Build Your Business Like You’ll Sell It!

I never understood people who live in a house for 25 years and the floor is peeling up, the plumbing doesn't work, lights hanging from the ceiling, and then, you know, something has happened and you decide you're gonna sell this thing in 2 months and then you spend $40,000 or whatever it is having someone come in and make the thing beautiful. You know what almost always happens to those people? They stand there and like, oh my gosh, this is such a beautiful house. Why would you not have wanted to benefit from that being the same beautiful house the whole time you lived there? Exactly. Makes no sense. You've just made something amazing and beautiful for the next person to enjoy while you lived in a slum. Businesses are the same way. Why would you abuse yourself and make your life hard and unnecessary only to fix the things that are materially wrong with your business and improve it right before you give it to somebody else?

Welcome to the Speakeasy Mastermind Podcast, where the real conversations happen behind closed doors with the boldest entrepreneurs, creators, and growth minds in the game. No fluff, no filters, just the raw strategies, personal stories, and mental models that move the needle. I'm Erik Berman. Now let's get into it. In today's episode, I'm so excited to bring on JB Brown, where you're going to learn a ton about not just M&A world, but a little bit more. We're going to go more granular and talk a lot about exit planning, what that really means, how to think like a buyer, and most importantly, a couple of huge tips and takeaways that everybody needs to be thinking about right now. No matter where you are in your business. And I also love that we get into some incredible backstories and learn things about the importance of family over business. And ultimately, what does an exit really mean? Thanks, man.

Always great to get a little bit of time with you, my friend. And I agree. Yeah, we've, you know, you meet people in business all the time. A lot of us probably have 1,000 people in our contacts list or more. And every now and then you're lucky because you just, you resonate with the human being. And that was the case with us. So appreciate you, buddy.

Yeah, I appreciate you too. I think it was back in, I think it was a Mastermind about maybe 2, 3 years ago, and we tapped you on to be one of our leaders out in the Atlanta chapter. And that was so excited to have you as one of our leadership out there as it's, as our chapter continues to evolve and get great out there and just fun.

Yeah, during these days it's been a blast.

Yeah.

Atlanta is such a vibrant city and it really needed something like that. So we're building an earnest and meeting some awesome people and having a lot of fun.

Yeah. And right before we got on here, you were talking about, I know we're gonna get into some good business stuff, but you were talking about, we were talking about dogs, rescue dogs. You said you just rescued a dog yesterday or what we're talking about today? Yeah, today.

So the backstory is that we've always been a, a dog rescue family. I mean, really since I was a kid, like if we got a dog, it was a rescue dog from a pound or even a dog that we just kind of found like the, the pet delivery system sort of delivered the animal to us and it was just our dog. Well, we had had two rescues and one was an 11-year-old pit bull mix and the other was, and there was a 13-year-old toothless Chihuahua. Both of them came to us in the same way, you know, rescue situation. They'd have, they'd had a rough go their first time around. And we had both of them for years and both passed away in the last 4 months. And so it was really hard. It's hard on my family, my kids because of their ages, you know, they're 13, 9, and 11. They don't really remember life without having a dog in the house. And so, you know, we had no dog. And of course there's the emotion of, The hardest part as a, as a father and as a parent is when you lose the dog or a pet, it hurts you of course, because they're a part of your family. But I think the hardest part is stewarding little hearts through what's possibly their first experience with heartbreak and, and what that feels like and just trying to help them work through those emotions. So we did all that and I, I was very cautious. I wanna make sure that I knew we were gonna get another dog 'cause we're, we're a dog family, but I wanna make sure that you don't do it too soon. You know, grieving takes time. And so we went through it for a few months and did our thing. And then what happened was, so we live in Gwinnett County, Georgia. So, you know, you said Atlanta and I like to claim being from Atlanta, but if you're from here, some people do not want to give me that credit cuz I'm in the suburbs. But we grew up in Gwinnett and Gwinnett, unfortunately this county is one of the highest rate of dumped dogs, especially pit bull breeds. And it's unfortunately they're so constrained with capacity that they do have to euthanize a lot of 'em. And so somebody had posted something on Facebook and there was, there were like 7 dogs that We're gonna be killed today. And we saw this last night. And so of course we're just like, oh my gosh. So I'm looking at my wife and she's looking at me and we're looking at the dogs. And there was this one dog that we're like, you know what, let's, let's go see her. Like, we're, this is the sign. This is God saying, all right, it's time for you to have another dog. And so we went into the shelter this morning and then we brought the dog in and it actually ended a little sadly because the dog, she was sweet. She was a year old, but she had developed a habit. She kind of had ADHD for dogs, but she developed a habit of mouthing. Right? So she would put her mouth on you and she didn't bite, but she puts her pressure there. And it happened like 6 times with the kids. And I was like, I hate this, but as a dad, I can't do that. So the lady was like, I don't think this is the right dog for a young family, but I have another one. And she brings out this other one, same age, little sweet pit bull. This dog comes out, bundle of wiggles, jumps in the middle of my 13-year-old son's lap, licks his face, happiest can be. And you know, it's one of those things, Eric, where All right, well, I guess this is our dog. So they had named her Axel for some reason, a girl dog. We named her Rosie. And my wife just pointed out that we did accidentally named our dog Axl Rose, which is kind of cool. Yeah, she's rolling around the house now exploring. And so yeah, we've got a, you know, a big change in the house with the new dog and the transition. She's already peed in the floor once, but you kind of expect that with a shelter animal. But those of you out there who— so many awesome entrepreneurs that I've gotten to meet and work with. Also love animals. I don't know what it is, but a lot of us do. I think it's maybe their calming presence. That's right. In, in our life. So yeah, it's been fun.

Wow. Well, congrats on Rosie and we're looking forward to watching her grow through the journey here, and I'm sure your kids are gonna love her. And that's right.

Yeah. If you wanna follow Axl Rosie, maybe we'll get her own Instagram page. That seems like the thing to do now.

That's right. Well, cool. Congrats on that. Let's go back in time a little, JB. I mean, you don't just walk into life and say, hey, I'm an M&A guy. Like, you know, like give us a little bit of your backstory, perhaps some of the entrepreneurial lessons along the way.

Yeah, it's a wild story, man. The only way I can describe it is for those of you old enough to have seen this movie, I really sort of Forrest Gump my way through a series of particular events that led me to where I am that in a million years I wouldn't have predicted growing up. You know, growing up, I didn't even know I wanted to be— I grew up without a lot of money in rural Maine. So we live in Atlanta now, but I'm a Maine and have that sort of Yankee work ethic. And everybody I knew growing up was either blue collar, you know, working in a mill, or they, you know, were a carpenter, or they shoveled driveways or plowed, whatever they could do to make a buck. And so I didn't really have grand designs on what my life would be. I had no idea. I was not a good student. Um, ADHD back then in the '80s, that wasn't really a thing that anybody diagnosed.

That's been pretty common amongst all of us, you know, none of us good students, ADHD, black sheep. But yeah, keep going.

Every one of us, I mean, so many folks that I talk to, and you can tell if you have it, like you talk to somebody and you see it right away. And what's interesting is you'll meet somebody who doesn't even know. Like they don't know that the thing that makes them is actually ADHD, right? So I just knew I didn't want to stay in that hometown and I wanted more and I didn't know what that looked like. So I got really lucky in that my family didn't have a lot of money, single mom, but I was a good athlete and I was big. And so what happened was after my sophomore year in high school, I got sort of recruited by this very elite boarding school. Sounds weird, but it happened to go play football. And the reason that it happened was they had this 150-year rivalry with another very old boarding school where they had been playing football for 150 years straight. And this was the, I think the 150th year that was coming up for this game. They hadn't won that rivalry game in like 15 years. And the headmaster of the school that I ended up going to was really tired of it. And 10 years prior, they had instituted this thing where the winner of the game gets this New England Shaker chair with both schools' logos on it. And he really wanted that daggum chair. So what he did was he went out and was like, look, let's maybe not look at financial ability to pay or maybe even academics. Let's go get some kids who are good kids and maybe need a chance, you know, to be exposed to something else. And let's build just a killer football team. So, so it was me as an—

and obviously they know the big recruits are going to the biggest schools. So they're like, you know, 100%.

Yeah. So it was me as an undergraduate. I was a, you know, coming incoming junior. And then there were 7, what they call postgraduates. And I didn't know what that was when I went, but it's, you know, kids who are really good athletes and they had already finished up a traditional high school, but either their grades and/or their ACT, SAT scores were not high enough. Back then there was junior college wasn't really a thing. And so they had to do like a gap year at a boarding school. And so we did, we mowed through everybody. Like we were playing West Point, like their junior varsity team and mowing through them. So we did. And that experience. Being exposed to people whose parents were, you know, titans of industry from different countries and diverse. And it was the first time in my life where the expectations changed in my own head. You know, what was possible changed. You know, fast forward, I go to college, wasn't particularly great at that, was really good at being a president of a fraternity. Oh, hold on.

You said you mowed through, but did you win the chair?

Oh yeah. Oh yeah. We won the chair.

All right. All right.

We definitely won the chair.

I made a cliffhanger there. Okay. You got it.

Yeah. Won the chair. And actually, so that school's mascot were, was the Huskies, the Kent Hill Huskies. Shout out to Kent Hill if anyone's listening. And I was fortunate enough that we had two Huskies that one of the teachers, because teachers all lived there at a boarding school, and so we would run out through the paper and I got to run out with the, you know, with the Huskies. So that was, that was fun. But the Huskies were never like, they wouldn't run a straight line. So I don't know that we looked particularly tough when we were doing that, but that's what we did. So, so yes, we won the chair. I leave, go to college, and because I truly had never met anyone that went to college at that time, and I was the first out of a big family to go to college, and I had this still undiagnosed ADD, Eric, I kind of thought that getting in was the goal, right? Like, I didn't really— I had no real concept. I just— and back then, remember, everybody our age or older is going to remember this. When you wanted to do something different and, quote, make something of yourself at that time, what was everybody saying to us? Everybody was saying you had to go to college, you have to go to college, like, we have no other— you're not going to be anything. Certainly that has changed now, but that's what it was then. And so I was like, all right, well, I'll go to college. First semester, I was a finance major, and I'm going to tie this back in about 3 minutes because given what I do now, what happened was funny. I hated it. Just so boring. It was nothing but, you know, accounting classes and finance, and it was all theory and textbooks, and I hated it with the fiercest of passions. So switched majors because at the same time I was taking a psych class. I remember thinking, oh, this is interesting why people do the things that they do, you know, at its core. So I switched. I was like, I'm going to become a I'll be a music major because at least I can stand being in the classes. So that's what I did. And I had a—

I was going to say, as being a good people person that you are mixed with ADHD, finance does not seem like the way to go. You're like, I like— anyway, yeah. Okay.

See, what's funny, the most valuable thing that I got out of that college experience was meeting my wife, which is a very common story. You know, meeting your spouse is the big thing. And sure enough, we met my freshman year, her junior year. This tells you a lot about us because we're the same age. And she was a junior, I was a freshman. So it tells you a lot about my academic credentials back then. But I just remember the biggest thing that I learned a lot about myself in college was one, I was elected as a fraternity president at the end of my freshman year, which had never happened before. And so I'm like, okay, there may be something here where for whatever reason, people will follow me and follow my lead. So that's interesting. And the other was at the end of my sophomore year, I got kicked out of school. Why? I had a 0.0 GPA for my first semester. That's impressive. You know how hard you have to work to get a zero GPA? Like, you almost have to try. And so they kicked me out. And this is in our family, it's a famous story because the gentleman ended up doing me a huge favor. The Dean of Students, I'm in his office and you're having this formal meeting and they had kicked me out, but you can appeal. So I go in and I had prepared, you know, the whole night before this impassioned speech that I was going to give to let him give me one more chance. Cause the truth is I didn't have anywhere to live.

Yeah.

So I'm like, where am I gonna go? Back in the days, student loans could float you. You had a, you know, dorm, you had a place to go. I'm like, well, I don't even know where I'm gonna live. I gotta stay here until I figure something out. So I go in his office, I give this whole impassioned speech and blah, blah, blah. And he goes, he leans back in his chair and he said, look, you took the time to show up. I'll give you another semester. It really doesn't matter to me because at the end of the day, we both know the only way that you're gonna be able to stay at the end of the year is if your cumulative GPA is above whatever it was and you would have to get a 4.0. Like you'd have to get a 4.0. And he goes, you and I both know that's not possible.

Oh, the challenge is on.

And I just looked at him and I was like, oh, okay, okay, thank you, sir. I just left. That semester I took a full course load and 3 evening courses. It was business law, a finance course, and like advanced sociology, and then the regular ones. Because I took evening courses, there was something interesting that happened that gave you a boost. I got a 4.2. That's faster. And I remember two things about it. One, being young and arrogant and foolish, went into his office with my transcript that I had printed and, you know, dramatically put it on his desk and go— and I had practiced this in the mirror, you know— don't ever bet against me. And here's the beautiful part. This seasoned, kind, generous old man leans back and laughs and he says, bet against you? I was just trying to figure out exactly how to word it to needle you enough to get you to try.

I love it.

There was some way somehow that he had enough experience to look at me in 10 minutes and say, this is a guy that probably can do whatever he wants, but he needs to be challenged and motivated. And he did. And he somehow saw the chip on my shoulder and knew that chip on the shoulder. And then the other thing that's still a point of contention in my beautiful marriage with my amazing wife today is that while that was happening, I'd never bought books before, ever. Never even read them, never even opened them. And I would when I showed up to class, I would get, you know, a C or whatever. That semester I bought the books, opened them, read them, took notes, showed up, took the tests. And I remember my wife, and so it was straight A's. And I remember her getting furious. She was then my fiancée, now my wife, furious because she's like, look, I have a low A average and I work my butt off all the time. You can do this at will. And she wasn't saying that as a compliment. She was saying it as like, buddy, what are you doing? And so those two things were kind of formative. So fast forward, I go into corporate America because you're looking and saying, I'm not the same as everybody.

Like, there's something that I could harness here. I mean, you just 100% switch and you become a leader of fraternity. You flip the switch and you just crushed school without probably putting half the effort as half the, you know, the other kids.

100%. And that was what frustrated her, was she was like, she was almost offended. Not almost. She was like, you can do this at will. My wife does not like waste. Yeah, her idea was you're wasting God-given talent.

Yeah.

And that's not— that's almost unforgivable. So, you know, I took that to heart. And I never knew an entrepreneur, truly. I really— I knew some hustlers, like growing up, a lot of hustlers, side hustles. And we didn't call them side hustles back then, we just called it— Maine has a word called dickering. I don't know if you've ever heard that word before. Yeah, you know, you dicker. So you, you have this, they have that, you want that, they want this, you figure out a way to swap. Maybe you give me a few more of this, they give you that. This is close as anything that I knew. If I had known an entrepreneur and understood what was possible back in '04 when I graduated, I wouldn't have ever gone into corporate America, but I didn't. So I did, went into corporate America and my career took off and I ended up finding myself in a role, started with sales, did well with that. But the way my brain works, and you, you know this, I just naturally look for friction points and 4 or 5 levels deep of what's really happening, whether it's what's happening with the human being or what's happening in the ecosystem or in the enterprise or what we're trying to do. And I can clarify complex things pretty quickly. So they figured that out, that the company I was with at the time, and they really turned me into this made-up role. Like they didn't even have a title for it. And really what I figured out later was I was a fixer. That's what I was, a fixer. And then I kept doing that fixer role in multiple companies. And the last one that, that I was with, it was a company that built gigantic surgical robots, these 10-foot-tall robots with arms that go out 8 feet. And, you know, they wheel the thing over the patient and attach it to trocars, which are little tubes that you put a camera in. They put little holes in and it's minimally invasive surgery done by a robot. The surgeon's 9 feet away, not inside, and he's got his head in a VR headset. And my role was to go to places where they had just spent $50 to $100 million and they were not happy. For whatever reason and figure out what is the reason that they're not happy. What did we mess up? What did they not understand? Where's the breakdown here? Is it, is it people? Is it process? Is it resource? Is it, you know, structure? What is it? So did that. And all that to say what I figured out, Eric, over doing that for, you know, 8 or 9 years is that fixer role is that I'm, I've met some entrepreneurs and I was, I remember thinking like, I think I'm one of them. I'm in this corporate environment, but I think I'm one of them. And I think the thing that makes my brain work and makes these corporate folks love part of me, and that's an important distinction, I'm going to come back to that in a second, is really an entrepreneurial brain set or mindset. And so the ability to find opportunity and to see vision and to then turn whatever it is that you came up with into, you know, a cohesive reality. So the issue was though, now I'm going to go back to The thing that corporate America thinks they like about entrepreneurial people, and this is going to resonate with a lot of folks, the same thing that they love about you, right? Thinking outside the box or even refusal to accept that there is a box, right? Nonlinear thinking, challenging institutional norms and assumptions. That only goes, that's only good for a point, right? And then there comes a point at which they don't like it anymore because you challenge the wrong person's idea. You challenge the wrong ethos and you just generally disrupt and then they start to dislike like that about you.

Now you're entering kind of corporate culture world versus the startup mentality. There's— that's almost like you want that. Yeah, 100%.

100%. And what was interesting is I was seeing it in the institution I was— the organization I was working for. I was also seeing it in massive institutions. I mean, I did massive install and turnaround programs with Mayo Clinic, Cleveland Clinic. I mean, some of the biggest names in the world. And what was fascinating to me is some of these absolute best-in-class world leaders in what they did there was a phrase that I was always looking for, and I almost always heard it eventually when I peeled far enough, which is this: "Well, that's just the way we've always done it." And that was always the thing that I was looking to get to, because usually either they'll say it and they'll say it with a, you know what, maybe we should evaluate how we're doing something and why we're doing it, or it's a defensive obstinance, right? Or they're saying, "No, we're not changing this." This is us back on our heels, refusing to change because it feels uncomfortable and too different and we're not going to do it. Even though you have just shown us in, you know, clear English on a whiteboard why the very thing that we're doing is limiting us from getting the result we've asked for.

Right.

They still can't make that change. So what do I do? What do you do when you get to the point where the strength that folks liked about you is becoming the thing that makes them uncomfortable?

Right.

You're also creating, and I was tracking this, you're creating hundreds of millions of dollars worth of value when you're in a fixer type role for the organizations that you're working with and you're being paid $100,000 and you're noticing like, there's no difference for me if I crush this role or don't, I'm going to be paid the same amount of money. So there's an incentivization problem. And then that final piece at the time for me was that I was supposed to be home, you know, every third week and only traveling 3 days a week. And I reported to the chief medical officer and I remember her saying, Yeah, you're a little bit of a victim of your own success, which, good Lord, don't ever say that to your employees. Don't do that. That's a free tip from JB. Don't tell people that. We just need you too much. And we don't always trust that we can send someone else in to understand some of the soft nuances of what's happening politically with folks. And so I had been gone almost 8 straight weeks. I had a 2.5-year-old son and my wife was pregnant with our second. And I had been gone so much and they knew it and they were like, hey, we're really sorry. We really appreciate what you've done. Take 2 weeks and stay home. Don't go anywhere. Don't count it as vacation. Just stay home. I'm like, oh man, that's awesome. Thank you for letting me do that. I got home on a Thursday night, Friday morning, and I had promised my little guy that we were going to go fishing because he had missed dad. So I'm like, buddy, we're going to go fishing. And I really gassed him up. Like, we're going to get your fishing pole ready. We're ready. Well, I got a call at like 10 o'clock in the morning on Friday and I've been home for 13 hours. It's a San Francisco area code. And I knew exactly what was happening. And I'm so, I'm like, oh my gosh. So it was like the slowest phone pickup you've ever seen. I pick it up and sure enough, it's like, hey, I'm so sorry. I know that we told you we're going to be home, but there's a, you know, Swedish hospital in Seattle has a really significant issue and they're threatening to pull all of our equipment out and we need you to, we really need you to go. There's a town car that's going to pick you up in an hour. Your flight's in 2 hours and you have to be there over the weekend. So at this point, I'm still so Stockholm Syndrome'd in there that I'm like, oh my gosh, I'm mad, but I'm like, I have to do it. So I'm just going into work mode, right? And probably like a lot of folks that are listening, if you're a grinder, you have this default where you can flip a switch and you can just grind and you just get into a curve and you just do what needs to be done. So I'm packing, I'm throwing my stuff back in my suitcase and I'm leaving. And we have in our house, for those listening, not watching, we have a You know, like a 25-foot entryway. And then there's upstairs, a second level, and there's a banister. That's where the second floor is that you can look down. And as I'm opening the door and I have my carry-on, because by the way, when you're traveling, if you need to bring a checked luggage, you're doing it wrong. So I'm bringing my carry-ons and I'm ready and I'm getting ready to walk out. And I, something made me turn around, Eric, and I turned around and looked up and all I see is my 2-and-a-half-year-old son and he's got his little hands on the bars and his face is pressed between the bars and there's this crocodile. Crocodile tear. Oh, he's not saying anything, but there's a crocodile tear running down his face. Yeah, it's still hard to talk about. And I mean, this is 11 years ago now. And in that moment, I had this realization: this company made me a liar. I mean, made me a liar to my son. And then the second— and that was a blame thing, right? And then the second thought immediately, because I'm a radical accountability guy, the second thought was, nope, that is not their fault. That is my fault. Because I allowed that boundary to be crossed for so long that it was no longer difficult for them to do it. So we have 3 steps from my porch to the pavement. I closed the door. I had my carry-on. From when I left the porch to when I hit the pavement, it took me 3 steps to know that was my last 2 weeks at that company. I was done. Yeah. Because I was never, and I had, I was terrified because I had no idea what I was going to do. But I was never going to let my family down again unless it was my fault. I never wanted that to happen. So I started a company. And the company that I started back in, I guess this is 2012 or '13, was an Amazon FBA company.

Okay, well, I gotta pause you there though, because you're leaving me hanging on another good cliffhanger here. I want to hear about the hug you had with your son at that point when you stayed and you're able to hang out with him.

No, I didn't stay. I went.

Oh, you went that? Okay. I didn't catch that part. Okay. I thought you meant you turned around. She ended.

No, no, no. I, I decided in my mind, so I hit that bottom step. I knew the car was gonna pick me up.

Got it. I thought you might have turned around there and gave 2 weeks notice. Okay. So you actually went and fulfilled it knowing that you, okay.

That, well, what's funny, so I'm glad you said that. I gave the 2 weeks notice in the town car on the way to the airport.

Got it.

I called and said, hey, listen, I really appreciate the training. I appreciate everything you've done for me. I appreciate the level of responsibility that you've given me. But here's what happened, and I'm no longer willing to stay. And here's the funny thing, based on what you know of corporate America and corporate culture, keeping in mind that for 6 months I had asked for a raise and was told that there was no budget, what do you think the first thing that she said to me was?

How much, you know, you can't leave, how much do you need, you know, how much to stay?

Like, what if we double your salary? Yeah. And what was interesting was, I think her intent was to show appreciation. It actually offended me more. Because I was like, hang on. So I have to basically hold a, you know, a weapon to your head and almost come unglued to get you to do the right thing in the first place. And, and so that actually ended up— that experience that I had became a really pivotal lesson in the way that I lead people when I started my own. And the size of the businesses that I grew kept growing and growing. And now I get the privilege of, you know, advising folks that run companies, you know, that they might be doing $5 million a year up to the largest being almost a billion. And those principles don't change. So I gave the 2 weeks notice and she could have given me the most beautiful pony in the world that pooped out beer and, you know, peed pretzels and I wasn't going to stay. There was no world in which I was going to stay. So I was done. Now, to answer your question and close the loop, when I came home from that trip, He was so little and he was, he didn't understand it at the time, but I do remember just picking him up and hugging him and he used to just collapse into me when I would get home and I would, and I just remember saying, Daddy's not going to be gone anymore. Like, I'm just not going to be gone. And he goes, Daddy stay? Daddy stay? And I was like, yeah, buddy, Daddy stay. And Daddy stay became almost a subconscious mantra for me in my life. Daddy stay. And so everything that I couch a decision on now, and when I work with people who have families that are, or they're married, I spend an inordinate amount of time for an M&A person. And we'll get back to that in a second. But I spent a lot more time trying to understand the human beings involved and the uniqueness of their family and their situation, because what's right for one person is not for another. And even the term exit, right? So M&A, most people think it's either an acquisition or it's an exit. And that's true. I have a real problem with the standard industry definition of my peers and all of them mean well, but I have a problem with the definition of exit. It's too limited in scope. Exit to me, one possibility is you sell your company. Sure. That doesn't necessarily solve your problem because if your problem is that the way you're running your company is eroding your quality of life or the time that you have with your family or your mental health or your physical health or whatever it is, and that's the reason. That you're looking to exit. Well, well, what if we just solved that problem? Would you still want to sell it? And most of the time the answer is, well, no, but that's not possible. It's sort of like, well, we'll hold my Monster Energy drink and I'll show you how it is possible. Because an exit, it doesn't do me any good to convince you to sell your business that you've put your blood, sweat, tears, and, you know, lived through things that you probably don't say out loud to most people. And you're going to sell that most likely at a value that is less than what you really would like to get, and I'm going to convince you to do that because I'm trying to get a retainer and a commission. It's incongruent. It's incongruent with who I am and what I believe. So to back up, and I'm going to come back to this, but to back up, start the first business. Darn thing grows like crazy. I really had no idea what I was doing, but the good news was at that time it was the Wild West and nobody else did either. So we sort of figured it out together. And I started selling products that other people made with their brands on and on Amazon. And then Here's the pattern that's going to emerge. I find friction, I see it quickly, and I try to think, look, maybe this isn't solvable, but if it was, how would I do it? What would I have had to do in order to solve that problem? It sort of unlocks the no part of my brain and opens up the yes. And so what I figured out was there's like 9 pairs of hands between whoever made this product that I was selling and the customer that gets it. But if I could even reduce half of those hands touching it, then I would make more money and I could probably sell it to the customer for less. I have no idea how to do that. And so I did a bunch of research and figured out that almost everything I was selling at that time was made in China. And so I'm like, what do I do? What do I do? I know what I'll do. I'm just going to go to China. And so, so I did. And I went to China, I went to Shanghai, and I knew that there were some factories that made the thing. And I did all this crazy tracing. Also turns out you need an invitation to go to China, which I learned the hard way, but you know, you figure it out as you go. And then I got someone to sponsor me like at the last second and was able to go. And sure enough, I went to China, went to Shanghai, met with a bunch of factories, built some relationships, took probably 2 years, Eric, to understand their culture business-wise, which is very different than our culture. Grew that company, sold it, figured out that knowing how to sell products digitally physical products on Amazon and other places. That was the skill that I had learned and all the logistics work that you had to figure out in order to get to that point. It didn't really matter what thing I was selling. It was the process that was valuable. So I just kept repeating it. And every time that I would exit one of those companies, I would just think to myself, this is a really cumbersome, disorganized, unpleasant process selling this business. And just kind of made a mental note of what I would do differently. And so when I sold the final one, I didn't know it was the final one, but it was. When I sold that final one, I just took some time and I was having lunch with a friend and he was trying to sell his business. It wasn't an internet business. It was actually a big home services business. And he's, I can tell he's really frustrated. And he'd asked me a couple of times if I would help him. And I was like, I don't know what that means. Like, I'm not a, you know, I thought you had to have these extremely elite Harvard credentials to sell, you know, someone's business or help them. Yeah, right. And I was like, no, no, man, I don't really know. So we're at lunch and I remember he had a Caesar salad and I had a regular one and he's on the phone with his intermediary, his M&A person, and he's just getting more animated and frustrating to the point where the people in the restaurant are starting to look over like, what is happening here? Cause he's just, he's frustrated and he doesn't know how to say what he's frustrated about. And so I'm finally trying to mouth things to him over the salads. Like, hey, ask this, ask if he, did X, Y, and Z, ask him, you know, and he puts his hand over the phone and he goes, would you just help me? And I was like, you know what? Yeah. All right. I'll help you. So he finishes up and I ended up coming on board just as a consultant. I didn't even charge him. I didn't know how to charge. I didn't know what value I was going to bring, but he asked. And so I did it. And darn sure enough, they had done a really poor job of documenting the SOPs in the company. He had done a poor job. And then the folks he was working with didn't catch it and didn't hold him accountable to fixing it. His financials were iffy at best. He had a whole lot of personal things that were running through the business, which is fine if you clearly document it and you can show what they were used for and prove that they were discretionary. So he had all these things going on and he also had some, I want to say about 80% of his business was going through 2 different service lines and he had 12. That's not what you're looking for. So he had all these issues. So I'm like, dude, you need to, you need to pause and you need to take 6 months and address these things. And if you take 6 months and address these things, 2 things are going to happen. One, your profitability and possibly your top line revenue is going to go up. And two, the way that you run this business is going to feel less stressful to you. Guess what? That is also what someone who's going to buy this business wants to see. They don't want to buy your problems, right? They don't want to buy your laying awake nightmares. They want to buy something that they feel confident if they put money into it, it's going to return money back. And I'm not going to end up accidentally locking myself in a prison. Right. And so did it, surprisingly loved it, and then just started word of mouth, having other people reach out. And it started small, you know, generally sub-million-dollar deals. A lot of them were in that Amazon space because I knew a lot of people. Yeah. And then that just kept expanding and the deals kept getting bigger and more complex. And now I'm going to call all the way back to when I said that I dumped out of that first finance class in college. I realized that in running all those businesses, I didn't know it at the time, but I had to teach myself how to be pretty competent with financials. I'd learned how to read P&Ls. I'd learned how to understand what different line items meant, chart of account, balance sheets. I knew all that cash flow projections. I understood those things, but there was a little bit of a gap when you get to certain levels. And so I was like, okay, I actually like this now because it's real, right? I understand what the things mean. It's not this abstract number that means nothing to a product.

You're kind of like more invested in the outcome. It's more fun. It's more of the bigger game versus just, hey, sit and look at spreadsheets as a as an accountant.

I had accidentally gamified it. Yeah, I do. I view business as a game. It's a high-stakes game, but it's a game. I also, I play poker. I get a similar rush from helping someone to significantly increase the value of the business and either keep it because now it's better, makes more money, and I like doing it, so I don't need to sell it. Or let's, if we're going to sell it, let's both maximize the value of the asset, but also let's prepare you and your family for what's about to happen. Because most people don't know. And let's make sure you're emotionally ready. Let's make sure that you have some financial benchmarks in place and some prep work laid, because guess what? If I get you the biggest check you've ever seen in your life and you're not prepared and the government takes 40% of it, that's not a great outcome. Didn't have to do that. So, but what I figured out, and this is the beauty about being around all sorts of entrepreneurs all the time, is this is probably 5, 6 years ago. I said, you know, there's some really advanced level analysis of financials that I don't feel I'm 80% there, but I don't feel 100% comfortable. Do I go back to college? Like, what do I do? Yeah, there's a thing called YouTube. Yeah. Now, and I just, you know, popped up YouTube and I knew what to look for. So I'm looking for, you know, really specific things that I needed to know. And Eric, it took me 2 days.

But you know, you got motivated to learn something. You did it fast and your wife got mad at you again and said, damn it, JB, you figured it out so quickly.

I think it's more just technology catching up. Right. So, so 20 years ago, I would've had to go probably back to college or, or maybe there's a library with all kinds of old books. Now I was able to find exactly what I was looking for and I had a couple little small gaps and I filled them. So amazing. So the, the final end to this story, and then we'll, you know, we'll get into whatever you want, is did that, still do it, still help folks traditionally exit their businesses. But what I've shifted to now, because the final friction point that I found in doing that is It really was bothering me because by the time somebody would call me, they had already made the mental decision that they were ready. They wanted to sell, period, full stop. And whatever happened to lead them to that point was what it was. And, but they're invested. They want this thing gone. The issue there is when I analyze a business, I know exactly within very, very small margins what it's going to sell for in the condition that it's in. You do it enough and it becomes pretty easy. And I would look at it and I would say, oh my gosh, this is the number that's in their head or not, but this is what I know they're going to get for it. And there's a massive gap between what they're going to get and what they actually need to either not work again or to get them a buffer between whatever the next thing they're going to do is. If I had only been able to meet and talk to and work with this person 1, 2, 3 years before this, I would have had time to help them just do some little small things that add up. And it would have been a drastically different situation. But M&A and, you know, brokerage, there's a whole ecosystem of folks that do different things. It's just not designed for that. It's very transactional in nature. So I decided 2 years ago to make myself an expert in exit planning and to really understand what has to happen to create an asset that someone else actually wants to buy. And pay a premium price for. And so now 70% of what I do is actually, you know, exit planning and consulting for increasing the value of the enterprise and making it more pleasant and seamless to run and also preparing the owner via some unbelievable partners that I have for, you know, let's make sure that you have a great trust structure set up. Let's make sure that we've completely optimized your ability to receive funds and not just get crushed in taxes. Let's make sure that you have an investment strategy. Let's make sure make sure that, you know, you don't, 3 months after you exit your business, find yourself in the deepest depression of your life and not know why, right? So those are the things that, you know, I spend a lot of time on. That's sort of the, you know, the whole genesis of what happened.

Amazing, amazing. Thank you for sharing all that. Wow, so many little, little learns through that. I mean, some questions I have, and I think it's so interesting, you help me understand exit planning. You hear the word exit planning and I don't quite understand on exactly what that means, but I think this is a good under— you know, more of, you know, I hear exit planning, it's more like almost later down the path, like, okay, you sold. Yeah. Let's plan for your exit now that you're selling. And I think you've reframed it for me, which is helpful. And I think for us entrepreneurs and business leaders, a majority of us, from me talking to a lot of entrepreneurs, unfortunately aren't the best planners. They're not like, they do things last minute that, you know, procrastinate is natural for us and that's just the way things are. So how do you combat like, because the reality of what you're saying is so true. Like, if I only knew that I plan on getting out 2, 3 years from now, gee, these are the things I would have done. And so I see that huge opportunity to be working somebody like you or others to be thinking ahead. But I think too many people just aren't accustomed to that. So what can you say, or how can you get us to all maybe— how can you just bang a stick against all of us right now to be thinking more in terms of it's going to make such a difference? And what's that feeling we have maybe to say that's the feeling you're having in your gut to say maybe you need to start thinking about that.

Yeah. And that's actually really easy because I just think of, I'm as hardheaded as anybody and I think of me, those, especially those first two businesses that I started, I'm the avatar that we're talking about here where it was like exit. I'm not thinking about exit. I'm thinking about day to day. I'm thinking about blah, blah, blah. And you really, you're a firefighter at that point. You're reacting to whatever is going on. Here's the truth. True. Intentional, focused exit planning is just good business. It's just good business. Because think about this for a second. If you took everything that was true about your business, you know, you took the financials, you took, you know, how much revenue you're bringing in, how much profit is spit out, what you had to do to achieve it, all the things that you had to beat, all the people and all the landings you have to stick, and the amount of time it takes you to do it, and you wrote that on a piece of paper, okay? And you stick that piece of paper in a drawer and you walk away for 2 days. And then you come back to that drawer and you divorce yourself ego-wise from being the person who wrote it, and you just pull it out and you ask yourself the simplest question. I'm going to read through this. At the end of it, I'm going to ask myself, would I buy this company? And if the answer to that is no, which it almost never is when you do the exercise, you got work to do. Because if you wouldn't buy it, why in the world would somebody else? So you have to think like a buyer. And the darndest thing is a business that's extremely attractive for you know, an institutional buyer, a strategic, a family office, whoever that is, guess what? It's also a business that's probably a whole lot more fun to run. So it's like, why would you wait until the very end? There's a really close analogy to homeownership here, and it's not direct, but it's close enough. I never understood people who live in a house for 25 years and you've got the floors peeling up, the plumbing doesn't work, lights hanging from the ceiling, you know, all sorts of issues with the house. And then 2 months before, you know, something has happened and you decide you're gonna sell this thing in 2 months, and then you spend $40,000 or whatever it is, having someone come in and make the thing beautiful. And you know what almost always happens to those people? They stand there and like, oh my gosh, this is such a beautiful house. Why would you not have wanted to benefit from that being the same beautiful house the whole time you lived there? Exactly. Makes no sense. You've just made something amazing and beautiful for the next person to enjoy while you lived in a slum. Businesses are the same way. Why would you abuse yourself, which is in some ways what we're doing, and make your life hard and unnecessary only to fix the things that are materially wrong with your business and improve it right before you give it to somebody else? Would you want to enjoy that?

That's a great analogy. So true. So let's jump into like, what would be some simple low-hanging fruit ideas people could do now? Because again, it's always, you know, people are typically in most cases live in the quadrant 1 of Covey's, you know, what I think it was Covey, right? The urgent but not necessarily important. And you're talking about quadrant 2 here, right? This is important and not urgent necessarily stuff that I need to be doing for my future exit when I don't feel like I need to exit today. But what are some simple things we should be making urgent that we're not?

Yeah. Big ones are very simply, I believe that every business owner at any time should always know the exact value of their business. To a third-party real-world scenario. And the reason for that is you have to have some sort of objective quantitative benchmark to start from. You have to, because otherwise you're just guessing. And there has to be a scorecard, especially for entrepreneurs, because almost all of us, even if we weren't former athletes, we are scorecard, scoreboard driven. We want to see a metric, beat the metric. That's how our brains are wired. We want to go further comfort-wise than most human beings are willing to go. That's an entrepreneur. But most of us, And so if you know what your business is worth at any given time, and probably annually is enough, if just once a year you just get a business valuation done, it's going to tell you some things that will answer a lot of those questions. The biggest one is whatever industry that I'm in, what is the profit margin, the average profit margin of best-in-class company in my industry? What is mine? There's going to be a gap between those two things more than likely. Maybe you're one of the amazing ones and you find out, gosh, we're 3% higher than anybody else. We're doing really well there. We need to keep doing more of whatever it is that we're doing that led us to be able to have that end result. Most of the time it's industry average net profit is 15%. We're at 6. Well, that's not good. Why are we at 6? What are they doing that we're not doing? What do we need to change? Another that you will find from that same valuation is multiple gaps, right? So the multiple that is paid for a business that does X percentage of profit and revenue is very different from the exact same business in the exact same industry that has more top-line revenue and higher profit, right? Obviously. But there's bands to it. And this is where it gets quirky. $5 to maybe $7 million these days, million-dollar business or below. In most industries, unless you're software or healthcare, you're looking 2.5 to 5 times maximum multiple of EBITDA, which not to be fancy, you can just think of EBITDA as what's left, right? What's left after you pay everything. And at that size, often they'll just call it owner's discretionary or earnings. So you take that number, you multiply it by, let's say, an average of 4, multiply that by 4, that's what your business is worth. Something interesting happens though when you get above $7 million, and especially if you can get above $10 million, the exact same business with the exact same profit margins will start to trade for anywhere from $5 to $8 million in some industries. Nothing else changed. So what changed? What changed was who's interested in buying it. You enter yourself into a different pool of buyers because institutional buyers are not particularly interested generally in anything, especially below $5 million. They don't care. So you need to know objectively where you stand in relation to the peers you have in your industry. What are you doing worse, the same, or better than anybody else? Once you know that, you start to identify gaps and you can just start to fill them. So some of the gaps, I have 10 that I measure and I'm not going to go through them all today. Well, but I can do it with you, Eric, is I can give you a link to a 12-minute video that people can access and they can watch the whole thing if they want to. But some of the important gaps that you have to be able to objectively measure, there's that revenue gap is obvious, right? So an industry doing what I'm doing to the market that I'm doing it, what should my revenue be? There's a profitability gap, right? So what do I keep on all that revenue and what is the best-in-class company Another really important one is talent. Talent is a sneaky, sneaky, sneaky important, maybe now more than ever. And this is, this sounds paradoxical because everyone's talking about AI and I'm huge in AI. I'm a big fan. You know, I just went to, you and I were together in Austin at our annual national meeting and Mike Filsaime was kind enough and some other folks to share some really cool things about AI and I was all about it. I loved seeing it. I loved, you know, understanding what's possible. Do not lose sight of the fact that best-in-class companies in almost every industry are still world-class at attracting and retaining and keeping human talent. So if you're not good at that and your churn rate of your employees is X percent and your top competitor is much lower than you, you're getting your lunch eaten and you got to figure out why and you got to figure out what you need to change in your business so that people want to come work with you and they want to stay. You know, maybe it's compensation. Probably not. It's probably culture, right? And so you may have a culture issue, right? So that's the talent gap. And then the final one that I'll mention here— and again, you can go look at all of them if you'd like to— but this one is one that very few people think about, and this is the wealth gap. And I alluded to it earlier, right? So if you know that your lifestyle costs whatever it does, and you need to know— that's, you know, you asked me earlier about simple things you have to know, not in fantasy world, in the real world. What does your lifestyle cost? Look at it. No shame. Don't shame yourself. Look at your bank statements. Look at your credit card statements. What do you spend, right? When you know that, it becomes easier to annualize it. And then when you annualize it, you can then look and see, all right, if I'm spending $250,000 a year, just to throw a number out there, and my business currently covers that and maybe it spits out $500,000 a year. The issue is my business is only worth $1.5 million.

Right.

Well, we now know that you, we're not going to include taxes at the moment because that's an issue, but just for simple math's sake, if you sell your business, you've given yourself 6 years worth of your current burn rate. You're not retiring. Correct. Unless you're 87, you're not retiring. So the wealth gap is simply the difference between between the total net worth that you have of liquid available capital and what you need to accomplish your personal and financial and family goals for however long you need to. You have to know that number, right? The business goes into it. Some people say include your house. I'm not a big fan of that. I think you take the house out of it. But you know, any other assets you have, certainly if you have retirement accounts, if you have, you know, trading accounts, if you have cryptocurrency, real estate, all that goes in there. You need to know what your net worth is, how much liquidity you have, and then you need to know what the business is worth. Because usually what you find is that there's a gap between how much you need to just keep living the same life that you have, the same quality of life that you're used to, and what your business is worth in terms of how many years an exit could provide for you.

Right.

And you need to know that. So if there's a $4 million gap between what you need to get by for another X amount of years in what your business's exit will get you. There's no shame in that. It's not a negative that you found that out. It's an opportunity, right? Because now you have it quantified and you know, all right, I have a decision to make. If a best-in-class company would sell for the exact amount that I need, why is my company not worth the same thing as this best-in-class company? And what do I need to fix?

What do I need to get there? Oh, that's brilliant. That's so helpful. And it's stuff that's, like you said, it's block and tackle, fundamental, not overly complicated. Even that last tip, you know, again, and, you know, knowing your number, knowing your spend, sometimes people are afraid of it, afraid to dig in, but you gotta It's so— and people do it. It's crazy.

So few people do.

Yeah, I know. I have my own— I have personally my own bookkeeper and everything else that just does it. Meets once a quarter. Right. Here's your— here's how much money you're winning or losing every quarter. And no, you're right. And I realize in talking to some people I know how few do actually do that and understand what that number is. It's amazing. I think, you know, to kind of summarize, a lot of these sub-things really go back and I circled, you know, know your value to me is really the biggest takeaway I have because everything comes from that. When you know your value, it gets you to focus on, well, what are the KPIs I'm not tracking that I should be tracking? In order to get the value, I got to get all these metrics in there to help me determine that value, or somebody's going to ask me that data, and if I don't have it, well, that's a good sign that you got a lot of stuff to work on to get to that point, and you need to fix some things. So I know we've gone way over time, and I could probably keep going with you for another couple hours if we didn't have stuff going on and you didn't have a brand new dog to go play with and make sure everything's good with the family, right? So, JB, I I mean, appreciate that so much. Everything you said, you'd say you even have something you'd, you send to anybody that's interested. We'll make it easy. How can people get a hold of you? I know they can go in the Speakeasy Mastermind community. Otherwise, is there anything else we could do? What kinds of things, or when should people know they should come to you? What's a good time when they're doing what?

If you're just thinking my business is either not worth what I think it should be, there's friction here, I'm confused, I don't have clarity on what next steps are, What I can do is clarify very, very quickly what's going on, what needs to happen in order for your business to scale and what you really want. And then from there, the exit decision happens later because again, exit is subjective. It means different things to different people. If you really want to prepare it for maximum value exit, absolutely. That's smack dab in the strike zone. But the thing that I'm the most excited about, and I can tell you what it's called, but I can't yet tell you who it's with, but it's a pretty big announcement. I have decided to just over the years, I've kind of figured out that what I'm really good at is founder psychology, the tactics of how to improve businesses and all the mechanics that need to happen in order to make a business worth as much as it possibly can be and what has to happen to exit it. What I'm not is a tax genius. I know enough to be dangerous. I'm not an elite tax strategist or financial advisor. And so I thought to myself, if I ever find someone who is, it would be really cool to build a joint venture program where we just cover all of that for founders. And I found the guy. He's very well known. He's written a whole bunch of books. You know, most people are going to know who he is, and he's unbelievable, and he's a great person, and he's truly heart-focused on helping folks avoid— not in an illegal way, but to minimize their tax burden and really build wealth in a tax-free way. And so he and I are putting together a comprehensive program where not only are you going to have the ability to maximize the value of their business, whether you want to exit or not, but you'll make it exitable and fun to run, and then you'll be ready to go. You'll also be personally emotionally prepared from a financial perspective to be in great shape afterwards. So stay tuned for that. That's coming. The name of that program is going to be called Untethered Empire. And the reason I called that is because most of us as business owners, we do, we feel tethered, imprisoned by the thing that we built. We built it around ourselves and we're tethered to it. And so cutting that tether so that you have optionality in your life so that you can either keep it and run it and have other folks mostly do the things that you don't want to do and it's still doing really well and serving people, or you want to exit it. So Untethered Empire. But for now, I'm on Facebook. I'm in Speakeasy Mastermind. I'm on Instagram. Yeah, all it— and it's really simple. The best way to reach out to me is to shoot me a DM, and I'm pretty responsive and very low-key. So if I can help you, I will. If I can't, I'll tell you.

Great. I know you, and I know you're always so kind-hearted like that, which is why we love and appreciate you, JB. Thank you so much for spending some time with us today. We really appreciate you sharing some great gold and a Great story, and I look forward to our continued journey together.

Awesome, my friend. Always great to spend some time with you.

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