What’s a Business Transition Sherpa? Laurie Barkman sits down with Stephanie Scheller on the Behind The Podcast to share the backstory on her podcast and her business. If you’re a business owner, she’s a highly valuable listen for you, so check her out!
Transcript:
Welcome back, everybody. Stephanie, here we are back with
another one of our series here on behind the podcast. You know
me, I love digging in behind the scenes behind the whatever, why
does things work? Why do things work? That’s the question,
right? Because if we can figure out why it works, how it works,
we can replicate it for our business. Today I am joined by
the amazing Laurie Barkman, the Business Transition Sherpa. The
Business Transition Sherpa. I’m just gonna stop right there.
Because now I really desperately want to know, what does the
business transition Sherpa do?
It’s a lot of things, Stephanie. But at its core, it’s about
working with business owners to help them build the value of
their company. And then when they’re ready to let it go.
Now let it go doesn’t always have to be sell it right.
Sometimes it’s them like transitioning themselves out, or
am I going too far with that bad interpretation?
It could be any of those things. That’s right. That’s why I talk
about business transition pretty generally, you hear the word
exit or sale. And for sure, if you want to sell your company,
that’s a way to transition, you might also transition it to the
next generation of family or the next generation of management.
That’s succession planning as part of this, too. It’s kind of
a broad context.
Okay. So there’s, there’s a variety here. And I know your
official title is business transition, and M&A advisor with
lots of ads sprinkled in there, because we all need a little bit
of seasoning and flavor in our life. What is that? You said
it’s two designations, right?
Yeah, I talk about it that way. Because not everybody wants to
sell or buy a company. So the mergers and acquisition side is
very transactional. And this getting ready side is really
what takes a lot of time. If you’re building the value of
your business, you’re building a more enjoyable business to run,
you’re building a more successful platform to build
upon. So it just makes economic sense to build the value of your
company. And it doesn’t have to be because you’re going to sell
it. But if you’re understanding what your enterprise value is,
your understanding your differentiation, you’re
understanding the risks, and you’re managing all those
things, you’re inherently going to build the value of your
company. And so that way, it’s about building options and
generating options so that when you’re ready to think about
transition, you have different options to consider.
Now, I think this is where I think a lot of people don’t
think about selling or transitioning until they’re
frustrated with the business. Or a lot of people do think about I
know people think about it on the other side, too. And
they’re, you know, having done it for a while and very proud of
it. But I think a lot of times people go to I’m going to sell
this business because I can’t make it work. What do you do
when you do you get people to reach out to you and I get
people to reach out all the time, they’re like, Who do I
talk to you about selling this business? Because it doesn’t
work? And I’m like, well, you’re probably not gonna be able to
sell a business that’s not working. What are you doing? You
get that person who reaches out going, get rid of this business
for me? And you’re like,
Well, you know, value is in the eye of the beholder. Just like
if you have a house, what’s your house worth? It’s worth what
someone’s willing to pay for it. Just like a company, what is it
worth it’s worth what the market will pay for it. Because it’s a
private market, not like a publicly traded company, where
we know what that stock is, in a private company, its value has
any number of combinations. And so it’s in the eye of the
beholder. If a company is more risk associated with it, then
someone’s going to want to pay less for it than if it’s, you
know, perceived to be less risky. So it’s all relative, the
size of the business is definitely one of those things
that can be more risky, if it’s under 10 million. And I know a
lot of your clients and folks that you work with might be
under that 10 million mark. And yeah, that’s kind of a general
heuristic that a more established business by its
revenue, its size, and its back office capabilities, its team,
all the things that go into making that business
transferable. It’s about the risk profile. So what is that
future stream of future cash flows? What’s the predictability
of that? And what gives that possible buyer the confidence in
that stream of future cash flow? So if someone says my business
isn’t successful, and I’m having trouble running it, then yeah,
it’s inherently going to have less value to a buyer. Hmm.
So do is 10 million. I know we have some other questions we’re
going to get into but I’m fascinated with your answers
here is 10 million a pretty good like milestone for people to aim
for like, Okay, I want to sell my business. I want to exit I
know, I need to get it to roughly 10 million, is that a
general rule of thumb?
I’m not necessarily it can really vary by industry, for
sure. You might have a technology that is really
compelling and interesting and differentiated. And, and a
company wants to acquire it because they’re building on this
future potential think. Snapchat thing, right, right. Facebook,
Instagram. Exactly. Yeah. So it could be a situation like that
where it’s generating revenue, but it’s really about the future
of that business, it’s also about the profitability of it.
So in that example of texts are, sometimes it’s not so much about
the profits, it’s more about that potential. But then in most
businesses, it is the profitability of it. And so we
as we, as owners of our business, can, we make decisions
about what we want to invest in and how we’re going to focus our
time and energy and resources. And so if you are looking at
building the value of your company, you might actually have
less profits in a certain year, because you’re choosing to make
those investments that are going to actually increase your value
in the future. So there’s some crazy examples like, you know,
companies that run every expense, like every personal
expense through their business, like toilet paper. Okay, so you
saved 30 cents on the dollar, right? By from a tax
perspective, but you’ve hurt yourself destroyed your company,
your if the value of your company, let’s say is a 3x, on
average for your profits. So then you’ve lost $3 on that $1.
Right. So that’s the way we have to kind of get the mindset of
what does it really mean in value building?
So how did you get into all this? I know you have the
podcast succession stories podcast, we’ll talk about that
in a second. How did you get into this as your business,
it’s been a journey, they’d started, I would say, in 2013.
For me, I’ve had a career in marketing, and really fun
organization, startups, larger companies, and very
entrepreneurial environments. And in 2013, I was part of a
company well established 100 plus year old company, I was a
CEO of one of the divisions. And it was really exciting. And then
two years later, we were acquired by FedEx, you might
have heard of them. And it was, you know, this, this small
acquisition about a billion, billion, over a billion dollars.
And so going through that experience was something and it
was a family led company, privately held. And, and having
a front row seat to what that was, like on the inside of a
company getting acquired, got me interested in the world of
mergers and acquisitions. After that, I was with the company
went through the integration. And then after that, I worked
with a private equity group for a while. And then I was in
professional services. And I got to really understand this
landscape of professional services for business owners. So
it’s your accounting, your your wealth management, and then my
lane, my swim lane is growth. And so I thought, You know what,
this is really interesting. I’m bringing strategic planning to
the table, and I’m coupling it with the value building side. So
if you’re a business owner that saying yeah, at some point, I
want to have these transition options, what might they be, you
know, you didn’t build your business on your own. So why
should you plan to exit or transition on your own, you’re
gonna need people around you that can help you do that. So
that’s really the space that I’m playing, and is this business
advisory role to help you maximize the value of your
company. So that one day when you are ready to transition, you
have more options? And the other hat that I wear? Is this more
transactional? So if you want to sell a business by business, we
want to value your business. It’s really the first question
is, what’s your business worth today? Most people have no idea.
Or they’ll say, Oh, well, so and so’s sold his company for this?
So mines worth that? And the answer is no, it isn’t. We have
to really understand your particular situation. Because we
talked about those risks, you know, the risks and the value
drivers. So we take a look at that. And we say, okay, from
this starting point on the business is the business ready?
We also look at, are you ready as a business owner? So it’s the
personal readiness, the business readiness, and then the
financial readiness? And that’s the three legged stool.
That’s I love that you look at like, are you ready to because
I’ve seen so many people who go into these self destructive
spirals, when they’re no longer, you know, running and managing
their business because they weren’t ready their entire
identity was the business and all of a sudden it’s gone
overnight. And they are just, I mean, yeah, some really, really
crazy stories that have ended very sadly. So that’s awesome.
So what prompted you, because succession stories podcast is
coming up on its second year? Anniversary? What prompted you I
mean, I know you have plenty else going on your plate
podcasting. I think a lot of people think, Oh, I’m going to
start a podcast. It’s going to be like this really easy. Like,
I’ll just record for half an hour every week and it’ll be a
podcast. Like, it’s not it’s a whole thing and for the podcast
to be going consistently for a year and a half coming up on two
years. What What prompted you to go Oh, my God, I need to start a
podcast. And two part question. How do you balance that in your
business? Because a podcast is almost a business in and of
itself?
Yeah, it is balance. I think the vision behind the podcast was I
wanted to have a mechanism that was beyond the business card. I
wanted to have kind of this calling card for what is it that
helps an audience get to know me in an interesting and authentic
way and at the same time educating and providing value.
And then they also thought I thought about it as like a
highly curated referral network. So my vision was not to sell
ads, my vision was to have people come on the show that
either could have the potential to be a client, or to be a
referral partner. And so with the premise that this is a
business show, of course, we have human interest elements to
it. But we’re looking for interesting stories. And
everybody, I guarantee you, and guarantees that in the sense
that if you’re not satisfied, I’ll have another show for you.
My guarantee is that you’ll learn something. Now, you didn’t
learn something on this episode, you’ll learn something on the
next one. But it’s everybody that takes the listen to the
show. They’re always like, wow, I really took away a lot. My mom
who’s not a business person, listen to the show, of course,
and she gets a lot out of it. And so that’s good, too, you
know that it’s not, it’s not as the overly sophisticated
complicated thing. But you all can take away the human interest
side, too. And I think this the overall theme is transition, you
know, what inherently is succession, its transition. And
so we play that out. It’s about personal transitions. I had a I
have a sub series called The what’s next series, where people
share really personal stories about Yeah, maybe there was a
transition in business. But there’s also a transition in
life. I have a friend of mine from high school, who’s a former
NFL player, who was successful in business and, and he started
his own company. And I thought, You know what, I’m gonna have
him on the show, let’s talk about that. I have a gentleman
who’s a what I call a better printer. He’s a veteran. He was
in the Jag, and he’s now an author. And so we talked about
his experiences. And so there’s those elements too. But mostly
the shows are about business owners, entrepreneurs, founders
that are doing the hard work of the hard work. They’re trying to
work on their business. And there’s lessons learned of
what’s worked, what hasn’t worked. We have folks that have
sold their company bought businesses, it runs together.
So how do you balance all of that? Because you have to find
guests, record podcasts, get them edited, get them produced,
get them pushed out, get them marketed? Like there’s a whole
process here? How do you balance that in business? What is your
secret or, or key concept that lets you pull this off?
For a long time, it was just me doing all the steps except for a
few key pieces, which are really fundamental. One is I found an
excellent producer. And he and I created a really good workflow.
So I record and then he takes it from there to finalize, finalize
the elements. But I also probably should tell the
audience that I have 2025 years of marketing experience. So it
was different for me to market me and market the show and
market myself as the product. That’s different. I had to get
over that hump. But the mechanisms of marketing and
being comfortable in different mediums and learning different
tool sets. I was very comfortable with that. So it’s
been a challenge of how do you put it all together? And how do
you create processes that can that can scale and for a while,
I was doing literally every step. But I’ve tried to find
tools where I can automate. So that’s been helpful. And then
also, I do have a team I have added to folks, I use AI worker
as a platform, which is a B Corp to find folks in economically
developed countries. So I have a writer in Nigeria, I have a
graphic designer, in Brazil. And so they we have now we have a
workflow. And that’s been tremendous. That’s very, very
helpful. They’re awesome. So this, you know, this kind of
this team, if you will, I don’t outsource the whole thing, I all
sorts of pieces of it. And I maintain creative control. And I
like that I think it’s important for me to have that creative
control. Because I think about how a lot of these aspects tie
together. Maybe at some point in the future, I’ll be able to
outsource more of those. But because it’s a it’s a show that
is representative of my business, I am holding it kind
of close to the vest for that reason.
So if you could give one piece of advice to someone who’s
thinking of starting a podcast, while running a business, what
would it be,
to really process put process around it and I think where you
can add people to help you, you can find services to outsource
to the 100% if you want to, you could find you know some
combination like I’m doing where you can take it on yourself but
it’s really good to know what it is what’s your purpose, like why
are you doing what you’re doing? And then thinking about your
mechanism for consistency. So if you tell your audience you’re
going to do it weekly, then you got to do it weekly. If you’re
just too much for you then go to bi weekly or monthly but
whatever it is stick to it and come up with a process that is
workable for you if it’s creating you stress, then change
it Don’t Don’t drive yourself nuts and you know carve out the
time to it and and really have fun with it. I think the more
you really truly enjoy it, the better the product is going to
be. Love it.
Love it more if someone is interested in continuing this
comment With you, where do they find you?
Happy to do that they can reach out to me on LinkedIn, Laurie
Barkman. They can email me directly my email is lbarkman at
smalldotbig.com. And they can also hit my website and schedule
time with me directly, which is smalldotbig.com.
Fabulous. And we will drop all of those links down below for
you guys as well. In the meantime, as always, I want to
leave you with one piece of encouragement and the piece of
encouragement I’m going to drop you with or drop with you guys
today is this is that if Microsoft can still be asking
you to default to edge as it’s your default browser. You can
give your business one more go get at it today. You got this.
You’re gonna knock it out. Gotta be great. Make it an awesome
week.
