In The Trenches

This episode is brought to you by ⁠⁠⁠⁠⁠⁠Boulay, the industry standard for Quality of Earnings, tax, and audit services, serving search fund entrepreneurs for 20+ years⁠⁠⁠⁠⁠⁠ [https://boulaygroup.com/trenches/] * This episode is brought to you by ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Oberle Risk Strategies⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠: Insurance Broker and Insurance Due Diligence Provider for Search Funds and Other Small-to-Medium-Sized Businesses⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ [https://oberle-risk.com/in-the-trenches/]     *   My guest today is Collin Hathaway, the Founder of Skylight Capital, a micro-cap private equity firm that invests primarily within the home services ecosystem. Collin got his start as an entrepreneur after acquiring a small plumbing company at the outset of the great financial crisis in 2008. Since then, he has acquired and operated several other home services companies operating within the plumbing, HVAC, and roofing verticals, to name just a few. In our conversation today, we cover how the home services market has evolved since he first entered it in 2008, his views on organic versus inorganic growth theses within home services, whether the market is too competitive today, what he’s learned about the art (and science) of raising money, how he communicates bad news to investors, and what he learned from experiencing a heart attack at only 36 years old.

This episode is brought to you by ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Oberle Risk Strategies⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠: Insurance Broker and Insurance Due Diligence Provider for Search Funds and Other Small-to-Medium-Sized Businesses⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ [https://oberle-risk.com/in-the-trenches/]     * This episode is brought to you by ⁠⁠⁠B⁠⁠⁠oulay, the industry standard for Quality of Earnings, tax, and audit services, serving search fund entrepreneurs for 20+ years⁠⁠⁠⁠⁠⁠ [https://boulaygroup.com/trenches/] * When evaluating a small business to acquire, to suggest that some form of concentration is common is likely an understatement. Indeed, in most cases, concentration of some variety is a borderline inevitability. Though this often takes the form of customer concentration (the focus of this blog post), it can take other forms as well, including key person concentration, supplier concentration, reseller concentration, and technology/platform concentration, among other forms. The aim of this blog post is to discuss when customer concentration is acceptable (and when it is not), how to incorporate its associated risks into the transaction’s price and structure, how to diligence the likelihood of those risks manifesting, and the types of business models where the defection of large customers should be viewed as an expectation, and not as an improbable risk.

This episode is brought to you by ⁠⁠⁠⁠⁠Boulay, the industry standard for Quality of Earnings, tax, and audit services, serving search fund entrepreneurs for 20+ years⁠⁠⁠⁠⁠ [https://boulaygroup.com/trenches/] * This episode is brought to you by ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Oberle Risk Strategies⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠: Insurance Broker and Insurance Due Diligence Provider for Search Funds and Other Small-to-Medium-Sized Businesses⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ [https://oberle-risk.com/in-the-trenches/]     *   Today's guest, John Ratliff, is a lifelong entrepreneur who founded a call center company called Apple Tree Answers, which he scaled through 24 separate bolt-on acquisitions, growing it over 3,000% prior to selling to a strategic buyer in 2012. He then went on to become a partner at an investment bank, where he has advised on countless small business transactions. All told, he has sat in nearly every seat at the M&A table — as a founder, buyer, seller, and now advisor. In our conversation today, we cover: * How he reduced frontline turnover from 115% annually to 18% annually * Lessons from acquiring 24 companies, including what he did differently in deals 23 & 24 relative to deals 1 & 2 * How John stayed intimately connected to 650 employees across 24 locations * How he designed himself out of the day-to-day operations, spending just 15–25 hours per week inside of his business * How to spot real sellers, how to navigate the notoriously tricky transition between incoming & outgoing CEOs, and how to identify red flags in due diligence Please enjoy!

This episode is brought to you by ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Oberle Risk Strategies⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠: Insurance Broker and Insurance Due Diligence Provider for Search Funds and Other Small-to-Medium-Sized Businesses⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ [https://oberle-risk.com/in-the-trenches/]     * This episode is brought to you by ⁠⁠⁠B⁠⁠oulay, the industry standard for Quality of Earnings, tax, and audit services, serving search fund entrepreneurs for 20+ years⁠⁠⁠⁠⁠ [https://boulaygroup.com/trenches/] * If you have ever had to decide how to price a product or a service, or if you foresee yourself having to make such a decision one day, I implore you to listen to today’s episode, in no small part because of how many practical takeaways you’re likely to leave with. I’m joined today by Casey Brown [https://www.linkedin.com/in/caseybrownboost/], the founder of Boost Pricing [https://boostpricing.com/], a consulting company that helps their clients with all things pricing, including not just setting prices, but also the often overlooked tactical details of how to actually go about executing on pricing changes. In addition to being the Founder of Boost pricing, Casey is also a prominent keynote speaker, having delivered a TEDx talk in 2015 [https://www.ted.com/talks/casey_brown_know_your_worth_and_then_ask_for_it?language=en] with over 5 million views to-date. She has degrees in both Chemical Engineering and Business, and if you listen to our conversation today, you won’t be surprised to hear that Casey cares about three primary things when it comes to her clients: Being fearless about price increases, getting paid what they’re worth, and increasing profitability fast.

This episode is brought to you by ⁠⁠⁠⁠Boulay, the industry standard for Quality of Earnings, tax, and audit services, serving search fund entrepreneurs for 20+ years⁠⁠⁠⁠ [https://boulaygroup.com/trenches/] * This episode is brought to you by ⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠Oberle Risk Strategies⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠: Insurance Broker and Insurance Due Diligence Provider for Search Funds and Other Small-to-Medium-Sized Businesses⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ [https://oberle-risk.com/in-the-trenches/]     *   This week, I'm joined by Dr. Sherry Walling, a clinical psychologist, speaker, podcaster, and best-selling author. She is also the Founder of ZenFounder, which aims to help entrepreneurs and CEOs navigate issues of transition, rapid growth, loss, and any manner of complex human experience. She is also the host of the ZenFounder podcast, which has been called a “must listen” by both Forbes and Entrepreneur Magazine and has been downloaded more than 1M+ times. Sherry first came onto my radar when she published her first book, the aptly named The Entrepreneur’s Guide to Keeping Your Sh*t Together, which discusses many of the topics that we’ve explored over the years in this podcast related to managing your psychology as an entrepreneur and CEO. Her most recent book is titled Exit Strategy: The Entrepreneur’s Guide to Selling Your Business without Regret, which goes beyond purely commercial considerations, and explores the largely unexplored personal considerations specific to the largest transaction of most entrepreneurs’ lives.