Business Succession and Legacy with Chip & Jon Vaughan

In this episode, we join our EVP and chief mission officer, Russ Crosson, and our managing director of business consulting, Jeff Wernick, as they interview Chip and Jon Vaughan of Brand Vaughan Lumber Company. Chip and Jon are father and son business owners who have run a successful lumber business with a 75-year history. They discuss succession and what it means to own a family business, and how Ronald Blue Trust helped them plan for the sale of their company while preserving their family legacy. 

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The information in these podcasts is provided for general educational purposes only.  It is not intended as specific individual advice. The clients’ experience may not be representative of the experience of other clients and they are also not indicative of future performance or success. Opinions expressed may not be those of Ronald Blue Trust.

Trust and investment management accounts and services offered by Ronald Blue Trust, Inc. are not insured by the FDIC or any other federal government agency, are not deposits or other obligations of, nor guaranteed by any bank or bank affiliate, and are subject to investment risk, including possible loss of the principal amount invested.

Chapters

• 3:00 Brief History of the Business
• 7:48 Communicating Your Calling to Your Children
• 11:25 Next Generation Leadership
• 15:00 The Effect of 2020 and New Strategies
• 17:00 Sell or Not Sell?
• 27:00 Advice to Business Owners on Similar Path
• 33:30 Getting Comfortable with Selling
• 36:00 Telling the Kids about Selling the Business

Transcript

- [Announcer] Welcome to the Wisdom for Wealth For Life Podcast. Let's bridge the gap between your faith and your finances. At Ronald Blue Trust, we apply biblical wisdom and technical expertise to help you make wise financial decisions. Our goal is to help you leave a lasting legacy. In this podcast, you will hear inspiring stories, practical tips and encouragement from the Ronald Blue Trust family with special guests along the way. Welcome to the Wisdom for Wealth For Life Podcast. The information in these podcasts is provided for general educational purposes only. It is not intended as specific individual advice. The client's experience may not be representative of the experience of other clients and they are also not indicative of future performance or success. Opinions expressed may not be those of Ronald Blue Trust. In this episode, we join our EVP and Chief Mission Officer Russ Crosson and our Managing Director of Business Consulting Jeff Wernick as they interview Chip and Jon Vaughan of Brand Vaughan Lumber Company. Chip and Jon are father and son business owners that have run a successful lumber business with a 75-year history. They discuss succession and what it means to own a family business and how Ronald Blue Trust helped them plan for the sale of their company while preserving their family legacy. Let's listen in now.

- Hello, everyone, welcome to the Wisdom for Wealth For Life Podcast. I'm Russ Crosson and I'm here with Jeff Wernick of our Business Consulting Services division, Chip Vaughan and his son, Jon, with us to talk about their experience in dealing with a family business and the transition they've been through over the last year. So we're glad you can join us and we look forward to just unpacking some principles that hopefully you can use relative to your thoughts in your business. So Chip, Jon, thanks for joining us. We got Jeff Wernick, the head of our Business Consulting Services division here as well. But what we wanna do is we wanna share with other business owners some of your learnings and some of the wisdom you've gained over the years and especially this last year as you've come to an interesting inflection point with your business. So the purpose of this is to help people understand from your perspective a family business, how it started and then what's transpired over 75 years, right, Chip? 75, 76 years, so Chip, start off and just tell us a little bit, give us some family demographics, talk about the business, how it started and just give us a little color commentary around the business.

- Sure, it goes back to 1946 with the business after World War II. My dad came back from World War II and with his cousin by marriage, RL Brand, they started a building supply business in Southwest Atlanta. And the name of the company is Brand Vaughan Lumber Company. They began in an area of town when Atlanta after World War II was just the focus of all the building was in Southwest Atlanta. They started there, very small humble beginnings, but really stayed the process. Atlanta became a boom town through the years. And over the last 75 years, we've been able to sustain and stay in business and prosper at times and had some really rough times as the housing industry tends to do, work in cycles. So we started out, I was never gonna work in the lumber business as it turned out. I witnessed my dad going to work and I worked at the lumber yard as a kid and through high school. My interest was primarily basketball during that time. So it was hard to get a summer job anywhere and then say, hey, can I have two weeks off and go to basketball camp? So I was able to work at the lumber yard. And all I really knew about it at the time was how to load and unload trucks and sweep floors and wait on customers and do whatever it took at the time as a summer job. But my primary interest at the time, went to school at the University of Georgia and my mom had gone to the University of Georgia. And so after high school, I wanted to pursue a career in business of some sort that I thought at the time. Went to the University of Georgia, had the opportunity to play basketball over there, and then followed that up with a stint in law school. So I went and got a law degree over there and in 1976, I had a job with a law firm in Marietta. And Mr. Brand came to my dad first and then to me with an opportunity to buy his interest out. So in 1976, it's a long story on how I came to that decision, but God had another plan for me, rather than go into practicing law was to come in the family business. So I made that decision and I had no other siblings, I'm an only child. And so that made the decision easy for Mr. Brand because he saw no succession plan. His kids were in the medical field. And so I was the last resort, so to speak. So I was glad to be that last resort and came in and really learned the business from a management level there for a few years and then we grew from there.

- So I think it's important for those listening to this. Your story's probably very similar to many businesses, started after World War II, you're an only child so this is important that we talk about succession. So you had your dad and Mr. Brand and they brought you in 30 years later, but it got a little more interesting for you because you have four children. We can talk about those a little bit. And now, that's always an issue for people, and Jeff sees this a lot, is how do you do succession and how do you figure out how to keep the business in the family? So talk a little bit about you started, you went 30 years after the business started, in '76 you came in. And then talk about your children and then the process of Jon, gen three, who's been president of the company. Talk about how that happened 'cause that may help some of our listeners.

- Sure, so I have four children. I have the oldest one, my daughter and then Jon is the next one and then two other sons younger. So it was interesting to watch them through the course of their life and find their interest and passion. One of the things that my dad told me, even in that transition time when I came from law school and came out, he told me, he said, "You do what you're passionate about. "Whatever you wanna do, don't feel pressured "into the business, don't feel like you have to come "because this is here "and you wanna keep the family business going." So I always appreciated that. I wanted to transmit that same message to my children.

- Let's stop there just a minute 'cause Jeff, you've seen that how important... Let's just unpack that principle a little bit. How important it is for our kids to be able to do what God's called them to do.

- Yeah, I think that, Chip, you mentioned something about you gotta find where your passion lies. And where we see a lot of business owners struggle with is I'd love to have my son or my daughter come into the business and work alongside me. And if they're not called to do that, I deal with it a lot where they say, "You know what? "I didn't feel like I had any other choice. "I felt like this is what the plan was "and I walked into the plan and so here I am." And when we're introduced into the mix and there's another party that they can talk to that's not a family member and they can share that, hey, are there options? And so that's the struggle with family businesses.

- And so your dad should be commended because him giving you that freedom as a principle that business owners need to understand it's hard 'cause your name's on the company, I need to have my son or daughter come along to take on the business, but good advice your dad gave you. So now, sorry I interrupted you there, but now you're dealing with your four children.

- You observe their life and their passions and their interests and what they wanna do. So along the way, their interest was pretty diverse, but it stayed in the SEC a little bit. So we had Jon that was at... In one year, we had Jon was at University of Georgia, my daughter was at University of Alabama. As you can imagine, that was an issue the other night. And then the next son was at Auburn. And then the younger one was eight years younger, so he was at Fellowship Christian School then. But you observed what their interest and their passions were and it really became pretty obvious Jon was the guy that was interested in business. The others that we had creative bets that needed to be expressed in some kind of form or fashion. And so it was apparent early on that Jon might end up at the lumber yard. One of the rules that we had was they all had to work at the family business at some point in their summers or whatever. Jon has been a waiter and different things, but he had to come work at the lumber yard because they had to see the dynamic of the family business, how it operated, get to know what their dad did and what their grandfather had done, and really just to see how they responded in that environment. So they all went through that process and Jon's the only one that showed an interest in coming back to Brand Vaughan after his college career. And one of the rules, though, that we had and I'm sure it was in some of our discussions that you and I had along the way with other people that you had seen was the right formula with that is that would be great for him to come in, but if you wanna come work full-time at Brand Vaughan then you need to go somewhere else and earn your stripes, and get another job somewhere else outside of Brand Vaughan and get a promotion, get a little bit of a career started there before you could come back.

- That's great, that is a great principle. That is probably the number one principle that we taught to business owners is if you've got next-gen that's gonna come in, make sure that they go work somewhere else. And we have a lot of our business owners like, "We'd love to find Christian business companies "that they could go work for so they could see "that faith integration worked into the operation." And that's ideal, but regardless, go somewhere else, see how someone else manages a company, deals with employee situations. So then when you go back into the family business, you can take that outside wisdom into that family situation.

- So I think it's important here and Ronald Blue Trust has always been a principal-driven company and you've implemented two principles there. First one was, hey, kids need to work in the business during the summers and see what it's about, so they can see if they have any interest. But then as they begin to express their interests and their passion, which is what we would highly encourage, it became obvious that Jon was the one that had the interest and the others didn't. So how did you guys intentionally communicate that to the family? I remember we had some family meetings because you've observed all this. So talk about that a little bit. I mean, Jon, you came to some of those meetings. And so talk about the importance of intentional communication to the whole family so there's no expectation in reality and coping gap issues.

- I use that to this day in business that the difference in reality and expectations, the coping gap, the smaller that that is, there's less disappointment. And so something that we learned at family business or family meetings early in life. And it was invaluable for us to be able to be aligned as a family from very early on, to be able to have all three generations together. So our first family meeting was with my grandparents, my parents and then the three children. Andrew, Drew was too young at the time to join us. But to be able to understand, we'd always been taught the principles, but see the bigger picture and the why around it was pretty impactful for us as kids. To be able to understand what my grandparents had went through to get to where they were at that point, to see what my parents were going through and where the estate looked like at that point, and then also be able to talk early before we were in our professional careers about what a succession plan looked like and what does success look like for us. They had those conversations with us that we want you to follow your passion, not be part of the family business just because it's expected. But to be able to have that reinforced in meetings like this was great. And it also helped as I went along in my career and I was part of the family business that there was buy-in from my brothers and sisters.

- There wasn't that sibling conflict. There wasn't ever any issues 'cause it'd been talked about and your siblings expected, hey, know Jon's gonna run the company. So that's the importance of communication.

- And they were cheerleaders. There's never been any friction around Jon's getting preferential treatment or anything like that and that they wanted me to not succeed. They've been some of my biggest cheerleaders, biggest supporters through the whole process, even through the transaction last year.

- So the principle here is clear communication. Chip's dad started it by saying, "Hey, Chip, do your passion." Chip passed that on, said to his four kids, "Do what you're passionate about." Jon has passion for the business. So now we're moving along, 30 years Chip comes in, 30 years later, Jon comes in to the company 2006. And I think the thinking would be Chip was in one office, his dad was down the corner and then Chip moved down to the corner and Jon moved in. So I think the thinking you guys had was this'll probably just continue on. But let's fast forward then to just what transpired a little over a year ago because I think you guys had had it all set up and things were working great, but talk to us about what happened about a year ago now.

- So we had been through the downturn of '07, '08, '09. And we had seen as we've talked about before, it's the principles that we've been built in that my grandfather and Mr. Brand had, that my dad had around how do you manage debt, don't leverage the present for the future that we made it through '07, '08, '09 from 120 lumber yard locations in Atlanta down to 18 and we were one of them. So we'd been through that, we'd felt the pain, we'd seen what that felt like to come out of it. And we were very because we'd made it through, we had incredible opportunity and took advantage of that. Well, 2020 hits and COVID hits and we start to feel these same sort of feelings that we'd felt in 2008, 2009. We're doing cash burn rates, we're doing how long can we make it if our builders stop paying us. And it just gets you that place where it's like, oh my goodness, this is gonna be both significant stress and significant opportunity on the other side of this. And because throughout the years I've built a network through speaking at different industry conferences and being part of round tables and things like that, we'd stayed connected with some folks that were interested in partnering with us. So we looked at what the future looked like, making it through COVID and these businesses staying engaged with us and we said, okay, well, what does the future look like and what is it gonna take to get there? We'd grown so much, we were more than double our size from pre-downturn after 2006. And so we were starting to have to think about what does financing models look like, how can we grow, is it gonna be with debt, is that part of the principles that we want to adhere to within our business and how do we build a strategy that's sustainable for our family and for our people?

- So I think the principle here is you guys are caretakers and stewards of the business. So you're going along and you have your plan. It's been a family business for 75 years and you think it's probably gonna stay that way, but you're looking at the industry, you're seeing these different changes. So all of the sudden, you have to entertain are there some other options here that as we steward this business, 'cause we're stewards of it, God's given it to us, that might look different than what we thought rather than Chip moving down the corner and you moving in and then your son coming along or whatever. So you called me and said, hey, we have these potential options. So let's talk a little bit about because, and Jeff, you may wanna interject here, the whole decision-making, how do you decide? 75-year business, isn't it gonna be 150-year business? How do you even get into that process of making a decision that might lead to an external sale? How does that...

- So the one thing I know when we met, we talked about careful of the binary trap of do we sell or do we not sell? And I think what y'all did, which I really was impressed with, was the thought process that you went through as it relates to, okay, what is BVL 2.0 look like? So we can stay independent, we know we're gonna have potentially a major capital need 'cause we've hit this inflection point, we're looking at a management team, there may be some holes that we've gotta fill, we may not have all the people on the bus that we need. And so you had that conversation going. You had a conversation with the financial buyer who we knew well, we'd been on another transaction with, good folks, industry leaders in that space, and then you had strategic folks that were interested. And so talk us through a little bit about how'd you process on your independence versus partnering with a financial partner, which obviously there's risk involved there and then ultimately to looking at the strategic option. What did that dynamic look like as you wrestled through it?

- Well, you lay it out very well. We modeled it out and it goes to the stewardship model is what is a good stewardship decision? And we sat in here and we talked about it would be so much better if we opened up the Bible and we looked and it said, hey, here's the verse that says it right here.

- Yeah, it says to sell or don't sell or whatever.

- Exactly, that would have been ideal. But we were prayerful as we went through it. We were eyes wide open around what do these things look like. And beforehand, we understood that whether we were gonna stay independent and create a need for us to go acquire, to acquire some of the competencies that we needed in a changing market or if we were going to be acquired, I wanted to be educated about that. So went to Kennesaw State, got an M&A certificate, which Jeff doesn't have. I won't put too fine of a point on that. So I started to educate myself. And so I wanted to understand what does this look like as we go through the process. And so as we looked at these three, we thought about, again, it's that stewardship mindset of what does future look like in all of these three states and not just to be binary and sell or not sell, but also not be shortsighted around saying if we don't sell, this is what the next five years looks like. If we do with a strategic buyer, what does it look like and with a financial buyer, what does it look like? And making sure that it wasn't a selfish decision, that it wasn't this is for me or me and my family, but considering what does it mean for my dad and my mom, through that process, what does it mean for my siblings and what does it mean for our people because we're such a people-driven... We wanna build something that's sustainable from a cultural standpoint for our team and have them part of that process, too.

- I think this is an absolutely critical point 'cause we share with all of our advisors to share with their business owner clients, unless you know what you're gonna do and what it looks like and ask some of these questions, you don't sell. The decision is never do I sell or not. The decision is what's the next best step as I steward this entity. And I think that's important for people to understand because you get an offer, people show up at your door and that's when you called me and said, "Hey, we got some offers." But that wasn't a decision. I remember Chip you called me, you came over to the house, we started talking about decision-making. But talk a little bit about I think one of the most critical things for the two of you was, what's it gonna look like for each of you? I know, Chip, you were very concerned as you were looking at all this, what's this mean for Jon? And you saw some tremendous leadership opportunities for him, therefore the potential sale became more attractive. So talk about that a little bit, how you guys were both answering the question, what's it look like for me on any of these potential scenarios?

- Right, well, from my standpoint, obviously, I'm in a point in my career that at the beginning of this year that I've been around since 1976 in the business. And as much as I wanna continue to contribute in the business, my career is basically over. So I know it's in the hands of Jon and it's really his decision, his business decision, but the concern that I had is that you have a concern as an owner and as a dad in the process. And so you want the very best in both worlds to happen to be able to get the best deal if there's a transaction, but also to understand that there's a price to pay on the other side maybe and just to make sure we're aware and acknowledge the potential for stress or time away from the family and all that. So we try to look at all the avenues and what's really a best decision. And personally for me, it became a tough thing to go through from an emotional standpoint as you think about your people and you've been committed to them all these years and they came to work for a family business and you wanna continue to provide an environment. So part of the decision-making matrix that you and I went through that day at your house, that talks about your people and how important that is. So we gave a high number to that to make sure. So as we entertained the offers and the options, we made sure that we felt good about how they would treat our people in the aftermath. And so that's part of it. It was hard emotionally to get through the process for me, having been there and that's all I'd ever done. But it was rewarding at the same time. And the way our structure is that we continue to maintain the name Brand Vaughan Lumber Company, we continue the leadership team in place. We had our people still see us and feel us around the company. And so it's been a good deal. But it was a hard emotional decision for me, for sure.

- Jon, real quick, you and I talked about the network of people that you had around you that you pressed into. And we encourage our business owners to have either some sort of informal network of folks or more formal and an advisory board or even as formal as a fiduciary board, but people that are outside the business 'cause family businesses can be a vacuum. And so talk a little bit about who did you have around you that you were pressing into that was giving you just outside perspective?

- So I built a personal board of directors is what I call it over time, people that I trust, that understand me, my heart and how I wanna lead and how I wanna lead both my family and lead the business, and also that have the ability to speak accountability into my life about saying, hey, you're thinking about this the wrong way or are you taking this into consideration? So I have a friend who owns, who I've been friends with for a very long who owns a family business as well, that we could bounce numbers off of and accountability to the point if he can look at all of my financials and I his and so that we can have these open conversation. I had somebody who was in the industry that owns a business as well that understands the dynamic of our market and the people that we were talking to, that we had a very confidential relationship where we could share things and he could speak into us. And then another friend who is just in it from a corporate side who understands some of those things as well that sees the different businesses that again, full confidence, full confidentiality that we can be able to share. So we could sit together with individual conversations or group conversations and just say, hey, this is what we're seeing, this is what I'm seeing and I'm hearing. What am I not thinking about? Where am I looking at this the wrong way? And that was invaluable to be able to say, okay, Jon, you're really putting too much weight on the sale price or the equity retention or what is this next position look like. You need to be thinking more about this in these different ways. And so being able to have that as well as our CFO in our business who was just invaluable to be a partner to be able to model it out and him understanding that the decision that we made may not be best for him, but if it was best for the business and best for us, that he would supportive of that. And that was just really, really great.

- So you guys are going along, you get these offers. So all the sudden now the decision-making is do we do Brand Vaughan 2.0 or do we take one of these offers and you were processing it. You were both sensitive to what the future looked like for each of you. Chip was concerned about Jon and your new role, but also the excitement of some new leadership opportunities if you did sell. You were also concerned for your dad about, hey, if we do actually sell to a third party, what are you gonna do and how's that look like? I think all that was very important as you guys processed that. So you'd mentioned earlier that you got some training at Kennesaw on some merger and acquisition stuff. And so once it becomes obvious as you go through the decision-making process that you maybe should entertain an outside sale and you've processed with the family, even though it's been 75 years. You'd passed the baton to Jon, but we talk in a minute about the fact that what your children said to you as this came about. And I suggested that maybe you ought to get some, even though you'd gone to Kennesaw and got this M&A thing, you might wanna get some outside help. So talk a little bit about was that a good decision and I know Jeff was the guy that guided you through that. And even though he's a Georgia guy and that gave him a lot of credit on the front end, talk a little bit about as you would share with these other business owners just what you experienced and what you would recommend to them when they get to this inflection point.

- Without a doubt. There's a comfort level that you feel because you know the industry, you've been educated on it, you know the people that you're dealing with, you feel like you've got trust in them that you have these conversations, hey, we want this to be a fair deal for both sides. But you're like, okay, I can navigate through this well without additional consultative service, advisor, banker, whatever the case may be. And as we had gone through our decision-making matrix together, we got to the point where we said, okay, yeah, we wanna go further with understanding these offers more. And when we met with Jeff, it became evident within 30 minutes that we are way over our skis trying to do this by ourselves. His experience, his tact, his understanding of the business with having a transaction in our space already immediately gave him credibility with us. And then his approach with the folks that we had been relatively far down the line with, introducing somebody new, the way that he entered into that was just fantastic. And so absolutely, I would encourage any business owner going through this process to engage with an advisor in a way that is meaningful. It increased our purchase price in a meaningful way. It helped us build out our working capital structure, our working capital peg better than we would have otherwise. He brought a team around us with accounting and attorneys that made the due diligence process great, the contract process great. And then on the backside after the close on some of the different markers on earnouts and working capital pegs and holdbacks that it's taken a lot of stress off of us, it more than paid for itself and it also gave us a better outcome in a way that some of the tough conversations that had to be had in the process, I didn't have to have them because I had to work with them on the backside. So if I would have had to have some of these tough conversations, it could create some friction on the backside, but Jeff did a great job of having those tough conversations and finding quality outcomes that were win-win, but just absolutely was a fantastic decision.

- Well, I appreciate that. I think that it's funny that we have this conversation a lot with business owners as it relates to creating an emotional buffer in the transaction.

- That's sure a good word, emotional buffer.

- You're absolutely, you can get to where you really wanna see a deal get done and so sometimes you're willing to concede on certain points that if you had somebody else that was in the middle negotiating for you, you're removed from that. And so one question that I wanted to ask you was you were in an environment where it seemed like every month EBITDA was going up. And I remember having a conversation with the both of you through the process. Do we need to go back and try to recut the deal? Because I think that when business owners think about maximizing value and where does that fall in the priority list, y'all had made your mind up that you didn't wanna do a fully marketed transaction. You didn't wanna hire an investment banker, take it out to the street and do that whole thing. You had the financial offer. So you had a data point in relation to the strategic offer. So we at least we had a couple things that we could look at. But just talk a little bit about just your processing of why you felt like, hey, this is a fair deal for us. Even though we've got this incredible run of financial performance, it's gotta stop at some point. And I remember having the conversation with you and you're like, look, we never thought we were gonna be here at this stage. So to try to squeeze every little bit out of it, we gotta work with these guys at the end of the day. Talk a little bit about just what your psyche was at that point in the deal.

- Yeah, it's tough and because at the time, the lumber market was going crazy and so pricing was accelerating at a high pace and we were having our best sales months. And because expenses were not running at the same pace of growth as pricing, we were having our best EBITDA months in our history. And it would've been really easy to fall into that trap of being able to say, okay, we need to go back and try to talk about what the numbers are in this. And we had touched on it a little bit and put our toe in the water with him and when we realized that what this is gonna do from a relational side with the buyer was gonna be tough, but also for our team. Because if we did and we could have renegotiated to the point where our EBITDA was at that point of a trailing 12, that what we knew for sure was that the microscope on our team was gonna be such that it was gonna put a lot of pressure on our team. And when we looked back at the matrix and saying, hey, what's the most important things to us, it wasn't maximizing cash for the Vaughan family, it wasn't maximizing or minimizing our time to stay with the business. It was how do we find continuity, how do we find a quality return for what we were getting and it was also how do we build an environment where people continue to be taken care of? And we knew that if we went to the trailing 12 months EBITDA closer to close, it meant that there was gonna be a huge microscope on our people and that wasn't fair to them at the cost of us getting an additional dollar. So that's that stewardship mindset, saying we don't own this. We're stewards of this and the right stewardship decision for us at this point is to be able to say we've got a very fair deal. Different in more than anything we could've ever imagined. We're going to be fine. So let's take care of our people through this.

- Yeah, it was. You never go wrong and regret taking care of your people. So Chip, I wanna come back to you. You took over for your dad and the patriarch of this whole thing, handed it to Jon. So what would you say to the people listening your thought process and how you got comfortable with actually okay we'll go ahead and sell? How'd you get comfortable with what you were gonna do, what Jon was gonna do? Talk about that a little bit 'cause I think there's probably a lot of people listening to this that are in your shoes. They've built the business from the '60s and '70s up to this point. Their family may or may not be in the business. So talk a little bit about what you would say to encourage them if they do get to this point how you've gotten comfortable, with the next, with what's next.

- Right, well, like I said earlier, you feel like, even though I wasn't the original founder, I feel like I gave birth in a lot of ways to the company. So you feel like are they gonna be orphaned? And I was feeling like, what am I gonna lose, sometimes along the way. So you have to do a lot of introspection and see where your self-esteem and self-worth is and understand that you've been doing this all along. What have you been doing it for? Have you been doing this to sell the business or have you been a steward and just taking the opportunities that have come along in life? And just God's got a different plan, a different future. So it was a prayer, it was the matrix that you and I went through and it was discussion with my wife and my friends as well, my counselors like Jon had and just talk to them and it became evident and clear that as much as there might have been some reluctance in there that this was the right thing to do at the right time. We felt like it was a once- in-a-generation kind of moment here.

- I think the keyword for people listening is go through the process. The best process will help you have the best results and you guys did that from the decision-making as Jeff said, not being in the binary trap, to then the process of having outside counselors and then engaging Jeff and his group to actually work on the deal. The right process seems to always end up with the best result, and you guys did that. And I think it's very interesting, Chip, you could've thought hey, it'll go to my grandson and he'll run the business, but I think it's interesting. We were at a dinner and remember, Jeff, when Jon was sharing what he learned?

- Tell the story about when your, was it your son that was jumping on the bed or something? We were on a call.

- We just dropped off... This is the week or two weeks before closing and we had not shared everything with our siblings yet, my siblings yet. And so we were gonna have a call, it was Father's Day. We just dropped off my daughter at camp and so she wasn't with us at the time, but we were like, okay, we wanna share with our boys before we're on this call with my siblings.

- [Russ] So tell me, you have a daughter and two sons.

- So yeah, I have a daughter. I have boy, girl, boy, 12, 9, and 6. And so we were like, okay, we need to tell them what's going on before we get on this family call. So we sit him on the bed and I tell him, hey, this is what we're doing. We're selling the business, we're joining this business called US LBM, we close on July 1st. This is what it means for our family, that this will be opportunity to take some debt off of the shoulders and some stress and an opportunity for growth for our people and et cetera, et cetera. And so my five-year-old's just bouncing on the bed. My 12-year-old gets a little teary-eyed. And so he walks to the other side of the bed, Molly, my wife, wonderful wife, grabs him and says, "What's wrong, buddy?" He said, "Well, I just thought "it was always gonna be a family business." And so I'm like, oh man. So the things that are going through your head are generational, granddaddy, my dad, me. And my five-year-old at the time's bouncing on the bed, he stops. He looks me dead in the eye and he says, "Your ancestors would be so proud of you." And that's the Holy Spirit is all that that is. There's no reason a five-year-old would have stopped that and said that. So I just lose it. I go into the bathroom, I collect myself. I come back out and Molly says to my 12-year-old, 11 at the time, he says, "Tell your father what you just told me." And I'd been the same principle that my dad had with me was I've been telling my kids I want you to do what you're passionate about 'cause where passion and competency lie, that's where your purpose is. And so he says, "Dad, I know you've always told me "that I didn't have to be part of the business, "but I knew that my sister and brother couldn't do it "and so that it was gonna fall on me. "And I felt a lot of stress around that "'cause that's not what I wanna do. "And this just gives me so much relief." So at 11, to be able to communicate that to that and just know that we've been prayerful through it, we went through the process, and that it just is confirmation. We just felt confirmed and affirmed through the Holy Spirit, through our kids, through prayer, through conversations the whole time and that was the finest point on there this, your ancestors are so proud of you and I felt the stress and now that's gone.

- So now the 12-year-old doesn't have stress because you guys applied the stewardship principle. You realized you were stewards of Brand Vaughan Lumber for 75 years and didn't think you'd be doing an external sale, but you went through the right process, you've sold, closed last June 30th and you get confirmation from your 12-year-old, amen, this is great. I knew my siblings weren't gonna do it, so I was gonna have to do it and I didn't wanna do that.

- Right.

- So Jeff, anything you wanna share as we wrap up here or any other questions we need to unpack?

- No, I think I just wanna thank y'all. It was a pleasure to work with y'all on this transaction and I appreciate obviously Russ getting me involved and my team involved, but just wish y'all the best and know that you're with a good group and I know there's a lot of great opportunities for you going forward. So I just thank you for the opportunity to serve you.

- Well, I just wanna thank you guys for sharing and hopefully, the listeners, here's a 75-year family business that's just followed the process, we did the right decision-making. I think the takeaways are go through the right decision-making process, ask the right question, it's not do I sell or not, it's how do I steward it? And then once you begin to decide you might wanna sell the family business, get some outside help to take the emotion... What was that word you used, emotional?

- Emotional buffer.

- An emotional buffer, so thanks for allowing us to come alongside you and it's so cool about your sons. That's pretty neat.

- Well, it wouldn't have happened the way that it happened and we wouldn't feel the comfort and just affirmation without what y'all helped steward us through. So thanks to Russ for bringing Jeff in and Jeff, for just the unbelievable partner and confidante and team member we had through the process.

- Chip, any closing comments?

- No, I'd just have to echo that that it's just been an incredible relationship we've had. I just appreciate you guys being by our side the whole way through and giving us counsel and wisdom and affirmation. And it's been great and we got more to go. So we're not finished with you yet. I hope you're not finished with us.

- No, we're not finished with you guys. And as we wrap here, I'm just glad that all these guys got their red face paint off for the National Championship on Monday night. So thank y'all very much.

- Go Dawgs!

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