#169 - How Entrepreneurs Should Actually Think About Money | Patrick Rogers (Elkridge Advisors)

0:00 Wealth is not something to be ashamed of. Creating true wealth is something to be very proud of because what does wealth give you? Wealth gives you the ability, resources to do amazing things in the world. All right, y'all. Hey, welcome back for another episode of the necessary entrepreneur. And as we start to dive deeper into this brand and expose you and myself to people of, either greater capability and expanding it beyond traditional entrepreneurship, um we have a lot to learn.

0:42 And today's going to be another one of those. So today is a Patrick Rogers. You know, a lot of times people with these basic names of Patrick and a Rogers, it's like, man, is it going to be depth to it today? There's going to be. um So Patrick, he's the owner of Elkridge advisors of course, another name that seems Elkridge Advisors. I promise you all, he is not this simple, but he works closely with entrepreneurs and business owners to bring clarity to financial decision-making, helping them think more strategically about growth, risk, and long-term outcomes. His work sits at an intersection of money and mindset, especially for founders navigating scale, uncertainty, and big decisions.

1:23 I'm personally looking forward to a practical ground and conversation. about how entrepreneurs can build financial strength without losing momentum. Welcome Patrick Rogers. Man, m how was that intro for who you are and representing what you're doing, what you're building? Man, that was fantastic. I barely recognized myself. ah Why did so many people are like, man, what's your history? Where'd you come from and all that stuff? But why did go back to 2017, 2018, when you really dipped your toes in this world of entrepreneurship, as we talk about your business and how you're helping entrepreneurs. ah Why did you do that? Cause I think we dig too much into who we are and where we came from, but it's like, why'd you do it?

2:06 What caused you? Cause then we're going to talk about how hard it is, what the steps it took, what all the failure looks like. and then how you can, what you've learned, how your business can then help other entrepreneurs. Why'd you do this? Because we're gonna talk about today about these things, but you have to be resilient and you have to have stick to it and this, have to do all these things and you probably have to learn new skills and develop self help. You have to have a different mental mindset from being an employee. Why did you do this? And then A, did you know what it was gonna be? Yeah, man. Great. question. Um, why did I do what I'm doing now? Why did I make the leap into entrepreneurship? Um, for me, it was, is all about freedom, Mark.

2:46 was, was, I knew from very early age, I knew that I was not put on this earth to work for another man and that, that we, as people were, were not meant to do that. And so, you know, when you think about people's lives and this hit me hard with my dad, my dad would go, he'd wake up every morning at five o'clock. hop on a train in Philly, leave at six o'clock in the morning, get into Philly at seven, work till six o'clock at night, be home at seven, whatever, eat dinner and go to bed. Like that is not the way I live to live a life, right? And he did what he had to do. He provided, right? Was able to get me off to where I needed to be. But like, when we look at life, it's all about freedom. It's all about, was not meant to work for another person for the rest of my life.

3:30 And we have bigger things to. to do in life. have a purpose over and above just existing and breeding children, right? So uh what kind of led me down this path is Navy over to, uh so I started like trying to, I think I started probably 20 businesses before I actually found the one that allowed me to make the leap. And it wasn't even mergers and acquisitions in 2017 at that time. It was finally doing business coaching to the point where it replaced my full-time income. that I was working for the man and I went into business coaching and consulting. And it's interesting story kind of just, keep going with it.

4:11 That's okay. Is what led me into mergers and acquisitions was. And actually one of my clients in 2017 business coaching clients. up to that point for the, so, so while I owned a property management company, I kind of got steered into just naturally got steered into doing business coaching for, a whole nother reason, but. I've loved helping people be successful. love changing their lives. And so I was helping CEOs up to that point grow organically. Right. So I work with the CEO once a week. We're talking about their team. We're talking about marketing, sales, whatever, but it's all internal stuff. It's not, I mean, it's external from sales and marketing and clients and all of that, but not inorganic growth.

4:54 So we're not doing business acquisitions. So in 2017, one of my clients came to me and said, Hey, I want to buy Uh, there's a company, he was doing 4 million annual revenue at the time. And one of his buddies owned a business. was doing 6 million. And he said, Hey, I want to buy this company. My buddy wants to sell it to me. Can you help me do it? was like, well, I've done acquisitions, but very small compared to this. So we pulled in an M and a expert. And this is what put to put me down this path of, of M and a is within six months, my client went from making 450, know, 450 K a year to 1.2. by acquiring this other company, you know, basically 1.1, 1.2 within six months.

5:35 Right. And so that's when it hit me. It's like, okay, yeah, you know, all this stuff I've been doing, we've been having success. We're doing great things with other business owners, you know, 10, 20, 30, 40 % growth. But this is 200, 300 % growth in six months. And so the concept now is to do that over and over again. Right. We want to create true generational wealth. That's what the wealthy do. They acquire assets on a repeated basis, specifically businesses. Um, I'm thinking about this exponential growth cause it's a comparison of you were training people how to do it organically and that's just take your own business, go deeper in your customer and market and brand.

6:15 You write, do some more, um, client acquisition build from within. And that's a grind. We all know it is right. And then you all of a sudden wait, there's an exponential thing happening. That must be the old physics background that the mass starts going off in your head. Right. And you're really starting to think, a minute, we're putting in 50, 60, 70, 80 hours a week, organically growing. We could take that same amount of time, 40, 50, 60, 70 hours a week, and we can two or three X our income in 12 months. Yeah. Yeah. And, and you know, the big, the paradigm shift is it's a reframe for business owners because up to this point, most business owners, when they think about business, they think about exactly what I was coaching them on.

6:58 They think about, I have to get a new operations manager. Um, you know, sales, need, we need to develop this new sales thing, client retention, uh, internal, we need to upgrade and buy this equipment. We need to do a new marketing thing, whatever, right? All internal stuff. It's a paradigm shift. It's a reframe and to think about business in a different way. And what we need to think about is how do I, first of all, my first step as a CEO is I need to replace myself. I need to get it so somebody else is running that business first. Whatever is your baby, that your baby. And here's the challenge.

7:38 We all have egos, man. We all got egos. We think nobody else can do it as good as good as I can. That's what I think. Right. And it's a huge limiting belief and it's going to cost you millions and millions and millions of dollars. So the first thing is work a lot of, believe me, there's actually a lot of limiting beliefs and internal work that some CEOs used to have to go through. And I used to have to coach them through that. So the first thing is to allow yourself to replace yourself, get out of your own way. And then you just really start focusing on acquiring other companies. Hmm. Um, isn't it funny that we have these to your point, egos and self-limiting beliefs? I mean, you put those together.

8:18 That's so contradictory. We have these big egos that we can conquer the world and then we're self-limiting. But the fascinating thing is, I don't know why every one of us running a business can't look around and say, wait a minute. I can't be the only one because there's other really successful businesses in my same segment. There's obviously people running those. Yeah. Yeah. Right. And probably a lot bigger. Yeah, so when you were doing business coaching and consulting, take it. The reason why I want to go back is because those same problems and environments that you were coaching then, they still exist today. As you look back, what were some of the one or two consistent problems?

9:01 Because I want to highlight that the issues and problems that a lot of, you're talking about, you said three to 4 million. There seems to be this three to $5 million revenue segment that people have a tough time breaking out of. It's really weird. It doesn't even matter the part of the country, but go back to one or two of the things that you reflect now on where people are stuck. You were coaching those CEOs. Is there an area or two, maybe you just go back to this, well, it's all about your own mindset. It's about self-limiting beliefs, but is there some practical things? Is there about bench strength? Is it about developing people? Is it better leadership skills? there one or two things that really stick out that you're like, man, this is really people struggle in this segment of entrepreneurship and business that needs to be conquered that they consistently dealt with.

9:45 Yeah, Mark, you hit the nail on the head. That three to five million range is, is really critical for a number of reasons. People get stuck there for that exact reason because I kind of like to think of business as a wheel, right? If I, if I have a wheel here, right, you got the, you got the frame on the outside and you have the spokes and in the middle of that wheel is the hub of the wheel, right? If you pull the hub of the wheel out, the tire falls apart, right? Well, three to five million, or I'll just say under five million. under three million definitely most businesses, the hub of that wheel is the owner. Right. And if you pull that owner out, the wheel falls apart, the spokes fall apart.

10:26 Right. So when, once you start getting above two, two and a half million and it's industry dependence, for some, might be more, someone might be less. Right. But the goal is to remove that owner, the hub and turn it into a business operating system. So a business operating system. That's also run with a people first mentality. Right. So, so you make decisions in the business, not just strategically, but you're also making decisions based on people. And what does a people first organization mean? So, so it needs to, so, so a people first organization with the business operating system, just like everything else, you start from the top.

11:08 You need to have, first of all, develop a true north of the business. And I know, you know, everybody talks about, mission, vision, company commitments, core values, right? Most people don't do it right. Most people go and they set up those, you know, they get all excited. I have a vision. have a mission. I have company values, but they don't do anything with them. They do that. They go through an exercise and then it sits on the wall. The best, and if you've read Good to Great, if you've read any of the great books out there, you know that the best leaders out there take that information and they become a parent of that information. Like literally, the best CEOs, the best leaders, they are constantly talking about their core values.

11:50 They're making decisions in the business based on their core values. So first of all, you start from a true north, the mission, the vision, the company commitments. And now once you've identified that, you start working backwards and you make sure that everybody in the organization, number one, knows exactly why they're there. They know exactly why they're there. They know exactly how what they do on a daily basis contributes to the overall mission, vision, and they're expected to, you know, align within the company core commitments, core values. A lot of people may overlook that, but it's a very powerful thing. It's a sense of belonging. It's a sense of needed.

12:31 You're needed here. Right. And then over and above that, how do we create that people first business operating system? Everybody needs to. feel like they have a purpose there. So the purpose is aligned, but now we have to have growth. Us as human beings, we have to have growth if you're not growing or dying, right? So we create a system where the business or excuse me, the person, the employee knows exactly what they need to do to get to the next step, right? So they see a ladder and they see that they're, you here's where I'm going in my business. my, or excuse me, my, my career, my first step here, I'm going to get promoted to this if I do X, Y, Z.

13:13 And then here I can go here and I'll make this much if I do X, Y, Z. And so they see that ladder. So they're motivated. They're motivated to do great things. They have ownership. have responsibility to the true north of the business. And then there's accountability around it. Every person has at least two KPIs, key performance indicators. And there's accountability and there's public accountability. have a team scoreboard. So there's all these things that, foundational things that are created. And then you, you couple that all together with routine quarterly meetings where we have a new strategy. And then we have weekly meetings where we have accountability around continuous improvement.

13:55 All of that replaces what the owner has been doing on a much, you know, a much different level. Right. So I'm hearing this and saying the majority of those businesses have not implemented this type of strategy. Exactly. And so, so without that kind of a system to kind of bring it back home, right, without that kind of a system, the owner can't get out of their own way and they'll get the stop at three, four, five million. And, and that kind of a system is what you need to have to be able to have a legitimate professional sales and marketing program in place. Because tip it, most baby boomer businesses, most baby boomer businesses, they don't They, don't have any of that stuff.

14:38 And if you ask that boomer who was looking to retire in the near future, he didn't need that. Why? Because they didn't have any kind of a formal marketing system. Most of these guys do a lot of referral, referral. And this is one of the core things about our M and A program and our growth and scaling program is that most of the, or one of the opportunities is that most of these businesses. They didn't have any kind of, uh, it was all referral based marketing. So they might grow 5 % per year. But that's okay. The baby boomer didn't want that though. He's had, he's been owned this business for 30, 40 years. He's complacent for him to turn it around, him or her to turn it around to something that would grow fast, 30, 40, 50 % growth would require a lot of effort.

15:22 And so they just stay kind of stagnant. They get some new clients, they lose some clients. They're in that three to $5 million range. So what we do is when we work with these companies, we come in, we acquire them. The first thing is we work on the back end of that business. We get it ready for scale. We put in the business operating system. We create a people first environment. We might even have to do some things on the product. We may have to look at the unique value proposition, pricing strategy, all of that stuff. But once that's in place, now you have a business operating system that's ready for scale. Then you go and turn on your sales and marketing engines and you fire away. Yeah. So there's the opportunity, you know, I'm in the real estate business, right?

16:03 You were in property management as I built also a foundation of net worth on acquiring real estate, this term value add. lot of people don't, if you know what that word is, you're buying something for less than what it potentially could be with some improvement. Right? So you're, you're, you're acquiring an asset at its current low value, but then there's something you can do to the property. You can lease it up. You can improve it that by doing that, the values X you're doing the same thing with companies. Absolutely. Yes. Yes. That's exactly what we do. We do. And there's a, there's a couple of others. So, so how do we buy a company and create enterprise value, right? You can create enterprise value by doing things like you said.

16:47 Um, well, okay. So the value of a business, right? Just from a high level standpoint, the value of a business is equal to EBITDA times some kind of a multiple, right? Yeah. uh One and a half to five, who knows the industry. Take some AI business now, might value a stock at 10 or 20, but that bubble will pop at some point. But let's just go two to five. Yeah, yeah, whatever. It's industry dependent, but it's also size dependent too. So, so if you have a real small business, that multiple is going to be really small. A bigger business is going to demand to hire multiple. So there's things that you can do on that front to increase the multiple. And there's things you can do to increase obviously the profit, right?

17:29 But one of the, one of the things that we really focus on is, what's called a roll up strategy. And that's, and that's multiple arbitrage. And when. We're a small company. Uh, we're only attracting non-professional buyers, typically other buyers that are smaller companies. And so the multiple small, right? So for example, let's say it's, um, a company doing, you know, $3 million. You know, let's say it's, you know, I don't know, 500,000 in EBITDA something like that's just an easy number, right? Maybe it's like a $2 million company, 500,000 EBITDA. ah The multiple for that to acquire that company maybe is a three, right? So let's say you pick it up for 1.5 million, right?

18:09 Well, you can create enterprise value out of thin air utilizing a roll up strategy or multiple arbitrage. So what you do is you acquire 10 of those companies. Let's just say theoretically you bought 10 of those companies, but you don't even grow them. You don't do anything on the backend. You just put them under one umbrella. Just by putting them under one entity itself, You now are going to attract a higher level of buyer, a more professional grade buyer. And those are called private equity companies or maybe a strategic buyer. But here's the thing, what ends up happening is remember what I said, the multiple is mainly dependent on the size of the company. So a company this small, we bought it, it was a multiple of three.

18:53 So 500,000 EBITDA times three equals 1.5 million. Well, I went out and bought 10 of those. So I spent 15 million, but I put them under one umbrella. So it was 500,000 of EBITDA times 10. now have 5 million in EBITDA. That multiples like a six. Wow, that's awesome. So the value, the enterprise value went from 15 million to 30 million. Now it's not, it's easy, but it's not simple, right? There's a lot of work and ideally those businesses all have a common structure. They have a common operation. You know, they're doing things similar, right? So you have to, there's a lot of coordination there.

19:34 You don't necessarily have to have a brand though. You don't have to be all the same brand. They can keep their own branding depending on the private equity you sell to. So that, so for me, that was huge. Once I learned that this existed, right? Because everything we knew before this is, business, I you know, I'm going to get a new sales guy. I'm going to do marketing, this product, this, that it's all internal to your company. And when you start backing up and start realizing that this exists, you start figuring out, okay, I need to replace myself so that I can focus on, yeah, I'll still do be involved with high level for my company, but I need to replace myself so that I can focus on acquiring. multiple companies. What's the best approach to yes, they want to employ a Patrick Rogers to be their strategic advisor and their M and a guy, but what's the approach if I'm freeing up my time as a CEO and actually just went to Boston and hung out with another real estate guy, it was all about M and a, it was all about acquiring other brokerages and right.

20:29 And so he's doing a lot more of it and he's realized too, he can do traditional recruiting or he can grow at 40 and 50, 60 agents at a time by these acquisitions, right? And he's learned a ton and He opened up the playbook specifically about this industry. Here's everything they've learned from their 10 acquisitions, not just about M &A. So they're specific. There's all specific things to learn about these industries. That's the brilliance and the value of you, right? The things that you've learned that on your first three or four or five that you're to have to learn and make a lot of mistakes on. When you're looking at, if I'm freeing up all my time as a CEO, I'm making an argument. I'm a relationship guy. I'm, I guess I'm assuming that I need to be out here creating relationships.

21:10 to start targeting these businesses on who do I want to partner with instead of acquire, right? um And I'm assuming that's where the time has to be spent. Building these relationships out in the marketplace or no. Yes and no. uh You know, I would ultimately say yes. so when we first started doing this, we got most of our, and you're referring just, just being able to find the businesses to acquire. But then, and it's striking up a conversation and who to talk to and see if it's a product market fit with all your businesses. It's to go out and spend time finding them.

21:51 Yeah. Well, there's two different kinds of deals out there. There's one deal, which is an on-market deal. So it's represented by a broker. The off-marketer of the best, Patrick Rogers, the off-marketer of the best. There you go, man. You got your on market and you got your off market, right? So we're going for off market and as much as we can, we'd still do on market just depending, right? So, so we'll do an on market if it's either a with an investment banker. And there's a difference between a broker and a broker is a realtor that sells business, right? You can probably market, you know, no offense, but you know, it's hit or miss.

22:31 You don't have to hesitate, just come in. is. Some brokers have their head up there, you know what, and other brokers actually take time and consider it their craft and actually do it right and know how to price the business. What we find is most brokers are 30 to 40 % overpriced of what will actually get qualified with a lender to even be able to fund the deal. And so, you know, we see that a lot. So if we work with a broker, typically, depending on the brokerage, but typically it's going to be something that has what I call season. The business has been, it's been on the market. It's went into LOI. It's been kicked out of LOI as letter of intent. Uh, it got kicked out because it went to the lender, the financial institution to get a loan and they, they underwriting disapproved it because it's not going to cashflow.

23:18 And they said, well, I'll prove you, but you need to come to the table with another $600,000 in addition to the 250,000 you're putting out, right? It falls out. then the, then the seller is like, okay, well then the broker comes to us. Well, you know, this, that, so let's take the price down. the, so the price has to generally drop two or three times before we get interested or get involved. Um, and then there's investment bankers and they're a different breed. There's, those are companies out there that are there. Those are professional and A people who know how to price a business. So we'll work with those, um, all day long love them. Um, and even better than that is off market deals. because now there's no representation from even investment banker and off market deals.

24:04 They're great. They're fantastic, but they're hard to find. so, what we do is we go out and we're doing massive email marketing. Like if I would, I mean, how many, I can't tell you how many calls, text messages and emails I get on a daily basis now. Do you want to sell your business? It's insane. Yeah. Yeah. So, so you're getting out. so emails, we're doing LinkedIn strategy for our clients. So, so our clients partner with us. We have our team gets into their LinkedIn, which is nice because, you know, a lot of times if you're in, if you're in Cincinnati, right. And we want to buy a business in Cincinnati, your LinkedIn is already in Cincinnati.

24:44 So we hop in there and we, and so there's a level of trust that's, that's, that's there. And then, you know, I'll come back to the investment bankers just real quick. It is that. Those are really good too, because sometimes we'll get what's called a pocket listing. know you've heard this before, right? And so listing, once you develop those relationships and CPAs are great for this too, you know, tax attorneys, you develop these relationships and they know that you're going to carry forward on it. You say what you do, you do what you say, all that kind of stuff. And they trust that if they send you something, you're going to actually make it, make it happen. Right. Or let you know one way or the other. And so. m And have uh they also pseudo underwritten the deal as well?

25:25 They're bringing it to you pretty much saying, know we can get this done. Yeah. And that's a beautiful thing about investment bankers. Like to your point is they're actually getting in and looking at it on a much level. They know what to look for compared to some of the brokers on the market. Um, so on your website, I'm glad you, I think you almost said a curse word, but you didn't, but you actually refer to that as some of your basic principles, right? You're not allowed to hang around with me much then, because I might drive a word or two, but what, what, of the things on your websites, one of the three significant, um, statements, it says focus on returns. It says, if we believe a specific course of action leads to higher, higher ROI for our clients, we pursue it. If not, we don't.

26:06 This principle is the basis for every decision we make. Absolutely. Yeah. Yeah, absolutely. And that again, that really comes back to, you know, some, some, we also understand, we want to understand to each one of our clients that we talk with, we need to understand what's important right now. Is it, is it upfront cashflow, immediate cashflow that's important? Are you okay with long-term, long-term game? Cause sometimes there's some deals, some decisions that we're going to make that will work for some clients and will not work for some other clients. So, but yeah, ultimately when, when, the day is done, everything we do revolves around the return on investment for our clients.

26:49 And so it could be something that maybe, maybe makes us a lot of money now or a little bit of money now and a lot more down vice versa. But if it's the right answer for the client, we're going to do it. Isn't it funny that if you go back to, know these stories of all these elite gurus, but you know, back when old Charlie and, and Warren and you know, when Warren Buffett met Charlie Munger who passed away. Warren was buying companies and tearing them apart. What was left over. So he was buying these bad companies, but he went in and saw that I can make some money on them. And he gives credit to Charlie Munger to slow him down and say, listen, I think this is the wrong strategy.

27:30 You should actually go buy good companies for a fair price instead of stealing bad companies. Right? What does that do with a mindset in this and A and world saying that there's a different way to evaluate these different companies? Because. You could take a company in the same industry and we might say, well, this company, either this is the multiple, but it might be a different multiple based upon the company. Is that true? Like, cause if you take a profit, profit is not the same. If it's a bad company or if it's a well-run company, is that true? Or do you disagree with that? No, that's a 100 % truth. em So when it comes to that multiple that, you you take two separate companies, right?

28:12 And again, the value of any company value is equal to EBITDA times some kind of a multiple. So now we have two companies, company A and company B that have the same exact profit. You could have one company that has almost twice as much value as the other company with the same profit. And so the things that we're looking at there is there's so much that goes into it, Balance sheet, all types of stuff, right? I there's so much. Yeah. What's their trajectory? Are they on an upward trajectory? Are they on a downward trajectory? That's huge. uh How involved is the owner? the business operating system set up such the owner's not doing anything? How much of that profit? This is another big one. you know, obviously, you know, as you know, we do &A services for people.

28:57 So we find and acquire the companies, but we also grow and scale the companies as well. So a lot of our clients, they don't do anything. They're just investors. then, so we have an arm that that acquires it and we have an arm that grows and scales it. But um one of the things is that, oh gosh, I forgot what I was. Yeah, that's right. No, we were I think we're talking about the value of companies and taking two companies. Yeah. yeah. Yeah. The two values of company. you, so you have company A and company B the same profit. And so when we acquire that company, um, if one company doesn't have, and so, so this is where I was talking about is when it comes to exiting a company, anybody out there, if you have a company and you don't have what's called recurring revenue.

29:42 Um, and this is the, this could be a huge difference in value to company A has no recurring revenue. Company B has. a lot of recurring revenue. what that is, you know, let's just say 50 to 80 % of that revenue or profit is due to recurring. So you don't have to sell every time it's on like a, you know, it's an annual contract or whatever versus this company here every year they have to go out and acquire new clients to make sure that they hit that nut, right? And if that comes from the person who owns the business and that's gonna be a vacuum when that happens. a whole nother, that's a whole nother game. Yeah. was just talking to, you know, forget even that part of that. I'm just talking about recurring revenue versus non.

30:23 So that's what we were talking about is, is profits are not the same, you know, company A and company B. That's another one is, is that huge recurring revenue. Other things that you look at in a company to maximize the value when you sell it is the bookkeeping. If I take, I, we have to turn down so many companies that we look at acquiring, even though they're on paper profitable, but because they didn't have clean accounting and they didn't have, um, taxes that were done in accordance with what the profit statement on their, their, you know, their internal financial says, whenever you have that discrepancy, you have, you have a company that's not going to be able to, it's not lendable.

31:07 It's very hard. It's more difficult. It makes it very hard. so that's one thing anybody can look at when they're looking to exit is. to maximize their value and make it so you can sell is to clean up your bookkeeping. Make sure it's on, it's being done in accordance with gap principles. Stop doing the ad backs for two years before you sell or minimize it. Right. And you want to make that internal P and L, you know, whatever your net profit line is matched with what you're putting on your 1120. Right. You have those match and everything is on the up and up. You're to be able to claim the maximum enterprise value when you sell and it's going to be able to get funded. So when people work with you, I'm sure that you have clients that does anybody come to you and say, Hey, a new relationship, say we're looking to acquire 10 companies at this revenue in this segment.

31:53 Will you guys go out and find the businesses and take care of the entire transaction? Like, that in the scope of what you do? Yeah, yeah, you bet. Absolutely. So part of, part of what we do is, and this is, I thank goodness for my partner, Robert injuries. Uh, he's actually in Romania and the guy's phenomenal. actually had him on my podcast. used to do, a podcast a few years ago, had him on the podcast and he shared with me what he's been doing for the last 20 years. And for the last 20 years, he has been coming into his clients and completely autonomizing the business and taking over and putting in a, putting in that business system for people. So I've been coaching people to do it. He's been doing it for people and that's why we partnered. such a, it's a, it's fantastic match, but that's exactly it.

32:36 So now we have, uh we have our clients inside of Elkridge advisors. He's done that. He's created that. Autonomized, business. So it's completely scalable. So we are infinitely scalable within our business. And so now any company that we go into, we just do the same thing. So we have the processes, procedures. and everything built up that business system for how to autonomize a company. Well, we've done that in our business, right? So the same thing that we're preaching to other people we've already done inside our business. we already have the infinite, you know, scalable system in place. All right. Speak to people who want to be, um, they want to acquire these companies.

33:20 Let's say someone has never been an entrepreneur before. They had a really successful corporate career. have a 401k. They might have a million or two in net worth. Speak to me about the level of success or failure of that person acquiring a business when they're a first time entrepreneur versus building it. Do you have any experience here? Where's your mind go? Yeah. So my mind immediately gets brought to a lot of our clients. A lot of our clients are actually, I'd say it's 50-50 between existing business owners who want to scale and grow through acquisition. And the other 50 or whatever percentage is corporate executives, know, professional men or women who have had their 20, 30 year run.

34:07 They're making 200, 300, 400,000 a year. And it's very successful, right? Maybe they have a net worth of somewhere between two to $5 million. But guess what? They're still in the grind. You know, they're still in corporate America. They're still waking up at five in the morning. They're still, you know, maybe working for a boss they don't appreciate or, or there, or even if they're not, but they're just still doing the grind and they, they've come to a maturity level. And this happens a lot of times when we get in our forties, right? Maybe forties, fifties is. We start to really understand, okay, I've been spending my entire career, even though it's very rewarding.

34:48 I've raised my kids, you know, they're getting close to being, you know, moving on. I don't need to put as much attention there. can start thinking about how do I create wealth for myself now? And I have the assets to do it. Right. So that that's a major thing is I don't have as much time with the kids. And this, kind of, this avatar kind of fits a lot of, a lot of our clients where it makes sense. They've got the $300, $400,000 to put down on a business. Whereas before they didn't, they have a little bit more bandwidth and they're starting to think about, okay, when I'm done and my kids are off in college, I don't have to stay here anymore. I can maybe move wherever I want. I want to start traveling with my wife or my husband or whatever that is.

35:31 But, man, I've never done this before. I've never grown or scaled a company myself. So I know how to do, I know how to lead people. So there's a lot of unknown that comes into business ownership that we're able to help people bridge that gap. So now we work with them, they have the assets, they basically become, it's almost like a small private equity company in a sense, because for that client, they become the money partner. It's the loans in their name and the businesses in their name, they own it. And we come in, we find the business, we help them, we do the 100 % done for you acquiring it. And then we grow and scale the company for them.

36:12 And they're just involved on a quarterly basis. And so we take, we remove all of the, the gaps that were there between what they're doing now and being able to have that, that, uh, business ownership. Is this a not to dig too deep here? I'm sure that when you renew clients on, but is this an equity position that you guys take to grow the business? I'm assuming that's what it is in a lot of these scenarios. Yeah, yeah, you bet. take, you know, just depending on the scenario we take it, we take a small equity slice and then, and then, you know, we are, you know, a traditional and a firm mark, a traditional and a firm will do something like five, you know, 10 % whatever of, uh, as a success feed to help somebody acquire a company, traditional and a firms, that's where they stop, right?

37:00 They don't help them grow and scale. Um, and so we, take that number down to almost nothing and then we partner with people on their growth and the scale of it, right? Our clients all have the decision-making, 100%, they have the decision-making capability. We are the general managers, the operators of the business in growing and scaling it. The, you talked about an autonomous company. What hits in my brain is this hot topic of passive income. And I love pushing back on it because I look at the trajectory of my wife.

37:40 I might be the example on how not to do it because I hustle and grind it. But a lot of people do look at the success I've had and say, that's really successful. I pushed back as I say, Hey, I'm not there yet. However, There's nothing about my businesses that are passive and we could make an argument that I'm doing it wrong. have awesome leaders in my company, but it doesn't feel like I'm the spoke in the wheel because I have multiple businesses and those wouldn't be growing if I was the, if I was the middle hub and all. Right. Right. So, but I'm still essential, but if I weren't plugged in, the business would lose something. And I think same thing with Steve jobs, pull a Steve jobs out of a company, pull an Elon Musk out of his company. What they've talked about is what would happen on the stock hits of the companies he leads if you pull an Elon Musk out.

38:27 tell me what autonomous is and how that connects to if we're sitting here, if we're talking about passive, because I can't imagine like I'll go to Europe for two weeks, but you hear, I'm going to say a name. I didn't even mean to do this. And I try not to from the book, but before he was in politics, people read this book called the art of the deal. Sure. And I'm wanting to say the guy's name because it's just so toxic now and how people respond to just politics. But, um, he talks about his businesses started to suffer when he spent too much time in Europe. Yeah. So talk about this autonomous. Am I, are we talking passive? What are we talking about here? Yeah. Yeah. Great question. So, so our partners, we still want them to be involved.

39:12 A as much as they want to be, right? Because there's some people that just have that innate desire. need, I want to be involved. I want to be connected to it. So what we ask is at a minimum, they're there for the annual meetings and the annual strategy meeting. That's a, you know, it's a two day event. You know, we spend a day and a half, uh, working on the strategy and then, you know, half day doing something fun. And then the quarterly meetings are every 90 days. so we ask our partners to still be involved. However, what we're coming, what we're talking about here is when it makes, when it comes to making strategic decisions, when it comes to how to really grow the company. Well, between Robert and myself, we have over 50 years of B2B, B2C experience.

39:58 We know we've been through it. Right. We've made the mistakes already. We've already hired the wrong companies. We've already done all of that wrong. So we have now strategic companies that Robert and I are both owners of that we've been able to help mold. One's an AI company. We have an AI software company that we're putting in all of our companies. It's phenomenal. We have a business operating system, like a project management, like a, like a Monday. We have another company. It's a marketing company. So. All of those things, instead of having to kind of reinvent the wheel, right? We've been there. And so we're heavily involved in every aspect of the business.

40:40 So we have someone that runs the business on a day-to-day level, right? Just like you do. And then we oversee everything else. And as we grow and scale, just like any other company, we already have the infrastructure in place to put other people in as we grow and scale to replace us. to make those decisions. And these are going to be people with X years of business experience. And so it's a very, very scalable event. So, number one, we have things in place to make sure that we have, like you, Mark, if you take two weeks off, sometimes you could, too much of that in a row, you can start seeing an issue. um But also we invite our partners to be very involved in the direction of the business.

41:23 Hmm. Um, what are you guys, I'm envisioning you talk about being a fly on the wall between you and your partner about the true intentions of the business conversations, what you're trying to do, your purpose, your why. Where's that weigh in? Well, interesting question. My answer is probably not going to be what you'll expect. Robert and I are both uh religious and very spiritual. My purpose in life has absolutely nothing to do with what I'm doing right now. It does. It has nothing to do with mergers and acquisitions per se in business.

42:07 My purpose in life is that this infrastructure, Elk Ridge Advisors, is going to create absolute freedom. And it's going to allow the kind of the relation to it is it's going to empower and create Christian and spiritual millionaires. That's my goal. Now then, how does that bridge into what the real purpose is? I know that my real purpose in life is to help elevate the consciousness of men and women altogether. And so what does that really mean? That means driving as many people on this earth towards pure love that I can.

42:48 And so this is the financial aspect of it. to, cause as you know, you've read enough books, you know that the wealth is not something to be ashamed of. Creating true wealth is something to be very proud of because what does wealth give you? Wealth gives you the ability, resources to do amazing things in the world. And so the right people with wealth can do amazing things. So number one, I said it wasn't really connected. kind of is because it's going to bridge me and connect me to other people and I'm going to help them become very wealthy. And these are very, very good people who all are aligned in that front that we want to do really good things on this earth.

43:29 And then, and it's also going to give me the freedom to do. Um, yeah, when I ask questions like that, you're right. It's always like, Hey, you're not going to have the answer. Isn't going to be expected, but I don't think, but I think that's the source of the question is. Cause we all have these deep seated, what we feel is our purpose. And I think that letting that out more and being true to what that is for all of us, if we're honest, you're going to attract your people and you're going to write. I think that's really important because. Sometimes what I found is like you could have the most altruistic purpose and reason in the world and go out here and make a difference, but that might just not connect with someone.

44:15 And if it doesn't, I think we should be honest and transparent to say, this is who I am. And this is what's going to show up as I'm leading these businesses. Know what, know what you're getting into. And this is what we're going to build. And so I think too often people are worried about not showing the world who they are because the people that don't want to be a part of it, think that's the actual wrong approach. Hmm. Yeah, I love it. Well, because it's because it's not even a negative way. It's not that we're to be exposed. They're going to find out what we're all about anyway. Sure. Sure. Right. And so I think, don't be afraid of what you believe, what your purpose is, what you're trying to accomplish, because there's enough people for all of us to follow and do our thing with us.

44:55 em And, if, your purpose is aligned with helping them change their lives and wherever that's founded for, you know, your, your Christian morals and your beliefs and what that purpose is. Listen, they're a massive. amount of people that you can help change your life that completely identify with that. And I couldn't agree more. 100%. Yeah. And I don't think, and what's funny is like that doesn't have to be my purpose, right? It's funny. It doesn't have to be. And I think that being able to be in a room with people that can have conversations that say that's unique and different. It's not really what I align with. However, go crush it and do it because if it's aligned with doing good and helping people, I think that's what we're trying to do anyway.

45:40 At least the good ones, you know? Yeah. And let the bad ones be exposed anyway. So, yeah, they will. They'll get it. And I think, um, I don't, I don't think that we need to be out here. I don't have anything to prove to anybody else that isn't trying to do something big with us. So, um, what do you think? where's this in? So we're here at one o'clock, 11, 10 o'clock your time. We got to run. do too. Um, what do you think this is all worth? Like, I know you're the spirituality and you know, Christian that stuff matters to you. Is there anything beyond that at the end of our lives that really matters? And I'm, and I'm not trying to be all woo woo and stuff, but about this business, because we spend all this time we're sitting here talking, we engage with entrepreneurs, we travel, you help build businesses.

46:24 Are we doing it just because that's what we're supposed to be doing now? Or is there a bigger, is there a bigger purpose to this? Other than what you already talked about, about your beliefs. get, know, when we're 60 years old, when we're 70 years old, mean, Yeah. You know, it's interesting. I just had this conversation, uh, just the other day with my daughter is I've spent most of my life, right. Chasing that dream, chasing that business, you know, why to change the generational downwind of, of, for my children to do all the stuff that I talked about, right. But when the day is done. You know, it starts hitting you that it's all about the relationships, you know, the, the, presence, the power of presence, you know, Eckhart Tolle type stuff, right?

47:14 The, the, the power of being here and now, and just giving every situation, every opportunity with every person, just giving pure love and, and attention to it and, fostering those relationships, man. When the day is done, that's all we have. How we have. Hmm. All right. That's good. We, um, I like, talked a little bit of philosophy, right? We talked business acquisitions. Um, I think, um, we talked about a guy named Greg Reed, right? We both connected with a little bit. He's been on in the past with secret knock. Um, and we talked about before the podcast that you're in San Diego and you laugh at all of us that have bad weather. know.

47:55 There you go. you go. Click out sailing in December, man. It's all good. There you go. See, you just keep on, you keep on dropping the needles in the doll, man. You're just torturing. that's an invitation mark. On the invitation to sale in December in the winter. All right. Um, Patrick Rogers, elk, elk ridge advisors, really and a strategy, helping people build their businesses, change their lives. I'm assuming making impacts all around the communities that you touch. Love it, man. Thank you. All right, man. Thanks for being on.