Business Development and M&A with Dynamic Entrepreneur, Chris Pflueger

Forever upholding the Sigma Chi Jordan Standard, Chris Pflueger graduated the University of Florida (Gamma Theta chapter) with a degree in Economics, then earned an MBA at USF in Finance and Management Information Systems.

With over 25 years of experience in sales leadership, sales management, and executive planning in franchising and related industries. Chris Pflueger is a Certified Franchise Executive and a proven leader: 

• Established a national expansion plan for We Insure and grew the franchise footprint into 33 states in 2 years with over 200 units.

• Produced 200% of goal within 1-year, exceeding industry growth rate and establishing RE/MAX as the global leader.

• Promoted 7 times in 9 years, advancing from Sr. Business Development Consultant to Vice President of 2 organizations within the RE/MAX umbrella.

• Created and rolled out a whole new brand, developing a marketing and sales plan and leading a successful market launch (over 100 units sold in the first two years).

• Exceeded franchise sales goals for 5 straight years (over 975 franchise units sold)

• Designed & rolled out a new web-based delivery platform in under $9M.

Selling a business is the American dream, the pot of gold at the end of the rainbow, the reward for years of hard work. Successful entrepreneurs make countless sacrifices in hopes that they would someday reap the benefits of their labor and live a new life of vacations, recreation, and prosperity.

You only exit your business once, so you should feel confident passing this milestone. A successful business exit reflects the preparation done beforehand. Failing to plan is planning to fail.

The owner of a privately held company has several alternatives on how to exit their business. In the absence of an exit strategy, events will inexorably dictate the final exit plan. A costly involuntary exit may be caused by death, disability, divorce, disagreement, or distress.

Selling Your Business with David King will help you take control of the sale process and make it positive one.

Transcript

Speaker 1 (00:00):

<silence>

David King (00:11):

Welcome back to Selling Your Business with David King. I'm David King. I am the author of Selling Your Business. Begin with the End in Mind. It's available on Amazon. And today I have the great pleasure of chatting with my true friend, Chris Fluger, a friend and fraternity brother from college. Chris, welcome this morning.

Chris Pflueger (00:41):

Thank you very much, Dave. I appreciate you having me on.

David King (00:45):

And Chris, I, I, I gave, uh, the, the, the thumbnail for my, this, uh, YouTube video to Jimmy Springer, and he posted it on the Sigma type page on Facebook and said that we were pledge brothers. Uh, Jimmy Springer got that one wrong. <laugh>. So, as you might remember, I was a fall 88 and you were a, a spring 89.

Chris Pflueger (01:13):

That's correct. That was correct.

David King (01:14):

Yeah. And my, my brother was actually your assistant, McGeester.

Chris Pflueger (01:18):

That's correct,

David King (01:20):

Yes. And in fraternities, the guys who had just been initiated tended to be maybe a little bit more active in making sure you were good pledges, right?

Chris Pflueger (01:32):

That is, that is correct. There is a checks and balances system.

David King (01:37):

Yes, exactly. So I mean, you, you would probably say around the house, early on, I was a good guy, or as they said in coming to America, good and terrible.

Chris Pflueger (01:50):

You are a fantastic guy, right? It's, oh,

David King (01:52):

That's so, you, you're too generous there.

Chris Pflueger (01:54):

That's true.

David King (01:55):

That's true. So, in honor of that, if you can see closely here, I'm actually wearing my badge.

Chris Pflueger (02:02):

I see that.

David King (02:03):

And you're wearing a collared shirt with, without your pledge pen. I guess that's because you've been initiated. So I won't, I won't Morning remind you. Probation

Chris Pflueger (02:13):

Is over at this point. So he does.

David King (02:15):

Yes. So, Chris, I, I will say his career reminds me of another client that, that I represented. Chris is not a client of a client I represented named, uh, Terrell Owens. He played in college and was kind of on the down low. Nobody knew to, when he was coming outta school, he, he was number 81 for the 49 ERs. Then one night caught a pass over the middle against the packers. Nobody thought he would be able to hang on the ball. And that was it. From then on, he was the man and he just blew it up. He was the go-to guy. Everywhere he went. And everywhere he showed up, he same motto, get your popcorn ready going around. Chris, you even keep a sharpie pin in your sock, don't you? Just in case anybody wants an autograph, just in case I have to move around,

Chris Pflueger (03:16):

I have to move around to keep the paparazzi off. It's crazy. So I wish that were, so

David King (03:20):

Anyway, I'm very happy for you for how successful you've been since college. Um, and, uh, I I, I'll let you take it from there. Tell us again. We both went to the University of Florida after that,

Chris Pflueger (03:38):

Well, everyone considers that the Harvard of the South. So I mean, that's, it was obvious that we're on, on track to be successful after, after uf. But, um, I had a multitude of different jobs trying to settle into what I was looking to do. And, uh, I guess where I really took off was when I started working, uh, in real estate. So I started to work for one company in real estate as an agent with a team, and then I moved over, 'cause I lived in Colorado, which I do half the time now. Um, and then I worked for re max, uh, and when I worked for REM Max, I really kind of got an idea of what it was like to work kind of in the, the limelight, the big leagues, um, within real estate with the team. And fortunately, uh, they had just completed the building for re max headquarters.

(04:22):

And I was literally in, in sightline to that building. Went to a few meetings, uh, a few training events over there. Met the founder, met the C e O, and then started working at headquarters, uh, in a multitude of different, uh, you know, responsibilities. And so, while real estate is what it's called, re max headquarters is a franchise org, right? So, uh, they don't do real estate. Uh, I was one of three people in the building who had a real estate license or any experience in real estate. Everything they do is franchise, right? So it helps grow agents through the franchising model. It's in 110 countries and territories around the world. And so re max the main headquarters is, um, where I planted my flag for almost 12 years. So it's, it was a good experience.

David King (05:07):

And there I can chime in that selling a franchise I know for a fact is not an easy thing to do. True. You kinda have to mu what you get people to do hot yoga and meditation and get 'em to actually trust you for a moment. And, you know, I've got a friend who, who does, uh, franchises, sells franchises. His name is Franchise Frank. He, we, we call him Frankie Forefingers <laugh>, but it, it, he tells me every day how hard it is to get people all the different loops, you know, that they feel like they're loping roping you into,

Chris Pflueger (05:46):

Yeah, there's a lot of, uh, federal reg regulations and then also state regulations depending on what state you're in. So there's a lot of hoops that you have to go through and follow from a sales perspective. And, um, depending on, you know, which brands you're with, there's certain things you can say based on what's, there's different items in your franchise disclosure document, right? And if you have an item 19, you can discuss numbers. If you don't, which probably 50 50 these days, whether a franchise will have an item 19, you can't, if it's not in there, you can't discuss it. So on the, the bad part about this is, I'm talking to you about all the expenses, but I can't tell you anything about revenue. So try to sell somebody stuff on that. It is just like, lemme tell you how much it's gonna cost you over a long period of time, and you're gonna be committed to us between five and 10 years.

(06:33):

We're the best. Well, how much are you gonna make? Can't talk about it, can't tell you anything about it. There's nothing I can do about that. So, yeah. Um, I can refer to other folks as validators. I can have you talk to other owners. And even there, I can't steer you to just the good ones. Right? You know, so if, if I had eight franchises and only one of 'em made money, uh, the inclination was obviously, have you talked to the one guy? Right? Yeah. But I can't do that. I have to have you talk to all of them at your own request. So just to be fair,

David King (07:04):

And you know, the, begin with the end in mind, part of my motto here, when people buy and start a business and it's a franchise, and they, they ask, you know, well, okay, when I wanna exit and try to sell this thing, is this gonna be harder to sell than if I just had my own business? Does that a discussion that, that you've ever had to have with people

Chris Pflueger (07:33):

Comes up all the time? Um, matter of fact, you know, that I, that motto is exactly my motto, uh, when it comes to running any business, is you have to begin with the end in mind, right? So to me, whenever I look at a business opportunity, I always think to myself on an annual basis, what if I were to sell it at the end of the year? Am I operating efficiently? Am I, am I, do I have enough of, of the right mix of expenses? Uh, am I doing the right marketing? Am I overspending on certain employees or certain avenues where I haven't really checked it in a while, uh, to see if I'm getting a result? And so for me, I'm always doing the efficiency thing, right? I'm always going back and continuously looking to see, is this worth what I think it's worth?

(08:11):

And is it worth more at the end of the year than it was at the beginning of the year? And if not, why? Right? Is it the inputs? Is it the market? Is it me? Is it, you know, employees? Is it, is it product? It depends on what you're selling. Um, but every single time in franchising, and I'll just throw in there, between myself and my teams, we've had over 1200 franchise sales between multiple brands. Um, it, it is a process and franchising is, is, you know, paint within the lines, right? So when they tell you we're giving you a track to run on, we're giving you all of the, you know, the support, the discounted purchases, everything like that. If you're buying hamburgers, you have discounted purchases, you're getting straws at a lower price. If it's in real estate, you're getting all of the technology and some of the signs and everything else, and the discounted price.

(08:54):

It just depends which franchise you're with. Um, at the end of the day, the point of it is to be able to a, start quicker, have a support team, and then be able to have a saleable asset. Mm-hmm. <affirmative>, if you interview folks, which you should do every sin, every time you buy something, when it's a business, especially in a franchise, if you don't interview existing other owners, that's your fault. Right? That, that I, I encourage people, matter of fact, and, and the way I describe it is when I tell you about it, I'm the salesperson. So you would expect me to be very positive. And this is the best thing that's ever happened to you. Right? So you should never believe anything I say. You should automatically take that and say, great, let me go talk to three or four other people, some that I gave you and some you found on your own, and then come back and form your own opinion.

(09:40):

Because at the end of the day, there wouldn't be 3,800 units of one franchise in the United States if it wasn't successful. And the, we described that. 'cause people will come back and say, well, Chris, you know, in my area, in, uh, in Greenwood Village, Colorado, one of the offices failed. Exactly. The only reason we're having this conversation is because one of the offices failed. Right? We, we wouldn't have a spot for you. Right? So that makes sense. But we always use the, you know, kind of the Ferrari story, right? You don't look at a Ferrari as you drive down the road. It was wrapped around a tree and say, boy, I'm not buying a Ferrari, because that those things hit trees, right? It's, it's the driver, right? So sometimes you get a bad driver, what can you do, right? So that's why, you know, you do have to be prepared to work, uh, when you want, you start a franchise, it is an investment always. And, you know, there's always a group of owners that work in a mastermind type of a situation. You gravitate toward the best owners and find out what made it work. Like I, I've looked at personally investing in franchises, and, and every time I did it, I interviewed the top offices, and then I'd find a few that weren't. And as soon as you interview that owner that did not make it, you'll know why. Immediately. Why.

David King (10:51):

Yeah. And with being the, the pain in the rear of transactions, the attorney who's gonna have to take everybody through the nitty gritty details that nobody wants to have to deal with. Um, and I've worked on transactions large and small, and the small ones can be harder than the big ones, frankly. Uh, and when it's a smaller business, and it's also a franchise, that's another issue that the, the owner just really needs to be prepared about. They need to sit down with their attorney and make sure, you know, we've forgotten everything we ever learned at college, and they've probably forgotten everything in their franchise agreement. But then you would need to go back and relearn it again because that, that, you know, buyer is certainly gonna scrub it. And they're probably gonna have an attorney who does never looked at franchise agreements before and say, all of this is terrible. And it's, they, they just really need to bone up and be prepared on that issue of the franchise, because this is another, you know, another hill to climb

Chris Pflueger (12:00):

That franchise agreement. I hear it every time. Uh, you know, when, when we, we go through the, uh, initial discovery, you know, process, and we go through the stages of acquisition, you know, when you're buying the initial franchise mm-hmm. <affirmative>, um, I have probably 30% of the folks that purchased will come back and they're more analytical and they'll say, listen, I'm gonna run this past my attorney. Absolutely. I encourage you to, has your attorney worked with franchises before? That's the, that your point is very valid. Because if not, he's gonna tell you, this is a very one-sided contract and you should redline the entire thing. He's gonna charge you a fortune to redline it, and we're gonna say thank you, but we don't, you know, it's, it's kinda like when you go to buy rent, when you go rent a car, if you start reading through it, you start redlining it, you're not renting that car.

(12:45):

Right. Or when you buy a house and you go to the mortgage contract, very one sided. If you don't pay, they take everything away, right? Yeah. So, uh, same thing here. 90% of this is everything that's happened to that franchisor over the last 10, 15, 40 years. And they've had to make another addition to that, saying, well, in this case, if you did this and that, we have to do X. Right? So, um, if you're, if you're a good operator, you follow along, you do everything you're supposed to do, 90% of that contract doesn't really pertain to you. But when you're selling it, people are always gonna be a little spooked because it's a multi-hundred page document, right? So when people review it, they're like, this is very one sided. It is, it's, it's for our protection of the brand and yours as well as the new owner, right? So it's,

David King (13:30):

Let's move along to the first exit that you had in your career. What was the first business you sold?

Chris Pflueger (13:37):

So, uh, we've done a couple, um, and a lot of times I'm on the, uh, on the franchise side with between two owners. So that's probably the first ones I would recommend is, is those conversations. And, um, you know, as, as folks want to exit the business, they always have an inflated amount in their head, right? So the first thing I always do is tell people a, know your numbers and, and clean up all your balance sheet. Make sure everything is correct before you decide to sell. 'cause the last thing you wanna do is go in sloppy, because the other side will take advantage of that immediately. 'cause you don't know what you're doing, right? That's clear, right? Um, the other thing is, you know, you, you wanna be very diligent about buyers, you know, as they go through to make sure they're, you know, wanna waste a lot of time.

(14:22):

You don't go into a, a letter of intent, get all the way down the road and realize they may not be as well funded as they thought they were. So you have to do your due diligence on both the buyer as the owner and on the buyer on the other side. So you have to be on both sides, be careful. And then finally, as you're exiting, especially in a franchise agreement, there's certain stipulations they're already built into your franchise agreement for exit. Yeah. And if you're not aware of those, you should bone up. Because I could tell you, I've had, uh, owners under 15 year contracts that actually renewed in their mind every five years. It wasn't renewal, it was a bump up in fees every fifth year. And so they're like, well, after the first five years, I'm just gonna get out. Uh, not according to that contract you just signed, it looks like you're gonna be paying a little bit more and staying in, right? They're like, oh, no, no, no. I read it, you know, five years ago. It's that, okay, but you may wanna bone up. You may wanna bone up.

David King (15:16):

Yeah. On those franchise transfer fees, I, I know every single term is negotiable, but by and large, how, how many, how many are paid by the seller of the franchise and how many are paid by the buyer of the, of the business?

Chris Pflueger (15:32):

So if, if the seller is, it depends on how strong the brand is and where you stand in that chain, right? So if you have a highly desirable location, highly desirable brand, you're gonna pass those fees on the buyer, right? Guaranteed you're gonna build that into the <inaudible>. The the other way around is, Hey, I'm looking to retire. It's a decent brand. You know, it could be a coin flip, right? You could end up paying those fees, and if you're very savvy, you're gonna go back to the franchisor and say, you know, I'm trying to keep this intact. They may have to approve the buyer, and you may be able to get to waive the fees. It never hurts to ask, right? So I've, I've had people ask, you know, always shocked me that, you know, we approved it. Like, we'll say, sure, we'll waive it. It's not an everyday occurrence, but it might be a key strategic location for us. We don't wanna lose it, and we have the right buyer. Sure, we'll waive the fee, right, because it's millions of dollars to us long term. So why would we give it away? So, um, it, every situation's slightly different, but I would always ask in those, in those scenarios,

David King (16:32):

Tell me about your current interesting business model today, because this is, this is unique. It took, took me a little while to wrap my head around it.

Chris Pflueger (16:42):

Well, I'll, I'll jump into that in one second. So I wanted to, I wanna wrap up on, on another exit. So, oh, I'm sorry. There was, there was another, um, uh, brand that I had gotten into on the insurance side and, uh, still am a part owner in, uh, investor in, let's put it that way. And so we had built up the brand over a period of time. I, obviously, I'm the franchise sales side, run the teams. And I've worked in multiple capacities within these organizations. And so we've grown from, you know, one state to 33 states in two years. Very attractive growth model. And we were purchased by a private equity firm. And so private equity exits are very different than business owner to business owner on a franchise side. So that's small potatoes compared to a, a PDE firm coming in. The due diligence, uh, the length of time, the expectations and the contract to purchase is wildly different, uh, as you can imagine.

(17:35):

So, you know, that's one of the things I I, I do caution people is, uh, if it's not in writing, it didn't happen. So when you look at this and people say, no, no, we're gonna do this for you. We promise you X, we're gonna, I wanna see that here. I wanna see that exactly written out because as an attorney, we'll know, you know, you get promised stuff all the time, it wasn't in the deal. Like, that's not part of the deal. And then people change their mind. I don't recall saying that, you know, whatever it might be. So the expectation, they'll treat you very, very nicely on the front end. They're gonna woo you. They're gonna, because they want your business, they wanna gobble up and add it to something else or flip it down the road, whatever it might be. So always, always get it in writing.

(18:14):

And that's, that's, that's, that should be commonplace. But you know, you, you tend to forget a few things or hey, you're gonna rush to close the deal 'cause it's the end of the quarter, the end of the year. There's tax benefits, there's all these things that come into it from an owner perspective. And so you just have to be really, really, really diligent on making sure that what your parts are all clearly written out, you know, with you and your attorney, and you don't forego any stuff because down the road you won't be able to claw that back. It's just how it is. So cautionary tale, um, I thought it was a very good transaction overall, you know, financially, but, uh, you know, the future aspects of it were not clearly written out. And so, you know, you get what you get, you know, someone bought your business and I've never met a founder who sold their business that said, that was the best thing I ever did.

(19:00):

Right? Because they come back and they're like, well, they change this, or, you know, Hey, I didn't, I never liked it that way. Why are they doing X to my company? Or why are they laying off Sally Joe? She's one of my favorite people there. Well, you don't own it anymore, right? Someone else is making these business decisions. And so you have to get very comfortable with the fact that that's your baby and it's no longer your baby. And so that's, that's usually the hardest part for most people that are in the ownership stand, is, is that's not my baby anymore. Right? That's someone else's baby. So you, you traded money for <laugh>, you know, for the difference. And so you have to be prepared for the, the ramifications of that. So, um, those exits are very different and they're much more, uh, tedious and much more right, laborious as far as the, the, the due diligence goes. And so, um, very lucrative can be very lucrative from the owner and step away, but you have to be prepared to step away. And, and anyone who thinks they're gonna stay in, uh, has not read the PE playbook, uh, because the owner stays in for about 14 seconds and then they are sidelined and then they're gone. Because you don't want a legacy, you know, folks in there if you, right,

David King (20:05):

Right. Yeah.

Chris Pflueger (20:06):

Just

David King (20:06):

People don't wanna have so many chiefs and not enough Indians, as they say. Yeah. And, and any, you know, a financial buyer, uh, you know, a private equity family office or whatever, they're buying your business because they believe there's more juice they can squeeze, and they may be promising that there's a whole lot, and then they may not be able to ever get what they expect for it. So a a simpler transaction is often a, a, you know, a nicer thing for a peace of mind. You've got a few more years of, of toil, just like you're saying, and then complexity and all angles of the transaction.

Chris Pflueger (20:47):

Well, it's, it's interesting because if, if you liken it to selling your house, right? It's like selling your house and living in it while they knock down the walls and paint this room and rip out the flooring. And I never liked that. You know, the, the curtains people put in the crazy, and you have to be there while it's going off. And so it's, you have to have a lot of intestinal fortitude to watch, you know, your, your stuff being torn out. But you have to have the right mindset. Like, listen, I'm understanding I'm moving you on from this. Even if they say, I want you to stay on for a year, you know, that's usually on paper, right? They usually want you there for the disposition, and it's usually for continuity as opposed to your real input. So even if they say it's really your input, it's really not for your input. So it's, it's, it's, it's something you have to get used to as a, as a seller, regardless of what you're selling. And, you know, you just have to be prepared for that. So, and again, it's not a bad thing, it's just that's the real world. That's how it works. So, so

David King (21:43):

Your next business, tell me. Yes.

Chris Pflueger (21:48):

So, uh, because of my lengthy stay, obviously in, in the real estate realm and in running offices, I had 42 offices at one time, uh, underneath, uh, one umbrella for four different states and were, you know, billions of dollars of transactions. And so I've also worked in multiple parts of the United States, uh, covering different offices from a support perspective, uh, as the director of different regions for, for re max did trainings in other parts of the world. So I'm familiar with obviously, uh, the ins and outs of real estate. I was one of the few peoples I mentioned licensed. So I'm licensed now as a broker in Florida. And the new venture is a real estate venture. And so, uh, i a d is the, is the company name. Uh, most people in the United States have never heard of it. There's 20,000 agents. It's a European based brokerage, it's virtual, and one of the, it's the largest in France and the fastest growing in Europe. So, um, I was contacted to, to come in and help build the brand. And so I'm the managing director now. Uh, it's Florida only as we stand today. So we're, we're growing out the business, we're doing a grand opening in the next, uh, month. And, uh, it's gonna be pretty exciting. So we're, we're pretty excited about growing a new brokerage with a different type of a model in the us

David King (23:00):

Welcome back. And I'm gonna, we took a brief break there. And so Chris, I have, uh, twice jumped ahead to I a d but I wanna go back through the sequence of your experience in mergers and acquisitions, because after your sale to, uh, with the private equity sale and you departed, you got involved in a lot more smaller transactions, both as a buyer and a seller and a facilitator,

Chris Pflueger (23:35):

Correct? Yes. And so there's, there's, there's quite a few out there. Most of the transactions are not hundreds of millions of dollars, right? It's normally a transaction is someone that has a multitude of stores, and someone would like to buy your territory, your stores, your area, whether it's in franchising or not. And so those are not unusual transactions or normally, uh, normal size, right? They're not, they're not massive size transactions. And with those, you know, the tendency as you grow a business is you tend to weave in personal things, right?

David King (24:10):

Absolutely, Chris, it's always personal things. And as the, uh, they said to Sonny, Sonny, this ain't personal, this is business. If those use, given that vi advice to folks, I,

Chris Pflueger (24:25):

I've given the advice of, you know, you've got two options. It's either a very expensive hobby or it's a business. And if it's, if it's a business, then you have to operate like a business. And so when your valuation comes in and someone says, okay, you took a lot of owner, uh, you know, liberties with some of the stuff, you know, for your cars and this expense and that expense, you know, they're not gonna give you that valuation, right? They're gonna, they're gonna take, reduce all that and see how it actually fits in there. Uh, if you decide to employ your cousin, uh, your mother-in-law, your friend, you know, those type of things in there, they may wanna remove those folks. So for you, right, it was, you built this up all the time there, it's very personal. On the other side, it's a business and they're trying to eliminate all the expenses they can to maximize their return after the fact, right?

(25:13):

So nothing is personal, it's always business when it comes to that. And so if you want, if you want some sort of, um, uh, accommodation for, you know, because you have your mother-in-law working there, uh, you may wanna build that into the price, right? You may wanna say, Hey, she's gotta stay on for the next year and a half, or I'm gonna take, you know, equity outta my side and give it to hers. 'cause we're gonna move on from her. You know, just make sure it's, it's, it's well communicated because no, no one likes surprises. And that's right, that's general <inaudible>, but it's a natural inclination to, it's your own personal business. You bring people in, you do things your way, and, you know, it's not something that someone would do if they started from scratch, uh, of their own business, right? So that's one thing I would tell people is, you know, just keep that in mind. Always business. It's never personal. There's no, you know, malice and someone's, oh, the guy never liked me, so that's why he's, you know, firing this person. Nothing to do with that. It's just that's how business works and you'd expect it, right? They own they own the business now, and you expect to make those changes. So, um, that's one of the things that comes up quite a bit, because we're all dealing with people. Yeah. It's, it's always, it's a people business,

David King (26:21):

Right? And Chris, as you know, when it comes to the, that aspect and the valuation and all these personal expenses they've been running through, there's a great out to that, that just the bank will not accept that the bank is not gonna accept all these add backs and boost the valuation of your company. So those were expenses, you know,

Chris Pflueger (26:44):

And, and the best part is, you know, that's why you use professionals on both sides, right? That's why you have, right, you know, you turn your representation on both sides so you can make an, uh, an unemotional, you know, decision and on both sides and saying, okay, this is how we're doing it because, and that's why people negotiate houses that way. That's why unfortunately divorces work that way, otherwise, you know, it's just two people getting, you know, butting heads. And the reality of it is, you know, you both want the same thing. If, if someone wants to buy it more, as much as you wanna sell it, the deal's gonna happen no matter what. But you can make it very, very, um, you know, easy by having these conversations up front and documenting everything you really want, and you're gonna acquiesce some things and they're gonna give on some things. And, you know, uh, everybody, you know, the, the old rule is if everybody thinks it's a bad deal, right? It was a good deal, right? You know, everybody, everybody thought they lost gave more than they wanted to. It's a,

David King (27:35):

Yeah. And what were, what were the nature of the businesses that we were working in? Both of the ones you, you bought and sold, and then where you kind of acted as a facilitator? What industries were

Chris Pflueger (27:47):

We talking about? Wide variety, right? So it goes everywhere from, uh, fitness, different fitness, uh, operations to, uh, almost bought, uh, two different fitness operations myself personally. Uh, almost bought a restaurant, a franchise, uh, at one point as well. Just couldn't come to terms on locations and territories through the franchise. And, uh, fortunately I'm on the fitness one. It was right before Covid. Luckily I did not pursue that one else. I'd be carrying a lease for two years. But, um, very lucrative opportunities. You just have to have the right situation for you, right? So, um, it was those I had brewery, uh, you know, uh, operations or restaurants. We had multiple locations, uh, looking to, to sell the entire package, not one at a time. So it varies widely in business, but again, it comes down to numbers, right? There's always, if the numbers make sense and it's, it's a desirable product, there's only someone that can buy. So,

David King (28:40):

And if you, somebody asked me difficult businesses to sell, uh, and difficult businesses to own, uh, and only two of them, I would name restaurants and gyms. Those are not easy deals for people that are looking to go out and be entrepreneurs.

Chris Pflueger (28:58):

Well, I'll tell you that one thing you can guarantee it's very difficult to sell if it's you are the, you are the person that's really driving every aspect of it and removing you as being in the business, it collapses. That's a problem, right? If you haven't built systems around your stuff where you can step away for a month at a time, then it's gonna be difficult for someone to buy that business without you there. And so, right, that's what I would say is, is a great piece of advice for someone is set up your business where you don't have to be there 24 7 for it to operate or else it's not a saleable asset, it's your personal job.

David King (29:32):

Yeah. At some point you, you can't be the operator. You've just gotta be the owner. And when you're just the owner, that's when you're at a point that you can truly sell.

Chris Pflueger (29:44):

Exactly. And if it's called, if it's called Crisper's hamburger stand, also very difficult to sell. Just naming

David King (29:50):

Your marketing guy would say that you probably ought to go with another name for a burger. Yeah. Well, now let's, let me hear about I a d 'cause this is an interesting business model, and I wanna, so

Chris Pflueger (30:08):

It's 40,000 agents in Europe. It is the fastest growing, uh, you know, real estate model in Europe. Uh, we also have location, uh, a location or a setup, uh, operation in Mexico. And so another almost 2000 agents during Mexico. So a very big, you know, outside the United States just coming to the us bringing a brand new model in there, virtual real estate model, very similar to some other ones that have been here. Ours is a little bit more well established, and, um, I like to think it operates a little bit more, a little bit better, a little bit more cleanly, but it's really set for agents who really wanna participate and have a community-based feel. Um, the brick and mortar is kind of on the downturn. One of the reasons I I don't, I no longer work for a traditional real estate model is it's, it's not desirable to clients anymore, right?

(30:57):

So you wanna make sure you have the technology and everything in, in place for agents to operate, which we do. And so, um, I think it's one of the best models in the world. So it's, uh, it's pretty exciting. We're about to launch at the end of September and then have a grand opening in October for Florida only. And then, uh, I a d will be growing, uh, its real estate brand throughout the United States as we move forward. So pretty excited to be on the ground floor of this, uh, bringing all that business experience and all the real estate experience into one area. Something I've been looking for for a while and found the right, right place.

David King (31:31):

So, all right. I, I think I've got it clear here. If somebody wants to be part of I a d, they don't have to have a broker's license. They can be just licensed as a sales agent, but instead of having one broker who's gonna be riding their backside, they're now part of I a d and it's, it's, you know, there's, there's a broker licensed in every state, but you're just part of a network. It's of support. Is that a fair

Chris Pflueger (31:59):

Yeah, that, that's a fair statement. And we have like a, a mentor forever type model. So it's similar to the fraternity, right? You still have a big brother that have a mentor above you and, and several layers above that. And you can recruit people and bring 'em in, and you're their mentor, right? As you bring the people in. So you, people you like to work with, people you know, are gonna be productive. You bring those people in, you work with them, and there's a second line of revenue for you because you're, you're getting paid to be a mentor as well. So it's, uh, in, in the real estate, you know, industry, it's a little bit unique, but it is very, very, um, uh, proactive, you know, when it comes to being able to get out in the field and do what you need to do and not have to worry about geographic territories or am I stuff off of the office or, you know, are they any good in this location versus that location? This is all online, all virtual and set up just this way. So, um, it makes it very easy for agent to operate, but still have an entire support network around.

David King (32:55):

So it's got the virtual nature. And so, you know, but in no way, shape, or form is it one of these just online listing things like Redfin or nothing, but it's not the traditional broker model where you're working for one person who's your, who's your designated broker, and you have a handful of agents working there. It's, yeah, you're,

Chris Pflueger (33:18):

You're in it together, like your whole, your whole group, you can build a huge organization. There's, there's folks in Europe with 600 people in their organization and, you know, they're, they're basically coaching and mentoring all the time and selling real estate. So it just depends on how large you wanna get, which side you wanna go down. But at the end of the day, uh, it's great for the clients because we have people coming over from Europe with 20,000 agents. We have referrals on a daily basis. We have nowhere to put them right now. We have, we have, you know, very few people we're starting out. And so, uh, we have on a daily basis, I get a call about people a looking to come over and be part of it, or looking to send referrals over from Portugal and Paris and, and Spain and Germany and Italy. And so there's just, you know, just a ton of opportunity for folks in the US to really kick this off. So, pretty exciting. So,

David King (34:08):

Chris, to bring this to closure here, you've been through so many different experiences and had a rewarding career, and you still enjoy, I, I can tell you still enjoy what you do. Um, your advice to somebody who is maybe finally, you know, they've worked a couple of years or something, but they're looking and now go out and do something more entrepreneurial, what would be a couple of things that you would recommend to them so that they don't, uh, end up on the wrong side of deals?

Chris Pflueger (34:43):

So just like with purchasing anything, right? As you go through, you wanna make sure that you don't have the opportunity. Sorry, I, I'm doing a film here, so let's pause that for a moment.

David King (34:53):

I, I love it. Yeah, no,

Chris Pflueger (34:57):

So I'm having a little bit of a <laugh>,

David King (35:00):

I guess. No, no, no. It's a personal charm. It's

Chris Pflueger (35:03):

Literally never happened before. <laugh>,

David King (35:04):

I'll, I'll tell you one, I can talk that I was doing Craig Kilborn on, on my show, and my dog comes next to me and shakes her, her ears or what, you can hear her collar and her ears flopping and everything, and Craig just laughed the whole damn thing off. So don't worry, I switch

Chris Pflueger (35:23):

Into a room when talking. I dunno, I don't, yeah, let's start that again. So the advice personal

David King (35:29):

Jar is great. Go ahead.

Chris Pflueger (35:32):

The advice you'd have for, for someone starting out, so, you know, two pieces, right? You know, take it seriously. It's a business. And I always joke, you know, make sure there's no ether on kind of future cast this, what's this look like to you in six months, right? Is this still exciting? Is it still sexy? Is it still something you wanna do when you're actually doing the work, right? Talking about getting into a business and excitement and hey, we're gonna put this, you know, signs up or we're gonna really go out there mm-hmm. <affirmative>, that's the, that's the, the event planning portion of our show. The actual, I'm gonna work, you know, 80 hours a week and I'm gonna actually make this into a business. If you still love it, when you think about it in six months or a year, then you should probably do it right? Because the people I, I've, I've interviewed, I can't tell you, thousands of people looking at different franchises and opportunities for businesses and the people, you, you can never tell who's gonna be successful just by their resume. Because I've had people with the strongest resumes, plenty of capital, and they fail on lunch.

David King (36:30):

I

Chris Pflueger (36:30):

Dunno why. I just, I just, it just happens. And then you have the folks that were scraping the, the, the bottom of the barrel borrowing money from the family, just getting ready to go out there. And in six or seven years, they're the, the largest in their region. It's because it all comes down to passion, right? It all comes down to something that's hard to define, but it's really that desire to be successful. And if you've got the grit to be an entrepreneur and you're excited about doing that, then you will be successful, right? It's just a matter of what business you decide to be in. So to me, it's, it's, you know, do a, do a check, do an internal check to make sure that you're ready for this. If you're a guy who wants to just collect a check and just go into the work from nine to five, you know, it's a very, it's a difficult transition, but if you can do it successfully, you'll make a lot of money as an <inaudible>. So

David King (37:20):

What about the advisors that they need to get off on the, on the firm footing so that they don't go back to the very beginning and find the things that they did wrong? My simple advice is, you can't go into business if you don't have enough money to hire a c p a end of story. The business, the very first person you should talk to is A C P A I. And people will ask, do I really need an attorney to set up my business? And my simple answer, God's honest truth, if there's only gonna be one owner, you might be able to set it up initially by yourself. It's always good to have an attorney on hand. If there's gonna be two owners, you sure as hell better have a lawyer involved,

Chris Pflueger (38:05):

Well, you're back to begin with the end in mind, right? You know, so if you're going as a partnership, you have to think through all of the things that could happen, and you have to plan for that before they happen because you don't get that opportunity afterwards, right? You don't buy life insurance after you die, right? So it's, it's, you have to think through this, and I would say the best money ever spent, and, and we have this conversation all the time with folks, they're like, well, do I really need to, if it's already outlined, it's already documented, uh, a hundred percent. Like you want someone representing you. 'cause I don't represent you and my side doesn't represent you, we represent ourselves, right? So we wanna make sure you're represented as well because you're making a clear headed decision and you wanna make sure you go eyes wide open. So spending the money on your cpa, on your accountants excuse, on your, on your attorney, those are the two things you cannot, you don't wanna cheap out on. You don't wanna, because it seems like a lot of money up front, and then the business grows, and now it's a multi-million dollar transaction and you set it up incorrectly,

David King (39:02):

Right? Right.

Chris Pflueger (39:04):

And then there's, there's tax ramifications, there's unwinding things. Your partner now owns more than you do because you decide to sign something over by accident you didn't even think about. It's no big deal. We're friends, it'll be fine until you're not, then it's a problem. So it's always wise to have your own representation and spend the money up front, set it up, correct

David King (39:23):

Every time. It, it's kind of like saving money to, by not going to a dentist. You, you can do that for a couple of years, but when you finally go, it's gonna hurt like hell.

Chris Pflueger (39:32):

Yeah. It's same thing with anything, right? Same thing with, you know, not saving for retirement. I'm sure I'll have a job seven, so no big deal. Yeah, it's not like that, right? So you wanna plan ahead and be, and, you know, be smart, right? You know, just yeah, be a business, what would happen if, and then make, make sure all those contingencies are covered and make sure you can live with it. Because when it's small and you just started out and you're putting it in $20,000 each and we're gonna see how it goes is very different than what, hey, now it's a 50 million business and you know, uh, this, you, you your partner and you are having some disagreements on who's running what, and then you have to separate you thought that through because yeah, that could be very expensive. So then everybody gets greedy at the end. Everybody gets greedy at the end. So,

David King (40:17):

Well, Chris, I promise you this, when I write the second edition of my book, I'm gonna set aside a couple of pages for you. And I don't worry about the grammar and all that stuff as the lawyer here, I better be able to edit sort of things, but we're gonna have the fluger advice there to you from real world experience. The school of hard knocks.

Chris Pflueger (40:40):

That's where it comes from, right? So it's, it's take advantage. You might as well listen to other people who did it one way or the other, good and bad and, and, you know, take it for what it's worth. But, uh, I appreciate you having,

David King (40:51):

And I appreciate your great success and, and, um, it's really nice to see you and catch up and, uh, God bless you and your family and I hope everything goes well for you. All the guests. Uh, thank you so much for joining us on, uh, selling Your Business with David King, and we will see you next time.