Episode Transcript
[00:00:02] Speaker A: Welcome to Intentional growth, a show that teaches you as a business owner and entrepreneur, to view and run your company like a financial asset, which will allow you to enjoy work, create wealth, and make an impact. This mindset will help you focus on building a more valuable business and give you the choices to grow, acquire, reinvest, or exit. Live the life you plan for all with intention.
And now, here's your host, Ryan Tansom.
[00:00:32] Speaker B: Thanks, everybody, for tuning back in. Very pumped for today's couple guests and the next couple episodes that we're going to be diving a lot into finance, pricing, and value based pricing and how to make sure that you're running your company as an asset. And I've got two guests on today, Chris White and Jason Petro. And we are going to be talking about how they are going to be taking the profit first model and actually turning it into an online system. Chris White is a seven times entrepreneur with over 15 years as a coach. He co founded 90 IO. If you're familiar with EOS, a lot of EOS run, companies run on 90 IO to help run their traction system or their EOS system in their organization. And he's also been in a lot of other businesses that he's grown and sold, and he's also got a company called System and Soul, which is a business framework. And then Jason, who's his partner in this new venture where they're rolling out the software for the profit first business model, is the driving force behind profit Pro, which is the new system. He is a certified profit first professional. And what I think is very unique about Jason's story is he actually has a software tech company. And in 2020, when Covid hit and all the stuff, really, like a lot of operational cash flow problems, really came to a head for a lot of companies, he realized that he had a lot of stuff to fix fast because the cash evaporated from the company. He picked up profit first. He talked to Chris, who was his EOS implementer at one point back in the day. And Jason took his company out of the nove dive using the profit first model. Therefore, he became an evangelist over it and then talked to Chris, who had built the 90 IO, and said, hey, let's build a system for other entrepreneurs to help them get better access to the profit first business model to help them run their company like an asset. And there's so many gold nuggets in this conversation. I know you're absolutely going to love it because it's case studies, but also a lot of discussions around, what are we doing to eliminate the stigma around financials, make it more accessible to a lot of us entrepreneurs who are operators and people that are running the day to day of our companies. Thanks everybody for tuning in. If you like this podcast, please go on to Apple. Leave it a review. It means a lot. I hope you enjoy this conversation with Chris and Jason.
[00:02:41] Speaker A: This episode is brought to you by Arcona's fractional CFO services. Arcona's fractional cfos integrate into your management team and assume the responsibility of the CFO. They become your strategic financial partner to help you run the business, create your value growth plan, and build the financial roadmap to the valuation you want to achieve.
[00:03:03] Speaker B: Chris and Jason, good morning, guys.
[00:03:05] Speaker C: Good morning.
[00:03:06] Speaker D: How are you?
[00:03:06] Speaker B: I'm very, very excited about this. We were talking about some good music before we hit record, and I am very excited for this conversation because you guys are doing some cool stuff now, looking towards the profit first system. And Chris, you've got some background with what you had built out with 90 IO and systematizing the software behind the EOS system. But you guys came together for this new venture, and I think the story is cool about how you came together. Jason, actually, I met you at a CEO nexus a little breakout conference last year. And why don't you give us each a little bit of a cliff note of a little bit of your background. And then I want to start, Jason, with your story of how you realized that the profit first system, I mean, it worked, you applied it, and then it did something for you, which is why you're now an ambassador of it, which I think is pretty.
[00:03:59] Speaker D: And, you know, I wound up hearing at the CEO Nexus group. That's where I actually learned about the first system.
My background is actually in engineering, so I spent the last 20 years or so developing custom products and things like that.
And I started a company called Uprev about back in 2011. And going through that journey, right, you go through the ups and the downs, just like business cash flow problems and this and that. And we were doing really well, right? We were doing well. We were growing. Moved into a new facility, and things just kind of came crashing down all at once, you know what I mean? Like the sales pipeline collapsed, some of our contracts went away, and it was horrible, right? We had just hired a bunch of people, just moved into a new, beautiful facility. And, yeah, I just got so tired of that roller coaster. And I think the real kick to the shorts came when we were actually profitable. This was a year prior to all this happening. We were very profitable in that year and it came time to pay Uncle Sam and the P l statement, you know, you're doing great, Jason.
No money in the bank account, right? I owed him to Sam. I'm like, what am I missing?
So I brought it up to the CEO group, to my peer group and yeah, they said, hey, you got to read this book, profit first. Great book. And I read it over the weekend, started implementing it and changed my life, to be honest.
[00:05:38] Speaker C: It is awesome.
[00:05:40] Speaker B: And I'm excited that we're going to unpack that story. Some of kind of the nuances of what you went through and why. Profit first in the system helped overcome that. But Chris, why don't you interject here about your background and then how you guys met and what you guys are about to do, I think is a cool container for the conversation.
[00:05:56] Speaker C: Yeah. Thank you. It is a cool story.
A really cool story, actually. So I am a serial entrepreneur. Seven companies five exits prior to that, I was a Motorola two way radio salesman.
I am a third generation entrepreneur. So my parents and my grandparents all had their own companies. But being the 8th boy in my family, I never thought I'd be an entrepreneur. It was hard, man. I grew up in the early 80s, so I rode those economic waves with my parents and their business and I'm like, how come we're not going on vacation? How come I can't get those shoes right? And so I never thought I'd be an entrepreneur. And then lo and behold, one day at Motorola, I just had this epiphany. Like, all I'm doing is selling a commodity. I got great experiences, high profile clients, Ford, Honda, GM, Millerbury. But I was a great hunter, right? And I was good at my job, but it wasn't gratifying. I just wasn't fulfilled in it. So I started to look for new opportunities. And that's sort of when I had my epiphany that maybe I did want to be like my parents and my grandparents. So fast forward and I get a phone call from a business owner in New Jersey.
I had built and sold three companies and I got this call in the.
[00:07:27] Speaker B: Text primarily, right, Chris?
[00:07:32] Speaker C: Yeah. All tech space. Our first product was called Ascend. It was point of sale software, pc based.
And I only targeted truck bicycle stores because they were all on Dos.
[00:07:51] Speaker B: Yes.
[00:07:52] Speaker C: I got like 100 stores in the first year and that's when I got truck's attention. And now Ascend is in their stores worldwide. That's a fun story, too. But anyway, so I got these companies and things are going great and I get a phone call from a business owner who wanted me to join his senior leadership team and his board of directors because they were hitting the proverbial ceiling, right? Stuck at 10,000,060 employees, no profit. And so I said, well, tell me more. And he goes, I'm just going to send you a book. He goes, read the book, and if you like it, call me back on a Saturday morning, I got a copy of traction by Gina Wickman. I never heard of it. Nobody in my network every what year was this?
[00:08:35] Speaker B: Because that would have been probably.
[00:08:39] Speaker C: No, the book came out in eleven, 2011, somewhere around there. And this was closer to maybe 1213, somewhere in there. So anyway, I read the book and I'm just like, holy shit, where was this? When I had my other companies, I did okay. I got nice multipliers, but I could have been a better boss, a better leader. I could have had a healthier culture. So I'm reading this book and I'm like, oh, my God, this is amazing. So I called the owner back and I said, never heard of the guy. I called my network. Nobody's ever heard of the book. Like, I'm all in. I got to do this. So for two years, I sat on a senior leadership team with an us implementer out of Detroit. The program is designed 24 months and you graduate. So on graduation day, the coach, the US coach came up to me and he goes, hey, Chris, I get the feeling you think you can do what I can do. And I looked him in the eye and I said, that's a really good recruiting pitch. But I said, yeah, I can. I've got the entrepreneurial scars. I've already built three companies. I said, this is amazing. So flew to Detroit, met Gino, went through his training program. I was one of the first Us implementers. While I was there, I wrote a book called the Clarity Field Guide for Eos. And then I developed software called 90 IO, and that bridged the gap from the book to a platform that is easy and accessible, blah, blah, blah. So that was a lot of fun. And then Jason and I meet. He's in a peer group. He heard about traction. I think my sticker was in the book. He called me. I went and met him and Richard, and so, I don't know, three or four years we worked. And just before COVID they graduated, and they were like, jason said, new contracts, more employees, 10,000 square foot space. And it was a great handoff. I felt so good for those guys. And then Covid hit us. All right, I don't know, about a year ago or so, Jason calls me and he's like, hey, can I send you a book? I got all my notes in it. He sent me his copy of profit first. I have it right here. It's full of yellow sticky notes. And I'm like, I see what you want to do here. And so Jason, Richard, and I met, and with my prior experience, know SaaS companies, especially with a coaching program like EOS, it was a natural fit for us to come together because profit, first million dollar seller, very implementable book.
[00:11:22] Speaker B: Yeah, practical. That's what I like about Mike's book.
[00:11:25] Speaker C: But like the book traction and the usis in the community, there was a huge gap because everything was paper based. So you got disconnected Google Docs, Excel spreadsheets. There's no singular platform to house the tools. So I looked at Jason and Richard, and I said, I'm all like, let's go do this.
And that's what brought us here today. We are literally a few weeks away from launching, and I think by the.
[00:12:00] Speaker B: Time this goes out, you guys will be in launch, so. And, Chris, I appreciate that.
Know, it's been probably five years since I had Mike on the show, and I think by the time this is recorded, I would have already recorded my next interview with Mike about his new book. But I want to go back because the profit first, like you said, it's actionable and it's practical. And I think that's what Gino had threaded the needle with. With traction, too, taking it from a scaling up MBA, kind of like it's over engineered to, like, we're busy scaling our companies in the business and on the business, which is always the issue.
Jason, I think you tapped in, and I want to pull a thread on it and then talk about why profit first work for you is growth. What happens is, I see, is that growth becomes such of these vanity metrics, and I always start at my presentations off. It's like we were 20 million in revenue, 115 employees. We had three locations. We did a lot of shit, and we lost 950 grand in nine. And it was the year we hit the Ink 5000. So everybody's like, go, go. And the CPA says, hey, you owe 350 grand. With what?
[00:13:06] Speaker D: Cash?
[00:13:07] Speaker B: You obviously struck a chord with me, but I want you to, because what I think is super fascinating about your experience, Jason, is that it's the real world experience of, like, it's eos, but there's this financial lens that has to be approached behind the scenes. So that way, what were the actual challenges. So everything was going good.
So we say Covid, but what mechanically happened to your business that you didn't see coming, even though you're running eos?
[00:13:35] Speaker D: Yeah, I'm a huge believer, obviously, in eos, and we structured the company, put the right people in the right seats.
I think you do get caught up in that vanity of nice space. More people, bigger everything. And deep down, it's like a duck, right? Your feet are moving a million miles an hour, but you try to be cool and calm at the surface. You know what I mean?
[00:14:06] Speaker B: Yeah.
[00:14:09] Speaker D: I think as soon as I read that book. Right.
[00:14:12] Speaker B: Well, what had happened before? Why did the book resonate with you? So when you say, Covid hit, was it, like, cash flow issue? What actually happened to the business? And the reason I say this is because cash flow is the oxygen we all need. We want salary and distributions, and then we need to fund the company, and we need to pay our taxes. At the end of the day, that's really it. But how did Covid help you see, or maybe not the ideal way help you see that or bring that to the present issue?
[00:14:41] Speaker D: I think it was just a culmination of things. I think it was. The sales pipeline wasn't as strong as it should have been, but, yeah, it's cash flow. It's what it was, right. I had 28 salaries that I had to take care of. I couldn't sleep at night. We'd lost these big contracts.
It was just awful. It was an awful feeling. You know what I mean? You got 28 families that are dependent on you. And I felt like I let them down, quite frankly.
[00:15:08] Speaker C: In our entrepreneurial world, this isn't an uncommon story. Right? When things are going great, maybe we took our eye off the scorecard, or maybe we didn't audit the scorecard to make sure we're tracking the activities that are producing the profitability. Right. Somewhere in there. But you know how it is when you're winning and things are going. We tend to get away from some of the foundational tools that keep us connected.
[00:15:41] Speaker B: Yeah, well, and I think it's like, you do the best work in the worst times and the worst work in the best times, because if everything on the income statement is going up, you don't have to look at your cash flow.
[00:15:52] Speaker D: Right.
[00:15:53] Speaker B: And I think at the end of the. It's like, yeah, let's go. Let's keep making bets. All of a sudden, the hose stops, and you're that book. When you got that book, Jason, what about that book resonated with you? And the system resonated with you. That was different than how you were managing the business or your financials prior to that.
[00:16:11] Speaker D: It resonated. The simplicity of it resonated the step by step process. Right.
It was very actionable. Right. It was very achievable. Once I read it, I was like.
I felt foolish. I was like, why haven't I not been doing this forever? Right. You know what I mean? I felt very good at what I was as an engineer and leading the company, but that piece was always missing. I never had any formal training. So, yeah, I think the simplicity of the system, the actionableness of it.
[00:16:48] Speaker B: Tell me a little bit more about your. So you're an engineer, but you just said that you didn't have any formal training in finance. What was your level of comfort with finance prior to that? And then what was your relationship with financials prior to that?
[00:17:03] Speaker D: That's a good question.
I was always comfortable with numbers, but the p and l statements, the balance sheets, I never really understood them, you know what I mean?
[00:17:15] Speaker B: Did you understand an income statement, though? Because I think a lot of entrepreneurs understand the income statement, but it's like the interplay of this.
[00:17:24] Speaker C: Yeah.
[00:17:26] Speaker D: Quite frankly, when I saw the net profitability on the income statement as being really high and I had no money in the bank, I was like, what am I missing?
I totally recognize that.
[00:17:37] Speaker C: Yeah, I know. Crazy.
[00:17:41] Speaker B: That's where in the book, when Mike talks about that, in the book. I don't know, man. It sounds like you had that experience, too. I remember sitting down with our CPA, and you brushed it. You guys did so great.
You owe the government 350 grand, and we're like, we have no money in the.
How are we going to pay that? With our good spirits.
[00:18:03] Speaker D: Yeah, that was the rock bottom for me. That's why I was like, I got to make a change here.
[00:18:08] Speaker C: I think the genius behind what Gino did, right?
He took scaling up and evolved it. Right. And he kept it simple. And I think that's the genius behind Mike, too.
Look, we are all taught sales minus expenses equals profit. And we go into know we're these crazy, wild entrepreneurs, and I got a great idea and we go do it. And we're so focused on that, and I'm not a numbers guy.
You don't want me in there, I will jack it up.
I know about being a Motorola salesman. I knew margin because that's how I got paid.
But the beauty of what Mike did was so simple. And we've all thought about it at one time or mean, my dad, entrepreneur, right? He always used to tell me, pay yourself first. You have to keep a roof over your head, food on the table for your family. He goes, pay yourself first. And then when you're doing your calculations, he goes, set your profit number and don't go below it. Like, just pay yourself. So when I got the book and I hadn't read it prior to Jason giving it to me, and when I saw the sales minus profit equals expenses, it's like simple move.
But the genius behind it is the focus. Because, like, in Jason's story and thousands of other small business owners story, they maybe not be afraid of numbers, but they don't have maybe a deeper financial acumen, or they don't have an interest because they don't like numbers or they're.
[00:20:01] Speaker B: Intimidated or like, I mean, I can't even tell you how many times Chris and Jason that I sat across from our CPA or our banker and they just would talk down to us. And whether that was perceived or it was just, it still is the way it, you know, the intimidation, all that stuff. And it's like, to your point, it looks like I did okay, but there is no money. I'm no rocket scientist, but that doesn't make any sense to me.
[00:20:32] Speaker C: Look, I'll show an act of vulnerability here for your listeners, right? Because it's through all these entrepreneurial pains that we want to share these experiences so the next man or woman entrepreneur can learn from it, right?
I told you guys in my first company, I targeted trek bicycle stores, right? Without their permission. I just started going after them, and then I got their attention. And so the next thing I know, me and my partner have a meeting with the owners. Now, the owner is, let's see, he was second gen, and we're like, oh, cool, trucks wants to talk to know. We're like young, naive business owners. And we get into this massive boardroom. Now, I had been in big boardrooms before, Ford and Honda and all that, so I was comfortable. But what was weird was my partner are sitting there, and about twelve people roll in. Nobody introduces themselves. And then the owner and another person come in after those people and they go to the opposite end of the table, sit down, and they start the meeting. And no joke, you guys, I'm not even like five minutes into my pitch or whatever, and the guy sitting next to the owner says to me, hey, Chris, excuse me. I go, yeah, Jeff, how can I help you? And he's like, hey, what's your last three years? Ebitda? And I said, hey, Jeff, you know what? I didn't come prepared to share that vital information with you today, but should today go well, we can always go to phase two and we can have that conversation, right? I'm a professional salesman. Right? You guys, I walked out of that meeting with thick, stomach shaking knees. I didn't know what EBITDA is. I called my accountant. I'm like, hey, what's this ebitda do thing?
[00:22:28] Speaker B: And blah, blah, blah.
[00:22:30] Speaker C: So my CPA tells me, and I say, okay, now this is where it was a pivot for me. Kind of like Jason's pivot with the book. This issue was mine, and I needed to rectify it. I don't like numbers. Right? The intimidation on it. I'm not good at math, but if I'm going to be a business owner, I need to understand the finance 101, right? So I had her make me a glossary of terms. Top ten accounting, furniture, small bit. And that's how I started to build my financial acumen. But it's a horrible Quebec. Just bring the circle full. It's a horrible feeling. I know when it hits you, whether, and then to Jason's point, you feel like a failure. You're like, oh, my is. And then you got nothing.
[00:23:18] Speaker B: Well, then it's like, it's even more difficult to figure out who to trust if you don't.
[00:23:22] Speaker C: Well, that's the next.
Again, coming back to Jason sending me that book, it was like, it's the same reaction I had when I read traction. I'm like, this is simple, practical, and executable.
[00:23:39] Speaker D: Let's help.
[00:23:40] Speaker B: A and what I want to do is I want to tee up Jason then to explain what you did and how you implemented profit first. And then we'll kind of get into how the tool is going to be actionable, too. But before I do so, I think what's important for the listeners and us three talked about this on our prep call, is that when I think about profit first and where it fits into where Arcona and intentional growth fit in, is that we are helping people on the big picture of what are companies worth, how do valuations work, how to actually scale the equity growth and more the EBITDA, like you're talking about, Chris, and knowing that, kind of like the m a kind of bigger picture. And then with our dashboard, what we've realized is that our dashboard is for people that have really decently clean financials, have a pretty decent grasp on this stuff, and then want to take it from, they can say, hey, we're a half a million or a million in EBITDA. We want to go to two or three. But what I've realized over this last two years is that's like not a big chunk of the market. And then so many people can do so much really quick implementation and really practical moving of the needle with profit first because they can get a handle on this stuff and start paying yourself first. Start having enough for distribution, start having enough for taxes. Where I think it's just helpful because I don't believe that there's any competition because of how you guys are positioned in what we're doing. And so many times people come to us and they want what we have and they can't afford us. You know what I mean? Because they can't even. How many times I'm like, well, are you paying yourself enough? No. Well, not only you're not paying yourself enough, but then you're going to pay us. So then there's a sequence of events that need to happen first for them to get a handle on it. And so, Jason, when you dealt with it in 2020, what systems and how did you apply profit first to actually get to the point where you took that plane and you pulled it out of the wrong direction? Nosedive, I don't want to say nosedive in it because I don't know if that's exactly what it was, but you just changed the trajectory.
[00:25:50] Speaker C: A precipitous fall in a short amount of time.
[00:25:53] Speaker B: There you go. Well, different way of saying it.
[00:25:56] Speaker D: Yeah. I think I implemented the basics of the system, right? So the center of the system is around bank balance accounting, right? So it strips away the P L and all that stuff and brings it down to the bank accounts. Right. And so just taking that first step, right, opening up a profit bank account, right. Opening up that tax bank account, opening up the owner's pay bank account, and just taking those first steps. And then a lot of people that, because I'm a profit first coach, right? So I coach people. A lot of people get super excited and they get too aggressive, and I did the same thing. I'm like, I'm going to set my profit to 10%. And immediately we just started failing. Right.
[00:26:42] Speaker B: Why is that?
[00:26:43] Speaker D: Everybody against that, right? Take your time. The beauty of the system is you're going to make incremental changes over time to get.
[00:26:51] Speaker B: Why was your 10% too aggressive, jason?
[00:26:53] Speaker D: Because we weren't profitable at the time. So I went straight from, you're a $3 million business, right? And all of a sudden you go from not making money to, how am I going to make simple? But it's not easy. And what I mean by that is if you implement the system, you're going to go and it's going to get to a point where it's uncomfortable. Right. You got to make difficult decisions. Right. A trade off sample is we went from 28 employees to 14.
Right.
[00:27:31] Speaker B: It was good for you, man.
[00:27:32] Speaker D: Right.
And our revenue only dipped about 14%. So it tells you how bloated we were. Right.
So when you start implementing the system, it gets to a point where it is really hard to make, but the decisions are black and white in front of you. You can't afford this many people. You know what I mean?
[00:27:56] Speaker B: Yeah, I love that, jason. And props to you, man, because I've been there, dude. And it just, because I think it's.
Tell me about how did you handle that? Because the pride and the ego is such a bitch when you're trying to go through that. So how did you handle that mentally and then how did the system help you deal with that?
[00:28:27] Speaker D: It was difficult. Right. And I'll tell you the most difficult person. So I have a senior leadership team.
[00:28:33] Speaker C: Right.
[00:28:34] Speaker D: And there was five of us on the team, and we're very transparent with the books, you know what I mean? And so one of the worst, it was a couple of them, but one of the people on my senior leadership team saw the bank accounts, saw what was happening, and he came to me, he goes, I realized we can't afford me. Right. And it was very emotional. Right. You know what I mean? And he was right.
He was right. So in that one case, as a leader, I felt like it was awful. Right. And he wound up leaving, and I actually saw him last night for a beer, and we're still great friends and stuff like that, but that's the black and whiteness. Right. It just puts it in front of you. Right. And. And it forces you to make these tough decisions, you know?
[00:29:33] Speaker B: I think it's so helpful, man, because, like, this is real life, and I think. And I think we have trade offs that we have to make. And I think for a long time, people, it's been pretty easy with 0% money for 14 years, and things went up to the right, and now it's like, we have trade offs. Like, okay, well, we have to save the machine of the company and we have trade offs, and the trade offs are hard, but then when you get out of them and you stay focused, then there's a lot of good on the other side. And I think that's where I say the profit first and the way of eliminating intimidation, getting people to actually make those moves that are really hard, because so many times, and this is where, I don't know if you guys experience this, but you sit down in front of a CPA or banker, all that hard stuff that you have to deal with, we don't need more shame and guilt, you know what I mean?
We got to deal with it anyways. And I think what's so cool is that it's like, okay, now there's a practical way to deal with those hard trade offs and to give you confidence that you're making. Right. Hard.
[00:30:41] Speaker C: Right, right. I think that in my observation of Jason and Richard is that's one of the things it did. I know it did for Jason. It's like, okay, he's an engineer, he likes things in order. And it's easy. He set up the bank accounts. But it took, what, 1824 months, Jason, to turn the tides, right? Follow the methodology, the principles. Yeah.
The thing that I think that I want to say, and it's like in relation to eos or any operating system or what we're talking about here with profit first, is when you're in that situation and you're embarrassed and you have a layoff and you're just like, shit. It's just shit every day. But you're the leader, and all eyes are on you, and you've got to stand up and lead, right? Because that's when we find out what kind of leader you are in the roughest times.
I don't want to embarrass.
He was him and Richard recognized. They scaled their business to a certain point, but they needed some help. Great. Bring in an operating system that helped them scale to what they were getting at, right. Maybe somewhere we missed it on the scorecard, we got the wrong KPIs, or there was a miss. The beauty of it is, and this is what the really confident, smart entrepreneurs do, is, yeah, it sucks. And guess what? It's my fault.
[00:32:15] Speaker B: Their responsibility.
[00:32:18] Speaker C: Now I'm going to do something about it. And the resource of the profit first book is amazing, just like all the other simple, practical business books. But this profit first book, you literally, if you're open and honest with yourself, and you get past all the emotions, and now you're ready to find something to execute, right, something to fix the problem.
And they did it. They stuck to it. I think that's the discipline that that book, that methodology brings. Like it's proven process. Start with these five accounts and start depositing your money following the process, but you got to stick with it.
You have to stick with it. That discipline has to be there. But let me tell you, we've all three have been in this boat, and I'm sure plenty of our listeners have been in this boat. If you stay confident, that's one of the major traits of the high performing, really business owners. Right. There's a high level of confidence when everything else around them is nuts.
[00:33:29] Speaker B: That.
[00:33:29] Speaker C: Take that. But then it's backed by the discipline. The discipline. Because just like in any operating system, when you start, you have to give it blind faith.
You have to just give it blind faith. And that's what Jason did.
He got, all right, this is it. I'm going to follow it and we're going to give it our all. We're not going to get distracted. And here we are, 1820 months later. It's like, hey, it worked.
[00:33:57] Speaker B: So, Jason, I love that. Chris. And to pull on the thread of what you just said, chris, is Jason, for the listeners in, because the blind faith part is important is, you know, I've always struggled with, how do you get someone to take action when they're not eating shit? You know what?
Like, let's avoid having the fall. Like Chris said, what are your thoughts or comments or suggestions to people to take the blind faith in a time where they might not need to?
[00:34:35] Speaker D: Yeah, I think the journey starts with the first step, right. And I think it's as simple as taking that first step. Right. And opening up those bank accounts and reading the book. I mean, I read it like four times, you know what I mean? And you got to absorb it. And every time I read it, I learned a little something different. But it does. It takes that blind faith. You got to take that first step. And discipline is a huge part. I I'm mean, glad you brought that up, Chris, because what will happen is you have these bank accounts and you have money going into your profit account and your expenses start to squeeze. Like every bit of you wants to say, slide some money out of that.
[00:35:16] Speaker B: Profit.
[00:35:21] Speaker D: At first, like when I was.
[00:35:24] Speaker B: Looking at Jason, when I was looking at my tax account, continue to grow with cash while we're just like, that's not mine and it's right there.
[00:35:35] Speaker D: So it does, it takes a real discipline, and that's when it helps to have a coach or somebody helping you along. Accountability.
[00:35:47] Speaker B: How does this translate to then, what's the market opportunity that you see with this platform, you guys? Because obviously you've done this before, Chris with Eos and 90 IO. So, Jason, why'd you end up calling Chris up? And what's your vision, where you're headed?
[00:36:04] Speaker D: So where it started was, it was so impactful on my life that I became a coach, and I really wanted to help others. Right. I knew there were so many people out there that were just like me, that were good at what they did, that they just needed that extra help. Right. And so I started coaching people and helping people, and it feels great, right? I mean, that's what we love about being involved with the entrepreneurs. But I only have so much capacity, right? So I can only help so many people. And my background, as I started doing this, I was dealing with excel sheets. I was talking to, there's like four or 500 other coaches out there. Everybody's, it's just disjointed. And so I'm a tech guy, so this thing back in my head saying, hey, there's an opportunity here. And so we just kind of moved on it. And I know with Chris's experience with 90 IO, I called him up, we had lunch, and, yeah, he was the perfect fit. And I feel very blessed, very thankful to have Chris and Richard on my team. I think we are a great, complimentary team, but, yeah, so we just, hey, it's not enough to just read the book. It really isn't. You need somebody to help you, and this software is that next step. The profit pro software is there. If you read that book, use this software. And the goal is to help all those people out there, all those small businesses that maybe can't afford a coach, right. Maybe they just don't have it, but use the software. Read the.
[00:37:37] Speaker B: That. I love it. Jason, I want, Chrissy, maybe you to describe a little bit more in depth what the tool does. But I think I want to insert in one of the topics we talked about on our prep call was, so one of the problems that I see in small businesses and this kind of Pareto principle of small companies that go into the bigger size, privately held companies, is that 95% of companies are below 5 million in revenue. And one of the biggest challenges that I see, and we talked about this, where if we were to put some language behind what does hitting the ceiling mean in the financial terms? And then also one of the biggest dysfunctions, I think what happens with EOS without the financial lens is entrepreneurs get these blind recommendations of just blank hire someone, just put in the earpiece, just whatever the hell it might be. And in the back of their mind, what I've been here and I've watched hundreds of entrepreneurs deal with this. Then they're sitting there going, I'm finally making 200 grand. And you just said, just bought. And then it just takes away from their personal income. So there's no way for them to see this path, even though they might absolutely 100% get why they should invest in whatever the heck is being discussed. The reality is they don't have enough cash to do it. And I see the insert, profit first insert the system that you guys are putting in so that way they can get on the other hump of this cash flow.
[00:39:00] Speaker C: That's right.
Yes. It's SAS software. Right. We've taken the tools, the foundational tools of profit first, and we digitize them. Right. We have a singular platform, so the end users and their teams all have access. But then if they do hire a coach, the coach has access. It helps the coach do their job better. Right.
But what we want to do is we just want to make it fun and easy to do business with. Profit pro. And to Jason's point, the profit first methodology is simple, practical, and it works.
Jason's one of how many case studies that are out there. The book came out in 2014, I believe. So what profit pro app does is bridge the gap from the book to bring technology in. Right. So that we can have a seamless interface. But the idea is, you mentioned earlier that experience. Right, well, we don't want any dips in the experience. The software is going to take you.
Right. The steps that Jason had to follow going back to the book every time.
And it just is going to make the manual profit first, quick start, easier, seamless following, and then easier to communicate.
[00:40:30] Speaker B: With a coach or with anybody else that's around you.
[00:40:32] Speaker C: So that way, communication.
And we have the foundational tools of what Jason used. Profit first. But then, of course, we're all technologists and we've expanded the toolbox. So you're actually getting a little bit more than just the foundational tools and profit first. But let me say, it starts there. It starts like Jason said, that first step is when you download the software, there is a little bit of work to do, right. You got to set it up. And we have white glove service to help them do that.
We want a frictionless experience, and that's where we're focused. But the second piece of this, you guys, is because I don't like numbers. Jason's not a big fan either. We don't pay attention. We want to educate the small business owner, too. Kind of like my top ten finance thing that mike. We want.
I'm going to be living that one for a while. But it is funny. But the thing is, so one, we fill the technological gap, but we now are going to have a user experience of getting you on boarded, right. And then getting you set up, and then we're there.
Whether you hire a profit first coach or if you don't have a coach, we work and hold their hand to make it a good experience.
And getting that first step, it's hard for them. Right. We talked about this emotional feeling we have when we're in this position, and we have to be cognizant of that when we're talking to these business owners like, hey, we've been in your shoes. We've been in your place. We know because we're entrepreneurial business.
[00:42:41] Speaker B: Part of, part of that, Chris, too, is like, and this is why I think Arcona has succeeded, too, is that it's this entrepreneur to entrepreneur, you know, what is necessary to know and not know and how to communicate debits and credits. We don't give a shit about debits and credits. Someone else should do that. What I need to know is, if I make this decision, do I have enough money to pay myself and pay payroll in three weeks?
[00:43:07] Speaker C: I remember saying to my accountant, I didn't want to get overwhelmed with because I did little training sessions with her. But I said, listen, it's real simple. This is what I want. I want to keep my fingers on the pulse of the financial segment of my company, and I only want to look at a handful of numbers you can't come at me with.
[00:43:36] Speaker B: You know what's really fascinating? I just got done doing a podcast with a bank, a commercial banker. That was a lot of fun. It was like an hour and a half, and he's a banker inside of a big family office. So he's not singing. Why I think that's important is because he's not singing this song of, like, everything's fine and it's no like he was speaking the truth of how the financial system works. And what he said that's relevant to what you just said, chris, is the balance sheet. He goes, start with the balance sheet first. He goes, if you want to work with your banker in a better way, put the balance sheet in the first page, not the income statement. So if I think about what you're doing and even what he said, how we're shifting, this is the income statement is important for how you're going to scale your business. But then if you guys start with the balance sheet, you're helping people accumulate more cash for themselves, for their taxes, and to fund the growth of the company. So you guys bring that balance you're helping do. What he said is the first important thing where we then fit in is like, we then take that cash flow statement, which is even more complicated, and we project that cash flow statement out to the valuation, which is you can't do it unless you can't mathematically. You cannot have a cash flow statement unless your balance sheet is correct.
We get to be able to come to us from, like, you need so much work before you can even come to us. And I think it's so cool what you guys are doing because you're making it.
[00:45:07] Speaker C: They're, you mentioned what's the know, Jason, Richard and I want to put profit pro within reach of every small business owner worldwide. Right. That's the bhag. Because we know, the three of us being small business owners, we've all rode the roller coaster, and that's what we're passionate about. We want to go educate them. We want to help them get started. Here's the book. Got to read the book right now. Here's the tool to implement the book.
[00:45:47] Speaker B: And then even more even accessible to get the.
[00:45:50] Speaker C: You guys know the stats.
Ryan, you're in the financial. I don't know what the latest stat is, what, 90% of startups fail in the first three years, whatever that number is.
[00:46:01] Speaker B: There's that, Chris. But I think what's even more interesting, because I don't play in the startup space, and we know that a lot of those startups fail, but it's this US Census bureau data that I keep relying on, which is, out of 6 million privately held companies that have employees, 95% of them are below 5 million in revenue. And I think it's because of this income cash flow issue.
What's so crazy is most often, unless there's different business models out there, they can't afford any help because they are not paying themselves.
If you can make that accessible, you have a whole market. That's huge.
[00:46:42] Speaker C: Mike's philosophy, he's nailed it, and he encapsulated it in this book. And that's our passion. The data that you just shared. Right. We can help them. Imagine, you guys, if we could push the needle, 1% on those numbers, 2%.
[00:47:05] Speaker B: Chris, you know what's super important is on the call with the banker. You guys, I said, they talk about this $10 trillion baby boomer, well, tsunami. And I actually am truly curious. I'm waiting for someone to tell me I'm wrong. Is I'm going what? Well, tsunami. We have 95% of companies where they have jobs, where they're making 1200 couple hundred grand and there's not enough cash flow to afford the buyout and to afford their retirement. So we need to have people like your system. If we can have that whole cohort generate more cash flow.
[00:47:42] Speaker C: That's right.
[00:47:43] Speaker B: I mean, that's an insane possibility and they're going to have to do it themselves. But they need help through education.
[00:47:50] Speaker C: It's got to be affordable, right? Exactly. Earlier, they can't afford it. So we've positioned profit pro to be affordable.
$99 a month is the most popular of our three tiers, but that's what we want. We want to go change that data because our passion is small. Just like you.
[00:48:19] Speaker B: Chris, because people come to me like, hey, we need help. And I'm like, well, it's a few grand a month. They're like, what?
[00:48:24] Speaker C: Exactly?
[00:48:25] Speaker B: We're only helping. There's the people that want to make that investment or can afford it, otherwise they have to go do the training, then do all of it themselves. But I love it, guys, because again, thank you. Yeah, that's so cool. Jason, how is it doing this and running a business? You got an integrator running the company and it's all, how are you balancing?
[00:48:48] Speaker D: So I'm very thankful that implementing us, implementing profit first, the other big book that's been influencing my life is the great game of business. So implementing those three things gave me the opportunity to be able to step out of the day to day operations of my engineering company and it just gave me the opportunity to do what we're doing and I'm passionate about it. I love what we're doing. I love the team, I love the product.
I can't get out there fast enough for me.
[00:49:22] Speaker C: Really?
[00:49:23] Speaker B: That's awesome, you guys. This has been an absolute blast. Time went fast. What is the best place for people to find profit pro and your guys'contact information follow you guys, what's the best place?
[00:49:37] Speaker D: So the best place is our website. It's profitpro app.
You can check out the tools and software and you get signed up for a 30 day free trial. But that's the best place for sure.
[00:49:51] Speaker C: Yeah, we're on LinkedIn, Instagram, Facebook, all the cool places.
[00:49:56] Speaker B: Anything that I didn't ask that I should have before we wrap up.
[00:50:00] Speaker C: Oh, that's a great.
I can't. I looked at the clock and I'm like, what? Yeah, it's twelve four.
No, I thought it was great. I think you guided us really well, and I love the interplay with your company and our company.
[00:50:25] Speaker D: Yes, absolutely.
[00:50:27] Speaker C: I don't know if that's a separate conversation or if there's anything there, but like, because if we can get them going and we get that bucket fill. Let me introduce you to Ryan.
[00:50:39] Speaker B: Well, and I think it's a natural progression as the listeners are hearing this.
One of my missions too, is to help them understand what order should they be thinking about things, right? Instead of going like, okay, I've got EOS profit first.
[00:50:54] Speaker C: Intentional.
[00:50:58] Speaker B: I think going and reaching out to your guys'website, and then picking up the book. Then people can start to kind of navigate those different pieces. You guys, thank you so much for coming on the show.
[00:51:09] Speaker C: Thank you.
[00:51:10] Speaker D: It's been a great time. Appreciate it.
[00:51:15] Speaker B: Thanks for listening into that conversation. I hope you found the time valuable. If you enjoyed the conversation, please leave the show. A review on your podcast player. We're constantly trying to up those reviews. It helps a lot with the visibility and if you didn't catch the commercial in the middle of that episode, there's two different ways that we can help you. One is if you want that kind of clarity. We have a coaching program that is based on the five intention growth principles and uses the material to help you get that kind of clarity on your target, equity valuation and income that you need on the way towards that valuation, what you want from the business long term and why, and then how to get aligned with your leadership and your partners. So that way everybody's working in the right direction to get you what you want. And the second way is if you want to jump right into the data and you want to actually build out your financial roadmap with your three statements and tie your financials and your operational data to that target equity valuation. My team offers a complimentary financial assessment. Either way, all you have to do is go use the link in the show notes below, schedule a discovery call with me. We can walk through your situation, figure out if there's a fit or not, and if not, I can point you in the right direction. Thanks everybody for tuning in and I hope you enjoyed this episode and I will see you next week.
