Ep 319: Creating Your Bolt On Business Acquisition Strategy with Marty M. Fahncke

Did you know you can achieve a far better ROI on your marketing budget and rolling that marketing budget into an acquisition and using the term growth by acquisition to build a portfolio of great businesses just using your marketing budget?

Hi, I'm Jaryd Krause. I'm the host of the Buying Online Businesses podcast. Today I'm speaking with Marty Fornke who is a seasoned world-class marketer with over 30 years of experience in growing and scaling businesses.

And he's also got over two decades of experience in mergers and acquisitions. And in that time, Marty's health businesses scale to over a billion dollars in revenue. And he's also executed over 450 million in mergers and acquisition, acquisition transactions.

In this pod, Marty and I break down who he helps acquire businesses, what size businesses, and what type of businesses are in the online business space. We also talk about not just acquiring businesses, but also about selling businesses, where sellers go wrong, and what sort of lead time they need before they should sell their business.

What happens the moment that they think they could sell their business and they get a little bit of a price why that be a slippery slope and a fast decline in their business and what they should be doing about that? We also talk about the whole acquisition strategy and how to acquire multiple businesses.

We talk about how to build out a strategy for the business that you want to buy as a bolt-on to your primary business what that should look like, how to go and find that business, acquire that business, and all the steps to get there.

We also talk about financing. We also talk about the leaky bucket syndrome again, and Marty shares his advice on how to resolve your leaky bucket and how people typically can save a thousand dollars a month by just doing this process.

And business owners who do this process can save up to $10,000 a month, sometimes more depending on their business and their finances. Marty's got so much experience in the online business space, in marketing, and sales, and he's built out a great team in the mergers and acquisitions process. And we also talk about like how he sells businesses for people and his success and results in doing so.

Yeah, there's so much in this if you want to build out a portfolio of businesses and grow by acquisition, this is such a valuable podcast. You guys will certainly love it.

Let’s dive in, and enjoy.

Hey Marty. Welcome to the Buying Online Business Podcast. Thanks for your time.

Glad to be here, Jaryd. Thanks for inviting me.

Yeah, I'm excited. You mentioned just before we got on, starting to talk business straight away as we typically do, you mentioned a portion of your business, 60 % of your business is international. So what I wanted to ask, what sort of like, businesses do you, like how do you work as an advisor? Are you mostly on the sales side, are you mostly on the buyer side and what sort of businesses that, you know, what's your market?

We primarily are sell-side, although we do buy-side services primarily for entities that are looking to do roll-ups or strategic acquisitions. Our focus is on transferable businesses. So that will be e-commerce, SAS agencies, like marketing agencies, publishing membership, and affiliates, which is a space where we do a lot of work in transactions.

And because of that transferability borders are less important to, you know, a buyer and a seller. And so we've just found this niche in the ability to execute acquisition transactions across borders. And it's turned out to be quite a great category for us. And we've helped a lot of companies accomplish an acquisition.

Congrats. And so you're mostly on the sell side, right? You said? Yeah. And on the sell side, when you talk about roll-ups, just for people listening, rolling up, like are you gathering the portfolio of businesses and selling it as a package? So you mean by roll-ups?

No, on the buy side, we have clients who execute roll-ups, and they engage us to find them opportunities to put into their portfolios. On the sell side, we have sold several digital businesses to companies that are also doing roll-ups.

Cool, awesome. And what sort of price range are we talking about? Are we talking, about average?

Focus on businesses in a valuation range between 1 and 10 million dollars.

Cool, cool, awesome. Yeah, that's great. The list is going to be happy with that. That's where they typically people are starting around just under the 500k range and their goal is to get into that lower market or they call it small, medium enterprise business. I'm excited to dive into that.

So when with your bias, let's talk about buy-side clients. Typically what does it, can you give us an example of somebody who has maybe acquired a million-dollar business, maybe it's that platform business and they use that as an SPV. Then how do you go away and acquire multiple businesses for them?

What does that look like in terms of what sort of businesses you target, how and why financing? And this is like a full discussion you have to answer that in one sentence, but what does that look like? Do you have any examples?

Everybody's in a different position, right? So sometimes we're engaged to bring on like e-commerce is a prime example where we'll have a platform client who has a pretty robust e-commerce business as a standalone.

And they're looking for more e-commerce business to bring on and put into their portfolio because they already have the economies of scale and they can take a marginally profitable marginally successful e-commerce business, maybe doing a couple million in turnover and is maybe at 15, 18, 20 % profit and they can plug that business into their system and turn it into twice that size at 25 % profit.

So in that case, they're looking for a very specific set of identifiers that they're looking to plug into an already existing model. Other of our clients are looking more for strategic or ancillary providers. So a marketing agency may be looking for SaaS tools that they can convert their current retainer-based client services over to more subscription-based software services, which not only increases revenue and profitability but also increases the overall entity valuation at some time when they want to exit.

So give them other things that they can provide automatic recurring billing and additional services to their current current. And then we've had the recent transaction was a marketing agency client who is looking to acquire other marketing agencies. Again, looking for that economies of scale. It's a lot.

These are business owners who understand that to maybe double or triple the size of their business, they either have to go out and sell two or three times more services or they can just buy the business, right? Buy the book of business, buy those clients, buy the infrastructure to service clients, and instantly increase their business and, you know, again, get those economies of scale. Acquiring a business can be substantially lower risk and higher profit than trying to go and secure that business on your own.

Grow a business, rapidly, you're likely to spend a lot more money on marketing. It's going to be less efficient, right? You're probably going to, your customer acquisition cost is probably going to be higher. You may have to hire more additional staff, staff, staff. That's an investment you got to put in there.

You have to put investment into advertising, whether it's Meta or Google or something like that. So it can be very expensive to grow your business and you don't know if any of all of that's going to work.

But if you do an acquisition, especially a bolt-on acquisition that's either maybe acquired by one of your competitors or somebody that's in your vertical, you have an existing track record of that business. You know that they're already consistently generating that revenue and that profit, and it's a much lower risk.

And usually the investment's lower as well. So we have a lot of clients that understand that and bring us on to kind of be their acquisitions division and continue to look for businesses to bring them.

So the other way you explain that, buying the business itself is you've already got the ROI if it's standalone, then like the bonus, massive bonuses is bolting it on, know, emerging it in or running semi-parallel.

The way I like to explain it is very similar to you is that you can have a marketing budget to grow your business and you can pour that into meta ads or Google ads. But what you're doing when you're starting ad camp buying data and it costs you a lot of time and money to work out what ads work and land before you find the one that can scale.

And that might take six months and 150 grand or 200 grand when you could put 200K or 500K into an acquisition using an SBA loan and acquire your competitor or somebody that's parallel to you. Right.

Great strategy, growth by…

Well, you talk about SBA loans. Mean, my gosh, that's one of the best tools in the United States. We can't use them for international deals. In the United States, yeah, you could take that same $200,000 and you can buy a $2 million business that's generating $700,000, $800,000 in EBITDA, and instantly cash flow.

Yeah, it's a fantastic program and it's almost a no-brainer, right? Go spend that money and gamble it or spend it on almost guaranteed cash flow, I don't know why more business owners don't do this.

Yeah. And you know, the way I like to think about it as well is like when people buy based on trust and they also say that once you've, you know, you've already got the cost of the best customer you've got is somebody that's already bought from you because I already trust you.

And again, it's typically spending more money. So if you go away and you're trying to push people from cold, not knowing who you are to trust you and purchase your products through ads, buying a business where they've already bought from that business previously is already trust there and then you can merge them and the chance of them continuing and you increasing your customer lifetime value through multiple products is high.

You mentioned financing. Yeah. SVA is great for people in the States, but what do you guys do with clients internationally? You know, raising funds, do you help them raise funds or, you know, refer them to people that can help them get funds? What does that look like?

We refer them to people who can fund deals. There are other SBA-like programs in other countries. Canada in particular has BDC, which is an option. The UK has some funding options. For the most part, though, international transactions tend to be self-funded.

Meann, usually it's a company that's got cash and those transactions tend to not have a whole lot of third-party lending sources to them. We will sometimes have a minority lender in place, maybe that's doing 30 or 40 % of the transaction, which may be a revenue-based funding or asset-based funding, something like that that comes along and chips in part of it. But the majority is generally going to come from the buyer's cash reserves on those international deals.

Yeah, cool. What's the Canadian one BBC, BBC you said and then what's the UK one?

Have to look that up. You asked me I couldn't think of the initials but there I'll have to look that up and I'll get on.

That's fine. And when you say, you know, maybe 30 % of the deal funding international revenue based, where's that funding typically coming from? Is it just friends and family or is it just… Yeah.

To some degree, friends and family are one of the factors, but usually, it's going to be a third-party financing company that's versed in international financing for acquisition deals. There are a few of them out there. There used to be a lot more a couple of years ago. There are far fewer today than there were two or three years ago.

There are still some out there that will fund a minority debt position in acquisition deals. Interesting on the friends and family thing though, there is no discounting the value of a rich uncle. We've seen a lot of those come along where a family member has come along and financed the deal. So keep those family relationships friendly because you never know when you might need to make a call.

Definitely and a rich uncle just wants to help his niece and nephews right now if he's rich, know, or rich auntie why not like, you know help everybody out So love it. Thanks for that. I want to ask about where people go wrong. Like where do people mostly go wrong when they're trying to grow by acquisition?

Where do people go wrong when they try to grow by acquisition? The first and most critical area I see people going wrong is when they try to use the acquisition to fix existing problems in their business. And that is the biggest mistake you can make. If you're going to grow by acquisition, you need to make sure that your existing business, your core business is rock solid, that you have excellent operational procedures have an excellent team in place that your cash flow is strong, and that your financials are in place.

Everything is running solid. I see many times when a business is a little shaky. And so an owner gets, you know, here's somebody on a podcast talking about growing through acquisition and goes, that's my solution. I'll go buy another company and put it on top of this. And the extra cash flow and profit will solve all my problems. And it doesn't, it just magnifies the problems.

Don't go out and try and grow through acquisition unless your core business is already very strong, very stable and it's a foundation, right? When you build up a building, you put a strong foundation and then you go up from there. Your core business needs to have that strong foundation as well.

Love that. Thank you for that explanation. I call that a similar philosophy the leaky bucket syndrome. Somebody that wants to buy a business as their first business and they want to go and get acquired with cash. We'll talk about financing secondly, but if they're trying to save money to acquire a cash business and they're not able to save money because they don't know where all their expenses are in their own life, when they buy a business, the same thing's going to happen because they're operating the business.

And then if you've got leaks, you know, though, you know, where you don't know where your money's going in your personal life and all this expenditure into entertainment expenses. And you try and save the cash to buy the business and you buy the business, even though there's some leaks, the more money you put into that bucket, the more, more it's going to leak out, especially when you got multiple assets and multiple things going. And then if you add finance into it, like if…

Debt service magnifies that.

It magnifies it, right? Because yeah, the pressure, know, the more pressure on something into a leaky bucket, I used to be a plumber, so the faster it will go out, right? Like it's just, and then the same with you going from one acquisition to multiple bolt-ons, it can be scary.

Yeah. You mentioned the leaky bucket. Think, can I give a piece of advice that's not acquisitions related, it's a hugely valuable piece of advice. Okay. In your finances, take one hour and if your finances are controlled only by you or then do it by yourself or if your spouse or significant others are involved, take one hour and go through every single one of your credit card, debit card, and bank statements and look for unnecessary recurring charges.

When I give people this advice, the average individual couple or family that does this finds over $1,000 in savings just by taking one hour to do this. If you're a business owner, do the same thing. The average business owner that I tell this to, one hour, one hour, pull all your team together in this and go through every, who's, what's this charge? Why do we need it? Who's paying for it? Is this the right level of service that we're paying for?

And you know, could we get rid of this or go to a lower level of service? $10,000 is the average savings that a business owner does with one hour of just doing that one action. That is a weak bucket. Yeah. In one fell swoop. No, in one that's, that's out the door. $10,000. The average business dollars per year or are you talking about $10,000 per month they're saving?

I'm talking about, yeah, in one sitting, they will save $10,000. They'll annualize that. It's 120,000 if you do that. Well, I mean, it's, if they were monthly charges, but it's about $10,000 in instant savings. Generally, when a business owner does this, it's a wild exercise,e and then sit down and do it twice a year, every six months, sit down and do this exercise. It's crazy how much we're spending on subscriptions.

Now it's funny because I sell a lot of subscription business and that's how we all make our livelihood. But at the same time, like we are all paying for subscriptions. We either aren't using or we're underutilizing personally and professionally and it's the ultimate leaky bucket. And anyway, just a little side note that's not acquisitions.

No, this is, I haven't, I'm glad that you brought that up because I haven't mentioned that in maybe seven years, maybe six or seven, maybe eight years. I used to teach this on almost all of my business strategy calls with people who wanted to work with me when I had enough time to do one-on-one coaching. And I would work with construction workers and construction workers were able to save anywhere from 5,000 to $30,000 a year that they did not realize. Right.

If you're able to save 20 grand and you do that over two years, you can buy a business.

That's a substantial amount of money in any realm. Yeah.

And also these expenses are typically entertainment expenses. The reason you forget them is because they're non-serving, right? And they're not providing you with an ROI. So you not only cut out the expenses, but you clean up certain energy being leaked out to different things in your life that are not beneficial for you.

Yep. Yeah. Totally on a tangent there, but it's a valuable tangent. Know, I own several businesses, own stakes in several businesses, over 20 different entities. And that's an exercise that every business that I own equity in, I am forced to do at least twice a year. I mean, it's probably close to a million dollars a year in savings across all of them. I mean, it's just, and even when you're watching those things carefully, they just creep up. It's pretty fascinating.

Yeah, I love it. Yeah. A bit of a side tangent, but so valuable and so perfect for it. Thank you for bringing that up, Marty. Absolutely. Now growth by acquisition, somebody comes to you and they've got a business. Where do you, so obviously you'd build out a bit of a strategy.

What does that sort of look like? And then where do you go to find that specific business? Because each business that somebody is going to want to buy as a bolt-on and merge or do a roll-up, is going to need to be pretty specific, right?

So what is the, I mean, the more specific typically the better the ROI is going to be. So what does a strategy look like building out a bit of a strategy look like? And then where do you find these? How do you search?

Strategy is the key word. That's where you start. What is the strategy? What are we trying to accomplish with a growth-by-acquisition plan? So are we looking for a top-line increase or a bottom-line increase?

Sometimes we've done projects where it's human talent, especially with SaaS businesses. It's really hard to hire good engineers. And so we've done acquisitions primarily to acquire the engineers, the engineering team. So everybody has a different reason for doing a strategic acquisition.

And so we start with that. What's the strategy? What are we trying to accomplish? Sometimes it's a company that is looking to do a pretty rapid growth strategy and be acquired by a PE firm three years down the road. And sometimes it's somebody who's wanting to bolt on ancillary businesses just to round out their service offerings, but it's a family business they never intend to sell.

Those are two very different types of businesses that you might be looking for in your acquisition strategy. So that's the core part is figuring out what is the strategy, what is the client trying to accomplish, and then helping them to work through that and then identifying, okay, based on that, here's the type of businesses that make sense.

And so then we create a very finite box of exactly who makes sense for an acquisition in that. And then we go out and start to look for them. Booth market deals and off-market deals. On market, they're already for sale, they're on the market, they're available already, and we look through those, because I mean, they're there, we may as well look through them.

You know, sometimes they work, sometimes they don't. And then off-market deals, we have various databases of, where we can put in the criteria we're looking for. And then it's a cold call game. We reach out through email, LinkedIn, phone calls, direct mail, all those different methods to say, hey, are you interested in being acquired?

We're representing a firm that's looking for a business just like yours because we are an intermediary, it's a little easier for us to do, and our clients generally tend to be anonymous, which can be an advantage. And then sometimes if they're a well-known company or if they're, if people believe they have really deep pockets, they immediately go on and they raise their price and everything else.

Where if we keep it anonymous, it tends to keep them a little bit more realistic. Yeah. But it's outreach and then it's communication. And then from there, it's analyzing the opportunity and then crafting the deal structure and the offer and what that looks like.

And, know, whether it's cash, whether it's equity, sometimes founders are excited about being a part of the roll-up because they may be giving 100 % of their business up to another entity, but they're gonna retain say 15 % of something that's 20 times larger, right? So the math can work out.

And what the vision is, again, it's gotta match the strategy. So if one of our clients is just looking to grow and has no exit plan, then doing an acquisition from maybe a young founder who's interested in maybe a big exit down the road, they're not gonna be as interested in taking equity because that equity is never convertible to cash.

So that's not a match. So we've got to find those, we've got to match all of that up together with the seller and the buyer. Negotiate a good deal and get it closed. And we usually hand it off from that point. We have some partner companies that specialize in kind of integration, whether it be team integration, technical integration, or things like that, that we bring in to do kind of the handoff and integration for the most part we go out and look for the next deal once it's closed.

Cool, awesome, I love that. And so there's the outreach strategy. Typically, do you guys do that in-house or do you have, you know, work with a partner that helps you do the outreach strategy?

It's all in-house, but it's often through contractors, especially the research and building lists. The initial contact is often contracted out. And then once we have a contact and somebody says, yes, I'm interested, then communication is all in-house.

Yeah, yeah. Yeah. Yeah. That's the best way to go because that's a business in itself. I think you have contractors is perfect. Plus, know, to be to be strategic in multiple different types of businesses that need to be acquired to build a team that can cover all of that. You might go through a few different contractors, right?

That's cool. And what percentage would you say of, you know, because there's going to be a lot of the lot that you'll reach out to and a lot will say no, you know, and once you do have somebody that's semi-interested, what percentage are like the businesses are there, either asking for too much or they're just valued too high or not enough?

All of them. 9.9 % of business owners have an overinflated value expectation of their business. That's, that's often the toughest part especially if you've got somebody coming in and saying, hey, we've got money, we want to buy your business. Let's just dangle this price tag. Let's give them a cartwheel price.

Yeah. We learned that the question, are you interested in selling your business has to be defined as Are you interested in selling your business for a realistic term price and terms versus are you interested in selling your business as somebody willing to overpay for it? And that has to be defined early into the conversation, not to waste time. Cause a lot of people, you know, there's an old phrase like anything's for sell for the right price, right?

And the reality is most businesses aren't so unique that they command a premium price over something else. And so that's one of the toughest parts is getting valuation expectations correct. And that's where we come in again as intermediaries that help our clients because if the client contacts them said, hey, we want to buy you and we're willing to give you X, but you as a seller want Y and there's this big gap in between, it can be a little tougher than where we're involved in the middle going, here's what the market says.

And here's a very detailed valuation report that shows exactly what companies in your industry are selling for and how and why. And we've looked at it from multiple sources and multiple ways of calculating it, whether it's, know, SDE or EBITDA or whatever else.

And we, it's fairly irrefutable and we give them a range and say that's the bottom here and it's the top here. And, you know, that tends to have more weight than just like a buyer saying, this is what I'll give you and a seller saying, this is what I'll take, right? So.

Same as investing in property, you just look at where the market's at in that particular area and look at comparables. And then when an agent tells me this is what the property is worth and my buyer's agent, or if I'm buying it myself, would be like, well, here we've got these comparables. This is what it is in this range and indisputable data. Yeah, I love that.

Yeah, cool.

And then on the sell side, what's the typical lead time when somebody comes and says, I want to sell my business is that you have a chat with the,m and thein n six months they're ready to go or, I wish people would give us six months. The typical lead time is a week. Know, people call it, I'm ready to sell my business.

What I ask people to give us is three years. If you want to maximize the effectiveness of the sale of your business, three years is what you should be considering because there are a lot of things that you need to be doing, whether it's, your SOPs, your operating system, or your financials. I see so many businesses.

Just literally got off another call right before this podcast where their business is in an aggressive tax mitigation strategy as many business owners are. And they're like, I'm burying all my costs and making no profit. Well, guess what?

It also means your business is substantially less valuable. And so for some time, you need to get out of a tax mitigation strategy and into a value maximization strategy. And if you haven't been doing that, you're shooting yourself in the foot. So I would love it if people would call me three years before they're ready to sell because I can get them substantially more money for their business.

The reality is they usually call me when they're ready to sell, is, you know, then we have to work with what we have to work with. Most of our business is through referrals. The three deals we've closed this year so far,, six weeks into the year, we've had three deals closed.

Two of them were repeat customers who've either bought or sold businesses from already and one was from a referral. And so I am getting more and more clients who have a little more lead time because they're talking to somebody else.

And they're saying, I'm thinking about selling. Thenn, yeah, maybe it's that three-month orsix-monthh lead time. Most sellers that call us are ready to sell right when they call us.

And yeah, but like if you're even thinking of your, if you're a business owner and you're even thinking about selling your business, the time, to start the process and ask for help is now. And the reasons I just gave are very good because preparing your business for sale, but there's something else I've seen, which is very interesting.

If you own a business and the thought of selling the business even enters your mind, it allows for a little area of diminished lights. It's almost like your energy becomes a little bit less. And I've seen business owners who have a great business.

Maybe it's on the upswing or it's, or maybe it's plateaued, but the moment they even entertain the thought of, man, you know what, maybe I should just sell this thing. Their business starts to diminish. They just lose some energy. They lose some spark.

And oftentimes they put it off and put it off. And then all of sudden there's six months or a year, a year and a half down the road. And they're looking back going, man, how, why is my business doing so terrible? And if they think about it, they started thinking about selling at this point when they, maybe they got burned out or maybe their partner and they got into a dispute or something.

And so if you're even thinking about selling your business, um, you need to be realistic with yourself about what the future looks like because if you're having that thought now, you're probably not putting 110 % into it from that point forward. And as an entrepreneur, if you're not putting 110 % into your business, it's probably going down. So just a little psychological phenomenon I've noticed over the years.

Yeah. And I love that. And then when you do have that small little thought is like, okay, you could sell it. How do you remove yourself as a key person dependency and risk as soon as possible to make the business more desirable and more attractive to get a possibly higher multiple as well?

Man, that's the key, right? So if there's a saying that I attribute to one of my mentors, I don't know if you've ever had him on that show on your podcast, Ryan Dice, but he says, the more valuable you are to your business, the less valuable your business is, right? The more valuable you are to your business, the less valuable your business is. It's 100 % true. Okay, yeah, and then we can talk about the how so I want to dig into that.

Yeah, let's talk about the how because we communicate that through email as well. The more valuable are to your business, the less valuable your business is. And I understand it logically. Yeah, but yeah, go through it and share it with us.

Well, yeah, so if you're a business owner and you're working 40, 50, 60 hours a week, then you have a full-time job. And if the business revolves around you, if you are the hub and spoke of this wheel of activity and everything comes through you, then if you remove yourself from the business, you've removed the core piece of the value of the business. And so how many buyers want to buy themselves a job? Not very many.

Most business buyers are looking for more passive income or at least easily transferable income. And if you're working 60 hours a week, who in their right mind is going to take this on and work 60 hours a week too, to do what you're doing? So you limit the narrow, you narrow the universe of potential buyers dramatically. If you have a business that relies on you for everything to happen.

And so the, way to get out of that is you need to have a business operating system. Now, an operating system is not necessarily a piece of software, right? An operating system is a structural philosophical and documented process and procedures for how you operate your business. And there are different ones out there.

There's EOS, there's Rockefeller, Gazelles, there's Scalable. There are several different kinds of operating systems out there. But the easiest definition I can explain is if you are a franchise if you're interested in buying a franchise, you want to buy a McDonald's.

You go to McDonald's, you say, would like to start a McDonald's in my hometown. Well, first of all, you gotta have like $20 million net worth to even have the conversation with them. Besides that, they will say, okay, Mr. Franchiser, we're gonna sell you a McDonald's.

Part of the McDonald's franchise is they're going to give you a very detailed step-by-step operating system that will tell you how to build the building, what colors to put, and then how to hire the employees, how to train the employees, how to pay the employees, the process and procedures for opening the store in the mornings and for closing it down and cleaning it at night.

Every step of owning McDonald's is documented in an operating system. It's the owner's manual and it's a whole bunch of manuals. That is an operating system and your business, maybe it doesn't have to be as detailed as McDonald's would be, but your business should be able to run without you because all decisions, all important aspects, all the the strategies, everything is documented and your team understands it and they're autonomous to make decisions and take actions to continue the health of the business, even if you weren't present.

An operating system is the way to make that happen and I would dare say 95 % of business owners do not have something in place like that and that's gonna be the most critical thing you can do.

Yeah, absolutely. I love that. Thanks for that explanation. Ryan hasn't run dice yet on the podcast. Maybe we'll get him on but I want to come back to the operating. Have you heard you would have most people would have heard of Michael E Gerber the E myth? Yeah, he was on episode 300. I advise everybody to go away and listen to that. Absolutely. One world's number one small business consultant and his book The E myth was the E-Math.

This, revised version was co-written by a friend of mine and David Jennings. And he told me, David said to me one time, he's like, if your business needs you, you have a broken business. And he's all about systems. His company is called Systemology and also Michael Gerber's company is one of the best companies that help you with systems. So you guys check that out. It's a super important episode.

Absolutely. Yeah. So that just makes your business. That's what increases the number of multiple words.

An investor doesn't want like you said, doesn't want to buy a job. Let's just buy something that's it not only increases the multiple, but could make a difference between whether your business is sellable at all or not. Not every business is even sellable. And unfortunately, I've had to have those tough conversations with business owners. I look at it and say, you know what, there's nothing here to sell because the business is you and I can't, you won't be there.

So you have something that has zero value and it's a heartbreaking thing when you have business owners who in their mind, they've read these articles and they think they're going to get four X of revenue for their business. And then you explain to them that no, it's, it's zero X of nothing because like you have nothing that's sellable here. And it's a tough conversation to have.

And I don't, don't like to have it. And it's one of the reasons I'm working on a book called Boomer Sells the Business and it's to help those business owners in particular who seem to be the most susceptible to that incorrect thought, really understand what's really behind how to sell your business and what makes it valuable and who's going to buy it. And I'm working on that book and yeah, it'll be out later this year.

Awesome. Stay tuned guys. We'll check. You have to check that out. Yeah, I think a lot of boomers don't realize that the up like they have a glorified job, and then this is a glorified job.

Yeah.

But when you can remove yourself from the business where you don't have to do, like if you're doing operations in the business and you're doing delivery, you are the job. Exactly. You need to remove yourself from delivery completely. Took me ages in my business in this one to remove myself from delivery as well.

And it's better for the clients because they don't get me spread out across multiple people. They get a team that gets access to me that can provide better, you know, a really good service. So yeah, it's so critical. Now with these businesses that you are selling on the sales side, do you list them anywhere that people can go check them out or how do you find buyers for these businesses?

So that's kind of our secret sauce. My team, everyone on my team are very experienced, very successful marketer. Before I got into acquisitions, I had sold over a billion dollars worth of products and services and a good portion of that online, whether it be fitness equipment to electronics to health and wellness, you name it.

And so we've put our marketing prowess to work. And so we look at each one of our self-side deals really as a product that we are putting in front of every potential buyer that we can around the world. So we put some aggressive marketing strategies behind each deal that we bring, each sell-side deal that we bring on.

And very proud to say that in the last 18 months, we've not had a single sell-side deal that we've had less than five offers on. And we've had up to 12 offers on some of them. One that we just closed in November, we had 500 potential buyers look at that deal and we had 12 offers and wound up selling it for all cash to the perfect buyer because we're, we work globally.

We have footprints in every country digitally where we're marketing and promoting to high net-worth individuals business buyers and PE firms around the world. And so that's, that's our specialty. The more potential buyers we can get to look at a business, the higher the price that our seller is going to get and the more selection they have from who to sell the business, which is very important.

We've had deals where the seller took the second or third highest-priced offer because they liked the people better, and so it's not always just about the highest price. Sometimes it's about the right buyer as well.

Awesome. Awesome. So you just distribute that through marketing to a bunch of PE firms and places that can sell businesses, help you sell business.

Yeah, we use all of the, well, we don't use all of, we've tested all of the online platforms for acquisitions. We know which ones work and which ones don't, which ones are worth the money and which ones aren't. We focus on a core group of those platforms. And then we have a pretty robust in-house list at this point.

As I said, if every deal that we put to market has three to 500 buyers that come through, those all go into our database, and then we're marketing our future deals to those, and then through our strategic acquisition efforts, we're continually adding to our database of buyers and sellers, both that are looking to do transactions.

Yeah. Wow. Awesome. Thanks, Marty, for coming on. Congrats on what you've built and what you're doing and thanks for helping the, you know, the community in buying and selling businesses and doing it safely. Appreciate you coming on. Can we send people to check out more about what you're up to?

Yeah, well, thanks for having me. Appreciate it. I hope I shared some knowledge that'll be useful for your listeners for sure. The best way to find me for acquisitions is on my website at westboundroad.com. westboundroad.com. I'm also very active on LinkedIn. My name is Marty Fahncke. It's spelled F-A-H-N-C-K-E. I am the only Marty Fahncke in the entire world. So I'm pretty easy to find.

And I can't hide. So I'm very proud of the fact that if you Google me, thousands of results come back in and almost all of them are positive. Can't think of any that are negative unless somebody's teasing, but I'm very proud of the fact that the work that I've done for many, many years has brought many people joy and happiness have 70 testimonials, know, that are third party testimonials on my LinkedIn profile, lots and lots of video testimonials.

So I love, I love the fact that I have a very unique name. I can't hide. I gotta do a good job for everybody work with otherwise if they put a bad review about me I'm in trouble so you know if you'll be in a fight.

Yeah, absolutely. Reputation is everything. It's so important to make sure you have a good solid, you do good work to make sure your name is received well. So thanks, Marty. Congrats on what you've done.

Everybody check out Marty and we'll speak to you guys on the next one.

Thanks, Jaryd.