93. Business Vulnerability Part 1 - Overall Exposure

Foreign. Hey, my friend Kenny Chapman here, your host of leadership in a nutshell. We're cracking the code of the driven mind and we're focused on home service contractors, the blue collar world where you and I live, breathe, and get to have our life experience. So welcome to episode 93. I'm gonna do a three part series for you in 93, 4 and 5. I'm gonna do three parts on business vulnerability. So this is Business Vulnerability, part one, overall exposure. Okay, so business Vulnerability, part one, overall exposure. Now this is where I want you to just kind of think about, okay, I'm in business, therefore I have vulnerability. And I want you to insert your own role into what we're talking about here today. Regardless of whether you're a service manager, a sales manager, the general manager, president, CEO, whatever your title is, doesn't matter to me. Your, your perspective matters to me. And I want you to think about your overall exposure in your role and in your business and in your life situation. And I'm recording this episode based on a client interaction that I had recently. If you haven't had your head under a rock for the last 24 months or so, in our space, obviously there's massive movement going on, private equity money like we've never experienced. And a lot of people either taking money, selling businesses, selling parts of businesses, whatever that is. And we're very blessed at blue collar to help people navigate deals, getting deals done, as well as experiencing, if the time is right to sell, helping people get ready to sell, whatever the needs are of the client, because it's a very individual thing. And one of the things that we see that come into the play of acquisition and whether you're the buyer or the seller when it comes to acquisition, is there's a vulnerability component. And as I said, I'm going to do three parts where today I'm talking about overall exposure. Because I recently was working with a client that's considering taking a partnership. And as we're doing some digging and really kind of exploration as to what the goal is and what the feeling is, the word vulnerability just kept on coming back and creeping in. And like, you know, I just, I'm vulnerable. He's got a little bit of a smaller business, say, you know, in the 3 million ish range and as in nothing wrong with that type of a business. I ran a very successful $3 to $4 million company for many, many years that was self managing, created an incredible lifestyle for the lovely Christy. And I didn't have to work in the business. I didn't have an office in the, in the business. So, you know, don't get sucked into. The size of the business is the only thing that matters. I talk to $100 million operators that are stressed out, and I can talk to $1 million operators that are stressed out. So the size of the business doesn't matter. There are certain things that happen as the business gains in size. But don't kid yourself into thinking the size is going to solve everything for you. So in this case, around a $3 million company, which means that he felt some or feels some vulnerability around his top leadership. So, well, if this one particular manager was to leave, then I have massive exposure. And today as we talk about overall exposure, I just want you to think about some of this. Where do you feel exposure? And I said, okay, cool, so you feel some exposure. If this individual left the business, then you'd have to jump back in at another level and take on some day to day responsibilities that you're not currently executing. Okay, cool. So if you sell and he's looking at selling 50 to 70% of his business and taking on a partner and with a, you know, a company that's a little bit bigger than his in some different markets. And so go. Okay, so now if you go ahead and sell, then do you remove all your vulnerability? Well, no, but I'm not the one on the hook for, you know, necessarily for this manager role and this and that. And this is why I wanted to record this episode for you. I want you to just think about where in your life you don't have vulnerability. And you go, well, Kenny, I'm a millionaire and I have cash. Okay, cool. What if the dollar just becomes worth nothing and all there is is bitcoin and you can't buy anymore. Whatever, right? I know I'll talk some crazy stuff for you today because we live in a crazy world where we tell ourselves all these stories and I'm not trying to cast a. Oh crap, there's no security in the world. Where I want you to realize is that vulnerability is tied to self image. And so if I feel incredibly vulnerable, a lot of the times it's tied because I don't have a super elevated self image. And therefore I'm thinking that the less vulnerable I structure my life, then I'm going to feel more security. And ultimately what I'm unconsciously thinking is that I'm going to feel better about myself and I'm going to have a higher view of myself and I'm going to have more security. I'm going feel Better long term. What we know, and I'm very blessed. I've owned nine businesses in five different industries over the course of my life. And I'm very fortunate that I've had the ability to see different things. And the common goal that there are, the common denominator, I'll say that we always kind of hear and think through and are exposed to, is that no matter where you go, there you are type of thing, right? And that's true. Every business that I've had, I bring Kenny Chapman along with that. Every interaction, every partnership, every leadership team that I've built. Kenny Chapman has been the only common denominator. I've had different team, I've had different people, I've had different partnerships. I've had all these different things. And yet, at the end of the day, Kenny Chapman is the common denominator. Everybody else brings themselves. But I want you to think about this when you look at overall exposure, because I'm watching businesses and leaders. I'll say within. Businesses make certain decisions out of fear, out of feeling exposed. And yet they're moving into a different level of exposure. So I'm not here to tell you whether you should sell or keep your business. I'm here to talk about vulnerability. And in this particular case that I'm talking about with this case study with a client is there was an unconscious perception that if I sell my business, I remove my vulnerability. Well, do you remove it or do you remove that category of vulnerability? Why? Because now I've shifted my vulnerability, shifted my exposure to now I no longer own 100% of the stock. Now I own a small percentage of stock. I'm no longer in charge of the day to day operation, which in the exposure part means I'm not responsible for replacing the manager, but now I'm responsible for other things which mean I have different levels of vulnerability. Are you with me here? Give me a little head shake. I'm not trying to overuse this word. And I'm doing this in three parts because next week I'll talk about external vulnerability. The week after that I'm gonna talk about internal vulnerability. Because right now I'm just talking about overall exposure. And I want you to just answer this question for you in your own situation, in your own life experience, in your own business experience. What if. Fill in the blank, because that's what I hear. Well, what if the old cliche of I train them and they leave? Well, what if I don't train them and they stay? What if I put my time, effort and energy into this general manager and they end up not staying. What if I create the compensation plan that I need to develop my leadership team and then the business can't afford it? What if. And you can just fill in the blank for you. Whatever size business you're in, whatever structure business that you have, you have a level of vulnerability. Why? It's called life, my friend. Vulnerability. When I say, well, what if, you know, and I've shared this with some of you as listeners perhaps, but I don't think I've talked about it on this podcast. But one of the fascinating things is the lovely Christy and I went through another motorhome phase and in 2021, where we bought a little, just badass little coach, a little Airstream, but it had all kinds of challenges and whatever. So we went back into the quote, you know, let's call it the hashtag van life story, right? And we had only had big. The smallest motorhome I'd ever owned was 40 foot. We had a 40 foot double slide and then we had a 42 foot quad slide tag axle back in the day. You know, we did a six month motorhome trip in 2007. Like, yeah, let's buy this little 25 footer that's just a little sprinter chassis and has one slide and just an awesome little, little coach. But the cool thing is that I got to be reminded again. When I was down in Costa Rica in 2021 and in January 21, we were walking on the beach and there's the, you know, the hashtag vanlifemovement and all this. And you have these young hippies that go down to Costa Rica and they live in their van and, and this one day we were walking by and this guy had the wheel off of this VW van and he was like packing wheel bearings and working. And I pointed out to Christy, I'm like, check that out. You know, they don't show that on the, on the YouTube videos and all the hashtag van life Instagram stories and all the different things like, oh man, it's so amazing out here. Oh yeah, until bearings go out and you got grease up to your arms and you're in the sand in the beach and all this different type of stuff. And, and it just reminds me of vulnerability because we go to, oh, I'm going to go live in a van down by the river, right? I'm going to, I'm going to go live in a van because I want to remove my vulnerability of having a home and having all the responsibility and Maybe I've got a house payment and maybe I've got utilities and everything keeps going. I'm going to remove my friend. Check it out and write this down. If you're taking any notes or if you're with me, burn this into your mind while you are alive. You will have vulnerability. It's one of the gifts of the life experience. We are vulnerable to things changing. That's one of the gifts is when things change. When I get to reconcile within myself around my own vulnerability. And I titled today around overall exposure in part one of business vulnerability. Because where's my exposure? Guess what? You woke up this morning, that means you've got some overall exposure. Now it doesn't mean that we don't stack odds in our favor. I'm not saying don't hoard some cash. I'm not saying don't protect yourself. I'm not saying don't build in stop losses if management leaves. If you, you know, are, are exposed in different ways. I'm saying don't live in fear and don't make decisions thinking that you're going to get yourself out of any level of being exposed in any vulnerability. As long as you live life, you are going to have a certain level of exposure. So the question becomes what is the exposure that you want to have? What is the exposure you're willing to accept for the business that you desire? Yeah, I have vulnerability in my life in the businesses that I run. I'm very blessed by a very powerful leadership team at blue collar. And guess what? I can't log into our CRM. I'm not a Service Titan user. I've never used Service Titan. If you held a gun to my head and said log into Service Titan and pull XYZ report, it would be my last day on the planet. That's not where I coach. I spend my time coaching behavior change and removing limiting beliefs and blockers from getting people to do the necessary thing. My team of coaches works with Service Titan and different industry softwares and the day to day operations of the businesses. That's. That's not where I spend my time and my energy. So I could say, well I need to know everything about those things, otherwise I have exposure, sure. But I choose to live my life where I'll figure it out. If I need to figure it out, I'll figure it out. And because of that I can lean into my leaders even more. It goes back to that cliche about build, you know, well, build a business to where you can operate just fine if you lose anybody I believe in building businesses that will suck if you lose anybody. Because if you have people that you can just absolutely keep on rocking without, then you don't have some of the right people. Now, I'm not saying that you don't. You know, obviously, that it wouldn't leave a mark if some people leave, but that's an old cliche. That's a fallacy. Like, we're so afraid that we're making decisions based out of fear instead of leaning into people's greatness and tapping to the very best that they have. That's what I encourage you to do. Do you have exposure? Yes. Are you alive? Yes. The. Those two go hand in hand. If you're in business, you're going to have some exposure. Let's stack the odds against it. Let's do the very best we can. But let's not make decisions out of fear. Business vulnerability part one overall exposure. This has been episode 93. I'm Kenny Chapman, your host. So very grateful to spend this time with you. Do me a favor. Kick this episode over to somebody that could get value from it and keep growing our community here together until we talk. Make it a better than fantastic day. I'll see you real soon.