Being an Outlaw – Alex Prasad

Alex Prasad:
As an entrepreneur, it’s not about you. It’s about the end user. It’s about the other people. I try to spend 90 plus percent of my day in other people’s shoes. What’s their reaction? What’s fair to them? How do we get this deal done? From their perspective? Takes two to tango. If I don’t feel like incentives are aligned, I’m really hesitant to proceed. If you’re doing better, if the partner is doing better, the chance of success goes up exponentially because now they have skin in the game, they’re incentivized to help. Along the same lines, the first part is understanding what’s a win for the other party and then trying to design it so that you can both win.

Alex Prasad:
Otherwise, you’re playing disbegger thy neighbor, right? Pay me money and I’ll do the thing for you.

Dana Robinson:
Exit Plan is a podcast for business owners and those who want to be business owners. I’m always in search of the lesser known stories of entrepreneurship. In the exit Plan podcast, you’ll hear stories from startup to sale and hear from the professionals who helped business owners achieve their exit. Hosted by me, author and private equity manager Dana Robinson, along with my co hosts and guests, you’ll hear real stories, tips, and tools that will help you plan for the exit you want, whether you are still working at a day job or running a business. Let’s get started with this episode of the Exit Plan podcast. Hey, everybody, it’s Dana Robinson coming to you with the Exit Plan podcast. Today, I’m excited to have what I’ll call a member of my special club, the Outlaws, lawyers trying to do non lawyer things like get involved with business. This is Alex Prasad with Aegis Partners law firm specializing in M and A, also at the helm of a turnaround of a SaaS company that we can talk a little bit about.

Dana Robinson:
Alex, thanks for coming on.

Alex Prasad:
Thanks for having me, Dana. Glad to be here. And Outlaw, I don’t think I’ve lots of adjectives thrown in my direction, many positive, some negative, but not outlaw. That’s a new one.

Dana Robinson:
Yeah, thanks. They actually, if anyone’s listening who is an old opt out fan, Nate and I try to. We did a ten podcast run that we never published because Covid hit where we interviewed only lawyers who were trying to leave or had left or had an alternative approach to the practice. So they’re sitting and waiting and we had quite a few interesting stories. And so I want to get to what your law practice is and does because I think the model lends itself to entrepreneurial lawyers. So anyone who’s listening, who is a lawyer and in that club will be interested in the business model of the firm. But let’s go. Before you were a lawyer, did you have an ambition to be a business person? Did you just wake up and say, I want to be a lawyer? Did you go to college? And then someone said, well, lawyers make a lot of money.

Dana Robinson:
How did you end up. How’d you end up being a lawyer?

Alex Prasad:
It’s funny when you tell the story after the fact, everyone has, like, an inclination, right? To create a narrative, as if, like, every step led to the next step. And it was kind of intelligent design, but really, life’s like, you know, visceral reactions to whatever pops into your face. I mean, there’s a little bit of a plan, but, yeah, I went to Michigan undergrad. Go blue. Nice to be a national champion. I say that after many decades of heartache. I grew up in metro Detroit. So that’s a proud moment.

Alex Prasad:
And I went to Michigan and I was in student tv, and that was the career. I did live tv stuff first, and as a kid, we had student tv and radio in high school, which is unbelievable. I always thought that was the thing. Did it in college, did it for Big Ten Network, which was super fun, exciting time to be there. You sound like a dinosaur. Technology moved so fast. We can stream video over the Internet. That was a big deal.

Alex Prasad:
We didn’t need satellite trucks. That’s why you can get all these non revenue sports. They call them olympic sports. But I can say non revenue now that I’m outside the business on tv is because you can stream it. You didn’t need a satellite truck. It was a huge. I wasn’t the engineer. I was producing, but that was the breakthrough moment for big ten network.

Alex Prasad:
We really kind of proved out that model. And now, unfortunately, announcers aren’t even on location. This is a very long story, Dana.

Dana Robinson:
Oh, yeah, I thought about that. Yeah.

Alex Prasad:
That was the initial technology, right? I mean, today you’re watching 4K on your phone, mowing the lawn. Yeah, it’s crazy, right? But that’s where we were 20 years ago or whatever, 15 years ago. But I got bored intellectually, and so, I don’t know, I’m a big reader, and it seemed to be a common pattern that many people who had achieved, I’ll say interesting things, good, bad, or otherwise, not for me to judge, had a JD, and actually now I’m lucky to, with the Ross School of business at Michigan and some other entities try to kind of give back in a mentorship sort of role, sporadically. Good. And I’m a big. I think the JD is what maybe a liberal arts degree was 30, 40 years ago in terms of its rigor and the intellectual challenge. So it was a great experience. Law school was, for sure.

Alex Prasad:
And then. Yeah, then I became an outlaw, so maybe more to come on that part. But the law school experience was, you know, fantastic. It was intellectually stimulating. It was intellectually honest. Right. And you just get eviscerated because you didn’t read or you read the wrong thing or you didn’t understand it. Right.

Alex Prasad:
But that was fun to be, and I really, really enjoyed my time at Notre Dame is where I got.

Dana Robinson:
Yeah, I did law school as a safety. I was raised by, you know, a blue collar family and no idea what to do after college. With college. And I wanted a secular. I was. Long story. I was in ministry. I had two degrees in theology and wanted a secular degree, although I had owned two businesses.

Dana Robinson:
So I was like an entrepreneur. But I just couldn’t imagine that I could be a success because I felt inadequate. And I went into law school with the main goal, to extract all the knowledge that I can. I mean, it was wildly expensive, and I was there to learn and to take away everything I could. And you’re right. Like, I had studied in college and grad school, the classics. I’d studied the Socratic method, and not as a mean way to grill law students, but actually as a sort of epistemological problem solved with an approach to learning. So I had the same kind of rich, deep experience in law school, and I’ve been back for ten years teaching adjunct at both of our law schools to try to give back to that as well.

Dana Robinson:
But, yeah, a lot of people ask me, should I go to law school if I’m not going to be a lawyer? And unfortunately, I give them that same lecture, like, I wouldn’t give it up, even though I spent most of my legal career trying not to be a lawyer. But it’s so expensive to get that level of education that if you don’t go practice, it’s so challenging to get a career that uses the JD that gets you the economics to pay back that investment.

Alex Prasad:
Yeah, that’s a real unfortunate. So, one of my best mentors, I’ve been so lucky over the years, really, really good mentors. One of them was the dean of Tennessee law school where I started, and he said. Actually was talking to him maybe four or five months ago, said, alex, I’ve never had a law student show up on the first day when they asked, why do you want to be a lawyer? That say that they didn’t want to be a lawyer. So you were the first. I said, man, that sounds like I was a real picker for a letter word.

Dana Robinson:
You’re a little like, I don’t need this. I’m in here for fun.

Alex Prasad:
Right? Like, I’m sure, like, what impression did that leave man to a little perspective, you know, wiser years. Right? But it was true. It was genuine. And, yeah, I think you’re right. Absolutely. That’s the same conversation I have when someone says, should I go to law school? I go, well, the skills, I mean, you’re going to completely rewire your brain.

Dana Robinson:
Yeah.

Alex Prasad:
Think completely differently, in a good way. I think it’d be way more analytical, maybe a little more cynical, but way more analytical. But you’re right. The economics, though. I know what the starting salary is at my firm when I started ten plus years ago, eleven years ago now, and it’s like double what it was. That seems. I mean, inflation, but I could do the 10% a year. I don’t know.

Alex Prasad:
So anyway. But, yeah, it’s hard. You have to. It’s a really fixed course, being married to a doctor, which is a very rigid career path. Like you miss by a week on vacation, and then you’ve missed a whole year cycle of who gets higher. Crazy stuff like that. Right. I mean, for the law path, you don’t get that summer associateship, right between two and three all year.

Alex Prasad:
You’re like, off kilter. Yeah, for years. They have really smart, good friends that were off kilter in the first three years of their career. It’s not in the wilderness, but, you know, it took them a couple years to get into the lateral position, to then get to the place because they just missed swim lanes. Right. Just missed the boat on the right timing at the outset. Nothing they did wrong. So, yeah, it’s kind of rigid from that perspective.

Dana Robinson:
All right, so let’s get to the more exciting part. How do you get out of practice? How do you escape the demand that you must be in practice in your career path? I mean, people listen, probably know mine, but more interested in, you know, you’re still practicing and your practice actually does things in business that you do as a business person. So m and a practice. But what was the thing that dragged you out of law to become an entrepreneur and a business person?

Alex Prasad:
Yeah, that’s a good question. So I stepped off. This is like kind of chicken and egg thing, right? Like, you want to take an entrepreneurial leap. How do you do it? And very rarely, but at times, we’ll talk a little firm’s model, but the producers and originators will talk about who these people are, but the producers get a little bit agitated sometimes the originators are originating work and making a percentage, basically. And I’ve only had to do this once, said, I can send you my 2018 tax return. You can see $28,000 of income, right? So I stepped off the moving walkway without a plan. Didn’t go well, by the way, but I took a risk, and I saved at least something, so that wasn’t devastating. It could still stay in my apartment, etcetera.

Alex Prasad:
And my wife was in medical school, and so we knew long term we were probably going to be okay. So let’s be realistic about what a real risk is in the context of, you know, living in the United States of America. You can just get a job, it’ll be fine. So I just took the leap because I was just unhappy. And I just knew, in retrospect, I should have been not as unhappy. It was a learning experience, but older, wiser. But I kind of knew the same 20 was going to be sitting in certain hours, Monday through Friday, minimum, maybe later, maybe weekends, for forever. And I looked up the pyramid and said, if that’s the pinnacle, I don’t want that either.

Alex Prasad:
So I just need to get some perspective and try to figure out what’s next. So I spent a lot of time, a big runner, a big athlete, just like, networking in the sports and sports technology universe, which, again, in retrospect, maybe not the best industry, but regardless, you know, sports. I mean, it worked in tv, right? So it was, you know, organic, if you will, without a call to action, without a real ask. I was just trying to explore and learn and meet people. So I just took the leap. Kind of a naked bet that I would figure it out. But I had been there before in tv. We had started a thing at the University of Michigan.

Alex Prasad:
I had Bruce made, who was a guy that was in Michigan for 40 plus years, king of his mountain, if you will. Come to me one day and say, we’re getting all this equipment from Big Ten Network, we don’t know what to do with it. I said, oh, well, we’ll use it. We’ll figure it out. As students, we didn’t have an academic program. We were doing all this tv stuff for free. And they said, well, we need to do six games this spring, and said, why don’t we do all of them? And I walked out and said, oh, I guess we’re going to do all these games. Went back to my friends at the student tv station and said, hey, we’re doing 28 baseball and softball games.

Alex Prasad:
We’ve never done that before. I’m like, neither have I. We’ll figure it out. And we ended up winning an award the following year for best in the big ten, even though we had no full time employees doing it. So I guess I already had it ingratiated that I was kind of a fool, would displace naked bets in myself over and over again.

Dana Robinson:
Let me interrupt you because there’s actually this thing that I learned. It has a label in the world of psychology called self efficacy. So the ability to be confident and self regulated right now in the face of the unknown thing that I’m going to do tomorrow, if I’m going to go on stage tomorrow and I don’t have an increase in my heart rate today, it’s because I have this thing called self efficacy. I know that when I stand up there I will be okay. So I think there’s a lesson in the, you learned an entrepreneurial lesson at low cost and almost no cost. Of course you had to work for free or whatever they were paying you on the work study program, but you got to take entrepreneurial risk and learn the risk reward payout cycle. And then later in life you go, I’m gonna make a move. And then your brain automatically goes back to, okay, I’ve experienced this before and I think I can, I think I can do this.

Alex Prasad:
I wish, I wish I had thought of that at the time. I think it was a lot dumber than what you described, but maybe that’s what I was doing subconsciously. I don’t think it was conscious. It was, it was more, again, this is, I think I’m genuine when I say like it’s more a reaction to the stimulus in the mo. I was very unhappy in that other setting and it just got to the point where like I don’t, I just don’t want this to be my life. Right. And that’s by the way really into stoicism now, et cetera. That was mostly in my head.

Alex Prasad:
I mean may sure an environment that wasn’t younger, dumber, you know, you figure it out later. Right. But that was mostly in my head. I could have a different reaction to some of these stimulus, if you will, that stimuli that was not ideal or whatever the right, you know, adjective is, but I didn’t. But I think there was some creative destruction that came with, I guess leaving. So I was in the wilderness for a little bit, but then I did find the firm that I’m in now. And I started first as a producer, as in the lawyer, billing the time and doing the work. And again, great mentor, the founder of this firm, Scott Levine, based in St.

Alex Prasad:
Louis, who’s a lawyer who doesn’t want to be a lawyer. He started a venture capital firm that’s very successful in St. Louis alongside this law firm, but still operates the law firm. And I had a. A meeting with him very early on where I guess I’ll say, he identified in me this thing that maybe you identified hearing the story. And, I mean, the word is leverage, right? And he said, look, there are way more lawyers who can do the work than lawyers who can win the work because. And I’ll make fun of you with meek since we’re in the same boat, right? We’re boring. We’re robotic.

Alex Prasad:
It’s formulaic, right? It is a general rule, a transactional lawyer in particular. That’s the personality. That’s the mindset. Very few are the deal maker type. They gravitated to MBA or BBA, and they’re doing other things, maybe kind of things like you’re doing now, Dana. And so Scott would call me every month, and you look at the origination, and he look at the production, and if I worked too much, he’d say, what are you doing? As in build too much time. I said, what do you mean, what am I doing? I made more money this month because I worked more. He said, stop working.

Alex Prasad:
Start winning work. And, like, getting that message repeatedly really sunk in. And so, in fact, we had a firm retreat at the beginning of this year, the first one in years, Covid, et cetera. Right. And, yeah, I was a little bit of a outside of body experience, but he asked me to speak just for two minutes. Right. But on my strategy in business development. And it’s about leverage, as in, for every ounce of energy you put in.

Alex Prasad:
And I know this resonates with you and your entrepreneurial activities. How much can you possibly get out of it? Like, you can read about restaurant. I mean, I’m not a restaurant guy, but, like, the margins are single digits, man, what a tough business. Like nights and weekends. That was my tv phase. One of the reasons I left, you know, eke out 5%. If you’re, like, best in class. No, thanks.

Alex Prasad:
I mean, interesting, fun, maybe, but from, again, that leverage perspective. So leverage is the word that’s always in my head in an operational setting. And it’s maybe I took the question beyond its scope. Right. Or in the legal setting. How much can I, you know, can I out kick my coverage here on this investment in this whatever and less naked bets. Got kids, family, older. Right.

Alex Prasad:
So that phase hopefully is over. But that’s really what I’m thinking about every day. What am I, a blocker on so I can leverage my employees. That likes a lot of add, by the way, because way too many incoming messages. Right. But I’m trying to remove the blockers kind of free that resource to go the highest and best production. And then when we think about opportunities, what’s the maximum possible outcome that we could get? Let’s rank order by, again, not irresponsible. And risk reward, I mean, there’s a combination, but we should probably pursue the lowest energy, highest output items on our list because it frees you up to get outsized returns for your effort as opposed to trading your time for money.

Alex Prasad:
Yeah.

Dana Robinson:
Yeah. So the, you made a couple observations that I’ll draw out. There’s a, there’s a book I saw recently called I think it’s a kiyosaki book. A students work for c students. It’s been, it’s been a mantra for a long time. I’m not sure it’s totally accurate, but the, you know, it and you know, I love the, the transactional lawyers, for example, who, who are employees. I think people who like being employees, which is most people make, you know, from the legal training standpoint, you’re legally trained. You’re in that 20 by 20 office or twelve by twelve or now they’re six by six.

Dana Robinson:
Probably the, you’re in this, you’re in this little office and you’re doing something that you flourish in and are doing great. But the, those who, you know, like, I like, I liked drafting contracts for a season of life, but there’s a certain point where your eyes just bleed. Looking at 80 pages of single spaced contract language and moving stuff around, the ability to step above that is something that you have to have real intent around, don’t you think? I mean, you had a mentor. Literally have to snap you out of the fact that working more hours is not going to make you more money. You know, what are some looking at the law firm you were in? Someone who’s listening to this going like, I got to get out of this place, guys. What’s the tool? How are they going to, how do they get where Alex is?

Alex Prasad:
Oh, man. I mean, I don’t know if it, right. I mean, if you don’t have the desire to constantly improve. So I’m never satisfied. Right. It’s part of the personality, good, bad or otherwise. And I don’t know if it’s above. It’s just different.

Alex Prasad:
Right? That quibble. We can, we can go, we can go 80 pages, single spaced if you want, but that’s not true. I’ve done some personality tests since, whatever. You start to understand that, like, okay, capable of doing that, attention to detail. Capable of doing it, but not genuine to where you really thrive. Like, oh, that’s why it’s demoralizing to be at the office at midnight doing the 80 page single space, but not to be on a call. Interesting business opportunity. I’ll do that all day.

Alex Prasad:
I mean, I won’t because kids, et cetera. But from what turns your crank perspective? I’m much more interested the latter than the former. I don’t know. I think for me, there’s a gating question, which is we would hit every year, which is, wow, okay, I know how many hours I’ve worked, I know how many hours I’ve billed, and I know what the bonus structure looks like. It doesn’t pay to keep working in a real politics sort of way. Like if I just do the math, doesn’t pay. I could go work at McDonald’s. I’m going to make more like that extra $2,000 bonus or whatever for another however many hundred hours it doesn’t work.

Dana Robinson:
Yeah.

Alex Prasad:
And when you think about a salary, and look, there’s also other inputs, right? It’s super clear, right? Like the consistency of knowing you get a paycheck every two weeks and your life circumstances you need to provide for. Kid resonates with me more now in different life stage, etcetera. So it’s not to poo poo that, because 99% of people are in that boat. But if it like, just grates on you and know this burns you that working harder actually means you get a worse return, then you’re already 90% of the way there. And it’s just a matter of whether you can tolerate something that’s eating away at your soul every day or not. Some people can issue, I can’t. But you have to have that first. And it’s not unfair.

Alex Prasad:
It’s a trade of the certainty. And that’s why leaders, when you have to remove people from work, it is a heart wrenching, it’s a hard thing to do. You know, it’s the right thing to do for the organization. But you’ve made this trade. There’s an implicit contract if you will, that I’m trading certainty. Right. You get certainty as an employee. That’s salary.

Alex Prasad:
And I get the potential upside. We can get out of you, or the margin, or I’m giving you the tools, you’re going to leverage them into more value. Right. For ship. Like, that’s there. People don’t talk about it, but it’s there.

Dana Robinson:
Yeah.

Alex Prasad:
And that’s a fair trade, I think. But some people just uniformly reject that. So, sorry, that’s the first step. Like, does that bother you or not? If it doesn’t bother you, you’re not going to make the leap because you don’t have a fundamental problem. And that’s fine, by the way. Right. With the setup. If it does, it’s a whole different.

Alex Prasad:
Dodge. Your question by saying, first, yeah.

Dana Robinson:
No, no. You answered the question of what I’ll call shelf life. There’s a point at which, you know, you can’t do this anymore. And at that point, you really have to start listening, learning, and thinking about, how do I escape this? And it’s one of the biggest themes of the podcast over the years that my podcast partner and I have drawn out that we didn’t really know it was a theme until we had interviewed 100 people. Most successful entrepreneurs launched into something that they got from a job, and very often they were at the end of that shelf life where they’re like, I got to get out of here. Right. But they took the skills, they took their network, they took the relationship capital, and not always even realizing that they had earned and accumulated sort of this bank of capital that they could deploy that was non financial capital that gave them what they needed to become self employed as a lawyer. Right.

Dana Robinson:
No one’s going to hire you if you just go out of law school and figure it out from the books. Right. So how much for you, of the experience of the law firm? Is there a point where you go like, oh, I’m good at this because I learned a bunch of this at that job that was sucking the soul out of me.

Alex Prasad:
Oh, 100%. Yeah. Super critical learnings. I remember being in seminars early on about business development. I don’t even know how to do this stuff. I don’t know what the signature page is or where it goes. I’m so far beyond being able to talk credibly to someone and win the business, but it is a learned thing, and that’s actually, I write in my blog that my mom reads in three other people on a weekly basis. But I’m enjoying it just because it’s a meditative, almost like I’m working out the thoughts in writing.

Alex Prasad:
You may be similar, Dana, but I think a lot better writing, even if it’s for no one else. But, yeah. One of the signs of a good lawyer, in my opinion, is when an issue arises, not good experience, they’re going to add value. They got stories. It’s not so much I understand it because actually, you can miss a forest from the trees a lot by understanding something too deeply. But it’s more. I’ve seen it ten times, eight times. This path worked out better than the other path.

Alex Prasad:
You’re choosing the worst path in quote. Right. Doesn’t mean we can’t go down that path. It’s not the lawyer’s job to tell you no. The lawyer’s job is to give you that context around the decision point, whatever. It is. So easy one earn out, right? Pe guys, evil pe guys like Dana are going to love earnouts because they’re not sure and they want to lower price cash out of pocket at the outset. And we’ll see what happens.

Alex Prasad:
But if you’re advising sell sides, you better be happy with the deal without the earn out. If you’re happy at that level and the earnouts, gravy. Great. Perfect scenario. Go for it. Hope it works out. But don’t count on it if you like. We’re bridging this gap of it was sufficient with the earn out.

Alex Prasad:
Just ask yourself, why would a buyer pay you more money for something they already bought? Well, because a piece of paper says so. Okay, great. But just know that we’re in, like, a scouts honor, you know, phase now of this agreement. Not because it just does not make. From a pure self interest perspective, it does not make sense. They are incentivized to fight about this with you later. It doesn’t matter how well we drafted, etcetera. You say all those things, they go, I’m gonna be really unhappy if I don’t get to earn out.

Alex Prasad:
But we’re gonna do it anyway. You go, okay, I said my piece, right? I told you some stories about when it works out and when it doesn’t. Your choice, client. Right? As to whether to go with it or not. So that experience matters. So I saw a lot of, you know, I say I only use the word fun in an ironic way now it seems, but like, a lot of fun things that, you know, completely ruined my weeks and months of my life, right? But they were great experiences, you know, share them at, you know, a high level, but all sorts of stuff, you know, train wrecks. You know, smooth deals, train wrecks. Oh, yeah, deals that looked great, but it was a bunch of off the balance sheet debt.

Alex Prasad:
So, in fact, the other founders came out, you know, behind, even though everyone thought it was a bit, you know, like, all sorts of stuff. And these are all things you.

Dana Robinson:
You learned all this stuff at a job, and you get to, you get now to come into your client’s life and make exceedingly more than you made as an associate at a firm, and you’re leveraging all this knowledge that started. So I’m saying it just to draw it out to encourage listeners. If you’re at a job you hate, don’t leave yet. You got to step back and ask, have I extracted everything I can out of this?

Alex Prasad:
Yeah. The balance of extracting as much as you can and waking up every day and being sure that you keep, have the will to live and doing that. Right.

Dana Robinson:
Yeah. As you said, you can’t do it anymore. Right. And we can’t do any more than you have gotten everything you can out of it. Now it’s time to step out. And in many cases, stepping out for you is into the law practice, but with a completely different angle. Right. And, you know, entrepreneurial practice, I doubt you would take clients when you left.

Dana Robinson:
You know, if you leave a big firm and, yeah, no, join a group like this, you’re starting from the ground up, and all you’ve got is your bootstraps. Dana Robinson here. Quick plug for my book, the king’s fly swatter. You can see it here behind me. If you’re watching this, I’ve got it in my hand. It’s a beautiful hardcover book, printed to make it giftable, something that you can share with a family member buy as a gift. So this latest book, it’s a fable about a person who has a really crappy job. Let’s just start there.

Dana Robinson:
This is a book that most people can relate to because we’ve all had crappy jobs. This is the story of Ubar, a servant in the court of a babylonian king who masters his boring, monotonous job and then learns to listen to the king, hearing him rule the kingdom while quietly swatting flies behind a cane. Eventually, Ubar becomes the wisest and most successful man in the kingdom. The story is fun, and it’s easy to read, but it’s not mythology. It’s my story. And as I shared the idea with colleagues and friends, I learned that it was their story. And guess what? It’s your story. If you’re at a job of any kind, one that you love, one that you hate, one that’s just enough to get by.

Dana Robinson:
This little book gives fresh perspective on how to leverage that job to get you something greater than a paycheck. The lessons in this parable are entrepreneurial lessons, but not what you might think from the current entrepreneurial zeitgeist. If you or someone you know are looking for a real pathway to entrepreneurship, here’s the secret. Your job is the way out of your job. It’s counterintuitive, but once you see how it works, you can’t unsee it. Learn the way of the fly swatter from the parable of Ubar and from the stories I share from my 30 year business journey. You can get a free copy of the Kings of Lieswater by going to danarobinson.com dot.

Alex Prasad:
Yeah, I mean, our firm is great. All pricing is transparent between the attorneys and with the client. Right. It’s all commission based. So it’s a. Honest is the word. Which has not to mean that the other model is dishonest. Right.

Alex Prasad:
But it’s just transparent. So at my firm, we know on every deal, I remember doing the first deal as more of a producer and billing the time with a partner. I know how much the partner made, how much she made. I know how much I made on the deal. I knew how much the house made. And you go, oh, that’s kind of cool. There’s just complete transparency here. So, yeah, at our firm, no one has a salary, and everyone’s working on a commission basis.

Alex Prasad:
So just starting there, we’re very aligned with clients. If there’s a, you know, runaway bill, the person that worries first is the originator. So I have to go. So, I mean, there’s positives and negatives, right. In. In some ways, I wish I was in the old model, because I guess tell people to do stuff and they would do it. I can’t tell anyone to do anything, which is, you know, again, it’s a good thing. It’s a healthy thing.

Alex Prasad:
But I have to, like, you know, whip votes. Basically, I have to plead with people. Hey, will you work on this project? Oh, that’s a client didn’t pay their bill last time. Well, guess what? They’re not interested in working with the client again. Right. Understandably so. It’s a really healthy dynamic, and it is entrepreneurial because we’re going to take some bets we’ve been able to do. I remember, again, no standing, right.

Alex Prasad:
I had three clients, or whatever, minimal, joining the firm. And I told Scott, our founder, my only rule like, if I said I could have rules coming in with $50,000 of business or whatever, it’s like I want to be able to treat and bill my clients the way I want to do it. Yeah, no problem. That’s the way it works here. So we’ve done a lot of creative things with flat fees, etcetera, but I just have, my only rule, if you will now is we always communicate upfront to the client an expectation. You can base a retainer based on that, by the way. So that’s maybe to our advantage, but it keeps all of us aligned. And as soon as I had a call yesterday with one of my producers to go, whoa, this got out of in like three weeks time or whatever, this bill is a lot bigger than we thought.

Alex Prasad:
We had a conversation about it. Well, here’s why. And I’m kind of learning so we can write that part. It was productive. Right. Okay, well, I’m checking in not because I’m worried about the client, whatever, because we’re not going to. This isn’t going to make it to the client. We’re going to find a way to stay in line with expectations.

Alex Prasad:
But your expectation, is this a fair shake for you? Because if it’s not, you’re not going to work with me again. I need to find other people to do the work and so on and so forth. That’s been in the legal lane. A way to scratch the entrepreneurial itch, I think, to align those things upfront to have the freedom of flexibility to, you know, I don’t know, be adults. Right. With our clients and amongst ourselves and just kind of work it out.

Dana Robinson:
Yeah.

Alex Prasad:
Very different approach than traditional firm.

Dana Robinson:
Yeah, yeah, I love it. I mean, and I experimented with two different forms of sort of hybrid. We did a cost sharing firm called Tech law that grew to 14 lawyers and made us the second largest IP boutique in San Diego. But it was a horrible model because there was no house and someone needs to be the adult in the room. So we dissolved that one after we had a partner with some health issues retire. And then I formed a similar, but a little bit more structured and a little bit transparent, like you’re talking about with four partners that became USIP attorneys after that. And then I sold my interest to my junior partner and spent the last four and a half years doing private equity, blue collar business work. I’m interested in how you landed in the, in the sort of corporate role that you’re at.

Dana Robinson:
Was that a client of the firm? Like, talk us through the. I want to, I’ll come back to the firm and sort of the stuff, you know, as a lawyer, that’s going to help our listeners around transactions and m and a. So I’ll get your legal input, as it were, as a professional, around deals and transactions. Before we finish, but let’s divert just for a minute, because I know you’re at the helm of a turnaround, and I’d love to get that story, because that’s a. There’s a bunch of lawyers that want to do what you’re doing there. They literally wanted something in business, and they’ve seen all their clients do things, and they’re like, when do I get my shot? How did this all come together?

Alex Prasad:
Yeah, yeah. Come together is maybe an interesting characterization of all the events, but, yeah, it’s been a roller coaster for sure. I’ve learned a lot. I’ve grown a lot. To give you the short story long, I do think that there’s a pattern that we talked about a little bit. Right. The self efficacy thing. So I’m a big runner.

Alex Prasad:
So I think my first life success was running in high school and being not bad at it. I think that translated to the tv thing, and there’s nothing. Our employees today probably hate that I have this experience, because I’ll use the metaphors all the time. Like, the centerfield camera went out and first pitches in five minutes, and we’re not starting, you know, the effin show without a centerfield camera. Right. So somehow, like, we’re gonna figure it out. And you talk about, you know, blue collar business. You know, the tv crew is not a whole bunch of, you know, pointy headed individuals.

Alex Prasad:
Like, we’re gonna find the way. That doesn’t matter. We’re gonna. The backup camera, we’re gonna run it out there, right? We’re gonna, you know, shuck and jive and do something to distract from the fact that we don’t have it for the first. Like, we’re gonna solve this problem in five minutes, and we’re gonna be a team and do it. So one of the patterns, like, the journalism route, I was like, why am I just talking about what other people think did? And I did the lawyer thing, and, like, why am I just helping other people do stuff? I want to do stuff. Maybe some youth in that, and in retrospect, like, doing those things maybe. Probably, you know, just fine.

Alex Prasad:
Thank you. So I always wanted to operate again. I’m a bookworm. I try to consume everything I can, and I don’t think I. Maybe there’s some hubris, right? You know, mix in there. Like, I can do it, like no problem, but I wanted to do it. The whole Teddy Roosevelt demand in the arena kind of concept, right? Yeah, I have the little like short, whatever, 15 page book or whatever on my bookshelf. So yeah, it was a client of the firm, one of my clients, they had the opportunity to start to operate and the company was kind of flat for a really long time.

Alex Prasad:
It made the market in sending video over the Internet. Totally random coincidence to that tv experience. Totally random. And also in my hometown, totally random. I had no idea it was in my hometown until this opportunity arose. I’m in metro Detroit. Novi is the name of the town. But yeah, I had the opportunity to come in and operate and then eventually we raised some money and we started to turn things around.

Alex Prasad:
And now I’m in the CEO seat and we’re launching a new product here on May 13. And we recently sent out a survey to our existing customers. We have roughly 30% of the market amongst golf instructors on the b two b side of the business, but it’s not extremely lucrative. I’ll just leave it at that. And that has been a problem. There’s pricing issues, there’s all sorts of fun, kind of twisted pretzels to untwist. We sent a survey out with the new product and what it does, and there’s the higher price tag for delivering more value. And in the first 24 hours after sending a note out with a survey, 128 people accounts filled it out and 103 wanted these higher value products.

Alex Prasad:
That was a great. So we’re very excited and it’s because we listened to our customers. I can’t stress enough. I mean, like one of my biggest learnings. You didn’t ask, but I’m just going to tell you anyway, Dan, right. No one cares what you think as a lawyer, as an entrepreneur, it’s not about you, it’s about the end user. Right. It’s about the other people.

Alex Prasad:
And I spend, I try to spend 90 plus percent of my day in other people’s shoes, right. What’s their reaction? What’s fair to them? How do we get this deal done? From their perspective, that translates to the lawyer thing too. That like, yeah, the deal’s about you because you want to get it done, but it takes two to tango. If you’re not spending most of your time, you’ll always remember what you want. You’re not going to lose track. Like, you’re not going to lose track. But if you lose track of the incentives right around, we do all sorts of in the entrepreneurial setting. And I advise clients they can take the advice or not.

Alex Prasad:
But if I don’t feel like incentives are aligned, I’m really hesitant to proceed even to the point of dealing someone in at a low level. You’re not going to mess the economics up to the point where you’re losing, right. But, like, if you’re doing better, if the partner is doing better, the chance of success goes up, you know, exponentially, because now they have skin in the game, they’re incentivized to help. Along the same lines, the first part is understanding what’s a win for the other party and then trying to design it so that you can both win. Otherwise, you’re playing disbegger thy neighbor. Pay me money and I’ll do the thing for you. Well, if there’s not a way for me to make more, maybe there’s a constant theme here, too. By you doing better, what’s my incentive for you to do better? I’ll just take your money.

Alex Prasad:
Really? Any deal? Any deal. Again, in the entrepreneurial lane, in the lawyer lane, I’m always trying to figure out what is the win for the other side, because we can define that. We can decide whether we can grant the victory to them with or without interrupting our goals. A lot of times you can give them what they want and you don’t even care. Like it’s not even important to you, right? But without a clear understanding of that, you can’t get it. People be coy, they won’t be honest. They won’t be transparent, whatever, right? You can’t, you know, deal with that the best you can. But if you don’t get to that point, the spidey senses are always tingling till the last minute because you don’t really understand why people are doing what they’re doing is to take people at face value, right? They could be, you know, evil geniuses and hoodwinking you.

Alex Prasad:
But that’s so critical.

Dana Robinson:
Love it. The, you think in this role that you’re in, how much of the. Let me just stop and say. A lot of people think that when I bring a lawyer into the business, they’re going to fix things, because them lawyers, they’re always keeping an eye on risks or they know how to x, Y and z. But as I listen to what you’re talking about, that you’re flexing on the things you’ve learned from seeing hundreds of deals. Your understanding of deals is sort of refined business psychology in some ways, and it has nothing to do with you. Your legal training, in a sense, making you better at risk management or whatever people think when they throw lawyers into management. The greater skill here is the soft skill you get from being around so many deals, isn’t it?

Alex Prasad:
Yeah, it’s about reps. I mean, that was when I was placed in a practice group. I wanted to be in the transactional group because I would just see more movies. Right. And then you can pattern match against them longer term. So that was a conscious choice that I made. So I’ll give myself, you know, partial credit on that one at least. The rest, maybe is just all your reaction, but that one was purposeful.

Alex Prasad:
I mean, you want to, if you can’t be the starting quarterback, you want to be the backup quarterback, and you want to do every, you know, walk through every rep possible, watch every rep get in on the second t and the scout team, you know, pretend to be different quarterbacks. Sorry. You know, comfortable football, like college football fan. Right. You know, pretend to be different types of quarterbacks, different assistant that’s building a data bank to draw on later. Yeah, I think whether people realize it or not. And lawyers you do because everything’s by analogy. Right? Reason by analogy.

Alex Prasad:
Is it like this case? Is it not like this case and, man, cases I haven’t thought about a case in forever. It’s transactional. But like this deal, is it not like this deal? Right. So you’re trained to think. So there is a conscious thing going on for the attorney or the person with the law school. But I think that’s kind of how everyone acts anyway in reaction to anything. Have I seen this before? What is this most like that I have seen previously? It’s not. A little bit maybe.

Alex Prasad:
Like, what stories have I read? Sure. Like second, you know, on the list, if you will. But first is, what have I experienced firsthand? So, yeah, at risk is so funny. You made the A student C student comment earlier, but I mean, that’s one of the. Besides the whole, like, you don’t matter learning in entrepreneurship, it’s what other people think about and care about matters, and you have very, very little input there. The next thing is good enough. Defining good enough is so super important because if you over bake something in business, you’ve wasted time, effort and energy just as bad as under baking it. Right.

Alex Prasad:
Like not getting the job done. That’s definitely a lawyer, you know, risk. Right. Or the risk of a lawyer operating, for sure. So maybe I’m a really bad lawyer, or maybe, I don’t know. It’s hard to be both. But yeah, but that’s like the good enough, you know, how much more? What prize are we going to win? I ask all the time what prize we win by doing it that way. There’s a good answer, don’t get me wrong, but if we can, as a SaaS person, it’s software as a service.

Alex Prasad:
But it starts with a service, it’s turned into software, and then it’s delivered back as a service. And so, like, from our feature. And I don’t want to declare victory on one survey result. Right. And we’ll hopefully see the financial gains. Really good green trees of grass here. So I’m glad we’re talking now and not even three weeks ago, but we built, we call them hamster wheels. That my director of sales said, never use hamster wheel with an outside part.

Alex Prasad:
Like, yeah, fair enough. That sounds bad. Like, what will the hamster wheel for you? He’s like, no, don’t say that out loud, but build a manual process, see if anyone wants it, see if it works, and then turn it into software. And everyone’s like, oh, well, that won’t scale. That’s not the point. The point is a minimally viable concept. So, yeah, I think, again, if you’ve seen a lot of movies, you see the people raise a bunch of money, have a top down. I know the answer.

Alex Prasad:
We’re going to execute on this answer kind of approach where this bottom up. I know nothing. But I have the skills to test the theory, react to it, and modulate it to what I think is going to be the best economic outcome is the right way to go. You can’t convince people you’re kind of in one plan or the other. You can’t convince people to think the other way. The top down stuff can work. Don’t get me wrong, I think maybe Elon Musk is a great example of that guy. Just lots of things there with that guy.

Alex Prasad:
But, like, no one can deny that. Electric cars, space travel, that was top down. He had a vision. He’s like, I know how to get there, let’s go. And it created something that wasn’t there before. Let’s put it like that. So from that perspective, it definitely has worked.

Dana Robinson:
But it’s not a model, right? Let’s just tell our listeners this is not a model to follow. You decide you have a novel idea, go get a bunch of money and start a business around you. Top downing to something is a recipe for failure. Everybody I know is either started a business doing what they know ground up, or they bought a business and then they learned beginner’s mind everything they needed to know about that business and followed best practices, get good lawyers and counsel, and they grow that business into something that prospers is the Elon Musk. Whatever. Seems clickbaity in the entrepreneur and business world is probably bad advice, probably wrong.

Alex Prasad:
Yeah, that’s good. That’s good feedback. Yeah. And I’m encouraged at a high level that more people are opening their eyes. Entrepreneurship by acquisition. It’s still entrepreneurship. The idea that the only definition of entrepreneurship is right. You’re in your garage.

Alex Prasad:
You’re Steve Jobs again, another one in a billion sort of person who did top down many things and did so successfully. That’s why there’s books about these people is. That’s novel and crazy and unique. And doing it brick by brick, as you describe, is not run of the mill, but, I mean, that’s a more repeatable model. It’s less dramatic, for sure. Right?

Dana Robinson:
Yeah.

Alex Prasad:
Yeah. I’m an EO entrepreneurs organization and good peer groups, etcetera. And I have a friend who’s built a super tremendous SaaS business. He’s in my SaaS forum, we call him, and he was asking me what’s next? You have a timeline here. You want to turn this thing around, sell it. And you talked about. I talk about with my employees. I’m not going to be here forever.

Alex Prasad:
I’m not a golf guy, born and bred. I’m here to do a job and achieve this result with you all. Then we’ll do something else. Said, oh, well, I want to start something. I want to do it in a different way this time. He said, well, what if you’re good at turnarounds? Like, that’s terrifying. He said, why don’t you just buy something? Like, you’re the guy who started the thing from scratch? He goes, yeah, but I’ve been at it for 24 years. It’s been really hard.

Alex Prasad:
I said, well, I think we’ve met because we like to do hard thing. It was just a funny, out of botty conversation. But there really are. I mean, again, you’ve lived this experience, right? Dana, on the buy side, these trade businesses, so many baby boomers, etcetera, retiring. From a touchy feely perspective, it’s a win for everyone. This is this person’s retirement path. As a potential entrepreneur by acquisition, you’re kind of helping this person achieve their dream, achieve that exit path successfully. You can feel good about that.

Alex Prasad:
It’s not like this person was running the business poorly. But with your experience, there’s low hanging fruit. Right. And those things, your skillset will be different and different perspective. That’s likely to level up the business. So, yeah, they’re both different. You know, chocolate and vanilla, it’s still ice cream. I mean, it’s still entrepreneurship.

Alex Prasad:
Yeah. In fact, sometimes harder. You know, in some ways, zero to one versus taking the thing, the plane that’s already flying and swapping out the parts. There’s different challenges.

Dana Robinson:
Yeah, 100%. So where you’re at in your experience now, are you going to do the entrepreneur cycle again or are you going to just focus on the law practice after you finish this turnaround? Deeply personal question that probably only your wife knows the answer to. But I’m asking you on a public podcast, thousands of listeners.

Alex Prasad:
I think in my mind, it’s focusing more on the legal practice and taking a break as you have a break is the wrong word. Right? Sabbatical, whatever, to kind of recharge the batteries. One of my really good friends said, I think you could probably use like a year or two of your brain not being in overdrive 24/7 yeah, that seems, you know, that seems like a, like a good idea. Also, anyone who knows me knows, you know, wouldn’t bet for that result. So, no, I do really hope. Yeah. The focus among legal practice and focus just, you know, on my young kids and, yeah, like, maybe take a breather. It’s kind of been a dead sprint for, you know, my whole.

Alex Prasad:
It feels like my whole, I mean, my whole life, whatever that means, but it really has. I didn’t study abroad. I didn’t. It was not that, like, you’re God given right to study abroad, but went straight through right school, etcetera, work, school. There was no lost summers in there or whatever. And my wife as well. But, yeah, it’s too fun. And I like the people problems and working together as a team to solve something.

Alex Prasad:
So that’s not to say that I’m not interested in that. I’ll call it repeat story of these deals. Right. That is really great, too. But there is a start and a finish again. My wife’s an anesthesiologist and I love her very much, but every day is one day, right? And they do procedures, and the procedure starts and finishes, and then the next day there’s more procedures, and the next day there’s more procedures. And to me, you’re not building towards anything. I mean, that’s not right.

Alex Prasad:
It doesn’t fit my personality. Right. Whereas every day I’m like, well, we’re a little bit closer to where we wanted to be. She kind of makes fun of me for that. It’s like, well, when’s ever going to be done? It’s never going to be done. That’s the fun part. Right? There’s always going to be something more. No matter how successful you can make the thing, there’s always going to be another rung that you want to grab.

Alex Prasad:
But yeah, it’s fun to have challenges, to turn it over and work together as a team over a long period of time and look back and go, wow, six months ago, three months ago, where we are today, there’s real progress there. That’s really fun and cool to be able to measure that. So, yeah. Long answer to your short question, but I’m sure I’m excited to take the learnings and apply them again. Right. Under different conditions and what held water, what didn’t. But maybe a break, maybe you’ll probably.

Dana Robinson:
Do something where it doesn’t rise or fall on you, but where your wisdom and these learnings get borne out. Let me switch back to your lawyer brain a bit. It’s important, I think, that people find lawyers that understand business and doesn’t always mean they’ve got to have done business like you and I have. I think that that’d be pretty tall order to tell. Entrepreneurs only go work with your m and a guys that have and gals that have been in business because I think plenty of great lawyers have just learned so much from the thousand deals they’ve done.

Alex Prasad:
Right.

Dana Robinson:
But what do you know in terms of like, step one, help, help me think through for our listeners. How do you decide what lawyer to work with and to get that lawyer that’s not going to screw the deal up. That’s not going to block everything that has empathy and understands the sort of art of the deal and knows what’s good enough and knows how to advise around risk and then let people make their decisions and not sort of like become the quarterback.

Alex Prasad:
But that’s a great question, actually.

Dana Robinson:
I can’t just say hire me. You can’t just say hire?

Alex Prasad:
No. I found this. It’s only a couple dozen maybe posts now on this blog, but I have enjoyed trying to reverse engineer this question. Right. Because I’m not at the other end of the spectrum, if you will, or on the other side. Often, though, we do use attorneys right. In the entrepreneurial link. But I actually just posted, I think, last week, Tuesday around, you know, again, how do you know if your lawyer is any good? Basically, like you’re known known? It’s Donald Rumsfeld speech, if you’re familiar, which you know, Donald Rumsfeld aside, this is brilliant, right? But known knowns, things you know, you know, known unknowns, things you know you don’t know.

Alex Prasad:
And unknown unknowns, things you don’t know that you don’t know, which is a lot of you know no’s. But you know, a sufficient lawyer. That’s fine. Is going to help you on known knowns. Right. These are legal risks. Here’s what the purchase agreement says. They substantively understand it and they can communicate it to you.

Alex Prasad:
That’s fine. The better attorney is going to help you on the known unknowns. Like, here’s the things we don’t know. We can’t possibly know them at this stage, for whatever reason. Let’s navigate those, factor that into your decision making. And with experience, though we can, definitionally, you can’t know the unknown unknowns that universe, though it’s still large, the known unknowns universe and the unknown unknowns universe and m and a transaction is startlingly large. They’re shrinking the unknown unknown universe. You can’t measure that, but they are with their experiences because they’ve seen more things.

Alex Prasad:
There’s more known unknowns and fewer unknown unknowns. Sorry. The easiest metric, though, Dana, is just, do you want to have a beer? If you’re a beer guy, or whiskey or whatever, or if you don’t drink and you know, you like calling your lawyer, yes or no? Because if you don’t, if it’s like pulling teeth and you’re like, oh, man, they’re going to bill me this 10th of an hour. And it’s a really easy question, you’re not going to get the most, regardless of, let’s just say that’s your. So, Dana, you’re hiring me just for the example, right. And you don’t like talking to me. It doesn’t matter if I’m good or bad. You’re not going to get the most value you can get out of me because you’re going to hesitate to call or ask.

Alex Prasad:
That’s no good. You got to like these people that you’re putting on this team. Buy or sell side. So in your role, pe, you are a repeat actor, but there are a few repeat actors, especially in the space that I’m playing in and that you’re playing in. Right. A lot of one time actors, especially on the sell side. Right. These people have built h vac, roofing, plumbing companies often don’t do it right five times in their career.

Alex Prasad:
This is a really important life event. Just in general, why do you want to do it with people you don’t like? Just as general, just as a general rule of life in general, try to respond to people that you like. But second, yeah, you’re not going to get the value if you don’t actually enjoy the conversation. So I really don’t think, and so I wove this in, but I started my legal career at Tennessee Law School and I finished at Notre Dame. Two very different academic institutions, right. I can tell you, flip the coin. There’s different emphasis emphases at these two schools, right. Look more academic at Notre Dame.

Alex Prasad:
They want you to be a judge. Tennessee just wants you to be a great lawyer. I mean, at least that way it was twelve years ago or whatever, but you’re gonna find good attorneys from either school. It’s not about the plot, it’s or the credentials. So I mean just like anything any higher in the entrepreneurial lane, like talk to people that you know and look for people that they trust and like maybe easy answer there, but if you don’t like even in that initial call having a conversation with the person, it’s, you’re not going to get the most value out of them. It sounds so simple. And then I guess I do look for the stories and I do that hiring. Right.

Alex Prasad:
Employees too. I actually, when we try to hire employees at v one, and I think this applies as well, I write like the life story of the ideal person. I’ll get down to like do they have a dog or not? Sometimes like there’s an avatar of the ideal, you’re kind of just matching against it. So you’re doing, you’re selling your business and it’s going to be, you know, it’s a deal under $5 million likely to be financed by seven a. Like, okay, so you know, you probably want an attorney that’s on a bunch of those deals or a team that’s on a bunch of deals of that size. It’s be better, right. So you can ask some questions about, you know, that not in a gotcha sort of way, but just can they tell you stories? I mean I can tell you stories about, you know, the sellers, they got the truck, you know, they want their truck, right? I know it’s their work truck, you know, it’s titled name, right. And the banks like losing their minds because it’s all assets and whatever.

Alex Prasad:
I just want my truck, you know, like I find those, you know, problems to solve hilarious and fun. Other attorneys will hate that, right? I mean this is not, not one’s better not one’s worse, just different people. Right? Some people love the. What’s, you know, 80 single faced pages. I like to deal with the truck thing. Like, dude, you got to get up the truck. Like, you get $3 million. Like, no, but this is my truck.

Alex Prasad:
Like, oh, bank. Like, can you let the truck lean, slide? Like, it’s just one truck, right? It’s appreciated. Like it’s old anyway. Like, that’s a fun human problem to navigate. So, again, another long answer for you, Dana, but, yeah.

Dana Robinson:
No, no, no. You just boosted your credibility, because I think I can think of three deals where a truck or an rv have been on the balance sheet and. And become problematic for one reason or another. You know, like, this truck has no title. Well, the solution is, like, just let me keep the truck then. You know what? We let him keep the truck. Like, but, you know, there’s other. Other people would.

Dana Robinson:
Would, as you say, like, completely meltdown over this deal, getting done with a truck that has no title, when you should just let that guy keep his title. This truck.

Alex Prasad:
Maybe a less, like, tongue in cheek response is, where do these attorney. So a. The person who does deals, please. Right? If you’re going to do a deal, get the person. Like, don’t hire the estate planner who doesn’t do transactions or the guy in your local town who does everything and bailed you out of jail last night for a DUI to do your deal unless it’s something they really do. That really does have negative impacts, because the expectations of the two councils are just wildly apart, and it takes so much effort just to get even remotely in the same universe. So that’s one thing for sure. A piece of advice.

Alex Prasad:
And the other is the deal size. You know, what are the size of deals? Because you can over lawyer things for sure.

Dana Robinson:
Oh, yeah.

Alex Prasad:
And for deal sizes, again, I’m just assuming. But if we’re talking about a deal, that’s this SBA seven, a under five million dollars. Five point five million dollars. Lane, it was a conversation I have with every buy side client, which we do mostly buy side work at this stage. Somewhat coincidental, somewhat referral network, etcetera. But you’re not gonna do diligence for you. Like, what does that mean? Well, you’re doing your quality of earnings. You’re gonna flag stuff.

Alex Prasad:
We’re gonna help you. As you flag things, we’re gonna suggest things that we’ve seen in other deals for sure, but it’s just not a no stone unturned. Like, do you want the publicly traded diligence memo that no one reads, but you’re doing it just for, like, a cy. You don’t want that. It’s not worth it. You don’t need to read a bunch of, like, I don’t know, roofing invoices. Yeah. No, you don’t know.

Alex Prasad:
It doesn’t fit right. So you can a. The specialization, or I would say, you know, inch wide, mile deep. That’s what we are. You start to stray not very far away from the deal making, and I go, I don’t know I’m gonna get the right resource. You don’t want to talk to me about that. I just, you know, tv lawyer. Right? I don’t know enough to really actually do it.

Alex Prasad:
But the second is the size, because if people aren’t used to playing in that size range, they’ll do things that are, that feel right for a different size deal. The level of diligence, if you will, that we do on a small deal is completely inappropriate for a deal that’s $50 million. It would be malpractice to be delivering services in that way if there was a TEDx larger deal and vice versa. In my opinion, the specialization and the size are two things that you can be on the lookout for. They’re easy to get to the bottom of pretty quickly if you’re in the buying lawyers mode.

Dana Robinson:
All right, so there’s a bullet from, from your resume of content of that would be interesting that I took notes on to talk about. And I want to squeeze this in so we don’t have to make it more than five minutes. But I love the, I love the call to action on this. The. So you want to buy a business a crash course in pitfalls and easy wins. Can. Can you give me a five minute crash course? I’m buying a business. Pitfalls and easy wins.

Dana Robinson:
You probably make it three pitfalls and three easy wins. And.

Alex Prasad:
Oh, okay. All right.

Dana Robinson:
And then you can write a blog post about it.

Alex Prasad:
Yeah. Right. There you go. Yeah, I’ll just, you know, we’re recording this, right, as an AI tool, right. You know, give it to chat, GPT. Okay. So from the buy side, pitfalls one. Did you talk about working capital in the llc? If you didn’t, huge miss.

Alex Prasad:
It’s dollars in one pocket out of the other. You’re going to do it in five minutes. Right. So that’s an easy one. You got to talk about that earlier rather than later. Pitfall number two, customer concentration and sellers relationship with high concentration customers, meaning like big parts of the book of business. Is it our family members or these people that go back to high school? Because that handoff has to happen. Forget about what the contract says.

Dana Robinson:
Yeah.

Alex Prasad:
That’s a human relationship right. Now. Say third is from a pitfall. Maybe this is a. I’m going to looking at the clock, right? You got me on the clock now I’m going to do, I’m going to do one that’s both, right. Make the seller your best friend. You have to. Even if you don’t love the person.

Alex Prasad:
There’s going to be a transition period. There’s going to be things that no one thought about prior to the deal. You got to call them six months later and say where are the keys of the truck? Or whatever it is. Right. And it’s just going to grease the skits because every deal is going to have bumps in the road. And when there’s a bump in the road, two reactions. One, they’re trying to screw us. Or two, that’s bad.

Alex Prasad:
I’m going to go call the counterparty and see what’s going on. Right. As you’re knee jerk. And if you make them the best friend, you have that in the back of your mind. They’re just going to call you and say, what’s the deal with, right. As opposed to immediately jump to. So easy wins again, the working again. You could probably do them both.

Alex Prasad:
They’re like both dual purpose. Right. But the Loi thing is just so important. An easy win is communicating your goals and trying to understand. I know a little bit of repeat of earlier, the sellers goals. Right. They want to retire, they want the boat. Whatever it is, they’re going to take it.

Alex Prasad:
Understanding that will help you structure the deal. There’ll be things that matter to the seller that don’t matter to you. Trade them away, give them what they want. Right. In exchange for what you want or need. Right. Maybe it’s a longer transition services. I think the biggest win may the last one in a short period of time is understanding.

Alex Prasad:
You just have to admit to yourself that doing the deal increases risk. You can’t get rid of risk. You’re just shifting it. You’re taking on a lot of risk as a buyer and you’re shifting a lot of it away from the seller. But there’s no amount of lawyering or tap dancing that’s going to reduce the overall risk. It’s going to be what it is. And then by disrupting these relationships, by buying a company and having putting a new person in charge, these key customers, key vendors, etcetera, you’re increasing it. So just trust the process.

Alex Prasad:
If you’re committed to doing it, admit that that’s the case, but there’s no amount of engineering you can do to change that. So just give up. I like that.

Dana Robinson:
I like that.

Alex Prasad:
But just give up on the concept that, like, if the better lawyer is gonna somehow, like make the risk go away, just not the way it works.

Dana Robinson:
I love that because it’s commentary about lawyers that business people need to hear. We cannot do what business people do. Business people are risk reward engines. You, entrepreneur, should not be doing something where you are not constantly doing that calculus in your head. Risk reward. Risk reward is what you do. If you’re stepping into a business that you understand well, then you’re going to feel comfortable or not with the risks. And the lawyers will do their job to be sure that they’re watching for the unknown unknowns and talking you through the known unknowns and bolstering your understanding.

Dana Robinson:
But it is the business person has to say. This risk reward calculus is one I’m buying and I know how to make money on this.

Alex Prasad:
Principals and agents, you’re the principal. You decide. The agents is there to help you. You can’t shift it to the agent decide.

Dana Robinson:
Basically, you know what, you did it in less than five minutes. Stellar. And now you can rip part of the script and throw a throw. Have AI throw a a great little blog post for you, Alex. Super good to get to know you and have you on the podcast. If people want to connect with you, what’s the pathway?

Alex Prasad:
Yeah, you can find me on LinkedIn. You can reach out to me via email and I know in the blog or the podcast description there’ll be links, but just reach out in any of those means. LinkedIn is probably easier with my name. Aprasadagislaw.com is the email address. I’m happy to chat whether it leads to something today, tomorrow, or never so I can meet more people like yourself. And if there’s an alignment of interests as we discussed, then we’ll find a way to work together in some way, shape or form. I’m sure.

Dana Robinson:
I love it. So last, it’s Alex Prasad. P r a s a d. Easy one to connect with on LinkedIn. Obviously everybody and I appreciate those that have listened through and don’t forget to interact with me. Hellonaro. See you guys next time. Or, well, you’ll hear me.

Dana Robinson:
Thanks for joining me on this episode of the Exit Plan podcast. I’d love to hear from you. Feel free to hit me up with questions or comments by emailing me at hello@danarobinson.com or leave comments and questions by calling 858-252-7785 call 858-252-7785 and leave a message.