Armando (0:00 – 1:59)
Hi, I’m Armand Roman, host of the Founders Guidepost. You’ve built your business over decades, and now it’s time to think about that once-in-a-lifetime exit. You’ve come to the right place.
Here, you will hear business exit professionals talk about what you should know before exit. Besides hosting the Founders Guidepost, I’m CEO and founder of Axiom Founders Family Office, working with founders to help preserve their American success story. And it all begins with a founder stress test.
We also host the Scottsdale Founders Forum for the founder considering exiting in the next 36 months. Here’s to your hard work and to your American success story. Enjoy.
Hi, Armand Roman here with the Founders Guidepost today with Sharon Lecter. And Sharon is such an accomplished person that it’s going to be hard for me to limit my introduction, Sharon, because you’ve got so much that you’ve done and so many things that you’re part of. Obviously, you’re an best-selling author of over a couple dozen books.
And I think of you as the financial literacy expert in this country, if not the world, because we met through a Common Financial Literacy National Commission years and years ago. But in addition to that, I’ve seen you up on stage. People love to hear your messaging.
They love to hear your motivation. And you know what I get a see you up on stage is I get a sense that you, Sharon, you want to see people successful and you want to see them fulfill what they can fulfill. And it seems that often you’re helping them to understand that, helping them to realize that.
And you just do so much to help so many people. You’ve been a licensed CP over 30 years. And Sharon, I know I haven’t even touched on the surface of your accomplishments and what you do and who you are, but I am so thankful that we’re having this conversation today.
Welcome to the Founder’s Guidepost.
Sharon (1:59 – 2:07)
Thank you, Armando. I’m delighted to be here. And I just applaud what you do and the families that you help and anything I can do to support.
I’m here.
Armando (2:08 – 2:40)
Fantastic. Fantastic. Thank you.
So, Sharon, I do want to touch on, I guess, as foundational when I think about you, I think of financial literacy. And I really think of you as having that as a core. And that is such a missing element in our American education system, in us as a country, as a people.
And so I applaud you for the work that you’ve done over the years to help people understand and learn more for their own benefits. So thank you for that.
Sharon (2:41 – 3:27)
Well, thank you. It takes us, you know, everybody needs to stand in the truth. And the truth is we are not preparing our children for the financial world they face.
And so I’ve been on a mission as a long time since December of 1992. And I’m still on that mission. There are now 25 states that require a semester personal finance class for high school graduation.
And that’s wonderful. Unfortunately, Arizona still hasn’t gotten to that point. So I’m in the midst right now of phone calls before this podcast afterwards, still working with the State Board of Education here in Arizona, trying to get them to wake up and realize that we need to make sure every high school student gets a semester class of personal finance.
Armando (3:27 – 3:31)
Well, I hope that that becomes successful sooner than later for everyone’s benefit.
Sharon (3:32 – 3:32)
Me too.
Armando (3:34 – 4:58)
Sharon, in Arizona, where we live, we live, of course, in a very beautiful state, geography, climate. Except for a couple of months in the summer, it’s pretty darn fantastic. But I say that because as our state has gone through its own economic changes over the last 10 years, it seems that our economic base has been changing.
And more and more people are realizing that Arizona is a great place to have a business. And there’s such opportunity here in our state. And we’ve seen a lot of private equity money hovering over our state to gobble up those local companies.
And our leadership in the state has been, I think, successful in attracting good companies. So I think a dilemma that is happening in our state is that many of those business owners who have never sold a company before are now suddenly being courted by people and being offered big money, but they’ve never gone through a sale before. And this is, of course, can be a life-changing event.
So for those people, as you think about the work that you do, you obviously coach companies, you mentor companies, you help them grow, you help them from so many different perspectives. As you think about that owner going through that, thinking about going through that exit in the next few years, what thoughts come to your mind for them that could be helpful for them?
Sharon (4:59 – 6:21)
Well, Armando, any business owner, the vast majority of business owners are passionate about what they do. And they are focused on accomplishing that, but they don’t take the time to build the foundation of their business. And so they end up owning a job, not a business.
And so I teach people to understand the basic foundation of the business and build it strong because you want a successful business, but you want that one that is sustainable and scalable and saleable, whether you choose to sell it or not. You want to build a strong, thriving asset that allows you to get your time back because that’s the beauty of having a business that is operating with the right people, the processes and the products. You’re serving a community, but you’re also building an asset that can operate without you so that you can start getting some of your time back.
And there are many successful business owners out there that are tied to getting out of bed every morning because they really own a job, not a business. And so that’s one of my main focuses is to help people understand how to build that structure, build that foundation so that you can not only have a successful business, but will have one that will continue to grow. Take it from seven figures to 10 figures.
Take it from serving one community to multiple communities. You have that opportunity if you build it correctly.
Armando (6:21 – 7:05)
Right. Exactly. Exactly.
And in that vein, I’m not done with this book, if you can see this on the screen here, but the Exit Rich, the book that you recently authored with Michelle Seiler Tucker, all about that exit. I’m so glad that you have that book out because the information in there is just really, it’s so valuable, really for any business, but for those who’ve never gone through an exit, helping them understand, what do you mean I got to sell my company? How’s that going to work?
They often don’t know the value of that company or even how to go about it. And as you’ve said many times, knowledge is power. Without that knowledge, they’re not empowered to have to end up in a good place for themselves and their families.
Sharon (7:06 – 11:57)
Well, almost all the time a business owner thinks their business is worth a whole lot more than it truly is. And so what Michelle and I did, we came together and this is what I do with my high level mentoring clients. And we took all this information and we put it into a very inexpensive tool that helps you understand the things you need to pay attention to in building your business.
And if you don’t take all those steps, then you’re hurting the total valuation of your business. Because the valuation of your business is not just your sales, it’s have you identified your intellectual property, your provider, have you protected it? That increases the value of your business.
Do you have business systems that allow you to have a fine-tuned machine? Those systems add value to your business. So we went through and we kind of tried to make it, codify it as the six P’s in your business.
And it starts with the people. Do you have the right people on your team? Many business owners have a hard time letting go and they’re doing things they shouldn’t be doing.
So have people on your team who are strong where you are weak, making sure the right people have the right mentors. Many people acknowledge that mentors are important. Very few people actually have them.
And so a mentor has been where you want to go. They can speed your success, help you steer around pitfalls and accelerate through introductions, through their knowledge base. And then understanding your products.
You may have one product that could be five or six, or you could have a product that you’re selling in Arizona that could easily sell in Europe. You just have to find the right association to do that. And then the processes.
That’s the business systems I talked about. That is the inherent operational integrity of your business. Your systems are so much easier to manage than personalities.
Understanding how you answer the phone to how you order your product, how you sell it, how you collect. Every step is part of the system. And you need to document it and have that so that you people can come in and really understand how your operations go.
A potential buyer is going to want to look at your operational manuals. And that is also intellectual property. Your manuals on how you operate your business, add value to your business.
And then you have the proprietary P, which is all about your intangible assets. Armando, 40 years ago, 85% of the valuation of the S&P 500 was bricks and mortar, only 15% in intangible assets. And now it’s more than flipped that way.
Probably more than 90% of the S&P 500 valuation is intangible. It’s in systems, it’s in databases, it’s in intellectual property that you can’t touch and feel. And so that’s actually leveled playing field for us because your small business can compete a lot better when it’s an intangible asset.
You have the ability to use the internet, you have the ability to build your business very quickly. And so the proprietary piece is very, very important. And it has tremendous value for your business.
And then your patrons. In today’s world, Armando, everybody’s excited about social media and social media is very important. And they have millions of followers, but you don’t own those.
Facebook decides to turn you off, you’re out to lunch. So it’s really important to use social media as a lead generation. Nurture your social media, but invite them home to your database.
Because many companies actually sell just for their database. And that again, that’s part of your intangible assets. So you have the people, the products, the processes, the proprietary, your patrons, and profit.
And most people focus on the product and the profit. And when the profit isn’t where you want it to be, it’s probably because one of those other P’s is out of alignment. So that’s what we really wanted to get across.
Digging into each of these areas for people to understand what they’ve done right, what they’ve done wrong so they can correct it, or what they still need to do. And in taking those steps, you build a much more profitable business. And as you talk about wanting to sell a business, you want to know about this stuff before you put your business on the market.
Because what happens is you ask $50 million for your business and a potential buyer comes in and you haven’t documented your intellectual property. So that $50 million just cut to 25. You don’t have the right policies and procedures.
And so that cuts it down. So do this ahead of time so you get the highest value possible.
Armando (11:58 – 13:04)
Yeah. And that makes a lot of sense. I’m so glad that is contained in that book that you were mentioning, the exit rich book.
Because for someone who has not gone through that before, a lot of this might as well be Greek. Because they’ve run a business, it’s making money, that’s great. But we had four events here in the last couple of years, the Scottsdale Founders Forum events.
And in those events, we had 150 founders come into our live event to hear from a panel of experts all about exit. And the number one question that we heard from those 150 founders here in Arizona was, what is my business worth? Is it worth 10 million or 50?
Well, maybe it’s worth both. 10 million if you do nothing, 50 if you focus on those six P’s and help build out everything that’s necessary. But it can be such a variation, such a range that it makes a lot of sense to have a conversation with you about this.
And for most business owners, this one company is their largest asset ever.
Sharon (13:05 – 13:44)
And they really the valuation may be different based on who the buyer is. There may be one potential buyer who really wants to operate in Arizona. They don’t have a footprint here.
So they’re looking at your value as something that expands their reach. Somebody else may just be wanting to get access to one of your biggest customers. So value is basically in the eye of the beholder, but you can do everything you can to make sure that value is the highest possible based on your operations, your sales, and your intellectual property.
And look for buyers that will benefit even more than that so that the valuation can be even higher.
Armando (13:45 – 14:11)
I read somewhere, you’ve mentioned intellectual property a couple of times. And I read somewhere recently that that Apple into the Apple iPhone logo, the Apple with the bite out, that that’s been estimated to be worth $2 billion. Just the Apple with a bite.
And if they didn’t have a good attorney or team of attorneys protecting intellectual property all across the world, that 2 billion could certainly evaporate, right?
Sharon (14:11 – 14:53)
Yeah. The Apple brand itself I’ve heard is over a trillion dollars. So that is, it is the largest intangible brand that there is in the world right now.
So it used to be Coca-Cola. Coca-Cola I think has been relegated to much lower, three or four. But it’s really important for people to understand that the intrinsic value of building your brand is very important and protecting it.
We talk about intellectual property, there’s really three stages. One, you have to create it, right? Which means you identify it.
Secondly, you protect it. And then you leverage it because that again, gives you another asset in your arsenal.
Armando (14:54 – 15:24)
Let’s talk about the leverage for a second. I think that people often create without realizing what they’re doing until later they realize, oh yeah, I do have a brand. I do have unique processes.
I do have a logo that is different. And then protect it, yes. Get legal counsel to help lock that down a bit.
But the leverage, I don’t know that, I’d like you to expand on the leverage if you could. When you think about leverage, maybe some examples on what that leverage might look like for that business.
Sharon (15:24 – 17:32)
Certainly. Well, I’ll give you a book example. When I wrote Rich Dad, Poor Dad, we didn’t have the resources to take it around the world, but other publishing companies, houses around the world wanted to leverage what we had created.
And so we licensed our book in over 50 different languages and over 110 countries, what allowed us to explode around the world. And we got a percentage of those sales. But we relied on their business systems, their people, their sales team.
They took it and expanded our message and we received a percentage of the sales. And so that’s called leveraging our intellectual property. In addition, my husband and I own a part of a company that does alternators and state-of-the-art technology.
And so at the time they were being supported by the US government using these alternators to power bases in the wilderness. And so we created that as a specific license for government. Then we had a different stream of revenue for commercial buses, a different one for commercial trucks.
So again, you need to figure out how to divide up your intellectual property and how to leverage it to the greatest opportunity possible for you. You want to make sure you don’t… For instance, when we did our French book, they wanted French worldwide rights.
Well, we quickly learned that they didn’t distribute except in France and Canada. And so why would we give them worldwide rights in something that they didn’t exist? And so it’s important to understand the geographic area for licensing, for rights, also industry-specific.
Why we wouldn’t give bus companies the rights to do trucks, because they don’t do trucks. And so you have to understand specifically what you’re leveraging and maintain ownership of everything else.
Armando (17:33 – 17:42)
That makes a lot of sense. That makes a lot of sense. So you could…
And licenses, royalties, maybe even franchising?
Sharon (17:42 – 18:23)
Mm-hmm. Sure. Franchising is a huge example.
It’s a very high-level sort of licensing in the fact that you create a system. Franchising is all about business systems. You’ve created a successful system in a particular industry, and you’re taking that in a cookie-cutter format, and you’re selling that system to somebody.
And typically, they’re going to own a territory, right? Sometimes it’s not that way. But most of them, if you think of a McDonald’s franchise, you’re going to buy the rights to run McDonald’s on this corner in this city.
And so that’s, again, it’s a cookie-cutter format.
Armando (18:24 – 18:37)
Wow. And if the person who owns that intellectual property didn’t really understand that, they could, as the offer was made to you to license in French all across the world, they might do it.
Sharon (18:38 – 19:23)
Right. Well, you get so excited. Somebody wants to support you and help you, and you’re just ready to sign.
So you have to stand tall on your own ownership of what you’re doing, because I see it time and time again. The vast majority of business owners give away valuation without realizing that somebody’s interested in helping you, supporting you. Get a contract from them is very exciting.
They may even have a check attached to it, and they want to support you in doing something, but they’re asking too far of a reach on what rights they want. And you give it to them, and then you don’t have them anymore. So it’s very important to make sure you have the right mentors, the right attorneys to help you fine-tune what it is that you need and what it is you want to give away.
Armando (19:24 – 19:50)
That makes a lot of sense. In your business coaching and mentoring that you’re doing, you must have a variety of clientele and have over the years had a variety of clientele. But I imagine there are some common themes that you see as you think about them, and maybe it is systems, intellectual property.
What are some of the common things you see when a client comes on board asking you for help that you’re able to help them navigate, understand, and be successful in?
Sharon (19:51 – 22:23)
Well, I take everybody through the same process. I have my book, Three Feet from Gold, which was the first book that I did with the Napoleon Hill Foundation. I share a personal success equation.
You can go to personalsuccessequation.com to get a free download on it. But it really is P plus T, which is your passion and your talent. So my passion actually came from anger because we weren’t teaching kids about money in school.
But you hear the phrase, do what you love, love what you do. And then talent, of course, as you said, I was a CPA for more years than I want to admit, and years in publishing. So I combine my passion and my talent, and most people do that.
And they stop there because they think they have to do it all on their own. So that P plus T is followed times A for power of association. Who’s on your team?
Do you have people on your team who are strong where you are weak? Do you have the right mentor? Do you have the right advisors?
And all those power of association is how you can truly leverage and grow your business quickly. When I first started in 1987 with the inventor of the first talking children’s book, it was a time when kids did not have electronics. I know it’s hard to believe, dinosaur days.
We had this electronic book. We said, how can we get parents to trust us? We’re this little tiny company.
So we did licensing deals with little companies like Disney, Warner Brothers, Sesame Street, because parents trusted those brands. And that allowed us to skyrocket our company around the world because of those associations. So power of association.
And then there’s a times A, action. How many times do we know what we’re supposed to do? We just don’t do it.
And all of it is wrapped with a plus F, and that’s faith, having faith in yourself, having faith in what you’re doing, and having faith that you will succeed. And so I go through that process with every client I have, Armando. And it’s usually the power of association and their self-confidence that need the most work.
And they go hand in hand because when you have the right people around you, we all have bad days, but you have a bad day, they’re not going to let you stay there. They’re going to lift you up. And it’s so important because entrepreneurship can be very lonely.
If you’re the person at the top, you got to make all the decisions. And so that’s why it’s so important to have that board of advisors, that board of directors, or have that mentor that you can consult and get counsel from because they’ve been where you want to go. You have to be careful who you listen to in this world that we live in.
Armando (22:25 – 23:12)
So I’ve seen, I was watching on your website today, there’s a video, maybe a two minute or so video, and you’re up on stage and the crowds were getting very excited to see you up on stage and to hear your words and you were getting them very motivated and they were very excited. And you could just about feel the energy in that room from them having the interaction with you. And I had to wonder, you mentioned self-confidence, and I had to wonder how much of that is you drawing that, helping them feel that, feel that energy that they have so they can go forward and they can gain more self-confidence.
Sharon (23:13 – 24:31)
Well, that’s one of the reasons that I was voted one of the world’s 12 greatest motivators. But I think you have to, when people feel it and they experience it, they never go back down. It elevates them.
And it’s really, there’s a tremendous lack of self-confidence in the world and we all, the problem is each and every one of us, and everybody you’re watching or you’re listening to this, you were created to be perfectly you. Not me, not Armando, not someone else. Stand in your own power.
Be the CEO of your own life and understand that we tend to judge ourselves through the eyes of others, through the roles we play. And I’d stop it. Stand in your own power, know that you have everything you need to be great success.
And what’s holding you back is usually you. We are usually our own worst enemy because we have the stinking thinking that says, I’m not good enough. Easy for her to say, right?
And so you need to release that scarcity negative thinking and realize that take the right action with the right powers of association and create the right systems in your business. And you can make a huge impact.
Armando (24:32 – 24:40)
Yeah. And an impact not just on themselves, but their families, future generations, their community, they can have an enormous impact. Enormous.
Sharon (24:41 – 25:13)
Yes. I mean, when I did thinking garage for women, the subtitle was create a life of success and significance because a lot of people, they think I don’t want to think about the money. I want to think about the impact and that’s great.
You know, success is not measured by your bank account. Success is measured by how you feel about yourself when you look in the mirror. And, you know, mother Teresa was one of the most successful humans ever on earth and she was broke.
So making an impact on other people is so important.
Armando (25:13 – 25:18)
Right. And I’m just going to hold another book that you wrote, how money works for women. You can see this here.
Sharon (25:19 – 25:22)
Yeah, that’s my most recent, I’m very proud of it.
Armando (25:22 – 25:52)
And, I’ve been going through that and I like how it’s, it’s very, very easy to follow along and understand. It’s not written like an encyclopedia with big words, with a lot of syllables. It’s very visual, very colorful.
And I like what you did in there as well, that you’ve got different ages of women, young career, mid career, older, and from their perspective, what they might be seeing, feeling, or hearing and how they can change things a bit for their own benefit.
Sharon (25:53 – 28:07)
Yes. The only book of its kind, I’m very proud of it. It is all four colors, like a graphic novel.
And we take women from every decade of life from 19 to 86 and talk about the various things that women face. Some men face too, but a lot of the issues they don’t. And so even from college, of course, everybody faces that college at understanding that I’m planning for a wedding, starting a business, and then maybe being married and having to leave an abusive marriage with children and starting over again.
That happens so often. Another one may be being, look, a young woman who has a special needs child. And as a result, she has to change how she does, how she makes money because she needs to be at home with that child.
Another one is been married for 30 years, 25 years, looking forward to golden years in retirement. Her husband comes home and divorces her. That is a huge surprise.
And then she realizes that she never established credit in her own name. That’s a huge issue for women that are baby boomers and even gen Xers, where they gave up control of the money to their husband and they never established credit in their own name. That’s so important for women to understand because women over the next few years, by 2030, women will have inherited and controlled two thirds of America’s wealth.
So with that comes a huge responsibility to understand money, to understand how to invest it, to make it grow so we can preserve it for future generations. And so this book is, I’m just, I am so tickled with it. I’m so proud of it because it addresses those issues and women can say, I’m not alone.
That’s the biggest problem with money. People are afraid to talk about it. They feel like if they’re in financial trouble, they’re the only ones.
And believe me, you’re not. 87% of Americans are stressed out about money. 82% of gen Y, gen Z, which is the highest it’s ever been in history from my perspective.
And so we have to give them the tools, the education for them because the subtitle of the book is take control or lose it because there’s not much in between.
Armando (28:09 – 28:25)
Wow. Well, I’ll make sure to get that to my daughter when she gets back. She’s 20 years old.
Perfect. It’s perfect for her. The good student and she learns a lot and she wants to learn a lot.
So this, this will be helpful for her to see this. And it’s been, I hear back from a lot of young girls.
Sharon (28:25 – 29:43)
In fact, just last night, whenever this airs, but I spoke to a group of young women, the women’s business group at GCU, Grand Canyon University. Oh my gosh. I was so impressed by these young women, but they were all so eager.
They all bought books. They all wanted to hear about money and financial literacy. And it just made me very excited because I see a different generation of young women who are standing in their own power and want to learn about investing in assets.
My favorite word on earth, assets. They love my, my tagline assets are sexy because they are, you know, that’s, that’s what builds wealth. No matter where you live, if you’re a wealthy individual in the world, you either, you have assets, you have multiple streams of income.
And we have taught in school to get a paycheck. And I go, it’s not what you do for your paycheck that determines your financial future. It’s what you do with your paycheck that determines your financial future.
And are you a consumer, which most of us are, or are you an owner? So with every dollar you get, you have that decision to make, am I going to spend it or am I going to invest it and have it work for me?
Armando (29:43 – 30:14)
Are you wondering if you’ve missed anything in your planning? We hear that a lot from very smart, very successful people. And that’s why you may want to know more about our Founders Stress Test.
If so, go to axiom corp.com. Yeah. Interesting.
When I read the, the introduction of, of the, of, you know, how money works for women. And it, it was interesting what you said, that the perspectives are different. And it’s, it’s helped me understand a bit as I, as I read, you know, being, being a man versus being a woman.
Sharon (30:14 – 30:32)
And I, you know, I am not a women’s libber. I, I love working with men, but I think it’s very important for us to understand that we do think differently. You know, men tend to be much more decisive.
Women tend to be better problem solvers, better multitaskers. And so when they come together, you have the best of all worlds.
Armando (30:32 – 31:38)
Yeah. Yeah. Excellent.
So what about teaching kids about financial literacy? Often, often what I’ve heard often from, from people here in my conference room, when we meet with a new client and we’re having those initial conversations is the, the people who we’re meeting with grew up very modestly and now they’re very, they’re very successful because they’ve been working their fingers to the bone for so many years to build a successful company. And they’ve often said that they didn’t grow up with money.
They didn’t grow up being taught anything about financial anything. And they’ve just had to really learn and make focused attention on learning. And what I’ve heard often is they felt like the, the kids who were the rich kids that they were taught some of this by their parents at home, they, they, they had, they heard conversations, they learned going along, whereas the ones who did not grow up in that kind of a family didn’t learn.
So in terms of teaching kids financial literacy, what would you recommend to any parent who’s, who has kids that are growing up and when would they begin having those conversations with their children?
Sharon (31:39 – 33:47)
Well, first of all, you’ve heard the phrase, the rich get richer, the poor get poorer. And that’s we learn it at home. That’s my, one of my biggest arguments that I tell the state board of education, if you want to level the playing field, so every child has equal opportunity, you will teach every child about financial education.
And so it’s very, very important. Now there are a lot of rich kids that don’t understand money and they don’t understand that you need to earn it, right? So there’s, for every instance, we can come up with examples of kids who’ve not learned the right lessons about money.
There are parents out there that grew up very poor and they created great success and they want to make sure their kids have everything that they didn’t. And in the process they spoil them. So the question is, are you a mentor or an enabler with your children?
And so no matter what your background is, you need to start talking about money. And you said, when to start talking, well, what, what age do you think a child knows the difference between a $1 bill and a $20 bill? Three, there are three, maybe four.
And so they know the difference in the buying power. They need to understand the difference in the earning power. And you can do it just by having a conversation.
A lot of parents don’t want to talk to their kids about it because they don’t want their kids to realize that they themselves are financially struggling. And that’s one of the biggest issues we have. So find a resource that can help you.
We created a game called Thrive Time for Teens. It’s a great tool for, it has a lot of humor in it, but it’s great for parents and teens to live to get, you know, learn together about money. But even just taking them to a McDonald’s or to a fast food place and just say, you know, the owner’s not here because they own the business and teenagers are running it because it’s a business and the owner is making money.
And then there’s a different company that makes the, you know, the box that the hamburger comes in. A different company makes the straw. So they just start being aware of the world of business around them.
It’s really important to start having those conversations.
Armando (33:48 – 33:56)
Yeah. And probably the sooner the better because once they get in charge of their own money, their own checkbook, their own paycheck, et cetera.
Sharon (33:57 – 34:11)
And let them make mistakes while they’re still young enough to recover. You know, a lot of parents, their kids don’t have any kind of budgets or money on their own until they’re out in the real world. And then they have no clue what to do and they get themselves in trouble.
Armando (34:14 – 34:36)
Yeah. So what about those, you know, getting back to the business owners who were going to sell and get that big, you know, get that big paycheck. Let’s say they’ve come on board with you.
You’ve been helping them along, helping them secure, protect, and leverage their intellectual property, get all those systems in place to where now they’ve really built a machine. And sometimes I’ll talk with owners when they talk about.
Sharon (34:37 – 36:17)
They want to start entertaining it. Let’s take the time, do our own due diligence to make sure that you got the lipstick on and everything is, paperwork is the way it’s supposed to be. All legal documents are dotted and T’s crossed so that when you do sell, you don’t have a problem with a potential buyer coming in and poking holes in what you’ve done.
And then let’s talk about the type of buyer, right? Let’s go through. We talk about in the book, there’s five different types of buyers.
All right. One is a strategic where I said they might want this territory. Another one is a first-time buyer who’s going to be less educated.
They’re going to probably be reading exit rich so that they ask the right questions when they want to buy something. Another one is a syndication. Somebody that’s rolling up a whole industry.
They just want to add you to the mix. So all these things, these different buyers are looking for something different. And you may be much more valuable to one than you are to another, but in all of it, it’s your life.
You need to say, well, if I sell, what’s going to happen? I have a young man I was working with that spent years. He just sold an incredible concrete cement business, complete with gravel pits.
And he’s got more money than he ever thought he would. And so now he’s faced with, okay, I’ve gone through this process. Now what is the rest of my life going to look like?
How can I make sure that I deploy that money, invest it so that I have the life that I choose? So it’s very important to look at your personal aspect as well as your business aspect.
Armando (36:17 – 37:36)
Right. I’m glad you brought that up. You started with the word of vision.
What do they see? What do they want to see? Then explore the options.
First of all, build the machine so that as the investment bankers have told me, buyers often want to buy a cash printing machine. So if you have all the systems in place, the people in place, et cetera, then it becomes exactly that. It is a machine that cranks out money and that’s what they’re looking to buy.
And it gives that owner then the opportunity to do any of those exits or pretty much any of those exits they might want to at least explore depending on their vision. And we’ll often talk with them about, well, now let’s talk about the rest of your life and what do you want to do? And I often hear people telling me they don’t want to give their kids just a big chunk of money because they don’t want to ruin the kids.
And of course, they’ll be adults well into that time, but they do want to have an impact on their community. They do want to do good things. They feel that they’ve been blessed and that they need to share with the community and with the larger family as well.
And so they want to do good things, but they certainly don’t want to destroy the family by just giving big chunks of money to kids and grandkids who just won’t understand, appreciate, and make good use of those dollars.
Sharon (37:37 – 38:22)
It happens all the time. Blood and money is an issue you got to deal with. And when you have a exit event like this and you have large amounts of money, you want people to set up trusts and do things for their kids.
I never advise making it immediately available to kids. Along with it, you need to create financial education. They might be able to get enough of the trust that matches what they earn on their own.
Some of the ideas I share with people, so that at least the kid, he wants $100,000, he has earned $100,000. So at least he’s showing his ability to make ends meet and to create income for himself. So those are all valid considerations.
Armando (38:23 – 39:00)
Yeah. I heard one say that in his will for his kids, he wanted them to travel. And so he would incentivize them somehow within his estate documents that in order to get something at age 40, they had to have traveled to five countries or something like that.
But to him, the education you get from travel was, there was really no other way to get that kind of education. So he wanted to encourage that and write those into those words, those stipulations into his estate documents.
Sharon (39:01 – 39:48)
Yeah. That’s novel. I like that.
Everybody has different passions and different responsibilities. You may have one child who is married and has five kids and another one is single and wants to see the world. So the issue for you is to understand once you’re gone, how many strings do you still want to have attached to your estate when you’re gone?
And the answer varies. Some people want to be able to control it into future generations, others not. So it’s all personal preference.
But the biggest issue is have the right people addressing the various issues and decisions that you can make so that you make them as you want them to play out.
Armando (39:49 – 40:13)
Right. And it gets back to what you said earlier about having that right team, those right professionals and right team around you relating to exit, but also really even beyond exit, just having the right people around to bounce ideas off of and get the best strategies and thoughts that can help you carry out that vision that you have for you and your family going forward.
Sharon (40:14 – 40:30)
Yeah. So it’s so important. And money can make life so much easier and it can also corrupt it.
So it’s very important to be aware of how you want it to add value to your life and to those around you.
Armando (40:30 – 40:34)
So I am curious, that formula, you said that’s on your website, correct?
Sharon (40:34 – 40:42)
Yeah. PersonalSuccessEquation.com, all one word. Or you can go to my website, SharonLechter.com and you’ll find it there too.
Armando (40:43 – 41:19)
Okay. We’ll make sure to get that in the notes down below so that people can see that and apply it to themselves and begin to ask themselves the questions and hopefully help them get to that next step wherever they would like to go. So Sharon, as you’re thinking about financial literacy, you said that it’s already now mandatory in a certain number of states.
And again, thank you for all the work you’ve done to get that to happen. There’s still a number of states that don’t have that. Are you hearing obstacles as to why that’s not happening or is it just not the highest priority?
Why do you think that is?
Sharon (41:19 – 42:26)
Well, I’m not sure how political your podcast is, so I’ll be very careful how I respond to that. I will tell you wherever I go, parents want it, even the kids want it. Most of the teachers want it.
It’s usually the administrators that want to stop it and teachers unions are against it, which makes sense to me. But it is very important for people to stand up what they believe is important. We teach our kids about condoms in school, but we don’t teach them about money.
It’s just criminal that we’re not teaching kids about the financial world they’re going to face. And now it’s the financial world that they face is even crazier than it was five, ten years ago. And we need to prepare them with the education they need.
And yeah, there’s 25 states. Some will not actually be implemented until like the year 2028, but they’re in process. And I’m very, because a few years ago, it was only six, seven states.
So we are going in the right direction. We just need Arizona to follow that right now.
Armando (42:28 – 42:39)
Yeah. And that is one of the, I’d say, great tragedies in our education system. You can get a PhD in a number of disciplines and never have one class on how to manage your own money.
Sharon (42:39 – 42:48)
That’s right. And there are business school students that never would get taught personal finance. It’s crazy.
Armando (42:49 – 43:25)
Yeah, it really is. It really is. So as you’re, as you’re, you know, we’ve talked quite a bit about, about the business, about building the value in the company.
You you’ve mentioned about the different ways to protect intellectual property and really how to leverage that intellectual property, the brands, the processes. And I imagine a lot of business owners don’t really understand that they have intellectual property that they have created inside their company. So I imagine that sometimes as you’re talking with them, you’re identifying in that conversation and, and helping them see what they didn’t see.
Sharon (43:25 – 44:10)
Yeah. I mean, one of the biggest pieces of intellectual property you have is your database. Anything that you write or disseminate, you know, your business systems, operational manuals, that’s intellectual property.
The way you communicate to your customers or to your suppliers. If you have a system of that, that’s intellectual property. And so, you know, a successful business, every successful business solves a problem and serves a need.
They do. And we have a lot of businesses, we have a lot of problems and needs in the world. But every time within your business, you solve a problem or serve a need on how to make it better.
That’s intellectual property because you’re creating the process of overcoming an obstacle. And that’s valuable.
Armando (44:11 – 44:18)
Yeah. I imagine there’s probably a lot that you uncover in those conversations with those business owners.
Sharon (44:20 – 44:55)
Oh, every time, every time. So that’s one of our first steps is to identify it and then identify how we can increase it. You know, maybe you need to write a book about what you do.
Maybe you need to do something else. Maybe you need to fine tune your operations manuals. Maybe there’s a way, you know, intellectual property.
Think of if you can do something quicker, better, higher quality, with the right, with different resources, all of that is a unique proposition for your company, which is intellectual property.
[Speaker 3] (44:57 – 44:57)
Hmm.
Armando (45:00 – 45:50)
Wow. I’m thinking about that recording I heard of Napoleon Hill. I had some tapes that he made way back when.
And he talked about the Piggly Wiggly stores and how one of the employees went across the street, took the idea and he created the grocery store in a different way. It used to be, you went to the counter, you asked the person in the counter to get me the bread, the eggs, the milk. And he said, no, let’s do away with that.
Let’s let the shoppers go to the stores themselves and pick things off the shelf. And I may be having the right, I might have the wrong name of the store, but it was the same idea, but a different way. And from what you’re describing, that would be, or I guess would have, or could have been at that time, their intellectual property, how they delivered that same consumer good.
Sharon (45:50 – 46:00)
Certainly. Absolutely. Their system, their business system opened up a whole new world of industry within how groceries are purchased.
Armando (46:01 – 46:28)
Amazing. So Sharon, as you, as you’re talking with businesses, are you seeing new things that are happening within the companies? Obviously the economy changes, interest rates change, politics change, but also technology is changing so incredibly fast.
And companies that don’t keep up with it get left behind. So I wonder how much of that you’re seeing in the, in the companies that you might be working with.
Sharon (46:29 – 47:48)
Well, absolutely. And right now the, you know, one of the biggest changing dynamics is AI, artificial intelligence. And it’s, it’s really, it’s, it’s a huge gray area and people are, you know, there are companies out there saying that they’ll write a book for you using AI and you own the copyright.
That is just so not true. Copyright law, you own a copyright on something that you create. It’s the product of your mind.
And so yeah, AI is here to stay. There’s no doubt about it, but AI is not foolproof and you need to make sure that you use, I recommend people using AI for research and then adjust it and make it yours. Put your own words, rearrange it, and make sure that if you were sharing information that you validate that it’s true.
There’s tons of lawsuits going on right now as it relates to AI and its plagiarism or whether information is even true. And so you have to protect yourself. And there are filters that you can run things through to determine if it’s AI.
But if you have third parties working for you doing content, make sure that in part of your agreement with them, if they are not using AI or if they are, they are revising it, making it original content.
Armando (47:49 – 48:01)
Yeah, that makes a lot of sense that it is such a brand new world in terms of what AI does and what it can do. And we don’t even know the full capabilities of that yet. I’m sure we will be surprised.
Sharon (48:02 – 48:04)
And never will because it’s going to continue evolving.
Armando (48:04 – 49:03)
Right, exactly. So Sharon, with the work that you’ve been doing, and again, I think about the core of what you promote is financial literacy. And that work, of course, you’ve seen some progress along the years.
But I guess as you’re talking with the clientele you’re talking with, the people who are maybe they’re in their 40s, maybe their 50s, I’m not sure what what age group you typically see. But I guess enabling them or helping them to be their own, not their own financial literacy advocates, but be their own within their family, maybe the financial literacy person to help spread that word of financial literacy can be a very, very long word, you know, a lot of syllables. But I guess if you were going to define financial literacy, what does that what does that really mean?
And maybe in more, more simple words, more simple terms?
Sharon (49:04 – 50:31)
Well, understanding money, so that you’re a master of your money, not a slave to it, is at the end of the day is financial literacy. So money is a very emotional subject, because most of us were not taught about money. We grew up in households where our parents said money doesn’t grow on trees, pinch your pennies, save for a rainy day, we can’t afford it, all of those comments are negative.
So you grow up hearing money, negative money, negative money, negative. And so no wonder we end up with a scarcity mindset. And it’s in our subconscious.
And unless we address it and release it is always there, you might create some success, but then you’re afraid you’re going to lose it because that scarcity mindset is that depression thinking is still in your brain. And so once you recognize that that’s an issue for you can start educating yourself and release that and shift to an abundance mindset. Instead of saying I can’t afford it, which is a negative statement, you want to use depressing, you want to just turn off the lights.
Instead say how can I afford it? Because when you say I can’t afford it shuts down your brain. When you say how can I afford it, that triggers your entrepreneurial spirit, it triggers your subconscious mind, and your subconscious mind never sleeps.
It’s in there working for you while you’re sleeping. And so you say how can I afford it, all of a sudden you’re gonna start having ideas. And so trigger that entrepreneurial spirit so that you can achieve what you deserve.
Armando (50:32 – 50:59)
And that makes a lot of sense. It also makes me think of asset protection, and liability and the things that you can do to safeguard some of those things that you’ve already acquired. There are trusts, business entities, et cetera, of course, insurance policies you can add to put layers of protection as well.
So that might not get rid of the scarcity mindset, but it certainly can help protect some of that net worth that’s already been built up to this point.
Sharon (50:59 – 51:33)
Well, and it goes back to talking about having the right advisors, the right mentors. The best advisors and mentors educate you. There are many out there that just want you to stay stupid.
They just want you to have to rely on them to make the decisions for you. But the best ones are the ones that educate you as to what your options are, what the choices are, and helps you make the decisions so that you learn along the way. And that elevates your self-confidence and your ability to make strong and prudent financial decisions in the future.
Armando (51:34 – 52:02)
That makes a lot of sense. And it comes back again to what you said before about having the right advisors, the right team around you. And you also said, have people who are your mentors who have been there.
They’ve already walked that path ahead of you. And maybe those people are on your board of directors, board of advisors, or maybe they’re just friends who you know, who you can meet for coffee with every so often, right? To get that knowledge and have that camaraderie with.
Sharon (52:02 – 52:45)
Absolutely. And in my book, Three Feet from Gold, one of the chapters is seek counsel, not advice. Sometimes we’re in the midst of trying to make a decision, and we ask a friend who has no clue.
And we listen to their advice as if it’s prudent. Or we hear somebody talking about something in the elevator, right? Don’t seek advice, seek counsel.
That means finding somebody who is wise in the area you need to make a decision in. Somebody who has been there, done that, and has the education and the experience that they can leverage to help you make a decision that is an appropriate decision based on knowledge and experience, not on opinion.
Armando (52:46 – 53:33)
Yeah, that makes a lot of sense. Well, Sharon, your books are a variety of, you know, a variety of them out there. You know, the Rich Dad books from, I remember reading the Rich Dad, Poor Dad, that’s the only book I’ve ever read nonstop.
I just couldn’t put the book down. I really loved it. But you’ve written so many others since then that are so valuable.
And, you know, I’ve got a couple here on my desk that we’ve talked about as well. And I imagine you’re probably not done writing books, because you seem like a prolific author who just likes to keep, you know, keep your hands in it and doing things. That’s what it seems like you like to do.
And you like to keep sharing your knowledge and sharing your experience, because you know that it comes from a good place of wanting to help people.
Sharon (53:35 – 54:35)
Armando, I tell people when I get mad about something, I start a new company. So when COVID started, I started a new initiative called Daily ATMs, and it’s a play on the bank ATMs, but it’s Daily Abundance Tips and Mentorship. And you can go to my website, it’s on there, atm.sharonlector.com.
And it’s a daily message of positivity, because I was so frustrated with all the negativity around us. And it’s still there. It’s not about COVID now, but it’s about everything else.
And so I just want people to get that dose of positive. And each one I end with the same, you are fabulous, say it with me, I am fabulous. And I just want people to uplift themselves and realize that they have an opportunity, you might not be able to control what’s happening on the global economy, the world economy, country, your state, but you can affect what’s happening in your wallet, you have that power.
And so start making better choices.
Armando (54:36 – 55:12)
Fantastic, Sharon, thank you so much for this conversation. And if somebody wanted to, I saw on your website, you do speak in engagements, obviously. And there is a way on your website where people can get information about that or ask to book you for a speaking engagement that’s on your website.
What website should people go to, to really, to go there or to get a book or to talk with you about possibly asking for your help with their company as they’re making some changes with that? Where should they go to get into contact with you?
Sharon (55:13 – 56:02)
Thank you, Armando. Yes, come to SharonLechter.com, S-H-A-R-O-N-L-E-C-H-T-E-R.com. And through that website, you can find my books, my other online programs.
You can inquire about our mentoring programs. We have a mentoring retreat at our ranch here in Arizona a couple times a year. We also, through that, you can talk about a potential speaking engagement.
So all of those avenues are there. But SharonLechter.com, a lot of free resources. I have a weekly newsletter.
You can sign up, it’s free, where I talk about what’s happening in the world of money. And so sign up for that. And we’d just love to have you all join my community.
I’m also on LinkedIn, Facebook, Instagram. So follow me on social media as well.
Armando (56:02 – 56:17)
Okay, I am curious, Sharon, you’ve done speaking engagements all over the place, obviously. Does one of those stand out as being just your favorite? Or you just remember it because of something that was, it just stuck with you?
Sharon (56:19 – 57:34)
Well, Armando, usually people ask me, what’s my favorite book? But it’s kind of the same answer. It’s like asking me who your favorite child is.
You may have one, but you don’t want to admit it. So I mean, I speak to different groups. Like last night, I love this group of young women.
All right. It was certainly not going to be a moneymaker for me, but it was a heart maker. Just seeing these young women and knowing that the future is going to be wonderful for them because they’re engaged, they’re excited, they want to learn, they want to contribute.
And so that just warms my heart. I work with people all over the world. I just came back from Ireland a few months ago where I spoke to a group of entrepreneurs there and they just, they just love life.
I just love being with them. And my husband was able to travel with me on that and he spoke as well. So every engagement I go to lifts me up.
And so there’s not one that I cherish over another one. I’m going down to the country of Panama in a couple of months to speak to them. In January, I’m asked to come speak to a group of family planners on a cruise in Florida.
So I mean, I just love what I do. It’s not work to me when you love what you do.
Armando (57:35 – 57:54)
Yeah, that’s right. And again, to get more information from you or about you in the inquiries, books, et cetera, Sharonlechter.com, S-H-A-R-O-N-L-E-C-H-T-E-R.com. And that’s where they can go to get additional information.
Sharon, thank you so much for this.
Sharon (57:54 – 58:01)
Oh, it’s my pleasure, Armando. And thank you for all you do because you’re impacting families’ lives for generations with what you do for them.
Armando (58:01 – 58:10)
So thank you. Thank you. It’s the American success story that people have been built and we want to help them keep it.
Good. Sharon, thank you so much. Really appreciate the time.
Sharon (58:10 – 58:11)
My pleasure. Thank you so much.
Armando (58:12 – 58:34)
Hope you enjoyed this episode of the Founder’s Guidepost. Whether exit is on your immediate horizon or maybe 10 years down the road, there’s something here for you. Wondering if you’ve missed anything in your planning?
Schedule your 30-minute Founder’s Strategy Call at axiomcorp.com. And congratulations on your business success. You are the American success story.
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