operations, making them more efficient and profitable.


ATTRACT AND RETAIN TALENT TO STAY COMPETITIVE

In today’s global market, effective talent management is key to staying ahead. Countries like China and Russia are facing a shortage of young workers, limiting their economic potential, while the U.S. benefits from a steady birth rate and skilled immigration.

However, it’s not enough to rely solely on a steady talent pool. To stay competitive, businesses must create an environment that values innovation and merit. By attracting and nurturing the best minds—both domestic and from abroad—companies can drive growth and stay ahead in an increasingly competitive market.


LEVERAGE TECHNOLOGY TO BOOST EFFICIENCY AND INCREASE BUSINESS VALUE

A company used smart technology to streamline operations, allowing employees to perform complex tasks with just tablets, instead of requiring specialized training. They focused on hiring people with common sense and a strong work ethic, rather than specific skill sets. This tech-driven approach made operations more efficient and fostered better collaboration across teams.

When a potential buyer came along, they were so impressed with the tech-enabled efficiency that they offered 50% more than expected for the business. This shows how leveraging technology can not only improve operations but also increase a company’s value in the eyes of investors or buyers.


EVALUATE BUSINESS POTENTIAL FOR LONG-TERM VALUE

The real value of a business goes beyond its current earnings and operations. When selling, both the buyer and seller need to consider the business’s future potential, not just its present state. As Dennis Stearns explains, sellers may not capture all the benefits of future growth, but that potential plays a key role in determining its price.

A business with growth potential or the ability to thrive in a larger organization is worth more than just what it’s currently earning. Sellers should understand how scaling could increase their business's value, while buyers should recognize the growth opportunities for a smarter purchase.


BUILD YOUR BUSINESS TO RUN WITHOUT YOU

Dennis shares how he’s structured his businesses so he can step away from the daily grind. By hiring skilled, adaptable people and setting up efficient systems, he’s able to free himself from routine tasks without losing control or sacrificing quality. This approach gives him the flexibility to take vacations or focus on bigger-picture growth and strategy. The key takeaway? Delegation and strong systems aren’t optional—they’re essential for creating the freedom to lead as a visionary, not just get stuck in the day-to-day operations.

Tune in to this episode of DealQuest to hear how Dennis Stearns built his financial planning empire, embraced innovation, and achieved success through strategic risk-taking and client-centric service.

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Listen to the Full DealQuest Podcast Episode Here

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FOR MORE ON DENNIS STEARNS:
Stearns Financial Group Website
Dennis Stearns LinkedIn
Dennis Stearns’s Facebook
Dennis' latest book: Ninja Entrepreneurs: How Top Business Owners Achieve Success Using Ninja Secrets and Force Multipliers.


FOR MORE ON COREY KUPFER:
Corey Kupfer's LinkedIn
Corey Kupfer's Website

Corey Kupfer is an expert strategist, negotiator, and dealmaker. He has more than 35 years of professional deal-making and negotiating experience. Corey is a successful entrepreneur, attorney, consultant, author, and professional speaker. He is deeply passionate about deal-driven growth. He is also the creator and host of the DealQuest Podcast.

Get deal-ready with the DealQuest Podcast with Corey Kupfer, where like-minded entrepreneurs and business leaders converge, share insights and challenges, and success stories. Equip yourself with the tools, resources, and support necessary to navigate the complex yet rewarding world of dealmaking. Dive into the world of deal-driven growth today!