Connecting Diligence and Integration in M&A

23:26Those are more helpful as well because then we can focus on more of the nitty gritty. What is needed and when? But it's all about communication. And I can't stress that enough. Like communication and transparency and just being open with those expectations. And sometimes you are going to have to follow up two, three, four, five times. But if you emphasize the why it's needed and by this date, it comes across a lot clearer than trying to force somebody to do something or dictate them to do something. Why is really important. And then those check-ins is a really good way to hold people accountable.

23:57Absolutely. How do you get people to change in general? Because I feel like every company struggles with change management in general. It's hard. I'm just going to be honest. It's hard. Because especially when people are stuck on the mindset of that's not how we always did it. And now you want to throw something new in. But one thing that really helped us is when there is a big change coming, having that champion, which I feel like is general change management, having that person be that champion or spearhead that initiative. For us, one of the biggest changes was implementing the deal room software.

24:32One thing that I've spoken on before to several other people in the industry is you have to have that champion. You have to have that resource, that person that knows it, that's going to be there for your people when they have questions. If you're just telling people to change without how it's going to make an impact, what it's going to benefit. You're not going to get the result that you want because people need to feel empowered. They need to feel some ownership in it. We need to listen more. We need to explain what the impact is. And something that I like to ask my team every week is what impact have you had on a partner this week?

25:06You or your team? That's what we call a lot of our deals or partners because some of them are partnerships. And it's really fascinating and encouraging to hear what they say and what they've done or what their team has done. You have to capitalize on that excitement because that will take you so much farther than anything else is when somebody feels that they are making an impact. Were you the change champion? I was the change champion, in case you can't tell. That's a really good point. Time after time, I feel like that's especially the bigger the company, the harder it is to drive change. Yeah.

25:38You get new employees in all the time and people change positions is part of it. And so if they know they're coming into a solid team and they're going to have that impact, because that's what's already lived and breathed, it's culture. And that's your culture that you foster and you live by, then it makes things a lot easier. I was always curious about that. When you get new people in a role, it's, are they going to try to act on some real changes and demonstrate value creation or do they try not to and just come along with what's already there? It could go either way. It does because I've noticed that.

26:11It can go either way, but I like to empower people to have the opportunity. They need every opportunity to instill change or try to create value. And if they don't take it, if that's not what they like to do and they want to go through a checklist, then you know what? More power to them if they know that. But I think we should give people that opportunity because, my gosh, I don't see everything. I don't know everything. I will be the first to admit that. And there are people on these teams that know more about certain topics. You know what? Let's bring it to the table. You're saying I was thinking like there's such a cliche thing that's so true in our industry.

26:46Why fix it if it's not broken mentality? Runs rampant. I can't tell you how many companies I come across of it. I've been doing this for 20 years. And why should we change? Oh, my gosh. Yeah. when I first started, it was, that's not how we've done it. I'm like, we're not the company of yesterday anymore. When we're doing 20 deals a year, you have to have your ducks in a row and have those foundational building blocks in place. And that's one thing that I always stress to other people as well is take time to create that foundation. If you do not, your cracks are only going to get bigger as you start to do more deals over and over.

27:20You have to create that solid foundation first. With that, and now that you're managing the end-to-end process of eminning your company, What advice can you give to people who have the same role as you? What I just mentioned with building that foundation. If you have to take a small pause to create that and to start from the beginning, then do that. Your policies and procedures have to fit the company's strategy and the vision. So especially for smaller companies, you really need to have that communication open. But build those foundational blocks and still transparency and communication. because if you're not on the same page, you're never going to get through to the end.

27:56And then it's only going to cause frustration on every end, internally and with the acquired team. You definitely don't want that. And you want to just be as open as you can, but also be realistic in the sense of you are going to have to pivot. You are going to have to stay agile. It's not going to be the same for every deal. So even though you have your template and you have your playbook, it's going to have to change. And that's okay. Every deal is different. You adjust and you keep moving forward. I want to give like our theme because we kind of have this why. We have one team, the communication for accountability.

28:28We have the parallel process. I feel like that should be part of it. Yeah. Maybe it's just bringing the integration in early. Maybe it's just part of one team. I don't know. You can frame that under the one team umbrella because you're under one team. You can run those parallel work streams and support each other as you move through the process. Let's be honest. There are integration teams and individuals and team members that will come to me and be like, okay, during the deal, did you ever discuss this? During the deal, was this expected? During the deal, was this learned? Those kinds of items.

29:07So I want to recap on what we covered so far. I want to make sure we're getting the right steps in. This is for teams out there that may have a disconnected process or just want to optimize and connect their diligence integration together. First, that clarity on why. I think that's so important. Just really why we're doing the deal. And that's something that can be effectively communicated across to everybody that's involved with the deal. This one team, getting not only the mindset, but structuring so that the team is acting and operating as a single team. And within that, because you've got the one team structure, this is when you're enabling much better communication having these meetings or information's distributed amongst the parties involved and having that accountability we also talked about parallel work streams but now we're getting better transparency access to information for those that need it when they need it not too late and then we talked about also just recalibrating that hey if you need to take a break to recalibrate your whole process one of the things i really liked is that you emphasize of just talking to your team members of what do you need?

30:12Really taking that break to be able to do that. That gives you a lot of insights in how you can optimize your process accordingly. Was that everything? That was everything. That was a beautiful summary. I got to ask you, being a newer practitioner in the field, one thing I love is that there's something to learn from everybody. And in some ways, I feel like you can actually learn more from those new in the industry because it's so fresh in mind that they actually know like the order and wish to explain things and so forth. What's helped you? And I mentioned reading the book and stuff like that, I think there's only so much you can learn from a book.

30:42But what's helped you to get to the level you are so fast? Networking, talking to people, asking how they do things. Because while we may not do things anywhere remotely the same as a large software company, because they've been doing it for so long and they have their processes and playbooks down to a T, but then they also have some of the similar challenges. It's learning from others, even in different industries. You can take what worked best and start to build upon those best practices. But not just that, but doing your homework, doing your research, really starting to understand the different perspectives and different sides.

31:23So you can build those best practices in that playbook for yourself and what fits best for your company. I want to talk about the networking part. I'm big about the networking piece. I wish I focused on it more earlier in my career. And in fact, any opportunity I get to speak to undergrad and grad students, that's my number one biggest emphasis is networking. I still think every school lacks teaching that as well. What was your journey like and how did you start approaching it? What got you to do it? It's my desire for learning. If I could be a full-time student, I would, but I can't. For me, it was a lot easier, but it wasn't just M &A networking.

32:00It was different business groups or then insurance specific. but it's really just getting out there more and more because in the insurance industry and sector, like I mentioned before, every medium to large size broker does M &A. So you're going to run into somebody. One of my good friends works for another brokerage and she just did her first deal and she just happened to be thrown into it. I got to coach her through some of it. And then she also got to teach me some things on how it worked. But then my husband just went through a deal as well. His company got purchased. I was then learning from his new company, how they did certain things, but then also with his team as well.

32:37And so it's really just finding that knowledge in every place that you can. And it's not just going to be from a book or it's not going to be just from a newsletter or what your company tells you of this is how it needs to be. Go do your research, explore, and then bring it back and shape it and mold it to what your company needs to fit that vision and that strategy that your company holds. You had it beforehand, just generally coming up through the insurance industry but now in M &A, you even take the same networking approach with other practitioners. Absolutely. Which is why I saw you at the M &A Science Fair.

33:12Are you part of the M &A Science Women in M &A Roundtable? I am. It is by invitation because we want to keep it a peer group. Yeah. One of the things I'm working on is a talk track I'm going to do early next year with our friends at Grada around optimizing roll-ups. And I want to come up with a variety of different approaches to help these earlier stage roll-ups mature their M &A function faster. We always see that an early stage roll-up starts emerging. They pick up and sometimes they don't even have a formalized deal team. Then later on, another PE firm buys them. Then they start building a small M &A team, increase the volume of acquisitions.

33:54Then down the road, they get acquired by another PE firm. And then they're making it even bigger, putting some more processes, software in place and things of that sort. But looking to create a talk track to accelerate maturing an M &A function for a roll-up. I think the opportunity in the market is, can we bring just a playbook really focused on maturing that M &A function for a roll-up specifically? Because it's unique. It's a unique scale. We're working with one of our clients that's doing about 300, 400 acquisitions a year globally. And it's really interesting, right? Because you can work with these large strategics, but now you're working with these very large-scale roll-ups.

34:29I want to learn from you. What do you think are ways that you can optimize that? Because you've already seen a level of that maturity. One thing that's been significant to see with our maturity is how we've changed our M &A strategy based on our company goals and vision. So those two pieces have to align. Well, we don't have to pick that one specifically. we can always pick up diligence in terms of specific improvements there or opportunities if you want to optimize diligence. The way we optimize diligence is learning from the past. And that's one thing that we really try to focus on and grow as we do each deal.

35:10What did work? What didn't work? Did we maybe miss something or did we do too much of something? Or was this exactly what we needed? We go into the deal knowing why we want to do the deal. So diligence is, in a sense, try to find a reason why we shouldn't. And if we don't find a reason, beautiful. That's the goal. We don't want to find a reason. But sometimes, since I mentioned every seller is different and every deal is different, you have to learn from the past because 10 deals ago, which maybe it was two months ago for us, we had this particular similar situation. We can learn from that and grow on that and build that.

35:44But you also have to engage the right teams, even if it's an external team doing your financial due diligence or a bank or somebody of the sort. You have to engage the right teams that understand your vision, your strategy, your company. So they then can also mature their due diligence function and their requests and how they're going to handle things as well. From the buyer's side. From the buyer's side. And when you think of learning from the past, I feel like that's a nice theme. But then how do you actually do it? Because a lot of people will do these meetings, they'll do a retrospective. They take a bunch of scrupulous notes, And that's the end of it.

36:21I'm going to go back to my theme of communication and hearing the teams when it comes to how we learn from the past. You have to bring that in as well because what may have felt broken to one team may not have been felt to other teams. But in reality, it does impact everybody, especially on the integration side. So therefore, you have to learn from the past of what caused that breakage. You have to listen to your team so then you can reformulate and mature your due diligence process or your core dev team and what they're sourcing and how they're sourcing. So you have to keep that communication open and really start to look at those lessons of why this didn't work or why this did work.

37:02But I guarantee you in a lot of these industries and a lot of these companies who have challenges with integrations, there's a lot of what did not work. and you can't just fix it within integrations. It has to be brought into the deal team. It has to be brought into the corp dev team. And sometimes if you're a smaller company, it has to be brought to the executive's attention as well because that's sometimes who's sourcing the deal. You may not have a corp dev function. So you have to be open and transparent with the entire process, not just one. I really try to focus on teaching our corp dev team what integrations is and how it works.

37:36So then not only can they have knowledgeable conversations, and answer questions. But then they can help set the seller up for more success by setting those expectations early. I like it. You know, I can almost reframe that again. We have a learning lesson from the past and then you got the theme of like, basically listen, learn the lesson, echo it so all the teams learn it. Yeah. Can't stay siloed. One of the things I was always curious about is like you build a process out because the unique thing with roll-ups is you're doing a high volume of acquisitions. Keeping your team, is it purely muscle memory?

38:08And if it's muscle memory, you have people move on to different roles or different companies. How do you sort of not lose your rhythm? That can definitely be a challenge. And when you're doing 20 plus deals a year with a relatively small team, yeah, sometimes you have to put that muscle memory in place. But I always encourage the teams to really, especially post-close, really get to know the seller and really get to know that owner of that agency. So therefore, it brings a different side and a different perspective into things as well. So it's not just, oh my gosh, okay, here, Mr. Smith, I need to go through a checklist of 10 items.

38:47It's let's learn, let's analyze, let's try to find those synergies, let's dig deep. And each team is going to find different synergies. Each team is going to have different topics they want to talk about. And again, empowering your team to look beyond the checklist or look beyond the template is what really helps keep them engaged. Yeah, that's a really good point. Teaching them like the real heart of diligence, the out-of-the-box thinking. Yeah, every deal is different and every deal is going to be different. So a checklist isn't necessarily going to work. It may work for some items of let's order computers or let's do this or let's do that.

39:22Yeah, there are some of those items. But again, you have to really dig deep sometimes. And that spurs my excitement. The deeper I dig and the more we can learn about efficiencies, our integrations manager has an incredible background in agency operations. And so she can see where there's inefficiencies like no other, and she can call them out before anybody. And so that enables her to then set up the teams of, hey, we're going to need to focus on this and this. Just based on this 10-minute conversation I had, I could tell you all these things. It's really utilizing those team members that you have in a different capacity sometimes than what they're used to really helps keep things interesting as well.

40:00Yeah, I like that. And you got any other tips and tricks for me? How do I not screw up my integrations? You're going to. And that's fine. It's teaching your team to stop and recalibrate if they need to. Because if something starts going off the rails, that's going to happen. And that's okay if it does in the sense of don't let it keep going. Know when to stop. Okay, let's get together collectively. This is what happened. This is how we need to pivot. This is how we need to change things. Again, keeping that agility in what you do is going to be huge as you start to do your own acquisitions and your own integrations.

40:36Knowing what the end goal is. And oh my gosh, define done. It's one of the biggest things I can stress to is define done because the teams want to understand. The target wants to understand as well. What does done mean? What does integrating look like or integrated look like? So you have to define done, but then define that, again, autonomy versus integration of how much you want on each side of things as well. That's a good point. Because there's got to be a line you draw where after this milestones are met, then we're at business as usual. Yep. Are there things that you wish were asked before LOI that don't get asked?

41:11I'm curious about this because it's just, it's funny getting to LOI because you really don't know a lot about this company. And it's, yes, you look back and said, oh, we should make the checklist bigger before LOI and ask, but you can't do that. Which is hard. You can't. It just sets the wrong tone. You're going to scare someone off if you do that. So you're trying to be very respectful, trying to set a nice tone. This is going to be collaborative. We're going to make this a good experience for both of us. You got to keep it very short and concise. But then on the flip side, as a buyer, I have all these concerns around the integration side because these are the things that are going to bite me later.

41:45And that really going to mess up the deal thesis if I don't get it right. So I was just curious if there's things there that were things that you noticed. I even found the conversations around culture to be difficult and you got to learn to be comfortable to ask questions to understand culture. Yes. That's what I was actually about to go on is understand their team dynamics, who they have and what positions, not just look at the employee roster, but really try to have those conversations if possible. And I know you can't dig too deep pre-LOI, but you could probe with the right questions, but then try to understand their culture as much as you can.

42:19And again, it's so hard to do pre-LOI because then you're trying to keep it as concise and efficient and quick and get to LOI as you can. But I would say those things are going to then set you up later on, especially for the integration phase, is really trying to understand as much of that as you can pre. And when a deal is being done and somebody is about to be handed a multi-million dollar check, they're going to tell you what you want to hear to an extent. But knowing how to add some additional questions or pick apart some of their statements, that will then give you that insight. Because if they're going to be out of the picture, for us, for example, with roll-ups, if they're going to be out of the picture, Who do they have on their staff that is going to then step up?

43:01Who's going to manage? Who's going to do this? What is the culture in the office currently like if they're going to keep the office open? Is it going to fit our culture? And you'll know those things really quickly once you start to dig into those questions. And the employee roster is the starting point. And that's always something you want to get pre-LOI. Do you look at other resources like LinkedIn, Glassdoor, any of those things? We'll do that. And sometimes just a basic Google search will tell you so much. Do you get like red flags? Do your company get, hey, we see a bad culture fit and we can't do this deal?

43:34We've seen that before. It takes multiple teams seeing that and that's okay. If it's just up to one person, if you're running with a very slim team, it might be one person. They're like, oh, and that person might not fit. Again, why you need the communication, why you need to bring people in internally to really start to understand is because then you can have multiple perspectives on it. And again, I may see something in their culture that an executive might not or somebody in operations may see something in their culture that somebody may not. And I'm not saying bring all of these people in pre-LOI, but based on their answers, you'll get to feel some of those things much earlier in the process or even post-LOI.

44:12You never want to back up an LOI if you don't have to. But once you start talking to the seller, you'll start to see and learn more of those things. Yeah. What I'm curious is if I'm a deal lead, I'm focused on building a business case for this deal. And you're into working on that. The culture isn't the big emphasis of that. I know it's a thing to think about, but when you're ultimately trying to build a business case to get this deal approved, that's a very different focus. And what I'm wondering is, you have these other perspectives that you want in to understand the cultural fit. What times would you even say, like as a percentage basis, that you realize is a bad culture fit before LOI versus after LOI?

44:49Most of the time it is after LOI. Because then you're... That's what I think it's a reality. in this industry. It is the reality. If I could have it my way, I would do more pre-LOI. But again, that's not reality. It's just the nature of the game. But there are certain times and certain cases that we do find that pre-LOI, especially when more executives will get involved because the bigger of the deal, we'll have more executives get involved. And that's great because then, again, they can see those different perspectives pre-LOI. If you look at top reasons why deals go bad, it's always something around integration or poor culture fit.

45:20Those are literally the top two reasons. Integration failed, bad culture fit. I have barely heard of people walking away from a deal from bad culture fit. In reality, you should. I agree. I just never... You absolutely should. Because it's going to, depending on the size of your company and the fit, larger companies are going to be different than what we see and what we deal with. But negativity spreads like wildfire or toxicity does too. And so it's one of those things of you don't want that. We have a really great culture where we are and how we do things as a whole. And so we want people that are going to support that culture by having, living and breathing that culture themselves.

45:58So when it's completely different and it's no, we only pay minimum wage and we make everybody work 50 hours a week and we only give three days of vacation, those kinds of things are going to tell you more because then you're also going to see on the employee roster how short the tenure is or this and that. And those kinds of things you'll be able to pick out. But yeah, absolutely. Because you don't want a bad apple in your orchard. You just don't. I know it's just one, but you don't because it will affect every team. I want to hear more. Anybody listening has more stories of walking away from deals post LOI because of poor culture fit.

46:30I'd love to expand on that because it's an interesting one. And I feel like you're invested in the point of walking away from a deal post LOI, depending how far you're at, you've got a good amount of money sunk into a lot of people's time. You do. But sometimes that dollar amount is so small compared to what you're going to be paying to close the deal and then knowing it's going to be a poor fit after the fact. So knowing that before is incredibly powerful, knowing when to say no and knowing when to walk away. It separates good to great corp dev leads. Yes. I like the things that you address because there are more universal themes that I feel like could be adopted for anybody.

47:07It doesn't matter what type of M &A you're doing, volume or size. My other tip would be hire right. Take time and hire for the right roles and trust the people that you hire. That's going to make all the difference too. So if you're doing an international deal, hire the right legal firm, hire the right due diligence firm, hire the right whomever to then help with what you need for those specific needs. It's less than I learned in building a company up from scratch. It's so much about the people that you hire. M &A is really interesting because maybe there is like an M &A degree now. But as far as I know, there's definitely no corporate M &A degree I've heard of.

47:50I don't know of like a four-year bachelor's or master's or anything that focuses on M &A. There's programs here and there. There is. I heard of, I think Illinois has an investment banking degree that you can get. There really isn't. If you look at folks that are in M &A, they come from all walks of life. I see them from the engineering background, operation background, sales background, legal, investment banking background. What do you specifically look for if you were to say this is going to make somebody a really great fit for M &A? It's really just their experience in general. I don't try to fit anybody in a specific box based on their education, but it's their experience.

48:24If they're able to then learn, grow, transition if they want to. You can find all of those things out through the interview process, but not having a formal corp dev background or investment banking background or anything of the sort. It's, I have a bachelor's of business administration, and then I have 13, 14 years of insurance experience. That works perfectly for an insurance brokerage like ours. Because I not only have the business mindset, but then I have the insurance. I have the different facets of the insurance background as well. So I know who I'm talking to. And I understand their agency.

48:59And I understand what we are purchasing and how we're going to partner together. It's that kind of experience. I may look at somebody in operations or our SVP in operations may look to be hiring for her team and she may look at, okay, yes, you have operations experience at a different company, but you don't have insurance. We can teach the insurance piece on that. Whereas on the client-facing insurance side, you want them to have an insurance background. But then the integration manager side, the fact that our integration manager used to run an agency herself, that's invaluable to us. As we start to expand her team as well, that's what we're going to look for.

49:38The people that can float both sides with their experience or if it's needed a small facet of one, we can teach a piece as long as they have the majority. That's so interesting. I like the way you framed it with experience because it's not a straightforward answer. No. Keep referencing our own business here, but gone through the same thing where I used to always hunt down the industry experience. But that's not the biggest value add hires we've made. It's always been folks that have done something unique where they've been involved in startups, subscription software, and have scaled and been part of that growth.

50:14So now I look for that. Have you done B2B SaaS and have really been part of some exceptional growth? Because you can teach the M &A side of what their role is going to be. The tenacity, that learning to work in that kind of high-pressure environment and build and grow and then that professional development part. No. And that stuff doesn't work in our industry. A lot of the companies out there are pretty stagnant. So if we expand off of experience, we end up with these kind of soft skills, that motivation, basically. That too, yeah. You have to have that. Yeah, absolutely. You obviously have that.

50:46That's why we're talking today. Yeah. How do you get a sense of that? Do you have an approach when you meet people or you're trying to hire to get a sense if they're truly motivated or not? Get to know them as a person, not just for the role. What would you look for? What they do in their free time, what their hobbies are. Go home and watch three hours of Netflix. Exactly. Or do they get out in the community? Do they volunteer? Do they hang out with their grandma every weekend because she's in a nursing home? You can really feel a sense for who a person truly is when you, again, listen to who they are.

51:19A good leader doesn't just give direction, but they also ask the right questions. You have to know to ask the right questions. That all flows through an interview process, but it's not just, okay, what did you do during a challenging time with a project? Everyone's going to have their scripted answers because everyone knows that's usually a question, but that's not going to tell you who a person truly is. Even if you ask them, how did you handle a difficult time? It's not going to tell you who a person truly is. Get to know them for who they are and ask those right questions. What did you do last weekend?

51:50What did I do last weekend? And we not only were in Texas, we actually smoked some meat. Smoked some ribs and chicken and fish for the non-meat eaters like me. I do not eat meat right now, which is very un-Texan. I understand. But one of my personal hobbies that I work on every weekend is I started making shirts to give back to a dog rescue that I'm very passionate about and helping with. So it's a shirt that says, this shirt saves dogs and it benefits the Texas GSP Rescue. And so that's something I work on the weekends is getting the sales out there and packaging them up, making them and just promoting the heck out of it on Instagram if I can.

52:30So every dollar counts to an organization that is volunteer-based donation run. That is so ironic. We did a leadership fly-in event just a few weeks ago in Boston and we rented the conference space right next door. They had this big room and they're doing all these crafts, but it was a fundraiser for dog rescue. Oh, that's amazing. That's amazing. So funny. I love the dogs. I have a German short-haired pointer. So Texas GSP Rescue is near and dear to us. We volunteer with them, but we adopted from them. And then we also recently fostered for them as well, which fostering a dog makes my heart complete.

53:05Awesome. Well, now I know where to go hire. I'm going to go back to that. That's the dog rescue program. Hire volunteers there. if you think about the relationship part of M &A, and it's the thing that we don't talk about. If you look at all the M &A books out there, even the book I published, we don't talk specifically. At the end of the day, this whole deal is riding off of a series of relationships. A lot of times I get the deal because I spent the time to build a relationship, which is why I have this huge point about getting out there, meeting the person, going back out there to meet them again, and keep developing that relationship in a way that's meaningful.

53:43And that gives you so much more leverage, even if you end up in a competitive situation. Building that relationship with your target and having your team build it with them post-close makes such a big difference in maybe winning the deal. Like you said, it could be if you're in a competitive situation, it was, oh, we took time to build that relationship where it's somebody else. They're just a number on a list and they're just going to go down because their goal is to hit 100 deals in a year or something of the sort. And so really getting to understand that seller and really getting to know them will make things so much smoother.

54:23Because then they have trust in you, you have trust in them. And back to my M &A is like a relationship. It has to benefit you and it has to benefit them. And if you're missing one of them, you're not going to have a success in your integration. While we call it the transaction, it's not just a transaction. They're not just a number. We're not just going down a list. We are truly getting to know them and their operation and really start to analyze it from beginning to end. So we can then help them and better it for them too. Much easier to find the common ground. Absolutely. Do you have a strategy when it comes to building relationships in M &A?

54:57Yourself. Do you communicate that with the broader team of, hey, here's our approach in terms of how we're going to build relationships or specifically find our way of working with this other team? We encourage them to pick up the phone. Because so many people hide behind email and tone doesn't get conveyed right over email. Messaging doesn't get conveyed right over email. When you pick up the phone, you can then have a true real conversation and then it can sidebar into this or sidebar into that. And so when you pick up that phone, it just helps. And I know that's something we've heard for years and decades of, oh, just pick up the phone and call somebody versus texting.

55:36or emailing, but it really does make a difference, especially in someone who is already feeling overwhelmed because the deal is heavy. Integrations is heavy, especially when you're trying to fully integrate them into your company. If they and their team get a phone call from you versus 20 emails, it's going to put a much better feeling on them than the opposite. I agree. I'm glad you said that because that's something I do. And I encourage others, I feel like they look at me like I'm old school, especially my young daughter. I call her and she never answers. What are you doing? I'm guilty of it too.

56:13We all are. I'm like, let me just send a quick email real quick because I may not have time to sit on the phone for 45 minutes. But more times than not, like our integrations manager has told us of, she called just to ask one question and they ended up talking for 45 minutes. And then she learned 10 more things that are stressing them or that they need help with or that we're doing good, but we could grow upon, you know, those kinds of things. And when it comes to our deals as well, like we will also not just have our integrations meetings and check-ins with them, but sometimes I or one of the other executives will have regular check-ins with them as well.

56:51It's just building that long-lasting relationship. They will then put more trust in you and them and grow the team and they can give you advice. You can give them advice. It's not just coming from one, two, three, four people in the integration line, it's then branching out into the entire company and how we do things. I like this one. Pick up the phone. Pick up the phone. This is your strategy to relationships in M &A. People don't talk about this. And I think it's so true. The deal I'm working on, I just got comfortable to the point where in everything, I just would start picking up the phone with him.

57:22And it was so much easier. And I could tell he was a lot more comfortable in just the fact that I was coming up to him with the tough questions instead of trying to explain it over a long email. And that helps in due diligence as well, especially when you're dealing with small sellers. It might be a one owner type of place and they have one or two employees. So they don't have a team. They don't have an HR function. They don't have an IT person. And it's them doing everything. So sometimes even during diligence, it just makes them feel more comfortable. But it also gets through diligence faster of just, hey, let's go through on a phone call and let's go through these items.

57:55and then we can talk about if we need to pivot into something else or go in a different direction based on this conversation. I will do that more times than not. Okay, here, the financial part is pretty straightforward. We need your financial information, right? Finance is black and white on paper. But when it comes to the non-financial, the legal side of things, it's let's have a conversation through this. And yes, we're still going to have our requirements and we're still going to go through this and hit every point. But let's do it in a conversation versus me handing you a list of another 100 items you need to go through.

58:25Because that can be overwhelming to especially a smaller seller who is still trying to run their business at the same time. Totally true. What's your least favorite part of M &A? Having to convey bad news when we have findings like red flags. Red flags are hard because it's, is it a red flag to stop a deal? You have to decide. Is it a red flag that we need to pause it and recalibrate, restructure? Or is it something that we could live with if we adjust something down the road, But when it comes to having to stop a deal, it's hard to have that conversation, especially when you've built that relationship with somebody and their team.

59:02But those hard conversations have to be had. What's your favorite part of M &A? My favorite part of M &A would have to be helping other people. When you think about it, you're really helping the seller take the next step for them and their company and or their family. getting to be a part of that and then watch them grow afterwards is magical getting to feel that with them and experience with them I would say making that difference are you there at closing handing them a check I am not but I will let them know when it's coming which is almost as exciting this has been great is there anything else I do have another piece of advice yeah let's hear it one piece of advice especially for new people in the M &A field and new practitioners is don't be afraid to call out the BS if there's BS there.

59:54I will say sometimes if you're dealing with advisors like sell site advisors, sometimes they will paint a picture that isn't necessarily 100 % accurate because they're trying to sell their clients, sell a deal. Don't be afraid to say no. Again, there's power in saying no. But also if you got to call it out and cut it, you got to do what's best for you. It's the most important lesson because I feel like in this industry, there's a lot of people that have a big voice and a big ego that goes with their voice. They really can sound like they know what they're talking about and they could be completely clueless.

1:00:27Absolutely. And I found that a number of times. Remember, they're a salesperson too. They're trying to close their deals so they can get paid. And sometimes it's not what you need. I've been saying for my whole two and a half years in M &A, M &A is very much like a relationship. It has to make you better and your company better, but you also have to make it better for the seller, especially if they're staying on and you're not just buying their assets. They're actually going to stay on and keep an office and run and be a part of your organization. It has to support both sides. If you're missing one of those, you're going to have some breakage there.

1:01:00Don't be afraid to call it the BS. Exactly. I like it. Amy, what's the craziest thing you've seen in M &A? Back to don't be afraid to call it the BS. The crazy thing I've personally seen as a sell-side advisor literally screamed at us because we were doing just that. Lost their cool, completely flipped out because we were not having it and we were not putting up with it because what they had given us, it was the financial stability, the health of the company. It was different once we started looking into it. And when you start to call that out and somebody doesn't like it, it'll be very interesting how they react.

1:01:35And that's how you will know you made the right choice and the right decision. So the banker freaked out. Completely freaked out whenever we just weren't having it. It's like you're lying. No, it was just we started asking the right questions. They would tell us things and we would start to dig and dig and explain to them why it didn't make sense. And that really shows the stability of the company wasn't there like they were trying to tell us. And so it was we just stayed calm and stood our ground and the conversation ended. Too much lipstick on the pig. And then it killed. End of deal. Yeah, and that's okay.

1:02:06It happens. This has been great. Yeah, it's been wonderful. Thanks for having me. Thanks so much for taking the time from doing deals to have this conversation and help me become a better M &A scientist. I've learned from you, so I hope you learned something from me. I have. This has been great, Amy. Those of you still with us, thank you for sticking through. And until next time, here's to the deal.

1:02:38Thank you for taking the time to explore the world of M &A with our podcast. We love hearing feedback. Tag us on a LinkedIn post, add a review on Apple Podcasts. We'd love to hear from you. If you need help standing up an M &A function or optimizing one that you already have, we're here to help. And if we can't help you, we probably know someone that can. You can reach out to me by email, Kisan, K-I-S-O-N, at mascience.com, or you can text me directly at 312-857-3711. If you just want to keep learning at your own pace, visit mascience.com for a lot more content and resources. That's where you can also subscribe to our newsletter.

1:03:22Again, that's mascience.com. Here's to the deal.

1:03:36Views and opinions expressed on M &A Science reflect only those individuals and do not reflect the views of any company or entity mentioned or affiliated with any individual. This podcast is purely educational.