Preparing for the Inevitable: Exiting Your HVAC Business

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About this Episode





Are you a business owner in the HVAC industry struggling with long-term planning and preparing for your inevitable exit?

We understand that it can be a daunting task to think about the future, but it’s crucial to ensure financial stability and freedom.

That’s why we’re excited to share our latest episode of the HVAC Financial Freedom Podcast, featuring certified exit planner Jeremy Pugliese.

D. Jeremy Pugliese, CExP, RICP, WMCP is a Wealth Management Advisor with Planning Alliance. Jeremy assists business owners in designing and implementing optimal financial plans. His areas of expertise are business continuity planning, partnership negotiations, business exit planning, and employee retention plans. He and his team are dedicated to ensuring clients experience the highest level of service based on a foundation of integrity, security, and follow-through.

By listening to this episode, you’ll gain actionable insights on how to prepare for the inevitable and exit your HVAC business with confidence. You’ll also learn…

00:20 Introducing Jeremy (Planning Alliance)

1:35 Jeremy’s Origin Story

4:00 The Moment that Sparked Jeremy’s Career Move from Trades to Finance

9:35 Why is Long-Term Thinking a Struggle for Many in Business?

13:12 Grow Your Business and Gain Freedom with Peer Groups and Strong Management

20:35 How to Check if Your Business Can Run Without You: Tests You Can Take To Measure Business Success

29:25 How to Determine the Value of Your Business for a Successful Exit Plan

37:07 Life After Exiting Business: What Successful Business Owners Want to Do With Their Time

40:57 How to Cope with Identity Crisis After Exiting Your Business

45:13 Book a Consultation with Jeremy Today

47:34 Wrapping Up

So, if you’re ready to take the first step towards securing your financial future, don’t miss out on this game-changing episode!


📢 Connect with us!

👉 Full episode can be found here:

👉 Join our FB Group:

📢 Connect with Jeremy!

📅 Start planning for your exit strategy today! Book a 15-minute phone call with Jeremy here:[email protected]/bookings/

🌐 For more detailed information, visit their website at:

#businessowner #entrepreneurlife #home #homerepair #heatwaves #ac #homeservices #homeservicesbusiness #hvac #financialfreedom #hvacpodcast #businessexitplanning #businessexitstrategy #exitplanning #retirementplanning #wealthmanagement #financialplanning


This podcast is for informational purposes only and is not affiliated with or endorsed by PAS, Guardian, or Planning Alliance and opinions stated are their own. 

D. Jeremy Pugliese is a Registered Representative and Financial Advisor of Park Avenue Securities, LLC (PAS). Securities products and advisory services offered through PAS, member FINRA, SIPC. Financial Representative of The Guardian Life Insurance Company of America® (Guardian), New York, NY. PAS is a wholly owned subsidiary of Guardian. Planning Alliance is not an affiliate or subsidiary of PAS or Guardian. California License #0L01672 This material is intended for general use. By providing this content The Guardian Life Insurance Company of America, Park Avenue Securities LLC, affiliates and/or subsidiaries, and your financial representative are not undertaking to provide advice or make a recommendation for a specific individual or situation, or to otherwise act in a fiduciary capacity. Guardian, its subsidiaries, agents and employees do not provide tax, legal, or accounting advice. Consult your tax, legal, or accounting professional regarding your individual situation. 

2023-150203 Exp. 02/25

Audio Transcript

Welcome to the H VAC Financial Freedom podcast, a show to help you create more revenue, profit and freedom in your life. Now, your host, John Victoria. Hello and welcome to the H VAC Financial Freedom podcast, a podcast focused on helping you grow your revenue, your profits and your freedom in your life. I’m your host, John Victoria. And today we are talking about Exit planning and we have a special guest here, uh Jeremy who will be um briefing us on the most important things as you’re considering an exit in your business, which is inevitable, right?

You know, all of us at some point are gonna be here anymore. We’re gonna want to do something different. This is something that’s inevitable. So we got a plan for it. So without further ado uh Jeremy, just well, a quick introduction to yourself and the work that you do. Yeah, good morning. My name is Jeremy PBSI. I’m a certified exit planner, um Wealth Management, certified professional retirement income, certified planner. So I’m a financial advisor. I work with Park Avenue Securities and a guardian. New of our firm is Planning Alliance.

We have multiple offices in the northeast and I specialize in working with H B AC plummeting blue collar business owners because that’s my background. So, yeah, that’s what I do. Thanks for having me. Love it. Welcome Jeremy. And maybe you can kick off with that. Um You know, how did you get into this business? It sounds like you had some origin stories in the trades. And so could you just talk like, how did you even get to where you are today? Yeah. So I started working in a family business when I was about 210 years old.

My father owns a commercial plumbing supply business where we sold a lot of commercial plumbing supplies all through New York. And I was there head sales rep for that. And I managed the sales team at one point, I did the logistics. So I would do the shipping and receiving and purchasing with them too. And then at night I would have my own, uh, plumbing business on the side. Right. So I started doing that and I did it full time for 210 years, you know, while I was in school prior to that, I did it part time for four years.

So, overall, I had 290 years, uh, working in that industry before I transitioned to finance. And, um, you know, family businesses specifically, right, are very emotional and there’s a lot that goes on. There’s a lot of, uh, there’s a lot of, uh, personalities, right? And we have to try and focus on principles instead of the personalities. Sometimes we’re running businesses. Uh, so, so, yeah, I, I saw a niche and I saw a need really, I saw a need for a lot of my friends where H V ac employment contractors and they owned businesses.

I was selling them their material and then, you know, they weren’t really getting, uh, the attention they needed to address these business planning issues. Wow. And that, and I, I think that gives you really an intimate look into how these businesses work because like you yourself, like you grew up in that business, you ran your own plumbing business as well. And I think that’s very unique because, um, you know, there, there’ll be some professionals that come in and they have no idea of the context of that business, but you really, you know, have that literal hands on experience in the business, which is unique.

Yeah, it’s really great. You know, there’s a certain language, right? And I’ve spoken when you’ve kind of been in the trenches and you know what’s going on and you know what it’s like early morning, uh to try and coordinate your guys and see what kind of work they’re doing for, they’re gonna do for the day and make sure they have all the material they need, you know, organize your warehouse, manage your inventory. Like there’s a lot of different components, right? That make these businesses profitable and makes them valuable and uh it definitely is a value to have spent so much time in the, in that.

So, yeah, it’s amazing. And so you said after it was like 22, 212 years, you then transitioned into um financial practice. And uh what was the inspiration? Because it’s like you were in the, you know, the day to day, you know, in the trade jokes on that, it sounded like you found an opportunity was, was there like a story like an inspiration moment that like, really like, hey, I really wanna do this and this, I can see the impact that this will make in companies lives. Like, what was, what was that, that, that reason or that seed that, that blooms for you?

Yeah, one day, um, I went to go visit, uh, at that time it was a customer, right? He was an H V AC uh, mechanical contractor that had about 153 guys working for him and he had a sign on the door and he just, that was it. He folded it up. He had, was tired of dealing with the employees. He was tired of dealing with the customers. I would say, uh, back when this happened, the gentleman was just about 215 years old, right? Uh, it was a family business that he had inherited from his father and it was successful, but he just got sick of dealing with, um, dealing with the stress of it.

And also he didn’t really see a way out so he actually kind of gave everybody severance and shut it down and liquidated everything and he went to go work for a municipality to get a pension. Right. So you think about it like this is a guy, second generation business was really well regarded in the community, then he didn’t see it like an end in sight where he could have some guaranteed kind of retirement with his own business. So he just, he just called it a day and went to work someplace that he could get attention.

Uh And, and I think if you, if you really consider right, the details pragmatically about that trip, that, that, that story, it tells you that there’s a fear, there’s a fear. What am I gonna do with my business? How do I um how do I step away from it? I can’t be, you know, turning, turning tools every day for the, for all the way through. I have to have people I rely on, right. So I remember sitting there thinking, wow, this is like a successful guy and he just walked away from this.

And um and I learned then that there was a real need. I talked to other customers that I had back then other friends and nobody really had any planning place to allow them to, to, to have some freedom, right? It’s about freedom. That’s what it all comes down to. It’s not, you know, money is a byproduct of hard work. And freedom is a byproduct of money. Right. So a lot of times you might think it’s about money, but it’s really about freedom. People wanna spend the time doing things they love with the people they love and the goal is to help them get some place with their business where they can actually have that freedom. Right.

So that’s a beautiful thing. Right. You know, we all start, you know, whether we inherited a business or we started a business, we all have some goal in mind and it sounds like in this case, um, there wasn’t, um, you know, maybe it might have been a missing knowledge or maybe it was an, a lack of awareness of what could be possible. You know, someone made to the end of their, you know, their career, 220, 220 years in the trade that, that’s like around the average age right now, I think it’s around like 50, 55 years old.

So there’s a lot of folks transitioning out. Um And it sounds like you have to be intentional about how you do it otherwise you might not, like you said, not have this, this pension or something that really protects you in, in your older, in your older years. Um And, you know, all of us, we can’t work till the day. You know, a lot of us don’t want to work until the day that we die. And so it’s like, how can we enjoy some of those things in, in our retirement as well.

Yeah, I, and I think that’s, that kind of speaks to the topic, right? So it’s never too early, right? There’s like you, you started off by sinning. This is never, right. This is the, this type, this exit from a business is inevitable. It’s gonna happen, uh with a third party sale, it’s gonna happen with an insider transfer, right? Maybe there’s a, a young, another enthusiastic really smart employee that you say, man, I think this person could, could grab the reins one day, right? Or maybe you’re looking for that person.

But then there’s also, there’s also guys that I know that are passive owners, they have a management team, right? Their business, they’re still, they’re still going there and they’re working, but they’re not putting in nearly the hours they did, right? And they’ve built a management team or they’ve built a few people they can really rely on to run the business. So there’s like a passive ownership structure in place where they own the business, but they’re, but they’re not putting nearly the, the time or effort they did uh when they were younger, right?

And I think to build these types of structures and, and to, to really design this infrastructure, it takes time, you know, and it’s, it’s never too early to start. I think that’s really the uh that’s one of the key takeaways that I would offer, right? You know, you have people that the gentleman I mentioned he was in his late fifties or maybe mid fifties to sixties when he got frustrated. But maybe if he had started 5, 10 years prior to that, he, he wouldn’t experience the frustration that first for someone to walk away from their business, frustrated or to live a life going to their business frustrated that, that takes years to build. Right.

That frustration is a one day, like you have a tough day and then it just lasts forever. It’s years of going to work and experiencing these little frustrations because there’s a lack of structure and a lack of a lack of real support that that owner is getting with good employees. Right? So, so I think that’s, that’s a real important uh component we should discuss off that. And why do you think that is like, why, why are so so many people not thinking about, you know, this end?

Um like this is like where everything’s headed. Um Because I know a lot of folks when they first start their business, they’re like, I, I just wanna, I just wanna, you know, be my own boss, right? And that’s, I think that’s the first thing people might, might think of, um they might be very skilled, they might be a technician who’s really good with their hands and knows what’s to do. But um I, I think a lot of folks just don’t think about that. It’s like, why why is that, is, is there just something missing in?

I don’t know the education or is it just like awareness in the industry? Like, why, why are so people can’t think sometimes even further than the year. So, like, why, why not, why not the end? Yeah, there’s a, so there’s a saying, right, you’re working in your business or you’re working on your business, right? There’s a very common thought process and a lot of times people are really busy in their business, which is great. Right? I mean, the phone is ringing, we have work coming in, we have a backlog, you know, we’re looking to try and staff it to make sure that the material we need.

Hypothetically in these jobs is gonna be there. So it doesn’t delay projects, right? Because that’s a concern, the supply chain, they’re worrying about all of these day to day issues that could get in the way of them completing the job because when we stop completing the job, care stops and then they’re worrying about payroll. Right. So there’s all these different things that come into play. When do they actually take the time to sit down and consider what the long goal? Like, what’s the long play here? What, where, where am I really gonna be when I can’t do this work anymore?

Or maybe I don’t want to be here as, as long as I have been, you know, 14 hours a day, 56 days a week. Right. There’s so many little day to day issues that need to be addressed. Um, that very rarely, in my opinion, there’s, there’s, there are diamonds in the rough, but a lot of times, um, the average business owner, especially in H V AC plumbing, uh, electrician, they’re not, they’re, they’re, they’re very worried about that short term, day to day. Uh, hill, they need to mount and, um, and they’re not, you know, I would say another thing is a lot of people aren’t asking for help.

You know, a lot of people don’t have a good example, right? Get a coach, get a coach, find somebody that’s, that’s got an experience in business that knows how to, how to handle these types of things and set a couple hours a week aside and hire somebody that you can sit down and talk to, that you can talk these things out and then come away with some actions that are executable, right? Some, some things that you do a little bit every week, try and get things done, whether it’s designing a job description and putting ads out there to hire somebody or finding financing to make sure that you have plenty of liquidity.

If there’s, you know, a shortfall over there, there’s all these things that you can benefit from if you ask for help. But I think a lot of times people don’t ask for help either. Mm And kind of like echoing what you said it, it sounds like due to the urgent, I mean, people are just focused on the day to day urgent things. But you know, if anyone has read some Stephen Covey and you know, the urgent versus not important, important, not urgent uh like business planning sounds like one of those things that are, they’re not urgent but it’s like really important to do.

But because it’s not streaming at you to get it done today, like it just, it just becomes de prioritized because you got customers, you’ve got financing, you gotta take care of, you got trucks that need to be repaired. You got these changes in the industry with legislation and all these things that are screaming at you now to solve and um and it’s just, I mean, it’s, it’s the natural thing to do, right? It’s to, to handle the thing that’s in front of you. Yeah, I can tell you some of the most successful H B AC business owners um that I know, right.

And this goes across the trades. They’re in, they’re in peer groups, right? So there are groups where you might go to your local. Uh Well, I should say not your local but like your national or regional um uh trades organization, right? X Y Z, whatever it is for where you are X Y Z Contractors Association. And there are members that are sharing the same trade, right? They’re, they’re essentially doing the same type of work you do, but they might do it in a different geographical location. And I can tell you my experience, the people that really exit and have this kind of mindset, this bigger, broader mindset of, of making their business blossom and really turning it into an organization, not just a lifestyle business.

They’re in these, uh, these pure groups where, yeah, it requires time. Right. They might take four days, I can tell you a lot of them, they’ll, they’ll mean four or five days a year and they will go to a specific location where there’s a group of business owners, there’s somebody that might be the, um, the mediator or like kind of like the MC that runs it with an agenda and everybody will bring some information. There’s, there’s items they bring, right? And everybody will then compare, you know, there’s a, there’s a gentleman’s agreement.

Nobody that, that nobody really competes geographically in these situations, but they learn a lot, they’ll learn what software is working. What, what type of, of hr structure do you have? That’s really providing support to certain departments, right. What are the, how are you, what are you doing for your sales to increase sales during certain types of year advertising or marketing campaign? What are all the things that people are doing and do and at work and doing that at the door? Right. Those, those can be just as valuable.

So you don’t waste time or resources trying things that don’t work and we can learn that a lot of times from our peers. I mean, me, I’m in a study group, I’m in a study group with other financial advisers that are, um, that are in the USA. Right? And they focus on working with business owners. That’s what they do. Right. And there’s certain strategies and techniques that I learned that, uh, I learned from that study. Right. And that those kinds of principles and tools they transcend across industry, you know, H V ac plumbing, electrical contracting, right?

Like learning being open to learning from really successful peers. That that’s a, that’s a real good tool you can manage to, to harness it. So, and then the, the beautiful thing as well with, because I’m, I’m also very similarly part of these different uh peer groups or study groups. Um I think the another big value ad they provide is that they open up what you believe is possible. Um So like for me, I, I don’t come from a, a business background. I don’t really know it’s possible in business, but when you go to these groups where there’s people who are 203, 10, 15, 20 years ahead of you and they’re like, oh, wow, they accomplish this.

They’re doing that like they’re no longer working the day to day. It’s like, wow, that’s, I maybe I could do that too. So in addition to best practice, it just, I think it expands people’s minds So what can actually be done? The possibilities? You’re right. And it also, it’s gonna teach you how do you measure up? Because there’s, there’s a whole concept and thought process about, hey, I have this problem, how do I solve it? But then there’s a whole another side of the coin. How do I measure up?

What are the key indicators that I can track as far as profitability uh where I’m spending my money? Where? Right, as far as a percentage of overall revenue, where am I, what am I spending funds on? And how does that compare to my peers? Um And then what are the benefits that I’m getting from certain, from, from increasing my cash flow to certain uh to certain line items? What’s the payoff that I get? Right. So there’s these, there’s different, um, there’s different indicators that you can line up these businesses financially, take their P and L line them up side by side and compare and see where everybody’s, everybody’s different.

And then look at the results as far as profitability. You can’t do that unless you have a good relationship with other business owners. Right? Very rarely. I mean, you could, you could, there are certain codes that are provided in accounting, right? Where you can go to your CPA if they’re a good CPA and they can run reports. But even that is based on, um, it’s based on people that participate in surveys and studies. So those those kind of um uh comparison studies that you would do, don’t allow you to speak to the people that to ask questions where when you have maybe a mentor or a peer group, something like that, you can have real conversations about why did somebody, you know, increase their spending for marketing uh at a certain cost?

And then what was the outcome they had directly, you know, uh what’s the way they price out certain jobs? And how did they have such an increase in a certain specific line item? Right. Oh, you’re, you’re changing your pricing model with this one type of job because um because it makes you gain more uh work, right? You win more proposals. When you go against your competition, there’s a lot of little nuances like that that you can’t get unless you’re doing like trial and error and trial and error takes forever. Right?

So it’s not, it’s not the best way to kind of go about this. That makes a lot of sense. And um, and value other too is like you, you might feel like you’re a big fish, but you’re in a small pond. And I think being a part of these national groups, it gets you to realize, hey, maybe, maybe I’m really a small fish in a big pond and I gotta learn some best practice in terms of like you said, these line items, investments in certain things and um what to expect as well.

Yeah, I think and, and what’s the goal? Right? So if you follow those, follow these tools and you, and you can execute on the tools you are, right? Your business value increases you then, right, you start to get to a place where you can afford confidently to hire management, to hire people that will help you run the organization, right? Which then in turn increases business value again, because every time that I can as an owner, every time that I can put together a structure that allows me to separate myself from the business, it actually becomes this whole third party.

This business isn’t just based on me and my sweat. It’s based on a structure that I build. And when you start at the beginning of getting in communication and working with people that are your peers, increasing your business value slowly because you become more successful, then building a management team, right? Having those people learn from other peers, right? Because all those other, there’s other people out there and, and you really focus like help those management members that you, that you bring in, right? Your CFO S or your your head sales, right?

Your head of um receiving payable financials. So those people are gonna become your key employees over time, they are going to really run the business so that you can step away and a in time. And that’s, that’s like the end goal, right? Keeping the end in mind, freedom is the end goal, right. So, so yeah, yeah, that, that leads into like the importance of having a management structure. Hm. And so I guess as a simple test um for someone who might not have that in place, um I think a simple one I’ve seen in the past, like if I, if I step away from my business for X amount of time, like what happens?

Like, will it continue to run? Like, will things stop working or are there other simple tests like that to kind of? No? Like I just, I guess a gut check like this is kind of like where I’m at in terms of the the business valuation journey. Yeah, I think some of the, some of the other things you can do is see what becomes a bottleneck, right? So a bottleneck with work, whatever it is. What in your business? Are you the bottling? Are you the problem as the owner does everything need to pass through you?

And if it does, then you know, there’s a real issue. One of the ways you can also identify this is thinking about like your sale process. So if it starts with a salesman going and making a cold call or a phone call coming in, really document just on a notebook, sit there on a Saturday morning or sit there when you’re by yourself and think, well, what’s the step by step sales process and then go through being award of the job and implementation and, and really look how much of that are you involved in and put a little and highlight the times that you’re involved and if you’re involved in too much of it and the whole page is highlighted, then, you know, there’s a real problem, right?

It’s also gonna tell you, right. Think about it. Now, now I’m going through this process and I’m identifying what my, what my sales process looks like or, and, and then how that translates into like workflow, right? And installs or service, whatever the category is, I’ve identified that I am too heavily involved in the process right now. That creates concentration risk with my company. My, my company now experienced a concentrated and heightened risk because it relies on me as they are too much. And now what’s a byproduct of that?

Well, since I’ve identified where the pain points are, I’m really slowly building a job description for the person I need to hire right now, what is because you think, well, if I hire somebody, what are they gonna do, I’m gonna pay them. But what are they gonna do? Right. And then you can really look at, you go through this process and you can identify. Well, these are the places that I need help. These are the things that I hate doing. Maybe, right? As a business owner, maybe these are the top 10, top 10 things that I have to do that I hate doing well.

That sounds like a great job description for somebody else. You know, like, because that’s gonna keep me happy coming to work. Right. If I know that there’s these activities I don’t enjoy and if I could pay somebody else to do them and still make a profit and enjoy my life and enjoy my work, then I don’t, I don’t, I don’t experience that frustration that some people have right before they lock up the door, right? It all kind of goes back to, to what we started talking about, you know, uh having, having a plan and how do you really come to, how did it come to fruition?

So that’s beautiful. So it’s um and, and kind of what you just touched on it relates to your, your personal motivation over time. Um you know, exiting your business, it’s not gonna happen in a single day, right? It’s something you plan for far into the future. And part of that is your personal motivation as, as the business owner running the business if you become tired and frustrated and maybe you don’t see the, the full process through. And so I think kind of what you’re saying is, you know, we’re gonna build as you’re system identifying like what you don’t like to do and then see how can I delegate this to someone so that my personal motivation can stay at a higher level because I’m doing the things that I enjoy doing on a day to day basis.

So, yeah. And what you’re gonna notice too is, is that you’re gonna have, you’re gonna get reinvigorated as a business owner. Right. And I, and I’m, I’m, uh, so I’m going through this on my own, my own practice. Right. My practice has been extremely busy. Uh, so I had to bring an apartment. Right. I had to bring in a partner. He handles a lot of the things that, that don’t really suit my skill set. My skill set uh is more tailored to a certain set of activities.

And when I um when I execute certain activities, the business as a whole is very profitable and business comes in, right? When I’m spending my time doing these other things that I don’t like doing or then what do I do think about it? Even as a business owner, I don’t like doing. What do I do? I procrastinate, I push them off. I’d rather grab a t towards the things that I like doing. Right. And I’ll tell you for a lot of business owners that’s being in this deal, I have a significant number of H V ac business owners that, that have other individuals that deal with the operations, right?

They have other employees that run the operations office managers, things like that because they like going around to these real difficult H B AC jobs that are technical and working in the field with the crew to help them troubleshoot and to teach that, you know, teach our technicians, they want to be able to go in and teach the technicians how to, how to identify and fix these real problems because that’s why a lot of H G AC business owners got into it in the first place. They like to fix these problems.

They like to tinker and figure it out and troubleshoot and try it, then put, change something, try it again and then they get stuck in hr and payroll and insurance and all this other crap and they don’t enjoy that, you know. So, so that when I, you know, and that’s, that’s a very common thing. I see a lot of guys that build, that they would choose an o a passive ownership structure where they own their business, but they do have a, a set of maybe two or three key employees that are running a lot of the operations and it allows these business owners H B ac plumbing, electrical contractors to go on job sites, you know, and, and I think that kind of goes into the next portion of this. Right.

So now, um, now we started with making the business more profitable with maybe a peer group, a coach, working with somebody that I can talk to, like asking for help. Then identifying that I, I’m increasing my business value. I can afford to take on management. I can afford to, to plug in some individuals that will relieve me of these activities that I hate as a business owner. Right? The, the, the things that I, I may think that minutia but, but really they’re very important and they need to be done.

So then, right, what do I have? I have a business that’s profitable. I have a business that I could step away for a little bit. But I still, now my risk has been transferred on to these key employees if I lose one of these key employees, right? This risk still lies with them because if that something happens to them, death disability uh um departure, right from the organization, if I’m not taking care of them and, and there’s different, there’s different planning techniques that we would put in place, right?

So um bonus plans, right, based on profitability, incentive plans for these key employees, um making sure that there’s pro proper documentation with their employment agreement. So everybody understands what their job description is, you know, uh they understand that if they perform well, the business does well and we all make more money, including them, right? They, they have incentive plans and that’s where we really come into play, right? So for us, what we’ll do before I, we started this, I was working on an incentive plan design and that’s, and that’s something where we’re looking at.

Hey, what is the, you know, for this particular company, their fiscal year started October one, right. Well, where are we at? Year to date. What’s the target as far as revenue, uh, what’s our gross profitability? You know, and then, and then how does that relate to a pool? Right. So when I say pool, it’s, it’s a think of it like a big bucket of money that if the company hits its target, right. This big bucket of money gets divided along a handful of employees that are been identified that have been identified as key employees. Right.

The more money the company makes, the more it goes into this pool. Right. The company obviously keep the majority of the profits because it needs to operate. But there’s this, there’s these funds that get set aside and that allows everybody to kind of cash in on the success that we’ve all contributed towards. Right. So there’s different, there’s different tools that you put in place as you go through the process and you, and you do build a successful business that’s profitable with the management team. And now I can sleep at night as a business owner thinking, oh, well, I have his management team, I’ve done the right plan and something happens to them, you know, death, disability or, you know, dissatisfied. Right.

I, I’ve, I’ve, I’ve taken care to make sure that they’re hopefully not dissatisfied and, and, you know, we’ll, we’ll definitely cover all those risks when we work with the business owner. So that’s something that, that’s a, that’s a key component where we’re gonna come in and help. Um Another question that I get a lot and I think every business owner thinks about is that for that exit? Like how um in for the trades? Like, how does that formula look like? Right? There’s some multiple on uh on something.

So like how, how are people figuring out? Like at least an expectation? Like, oh, this is if my goal is to retire with this amount one day, how, how do I need to set up my business so I can get there? Is, is there like some rough benchmarks that someone can use? Like, hey, this is kind of what I need to get to if I want to leave the business with five million or 10 million or something like that. Yeah. So it’s gonna depend on a few different factors, right?

It’s gonna depend on the type of work they do, whether it’s residential or commercial, it’s also gonna depend on concentration risk of customer, right? Do you have anyone like if you, if 90% of your business is from the federal government and then the federal government changes a regulation that says that you can’t, they can’t do business with your type of entity. You’ve had a, you have a lot of concentration risk, right? Or if you say, well, I do most of my business with Amazon. I do most of my business with these big conglomerates.

You’d be surprised really quick that can dry out because maybe there’s a change internally in the way their, their, their development is as far as an organization and that trickles down to you as a trait. So, you know, there’s not, there’s not a real, I would say easy formula that you can just uh uh back your way into and like do it on the back of a napkin. It’s a little bit more complex. It also depends geographically where you are, right? What’s the competition where you are?

Do you have a captive audience? Because you know, you’re in the middle of the desert and literally, right? Like you’re, you’re in a place where there’s, there may not be a ton of uh competition for you. Well, then you’re gonna, you know, your business is more valuable, right? Because you kind of have your client base relies on you heavily because the next closest guy is far away. But if you’re someplace that’s congested and there’s a lot of competition. Well, you know, maybe you’re, maybe you, you, you, you really have to work a lot harder for market share and it, it might be a little different how a third party uh looks at the value of your business.

You know, I will say one true measure though. That’s for all of this because some of the topics I’ve been mentioned, like they apply to some people but not all but one thing that does apply to, to, to every business owner is that, you know, we got to start by looking at where your personal financial planning is. Right. Right. Like how do you live in your house, uh, with your family day to day and are you overspending? You know, are you, are you somebody that’s conservative? How much, how much, like a liquidity and savings are you keeping personally and in the business?

Those are the numbers that we would like to look at. Right. You know, we’ll look at our, our, what’s somebody’s cost of living and then we’ll use a specific multiple based on their characteristics and their demographic. And we’ll say, ok, this is like a sad savings number for you in your household, right? So that insulates them from maybe an emergency. Uh, do they have special, you know, certain insurance products like it? God forbid they become, uh, you know, disabled or unable to, to run the business. Is there gonna be disability insurance or are there gonna be, you know, uh, other products out there that, that’ll kind of absorb the risk?

Right. Um, so, you know, those, that’s, that’s one general, our rule I would say is that we start with the business owner’s personal finances because we want to know what’s going on. Right. So that we can, then we know how much they really need to walk away. That’s how you can tell how much somebody needs to walk away. Right. That’s the big thing. That, that makes a lot of sense, right. You know, if, if someone’s money, psychology says for every dollar I earn, I spend a dollar or if every dollar I earn, I spend $2.

You’re never retiring, you know, no matter how much your business is worth, you just overspend or spend it equal, you’ll, you’ll just run out of money. And so that’s a really good component. You have to put in context, the personal finance plan within also the business exit plan too. Yeah, because a lot of times you’re gonna have a gag, right? You’re gonna have a value it’s called. So let’s say like you, I identify what your cost of living is. I can add inflation, I can add in specific life events like, oh, we want to have another child or we have a young child that’s got to go to college, any of these specific criteria that we learned from, from doing our fact finding, right, then we can look at your business and see what the value is.

We can go to market and, and get a, a hypothetical um right, like we don’t do m and a work I don’t do specifically em meger and acquisitions work. I think it’s important. Everybody knows that, but we definitely um can introduce them to somebody that does M and a work and get a value on a very uh uh reliable value of the business. And by us doing the proper retirement planning and analysis and needs analysis that understanding business value you know, the, the customer can say, well, we need to increase the business value by a certain percentage over the next handful of years.

So that when we do eventually go to market, uh, we’ll, we’ll net enough after taxes and right after transaction fees and attorney fees and all that. Right. So we don’t give specifically, we don’t give tax advice, our firm, we don’t give legal advice. Um, however, we do work with clients to go through this process very frequently. We have a lot of exposure to these transactions. So so that there’s a lot of value that lies. I love that. Um That’s, and that’s, that’s beautiful. It’s like it’s not something that again you can do in a day, but you need to work with someone on this, like especially, I mean, a lot of us haven’t, you know, for me specifically, I haven’t, I didn’t grow up in a business at all, not knowing personal finance as well.

These are things that you have to build over time and many times the shortcut is to work with a professional on doing a lot of these things because it’s, it’s gonna take a lot of time because you’re doing that. Plus you’re trying to manage the day to day in the business as well. Yeah, especially, you know, for me, I, I really look at um credentials, right. So if you’re gonna work with somebody in these areas, it’s valuable to know that they’ve got the education and then if you’re very lucky, right.

The, the personal experience because those are two. So, right. Education is something that anybody can go to school and learn. But then when you couple that with your personal experience, there’s a certain level of wisdom that somebody has because they’ve been in it and now they’ve also learned the education about around it. Right. And there’s a deeper understanding of wisdom that comes with that uh education and experience. So when people are looking for an advisor, I would encourage them to really uh to really probe and ask questions, like, like, have you worked with somebody in my indus?

Right? Have you specifically gone through this process with somebody in my industry multiple times so that we’re not gonna, you know, look back on this and say, oh, we made a mistake because we didn’t know, you know. Um and like, for me, the same thing is I have colleagues that, that will work specifically with like a video game manufacturer or video game design firms or other industries that I don’t, they’re not my specialty, right? It’s not my specialty. So now for me, I might bring one of those individuals in if I have a client that’s in one of those technology fields where I don’t have a deep understanding, I’ll bring in, I’ll bring another advisor and I’ll bring an o advisor and that has an understanding of, of that uh that, you know, that uh industry.

So it’s awesome. So, experience as well as the actual, it, it sounds like the book as well as the street smarts to put, put it. That’s exactly right. Yes, you got it. And um and maybe just uh also just paint a picture for the future for folks. Like what does, what would a hypothetical situation look like if someone did their exit properly? Right. You know, they did everything that he talked about. They built the management structure, they built out the processes, the job descriptions, maybe they’re now, you know, looking to exit.

Like what is, what is the success will exit like look like? Yeah, so we’ll go back to the beginning of when we started talking about this, right? During our show here, uh uh the freedom, it, it ends up with, it ends up with them having freedom and being able to do the things they wanna do with their time, right? They’re not, people start a business like you said earlier, people start a business thinking they want to be their own boss. But the truth is is that when you’re a business owner, the customer is your boss, right?

The customer is the one that’s dictating where you go a lot of times and where you’re spending your time, right? Especially if you don’t have people you can rely on and you’re a business owner, you’re the one that’s got to go there, nights, weekends, holidays. So, so for somebody that has successfully done this planning, they are slowly noticing that they have more time. I can tell you there’s business owners that I work with will they? And they will look at me kiddingly and they’ll say, well, what do I do with my time now?

They’re saying that like tongue in cheek, right? Because part of the conversation that I have with people is I ask them like, what will you do with your time? Right? Some guys say golf, some people say babysit my grandkids or travel with my wife or whatever it is. Part of the conversation we’ll have in the beginning is we want them to understand what their life will look like when they get to do what they want. Right? If you could do what you want. Like I have a guy, he said, look, he collects old cars.

He would love to get in these old cars with his wife and just drive around the country and, and go and trap. He doesn’t like to fly and he, they don’t wanna go, you know, but they love to get in some of these. He’s got old Porsches and he’s got old, old, uh European cars that he loves. And he’s like, we’ll get in those cars and we’ll drive around and we’ll go and visit and just see the countries and that’s what they do, right. They spend a certain amount of time doing that because for the last five years he’s been putting in a management structure and he’s been doing his own personal financial planning.

So he doesn’t need to make the same amount of money off the business that he wants to. Rightly, he doesn’t need the huge distributions to pay for things because we’ve been doing financial planning, we’ve been paying more of his debt, we’ve been making other solid investments, right. That, that he can rely on now to provide him income so that he doesn’t need, he can take some of that money and say, well, I don’t need to make X, like I used to, I can take a little less from the business.

I’m gonna hire somebody and I’m gonna get my freedom because I, I’ve done all of this plan. Does that make sense? You thought? You know what I mean? Like, like it really starts at home for a lot of owners. We really got to sit and talk and really get an understanding of what they’re doing with their personal finances. You know, that’s because, because that’s where they lived, that’s where they live, they work at their office, they might feel like they live at their office, but they really live at home.

And that’s, that’s when they exit, that’s where they’re gonna be. So we got to see what their personal home finances look like. Awesome. There, there’s two things from that. So, first for anyone who’s listening, um, we, we interviewed a few, uh, successful contractors who have exited in the past. Uh check out the episode with Justin and Kristen Dees. They actually took the episode on their, on their yacht and they were just enjoying, you know, sharing insights and stories. And the thing that I loved about them, part of their retirement journey was to take their daughters, they were still in high school and just, you know, travel around the world, go to these different ports and give them a more worldly education before, you know, they left the home.

Um But great. And then I think the second thing which you brought up is that I’ve noticed that some business owners can have an identity crisis once they exit the business. Um because they’ve a lot of potentially their self worth has come from, you know, working the day to day of the business solving problems and being known as the boss or the owner. So how, how, how do you help coach someone? So you mentioned like identify a few activities like golf and things like that, but that identity transformation, I, I, I think that’s, I also see some business that are just go straight back to work, you know what I mean?

So what, what do you uh in terms of coaching, like, how would you advise someone who is like that identity transition? They’re gonna have this, we got to get a sense of their purpose, right? What’s the purpose? Why are they? And like you said, some people do choose to still work in the business, but they’re doing it because that’s their passion. They love it. Right. They want to teach a younger generation. They’re not getting mixed in with the day to day operations. They’re looking at all the jobs and they’re saying, oh, instead of me working 12 hours today, I’m gonna spend an hour. Right.

And I’m gonna go to this one job where we’re having a complex issue and I’m gonna go work with the technician that’s assigned to it and then they’ll show up on that job and work with that technician for a few hours and maybe they’ll go have lunch or whatever they’ll do, they’ll do it because it’s what they love. Now, I will say when it comes to having your identity tied tightly to your business and especially, I’ll say there’s a distinction there, a gender, right? Uh My experience is that men do that, but that’s a significant, um, that could be a significant barrier to exit, right?

Is if you have too much of your self worth and your identity tied up, uh it’s very, very healthy when you’re building the business, right? Because you own it and you, you take it on. Uh and that’s why businesses are successful usually because the owner takes it on and they, they really have this extreme ownership. But then you have to trans, you have to like transfer that to something else, you know, and for a lot of people, um, I can tell you we have business owners that will do a lot of, uh, community development. Right.

So, so they’re finding things that they might think are wrong with the world and they want to fix, you know, and that could be like in their local communities, they see that there’s an underserved population or, uh, maybe there’s a health care concern in a certain demographic that, you know, it’s close to home for them and they want to go and they want to spend their time making a difference by volunteering on boards or, or, or, or anything like that in their local community. We really encourage that and, and I’ll tell you the trick for me.

I noticed that in the beginning when we start to transition to own or out of the business, slowly, we will couch those conversations about branding. We’ll say, look, it’s very good for you for the brand of the business to go out and be a member of the community and volunteer. And they’re very even then you’re like tricking them, let’s say to like, because their identity is tied in this business. And they say, oh, well, I’m still helping the business because it’s true. But really, they’re slowly, they’re slowly falling in love with helping the community and it gives them a whole another sense of meaning and it allows them to exit in a real graceful way and still meaning they still have me Right.

So I can tell you that’s something that we do very frequently is what we talk about community service, giving back to the public. Right? Especially if these people are successful because they feel that there’s a sense of uh uh a sense of, of, of um gratitude they have for being able to, to be financially self sufficient and independent that they’re like, oh, I should pass it. Right. So general will want to give back that most of the really successful business owners have. I love that. Yeah. And I definitely resonate with that as well.

It’s like for many folks who might have made it, like, they might be the first in their family to have done that and they just wanna create those opportunities for those behind them to be that helping hand, to bring them up. Whether, like you said, it’s in the field or whether that’s just in the community with mentorship or youth development, there’s, um, so many things someone can do and it’s, I guess it’ll just be self discovery, like, understanding, like, what, what is that for you? Like? What’s, what’s your purpose like?

Why, why are you here? Right. And try it out, try different things. They can try it. Right. They’re still in the business. They’re still working, they can try being a member of different committees, different boards, their church, different outreach groups, give it a whirl, see what they like and then they’ll find it eventually they’ll find something that, that really touches them, so love that. And, uh, I guess with that, um, any, any last takeaways you want to share with the audience, um, it could be just personal advice, it could be with exit planning.

Um, and maybe even some actionable takeaways that people can act on so that, you know, they leave this with something to do or something to move towards. Yeah, I would say if they’ve listened to this interview today and they hear anything that speaks to them and they like to discuss it further. You know, they should come and schedule time on my calendar. There’s no, and there’s no obligation. There’s no, it’s just two people having a phone call. Right. And seeing it for their sensibilities and their personalities work together and if it does fine, if it doesn’t, there’s other advisers that I could recommend them to where they might have a better fit.

But I would say don’t waste time and think that you’re, you should, you’re not ready yet. That would be the takeaway, right? That, that you should be looking at this now because the sooner you start, the sooner you’ll get to freedom. That’s it. Right. It’s not, it’s not like, oh, I’m not ready or we’re not the right size business or we, everybody has this. I hate to, I hate to make it sound like I’m not, people aren’t special because people are unique however, and they’re unique. They all have their own circumstances.

But really when we look at a lot of issues, they’re not special. Other people have overcome these same issues a business owner might have. So, don’t ever think that should stop you from picking up a letter from, like, going on a link and, and scheduling time on the calendar to have a phone call because there’s no harm in. Right. It’s just be open to the exploration of it. And then you’d be surprised that it, it might have a phone call for 15 minutes now and then a year from now you say, oh, well, I think it’s time to go back and talk to that person, right?

You know, I’m getting to the, uh, some of those things have happened and then they, then they, like, then there’s a buy in not, I mean, financially, but I mean, emotionally where somebody buys in and they really can expedite the process and experience this freedom that, you know, that, that freedom, that financial freedom, that, that’s the goal. So, yeah, it’s amazing. And, um, for everyone who is listening, we’ll make sure to include Jeremy’s link in the show notes. Um, so you can book that 15 minute call again.

No obligation. It’s really, um, you know, just an opportunity, like you said, Jeremy, just, just two people talking and really, I mean, yeah, just, just connecting. Really? Yeah. Yeah. Summerton. Yeah. And as they say, your, your network is your net worth. And you know, Jeremy, the, the things that you’ve done, the experiences that you’ve had. Um really, it’s, you have just a unique insight into the industry and you’ve combined it with the, the book Smarts and the experience around the financial planning parts of things and exit planning.

So it’s really a unique blend of a lot of things. Thanks a lot. Thanks for having me today. It was a really great experience. Yeah. So with that, I just wanna say thank you to everyone. Thank you Jeremy for your time and advice and also thank you to everyone for listening. Um We’ll again, make sure to have the, the link in the show notes and um hopefully, this was helpful and we are all cheering and rooting for you for your path to freedom. And so start today.

I mean, you know, the best, as they say, the the best time to plant a tree was 20 years ago, similar with your planting. You didn’t do 20 years ago. Let’s let’s start today. Try that. Take care everyone and uh we will catch you on the next episode. Take care everyone. Thank you for joining us for the H VAC Financial Freedom Podcast. Follow us on Stream Yard Apple podcast, Spotify, Amazon Music and check out our main website W W W dot H vac financial freedom dot com to find out how you can also achieve financial freedom.

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