What it takes to run a business

Podcast

Last week, Jay Goltz continued his exploration of employee ownership, flying to Portland to meet up with Shawn Busse and Jim Kalb, a friend of 21 Hats who has already sold a portion of his business to his employees. The three owners planned to attend a conference promoting employee stock ownership, but things went somewhat awry. Jay and Shawn left the conference early, Jim canceled his flight, and as has happened before in his brushes with ESOP professionals, Jay walked away feeling convinced—convinced, that is, that an ESOP probably isn’t right for him. Two days later, we taped this podcast episode, which quickly turned into one of the more raucous conversations you are likely to hear about a somewhat technical business topic—although we did manage to find some clarity in the end. In Jay’s words, we agreed to agree.

Along the way, we confronted quite a few relevant questions, such as, do ESOPs have to be so confusing? Are the professionals who pitch ESOPs trying to make them seem complicated? If Jay wants to sell 30 percent of his business to his employees but continue running it, how much control would he have to give up? Will an ESOP make life easier or harder for Jay’s two sons in the business? Instead of an ESOP, could Jay accomplish most of what he wants to accomplish by setting up a profit-sharing bonus plan through his 401(k)? Hanging over the conversation was a larger, more philosophical issue: What exactly do business owners owe their employees? And whatever those obligations are, do they extend beyond the sale of the business? Do they extend beyond the grave?

This week, Sarah Segal tells Shawn Busse and Jay Goltz why she’s decided to take her public relations business back after selling it two years ago to a larger firm so it could handle the back-end stuff and allow her to focus on public relations. For Sarah, the immediate result of the decision to break away has been an exhausting few months starting over, including reincorporating, finding health insurance, and reducing her own pay. Meanwhile, Jay suggests an old-school marketing tactic that involves leveraging an envelope, a stamp, and the post office. And Shawn explains how he created a sales process that has allowed him to remove himself from day-to-day sales. Plus, a listener asks the three owners, “When do you know if you've made it? Or do you never know?” Shawn, Jay, and Sarah—three owners at very different stages of building a business—offer three very different answers.

This week, Shawn Busse, Paul Downs, and Jay Goltz go right to the bottom line. Shawn points out how easy it is for businesses to fool themselves into thinking they’re more profitable than they really are. Paul talks about how margins can vary from year to year, especially if an owner decides to invest in improving the business—as Paul’s doing right now. Jay says he’s long sought a 10-percent profit margin, but so far, he hasn’t managed to get there. Plus: Shawn explains how he solved his accounts receivable problem. And have you looked at the 401(k) accounts of your employees lately? If not, there’s a good chance you’re going to find that they’re not saving a whole lot. Is that just the employee’s problem, or is it also the owner’s problem?

This week, Shawn Busse, Liz Picarazzi, and Sarah Segal talk about how long to keep trying when a product isn’t selling the way you expected. For Liz, the problem product is her package locker, which is designed to defeat porch pirates but hasn’t really taken off—especially considering how widespread the concern is. Could the glitter-bomb guy be the answer to Liz’s marketing challenge? Or is it time for her to back off? Plus: In the age of Zoom and remote workers, what have the owners figured out about running effective meetings? And if you're pricing a range of services in a proposal, do you price your offering a la carte? Do you always charge the same prices? And is there a way to ease a client into a monthly retainer?

This week, in a special bonus episode, Michael Brown, co-founder of an innovative company called Teamshares, explains how he and his co-founders are bringing a fresh approach to a big challenge. Teamshares is buying the businesses of Boomer owners who are ready to retire but, in many cases, struggling to sell. Once the business is bought, Teamshares is turning the employees of those businesses into employee-owners, which is intended to strengthen the businesses while also addressing income inequality. So far, starting in 2020 and flying largely under the radar, Teamshares has already bought more than 60 businesses in more than 40 industries, most ranging between $1 million and $5 million in revenue. Along the way they’re learning some intriguing lessons about what it takes to build a business.