348 Chris Younger

[00:00:00]

Jeffrey Feldberg: Chris Younger is the CEO and co founder of Class VI Partners with a mission to empower the entrepreneurial spirit. Sharing a passion for what entrepreneurs mean to our community, Chris felt Class VI could do a better job for business owners by integrating personal and business planning and by taking a holistic view of the entrepreneur's journey.

And before we start this episode, a quick word from our sponsor, Deep Wealth and the 90 Day Deep Wealth Mastery Program. Here's Jane, a graduate who says, and I quote, the Deep Wealth Mastery Program prevented me from making what would have been one of the biggest mistakes of my career. I almost signed on the dotted line with an unsolicited offer that I now realized would have shortchanged my hard work and my future had I accepted that offer. Deep Wealth Mastery has tilted the playing field to my advantage.

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And as you're listening to these [00:01:00] testimonials, are you wondering if you have the time? Are you even thinking that you've got this covered, you have the advisors or people in your network? Well, I got to tell you, these myths, they're often behind the 90 percent failure rate for liquidity events. Think about it. You have one chance to get it right for your financial freedom. You really want to make it count.

And when it comes to time, let's hear what William has to say. We just got in this testimonial, William says, and I quote, I didn't have the time for Deep Wealth Mastery. But I made the time and I'm glad I did. What I learned goes far beyond any other executive program or coach I've experienced. 

So what do you think?

As I hear that, that's exactly what gets me out of bed every day. That's my mission. That's the team's mission here at Deep Wealth to literally change the social fabric of society. One business owner at a time, one liquidity event at a time, and my Deep Wealth Nation, what I want you to know, the Deep Wealth Mastery Program, it isn't theory.

It's from the trenches. It's the only one based on a nine figure deal. And that deal, that was my deal. You know my story. [00:02:00] I said no to a seven figure offer. I created the system that later on, myself and my business partners, we said yes to a different buyer, a different offer, a nine figure deal. That's what we now call the Deep Wealth Mastery Program or the Scale For Ultimate Sales system.

It's built by business owners, for business owners, so if you're interested in growing your profits for preparing for a future liquidity event, and that may be two years away, it could be 22 years away, whatever the time may be, you want to do this now, and you want to optimize your post exit life, Deep Wealth Mastery is for you.

To get started, email success at deepwealth. com. Again, that's success. S U C C E S S at DeepWealth. com. You'll receive all the information about the Deep Wealth Mastery Program or better yet, why not hop on a complimentary strategy call.

We'll go through exactly where your business is today and what's standing between you and your financial independence and your dreams. So that's where you want to be. You want to be with other successful business [00:03:00] owners, entrepreneurs, and founders, just like you they're looking to grow their businesses, create markets.

Market disruptions and unlock their financial freedom to get what they deserve. And whether you've been in business for three years, 40 years, you're a startup, you're manufacturing you're in high tech, low tech, whatever the case may be, coming in and network with other business owners, it's a safe space.

It's a confidential space with business owners, with businesses just like you, because they all wanna lock in their financial freedom and enjoy both success and fulfillment. So again, the 90 Day Deep Wealth Mastery Program, it has your name on it. All you need to do is take the next step. Please send an email to success at deepwealth. com.

Welcome to the Deep Wealth Podcast. While you heard it in the official introduction, we have that mythical creature, otherwise known as an investment banker, here in the house of Deep Wealth, doing some absolutely incredible things. We're going to go take some deep dives in some topics and areas that perhaps you've always wondered, but you don't know.

And as you know, at Deep Wealth, we always say Stop believing and start [00:04:00] knowing. So Chris, I'm going to put a plug in it right there. Welcome to the Deep Wealth Podcast and absolute pleasure to have you with us. And Chris, I'm curious. There's always a story behind the story. What's your story? What got you from where you were to where you are today?

Chris Younger: Well, thanks, Jeffrey, and thanks for doing what you're doing in your show and helping entrepreneurs. It's what a great calling a great service that you're providing. I'm excited to be here. So my story's as my wife likes to say, I have a little bit of career ADD but I started out as an attorney in Silicon Valley and then did a roll up in the communications business.

And that's where I really got my, between doing startup work in Silicon Valley and then doing acquisitions is where I got my first introduction to entrepreneurs. And that really formed for me just kind of a lifelong kind of desire to serve them, but also just a real need to be around them.

as you know, they're unique individuals, driven, passionate, smart committed, perseverant. And so they're just a lot of fun to hang out with. And [00:05:00] so, after we had done our, the rollup in the communications sector that we sold to Avaya we started our investment bank and have been working with entrepreneurs ever since.

And I think as Warren Buffett likes to say, I tap dance into work every day because I, just love working with entrepreneurs.

Jeffrey Feldberg: Terrific story. We're going to talk a lot about that. Before we do, speaking of stories behind the story, I mean, you have a fascinating journey from where you were to where you are today. There's also a story, and we're talking about this offline. So class six partners, and our listeners may be saying, what class six?

What's class six, but there is a story behind the story. So what was going on with the name, Chris?

Chris Younger: Yeah, so class six is a designation for rapids. They're the most the hardest to navigate. And as we think about our job in terms of guiding entrepreneurs through that transition journey we do view ourselves as, hey, this is typically for most entrepreneurs, it's their first and only time through it.

And as you well know, with your own experience, it can be quite daunting and difficult and [00:06:00] challenging and lots of surprises and things that can definitely derail things if you're not careful and so our, again, we view our role as really that guide who's, we've been down the river a bunch of times we know which rapids to avoid and how to navigate and hopefully we can pass some of that along to our clients.

Jeffrey Feldberg: And so let me ask you this, because when you think about it, by the time a business owner speaks to you, they're not perhaps saying it this way, maybe they are, but ultimately you are taking that life dream, those life goals, the opportunity to be the key that unlocks financial freedom, and you're making that possible.

And I'm sure you've seen the so called good, the bad, the ugly. And when everything's working terrific, you have a company that's hitting it out of the park, they're doing everything right. That's always wonderful. And we can sing the praise. Not a lot to talk about there that it's just happening as it should.

I would suspect though, that's not always going to be the case. So normally as entrepreneurs and as investment banks and looking at really what's going on, it's always glass half full, but let's reverse that for just a moment, the glass is [00:07:00] not half full. It's close to empty. Because it's Pareto's law where the business that you're seeing, they are making some fatal mistakes is probably, I'm going to guess, give or take either side, maybe 20 percent of the same issues are creating 80 percent of the problems across the different companies.

And, I know, Chris, you could say, Jeffrey, listen, every company's different. It's all going to be situational, but that aside, are there some themes that you see of some fatal mistakes that you just wish the businesses would know well in advance before they got to you? 

Chris Younger: Absolutely. And I know you've talked about this in the past, which is how do you build a business that can really operate on its own, build a team really get that business to be independent of you as an individual. And I would say most entrepreneurs that we see, there's some level of dependence on that business owner.

It's rare that we see a business where it's truly. Independent of the business owner and more like an investment. And so, and I think what a lot of, business [00:08:00] owners, they struggle with is, number one, how do I build that team, right? Who do I hire and what's the evaluation process? And even if they can, if they're successful at hiring the right person, they have a lot of challenges delegating.

I think entrepreneurs typically are successful because they've got some unique skills and but oftentimes when you look at the hats that entrepreneur is wearing, they're wearing a lot of hats and they're likely wearing hats that, and doing things that they're probably not that great at, and they probably don't like doing.

And so, if we could give one piece of advice, it's really, to your point, do that 80 20 analysis on your own time. Hey, what's the 20%? That you're doing as a CEO or as a business owner, that's driving 80 percent of the value to the business. And how do you free up more time to do those activities?

And, quite frankly, jettison activities that you're not good at or that you don't like. And it's amazing when [00:09:00] we see owners do that, what a transformation in the business happens, because you now go from a business, that's inherently not scalable because it's dependent on that individual to scalable.

And it's a business that now can, it grow much faster, but it also gets that business owner ideally into a better life, right? They're not having to burn, the candle at both ends. And what that allows them to do then is, if they can get more of the life that they want personally, That actually takes the pressure off needing to get a transaction done because they're burnt out or because they're just, they can't do it anymore.

And interestingly, when you remove that pressure to get a deal done, that's when the very best deals happen because it's got to be something really compelling for them choose that over just continuing to own the business and have it generate cash for them.

Jeffrey Feldberg: And, you know, of course, you're absolutely right because one of the favorite questions we have at Deep Wealth when we meet a business owner, and it doesn't matter if it's a [00:10:00] company of two people or 200 people, and the question we ask, does the business run without you? And there's a lot of hemming and hawing, and well, yes, but, so let me ask you this, because one of the narratives, the.

Stories that we tell ourselves, really the lies we tell ourselves at times is, well, you know what, I am really the best. And if I brought somebody in to do it, they couldn't do it as well as me. And I'm just world class in doing this. And I don't want to miss out on opportunities. And that's all fine and good.

But to your point, you need to be scalable. We need to de risk the business. I would love for our listeners to hear what are the prospective investors or buyers? What are they saying to you when they come across a business? That has a skeleton in the closet, otherwise known as the owner, who is very reluctant to give up control or the business is maybe partially independent, but not really independent of the owner.

What are you hearing? What's that backroom talk that's going on?

Chris Younger: That's a great question. And in fact, we just had a conversation very similar to this last night with a buyer for one of our clients [00:11:00] companies. And it really, the question comes down to, hey, if we make this investment or we buy this company and the CEO or the owner stays on, are they just, number one, are they willing to make that transition?

Do they have the kind of internal capacity to start to shed responsibilities and delegate and get comfortable with not making every decision? And it's a great question, right? Because I, have absolutely seen entrepreneurs who aren't capable of that. They're just kind of constitutionally incapable of letting go.

And that business will never get above 10 or 15 or 20 million dollars, you know, however talented that entrepreneur is because you just, you can't scale that way. But the investors, and this is one of the reasons why I think a lot of CEOs and owners who end up selling to a private equity firm, as an example, a lot of them don't last longer than a couple years.

Whether that's the investor's decision because, hey, they [00:12:00] can't get that CEO to really build the team and delegate and get that business into shape, or it's the business owner who says, I can't kind of deal with this as an individual and so I, I need to hand it off to somebody else and, don't necessarily want to be around for, whatever damage that is, right?

And so it's a Again, for the very best deals that we do are deals in which that team is fully capable and is actually running the business because that gives the buyer just that much more confidence. I used to say we did our roll up, I acquired 27 companies over a couple year period.

And if I go back and look at the. Kind of the lessons that you learn, and you learn a lot. One of the most important lessons that I learned was the very best deals we did had a really, really strong number two. Somebody who was kind of capable of executing a plan, they didn't necessarily need to be that strategic CEO, but they could get things done.[00:13:00]

Because when You know, a CEO or an entrepreneur sometimes it's oil and water with more institutional business practices or, things that you have to do to a business to get it to scale. In that case, you at least what we saw as, as buyers was, you know, if we had somebody in there who was already doing that and who was already kind of capable of taking direction and going to execute, those deals were just a lot less risky versus, the business where the entrepreneur was the key salesperson, key operations person, key product person.

Those are very risky acquisitions.

Jeffrey Feldberg: And what's interesting, Chris, and nudge, nudge, wink, wink, it sounds like you weren't busy enough buying 26, 27 companies in that period of time. Sounds like you could have done a lot more.

Chris Younger: Yeah, right.

Jeffrey Feldberg: What a tear you're on just going out there. And let me ask you this because you're on the other side of the table now.

So you're as the buyer. And obviously, like I said earlier, when a company is doing it right, it's so easy. Yes. Let's, Let's pick up this company. They're doing everything right. It's going to make our life easy. I'm wondering though, what would you [00:14:00] have to see that would cause one of two things to happen?

You're saying, no way, I'm walking away from this deal. You couldn't pay me to buy this company, or this is a really a terrific company. Here it comes out but because of A, B, C, and D. It's not worth X, it's worth X minus some kind of large penalty. What would have to happen for those, one of those two scenarios to happen?

Chris Younger: That's a great question. When you think about, kind of, hey, how businesses are valued, right? You're trying to do your best to forecast what cash flows are going to come out of this business and what it might be worth when you sell it as a buyer. And then you're looking at how risky those cash flows are, right?

The riskier those cash flows, the less valuable the business is going to be to you. I do think in It really depends on, hey, what is that expertise of the business owner, and I'll give you a couple examples. If the business owner, I like to put businesses into three buckets and it really is reflective of the DNA of the founder.

And, if a founder is [00:15:00] a product person, it's likely right, a successful business is going to be successful because the products are excellent. They've done a great job developing product. There's good market fit. Then you have business owners who have a sales background. Where they've been successful because that CEO has been a sales dynamo and has been excellent at business development.

And then you have businesses, particularly like engineering businesses or other types of professional services, where it's all about operations. It's all about delivering a great client experience. When you think about each one of those three different types of businesses, for a product, Based business is if you have confidence in the product itself and you don't necessarily have to, innovate perpetually on that product, you'll feel much better about that business than a business where it's got the sales DNA and that CEO is the predominant salesperson because he's got the sales, Hey, if that's where all the revenues are coming from and that CEO or owner loses interest after a year or two, [00:16:00] world of hurt.

On the operations side, really what you're looking for is Are those processes sufficiently institutionalized and built into training and built into development and built into their culture that even if we lost somebody who was running that, we'd be okay? Then you can start to get more comfortable.

But it really, a lot of that is so situation dependent on what is it that we would have to replace and how difficult would that be, if that business owner or CEO left.

Jeffrey Feldberg: It's interesting. And as we love to say at Deep Wealth, from an investor side of things, from a buyer, I mean, no different than us, we always want to minimize the risk. We want to maximize the upside or the profits or the return on investment. And it sounds like you're doing that. And I'm curious because it often doesn't appear on a balance sheet or in a P& L statement, but it plays a very big role in business.

And you could agree or disagree when it comes to company culture. So Chris, when you're going out there and you're representing a company that has a thriving culture, I mean, [00:17:00] they just got it down. They're in sync. They all know what the mission is and they're hitting it out of the park. How does that help you?

What difference does that make when you're out there in the market looking to find the right investor or the right buyer to really maximize that enterprise value? 

Chris Younger: It's a great question and I think sophisticated buyers pay a lot of attention to that. It's very difficult, right? When you think about how typical businesses are presented in our world, it's usually a document. It's a, hey, it's a an information memorandum that describes the business and it's customers and products and everything else.

Very difficult to communicate culture that way, but I will say, and I learned this when we were doing acquisitions, I think when I walk into a business, within about five or ten minutes, if I walk around, I can tell you with pretty good accuracy, here's the type of culture that I see in this business.

Is it collaborative? is there fun going on? Or are people communicating? Is there collaboration going on? There's, [00:18:00] it's sometimes hard to put your finger on, but you can absolutely see. Is it a healthy culture? Is it a stifled culture? Is this one of the cultures that is particularly damaging, which is, hey, everything revolves around that CEO.

That CEO makes every decision. And so it, it may not be in the initial presentation of the business, but certainly when these investors go visit the company and meet the team, they're going to get a very clear understanding of what that culture is And I think sophisticated investors know just how important that is, right? And I also think they appreciate the level of risk, right?

When you acquire a company with a fantastic culture.

You have to be super intentional around, hey, what are the elements of that culture that are so important and how do we preserve, if not improve those?

Jeffrey Feldberg: So culture is certainly foundational, and actually it's so foundational for us in our nine step roadmap. Step two, X Factors that insanely increase the value of your business, Chris, no surprise to you, does the business run without the owner? So do you have a world class [00:19:00] management team? That's one of the X Factors.

Culture is certainly another X Factor, but what I wanted to ask you now, and there's a method to my madness, I'm jumping all around here, but I'll pull it all together for us. There's lots of choices for entrepreneurs, founders, business owners, when it comes time for a liquidity event. And I use liquidity event, they're two stuck up words, very pretentious.

What I like about it, two words, they say a lot, if I'm going public, if I'm taking some chips off the table, if I'm raising capital, a partial exit, a full exit, all the other scenarios that I didn't mention, liquidity event covers it all. And so when a business owner is thinking about a liquidity event, Many choices out there, many investment bankers out there, they may be getting pitched all the time.

Some investment bankers are more buy side than sell side, others are more sell side, which I know where you are. So I'm wondering, what would you want our listener to know of, maybe put you on the spot here a little bit, and no disrespect to any of your colleagues, what to look out for. So what would you not want to have in an investment banker, if I'm interested in getting the best deal, not any [00:20:00] deal, and I'm selling?

Huh. Huh.

Chris Younger: It's a, another great question, Jeffrey. I think historically in the investment banking business, it's a little bit of black magic, right? There's a, you know, mystique about how you go find buyers, and what's the size of your Rolodex as an investment banker, and who do you know, and can you get me in front of the right buyers, and do you know the right buyers, and What's interesting today is and we've seen this time and time again for business owners, a lot of times they'll go to an investment bank that only does deals within their industry, and they do that because, hey, they know all the buyers, and what I would say is, I actually think that a lot of times, You know, that's a potential problem, and I'll, explain why.

when we sold our business, we hired Bear Stearns because they were the communications experts, right? They were the investment bank that did all the communications deals back in the early 2000s. And, I was pretty young, I didn't know any better, and when we hired [00:21:00] them, we thought, well, we're gonna need them to get in front of all these buyers.

We had a nice business and I didn't realize just kind of what that meant and how damaging that could be until we were at the negotiating table. We were sitting across the table from Avaya, who was the top bidder for our business. And so I was on one side of the table. Avaya was on the other side of the table and Bear Stearns was at the head of the table and at that time, Avaya was a public company.

And I thought, this is really weird who's their investment banker? And finally, about, I don't know, maybe an hour into the meeting, I said, hey, let's take a break. And I pulled Bear Stearns guy, and I said, hey are you guys working with Avaya? It just had this weird feeling, right? And he said, well, yes, but not on this deal.

Jeffrey Feldberg: huh. I love that. Yeah. 

Chris Younger: And so when we started our firm, I said, yeah, I would never want a client ever to be in a position. Maybe it's from my legal training to ever question, hey, who are we loyal to, right? And I do think, look, a banking model, great for the investment bank because I can go back to the same [00:22:00] buyers. It's very easy for me to do my market outreach.

I can use similar materials. I can repurpose them for the next business. But what we've learned is in an active M& A market, when you go out to those usual suspects, you know, if they're bidding against each other all the time, their bids start to converge on one another. If, if 20 of us are bidding on the same companies over and over again, where our bids are going to get very close to one another.

And those bids generally are what I would call fair market value, right? No one wants to and be the, the idiot who paid too much. What we've learned is, and especially in today's world, where information is about buyers and what they're interested in is so much easier to get and to get access to.

If we have a good quality, We can get in front of 300 or 400 buyers and you make that market a lot more efficient and you maximize your chances of identifying a buyer who's willing to pay a premium, who really loves your story. And a lot of cases, it's [00:23:00] not from that group of usual suspects. It might be somebody in an adjacent industry that sees your business and says, hey, we really want to get into that space and we're willing to pay a premium to do that.

And so, again, there's a lot of emphasis. On investment banks being specialized having specific domain expertise. And other than areas like biotech or oil and gas exploration where there's a heavy technical component, look, most businesses are pretty easy to get up to speed on pretty quickly for a smart banker.

It really is all about how are they crafting your story. And, are they telling your story to enough people to maximize your chances of getting that outlier bid that's 20 percent more than, the usual suspect's willingness to bid. And that's Jeffrey, I think this business is going to get more and more efficient over time because information is so much more accessible today.

You can identify, a really Good group of bidders who are going to be uniquely qualified and interested pretty [00:24:00] quickly, we can do that in two or three days of research. Whereas, 20 years ago, that would have been almost impossible. But it's, and I think that's going to get more and more, I think our industry is going to change fundamentally.

I

Jeffrey Feldberg: advisory team in the nine step roadmap, we talk about this. We may use different terms. I'll share those. And again, you can agree or disagree. In the world of deep wealth, there's two investment bankers or two types, two categories of investment bankers.

The Transactional Investment Banker and the Advocate. Now on paper, the Transactional Investment Banker, and as a business owner, I love what I hear, until I go below the surface, a little bit of a spoiler alert, Transactional Investment Banker, Jeffrey, I know your industry. I have done most of the deals in your industry.

I know all the buyers in your industry. I will get you in front of them. I will get you in and out as quick as I possibly can. And because I'm the go to person, I have all the connections, all the backroom contacts. Let me take you out to market. Versus an advocate, Jeffrey, I may not really know your industry.

 I'm thinking, I can't [00:25:00] even think of a deal I've done in your industry. I don't really know the buyers. We don't really specialize. We're more of a generalist than a specialist. It's going to take me longer to put together a list of buyers, but I will get you out there. I'm going to do a very thorough job.

I'm going to cast a wide net. So at the surface, a little bit of a trick question here. If I were to ask our listeners, who would you go with? Many of them would say, well, let's transactional investment banker. What the transactional investment banker left out, by the way, Jeffrey, you're a one hit wonder. I do billions of dollars books of business with the same buyers again and again.

So if you pushed me into the corner and push came to shove, who am I going to pick the best deal for Jeffrey or really upsetting the book of business? Sorry, Jeffrey, you're going to lose out every time versus the advocate, which is really where you are, Chris of, you know what, Jeffrey, I don't know these buyers.

I'm likely never going to deal with them again. I will fall on the sword for you to get to the best deal. Even if I never do business with that buyer again, because I don't really care. You are my priority. You're my number one, you're my [00:26:00] specialty. And that's really where things are at again, Jeffrey. You're on base, off base.

Where are you on that narrative? I just shared.

Chris Younger: totally agree. 100 percent on the same page and, I mean, that's the Bear Stearns story, right? I knew in that meeting, in your words, I was the one hit wonder and Avaya was the relationship and that was, you talk about feeling naked in a negotiation and it fundamentally changed my relationship with Bear Stearns, right?

Because instead of being somebody that I could rely on. To help guide because this was our first time going through this process now we were in a position where we were kind of on our own and that's not a very comfortable position and not just on our own but now even suspicious right, hey, I've gotta dissect every piece of advice now that I'm getting from Bear Stearns because I honestly don't know if that's in my best interest.

I completely agree. I think again, outside of Highly technical industries where you've got to have, engineering expertise or technical [00:27:00] expertise. Again, most businesses, a good investment banker is going to be able to get up to speed pretty quick. I also think that telling the story that there's You should be spending a lot of time with your banker building the right story.

And too often when I see stories coming from or, books coming from industry specialists, they all look pretty similar. And it makes sense, right? That's an easier model to execute. Like I said, as a banker, that would be a lot simpler model. You're going to make a lot more money that way.

But I also feel like, hey, the goal there is, how quickly can we get this deal done? And as I tell clients I think their promise of, hey, I can get you in front of these buyers and I can get your deal done quickly, I think it's true. Do I think they're going to get you the best deal? I don't think so.

Jeffrey Feldberg: Absolutely. And what's interesting, it's a perfect segue and you read my mind, Chris. In the nine step roadmap, step one is the big picture. Okay. What are the inflection points? What are the blind spots that if we can uncover now, we can leverage those and create a market [00:28:00] disruption. And then as we're thinking about doing that step two, X Factors, what are we really world class in?

What sets us apart that we're not just another logo. We're not saying we're the best in the world in service, like everyone else's. No, here are the specific areas that we're really good in because, and again, here's the method to the madness. We're taking step one, big picture, step two, X Factors. We're combining all of that to create a narrative specifically for the investor or the buyer.

Here's our proposition. And for all the financial people, they want to throw all these rotten eggs and tomatoes at us. And they get upset with this because what I'm going to say doesn't show up in a spreadsheet or in a complicated formula. And in fact, I've had valuators come onto the podcast and actually agree with this.

And the valuators, in their words, they've said, Jeffrey, 80 percent of the value of a company comes from the narrative. I will look at the narrative first. Yes, of course, the facts, the data, the numbers need to support that narrative. If it's a really good narrative, you've got my attention. The value is increasing.

So [00:29:00] welcome to the art side of a liquidity event, the art side of a business. Chris, you may completely disagree. You may agree. Where are you on that? And you alluded to this just before in your last comment about the narrative, the story. What's going on with that?

Chris Younger: I think you're right. It's the story that, if you think about when you take a business out to market whether it's a private equity investor or a strategic buyer, they might look at a thousand or two thousand companies a year. So what is it about your story that's going to hook them? What is it about your story that's going to be different?

what is going to be compelling to them? And that, takes some work, right? I often say, think investors like businesses. For a lot of the same reasons that customers do. If you can identify, hey, why do customers pick you, you're 80 percent towards telling your story to the investors, right?

Hey, this is why you're going to be interested in this business because it has this level of competitive advantage. And and once you tell that story, to your point, it's got to be supported by the numbers idiom that I like to tell are, [00:30:00] clients is The longer the story we have to tell, the worse it is.

So if we have a really compelling story and our numbers support that story, we're in a great spot. If we have a really long story and the numbers don't support it, we're in an awful spot. You've got to capture their attention with something that's unique. It's compelling. It's different. And then, yeah, it's got to be supported with data because in today's world, most of those buyers out there are highly financially driven.

You don't get to that table until you can tell them that story.

Jeffrey Feldberg: Absolutely. And I'll throw something else. That's contentious for a lot of people. It doesn't matter if it's a hundred dollars sweater or if it's a hundred million dollar or billion dollar company, we make decisions on emotion first and we justify with logic later. So if I got this great narrative, it gets me excited.

Okay. I don't want to lose this deal. I remember the last time I lost this deal, they went on to become a unicorn and I was kicking myself. I'm going to overpay on this one. I'm really excited. It's got the same feeling as the last one. Let's go and do it. So let me ask you this, with your secret sauce, what you're doing at class six, when [00:31:00] a company comes to you and now you're working on that narrative, you're really positioning them and because you're that advocate, you're casting a wide net.

It's not just the usual suspects. You're going out there, different industries, looking for the different angles to have as many potential buyers or investors at that deal table as possible. What's your secret sauce, Chris? What are you doing with the business to really give it the upper hand, the advantage?

Chris Younger: I think a lot of it is just preparation, right? you know, Hey, if a company's gone through your program, that's a huge step up because they're already thinking about and hopefully addressing issues that are going to degrade value ahead of time. We have a lot of clients that have been with us for three or four or five years before they've gone to market and that gives you a great opportunity to really give them feedback of things that they can go work on.

Again, for most business owners, they don't. Have that experience of having exited. And so, again, somebody going through your program or being able to get that experience where they can kind of see the test ahead of time their ability to start to fix things well [00:32:00] ahead of time is a huge advantage.

And so I think the, more than half of our business are company owners that say, hey, I'm ready to go to market. Inevitably, as we're preparing that business to go to market, there's a voice in the back of our head. Boy, if I could just talk to Jeffrey two years ago, we could have avoided a bunch of this headache that we're experiencing right now.

So that whole notion of start early. And be intentional and be thoughtful I think is a, huge piece of success for those business owners and hopefully what both you guys are doing and what we try to do with clients as well is just how do you get them into that spot. I think the second piece is, deals, the failure rate for deals is pretty high if you're not prepared.

And so, really, Digging into the business, obviously getting all the diligence materials prepared, and we're huge believers that, and every business has it, every business has warts, you want to present the business warts and all, and you want to, you have a wart, It's okay, every business has them, you just want a position around it, but you can't do that [00:33:00] unless you know about it, unless you've been thoughtful about it, unless you've been able to build the story around that.

The worst thing you can do is present a too rosy picture of the business only to have it fail during diligence because you waste a ton of time and money and it's very damaging to the business.

Jeffrey Feldberg: And for our listeners, I promise you, I really do. I promise you, Chris and I did not speak ahead of time for Chris to say this. Chris, you're never a, really a prophet in your hometown. We're saying this all the time and you're absolutely right. I mean, step four in our process, it's an internal audit and we get challenged on that.

Why am I going to do due diligence? Second time, you know, a third time, I'm going to do it in the deal. Let's just get to when we get to it. And we actually want that ahead of time. So there are no surprises. You are finding those skeletons in the closet, or maybe those beautiful X Factors or what we call Rembrandts in the attic.

We'll put them out for public display that there are no surprises because Chris, you're right, the currency, it's not money, it's trust. And if you have that trust, you can make some mistakes along the way, you own them, the buyer, the investor. Okay. You know what? Jeffrey's been straight up with me and yeah, [00:34:00] this happened.

Everything else is checked out though. I'm going to give the benefit of the doubt here. I'm not going to hold it against Jeffrey and team because they've ruined my trust along the way. It just makes a huge difference as you're doing that. And let me ask you this. We're going to talk more about your process, but I'd be remiss if I didn't ask about AI.

So AI, huge inflection points, step one, big picture, really for every company. I'm curious. Internally, so as you look at your business, how's AI changing that or helping or impacting what you're doing? And then broader in the world context, how's that impacting M& A?

Chris Younger: You must be sitting in our staff meetings, Jeffrey. we actually have a woman on staff that's her whole job, or most of her job is to be evaluating tools. As I think about our business it's about information, it's about wisdom, and it's about counseling. I don't think AI is going to replace counseling.

I don't think it'll replace much of the wisdom. I think going to have a huge impact on the information processing. So, we have tools [00:35:00] internally that we're testing and evaluating both Hey how do we process, digest, and analyze financials much faster because that's a big piece of what we do.

How do we analyze diligence materials much faster? And there's actually a lot of tools out there to help with that process. How do we identify the right buyers? We've been testing probably three or four different tools that will help accelerate that process. As I said, I think in two years, the how of what we do in the background is going to change dramatically.

And, we're constantly evaluating, look, there's a lot of brand new tools out there that you probably don't want to implement. But you do want to see them, and you want to test them, and you want to stay in touch with those companies as those products develop, because I do think that it's going to, fundamentally alter the way that we do our business, and allow us, quite frankly, to focus on the higher value add.

That we do in, in the form of, again, that wisdom just having the experience, and then the counseling piece, because, we have a chart in [00:36:00] our uh, office that kind of goes asymptotically up to the right that, the bottom axis is time and the top axis is the amount of counseling that we're doing for our clients during, over the course of a transaction.

That, I don't think will ever get replaced but it's fascinating to me and I'm excited about what's coming down the pike. I'm sure it's scary for a lot of businesses, but I look at it as, hey, this is just another way for us to up our game and get more efficient in terms of how we're taking care of clients and over time, hopefully reduce costs.

Jeffrey Feldberg: Absolutely. And as you're going through that, what's interesting, you mentioned a few times and our listeners Picked up on this for some that have never done this before. It's okay. I show up to an investment banker. They take me to market and whatever it is, six months, nine months later, it's done. And I'm writing off into the sunset, another chapter of my life.

I've got all these zeros in the bank account. If it were only that easy, Chris, is an emotional rollercoaster as the business owner. And particularly part of our method to the madness is if you can prepare for that ahead of time, you're not sacrificing your mental health, your physical health, [00:37:00] your time, your money.

You're better equipped. But even with that preparation, it's still an emotional rollercoaster. What are the kinds of issues that you're counseling your clients through that, again, we'll keep it high level. Obviously, we're not going to break any confidentiality or get very specific. Big picture wise, are there 20 percent of the issues that are 80 percent of the challenges or so called problems that are being created?

Chris Younger: You just did a podcast on deal fatigue. I mean, every deal. And we I can't tell you how much time we spend with clients preparing them for what's coming. at the beginning of a transaction, we do a very deep dive into here's what to expect at every step along the way. Here are going to be the highs of the transaction, here are going to be the lows, and here's what to anticipate.

And Jeffrey, no matter how much counseling and advice that we give ahead of time it doesn't seem to avoid. What actually happens, right? It's at the end stages of a transaction, even very small issues when both buyer and seller feel like we've been at this a long time the seller feels like the buyer's [00:38:00] asking the same question, 20, 000 times, and they're frustrated, both sides feel like, hey, I've given everything that I can give, then even those little issues can turn into really big issues.

And we try to give our clients just, hey, here's what's coming, right? Here's what to anticipate. What you have to do is keep that end in mind. Why are we here? What are we trying to accomplish? And let's make sure we keep that in focus. I think a lot of entrepreneurs are trained to win. And at some point you have to redefine winning, right?

Winning is not necessarily getting every scrap that's on the table. Winning is, hey, I've accomplished what I wanted to accomplish personally and I'm set up for that. That's one thing that we see often. I think the second piece, and you just identified it, which is. A lot of entrepreneurs are tied up, their identity is tied up in their business.

And so this transition away from the business can be quite upsetting. And we've watched this. And if an entrepreneur hasn't prepared for that if they're not running to something with purpose. it can be quite disconcerting for them. And [00:39:00] it's something that, when we take on a client, we sit down with them ahead of time and say, what is it that a sale of your business is going to make possible?

That's not possible today. Let's make sure we're clear about that and why you're going towards that. Because if you don't have that Northstar, the transaction process can just be brutal.

Jeffrey Feldberg: so interesting that you say that because if there's ever a poster child of what not to do post exit, I'm that poster child. I was so focused on crossing that finish line, I never thought of what's next on day one of the new chapter, what's ahead for me, which is why, no surprise, some of the biggest mistakes of my life came post exit, not pre exit.

And that's why now in Deep Wealth 10th step. We talk about the nine step roadmap. It's a 10th step. We actually make it the very first thing that you do is you talk about the post exit life before you do anything else. And it's actually a really good segue in your five stages of entrepreneurship. So you start with the assess and then the grow, the sell.

I want to dial in onto the thrive and the give, because you don't see that a lot with [00:40:00] most investment bankers. So Thrive and Give, what's going on with Class VI and what are you doing there? Spot

Chris Younger: So one of the, Our mission is to empower the entrepreneurial spirit because we believe so strongly in what entrepreneurs mean to our community, both with respect to kind of growth in the community, economic growth. Here in Colorado, mid market businesses, which are the types of companies that we work with, are the principal driver for the economy.

And I do think a lot of entrepreneurs are unsung heroes in terms of what they mean for the economy and what they mean. What we've also seen, and this is probably the most gratifying is our clients are some of the most charitable people around. And like I said we've estimated we've done about three billion dollars worth of transactions.

We've estimated about 250 million of that. has gone back into the community in some form or another as charitable giving and it's that for us is actually one of the stats that we pay close attention to, you know, we've got as part of our 10 year goal to see if we can generate enough liquidity for business [00:41:00] owners that we can see a billion dollars having gone back into the community.

That'll be a big milestone for us as a firm. I think it goes back just to purpose, right? One of the things I'm a huge believer in is um, and particularly for our team, just doing deals, it's fun. Don't get me wrong. I love doing deals. I love working with entrepreneurs, but if that were the extent of it, it'd be pretty hollow, right?

you've already experienced it, right? My guess is, hey, even with a bigger bank account. You still have all those fundamental questions, right? Hey, why am I here? What am I doing? What's my purpose? How am I giving back? How am I serving others? And so we've really tried to define that for us as, hey, our job is to serve these entrepreneurs who are in turn going to serve the community.

And it just gives us a lot of meaning and purpose. And we love watching kind of the fruits of our labors in terms of what it means to our communities.

Jeffrey Feldberg: on, Chris, and I can personally attest to this. All the accolades, all the success, all the zeros in the bank mean absolutely nothing if there's not fulfillment. Said in another [00:42:00] way, Success without fulfillment, it's a failure with a capital F. It's only when you have the success with the fulfillment and the fulfillment doesn't need to be financial.

Oftentimes it isn't, it goes into many other areas. That's where the rubber really hits the road and we're enjoying life. After all, that's why we start businesses. That's why ultimately we exit at one point in time. So it's terrific to hear that as we do here at Deep Wealth, you're really changing the social fabric of society.

By helping the business owners, your clients realize financial liquidity, unlocking their financial freedom so that they're going to thrive personally, but they can also give back to the community, which is a terrific story. Chris, I can go down so many other topics. We're starting to bump up against time.

Before we go into the wrap up mode, is there a message or a topic that you'd like to share with our listeners?

Chris Younger: It's very consistent with what you're doing with your roadmap, and that is for a business owner, you should be as intentional around what your game plan is for a transition as you have been about building your business. I was, [00:43:00] too often we see business owners that have spent, years and years building up.

The business and but we've also seen a lot of entrepreneurs just leave so much on the table financially and otherwise by not spending kind of the required time doing the preparation, being thoughtful, being intentional and doing that work ahead of time. And so, again, to the extent that we can get business owners to be thoughtful about that three or four or five years ahead of time, they're just going to be so much better off.

And as a result, hey, communities are going to be better off. They're going to set greater examples for other would be entrepreneurs to follow,

Jeffrey Feldberg: Of course, you're preaching to the choir that's right out of our playbook. And look no further than myself, if I would have said yes to that original seven figure deal, the nine figure deal, I actually created it. I just didn't know at the time that it was there. That's on the deal table left for the buyer or the investor.

And that's why we say Deep Wealth. Most business owners, they don't realize that the next time a friend, a colleague, a buddy comes in, hey, Jeffrey, I hit it out of the park. I sold my company for X. Well, they probably left [00:44:00] another X on the deal table unknowingly. And the other point, we also say up to 90 percent of liquidity events fail, again, from that lack of preparation, just not putting in the time ahead of time, which actually saves time.

What is it is? It's the, one of the services, they say that slow is smooth and smooth is fast.

Chris Younger: Right.

Jeffrey Feldberg: it's same thing with the preparation. When we do the preparation, okay, it's slow in the beginning, but we get smooth as a company. And that smooth becomes fast later on in a transaction. And as we know, speed always wins.

So well said, Chris. Well, let me ask you this. It's a privilege here for me to ask every guest same question. And it's a tradition here on the Deep Wealth Podcast. It's a really fun one. And it sounds like you've been doing your due diligence. You've been listening to some of the podcasts. So it sounds like you'll be prepared, but we'll go through it anyways.

We'll have some fun with this. When you think of the movie Back to the Future, you have that magical DeLorean car that will take you to any point in time. So Chris, the fun part is tomorrow morning, you look outside your window. Not only is the DeLorean car there, [00:45:00] curbside, the door's open. It's waiting for you to hop on in, which you do.

And you're now going to go to any point of your life. Chris, as a young child, a teenager, whatever point in time that would be. What are you telling your younger self in terms of life lessons or life wisdom or hey, Chris, do this, but don't do that? What would that sound like?

Chris Younger: Great question. As I think about lessons that I've learned, I think one is it's never that serious. I think the second one is never as good as it seems, and it's never as bad as it seems, advice from one of my mentors is, on a related note, you know, just never get too high and never get too low otherwise life could be pretty violent for you, and not necessarily the most pleasant, but I think the, look as young, aggressive, ambitious people it feels like everything's on the line always, and I'm not sure that's the healthiest way to go through it.

Jeffrey Feldberg: It's a terrific perspective. And for our listeners, we always like every episode that there's one actionable takeaway, low hanging fruit, low effort, high reward, and really mindset. What you're talking about is, hey, it's really never that serious. [00:46:00] And don't take yourself too seriously. Have some fun along the way.

Perhaps enjoy the journey. That's really where it's at. Absolutely love that. And Chris, for a listener who perhaps has some questions or they want you to take them to market, or they want to learn a little bit more, where's the best place online for someone to reach out to you?

Chris Younger: Sure, they can go onto our website they can certainly reach out to me personally. Our website is www. class6classvipartners. com, and I'm Chris at class6partners. com. We do a lot of pro bono work, always happy to help an entrepreneur.

Jeffrey Feldberg: Well, it doesn't get any better. Chris put his personal email address or his business email address out there and take him up on that, ask some questions, learn a little bit, get some insights. Of course, you've been on both sides, buyer, seller, there's a lot that you can give. And with that said, it's official, congratulations.

This is a wrap. As we love to say here at Deep Wealth, may you continue to thrive and prosper while you remain healthy and safe. Thank you so much.

Chris Younger: Thank you. 

Jeffrey Feldberg: So there you have it, Deep Wealth Nation. What did you think? So with all that said and as we wrap it up, I have another [00:47:00] question for you.

Actually, it's more of a personal favor. Did you find this episode helpful? Have you found other episodes of the Deep Wealth Podcast empowering and a game changer for your journey? And if you said yes, and I really hope you did, I have a small but really meaningful way that you can actually help us out and keep these episodes coming to you.

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So all that said. Thank you so much for listening. And remember your wealth isn't just about the money in the bank. It's about the depth of your journey and the impact that you're creating. So let's continue this journey together. And from the bottom of my heart, thank you so much for listening to this episode.

And as we love to say here at Deep Wealth, may you continue to thrive and prosper while you remain healthy and safe. [00:49:00] Thank you so much. God bless.