Welcome to the Inside BS Show. My name is Dave Lorenzo. I'm the Godfather of Growth.

We are with you every day, 6 a.m. on the podcast. If you wanna join us on LinkedIn, 11 a.m. on LinkedIn Live, that's where we're gonna be right now. As we work things out on LinkedIn Live, that schedule may change, but if you're listening and watching, 11 a.m. every day on LinkedIn Live.

So, putting on my glasses, I've got questions. I got five questions from our subscribers. So, if you wanna ask me questions, or you wanna ask Nicola, you wanna ask Nikki G questions, you gotta be subscribed.

Getinsidebs.com. You've heard me say that before, getinsidebs.com. If you're a subscriber, when you get the daily email, you got a question for us, reply to that email. We read them all. I love your emails.

Okay, question number one. Why is the name of your company Exit Success Lab when you're really focused on growth? Okay, excellent question. This is an excellent question.

So, the name of the company, Exit Success Lab, okay? Here's the reason why we named the company Exit Success Lab. This came about, I was doing talks with CEOs. I was doing talks for Vistage, which is a CEO coaching organization.

And I would start every half day seminar that I did with the question, how is this business going to end for you? So, think about that for a minute. How is your business going to end? Here's the thing. You don't have an answer to that question, right? Most people don't.

They're going through their business, they're basically doing the, they're going through the motions in their business every day, and they don't have an end in mind. So, think about getting in your car and driving. Every time you get in your car, you're driving somewhere.

You have a destination in mind. If you've never been there before, or you're not sure what the best route is, you pick up your phone and you enter the address into a GPS app, and it gives you a map. It gives you some directions for how you can get to your destination.

Nicola and I have found that business owners don't know what their destination is. And if they don't know what their destination is, they're not going anywhere. So, you're just going through the motions on a day-to-day basis, and that's not productive.

That's not gonna work for you. So, we named our business so that we could focus the business owners on the destination where they were going. Now, one group of the people who work with us have an opportunity to sell their business in five or 10 years, and they're focused on that.

Other businesses that we work with, they have no desire to sell. Most of these are family-owned businesses. They wanna pass the business from generation to generation.

That doesn't mean that they don't set a plan. That doesn't mean that they shouldn't set a plan for running their business. They absolutely need a plan for running their business as well.

So, Exit Success Lab is focused on helping business owners move toward a destination that is appropriate for them and their business. Now, why do we focus on growth? The number one thing that people buy when they buy a business is they buy future revenue. If your business isn't growing, it's dying.

There's only two options. It's a zero or a one. You're either growing or you're dying because if you're not growing, the business is gonna decay.

Inflation grows. If you don't grow the business to outpace inflation, you're gonna make less money, right? So, your business has to constantly grow. One of the things that we found is businesses don't have plans for predictable, sustainable revenue growth.

So, we spend a lot of time focusing on business growth. The other thing we found is that most family-owned businesses are not sellable because they don't have systems and processes in place that will make their growth predictable. So, in order to have a business that you can pass down to the next generation or in order to have a business that you can eventually sell, you gotta be focused on growth.

So, that's why we spend so much time working on growth. If you have a predictable growth system in your business and you want to improve the overall business value, we can work with you there, too. And that gets us to question number two.

Question number two is, Dave, I noticed you've changed your focus and your language to be, well, this is written wrong, but you've changed your language to focus on profit rather than revenue growth. Why profit versus revenue? Businesses are valued based on the profit they're going to produce. Nobody cares what your revenue is if you don't have enough profit going to the bottom line.

I'll give you an example. I met with a business owner a few weeks ago and they're in the consumer space. They have a consumer-driven business.

They sell a product. The product that they sell is expensive to acquire and then they market up and they sell it. The business is doing, let's say for argument's sake, I'm gonna change the numbers so that we can identify them.

Business is doing five million in revenue but taking only 275, $275,000 to the bottom line. Now, the business is paying three family members, it's paying five other salaried employees and because it's a family-owned business, they're running some expenses through the business that the IRS would probably not be thrilled with. So they're living a very nice life and the business is showing $275,000 in profit on $5 million in annual revenue.

If they were to go to sell that business, they would back out some of the stuff and let's say that 275 becomes half a million dollars and it's five million in revenue so they're essentially doing 10% profit. They're not gonna get a lot of money for that business. They may get 2.5 million in annual revenue, I'm sorry, they may get a multiple of 2.5 million for that business.

They may get a lump sum of 2.5 million which would be a five times multiple for that business. It's a five times multiple of, let's say that profit was EBITDA, earnings before interest tax depreciation and amortization. Let's say they get a five times multiple and they're doing 500,000 in profit after they take out all the expenses they're sandbagging in there.

That's not a lot of money on $6 million worth of revenue. They're not gonna be happy with that. I wanna come in and find new ways to enhance that profit and I have several ideas for how to do that.

If I can take that profit and grow it from half a million dollars to a million dollars and they get that five times multiple, look at the difference in what they walk away with if they go to sell their business. So if I take that half a million dollars and I double it for them and they get a million dollars and they still get a five multiple, now they're getting $5 million in money for their business versus two and a half. It's different, it's life changing, it's double.

Profit is everything in your business and candidly, there are lots of ways to grow revenue. Growing profit is what takes the real skill and the real insight and when you're focused on profit, you tend to focus on different types of clients. You'll find different types of clients for your business when you're focused on profit.

All right, question number three. How does Exit Success Lab work with people? All right, so I'm not doing a good job of explaining what our business model is so let me do it for you here in two minutes or less. We work with people in three different ways.

First and foremost, Nicola and I lead a community of business owners called Our Masters Program. These are people whose businesses are doing $5 million or more each year and we initially focused on $5 million in revenue. So let's call it $5 million or more in annual revenue.

We're teaching them how to develop businesses that are independent of them, businesses that can be sold, businesses that have value, okay? We work with these people by meeting with them on a quarterly basis in person for two days. We teach them some skills, some knowledge, and then they select a goal and they work on that goal for the next 90 days, they come back to us and present the results of the work that they've done. We hold them accountable by hosting private meetings with them each month and we host a workshop with them each month so that they meet with us two times each month, once as a group, once individually, and then in person each quarter.

This keeps these people accountable and it unlocks the growth potential in their business. This is the best program of its kind and it is the only program that actually holds a business owner accountable for driving growth. That's the first way we work with people.

Second way we work with people is we have a consulting business where if you want to sell your company in the next, say, three years, we will help you improve the value of your company so that when you go to market, you can sell your company for more money and to enable the lifestyle you deserve. We treat the company as a completely separate entity. So if your financial advisor is telling you you need $5 million for retirement but your company is worth 20, you're not gonna sell your company for 5 million.

As consultants, we come in and tell you exactly what to do to improve the value of your business. I'm not a financial advisor who's here looking to manage your assets after you sell your business. My concern is to get the maximum dollar for your business and I wanna work with you three to five years in advance to do that.

If you're within 18 months and you wanna sell your business, I can help you there, but my goal is to make your business more valuable so you can sell it. That's the second way we work with people. Third way we work with people, if you're a professional service provider and you want to work with business owners who are interested in improving their value, we will help you.

We will bring you to those consulting engagements, we will introduce you to our clients, but first you have to go through our certification program and it's gonna take you a year to do that. And here's the reason why we do this. Quite frankly, if we let you into our community and introduce you to business owners right away, you could get three or four clients and then go off and work with those clients and never do anything with us again.

And that's not what we're looking for. We're looking for long-term relationships. So we certify you on our system so we know you're a legitimate person and you want to help our clients and you speak our language.

So professionals, if you're interested in joining our community, you can contact Nicola. Best thing to do, go to getinsidebs.com, sign up for our daily emails, and if you're interested in joining our community, reply to the email you get each day. We'll bring you on board and we'll certify you and then we will introduce you to business owners that you can help.

So those are the three ways that we work with people. If you're interested, reach out to us. We'd love to talk to you.

Why family businesses? I see you, you're working with family businesses. Why family businesses? Well, almost every business starts out as a family business and Nicola's background is she grew up in a family business. So family businesses are natural for us.

If your business isn't doing $5 million a year yet and you want to work with us, we have a monthly seminar we conduct for businesses that are doing less than five million and that's our family business seminar. So we take all businesses that are doing less than five million in revenue and we lump them into the family business context. Even if the business is owned by two partners, it's fine.

You can come to that family business seminar we do every month and we'll help you grow. We'll help you that way. So we call businesses that are doing below five million family businesses, whether they're owned and operated by families or not, but most of them have family members that are involved.

So that's why you hear us talk about family businesses. Last question I have here on the list today is, Dave, I see you work with family offices and you run a high net worth group. What do you do with family offices? Okay, so family offices are just companies.

They're like holding companies and they're holding companies designed to manage wealth that a family owns or has created. So they serve as a way to work on their investments as well as a screening tool, a screening mechanism for everyone, whether they're professional service providers or home service providers. Everyone who works with the family will then go through the family office as a screening mechanism.

It's also a great opportunity for them to get involved in other investments. Why do we work with family offices? Number one, family offices are the next generation of private equity. They're looking to invest in businesses.

I work with business owners. So oftentimes when a business owner wants to sell, we can sell the business to a family office as an investment, right? Second thing we can do is when that business owner sells, if he or she realizes $100 million or more, they're gonna need a vehicle to manage that wealth and to keep the people at bay who are looking to take the money from them. So they're gonna need to get into a family office.

And we wanna be the ones to help set that up and to provide them with the resources. We also have a cadre of professionals in Exit Success Lab that can help families of wealth. So family offices are a great way for us to help them.

So yes, we work with family offices. Yes, we help set up family offices. Yes, we help hire family office managers.

And yes, we bring professionals to family offices to help them. So those are the five questions that I've received today. I'm doing these questions today because I've got, these questions just came in this week alone.

This is a Saturday show. So I thank you for joining us here on the Inside BS show. Hopefully you learned something.

Hopefully this was valuable to you. If you want to connect with us and you wanna ask questions every week, go to getinsidebs.com. Getinsidebs.com. Get our daily email. That daily email will be your ticket to get into our family business event where we teach family businesses how to grow, how to increase profit.

I'm Dave Lorenzo. I'll be back here on the Inside BS show tomorrow at 6 a.m. And don't forget to join us on LinkedIn Live at 11. Until tomorrow, I'm hoping you make a great living and live a great life.