#355 – Time to Start Thinking About Exiting Right NOW – Here’s $$$$$$$ Why
In episode 355 of the AM/PM Podcast, Kevin and Scott discuss:
- 01:17 – The Man Behind The Biggest Exits In The Amazon Space
- 02:03 – Scott’s Brief Backstory
- 06:25 – From Amazon Seller To Guiding Sellers For Premium Exits
- 07:38 – 50% Of The Money You’ll Make In A Business Is When You Exit
- 08:22 – Why Do You Want To Exit A Business If You’re Making Money?
- 11:00 – Planning Your Business’ Exit From Day 1
- 16:27 – The “Return Of Your Time” Metric
- 19:56 – Gross Margin Profit, Gross Profit, Net Profit, Contribution Margins, SDE, and More!
- 23:00 – Pro Tip: Variable Profit And Contribution Margins
- 26:06 – Understanding Valuation For A Physical Goods Company
- 30:34 – Understanding Valuation For Agencies And Software Companies
- 33:55 – How Valuable Is An Omnichannel E-commerce Business
- 35:56 – The Concept Of Diversification Of Risk
- 37:42 – When Is The Right Time To Sell My Company?
- 43:37 – Watch Out For The Next Generation Of Aggregator Buyers
- 46:53 – Is It The Right Time To Make An Exit?
- 49:32 – Why Should You Hire A Broker For Your Exits?
- 55:49 – Talking About The Exit Ticket Course Inside Helium 10
- 58:01 – Join Kevin And Scott For The Billion Dollar Exit Summit In October
- 01:01:02 – How To Get In Touch With Scott Deetz And The Northbound Group
- 01:03:40 – A Golden Nugget Tip From Kevin King
Transcript
Kevin King:
Welcome to episode 355 of the AM/PM Podcast. This week, my guest is Scott Deetz. Scott is probably the premier expert in this business when it comes to exiting your business, and he’s someone that I have very high respect for and really knows what he’s doing when it comes to maximizing value. And as he likes to say, 50% or more of all the money you ever make in your business will come when you sell your business, not when you’re running your business. And today, we’re gonna be talking about a lot of things that are happening in the exit space, and some things you need to be thinking about and why right now it’s actually a pretty good time to sell. Enjoy this episode. Scott Deetz. Welcome to the AM p m podcast. It’s my honor to have you here.
Scott:
Hey same as well, Kevin. Look forward to talking with you.
Kevin King:
Now, for those of you that don’t know, Scott, Scott is probably one of these sharpest minds and the busiest people in this business. This guy’s schedule is insane because he’s, he’s the guy that’s behind a lot of the biggest exits in this business. And if you’re wondering, exit, what do you mean you quit and you give up? No, it’s exiting for lots of money when you sell your business, and that’s what Scott’s specialty is. And we’re going to dive into that and how that landscape has evolved and changed. But first Scott let, let’s talk a little bit about how you got to this point. You’re an entrepreneur by trade, right? Before you actually started doing this, you built a business and sold, had a big exit yourself. And can you kind of just tell us some of your backstory of how you, how you got into this entrepreneurial journey?
Scott:
Yeah, absolutely. So, hello everybody. Yes. I, I’ve been an entrepreneur literally since age 18. My background, I went into my father’s software company. And so I got some you know school of hard knocks there. But after graduating college and going full-time into that ran that business, and I kind of took over the company and then had my first exit, as you said. And interestingly enough, why I do what I do today, helping other people is directly as a result of that I tried to do the exit myself. I, I put a, I had a deal on the table for some life-changing money. And the deal fell through and I got really depressed. And I got really depressed. ’cause What I realized was I didn’t know what I was doing <laugh>. I thought because I could run a company, I knew how to sell a company. And, and it turns out I, I didn’t at all. But that allowed me to meet my mentor a guy named Terry. And within 18 months, we took the same company back out to the market, and we got more than three times the price than I got offered on my own. Were you
Kevin King:
Looking to sell this business or did someone just approach you to buy it?
Scott:
We were looking to sell we were doing the classic family buyout where you know, the kids are buying out the dad type of a scenario. And and it just became obvious that we should really look at some other options. And somebody approached us the first time that’s, you know, that was that first one that fell through. But when that fell through, it really sparked me to say, I need to bring in a mentor. I need to learn how to do this right. Because I, obviously, I had the pain of doing it wrong. And then we proactively went out to the market, which was one of the biggest lessons of why the, the valuation changed so much as we finally got in front of the right buyers, rather than the buyers that approached us, which has been a key life lesson for me.
Kevin King:
Was this software, was it aimed at helping businesses like automation software? Was it more aimed at consumers or was it like a SaaS product, or what type of Yeah. Software was it, it was,
Scott:
It was B two B software in the insurance in and financial services industry. So I found Amazon you know, much after that. In 2013, I was a part of ASM2 and I just wanted to get away from the business to business side. I wanted to work more on the consumer side. So I started up my own Amazon company. And you know, apologies to people that running Amazon businesses now, they were absolutely much simpler to make a lot of money back then. Because you know, there was you know, sort of not as many rules you could you know, do a lot of different things that you don’t do today. And but I realized my passion is really in helping people not in picking products.
Scott:
And so I met a guy that many people know in the industry named Ezra Firestone. I showed him some financial models that I had built regarding valuing companies and he said, Scott, you know, this stuff is really fascinating. I think you should quit your job running an Amazon business and help other people exit, because I was showing him the first versions of how you maximize the value of your company. And I, that was either a commentary on how much he thought of the information I put together, or maybe how poorly he thought I was at running an Amazon business, <laugh>. But either way it was a very great experience. And shortly thereafter, I started northbound group dedicated specifically to helping e-commerce entrepreneurs achieve premium exits. That was the, the mi it still is the mission of the company.
Kevin King:
And when northbound started, I seem to remember, I mean, I think I first heard about you guys before anybody was talking about exits. This is like 2015, 2016, maybe somewhere in that neighborhood. And I remember it was more of like a, y’all were teaching stuff. You had a couple other partners or something at the time, and it was more like it was the way I saw it back then. I didn’t realize it was exit stuff. I thought it was more like teaching like, you know, courses and how to, how to succeed on Amazon. And, and was that the Yeah. Part of the initial plan then you kind of devi said, you know, let’s, let’s actually double down on this exit stuff, or how did that evolve?
Scott:
Yeah, no, it evolved this way. When I originally started thinking, this is long before aggregators when I originally started thinking about helping people exit, I realized a critical thing was that most Amazon sellers at the time, and, and, and probably a lot of people would argue the same thing today, they’re, they weren’t ready for exit. And, and so what, what I’ve always had in my passion center is to not only help people with the exit, but actually help people with the process of getting really valuable before you exit. And so, you’re right, that initial version of it had a lot more content around, here’s what you need to do to grow an Amazon business. Here’s what you need to do to have accurate financials in your business. And over the years, what happened is that a lot of other programs came out with more of what I’d call the growth content.
Scott:
You know you know, everything on up into Freedom Ticket and all the things that you do that the need for me to be involved in that wasn’t as much. And that the real niche is serving the financial end of it, the legal end of it, the what we call corporate development. How do you scale a company and develop the company and the exit side. But always, my vision has been on the exit because the, the, the simple reality, you know, if you ever listen to me talk the first slide I always show is that more than half of the money you’ll ever make as an entrepreneur comes from when you exit, not the entire lifetime that you’re running the company. So in other words, if you never exit you’ll leave more than half of the money. It’ll never make it to you personally, because you’re always putting it back into inventory. You’re always investing in staff. And, and these businesses that are physical goods businesses are very cashflow needy. And so you tend to get your cash out upon the exit. So it’s a very important thing for every seller to think about.
Kevin King:
And that’s something people always say is that, Kevin why would you, why would you want to exit your business if you’re making money? If I’m growing my business I wanna leave this as a legacy to my children, or I wanna, I don’t, I don’t want to exit the business. But when you paint those, you show that slide. I’ve seen that in presentations you’ve done, and it actually makes you stop in things like, you’re right. You know, maybe I’m doing a, just to make the math easy, a million dollars in gross sales on Amazon, and I’ve got a 20% profit margin. And people think you’re, you’re driving Lamborghinis and, and living high on the hog. But the truth is, you’re probably not making much money and putting much money in your pocket at all because most of that $200,000, you’re having to roll back in and like you said, buy more inventory, get ahead of things put into the growth.
Kevin King:
And so you’re still living on ramen noodles a lot of times, even at a million dollars. A lot of people don’t realize that. But if you can leverage that, and some of the best leverage like real estate in a way, you know, you can leverage and take, someone will come in and give you a multiple of that 200,000 that’s, you know, 2, 3, 4, 5 x depends on, you know, the buyer and the market conditions and stuff. But you can walk away with half a million or a million bucks cash, almost most of that in cash. And some of it might be deferred, but most of that in cash in your pocket, that that’s real money that you can then take, pay off some bills, have a nice vacation set some aside for the kids college, whatever, and then start something else.
Kevin King:
And you’re starting from a much better point. And I know people I don’t know if you know David Cups. And, you know, that’s basically what he does. He did. I don’t know how many businesses he’s on now that he’s sold four or five, maybe more. But he started with one. He and his wife built it up, sold it for like, I think three or $4 million, took a bunch of that money reinvested in another Amazon business, did it again, sold that one for, I forget the number seven or eight 10 million, something like that. And then did it again, sold it for 13, 15 million. It’s that leverage. And every time he’s just, that’s way more money in a short amount of time in a seven or eight year period that he put in his pocket, you know, probably 20 million plus if he was, would’ve kept running that same business and was running it now, I’m sure it would’ve grown and would’ve been thrown off some more money, but probably not $20 million in his pocket.
Kevin King:
So that’s something that a lot of people need to think about, and that’s something that you show people. And then I changed, like the Freedom Ticket. You know, the first Freedom Ticket came out in 2017, and we didn’t really talk about exits in that at all. And then I saw one of your presenta, you came on think the Illuminati, the Helium 10 Elite and you made a presentation. And I remember after that presentation mark and I mean Manny and Gee’s attitude towards everything completely changed. They’re like wait a second. Our thought process on building Helium 10 needs to change. And they got serious about looking to exit. And so then I started looking at what you said, and I was like, and the next freedom ticket, we actually said, you should build the company from the ground up with the intent to exit, because that’s where the real money is.
Kevin King:
And a lot of people don’t think of it that way. And even, you know, with one of my companies that we came to you, me and the partners a few years ago, and we said, Hey, we, we wanna build this company to exit, rather than hiring someone like you guys to come in at the last minute and help us out and, and organize everything, set everything straight. It’s like, let’s start with someone like yourself from day one. And so you guys, we, you know, we engaged you Northbound from day one to come in and get, make sure all the operating agreements are set up correctly, make sure everything is set up correctly, make sure all the forecast, and like you said, these spreadsheets, you blew, blew the my partners away, these complicated spreadsheets that you know, we couldn’t even figure out how to, to operate them that would show you all this cash flow and everything that you need to do to maximize this. And that’s just something that most people don’t think about and they can’t get their head, head around. And it’s, it’s a need for someone like yourself that comes in and does that for people.
Scott:
Yeah. No, I think about, you know, there’s a couple things I think are really important. First is, I always like to say, if you are not exiting to someone else, then you better be thinking of exiting to yourself. And, and what I mean by that is getting the right funding into the company to fund what’s called the networking capital or your inventory payments so that you as an owner can essentially sell the business to yourself and get cash out of the business. And, and, and the analogy I make, I’ll use that, that m million dollar revenue company you mentioned. So let’s just put a multiple on that 200,000 and say that it’s a 3x or a 4x multiple, it’s worth between six and 800,000. Okay? so the, the question I always ask people is, if you don’t have any other money stored away and you had one stock that was worth $800,000, would you keep it all in one stock?
Scott:
Or would you diversify it into a mutual fund? And most of the time, people will go, I’ll even say, what if it was, would you, you know, if you had $800,000 in the market right now today, would you have all 800,000 in stock and Amazon, or in stock and Apple? And most people would say, no, I would diversify my stocks. Exiting is simply the same thing. You have to look at your business asset as a part of your overall net worth as an owner, and at some point you wanna make a decision about how do I diversify money away from my business and into my personal net worth? And exiting to another person is one way to do it. But if you’re not exiting to another person, you better be thinking about at least diversifying that stock and not constantly running it you know, break even on a cash basis and not being able to take any money out of the company.
Scott:
So that’s the first point that I’d love to make about, is that in my mind, everybody should be thinking about exit. And when you do, that brings up your second point, which I think is a really great point, which is the concept that the way you run a business is different if you know that you want to exit it someday than if you don’t. And I’ll look no forward than what products that you actually pick to exit. There are certain businesses that are very difficult to exit compared to others. So if, if you think about it, you might pick your first business by what you’re passionate about. And I’m not gonna pick on any, any category that I pick. Someone is gonna say, well, oh, no, Scott said on this podcast, you know that you shouldn’t be in this business, and I’m in this business, and that’s not my intent, so please, out there, nobody take this.
Scott:
But businesses that have very large numbers of skews compared to revenue are harder to exit than those that don’t. So if I happen to be in you know, apparel and I have 500-600 SKUs, that is more work to maintain than if I’m in something else. And so that’s a concern that buyers have. Another concern might be if I’m in something that’s very highly seasonal, so if I have 80% of my revenue comes in in, you know, November you know, black Friday through the end of the year, well, that’s harder to plan inventory for. So each business has these different types of things that you can exit and still get an exit, but you want to be thinking about what systems you need to design in order to design the right exit for those types of businesses. And it might cause you to even decide to get into a different business altogether.
Kevin King:
Yeah I agree with that. I mean, I, even on my product, have a rule. I don’t like to have over about 20 products. And, and, and I, I treat my products like stocks. So I’ll have a product, and it may even be profitable, but if it’s not throwing off at least $3,000 a month after six months, I drop that product and I like, I can deploy that capital in another way. And some people would say, Kevin, that’s stupid. That’s $3,000. It’s easy money. And I’m like, yeah, but I don’t wanna manage 500 products. I don’t want to have those headaches and have to hire additional people to manage that in different systems and just let’s focus on 15 or 20 core things, and that should be good enough. But some people will say, but yeah, then you’re spreading yourself too thin, because I’m sure you may see this a lot of times in the people you work with. It’s that old 80 20 rule where 20% of the products are making 80% of the revenue. And so how, what, what do you recommend to actually try to, is that just accept that, or is that something people should work to actually try to level that out a little bit to help them in an exit, whether it’s to themselves or to somebody else?
Scott:
Yeah, so the first thing that I think about is the return on your time is the most, you know, one of the most critical and underestimated parts of any Amazon or e-commerce entrepreneur, because most of us tend to be smaller organizations, solopreneurs, maybe one partner, maybe a few vass, maybe some staff, but even the larger sellers, you know, you know, typically will have under 25 employees. So, you know, the return on the executive’s time is absolutely critical. And, and as I always say, everybody calculates ROI, but nobody calculates ROT. And if your ROT is bad, you literally are rotting. So, you know, I like the concept of, oh, what is the return on my time? So the, when you, when every time when we go and look at a business, what I generally see that happens is there’s actually three businesses operating within everybody’s business.
Scott:
And I’ll describe what I mean. Someone will come to us and they’ll say, we’re making 12% and we want to be making 15%, and we can’t figure out why we’re not. And what we’ll do is we’ll have our team go in and do a deep analysis of the business, and we’ll find that there are actually mature products that I would label green that are making 20 to 25% money and doing really, really well. And they tend to be ranking pretty good and, and they’re profitable. Okay? Then there’s mature products that are in either the yellow or the red zone, which means that you’ve had ’em for longer than nine months on the marketplace, or six months on the marketplace. They’ve kind of become what they are. And maybe you’re in the ranking wars where the only way that you can get ’em up the rank is if you drop the price and you’re kind of fighting with a profitability scenario.
Scott:
And that’s the second company that’s inside your company. And then the third company that’s inside your company is the innovation part of your company. And that is all of the new products that are coming out into the marketplace, which generally have lower margins because you’re trying to pay more in P P C to get up ranked. And maybe those are, you know, only making zero to 10%, but it’s because they’re new. And what most sellers don’t have is they don’t have a visualization of their company across that dynamic. Because if I’ve got a product that’s making 12%, but I’ve had it for a year and a half, that’s very different than a product that’s only making 12% that I’ve only had four months. And so you have to look at your business in a much more sophisticated way, and in essence, sort out the business and then apply a valuation multiple to each part of that business.
Scott:
And then the decision of where to spend your time becomes much clearer because now you can go, wow, you know, that product, that’s only 8%. I’m a profit. I’m gonna either get it profitable or get it out of the way so that I can focus more of my time on the greens that are going well and on the new entrant that I think are gonna become the greens and get rid of that sticky stuff in the middle. That, that just isn’t really adding a lot of value, but sucking up a lot of your time. Does that make sense? Makes
Kevin King:
Sense. That makes total sense. And I agree a hundred percent with that, and that’s kind of what I in a way, I do, but for those listening when you keep talking about profit, let’s just for those that I think that word gets people misunderstand what the word profit actually is. You know, I hear people say, oh, we have a 70% profit margin, you know, on a podcast or something, and I’m like, no, you don’t. Maybe, maybe, you know, there’s the rare exception that, that may have that, but most people, they’re not doing this stuff. Right. Can you explain the difference between gross margin profit, gross profit, net profit and SDE?
Scott:
Yeah, absolutely. So, and I’m gonna explain it for what I’ll call a physical goods company. And I’ll use an Amazon e-commerce company a as an example. We also do quite a bit of work at northbound with software and, and tech enabled service companies. And so those have different metrics to them. So but if you’re a physical goods company and you sell on Amazon, everybody understands what I call gross revenue. That’s the top. Then you subtract out your discounts and returns and you end up at something called net revenue. Okay? and so if I’ve got a hundred dollars of gross revenue and I have 4% returns, I have $96 of net revenue, then the next thing that you separate out, there’s actually what if you had talked with most aggregators, they’ll have what they call CMM one, CMM two, and CMM three.
Scott:
And what that means is contribution margin one, contribution margin two, and contribution margin three. And what contribution margin one is, is you subtract off the Amazon fees. So you say, okay, I owe 15% for the selling commission, and I owe, let’s call it 20% for fulfillment by Amazon. So after Amazon fees on that a hundred dollars take off another $35 for those expenses. And then CM2, you’re subtracting your product costs. So let’s say that your product costs are 25% of your revenue, you’re subtracting another $25. So, and then CM3 is you’re subtracting off your advertising costs. And CM3 is often referred to as contribution margin. And so in a typical Amazon company that your contribution margin you should be shooting for is around 25% or better. And what I mean by that is that if you take your revenue of that a hundred dollars, you take out $35, that’s gotta go to Amazon, you’re down to 65, you take out another $25 that’s gotta go to paying for the product, you’re down to 40%. And if you have to spend 15 per dollars on advertising, you’re down to a 25% contribution margin
Kevin King:
And minus $4 for the returns too. So you’re actually at 21.
Scott:
Yeah. And that’s the, yeah, the $4 for the returns. So so you’re at a 21% contribution margin if you look at all of those different particular expenses. So once you do that, the reason why that number is so important is because that is your variable profit. And what I mean by that is your overhead tends to be more fixed. Your staff that you pay the VAs any money, you pay yourself as a salary, even sort of ongoing types of you know, software and tools, expenses. So when a buyer is looking to buy you, they very much care about the variable profit or the contribution margin, because that is the number that if you double the size of the business, you wanna see that number double. So if I start from that metric that says I have a 21% contribution margin, my goals, no, that
Kevin King:
Doesn’t include, just to be clear, not to interrupt you, but just to be clear, to be, make sure everybody’s understand that 21% is not your final profit, that that 21% still does not include what your, your salaries, your office rent, your overhead, all that that comes out of that. Just, I just wanna make sure that people understand
Scott:
That. Yeah. So now let’s go to that next section and we’ll say, okay, I’m at 21% contribution margin, and if on let’s do it on that million dollar the revenue line item, I’ve got a $210,000 contribution margin. And then let’s just say that for my VAs and my overhead and my software, it costs me another $60,000 a year to run all of that. And if that’s including your salary as well as, you know, that’s not a lot. So that is what’s called your overhead. And if it’s 60,000 and I’m now down to 150,000 on my million, that means I have a 15% net profit, or what a lot of times people will call ebitda, which is essentially your earnings before taxes and interest expense that you have. Okay? So then you go, you asked another question is, what is seller’s discretionary earnings or s D e?
Scott:
And what you get to do with seller’s discretionary earnings is you essentially get to add back any owner related expenses or any expenses that were one time. So again, I’m down to 150,000 but let’s just say I’m paying myself $40,000 a year. I can add back that $40,000 a year, and I can then be saying for the purposes of valuation that I’m making 190,000 rather than 150,000. So SS d e is essentially contribution margin minus all of your overhead. So that gets you to your net profit, like you said before, and then adding back and, and actually increasing the profit for any owner related expenses that you might have. Or one time, if I got in a lawsuit and it was a one-time settlement, you get to add those back and get credit for those.
Kevin King:
And there’s some other little s d e add back you know, tweaks like there, there’s lots, lots of little things that sometimes can add up to, to real money. You know, it could be a conference that you went to or something, or there’s, there’s a number of things that sometimes can be be thrown in there. There’s also a difference in the valuation once you get all these numbers and figure all these out. But isn’t it, if you’re a product based company, it’s, it’s typically a multiple of s d e and if you’re more of a software or especially software company, I’m not sure about service. It’s more of a, a multiple of like a, what’s it a r r or something like something like that.
Scott:
Yes. A revenue, a revenue based valuation. Absolutely. So if I go back to the physical goods company the, the first thing that I would say about valuation that I think is the, the most important thing to understand about valuation, most people think about how you calculate valuation. They don’t think about how you value is created. And, and here, I’ll give you a perfect example of this valuation is oftentimes for a e-commerce business calculated on the trailing 12 months selling seller’s discretionary earnings. So TTMSDE is what it’s called. And so I always often have sellers come up to me and say, buyers don’t buy based on my future profitability of my company, they will only value me based on my historical profits. Is that correct? And my answer to that is that that is absolutely untrue.
Scott:
That is a total myth and makes zero sense whatsoever. I’ll say that again. There’s not one buyer out there that buys your company based on the historical profitability of your company. They don’t value it that way. They calculate it that way. And then people are probably going, well, what do you mean, Scott? What’s the difference between that? The simple way that I answer that is, how many dollars of your historical profitability does the buyer get to keep Kevin? Zero. What you did last year that you, you know you, you spent all that money on, you know, beautiful stakes you know, in Las Vegas, thank you very much, I appreciated mine. You know, all, all of that money is gone. The only money that they get to keep is they get to keep the future profitability of this business divided or, or subtracted from what they paid for that business.
Scott:
So actually, this gets to a very critical way. If you ever wanna maximize the value of your business, the number one thing that you have to do is you have to use an expression, I call, it’s not what the seller is selling, it’s what the buyer is buying. Most sellers think that they’re selling the historical performance of their company, but all the buyer is buying, is their belief of the future performance of the company. Now, they use historicals for two reasons. One is because it’s the one tangible thing that everybody can agree to. Okay? But if I have two businesses doing this million dollars, one of them is growing at a hundred percent a year, and one of them is completely flat, are they gonna be valued the same? And the answer is no, because a buyer’s gonna believe that the growth is gonna continue and that I would much rather buy the faster growing business.
Scott:
So the first reason why they use historical numbers is because it’s something that we can touch. And the second thing is, is if you’re a buyer and all of the companies that you’re buying are growing, does it make more sense to negotiate based on historical numbers or based on future? And the answer is, is if the buyer’s job is to pay as little as possible, it’s easier for them to say, well, you only made $200,000 last year, and the job of you as the seller is to say, but I’m gonna make $400,000 this year. So if you’re gonna pay me $600,000 for a company, but in the next 12 months, I’m gonna make $400,000 anyway, I’m only getting one and a half time my future earnings. Okay? And they’ll come back and say, well, but you’re getting three times historical, and therein lies the heart of the negotiation.
Scott:
But until you start describing your business in the language of a buyer and looking at the future potential to a buyer, you’re literally negotiating blindly. So I think it’s very important for sellers to understand the difference between how a, a, a value might be calculated versus how the actual number is generated. The last analogy I use on that is how you’re calculated is like Fahrenheit versus Celsius, but it doesn’t tell you how hot it’s, you need to know the temperature of the business in terms of how hot it is, which is what is the future value of this company to a buyer?
Kevin King:
That’s where, like you mentioned in the s d e, it’s a multiple, but that’s where, on a software basis, it’s more based on the recurring revenue model. It’s where they, that we know that the lifetime, the average guy stays 8.2 months, and if you have this many subscribers, so it’s more based on that versus an SDE, right?
Scott:
Yeah, absolutely. So now translating that over to the software company, if you think about what the future potential of a software or a tech enabled service company is, it’s the revenue that you generate. And the huge factor in those companies is churn. Because if I have 3000 people using my software and 2000 of them leave every year because I have very high churn, what ends up happening is I gotta go sell 2000 more clients in the future just to stay at my 3000. So in the, in those types of metrics, they’re generally based on revenue, but there’s a really, really key emphasis on what’s called recurring revenue that you can count on. And so for an agency, it might be confirmed contracts you know, 12 months in advance contracts, or it might be, whatever I can demonstrate is re, you know, that happens year after year because again, back to the principle of valuation, the buyer is only able to take home the future performance of the business.
Scott:
So they’re trying to calculate what the future performance of the business is, which is usually the a r r annual recurring revenue or MRR, monthly recurring revenue, but factoring in what do they believe is the net growth rate after churn, and that affects the multiple for those types of businesses. Here is the key thing that everybody on this podcast should take away, is that if you’re only looking at your business based on metrics for running it, you’re missing a key part of the story, which is the metrics that will make you more valuable. And so once you start using valuation as one of your key guides in terms of how you run the company, you start to run the company differently. And I’ll give you a perfect example is that in a Amazon e-commerce company, once I know that I need to have 25% contribution margin or better to try and exit a company for a premium multiple, then I start to get rid of the things that aren’t as profitable.
Scott:
And a lot of people, for example, would say, oh, I wanted to diversify into Europe, and I went into Spain and Italy because I wanted to show a buyer, or I wanted to show that I’m on two continents and, and, and I’m, and I’m really diversified. And then we go in and dig into the numbers. And after you look at the 21% VAT cost, and after you look at the price that you can charge in certain countries, you realize that that profitability is actually dragging down the overall profitability of the company. And once you drag down the profitability of the company, it’s not like you’re just making less money, but you get a lower multiple. So it’s almost like the insult to the injury. So I, I call it the five for one rule, which is that every dollar of profitability is worth the dollar that you get, but the multiple you get on that dollar is another $4.
Scott:
If you get a four multiple. So everything that you do in your company, you should think with a five for one mentality. So for example, you’ve got who here has bought a piece of software that they’re not using, and they spent $2,000 last year on a piece of software that they never got up and running. They think, oh, I lost two grand. It’s like, no, you lost $10,000 because you lost the multiple on that. So I think that in terms of spending to acquire a customer, you what you said, customer acquisition costs, you’re absolutely right. If we find that we can afford to spend more to acquire a customer in a SaaS company, we’re gonna do that because the metrics are making us more valuable every time that we do it. And conversely, there’s a percentage in it, let’s call it a physical goods company, that I can’t afford to spend 17% of my revenue to acquire a new customer with all my other Amazon and my other e-commerce fees. I have to keep it at 14% to 15%. And what essentially, you know, a lot of what I like to think that we do at northbound is we’re not magicians. We’re just really, we’re taking off the fuzzy glasses and giving you a clear view of your business as a buyer is going to see it. And once you see it that way, you make better decisions for running the company, that that’s what makes you more valuable.
Kevin King:
A lot of people say that they need to diversify off of Amazon to make their company more value. They need to be on Walmart, or like your example, they need to go to Europe. And as you just point out, sometimes that doesn’t, that doesn’t make sense, like it should pull back. But what’s your thoughts or what are you seeing out there among buyers? Do they like you to be diversified or do they prefer is it just it depends or do they prefer like, you know, you’re really double down on maybe one or maybe two markets and and that’s good? Or what are you seeing? What would you recommend to someone out there now? Should they pull back if they’ve expanded too much? Or should they, if they’re only in one marketplace, should they be looking at ex extending?
Scott:
Sure. two ways to think about it. Number one, always remember, if you are not diversified, that doesn’t mean that your buyer still could be diversified. So for example, if I’ve got five SKUs in you know, in, you know, pet supplements, but I go sell to a buyer that has 50 SKUs already in pet supplements, they’re what’s called a strategic buyer. They can afford to pay more because they don’t have the risk if any of those go down then somebody that’s for the first time getting into it. So the first thing to always think about is diversification is in the eye of the beholder and is somewhat buyer specific. But in general, what you’re asking about diversification is diversification of risk. And the bet the metric that I like to use to some people is most people tried to diversify just for the sake of saying that they were diversified.
Scott:
But to a buyer is if you bring up, let’s call it a, a, a whole Facebook strategy to go direct to, you know, D two C e-commerce, and it’s still less than 10% of your revenue, it’s a distraction, not a diversification. So generally you want each one of your diversifying activities to be 10% or more of your particular strategy. So for example, if I am in the United States and then I’m also in the uk and the UK is 3% of my revenue, it’s fine that you tried it, but if it’s not really gonna work out, you’re spending a lot of time for only an extra 3% of your revenue. A buyer might look at it and say, you know what? The UK market doesn’t really like this product set. I’m just gonna focus on on the us Okay?
Scott:
The flip side is you look at Canada where it’s all under one marketplace platform, you know, and if you have five to 10% of your revenue in Canada and it’s all still in one area, that would be diversification, not distraction. And so I use the 10% rule, if it’s D2C, I like it to actually be higher. I like your D2C to be 20% or, or, you know, if you can get to that level to, because there’s more work in running a D2C strategy than just adding another Amazon marketplace. Does that make sense?
Kevin King:
That makes total sense. What about people? Sometimes when’s the right time to sell? You know, some people say, man, I, I sold too early. If I would just would’ve held it another year, I could’ve made twice as much. Or other people wait too long and they end up making less. Is there a right time to sell or is it when you’re always on the rise up or when you’ve leveled off? Or in some cases, depending on the buyer, they might buy be more, you might be more attractive when you’re on the way down. What, what are some of the general I know it depends, but what are some of the general rules around when’s the right time to sell?
Scott:
Yeah, so the first simplistic way that I always say to people, ’cause the very common question that I get asked, Hey, Scott, I’m growing and I’m making more money. You know, now’s the wrong time to sell. And and my answer back to that is always this, there’s generally two times when you can sell your company. One is when it’s going well, and two is when it’s not going well and there’s no buyers, which, which brings you back to number one, right? So on some level you’re selling during a period that it’s going well, okay? But now you have to decide when during that period of it going, well, do I want to exit? So I think it’s very important for people to get rid of, you know, the mental block of it’s going well, therefore I shouldn’t sell.
Scott:
And the answer is, the only time that you’re gonna be able to sell most likely and get a number that you feel good about is on somewhere along the curve of when it is going well. Okay? So now that we’ve kind of shifted to, to, to think about it, I call it in the right framework, then there, in order to figure out when during the right time of selling, well, what do I need to do? I need to be able to forecast how long it’s gonna go well for, and then determine whether or not it’s better to wait a little bit longer in my curve or sell a little bit earlier on my curve. And, and the answer to that, then that gets down to very company specific, which is why I’m such a big believer in, in forecasting your revenue and your cash flow, because it becomes that forecast over the next 12 to 24 months that helps you realize, when will I start to reach an exit number that makes sense for me to exit on that side. But you really have to first start with the myth that you should, you know, not sell when it’s not going well. The answer is you almost always should be selling when it’s going well, and generally by the time that you’ve waited till it’s leveled off. You know, I always ask the question again, thinking from the buyer’s perspective, if something was going really well and now it’s leveling off, what’s the next thing a buyer is thinking is gonna happen, Kevin?
Kevin King:
If it’s leveling off, it’s gonna go down.
Scott:
Yep, absolutely. So, you know, now you get into the, the, the buyer expression of that is who wants to catch a falling knife, right? So the general way to think about it is about two-thirds into your upswing, you know, before it starts to really level off is often a very good time to exit, because it also gets to the point of when are you gonna get paid on your exit? Most people think that they get paid the bulk of their money on day one, and the reality is, as a lot of the money that you’re gonna get paid for your exit comes after the sale, either in the form of rolling equity into the buyer, or in what’s called an earnout you know, the, or a stabilization payment. So think of the fact that you’re probably only gonna get somewhere between 50 and 80 cents off the of every dollar off the table on day one. And so you recognize that in order for you to hit those future contingency payments, you need to have a business that’s continuing to grow, not through the time that you sold it, but through the time that you get your last payment. And the way I always like to describe that is most people think they exit on the day they sold, I think of an exit on the day that you get your last payment, and that timeframe is often very different from each other. Yeah.
Kevin King:
Sometimes even the, the buyers want you to stay on for a, a set number of months, or even sometimes a year or more. And I know some people that have sold and they’re still running their company, they stayed on and they’re actually still running the company. Do you, do you see that very often? Or is it, yeah, some people think that they can just walk away and go sit on the beach and sip margaritas but a lot of times you’re still involved for a while.
Scott:
Yeah, you are and interestingly enough, I actually recommend that sellers start thinking of having the expectation that they’re gonna be around in their companies for a minimum of six to 12 months. And or if you wanna stay longer, there’s actually now a lot of options where you can be involved all the way up to 3, 4, 5 years and, and stay involved in your company. And, and most people have a, I’ll call it a little bit of a simplistic view of exit, and there’s actually a wider range of different options that you might have. The reason isn’t
Kevin King:
That hard for a lot of people though, coming from you’re an entrepreneur calling all the shots to go into a position where someone else is in essence calling the shots for a year or six months a year, whatever it may be, that’s gotta be difficult for a lot of people.
Scott:
It’s very difficult and you have a lot of money on the table to pay you for that difficulty. Because, you know, the way I would think about it this way, I’m sure there’s a number of people out there on this podcast that have heard somebody that sold their business to an aggregator and and they had earnouts and stabilization payments. They left the company within the first 90 days, they turned it over to the aggregator, and guess what happened? Revenue went down, profit went down, and therefore they missed their earnouts and their stabilization payments, which for many people was millions of dollars. So you, you thought you were doing the right thing by saying, I don’t want to have to go work with a buyer. And, and, and again, that was, I’ll call it what we call the first generation of aggregator exits this next generation going forward, which is what everybody should be concerned about, is more sophisticated buyers that you have money on the table and that you want to set a growth plan in place with your buyer.
Scott:
If it’s an aggregator, great. If it’s another type of buyer great, but you wanna stick around and make sure that the growth of the company still shows up, because you’ll have likely millions of dollars at stake, and it won’t take you 40 hours a week, like when you’re 60 hours a week when you’re running it yourself, but you wanna make sure that you’re getting funding for new product initiatives to get launch. You wanna make sure that money is not being wasted, you know, you know, in, in, in wrong ways, on paid media or on cost of goods sold, but you have so much money at stake. And it was really a, a fallacy. Most of the deals, frankly, that we do at northbound I would say more than half of our deals sellers stay on longer periods because of the fact that they’re larger deals and the sellers, they can really maximize the upside. Doesn’t mean you have to go stay three years, but it does mean that staying on long enough to make sure that the business continues to hit its payments is a very, very good thing, not a bad thing.
Kevin King:
Yeah, I know in this space, now, I’m sure this is getting cleaned up a little bit more sophistication, but I know people that sold two or three years ago, I know two people specifically that come to mind. One in Austin, one in the UK, and one in Austin sold his business, I think 2019 roughly somewhere around that time for like 17 million. And now he’s, he just told me a few months ago, he’s buying it back for 400,000 because the people that bought it just, they tanked it. And someone in the UK just it was just back in may, I was in seller sessions and someone there told me that they sold one of theirs for, I think it’s three or 4 million, they’re about to buy it back for half a million because the people, how often do you see it where these buyers just come in and, and they don’t realize what, what it takes to run one of these things and they, they tank it.
Kevin King:
And so you’re counting on, like you said, you might get 50 to 80% you know, on the signing day, but you’re counting on that other big payout to come and it never comes because so that happens a lot. So you, I always tell people, you need to be happy with that number you get on day one because the rest of it you may never see. If you do, great, awesome. But in a lot of cases, I, I’ve noticed that I don’t know what the percentages are. It’d be interesting if you know that number of how many people that actually end up buying one of these businesses tank it. And I know many more stories I could go on and on here with, with stories. I just, those are two recent examples. I know many more similar examples.
Scott:
Yeah, we’re not the best guide for that because frankly, we handle the premium, you know, businesses and we have more of our sellers stay on. So actually our experience hasn’t been as negative. Now that doesn’t mean that we haven’t sold businesses that people have missed their earnout payments and stabilization payments, but in general, if you stay on as a seller and help the buyer for a little bit longer period of time, the outcomes are a lot better. I agree. And, and then we wanna make sure that you get rewarded. So we design our deal structures so that you can get into premium multiples, you know, when the business goes well. But the bigger point that I’d like to make about this is that lots of people have heard the horror stories and that causes them to think that they shouldn’t focus on an exit or that now’s not the right time to exit.
Scott:
And, and that is a absolutely, a myth is that you still are gonna get more than half your money off the table when you do exit whenever it happens to be. And 80% of the value of your company isn’t based on what’s going on on in the market today. It’s based on what you are doing as your own individual company. I call it the micro factor versus the macro. So you have these people that kind of run around and say, oh, it’s just not a good time to sell companies right now. And, and that does that, that like, that, that’s like a nonsensical statement. There are reasons why you have to be a better company to sell now than two years ago. And there’s a reason why with interest rates being higher, that you’re probably not gonna get the multiple that people were willing to pay two years ago.
Scott:
But the fundamental of when you should sell your company is 80% based on when you have prepared your company for exit, when you have the growth in the right trajectory, when you have the profitability in the right range. And when you have the right amount of diversification. And all of that is generally driven by do you have uniquenesses in terms of product to market fit, unique supplier relationships? Do you have a moat around your business? And so the bulk of why you should exit is because of the math of 50% or more comes when you exit. But the reason when you should exit is 80% based on you. And so you shouldn’t use this sort of general you know, it’s not a good time to exit or it’s a great time to exit because that’s only 20% of the factor.
Scott:
Far more of it is what are you doing yourself to prepare yourself for a premium exit? And if I told people that we got, you know, multiples, you know, in the sixes, you know you know, e even last summer, that stuff can still happen if you have a premium business. But you’ve got to recognize that the bulk of the value of your company is based on you. And so, you know, not use the negative news as a reason to sort of, I’ll call it, either give up or go away. You just have to think about it that buyers are more sophisticated now, so you have to prep and do more in advance of going to market, and you have to have a more clean company when you go to market in order to achieve your goals.
Kevin King:
Well, and I hear a lot of people too, there’s, there’s a debate about whether you should use a company like northbound or a broker or something when you sell your business. There’s some people out there that that say, I know my, I got my together. I know what I’m doing, and why should I give away five or 10%? Yeah, okay. They might, you know, find me some little things here or there, but that’s just too much money to give away of, of something that I’ve, this is my baby. I’ve worked hard to build this thing. Why should I give it to some guy that just comes in at the last minute and give him five or 10% of this? What would you say to those, those people that have those kinds of thoughts?
Scott:
Yeah. So, you know, and obviously, you know because we are an investment banking firm, we help people with exits. And so, you know, people can take this if they want as bias, but here’s the strongest way that I can say it. We’ve done at northbound you know, over $500 million over, you know, half a billion dollars of exits. If, and or when I ever decide to exit northbound, I will not do it myself. And so if I don’t think that I’m confident enough or not even confident enough, I’m the right person to do it for myself. That’s how important I feel that it is for you. And here’s the clear reason why, is that you need good cop and bad cop. You need somebody that can represent you strongly, but that doesn’t have to work with a buyer after the sale to not only negotiate the right economics, most people say, oh, you know, I can get the highest dollar myself.
Scott:
I would argue that that’s very difficult to do by yourself because you can’t push for everything. But it’s also the legal terms. When I’m negotiating on behalf of a client of ours, I’ll say, we are never gonna sign up to this non-compete because it is not standard in the market to have a non-compete this broad. If you are a seller, you can’t make that statement because you don’t have that information. But also because the buyer’s gonna look at you and say, well, aren’t you? So by, by negotiating this hard on the non-compete, it makes me feel like you want to compete with me. So there’s a natural tug and pull where being your best negotiator is very, very difficult. And then the other reason is, is that if your your job during the exit process is actually to improve the numbers of the company, the best way that a seller can make the value go up by 10 or 20% isn’t by trying to take on a negotiating load, where then all of a sudden now you’re getting distracted, you’re on a bunch of buyer meetings and your numbers go soft.
Scott:
Your job is to make sure that you’re doubling down on the success of the business because nothing gets you to a premium multiple more than the last three months, you know, of when you’re negotiating with multiple buyers that the numbers just keep coming in better and better. So getting distracted from that makes it very, very difficult because you’re basically picking up another part-time job. So you know, now that doesn’t mean that you know, people can say, you know, Hey, I want to try and do it myself. I, you know, again, in my experience, it wasn’t like my mentor got me an additional 5%. He literally got me three times the amount that I was gonna get on my own. But I would argue with the time distraction and with the natural negotiating leverage, in my mind, it’s absolutely clear that you’re better protected and you can get your return by building not just an advisor, a broker or an investment banker, but having a very professional m and a legal team and having a very professional tax team to make sure that you’re maximizing it.
Scott:
And the easiest way, I guess the last way I’d say it is, you run your business every day, but most people have never sold a business before. Or even if you sold one or two that does, you know, that compares nothing to people that have sold dozens and dozens and dozens. So you’re basically, you know, going into a very sophisticated process for the first time. And that generally leads to mistakes. And maybe the last way I would say it is, if you ask any buyer out there, you know, the sophisticated buyers would say they actually like to work with investment bankers or brokers ’cause they know they can get a deal done. But they also know that they’re gonna end up having to pay more. You know, that, that’s kind of the feedback from the buyer lens.
Kevin King:
And I think an important thing to get outta that too is that you can’t just wake up one day and I wanna sell my business that it’s a process. It’s gonna take time. And a lot of people, I don’t think they underestimate how much actually work is involved in selling your business. Like you said, it’s like another part-time job of preparing documents and the due diligence and all that stuff. It can be stressful for a lot of people.
Scott:
Yeah. And what we actually saw as a market need and and has been really a fun program for us to work with sellers on, is most people kinda wake up and, and they, I’ll use this year as an example. They’ll, they’ll say, oh, you know what? I’m gonna run my business through the holidays and then I’m gonna sell in Q one of next year. And then it gets to Q one of next year. And then they have a huge amount of work to do, and they think that they can do it in a couple months and then go to market. What we actually believe that the right time to start planning for your exit is 18 to 24 months before you actually close your deal. And, and the reason is, is because there’s a number of things that you can do to increase the value of the company before you go to market.
Scott:
So if it takes you six months from exit to getting the check in the door or signing the definitive agreement, you wanna start at least another 12 to 18 months before that because you wanna make sure that you have your business in order, you wanna make sure you have your financials in order, you may actually want to take in capital so that you can grow faster, so that you can get a better growth trajectory to get a higher multiple. There’s a whole series we call it a prep for premium, where if you want a premium exit, you wanna start about 18 to 24 months in advance. That way you’ll actually be able to prepare properly for the exit. And you’ll also know when is the right time to exit. And if you don’t do it that way most of the time you’re leaving money on the table. In today’s market.
Kevin King:
Just earlier this year, you guys got together with Helium 10, you released a product it’s kind of in companion with the Freedom Ticket and some of the other stuff, the training that Helium 10 has called an Exit Ticket. What is that? Can you just briefly describe what that’s all about and why someone might wanna take a look at that?
Scott:
Yeah. Essentially what Exit Ticket is, is it’s series of videos that walks you through the process of getting ready for exit and then executing the exit. And then equally important, it has a workbook that follows along with it. So when I talk to you about taking 12 months, or 18 months, or even up to two years to prepare for your exit, it gives you a step-by-step way of thinking about your exit. And the, the, the reason why we built it in conjunction with helium 10 is that more than half of the money you get is gonna come upon your exit. But every presentation that I’ve ever given, when I ask for a show of hands of who’s spending more than 5% of their time preparing for their exit, nobody raises their hands. So the thing, it’s very interesting, if you think about that more than half the money is gonna come from doing this one thing, but it’s getting less than 5% of your attention.
Scott:
Now you think of the how much money, hundreds of thousands of dollars that you’re leaving on the table because of that, that’s why I’m so passionate about this topic is that why not go to a blueprint and I call it work on your business, not in your business, and work on your exit with the same amount of passion that you work on PPC and launching. Because all of those other things are gonna pay you 50 cents on the dollar. Why not work on the thing that will, you’ll pay you the other 50 cents, or frankly, for most people it’s gonna be 75 or 80 cents on the dollar is when you exit. And the answer is, most of the people don’t do it because they don’t know what to do. Exit ticket, that program and that workbook teaches you what to do so that you can prepare well in advance for your exit.
Kevin King:
Yeah, I highly recommend everybody that’s listening to this has a Helium 10 membership to check that out. It’s included there when you log in, you see the links for like Freedom Ticket, helium 10 Elite, and then there’s one for Exit Ticket and then one for the PPC Academy as well. So definitely check that out ’cause it’s, it’s some really good training, but that training, as good as it is Scott, there’s, there’s even a better way to actually get with you guys. And that’s something that’s coming up this fall in October. It’s something called the, we hooked up together, you know, I had the Billion Dollar Seller Summit and we hooked up and are creating an event called the a Billion Dollar Exit Summit, the Billion Dollar Exit Summit. And the goal of this is not to come and listen to a bunch of presentations and, you know, like you would at a normal event, but more of a workshop, more of a hands-on type of approach where it’s gonna be 25 to 30 people, ideally doing over $5 million a year already that are coming.
Kevin King:
And you, they’re gonna be able to work one-on-one in a way with members, with you, members of your team. They’ll learn some stuff in a group setting, break up into individual groups, and then you’ll actually be able, they’ll actually be able to go off and almost have like a, a consultation with you where you’ll, you can actually look over their shoulder at their stuff and kind of give ’em some guidance to, to get this going bring in investment bankers and some legal guys and a whole bunch of people that can really address specific needs. Can you talk a little bit about what, what’s in store for the Billion Dollar Exit summit?
Scott:
Yeah, absolutely. Simply put, if you come to the billion dollar exit summit in three days, you’ll have identified what the value of your company is today. You’ll have identified what the potential value of your company can be over the next one, two, and three years. And then you will have developed a plan to realize that value and then go through an exit process, and it’ll all be wrapped together in a blueprint specifically to your business that will show you why you’re worth what you need, why you’re worth what you are today, what changes and decisions you need to make into the business in order to get to your target valuation, and then give you a blueprint checklist for the next one to two years of how to execute on that plan. And then how to negotiate a premium exit for the company. And, and that will be done in a series of, like you said, very intense workshops with advanced financial people looking at your numbers with advanced business and transaction people looking at your story and building the proper story for you to achieve a premium exit in the timeframe of one to two years.
Kevin King:
Yeah, I’m really excited about that. If you want to find out more about it, just go to billiondollarexit summit.com, billiondollarexitsummit.com. You can get all the information there like like Scott said, it’s limited to I think we’re gonna cap it at probably 30 sellers total. So it’s a more of a workshop environment. It’s gonna be in Austin, Texas, so you can get all the information there. Scott, if people wanna reach out to Northbound or learn more about you what, what’s the best way for them to do that as well?
Scott:
Yeah, two things. One in addition to our staff that’s gonna be down there, I don’t want to just mention that. At Billion Dollar Exit Summit, we are going to have, as you said, we’re gonna have an advanced you know, legal team there to answer any of your legal questions. And then we will have other sellers that have achieved eight figure exits so you can learn also from people that have been there. Before, if you want to reach me, the best place to reach me is [email protected]. I’m happy to answer, you know, any individual questions that people might have regarding the topic of exiting. And that is my first name [email protected]. Or go to our website just thenorthboundgroup.com and there, there’s a Contact us form that you can reach there as well. So really looking forward to working with you on the Billion Dollar Exit summit. It’s gonna be a really great way to really meet the needs of what we call that sort of high-end seller community that has a lot of questions about exiting and, and really wants to put a solid strategy in place.
Kevin King:
Yeah, I’m really looking forward to, it’s gonna be great. And Scott, you and I could sit here and probably talk for another five hours on all kinds of cool stuff, but I really appreciate you taking your time. You’re a really busy man, and I appreciate you carving out some time to talk today and to help the audience. I think everybody’s learned quite a bit and got, got a lot of stuff spinning in their mind right now, but what they wanna do.
Scott:
Yeah, same here. Love talking about the topic and really appreciate you you know, serving the community the way that you do. And I’ve used that as a model for myself. Our job is to give as much advanced information as we can to help sellers succeed in this marketplace. So appreciate taking the time with you, Kevin,
Kevin King:
As usual, another great talk with Scott Deetz from Northbound Group. If you’re not thinking about exiting your business right now, it’s something you really should start considering because I do believe that’s where the most money is made. And if you’re already doing $5 million or more in gross sales and want to come join us at the Billion Dollar Exit Summit, just go to billiondollarexitsummit.com. It’s gonna be a small, exclusive group, a workshop format, hands-on access to some of the smartest minds in the space could really make a huge difference in the evaluation you get on your business just by attending this event. So it’s at billiondollarexitsummit.com. We’ll be back next week with another great episode. I’ve got a legend of the industry coming on the episode next week. You don’t wanna miss my talk with her. And before we leave this week, I’ve got some words of wisdom for you. Remember, you can’t change the past. You can only guide your future. You can’t change the past. You can only guide your future. Have a great day.
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