Thank you so much for joining us in this interview series. Before we dive into our discussion about succession, our readers would love to “get to know you” a bit better. Can you share with us the backstory about what brought you to your specific career path?
It’s a story I tell a lot. Previously, I was a professional baseball player for 12 years. I was introduced to a stockbroker who recommended investments to me. I didn’t pay much attention to it; just sent money.
In the mid-‘90s, my stockbroker called with an opportunity to invest in an IPO for a digital printing company, which represented a groundbreaking technology back then. We bought the IPO with a sizable investment at about $20 per share. After several months, the stock started going up, and I became much more attentive to it.
While on baseball road trips, I read the daily paper and watched the stock double and triple in value. I called my broker, “Wow, we made all this money, should we sell?” He said, “Oh, no, this thing’s going to keep going.” Sure enough, over the next year, the stock went up to almost $200 a share. I thought the broker was a genius.
Then the stock started falling like a rock. I called the broker but couldn’t get him on the phone; only his assistant answered. I just said, “Sell it all right now.” While I had made a good sum of money, I realized that no one was paying attention to me and my investments. I didn’t fault him; that’s just the way it was back then.
At that point, I took over my portfolio and managed my money. I tried everything, including day trading in the mornings before games. Then I began reading and educating myself to learn what makes the economy tick and the market move. At the same time, while playing in Texas, I met a couple of financial advisors from a big investment firm. They said, “When you quit playing baseball, you should think about being a financial advisor. You’re smart and have the right business acumen for it.”
I thought, “No, I’m never going to be in an office, I play ball.” Six surgeries and a whole lot of pain later, I retired thinking, “What am I going to do?” With two young children, my wife and I decided to move back to Florida where my parents were living.
I contacted the financial advisors I had met in Texas; however, they wanted me to come back to Texas. Since I wasn’t prepared to leave Florida, they were nice enough to put me in touch with another firm. After a two-hour interview, with discussions about baseball and finance, Morgan Stanley hired me, where I stayed for nearly eight years. After building a sizable business, I joined UBS, where our team continues to grow the business we love.
Can you share the most interesting story that happened to you since you started your career?
About 12 years ago, our very good client, a successful retired engineer, pursued his passion to learn how to play the cello. In his mid-60s, he diligently took lessons every day and became an expert cello player. While he was traveling in Prague, we received a call from him in the middle of the night about buying a celebrated cello he found in a small antique shop. He needed help converting U.S. dollars to buy and ship the cello home. Within 24 hours, we were able to do a currency conversion and wire transfer to the Prague merchant for payment and shipping instructions. Our client was so excited and appreciative.
I tell that story because it’s a non-investment story that shows our deep commitment to clients and differentiates our team. We try to be that trusted, reliable team for our clients ― the person that you can call in the middle of the night to help you. We pay attention and listen to what’s important to our clients as we help guide their financial strategies.
Can you please give us your favorite “Life Lesson Quote”? Do you have a story about how that was relevant in your life?
I believe the people that you surround yourself with can either inspire you or drain you; select them wisely. Both in sports and business years ago, I realized some people can bring you down or elevate you to new heights. I remind my daughters, who are 20 and 22, to select friends carefully. It’s the three to five people you spend the most time with that can positively influence you. Look for people who have the same values and want to do the right things in the best interest of their families, friends and clients.
What do you think makes your company stand out? Can you share a story?
Based on my experience, I believe UBS and our team set ourselves apart on a variety of levels. We have experienced people and diverse resources to understand our clients’ needs and navigate even the most complex financial situations. For example, last week our team set up a very large private family foundation for an ultra-high-net-worth client with whom we have worked with on an individual and institutional level.
You are a successful business leader. Which three character traits do you think were most instrumental to your success? Can you please share a story or example for each?
- 100% work ethic. You’ve got to do the work, whether anyone is looking or not, even on the weekends.
- Self-discipline. Playing professional sports, you learn that self-discipline and showing up every day make a difference.
- Competitiveness. In sports, it was competing against other teams to win. Today, in wealth management, it’s competing in our industry to create better financial solutions for our clients to help them enjoy the lives they’ve dreamed of with confidence. We’re always asking ourselves, “How can we provide our clients more measurable value aligned with their goals?”
Leadership often entails making difficult decisions or hard choices between two apparently good paths. Can you share a story with us about a hard decision or choice you had to make as a leader? I’m curious to understand how these challenges have shaped your leadership.
Giving up short-term wins for long-term gains. As the leader of a team, sometimes you have to give up short-term revenues for successful long-term solutions for your team and the clients you’re passionate about serving well. There has to be a good fit of shared values and mutual respect between everyone ― the team and the clients.
As you’re building a company to grow, bringing on the right people can be challenging. We look long-term for the right fit. That takes patience and persistence to find the right person with similar self-discipline, values, and work ethic to help our clients succeed.
OK, thank you for that. Let’s now jump to the primary focus of our interview. Let’s begin with a basic definition so that all of us are on the same page. What does succession planning mean to you?
Succession planning is having a prudent, thoughtful vision and process for how you want to see the future unfold. It’s not just picking the company or the person that’s going to take over.
It starts with the business owner thinking about what they want their life to look like in retirement or post-exit of their business. If you think your company is going to sell for $50 million, what does that do for you? What do you want your life to look like? And then, how do we get you to that point through the exit of your business?
A big misconception of succession planning is that it’s done a year or two before the exit. The reality is you should start succession planning decades earlier. The sooner you envision what you want, the more prepared you are for a successful succession and business exit.
Whether you’re the owner of a startup seeking a quick exit or the owner of a decades-long, established business, you need to be intentional about what you want and diligent about the steps you need to take to get there.
What are the nuanced challenges often faced in succession planning? What are the strategies to overcome those challenges?
Beyond starting too late, the other challenge is aligning the vision of multiple partners or owners. They don’t need to have the same vision for the future, but they need to be in alignment toward a common goal, based on their varying stages of life circumstances. These stages can include whether they’re married or divorced, whether they care for children or aging parents, and what state of health they’re in.
We encourage and facilitate group discussions with our client and their partners to help them understand each other’s goals and objectives. Often these discussions include family members who may be a part of the succession planning. Together, we foster collaborative relationships to develop a road map for the future.
How do you cultivate an environment that not only identifies but nourishes the hidden talents within your organization? What practices have you found to be most effective?
Understanding and valuing people’s varying personalities is key. While I’m a “show up, do your job, and get it done type of guy,” I realize that others need encouragement, recognition, and stimulating challenges to reach their full potential. We acknowledge that our team needs each other’s support and appreciation to best serve our clients.
We review our personality profiles to better understand how to interact effectively with each other. How people interact with me is different than probably everybody else because I’m a strong type-A personality. I like to get to the point, understand the issue, and find a solution.
We also try to engage on a personal level outside of work. We’ll bring in lunch and talk about our families or participate in an activity outside of the office. We’re constantly working on our culture. We want to make sure people feel connected.
How has your baseball experience influenced how you manage teams in a corporate setting?
Like in baseball, work is an individual endeavor within a team setting. For instance, a pitcher can be stellar within an average team. You could be a Hall of Fame hitter and never play in the championship game, or be part of a group of average players that come together to win it all.
We work toward getting the right people on the bus and in the right seats so they are motivated to perform at their best every day. I had several great managers while playing baseball. They found a way to connect with every guy on the team by understanding their personality and background. We try to bring that forward in helping our team. We’ve got 10 people on the team with 10 different personalities. We align together to create the best-performing team for our clients.
What’s your philosophy on growing talent from within versus attracting external talent? How do you find the right balance?
We recognize that every team member is an integral part of our business and needs to feel appreciated and positioned for growth. My main assistant has been with me for 18 years. We can’t run the business without her. Clients appreciate the work she does. The key is understanding what people want and developing a path to help them succeed. Our newest team member is 23 years old, right out of school. Our goal is to help her envision a path forward. It ties back to listening to what people want and need to be successful and valued. Having a long-term vision for our team and clients over the next five, 10, 15 years with strategies in place is critical.
What’s your approach to ensuring that succession planning is a holistic process, and not just confined to the top layers of management? How do you communicate this philosophy through the organization?
The holistic process lays the foundation for the organization and everyone within it. It sounds simple but communicating with people is essential. Having conversations early and often to determine what succession looks like for our clients is key. I’m a Certified Exit Planning Advisor (CEPA®). For business owners, we’ll do a valuation of their business. We meet with owners and use that valuation as a conversation starter, offering potential sale numbers for the business. But we also examine what that means to a business owner on a personal level for achieving their long-term life goals.
We have conversations about what the future looks like for the owner and their team. Do they stay or leave? Is this a strategic buyout or is it a private equity acquisition? Based on the answers, we help create the appropriate structure. One business we helped sell last year went to a private equity firm and everybody, including the owner, stayed to continue to work. It was a great outcome. For another company we helped, both owners retired from the business.
Again, it goes back to communication. Communication is significant on our team for clients and potential clients. We try to connect with people where they are, personally and professionally. Many people engage with us because they’ve been receiving information from us, whether it’s in educational emails, online communications or discussions.
Clients realize that they need a team that is fully involved in their succession and business-exit planning. We want clients to call and say, “I’ve been reading about you over the last few months. I’d love to talk about succession planning with you.” It’s all about building client trust. We lay everything on the table and discuss options openly, being empathetic to our client’s interests and doing the right thing.
What are your “Five Things You Need To Do Effective Succession Planning”?
- Plan early. That’s one of the key components is to start planning early. You literally could plan the day you start a business. That forethought leads to having the business structured properly.
- Build the right team. Not only for employees, but the right team of advisors to act as a quarterback for clients, including financial advisors, CPAs, and attorneys. Not enough people understand the real value of specialized expertise to build a solid team and be willing to rely on that team and the information they provide. Sometimes, owners build a team and fail to listen to what they have to say. So trust the team you’ve put together and listen.
- Involve your family. Another key element is having your family involved and on board with the succession plan. The matriarch or patriarch in the family who owns the business may want to sell. But many times, kids are involved in the business. What does that look like if everyone’s been operating through the business and it goes away? Is everybody on board with that?
- Envision your legacy. Ultimately, think about what you want your legacy to be and what you want the rest of your life to look like. It’s hard for people to work 50 to 80 hours a week growing a business and then sell it, finding themselves with nothing to do. We spend a lot of time talking with owners about what the next phase of life looks like. For some people, that’s golfing or fishing, spending time with kids and grandchildren, or working on private foundations and charities. People need to continue having a purpose in life ― that’s of paramount importance.
- Define what a successful succession looks like to you. It’s different for every person. Think about the outcomes you want. The worst kind of exits are forced when somebody dies, somebody is disabled, there’s a divorce, or the business is distressed. You want an exit that has been thoughtfully planned, including options for if and when unexpected circumstances occur. More planning done ahead of time improves outcomes.
Off-topic, but I’m curious. As someone steering the ship, what thoughts or concerns often keep you awake at night? How do those thoughts influence your daily decision-making process?
First, how do we add the most value for clients? We continuously innovate and deliver more services and better experiences for our clients. Second, ways to grow the business. It’s easier when you have a little rowboat to get a bigger boat. When you captain a cruise ship, it’s harder to maintain and navigate forward. We relate to our clients on this shared challenge.
You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
Greater education about succession planning, estate planning and alternative investments. We spend a lot of time educating our clients. I’m a big believer in using alternative investments for clients. Very few clients are educated about alternatives. They either embrace it because they understand it, or they run because they are unaware. Alternatives do not necessarily mean something high-risk and crazy. It can mean something different than a stock or bond to help build a portfolio that seeks to generate consistent returns and potentially minimize volatility. That’s really what we’re after in our business. We help people stay the course.
When everyone is more educated on the way that government, finance, and economies work, we can have different conversations and make more informed decisions. A more educated world helps to create a better society to impact families, communities and nations for generations to come.
How can our readers further follow you online?
https://advisors.ubs.com/wpwm/Index.htm
Thank you for the time you spent sharing these fantastic insights. We wish you continued success in your great work!