Jenny Clark talks with Rich Gross and Michael Valdez about transitions.

Jenny Clark:

This is Jenny Clark with Solvability in today’s Florida GovCon podcast. I’ve got two special guests with me, Rich Gross and Michael Valdez.  Among the three of us we’re really going to talk about life, military and business transitions because we’ve all been through those.  We have talked to a lot of people that are going out through their own transitions and our job is to help advise them and see where they want to go and how they want to get there. The big question is the “Why” of it, so today we’re with Rich Gross, who is a retired US Army Brigadier General, now an attorney in private practice, and you’re focused on federal contracting, right, Rich?

 

Rich Gross:

That’s correct, to me that’s one of the big parts of my practice right now.

 

Jenny Clark:

And I also found out that you actually have Florida roots.  Your mom was born in Tampa and grew up in Clearwater and you spent some time here at MacDill.

 

Rich Gross:

That’s absolutely right. I was at US Central Command (CENTCOM) from 2010 to 2012. My family and I lived on base.  My son went to Robinson High School right there in Tampa and we just love that town. We love Florida and of course, my mom’s roots are there. I used to go as a kid to visit family and so forth.  I feel like I’m even though I wasn’t born in Florida I do feel like I have Florida roots.

 

Jenny Clark:

We’re going to find you a way to get back down here more often because one of the things we’re doing as part of the Florida GovCon podcast and the Summit that we’re doing in Orlando in 2018 is really trying to connect more of the people that are stuck up in traffic on the Beltway to come down to Florida and work with us down here. And I think we’re going to make it more attractive and take them out on the boat and everything that we need to be doing for that.

 

Rich Gross:

Now that just sounds great, I think folks that don’t live and work in Florida really don’t have a good picture of just how much federal contracting there is down in Florida between NASA the Department of Defense all the military bases and so forth, there’s quite a bit.

 

Jenny Clark:

Yeah it extends all the way around the state. Orlando has probably got the biggest concentration with PEO STRI and some NAVAIR. There’s obviously the Panhandle, Jacksonville, some in Miami, all over the place so we’re really looking to gather some of those companies together and create more of a connected community with that.

So back to you, Rich. I understand you’re a West Pointer and you completed your law degree at the University of Virginia and then you started in the infantry in the Army and transferred to the Judge Advocate General Corps. Talk to me a little bit about what that was like and what that role is.

 

Rich Gross:

The Judge Advocate General’s Corps is essentially the largest law firm in the Department of Defense. It’s all the military and civilian lawyers and paralegal and support staff who provide legal support to the Army. It includes, as I said, officers and civilian attorneys and so forth. We provide support to commanders and their staff on every issue you can imagine, just like an in-house counsel would support a corporation or a company and then we also provide legal assistance to family members and soldiers who need help with family law, separation, divorce, estate planning, tax, and so forth. And then there’s also a side of our practice where we do military courts martial which are federal trials, criminal trials against service members who violated the Uniform Code of Military Justice and we have military lawyers in the JAG Corps who were both prosecutors and defense counsel representing the defendant on trial.

 

Jenny Clark:

So that’s a broad range of services and I had not realized until I learned a little bit more about the deployment process that part of moving forward to go to be deployed besides going to visit the dentists and medical is to update personal information.

 

Rich Gross:

Oh absolutely, we have a process where we prepare soldiers to deploy whether it’s for combat or for training or exercises overseas and that process includes visits with the medical personnel, dental personnel, our personnel department, our finance department, and our legal folks. And we help soldiers make sure that their wills are up-to-date that they have powers of attorney for their family members so they can conduct business on behalf of the soldier and the family while soldier is gone, so it’s an important part of the pre-deployment preparation.

 

Jenny Clark:

Well we talked about how the family members are really involved in the deployment because they’re going to be taking care of everything back home while that military member is overseas and I know that you went through that yourself because you’ve been deployed multiple times in Afghanistan, Iraq, and elsewhere, so what was it like for you when it was time to “I’ve got to head out for a bit”

 

Rich Gross:

It can be very tough, there’s a lot of uncertainty when you deploy. There’s certainly risk. I mean when you go to a combat zone there’s always risk no matter who you are or where you are on that battlefield and there’s the anxiety with family members who are left behind. You often have a spouse who has to fill both roles. In my case, my wife and I had young children when I first deployed into Afghanistan in early 2002 and you know she had to play both mom and dad for that period while I was gone and in subsequent deployments. There’s missed birthdays, missed anniversaries.  I missed Christmas a few times since 9/11 but that all pales in comparison to military service members who come back from the war injured, or in some cases soldiers don’t come back at all as they made the ultimate sacrifice for their country. And then that is extraordinarily difficult as you would imagine on a family, the loss of a loved one, you know. The anxiety and handling, thinking about that is just tremendous, which is another area where sometimes Judge Advocates are called to help family members who were dealing with soldiers who come back with post-traumatic stress or soldiers should come back with physical injuries or sadly when soldiers don’t come back at all.

 

Jenny Clark:

Well it’s certainly something that having the support systems in place makes a big difference.  I know that you’re really dedicated to working with those individuals and your previous life and also supporting  them as you’re going forward. I also understood that when you were at CENTCOM, you had an important role working with General Mattis.

 

Rich Gross:

That’s right, I was the chief legal advisor. What we call the Staff Judge Advocate for US Central Command.  So when General Mattis was in command of CENTCOM I was his in-house counsel.  I was essentially his general counsel for the two years I was assigned there, although the second year I had been pulled up to the Pentagon to be the legal counsel to the Chairman of the Joint Chiefs of Staff. It is a very important role when you’re advising a commander or a Chairman of the Joint Chiefs on everything that comes across their desks.  It involves a legal issue just as an in-house counsel would advise a CEO or C-suite executive on everything that goes on at a company.

 

Jenny Clark:

I think you also told me about General Mattis and the working relationship you had, and your thoughts on his leadership. It’s amazing.

 

Rich Gross:

He’s extraordinary. I mean he is one of the most intellectual commanders I’ve ever had the privilege of working with. He thinks very deeply and carefully about problems. He studies. He reads more than anyone I’ve ever met.  He’s just a font of wisdom, and so when he’s made a decision you know he’s taken the time to think through it very carefully. He’s also a student of history and always takes into consideration historical examples that may help him in his thinking. He really is an extraordinary commander and I just can’t be more pleased to see him now as our Secretary of Defense.

 

Jenny Clark:

I also understood your last assignment was in the Pentagon. You already mentioned it was as legal counsel to the Joint Chiefs of Staff, General Marty Dempsey. Tell us more about that.

 

Rich Gross:

That was probably the most challenging and fascinating job I had in my thirty years, although from time to time I think I’ve said that about every job I’ve ever held. But the legal counsel the Chairman of Joint Chiefs of Staff is the top military adviser by law to the President, the Secretary of Defense, the National Security Council, and he plays a role in all the national security decisions. So anytime there was a national security issue that involved a legal issue and they almost all do, I would be involved with preparing him, briefing him, advising him on those military operations or those national security issues. I went to meetings multiple times in the White House with the National Security Council staff, working closely with the Department of Defense general counsel and the other interagency lawyers dealing with national security law issues. I dealt with just a host of issues day-to-day, besides the national security issues, and the military operational issues. Often with General Dempsey there were other issues that would come up, things that would appear on the front page of the newspaper. Things like bribes and sexual assault statistics or Congress wanting a briefing on a particular program and anytime anything like that came up then I would provide the legal advice for that as well. We’ve got a saying in the military you have to be a mile wide and an inch deep on your knowledge. You have to be prepared to deal with virtually anything that comes across your desk and find the experts who can help you think through the legal problems and then advise the boss.

 

Jenny Clark:

And being able to go through those kind of challenging high-pressure assignments is critical as well. We’re going to be talking in the rest of the podcast about what it was like to transition from your military to your current role at FH+H and some of the activities related that you’re looking at now as you work with federal contracting clients including things related to mergers and acquisitions. So Rich, you don’t talk that much about yourself, but what else would you like people to know about you?

 

Rich Gross:

Well, the thing I’m probably proudest of is I’ve been happily married for 28 years. My wife and I have three adult sons that we are very proud of.  One just graduated from college, and the other two are about to enter their fourth year of college.  You know, I just couldn’t be prouder and I often tell folks that time goes very fast.  When you’re thinking about transition, or when you’re thinking about your career, or when you’re thinking about your business, you have to take a moment and stop and look around and think about your family and spend time with them, because if you don’t pay attention to your family, the time will go in a blink of an eye.  The next thing you know, they’re growing up and moving on, and you don’t have time now to do anything about that and so it’s just spending time making time for family.  It is absolutely critical.  I did a pretty good job of that.  Nobody’s perfect but I’ve seen so many people, military and civilian, devote so much time to their careers, and then get to the end of them, and they’re like “oh by the way”, there was this family here with you the whole time. They didn’t pay any attention to families and now their families won’t pay attention to them.  It’s sad to see when you see it.

 

Jenny Clark:

Well, Rich, I know you’re glad to be stateside and be with your family on a regular basis and it’s a big benefit to you.

Now I’m going to talk about Michael Valdez.  Michael and I met when I first moved down here to Tampa Bay.  He started a group called the Business Transition Council which is focused on the unique issues faced by business owners as they go through Succession, Transition, Exit and Planning (STEP.)  Michael is a wealth coach and advisor and he specifically has worked with several of my federal contracting clients on issues of how do they maximize the benefits out of their company and protect themselves and their company as they move toward retirement or selling their business. But Michael’s approach is unique and I’ll tell you why. It’s because he really draws out the why of what you’re trying to do, what are you trying to accomplish so he can help you get to the end goals, and I would tell you I wouldn’t be standing here doing what I’m doing today if it wasn’t for the influence that I’ve had with Michael in helping to draw out from me: “how are you going to get there, what do you want, what do you really want?”  So Michael did I describe you correctly?

 

Michael Valdez:

Yes, Jenny, I think that was a great description overview of what I do and how I work with people. One of the keywords is “Retirement Readiness” and, of course, when you’re a business owner you start your business up and you get moving along.  The key is: “are you really ready?”  It’s not just how much cash flow you have, or the value of the businesses.  It’s also your ability to see into the future, and figure out where you’re going, and how you’re going to go?  Why you want to do what you want to do?  Where you are in totality, not just the business itself.  Many times, people forget the other components that are important for being “Retirement Ready” or be ready for a transition or transaction later in life.

 

Jenny Clark:

So today’s podcast is about transition.  We all go through transitions and sometimes we don’t quite recognize what we’re getting ourselves into until we look back, so I decided that I would share my transition story as well.  I’m calling mine “midlife to new focus”, because I don’t want to call it a midlife crisis.   To summarize what I’ve been doing over the last five years, if you told me five years ago that I would be doing a podcast with a retired Brigadier General and my friend Michael Valdez, I wouldn’t have said that could happen.  What changed all for me is when I saw things in my life where I no longer had responsibility for other people. My daughters graduated from college, and my daughter Anne got married.  I decided that was the right time for me to go ahead if I was going to do it – it’s now or never to leave my marriage and leave Huntsville, Alabama and go someplace new. I chose Tampa Bay because I had a bunch of friends that would help me out down here. At that same time, I’d had Solvability for 18 years and an opportunity came up for me to merge that with a CPA firm and I took that because that was the thing that got me out of debt, and cleared me, put me on a salary, and let me be move forward again after a long period, which was really stagnation from the end of the recession until the current time. I couldn’t see where I was going to go.  I couldn’t see how to expand, and so that cleared that. I had also taken time to take care of my mother and father, and my father passed away in 2013. Right after that the CPA firm contacted me and said “guess what we’re merging with another CPA firm.”  I realized it wouldn’t be 15 minutes before the other CPA firm looked around and said who the hell is Jenny Clark and what are we doing with her in Tampa Bay, because we have nothing to do with federal contracting.  So the opportunity was presented that I could basically roll back to being Solvability again, and I decided I’ve been given this opportunity I’m going to take it in a new direction the way I’ve always wanted to.  I’m really now working on that direction.  I have launched an online training program where I focus exclusively on federal contracting in small businesses and I’m really trying to help those businesses accelerate in their growth.

Michael, what I’d like to do then is talk to you a little bit about what you see in working with clients because I know that you really focus not just on the transactional side but the transformation and the psychological side.

 

Michael Valdez:

Thank you, Jenny.  When we talk about Succession, Exit, Transition and Planning we’re really talking about that process that people go through and we really try to coach companies that it’s a three to five- year process. It can go faster than that, but it doesn’t always work successfully.

One of the things that I know that people do, is that they’ll do lots and lots of due diligence and working on if they’re buying a company or the people who are thinking of buying a company on their liabilities or taxes?  Do they own the real estate?  What are the actual legal contracts that are in place?  Can we verify all the things that the business owner says are true about the business?

But the one thing that people tend to give little credence or spend very little time in is the actual soft side of the planning.  And that is, is this really what the business owner wants to do?  Do they know where they’re going next?  How will this affect the relationship with their spouse?  How will it affect the relationship with former employees?  Will their former customers be concerned about them?  So often we’ll find that people have a financial number they’re moving towards, and as they get in the middle of all of this they decide that they’re not quite ready, and sometimes those decisions are behind the scenes. I know the people who are driving the process: the merger and acquisition professionals, the attorneys, the CPAs. As they’re doing their specific jobs, looking forward trying to get this transaction to close and to complete, they are always taken aback when the business owner takes a hard left or a hard right, literally stands up in the roller coaster and falls out of the transaction. So what we try to do is really take a more comprehensive client-centric, a holistic approach to the people that are involved and the assets that are actually being transferred so that we have a successful succession that takes place.

 

Jenny Clark:

I think you’ve described it as not that much different from dealing with family members when there’s a big transaction getting ready to happen because they don’t really want to talk to each other that much. It’s awkward to have these discussions.  Nobody really wants to share what’s in their mind because to some extent that’s a secret. I don’t want to tell you that because that might give you a different advantage and I don’t want you to have that. So what we really talked about is that the transactions are driven by an attorney or a CPA or whoever’s doing the due diligence that’s trying to close that deal, and we’ve got to have a way that somebody is being what you call it “client-focused” or “client-centric” to take care of that client.

 

Michael Valdez:

Yes, I think that’s important and that’s one of the roles that we play in sitting beside the client and helping them explore these possibilities and that’s why we want to take three to five years. So that we’re not trying to make a decision under the gun or with a pointy stick to our back. Every entrepreneur who has created a successful business has put their blood, sweat, and tears into that business. It’s 24/7 and just as Richard described being at the pinnacle of his career in the most important decisions, the entrepreneur is sitting in that same emotional place and the idea that they’re going to go to a closing table they’re going to sign some paperwork some money is going to show up in their account and then what’s going to happen. It can be very scary so part of this process is not just understating the financial plan, but understanding a personal plan and that goes not only for emotional strategy of where you’re going, but with many clients the discussion also turns to the spiritual strategy.  In other words we have to look at the whole person as they’re going through this process.

 

Jenny Clark:

Well, I think that that’s a good way to wrap up this podcast talking a little bit more about this, and what I’d like to do Rich is just hop back to you for a minute. I know that you’ve talked about working with companies through these type of process and I guess what do you see on the emotional side what kind of things do they go through?

 

Rich Gross:

Well I think Jenny that Michael hit it on the head and you know for a lot of business owners like he said blood, sweat, and tears. I mean a business is their whole life, right or wrong. It’s like a child in many ways.  They’ve nurtured it.  They’ve watched it grow, and suddenly they’re being asked to let it go, sell it, or transfer it to family members, or whatever the final outcome is. That’s an incredibly difficult decision and incredibly difficult step for a lot of business owners. I love what Michael said about emotionally and spiritually preparing for that. I think all too often in business settings we are focused as a community way too much on just the money, the documents, the contracts, the stock plans, the employee agreements and we don’t focus on that individual who’s going through it, maybe going through a very difficult time. I know, for example, and I’ve never sold a business, but when I left the military that was a very difficult thing for me. You know waiting, thinking somebody was going to call, somebody needed me, and they just didn’t.  And that’s a good thing, but it was difficult for me, and you see that a lot as well. There’s a lot of planning that has to go into this transition. You need to have a good idea of what the end state is going to look like whether that’s a transfer to the employees, whether that’s a transfer to family, whether that’s a transfer to a complete outside owner who is going to take over the company and then from there that detailed planning that Michael talked about to know what steps you have to take to get there. It’s not a transaction.  It’s a process and there are things that you have to put in place, often early, and get things moving in the right direction. For example, you may have critical employees who are a part of your team that if they were to leave your company, the value of your company would decrease dramatically.  Particularly in companies that don’t own factories, but primarily, they are human capital companies. They do federal contracting, and provide personnel to contracts. If your key people leave, like your business development person, or some of your key staff, if they leave the company, then the value of that company may drop dramatically.  So, you’ve got to have in place employee contracts, and employee incentive plans, and so forth that make sure that the value of your company stays the same. What you don’t want is some employee saying, “well you’re selling the company so I’m leaving”, and suddenly the value of your company drops in the middle of negotiations. That’s just one of hundreds of things conceivably that you need to plan for in this business process.

 

Jenny Clark:

Well, I’m glad you went over all of those steps because if somebody were to come up to me and say: “I want to sell my company so what steps do I need to take?”  I guess the first thing we’re saying is do some planning, figure out what you want, and then work with people with professional experience that understand the industry and can prepare you for it so that you can take the steps that you want to get the results you’re looking for. So, thanks so much for both you, Richard and Michael, for being here. I think we make a great team on trying to bring these issues forward, so I’d love doing another podcast at some point.

I just wanted to summarize that Solvability works with small businesses who are federal contractors. I’ve got some training, advanced training for small business that are federal contractors. Rich, I can see us doing something with your GovCon University.  I think that’s a great idea and I know that’s a passion of yours and certainly we’re all going to be together at the Florida GovCon Summit 2018, which will be in Orlando on February 28th and March the 1st.  One thing we’re adding is matchmaking because there are so many companies that we see who need to know each other and need to find ways to work together especially in this most competitive environment. We’ll be adding more breakout sessions, and have some more collaboration sessions.  Thanks so much for your time Rich, and great talking to you, too, Michael.

 

 

Michael Valdez, Synergy Wealth Alliance

Michael Valdez is an investment advisor representative offering securities and advisory services through Cetera Advisors LLC, member FINRA, SIPC.

Phone: 813-546-2203

e-mail: michael@synergywealthalliance.com

 

 

Rich Gross, FH&H Law Service

Phone:  703-590-1234

 

 

To contact Jenny W Clark

CEO, Solvability, Inc

www.solvability.com

Phone 256-882-6276
E-mail jwclark@solvability.com
Linkedin Solvabilityjwc
Twitter Solvabilityjwc

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