How to Build Enterprise Value Before You Exit Your Business with Ken Reiter

Welcome to the B2B Growth Blueprint podcast, where we talk with entrepreneurs, founders, and leaders at B2B services, tech, and SaaS companies to learn the systems and processes they've used to create success for their business. And we'll also learn from marketing and sales experts to provide insights to help you grow your business. I'm your host, Mark Osborne, and the podcast is brought to you by Modern Revenue Strategies. And their 10x ROI B2B growth guarantee. Schedule a free diagnostic call to learn the fastest path to double your B2B revenues in just 90 days. Hello and welcome to another episode of the B2B Growth Blueprint podcast. I'm your host, Mark Osborne. Today, I'm very excited to welcome my guest, Ken Ryder. Now, Ken is the founder and CEO of The Strategy Playbook, where he helps business owners build value and make their business as valuable as possible and as profitable as possible should they ever take it to the market. Ken is a serial entrepreneur who started, acquired, grown, and successfully sold multiple companies over his career, including the exit of his own tech company, giving him a rare operator's view of what actually makes a business sellable and valuable. He's a Certified Exit Planning Advisor and brings that discipline to every engagement. What also sets Ken apart is that he has built a tool that helps businesses really grow and scale. It's called Growth Vector. It's an AI platform that analyzes a company across 8 different pillars, scores its enterprise value, and generates a current and best-in-class valuation alongside 64 elements against a strategic playbook. Really turning gut feel about what a business is worth into a data-driven roadmap that advisors can act on. So, today, we're going to talk about how to build that enterprise value and some of the unique perspectives that Ken has. So, Ken, welcome to the show.

Mark, thank you. I appreciate you having me on the podcast.

Absolutely. I've been looking forward to our conversation. But before we jump into some of the topics that we've got planned, why don't you give our audience a little bit of a background? Tell us a little bit the story of the twists and turns in your career that brought you to where you Sure, sure.

Happy to do that. So, I started out in technology. I was a network engineer and had the goal of eventually getting into leadership within the IT arena. I successfully did that. My first step was a director of technology for a transportation and management company. And so, I ended up— they relocated from the Charlotte area down to Jacksonville. During that relocation, I did not want to go because I had family in the area and didn't want to have to pull myself and my family away from extended family, i.e., the grandparents of my kids.

Sure.

And so, it was— it turned out to be a great opportunity to start a new business, which was called Infotech Consulting. And initially, we were contracted with the company that I had left as the IT director. But it gave me an opportunity to also begin to do some things outside of that. And so we ultimately built a transportation and warehouse management package called WebFreight Pro. We started building that in 1999, went to market in 2000, and then eventually in 2010, I sold that company and exited 2 years later after staying on as part of the transition. That gave me an opportunity to then go out and acquire another company. That company was an auto repair shop. It was an idea that my wife had because I liked working on cars, and she said, oh, you should buy a shop. And I did. And it turned out I actually didn't enjoy being an owner of an auto repair shop. So I did hold it for a couple of years, and then I sold it for a profit a few years later. Then I got recruited to go back into the corporate world, and I was a CTO for a Cricket Wireless dealership, a new dealership that started up in the Southeast. We ultimately built 37 stores across 7 different states in the Southeast. During that time, I was asked to step up to be the CEO of the company. The company was struggling a little bit at that point in terms of capital. We were having a problem in getting enough capital to continue out the growth of the business plan we had developed, which was pretty aggressive at the time. And I told the founder I would be happy to step into that role. I said, but you've got to assure me that you're going to be able to get the capital that we need. And he did. He assured me. that we could, or that he could. And it turned out it was much more difficult than he expected it to be. So eventually, we ended up having to wind that company down and sell it back to AT&T. And so then I was trying to decide what to do next, and I got recruited again by a neighbor of mine who was working for a marketing company in Charlotte. And they were looking for somebody to come in and help with the growth of that company. And so They hired me to be their COO and CTO. And I grew that company over the next 9 years from about $3 million in revenue to $9 million in revenue. And then in February of 2025, I had this idea of going back out on my own, starting a new company. And I had imagined a framework that I wanted to use to work with other companies on the growth of their company. And that framework I ended up calling the Strategy Playbook. So I went ahead and incorporated that company, but I didn't, I didn't leave immediately from the full-time position that I had. I ended up staying there until the end of September and then gave the owner my notice that I was going to go back out on my own. But I also gave him the option to continue to work with me on a contract basis to help with the transition. He took me up on that and we initially put a 2-month contract in place through the end of 2025 and then put another one in place for the first 3 months of 2026. So, I was starting off the Strategy Playbook with one consulting client already, which was great. In January of 2026, I was thinking about the framework that I'd built And I realized that I could actually turn that into a software application. And having owned a software company before, I came up with the idea to basically take the overall framework, put it into software, and we call it Growth Vector. And the way it works is it asks the owner and their team who would be working with an advisor on, you know, the growth of their company to basically fill out an assessment across 8 pillars of the business. And in each of the 8 pillars, they're asked to rate themselves on 8 categories in each pillar. And then in addition to that, we ask them to upload files that are specific to those pillars. Would you like to know what the 8 pillars are?

Yeah, absolutely.

Okay, so the first one is financial performance. The next is customer base and revenue quality, operations and process, leadership and team, market position and growth potential, intellectual property and assets, legal compliance and risk, and finally exit preparedness and deal structure. So the idea is we want to get a subjective analysis of where the owner and their team think they are in each of those 8 pillars. And then we want to collect data in each of the 8 pillars. So in the financial performance pillar, for example, we're asking for 3 to 5 years of financial statements, P&L, balance sheet, cash flow statements. AR and AP aging reports and so forth. Over in the operations, we're asking for their operational processes, right? In legal compliance and risk, we're asking them to give us the insurance that they have in place, any kind of IP protection that they've already put in place. So we do that across each of those 8 pillars so that in addition to that subjective analysis, we can get a data-driven analysis. And the Growth Vector software uses AI on the backend to analyze through all those documents. So, I mean, we're literally collecting 40 to 50 documents, you know, across all the pillars. So, it's able to go through and pull all that information out. And then based on a 7-stage AI agent that we've built, it's able to take that information and put it into The strategy playbook, and it provides three main things for the business owner to look at. The first is an exit readiness scorecard where it gives them a score in each pillar as well as an overall score on their current exit readiness. So that's a quick look. It's color coded. They can see how they're doing in each pillar, which pillars may need some work. The second thing it does is it gives them a current valuation. of the business, and it is using their NAICS code to go out and find what is the range of multiples of a recasted EBITDA that businesses in that specific industry have been selling for over the last 2 years. So not what they're listed for, but what they actually sold for. So from that, we get a range of the multiples of the recasted EBITDA, a low end and a high end. And based on that exit readiness score that we determined, we place them in that range. So we give them a multiple and then we're able to calculate what the valuation of the business is. We're also able to calculate based on the highest multiple what a best-in-class business is in that industry and then show the business owner, this is your value gap. This is how much money if you were to sell your business today, you're going to leave on the table. But if you have the time and want to work on the specific issues that we will identify for you, you can gain that value when you eventually do go to market. And so then the third thing is an actual strategic roadmap where we give them specific concerns and specific next steps in each of the categories. So over all 64 of those categories, we're giving them the concerns and next that they would need to do in order to address those concerns. And we show them what the value impact is. Will this particular one help you increase your multiple, decrease deal risk? Maybe it does both, increases multiple and decreases deal risk. But the net of it is that when they do address those concerns and they improve those areas, they're moving that category And therefore that pillar towards best-in-class. And the closer they get to best-in-class, the business starts to grow because now they're using best-in-class processes, right? And so the business will grow over time even before they get to the point where the owner decides they're ready for an exit. But it also gives them options because at that point, maybe the owner gets approached and PE's out there and they're consolidating different industries and—

Yeah.

You know, maybe they approach the owner and say, hey, we're interested in acquiring your business. Would you be willing to have a discussion? Well, if you're already exit ready and you're best in class, you kind of control the narrative of that conversation. So why wouldn't the owner say, sure, I'll have a conversation about that, right? Yeah.

So super interesting and some great things to unpack there. The first is you talked about this concept of the value gap. And I think this is something that business owners so often sort of overlook as they're thinking about, you know, what is my business worth? What's the size of my business? And a lot of times companies are sort of obsessed with kind of top-level revenue or maybe even kind of bottom-line EBITDA or, you know, free discretionary cash and things like that. But I've seen, and I'm sure you've got some examples of this as well, where 2 companies with essentially the same EBITDA in the same industry are worth quite a bit different because one that's operating at a best-in-class level across some of these 8 pillars is able to command a much higher multiple than a very similar business that's just not operating on a best-in-class basis. Talk to us a little bit about some of the missteps that companies make. Maybe you see some common patterns within those 8 pillars where companies are not maximizing the things that do make them as valuable as they could be.

Absolutely, Marc. So, what you're referring to, I call the intangibles. Those are the things that are not necessarily financial related. Some of them are process-related, but they're the things that business owners tend to overlook. So, for example, you know, the normal journey of a business owner when they start a business is they end up doing something that they're really good at. They're able to go out, they're able to make money at it. And of course, you know, they start out as being the business itself. And then as they're able to grow, they hire people that can take some of the things off of their plate. But normally what we end up seeing is that those business owners stay in the middle of many of those pillars of the business. So maybe they're really good at the customer side of things. So they're the main salesperson. They're out there, you know, handling any issues that the customers have in terms of the quality of the service or the goods that they're providing. So they tend to be the key person in that role. Or maybe they're really good at operations, so they hire somebody else to take over the sales and now they've offloaded that, but they're right in the middle of all of the operations and they're making all the decisions. So, one of the intangibles is the owner's involvement in each of the different pillars. And that, if you think, one of the things that I always try to tell business owners is think about this from the standpoint of the person who wants to buy your business, right? So, if they want to buy your business, And you're in the middle of the sales. You're the main salesperson. Now, they either have to like sales and want to go in and buy a job to be a salesperson for the business that they're buying from you, or they're going to end up having to hire somebody and put them in, and that's going to take them some time and some additional capital for, you know, to accomplish that. So they typically want to buy your business because it's a good investment, and they don't want to buy a job. Not true of all buyers, but True of many of the buyers that you would potentially get your business in front of. So that's one of the things is that owner involvement in those different areas of the business. The other one is, you know, do you have documented processes and are they followed by everybody in your business? So do you have repeatable processes that, you know, because you've already vetted the process, you've already run into the issues, that you potentially could have with that process, and then you've built in changes to the process to make sure that you don't end up having that issue again in the future. If you don't have those things, then they're coming in and there's no standardization, and so they're going to have to put all that in place. So, that kind of thing devalues what they're willing to pay because it's additional work that they're going to have to do once they buy the business and become the owner. So those are some of the intangibles, you know, protecting your intellectual property. If you've got a really good brand, but it's not trademarked, you know, then that can be an issue. So those are all things that we refer to as deal risk, that when the buyer is looking at that business, is it going to have deal risk and will the buyer use deal risk to discount the offer that they're making for the business?

Yeah, well, and that, that lens of thinking through the risk associated with the business, uh, is so powerful because it really changes the perspective of, you know, a lot of business owners are like, I have— I've built this great business, it provides a great life for me, surely someone else would want to buy that. Uh, and what they don't think through is the risk of Well, if it's dependent on you to go out and make the sales and you don't want to be the top salesperson for the new owner, well, then there's a lot of risk for that new owner that maybe they're not able to go out and make those sales. Likewise, we see a lot of companies overlook like customer concentration. Maybe you're highly dependent on one or two businesses that are your customers. Yes. You've had a longstanding relationship. There's no reason to think it's going to go anywhere, but there's risk there because of that. Or even just sort of the nature of your cash flows. If you have sort of, you know, episodic or reoccurring instead of recurring cash flows, that creates a lot more risk for a potential buyer too. And just thinking about those perspectives changes operational decisions that, you know, businesses can make. On an ongoing basis to pull the founder out of some of those sales conversations, to raise up the value of some of your mid-tier customers so that you're not so dependent on just those top customers, to think about ways to make recurring revenue instead of just episodic revenue. Like, just that perspective changes a lot. And even if you're not really thinking about selling the business or exiting on the near term, if you're building enterprise value, that enterprise value is an asset that you can borrow against. It's an asset that you can take investment into so that you can grow and scale and do more things. All of those same things really are the goal of a business owner is to create that enterprise value, not just Yeah, and you make a really good point on the customer concentration issue.

So, if, if a large percentage of the overall revenue is coming from just a few large customers, and on top of that, if the owner is the main contact, is the one that always calls on those customers and handles whatever issues and everything, and then the owner leaves, Well, who's to say if there's no contract in place that those large customers are going to stay on board, you know, following the sale of the business? And then, you know, on top of that, if you want to fix that issue, that customer concentration issue, that's not something you can fix in a couple months before you go to market.

Right.

So if that's one of the issues that a business has, that's something they want to know about years in advance because it does take time to address customer concentration issues. It takes time to address switching from episodic revenue to that recurring revenue if you don't have customer contracts in place. And of course, having customer contracts in place is great when you get ready to go to market with your business. But if you don't have those in place, it does take time to put those in place, right?

Yeah.

So you have to, if you're gonna switch a customer off of no contract onto a contract, they need to see some value for doing that. You know, what's in it for them besides locking them in long term, right? So, so you can't just do that in a last-minute ditch effort before you go to market.

That is true. There are, I have seen though, some even short-term initiatives that can make a big impact. We worked with a SaaS company that had some pretty high customer concentration, but they had a pretty robust bench of kind of mid-tier customers. They were just sort of heavily reliant on a few top-tier customers. And so we did like an upsell and cross-sell sprint, essentially, where we looked at all those mid-tier customers, thought about what's the next best offer we can make to them, how can we really grow them. And through a really concerted effort over the course of about 60 days, we were able to dramatically lower what the overall portfolio looked like from a concentration perspective, while at the same time generating some testimonials and referrals because we were having some follow-up conversations with some of those mid-tier customers, really deepening the relationship that they had with them. So, it had multiple benefits from doing that and meanwhile, you know, raised the overall valuation.

And that's a great point that, you know, reminds me that This is something that you just mentioned that business owners typically won't come up with on their own as a solution to that problem.

That's right.

So working with an advisor on the growth of their business, on getting their business exit ready, is crucial to the success for that business owner. The advisor brings in experience, different perspectives that they're able to help with the different solutions that might need to be put in place. And, and yeah, you're absolutely right. Sometimes there are good short-term solutions that can be done. You know, I mentioned customer concentration is one that typically takes more time, but if you don't have documented processes, you can get documented processes pretty quickly. You know, there's a lot of things that you can put in place that don't exist, but the owner and their team need to know what are those things. So, that's one of the things that Growth Vector helps them with is it gives them the full layout of everything across all 8 pillars that are concerns and what the next steps are to fix them.

That's right. Well, and the other benefit, you know, there's sort of 2 benefits that come from working with outside advisors. Not only can they oftentimes bring ideas, and a lot of companies grew to where they are based on, you know, long-term employees that brought a lot of domain expertise and a lot of commitment to the business. But they've not seen other ways to do it in maybe 5 to 10 years versus an outside advisor that's working with lots of different companies, is seeing lots of different ways to do it, can bring in some fresh perspectives. They're staying at sort of the, the front edge. The other thing is those advisors don't have some of the emotional baggage, some of those Sacred cows, if you will, that build up within a company that sort of starts to create some you know bright lines that no one will cross or no one will talk about just because that's the way it's always been done. That advisor can bring that in without that sort of emotional component to it. And then the other thing that people don't talk about all the time is hiring an outside consultant is a one-time expenditure, and so you can actually add that back to the value of the organization if you are heading into an investment round or. Or a founder exit versus taking a misstep on an advertising campaign. You can't add that back.

True.

And so, bringing in an outside advisor can actually really make an impact, not only because they bring in all these additional insights, but also because the new level of operation allows you to take advantage of that. And then you can add back the cost that you spent on them versus the cost of learning on your own skinned knees and bruised elbows.

You're absolutely right. And you can calculate the return on investment for bringing that advisor in based on what the value is that you're going to end up adding to the business that, you know, both before and during the time that the owner goes to exit. You can calculate what that return on investment is, and it's usually a pretty high return on investment.

That's right.

And another good point as it relates to using an advisor. In fact, we actually will not allow owners to use Growth Factor as an assessment tool to implement it on their own because of many of the things that you mentioned. But the other thing is that, you know, even though they have these things now that are laid out that they need to work on in the 8 pillars and in all the categories across the 8 pillars, They still have a business to run, so they don't suddenly have all this time available just to work on the concerns, right? They've they've still got customers that they have to fulfill. They still got you know fires that come up from time to time that they have to fight. So they're not able to spend 100% of their time on working on these things. An advisor comes in and helps to keep them on track. They look at You know, what's your timeline? What are the other things that are competing for your time? We're going to work. We're going to take a portion of your time, and we're going to work on these things. And I'm going to help you stay on track with doing it. An owner may come in and think, I'm going to I'm going to do this myself and save money and not bring an advisor in. And they'll probably, you know, do that for a couple months, and then they'll get busy again on the other things that their business requires. And they'll stop doing those things. So that's why we believe it's really important that they need to work with an advisor on the implementation of this.

Yeah, for sure. Well, Ken, you're obviously an expert in a lot of really interesting topics, and we could talk all day, but I got to be mindful of your time. But before I let you go, like, tell our audience, who exactly do you work with? Who should reach out?

So obviously the Certified Exit Planning advisor community. I'm a CEPA myself, and so any CEPAs that are out there that can benefit from using Growth Factor as an assessment tool. When you do it the old-fashioned way, and the way that I used to do too, we'd go out and we would interview the owner and their team. We'd identify all of those issues through the contents of those interviews. We'd look at their data, their financials, and their processes too. But we would do it all manually, and it typically took 20 to 40 hours of time to distill that information, put it into some kind of a report to say, well, here's what we've discovered, here's our plan for the next steps to address things. So what Growth Factor ends up doing is it simplifies that for the advisor, and basically they don't have to spend 20 to 40 hours The owner and their team are answering the assessment questions. They're uploading the documents. AI is creating the playbook, and from there they're able to go and have that review with the owner and their team about here's what we found and here's the next steps. So it helps them to grow their practice, and it helps them to be able to have that in the SEPA world. They call it the triggering event. But to be able to do that much, much easier, and then from that to be able to get a consulting agreement in place. But the other, the other group of folks that we work with are going to be growth consultants. So anybody who is doing growth consulting with a company, anybody who is coming in as a fractional C-suite and is at least as part of the area that they're responsible for wants to be able to analyze it very easily and determine, you know, as a baseline, where is the company today and what are the things they need to help work on for growth. And anybody who's coming in in that role is typically there to help the company grow. So that's one of the reasons why we came up with the tool. And those, those are the types of people that we work with.

Fantastic. Well, and Ken, what's the best way to get in touch?

So the easiest way is just to reach out to me at ken@growthvector.ai. That's— you can also reach me at ken@thestrategyplaybook.com.

Awesome. Well, Ken, thank you so much for taking the time to join us today. I learned a lot from our conversation. I'm sure our audience did too.

Mark, I appreciate you having me on the podcast today and appreciate all your time that goes into doing this. So thank you.

Talk to you soon.

All right, take care.

Thank you for joining this episode of the B2B Growth Blueprint podcast. We hope you've gained insights to grow your business. If you enjoyed this discussion, please rate, comment, like on your favorite platform, and share to others who will find it useful. Do you know a CEO, founder, or leader at an early-stage B2B services, tech, or SaaS company who would like to be a guest and share their story, send us a note. Let's schedule a conversation.