The People-Centric Approach to M&A Success

If you've ever run M and A in a competitive bank process, you know the game is rigged, the deadlines aren't real, the information is filtered. By the time you get what you need, you're already behind. The process isn't built for you, it's built to drive the banker's agenda. That's why we built the Buyer Led M and A Masterclass to flip the script. This is the playbook corporate development teams use to take control, cut through the noise, and win in competitive deals. It's loaded with real world strategies, practical insights to ensure you don't just survive the process, you own it. Want to see how the best corporate acquirers stay ahead? Go to heelroom.net masterclass links also in the description and you know how we do it at M and A Science we give the best stuff away for free. Back to the episode. I'm Kisam Patel and you're listening to M and A Science where we talk with deal professionals and learn valuable lessons from their experience. This podcast focuses on stories, strategies and what actually happened during MA deals.

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Scientists welcome to the M and A Science Podcast where we learn from the best in M and A to uncover proven techniques for enterprise value creation. If you're interested in learning more about how to optimize your M and A practice or want to get involved with our community of forward thinking M and a practitioners, visit Masscience.com subscribe to our free weekly newsletter. If you want to keep up with us on the go, head over to LinkedIn and follow M and A Science. I'm your host Kisan Patel, Founder and CEO at Deal Room, a Chief Scientist at M and A Science. Joining me today is Michael Hoy, CEO of Great Day Improvements. Great Day Improvements is a vertically integrated direct to consumer provider of branded premium building products and one of the leading residential remodeling companies in the United states with about 4,500 employees. Today we're going to talk about the people centric approach to M and A success. Michael, how you doing today?

I am doing great.

Thanks for taking the time to have the conversation. Taking a break from running a very large company doing M and A deals.

This is my favorite part is doing this. It's a mental break but it's the stuff I love to talk about most.

We can look at this like a former therapy session.

This is the therapy session. So for me and everybody who's listening.

Then we kick off with a little bit of background.

Grew up in Baltimore, recently had a birthday, just turned 52 so I spent some Time down in Florida, near where you are. Grew up in the lumber business. At 14 I started in a lumber yard and have stayed in building materials for coming up on 38 years in January and really was in building materials dealing with home builders and contractors and eventually got in the direct consumer world with the window business. In the Baltimore, Washington area. One of Pella's largest distributors became kind of an obsession to try to understand how the consumer responded to marketing and the sales methodologies. And there's really nothing better than seeing a customer's face after you finish a project and they're super happy with what you've done. So there was a whole new level of fulfillment that came from that. To be honest, the margins are much better in remodeling than they are in new homes. That didn't hurt either and decided to put my effort there. And it brings me to great day today, some 10 years later after I joined the company.

And you do M and A deals there?

Yeah, we've done a few. I go back to my days at Carolina holdings and Stock Supply and they were in a mode of rolling up lumber yards and building materials manufacturers that were direct to the builder. I learned a ton of what to do and I think even more importantly a ton of what not to do. That's really what brought. As we came to great day and we started to determine that M and A was going to be really an opportunity for us. We went at it with the idea of don't break a business that you buy. Every business has some degree of unique culture, unique processes, some of which it's really easy to judge from the outside whether it's right or wrong based on perceptions or experience. And that was one of the things I learned not to do was really take a non judgmental, be really curious approach to M and A and really focus on what is it that the people are bringing to the table. These businesses are very people centric. They tend to have a lot of entrepreneurs in them, from the founders and leaders all the way down to the guy that's slinging a hammer. Tends to be somewhat of an entrepreneurial minded person and they all have a lot of opinions on how things should be done. And a lot of times their ways were better than ours. So I always felt like we needed to really be curious and not judgmental of the companies, which meant we needed to really get to know the people and build relationships and build trust really early on so that we could understand where the opportunity was for them and for us. We wanted everybody to win anytime we Did a deal. And that's the same process or mentality we take to every deal we do today.

Don't break a business. Instead, learn from it.

Pretty much when you go into M and A, there's an opportunity to bring multiple organizations together to create value of some kind. And when you're in the private equity world, we have outside investors that are really amazing. They bring a ton of skill to us, skills that we didn't have. But we like to say that we're not a portfolio company because we're primarily owned and operated majority by the entrepreneurs, the people that have been in these businesses. So when you're a private equity company, you don't know how to not call someone a portfolio company or a business. Not a portco, I think is what you mean. They don't know how to not be private equity and we don't know how to not be entrepreneurs. We find that balance. And when you're bringing business together, the value creation certainly is. There's an economies that go into this and the economical and the monetary opportunity that comes with value creation. But ultimately people make these things go. You got to really care about what you're doing. You really got to have a way to feel good about other folks. And again, don't be judgmental, be curious. Assume best in everyone. We find that one and one equals three. When you bring some really great organizations together with a bunch of people who care a ton and you treat them really well and you go into these with the idea of we don't go in saying we're going to get synergy because as soon as I say the word synergy, everybody assumes I'm going to cut costs and that means I'm going to cut heads. In our world, these are growth synergies. How do we come together in a way that everybody's going to rise? In our opinion, we need more people to do that, not less. So today we're around a billion and a half dollars in revenue. If we're going to be 5 billion in three years, more than 50% of the people that I'm going to need in five years don't even work for us. Yet cutting people doesn't seem to be the way to go. In my mind, it seems like we really should be building relationships and building trust and helping to develop them. So as they come into great day, we learn from them, they learn for us, and all boats rise.

You mentioned that the PE firms, minority and majority, is owned by the owners. Is there like a anticipated return event, like an IPO or Something we have.

This belief system that if we're doing all the right things, we're growing the business, our margins are growing faster, we're retaining employees. The EBITDA is where we need it to be so we can continue to invest in the marketing machine which really makes these things go, that we're going to have lots and lots of high quality choices across a period of time. So of course some of our partners have timelines in mind that they want to exit and we've brought in other partners to help supplement for when one wants to get out, another one's coming in. But we don't have some giant exit plan that says we're going to monetize this on X year. We're viewing it as opportunity seems to come our way because we love people, we are constantly in the marketplace building relationships with all of other investors or other strategic opportunities. And I see us doing more minority recapitalizations of the business. Over time there can be some sort of monetization. But for us to continue to run the business and own it as the entrepreneurs and be the majority, we think that's the right model today. And for us to continue to do that, there's not going to be some major recapitalization of the business. We're going to continue to invest in it. And everybody seems to be on board with that idea.

You could continue doing that, do another minority recap, then bring in some secondary to take out some folks that want to potentially have an exit.

So the last deal we did was with Leafguard and Engler and we did those same company. Engler's the manufacturing arm of Leafguard and they also do building material, distribution, sales to contractors and supply houses. We did a recapitalization and brought in some new investors that are minority to help us get that deal done. The strategic relationships that are being built again, because we've created a good reputation, we treat people well. You don't realize how important that is until an opportunity comes your way.

Yeah, it's a lot where you're finding the business, the opportunity, then you need to put the capital together. Are you developing these relationships? I mean, does this all fall back on you? Do you have a board you're leaning on? Because I feel like it's so much for one person to do.

I call myself first among peers. I don't call myself the CEO. I've always felt like we're all working together, we're all trying to accomplish the same thing. And in my 10 year period, I've never felt like I Ever had to make a decision on my own or in a bubble without getting really good alignment from the team and the business or any of our partners. So the folks at Littlejohn & Co. Who are one of our investors, they have tremendous relationships with institutional investors, family offices, sovereign wealth funds. My partner, Ed Weinfurter, who's our executive chairman, he and I are both relationship builders. We've reached out on LinkedIn to people we've never met before. And just to get a conversation started, and you'd be amazed where some of those relationships end up that you never would have thought could have happened. And then I've been really connected in our industry forever and ever and ever. I've been doing this my whole life. So those relationships that I've established over years, we try to leverage those. Not in a way that we're trying to get anything from anyone, but we want to leverage them so that if there's opportunity for them to grow with us or for us to grow with them, someone always knows somebody that needs something or wants an opportunity, whether it's new employees, whether it's an investment opportunity, whether it's M and A. I'm always amazed that the circle of people you put around you, how many opportunities they bring to you and you don't even have to ask for them if they like you and they trust you and it's a mutual relationship, everybody feels it's worth having opportunities come that you would have never thought could come.

You're a big strong point there. You have to build the reputation, but also the relationships through this broader ecosystem. You mentioned that investors help you find other investors. I love how you're not shy about reaching out to people cold and then through your industry contacts, which I think is going to come up more in this interview. We haven't even touched your outline yet, but we will talk more about the people side and when it comes to executing deals, one of the things you mentioned earlier was growth synergies. Can you talk to me about that in terms of how it relates to your strategy? It sounds like you're not just buying companies that look like good deals.

Yeah, we're not. So when our initial objective when we break day was first formed is we. We had two brands. We had the Patio Enclosures brand, which a lot of people knew of nationally, we have the Stanic Windows brand. The Patio Enclosures brand, Sunrooms is really arguably one of the hardest fulfillment type of projects you can do. There's a lot of permitting and electric and lots of subs. And we wanted to process that to a point where it could be replicated really easily. It could create a great experience for someone. And we figured if we could scale that business, what could you layer on top of it over time that were much easier type of installations and fulfillments such as windows or gutters or whatever it may be. So that was the original premise of building out the national platform on the patio enclosures name, if you will. There is not one home improvement company in America that we know of that has scale like we do, that does multiple products and specialties. If you're a homeowner and you replace your windows and you had to get it done, it's not necessarily something you want to do, but you have to do it and you do it and you have a really great experience, you're going to tell everybody about that experience. You probably are going to do other things to your home as well. You're eventually going to do your gutters or you're going to do your bath, or maybe you're going to do your roof. So our objective changed from just building this national platform to building a national platform that's the most referable. So not only refer outside of your network, but for you to be a repeat customer. And we could create a customer for life. So we've got nine big brands today around the country that people know. Some are more regional, some are national in scale. But why shouldn't a customer have a great experience with patio enclosures and then why shouldn't they be introduced to the other brands that are under the great Day family? Whether it be Leafguard or Champion or Universal or the Bath Authority. People want to deal with someone they can trust. And if we've done a great job for them, every one of these businesses should be able to grow organically because of the reputation of the other businesses. We keep calling that the holy grail. If we can create that which nobody else has created, it should give us a competitive advantage to continue to satisfy homeowners across the nation in a way that no one else has done.

That's interesting. The synergy betting on is a strong referral platform, not a complicated integration. It's not about bringing these things together in one roof or centralizing.

There is some centralization that goes on. We do want consistency in our financial reporting. So there is a certain degree of bringing that into a central system. Not necessarily taking all the people and picking them up and moving them to our corporate office, but doing it in a way where we get consistency in data and practice.

That's really important to Us, it, HR finance. That's like every private equity firm preaches.

We are bringing more and more of that into the back office, into a shared services environment. Since day one, we do that. However, we don't want to lose that entrepreneurial spirit. And all these businesses come with different systems, different philosophies, different processes. So we have realized some opportunity in saying, look, we've got some businesses are really alike. They should probably be on one platform in terms of their CRM. And we've got everybody aligned with that. And we're in process of doing that in five of our brands right now. We all agree that having eight call center systems makes no sense at all. So how do you bring your call center, your communication technologies and your tech stack together there? Benefit everybody internally, but also that your customer benefits from it so they can have a great experience with everyone in the same manner. Think about this. Anytime you've done a home improvement project, no matter who you decided to purchase from, your expectation was a great experience every time, right? So we want to try to create that across all the brands. There is consistency in communication. There is a Great Day way of handling a customer regardless of what brand was facing you at the table.

Does that experience come to the customer at all where they associate with Great Day and then that becomes part of the trust.

That has not been the way we've been set up, but that's where we're headed. So there is a lot of work going on behind the scenes today to really help us understand how does the customer see each one of our brands? Each one has a little different value proposition. At least that's what we believe. Does the consumer see it that way? And if they do, how do we make sure we maximize that? But then how does Great Day span over all of these different brands as really that leader of home improvement and the provider of all of these services? So we're doing work now with a lot of customer focus groups. We've brought in some outside help to really help us figure out how do we leverage the Great Day name so that we bring everything together for the homeowner under one package.

Build a stronger brand. This is what gets your investors and owners of businesses you acquire excited is that there's a story about building revenue synergy. We're not just doing the typical consolidate cost synergies, but hey, we're actually building a way to grow revenue and it's.

Actually worked for you and it continues to work. Right now we've brought a group of 25 high potential employees, leaders from around the company for a new leadership course that we're going to kick off in January. It's led by myself. That's called the Great Day Way. And we've taken all of our core strategies, all of our core competencies that we believe it takes to be a really great leader at Great Day. And we're going to teach on those specific things. And these are folks that span all 12 of the brands. So 12 brands working together. Some are competing with each other from time to time, but they all understand we're on the same team and we all have a benefit. Imagine a scenario where you have one company, you got all these opportunities, you want to test stuff, so you're piloting things all the time. We're literally a petri dish of ideas. So I can test at your home improvement company a system and test their competing system over at patio enclosures and go, which one really works? Without any bias or opinion, the data will win. And now we have all these places where we can create petri dishes of new ways of trying things. That's pretty exciting for people to get involved with that.

Yeah, that's like the fun part you want to experiment on is the real growth drivers of the business versus some of the other.

We call them the growth levers. Which one are we pulling right now and what can we pull and how fast can we pull it? We're doing that all the time.

Let's talk about execution now. I'm going to actually look at my notes here. So yeah, let's talk about how do you actually make this work?

Oh, certainly the philosophy matters, but the execution of it is where the magic happens. So the strategy is pretty simple. We're trying to create the first nationally scaled home improvement business that has multiple products that can be the most referable and create the best customer experience. That is our mission. That's what we're trying to do. A lot of pieces and parts that make that happen. So when we're looking to bring in a new business, the very first thing we do, especially through diligence, is really that management meeting and getting to understand how they think about their business, why they think about it the way they think about it, what have the results been? Which is always important. And we are looking for certain results. But we want to understand how the leadership team drives the agenda. What do they execute? How do they execute it? What are the big barriers? And there's one question I ask a lot or it's really two. The second is the follow up is what is one thing that we would be Crazy about to change if we walked in the door. And they always have a very consistent answer. And then we'll ask the next question is, what would be the one thing that we would be crazy not to change the day we walk in the door? And it's funny. Everybody wants change, but they don't want it to them. They want it for everybody else. So we really come in early on with the idea. In the first hundred days, we're going to do nothing but seek to understand we're not going to change a thing unless something's broken and it's a crisis or something's been identified as it really needs to be addressed early on. Our objective is to do nothing the first hundred days and really get to learn the people, the business, the process, the practice.

Post acquisition. You don't do anything for 100 days.

There are some things that we will start to do the very first day. And even prior to close, we will start working on harmonizing the data. So we have a dashboard of all the metrics of our business. We think that's what winning looks like. That's what high performance looks like. We will go into their metrics with them and say, okay, explain to us what a lead is. We're all trying to get leads. Define what you count as a lead. Every business we've ever acquired has a different definition. Although subtle and sometimes nuanced, the way they count things, the way they measure things, what close rate looks like differs by company. So we want to make sure that when we're talking to a new partner that we're bringing into our world, that we're all looking at the same scorecard and we all know that it means the exact same thing. Everybody's going to know what winning looks like really early on. So if you don't harmonize terminology and harmonize the data, it's almost like we're speaking Spanish and they're speaking Chinese. We have to get early on really good communication on the same metric. We do start to. Again, part of harmonizing data is the financial. So what's their financial structure look like? All the GL accounts, we don't change it right away, but we do start to map it in a way that we can understand their financials in the way that we would typically view them. But business process changes, practices change in strategy, marketing tactics. All we want to do is learn why it is they do what they do. We're buying them for a reason. Because they've been successful, we see there's opportunity to help them improve and they May be help improve us in areas where we're weak based on what their criteria is and what their strengths were. But I don't want to break them. There's a culture, there's a spirit there.

Michael, what stage are we talking about? Are we like pre loi? Are we signed loi?

When we we're signed, we're signed.

So we're signed loi. And what we're really trying to do initially is just keep clicking in the business. You got enough interest to sign with them and then you really want to dig deeper and seek to understand, figure out the how, the why, understand what the historical results were from what they've done and then how they execute things, the what and how behind that. And then I love the two questions. It would be the one thing that would be crazy to change would be the one thing that's crazy not to change. I find that really helpful. We just get people thinking about one thing instead of trying to make a laundry list. But you tend to get the answer versus getting a long list and then trying to have to figure out what the one thing was. Yep, that makes a lot of sense. It sounds like that's sort of a great start for just understanding the people and culture components. How do you start thinking in terms of what it's going to. Other components I guess drive success?

Well, for us, it's all growth synergy. So we typically start where the business starts, which is with the marketing. So we want to understand what the marketing tactics are, why they've been chosen, what's been the strategy. Is it data based or is it more in somebody's mind? That's just how we've always done it. What metrics are available to help us prove out if the strategy is right or not. Do you have data to help with that? And if your reporting isn't great, that's an area we're going to write down as we could bring a lot of opportunity and help to fix that or make it better than it is today. And we're going to spend a lot of time on marketing in the beginning. So we tend to be more aggressive and assertive with our marketing approach in terms of the amount we're willing to spend and invest than most of the companies that we acquire. That's a new concept for them. So when we tell them, look, we want you to double your spend in this area, they look at us like we got 10 heads. They need to understand what they're doing, what we're doing and why we're doing it, and what the results are so we can prove that the methodology makes sense. Another question we asked very early on, and this is more in diligence, is how many locations or what was their growth plan that they had planned for the coming year or the next three to five years. And usually there's some sort of organic plan to open new locations, add a new product. And we'll ask the question, if you're going to open up two new locations next year, what would you need to open up 10? It immediately changes their mind from we're going to open two to oh my God, they're going to ask us to open up 10 new businesses next year. Oh my God, we can't do that. And we do that deliberately. So they get used to the mindset of we want to grow, we want to be aggressive, we want to be on the leading edge. So instead of thinking about limiting your method or limiting your head to, we can only do this. What if you had unlimited resources? What could you do if you were given those resources? And it gets people out of, well, I just want to grow 10% or I just want to grow 20%. When we go into our planning for ourselves or any business, we don't say, what's your goal for next year? And they go, we're going to grow 20%. So they take their year end number times 1.2 and that's what they're going to do. We say, what's possible if the investments were made, the resources were provided, what could you do? Sometimes they'll come back with a plan that doubles the business and we'll go, okay, timeout, That's a little too aggressive. But you could grow 50%. They're like, oh, yeah, obviously. So we don't put plans together that limit us. We like to put plans together that are really aggressive. And then we say, what would the execution barriers be to us doing that? And then we build those into the plan. So we are always going to grow more than we thought was possible. We're at least going to put plans out there to go get it. So we have a saying in the business. If you don't plan for it, you won't get it.

When you buy the business, you're first really trying to unify the financials and understand that you can measure in the same metrics and get on the same language. There's. And then it seems the focus is between this referral network and the marketing playbook, which is very growth revenue synergy oriented.

Yeah.

And then it sounds like part of the alignment is with the leadership culture kind of getting them thinking bigger. So with that, can you walk me through an example? What's been a big win where you've taken this approach?

There's been a lot of examples. I'm going to use Champion Window and Door. So we acquired them at the end of 2021. They're a national company. They've been around for 70 years. A lot of people know them. They have a manufacturing plant in Cincinnati, Ohio. So a lot of our brands make their own product, but we had some that did not. And we went to them and said, what if you could make all the products in your factory for all the brands? They were like, God would take three or four years and this would be the capital expenditure and this would be. We said, what if you could do it in 12 months? And they came back with a plan to do it in 12 to 18 months and we funded it and they did it.

I'm going to read on your leadership style here.

But it was, why 18 months? Or like, look, if the resources were there and they were well identified and we knew what we needed, Capital is not the issue. It's typically people and process and systems. So what people would we need to invest in to make this go? What systems are not in place today or need to be expanded upon to help support the growth initiative? And then what process would need to be considered changed, adapted, applied? That's never been applied for us to make this go. And from that comes a plan and usually it's got dollars applied to it. And then we look at what the return would be on that and go yay or nay. We try to keep it as simple as possible. Look, nobody wants a CEO or a leadership team coming in and talking in really big terms that nobody understands that only the bankers and PE guys understand. We want to show that one, we're genuine and we care, but two, that we're really willing to invest. And then once that's been put in place, everybody has a comp plan based on growth and success. So all of our comp plans have a degree of growth and a degree of ebitda and it's weighted based on where you have the most influence. So if you want to win here and comp's part of your win, we're going to show you how to make more money.

I wrote in my notes here, think bigger, think faster. Summarizing your leadership approach as you influence that. It reminds me of we talked about the being curious versus not judgmental. I feel like that's lending to it. Where you're curious of, hey, can you do this faster? Can you do this bigger? We talk about that. Cause I feel like that's such a big, important part is just the mindset of how you approach this deal that I feel like just lends into so much of the leadership.

Everything's about the mindset. So the leadership style that we're gonna. That we're training on right now is our culture is based on these things we call our team commandments. I'm happy to send this to you if you'd like to share it. But number one is help each other be right, not wrong. That can be really hard to do when you're talking about change and aggressive growth and everybody's got an opinion and, oh, we can't do that, or we've never been able to do that, or getting your mind out of, what do you mean we can't. What if we could? What if everything we ever knew, we just said, we're never going to do that again. We're going to start over and recreate it from nothing. Number two on that list is look for ways for new ideas to work, not reasons they won't. That one's another hard one. Help each other win and take pride in each other's victories. So our entire culture and mindset is built around these 10 team commandments. And we teach to them, we coach to them, and everything we do when we're talking about an initiative, we go, God, can everybody act with initiative and courage as if everything depends on them when we're trying to do this? Because that's what we're asking them to do. Can everybody speak positively about each other through this? Because this is going to be a lot of change, and it's really going to be squirmy for everybody. It's going to make people uncomfortable. Can we have fun while we're doing this? That's one of our team commandments. You got to have fun. So you start humanizing the business. People will rally around that because it's just not about the dollars and cents. It's about how are we going to win together. What does winning look like? I don't know anybody that doesn't like to win.

Your team does that because they heard it from you a hundred times. But what about this newly acquired team?

It takes time. Early in the diligence part, we signed the letter of intent. We're not closed even before the letter of intent. We are preaching these fundamentals all throughout diligence, all throughout, even the courting period, so that they hear A consistent message. So they're hearing it from me and my team. And then when they go to the next group of people, finance and accounting and hr, they're spitting out the same things I'm spitting out and that my team has spit out. One of the compliments we get from investment bankers, some of the investment firms and the businesses that we've acquired is they're always amazed how aligned we all are in terms of what we're talking about. We're all saying the same words, we're all saying them the same way. We're just really aligned with how we're going to go about integrating a business. And that brings a lot of trust and credibility to someone who's really nervous about what happens the day after close. Is this really who they say they are? Is this really how they're going to operate? There's always that nervousness. So I always feel like we have to prove ourselves. I'm asking everybody to trust me day one, yet I have to trust everybody else. That's hard to do, but that's how we go about it.

From the early stages, you're making clear transparency on the culture mindset and continue that. One of the things I talk a lot about is like Violet M and A. And I just feel like it's just how the evolution happens. First deal, pretty seller driven. You do more deals and just naturally becomes more buyer led. It's one of the things I've been actively doing is trying to build a framework around it.

Yeah.

Identifier. There's like the key elements that sort of lends to you to really do that. Because I feel like this kind of influencing the culture from the early stages is very buyer led. You're like, clearly this is how it's going to be. This is what it's going to be like working together. And the reason I want to get into that because I feel like it lends right into the element of being buyer led, into the decision making, which decision making ultimately drives the success when you're on the same page with it. Because if you can't make a good decision, you're slowed down. It's difficult.

It's all hands in. The other thing that I do a lot of, and this is more post close and it's for the whole company. But early on we get them really involved. So I do a month webinar called Hanging with Hoy and all employees are invited, all 4,500 of them. Last month we had 800 get on. So pretty good size. And I give an update on the business for about five minutes and then I always have a special guest which is usually one of the brands. So when we first acquire you, I literally bring you on the first hanging with hoy and I give you the spotlight for everybody else in the company to hear your story and why you're different, why you're better and how proud you are to be with Great day and everybody's high five and virtually. And then we spend on every hang with Hoy 30 minutes of open question. I do get some pre submitted questions, but it's unscripted, man. I get stuff from out of left field. So this idea of showing people one, everybody wants to know what's on my mind or what's on the company's mind. So I just tell them very frankly what's working, what's not, what we're proud of, what we're working on. We get 800 people asking questions and shortly after that there's a link at the bottom of my email that says book time with me. I'll get 20 employees go out and book time with me over a couple of week period for 30 minutes each to talk about whatever it is they want to talk about. So there is no way any employee new coming in as M and A just hired. If they want to know what's going on with the company or they have a concern, the best person to ask is me. You can't go any higher.

How do you do that with 4,500 people?

I block a certain amount of time on my calendar specifically for building culture. That's what this is about. It's about building culture and building teams. That's likely the most important job I have because if I get that the people make our customers really happy and if we have really happy customers, everything else seems to work itself out.

I like this. You do this monthly?

I do hanging with Hoy monthly and usually every day I have some sort of employee who scheduled time with me for 30 minutes every day.

So monthly 5 minutes update on the business, introduce maybe even one of the new businesses that's part of the new parent company and then Q and A, have some can questions but like keep it open for for folks to ask questions and then afterwards, which is really true, there's some folks that don't want to speak an open forum. They're more comfortable in one on one. You give them an opportunity to book time one on one.

Yep. Do it every month. It's the third Wednesday of every month at 11am and then all these like.

Newly acquired employees are Right into this. All of a sudden it's like, absolutely.

Everybody'S in it right Day one.

It kind of helps keep this sort of synchronization as you bring companies in and they got to get that 100 reps of you talking about the culture and values.

What happens, whether it's M and A or you're growing, you hire somebody, you tell them about a new initiative or something we're doing. Everybody wants to know, what does this actually mean for me? How does this affect me? Is this good for me? Is it bad for me? Is what are they telling me the truth? So what better way to ensure that they know we're truthful, we're genuine, and we can be trusted than to talk to them all the time about anything and everything they want to talk about?

That's an important thing, too. I guess we need to specifically talk about building trust, the element of trust. But then I guess I was curious if you had other approaches in terms of just understanding the company's culture you're bringing in or things you do to just bring that.

There is a Typically an executive leadership team at the business that we're bringing in. We tend to connect them very early on to their peers throughout the other brands. So there's usually a unit president, division president, or a leader in marketing. We bring those people into, get them introduced to a new team of peers that they've never had before and start building trust with folks that. It's the idea that I can pick up the phone and call a founder of another business with a problem that I'm having that they've solved. I've never had that opportunity until now. I've joined Great Day, and I have that. So we want to do that at all levels of the organization. That also spreads the Great Day way, and people get to see it at a different level through other folks outside of just myself or the executive team. And it builds relationships. Those relationships get built, that trust gets built, and all of a sudden, best practices start flowing through osmosis, and people are begging for information, and they just want to be part of something bigger. You keep hearing me use the word trust. When people trust each other, they will do things you could have never imagined they would do. They will become vulnerable, they will be more genuine, they will be more honest because they don't feel like they're being judged. We're just being curious. We want to know how we all win together.

We'll do things 10 times bigger than half the time.

That's usually what happens.

You build a leadership Ecosystem. What does that consist of in terms of connecting the leaders together?

All of the business unit leaders, so the shared services leader, marketing, it, finance, accounting, all of them. And then the operating units. We take the executive team from the newly acquired business and we start to introduce them into all of these places around the organization. And all the division presidents have a monthly meeting of their own without us. And the marketing leaders are constantly having meetings together without us, sharing what's working, what's not. They're calling each other all day long. It sounds simple, but it takes a lot of work to connect people. So anytime I have an opportunity, if someone brings up a problem or an opportunity, I will sometimes on a meeting go, hey, so and so at this brand, I heard them talk about this problem one time or this opportunity, can I introduce you? And they'll go, oh my God, I didn't even know that person existed. So those little subtle things create a relationship and that relationship then ripples throughout their organizations and it just multiplies and multiplies.

Be really proactive to keep people connected, especially the leadership.

It's all about the people and the culture. At least that's my belief. And that's what's worked for. Great day. And that's what we plan to continue to do. And don't get me wrong, we have very high expectations. We have very big growth initiatives coming into 2025, both organically and M and A. We want to do more cross selling across our brands. There's a lot of execution that goes into this and these businesses are a day to day grind. It's hard. So if you don't have happy people that are working their ass off and don't feel like it's worth it, why would you come to work every day?

How about some of the more like tactical elements of executing M and A? Before we talked about M and a checklist and a rating system.

We have a rating system that our executive team uses. Once we've had an opportunity to meet a business and take a look under the hood, if we're going to move forward, we each take the rating system and rank it on our own, aside from each other. And then we put it all back together with everybody's names and go, all right, why did you rank that one a five? I only ranked that a three. Or I ranked growth opportunities a two and you ranked them a four. Why did you think they had better growth opportunities than I did? So we try to vet, did we all see the same thing? Are we all aligned with what the opportunity would be Both for the business we're acquiring and for us. And then there is a massive checklist for diligence. We actually have a Chief Strategic Integration Officer who leads that to ensure that we get it right. Her name's Carolyn Resart and she's culture Builder too. So she's the master keeper of that list. But she's also the giant cheerleader for the company.

I thought you didn't do so much in the first a hundred days. You kind of wait to sort of learn the business.

We do. But keep in mind there's still a lot of things that have to be learned in that a hundred days. And on that checklist is all the things that we need to be really curious about.

Interesting. So it's like you're continuing to do diligence after close.

Yes. There's no way we're going to learn everything we need to learn about that company during diligence. It's never happened.

That's true.

But if we built enough trust during diligence, they'll actually tell us the truth once we're in the building.

That's a really good point.

They won't hide it.

Any other good tips or lessons on execution and making these deals successful?

As much about the deals you don't do as it is about the deals that you do?

I'm learning that the hard way definitely look at deals I'm not doing. And it's expendable to walk away from the deal. Because you don't see a fit with the leadership team.

Correct. We've had that. We've walked away from deals that we did not think it was going to be a good fit for them or for us.

How does that conversation pan out? No hard feelings?

Yeah, we just all of these otherwise are non binding. We typically tell people upfront the purpose of the lois that we're going to get to close. That's our intent. But things can happen either on your side or our side. If it's not a good fit for us, we'll be really honest as to why and hopefully you'll be able to help us overcome that or help us see something we didn't see. But if it's not a good fit, it's not a good fit. Do you want to join a company where it's not a good fit? Probably not.

Good point. Your company's grown a lot through acquisitions. How is your leadership style grown with the company? Because it sounds like you do a lot to really keep people connected. I'm just curious how that's evolved.

There's more and more of that that I do now than I ever expected I would do and more. I've been working with my leadership team, who may have not been as experienced with M and A in the past, to make sure they stay really connected to the new teams that are coming into the business. When you work in a corporate office, it's really easy to throw lightning bolts from Mount Olympus and say, here's a process or practice and this is what corporate thinks we should do. We don't throw lightning bolts from corporate office. We communicate actively, openly. We ask people's opinions, we talk about things we want to do. If we have someone that's not used to communicating in those methods or doesn't have that same philosophy, I'll spend a lot of time with them getting their head wrapped around how we're going to talk to people, how we're going to communicate, how we're going to bring people into the family. I'd say 50% of my time is spent on culture, either directly and deliberately or secondarily through me. Coaching people, talking with people, promoting the business, working on a big project, helping the marketing team. I'm constantly driving culture through that, and that's my main job.

How do you get time to do deals?

It's all just part of the normal cadence.

Yeah, that's so true. Because you got to take care of all the new people coming into the business as well.

If you just do that, everything else does. Okay. Because if I'm talking about how we're going to operate and how we're going to work together, I'm going to somehow tie that into. Let's talk about how we view the metrics and the why behind how we view the metrics. Now they're getting an example of how I view it, why I see it that way. If they have a different opinion, I want to know it. But they're getting an expectation all of a sudden of how we're going to do business together. That's culture building.

You're right. Very important. Click into that more in the next interview. Yes, Michael, this is a great conversation. I appreciate taking the time. I learned so much. You've helped me become a better M and a scientist.

This is awesome. I love talking about the Great Day story. We know we're doing something that nobody's ever done, and we recognize that we. We're just getting started. So we got a lot of opportunity to continue to get better and grow. And the fact that we get asked to do these things is humbling. So I. I love talking about it and appreciate you having me.

My pleasure. Fellow M and A scientist. You made it this far in the podcast. I'm just a big of a fan of you, so connect with me. Reach out to me on LinkedIn. I love when I get those messages and feedback. Whether it's topic, ideas or suggestions, criticism, I welcome it. I want to get better at this so it helps everybody. Till next time. Here's to the deal. Thank you for taking the time to explore the world of M and 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 and 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@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. Again, that's Masscience.com here's to the deal.

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