Jeff: Welcome to Deal Talk by Morgan & Westfield, I'm Jeff Allen. If you're a business owner, entrepreneur, or investor this is the place to be. Our mission is to educate and inform you with the help of some of the most credible, highly-regarded experts in the industry of transacting businesses so you'll be equipped with the knowledge to help you make some important decisions when the time comes to sell your business or buy one for that matter.
When was the last time you told a story? Can you spin a good yarn? I'm not talking about a bedtime story or a clever anecdote, but an honest to goodness true story about yourself, about your business. The reason I bring this up is because my guest on this edition on Deal Talk believes it's important for you to communicate your story, particularly when you're positioning your business for sale, whether that's ten months from now, ten years from now, or further down the line. His name is John Chang and he's CEO or a Chief Pilot as he calls himself at Bush Pilot Marketing in Los Angeles. John Chang, welcome to Deal Talk, it's good to have you.
John: Thanks Jeff, it's good to be here.
Jeff: John, to kick things off maybe you could tell us your story if you could. Give us a sense of your background, how you help business owners, who you are.
John: Well Jeff as we've mentioned before that my thing is that I've always been a fan of entrepreneurs since I was a kid. And growing up I just admire folks just different times for their different pursuits of freedom, their passion, and the businesses that they created. What I noticed over time is that as I start to work with different entrepreneurs, often they had a hard time getting the knowledge and the understanding of the other aspects of businesses that they need to know - things like selling their business. It's rare that the entrepreneur has any idea what's involved with that. For a while I was working as a business broker and helping them do that but then I realized that as I started to work with them, I needed to work with them earlier stage. At that point there wasn't much I could do as a business broker to advise them because too often things that they have set in motion at that point were pretty much limited to what can be corrected at that point. Now, that's why I started Bush Pilot Marketing as a way to basically work with different entrepreneurs, different startups, and different businesses earlier stage to prepare themselves for that one day.
I've always been a fan of entrepreneurs since I was a kid. And growing up I just admire folks just different times for their different pursuits of freedom, their passion, and the businesses that they created.
Jeff: Have you found, John, that the business owners that you work with or that you approach, maybe it's just a conversation you have in an elevator, might somewhat resistant to the idea of preparing their business for sale, any resistance at all that you picked up from people that you talked to about, hey, I'm not interested in selling my business John, why should we talk about this?
John: Yeah, if anything, business owners especially in the different times of the growth stage and stuff there are so many different things they had to do. They have to deal with marketing, they have to deal with different types of payroll, and they have to deal with different types... Just juggling all that day-to-day that the last thing they're going to be thinking about is preparing for that one day. They're still worried about today. They're not thinking about that someday. That eventual point that they may decide to make a change. That's the biggest tragedy to me is because when it comes to that one day their business then is not equipped to basically pay them back for all their services to their customers, to all the things that they've done to grow their business. That's one of the reasons why I realize I need to start talking to folks earlier stage. And that's one of the things that I really admire about your show and appreciate through your mission is that I feel that this is so key to get this word out to these entrepreneurs, these folks who put their heart and souls into these businesses. Because they're doing so much good in the world but yet when it comes down to it there's usually not, the business is ready for them to finally pay them back for all the hard work.
Jeff: You're kind my friend. Thank you so much for the recognition. I read a blog that you wrote recently for LinkedIn and it was titled Sell Your Story Before Selling Your Business. You mentioned that far too often business owners make some of the same mistakes when the try to sell their businesses. What did you mean by that? Share with our listeners what those mistakes are that you kind of witnessed in the past.
John: Definitely. The number one thing is that even though these owners are skilled at selling their part of the service that by the time that here we are at the most critical sale of their lives selling their business, they're just in their own way. And when I say that I'm not being facetious, I'm talking about the different times... It's a thing of where there's so much in the business that they can't step away from it to look at it as at this point this is their product or service that they're selling, the ultimate one, which is selling their business. Because of that, that's where they're either too involved with things like pricing the business, they're too involved with what they think is valuable. I've worked with owners at the time who were focused on selling different parts of the business that for a buyer they just weren't interested in. There was a pet business that was just in that situation where they would try to sell all these little critters and stuff like that. And most buyers were not interested in owning a business where they had to deal with animals and raising them. For that example I basically stepped back and say, "What are the different sources of revenue?" And it turned out that 20% of the revenue provided 80% of the net profits. And that was the aspect that he did not focus on and we kind of tailored our marketing and the plan to sell it based on that instead. Again, it's just different times. The owners themselves need to be able to step out or find an adviser who can help them step out of the business and look at it from a whole as that is a product or service that you're selling, it's the business itself.
That's simply another aspect of it too is that it's the thing of different times, the folks who are really good at starting businesses aren't necessarily the ones that are the best ones to be the owners/managers.
Jeff: So the old adage not being able to see the forest through the trees, simply too close to things to be able to get the perspective that one needs in order to make some really vital decisions that could help them potentially even increase the value of their business. Is there any truth to the statement John that all entrepreneurs are business owners, but not all business owners are entrepreneurs? Am I making sense there? Is that just something that's kind of a pie in the sky, a random rant of a podcast host?
John: That's simply another aspect of it too is that it's the thing of different times, the folks who are really good at starting businesses aren't necessarily the ones that are the best ones to be the owners/managers. That's a thing that different times come into play further down the road as well. For example if it comes to that stage where the business needs to be sold, that entrepreneur may have been great at just getting everything set-up and stuff like that. But now it's a different discipline to kind of grow the business, to make it a mature... Again, something, the energy that these buyers can be interested in. That's absolutely another key aspect of all this.
Jeff: For people who are just listening over someone else's shoulder perhaps a colleague there in the office, or wherever you may be, I'm talking with John Chang, he is the Chief Pilot at Bush Pilot Marketing in Los Angeles. You're listening to Deal Talk, my name is Jeff Allen, good to have you on board. John we're talking about telling a story and why telling that story's important, and that business owners should plan to tell that story or consider telling their story as a way to prepare their business for sale, or they do that in the process of selling their business. At some point there needs to be a story attached to them. Tell us exactly what you mean by this story? Why is it so important that a business owner kind of step outside of himself and present his story to the world or to those folks certainly who have an interest in his or her business down the line? Why is it important? Why is it important? Why do we need to do that?
John: Well Jeff, as you and I connected, it was basically when you invited me to the show, I looked at what was your mission. That in itself, the story of why you are doing this podcast resonated with me. And from there the logistics, the planning all became easy. That's one of the things that Simon Sinek tells us about is the importance to go buying your why before buying your what. And that's the thing that when I look back at the different times that deals fell apart, the different problems came up there was always something wrong with matching the why's and the reasons and the story between the buyer and the seller. That's a thing that I look at different times is what is the why of the business and getting down to it because that's often the story that will really resonate with folks that are interested in buying the business.
Jeff: But there are those business owners John who may not exactly know how to tell their story or maybe their subconscious about it. They don't communicate well or feel that they can't communicate well enough for people to understand why it is that they do what they do. They may have a like, "I want to be successful. I want to support my family. I want to make sure that I leave my family well-prepared in case of... Or I'm following my dream." How do you work with people like that who may not be very good at communicating their story or even know how to do it for that matter?
John: Absolutely. The thing there is just basically listening. And for me as an advice of different times I will simply sit down with them and ask them the questions that will prompt them to tell the story. The more folks feel comfortable talking, the more they're willing to share. And that's the thing about the whole process of working with someone is allowing them to basically share what matters to them. And anytime you have that, whether it's through your business or through social media, it's basically that aspect of having this conversation, creating the space of allowing the person to basically share their story. That's the number one thing. Whether you're doing it for selling your business or you're doing marketing, or social media, they're all aspects of the same thing, of allowing the same folks to have the space basically to share more of what they're really all about.
Jeff: And this goes back to I think a quote that I saw from you and that was basically, "You must be clear on your why before others buy your what", correct?
That's the number one thing. Whether you're doing it for selling your business or you're doing marketing, or social media, they're all aspects of the same thing, of allowing the same folks to have the space basically to share more of what they're really all about.
Jeff: Let's talk about something else that you said - that it's okay to be creative with your story. What do you mean by that? Are you talking about sometimes there might be a need to kind of maybe embellish a little bit or I don't think you mean exaggerate to the point of being untruthful. But need to maybe create some real interest there to make people sit in the front of the seat saying, "Wait a minute, this is something that you've really done and this is what really happened?" Just kind of fill us in a little bit about what you mean by being creative with your story.
John: I think it's left-over from the Madison Avenue days that folks joke about being creative with the numbers. And that's exactly what you said, it's not the kind of story-telling I'm talking about. I'm actually talking about the exact opposite. I'm talking about being in complete alignment with what you're really sending out to the world and what you core why is really about. That alignment is really not only going to attract the ideal buyer and is going to make things a lot easier, it's also going to achieve this win-win for everyone. As I mentioned in the article with the couple that I was working with not only was that the smoothest due diligence crew that I've seen, the new owners now become even more successful, he's been very happy with the purchase and stuff. And again, that was because I knew from the moment I sat down with a couple that everyone was in alignment of what the story was about. There was no fudging the numbers, there was no making things up, it was basically this alignment, is this the real essence of creativity. Because when we talk about creativity typically and the sense that it's become kind of side tracked it's about making things up. But creativity to me is really about aligning with this deeper sense about what you're about and then bringing it out to the world. That to me is ultimately creativity.
Jeff: John, you are alluding to a couple in the column or the blog post that I mentioned at the top of the show from LinkedIn. And what I like you to do is I'd like you to add a little clarity to that and fill us in maybe on some of the details about that particular story, who these people were that maybe the kind of business that they have. We don't need to drop any names or anything like that. But if you could share us some of that stuff when we return from the break it would be kind of nice to hear a real life story where you had a chance to work with a couple who were in the throes of selling their business and why you were able to use their story to help them. And I'd like to do that when we come back here in just a moment. You're listening to Deal Talk. My name is Jeff Allen and I'm talking with John Chang, business adviser and CEO of Bush Pilot Marketing in Los Angeles. And we'll continue our conversation on why telling your story is important particularly when you're selling your business, after this.
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Jeff: Welcome back to Deal Talk. I'm Jeff Allen with my guest, business adviser and story-teller extraordinaire, Mr. John Chang of Bush Pilot Marketing. John, we were talking just before the break. You were mentioning a recent example of business owners who were selling their business and you had a chance to talk to them a little bit about why they wanted to sell their business but what was something that was really passionate to them that was leading them to this decision to move away from their business and get into something else. I was hoping that maybe you could kind of relay the story and maybe a little bit more detail from the beginning so that our listeners have kind of a sense of what it is that you're talking about. And they'll be able to capture this illustration about why it's important to tell your story. And you've got this really interesting story yourself to relay. So if you wouldn't mind that would be great.
John: Sure thing Jeff. What happened was this couple came to me and basically they're trying to sell their business themselves. I knew from just the basic numbers that they were selling way too low. And the reason why they had lowered the price again and again was because they were really desperate to get the business sold. Normally with the business it's only been... As you know, folks that have only been in business for a couple of years, that's one of the hardest deals to help along. And the thing was though that we had to really get down to the story. Why were they so interested and such in need of selling their business? It turned out that they wanted to get into ministry work. This was a couple that they were very passionate about ministering to youth and to other folks, and they just decided that the business they started was just not going to allow them the time to do that. The thing was when they told me that story that resonated with me not because I wanted to be involved in the ministry myself but because I understood their why. And having that story allow me to not only shape it as a deal for folks that were potentially interested, again, not because I was looking for Christian buyers or anything like that but because people understood different times that, that was why they were interested in selling their business. Not because it was a business in trouble, not because it was a business that was losing money, it was just simply a situation that people could really resonate with. Here was a couple that were honestly goodness looking to basically take their passion and put it into another mission. With that we allow them to not only double what they were trying to get on their own but we attracted an ideal buyer that ultimately... This was a young guy who's very motivated, very much willing to put the work to grow the business. In fact that's exactly what happened. After he purchased the business he again doubled to me what was the value of the business. That's a perfect example of where your story not only will attract the right buyers and create the right deal, it's just ultimately a win-win for everybody.
Jeff: It really is a great story and an inspirational story at that because these were folks who obviously had other interest that were kind of in the background but to them John obviously these were important interests and they wanted to go ahead and pursue those. And so you certainly can't fault them for that. Their business they felt was not allowing them to do something that was really, really important to them. And as it turns out what was important to them was giving back. That's something I think that everybody can really testify. It's something that we've all kind of thought about at one point or another. How do we do that and how do we find the time to do that? Sometimes selling your business is the only way to do that.
That aside, there are people listening who might be thinking, "You know, what John is saying makes perfect sense." And this is something I think that you talked about a little earlier that Madison Avenue, the advertising gurus back particularly in the old days, and now even we're starting to see this again. I talked about appealing to the emotions and talked about telling that story. It's not the product itself it's the feeling that you get when you have that product. It's something that comes from the heart and selling yourself certainly does do that. How does a business owner start or an entrepreneur start the process of coming up with their story, telling it? Maybe they feel like they need some help to tell their story because they're not sure how they can tell it effectively. But they can certainly begin to craft that story on their own or put those thoughts into motion, put them on paper. But how do they start that when they're so used to just the day-to-day running and managing their business?
John: Well, one the things that I like to do with business is just basically take the time aside. That could be any number of ways. It could be basically if I'm working with them remotely, it's just basically saying, "Listen, let's set aside the time to talk about what your business is about." And from there we get drilled down to it and start allowing them to share their stories. Allow them to again, create that space that allows them to have the right mindset because that's really what all this is. Like so much of business we're focused on hard numbers, tactics, and all these kinds of things. But really sometimes we have to develop a certain mindset, a certain way to step outside of our business. Step outside of our day-to-day that just basically allow ourselves the space to come up with the core story, identifying what it is that really matters to us, and what it is that is our why. And that's the thing, unless you allow that space it's just really, again, the situation where we get in our way. It's a lot harder. Basically, we're more focused on the day-to-day and the things that we feel like we have to do. And that hurry, that rush mindset will not allow you the ability to come up with the things that really matter.
Well, one the things that I like to do with business is just basically take the time aside. That could be any number of ways. It could be basically if I'm working with them remotely, it's just basically saying, "Listen, let's set aside the time to talk about what your business is about." And from there we get drilled down to it and start allowing them to share their stories.
Jeff: I've always kind of thought, it's not fair for someone to come up to me and ask me what do I like to do? What are some of my hobbies and stuff like that. Because sometimes quite frankly John outside of what I do, and I’ve got a couple of different things that I do in my career and my profession. I sometimes have trouble coming up with those hobbies and leisure types of things that people really want to talk about. Because for whatever reason maybe they can make more time in their lives for those fun and recreational types of activities. But as far as telling the why of your story I would imagine that it's not always easy because these are the types of stories that take a long time to put together, and a lot of careful thought and consideration that doesn't always happen over an hour, 2 hours, or 3 hours of sitting down over several cups of coffee to come up with an idea.
John: Yeah, that's the other aspect as well is that you can't rush things along. Although there are ways to bring it out as quickly as possible but it's just that same idea of you sit there and drown the plant with water or you blast it with more sun, it's not going to grow any faster. So you have to, again, allow the space and allow the time to nurture it. To basically allow it to come out in its own time even though the better you nurture it, the better you provide, the different things it needs, the faster it'll produce fruit. That's the other aspect about all of this, is just basically finding that right balance between providing the nurturing and the care that it needs to bring it out as quickly as possible. But not trying to blast it and douse it with the different things that you think it needs.
Jeff: John, playing devil's advocate, and John Chang by the way is with Bush Pilot Marketing in Los Angeles in case you're just listening in. Just playing devil's advocate here John, what you're saying is it's good stuff, it's interesting, and it's thought provoking. But really John at the end of the day I've got a company here that I know has value and I know that there's some competition out there. But I believe that I've got a business that is going to really sell itself. I just need to get myself some time on that. Why do I really need to go and do all of this stuff. You're actually trying to tell me through a story that you relayed about working with a couple in the past, that you were able to get them more money for their business than they had originally considered or had offered their business for. Is this really true? This stuff can't really work, can it?
John: I could tell you that just never mind for selling a business but it's the same thing now in this very crowded online, marketing, social media world that we live in is that there's so much noise. And we're so bombarded with different things of the same "buy here, learn more about this" that in the end what's going to catch our attention is the story. That's the thing that's going to resonate. Somewhere out there is someone that really is going to resonate not only with the story of your business. But just even right now this podcast I feel that I'm talking to Dave Sr. - he's somebody who I work with the in the past that unfortunately is somebody who passed away a while ago. But that's someone who that when I'm talking right now, that's who I feel like I'm talking with is because of that person that I really resonated with and connecting with and stuff. Somewhere out there there's another Dave Sr. who really needs my advice, who really will understand what it is that I'm advising. And that's going to be who I'm going to connect with. And that's the same thing. When you're selling your business or when you're selling your product or services and stuff that when you have this story that connects with that individual, that's how you're going to standout above all these noises in the online world and just day-to-day that's right now making it so much harder for businesses to standout.
Jeff: Okay, let's go ahead then as we start to run out of time here John. I want to give folks the opportunity to hear from you a couple of real key takeaways. If they do nothing else today other than take 5 minutes over a cup of coffee or whatever to think about their business and to think about when they may be interested in selling it down the line. What are some of the key takeaways from our conversation today that you think are important with regard to planning that business for sale and how selling your story is just as important as selling the bricks, mortars and assets of your business?
John: Absolutely. More than likely, the folks got to their business because of the passion that they had for what they did and their yearning for freedom. That why and conveying that, is much stronger for selling their product and service. And then ultimately when it comes time to sell their business, when they communicate that story, that why, that's going to be much stronger and much more powerful than any numbers or any data that you can possibly come up with. And so that's the thing that why I can't stress enough the importance of people buying your why before they buy your what in selling a business.
More than likely, the folks got to their business because of the passion that they had for what they did and their yearning for freedom.
Jeff: There you go. John, if folks have an interest in reaching out to you to get more information, or to find out how you might be able to help them, how can they reach you?
John: They can certainly find me on Bush Pilot Marketing as well as LinkedIn. And I imagine Jeff you'll be sharing that article. I'm glad to connect with them on LinkedIn. One of the things that I'm kind of working with with some folks and we've had some discussions is possibly starting an online mastermind for folks interested in creating this learning point, this group to share different knowledge for preparing their business for that eventual sale. So that's another way that we're possibly looking at. If they connect with me I'll definitely keep them posted on where we're at with that. Thanks Jeff, I really appreciate the opportunity to share my story as well.
Jeff: John Chang, thank you. We have run out of time. We're going to have to leave it here. We enjoyed it.
John: Thank you, same here.
Jeff: John Chang, head of Bush Pilot Marketing in Los Angeles.
Deal Talk is presented by Morgan & Westfield, a nationwide leader in business sales and appraisals. If you'd like more information about buying or selling a business call Morgan & Westfield at 888-693-7834, or visit morganandwestfield.com. And make it a point to check in with us again soon for valuable information and insight from our growing list of small business experts on Deal Talk. My name is Jeff Allen, I'll talk to you again soon.