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How One Founder Moved Her Multiple From 2 to 8 Times EBITDA

July 2, 2021 |  

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Dr. Kristin Kahle helps businesses pick a benefits program for their employees.

She started three insurance agencies and the first two were service businesses that sold for a modest 1.5-2 times EBITDA.

With her third business, Kahle wanted to attract a higher multiple, so she decided to transform it into a technology company. Kahle built NavigateHCR up to more than 40 employees before she decided to sell. She got three offers and ended up agreeing to be acquired for around 8 x EBITDA plus a five-year contract that guarantees her employment.

Here’s what you’ll learn from Kahle’s story:

  • Why five years may be the ideal time to own a business.
  • The $300,000 mistake Kahle made in trying to transition a service company into a technology business.
  • How to massage your books to jack up your EBITDA and maximize the value you take from your sale.
  • Why having something propriety nobody else offers matters to both your customers and potential acquirers.
  • The value of long-term contracts.
  • How to start an acquisition conversation with an acquirer through the person responsible for partnerships.
  • A unique way to carve out time to work on your M&A deal.
  • Why potential acquirers asking you for less information should be a red flag.

Show Notes & Links

(04:17) Dr. Kristin Kahle: “It was born during the time of healthcare reform, which was a big sweeping policy that President Obama passed. Gosh, now we’re almost 11 years ago.”

(06:04) Dr. Kristin Kahle: “So Elliot Spitzer came along, gosh, now I think this was 25 years ago before his little oopsie and he really sort of regulated a lot of the commissions around the insurance industry.”

(15:31) Dr. Kristin Kahle: “I asked one really fun question that tells me everything about a candidate, which is a fun question. I ask them to ‘describe your closet to me’.  I know it’s a funny question to ask. So think about it. It tells you a little bit about their organizational skills. It tells you about how they’re thinking about their closet. It tells you what kind of concept they’ve done. Have they had a start-up process? Do they have a process?”

(28:07) John Warrillow: “For folks listening, EOs stands for Entrepreneurs Organization and YPO stands for Young Presidents Organization. Two great organizations.”

(36:17) John Warrillow: “We did an episode years ago with a guy named Ari Ackerman… and folks who want to listen to that, we get into much deeper details on adjusted EBITDA.”

(53:57) John Warrillow: “It’s interesting. I did an interview with a guy named Bobby Martin years ago, built a great company, First Research. He wrote a book called The Hockey Stick Principles. Great guy. Anyways, when I talked to him about his biggest regret, it was not thinking through the conversations he was going to have with each of his employees.”

(1:00:43) Dr. Kristin Kahle: NOtivation with a capital N-O instead of motivation. It’s how to use the power of no to make your first million dollars.”

About Our Guest

Dr. Kristin Kahle assists companies in streamlining their benefit administration, communications strategies and developing their Health Care Reform Strategy. She assists small and midsize companies with solutions.

Dr. Kahle is passionate about education, currently holding a Certified Health Care Reform Specialist (CHRS) designation. She also holds an MBA and Doctor of Business Administration (DBA).

Her passion is to help companies understand Health Care Reform and all the components that make up the law. She is the founder of NavigateHCR, based in San Diego, CA. NavigateHCR is focused on Healthcare Reform (HCR) compliance and reporting solutions for your business. They believe navigating Healthcare Reform should be simple for employers. Utilizing their Compliance Communications (EmployER and EmployEE Direct®) and Monthly Monitoring services (HCR Tracker®), saves businesses valuable time and resources, otherwise spent attempting to keep up with HCR compliance. Navigate HCR recently joined forces to bring brokers and employers leading-edge technology, creating a new company NavigentSolutions, which is providing a stand-alone platform for the IRS reporting and filing under the ACA.

 

Connect with Dr. Kristin Kahle:

Watch the interview

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Transcript

Disclaimer: Transcripts may contain a few typos. With most episodes lasting 60+ minutes, it can be difficult to catch some minor errors.

John Warrillow:

Hey, it’s John Warrillow. I wanted to record this quick message to let you know that I’ve got a new book that’s now available called The Art of Selling Your Business. And really it’s a distillation of some of the best practices I’ve heard from some of the smartest entrepreneurs I’ve interviewed for this show. Having done now more than 300 plus interviews for Built to Sell Radio, I’ve seen that there’s this small group of founders who seem to really have incredible exits. Ones where they make life-changing money from the sale of their company. And what I’ve tried to do is really analyze what are the transferrable lessons among that small cadre of winning exits. I put those into an action plan, a bit of a just-add-water recipe card for punching above your weight when it comes to selling your business. The book is called The Art of Selling Your Business. It’s available anywhere you buy books.

Coming up you’re going to hear from Dr. Kristin Kahle, who started three companies in the same industry. The first two traded at relatively low multiples, one and a half to two times EBITDA. The third one traded at eight times EBITDA. What was the difference? I’m going to let Kristen tell you her story. Here she is. Dr. Kristin Kahle, welcome to Built to Sell Radio.

Dr. Kristin Kahle:

Thank you so much for having me.

John Warrillow:

Yeah. So you were in the benefits consulting business, which I have to admit as a Canadian that’s foreign to me. I don’t even get that at all. So I need you to explain what a benefits consultancy does. That sounds totally foreign to me.

Dr. Kristin Kahle:

Does it not sound sexy? I mean, come on.

John Warrillow:

Not so much.

Dr. Kristin Kahle:

So in our beautiful country of the United States, we have employee benefits that are really offered by their employer and hence therefore called employee benefits. So what we do is we go out and help companies really sort of look at their employee benefit plans that they’re offering. And it could be things like medical, or dental, or vision, or life insurance, or the entire package for employees.

And we come out and we do all kinds of fun stuff and look at what they’re offering, what their population is, what their demographics of needs are and we really sort of take a look at now, all the new legislation that’s been passed and how to mirror those two things together in order to help companies with their employee benefit package in order to recruit and retain employees.

John Warrillow:

So if I own a company and I want to attract employees and keep employees, I got to give them benefits. And there’s a whole sea of different options out there. And I hire you to come in and help sift through all the options and come up with a kind of something that’s cost effective for me as an owner, but also gives good benefits to my employees.

It makes it attractive to come work here. Actually, truth be told, I think they do have companies like that in Canada, but I think just the nature of healthcare is a little bit different. So how did you get paid? Do you get paid by the insurance company or do you get paid by the business?

Dr. Kristin Kahle:

Yeah. You get paid a little bit of both. So the insurance companies have commissions that are built into those premiums. And so a broker goes out to those insurance companies and basically looks at multiple companies and looks at multiple policies and comes in back to the employer and say, here’s X, Y, Z company that I’d recommend.

And then to some extent, the company would also pay you for either doing some consulting work, which is really sort of how NavigateHCR was born, if you will. It was born during the time of healthcare reform, which was a big sweeping policy that President Obama passed. Gosh, now we’re almost 11 years ago. And what that basically said was that if you were an employer, you must offer benefits.

Because there were a lot of employers out there that wasn’t offering benefits. But then what it did is it also came into looking at different governmental entities that now are involved with reporting and documentation and some of those other really fun things that people don’t want to get and do or have anybody do at all, we came in and actually did that for them.

John Warrillow:

Thank God we’ve companies like yours out there because that sounds horrible. So you’re doing the plumbing work and trying to sift through this. Here’s my question. If you’re getting paid by both sides, did you have to disclose the fees you were making from the insurance provider, the waiver, commissioner, rebate, whatever they call it to your client? Question. Well, I’ll start there. Did you have to disclose that?

Dr. Kristin Kahle:

Absolutely. So you would disclose the commission agreement with the insurance carriers, but then you would also have them sign a contract to some extent to do services on top of that or services in addition to what they’re being paid for, what you’re being paid for.

John Warrillow:

And I know in financial services this is a huge deal because, among brokers and so forth, they get better spiffs from certain companies. And so even though it’s not right for the client, this is the whole concept of fiduciary and blah, blah. It goes on and on. How did the client know that they were really getting the best solution as opposed to the one that gave you the best commission? Does that make sense?

Dr. Kristin Kahle:

Yeah. Great question. So Elliot Spitzer came along, gosh, now I think this was 25 years ago before his little oopsie and he really sort of regulated.

John Warrillow:

That’s how you call it these days, an oopsie.

Dr. Kristin Kahle:

An oopsie. Oopsie, I didn’t mean to do that. And he regulated a lot of the commissions around the insurance industry. So what happened was you have to have the fiduciary responsibility of showing multiple options to employers and allowing the employers to make their choice in their selection. So there’s some ways to certainly document those things.

For example, doing a survey of employees to find out who their doctor or dentist is, and then eliminate policies based on who doesn’t accept that insurance company. That’s a great way to say, we did our fiduciary responsibility, we did a survey we found out and we only offered these plans because X, Y, Z employees get access to that.

So that’s just one example of all of the things that we have to validate in order to help employers with an entire suite of employee benefit packages and on top of those, all these HR rules that come with it.

John Warrillow:

Okay. There are a ton of employee benefits consultancies. How how did you guys differentiate yourself? What was [crosstalk 00:07:21].

Dr. Kristin Kahle:

So I like to say that I came out of the womb doing employee benefits, which is kind of funny when you think about it. But I actually wrote a fourth-grade paper that said, I want to be in insurance, which I don’t think anybody wants to be in insurance.

John Warrillow:

That’s really weird.

Dr. Kristin Kahle:

Yeah. Except Flo from progressive. She loves insurance and she wears her apron everywhere and she’s great and a great insurance ambassador

John Warrillow:

Did you really in Grade 4 write an insurance? Your parents must’ve been involved in insurance.

Dr. Kristin Kahle:

So proud. They’re so proud, right? It actually is framed in my office. True story. So I did because my father… There’s two ways you get into insurance, right? The first way is nepotism. That was my dad. My dad is in insurance. And the second way was you sort of fall into it. So I was nepotism. I was working around that office and doing all kinds of stuff and I wanted to help people.

So when I looked at what my dad did, I really admired sort of what he did and what area he was in the benefits space. So I got my license right when I turned 18. So most people are out getting their driver’s license. I got my insurance license right when I turned 18 and I worked my way through multiple insurance companies that did great training programs and really sort of honed my niche.

And my niche was really helping companies that were size 50 to 3000 and really sort of taking a look at their benefits policy, but then layering on top of it a complexity of all of the compliance regulations that go along with those employee benefits plans. So that was really how I started my niche and ultimately started my third company which was NavigateHCR.

John Warrillow:

Got it. That’s still sounds pretty broad, companies with 50 to 3000. Was there another overly on top of that, of some other targeting or segmentation?

Dr. Kristin Kahle:

No, not really. It is quite broad when we look at it. But we also sort of looked at how many HR staff that they had, because what we find is 50 to 3000 in the United States, we find one or two or three HR team members that can’t necessarily wear all the hats that they’re expected to wear inside of HR.

And if you think about what HR does, it’s multiple hats a day. Payroll, it’s all kinds of stuff. Employee benefits is just the tip of the iceberg. So we were looking for companies that had very small HR departments that needed to outsource not only benefits, but all of the compliance complexities that go with that.

John Warrillow:

Got it. And so you got this niche, which is great, but how did you win business against some of the other consultants out there? What was your point of differentiation? Why did I choose you over the other half dozen guys or girls in my office?

Dr. Kristin Kahle:

Yeah. That’s a great question. So the industry is definitely male dominated. So that’s number one. I think it’s less than and 1% of females are in the sales side of the insurance industry. So if you look at who you’re selling to, 98% of HR is females and there’s less than 1% in the industry.

So certainly that helped. So the old playing golf and getting benefits on the golf course has sort of changed with the dynamic shift of females entering the workplace and really making these decisions that has certainly changed. Second thing that-

John Warrillow:

So 98% percent of HR professionals are women.

Dr. Kristin Kahle:

Are women.

John Warrillow:

And did you use the sisterhood vibe to get deals? Did you say, “Come on girl, help me out here.” Was that part of the shtick?

Dr. Kristin Kahle:

Well, instead of golfing, we may have done martinis and manicures. I’m just saying. So instead of going out for nine hours, we’re going to go out to the spa for nine hours and do something better than golf. I’m just saying, So could there have been some of that that was used? Absolutely. And it was nice for them to actually get pampered and spoiled and not get invited to the golf course.

John Warrillow:

Love it. Could you give me, all kidding aside, a real example of something you would have offered in the way of a spiff or a client gift or some sort of fun thing? Was it manicures and pedicures or what specifically did you do?

Dr. Kristin Kahle:

Yeah. So I used to get together all of my HR teams quite regularly on a quarterly basis where we would do something fun like that, but with an educational turn. Because, again, when you think about HR, they’re getting bombarded with everything. You want to take them away from their location, give them some education and give them some fun because nobody really sort of spoils HR.

So they’re always the ones that get the last end of the stick out a variety of things. They’re always the ones to do terminations. And so they’re always the last one people see on the way out the door, and that’s not a fun job to be at all when you have to do terminations for multiple businesses or multiple entities. So we would take them away from their location, give them CE credits.

So one of the things that I’m a huge proponent of is education. So I went out, I got my doctorate degree and then I’m an educator for HR. So I give them a CE credit so that gets them there. But then I do something fun as well. So really sort of adding a fun element. So yes, it was martinis and manicures.

And sometimes it was martinis and massages. And sometimes it was a comedy show. And sometimes it was just a variety of things that we could get them excited about learning something in the HR space, but also outside of their element.

John Warrillow:

Love it. So that’s a bit of a unique positioning. You’re obviously a woman targeting mostly women as customers. How did that influence the people you hired on your team?

Dr. Kristin Kahle:

It’s a great question. 98% of my team matches our population of who we serve. So if we’re serving 98% of women, 98% of my team is also women. If we narrow it down to the age category of my customer, I believe that I always want to hire what my customer looks like. So if that is a 45 year old woman, I’m going to be hiring 45 year old women that look and sound and act just like my customer does.

So if I look at my base of 50 to 3000 employees, the average age of that HR person is between 42 and 48 years old. So the majority of my employees fit that demographic because that’s our customer as well as those are who I end up hiring.

John Warrillow:

You have to be careful there in terms-

Dr. Kristin Kahle:

You do.

John Warrillow:

… of discrimination. You can-

Dr. Kristin Kahle:

I’m in HR.

John Warrillow:

This is perfect. I can get some advice here. So if you’re going to be your clients and your clients or whatever, they all have green hair and they are all men between the ages of 100 and 105, that would be discriminatory if you went and hired people that had that same color, wouldn’t it? How did you get around that?

Dr. Kristin Kahle:

So when I look to hire employees, so if we’re sort of taking me back and put my CEO hat on for a second, there’s a few things that I want to hire. Number one, I’m always hiring people with an HR background. So, again, I’m hiring people that have that HR certificate or have that HR background three to five years, five to 10 years, depending upon what the positions may be. Number two, I want to hire somebody or people that correlate.

So what does that mean for me? We give tests. So I’m a big proponent of testing your candidates before they come in. So it can be disc, it can be strength finders, it can be a communication flow. So I know as a CEO I’m wearing my CEO hat that my number one strength is I’m an executioner, right? That means I just get stuff done.

So I know that I need to hire other executioners that at least have one of those traits in their top five scenarios. So when you start eliminating things and putting it through the funnel of the candidates that you’re looking for, then you get your population to interview. Then it becomes the interview. And I asked one really fun question that tells me everything about a candidate, which is a fun question.

I ask them to describe your closet to me. So think about it. I know it’s a funny question to ask. So think about it. It tells you a little bit about their organizational skills. It tells you about how they’re thinking about their closet. It tells you what kind of concept they’ve done. Have they had a startup process?

Do they have a process? It sort of really sort of does it in a fun put your guard down kind of way. And I laugh and I chuckle when I ask the question so I get to see some of their personality as well. So that’s one of my really fun questions that I ask in an interview.

John Warrillow:

I love it. Cool. So as you’re growing this business, I mean, you mentioned before you’d sold other companies. Are you building this to sell? Is it your vision that you will sell Navigate at some point?

Dr. Kristin Kahle:

Yeah. So I already sold it. So I sold it in 2018.

John Warrillow:

No, I know you sold it, but my question was as you’re growing up, was it your intention?

Dr. Kristin Kahle:

My first two companies, I always knew that I wanted to build and sell within five years. So Navigate I took the same trajectory. And so Navigate really started out as a service-based business and most brilliant ideas come to you in the shower or in sleeping or whatever. So I was washing my hair in the shower year in to NavigateHCR and I had a brilliant idea to take it from a service-based business to a technology-based business.

So I know nothing about technology. I know nothing about writing code. I know nothing about managing teams of developers. I know nothing about it, but all brilliant ideas. I’m a typical CEO as I’m going to jump out of the airplane and hope that parachute opens, right? So I decided to change from service to technology-

John Warrillow:

What was driving that?

Dr. Kristin Kahle:

… and learned all kinds of lessons. I’m sorry.

John Warrillow:

What was driving your desire to have a technology business?

Dr. Kristin Kahle:

The sale and the multiplier of sale. So the other two companies were service-based businesses where I ended up receiving about one and a half to two times EBITDA. I knew as a technology company that, yes, I’d have to put blood, sweat, and tears into it, but I also knew I’d get a higher EBITDA. But I also knew that the technology that we were building nobody else out there had. So I sort of put those two things together and said let’s become a technology company.

John Warrillow:

Got it. So your experience was the service company trading kind of one and a half two times profit pretty modest sort of exit as it were.

Dr. Kristin Kahle:

Mm-hmm (affirmative). Absolutely.

John Warrillow:

Or technology company you thought you could do better. What sort of multiples were you hearing at the time? This is well before selling that you thought a technology company could do better than two times profits. So what did you think it could do?

Dr. Kristin Kahle:

Well, you hear all the Silicon Valley stories and I think to some extent, those are not necessarily legitimate stories for a variety of reasons. I think a lot of it’s fake money to some extent. Cryptocurrency, if you will. So I was hearing anywhere from five to 11 times.

John Warrillow:

EBITDA or revenue.

Dr. Kristin Kahle:

EBITDA. And so what I chose to do was I chose to hire a firm to help me sort of do an analysis of what could my range become. And so instead of this giant nebulous range that you could even go up to 100% of EBITDA or whatever it was, I wanted to narrow it down to really understand what it was going to look like for sale.

John Warrillow:

And what did they tell you?

Dr. Kristin Kahle:

Five to eight.

John Warrillow:

And so every service company owner I think listening to this has at some point sat down and dreamt about the idea of becoming a technology company for a lot of the same reasons that you are describing the better multiples, obviously more scalable, more process, less people, blah, blah, blah. What was the most surprising thing for you trying to make the transition from a service-based company to a technology company?

Dr. Kristin Kahle:

Which roadmap to go for technologies. So what do I mean by that? Do you hire it? Do you bring it internal? How do you run your technology teams? Because they’re run completely different than your service-based team. How do you run your technology teams and which way to go with that? So I’ve tried it all.

So how to really sort of narrow it down how to start that out and really sort of what platform to put your technology on that’s going to be able to grow with you when your software grows, because the next year some of your software that you’ve put in place is out of date already. So I think really sort of understanding the foundation.

John Warrillow:

So what did you do in the beginning to develop your technology team and platform? What was your decision?

Dr. Kristin Kahle:

Well, my first decision was to hire it out, which is definitely what a lot of people choose to do.

John Warrillow:

Outsource it.

Dr. Kristin Kahle:

Yeah. Outsource it. So bringing a company, let them sort of set up the platform. The advice from that first company was to really write on a code and a platform that most developers don’t write on. So it really then became an expense versus sort of where we had to transition from.

So I spent a good eight months out of my time throwing a lot of money at it as well to really sort of decide, that’s not the way to do it. And so I think really sort of understanding where you can get developers, where you need to set your foundation and really sort of what code you need to write in in order to grow your software.

John Warrillow:

What was the code that they wanted you to write the first iteration of the software?

Dr. Kristin Kahle:

It’s a code called Drupal. And what I have found is that Drupal developers are three times the cost of a . NET developer. And I might be speaking Greek-

John Warrillow:

Surprise, surprise.

Dr. Kristin Kahle:

… to some of your audience, but I’ve learned these things now. And so there’s a lot of . NET developers out there in all parts of the world that are affordable. And so I think when you’re looking at that type of scenario, it’s just knowing which way to lay your foundation.

John Warrillow:

So did you make the switch to . NET?

Dr. Kristin Kahle:

I did.

John Warrillow:

How much did you sink into the Drupal?

Dr. Kristin Kahle:

Painful switch.

John Warrillow:

How much did you sink into the Drupal?

Dr. Kristin Kahle:

Gosh, probably about a good $300,000.

John Warrillow:

And was that sunk money?

Dr. Kristin Kahle:

Yeah. To some extent it was.

John Warrillow:

So you switched to Drupal. Tell me, you described the business model is somewhat service-oriented. So going out doing research, understanding what the different options are, surveys, et cetera. So that sounds very qualitative service-based. What was the technology play? What were you trying to create through technology?

Dr. Kristin Kahle:

So when you look at sort of how HR is done in the United States, it’s a lot of paperwork, right? There’s a lot of elements that happen in employee life cycle. So meaning when an employee enters your company to an employee leaves your company, there’s a lot of variation that happens. Employee benefits is just one component of what happens. So it’s, here’s what we’re offering.

You get to choose it every year in a way you go. So you’ve got some things that occur there. But what happens during the life cycle is, people get married, people have babies, people go out because they’re sick, they get promoted, they have to do certificate. So if you sort of start thinking about that, there’s technology that people have to pull different sets of those employee lifecycle in and they have to go various ways to do it.

And HR, to some extent, is not necessarily a revenue generator. They’re always at the bottom of the list when it comes to any kind of technology or any type of upgrades with regards to how to run their departments. And they’re running the entire company with regards to human capital. So we looked at all of those things that had to do and then add the element of healthcare reform.

And that element of healthcare reform now added one more layer called the IRS. The IRS most people in the United States start shuttering from. They don’t want to talk about the IRS. They don’t want to talk to an IRS agent. And we add one more element on top of employers that this is ultimately the area that’s going to look at all your data and decide if we’re going to audit you or not.

So we wanted to be able to build technology that created that entire life flow of an employee, but also talk to our governmental entities. So we could do everything in our system and then ship it to our governmental entities in order to make sure our clients were taken care of.

John Warrillow:

Got it. I want to go back to something you said earlier, which struck me as interesting. You started Navigate with a view that you wanted to get in and out in five years. What’s behind five years?

Dr. Kristin Kahle:

I don’t know. It’s a great question. I think to some extent as CEOs, especially me, I got a little bored. I think you get sort of to the point where you’ve got your systems and you’ve got your team and you’ve got things dialed in. And I think if you’re not, at least for me, if I’m not always designing or always doing something else, you get a little bored.

So I don’t know where the five years came from.I think because of the other two that I built at under five years. I sort of had this five-year and this figure in mind. I’m still obviously here. So I built it and sold it and I still have a contract. So I’m still sort of here at Navigate. So I don’t know what it’s really about. I think I probably need some hypnosis to figure out what that’s about.

John Warrillow:

Well, I think a lot of people would definitely acknowledge the boredom factor after the startup years for sure. And do you ever wonder if you may have sold too early? That perhaps five years is just too early in the life cycle, but you left money on the table and [inaudible 00:25:40]. So what are your thoughts on that?

Dr. Kristin Kahle:

Yeah. I don’t think I left any money on the table and I feel like my deal was a good deal. I think with any deal, I had to look at it at compromise on both parts. So one compromise that I did was I wanted 90% cash up front. So with 90% cash up front, what that came with was a five-year contract.

If I wanted less cash up front, it was going to be a shorter contract. So then I’ve stayed in the business for five years. So I’m two and a half years into a five-year contract. So I think because that was one of the things that I wanted, I think it became a good deal because of that 90% cash right up front.

John Warrillow:

[crosstalk 00:26:25] is like that’s a whole business for you. That’s an entire company.

Dr. Kristin Kahle:

Right.

John Warrillow:

That’s an opportunity cost there.

Dr. Kristin Kahle:

Right. And then I think also you want to have stock options. You still want to see your company grow. I don’t have children, but it sort of feels like to me as I raised them all the way to high school. Now I’m going to college.

So now my child is in college and you want to sort of make sure that you still cross that finish line, and you’re still delivering for your clients, and you’re still doing what you said you were going to do and making sure that your team is really sort of in a really good position.

So I think, for me, there’s some great attachment to the company that I built, blood, sweat, and tears. I sold clothes. I sold my car to start my business and bootstrapped it and all that other stuff to do it. So I think when you get to that point, it really sort of becomes how do I separate from the business at this point?

John Warrillow:

Got it. Let’s get into the deal itself. So how big did you get the company in terms of revenue or number of employees or some proxy for size before you decided, I want to sell it.

Dr. Kristin Kahle:

Well, let’s see. Since a lot of your audiences are EOs, we could be a YPO preferred company. So we got it to a pretty good point. Let’s just say it took us six months to hit the $1 million mark. And we grew every year 50% for five years.

John Warrillow:

Got it. So I’m totally lost as to what the YPO. What’s the YPO?

Dr. Kristin Kahle:

Your YPO marker is between $13 to $20 million.

John Warrillow:

Got it. I’ve never heard that before. Interesting.

Dr. Kristin Kahle:

So YPO just moved their marker down to $13 million.

John Warrillow:

Got it. And by the way for folks listening, EOs stands for Entrepreneurs Organization and YPO stands for Young Presidents Organization. Two great organizations involved in entrepreneurial sort of mentorship forum. I’m butchering it, but you can look them up. How many employees did you have?

Dr. Kristin Kahle:

So at our highest employees we had 47 employees all across the United States as well as we added some all across the globe. So certainly adding in developers or service or wherever would be. We do have service people as well and then technology and our technology platform. So 47 was our highest. Right now we’re sitting at about 28 employees. And then the company that bought us, we’re sitting in a large company of about 900 employees.

John Warrillow:

Okay. So you reach more than 40 employees. What triggered you to want to sell? Was there some sort of event that came up?

Dr. Kristin Kahle:

There really wasn’t an event that happened. Again, I had that five year vision and I started sort of going down the path of feeling like maybe there could be competition to where we’re at. Maybe if I got into a purchase agreement that brought different leads, then we could look at different ways to grow based on who I’d go into as far as a mother organization or a father organization.

So I just felt like based on sort of where we’re at, I went down the path of evaluating the business and getting the books cleaned and sort of looking at it at that point. And so it came along at the right time, at the right price, and I think I just positioned it in that area. Could I have punted it down the road another year or two? Yes. However, I just think that that was the right time for us.

John Warrillow:

As you evaluated the business again, 40 plus employees, what was your sense of a fair valuation at that point on a multiple of EBITDA?

Dr. Kristin Kahle:

So I was sitting in between the 6% and 8% range for EBITDA based on proprietary things that we had developed not only the software, but the process and really sort of the workflow of the technology tools that we used in order to make sure clients got through the process. And being able to know where clients were at in the process.

So I think when we went and I talked to some really smart people, way smarter than me, who really sort of then said, here’s how you evaluate it, or here’s some things that you can do to get bigger evaluations or better evaluations. So we implemented some of those things as well.

John Warrillow:

What suggestions did they have to get… So just to be clear, you said your EBITDA margin was sort of 6% to 8%.

Dr. Kristin Kahle:

6% to 8%.

John Warrillow:

I was asking a different question earlier. I meant, the first couple of businesses you mentioned were trading at one and a half to two times profit. You had an outside consultant saying, hey, if you make this a technology company, five to eight times profit is reasonable. Were you still working with the five to eight times number when you started to sit down and evaluate?

Dr. Kristin Kahle:

Yeah. Absolutely. And I think that’s the right number when it comes down to technology unless there’s some other circumstance. And, again, remember I bootstrapped it. So I didn’t have anybody I needed to pay off. I didn’t take any giant loans out. I had a line of credit. But as far as cost goes, my line of credit was minimal. It was $150,000. That’s minimal in a technology company for a variety of reasons.

John Warrillow:

And to be clear, it was definitely a technology company in the sense that you had built this app to manage this process. Your customers though, did not pay on a SaaS or software as a service model as I understand it. They were continuing to pay. You got a commission from the provider and a consulting fee from the customer. I’m I correct?

Dr. Kristin Kahle:

Yeah. So we have half and half, right? So we have clients that just come to us for all the technology pieces that do pay for SaaS. We also have our SaaS system that’s white labeled behind the scenes on a lot of companies platforms who I can’t mention their names, but we’re a white label behind. And then we had clients that were also doing the employee benefits for or working with brokers who were doing the employee benefits for.

So three different areas that the client could come in as a funnel, which when you said it was a broad funnel, yes, it was a broad funnel, but it basically then looked at that business side and really sort of brought people to what they needed and how we could protect their business. And that was sort of how we looked at that approach with clients.

John Warrillow:

Got it. You mentioned there were some people way smarter than you. I doubt that. But anyways, [inaudible 00:33:02] out of the view that looks at, “Hey, you could do this, that, or the other thing to make it more valuable.” What exactly did they tell you to do to make it more valuable?

Dr. Kristin Kahle:

Yeah. Number one was clean up my books. So really sort of look at how you could position your books for the question. If somebody came in and said, “Now, what is this? Or what is that?” That you had an explanation or you really knew your books in and out. And so I had great people that really sort of just cleaned them up, got them together, took some suggestions on how to do our revenues and our expenses a little bit differently and really sort of started embracing that as far as technology goes.

So that’s number one was clean up our books. Number two, come up with something proprietary, something that only you can do, only something you can deliver. So we came up with all kinds of proprietary process. We’ve got some trademarks out there. We did some software that nobody has integrated.

They could go out and buy six different software companies. We’ve got it on one platform. And so we really did some things that just made us unique to position it, that we can say, hey, here’s what we do, and here’s what a client wants to come to us for. And then number three, get long-term contracts, long-term transferable contracts.

So we wrote in our language that it can be transferred regardless of ownership and had long-term contracts three, five, seven, 10 years, whatever those contracts would be. And then we basically did those three things as somebody who wants to buy us looking obviously at positive when it comes to that purchase.

John Warrillow:

Fantastic. So when you went through the EBITDA adjustments process of cleaning up your books and kind of expressing your profitability-

Dr. Kristin Kahle:

The painful process.

John Warrillow:

… Yeah. Expressing your profitability in a favorable way for the purpose of the transaction. What did you do with the expenses you invested in developers? Did you spread that out over a sequence of years to lower your expenses in one year and maximize your profitability?

Dr. Kristin Kahle:

Yeah. So those people that were smarter than me, absolutely. The other thing that I learned about here in the United States is something called R&D credits, right? So really sort of looking at how to position my taxes as the business owner, but also how to position that inside of the software.

So R&D credits, if anybody is out there in the U.S. and developing software, definitely talk to your accountant about that because they can do a ratio about how to do it. But what really ended up happening for my pay is that I changed from taking dividends on a routine basis to going to a W2 employee because of the tax benefit of me being a W2 employee and being the ultimate stakeholder of the software product, which all of the software came from my brain.

So how involved I was with the software and how I basically said to the developers, I need you to do this, this and this, because I was so involved in it, it basically changed the way we did taxes. So those two things alone changed the way that our books looked when it came to a sale.

John Warrillow:

That’s fantastic. That’s fantastic. The adjustments process can be a place to make a lot of money, frankly, if you’re selling your company. So check that out for sure. We did an episode years ago with a guy named Ari Ackerman, I believe is his last name, and folks who want to listen to that, we get into much deeper details on adjusted EBITDA.

So that’s worth checking out as well. So you make these changes, you improve the business in the way you described, what was next? I mean, did you hire someone to help you sell your company? Did you do it on your own? What was the next step?

Dr. Kristin Kahle:

Yeah. I actually did it on my own. I had a legal team that helped me, but I knew to some extent who I wanted to sell to. So I looked at the dynamic out there of who was buying and who would buy me based on sort of a strategic play, because again, I mentioned that I wanted to grow and get some different sales, and we never had a salesforce here, right?

So a lot of it came from referrals, and a lot of it came from brokers, and HR, and speaking engagements, and building it organically like everybody really does to some extent. So I narrowed down the list of about 10 and then I started the engagement process with those 10. And then I narrowed it down to about three, and then I started dating three of them.

So I definitely started dating them, started sitting in on some of their meetings sort of looking at what the culture fit was going to be, looking at a variety of things for the business, not just the contract, because I think for me it was not just about the contract, right. It was about my employees. It was about the people that helped me build the business. It was about our clients. I mean, it was about so much more than just the contract. So I wanted to get comfortable with that. And then I narrowed it down to two.

John Warrillow:

I think a lot of people would wonder how do I search for the companies that are most likely to buy me? What did you do to identify the long list of 10? Was this just Google or what?

Dr. Kristin Kahle:

Well, I knew them, because to some extent they were already my referral partners. So if you think about it, the brokers who were doing employee benefits work need companies like us in order to sort of wrap that entire benefit process. So if I looked at those companies of who they work for, they were buying companies like me because it made sense. After the sale is done, NavigateHCR would come in and do X, Y, Z for our clients depending upon the size and what was needed.

So we wrapped it in a nice little bow for the client. And so I looked at those companies that were already sort of a referral source or companies that would need to have my services inside of their entire companies. And those were the 10 that I ultimately started the conversation with, plus who was buying, right? So there’s a lot of companies out there buying.

John Warrillow:

And what was your opening line to these companies? What did you say?

Dr. Kristin Kahle:

My opening line to most people is hi, I’m Kristin. Do you want to be my friend? So I think that’s pretty much it. I don’t know. My opening line to a lot of them was I really had a relationship with one or multiples of people. And I would have that person introduced me to their partnership person who ultimately introduced me to their M&A person to some extent. So really sort of going down the path of-

John Warrillow:

So you went in the back door through a partnership, the guys have a partnership.

Dr. Kristin Kahle:

Oh, yeah.

John Warrillow:

“Hey, we should partner up, blah, blah, blah.”

Dr. Kristin Kahle:

Absolutely.

John Warrillow:

And then how did you go from the partnership person to the M&A person? How did you do that?

Dr. Kristin Kahle:

Yeah. So just asking the conversation or just starting the conversation that just says, are you guys in the buying mode? Are you buying? What are you buying? Or I just saw your press release and you’re buying X, Y, Z company, and that’s very similar or different to me. Are you guys interested in a company like us in order to have that conversation?And so what would then happen is I’d go to an M&A person, and the M&A person of course would always be like, “Here’s your stack of things in order to start the M&A process.”

So one thing that I also did was I would only work in the M&A process on Fridays. So instead of working through it and getting sidetracked on sort of the M&A process, I’d work Monday through Thursday on all my other tasks, all my CEO tasks, all my development tasks, and then come Friday, I would actually turn off my email and I’d start looking at some of that M&A stuff. So I focused one full day on really sort of going through that process.

John Warrillow:

So the M&A people at these 10 companies came to you and said, “Hey, this is the kind of stuff we would need if we were going to enter into a serious conversation with you.” What’s your growth plan? What’s your profitability? What are your contracts like? Et cetera. Got it. That’s helpful. How did you go from 10 to three?

Dr. Kristin Kahle:

Yeah. So I limit process of elimination by certainly what they wanted to some extent.

John Warrillow:

In the way of information?

Dr. Kristin Kahle:

In the way of information to some extent.

John Warrillow:

The more, the less attractive?

Dr. Kristin Kahle:

No. The less, the less attractive. The less information they were asking from, the less attractive it was to me, because then it told me that they didn’t really have their process down, right? So if you pick up a process and say, “We’re going to buy a company. Here’s all the things that you need do.”

That was way more attractive to me than it filtering in. So just sort of the starting team and how they handle sort of the starting to, we need to gather some information, that was a big sort of red sign to me to say, stay away from these guys because they’ve sent me five emails in one day, and they don’t have their stuff together in order to put it in one email, right?

So just sort of even marrying down those types of things. And then really for me, it was talking to people where they’d already purchased or they already sold to the company. And I wanted to talk to people that loved it and people that hated it. So really sort of having access to those types of people told me if they gave me carte blanche access to anybody I wanted to talk to, that narrowed it down a little bit more because of course, they’re going to put in front of me the people that love the sale.

And I want to know both sides of it. I want to know the good and the bad. And so I’m always looking for the good and the bad when it comes to that. And so I narrowed it down to that. And then I also wanted to know public versus private because I just sort of wanted to go down that path. And if I wanted to be in a public company or in a private company, private equity owned or not private equity owned, and then stock was an important factor for me. So that’s how I sort of then got to the three that I got to.

John Warrillow:

Sorry. In what way was stock important?

Dr. Kristin Kahle:

Stock was important for my long-term play, because for me, I hadn’t really sort of had too much investments in the 401K space or my retirement space because I always reinvested back in the company. I swiped out all of my money to some extent to start this company. So for me, it was building back up my retirement plan to have that stock and to be able to have that on a long-term play when I knew I didn’t have enough or what I wanted in my pot because I started the business.

John Warrillow:

Okay. I’m lost because if you get paid cash up front, don’t you have a lot of money to go buy whatever stocks you want?

Dr. Kristin Kahle:

You do. But it was also a good question for me. And to be honest with you, it was one of the things that my husband wanted as well.

John Warrillow:

Stock in the acquiring company.

Dr. Kristin Kahle:

Yeah.

John Warrillow:

That’s interesting.

Dr. Kristin Kahle:

So for him, it is really about sort of security, right? He’s been an employee his whole life. He didn’t know how I was jumping out of airplanes without bungee jumps and parachutes. He didn’t get it. And he didn’t necessarily understand the whole sweeping of your account in order to start your business like all of us have done.

So he wanted more of a cushion. And for him, it was a very important thing that I had stock and that he had some access to sock because he also came along on the journey with me. So it’s also about the spouse that comes-

John Warrillow:

Did he work in the company then?

Dr. Kristin Kahle:

He did not, but he came in the journey.

John Warrillow:

By virtue of the fact that you’re married.

Dr. Kristin Kahle:

Yeah.

John Warrillow:

I got it.

Dr. Kristin Kahle:

So it was one of the things that I wanted to honor him for as well.

John Warrillow:

Got it. That’s super helpful. So at what point did you receive offers? You had three. Did all three make an offer? How did that work?

Dr. Kristin Kahle:

Yeah. So all three made an offer. And so I hired a attorney to help me weed through the offers really because I wanted a different eyes set on it. And then I went to my advisory board. So I had built an advisory board of people that I trusted in order to help me through the sale. And my dad was on that advisory board.

He had sold multiple businesses as well. I had a few other people that were on that advisory board. So I took all three offers to them because most of my decisions I’ve made myself, and I thought this was such a huge decision that I really wanted a sounding board. I wanted some coaches in order to help me through this decision.

John Warrillow:

What did your advisory board say about the three offers?

Dr. Kristin Kahle:

So they liked the one that I chose better than the other two for a variety-

John Warrillow:

Why? What was it about?

Dr. Kristin Kahle:

Yeah. I think for me it was certainly, the cash up front was key. The stock was key.

John Warrillow:

So the deal terms, just remind me what they were offering in the weight multiple of EBITDA and deal terms.

Dr. Kristin Kahle:

Yeah. 8% of EBITDA and 90%-

John Warrillow:

Assuming just to be clear. So you mean eight times.

Dr. Kristin Kahle:

Eight times, and 90% cash up front, a contract for five years, signed a five-year contract. And then after my five-year contract, I have a to Age 65 contract. So I have a retirement plan built in, and then stock.

John Warrillow:

Slow down for that. Just say that last part again, 2H-

Dr. Kristin Kahle:

To Age 65.

John Warrillow:

… 2H65. I don’t know what that means.

Dr. Kristin Kahle:

A contract to working to age 65. So I have a guaranteed job or a guarantee income to age 65.

John Warrillow:

And what are the… So I got to unpack that. So five-year contract-

Dr. Kristin Kahle:

Then it converts to Age 65 contract.

John Warrillow:

Okay. So five-year contract. Are they able to fire you for anything for any reason over that five years?

Dr. Kristin Kahle:

No.

John Warrillow:

So as long as you show up for work and don’t do something heinous, like you being able to be fired for cause-

Dr. Kristin Kahle:

Correct. No embezzlement or any of that kind of stuff. Correct.

John Warrillow:

… they are obliged to pay you for five straight years.

Dr. Kristin Kahle:

Correct.

John Warrillow:

Got it. That’s helpful. And then the 90% upfront. What was the other 10%? Is that tied to performance or what was that?

Dr. Kristin Kahle:

So 10% came in stock value. So that was where we equated this to stock value. And then the to the age 65 is once I hit my five-year contract, obviously I’m not 65. I mean, I’m young, but I’m not age 65 yet.

So what it does is it gives you a contract that if you wanted to leave or retire, you would give them a year notice in order to then say, I’m pulling out of my contract at age 62, or age 61, or age 59, or whatever age it is that you wanted to retire. So having that was also something long-term because I am very young. So having that was also sort of a little bit of a security blanket as well.

John Warrillow:

This sounds great. I got to set me up a benefits consulting company. This is great stuff.

Dr. Kristin Kahle:

It’s a great company that bought me.

John Warrillow:

Yeah, it sounds like it. So let’s talk about the other two offers. So the one you liked was eight times EBITDA and 90% for a five-year contract. What were the other two offers like?

Dr. Kristin Kahle:

Yeah. Pretty similar. The kicker was really sort of around my contract and my stain in the business, right? So it was really around they could terminate you at any time, they weren’t going to give me a to Age 65 contract. There wasn’t going to be sort of that type of guarantee if I wanted it.

Again, I may execute it, I may not. It just depends on sort of what it looked like. But the age that I was selling, I felt like I needed to have some kind of guarantee of, I just built this business and they’re not going to boot me out the door either. So with some kind of non-compete, right?

So I think when I looked at it, it was really sort of the best of both worlds that gave me the cash flow that I wanted on a routine basis with some kickers of sales, which I also wanted, but it also gave me some security, which also helped my husband.

John Warrillow:

Okay. So the five-year contract, was that a salary, salary plus performance incentives? How did they structure that? Because that could be a big part of your overall compensation.

Dr. Kristin Kahle:

Yeah. So salary plus performance bonuses for sales. So it’s a quarterly bonus for five years.

John Warrillow:

Got it. And you are two and a half years into that.

Dr. Kristin Kahle:

Two and a half years into it, yeah.

John Warrillow:

And what’s that been like for you couple of years working in your own company?

Dr. Kristin Kahle:

It’s been great. I mean, certainly it has been… The positive side is certainly everything I spoke about. It’s also been great for my employees to be under a larger company, have some of those protections of the company, has some progression, right? We’ve got some training and some things in place that as a smaller business, maybe we weren’t able to offer.

So having some of that vision for sure. I did it, remember, as a strategic sale. So being able to have more sales people, and the company that bought us has bought 40, so now we’re up to 52 other firms. So I have all these partners built in of cross sales that are coming through from those cross sales elements. So having an entire sales staff in place.

So the strange part, or the bad part, or the whatever, because there’s always that that comes along with it, is now we’re a big company, right? So how do we work and operate inside of a big company. That certainly was with some challenges, of course, right? We always did this way. Now we have to go through these three people in order to get that kind of permission, those types of things that come with it.

And so I think there’s also some challenges when I look at 51 partners and we’re only having 30 of them to do work with. How do I get the other 20 of them that we can actually do work with. And so sort of how do I steer that ship or really sort of get a relationship with that. So we’ve got good and bad playoffs for sure.

John Warrillow:

Yeah. You mentioned that you were up to 47, but now around 30 or 20. So presumably there was some-

Dr. Kristin Kahle:

Yeah. 20.

John Warrillow:

… Was there redundancies, or did people leave? Or what would cause the contraction number of headcount?

Dr. Kristin Kahle:

Better technology. So it didn’t necessarily need a person to push a button or push a widget. Now we had better technology flow that it automatically went through the process. So really for technology, I’m always trying to improve that and I’m always trying to ask my employees, what do you need? What do you need to do your job better? What can we do inside the system to do it better? We’re always asking our clients and our customers that as well.

John Warrillow:

Got it. How did you tell your employees that you’d sold the company?

Dr. Kristin Kahle:

Yeah. So I wanted to do it in person, which was important for me. So obviously, this was before COVID. So I wanted to do it in person. And I had told my senior leadership team first. And what I had done in the sale as well is I had negotiated some stock portion for my senior leadership that came from my pot and my bucket in order to keep my senior leadership and have them have an exciting adventure with that as well.

So I told them first. I gave them a week to digest it. I held office hours and had any kind of conversations that they wanted to have with me about it. So I certainly gave space for that. And then we gathered everybody together, and we were on camera. This was, again, before Zoom and all that other fun stuff.

We were on camera for the ones that were not here in the office. I have two physical office locations, but employees all across the United States. And then we had the conversation about why we sold, what we were doing, who the company was. We had a company representative there as well to talk about how excited they were to bring us into the fold.

John Warrillow:

What was the hardest conversation you had with an employee?

Dr. Kristin Kahle:

Yeah. So I had a employee that had worked with me for all three of my businesses and her role was operations, and that was going to be redundant in what we had to do. So I knew that she would make it through the process of the merger and that whole process, but I knew her time was going to be limited based on sort of where we were at.

So I was open and honest about that conversation, but that really hurt. I mean, that still hurts me to this day. We’re still friends outside of business. We were friends a long time. We worked together a long time, but certainly moving my operations to New Jersey and having that person that I had to terminate, that was probably the toughest thing that I had to do.

John Warrillow:

Yeah. It’s interesting. I did an interview with a guy named Bobby Martin years ago, built a great company, First Research. He wrote a book called The Hockey Stick Principles. Great guy. Anyways, when I talked to him about his biggest regret, it was not thinking through the conversations he was going to have with each of his employees.

And it turned out years later, he felt like he would like to have a do-over on some of those conversations. With retrospect and water under the bridge, time goes by, would you do anything differently about that conversation? Or do you feel like you nailed it?

Dr. Kristin Kahle:

Oh gosh, you never feel like you nailed those conversations. At least I don’t, right? So would I do something different? Yeah, I would. I think I was as open, as honest as I could be in that time. There’s always some things that you have to keep close to your vest.

So I don’t know if I should have started the conversation earlier, or I should have given her a contract that said help us get through the merger and then be done instead of sort of weeding it out and doing all of that.

And I think to some extent she knew it was coming. I mean, we knew it was coming. We had this entire operation team just like we have this entire accounting team in New Jersey. So I had multiple redundancies on those types of things. So they knew it was coming. It’s just really always hard to do.

John Warrillow:

Got it. Help me square something because as I hear you talk, part of my… there’s a few cycles in my brain that are like, “How is this woman staying in this company for five years?” You seem like a super entrepreneurial person. Great for your running me.

I want to be an insurance person. Then you start the company at 18. When everybody’s getting their driver’s license, you’re getting your insurance license. You start two other businesses. By the time you’re 30 or so, I don’t know how old you are.

Dr. Kristin Kahle:

I’ll take 30. I’ll take that.

John Warrillow:

Okay. But by the time to get there, you’ve started a lot of businesses. The idea of five years for you is 35 years for most people. I don’t get it. That’s rare for me.

Dr. Kristin Kahle:

It’s a great question.

John Warrillow:

That’s rare for me. I don’t get it.

Dr. Kristin Kahle:

So one of the things that I said that I wanted access to is the people that sold, and what they loved, and what they didn’t love. And the company that I sold to ultimately sold too. The one theme that kept coming through was I was an entrepreneur. I started my company and I still run my company. I make every decision there is. I have to jump through hoops to get somebody on email. I have to jump through hoops to get a computer.

I have to jump through hoops to get my stuff with regards to my lease and those types of things done, right? I jumped through hoops on those types of things. But what I didn’t jump through hoops are the decision-making things. So for me, it was really honoring my entrepreneurial spirit and keeping my value of being able to run my company how I wanted to run it.

And I could justify it to the senior leadership team, or justify it to the private equity board, but I still had the authority to do that. So when you asked me how I made the decisions as well, the other two that ultimately went by the wayside, I didn’t hear the same theme.

So for me, it was really sort of that, how can I keep my spirit doing what I do best and motivate the people that I need to motivate and doing with regards to running my team and making the decisions inside of a bigger team, if you will. And could I do that here?

And I’m here to tell you that that has all panned out as they have honored all of my request with regards to what I want to do. We may argue about it like brother and sister, we may fight about why we did things whatever way we did it, I may have one more layer of meetings that I have to do that I never had to do before, but when regards to it, I’m still running the ship.

John Warrillow:

So you kind of got the best of both worlds.

Dr. Kristin Kahle:

I really did.

John Warrillow:

You got cash and then you’ve also got to continue to run your company, and you’ve got performance incentives. And so there’s some upside as well. It sounds amazing. Did you buy yourself a trophy? Was there any purchase that you made to celebrate this achievment?

Dr. Kristin Kahle:

Yes. As a matter of fact there was. I bought my husband a new car.

John Warrillow:

Oh, what did you get?

Dr. Kristin Kahle:

He got a challenger, a giant muscle car.

John Warrillow:

Oh my God.

Dr. Kristin Kahle:

Totally. So I bought him a brand new car and he got to pick it out, whatever he wanted. So that’s what he chose, and then I bought myself a watch.

John Warrillow:

There you go.

Dr. Kristin Kahle:

So that was what I chose to buy myself. And I think they equaled about the same price.

John Warrillow:

What was it about the watch? That’s a really interesting thing to go purchase.

Dr. Kristin Kahle:

Well, because I always wanted… I’m kind of one of those people every year I have a sales contest with myself, right? So if I get to X, I get to buy X, whatever X is. And most of the time it’s a product purse or most of the time it’s something else, right? So sometime it’s something that I get to see and touch, right? So for me, I’m visual.

So for me, it was important to have a watch that I could actually look down and say, wow, my blood, sweat, and tears were worth it, that Saturday and Sundays when I worked eight days a week and 100 plus hours, and all those other things, and I didn’t sleep or slept in my office, or all of the things that I did, it was worth it. So I got to look down at my watch to see that.

John Warrillow:

That’s awesome. That’s awesome. I’m not a huge proponent of conspicuous consumption and just buying for buying sake, but I do like the idea of buying something physical like a watch, like a car, something you can touch and feel every day that reminds you of the sacrifice, frankly, and the achievement, which is monumental and incredible.

So congratulations. I love that. I love the fact that you can look down at your wrist every day and remind yourself of that. Before I let you go, just tell me a little bit about NOtivation, the book. Why you wrote it, where you can get it, that kind of stuff.

Dr. Kristin Kahle:

Yeah. Great. So I’m a award-winning author and a bestseller author. What’s interesting about what you just said about The Hockey Stick, He and I actually just put our books into an award winning thing in Canada, and he won the gold and I won the silver. So we tie that together. So that’s interesting about that.

John Warrillow:

That’s really funny. Bobby won.

Dr. Kristin Kahle:

So I looked to see who won in front of me, and there was him. That’s exactly right. So anyway, NOtivation, it’s NOtivation with a capital N-O instead of motivation. It’s how to use the power of no to make your first million dollars?

So it’s really, truly my story about how I really started all three of my businesses that were over a million dollar businesses, all three of them, some early on, some earlier than others, but in their trajectory, they were all million dollar businesses. And all the people, or all the instincts, or all the things that told me no along the way, and the exercises or the tasks that I did in order to turn their no into a yes in my mind.

John Warrillow:

I love it. I love it. So the book is called NOtivation.

Dr. Kristin Kahle:

Yeah, NOtivation.

John Warrillow:

I’ll put a link to that in the show notes at BuiltToSell.com.

Dr. Kristin Kahle:

Perfect. It’s on Amazon. And I read the book actually. So it’s my voice. [crosstalk 01:01:29].

John Warrillow:

Oh, fun. So there’s an audible version?

Dr. Kristin Kahle:

There is. There’s an audible version. And then I certainly know that it’s on Amazon and it’s spelled my name, Dr. Kristin Kahle, and NOtivation. I’d love you to read it.

John Warrillow:

That’s awesome. Well, we’ll put that in the show notes. Dr. K, it was super fun to have you on. Thank you for doing this.

Dr. Kristin Kahle:

Thank you so much.

John Warrillow:

Hey, if like you today’s episode, you’re going to love my new book, The Art of Selling Your Business. The book was inspired by the cohort of my guests over the years, who’ve been able to negotiate an exit far better than the benchmark in their industry, sometimes two or three times more than I would have expected.

I was curious to understand the tactics and strategies of these entrepreneurs, and what they do differently from average performers. The result is a playbook for punching above your weight when it comes to your business. To learn more, go to BuiltToSell.com/Selling, where we put together a collection of gifts for listeners who order the book. Just go to BuiltToSell.com/Selling.

Built to Sell Radio is produced by Haley Parkhill. Our audio and video engineer is Denis Labattaglia. If you like what you’ve just heard, subscribe to get a new episode delivered to your inbox each week. Just go to BuiltToSell.com.

Outro:

Thanks for listening to Built to Sell Radio with John Warrillow. For complete show notes with links to additional resources, visit BuiltToSell.com/Blog. John is the founder of The Value Builder System™. To find out how to improve the value of your business by 71%, visit ValueBuilderSystem.com. John is also the author of Built to Sell: Creating a Business That Can Thrive Without You, and The Automatic Customer: Creating a Subscription Business in Any Industry. Connect with John at Facebook.com/BuiltToSell or on Twitter @John Warrillow, W-A-R-R-I-L-L-O-W. Thanks for listening.

 

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