Jim Smith & Rebecca Hurst, Smith Hurst, PLC

When we started the firm, w- Rebecca and I, I, I looked at Rebecca and I said, "Rebecca, you, you build a firm and let me worry about getting the business." Mm. And, uh, because back then, Rebecca, w- how old were you? You were 30- 31 ... 31 years old, and she had created a really good practice. I had a real large practice.

Some deals aren't made to be done. We're not really in the bus- and people don't usually come to us and say, "Hey, here's a deal. Try to break it for me." It's, "Here's a deal. Looks good to us." You know, it's kinda gotten to a point to where the family or the partners decide this is what to do.

But I still think there's, you know, there's a lot of mad g- mad scientists, you know, genius people who just can't quite capture the back office side of things, and I think that's actually one of the reasons we felt like Emerald made a lot of sense, uh, when we were talking about, you know, what we wanna do with it is to be able to provide those back office services because there are so many brilliant people who have ideas that don't really know how to run a business too.

So I think there's a

lot more that goes into having a successful business than a lot of people realize at first blush.

You've gotta have a client who understands the role of his team, who understands the role of the attorney, who understands the role of the accountant, who understands, you know, the role of the other side.

Uh, and you've gotta have a good rapport

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All right, good afternoon, y'all. Good afternoon.

Um, Jim Smith, Rebecca Hurst, um, with Smith Hurst, but also Emerald as well. Um, and we'll get to both of those.

Um, appreciate y'all k- letting us come up here in Pinnacle in your office. Um, really curious to kick u- kick us off here, y'all's perspective on the family office in Northwest Arkansas, how it's evolved over the last 15 to 20 years. What does it look like now versus what it was like, you know, 20 years ago?

That's a great question, and I know that's one that's right up my alley because, um, it's centered to my practice as an estate planner and family office attorney. Um, we didn't really see family offices to a great extent other than, I would

say, our Pinnacle, uh, large, big three kind of family offices- Yeah

that we, we've always kind of seen in Northwest Arkansas. Um, but the es- um, evolution of p- uh, family offices, I think has come about as not only as the wealth has grown in Northwest Arkansas, but also as just opportunity and realization that there's a need for more organized management and structure of how you run your family investments and run your family as a business.

Hmm. Um, and so it's really developed, um, in that respect throughout the last 15 years. Um, I think there were probably more family offices than people realized, and the term just got- Wasn't there ... a little buzzier. Yeah, yeah. Uh, honestly, and I think there, it's just become more prevalent in terminology as well, in our area especially.

Is there a definition for the term now? I mean, like a, like a-

I don't know that there really- Yeah ... is a true, you know-

Yeah, size of family or

whatever- Yeah ... maybe ... definition. Yeah. Um, it's really just, you know, operating your family as a business. As a business.

Yeah.

Yeah. That's what it is. And a lot of people were doing that without realizing they were doing it.

Mm-hmm. Is there a level where it does or does not make sense to do it? I'm sure that's a question you guys get, like-

It is a question we get a lot. And, um, I w- I always kind of say, you know, if you've got somewhere between 50 and $100 million of, um, assets, it's time to have the conversation. Um, at that point, it may be that a multifamily office is a little bit more appropriate because you do have to staff, and you have a lot of compliance that you have to worry about and a lot of other issues.

And so, um, it may be that it doesn't make sense below that level. Um, but it, it really is dependent on what everybody's goals are and desires within the family office structure too.

Well, let's talk about, um, y'all, y'all, where you from, your stories, and, uh, and kind of the, the origin of Smith Hurst.

Do you wanna start?

You want me to-

Yeah, you bet. Well, I was, uh, you know, I'm originally from Russellville. Grew up in Russellville, was a Cyclone and all that. And, and, uh, when I finished high school, went to school at Arkansas

Tech. I went and played, uh, baseball there- Mm ... and, uh, got an accounting degree. When I wrapped up getting my accounting degree, I came up here to, uh, first time to, you know, northwest Arkansas, and got a, uh, law degree, and graduated in, uh, the early '90s, 1994, from the University of Arkansas School of Law, where I'd focused on corporate and business-type work.

I knew I wanted to do deals. I knew I didn't really wanna be a litigator. So after I wrapped up, uh, at the University of Arkansas School of Law, went to New York, uh, New York City, and I got a master's in tax law from NYU. And then I moved back to, um, to Little Rock to work for Friday, Aldridge & Clark, which was and continues to be the, the largest law firm in the state.

Uh, worked for, um, a gentleman named Byron Eisman, who's a absolute legend in, in the tax practice, not really only Arkansas, but regionally. Um, learned from the very best of the best. And, uh, but

also while I was working there in Little Rock, we didn't have an office in northwest Arkansas yet, and so we were working in, in Little Rock.

And I really learned from, from some amazing, uh, attorneys, as you would expect in a really high-level transactional practice firm like the Friday firm is, that also, you know, is, is a well-rounded, uh, full service law firm, m- unlike Smith Hurst. But got to work with Byron and, and Skip Ebel, who really was my mentor, and Price Gardner and Lee Brown and a lot of these really outstanding lawyers that are still very good friends of mine.

And in 1998, um, the Friday firm started talking about opening up a northwest Arkansas office. They ca- It's a funny story 'cause they came to me and, and Cliff Plunkett and Jason Hendren, and they said, "Hey, we're thinking about opening up an office in northwest Arkansas, and we wonder if you guys would like to go up there and give it a go, try to start it out."

Uh, and they said... And again, this is almost 30 years ago. This is 1998. And they said, "You know, we know that the big heyday, the big, uh, boom time period of northwest Arkansas has already occurred, but we think that-" "... it's gonna be a strong, you know, strong, uh, area of practice. It's gonna provide a, a good growth and good opportunities going forward."

Of course, you know, we, none of us knew what was coming- Yeah ... to northwest Arka- the, the stuff that's outside our window. And I said, as a deal lawyer, I was practicing in mergers and acquisitions and corporate finance and corporate law and things of that nature, and I said, "You know, I don't really think-" that there's a lot of business up in northwest Arkansas.

I don't really think that, I don't really think I'd have much of a robust practice in, maybe in litigation, but in the world that I live in-

There's

not

a

lot of

deals up there ...

I didn't really

see it. Yeah.

Yeah, there's not really any deals. And they said, "Well, why don't you go up there and give it a look?"

And so in the fall of 1999,

I came up here, uh, to, um, to a football game And it was the Tennessee football game, and we beat 'em at the end of the game. We tore down the goalpost and took 'em down to Dixon Street. Put 'em up- Yeah, put 'em up ... on the hogs. Yeah, yeah. On a brewery, brew pub. And, um, I said, "Yeah, you know, I think things have changed a little bit."

"I think it's a pretty cool place." Yeah. "So come up here." So August of 2000, uh, moved up here. Uh, and Cliff, uh, Plunkett and Jason did as well, and we started the Friday firm in the, down in a little, little office down in Fayetteville. And, um, we, we... Cliff was actually really involved in the American Airlines.

There was a crash in Little Rock, and Cliff was really involved in, in that case. We were defending American Airlines in, in, in that case. Or, or not, not defending American Airlines, we were representing, um, some of the people who were injured in the case. Mm-hmm. And, and that was a full-time gig with Cliff, and Cliff was really busy doing that.

And Jason was, was

from here, and so he was getting involved in the community, and I was new here. So started working up here in August of 2000. And, um, you know, obviously I had three clients when I moved to town. I had a company called Thompson-Murray. It was Andy Murray, who's still a great friend of mine and, and you probably know him.

I mean, Andy's really well-known up here, but he, he and Mike Thompson had a firm, had a digital marketing or agency called Thompson-Murray that we sold in 2004 to Saatchi X. Mm-hmm. And it's now Saatchi X. And Andy's had a, a esteemed career. He's kinda famous for, for turning shoppers into buyers is kinda what, what made Andy, uh, who Andy is.

He's a great story, great founder. Uh, talk about somebody who'd be really, really good to have on your show sometime. Um, Andy is, uh, is an outstanding person and has had an outstanding career. Went to Walmart after that and has had various other things. So I've got to work with people, um, throughout the years and, and found roles and in

entrepreneurial roles.

So, uh, I'll let Rebecca talk more about, you know, what she did to, to get where she was. But in, in a nutshell, in 2011, 11 years after started the firm, and she started at, at Friday in 2005, uh, I was 42, and I had the bug to be an entrepreneur and to have my own gig and do my own thing. And I said, "At 42, if I'm ever gonna do it, now is the time."

Mm-hmm. I don't really wanna do it when I'm 52. Uh, and I'm 57 now. Uh, so, um, I went down- There you are ... I went down to Rebecca's office. I said, "Rebecca, I think I'm gonna go start my own firm. What do you think about, would you wanna do that?" And she said, "Well, what's the firm's, what's the name gonna be?" And I said, "Well, I guess Smith Hurst."

And she said, "Yeah, sounds okay to me." Sounds good. And, um, so we, um- We did, uh, we did that in 2011. Mm-hmm. Started out on Dixon Street in Three Sisters building. Yeah. Um, right above, uh, w- it was called Fix. Fix. It was called Fix and then-

And Cannibal and Craft ...

Cannibal and

Craft, and Ben's Apartments and- Yeah

all that fun stuff's going on, and we're practicing law, you know, upstairs. We have balconies and all this kind of stuff. And then in 2017, we just noticed that there was more work. We were up here more often in Northwest Ar- uh, up in Bentonville Rogers. And I said, we always talked and said, "You know, I think it'd be good to have a satellite up in Bentonville- Mm

or Rogers or something, and let's go up there." And so we looked at Miss Hunt's tower, which we're in, and we took a little small space on the eighth floor. I was scared to death that we weren't gonna be able to afford it, and, um, and came up here, and in about two weeks I called her and I said, "We really need to go ahead, just move everybody up here.

This, this place is really- It's happening ... amazing- It's burgeoning ... what's going on up here." And so we moved up here in 2017, and we're down on the eighth floor, and New Road Capital, which is a really strong, kind of the leading private equity firm up here,

was in this space. Mm-hmm. So when they left this space, we, uh, migrated up to, um, to this floor.

We've had some interactions in between and some things that we've done differently over the years that I'm sure we'll get into, but in a nutshell, that's my background on how I got to where I am today here. Hmm.

So what about you, Rebecca?

Very good. Say, I don't know if you want that long, the long version too.

Um, no, I, I grew up, um, I was born in Arkansas, but my dad was in the military when I grew up, so I've lived all over the place. Ended up, um, back in Arkansas, um, and have an accounting degree as well. My, my path is a little, is rather similar as far as education-wise, uh, to Jim's, but I have an accounting degree, and then came up here, um, here to the University of Arkansas for law school.

Mm. And then went to NYU for my tax LLM as well. Mm. Um, I was hired by Jim, uh, to g- um, for the Friday firm because he, um, was having to do too much estate planning work, um, basically having to take meetings with, um, estate planning clients to send the

work down to, to the Little Rock office, to the attorneys down there to actually do the work.

Sure. And then, um, end up having to have those meetings, and he said, uh, "This is very disruptive to my practice, and I either want to hire somebody or we are no longer going to be- Doing that ... doing estate planning in Northwest Arkansas." And so, um, thankfully for me, he s- they, uh, went the let's hire somebody route, and, um, I got hired to do estate planning and kind of started their practice up here- Mm

um, in Northwest Arkansas. Um, went to NYU, as I said, and then came back and started that practice. Worked there for five or six years, I guess. Um, and then we s- started Smith Hurst, and I guess the rest is history, as so to speak.

And what, and what was y'all's competitive edge when you started? What was the, was the

offering?

Relationships.

Yeah.

I think it's all about relationships. You know, when we started, um, our firm, you know- The Friday Firm's, um, um, such a big name in the state, and w- a lot of, there was a lot of concern that do you have those

clients because of h- uh- The firm? Yeah ... the firm you're at, or is it because of the relationship you, ship you've built?

And we saw very quickly it was because of our relationships. Um, we moved 738 files- Mm-hmm ... I think, in the first two weeks. Um, clients own their files, and so I think a lot of people don't realize that. It's not that you just get to instantly trans- transition business. Mm. You have to have a client ask you to be able to do that, and so we had- Mm

that many files move with us, so it was great.

Well, the biggest thing that happened, uh, was when we left, we were, uh, we were in the middle of a transaction, uh, with Rockfish with, uh, one of our really good clients, really good friends, a guy named Kenny Tomlin. Mm. And Jeremy Wilson, again, Jeremy is, uh- My former partner

w- was one of the founders of New Road Capital. And, um, and Kenny was, uh, uh... And Steve Clark, um, had a company called Rockfish. Mm-hmm. And it was a digital agency, and they, uh, were acquired by WPP out of London,

which is the world's, um, largest buyer of media at the time. And, um, when we left to, um... We, we were gonna complete the transaction at Rock, uh, or the Rockfish transaction before we left the Friday firm, but events didn't allow for that to occur.

So, um, when we left the Friday firm and, uh, reached out to Jeremy and Kenny to tell them that we were leaving, uh, they decided to come with us and have us do their deal. And, you know, so the good fortune of, of having, um Kenny and, and Jeremy and Steve, uh, sign up-

Out the

gate ... with us- Out of the gate. Yes

to do the gate, to do the deal out of the gate, gave us a... Not only did it provide financial a- ability to, you know, come out of the gates really strong, but it gave us even more confidence than you might other wise have where somebody that you've established a relationship

with that said, "Yeah, we're, we're good.

We'll, we'll see you later but we're gonna go ahead and use this firm to do this." So we, it was a real shot in the arm. It really meant, you know, it was one of those seminal events, not only in the, not only in the firm, but in our, in our life to, to have the confidence of, of those type of people to, to come over with us.

Oddly enough, the day we closed, um, the Rockfish or the, the, the, uh, the, the Rockfish transaction, we were hired by Ike Thrash and, um, Sam Ally to buy the... It was, at the time, it was the- The- ... Cosmopolitan Hotel ...

Cosmopolitan Hotel, which became the Chancellor Hotel- Mm-hmm ... which is now The Graduate Hotel. Yeah.

Yeah. And so that hotel- Mm ... had gone through a lot of disarray. Mm-hmm. Um, and Ike Thrash, who is a hotelier across the country, lives in Hattiesburg, and Sam Ally, who's in construction down in, in, um- Little Rock ... Little Rock, and he's a legend in his field too. They called us to do that transaction. We did that

transaction with, um, new, federal new market tax credits.

And so as soon as we wrapped that up, then we start going into a company called Acumen Brands, which was Terry Turpin- Yeah ... and John James. And, uh, we put that company together and worked with them. Um, and then they had a series of transactions, including in 2013, a $83 million capital investment- Mm ... from General Atlantic, which was one of the top five biggest private equity deals in the first quarter of 2013.

And so we had a lot of just really good luck. In addition, we were good, r- I mean, we're good at what we do. Uh, and you've got to have s- good skills, but we were fortunate to have a lot of good luck, which is- Good timing ... what you... And, and we've created that l- some of that luck, and some of that luck we just got by showing up or being at the right place at the right time.

But we had a lot of good fortune. But again, you know, starting Smith Hurst was not- I mean, we had been up

here for 11 years, and we had really created relationships. We had grown as the community grew, as the transactions practice grew. Um, we had worked with really good founders like Henry Ho and Rick West, who had a company called Field Agent that is now Storesight, that has- Yeah

become a significant, um, AI, uh, company in shopper marketing and in, and in, uh, mystery shopping and in audits, CPG, and, and they're going into that building right there. Yeah. And we're gonna have a board meeting. We're, we put the... worked with those guys since 2013, and, and they're neighbors now, and we've got a board meeting here in this office in a couple weeks, so they can showcase that space.

And they've got privity, uh, private equity background, or money- Backing, yeah ... from Five Elms Capital in Kansas City, and-

And how do you balance the, the back and forth of, like, running a transaction for your client and then also, like, maybe taking too much control, hey, taking the reins?

I feel like outside looking in, one of the more challenging things if, if I was in your shoes would be, uh, you know, getting myself inside of the business, business, 'cause they're all so totally different.

The, each-

Well, when I, when, when we started the firm, W- Rebecca and I, I, I looked at Rebecca and I said, "Rebecca, you, you build a firm." And you be the managing partner, and you build the business that we're gonna have, and let me worry about getting the business. Hmm. And, uh, because back then, Rebecca, how old were you?

You were 30- 31 ... 30, 31 years old. And she had created a really good practice. I had a real large practice, and I felt like my clients- Mm ... our clients were going to work with us. And, and they were at points at, at the time to where they were gonna grow. Hmm. And you could tell companies that were gonna grow.

And, um, so we... So, so I said, "You focus on building out the place," and she built a, has built a great firm. She's been the managing partner since day

one. Um, and then we hired Kristin Baldwin, who really is our COO. She's the one who runs the business aspect with, with Rebecca. Um, and I... That allows me to focus on, on working with clients and, and doing deals.

And then, you know, we've had, had the good fortune of having really strong attorneys through the years that have been able to do projects with us, and some of them have gone on to bigger and better things, and, and we're real happy for them and real proud of them. But we've got, we've always had really good talent- Oh, yeah

you know, to work with us, and that's... I mean, I'd, uh, I would say that if she wasn't here, but a lot of it is because of her leadership of the firm and, and an ability to, uh, to know who to recruit and who to hire and how to take care of them when I'm losing my mind and, uh- ... on a video or in a meeting or something.

That, that's amazing.

How, uh... So you said, you said companies that were on the precipice of growth- Mm-hmm ... is, I'm paraphrasing. But

how do you know when a company... I mean, you guys have seen a ton of companies through- Yeah ... M&A over the years. So- I'm sure you have a better definition of that- Mm-hmm ... or a clearer picture of that now, 15 years later, than you did when you started the firm.

It's funny 'cause, you know, uh, we laugh because there's a lot of clients and transactions that they'll go through a exit, and it's really just kind of a we need to shut this, shut this down or find a way, basically a parachute to- Yeah ... to move on, um, kind of transaction, and we end up making more money as attorneys than they did in their cl- Yeah

in their actual exit, which is horrible. I mean, and that's not the e- exit that anybody wants. Um, but it is kind of, um, interesting, you know, you think that you see these entrepreneurs who have great aspirations, who have great talent, great potential, and y- yes, poten- I mean, potential's there, but it doesn't always translate into operating a good business.

And so I, I don't, I mean, I think we have a better feel for it now than we used to, maybe, but I still think there's, you know, there's a lot of

mad ge- mad scientists, you know, genius people who just can't quite capture the back office side of things. And I think that's actually one of the reasons we felt like Emerald made a lot of sense, uh, when we were talking about, you know, what we wanna do with it, is to be able to provide those back office services because there are so many brilliant people who have ideas that don't really know how to run a business too.

Mm. So I think there's a lot more that goes into having a successful business than a lot of people realize at first blush.

I- When I think ... yeah, I mean, I don't think I can, I don't think I have any secret sauce. I mean, there are companies that I have worked with that I absolutely would've thought would've been very, very successful that it just didn't pan out.

I have had companies that I have worked with that came in and I said, "There's no way this thing is going to Be anything special, and they've just knocked the bottom out of it. Mm-hmm. And just have been, you know, become global companies. That's very true.

And, uh, so I mean, I don't... I, I, I think the key is for, for companies, though, I think if you have any chance of making it, is you've gotta have some real stick-to-it-iveness.

You've gotta, you've got to understand that it's got... You've got to, like, you've got to enjoy what you're building as much as a hobby. Mm-hmm. Because it's gonna require that. I remember when I was... When I first started the practice of law, the, the, the gentleman who ran the Friday firm was a guy named Buddy Sutton, who was...

Kinda had a aura like Ronald Reagan. I mean, he was just- Mm. He was a big, strong former Razorback football player, and he was just a strong man that you really rallied for, and you didn't sh- certainly didn't wanna let him down. And it wasn't because he was a hard guy, it was just that you had a lot of respect for him, and I had, had a lot of respect for Mr.

Sutton. And he told us early, you know, at this... He was not a crass

guy at all, but the one thing that he said that was r- r- that I think has come true is, he says, "You know, the law is a jealous mistress." If you think of that, it's like, you know, it's gonna consume your time. It's gonna s- consume your effort, and I think that's the same way about businesses and people who are really, really successful in business.

They've got great ability to delegate. They've got great ability to make decisions. But in and of themselves, there's more to it than just a gig or just a job or just a- Hmm ... career. Mm-hmm. Um, to be a real... In my view, and the type of people that I really like to work with are, are people who are really bought in.

And you can tell that there's more to it, what they're doing, it's more to it than just what it is to most people.

Yeah.

Mm-hmm That's awesome. So talk about starting the firm, 2011. It sounds like you guys had a, a first client right out of the gate. Mm-hmm. Did you guys have to bring capital to the table?

For someone who's like,

"What does starting a, a law firm look like?" I mean, what, what does that... How does that start?

So we took out a line of credit, uh, when we started, about, oh, $250,000, I think. Get out on

September 1,

2000- Took out on Sept- ... 2011 ... yeah, in the beginning of, uh, the firm t- in 2011. Um, we drew down on that to be able to get our, um, offices finished out, get all our furniture, our equipment, everything that we needed, um, and lived off of it just for a little bit while we were k- um, moving through with these initial transactions.

Um, and then took our last draw on that in January and paid it off by the next August. So-

Yeah, paid it off the Thursday before- ... the, before our one-year anniversary ... our one-year anniversary. We've never borrowed a cent- And,

yeah, we've been

very, very fortunate in that respect ... in 15 years. And we probably could be two or three or four times as big a firm, um, had we- Mm-hmm

kinda done leverage. But you know, the thing about the practice of law is, um, you know, it's hard to create enterprise value in a, in a law firm. Yeah. I mean, it's all

based upon the services and the people who are doing those services. So it's not one... It's not like real estate where, where you wanna go, "Let's put 40%...

You know, 50% equity in and 50% debt." Um, we have been able to benefit from not having debt, uh, which in a service company... And, you know, we've, we, uh, try to pay for everything out of, out of operations, and we... It gives us a bit of latitude to be able to do the things that we wanna do, uh, for growth or for, you know, taking on projects.

And-

Yeah ...

so yeah, but we're like everybody else. We, we borrowed coming out of the gates. And, you know, what's funny is all the things that I worried about when I was figuring out whether or not I was gonna, you know, leave a extremely successful, stable, secure, uh, employment partnership with, with, with the best firm in the state to go out and do your own gig, um, all the things

that I worried about, none of them were ever a problem.

Well, am I gonna get clients? Are we gonna make money? Are we gonna, you know, survive? Um, those weren't issues. The issues were things you don't know about when you're not a, running your show, which is HR, and how do we get talent, and how do we get help, and- Mm-hmm ... how do we, you know, get insurance? Yeah, insurance and- How do we set up a 401?

And, you know- Postage and ... those sorts of things. Yeah, yeah. Postage. All

the random things.

All that sort of stuff. It's, it was all the things you don't know, but that's part of it. That's the... We, you run on adrenaline for the first couple years, and- And figure it out ... and hope you've got it figured out by the time it becomes a g-

you know, becomes, you know- Becomes, becomes an issue. So ... pro- you know, a More work. Yeah.

That's right.

And then when you started, it sounds like M&A was your f- was that, I mean, 100% of the practice?

M&A and corporate and Rebecca's, you know- And then estate planning ... estate

planning. And not, I do not do the profit work.

Mm-hmm. Okay. So from the beginning, the services haven't super changed. Um-

Um, I would say the services overall haven't changed. Okay. My practice has changed just because I do more M&A

and, um- Mm ... business corporate work than I did historically, but a lot of that's come from the family office kind of practice as well, with the clients needing that, um, from that perspective, and then working with, um, Jim more extensively, um, on some of his transactions as well, so.

Yeah,

I mean, when, you know, historically, when, when you look at Arkansas as a rural state, um, you're usually on the sell side back in the day of mergers and acquisitions and corporate formations and corporate transactions and general contracts, you know, covenants not to compete or distributorship contracts or things of that nature.

What has changed is, um, as Northwest Arkansas has grown, we're more on the buy side transactions now. We do represent a lot of companies that are scaling, that are growing, that are buying companies. Um, but, but what has really taken off in the last, since 2016, 2017, was private equity and venture capital.

Yeah. When I started practicing law, you know, you hear the

name angel investors now, you hear all the, the angel investors kind of start putting money into companies and things of that nature. When I, when I practiced law back in the late '90s and the mid-'90s, it was the FF&I round. It was the friends, families, and idiots.

And somehow idiots got converted into angels. Uh, but, but the theory's the same. I mean, it's, it's- Sure ... big risk- Yeah ... big reward. Yeah. And, um, so what has really changed and where we see things going more and more is, is funding, you know, companies. You know, a big part of that, you hear all kinds of things.

Like there's not enough money to invest, or there's not enough engineers or enough talent, um, or there's not enough executive leadership. Really- What didn't exist for a long time was the ability to point to things that were successful companies. Yeah. That was a successful company. You know, Rockfish, Thompson, Murray, Acumen,

um, Field Agent, you know, these sorts of company.

RevUnit- Mm-hmm ... AcreTrader. A lot of these really, you know, forever it was like, "Well, who- your ecosystem, show me some successes." And it's like, well- Walmart ... Walmart.

Get the hunt. JB Hunt. You

know.

Tyson.

But we're now at a stage, we're now at a, at a stage to where there is some signif- there's not only some significant exits and some ex- significant transactions that have occurred, but those people, when you look at Nick Dozier, you look at M- Michael Paladino, or, or, or you look at Rick West and Henry Ho, or Andy Murray, or Kenny Tomlin, or Jeremy, these guys have gotten...

They've dove back in and they're doing... Not only are they doing their own things, but they're helping grow- The rest of the ecosystem and the rest of the economy. And then you see what the Northwest Arkansas Council's doing, and Onward HQ, and some of the venture capital, you

know, organizations like Highway Ventures and, and of course what the Waltons do, not only with the Walton Foundation, but with the Walton family, you know.

Sure. And what they do to enhance the community. Um, and then Miss Hunt, of course. We've, we've watched Miss Hunt build all these buildings around us, um, and fill 'em up with vendors. And people, I think, sometimes don't pay attention to kinda the, what the vendors do to Northwest Arkansas. You know, they're the sales group.

Their home headquarters are still in Cincinnati or Chicago or New York or wherever they are, but they've got significant talent here who are involved and, and bring their expertise from other parts of the world. You know, I live next door to, uh, to Eric Brewer, who's kinda head of Hershey's, and he used to be at Bain Capital and, and, um, has experiences from, you know, being in, in Dallas and Texas- Yeah

and those sorts of things, and it's really cool. You've got that

cool vibe, you know? Yeah. We're not a clubby, we're not a clubby region. We're a region that's built on trying to accomplish things. And while you do have multi-generational families here, you really have more folks that are moving here that don't have any real heritage here, that know what they like and know what they're used to seeing.

They want really good healthcare, they want really good education, they want really good access to arts and sciences and, and things of that nature, and that's all ... And so that's all coming here, and we're all benefiting from that. And, you know, I think that's what, what gives us, that's another reason, you know, that we started Emerade is Emerade's not a foreign type concept in big cities.

Uh, it may be a bit of a foreign concept to Northwest Arkansas, but it won't be for very long, just knowing this, where we're, where we're headed in Northwest Arkansas.

Yeah, and let's pause on that. I wanna make sure we, we talk about all, all the MNA side very first. What,

what, what do people look for in a good M&A attorney?

What it, what separates the best from ... Besides, "Hey, I'm gonna get the best price if I'm selling my business," or, you know, "I'm getting the best deal."

You've gotta have a client who understands the role of his team, who understands the role of the attorney- Sure ... who understands the role of the accountant, who understands, you know, the role of the other side.

Um, and you've gotta have a good rapport, and I think that's what Has helped us succeed is we take our work really, really seriously. We just don't really take ourselves too seriously. And I don't mean that it's slapstick or anything, but, you know, we're, we're hired to be objective and to have experience and to be able to gain the confidence of the client to help them migrate through a very challenging or a very different transaction or part of their life.

Most of my clients, um

It's just by nature of, of being the type of clientele that I work with have only invested in themselves. Every dollar-

Mm ...

that they've earned, no matter how rich they are or how not rich they are, their money's gone back into their family or it's gone back into their business. And, you know, you don't migrate.

You don't... I mean, some people I presume do, but if you really start from scratch, then you're always kind of looking over your shoulder that, you know, uh, you know, i- is somebody coming up to get what I've got? A lot of people, you know, including myself, sometimes suffer from imposter syndrome. Am I really, you know, who I am perceived to be?

Um, and so you, so you wanna hire somebody when, when it's something that keeps you up and it's something that you're not used to, and it's something as

significant as changing how your family makes a living or what they do, you wanna have somebody that you feel like is on your side and that has experience, um, understands where you're coming from and what your experience is in doing this type of work, and then has the confidence in you to let you try to, you know, get a, a deal done.

Mm-hmm. Some deals aren't made to be done. We're not really in the bus- and people don't usually come to us and say, "Hey, here's a deal. Try to break it for me." It's, "Here's a deal." Mm. "Looks good to us." You know, it's kind of gotten to a point to where the family or the partners decide this is what to do, and you kind of go through, through that with them.

You know, David Solomon with Goldman, who heads up Goldman Sachs, said about a year ago now, he said, um, 90% of the IPO process, the

process that used to take six weeks, 30, 40 people working 24 hours a day, seven days a week, can now be done in four hours by AI. It's the first 5% of the deal and it's the last 5% of the deal that really change the, the transaction and, and where you really earn your, your, your merits in being able to do a deal and to be able to pull it off.

And, um, and, and most people don't want to pay you- To do, draft the documents or, you know, create fights. They're wanting to pay you to advise them on what's appropriate, what's not appropriate, what's normal, what's not, what I'd do with this. And that's really the secret sauce, I think, of, of Rebecca's and my practice, and kind of why we put the, the firm together, was I would have a history of, of helping companies, you know, building companies, or working with their boards, or working with their teams, and all that sort of stuff.

And Rebecca would

be representing all of these people i- in their personal life, in their estate planning and, and, and those sorts of things. And so by nature, a lot of times we would sell a company, and I would already have turned it over to her to work with what happens on the other side. I used to laugh because I think a, a really good example, what's the difference between an M&A lawyer, a really good M&A lawyer and a really good estate planner?

Um, is I used to get scotch for Christmas from friends and from clients and, you know, all that sort of stuff, and Rebecca would get homemade cookies and flowers. And, you know, the, the... But the, you know, and, and- The sweet couple that- And, you know, they'd hold her hands- Yeah, that's right ... and come in and do all that sort of stuff.

And- Yeah ... you know, I think what that, you know, it's, it's a different relationship. And, and, um, and, and some of the stories that, that we've had in this town are just, you know, there's a reason that attorney, that there's a

confidential attorney-client privilege- ... which is if not, all the best sellers would be, you know, okay, let me start telling you the stories of people who have come in here into things.

I mean, it's just, you think of, of, of, um-

A lot of

interesting stories ... of, of a lot of- Yeah. But that's, that's kind of the dichotomy, and that's how we always do it. What, what I miss about M&A of the late '90s, you know, now you do DocuSigns. Now you close a-

It's

so- ... $500 million deal- It's so anti-climatic now

from Mexico. I'm sitting in an office and I'm clicking a DocuSign, and back in the late '90s, you know, or early 2000s, you know, I'd fly to Chicago or I'd fly to New York, and we'd spend all it, we- you'd go into an au- you'd go into a boardroom and this, there'd be three of these tables, and they would just be filled with manila folders of people to sign documents.

Mm. And, um, and, and then you go out and you blow it out, and every... I, I live in a world of M&A, so everybody's

happy. It's not like- Yeah ... it's not like litigation where somebody wins and somebody loses. Yeah. Everybody- Yeah ... does that stuff all day long, fighting- No winners ... back and forth and pull it off, and 2:00, "Is this closing or not?"

And of course it's gonna close and fund and all this sort of stuff. And then you go to these big restaurants, and you have these massive closing dinners, and you don't do that anymore, and I hate that. Mm. Yeah. That, that was a lot of fun. And so we still try to do those things. We'll have closing dinners, and we do deal toys and do, do...

But that may just be because I'm back from that era, but it was- Fun era. That's good. Those were the good old days.

That's fun though. Yeah.

It's still fun to get deals closed.

Mm-hmm. It is. Talk- But it is less... I say it is l- m- much more anti-climatic now just to push- Yeah ... DocuSign and then release signatures.

It's not quite as much fun, so.

Talk about that side of the business maybe a little more in depth for someone... So we're talking about deals. Mm-hmm. Like, someone who's not familiar with that, like, when... O- obviously every deal's different, but when do y'all usually get brought into the process? If

there's a broker or there's brokers involved, if there's private equity sending emails to owners that come to you, like, when...

What's the s- kind of most common route for someone to engage with an M&A attorney? And then maybe, like- How do y'all get paid? Is it, is it a percentage, or is it just a flat fee, or it's kinda depends on how complex the deal is? Just talk a little bit about that part of the business. Want me

to start?

Yeah.

Okay. So, um, we usually get brought in when somebody is think- two different, kinda two different scenarios. Either, one, somebody's thinking about selling their business, so they're looking at what, just let's talk through the process. How does this work? And just kinda getting comfortable with the whole concept of saying, "We know you guys do M&A.

How does this work?" And so it may be that they've already kind of talked to a broker, it may, they may not have. But it's working through the whole process of, you know, we've got these different people who are interested in our company. We know, what do, what do we do now? And so it's t- coaching them through, well, you need to get a nondisclosure agreement.

We need to get an

NDA in place. Make sure, before we even continue those conversations, let's make sure we're protected. Then working through the letter of intent. Have we gotten an actual offer on the table to be able to go through? And so ideally, it's at that, you know, at that early stage so we can help shape the letter of intent, um, to be able to say, "These are the terms that we're going to move forward with towards a actual purchase."

Um, any time we can get involved in that early stage, it's fantastic because there's so much that can be easier if we can negotiate it in the letter of intent stage when it's still kind of early and we're kind of working through, um, initial structuring. Um, that's, that's always great. Um, otherwise, you know, we do s- it, sometimes we get involved when they're like, "Okay, we've signed a letter of intent.

Let's, you know, we need, now need to go thru- go ahead and have a contract put together and go through the process of, um, actually, um, structuring or working through and moving

forward with this transaction." That's less ideal because then we're kind of bound with what they've already agreed to. Yeah. Um, in that respect, but it does happen a lot, um, a lot more.

And especially in this age of AI, people think that they can, um, work through these kind of structures. I had a situation just recently where we basically had to go back and restructure a transaction because it was not tax efficient for our client. They just, they had signed LOIs, um, saying that this is how they wanted to do it, and when we started talking about it, I was like, "This doesn't make any sense for you guys."

Hmm. And so we backtracked and thankfully had, had a seller that was willing to work with us on restructuring the, the overall transaction. But it, that, um, typically is better when we can get in early.

You know, and we're not litigators. No. And so, you know, we- We, we do, we, we do deals and we do financings and we do lending and we do estate planning, but we don't do litigation.

And we knew w- when we came out of the gate, we wanted to be able... We, we take a, a

good effort to keep our clients out of court, not because passivity or anything like that, but, but truly business people waste a lot of time and a lot of money and a lot of risk to their company when they're in a courtroom.

Mm-hmm. But what we wanted to do was if we ever needed expertise in litigation, that we could go get the best lawyer, the best litigator for our client for that particular matter. And so if you've got a commercial dispute, we had... We've always had the best lawyers, we feel like, that we work with, that work with us kind of at, like a ancillary of, of our firm.

Um, because we, you know... And, and, and the flip side is they don't see us as competition. It's not like, well, if we send them to do a deal- Mm-hmm ... then they're gonna end up taking our litigation business or our general business or that, that sort of stuff. And so we get a lot of

referrals from, from law firms.

Um, we get a lot of referrals from, from our clients. Most of the cases, most of the deals that we get are because somebody has spoken to one of our clients, and they said, "You really need to..." Or, or an accounting firm or an investment advisor, and they'll say, "You really need to go talk to these guys. These guys, this is what they do."

Um, and then also a lot of the... You know, what are really rewarding is, is when it's a company that you've worked with for a while and you've been in the boardroom. And you know, when you're a, when you're a corporate or you're a business or you're an M&A lawyer, you know, you start out with the legal a- you know, they come to you for legal advice.

Yeah. But once you get that behind you, you migrate. It just evolutionary, you move into business strategy. Mm-hmm. And so some of the most rewarding thing, I tell people I get, I get brought in 15, 20% of what I do is

really technical legal stuff, and the rest of the stuff is business strategy or deal strategy, um, and, and how you go through those things.

So it's really rewarding when you've worked with a company for a decade or five years or, or whatever, and you do get to the goal that they wanted, which is, you know, people start, uh, reaching out to them. And most of the time you kinda know who, who's most likely to acquire you or do those sorts of things.

Mm-hmm. And, and it's rewarding, rewarding to see them accomplish their goals, and you get to be part of that. Historically, we have only charged by the hour. And the reason we don't charge success fees and we don't charge percentages, and the real reason for that, honestly, is that, again, we want that client to know we don't have a vested interest, personal vested interest in the deal.

Mm-hmm. And that what you're gonna get from us is real

Uh, advice that we believe is in your best interest. Um, we may tell you what we would do, but at the end of the day, it's your decision, and we're there to help you make a decision with your eyes as wide open as you can based on experience and those sorts of things.

Uh, but-

We don't, we don't want people to feel like they have to close something just because- Yeah ... you know, we'd get paid, you know- Yeah ... we don't want that- We

don't want them to feel like- ... taint that way, like we- ... that they're at risk that we're not giving them- The best advice, yeah ... sound advice and the best advice because we don't get paid if they don't- Right

close a deal. That's, you know, and, and there's enough success fees in that when you look at brokers and advisors and other finders and things in that deal that we, we do try to bring a sense of objectivity and experience. Um, and now that, you know, that does start

to change as you start having more infrastructure costs with AI and, and things of that nature, but so far we haven't factored that in.

What's funny about AI is everybody said, "Are you thinking that you're gonna put us out of, you know, that AI is gonna put lawyers out of business," bless you, or, or anything like that. No, what we've noticed is, is AI, the AI that we use, which is the same stuff that the big firms use on the coast, uh, or in New York or in Boston, um, is that it allows us to focus on, on, uh, what our skills are.

Mm-hmm. Again, you know, less on document drafting and more on strategy and, and, and the things that really resonate from our experience. And so what we've been able to do is more work. It makes you more efficient. And, and, and it, it makes you more efficient, but it allows you to do more work. So it's not like, um, I'm working, instead of working

10 hours a day, I'm working five and I'm still billing you for 10.

I'm still working 10, I'm just doing twice as much stuff- Hmm ... as I used to do. And, um, you know, s- which, which is rewarding and f- fulfilling for us, you know, personally.

And what was the, what was the cue to start Emeraude Cap- Emer- not Emeraude Capital, but Emeraude?

To move into Emmerade?

Yeah, yeah

Um, it was really a matter of clients asking us, "What else can you do?"

Because we've always been a part of so many facets of their life with, um, their businesses, with their estate- estates, and their families that we've worked with. And, you know, it's just really built out of that, saying, "Hey, you help us with this, you help us with this. Can- what else can you guys do as far as are there additional, um, ways that we can get help?"

Um, and so when we started looking at it as like we definitely can help in other facets, um, as far as being able to provide those family- that family office structure, and being able to do a little bit

more in a, um, true, uh, structured family office kind of fashion. And so that was something that initially we looked at doing, was the multifamily office side.

And from that also looked, um, was kind of a natural evolution to go into Emmerade Business Partners. Um, Business Partners being the back office side of- Mm-hmm ... businesses similarly to the back office side of families- Mm-hmm ... and really kind of getting those organized, professionalizing the family structure, professionalizing the business structure.

And is the... Can you explain the offering? Um, just all the m- all the different arms of the offering for Emmerade?

Sure. Um, so- You did a good

job

Thank you. Um, so Emmerade ha- as I mentioned, has a multifamily office, so that is, um, one facet. Everything from planning, um, how to get younger family members involved, re- realigning, um, goals, strategies, as far as, um, ph- philanthropy,

as far as ultimate giving, um, as far as transfer of wealth, um, being able to do all of that.

Helping to understand what are their investments, how are they invested, what does that look like? We do not do, um, assets under management here. We do- we're not doing any of that. But to be able to help facilitate and identify there's opportunities for investment in different areas, um, that might make sense for them.

Being able- But really just kind of helping in that facet, um, under the family office side. The business partner side is really helping to organize and run the back office side of business. So helping with the bookkeeping, helping with, um- Moving in, we're moving into accounting and, and finance more and more- Mm-hmm

um, in that respect. Um, but just really helping just professionalize the, what companies do so they can focus on their true operations side of things.

Yeah, you know, if, if you step back, and we get this question asked a lot, and may be a question you're about to ask, well,

where, w- why'd you come up with, with the word Emeraude?

Where did that come from? And so I think if you, if, if I explain a little bit about where that came from, the story behind that, it'll, it kinda crystallizes, um, kinda what Emeraude stands for. So Emeraude is French for emerald, and, um, we didn't want to do emerald because there's a, a million emeralds out there, and, you know, it's a, a American term that every- you know, everybody uses.

And so we went with Emeraude, and the reason we went with Emeraude is because, um, it, it's not trite, it's, it's real serious. But if you go back and, and, and you kick back to The Wizard of Oz, which is, uh, is a movie that, that it's really, uh, important to Rebecca. It's a big movie of hers. But if you remember, the goal was to get to the Emerald City, you know, and that's what they were trying to do was, was get to the Emerald City, and that was where the Oz was.

So- Mm-hmm ... uh, the wizard would, would

get Dorothy back home to Kansas, and with the expectation being that the wizard could essentially point to that, or he could point to that, and just make it happen, you know, just easy and easy. Well, when you get to the Emerald City and you, you, you see a curtain, and you pull back the curtain, um, you see a wizard there who's, you know, on a bike.

He's like a hench. Yeah. He's going 100 miles an hour, 100 miles an hour. And that always stuck with us that that's really what entrepreneurs and family do that are, that are successful. Mm-hmm. You, you make it look easy, but it's not easy at all. It's not easy to build a company. It's not easy to run a company.

It's not easy to run a family. It's not easy to run a family. A successful

family.

And so the concept and the rationale and the reason that the w- that the company is, is called Emerald is because our goal is to help you make something look

easy that's really, really hard to do. And, um, and if you look that over the next 20 years, we've got $124 trillion of wealth transfer.

And if you look that historically family offices have e- have originated ... Historically, multifamily offices have originated out of wealth management, wealth managers, people who, um, get paid for assets under management. And so let's start with your assets and let's build out around that. And really over the la- You know, I think we're in a world now to where wealth and asset management is, is a very important but still just a factor of how a family wants to evolve, of how, how a successful, you know, financ- a, a, a structured family wants to evolve their legacy.

Used to, legacy

resonated with wealth or with assets, and now it means a lot more. It's more about strategy and about philanthropy and how do we make decisions and how do we transfer assets, or how do we deal with new wealth, or how do we deal with a special needs kid, or things that Rebecca or I deal with on a daily basis.

We have clients come in all the time and they go, "Here, let me tell you what my situation is. Do you have any experience with that?" We probably do. More often than not. Regardless of what your situation is, r- rather or not there's been drug abuse or, or abu- uh, other abuse or, um, handicaps or, you know, any, any sorts of those things, we've worked with families- Mm

and we can, we can say, "Well, here's how we dealt with that in this situation. Here's how we've dealt with this in this situation." But, but by and large, what we are seeing is we're seeing more people that are wanting to

establish a true legacy- Mm-hmm ... of how do we decide as a family what- impact we're gonna make to our community, to our families, to our lives.

And again, kind of for the same reason that we, you know, really just charge a hourly fee or a fee that's not based on success is, you know, we ha- we wanna be seen as someone that's independent, someone that's experienced, but somebody's that's on your team. And we're gonna give you our advice, and we're gonna give you our opinions and our counsel, but at the end of the day, the goal is to help you make a decision that's best for you.

I us- I tell people all the time, say when I was 30 years old, when I was 35, I could tell you what success looked like. I could tell you what success looked like for you. And now at 57, I absolutely don't have any idea. I don't know what churns you. I don't know what you're looking forward to doing tonight or this weekend.

Um, but what I do know Um, is that if you'll help me, if, if, if you'll help me tell you what thriving and success looks like to you, then we'll help you get there. And we've got the experience, and we've got the education, and we've got the relationships to help you thrive and help you get where you g- go.

And that's part of the multi- of the multifamily component of Emerade is that we've got other families involved, and that can collectively can create opportunities that you may not can create for yourselves. Um, and so from the, from the, from the family office side, that's that. From the business side, it's getting you above the white noise, is what I say.

You know, a lot of companies are out there in, um, in, in, in a promotion or a marketing. It's almost like cotton candy. It's like they look really good on paper, but there's no real substance behind them, or they don't really...

They're, you know, you have a lot of people who are really, really good at coming up with a product or coming up with a skill or a service or a technology, but most creative people are not also really good at, at the mundane, boring, behind the scenes, back of the house type stuff.

And so if you can help take an innovator or a creator and an entrepreneur and, and build out some professionalism and some maturity to their organization, then that's gonna put them at a level, uh, hopefully puts them at a level above the white noise of their peers and their competitors and gives them the best chance to succeed.

It's still hard to succeed. It's not, you're not made to succeed, but it gives, it increases your odds. And so from the business ownership side or from the business operation side, that's what we try to do, is, is help you, uh, fill in the gaps that you're not good at or, you know... And, and, and again, the

M&A and private equity and venture capital experience that we have gives a lot of comfort to our, our relationships on the business side.

Sure. It's like, "How do you do those? How do you... How, you know, what I need to be looking for? You know, 'cause I've heard all these fang and bad stories about people coming in and trying to invest in my company, and the next thing I know is I work for them and all that. How do I protect myself from that?"

Yeah. But it's first is how do we get them attracted to wanting to,

yeah,

have that issue to deal with.

When you said you were just talking about multifamily- Mm-hmm ... and creating opportunities that maybe your family, what do, what do you mean by that?

Creating opportunities for investment. You know, a lot of people wanna do alternate investments.

You know, some people may say, "Look, I don't have any... You know, I'd like to m- invest in real estate, real estate buildings or, you know, um, or invest in companies or things of that nature, and I don't... I run my company, so I don't see those sorts of things. How can, you know, how can you help me have access to things that I may not can have access to for myself?

Um, how

can you help me, um, again, with, with special needs or with, um, you know, saving for college, or now we're going into later retirement. What type of insurance, you know, do we know?" We don't, we don't do insurance either, but what we do have is relationships- Mm-hmm ... across the board with, with various people that want, that, that are the best at what they do, that can help obtain, you know, we, we facilitate.

We bring things together and, um, but, but it, it usually is financial or it's driven by some situation in

the family. Investment opportunities that- Yeah ... um, one family may have exposure in this area and are looking for other people to be able to invest in this project, and so by naturally having this multifamily office, it just kind of creates a pool of potential investors- Mm-hmm

working together, so.

Yeah. And then, um Color the lines in a little bit more, maybe pre-Emroad. Mm-hmm. You were working with a client, they had an exit, they sold their business for 50

million. Mm-hmm. They have this money that they didn't have. They have no idea what to do with the money. What, what did the, what did that used to look like with, with y'all?

Was it, "Hey, let us know if you need help with anything," versus now-

That's the s- ...

what does it look like?

That's the estate planning side of-

Okay ...

of Smith Hurst too. So, uh, when we say working with, you know, family offices and, and s- general estate planning clients, um, I've traditionally worked with, um, business owners who've had exits, you know, executives in the area, um, business owners who are, haven't had exits yet, um, just wealthy, generational wealth and families.

And so it's just really knowing how to structure assets and structure where, what they have when they have it in the best and most effi- tax efficient way, but also to achieve their goals for their family. So it's, you know, you never want the, um, um, to quote, "The ta- the tax tail to wag the dog." Is that the right way to say that?

Uh, "The tax tail to wag the dog." Um, and I'm

quoting Katie Eaves on that. Um, so I will say, I don't want to, I don't want to take her, uh, her quote there. Um, but um, you do want to focus on, on tax and, and do things in the most efficient manner, but you really need to make sure it works as an overall plan. And so I say all that, so yeah, if you have $50 million of liquidity, how are, what are you going to do?

How are you going to transfer that in a way that makes sense ultimately for your family? Um, having it in cash is probably not ideal because you can't really do a whole lot as far as leveraging exemptions from the estate tax, exemptions from the gift tax. And so we want to try to structure things in a way, put those to work, um, whether it's, you know, having done transfers or created transfers of the ownership interest in the company before they sold or after the fact and trying to find investments to be able to transfer to the next generations to be able to carry out their goals overall.

But you raise a really interesting question- Yeah ... because to answer your question from my perspective- Emroad does exactly what we always did. Yeah. We

just didn't have it separate, and we still don't have it separate. We s- There's still a lot of the stuff- There's a lot of overlap ... that we do in Emroad we've done through Smith Hurst.

And so as we saw where things are going in Northwest Arkansas, and as we continue to have more and more of our clients saying, "You know, we're really glad that you're our lawyers. We're glad what you do for us from a legal standpoint, but, you know, you do these other things for us. You're integral in the decisions that we've made on trust or, or our business planning or, or s- succession planning.

What else can you do for us?" And as we started saying, "Okay, N- Northwest Arkansas is gonna be a million people in 20 years." Um, we were told that it was gonna accelerate when it hit 500,000 people, and it absolutely did. Mm-hmm. And now we've got 615,000 people here, and they say when you get to 750,000 people, it's gonna do another

acceleration, and it's gonna bring another type of business or industry to town that doesn't come to t- towns of under 750.

And then you get to a million people, and everybody in the world can come here, you know, will come here, and will do business here. And so it's like if we're doing this stuff for our clients, and this is something that we have evolved ... 'Cause a lot of times, you know, when, when y- you hear enough of, "You do all this stuff for us.

You're lawyers, though. What else do you do?" It's like, well, let's ... We, we spend so much time on business strategy and family succession planning and philanthropy and those sorts of things, that let's go ahead and start branding this, and let's create these opportunities. And we wanted to create opportunities for Kristen and other people to be involved in a partnership level.

You know, as a lawyer, the only people who can own an interest in a law firm are lawyers. Um, in business planning and f- those sorts of things that Emroad does, um, it's not restricted by a professional license,

so Kristen can be a part of it, and other people as we- Sure ... grow. We can have non-lawyers that can be partners with us in, in those things that

You know, accounting that bring real value to the family offices and the businesses that we work with. But there's not a whole lot of, um, there, there's not a whole lot of stuff in Emroad that, that would go on that we haven't done historically. We still work with the same Um, uh, you know, wealth managers, you've got some tremendous, you know, wealth boutique and wealth managers in town, and investment advisors, and they're

Everybody's stepping up their game in Northwest Arkansas that wants to- Yeah ... because of what's going on. It's really exciting because a lot of our peers in, in the spaces that we work with but that we don't do, are doing the same sorts of, of strategy for getting prepared legitimately- Yeah ... beyond marketing and promotion, but

technically and, and the

And we're in a world now to where, you know, you can do that, where, where you don't have to be 5,000 people in an organization. You know, we all get access to information, it's what do you do with that information, and we've got a lot of people around here that are really good at taking information and knowing how to benefit people with that.

We love working with them.

Yeah. So a typical client for MROD, how many touch points are there throughout the year?

Um-

I mean, is there like a secret sauce of like, I mean, are you meeting monthly or, uh, what's the-

It, it obviously depends on the client- Yeah ... and what their needs are. And on the business side, of course, it's much more often.

Mm-hmm. Um, I would say, um, that's weekly, um, to monthly- Mm ... depending on their needs. Uh, family office, uh, can be monthly. Um, a lot of ours are monthly right now. Mm-hmm. Um, again, just kind of depends on what the overall needs are, but I would say, um, you know, those who are a lighter touch right now, it's probably, uh, quarterly.

I think, I

think it's like, um, businesses that get investment capital- Mm ... private equity, venture capital, you'll notice when you do that, you start having board meetings like every month- Mm-hmm ... for a year or a couple years, and then it goes to every quarter.

Yeah.

And then it may go to twice a year. You know, and it probably doesn't really...

You, you know. So the m- you know, as you create them, there's a lot more touch. Mm-hmm. And, and, and we've done that. I c- I can think- Yeah ... of families that we have had to where, you know, you do the estate planning for them and their kids are younger. They start going to college, and then as they get older and the torches are passed, you know, certain family members who used to run the show now maybe show up once a year.

Mm. Uh, and the lower generations who used to sit there and kind of take notes and kind of observe are now running the meetings. Mm-hmm. And that's a lot of fun. Yeah. You know, that, that's exciting, too. Absolutely. So it really kind of depends on the cycle of where the business is or, or where that family is.

And

for someone listening to this who's questioning like, hey, whether or not they should call you, whether or not they're in the right place to do so- Mm-hmm ... what would you say to them?

Make the call. We'd be happy to talk, and we- Yeah ... I mean, if you're even thinking that it might be something that you're in need of, you know, to work with, um, a family office or, you know, for business services support, um, call us.

We'd... You know, we'd be happy to chat, and, um, we won't know until we talk, so. But

we're the first to t- Yeah. But, but- But we're also not ... but if we're not the fit, we usually know who is.

Yeah.

And so if it, if it's, if it's not a skill set or if it's not a good rapport, then we usually- We don't- You know, we're not shy to say- We don't try to

yeah ... "Why don't you go try these folks?" So.

Yeah, we don't try to make square pegs fit in round holes. No. So we wanna definitely help people find the best fit for them.

What's a mistake y'all have made along the way? Could be in either business

There's a lot of mistakes. Yeah. Um, you know, I think, ooh, um, you know, I think the biggest mistake, and I

don't know that it's, it's a mistake, but, you know, you have to make a lot of assumptions in business, and you have to, you know...

Um, I think the, one of the best decisions that we made was moving from Fayetteville- Fayetteville. Mm-hmm ... up here. Um, bad mistakes for a small firm are to have multiple locations. It's just hard to maintain- Oh ... culture. It's hard to maintain culture when you're on separate floors. Um, and so I think that, that, uh, um, you know, as far as missed things, I mean- I think any time that you waste time is a mistake, and you don't always know when you're gonna waste time.

But I tell people, you know, I'm at, m- I'm 57. My ki- our kids are grown. We're empty nesters. We've done well. We're no longer having to chase the dollar, we're kind of chasing purpose now, and I don't mean that altruistically or anything. I just mean- Mm ... you

know, over the next... You know, as you age, you, you s- I, I won't say that you sit around and you stress about how little time you've got left.

You just become cognizant that at some point in time-

That time

is a commodity ... things are going to change. Yeah. And so I understand that I'm gonna lose money and I'm gonna waste money. No matter what I do, I'm gonna do that, and I'm okay with that to a certain extent. But what I'm not really okay with is wasting time.

Uh, and, and I've got, we've, yeah, I've gotten a lot more selective in how I wish to spend my time. And, um, and I think that, that any, i- so I could throw off a litany of times that I have thought that I was spending my time really well that was a waste of time. And when you do what we do, a waste of time is, is a lost opportunity.

And so, um, so, uh, probably from a confidentiality

standpoint, I can't really say- Yeah, that's- But I will say this, I don't think it was a mistake to leave and, and start our own firm at 42. Would it have been a mistake at 52 or 32? Yeah. I think it was the right time for me to do it. But, uh, I think we've had a, had a lot of luck, but, but if I had any mistakes, it was wasting time- Mm-hmm

because the older you get, the more you say, "Man, you don't really have a whole lot of time to waste if you wanna make the m-" And a- and again, it's not a financial deal, it's just a use of time.

There's only so many hours in the day. Yeah.

Mm-hmm.

That's right.

How have you seen the private equity, uh, like Arkansas private equity?

So obviously we've, we've seen private equity come from out of state- Mm-hmm ... but you talked about New Roads earlier.

Yeah.

You talked about that transaction in 2013 with Acumen and I- Mm-hmm ... I worked for John back in the day- Yeah ... and used to hear him say all the time, that was the biggest... Like, there, there wasn't a ton of money in the state that was

doing that.

So-

Yeah ...

have you seen that change? How has it impacted your business?

Um, what I see is I see m- more mature companies. I, I heard the other day that the age of a founder- has gotten back up into, like, the low 50s, which is odd, 'cause most people think it's like a 25-year-old. And you see a lot of people that, that go out.

And, and so I think that, again, y- we've, we've started having enough success, and the deal sizes have gotten to a level to where people are more understanding to invest. You know, back 20 years ago, 10 years ago, um, if you, if somebody was gonna invest in a company, you would inevitably see a couple things.

You'd see somebody scratch their head about, "Well, why are you in Arkansas?" And if we invest in you, are you gonna move to Atlanta? Are you gonna move to- Mm-hmm ...

Dallas? Mm. You know, so, so the issue was if they could get over the hump of, of you having a business in Arkansas, are you, will y- if we invest in you, are you, will you come to us?

And what has happened over the last 15... You know, since about 2015, with all the stuff that Walmart and, and all the evolution of things that have gone on here, when you look at CPG or retail tech or health tech or supply chain or logistics, and you look at the names, you look at Dan Sanker and you look at SupplyBook and you look at John and Terry and you look at, at these guys, um, and you look at what's going on in the ecosystem, in the space that controls here, and the jets that are parked at Thadden that are at meetings at Walmart and all these sorts of things, it's no longer a head-scratcher if you're in an industry that makes sense for you to be in Northwest

Arkansas.

It's no longer a head-scratcher about why are you here. If you don't know why you're here, and I'm in CPG or I'm in retail tech or I'm in health technology or media or something, then that's your problem and that's not ours. That's no longer an issue about the legitimacy of why are you here. And then the other thing is why would you move when most people are wanting to move here to get closer to what's going on here?

Um, and so I think that's why you see more interest in, um, venture capital and more interest in private equity. Uh, but I do think you're also seeing changes in private equity. You're no longer seeing family offices just really get thrilled to go invest in private equity funds. They're, they get enough deal flow.

They see enough deals. They'll invest as an sidecar beside funds or

they'll share in carries or fees or things of that nature. So I think you're gonna see more evolution of a change of private equity and venture capital and become more of, of a incubating, and I, uh, uh, you know, an ownership operating type structure.

Um, but I do think that Northwest Arkansas has become much more of a legitimate market thanks to The Hunts and the Waltons and the Tysons and the Simmons and the Georges and all the people that you would expect, but the talents come here. You know, the people who come here stay here. When, when somebody says, "Okay, we wanna move you to another part of the world or another part of the country," some of these folks are saying, "We'll just stay here and kinda create our own thing with our own network."

And so we've gotten... I think it's more that we've gotten more legitimized in our region, and that's attractive. That's less risky for private equity to invest.

Um, I think it's important for our airport to continue to grow- Mm-hmm ... significantly and become an international airport, which I have no doubt it's going to be.

But, you know, the more one, you know, no layover trips you can have, the better. You know, that's, you know... I don't know if they still do, but 10 years ago, private equity firms would say, "Look, we're, we, we will invest where we can fly to."

Yeah.

And if we've gotta make a connection, then that's an issue for us, you know, or things like that.

And I think people don't really appreciate the reality of those- Mm ... of those sorts of things. And so I think we're more legitimate, we're more mature, and I think we're gonna... You know, we've had more successes. We've got things we can point to. And, and we have drivers out there. We have drivers that, that, that have the ability to bring money here and have done a really good job of doing it

Um, so talking about, uh, the future, what do the next five years look

like for Smithhurst and M Road when you, when you see the next, the next phase?

Wow, we've had, uh, we've had a huge year this year, so, uh, just a lot of deal flow, a lot of, um, great things going on from Smithhurst's side and then, um, with M Road just continuing to grow, um, as well. So I would love to say, you know, we're continuing that, to see that growth trajectory. I think that, um, that aligns with what we're seeing for Northwest Arkansas overall, and I expect that that will be the case.

Um, continuing to grow, grow our team with the right talent is what I'm hope- you know, always hopeful for. And we've been very fortunate to ha- um, hire, have some great hires on both sides of the, um, of the wall as well. Mm-hmm. Um, so that's been great. Um, but I just, I would just like to see a, you know, continued path of growth and success in that respect.

But yeah, I mean if, i- if, if you ask me what keeps me up at night- ... um, it's relevance, and it's how do you stay relevant in a market that is changing? Mm. Market that's

gonna change with or without you. Um, are you wanting to be a part of it? Um, when you had the sophistication and you have the specialization of what goes on now, you know, you said you, you were at Acumen and you worked with John.

You know, there was nothing like that, you know, back then. Um, and, um, and, and, and you saw that 'cause you saw, not only did you see leading private equity firms, but you had the leading, you had the leaders of those firms that were doing the deal. I mean, you had Anton Levy, who was the president of General Atlantic, that was on the board at Acumen and, and Zach Kaplan, and you know, those guys.

And, um, so it was real attention getting. And now as you grow and you get more closer to that million people, 750,000 million people, you're going to have more talent

come to town. It's now becoming a- region to where it's relevant to big players, and the big players are gonna come. So if y- if they're gonna come and they're gonna compete, what's your advantage?

Your advantage is you're here. You know the people. You've been here 20 years. You've got the relationships, but the fact of the matter is, um, everybody has gotta step their game up. If, um- Still have to

deliver ...

if, if Doug McMillon had not made the d- the, had not had the vision that he had in 2014 and had gone down a different path, then, you know, the, the, the s- the competition between Amazon wouldn't, would not have been there.

And they made some great decisions. And, you know, you can't rest on your laurels. You can't rest on what today looks like. And so when I sit around and worry about how I'm gonna spend my time, it usually translating into, is that gonna affect my ability to be relevant? Because people are gonna come

to town.

They do that. You do that every day. In the world I live in, everybody's always saying, "I know more than you do 'cause I'm from New York. I'm from Atlanta, or I'm..." You know, it's one thing if you're 30 and you're doing it. It's another thing, it's like if, okay, you're 60 years old and you're still telling everybody where you went to school.

That's- That's really more your issue than it is mine. Uh- That's

great.

But, uh, but, but you know, it's, uh, it, it, you've gotta be relevant. And you've got to, y- you've gotta, you've gotta understand where your lot is gonna be, where you want it to be. You've got a lot of, of de- deter- you know, the decision, to a large degree, not entirely, but to a large degree is, is your decision where you wanna be.

But, but if you, if the plan is I'm copasetic and I'm pretty happy with my intellect or, you know, my capacity or my whatever, then that's fine. Just accept it, but just know that people are gonna

come here, like Procter & Gamble did, and like, you know, General Mills did, and all these. Just know that they're gonna come re- regardless of what your field is.

Yep.

They're gonna come. Mm-hmm. And you're, if, if you wanna compete with them or s- beat them or whatever, you know, figure it out, and that's kind of what it-

It's what

it takes, yeah ... what it mean, means to us. That's kinda where my head is. Uh- You know, I like to win and, um, I like to be on winning teams and, and all that.

And so, you know, we have significant talent, you know, in the, in, in the firm that we've got. We've got three graduates of NYU tax degrees. We've got one from Georgetown. We've got two from Northwestern. We've got, we've got one who is executive editor of the food, uh, food law journal policy. You might... What's that mean?

Well, think about that. Think about all the CPG and all the retail and all the snack foods we do, and she handles all these distributorship agreements and all these manufacturing joint venture agreements,

all these MSAs, and these job orders, and our clients love her. And she has, you know, among the best depth in the country when it comes to food and, and things that, that are really involved with, with what, what's a part of the ecosystem here.

So we're, we're strategic, um, and we know that, that we usually go up against the biggest firms in the, in the world. Mm. And, and we feel very comfortable. We... You know, I wouldn't say comfortable. You, you just feel very confident that you can-

We

feel very capable ... you, you can cer- Yeah. You're very capable.

Very

capable. That's the word I would use. Yeah. Cap- we're, we're a- equally capable to be able to handle those situations, so.

That's awesome. Yeah, last couple questions. I would like for both of you to kind of answer these. Sure. The, uh, um... Number one, why build a business in Northwest Arkansas?

Um, why not build a business in Northwest Arkansas?

Um, Northwest Arkansas is ama- you know, on such a growth trajectory, as I've said, um, but just an amazing place to be. We have, um, just our le- our

leadership, our, um, community has really embraced, um, the arts, the lifestyle, um, just outdoors, biking, you know, healthcare. Everything that we have here, um, I just am amazed with where we are versus when I, uh, moved up here in 2002.

Um, it's just a tremendous, uh, change of, um, the economy, the, um, ecosystem, just, but just the arts and the culture that we have here, in addition to just a great business climate for success. I think, um, we've always had that kind of history of entrepreneurship, but it's really just taken to a new level, I think, with just opportunities now.

I think, um, tell people I f- I, I don't think that where we are right now in Northwest Arkansas is a once-in-a-lifetime opportunity. I think it's a once in two or three lifetime

opportunities. I just really feel traction. Um, there are intangibles about the region. Intellect, financial, entrepreneurship drive, um, that- You don't see every generation, every lifetime in certain parts of the world, and I just think that the heartland, uh, is gonna, i- is going to be a real accelerator going forward.

Um, and I think that our place in it is different, uh, differentiated even, even from, from our peers. Um, and when you look at, at other places that are, that are like that, um, I just, I sense a lot of... I just, there's a lot of good decisions that have been made, and there are a lot of people who are able to make decisions.

And, you know, I th- I think, you, you know, why not is absolutely right. But I think that, um, I think that there's just a certain drive here and a certain capacity financially and intellectually that separates it, that if... And if you're into that- Mm-hmm ... then this is the place for you. And if you're not into that, if you're into chilling out and relaxing-

this is the place for you too. Also a good place for you. You know, you can do that here too. We have options here. You, you've got it all. The only thing we don't have is a beach, and that'll probably be here before we know it.

Uh, Tom and Stuart.

Yep.

Um, the, so last question, uh, how do you define success?

I'm not good at that. You go ahead.

Uh, success to me is living your best life and thriving, whatever it does. You know, if, uh, if you can make it through this world, uh, and feel good about it and be happy and you're thri- and, and you're living your best life, then that's

success to me

I, you know, I often equate success with happiness, and I don't know if that's a good way to equate the two. But, um, I think, you know, being able to take on something that makes you happy, which, um, I, you know, having a business and being a business owner, I think a lot of times I find that I really enjoy what I do on a day-to-day basis, and I think that does make me happy on the professional side.

And then having, you know, family that, um, is... and personal relationships that are fulfilling, I think all of that adds to what it, what it means to be successful. And I th- that's what, that's how I would define success, is just finding that personal happiness, finding that professional happiness in what really, uh, makes you tick

Awesome.

Uh, well, one of the things we do at the ever- end of every episode is we like to talk through kind of the big three themes that we learned from y'all today. We think people who are working in northwest

Arkansas in the business community, starting businesses, operating businesses will also learn. And I think the first one that I wrote down was focused.

Um, I think e- the way the firm was set up, the specialization of it, and then even just hearing you guys rattle through the talent that you have on the bench- ... and the spec- specialization of the talent, I think you're very focused on what you want to do and what you don't wanna do. You talked about not doing litigation, and just very focused.

Um, and I think anyone who owns, operates, is in the business world, like, can, can learn from being focused. Um, I think the second thing is, uh, just being strategic. I think even hearing you talk about at, at the last part where you're like, "If I would've made the jump when I was 31 or 51, like, I don't know that it would've worked out."

Um, I think there was some strategy to, to when you made the leap, and I would think, think through other founders who've said the same thing. Um, and it's, it's easy looking in hindsight to, to

say maybe that was the best time. But when you're actually in it, when you're making the sacrifice, leaving a really stable job, the best firm in, in the state is what you said, that's, that's

There's some str- strategy involved. Um, so hearing that and then even hearing you guys talk about moving to Benton County, um, when you did. You know, in hindsight it looks easy, but at the time- Could

not have been a better time.

At the time, there was some strategy involved there. So I think that, that was really, um, great to learn from.

And I think the last thing that was a thread through the whole conversation, I'd use the word passionate. I think both of you, you talking about what you do for your clients and, um, you, you got a little technical at some points, I think it's 'cause you're passionate about what you do, and that's a good thing.

And, and, uh, we hope to be that way, right? We want to be that way. If you're owning, operating, running a business, you wanna be passionate about what you do. And I think hearing you talk about, um, one, the ecosystem of founders and entrepreneurs

here, and then hearing you ... I could see it in your face when you were talking about some of these people, some of these transac- not, not transactions that you've worked on, but maybe, but these people who you've seen have success in northwest Arkansas, you could tell you knew more than just their story, right?

Like, um, and you appreciated what they've done for our area. And, uh, I think we share that same passion for the area and the ecosystem and the business community. And so I think those three words would really summarize what we learned from y'all today, so. Um, Jim, Rebecca, thank y'all so much for your time.

If people wanna reach out, learn more about Smith and Hurst or Emerald, where, where, where can they do that

the best way? Um, our websites are a great, uh, great place to go. It has all of our contact information. That's, uh, smithhurst.com and theemeral road.com.

Perfect. The, perfect. The.

Yeah.

Um- Well, thank you,

guys

well, thank you, guys. And, and- Yeah, thank you, guys ... you, you do a great job, and, you know, anybody that kinda supports founders and, you know,

highlights them, that, that's great. So thanks for what you're doing too.

Absolutely. Appreciate it. Appreciate it. It's awesome