In this episode of the M&A Launchpad Podcast, hosts Feras Moussa and Casey Minshew sit down with Adam Koos, founder of Elevate and Exit and Libertas Wealth Management. With a unique background in both psychology and finance, Adam helps business owners prepare for the biggest decision of their lives—selling their company.
From the emotional side of letting go of a business to the hard numbers that make or break a deal, Adam shares why most owners wait too long to plan an exit—and how that mistake leaves millions on the table. He dives into consultative selling, minimizing key-person risk, and how to structure businesses for a smoother, more profitable transition.
If you’re buying, selling, or just starting to think about succession planning, this conversation will give you practical takeaways and a new lens for approaching the exit process.
In this episode, we discuss:
- Why 80% of businesses never sell—and what owners can do differently
- The role of psychology in exit planning (and why it matters as much as finance)
- Top mistakes owners make before going to market (and easy fixes to de-risk)
- How to prepare years in advance for the best valuation and smoothest deal
- Legacy, taxes, and life after the sale—what every seller should consider
- Consultative selling and building rapport with owners as a buyer
Connect with Adam Koos
LinkedIn: https://www.linkedin.com/in/adamkoos
Exit Planning Firm: https://elevateandexit.com
Financial Advisory Firm: https://libertaswealth.com
M&A Launchpad Conference
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Additional Resources:
Sponsored by O’Connell Advisory Group – Work with a trusted Quality of Earnings and Financial Diligence partner who focuses solely on business acquisitions.
Visit: https://www.oconnelladvisorygroup.com
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Transcript
00:00 All right. Well, on today’s episode, we interviewed Adam Cous. You know, we really talked about kind of the
00:06 financial planning and and really kind of getting sellers ready to exit their their business. So, Casey, what was some
00:12 of the big takeaways that you had from the episode? You know, it’s it’s all comes down, you know, because Adam’s background in
00:19 psychology. Yeah. Which I thought was an interesting kind of take on a financial planner, right? I know. But there’s a lot of duality
00:24 between these two things. But when you’re meeting with somebody that’s making the biggest decision of their life,
00:29 you have to have some type of sensitivity to the other person that you’re talking to, right?
00:35 Someone’s just not going to go, “Oh, yes, I’m going to sell you my business.” Right? There’s a process and there’s a lot of psychology that goes into it. And
00:41 so what Adam does to meet with them and help them get ready is no different than what we do to try to help to try to buy
00:47 their business. Y same process, same conversation. We’re just going at it at different angles. But ultimately, you’ve got to be a
00:53 consultant salesperson. Yep. You’ve got to be consultant. You’ve got to educate. You got to bring something to the table. Is it taxes? Is it this or
01:00 that to keep that interest and drive that to the line. So, I I I loved everything we talked about. Yeah. And I would say that to to add to
01:06 that, the one thing that I thought was kind of interesting, too, is you know, you know, him trying to get in as early
01:12 as possible before like I think a lot of people take too long. they it’s a snap last minute decision and he’s saying,
01:18 “Hey, no, you need to be planning this out for years before you actually sell
01:23 or just and even if it does take maybe even a decade, you’re at least ready because you set the foundation
01:29 correctly.” And I think a lot of sellers get into running their business, you know, and and they don’t think about the
01:35 exit. And I think that’s where Adam and his firm really kind of help work with business owners to like, hey, get these
01:41 things in place and even if you don’t use them for 10 years, you at least are ready to to pull a trigger on a on a
01:47 potential sale down the road. And I always thought that that was interesting. There’s a lot in this episode. So looking forward to it.
01:54 [Music] Hey there, this is Casey with the M&A
02:00 Launchpad podcast. Want to let you know about October 25th. put it on your calendar. This is a do not miss one day
02:08 event. There’s going to be incredible headliners, but really at the end of the day, you’re going to get a chance to
02:14 talk to people that have made acquisitions, learn from some of the challenges that they’ve made, because this is definitely a challenging
02:20 process, but more importantly, there’s going to be people there that can help you and support you along the way from
02:26 great vendors, quality of earnings, how to run the due diligence process, and how do I get financed, how do I raise
02:32 capital, how do I structure all of these things? October 25th in Chicago, we’re going to be gathering. It’s going to be
02:38 hundreds of people that are all focused, like-minded people, and man, everyone that’s come has given us incredible
02:44 feedback. So, mark your calendar. October 25th in Chicago. We look forward to seeing you.
02:50 All right, Adam. Hey, welcome to the show. Yeah. Thanks so much for having me. I appreciate it. Yeah. So, why don’t you just dive in and
02:56 talk to us a little bit about your background, what you do, and uh we’ll we’ll start asking you a bunch of questions from there. Sure. I’ll give I’ll give you the
03:01 cliffnotes version because there’s a lot. Um, I I started um my my plan was
03:07 to become a a trauma surgeon. I was in premed at Ohio State and some personal things happened to me and I decided um
03:14 you know my senior year to drop out of the program and my dad told me I I ought to become a financial adviser. I thought
03:19 he was crazy but he he thought I was good at making complex things easy to understand and I was always messing
03:24 around with this virtual stock exchange account. So um he told me I could do a become a financial surgeon. That’s what
03:29 he said. So nice. Um, that’s how I that’s how I got into the financial business, I guess. Ended up getting a,
03:34 uh, double major in finance and psychology, but I always joke I use the psychology degree more than I do the finance degree, it seems. But, uh, and
03:40 then from there, um, ended up in the exit planning world. Uh, we call it BTP or business transition and exit
03:47 planning, you know, value acceleration. Um, just after COVID, I mean, we always worked with business owners on on the,
03:53 uh, business advisory front, specifically with retirement plans, cash balance plans, pensions, things like that. But it wasn’t until co that um I I
04:01 read a book frankly and and the statistics shocked me and we can get into that later. And so I I got into
04:06 that and then I started another company where I helped financial adviserss um grow their firms um not necessarily to
04:11 sell but you know but but so that’s kind of that’s kind of where I’m at today. That’s the Cliffnotes version. So all right so it sounds like you
04:18 you’ve done a lot you you talked to a lot of business owners, right? You know I mean I guess from from your
04:23 perspective what what’s the most exciting part of what you’re doing right now? Is it the kind of helping them plan
04:28 for that next phase of their career or is it the financial you still liking the financial planning and advisory part of
04:34 the the business or what does that kind of look like? No, sure. My favorite part person and then again you said right before we
04:39 started recording you said there’s anything off limits. So I’m going to be honest. Um my favorite part of all of this stuff,
04:45 it doesn’t matter whether it’s a non-B business owner, a business owner, um a financial adviser, I just like I like
04:50 the the act of of helping them learn the things they don’t understand and bringing awareness first and foremost. So, um, sitting down and doing the
04:58 planning, um, isn’t, frankly, that doesn’t really get me up in the morning. I always say that, you know, what wakes me up every morning and gets me pumped
05:04 up about going to work these days, you know, doing this for 24 years is, um, saving people from bad advice and bad
05:10 advisers. Like, you can’t save everybody, but that’s what really jazzes me up. So, I think that um I think what
05:17 I love the most about working with business owners is that the vast majority of them don’t know how
05:23 important it is to start planning to sell. Um, and they just put it off and put it off and put it off and they keep
05:29 working harder and harder and harder and and then, you know, unfortunately the statistics say that most of them uh
05:35 don’t sell because they just don’t plan in time and it’s and it’s really sad and it’s frustrating and shocking really.
05:40 So, I think that’s what really excites me the most is just bringing that awareness out to the business owner community.
05:46 So, there was a there was a this is kind of what got me into this space as well is this this this baby boomer aging and
05:52 then a lot of businesses not being able to transition and uh there was a jewelry store that did very very well here in
05:58 Houston. I think it was like Karks or whatever it was. They had a location up in the Woodlands where I’m at. And I was
06:04 absolutely shocked to hear when they when they closed down and it was like a real I mean they had
06:10 locations all over Houston and I talked to somebody that knew them and they just none of the kids wanted it
06:17 and the parents just were like we don’t even want to go through this process and they just closed down and you’re like so
06:22 when I talk about leaving some money on the table right they leave their money. Well no but like my point is is even like there’s still value there though,
06:29 right? You know, that’s that’s that’s what’s crazy. Great brand and you know I mean and and you see that too, right? You’re like, “Well, maybe
06:35 I’ll just shut it down, you know, and and you’re just like, why why would you do that? You’re leaving money on the
06:40 table.” Yeah. Or they get sick, right? And they haven’t planned. And that’s probably And tell me if that’s what you’ve seen most
06:46 of is I’m I’m getting to 65. I’m going to live forever, right? Then I have a heart
06:52 attack or something occurs and I have to put in a system of process. I have no way to exit and no one’s ready to take
06:58 over and it’s done. Heart attack, stroke, dementia, um divorce,
07:05 um they have a partner and the the partnership falls apart. Um I mean there’s there’s the reasons are endless,
07:11 honestly. Um and and we all think it’s just not going to happen to us. Yeah, that’s true. I mean, and I think
07:17 that’s just human nature, right? We all think that we’re going to live forever until something tragic happens and then it’s like a wakeup call and you’re like,
07:23 “Oh, wait. I need to figure out like my affairs here, right? What if that could happen to us or what if that could happen to me, right? But like, okay, so
07:30 a lot of our listeners are either business owners potentially looking to exit or people looking to buy their
07:35 first or second business, right? So, like what are some of the I mean, obviously you’re working with a ton of businesses. What are some of the like
07:40 glaring mistakes that are just like so easy to fix ahead of time, you know? Kind of maybe give us like your top two
07:47 or three like sure business owners, please listen up. Like this is the golden nuggets that Adam’s going to drop right now. like
07:52 that that that type of stuff. I think the overarching biggest thing is to pretend like you’re a buyer. If you
07:57 can do that, if you can step out of the box and you can look at your company as if you were going to buy it and make a
08:03 T-chart and say, “Here’s the reasons I would buy it and here’s the reasons I I wouldn’t buy it.” Um because I think that’s probably the biggest mistake they
08:09 make is they’re not able to step out of the box. You know, we um I can’t remember who said this. I think it was Chris Snder. Um, you talked about how,
08:16 you know, a business is like our baby and nobody wants to be told your baby’s ugly. But, you know, often times it’s it’s,
08:22 you know, it’s not ready. So, um, I think the second thing I’d say is that too many times you’ve got this
08:27 successful business, but it it relies too much on the owner. And buyers are going to come in and be really nervous
08:33 about buying a company where if the owner’s gone, what happens to the customers? And with that you get
08:39 customer concentration problems where you know what percentage of the revenue is the top five, top 10, top 20, you
08:44 know clients, customers, patients, whatever you want to call it. Um so that’s another issue. Uh de-risking from
08:49 continuity standpoint. Um having contracts, bonuses, something in place for retention for key staff is another
08:56 mistake I see a lot. Um, we had one, we ended up not working with them, but we had one uh bank that was referred to us.
09:04 And they not only were all paper, no technology, they thought their company
09:09 was worth about two and a half times what it really was. Uh, nothing was electronic, like I said, all paper. And
09:15 their CEO was leaving and they wanted to sell next year. And it’s like, well, you’ve got to get another CEO first
09:20 before you sell, right? And they said, no, no, we’re just going to sell. I’m like, you can’t like you’re not going to get that multiple.
09:25 Yeah. So, I mean there’s there’s a lot, you know, um but it comes down to risk at the end of the day. A buyer doesn’t want
09:31 to buy something that has high risk. And you know, there’s a lot of no matter what, you can’t get rid of the risk, right? You guys know that. Um yeah,
09:37 but you want to minimize it, right? So, a couple things that I that you’re saying that I think our listeners will
09:42 really dive into. And a lot of the process, right, that someone goes through in buying a business, you’ve got
09:49 to first find the business, right? Then you’ve got to get that buyer and the the
09:54 seller and you in alignment to agree that you’re the right person to transition and buy the business. Right?
10:00 So these guys got to go through a lot first just to even get to the closing table. Then they’ve got to get
10:06 financing. They’ve got to go through all this stuff to get through that that hump and then they’ve got to take over and run the business. So it’s a very it’s
10:13 very difficult. And uh anybody that’s saying it’s not is you know they just
10:19 don’t know. It’s very they’ll learn. But but in that meeting, one of the things I enjoy doing with the sellers,
10:25 right, is I really like to spend a lot of time seeing if our core values are aligned, right? It is critical for me to
10:33 be able to get a business and bring it across the line if we’re not if we’re not seeing eye to eye, which
10:39 we are not buying companies where the seller is going to leave the day we close. Just not going to happen. And so in my
10:46 first conversations and in my meeting, it’s the hey, let’s transition it. And so where you were talking about keyman
10:52 risk, right? A lot of these deals have a tremendous amount of keyman risk. We just bought a business that had like
10:60 it was keyman risk. Well, we we know what we’re doing. We knew we we we brought in the team. We
11:05 did all those things and but he was never going to sell his business for the top dollar and he knew it, right? So we
11:10 ended up getting a great trade because he wanted the legacy to live on. So, that’s where I’m getting to is the
11:16 legacy, right? I talk a lot about legacy in my conversations. What What does the
11:22 brand look like? We’re not here to change your brand. We’re not here to change this and change that. That’s my talk track, right? So, when you’re
11:29 talking to sellers, right, and you’re you’re helping guide them to these exits. What are the things that you’re
11:34 talking about with them? So, as so us as as that are coming to talk to them at a later date that you’re preparing them
11:40 for, what are those key things that we should know when we’re talking to these guys? Sure. Yeah. I think that uh this this if
11:45 since you started with the soft you know the soft topics you know things like um that aren’t necessarily tangible or
11:50 quantifiable um would be you know asking them you know what what does what does an exit look like you know first and
11:56 foremost like is there is there um you there’s different ways to exit right you can sell to different types of people
12:01 companies you know private equity can be a competitive buyer um so we want to know make sure they understand the
12:06 different types of sales and different types of buyers so they can find a right match definitely want to find out how
12:12 how much they what the relationships are like not only with their customers but their staff, you know, with their team.
12:18 Because I think that one problem we might run into from time to time, if I’m just being totally transparent, is you
12:25 run into an occasional owner that doesn’t seem I don’t want to say doesn’t seem to care as much about their team,
12:30 but they just it’s it’s not they’re looking at the numbers and that’s it. And and sometimes that can be tough for
12:36 the buyer. I think I think that that’s that creates more risk and it’s intangible risk. It’s not something
12:42 again you can just put on paper and a number. So I think that making sure we understand um who they want to sell to
12:49 so that they can find a personality match because any good business owner again it’s their baby. Any good business
12:54 owner is going to want somebody to come that’s going to take care of their people and their people are obviously their you know their clients, their
12:59 customers and and their team, their staff. The second thing I think would be just the numbers. I mean, I think too
13:05 many times, and I’m sure you too have seen it, but I’m I’m sometimes shocked when I see the books um of some of these
13:11 companies that they’re it’s amazing. They’re so successful and the and the book some of them are making millions of
13:16 dollars, too. They’re just I mean, it’s being run on a spreadsheet and there’s no real there’s there’s certainly no gap
13:22 accounting going on anywhere. Yeah. there’s accounting entries that don’t make sense and then you know um
13:28 they’re ready to get evaluation done and they haven’t done any recasting no adbacks and it’s it’s I mean so that’s a
13:34 a big a I want to call it a struggle but one of the biggest humps we have to get over is the adbacks the recasting and
13:40 making sure that you know look if you’re if you’re if you own your office building which many owners do and you’re
13:47 you’re paying a le you’re paying a lease of you know $500,000
13:52 a month but you know that the the going rate’s 300. We probably want to change
13:57 that. If you have three three cars in in in your company that you know you drive,
14:02 your your wife drives, and your sister drives, you probably want to recast that, you know. So, there’s things like
14:08 this and then it gets that’s easier. It’s the stuff like meals. I’m not going to let them add back that stuff. No way. That they they are not
14:14 going to get a multiple on that ad back. I’m sorry. I will fight that one. One car. Understood. Three. No way.
14:20 Right. Right. Yeah. So, I mean, I’m exaggerating maybe. Not not No, you’re not. Because of
14:25 I think we’ve seen it actually. You’ve seen it. Like, like these guys want to add back all this that they’ve been trying to avoid paying taxes on. You’re like, “Hey, look, you
14:32 got you already got the bonus treatment. You didn’t pay taxes on that. You’re not also going to get now a three times,
14:37 four times multiple on that adback. I’m just not going to do it.” Uhhuh. Yeah. Well, no. I was curious just to kind of
14:44 take a step back, you know, to your earlier statement about kind of like a brain drain type scenario that a lot of
14:49 people don’t take into consideration, especially like the the the older gal or or guy that just wants to get a bag of
14:55 money and and go off of the sunset. I think that’s always kind of the fallacy, you know, um especially if you are kind
15:02 of the you the the sun, the stars, and the and you know, the moon in this this little universe of a business, right?
15:09 How how are you consulting or you know I guess giving people options you know
15:15 business owners that is to to try to divest themselves from from that scenario right are there are you saying
15:21 hey you should bring on a GM train that person ahead of time like what are some of the is if you’re a business owner
15:28 listening to the to the podcast like what are some of those suggestions to to avoid those scenarios right
15:33 when we put together a plan for an owner it usually takes six months to do it so there’s a lot going on in there. I mean,
15:39 part of that plan includes um a personal financial plan for the owner and the spouse. If there’s multiple owners, obviously there’s multiple plans going
15:45 on there. Um one of the big problems that I think probably one of the biggest overlooked issues we run into with sellers and and
15:52 this is the opposite of what you two mentioned earlier when you say that, you know, you get these owners who want to just, you know, they sell and they want to bounce like the next day. We do run
15:58 into issues with owners that are like, “Oh man, you know, what am I going to do now?” Like this is I call it around.
16:03 Yeah. It’s like life after football, right? You know, I played football my whole life. I’m done. you know, average what, NFL 3.8 years, something like
16:09 that. Maybe it’s less than that, but now what am I going to do for the rest of my life? So, even if you’re selling your company at 60 or 70, I mean, you still
16:17 got life left and and you’ve been, you know, working in that company, your baby, for many, many, many hours a week.
16:22 So, you have to know what you’re going to replace that time with when you’re done. That’s a great point. That is a great point because I even think in the sales
16:29 process, right, for a buyer, there’s a point where the seller stays
16:34 on too long. Yep. So there is I’m just saying like we have example of that too
16:39 but but it’s again it’s there is like these are real things you know and so while you’re guiding them on hey what
16:45 are you going to do next right we going through the sales process we’re also needing to understand what is the how
16:51 long do we want this person on right yeah for sure yeah but aside aside from the personal planning for after you know
16:57 life after football as I called it the other part is the the business side of it and again trying to get them out of the business I try to get them I try to
17:03 very early on get them to understand that You’re going to have more fun. You’re going to have more free time. You’re going to be more profitable. The
17:10 company’s going to have less risk. Your staff’s going to be happier. And your enterprise value is going to be higher
17:15 if we do all these things to remove you. Not completely remove you from the business, but because I think many owners like that the business business
17:22 depends on them. It gives them a sense of purpose, but um but then I want to get a fractional CFO in there um if they don’t
17:28 already have a CFO on staff and then take that plan and hand it to, you know, that fractional CFO or their CFO. U
17:34 maybe get a value adviser in if there’s already a CFO in place. I think we need a value adviser, somebody who understands the planning process and
17:41 then just kind of get them understanding that look, this is this is your company, but again, kind of tying that into
17:46 what’s going to happen when they’re when they’re done, when they exit and right off into the sunset, there’s got to be something to do. You can’t just say, you
17:52 know, um like this one owner, you know, I’m going to I’m going to move to uh Colorado. We’re building this house. You know, my wife and I are building this
17:58 dream house. It’s like, what are you going to do in Colorado? Well, we’re going to, you know, hang out at the house. You know, it’s like it’s awesome.
18:03 Have you seen the house? They want to show pictures. Like, yeah, okay, but what are you going to do there, though? And he go and he gets mad at me, you
18:08 know, and it’s like, look, you I’m not I’m not trying to frustrate you, but you can’t you going to sit around the house all day? I mean, yeah, you got a nice
18:16 pool, but I mean, how long can you sit around in a pool? And especially in Colorado, you ain’t going to be using that pool at least, you
18:22 know, eight or nine months out of the year. Touche. Yeah. No. So, I mean, I guess so, what you’re
18:28 suggesting really is like it’s a two-pronged process, right? It’s it’s you know how do we kind of get them
18:34 comfortable with not being the sun, the moon and the stars, right? First and and I guess the the the
18:41 pitch to them is like, hey, the value is actually going to increase. Yeah. Right. Because you have set these pieces
18:47 up in a way that’s more scalable for the next guy or gal that’s going to buy the company. That’s where that psychology major
18:52 starts pulling in. I know, right? He’s playing he’s playing that part. No, because I love him. Right. Because
18:58 you really need to you need to you need to and I think this is one big thing too, right? To to to kind of take a
19:04 point here. People need to be planning this out one two three years in advance, sometimes even longer depending on what
19:10 the what the scenario is. And I think that’s the problem is that people think that they could just flip a switch. Oh,
19:15 I’m just going to go now. I’m ready. Well, no. you should have been planning this out for the last year or two,
19:21 bringing these people in, getting the evaluations done, cleaning up your books, you know, and review the
19:27 financials. Yeah. Because I think the other thing that I noticed, too, and and correct me if I’m wrong, when you’re when you’re reviewing these financials, is not only
19:33 are they doing a lot of personal expense stuff, but they’re they’re just trying to load up so they so they don’t have to pay taxes, right? And really what
19:39 they’re doing is they’re shooting themselves in the foot. They’re not running, you know, they’re not running it like a business. They’re
19:44 working they’re running it like they’re an employee of their business. Yeah. They’re trying to they’re trying to minimize their tax exposure, but what
19:50 they’re ended up doing is they’re they’re they’re lowering the potential value of their company, right, by doing
19:55 all of these things. And more from the perspective of a buyer, they’re the buyer’s not going to want it. I mean,
19:60 they’re going to they’re going to be a less attractive company. I realize that, you know, yes, the value goes up, but that’s not the point. The point really
20:05 is it doesn’t matter what your company’s worth if nobody wants it. Yeah, that’s true. And I think one of the if one of the things here for our
20:12 listeners is if you do not understand the psychology of the person that you’re buying their company,
20:17 you’ve got to understand what they’re going through on the other end, right? It’s it’s there’s there’s a
20:23 tremendous amount of of care and love in their business. And now you’re talking
20:29 to them. You’re they’re about to go through due diligence and tell them that their baby’s ugly, right? Yeah.
20:34 It’s a big thing. And so what do you do, Adam, to find these companies? How are
20:39 you sourcing business owners? Because it’s the same it’s the same way that I’m probably trying to source them myself,
20:45 but so how are you getting to them? And then what is that consultive selling process to get to the table with them
20:51 because I think it’s the same exact thing we do? Yeah. The le I mean when it talks to you know how we meet the first how we meet
20:57 anybody to begin with. Um, I mentioned that in, you know, COVID, I I read this book and it said that 80% of businesses
21:04 dissolve and blew my mind. And then it also said that 80% I’m sitting here, I’m a business owner, right? Um, I’m sitting
21:10 here reading that it says 80% of your net worth or the business owner’s net worth is tied up in their company. I’m
21:16 shaking my head. I’m going, “Yeah, it sounds about right.” And then you hear that 80% dissolves. So that means 80% of
21:22 owners who have 80% of their net worth in their company lose 80% of net worth. And then of the 20% that sell, roughly
21:29 75% sell for less than market value, right? So, you know, when I’m when I’m looking at
21:35 this stuff, I’m I get pumped up about meeting new people to share this information with them so they don’t make the same mistakes and they don’t become
21:41 a statistic. So, and during co when I read this book, I I decided I got to figure out how to find these people and
21:47 it’s not easy like we is there a harder person to get in contact with than a business owner, right? So,
21:53 I am one. So what I did was I started another company that’s elevate and exit. Um and I started doing events. At first
22:00 it was inerson events, probably 10 of them throughout the year. Then we realized we we could have a bigger reach
22:05 if we just did them virtually. And then they could live out there forever. So we started a podcast. We do webinars and um
22:11 you know we do some events just a couple events locally now. And then we I built a kind of revised my network of centers
22:18 of influence. So you know corporate attorney, M&A broker, couple of them. um um business banker and then you know got
22:25 them all involved in these events um did things like this you know like a podcast just like you’re doing here and it the
22:31 goal was really it wasn’t to sell it was to again educate bring awareness and and let people know hey you know you can’t
22:36 just kick this can down the road and then when we get to the table um which happens a lot it’s I’m again I’m not
22:42 trying to sell I’m just trying to educate and because some of the owners aren’t ready to sell literally it’s like look I’m not selling for 13 years but
22:49 and my only goal then is to like Again, kind of like we were saying earlier, explain to them that look, it doesn’t matter if you’re selling 3 years or 13
22:56 years from now, what matters is you do this planning now, and I don’t I don’t mean to use CrossFit as an example, but
23:02 you know, the one of the models of CrossFit is be ready for anything any time. I mean, if if you’re running a
23:08 great company and all of a sudden you just get a you have some competitive buyer that comes up and says, “Hey, I want this thing, you know, I want to buy
23:15 this this year.” And then you’re embarrassed to get the books out. That’s your fault, you know, and you’re going to and leaving money on
23:21 the table. I think that’s a big that’s a big part of like what’s happening is just these people are just not prepared,
23:27 right? And I think you brought up a really really good point that I want our listeners to understand like, you know, if you’re a business owner,
23:34 run your company like you’re going to sell it at any point. You know, not like, oh, I’ll get around to that in
23:40 three years or I’ll get around to that in five. Why not do it now? Because you never know if you’re running a great business, especially right now as we’re
23:47 starting to see a lot of buyers in the space. private equity is getting bigger and bigger. They’re coming down the stack in terms of buying smaller
23:54 companies. So, like if you’re a business owner listening to this podcast, the takeaway here is get your get your
23:59 affairs in order now because even if you say you’re going to do it in five years, what if, like Adam said, what if
24:04 somebody comes along and offers you a big old bag of money and you’re you open up you open up the books and they’re like, “Well, actually, we’re going to
24:10 rescend our our offer because, you know, it’s not worth what we thought it was worth.” No, thank you. Yeah.
24:15 You know, you got a big egg on your face. Yeah. So I think that’s that’s a big takeaway.
24:21 So in your process, right, so you meet with these sellers, you’ve got this events, you’ve got these activities, you’re doing these things.
24:27 What I’m taking away is a little bit how I sell and I’m and really it’s consultive selling.
24:32 Yes. Right. So we’re not we’re not I’m not here to buy your business, right? I’m
24:37 here to to learn about it. I’m here to see if there’s a fit. Is it right? Is it good fit? That’s exactly right.
24:43 And it’s consultive selling. And so for those that are out there, if you haven’t go, there’s plenty of books on how to be
24:48 a consultant selling, but it’s having those things. So where I also like to focus on, and maybe you hit on this,
24:53 too, is the tax side. So I’ve always learned in my conversation, I’ve got a
24:58 couple little like things that I say over and over again, but as I get deeper into the relationship, I start talking
25:04 about taxes, right? That you know, are you familiar with what your your your
25:10 what you’ve depreciated over the last few years, right? There’s a thing called accelerated depreciation. And it usually
25:15 these guys are like, what? You know, and you’re like, yeah, you’re like, if if I buy your assets,
25:22 you’re gonna have to pay back your depreciation or percentage of it. Have you done an analysis? Have you thought about it that way? And so then I get
25:28 into this conversation of like, hey, why don’t we, you know, so it it takes the now I’m now, and I’m not doing this to
25:35 they really need to know, right? because but on my side there might be a way for us to structure it where they don’t have
25:41 as much tax burd right we just may not pay them as much so on my side I’m learning these key
25:47 things but I like the tax conversation and my consultive selling that’s that’s kind of where I like to go
25:53 um do you guys get into the tax conversations with these guys I mean is that I imagine it’s like a monster part
25:59 of once they’re like hey I want to sell you’re like well then hey what is your tax going to look like?
26:04 Yep. No, we kind of act like we kind of act as the quarterback. Um, you know, we’re obviously not CPA’s pier, but you
26:09 know, we get a CPA involved. Uh, we get the M&A broker involved. We get a TPA involved a lot of the time. So, like, as
26:15 an example, you know, we’ve got a company who technically it’s two companies. He’s spinning one off and
26:20 selling them the two separately, and then he has real estate as well. And what we’re doing, originally, it was one
26:26 of those situations where he says, well, you know, if if it’s um, and I’ll just use the right like dates here, we’ll say
26:32 it’s summer. Um, he says, “I want to sell at the end of next year.” So, end of let’s just say I want to sell at the
26:37 end of 2026. And I said, “Okay, well, have you filed your tax return yet?” And he says, “Well, not yet.” And I said,
26:43 “Okay, why don’t you wait to sell until January of 27 and what we can do as one tax
26:49 reduction strategy is a we can set up well, first of all, we can max out the 41k for him and key staff. We can do
26:55 profit sharing, max that out, reduce taxes today. We can set up a cash balance plan and based on his age, he
27:01 could put away somewhere in the ballpark about 3 350 per year tax deductible per year. So he could do it for 24 in this
27:09 case cuz he hasn’t filed his tax return yet. He could do it 25, he could do it for 26. And if we sell in Jan 27, we can
27:15 do it again for 27. And his cap gains tax, if it’s cap gains, aren’t due until
27:20 April of 28. So we can So that’s an example of one very common strategy that
27:25 we use when we’re on the other side of the fence. Obviously, I’m working with a lot of sellers. Um, so we’re we’re kind
27:31 of looking at the runway and saying, “Okay, how can we extend this runway out a little bit in a way that can help reduce not only our income tax now, but
27:38 try to minimize or at least mitigate taxes that we’re going to have to pay when this thing’s all said and done, you
27:44 know?” So, so that’s that’s an example anyway. And and it’s probably shocking how many of these guys, they’ve never had this
27:50 conversation before. Nope. I was talking to an owner literally last week who um owns a
27:55 remodeling company. They do uh I don’t know what their average ticket is, but they do almost 300 remodels per year. Um
28:03 that’s a lot. And he’s got him and a partner and a great team, very successful company. He’s 55 years old.
28:10 And I he was talking about taxes and he says um I was like, “Hey, so what’s your how’s your retirement plan set up?” I was like, “I don’t want to step on any
28:16 toes, but you know, how’s your retirement plan set up?” And he says, “I have a simple IRA.” I’m like, “A simple?” So he can only put away $17,000
28:22 per year. for all these years he’s been maxed out at deducting his income by 17
28:28 grand plus a 3% match. That’s it. So there’s there is great smart hardworking
28:35 successful people out there that are just getting maybe the not best not the best advice in the world. And something
28:40 I wanted to say earlier was that um when when we’re talking about all this stuff, I think a big question that comes up
28:46 especially with buyers but sellers as well is okay this is all great guys but how do you do it? And the answer is hire
28:53 people. Hire help because and I’m not talking about me necessarily. I’m saying, you know, hire the corporate
28:58 attorney for help. Hire the uh you know, talk to a business broker. Um talk to someone like you guys. You know,
29:04 somebody who knows more than you do because you can’t sit around here and and think that um by going it alone,
29:10 you’re going to save all this money and that, you know, you’ll make more in the end. Because in in reality, whatever you pay for all the professionals you hire
29:16 to help you figure out how to get out of this this uh cycle, this death cycle of
29:21 being an employee for your company, minimizing your taxes, keeping your profits low, all that stuff, ending up
29:26 with, you know, amortization issues, with recapture issues, the if you if you don’t hire people, then I think you’re
29:33 going to end up with less at the end of the day. And honestly, the buyer is going to get get a great deal.
29:39 Yeah. No, I mean, I think that’s right. You always have to you have to invest in these people around you, your team,
29:45 right? You know, so I mean I don’t think and I’ I’d also say, you know, I mean, it goes back to your earlier statement about just bringing in folks that can
29:51 kind of potentially run parts of the company without you being involved. A lot of people are they I mean we’re
29:57 all type A as an entrepreneur like I’ll just do it. I’ll just do it. And you end up doing five people’s jobs, right? And
30:03 then you’re probably doing five people’s jobs not all that well either. Yes. Right. So, I mean, we’ve seen it on negotiations where, you know, we had a
30:09 seller and, you know, I mean, he was trying to poor boy the thing and didn’t have a lawyer at first and we finally
30:15 got to a point we’re like, we can’t have any f further conversations with you until you you get a lawyer involved,
30:20 right? Because he was just wasn’t picking it up because I think what people realize is like some of this stuff is like and and we’ll come up, we
30:26 know how to structure deals, we know a lot about finance and taxes and all the other things. A lot of these folks don’t
30:32 and then they kind of they they kind of get turned off because they think that you’re trying to talk down to them or they get they get really they kind of
30:38 get, you know, protective or defensive because they don’t understand it, right? And so I think that that’s where like
30:43 again as a seller or a potential seller down the road, not only getting your house and, you know, in order, get a
30:49 team involved, but also just getting yourself educated on how the sale process works,
30:55 right? How could a how could a potential sale work, right? You know, because a lot of this stuff is just lost on
31:01 people. They might be the smartest guy when it comes to running that company and they’ve been very successful for
31:06 decades, but they have just never sold a business before and they just do not know how it works.
31:13 Talk to the experts. I don’t know if you two are Dan Sullivan fans at all, but I’m a big Dan Sullivan fan and I live by
31:20 the whole um unique ability, you know, where the only thing I should be doing in my business was what I’m uniquely
31:27 born to do. You know, what I’m best at. And then right along with that, his whole not how concept, you know, you
31:32 don’t need to learn how to how to do something else. You need to hire more who’s like get get another who.
31:38 Yep. Yeah. I worked at a private equity firm and that’s what uh Tom had always said to me. He was like, “It’s who, not how.” And so we did the dance, we did the
31:44 Sullivan stuff. It was it was really good. I’m a quick start, by the way. Um, that’s that’s my personality type. It’s
31:50 like full extreme quick start. That’s me, too. That’s me. You’re like, you know, my wife’s like,
31:57 “You’re ready fire aim all the time.” And I’m like, the other day I was like cranking the generator and stuff and she’s like, “You
32:03 haven’t turned it on.” And I’m like, “Shut up. If I crank it, I’m I’m just getting it
32:09 ready. I’m priming it.” Yeah, that’s funny. Oh, that’s great. So, kind of as we’re
32:14 getting getting to wrap it up and all that good stuff, talk to us just real quick, you know, for the people our listeners, majority of them are in that
32:21 process to not they probably haven’t even met with their first seller yet, right? They’re thinking about it. What is your, you know, and I know we talked
32:27 about consultive selling, we talked about these things, but from a psychologist kind of mentality, how
32:32 would you advise them to get in contact when they’re talking to them and how to guide to at least to where they can get
32:38 a really good successful first meeting? We’re talking about the buyer, the buy side. Yeah, the buy side. The buy side. I would say that I would say um make a
32:45 list of of the companies you’re interested in. Um if you don’t know who those companies are, there’s websites,
32:51 there’s people like you to help. Um there’s business brokers. Um make a list
32:57 and put together a template email. Um use find their emails either on your own
33:02 through their websites or use a an app like hunter.io. Apollo is another good
33:08 one. uh use LinkedIn to find them. So build the list out first, build your template out first and just start
33:13 banging out the emails and offer to buy them lunch. Everybody’s got to eat, you know, coffee is probably less likely,
33:19 but buy them lunch, happy hour at the end of the day and just and just come in with the intention of talking. That’s
33:25 it. You know, it’s it’s come like I’m not looking to, you know, come in here like a bull in a china shop. I just want
33:31 to learn about you, understand your business. Worst case scenario, I’m going to learn something and um you’re going
33:36 to get free lunch. You know what I mean? So, um I think coming from a passive kind of modest standpoint where you’re
33:42 just trying to plant seeds out there, you know, and and and different types of varieties of seeds, you know, the more
33:49 seeds you have out there, I think being being cultivated and then touching base with those people over time, um I think
33:55 the higher probability you have of finding something really special and then, you know, business owners know
33:60 other business owners. So, they might know someone who’s interested in selling that um maybe they’re not ready, but
34:06 maybe they know somebody who is and and it would be a great time to make a connection. But the biggest thing I would say is there’s so many people out
34:12 there, business owners like um and people looking to buy businesses that um
34:17 can analyze and overanalyze and reanalyze and plan and replan and redo the spreadsheet, but you you can have
34:23 the best list in the world of companies you’re interested in, but if you if you don’t go out there and like relentlessly execute, you’re not going to it’s not
34:29 going to happen for you. So, you got to do the work. Yeah. Got to do the work, man. There is no there’s no way around it, right? And
34:35 sending one email is not going to get you the answer, right? But but but pretend like don’t treat it like it’s sales. Treat it like you’re
34:41 going out to hang out, you know? I think that the best deals are made by people who meet and become friends first.
34:47 Yeah. You got to like, know, and trust. I mean, that and that even happened. It doesn’t matter where you end up in the the the buy side process or where you
34:54 end up finding, you know, potential sellers. It’s all about making that connection, building that rapport
34:60 because again, we talk about like, hey, this is their baby. They’ve been connected to this baby for maybe 30, 40
35:05 years in some cases, right? They want to make sure that that baby’s taken care of p, you know, post acquisition or post
35:11 sale. Yep. Right. And so, they’re not going to just do that with somebody that they don’t like. You know, I mean, there like I there’s
35:17 been so many times we’ve talked to potential sellers where money is really not even the top factor.
35:23 Yeah. you know, tax planning in a lot of ways. Some they want to make sure they’re they’re going to net the most money. But also, I think most of the
35:29 time it’s legacy, taking care of their team, you know, what are the future plans for the company? Like, are you
35:35 guys going to try to grow it? You’re going to try to modernize? Are you going to do other acquisitions? That’s what
35:40 gets them excited. They want to see that you’re going to grow their their their right. Some of the coolest deals don’t end with
35:46 a handshake at the table, you know? It ends with a hug. I mean, that’s that’s pretty cool. I love that. I love that. I like that.
35:52 And and I am a hugger. Um so be careful. Ready. All right. So ready, hire, ready, hug, aim. Yeah.
35:59 Whatever. Hey, whatever it takes. Honestly, I if you don’t like hugging, we’ll we’ll just dat, you know, whatever, you know.
36:06 Awesome. Well, Adam, it has been incredible to hang out with you today and learn more. Um
36:12 we’re going to jump right now into our rocket round and this is where we ask our guest three what I think some of the
36:17 most important questions. I think I’m ready. Go ahead. All right. Well, here you go. So, first question is, what do you like to do in
36:23 your free time? Oh, right. Um, in my free time, uh, my
36:28 wife taught me how to play volleyball and we play we’ve been playing sand volleyball every Thursday night for 18
36:34 years. Wow. Okay. For every yearround, even indoor. So,
36:40 um, it’s, uh, it’s not my chosen sport, but it’s a good time. It’s good exercise for a 46 year old. And, you know,
36:46 good bonding. It’s a good time. It’s good. I like it. I like it. I like it. All right, next question, man. Most
36:53 memorable moment in your business journey. Most memorable moment.
36:58 Um, uh, it was I guess it was, um, we’ve won a lot of awards and I don’t really I
37:05 don’t really take myself very seriously. Um, my wife always gets mad at me that I don’t really think too much of all the
37:10 recognition we’ve received over the years cuz I just I just don’t I don’t I don’t know why it doesn’t I know it’s important, but at the same time it’s
37:16 not. There’s other things that matter more than me in life. when we won the uh better business bureau torch award for
37:23 ethics. I would say that was probably one of many but one of the top that off the top of my head one of the top
37:29 moments cuz being in the financial industry and knowing everybody who’s listening and watch listening to or
37:34 watching this knows that ethics don’t usually go with finance very well and um to be we’re still the only in central
37:41 Ohio anyway the only financial advisory and uh exit planning firm to ever win that award which is pretty cool. So
37:46 that’s that’s exciting. Congratulations man. That’s also huge. It’s huge. All right. And last question here is what is your favorite tool or resource?
37:53 Oh, man. I wanted I wanted to be unique here, but Chad GPT, man. Chad GPT,
37:59 Claude, they’re my best. I mean, I use I don’t even use Google anymore. Everything is Chad GBT. It’s it’s
38:07 the buzz every I mean, I’ve been to a lot of events the last couple months. I think everybody’s using it for one way, shape, or form.
38:13 Yeah. So, you know, No, you’re not the first guest to to say chat GBT, but I think, you know, people, it’s all about the
38:19 prompts, right? You got to have the right prompts. Hey, and I got I just got my plaud, so I I’ I’ve got to set it up, but I’m I’m
38:25 I’m excited about it. Yeah. No more note takingaking. That’s right. Right.
38:31 That is awesome, man. Well, Adam, how can people get a hold of you? If you look up just my name, Adam, last
38:36 name spelled K O S K O S. You can find me on LinkedIn. You can find our podcast. We also have podcasts that we
38:43 run. Maybe we ought to have you guys on actually do a home and home. Um, but th those are probably the best ways. You
38:48 can find the the website for uh our exit planning company is elevatedandexit.com. Um, and then libertaswealth.com for the
38:55 financial advisory firm. Awesome. We’ll put those in the show notes as well so people can reach out to you and get some more information.
39:00 Yeah. All right. Cool. Cool. Well, thanks again. No, no, a lot of great valuable information today. You know, we wanted to we wanted to thank
39:06 you for being on the show and you know, thank you for honoring me with you with allowing me to be on the show. This is you guys are doing some really really
39:12 impressive stuff. the conferences. I’ll definitely I’m going to definitely try and make it to the conference next year. This one in Chicago coming up looks
39:18 awesome. I’m just not able to go because I’m speaking at another conference in Philadelphia, but but um what you’re
39:24 doing is really impressive. I think it’s really cool and um you know, I’m looking forward to seeing you two succeed. Cool, brother. We appreciate it, man.
39:30 We’ll talk to you soon. All right. Thanks, Adam. Thank you for listening to the M&A Launchpad podcast. If you’ve enjoyed
39:36 today’s podcast and would like to support us, please leave us a rating and review after you listen. I’m Casey Mchu and I look forward to talking with you
39:42 next week.
