Simple Steps to Build a Sellable Business and Create Life-Changing Wealth with Carrie Kerpen
Carrie Kerpen, who sold her company Likable Media for eight figures in 2021, breaks down the Whisper framework for building a sellable business. She covers valuation multiples, recurring revenue, documented systems, and protecting your team through phantom equity before a sale.
Questions this video answers
May 19, 2025
2007
14 years
2021
Approximately 4× to 8× EBITDA (agencies commonly valued in that range)
Chapters
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We don't start businesses because we think we want to sell them. You think about it like I'm doing this because I'm passionate about it. I'm going to go into it and I'm going to be able to do this. It's going to be great. And then oh by the way, if I sell it, it's an afterthought. But the reality is it's a real opportunity to make life changing wealth if you go about it the right way. Even if you're building a lifestyle business, they can take a lifestyle business and turn it into a life changing ass.
Welcome, welcome, welcome back to the Earn your happy podcast. I'm so excited that you're here, you guys. If you are new to the show, thank you so much for joining me. You could literally be anywhere in the world right now and you chose right here. So I hope that you love this episode as much as I do because this one is like exactly where I'm at in my life on what I love to learn about. So. So I'm hoping that you love it just as much as I did. But before we get into the show, I want to remind you that I want to give you a huge ass discount. 25% off of glossy if you don't know what glossy is. Like I said if you're new to me. You guys, it is a beauty hydration company that is skin first gut focused and we're literally changing the game about coming from the inside out from for your skin. Because so much skin care is only topical and so many hydration sticks are just for extreme athletes. We wanted to merge that super easy habit and make it a beauty ritual that you can't live without because your skin is just going to glow way too much and you're going to feel so much less bloated. You're going to feel lighter in your body. I'm telling you, I put everything in here that I wanted in here in order to get to my goals. So I hope that you love it. Go check it out. It's at get glocy G E T G l o c I.com and get 25% off with code happy so today on the podcast I got to sit in person at my house with Carrie Kirpin. She started and scaled and sold Likable Media. It's a woman led digital agency which was named the sixth best place to work in New York City. That's pretty cool. She's the founder and CEO of the Whisper Group as advisory practice teaching women how to build sellable businesses. This is key. So over the course of her career, Carrie has driven over nine figures in revenue for the companies that she's built. And especially as a first time business owner, we don't always start businesses with the end in mind with planning to sell. So I know so many of you have businesses, you guys, that you're not thinking with the end in mind and this is going to change the game for you. Honestly, this episode is fun. Full of so much good news that if you haven't thought about building your business to sell from the beginning, it's not too late. So being able to sell your business isn't only reserved for massive companies and you'll see the benefits of building your business to sell in real time long before selling it. So this episode not only breaks down who and what types of businesses should consider selling, but Carrie also simplifies the how to make it happen. And before you tune me out thinking that this isn't for you, Carrie's also giving sanity saving tips on how to help any business become more profitable and set up for a team of a players to run it smoothly. You guys, she's going to talk about the secret sauce in your business and you can listen in to learn the seven keys to build your business to sell for life changing money. Like I said, I loved this episode. So I hope that you do as much as I do you. Let's get started. Carrie, welcome to the Earn your Happy podcast.
Thank you so much Lori. I'm so excited to be here with you.
It is so much fun to have you here in person. There's nothing like an in person podcast.
Well, the Last time I saw you was in person and you were wearing like a really cool neon outfit and you were on stage and I was like, she is just the baddest there is. Like, I just, I mean, stop. Go on. I'm so happy to be reunited. I just, I'm in awe of you.
Oh, my gosh. Well, you totally rearranged your schedule to be here. You're like on a world tour right now. You guys having a book out is, is no joke. Like, you are on. You're. You're in a marathon right now.
Like.
Well, a massive sprint.
Yes, a massive sprint. It's a sprint and it is just go, go, go for right in this moment. But sometimes we have those moments, right? Sometimes you have like the speed and then the slow.
I think that's so important for people to hear because they see people out on their book tours and like, oh, my God, that's the dream. It's incredible. And let me tell you, my dream did not actually feel good.
I know it's pretty. It's actually pretty grueling. You're. You're right. It's tough. And it's. You also, like, you can feel very exposed too. Cause like, you're, you're just. You're constantly talking about the book. You're constantly like, me, me, me, my book, my book, my book. It's, it's, it's definitely. It feels awkward, but, you know, it's. But what's wonderful about it is getting to be with people like you.
Yeah. Oh, my gosh. Well, this is amazing for me as well.
I love when people have a book.
Like, yeah, I get to sit and like, talk about where they're at too. And, and I know that journey of bringing a book to life is absolutely massive. It changes who you are. It changes you on the other side. But in order for someone to even want a book, it means that they have had a message in their life or a journey that they've been on that is like, this is a huge part of my entire story. Like, and it's so important for women to know. And I know that with your book, the Whisper Way, it's about helping women make life changing money and selling a business so that they can have life changing money and completely, you know, have freedom and build things to sell. And I think that growing up, I did not understand the concept of building something to sell.
That's right.
I didn't even. Even starting businesses. I didn't understand that at all. So why don't we start there of what, what was like the moment where you're like, I have to write this book.
Well, the moment that I had to write this book was after the grueling 14 year journey of building an agency at first together with my husband, and then me taking it across the finish line and just feeling really, really alone in the process and feeling like, just like you said, like, we don't start businesses because we think we want to sell them.
Yeah.
It's like people flip houses, but you don't think about it like flipping businesses. Right. You think about it like, I'm doing this because I'm passionate about it. I'm going to go into it and I'm going to be able to do it. It's going to be great. And then, oh, by the way, if I sell it, it's an afterthought. But the reality is it's a real opportunity to make life changing wealth if you go about it the right way. Even if you're building a lifestyle business. That's the thing. Like I want to, I want, especially for women, I want them to understand that they can take a lifestyle business and turn it into a life changing asset. I love that.
So my biggest question for you then is what types of businesses can actually be built to sell?
Every single business can be built to sell.
Really?
Including personal brands? Yes. Wow.
Because we hear opposite a lot of the time. We hear if your brand is built too much around you, you're not going to be able to sell it.
It's not to say if your brand is built too much around you, you will be worth either significantly less or very little. But that's not to say that if you build a brand around you, but you have systems to support that and you have programs to support that that can be transferable, then it is a highly monetizable asset at exit. So it's not really about, oh, it's you and you're the brand, Lori. It's about what's behind the brand. It's about what people are buying. And are you able to create that in a way that it could be transferable to another person's personal brand? Does that make sense? Yeah, totally. Yeah. So it's like it's really almost any business if you incorporate the. The right pieces can be made into a, a truly sellable asset.
Okay, I think we need to start talking about the right pieces.
I'm ready.
Okay. Do we start with the end in mind?
We always start with the end in mind. But Lori, I don't know if you know that Whisper stands For the seven tenants of building the most highly sellable business. Okay. And it does start with the end, because it always starts with why. So each letter corresponds with one of the pieces needed to build a sellable business. And we start with why. So why do you want to sell it? Is it because you are, are done or dead inside? Is it because you want to sell it for a hundred million dollars? And if you want to sell it for a hundred million dollars, why'd you get to that number? Why'd you pick it? Totally. Like, what? What's the significance? And figuring out and understanding your why is the most important piece as we get into building this. Because once we know why, if we say, okay, I know my number and I know why I want that number to be my number, then we can build against that and we can go to the H, which is how. And how is about really understanding multiples, Understanding how businesses are valued today, how a personal brand is valued versus a coaching business versus a product business like Glosi. You look at any of those things, they're all valued differently. So understanding the multiples and how to work within them is really important. So that's your why and your how.
Just for anyone with multiples. Because I know when I first started, I was like, okay, multiples.
You got it.
What exactly does that mean for everyone? If they were to be like, okay, how do I find out what the multiple of my personal brand is?
Yep. So generally, businesses are valued on a multiple of ebitda. And what's ebitda? It's earnings before interest, taxes, depreciation, and amortization. But don't even think about them. Think about it like you're valued on a multiple of what you earn at the end of the day. So if your business does $3 million and you make $1 million at the end, that's your profit. Yeah. You're going to be worth a multiple of that.
Okay.
The market determines that multiple. So in other words, there's a range for every type of business. I'll give you an example. Let's say you have a consulting agency, you're going to be worth somewhere between four to eight times your earnings. So in that same example, that business is worth between 4 and 8 million dollars. Now, if you are really smart and planning with the end in mind, you will build a business that is worth eight and probably beyond, versus if you're not thinking about this stuff and you don't put the practices in place, you're going to be at the four or way below. Okay, so the idea is to understand your multiples and then work towards getting to the top of the range or even beyond. Because at the end of the day, Lori, the reality is businesses are worth whatever someone will pay for them. Meaning if no one wants your business, your business is worth nothing. If everybody wants your business, the multiples could go out the window.
But how.
How you find multiples is easy. There's a lot of places you can go to. They got acquired dot com. That's a great content site that has all kinds of multiple reports, pitchbook a lot. You can even just literally Google like your type of business, like hair salon multiples. And you can go. It'll come right up for you. All right, next one is income. So all income is not created equal. You could. That same example I gave you, somebody who's doing $3 million of revenue. It's not always the same value, because if it's $3 million from one client and one client goes away. Oh, that's very different than $3 million from lots and lots of different clients.
Interesting.
Yeah. If you strengthen your income and you understand how to diversify your revenue, really important think about how to, like, de. Risk everything. Everything in selling a business is like, how do I make sure that someone buying this feels like they're buying something that they can carry on?
Yeah.
And if you build your income that way, it's really the best way to do it. I like to say you keep your income red, recurring, expected, and diversified, meaning we can forecast it with ease. We know that clients or products repeat sales. And we know that we have more than one way to make money. Whether it's something like if you're selling at more than one retailer or you have, you know, lots of different products that you offer.
That's so interesting because I've heard of a few companies.
Yeah.
That, you know, they were huge. They were doing so incredible. Like, one of them comes to mind and. And they were in Starbucks, and that was where a lot of their business came from. And it shut off.
Yep.
And it just made them kind of.
Diversification is so, so, so important.
So you could be having a huge income come in. That could look amazing. You could be really excited, but you.
Could think you're the bomb. Yeah. It doesn't matter if. If it's one retailer or one client or, you know, or one product. And then all of a sudden, AI comes in and wipes that product. Oh, my gosh. Yeah. You have to diversify. And the thing is, there's so many ways to do it. For every Business. There are so, so many ways to do it, but it's important to look at. So you've got your why, your how, your income. Okay then we've got your secret sauce. That's what makes you different. That's what, that's the thing. Like if you can build a moat, if you can build something that really truly makes you different, that's what like sort of throws the multiples completely out of the window. And the problem with the secret sauce is we all like to say we're different, we're different because we're different. Cause we're the best, we're different. But like really looking at how can you quantify that secret sauce if you can think about. So like one example, when we had our agency, we used to survey our customers. So our brand promise was we were a social media agency. We were one of the first, we started in 2007 and, and one of the what we determined was our, our secret sauce was that we offered faster service. Cause you had to be fast in social media from the smartest in social. Cuz we didn't do anything but social media with likability guaranteed because that was our name. And so we surveyed our. No pressure, no pressure. You have to always be likable. So we, we surveyed our clients every six months and we said do you still find us? Are we faster than the other agencies you work with? Are we the people you go to right away when you have a question on like the nuances of social and like do you truly still like working with us? And we would hold ourselves accountable to that to make sure that what we were saying made us different actually wasn't bullshit, if that makes sense.
Totally.
So, so the secret sauce, when you have something that really makes you very special, that's what's going to help really elevate you towards the much higher end of that multiple.
What would you say to someone who's like I don't know what my secret sauce is. Like I know there's something there. My community is like you know, super, super deep. Like yeah, I know these things, I'm doing these masterminds or these events or this is special. But how do I quantify?
So there's a bunch of exercises in the book for this but one of the things that I recommend is, you know, start by asking your customers what they think makes you different. Then take a look at your employees and ask them if you have employees, what do you, why are you here? What is it that, what is it that inspires you, that motivates you, like, start serving. And then this is, like, a little different. I think I look at the competition, and then I look for the white space that they're not in. Like, I look at what they say their secret sauce is, and I'm like, okay, it's anything but that. Like, I'm gonna not be that. I have to be my own angle, and I have to find that white space to really tap into. That will make me totally, totally different. An interesting thing that I did with the next business when I launched the Whisper group, was I built an. An exit readiness advisory practice exclusively for women. So I teach women how to build sellable businesses, and then ultimately I help them sell it. At the time, everybody thought I was crazy for doing that. Just women, you know, do you just work with women? I said, no. Well, I mean, I'll always help you. But primarily, I wanted to build that focus. And then I also wanted to add in women who had exited to help advise these women. That created a moat that nobody else could. Like, nobody else could touch. Because we built that largest community, the largest community of exited female founders. It couldn't be replicated. And so when I found that, I was like, okay, this is the secret sauce for that business. Yeah. Wow. Okay. It was fun.
Okay, what's the next level?
Profit. Okay. Okay, go into profit. You got. We're measured on profit. Revenue is vanity. Profit is sanity. You want to make sure that your profit is where it's at. Then you've got your executive team or your ecosystems, if you're a solopreneur. And then the last piece is really about your roar factor. That is your computer confidence. That is how you're going to sit in a room in due diligence in a room which is almost always filled with men tearing apart your business to shreds. And you have to be able to stand there and take it and fight for the business, because otherwise you will come out earning much less than you thought you were going to earn.
Oh, interesting. Okay. Share more about that so people can understand.
Okay. So when you go to sell your business. Yep, you're ready. You go, you get evaluation. You think you know what you're worth. As I told you before, you're worth really what the market will bear. You go out, you say, okay, I want to sell my business now. You start getting offers. You get an offer that dazzles you. You're like, this is great. This is going to be amazing. You get a letter of intent that said letter that's going to say, oh, you're Worth this much.
Yay. We love you.
We love your business. Okay? You sign it, you get into due diligence. That's when they start to rip apart your books and look at everything that's there and say, this actually isn't what I thought it was. So I'm going to adjust that offer. So what I want and teach women to do is before the loi Go through all the negotiating, go through every piece of the finances, go through everything that you can to present it as clearly as possible and make that loi as detailed as possible to protect you from getting any kind of reduction in your sale value.
How do they. How do they do that before? Like, how do we build?
Yeah.
With that particular portion in mind, how do we start?
So you know that the way that you do that is to know your numbers early and often. Having a really keen understanding of your p. L. Making sure that you understand in your business, like, stuff you run through the business that isn't really used for the business, which everybody. Everybody does. But, you know, you really want to have a clear understanding. You want to have a clear understanding of your customer acquisition costs, of what an acquirer is going to need to. Once they take on that business, what are they going to need to build that business going forward? And I think having those ideas are really, really important. So, like, just really, before you go in, say to yourself, if I were buying this business tomorrow, what would I need to keep it going? If I weren't here, what would I need? I'm handing it over. What would they need to be able to really take it over and make money?
Okay, this makes total sense because you are about to give it away. You're not going to be a part of it.
Yeah.
Are you still going to have a business? Is it still going to be great for them being able to pitch how it's going to be great for them?
And if the answer is no, you're probably not ready to sell.
Right.
That's the whole point. It's like, I want you to think about your business as like, okay, I'm going to hand this over to somebody eventually. Are they going to be able to make money from it? And the reality is, is that when you're doing those things, you're making more money. You're having better systems. You're figuring out the way that you can actually extract yourself a little bit from the business. And now it's worth a heck of a lot more anyway. So you're making more. You're having a better life. And longer term, you're able to sell it.
Yeah. It's funny, I just had a call today with my team and I'm like, as we're adding new things that we have to do, I'm like, we have to make sure we have SOPs for every single thing.
Every single thing.
That's hard when you're small. It is. Because they're already overloaded. My team's already overloaded because as a startup, you start, you know, pretty.
I know.
Pretty scrappy.
I know.
And I'm still in the first year. But at the same time, like you and all the other women who are helping along this journey are in my ear of like, no, you don't want to have to go back and do this. So even though it's a lot of work right now, like, get it done.
Now you need to get it done and then you need to update it as you evolve. Because you're going to evolve so much. Like, that's the whole thing. It's like there's like we, we push sometimes so much to have like everything be perfect, but in reality it's just get it out there, get it written, get it started, and then you'll evolve, you'll evolve. But if you make it a part of the practice very early, you're going to see that that's going to make a huge difference. Huge difference in how you're valued.
Are there, are there practices in your book that you teach people how to get those in place?
Yes.
Great. Oh, yes. Tell me a little about that.
It's really important to be able to have like, I mean, SOPs we talk about all the time. It's like manuals, like if you were hit by a bus, right? It's like, well, how does this business run? How does it operate? What are the tools? What are the best ways to get. You know, it's almost like the. Do you ever have. My mom. My mom is very into this because we had. My dad died when I was younger and my mom was like, I am going to write down for you everything that if something happened to me, here's every password, here's every life. Here's what I want. Here's all of it. You, you basically need that end of life binder, but for your business, you need it for your business. You need all those systems, you need everything that that's there because that's really important. Because otherwise what happens is either you'll sell it and you'll be like on their consulting for a little while and it'll be a hot mess because they don't have what they need. And they'll be. It's just very, very, very unpleasant. Or you leave and it completely falls apart. You don't want that. You don't. It just looks bad. You don't. It looks bad, it feels bad. It's all of it. And a lot of times, you have some money tied up in the back. It's not like you're always getting everything up front.
Yeah. Oh, my gosh. I mean, we definitely learned that now we're getting systems in place, not just in. Taught us so much about business. But Chris's dad had passed.
Yeah.
And he did a lot of. Thankfully, he had a lot of stuff written down. But, man, we just watched the whole family struggle trying to figure things out. And I'm like. To my husband, I'm like, do we have everything? Well, it's written down. I'd be lost without some of the things that you do. And also now in my business, I'm.
Like, no, it's true. Because. Especially because all businesses come to an end. Right. It's just whether it's on your timeline or on a timeline, that's unexpected. Right. There's divorce, death. There's all of those things. Disability. There's a million, like, very depressing reasons that businesses end. But. So you want to be able to chart the course of that business from day one, envision what you want it to be, and then work backwards. Yeah. You know, it's really. It's. If it's very, very powerful. It's something that we did with our business. We built it. We had no, you know, no money in the bank at all. And we were able to, 14 years later, really do very well. We were able to. We sold for eight figures. It was a great exit.
Was.
It was. It was a dream, honestly.
I'm gonna dig deeper into that because I want to know exactly how that all looked.
Yeah.
This is also vital because so many people feel so handcuffed by one person in their business. Like, I know even for me, in the beginning, I'm like, oh, my God, what would I do without this person? And especially personal brands. We can find our people. And we're like, I don't even know how this part of the business operates.
What would I do?
How would I replace this person? And that actually doesn't feel great.
Like, it's.
You need to have those systems in place that someone could come in and be able to take over.
I learned this the hard way through likable. For many years, I was running the agency and and, you know, was very, very people focused. An agency is all about people. They're the product. That's it. So it's the people. The people are the product, and that's it. So I would get these people that I would feel like I could. Could not live without, and then, you know, like, all people, they leave. Something happens. You know, eventually they'd leave, and I'd feel like, oh, my gosh, I can't live without this person. One thing that I really learned from a very young age, I remember I was the top salesperson at Radio Disney. And I looked and I was, you know, I was young and running around and. And selling media. And my husband, when he. Before he was my husband, he worked there, too. And we were competing, competing against each other. It was, like, very. It was, like, fun and adorable and, you know, the whole thing. And we got, like, really big for our britches. You know what I mean? Like, we thought we were the bomb. And one day, our mentor came in and she looked at us dead in the face. Now imagine we are like the top salespeople, and Radio Disney was an unsellable product. You could not hear it. It was before the days of digital. You would turn on the radio in the office with the person you were selling advertising to. Yeah. They couldn't hear it. Like, it was. There was no service. It was an AM radio station. Am. Okay. This is the old days. Okay. She looked at us and she said, I want you to know everyone is replaceable. Okay? So to me, first of all, I felt like there was no way I was replaceable. But one thing was that lesson carried with me so that I remembered every time either I had to make a change or somebody left or I couldn't imagine anything without them. I would remember that voice. And the reality is, you know, we ran that business 14 years. We had a lot of people come and go.
Yeah.
We had good people stay a very long time. But the reality is, everyone was replaceable. Sometimes we would get hit with even. And that's for clients, too.
Totally.
Everything is replaced. Everyone's replaceable. And you just, you know, remember that. Don't make it totally reliant on the people. Build the systems. And everyone is replaceable. Yeah.
And I feel like you enjoy the people more that way, actually, because there's not so much pressure on one person to carry the business.
So much pressure and so much anxiety around. Oh, my gosh, what if they leave? What if, what if, what if? Just let it be like they're in your life. I. I just Remember one time I looked out at my staff, and I was thinking to myself, because they were the best. They were the best. I remember thinking like, these are the good old days. Like, this is. I can't. I can't lock myself into this. I can't freeze it. Yeah. But I can appreciate it. I can appreciate how great they are and know that I can build systems so that when they leave because I don't own them, then eventually I will still have something that is as valuable. Mm. I love that. Okay.
I don't think we've done e yet.
Exec team. That's your team. Well, actually, it's funny. Yeah. So it was your. It's your why, your how, your income, your secret sauce, your profit, your exec team. Okay, so that is really. Or ecosystem if you're a solopreneur.
Yep.
Okay. So your executive team is all about the people who are irreplaceable. It's all about understanding and building systems for them, but taking care of them too. And if you want that person. Like, let's say the person you can't live without.
Yeah.
Like, if you want that person to be with you until the end, it's creating structures and incentives for them to stay with you until the end.
For sure. Oh, my gosh. I. I learned that the hard way, too. Like, if you want an A player, they need to be able to grow. Yeah. And so you need to grow.
They have to grow. I mean, we did a likable. We did a great program with phantom equity. I don't know if you've ever heard of phantom equity. Okay. So there's all kinds of things with equity, and when you raise, we. We bootstrap that business, and we, like, just really clawed our way to the end. And we didn't want to open up a formal equity program because there's. There's tax ramifications for them. It's challenging. Yeah. You have all kinds of stuff with equity, but phantom equity just means if and when we have an event and we sell and you're still here with us, you will get this incentive. Whatever the equity is, it can either be a percentage or anything like that. And so we did have a few people that we had till the end. And then I will tell you that when we did that phantom equity and when we got our check and we gave them money, it was the best feeling in the whole world.
I dream of that.
It's the best feeling in the whole world, because that's all we want at the end of the day. Like, when you think about, like, when I talked about why, it's like for me, my why for making a lot of money was not about things. I was never about things. I was about I need in my life to be able to be generous. It's important to me to be able to help other people. It's important to me to help my team. It's important to me to give back. And I knew that about me. And so for me, like, that was really, really important that I was going to be able to sell that business and give these folks some money that would be like, really meaningful to them. Yeah, that was.
That is like a dream for me.
Yeah.
Like, I literally can't wait.
I know. It's the best feeling. It's the best feeling in the world.
Feels more exciting.
Right. But that's a motivator for you. That's my point.
Point.
Everybody's why is not always the same.
Totally.
And so it's like that's. And I do think that that is uniquely female too. It's like so many of us, like dream of, like, and we care so much when we sell. A lot of times we don't always take the highest offer, the most monetary. We don't take the most monetary beneficial offer. Often we go with who we think will protect our team.
That makes total sense to me.
It's more than just about the money.
Yeah. Because it's trying to continue on and that's what you're going to exactly. Live with.
Exactly.
And there are certain points where you get a certain amount of money and it's. That's life changing enough. You're not necessarily gonna see, like.
Well, don't get, don't get me started on that. I feel so strongly about that. You have no idea. I saw the. The co founder of Loom this piece about how he. They. I don't know, they sold for like $900 million. And he walked away with this, you know, huge sum and he was law. Oh, it was. They had. They raised all this money.
Okay.
So he probably netted $60 million. Okay. And he was feeling lost and somebody on the Internet called, commented like an advisor, like, how sad he only netted 60 million from his business. And I wanted to be like, how sad he only netted 60 million from his business. What planet are you on, you guys? Like, what. What planet are we on that if we think somebody raises funds and sells and makes like maybe not as much as the total value of the business, but makes like it's enough like life changing.
If you're smart with it, especially if you're going to be able to live off of what you just did and whatever that number.
For you. Yeah. For some people that's $10 million. For some people that's even less. Like.
Right.
It depends on your own lifestyle. And that for me is like, you have to put your blinders on with like the, the judgment and, and the fear of like, what's enough? Like really think about for you, what's enough. And I think that's part of how I help founders get to where they want to be.
I love that and something that my. Because my husband just loves numbers. He just like thinks in numbers.
Yep.
One of the most fun things is to talk about even like smaller exits, whatever that looks like. But we've done like, you know, of course, what if you only get 2 million?
Right. 8 million. What if you get 12 million? 6 figure exits? There's 7 figure exits.
Totally. All of them to go. The understanding of like, once you start tapping into bigger money, bigger money makes more money money.
That's right.
And so it's like the understanding of the place where you're like, no, you could actually just live off of what that money makes. Not necessarily at the really small amounts, but like, you can start really making some good money.
You totally can. You can totally. Or you can decide. The other thing is sometimes we feel like almost jailed by our businesses. Like, you feel so stuck in them and like sometimes it's better to just say, okay, I'm going to take this smaller exit now. I don't, I don't need to sell for eight figures, I'll sell for seven. Okay. And then I'm going to take that money and I'm going to invest. I'm going to take some of it, I'm going to put it away, make sure I'm safe, and I'm going to take some of it and I'm going to invest it in something else that I'm really passionate about. Yeah. Because sometimes you feel like dead inside with your business. You know, that's when I sold, when I sold likable. I sold because I knew with an agency you're going to have an earn out, so you're going to have to work for the acquirer for a little while. So I felt down and like not that excited about the business anymore, but not dead inside because I felt like if I were going to, if I sold when I was dead inside and I went to an acquirer, I'd have nothing to give them. Hmm. And if instead I sold the business When I maybe, like, knew I was getting ready to be done, but I wasn't totally done. I could still be really valuable to them and I would still hit my metrics. And that's it. With that timing in terms of, like, you can't really, totally time and exit in terms of the market, but you can time and exit in terms of your own bandwidth and your own ability to, like, really feel good about it.
So, like, you mean time it, like, really be like, okay, I should start looking. I should start looking before time.
Start looking before you're miserable. Yeah. Nobody likes a tired, sad founder. Nobody wants. Why do they. Why do they want to buy that business? If you're tired and sad, why do they want to inherit something that makes them tired and sad?
Totally.
They want to inherit potential. They want to buy something where you're feeling good and you're like, okay, I see where this can go. And so I had enough in me to be like, you know what? I. I think this could be really valuable for you and I'm going to help you get there. And I have enough steam to do it. Yeah. Even though I knew I was passionate about something else, but I, I felt like for me, I was. I was passionate enough to, like, really help them as much as possible, which was good.
Okay, so what's the, the time frame like? Okay, we're starting to. We're starting to feel like maybe we want to sell. What's that time frame look like for selling and how did you know personally? You've kind of hinted around to some things like your business is ready to sell at this point. Yep. What do you have to have in place and what's that time frame?
Okay, so the first thing when we talk about knowing when you want to sell is understanding what your number is and if you're able to get there with where you are today. Okay, so if you say my number is, I'm going to use low numbers now just for. Just in case we have people. So I'm going to say My number is $5 million. I just want to sell business for $5 million. And maybe based on the. How the valuations, your business is worth $1 million. What you're going to want to do is set a plan over a period of time of how to get it to that $5 million valuation. Now, you already know that it's going to be based on the multiples, and you're going to know what you need to earn to get to that multiple. So you're going to be able to do that. Fairly simple math to say, okay, in three years, I think I could get to 5 million by these steps. Okay, so first you're going to have a plan to get you to the space where you want to be. But things don't always go according to plan. Sometimes they go wildly better than plan. Sometimes they really don't go well at all. And so what you want to do is just really evaluate and level set with yourself and check in and see how you're feeling. Now you want to make sure that you're doing that often enough that it you're not. You don't get to a place where you're in the pits of despair. Because if you're in the pits of despair, what I'm going to incur. And I get a lot of founders who call me. I mean, women call me all the time with this stuff. Because we really were not taught any of this, by the way. No, we're not taught any of this.
No, I don't know any.
None of this.
Before I started business. And you know what? I had to go to dinner with.
A bunch of men I know all the time. That's exactly right. And so my idea with the whisper group was to create a bunch of women that are there that I know. I know. Everyone always says, everyone who sells their business is like, how did I not. How did you not exist then? But it's like, really, you want to make sure that you're checking in with yourself on that process and like, how you can go, how, how well you can do. But if a founder, this is what I was saying, if a founder comes to me and is like dead inside and done, I'm going to tell them just instead of going to sell, if they can take a pause, try and regenerate, give it one last go, like, get inspired, see if we can get you there, and then let's get you to exit. Otherwise, you can sell. If you're a tire founder can sell, you're just going to sell for a lot less. And I just, I don't want that for you. I don't want that. I don't want that for any women. Like today. First of all, the stats are nuts. I will just tell you honestly, Lori, fewer than. It's less than 1% of businesses that are sold are female founded. Wow. And when they do sell, they're capturing like 1% of exit value. Wow. It's really hard. And a lot of it is because we don't know this. We don't know. We don't know it's Possible. You have a. You have an interior design firm. Okay, I'm done. I'm just gonna close it. They all close it. And there's just such an opportunity. You. You could sell an interior design firm. You could sell a coaching practice.
You.
You can sell all of it. We just don't know, because unless you're exposed to that room full of men that has done it before, you're not getting that education. And so for me, that's my real vision for what I want to see for women. I want to create a way that they can get educated about this stuff, that they don't have to feel afraid of it. So many of us feel, like, afraid of numbers, or we say, like, oh, my accountant, my husband, whoever, just does that part. But the reality is it doesn't have to be scary. And it's a really good opportunity for women to get more money, which gets us just really, at the end of the day, more freedom.
I'm so glad you have such an approachable way about you, in such approachable vibe. Like, you. You literally need to be everywhere. Like, this is so truly. It's so vital because I have been searching for you for a while. Truly, I have. Because even some of the women in this. And I'll be totally honest, I know.
They'Re intimidating, as I know.
Like, they make me feel like I can't talk to them or I should know everything. And I'm like, this doesn't feel. I come from a very different industry.
Where we share everything. Yes.
And I was like, this doesn't feel feel friendly.
Yes.
It feels scary.
Well, because I think the reality is there's finance and financials. Right. Which is a tough. I mean, those are. It's just. It's just numbers. Right?
Right.
It's. There's. There's no. No warmth in the numbers. Right. But there's warmth in the journey, the experience, the process. Most people, 80% of their net worth is tied up in their business. I'm talking to somebody, potentially, who 80% of their net worth is sitting across from me, and they're nervous and freaking out. So you have to be able to be approachable. You have to be able to understand them, and you have to be able to stand in their shoes. And that's why, for me, I wanted our advisors all to be women who have sold businesses. That was essential for me. That was. That was like a. A must do.
So how do we know, okay, we have a business? We're like, okay, I feel like I might be building to sell. This sounds Good.
Yep.
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People who are willing to sell your business anywhere. From an investment banker who is very big and fancy, a broker who sells your business out of the trunk of their car. Like there's like it could be anybody. There's, there's lots and lots of people who sell businesses you want to look for when you're looking for somebody to help you. Yeah, I think there are really three areas. The first is you want to make sure that they've done deals like yours before. You Want industry expertise, I think, you know, and that's not. Everybody says that. There's a lot of people who say, oh, we service all businesses, we work with all businesses. For me, I want to know that, you know, my space totally. It's really important. The second thing is I want to make sure that your fee structure is something that works for a business of my size. So one thing that I remember was when I was getting approached a lot in the beginning, so we were a social media agency. We were fast growing and like, it was really, it was exciting. And so investment bankers were all over us because at the time there were no social media agencies. They were like, you guys, okay, it was 2007. Like, nope, there was no social media anything. So it was like we were ahead of the curve. And so I remember they used to come to me and be like, okay, come back to me when you're 20 million in revenue. Come back to me when you're 20 million in revenue and you're 5 million in EBITDA. Well, I certainly felt small. I wasn't even at 10 million in revenue yet.
Okay.
And so people like that who make you feel small, exactly what we talked about before, like you talking something, you're like, no, like that. For me, it's about making sure that they do deals in your size and the fee structures. Right. So an investment banker is going to be, you know, minimum between a half a million to a million to touch you, but that they will often, if they can find a strategic positioning, what they'll tell you is they'll be able to get you millions more. So you really, really have to trust that investment banker to be able to.
Do they get paid when it sells.
Or do you have paid on an investment bank? A lot of it is paid when it sells, but there's a large retainer, large investment upfront. A broker out of the trunk of the car is only charging you on contingency. Okay, so that's like a cheapie. But then there's the middle. There's an M and a advisor and they'll charge you something during the process and then they charge you mostly at the end.
So what you do is you help people like you help people sell. So you get a fee.
Yes, yes.
So you'll take businesses you believe in.
Because you obviously want to get 100%. So you take businesses you believe in. But most of what my work is focused on actually before you exit, it's when you want to get exit ready. You want me to help you say like, okay, you're worth exactly what we talked about with the ebitda. Yeah. I do evaluation and say, okay, Lori, your business today is worth X. Your number for your Y. Your. Your. Your Y. Wh. Y is Y. I need to get you there. So what's the path to get you there, and what's the timeline and what's realistic within your valuation range, and what do we need to do to get there? So I help you craft a roadmap, and then I hang around and, like, later in life, if you want help selling, I help you sell. But, like, I invest very early.
I'm trying to figure out who you like, what you do with that roadmap. Are you marketing? Are you street? Like, what are. What's the ways that you create that roadmap?
It's all of the areas of whisper. So I say, okay, your income. Here's how we diversify your income. Here's how we make sure. Okay, your secret sauce. Here's what we need to do there. So it's all of the angles of that. Ultimately, it comes from the client. It's because we learn about their business. We're more consultative. Okay. We don't execute it. We just really give.
Okay, you're giving that.
We give you the map to get there and the metrics you need to hit along certain times.
Okay, interesting. And what is R?
R is roar. Okay. R is so it. It's your why, your how, your income, your secret sauce, your profit, your exact team, and your roar factor. And I wanted to build something that felt like it was not girly, but told through a female lens. And for me, that's how I really felt about Whisper. Like, it was, like, serious but mysterious. It was thoughtful, but it was also playful. And it was like, all of those elements together make it feel like. Because this stuff is scary, if you're not a finance person, it feels scary. I wanted to really democratize that process.
And I. You know, for me now, I feel. I feel much more comfortable now. But I will tell you, it is. It's taken me, like, two years to feel comfortable because of the way people. I just think the way that people approach it.
Yeah.
And you have to be willing to say constantly, I don't know what that means.
Yeah. You have to always, please explain this.
To me, or you're gonna ask questions and you're gonna be lost anyway. Hearing someone speak for an hour, and you literally have to continually say, I don't know what that means. I don't know what that means. That was huge for me.
Yeah. Especially I Mean you, you raise funds. Yeah, yeah. I mean, that's like. It's like a whole other. Whole other language. I mean, I remember when I was exiting, they were talking about working capital. And working capital, in its explanation is fairly simple. It's like, what. How much money do you need left in the business to run the business for like a month if no money? Because you're collecting money every month.
Yep.
Money comes in, money goes out. You need a certain amount in there. The way that people talk about working capital and the calculations feels very, very, very confusing. And I remember for me, I was afraid to ask, like, it was towards the end. And like, I. I felt afraid to be like, wait, what we. What is this number actually going to be? And why is it that number? And probably if I had been able to ask more questions or felt less, like, afraid of looking dumb.
Yeah.
I probably would have done a little better there. I mean, so interesting.
So, I mean, because there's phrases too, in business that you guys will learn that mean different things to different people. Some people will. I. I've even heard some people, like, define EBITDA differently.
Oh, yeah.
And then some people.
Oh, there's different terms of ebitda. So you. It could be like ebit or it could be. Right. They. They calculate what. What matters to them. They can calculate totally differently.
And like, working capital, that could pro. Could that be calculated differently? Yes, always the same. Okay.
There's a calculation and. And people determine the net calculation based on a variety of different factors. So, like, you get in this legal document, like, working capital is your accounts receivable, cash in the bank, minus this, minus. And it's a. It's like a form. It's a formula. And the formula can be manipulated.
Oh, my gosh. I always had, like, even down to, like, people asking me different margins. Margins can be like, exclude certain things, including certain things.
Are you talking gross margin? And how do you calculate the margin? And different people do it differently. Totally. And different businesses do it differently. And so the idea is to be able to explain how your business works and how your margin works.
So totally.
If you can explain that, you're in great shape.
Yeah. And go in with that confidence of, like, I know everyone's different. Here's how we.
Yes. Yeah. That's how we're calculating it. Yep.
Yeah, exactly. I love that. Okay, so let's go back to your business.
Okay.
You had likable for how many years?
14.
14 years.
Okay.
Social media agency. Yep. Before social media.
Before social media was this. Have.
Have a. Did this have a multiple on it? Like, or did they have to define what the category was?
No. So no. Well, 14 years later, social media agencies were a big thing, so. Got it. Okay, so I'll tell you, I'll tell you two things on like this. So if you will figure out how to do that. So, like, I'll tell you how Likable started, and then I'll tell you about the multiple and how we got to where we were. Okay, okay. Likable started on my wedding day. Okay? My husband is a larger than life personality. Okay? He wanted everyone he's ever known to come to his wedding. I don't mean like people from high school. I mean like, hello, earn your happy podcast listeners. I'd like you all to watch me marry my bride. Oh, my gosh.
What?
I mean, like, wow, he's a larger than life personality.
Okay.
And I knew there was nowhere we were going to hold such a wedding or afford such a wedding. We were kids, we're babies at the time, and we had to get creative. So we ended up pitching a minor league ballpark. Okay? We said, we're going to call it our field of dreams. We're going to buy our sponsorship for the night. We're going to resell in sponsors. I told you, we were both from Radio Disney. We knew all about selling in sponsors. So we said, okay, we're going to sell in sponsors in between innings. So, like, instead of Pepsi tossing T shirts, 1-800-Flowers is going to toss bridal bouquets, and it's going to be cute and campy and fun and adorable. We're going to raise money for charity. We're going to pitch the media, okay? They were like, you guys are nuts, but try it. So then, of course, I immediately panicked. And then I was like, oh, my God, I'm having a wedding on a baseball field. But we did. We were married in front of 5,000 of our closest friends, family, and baseball fans. And we had this massive press event and raised over $25,000 for the Ms. Society. It was awesome. But because the press event was so successful for those brands, they came to us and said, like, we would bet on you. We had no idea what we were doing. We were not entrepreneurs at all. We just said, okay, maybe we'll start a word of mouth marketing agency. And that was in 2007. And Facebook opened beyond the college market in 2007. And we said, holy cow. Social media is going to be the fastest form of word of mouth. Let's pivot and call ourselves a social media Agency. Wow. So because we did early, we grew really quickly. So you start winning, like Neutrogena and you start winning GE and you start winning all of these clients. We had no idea how to execute. Yeah. We fumbled our way through over and over and over again. But we grew and grew and grew. We built a great culture. We were super happy. Dave left the business about six years later to raise funds and launch a tech startup and to diversify, as we say, in part of our income. And I took the business through to exit and ran it for another seven years. Business was a little different when I took it over than when he and I started it together. Because in 2007, nobody was doing social media. In 2013, everyone and their mother was doing social media. And you could relegate it to, like, your nephew or your intern or anybody. And so I had to get really creative. And I ended up tapping into, really leaning into the. The power of my network and women. I started a podcast called all the Social Ladies and interviewed women at the brand level, and as a result, tripled my network and doubled the business. And then was like, all right, wow, it's time. And at that time, I was an agency, so we were valued really, I think at. Also, we sold. Okay. The other important thing, we sold in 2021. And multiples were nuts in 2021. So multiples change with time.
Yeah.
So if the market's bad, the multiples can shift down. So you have control to some extent over where you fall in your multiple range. So if you're a strong business, you fall to the top. Bad business, buy bottom. But the actual range is determined by the market. In 2021, the market was nuts in a great way. And so I wasn't thinking about that when we sold, but, boy, am I glad I sold only.
Yeah.
Because we were able to get. So we got the top of the multiple. Top of the market. So it was really.
Can you share what you sold for?
It was great. I can only say eight figures. I'm not allowed to share what I sold for, but I can tell you that it was my. I could. It was. I will say, agencies were valued between eight, four to eight times ebitda. And I was on the high end of that range. Nice.
And you bootstrapped that, right?
Bootstrapped. We started with. We started with the $10,000 from the wedding.
That's it.
Wow.
So you.
We self finance it. We own the whole thing. Everything. Yeah, we own the whole thing. And. And we were married and partners, so it was just our house it was, it was a fantastic first company. Exit in. It exceeded our expectations. It was really.
Wow, that's amazing. That's really exciting. You. And were you building that to sell from the beginning or did you not think about it?
So once Dave left. Yeah, Dave was the face of that business. I told you, larger than life. He was a New York Times bestselling author. He was everything okay. And there, there I was like an operator. I was a really good operator. And so once he left, I was like, okay, here's a couple things I know about this business now. One, social media is no longer new. Two, we invested so much in growing, we're not super profitable right now. Three, every leader I saw in the space was loud, extroverted and male. Is none of those things. So this is the Gary Vaynerchuk era. I came up in the exact same time. Totally. Gary is like, everybody loves Gary. How can you not? So it's like, okay, they're all, this is what the world wants. And here I am, just me. And so I decided at that point I did a couple things. So the first thing I did was say, okay, I don't want to tell my own story. I'm too shy. You know, I'm going to tell the stories of others. That's when I started all the Social Ladies podcast. But the other thing that I did was read Built to Sell by John Warlow and set an exit plan to sell. So I set from that point. I became obsessed with Exit very early and I knew that I was going to get to a place I wanted to be able to get to an eight figure exit for me with an agency. I felt like I was never getting to nine and I wasn't going to be at the top end there. But I knew that if I could be valued at eight figures over $10 million, I felt like I would be in a great space. And then I went far beyond that. So that was, it was, it was something that I had set for myself as a personal goal. And I was.
That's incredible as an agency and that's incredible for the time and that's incredible as a woman. That's incredible for all the things.
Thank you.
And that's really thinking way beyond where you were at. Like a first front. That's a front runner. That's insane. There had to be a lot that you had to work through, a lot of fears and a lot of confidence that you had to work up to. What started you wanting to do this for other women?
When I went through the sales process, I Felt insanely alone. Okay, so Dave is now off running the other businesses. They didn't want to talk to him because I was going to stay for the earn out. So it had to be just me as the founder. Okay, okay, so it's me. It's high pressure, it's high stakes, it's intense, it's crazy.
And you had kind of had him at home to talk to before, like, yes, I feel that way with Chris.
I'm like, oh God, yes. Oh, yes. But it was really scary because again, it was a bulk of our net worth together. And yet I could only be the one in the room negotiating.
Oh my gosh, I was so sweating.
I was so alone and so scared. And I found myself saying like, okay, what woman? Oh, also it was very tense on the relationship because of all of that. It was so hard. Dave and I, we like live for each other. We, we're. We are.
But that stuff can.
Kicked our ass. And so I found myself being like, okay, who do I know in this vast network I had built this huge, huge network of women through all the social aids and all that. Who do I know who sold a business?
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