Ever wondered how to steer your business through the treacherous rapids of growth and financial management? This week, I'm joined by Chris Younger from Class VI Partners, who shares invaluable insights on navigating these challenges. Our discussion kicks off with a look into the firm's compelling backstory and how they emerged stronger from the pandemic's upheaval. Chris brings to light the critical role of entrepreneurship in the U.S. economy and the gaps in our education system that fail to ignite the entrepreneurial flame. We also dissect the unique hurdles family-owned businesses encounter, revealing strategies to improve business value and enhance the owner's lifestyle—all seasoned with anecdotes from my own entrepreneurial ventures.
Embarking on your own business adventure isn't just about the bright ideas and the breakthrough moments; it's also about facing the mountain of administrative work that can easily overshadow your day. Chris and I break down the hidden time sinks that can catch many novice entrepreneurs off guard, from the relentless flow of emails to the intricacies of introductions. We share the importance of a thorough understanding of your business and the sacrifices needed to fuel growth. This episode promises a no-holds-barred look at the grit required to reach the summit of success and the often overlooked blood, sweat, and tears that get you there.
As we draw the map from business expansion to the ultimate sale, Chris elucidates the pivotal role of investment banks in ensuring you receive the full value of your hard-won empire. We navigate through the complexities of the sale process, transitioning into wealth management, and the indispensable pre-transaction planning that safeguards and optimizes your wealth. Celebrating the entrepreneurial drive, especially among first-generation Americans, we also cast a light on the financial snares, like state tax planning, that can significantly influence your proceeds. For anyone with a side hustle burning to become the main event, this episode is your beacon to making that passion your profession.
As you're inspired to embark on your side hustle journey after listening to this episode, you might wonder where to start or how to make your vision a reality. With a team of experienced marketing professionals and a track recor
Ever wondered how to steer your business through the treacherous rapids of growth and financial management? This week, I'm joined by Chris Younger from Class VI Partners, who shares invaluable insights on navigating these challenges. Our discussion kicks off with a look into the firm's compelling backstory and how they emerged stronger from the pandemic's upheaval. Chris brings to light the critical role of entrepreneurship in the U.S. economy and the gaps in our education system that fail to ignite the entrepreneurial flame. We also dissect the unique hurdles family-owned businesses encounter, revealing strategies to improve business value and enhance the owner's lifestyle—all seasoned with anecdotes from my own entrepreneurial ventures.
Embarking on your own business adventure isn't just about the bright ideas and the breakthrough moments; it's also about facing the mountain of administrative work that can easily overshadow your day. Chris and I break down the hidden time sinks that can catch many novice entrepreneurs off guard, from the relentless flow of emails to the intricacies of introductions. We share the importance of a thorough understanding of your business and the sacrifices needed to fuel growth. This episode promises a no-holds-barred look at the grit required to reach the summit of success and the often overlooked blood, sweat, and tears that get you there.
As we draw the map from business expansion to the ultimate sale, Chris elucidates the pivotal role of investment banks in ensuring you receive the full value of your hard-won empire. We navigate through the complexities of the sale process, transitioning into wealth management, and the indispensable pre-transaction planning that safeguards and optimizes your wealth. Celebrating the entrepreneurial drive, especially among first-generation Americans, we also cast a light on the financial snares, like state tax planning, that can significantly influence your proceeds. For anyone with a side hustle burning to become the main event, this episode is your beacon to making that passion your profession.
As you're inspired to embark on your side hustle journey after listening to this episode, you might wonder where to start or how to make your vision a reality. With a team of experienced marketing professionals and a track recor
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Speaker 1:
Welcome to Side Hustle City and thanks for joining us. Our goal is to help you connect to real people who found success turning their side hustle into a main hustle, and we hope you can too. I'm Adam Kaler. I'm joined by Kyle Stevie, my co-host. Let's get started. All right guys. Welcome back to the Solid Hustle City podcast, Today's special guest, Chris Younger. Chris, welcome to the show. Thanks so much, Adam, Appreciate it. Yeah, so class, is it? Six partners? Is that what this is?
Speaker 2:
That is Yep, named after the most difficult rapids where you're going to need a guide or bad things are going to happen. I figured that was it?
Speaker 1:
I picked that up kind of from the website here. I really like how you guys integrated some of those visuals into the story and like use those metaphors.
Speaker 2:
It was really cool yeah we uh, uh, long story, but uh, during COVID my partner and I probably had too much to drink and came up with a new name, so we had, we had to had to rebrand.
Speaker 1:
Oh, you had to do some rebranding. Okay, well, hey say Classics Partners, pretty cool. So yeah, it's a tough, bumpy road. If you have a business and you want to sell it or you want to raise money, I mean anything in finance when it comes to having a business can be very difficult. And yeah, somebody who's been dealing with banks for years they can be a real pain in the butt. But you have to work with them. You have to sometimes raise capital in order to grow your business and hire people and do all that good stuff. So your company I mean we were talking earlier I mean you guys kind of do it all.
Speaker 2:
Well, we've focused on entrepreneurs the whole time family-owned businesses and we've really just tried to meet their needs as we've identified them, whether that's transaction needs or preparation needs, or managing money on the back end, finding growth capital or providing growth capital. It's a lot of fun, I like to say. Just like Warren Buffett, I tap dance into work every day because I get to work with entrepreneurs. So it's been a lot of fun.
Speaker 1:
That's my whole thing. I love it, man. So one of the reasons we started this podcast in the first place was because there was so much negativity around capitalism and business owners and I just couldn't stand it anymore and I said you know what these people are making an entire generation sad? And here we are in a country that I mean, there's no better place to be than the United States if you want to be an entrepreneur and if you're here. So many people don't take advantage of the opportunities that you have here. They just I think it's the school system. I think people just don't teach people how to start, that that it's even an option. You think you got to work a nine to five job, chris?
Speaker 2:
I totally agree. Our mission is to empower that entrepreneurial spirit, for exact reasons that you've identified, which is, you know, but for those entrepreneurs, willingness to take really outsized risks and put it all on the line, basically keep all the chips on red over and over and over again. You know, we don't have the country that we have, we don't have the economy that we have, we don't have the hiring that we have. It's just lots of benefits accrue from people's willingness to take those risks and really really put it all out there.
Speaker 1:
Yeah, and you, you say you work with mostly family businesses. What do you see? What? First of all? Why family businesses? And then what do you see consistently with family businesses? That they all, they all do wrong, maybe, and then maybe what they do right.
Speaker 2:
Well, I would say, by the time a business gets to us, right, so they've, they're past startup phase, they're in their growth phase. Sometimes it might be second or third generation, but by the time they've gotten to us they're clearly doing a lot of stuff right. They are, they've understood their market. They clearly understand their customers. They are likely differentiated in some way in their market.
Speaker 2:
Where we sometimes see businesses kind of run astray is when they're either focused on too many things. I think most entrepreneurs are very, very creative people. That's both an asset and potentially a liability. So just helping them narrow the focus a little bit and really dial in what they've got to get done in order to reach their goals, I think is pretty helpful. The second area where we see businesses, an area where we think they could benefit a great deal, is that business is just way too dependent on the owner. That owner is usually the top salesperson. They're the top innovator, maybe they run operations key to client service, whatever it is. The business is just way too dependent on them, and that not only makes for a tougher life for them, it also makes the business a lot less valuable, and so if they can fix that, not only will their life get a lot better. You know, sometimes that pressure to sell goes away because now they've got a business that's serving them instead of them being a slave to it.
Speaker 1:
Oh, that's, I'm telling you. I've I've had, you know, been involved in businesses that have sold to big companies. I was co-founder of a company that did that. I've, at the same time, been running an ad agency, which is essentially a lifestyle business for me. I'd love to grow it and sell it, but I'm in that world and I'm sure a lot of people are in the same world where it's like, hey, I could grow up, but where it's like, you know, I can kind of come and go as I want. You know, I'm making plenty of money at it, uh, but it's nobody's going to want to buy it because it's me.
Speaker 1:
It's really. It's really a uh, a glorified freelance business, and I'm sure you you get that all the time. I don't know how many agencies or digital businesses you work with, but that seems to be the case with a lot of people that I know as well.
Speaker 2:
No, we know your industry pretty well and that's exactly the case, right? And I think where entrepreneurs can make a mistake is not clarifying in their own mind what they want out of the business. Hey, there's nothing wrong with having a lifestyle business where you basically are working when you want. You're earning the amount of money that you want to earn. It's really working when you want. You're earning the amount of money that you want to earn. It's it's really working for you. Oftentimes, people grow because they think they have to grow and then they start to get stuck right Because if you're growing and you're not building that team, you're going to make yourself pretty miserable because there's going to be your. The number of hours in the day is not going to be able to keep up with the demands that the business has on you as an entrepreneur and that type of business.
Speaker 1:
Well, and how do you get over that hump? I've had several people that are accountants on the show that say you know, hey, I see the same stuff all the time from everybody. But I think from the entrepreneur's perspective, there's this thing where this fear of hiring people. You really can't grow the business unless you bring people. Now in my business I could maybe bring on another firm, maybe an offshore team, to do dev work or to do design work or something like that, but the administrative tasks start to pile up and you really need to work your way out of the day-to-day operations and really be the person who maybe sells the business. You've got to get processes in place. If you're going to sell your business, you have to have a machine.
Speaker 2:
Yep, it's got to be predictable, scalable. You know you got to de-risk it in a lot of ways in order to make it valuable. And we do an exercise with our clients we call it the 80 to 20 exercise where we really we ask our clients track your time for two or three weeks. Where are you spending your time? Oftentimes, just that exercise in and of itself is illuminating to them. But then we ask them to classify their activities into certain buckets and then have them rank it right, their activities into certain buckets, and then have them rank it right. Of the activities that you're doing, what do you enjoy the most? Let's keep those at the top of the list.
Speaker 2:
The activities that you don't enjoy, let's put those at the bottom of the list and let's figure out do we either get rid of them, meaning we're not going to do them, or do we find somebody to delegate those to? Who likes to do that kind of thing? Second thing we ask them is of those activities, what's adding the most value to the business? Because successful businesses run by an entrepreneur are successful for a reason. There is something that that entrepreneur is likely particularly good at. What happens as the business grows is they do less and less and less and less of that as the administrative burdens, you know, mount and they've got to divert their attention away. So that's another piece to look at. And then the final piece is hey, what is adding the most value to the business? Right? So what are the things you enjoy, what are the things that you're particularly good at and what's adding the most value to the business? Because if there's stuff that you're doing that's not adding a lot of value, let's get rid of those.
Speaker 2:
Once you do that exercise and you highlight, for that entrepreneur the 80-20 rule absolutely applies. 20% of their time is being spent on the highest value stuff that they enjoy the most and stuff that they're really good at. And our job is all right. How much more could you make as a business if we could get rid of just 20 or 30% of that, 80% of activities that you're not particularly enjoying? And it's once we do that a light bulb goes off and then they start to understand how you can make a business scalable, serve you better and just put you in a much better spot as an entrepreneur. But unfortunately, business owners, they're taking the trash out, they're cleaning up the kitchen, they're doing everything, and that time could be much better spent, and when that time is much better spent, that's going to be beneficial for the business, it's going to be beneficial for the entrepreneur and it's going to make the business more valuable.
Speaker 1:
Yeah, 100%. I mean you've got to have processes in place. I mean McDonald's is a process, right, like these, these businesses, all the franchises. As a matter of fact, I just spoke to a franchise expert yesterday. He's a broker and you know they there's I don't know thousands of franchises nine tenths of those, right and there'll be maybe a hundred that they'll even consider. And they have to interview you and find out, like, what do you like to do? What do you want to do? That? You know what's your experience Right? Have you been an executive before? Are you? You know, what is it that you like to do? Have you worked in a fast food restaurant before? Have you worked in a cleaning business before? So they want to find out what you actually enjoy doing the cleaning business before. So they want to find out what you actually enjoy doing, how much time you have to actually do that kind of stuff and really that process of trying to figure out what you want to do as a franchise. People don't even go through that before they start their own businesses.
Speaker 2:
Right, right. Well, a lot of times I interviewed a bunch of our clients during COVID and didn't have anything else to do because no deals were happening and was asking them about that story of when they started their business. And so many of those businesses were started because they got fired from a job and needed to do something or they just didn't want to work for somebody else. A lot of people believe there's this big master plan for a lot of these businesses and in fact, it just turns out that people are pursuing things that they want to do. And again, if you're doing those things that you like, odds are you're going to be pretty good at it, right, and odds are that it's going to add some value to your customers. And when you can maximize that time spent, that's really good for the business. And so when you, when you can do that and you can identify hey, we still have all these other activities that that add value to the business, well, let's go find somebody who's good at those, cause they're likely going to enjoy those.
Speaker 2:
My favorite example in my business we're we're regulated, we were regulated by the SEC and FINRA and compliance is it's. It's like paper cuts over and over again for me. Oh, it's the worst, oh, it's terrible. So, but there are people who love to do that. So the best day of you know, my job here was when we found a compliance person to take care of all that.
Speaker 1:
Oh my God, it was awesome. It was awesome, yes, yeah, oh, I would hate hate. I oh, I would hate hate. I mean, and that's one of those things people don't understand you, those are things you're never going to get your money back on, right, there's there's certain things.
Speaker 1:
The emails you send out every day you mentioned track your time. I mean, I always tell people look 15 minutes. Every single email you get is 15 minutes of your time At least. Like you've got to comprehend it. Read it and comprehend it, then come up with some way to send something back. I just got one today, an intro to some guy who's got an idea, probably wants investment money, and you know I had to read it Right and then I had to figure out what's going on. He sent me a deck. I'm looking at the deck. You know, and you know it's probably 20 minutes of my time today that I spent just looking at this guy's thing, that I wasn't expecting that email today, but there's 20 minutes of my day that I can't get back now.
Speaker 2:
Right, Yep, yep, and that happens over and over, and, over and over again, right, as a as an entrepreneur. And so just helping that entrepreneur get focused right and appreciate and understand where they're driving the most value and then just holding them accountable to that. Hey, you know we we talked about getting more time spent doing this. How's it going? Right? You know this, next two or three weeks, how are you doing? And again, if you can get people back into that flow zone for them, they're going to be in a much better spot.
Speaker 1:
Yeah Well, and people leave their company thinking and I've had this problem and tell me if you've heard this before from you, know me, the people in my industry and other industries. So I used to work with a lot of people in the ad agency world and they thought you know what I could leave charge with the ad agencies charging and I'll just you know. When they start adding things up in their head, they're like I'm just going to design logos all day, or I'm going to design websites all day, and they start adding it up and figuring out how much money they can make. And oh, eight hours a day I'll just be designing logos. No, no, no. Half of the day, if not more, is going to be administrative stuff. It's going to be going to networking events, it's going to be going to reading through emails. Like I said, it's going to be doing things you're never going to get paid for, even when you first start out, if two or three hours out of your day is even billable.
Speaker 2:
Well, think about the life cycle of cash in a business. You got to sell it, you got to deliver it, you got to collect it. Well, the selling and the collecting, that doesn't make any money, right, it's the delivery that's going to make you money. And, to your point, particularly right as you start to get busier. It's a big burden and it's not what people signed up for?
Speaker 1:
No, it's not In QuickBooks. I mean you got to understand how to be an accountant. I mean, when you're a solopreneur, you got to understand all these little roles and you probably don't have the money to hire somebody right away. Like you said, some of these people started their businesses when they got fired.
Speaker 2:
Exactly, exactly. They don't have that breadth of experience that's going to be necessary to run a business.
Speaker 1:
No, and they don't have the capital. And then, as you get going, say your business is successful, you've, you're making a decent living, you're able to survive on that. In order to grow the business, a lot of times you have to understand sales. You have to understand, or you bring in a salesperson and most salespeople don't want to jump in your business If uh, you know, if they're only going to get paid commission, everybody's like oh, I'm going to just hire a salesperson and pay them commission. Well, they don't want that. A lot of them want a salary and then a commission. And here you are, a little one person agency trying to grow or whatever. And and how do you do that? Right, there's always that.
Speaker 2:
There's that, that next level requires a skilled salesperson in a lot of companies in order to even grow Well, and that's why I think this is true for a lot of our clients who started their companies. You know there's a good two, three, four years where you're not making a bunch of money. You are reinvesting, you're putting the money back into the business to hire people, to fund working capital, and a lot of people don't understand that. I mean my business partner and I. When we started this business, we probably went three or four years without making any money. Yeah, Because you got to go sell it, you got to deliver it, you got to get deals closed. It takes a long time to do that and people I'm not sure people appreciate just kind of what kind of sacrifice that requires.
Speaker 1:
Oh no, they they discount that sacrifice all the time. Uh, they totally do, and I think they think that once your business is successful, everything you just got lucky or you know whatever excuse they want to tell themselves for them not doing it. But it's tough, it really is, and there's a lot of things you, you have to figure out and a lot of times people do that on their own and it's a shame, because I know there are resources out there to take companies from that beginning stage to where you guys start working with them. What are some resources or some things that, or maybe organizations or books that you've read that entrepreneurs can use, so they don't do the? I mean it's, every entrepreneur deals with the same thing.
Speaker 1:
It's crazy that nothing changes and it's like there is, there are patterns to these things and people think that it is unique to them. So don't they? I mean, it's, it's true. And what do you? What do you recommend for people? Is there something out there that people could read, like, if they're thinking about becoming an entrepreneur, to get to the stage where you're going to start working with them?
Speaker 2:
There's a great book out there called the E-Myth, which is all about how a business owner de-levers the business from themselves and uh, and it's a. It's a. I thought it was a great book on just how to think and conceptualize that.
Speaker 2:
The other organization that we're we're deeply involved with we've got four or five of our team as members as Vistage, which is a CEO kind of peer group, and I'm a big fan of peer groups, whether it's Vistage or YPO or any of the other ones industry peer groups because, to your point, every other entrepreneur is going through the same stuff and usually within that group of peers, somebody has been through exactly what you're going through and you know, as Charlie Munger used to say he's Warren Buffett's partner. He used to say you know, it's only the fools among us who learn solely from our own experience. You're much smarter, right, if you can learn from somebody else's failures and that's the benefit of interacting with other entrepreneurs and that's a great. Like I said, whether it's Vistage or another group there's several of them out there, but we highly recommend that.
Speaker 1:
Yeah, I mean I think there's a lot of people out there too that are hesitant to go to those types of groups like the B&I groups. And those are those are for earlier, I would say stage people to the B&I groups and then you know the, the vistages of the world, or when you're. I can't remember what the entry is for that, but it's a certain amount a million a year or something like that, in revenue. But yeah, there's some barrier to it. I know that. But the B&I groups are out there. I mean there could be some overlap. They're only allowed to have like one company in a certain kind of industry. But you're right. I mean there's chambers of commerce. You know there's probably multiple. There may be one in your county, there may be one in your city, there may be several cities around you that each have their own.
Speaker 2:
But it'd be a good idea when you're starting out just to get out there and let people know that you exist Well and find a mentor, find somebody who has been there and done it and is willing to spend some time with you. Be thoughtful about their time, don't abuse it. But having somebody who has already gone through what you're going through is very, very helpful, and one of the things that we do quite a bit with our clients is just network them with other successful entrepreneurs so that they can they just benefit from all that gray hair that those guys you know got, got the hard way.
Speaker 1:
And it's probably hilarious when these people come in and they ask these questions like it's just them that's dealing with it, and these guys, probably laughing inside, just don't want to say anything but really go like, oh my God, yeah, I didn't, I know, I know this story. Don't worry, I got you. I'll tell you exactly what to do. Well, explain your business a little bit, how it's structured, who you work with, who's your target. You know, who do you want to see come through the door?
Speaker 2:
Sure. So our business, it's a little complicated but we have and it's all designed around the entrepreneur. So we have an investment bank so that manages transactions on behalf of entrepreneurs. So when they're ready to sell, ready to raise capital, we'll tell their story to the market, manage that process, manage the negotiations, et cetera. Ahead of that or prior to that, we have a consulting group we call Pathfinder and that's really designed to get businesses ready in that year to five years before they're going to have a capital event.
Speaker 2:
We've got all kinds of experts on our staff.
Speaker 2:
We've got a Six Sigma Black Belt, we've got folks with expertise in sales, we have expertise in finance and we provide that to those entrepreneurs to help them make their businesses more scalable, more predictable and then more valuable.
Speaker 2:
Then on the back end, we have a family office, multifamily office, where we've got about 100 families that we work with. We manage about a billion dollars for them. They've all been through our investment bank or most of them have been through our investment bank. And then we've got a small fund where we provide some growth capital to some of those Pathfinder clients who would benefit from growth capital, and that's funded by growth capital to some of those Pathfinder clients who would benefit from growth capital, and that's funded by us and by some of our family office members. So it's we've really just tried, over the history 20 year history of our business really just to build services for the entrepreneur. That we've identified could add a lot of value to them and it's been a it's just been a great time. Identified could add a lot of value to them and it's been a.
Speaker 1:
It's just been a great time. Yeah, explain you we were talking before the show the different types of services you offer. I mean people don't really understand the difference between, like, what is a family office, what is a hedge fund, what is a. You know they don't understand the difference between those different kinds of groups. Explain some of the I guess pieces that you've integrated into your business and explain what those do.
Speaker 2:
Sure, sure, on the family office side, we're really. We manage money for them, so we'll help them invest in public securities and private securities. It's really designed to help them identify. All right, what are your priorities? What's important to you? What are your goals? What kind of timeframe are we talking about? All right, let's design an investment strategy that's going to dock up to that really nicely, and then we monitor that constantly. How are we doing? How are we measuring up? What are the challenges that we're having? How are we going to overcome those?
Speaker 2:
The investment bank is really. It's when, when a business is going to be sold. Our opinion is the best way to do that is you want as many buyers as you can get to the table. The more competition for that business, the better, and so that's what the investment bank does. We work with that business owner to develop their story. Then we take that story out to a curated list of potential buyers. That's custom right. Every, every client's different and then we tell the story, that client story, to those buyers and then solicit bids and then manage a deal process which is complex.
Speaker 2:
There's a lot that can go wrong. You know, we've been fortunate to do a lot of transactions, so I think we've seen most of the bad movies and you know we've been fortunate to do a lot of transactions. So I think we've seen most of the bad movies and you know, not quite sure, every once in a while I get surprised with another one. But and then the Pathfinder business is really just consulting. It is we. We sit with that entrepreneur, we analyze their business, we help them understand from a buyer's perspective. Hey, here's how a buyer is going to see your strategy, your team, your, you know your financials and here's what they're going to like and here's what they're not going to like. All right, let's talk about how we might change that story in the future such that your business is worth a lot more and that transaction is easier to execute.
Speaker 1:
Yeah, now, what I like about what you're talking about is you're helping people from early on all the way past their exit. So they exit, they have a nice little capital event. Now they've got money and when we sold our business it was a pretty large transaction. I didn't know what to do with this money. I had people calling me that I didn't even know Once they saw it in the paper and everything and the transaction amount. I had eight financial advisors calling me.
Speaker 1:
Oh yeah, people that I hadn't talked to in years were reaching out. I mean it was wild. Do you offer some? And this is important. People don't think about this, but you almost need protected from these people. And if, if you can work with somebody early on, like you guys, who make sure that you've got the legal stuff in place because I mean, you know, going out and finding people that can make sure that you don't get screwed over by this sell by one of these buyers is very important. And then, yep, you freak out like if you've never had money before and then all of a sudden, you get a check for a few million bucks, you're like whoa, like what do I do?
Speaker 2:
Yeah, I always look at our job. As for those entrepreneurs that have sold their business, our job is to make sure they never have to work again if they don't want to. Oh yeah, and and so, and I always tell entrepreneurs look, you've taken more financial risk in your life than most people will take in their entire lifetime, and so you know, a job on the on the wealth management side is really how do we reduce cost, reduce the tax burden and, you know, protect that money so that you, so that you do, don't have to work again. But it's, I will say, one of the reasons we started the family office I was talking about to this about today at lunch, was it's the whole wealth management industry is is not a great industry, um, and it there's a lot of conflicts, right?
Speaker 2:
So you know, you get a financial advisor who's got incentives to sell you certain products, whether that's insurance or their own funds or some managed fund, and those have a lot of fees, you know. So when we started ours, I, you know, I told our team. I said we're never going to take a dime from anybody other than the client, right, our fees are just to the client. That way there's never a conflict. You know if, if we recommend something to a client, it's because we believe it's the best product, not because, hey, we're getting the biggest commission from that product, and so, and the other piece, that another reason why we started it is because most of these entrepreneurs they're not attractive to a Goldman Sachs or a JP Morgan or a Morgan Stanley before they have their liquidity event.
Speaker 2:
They're obviously just like you mentioned. They're obviously very attractive after they get their money, but it's actually before the transaction when you can make stuff happen Tax planning, estate planning, planning for your kids and wealth which is a big topic that we deal with quite a bit, thinking about charitable giving, all of that stuff. There's a well, you're going to miss those opportunities, and so that's why we started. It was how do we, how do we help these entrepreneurs? Right, we respect what they're doing, but they're not getting a great level of service out there in the market.
Speaker 1:
Well, chris, I should have moved to another state two years before we sold. That's what I should have done. I should have got a uh, an apartment in Tennessee or something uh, because it would have been a lot cheaper than what I paid in state taxes if I would have moved to a no-tax state.
Speaker 2:
I didn't understand any of this stuff. It's funny that you mentioned that we had a client sold his business for quite a bit of money almost half a billion dollars and he I won't say the state that he lived in, but it cost him about 50 million in state taxes that he could have saved by moving a couple of years earlier.
Speaker 1:
Yeah, it was just- had to be in the coast, it had to be one of the coastal states.
Speaker 2:
Exactly, exactly. One of the big ones.
Speaker 1:
Yeah, oh, I bet, I bet they need a lot of money. They do. They've got a lot of things they want to support with, uh, with your money, uh, so, exactly, well, what do you? What do you see? Who's the average person Like? What would you? Because I think here's the problem A lot of young people don't want to start a business because they don't have any patients, right, they don't have patients for this stuff. The guys that are here selling these businesses the, the, the, the families that are selling these businesses these businesses have been around for generations or they've. If it's a person that just started it this year, it's probably a high growth business, but it could be an electrical contractor. They've been growing these businesses over the years. It takes time to do this right. It's not something that just happens overnight and people want everything overnight nowadays. Who usually comes in the door?
Speaker 2:
So our I mean our average transaction size for a sale is about 75 million. So these are businesses that are pretty mature. They've been around, you know, will do deals as small as 15 or 20 million, and then, obviously, this one we just did, which was a half a billion, the. These are businesses that are pretty well put together, but, to your point, you know, almost all these businesses are at least 20 years old, and that's why I always tell I think if you're starting a business and your principal goal is just to make money, that's going to be a big mistake for you, because it's going to be a while until you make serious money with a new business.
Speaker 2:
You need to love what you're doing, right, you need to really enjoy the work and you've got to be passionate about the work and about the mission and about your clients, because if that's not there, trust me, you're not going to have enough stamina to last until the business starts to make real money. And so it is a, you know, not just a patience game, but I think it's also just a priorities game. What? Why are we doing this Right? What's, what's the goal here? And if, if, the primary goal is just to make money, my guess is they're. They're probably going to fail. They're going to be unhappy.
Speaker 1:
Well, and you've seen enough of these. I mean, do you see, Well, and you've seen less and less people who are qualified to run a business for all the reasons you just gave?
Speaker 2:
Likely right. The, I think the I mean we could have a long conversation about hey, there are lots of factors that are making starting a business tougher in some regards and a lot of factors that are making it easier in some regards. Right At lunch, I was talking to this guy. We were talking about the impact of artificial intelligence and he was talking to a guy who used to run a newspaper. And the guy said you know, this newspaper had a staff of 80 to 100 people. And he said with AI and what's available, I could start that business today with three people and run it and be successful. So I think, on the one hand, with technology, we've made things a lot easier. With access to information, we've made things a lot easier.
Speaker 2:
On the other hand, I mean, as I talked about, I deal with a lot of regulatory hurdles and it seems like every year there's another one Right, and that could be from whether it's what we do on a regulatory front or it could be just hey, the state in which you operate decides. We're going to, we're going to change the regulations under which you operate, we're going to change your taxes, we're going to change the requirements to, actually, if you employ more than 50 people. Here's what we're going to put on you. It's that kind of stuff and sometimes I wish that more legislators understood what it takes to open, run and grow a business, and maybe then they'd have a little bit more. You know empathy for what business owners go through, but I mean, I've talked to a lot of business owners that you know where they basically just concluded. You know what. It's just too hard, so I'm not going to do this anymore.
Speaker 1:
Real sad. Yeah, it's ridiculous.
Speaker 2:
I mean it's like it's what's made this country great, that's right, and then you can.
Speaker 1:
You're going to have other places catching up with us and you know what the crazy thing is to me? It's like, you see, people I've got a lot of friends who are first generation Americans all entrepreneurs, they come over here and they kick butt.
Speaker 1:
Their dad, mom, came over here, broke their backs to give them a better life. A lot of times they were entrepreneurs too, you know, maybe weren't super successful, but they make sure their kids get a proper education, maybe send them to business school, and then those kids then become wildly successful entrepreneurs. I mean, Vivek Ramaswamy is from the West side over here in Cincinnati. He's a perfect example of somebody. Comes over here Jeff Bezos, Elon Musk, you know all these guys that they come over here, their parents. They set a really good example and they say look, take advantage of what you have in this country. We didn't have that same opportunity, Do it. Those are the people that are wildly successful. I'm sure you've met a bunch of them.
Speaker 2:
Oh for sure, For sure. A bunch of them. Oh for sure For sure. No, it's to the point. I feel like they appreciate what this country has to offer and appreciate the opportunities right, because I don't. Sometimes I feel like people don't understand just how fortunate we are in this country that you can start a business and you can be really successful if you're willing to put the work in.
Speaker 1:
Yeah, and how life-changing is this. I mean, what have? You can be really successful if you're willing to put the work in. Yeah, and how life changing is this? I mean? What have you seen? This transformation? If you could talk to young people right now and say, hey look, you can work until you're 65 years old or you can do this what would you say to them? I mean, it's to me. It's like the idea of working for someone else, making someone else rich until I'm 65 years old and then I leave with a gold watch. That's not exciting to me. I'd rather take the risk. I'd rather do something, not look back on my life someday and be like you know what I wish I would have done that.
Speaker 2:
Right, we all regret what we didn't do more than what we did do so over life. I think it's. It's interesting because a lot of times I'll have an entrepreneurament the persistence, the discipline, the willingness to put off a reward for a long time to really run a company. Usually how those conversations go is they think they want to be a business owner, but then when the reality hits that hey, by the way, you're on the hook for the loan, you're going to be the first person in and the last person to leave, you're the last person to get paid, right, if things aren't working, that realization strikes when a lot of people just say you know what, I'm not up for that. I want at least what they think is a more secure job. You know, I want.
Speaker 2:
I can't take that kind of risk and, and I think let's look everybody to each their own, but it is a for you and me. That would you know, that would kill us, right To to have to work for somebody else. And, uh, because, just because of the level of passion and commitment that we have, right, we want to, we want to go grow something, um, and, but not, not everybody wants to do that, and that's, that's fine. Um, I think it's just more identifying for you personally. Well, what do you want? Right, cause it's uh and that's the great thing about this country as well Right People get to do what they want.
Speaker 1:
That's right. You have the option. Nobody's telling you you can't do anything. So right, I mean look at this team you built on the website here. I mean you guys have. I mean this is not a couple people, this is. I mean you've got a significant and I'm looking at these folks and some of the credentials. I mean this is an impressive team of people that you got here.
Speaker 2:
I am one of the luckiest people alive to have the team that we have really really humbled, that they joined us, and I guess that I'm just really really lucky. We have an unbelievable team of people who are not just smart but they're hardworking, they're committed to clients, they're they're doing the right thing, they're collaborative. They work really well with each other. Um, it's, uh, it's what makes the job that I have, uh, you know, one of the best in the world.
Speaker 1:
It's amazing, and you get to uh be in Denver. Is that where you guys are at?
Speaker 2:
Is that where you guys are at, I get to be, yeah, yeah, absolutely 330 days of sunshine, adam.
Speaker 1:
I've been there a few times. One of my, one of my, our marketing director at the company we sold. He moved there and he started up a new company, an Airbnb kind of based company, and he was there for a long time and he just bounces around the country now and does whatever he wants, but he loved it. He's just because he's a runner, so every day he's just like oh yeah, just go out.
Speaker 2:
I mean, you know, every day it's beautiful practically. I mean a little cold sometimes, but sunny, you know, oh, it's, uh, uh, yeah, we like to keep up that facade right that it's a super cold in colorado. You know, you don't want, you don't want to move here, keep them out, keep them out.
Speaker 1:
we got that in cincinnati. We don't want people to know this is like, uh, it a big small city, right, but you know, I went to Miami University.
Speaker 2:
Oh, so you know you know all about the Cincinnati.
Speaker 1:
Yeah, I got six stitches right here at McCullough Hospital for yeah, getting into it at Miami University one time, two thirty in the morning I'm bleeding on their floor. It took about an hour for a surgeon to get there to tie me up but I had my problems back in the day. It is what it is, chris, I'm sure you've seen it too.
Speaker 1:
I really appreciate you being on the show. Tell people how they can reach out to you guys. If they fit the profile, if they're interested in maybe selling their business at some point, explain to people how they can reach out to you.
Speaker 2:
For sure. Our website is wwwclass6.com, and they can reach me at Chris at class6partnerscom as well, and you know we do a lot. We give a lot of advice away for free just because we want to help entrepreneurs, and so we're always happy to talk to an entrepreneur and see if we can be helpful.
Speaker 1:
Well, you've been doing it on this show, so I really appreciate it. Thanks so much.
Speaker 2:
Same to you, yeah, same to you.
Speaker 1:
I'm trying, man, I'm trying we got to get people out here, man. We got to boost the economy. Look at this GDP number. I mean it's sad Like we got debt. Debt to GDP. We got to get some more entrepreneurs in here, Absolutely A hundred percent. All right, Chris, I'll see you. All right, yeah, Take care. Thanks for joining us on this week's episode of Side Hustle City. Well, you've heard from our guests. Now let's hear from you. Join our community on Facebook, Side Hustle City. It's a group where people share ideas, share their inspirational stories and motivate each other to be successful and turn their side hustle into their main hustle. We'll see you there and we'll see you next week on the show, Thank you.
