Episode Transcript
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(00:00):
Thank you so much fortuning in to the acquisition IQ podcast.
My name is Nathan Byrdand I'll be your host today.
Today we are joined with Chris Warren.
Chris is the co-founder of debt Dot help.
He helps businessesturn chaos into clarity
with deep expertise in strategic planning,data analytics and team optimization.
(00:21):
He builds high performing operationsby combining leadership systems,
smart sales teams, decisionmaking with also
an MBA in leadershipand a master's in Business Analytics.
Chris operates at the intersection ofrevenue growth and operational excellence,
making him the go to expert for founderslooking to scale.
(00:41):
Thank you so much for joiningthe acquisition IQ podcast today.
No, it's good to be here.
Good to see you again, Nathan.
Absolutely.
You know, it's always good toI obviously continue communications
with all of our founding membersas a part of the network,
but also just founders that are growingfounders that have grown, and founders
that are wanting to help others
(01:03):
throughout the problemsthat they typically will face in business.
So share with usa little bit more of your background
and what got you intowhere you're in today.
Yeah, no, not a problem.
So sales is my first love, right?
You know, I,
as a young, as a young professional,it was, right out of college meeting.
Didn't, didn't graduatethe first time around.
(01:23):
Had to go back and do that much later.
Got into sales, did a lot of time in sales at all levels,
started, you know, telemarketing businessdevelopment representative.
To closer to team leads to management,to founding my own company
and sales company.
You know, over the years,been in sales for financial services
for, home based construction services,
(01:45):
business to business serviceslike marketing and agency.
You know, recently back in 2022,
me and, longtime business associatedecided to get into the debt relief space.
So in March 2023, you know, I co-foundedand we launched that that help.
Back then, it was branded debt busters.
You know, and the theme was,your superheroes to get you free
(02:09):
from debt.
So March, March 1st, 2023 was meand my partner and one employee,
from a Craigslist ad in a 400 squarefoot office in Sacramento.
And, I think our initial investmentand operational budget
was blown in about three weeks.
And so it was, a journeythrough that first year of,
failing forward, going back,finding more financing, fixing cash flow
(02:32):
problems, building sales revenue,operation systems that would last,
getting corporate governanceand order and accounting in order
that we would go through M&A scrutiny and,
and build the type of companythat investors want to see and invest in.
So we were able to grow from there
and sort of leverage what my second loveis, which is data and systems.
(02:53):
You know, my wife got back the collegedegree, went got a graduate degree in MBA
and then gotten a graduate degree in dataanalytics and,
leverage that to just keep buildingsome great systems that were data driven.
And so my opinion could mattera little bit less.
I could get smallerso my team members could get bigger.
And, it turns out they really like it
when I intentionally make myself smallerso they can get bigger.
(03:16):
And, we were able to grow and grow and grow.
We were able to sell the companywithin 24 months of, of going into revenue
production.
So and I'm still todaythe co-founder and CEO of,
of thatto help into into an earn out period.
So I'll probably be with the firmfor years to come.
Let's talk a little bitabout how you prepped your company.
(03:36):
And, you know,sometimes people aren't as proactive
as as what you're saying as far aswhen you first entered into the business.
So that's a 24 months.
So you must have had already already knownwhere, in essence,
you wanted to go by the end ofor that growth.
I mean, you don'tobviously know everything, right?
But you've got to set up some parameters.
(03:57):
Well, if you're if you're an entrepreneurand you're founding a company,
ideally you
desire either an exit or majorcapital investment at some point. Yes.
And so both of those are going to requiregovernance and business processes
from the beginning, or at least very,very early in your company's genesis.
Because even if your position is whyI want to retain equity
(04:19):
and ownership and control,and I don't want to go through an exit
like sell to a traditional companyor P firm that might take it over.
Either way, your books have to be builtin a way that, you know, investment
bankers can get into and understandand speak a common language once,
and you can pass muster with.
So we started that early CE,and that's good because I've spoken
(04:40):
with a lot of business owners
and then also service providersthat are constantly saying
that business owners are behind the ballin the preparation of what their initial
or what their end resultthey desire to have.
So yeah, it's is an infusion.
It's not an exit, you know.
Yeah, it's a problem.
I meet people all the time who seek maybecounsel or help or business consulting.
(05:04):
Fundamentally,
the questions that are going to getasked, are almost
always going to be the same,and they're always going to revolve
accounting metricsand KPIs around profit and loss.
And you have to educate yourself, likeeven if your education's done,
you know, I highly recommend going backand getting at least certificate level
understanding of accounting, double entryaccounting methods, and QuickBooks,
(05:26):
and how to read your panels and balancesheets and really sort of digging in
deep there, even though that wasnever my first or second love.
I went got an associates in accountingbecause I knew
I had to speak the language.
I knew I had to incorporatelike fundamental best practices.
So when we sat down with accountantsand bookkeepers to organize books before
a company was even producing revenue ofof substance, I knew where we were going.
(05:48):
And so that's just that's fundamentallythe advice I learned in my 20s
was I used to build thingswith having no idea of where I was going,
and everything was trying to get pickedup, like after I'd already done something
and what's,
you know,everything's done on an Excel spreadsheet
and single entry and it doesn't workand no one wants to invest in it.
There's no governance,no one wants to buy it.
And so you definitelywant to get that dealt with upfront.
(06:11):
Isn't that interesting?
Because think about it.
As a founder, you spend so much timeat the start and the onset of the creation
of your companywith a bunch of ideas and vision
and zero clarity on
what what you are initially wantingto create, you know, for, for the world.
And it doesn't really discredityour energy that you put towards
(06:33):
a project.
It's just a matter of,you know, doing it the right way.
And I think that, you know, you're
living proof that you've done it reallya little bit of a better, better way.
But obviously it takes a lot of failureto be able to get to that point.
Absolutely.
I mean, in the last five years long,I've got three failed business projects,
you know, that I was either a co-founderon or consultant on, another business
(06:56):
that we were able to sort ofin a consultant role,
you know, take sales from,you know, 45, $50,000
a month in revenue to well over half$1 million a month in revenue.
And I while I failedto get that company through an exit,
you know, they're still around today.
They're still maintaining the revenuelevels that I was able to scale it to.
But, you know, three, three failedattempts, right?
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Starting businessesand all sorts of spaces, you know, and,
you know, one consultant role thatI was able to scale successfully and build
the business processes up for and reallyget the best practices around sales.
And my first love, because acquiring the customers
is that's to me,it's it's the majority of the show.
But we did fail to get that companyexited,
(07:38):
you know, and so I sort of transitionedto what was next.
And this was what was next.
This is good.
Well, I'm going to get intosome strategic questions here.
I will I want to make surethat we're providing some value.
Not so that we haven't already.
I just want to make surethat we're tactical.
So what do you believe most about,you know, high performing teams
and what what are some thingsthat you've experienced in your life
(08:01):
as far aswhat doesn't make a high performing team?
And what does
what makes a high performing team
is when the things that you're practicallyasking your team to do,
when you're doing them with them,
and everyone buys in and understandsthe asks and the mission,
and the mission sometimes can besomething that's unreachable, unreachable.
(08:22):
So I hope our vision is to build a debtfree America
of, like, just on the face of it,that's that's an impossible task, right?
You know, our government's, you know, $37trillion in debt or whatever,
and consumershold $1.4 trillion of credit card debt.
But that's an impossible vision.
But that's okay,because the team understands
(08:42):
the why behind itand why we're passionate about it.
And the value that we're providingis inflation continues to drive up
pain points for consumers and credit cardinterest
rates, you know, near 30% on average.
And then when when I'm operationallytelling people on a practical level here,
this is what we're asking you to dothis on a daily level.
This is what we're asking you to do thiswith this software piece.
This is why we're trying to do this.
(09:03):
It makes the leadership job longer
and more difficult,that they have more buy in.
And the second, to understand the whybecause you should you know, ideally
you're hiring competent, intelligentpeople who are hard working like yourself.
And so typically with intelligent,hardworking people, if you tell them the
why they're going to come with youand they'll do what
you're asking them to doas long as they see you doing it yourself.
(09:26):
And so the heartbeat of any companyI've ever been successful at,
whether it was as an employee,as a manager,
when I built, when I was trying
to do consultant scale for or this,this project that I'm currently a part of,
it has been driving customer acquisitionthrough a culture that empowers sales
professionalsto do excellent work in the field
of getting peopleto say yes to a value exchange and
(09:50):
that's sort ofbeen the driving heartbeat of any project
I've worked on,even on, digital physical goods sales.
Yes, you're right, it's similar.
So that's because there is, you know,there's copy, which is in essence
just going to be your digitalthere's the marketing piece
that's going to sparked one's interestin to what they should say yes or no to.
(10:11):
And then there's also the correspondencethat must be had.
As one, you know, has that interaction.
Can you explain deeper as to the sales,the sales training
that you've been able to implementthat then creates that excellence of,
of sales culture inside of a business?
(10:32):
I'd say that's just radical transparencyin a feedback loop, where first we enable
and sort of empower our team membersto lose all defensiveness.
And that starts with me.
And so, like my door is always open,I not only offer myself up for feedback,
but I actually beg them to,hey, if you see something I'm doing
just because you're, you know, maybea business development rep and I'm the CEO
(10:55):
and you have an idea or you see somethingthat we're doing wrong or something I'm
doing wrong, I actually invite thatfeedback immediately, and I want that.
And the second I see that,I can take that and heal and hear
that when I'm running a training session,I'm asking them the same thing.
Hey, don't be defensive before coaching.
You know, like if we're trying
if we're trying to get you to a placewhere you can be successful
(11:16):
and you can be financially free,and you can have relationships and build
rapport with all sorts of people, all egoand defensiveness sort of has to go away.
And we have to learn how to do things,because typically humans don't enter
into relationship and ships,business exchanges or value exchanges
with subject matter experts.
(11:36):
You know,they're not buying cars from engineers
who can understandhow the engines work, right?
They're not they're not buying housesfrom civil engineers who can talk to you
about, the weight load and the wind loadcapabilities of the roof.
Right.
People engage in interactions and valueexchanges with people that they trust,
that they can relate to,and with a value offering
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that they believe is fair or goodor beneficial to them or their family.
And so that's sort of the corethat's the stuff we put in the soup.
That's so good.
I mean, you're not buying a softwarefrom the technical founder who only codes.
No you're not.
And and typically ifif a founder is like a technical guru,
(12:18):
very rare is the individual
who is sort of like a technical geniusand really masterful at soft
skills and interpersonal relations.
I'm not saying they don't exist.
I'm just saying,you know, it's rare to find, hard to find.
Yeah.
And sort of having a diversityin your workforce
of talents and like,how how do you how do you get that,
(12:39):
that breadth of relatabilitywith your target audience?
And I'd say the second piece of the salesthat I really like to train on is
how do wehow do we sell our product to someone
who is only tangent, highly interestedin our product, or has low intent?
And can we find populations or,
avatarsthat maybe haven't opted in all the way?
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They're not high intent, but we knowthey're right next to our typical avatar.
And how do we
how do we train a sales professionalto take someone with mild, lukewarm
or cold interest
and get them
to pitch, presentand sell in an effective manner,
where people engage in the conversationand hear about it from our sales reps
and sort of, next to space.
(13:24):
And that'sthat's something we've always done well.
And I say we just the people I've workedwith over the years in a couple different
sales contexts is, hey,if we try to approach this thing head on,
we're going to have a lot of turbulence
from major enterprise playersin the same marketing spaces.
So how can we asymmetrically get as closeto the space
of the avatar as possible,and then learn how to sell really well,
(13:47):
let's, create a scenario right now.
Almost like a roleplay, around a scenariothat one would have objections.
I love to always do this
because, like, we we're in saleswhether we like it or not.
I personally love sales.
I love interacting with people,getting to know what their pain points are
and just getting to knowthe relationship really.
But let's create a scenario, right?
(14:09):
You just called me and you know,
you went through form family,occupation, recreation, money.
You're starting to find some pain points,but I've got a little pushback,
you know, as to what it isyou're you're providing.
This could be both product or service.
It doesn't have to bewhat you're currently providing.
What what's your next step? Like?
I'm literally like,
(14:29):
I'm not sure I need to go talk to myI know how going to go talk to my spouse.
I need to think about it.
Yeah.
So so the way I've always operatedas both, a sales professional,
sales trainer and manager.
And now how we run this company here is,
we don't provide,you know, written quotes.
And, the reason forthat is usually if you're telling me
(14:52):
that you need time to think about itor you need time to talk to your spouse,
that usuallyrepresents an underlying objection,
because human psychology is tough,and human psychology is telling you
to tell me that because in realityyou don't trust me
or believe in the product enough,but you don't want to hurt my feelings.
So you're just telling me you need to gothink about it and talk to your spouse?
And for my for for ourfor our sales team members.
(15:14):
The easiest thing for them to dois to give you a written quote,
because then it gets them out
of an uncomfortable conversationof confronting sort of what is thought
to be an implicit dishonestyin your request to get off the phone.
And and the reason I bring uphuman psychology is because we always will
tend to flee from discomfortand flee towards comfort.
And and I always am telling our team like,hey, the most
(15:37):
the most successful place that we can beis the place that is the least comfortable
this person is telling youthey want off the phone
because they need to think about it.
What they're telling you isthey maybe can't relate to you,
they don't trust you,and they're not sure of your value.
Offering one of these three.
But they're not going to tell you that.
They're not going to say,hey, Nathan, I don't trust you.
So I'm going to get off the phoneright now.
(15:57):
Like,you know, it's just not polite, right?
So they're saying a polite thing,you know?
I'll talk to you later about this. Okay?
So we try and come back.
Well, you know, sir, ma'am, in my lineof work, I've been doing this a long time.
Licensed professional.
Usually when I hear something like that,there is an underlying concern.
There is an underlying problem.
There's something that you might not like,understand about the product.
(16:19):
That's just been typically my experience.
I'd just like to ask,
is there anything that is making youhesitate
right now from taking these savingsthat are on the table for you
today might not be on the table tomorrow.
I don't know what'sgoing to happen tomorrow,
but I do know that right nowI'd be approved for this.
And it sounds likeyou have some more questions.
And I got all the time in the world,so why don't we just talk about them?
What's on your mind?
(16:39):
And I would always continueto try and keep that conversation going.
Especially when you're talkingabout direct to consumer,
not business to business.
That's a totally different approach.
And so but most of my professional careerhas been DTC direct to consumer.
If you're talking business to business,
if they need that,if they say they need to think about it,
(17:01):
you need some more probingquestions like,
what do you mean, doesit need to go to a board for review?
Does you know who who are the signer?
It's a whole different conversation.
But hopefully I answered your question.
Yeah. You frame it.
You know, since you kind of, you know,you can repeat back as to what they said.
And just to make sure that you understand,I would also, you know, maybe
you can even address it,knowing that those are
(17:23):
the three specific scenariosthat people typically will address.
You just say, hey, listen,you're not going to hurt my feelings.
You know? That's right.
I mean, because that's just one of the,you know, one of the oppositions
that you're going to come againstand then maybe, you know,
whatever else you just laid out,just simply just state it.
Right. Not to be uncomfortableI always tell.
(17:44):
So it's very comfortableto send out a call.
You got like a 5% chanceever talking to that person again.
Just be uncomfortable.
And and if they see you being vulnerable,they might trust you to get
a little bit more vulnerable and actuallytell you what's on their mind.
And then if they tell you
what's on your mind now, you have a chanceto deal with the real objection.
Well, we find that, obviously in sales,like nobody wants to be.
(18:08):
Nobody really wants to be sold.
No, right off the bat.But they love to buy.
We love them.
Yes, they do, you know,and it's really just important for us
to, to understand that, you know,as one who's either running a business or,
like you say, it'sspeaking to people because,
you know, even in your position,you're the CEO, you have a team,
(18:31):
but you're always talking about peopleyou know,
or about the offeringthat you have in an in, in essence,
a sales scenariothat could quickly turn into, hi,
I actually have a solution to your problemand this is what we can do.
So I think it's, you know, importantto have that understanding.
Gosh. Yeah.
(18:52):
So that so in essenceyou've got a company and, and,
and every form of salesis within the company.
But I'd ask specifically how
how you've been able to
radically transform the current,you know, kind of your current company
and some of the thingsthat you implemented from, from leadership
(19:13):
to team and then to execution.
How did you go from, you know, the garage
to building out the sales team?
And you know what I mean?
Yeah, that processlike so it was very different than it was,
you know, maybe in 2005 or 2008, you know,I'm dating myself a little bit now, but,
you know,
you were talking about somethingthat many people today would call revenue
(19:36):
operations, right?
They'd start talking about rev upsand automation of sales processes
and this is where, you know, I
you I left college the first time and,you know, in my late teens and early
20s and I had to go backand do it later. I did late 20s and 30s.
And I
never understood thethe breadth of the learning that I missed.
(19:57):
And so, you know, getting graduate degreesin business processes, data analytics,
coming back to building teams,
I was much more intentional.
I'm going to map the processbefore I do it.
So maybe in my 20sI was building ad hoc sales teams,
almost stream of consciousness.
Have a thought. I'm going to do it.
This is what we built nowit's a little bit more refined.
(20:20):
It's hey, have a few thoughts.
Let's talk to keystakeholders. Let's get their thoughts.
Because now I don't think my opinion isactually
I might not be the smartestone on the topic.
I might not have the most valuable input,but we bounce ideas first,
and then we map it, and we map it in a waywhere we think of it and treat it
like a computer program,because we are going to want technology
(20:41):
involvement in the process.Without a doubt.
I in 2006 running a sales Salesforce,you just have a PBX phone system,
all the phones running at the same time.
It's ringing all night talking aboutlead flows today that existed.
Engage AI bots.
You're having, follow up communicationsthat are automating dynamics with your CRM
and your emails,and then your Salesforce is, you know,
either two tiered or single tiered,and the flows are complicated.
(21:06):
And you we mapped those outbefore we build them and
before we execute them, and then we do nothold on to them tightly.
And I think that's the really key part.
What got us from one employee to 12employees
was not the same thing that got us from12 to 40, and and what got us
from 12 to 40 wasn't the same processthat was modeled from 40 to 100.
(21:26):
And we knew that we couldn't go from40 to 100
without a major, major capital investment
or without an acquisition from a majorindustry leader or private equity group.
And so, like,we knew, like me and my co-founder,
we always knew it was like,hey, there's there's levels to this.
Like, we could stop at 12
or 15 sales reps and sort ofkeep it as a lifestyle business.
And then I could have a great lifestyleand there'd never be a middle
(21:48):
layer of management,and it'd be simple business processes.
And if we grew bigger than that, we needmore capital, which we went now, got,
but we would need different processesand technology.
We'd have to start getting involved
and there'd be somethere'd be some drag with that too.
Right.
You're going to lose somesome sales performance
and there's going to be feet dragbecause of the tech.
(22:08):
But getting from 40 to 100,we knew it was going to take
a different type of capital baseand a different type of process.
So to answer your question is no,your processes, not your processes.
And if you don't know the process,don't be scared to ask someone.
Startreaching out to people in groups like,
you know, that acquisition,that acquisition,
like you start reaching out to peoplein your local business community
(22:31):
at the Chamber of Commerce, like, hey,I don't know much about roll ups.
I don't know much about salesautomations. Right?
What do you recommend?
Because if all you do is talk to peopleyou find on the internet that you Google,
they're going to be sales reps,and you're just going to go
bouncing around from productto product to product.
It's always going to be, you know,
if you dry but you can't handle itnever sort of got your head around it.
So that's that.
(22:51):
That's a really long wayto answer your question.
I apologize for it. No, not at all.
That's the process.
And hold it loosely because you're goingto have to iterate it a lot.
So the level
that you've gone to the companynow, you said you've you're past 100
and essenceemployees slows things like that.
(23:13):
And then you, you actually did havean infusion of capital.
Can you explain a little bit moreabout that?
Yeah. No.
So before before we got acquired,and sort of the interim level,
maybe around,between 12 and 20 employees,
we realized that the free cash flow needs,because you're
looking at the bank accountsall the time, we're like, wait a second.
(23:35):
Growing a company like this,and if your revenues coming in
trailing on net 90, invoice terms,but your marketing spend
is forecast out like 30 days,and then the future, you got this 20 day,
120 day gap and free cash flow.
But you're on a growth vertical like this.
So the problem isn't is inherent.
You can't actually fund your own growth.
(23:56):
You run out of runway.
And so theyou know, the initial invested capital,
which was, you know, severalhundred thousand dollars,
which sounds like a lot,but it wasn't not not not no space at all.
It was gone at the end of,you know, eight months.
You said, oh, yeah, eight months.Yeah, yeah, yeah, yeah.
And we were, we were sort of like, okay.
And we knew we didn't,we couldn't sell yet.
Like we knew we didn't have actuallyan asset that was sellable at the time.
(24:19):
And we knew that we hadsome identity issue.
People were not respondingwell to the name Debt Busters.
It turns out that it was a cool name.
Cool for the team?
Not really. Not really playingwell in the larger audience.
So we did two things at once.
We raised capital, through debt.
Because we didn't like the termsthat were coming in on equity.
And, we probably overpaid
(24:41):
on that debt because we didn'twant to give up any equity.
And we rebranded as that to help.
And that was,
you know, an expensive rebrandto do in the middle of our initial growth.
But it was worth it.
And the debt,
the debt was, again, expensive.
And that was because we hadn'tbeen in business two years.
And, you know, sort of an unproven entityon a fast growing team in a
(25:05):
in a spacewhere there is no actual assets.
We weren't developing technology.
There was no code, there's no IP, there'sno physical goods in a warehouse.
They can't factorit can't do merchant cash advances.
Right.So it's a financial services sales firm.
So the assets of the people,
that's that's hardto, it's hard to get investment in.
So we paid a lot for for debtfinancing from other industry players.
(25:28):
And that's what fueled our next roundof growth to take us from, you know, to
what did you end upnegotiating that debt term?
I mean, it was
north to 30% Apr, under 40% Apr.
So that depends on the note.
We ended up with several different notes.
Those were sort of the interest ratesin Apr ranges that we saw.
But you know,
you know, since obviously you, you know,it's it's it's good because you don't have
(25:52):
to give up your equity.
And now you're on a, on a track of,of exiting, you know, that business.
Can you share a little bit,you know, with what you can share.
Yeah.
As far as the definiteor not the definition,
but what you went throughas a owner with the acquisition.
So it was my
first ever successful acquisition,like a selling, selling of a business.
(26:12):
I had, you know, a failed attempt twicein my background.
One company that doesn't existand another company does
exist that that the higher sales levels.
But this decided to stopgrowing and stay private.
I knew
it would be a lot of due diligenceand a lot of attorneys, I don't think.
I don't know, it'ssort of like having a kid.
(26:33):
Everyone told me they expect this or thatwhen I was going to have my first son,
I was like, yeah, yeah,yeah, it's going to be fine.
I have my first kid. My whole God.
So, there's justthere's a lot of due diligence.
And I was very grateful to meand my partner
that we had set up everythingthe way we'd set it up from the beginning.
Even though it was,it was had a lot of cost burden
(26:53):
at the time that stood out largewhen the profit and loss
when that when the gross revenue was low,those line items
really hurt on the bookkeepersand accountants and the structure.
But it paid dividends later because whenthings were starting to get asked for.
Oh, yeah, here's here's our ERPbooks, here's our data files,
here's our bank statementsthat match and reconcile our financials.
(27:15):
And we didn't do a bunch of add backs.
We don't have any, like, personal expensesloaded up into this business at all.
So we didn't have to, like,you know, sit there and do losses or
losses on our add backs.
So it was, it
was cool because we had preparedand mapped intentionally.
It was still a bit intense in
hey we've, we've shaking hands.
(27:36):
We've come to terms in principleand now we're going to go on the 60 day
journey that's usually led by counsels.
And you know, a lot of randomthings can come
up, from different angles, whether it'syour human resources policies.
Do you even haveor human rights versus policies
like we were a California company,that was a major point of concern.
(27:57):
Thankfully,we had brought in a PR organization
because we realized this was a weak spot.
We weren't going to be ableto get acquired unless we had strong HR.
We knew we couldn't fund strongHR in-house, so we brought in the Po,
maybe 7 or 8 monthsbefore we started looking for smart.
And so that that that helped bolster us.
And, it was just it was a process.
(28:19):
And I didn't think I realized beforehandthat it was going to cost money
in that process. But it does eveneven if the sale doesn't go through.
If you're an entrepreneur, you attempt tosell your business and you go into an Loi
and it doesn't successfully close, well,you're still going to have incurred costs
through the through that processof the Loi and the due diligence period.
I'd say the onethe cool thing that did happen is
(28:41):
I was able to talk to a coupleother people who had interacted
with our acquiring companybefore on an Ma basis, and getting that
feedback is something
I would recommend to other peoplewho find themselves in the same space.
Have you talked to someone elsewho's dealt
with the people who are acquiring youin a similar manner?
Right. Like yes.
And being able to talk to like real people
that existed that had,you know, worked with our acquiring,
(29:04):
you know, company in the similar manner,it was like, okay, cool.
We can sort of take them,you know, the goodwill is the goodwill.
And what they're saying isbased or is in their BS or BS.
Because I've been a part of processesbefore where
that wasn't the caseand it's always very shifty.
How many rounds of negotiations
did you have to go throughto get the price that you're wanting,
(29:25):
and how did you start to set the termsand use leverage points?
To get your highest multiple?
Probably two rounds.
We we didn't really go back for a third
because we, we felt we were in
(29:46):
not a weak position,but not the strongest.
We hadn't even had two years since,you know, revenue
productionbegan landfall to use tax returns.
Our growth was meteoric,
but we were also running out of cash flow,and and they knew it.
And all the other partiesthat have been talking to us,
so they they, they knewone of two things was going to happen.
We either had to stop the growthcompletely and and stabilize
(30:11):
or, you know, fund the massiveinfusion or.
Yeah,or get more capital, more debt. Right.
And we we had an offer at the tablefor more debt.
And so I'd say we disclosed that offer.
Like,I don't know if I'd call that leverage.
I just say maybe that's transparencythat gave people things to think about.
Like we do have an alternative here.
Like we have this financing vehiclethat's ready to go.
(30:33):
That is zero equity. It's 100% debt.
And even
in even if the counterpunch to that is,
you know, you're not gonna be able
to take much profitwith those high interest rates.
Amazon didn't take profit from,what, 20 years like.
And I get that everyone citesthat example.
But the point isour mindset at the time was growth.
Not not profit taking, not distributions.
(30:53):
So we had that transparently available.
Hey, we have this financing offer.
We have an alternative in place.
But that was it. Two rounds.
I don't think we were too intensein our negotiations.
Their starting offer was fair.
And the way we had met, we weren'teven really on the market for sale.
We didn't have a business brokerwho had listed us or anything.
(31:14):
It was just
some people knew we were out there
looking for capitalbecause we were really on the set.
We wanted, we want, we want.
Our initial mindset was,
let's hold the companyanother year or two, let's go get that.
And then these,
these gentlemen approached and said, hey,we think there's another path
that you guys should explore.
And we ended up likingit a little bit better.
And I love this.
This is such a good story.
(31:35):
I think more or more founders need tounderstand what you what you went through.
You know, you went from
intentionally developing a companythat would be worth buying, right?
And then you had structured itall accordingly.
You had obviously it wasn't perfect.
And again, what are some thingsthat you learned throughout this process?
I think that's probablyone of the biggest things.
(31:56):
Some takeaways from your initialbecause now, I mean it's two years.
You still know what you shouldand shouldn't have done.
Yeah. And and we're still making mistakes.
I'm still making mistakes right now.
You know, so me and my partnerwere talking over this weekend about,
you know, things that we need toget better at. Yeah. And so
one thing that
I think we both regretwas the pace of growth.
(32:19):
I think we, I think we overredlined ourselves multiple times.
It was fun, but it was reckless.
I sort of feel like a moto GP racingmaybe just went a little too close,
maybe a little bit too much lean anglea couple times.
And it almost caused disaster multiple times.
(32:40):
Like if, if we hadn't
had relationship and community,
in the business community,in the industries that we were operating
in, and been known as,hey, these we're they're good dudes.
They're doing they're doing good work.They're not going to poach your people.
Anything like that. We got bailed outa couple times from from wreck.
So I'd say we we over overheatedthe engine twice, maybe three times.
(33:04):
And, you know, when you get a 200% growthrate in a single month or,
you know, a 40 day period,you got to watch out for that because
there's really no way to fund that,especially if you're undercapitalized.
Yeah, yeah.
Because and then you can't really predictper se how fast you're going to grow.
No. You know what I mean.
You can only just try to grow and thenall, you know, and that's what happened.
(33:25):
And then it was like, but even then,like we didn't throttle back
and maybe we should.The other thing I'd say is this.
While I've been
very successful at training new salesprofessionals, and,
you know, my partner has been very goodat building company culture, you know,
and we've been engaged doingthe things that we're asking people to do.
(33:46):
I think we need to do a better job
in the past and todayof training other leaders to come up
beside us and really empower themto take the next steps in their careers.
And so I think that'swhat we're focusing on right now.
Like, how do we trust more and how do we
how do we not do less, but sort ofmake ourselves a little bit smaller
but still be present?
Like, I don't want to be an absentee ownerat this point.
(34:07):
It's not it's not on the table.
But how do I how do I helppeople take their next step?
And, and in the process of doing that,how does that help our firm?
Because it's needed.
Like we've gotten to a sizewhere my my share will of of,
you know, what I think should happen
or my energy level or however muchI want to show up on a holiday and work
(34:27):
that's not going to drive usfrom 100 employees to 200.
That's not going to drop us from 70million a year in revenue to 150 million.
It's going to be a much bigger team.
And that team,
if I want to stay true to what the companyis, it needs to come from inside.
So I'd say those are the two thingsI would do differently.
I would slow down growth a little bit.
And the second thing is invest more timein training other people
(34:50):
how to do the higherlevel work, like help them like
even if it doesn't come with paylike they would like.
Your sales managers would love to managea vendor relationship.
Like they would love to do that, right?
Because they just start start giving themstart giving them challenges that
that enable them to be a little bitmore empowered as opposed to non.
(35:10):
Yeah, absolutely.
If they think it's just a job,you're going to get just job results.
Right.
And it's so that, you know and like I saideveryone uses the buzzword culture.
I get it and everyone uses it.
But I never ask, youknow, people to show up.
If we're not going to show up.
We take people to dinner.
We spend time with their familieslike that.
(35:31):
That is sort of.
But I understand that's not available at 3or 4000 employees,
but in our size, that's a lot.
What's happened to build the culture?
It's interesting, though,because the founder is typically one
like yourself who has a gung ho attitudeand and is a roll up the sleeves.
I'll do whatever it takes.
And that doesn't actually even get you towhatever level that you're talking about.
(35:54):
From 100 to 200.
No, it's not even that.
It's it's extremely strategic.
It's playing chess and not just checkers.
You know,you're looking at the big picture
and you're starting to implement,
you know, and also become moreof more of the leader and the visionary
as opposed to operational operations,operational professional.
(36:16):
You know what I mean?That's correct though.
And if you map that out and that'swhat we're doing right now, we're mapping.
Just like I said, we map 12 to 40,not 40 to 100.
The BPMs that we're drawing up todaylook nothing like the BPMs that got us
here, that these business processeslook very different.
There's going to bea little bit more management fee drag.
(36:37):
Our margins
need to be a little bit more efficientin other places to make up for it,
but that's okaybecause that's what it's going to take.
It's going to take usto be really intentional, map
the business processes, empowerother people to be leaders,
and then sort of orchestratethe whole thing
and lead and lead the whole thingfrom from the front.
But not necessarily, as a specialistare doing, doing the things
(36:59):
I've got one.
Well, probably like I'm surewe could probably banter for many, many.
Bauer's actually on this specific topicof growth, development, culture and scale.
But, can you share with us real quickthe technical
when you say map,what exactly do you do when you map?
And how do you set up a session?
(37:20):
That would be,that would be very valuable for somebody.
I know you say map,but maybe it's physically drawing ones.
Oh, it is, it is.
And, you know, it's business processmodeling or business process mapping.
Right.
Okay.
The those are the two termsthat I've seen and you seen used for it.
And to me it feels like an ERD.
That's an entity related designthat comes from the data world.
(37:41):
And so I told you, I'ma nerd, like my second loves data.
And so I got like it too.
Yeah.
So, you know, when you're talkingabout data architecture,
use these entity related designsto show how the different pieces of your,
your business intelligence systemis going to work together?
A single database going to be over here,and it's going to be, you know,
the symbol, and we're going to have our,our, our server over here.
(38:03):
And it's this symbol,
we're going to use this powerBI over here and Power Automate over here.
And you map it all out.And they all have symbols.
And so the business processmodeling is very similar to that.
Instead of just tech piecesit's all the pieces right.
And so you know you might have,you know, a symbol representing,
you know, a group of humansor an individual human, a team member.
You might have another symboloperating a computer structure
(38:26):
or a computer applicationor a web based application.
You might have a different onefor your CRM,
and your CRM is usually goingto have multiple aspects to it.
It's probably talking to other things.
Maybe you're using something codeless like Zapier,
or maybe you'reusing built in integrations,
but no one's using just like,you know, Salesforce Core, right?
You're going to have other things on it,
or, you know, whatever CRM you're using,if you're using something different,
(38:46):
you built something.
So when I talk about mapping,
how big are our sales teams going to be?
What's that look like? Map like? Okay.
Do we have one leader here.
And they're responsible for everythingthe time and attendance.
Culture and sales trainingand or do we have a second coach,
like a performance coachthat focuses on sales.
Know what to do, and thenwhere does that information flow to
(39:08):
and how does it how does it comeinto your progressive discipline policy?
Does it flow into like, sort of HRpeople, team center that then enforces
progressive disciplineor your manager's doing that.
And while they soundlike abstract questions
that maybe aren't important to your teamat 15 employees or 40 employees,
without that processmapped and implemented effectively,
(39:30):
managing 150 or 100 people is unwieldy.
And it's uncontrollable. Yes. Right.
And so you have to have things like thisset up ahead of time, right.
What's the relationshipbetween our openers and our closers
and what's that mapping look like?
And when what happens when our managershave disagreements between
sales teamsor between our leaders and our closers.
And that needs to be mappedout of the decisions get made.
(39:52):
How do they get arbitrated?
And so right now, we're in the processof physically drawing out the maps
of how we have to gofrom where we are today
to something that can support250 employees.
That's our target is 250 on this nextquarter, have they created an eye map tool
for business systems creation?
Oh, that'd be cool.
Yeah, that'd be cool. Yeah.
(40:13):
Right now I you saw my dry.
There's a few tools,but none of them are, like,
none of them are making recommendations.
There's no autofill yet. Them.
Yeah. That's interesting.
Yeah.
Because we're seeinga lot of advancements in AI, and I'm.
I just been obviously interviewinga bunch of people that are buying
and selling companies and creatingefficiencies within organizations.
(40:33):
And I'm like, wait a second,is this another entry point?
Yeah, could be a technology.
Could this be the light bulb?
Yeah, yeah.
And is that a product? Yeah, absolutely.
Well, look, again,we could probably talk for hours and,
you know, we do a really appreciateyou coming on the acquisition
IQ podcast as well as helping to build thethe entire network as a founding member.
(40:55):
So for that, we thank you.
We are excited to have you.
I don't know if you have committed fullyor if you'd like to be a part of the Aqua
Con conference.
But guys, ladies and gentlemen, out there,if you guys have haven't heard
or if you have heard, Aqua Con is comingto Salt Lake City on September 3rd, 2025.
It's going to be great.
(41:16):
I'll be there. Well, and it will.
And how we've structuredthe room, it's very curated.
So individuals just like, Chris here
will be seated at eight peopleper round table.
And as far as that round tablegoes, we'll have about 300 individuals
at this conference.
We'll talk about fund creation andhow you can develop your investment fund.
(41:36):
Then we'll move onto how you can acquire companies.
And then leveraging financial,you know, like you,
for example,you leveraged debt for a little while
and then we've got private equity, familyoffice, venture capital, or you have,
you know, a high net worth individualfor that capital stack.
And then movingon, we've got our sell side panel,
(41:57):
which we'll discuss, obviouslyprepping for sale, making sure
that we have maximal value upon your exit
and really just an overall experiencethat the operator of a company,
an M&A service provider or a seasoned
investor would have a great timemeeting with people
like Chris, are meeting with othersthat can speak the same language
(42:20):
that's been there, done that.
So that's whatwe're developing at Aqua Con.
We would look forward to having you guysthere as well.
If you like today's episodeon the acquisition IQ podcast,
feel free to like and subscribeon our YouTube channel.
And then also send thisto your founding friends who are scaling
their companies that have sales teamsthat have, you know, various systems
(42:43):
that need to be mapped out,like what we discussed earlier today.
And then just loves data, you know?
So anyway,thanks a lot, Chris, for joining us.
This.
And we look forward to making more podcasts just like this for you guys out there.
(53:03):
Thank you so much
for tuning in to the acquisitionIQ podcast.
My name is Nathan Birdand I'll be your host today.
Today we are joined with Chris Warren.
Chris is the co-founder of debt Dot help.
He helps businessesturn chaos into clarity
with deep expertise in strategic planning,data analytics and team optimization.
(53:24):
He builds high performing operationsby combining leadership systems,
smart sales teams, decisionmaking with also
an MBA in leadershipand a master's in Business Analytics.
Chris operates at the intersection ofrevenue growth and operational excellence,
making him the go to expert for founderslooking to scale.
(53:45):
Thank you so much for joiningthe acquisition IQ podcast today.
No, it's good to be here.
Good to see you again, Nathan.
Absolutely.
You know, it's always good toI obviously continue communications
with all of our founding membersas a part of the network,
but also just founders that are growingfounders that have grown, and founders
that are wanting to help others
(54:06):
throughout the problemsthat they typically will face in business.
So share with usa little bit more of your background
and what got you intowhere you're in today.
Yeah, no, not a problem.
So sales is my first love, right?
You know, I,
as a young, as a young professional,it was, right out of college meeting.
Didn't, didn't graduatethe first time around.
(54:27):
Had to go back and do that much later.
Got into sales, did a lot of time in sales at all levels,
started, you know, telemarketing businessdevelopment representative.
To closer to team leads to management,to founding my own company
and sales company.
You know, over the years,been in sales for financial services
for, home based construction services,
(54:49):
business to business serviceslike marketing and agency.
You know, recently back in 2022,
me and, longtime business associatedecided to get into the debt relief space.
So in March 2023, you know, I co-foundedand we launched that that help.
Back then, it was branded debt busters.
You know, and the theme was,your superheroes to get you free
(55:13):
from debt.
So March, March 1st, 2023 was meand my partner and one employee,
from a Craigslist ad in a 400 squarefoot office in Sacramento.
And, I think our initial investmentand operational budget
was blown in about three weeks.
And so it was, a journeythrough that first year of,
failing forward, going back,finding more financing, fixing cash flow
(55:35):
problems, building sales revenue,operation systems that would last,
getting corporate governanceand order and accounting in order
that we would go through M&A scrutiny and,
and build the type of companythat investors want to see and invest in.
So we were able to grow from there
and sort of leverage what my second loveis, which is data and systems.
(55:56):
You know, my wife got back the collegedegree, went got a graduate degree in MBA
and then gotten a graduate degree in dataanalytics and,
leverage that to just keep buildingsome great systems that were data driven.
And so my opinion could mattera little bit less.
I could get smallerso my team members could get bigger.
And, it turns out they really like it
when I intentionally make myself smallerso they can get bigger.
(56:19):
And, we were able to grow and grow and grow.
We were able to sell the companywithin 24 months of, of going into revenue
production.
So and I'm still todaythe co-founder and CEO of,
of thatto help into into an earn out period.
So I'll probably be with the firmfor years to come.
Let's talk a little bitabout how you prepped your company.
(56:40):
And, you know,sometimes people aren't as proactive
as as what you're saying as far aswhen you first entered into the business.
So that's a 24 months.
So you must have had already already knownwhere, in essence,
you wanted to go by the end ofor that growth.
I mean, you don'tobviously know everything, right?
But you've got to set up some parameters.
(57:00):
Well, if you're if you're an entrepreneurand you're founding a company,
ideally you
desire either an exit or majorcapital investment at some point. Yes.
And so both of those are going to requiregovernance and business processes
from the beginning, or at least very,very early in your company's genesis.
Because even if your position is whyI want to retain equity
(57:22):
and ownership and control,and I don't want to go through an exit
like sell to a traditional companyor P firm that might take it over.
Either way, your books have to be builtin a way that, you know, investment
bankers can get into and understandand speak a common language once,
and you can pass muster with.
So we started that early CE,and that's good because I've spoken
(57:43):
with a lot of business owners
and then also service providersthat are constantly saying
that business owners are behind the ballin the preparation of what their initial
or what their end resultthey desire to have.
So yeah, it's is an infusion.
It's not an exit, you know.
Yeah, it's a problem.
I meet people all the time who seek maybecounsel or help or business consulting.
(58:08):
Fundamentally,
the questions that are going to getasked, are almost
always going to be the same,and they're always going to revolve
accounting metricsand KPIs around profit and loss.
And you have to educate yourself, likeeven if your education's done,
you know, I highly recommend going backand getting at least certificate level
understanding of accounting, double entryaccounting methods, and QuickBooks,
(58:29):
and how to read your panels and balancesheets and really sort of digging in
deep there, even though that wasnever my first or second love.
I went got an associates in accountingbecause I knew
I had to speak the language.
I knew I had to incorporatelike fundamental best practices.
So when we sat down with accountantsand bookkeepers to organize books before
a company was even producing revenue ofof substance, I knew where we were going.
(58:51):
And so that's just that's fundamentallythe advice I learned in my 20s
was I used to build thingswith having no idea of where I was going,
and everything was trying to get pickedup, like after I'd already done something
and what's,
you know,everything's done on an Excel spreadsheet
and single entry and it doesn't workand no one wants to invest in it.
There's no governance,no one wants to buy it.
And so you definitelywant to get that dealt with upfront.
(59:15):
Isn't that interesting?
Because think about it.
As a founder, you spend so much timeat the start and the onset of the creation
of your companywith a bunch of ideas and vision
and zero clarity on
what what you are initially wantingto create, you know, for, for the world.
And it doesn't really discredityour energy that you put towards
(59:36):
a project.
It's just a matter of,you know, doing it the right way.
And I think that, you know, you're
living proof that you've done it reallya little bit of a better, better way.
But obviously it takes a lot of failureto be able to get to that point.
Absolutely.
I mean, in the last five years long,I've got three failed business projects,
you know, that I was either a co-founderon or consultant on, another business
(59:59):
that we were able to sort ofin a consultant role,
you know, take sales from,you know, 45, $50,000
a month in revenue to well over half$1 million a month in revenue.
And I while I failedto get that company through an exit,
you know, they're still around today.
They're still maintaining the revenuelevels that I was able to scale it to.
But, you know, three, three failedattempts, right?
(01:00:21):
Starting businessesand all sorts of spaces, you know, and,
you know, one consultant role thatI was able to scale successfully and build
the business processes up for and reallyget the best practices around sales.
And my first love, because acquiring the customers
is that's to me,it's it's the majority of the show.
But we did fail to get that companyexited,
(01:00:42):
you know, and so I sort of transitionedto what was next.
And this was what was next.
This is good.
Well, I'm going to get intosome strategic questions here.
I will I want to make surethat we're providing some value.
Not so that we haven't already.
I just want to make surethat we're tactical.
So what do you believe most about,you know, high performing teams
and what what are some thingsthat you've experienced in your life
(01:01:04):
as far aswhat doesn't make a high performing team?
And what does
what makes a high performing team
is when the things that you're practicallyasking your team to do,
when you're doing them with them,
and everyone buys in and understandsthe asks and the mission,
and the mission sometimes can besomething that's unreachable, unreachable.
(01:01:25):
So I hope our vision is to build a debtfree America
of, like, just on the face of it,that's that's an impossible task, right?
You know, our government's, you know, $37trillion in debt or whatever,
and consumershold $1.4 trillion of credit card debt.
But that's an impossible vision.
But that's okay,because the team understands
(01:01:45):
the why behind itand why we're passionate about it.
And the value that we're providingis inflation continues to drive up
pain points for consumers and credit cardinterest
rates, you know, near 30% on average.
And then when when I'm operationallytelling people on a practical level here,
this is what we're asking you to dothis on a daily level.
This is what we're asking you to do thiswith this software piece.
This is why we're trying to do this.
(01:02:06):
It makes the leadership job longer
and more difficult,that they have more buy in.
And the second, to understand the whybecause you should you know, ideally
you're hiring competent, intelligentpeople who are hard working like yourself.
And so typically with intelligent,hardworking people, if you tell them the
why they're going to come with youand they'll do what
you're asking them to doas long as they see you doing it yourself.
(01:02:29):
And so the heartbeat of any companyI've ever been successful at,
whether it was as an employee,as a manager,
when I built, when I was trying
to do consultant scale for or this,this project that I'm currently a part of,
it has been driving customer acquisitionthrough a culture that empowers sales
professionalsto do excellent work in the field
of getting peopleto say yes to a value exchange and
(01:02:54):
that's sort ofbeen the driving heartbeat of any project
I've worked on,even on, digital physical goods sales.
Yes, you're right, it's similar.
So that's because there is, you know,there's copy, which is in essence
just going to be your digitalthere's the marketing piece
that's going to sparked one's interestin to what they should say yes or no to.
(01:03:14):
And then there's also the correspondencethat must be had.
As one, you know, has that interaction.
Can you explain deeper as to the sales,the sales training
that you've been able to implementthat then creates that excellence of,
of sales culture inside of a business?
(01:03:35):
I'd say that's just radical transparencyin a feedback loop, where first we enable
and sort of empower our team membersto lose all defensiveness.
And that starts with me.
And so, like my door is always open,I not only offer myself up for feedback,
but I actually beg them to,hey, if you see something I'm doing
just because you're, you know, maybea business development rep and I'm the CEO
(01:03:59):
and you have an idea or you see somethingthat we're doing wrong or something I'm
doing wrong, I actually invite thatfeedback immediately, and I want that.
And the second I see that,I can take that and heal and hear
that when I'm running a training session,I'm asking them the same thing.
Hey, don't be defensive before coaching.
You know, like if we're trying
if we're trying to get you to a placewhere you can be successful
(01:04:19):
and you can be financially free,and you can have relationships and build
rapport with all sorts of people, all egoand defensiveness sort of has to go away.
And we have to learn how to do things,because typically humans don't enter
into relationship and ships,business exchanges or value exchanges
with subject matter experts.
(01:04:40):
You know,they're not buying cars from engineers
who can understandhow the engines work, right?
They're not they're not buying housesfrom civil engineers who can talk to you
about, the weight load and the wind loadcapabilities of the roof.
Right.
People engage in interactions and valueexchanges with people that they trust,
that they can relate to,and with a value offering
(01:05:00):
that they believe is fair or goodor beneficial to them or their family.
And so that's sort of the corethat's the stuff we put in the soup.
That's so good.
I mean, you're not buying a softwarefrom the technical founder who only codes.
No you're not.
And and typically ifif a founder is like a technical guru,
(01:05:21):
very rare is the individual
who is sort of like a technical geniusand really masterful at soft
skills and interpersonal relations.
I'm not saying they don't exist.
I'm just saying,you know, it's rare to find, hard to find.
Yeah.
And sort of having a diversityin your workforce
of talents and like,how how do you how do you get that,
(01:05:43):
that breadth of relatabilitywith your target audience?
And I'd say the second piece of the salesthat I really like to train on is
how do wehow do we sell our product to someone
who is only tangent, highly interestedin our product, or has low intent?
And can we find populations or,
avatarsthat maybe haven't opted in all the way?
(01:06:04):
They're not high intent, but we knowthey're right next to our typical avatar.
And how do we
how do we train a sales professionalto take someone with mild, lukewarm
or cold interest
and get them
to pitch, presentand sell in an effective manner,
where people engage in the conversationand hear about it from our sales reps
and sort of, next to space.
(01:06:27):
And that'sthat's something we've always done well.
And I say we just the people I've workedwith over the years in a couple different
sales contexts is, hey,if we try to approach this thing head on,
we're going to have a lot of turbulence
from major enterprise playersin the same marketing spaces.
So how can we asymmetrically get as closeto the space
of the avatar as possible,and then learn how to sell really well,
(01:06:50):
let's, create a scenario right now.
Almost like a roleplay, around a scenariothat one would have objections.
I love to always do this
because, like, we we're in saleswhether we like it or not.
I personally love sales.
I love interacting with people,getting to know what their pain points are
and just getting to knowthe relationship really.
But let's create a scenario, right?
(01:07:12):
You just called me and you know,
you went through form family,occupation, recreation, money.
You're starting to find some pain points,but I've got a little pushback,
you know, as to what it isyou're you're providing.
This could be both product or service.
It doesn't have to bewhat you're currently providing.
What what's your next step? Like?
I'm literally like,
(01:07:33):
I'm not sure I need to go talk to myI know how going to go talk to my spouse.
I need to think about it.
Yeah.
So so the way I've always operatedas both, a sales professional,
sales trainer and manager.
And now how we run this company here is,
we don't provide,you know, written quotes.
And, the reason forthat is usually if you're telling me
(01:07:55):
that you need time to think about itor you need time to talk to your spouse,
that usuallyrepresents an underlying objection,
because human psychology is tough,and human psychology is telling you
to tell me that because in realityyou don't trust me
or believe in the product enough,but you don't want to hurt my feelings.
So you're just telling me you need to gothink about it and talk to your spouse?
And for my for for ourfor our sales team members.
(01:08:17):
The easiest thing for them to dois to give you a written quote,
because then it gets them out
of an uncomfortable conversationof confronting sort of what is thought
to be an implicit dishonestyin your request to get off the phone.
And and the reason I bring uphuman psychology is because we always will
tend to flee from discomfortand flee towards comfort.
And and I always am telling our team like,hey, the most
(01:08:40):
the most successful place that we can beis the place that is the least comfortable
this person is telling youthey want off the phone
because they need to think about it.
What they're telling you isthey maybe can't relate to you,
they don't trust you,and they're not sure of your value.
Offering one of these three.
But they're not going to tell you that.
They're not going to say,hey, Nathan, I don't trust you.
So I'm going to get off the phoneright now.
(01:09:00):
Like,you know, it's just not polite, right?
So they're saying a polite thing,you know?
I'll talk to you later about this. Okay?
So we try and come back.
Well, you know, sir, ma'am, in my lineof work, I've been doing this a long time.
Licensed professional.
Usually when I hear something like that,there is an underlying concern.
There is an underlying problem.
There's something that you might not like,understand about the product.
(01:09:22):
That's just been typically my experience.
I'd just like to ask,
is there anything that is making youhesitate
right now from taking these savingsthat are on the table for you
today might not be on the table tomorrow.
I don't know what'sgoing to happen tomorrow,
but I do know that right nowI'd be approved for this.
And it sounds likeyou have some more questions.
And I got all the time in the world,so why don't we just talk about them?
What's on your mind?
(01:09:42):
And I would always continueto try and keep that conversation going.
Especially when you're talkingabout direct to consumer,
not business to business.
That's a totally different approach.
And so but most of my professional careerhas been DTC direct to consumer.
If you're talking business to business,
if they need that,if they say they need to think about it,
(01:10:05):
you need some more probingquestions like,
what do you mean, doesit need to go to a board for review?
Does you know who who are the signer?
It's a whole different conversation.
But hopefully I answered your question.
Yeah. You frame it.
You know, since you kind of, you know,you can repeat back as to what they said.
And just to make sure that you understand,I would also, you know, maybe
you can even address it,knowing that those are
(01:10:27):
the three specific scenariosthat people typically will address.
You just say, hey, listen,you're not going to hurt my feelings.
You know? That's right.
I mean, because that's just one of the,you know, one of the oppositions
that you're going to come againstand then maybe, you know,
whatever else you just laid out,just simply just state it.
Right. Not to be uncomfortableI always tell.
(01:10:48):
So it's very comfortableto send out a call.
You got like a 5% chanceever talking to that person again.
Just be uncomfortable.
And and if they see you being vulnerable,they might trust you to get
a little bit more vulnerable and actuallytell you what's on their mind.
And then if they tell you
what's on your mind now, you have a chanceto deal with the real objection.
Well, we find that, obviously in sales,like nobody wants to be.
(01:11:11):
Nobody really wants to be sold.
No, right off the bat.But they love to buy.
We love them.
Yes, they do, you know,and it's really just important for us
to, to understand that, you know,as one who's either running a business or,
like you say, it'sspeaking to people because,
you know, even in your position,you're the CEO, you have a team,
(01:11:34):
but you're always talking about peopleyou know,
or about the offeringthat you have in an in, in essence,
a sales scenariothat could quickly turn into, hi,
I actually have a solution to your problemand this is what we can do.
So I think it's, you know, importantto have that understanding.
Gosh. Yeah.
(01:11:55):
So that so in essenceyou've got a company and, and,
and every form of salesis within the company.
But I'd ask specifically how
how you've been able to
radically transform the current,you know, kind of your current company
and some of the thingsthat you implemented from, from leadership
(01:12:17):
to team and then to execution.
How did you go from, you know, the garage
to building out the sales team?
And you know what I mean?
Yeah, that processlike so it was very different than it was,
you know, maybe in 2005 or 2008, you know,I'm dating myself a little bit now, but,
you know,
you were talking about somethingthat many people today would call revenue
(01:12:39):
operations, right?
They'd start talking about rev upsand automation of sales processes
and this is where, you know, I
you I left college the first time and,you know, in my late teens and early
20s and I had to go backand do it later. I did late 20s and 30s.
And I
never understood thethe breadth of the learning that I missed.
(01:13:00):
And so, you know, getting graduate degreesin business processes, data analytics,
coming back to building teams,
I was much more intentional.
I'm going to map the processbefore I do it.
So maybe in my 20sI was building ad hoc sales teams,
almost stream of consciousness.
Have a thought. I'm going to do it.
This is what we built nowit's a little bit more refined.
(01:13:24):
It's hey, have a few thoughts.
Let's talk to keystakeholders. Let's get their thoughts.
Because now I don't think my opinion isactually
I might not be the smartestone on the topic.
I might not have the most valuable input,but we bounce ideas first,
and then we map it, and we map it in a waywhere we think of it and treat it
like a computer program,because we are going to want technology
(01:13:44):
involvement in the process.Without a doubt.
I in 2006 running a sales Salesforce,you just have a PBX phone system,
all the phones running at the same time.
It's ringing all night talking aboutlead flows today that existed.
Engage AI bots.
You're having, follow up communicationsthat are automating dynamics with your CRM
and your emails,and then your Salesforce is, you know,
either two tiered or single tiered,and the flows are complicated.
(01:14:09):
And you we mapped those outbefore we build them and
before we execute them, and then we do nothold on to them tightly.
And I think that's the really key part.
What got us from one employee to 12employees
was not the same thing that got us from12 to 40, and and what got us
from 12 to 40 wasn't the same processthat was modeled from 40 to 100.
(01:14:29):
And we knew that we couldn't go from40 to 100
without a major, major capital investment
or without an acquisition from a majorindustry leader or private equity group.
And so, like,we knew, like me and my co-founder,
we always knew it was like,hey, there's there's levels to this.
Like, we could stop at 12
or 15 sales reps and sort ofkeep it as a lifestyle business.
And then I could have a great lifestyleand there'd never be a middle
(01:14:52):
layer of management,and it'd be simple business processes.
And if we grew bigger than that, we needmore capital, which we went now, got,
but we would need different processesand technology.
We'd have to start getting involved
and there'd be somethere'd be some drag with that too.
Right.
You're going to lose somesome sales performance
and there's going to be feet dragbecause of the tech.
(01:15:12):
But getting from 40 to 100,we knew it was going to take
a different type of capital baseand a different type of process.
So to answer your question is no,your processes, not your processes.
And if you don't know the process,don't be scared to ask someone.
Startreaching out to people in groups like,
you know, that acquisition,that acquisition,
like you start reaching out to peoplein your local business community
(01:15:34):
at the Chamber of Commerce, like, hey,I don't know much about roll ups.
I don't know much about salesautomations. Right?
What do you recommend?
Because if all you do is talk to peopleyou find on the internet that you Google,
they're going to be sales reps,and you're just going to go
bouncing around from productto product to product.
It's always going to be, you know,
if you dry but you can't handle itnever sort of got your head around it.
So that's that.
(01:15:55):
That's a really long wayto answer your question.
I apologize for it. No, not at all.
That's the process.
And hold it loosely because you're goingto have to iterate it a lot.
So the level
that you've gone to the companynow, you said you've you're past 100
and essenceemployees slows things like that.
(01:16:16):
And then you, you actually did havean infusion of capital.
Can you explain a little bit moreabout that?
Yeah. No.
So before before we got acquired,and sort of the interim level,
maybe around,between 12 and 20 employees,
we realized that the free cash flow needs,because you're
looking at the bank accountsall the time, we're like, wait a second.
(01:16:39):
Growing a company like this,and if your revenues coming in
trailing on net 90, invoice terms,but your marketing spend
is forecast out like 30 days,and then the future, you got this 20 day,
120 day gap and free cash flow.
But you're on a growth vertical like this.
So the problem isn't is inherent.
You can't actually fund your own growth.
(01:16:59):
You run out of runway.
And so theyou know, the initial invested capital,
which was, you know, severalhundred thousand dollars,
which sounds like a lot,but it wasn't not not not no space at all.
It was gone at the end of,you know, eight months.
You said, oh, yeah, eight months.Yeah, yeah, yeah, yeah.
And we were, we were sort of like, okay.
And we knew we didn't,we couldn't sell yet.
Like we knew we didn't have actuallyan asset that was sellable at the time.
(01:17:23):
And we knew that we hadsome identity issue.
People were not respondingwell to the name Debt Busters.
It turns out that it was a cool name.
Cool for the team?
Not really. Not really playingwell in the larger audience.
So we did two things at once.
We raised capital, through debt.
Because we didn't like the termsthat were coming in on equity.
And, we probably overpaid
(01:17:44):
on that debt because we didn'twant to give up any equity.
And we rebranded as that to help.
And that was,
you know, an expensive rebrandto do in the middle of our initial growth.
But it was worth it.
And the debt,
the debt was, again, expensive.
And that was because we hadn'tbeen in business two years.
And, you know, sort of an unproven entityon a fast growing team in a
(01:18:08):
in a spacewhere there is no actual assets.
We weren't developing technology.
There was no code, there's no IP, there'sno physical goods in a warehouse.
They can't factorit can't do merchant cash advances.
Right.So it's a financial services sales firm.
So the assets of the people,
that's that's hardto, it's hard to get investment in.
So we paid a lot for for debtfinancing from other industry players.
(01:18:32):
And that's what fueled our next roundof growth to take us from, you know, to
what did you end upnegotiating that debt term?
I mean, it was
north to 30% Apr, under 40% Apr.
So that depends on the note.
We ended up with several different notes.
Those were sort of the interest ratesin Apr ranges that we saw.
But you know,
you know, since obviously you, you know,it's it's it's good because you don't have
(01:18:55):
to give up your equity.
And now you're on a, on a track of,of exiting, you know, that business.
Can you share a little bit,you know, with what you can share.
Yeah.
As far as the definiteor not the definition,
but what you went throughas a owner with the acquisition.
So it was my
first ever successful acquisition,like a selling, selling of a business.
(01:19:16):
I had, you know, a failed attempt twicein my background.
One company that doesn't existand another company does
exist that that the higher sales levels.
But this decided to stopgrowing and stay private.
I knew
it would be a lot of due diligenceand a lot of attorneys, I don't think.
I don't know, it'ssort of like having a kid.
(01:19:37):
Everyone told me they expect this or thatwhen I was going to have my first son,
I was like, yeah, yeah,yeah, it's going to be fine.
I have my first kid. My whole God.
So, there's justthere's a lot of due diligence.
And I was very grateful to meand my partner
that we had set up everythingthe way we'd set it up from the beginning.
Even though it was,it was had a lot of cost burden
(01:19:57):
at the time that stood out largewhen the profit and loss
when that when the gross revenue was low,those line items
really hurt on the bookkeepersand accountants and the structure.
But it paid dividends later because whenthings were starting to get asked for.
Oh, yeah, here's here's our ERPbooks, here's our data files,
here's our bank statementsthat match and reconcile our financials.
(01:20:18):
And we didn't do a bunch of add backs.
We don't have any, like, personal expensesloaded up into this business at all.
So we didn't have to, like,you know, sit there and do losses or
losses on our add backs.
So it was, it
was cool because we had preparedand mapped intentionally.
It was still a bit intense in
hey we've, we've shaking hands.
(01:20:39):
We've come to terms in principleand now we're going to go on the 60 day
journey that's usually led by counsels.
And you know, a lot of randomthings can come
up, from different angles, whether it'syour human resources policies.
Do you even haveor human rights versus policies
like we were a California company,that was a major point of concern.
(01:21:01):
Thankfully,we had brought in a PR organization
because we realized this was a weak spot.
We weren't going to be ableto get acquired unless we had strong HR.
We knew we couldn't fund strongHR in-house, so we brought in the Po,
maybe 7 or 8 monthsbefore we started looking for smart.
And so that that that helped bolster us.
And, it was just it was a process.
(01:21:22):
And I didn't think I realized beforehandthat it was going to cost money
in that process. But it does eveneven if the sale doesn't go through.
If you're an entrepreneur, you attempt tosell your business and you go into an Loi
and it doesn't successfully close, well,you're still going to have incurred costs
through the through that processof the Loi and the due diligence period.
I'd say the onethe cool thing that did happen is
(01:21:44):
I was able to talk to a coupleother people who had interacted
with our acquiring companybefore on an Ma basis, and getting that
feedback is something
I would recommend to other peoplewho find themselves in the same space.
Have you talked to someone elsewho's dealt
with the people who are acquiring youin a similar manner?
Right. Like yes.
And being able to talk to like real people
that existed that had,you know, worked with our acquiring,
(01:22:07):
you know, company in the similar manner,it was like, okay, cool.
We can sort of take them,you know, the goodwill is the goodwill.
And what they're saying isbased or is in their BS or BS.
Because I've been a part of processesbefore where
that wasn't the caseand it's always very shifty.
How many rounds of negotiations
did you have to go throughto get the price that you're wanting,
(01:22:29):
and how did you start to set the termsand use leverage points?
To get your highest multiple?
Probably two rounds.
We we didn't really go back for a third
because we, we felt we were in
(01:22:50):
not a weak position,but not the strongest.
We hadn't even had two years since,you know, revenue
productionbegan landfall to use tax returns.
Our growth was meteoric,
but we were also running out of cash flow,and and they knew it.
And all the other partiesthat have been talking to us,
so they they, they knewone of two things was going to happen.
We either had to stop the growthcompletely and and stabilize
(01:23:14):
or, you know, fund the massiveinfusion or.
Yeah,or get more capital, more debt. Right.
And we we had an offer at the tablefor more debt.
And so I'd say we disclosed that offer.
Like,I don't know if I'd call that leverage.
I just say maybe that's transparencythat gave people things to think about.
Like we do have an alternative here.
Like we have this financing vehiclethat's ready to go.
(01:23:36):
That is zero equity. It's 100% debt.
And even
in even if the counterpunch to that is,
you know, you're not gonna be able
to take much profitwith those high interest rates.
Amazon didn't take profit from,what, 20 years like.
And I get that everyone citesthat example.
But the point isour mindset at the time was growth.
Not not profit taking, not distributions.
(01:23:56):
So we had that transparently available.
Hey, we have this financing offer.
We have an alternative in place.
But that was it. Two rounds.
I don't think we were too intensein our negotiations.
Their starting offer was fair.
And the way we had met, we weren'teven really on the market for sale.
We didn't have a business brokerwho had listed us or anything.
(01:24:17):
It was just
some people knew we were out there
looking for capitalbecause we were really on the set.
We wanted, we want, we want.
Our initial mindset was,
let's hold the companyanother year or two, let's go get that.
And then these,
these gentlemen approached and said, hey,we think there's another path
that you guys should explore.
And we ended up likingit a little bit better.
And I love this.
This is such a good story.
(01:24:38):
I think more or more founders need tounderstand what you what you went through.
You know, you went from
intentionally developing a companythat would be worth buying, right?
And then you had structured itall accordingly.
You had obviously it wasn't perfect.
And again, what are some thingsthat you learned throughout this process?
I think that's probablyone of the biggest things.
(01:24:59):
Some takeaways from your initialbecause now, I mean it's two years.
You still know what you shouldand shouldn't have done.
Yeah. And and we're still making mistakes.
I'm still making mistakes right now.
You know, so me and my partnerwere talking over this weekend about,
you know, things that we need toget better at. Yeah. And so
one thing that
I think we both regretwas the pace of growth.
(01:25:23):
I think we, I think we overredlined ourselves multiple times.
It was fun, but it was reckless.
I sort of feel like a moto GP racingmaybe just went a little too close,
maybe a little bit too much lean anglea couple times.
And it almost caused disaster multiple times.
(01:25:43):
Like if, if we hadn't
had relationship and community,
in the business community,in the industries that we were operating
in, and been known as,hey, these we're they're good dudes.
They're doing they're doing good work.They're not going to poach your people.
Anything like that. We got bailed outa couple times from from wreck.
So I'd say we we over overheatedthe engine twice, maybe three times.
(01:26:07):
And, you know, when you get a 200% growthrate in a single month or,
you know, a 40 day period,you got to watch out for that because
there's really no way to fund that,especially if you're undercapitalized.
Yeah, yeah.
Because and then you can't really predictper se how fast you're going to grow.
No. You know what I mean.
You can only just try to grow and thenall, you know, and that's what happened.
(01:26:28):
And then it was like, but even then,like we didn't throttle back
and maybe we should.The other thing I'd say is this.
While I've been
very successful at training new salesprofessionals, and,
you know, my partner has been very goodat building company culture, you know,
and we've been engaged doingthe things that we're asking people to do.
(01:26:50):
I think we need to do a better job
in the past and todayof training other leaders to come up
beside us and really empower themto take the next steps in their careers.
And so I think that'swhat we're focusing on right now.
Like, how do we trust more and how do we
how do we not do less, but sort ofmake ourselves a little bit smaller
but still be present?
Like, I don't want to be an absentee ownerat this point.
(01:27:11):
It's not it's not on the table.
But how do I how do I helppeople take their next step?
And, and in the process of doing that,how does that help our firm?
Because it's needed.
Like we've gotten to a sizewhere my my share will of of,
you know, what I think should happen
or my energy level or however muchI want to show up on a holiday and work
(01:27:31):
that's not going to drive usfrom 100 employees to 200.
That's not going to drop us from 70million a year in revenue to 150 million.
It's going to be a much bigger team.
And that team,
if I want to stay true to what the companyis, it needs to come from inside.
So I'd say those are the two thingsI would do differently.
I would slow down growth a little bit.
And the second thing is invest more timein training other people
(01:27:53):
how to do the higherlevel work, like help them like
even if it doesn't come with paylike they would like.
Your sales managers would love to managea vendor relationship.
Like they would love to do that, right?
Because they just start start giving themstart giving them challenges that
that enable them to be a little bitmore empowered as opposed to non.
(01:28:14):
Yeah, absolutely.
If they think it's just a job,you're going to get just job results.
Right.
And it's so that, you know and like I saideveryone uses the buzzword culture.
I get it and everyone uses it.
But I never ask, youknow, people to show up.
If we're not going to show up.
We take people to dinner.
We spend time with their familieslike that.
(01:28:35):
That is sort of.
But I understand that's not available at 3or 4000 employees,
but in our size, that's a lot.
What's happened to build the culture?
It's interesting, though,because the founder is typically one
like yourself who has a gung ho attitudeand and is a roll up the sleeves.
I'll do whatever it takes.
And that doesn't actually even get you towhatever level that you're talking about.
(01:28:58):
From 100 to 200.
No, it's not even that.
It's it's extremely strategic.
It's playing chess and not just checkers.
You know,you're looking at the big picture
and you're starting to implement,
you know, and also become moreof more of the leader and the visionary
as opposed to operational operations,operational professional.
(01:29:19):
You know what I mean?That's correct though.
And if you map that out and that'swhat we're doing right now, we're mapping.
Just like I said, we map 12 to 40,not 40 to 100.
The BPMs that we're drawing up todaylook nothing like the BPMs that got us
here, that these business processeslook very different.
There's going to bea little bit more management fee drag.
(01:29:40):
Our margins
need to be a little bit more efficientin other places to make up for it,
but that's okaybecause that's what it's going to take.
It's going to take usto be really intentional, map
the business processes, empowerother people to be leaders,
and then sort of orchestratethe whole thing
and lead and lead the whole thingfrom from the front.
But not necessarily, as a specialistare doing, doing the things
(01:30:03):
I've got one.
Well, probably like I'm surewe could probably banter for many, many.
Bauer's actually on this specific topicof growth, development, culture and scale.
But, can you share with us real quickthe technical
when you say map,what exactly do you do when you map?
And how do you set up a session?
(01:30:23):
That would be,that would be very valuable for somebody.
I know you say map,but maybe it's physically drawing ones.
Oh, it is, it is.
And, you know, it's business processmodeling or business process mapping.
Right.
Okay.
The those are the two termsthat I've seen and you seen used for it.
And to me it feels like an ERD.
That's an entity related designthat comes from the data world.
(01:30:45):
And so I told you, I'ma nerd, like my second loves data.
And so I got like it too.
Yeah.
So, you know, when you're talkingabout data architecture,
use these entity related designsto show how the different pieces of your,
your business intelligence systemis going to work together?
A single database going to be over here,and it's going to be, you know,
the symbol, and we're going to have our,our, our server over here.
(01:31:07):
And it's this symbol,
we're going to use this powerBI over here and Power Automate over here.
And you map it all out.And they all have symbols.
And so the business processmodeling is very similar to that.
Instead of just tech piecesit's all the pieces right.
And so you know you might have,you know, a symbol representing,
you know, a group of humansor an individual human, a team member.
You might have another symboloperating a computer structure
(01:31:29):
or a computer applicationor a web based application.
You might have a different onefor your CRM,
and your CRM is usually goingto have multiple aspects to it.
It's probably talking to other things.
Maybe you're using something codeless like Zapier,
or maybe you'reusing built in integrations,
but no one's using just like,you know, Salesforce Core, right?
You're going to have other things on it,
or, you know, whatever CRM you're using,if you're using something different,
(01:31:50):
you built something.
So when I talk about mapping,
how big are our sales teams going to be?
What's that look like? Map like? Okay.
Do we have one leader here.
And they're responsible for everythingthe time and attendance.
Culture and sales trainingand or do we have a second coach,
like a performance coachthat focuses on sales.
Know what to do, and thenwhere does that information flow to
(01:32:12):
and how does it how does it comeinto your progressive discipline policy?
Does it flow into like, sort of HRpeople, team center that then enforces
progressive disciplineor your manager's doing that.
And while they soundlike abstract questions
that maybe aren't important to your teamat 15 employees or 40 employees,
without that processmapped and implemented effectively,
(01:32:33):
managing 150 or 100 people is unwieldy.
And it's uncontrollable. Yes. Right.
And so you have to have things like thisset up ahead of time, right.
What's the relationshipbetween our openers and our closers
and what's that mapping look like?
And when what happens when our managershave disagreements between
sales teamsor between our leaders and our closers.
And that needs to be mappedout of the decisions get made.
(01:32:55):
How do they get arbitrated?
And so right now, we're in the processof physically drawing out the maps
of how we have to gofrom where we are today
to something that can support250 employees.
That's our target is 250 on this nextquarter, have they created an eye map tool
for business systems creation?
Oh, that'd be cool.
Yeah, that'd be cool. Yeah.
(01:33:16):
Right now I you saw my dry.
There's a few tools,but none of them are, like,
none of them are making recommendations.
There's no autofill yet. Them.
Yeah. That's interesting.
Yeah.
Because we're seeinga lot of advancements in AI, and I'm.
I just been obviously interviewinga bunch of people that are buying
and selling companies and creatingefficiencies within organizations.
(01:33:36):
And I'm like, wait a second,is this another entry point?
Yeah, could be a technology.
Could this be the light bulb?
Yeah, yeah.
And is that a product? Yeah, absolutely.
Well, look, again,we could probably talk for hours and,
you know, we do a really appreciateyou coming on the acquisition
IQ podcast as well as helping to build thethe entire network as a founding member.
(01:33:58):
So for that, we thank you.
We are excited to have you.
I don't know if you have committed fullyor if you'd like to be a part of the Aqua
Con conference.
But guys, ladies and gentlemen, out there,if you guys have haven't heard
or if you have heard, Aqua Con is comingto Salt Lake City on September 3rd, 2025.
It's going to be great.
(01:34:19):
I'll be there. Well, and it will.
And how we've structuredthe room, it's very curated.
So individuals just like, Chris here
will be seated at eight peopleper round table.
And as far as that round tablegoes, we'll have about 300 individuals
at this conference.
We'll talk about fund creation andhow you can develop your investment fund.
(01:34:40):
Then we'll move onto how you can acquire companies.
And then leveraging financial,you know, like you,
for example,you leveraged debt for a little while
and then we've got private equity, familyoffice, venture capital, or you have,
you know, a high net worth individualfor that capital stack.
And then movingon, we've got our sell side panel,
(01:35:00):
which we'll discuss, obviouslyprepping for sale, making sure
that we have maximal value upon your exit
and really just an overall experiencethat the operator of a company,
an M&A service provider or a seasoned
investor would have a great timemeeting with people
like Chris, are meeting with othersthat can speak the same language
(01:35:23):
that's been there, done that.
So that's whatwe're developing at Aqua Con.
We would look forward to having you guysthere as well.
If you like today's episodeon the acquisition IQ podcast,
feel free to like and subscribeon our YouTube channel.
And then also send thisto your founding friends who are scaling
their companies that have sales teamsthat have, you know, various systems
(01:35:46):
that need to be mapped out,like what we discussed earlier today.
And then just loves data, you know?
So anyway,thanks a lot, Chris, for joining us.
This.
And we look forward to making more podcasts just like this for you guys out there.