Having great counsel helped prepare Next Step Energy Solutions CEO Chad Lembeck for his process. But the process itself, he says, helped him learn things about his business that he might not otherwise have learned. And despite it being a taxing and oftentimes uncomfortable experience, he got through it in part by being comfortable with that discomfort.
The management presentations, he says, were the most important component as it helped him find some symbiosis with the company he would eventually work with.
“It was a lot like speed dating for us,” Lembeck said at the Denver Smart Business Dealmakers Conference. “We got a chance to really hear some interesting stories about how other folks would look at this investment. We walked away and we just felt like we know we have the right people.”
Something else that was important was being comfortable with being uncomfortable. He says in these meetings, he was the one in the room who knows the least about the process. The other folks in the deal do this every day.
“This is a once or twice opportunity in your life,” he says. “So, being comfortable asking questions that may seem juvenile, that was the biggest piece for me — not being afraid to ask questions.”
Though there were definitely things that they knew they weren't going to be ready for, being ready to be uncomfortable allowed them to be more comfortable.
“The process was taxing, it was difficult, it was fun, exciting at times, but I think [counsel] prepared us really well to know that you’re going to feel a range of emotions, and those emotions will change,” he says.
He says they were a little bit conscientious of when they let their employees know about the deal, but they had a really thoughtful process beforehand about what the discussion topics were going to be like.
“We set out a really great plan for them to understand what this was going to mean to them next year, the year after that, and five years down the road,” Lembeck says. “So, I think that was something that was recommended beforehand. And for us, my role has not changed. So, I think that's helpful. We didn't move accounting somewhere else. The operation, for the vast majority of it, stayed the same. So, I think the operations folks felt very comfortable about the transition.”
He says he enjoyed the process more than he thought he would, as most discussions about it can make it seem as if it’ll all be doom and gloom. Learning something new from each interaction was a great piece for him. If he were to go back and talk to himself ahead of the process, he would mention how quick it is, how many fun people he’ll get to meet, and the many different ideas that come up.
“Probably the main takeaway is just slow down and enjoy the process,” Lembeck says. “It goes very fast. There's lots of different timelines and deadlines and updating numbers and what that looks like. It's been really exciting and great for us. So I'd say, slow down and enjoy it. It's not quite as terrible, I think, as everybody may make it sound.”
Even though there were some challenging spots, like being asked to roll forward the QofE many times, he says there were still positives to take away from such things.
“It helped us a lot with forecasting, understanding the next iteration,” he says. “As you professionalize more and more, our initial thought process was always customer centric — how do we do better for those folks? And becoming stronger on the back side has been a really important component to this. So, even rolling through multiple times allowed the shock to be less, understanding what our quarterly boarding meetings look like now, and how we handle budgets and forecasts.”
