From Behaviors to Exits: The Business Psychology Behind Every Great Transition

In this episode, hosts Myles Biggs and Patrick Patterson sit down with Laurie Barkman, succession and exit strategist and founder of Business Transition Sherpa. Laurie has lived a remarkable arc: one of the first professional digital marketers at American Eagle Outfitters, CEO of a 125-year-old logistics firm, and a private equity veteran who now helps founders build businesses that do not collapse without them.

What holds it all together is a conviction she has carried since the start: business is psychology. Whether you are selling jeans for a hundred dollars or guiding a founder through a hundred-million-dollar exit, how people decide and trust has not changed. The tools have.

Tune in to learn why hope is not a strategy, how to build a business that thrives without you, and what the early digital marketing pioneers can teach us about navigating AI disruption today.

Key Takeaways

• Business Is Always Psychology: The fundamentals of how people decide, connect, and trust have not changed. The tools are different. The psychology is not.
• Build a Business That Thrives Without You: Owner dependency is one of the biggest risks to enterprise value. Laurie breaks down the three dimensions of exit readiness: personal, financial, and business transition, and why starting earlier is always the right answer.
• Hope Is Not a Strategy: Most founders do not know what their business is actually worth. Laurie explains how to think about multiples, what buyers really look for, and why working on value drivers every day is just good business.
• Anti-Fragility Is a Competitive Moat: Fragile systems break under stress. Anti-fragile ones get stronger. Laurie unpacks why the human ability to unlock clarity for clients is something AI cannot replicate.
• The Entrepreneurial Gene: Patrick argues for unending curiosity and ego-free humility. Laurie adds risk tolerance. Together they map out what separates founders who scale from those who stall.
• Write Down Your Processes. Now: The businesses that win are the ones with documented decision-making frameworks. If the knowledge walks out the door with one person, you do not have a transferable business.
• The Interviewing Framework That Works: Strengths, motivations, and fit. Laurie shares the framework she used to land her CEO role. The reframe: every hiring manager is trying to hire the least risky person.

Resources and Links

Guest:

Laurie's website: lauriebarkman.me

Laurie's book: The Business Transition Handbook

Laurie's podcast: Succession Stories

Laurie's LinkedIn: Connect with Laurie Barkman

Connect with the show:

Myles's LinkedIn: Connect with Myles Biggs

Patrick's LinkedIn: Connect with Patrick Patterson

Level Agency: Learn more about Level Agency

Special Offer:

AI Visibility Audit: Find out how prepared your business is for the AI Search Revolution. Get your AI Visibility Scorecard today.

Transcript

Laurie Barkman 0:00

Where I find in my own practice of being, I think, which is an anti-fragile business, is because I know from experience that owners aren't confident and not finding the clarity on some of these big decisions on their own. So it's not the information that I have. It's how to help them unlock and finding the answers that are just captivating their mind. That to me, is anti-fragile because I cannot be replaced.

Myles Biggs 0:27

Hello everyone and welcome back to the show. I'm your host, Myles Biggs. Today I am here once again, the CEO of the Level Agency and my co-host Patrick Patterson. On this podcast, we are driven by truth sometimes the hard truth. We believe it's imperative to be relentless for results because if you are not your competitor is we're obsessed with how to be better every day because that's what our customers deserve. And if you can set aside your ego, if you can truly be no ego, then we are the show to help you go all in because good enough isn't. Today we're talking with Lori Barkman, CEO, turn Succession and exit strategist and founder of the Business Transition Sherpa. Helping founders build businesses that don't collapse without them. Lori, welcome to the show.

Laurie Barkman 1:08

Hey, thanks so much for having me. I'm excited to be with you both.

Myles Biggs 1:11

So, Lori, when people hear of you for the first time, like many of our listeners are right now and they do a quick go Google search, what comes up is that story arc, right? Um, CEOA Fortune 50 Acquisition founder, et cetera. But I'm curious to know what doesn't that nice soundbite cover? What, what part of your story is commonly left out but actually matters most?

Laurie Barkman 1:31

Yeah, you know, we always hear about the most recent stuff. So I think the origin story part and the career trajectory in marketing is probably something that doesn't get talked about now, but it used to in the past, I worked at American Eagle Outfitters as one of the early digital marketers. Not the first, but probably the first sort of quote unquote professional digital marketer at a time when that wasn't a career field. And what was really fun about that, if you're familiar with American Eagle Outfitters, there's ae.com. So you, you want a fun fact?

Myles Biggs 1:58

Sure.

Laurie Barkman 1:59

Okay. So fun fact was when I joined the team, the company did not own the URL, American Eagle outfitters.com.

Myles Biggs 2:08

These are just crazy.

Laurie Barkman 2:09

It was owned by some squatter in Maryland and I worked with our legal counsel and at the time, you know, the, the governing bodies icon, I think it was at the time. And we got it and it cost us nothing. Oh,

Patrick Patterson 2:22

you, you didn't have to pay for it?

Laurie Barkman 2:23

No.

Myles Biggs 2:24

Oh, wow.

Laurie Barkman 2:24

Nope. I think it was$40.

Patrick Patterson 2:26

Oh my goodness. That's

Myles Biggs 2:27

incredible.

Laurie Barkman 2:27

Yeah. So I have that claim to fame. And then the other, there was other really fun things about working in a digital environment like that. Doing things for the first time, and now especially, and you guys see this, right? It just, it's so sophisticated in the digital marketing space and I'm just really, I'm just really proud about some of those earlier days as a, you know, as a digital, as a digital marketing native, if I can use that term.

Patrick Patterson 2:51

I mean, you've seen some of the crazy transitions, right? Like the, the transition from print to digital, the transition from digital, wherever we are right now. But, um, what do you think, and, and, and you've been leading teams and, and leading organizations, uh, through all of that change, what have you seen has been like maybe the biggest change that led to an opportunity and do you think we're in a moment like that now, or is that, or, or was 2000. Dot com a little different.

Laurie Barkman 3:24

It's so funny because I always feel like what's old is new again, and there's, there's a lot of years that I wasn't as hands-on as I was in those years, right? So meaning that in my career, I, I grew to manage businesses and p and l and, and I wasn't doing the marketing, I was hiring marketing folks, right? And so from a practitioner standpoint and arm's length, when I look at the kind of the current state of marketing, digital marketing, there's so many truisms that we had even back in the early two thousands of when, when we're marketing to people. They're people, right? So whether it's B2B or B2C, it doesn't really matter. There's a psychology of business here, and I thi I think some of the tools are different, uh, widely different and, and so wonderful. But, um, I'm jealous in a way because there were so many things that we would've really benefited from, especially in the data aggregation side. It was so manual, you know? Yeah, we were putting all these spreadsheets together, but that's how me and my team managed things. We got down to the penny showing the value of what we were doing, and I just love the measured marketing approach. And so today that still exists. It's just that our tools are different and they're expanding and they're making us so much more scalable, able to work more, you know, faster, better, et cetera, et cetera. So I find that fascinating. But I think the premise of what we're able to do, um, from, especially there's brand marketing and measured marketing, so the brand marketing side is obviously evolving. Incredibly fast as well. Um, but at the root of it is the psychology of, of, of business that I just find fascinating.

Patrick Patterson 4:56

Well, I think that's like totally right. The, the interesting part is we have all these new tools that are doing all these cool things and it's actually stripping away the complexity that you and I live through for the past 20 years in digital marketing where it was a lot about the operations, it was a lot about the tools, it was a lot about the setup. And man, you know, I remember 2009 we were trying to do lead scoring and it was a two year project and millions of dollars and then it barely worked. And now we have a tool here, Lori, that does the model every single day for our clients, right? Like daily, we're redoing models for our clients. And so, you know what that allows us to do, and I think you're exactly right, is when you strip out the, the busy work, the robot work, then it comes down to. This is a people serving, people, serving people business. And it's all psychology. It's all, it's all empathy. It's all like really getting down to what traditional brand marketers would talk about. Right. And then us digital marketers came in and said, no, it's all about ROI. Uh, and so now it's this amazing combination and I think kind of three legs of people, technology and creative, all coming in, in, in kind of a confluence together in something that is, is really exciting. And I was just telling, telling you, and I'll, I'll tell the audience here, you know, I'm spending like 15, 16 hours a day in, in, in my, doing what I'm doing because I love it. Right. Because it's so much fun now that you can just. Not deal with the BS anymore. Right. So, uh, it's interesting as we get more technology, how we're going back in time and remembering what was important before we had it.

Laurie Barkman 6:45

Yeah. I think there's always gonna be a blend of how do we pro, how do we produce results for our clients? And our clients are gonna look at the bottom line, and if we just remember that we have to put ourselves in the shoes of the buyer as well. Right. What is it that they're, what they're seeking. Sometimes it's beyond the digital stuff, it's the relationship stuff, especially if, if events are important, right? And we have to make sure that we're representing our clients in a way that is, you know, true to their brand. But it's the human connection. Is it, it, it's an interesting dialogue to have with you guys because as I have progressed in my career, I've seen over and over that it's actually, I think about experience. Do people enjoy working with you? So your firm might be. Um, you know, so talented and all these systems and tools. At the end of the day, it's gonna be probably the frontline account managers and right. They're gonna look at the numbers and say, what have you delivered for us? And then, do we like working with you and how are you representing us in the market? Are we, are we satisfying those requirements?

Patrick Patterson 7:51

You know, it's amazing. I think when, when we started this, uh, we wanted it to be a meritocracy, right? We wanted it to be, you know, just pick the agency that's gonna give you the best results. Uh, it's so much more than that. And it, you know, our, our new head of ai, um, Chris, who is just phenomenal, uh, you know, he has been on a, on a mission, uh, to, to make us the, the easiest agency to work for and the easy, easiest agency to work with. And, you know, if we can use technology to that North Star. It's not about ruthless efficiency and cutting the bottom line and, and all of those things like, you know, we need to adapt as an organization. Every organization needs to adapt. It's more about how can we, to your point, how can we, how can our clients love working with us? How can they be raving advocates when they, when they, and, and how can the work that we do turn our clients' clients into raving advocates, right? Like, that's the work, that's the hard part, right?

Laurie Barkman 9:00

It is hard. It's hard, but it's, it's important work. You guys are doing a great job and, and probably as part of the narrative and the story here of why am I even here? Why am I having this conversation with you guys? I mean, pat, you know, we, we first met, I think we were figuring out, we met in like. 2007.

Patrick Patterson 9:16

I think that's right. Right. So you were at American Eagle and then you went to a large education organization. Uh, and we overlapped there.

Laurie Barkman 9:25

We did. And I, as I think back to that transition, people were like, oh, you were selling jeans and now you're selling this education. And the way I always talked about it was, yeah, you know, from an average order of a hundred dollars online average sale to a hundred thousand dollars average sale, it's, it's a difference is that it's a highly considered purchase versus more, maybe a little more emotive to go out and buy a pair of jeans. You think you look good. And, and that really changed a dynamic for me. Also had to think about, um, how people buy. Right? How do they decide, especially in education, right? And you have other parties who are, are part of it. Um, but kind of back to the how. I've observed you, some of your teammates, how you've grown to be an entrepreneur and so successful over the years. I'm just so proud of you, honestly. It's just, you know, I've kind of watched from afar and so I just wanna call that out.'cause Yeah, we have a shared past. I appreciate that. Um, we didn't work directly together very much, but I always knew of you respected you and, uh, I just think it's been incredible what you've done with the, with the company.

Patrick Patterson 10:26

Well, Myles, she, so, you know, there were two big divisions. She worked in the larger of the two, two divisions at the time, right. And, uh, ran marketing, uh, and, and has just an amazing background in it and led an amazing team that have now all, all gone on to do amazing things as well. So you should be super proud of that. Um, and here I am, I come from the tech side, uh, and I get put in charge of, you know, digital marketing. And I didn't even know what like Google Ads was at the time. Right. I didn't. And so I'd walk into these meetings almost as a superpower. Being like, Hey, I'm just a simple country boy, uh, trying to do some marketing. Uh, why are we doing it this way? And that was, you know, kind of the advent of the, like, nothing sacred, because I got to come into it with completely fresh eyes and be like, that's silly that we're doing it that way. Um, and that, you know, kicked off conversion rate optimization and kicked off a lot of different things. Um, but I, I remember there was always this little bit of a competition between Lori's, Lori's amazing group and us this upstart, uh, online group that we had. Um, and it was, it was a ton of fun. Right? Well,

Laurie Barkman 11:41

maybe that's the entrepreneurial spirit that lived in all of you. There's so many folks in your group that became entrepreneurs. A really talented group. And I often, and you know, I have a podcast as well, and so sometimes on my show. I ask people, I love talking to founders and I have a real big heart for entrepreneurs. So that's why one of the reasons why I love Pat so much. But, um, I think that the question is, is is there an entrepreneurial gene and what does it mean to you? Oh my gosh. Maybe I ask you, can I ask you that question?

Patrick Patterson 12:11

Sure,

Laurie Barkman 12:11

yeah. What do you think?

Patrick Patterson 12:13

So I think, I mean, one gene, one trait, one key behavior. Probably not. I think in, you know, I think in general it's multiple. I think you're, for me, the first and foremost is this unending curiosity of what's possible. And without that, without the, like, the drive to figure it out. I think, you know, you're never going to break through. You may be able to run a really great team. You may be able to, uh, you know, grow organically year over year and operationally handle things. But like, if you're gonna, if you're going to like, invent and truly go out there and put yourself out there, I think the first is unending curiosity. The second, and this, honestly, and you know, this, unfortunately, Lori knows me, uh, uh, being humble and is an an ego list is probably the second trait that I would, I would put right after curiosity. And, you know, the, the reason I say that is I started my career super stubborn, but super curious. So I had the one trait, but I didn't have the other. And because I was so stubborn, I refused to. I refuse to step outside of my box. I refuse to make myself uncomfortable. I refuse to take criticism. Um, I was the smartest person in the room, just ask me. Right? And I think that stunted a lot of my growth'cause I wasn't opening up to really amazing people around me and learning from'em. Um, I think those two things, like I, everything else is, is maybe table stakes. But if you don't have those two things, I think it's really difficult to truly break through. You may be able to launch a good idea, but build a, build a, a growing a thriving company, it's gonna be difficult.

Laurie Barkman 14:17

I love those answers. Those are great answers. I think one that I've heard also commonly is risk taking. So maybe. The curiosity goes hand in hand with the risk taking because you can be curious and then do nothing with it. That's

Patrick Patterson 14:27

true.

Laurie Barkman 14:28

Right? A

Patrick Patterson 14:28

hundred

Laurie Barkman 14:28

percent. And I think you, you know, so if I added a third to your list, knowing, knowing you, and knowing the business, that's what I would say for you.

Patrick Patterson 14:35

Yeah. Uh, bias towards action, right? Myles.

Myles Biggs 14:38

Yeah. You gotta break some rules, right? It's like we say all the time, like, we can do whatever we want. Even if we created the rule, we can also break it and then create a new one. And that's okay.

Patrick Patterson 14:46

Yeah. Lori, we literally say in meetings sometimes, it's like, well, turns out we wrote the rules, so there you go. We can just change it.

14:53

Decide

Myles Biggs 14:53

to do it differently

Laurie Barkman 14:54

today. And I love that.

Patrick Patterson 14:55

I love that. So, so Lori, after, after our, our overlap, um, where did you go and what was that experience like?'cause I believe that that next stage in your career led to where you are today.

Laurie Barkman 15:05

It did. Yeah. It's part of my narrative too, is going from startup to big CO and then back to small co and back again, right? American Eagle Outfitters was not my first rodeo, but it's a very big company, you know, global company and. EDMC and you know, the Art Institutes was a very big company as well, publicly traded at the time. And when I left, I went to a startup. So I had been in startups after I got my MBA and again, found my way to big co, you know, global companies and I was like, ah, I'm just, I'm missing it. I wanted that, I wanted the impact on a smaller organization. So I joined a SaaS recruitment business. So they had a HR recruiting tool, wonderful design niche was in, uh, you know, small SMBs, like small companies. Um, and I was leading marketing and it was fabulous. I was building a team and, and the cachet of coming from the companies I was from was wonderful. But then you gotta like, the rubber meets the road and you gotta deliver, right? It was hard. I mean, those years were tough because we had traction. Um, I think I was employee twelves, you know, when I joined. Um. And I was super motivated to kind of see that through. But a recruiter had called me, somebody I knew from the real, the retail days, and he said, I am recruiting for a CEO position in Pittsburgh, which is where we are and where I live. And I'm recruiting for this position. They're looking for somebody with an e-commerce background to be the CEO of a division. It's a planned succession. Are you interested? And I was like, self-doubt. I'm not qualified. Why are they calling me? Right? I'm a marketer, what do I know? Blah, blah, blah. All that self-doubt shit. Can I say that? You can

Patrick Patterson 16:55

swear as

16:55

much

Laurie Barkman 16:55

as you want. Yeah. Okay. So all that self-doubt, negative talk. And then I was like, wait a minute, I can do this. And the process took so long it took six months, but it was a good process because every time I stepped through that gate and made it to next, the next gate, I was so much more confident and eventually got the job. And what it was was a third generation transportation logistics company. About 125 years old or so, and they had a division that was not a startup, but it was the Maverick. And it was at times highly profitable and at times not so much. And so it was a, a cyclical kind of a business. They were looking to look for somebody to be in that role as part of a long term succession plan. And what they had said to me in the interview was, we're now looking for you to be part of our team for three years. We want you to be here 20 years. And it was music to my ears because as y all know from interviewing with startups, I mean they, there's not never a conversation like that. And that was so, I was so excited for that. And I made an impact in a variety of ways. It was a tough, it was probably like the best of times, the worst of times, right? To be a CEO. It was over 150 million revenue. There's a lot of responsibility. I was one of the only, I was the only female executive at the top. I wasn't on the board, but I attended board meetings. I presented to the board and it really pushed me in a lot of ways. Um. I learned so, so much. And you know, the, the short end of the story there was, um, I wasn't there for, for 20, I was there for three. And the reason why is because the company was acquired in 2015 by a very, very large global entity. And I became an officer of that company, of the big company. So now here I am back in another big CO and um, that lasted through the integration process. I was part of the steering committee and, you know, again, senior executive for all that. And amazing experience just to see that playbook. Um, I left in 2016 and then I joined a private equity group. I just realized, you know what I like, I like deals. I'm kind of a deal junkie here and

Patrick Patterson 18:59

Right.

Laurie Barkman 19:00

Is getting a flavor for investments and how, you know, how those are considered. And eventually that's what all those things combined influence what I do today, which is I, you know, launched Business Transition Sherpa to help business owners create value and an exit on their terms when they're ready.

Patrick Patterson 19:16

Well, you know, the, it's really interesting the, we both come from marketing and, and various backgrounds, but as soon as, you know, we brought in private equity here and I started understanding how private equity works. I told my chairman, I was like, I think if I would've found private equity 20 years ago, I would've gone into it. Uh,'cause I really enjoy it as well. And it's, and it's a, um, you know, it's, it's like peak curiosity and uh, then you're just covered with data. All over. Uh, but then it's so personal and relationship driven that, you know, I, I didn't really realize this, Myles when we, you know, when you think about private equity, and I'm sure Lori can back me up here, but like, when you think about private equity, you're like, it's, you know, a bunch of analysts with spreadsheets and they're all doing their models and

Myles Biggs 20:10

everybody's in a vest

Patrick Patterson 20:11

discount, cash flow. Well, they still wear the vest so that, that part is true. Uh, but the, you know, I just figured the ba it was all model driven and it was all numbers driven. And that, that's true to an extent, but there's a lot, especially when you're doing like first institutional capital and you're investing in a business, you're investing in a person, you're investing in a, in an idea because it's not really proven yet. And so, you know, there's a lot of relationship trust and building that has to go into it. And I was just surprised with how. How, how similar that actually is to client services and what we do here at, at level. Right. It's very similar. I mean, is that that your experience as well as you went through it? Yeah. You know, it's interesting, it was a larger scale.

Laurie Barkman 20:57

I, I've, I had always heard when, in my MBA days when there were the, there was a, the boom, right, it was the late nineties, so it was the tech boom and there was a lot of money floating around. Investors were looking to to place, place their bets and I remember people who had said, you know, these investors are investing in the people, the technology or whatever. The idea is secondary. So if you were in a meeting and you're trying to pitch again, this is the late nineties. I know things have maybe changed since then, but. I always found that to be so interesting and I never really believed it, kind of, and now I think I get it more. I do. I, and so whether it's private equity or whether it's, you know, angel investing or, or whatever. And, and from my end of my world, what I serve as a intermediary and an advisor in m and a deals, um, in the private market, lower middle market. So these are privately held companies, bootstrapped, they don't have investment. They're, they, they've either, they're either the founder or they're a kind of a next gen, right? Whether it's second generation or third. And it's all about relationship.'cause when I talk to folks about, well, who's the right buyer for your business? Who should own your business after you and I, I wrote a book about this actually, and this is one of my favorite chapters. Um, so I wrote a book about business transition and. One of my favorite chapters is, and again, on this notion of who should own your business after you, because for some it's really about the legacy. What have they built, what's the, who's the right fit? Um, which would lead us down a path of deciding, oh, well, okay, it's probably not my competitor because we have a culture clash. It's probably not, you know, these, this and that. Or it could be leading us to, oh, it is more of a fit with a patient capital type of mentality with a family office as opposed to a more typical five to seven year time horizon on ownership with a PE group. Right? So from a seller's perspective, that's the psychology of what I've learned so much more about over the last five to seven years.

Patrick Patterson 22:56

And I think that's, it's so critical and no one teaches you that. Right? And I think we, we were, we were chatting this morning, like the first time you're having these conversations as a, as a owner, as a, you know, in leadership, you're like. These people have done hundreds of deals, right? Myles, like hundreds of deals, and you've done zero and you have no idea what the pros and cons are. So you're kind of like walking into it and you don't know exactly what, like what saying yes to something actually means for you afterwards. Right? And I can, I'll be very honest with you. Like I had a great group of advisors, um, and, uh, one from, from, from, from your past as well. Um, and, uh, you know, Vistage was super helpful. Uh, and I got, had to get educated. I was like, okay, if you do this, this is what's gonna happen. If you do this, this is what's gonna happen. I had to trust a lot of people. Uh, but man, without that peer group, without Vistage, without YPO, without those folks, I don't know how. Someone can make a good decision. So what, how do you extract that? How do you get that information into people and how do you, how do you have that conversation?

Laurie Barkman 24:15

I try to have as much education out there as I, you know, I do a lot of podcasts. I have my own show, as I mentioned, it's called Succession Stories. And so I've been doing that show for six years. And so I think there's a body of work, not only my show, but other great shows. So podcasting is definitely a mechanism for trying to get the message out and then in the book, like how do we help educate webinars and things like that. But if we can get more business owners to recognize that it isn't about waiting to the end to improve the value of your business, it isn't about waiting to the end to figure out who's the right fit buyer for you. Uh, I have a concept, you know, called reverse engineering. So if we think ahead to on our exit timeline, maybe it's five to seven years out, maybe it's 10 to 15, whatever it is, there's an age and life stage and everybody's gonna have a different perspective. I have some clients that are like, I wanna sell in three years. Okay. You know what? Translation, you're already behind the curve already. They're like, oh, when? When's the best time to start? Oh, best time was actually yesterday. Next best it's today. You know, it's that kind of mentality, but a lot of business owners don't think about it that way. They're like, ah, kick the can. Kick the can. And there's, and there's different dimensions of being ready. There's different dimensions of having an attractive business and there's different dimensions of, um, transferability. You know, any one of those three we could probably spend an hour on. Right. What makes your business attractive, transferable, and ready for a sale? What makes a, you as the business owner not attractive that Right. But the readiness piece. So that's exactly why in my practice and with my clients, I start with personal transition. I wanna know about their business. I wanna kind of get a lay of the land, but I wanna know what's important to them.'cause at the end of the day, there's a lot of, whether it's family, business, or whether it's, you know, founder led. That's what's gonna make them decide, should I do this, should I not do it? And when should I do it? There's so, so much complexity. So your question's a hard one because the answer of course is it depends. Um, but I think that there's three legs to the stool, right? There's personal trans, there's the personal transition side, there's the financial trans transition side and the business transition. So for those of us that are fans of strategic planning, EOS, things like that, those are to me wonderful tools. Love it. They are operational with your team. What I do in working with clients is I am working with the business owner. This is not Front Street, this is not for Front Street. When we're ready, we'll share some of these things with the right folks, but it's a strategic planning process that I call strategic transition planning. And as you might guess, right, that third leg of the stool is gonna dovetail at some point, but it, the other pieces have to be playing in. And that's the thing that I see is that business owners are like, oh, you know. Um, yeah, I'll figure it out. You know, I'll just figure it out. They kind of trust. And you know what? Hope is not a strategy. Does anybody, do you guys think I've, no. Hope is not a strategy. So we have to have a plan. And by the way, as you probably know this, if we are writing our goals down, we are more than 40% likely to achieve them. So if you've set goals for your business, like revenue growth, fabulous. Love it. Okay. What goals do you have? What KPIs do you have? Very, very few entrepreneurs, founders have an enterprise value goal. They don't know what their business is worth today. They haven't measured it. Maybe they talked to somebody at the golf club and they got an estimate. They read something, oh, we should have this multiple. I talked to so many owners that are. Their, their sense of what their business is worth is overinflated. I talked to a woman yesterday, she's like, yeah, I wanna sell, you know, maybe in the next three years she didn't tell me she had health issues, but I'm kind of guessing. And she's like, well, you know, my business is trending downward in revenue and, uh, we, we have revenue concentration of 95%. And, uh, I am, I run marketing and sales and everything else. So owner dependency, boom, boom, boom. And I was like, look, I'm on the phone with her for half an hour. At the end of the call I said, look, you know, happy to talk again. Um, but here's my observations for you. I mean, essentially what I was saying to her is, you do not have a sellable business right now. And I was asking her, I'm like, well, what kind of multiple she thought she was? And I'll say, it's a SaaS, you know, kind of a SaaS product. Um, ish. SaaS adjacent, SaaS adjacent in the marketing space and SaaS adjacent and meaning there's not a clear business model on subscription revenue. Yet she wanted to get a multiple of revenue.'cause this is the thing I love about educating my business owner audiences, is that when someone says to you, a multiple, I sold my business for a multiple of five, I want everybody to go a multiple of what? So we could talk about that. What's the math? A multiple of what? So I asked her, I said multiple of what she's, like I said, multiple of revenue. She's like, yeah. She was thinking she's gonna get five times,

Patrick Patterson 28:56

I'm sorry, five. Five x revenue.

Laurie Barkman 28:59

Correct. For a business, it's less than a million dollars of revenue. And that's amazing. All the reds, all the red, you know, check the boxes of red or green. She's got a lot of red. Right. And I, I kept thinking she's just, she's just off. She's just way off. And it's all about, well, how much time do you have and resources do you have to make a difference to mitigate those risks? Because at some point you just sort of cut it. You're like, that's, I got what I got. And I accept my fate, you know? Or if people are listening to me and going, aha, she's right. I have a longer runway. I need to understand what risks are in my business right now. How can I mitigate those risks? And then also work on value growth.'cause not all growth is created equal. Right? And so yeah, if you grow revenue, but it's not the subscription revenue, it's a different kind of revenue, why would you think you're gonna get a revenue multiple, like SaaS companies? Yep. So I think she understood that. But she's also up against the clock and that's what makes it really, really hard to talk to folks, especially baby boomers who have that clock kind of ticking. I love talking to Gen Xers. I'm a Gen Xer. Lived in that world a long time, obviously,'cause that's where I am right now. But Gen Xers have in general about a five to seven year time horizon, which is great. That should be enough time to kind of do the things that I'm suggesting and have the ability to make that exit on your, on your time life.

Patrick Patterson 30:22

Yeah. You know, the. The past four years I've been, we've been working on our own value drivers. Um, and the really interesting thing, and Miles you've seen our value drivers and Yep. You know, we talk about them all the time. Uh, as an organization, uh, there are to, to create value in your business. You shouldn't be doing it for exit. You should be creating a valuable business. And I think that's where people get hung up a little bit. You know, I had this unlock kind of moment where I was like, oh, these aren't things that I'm doing to prepare for an exit. These are things that are just good business principles. Don't have high concentration in one client, don't have high concentration in risky verticals. Have a succession plan for your, for your, uh, you know, your top executives and your top core people in the, in the organization. Like these are all de-risking, uh, uh, things. And then there's the, the future looking things, which is the, the future scalability story, which you need as a CEO and a and a leadership team. Like to inspire people, right? So if you can inspire your, your, your, the people that work for you, you can inspire your clients. You're gonna be able to inspire an investor, you know, by showing them case studies of how you could, what you, what you did do, and then how that could be unlocked in the future, right? So I think there's all these different things, but when I think, and I don't know if you would agree with this, so I'd love for you to argue with me if you don't, but I, I think like founders should stop thinking like, what do I need to do to sell my business? They should be thinking every day, how, what are the value drivers that make my business more valuable, and how do I increase this? And it, it turns out, it's a crazy thing how this happens. If you work on those value drivers and you create a really valuable business, people are gonna want to buy it. It's, I, does that make sense to my, I mean, I'm

Myles Biggs 32:23

tracking the

Patrick Patterson 32:23

lot. Okay.

Laurie Barkman 32:25

Well, it's true. And I, I, I love what you said. I actually find myself saying it too quite a bit, which is, uh, and I'll also add to it, which is buyers buy on their time, not yours. Right? We, we think, oh, I'm gonna sell my business and someone's gonna buy it on my timeline. Well, no, buyers are gonna buy on their timeline, so hopefully it matches up. The other part of what you said that I think is important. We have to have a business that serves us in a good way. I mean, there's a lot of founders that have mental health issues. They're stressed, they're facing divorce. They might have other, you know, other health related issues they're dealing with. And it's the, the business itself is not healthy. They're not healthy. It's just not good, you know, all around. So if we have a healthy business, then hopefully our, our CEOs, our, our owners are healthy too. I think that's a, I think there's just sometimes a codependency that's really messy. Um, so if we have a business that can thrive without the owner and thrive means just like you would expect, right? All the things I just said, plus all the financials and things, there's so many different aspects of what can make that happen. And yeah. Why would you wait? Why would you wait to quote, unquote, sell for all that goodness, right? Why have a, why wait to have a good, healthy business? Wanna sell.'cause again, it's gonna be too late, right? You wanna be working on the things that make your business more valuable.'cause guess what? It's actually gonna make your business more fun to run and maybe make you more healthy and running it.

Myles Biggs 33:55

The whole theme so far has been the people part of everything. Right. Um, and going back to what you said very the beginning about how with all marketing, no matter what industry it is, it's about people connecting with people. But what about AI and all of this, right? Because I'm wondering if you've seen it already or if you have any predictions, like when does that logic breakdown and what works when you're communicating or working with agents is not the same as what it's gonna be with an actual person?

Laurie Barkman 34:21

I think it's such a fascinating time. Again, as a Gen Xer, it's like we have this interesting life where we, we know what an eight track is and a typewriter, and then we, and then we're seeing ai, right? We've literally trans. Transitioned on, on all these technologies and it's fascinating. I I, I see something very, very interesting happening. I, I, I think agents and things like that are gonna make our work better. And so it's gonna make the knowledge worker job different because it's about using the tools. And I know a lot of people fear, oh, I'm gonna get replaced. Well, maybe, you know, there was an article recently that's gotten like millions of views and their CEOs of, of some very, very big companies paying attention because they are looking at that going, wow. I look at it and as I think the now the role of the knowledge worker, we went through a big transition, you know. Whether there was blue collar, then transition to white collar. If you look at the history of like the industrial, you know, revolution us, right?

Patrick Patterson 35:18

The, the, the best, the biggest job, like 120 years ago was farming.

Laurie Barkman 35:21

Yeah,

Patrick Patterson 35:22

exactly. Like literally like, like, like Right. The number one job. Yeah. And it's now like, not even close to like top 10,000. Right. It's, it's crazy.

Laurie Barkman 35:30

It's crazy. And my, my son goes to MIT, he's graduating in May, and I said, you're so lucky you're in ground zero of AI and all these things. And you know what his major is of computer science. Okay. Not a shocker. His second choice on the, he's a double major. He's math.

Patrick Patterson 35:51

That's what I was, I was math, computer science.

Laurie Barkman 35:53

I'm not shocked by that.

Patrick Patterson 35:54

There, there you go.

Laurie Barkman 35:55

And I was like, oh, well you don't wanna, this is years ago. I was like, you know, helping him think about, well, what do you wanna focus on for your studies? What about ai? And he, I think to his credit, he sees it as a subset. Because if, you know, if you know the concepts. Um, some things that we have out in the world are not ai, they're just kind of like algorithms and we've had algorithms for a long time. So yes, he can distill a lot of those differences. And I think he's also observing firsthand some of the changes in the software engineering space. And we've seen it in the tech space, especially in the last week or two, if you've noticed. The tech stock value dip that we've seen in the, I've noticed, yeah. Yeah. Pretty noticeable. Right? And that I think is very, very interesting because where is the value for a SaaS company in the future if AI is gonna come along and kind of replace what that business is doing?

Patrick Patterson 36:51

So

Laurie Barkman 36:52

that's a scary, scary thing.

Patrick Patterson 36:53

I, I, I love the future for your son because the knowledge and the education that he's getting has served me so well, you know, I was coding AI algorithms back in 2002, so that was 24 years ago. Right. Um. But the, that doesn't mean that I'm better at AI than other folks, right? Like I look at actually what I learned from computer science and math. A, how do I think logically about something, right? Um, B, how do I think modular? How, how do I think in modules? And this has been like, if you're not a programmer, then maybe I'm gonna get a little geeky here for a second, and I'm sorry, miles. Um, but you know, in programming you have things called functions. When you just start programming, you write this long, uh, you know, application. It's just one file and it's just, it, it, it's, it does everything. It's an if this, then that. And you're like, functions cool. So like, I am doing this code over and over again. You take out that function, you call it refactor, and you can then call that function like, that's really cool. So. Then you have things like objects and you get into object oriented programming where you're creating things like, you know, data factories and, and all of these things. And so, you know, as I started to think through that and then I kind of post hoc rationalize some of the choices that I've made at level as you often do, you know, just driving in a car, I'm like, yeah, I, we've set up modular structures, right? Like we have a golden rule for all of our technology that it has to be able to be replaced within 90 days. You know, we have abstraction layers on top of the different tools that we're, that we're using, including LL apps. Um, you know, these are important things that if you don't think like a programmer, you're probably setting up your company in incorrectly, right? And for what's coming. And in a lot of ways it's already here. But, you know, so I love the future that your son is going to be going into'cause he's gonna have such a leg up. And, you know, wherever he goes. And it could be into, you know, veterinary science or it doesn't matter because he's learned this core logic, this core way of thinking that I think is the new way of thinking in the future.

Laurie Barkman 39:19

Yeah, that's cool. I'll tell him you said that. I'll be excited.

Patrick Patterson 39:24

So is this conversation entering into, you know, as you talk to founders, as you talk to um, folks, uh, you know, we do a lot of m and a here, and I talk to a lot of folks and I can tell you personally, I get either a, it's a like a 50 50 split of I am a absolutely terrified and I need to sell my business as soon as humanly possible.'cause AI is gonna destroy everything. And then, uh, the other half is like, it's amazing and I'm so excited about it and, you know, how do I, how do I figure it out? But like, where are, where are you figuring it in and, and how are you looking at. Valuation of a business and preparation of sale for a business when it comes to these types of things, because I think investors are gonna start having an ai, um, checklist, uh, when, when they're looking at, at, at doing investments.

Laurie Barkman 40:17

I think it depends on the industry. I work a lot in the built environment, and I think this is gonna lead us down in a conversation to talk about the notion of being anti-fragile. Um, companies in the built environment would include like HVAC companies, engineering firms, construction services, right? We are architect, right? We're creating a physical thing and we can use, and I serve on a, an advisory board for a construction company. We can use AI in those settings to help us do our jobs better, more accurately, things like that. But in and of itself, I don't think at this time. It's such an important value driver in the, in those types of companies. Maybe in, in, in the future, you know, I'll change my answer, but as of now, not so much. The industry that you're talking about makes total sense. You're talking about the advertising and, um, kind of the, the recurring revenue advertising model and things like that. And so the role that technology can play in that industry Absolutely. I think is, is for sure a value driver. Um, I do have clients that are in the marketing services space, but I would say they're more public relations and relationship-based events. And so for them, it's been a conversation about, okay, what might we do to enhance the productivity of your teams? But they won't, they won't replace, they need, they can't replace the face-to-face and the handshake and the. You know, the, the celebrity events and, and things of that nature.

Patrick Patterson 41:56

Yeah.

Laurie Barkman 41:56

Um, so it's hard to say for that slice of marketing services firms. And then I think in general, what I would say to technology kind of goes with process. I think Miles, this is one of your favorite topics is, is a business, you know, does it have like repeatable processes and are they well documented? And then when, if you bring in somebody, you know, can we train them easily? And, um, you know, it also helps protect if someone leaves that all that knowledge isn't gonna just walk out the door.

Myles Biggs 42:26

Yeah.

Laurie Barkman 42:27

So in, in another way of answering your question. Technology can serve a role in that. And if AI and ages can place and help us do that, which is having SOPs, having documented, you know, processes, whether it's video written down, I don't really care. Um,

Patrick Patterson 42:44

written down.

Laurie Barkman 42:46

Written down. I promise. I think making videos is really hard because you have to update them all the time. So yeah, write them down.

Patrick Patterson 42:50

Well, as someone, as someone who's building genic operations inside of level, uh, like written down process. Written down, not video.

Laurie Barkman 43:01

Yeah. Write them down.

Patrick Patterson 43:02

Not a training, uh, person that is going to do a live training.

Laurie Barkman 43:06

Yeah.

Patrick Patterson 43:06

Like those things are important too.

Laurie Barkman 43:07

Yeah. Write them down. But

Patrick Patterson 43:08

like, literally a simple text file, not like a, not like a a a, a Miro board with, or a PowerPoint presentation, like a simple text file is what I need.

Myles Biggs 43:21

So would a, would a transcript from a video work for that, or does it need to be even more specific?

Patrick Patterson 43:25

Yes. A transcript would work. Uh, so, you know, when we think about writing down instructions and writing down process and, and Lori, I think that's so important. I think every business right now, and you wanna, you, you want, you want like actionable instructions for every bit, every listener here, you, you need to sit down and you need to create simple text files, simple documents for how you make decisions. Okay? First and foremost, your decision making framework. And then second, how work is done it. When you have that, and we've done this over the past year, so we have this, we have a constitution, we have key behaviors, we have decision making frameworks, we have everything. It's all in a, you know, less than a megabyte. Which is crazy, right? It's all less than a megabyte, how our entire company runs. I can feed that into agents and they can do work and they can make decisions similar to how, how we would make decisions. Are they gonna be do the work the way we would? No. That's where we're going. And I think if there is one thing I try to stress in every conversation, every keynote, every time someone asks me this, take the time right now and write down how your company makes decisions and what those simple processes are. And the benefit, Lori, to your point, is also great succession planning and, and great organizational design and all of the benefits that come from that. And so, like, if you can, where, where I'm coming in is saying, how can we marry those two things together? How can you do that work? And then also prepare for an genic future, uh, that is coming. Whether it's six months, one year, two years, it doesn't matter. It's coming. Whether you build widgets, whether you're, you know, run a spa, it's coming. It doesn't matter. And so like the, the folks that do that today, they're gonna lap the folks that don't very, very quickly. I'm a hundred percent sure of this. So how do you know that? That to me is like, take that advice and then how do we make it miles into that genic future, right? Yeah. Which is, you know, your job. That's what you do. That's your

Laurie Barkman 45:52

job. That's your job.

Patrick Patterson 45:54

Well,

Laurie Barkman 45:54

I've been doing a bit of a thought experiment on an art influenced by an article written by Sam or an interview with Sam Altman and Forbes. I dunno if you saw it, and it was a very, very small part of the article, but because I'm so tuned into succession ideas, I picked up on it and I was like, oh my God, this is a crazy idea. But okay, let's talk about it. Sam Alman basically said that his successor as CEO is ai. Oh. Oh, oh, wow. Right. How do we think about that? Um, I kind of put it out there in the LinkedIn sphere just to see what people's reactions were. Um, we like, kinda like, but your take, you know, and a lot of people, as you might guess, we're super skeptical about it. Like, let, let's think about that for a moment. Right. Could and should, you know, there's sort of a debate on the should part too. Could it, could it happen? And I, as scary as it is and as unfathomable as it I think it is, I actually think it's gonna happen. I think we're gonna have a role that is an a, you know, a CEO successor is gonna be AI tools.

Patrick Patterson 46:58

So I mean Yes. Right. If you, if you've followed me at all,

Myles Biggs 47:05

but just like I built it already,

Laurie Barkman 47:07

it's like I have

Patrick Patterson 47:07

that right now. Yeah. No, like it's it like

Laurie Barkman 47:10

digital twin,

Patrick Patterson 47:11

but I think. So, you know, this is interesting. So you and I came up through education when online education was just coming out, right? And I remember those first classrooms, it was text under glass. It was taking exactly what you did, uh, in the classroom and converting it to online. And it was the exact same experience. And I, that was really important for the transition. A no one knew what online education was, right?'cause it was just being invented. So that was important for the transition, but it's also important for the change in management because people felt comfortable when a Socratic method of, of learning and that this is what it was and there is a man on the stage and all that fun stuff. And so we tried to recreate that as much as possible in the online education space. I think the same thing is gonna happen with ai. Where we're used to what an organizational design should look like. There's a CEO at the top that does certain things, and so we're gonna start to artificially recreate that text under glass with agents and ai. And so, yes, I think eventually there'll be a quote unquote ai, CEO, because that's what we call that position now. But I think what will evolve is how's the human in the loop interacting with that? And the roles will change, the people will change, the things will change, and we'll find new ways of working where the role of what A CEO was, or A CFO or an intern, it doesn't matter. It's just gonna be different. And so we may call them different things or whatever. Like I can tell you right now. Since, uh, Opus four, 4.6 and, uh, codex 5.3 a a week ago. Is that a week ago?

Myles Biggs 49:11

I think so, yeah.

Patrick Patterson 49:11

A week and a half ago. Holy, my, it'd be longer

Myles Biggs 49:13

after this

Patrick Patterson 49:14

comes out. Yeah, I mean, whenever that came out, it's, it's February 18th when we're recording this now. So, um, hello From the past and, you know, the, I mean the technology exists where I could see 90% of decisions being made by an AI system that I make 90% Now. Should it, that's a different question,

Myles Biggs 49:40

right?

Patrick Patterson 49:41

Can it today? Yes.

Myles Biggs 49:42

Yeah.

Patrick Patterson 49:43

But then that leads us to an interesting question. I'd love your, I'd love your perspective on this. So what, and I'll, I'll, I'll tell one more story. Uh,'cause I, I talk about this a lot. So you, you're, you were in board meetings. You created board decks, you know, running a, a large,$150 million organization have worked with publicly traded, you know, what a time sink and time drain that is. Right. And so there was a, it was like a year and a half ago, and this wasn't even on the latest models. They took a board pre-read. They, they put it through, uh, I think it was like sonnet 3.7 or something like that. It wasn't even Opus at the time. And Claude, and they asked it to act as a board and give feedback and then they had the board meeting four hours pre-read, bunch of people flying in, very expensive everything. And then they, they, they asked for their feedback and they compared, this was a year and a half ago, the LLM with the board. What percentage do you think, miles, you know, the answer to this. So you're not allowed to, you're not allowed to answer. Um, I'll give you, I'll give you the answers so you don't have to guess. 85%. Of what the board came up with, the large language model came up with. Cool. Does that mean we don't need to have the board meeting? No. That means we should do that work, have that in the pre-read so that we can talk about the 15%. And that, I think, is the huge fundamental difference of where we're going. And that fundamentally changes the CEO role. Like how does, when you hear that with your experience and your background in marketing and in investments and, and PE and like, where, where do you think it's going?

Laurie Barkman 51:32

Wow. Oh gosh. I mean, it's, it's like, uh, sci-fi meets succession, you know, it's like, I think this movie will play out at some point. It's gonna scare the f outta everybody. But I, I agree with you that it's, it's happening for some companies today. I think it's gonna be a small, a, a, a trudge and a slog for others. I think that. Yeah, there's definitely a leapfrogging for the ones that are well positioned to sustain changes in the industry. I mentioned the notion of anti-fragile earlier. It's a book, if you've heard of it all.

Myles Biggs 52:13

Yes. One of my favorite, I've read it because you recommended it. Oh, there you go. There

Laurie Barkman 52:15

you go. Yeah. And so I think, you know, there this, um, I can't remember the author's name. He had, uh, produ written the article. It was out on Twitter X and you know, again, I got millions of views. He's basically an AI systems developer and he wrote this article basically saying, Hey, to the everyday man or woman you know, who's working in, in America and you have a role in a company and what is ai? If you're not paying attention to it, what does this actually mean to you? One of the things he included in the article about things to think about was actually financial, like. If you're in a role that could be disintermediated by ai, well don't be taking out a lot of bank loans and shore up your kind of personal net worth balance sheet. And I thought, wow, that's really interesting. I mean, you could take that from a personal kind of financing standpoint. You could also look at it as a business. So if you're, if you're in the built environment, like I was saying, I mean maybe those businesses are a little more insulated, not a hundred percent, but they're anti-fragile.'cause we have to have, we have to have HVAC technicians coming to the house and fixing our boilers. We just do.'cause it's very important. Yeah. Um, or when our AC breaks, so gotta have a technician come out. Right. So that's kind of the, the mechanic, the mechanical. Right. Um, there are, there are businesses that are at risk. Completely being disintermediated. Absolutely. And then there are roles that are gonna be disintermediated. So if we put our head in the sand and say, oh, it's not possible, it's not gonna happen to me, I think that's a dangerous thing. And if this conversation does nothing but help people who are business owners or you're an individual contributor, it doesn't matter. I think the message that we're trying to convey is that, look, AI can be helpful and we have to get ahead of it. And it isn't easy, right? There's no one thing to do. There could be many things to do and try, but just starting and just trying. Even me in my, in my practice, I'm using AI every day to help me make more impact with my clients every single day. And it's just incredible. Yes, it saves me time, but if I didn't ask the right prompt, that prompt wasn't gonna just manifest itself, right? So, uh, it's my brain that's thinking about, well, what tools are helpful to my clients? And then I'm creating them with the help. It's helping me do it better, faster. Right. And so the encouragement that I have is, yes, the lowest common denominator, easiest thing to do. What is it? Chachi, pt. Great. Pay for it. You know, pat, I heard you in a talk. You're like, pay for it. Make sure that it's toggled off that you're not sharing your data, which I tell all my clients. And the other thing you had said in the presentation was all CEOs should be using AI and encouraging their people to use it too. And I actually say that to my clients now, and I've been encouraging them. I have a 65-year-old client, California. Oh my goodness. It's like change their world of how they do proposals. And, um, one of my favorite newsletters is AI Rundown. Did you get, did you get that newsletter? Uh, a little props to the newsletter. Uh, I think I,

Patrick Patterson 55:22

I think I get that. Or

Laurie Barkman 55:22

rundown ai. Yeah. Every day. And so when that, we were talking about the, the announcement about, um, Opus came out. I remember reading that. I was like, oh, this, this sounds really important. And then, um. Yeah. So one of the things in the newsletter that they do is they have like a little, a little like kudos and little wins section of how are you using ai? And I read that section every day and I actually save all these emails.'cause I think one day I am gonna have like an AI bot, like create a summary for me or something. But anyway, that

Patrick Patterson 55:50

day's today,

Laurie Barkman 55:51

that

Patrick Patterson 55:51

day, let's do it. We'll do it right after this. We'll do right now. I'll show you. It'll be fun.

Laurie Barkman 55:54

Um, you're gonna teach me. Yeah. And so my point is, is that the wins that I read about are not super comp complicated. And they're great examples of how to just step into it. So if you're listening and you're thinking, ah, I can't do it, and you're kicking the can, no, don't kick the can on it. Because it even goes back to your question earlier, like, well, how can AI create enterprise value? Is it creating enterprise value enough today? I believe we, we, we should lean in on that.

Patrick Patterson 56:19

Well, and so there's, there's two points here. So I, I don't wanna lose either of'em. The first one being, um, just get started. Just jump in. Try it with something simple like I, this is, I don't know how many people you've ever seen their, when they've, when they've shared their screen on a, uh, on a TV for a presentation and they have like a million icons on their desktop. Have you ever seen these people? Are you one of those people? Anyone wanna admit it? No,

Laurie Barkman 56:43

I've cleaned it up.

Patrick Patterson 56:44

Okay. Cleaned up. How about you? A bunch. I

Myles Biggs 56:46

don't have a million, but I have a handful of just

Patrick Patterson 56:47

random up things. Right. You know, you know how many I have one. Um, and so, but no, so like, and it's unmanageable. You know, I, I, I know someone inside the organization, they have like 10,000 files. I'm not even kidding. On their desktop.

Myles Biggs 57:02

That's terrifying.

Patrick Patterson 57:03

Um, and so here's a great use case, Claude Cowork desktop app. You give it access to your desktop and you can, you can give it access to a specific file so it's not gonna go crazy and or a specific folder. And you say, Hey, organize this one sentence. It's not coding. What if you had to do that programmatically three years ago? It would've taken days to write something. Now in five seconds, you can organize 10,000 files on your desktop. So I did this, I did this, uh, a a while ago. I found voicemails from my dad since he's passed. Wow. Uh, that I hadn't listened to. And, you know, I found photos that I, I thought were lost. I have found documents that brought me back to the good old days with Lori. Um, it, it was, it was phenomenal. And his one sentence, very easy. And to me that showcases those easy use cases. Lori showcase this, this like unlock of what's possible.

Laurie Barkman 58:13

I love that. And I love the good examples too. That's such a good example. And so everybody could think about what's one thing, what's the pebble in your shoe? Just one thing. And if you could just create a question and chat JPT to say, here's an interesting use case. So back to my son and my dad was experiencing some health issues. My dad's 88 and he's taking all these meds and things and my, so my son says to my mom, you know, you can take all of Grandpa's medications and put it in Jet GPT and see if there's any side effects and blah, blah, blah, blah. And she did. And she's like, and she calls it, not Siri, but like she has a name for Jet, GPT, I don't know Sarah, whatever they calls it. She's like, yes. She came back and she said that, blah, blah, blah. And so then she took that and she went to the doctors and talked to them. So self-advocacy for health is like a whole other topic, but nonetheless, I thought, you know what, that's just an amazing thing. Like how he, just that one simple question of how could I live better?

Patrick Patterson 59:13

Yeah. You

Laurie Barkman 59:13

know,

Patrick Patterson 59:13

I mean both, both of the examples are that way. And I, and then the second point kind of dovetails into what we just said, but like, this is not. I mean like capital NO ot, not about efficiency and, and, uh, purely automating work. This is not what AI is about. Everyone jumps to, and I, and I railed against it three years ago, and we, we are not an organization that did this, but like, I'm gonna lay off my entire ex staff and replace them with ai. Like, that is a complete wrong whatever. A if you think that AI is purely an efficiency play, guess what you're doing? You're racing to zero. Okay. Where the companies that are gonna win, which is why I love working in marketing, is how do we use AI to create value? Going back to your value drivers, right? Not, and like yes, is margin a value driver for sure, right? But like, you know, what else is value, value driven, organic growth. You know what companies who wanna buy you care more about than margin organic growth. If you're gonna unleash AI on anything, unleash it on organic growth like today, not tomorrow, not yet, not, not like five minutes from right now. Unleash it on organic growth. So think about that pebble in your shoe. Think about organic growth and building value as the number one value driver. There's nothing else. And say, what is one thing I can solve for today with these tools? Is it proposal writing? Is it research? Is it outreach? Is it thought leadership? Is it, you know, whatever It might be the thing that you're like, oh man, I really would like to know X, Y, or Z. Guess what? You can connect HubSpot to Claude. Ask it questions. You don't need an analyst anymore, right? It's like, oh, I can't afford an analyst. Great. You, you, you don't, you don't need uss 20 bucks a month. Right. And so, and then how do we use those insights? And then you can do things like, I don't understand that. Tell me about it. Right? Hey, go to HubSpot and pull all of my, all of my information and tell me what we're avoiding. Like those questions, that's gonna create value. That's what I'm excited about.

Myles Biggs 1:01:37

Can we go back to anti fragility for a second? I

Patrick Patterson 1:01:38

would love

Myles Biggs 1:01:39

to, because we've said the word, but we haven't really defined it. And I'm sure people are listening, going, what is that? Or worse yet, they're just thinking it's the opposite of fragile, which it's not. So would you, do you wanna take it away, Lori? With

Laurie Barkman 1:01:49

I'll do, I'll do my best. Um, I think it's a recognition that there are situations we can put ourselves in, either as individuals or businesses where we are at risk, versus controlling the risk and setting ourselves up with a little bit of a protective moat. That's how I envision it. How do you see it?

Myles Biggs 1:02:15

Uh, I'm probably gonna botch the exact definition, but my recollection was it's the notion that, you know, when you inject stress into a system, fragile systems will break. And anti-fragile systems actually feed off of that. The, the stress makes it better because it's, it's testing it and they're, you know, growing from it versus breaking from it. And so this whole conversation is an example of if you're anti-fragile, you're the person's crying, wo was me. Hey, I was getting replaced my job. And you're breaking under the stress of this new thing. And anti-fragile people and anti-fragile companies are excited about it, fueled by it, and becoming better because of it. Um, Patrick, third, third definition.

Patrick Patterson 1:02:52

No, I think, I, I, I think that's exactly right. Um, you know, to me it's a lot about grit and tenacity. Um, you know, the. The person, the organization that is saying, you know, oh, I don't need to worry about this, is not building those systems. Those are, those are gonna be the systems when, when Lori, you're talking about like risk profiles and, and, and valuation. Those are gonna be the systems that get stress test during that process. And, um, that's what you need to be focused on. Like, we, a really good example of anti-fragility for us is that modular architecture that we're talking about. Because like, and I, and I remember three years ago when I was doing ai, you know, keynotes to about chat, GBT, everyone was like, I'm gonna train my own model. I spend a year training my own model on I'm gonna hire engineers. And I'm like, that's a terrible idea, right? Like that is a terrible idea. Like you're never gonna beat open AI or Anthropic or Google, you're just not. Or now Grok who's entered the same. And so like, I think for us, like Opus 4.6 came out a week and a half ago, great, change it out. None of our processes deter, de depend on one model. Or we don't wanna use this CRM anymore. We wanna use this one guess. Guess what? It's one MCP call line that changes our agents talking to HubSpot versus Salesforce. Salesforce, right? And so now I don't wanna underplay changing A CRM. It's very difficult, time consuming. But um, you know, I think that is a. When you think about what's going forward, and Lori, I'd be interested to hear your recommendations, what are the areas that you recommend people looking at as they try to build an anti-fragile organization outside of AI and technology, but just anti-fragile organization, period.

Laurie Barkman 1:05:04

So I'll look inward just to kind of start with that example. Um, in my practice, what I find is that you could go online and you could query and you can listen to podcasts about how to build value in your business, how to transition your business, how to do exit planning. You can read that, that information exists. I did not create it and I did not have all the answers. Where I find in my own practice of being, I think, which is an anti-fragile business, is because I know from experience that owners aren't confident and not finding the clarity on some of these big decisions on their own. So it's not the information that I have. It's the ability to help them unlock. You used that word a couple times. It's how to help them unlock and finding the answers that are just captivating their mind. That to me is anti-fragile because I cannot be replaced easily. You see what I'm saying? So if that concept holds true and we say, okay, in a business, what is that aspect of our value add to our client? Our client needs to be willing to pay for it and have consideration, right? Consideration means there's some money exchange. So what value are we creating for our clients that they can't do themselves? So it isn't about, because I thought, oh, I should create an AI system, and like you said, I have an LLM and all this sudden on my book, and I was like, I'm like, no, why would I do that? That's a waste of time. I mean, you're probably looking at me like, no, you should do it, but whatever. No, I'm short. I short try. But my point is that I don't have the infinite, infinite. Knowledge of proprietary information. That information exists elsewhere too, right? Others have, have that information as well. So it's out there. Um, so there's tools that we can create fine. Is it the tool that becomes the competitive moat and helps us be, um, antifragile? I don't think so. I don't think it's the tool. I think it's being that knowledge worker and understanding the psychology of your, of your business client. In my case, it's business owners to help them ultimately achieve what it is they need to achieve.

Patrick Patterson 1:07:15

Well.

Laurie Barkman 1:07:15

So how that gets translated across different companies, I think, you know, will manifest differently. But that's how I see it.

Patrick Patterson 1:07:21

Yeah, I think that's, I think that's exactly right. Have you guys noticed like the word moat?

Laurie Barkman 1:07:27

Yeah.

Patrick Patterson 1:07:27

In the past, like two years or year or six months? Well, I, it's like everybody's

Laurie Barkman 1:07:30

using it. Well, I use it. I, I've been using it for years. I, I give credit to. Warren Buffett.

Patrick Patterson 1:07:36

Well, yeah. Yeah. Right?

Laurie Barkman 1:07:37

Yes.

Patrick Patterson 1:07:38

Well,

Laurie Barkman 1:07:38

competitive moat

Myles Biggs 1:07:39

just makes me wonder,

Patrick Patterson 1:07:40

porters Porter, what is it? Porters, five forces and all that? Yeah. Well,

Laurie Barkman 1:07:43

there's Porters five forces, but the way I use it when I talk about value, value drivers is, um, competitive differentiation. So I talk about the moat, and then I quickly jump into what, what is our competitive differentiation? Why do our customers buy from us versus anybody else?

Patrick Patterson 1:07:58

And I think,

Laurie Barkman 1:07:58

and if we don't know the answer, we need to find out.

Patrick Patterson 1:08:00

And I think that right there, right, that is the, that is the big question. That's the question that will never change with AI or otherwise. Right? And that's the question we ask ourselves. Uh, and, and I think our teams, we all ask ourselves like every single day is, and it, and it, and there's probably two lenses to look at that it's today, how do I create value for my clients in three years? How will I create value for my clients? And they're both valuable questions to ask. One is gonna create long-term value and one is gonna create short-term value. And I think a lot of people are really good at asking the short-term value question. Thinking about it today, with how uncertain three years is from now, it's very difficult to think about that. So you have to think through, I think you talked about it, it, this has been a masterclass and a lot of information that you could unpack any 10 minutes in this podcast and probably turn it into an an another two hours. But like you talked a, a, a little bit about, um, you know, how do you, you know, when you're creating value inside of your organization, like how do you do the things that could never be replaced, right? And so you talked about events, pr like construction building things, right? Like, think about your business, think about what you do, say what is the actual value. That you're bringing. Because what's interesting, you've been in advertising, you understand like the value we bring is not ai, I promise. That's a tool to enable our strategy. It's not the strategy, right? What we bring is what agencies have always brought. We bring speed, we bring expertise that you can't get in-house. We bring knowledge across multiple industries and we bring knowledge across multiple platforms.

Myles Biggs 1:10:03

No.

Patrick Patterson 1:10:03

Does any of that change if we have ai? Absolutely not. Right? So those are the things you need to lean into if you're gonna, if you're gonna build a successful organization. Not the other things, not the, we're gonna have AI that does it faster and better than everyone else. Like that's part of it. Speed is part of it. I think speed is, is part of the, it is one of the new moats, but like I think you have to like drill down into why people need your business and need your service and then. Focus all of your time and energy in building technology, tools, people process around enhancing those things.

Laurie Barkman 1:10:40

Yeah, I think that's right. It's so funny, I was just thinking about my, what I said earlier about what's old is new again. And I remember on the whiteboard when I was at that startup, I was telling you about the SaaS HR startup and our founder had written on the whiteboard, speed is life. Well here we are, right? Like that thematically hasn't changed. How we enable speed is different, um, and being better at it.

Patrick Patterson 1:11:02

Yeah,

Laurie Barkman 1:11:03

the tools and other things.

Myles Biggs 1:11:04

So as, as Patrick said, this has been a masterclass and really appreciate your time across so many topics. Um, you mentioned a few resources throughout casually, but I wanted to ask specifically now where people can find more of you. You mentioned a book and some other things. If people wanna contact you and continue this conversation, where should we direct them?'cause we could throw a bunch of links in the show notes.

Laurie Barkman 1:11:22

Yeah, no, that's amazing. I think the easiest thing to point people to is my website for Lori barkman.me. So my first name is L-A-U-R-I-E, so Lori barkman.me and they can find all the goodies there. My podcast, my book, how to get in touch with me, some of my services, and yeah, look forward to connecting with people.

Patrick Patterson 1:11:41

Before we go, you travel back in time. Lori, you probably asked this on your podcast, but you travel back in time. You, you, you can say one sentence. To your former self, uh, before you started your path down American Eagle Outfitters, before you went into EDMC, before you went into, uh, you know, the, the next phase of your career, the startup, um, what's, what is you, you only get one sentence. What is it?

Laurie Barkman 1:12:13

Be more of a risk taker that you want to be

Patrick Patterson 1:12:18

Difficult. Difficult. Right. And you know, mine would be invest in Apple

Myles Biggs 1:12:25

to the exact same thing. Buy Apple stock.

Laurie Barkman 1:12:27

Buy Apple stock.

Myles Biggs 1:12:28

I'll say Google one

Patrick Patterson 1:12:28

instead.

Laurie Barkman 1:12:30

Oh, I have a funny Google story.

Patrick Patterson 1:12:32

Go ahead.

Myles Biggs 1:12:32

I got one.

Laurie Barkman 1:12:33

Yeah. Okay. Yeah, let's do it. So this is back from the, uh, early days archive. Fun fact. I was the first person in American Eagle to do Google ads. Tracked 40 keywords on the spreadsheet, tracked ROI on the keywords, what, you know, what we sold. It was easy to track. I remember having a conversation with our CFO and he was like, why are we doing this? And I said, look. And he said, okay. And that became the unlock that obviously they've never looked back.

Myles Biggs 1:12:59

Yeah, that's amazing.

Patrick Patterson 1:13:00

With that, with that, if you don't mind me asking, why did you do it? When you look back at that moment, like what, why, why did you use, why, why did you start digital advertising on Google? Why did you track those in a, in a spreadsheet? Why not just do what everyone else was doing?

Laurie Barkman 1:13:22

You know, that business at the time was not on the bleeding edge of technology. We, our strategy was to be a fast follower. And when I was looking in the market, not only at retail, but just what was happening in digital marketing space, I got all the newsletters right. Everything, every day you just sort of read. And I was constantly seeing, oh my gosh, everything's happening. What are we doing? What are we not doing? And that was just one of the opportunities that just seemed like. You would capture, you would capture people who had search intent for product. And then the other part of that was more controversial, especially with our CFO, was capturing brand intent. So if they were searching on the brand name, I was buying the keyword and then the, the debate was, well, they already know our brand name. And I said, yeah, but it's still worth it. Look at the ROI. It was crazy. Yeah, it's a crazy

Patrick Patterson 1:14:15

ROI

Laurie Barkman 1:14:16

and I, you know, that was part of it is just, I think for me, when I said about risk-taking, I've always been a bit of the internal maverick because I think in my heart, I've always wanted to be an entrepreneur, but I never had the big idea and I never had the risk profile. So the way that my entrepreneurialism manifested, especially in Big Co, was to push the envelope in, in my specialty area, which was marketing. And test and learn. Test and learn. I always had a budget. I was fortunate to have a budget for testing and learning and, and then kind of feed that back in and try new things and always sort of being out there. And that was how my intrapreneurialism was flourishing. Now, in my fifties, again, I'm a Gen Xer. I'm finally the entrepreneur I wanna be. And so that's why I said what I said about the risk taking. I probably, if I think I was gonna rewind to my MBA self in 19 97, 98, is I would've bought a business. I didn't know that was a thing. I didn't know I could go get an SBA loan. And if I, if you go back to what I said earlier about people believe in you as the entrepreneur and then everything kind of follows from there. I think I kind of, I could have gotten the funding for honestly anything I wanted. I just didn't know. I didn't, I wasn't a technical founder and I was sort of intimidated by that and didn't have the idea, yada yada. But if I was gonna buy an existing business and run it myself and then. Take it to the next level and then sell it, and then do, that's a career a lot of people talk about now. It's very popular in the mindset of MBAs graduating and, and there's lots of folks saying, oh, you can buy a business with no money down. Okay. Um, but it is another form of being an entrepreneur and there's a form of risk taking in there. So I think that's more than a sentence on, on that, but I just wanna add a little color as to why I said what I said.

Patrick Patterson 1:16:05

Well, I think that that is just an, uh, you know, you expanding on your sentence of risk taking, right? Buying a business is risky. Ownership is risky. You know, I, I, as someone who had their, their house on the line, I, I know what that feels like and it's, it's not easy. Um, you know, the, the, so I think, I think it's great advice. I think it's, it's amazing advice I have. I have had the pleasure of knowing you now for 20 years. No, 20 years. Yeah. Hold, let's never say that again. Yeah. Um, that's a long time. Play back, play it back, and. You have always seemed to have this ability to build great teams and to find great people and knowing some of the people that you've worked around and worked with and hired directly and managed, like they are phenomenal people. I think when we started our business, we actually hired a bunch of those people. Uh, and so, you know, do you have a secret sauce there? And, you know, as, as someone who's has, has gone through this, you know, any tips for folks that are out there, you know, trying to figure out how do they, how do you get that next person at, at whatever stage, uh, that you're in, in your business?

Laurie Barkman 1:17:15

I think if a vision, if you have a vision and you're excited about it and you can enlist people in your vision and get them excited and then they see the impact that they can have as part of that team, it's super powerful.'cause at the end of the day, you know, you want the right fit, you want the right people in the right states and not on all that. So if you can. If you can kind of boil it down, this is my favorite framework for, for interviewing and or hiring. So when I was interviewing for the CEO position, as you can imagine, I'm a researcher, right? A marketer. I'm like, oh, well how do I think about interview questions for CEO role? I had no idea. I had never interviewed for one before. So I found an article of Forbes and it said that there's a framework, and I was like, okay. So I've stuck with it. And the framework is this. Every set of interview questions is real one or one or more of the following categories, strengths, motivations, and fit. So if I ask you, miles, what are your strengths? And you answer, that's obviously a strengths question. If I say, miles, what are your weaknesses? That's actually also strengths. Question. If I say, why do you wanna work here? That's a motivation question, right? And then a fit question would be something like, um, you know, what is it that you like to do in your free time? Who are the people you work best with? So I think that framework works well. I know there's like hiring tools like predictive Index and stuff like that, and I've used those tools as well, but I feel like those are secondary. I think in the, in the starting point also, you have to have a pretty good notion of what the role is and what you're looking to accomplish with that role, uh, so that you can get the right people in the right seats. And then really trying to hone in on the strengths, motivations and fit.'cause strengths is like table stakes. You get that from the resume, you get that from backdoor refer, you know, reference checking and things like that. And then it's what's really motivating them and then what really makes the fit. So if your company is clear on its core values and behaviors you wanna see from folks and those are well aligned, you'll know in the interview process hopefully. And then also, you know, and one of the other tools, sometimes I haven't used it always, but is there, um, kind of an above and beyond like. I'll give you, for example, I went above and beyond when I interviewed as for the CEO position, I did like a 50 page deck, a PowerPoint deck that they did not ask me to do. I did my own competitive analysis. I don't know if this website's around anymore, but it was like survey.com or something where I would hire, or usability.com or something like that, user testing. Anyway, um, I paid for that on my own to have people go in and test the sites and they got that feedback. I blew them away. Like I just literally blew them away. Um, and that's I think one of the main reasons I got the job was like I was demonstrating in the process. So for anybody that's interviewing, I guess that's words wisdom, but then if you're hiring, you know, what do you see from folks either in their background or what makes you believe that they are the right people? Oh, this is something else I tell my kids. Um, and anybody else who's interviewing is recall always that the interview process is about being the least risky person. Because every new hire is a risk. We all know that there's a cost to a bad hire, right? Five x or 10 x or whatever the number is. So therefore, what does a hiring manager actually want to do? They wanna hire the least risky person, right? It's just a different way to think about it. So that way when you're having your interviews, you're assessing of these people, I don't wanna make a bad choice. What's, what is it that stands out so that I don't make a bad choice?

Patrick Patterson 1:20:54

Yeah. I think, and, and Miles, this is your world. But I think like, um, you know, when I've looked at my path towards becoming a better interviewer, I think I, very early in my career, I focused on strikes and weaknesses, and then I added in motivation to my interview, uh, as like, okay, that's actually really important if you're not, if you, if you don't want it. Like, so it was like all about get it, and then it was about do they want it? Um. Then, you know, the, the true, the true question is about fit. And do they fit your values? Can they execute on your key behaviors? Are they going to show up? Um, and then, you know, the other, the other, the, the problem when you, when you look at it through only that ven lens, uh, is you have some bias around it. And so you need to be careful about diversity and you need to make, be careful about making sure, because your company will be better if it's more diverse, right? So you want to have someone who thinks a little differently than you, um, so that you have a foil to, to, and, and you're all not running in the same direction stupidly, right? Um, but I think when I started adding fit to my interview, that's when things. Really changed. So I'd love that framework. I love that.

Myles Biggs 1:22:15

You can

Laurie Barkman 1:22:16

borrow

Myles Biggs 1:22:16

it.

Laurie Barkman 1:22:16

You can borrow it.

Patrick Patterson 1:22:17

I'm stealing it.

Laurie Barkman 1:22:17

Hey, you should.

Myles Biggs 1:22:18

I'm going to have the entire hiring team listen back to that part for sure. All right, everyone, that's a wrap on this episode with Lori. Lori, thank you again so much. Thank

Patrick Patterson 1:22:26

you. This was awesome.

Myles Biggs 1:22:27

Amazing.

Laurie Barkman 1:22:28

Patrick Miles. Thanks for having me. It was really fun.

Myles Biggs 1:22:30

Yeah, so be sure to check out all the links. We're gonna put in the show notes for Laura's website or book, all that good stuff. And be sure to hit the subscribe button on this podcast if you haven't yet done so for more awesome conversations like this.