Dealquest 295 - Solocast 66 - EDITED AUDIO
===
[00:00:00]
Corey Kupfer: Hey DealQuest community. This is a solo cast and, this is going to be a fun one. I, this is based upon a talk that I gave in Singapore. Actually, I did the same workshop, three times in Singapore at the EO, entrepreneurs organization, global leadership conference. And it's, it's something that, that now some other people want me to come and do at their various, chapters and it's, it's, an approach, that, I think is an interesting take.
On deal making, so I wanted to bring it to you guys, my podcast audience who don't get to attend, the, if you're not an entrepreneurs organization member, you're not in leadership, you don't get to go to Singapore. So far, you haven't been able to hear this. So I wanted to bring it here on this solo cast, so here's the concept. There are really two big things that I did. And, when I do this live, I do a lot of hot seats, so you won't get the benefit of that on the solo cast. But if, you do have an opportunity, to, come, whether it's in a neo event or and listen, I don't do a lot of promoting on this podcast, but you know, this is something that I do for various [00:01:00] organizations, I do it, you know, speaking in workshops and things like that.
So, if it appeals to you, and this organization you think would be useful for it, you can definitely let me know, but, you are going to get the concept of the value here, except, not the interaction, the hot seats and see how it plays out in real life, which is really helpful.
So the concepts really come down to two things. The first thing is this and, you know, you've heard me, if you listen to this podcast, you heard me talk about mindset all the time. Well, one of the things when I'm in a room of entrepreneurs, like at the global leadership conference in, in Singapore, or, you know, frankly, with.
You know, most of my clients who are entrepreneurs and business executives looking to grow companies. And you talk about the difference in the mindset between an employee and an entrepreneur. They get it right. They've either been employees previously and became entrepreneurs. That's true for most of us, although there are a few people I know who never worked for somebody in their entire life, most people did, or certainly, either way, if you are an entrepreneur and you have employees, which is what a true entrepreneur has as opposed to [00:02:00] somebody being self employed.
Then you also understand this difference in mentality. And you can spend, you know, if you speak to anybody who's not Shapiro, and you ask them about this, they can, we could probably have a conversation for hours. And there's also countless, I mean, hundreds, thousands of pages, online, articles, blogs, posts, distinctions.
About this conversation of the mindset of an entrepreneur versus the mindset of an employee, you know, and differences in terms of risk taking and willingness to put themselves on a line and, you know, desires, to sort of, create a vision and own something and build something and on and on and on and on, right?
And, so, that's sort of pretty accepted wisdom and if you research it, and in fact you know, this talk that I give, I do a slide. That shows the research when I put in, employee versus entrepreneurial mindset and how much comes up and how significant that is. However, as you've heard the podcast, there is another distinction in mindset, and that's the difference between an entrepreneur and a deal maker.
And there is a big difference between that, right? And one of the things I talk about in this workshop, and, folks, you know, this part of it may be more [00:03:00] familiar to my listeners. Then the second piece that I'm really going to talk about, the angle on that, but for many in the room, many entrepreneurs, they haven't really, really thought about this.
And what was interesting is in all three of the workshops I did in Singapore, it really resonated with people. You know, it was a revelation to some, made others think maybe they, had a little bit of a feeling of this, but it really crystallized, you know, for those who it wasn't a total revelation for, but it was really, really useful.
And that is this concept of that. There is this different mindset of a dealmaker. And that while you can grow a business organically and you can, do that very successfully and some people really do, and you don't have to ever do a deal. There is this opportunity for deal driven growth.
There is this opportunity to solve problems and to take advantage of opportunities with this additional set of tools, right? And you know, we've talked repeatedly that it's not just capitalizing in M& A, although that those are two big ones, but joint ventures, strategic alliances, licensing, all that kind of stuff.
Okay. Okay. Now, the interesting part, that I discovered, in putting together [00:04:00] my presentation for the Singapore workshop, is that, I did research. So, I said I did a search of entrepreneur versus employee mindset. Well, I did a search of entrepreneur versus dealmaker mindset. And this is the interesting part, whereas there's countless posts, articles, results that come up from searching employee versus entrepreneurial mindset, there's very little that comes up on dealmaker versus, versus entrepreneurial mindset.
In fact, a chunk of the stuff that comes up is actually the employee versus entrepreneurial mindset. Same, things that come up for that search come up in the entrepreneurial dealmaker mindset, search, which is not. You know, so those aren't really the right, aren't relevant to the entrepreneur versus dealmaker, mindset conversation.
And then out of something like, seven hits, in the initial search that were that showed up on the first page, that were dealmaker versus, entrepreneur mindset. They were six of them were mine. So there's only one piece of content that would not was not mine. And when I presented this at the workshops, I [00:05:00] said that I'm not saying this to say that, you know, Oh, look at me.
My joke actually was that. So either you are listening to somebody who's raving alone from the top of a mountain like a crazy person on something nobody else cares about, or maybe by the end of the workshop, you'll realize that this is an important and maybe underutilized, under thought about distinction that could really make a difference for you.
And my experience, fortunately, was, and people's feedback was that it really did. So it's interesting that this conversation is not. Out there in anywhere close to, I mean, not even the same universe. And it's barely out there compared to this, all those new materials on, on entrepreneur versus employee mindset.
So that was the first piece setting up that mindset. The second piece, which is, that first piece of your list of the podcast, you've heard in various ways, you know, on, when I asked guests about the dealmaker mindset and what they think about that difference and some of, pieces of my past solo guests.
Where I took that though in the workshop, I think it's very, very useful. And again, it resonated really, really well. [00:06:00] And that is, I had people in the workshop start out by sharing, by thinking about it and then sharing with a partner, their biggest, challenge, frustration, issue, or opportunity not fully taken advantage of in their business currently, right.
The biggest one or two. And you know, a lot of those, the things that came out of it were things that Probably predict, right. And might be experiencing yourself, whether it's a difficulty finding talent, right, hiring, whether it's, wanting to get into a new market and, and having challenges there, whether it's geographic or getting into a new industry or expanding a product line, you know, or, any of those kinds of things, right.
Or, you know, expanding sales, growing generally, all that, all of that. Right. And what I did was in the workshop is I, so that the sort of like, fun tugging and semi tongue in cheek, but really true, saying I had in the workshop was I said, listen, everybody's familiar with the phrase.
There's an app for that, right? You know, somebody needs some functionality, something [00:07:00] to be done. Well, there's an app for that. There's gotta be an app for that. And, that's become, sort of this go to phrase. Well, similarly, there's a deal for that, right? In the business context of dealing with a business frustration issue in your business, there's always a deal for that.
Does that mean that you should always do a deal for that? No, but it does mean that that is a possible and a whole bag of additional solution tools to any given business problem is there might be a deal for that. And in keeping with it, with the mind shift, mindset from being an entrepreneur, also being a deal maker.
If you come from the place of, there must be a deal for that, like there must be an app for that, then, it opens up your mind to say, okay, well, what type of deal might be, there be for that? And this is what we dealt with in the, you know, in the hot seats, right? So let me give you some examples, easiest one, right?
And one that a lot of people are dealing with now is, I'm having trouble finding talent, I'm having trouble hiring people. Well, let's think about [00:08:00] that. Sure. Should you, and can you, and should you continue to take organic, approaches to trying to, Hi, the best talent, whether that's through recruiting, paying recruiters online, post searches, you know, search boards, referral programs, maybe to pay, you know, your employees to refer people, whatever you do to try to find talent, organically.
Should you continue to do that? Sure. However, there might be a deal for that. In fact, there is a deal for that, right? There might be a deal for you for that. Well, there are, and I've mentioned this in the past, I mean, many, many of the acquisitions that we are doing now, at a higher percentage in recently, and this goes cyclically, right?
But because labor's tight, because especially qualified, talented people in various industries are tight, and also because Your best talent is actually often not looking for a job, right? And I'm not saying that there aren't people out there who are high quality, who are actually looking for a job, who have lost, you know, decided to leave because they were unhappy or lost their job because of downsizing or whatever, just cause [00:09:00] they're on the market doesn't mean they're not of high quality, that's for sure.
But as a ratio, as a percentage, the truth is a lot of the best performers are folks that are doing well you know, and are happy at their existing place. And you're not going to find them necessarily. I mean, some of the aggressive recruiters will do reach out to folks who aren't actually looking for a job, but they're not necessarily posting on job boards or going to job fairs or things like that.
Right. Well, and they might not be so interested in making a change individually, but if you acquired their company, now there's a lot you have to do when you do that to make sure people are happy, staying, not worried about their jobs and, you know, integrated into the culture. But if they could stay with their team, right, who may they, they may love working with.
And you can acquire not people individually, but sort of in mass, whether that's a few people or whether that's a big department. Then, you know, that is a, a way to jump forward in a talent search to be able to do that through an acquisition. Now it doesn't have to even be a full acquisition, it could [00:10:00] be what we call an acqui hire, we've talked about that on the podcast, from time to time, which is a deal into which you are bringing in talent, positioning out to the marketplace like it was an acquisition, but behind the scenes it really may not have been.
And that's most often a good for people who maybe are a few years into their entrepreneurship or self employment journey. And figure out that although they love what they do, everything else around running the business, making payroll, dealing with vendors, you know, you name it, right, is something that's a distraction from their passion and maybe they want to go back to it.
But, it's tough for somebody to say, Oh, you know, they probably made a big deal about them opening their own company, becoming an entrepreneur. And then just go back and say that they're going to take a job, is, you know, often difficult from an ego point of view, from a psychological point of view, from a presentation out to the marketplace and, or a family point of view.
So for them to say that they're a company was acquired or merged into. Your company and behind the scenes, you're doing a deal where they're employed and maybe they're getting a percentage of revenue or some other upside that ties them into the [00:11:00] performance, of their existing business or the growth thereof, then it can really make sense.
Often the, the people that make sense for also is on the other end of the spectrum. Somebody who's got that 15, 20, 30, you know, 25, 30 years in and they're tired, right? And maybe, you know, they've gone through the up and down cycles. Maybe the business is a little flat. Maybe it's not.
Because of the economy, but because they've lost some energy or whatever. And they also just want to be freed up from everything else they've got to do other than what they really love. And, at that stage of their life. So, that's a deal that's that kind of deal that aqua hire kind of deal is, you know, is a great way to get talent and pretty common.
The other thing is you can get access to talent without acquiring it or aqua hiring it. Through some sort of joint venture or strategic alliance, right? Or employee leasing deal, right? Sharing of employees. I mean, we didn't really do it at play leasing deal, but recently for my firm, we had one of our main associates who, took a step back for family reasons and we were growing and we needed to hire, and, and we're working on hiring another associate.
And, we reached out to our connections in our legal [00:12:00] circles, and one of the other entrepreneurs organization law firm, firms, in the country had, some, a couple of attorneys that had some excess capacity. And we did a deal to, you know, pay them a certain amount for, and get access to these talented attorneys, right?
So we did sort of, a, it's not technically an employee leasing arrangement, but a shared employment. Relationship or subcontract relationship is that they would call it in some other places or share talent, to serve our clients with qualified people who are vetted and, we knew the other firm owners and it made sense for them because it filled some excess capacity that they had.
So they pulled in some money, even if it wasn't at their full rates and we were able to make a profit margin on it. Right now, that was a temporary arrangement because we've since. And, you know, and that people come back, but you know, that is a deal, that we didn't have to go out and find our own talent.
We, we said who has that talent that we can access it. So that's an example, right? If your problem is that you've been trying to get into a new industry, right? You have a product that you think would be great in a [00:13:00] particular industry. I often say on this podcast, I ask who has access to that industry in your, you know, who you want to access.
Right. Because even if they don't sell it, you know, they still sell a totally different product. Well, if they have, if they're in, if the salespeople, the business development people, their relationship people, if even at maybe higher levels, right, their executive level, they have connections there, that's a way through a strategic alliance or joint venture, you can get access to it.
So the problem there is, hey, we've been trying to get into a new industry and you could try to sell into that industry organically. But maybe there's a deal for that, right? The deal for that could be a strategic alliance, joint venture, joint marketing, arrangement, or some sort of contract for them, you know, to referral in, for example, the, investment advisor space is what's traditionally be called referrals, solicitor related relationships, then they'll called the SEC is now, then they'll call it promoter relationships.
But whatever you call them in your industry, it's a way you can properly pay people to send you business. Right. For some industries, they call it channel partner [00:14:00] arrangements, right? And I've talked about those before. So, geography, that's another one, right? And I've talked about this, but again if, let's say you tried to open an office in a new city, because maybe you had one client there and you said, Oh, maybe we can expand there.
But for some reason, the sales efforts and the expansion efforts are not going well there. Well, maybe there's somebody local, right? Who has great knowledge who you can join venture with those strategic lives with or acquire. So the whole point is, and, you know, and again, in these workshops, we do it real time.
I mean, I don't pre prepare for whatever we run a mic. We have people say, this is what I have going on in my business. And I coach them one on one in front of an audience. And the great thing is, that even though that discussion, Is one on one fixing or helping or giving ideas to that particular entrepreneur on how there might be a deal for that on how they're, that there may be something else in this big toolbox that I'm very familiar with that may help them get through their frustration issue or problem in their business.
Other people who are listening [00:15:00] really get to say, Hey, that, how does that apply to me and they get value as well. So, for the purposes of this, solo cast, I won't continue down and give a thousand other examples, and there is something powerful about seeing it in real time, but I want to leave you with really, you know, two things when you're thinking about it for your own business, or if, you're speaking to, you're another kind of advisor, whether you're an accountant or a banker or insurance person or, other attorneys out there.
I know I have some fellow attorneys listening to this podcast, whoever it is. Two shifts. One, think about what it means to be a deal maker, not just an entrepreneur. And number two, right? Just keep that a little phrase. There's a deal for that and say, you know, or is there a deal for that? I think the answer is always yes. It doesn't mean that it's right for you, but you know, so maybe the better question is what deal is there for that?
But the point is, if you keep that mindset of that there's a deal for that, and you, even if you can't think of what that deal might be. Come and talk to somebody who is a deal person and [00:16:00] trust me, I mean, there wasn't a single person in any of these three workshops I did, right, in all the hot seat I did, hot seats I did, who raised an issue and some of them were very interesting and not, typical, where I could not think of a potential deal for them to do to solve, help solve that problem, move that forward, accelerate their growth, deal with that frustration or issue.
And that they, did not say either they're going to go do that or at least they're going to consider that as a possibility is one of the things that they can do to resolve that issue. So, folks, I'm gonna leave you with that this week, right? Have a deal maker's mindset. Ask or say, there must be a deal for that, and then help figure out which one that is to deal with, whatever business, frustration issue, et cetera you're having.
Identify those issues and let's figure out what deals there are that can help you solve them. Alright folks, have a great week. Take care.
