Intentional Growth

Cindy Eckert (formally Whitehead) is the founder of a Sprout the first pharmaceutical company to develop Addyi, the first female Viagra. In the mid-2010s, Cindy sold her company to a bigger pharmaceutical company but soon found she made a mistake. The program Pinkbator is searching for women entrepreneurs wanting to improve the lives of women and the world in general. Cindy is very passionate about her mission and the company she built. She takes me on the journey of Slate (her first pharmaceutical company), Sprout, and finally The Pink Ceiling, She tells me about her billion dollar exit and how her purchaser disappointed her in the end. Cindy was so disappointed by her company’s “adopted parents” that she sued for the right to take the company back. I ask her how she managed it and she credits creative deal structuring and a great legal team. She won the case and built The Pink Ceiling, a business incubator that is dedicated to empowering, educating, and giving women entrepreneurs a chance to grab capital opportunities. What you will learn: Why Cindy became an entrepreneur Why she gravitated to pharmaceuticals Cindy’s fascination with women’s sexual health and why it is important. The beginning of Slate and how it led to Sprout. How to “Be the Workhorse.” The qualities Cindy looks for in her team. The danger of having the wrong partner and being selective about investors. Why you should be accountable to investors. The benefits of an awesome legal team. The stipulations Cindy included in her sale agreement when she sold Sprout. How those stipulations helped her win the company back in court. The Pink Ceiling and Cindy’s view of the future. Takeaways: You need to know what you are passionate about and what you want your company to be. Then you need to align your passion and vision with your investors, employees, and eventually potential buyers. Maintaining this alignment makes all the difference with whether you will be pleased with a sale or not. Links and Resources: GEXP Collaborative The Pink Ceiling About Cindy: A self-made serial entrepreneur and vocal advocate for women, Cindy Whitehead-Eckert defies convention. In her industry, in her companies, in her outcomes. Her work today in The Pink Ceiling/Pinkubator continues to break barriers by investing in and mentoring other women to get to her same outcomes. She’s on a mission to make women really rich. You cannot miss Cindy. Everything she touches turns to pink. Over a distinguished 24-year career in healthcare, in only the last 10 she has started and sold two businesses for more than $1.5B. First Slate Pharmaceuticals, which redefined long-acting testosterone treatment for men then Sprout Pharmaceuticals which broke through with the first ever FDA-approved drug for low sexual desire in women — dubbed “female Viagra” by the media. After selling the company for $1B in 2015, she successfully fought to get the drug back and launch it on her own terms. Cindy has made waves, and made her own success, creating mission-driven companies that deliver big. Her results have become a widely covered business success story featured in major media outlets. She is most proud of helping others take command. The profoundly positive impact those companies have made in people’s lives is what keeps her coming back for more.

My guest today is a CPA named Vincenzo Villamena. Vincenzo began his financial career in New York and decided to move to South America for a change of pace. He is the founder of Online Taxman and Global Expat Advisors. He specializes in M&A (merger and acquisition) and international tax services. We discuss how moving to lower tax brackets can save you tons of money on the sale of your company. The catch is, you have to jump through the hoops to keep your previous state off your back. Vincenzo shares what some of the benefits of living abroad are for former business owners and why it isn’t an overnight process. We also explore the pros and cons of asset sales and stock sales. If you are a business owner and have considered moving to “greener pastures” after you sell your company, Vincenzo may have a strategy that will work for you. What you will learn: Vincenzo’s life in New York. Why he moved to South America. His specialty in international tax services and international investing. How a long-term plan can improve your tax situation. Depreciation recapture, what is it? What is the 179 Strategy? The changes the new U.S. tax codes have made to the 179. The differences between an asset sale and a stock sale. The main sorting buckets for assets. The things you need to consider when designing a deal structure. Why a “fact pattern” is important when you move from states or countries. The issues that come up with e-commerce deals. When an international move a good idea? The Foreign Earned Income Exclusion. The Puerto Rico strategy. How to reach Vincenzo. Takeaways: I mention an accelerator program with GEXP Collaborative during this episode. Our first event should be in August with more on the way. If you are interested in the accelerator program, then you can reach out to me at ryan@gexpcollaborative.com or LinkedIn. We also have a page on the website with more information. Links and Resources: GEXP Collaborative GEXP Accelerator Program Global Expat Advisors Online Taxman About Vincenzo: Vincenzo Villamena, CPA, is the founder of Global Expat Advisors and Online Taxman, specializing in offshore structuring and US tax for international corporations and individuals. Prior to starting his own firms, Vincenzo served as a partner at 4 Corners Inc., where he advised high net worth individuals in private equity investing and tax matters. Vincenzo worked in audit, tax and valuation during his time with PricewaterhouseCoopers, involved in Fortune 100 audit engagements and M&A transactions, giving him the knowledge to perform analysis in valuation, corporate finance, and technical accounting issues. He has both a Masters of Accounting and Bachelors of Business Administration with distinction from the University of Michigan’s Stephen M Ross School of Business.

Have you ever thought about opening a restaurant? Most entrepreneurs can say yes. However, there are a lot of headaches and unseen layers to the hospitality industry that leads to a high failure rate. My guest is Matty O’Reilly and he has made a career of buying restaurants and revitalizing them. Matty is passionate about helping restaurants survive and decreasing the failure rate we see today.  We discuss some of the reasons why restaurants fail and how Matty has been able to dodge that bullet. He has been buying, managing, and selling restaurants for sixteen years and learned every sector of the restaurant business. He is a smart business owner who really knows his industry inside and out. He is currently pursuing his MBA and has plans to launch a consulting service to entrepreneurs in the hospitality industry. What you will learn: Matty’s background in the restaurant business and ten years in management. Why he chose to the hospitality industry for a career. How banks are contributing to the failure rate of restaurants. Matty’s first experience with his own restaurant and how he made it work. Why it is better to purchase an existing restaurant. Matty’s approach to revitalizing his restaurants. What he looks for in new purchase and how he deals with the sellers. How ego can work against a seller. Why Matty is getting his MBA. The benefits of a reactive business model. How Matty decides if it is time to sell a business. Why he never got into the real estate side of the industry. What Matty is doing now and his plans for the future. Takeaways: Early on in this episode, I make a couple of announcements. One is a book I will release with Jim Carlisle, called Ripcord How to Grow and Exit Your Company, that should be out soon. Also, I mention an accelerator program with GEXP Collaborative. If you are interested in the accelerator program, then you can reach out to me at ryan@gexpcollaborative.com. We also have a page on the website with more information. Links and Resources: GEXP Collaborative GEXP Accelerator Program Matty O’Reilly on LinkedIn About Matty: Matty O’Reilly is an entrepreneur who has been working in the restaurant business for 16+ years. He worked his way up through every role in a restaurant and began buying his own restaurants in 2010. He currently owns Delicata Pizza in St. Paul, Republic in Minneapolis, and Bar Brigade in St. Paul. He was also nominated for the Twin Cities Business Magazine 100 People to Know in 2019. Matty has sold seven restaurants to date and hopes to launch a consulting firm for struggling restaurant owners. He is currently pursuing his MBA and looks forward to a new phase in his career.

My guest today is John Garuti III. John spent the majority of his career in his family’s tile business. For anyone who has worked in a family business John’s story is all too familiar. He tells about his family dynamic during those years and why he finally asked his father to sale the company instead of taking it over himself. The sale process took two years to complete. It was a tedious due diligence and heavy negotiation process. John describes what it was like work for the company after the sale and dealing with the resentment of the management. We discuss the pain of laying off long-time employees and adjusting a different company culture. Sometimes, the grass isn’t always greener on the other side. John now works for a company called Digital Acquisitions, a boutique SaaS brokerage that specializes in digital businesses. What you will learn: The history of John’s family business. How he got involved with the business full-time. The family dynamic that led to a lot of frustration for John. How John dealt with an uncooperative atmosphere. Why John finally decided to leave the company and ask his father to sell. The main problems the company had on the basic level. Why location is important in a sale. The headaches of due diligence. Why egos can delay a sale. The two-year selling process that led to employee relation issues. John’s earn-out deal. How the company changed and why John felt it was worse. How the relationship to his dad held out. When John knew he wasn’t staying on with the new owners. What he would have done differently. John’s reflections on the situation in hindsight. What John is doing now for Digital Acquisitions. Takeaways: John’s story is completely relatable to anybody who has worked in a family business. The most important takeaway of his story is, make sure clear and direct expectations are set for anyone in the business, family or not. There needs to be a culture of accountability and a clear vision for the business. Also, keep your family business separate from the family estate so that they are not tied together and stressing the family dynamic. Links and Resources: GEXP Collaborative John on LinkedIn Digital Acquisitions About John: Growing up in Queens, New York within a small family business, John’s experience begins with 15 years of leadership which successfully ran a manufacturing plant. After experiencing the sale of his family’s business, he became hooked on the process of M&A. Combining this with a passion for digital marketing he found his calling as an online business broker. John is always thrilled to discuss ideas and strategize solutions with clients.

Rand Fishkin grew Moz alongside his mother during the mid-2000s. Once they found some venture capitalist investors, Rand was ushered into the CEO role. Moz became a giant in SEO consultation. They raised millions of venture capital and built an impressive reputation. Rand tells me what it was like being CEO of such a big company. He talks about the pressure of venture capitalism and how his thinking changed during his time with Moz. The balance of customer service and the bottom line tend to weigh out differently when investors are involved. Rand expresses his opinion about venture capital and private equity investments. He also encourages alternative funding paths and explains his involvement in TinySeed, a startup accelerator. Rand is currently working on a software called SparkToro. The goal is to help marketers and businesses research their audience and target market. He has made some major changes to his approach to SparkToro and he’s very honest about what he learned from his time at Moz. What you will learn: ● What was Moz and how it began.● What happened when venture capitalist investors approached Moz.● How venture capital investments change the business.● Rand’s push into the CEO position.● How the attitude toward SEO changed over time.● The reasons Rand left Moz.● How he coped with the exit.● The unfair stigma of self-funding.● The benefits of venture capitalism.● The benefits of private equity.● The 2 mindsets a founder can have after an exit.● Why Rand is involved in TinySeed.● What SparkToro is doing differently than Moz.● Ask yourself, what do you need to feel successful? Takeaways: I’m really excited for Rand and the future of SparkToro! Rand’s story reminds me of the basic questions you need to ask yourself when you are planning your company’s roadmap. Why are you in the business? What is your main goal? How do you find capital and potential partners? Do you like your partners? Ask yourself all of these things. Links and Resources: GEXP Collaborative SparkToro Rand on Twitter Rand on LinkedIn Lost and Founder by Rand Fishkin Small Giants by Bo Burlingham Finish Big by Bo Burlingham TinySeed About Rand: Rand runs most of the show at SparkToro. He was formerly co-founder and CEO of Moz, co-founder of Inbound.org, and author of Lost and Founder: A Painfully Honest Field Guide to the Startup World. He doesn’t take himself too seriously, but he does have a bit of a chip on his shoulder, and is deeply passionate about making SparkToro a great company (at least, by his own peculiar standards).

Brian Forcier returns to the show to discuss the exciting development of the 2017 Tax reform and especially the component of the bill that focuses on Opportunity Zones. Brian is the managing partner in Titanium Partners, an investment firm. He tells me about the U.S. Treasury sponsored program and how it can be a game changer for your business. Opportunity Zones are rural areas in America that never fully came back from the 2008 recession. Titanium Partners have dove into this new program and are helping their clients take advantage of the numerous benefits. Brian shares some of those benefits and which business investors would do well to take advantage of the program. What you will learn: Welcome back, Brian Forcier to the show. What is Titanium Partners and what do they do? How Brian and his team develop long-term relationships with clients. What is a 1031 exchange and what does it do? What are Opportunity Zones? The 3 steps to investing in an Opportunity Zone. How simple it is to register the investment as a fund. How are Opportunity Zone investments different from 1031 exchanges. The importance of reinvesting in an Opportunity Zone deal. Why you shouldn’t solely focus on Opportunity Zones. The time window for the program and possible extensions. Why nobody is really talking about this. Who should look into this opportunity and who shouldn’t. The top 5 concerns Brian sees his clients have with the Opportunity Zone option. Takeaways: Don’t jump on this just because it’s cool. Make sure Opportunity Zone investments are a smart play for you. It needs to fit into your plan. Don’t try to shoehorn it in, and make sure you consult someone like Brian before you completely jump into it. Links and Resources: GEXP Collaborative Titanium Partners Conscious Capitalism by John Mackey Brian’s previous episode About Titanium Partners: Titanium Partners operates primarily in the Midwest and the Western US; advising high net worth individuals, family offices, and private businesses on new business developments. Titanium Partners focuses on investment advising and private placement partnerships. Titanium Partners handles acquisitions and sales of commercial real estate and business assets across all investment classes. Currently, Titanium Partners is looking to network with Advisors such as Business Brokers, Real Estate Brokers, Attorneys, Accountants, and Family Office Managers looking for alternative investment options in the private capital space. Titanium Partners plays multiple roles in a variety of investments every day and we have handled hundreds of transactions, worth over $800 million dollars.

Jill Nelson is an entrepreneur who studied business as, in her words, “an act of rebellion.” She wound up as a receptionist for a business broker. She learned firsthand what buyers are looking for in a business acquisition and what gives a company value. That experience led her to build an answering service called Ruby Receptionist. She built a unique product and culture that made buyers flock to her door. Jill explains how she built such a strong culture and made sure Ruby had value beyond the bottom line. Jill’s story is a perfect example of how to do it right and go to market on your own terms. She is still CEO of Ruby Receptionist but she sold her company in a stock sale to a private equity firm. She walks me through the process and explores how it was so different from any other experience she’s had previously in her career. What you will learn: Jill’s decision to study business. How she built Ruby Receptionist. The struggle to get Ruby off the ground. Why metrics are so important. The things Jill believes contributed to her success. Jill’s motto: easy to hire, hard to empower. How she built a unique and valuable business culture. How Jill dealt with the sales process and due diligence. How to create organic growth by empowering. Why an investment broker was a key part of Jill’s deal. How finding alignment with buyers is a lot like dating. What life is like as Ruby’s CEO. Jill’s advice to the audience. Takeaways: Jill is a textbook example of the five principals. She had the vision of what she wanted. She aimed for targets to build value into her business. She researched her exit plan options and found the right one for her. She created a system that could run without her. She was on top of due diligence and hired the right people to help her. Links and Resources: GEXP Collaborative Ruby Receptionist Jill on LinkedIn Jill on Twitter About Jill: A driven entrepreneur passionate about building a one-of-kind company, Jill Nelson has grown Ruby Receptionists into a nationally recognized organization for its inclusive, people-powered company culture and its record-breaking position as one of Oregon’s fastest growing companies for the past 11 years. Since founding the company in 2003, Jill has led Ruby to double-digit revenue growth every year, and in 2015 sold the majority share of Ruby for $38.8 million to Updata Partners. In addition to her own entrepreneurial endeavors, Jill has been recognized by her peers, receiving the Pacific NW 2017 Ernst & Young Entrepreneur of the Year Award and named the 2017 Oregon Technology Executive of the Year—the first woman to receive this recognition. A fervent supporter of local business, Jill has served on the board of Entrepreneurs Organization in a variety of roles including President of the Portland chapter and acted as a mentor in its Accelerator program, successfully helping business owners reach the $1,000,000 revenue mark.

Welcome back to Life After Business. This episode is part two to my interview with Michael Kaplan. Michael was a financial partner in a carpet cleaning business called ZeroRez. To recap, episode 135 is the companion episode to this one. During the last episode, Michael told the story of how he got involved in ZeroRez and how they grew a 300 thousand dollar business to 18 million. This episode, Michael explains why he exited the business and how his relationship with his partner changed. Michael and his partner had an agreement laid out since day one. There was a clear protocol to solve problems established. As time went on, however, the agreements began to erode. Michael honestly explores how the communication broke down and the last straw event that led to what he calls “the Mexican Standoff.” Michael is very candid about what happened in his partnership and he doesn’t shift all the blame to his partner. It is a real glimpse of how business partnerships work and why you need to lay all your cards out and stick to your guns. What you will learn: A quick recap of part one of this interview. How the original partnership began and the initial agreements. How Michael protected himself when other partners left. How they handled the first departures. What is a “shotgun clause” and why do you need one? A change in capital structure. A new Omaha location and the lessons learned from the experience. An offer to purchase equity in the franchise. Why they didn’t just buy the franchise. The beginning of agreement erosion and the issues that developed. The launch of new locations and the success and growth rate. Addressing the problem of “meddling” with the technicians. A change in company culture and Michael’s view on it. Why he left the leadership team and the fallout. The last straw that led to Michael’s exit from the company. The Mexican Stand-Off that got Michael out of the bad situation. The lessons learned from the experience. How Michael vets business relationships now. Links and Resources: GEXP Collaborative Red Hook Investments Michael’s emailBooya Capital Partners Life After Business Episode 135 Takeaway: Make sure you have solid agreements with any partners from the very beginning of your business. Be transparent and make sure everybody is on the same page. About Michael: Michael Kaplan spent most of his 20s thinking he would go into some sort of law practice. However, he found himself partnering with a friend to purchase ZeroRez. After a few stumbles and lucky economic breaks, Michael and his partners were able to scale the carpet cleaning business to 18 million dollars. After erosion of partnership agreements and some company culture issues came to light, Michael exited ZeroRez. He credits the use of a “shotgun clause” for diffusing the situation and teaching him something about his business expectations moving forward. He currently works with Red Hook Investments, a firm that specializes in turnarounds, private equity, and cash infusions.

Today’s guest has a story so big and honest, I had to break it into two episodes. Michael Kaplan was a financial partner in ZeroRez, a Minnesota based carpet cleaning company. He is super authentic and honest about what it was like to scale a 300 thousand dollar business up to 18 million. Part one of this interview focuses on how Michael stumbled into the carpet cleaning business and the ups and downs that he and his partners encountered. We discuss the mistakes Michael and his partners made with money and hiring. Both are costly to a business. Michael also leveraged an economic downturn and existing radio budget to work in the business’s favor. It is really an impressive story of a radio campaign changing things overnight. I ask Michael to tell me about how they handled the sudden growth and what the business did to encourage repeat customers. He answered with brutal and refreshing honesty that I think every business owner should hear. If you really want to know what it’s like in the trenches in a business, today’s episode is an accurate depiction. What you will learn: Michael’s early experience in startups, law, and how he wound up in the carpet cleaning business. What the purchase of ZeroRez looked like and why it was a bad deal. The mistakes that Michael and his partners made early on. How the 2008 housing crisis worked in ZeroRez’s favor. The radio budget and how it transformed the business. The things Michael thinks made the company successful. The hiring mistakes that ZeroRez made early on and how they corrected them. Why investing in good people can help you fix outgrown SOPs. How Michael shifted his mindset to a value-based one. The cliffhanger for part two. Takeaways: Michael’s story is a great example of what it takes to build a company. It takes balls and you can’t just be passive. Part two of this interview has some great nuggets about working with partners. Everybody has drama in their business, especially behind closed doors. Having a partner changes how you do anything in a business and part two showcases that. Links and Resources: GEXP Collaborative Red Hook Investments Michael’s email About Michael: Michael Kaplan spent most of his 20s thinking he would go into some sort of law practice. However, he found himself partnering with a friend to purchase ZeroRez. After a few stumbles and lucky economic breaks, Michael and his partners were able to scale the carpet cleaning business to 18 million dollars. He currently works with Red Hook Investments, a firm that specializes in turnarounds, private equity, and cash infusions. Tune in for the second part of this interview to hear Michael’s complete story.

Bill Smith is a principal consultant for Navigate Group, a strategic business solution provider. Navigate works with business owners and high-level executives to find ways to save the company money through tax benefits and expense evaluation. It is a win-win situation that provides leverage to your company and takes a lot of the stress out of the equation. Bill tells me about the leverage funded program and the other services Navigate offers to its clients. We cover who should use this service and why it is essential to getting your business past a hump and moving into a new stage of growth. He also shares why CPAs and banks tend to love Navigate’s involvement and why insurance guys don’t so much. If you’ve hit a wall in your business, then today’s episode is a must-listen for you! What you will learn: How Navigate got started and why they exist. Why you want Navigate involved in your end-game. The 3 silos of service Navigate provides its customers. How Navigate is different from other loan services. Navigate partners with CPA firms. How Navigate’s deferred compensation contract works. How the system works for the client. How the system works for the banks. The 3 events that will end a contract and what happens next. The pros and cons of release mechanisms in your deals. A typical Navigate policy. Why Navigate prefers a narrowed focus of services. Who should use Navigate’s service? The changes to and 4 components of the RND Tax Credit. Takeaways: You should totally look into this! Call Bill! Call me! This company is providing something valuable and there aren’t a lot of downsides to the process. Look into the Navigate Group and see it’s something worth your time. Links and Resources: GEXP Collaborative Bill on LinkedIn Navigate Group 617-529-8577 Life After Business Episode 131 Life After Business Episode 107 About Navigate Group: We are a unique group of professionals bringing active consulting services to a wide range of clients. Our unique ability to dig into a business and ask the right questions allows us to bring true value to Business Owners, CEOs and CFOs by providing solutions that increase overall profitability and cash flow. Navigate Strategic Resources will increase overall profitability while providing cost reduction solutions and consulting services. We are a Trusted Source increasing business value and guiding our clients with sound business solutions.