market upheaval Archives

Joel Block is CEO of the Bullseye Capital Fund and founder of the National Association of Syndicators. He has taught thousands of real estate brokers, CPAs, attorneys, and investors about raising capital and best practices for structuring group investments. Joel is also a nationally recognized expert in Private Placements, Reg D Offerings, Operating Agreements, deal structure, valuations, tax issues and capital raising approaches with both accredited and non-accredited Investors. He has his finger on the pulse of many of today’s business trends — the episode is worth a full listen!

(You can also listen back to DealQuest Ep. 4, when Joel was a guest almost two years ago!)

Joel’s Entrepreneurial Beginnings

At age 9, Joel and a friend bought a broken down mini-bike and got it working. (With the help of the friend’s dad!) Then they resold it, doubling their money. Joel says he didn’t fully understand how it happened at the time, but he got “bit” by the entrepreneurial spirit with that exchange.

Since then, he went on to begin his career as a CPA with the prestigious firm of Price Waterhouse. During his time with the company’s Entrepreneurial Services Group, Joel immersed himself in the real estate syndication business, and went on to launch his own syndication, raising several million dollars in three short years. By 1990, he had built a property management firm with a portfolio exceeding $100 million. Joel continues to syndicate real estate and other assets, as well as counseling other promoters on successful syndication strategies. He is also involved in many other types of deals!

As a real world, 25+ year veteran of the venture capital, private equity, and hedge fund world, Joel also gets to address global audiences on matters including capital formation and Investment CrowdFunding. Twice each year, he hosts and headlines the standard-setting Real Estate Syndication and Hedge Fund Symposium program, educating and advising CPAs, attorneys, investment bankers and asset class specialists on organizing and running investment pools.

Actionable Business Trends

Joel notes that he’s always been a bit of a futurist, even when he was younger. That also means he’s a bit of an academic, although he notes he prefers to take action on all his thinking. He realized that when he asked a group of other futurists how they can know when they’re getting things right. While detailing his own answer, it all came down to researching, making predictions, and then betting on those predictions with real money. Actually placing the money and taking action was important to Joel — but based on the group responses, many futurists prefer to stick to the thinking part!

In his opinion, that action taking is part of what sets him apart from others.

Now, Joel’s organization puts that combination of thinking AND action together by creating business trends books. They dive into what is happening in the market, what questions you need to be thinking about, and what observations they’re making about the market.

As someone with skin in the game, Joel is a futurist who is deeply invested in accurately understanding the trends. When you read his business trends information (which includes 29 trends he’s seeing now), you can tell he takes this seriously!

Joel’s Favorite Trends

Although Joel said that ALL 29 trends feel like his favorites, he often finds himself talking about two in particular. We dove into those on the full interview, but I’ll include a few highlights here.

Subscription Trends

First of all, Joel noted the ongoing trend towards subscription revenue. (Listen in to hear how this was distinguished from fee revenue.)

In the “old days”, Microsoft was in the business of selling software. Now, they still make software, but they don’t sell it. Instead, they “rent” it to you via cloud-based accounts. That’s because, in 2011, they had the opportunity to get off the transactional rollercoaster they were on and create a more stable revenue flow. With more predictable revenue, they had the opportunity to increase their stock market positioning. This is a classic example of using a subscription revenue model.

This model did take a few years to take off. However, from about 2015 and afterwards, they had shifted almost completely into subscription-based revenues.

Joel notes that, years ago, he would pay around $250 for a hardcopy of Microsoft software. (The discs you used to actually take home from the store!) He would install them on his devices (with up to 5 licenses, his kids devices usually went under this purchase as well). Then, it could easily be 5-10 years before he upgraded to the next set.

Now, he makes the purchase online, and pays $99 per year for access to the same thing. Microsoft can handle bugs and make updates in live time….and instead of collecting $250 over the course of 10 years, they’ll now collect almost $1000 from Joel in that same timespan. That’s the power of a subscription model.

And that’s not all. In addition to increased revenue, Microsoft’s stock prices went up in excess of 500% after the change really took effect. (The rest of the market saw average growth closer to the 50% mark during that time.) That’s not a coincidence!

Joel recommends looking for just one product, one line, or one service in your existing business that you could convert to a subscription opportunity.

Work-From-Home Trends

Next, we discussed the current work-from-home phenomenon, and the changes it is portending. He believes that many organizations, including governmental groups, are in for the shock of their lives when things don’t return to normal.

Overnight, the working world changed in fundamental ways.

All signs indicate that we won’t be going back to the “old” normal. Joel predicts we’ll see many increases in flexibility with work location and time. From full-time working from home, to alternating office and home days, splitting employees into A/B teams (that have complimentary office/home days), or other creative solutions – changes like this will be here to stay!

A lot of people make friends, socialize, and find life partners at work. There are good reasons to physically go to the office! However, people are also caretakers for children and parents, and have many other life roles that make flexibility much more optimal. Employers are being forced to acknowledge that many roles CAN be done from home. Moving forward, it’s unlikely that spending 40+ hours per week inside a physical office location will be an assumed expectation or norm.

The Ripple Impact of Business Trends

This has ripple impacts! For example, fewer people driving to work means less traffic issues. It might also be positive for the environment overall. However, just as there are “winners”, there will be “losers”. Demand for gasoline (for all these cars we’re driving much less) may go down. Joel predicts that oil is going to be soft for upcoming years.

He also expects cities and governments to see a massive decline in revenue that would normally be generated from things like parkings fees and taxes, traffic violations, and more.

In addition, Joel notes businesses are going to be renting smaller spaces (decreasing rent costs and utilities costs). This means that the people who own facilities or manage water/utility companies are going to see losses as well. The shoe shiners will see a downturn. The restaurants that cater to business people who are eating on the run will take a hit.

At least in the short term, traditional business centers are going to see downturns, reductions, and losses. Joel anticipates that this is eventually going to lead to money moving out of urban areas, and into suburban and then rural areas. We really dove into ripple effects, and it was so interesting. Listen in today to hear all about that!

Corey Kupfer is an expert strategist, negotiator and dealmaker. He has more than 35 years of professional deal-making and negotiating experience. Corey is a successful entrepreneur, attorney, consultant, author and professional speaker who is passionate about deal-driven growth. He is also the creator and host of the DealQuest Podcast.

If you want to find out how deal-ready you are, take the Deal-Ready Assessment today!

Steven Mail was the founder of the largest single manager global macro hedge fund in Europe. His investments center around companies that deliver insights to hidden areas of the enterprise. He is an ambassador for business to Scotland and an advisor to the Endeavor organization. Throughout his career, Steven has experienced market upheaval and panic. He says those things have shaped him for the better as both a businessman and investor.

Steven is also the founder and managing partner of Mail Venture Partners. He got his start as a bond trader and hedge fund manager in London. After “retirement” at age 39, he moved to Florida, where he has continued to engage in investment and giving back. You can listen to our interview HERE.

Getting His Start

Steven runs Florida’s largest youth soccer club, but growing up, he was an aspiring boxer. Both of his parents were involved in athletics, and he had an early passion for them as well. Now, he’s thankful that didn’t work out!

At age 12, he started playing poker (he was quickly playing with kids 5+ years older than him!). At age 15 he started his first job, and at age 17 he started his first business. By 21, he was involved in business. Coming of age in the UK during the “big bang” era had a strong influence on Steven’s career path, as many doors in financial industries were open and there was a strong recruitment drive.

Unfortunately, the week that he started his bond trader trainer also happened to be the 1987 “Black Monday” crash. It was an unusual, emotional experience that shaped Steven’s entire career. He finds that he has always been able to survive and even thrive during the most difficult times in the market, which he connects to the humility and detachment he was able to learn from the volatile markets he experienced early in his career.

Steven also notes that the ability to reverse his positions has been a clear strength. He’s never held too tightly to a stance, and has been able to pivot and change as needed on a moment-by-moment basis. (This makes total sense! Detachment is part of the negotiating framework I provide in my book, Authentic Negotiating.)

Regardless of the difficult market, he started trading in 1987 as a bond trader and market maker. He thought it was a bit like boxing; you put out an offer (throw a punch) and they throw one back and it goes on like that. He loved the years he spent in that arena, and eventually shifted into proprietary trading. This coincided with the launch of the Euro and it’s trade being shifted from headquartering out of Paris and into London. Steven was named head trader, and had a fantastic first year as such.

Growth Through Upheaval

At the end of his first year as head trader, France wanted the Euro trade headquarters to return to Paris. After negotiations ensued it became clear operations were going to be moving. Steven felt uncomfortable about the language change, and eventually it was agreed that if he made the move, everyone would speak to him in English if he would be willing to come, which got him to agree. Ultimately, he was able to make many connections in Paris, and greatly enjoyed his time there.

After some time in Paris, Steven returned to London and continued to grow his career. He worked through another crisis in which the market dried up, and things got hard. The markets literally closed, and there was general panic.

Shortly after, Steven became aware of a Japanese pension fund that was desperate to sell half a billion of bonds. Despite the market havoc, Steven decided that everything has a price, and that there was an opportunity there. After evaluating the market, he made an offer they accepted — an offer that covered the losses from all the rest of the positions he’d held during the market upheaval.

His ability to continue engaging in the market and think strategically has enabled him to continue to experience success, regardless of whether the markets are up or down.

Investing in Mentorship & Advising

Steven shares he’s never been in the game to make the most money. Instead, he’s always wanted to have an interesting experience. He enjoys meeting people, traveling, and enjoying new things. As a result, it’s no surprise that his career has changed over the years.

He found hedge fund management to be much slower than bond trading, and when he moved into private company investments he found it to be yet another slow down. Now, he does fewer trades, and they take longer.

Whether you find yourself in trading or investing, Steven notes self-confidence is key. If you don’t believe in yourself, who else will? Beyond that, he also looks for humility and character. In the same way you want your friend group to be made up of great people, the people you invest in ought to be the same.

His investor role often comes with a great deal more advising than his time in trading did. Steven leverages his network for connections, advice, and insight — he enjoys mutually beneficial relationships that highlight giving back and growing. Mentorship has also been something he engages with, from his formal role with Endeavor to his work with the youth soccer league in Florida.

Making Investment Decisions

Steven enjoys finding ways to help companies by opening doors and making connections. One way to do this is to help companies piggyback off of each other in order to scale their growth to the next level.

He pictures investing as a pyramid, and finds early-stage companies to be the most fun to get involved with. He also notes it’s key to look at and choose individuals when investing in early-stage businesses. After all, the business itself is going to pivot as things progress. Rather than getting too attached to the hoped for final outcome, he finds it helpful to choose founders who have the traits needed to really push through the difficulties and change as needed. To that end, Steven looks for problem solvers who have resilience. Evolution, growth, change, and problems are all part of starting a business, and a founder who can’t endure them won’t be able to build a business that can last.

His Most Important Interview Question

Thinking back 30 years or so ago, Steven notes that the best interview question he ever asked applicants was:

What’s the worst thing that ever happened to you, and how did you handle it?

It may be a popular question now (or at least some form of it), but when he first started using it it was quite uncommon. He was specifically looking for people who had lost money and been able to make it back. Ultimately, he was hoping to find the quality of the “bounce back” in new applicants. No matter how good the markets looked at the time of the interview, Steven knew how quickly things could change. He wanted to hire candidates who would have resilience and grit when things got hard, because it was inevitable that they would.

For longevity and sustainability, you must be able to endure the hard periods and be willing to push through. I remembered a seminar I was at years ago when a speaker who had undergone a great financial failure was asked what his mistake had been. His answer? “I mistook a bull market for brilliance!”

Doing well when everything is going well isn’t that hard. Showing up, putting in the work, and refusing to quit when everything is falling apart – that’s what sets successful people apart again and again.

Growth Mindset

At the end of the day, embracing challenges, showing you can grow through hardship, and making smart decisions are key indicators that Steven looks for when he considers investing. He sums this all up as having a growth mindset, and thinks it is a powerful key to success.

To learn more about how he makes his investment decisions, what values have driven him, and how his journey has continued to unfold, listen in to the whole episode!