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June 27, 2022

Brad Franc On Why Succession Planning Today Has You Prosper Tomorrow (#137)

Brad Franc On Why Succession Planning Today Has You Prosper Tomorrow (#137)

"Believe in yourself, don't worry about what other people say" - Brad Franc

Brad is an entrepreneur, best-selling author, attorney, and CPA (inactive) with proven abilities in business, succession and strategic planning.  

Brad has successfully launched three separate companies, two of which were named eight separate times by INC magazine as the fastest growing companies in the United States.  The first company, Legal Network, Ltd., was the first legal interim staffing company in Western Pennsylvania.  Legal Network was subsequently acquired by a publicly held company.  Thereafter, Brad, along with three others, birthed PCN Network, a national real estate closing company. In May of 2014, Brad successfully sold PCN to a private equity firm. In 2010 Brad, launched his third company, Medallion Analytics Corporation which has received funding from both Innovation Works and two private venture capital funding sources.

In 2019, Brad created his fourth company, The Succession Coach, LLC. The Succession Coach is a consulting company that provides succession planning solutions for closely-held companies throughout the country. In that same year Brad published The Succession Solution, The Strategic Guide to Business Transition, an Amazon best seller. His book has been sold in over twelve different countries.

Brad is also a shareholder and director with the law firm of Houston Harbaugh, P.C. and has been with the firm for more than thirty years. He was the firm’s president and member of its executive committee for over fifteen years. He concentrates his legal practice in the areas of business planning, mergers and acquisitions, commercial transactions, federal and state tax issues, and succession planning.  Prior to attending law school, Brad was a Certified Public Accountant at EY & Company.

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The Succession Solution

Choose Your Own Roles: Realize Your Purpose Through The Roles You Live - Kindle edition by Franc, Bradley. Self-Help Kindle eBooks @

The Succession Solution: The Strategic Guide To Business Transition Kindle Edition

Preparing Heirs: Five Steps to a Successful Transition of Family Wealth and Values Hardcover – January 1, 2010 The Road Less Stupid: Advice from the Chairman of the Board eBook : Cunningham, Keith J.: Kindle Store

Bradley J. Franc - Attorney, Director and Shareholder - Houston Harbaugh | LinkedIn

The Obstacle Is the Way: The Timeless Art of Turning Trials into Triumph Kindle Edition

Find Your Why: A Practical Guide for Discovering Purpose for You and Your Team Kindle Edition

The Deep Wealth Sell My Business Podcast

Cockroach Startups: What You Need To Know To Succeed And Prosper

FREE Deep Wealth eBook on Why You Suck At Selling Your Business And What You Can Do About It (Today)

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This podcast is brought to you by Deep Wealth. 

Your liquidity event is the most important financial transaction of your life. You have one chance to get it right, and you better make it count. 

But unfortunately, up to 90% of liquidity events fail. Think about all that time, money and effort wasted. Of the "successful" liquidity events, most business owners leave 50% to over 100% of their deal value in the buyer's pocket and don't even know it.

Our founders said "no" to a 7-figure offer and "yes" to a 9-figure offer less than two years later. 

Don't become a statistic and make the fatal mistake of believing that the skills that built your business are the same ones for your liquidity event. 

After all, how can you master something you've never done before? 

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Enjoy the interview!


[00:00:00] Jeffrey Feldberg: Welcome to the Sell My Business Podcast. I'm your host Jeffrey Feldberg.

This podcast is brought to you by Deep Wealth and the 90-day Deep Wealth Experience.

Your liquidity event is the largest and most important financial transaction of your life.

But unfortunately, up to 90% of liquidity events fail. Think about all that time, money and effort wasted. Of the "successful" liquidity events, most business owners leave anywhere from 50% to over 100% of their deal value in the buyer's pocket and don't even know it.

I should know. I said no to a seven-figure offer and yes, to mastering the art and science of a liquidity event. Two years later, I said yes to a different buyer with a nine-figure offer.

Are you thinking about an exit or liquidity event?

If you believe that you either don't have the time or you'll prepare closer to your liquidity event, think again.

Don't become a statistic and make the fatal mistake of believing that the skills that built your business are the same ones for your liquidity event.

After all, how can you master something you've never done before?

Let the 90-day Deep Wealth Experience and our nine-step roadmap of preparation help you capture the maximum value for your liquidity event.

At the end of this episode, take a moment to hear from business owners, just like you, who went through the Deep Wealth Experience.

Brad Franc is an entrepreneur, bestselling author, attorney, and CPA with proven abilities in business, succession, and strategic planning. Brad has successfully launched three separate companies, two of which were named eight separate times by Inc magazine as the fastest-growing companies in the United States. The first company, Legal Networks Ltd. was the first legal interim staffing company in Western Pennsylvania. Legal Networks was subsequently acquired by a publicly held company.

Thereafter Brad, along with three others birthed PCN Network a national real estate closing company. In May of 2014, Brad successfully sold PCN to a private equity firm. In 2010, Brad launched his third company, Medallion AnalyticS-corporation, which received funding from both Innovation Works and two private venture capital funding sources.

In 2019, Brad created his fourth company The Succession Coach, LLC. The Succession Coach is a consulting company that provides succession planning solutions for closely held companies throughout the country. In that same year, Brad published The Succession Solution: The Strategic guide to business transition, an Amazon bestseller. His book has been sold in over 12 different countries. Brad is also a shareholder and director with a law firm of Houston Harbaugh PC and has been with the firm for more than 30 years.

He was the firm's president and a member of his executive committee for over 15 years. Brad concentrates his legal practice in the areas of business planning, mergers and acquisitions, commercial transactions, federal and state tax issues, and succession planning. Prior to attending law school, Brad was a certified public accountant at EY and company.

Welcome to The Sell My Business Podcast. And as usual, I have a terrific guest lined up for you today. We have a thought leader, author, a business owner, several liquidity events. You name it, he's done it. And we're privileged to have him with us today. We're going to have so much wisdom and insights that we're going to be sharing.

Welcome Brad it's an absolute pleasure to have you with us. There's always a story behind the story. What's your story? What got you to where you are today?

[00:03:52] Brad Franc: Well first, thank you. And it's great to be here. And I wish it was one thing Jeffery, and for many people it is, but my story is like many business owners. It's a story that covers 20 to 25 years of iteration, change, making mistakes, learning things that brought me here. So real quickly, if I may, I come out of college, I'm told I'm supposed to go work for a big eight accounting firm, be a CPA. That's the language of business. I start there. I realize I hate it. The only good thing that came out of there is I met my wife, who I'm still married to. Go to law school, come out law school and a friend of mine says, hey, I got this idea for a business. I said that's the craziest idea in the world, but because he's a friend of mine, we start. It's a failure the first two years. We lose money. We do some strategic planning, Jeffrey, and this is really an important moment. We start to implement strategic planning and things to start to take off. Fortunately, for me and my partner, the last three of the four years we owned the company, we made the Inc Big 500 fastest growing company. Three of the last four years, we get on the radar of a public health company and they want to buy it. There's a small subsidiary where we did real estate closings, and we said that wasn't for sale. And we took that company where we were doing about a hundred to 200 closings a month.

Ten years later, we made the Inc fastest-growing company five more times. And we were doing about 30,000 closings a month. Again, we did strategic planning every single quarter because it works so well. When we exited that, I was still practicing law, representing closely how business owners, seeing how they failed with either their exit, as you have so well identified in a number of your podcasts, they just don't know what they don't know or succession planning, so I developed a succession planning process. A 6-step process that'll help business owners go through and that's kinda how I came about to where I am today, providing consulting services to business owners, with respect to succession planning.

[00:06:13] Jeffrey Feldberg: Wow quite the story there and lots of curves and bends and everything else. But you got through. it. And I do want to do a deep dive on the succession planning because it's so integral and here at Deep Wealth, we just see what it looks like when you do it all wrong. And oftentimes it's too late at that point.

But before we get there, you shared with us the strategic planning that you did. And I assume it was it The Legal Network that was the first company

[00:06:38] Brad Franc: That's right. It was legal network that the funny, quick story is, as I said, we were losing money. A guy came in from out of town that did what we did and said, "Brad, You got an a A computer system, you got C space, you got D Sales, people! Get rid of your two partners. I'll go into business with you."

And I said it to my two partners and that was our call to action. And I said we have to do something different. And so we looked at various strategic planning processes, whether it was the Rockefeller Habits, EOS, Stephen Covey's Seven Habits and we started developing that process and we looked at each other, like, we're kind of, is this it's going to work, it's not going to work. But because we developed the plan and executed Jeffery, and that's so critical for business owners. That's how I think we found success. We focused on those important things and didn't get distracted over that shiny object that was flying in front of us at any one moment.

[00:07:35] Jeffrey Feldberg: And so let me quickly ask you that then, because when people hear the word, strategic planning and particularly business owners, if they're not in the corporate world, they're not at a Fortune 10 or fortune 100 or 500 Your strategic planning. It can mean so many things that many different people and oftentimes it's just these two fancy words on paper that as business owners, it goes over our head. So if we remove the words, strategic planning, and really got to the crux of what you were doing, and as you shared in your narrative, which is an exciting story to that you have, it it wasn't just the one-time, but it really sounds like it was at every step of the way you apply the same process.

So what's the process that you're doing with what you're calling strategic planning. What does that really mean of what, as a business owner, I should be doing?

[00:08:22] Brad Franc: Yeah, Jeffrey. That is such a great question. And I wish I could take credit for this. There's a terrific book called Down The Road, Less Stupid by Keith Cunningham. He really a terrific guy. He explains it this way, Look, he said. First, identify where you want to go. Second, identify where are you are then identify what's in your way. What are the obstacles? Because, if there were no obstacles, you would be there. Then, you build a machine to overcome those obstacles. You turn the machine on and you see how it works. And so, strategic planning is as simple as that. I believe you identify where you want to go.

You got to identify where you are. What's in your way. A great book is called: The Obstacle Is The Way and that's how we deal with life. We always have obstacles. Don't be afraid of them. Embrace them. In the strategic planning is, what are the steps we believe we need to take to overcome those obstacles. And I believe that's where your opportunities lie.

[00:09:27] Jeffrey Feldberg: I love that. And you just distilled that down into a form that really anybody can understand. Where do we want to be? What's getting in the way? Why aren't we there? And then what do we have to do? And when you say it like that, come on, listeners.

Does that sound that hard to you to do? And we put the word strategic planning back in. If that's what strategic planning is then really we should all be doing that anyway And then Brad, speaking of what we should all be doing anyway, two fancy words, succession planning.

And so again, let's just take that down to what that really means. I mean, succession planning, just in, regular words for our listeners, what are we really doing with that?

[00:10:04] Brad Franc: Yeah, another great question, Jeffrey. And I'm not just saying that because a lot of people use succession planning in all sorts of different ways. That doesn't mean it's wrong, but let me explain to you what I believe succession planning is for a business owner. And once again, this wasn't my idea. It was somebody else that I was speaking to and the business owner said there's three types of succession, and they come in this order. The transfer of knowledge, the transfer of management, and the transfer of ownership. So, in order for you to transfer your business, whether in a sale, whether none next generation of employees or family members, you first have to transfer the knowledge and skill.

You got to explain to that employee, how things work. Then you transfer management. You have to show them how to be a manager, how to be a leader, how to develop people. And then ultimately it's ownership because you know, one of the jokes I have Jeffrey, as Ben Franklin once said, The only two things certain in life are death and taxes.

My quote, the only three things certain life are death, taxes, and succession. They're going to take you out one way or the other, whether it's feet first, we're going to walk out. So succession is the transfer of knowledge, management, and ownership. And the business owner can pick and choose to many respects, which ones they want to do. But I believe first it's a knowledge and then possibly management and then ownership.

[00:11:30] Jeffrey Feldberg: And Brad what I love about that and for our listeners in the Deep Wealth community Really what you're talking about. We said the same thing at Deep Wealth, but in a different way. And what we talk about in our 9-step roadmap, step number two are what we call X-Factors that insanely increase the value of your business, your enterprise value, and a big X-Factor.

And this is the kind of question that when you say no to this it's don't pass go. Don't collect your $200. Stay in jail. Does your business run without you And that clearly is falling into your succession planning because you're talking about the knowledge and the management. And when your business doesn't run without you and listen, you've sold a number of companies and hopefully, we'll talk about that.

But as you know, if you're not running that business without you, if you don't have a team in place. You either have no deal or you're getting pennies on the dollar for that business so it's not a great situation. So Brad, when you walk in, you have your 6-step plan, you're working with a business owner.

They're completely not organized. They haven't done any of this before. Can you walk us through your system of what that looks like and where you're going to take us?

[00:12:39] Brad Franc: Yeah. And so if I make sure I understand your question, before I walk in, once they decide to engage me, there's a lot of due diligence that I do to understand a little bit about the business and I interview their important stakeholders on a somewhat confidential basis. What's important to you, do you think succession is important? What's your role? What you want to get out of this? So I get some flavor before I come into the meeting, but if you'd like me to explain the 6-steps, that's what I basically take business owners through. And I can explain the components of that.

[00:13:14] Jeffrey Feldberg: why don't we do both? Why don't you walk us through? So I'm a business owner we're talking for the first time. It sounds good. And you're saying, Hey, you know what, before I walk you through my process, let me do my due diligence on you so I can get to know your company. So what's going on there?

What are you doing? And how long does that typically?


[00:13:30] Brad Franc: Yeah. And so what's happening there is, if there's more than one owner, is there a shareholders agreement or isn't there a shareholders agreement? Does the company have a lot of debt? Doesn't have a lot of debt? To your point. Jeffrey, is there a management team in place? Is the owner the sole person? And if he or she gets hit by the proverbial bus, so does the company. If there is a difference of opinion as to hey the business owner wants to sell. The next generation doesn't want to sell, or the wife doesn't want to sell, or the husband doesn't want to sell. Is there alignment? I'm trying to understand from that perspective, you know, because of I'm a CPA, as well as a lawyer, I'll ask for the tax return.

And I'll look at some of the legal documents, more often than not Jeffery, what a business owner thinks, the organizational documents say, and what they actually say are fundamentally different. I tell people your estate plan is not your succession plan, but your estate plan can mess up a succession plan in a heartbeat.

So I have the skillset just because of all these years of experience of looking that stuff. So ask for the person's will. I've had situations where they thought that prop the business was going one way. In fact, the business was going another way and they're like, oh my goodness. Is that stuff that I will try to understand before we start the process.

[00:14:49] Jeffrey Feldberg: And so Brad let me ask you this. because you have probably seen it all on the not-great side and when things are really organized. So let's look at the not-great side. Someone is not organized. It's just all over. the map I'm going to guess. And again, I'm going to rely on my favorite Pareto's law, where probably 80% of the issues that you're seeing are really caused by 20% of certain factors that are either happening or not happening.

So what would be, as you look over the number of years that you've been doing this, what would be some of the most common reasons or issues that problems arise?

[00:15:24] Brad Franc: Okay. So I want to give you some really interesting statistics. And I've seen it, but there's another terrific book called Preparing Heirs. And these two gentlemen study 3,500 business owners worldwide and said, why did they fail? They did a research. Why did they fail? Remarkably, less than 15% of the time it was due to a technical or tax issue, 25% of the time, it was an ill-prepared, successor.

Your manager was incompetent or the next generation didn't know what they were doing, 60% of the time, it was a lack of communication and trust. No one knew what the plan was and they all had their own personal identities and ideas. My point to many business owners is that 85% of the time, it's within your control.

You know, preparing a successor right now, I'm working with a business owner. He thought his son was going to be the heir apparent and the board thought it was going to be the heir parent. And actually, the son was pretty darn good. What's happened Jeffery, he's 28 years old and has found love outside the city and has told dad, hey dad, I'd like to do it, but I'm not doing it.

Well, would you like to find that out sooner as opposed to later? And that's why we started the process. We asked the son to step up and he said time out. So now we're going to have a non-family member run the company. It's that if we didn't go through that process, Jeffery, we would never have found that out because we had asked the son.

So, I'd like to say it's some technical issue that I got the secret to, which, by the way, I have secrets to all sorts of tactical issues, but it really is communication and trust. What do I mean by trust? It's not that I don't trust you. Jeffery. If I lend you $20, it's Jeffery, will you have that report on my desk on Monday??

Absolutely. Absolutely. Absolutely. Monday comes along, where's Jeffrey? Oh, he's out golf. I can't rely on you. And so it causes great anxiety. Or dad says you're going to be in charge and then he tells that to somebody else as well. I can't trust dad because dad's trying to placate people. It's that kind of stuff that creates the problem.

[00:17:44] Jeffrey Feldberg: It's amazing. And completely off-topic. We're not going to go down this rabbit hole, but what we do in the name of love, it's just with that son and being the heir parent. And hey, thank you. But no, thank you. But that aside, but you bring up an interesting point because going back to the saying, what gets measured, what gets done.

This is really another application of that. So when you begin to really start the process of let's get transparent, what's happening here? Who's going to be doing what and checking in with all the stakeholders. You're finding out that that's the case. that's not the case. So that's. fascinating 85% of the failure rate are things that business owners it's a hundred percent in their control in terms of having that transparency of who's going to be the heir parent or not having their people prepare properly. That's just staggering when you think what's at stake and how that just doesn't go down the right way.

[00:18:34] Brad Franc: And if I can just add to that, Jeffery is what the authors then did and by the way, this statistic was 70% of you've heard this before 70% of the businesses were unable to transfer the wealth from one generation down to the next generation, whether it was wealth or business. Then they said, okay, if this is why they don't want. What about the 30% that got it, right? What are they doing to get it right? And it was interesting and I know it sounds self-serving but they said they developed a process to have open communication and explain and identify what the plan was. So they had a process and they document the process about, what gets measured, gets improved.

And the takeaway is, yeah, there's all sorts of problems that can sink the ship but don't forget about the solution

[00:19:25] Jeffrey Feldberg: and Brad what I love about that. And again, we're saying the exact same thing just in different. ways. Let me go back to step two of the 9-step roadmap, X-Factors. And this time another X-Factor that we have in Deep Wealth, we call it the four points of clarity. And in the four points of clarity, we have all kinds of things such as the business running without you. Things like if you're abdicating too much in terms of responsibility or not. KPIs, but one of the things that we also have is transparency and communication transparency. In this case, in a succession plan, everyone knows what everyone else is going to be doing. So that really goes also back to culture and another, X-Factors just having a transparent culture where there's trust.

Going back to what you were saying earlier. So you shared with us what the 30% who got it right. It was at planning process and having that transparency that really had them cross the finish line. And you've outlined what doesn't work in some of the things that now do work. Is there anything else that you're doing in your diligence process before you onboard a client?

[00:20:28] Brad Franc: No, I can't say that there is much more than we start the process because I think the real value is actually going through the process and executing. I quote that I like is a plan without execution is nothing but a dream. An execution without a plan is just passing time. And so, no we sort of get into it because I think that's where the value is generated.

[00:20:54] Jeffrey Feldberg: and I'm going to ask the obvious question. it probably is not so obvious of an answer, but I know those listeners out there that are. saying Brad, you sound like a terrific guy. You have a wonderful story. The 6-step process and doing this diligence ahead of time, but I'm flat out. I just don't have the time to do this.

I will get to it. Another day, 10 years from now, five years from now, when I'm thinking about retiring and it's more relevant. What would you say to that listener?

[00:21:21] Brad Franc: So, of course, I keep quoting books and I apologize for that, but what's Dwight Eisenhower that said, oftentimes the urgent is not important and the important is not urgent. And you've got to be able to find that time, which I would suggest to you Jeffrey, it's not that hard if you plan in advance to take a half-day, a full day, once a quarter, I basically say to a business owner that will meet once a quarter for a day. And if you can't do that four times throughout the year, don't engage me because if they are so busy and I don't mean this in a disrespectful way, if they can't find that time to work on their business versus in their business, then I don't think they have a business. It gets back to your point is you have to do it all. So yeah, I understand that. And some people say I got to put it off and that's okay. And I had one business owner telling me he asked me to explain his purpose with his board member, former CFO.

 The former CFO said this is crazy. This will never work. I said that's fine. Don't hire me. A year later, the business owners. said you got to come back, we need your help. So, sometimes it just takes people to, you know, until their hair's on fire to make a decision to proceed. Jeffrey, I appreciate what you're saying and it does happen.

[00:22:39] Jeffrey Feldberg: And then let's talk about, another factor, and let's really get real now because talk about a liquidity event and liquidity event Brad as you know. This is where up to 90% of liquidity events fail. This is where business owners are leaving anywhere from 50% to over a hundred percent of the deal value in the buyer's pocket.

And they don't even know it, but let's take the positive of that, that somehow a business owner, maybe they've done the 90-day Deep Wealth Experience. They're now incredibly successful when they haven't done the succession planning properly. Let's go where it counts the wallet. What are some of the nightmare situations that you've seen from a money side, or maybe there's been tax implications?

You knocked it out of the park with a liquidity event. You should have won, but you actually lost on some of the technical things that came afterward. What does that look like? What should we be aware of?

[00:23:31] Brad Franc: Yeah, Jeffrey, to your point. So I'm proud to say actually today, we closed an event, we had a liquidity event. The business owner sent me the nicest thank you. Even though I sent him a big bill, he said, Brad, if you want me to put anything on LinkedIn post it, I can't thank you enough for what you taught me.

To go back a year ago, when he was thinking about a liquidity event, I said to him, his name was Bob. Do you know how much you need to retire? He says, what do you mean? I said you better find out because you get a nice salary from this because he had received an offer Jeffrey a year ago, which he thought was a lot of money. He came back to me after he met with this financial advisor and said, I can't sell this company for what they're want to buy it from me. And so then we went through a process. He actually ended up selling it for twice the amount. It sounds like he listened to your podcast. Twice the amount. He's happy. And so we didn't have an oops, we made a mistake. Contrary to that, there was a situation where a business owner came to me when he was ready to sell. And he was a C-corporation. It's very expensive to sell your company as a C-corporation, we should have elected to be an S-corporation, could have saved him probably 30 to 40% of the purchase price.

[00:24:51] Jeffrey Feldberg: Wow, 30 to 40% of the purchase price over the type of company of an S Corp over a C Corp. Wow.

[00:24:58] Brad Franc: There was no reason for him to be a C-corporation. He just hadn't gotten good advice early on. And it sets silly stuff that you hate to tell somebody it's too late. We're too far down the path. If you would come to me earlier, we could have done something about, but those are the types of things that you see that are involved and you know, poor plan.

[00:25:22] Jeffrey Feldberg: Unbelievable. you hear these things and you know what, a liquidity event. I often remind business owners. It's not how much you quote-unquote get for the liquidity event. It's how much you keep when all of a sudden done after you have your fees and more importantly, your taxes and everything else it's, what's leftover and going back to Bob, your client, I don't even want to think about what that would have been like, had he sold this company.

You know, the largest, most important financial decision of a lifetime the first time around only to find out he has to go back to work, maybe get a job because he can't support himself on what he got. He didn't do that kind of planning. So it's incredible what you're sharing of, how that preparation upfront really, it's a rounding error for the time and money spent, even with your big bills relative to the ROI that you're getting when all of said and done.

[00:26:14] Brad Franc: Jeffrey, if there's, again, I know, you know this stuff and you talk about it. What I tell clients when they're thinking about selling their business, if that's where we end up with our succession plan and oftentimes we do, what's the net number, because there might be an investment banker fee, there's accounting fees, there's legal fees and there's taxes and the most recent situation was telling me, oh no. It's all going to be capital gain which is a much more favorable tax rate. But he had lots and lots of equipment that he had depreciated what the guy that was advising and didn't realize is that equipment is recaptured at the ordinary income tax rates. And his number was millions of dollars less than his net number. Then he realized, right, but because he was with his golf buddy and his golf buddy, so it's all capital gain. It's not right. This is why it takes a little bit of work ahead of time to determine your net number.

[00:27:09] Jeffrey Feldberg: Yeah. Wow. I mean, we're really getting into the weeds and some technical stuff, but let's continue along that. I'll throw a few other concepts out there and maybe we go down one of them or all of them When it comes to succession planning, other things that come to mind and let's really keep in mind, Brad here at Deep Wealth, we're really all about a liquidity event that at one point in time down the road, it could be a year from now.

It could be 10 years from now. You know, you're going to have a liquidity venture. You're going to have some sales of the business. How do you factor that in when it comes to things like a power of attorney, which I'm sure most business owners would never even think of, or nepotism, if you do have family in the business, how do you deal with that? And how does that look to even having a board of advisors? So I know I'm just pouring all these different concepts out there, but we'd love to hear your thoughts in terms of how you deal with that. What are your thoughts on those kinds of topics in the succession planning?

[00:28:04] Brad Franc: See, these are the things that people don't realize and think about and you have to bring them up. What I try to tell people, Jeffrey is my job is to educate, you make the executive decision. I tell people if I can't explain something that you don't understand, I'm either lying to you or I don't know what I'm talking about.

It's that kind of stuff. So I am a big fan of a board of advisors or a board of directors. Because people, the old saying fish discover water last. Some people don't realize something that may be happening that another smart business owner advisor can assist them with some of big fan of board of advisors, a board directors, and also gives the business owner cover when little Johnny, a little Susie says, why am I not making a $100,000 or $500,000 a year dad?

And you say well, I have a compensation committee on my board of advisors. They'll tell me what the right number is. And so you can give yourself a little bit of cover there. Power of attorney is another good one. If a business owner becomes incapacitated and that stuff can happen, and I'm not trying to be disrespectful here.

Oftentimes the power of attorney goes to the spouse. Maybe the spouse knows nothing about the business and doesn't know what to do. But just as importantly, early in my career at a business owner, he had a sign company fell off the cherry-picker was in a coma. And I write about this in the book. There were no documents.

He had no power of attorney. His wife couldn't act on his behalf. He lost a business. She couldn't write a check because it would take two to three months to have him declared incapacitated. So that's really With respect to family members and I don't just work with family businesses, but when you're transferring a business down to the next generation, oftentimes there's a bank involved.

Or most business owners have lending facilities. Most banks want personal guarantees. So is dad or mom going to transfer the business down into the next generation? Who's in control of this? Are dad and mom are still personally liable for the debts of the company? You just have to ask yourself, do you really feel uncomfortable with this kid running the company?

Those are some of the dynamics that you just have to talk about because most business owners forget about personal guarantees to the bank.

[00:30:20] Jeffrey Feldberg: And you know, what, as a business owner, and you're thinking about having a liquidity. event You may drop the ball in the areas that we're speaking about, but you better believe that your future buyer will not. And they're going to have their 400, 500 plus point due diligence checklist, and that's going to be one of the items.

And now this becomes potentially a skeleton in the closet and it gives them leverage to have that dreaded E word that we ban at Deep Wealth, otherwise known as an earn-out. They may want to increase the escrow and all those other nasty things. And so Brad, just the few small examples, and I know those are a few of many examples that you could share with us in those few instances, it just makes the world of difference of the preparation that you're doing here today.

And upfront And that preparation is the gift that keeps on giving for many years down the road. Maybe in some cases, decades, if it's going to be a family business and there's going to be from one generation to the next. Now, Brad, you've been successful in so many areas, but you're also an author of a couple of books that, are really making a difference out there.

And I'm gonna put the books in the show notes for our listeners. It'll be a point and click. Choose Your Own roles and the other one, The Succession Solutions. What can you share with us about the books that you have and why that may be of an interest for our listeners to read?

[00:31:37] Brad Franc: Choose Your Own Roles was the first book I wrote. Thank you for mentioning that. And I do, as you probably figure, I do a lot of reading and I said to my wife one day, I think I could write one of these books and of course, what does a good spouse do, sure you could! Why don't you give it a try?!

And I said, you know, if only two people read this book I'll be happy. My son and daughter. And it's all about, we all choose our roles in life as a father, as a son, as a brother. And how you live those roles. How you choose those roles and live those roles really define who you become. And I wrote it and my daughter came downstairs after reading it and said, Dad, I hear your voice in this book.

I thought that was really cool. And so it's all about personal development then that's what, Choose Your Roles. The Succession Solution, as the subtitle goes, The Strategic Guide, you get that one, the Strategic Guide To Business Transition. So the book is really two books in one, Jeffrey. One is what succession planning is. What the problems are, the traps for the unwary, the things to think about. And the second part is my process. I tell people, you don't have to use my process. Use a process, but keep in mind the issues that I address in the book at the front part, the statistics I just mentioned, and some of the other scary things that you can run into. Personal guarantees, wills that are improperly designed change of control provisions. When there's a change of ownership, a contract can be terminated. Those types of things.

[00:33:07] Jeffrey Feldberg: Well, congratulations on both books, and for the first book, The Change of Roles, what I love about. that it's creating a legacy for yourself of your voice, for your children, for your grandchildren, for your great-grandchildren down the road.

And I love that you thought about that because really in a very direct way, it tells me a lot about how you think Brad. And our businesses and our future liquidity event. isn't that also setting up a legacy for our children and grandchildren and great-grandchildren when we do it right in particular?

And, there's only one side to be on and that's the winning side. No one wants to be on the losing side and we want to make sure that we get. it right. And through the preparation, the strategic planning, the succession planning that you bring to the table is something that really helps to get us there. And so if we zoomed out and we're now doing a 50,000 foot in the air overview of your process of succession planning, what you've seen over the years, what you've learned over the years when it comes to these really important topics that we've discussed so far, are there any key takeaways that you can share for our listeners

[00:34:09] Brad Franc: Yeah. I think it's obvious, but it's important to state. So I break it down into six categories. The first category I call the purpose category. The first thing I talk about in that category is, what are the core principles? What are the values that are important to you? Because this gets back to Jeffery your comment about culture.

I think when you define your values and principles, you're defining your culture, and Jeffery, as you might imagine, during the succession planning process, there will be disagreements. And when there is, we go back to, what did we say was important. Whether it's increasing the value, whether it's transparency, whether it's respect for others.

What's the ultimate vision? Where are we trying to get to? In the Bible, it says if there is no vision people perish and then to your next point is why? Okay. We have our values. We know what our vision is. Why do we have it?

You have to explain to me a great book is Getting the Why by Simon Sinek. Once you got to get that. Now you've got the business owner, I think, motivated. They've got the jet fuel to move forward. The next category is the discovery stage. Where are we? I talked about Keith Cunningham and then the next step is a SWOT analysis, but it's not a SWOT analysis. It's, the threats what's preventing us from getting there? What are our strengths? What are our opportunities? And what happens if we don't do anything? Nothing motivates people like fear. This is what it's gonna look like. And then I say, okay, if this is where we want to head to, this is our core values. This is where we are. These are the rest, you start with the mission stage. Bill Gates once said, most people overestimate what they can do in a year. They underestimate what they can do in 10. So I said, look, we're not in any rush here. We're going to be sitting here three years from today. What would you like to see have happen with your succession?

We listed that, then we take it to one year, and then this is the next step is where all of the action occurs. Another great book, The 12-week Year. The author talks about we should all plan our lives around 12 weeks. It's long enough to get stuff done, but short enough to keep our eye on the ball. And so I say to the business owner, all right, this is what we said, we're going to do at three years.

This is what we're going to set in one year. What are we going to do over the next 90 days to get ourself closure? And then we set a date. We meet again. It's remarkable Jeffrey, you talk about what gets measured, gets improved. If you want to prove something measure it, if you want to improve something exponentially measure it and then report out on it.

So when someone has to show up at a meeting and say, here's what I did all of a sudden, like two or three weeks beforehand, they get their stuff done.

[00:36:40] Jeffrey Feldberg: The accountability factor. It is so huge. And I just love what you're sharing, because again, you're taking these fancy complex, hard-to-understand words. And you really you're giving actionable items very easy to understand. You've put together the system and Brad, I know that your system isn't just for business owners, that you can also help advisors that are out there who may be already into estate planning or succession planning, and for our community who aren't just business owners, they're also all kinds of advisors.

Why don't you talk to them for just a moment about what you're offering them, of how they can come in learn your system get certified, and do all these incredible things that you're doing.

[00:37:19] Brad Franc: Thank you Jeffrey for bringing that up. There's only one, Brad Franc, my wife thanks the world, there's only one Brand Franc. If we don't need any more of them, but I said, how can I take this to another level? How can I help other people? How can I spread this other to business owners?

And so during COVID. I developed a training program of nine modules, about 40 minutes, a long training program, training book, specifically designed for other advisors. They should have at least five years of business whether it's business council, whether it's CPAs, lawyers, financial advisors, planners. They go through my process and they become a certified succession solution advisor. If they want my assistance with clients, they can, but there's no obligation, no continued obligation, but it's a way for me to train other advisors so they can help their clients. Because I tell people in this course that you know, number one, it does generate additional revenue for the advisor, but you become much closer to the client and you're helping the client learn things that they otherwise wouldn't learn.

And the advisor learns things about the client that they otherwise wouldn't know, and it helps avoid mistakes. It is a program that I have online and anybody can sign up and do the program.

[00:38:33] Jeffrey Feldberg: And for our listeners and advisors, in particular, we'll put all of this in the show notes. So it will be a Point and click for you and you can get that information and get that going. Well, you know, we're at the point, Brad, where I get to ask my favorite question and I know offline, you're sharing you listen to a few episodes, so you have a little bit of a tactical advantage here, but we're going to do it anyway because I'm curious about your wisdom and how you're going to answer this.

And so the question is this. When you think of the movie Back To The Future imagine that DeLorean Car that can take you to any point in time. So Brad it's tomorrow morning. You look at outside your window, the DeLorean car is there. The door is open and it's waiting for you to hop on in, and you can go to any point in your life, Brad, as a child or a teenager, a young adult, whatever point in time it would be.

Brad, what are you telling your younger self in terms of hey, here's some life wisdom, or here's some things that you shouldn't be doing, or here's some things that you should be doing. Does that look like for you?

[00:39:32] Brad Franc: Yeah. Not to get too serious for a moment, but it would be when I was 17 years old, thinking about going to college and my parents separated and I went to my father and I said, hey, I want to go to college. And he said I don't think you're the college type. And it was a kick in the gut. And I would tell myself, believe in yourself, don't worry about what other people say and that would be the message that I have tried to live by is look feedback's great but believe in yourself. And if you've got a dream you want to pursue, pursue it and you'll develop along the way. I heard the other day. I asked my God to make me stronger and He gave me a bunch of challenges to make me stronger.

[00:40:13] Jeffrey Feldberg: It's such good advice. And I think a terrific takeaway that all of us can begin deploying today for us. Believe in yourself that you can do it and listen, everyone has an opinion, and good for them But let's just believe in ourself and follow our own North Star.

[00:40:28] Brad Franc: Yeah.

[00:40:29] Jeffrey Feldberg: So wonderful advice. Brad, as we wrap up this episode if someone would like to find you online, what would be the best place

[00:40:37] Brad Franc: Yeah they certainly just Google my name and they'll find it hopefully, and is my website and there's contact information and I'm on LinkedIn. So I enjoy helping other professionals, just like you do Jeffrey.

You've been very helpful for me just when we first met. So I want to thank you for the time and again, they can reach out to me when they want.

[00:41:01] Jeffrey Feldberg: Terrific. Really appreciate that. Well, Brad, thank you for taking part of your day and spending it with us here on the, Sell My Business Podcast. And as always, please stay healthy and safe.

[00:41:10] Brad Franc: Thank you.


[00:41:10] Sharon S.: The Deep Wealth Experience was definitely a game-changer for me.

[00:41:14] Lyn M.: This course is one of the best investments you will ever make because you will get an ROI of a hundred times that. Anybody who doesn't go through it will lose millions.

[00:41:24] Kam H.: If you don't have time for this program, you'll never have time for a successful liquidity

[00:41:28] Sharon S.: It was the best value of any business course I've ever taken. The money was very well spent.

[00:41:35] Lyn M.: Compared to when we first began, today I feel better prepared, but in some respects, may be less prepared, not because of the course, but because the course brought to light so many things that I thought we were on top of that we need to fix.

[00:41:50] Kam H.: I 100% believe there's never a great time for a business owner to allocate extra hours into his or her week or day. So it's an investment that will yield results today. I thought I will reap the benefit of this program in three to five years down the road. But as soon as I stepped forward into the program, my mind changed immediately.

[00:42:12] Sharon S.: There was so much value in the experience that the time I invested paid back so much for the energy that was expended.

[00:42:23] Lyn M.: The Deep Wealth Experience compared to other programs is the top. What we learned is very practical. Sometimes you learn stuff that it's great to learn, but you never use it. The stuff we learned from Deep Wealth Experience, I believe it's going to benefit us a boatload.

[00:42:36] Kam H.: I've done an executive MBA. I've worked for billion-dollar companies before. I've worked for smaller companies before I started my business. I've been running my business successfully now for getting close to a decade. We're on a growth trajectory. Reflecting back on the Deep Wealth, I knew less than 10% what I know now, maybe close to 1% even.

[00:42:55] Sharon S.: Hands down the best program in which I've ever participated. And we've done a lot of different things over the years. We've been in other mastermind groups, gone to many seminars, workshops, conferences, retreats, read books. This was so different. I haven't had an experience that's anything close to this in all the years that we've been at this.

It's five-star, A-plus.

[00:43:21] Kam H.: I would highly recommend it to any super busy business owner out there.

Deep Wealth is an accurate name for it. This program leads to deeper wealth and happier wealth, not just deeper wealth. I don't think there's a dollar value that could be associated with such an experience and knowledge that could be applied today and forever.

[00:43:40] Jeffrey Feldberg: Are you leaving millions on the table?

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Your liquidity event is the most important financial transaction of your life. You have one chance to get it right, and you better make it count. 

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