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How to Build Your Company to Sell (Even if You Have No Plans To)

November 12, 2021 |  

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Kevin Waldron built Olympic Restoration, a disaster recovery business, to $24 million in annual sales before he decided to sell. Helping homeowners clean up from a fire or a flood was a good business, but after 17 years, Waldron was tired of fighting with insurance companies over claims.

Waldron quickly got an offer of around 4 times EBITDA from an industry contact and has never looked back. This episode is jam-packed with both life and business lessons including:

  • How to build your company to sell (even if you have no plans to).
  • How to know if you have a job or a business.
  • Why getting to 5 employees can be a game-changer.
  • The difference between a “customer” and a “client”.
  • The secret to working with your spouse.
  • The surprising downside of a financial windfall at 42.
  • Why you should avoid using your surname in your company name.
  • The biggest mistake Waldron made in selling his company.

About Our Guest

Kevin Waldron is the founder of Waldron Leadership, a business coaching and consulting company that helps business owners get to that next level of performance. An experienced entrepreneur, Kevin started & grew a $24 million a year disaster restoration company with over 200 employees in 5 offices before selling his business to a national franchise. He is based in Novato, California and now works with business owners around the world to grow their results. In 2015, Kevin Waldron pioneered the Kilimanjaro project, a life leadership program that had him take a client to the top of Mt. Kilimanjaro in Africa.

 

Connect with Kevin:

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Transcript

Disclaimer: Transcripts may contain a few typos. With most episodes lasting 40 minutes, it can be difficult to catch some minor errors.

John Warrillow:

So what’s your biggest question when it comes to selling your company? When I ask that question of other entrepreneurs, I hear things like, “How do I avoid an earn-out? When’s the best time to sell? How do I create a bidding war?” These questions along with many others inspired me to write the book, The Art of Selling Your Business. It’s a field guide for punching above your weight when it comes to selling your business. I’ve taken all the best practices from the 300 plus interviews I’ve done for this show and distilled them down into an action plan for you. You can get it along with some gifts for my listeners when you go to BuiltToSell.com/selling.

There’s a big difference between wanting to sell your company and building a company you could sell. My next guest, Kevin Waldron did the latter. He started Olympia Restoration, built it up to $24 million in annual sales, and always knew that one day he would sell it. And so, as you’ll hear, even from the very earliest days, the initial inception of the company, he was thinking that one day he would sell his company. Here to tell you how he structured it is Kevin Waldron.

Kevin Waldron, welcome to Built to Sell radio.

Kevin Waldron:

Hey, nice to be here, John. Thanks for having me.

John Warrillow:

So when the worst happens to people, they get a flood inside their house and their couch is floating in six inches of water, you at Olympia came in and saved the day. Tell us about this company, Olympia Restoration. Am I getting it right?

Kevin Waldron:

Yeah, that’s right. Name of the company was Olympia. Yeah, I was your guy. So when everything had the fun and then things got flooded or damaged by fire, we were the guys that would come in and do all the emergency services, get everything tracked up and then do all the remodel to put it back together.

John Warrillow:

And so how did you win customers? I’m thinking this is not a recurring revenue model. You only have a flood hopefully once. It’s a terrible moment in your life. How did customers find you?

Kevin Waldron:

It was an interesting mix. There was a lot of people of the distinction between customers and clients. For us, we had a dual distinction, so we had customer as a distinction, and then we had client as a distinction. You’re correct. YOu only have a flood probably one time in your life. So our clients were insurance agencies, your insurance agent, insurance adjusters, property managers, hotels, facility managers, the kind of people that would bump into that type of stuff with some regularity.

John Warrillow:

Interesting. And so those were effectively your referral sources?

Kevin Waldron:

That’s who we marketed to. Yeah.

John Warrillow:

Interesting. Again, I don’t ask this in accusatory way. Is it legal to pay a spiff or commission to them or do they have to keep that separate? Are you going to pay any kind of commissions?

Kevin Waldron:

Yeah. And it’s a great question. There’s some shady companies out there that do that. You absolutely cannot do that. And we had made the decision very early on that we weren’t going to play that game, that we were going to get business just strictly on the value of the work that we provided, the result that we delivered. And we did a bunch of marketing stuff. We took people to ball games and dinners and horse racing events and stuff like that, taking people on fishing trips. All the stuff that you would do to grow your business, but a hundred percent, no one paid anybody commissions.

John Warrillow:

Interesting. And so what would your value proposition to an insurance agency be? I’m thinking these massive conglomerates and I’m assuming they just buy a price.

Kevin Waldron:

It’s interesting because I sold this company in 2005 and I started it in 1988. And for probably the first 10 years, it really was, people just wanted good service. They just wanted you to take care of their customers. I’m an insurance agent, for example. One of my customers calls and says, “Hey, I got a flood.” You go, “Hey, you need to call Kevin’s company. They’ll come right there. They’ll take good care of you.” And the value proposition for that insurance agent was we’ll come in and we’ll take care of your customer when they really need you. We all pay insurance every month and most of us kind of halfway resentfully so because we end up never using it. But when we do need it, that’s when we get that little kind of pang of like, “All right, I’ve been paying you for the last 10 years. It’s time for you to take care of me and make sure I’m handled.”

So that was a value proposition for the agents then. We were one of the largest independents in the country when I sold, but we didn’t try and negotiate monolithic contracts with giant insurance companies. It was all individuals and site organizations. So it really was a personal one-to-one selling experience.

John Warrillow:

You mentioned that changed though, Kevin. What changed? In the beginning, that was the approach, but you said for the first nine years. So what changed?

Kevin Waldron:

Great question. The biggest thing that changed was the healthcare model that existed in insurance, which has been in America for the longest time where basically they just beat the crap out you on price. The doctors can’t make any money anymore. That type of thing. That never existed in the property and casualty world for the longest time. That was the last domino to fall in the insurance world. So then they started putting a bunch of pricing together in databases and all of a sudden it became… “We used to pay you $50 for this thing. We’re now going to pay you $26.74 for this thing.” “Where did you come up with that?” “Our survey says that there’s $26.74.” which was total BS. It was just made up. But that was the sea change. That was the beginning of the sea change because they took on the healthcare model.

John Warrillow:

Interesting. And so what happened next? I would imagine your gross margins got pinched.

Kevin Waldron:

Gross margins got pinched. We had to work away around that, which we kind of did. The biggest effect it had actually was on net margins because at the beginning of that decade… You’re familiar with insurance adjuster, right? So that’s the person that comes out and looks at the loss and tells the customer how much the claim is going to be and how much they’re going to pay. Up until that sea change started, we were left alone just to do our work. But when that sea change happened, the insurance companies now expected us to do a lot of the work that the adjusters did. So the taking of the photographs, videoing losses and writing reports, all kind of stupid stuff that we had to do that we didn’t really get reimbursed for. So actually our net margins started to go down and we had to make some adjustments to that.

John Warrillow:

Got it. And so give me a sense of what a decent year would’ve been on a net margin basis, as a percentage basis on a good year pre-this and then what impact did it have after this healthcare model became the prevailing way.

Kevin Waldron:

Yeah. Good question. On a good year when I was doing about 10 million a year and I was strictly… Again, product is so key because there was three pieces to the business. There was the water damaged stuff when buildings get flooded. So that’s when you go in and you put all kinds of drying equipment in. So it’s a rental business is what it is. You get a guy that comes in and he’ll tear up the carpet and tear the drywall. But then you’re putting in very expensive drying equipment and you’re charging by the day for that. So you might take something like a dehumidifier that takes moisture out of there. That would rent anywhere from a 100 to 200 bucks a day. We would buy the best equipment, service the crap out of it so that it was always in good working order. And the margins in that were through the roof. So when 10 million in sales or net margins, pretax were probably like 24, 25%.

And then after that, probably on the water damage, went down to like 16%. And on the construction side, which ended up becoming the bigger of the… My biggest year was 24 million in sales. I know out of 24 million that year, I probably did about 12 million in construction. And that was only done at a 7% net margin.

John Warrillow:

Got it. That’s helpful for sure. So you mentioned you had three products, water damage, construction. What was the third?

Kevin Waldron:

The third one was what we call contents. So that would be if you had a fire in your home, the fire doesn’t burn the whole home down, it just burns one room, for example, but the smoke goes through the whole house. So you have to pack up the contents of that house, put it in a moving van and then take it back to our facility where it was all cleaned and processed. And then it was stored there until we could go in and do all the remodel, put new carpets in, do the paint and then you would move everything back in. So in some respects, that was like a cleaning company and a moving company.

John Warrillow:

So it really was three almost unique companies in one.

Kevin Waldron:

Inside one company, exactly. Three different disciplines, three different sets of margins, three different sets of skill sets and operations and the kind of people we had to hire, all very different.

John Warrillow:

Yeah. I’d imagine. I think a lot of people listening to this would be familiar with restoration companies that come in and deal with a situation where there’s been a fire or flood or whatever. And most of them are a guy or a girl in a van. Very small businesses, owner operated. You call the guy’s cell phone and he shows up with some fans and some elbow grease and gets the job done. You’ve cross the chasm, to use Jeffrey Moore term, from a guy or girl in a van to a $24 million business. And I’d love to know how you got from just doing the work to running a company. Could you distill it down to one decision or one action you took that got you out of that, just doing the work into running a company?

Kevin Waldron:

Yeah. It was interesting. So just a tiny back story. I think two months before I started my company. So I worked for somebody else. I learned how to do everything. And the guy that I worked for was a complete jerk, treated his employees horribly, didn’t pay his taxes, all kinds of shenanigans. So I had what Michael Gerber would call an entrepreneurial seizure where you have that thing where you go, “All right, I could do better than that. America’s a great place. Seems to me if I look around, all you have do is kind of show up and you’ll beat 99% of the people by just by showing up.” So I decided to take the chance to start. And I think. Two months before I started, I went to like a half day seminar. And Michael Gerber was there and he talked about if you have to be there every day to open the door in the morning and shut the door at night, then you don’t have a business, you have a job.

And that scared the shit out of me because I did not want a job. I actually wanted a business. And I was willing to work hard. That wasn’t an issue. And at the very beginning too, it was me and one other guy, that was that. The very first person we hired was, back in the day, you call it a secretary. We had somebody just to answer the telephone. And I paid them a fortune at the time just because I wanted to be a professional company right from the start. I didn’t want it to go to an answering machine. I didn’t want to go to voicemail. It had to be a live person that would take the calls. So I think right from the jump, I was pretty clear that I wanted to build something and not just be a guy in a truck.

John Warrillow:

What else did you do beyond hiring someone to answer the phones in the early days to make sure you didn’t get sucked into doing the work?

Kevin Waldron:

Yeah. The early days. Obviously I had to do the work in the beginning. I was doing everything. Running jobs, doing the bookkeeping, cleaning the windows, taking the trash out at night. But hiring those first, it wasn’t until we got to five people, I think, where we really became a company. Because even when I had a couple of people, hired a couple of technicians, even at two people, if one of them quits, the other one kind of looks at you and thinks, “All right, he quit so you totally rely on me now so you really don’t own this company. I own you.” So once I got to five, which was two technicians and then a supervisor, then the next person I was able to hire was a marketing person. And that’s where we began to develop our whole marketing program.

John Warrillow:

A lot of people listening to this saying, “Well, that’s great, Kevin. I would love to hire a team of five, but I can’t afford it. I’m lucky to have one person. I can’t hire five.”

Kevin Waldron:

For me, you had to do it strategically. I don’t know where I was. I think right when I started, I heard the story of how he had built Starbucks. And he told the story of how Starbucks didn’t make any money for the first 10 years or whatever. And I thought, “Christ, I don’t have the luxury of doing that. I got rent to pay on Friday. We need to make sure we make money right from the jump.” which is what we did. And then in Scotland, there’s a really cool thing. When we were growing up, we had what’s called Christmas clubs, which is when you can’t afford to buy Christmas presents because you’re poor. But every month, it’s almost like layaway. You take a certain percentage of your pay and you give it back to the guy and he holds it for you and then in December you can afford to buy Christmas presents. We did the same thing for growing the company.

So as we made money, let’s say we brought in $10,000 from a job, we would set $1,000 aside to buy new equipment. And then we’d set $1,000 aside to be able to contribute to the next new salary. So we didn’t take the money out of the business for the first couple of years because we didn’t need it. We were young too. We didn’t need to spend a lot of money. But you just kept reinvesting it to get it to certain size.

John Warrillow:

Who’s the we?

Kevin Waldron:

My wife, Jeanine, the smart one. People tell you don’t work with your wife. Absolutely not. If she was the balance to… I was like the blue sky. I was the worker, but I was also the blue sky guy. She was the one that kept our feet on the ground. The one that said, “Yeah, we made $10,000 this week.” or whatever. And she’d go, “Great. Well where is it?” “Oh yeah. I better go and collect it, get it in the bank.”

John Warrillow:

That’s really interesting. How long did you work with your wife?

Kevin Waldron:

Until my kids were born, so probably she started working with me right when we started the company. We probably worked together for about five years full time.

John Warrillow:

What advice would you have for someone thinking about going to business with their spouse?

Kevin Waldron:

Know yourself and know your spouse very well before you do it. And as much as you can, leave stuff at the office so when you’re working, you’re working, but when you’re home, you’re home.

John Warrillow:

Good advice. Let’s switch gears to the final chapter. I think the healthcare model had infiltrated the insurance adjusting space and margins were shrunk. You reached 24 million in sales. What triggered you to want to sell?

Kevin Waldron:

Candidly, at that point I was done. I’d been doing it for 17 years and I was getting tired of getting beat up by the insurance companies. And I was literally ready to go do something different. I was done.

John Warrillow:

What was the straw that broke the camel’s back? I think a lot of people listening will say, “Yeah. I have those days where I’m just done. I want out.” But you wake up in the morning and you’re back at it. There’s usually though a straw that breaks the camel’s back. Some sort of triggering event that made it from theoretical to real.

Kevin Waldron:

Yeah. I started my company when I was 26. I sold it when I was 42. I think I just realized that the industry itself wasn’t going to change, the way the insurance companies had become and how tough it was getting and how everybody was beating you up over margins. Just tired of playing that game and didn’t think it was ever going to change. And again, people say, what is it when politicians get fired? They say, “I’m retiring to spend more time with my family.” It’s usually bullshit. But in my case, it was. I wanted to go do something different. I was done.

John Warrillow:

How old were your kids at the time?

Kevin Waldron:

I was 42. My kids were probably like 10 and 12, somewhere in there. And by the way, as I built my business, I was fanatical about no matter how much I worked, and I worked a lot, you can count on one hand the amount of practice or games I’m just watching. My kids play sports so I got to do both.

John Warrillow:

That’s the real luxury of being an entrepreneur. You don’t have to report to a boss that says you can’t leave at 3:00.

Kevin Waldron:

If you set it up that way. Yeah.

John Warrillow:

Yeah. Well said.

Kevin Waldron:

And you want to talk about-

John Warrillow:

Go ahead.

Kevin Waldron:

Sorry. Go on. No, I was just going to say last chapter is when the straw did break the camel’s back and I was like, “I’m done.” I think I would’ve been screwed if I would’ve woke up and went, “All right, I’m done. I need to know or think about selling this company.” But the relationships that I’d built up through the years, I knew when I was ready to sell, I knew who I was going to sell it to.

John Warrillow:

What do you mean?

Kevin Waldron:

When I was building my… I was just thinking about our call coming up this morning and I thought, “All right, how did I grow Olympia?” And I had an absolute blast for probably the first 14 years of running my company. Absolutely loved it. Loved getting up in the morning, loved the people I worked with. I loved the job that we did, the results that we produced. But every single morning, I would wake up and I would think, this one question informed me. And the question was, if somebody was going to pay me a boatload of money to buy this company, what would it have to look like? And bear in mind, never with the intention of selling. Never wanted to sell, having a great time. But that’s what made me build up the management team. That’s what’s had me deal with the market and be institutionalized. And I had a company approach me when I was probably down about 10, 12 million a year. Actually that’s a lie, probably six to eight million a year and wanted to buy-

John Warrillow:

Sorry, Kevin. Maybe it was the connection. You said six to eight million?

Kevin Waldron:

Yeah. Sorry. I’m Scottish so I can’t pronounce normal six.

John Warrillow:

No, it’s fine.

Kevin Waldron:

It’s not an X-rated short, sorry guys.

John Warrillow:

Six to eight million and you had someone approach you.

Kevin Waldron:

So six to eight million, someone approached me and said, “We’d like to buy you, blah, blah, blah.” And at the time I was working with my business coach and I said, “I don’t want to talk to these people. I don’t want to sell.” And she said, “Go through it for the exercise. So even though you don’t want to sell, go through the process, see what they have to offer, see what the structure is like. You’ll learn something.” And that’s what I did. I spent two months. And I was really upfront with them, I told them, “I don’t have any intention of selling, but I’ll listen to what you’ve got and I’ll hear what your program is.” And went through the whole process, super-fascinating. And then at the end of it, I said, “Yep. I told you I wasn’t going to sell and I appreciate your offer and I’m still not going to sell.” But kept on good terms with them. And they ended up being the company that I sold to probably five or six years later.

John Warrillow:

Interesting. At the time, what was their offer? Can you share kind of multiple range structure? Was it sort of, “We’re going to buy a chunk of the business and then have you run it for a few years.” or an earn-out? what sort of structure did they propose?

Kevin Waldron:

Yeah, no, they wanted to buy the whole thing and they wanted to give me, I think it was like 75% upfront with a 25% earn-out over two year years. So they wanted me to stay on for two years. The multiple at the time, if I remember right, was probably about four times EBITDA.

John Warrillow:

And what was your reaction to that offer?

Kevin Waldron:

Took it back to my coach, looked at that. And it was kind of fascinating. I was like, “Wow. Okay. That’s pretty good.” Because I think at the time it would probably have been about seven million net with more on the earn-out. But I looked at it and I went, “I’m having too good a time running it. And I actually think I can create more value by myself.” There was more to go for me at the moment.

John Warrillow:

So that company was kind of in the back of your mind as you grew. In what way did you keep in touch with them, sort of kindle that fire, so to speak. Did you try to keep them abreast of your progress along the way?

Kevin Waldron:

No. Candidly just being a human being. I’d like to see you. We would see each other at events or whatever, or talk once on the phone or whatever. We just kept a good relationship.

John Warrillow:

So when you got to this point of burnout, just wanted to go do something else, you’d been in it for 17 years, what did you actually do? Did you market the business to more than one company? Did you go directly to that CEO and say, “Okay, now’s the time?”

Kevin Waldron:

No, I went directly to them. In hindsight, probably, I could probably have got more money if I’d been a lot more strategic about it, but it seemed like a good fit. They were good people. They were a family-owned company. They had that big franchise, but it was still family-owned and operated. So it wasn’t like a big, giant corporate buying us. So they were good people to deal with.

John Warrillow:

There’s a lot of water under the bridge now. Time has gone by. And I acknowledged the fact that the company you chose, you knew, you respected them. And at the same time, you’ve also acknowledged that had you shopped the deal, you may have gotten more. If you actually got to rewind the clock and go back to that point in time, would you shop it or do you think you made the right decision in not shopping it?

Kevin Waldron:

No. And for your listeners, here’s the unvarnished truth. You don’t want a guy on this program telling you a bunch of theory or whatever or dressing it up. No, absolutely. That was a mistake. I probably should have shopped. So in other words if I had to rewind, absolutely, I would’ve shopped.

John Warrillow:

Interesting. Okay. So you go to the ultimate buyer and what was that conversation like? What was the approach that you took to initiating that conversation?

Kevin Waldron:

Ridiculously simple. Do you still want to buy me? I’d be interested in hearing what you’ve got to say now. And the whole deal was done and we went back and forth and negotiated for probably a week, 10 days. And then we closed within about 45 days.

John Warrillow:

Was the multiple sort of similar to what they were offering the first go around?

Kevin Waldron:

Yeah, I would say fairly similar.

John Warrillow:

Fairly similar in that space. And what about the deal terms? You mentioned the first offer was sort of to your earn-out 75% upfront, similar structure?

Kevin Waldron:

Similar structure. The only deference was I did not want to stay on for any time after that. So I let them buy the business. They obviously took all the employees and they folded my company into theirs, so they rebranded almost immediately. I think you probably saw the press release from back then. They sent a big press release saying that they’ve acquired Olympias.

John Warrillow:

Yeah. I did see the press release for sure.

Kevin Waldron:

And then within a year, they folded all our vans into their branding, because that was the space that they really wanted to be and for a long time. And rather than try and grow by themselves, that’s why they wanted to buy a company that was already established.

John Warrillow:

What was it like to see your brand go away?

Kevin Waldron:

I don’t know. Mixed emotions about that. I’ll tell you one of the funnest things. In the bay area, we had five offices. And it was kind of fun. I’d be driving down the freeway on my way to an appointment or whatever, and I’d drive by one of my trucks. And it was the coolest feeling to just look and see one of your trucks driving down the road. There was a guy driving it. He has no idea he’s beside you. You’re beside them. So yeah, mixed emotions. And then happy to let it go and move on to something else because I really was complete for that business. But yeah, it was something beautiful that we built and I’m a little sad to see it go away sometimes.

John Warrillow:

Yeah. I’ve heard that that can be, for some people, difficult, especially if the family surname is in the company name.

Kevin Waldron:

Yeah. Mine wasn’t, thankfully.

John Warrillow:

Yeah. Was that an intentional choice on your part?

Kevin Waldron:

That was a completely intentional choice. Again, right from the jump, if this is going to be a business that somebody’s eventually going to buy one day, they didn’t want it to be Waldron restoration. It ought to be something else.

John Warrillow:

That’s such a unique perspective because for a lot of people, they think it’s wrong-headed to build a business to sell. I’ve wrote a book called Built to Sell so probably I don’t think that. But I do get from time to time, people kind of criticizing me saying that’s a terrible way to grow a business. That’s a money hungry scenario. You should be building it to last. You should be building your legacy. Clearly I don’t agree with that, but I’d be curious to know from your perspective. What’s the question I’m asking? What was it that made you want to build to sell from the very beginning?

Kevin Waldron:

Again, the distinction is I didn’t want to build it to sell. I just knew that it would be useful to build it as if I was going to sell it. That was the distinction for me, because I thought it would actually build a better company and create more value for me. I tried to be a performance-based company right from the start. And to your thing about… That’s a really interesting distinction you said about you’ve been criticized for. Is it money hungry to build a business just a sell? Well, I think as long as you’re providing value, who gives crap? It’s America, you can do whatever you want. And if you’re going to build something that wasn’t there and it’s going to provide value to your investors or to the community or your customers or you’re going to give 200 people a job to come to every week and be able to put food on their table, what the hell’s wrong with that?

John Warrillow:

Nothing in my view.

Kevin Waldron:

Exactly.

John Warrillow:

Again, I’m going to ask you to think and sort of put your history goggles on for a second and think back. So fairly early in the company’s tenure, you got an attractive offer. You said your margins were much better in the early days. And then years later, though the revenue had grown, the margins had gotten compressed. Have you ever wondered, “Should I have taken the first offer?” when you were at six to eight and avoided the mental turmoil of having to be ground down by the… You know what I’m asking?

Kevin Waldron:

I know what you’re asking and it’s kind of a ridiculous question because you can’t go back and-

John Warrillow:

Thanks. I’m really good at those.

Kevin Waldron:

You’re welcome. I get what you’re saying. It’s like If I could have, would have. Well, I didn’t. Here we are. If I thought about it too long, I would drive myself crazy. I would be like a dog with a bone and I’d be somehow a miserable guy being resentful for like, “Yeah, I could have been a contender.” My life is beautiful right now. Everything worked out perfectly. It always does.

John Warrillow:

Yeah. And I get that sense for sure. The reason I asked the question was more for the benefit of the listener because I think a lot of listeners given how frothy the M&A market is right now, are getting offers way before they think they’re ready to sell. They’re getting unsolicited… People are coming up to them saying, and oftentimes offering really solid packages. And they’re like, “Well, I was thinking of selling years into the future, but maybe I should.” And so that’s where that question was just more to serve them than…

Kevin Waldron:

That’s a great question from that angle. I would say better a bird in the hand than two in the bush. So if you get an attractive offer right now… It’s kind of like a Vegas thing. You’re winning. Things are going good. Those cocktails flying around. You’re making money at the table. But if you stay too long, you could lose it all too. So if it’s going good and somebody throws a pile of money at you, definitely consider it. Don’t be too set in your… You’d have to have a certain timeframe. I have to run this business for 10 years before I can sell it. And that’s the work that I do with clients now in terms of the entrepreneurs that I coach. What do you really want? Because it’s a big fulfillment too. you talked about having a job. Sometimes as an entrepreneur, we can treat it like a job. You signed up for 25 years to do this thing. Or maybe you don’t need to be there 25 years. Maybe if somebody throws a bunch of money at you, you can exit and go do something else.

John Warrillow:

Yeah. I’m glad you raised throwing a bunch of money at you because I’ve just written down your age and the stage of life that your kids were in. What was it like to all of a sudden be liquid at 42? That’s a pretty young age. We don’t need to know the number, but there were some significant numbers at play here. And I’m imagining it. I could have been relatively… I won’t put words in your mouth. What was it like to be 42 and liquid?

Kevin Waldron:

The easy word would be interesting. What was it like? Disconcerting, discombobulated a little bit. Because it’s like, “Wow, this is kind of weird.” I thought who I am and my identity was as a swashbuckling entrepreneur and you’re going in and you’re moving and shaking every day and you’re making stuff happen. There’s all kinds of deals going on. And then all of a sudden you exit and you’re like, “Oh, there’s kind of quiet here. This is interesting.” And I spent about 18 months. Thankfully I didn’t try and play golf full time, but I did some things for about 18 months. I did some real estate development, stuff like that, where you made a bunch of money, you lost a bunch of money and everything in between. But it was boring.

So that’s one side of it. The other side was, it was kind of nice to know there’s money in the bank now, we don’t have to stress. So the pressure was off. But then it had to be about replacing it with some other sense of purpose sooner rather than later. And I probably jumped… Yeah.

John Warrillow:

No, go ahead.

Kevin Waldron:

No, I was going to say I probably jumped in a couple of things too early after that, more like kind of angel investing stuff that didn’t really work out. And while the market was good, I just jumped in too early. This thing about I’m an entrepreneur. I’ll make things happen. This is just how I am. And in hindsight, I would probably have taken a little bit longer to just look around and see what I was really interested in versus what seemed like a good idea.

John Warrillow:

Reminds me of a tweet I saw recently. I can’t give attribution because I can’t remember who it was from, but the tweet was what’s the best way to make a million dollars as an angel investor? And the punchline was, well, start with 10 million.

Kevin Waldron:

Start with 10. Exactly.

John Warrillow:

Basically the gist of it.

Kevin Waldron:

Yeah. It’s a common refrain for sure. Especially when you’re young to get that kind of money, you feel like you got a lot of runway left to go.

Yeah. Lots to do. Well, here’s a deal, I sold that one when I was 42 and I’m 57 now. And I’m literally just as excited if not more about the future going forward and I’m fucking awesome 15 years removed from that.

John Warrillow:

That’s wild. It sounds like your wife was a huge part of the business in the very first five years. What was it like in the final chapter when you’re negotiating back and forth with the ultimate acquirer, what were the dinner table conversations like with your wife at that time?

Kevin Waldron:

Boy, what a good question. Jeanine, ultimately, every single time I would bring back and I’d go, “Okay. They said this. What about this? This is what the offer is.” She would literally just look at me and go, “I don’t care. Whatever you want to make you happy.” And because at that point we had money in the bank anyway. So it was nice to have gotten our job done to that, “Whatever’s going to make you happy and whatever’s going to make you fulfilled. Let’s do that. So keep it, sell it, I don’t care.” And it wasn’t she didn’t care because she was disinterested. It was literally like, “What’s going to make you happy? What’s going to make you fulfilled?”

John Warrillow:

That’s incredible.

Kevin Waldron:

Yeah. She’s an incredible woman. I’m happy to be still married to her.

John Warrillow:

That’s great. I think we’d all takes some life lessons from you as well as some business lessons. Tell us where people can find you, what you’re up to. Is there a website people can go to? Just give us a sense of…

Kevin Waldron:

Yeah. Super easy. It’s waldronleadership.com. I’m in Northern California. Really easy to find. I’m right on the web. Don’t do it on social media, but go to the website. You’ll find me.

John Warrillow:

Waldron Leadership, we’ll put that in the show notes of Built to Sell radio. Kevin, this was a real treat for me. Thanks for doing it.

Kevin Waldron:

Yeah, likewise. I appreciate it. Thanks John.

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 of 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’ve 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 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% percent, 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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