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3 Things to Consider Before Shopping Your Business

October 29, 2021 |  

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About this episode

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Leona Watson started Cheeky Food Events, where they offered companies cooking lessons as a team-building activity.

Over 17 years, Watson produced 3,000 events for more than 85,000 people. Watson hit $3 million in sales when she realized it was time for her to start thinking differently about her business.

Several years later, Watson decided to sell, and in this episode, you’ll discover:

  • A quirky hack for getting your team to act more independently.
  • How you may be unconsciously sabotaging your business.
  • How to respond to a low-ball offer.
  • One way to ensure you get the deal terms that are important to you in a sale.
  • An unusual way to sell the idea of Standard Operating Procedures to your most creative employees (download The Definitive Guide to Standard Operating Procedures).
  • A surprising way to calculate your walk-away number.
  • 3 things you need to consider before putting your business up for sale.

About Our Guest

“If you can’t stand the heat, get out of the kitchen” takes on a whole new meaning thanks to Leona’s insights around leadership, teams, and human behavior.

An award-winning entrepreneur, Leona founded Cheeky Food Events, the world’s first cooking team building company. Applying the ‘big business’ skills she learnt during her time with Microsoft and Virgin, she took Cheeky from Start Up to a wildly successful brand, delivering over 3,000 unique team events before she sold after 17 “pedal-to-the-floor” years.

She also observed the best and worst of leadership and culture, witnessing 80,000 work colleagues striving to connect on a personal, team and corporate level. The lessons she shares, including her own epic fails and wins as a business owner, are often hilarious, sometimes cringe-worthy but always real, relevant, and human.

Leona delivers “truth-bombs” that both entertain and pack a punch.

 

Connect with Leona:
www.leonawatson.com

Watch the interview

Want to increase the value of your business by up to 71%?

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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:

This is Built to Sell Radio with your Host, John Warrillow. So you’re looking to sell your business? My guess is you’re actually not. My guess is that you’d like to know that you could sell your business down the road, but right now, you’re busy building it. And if that’s the case, standard operating procedures can be your secret sauce. These are the documents that you need to show your employees how to do their work, and we just developed a new eBook, you can get it at BuiltToSell.com/SOP.

Have you ever been to one of those team building events, where they bring in a chef, and you learn to cook a meal together? My next guest built a business doing exactly that, Cheeky Food Events based in Sydney, Australia. Great business, and Leona Watson built it up to three million dollars in revenue, when she had a bit of a soul-searching moment, and decided, through a sequence of events which she’ll tell you about, it was time to sell.

There’s lots of interesting information in this episode. It made me a little squeamish, because I could see myself doing this at times, when Leona described how we sabotage ourselves and undermine our employees at times. And I think she does a great job, and real candor, talking about how she did that, and continues to do that, in some cases, and has learned from that. She talks a lot about the process of parting ways with her company psychologically, and how easy it was for her to negotiate the sale once she had done that. Here to tell you her entire story is Leona Watson. Watson, welcome to Built to Sell Radio.

Leona Watson:

Hello. Hello from Sydney.

John Warrillow:

Yeah, it’s early in the morning where you are, which [inaudible 00:02:25]. I can’t believe how perky you are for five o’clock in the morning. I wish I was that perky at five o’clock in the morning. Good to have you here.

Leona Watson:

[crosstalk 00:02:34] get up early enough, put some [inaudible 00:02:36] on and just get going. That’s it.

John Warrillow:

Yeah, I guess it’s coffee, maybe, or… I don’t know. I want to hear about Cheeky Foods. What on earth did you guys do with the name like Cheeky Foods?

Leona Watson:

Yeah, we got into a little bit of travel when we… especially in the States. So when I first started, that was back in 2002, the concept of cooking as a team building activity just didn’t exist anywhere in the world. And when I first started this, myself, and two other… two chefs, and I was the marketing business side of the business, but I wanted to present and… We started this business, where we would be doing cooking classes, I guess, but would sell it as a team building concept.

Now, that, today, is like… it’s everywhere, everyone’s doing it, everyone’s doing… But back then, it was zero. Google didn’t even exist back then. You just couldn’t find anything. So 2002, yep, Cheeky Food Events. And so it sort of morphed. And at first, it was very much just cooking classes that we sold to corporates, but then I ended up buying out the other business partners, and then I changed it more into being about… We’d go to a conference, and we’d have, literally, two 300 People at the Hilton ballroom, cooking together at the same time.

I owned 500 knives, and they’d walk in the room, and they’d be like, boom, boom, the music would be pumping, and they’d be… Everyone’s going, “Woo, we got to cook our own dinner.” I’m like, “Yeah, yeah, you’re the celebrity chefs.” And we bring in the company objectives, and the behavior changes that they were looking for. So the cooking was the vehicle, really, to bring people together, it was never about the food.

John Warrillow:

That’s cool.

Leona Watson:

Now-

John Warrillow:

Did you get hired by the brands, like Telstra, or whatever, the company, or was it the event organizer who was trying to put on the event for-

Leona Watson:

Both.

John Warrillow:

… brand?

Leona Watson:

Both. Primarily-

John Warrillow:

Okay.

Leona Watson:

… in all honesty, most of the events were probably direct with the corporates, all the same big names that you guys have got over there. Then there was also professional conference organizers, who would then hire us. And then once they got to know us, then they would just put us into lots of different conferences. Or sometimes it might just be a CEO, or a small company, 10 People, they just say, “Hey, we just got to get out of the office, we’ve just… we’re drowning, we’re exhausted. We just need a little pep up.” Probably, the reason why I can be perky at five o’clock-

John Warrillow:

At five o’clock in the morning.

Leona Watson:

It’s because let it come. That was my job, that was my business. It’s funny, a lot of people… I remember being interviewed when I was in about year five, and someone just said, “How did all this start?” And I said, “Well, this is how I used to throw big lunches.” Everyone would come around 20, 15, 20 people, and we’d all end up pretty roaring drunk. But we’d all end up in my kitchen, cooking together. Lunch would get served at 6:00 PM at night, but no one cared. And no one ever remembered the food, but everyone remembered how they felt. So-

John Warrillow:

And that was the idea.

Leona Watson:

And that was pretty… And that was what I then went on to create with this business. The largest one I did was like 1,000 people.

John Warrillow:

Wow.

Leona Watson:

And I did-

John Warrillow:

So you were doing the selling to these brands, mostly, and to some event-

Leona Watson:

Yep.

John Warrillow:

… organizers, and then you’re bringing in chefs on contract to help-

Leona Watson:

Yep, yep.

John Warrillow:

… you execute or? Yep.

Leona Watson:

So at my largest, I had two full-time chefs. But sometimes we’d fly around. A lot of the events will be held in Sydney, but sometimes we’re in Cannes, we went to Fiji, New Zealand a few times. And we’d literally load onto the plane 400 knives and pots and pans and burners.

John Warrillow:

Wow.

Leona Watson:

And honestly, the logistics, the logistics of it, you’d wake up at the middle of the night, did I pack the potato pellets? And you go, “Oh God.” I think that was an interesting thing, it was a foot to the floor on the sales and marketing, because it wasn’t necessarily something that people bought over and over again-

John Warrillow:

Interesting.

Leona Watson:

… [crosstalk 00:06:38] thing. So that was constant, and then the operations were constant. Probably not the cleverest business model, when I think back, because there was no lever that you could just lighten up on a little bit. You had to be constant.

John Warrillow:

Yeah. It sounds like a real transactional business, where you have to remake every time. I just want to explore something you said earlier, which is that you bought out your original partners. Can you describe what triggered that, and how you guys sorted out equity, and how you dealt with that?

Leona Watson:

Right. So that the first one… Basically, for the first two years, we were just playing. In all honesty, we didn’t even know… I was still doing marketing, contracting. We didn’t really know if we had a product, in my head, that was commercial. So after a year, the first lady left, I think she just wanted to pursue different things, just a couple different ways that we were looking at stuff, nothing major. And then I said to the other partner, “Let’s go.” And he’s like, “Oh, I don’t know.” And I said, “Let’s just try changing it a bit. I think we just… we’re spreading ourselves too thin, we’re trying to do lots of different things.”

And then we were quite… That was when we really took off. And I hired a business coach within that time, as well, because I, personally, was throttling the business, that’s another whole story. But then we got to a point where I really wanted to go in one direction, and we were just… Everything was fine, but just wanted to look at things in different ways. And so we started the process. I said, “Would you want me to buy you out?” And that was pretty much how it started. And then it was… I tell you what was tricky, though, we did not have a shareholders’ agreement.

John Warrillow:

You’re one of those.

Leona Watson:

I’m one of those. It was on the to-do list when we first started, and then we got busy, and then it just… Oh. Anytime I talk with anyone thinking about going to business, before you get a laptop, get yourself a shareholders’ agreement, even if it’s with yourself.

John Warrillow:

So how did you stick [inaudible 00:08:41]. What was the [crosstalk 00:08:42]. So tell me that story.

Leona Watson:

Look, it was not easy. What started out as being a very amicable, let’s chat, let’s work this through did not become that, and it was unnecessary. If we’d had that shareholders’ agreement, we wouldn’t have been getting into this icky place, where they were wanting X amount, I’m like, “That doesn’t even relate to how much we’ve been turning over, let alone owning.” And anyway, we came to a point… My decision was, if I buy him out now, I’m ready to go tomorrow. I got the vehicles, I got the staff, I got the operations, I got the infrastructure, got all my Google stuff, which I was all over. And that was what I decided to do. So I paid a bit of a premium in order to be able to do that. And that was what I did.

John Warrillow:

And so what multiple of… How are you valuing the business, for the purposes of exiting? Was it on multiple of earnings or multiple of revenue or?

Leona Watson:

Are you talking about now, or back then?

John Warrillow:

No, back then, where that partnership-

Leona Watson:

Oh. Well, it had nothing… That was the problem, it had nothing to do with multiples off. It was just a dollar figure that they had. [crosstalk 00:09:48]. Sorry?

John Warrillow:

I was going to say, did you say did you ever come to learn where that number in their head came from, why that number was important to them?

Leona Watson:

It was just a number, as far as I could… that’s what I needed to go. And I’m like, “Oh.” So it just did become tricky. They’re great people, don’t get me wrong, it’s just that… I tell you, get a shareholders’ agreement. Get a shareholders’ agreement.

John Warrillow:

Well, a lot of people are listening to this and saying, “I’m in the same boat, I don’t have one, and I’m at odds with my partner.” So they, obviously, had a much higher number in mind, you thought that’s totally crazy. How did you get to a point of compromise? Did you have a mediator, did you go back and forth a bunch of times? What was the-

Leona Watson:

Yeah, we had a lawyer, and we both had… we both had lawyers, and we had the same accountant. So that wasn’t particularly easy. But he stopped the negotiations for me to get set up as a trust, so that when I could sell later, I wouldn’t be hit with a capital gains tax, just a tax thing in Australia. So that just stopped things on a little bit of a roll. In the end, it boiled down to… I just said, “This is what I will pay,” it was less than what they were asking for, but more than what any relevant multiples would be, and I just made the decision that that’s I would be prepared to pay.

The decision was that I was in business the next day, with staff, with the systems, to just keep business turning over. And the fact was that because we changed a bit of the direction a little bit, the business almost doubled in the next… I’m sorry, no, we hit the GFC, with the global financial crisis back in 2008. So we hit that for a little bit, but then the business just really took off. And I made the money back in like about nine months, the additional. So that’s the decision, you have to make at that point. What are you prepared to spend in order to have the life and the business that you want? And then what are you prepared to do, above and beyond, in order to claw that back? And I just worked my ass off. That was it.

John Warrillow:

You mentioned a relevant multiple. Like, what multiple, and this can be up to present-day, would a company like that… I’m assuming it’s a relatively modest multiple of profit or EBITDA. Because it’s transactional, there’s no recurring revenue. So did you have a sense of what was a reasonable-

Leona Watson:

Yeah, I think [inaudible 00:12:32] the industry things seem to be around that three to four for-

John Warrillow:

Okay. [crosstalk 00:12:36]. Times earnings.

Leona Watson:

Yeah, what’s basically a service-based business.

John Warrillow:

Yeah. And so you thought that was reasonable, and they were somewhere else, and… yeah.

Leona Watson:

Yep, yep.

John Warrillow:

Got it. Okay. That’s super helpful. So you got out of that. You mentioned there was a pivot to the business, which helped it accelerate after the GFC. What was the pivot?

Leona Watson:

I think there were two things. One was that I sort of… Because I made the decision… So I got a business coaching, and I just said, “Get me out of being the center of the universe of this business.” I created it, it was all to make me feel important and fabulous, that every decision had to go through me, and all I was doing was just annoying the bejesus out of my staff, and throttling the growth of the business. So that was a that was an additional investment in the business, and then myself and my own leadership skills, which were pretty shaky, best of time, time sometimes.

But also, I just… I invested in some new staff. Not new staff, some extra staff, and just let them roll with things a little bit. And it got to the point where one year, when I was at the peak, we did about… was it 363 events in the one year? And I remember once, one of them said, Oh Leona, you’re micromanaging.” And I just said, “Well, we just did 360 event.” I only knew about 25 of them. The rest of them were marketed, invoiced, you booked the chefs, booked venues, negotiated prices, bought the onions, and all the meat, all that kind of stuff, got it delivered, did the referral program, and I didn’t know anything about it. That is not micromanaging, but it was a perception. But it was interesting that… But what I did was I kind of… I tried to let go. I got an EA, actually. That was a big difference.

John Warrillow:

Executive assistant, for folks who don’t know that-

Leona Watson:

Yeah, executive… yep. And-

John Warrillow:

[inaudible 00:14:29].

Leona Watson:

… also, I started staying at home in the morning. So this was an interesting thing. So I started exercising, which… just as opposed to getting up and then just getting on my laptop, and then annoying everyone why they all came into work, and there were seven or eight emails from Leona. I just cringe when I think that back. But anyway. And they would just hang their head and go, “Oh.” But also, what happened was in order to try and not… I said to them all, “You’re all smart people, stop coming to me with all the questions. I’m just making this stuff up, as well. There’s no manual on how to run this business. It’s not like, here’s how you basically run a hairdresser, or a real estate agent. There’s no manual. We’re in the events industry, so everything we do is new. And this business doesn’t exist anywhere else in the world. So, I’m making stuff up, you can make stuff up.” [inaudible 00:15:22]. They’re all smart.

And so what I said was, if you come to me with a question, come with least two ideas what the answer might be, and then tell me why… which one you think is the best. And of course, they’re all scared for a little bit. And not scared, but just hesitant. And I’d go, “See, you already had the right answer, so you don’t need to come and see me about that again.” And I’d dig down to see what their decision making was behind it. And so I started not coming into work until 11:30, 12:00. And if you’re not around, people just make the decisions and keep things rolling.

John Warrillow:

A lot of people-

Leona Watson:

[crosstalk 00:16:00]. I was all about [inaudible 00:16:00].

John Warrillow:

A lot of people listening to this would say, “Okay, that’s nice, Leona. But if I didn’t show up till 11:30, my employees would never… they’d be late, they would turn up late, they would question my commitment to the business. Because if the boss shows up at noon-”

Leona Watson:

Oh, it was working, but they’d also know that I might work till midnight. So-

John Warrillow:

[crosstalk 00:16:25]. Did you send emails late in the evening, just to prove you’re working?

Leona Watson:

No. Sometimes I’d be at an event, and I wouldn’t get home until one o’clock in the morning. Because I told them what I was doing, it wasn’t just that I said, “This is me, basically, handing over the business to you guys for…” It was a sign of trust. And I think they’re all there. I’m pretty sure they’re all there. I could see emails and things happening, so… And there was no working from home back then, it was everyone in the office.

John Warrillow:

Was it an iterative…. You’re describing it as kind of ripping off a band aid. You came to this point, and you said, “Okay, I’m going to start exercising, I’m going to stay at home until 11:00.” I guess, I’m wondering, was there a triggering event that made you make this change, or was it more gradual, evolutionary?

Leona Watson:

Oh, just thinking back. I think part of it was around the coaching, a little bit, just what can you do… what can I actually do to show trust in the staff? That was a major one for me. And I think it was a gradual. I think there was one trigger. But I also know myself. We were all in one big, open plan area, and we were starting to burst out of this space. And we also had an area, just on the other side of the wall. [inaudible 00:17:55] a soundproof wall, but the door would just keep opening up, with chefs coming in. We would actually be running some cooking parties.

So you’d hear people screaming, and yelling, and the music, and [inaudible 00:18:05], and everyone’s like, no cooking is getting done, a lot of dancing. And that created a vibe and a buzz in our office. But also, when I was there, I could also create a vibe and a buzz. But I could also be ridiculously distracting. I had two staff around here from last week. When I got out of lockdown, I had some people are in my home, UPIA. And they just used to lock me in the office. This is towards the end. They’d lock me in the office and just go, “We got to get stuff done. Just stop distracting us.”

Now, that was great respect and genuine care and like for each other, but I think there’s a point in every entrepreneur… And I’d say it’s a tough point, where you’ve got to just let go a little bit. And for me, I think that if I wasn’t there, then I couldn’t overhear things, because I wasn’t in an office, I was in an open plan space. And it’s so hard…

You hear someone saying something, you hear a salesperson on the phone, and then you just… you can’t help but go and add the little sprinkle that you think is on top, which totally means that they just get deflated, because you’ve taken away their decision, you’ve taken away what it was that they said or did, and all of a sudden, that idea that they were discussing in the office, that they were going to die on the sword for to execute, you’ve just made it your idea by saying, “Oh, and if we do this, this, this…” And then they just go, “Yeah, not interested,” because it’s not their idea anymore. So I started to recognize these traits with myself, which I’m still guilty of, I got to say, but I just… Yeah, that was a major thing.

John Warrillow:

Physically being a way helps. And then when you were interacting with people, you said, “Look, come to me. I’m making it up, so you make it up. Make it up, come with two suggestions, and then we’ll talk about whether those are the right suggestions.”

Leona Watson:

Yeah.

John Warrillow:

I love that. Some people are listening to this, saying… in particular, this job environment, where the labor market’s really tight, employees have more power than they ever used to, they’re jumping around at all different companies. Some people are saying, “Yeah, but as an owner, employees want to learn from you. Employees want coaching, they want guidance, they want to learn from you. And if they feel like they’re stalling, or not learning, they’re going to go find a job somewhere else, where they can learn.” I guess my question is, how did you remain hands-off, let them figure it out on their own, you make it up, and at the same time, provide them with the coaching that they needed to get to the next level in their careers?

Leona Watson:

Well, they would still come to me for things. It wasn’t like it was always… Don’t get me wrong, I was not 100% hands-off at all. I just wasn’t around for two hours in the morning. And that’s often when people are quite creative and active, and they’ll come in… Say, if they start at 9:00, they’ll come in, they’ll stuff around for the first half an hour, talk about what they did last night. And then that’s when most people are pretty productive. And so if I was out of their way, they just got stuff done. But I was still around in the afternoon, we were…

I involved them in every single recruitment. I had pretty wild recruitment process, but the final step was, they came in, and they sat down, and they had a drink in the office with the staff. And I would just sit them all around, and then I’d go, “Look, you guys just start chatting. I’m just going to go over here, I’m just going to do something quickly online on my laptop.” So I was [inaudible 00:21:30], but I was in the group, and the person would think that they were pretty much in the bag, because they’re coming in and having a drink.

And then they would just start asking, “Oh, weren’t you on your holiday last time?” And then the staff, pretty much, had the final decision on whether someone was a cheeky person, or whether they weren’t. The brand culture was pretty strong. And even the chefs, who were contractors, all of a sudden, I’d say, “What happened to Harry, the guy who came to us from blah, blah, blah, blah, nah?” No, not a cheeky chef. Like, “Oh, okay.” So they were actually self-selecting some of the staff themselves, which was-

John Warrillow:

[crosstalk 00:22:06]. What made the cheeky chef, or a cheeky employee? What were the attributes-

Leona Watson:

So I took all my staff away for… After I bought the business, I took the key staff, all of them, actually, away for a conference, and we worked on our key values. And the two key values were, fun and professional. You can’t be all fun, otherwise, it’s frivolous, you don’t get anything done. But if it’s all professional, it’s boring. And we were in the event engagement industry, team building, fun, creating connections between people. So those two always had to go together. So that had to be it. Then it was warm and engaging.

So people who could tell a story. I didn’t want someone to go chasing bad debt and ring up someone and go, “Hey, you haven’t paid your bill.” I wanted somebody to ring up and go, “Hey, it’s such and such here from Cheeky Food Events. I know you’ve probably forgotten it, but if you’ve got your credit card there, let’s get this done.” Everyone had to be the same. And they helped create those values, so therefore, they lived by it.

The other thing was, when they were involved in the recruitment process, they, again, would go to great extra effort to make sure someone was on boarded well. All those [inaudible 00:23:25] minutes. That’s what I struggle with now, how people are all working from home. They got a minute. If you got a minute, they got a minute, they got a minute, they got a minute, that’s when you learn all the cultural cues, and that’s when your productivity goes up, just by being able to walk past someone’s desk and say, “Hey, you got a minute?” That’s a big issue at the moment. That was it.

You had to be able to problem-solve on your feet. You’re standing there in front of 200 people on stage, and you notice that five barbecues are alight at the back. About to set the curtains on fire. You don’t freak out. There was just a… definitely problem solving, smiling, regardless, and having a good laugh about it afterwards, when it’d all gone wrong, and just-

John Warrillow:

Speaking all going wrong, I understand there’s a story associated with you trying to sell a company, and it failing. Can we move there now? So I think I’ve got a sense of the business, and the-

Leona Watson:

Okay.

John Warrillow:

… culture.

Leona Watson:

Yep.

John Warrillow:

But I understand you, at some point, reached a point, where you wanted to sell it, and it didn’t… it was not successful. So-

Leona Watson:

No.

John Warrillow:

… maybe-

Leona Watson:

No. Okay. So-

John Warrillow:

A little a bit about that?

Leona Watson:

… there was a point where after I’d reached my peak, the biggest that the business was, and then there are a couple of things that happen there for myself, personally, and for some of the key staff, and it just went into a vortex, I nearly lost the business. Yeah, it was pretty-

John Warrillow:

How much revenue were you at, at the time?

Leona Watson:

I was at 3 million.

John Warrillow:

Got it. Okay.

Leona Watson:

And yeah, just… everything just went to the dogs, lost a lot of staff. Some of them I wouldn’t necessarily reemploy for what the new business was, that I was going to go with, but it was a really difficult time, and dollars were down. I think I was at 12 years. It wasn’t like I’d only just… was giving up pretty early, I was at 12 years on. And I thought, “Well, do I really want to rebuild this again?” That was the question, do I really rebuild this now? Actually, what I’d like to do is maybe look at merging or being bought out with someone.

I still loved what I did, but I wasn’t loving running the business, and that’s… So many of us, entrepreneurs, we’re all enthusiasm, we’re all great ideas, but then the reality of running a business… When we’re taken away from what it is that we loved about what we started, is where the worst in us can come out. And that was something that I learned when we were at our pinnacle, when were at the biggest.

What I realized my staff took great joy in making sure that I didn’t have to go to an event that there were enough chefs to cover them all. But that was the bit that I loved the most. So the more hours away from what I loved, the stupider I became as a manager, and as a leader, and the worst in me came out, it just got dialed up. And-

John Warrillow:

When you say stupid, what do you mean?

Leona Watson:

Just some of the stupid decisions, not really listening enough, would just go on interrupt on stupid things. When I think back, the less needed I was… I was like a naughty child. The less needed I was, like, “Hang on, hang on, hang on. What about me?” They had an office built, that I was locked away, and so I didn’t hear what was going on. Oh, God bless them all. They were such fun people, but it went into a negative spin, and yeah, that was a pretty rough old time.

John Warrillow:

I think a lot of people are listening to, this nodding their heads, maybe a little squeamishly, I know I am. The less needed you are, I just want you to finish that sentence, then the more disruptive you became, because you-

Leona Watson:

Yeah.

John Warrillow:

… wanted to feel needed? Am I putting words in your mouth?

Leona Watson:

I think that’s pretty much it. I think that the less important, you are… That’s the point where… And I was looking at bringing in someone as a general manager. So it wasn’t the operations of the business. All the financial reporting… I’m a real numbers geek. Whilst I’m highly creative, I’m also really numbers. So all the reporting, and all that kind of thing would just… But eventually, whilst I’d love it, for little bits, doing it full-time, the running of a business of that size, with so many moving pieces, I wasn’t enjoying that anymore.

And then if I wasn’t getting the hit of doing the reason why I started the business in the first place, which was throwing these fun cooking parties, then where was the joy? And if there is no joy Leona is not a fun joy to be around Leona. I was-

John Warrillow:

Got it.

Leona Watson:

And the worst in your personality, everything just gets dialed up. So when everything’s tickety-boo, the best of you get dialed up. When everything’s going south, the worst of you gets dolled up.

John Warrillow:

So-

Leona Watson:

And as a manager, you learn how to take those edges off.

John Warrillow:

Yeah, yeah.

Leona Watson:

I think.

John Warrillow:

Or at least recognize it in yourself, when it’s coming. So you reached 3 million in annual sales, and you mentioned some things happened to you personally, but also in the business. Personal stuff aside, but in the business, can you point to anything… any one thing that caused the business to start spiraling downward at that point?

Leona Watson:

Yep, there were two… definitely two things. So one was we moved office. We had a cooking space, party space at the front, and we were all on top of each other, we were crammed. I was happy with it, but I know that the staff were getting… So we moved the offices over the road, literally. But all of a sudden, we’d gone from having the vibe of everyone screaming, and yelling, and cooking, and the door would open, the soundproof door would open, and you’d hear-

John Warrillow:

[inaudible 00:29:26].

Leona Watson:

… Dancing Queen going off. So that would lift everybody in the office, as well. And the sales process. [inaudible 00:29:33] oh, what’s that noise? Oh, that’s just a party and action. Conversion rate, tick. There was all of that. I think there was… I think we moved, and we lost a little bit of that. I was going through something personal at the time, then there was a couple of key staff members, and it just happened to be all at the same time. All gorgeous people, but just all things that happened. So I did not step up as a leader and manage that, I just didn’t even know how to step in. I was in a bit of a world of pain on my own.

In the end, what I did was I actually took myself off to a health retreat. And I remember booking myself in there for eight days, over in Thailand. And on day two, I’m just getting around huffing and puffing, and like, [inaudible 00:30:25] this is all rubbish. And then day four, I booked myself in for an extra 10 days. And it was the single best thing I’ve ever done. And so all of a sudden, I could remember what it was like to be me, to be nice, to be fun, to be warm. And when I came back, a few more staff left, but I was just in the right headspace to manage that. Like, okay, that’s fine.

And then I went along with that for a while. But then that was the decision then, was, do I want to keep doing this like this, or do I want to build it again? And that was when I went out and… My background’s sales and marketing, I was a consultant to Microsoft, helped launch Virgin Mobile here in Australia. So that’s obviously my game. So when I packaged Cheeky up to go and sell, I remember presenting it, and going “Damn, this is a good company.” And I literally sold it back to myself in a roundabout way. I talked myself back into it.

But if I’d been given a really great offer, I would have gone with that, but I wasn’t. I was actually given an offer by someone who I knew quite well, that was actually quite insulting. But I didn’t know enough to know that that was just part of the game, either. So I just went, “Screw you.” [inaudible 00:31:45], but screw you, I’m taking my business back. You just watch me. That little fire that had been pretty much flame out for a while got… And so I started getting back more into…

I’d done all the NLP coaching, training, and just myself on performance and leadership, and I got a really good couple of people into the company, and that really energized me. And I’m all about managing your energy levels and things, especially when that’s our business. And then, I was… I got to a point where had a good little team. So I sold it back to myself, kept going, had a great little team, really enjoying it, did some more big events. And I had been in Entrepreneurs Organization.

Funnily enough, I left Entrepreneurs Organization probably when I most needed them, which was when everything was in that downward spiral. I think I had just retreated. And I know so many… As business owners, we just tend to go within ourselves, because we don’t even know how to say what we’re feeling. Partners, and family, and friends, I don’t want to hear it, I don’t even know what all of that… You don’t even know how to say what it is that-

John Warrillow:

Sure, sure.

Leona Watson:

… you’re going through, so you feel a bit of a failure and all that kind of stuff. I decided to go on long service leave, which in Australia is, you basically get 10 weeks holiday after you’ve been working for a company for 10 years. So I just thought, right, I’m going to take 10 weeks leave. And I’d had some pretty good holidays over the time, I wasn’t a complete [nada 00:33:19]. So I took 10-

John Warrillow:

Wait, you lost me a bit in the story, because you went on the health retreat, you came back refreshed. You said, “Okay, I’m going to market the business”, you got a crappy offer, and you’re like, “I’m going to do it,” but you’re like, “Thanks, but no, thanks. This is a great business, I’m going to do it myself.” So you’re full of energy, you’re going to go-

Leona Watson:

I’m full of energy.

John Warrillow:

What’s the-

Leona Watson:

Went on for about another three years.

John Warrillow:

Okay.

Leona Watson:

And what I did… I’ll tell you what I did. And I started getting serious about doing my triathlon, so I’m up and I’m training every morning, so my headset’s clearer. And I made a decision I was really happy with just a couple of staff, and then contractors. So I went from being 3 million, to probably around about one, one and a half. And can I tell you? My profit was not quite as big, but my life, 10 times happier.

John Warrillow:

Hmm.

Leona Watson:

And that was a decision that I had to make, and I had to let… Do you know what? You have to let go of the ego of, what’s my turnover? Oh God, we just… Yeah, I had to let go of that, and make it more around, what am I taking home? And I didn’t really care too much. As long as I had enough for a couple of overseas holidays a year, and I could buy myself a new bike, and I could… I’m not I’m not someone who needs lots of brands and things around me, I’m a bit of a nature girl like that, so…

So I was happy I was, sitting sweet. And I went on this 10-week holiday, I did a half marathon around Uluru, with Rock, and then went to Paris and Bali. And then I was in Italy, and I noticed that the sales were starting to go down. Anyway. And I was sitting there, and I was on my own at the time, and I was on about my fifth Aperol Spritz and [inaudible 00:35:06]. I was getting there. And I’m looking at the numbers, and I’m going, “Okay, this is a business model problem. This is not a salespersons problem, this is a business model problem.” Which I always knew.

So I’m sitting there, on the back of the coaster, just going, “Okay, so I’m going to have to spend, blah, blah, do this, do this in order to build the business again, and to solve this problem, or I sell.” And that was what… Or I sell. And I went, “Oh, or I sell. Am I ready to sell? I’ve been loving the business the last few years.” And I let that sit there. And then I let it sit for about two weeks, for the coming holidays. It grew, it grew. And I went, “Maybe it’s time, it’s 17 years. And while you’re enjoying it, leave. As opposed to, wait until you’re in a negative space, and then trying to sell it.”

And the turnover was okay, the profit was okay. It was sitting sweet. So I snuck back into Australia a week earlier than anyone knew about, came in, got my laptops and everything, grabbed a flip chart, Airbnb’ed a place an hour out of town, and just locked myself in, and just did a whole bunch of what-if scenarios. What if I built this? What if I got a business partner in? What if I merged? What if I sold? And then also, the big one, who am I going to be if I don’t have this business, like, the whole identity, loss of? I had to go around… A bit of another second story, but… And then I came out of that going, “Yes, I’m ready to sell.” And I had a bit of a number in my head. And oh, if I didn’t get it, was I ready to walk away, just close the door and go do something different?

John Warrillow:

I got so many questions. I’m going to stop and just start asking some questions. So let me go… I want to go back to the lowball offer. So when you bought out your partner, you’re thinking, three to four times earnings is fair. It’s not-

Leona Watson:

Yep.

John Warrillow:

… top end, it’s not bottom end, it seems about fair for a service business, transactional service business. What was the lowball offer for in a multiple of earnings?

Leona Watson:

Which offer are you talking about? So-

John Warrillow:

The one where you said, screw you, I’m going to-

Leona Watson:

Oh. [crosstalk 00:37:23]. That was about point two earnings.

John Warrillow:

Times earnings.

Leona Watson:

Yes.

John Warrillow:

Okay. So that’s easy to say no to. Like-

Leona Watson:

But let’s say I made a million a year profit, which I wasn’t. But let’s say I made a million a profit, they offered me 200,000.

John Warrillow:

Right. Got it. Okay. So that’s easy to say no to, I get that.

Leona Watson:

Correct. Yeah. So-

John Warrillow:

But it fired you up enough to-

Leona Watson:

Absolutely.

John Warrillow:

… reenergize you. Got it, Got it.

Leona Watson:

Absolutely.

John Warrillow:

So then you’re at a million, million and a half-ish, but almost as much profit as you were making. But 3 million in lifestyle was 10X better than it was before, because you got rid of a lot of the staff. Okay, got it. So you got a couple of employees… Gosh, this is such an interesting story, because I think so many people are on the revenue hamster wheel. Their ego is definitely defined by how much revenue, and that is… that’s still the way many entrepreneurs know who’s the most-

Leona Watson:

Hey-

John Warrillow:

… important person in the room. Right?

Leona Watson:

… I was totally guilty of it. But there’s a point where… I did a bit of personal development stuff along the way, as well, when I did all of the NLP stuff in everything, too. But there’s a point where you kind of… I don’t know, is it grow up? Grow up in a way, and you start asking the bigger, tougher questions. And you’re going to be ready to answer them of yourself, too. And mine was, was I happy? No, I wasn’t. I was bloody miserable running that business for a while there. I learned what it was that we did, but I was miserable. Not miserable, that’s a tough word, but it just wasn’t bringing me the joy of doing it.

And so what are the options then? And what do I need to… What I got to do to make this work for me? And I just had to let go of the turnover, and just make it more… I did a couple of things. Number one, I added some KPIs, I put some KPIs around it. So [crosstalk 00:39:27] did less of… Also, the other thing that was happening in the industry… And I didn’t expect to be in business this long, because I thought as a typical product model, it will get to about eight to 10 years, and it’ll start to flatten out, become a product price option, and that’s it.

We were like three times the average price of what anyone else was doing in the industry. Which was quite different to what your book would say. A lot of the stuff that we did was quite customized. Like 95% was the same thing, but it was the 5% cream on top that we did, that people paid those multiples of to have us back again, or the… 78% of our business was referral. So what I did was I set the KPI, less events, but bigger events. And they’re the ones that I enjoy more.

So guess who was able to convert more leads to sales, and then get involved in… And so the things that I really loved, I bought back into the business more. And at the end of the day, if… And then I was right back in the business, I was 100% hands-on. And if I’m going to be there, it has to be something that’s going to be… Because we are the… [inaudible 00:40:38]. I know that on the barometer of the business, and I would try and stop myself every time I’d walk in. Am I bringing an argument I had, something, into the business today, and I just have to…

A bit like you saw me this morning, when we first started talking. 5:00 AM in the morning, chippy chirpy. I had to make a decision to be… Am I going to be someone who’s just dragged their ass out of bed and just turn up to this? No, I’m not. That’s disrespectful. So I’m going to put some lippy on, try and do the five-month old here, that’s [inaudible 00:41:09] that’s coming out of lockdown. And that was what I did.

John Warrillow:

I love Australia, because you always have crazy names for stuff, like-

Leona Watson:

Right.

John Warrillow:

… Cheeky, and lippy, and… I love it, I love it.

Leona Watson:

Like-

John Warrillow:

All right.

Leona Watson:

We can’t get the full words out, we’ve just got to-

John Warrillow:

Yeah, know exactly. Okay. So I’m with you so far. So you had this awakening, I’ll call it. Sounds a little airy, too-

Leona Watson:

[crosstalk 00:41:38]. Yeah, probably.

John Warrillow:

Had an awakening of some sort, where you came to a decision that a smaller business, but one you love, was more important than a bigger business. And so you decided, though, to sell while you were on top. Let’s talk about that. Before you went through the selling process, did you have a sense of what you thought was a fair price for the business, either on a multiple of earnings, or revenue? Did you have a sense what your number was? Did you know what it was?

Leona Watson:

Yep, I had like… Oh. I’d love to say that I had a multiple, though, but I probably had more a dollar figure-

John Warrillow:

What was that based on?

Leona Watson:

Nothing. I’d love to say… But it was just like, what can I live on for two years? Because my plan was, this is the trick. This is what I… I spent a lot of time working on my head, my headset, my mindset for this. And [inaudible 00:42:43]. I do a lot of that be, do, have. Do you guys do-

John Warrillow:

No, never heard of be do have. What is that?

Leona Watson:

Oh, okay. So, what have I got to do? I’ve got to sell my business. Okay. What have I got to do that? I’ve got to get my figures in place, I got to do, do, do, do these things. What do I need to have around me? I need to have a really good accountant, I need to have a good business consultant, I need to have this blah, blah, blah, whatever it is. Okay. Who do I need to… This is the bit that everyone forgets, is, who do I need to be, to be the person who is going to attract and have engaged business consultants and accountants, who are then going to help me do these things and do them well, rather than just drag them along and get them done? Not just going to do, but done. That’s probably an Australian one, [gonna 00:43:25], I don’t know. But, going to do.

I spent a lot of time, I need to be the person who’s ready to have my business, people are going to pick it apart, I need to be someone who’s going to look at my numbers and go, “Oh, look at your ratio here of your cogs to your…” I just needed to be the person who did not give a toss about that. I needed to be a person who was ready to sell their baby. I needed to be a person who was ready to let go. And also, I was fairly well known in our industry. I’d walk into a room, and people would just go, “Hey, Cheeky.” A lot of people didn’t even know my name, people thought I was the business. But I wasn’t, in many ways. Which is a danger, that’s another whole conversation [inaudible 00:44:08] in your business when it comes to selling.

So the number was more about, I want to just take my foot off this 17-year pedal, I want to give my headset a break, I wanted to put a flower behind my ear and go and hang out in a Kombi van, or go and hang out in Bali. And how much did I need to go and do that for a couple of years? That was pretty much… It was all about who I wanted to be in the next realm.

John Warrillow:

And then when you identified that number, and then in the cold light of day, with what you know about the numbers, how did the accounting side, or the math side of you, compare that number that you needed for two years of living on your own, to what it was probably actually worth? Were they close or?

Leona Watson:

Yeah. There was a point where I had to ask myself… Yeah, it was relatively close. It was relatively close. I think he might have thought that he paid a little bit more, I might have thought, oh, maybe I could have got a little bit more. You never know in those negotiations. But I was very clear on why I was selling. Very, very clear. And I was very clear of who I needed to be in that process.

Honestly, I can’t tell you how many times you sabotage things. Us, as entrepreneurs, we set up these little roadblocks. I remember the last time, when I bought out my business partner, I remember sitting there and just going, “What am I doing?” We were arguing over one recipe with three ingredients. That probably cost us $1,000 each in lawyers’ fees. And it was just BS, it was just ego, and it was… And I don’t want to be that person again, that’s just rubbish. And I’m also like 15 years older. Seriously, please don’t be that same person, you think you’ve grown up a little bit.

The other decision I had was, was I ready to walk away and just close? That’s a big one. Because the other thing that was happening, as well, was where I housed my business, that building was literally being pulled down. So a question was, was I ready to go and start another lease somewhere? Because I had to house these 500 knives, and pots, and-

John Warrillow:

I used to see all the knives. Yeah.

Leona Watson:

Yeah. And then I had to have space for bit of a kitchen. So it wasn’t like just renting another office for three months. I had to bring the business into my home. It was-

John Warrillow:

Okay.

Leona Watson:

… pretty horrible.

John Warrillow:

So you’re going through the list of things that you need to be, you need to be ready to let go, you need to be ready to sell, you need to be carefree. If it doesn’t happen, that’s okay.

Leona Watson:

Mm-hmm (affirmative).

John Warrillow:

What was your negotiating theory, as theorists call… Talk about a BATNA, a best alternative to a negotiating agreement, meaning your plan B. If you had not sold the business, would you have closed the doors and got nothing for it, or would… did you have a plan B? Were you prepared to continue-

Leona Watson:

Well, I was prepared to… I gave myself a bit of a timeframe that I was prepared to operate for about the next year. But I would go back and look out into the market for potential mergers. Because-

John Warrillow:

That was your plan?

Leona Watson:

… [crosstalk 00:47:33]. That was my plan B. Yep. Yeah.

John Warrillow:

Got it.

Leona Watson:

And then-

John Warrillow:

Got it.

Leona Watson:

… potentially look at walking away. Because once I’d set my head… Once I’d set my… My focus was on, who do I want to be for this next part of my life? The letting go of that heart connection to my business became much easier. Honestly, because I was so well known in the industry, and attached to this business, people, oh, what are you going to do? Oh, yeah, I might just… I might just do nothing for a little while, and just… And I was, literally, quite open to whatever that might be.

And once you release all those strings that make us… that can cause us to make some pretty unnecessary decisions, or make things more difficult than they need to be… So here’s a story about the negotiation over the number. This is a true story. There’s a bloody Ted talk in this, for sure. Well, literally we went to an event-

John Warrillow:

Sorry, this is the actual sale of your-

Leona Watson:

[crosstalk 00:48:47]. This is the actual sale. Like-

John Warrillow:

Okay.

Leona Watson:

… this is how we actually came to the number. The person who’s bought it, we were actually at an event down in at this place, at this hotel resort, and then I went, “We got to go and get some more food.” So we go out, and I said, “Do you want to stop for some lunch?” And we’re having fish and chips. So in Australia, fish and chips near the beach, it’s a big thing, and it’s deep fried, bad for your heart. All deep fried, and it comes wrapped up in paper. And then you just sit there and open it up and…

And then I realized we were doing the deal, we were doing the numbers. I realized we were really… this is it. And we were literally writing out numbers on the paper that the chips were wrapped in. And that was what we did. And then he just stood up, called his bank, and that was how it started.

John Warrillow:

Okay. So the fish and chips wrapper gets… This is quite a story. So we unravel the fish-

Leona Watson:

We unravel the fish.

John Warrillow:

… [crosstalk 00:49:45]. And what are the numbers you’re scribbling on the newspaper?

Leona Watson:

We’re literally scribbling the numbers that he is going to buy it out for.

John Warrillow:

Okay. So did he write the first number down? He must have asked you how much-

Leona Watson:

Yeah, I’m trying-

John Warrillow:

… revenue you generate.

Leona Watson:

… remember. I think he was trying to get me to say it first. I think I asked him. I think I wouldn’t budge on that one. [crosstalk 00:50:10]. I honestly can’t remember. I can’t remember. I literally can’t remember. But [crosstalk 00:50:13].

John Warrillow:

But did he have a sense of how much revenue you had, how much profit you had-

Leona Watson:

Yeah, he had all my… He and the accountant had gone through all my figures. I had a chat with his accountant, direct, and tell you what, if you’re doing this, that would be… I would strongly recommend that, because I’ve got a lot of the… what the accountant was ultimately going to approve, just what he wanted.

John Warrillow:

Sorry, why would the accountant have any approval-

Leona Watson:

So the accountant-

John Warrillow:

… of anything?

Leona Watson:

Oh, I probably shouldn’t say this, because we’re all in the same industry. But the accountant revealed that if there was able to be a little bit of a payout period, not just money upfront, he would probably almost rubber stamp it, because it was a good business, it was a good business. The numbers all added up. So that was in my head, about how to make this work. And I think we were both around similar numbers. So I think it was the multiples of around, again, that three or four. And I think we were both in the similar area. So it wasn’t like he was saying, “I’m only going to give you a million,” and I’m saying. “I want 10 million.” It wasn’t that sort of numbers. But weren’t that far off.

And so we literally did the whole thing in about 15 minutes. Because when I packaged up the business to sell, and I created about eight different proposals, with eight different… marketing and sales background, so that if I went to a hotel who might want to buy me, if I went to an events company who might want to buy me, if I went to a direct competitor, if I went to someone else who might want to merge, I had all different benefits, and all different ways that when you combine the overheads, how this was going to mean massive, way bigger profits than what I was able to get on my own, just managing all the overheads.

So he already had the figures, and it all adds up. There was nothing wrong with the figures, it was a good business. So we just did that really quickly. And I didn’t fuss, because I was very clear on what my endgame was. I was very clear, do I need to be a real… okay, bitch about this, and just start to go to try and get an extra 10, 20, 30, 50 grand or whatever? No, just get this done. And I can’t tell you how many times, other people I’d speak with and everything, where we can all start arguing over things that, really, just… does that really matter?

And so if you’re really clear on what the end game is… This is what I found for me anyway, this worked for me. The clarity I had around, what is it that I really want, and why, that becomes the magnet, not the dollar figure. The dollar figure can fudge around, but if you’re just hanging on for that last 10k… So the business starts to flounder, as well. It was really a struggle, me having to run the business, literally, in my lounge room, because I didn’t have-

John Warrillow:

What was the magnet? What was it that you wanted to go to?

Leona Watson:

Freedom. Freedom. So I’d had a business, 17 years. Like I was mentioning before, you’re all full on in operations, and I mean I’m flying around with 50 crates of cooking gear, it was a thing, or you’re all over, marketing and sales constantly, just had to have a barrage of leads coming in. And I just needed to rest my head, I think, was what it was for me, and just… and not put any expectations. It took me about a year until I realized I was breathing differently.

John Warrillow:

Hmm.

Leona Watson:

And I went, it took that long. It really took that long to just-

John Warrillow:

You made me take a big deep breath right now. [crosstalk 00:53:55].

Leona Watson:

For me, let’s get our morning [inaudible 00:54:00].

John Warrillow:

So let me ask you this. So what are you guys scribbling on the newspaper at the fish and chips stand? Because you’re pretty close to the multiple, are you now scribbling out pay out terms like, I’ll pay this amount up front, and this amount in three months, six months? Was that what you guys-

Leona Watson:

Yeah, certainly.

John Warrillow:

… were negotiating?

Leona Watson:

I think talked about it at that point. It was like, well… Basically, what it was, without giving away anything, because we’re both in the same industry, and I’m really respectful of what they’re doing, I just said, “If you give me 60% upfront, and then the other 40% gets paid out over 10 months…” I don’t think there’s any problem in saying what that was. We’ll not link to profits, or anything like that.

John Warrillow:

Got it. Got it. It was just-

Leona Watson:

And-

John Warrillow:

… strictly a time-based payment schedule.

Leona Watson:

Yeah. And that was all part of… And so the contract, that was all a massive part of the contract, what happens if he defaulted-

John Warrillow:

Yeah, what was your recourse if he defaults on that?

Leona Watson:

His house.

John Warrillow:

Okay. Did he come clean and pay the 40%?

Leona Watson:

Yeah, yeah.

John Warrillow:

Okay.

Leona Watson:

I got my last payment… Talk about someone looking out for me. I got my last payment on One March, and then the world closed on the 17th of March.

John Warrillow:

Oh my gosh. Wow.

Leona Watson:

How’s that? How’s that? Because [crosstalk 00:55:25] his business… the business had to close for a long time, until they figured out some virtual options. And so I was very… I felt I did my hard yards, and then I was… So that could have got a bit iffy, if we’d gone into that… me trying to get money during that COVID period.

John Warrillow:

Yep.

Leona Watson:

But luckily, we didn’t have to go there, and so that’s that.

John Warrillow:

Hard yards is another good Aussie term. [inaudible 00:55:56]-

Leona Watson:

Is it?

John Warrillow:

… I think. Or Australian rules. Yeah, yeah. We don’t say hard [crosstalk 00:56:00] yards, I’m sure, but it’s great. It just means the tough work that goes-

Leona Watson:

I’ll tell you the other thing that I reckon I did well, some things I didn’t. One thing I did well was I went for everything I wanted in [inaudible 00:56:12]. So I did the first heads of agreement.

John Warrillow:

Okay. Heads of agreement would be like a term sheet.

Leona Watson:

The term sheet. Yeah.

John Warrillow:

… for folks listening in North America.

Leona Watson:

And so I put in there how many hours I would work in the business-

John Warrillow:

After the sale?

Leona Watson:

After the sale. And a restrain of trade, all that kind of thing. And there was no question marks on a lot of it. So definitely be the first one, I think, would be… If someone asked me, do you wait for them or not, I’d say put in what you want. And I knew what I would budge on, and I knew what I wasn’t going to budge on. And-

John Warrillow:

[crosstalk 00:56:46]. What were you not prepared to budge on?

Leona Watson:

How long I was going to be in the business for.

John Warrillow:

Personally working in his business-

Leona Watson:

Yeah.

John Warrillow:

… effectively, at that point? Yep.

Leona Watson:

Yep, yep.

John Warrillow:

Yeah. How long did you agree to stay on?

Leona Watson:

Oh, it was literally 80 hours. Because I’d got it… I’d listened to your book, and I had read your book, and everything, so I was pretty good at creating processes and everything, so there was a lot that was there. And so I just had to take them through how to do the sales and marketing, because it’s quite a unique product, what’s unique about that. P&L, where you can really lose money, where you can make money. That’s just from learning from all my screw ups over the years, of where I’ve lost and made. And the reality was, is that was it. It didn’t need to be much longer. When I talk with every other person who’s run a business and then stayed in it after they’ve sold, was that they never… most of them don’t end up working out the full time.

John Warrillow:

Sure.

Leona Watson:

things start to go [inaudible 00:57:54]. Because you were the owner. You were the owner of that for so long, and-

John Warrillow:

[crosstalk 00:58:00].

Leona Watson:

And I could hear myself getting nitpicky when I was in there. So when I was released halfway along, I just went, fabulous. I think that’s [crosstalk 00:58:11]. Yeah.

John Warrillow:

Thanks for the subtle plug for the book. But you mentioned that you did… rebuilt to sell, and that you built some… just describe what kind of processes you built, so that you could leave 80 hours after you’d sold it. That seems like-

Leona Watson:

It was just that… So because I’m a bit of a spreadsheet queen, and operations, and we had so many checklists and things… And the whole thing we were talking before, about Vern Harnish, and all that kind of thing. And so I learned a few things along the way, [inaudible 00:58:49] lots of things. And so I did get a lot of processes in place. What I got from your book was around the fact that whilst it was a service, and the perception to the outside world was that it was a very customized service, the reality was, it was a product that was replicated over and over again.

And you talked about that in your book, and it challenged me, because I was very proud of the fact that we were… we always did something different for each one. And we did, but the reality was that the guts of it was the same. If you’ve got 25 people, you’re going to need X amount of chefs, you need X venue, you need X amount of onions, that many capsicums, you need that many burners, that many frying pans. And what I would often say to the chefs… like, “Oh, Leona, all these checklists.” And I’d make them tick off every little potato peeler they’d packed. And I said, “But this is what sets you free. This allows you to be creative when you’re there on site, and to be a party thrower, not a…”

And so that was how I… And I think that made it, as a business, that bit easier to sell. And then also, because my name will be forever attached to that business. I started and ran it for 17 years. You want it to be successful, as well. So the easier it is for them to take it up, and to keep it rolling, and then they’ll, obviously, morph it into their own thing, too. It was part of the letting go. That was part of being able too let it go.

John Warrillow:

I love it. I want to ask you a weird question, but I think it’s relevant. And-

Leona Watson:

Okay.

John Warrillow:

… it sounds like you’ve done a lot of work. You referenced NLP, I’ve heard of NLP a bunch, and I know it’s related to language, and how you talk, and self-talk, and that’s about the extent of which I know about it. But I do know a lot of people who… very successful people that are big proponents of it, so I’ll just say that much. You’ve also done a lot of retreat. Seems like you’ve done a lot of work on yourself, and all the stuff that you’ve done. If there were one resource that you think entrepreneurs would benefit from… And I’m thinking of like a book they could read, or… something that would be helpful for them to do some of the self-reflection, is there one resource you might point people to?

Leona Watson:

I tell you who I thought was a trigger for a lot of this, and getting me to think, am I being a bitch about this situation, ar am I just being the boss, or am I… So do you Cameron Harold?

John Warrillow:

Yeah. [crosstalk 01:01:50]. I mean, I don’t know him personally, but I know-

Leona Watson:

Yeah. [crosstalk 01:01:52]. Yeah. So he came out to Australia… He to came out Australia a couple of times. And with Entrepreneurs Organization, we had a retreat, and he just basically ran the whole retreat. It wasn’t bits and pieces of different speakers, he was the speaker, he ran it. And he talked a lot about the mindset of an entrepreneur, and the ups and the downs of it, and understanding where you’re at your best, and when you’re at your worst, and what the activities that you should be doing, and when you need to retreat from the business, and just… If you’re in a really bad funk, do not go into the office. And even got down to the point where a lot of entrepreneurs can be a little bit to the point of being bipolar, or a bit-

John Warrillow:

Sure, sure. Manic, in some ways. Yeah.

Leona Watson:

Yeah, a little bit manic. And it’s all about taking off the bottom, and then taking off the top, and getting back out of the bottom quicker. And I really took a lot of that on board, to the point where I came back, and I said to my second in command, I said, “If ever I get to a point where you think I’m being really detrimental to the business, and I’m not listening to you…” Everyone had my credit cards, anyway, to buy stuff for the business. I said, “Just booked me somewhere.” So if it gets to that point… So basically what I was doing was giving trust to someone, that if I got myself caught in a bit of a whirl, and I was not being of any service to anyone, in fact, I was being right the opposite, get me out of here. Just book me somewhere for a weekend, even, or for a week, and we had that discussion. We had a pretty honest discussion there.

It didn’t have to get used, but it certainly got me thinking about whoever you are at home is who you show up at work. And whoever you are at work is who show up at home. And you just bring the good and the bad and the ugly, it’s just one big flow. You think you’re masking it, but you’re not. We know we think we are, we think we are great actors, but we’re just… You can only do it for so long. And then, when we’ve got the pressures of what’s going on for us, that’s when the cracks start to show. We start snapping at staff, we start snapping at the dog, our families. And what isn’t everyone understand? No, they don’t understand. It’s not their job to understand. It’s our job to understand us, and to make the best of us for the environment that we’re creating as a business, and then for our families, and then for ourselves. And that was what I took away, a lot of that, from that conference.

John Warrillow:

That’s fantastic. Great suggestion. So Cameron Harold, C-

Leona Watson:

With an O.

John Warrillow:

… OO of-

Leona Watson:

[crosstalk 01:04:46].

John Warrillow:

Yeah. And then he moved on, and he’s… I think he’s written a book, as well-

Leona Watson:

Yeah. He’s-

John Warrillow:

… if I’m not mistaken.

Leona Watson:

… written a few books.

John Warrillow:

Yeah. So you could check him out online, we’ll put links to Cameron stuff in the show notes. Tell me about what you’re up to. Can people reach out to you anywhere, if they wanted to say hi on social media, for example, or is there a website?

Leona Watson:

Yeah.

John Warrillow:

Tell us what’s going on.

Leona Watson:

So, as I said, I wanted to put the flower behind my ear, and just take off to Bali, but COVID hit, so I put the flower behind my ear and sat in my lounge room. So what I’ve been doing, I’ve been… I’m partway through writing a book.

John Warrillow:

Oh, cool.

Leona Watson:

One of my 100 short stories kind of thing, the funny, the irreverent, the [inaudible 01:05:39] moments, of which are many. I’ve also been getting more into speaking, as well.

John Warrillow:

Interesting.

Leona Watson:

So how to energize teams, the things I’ve learned from world class chefs, like how they just run a kitchen, the pressure. Imagine being someone who gets Google-reviewed every day, publicly.

John Warrillow:

I can’t.

Leona Watson:

Just imagine that in your head. And then what you can learn from that, and their operational excellence, and take into the corporate thing. But also, because I’ve worked on corporate, and as an entrepreneur, there’s a lot that entrepreneurs can learn from the corporate market. Their ability to create infrastructure to use that to scale is gold. Us, entrepreneurs, we fight that, mostly, to the nth degree, because we want to be free flowing, and we want to be able to innovate on a term, but that’s the stuff that… And that’s great for the first two or three years, but then where most of us tend… Sorry, this is just me saying most of us.

But just from all my conversations with a lot of other business owners, as well, that’s where we tend to screw it up, because we fight putting that infrastructure in, which is what our staff need, or investors need. They need to see… That’s where the scale for growth just doesn’t-

John Warrillow:

Sure.

Leona Watson:

… happen, that’s where a lot of us fall over. So I talk a little bit about that. And also, what I’ve learned from triathlons, and what I’ve… As self-leadership, and as a leader, dodging the sharks on the ocean swims and everything, and then all that, that I took into the business. 100%, I learned so much, and then I just took that straight into the business. So I do different speaking on that, and then also do some… Funny enough, I do some business coaching. But nine times out of 10, the business coaching is, obviously, with entrepreneurs or leaders, it ends up mostly being personal coaching.

John Warrillow:

Hmm, interesting.

Leona Watson:

Because we are dialed… I think there’s a thing, when you’re a bit of an entrepreneur, is that the perfectionism kicks in, which is just a cleverly disguised procrastination. That’s what it is, it’s just very cleverly disguised. And it also sets up a lot of things for everyone else, that just makes no one else feel good enough around you, as well, which means you lose good staff. So I tend to work with a lot of people around a lot of that, and that’s [inaudible 01:08:01] the NLP training, loads of NLP.

The great thing, just on that NLP, is that if you ever get a chance to do any training around it… So I did one that was specific to performance leadership, your mindset around money. It’s great, because you actually practice with each other. And so you uncover so much of your own beliefs that are based, really, on nothing, or what your parents told you. And then you take that through, and it’s like… And then you get to decide to let that go and create something. That’s what-

John Warrillow:

Again, I’m going to better educated about NLP. I feel like I’m talking to my ass want to talk about it, so I’m going to get educated on it. Leona, where do people reach you? Are you on LinkedIn, or-

Leona Watson:

So it’s just leonawatson.com is my website-

John Warrillow:

Right.

Leona Watson:

… and it’s just leona@leonawatson.com. I’ve just got a Facebook page, that’s my personal and my work one, all bundled in together, because I am the brand now, which is an… very interesting, a little bit… it takes a little bit to get your head around that. Imagine phoning out to someone and saying, “Hey, you need to hear about me.”

John Warrillow:

Yeah, yeah.

Leona Watson:

[crosstalk 01:09:18] fabulous. Like, oh, it’s just going to sound cringe. That’s pretty much where you can find me.

John Warrillow:

Awesome.

Leona Watson:

Oh, and LinkedIn, LinkedIn. LinkedIn, obviously. Yeah.

John Warrillow:

We’ll put all that in the show notes at builttosell.com. Leona, thanks for doing this.

Leona Watson:

Thank you it’s been quite good going a little bit down memory lane, and remembering the good, the bad, and the ugly.

John Warrillow:

It was fun, for sure.

Leona Watson:

There were some definite uglies in there, but hey, it’s all part of the journey, huh?

John Warrillow:

Hey, if you liked today’s episode, you’re going to love my new book, The Art of Selling Your Business. The book was inspired by the cohort my guests over the years, who have 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 selling your business. To learn more, go to BuiltToSell.com/Selling, where we’ve 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 Dennis 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 @JohnWarrillow, W-A-R-R-I-L-L-O-W. Thanks for listening.

 

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