EP 119: How to Sell when the Business Owner is the #1 Sales Person

Ed Mysogland  1:28  
And I said, I said, Yeah, I've met her a few times at some events. And he goes, Well, I think what I think what you should do is you should have her on your podcast, because this is what she does, she is she's a consultant, She is president and partner of hunt big sales. And then for over 12 years, she's been been helping, you know, mid market companies, you know, establish vision, and, and implement sales processes. And so, she has been, so we just concluded our interview, and there were so many, so many value nuggets that we talked about, and, and one of the biggest things has more to do with understanding the scope. When understanding if I'm a seller understand the scope of what I'm trying to accomplish. And, and, and limit limit what success means to me by that scope. And conversely, you know, on the buy side, you know, how to adequately assess the, the, the sales process of the target that you're looking at. And charging has taught so many professionals throughout the country, and it's well into the billions of the high ticket items that they're selling. And, to me, there is no bigger sale to a seller than a company, a company that is yeah, that you're emotionally tied to, and that your net worth is dependent upon. And so, you know, she care Jane just comes in she's like said she'd been president of HUD big sales for I said, 12 years and, and in actuality, it's closer to 18 years. And she has been consulting and helping people grow their business help helping them understand how to develop their sales process. So it's repeatable. And they've added value to every company that they have ever worked with. And so I am 100% certain that you'll enjoy listening to my conversation with care, Jane more. Care. Gary Jane, welcome to the podcast. How are you?

Carajane Moore  3:59  
I'm doing great. Thank you. Glad to be here.

Ed Mysogland  4:02  
Well, before before you came on, I was talking about you and and why I wanted you to come on. And I probably did a disservice as far as your background. So why don't we start there? Just a high level overview of you and your practice and how you you help business owners.

Carajane Moore  4:22  
Oh, well, thanks. So I'm Kerry J. Moore, and I'm president and partner at humping sales. And we have been around for about 17 years. And we, Tom my business partner is one of the top five global gurus in the world on sales. And we have been helping our clients which are really the mid market section, a privately held business to business complex sales grow very, very rapidly, and many of them to exit with multiple times more than what they normally would. And we've got over $22 billion in new business and growth this As far as clients sold over the last several years, no way?

Ed Mysogland  5:02  
Well, I don't know if I, if I even told you how you came on the radar, and I was talking about this at the very beginning, before you came on, is that we're talking about a business owners, the biggest sale of their life, the absolute biggest sale of their life. And, and it and I'm looking at it from two sides, one, the buy side, you know, they're, they're selling themselves to this business owner. Alright, so so that's a big sale. And I've got that I've got the the seller, on the other side selling to the buyer. And so I, it was funny, we were talking about, you know, how do you how do you sell. And by the way, I the third part that I failed to mention was that, you know, these entrepreneurs, they start as the sales person, I, they're the ones generating all the sales, and then all of a sudden, they become locked in that they are the business. And so that's the the third component I want to talk about, but right out of the gate. So the business owner, the business owner is selling their biggest asset. I mean, this is this is their net worth. So I guess I wanted to explore, what does that look like when you're trying to sell something that a is emotionally tied to you, B is going to have a remarkable effect on your net worth? Yes, if you're able to do it. So how about riff on that for a few minutes? Yeah,

Speaker 1  6:39  
you know, it's, first of all, we have to admit that it's one of the most exciting things, as an entrepreneur to go sell your business to somebody. It's validating, it's exciting, it's emotional. And it may be it's the fulfillment of your life's work, right. So it's, it's, it's all those things, it is big and, and that's super exciting. But so many times, I find that the people who are selling their business, try to participate as if they're a buyer, and waiting for the buyer to be the seller to them. And it's an interesting perspective, because I think you laid it out correctly, you are selling your business, and the buyer is selling them. So we're both selling at the same time, which makes a very interesting dynamic as you as you look at that transaction, so the different transaction, but we're both selling. And so if we can come to that common ground of what is the business problem I have, that they're solving. And they understand that the business problem they're solving is the problem I have, then it kind of evens the playing field of what are we trying to truly accomplish in this transaction. But it's critical, it's critical as the as the seller, that we stay focused on that not the outcome of the dollar amount. But what is it we're trying to accomplish in in our life in our business, that, that this is the solution we're looking for. Because I think too many times we get caught up in the numbers, like it's big money, and it's big dreams. And it's a lot of that and we miss some of the real details that make the transaction and the deal the right deal for you.

Ed Mysogland  8:27  
Well, one of the things that, you know, as far as goals, all right, alignment of buyer and seller goals is on the sell side, it's liquidity, like I need you to make me liquid. Alright. And as a buyer, I'm sitting here saying, Man, that there is so much risk in me doing so this this, while I believe everything you say Mr. Seller, there is a component and there's a an entire cadre of of advisers saying you need to be real careful about this. So, so when when, when you talk about the problem, now, the seller has liquidity problem, the buyer has the mitigation of risk problem. So how do you align align those because I know they're, I mean, clearly we sell businesses all the time, so you can clearly get past it. But you know, as you're, as you think about your can your consulting practice in the work that you do, how do you how do you help both parties align? When when one is is looking at minimizing risk, the other is looking at maximizing value.

Carajane Moore  9:35  
Right? They're looking at maximizing value. But you know, one of the things that we talk about is the you know, and I'm sure everybody's seen it out in the marketplace is this Zopa zone of possible agreement, right? Well, the possible agreement, or the Zopa is more than just the numbers and more than just the risk, right? The risk is a better way to look at it than just the numbers on the liquid To decide, because if you because the emotional time, you know, I work with clients all the time who are selling right and a part of that, and part of it absolutely is the numbers. Part of it is, you know, how long do they have to stay engaged? How are their employees going to be treated? How are they going to be viewed in the marketplace? So there's those elements that take a position in the liquidity side of the house, right? That are elements of risk that are being considered by the buyer side of the house. So how do you get alignment? Well, we have to have a very clear picture of what what it is we will be happy with, in all elements, not just the number element, and the pieces that you're willing to negotiate on and not negotiate on. And the risk, people have to have a very clear picture of what is the risk mitigation they need to see, to be comfortable? And sometimes there's not a clear answer there, or they haven't defined a clear answer. And so this group can't meet it because it's an undefined need. And so it's that clarity and specificity in which it's a measure. If if I don't have all of the leadership that I want, okay, then then the risk is, is it the replacement of the leadership? Or is it a price to reduce them, and this grip is saying, We've been operating without that leadership. And it's not me, the owner that's managing it, it's somebody over here. And that's why in your normal structure, you might look at that, but we've managed it this way. So you can mitigate maybe the initial risk, but it maybe it's still a long term risk, but those types of things allow you to then start to hone in on that zone of agreement.

Ed Mysogland  11:49  
And I'm embarrassed to say I've never heard the term Zopa. So, so back back me up a little bit. You know, because if I haven't heard of or heard of it, I'm assuming other listeners haven't. So tell me more about the zone of possibility that that was a possible

Speaker 1  12:05  
agreement. Right. Okay. So it's a negotiation term. Right? If and buying and selling, there's always negotiations, right? And so we're in a negotiation, it's a negotiation term. And what you're saying is, is oftentimes in deals and you've got this as the number, and this is the number and we're trying to get together, right? Well, an even I'm guessing in the buying and selling of businesses, it's the same way some of the people that start the initial conversations are not the end negotiators. Their job is to get things into a zone of possible agreement to determine if the real negotiators have a place to come to the table. And Tom, interesting, right? Yeah, so there's layers of negotiation and all deals, and there's somebody's role is to get it to a zone of possible agreement, and then it it's the final negotiators job to get to alignment. And so what ends up happening is, in some of these types of things, we start at the owner, and we start at the buyer. And so now we're negotiating, you know, kind of here and here, and we're playing multiple roles at the same time. And I think that as a seller of your business, you should have a very clear set of roles and responsibilities, as the owner, who your CFO or financial responsibility person is, who is your operational person, and who's going to start at what levels of the negotiations. And then the buyers have the exact same set of things, there are things they're looking for, there's places they need to be. So your due diligence and all the rest of that is what starting you to get from here, down to the zone of possible agreement so that we can actually get to a final note,

Ed Mysogland  13:46  
I got it. So it's synonymous to like a letter of intent versus a purchase and sale agreement. So absolute, so we're talking in concept this is this is the framework of our deal, and we're going to work our way down to the specifics of up to a point where we can collectively close I got Okay. Moving to the buy side, and I, I am on this kick that baby that baby boomer business owners are being hunted. And you know, and they are I mean, it is a you know, it 52 What I read 52% of all Indiana businesses are owned by business owners over 55. So, so they're being hunted by all kinds of of people, whether that's private equity groups or entrepreneurship through acquisition, you know, your high net worth, folks. I guess what I wanted to ask you is all these business buyers, they come to the table and they have the resume. They have they have sort of the deal chops. And the end the business owner is kind of overwhelmed, right because that business owner will do this once that business buyer has probably looked at, you know, certainly 10s? If not, unless 100. But I'll bet you they've looked at, you know, 10 times more businesses than the seller. Oh, sure, hazards. And so my, so they're clearly out gun. But my point is that when the when the buyer shows up, how does that buyer present themselves to the seller in a manner that is disarming and gets them the opportunity to at least pitch on why, if all things being equal, as far as value goes and the purchase price? How do I stand out? Why would you select me over somebody else? How's that for a loaded? Question?

Speaker 1  15:46  
That's a very loaded question. But I think that, you know, part of the reason why I'm here is because of being hunted, right, what we do is teach people how to go hunt large deals. And I think that there's a lot of similarity there. First, if you are the buying company, you've already defined a very nice tight window of the type of opportunities that you're going after, why you're going after them, and what market they're going, you're going after? And what is it that you're looking to accomplish there, right. So you already have built a filter that allows you to step in, and most likely, you're stepping into an industry or a marketplace you already understand or to a buyer in which you already standard stand the problem that they have. And liquidity is one of multiple problems, right? So how do you approach them is the way I would approach a large account, right. As an expert, I understand your marketplace, I understand where you are, I understand the problems you're trying to solve this is where I've already done it in the past, these are the outcomes we've provided. And I'd really like to talk to you to see if there's a way that we could provide those outcomes for you narrow it down to be very specific, very personable, and very directed to the problem and the person you're talking to. Interesting.

Ed Mysogland  17:03  
So there's three buckets of buyers. Alright, so you got your private equity groups, you got your strategics. And then you have your, your financial buyers, those that are looking to buy themselves a job. So the way you describe that private equity, hands down, I have my model built, and it's just a matter of whether or not we can put piece you to piece you as a platform or an add on. Right strategics I have, you know, either were direct or indirect, let's say competitors, but there's some synergies, so I can sell you on that. Now, what about the financial buyers? How when I when all I have is either a resume, you know, I've been displaced? I'm looking, I'm looking to be my own boss, how do I how do I sell that?

Speaker 1  17:53  
I think the same thing, you know, I and when you're looking to be your own boss, you go look, I looked at this marketplace, I looked at your business, I am looking to, to buy a business that puts off a certain amount of net margin, and which I can step in and maybe add some additional investment dollars for a faster growth to it. But to come in, and you know, buy a business that generates a set of profits, and you've done an amazing job of doing that you build an amazing team. And I really like your business. And I would love to talk to you about being able to help you transition from you running that business to now me running that business going forward.

Ed Mysogland  18:39  
Well, it seems it seems as though a lot of people in that scenario, botch it up when they start talking about I want to preserve your legacy. All right. And, and, and, and, and a lot of the business sellers just called BS, you know, you don't know me well enough to know about my legacy. It's just somebody somebody gave you the talking points and, and, and how to emotionally connect to me. And as a, and I'm moving more toward the sell side. Now. How do I sniff out the BS? You know that? Because there's a lot of

Carajane Moore  19:17  
Oh, yes, but here's so once again, I'm going to raise back to the questions of what are the problems you're trying to solve? Are you truly trying to solve a legacy problem? A lot of people think they are because they also think that those are the talking points that they should say, No, when they're really looking for a paycheck. Okay, so So where are we going? Where are the points that you really care about? And then once again, if you want to start to sniff out BS, you start to sniff out behavior. In a sales process. There's a lot of talk, but you got to watch what the behaviors are to justify. So it's about a more of a fact based or behavior based set of response. says that let you know is that BS or not. But once again, you have to be comfortable with what are you trying to sell, I had a friend that was selling their business. And he was all concerned about his people. And I don't think there's anything wrong with that, I really don't. But here's the thing I'm going to tell you, it's no longer yours. Yeah, it's no longer yours. It's just like, when you sell your house, the person that comes in and buys your house, they might rip out some rooms, they might repaint it, they might redo all the landscaping, okay? It's no longer your house, it's no longer your business. And if you're really trying to sell your business, you have to be comfortable with the fact that at some point in time, they're going to do it their way. And that's what you're, that's why you're selling it. You don't want to do it anymore. And so they botch it, because they're making promises that no one believes they're really going to implement, unless they can prove that that's what they're gonna do. And, for example, in the book that we wrote, how to do a deal like Warren Buffett, Warren Buffett goes in and actually sells the buyers on why they should sell to him. And in that, in our research, as we went through that, he spends a lot of time about why he's in that business and why he wants to buy it. And normally when he comes in, they stay on and they stay on for decades, because he doesn't want to change it, versus somebody who wants to buy a job, right? So it's really critical that we actually have the behavior and use the words of what we're actually authentically trying to do. And the and the people who are selling, also have to recognize that if they're no longer doing it, they can care. And I had my friend, I said, you want to take care of your people out of what you get bonus them very nicely so that they can go somewhere else if they get let go. But you can't expect the buyer to do it the way you did it. Because you no longer own it. Yeah, no, that's

Ed Mysogland  22:03  
good. That's a great point, in fact. Yeah, well, I think one of the key takeaways there is, is that you know, it as a business seller, you know, it's okay to not have to, I don't want to say care about your employees, it's okay that, you know, this is this is your event, and post sale. And you can kind of select the best person that you think will operate like you and do all the things that you might do, and the culture and all of the other intangibles. But at the end of the day, you're right. It's not, it's not your business. So, you know, you have permission to make the decision that's best for you that maybe, you know, and I and to be honest with you, I think there's a lot of a lot of business talk that everybody's caring about their employees. And I'm not. I think that's a I think that's on the list. I'm just not certain it's in the top three. I just, I think it sounds good, but I don't think that it, it happens all the time. So that's good. I'm sorry, good.

Speaker 1  23:16  
Yeah, no, I agree with you. And I think if it is one of your top things, then make sure you get a number in which you can carve off a section to take care of your employees, because it's your responsibility, if that's what you feel like, it's your responsibility, then you need to handle it out of your portion. Because there's no guarantee that the buyer is going to do anything that you want them to do, because they bought that asset it is now theirs.

Ed Mysogland  23:39  
Well, it's interesting that a lot of a lot of in a lot of deals. Now they're they're baking, that in retention bonuses, where the buyer and seller are participating collectively to view stay six months, you're going to get X number of dollars, but at the same time, you know, the buyer or the seller still needs to understand that that's, you know, part of that value is coming from you. You know, and that buyer also reduced their purchase price by the amount of the retention bonus just in case you were wondering, so collectively we have a number but but how it's divided. And that's that that retention bonuses go into the go into the the employees not not you that just made you able to sell it easier. Right. Alright. So now, I really need you to put on your consulting app. So like I was mentioning earlier that the business owner is tends to be the number one sales guy. I especially in the smaller businesses, where there's not a whole lot of layers. You know, I'm talking 50 people and less and that business owner has always been the guy or the girl, you know, and they they are so help me help me sell my business when the bulk of the revenue risk is sit in my lap.

Carajane Moore  25:09  
But right, so first and foremost, if if we have time, I would encourage you to start to capture what it is that you do in a stage by stage process, and have someone else in the organization shadow you so that they can do it. If you have time, prior to the I'm somebody came and offered me an opportunity to have this conversation, because you and I both know, you reduce the risk for your buyer, if you are not the person that is pregnant, primarily selling your business. So that would be my first thing. But if that's not the option, yeah, we're in the reality of this. One of the things that's really important that is very hard for an owner because they're emotionally tied to it. But to separate out the language of what makes their business unique. It's the business problem they solve, and the expertise that they bring to that business problem, right. That's what, that's why people buy from them, because of that passion and that expertise. So if you can help a buyer understand who would have some of that expertise. And there's the business problem, not the when you are the engineer, or the coder or whatever, sometimes you get into the weeds of how you solve that problem. But the bigger business problem you solve, if you can start to bring some of those languages and some of the players have who can solve and help address that problem as a subject matter expert, other than you that would allow that a buyer to start to understand what is the risk? And how hard is it to replace you. Because let's be honest, you've done it because you're unconsciously competent at doing it. And you like doing it because you like the energy and the adrenaline hit of being the salesperson is fun, it's creative, it's all the rest of that stuff. So you've done it for a long time. But it doesn't have to be you. And you're unconsciously competent at doing it. And so now what we need to do is have somebody help you break apart, that which you are unconsciously competent to be consciously competent. So you can then walk a buyer through why it doesn't have to be. So

Ed Mysogland  27:35  
how do I how do I do that? I mean, you know, there's, there's, we've had a number of people over the course of the, the the podcast that have you know, how they document processes? Is there? Is there like a, you know, it's one thing to you know, how to how to open the business every single day process versus a sales process. So how, how do I document or how do I memorialize that? Or at least get started with that?

Carajane Moore  28:10  
That's good question. I mean, honestly, that's all of what we do is to work with those business owners to pull out of their head why they're unconsciously competent, and put it into a model that makes it replicable and scalable. So that's really what we do. But how do we get started? Go back to your customers and ask them why they bought? What is it? What was the business problem they were trying to solve? Because we think we know, but we get caught into the details of what is ours? Versus what was the problem we saw. So if we can go back to the marketplace and figure out what was the common thread against our customers of the business problem we solve and the outcomes we provided. That's the first place so now you know the business problem and the outcomes and specifically the type of market you can go after and then recreate the sales process by evaluating what are you trying to accomplish in the first set of conversations? Who needs to talk to who what information do you need to get what information do they need to provide? And that becomes a Stage Gate and you move all the way through? And I will tell you if you are the actual one doing it, I would recommend you work through it in reverse. I got a contract, what had to be true before I got the contract, who had to be involved, what did they have to have agreed upon? What did I have to have agreed upon next stage before that, and you run back through it but you build but you build that out to start to document it and I encourage you not to do it in a vacuum. Who else was a part of the conversation with you was your operations person involved? Was your engineer involved to us and and take a couple of hours in a whiteboard. Okay, and pull through it.

Ed Mysogland  29:57  
So what happens when When I talk to that customer and that customer says, You know what, Cara Jane, it's because of you know, you and I've been doing business for 15 years, and I just know you. So now, now if I'm the business owner, I know enough. That's like, Craps. Now. Now, now they're assigning personal goodwill to me. And, and then again, you, you alluded to it earlier about as far as diversifying who you are, and kind of push it out. What happens if I don't have time? You know, what happens if a sale is eminent and, and now I hear this, and I'm like, 24, is the year I'm going to sell my business. And I can't I can't get out of I can't get out of out of this. So what do i Is there any? Is there any way to mitigate my risk?

Speaker 1  30:53  
And you could say no, as the seller or the buyer,

Ed Mysogland  30:57  
now? Well, it's six, one half dozen, the other because it's the buyer, the buyer is going to take advantage of it one way or the other. As soon as they as soon as they know that, that you said those words, there is either a performance based kind of financing vehicle put in place to mitigate the risk, or I'm going to just lower my price. Right? So

Carajane Moore  31:20  
exactly, because they're gonna, because it's just like anything else, right? They're gonna have to go do that work. If you're not going to do that work, then they have to go do that work. The work still has to get done. It's just a matter of who's going to do it. Now, you can pay somebody to go do that. But you and I both know, In the financials, what's that going to look like? Yeah, right.

Ed Mysogland  31:39  
No, you're right. It's good. Yeah.

Carajane Moore  31:41  
So to be honest, if you don't have the time, then you have to be. This is one of those things, when we talk about selling and buying and all the rest, that's that the scope is the scope. If you want to reduce price, you got to reduce scope. If you want a bigger price, the scope goes up. So you know that that is what it is. And so I would like to say, yeah, there's a magic wand, and we're going to waive it, and it's going to be easy, and I'm going to fix it. And complex problems do not get solved with simple answers.

Ed Mysogland  32:09  
Nah, hear? In fact, I It's funny, you say that? Because I mean, we tell sellers, you know, they, you would put your put yourself in the buyers position? I mean, would you do that deal? If if if all of the revenue is tied to you? I mean, would you just stroke you a check in? And just hope for the best? Of course not. And anyway, right? It's a, it is a it's an interesting dynamic, especially on the revenue. It's, it's a, it's different when it's a practitioner, you know, you can mitigate that risk, you can find somebody to kind of backfill, but when you're talking revenue, it's an entirely different risk game. Yeah. One of my last questions is, so, again, put your consulting hat on, you're engaged by the buyer, and you're engaged to evaluate the sellers sales system, or sales process, sales process. How do you do that?

Carajane Moore  33:09  
Yeah, so Well, I look at sales processes all the time to evaluate what it would be like for me to come in and help them with the sales process. So first and foremost, what we're trying to look at is, where do the leads come from? How are they generated? Right? And are there enough leads to reach the goals and the outcomes, right? But say that's done. And we're actually in the sales process itself. So prospecting is separate from the sales process. The first thing I want to understand is, is the process measurable at every stage? Do we have measurable, tangible outcomes for every stage? And is it being measured at every stage? Is it you know, which means it has to be written, it has to be clear. And then what do we have to know to be true? And who has to be there at every stage, documented, of course, I need to have demonstrated repeatable results, meaning he can't be I've done it for a month, I have to have seen 456, especially if you're talking about big deals, if you're talking about standard deals, you have to see month's worth or years worth of I followed the process, and you can see it through a tracking mechanism. The last thing is you have to measure the movement through a sales process, not the motion of the activity of the salesperson, are they measuring movement through a sales process, or the measuring motion, or activity of the salesperson? Because activity of the salesperson does not mean that you're going to close a deal. It just means they've called that many people. So are they measuring the right things to demonstrate the repeatable process? And then lastly, I need to see if it's transparent, are the numbers real? At this month at this stage? They say that they're going to close 63% and at this stage When I looked at their dashboard, did they actually close 63%? did or did they close? 33%? So that's when you start to audit and go, Is this a real sales process? Is it truly being followed? are they measuring the right things for outcome that demonstrates repeatability and scalability? I

Ed Mysogland  35:19  
got what a great answer. So my last question is that, and I and I've asked this, you are episode 121. So I've asked this 120 times that if you had one piece of advice that you could give to our listeners that would have the most immediate impact on their on their business value or their business saleability, what would it be?

Carajane Moore  35:44  
I would say that right now, most sales processes are measuring that motion, and not the movement. And my piece of advice is, if you're a buyer, measure, and make sure that your sellers are measuring the movement through the sales process, versus the motion of the salesperson, and that piece of advice is going to really tell you do they have a business mission, a Sales Machine, or not for the value of the company, and if you're the seller, make sure that that's what you're measuring. And you can and you can document because that's what's going to add the bumper and the fee that you're looking for.

Ed Mysogland  36:23  
So what's the best way we can connect with you?

Speaker 1  36:25  
There's a lot of easy ways so it's Kara Jane ca RAJNE at hunt big sales.com Or go to hunt big sales.com and fill out a form that you want to talk to me or call me directly 317-847-8037 Got it? Well,

Ed Mysogland  36:45  
we will have all of those in the show notes. And you know and like i said i i didn't know what to expect with with this one. I mean, I knew you're an authority in the domain. I knew that part. I was just I was sitting here going I wonder how this is going to shake out and and I'm so glad we had the chance to talk because this is so I can't tell you how many deals have a either fallen apart or be reduced. We had to reduce price or struct or re retailer structure in order to accommodate the this wholesale program so so I'm so grateful for the time and it was everything that I had hoped it would be so thanks so much for hanging out with me this afternoon.

Carajane Moore  37:32  
Well thanks, dad. I fully enjoyed it.