Ep.#5 [THEME SIX]   I have personally wasted hundreds of thousands of dollars on failed marketing strategies…and I know I’m not the only one who feels like I’m throwing spaghetti against a wall while money flies out the window.    In last week’s episode, we framed up what marketing KPIs matter and how to connect those metrics to the financials. Today we’re going to talk about why it’s NOT NECESSARY to guess anymore by implementing an engineering approach toward marketing.   In today’s interview, I’m talking to Chris Sanchez, who is the lead advisor at Mint CRO (co-founded by one of the top marketing leaders at Microsoft). Mint CRO has provided CRO training and expert coaching to hundreds of entrepreneurs and marketers to accelerate growth, improve lead quality and sales conversions, and reduce ad spend. Clients have achieved 2X to 10X repeatable growth using Mint CRO’s systematic testing methodology, radically transforming their marketing results.   Chris shares with us Mint CRO’s eight-step process on how to take the guessing away from marketing so you can understand what your customers want–all for under $1,500! Yes, it really is that inexpensive to understand which pain point you solve for your customers, what free offer they want from your brand, and if they are even looking at the offer page that you spent tens of hours building.   The takeaway–There is a simple way to test your marketing to ensure your offer is something people actually want via an engineering approach toward marketing.    This methodology applies to every business–even Arkona (listen in to hear how we’ve used this strategy)!   // WATCH THE INTERVIEW ON YOUTUBE: Intentional Growth™ Podcast   What You Will Learn: What Mint CRO is and why it allows companies to predict their growth. Why the engineering approach to marketing allows business owners to invest strategically into their marketing so they get the return on marketing they desire. The first thing you must have dialed in before you build a marketing funnel. How to test messaging with a simple “thumb stopper” approach. The three KPIs that define a winning message or tagline.  Why you should test an offer before the offer is even made. Tools to use to clearly see if people are even engaging with your marketing efforts. How an engineering approach to marketing can predict your customer acquisition cost. Where this advertising approach can fit into a company's marketing strategy.   // USE YOUR FINANCIALS TO CLARIFY A PATH TOWARDS A MORE VALUABLE BUSINESS: Intentional Growth Financial Assessment   Bio: Chris Sanchez is the lead advisor at Mint CRO, a marketing training company that helps entrepreneurs optimize their conversion rates and help businesses 10x their growth.   MintCRO Chris on LinkedIn Arkona Website The 5 Intentional Growth™ Principles (5 Videos to Help Clarify Your Vision) Intentional Growth™ Financial Assessment Fractional CFO Services   You can also reach out to me via email at rtansom@arkona.io, or on my LinkedIn.

Ep.#4 [THEME SIX]   Do you know what your return on marketing spend is and if it is growing the equity value of your company?    A lot of business owners see marketing as an expense because they cannot clearly connect the marketing spend to a return on investment (also known as return on ad spend or ROAS).    Today we have Jeff Campbell, co-founder of aiCommerce, on the show to walk us through what it takes to turn marketing into an investment. Jeff is the perfect person to speak on this topic because he has been an agency owner, sold his business, and now invests in–and manages–companies and brands.   Jeff is one of the only people I have been able to have a dynamic conversation with about marketing strategies AND financials all at the same time ;-) He truly “gets it” and breaks it down in a way that should give anyone hope that marketing doesn’t have to be a money pit and can, in fact, be an engine for equity growth, if done properly.   The three main takeaways of today’s interview are: 1) identifying the right KPIs, 2) how to calculate your contribution margin so you know how much it costs you to deliver your product or service, and 3) how to test different advertising channels while maintaining your desired ROAS. In addition, Jeff breaks down the very few levers he pays attention to when market testing a new product or service.   Marketing shouldn’t be a guessing game. If you can understand how much it costs you to deliver your product and the lifetime value of a customer, you can market with a clear outline of what works and what doesn’t.   If you want to answer the question: “How much money should I spend on advertising, with which products, while maintaining x margins, while maintaining and growing cash flow?” then you will want to tune in to this episode as well as the next one ;-)   // WATCH THE INTERVIEW ON YOUTUBE: Intentional Growth™ Podcast   What You Will Learn How to think about marketing as an investment and not an expense. What costs go into marketing and why the ROAS calculation is flawed with many brands. The different types of marketing that brands (companies) should be doing and why revenue should not be top priority. Jeff’s metrics (KPIs) that matter when scaling a company’s valuation. What contribution margin is, how to calculate it, why it matters, and how to use it. How to intentionally invest in marketing when you know the lifetime value of your customer. When and why breaking even on marketing can be a good strategy. How to integrate your marketing roadmap into your financial roadmap. How to think about your ROAS and the cash flow implications on different products and services. Jeff’s recommendations on how you test different channels and platforms. The levers that Jeff pays attention to with online advertising to improve the overall conversion rate.   // USE YOUR FINANCIALS TO CLARIFY A PATH TOWARDS A MORE VALUABLE BUSINESS: Intentional Growth Financial Assessment   Bio: A proven marketing executive with an entrepreneurial approach, Jeff is responsible for strategic vision, client services, P&L management, revenue growth, talent development, and the overall success of business operations at aiCommerce. Jeff’s background includes strategy development, media integration, and attribution for brands such as Mercedes, Lowes, Apple, Disney, and FedEx, activating across search, social, SEO, and programmatic media platforms. Prior to aiCommerce, Jeff co-founded Resolution Media, Omnicom’s performance marketing arm and a top three global partner of Google and Facebook. His teams’ marketing innovations have been well recognized with industry accolades that include Cannes Lions, Digiday Sammies, Effies, Clios, Shorty Awards and more.   Interview Quotes: 14:28  - “The more you spend in [Amazon] ad-spend. The more you take advantage of their advertising opportunities, the organic visibility goes up.” - Jeff Campbell 16:29 - “Not every sale is a profitable sale.” - Jeff Campbell 17:04 - “Revenue is vanity and profit is sanity.” - Jeff Campbell 25:10  - “This is definitely specific to the world of Amazon where there is a relationship between ad-spend and organic visibility.” - Jeff Campbell 35:30 - “One of my favorite quotes is, ‘At the root of all anger is violated expectations.’” - Jeff Campbell 36:00  - “Have a road map. Understand what a crawl, walk, run looks like.” - Jeff Campbell 37:58 - “Is the overall marketing pie getting bigger? Usually the answer is not…then the slices have to change.” - Jeff Campbell 49:22 - “Time is my biggest limited resource.” - Jeff Campbell 50:33  - “I’ve actually seen the smaller and the mid-sized companies doing this well. It’s the big brands that aren’t.” - Jeff Campbell   Links and Resources: Aicommerce.com Jeff on LinkedIn Arkona Website The 5 Intentional Growth™ Principles (5 Videos to Help Clarify Your Vision) Intentional Growth™ Financial Assessment Fractional CFO Services   You can also reach out to me via email at rtansom@arkona.io, or on my LinkedIn.

Ep.#3 [THEME SIX]   Do you know if owning and running a business is worth it for you? I have been hearing that question a lot lately. Today’s episode is all about figuring out the best way to answer that question.   I have never met an entrepreneur or business owner that doesn’t know how to tell one hell of a story about where they have been, where they are, and where they want to go…however, I find most entrepreneurs don’t have the confidence to hit the throttle because they are afraid of the plan not working, running out of cash, and don’t have a clear sight into whether that plan will help them hit the future equity valuation they want in the future.   On today’s episode we have my new partner at Arkona, Joel Beyer, on the show. Joel owned a multigenerational company that sold to the private equity firm my other partner, Matt Buskirk, sold to (and ran). Joel truly understands what it takes to build a plan, execute like hell, and course correct as things change.    Today Joel and I talk about why the current method of planning, budgeting, and forecasting is broken, what it can (should) look like, and what to do about it.    Joel breaks down why it’s important to normalize all of your company data under one dashboard; how to get started collecting your data, tying the short-term plan to the long-term equity target, and how to create a rolling forecast that updates your plan each month based on what was actually accomplished; and then updates your plan and progress toward your long-term goal.   This was a super fun conversation that was heavily rooted in planning and finance…all without a bunch of financial jargon. I hope this helps you answer the most important question we all need to answer….“Is this worth it?”   WATCH THE INTERVIEW ON YOUTUBE: Intentional Growth™ Podcast   What You Will Learn Why the current method of planning, budgeting, and forecasting is broken. What bad financial planning looks like and what needs to be done to fix it. How to tie your operational data, workforce data, and financial data together into a holistic plan that actually makes sense to the brain of an entrepreneur. How to create value drivers into your plan so you can clearly see where you need to invest and why. How to spot future bottlenecks or tight cash positions. How to get visibility into the tradeoffs between distributions, funding growth, and taxes. How to answer the question, “If I hit the gas on our plan, what is the future impact on cash flow and valuation of the company?” How to eliminate “spreadsheet hell” because you are creating spreadsheets that are in isolation and not tied to the financials. What makes up a good foundation to start your planning process to grow the equity value of your business. How marketing should be tied into your financials. The data sources you need to connect and use to predict your future cash flow. Why you can eliminate the drudgery of annual budgeting by creating a roll forward plan that is always updating your future plan based on what you actually did. How to make sure taxes are never a surprise again. The difference between a locked plan and a roll forward plan. How to use your plan when you need to pivot.   // USE YOUR FINANCIALS TO CLARIFY A PATH TOWARDS A MORE VALUABLE BUSINESS: Intentional Growth Financial Assessment   Bio: Joel Beyer started his career in a family business, working in all facets of the company. After acquiring the company, he focused heavily on business optimization and automation. Joel then led the company through a successful sale to a PE firm. He became the EVP of Strategy and Business Improvement at Impact group and continued to focus on optimization through a sale to a strategic buyer. His goal in joining Arkona is to use his previous experience to help business owners optimize their companies to achieve full potential.   Interview Quotes: 11:31  - “It was a heavy lift for a year and a half to get all that data working together and doing all the changing of the management with the people as well. But it’s so important to peel the onion all the way back and then rebuild stronger.” - Joel Beyer  15:24  - “If you lose a big client, you remember that one. But maybe you lose five small ones that don’t really hit your radar, that add up to a mid-sized client. And that doesn’t carry over in your feel of your churn rate. A lot of companies are actually surprised by their churn rate.” - Joel Beyer 23:12  - “The first thing you need to understand is, ‘Do my historical financials, are they accurate? And are they granular enough to understand my business?’” - Joel Beyer 25:32  - “Processes that you ultimately put in place around bookkeeping and organization of your financials helps you inform the future. If you can count on your historicals, you can have a much clear view and be more secure in your planning.” - Joel Beyer 45:46  - “We’ve got different types of data coming in that need to get connected. Where we’re connecting it or where we’re going to report from it, needs to understand it in a certain way.” - Joel Beyer 01:04:40  - “The first plan we’ll do is we’ll build those drivers to do a role for that plan.” - Joel Beyer 01:12:39  - “You get monthly feedback on how you’re executing against a goal. And that’s so important, I can’t stress that enough.” - Joel Beyer   Links and Resources: Arkona Website The 5 Intentional Growth™ Principles (5 Videos to Help Clarify Your Vision) Intentional Growth™ Financial Assessment Fractional CFO Services   You can also reach out to me via email at rtansom@arkona.io, or on my LinkedIn.

Ep.#2 [THEME SIX]   Today we are launching episode two in our mini-series “How to Grow The Equity Value of Your Company.” Patrick Donohue from Hill Capital joins us to talk about his newly released book, Breakout Valuation: How To Finance Your Future Today.   During the interview, Patrick shares the nine components of a breakout valuation and how to use the financials as a road map to get you where you want to go. Patrick and Ryan discuss what it means to view and run a company like a financial asset and why there is a ‘capital gap’ in the middle market. Patrick then explains the different sources of capital, why they are different, and how to match the right type of capital with the long-term equity valuation goal of the owner. Even if finance isn’t your thing, this episode is for you. Patrick does a great job of explaining why it’s worth understanding the financials and how they give the necessary clarity on how to create a valuable asset.   // WATCH THE INTERVIEW ON YOUTUBE: Intentional Growth™ Podcast   What You Will Learn What a breakout valuation is and how to achieve one. Why the financials are the key to achieving a breakout valuation. What the capital gap is and why it impacts so many privately held businesses. What capital matching is and why it’s so important to get it right. The nine components of a breakout valuation. Why the founder and/or CEO’s magnetic vision is so important. What trust and emotion have to do with a breakout valuation. How the foundation of a vision is essential to a breakout valuation. The trifecta of cash management. The five big cash traps. What the ‘capital ecosystem’ is and why it matters. Why debt over equity can be beneficial for an entrepreneur in the long term.   // USE YOUR FINANCIALS TO CLARIFY A PATH TOWARDS A MORE VALUABLE BUSINESS: Intentional Growth Financial Assessment   Bio: Patrick Donohue is an Innovator, investor, financial analyst, investment banker, and entrepreneur. He specializes in finance strategy and executing corporate development initiatives for growth companies. He has helped author and execute numerous capital formation plans from start-ups to equity growth capital. His core skill-set is developing market intelligence to advise companies on growth initiatives and equity capital formation. His experience is in several industries at various points within the corporate life cycle. In particular, He has spent considerable time working on financial technology, medtech, healthtech, healthcare, energy and the metals / mining industries (and of course finance!).   Interview Quotes: 08:44  - “I’ve always found capital transactions extremely interesting: why some companies are able to raise money and some are not.” - Patrick Donohue 12:13  - “They need the money, beyond what they can get from the bank, but their business model (thier economic engine) doesn’t justify or can’t potentially provide the minimum 10x or 100x return that a venture fund needs to buy equity into that business.” - Patrick Donohue 15:39  - “Don’t assume. Don’t let one no stop you. The name of the game in private capital formation is a numbers game. You have to have a lot of conversations. There are investors out there for every businesses, I will argue. But for some businesses, it takes hundreds of conversations.” - Patrick Donohue 17:12  - “So the idea of capital matching is to make sure that the money that comes in the business, any external capital that comes into the business, matches the needs of where the capital is going to be utilized. All capital needs to be paid back at some point in time.” - Patrick Donohue 31:19  - “The business owner really needs to articulate what the business is can do in the future. But not only do that but do that in a way that really attracts other people to the vision, thus magnetic. Attracting people to it.” - Patrick Donohue 41:49  - “At the end of the day, it’s about the people. It’s not going to be quantified in a software algorithm.” - Patrick Donohue 54:29  - “I don’t know if it’s a financial literacy problem. I think if we peel back the onion a little bit–and maybe this is why I started out with things in the book like confidence and curiosity and so forth but–I think a lot of it has to do with mindset.” - Patrick Donohue   Links and Resources: Connect with Patrick on linkedin Breakoutvaluation.com patrick@breakoutvaluation.com Arkona Website The 5 Intentional Growth™ Principles (5 Videos to Help Clarify Your Vision) Intentional Growth™ Financial Assessment Fractional CFO Services You can also reach out to me via email at rtansom@arkona.io, or on my LinkedIn.      

Ep.#1 [THEME SIX]   Today we are kicking off theme six, How to Grow The Equity Value of Your Business.   In this episode, Ryan Tansom is going solo to explain what's to come in the next couple of weeks within this theme. He explains the importance of setting a proper (and achievable) financial goal based on what you, as the business owner, want to take home in distributions each quarter.    Ryan explains how setting a proper financial goal will help you become strategic with your budgeting and reinvest into the company with a desired ROI each quarter.    This episode is a high-level overview of this theme. Throughout this series, we dive deep into financial planning, tying marketing into your financials, and discovering an easier way to map out your processes and procedures.   //WATCH THE INTERVIEW ON YOUTUBE: Intentional Growth™ Podcast   What You Will Learn How to set a proper goal (financial roadmap). Why just a revenue goal is not good enough. The correlation between setting a good financial goal and having the day-to-day constraints be worth it. How EOS and financial planning go hand in hand during annual planning. How the three financial statements will give you a clear lens on how to reinvest into the company every year. How proper budgeting can predict what you will make within the next year. The 50/50 budgeting rule and why it’s important.   // USE YOUR FINANCIALS TO CLARIFY A PATH TOWARDS A MORE VALUABLE BUSINESS: Intentional Growth Financial Assessment   Bio: Ryan Tansom started his entrepreneurial career at his family business where he was the Executive VP and responsible for the strategic, operational, and financial strategy of the $21 Million company. Ryan helped turn the company around and bring intentional focus to the right strategies which enabled it to be sold for 8 figures to a local competitor in 2014. Ryan took his experience and founded Arkona, with his partner Pat, to create theIntentional Growth™ Framework which helps owners grow the value of their company with an end in mind through educational training, fractional CFO services and strategic planning. Ryan also hosts the popular Intentional GrowthTM podcast that has 310+ episodes, 420k+ downloads and guests like Gino Wickman, John Warrillow, and the editors of HBR and Inc. Magazine. Ryan also has a passion for speaking and delivers frequent keynotes. After thousands of meetings and hundreds of podcast interviews, he has his finger on the pulse of the market like few others.   Interview Quotes: 09:39  - “Only acquire a company that’s going to increase the value of your company and your chances of getting to that $12 million equity-valued company faster or bigger.” - Ryan 11:12  - “You have a lifestyle business if you are sucking all of the cash out of the company through salaries, perks, and distributions and you’re solving for annual income or for that K1, without understanding how that is impacting how you’re able to fund your growth plan on the way to getting the equity-valuation you want at any point in time.” - Ryan 18:20  - “What do you need (in income, through salary and distributions every year) to make it worth it?” - Ryan 20:10  - “If you go back to the Demystifying Business Valutation Miniseries, we talked about the intrinsic financial value versus the strategic transaction value. And the reason why I liked this [series] is because it is a framework to thinking about valuations.” - Ryan 20:37  - “The intrinsic financial value is the value of a business as it stands today, as you own it, based on the risk of the cash flow.” - Ryan 20:46  - “Truly, you don’t have to sell the business to tell what it’s worth.” - Ryan 21:03  - “The [strategic transaction value] is when a buyer and a seller come together and there is a purpose of a deal.” - Ryan 28:24  - “A multiple, in just the simplest terms, is the number of years of cash flow (normalized EBITA) a buyer is willing to pay for a company.” - Ryan 31:18  - “The goal is to derisk that cash flow.” - Ryan   Links and Resources: Intentional Growth Vision Board Arkona Website The 5 Intentional Growth™ Principles (5 Videos to Help Clarify Your Vision) Intentional Growth™ Financial Assessment Fractional CFO Services   You can also reach out to me via email at rtansom@arkona.io, or on my LinkedIn.

We all know how well the stock market is doing on any given day. All we have to do is pull out our phone or turn on the TV. What happens if you want to know how well the middle market of private businesses are doing? Where would you find the data? It’s not as easy as pulling out your phone, which is exactly why we did today’s interview.    The middle market (businesses from $5 million to $1 billion) make up one-third of the US GDP. If this segment of companies was its own country, it would be the fifth largest GDP in the world. Even with the sheer size of the market, these companies don’t get a lot of attention; therefore, there is limited data, insights, and leading indicators on the overall health of over one-third of the US GDP.    Today, Doug Farren, Director of The Center for the Middle Markets, is on the show to share the results of their semi-annual Middle Market Indicator (MMI) where they surveyed 1,000 middle-market companies.    Doug reviewed the results of the MMI, discussed the five focus areas of the report (listed below), and how well the middle market is doing compared to over ten-plus years of the survey. Along with diving into the MMI, Doug also shares the findings of a new report they just wrapped up called “Owner Transitions in the Middle Market.”   Because of how big the middle market is, if something big were to happen in that part of the economy, it affects all of us. That’s why these reports and what the National Center of the Middle Market is doing are so important.   WATCH THE INTERVIEW ON YOUTUBE: Intentional Growth™ Podcast   What You Will Learn The mission, and the reason for the existence of, the National Center for the Middle Market. How the National Center for the Middle Market captures their information from 1,000 middle-market companies two times per year. The 2022 findings behind the five main focus areas of the MMI survey: The three big issues middle-market companies are worried about when looking into the future. How the COVID disruption is still impacting supply chains and middle-market companies. An overview of the hiring and recruiting issues in middle-market companies. How the middle market is dealing with returning to the office and/or hybrid work. What most business owners are doing with their proceeds after they sell. The three challenges that business owners are having when preparing to sell. How large Fortune 500 companies are getting help from the National Center for the Middle Market. Why everyone should care about giving more attention and resources to the middle market.   // USE YOUR FINANCIALS TO CLARIFY A PATH TOWARDS A MORE VALUABLE BUSINESS: Intentional Growth Financial Assessment   Bio: Doug Farren joined The Ohio State University Fisher College of Business after an 11-year career at Limited Brands, where he most recently served as senior manager of supply chain planning. His responsibilities included developing the supply chain network and planning/allocation functionality for inventory to support three distinct international store channels. Farren started with Limited Brands as a summer intern while completing his MBA in Operations and Logistics Management at Fisher. Farren’s previous experience includes work for Six Sigma Qualtec, a process improvement consulting firm based in Scottsdale, Arizona.   His primary functions included marketing strategy, new client relationships, and on-site training and implementation. As part of his responsibilities, he was certified in 1998 as a Six Sigma Black Belt in Transactional Quality. Farren holds a Bachelor of Science in Marketing from Penn State University, where he was a member of the football team as an athlete and student assistant under Joe Paterno. He is an active member of the Penn State Football Letterman’s Club.   Interview Quotes: 14:50  - “The middle market is everywhere.” - Doug Farren 20:11  - "The report is just the tip of the iceberg." - Doug Farren 27:00  - “12.2% revenue growth is the highest we’ve seen." - Doug Farren 41:05  - “Most business owners that sell are reinvesting (into new businesses)." - Doug Farren 53:12  - “(Big Fortune 500 companies) are reaching out for help on how to better understand the middle markets." - Doug Farren   Links and Resources: Owner Transitions in the Middle Market Report Middle Market Indicator (MMI)   Arkona Website The 5 Intentional Growth™ Principles (5 Videos to Help Clarify Your Vision) Intentional Growth™ Financial Assessment Fractional CFO Services   You can also reach out to me via email at rtansom@arkona.io, or on my LinkedIn.

Today we have Jeanne Voigt on the show to talk about her experience starting, growing, and selling MindWare, a catalog and online retailer of educational toys.   Jeanne started MindWare after leaving the corporate world when she was 39. Today she dives into detail about her initial go-to market strategy, why she realized her business model needed to be restructured, and how she “bet the farm” to grow a company that she would eventually sell after getting an out-of-the-blue offer she couldn’t refuse.    Even though the offer was one she couldn't refuse at the time, Jeanne reflects during the interview about what worked and what did not and the things she may have done differently.   WATCH THE INTERVIEW ON YOUTUBE: Intentional Growth™ Podcast   What You Will Learn Why Jeanne decided to become an entrepreneur after talking with a mentor. How Jeanne built and scaled her business by simply observing what people wanted. How Jeanne realized she needed to rethink her business model and what she did about it. Jeanne’s story on “betting the farm” with her business while having no cash. How an out-of-the-blue offer shifted her mindset on the long-term vision of the company. Why Jeanne decided what she wanted and why out of her exit. How Jeanne compared the different offers and different buyers and why she made the choice she did.  Why Jeanne brought her staff in on the meeting with potential buyers (even though that can be risky). The most important thing to MindWare’s employees when it came to what they wanted with a buyer. Some of the challenges of operating the company post-transaction–and why everyone was not aligned–even though the buyer was the top choice. Why the emotional side is something to keep in the forefront of your mind while going through the exit process. Jeanne’s reflections on what worked and what she may have done differently–based on what she knows now–during her journey growing and selling MindWare.   // USE YOUR FINANCIALS TO CLARIFY A PATH TOWARDS A MORE VALUABLE BUSINESS: Intentional Growth Financial Assessment   Bio: Jeanne M. Voigt is the founder of MindWare, a catalog and online retailer. She sold the company in 2003 but continued as president until 2007. She currently serves as a consultant and board member for the company and is also CEO of a startup decorative arts licensing business in Minneapolis. Prior to MindWare, Voigt was an executive at First Bank System (now U.S. Bank), where she held positions in operations, cash management, and strategic planning. She is active as both a funder and volunteer for the Jeanne M. Voigt Foundation, begun in 2003 to further women's economic development in emerging economies. Voigt has an undergraduate degree in music education and a master's degree in business finance, both from the University of Minnesota. She has been active in nonprofit endeavors, including the Minnesota State Arts Board, the Minnesota Dance Alliance, and Destination Imagination. She is a member of the Minnesota Multiple Sclerosis Society and the Metropolitan State University's Center for Women Entrepreneurs.   Interview Quotes: 09:50  - “There was sort of this risk aversion thing. In fact, when I left my corporate job, my dad was really concerned. He could not understand why I would leave a corporate job where I was making really good money, I had respect. So that was a tough thing to do.” - Jeanne Voigt 11:45  - “You know? I don’t want to just sell this stuff. I want to do something more. I want to learn more about it.” - Jeanne Voigt 22:43  - “If there is a regular process that’s in place and the job is to simply follow it, that’s not the job for me.” - Jeanne Voigt 48:35  - “I was good at hiring creatives. I’m good at hiring them, I’m good at working with them and keeping them motivated.” - Jeanne Voigt 53:12  - “It is that thing with entrepreneurs where we go along and we say, ‘I believe in this. I believe in it.’ Then when it does happens, you’re like, ‘My God! I really did it!’” - Jeanne Voigt 55:05  - “Every year that it got bigger at Christmastime, it was riskier. Because any I could be blown out of the water.” - Jeanne Voigt 01:11:53  - “It’s not all about money. We’re invested in these companies totally. They mean something to us and the people who work there mean something to us.” - Jeanne Voigt   Links and Resources: Jeanne Voigt email: jeannevoigt@gmail.com   Arkona Website The 5 Intentional Growth™ Principles (5 Videos to Help Clarify Your Vision) Intentional Growth™ Financial Assessment Fractional CFO Services   You can also reach out to me via email at rtansom@arkona.io, or on my LinkedIn.

Ep.#12 [THEME FIVE]   As we wrap up our four-part mini-series on ESOPs, we’re getting out of the weeds and coming back up for air.    Today we’re going to be talking about ESOPs acquiring other companies and ESOPs selling to a third party (yes, both are possible!). In the second part of this episode, we finish with an owner's success story about why he turned his company into an ESOP and the amazing things that have happened since.   In part one of this interview, Jim Steiker from SES ESOP shares his story about how hitchhiking led to a multi-decade career promoting ESOPs. He then dives into the full life cycle of an ESOP. He starts the segment with an awesome twist (a strategy that a seller can follow who DOESN’T want to take the time to convert to an ESOP but would like most of the legacy benefits): how a company can sell TO an already-formed ESOP. Jim explains the three reasons why most business owners don’t want to convert to an ESOP and how these reasons can be overcome by selling to one that is already formed. Jim then goes into detail on a few different strategies about how ESOPs can acquire companies and why. Jim finishes the segment by explaining how ESOPs can be sold to third-party buyers, how it works, and what it means to the employees.    In part two of this interview, Ken Baker, CEO of New Age Industries, shares his owner's success story on how and why he turned his company into an ESOP. He explains–via his own experiences–how to maximize the benefits of the ESOP by ingraining it into your culture through education, strategy, and execution. To date, New Age Industries has created 54 millionaire employees. Ken explains why he believes an ESOP is one of the purest forms of capitalism and business models he has come across.    Thank you for coming on this ESOP journey with us. We hope this series demystified ESOPs for you and got you up to speed on what they are, how they work, and why an ESOP might be the best fit for your company.   // WATCH THE INTERVIEW ON YOUTUBE: Intentional Growth™ Podcast   What You Will Learn   Part 1: How Jim hitchhiked and became passionate about ESOPs. ​​The differences between selling to an already-formed ESOP and the normal M&A process of selling to a third party. The three main reasons people don’t sell to an ESOP. How–and why–selling to an already-formed ESOP can overcome many of the typical reasons sellers don’t pursue an ESOP. The full life cycle of an ESOP company. Why an ESOP company is a good exit alternative for a company who is not big enough to become an ESOP themselves.  How–and why–ESOPs acquire other companies. How employees are treated when under an ESOP vs. a third-party buyer. What the process is like for an ESOP company to be sold. What happens to employees if an ESOP is sold. Jim’s hopes for EOX and ESOPs. Part 2: Ken’s personal story about buying the company from his father, researching ESOPs, and why he knew decades ago an ESOP was the model for him and the company long-term. Why Ken thinks an ESOP is the best business model. Why it’s crucial to ingrain education in the company culture to teach employees to think like owners and how he did it.  The benefits Ken saw with the company growth after turning into an ESOP. Ken’s explanation on how to get employees to think like owners without letting them think that they have involvement or control in all the company decisions.  The phased approach Ken took when converting his company into the ESOP. How Ken manages his several stakeholders (employee owners) in the company and why he continues to remind them that they are owners. How Ken manages company meetings to incorporate ownership thinking. Which financials Ken has chosen to share with his employee owners and why. How doing an ESOP has helped Ken with recruiting, especially in this current hiring environment. The share price of Ken's company went up as he sold to the ESOP in four different segments. Ken’s simple vision for his ESOP and his hopes for EOX and ESOPs in America.   // USE YOUR FINANCIALS TO CLARIFY A PATH TOWARDS A MORE VALUABLE BUSINESS: Intentional Growth Financial Assessment   Bio: Jim Steiker Jim is Chairman of SES ESOP Strategies, an affiliate of the Stevens & Lee Companies. He is a corporate, pension, and tax attorney and financial advisor with more than 35 years of experience in ESOPs and other employee ownership matters. He focuses his practice primarily on ESOP design, transactions, and compliance in entrepreneurial companies. Jim has served on the ESOP Association Board of Governors and is a past chair of the ESOP Association’s Advisory Committee on Finance. He is also a trustee of the Employee Ownership Foundation and a former member of the Board of Directors of the National Center for Employee Ownership. He is a director of the Employee Ownership Expansion Network and also serves as a director of seven ESOP companies. A frequent author on ESOP matters, Jim has contributed to numerous National Center for Employee Ownership publications, including ESOPs and Corporate Governance, The ESOP Company Board Handbook, Responding to Acquisition Offers in ESOP Companies, Administrative Issues for ESOP Companies, Seller-Financed ESOP Transactions, Warrants in ESOP Transactions, and Don’t Do That: Common Mistakes in Operating an ESOP and What to Do About Them. He has also authored articles on ESOPs for many trade journals. Jim presents regularly on ESOP topics to the annual and regional meetings of the ESOP Association and the National Center for Employee Ownership, ESOP state employee ownership center conferences, and to general and professional audiences. Recent presentations include “LLC Structures and ESOPs,” “The Evolving Fiduciary Process: Practical Guidance for Plan Sponsors and Fiduciaries,” “Selling Your Company to an ESOP,” “Highly-Leveraged ESOP Transactions,” “ESOP Transaction Structures,” and “Is an ESOP Right for You.” Ken Baker: Ken Baker is the CEO of NewAge Industries, a plastic and rubber tubing and hose manufacturer and RFID tag solutions provider located in Southampton, Pennsylvania. In 2006, Ken established the company’s Employee Stock Ownership Plan (ESOP), and in 2019 he sold his remaining shares to the ESOP, making New Age Industries a 100% employee owned company. He is a founding member and Chairman of Pennsylvania Center for Employee Ownership (PaCEO), and spends time speaking about ESOPs to other CEOs at local and national events. He is a Member of the Foundation board of Montgomery County Community College. Ken is also a generous contributor to local and national charities.   Interview Quotes: 11:54  - “In the ESOP world, we all know that one of the really attractive things about ESOPs, particularly from a tax perspective, is that companies what are S-corporations that sponsor and ESOP have an S-corporation shareholder that doesn’t pay any taxes.” - Jim 19:45  - “You need a sophisticated seller and a sophisticated buyer and, as I said, in each situation there are at least some tax analysis risk to be discussed.” - Jim 29:28  - “‘I built a team but it’s a team that supports me rather than can replace me. I’m not a great ESOP candidate.’” - Jim 37:50  - “‘Gee, do you want to talk to us about selling? These are the things you have to do…’  You can make severe enough obstacles to discourage all but the absolutely intent and intrepid. Before we share information, we want to see your information first.” - Jim 43:06  - “There is a lack of successor managment available. Either the founder has stayed on and has never really managed to find a good successor. Or the successor management has done well but thy have not really found their next generations of management.” - Jim 57:45  - “I remember saying to myself, if I ever get control of this company, I’m going to do an ESOP because that seemed like the best business model ever.” - Ken 01:12:38  - “That’s actually an interesting topic that I’ve been exploring, which is the link between employee ownership and the continued process improvement within a company.” - Ken 01:17:49  - “We have a lot of meetings. We have quarterly meetings, and then when there is big changes in the organization, we have town hall meetings. Communicate. Communicate. Communicate.” - Ken 01:21:32  - “You really have to tug on the heartstrings and make sure they understand that what we’re doing is very very important and if we’re not doing it, who’s going to do it?” - Ken   Links and Resources: Jim Steiker sesesop.com James’ email: jgs@sesesop.com 215-508-5643 Ken Baker Newageindustries Linkedin   Arkona Website The 5 Intentional Growth™ Principles (5 Videos to Help Clarify Your Vision) Intentional Growth™ Financial Assessment Fractional CFO Services   You can also reach out to me via email at rtansom@arkona.io, or on my LinkedIn.

Ep.#11 [THEME FIVE]   As we continue down this ESOP mini-series, we want to do some serious myth-busting by diving even deeper into the technical details on how ESOPs work.    This two-part episode is all about deal structures, 1042 tax deferrals (similar to 1031 exchanges), seller’s potential to capture future equity growth via the form of warrants (similar to rolled equity), how to handle key executive compensation plans, and the shareholder benefits of transforming a company into an ESOP.   In this episode, you will learn how an ESOP offers great tax benefits and how you can prepare to maximize your tax deductions before switching to an ESOP. Also in this episode, you will learn about the interview process from a trustee’s standpoint and about warrant options to ensure that the best interest of the employees are at the forefront of the deal without screwing over the primary seller.   In part one of this episode, Keith Apton, the managing director of UBS’s ESOP Capital Group, talks about some false narratives with ESOPs, such as, “If I sell to an ESOP, I won’t get as much cash for my business.” He then talks about the 1042 tax code and discusses how converting the business from an S Corp to a C Corp could defer the gains at the time of the transaction and potentially indefinitely through estate planning. Keith tees up the topic of warrants and how they act as a form of rolled equity that can be as lucrative as the rolled equity in a private equity sale–except in an ESOP sale, the owner still has control over the direction of the company. Keith finishes this segment of the episode by sharing a story of what he thinks would change if S Corps had the same tax benefits as C Corps.   In part two of this episode, Miguel Paredes, president of Prudent Fiduciary Services, is a trustee and shares stories about how a trustee keeps the employees’ best interests in mind without screwing over the seller, and even more so, being a partner that can help everyone get what they want out of the business during the transaction, and most importantly, in the future.   Miguel goes deep into the mechanics of how warrants and SARs (stock appreciation rights) plans can be used to reward key executives with additional future equity based on the value they help create. He explains how exponential growth can happen when warrants for the seller are combined with SAR plans of the key executives and aligned with all the employees' incentives to grow the equity value of the company for their ESOP account.    // WATCH THE INTERVIEW ON YOUTUBE: Intentional Growth™ Podcast   What You Will Learn   Part 1:   How ESOP valuations compare to a strategic buyer. Various deal structures where an ESOP could potentially put more net proceeds into your bank account over the buyout period compared to a strategic buyer. How the 1042 tax code works, why it is similar to a 1031 exchange, and when it can be used. Why changing from an S Corp to a C Corp could potentially defer, if not eliminate, most taxes in the sale of a company to an ESOP. What Keith thinks would happen to the creation of ESOPs if the 1042 treatment was extended to S Corps to use. What having good advisors can do to your ESOP sale process and net proceeds. How warrants work, how they can resemble rolled equity like a private equity firm, and why they exist as part of the deal structure.   How the seller’s note works in an ESOP, why it typically equals mezzanine financial rates, and what that means to the seller’s net proceeds.   Part 2:   Why Miguel made the switch from the DOL to working as a trustee and building a company that helps ESOPs. When and how equity options outside the normal ESOP allocation are available for key management.  A detailed account of how warrants work and why they are used. How warrants can act as an incentive plan that aligns the seller, key executives, and future growth of the company. How synthetic equity plans (also known as stock appreciation rights [SAR]) can be used for current–and future–key executives. The difference between retention SAR plans and incentive SAR plans.  Selling to an ESOP is a very hands-on transition, and a good trustee should let the owner stay very involved. Why an ESOP trustee is more concerned about the financials than operational due diligence when compared to a strategic buyer.   // USE YOUR FINANCIALS TO CLARIFY A PATH TOWARDS A MORE VALUABLE BUSINESS: Intentional Growth Financial Assessment   Bio: Keith Apton: Keith has over 21 years of experience in the financial services industry, with an extensive background in corporate finance with entrepreneurs and business owners. As the founding partner, he heads the team's Private Wealth practice, where he works to determine client needs and match them with the proper resources of UBS, a leading global bank. Keith focuses on solutions encompassing asset allocation, as well as wealth and liability management to create tailored financial plans for his clients. His process entails a disciplined approach to help business owners with sell-side advisory solutions and post-sale financial planning to include holistic wealth management, including tax and estate planning strategies through strategic partnerships. Keith is a nationally recognized leader on ESOPs and Internal Revenue Code §1042 rollovers. Keith has been a member of UBS’s Pinnacle Council since 2018, which consists of the top 2 percent of advisors nationally at UBS. As an active member in the ESOP community, Keith's total participation in ESOP transactions has exceeded $3.5 billion in transaction value across various sectors and industries. Additionally, Keith frequently speaks at national conferences on topics including ESOPs, §1042 rollovers and business succession planning.   Miguel Paredes: Miguel Paredes is president and founder of Prudent Fiduciary Services. Mr. Paredes holds a Bachelor of Science degree in Business Administration from California State University, San Marcos and a Master of Business Administration degree from the University of Massachusetts, Amherst, Isenberg School of Management. Mr. Paredes holds the Certified Plan Fiduciary Advisor and Certified Internal Auditor designations. Prior to establishing Prudent Fiduciary Services, Mr. Paredes had a distinguished 12-year career as an employee benefit plan investigator and supervisor with the U.S. Department of Labor, Employee Benefits Security Administration (EBSA).  During his time with EBSA, Mr. Paredes conducted and supervised several hundred investigations of ERISA-covered retirement plans, health and welfare plans, and plan service providers, with a focus on Employee Stock Ownership Plans and other investigations involving complex financial issues.   Steve Storkan: As executive director of the Employee Ownership Expansion Network (EOeX) (www.eoex.org), it is Steve’s job to implement the mission of the EOeX of significantly expanding employee ownership through establishing and supporting independent non-profit State Centers for Employee Ownership. It is the goal of the EOX to have 70 percent of the U.S. population living in a state that has a state center by 2025, which they hope will create one million or more new employee owners.   Interview Quotes: 10:16 - “But complexity should not be a reason not to do a transaction because complexity just means it’s something new.” - Keith 11:14 - “If the client can repeat back everything that you’ve just explained to them, then you’ve done your job. That means they fully understand it.” - Keith 14:45  - “[With an ESOP] the myth is that the transactional costs are greater than an outright sale. You have more professionals involved. But, looking at it side-by-side, it’s going to be equal to, if not lower.” - Keith 17:43  - “Is the ESOP going to net the client more cash in the pocket than an outright sale?” - Keith 23:57  - “You have to have fire in the belly to want to continue to work, to protect the profits because if the company doesn’t remain profitable, all the excel work that we do and the financial modeling of that waterfall, it means nothing because you’re never going to get the back-end of the money.” - Keith 52:21  - “[A benefit to ESOPs is] being able to keep what you’ve built. Keep that culture and have your employees not only build on what may already be a great culture but take it to a whole new level now that you’re becoming employee-owned.” - Miguel 54:00  - “A trustee should not be involved in the strategic decisions.” - Miguel 01:05:32  - “The value that the seller gets is the difference between the initial strike price and the growth of that equity value in the company over time, and the payout at the end of that warrant term for the difference between that initial strike price and the equity value of the strike price at maturity.” - Miguel   Links and Resources: Keith Apton Connect with Keith on LinkedIn! Miguel Paredes Fiduciary services   Arkona Website The 5 Intentional Growth™ Principles (5 Videos to Help Clarify Your Vision) Intentional Growth™ Financial Assessment Fractional CFO Services   You can also reach out to me via email at rtansom@arkona.io, or on my LinkedIn.

Ep.10 [THEME FIVE]   In part two of our four-part ESOP series, we dive deep into the mechanical and legal relationship between you (the owner), the ESOP trust, the trustee, and the employees.   We cover the role of a trustee in depth as well as more technical nuances about the legal structure of the trust, how the trust is managed, and when and how employees get their shares.   In part one of this episode, Neil Brozen, a trustee who has been responsible for more than 300 ESOP transactions since 2005, talks about the role a trustee plays in an ESOP during the transaction as well as the ongoing management after the deal is done. Neil explains how the business owner gets to interview and select the trustee (the buyer) and what it’s like to negotiate the purchase of the business from the perspective of the trustee. Neil then shares the trustee’s involvement–and control–on an ongoing basis (which is much less involved than most people think), what rights the employees have, and why the company doesn’t turn into a “consensus-based” business after becoming an ESOP.   In part two, we have David Solomon, a corporate M&A and ESOP attorney, who has been working in the ESOP space for many years. David walks us through the technical and legal journey a business owner goes through in order to set up an ESOP, such as what goes into the legal document of the trust, how company stock is allocated to employees, the ongoing involvement of advisors to manage the ESOP trust, and the one very important differentiator between an ESOP sale and an M&A sale.  This episode is a deeper technical dive into ESOPs and answers questions many business owners have like, “who am I selling my company to and what will they do with my company?”; “what are the real benefits to my employees if I sell to an ESOP?”; and “what is it like to lead and what control do I have as a CEO after the transaction?”   // WATCH THE INTERVIEW ON YOUTUBE: Intentional Growth™ Podcast   What You Will Learn Part 1   The role of a trustee during the transaction in an ESOP. Why the trustee is the buyer that represents the ESOP and future employee shareholders. The engagement between a trustee and seller (business owner). What the process is like to pick a trustee.  Who makes up the board of advisors in an ESOP and how they are chosen. The ongoing involvement of the trustee after the transaction. How decisions get made on the board. What happens if management and the board and the trustee don't agree. What authority–and rights–employees have when a company is an ESOP. Why a trustee is needed even though they have a fairly passive role. What happens if a company that is an ESOP becomes stagnant and whose job it is to step up and fix the problems. What happens if an out-of-the-blue offer comes and someone wants to buy the ESOP.   Part 2   Role of legal counsel on both the buy and sell side of an ESOP transaction The similarities of managing an ESOP and managing a company benefit plan How the employees get their shares of the ESOP (cliff vs gradual) and the flexibility you have depending on your industry and type of work force.  How employees get shares if they don’t have to use any of their own money When and how employees get their equity when they leave The correlation between annual compensation and vesting What a repurchase liability is Role of ERISA, the DOL, and legal counsel on an ongoing basis The facts - and myths - around ESOPs “needing to sell” because they have too many people that need to be bought out. Why it’s a good idea to work with a business lawyer that understands business financials. The difference between a business lawyer’s role on the buy side vs. the sale side. The insides of the legal work and oversight of an ESOP trust. What someone can expect in ongoing costs and time when managing an ESOP on an annual basis   // USE YOUR FINANCIALS TO CLARIFY A PATH TOWARDS A MORE VALUABLE BUSINESS: Intentional Growth Financial Assessment   Bio: David Solomon: Upon joining Levenfeld Pearlstein in 2009, David founded and currently serves as the head of the firm’s Employee Stock Ownership Plan (ESOP) practice, which serves clients who are involved in various types of transactions involving ESOPs. In addition to working on ESOP transactions and advising ESOP companies, he lectures frequently on ESOPs and has published articles in various publications about how ESOPs are an effective business succession strategy. David is also a member of the board of directors of two ESOP-owned companies and was a former member of the board of directors of the National Center For Employee Ownership (NCEO) and formerly served as the executive vice president of the Illinois Chapter of the ESOP Association. Neil M. Brozen: Neil co-founded Ventura with Mary Wertz in July of 2016 after providing ESOP trustee services for two institutional trustees from 2005 through April of 2016. The key to Neil’s success in providing ESOP trustee services is his dedication to providing outstanding service, his intentional and sincere building of relationships as well as his common-sense approach to problem solving. He has been a CPA since 1981. Steve Storkan: As executive director of the Employee Ownership Expansion Network (EOeX) (www.eoex.org), it is Steve’s job to implement the mission of the EOeX of significantly expanding employee ownership through establishing and supporting independent non-profit State Centers for Employee Ownership. It is the goal of the EOeX to have 70 percent of the U.S. population living in a state that has a state center by 2025, which they hope will create one million or more new employee owners.   Interview Quotes: 03:14 - “Everybody always talks about ESOPs being complicated and complex but, hopefully through Neil and David’s segments, you’ll realize that it’s really only building a good company that has good, healthy cash flow, good financials and strategies, and good governance.” - Ryan 12:00  - “[Being a trustee] essentially means I’m looking out on behalf of other people’s interests.” - Neil 12:38  - “ESOP companies get sold, just like any other business, for a lot of different reasons. And that is the second major category of transactions that we do. And transactions are essentially a limited term engagement with a specific purpose.” - Neil 20:34  - “In an ESOP transaction, the seller typically puts out the first offer.” - Neil 28:34  - “You’ve got a businessowner who hasn’t worked for anyone for a number of years and they fear a loss of control–which is absolutely not true, but that’s what they fear. And that might be why they have an internal trustee, because the internal trustee works for them.” - Steve 56:29  - “When you’re thinking of doing this journey called an ESOP, you’re not just selling your company, you’re also creating a new benefit plan for your employees.” - David 01:06:14  - “Most companies have a some sort of retirement plan… So that’s pretty common this day and age. And it could look like a 401(k) plan or a simple IRA. [It’s] some sort of employer funded retirement benefit is relatively normal these days.” - David 01:08:42  - “The ESOP is an acronym for Employee Stock Ownership Plan. The main investment in an ESOP is stock in the company and these companies are mostly (but not always) privately held businesses where you can’t go on the street corner and buy and sell the stock.” - David 01:10:41  - “The stock inside the ESOP is owned by the trust, not by the individual employees.” - David   Links and Resources: Ventura ESOP Neil Brozen’s email: nbrozen@venturaesop.com LP Legal David Solomon on Linkedin Steve Storkan’s email: sstorkan@eoxnetwork.org EOX Network   Arkona Website The 5 Intentional Growth™ Principles (5 Videos to Help Clarify Your Vision) Intentional Growth™ Financial Assessment Fractional CFO Services   You can also reach out to me via email at rtansom@arkona.io, or on my LinkedIn.