Episode 275 - Solocast 65
Corey Kupfer: [00:00:00] Do you want your business to grow faster? Are you open to new and out of the box ways to drive revenues and increased value? How do you imagine the most successful entrepreneurs and business leaders double, triple, or expand their businesses tenfold or more? This is a weekly podcast featuring conversations with business owners, executives, and leaders.
As we reveal behind the scenes details that give you, our listeners, the confidence to pursue your own deal driven growth on the show. We discuss a huge variety of deals. Everything from large, complex mergers and acquisitions, capital raising, joint ventures, strategic alliances, real estate, affiliate and sponsorship deals, and more, including smaller deals that you can do without significant capital.
My name is Corey Kupfer, and I've been supporting deal driven growth for businesses for over 35 years as a successful entrepreneur, professional negotiator, and attorney. My goal is to help you strategize, plan for, find, and complete deals that will help your company grow [00:01:00] faster. Welcome to the DealQuest podcast.
Let's get started. As if you listen to this podcast, we don't only talk about M and A deals and capital raising deals, which is the deals that people hear most about. There are many other podcasts that only focus on those types of deals. And while we certainly cover those deals, we have plenty of people on, because they are two of the biggest most frequent types of deals that are done.
We also talk about other types of deals and I thought it'd be good in this solo cast to do a recap. It's been a little while. I just want people to start to, just think about the opportunities, right? So if you're a business owner top executive entrepreneur leader. And you're looking for ways to grow your business and not just through sales and marketing and providing very positive services.
We that's the whole purpose of this podcast, right? Is to have you be able to look at alternative ways to think about growing your business, to shift that mindset. From an entrepreneurial executive leader mindset only to also a deal maker mindset. While you certainly can grow [00:02:00] by raising capital, you can certainly grow by doing acquisitions.
You can certainly exit through doing acquisitions. There's all these other ways and we mentioned them, but I want to. Hit on some of them and talk maybe a little more specifically about different like where the opportunity is to use these various deals, different industries and examples on how you can use them.
So let's start out with joint ventures and strategic alliances, right? And these are deals that can look very different. The term joint venture is, or JV is used often in various contexts where it's described various things, right? But fundamentally, there are two types of joint ventures.
There's a contractual joint venture and there's like an entity joint venture, right? So you and I get together, we can have a contract where we're each obligated to do certain things. So we're going to move a project or initiative or product or service forward, jointly. Or we can set up a new entity in which we co own that entity, or maybe our existing company is co owned that entity and for the same purpose.
And many times I think people jump [00:03:00] to automatically looking at acquisitions, right? Buying a selling, but there are a lot of reasons why people may not want to do that, whether it's loss of control, it's not time, they think that the value is going to go up over time and it's too early to sell.
Lots of independence, obviously when you do an M& A deal, and there's usually somebody who is the owner of the, let's say, selling company, right? Smaller company often, that, their role is going to significantly shift. Now, maybe they're doing it for succession purposes or whatever, and they like that.
But there are a lot of reasons why business owners might be looking to partner quote unquote with another firm, but they don't want to sell, they still want to be able to own and control their company. But there are reasons for the companies to come together. There are synergies. That could be done.
Through some sort of joint venture, right? Where let's say there's an opportunity to get into a new market, to develop or co develop a product together based upon the technology that somebody has or and the other people have together. Maybe somebody has got the product, but somebody has actually got the distribution [00:04:00] and there's some sort of joint venture, or that could be structured as a marketing arrangement or a distribution arrangement.
But it could also be a strategic alliance of some sort. And by the way, strategic alliance is a very general term, even more so than joint venture. It can mean a lot of different things, but I wouldn't get hung up on what it's called. What I always say to clients and then, prospects and friends is listen, you as business owners and executives and key people want to think about where you are now, where you'd like to get to and how do you get there?
The way I would think about it, if I were you is. What is your business problem or opportunity that you're looking for? Oh, wait, you're looking to expand geographically because you want to expand your scope out of your local geographic area. Okay, great. Certainly you can go acquire a company in another geography, but you also might really just need them to, for their connections and local contacts and knowledge of the market.
So maybe you're going to do a deal with them. Where you're going to, and I'm not talking about like marketing companies where you hire [00:05:00] them and pay them. That's not, that's a contract, but, maybe they're an operating company, in your space and adjacent space, whatever.
And you're going to do some sort of joint venture strategic alliance or. Distribution deal or whatever it is to have them be able to serve or access that market that you wouldn't have otherwise been able to get into, but for some reason you don't, or maybe there's not an opportunity to, buy into that market by doing acquisition similar in terms of industries.
Somebody has access to a particular industry. And you can do a deal in which you leverage that access for your products. They're already selling into hospitals, right? With a particular product. You have another product. Okay. Maybe, and you, and there's so many ways you can structure that, right?
They can just get a fee for it. You can have joint ownership in an entity. You can give them a percentage of the sales or revenue. Million ways to do it, right? The way you want to think about these situations is what is the opportunity where you're looking to, maybe you're having trouble getting into that industry or [00:06:00] geography or expanding in various other ways or demographic.
It could be demographic, right? Younger customers or whatever it is. And that company has access to it. And you, for various reasons, or they have determined that, yeah, you don't want to do an acquisition. Maybe you don't have the capital to do that. Don't worry about how you structure it.
Just know. If you say, Hey, listen, we want to do something together in which we leverage this company's access to a particular market, geography, demographic, et cetera, we have a great product. They like that or service. How can we do something together? Come to somebody who knows how to put together deals like me or, anybody else that you have in your ecosystem who can help you figure out how to structure that.
But first figure out the business objectives of what you want to achieve. Licensing is another one. Okay. Many people have misconceptions about licensing. They know that there are certain areas of which licensing is done. So for example parallel, there's often brands that license, different [00:07:00] manufacturers create brands, they get the license to use the, brand name on, on those products, licensing is a phenomenal business. There's in many ways, there's not a lot of operations, right? If you're able to create a brand and license it out to other people you really just get to collect those licensing fees or royalties based upon the brand you created.
Now it's a lot of work to create that brand, to maintain the value of that brand, and obviously in your agreements with your licensees, You got to make sure that they're aligned with the brand and they're not doing anything to damage the brand. And there are all kinds of protections you put in those kinds of agreements that allow you to do that.
And then, there are things to figure out in terms of exclusivity or not, if it's exclusivity, there's usually certain minimums that they have to hit because you don't want to give somebody exclusivity and then they don't produce enough, enough revenue and not successful enough in ways exclusivity can be given up.
And what kind of support involved and, and it is deals with the various duties are, but there are, various other places where things [00:08:00] are licensed. Obviously, in the entertainment space is licensing deals done all the time.
I've talked often in the past about our speakers to often sell that time as opposed to licensing their content or give it away. They do a talk for client and the client then wants to take that, record it and use it over and over again and as opposed to structuring that as a license where they get paid for use for a year, let's say, and then it's got reupped if they want to continue to use it.
They'll either give it away or charge a one time fee, and that I think in my, in most cases is not the right deal structure for somebody who is a content creator, whether that's a speaker, whether that's a writer, whether that's, somebody who's doing courses, things like that if you're going to allow other people to use that and benefit from it often at least you want to look into whether there's licensing opportunity, whether you can structure a license deal.
And by the way, you can be on the other side of that. Maybe there's some technology or other things that it'd be helpful for you to license and I'm not talking about, we sign software licenses all the [00:09:00] time just to use any technology we do, but I'm talking about. I'm integrating that technology into your product or service in a way that could be much better than if you had to build it yourself.
Maybe you don't know how to build it yourself. Maybe it's the time to market, to build it yourself is going to be much too slow or the cost involved. So you let, so you license it and listen to license can be for a limited time, but you could also get a worldwide perpetual license, that goes on forever.
It depends upon what terms you can negotiate. So that's a deal we've had, guests on the podcast in the past. I remember one of the earliest episodes when it was still called fueling deals. I think it was in the first five episodes I had on Ramon Ray, who does a lot of sponsorship deals, where he's created a, I think he's also many influencers sometimes, and he's created a value in terms of the content he puts out and the conferences he puts on and he gets he gets companies to sponsor it.
There's a major corporate companies that, that sponsor, that's a deal and people think of sponsorship at conferences. And certainly that's pretty [00:10:00] typical. But or sponsored posts on social media, people have heard about it. They sometimes think that's only done by these young, influencers who are hawking makeup or clothing, but, those deals are done in various industries in various ways to be able to sponsor and, and leverage someone else's.
Brand or reputation of our audience or things like that. Let's take a break from the show for a minute. So I can tell you about an incredible resource. My team and I have put together for you secrets of deal driven growth, creative ways to grow your business. Even in challenging times is a powerful ebook that helps you take deal quest podcast episodes and apply them to your own life and business.
This is the ideal tool for anyone looking for creative ways to grow as deal makers. And you can get yours now. It's a Z. Corey Kupfer. com slash workbook and downloading your cup while you're there. You can also consider joining our dynamic deal driven community of founders, experts, [00:11:00] small business owners, and entrepreneurs.
Now back for the show, somewhat similar, a little different. There's all this affiliate deals. Speakers uses all the time. All online marketers use this all the time. Somebody who's got a book launch. So he's got a new course that they're doing online. Somebody's got a program that they're going to be doing in person and they have an affiliate deal with somebody.
Basically, if you're somebody comes up for, if you sell that for them or, introduce it to your audience and people decide to go to that event or sign up for that online course, you get a piece of the action. So that's, that's yet another type of deal. One of the things we talk about on this.
Podcasts also we have guests on is real estate deals. And the reason we do that is, is twofold. One, it's a type of deal, right? And even though if you're an entrepreneur, executive business leader, you may not be in the real estate business and regularly doing real estate deals, whether that's, we've had people on doing, whether it's raw land purchases to buying and selling buildings to syndications to flip, by buying flips, things like that [00:12:00] financing.
We've had folks on who who buy up on mortgages. But we, again, want to think about all these possibilities and maybe that's those things are something you want to do on your own, but also many business owners and executives and leaders have a lot of money.
Certainly the business owners, the entrepreneurs have a lot of their networks tied up in their own companies. And I think in the beginning, there's nothing wrong with that. I actually often quote I think I, yeah, I heard this from Harv Eker at one of his seminars years ago where he talked about how.
People talk about not having all your eggs in one basket and over time, certainly you want to diversify and be less dependent upon your business, for example. But you know what he said, and it was true if you study it, is that almost every super successful person actually had all their eggs in one basket at some point.
They just took very good care of that basket, right? It was only later that they diversified. Real estate investing. Whether it's at an individual, property level or syndicated level, fund level is a way for us entrepreneurs to diversify our investments [00:13:00] and be less dependent upon our own businesses or even, one sector or the stock market, things like that.
So we, we show that on the pockets as well. And I've done some real estate investing on my own. We put together, I had a couple of funds over the years and, then some other investing. Yeah. And it's, it's a good alternative way to do it. What's common in, in all of these and, listen, I, you're probably getting bored of me talking about the mindset of the deal maker, but that's what it does come down to.
Are you going to sit and try to grow your company only organically? And I say it over and over again, you need to get a customer and a client, get another one, unless you're the tiny fraction of a percentage of companies that's formed solely for the purposes of acquiring other companies.
But have you thought about all these other possible types of deals that I haven't mentioned? All of them, like I said, you could do distributed deals, you could do joint marketing deals, you can do anything that is not sales and marketing, and it's not like a sale, direct sale of your product or service but is another way to help you grow your [00:14:00] business over time, is this other category inorganic growth, deal driven growth that yeah.
For almost five years now, I've been preaching, as a, as an underutilized a way to do things. And, I think, and I've said this too, but I really am inviting all of you to think about this. Even if you have grown through deals, is it only M& A, is it only capital raising, is there only one or two types of deals that that you're currently doing?
Certainly, if you're not doing deals at all, start thinking about it, but even if you are doing deals, is there only. Are there other types of deals that you can do as well that will help you achieve your business objectives? Maybe, like I said, you're not able to acquire in a certain area, but you can do a joint venture, or you can, maybe it's not a full acquisition. You can do an early investment or you can do a licensing deal to start. And sometimes these other types of deals do lead to, getting to know each other, often, for example, a joint ventures, the clients. Is a stepping stone to a full acquisition or merger.
Not always but [00:15:00] sometimes it is because it's a way to you know, date before you get married as to, to use a maybe obvious analogy. Yeah, I, I think it's been a little while since I encouraged folks we say it on every podcast.
Or not everyone, but a lot of the podcasts that we, you know we, there's all these other types of deals, all of our materials this is, there's a general deals podcast purposely. But I think it's sometimes a good reminder and listen, we get so many new listeners as well, a good reminder to, to start thinking about that mindset about deal driven, driven growth generally.
And not worrying about all these terms I flew out or whatever. This is why you surround yourself with a great team, but know how to do these things, right? Because you may not realize that it's a licensing deal opportunity, or that it's a joint venture opportunity, or that it's a affiliate deal model, whatever it is.
And those of us who do this every day can help you structure it. All we need to know is where are you now, where do you want to be, what are the objectives, what the table? And if you have an idea on, at least an initial idea on the economic split, [00:16:00] the value.
The monetary value that he's just bringing then, we can take all that information and and suggest to you certain deal structures, certain types of deals that might be useful, and you can see what fits to the business objectives that you and the other party have. If you have any questions obviously reach out. There's so many great resources out there. But so many of them, there's such a bigger focus on M& A and capital raising that sometimes it overshadows these other types of deals. And sometimes the information, about these other types of deals get a little drowned out, by the M& A capital raising deals that are also obviously great opportunities and great deals, but they're just not the only ones out there.
So DealQuest community, listen. Just start thinking, opening your mind, broadening the opportunities two ways to look at it. As I alluded to, hey, what's the opportunity that you'd like to take advantage of that? You haven't fully been able to take advantage of it. And, let's talk about whether there's a deal that can help you do that.
And also, [00:17:00] what are your pain points, right? If your pain point is It's the inability to get into a market or your pain point is that maybe you have a weakness in your product and you can actually do a deal with someone else comes in and helps you with their technology, some sort of joint venture, streets and lines or licensing their technology, whatever it is, if you have a pain point that you haven't been able to solve organically.
Or even if you've solved it to some extent organically, but maybe, there's even more opportunity start thinking about other ways that you can get what what type of deal driven growth can help you bring your company even further to your objectives and help you grow in a way that makes sense for you until next week's folks.
Take, we take that lesson line until next week, folks. Have a great week and start thinking about those deals. You might be able to do that. You're not doing. Take care now. Thank you for [00:18:00] joining me on this episode of DealQuest, where we help you understand how deal driven growth can be your ticket to freedom.
I want to invite you to a unique way to tap into the wisdom and experience of the Deal Den is a place where entrepreneurs, high level executives, and business leaders come together, support each other's growth and success, and share what's working best, as well as what challenges we are facing right now.
You will get input, not only from me, But from all of our members, we collaborate and serve each other. To join us, go to CoreyKupfer. com slash DealDay. I'll see you there. I'm Corey Kupfer. Until next week, wishing you the freedom and financial prosperity that I know your DealQuest will bring.
