Intentional Growth

On today’s show, I’m talking with Joseph Fung about what we can learn from a serial entrepreneur. Entrepreneurs often struggle with the idea of following their passion but also realizing that their businesses are an asset and are something they eventually will want to liquidate and tap into at some point. How do you make the change and social impact you want in addition to building your business as an asset? Can you balance these two aspects of running a successful business?

Joseph knew from the age of 18 that he wanted to leave an entrepreneurial legacy. True to his goal, he has since started and sold five companies, with his biggest success going to NetSuite for $32M. He talks about his philosophies and how he balances sustainability and his version of conscious capitalism while also building businesses that are financially successful for him and for the future of the business beyond him. Joseph’s stoic and passionate perspective seeps into his approach to business and his advice to entrepreneurs.

He’s an excellent example of how not having your identity tied to your business opens flexible and lucrative doors to success. If you’ve ever thought about what it would take to be a successful serial entrepreneur, this episode’s for you!

What You Will Learn In Today's Podcast Interview 

What helped Joseph—from early childhood—know that he wanted to be a serial entrepreneur

Why defining what success means to you lets you make decisions more easily and keeps you on track for achieving goals

How the type of business, funding sources and future buyer all influence valuations

The breakdown of the five companies Joseph grew and sold, from how he raised the money to the end result of the sales

How unrealistic it is to expect outsized outcomes for every deal or every person on your team

How to plan for your family so you’re not overwhelmed while building your business

Why your first key hires should be a pair and how to track their outcomes

The role emotions play in M&A and how that impacts your future strategies

When you should start giving back to your team, business and community as an entrepreneur

Where your employees fit into the process of selling a business (plus when and how to communicate it to them)

How to identify when you can accept something versus when you’re willing to get fired for it, and what to do about it

Why Joseph moved from B2B to

On today’s show, I’ll be talking with Billy Amberg about accessing a unique type of capital: non-control growth capital. If you’re looking to fund your growth but don’t want to sell a controlling stake in your company, or you’re not a fit for a traditional bank, or you just want to tap into your largest financial asset, then this episode is for you. Billy is going to be talking about the entire sector of non-controlled growth capital, why it's needed, where it comes from, the terms and conditions that come with it, and the circumstances when it is most applicable. Tune in for a detailed rundown of how to make this type of funding work for you, without opening up your business to a whole bunch of risk.

 

What You Will Learn In Today's Podcast Interview

 

What’s going on in the current M&A marketplace

The definition of non-control capital: the various types, how to structure it and where it comes from

Billy’s definition of an institutional investor

How traditional private equity compares to non-control capital funding

The different roles of debt and equity when looking to raise capital

The different reasons entrepreneurs are looking for growth capital (e.g., acquisitions or distributions)

How to view your business through an investment banker’s eyes

What factors make owners resistant to different types of investors and buyers

Why Billy says the lines between venture capital and private equity are blurring

Why middle market private equity firms already have another buyer lined up for your business, before you even sign on the dotted line

What it's like having an investor sit at the table and what you should expect

Are You Growing The Value of Your Business

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

Are your company's current initiatives intentionally designed to increase the value of the business?

Do you know what you want from your business long term and why?

Do you know what your company is worth?

Do you know the differences between Management, Family Transitions, PE Firms, ESOPs and Strategic Buyers?

Does the business have a written strategic plan on how to achieve the desired normalized EBITDA and valuation?

 

About the Guest:

Billy Amberg is a managing director of Corporate Finance Associates (CFA), an international investment banking firm specializing in the middle market, as well as owner of Bloomwood Capital, which provides highly differentiated land conservation investment services. He has embraced the entrepreneurial spirit throughout his career, making an impact at elite wall-street firms as a principal in venture capital and private equity, and starting and running several successful businesses. Billy has also successfully performed in the three key roles for any transaction: owner, investor and banker.

 

Quotes:

04:46  - “If you really want to get good at this, you really need to start building relationships because that’s harder to teach, the older you get.” – Billy Amberg

09:26  - “The real standout, which I think is going to continue, is going to be technology because every business is a technology business now. Or, at least, that’s what the capital providers like to see.” – Billy Amberg

09:48  - “In the non-tech space, what I have told a lot of our client

The IT infrastructure of a business isn't usually what gets entrepreneurs jazzed up, however it can have an outsized impact on the risk of a company as well as a company's ability to scale. This episode is a crash course in how to manage, grow and update your IT infrastructure so it's a valuation enhancer, instead of a detractor. If you're not willing to invest in your IT infrastructure, you're asking your potential buyer to do so. How do you think that's going to affect your deal?

It is incredibly important to understand the role IT infrastructure plays in mergers and acquisitions — whether you're on the sell side or the buy side. Our guest today not only sold the IT company he started after 27 years, he also handled the six-company integration afterwards. Jake knows a thing or two about IT infrastructure and integration. Listen in as he takes us through the reasons why you should be doing technology-fueled mergers and acquisitions.

 

What You Will Learn In Today's Podcast Interview

 

The value of technology-fueled mergers and acquisitions

How IT is viewed by the buyer and seller during due diligence

Why cutting corners on your IT infrastructure could detract from the value of your business and increase risk

Ways to think about your IT if you're looking to sell in the near future

The impact acquiring a company has on your IT's infrastructure and how to plan for the extra capacity

How a company's IT fits into post-transaction integration

Why saying ‘no’ to upgrade requests from your IT person can hurt the value of your company

The value of technology-fueled mergers and acquisitions

What a security fortress is and why you need one

How to determine if your IT vendors are truly partners contributing to your long-term goals or simply selling you products and services to make bank

The benefit of having an infrastructure and application technology road map

How much IT integration costs, including the impact it has on your team

When to replace your IT person and how to evaluate their impact

Why your current IT infrastructure is holding you back and what you can do to fix that

How to avoid security threats in the modern technology market and mitigate IT costs

It’s not just data you’re protecting, it’s your entire livelihood

Are You Growing The Value of Your Business

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

Are your company's current initiatives intentionally designed to increase the value of the business?

Do you know what you want from your business long term and why?

Do you know what your company is worth?

Do you know the differences between Management, Family Transitions, PE Firms, ESOPs and Strategic Buyers?

Does the business have a written strategic plan on how to achieve the desired normalized EBITDA and valuation?

 

About the Guest:

Jake Kent is a Navy veteran, entrepreneur, and founder and CEO of two fast-growing information technology companies, JCMR Technologies and Chief Acquisition Lifeguard. In 2000, he sold JCMR after 27 years and helped with the six-company integration that followed. Jake has also previously started a bank, which gave him more insight on the IT securities market. Jake made it his mission to help CEOs view technology as a core feature of successful acquisition strategies by teaching them how to build a technology-fueled M&A plan. He is also committed to the community and has participated in many charitable events. He is a founder of the Matthews-Mint Hill Optimist Club and a Board Membe

The financial and cultural risk of hiring a C-suite executive is huge. Stats show that it could cost anywhere from 1-3 times their salary if it doesn’t work out. Today’s episode is all about what you can do to ensure the highest probability of long-term success when onboarding new executives. Steve Moss is the founder and president of Executive Springboard, which helps companies integrate C-suite executives into new roles. 72% of CEOs claim onboarding is critical, yet only 47% of their onboarding programs last more than a week. Steve shares how pairing C-suite executives with external mentors who have sat in their functional chairs increase the retention rate of new executives to 95%. Newly hired executives can lean on a mentor to navigate the minefield of culture, politics, relationships and unmet expectations that can derail even the most talented executive. Listen in to hear how you can make sure the next rock star you hire works out over the long term.

 

What You Will Learn In Today's Podcast Interview

The five top reasons executives leave and what to do about them

How trust plays a factor in hiring and onboarding

Why highly talented — and highly paid — executives need and deserve time to integrate into a company

The true cost of turnover if you hire the wrong executive

Why a C-suite candidate should come to an interview with a 90-day plan, even if it’s completely wrong

When to look internally versus externally for your next hire

Why an outside mentor can increase executive retention to 95%

What questions you should ask during an interview to get a better feel for a candidate’s fit, and what questions you can’t resolve until they’re hired

The difference between a mentor and a coach

The best ways to match executives with a mentor, and what qualities, experiences and attributes that mentor should have

Why managing change is like managing grief, and how recognizing that helps integrate a new C-suite executive

How important it is to have trust and confidentiality with your mentor

Culture is more than a feeling employees get; it’s about all the small goings-on and what the business is driving for

Why the most successful onboarding lasts eight months (and the stats to back this up)

How to measure the impact of mentorship, especially if your mentor is outside the company

Are You Growing The Value of Your Business

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

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Bryan Clayton is a serial entrepreneur with multiple exits under his belt and a unique take on being a business owner —  viewing your business like a video game — and how it can help you accomplish your loftiest goals. His first company, PeachTree, grew to be one of the largest landscaping companies in Tennessee at over $10M in annual revenues, before selling in 2013. Bryan only took a short sabbatical (more on that in the interview) before co-founding GreenPal, an online marketplace that connects homeowners with local lawn care professionals. GreenPal is already doing over $20M, over 100,000 active customers, and completes thousands of transactions every day.

 

What You Will Learn In Today's Podcast Interview

How the landscaping industry is a great place to learn how to be an entrepreneur

What Bryan learned from selling his first company at 32

The impact software has on manual labor-facing businesses

Why Bryan says being an entrepreneur keeps his life interesting and helped him grow as a person

How running a business and writing are alike

The biggest difference between being a business owner and an entrepreneur

When you should go into debt versus push for a debt-free business

Why you need to bake your philosophies into your business-running DNA

How venture capital is like rocket fuel and what impact it has on unprepared business owners

The real story of Uber’s success and the fallacy of “overnight” successes

When receiving funding, you have to aware of the bet you’re taking

What makes pragmatism the most valuable trait for an entrepreneur in Bryan’s eyes

The impact finding your ideal team size has on business planning

Why you should cut your teeth on smaller businesses to get a win under your belt before you start the big project

What land-and-expand can do for your business

Why you should make it easy for your customers to talk to you

Don’t let the bad actors get to you; feedback generally is in good faith

Why necessity is the mother of all invention

 

Are You Growing The Value of Your Business

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

Are your company's current initiatives intentionally designed to increase the value of the business?

Do you know what you want from your business long term and why?

Do you know what your company is worth?

Do you know the differences between Management, Family Transitions, PE Firms, ESOPs and Strategic Buyers?

Does the business have a written strategic plan on how to achieve the desired normalized EBITDA and valuation?

 

About the Guest:

Bryan Clayton is a serial entrepreneur with multiple exits under his belt and a unique take on the home services market. He is co-founder of GreenPal, a web and mobile app that instantly connects homeowners with home service professionals, where he actively engages with both his team and customers. Outside of work, Bryan likes to hang out with his family and play video games.

 

Quotes:

04:45 - “All of the fundamentals you learn in the lawn-mowing business apply to every business.” – Bryan Clayton

08:39 - “My business is the thing that lends purpose to my life. It is the thing that causes my life to be interesting. It is the thing that causes my life to almost matter. I didn’t think about it at the time but looking back at it, that’s the case. That’s just how I’m

If you’re acquiring a business, immediately overhauling the way the company operates is not likely going to be the most effective strategy. Unless the company was a fire sale, you’ll lose customers and staff by changing too much too soon. Getting people who are already in the company to buy-in to what you’re planning is crucial. When you buy a business, you’re acquiring all of its people too—and you can’t just expedite trust.

 

On today’s show, we have Kylon Gienger, president of Acquira (an investment fund for people looking to buy small businesses and an accelerator for those looking to do the same), who is going to prove the value of securing key relationships in new acquisitions, particularly with the people who will be executing the strategic plan to increase the value of the business. On the way, we explore the crucial role of emotional intelligence for any business buyer, the different types of search fund investment structures and what an ideal acquisition entrepreneur profile looks like. This is an episode you don’t want to miss if you’re looking at taking over a new operation.

 

What You Will Learn In Today's Podcast Interview

 

Why the acquisition entrepreneur is on the rise and how they can help fill a void in the impending wave of Baby Boomer transitions

The differences between on-market and off-market deals

How private equity is expanding the multiples in the home services industry

Why some sellers would be willing to take less of a purchase price to sell their “baby”

What the “gauntlet” is and how it’s used to filter the investors and business buyers Acquira brings into their ecosystem

Why you should never underestimate the human component of a deal—livelihoods depend on it

The reason you should keep on the previous owners in any lower market companies you acquire, if possible

How to hire good people—those who match your values as well as have the skills and training you need in the role

What factors Acquira considers when evaluating new businesses to invest in and their strategies to mitigate risks discovered

How Acquira is using EOS to onboard the companies they buy

When you should compromise with established staff rather than steamroll their ideas post-acquisition

The value of ongoing learning as a business owner (even if it’s just-in-time!)

Why understanding the human element of transactions can help you rise to the top as the buyer of choice

What the "Silver Tsunami" investment landscape looks like as $10 trillion in Baby Boomer business assets makes its way to market

How to make the transfer of ownership enjoyable rather than traumatic

Building trust in the culture of your company is vital to making the value creation changes you need

Are You Growing The Value of Your Business

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

Are your company's current initiatives intentionally designed to increase the value of the business?

Do you know what you want from your business long term and why?

Do you know what your company is worth?

Do you know the differences between Management, Family Transitions, PE Firms, ESOPs and Strategic Buyers?

Does the business have a written strategic plan on how to achieve the desired normalized EBITDA and valuation?

 

About the Guest:

Kylon Gienger is president of Acquira, and investment fund for people looking to buy small business and an accelerator for people looking to do the same. He is a serial entrepreneur hims

With the current state of the world, it’s only natural to wonder how stable the economy is, what is going on in the markets and if there are any major concerns on the horizon. Alan Beaulieu is on the show today to give us a market update. He is a principal at ITR Economics, which has had an unmatched 94.7% forecast accuracy at four quarters out since 1985. ITR has also predicted an economic downturn in 2030 as big as the Great Depression.

Alan has a reputation as an accurate, straightforward economist, delivering award-winning workshops and economic analysis seminars world-wide for the last 30 years. Alan has a reputation as an accurate, straightforward economist who has delivered award-winning workshops and economic analysis seminars world-wide for the last 30 years, and has co-authored three books with his brother Brian Beaulieu: Make Your Move, Prosperity in the Age of Decline and But I Want It!

 

 

 

What You Will Learn In Today's Podcast Interview

The impact the 2020 pandemic has had on the current and future states of the economy

The leading indicators ITR Economics uses to make their economic forecasts and how the four phases of a business fit in

How a lack of “sound financial thinking” is helping to spur the next depression

The importance of measuring your rate of change and how it will help you predict the future

How Alan and his team forecast with a 95% accuracy during the 2020 pandemic

The impact of 80 million Americans drawing social security (within the next decade), be on prescription drugs and using Medicare—double the 40 million who use such programs today

What modern monetary theory (MMT) is and how it could impact the future of our economy

Why one could argue we’re driving the bus straight toward the cliff when it comes to our economy

When to pass on growth rather than overextend

The fallacy of equality

Why ITR Economics is forecasting a serious depression by 2030

How focusing on relevant producer price index (PPI) can help you navigate your business through a recession

What to do to avoid floundering during a depression

USA’s new place in the global market and what’s next

What ways you can start de-risking your business today to better prepare for the future

Access to capital is crucial in order to take a dream and turn it into a business, create wealth and build a future full of opportunities. Today’s show focuses on the impact access to capital (or lack thereof) has on a Black business owner’s ability to create wealth through equity in a business. Rachel Wilson and Elliott Holland from Collab Capital share why and how they raised $50 million to invest in Black entrepreneurs—with backers such as Apple, Goldman Sachs, Google, The Andrew W. Mellon Foundation, Mailchimp and PayPal—as their debut move, making it one of the largest funds closed from an entirely Black-led firm solely committed to Black founders.

Rachel and Elliott debunk the scarce Black tech founder myth, plus share the investment strategy that increases Collab Capital’s investors’ IRR while hitting the company’s goal to establish a path to economic parity for Black communities by giving Black entrepreneurs access to capital and establishing generational wealth in a community that has historically been denied it. Learn the biggest challenges faced entering the market as an investment firm, as well as the individual barriers Rachel and Elliott had to overcome — and how that compares to what their parents faced not so long ago. Be ready to be inspired by industry disrupters working to bring about real change at a crucial juncture.

What You Will Learn In Today's Podcast Interview

The generational impact of compounding equity and access to capital has

The great benefits capitalism can have when aligned with the right mission

How home ownership is similar to owning a business when it comes to growing wealth

What equality really looks like in the business world

Stories to better understand the underlying causes of inequity in the market (and society)

The unintentionally negative impact a ‘core group’ of people who control access to capital can have

How solving the equity issue is going to require purposeful use and allocation of capital

Why Black investors are more likely to have to go to friends and family to fund raise and what Collab Capital is doing to rectify this

What impact recent social unrest has had on the market and Collab Capital

The fallacy of uncorrelated, outsized returns

What a shared profit and collaborative endorsement agreement is and how it can help grow a business

What it was like for Elliott’s dad as a Black financial consultant and what has (and has not) changed since the ‘60s

How focusing on lifestyle businesses allows Collab Capital to avoid the typical churn-and-burn of the industry

Why Collab Capital’s return on investment is good for both the companies they invest in and their investors

When celebrities and influencers can improve your business

Where private equity overlaps with a portion of profit model

How Collab Capital finds companies to invest in

 

Are You Growing The Value of Your Business

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

Are your company's current initiatives intentionally designed to increase the value of the business?

Do you know what you want from your business long term and why?

Do you know what your company is worth?

Do you know the differences between Management, Family Transitions, PE Firms, ESOPs and Strategic Buyers?

Does the business have a written strategic plan on how to achieve the desired normalized EBITDA and valuation?

 

About the Guest:

Rachel Wilson

Software and tech companies get much higher valuations than traditional service-based companies because these “digital” companies are valued on a multiple of revenue instead of a multiple of EBITDA. This huge difference in how the business is valued provides a unique opportunity to reap high financial rewards by transforming old analog businesses into technology companies.

Today’s guest, Corey Tollefson of ArcSpring, shares how his company combines capital, technology, operational expertise, and design to unlock exponential growth in traditional businesses. He and his team of rock stars (a bunch of heavy hitters from Oracle and Infor) are creating real value—and multiple arbitrage—by investing in companies they think should be software companies.

 

What You Will Learn In Today's Podcast Interview

What ‘Analog to Digital’ (A2D) means and how it impacts the value of a business

Why transforming an analogue business into a technology business changes the valuation methodology

How ArcSpring scales their portfolio companies by focusing on ‘micro-verticals’

The difference between a spreadsheet jockey private equity firm and one that has an operations background

How ArcSpring defines digital transformation

Why ArcSpring bought the largest flag football league in the area and how they scaled it by integrated technology 

Why having—or upgrading—an ERP system is not the type of technology that can change your valuation multiple

How to mine your customer base for new products and services 

Why a five-year timeline to transform a business from analog to digital is more than enough time to capture the value creation and multiple arbitrage 

How his company got to the tagline “Enterprise software sucks!”

Why the experience and involvement of the general partners at a private equity firm matters

How to use your customers and their needs as the backbone of your digital transformation

Things to think about when you are trying to determine how much equity you should be rolling

back into your business

What makes companies consider becoming a SaaS business

 

Are You Growing The Value of Your Business

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

Are your company's current initiatives intentionally designed to increase the value of the business?

Do you know what you want from your business long term and why?

Do you know what your company is worth?

Do you know the differences between Management, Family Transitions, PE Firms, ESOPs and Strategic Buyers?

Does the business have a written strategic plan on how to achieve the desired normalized EBITDA and valuation?

 

About the Guest:

Corey Tollefson is co-founder and general partner at Arcspring, a PE firm that invests in companies that should be software companies, and has over 20 years of experience in the software and technology industry. He’s on the Board of Advisors for #YesWecode, Sezzle and PLNIFY. Previously, Corey was senior vice president and general manager at Infor and group vice president at Oracle. He also has a BSc in Marketing and Management Information Systems from the G.R. Herberger College of Business at Saint Cloud State University.

 

Quotes:

06:57 - “To really own an industry and to become dominant in an industry, you have to have micro-vertical solutions.” – Corey Tollefson 

07:21 - “The more you can speak to ru

On today’s show, we’re focusing on how a founding entrepreneur grew and sold his tutoring business to private equity. John Rood previously co-founded Next Step Test Preparation, which grew from a 2-person tutoring company to one of the largest MCAT test prep companies in the US. After building it up from scratch, he sold it to private equity in 2018. He runs us through why he chose private equity over other sales options (including an ESOP) and how that influences his buying patterns today.

 After selling, John started a search fund: an investment vehicle through which an entrepreneur raises funds from investors in order to acquire a company in which they wish to take an active, day-to-day leadership role. John isn’t shy about diving into how search funds operate, what makes an attractive acquisition target, how capital structures influence a purchase, and the incredible value of long-term planning if you want to achieve your goals and ultimate lifestyle.

In this episode, you’ll learn all about search funds: what they are, how they’re structured, and how they might be beneficial and a viable option if you’re partnered with the right person who is going to be the owner/operator. If you want to learn more about search funds, go check out the Intentional Growth course at Arkona.io.

 

What You Will Learn In Today's Podcast Interview

How John turned his small tutoring business into a sellable business

What a search fund is and how to make it work for you

The big differences between private equity and a search funds

Why you should put meaning and purpose behind your business

How EOS© helped turned John’s business around

John’s reasoning when selecting his exit, including what eliminated an ESOP for him

The impact creating a board of advisors early on (before it was necessary)

Why you should sit down and plan out what you want your life—all elements—to look like in 30 years

What you should think about when choosing your staff to better address fit

The value of building a moat around your clients and its impact on your valuation

How John handled an out-of-the-blue offer

Why it’s crucial to understand how valuations work if you want to have a successful sale

What your network can tell you about market trends, especially in M&A

The importance of connecting with your employees and equity partners to get the full picture of what they value in your business

How to balance drawing a salary from your business versus taking distributions

Why you should look at hiring like recruiting for a sports team—you’re constantly filling your bench

What made John select an investment banker instead of a business broker

How to shed societal values that don’t serve you, and the incredible benefit of therapy on figuring things out

John’s key insights from selling his business that every business owner needs to hear

 

Are You Growing The Value of Your Business

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

Are your company's current initiatives intentionally designed to increase the value of the business?

Do you know what you want from your business long term and why?

Do you know what your company is worth?

Do you know the differences between Management, Family Transitions, PE Firms, ESOPs and Strategic Buyers?

Does the business have a written strategic plan on how to achieve the desired normalized EBITDA and valuation?