The Boardroom Buzz: Grow, Sell, or Exit

From mixologist to MBA to management trainee, Kyle Varona traveled a road less taken into his family's pest control business. Instead of graduating into Fahey! Pest & Lawn Solutions, it was Truly Nolen - the business - that launched Kyle into his post-college career. It was Truly Nolen - the (legend) person - that inspired Kyle along the way. Customer reviews do a lot more than make a phone ring. Listen for added benefits of 2400+ Google reviews. Kyle also extracts success with a simplified service footprint and offering. Diving into this interview, you’ll hear how Associated Pest finds a common origin with Fahey.  When it was time for David & Terry Pomfret (aka Dad & Mom) to practice retirement, Kyle found himself at the helm. His entrapped experience in New Mexico made taking over a breeze. Fast forward to 2020, and hear how Kyle realized his destiny. With valuations at an all-time high, Fahey found itself selling to Turner Pest Control instead of selling to the next generation. Register for Potomac's upcoming M&A Supernova event to hear more about valuations and the consolidation boom. Co-Produced, Edited, and Mixed by Dylan Seals of hdaudiopost.com

Peter Schiff joins Paul for lunch at Dorado Beach to chat about currency, asset prices, and what is coming down the pipeline for America's economy. Peter is a successful investor, author, and host of The Peter Schiff Show. Before stepping into this interview, you'll hear Peter's 2006 CNBC's Kudlow & Company clip in which he predicts the economic downturn.  Of all days to visit, Paul and Peter find themselves immersed in their conversation during a crypto bloodbath. Peter shares that the world of cryptocurrency is built on speculation and margin debt. With blood in the water, is this the tipping point for politicians to get involved? Will this interference lead to laws to protect people from the free market, or find itself as another means to punish capitalism? Peter does not like any of the thousands of alt-coins, but it sounds like crypto is less likely to be manipulated than traditional fiat currency. Peter has long been known for his love of gold. It's interesting to hear his argument for a national currency that marries block chain with his shiny gold standard.  Peter and Paul make time to discuss inflated asset prices. The Feds believe that the wealth effect creates economic growth. Does it? Peter preaches that entrepreneurship and capital investment grow an economy. After years of 'monetary heroin', Peter reasons that we should let the free market work. Looking to the future, Peter shares that the dollar is the only limiting factor, and that our future lies in the hands of our creditors. Peter contends that a strong currency leads to competitive advantage, and that sound money is the foundation of any prosperous country. Inflated asset prices affect pest control shareholders. Following the sale of a business, how can owners protect their assets? Peter advises on rearranging assets into international emerging markets. In regards to wealth management, Peter's company as well as BKD are a couple places Paul says to research. Patrick missed the Dorado invite (or The Mex intercepted it). In the post-Peter cafe chat, Patrick asks Paul about alternate scenarios had the Federal Reserve not taken the easy way out. Is it time for economic rehab? Paul shares that during the financial crisis, Peter both made money and defended his thesis. From thesis to application, Paul makes a case for preparation over prediction.  Paul also recommends watching Peter's Mortgage Bankers Speech from November 2006 and Why the Meltdown Should Have Surprised No One from March 2009 For more information on current market conditions and valuations, register for M&A Supernova: Navigating the Late Stages of the Pest Control Consolidation Boom Co-Produced, Edited, and Mixed by Dylan Seals of hdaudiopost.com

Sally sells seashells by the seashore, but Shelley wants to know about selling her pest control company and starting back up in a nearby area. Brands, logos, and restrictive covenants come to mind. What else will Patrick pull out of the mystery grab bag of listener-submitted questions? While Shelley is curious about making an exit, Jesse wants to know about competition. Does The Boardroom Buzz duo have an opinion on competing against a large corporation or several mom & pops?  Tune in for a quick Q&A session on digital marketing, inflation, and the current M&A markets. Paul reinforces that there is a lot more at risk this year with valuations than taxes. To hear more about the M&A market in your region, register for a free event at theboardroombuzz.com/supernova Co-Produced, Edited, and Mixed by Dylan Seals of hdaudiopost.com

The marketing game is rigged. What would happen if advertising utilized a President-producing marketing machine? Phillip Stutts introduces his Undefeated Marketing System in this game-changing interview. There isn't enough room for our guest's resumé. Phillip has worked on eight presidential campaigns. Here are a few previous clients: Pres. George W. Bush, Sen. Bob Dole, Gov. Bobby Jindal, Sen. John Thune, and Gov. Ron DeSantis. And it turns out that Phillip and Paul share a mutual client. In politics, understanding the voter comes before spending money. The same idea is true for advertising. Phillip's screen-agnostic full-service marketing firm follows a five step process gleaned from the political arena. Skip a step. Skip success.  The Boardroom has been home to a few digital marketing discussions. Jeff Phillips, Tracy Judnich, and Darin Huffaker to name a few. The odds were stacked against (now) Gov. DeSantis. Phillip innovated. Phillip led the largest geo-farming (yes, *geo-farming*) campaign in the history of advertising, and in doing so led voters across party lines. Most business owners talk about their business and how good it is. Guess what. Your customers don't give two shakes. If you knew your customers' most important values, wouldn't that be useful? Your potential customer will see 10,000 ads today. It turns out that competition extends beyond other pest control companies. There is a secret weapon in the pest control industry. By using customer data, you can get an advantage over your competition every time.  Hear about a pest control company that lost money by advertising discounts. Perception is reality. Cheap and safety do not go hand in hand. Stutts' Win BIG Media team increased the client's top and bottom line with a 'smarter' campaign. Don't let looks fool you. Facebook, Coca-Cola, and Google don't sell soft drinks or search engines. Then what do they sell? Owning data is not under-emphasized in this interview. Phillip found himself canceled. Hear how he seized the opportunity.  Connect with Phillip and his team: phillipstutts.com/insights Dogs >> Cats ;) Co-Produced, Edited, and Mixed by Dylan Seals of hdaudiopost.com

One year after selling Responsible Pest & Scorpion Services to Certus, Darin Huffaker recalls the glory and not-so-glory days. From California to Arizona to Idaho, Darin and his brother, David Huffaker, made big moves along the way. Darin is quick to share mistakes, and how the siblings journeyed together in this turnaround.  Responsible found top-line growth on the doors, but it trickled all the way down to the bottom line. Add in the mix of recruiting plus ethics, and the brothers had to find another way to grow. Creditors turned down Darin and David left and right. Where could they turn as everyone else turned them away? Would saying no to business be the key to their bottom line success? Hear about the evolution of their brand name, and the impact it had on their marketing. Scorpions were a powerhouse pest for this Phoenix player. Darin shares how it proved difficult to find the best formulation, and how he had to put his mad scientist R&D skills to the test. Who doesn't want to see scorpions die a painful death? A price increase conversation comes back to The Boardroom, but this chat brings in a new angle. Perception is reality. Hear how Darin designed a small business mentality with white-glove service. For his team, technology was really a tool and not just a toy. From customer experience to remote working to online marketing, Responsible set themselves apart. Good luck finding another Blackberry-shot video with more YouTube views. Co-Produced, Edited, and Mixed by Dylan Seals of hdaudiopost.com

Tracy Judnich along with his two business partners, Joe and Jeremiah, led The Bug Guys to a solid (and speedy) exit. Certus has taken over, but looking back, what would Tracy do differently? Paul gives props to Tracy's unique capabilities. You'll be hard pressed to find a denser service map. That mad focus went straight to the bottom-line. Join the conversation as The Rule of 23 goes under the interrogation lamp. What top-line and bottom-line growth did his business have? How does it compare to Mike Rogers', Jim McHale's, and...Patrick's business?   The business had roots on the doors. In fact, he reveals his connection to a previous Buzz guest. The Bug Guys maximized sales at the door, but it wasn't on the doors. Tracy gives details to this specific concept plus other start-up advice. You'll hear his opinion on selling over the phone and experience with bundling sales. The funny thing is that Tracy can't turn off his salesmanship. Who knew explaining employee benefits would turn into a sales presentation? He describes how compensation is more than an hourly rate. Stick around to hear Paul preach on pricing again. Is it ever too little too late for a price increase? Uh oh. Does Paul need to call Bobby? It's 2am. What are you smoking? Co-Produced, Edited, and Mixed by Dylan Seals of hdaudiopost.com

Paul Utts directed RID Pest Control to provide a more than comfortable lifestyle. Now writing the last chapter of his pest control career, he still has some work to do before sailing into the sunset. With this transaction completed, it is time to tell the story of how Paul Utts stumbled into the industry. What ends an era in pest control services for Paul, began as a waiter at a kosher hotel. While he credits this role for learning customer service, would you agree that this time planted the seed for his love of acting?  After college, Paul learned a lot about food safety as a health inspector. Seafood or see food? As a health inspector, did his inspections reveal a kitchen's true character?  There are some technical bits in this Boardroom banter, but tune into the sales opportunities and advice. From inspector to management to an owner, Paul wore many hats in his storied career. "Managing from a P&L is fascinating" may not be the only line that he feeds during this interview. Speaking of management, he shines the light on using bonuses to motivate. Wow-ing your customers can be as simple as answering the phone. Is it too much to ask to get a 'hello' from the other side when you call a service company? Vulnerability comes to mind when it's time for due diligence. Before that scene plays out, acquirers should take a cue to shift their focus to the seller. Which hat did Viking Pest Control wear to the courting conversations?  And for the record, Utts is not his Jewish name.  Co-Produced, Edited, and Mixed by Dylan Seals of hdaudiopost.com

Why not wait until Episode 50 to start at the beginning? The beginning of M&A (mergers and acquisitions) that is. In the miniseries foretold, legal structure sits as the first building block of M&A.  You'll hear about asset purchases and stock purchases. Don't get drowned out in the verbiage. Hear how the role you play in an M&A deal determines your preferences. For previous reference, Tony Sfreddo (Episode 5) built up quite the government contract portfolio. Does that lead itself to designing a deal one way or the other? Are there variations to asset purchase agreements and stock purchase agreements? Maybe there are more than two ways to skin a cat. The arrangement bakes-in tax implications. Is there a work around? Allocating purchase price can favor long-term capital gains over ordinary income rates. Fast forward from the announcement, what will benefits look like with the new owner? Deciding a deal's architecture determines how employees move forward while the ink dries.  Thirsty for more? Go grab a vitaminwater® Co-Produced, Edited, and Mixed by Dylan Seals of hdaudiopost.com

Before you can judge Patrick for his inability to explain Profit First, it's a better idea to ask the author. Mike Michalowicz gets his formal introduction to the pest control industry in this extended interview. Hear how Mike leverages human nature to establish predictable profit. Sales - Expenses = Profit. True, but Mike creates a cash management tool by flipping the traditional GAAP formula. Pre-Profit First, Mike struck it rich in his early 30's. As a new angel investor with a nice ride, Mike hit rock bottom in more ways than one. With raw emotions, he recalls the events that inspired his best seller. Writing became therapeutic as he began his 'journey to eradicate entrepreneurial poverty'.  Revisiting his experience with depression, Mike recommends mental therapy. He even gives a poor man's version to help recover.  Don't sit-back while Mike preaches on plowback pain and pleasure. Is there a better segue than hearing Mike advocating on profitability before selling? Paul counters by asking about ROI. What if your own business is the best vehicle to put capital to highest and best use? Hear how Profit First-adopted companies compare to the control.  Windup the clock. Paul pulls another Michalowicz book, Clockwork, off the shelf for the session's 1st OT.  Swooping in and saving the day as a superhero manager leaves a wake of damage. What can an owner taking a four-week vacation do for the business? Do you find yourself carrying the burden to provide jobs as an entrepreneur? By working in the business, are you taking jobs from your employees? The prolific author is releasing another book this year, Get Different. He gives an example of unique marketing as opposed to getting lost in the sea of industry best practices. Does Dad approve? Paul inquires about Mike's habits to produce these books. Mike goes onto share income generated from writing and distribution breakdown. Mike gives input on mainstream publishers vs self-publishing vs hybrid options. Is that Dad whispering in your ear, or Mike narrating another book for Audible? Dylan joins Paul and Patrick to recap the dynamic interview. The lines get blurred between private life and business life. Paul retells stories of those that have cashed out but hold onto regrets. Dylan opens up about his similar struggle with depression. He shares his success habits and the personal growth he's found through journaling. Dylan explores the subconscious mind, and how he utilized consistent habits as opposed to willpower.  Co-Produced, Edited, and Mixed by Dylan Seals of hdaudiopost.com

It’s time to catch-up with some listener submitted questions. Serial entrepreneur Patrick can’t find a way to dodge the first question about franchising. Six years ago, Patrick and Bobby franchised their business. With properly placed intentions, what advice can Patrick give looking back at the experience? Patrick goes into detail about what he would do differently if he had to make the decision again. While Paul recalls Patrick learning the hard way, Paul gives an alternate entry for staking start-ups. On the flip side, Paul gives advice to those considering the franchise-life. A business in a box sounds efficient, but ask yourself, ‘self, am I buying myself a job or building an asset?’ before becoming captive to the franchisor.  Proposed tax increases have been a catalyst for sellers such as last week's guest, Jeff Phillips. What effect do these tax changes have on acquirers' appetites and the price they're willing to pay? The first quarter of 2021 has been Paul's busiest Q1 in his eighteen years as a pest control sell-side advisor.  While tax speculation anxiety plays out in the US, tax increases are going into effect in Canada and other countries. Drilling down to specific markets, population exporter-California and importer-Texas get extra attention. What does Paul know about the buyers' outlook for this year in these markets?  Scarcity of assets brings up another line of questioning. How can scarcity be quantified and managed? It's not just about size, but also the number of assets in a given market. Patrick caught wind of previous perverse incentives in M&A. That road led to a quick chat on leverage, contingencies, and skid marks.  When it comes time to discuss growth strategies, would it really be an episode without discussing acquisitions? Referencing Pam Blauvelt's experience, Paul has seen where deals have led to distractions and mistakes. As exciting as arbitrage sounds, can it hurt more than help? Stay tuned for upcoming events: 1) a Mike Stanczyk collaboration on shareholder agreements, and 2) measuring and managing customer retention in The Attrition Condition.  Co-Produced, Edited, and Mixed by Dylan Seals of hdaudiopost.com