Reinventing The Art Of The Handshake Deal

In 1924 a Russian immigrant named Morris Zalefsky Americanized his surname to Zales and opened a small jewelry store in Wichita Falls, Texas. He bought diamonds directly from the international diamond traders, cutting out the middlemen, and passing the savings onto his customers.

Morris was known to buy millions of dollars worth of diamonds in sealed bags, sight unseen, and discharge the transaction with a handshake and a Yiddish “mazel und bracha,” meaning “luck and blessing.”

In 1915, when Levi Strauss asked Cole Mills of Greensboro, North Carolina to become their exclusive denim provider, that deal was made over a handshake.

And today, when handshakes are arguably the least Covid-friendly way of doing business, two companies are doubling down on doing business the old-fashioned way.

I sat down with Martin Hess, president of the American Club Association, and Jason Miller, the CEO of the Strategic Advisor Board to discuss their recent partnership.

First, some background. The American Club Association (ACA) was originally established as an association of private golf, tennis, city, and country clubs serving prominent civic leaders and business executives. For over 130 years members of private clubs across the nation socialized, recreated, and contributed to worthwhile causes serving their communities. At its peak, the ACA had over 100,000 members and counted Presidents Dwight D. Eisenhower and Harry S. Truman, and General Omar Bradley among its members.

For over 130 years this “association of associations” flourished with leadership originating from its national headquarters at the Kansas City Club building in Kansas City. The shuttering of the Kansas City Club in May 2015 triggered ACA leadership to chart a new course more in step with today’s digitally connected world. Today, the ACA Business Club, ACA is an invitation-only business membership focused on relationship-building, continuing education, and, as you probably have guessed, the handshake deal.

The Strategic Advisor Board (SAB), is far newer, founded in 2016, as a virtual business consultancy that offers counsel and strategic guidance from its organization’s ten advisors across the country.

Most business owners have only one coach, at most. Why ten?

“Everyone has two or three ‘superpowers’”, Miller adds. “Nobody can do everything exceptionally well, but by combining the superpowers each of us possesses, together we can move mountains.”

In explaining SAB’s business model, Miller equates it to a blend of management consulting and an incubator.

“In recalling my early years as a business owner, I remember how challenging it was to find useful advice and get the mentorship which I so desperately needed,” he states. “Based on my own experiences as a young entrepreneur, SAB was forged out of the desire to be a different kind of resource for business owners and CEOs.”

SAB’s sweet spot is working with established businesses with existing traction and revenue. SAB uses the combined experience of all ten advisors to create high-leverage strategies that not only solve their clients’ problems but catapult their businesses to the next level. For instance, Artie Leonard, the CEO of Reliable Solar Solutions took a huge supply chain hit.

The big solar companies were buying up all the equipment, leaving him multiple jobs he couldn’t fulfill.

“We had to come up with a strategy to get around that,” said Miller. “And the strategy was very simple. We started to go to developers and home builders and pre-sell solar equipment to them. So, he would get 50% of the job paid upfront. Now, he could turn around, buy the equipment from another company to fulfill it. And then he would have enough money on the back end to run his company.

SAB not only solved his problem but changed the focus of his business from doing one-off jobs to doing larger, more lucrative jobs.

“It's all about creating new systems,” says Jason. “They say, ‘Find an itch and scratch it. Find a problem and then you create a solution for that problem. That’s what SAB does.”

In their new partnership, SAB will become the executive-level board of the ACA, providing mentorship, professional development, business education, and collegiality. “Leaders can be lonely people,” said Miller. “Being a business owner doesn’t have to be an island.”

To which Hess added, “You can’t be successful trying to do it alone. You have to train with people who will push you and make you better.”

Relationships are Foundational

Though relationships form the foundation of the SAB and ACA partnership, the magic is in what the relationships can do.

Relationships Foster Business Opportunities

“It's the golf course methodology,” explained Miller. “Business gets done when people surround themselves with food, they surround themselves in a comfortable environment, and then people start to talk and people start to naturally solve problems and lean on each other.”

Why is it that deals are made on the golf course? Because it gives time and space for relationships to develop. All business, no matter how technical, web-based, artificially intelligent, or meta it is, is at the intersection of two people agreeing to partner together. And partnerships are built on relationships. Bringing entrepreneurs together in an environment where you break bread together builds those relationships that lead to future business.

Relationships Cultivate Mentorship and Growth

The partnership will not only provide opportunities for business leaders to collaborate, though that would have been enough. But ACA Business Club and SAB are looking to be leaders in business education and professional and personal growth.

“It’s all about mentorship,” said Hess, “learning from each other. I would much rather learn from your mistakes than make my own and you can mentor me on how I can not make the same mistakes and vice versa.”

“Mentoring,” Hess continued, “is about who you become in the process. Jim Rhone preaches all the time that there is a direct correlation between your personal professional development and your success in the business world. You should be working harder on yourself than on your job. Learning from others is so important.”

Relationships Move Mountains

Miller explained that he doesn’t do business unless there are three to four wins for everyone. “I have a lot of opportunities that move in front of me every day. And I have to pick and choose which one of those opportunities that I can partner with where I think it's going to move the needle to be able to serve people in the highest way and to really be able to move a footprint worldwide. I instantly knew that I would be able to do that with Martin [Hess].”

By building relationships around the country, on Zoom, around the table, and even on the golf course, ACA and SAB are looking to change the face of business everywhere — to a time when business was done with one’s word and one’s handshake.