Fire Yourself First - Jeff Russell

We're talking about the first person you should fire in your business. Today's conversation is really all about how you are the person that should get out of the business probably before anyone else. I know there are many days you wish you could fire yourself right when you're just like, how do I get out of it? That's the subject of our show today. This is a really great topic for so many of us. How do you get out of running your business so your business can actually grow and thrive so you can increase the value? Of course, there's real compelling life and business reasons for doing that. And that is all about our show today, Everybody. My name is Bill Gallagher. I'm the scaling coach and host of this scaling up business podcast. Our show comes to you every week with something to do to help you grow your business, get your people right, dial in the strategy, execute better, optimize the cash and survive the process, maybe even enjoy the journey of scaling up. So you'll find information about our show, the back catalog, over 500 episodes and more, all of our resources and our coaching programs@scalingcoach.com ScalingCoach.com is where you'll find all that and that's easy to remember. Hopefully a website for you to go to to find all that. All right, so if you're watching on screen, you can see he's already here. I want to welcome the show Jeff Russell. So Jeff has run a lot of different businesses and he's grappled with this and he wrote this book, fire yourself first and, and it lays up a four step plan. God, we love four step plan. Four stages, three secrets. Like, you know, these are things that cause it helps us to remember. But how do you free yourself up to focus on the things that really matter, where you're adding value and not just being busy with your business. Right. Over the last 20 years, Jeff has taught this kind of thing to many other companies to start and run their own businesses. So welcome to the show, Jeff.

Thank you very much. That's honor to be here, Bill.

Yeah, it's really great. Where, where do you join us from today?

Scottsdale, Arizona.

That's what I thought with that area code on your phone there that you'd be joining us from sunny Scottsdale. How is it there today? I'm beautiful. Yeah.

Yeah. Rainy, nice, 70 degrees and sunny.

Oh, that's awesome. Well, I just got booked to do a bunch of accelerator training days for our earliest stage companies. I'm going to be doing those for the next year or two in back. In Arizona. I've done that in the past there, and I'm. I'm excited to get back there and do those again.

Yeah. So fun place. Growing, growing, growings.

Yeah. So talk to us about your background and what led to writing this book. Like, you know, it takes something. There's a life journey. Probably started with selling something as a kid. And give us a little. The. The story of your life that led to this kind of a book.

Well, you know, I was not born into the Rockefeller family, so my dad was in the army, so I was an army brat. And we moved around from base to base every three years. So entrepreneurial ship was not anything I was taught from my parents, but it's something I did pick up. Right. So I'm like, yeah, I was mowing lawns, painting whitewashing fences, delivering newspapers back when that was a thing. So always started small like that. When I got into high school, though, I started. We used to. We used to live in a small town, and we would go to a big. The big city every month, and I would go to the swap meets and. And auctions, and I would buy car stereos, brand new and pioneer and all that. And I would pay like 20, $40 for these new ones. But what I discovered was if I sold the new ones at my high school, like, I put them in the back of my car, open up the trunk, and, you know, you could buy. Pick your stereo right there, and I would double my money. But the funny thing was, people, they were like, oh, okay, this is just a stereo. They wanted more of a story behind it. So what I would do is open up the package and I would scratch them up with like, a screwdriver to make them look like they were stolen. And then if it was a stolen radio, then that was way more exciting and people would pay more for that. And I'm like, really? And so I was always very keen to see or be observant of what people wanted. And a lot of times it was the story, right? Like, what's the story behind things? So from there, I did what. I was the first in my family to go to college. And, you know, that's funny.

You're inventing stories to get around that. Of course, we saw that with marketing and things in the 80s with things like the Sharper Image catalog. And Tallheim would write these whole long narrative about products, and we saw that with other catalogs as well in that time that you had to get that whole long story to get yourself immersed in it. I love, though, that you're inventing. I think most people selling a stolen car stereo would want to invent a story about how they got it legitimately. And until you're inventing a story about how it's stolen, to add a little something like that, that is hilarious and very unexpected.

Yeah, it's kind of. Well, a lot of unexpected things happen, right? We had no money, so I got scholarships, went, got accepted into law school. After the first year, I'm like, yeah, I cannot sit, you know, in a library and like, do case law. So I quickly quit. And back then they had travel agents, right? Like, that's how you would book your vacations. And there was this one, I grew up in Southern Florida where it. They had Club Med brochure. I'm like, that looks amazing. That's where I would like to go. So putting myself through school, I was a DJ at night, because I could do that at night. And so I sent my mixtape to Club Med in New York. They hired me and I dropped out of law school, became a DJ for Club Med in the Bahamas. And there, you know, you really make your parents proud when you do that, right? So there again, there's the story continues. The whole. This is in the 80s, right? So the whole Club Med story and the exotic ness and, you know, so that was where I really learned to create experiences for people because they were very much choreographed the entire day, even into the evening, 2, 3, 4, 5 in the morning. And so the experience was very. And one of the interesting things was we all ate with our. With the guests. So it isn't like you go to the Hilton or the Ritz Carlton. You don't go to the dining room and eat with the bellman, right? But here we were all told you have to be with the guests. And. And that builds the connection. And I do that when I do my live events. Even today, I always have tables of eight where people can interact and communicate with each other.

And.

And I learned that in the 80s from Club Med. And so it was then, you know, that was fun. Then I went to, got my computer science degree because that's what you're supposed to do, right? You're supposed to work for a big Fortune 100 company. So at the time I worked for Xerox. They were one of the big employers back in the 80s, and they had the tech park, right, where they invented the mouse and the gui. So it was very exciting, technology wise. So, so I did that for a few years. And then I realized, you know what? I'm not really employable. And I didn't know it at the time, but I would always, after about three, four years, kind of get a big healthy package to go away. So laid off because I always did really good work. But I have very short, you know, if people are kind of doing dumb things, I'll tell you. So I have no filters, which is probably not a good thing when you're in corporate America. And from there I had counseling and they said, you know, Jeff, you shouldn't get another job. You should start your own business. I'm like, okay, I don't know anything about starting a business, right? I've not seen that in my family. I didn't grow up in an entrepreneurial family. And they're like, well, you have two, two journeys you can do. You can go franchise or you can do like a business opportunities type of business, and they'll both teach you how to run the business. And so I chose operations and I became a leasing broker. And from there, one of the things that I learned very quickly is if I financed a doctor, he got a quarter of a million dollars with his signature within 24 hours. If I financed a non physician like a regular person, it would be like 16 years of tax returns and they would want mortgages and pulling credit reports and more credit reports. It was so difficult. So I lear very quickly to follow the money, right? And I did doctors is I could do 10 transactions, make 10 times more with physicians than doing regular, you know, entrepreneurs. So that's kind of how I went from a dj, you know, selling stolen stereos out of my back car and following what people wanted, right? And. And from there, then the doctors were asking me, well, how do I use this cosmetic equipment? There's a lot of. It was cosmetic lasers and. And that type of equipment. And I'm like, well, you know, from there I'm like, okay, if I go and talk to the doctors. Already helped. I created a course that they would actually attend. And since then, we've trained over 30,000 physicians on how to add esthetics to their practice. And so I always kept that one. That was my first company, was the financing one. I've got five now. And, you know, they've all kind. I've invested in other businesses and clinics and things. So that was the straight story, right?

So, yeah, it's a good background while we share the DJ thing. Although I found the DJing pretty entrepreneurial because I'm like, okay, how do I make some money from this? Well, I have this radio show, so now I need to go sell a night at a local nightclub. And then I need to go do this. And maybe if I help promote a show, then I can get some part of the door or that kind of thing. Like, you know, so it was also in the 80s, but, you know, and of course it's a lot of fun right at that time of life. You're like, you know, some of our listeners weren't born 80s, But Club Med, Xerox. You had some great experiences to set you up with things and being at like, really interesting place and time. So then why this book?

Well, I've been. I decided three years ago I was going to work 10 days a month. Like, that was my thing. I'm like, you know, because one of my businesses, I was offered 10 million for which was a fair valuation. And in all intents and purposes I should have taken it. But I really love that business. And I'm like, okay, why would I sell that business? Just because I'm supposed to build it up and sell it. That's what you're supposed to do. And I'm like, well, I want to keep this business, right? And because it pretty much runs without me. And I discovered on one of my other businesses, 11 years ago, I had a full time job, my partner had a full time job. And so we had opened a cosmetic clinic. And we're like, how are we going to do this? So we actually hired nurses to run it. And then like 11 years later, we look back and I'm like, oh, we created an atm. Like, this business makes money whether we're there or not. And it makes, you know, it's a seven figure business. I'm like, this is a good thing. And it actually turned into my partner's retirement, her retirement plan. And I'm like, you know, if it's her retirement plan, that could be, you know, mine as well. So I looked at my other businesses. Automated everything got the right people in who enjoy working on their own. And then from there I was, I was set and done. And what happened was August of last year, or 2022, we had a physician who was coming. They were an emergency room doctor from Flagstaff. And so they were driving down, which is about, you know, three hours away from Phoenix area. And on the Friday there, you know, the class started and I noticed we had one set of books in the back, so somebody hadn't showed up. I'm like, okay, it's a physician er, so they probably had to pull an extra shift or something like that. And then I. Saturday, same thing. I'm like, oh, okay. I can see missing one day, but the weekend, you know, it's an expensive program. I would think they would come. And so I, you know, we called in like, hey, is everything okay? Did you get in a car crash or something? You know, we can schedule to the next one and nothing. And then maybe a week ago her husband called and was going through her emails or voicemails and said she had actually committed suicide three days before the event. And her whole thing was she was so beat down by the medical system. By going through Covid, dealing with everything that was going on. Her out was to add some cosmetic procedures to balance the medicine and the grind that she was doing. And at that time I realized, you know, a lot of people were coming to learn how to do aesthetics, like these doctors who had no business experience at all because they felt there was no other way. And that was the time I sat back and I said, you know what, I need to write a nice easy four step program of how to turn your Life into working 10 days a month. And so I did it. It wasn't difficult and it didn't start off, you know, 10 days. Right? It started off with 25 days. 20 days.

Let's underscore that for a minute because I think a huge amount of our listeners and viewers got into their business, whether they bought it, joined it, started it, whatever, because they had some domain expertise, they knew something about something, they knew something about medicine, they knew something about construction, they knew something about running a restaurant. They knew something about some thing, some industry, some segment. And so they're like, this needs doing and this is value. And I could do this and I could build a business around it and I could hire some people to help me and. But they lack the, the basics of business. They've been in one industry or maybe two, but not that many, and they never learned business. And even if they went to business school, like if you get an mba, it doesn't actually tell you how to run a business. It's all about the numbers and finance and markets and economics and a lot of other stuff. I mean, there's things in there about leadership, but, but for the most part, not the practical, just operations kinds of things. And you've got to go kind of learn that on the job. And if you run one and then you don't know that much about that, so you try and invent things and you come up with all these cockamamie ways of doing things and you miss all kinds of things that other people before you have learned. Right? Like so useful to stop and go, okay, how do I start a business that I actually care about, that I know something about, but. But not enslave myself for the rest of my life to running that business? This is the biggest problem in North America, right? Like, if you're, I don't know, a French entrepreneur, that those two words, although it's a French word, they don't often go together. But an Italian business, like taking time off, even the Germans who are known for business, take loads of time off. But in our country, in our culture, it's very hard to do that. And, And a little bit, maybe a little bit less on Canada, but good grief, the United States is just. Just struggles.

Yeah. And that was, you know, I guess, when I had my two issues. Like, first, I was making a difference in people's lives and I didn't realize I was because to me, this is second nature. It's just like, yeah, I know exactly how to create a business. I know how to hire people. I know how to read financial statements. I know how all been doing it for 20 years. But for them, it's all new and it's overwhelming. So even if you kind of do that, you still have to have a bigger picture of where you want to go than where you're at today. And that was where. When I was offered the 10 million, what would I do? So as a business owner, all of your listeners, if you were offered that check that you didn't have to be in your business, you were exited, then what would you do? So fire yourself first is more of a frame of mind. Because I'll tell you, I have friends who've sold their companies for 40, 60 million dollars, and six months later, I'm talking them off a ledge because they can't. They have got nothing. They did not have a plan when the baby was gone that you created. And so you owe it to yourself to actually create a plan where you're now only the strategist. Right. Or you have a very limited. And I think when we put something like you can only work 10 days a month in your business, that forces you to make sure you have the right people in place so that that business can run without you. Then you can decide, oh, I want to buy another business or I want to take time with my family or do whatever you want. You have that option. So you're right. You said earlier, people built it up and they feel that they have to be in it, grinding it. You can grind it at the beginning, but not later.

Yeah. Or when you do something new you launch a new division, a new product or whatever, jump back in, work hard, but not with the regular day to day, you know, the stress. Like you talk about a fairly dramatic story, right? Sarah, who gets so stressed, she takes her own life. And, but, but even if it's not that dramatic, and I've known some who've been very close or attempted it because they were so overwhelming, but also because their identity was so tied to their work. Right. And, and just like parents whose kids, you know, go out in the world, you become an empty nester. You're like, who am I if I'm not a, a dad in that sense, right? A dad of. I'm a, I'm a grandpa now. But you know, the first thing that happened when the kids moved out of the house and went out in the world on their own, where they went off to school or to work or is like, wait, what do I do with my time? And it's even more of. That one's even more of a challenge for women. For men, it's maybe a little bit more tied to career, but it could be either way. For, for you, you're like, who am I? What do I do? What's my role like if I'm not running and pushing and bossing everything, Right. You start a company with your speaking, but then how do you pull back and let other voices and contributions rise up? That's a real, like a core challenge, I think.

Yeah. And that was my biggest challenge too. And so when I decided. So When I turned 50, I discovered that lists of 10 are way too big. So I'm four things or less. I tried two, three, four things. I'm done. So that was a few years ago. So my first one was your per. You got to find your personal purpose bigger than your company. And this is a really tough one for business owners because you, as you said, everything's tied to your business.

Very few people, right? What's your. Why. What's the purpose of your life? Like, if you're religious, maybe you have like a doing God's work or something like that. But you talked about a health care provider. Tell that story about the health care provider.

Well, for, for one of our providers, again, just grinding it. Here's a success story, right? Grinding it, grinding it. And I'm like, okay, for going to school and taking half a million dollars in debt, right. If that's what you get to start with, right. And then you're just, oh yeah, you're grinding it. Oh yeah, we need you to do a double shift we need you to do this, right? Oh, and then you've got the patient who's jumping over a gurney trying to bite you because you're trying to help them, right? This is not a, like, you know, you have to really kind of, it's, it's almost, it's sad, right? And they're like, you know what? I divorce. Done. Okay? Now I have, I'm remarrying. And so your family's a mess, everything's a mess. And then what was it for? Right? So it has to be bigger. And why do most physicians go into medicine is to help people, right? They want to help people, but what they really realize is they weren't getting any help themselves, right? The system does not help the doctor treat in these crazy environment. And so the big thing is they actually had to look beyond them. What, how can I help people, but not how I'm doing it right now. And so they came to one of our trainings, did the course learnt and just step by step, I'm always, don't quit your day job. Start with one thing, friends and family, and then grow it from there. And then this person now has a huge multimillion dollar clinic with lots of people in there working it and has been in business for over 10 years and now is doing what they want to do, right? Charity work. They like to give back to the community and they can do that. They do medical missions to Africa. They are able to do the things and help the people who really want to be helped and who need to be helped as well. So just thinking outside the box, but the key was you've got to utilize and leverage your business to act. I think this is a crude but effective metaphor, like an atm. It has to be, there has to be money in there whether you're in there or not. So what are you going to do to do that? And like I came up with my own personal purpose statement was to make a positive difference in people's lives by encouraging them to see what they cannot see by serving as their guide. And so that's what I try and do. Doesn't have to be in finance, it doesn't have to be in medicine, it doesn't have to be in any specific, specific industry. But if I can enlighten and show someone a better way and the light bulb goes out, love it. That's, that's kind of what I'm put on this earth to do is the grinding is done.

I think that's a really useful thing to do to figure out. And then Create a simple statement around like what is it that you're really proud of that you really find deeply satisfying to do? And it's generally about contribution for most of us. But it could be about creating beauty or it could be about, about play or it could be about knowledge or. But there's a lot of helping and whatever it is that you really find important and deeply mattering when you give it away or it's not just selfish, like it's broadly for humanity that is in the direction of, of your purpose, your personal why. Right. That, that thing that you find very fulfilling.

Yeah. And I think most business owners went into business to solve a problem.

They.

Which was to help somebody solve a problem. Right. So I think having that core belief, the money I find comes if you provide an exceptional service and you really do good work and then the word of mouth will grow. So I never do it for the money. It's always to help people solve a problem. And so for me, I was actually the, the cognitive slowing my system or my business down because I wanted to be involved in every decision. Well, that was actually the worst. I was actually slowing myself down. The other benefit that a lot of people don't think about by firing themselves from their business is that you actually increase the valuation of your business because businesses that don't require the owner to be there sell for a much higher valuation and multiple than businesses that require the owner.

Owner.

And so for me, do it for your own good.

That's a key thing. Your company is actually worth a lot more if you're not running it day to day. Right. So while you might be like, well, if I have to hire people, that's money that, you know, I'm going to spend and I've got my time, so I'm going to spend it. But you're actually reducing the value of the company. You're making it far less salable if you are central to the regular operation of the business.

Absolutely. And why do most of us create our businesses? We created it for legacy. Right. We may want to give it to our family, we may want to sell it. And that's going to be our retirement fund so that it can fund our future and our dreams and what we want to do in retirement. But then we're actually hurting that retirement. Like who would intentionally, you know, devalue their IRA or their Roth, right. By half or 80%? Why would you do that on purpose? And you're, you're kind of doing that on your business. So don't be selfish. Fire yourself from Your business.

So talk to us about your marketing coordinator and how that went and like how do you set up the team?

So the team for a business is going to run without you is different in the respect that you've got to really target traits that people are self started, self motivated and they gets, they don't need to be told and micromanaged. If you have a micromanager and somebody who likes and asks a lot of questions, then that's not something you know you want to look for. So I have an 11 step hiring process and it's actually available free on the book's website, fireyourself first.com you can download it. But one of the questions I ask is, one of the first steps is when I hire someone I look at two or three questions and one of the questions is what have you done to improve your knowledge in the last year? Now if they haven't read a book since college, right? Like that's not what I'm looking for because I'm looking for a growth mindset, self learners. So when you're going to set up a business that's going to run without you, it's very important that you hire people with a growth mindset and are self learners. How many books? Oh, I went on and I paid $99 on marketingprofs.com or whatever to get some great like you did that out of your own to do that. So I'm always looking for what is that? In my last role we hired a multimedia designer. I had 600 applicants. Right. So that is a lot to go through. And so again having that specific thing and it's amazing. Some people that have been doing this for 20 years were quoting back stuff they did in like I remember in college like 20, 30 years ago, I'm like, do you not use. If you don't use chat GBT in your daily job, you're up like boom, delete. So I was looking for oh, I like to. And then I'll ask you know, what do you use to help your, you know, to do more, right. So you using chat BT chat GPT is a huge plus for me because that means you're a self learner and you're leveraging technology to help do your job faster and better. So the person I ultimately hired, she had all these tools and she goes, I like learning, right. I went from nothing into here. I did a career change. All on her own. Nobody paid her to do a career change. She did it. And she was the one that I hired as the multimedia marketing Designer to do our work.

That's really great. Like thinking about and giving away the things that you're not good at first, the things that you're not central to, figuring out how to give it away. Hiring people to be autonomous. There's a lot to learn there and way more we could go into in future conversations about who you hire and that hiring process. But hiring capable people and letting them do their job I think is really the core of that. You've got a variety of businesses and you're looking at all of them and knowing that they run okay with dashboards and scorecards. But you said that in one of them, a clinic, there was probably the biggest difference. Tell us about that, how that went.

One thing that I realized is that the old way, and this is the negative thing of working for a big company like Xerox. And I also work for alliance and I work for Fairmont Hotels. Those are three billion dollar companies, right? Or I don't know if Xerox is anymore, but they used to be so very process oriented. One of the things that I, one of the bad habits that I took from them was that I would set, give them basically, here's your job description and give it to them and that's it, let them go. They actually didn't know what winning looked like. And so I have a dashboard for myself. So I have this dashboard that links in all my KPIs of all my different businesses. So I know where I'm at, where my leading and my lagging indicators. But I realized my employees didn't have anything like that. And they don't need 40 numbers, but they need two or three key numbers. And that's called the scorecard. And so for each role they'll have a key number. And so for this medical clinic, for example, one of what we discovered was this. For every five star review we get, we make about $10,000 a month in extra revenue. For every 0.1 we lose, we lose $10,000 a month. So if you're 4.6 to 4.9, that's the sweet spot. But if you're 4.4, 4.2, forget it. So all of my staff have a KPI. That is how many five star reviews have we gotten this month? So they know exactly what there is expected of them. And then how many patients or customers did you see last week? And so once they know that, okay, these are the three numbers I saw the revenue in that business increase 30%. And so something simple. So many people, and many of your employers are coming to work and they don't know what winning looks like. They don't know the three specific things. Sure, they know the big, you know, role scorecard of what's expected in the role. But those KPIs, you've got a really front and center and it's weekly. So we have, these are weekly reminders of either you do a huddle, right, every day, every week so that you know what's expected of you or you do a SL team meeting or zoom, whatever your company uses. But every week you need to have numbers that they know they can move that week. So if the last week was bad, no problem, we're going to move now. Not a month from now, not six months from now, or a year from now. But we have weekly numbers in the scorecard. So huge, huge thing. Let your employees know what winning looks like.

So a couple of things I want to underscore, I think that are really important there. You could keep coming up with new metrics forever. And I've definitely seen teams that have 20 different numbers they're looking at and it just becomes overwhelming. So the first thing that you said there that I think was really genius is three or four numbers, right? So there's definitely a most important number and there's, and there's this idea of leading and lagging. Like there's the outcome number is the most important number. We get the revenue, we get the profit, we get the cash, right? They're that kind of thing. They're often financial. But then there's an activity based one that's a leading thing that says okay, to get that revenue, how many leads do we need? Or how many proposals do we need to make or that kind of thing that's active. But then there's a qualitative one that says, okay, but at what margin? Right? Like if you drop the price to nothing, you could probably get a sell even more. But what's the point of that? So what's the qualitative thing? Or if you get the, the cost of goods so low but your defects run through the roof, what's the point of that? Right? Like if you process people through the thing, but then your ratings drop, that's a qualitative drop in the thing. And so there's always then at least one balancing, maybe two that makes sure that the whole thing ties together well, that you don't put. And this is one of my, like I made a multi million dollar mistake, somebody on my team did it, but I really let it happen by putting all my attention on Sales and winning items and things like that. And then taking for granted my production and purchasing and I bought stuff I wouldn't need for like 10 years through a whole mix and backstory and that kind of thing. But it was failing to consider what's most likely to go wrong. Right. Like where. What's going to balance this out? What if I'm focused on the sales, how do I, how much am I producing? Do I have enough production? Is it too much that not enough the other like. Right. And that is, I think, genius. And then what's the number at the top level? How do you know you're running your company? Well? And again, people have pages and pages of financial and operational reports, but it's overwhelming. Right. You ought to be able to go out of the country with 8 to 12 numbers and disappear and know that everything's okay because of what you see there on that, on that sheet.

Absolutely. And for me, I, I used to have like 20 numbers and now I have four. Right. Because I'm always looking for what's that one domino that. If that is work, that domino is working. Then everything else is working behind it. And so in each role has different KPIs, right. So my operations manager will have an expense, you know, percentage. Right. Where my sales people don't have that. They have leads incoming inbound. However you're going to do that. Even accounts receivable payable what they have KPIs. Everybody also has that five star rating, KPI. And we have, it's often called an NPS, a net promoter score. We ask every single person we do business with with us, would you recommend our service or product to someone? Yes or no. And it's that simple. Yes or no. And that's what we want to know. So that has to be 95%. It has to be, yes. If it's not, we go right to that person, we find out why. And often that's where our miss that's where our mess up is. So instead of wasting all this time and getting boards and getting a little, you know, let's get this little committee going. Forget that. Call the customer up, find out why he said he wouldn't. And that solves your problem very quickly. In 30 minutes you'll know exactly. And this could be the leading indicator of something big and is going to cascade to all your customers. So you want to be on that right away because maybe you made an operational change that is just starting to roll out and this is the first guy or girl that saw it and you've got to. You've got to be involved. What's that?

Let me just say, also with regard to that one that's so powerful, would you recommend? Right. And you could say, you know, how likely are you to recommend? And why did you say, and you can build it in a whole system, which is the Net promoter system. But. But the basic of that leads you to when people won't recommend to changes in your offering, your operations, your delivery, things like that. But sometimes it's people you shouldn't have done business with in the first place. Right? Imagine somebody out looking for a French restaurant who stumbles into McDonald's and is horribly disappointed with the quality of the cuisine and the lack of service at McDonald's. Right. I mean, I'm making up an absurd example, but that's a person who shouldn't have been at McDonald's in the first place. So every business has a right kind of customer. There's a famous story about somebody complaining about the way the flight attendants express some personality on Southwest. And the founder writes back to them and says, we will miss you, because he knows they don't belong on Southwest. That's totally contrary to the way they operate. Right. Knowing One of the possible answers is you shouldn't be doing business with that kind of a person. They're just not your customer.

Absolutely. Yeah. You know, there is that 20% you should probably be letting go now.

The ideal custom thing is your step number four. I think for many of us, and I work with so many companies, whether we just hear from them or they come to a workshop, or they're one of our ongoing coaching clients who want to scale their business, want to grow it, but they haven't thought about exiting the business. They haven't thought about selling it. They haven't thought about passing the baton about succession. And I was just talking with one of our clients this week, and he's got an issue with one of his people and one of his projects and that kind of thing. And I'm like, okay, but what if that guy got hit by a bus? Like, what if there was a meteor that took him out? Right? Like, so how would you deal with. And he's like, well, I guess we do this, this and that. We'd survive. Exactly. So you're not unable to make a change there. You could make a change. It's what. So what are we going to do about that? To make that more survivable, less dependent on any one person? Any. So what about your autonomous exit? How do you get out of that business? Talk about the colleague that had the concussion.

Yeah, so one of my friends, I sit on many boards and this person here had a hundred million dollar construction business and he happened to just be, he raced cars too. He was in his van that pulls the car and he was like tightening something for his race car and he lifted up and his head hit a shelf on top, you know, kind of dazed him but actually that progressed rapidly downhill and it basically gave, he couldn't work for two years now. Luckily he had a great team in place so he was able to survive. But now he wants that, he wanted to exit. Right. Like, and it didn't matter what, you know, at what cost. And so he basically is selling at the value of fire sale, the value of the asset. This is an asset sale. So here's a hundred million dollar company that his father created, has been in business for 40, 50 years and now it's going for a fire sale. Just equipment value because he didn't have, you know, and he's like, you know what I don't want to sell to, you know, I found a broker. Oh my goodness. One of the worst things you could do is before you sell your business, you do your own research on how to find a strategic buyer and all that. Because remember these business brokers, they just want to make commission. They do not care whether your business sells at 140 million or 80 million. They get a check. So so often, oh, the business broker, he'll take care of everything. No, the business broker wants the fastest, easiest check, the deal that's going to close the quickest and that's usually the lowest priced one. And so in, that's the route he went. And I'm like, wow. It's just like you never know when something is benign as a bonk on the head or a serious car crash or something could incapacitate you. But he didn't have a strong leader in place. He didn't have a right to run that business. Then he could have built up the financials and prepared it. So always be ready to exit. And so when you are, you're good to go. He didn't fire himself first three years ago, otherwise he would have probably got double or triple the amount that he ended up with just because the multiple went very, very low. Two times where the industry should have been closer to five or seven times. So always important, you never know when it's going to happen. So if your business is always set up that you have the option and trust me, you're going to sleep better at night because number one, you have a business that runs without you. It's creating cash. You got a team in place, everything's good. So that could, that's where I want to be for the next five to 10 years. And then when I'm 70 then maybe I'll shift that. My businesses are ready to sell and I already know who my buyers are to going, going to be. And that's the other side of. Is it if you did sell, who are those strategic buyers? Not the fire sale buyers who just want to buy you, but the people where you, if they buy you. One plus one equals nine. Right? You don't want one plus one equals two. Buyers is, they're not going to pay the multiple. But the one plus one equals nine. That's a huge one. There's one person I know, he had a, he had a yogurt. So he had a whole yogurt chain in Southern California. His strategic buyer was actually a milk farm. So like think of that. Because they wanted a distribution. So he got like a 14 time multiple versus 8. Because a strategic buyer, you never know who they are, saw more value in that distribution channel.

So getting yourself out of running the business is one of the things that fundamentally makes the business saleable. And then starting to think about who's going to buy it, how it's going to go, what part of your team remains on and who also exits with you. But do that thinking now, not later. I worked with a company a few years ago, it didn't go very well and the seller had been thinking for a few years about exiting the business as he got into his 60s. And then he talked to a buddy of mine who referred him to us. And most of our work comes from referrals. And they're like, okay, well you should work with Bill and you should put scaling up practices in and level up your leadership team and get a growth curve going and you've got a great retirement and then you can go off and do whatever you want to do and travel more. And he was like, great. But now he's approaching 70. And so we come in and we start to work with him for a little bit. And he had a team that liked working with him and around him. But now we want them to level up and be part of something that's going to bring in some others and take some new practices that would essentially allow him and the business partner to start to step out of the business. And they kind of rejected it. Right now he's really kind of screwed. They're like rejecting the whole thing. And he's not in a position to say no, I'm going to just fire you. He's, he's 70 now and oh so squeezed. Right. And anyway they, they, the whole thing got pushed back for years and I don't actually know how it fully ended up but the initial attempt, which would have been very easy thing to do, this was a great evergreen profit cash spewing business. Right. That should have been easy to extricate him from and the team kind of, you got to think about that earlier, right. And when it's less urgent than after you have a concussion or what. And, and like in any moment, right, he's just doing his little hobby and then he gets a bonk on the head. But you could do that with a ladder in the backyard. I'm always involved in stupid crazy sports, surfing and skiing and things like that. And I know that I am one like there's just like one misstep away from something and I'm, I'm almost 60, 60 this year. So that's like I'm thinking very carefully about how much all the time. Well, it's a really good conversation. There's a lot to think about. We're kind of at time here for, for the show. I want to let people know that if you want to know more, if you want to read the book and follow the process and start to figure out how to fire yourself, fireyourselffirst.com is the website and read Jeff Rosel's book, start to work through it. It's completely compatible. Jeff is a friend of Vern and a follower of Rockefeller habits and Scaling up and that kind of thing. So everything in this is totally compatible with our world. Be great for our, for anybody in our coaching programs, that kind of thing. So I highly, highly recommend that. So and while I mentioned it, big shout out to my friend and mentor, Vern Harnish who created the whole scaling up framework and the Rockefeller habits that came before it, my friend and mentor. And to the folks who help us get our show ready and booked and prepared and promoted each week, story on productions and the folks who edit our audio podfly and posted up up. So it takes a team to get these kinds of things right. I'm working on firing myself except for this part that I love doing, so all of that. Thanks again for watching for listening. If you want more information, drop us a note or whatever. It's info scalingcoach.com the website is scalingcoach.com thanks again for listening for watching. Thanks Jeff for joining us today. We'll talk to you all again next time. Keep scaling.