#238: Why the Greatest Entrepreneurship Hurdle is all in Your Mind with Mike Smerklo

On today’s show, we have Mike Smerklo, author of Mr. Monkey and Me: A Real Survival Guide for Entrepreneurs and co-founder of the VC firm Next Coast Ventures, which helps the best entrepreneurs in the world as they build disruptive businesses. The team at Next Coast Ventures has raised over $7 billion in capital and created exit values of over $30 billion. He’ll share the mindset that brought him success, how he gained it and what he learned along the way. I’m excited to have him on the show because most people think what he’s accomplished is out of reach, and that’s just not the case. We’ll do a deep dive into the mechanics of his three rounds of financing so you can see just how doable it is. Listen for tips on managing and treating customers, the benefits of going IPO and how to get your team on board, and why he’d never make a deal without tying equity to both sides of the table. Mike has achieved 40% year-over-year, so this is an episode you don’t want to miss.

My big takeaway from this episode is, even someone as successful as Mike (with all of his achievements), the fact that he still second-guesses his success is proof that we’re all human. You should recognize that the things that you intentionally accomplish over time is well deserved. A really clear plan will help dissolve that impostor syndrome. Education is another thing that will help dismiss and get rid of impostor syndrome and will ensure that you’re living and working intentionally.

 
What You Will Learn In Today's Podcast Interview

Mike’s background and story
How poorly a “must be nice” mindset serves you and how to break out of that head space.
Why Mike hates the phrase “fake it ‘til you make it” and what he believes people should do instead.
Not all experts are the type of expert you need and you have to be able to identify what specific expertise you’re looking for.
The incredible value in having a coach, no matter what stage you’re at.
Why he chose the search fund model over all the others.
How his company managed the ups and downs of the tech market, including the ways he had to raise cash during the downturn of 2008.
When you should tie equity to performance on both sides of the deal table.
The pragmatic way of looking at sprucing up your business and how it compares to renovating a house.
The benefits of having a “maniacal focus” on customers.
Mike’s three questions for evaluating how well you’re treating your customers.
Why your executive team needs to stand up for what they’re talking about and how that gets reflected in your company.
How Mike and his team determined to go IPO and gained consensus.

 
Are You Growing The Value of Your Business

Take The 2-Minute Assessment To Get Your Intentional Growth Score™ And 1-Page Vision Board.

Are your company's current initiatives intentionally designed to increase the value of the business?
Do you know what you want from your business long term and why?
Do you know what your company is worth?
Do you know the differences between Management, Family Transitions, PE Firms, ESOPs and Strategic Buyers?
Does the business have a written strategic plan on how to achieve the desired normalized EBITDA and valuation?

 
About the Guest:

Mike Smerklo is an experienced entrepreneur, investor and business leader driven by the desire to turn ideas into reality. Having bought and scaled a small business into a publicly traded company worth nearly a billion dollars in value, he has a deep understanding

On today’s show, we have Mike Smerklo, author of Mr. Monkey and Me: A Real Survival Guide for Entrepreneurs and co-founder of the VC firm Next Coast Ventures, which helps the best entrepreneurs in the world as they build disruptive businesses. The team at Next Coast Ventures has raised over $7 billion in capital and created exit values of over $30 billion. He’ll share the mindset that brought him success, how he gained it and what he learned along the way. I’m excited to have him on the show because most people think what he’s accomplished is out of reach, and that’s just not the case. We’ll do a deep dive into the mechanics of his three rounds of financing so you can see just how doable it is. Listen for tips on managing and treating customers, the benefits of going IPO and how to get your team on board, and why he’d never make a deal without tying equity to both sides of the table. Mike has achieved 40% year-over-year, so this is an episode you don’t want to miss.

My big takeaway from this episode is, even someone as successful as Mike (with all of his achievements), the fact that he still second-guesses his success is proof that we’re all human. You should recognize that the things that you intentionally accomplish over time is well deserved. A really clear plan will help dissolve that impostor syndrome. Education is another thing that will help dismiss and get rid of impostor syndrome and will ensure that you’re living and working intentionally.

 
What You Will Learn In Today's Podcast Interview

Mike’s background and story
How poorly a “must be nice” mindset serves you and how to break out of that head space.
Why Mike hates the phrase “fake it ‘til you make it” and what he believes people should do instead.
Not all experts are the type of expert you need and you have to be able to identify what specific expertise you’re looking for.
The incredible value in having a coach, no matter what stage you’re at.
Why he chose the search fund model over all the others.
How his company managed the ups and downs of the tech market, including the ways he had to raise cash during the downturn of 2008.
When you should tie equity to performance on both sides of the deal table.
The pragmatic way of looking at sprucing up your business and how it compares to renovating a house.
The benefits of having a “maniacal focus” on customers.
Mike’s three questions for evaluating how well you’re treating your customers.
Why your executive team needs to stand up for what they’re talking about and how that gets reflected in your company.
How Mike and his team determined to go IPO and gained consensus.

 
Are You Growing The Value of Your Business

Take The 2-Minute Assessment To Get Your Intentional Growth Score™ And 1-Page Vision Board.

Are your company's current initiatives intentionally designed to increase the value of the business?
Do you know what you want from your business long term and why?
Do you know what your company is worth?
Do you know the differences between Management, Family Transitions, PE Firms, ESOPs and Strategic Buyers?
Does the business have a written strategic plan on how to achieve the desired normalized EBITDA and valuation?

 
About the Guest:

Mike Smerklo is an experienced entrepreneur, investor and business leader driven by the desire to turn ideas into reality. Having bought and scaled a small business into a publicly traded company worth nearly a billion dollars in value, he has a deep understanding of the hard work, dedication and grit that truly powers successful entrepreneurship. Today, as the co-founder and managing director of Next Coast Ventures, Smerklo is a champion for a new generation of entrepreneurs building disruptive companies in big markets. His new book, Mr. Monkey and Me (Scribe Media, Nov. 17 2020), is a “real talk” guide for entrepreneurs who want to cut through the noise to cultivate a mindset that supports greatness.

 

Quotes:

7:13 - “A lot of entrepreneurs have a chip on their shoulders.” – Mike Smerklo

11:00 - “Well, I’m the entrepreneur. I’m the CEO. I should know everything.” – Mike Smerklo

18:28 -  “If you ask people they’re good drivers, and all ten people raises their hands, there shouldn’t be any accidents, right?” – Mike Smerklo

21:22 - “Go find someone who has sold a similar business recently who can give you practical advice.” – Mike Smerklo

29:52 -  “My economic relationship with my equity investors was tied to performance.” – Mike Smerklo

45:08 - “Whenever you’re going to raise capital, think about what the person who is giving you money is expecting out of that transaction.” – Mike Smerklo

50:05 - “We expect 30-40% to fail. We expect there to be a pretty high failure rate. We expect that a couple will do okay. And then one or two are going to blow it out of the water.” – Mike Smerklo

 

Links and Resources:

Mr. Monkey and Me: A Real Survival Guide for Entrepreneurs, by Mike Smerklo

Mike Smerklo’s Official Website

Mastering Your Cash Flow Digital Course

ARKONA Boot Camp

Reach out to me if you have questions about the boot camp!

 

You can also reach out to me via email at [email protected], or on my LinkedIn.