Today we’d like to introduce you to Danny Fields and Steve Reis.
Danny and Steve, let’s start with your story. We’d love to hear how you got started and how the journey has been so far.
While in Rice University’s MBA program, we met each other and discovered that we had many shared experiences, from growing up in entrepreneurial families, to attending military colleges and serving in the US Army, to having an appetite for entrepreneurship. After learning about an opportunity to raise money and then use that money to search for a business that we would ultimately purchase and operate ourselves, we decided to partner and go on that journey together.
It took us roughly 5 months to travel the country and raise the capital necessary for us to quit our jobs and start searching for the business we’ll buy. We’ve been searching for about 18 months now.
Great, so let’s dig a little deeper into the story – has it been an easy path overall and if not, what were the challenges you’ve had to overcome?
By no means has it been turbulent, but we have seen some obstacles. The process can be an emotional roller coaster. When we begin getting very interested in a business, it becomes personal. We imagine ourselves running the business, we picture ourselves living in the area where the business operates, and it begins to feel like the deal is complete before anything is signed.
If the deal falls apart after you’ve invested emotional capital, it can be draining and cause disappointment. When that happens, we typically go out for beers to metaphorically lick our wounds and get back on the horse.
Alright – so let’s talk business. Tell us about NextGen Succession Partners – what should we know?
We are a small private equity fund with the goal of acquiring a single business that we will personally operate and manage long-term. There are many versions of private equity, but ours is that we are the succession plan for a business owner who is ready to retire and wants to see the business thrive. In particular, if the owner wants the employees to have longevity in their jobs and is concerned about the future legacy, our approach aligns with that.
Other buyers may want the current owner to remain in the business under an employment contract, which gives that ownerless flexibility to retire immediately.
Additionally, some buyers already have their own back office employees and will want to immediately reduce redundant headcount after they buy the business in order to achieve better profitability. That approach doesn’t work for us since we don’t have a back office.
We rely heavily on the management team and the employees in place for future growth in the business. When we think about our approach, we are really proud of the fact that we offer business owners an alternative to their company being gobbled up by a large corporation and changed to the extent that it’s unrecognizable. With our acquisition plan, their legacy lives on, and the employees can count on a secure future.
Is there a characteristic or quality that you feel is essential to success?
There are two things we see as critical to our success. We must first find a great business, and once we’ve found it, we must get the deal done. In the case of finding a great business, success comes from an unbiased evaluation, assessment, and analysis of a business. Maintaining objectivity is a very difficult task but something we must do if we want to identify a truly strong business. If we fail at this, we potentially become stuck operating in a very challenging business and industry for years.
Because we can’t just rely on finding a strong business, and we also need to get the deal done, the second characteristic is being sensitive to the seller’s needs. Of course, the deal needs to make sense for us as an investment, but without the buy-in from the seller, there’s no deal to be done. Being sensitive to the seller’s needs doesn’t only mean paying them what they want for the business, it’s also understanding that the business is potentially a part of their identity.
In many cases, they founded the business decades ago, and it has become a part of their everyday life. Their personal and professional life are intertwined, and it’s critical to build a relationship that creates the trust necessary for them to be comfortable handing the business to us.
Contact Info:
- Address: 118 Vintage Park Blvd, Suite W-308 Houston, TX 77070
- Website: www.NextGenSuccession.com
- Phone: Danny Fields: (706) 761-5644, Steve Reis: (713) 726-4010
- Email: Danny@NextGenSuccession.com Steve@NextGenSuccession.com
- Facebook: https://www.facebook.com/NextGenSuccession/
- Other: https://www.linkedin.com/company/nextgen-succession-partners/
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