Investing in the Right Leaders with Adam Ringo

1,000 Stories


Adam Ringo: If we started to evaluate things on a relational score the relational magnitude or the relational weight or the relational value that we carry with other people, and we thought about that a lot more than we thought about underlying asset value or monetary value. Then it’s a lot more fun to do business together.

Joe Mills: What we’re here to answer this season is how do business leaders navigate these major points of change, these inflection points in their businesses? And then what are the tools and practices they use to make sure that those big moments are successful? I’m Reid Morris. And I’m Joe Mills. And we’re embarking on an investigation this season to answer that exact question.

Reid Morris: Then we’re taking our learnings, and we’re sharing them with you to help you navigate your own inflection points. 

Joe Mills: This is 1,000 Stories, an original show from Element Three.

Reid Morris: Okay, Joe, so we are going into our third conversation of the season, and… We’re going in a little bit of a different direction with who we’re having as a guest in this essence of getting different perspectives. And so talk the audience through who we’re having on and some of the reasoning behind that.

Joe Mills: Yeah. So we’re having Adam Ringo on the show next, and Adam leads an investment group. The reason I particularly wanted to talk to Adam at this point in time, outside of him just being a very interesting guy with an interesting background, outside of the traditional finance model that leads towards private equity, which will be fun to unpack a bit of with him, and that might even indicate to us how he answers this question, we’ve talked to the individual themselves going through a leadership change. We’ve talked to somebody who’s coaching individuals who go through all sorts of changes. Now, I want to get somebody who’s investing in a leader for the first time and implementing that change sort of on them or with them. So one of the things that we’re interested in exploring inside of these inflection points is taking on outside capital and what that does to the organization, what it does to a leader, the goals it implies, the way that your life changes, how you navigate that. And so the perspective I want from Adam is… You hear very regularly we invest in the people, not necessarily the product or the company. Not that every company does that, not that every group does that, but it’s not an uncommon parlance to say we’re looking for great leaders. Well, what does that even mean? What does it mean to be a great leader? How do you judge that from the outside? Because you think every time you interact with that person, they’re trying to be on their best behavior. It’s sort of like when you interview people. And you’re like, am I getting the full picture of them, or am I getting the best picture of them? No, you’re getting the best picture of them, but you’re trying to understand their full picture. And so I’m very interested from the outside perspective, somebody coming in, investing in a company, and thereby investing in an individual. What are you looking for? How do you discern who is good or not? Who’s up for it or not? So that’s really where I want the conversation to go on is how do you think about observing people from the outside? And I know that Adam is a very values-driven individual. I know that he’s not somebody’s we just look at their track record and call today It’s like he is thinking about the person, and so I want to know what that means.

Reid Morris: In addition to that, as we are talking and thinking about toolkits over the course of this season, it will be interesting not only to hear about his framework for decision-making and what he looks for in a leader but also what tools Does he use in that decision-making process? Because we’ve had people on the show who have gone through multiple acquisitions bought by sold by private equity, all these different things. But I would say we’re also largely speaking to people who are driving towards that for the first time. And so what are the tools? What are the things that these people think about that these first-time people that in theory that’s what you want to march towards, right? Many people want to sell. And so how can we kind of open their minds to what are the tools that these people are using in addition to what they’re thinking about as they’re making these types of transactions? 

Joe Mills: Love that. I think it’s a great place to go as well. Really excited for it. Welcome to A Thousand Stories. Adam, we’re really excited to have you on. Thanks for making the time a friend. It’s good to be here. I have not given the people too much context on you because I find that your story is very interesting and not the one I would have anticipated for your current role. Just sort of catch up, brief intro on what you do, and then how you got there, because I find it really interesting.

Adam Ringo: I run a family office. We have a holding company, privately funded by a couple of us, predominantly the family. And we invest directly into small to medium-sized businesses. And we take a controlling interest, not too dissimilar from other family offices or Private equity if you will. And that comes with a lot of connotations, but we are permanent capital. We buy companies for the long term. We want to build the buy-and-build concept. That’s pretty popular in that small to medium-sized business world. That’s what we want to do. We want to buy, we want to hold, we want to build. What we call platforms for flourishing lives. There’s a lot there.

Joe Mills: You have a very interestingly people focused Investment strategy in a world that I think sometimes Misses that as a focus like very numbers very growth-oriented Multipliers, how am I gonna turn this business over and I think sometimes it gets the rap of being not very people-centric But I think you guys take a fairly people heavy approach to it 

Adam Ringo: There are a lot of great holding companies, funds, and other family offices out there that care deeply about, and they adopt this permanent capital strategy for the same reasons that we do. We have some other underpinning philosophies that guide and push us to do what we do. Yeah, at the end of the day. That permanent capital strategy allows us to, do we care about building sustainable businesses that are profitable? Absolutely. And candidly, that’s what’s good and loving and helpful for the people.

Joe Mills: Yeah. I’ve been pondering the question lately of, what is an idea that you would give your life for? 

Adam Ringo: So one of the things that I think a lot about personally for personal value, and we adopt this value at Watercourse Investments is this idea of radical simplification as we build Watercourse, as we grow companies, let’s choose things that simplify our lives that simplify how we do things, how we run things and create capacity specifically from us. As managers and overseers of these entities, that creates capacity for us to creatively think on behalf of the companies and the people, for example, people think of investment firms or private equity firms, or even limited partners who are investing for a capital return. Well, if you’re a passive investor and all you care about is the number in the spreadsheet, then that incentivizes the managers of that money to do that thing that only creates a return to you. We’re freed of that limitation. And so we’re able to think about and do things like, okay, well, what is wealth generation and why does it matter? And for us, it’s like, well, okay, we create wealth. Well, how do we as partners around the table, challenge ourselves to be? Even if overly simple how much money we take what the distributions are that come back to us What would it look like to be radically simple in life so that we can leave more money in the businesses and create more impact? For the people in the businesses, maybe that looks like, sure, giving them more money paying people more and doing whatever it may be. But how do we invest back into the businesses so that these businesses can be enriched and sustainable in a way that provides a multi-generational impact? And therefore, it’s not all about us and our limited partners taking the highest possible returns. And so don’t get me wrong. We want to make money, and we want to be really good at that. We challenge ourselves on like. How much is enough and why is money the only thing we strive for?

Joe Mills: I have a question for you on that. Even in the way that we’ve both been talking about it, there does seem to be this underlying feeling that having the goal of making more money is in large part, culturally thought of as a negative. You’re like, don’t get me wrong. We want to make money as if there’s something that’s like not accepted in that. What do you think about that? Well, 

Adam Ringo: going back to capitalism. So money is just simply a tool, and people think the same way about religion. People don’t like the church because there are people in it. So people don’t like money because of what people do with it. It’s a tool that’s misused by humans. And that’s the same thing with capitalism, like capitalism. People don’t like capitalism because of the fact that it has people in it. And the fact that people abuse a system and get away with it, unfortunately. And this isn’t my phrase, and I’ll butcher it, but it’s probably Warren Buffett’s or somebody along those lines, but capitalism is the best alternative. It’s the best system that we’ve gotten. And candidly, if people operated according to its design, I think it would be 

Joe Mills: really good. If you didn’t operate it in a crony capitalist society, it would be much better.

Adam Ringo: Because the same thing goes with ownership. We are owners of businesses. We intend to own more businesses. I think owners in the sense that mainly because in theory they’re making all the money, this goes to why I think we desire to ensure that we show that we give back and not take all the money. But owners, they’re just associated with having all this money, like, oh, it’s incredible to be an owner of a business. If I could, it would show people the amount of risk and weight and sleepless nights, challenging years and moments, and days and weeks that come along with this title of owner. It would be like morbidly distracting for people. 

Joe Mills: It’s interesting. You just brought up the church being similar. People dislike the church because it has people involved in that. So misuse it. And you brought up ownership. And I think the other phrase for that would be stewardship. Do you guys think about yourselves as you enter into a business agreement? Like our job now is to steward the impact that this organization can have in the future? Yes. 

Adam Ringo: Like passivity, or maybe let’s sit back and steward what we’ve accumulated here. Our version of stewardship is taking risks on behalf of multiplication and impact. Impact doesn’t happen without growth and impact doesn’t happen without long-term sustainable growth. We got to make some money to do that. We have to treat people really well to do that. People have got to come want to be with us and work with us and be a part of our vision. We feel like stewardship is required. An immense amount of risk, and that’s what we love to do. We love to take on calculated risks, and stewardship should look like reinvestment. It should look like a risk. It should look like sacrificing on behalf of the people, 

Joe Mills: etc. So it’s an interesting bridge over to. One of the main things I want to talk about is how you make that decision to invest in a business.

Cause we talked about when you and I were just sitting down and meeting for the first time, what makes a good business? And I said, well, like outside of the PNL and the financial due diligence and some of the market fit, and your response back to me was a really great leader or something along those lines. And I’ve been thinking about that in the context of the conversations we are having. Because we’ve recently met with somebody who transitioned out of the CEO role in Mark Caswell, he was our first episode. We talked a lot about identity theory and why that matters so much for being able to manage that role. So then we went and talked to somebody who’s an executive coach and spends a lot of time helping people understand who they are. A lot of identity work. What was interesting about this conversation is how it ties into the one that we’re having is now from like the other perspective I’m about to invest in a company. I’m gonna take ownership of it. I’m gonna buy the company I’d imagine These are all my assumptions in my head You’d want a business that has upside still left to tap into so that you can create sustainable growth for it into the future On one hand, that could be done with or without the current leader in place. But I’m not sure which one you would see is Maybe the better of those options. And a lot of times, those companies likely have other substitutes. So the best ones, like you said, have great leaders. This one feels so hard to judge from the outside, the leadership, the leadership piece. And so I’m interested about like, as you walk into that. How do you start navigating that? Does this leader fit the kind of person that we’re looking for?

Adam Ringo: Having done it wrong multiple times, and still doing it wrong, and then candidly just lucking into some good leaders. I’ve been able to experience now what it looks like to work with great leaders, and what it looks like to work with not-so-great leaders, and having to migrate. Existing leaders that founded the business out of the business. That’s really tough. That’s no fun. As a matter of fact, I don’t want to do that again. 

Joe Mills: Well, that’s an interesting point right there. As I said, I’m not sure which one is the better option, about the same leader or a different leader to help steward it. And you just answered like, ah, preferences. What makes it hard to transition the current owner out?

Adam Ringo: Generally, if you’re selling a business, you’re selling it for a couple to three reasons. One, you’re selling it because you’re ready to retire, and there’s no like generational takeover, but it’s a great business. It’s cash flowing well, but it’s just time.

Joe Mills: Yeah. You’ve built value. You want to realize the value.

Adam Ringo: Yeah. And that’s generally in some type of mature industry that’s got plenty of competition. And there’s marginal improvement to be done there, whether it’s in the form of consolidation or whatever new improvements, technology, standard stuff. Your second would be, Hey, this is a skyrocketing industry. And this was an early entrant that has been running it for five to seven years, built it to a certain degree, and they’re ready to fully just monetize. And that’s purely monetization. It’s on the rise and there’s a ton of opportunity, but they’re done. They’re like, I did all the hard work. I can go get a 12x multiple or something of that nature. Cause this industry is blowing up. And I was one of the first ones at it. There’s other healthcare, new models in healthcare, new models. And even in the service industry, like there’s, uh, that’s been a field day over the last five to seven years. Or thirdly, it’s distressed. They’re tired. It’s not producing cash, whatever it may be. And the industry may be working against them, or they have a management team that’s just, ah, I don’t know how to solve this. So they’re ready to go. And really they need a bailout button. To answer your question on buying a business in this category where there is A leader who’s either founded or been at it a long time and hasn’t been either on, like, it’s a good business. If they’re ready to retire and want to migrate out, that’s actually perfect. It’s this one where they want you to come kind of bail them out and save them. And we’ve done that now a few times where we’re a capital player. We’re going to provide strategic value. We’re going to infuse different systems and infrastructure into the business. And they love it, but they want to stay and be a part of it. And then you want them to adopt your playbook because they’re asking you to help come fix things. In reality, if they were honest and you were honest. They’re interested in the fix, but they’re not interested in you. They’re interested in the good of what you can bring, but they can’t give up control. That’s what I mean by they’re not interested in you. They’re not interested in you coming in either taking a role, like we do. We get very operationally involved. And so they’re not interested in you taking that operational lead or bringing someone else in. They may say they are, but I would doubt it. Maybe somebody else has a better experience, but only because everything that I’ve experienced it is so difficult. 

Joe Mills: Do you think it’s a lack of intellectual humility in that individual to be like, This business, it’s not succeeding to the level it should be. Maybe I’m the reason. And that takes a level of just like humility and lack of ego to be able to say that. I think people who take the plunge to start something for the better have a strong personal belief that I can do the hard thing. And so then they go, and they want you to be the solve button, but they’re like, ego is still in the way of, but I need to be the one that makes this thing really successful. Do you think that’s part of it?

Adam Ringo: I think it’s probably more identity than ego, truly, because 30 years. And for whatever reason, your identity just is wrapped up in that business or wrapped up in the people, may not even be the business, it’s the relationships, it’s the people, it’s the fact that you’ve served breakfast on Fridays for 15 years in that business. And even if you can’t make a profit, it becomes your family in a lot of ways. So it’s either highly relational. Highly just identity or ego or something along those lines that causes it to just be difficult for them to look. It’s not their fault necessarily, but you have to be willing to either make drastic changes, change yourself quite a bit and relinquish control in order for it to work with us or with any buyer that comes in for that matter.

Joe Mills: So when you start talking to somebody, even maybe before you start talking to somebody, you start looking at a business opportunity, and you know that this person needs to be open to new ideas, new ways of doing things, or playbook for lack of a better term. How do you start sniffing that out, about whether or not they’ll be that type of individual?

Adam Ringo: I would define it as alignment. So like, we can quickly realize, let’s forget about just the business capabilities, like for a second, we can come back to that, but it comes out in personality a little bit. So yeah, we need to be personality-aligned in the sense that do we jive? Do we have chemistry? So, we could use some Cs, right, to know whether or not we’re aligned. And alignment is everything. There are certain value and belief sets that are important to us, but do we have chemistry? Do you have the capacity? Do you have a calling to what you’re doing? And then, The chemistry is like the chemistry among the future partnership team. Do we believe that they have the capacity to do what we’re asking them to do and what we want to go achieve according to some vision? How do you judge that? I mean, there’s a lot to learn from history. There’s a lot to learn from talking to the team in as much as you can talk to a team. If you’re in an acquisition process, it’s harder to talk to the team, but you can lean on certain assessments like personality and. skill set assessments and these things, this Enneagram, we know that, but can they operate within a system and among other people and work within a partnership that has a lot to do with personality capacity is more. There’s a lot to learn from history, and there’s some stuff that as we talk to them about certain things and certain things that we want to do, I can pick up on, okay, they’ve either done this really well in the past or if they haven’t, they have the ability to be coached into it. And it’s simply a coaching thing. And they would put in the effort and or are they intellectually curious? Obviously, we’ve seen a lot of businesses. We have our own methodologies of doing things in terms of what a business cycle looks like what a budget development process looks like. If they have some level of sincere intellectual curiosity, that’s a bit captivating. I know instantly, okay, we can work with this. That’s how we think about capacity. 

Joe Mills: People aren’t formulaic, right? That’s one of the things I’m hearing from you is we feel it in the room. There’s not some sort of test that we can give them and be like, Oh yeah, that person checks and doesn’t check. One thing that seems to be tied together is they have a desire and willingness to be coached, which I feel is quite a shift for somebody who’s the owner and founder of a business because, a lot of times, they’re the answer to every question. When they’re operating that company, at the end of the day, every question could escalate to them. And they don’t necessarily get the opportunity to turn around and ask somebody else to tell them the answer. So they, like, always have the answer. Do you witness that with people? Where it’s weird for them to transition from I’m supposed to always have the answer to actually having the benefit of saying I don’t know, like, the answer to that?

Adam Ringo: Yeah, both good and bad. So, the bad is like, I don’t want your help. I’m used to making all the decisions. I become infatuated with the ability to just like constantly be the one where the buck stops with me. You almost get addicted to that. A lot of founders, CEOs, business owners, whatever, they do that. Then, on the other side, I have found that we just bought a company three weeks ago and are very aligned with the visionary, the CEO of the business, both personalities wise, we believe in the chemistry that we have and his capacity and his calling to kind of like go all in on it. But he is loving the freedom that comes with, Hey, I have more people at the table. It’s lonely at the top. You hear this all over the place, right? It’s lonely at the top. We can dig into why. Quantify that. Why do you think? I think it’s lonely at the top. I think it could be multifaceted. But at the end of the day, again, no one understands the weight that sits underneath just by making payroll every week, especially in small to medium-sized businesses. Like, until you’ve run one. All the impact, every tax regulation, every supply chain issue, every price increase, every customer complaint, every bad review on Google, like you wear all of it. And it’s hard for anyone else in the business to actually fully understand that. So there’s a ton of weight that comes with that. And then this idea of constantly being the one that has to make the decision, constantly being the one that has to be looked upon for creativity and innovation. And then, if you’re just having a bad day, it’s really difficult to go home and have no one. And it’s kind of like being in a marriage. There’s this beautiful complimentary relationship where you’re in it together. As a business owner, sometimes it’s hard to find that person. Your competition isn’t going to give you the answer. Yes, there are peer groups out there, but am I doing the right 

Joe Mills: thing? I was just having a conversation with our CEO about the difficulty of getting a feedback loop, in the business world. One of the things that I personally miss about, so I played college soccer. Athletics are such a lovely feedback loop-oriented space. I don’t jump high enough, or I’m bad at this specific play, or I don’t hit curve balls well, like whatever the thing is, every sport’s got their things that you can call out, this is a weakness in, and then you just get to fix them, and you get to improve at them, and you work at them, and you know how to do that. And business, it’s so much harder to find the things to diagnose the feedback loop. And if you’re at the top, it’s actually harder because who’s going to be your feedback loop? 

Adam Ringo: Yeah. I think that generates a lot of loneliness. Diagnosing is like what’s going wrong. Why is this not working? What am I doing? I raised the pay scale, and yet. The complaints have increased like the business is really good at telling you something’s wrong, but diagnosing it and actually understanding the root cause. That’s magic. I mean, that is truly an art that, like the financial statements, is the science of the business, right? They’re the indicators that are telling you whether something’s right or wrong. But at the end of the day, understanding the root cause of that and then being able to, in a winsome way, lead people into a formative improvement process is the art. That’s what makes great leaders great.

Joe Mills: The people we talk with on this show are ambitious, driven individuals who feel called to create positive outcomes in all aspects of their lives. 

Reid Morris: And as we all know, with that drive comes pressure and stress, and in order to show up and be your best self, it’s extremely important to have a professional at your side who can help you navigate that journey. So that’s the reason that we’re really excited to be sponsored by BetterHelp. BetterHelp is the world’s largest therapy service. They have over 25,000 therapists, and it’s all online. What’s really great about that is that if you don’t connect with the first therapist that you interact with, it’s super easy to try another, and that allows you to connect with the person that’s best for you.

I think it’s awesome that in this day and age, you can just do it from the comfort of your home. I mean, Element Three ourselves is in a hybrid environment and we’ve all become accustomed to this world of doing things that fit your lifestyle. So we love that better help can help 

Joe Mills: do that too. And for listeners of this podcast, you can get 10 percent off your first month on Better Help by going to Better Help. Slash 1,000 Stories. Again, that’s better. H E L P. com slash 1,000 Stories. So, how do you find good artists? 

Adam Ringo: There’s a couple types of leaders, right? You’ve got your visionary leader, and then there is truly like the integrator, according to EOS, but simply like the president or the COO of the business. The person who’s magical at just getting people rowing in the same direction and executing to an accountability every single day. Both of those are magic and some people are good at both, but generally they’re two personalities. 

Reid Morris: Okay, so there’s been some discussion here around EOS, or the Entrepreneurial Operating System. For those of you who aren’t familiar, it’s a business operating system. It’s one that Element Three uses, and it’s one that Adam and his team use with a lot of the companies that they operate with. It is a great business system. One of the things that we would recommend is that if you don’t have one in general, it’s definitely great to have one. EOS serves companies up to about 250 people, but there’s others out there like Rockefeller Habits. like pinnacle business systems. So we would encourage you to go dig around if you don’t have one because it can be a real accelerator for some of your decision-making as you’re thinking about some friction you might be experiencing. Take a look at these if you don’t have one. 

Adam Ringo: There are natural giftings in both and both of them require an immense amount of effort. Both of them acquire self-motivation and then both of them require curiosity and challenging the norm and both of them require. Uh, crazy follow through, just not being satisfied with one, the status quo, but not being satisfied with not following through.

Joe Mills: Well, it’s interesting. I think about that in our world. We have a visionary and an integrator and our visionaries, our CEO, Tiffany and our integrators are president Kyler. Kyler exhibits some of both, but he knows that his role here is to put on the integrator hat more than the visionary hat. Is that one of the frameworks that you use to think through when you’re looking at a New business like are you starting to sort them a little bit in your head of like that person leans visionary that person leans integrator Is that one of the ways you look at it? Or does that come up later?

Adam Ringo: The alignment is the first thing that we look for in a leader. We grade it by some things that we talked about. Just chemistry, calling, capacity, but even beyond that, can we run with this person? Forget about how good they are. Can we run with this person for the next 15 years? Do we want to run with this person? Do we believe in him? Do we get along with him? Et cetera. And do they adopt some of our, like, philosophies of doing business? If they don’t adopt our philosophies of doing business, it doesn’t mean that they’re not a great leader. It’s just that we’re not going to work together. They have to be able to care about those things that we care about. Do they have to have every belief that we have? No. Whether… That’d be a theological belief or not, or just a practice belief. No, but philosophically, they need to work within the fences that we have set. 

Reid Morris: Okay, so I want to take a quick moment and pause around this idea of the three C’s of chemistry, capacity, and calling. Now, this isn’t something that was specifically called out as a framework, but as you’re thinking about some of the things that you can apply to. The decisions that you’re making, the situations that you’re navigating in this context of leadership transition. I’d challenge you to think about this idea of, again, the three C’s of chemistry, capacity, and calling as a way to figure out, is someone the right fit for the business today? Is someone the right fit for the business tomorrow? Or for you as the leader, are you the best fit for what the circumstances require? So again, a pretty helpful framework that wasn’t specifically called out as one. 

Adam Ringo: We’ve encountered more and more businesses and leaders. Absolutely, to your point of How are we bucketing them? Yes, we’re bucketing them according to, are you a fantastic executor? And can you lead, manage, and hold people accountable to like an unbelievable degree? Then we’re going to think about you in this bucket. And then, are you absolutely critical to the business? You’re the reason the business started. You’re the reasons the business got to where it’s at. Everybody in the industry, you’re phenomenal at thinking about. Ideas and people and culture, you’re like, so emotionally in tune to what the people want and what’s going to get them motivated and inspired and involved and engaged in the business. We got to have you too. And you may be terrible at holding people accountable. Actually, you may be so pathetic at walking into a room, leading a meeting and saying, okay. What are the next steps who’s signing up for that and who’s doing it and oh, by the way I’m gonna ask you next week whether we got that done and they’re like terrified of that 

Joe Mills: I could see myself being like, oh, I wish I was the other one Do you see leaders trying to do it all when they just should be more of themselves?

Adam Ringo: This is funny that you asked this question. So Thursday of last week, I was in Colorado. We have a business headquartered in Fort Collins. They’re in the cryogenic space distribution space. Our leader there, the best integrator I’ve ever seen. Ex military. So captain in the military. X, large corporate, so Caterpillar, Trinity Industries, his superpower is truly a blended ability to both be highly emotionally in tune, but yet an unbelievable executor. So it’s kind of like the perfect storm of a troop leader. He is able to winsomely convince everybody to come with him on the back of high accountability. He gets people to want. to raise their hand and own all of these tasks that have to be done and love doing it along the way. 

Joe Mills: This is John Goff on our team.

Reid Morris: Okay, I want to take a quick moment here to call out another episode that you could go listen to if you want to go a little bit deeper here. So, Joe mentioned John Goff, who is an individual on our team, as one of these individuals who can, quote, do it all in this context to people with a lot of varied skill sets. So, if you want to go listen to the episode, get a little more context as to who that person is and what that means, I go to episode three, so it was very early on in the podcast. It was published on September 7th of 2022. So again, if you want to go deeper on that individual, learn a little bit more. Episode three of the podcast. 

Adam Ringo: He’s a master at it. I’ve never seen anything like it. If you want to talk about somebody who, according to discipline, you do the small things every day, all day, and then you wake up a year later and you say, well, how did we get all this accomplished? He’s the guy who does that every single year. And I admire it. But we don’t have that traditional visionary, like this analogy runs true and is used everywhere, but the forest and the trees, yeah. What is our three-year picture look like? How are we going to get there? Who do we need to talk to? What market headwinds are coming our way? You could tell he was getting a little offended when we were bucketing him in this integrator role. He was like, but wait, I want to be known as the visionary too. I love those aspects of the visionary. So I should just be both. There’s aspects of the visionary role that I think you can do, but let’s be honest about it and honest about who you are and what you are best at. You could tell that he was getting physically uncomfortable with the way the conversation was going.

Joe Mills: We were just having in our last conversation about like identity and the way you see yourself. And I kept using the word build or the phrase build identity. Eventually at the end of it. West said to me, he said, I like everything you just said about, it’s not build, it’s discover. And I’m curious with this individual, that guy is superpower. Like you said, it’s just like the best integrator ever do the small details, right? Get people to get on board and want to do tasks, follow you, like all those pieces. Do you see it repeatedly where people like. Their superpower seems so normal to them that they want a different one. 

Adam Ringo: Yeah. It’s kind of what seems sexier.

Joe Mills: Yeah. Like I wish I was more detail oriented. You know what I mean? I’m just like, I’m not like, I like to move fast. And just inside of like the sales process, I have a high eye. I have a high D and a high eye. And the problem with high eyes is they have high need for approval. I want people to like me. And I go and I meet with our sales coach who’s not got a high eye at all. The problem with that is like saying the hard thing to a prospect that they need to hear. So they make a good decision is much harder. If you like. I want them to like me. And so I get literally envious of people who don’t feel that way, who can just be like, I got to call out this red flag to you and we got to talk about it. So I like miss the benefits of who I am because I’m looking for the thing that I don’t have. And I’m trying to like make it a thing that isn’t real to me. Do you encounter that with people who are leading organizations? People 

Adam Ringo: who are founders or CEOs or entrepreneurs or whatever you want to call them, they’re going to espouse one of a few things, right? They’re going to espouse like tenacious ambition, which is driven by like the desire to achieve. There are people who are just beautiful artists and creatives and they by nature of being creative create something that the world wants or an industry wants. It just happens. And they’re probably terrible at running businesses. Nobody just happens to fall into these positions, right? Maybe at a big corporate, it’s more of an election than it is like earned. Sorry for those people who are in big corporate, but in small business, it’s earned a hundred percent of the time. And so you didn’t just stumble there. You worked really hard to get there. So that’s just brute force in a lot of ways, like taking the hill. And so, you naturally have this desire to be something. I don’t think that ever stops, and if it’s not, it can be really good. And if it’s channeled appropriately, I think it can be really great. The problem is, we lose sight of what’s important. It becomes everything to us, or it becomes like ultimate, and then therefore, we just like keep looking for something that’s going to provide this satisfaction or provide that. Thrill or provide this compliment or reinforcement of our thing. And it’s like, Hey, if we’ve gotten bored or if we’ve accomplished this, then it’s like, well, I’m going to go be that person too. I can do that. Oh, I can be the visionary. I can go run sales. If you want me to be better at confrontation, I’ll just go be better at confrontations. One of the things that we talk about at Watercourse is if an amazing thing for us is in 15, 20 years. If a majority of our team members at every portfolio company that we’re invested in, if they could say, Hey, my identity is not wrapped up in what I do. I am not defined by what I do. That’s not how I’m defined. That is not who I am. The kingdom of me is not going to rise and fall on what I do. That would be a pinnacle moment. 

Joe Mills: I love that because we do keep landing back on identity. And in three conversations in a row, we’ve landed back on identity. And so this season is about understanding what people who go through various inflection points in business, one of them being private equity or late stage venture, some sort of capital influx. Another one’s navigating leadership changes and things of that nature. You guys do a lot of both. It is interesting how it keeps coming back to know who you are and live into who you are rather than rapid decide that you are the business or you are the role or you are the thing. There’s going to be turmoil in it. And if you leave yourself open to something that you don’t control being your identity, everything’s going to break. It’s going to, business is going to go poorly. Your life’s going to go poorly. Like you’re just going to feel 

Adam Ringo: terrible. The reality of this idea of falling in love with the process, if all we do is try to control outcome, we get obsessed with controlling every variable that could produce that outcome. And that breeds and leads to an, a ridiculous amount of anxiety and failure and misfortune and worst case addiction and all these things, right? If we stop worrying so much about the outcome of any one thing, because ultimately, once you get to that outcome, and this is what we talk about a lot as partners, and we hope all of our management teams like, yes, we’re going to set goals. Yes, we’re going to work hard towards them. Yes, we’re going to do everything in our power to live into the things that we need to do and hold each other accountable. This is why I love long term capital. This is why I love Watercourse. This is why I’m not obsessed with some of the other capital models out there. Is that we can coach and train and teach and speak to our people and our teams this way in such that let’s not control that outcome. Let’s do what we can. If we can just fall in love with the process of getting to wherever we’re going. Because at the end of the day, who cares where we’re going? We’ll set goals. And we have visions, but who cares? My kids don’t ask me, Hey, dad, did you meet budget today? They don’t care. That’s a beautiful reminder that I’m not that important. My wife always tells me, Hey, you’re not the president of the United States. It helps us and our teams, and hopefully all of the employees, just like, be who you are, live into who you are, and live into the good that is.

The process in life and that’s why we value things like family and time and we want to pay our people well and things of that nature because at the end of the day, when we’re 65 70 75 years old, our kids, our friends, things of that nature, they could care less. I hope my kids care a lot less about wealth that was created for them and a lot more about who I was as a dad. And that’s what I want for all of our employees. 

Joe Mills: There are two things I’d love your perspective on. I know we’re getting close to sort of Wrapping time. First one, have you found any tips or tricks about how to let go of the outcome without not caring about the outcome? Because we still want to care about it. We will do better work if we care about it, and nobody would say they don’t care about it. But how do we just let it be? But I didn’t know if there were any things that you do that remind you of that or… ways that you practice that because clearly you 

Adam Ringo: work on it. I don’t even know if I ever went into the story, my wife and I, we moved here to help start a church. So it’s kind of an untraditional background, right? I thought I was going to work for an energy bank and trade. Energy commodities, which I ended up trading energy commodities for a while here locally, which is kind of bizarre. But we moved here to Indy from Louisville to start a church because I was just a personal passion and then I stumbled into instead of trading commodities and assessing underlying value of Derivatives I now assess underlying value of company that being the assets of the company physical and otherwise And people would fall in that category. I don’t consider people to be assets per se. I want to quantify or qualify them as that, but they contribute to the business in a really meaningful way. Why do I say that? I say that because there’s some theological things that I believe that act as a tool to Kind of resetting identity and where I find my identity. I don’t want to prescribe that or enforce that. The reality is like, it’s not going to be the truth of all of our 

Joe Mills: employees. What is it about those tools from like a foundational standpoint? Is it that you recognize that the outcome isn’t you? I don’t have to take on the burden of that outcome coming true or not. I’m fine if it doesn’t happen. 

Adam Ringo: The reality is we all know we can’t control outcomes. The world is so much bigger than us. There is so much going on. I mean I was in Atlanta last week at 1030 on a Tuesday and there were thousands of people in the airport. I’m like, what are you guys doing? What am I doing here? But what are you doing here? It just reminds me that this world is so big, so many things going on, so uncontrollable. But we can all self admit that, one, we’re broken people, like we’re kind of messed up. And we pursue self all the time. So some tools are like, hey, stop pursuing self all the time, like care and love and sacrifice for others. Let’s wake up thinking about what we can do for others before Thinking about only ourselves. That’s a good common human practice. 

Joe Mills: It is, but it’s very hard to remember. It’s been put in front of me five times in the last two weeks of like the need to recognize you’re not the center of the universe. And it’s easy to like fall back into it, but I think that for you, it’s likely a faith practice that reminds you of that. And for other people, it could be something else that reminds them of that. But like you said, hey, it’s not going to be the belief of every one of our employees and it’s not how we run our businesses. But I do think that’s important to remember that, like, love, care, and serve other people matters a lot in order to not freak out about the outcome.

Adam Ringo: You just have to understand, like, it’s hard to practice, but easy to know that the outcomes don’t matter. Think about others like first. When you do that, it just allows you to breathe a little bit and puts you at peace. David Homer, he said, hey, in business and in anything, relationships should be our currency. I’ve never lost that because again, in a world where currency is purely monetary, we begin to value everything based on that score of how much money you have or don’t have. And if we started to evaluate things on a relational score, like the relational magnitude or the relational weight or the relational value that we carry with other people. And we thought about that a lot more than we thought about underlying asset value or monetary value, then it’s a lot more fun to do business together. And if it fails, okay, it fails. The biggest thing is if you’ve raised capital to something, it really stinks to let capital investors down and then tell them they’re not going to get their money back. Yeah, that’s not so good. But at the end of the day, what’s the worst thing that’s going to happen to you, right? Reputational risk. Okay. But if you’ve got a solid group of relationships and community and people. The 

Joe Mills: people focused aspect of it, it’s like a refreshing place to end and I think it is very interesting, especially coming from a position of we work in deploying capital, but it still comes back around to people and what’s your identity and how do you manage that and what are you giving to the world and don’t make yourself the center of it.

Adam Ringo: I don’t know how we ended up there, but somehow we migrated there without intention. I like that. That is truly what matters. Sure. We want to be excellent at deploying and investing and building on capital and return to capital. If we did all that without being stewards, according to how we defined it earlier, to the things that we were overseers of.

It’s kind of sucks. I don’t want to wake up there. And so we do a lot not to. Well, Adam, thanks so 

Joe Mills: much for the time, man. I really appreciate it. Yeah, this was fun.

Reid Morris: Okay, Joe. So we’re coming off of our conversation with Adam where we were seeking a bit of a different perspective in terms of how does someone who’s quote on the outside of a leader’s experience experiences them and what are the things that they look for in these leaders in these sort of inflection moments and so what stood out to you as Commonality or any specific thread from that conversation that is something we might want to carry forward 

Joe Mills: One piece just to say is I do feel like we have a interesting moment where we kept coming back to identity again for like the third conversation about this this leadership transition point and so I think we can put a pin in that and say Okay, this is clear that It is very important that you have a clear sense of identity and you know who you are during leadership transition that becomes very apparently important. With Adam in specific, he gave some context and some frameworks for how they think about that. He used a lot of EOS terminology because that’s what they use, but there’s a lot of different ones that you could get into for that, but I think it’s really helpful to understand that. People are not formulaic. We said that to each other in the room during the conversation, but having a starting point for how you can view people makes the job of unpacking all their nuances easier. And that was a takeaway for me, both in terms of when you’re evaluating somebody else, but then also for yourself. We talked about a few of them. We talked about Enneagram. We talked about DISC, those different personality. assessments are not meant to give you free reign to act however you want and just be like, this is how I am, but it’s better to give yourself the framework for this is how I show up and this is how people experience me. So how can I both lean into that and find the strengths of it and also be aware of where I’ll have weaknesses because of it. So I think there’s this ability to start from somewhere, get off the blank page. That the various formulas and frameworks is really helpful for it 

Reid Morris: was validating on some level because over the course of 1,000 Stories so far, let alone this season, as we’ve spoken to business leaders, we have known that there are personal and professional implications and variables in decision-making. But then when we were thinking about getting the lens of someone who’s involved in business transactions. We had this idea of like, well, will that still be true or is it formulaic? Because we oftentimes think about it’s about the PNL. It’s about EBITDA. It’s about all these things. And so it was validating to what we’ve experienced so far that to see from this seat, all of those personal things, all those individual things are still relevant in the context of transactions.

Joe Mills: He talked about the three C’s being chemistry, capacity, and calling. It’s like the chemistry piece is all feeling. Do we jive together? And one of the things that kept going through my head as I was listening to it again and going back and thinking about the conversation is that the two of the three are pieces, they are very subjective. Do we vibe? Subjective. There’s no, check you’re good enough or you’re bad enough or it’s a value statement or anything. It’s do we vibe together. And then the third one being calling, which is like, does this business give you purpose? And it could be for any number of reasons that it does. And then there’s one in the middle that’s capacity, which is really an evaluation of, are you the right person for this seat? We then talked about how people, myself definitely in this one will often look at the skills they don’t have as what they want. And forget about the benefits of what they do have because it seems normal to have what you have. And I think there’s a separation going back to our conversation with Mark. Like separation between whether or not you are quote unquote good enough and whether or not you are right enough. Are you the right fit in the right spot at the right time? I think the realization I’ve had as I reflected on our conversation and listened to it again was those have no relationship to one another. You being right enough and you being good enough do not relate. If you’re not in the right fit, regardless of quote unquote how skilled you are, that’s gonna be a very uncomfortable seat for you to be in anyway, so why do you even want it? 

Reid Morris: It’s very easy to think that as you’re a leader going through a company that is growing, changing, transitioning, that you should do that thing of just, okay, well I need these additional skill sets, so let me go get those. And then, oh, I need these additional skills, let me go get those. Versus the reflection and acceptance from someone like Mark of, these are my skills and my strengths, they might not serve the next stage. And so separating those two things a little bit as you’re making your decisions is a good framework.

Joe Mills: And I think the nuance, the question that just came to my head as you said that is, We also want to grow and develop more skills. So, what’s the right time, wrong time, to be like, ah, I should stretch into this different capability, versus, ah, that’s not really for me. And I think that’s a really interesting thing to consider.

Reid Morris: It brings you to the conversation of what do you build around you, versus what do you attain, versus what do you accept.

Joe Mills: Yeah, and move on from. It felt like a good wrap-up to the conversations that we’ve had around leadership changing. I’m sure they’ll come back up again. It felt like a good buttoned-up way to think about leadership transition at the very top in a good way.

Reid Morris: Yeah, I’m looking forward to seeing where we go as we kind of change our premise here a little bit going into these next conversations.

Joe Mills: 1,000 Stories is brought to you by Element Three with production by Share Your Genius. This show is part of our company mission to foster growth in people and business so they can change the world. Spotify. If you’d like to stay in the loop for more updates from our show and to hear other stories of growth, please head to Element Three. com forward slash podcast.

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