Bob Paden - Watching a train wreck happen - what do you do?
Ed had the opportunity to visit with Bob Paden of The Growth Coach. Bob is one of those guys who Ed just constantly bumps into his clients, and the peripheral advisors have nothing but good things to say about Bob.
Bob had been a solo practitioner and then he purchased The Growth Coach. And so Ed invited him to talk about a couple of things; as a buyer and about what the Growth Coach is.
Bob and Ed talked a lot about the same kinds of challenges that they are experiencing in serving business owners – and that’s preparation and getting the business into a condition where it becomes a saleable asset.
Be sure to tune in until the end, and enjoy!
1:23 – Who Is Bob Paden
4:48 – The Reason Bob Bought A Franchise
6:38 – The Difference Between Consulting and Coaching
7:39 – How Do You Differentiate Yourself From Other Coaches
10:08 – How Do You Determine Whether Or Not It’s The Right Fit
12:23 – How Do You Show Senior Business Owners Your Value
15:53 – What Do You See In Today’s Marketplace
19:08 – How to Get Business Owners To Buy An Investment
21:29 – Habits That Help Increase Business Value
24:21 – How to Find The Time To Plan Your Business
28:26 – Lifestyle or Legacy
29: 46 – How to Work With Bob Paden
32:10 – Piece of Advice That Has The Most Business Impact
33:23 – Connect with Bob Paden
Learn More From This Podcast
Who Is Bob Paden
Bob Paden is The Growth Coach of Northern Indianapolis. He spent 20 years at Rolls-Royce Indianapolis. Somewhere in the middle or end of 2008, before the downturn, he left Rolls-Royce after a 20-year career and ended up, by accident, starting his own consultancy. Even through the downturn, Bob had really great experiences in self-employment. He ended up with probably half a dozen clients by the end of that year. A few years later, he worked overseas in Australia, and a year and a half later he went back to the US and worked in Cummins in the power gen market. Then about a year and a half later, he ended up opening an engineering office in downtown Indianapolis with about 70 people here and about 70 people offshore.
When that came to an end, Bob evaluated what he really liked to do. He realized he enjoyed being self-employed and so he returned to consulting and coaching in early 2017. What he found was that a lot of his consulting clients ended up being coaching clients. And so, he started to make the transition over the last few years.
Earlier this year, Bob met a lady named Lisa Hudson who was the Growth Coach in Carmel. They hit it off and had a green conversation. Lisa ended up taking the role of the president of the franchise, and the next thing Bob knew, he bought himself a franchise in June 2019. In the last several months Bob has been converting his existing clients and future clients from his past business over to The Growth Coach, and he got a great team in Cincinnati that is supporting him.
Right now Bob is a solo coach but he also has a part-time coach that focuses on people and HR-focused things. Come 2020 he expects to add more coaches to the portfolio. He is currently serving business owners who are in the growth phase as they go through what typically Bob calls the “whitewater” or the rough patch of time in business where all these changes are occurring because of growth. It’s very common that only a few businesses go through big changes without going through the “whitewater”. Bob helps business owners and leaders believe that the actions they’re taking today will actually deliver the results they want in the future.
The Reason Bob Bought A Franchise
Most franchise owners would know that being on your own has a lot of positive, but some of the negative things are that you are alone. Despite a great network, despite a lot of colleagues in similar nature of the business, sometimes you do feel alone. Bob had been searching for a year for something (he could quite put his finger around it at that time) but then he met Lisa. He really liked how she did business. And so he took a tour and meet the team. He met very down to earth people and a great team. For Bob, it’s all about support. He got a great team behind him, he got a coach where he gets resources that he didn’t have on his own… Just having that to support not only his own business but also his clients has been extremely useful. And that’s why Bob bought the franchise.
The Difference Between Consulting and Coaching
Consulting, as Bob put it simply, is about “I may tell you what to do, and actually maybe do some of it for you.” Whereas coaching, just like a sports coach, they don’t mind getting their hands dirty from time to time. The job of a coach is to figure out how to get the most of what you are already doing not necessarily remake the wheel.
How Do You Differentiate Yourself From Other Coaches
Bob mentioned that all coaches probably know each other, especially in Northern Indianapolis and Indianapolis. He said probably not too many coaches don’t know each other. There are indeed many coaches out there but every one of them has different backgrounds, experiences, and niches. Coaching is a very personal business. Every potential client or current client chooses a coach for his whole history. In Bob’s case, he had 30 years of coaching experience. He has coached big teams, small teams, national teams, global teams, corporate activities, non-corporate activities, etc. The word Bob came up to best describe himself recently is ‘synergist’. He looks at things through a different lens than other people do. When he looks at business, he looks at processes – what they’re doing, how they’re doing it, and all the pieces of the puzzle. Gino Wickman, in the book Traction, calls it the integrator; Les Mckeown calls it The Synergist. And so Bob picked up ‘synergist’ to describe himself.
Most of Bob’s clients were what he would call ‘specialists’. They are small privately-owned medium-sized business owners. But they really just want to make some really big changes for the long term of their future – both for them and their employees.
How Do You Determine Whether Or Not It’s The Right Fit
When dealing with business owners, finding the right fit for Bob is all about the business owners’ thirst for knowledge and change. If the business owner is extremely risk-averse, if they’re not open to change, and they’re “happiness sponge”, he doesn’t consider them a good fit. What he’s looking for are those that are learning, reading, asking questions, and trying to figure out how to make things work. Those that truly want to look at the long term vs short term. Preparing a business for sale is not a short-term activity, so Bob is looking for those people who truly have that go-forward vision.
When there are partners involved, Bob usually starts with what he calls “the owner” or “the set of owners”. It makes it more difficult if they’re not on board. They really need to be ready to make the change. And if that change corresponds to what Bob calls the “Personality Match” and how he conducts business with them, then it’s a good fit.
How Do You Show Senior Business Owners Your Value
We’re seeing a lot of business owners aged 65 and older who would benefit from a 3rd party taking a look at their business and help them shepherd everyone in one direction. These are potential clients who might be exiting at some point. When asked how to show these business owners the intangible value that Bob brings and will bring to their business, Bob answered that the only way he can do it is through examples. He usually talks through past or existing client interactions to describe what he does. There are tangible and intangible benefits. Sometimes the owners just want to feel better about a decision or choices they need to make to figure out which direction to go. And sometimes it does not have an immediate financial impact, but it definitely has a confidence impact.
However, some senior business owners think that since they’ve been in the business for 40+ years, there’s nothing anyone can tell them that they don’t know. It’s a tough spot because they’re not willing to consider somebody else’s point of view.
Every business can be a mess, some less messy than others, but every business has its challenges especially privately-owned or family-owned businesses. There’s a reason these business owners talk to people like Bob, and it’s because they want to know and that’s where they start. But if there’s a hard client that Bob can’t break through, then until they really want to make a change, Bob will just keep them in mind and keep in contact.
What Do You See In Today’s Marketplace
According to Bob, there is a bit of a denial of reality. Every private owner that Bob talked to has a number in their head that they want their business to be worth and think it may be worth but is not necessarily backed up with facts. What he’s been telling a lot of business owners lately is to think about who’s the buyer will be and not about them as a seller. You have to have a buyer who wants to buy the business, and it may not be a boomer anymore. You may have a millennial buyer. You have to think about how your business looks to them. Bob said it’s frustrating because business owners want their business to be worth a million dollars but there’s nothing to back up its true valuation even down to the financials. Just from a megatrend standpoint, the amount of boomer retirements of people who own business is staggering.
Ed agreed as he saw the same thing too. He added that it’s hard to believe that with this much information available out there, business advisors still have to fight the battle of understanding value. It’s a tough spot to be in because they know that making the asset liquid for selling is integral to the business owners having a reasonable retirement. Most of the value that the business owner is going to receive could have been corrected if they just started the process a year or two earlier.
Bob added that he tells everyone he meets that if they’re thinking of selling their business, they need, in absolute minimum, of at least a year – maybe 3 years. There’s a whole list of things that are involved when you decide to sell. And because each business owner is different, their financial lives are different, their goals are different, there’s a lot of ground to cover.
How to Get Business Owners To Buy An Investment
Bob explained that he initially set expectations. He does not promise the buyer that there will be a return of investment. There is too much work that rests on the buyer compared to the seller or the owner. Bob’s job isn’t to do all the work for them. He describes himself as the whitewater-rafting guy – the guy at the back of the boat. His job is to paddle and guide the boat to where you want it to go, but in the end, you have to be paddling with your team to steer your business in the right direction.
Bob doesn’t make any bones about having a discussion when someone is going to spend thousands of dollars over some period of time to figure out a way to get more out of their business. For Bob, that’s real money and he doesn’t make light of that at all. The other thing he’s looking at is what else do business owners invest their money in, or, in a lot of cases, how much money is being wasted by not doing certain things.
Habits That Help Increase Business Value
Here are the 4 habits that Bob recommends every business owner must have:
Get out of the middle of everything. A lot of private-owned businesses, even medium-sized businesses have their owners in the middle of everything. They need to figure out how to get out of the middle and be removed from being the point of constraint. There’s a lot of constraints by having the owner in the middle of every decision and every function. Work ON your business and not IN it.
Mindset and thinking strategically. There’s a lot of business owners that are really just employees. They need to set up their business to function without them.
Plan. Whether it’s a small or big business plan or what Bob calls a ‘one-page’ business plan. He usually finds that business owners don’t have plans, and so they can start with a one-page plan. It’s actually more of the process of planning than the plan itself that has the value. You can create a business plan and put it on a shelf so nobody looks at it, then it’s pretty much a worthless plan. Planning and replanning your business at least once every quarter is extremely important.
Know your numbers. You need to know at least the basics of your financials.
How to Find The Time To Plan Your Business
Start small. What Bob typically ask people to do is to dedicate an absolute minimum of 2 hours a week. If you’re not willing to spend at least 2 hours a week to improve your business, then you’re really not dedicated to it.
One of the first activities sometimes that they do is to have them record what they’re doing. It’s nothing complicated. And if they look at their notes after a couple of weeks or after a month, it usually surprises them. It’s analyzing what they do every day, and they realize that a lot of times there’s a lot of waste there. And so they immediately start looking at what they are spending their time on today, and who else can do it for them, and then they start small. For every business owner, it’s a little different based on their background.
And as Ed pointed out, it is also a way of getting out of the middle of everything. You basically list down every job that you do over a week or a month or any time frame, and then you prioritize and then you start wiggling them off by delegating them to someone else.
Lifestyle or Legacy
When asked whether he’s seeing business owners interested in lifestyle or legacy in today’s market, Bob says it’s a mix of both. It’s a challenge that comes up a lot and he calls it the “Boat vs Business Dilemma”. When a business owner, on a monthly or quarterly basis, totals up and goes to their accountant and find out that they made a decent profit, what did they do with that profit? Sometimes, business owners want that return on investment to help them personally. That may be a boat, or a house, or a vacation. This is actually one of the areas that Bob started focuses on – how business owners manage their financials on the business versus on the personal side because it affects not just them in the short term but it also affects their business and their culture, especially their employees. Whether they like it or not, when the owner is focusing more on the lifestyle than they are on the legacy, it becomes apparent to the workforce. It drives a lot of negative things in the workforce and the culture of the business.
How to Work With Bob Paden
Bob, being a coffee-type of guy, usually starts conversation over a cup of coffee. They talk about their goals and what they will get out of it. They talk about past experiences – both good or bad. Then Bob will talk about his approach to this. They would start with what Bob considers a typical approach which is an every-other-week accountability session where they spend an hour or a couple of hours a week or every other week and start with identifying the main goals – both long and short term goals. Then they do whiteboard sessions where they just splatter everything against the wall and flushing out a problem, and then start dealing with the immediate pain.
Piece of Advice That Has The Most Business Impact
View your business as a machine. Step back and look at your business as a machine. Look at the moving parts, the processes, the gears, and what’s in it. And if you find yourself in the middle of that engine, then you have to figure out how to get out of that middle. Future buyers don’t want to buy a business that has the owner in the middle of it.
Connect with Bob Paden
You can connect with Bob through these channels:
Company site – thegrowthcoachnorthindy.com
LinkedIn – https://www.linkedin.com/in/robertpaden/
Facebook – https://web.facebook.com/gcnorthindy/
Twitter – @TGCofNorthIndy
Email – firstname.lastname@example.org
Phone: (317) 559-3900 and (317) 733-7130