Episode Transcript
[00:00:00] Speaker A: Welcome to Create Wealth Through Franchising. I'm your host, Kim Daly.
Whether you're a CEO, a military vet, a real estate investor, or simply in career transition and ready to take ownership of your future, with each episode, you're going to learn valuable insights and hear inspiring stories from within the franchise industry.
On that note, my guest stories are their own. And as a franchise consultant, I do not make personal brand endorsements or earnings claims, but I do educate, motivate, and inspire dreams.
Now onto the show.
Welcome back to Create Wealth Through Franchising podcast and Kim Daly tv. I am your host, Kim Daly, and in my studio today, a new friend, but a very special friend. His name is Todd Eppert. He is a franchisee of Focal Point Coaching. So we're going to accomplish two goals today. He's going to talk to us a little bit about what's happening in his life when he decided to invest in a franchise and he chose Focal Point Coaching. But then more importantly, we're going to talk about the specialty that he has in his coaching practice, which is helping business owners build for higher valuations by going from being the rainmaker to being the architect, or in Kim Daly words, working on your business rather than in your business. So with that introduction, Todd, welcome to the studio of Kim Daly tv.
[00:01:32] Speaker B: Well, thanks, Kim. I'm really happy to be joining you today and honored. Thanks for having me today.
[00:01:36] Speaker A: All the way from Cincinnati, Ohio.
[00:01:39] Speaker B: That's right. That's right.
[00:01:41] Speaker A: I love it. Okay, so, Todd, I have two different kinds of followers. I have people that are sitting on the sideline trying to dare to get the courage to invest in that business that they're really dreaming about. But I've also been a franchise consultant for over 20 years and I've created nearly 1,000 small business owners in the United States. So they also follow me. So the people on the sideline, though, I think your transition story speaks to them and then your coaching speaks to the other half. So I love that we can kill two birds with one stone with one interview. So tell us a little bit, like what was happening in your life when you were like, you know what, I need to do something different. And how did you pick Focal Point Coaching?
[00:02:21] Speaker B: Yeah, great question, Kim. So I'm an engineer and I have an MBA by degree. And so my goal in life was to be a coo, a chief operating officer in a business. And I achieved that goal at about 40. I was working 70, 80 hour weeks. But I really loved my job and thought it was the right thing to do. And I don't want to get the wrong impression, but I had to start doing things as the COO that weren't great for me. So I grew up in an hourly household. My dad was a tool and die maker, my mom was a secretary. And I remember the days of the 80s when my dad would come home and say I lost my job. I got my proverbial pink slip and it was real. Back then that meant we, instead of going maybe to Disney or something or Florida for vacation, it meant we were going camping by the side of the Little Miami river, which is next to Cincinnati, right? So I remember those days. I remember meals changing and not going out for dinner. And as a coo, my job pretty much became primarily closing plants, integrating resources, terminated hundreds of people in my time, unfortunately, just because we didn't need their work anymore. And it really became soul crushing for me. And at about 45, I looked at myself in the mirror and said, I just can't do this anymore. I can't do this for the next 20 years especially. So I left the corporate world without a plan. I thought I was going to get about a two year window and it turned into six months. And then I was like, oh, what just happened? I had a wife that was a stay at home mom, and I had two kids in private school. But again, and this is maybe towards those people sitting on the sidelines, boy, your spouse can either be a cheerleader or a detractor. My wife was a significant cheerleader and she just knew I was so unhappy and she said, go do something different. So how do you recreate a really good income yet? Start over from the C suite. And I looked at franchising, I looked at a buying businesses period. And when I looked at buying other people's businesses, I felt like I was paying for things that didn't make sense. Like maybe one customer in the business and if that guy left, I was in trouble. Or maybe the business owner did everything. And I was concerned about that because I wasn't sure I could do that. I looked at one business as an example where I had to be the designer of the product as well as the deliverer and the salesperson. I didn't know how to design his product. I'm like, I can't do this business right? So anyways, there were lots of things that I noticed as I was looking at buying businesses that I was like, those are troubled businesses, I don't want to buy them. So then I looked at franchising and I looked at several models and I landed on Focal Point for a couple of reasons. One was I love coaching. I've been a developer of people my entire career and I felt like if I had to do the job, boy, that's one that I would really enjoy doing. Then something else. I also liked the community, the support, the people around me. And the other thing that always resonates with me is I certainly was not the smartest person in the room and I could learn something from those people. So that's why I joined Focal Point. And that was back in early 2018.
[00:05:16] Speaker A: I think it's pretty fascinating that you are an engineer by degree. Right. And you have an mba, which I always say. Those are my greatest candidates, by the way, because you have enough logical mind. But then you have the business side of you to keep you out of that analysis paralysis. I'm sure you had to overcome yourself in a pretty big way to leave that job without a plan. That doesn't sound like an engineer to me.
[00:05:37] Speaker B: Yeah. Kim, I hate to tell you this, but when I got my first job out of college, it was where I co opted When I went to HR and took my assessments, they told me they hired me into the wrong role. I should be a salesperson. And I said, no, no, no, no. I want to be an engineer. I have a degree in engineering. So my detail, I am actually the person that jumps out of the plane and wonders if I forgot my parachute halfway down. It's my wife. We'd go back to the cheerleader conversation. That is the super cautious one. And so we're a good balance. But yeah, it was definitely stressful for the simple reason that I wanted to provide for my family. I didn't want this to be a burden. I didn't want to have to do some crazy things. And I was the sole means of income. And so there was a lot of stress. But it wasn't as much around lack of a plan. It was more around could I even do this job when I started, if that makes sense.
[00:06:25] Speaker A: And now how do you feel about that question?
[00:06:28] Speaker B: Well, I probably couldn't have done it alone. And I know what you do. And we talked about putting thousands of business owners in. That is the beauty, in my opinion, of any franchise organization, the right one that fits you, has the support that you need, has the people around you. Starting a business is hard and doing it on your own is harder. Doing it with somebody that's done it before you like a franchise really helps you having that cheerleader at home. My wife, huge support. And today, six and a half years in I've been blessed. I've been successful at what I do. I love my clients. I love what I do every single day. And I will never go back to the corporate world.
[00:07:01] Speaker A: I love it. I love people who are unemployable because of franchising. It's so amazing. My followers have heard me say this. So when I was about 40 years old, I remember waking up one day and saying to my dad, you know what? I think I just realized I'm completely unemployable. And he laughed so hard. He was like disgusted by the comment. He was like, kimberly, you have been unemployable since you were two years old.
Okay? So really great setup. I'm so happy that you found your way and I'm so happy that franchising was the way for you, that you had the courage to jump out of the airplane without the parachute and figure it out and you landed somewhere amazing and you've got this life that you're just so proud of and you never have to fire anybody ever again. You never have to go through all those things in corporate America that those soul crushing things that other people were making you do.
[00:07:53] Speaker B: Yes. In fact, Kim, I've been approached by many, many clients over my six and a half years who've talked about, I've got this difficult employee that needs to be coached. And my first question is, are they savable? Do they want to be coached? Because if they don't, I don't want to be part of it. That's not what I want to do. I don't want to coach somebody out of a business. I want to coach high performers that have a future. And so I draw the line at that. There are certainly people that are really good at trying to save the performer that's quote unquote, circling the drain. I am not good at that. I would rather not do that. And so, yeah, I've put some boundaries up in place, including not going to work, but also not working with folks. And I have to look at get fired.
[00:08:32] Speaker A: Okay, so in six and a half years you've built your practice and you kind of said at the beginning that you really kind of focus on building for that exit strategy moment, which again I love because I believe all businesses are built to be sold. And there's some intentionality that has to happen. You can't just wake up one day and go, I think I want to sell my business and think you're going to get maximum dollar for. Right, like this is intentional. We've had other focal point coaches on who also have talked about that exit strategy and building for that with intentional action, even from day one. So bring us into your practice and specifically this topic of really going from working in your business to being working on your business and why that's important, and take us kind of through the life cycle of that to that exit strategy moment.
[00:09:19] Speaker B: Sure. A hundred percent. This is probably a good time to drop my podcast name. So if anybody's interested in learning more about how to work on your business and not in it, there is a podcast called On It, Not In It. It's my podcast. It's my marketing trademark. I love that term. I heard it years ago and I couldn't believe it was available. But yeah, on it, not in it is something we use regularly in our world, of course. So what does that look like? So I go back to where I was looking at those small businesses. So when I was in the corporate world and we were making acquisitions, the reason I typically had to close a plant or consolidate was because we had one of the big problems that exist in small businesses. Oftentimes it was owner dependency, or it was like two customer centric, one customer or one supplier centric, or one employee centric. And so when something happened in the business, we could no longer afford to run that operation. We had to consolidate it, try to pick up the pieces as we went. I saw the same issue when I was looking at buying small businesses. Lots of owner dependency, lots of customer focus, lots of single employee focus. And those are all big detractors to the success of transitioning your business. And I want to make it really, really clear to business owners out there, regardless of what you want to do with your business, whether you want to sell it to somebody or give it to your kids or give it to your employees, you have to do the same work as the owner. You have to fix all the detracting things in the business so that it successfully transitions and you don't lose the legacy that you've built over the years that you've been building your business. That's the biggest thing about on it, not in it.
[00:10:51] Speaker A: Assuming, though, that when the transition happens, the new owners pick up the ball and run with it, right? I had a friend who built an amazing business, thought he sold it to the right people who had all the right intentions and understood and kept him on for a couple of years so he could really keep it. And when he was there, they kept it at that same level. But then as he stepped back, man, he just shares the heartbreaking stories because it's his legacy. Those are still his customers in his heart. And they're not getting the same experience that they had when he was the CEO of the company. So the new owner has to be responsible, Right? Like, because you package it perfectly, but I guess you don't have to care if you get your money and you run away.
[00:11:33] Speaker B: Yes. You know, when you build a business, it's a child. And I want to bring up this concept of the rainmaker. That's the owner dependency concept that I would like to talk a little bit about. So I've talked to a lot of businesses over the past couple of years. They'll come to me and let's say they're their solopreneur, meaning they are their only individual employee. Maybe they've got some contractors, but they're really the meat and potatoes of the business. They know all the customers by first name. They deliver all the services, they do all the content creation. They do everything in the business. They're really the rainmaker. What that means is they bring the rain, right? Everything that happens in that business is because of that owner. And when they come to me and they say, I really want to sell my business, what's it worth at that point in time? I often look at them and I say nothing. And they go, well, wait a second. I was playing golf with my buddy, and he got seven times ebitda. And I said, well, what kind of business is he in? It's a totally different business model. It's a different industry. He's got lots of employees. It's not interdependent. And I'm like, you're not comparing it to the right stuff. So think about it this way. And I don't want anybody to imagine their death. But just think about that. If you got hit by the bus today, what happens to your business tomorrow if you're not there? And if the answer is nothing, then the business isn't worth anything. There's nothing to move forward. Therefore, the business has no value to the next person in line. Now, you gave me the example of your buddy who sold his business, did well, stayed on, they did well for a couple years, and then when he left, it fell apart. So that's a really good example of he probably had in the industry called what's called an earnout attached to his deal, right? So he sold his business, he got a check at the table, and then the next owner realized that they needed that owner to stick around to transition the business successfully because the previous owner had not done the work before selling the business to be able to transition the business successfully. That means you get another check for the earn out. If you do your job and you maintain the business and it transitions while you get another check at the end of that time, the thing you have to ask yourself is, do you want to work for someone for the next two to three years while you're going to get that earn out? Most solopreneurs are unemployable. Most business owners don't want to work for somebody else. They've had tons of control for a decade, two decades, three decades, and suddenly someone above them, like me as a former coo, is telling them what to do. And that doesn't feel very good. Right? So that's another reason why you should be working on your business, not in it. So that's the rainmaker problem. And when you have that problem, things that you need to start thinking about is building a team, building processes that are repeatable in your business. Right. Handing off some of your responsibilities, which is really hard for the owner to do. But I don't know all my customers anymore. Yeah, that's a good thing because you've got a sales team and an operations team maybe that knows your customers. And so the next buyer sees the value in your sales and operations team, not in you, if that makes sense.
[00:14:26] Speaker A: Hey, Daily Coach fans, if you're ready to begin your own journey to find the perfect franchise, please email me right now at inquiremdaily tv. My services are totally free for you. That's inquireimdaily tv. Now back to the show.
Are you okay with an owner starting out and knowing all the customers to learn the business? Or do you actually prefer people come in working on it from day one.
[00:14:58] Speaker B: Now, as long as they have the ability and the desire to work on their business and more importantly, the timeframe to do it. So if you're a solopreneur and you want to eventually sell your business, you probably need to start working on it at least five to seven years in advance. And there's a reason for that. So for a couple of years, you're going to be building the systems. You're going to become the architect instead of the init, the rainmaker, you're going to be on it, the architect. You're going to be building things, hiring people, building systems, building processes, starting to build that business as an entity that can run without you being there. That's the architect side. Do that for a couple of years. Then you need to perform for three to four years so that your financials show the value that you've generated in those three years. And that's what most buyers want to see. They want to see your last three years of financials, and they want to see that you've got some good systems that work, some good people that work, and some good processes that work.
[00:15:54] Speaker A: You know what's most amazing about the whole thing is, I mean, this is all goal driven. It's acting with clear intention. Like these are the principles that drive success no matter what. Whether you want to be the rainmaker forever or you want to be the architect. Right? But it's just, it's all like focused attention to build what you really want to build. Because how many business owners just show up and build a business, but they don't have that clear vision of what they're building to or for? And then they come back and be like, I think I want to sell my business. And they end up taking a loss because it's not in the place that it should be to really, if they had built it with the intention of selling it from the beginning. I always tell people, if you build it, to sell it, and you get to that imaginary point in the future and you're having the time of your life, so you don't sell it, right? Like you haven't lost anything. But if you don't build it to sell it and then you get there because inevitably you will and you want to sell it now you're in a conundrum, maybe, you know, per your idea, another five or seven years to put it in the position to sell it.
[00:17:02] Speaker B: So, yeah, so it's really common that we do spend, you know, 5, 10, 15, 20 years building a business and we realize it's time to sell. But then if we haven't done the work, you might get something for your business, but I can promise you you won't get what it's truly could be valued at. Then you have to really come to the realization, is it worth the effort and the energy I have to put in to become the architect versus the rainmaker? There's some business models that are fairly easy to transition. I'll give you an example. Like let's say you're an insurance agent and you build up a book of business or a wealth manager, you build up a book of business. There's a lot of other insurance agents and wealth managers that would buy your book of business. They'll pay whatever the industry standard, one and a half times or two times your book value, whatever that is, which isn't bad. But if you build a team and you build an agency. You might get 10 times the revenue in your business or 7 times the revenue in your business because you've got a viable sellable entity that somebody else can take over and run and make the same kind of living you've been making. And that's really what the work of the architect is to do.
[00:18:03] Speaker A: It's amazing. So how soon should somebody find you, Todd, if they're building a business with the point to sell it?
[00:18:11] Speaker B: Well, again, five to seven years is what it takes. So they really need to be working on it. Five to seven years before that date of transition, people tell me, well, I'm going to give my business to my kids, and they're only 17 years old. Great. Okay. They're going to finish high school, they're going to go to college. What are they going to do afterwards? I don't know yet. Well, do you think it would be good that they have experience outside of your organization? Yeah. Okay, then. Now you're probably talking 10 years, right? So what are you going to do in the 10 years to make sure that when your kids come on board that you can stay with them and enjoy it or transition it to them? So you're talking a long period of time, and I can't answer that question. But the longer the better, let's say that.
[00:18:47] Speaker A: And so do you work with these clients, like, for the whole time, or is it like you put a plan in place and they go out there and they start hammering away and then they come back at certain checkpoints?
[00:19:00] Speaker B: Yeah, great question. So I typically work with my clients on a regular basis, like weekly or every other week. And we will often do the work together for one to three years, and they might take a short break, but I often have clients that stick with me even though. Because after those three years, they've realized, boy, this is really fun. I'm driving a lot more value. This has been worth it. I'll bet you. There's new things that come along that we need to continue to work on. Because again, if you double your business in three years because you're working on it, not in it, and you've hired good salespeople and good operations people, you probably have new challenges that you need to start work on because it's twice the size, you have more employees, different muscles, different questions. Exactly right. And generally the solopreneur go back to, let's say, an insurance agent or a wealth manager that's starting, and they're really good at building the book. But if they're building a team. They don't necessarily have that skill set and they might need help in a different area of the coaching side.
[00:19:55] Speaker A: I love it. You know what I love also is that there's so many people in franchising who may be listening to this, who believe that when they signed that franchise agreement, they got everything they needed to be successful. And the more interviews I put out there like this, it shows you that business coaching is different than what you're investing in when you pay a franchisor. They're two separate things. Right. Like I say, the strategy of running that business, which is probably 20% of your success formula and 80% is what Todd brings to the table. How you think, how you talk and how you act, that's what the daily coach brings to the table. Right. Because the intentionality, the focus, the clear goals, the why you're doing it so you're able to follow through, that's what determines success.
[00:20:46] Speaker B: Yeah, I would agree totally, Kim. And I can speak intelligently about working with franchisees that have been in other business models. I have a couple of clients that are franchisees and they would. That's exactly what they would say. They're great organizations, great brands, great everything. Great startup. I need a coach for the long term. Right. Not the startup. The startup is usually really well supported by the franchisors. Some franchisors do actually have business coaches as part of their team.
[00:21:10] Speaker A: You're an amazing guest. I'm so happy to have you here today. So if somebody wants to find you, we know your podcast is on it, not in it.
[00:21:18] Speaker B: Yep. And you can find it on all the major brands, Spotify or Apple podcasts or whatever you listen to. On it. Not init is the name again. You should find it under Todd Eppert. On it, not in it. And then my website is todeppert.focalpointcoaching.com so that's my name spelled out. Focal point Coaching.
[00:21:35] Speaker A: Thank you so much. Awesome. Well, we're going to put all of that in the show notes so that you can reach out to Todd. If you're inspired by him and you want to learn more how he can help you take your business to the next level. Go from being the rainmaker to the architect to selling for maximum dollar. Todd, thank you so much for being my special guest here today on Create wealth through Franchising podcast and Kim Daly tv.
[00:21:57] Speaker B: Thank you, Kim. I really appreciate it.
[00:21:59] Speaker A: It's been a pleasure to connect with you again. So for those who are on the sideline, who are inspired to begin your journey to first find the business that then we need coaching on. Well, you know that I want to be your franchise consultant and your daily coach. Please follow the link in the description below and I will reach out to you right away. And until next time, my name is Kim Daly and I want to be your daily coach.
You can find more content just like this on my YouTube channel at KimDaily TV. And if you're inspired to take the next step to explore franchises match to you, please email me right now at Inquire KimDaily TV that's Inquire at KimDaily TV.
