This Is What It Takes to Build a Business, Vol. 3, Part 2
Introduction:
This week, we take another look back at the conversations we had over the past year, highlighting some of our happiest, smartest, and most insightful exchanges. We discuss whose advice is worth taking, whether any business can be remarkable, which businesses should try EOS, why family businesses can be so vexing, what to do when big businesses refuse to pay small businesses, the challenges of pricing services, the backlash against diversity, and finally the remarkably moving story of the moment that propelled one entrepreneur first to get fired and then to launch a remanufacturing business that would hit $60 million in revenue in less than five years.
There aren’t many places where you can hear entrepreneurs talk about the real-life problems they are confronting right now, today, as they happen—with no guarantee of a happy ending. But those are the conversations I have every week with Shawn Busse of Kinesis, Paul Downs of Paul Downs Cabinetmakers, Jay Goltz of Artists Frame Service, Mel Gravely of Triversity Construction, Jennifer Kerhin of SB Expos & Events, Liz Picarazzi of Citibin, Jaci Russo of BrandRusso, Sarah Segal of Segal Communications, William Vanderbloemen of Vanderbloemen Search Group, and Laura Zander of Jimmy Beans Wool. They come from a wide range of industries and geographies and experiences, but they all share a willingness to talk about not just what they get right but what they’ve learned from getting stuff wrong.
— Loren Feldman
Producer:
Jess Thoubboron is founder of Blank Word.
Full Episode Transcript:
The first highlight comes from Episode 207, “A Silicon Valley Bootstrapper Tells All.” The bootstrapper is Sharon Gillenwater, and she really did tell all—including precisely how much she made selling Boardroom Insiders, the business she’d bootstrapped. By sharing that information, Sharon learned a surprising lesson, which is that the founder of a relatively small bootstrapped business can actually walk away with more money than the founder of a venture-backed business that sells for far more.
Loren Feldman:
Now, let’s go back to that TikTok video. What exactly did you share? And why did you decide to share it?
Sharon Gillenwater:
Well, after I left the company, I started talking to people who maybe found me through LinkedIn, or were referred to me through one of my contacts. And these were entrepreneurs, early-stage entrepreneurs who wanted my advice about something or other. And the more I talked to people, the more I realized that I knew a lot more than I thought I did, and that it was a lot more useful to these folks than I thought it would be. When you’ve been doing something for a long time and it’s easy, you just think everybody knows it. “Oh, everybody knows this.” Well, they don’t. And if you talk to people, you can provide a ton of value.
So that’s when I started thinking about the book. And then I got on TikTok, and the reason I got on TikTok is because I was trying to sell the book and no publisher would take me on. They said, “You don’t have a platform. You need to have 20,000 followers,” or something like that. And I had intentionally removed myself from most social media for obvious reasons—politics and all this misinformation that was going on—and so now I found myself in a situation where I had to get back on. And I met a woman who had written a book, and she said, “Get on TikTok.” And I’m like, “What? I thought that was just for dancing.” And she said, “No, there’s a lot of business content on there. It’s a fantastic medium for building an audience.”
And so I got on TikTok, and I started making videos, just like one- to three-minute videos on specific topics about entrepreneurship, like: how to validate your product, how to find your product idea, how to motivate your team. And I was gaining followers, but then my son, who’s a Gen Zer said, “You know what you’ve got to make? You’ve got to make a video on how much money you walked away with, because that’s really what everyone wants to know.” And I thought, “That is so true.” Because when my partner and I, we’d hear about someone we know selling their company, and for days, we’d be like, “How much do you think they got?” And we tried to do the math, and we’d be speculating, but nobody would ever tell us. And so I thought, “I’ve got to do this.”
And it was very scary, because I basically made a video that said: Here’s how much we sold for. Here’s how much we paid in fees to the bankers, accountants, lawyers. Here’s how much we gave our employees. Here’s how much the other shareholders got. Here’s how much I paid in tax. And here’s how much I walked away with. And so I made the video. And then I didn’t sleep—it was scheduled to send, and I didn’t sleep for like three nights worrying about it. And then it went out, and it kind of did well, but then maybe a month in, it just exploded. I was taking a walk with my husband and my dog on a Sunday, and then my phone just started exploding. I’m like, “What is going on?”
And a couple of venture capitalists had posted it who have huge followings. And so that was on a Sunday. I think on the following Tuesday, I got a text from a friend of mine, and she said, “My daughter just saw you on Twitter.” And I thought, “Oh no,” because I was off Twitter. I hated what was going on on Twitter. I thought it was toxic. And so I didn’t post it on Twitter, but not realizing that just because I don’t post it on Twitter doesn’t mean that someone else can’t post it on Twitter. So I got over a million views on Twitter and a ton of comments. And I was so terrified to open the comments. So I made my son read them to make sure that I wouldn’t be terrified.
And that opened up a huge new world to me, of people wanting me to come on podcasts or people wanting me to come to an event and speak, or people wanting me to formally consult with them. So that did actually open up more opportunities that are generating a little bit of revenue, which is fun—but most importantly, and most enjoyably, just meeting some amazing entrepreneurs. That has made me realize that even though a lot of the most high-profile entrepreneurs do behave like assholes, the vast majority of the rank and file, smaller-scale entrepreneurs are amazing people who care about building great companies that serve customers and employees alike.
Loren Feldman:
For our listeners who are not on TikTok, can you tell us? You sold the business for $25 million. How much did you end up with?
Sharon Gillenwater:
I got a little over $13 million, and after all the taxes, I walked away with about $9 million.
Loren Feldman:
Sounds pretty good to me.
Sharon Gillenwater:
Yeah, it was great. It’s amazing.
In Episode 208, “Whose Advice Are You Going to Take?” Paul, Mel, and Sarah talk about the tricky calculation all entrepreneurs must make between sticking to their vision and accepting advice. Sarah explains why she is reluctant to take advice from people who don’t really know the inner workings of her business, which is pretty much everyone. Paul, on the other hand, says taking advice from outsiders helped save his business during the Great Recession. And Mel talks about why he thinks every business should have a board of advisors.”
Loren Feldman:
I want to talk about advice today, specifically: how do you know when to take it? I’ve long thought this is a real challenge for most entrepreneurs, because you have to be pretty willful and independent to go into business. There are always people telling you that you’re a little bit nuts to do that. But at some point, you probably have to be willing to learn from others who may have more experience and expertise.
But of course, even if you’re open to taking advice, it can be tricky. Sometimes, as I can certainly attest, you can have very smart and experienced people offering you very conflicting advice. So to start, I’d love to hear, maybe, about the worst advice that each of you remembers receiving in your entrepreneurial career. Anybody?
Paul Downs:
Oh, I’ve got some. My old partner, who I formed a partnership with in 2002, insisted that if we simply grew our sales volume and didn’t worry so much about efficiency on the shop floor, that everything would be fine. And that’s an enormous mistake, because we lost a ton of money as we were trying to grow. And then the 2008 recession arrived, and we were in serious trouble. Now, I did survive it. But ever since then, I’ve paid much more attention to profitability, rather than just how many dollars are coming in the door. So, that’s a pretty big mistake. Who can match that?
Loren Feldman:
Well, Paul, first, did that advice or that decision make sense to you at the time?
Paul Downs:
No. But part of the issue back then was that I had never really gotten any mentorship from anybody. I taught myself my trade and taught myself business to the extent that I knew it, which was not much. And my partner was older than me, had owned several manufacturing businesses, and was wealthy. And I figured, “Well, he must know what he’s talking about.” But he didn’t, is the short answer. And the longer part of that story is that all the businesses that he had run previously, he had done with the help of his wife, who was a CPA and was the one who actually kept track of costs and profits and productivity and all that.
And I believe I may have told this story before, but about a month after we formed our partnership and she had started working on my business to get the books in order and sort of get everything shipshape, she just died in her sleep. And so, all of a sudden, I had a partner who was deprived of—I mean, he lost his wife of many years. It was very sad. But he was deprived of the steady hand and the attention to detail that had been a large part of all his previous success. And it took me a long time to realize what we were missing. And so it’s a bad luck story more than anything else. I think that if Mary had continued on working with me, then we probably would have been in much better shape.
Loren Feldman:
Sarah, how about you? Do you remember the worst advice you ever got?
Sarah Segal:
So I’m always very hesitant to take advice in general.
Loren Feldman:
That’s what I’m talking about.
Sarah Segal:
Yeah, just because, I mean, when it comes down to it, nobody knows your business as well as you do. And there are nuances and factors that nobody is ever going to be able to know as well as the person who created the business. I was given advice—and I don’t want to say that it was bad advice—it was just not going to work with the model that I was going to create. It was advice of not taking any clients for less than a $10,000-a-month retainer. And, you know, I was like, “Okay, well, if we do that, in my mind, that will get us to a nice cushiony revenue number pretty quickly, etc., etc.” But what it did was, it gave me clients that I wasn’t necessarily passionate about.
They were the clients that had the big wallets and big budgets, but they weren’t super interesting. And I passed on clients that I was curious about and passionate about and interested in and invested in and really wanted to see their success—because I was trying to meet that number. And as you know, last year, I had some big clients that weren’t necessarily in that bucket of making me that $10,000 a month or more leave last year, and it put me in a hole. And so I’ve spent the last six months rebuilding the company based on small- to midsize retainers with more interesting companies that are more in the lifestyle space that makes me happy and I’m passionate about and I liked the owners. Maybe it was good advice. Maybe it was bad advice. But it wasn’t advice that I should have taken.
Mel Gravely:
Both examples, and this idea that entrepreneurs are hesitant to take advice, all come together for me in—it’s gonna sound like a soapbox—but this idea of having a board around you. Because Sarah’s point that no one knows the business like we do is so true. And I don’t think there’s a way to get 100 percent around that. But what I do want around the table are people who are as close as I can possibly get to knowing everything, right? They’re not going to be me, because we feel things about the business that we can’t even articulate.
But when you have a group of people around you that you are talking to regularly, they understand your goal objectives. They know what gets you fired up. They understand the strategy. And they saw you struggle before. They can help you look around corners. Their advice, I think, is more informed about the total situation and not just about their opinion, based on God knows what. And so, Loren, I’ve got at least a story of two people I should not have listened to. But when I look at who’s around the table with me as a board, I have found they give me good counsel because they understand what I’m trying to accomplish better, and their counsel is better. It’s more contextualized than not.
Loren Feldman:
It’s funny. I was going to ask you about that, because you’ve mentioned this on a previous episode. And I think, in fact, after we stopped taping that episode, I think you said to me something along the lines of: You wouldn’t run a lemonade stand without a board. Which I think is pretty unusual for small businesses. I think you’re more the exception than the rule.
Mel Gravely:
Yes, statistically, I’m sure you’re right, but it’s because I don’t want to take ad hoc advice. I don’t want to meet someone occasionally and have them tell me what they think. Because they can’t possibly have the context to answer, to really guide me where I want to go. They were guiding me based on what they think should happen. But as Sarah just said, making her heart dance around certain clients is something that anyone giving her advice, if they don’t get that, then they’re not going to be talking to her in that context. And, you know, why should we listen to those people?
In Episode 209, “Can We All Be Purple Cows?” Shawn, Jaci, and Jay discuss what it takes to stand out these days, especially if your business—like most businesses—isn’t exactly the Next Big Thing. Can any business make itself remarkable?
Loren Feldman:
So you think, Jaci, if somebody comes to you, and looks like a commodity business, pretty much any business, you can turn them around and make them not a commodity business?
Jaci Russo:
We did it for a milk company. Dairy is probably one of the biggest commodities—and I just used air quotes—out there. And we were able to work with this regional dairy and help them go from zero market share—they’re entering new markets for the first time—and within about six months had 18 percent of the market share against organics, heritage, and store brands, even though they were not as healthy as organic. They were more expensive than the store brand. And heritage means people have just been buying it for generations and generations and buy the same thing that everybody bought. But we were able to carve out a niche for them.
Loren Feldman:
Shawn, let me ask you kind of the same question but in a slightly different way. As I’m sure you’re well aware, Seth Godin wrote a book called Purple Cow: Transform Your Business by Being Remarkable. It’s a very readable book, and I think it’s obviously good advice. If you can distinguish yourself, you should probably distinguish yourself. But can we all be Purple Cows?
Shawn Busse:
I remember meeting a guy who, basically, his business was buying scrap steel. That’s it. He’s buying scrap steel from manufacturers, who have offcuts and waste and so forth. And, boy, that is a tough business, because the buyer in that space is some sort of procurement type of person. And so they’re buying largely on price, and it’s hard to defeat that. I ultimately walked away from the engagement, even though he wanted to put money on the table, because I don’t think he was willing to do what would have needed to be done to be a Purple Cow.
And I think that for companies that are closer to being a pure commodity, you have to be a lot more bold. And usually that boldness comes in either the form of culture, where you’re creating a place where employees are really engaged and doing amazing work—because then the customer feels that and then you’re differentiated on that—or the offering, the process, the way you do things is significantly different in the way you deliver that commodity. And both of those things require a lot of vision from the leader. And a lot of times, what I have found, at least in my experience, is that in a lot of commodity-based businesses, the leaders are really fixated on winning by price—by being cheaper than the other guy, as opposed to service, delivery, process, or culture.
Jay Goltz:
Well, you left a whole piece out, though. There’s a whole piece of that, which is: what if the company figured out how to do it cheaper? I mean, I’ve sold scrap. When I cut aluminum frames, we used to say barrels of scrap. What if they figured out, “Oh, they’ve got a good location that’s closer to the customers? Therefore, I’m paying my truck driver a lot less to go pick up every day.” And they figured out how to get it to the scrap recycler cheaper. That is another angle that somebody figured out. Walmart: Someone figured out how to do things cheaper and pass the savings along. So that’s the commodity, but you can still win by getting your costs down.
Shawn Busse:
Yeah, I think that’s a really good point. You might layer into that like, say, technology. So you could put a piece of technology in place that made you far more efficient than your competition. I tend to think that those kinds of moves can be copied more easily than the moves that I’m suggesting. So that’s why I go to those places first.
Culture is really hard. It’s really hard to do in a commodity space. So if you can do it, it’s much harder for your competition to catch up to you. It’s much more of a moat strategy. I think the way you deliver your service to your customer, something that we’ve called the proprietary way—which is a combination of people, service, process—that amalgam is a sort of secret sauce. It’s really hard to copy, versus a technology play. Once your competitors figure out that technology, if they can buy it off the shelf or build it themselves, it’s a little easier to copy. So I’d say, “Yes, and,” to what you’re saying, Jay.
Jaci Russo:
And I’ll just jump in again. You know, Shawn, we’re about 90 percent B2B, too. And so, sure, we’ve dealt with companies that make widgets and small intricate details inside their industries. But I think there’s always a way to separate. If you didn’t start your business knowing you were gonna do something different and better than the rest of the competition, why did you start?
Loren Feldman:
I think we have someone here who might be able to answer Jaci’s question, and that’s you, Jay. I hope you don’t take offense at this, but isn’t picture framing something of a commodity business? How many picture framers were there in Chicago?
Shawn Busse:
No way, Loren!
Loren Feldman:
How many were there in Chicago when you opened up?
Jay Goltz:
Back in the day of the Yellow Pages, I remember counting the number of frame shops. This was probably 20 years ago. There were 69 frame shops.
Loren Feldman:
Wait, you opened 40 years ago, right?
Jay Goltz:
So I’m just saying, at its peak, which was probably in 2000, 20 or 25 years ago, there were 69. And you’ve gotta remember, the framing industry was in a boom for many years, because of the Baby Boomers. They’re framing pictures, and the framing industry really—I’ve been there from the beginning. When I started, it was just starting to pick up steam, and it grew tremendously for the next 45 years. And then it got mature. So then what happened? The chain stores started to pick it up. And now the independent frame shops have shrunk.
So there used to be 69 frame shops in Chicago, and now there’s about 22. And nationally, there were 25,000 frame shops, and now it’s 6,000. So it’s a commodity in that a lot of people do it, but it’s certainly not a commodity if you do it right. There’s a huge difference between a well-run framing business and someone who just showed up and is doing mediocre framing.
In Episode 212, “Why You Should Run Your Business on EOS (or Not),” Shawn, Paul, and Laura call on their own experiences to assess whether the EOS operating system—as explained in Gino Wickman’s book, Traction—lives up to its promise of freeing owners from frustration, helping them put the right people in the right seats, and generating all of the scale they want. Laura hired an implementer to install EOS in her business years ago. Paul took more of a do-it-yourself approach, picking and choosing from the book’s suggestions. And while Shawn hasn’t tried EOS in his own business, he has seen how it works in lots of client businesses. As a result, all three have strong opinions about what types of owners and what types of businesses are likely to do best with EOS.
Loren Feldman:
Paul, if I’m not mistaken, you kind of DIY-ed a version of EOS. What got you interested in doing that?
Paul Downs:
Well, I had seen one of the members of my Vistage group be extremely successful with it. As a matter of fact, the guy who I think is the smartest one in the whole group—and that’s saying a lot—implemented it, pretty much by the book. And he just had a great business, which he recently sold for 25 million bucks. And it was a company that does valuations of small businesses for SBA lenders. And he grew it from, I don’t know, two or three people, all the way up to 20-some. But what always caught me were his margins. He was taking home 25 percent of the gross, which is astonishing.
Loren Feldman:
Do you think it was because of EOS he had that kind of margin?
Paul Downs:
This guy would succeed, probably no matter what. But what’s interesting is that he felt that it was helpful. And so if you see someone who’s really smart and has a lot of experience in running different businesses. His family is from India, and they emigrated to the United States in sort of the classic immigrant story. And apparently, in each generation, the older ones would get together and figure out which of the nieces and nephews and grandkids was going to be capable of running a business. And they got him started very early. I think he was running some Wingstop franchise or something at age 17. And then they bought him a couple of liquor stores, and he ran these things, and it taught him a lot. And then he started his own business. And at the end of all that experience and help, he’s like, “I need EOS.” And then he got it, and it worked out very well for him. So, you don’t ignore that when you see it happening.
Now, when I read the book, what I felt was that, first of all, I gave my people the little quiz they have at the beginning. And it’s like, I don’t know, 20 questions or whatever, and it gives you a score that’s supposed to, I believe, demonstrate what a screw-up you are. But it turns out that we were actually scoring in the you’re-doing-great range. So it’s like, okay… And I just didn’t feel all that compelled to then follow this book and do every single thing in it, because apparently I was already doing a lot of the stuff in it.
And the one thing that I’ve identified as a weakness then and still have as a weakness now, is laying out something like a five- or 10-year vision for the company. Because I’m not sure, particularly back then, exactly what it was going to be, and I’m still a little uncomfortable projecting that. I would rather have people focused on the nearer-term. Because, honestly, 10 years from now, I better not be in this business. And I don’t think that’s a big motivator for your team. Honestly, like, “Hey, hey, I’m planning to cash out and go smoke cigars on the beach, and you people can stay here and keep working.” I don’t know why that would motivate anybody.
Loren Feldman:
Is there anything in particular that you took from that experience that is still working for you?
Paul Downs:
Well, I think that having the right people is critical, and I have a pretty good idea of what kind of people I want to hire. And one of the things that they talk about in the book is that the people who are with you at the beginning are unlikely to be suited to a bigger company. And I think that that’s absolutely true. At the beginning, you don’t know how to hire. You just grab everybody who happens to be around, and often the kind of people who want to take a chance on a very small company have their reasons for it, and that may not be something that translates into a bigger company.
But I think that one of the weaknesses of the book is, like so much advice, it’s aiming at a type of company and a type of growth and a size of company that’s just way beyond where I’m ever going to get. Like, I’ve got 28 people right now. So going from 12 people to 28 is a pretty big change, but it’s not the same as going from 12 to 200. And when you try to write a book and sell as many copies as you can, it’s not like, “The EOS for going from 12 to 20 people.” They’re just trying to call it, “The EOS that fits all sizes.” And so some of that advice, I think, is harder to implement at certain places where a business may be, because it’s more generic. And it’s more talking about somewhat larger organizations.
Loren Feldman:
Shawn, have you ever thought about implementing EOS?
Shawn Busse:
Yeah, so I have had a lot of experiences with EOS, either through clients or friends. I’ve probably seen various versions of it done, I don’t know, maybe a dozen times or so. The other way I relate to it is, EOS, you might call it like a stepchild of the Rockefeller Habits book by Verne Harnish. So, I got exposed to that through the Entrepreneurs’ Organization when I was in their accelerator program, and I implemented a lot of what Verne had to say, the stuff around mission and purpose and values. We had done a lot of that already, but a lot of it got a lot more focused when we started working on that.
And I found having a system that we were operating on was a pretty effective way to help scale the company. But I guess, also, I think Paul’s touching on some of my experience, too, in that it is a bit of a one-size-fits-all. And what I’ve observed from those who’ve done it is it’s truly an operating system. It’s not a strategic system. It’s not a marketing system. It’s not a business model system. So if you’re going to it looking for those types of solutions, it’s not really a good fit for that. So if you have a business with a clearly defined customer, it’s scalable, the market wants what you’re selling—like Paul’s friend. It can be really good for that, because you’re really looking to amplify the thing that’s already working well.
Loren Feldman:
Shawn, could you define that? Explain what it does in terms of an operating system, the thing you say that it’s best at. What does it give a business?
Shawn Busse:
It’s giving you a rhythm and a way of working that is designed around repeatability, measurement, and growth. It’s really about amplifying the things that work, ideally more effectively. Now, I have a lot of complaints about how it goes about doing that. I think it’s pretty simplistic in a lot of ways. But generally, it’s about amplifying known things.
So if you know what you need to do, and you know what type of people are there to do it, it’s really oriented for that. And so businesses that are built like that—say, like manufacturing, where you’re making the same thing over and over and again—it can be a good system for that. Because then you can really start to identify where your strengths and weaknesses are within the system. Because it’s really designed to help you pinpoint where the problems are and to resolve those problems.
Loren Feldman:
Paul, did you find it helpful with that?
Paul Downs:
Uh, no, because I was already kind of doing it.
Shawn Busse:
Well, and actually, Paul’s not a manufacturer. People call Paul a manufacturer, and that’s not correct. Paul’s a value shop. Paul builds custom solutions for unique clients. And there are consistencies, like Paul has to sand the wood, and Paul has to take raw material and plane it down. But he’s not making the same thing over and over again.
Loren Feldman:
But he’s a custom manufacturer.
Paul Downs:
Well, no, the distinction that Shawn’s making is pretty good, because we’re very, very different from a factory. And actually, my buddy who had the SBA lending program was much more like a factory, because every valuation sort of came in from the same place. It came from a bank in the form of some packet of information. The same things needed to be done to it, and the output was always the same.
So, there were variations in what each company looked like, but they developed a method that could be executed by people with a certain amount of training, but they didn’t have to be geniuses. And that’s one of the reasons why the business was so successful and so profitable. They figured out how to do one thing over and over and over again, and they put all the customization not in the hands of the people doing the work, but in the hands of the customers. I had him evaluate my business because I wanted—reasons. Anyway… [Laughter]
Shawn Busse:
Reasons.
Paul Downs:
Yeah, and so I went through the process. And what it was is, I got a questionnaire, which is clearly the same questionnaire they gave everybody. Now, I had to do a bunch of work to answer it, but I was transforming my own information, experience, whatever, into their format, so that by the time their analysts got to producing the valuation, it was pretty much boilerplate.
Shawn Busse:
Yeah, I think that when you were describing your friend, Paul, I was like, “Oh, EOS is perfect for that type of business.” I knew a guy who ran one of those businesses. And anytime you have a business that’s really systems- and process-oriented, where the inputs and the outputs are really similar, that’s where a system like EOS can work pretty well for you. But if you think about the stuff Paul does, the customer is highly variable. The end product varies a lot. Sure, it sits on the floor in a room, but that’s about it, you know?
Paul Downs:
Sometimes.
Shawn Busse:
Right, maybe. And similar to my clients—every client I have is different; every solution they need is different—I think if anybody’s listening to this and they’re trying to decide, “Is EOS right for me?” I would say that the further you are on the spectrum towards consistent outputs, inputs, and processes, then it will probably help you improve some of those things and become more efficient and more profitable and more scalable. If you’re on the other end of the spectrum, I tend to believe that EOS is probably not the best answer for that.
In Episode 214, “Should I Buy the Family Business?” we published another Entrepreneurial Fish Bowl brainstorming session with Chris Hutchinson. In this case, it was BaLeigh Waldrop who explained why she has mixed feelings about taking over the Miller Waldrop furniture business that her parents own. BaLeigh has some real concerns: the business has been down of late, it’s predominantly brick-and-mortar, and she would have to work out an ownership structure with a younger brother. As you’ll hear, the 21 Hats brainstormers ask some very smart questions.
Michael Bice:
My name is Michael Bice. I run Vortex Engineering, which supports the modernization of ships and submarines for the Navy in San Diego. My question was, when you say they own it 100 percent, do they also own as an asset all the real estate and all the property along with that?
BaLeigh Waldrop:
Yes, my parents own all of the real estate, everything in the business. There still is a little bit of debt that they’re paying off in relation to some of the assets, but they own it all. And so that’s definitely a question, too, in transfer of ownership. There’s so many different ways that could look, right? Like, they keep the real estate, and we pay them rent. We buy the real estate from them. I think the possibilities are endless on how it could be structured.
Chris Hutchinson:
That’s great. Well, let’s keep asking questions.
Paul Downs:
Paul Downs, Paul Downs Cabinetmakers. My question was: Is there any debt? And that was, I guess, answered. But I always prefer to hear answers that actually have numbers in them, rather than there’s some or there’s a little. Second thing would be: What were your revenues in the last two years? Because you mentioned what your peak years were: $15 million. But what’s it looking like now? And then, the last one was: Have your parents set an asking price for this?
BaLeigh Waldrop:
Yeah, okay, lots of questions. So, since it’s not my business, I won’t share exact numbers about the debt. But definitely, the goal is, my family has a five-year plan for the debt to be completely paid off so that when the ownership is transferred, it’s completely debt-free. That’s the goal, and we’re on track to do that right now.
As far as sales, 15-16 million was where we were during the peak of our Covid boom. Then we went down to 12, and now we’re more like 10. So we’ve definitely seen a decline, as everyone has in the furniture industry. But I feel really hopeful that we’re going to be able to pick it back up. And then, you had another question.
Paul Downs:
Yeah, have your parents set a price?
BaLeigh Waldrop:
Oh, no, we haven’t set a price yet. The goal is to find a payment, I think, that would be doable for the business, but also be fair to them and set them up for their retirement well.
Josh Patrick:
I’m Josh Patrick, the Sustainable Business. Do you want to buy the business? And does your brother want to buy the business?
BaLeigh Waldrop:
Yeah, that’s a great question. I mean, I think part of the reason I’m here is, I’m unsure if I want to buy the business. Right now, my brother definitely does. He’s all in.
Josh Patrick:
Well, if you were sure, what would be happening?
BaLeigh Waldrop:
What do you mean by that?
Josh Patrick:
Well, if you were sure you wanted to either buy the business or not buy the business, what would be your decision points for that? I mean, what’s preventing you from answering that question yes or no?
BaLeigh Waldrop:
I think it’s threefold. I think I need some clarity around a good path forward for me and my brother to be partners in the business and what that would look like. I think that’s the first thing. I think the second thing is, I just need to ease some of my thoughts about my anxieties of the future of brick-and-mortar retail and where the business is going in that direction. And then I think, third—and I don’t know if this is a question anyone on this podcast can answer for me, but just a little bit of an existential question of—this has been in my family since 1952. It’s all my family has done. It’s what I grew up in. Do I want to go and pave a new path for myself?
David Barnett:
My name is David Barnett. I run a consulting business where I help people buy and sell businesses. And so the first question I have is: Are the family members being paid a fair market wage for the work that they do? So are you getting paid the amount that strangers would be paid if they were filling the roles?
BaLeigh Waldrop:
Yes, that’s a good question. For the most part, yes.
David Barnett:
Okay, and are there positive earnings in the business right now? Is it making money?
BaLeigh Waldrop:
Right now, we’re at break even, and this is the first time in company history that we haven’t been profitable. So, this is also a hard time to think about taking it over.
David Barnett:
But now, you said you own the buildings. So is the company paying rent to anyone?
BaLeigh Waldrop:
We’re set up in different LLCs, so the company’s business is paying rent to the LLCs that own the real estate, but it’s all under the umbrella of my parents.
David Barnett:
Okay, and is the rent being charged a fair market rent? Or is it just the amount you need to cover the mortgage payments?
BaLeigh Waldrop:
A little bit of both. I would say two of our buildings are probably not at market, and then I would say one of them is.
David Barnett:
So if you didn’t own any of the real estate, if you had independent third-party landlords, this company would probably be losing money right now?
BaLeigh Waldrop:
Yeah, for sure.
In Episode 224, “It’s Not a Circuit-Board Business. It’s an Asset,” Karla Trotman explains that she grew up in a manufacturing business, Electro Soft, that her father started, but she never intended to make a career of it. Instead, she found success in corporate America. Over time, however, she also came to realize the true wealth-building power of owning a business—any business. “It’s not a beauty salon,” she says. “It’s an asset. It’s not a shoe-shine store. It’s an asset.” That realization sent her back to Electro Soft—although the transition took a little longer than she expected.
Loren Feldman:
Was your father thrilled when you started to express interest in coming into the business?
Karla Trotman:
Absolutely, he was. He was going to sell the company until I expressed interest.
Loren Feldman:
How close did he come? Was he actually looking around for a potential buyer?
Karla Trotman:
Well, manufacturing is very much in demand for a lot of buyers. I think I get at least an offer suggestion every week from someone who’s interested in buying us.
Loren Feldman:
That’s a nice thing.
Karla Trotman:
Yeah, it’s great. And he had built a company that he didn’t have to be at all the time, so he had put all the systems in place so he could have gotten a high multiple, if he did decide to sell. But he really did want to keep it in the family.
Loren Feldman:
That said, as I read in your book, your transition, I believe, lasted 11 years. Do I have that right?
Karla Trotman:
That’s so embarrassing, but, yeah, it did.
Loren Feldman:
Tell us about that.
Karla Trotman:
So, whenever you deal with succession planning, what the previous generation is looking at is their own mortality. They’re thinking, for some reason, that, “You don’t want me around anymore. You’re sending me out to the pasture.” And it’s really not the case. It’s just that I was ready for myself to move into that role.
I had left my corporate career to do it, and I was at that age of being over 40, which makes it a little bit more difficult to find a position that will be able to meet your lifestyle needs and the level of success that you’re at without it being troublesome. So, it was just a pivotal moment for me in life. And with the promise of three years, I was fine with three years. But after that three—
Loren Feldman:
The promise of the transition was it was supposed to take three years?
Karla Trotman:
Correct, that was the first thing. So I said, “So Dad, I want to take over the company.” He’s like, “Oh, that’s great. I want to retire in three years.” I was like, “Okay, I can do three years. We can work together.” And three years came and went. And then I said, “Hey, three years.” He’s like, “What three years?” I said, “Your retirement has come. It is time.” And he’s like, “Uh, yeah, I need three more years.” I’m like, “Okay, that’s fine.” And so that went on until I started to come to the realization that: He’s going to drag this thing on forever.
So I started doing a lot of research about family business transitions. And one of the books that I had come across was Hug Your Customers by Jack Mitchell. And in that book, he talked about having family meetings. And I said, “Oh, that’s great. We’ll start to have family meetings, and that way he can see what it would be like if I worked with my brothers, and we can get everyone on the same page.”
And I also had reached out to a company that was used to transitioning family businesses. I actually knew the office managing partner, and asked him to come in and help us. And we did a third-party assessment of myself and my brothers to see who would be most primed for leadership, if we should go and all three run the business, like how it was going to work out. Just to kind of push him along, give him a little bit of a nudge. And he just really kept throwing the brakes on at every point. But it was important that I picked somebody—that managing partner was somebody I knew who could go toe-to-toe with my dad. Because he’s former military, I knew he could walk right over anybody and almost bully them, but I knew that this gentleman was not to be bullied. So that was really helpful during that time period.
And then I also realized that my dad wasn’t going to just one day say, “I dub thee CEO.” I had to show him, and be CEO. So I just started making CEO decisions and really taking over the direction in which I wanted the company to head, because he wasn’t really even there anyway after a while. He was spending a lot of time on the golf course, which he should, and really enjoying life, which I wanted him to, but I also was ready to move forward. So that whole time period took 11 years.
Loren Feldman:
What do you think kept him from letting go then, if he wasn’t there that much and you agreed on the important stuff? Why did it take 11 years?
Karla Trotman:
I think because folks now see that when people stop working, they tend to fall apart and have a lack of purpose. And then they pass on. I think he just didn’t want that for himself, even though he’s very active, and he’s very healthy as well. For him, he just said, “I’m not ready.” And, “This is mine. This is my thing I started. I’m not ready to leave.” And you see that a lot, and they’re not willing to—almost in a way that my dad, when he did transition, was like, “Okay, here’s the business. Don’t touch anything. Just, you know, put it in neutral and let it coast.” [Laughter] And I said, “No, that’s not how we’re going to do this.”
In Episode 215, “When to Pull the Plug, When to Pull the Trigger,” Mel, Jennifer, and Liz talk about deciding when to give up on something that’s not working and when to take the plunge on a new venture. While Mel says he’s often been too quick to invest in a new venture, Jennifer says she tends to be too conservative. In fact, she acknowledges that she’s been sitting for years on one particular idea that she really wants to try.
Jennifer Kerhin:
I have a new idea that I’m not ready to talk about. But I have a new idea that’s new in the fact that it’s new for the past five years I’ve been talking about it. [Laughter]
Loren Feldman:
Maybe it’s time to tell us about it, Jennifer.
Liz Picarazzi:
Now’s the time!
Jennifer Kerhin:
It is going to be my 2025 goal. It’s a new service, and I am tired of talking about it and tired of not making the leap. So I have told myself: I’m putting it in the budget for next year. But Mel, I’m like the exact opposite. I’m too risk-averse to try this. And what’s the worst that can happen? It fails, and I think I’ll probably lose $50,000. I’m trying to figure out how much money I’d lose, which is significant, right? But I’m not going to lose everything. And it’s been five years and I’m still scared of it.
Mel Gravely:
Well, I get it, by the way, and the reason I think I am the way I am is I sometimes don’t know any better. So keep in mind, I used to run a construction company, and I’m not a construction person. So these ideas made sense to me, and my team would freak out, and then I’d go do it anyway, because I was CEO and I could. And then they’d have to rally to save me from myself later on.
And we just talked about this last week, that the concern that I have, and the board has now, is there are no entrepreneurs left in our company. And so the fear is, we’re going to become a construction company, and if we are, we’re going to have a real tough time competing. So they’re working through that.
Here’s what I would say: I think, “How much would you lose?” is a great question. There are two other questions I just invite you to ask, Jennifer. And one is: What is the true upside? And is this a sustainable business that drives an upside that you’ll say, “Glad we did it,” if it wins? And the second part is: How distracted will it make you and your team? Because what I have found is, if it doesn’t have a big enough upside and it distracts the team too much, it probably wasn’t worth it—if that makes any sense.
Jennifer Kerhin:
It totally does. I’m writing this down right now, and I’ll tell you by the end of the year.
Mel Gravely:
Yeah, you’re going to do it with the existing team, probably, and so someone’s going to be a bit distracted. And what’s that going to look like? Because I’m assuming people are busy in your organization, like they are in all of our companies. But if you can work your way through that, then, man, I say, go for it. And if it doesn’t work, stop doing it, and try something else.
Loren Feldman:
Jennifer, just to confirm, it sounds like this is an idea that you would do within the structure of your existing business, not an entirely new business, correct?
Jennifer Kerhin:
It’s a joint venture. It is in the same industry. It would be with my staff doing the work. And I have thought considerably, Mel, about my distraction level. That’s one of the big reasons I didn’t do it before, because we have been in rapid growth mode. And I could not devote one more minute in my brain or my body to do something new. But I’m, as we’ve talked before, almost at the end of the Valley of Death. And so, the new idea would be with my staff, but as a joint venture.
Loren Feldman:
Intriguing.
Jennifer Kehrin
I’ll let you know.
In Episode 216, “Being Civilized Ain’t Gonna Do It,” Shawn and Jay respond to a Reddit post, where a business owner asks what he can do about a large commercial client who simply refuses to pay a $40,000 bill. “Did I just learn a $40,000 lesson?” the devastated owner asks. “What now?”
Jay Goltz:
Well, guerilla warfare. He could go set up in front of one of the restaurants with a big sign and—[Laughter] You laugh. I’ve had three collection cases where I’ve actually showed up at the place. There was a law firm, a class-action law firm. They had someone embezzling from them, and they were pissed about it. They bought a bunch of art for the offices. It was on the walls, but—this was back when faxes were the way—they sent a fax saying she wasn’t authorized to buy this. “If you’d like to pick up the art, feel free to.”
Okay, so I put a little blue suit on. I show up. I go to the front desk. And I say—I knew her name—”I’m here about the Wilson situation.” And the two managing partners came out because they thought I was with the FBI or something. So they whisked me into the office, and I said, “You probably didn’t recognize my name. I own blah, blah, blah. I sold you this artwork.” And I said, “What are you doing?”—and I shamed them into paying me. So there is stuff you can do other than just sit back.
A restaurant stuck me one time. I walked in there Friday night at six and said, “You can either get me a check, or do you see that artwork hanging over those people? I’m gonna go in there and take it off the wall. And feel free to call the police, because I don’t care. I own my own business. I could use the publicity.” Got a check. So, you know, there is some stuff you can do—being civilized ain’t gonna do it, though.
That’s a terrible story, and I think I would make them really uncomfortable, because I can tell you all the civilized people are just throwing in the towel and going on Yelp. I think you show up at the front of the restaurant and make a game out of it and say, “I’m not leaving until I get something.”
Loren Feldman:
Shawn, have you ever been stiffed on a big bill?
Shawn Busse:
I have been stiffed twice in my career. Once was in the Great Recession. I had a client who went bankrupt, and I remember him calling me, and I was a baby business owner at the time. And he’s like, “Yeah, sorry. You know, we just can’t pay it.” And then I kind of learned how bankruptcy works. And you do kind of get screwed, but I don’t know. It was just interesting. I probably would have handled that differently today.
Jay Goltz:
I don’t know that you can call that being stiffed. I mean, you gave credit. And trust me, I used to have a different view of it. Like, people do go bankrupt. I mean, it’s the nature of the beast. But in this case, for the person who wrote into you, Loren, it doesn’t sound like they’re going bankrupt. They just decided they’re just not going to pay him, and that’s a whole different animal.
Loren Feldman:
Well, there is another lesson here. The guy did some research after this all happened and found out that there was a reputation there. He probably should have done that research before. Correct?
Shawn Busse:
I mean, especially if this is a new customer that he’s not done business with before. I think there’s a good lesson there of smaller invoices, more frequently, figuring out: Is this a reputable person? Are they going to pay me that $5,000 invoice at the beginning of the relationship? And if they don’t, then the past is usually an indicator of the future.
Loren Feldman:
Do you guys do that kind of research into a new customer or client?
Jay Goltz:
Oh, I made an edict years ago that if anybody’s to get credit, they have to fill out the credit form. It’s got to be checked. And if it’s some big company, I said, “Then get me to sign it.” But never again am I going to ship out an order without having a signed—and it’s never happened since. So I haven’t had a lot of problems with that.
I would say the person needs to decide. I just don’t like getting taken advantage of. I’m telling you what I’d do. I’d go in front of that restaurant on a Friday night, and I’d get a card-table chair, and I’d sit out there and explain to every person coming in what lowlifes they are. And then they’re going to say, “We’re going to call the police.” “Go ahead, call the police. Looking forward to it.” Like, that’s bullshit. That is just bullshit.
In Episode 218, “A Few Good Plumbers,” special guest Rich Jordan tells Shawn and Jay what it was like buying a small plumbing business in 2020 despite having very little experience with either plumbing or business—but having spent 10 years in the Marine Corps. Not surprisingly, it took Rich some time to figure out what he was doing, but in just four years, through organic growth and a few acquisitions—while taking no outside capital—he and a partner have gone from three plumbers and $1 million in annual revenue to about 90 employees and $20 million in revenue.
Loren Feldman:
Rich, I think you said that in that first year, you made some pricing changes that were impactful. What happened there?
Rich Jordan:
Yeah, I’d say we screwed it up at first. With plumbing and heating businesses, you kind of have companies split on either side of a line. So companies basically either charge time and materials. So they give you an hourly rate, and then they have a mark-up on materials, and that’s what they give you, and it’s very transparent. And those are usually shops like the one I bought, like, very, very small.
And that can be frustrating for the homeowner, because a lot of times, the bill at the end of the day is a surprise, depending on how long the job took, or whatever. You know, I’m not getting agreement on the price until I finish the job and tell you how much it is. And sometimes that can be rough on the homeowner. But other companies are flat rate, like upfront pricing companies. Typically, you’ll see any kind of scaled company is going to be a flat-rate, upfront-price company. And that’s basically every sort of task that can be performed has a set price, like menu-style pricing.
Jay Goltz: saw our margins just crater. And we weren’t really smart enough to figure it out at first. And the reality is that our billing efficiency tanked, is what happened. So now, being in the industry a little bit longer, a plumbing service company that’s on an upfront-pricing model is generally only going to bill for 40 percent of its time. So if a guy works a 10-hour day, he’s only going to bill for four hours, because he did four hours of wrench time. He had all this drive time, and he had all this diagnostic time and presentation time and explanation time and all that stuff. So basically, 40 percent billing efficiency means whatever hourly rate you needed to charge, your kind of back-of-the-house hourly rate and that upfront pricing math needs to be two and a half times whatever your desired hourly rate is. Does that make sense?
Jay Goltz:
I knew this was coming. I was waiting for the punchline because, I mean, I live through it. You know, we hang pictures. And no matter what I charge per hour, it doesn’t cover it. Because there’s no way I’m billing for anything close to eight hours a day. It’s your point: loading the van, unloading the van, coming. It’s the nature of the beast. That’s why stuff costs more, because it takes longer than you think. When you build everything else in, you certainly can’t just charge for quote-unquote wrench time.
Rich Jordan:
Yeah, absolutely. So we basically went through a very difficult two months financially when we made that choice and didn’t understand the math behind it. Ultimately, we adjusted rates to accommodate that change in billing efficiency, and then it worked. Because I talk to guys all the time now, they’re getting into the trade for the first time and taking over a time-and-materials company, and they want to switch to the flat rate. I think I’ve saved quite a few folks from the same headache that I had.
In Episode 221, “The D.E.I. Backlash Hasn’t Changed Mel Gravely’s Story,” Mel talks about writing a book, Dear White Friend, that was aimed primarily at fellow business owners. In the book, Mel suggested strategies for those who might have been motivated by the murders of Ahmaud Arbery and George Floyd to operate their businesses with more intentionality and more diversity. It’s been less than four years since Mel published the book, but of course much has changed since then. In this conversation, Mel talked about the backlash that has ensued and the strategies he still believes can work for those who don’t consider diversity a dirty word.
Loren Feldman:
I want to ask if you’ve changed how you think about any of this in light of the backlash, but I want to emphasize a couple of things that I took from the book. One is that you were very open in acknowledging that you yourself benefited from some folks who were intentional about reaching out to you. In fact, at that Tugboat event, if I remember correctly, I think you referred to yourself as an “affirmative action baby,” which kind of has a different ring to it today, given the way people talk about affirmative action now. Has anything changed about the way you think about that, given the backlash?
Mel Gravely:
No, not at all. Let me just clarify why I say I’m an affirmative action baby. There were two or three, at a minimum, situations or times in my life where it was obvious that I was there because someone was intentional about providing me, because of my race, a particular opportunity. And without that access, I would not have gotten that opportunity. It happened with the college I chose to go to. They were starting a new co-op program for minority IT professionals. I got that opportunity, and I did very well there. It happened again at IBM, when I joined IBM in the late ‘80s.
So my point is that that intentionality—in the book, I call them “actions of intentionality,” not affirmative action, because apparently that branding has gotten so negative—but actions of intentionality providing opportunity for people. And if you look at the balance of at least my life, the investment of the actions of intentionality has clearly produced returns, whether it be for IBM, for the college I attended, for the city I live in now. And so if we look at it from an investment/return standpoint, I don’t know why the branding has gotten so off. But you’re right, affirmative action is definitely something that has become negative.
And people say, “Well, don’t you worry about that diminishing who you are?” No. Deal with me, and you’ll find out there’s no diminishing of who I am because of how I got to the opportunity to sit in front of you. Deal with me on a business transaction, or on a board, or in the community, or leading my company, and you’ll find out that, no, there’s no diminishing of me because of how I got the opportunity. So, maybe things are a little different now, I don’t know. But no, my thoughts have not changed. And I think time, I think history, will tell, will teach us that it was effective then, and we’re going to miss some opportunities if we’re not careful.
Loren Feldman:
As you point out, clearly the ROI is there for the people who reached out to you. One of the other things I liked about the book, though, is that you acknowledge: It’s not foolproof. It doesn’t always work. And in fact, I think you have a section where you refer to the way you run your business. At one point, I think you had a division that you required to meet a quota of 20 percent African-Americans, was it? And that didn’t work out, which you acknowledged. Why didn’t it work out, and what did you learn from that?
Mel Gravely:
Well, it didn’t work out because I gave the mandate without clarity. I’ll take complete responsibility. I gave the mandate because I thought I was doing the right thing, because this division was struggling to hire people of color. And I was like, “I want you to be serious about this. Let’s get serious. Let’s put a number on it. Let’s get really serious about it.” And they translated that to mean: No matter what that person did, I wasn’t letting them go because they wanted to get to their 20 percent. And so you had performance challenges. We had attendance challenges.
You know, all these things are going on unbeknownst to me, but they were keeping their 20 percent. And that is what I said. It’s not what I meant. And so, we went in and revisited that. We still struggle in that division, for sure, to hire African Americans. But we’ve got a different way of going about it now, and catching folks a little younger, training them a little differently, pairing them up and partnering them with mentors. So we’re trying new approaches. But I can’t just give that number mandate and think that it’s not going to get a little twisted up, and it did.
Loren Feldman:
It’s great that you acknowledge that even you could struggle with it. I know a lot of well-intentioned people who have sought to create more diversity within their companies and struggled with it. They didn’t come at it the way you did, because it wasn’t part of their purpose. So they didn’t have the same need, the same commitment to it. Do you have any advice for people who are trying to do that and struggling with it?
Mel Gravely:
Yeah, well, advice would be strong, but I always invite people to think about: What’s your posture on this? You know, is this interesting to you, this whole idea of diversity? Is it important to you? Or is it imperative to you? Interesting says, you know what? If it comes to you, you’ll take it. You’re not against it. You’re willing to talk about it. Important means you’ve got some plan, but you don’t want to go too fast or go too far. Imperative is where I sit and where, I hope, 85 percent of the time, my company sits. That means we have to win in that space, because it is a part of our purpose, and it’s part of our value proposition, and so it pushes us to try innovative things.
In Episode 219, “I’m Not Building Wienermobiles My Whole Life,” special guest Travis LeFever shares the unusual journey he and his co-founder wife, Amanda, have taken to build Mission Mobile Medical, which makes mobile health clinics in Greensboro, N.C. That journey led Travis, somewhat improbably, to overseeing sales for a company that manufactured specialty vehicles, including the Oscar Mayer Wienermobile. It was there that Travis had a life-changing experience when a nurse with a federal grant asked if he could build a mobile clinic to reach patients in underserved communities. That was the spark that led Travis and Amanda to cash in their insurance policies and start Mission Mobile Medical in 2020. The company, whose remanufacturing process allows it to create mobile clinics in less time and for less money than its competitors, expected to hit $60 million in revenue in 2024.
Travis LeFever:
I got a consulting gig to do a turnaround project. A friend of mine was working with a specialty vehicles company, and they built things like the Oscar Mayer Wienermobiles or Planters’ Nutmobiles. They were super cool, special vehicles, mainly for marketing, and they were having some trouble in sales. And, of course, you know, turn it around, come in, big sales and marketing effort. I was VP of sales. And we started landing clients, Lockheed Martin, Caterpillar, the Navy, Facebook, Procter & Gamble, you name it. And we turned it around. The second year I was there, I think, was their best year in 46 years. So we were doing good.
And then in summer 2019, we had a nurse from our local hospital come in, and she asked if we could build a mobile clinic. And we’d never built a mobile clinic. We’d done a few healthcare-adjacent things. But our tagline was, “If you can dream it, we can build it.” And so it was very much like, “Sure!” And so we sat down, and we put together this proposal: a pitch for this really complex, custom, 40-foot-long coach, biggest generator you could buy, all the bells and whistles. And I took it to her, and I said, “Hey, look at this. Sit with me. Look at this.” And she laughed at me. She said, “You really don’t understand what we’re trying to do, do you?”
And she began to educate me—for lack of a better term—on the number of underserved people in our community and how scarce funding was to care for them. And she said she had a grant for $250,000. She had till Christmas to spend it, and really, what could we do for that? And so I went back to that organization and met a little bit of resistance. They really didn’t want to do a low-margin job, really didn’t want to do anything outside of building custom vehicles. But I finally got them to say that if she would take a remanufactured RV—which is, you know, an RV that you take all the consumer stuff out of and rebuild it with commercial stuff—they thought they could do it for 250 K. So I went and asked, and she said what was, in hindsight, really the magic words, which is: “It doesn’t matter. It needs to be out of the sun, out of the rain, and run every day. And I think it’ll help these people.”
And that took us to the day that changed my life forever, which is when I invited her over to sign the contract. Now, you can imagine my experience signing contracts with folks like Lockheed Martin and the Navy. You know, it’s a very businesslike affair. There’s a lot of terms and conditions and box-checking, and then when it’s over, there’s a lot of really firm handshakes and claps on the back. But she was different. She came around the table, and I stuck out my hand to get the handshake, and she pushes it away. She gives me this really big hug. And I remember in the moment thinking: I’ve never gotten a hug at work before. [Laughter] Like, this is weird. We don’t hug, where I come from: construction.
But then here’s kind of the moment. And I don’t know if you’ve ever experienced this, but maybe your spouse or your mom or your grandma or somebody talked to you while they were hugging you—like, it’s a very intimate thing. You don’t really have any place to go. You kind of have to pay attention to them. And she starts telling me that I’ll never know what it’s going to mean to the people she’s going to go see, that she’s going to take it up into the mountains—Appalachian Mountains—here in North Carolina, and see people who don’t trust the doctors or won’t drive the hour it takes to get into town. And my stomach just went in knots, because she was so wrong. Like, I did know what it was going to mean to those people, because those were my people.
I grew up an hour north of town in the Appalachian Mountains. My mom: big farm family, one of 13 kids, dirt-floor poor. They slept four to a bed. My six uncles are chicken farmers. I had cow pastures on three sides of my house. We drove 10 miles on a dirt road to get to church. And so all I can think about is how I’d heard growing up that you can’t trust the doctor. “Don’t go to the doctor—they’ll find something wrong with you.” “You can’t afford to be sick.” “The hospital’s where you go to die.” And because of those attitudes, beliefs—core beliefs—both of my parents struggled with their health their whole lives: obesity, heart disease, diabetes.
And then, like I said, when my dad was 66, getting ready to retire, at work in a storage room by himself, he has a massive heart attack, dies—cold, dirty, linoleum floor, and scared to death, I’m sure, the whole time. And that’s not fair. He raised me and my brother right. He took care of what he was supposed to take care of. He worked hard. He saved. He did all the right things. He was a veteran.
And so when she’s standing there, she’s telling me this, all I can think about is: What if someone with her heart had headed up into our little town and treated my dad like a patient instead of a profit margin, like a human? And would he have maybe listened to the doctors, adhered to the medication, whatever it was, took the heart meds? Would we have gotten 10 or 15 or 20 more Christmases with him? Would he have met his granddaughters? Would he maybe finish raising me?
And so, in that moment, I got on fire, really, for this work. And I thought, “Well, this is what I’m going to do. I’m going to help people like her help take care of people like my dad.” And so I go to work. Like, I’m VP of sales. I’m going to do marketing. I’m going to figure out this market. And so I go, and I look, and it turns out, it’s a real market. It’s a big thing. There’s lots of people out there. There’s academic research centers. There’s hospitals. There’s health systems. There’s health centers that serve the underserved.
I was like: This could be a big deal. And really, it didn’t resonate with the owners there. I didn’t resonate with what I was saying. And January 10, I think it was, Friday afternoon, 2020, the owner comes in my office, and he says, “Hey, we don’t need you here anymore.” And I got a box, packed up my stuff, said goodbye to my team, and went home.
Loren Feldman:
Were you fired for some kind of cause? Was the idea that you had been devoting too much energy to this side project that they weren’t interested in and not doing what you were supposed to be doing? Or, how was that explained?
Travis LeFever:
No, well, it wasn’t explained, to be transparent. But I mark it down to vision, right? A small, family-owned business has a vision of what it is, wants to be, has been for nearly 50 years. And I have a vision for what I want to do with my life and what impact I can make in this world. And if they’re not the same, like, I’m not building Wienermobiles my whole life. That’s not it for me.
And the very definition of division is two visions. And I think that the further apart they are, the more tension there is in a relationship. And to be honest, it’s okay. Absolutely, they need to go be who they are, and I need to go be who I am. That’s what makes the world such a beautiful place. We’re all different, and we’re going to do different things. But then we came here, and so we incorporated the first week of March, 2020. It took us about three months. We cashed in our life insurance. I designed my first website. It was awesome. And we turned the marketing machine on.
And that’s the end of part two. Next week, we’ll be back with a brand new episode featuring a brand new addition to the 21 Hats Podcast team. In the meantime, my thanks to the entire 21 Hats Podcast crew, the 21 Hats community, and especially our amazing producer, Jess Thoubboron of Blank Word. Happy New Year, everybody!
