What Are The Five Stages of Business Scale with Casey Clark

Josh: 0:59

Good day, fellow dealmakers. Welcome to the deal scout on today's show. We're going to talk about like, when you're buying a company or maybe right after you bought a company, right? These PE groups out there, who you guys are right before you buy a company, what kind of team do you send in? Maybe internal, maybe you're looking for other types of partners before you make the acquisition. Is this a good deal, bad deal? What kind of opportunity? What kind of meat is there? This is the show you're going to want to pay attention to. With that, let's welcome Casey, to the show. Casey. Welcome.

Casey: 1:28

Josh. Thanks for having me.

Josh: 1:29

Yeah. Awesome. All right. I kind of let the cat out of the bag kind of talking about your, your super weapon here, but why don't you tell us about who you are and what you do?

Casey: 1:39

Yeah, happy to. We run a small business advisory firm. So I'm based out of Chicago. We've got a team of just over a hundred now, and we essentially go in and help scale organizations from the fast growing companies to the folks that are maybe on the treadmill that haven't figured out how to get to that next level in the business. It's an advisory relationship where we give them past entrepreneurs that work with them to help grow and scale the organization. Essentially if a company wants to grow or like you mentioned, kind of when you first started out, if they're thinking about buying company to help grow it, where the people usually get called.

Josh: 2:11

Cool. All right. We're going to get into the mechanics of this and we're going to talk deals and Chaplet, for the deal maker, there's always a deal maker journey right. Of how you got to where you are and what makes you the best fit to serve these audience members. Right. Kind of take us back, give us your origin story. How'd you get started in this game?

Casey: 2:31

Yeah. Happy to start in franchising of all things. Got my first franchise bought into a first franchise at 18 years old while in school, double dipped and ultimately built out and set some records in the franchise space. In terms of top production. I got tapped on the shoulder to start coaching these franchisees across the country. From there, I got tapped on the shoulder once more and let me buy in as a partner and essentially start to bring on the franchisees and scale the franchise organization. All I did was take mostly first-time business owners and teach them how to grow and scale an organization. I did it over and over again for a decade. What you learn is that the widget is an important, the service is an important, it's the fundamentals of how do you scale an organization right back to the basics of recruiting leadership, sales, marketing, productivity, financials. Those are the elements that most people don't skill themselves up and as an owner. And so I became obsessed with it. I became absolutely obsessed. My co-founder and I, when we're looking in the market, we read this article by Forbes. I wish I could find it, but I haven't been able to essentially like the top five industries that expects, triple digit growth for the next decade. And it said coaching, business coaching. We looked on LinkedIn at the time, there was just thousands and thousands of business coaches. And we saw one thing in common. Almost all of them had never ran a business. They were business coaches and still to this day, I mean, it's still like 70%. I'm not saying you can't be a great coach without running a business. I'm just saying to get to the level of depth we wanted to go. We were shocked by that. We said, we're going to take all this we've learned in this franchise company, we're going to move it externally, start to partner with folks. It's, I mean, we started it back. Part-time in 2014 for a couple of years, 2016, we started hiring, like I said, we're, we're a hundred plus driving all across the country. I've serviced over 2000 businesses. It's just been an epic fast-growing ride. So having a lot of fun,

Josh: 4:24

Awesome, 18 years old, but your first business, how in the heck does an 18 year old focus on that rather than all the other distractions that come in? How does that happen, dude?

Casey: 4:36

I'm not going to mention this gentleman's name, but the person who brought it to me showed up to a party that I was at and brought a briefcase with $10,000 in it. Now the funniest part about this right is open that briefcase. If anybody's ever done this $10,000 is tiny. It was like this little tiny stack inside of this big briefcase, but he looked, I was at a fraternity. I was a part of a fraternity. He just goes, Hey, look, I've got this really unique home service franchise opportunity. You buy a business, it's risky. If you're an entrepreneur at heart, I was an entrepreneurship major, by the way. If you want to run a business, we'll teach you how to run it. And you've got to interview. You're gonna have to put some, some collateral down, but we'll take a look at it. And if you do well, you'll make.

Josh: 5:25

This briefcase, you're.

Casey: 5:26

Gonna have this. It was like, it looks got a weird, so, but that was what, that's, what started. I'd ran a lot. I'd ran a lawn care company, junior and senior year convinced some of my buddies to use their parents' mowers really cheap way to get a lawn mowing company off the ground. It was servicing about 35 to 36 yards every week. Did that to get money, to go to college, I'd run up, with my dad, I was rollerblading paper routes when I was nine and 10 years old, waking up at five in the morning. It's just kind of in my veins from day one.

Josh: 5:56

Roller played in Chicago. Isn't there. Okay. Where were you?

Casey: 6:00

I was in central Illinois. Yeah. It was in Decatur. I went away. For anybody who knows that city it's, it's the armpit of the state of Illinois. Great people, but just not a lot going on down there. Yeah.

Josh: 6:12

Yeah. It's funny that you mentioned this guy shows up with a briefcase. You're like, oh, what's in the briefcase. And he opens it up and ,

Casey: 6:23

Why are you showing me this? But it worked. He knew what he was doing. You knew I was glued. I went to the interview. I remember, I got, I filled out the application, got accepted, puts a little collateral down and away. We went,

Josh: 6:34

All right. You and I are hanging out, we're going to a coffee shop. We're going to, we're hanging out in Chicago, but we're going to do some recruiting. Will you ever use that tactic where we create.

Casey: 6:47

Absolutely not. If I want to convince an 18 year old to start washing windows and painting houses. Yeah, I might, but probably not for the world I'm in now these days,

Josh: 6:58

The briefcase gets bigger, maybe with more bills in it,

Casey: 7:02

Hopefully, hopefully you have more of a living wage attached, but I'll tell you why. I did, I, my first year Josh brand franchise, I think I made a thousand bucks. I did not make, I was a big business. Like I did really well. Didn't manage my money. I mean, part of why I think I have this company now is like, I didn't get it right away. I actually, I could reduce revenue. I could structure deals with clients all day, but when it came to producing and leading and creating the systems, I struggled massively. Second year I came back. I was one of the most profitable why margin percentage? Because that's all I focused on 30 year. I put all the work I put in the first year. The margin excellence my second year. That's when I was setting all time profit records. I was 20 years old making six figures in a summer, leading 40 employees. I mean, it was just, it was true grit that got me there. Thank God that guy showed me a 10 grand pretty case.

Josh: 7:50

Yeah. Super cool. Now you kind of give the entrepreneurial journey kind of summed up into your first three years into this, the first year, the struggle, the hustle, man, I'm working my ass off thousand bucks. You're like, are you kidding me? Most people call it quits their second year. You're like, all right. Systems, processes, operations third year roofing, the fruit right. Refund. Yeah. If you could tie those both into the first two steps right now. All right. So you did that. You figured that out. What kept you from quitting year one? He made a thousand bucks. That's not enough for a couple of packs of Natty, right? That's it?

Casey: 8:32

Yeah. I mean, it is a lot as a lot of years ago. I think if I really reflect back, it probably comes down to more of, I think I knew it was me is pretty apparent the nice part about a franchise system, right? It's like you're watching a bunch of other people run the same business in other markets. You can look across and go, you did less than me and you made 20 X to me. I don't. Y so at some point, yeah. Are you able to look in the mirror? You're able to be introspective is one of the first things we qualify when we look to bring somebody in our portfolio is we take a look and go, is this owner truly introspective? Or is there an ego? I think luckily my parents had grew me in a way that I was able to look in the mirror and go, all right, I've got a skill up on these things. If I really do want to be an entrepreneur, I've got to look past that. I think a lot of owners struggle with that. You need a lot of confidence in ego to jump off that cliff and build that plane on the way down. You also got to know when to go. I didn't really build this, right. Maybe I should pay attention and fix stuff with me first.

Josh: 9:28

Oh man. What a, that's a personal journey accomplishment that you have to go through. I think as an entrepreneur ego and grit, p**s vinegar, fire, right. That gets you going where you need it. You need it.

Casey: 9:42

Yeah.

Josh: 9:43

To break through that next level, you have to be humbled. Right. You have to go, I need help. I need advisors, coaches, mentors, people, I don't know.

Casey: 9:53

And I was 18, right? Like, let's be honest. Right? The resiliency of an 18 year old versus a 40 year old is just very different. It just is for most, I think. Part of that also probably just kept me moving, kept me grooving. I think luckily I was able to realize at that point, this is a me issue. I, and it was of a, I think I'm motivated by I'm gonna prove you wrong. I've always generally been the underdog, never been super skilled at something I've done. I've always had to work it. I think it was just like a normal part of who I was and what my DNA was it to a bed.

Josh: 10:26

Well, let's be real, bro. Like you, you were a rollerblader. Like you could have been a world famous rollerblader. Hey, to stop man.

Casey: 10:34

Let's I did own K2. Surprisingly, I love that. You said let's let's think, let's think it for both of us that's not what happened. Professional role. I just, I don't know if I would have gotten the sponsors I needed to live financially.

Josh: 10:53

Do you have a pair hanging up on the wall that one day you might break them back out again and do.

Casey: 10:57

I got to say I, that I have a almost three-year-old at home and the moment this kid had to, I went and found my roadway and I went and bought these kid roller blades. That he outgrew in like less than a month and I immediately got him on and he's like step around on it, for sure. Passing on the rollerblading. I grew up playing hockey. So that's where it comes from. But I'm so.

Josh: 11:19

Happy though. Right in the summer.

Casey: 11:21

I played ice hockey. I played ice hockey, but oh yeah. Roller hockey with the friends out in the street, man. We're going way back, Josh. You got me in my childhood here.

Josh: 11:27

Yeah, bro. I'd knocked out my first tooth playing roller hockey.

Casey: 11:30

I'm sorry to hear that. That was an epic slapshot at least. Or was it just like a fall on your face?

Josh: 11:35

Yeah, it was a fall in the face. I was going for it man. And some dude tripped and Tommy. Oh, far freaking from south Florida. Tommy. Oh. Far trip meets the mouth. God gone anyways. Wow. That's a flashback. Thanks for that buddy. All right. So let's do some compare contrast, right? This let's just call it. I don't know if I named the three steps, but let's compare it to companies now today. Right? The, the first year of the grit, like phase one struggle hustle.

Casey: 12:08

We have actually five stages of the business. I don't know if you knew that Josh. Oh, we, we actually break down into five stages of the business that we've seen. You might I'll just share them with you.

Josh: 12:18

I'd rather you do that because you already created, I was pulling this out of my butt. Go for,

Casey: 12:22

Oh, we, this is one of the ways we break down a business to see where they're currently at. So yeah, you've got the hustler. That's the first stage is actually the term we use. It's the hustler. It's the person who's usually, it's their limited resources or trying to build with contractors. Maybe you have a small team, but it's really like, the only way to get out of that stage is to hustle out of it. Yeah. Right. You can get more money, but if you don't hustle, it doesn't matter. Number two, we then move them into the experimenter stage. This is this is the stage where they're experimenting where they're saying yes to everybody, right there. A lot of times, right there saying yes to everybody to recruit they're they're hiring. They're more attracted to entrepreneurs. If they're hiring, trying to get people to wear multiple different hats. This is where they're learning like, should I really be the CEO? Should I hire a CEO? Like what, how do I scale this thing? They're just experimenting constantly trying to figure out the processes. Once you start to get that locked in a little more, you move into the visionary stage, where you start what it is, right. You start casting that vision out. You start going, okay, I'm going to go create X, Y, and Z. You start to learn how to tell the story and how to tell the narrative. You learn how to get people to follow you. That's the big step that most people don't ever fully get to is what we find. That's the biggest hurdle of why you see so many businesses still failing, despite more capital, more technology, more incubator system, coaches, whatever, more resources than ever before yet, there's almost a worst failure rate. There was a decade or two decades ago. It's because you have to have that innate ability to create that vision. You have to see the future to get people, to come follow you to that direction. That's really exciting time because for the first time in visionary states, you start to move away from your customer. You stop looking at your product or service and you start looking at your team as the business. That's a massive transformation again, where most people are going to get caught up. You want me to stop there? Josh? You want me to finish the last two.

Josh: 14:13

For me? Moving away from the customer, right? What the awesome. All right, this is so cool. You said this is the biggest hurdle before we dive in unpeel, this onion right here. Let's go. What are the other two steps? Just in case I don't ask you the question.

Casey: 14:30

No problem. The next one we call it the systemizers. This is where exactly who you're hiring. Exactly what you're in, ideal client, persona ICP in the language you're looking for. You're, you're tying it all in. This is where you start to bring in that leadership team. And you start to systemize. You're no longer hiring, the Swiss army knife, the Jack of all trades, you're actually hiring specialists. You have totally pivot who you hire because they have to be comfortable not being rude, but just, they have to be comfortable being a cog in the wheel. You're going to scale to a size where they have to be comfortable. This is my box. This is my widget. I'm the best at it before you wanted people like I want to dabble. I want touch a lot of things and wear a lot of hats. You have to shift your hiring profile and you have to learn how to lead through other leaders. That leads you to the final stage, which is the influencer. I'm not talking about on Instagram, I'm talking about on a leadership photo. I'm talking about influencers, a leader to go realizing you're going. I no longer making the decisions of this organization. I've gotten to a play. This is what people would, they, they they're going for, right? Like if I could create a passive business, it truly like continues to scale people that are driving the decision, the board, the moving to the board, or, a, a remove CEO that can take as much time as they want and spend with their kids and family. The influencer, the way that you get to that level, as you've brought in so much talent, you've developed these leadership systems, you put all, and I'm not talking like policies and procedures. I'm talking about like tech enablement, really putting the guard rails into where things can not break. Right? As it's scaling, you're now influencing the decisions in that role. You're no longer driving the decisions. That's again, a hard place where people don't give up control. I've seen so many people build to, revenue's not always a good indicator because it depends on the widget, but I've seen people build 20, $34 million companies and they can't ever leave the moment they left. It drops. It's actually because they never taught the leaders how to think for themselves.

Josh: 16:22

Yeah, bro. We gotta go back to like step number two. I'm glad you made up these steps because I just like, I made it up on spot.

Casey: 16:31

I like keynote on these steps, man. I get hired to speak about this. Thanks for not researching me to know that I have these five steps and letting us impromptu bring this up because it's fantastic.

Josh: 16:42

Maybe I was acting. Maybe I knew that. I didn't do it. She just called BS on me. All right, perfect. With this hustler, experiments or visionary, systemize or influencer, we should do a keynote on this one day when it comes to the visionary step, you said, this is the biggest hurdle, right? Getting people to follow you and right. Moving away from the customer, right? Like this is counterintuitive. This is my baby. I built this thing. Blood, sweat, tears, three divorces later. Right? I built this thing. There's no way I'm going to move away from my customer. I know best. There's no way to step into that role. How in the world, first of all, when you're looking at a business to work with or not, how do you decide to say yes or no to someone to take them on as a client? Is this one of the determining factors? If you don't think that they could do this, you go not a good fit for us.

Casey: 17:39

Not always. I mean, our vision of the company is, the world made better by entrepreneurs. For us, we would feel like the mission draws us, that we do need to try to help them get to the highest level. The difference, how I would answer that question, Josh is when we meet them, we make sure that what they're aiming for, like what the stage they want to work towards is in line with where we think they're at, or they're clear of what it will take because so many people have these visions and goals and they're just abstract. They're not actually locked in any type of logic or skillset. So we do a really good job. At least I think we do a really slowing down and breaking that down from going, do you realize this is what's going to take, right? We get into all the analytics and get all the data. I mean, we're data junkies over here, cultivate, but we pull all that out. The biggest issue, Josh actually on this step specifically is actually that most people think they're at this stage way before they actually are. Every time I do this keynote and every time I get on this topic, every podcast I've shared this on every single time people start commenting, like I'm a visionary and you'll look at me like I got two employees. Like you're not there yet. Like that doesn't mean that you're not, you can't be a visionary, like have a vision. It's just this stage you really have got to be the point where you're starting to get pretty overwhelmed or like you're busy enough leading a large enough team that you don't even have time to go to the customer. In fact, if you are, you're actually only holding back the company at that point. We would see that very clearly when we'd go in to do our big analysis and break down the business. Yeah, I mean, I think at a high level, the thing that people make the mistake on is some people like to have a business they're in control of they like the day-to-day. They like the work itself. That's why they built a business. You don't need to have a vision to grow and scale pass. You can still get it to such a clean way to where, when you're ready, you can exit and get such a great payout for your work. I mean, I know you, Josh, you've talked to so many entrepreneurs, we have this really weird, unique lens with the thousands of businesses we break down every year that we take a look at. The unique thing is just cause you're a 30 million, 40, 20 million company, whatever it is that doesn't mean you're more profitable than a $6 million company, right. It doesn't mean it's not built better. You've just figured out how to drive the revenue engine. That's one part of the business, right? In terms of the health and when deals are done and we help, PE firms or these new sponsor folks go in and acquire often, let's what we're looking at. We're going like, Hey, it looks cool. Deep down, there's a lot of work to do to get this really cleaned where, a sustainable growth is different than just a hardworking junkie at it. Yeah. So yeah.

Josh: 20:17

Well that was a little convicting on my part, but that's for going through great. I'm the, I'm the hustler, right? I've been on the hustler. I've made it to the experimental. I've almost Crested this, I would call myself a visionary. I took the test, right. Vision integrator. We can talk about EOS and is that I'm a 96% visionary, but you're saying that not quite there yet in terms of business growth, and I'd love to hear your thoughts on how you guys play in the ecosystem of EOS and you guys sure. When you're talking with a business owner right there, you're kind of looking at them through this lens of five stages of where the business leaders at, right. Amber, the businesses at, have you ever found that a business leader is playing in a field? That's, the company is ready for an influencer, but they're still playing at the experimenter.

Casey: 21:13

Oh yeah.

Josh: 21:13

Let's address that.

Casey: 21:16

You call the elephant in the room, right? Because, because we're one-on-one advisory and this is unique. We don't take equity, we're paid adviser. That's very unique that you can get the level of advisory we'd give without the equity side, when we're in there, our position is always for the benefit of the owner. We're looking at that owner and we're talking about the business, we have no problem having an open conversation to say, we need to really slow down and figure out, does it make sense that you are the scaling CEO or is there a different role you want and when you slow down and what we're, what we can do is because we see so many businesses at different stages, we can help paint the picture. This is how this will be. Are you excited about that? Do you want to work that many hours? Is that what you built this for? Why did you build? We tap that in, we know how to do it in a way that opens up the door to make people go. Actually, I'd rather just sit on the board. Yeah. That might better for you. I'm like, let's talk about why. And so it depends on the business. Depends on the person, but I wish I had it more cool answer than that. It's we talk about it and we're not afraid to have those really hard conversations and we will.

Josh: 22:22

Alright, you, me and entrepreneur that we're going to go have a chat with what's the most awkward kind of elephant in the room you've had to talk to, especially after doing this, with a thousand different companies, you me going into the board room and you're like, Josh, this is going to be awkward, bro. You said it, what was the most awkward thing you had to approach elephant in the room?

Casey: 22:45

I gotta be careful on the confidentiality side of what I share, but I can tell you one story that I know this person will won't mind, but I'm will not share the client's name. Okay. So I was sitting in the room. I didn't know it was gonna be awkward. Sorry, I couldn't have proactively told you this is going to be awkward. We're sitting in the room and we essentially uncover that the owner had convinced an employee to not take payment and to create a personal loan back to the owner. You think, okay, maybe you did that for like a month when you first getting started. Like, no, like it went on for like six years. By the time we got through the conversation, we'd realized how much in depth this person was. They didn't track it. The employee had one idea of what that was worth. The owner had another idea of what it was worth. We're in the meeting with the owner and the employee when it comes out and we just were sitting there going on, how did the, I mean, first off, let's just acknowledge, this is a legal, let's just acknowledge. This is illegal, right? Like this is, you can't do this. It was the most, it was, I won't even tell you the amount. It was huge. It was a really crazy what a bankrupt of the company we ultimately worked through. It took us about two years, but that was one hell of an epic, awkward conversation I've ever been in hands down. I've never felt as awkward as I felt in that meeting. It was weird. That was a weird one.

Josh: 24:10

That is weird. All right. So no, you shouldn't do this. Not good illegal, but that the owner and incredible salesperson. Right? Holy moly,

Casey: 24:24

Baby.

Josh: 24:25

Right. So bad. No don't.

Casey: 24:28

Yeah. Well we'll talk further about it.

Josh: 24:29

Yeah. Okay. So interesting. Thank you. I appreciate you sharing this because here's the thing, man. I'm an entrepreneur through and through. Right. I used to, my dad was in construction. I grew up swinging hammers, not the smartest guy. I wasn't the smartest guy, but I would sell the wood out of the dumpster, the kids down the road for skateboard ramps and roller blade. I'm always, I was always, selling stuff, always building stuff, always building a business, but I'll tell you, man, for someone to, walk me through a business. A lot of times, for me, pride and ego prevents me from asking for help and taking a look and say, Hey, Hey Casey, will you come take a look at my business? I need help. I've had to learn this in my I'm not 40 to go. I want you to, because they, mistakes are now costly. And I have three kids. I have a lot to lose right now. As the businesses get bigger, more revenue comes in. I have more to lose. I want to be careful about this. Right? So asking for help. When do entrepreneurs go, Casey red flag, I need help, re wait to flag SOS helped me. Why did they reach out to you and how.

Casey: 25:39

I'm gonna let you know, a little dirty secret?

Josh: 25:40

Okay.

Casey: 25:42

People do not search for what we do on Google. I know cause I've paid Google a lot of money and they don't come through. And, and the reason for it is what you just said. We've gone out and pretty much realized that people owners have this innate gene tore they'll naturally want to figure it out themselves. Yeah. What we've learned is we had to build this business purely from referrals. That's how we've done it. We've built it purely out of referrals. We let business owners go tell their story to their friends that are other business owners and they go, wow, I want that. What we had to do and what really may have helped us scale, the level we did as fast as we did is it really came down to our ability to offer. We give free time. We essentially will say, Hey, we're going to do a formal assessment for free for you for a couple hours to break down the business. And you steal all of our ideas. Most we know this most come into that session and have no intent to hire us. We know that they actually come in just cause we peak their interest to go, well, how do I know what I don't know? By the time we're done asking as many questions we ask and showing as many gaps. We show it's usually at the end going all right, let's go, let's get started. I'm just going to cost me. Let's get into it. We've really just kind of in brief, actually just embraced what you said and built our business around it versus trying to figure out how to get people to say I'm ready. Because what we found is they're not,

Josh: 27:06

Yeah, not, it feels like going into an exam with rubber glove and you're like, oh man, this is going to, I know this is going to be scary. It's going to hurt. Right? Like let's get going. Cause I want to move past it. Right. Cause my vision of why I'm doing this, the purpose of the podcast shows the businesses, that things that I'm trying to learn and invest in is greater than my pain today. I know that the next step of growth for me, personal growth is painful.

Casey: 27:35

Josh has got advisor can help you with that.

Josh: 27:39

Got a hundred for me to choose. I'll take this one in this one.

Casey: 27:43

Josh in all seriousness, like what you just said, those still like again, most people come in excited to do the assessment with us because they want to prove us wrong.

Josh: 27:53

Yeah.

Casey: 27:55

It's just a good lesson for entrepreneurs that are listening today to go like step that back. Some people are like, I guarantee every entrepreneur is like, I bet this is good. People are listening to, this is probably helpful. This is not me. I just called out like half the entrepreneurs listening to this podcast right now. Right. They're like, that's not me. It actually probably is you like, you probably generally are not the quickest to ask for help. You're you're more likely to try to go at it and fail because you're the person who can run through brick walls so many times more than others. That's why you've gotten where you have as an entrepreneur.

Josh: 28:24

Yeah. To be honest, man, the run into the brick walls and such like that's this p****d vinegar, the fire, the energy that gets us going. When you're, get into your thirties, you start to slow down and then you wind up in a hospital and you're like, oh, am I having an ulcer and heart attack what's going on? Right. And then you get into your forties. You're like, I got kids that are getting an expensive, I don't want to make those mistakes anymore. Right. Is that called wisdom?

Casey: 28:51

Yeah.

Josh: 28:54

Okay. All right. So, so with your system, right. You said, Hey, widgets, gidgets product services, not as important as fundamentals of business systems, processes, those kinds of things, these fundamentals. You talk about this, how does this play in the world of, and here we bring up some of our friends that we both know the world of EOS entrepreneur, operating systems, visionary leaders, E-Myth revisited and bill Gerber and his groups, right? Like where do you play with them?

Casey: 29:25

Yeah. I can't speak to E-Myth as much for the book, but let me speak. I can speak to us. One thing that you said it was, I'm not saying that the product in widget isn't as important. What I'm saying is that often people can have a good product or good service. It doesn't mean there'll be able to scale if this also isn't there the same as us, if we don't think the product or service is good, we're not really that interested in helping that company scale it. If it's not a good product or good service. They both do have to be there just to be clear. You S obviously they have one of the best leadership, operating systems. You can, you can put into a business, I'm a big fan of how it works. And, but, their model is they're going to help you implement that system into your business. That's the one system in your business. The problem is when you set the goals and you set the, the objectives out EUS doesn't come in and necessarily help you solve, like, okay, how do you re, cut and re automate a recruiting structure and a full system and tech enable it and build it in a way that's actually going to produce the highest top candidates that are going to retain for, for years and years, and not have a high attrition rate. They aren't going to go into that conversation. They're going to help them identify what's on the roadmap. They're gonna help them put together and get the team working together in driving in the same direction and amazing operating system all day. And they'll give you the right mindset. When it gets to the nitty-gritty implementation of like, how do I build this? It's not there. EOS and cultivate work well, hand-in-hand a lot of our advisors have had us implement their businesses. We've had a great experience with a few of the folks that we've had partnered and shared across lines with, because it's just been, yeah, you're building that. Awesome. Perfect. We bring in vendors all the time, no different. We're going to go way deeper to help make sure it truly, the goal is then hit and that they know how to implement all the way, not the operating system, but the widget or the item, or the metric of a KPI that they're focused on.

Josh: 31:13

You guys are taking a look at the business and when you approach a business, right. I go through your analysis, your initial exam, right?

Casey: 31:21

Sure.

Josh: 31:23

Assessment, you guys take a look at the business and you go, boom, boom. You're looking at it through a lens of, are you D are you looking at the different departments? Are you looking at the different pillars? Do you guys have, like, I didn't research you by the way, did you go.

Casey: 31:37

So I can tell you that. I don't even think, I don't even know Josh. If you went to my website, if people are curious in our methodology and I think it will help, you can jump for our website and cultivate advisors.com. That's my only shameless plug, but on the website, you'll see a propeller methodology. So we operate on the propeller. We believe we can propel your business. If you look, the financials is the engine. You have sales and marketing. That's on the growth side. Those are two of the blades. You'll have leadership and recruiting on the capacity side. Okay. The encasing around the propeller is productivity. And that flows all the way through. The idea is that productivity, that's not just calendar, right? It's like tech enablement. Systemization, that's all around marketing sales. It's all areas. Financials are the engine. All the blades run back into financials because ultimately the budgets and the money without the money, you're, aren't going to be able to grow those areas of the business. What we really focused on Josh, when we do our assessment is we're breaking down the business in pursuit of, five, 10 years, whatever the growth objective is, or exit ready, depending on what the situation is. We break these areas down. Think of it as simple as all right, my financial engine is a four out of 10. My sales blade is a six out of 10. My marketing is a two out of 10. Well imagine, would you get on a plane? If you're a propeller, look that wonky, you have this small little engine, a big sales blade, a small marketing blade, a bigger car. You wonder why you're going to hit turbulence. We have any aircraft engineers here. They're like, actually you'll die. Don't get on the plane. Really like, this is why businesses hit turbulence. This is why they can't, fuel enough to get to the next landing spot, to the next destination. We find that analogy really helps our owners. It's a way we can help articulate the areas we want to focus on. We believe those six areas is what really drives growth of a company outside of capital and a few other areas. There's a lot of amazing vendors that'll solve that for you.

Josh: 33:33

So, all right. This plane, how did you come up with this? You probably have it on your website that I didn't read.

Casey: 33:41

Okay. So, really when it came down to is that we didn't start the business with this methodology, we started working, we probably up to maybe three, 400 companies we had worked with before we started seeing the similarities. We kept realizing it came down to the financial engine, was off the pricing per widget was off the margin, allocation was wrong. The forecasting of cashflow was all off. We started looking at sales and realizing, okay, half these people have CRMs set up incorrectly. I don't even actually know how to drive data. They don't how to build a sales team. They don't have a structure of the sales structure to create the growth. It just, we just kept coming back to these six over and over again, it was consistent. That's when we realized these are the six lovers that dictate. I mean, look, our average client, our portfolio grew by 40%, top line and 60% bottom line last year. I mean, we get epic growth if we work with you. We're doing that, were able to see, these are the six that were driving. It, it wasn't product innovation. It wasn't as much as operations that usually works itself out. People generally rise to the demand. It was these other areas that people don't spend their time on.

Josh: 34:47

What was the hardest out of those components of the airplane? What were the propeller, what component did you have the hardest time overcoming for your business?

Casey: 35:02

Well, depends on which business on the, in my franchising days, it was leadership and financials. I was a terrible leader. Didn't understand what it meant. First time out of the gates in a formal environment and on the financials, never paid attention to it. I just assumed money's coming in. It'll work itself out as the black hole that I know, 80% of other entrepreneurs, thank God for outsourced CFOs. Just the, the, the black hole that would be created on the financial side was, was my approach. This business, I've had, it's probably been more the marketing side. We don't do a good enough job telling our story, not a success that we have in the amount of output. We don't, we don't, we're still learning how to tell our story the right way. I have the least amount experience on the marketing side in terms of the B2B company.

Josh: 35:50

Yeah. If you were a baseball card, like you're a baseball player, but it was for the business. On the back, there were some stats or professional rollerblader. On the back, that was your business stats. What is your grade, your personal greatest business skillset?

Casey: 36:10

Can I share two or do I only get one?

Josh: 36:12

Ooh. All right. I'll give you a.

Casey: 36:15

Skillset, right? Yeah. We're looking for skillset. Yep. I'm very similar, Josh. I can, I gotta be careful. I can sell anything to anyone.

Josh: 36:24

Yeah.

Casey: 36:25

That's just, I was born with it and I've harnessed it. I love digging in on how to increase the conversion rate. I mean, it's into my last business and then this business, I mean, if I don't close 85 to 90% of meetings I have on p****d, it just, I expect it. So that's one superpower. I call these superpowers. The other superpower is I am absolutely a builder. I simplify and see systems 10 times faster than most. I, I can put together something that seems very complex and present it in a very simple, unique way at rapid speed. Certainly what we're doing today. Right. Just breaking things down in a simple way to understand a business structure, this, that's my second superpower. It definitely helps me in a role of advisory. Yeah.

Josh: 37:14

Superpower, I like how you say that I use something similar sales, right? It sounds like you're a competitive guy too. Right?

Casey: 37:23

I might be. I.

Josh: 37:25

Might, I might be the most competitive person on this show today. And then also the builder. Right? I think let's pick one of them. I believe with every superpower, there's a, a weakness or a gap, a kink in the armor. Right. What would you say? You could pick either one of those, but what would you say is a flipped?

Casey: 37:43

Yeah. On the leadership side, when you are really good at sales and you start, I have multiple layers of leadership. I have multiple business units because we have acquired a company. I have been told in 360 feedbacks my entire career that I can come off manipulates. Cause you don't know how to turn off the sales. Yeah. You don't know how to turn it off. It's like, I, I mean the conversations I have with my wife, you don't need to sell me Casey. I, he was like, I know I'm not trying. I actually am not trying to, I just sound very convincing and very confident, but deep down, I'm just having a collaborative discussion with the baby. Like it happens all the time. That is, that is part of that's. Yeah. That's, that's the Achilles heel to the superpower. No doubt. Yeah.

Josh: 38:25

Yeah.

Casey: 38:26

Watching, like.

Josh: 38:27

I'm thankful. So how do you keep the boundaries? How do you, how do you keep guide rails for you to one stay in your lane of, in your skillsets and your strengths, and then also to make sure it's in a way that it's healthy for the organization for you personally, like what guide rails do you set up for yourself?

Casey: 38:50

I'm not going to answer that question. I'm gonna do it a different way instead of guardrails. Yeah. I'm gonna say here is a tip that has helped me manage it.

Josh: 38:59

Okay.

Casey: 39:01

Complete transparency when I take on new leaders or if I, if I, whatever the situation is, it's an open conversation within the first couple hours of having meetings with that individual.

Josh: 39:14

Yeah.

Casey: 39:15

Hey, you're going to feel this way. Sometimes. It's not me. It's not my, actually my intent deep down, I am really interested in your ideas. I'm going to sound very convincing. I need you to share your ideas. I need you to, like, I just get really passionate. I get really excited. And I, I'm a solver. Know that about me and let's talk about how we can best work together. Now you tell me what's going on for you and how do I, how can I try to approach you differently? That'll get the best for you. For me, it's more of a tip more than a guardrail because it's an eight, like, I don't know how to stop it. I've tried. I tried doing that. That didn't work.

Josh: 39:53

See, I would, for me, like, so I tip on from my, from my weakness and strengths is I have to stay super transparent because I too am a sales person and influencer. I'm a master of being able to crack open groups. I could posture like the best of them people. I was going bankrupt and people were still asking me to invest in their multimillion dollar fund. I've had to unwind that and unlearn that and go, all right, open kimono here I am transparently those who still like what they see. We'll wind up doing some level of business together, but transparency for me is a mosque. Otherwise I get, I lose focus, dude.

Casey: 40:38

Makes sense.

Josh: 40:39

Yeah.

Casey: 40:40

A lot of people are in that same boat, Josh.

Josh: 40:42

Yeah. Through this, and the reason we have podcast shows, the reason we do these interviews, I've interviewed a thousand entrepreneurs. I ask these questions is because there's a story behind the dealmaker. For me, man, it's great coaching for myself. We accumulated our knowledge, wisdom, and network, but it's also sometimes therapy. Cause I get to like learn and grow and have you fixed me? Why we're talking. I appreciate just being open and telling me about that. That's very courageous of you.

Casey: 41:14

Yeah, absolutely. Josh, I think that's the coolest part of what we get to do as advisors too, because we learn from our clients every day. Yeah. We cause we're helping them solve what they're not good at, but we get to see what they're amazing at and go, whoa. Okay. I'm going to put that.

Josh: 41:28

Yeah. Isn't that cool. When you get to see someone like when you, I mean, this is your curiosity, but when you dig into a company and you get to see their skill sets and strengths and such, and maybe they're not in the right seat, the good to great kind of thing. You're like, Hey, great leader. Maybe hear that, like you get connected with the leader and you build a relationship and then you become attached. How do you, how do you still maintain the ability to call out elephants in the room after you've grown attached to someone and see their mission? You're like excited about it and in even prevent yourself where you're like, we don't take equity and you're like, I really liked this idea or this deal, or like, how do you set up those guide rails or tips?

Casey: 42:12

Yeah. It's, I mean, talking about attached to your Josh, like it is my, I am married happily with kids and I met her. It's my it's my, it was my client. Sister-in-law. I've had stand up at weddings. I've, I've gone on world travels with some of my clients, before the scale. So you're absolutely right. This happens. The, the relationship was founded on a goal. It was the goal cast by the entrepreneur when they walked in our door to say it. That goal doesn't always have to be revenue profits. Sometimes it's like, I want to work 25 to 30 hours a week and have a life when anything's, when everything's in pursuit of that goal is the easiest elephant in the room conversation to have it is the absolute easiest when the goal is set. I think once the goal is lost because the relationship is overcome, you have to go back and capture what is the goal? The elephant in the room conversation is extremely easy. Most people just aren't truly dialed into what the big picture goal actually is.

Josh: 43:19

Super cool. Now hundred people, business advisors, you guys are growing rapidly, hit Inc. All sorts of times. Right. And you guys see I've researched that.

Casey: 43:31

You did. Thank you.

Josh: 43:32

You're welcome. You're welcome. I love it. I absolutely loved this conversation. Do business adviser groups like yours have business advisors where you guys are having external people look at your business, giving insights and growth and helping you guys navigate and helping you grow as a leader.

Casey: 43:55

Yeah. I, I do have a board that I put together and I went out and found a couple of advisors to come in and fill in some of the weak spots like marketing, right. And some financial deal structuring. I'd never acquired a company and never had figured out how the exit strategy was going to work because I was a part of a franchise organization. I was kind of within a business and that's been certainly helpful. I've had that, I've had the same board now for four years and it's been, and it's nice to have people who know the answer.

Josh: 44:26

Yeah. They've been there. Right. Yeah. All right. At what point in your business growth, did you say it's time for me to get a board?

Casey: 44:42

Well, transparently, I wish I could just hire, an advisor that does what we do, but I actually haven't found a lot of people that do what we do at scale. I found a lot of one-off. For me, what I didn't, I wouldn't hire specialists is what I decided. I think what really, once you are, I mean, this is small, but once you're over a half, a million dollars in revenue each year, I think it's insane that you would not have a coach and advisor somebody that you're feeding off of and sound boarding and getting advice from. You'll probably have to upgrade those people over time, unless you come hire an advisor, cause we'll naturally upgrade you. Say, I told you, I can't turn the sales hat off there, Josh, but it is, for me, I think it's immediate. So, I mean, look, I, I, the moment I figured out I was going to scale this company, which was in 2016, I had built up a big book of clients. My co-founder and I, we could have wrote off in the sunset for the next 30 years. Like most business advisors do and just kept, advising the companies. We want to be a part of. We said, no, we can make a bigger impact than this. We're going to scale it. The moment that happened is when we went and did it, and I would just say, if you're over half million dollars of revenue, that's crazy. You don't have an advisor, a coach or somebody that you're, you're confining in because you can't see around yourself.

Josh: 46:08

Oh man. Entrepreneurs have so many blind spots going into building this thing. We go in this because we either, we like it. Or we see an opera opportunistic, thing. We dive in, but man, we run through brick walls and we'll be bleeding and, tripping and all this stuff before we go,

Casey: 46:27

Okay, the heck out of all of it, most of all we see, you're just like, how many steps are you doing to get this done? That's more commonly what we deal with actually.

Josh: 46:37

Yeah. Super cool. So let's put deals in business aside. Let's talk about personal goals. Like where do you, how do you're winning? What's your, what's your currency? One of my buddies taught me this. He has people like, what's your currency? Like, how do you're successful or doing it.

Casey: 46:56

For me? It's, it's a calculation of hours worked compared to growth rate. Okay. For me, what gets me up every morning is I love the growth rate. I love trying to figure out how to keep up with the growth rate is every, does anybody who's scaled a large organization? Keeping up a growth rate is really hard. It's a massive challenge. That's what wakes me up every day. And I loved solving that problem. That's my currency personally, for success. If I saw that growth rate, I celebrate the win and then the hours worked. It's, you know, I have not worked. I probably work five nights a year. Max. I might work two hours one weekend in the last three years. I'm not, you're not gonna find me a normal business hours because then I'm with my kids. That's why I don't care if you it's not an hour is not necessarily when you work, but I'm in control of the time that I work. The moment I lose that I'm losing.

Josh: 47:59

Yeah. We're all working our ass off essentially to get to the point of some type of freedom, right? Freedom of, where we can spend time, right?

Casey: 48:10

Or impact, I would say freedom or impact. I see both, some people are driven towards impact. Some people are driven towards freedom. Some people are driven towards both. What I mean is some people don't need that freedom. They don't need that level. They're there. They were born with such a level of servitude that's actually what brings pure joy and happiness. You probably can think of those people in your life, Josh, where you just like, Hey, this never stopped, but they seem so thrilled. I mean, I can think of several. I am. I wish that I was all impact. I love the impact. I love seeing the turn, but I'm definitely on the freedom side.

Josh: 48:46

Yeah. Super cool. If I grabbed your phone, are you an apple or Android kind of guy?

Casey: 48:51

I am an apple kind of guy.

Josh: 48:53

Okay, cool. If we look through your music playlist, the top song that you've played most consistently over the past 10 years, what song is your favorite song?

Casey: 49:04

I was the same as the last two. It'd be like something from the wiggles for my son,

Josh: 49:10

The propeller.

Casey: 49:13

Oh gosh. That song is made about our propeller methodology. That's exactly. That was literally like on spot. Like we did not plan that. That was amazing. I would say I had to pick, that's a hard question. I'm pretty dynamic on I'm like I'm all over the map on songs. For 10 years, I would say a song that is there. So I actually grew up in music. I grew up in the arts, actually got a full ride to school for music and converted that to an entrepreneurship degree. I might be into some different stuff, but the artists that I've held on to for 10 years is James Morrison.

Josh: 49:53

Really?

Casey: 49:54

James Morrison.

Josh: 49:56

Far,

Casey: 49:56

The vocalist is very similar to how I sing. So I sing the songs constantly. I dabble on the piano. I know to play all of his songs on the piano. For that reason, that's why it's been like across 10. I don't know if it's the number one, but it's the only artist that came to mind that I have been into for a decade.

Josh: 50:14

Which one song has been most impactful to you by Morrison?

Casey: 50:21

Only.

Josh: 50:22

For the hard ones, right?

Casey: 50:24

It is. It is because, well, just transparently. I have a lot to choose for. I'm pulling up is like last three albums here, just to like, see if there's someone that really picks out. I was going to say, you give me something, but that's the most popular. So I'll say broken strings,

Josh: 50:41

Broken strings. Cool. If you could hang out me, you Morrison and were going to do some event. Right? What would be you and James do?

Casey: 51:00

What do you mean? Like what do we do at the event?

Josh: 51:01

Yeah. Yeah. We w we, we just watched him play live and he's like, Hey boys, I want to go hang out with you guys. We go out and we go either get a bite to eat or coffee or drink or skydiving. Like what do you think would be a cool time to hang out with James? Like, what would you want to do?

Casey: 51:19

Two parts, one, pull a re poured, amazing craft cocktail. So the room and sit back. Honestly, let me get the whiteboard out and show how James could double or triple his revenue. I'm just being honest. I would love that.

Josh: 51:35

All right, James, let me show you this. This is the propeller.

Casey: 51:38

I'm addicted to it. People are always like, what do you love to do in your free time? Like, honestly, tell me about a business. Give me a Google spreadsheet, let me get lost for three hours. Like I genuinely get a lot of joy out of that. That's, I probably truly wouldn't do that with him. I'd probably, I probably would honestly be like, all right, start playing the song. I'm going to sing with you and see if I can sound like you because it'd be all ego, but deep down, if it was most fun, that's what I wish I would've done.

Josh: 52:02

Whiteboard. Do you have a lot of whiteboards in your office?

Casey: 52:05

We do. We have an eight foot like whiteboard glass whiteboard in every single office that are at a I'm at my home office right now. At our, our office, our core office here downtown.

Josh: 52:14

So needed, so needed. You could tell me. Yeah, that's just a duplication of your Excel spreadsheet, but man, I love a good whiteboard.

Casey: 52:20

Oh, he made it the new zoom feature on whiteboards. Pretty, pretty stellar.

Josh: 52:24

Nice. Maybe I'll play with it one day. All right. So back to deal. Sorry about that. I side railed us. You made James, we just finished our nice craft cocktail. He just played broken Springs for you. He signed an album, you got a tattoo with him. He goes, the perfect deal walks in the room, right? And he's like, Hey, I got it. I want you to meet my boys over here. They got a company and it's the perfect deal for your company. What does that look like?

Casey: 52:55

It's a, probably a business, 1 million to 20 million size. The it's the business owner that is either on the treadmill or they're fast-growing and try not to let the wheels fall off. They're excited to figure out how to either get to that exit, how to get to that vision that they're shooting for. They want somebody to help come in and advise and fill in the gaps to help them put them in the right structure to create the growth. As far as, industry we're industry agnostic. It can be any industry, but we do prefer businesses to have more human capital. So, tech companies, software company still are human capital. You're still going to count, higher account executives, but people are what makes businesses so complicated. It's usually people that.

Josh: 53:37

No way,

Casey: 53:39

No way. So that's one. The other perfect deal though, would be, a private equity firm or, like one of these sponsored folks that are putting together a deal that would come in and say, Hey, let's bring cultivate and do a deep dive analysis. Or they've just recently bought a company and they're saying, Hey, we want you to come and help us build a roadmap and figuring out what are we going to need to do to really scale even it's just to validate their initial thoughts. The third party perspective offers immense value,

Josh: 54:06

Do a grips ever bring, so this score, all right. One to 20 million industry agnostic, they got to have some level of human capital. It's not a solopreneur. Who's just cranking out Bitcoin mining or something like that. Right. But it's,

Casey: 54:16

It's not, that's not a way for us because it's hard to scale that business. Right? You've got to have a business that you want. If you don't want to grow your business, AKA shrinking amount of time you're working, or, you have some growth objective, otherwise you would never hire us. It doesn't make any sense.

Josh: 54:28

Yeah. They've gotta be growth focused growth minded. Two is PE group aggregator or something like that. We just bought a business, need you to help us. Or we're looking to buy business, take a look at this guy. Do you ever get brought in by these aggregators or PE groups or holding companies to go, Hey, here's our business? What kind of company do we need to add to our ecosystem? Or what kind of opportunities should we look? What kind of deals should we look at to go acquire?

Casey: 54:53

I'm thinking. I tend to be really Frank with you. Not really like, that's not our space. We're, we're so much more in the weeds of like, when the businesses there, what do you do with it? I will tell you, I've had some really interesting conversations with a few P firms though, that especially more of the sponsored smaller groups where, they, because they learn after we go in and work with a business or two, they see our methodology and our, and how we break it down. I will tell you, I think they start to go. We should only hire companies that have our buy companies that have these four elements. They're like, yeah, it's might be more important even than your industry that you're focusing on. If you really want to hit as many times as possible. That's what I could share, but no, I don't think they would normally bring us in to do that because I don't think we have that expertise or that market diversification knowledge,

Josh: 55:42

Who in the organization brings you in? Like, Hey, I, my buddy over here told me about you guys and we're bringing in, is it founders at COO? Is it CFO? Like, who's typically pulling it. You guys,

Casey: 55:55

Yeah. For the business itself, it's usually the owner, we've had a few, CEO's or, or staff are like, Hey, I've heard about this company. I think you should go do this assessment just to see what we learned about our company, but that's probably three, four or 5% of our intake. Most, most of our intake is directly with the business owners. It's such an intimate thing. Right. We're helping the owner figure out how to grow and scale the company. Not that we won't, we're help with their people and get involved with their people, the owners, and the classic phrase. Right. And bring the horse to water. Doesn't mean you're gonna get him to take a drink.

Josh: 56:24

So.

Casey: 56:26

Yeah. You need to be ready to take the drink on the PE side though, or some of these, sponsors folks like they're putting, structuring, putting other deals. That's really been kind of all over the board. I mean, it's been partners, it's been, vice-presidents that are, overseeing, the four or five companies. They've just got one that they really want help on. Most of the sponsor folks now are still only like two or three people deep. It's usually, co-founder and owner, that's putting together the fund and making the purchases.

Josh: 56:57

Super cool. All right. With that, let's do a shout out to the website for companies out there for PE groups out there that, could use your services, want to connect with you and do deal work. Could they find with you, where could they find you and do a deal with you?

Casey: 57:13

Yeah. Cultivating advisers.com. If you're a company, when you go on there, find the free assessment section, fill in your, if you qualify, we'll sit down and give you a bunch of free hours with an advisor, we think would be the right fit. So you can test trial it. Worst case, you walk out with a ton of different ideas for the business. No obligation. High-risk.

Josh: 57:31

Cool. You, you said this and I got, say, what would be some things that would disqualify a company from working with you guys?

Casey: 57:39

Yeah. We have, I don't always give it away cause I don't want to know my tests, I would, I would say at a high level, minimum revenue size, like, if you're, if you think you've got some, that's going to grow pretty quick, we'll have a conversation. Again, if you're about half a million, mark is really where we play. It's where we're more applicable. Revenue is not always the best indicator make you got a couple employees like you're, you're in the growth mode. Another, another example is when we talk with you, we just don't buy into the product or service. We don't think it's a good product or service. You call us and you've got a thousand Google reviews and two of them are five stars and the rest are two and one stars. We're probably not gonna help you, no point helping scale something, that's not going to last. Right. We'll just kind of look at that and go, you need to go fix some other industry specific things. You need to go hire an industry expert. Not us. You're not ready for us right now. We're definitely dialing in the introspection, back to the ego conversation we're slowing down and just kind of go, where's this ego at, are you ready for this? Are you ready for the hard work that goes into this? Or are we, are you just coming at it more for, somebody told you to and you think you've got it all figured out,

Josh: 58:49

Love it, love it. Love it. One more time. Where can people go to find you to connect with you, do a deal.

Casey: 58:55

Cultivate advisers.com,

Josh: 58:57

Cool fellow deal-makers as always reach out to our guests. They thanks for being on the show. All their contact information will be in the show notes below. If what they're saying resonates with you, reach out with them, find a way to connect with them, do a deal, follow their work and cheer them on as they help other businesses grow and scale. If you in the audience are working on a deal, looking at a deal and want to talk about it here on the show, head on over to the deal. Scout.com. Fill out a quick form. Maybe get you on the show next till then talk to you all on the next episode. See you guys.