The First 90 Days — How Not to Wreck Your New Business

The first 2 weeks of owning a business are a whirlwind. You step in as the owner, but then what? What do you say to your team? How do you tell your customers? How do you start shaping the future of the organization? Today we're going to talk about what that looks like and why there is no one-size-fits-all approach.

Bought the Biz is a podcast for ETA entrepreneurs who've gone from searching for a business to actually running one. It tells the real story of what happens after the deal closes. The day-to-day operational, emotional, strategic and leadership challenges that just don't show up in the highlight reels.

The show is story-driven and practical, sharing real experiences from operators along with clear, actionable takeaways you can use in your own business today.

I'm Garth Fossano.

I'm Christi Loucks. Welcome to Bot the Biz.

Welcome back to Bot the Biz. The first 90 days after buying your business is one of the most exciting times in your life. You finally get to walk in as the owner, meet your team, talk to customers, and start building your future. Um, it can also be incredibly nerve-wracking. What do you say? How do you communicate this? And this is your real opportunity to set the tone and build the foundation for everything you've worked for in search. This is your moment, but There are so many questions to think through. Christi and I are excited to talk to you about some of them today here. So Christi, why don't you just kick it off? Tell me a little bit about what this was like for you when you stepped into your business.

Yes, a whirlwind is the short answer to that. I don't know. I think I feel like I had idealistic expectations around what stepping in as the new business owner would be like. I guess I envisioned it to be this like grand entrance and like this wonderful moment of like, oh my gosh, I did, you know, I did the thing, and like be swept up in all these like highs.

And when did you realize that was not what it was going to be like? Walking in, you've got like your, your music playing, the red carpet's rolled out, and then you're like, oh wait, like the record scratches and you're like, that's, that's not what this is like. When did that reality set in?

Probably day one when, you know, so we did, gosh, I'm trying to even remember. So I was like traveling when I actually like stepped in as on day one, I was outside of my home office. So I had to find, you know, a makeshift office for my first day and my first all hands call. Like I had, it was a lot of things. It was, not normal, right? And but still, I was like, okay, it's gonna be so amazing. I'm so excited to meet this team. We're gonna get on this call and announce the sale. And then, you know, at least for me, like, I had a face— or like a MacBook screen, little laptop screen, not even my big laptop or computer, but my MacBook screen of faces on Zoom just like staring back at me. And I think that's when the, like, the record scratch hit for me, was like Wait, who are these people? What am I doing? Why am I here? Like, what do I say? And it was, I mean, for me it was right out the gate. And then you have, you know, all the decisions you have to make and the business operations to start happening from there. But I remember feeling that immediately.

Yeah.

I don't know if you had the same experience.

I think probably the record scratch was, um, you know, I closed on the business on a Friday and Like possession was the next day and it was a weekend. And, and, you know, the seller and I had just talked about, oh, like we'll get back together next week. We'll start getting you access to everything. And I was like, wait, like it's Saturday. Like I'm responsible now and I can't even access everything. That was sort of the moment the record scratched and you're like, wait a second, this feels a little bit off. Um, and luckily there was a fantastic transition and nothing wrong there, but that was the moment where I was like, wait, I, now I am the one who's responsible and I really need to understand what's going on. And I think. A lot of the best-laid plans, you start to rethink some of that too. So I assumed, oh, Monday morning we'll do this big all-hands. And, you know, the seller was like, you know, I meet with my leadership team on Tuesday. Like, why don't we wait till Tuesday? And then you can, you know, we do a Thursday call with the rest of the company. We'll tell everyone on Thursday. So it was like somewhat anticlimactic, but also fit in more with the culture of what people were familiar with too, which I think was a good balance and something I wouldn't have been able to come up with on my own. So I think that's something a lot of buyers and new operators are going to have to think through. Like, you have this vision of like, yep, I'm here on Monday. And, you know, that might be the case if it's a, you know, business with brick and mortar. That might be more what it feels like. You and I both bought businesses where a lot of the workforce is virtual. So that, that makes more sense.

So you have one call on a Tuesday and then the next call on a Thursday.

Yeah.

And so who was on the Tuesday call?

The Tuesday call was the leadership team at the company. So there's probably of the roughly 30 employees at the time, probably about 5 were on that call. And the Thursday call was with the rest of the, the entire company. And then I started joining one-on-ones with the seller for— and we did those sort of overlapping for a couple of weeks and then she transitioned out. So I got to do one-on-ones with the leadership team, but I actually didn't do one-on-ones with the rest of the team until probably like 2 months later. Which I felt a little like I wanted to do them sooner. Some of essentially sort of like the, the GM or the next leader at the company sort of encouraged me to slow roll that. And I listened to that advice, but I think I probably should have done it a little bit sooner.

Okay, that's interesting because I tried to get one-on-ones immediately with the key players. Like I kind of, you know, stack rank people and say like, okay, this person's heavily involved in operations. I need to get there fast. And then it's not that these people are like less important, but just in terms of my priorities, what I need to focus on first, I'm going to get to these 3 people like this week immediately.

Yeah. So that's what I mean. That was probably what was in my head, but you know, we, and, and the, the sort of the, the, you know, I'll use the word GM because I think that's going to be the most relatable to the search crowd. Um, but the, the, the GM and I did, and the seller go have a lunch and get together. That I think it was probably like he, I think, uh, I can't remember if it was Monday or, but it might, that might've happened a little bit earlier and handled a little bit differently. Um, and so, you know, one of the key employees we did do that with, uh, for sure. But yeah. Um, I think, I think looking back, I would have probably done it a little bit faster, but also, you know, it worked like it didn't disrupt the business. We didn't sort of mess up any of the existing operations because you're gonna have this feeling like, you now are responsible for the business. If you go do one-on-ones with 30 employees, that's like a week of time you've taken out of the business. And so I was just very cognizant of trying to make sure we could still continue delivering for our customers during that period. And so that was what was— I felt sort of this, these, these two pressures, one to get out there, say hello to people, assure them that, you know, everything was going to be fine and this wasn't like the sky was falling. But at the same time, I wanted to make sure we were doing good work for our customers because that's ultimately what matters.

How many employees were like, how big was your team?

It was about 30 with like roughly 5, maybe 6 direct reports. Yeah.

Okay. Okay. And mine was a bit smaller. Mine was, oh, probably 12.

Yep. But you, you had some interesting dynamics in that too, because you have some folks international and I don't know if you tag them as they're probably contractors, but we're working pretty closely.

Yeah, they were. So a majority of the team was off-seas, off-seas, offshore is the right overseas offshore. And from multiple countries. So we had an India team and a Filipino team. And I mean, I've spent a lot of years traveling, working with people of all different, you know, culture, like backgrounds, et cetera. I'm not a stranger to like having to step in and you know, adapt to different communities, like communication styles and all that. But I will say being in, it's just different when you're the, it's different when you're the owner. And, um, there's so much more riding on the effectiveness of your communication with your team. And I definitely, I don't think I put enough, uh, focus on that right out the gate. I kind of just figured like, oh, I've, I've, I've, you know, worked with these kinds of people before. Like I've, I'll be fine. And I should have spent more time really crafting the right communication channel across multiple cultures. And that was one thing that I didn't maybe expect to have to do.

So that's a really interesting challenge to have to coordinate. And that's probably pretty unique too.

Yes. Yeah. And especially, you know, Indian culture versus Filipino culture is also very different, like very direct versus not, you know, the Filipinos are like some of the absolute kindest in communication, the type of people that I've ever met. Indians are just like, you know, they're very much more direct and you just, we had a very like clear-cut type of communication, both fine, both wonderful teams. I loved working with them, but just really different ways that I had to like get my points across. And then simultaneously, really different ways of having to distill what they were telling me in terms of like whether it's something they needed, here's how we do operations, here are questions I have, here's a problem and here's how I'm gonna articulate the problem to you. It was just vastly different on both sides. So, and I didn't, I don't think I spent enough time diving into that.

That's a pretty wild difference I would, you know, have to think through. I know that there was a very clear culture that the seller had set out in the organization that was pretty different than the way I was gonna to do things. And so starting to change that, you know, really took years. But I would also say I didn't probably try and change that, uh, right out of the gates either. Sort of, it was still a little bit more of an observe and learn and try and fit into the existing processes. I do remember in the, in the HBR book, the, the sort of the, the guide to how to do this, it does say like, say nothing's going to change, do all these things. And so, you know, but of course it's different. Of of course it's different. There's a new owner there and you come in with a different set of experiences. And just given the nature of the capital structure of the new entity, you're probably going to be trying to grow it. And so I think there is a question of like, do you be honest about that or do you, uh, you know, not be as honest about that? And, uh, I actually have a video recording of me practicing my intro and I sort of was reading the HBR book and it's very much, uh, following in line of that. And I think I I probably should have changed that a little bit more and sort of explained a little bit about my objectives to like why I was there and why I was excited and what I thought the opportunity was at that point as well.

Yeah, I kind of called BS on the whole telling people nothing's gonna change. Like, do you think people see through that? Uh, I, I would, but maybe they don't.

I think so. You know, what's really funny is, um, cuz you know, I, I, I teach at CU and one of the courses we did, or in one of the classes last year was all about the transition and what do you do? And we, You know, the homework, the assigned reading was this HBR book. And we did the first half of the class was discussion and dialogue. Like, do you agree with this? Would you do it differently? And basically the student said, no, like you've, you've got to be transparent. You got to tell them exactly what you're thinking. Um, and then we played my video, which was a really, really funny contrast. Cause I didn't really, I didn't even remember how I had actually done it. I think also just. To help people feel maybe more calm and comfortable as they go into this moment. Like, you're not going to remember that, your team isn't going to remember that. It's going to be how you act over time is really what they're going to believe and follow through on, I think anyway. And I do feel one of the things we did is we always treated people really kindly and sort of tried to find the right spots as the business is evolving too. So I think that we have stayed true to that in some ways, but I probably could have articulated it better at the time.

Yeah, because I think people can sniff that out to be like, okay, there's a new owner. Things are absolutely going to change. It's like somehow, right? Maybe not dramatically, maybe not right away. But I think the approach I definitely took was one of, I'm here to listen to you because you actually know this business better than I do. And I, I need your insights. I need your intel. I, you know, in order for me to even be successful. So I came in from that angle pretty strongly just to make sure everyone knew like, yeah, I, you know, there's a new kind of quote boss, but I need you to help me. And that's the first thing we're going to focus on as opposed to kind of coming in and being like, well, I'm here, but everything's fine. Everything's gonna be the same. Like, no, I need you to communicate with me. I need to know what's going on. And then things are like, going to change in some fashion.

Yeah. Yeah. So it's interesting. It seems like we had slightly different approaches where maybe mine was a little bit slower. Yours was a little bit like day one, here we go. You also mentioned like you weren't in your home office, like, so I feel like there's a couple of takeaways I probably have from this and like, if I were, you know, feel free to jump in. But I think, you know, before day one, which is going to be really complex because you're trying to close a deal at this point. So like at some point in your due diligence, you're also going to be having to write your, like, internal comms plan. So think through that across your key stakeholders and, like, what are going to be the best way to engage some of these people, especially employees that are critical to the business. Um, like, for example, you know, I had a lunch with the seller with a key employee. Um, I think the other part is, and, and, and, you know, I actually think I did something similar but not quite day one, but, like, be in your office, be in your setup, show, like, be in a consistent spot so that your team sees that consistency from you and that sort of presence. Like, you and I are both, we're both essentially virtual. So I didn't want to have a virtual background. I wanted it to be sort of the same spot all the time. I thought, I think looking back, I did do virtual backgrounds. So they just wanted an asset. Looking back, I should have like, should have shown a consistent, like, I'm here, I'm here to work. I'm going to, I'm going to be in the same spot. Whatever you need me, I'm here. So I think that those would be to maybe two of my recommendations. Do you agree with that? Anything to add?

Yeah, I would agree with that. Um, did you— let me ask you a question and then maybe I'll have an insight. But did you, on your kind of big announcement, let's say your leadership team, and then I guess you do the all-hands team, did you coordinate with the seller on what you were going to say, what you wanted to communicate?

I did.

How did you go about that?

I recorded practices of me saying it, because it was going to be on a Zoom call effectively. And I recorded it and I sent it to her for feedback.

Perfect.

Yep.

And she provided you feedback. It was helpful.

Yeah. She sort of, she said, yep, thumbs up, basically, I think. Uh, so you can decide how, like, I wasn't off track, but you know, it wasn't more guidance than that, but also it's not her job. Like that, that's okay. Like it's, yeah.

Yeah. And we, so I didn't do, I didn't go quite so far as to do like practice recordings of myself, but I did collaborate with the seller to say, okay, like here's kind of our plan. Here's your intro. Here's the handoff. Here's what I would like to discuss. And we kept it very light on the first all-hands call. It was more of an introduction, said a little bit about me. And then we just went around. It was, it was only 12 people. So it's not a ton. And we just went around and like did quick intros. Fun fact type of a conversation just to break the ice. But I would say, just to your point on like takeaways, I do think it's really important, assuming you can and have the relationship with the, you know, prior owner of the company to coordinate on that effort, because that I think builds some credibility for you to know that the seller's there supporting you on the call in the transition and your team is going to see that engagement and subsequently builds a lot of trust for you to come in and take over.

Absolutely. How long was your transition with the seller? Because I think that's like you just started to get into another topic, like how do you coordinate that, that, that process? You want to show sort of consistency and stability in that. So what was your transition like?

So we acquired in August and then I'm pretty sure, although I'd have to go back and look at our documents, I'm pretty sure through the end of the year we had it mapped out as a like you're available for questions, consulting kind of a role. You know, as I learned these operations, I did fly out to meet him and spend like a week with him in San Francisco, Palo Alto to like really transition all the operational stuff. We flew out another kind of a key personnel to be there for that week too. So it was a heavy upfront, on the actual, uh, kind of knowledge transfer. But then he was just available through the rest of the— I think it was the rest of the year, sort of on demand, for lack of a better word. But I also— and maybe this is, I don't know, maybe this is pride, or it could be pride, or it could be insecurity— but I wanted to learn the business as fast as I could so that I didn't need him. And I think, again, like that could be pride or that could be insecurity. I'm not really sure which one it was, but I worked really hard to not need to rely on him for questions. Now, did I? Absolutely. And even a year later when we had some like headwinds in the whole industry, he happened to be in Denver. We met, we talked through things. He was like very generous with his time, even though he didn't need to be. So I think it's not that I didn't use his knowledge down the road, but I just really was focused on that self-sufficiency.

I completely agree. And I think a lot of people need to realize that when they step into this business, like the buck stops with them, not the seller anymore. Like you are responsible for it. And so you almost want to have like your own learning and development plan, like what are the critical pieces of the business that you need to understand so that you can operate it independently? So I think I was— I took a very similar tact and, you know, there was a lot of documentation in the company that I acquired. So I was able to do sort of self-learning with, you know, Q&A sessions with the seller during the first 30 days. And then, um, yeah, so it really had sort of more of like a 30-day transition period, um, which I thought was perfect and that was all that was needed. Another topic on this that we haven't even touched is your customer communications. And I think you and I took wildly different approaches to that as well. So yeah, tell me a little bit about how you went about that.

Yeah, so I think we had communicated with, gosh, and I would say we probably had 10 to 15 15 customers somewhere around there when I came in and we had communicated to all of them by, I would say 2 to 3 weeks in. There were, I kind of, we did the transition, then I flew out to California to work with the seller and, you know, do that knowledge transfer. And then I was there for a week and a half, I think total. And then through that period is when we kind of crafted the messaging for him to send to our clients introducing me. Now, some of those he wanted to handle a little bit more carefully than others, just based on longer, uh, and deeper relationships that he had with the clients. So there were some that we, we kind of staged it a little bit to say, okay, you know, this makes sense to just fire these emails off, but these we want to wait for the next week because there's this event or this conversation that needs to happen, or we want to do it in person, so on and so forth. So, um, we, we did a kind of a slightly different approach per client, but we did have it pretty much done, I think, by 2 to 3 weeks in.

Awesome. And, and so with 12 customers, you basically took like a line-by-line approach, like customer, this is how we're going to do it, customer 2, this is how we're going to do it. Were you setting up like individual transition meetings where like you were introduced on a call or was it an email blast and then call? Like, I mean, give us some nitty-gritty details because I think like for your most important customer, maybe like how was it done?

So most— so all of them received an upfront email that I helped craft with the seller and followed by a meeting. Most important client, i.e., the one paying us the most, um, we definitely spent a couple of calls like learning everything that was going on, how long the engagement had been running, what was working, what was not, right? Digging into all of that. I would say, I don't want to say like for lesser clients, but you know, there were some that were a little bit more engaged on a regular basis than others. We had some that were meeting weekly, biweekly, some we only met every other month with, like it was just kind of an array of different scenarios. So for those that maybe weren't quite as high touch, we did wait until just the next call to bring me in as the, you know, the new person. So it definitely depended, but I would say for those kind of top tier folks, it was send the email, get a call right away. For the other ones, it was like, okay, we've got a little bit of time. We can stagger here to your point about just trying to prioritize everything in the business. Yep. But you handled it differently. You did total opposite.

We did the total opposite.

This is why you operate stealth mode for a while.

Yeah. Which wasn't because we were trying to be like sneaky. It was, we wanted to prove that the business was still running normally and nothing had changed. And, uh, you know, that was, I think what we did pretty successfully. So again, another— in a B2B business, we had about 100 customers. Um, we did our sort of large, you know, announcement. I think it was, uh, like 4 months after the transaction, which it was— I think it was more like 3, which— so what we wanted to do is have some history behind this so that people did not feel like there was a change going on. Um, or let me, let me re-clarify. We wanted them to know that there was a change, but we wanted to show it had no material impact on the performance of the organization. And so we were able to do that. Now, there were some key customers that I was introduced to beforehand, and just given the nature of sort of 100 B2B customers, we announced an email, or we announced a webinar via an email. We invited all of our customers to it and some key partners. And then, uh, the seller, uh, came and joined that and teed it up and introduced me. And so we explained the transition at that point and sort of did it as sort of no big deal because it really wasn't. We sort of made the transition at the beginning and then I led a deep conversation on metrics and performance and like trends that we were seeing. So showed a lot of expertise in what was going on. And, you know, I think we just, we didn't want to make a big deal out of it because we didn't feel like it was a big deal. Like the business was still performing. We were delivering results for our customers. And, you know, a change like this, you know, shouldn't impact the performance and didn't.

Totally different. All right. So like, how do you, how do people determine, right? Like what are the deciding factors?

Exactly.

Yeah, that's my question to you.

I felt like, um, the way that we did it worked really well. I think we probably could have done it a little bit earlier. I mean, I, I have had customers like years later come back to me and be like, why did you never announce this? And I was like, well, you know, we sent out an email, we hosted on a webinar, we sent you all a recording, like, and so I feel like, you know, we operated with integrity around that. And, um, but But maybe we could have done it a little bit sooner, but I think that that probably wouldn't have helped some, you know, in that, that type of situation. So I feel like that was actually a pretty good way to go about it. Um, you know, and it gave me time to get sort of a really good understanding. Uh, like, so I don't, I probably would do it the same way again. Um, although I would have never said that before I had stepped into the business. I think that that was something that was appropriate for this. How about what would have happened if you had waited 3 months?

I mean, it couldn't have happened, right? Because, and I think part of, you know, if you're stepping into a business, you have to look at the business model. Is it a little bit more transactional, uh, type of relationship with your clients or customers, uh, versus more white glove, hands-on, you know, as an agency? We were very engaged with our clients. So we did meet for the most part, we met, uh, at least monthly. Some clients were like biweekly. And so I had to step in immediately just because that handoff—

the seller was still running those meetings.

Basically he was still on a lot of those meetings and the person that was coming in to help run those engagements um, she was new— newer to the organization, organization. So when I got there, she'd only been there for I think like 3 or 4 months maybe. So she was still learning. So it's not like she could have taken over, you know, the, the client calls and just run them without me. It was very much like I had to step in. So I think that, that kind of how do you engage with your clients is probably a determining factor into when you tell them.

Yeah, I think, I mean, that, that makes a lot of sense. The seller of the business I acquired was not involved day to day with client management. Sure, occasionally escalations would come up, but, um, and, you know, I started handling those and I think, you know, we wanted to show that it was no big deal. And I didn't, I didn't, you know, reply to an escalation and say, oh, I'm like, Garth, I'm the new owner. Business as usual. Like, you know, I think one of the things is that I believe, you know, you don't want to— like, my customers shouldn't want to use a vendor where if the ownership structure changes, like, there's a massive disruption to their business. And so, like, I wanted to prove that, you know, we were still going to provide the same great service.

Yeah.

All right, so we both took some wildly different approaches to communicating internally and externally, and, uh, and, you know, I think it both worked. It worked. Do you have? Yeah. Yeah.

I think, I mean, I think so.

Yeah.

So, you know, yeah, I was just gonna say, I think like clients responded well, my team and I got along well and I don't like, you know, aside from a few initial bumps in the road on client expectations, I think everything was pretty, pretty well orchestrated.

So, you know, we took very different approaches. They're different businesses. Does that mean like, ah, don't worry about it too much, it'll all work out? Or I think that the message is more like, do what's appropriate for the business. And we had slightly different business contexts that made each of our choices a bit better. And there's not like a one-size-fits-all playbook.

Yeah, exactly.

Yeah.

Awesome.