EP 19 | What’s the Key to Scaling and Exiting a Business Successfully?

How to build a business that attracts investors, scales, and exits successfully.

Scott Schwab, entrepreneur and author, joins Paloma Goggins to share his journey from creating a business plan course to accrediting a new school and launching a transparent CBD brand. He explains how documenting processes, proving outcomes, and building trust early makes any startup more fundable and resilient.

Scott also dives into partnerships, governance, and exit strategies, plus practical lessons on product integrity and scaling operations.

Press play to learn how to structure, grow, and sell your business with confidence.

Transcript

Cold Open: Deals And Risk

SPEAKER_00 0:01

In the world of business, not all deals are what they see. Fortunes rise, empires crumble, all with a stroke of a pet. Mergers, acquisitions, hostile takeovers. Welcome to Mergers She Road, where we examine strategies and stories behind the biggest deals in business. Because in MA, the real risks are the ones you don't. Welcome back to another episode of Mergers She Road. I'm Paloma Goggins, the owner of Nocturnal Legal, and your host. Today's guest has an incredible entrepreneurial journey from starting an accredited school to growing hemp and selling a CBD product. He's going to highlight how you shouldn't take no for an answer when it comes to building, growing, and successfully exiting your business. Scott Schwab as my guest today. Thanks so much, Scott, for being on.

SPEAKER_01 1:00

Thanks, Paloma. Appreciate it.

Why A Business Plan Actually Matters

SPEAKER_00 1:02

To introduce Scott a little bit to everyone today. So Scott is an author, a speaker, an entrepreneur. He was the architect of an online business course called Business Plan University. And through that program, he ended up actually getting accredited. We'll go into that a little bit. And then in 2014, Scott authored a book, Standing Accountable, Increase Your Success by Holding Yourself Responsible. And I'm going to let Scott weave some of his bio in as we go through the question. So, Scott, I'm just going to launch right in. You started your journey creating an education platform. Can you share what inspired you and what problem you were trying to solve?

SPEAKER_01 1:40

Yeah, a little bit of it started when I was in college and I was going to school and in the business management program and didn't actually even have to write a business plan. And I thought, well, that's a miss. I have all of my marketing classes, my business classes, finance classes, but nothing that ever brought it all together. And I think since, you know, I graduated in 06, and I think since that time you've had a lot of advancements and, you know, uh pitch contests and universities sponsoring, you know, business plan events. That was the problem that I saw. And so after college, post-college, I really felt like, hey, we need to teach people why having a business plan in place is one of the most crucial things that they can have. And so really that's where it started for me.

SPEAKER_00 2:34

That's so true. I feel like the evolution of entrepreneurial academies has blown up over the course of like the last 25 years. But you're right. Before then, the idea of a traditional business program really omitted the entrepreneurial journey. Um, so true. So early on, what were you, what were some of the biggest challenges you were facing in building and scaling your platform before it it evolved? And I we kind of touched on this in the intro, but I'd love to hear the the portion. So for listeners, Scott and I had a call before this. And one of the things that I would love for him to share today is he started this platform for education purposes, for business plans, which obviously, for anyone starting a business, even if you're not getting a business loan, creating a business plan is hypercritical to align with your goals and figure out how to build your business from the ground up. And Scott had shared with me on this call that essentially he had been told no in this process. And part of it was accreditation. And so, Scott, I'll let you tell the story.

Rejection From Publishers And Pivots

SPEAKER_01 3:36

Yeah, thank you. And I would love to just speak directly to any entrepreneur who is in a scenario where you don't know what you're doing, keep going. Because that was me. I didn't uh do my education in, you know, uh uh an educational program. I personally just had an uh idea and a dream to be able to start something that would help other people. And so for me, it was to start researching what went into a business plan, putting all of those thoughts together and putting them into what would be a curriculum so that it not only tells you what needs to be in the business plan, but it also uh kind of details out why those things are important, like a competitive analysis and you know, a SWOT analysis. We learn these things in school, but sometimes the application isn't always there. And so I had gone through this whole process of writing all of the curriculum, and then I thought, okay, learning management systems are gonna be the future of learning, at least from an online or a hybrid perspective. So I'm gonna build my own. And we went through that process of building a learning management system and putting in all the curriculum and getting all the digital assets, and I take this pretty package to like the first couple of colleges and uh high schools, and they're like, You don't understand publishing, do you? And I was like, uh I guess not. And uh they're like, We're not buying your program, we're not buying the book, we're not actually doing anything with you because you're not uh, you know, McGraw-Hill and you're not a Schuster, and you know, we have our our professors choose the book that they want to use, and you're so unknown that we can't support your business at this point. And I I was crushed, I was defeated, but at the same time, I thought, well, then I'll become my own school. I'm like, I don't have to go through this publishing kind of uh you know pathway, I'll just become a school.

Inside The Accreditation Journey

SPEAKER_00 5:42

I just I love this this part of your story. One, because I feel like a lot of people, when they're running and operating a business and they run into what would be a major obstacle, right? Being told, hey, we don't know you from Adam. We like the program, but you know, you're missing things that we would consider incredibly important for accreditation or something like that, right? And for you to turn around and just say, okay, well then I'm just gonna do it. Like I'm I'm just gonna look them in the face and I'm gonna tell them this hurdle is not stopping me from moving forward. But I think what's even more shocking about that part of your story is that for someone who has created a platform, but perhaps never, you know, gone down the path of creating an accredited school. I mean, how did you even go about figuring out what your first steps were? Because I feel like a lot of entrepreneurs would look at something like that, like couldn't even be an education, right? Just a government contractor or something that requires tons of hoops to jump through. I can just see it being so overwhelming that, like, where do you even begin?

SPEAKER_01 6:50

Yeah, great question. And I I looked at it in a couple of different ways. I felt like a textbook was something that could be valuable. And so I did start reaching out to publishing company companies and ultimately chose Scottsdale Publishing. Um, and it was a good fit for me, right? But I wasn't my intention wasn't to just become a textbook and wipe my hands of it. For me, it was the platform that was the genius of it, and the developers and how much time and energy that they put into it to where you could work in kind of segments, but it would take that information and populate it throughout your documents so that you could literally like start writing your thoughts and your ideas, and they would become part of that document segment that would help kind of spur ideas in the other areas. But for me, I knew no one in education. You know, my mom had gotten her master's in education, and uh I thought that that was pretty cool, so I asked her. Um, but ultimately it was reaching out to accreditation bodies, and one out of like dozens finally said, Yeah, we'll work with you. And it was a relationship with Northwest Accreditation Commission, NWACC, and that was the first group that ever looked at me like, hey, we can do something with this. I think that there's something here. And so for the course of 18 months, we just met consistently and went through the course, went through the delivery, went through what the pedagogy is of the uh delivery and the intended outcomes and the syllabi. Like you have to start thinking differently, which is not how I initially started thinking. I was really just like, okay, what does it need to be for a delivery? But they forced me to think differently, which I'm so grateful that they did.

SPEAKER_00 8:40

Well, and I was gonna say for them to be able to, so it sounds like in that process, they were able to kind of hold your hand through the accreditation process and also provide you guidance. So it wasn't necessarily you were out on your own just, you know, floundering around trying to figure it out. It sounded like more hands-on. Okay, that's I think that's really neat. Um and maybe that's a kind of a take-home message too for entrepreneurs who are facing really significant either accreditation licensing or whatever it may be in that specific industry, is to find that person. And maybe it's not a regulatory body, right? Because a lot of times if you're working with the government for regulatory purposes, they're not going to hold your hand through that process. But I'm sure there's someone uh you know attached to that industry that could potentially help you. And it sounds like that was a pretty critical component of you being able to get through the accreditation process.

SPEAKER_01 9:32

Yeah, very much so. I I there's no way I would have gotten through without the help of NWACC or um their, you know, uh leadership. It it was pivotal for me. And so for any entrepreneur, I would say get a mentor, get an expert, surround yourself with people who are smarter than you are or who know things that you don't know.

Writing It Down And Subconscious Drive

SPEAKER_00 9:51

I like that. I also like, you know, just as an aside, that it seems to me from an outsider's perspective that a lot of your, even with your business plan, software, and like the platform, right idea, um having it kind of build with blocks, same idea and concept. It sounds like when you went through the accreditation, you're like one block at a time at a time. And I think a lot of people, when they look at really big, insurmountable issues, they don't realize that if they just take it one step at a time, it will eventually come to fruition, right? But I like this kind of theme you have going on, which is like building things out one part at a time to eventually make a whole. And I want to go back to the business plan because I can guarantee you that the majority of entrepreneurs who are successfully running their business, not startups that are just thinking about what they can do to get their stuff right, don't have a business plan. And I I want, because you've spent so much of your time and your history in this space, the education space, around helping business owners and new entrepreneurs create business plans, you know, what what would be your suggestion for someone? Like, is it ever too late? Right? We we we kind of know the answer to this question, but Scott, if you could just explain some of the positives around why a business plan is awesome for for people who are listening and thinking, oh, this doesn't apply to me. I've been in business for five years.

SPEAKER_01 11:20

Yeah, I I have many thoughts. Um, I think the first thought is it's great to be organized in any type of a discussion. And most investors, most partners, most people who want to engage with you, even consumers, they're gonna want to have some idea of what makes your product unique or what makes your business unique or special. And I think that that's where it starts for everybody is really just writing out your ideas or how you're solving a problem. I think one of the biggest things that a business plan should really detail is the product market fit. Because if you don't know how your product fits, then you really don't have a business or even an idea yet. And I don't want to be harsh and discourage people. It's more or less like, hey, encourage you to take that idea that you've had that you've told a couple of friends about, take that further. Maybe understand who else is doing that thing, whether it's a product or a service, there's always somebody else doing it. Now they may not be doing it in the way that you want to do it, and they may not do it in a um in the type of way that you can see the opportunity, but that's the beauty of it is you've got to be able to detail that out. And that's where in my mind it all starts with an executive summary of you writing out your idea and sharing about all of the aspects of your thought process. Because that thought process will say, okay, how do you sell it? Who's going to be involved? Why is this market an interesting market? Like what is the total addressable market or your TAM? You've got to know those things if you're serious about the business. Um, and you don't have to know everything, but you've got to know some key components to attract other people to you, whether that's partners, investors, customers, you've really got to be able to tell people or share your business with others if you want it to be a success.

Values, Competency, And New Models

SPEAKER_00 13:20

I think the idea of putting your ideas and your thoughts on paper can be so powerful and people forget about the power of writing down, whether it's on a computer or even in a notebook, um, writing down what your goals and your plans are for your business and and how critical that can be to success. I was lucky enough, I took one course when I was in law school that was about starting a law firm. And I didn't know if I would ever start my own law firm, but I was like, I'm gonna take this course just in case I do. The irony of it now, looking back on it. But they forced us to create a business plan. And in all honesty, I'd kind of forgotten about the business plan that I had created. It had been so long ago. And I stumbled upon it actually. And it was funny the timing of it, the irony, because we were gonna have sit down and have this conversation, and I knew the platform was about business plans. And I found it in my drive, and I was like, oh man, I'm blast from the past. So I opened it. I was like, man, I wonder how much of this stuff I've actually done, right? Because you got to use it, you have a marketing section, right? What are you doing to market your business? What, who are you gonna serve as your customer, your client? And I was so pleasantly surprised to find out that I must have just absorbed all of that because it was a huge project in the class. So it of course was like a you know big thing for me at the time. But there were so many things that I had been doing in my business and I hadn't even realized that I had written it down. So I think even if you don't think you're ever gonna use your business plan, I think me finding that old one and realizing I had done exactly what I had told myself to do, you know, like eight years ago, I think uh, you know, stands to the testament of the practice of doing a business plan, even if you're not taking it to investors or private equity or whatever it may be.

SPEAKER_01 15:00

Yeah, Paloma, I love that you brought that up because I don't know if we always understand the power of thought and the power of dreams and what's going on behind the scenes. So a lot of times we're, you know, cognitive of what our, you know, consciousness is, like how I feel, how I think right now in this moment. But I don't know how often we're really tuned into our subconscious. Some of the things that happen when maybe we're not told to think about anything. What is it that we dream about? What are the things that we are interested in? How do we treat people? I think all those things show up in subconscious. And uh I think that there's a loop between subconscious and conscious. I think that we see that in dreams, but I also see think that we see that when we're down the road enough to be able to look back with a little bit of wisdom and knowledge and say, that came from something that was a seed that was planted. Maybe it was by somebody else or maybe it was by us. But I really feel like subconscious feeds conscious if we'll allow it to, and then consciousness reinforces subconscious.

When Interest Builds And How To Exit

SPEAKER_00 16:08

I could not agree more. And honestly, we could probably have a whole podcast episode about the power of thought and and having things uh really kind of get absorbed right in your subconscious and making it a reality. But I I I really couldn't agree more. And and two, I think people always talk about how your vision and your goals really drive not only your life, but your business, right? And I think a lot of people underestimate that when you're when you're thinking about your business and on such a micro level, like you said, the seeds are being planted to grow things that maybe you hadn't even thought about, right? I I had recently read a book. Um, and I I always want to call it a moment to think. I can't remember if that's the actual title, but the the it the book is awesome. It pretty much just says that we need white space in our life, right? And the white space is for us to think about things and just daydream. And with the phone and the internet and Netflix and everything else going on, there's so little white space left in our lives. And I think it's it's kind of sad and unfortunate because we don't spend that time with our brain just kind of in resting state where some of our best ideas just come. I mean, if you're folding laundry and you're like, the best ideas come when I'm just doing the most mundane task. But I'm not doom scrolling, right? Uh, I'm sure you could relate.

SPEAKER_01 17:38

Yep. Um, totally agree. I think that the uh things in our lives are often there because they're intentional. Um, I think that the people, especially that are in our lives, are very intentional. Um, but little things, little moments, we really should be paying attention to those because too often we breeze right through everything, like you talk about the doom scrolling and the time on the phone, it really is out of hand. Um, but none of us want to admit it. And none of us want to admit that we're part of the problem. Like I have the problem myself. And at times I have to cognit uh cognitively say, no more. I can't, I can't keep doing this and go and do something. But again, time on the phone isn't the uh worst thing in the world. Um, but at the same time, there's gotta be limits and there's gotta be moderation.

SPEAKER_00 18:26

So yes, everything in in small doses, small quantities. Well, okay, so you had this idea, this vision, right? You wanted to create an educational platform for people that were going to be making business plans to help guide them, to help grow their business. You ultimately were growing it, tried to bring it to market. The market said, We don't know you. You're not like the biggest name in publishing for education. And so you're like, okay, screw this. I'm gonna get accredited as like a school, really. Um, I wouldn't when you had first told me this story, I was thinking of that movie. Um, and I I cannot remember the name of the movie. I'm terrible, by the way, at remembering names of things on the fly, but it's like they find an abandoned school and they like accredit it, and it it's like an old movie from the 90s. And I was thinking of that where like everybody's like faking going to college and like lied to their parents, and then they actually get it accredited and it becomes like an actual school. Um, so you've gone through this kind of metamorphosis and you get the accreditation. Was the ultimate goal always to sell the school once it got to a certain size?

Partnerships, Breakups, And Governance

SPEAKER_01 19:38

No, um, I had a passion for education and I just wanted to do things differently. And different to me isn't preventing people uh from doing things that they're passionate about until, let's say, four years or a time frame, right? Because sometimes we put uh qualification in terms of buckets, like, hey, when you get to this point, you can be paid this. Well, I think a lot of what our society is is seeing now is that education can come in a lot of different ways, particularly badges, certificates. And we were always very much forward thinking in that idea that you could take something and do something with it in a short amount of time and get your experience in another way rather than the classroom, right? Maybe it's the classroom of hard knocks, maybe it's you travel and you do a study abroad or live abroad, or why would those be any less valuable in who you become and the ideas that you have and you generate? So for us, it was let's look at uh education and time in a different way. Maybe not time in the seat, but actually competency. And so that was one core thing that we did very differently is we didn't want to just have a certificate of completion, right? Anyone can give a certificate of completion. We wanted accreditation so that we could accredit the learning or accredit the process of someone becoming something enough to where they can share and be able to uh create. And whether that's sharing it with friends and family or whether it's sharing with a global audience or whatever it might be, I believe that we're meant to create. And uh, in some of the ways that that shows up, I love entrepreneurship because it really taps into well, what really why does this matter to you? And why should it matter to a customer base? And so that's what we tried to do differently is really establish ourselves in core values. And and I would recommend any entrepreneur to do the same. Like understand what is your why, and then never let go of that why. Because if you give up, generally your business will give up or it won't make it. It's gonna be on life support if you choose to not give it the time and the attention that it needs. At least that's what I saw over the years of just trying and trying and failing. And, you know, it's years of accreditation, and accreditation reviews are like the most intense audits I've ever been a part of. But you get to the end of it and you're like, holy cow, we did something that never in a million years did I think that we would be capable of doing.

SPEAKER_00 22:23

When you go through an accreditation audit, are they looking? Is is it super holistic and that they're looking at everything with a you know magnifying glass, or is it that they're looking for specific metrics or, you know, I don't even milestones. Like I what are is it an audit, something that is kind of like a tax audit where it's that detailed and that you know introspective? Can you tell us a little bit more?

From Education To CBD Products

SPEAKER_01 22:51

Yeah, it is. It's it's very much the latter, but I do believe that there's holistic moments because it's really gonna depend on who your reviewer is. I was impressed each of the interviews because they weren't there to try to punish you, they were there to try to teach you. And uh many of the things that I experienced was, hey, where's this document? We can tell them anything, but then they're like, show me where's the proof, where's the documentation? Who knows how to do this? Rather than it just being something like, hey, I can tell you, Paloma, all the great things about what our school's doing and how we do it, they're going to press you for where's the documentation? Okay, it's here, but where is it in the program? Like, show me your online portal. Where do students see this? How do you interact with these students or the shareholders or stakeholders within the education? And that might be parents, that might be grandparents. How do you put together a plan if there's some type of like emergency? Like, how are you gonna contact students that you may not necessarily see their parents or they're not coming to a campus? And so there's a lot of things that they're really going to press you on that you have to think through, like, oh, we actually haven't thought about that. And every accreditation is an opportunity to get better. And I've loved the process, but I will tell you, it is one of the most stressed types of uh moments that I've I've ever had because you have educators coming in from all over the world, and they're looking at your presentation as hey, is this something that we can actually feel good about putting a stamp of approval on as individuals? And will our submission to the accreditation body be accepted? Because they still have to review it, approve it, but it's a process that takes months and even years when you're looking at, you know, some of the sizes of programs and the amount of courses, the amount of students. So it it's pretty heavy.

SPEAKER_00 24:57

That's crazy. Yeah. I I suppose the bigger your school and the more offerings you have, the more complex the audit. So you were talking about core values. Was that what kind of triggered or was like the unique identifier for your program that led to someone saying, Hey, I'd like to buy this? Or what like kind of from an evolution standpoint, at what point were you like, I'm I'm ready or I'm okay with selling the school to someone else?

Farming At Scale And Finding Partners

Legal Hurdles, Mistakes, And Resilience

SPEAKER_01 25:25

Yeah, uh, and I think that the first time that that came was in 2016. And I had a couple of partners who came and said, Hey, listen, there's two components to your business that we're really interested in. One is the development shop because we funded the university with a dev shop. And so we would go out and get like different types of dev contracts, um, and we would use some of our students who had gone through our dev program. It made a lot of sense for us because we could have senior level developers train mid and uh junior level developers, but not only that real world experience, but we were sending people out to uh companies that were paying, you know, a bonus or some type of a uh a kickback to us as preparing those developers for higher learning or higher opportunities. And so it was a kind of a cool model where we were able to kind of eat our own cake, which was hey, we bake this cake and you know, we feel so confident in our developers. We're really we're willing to put them out on the market for another company to take. And so that was one of the first pieces the dev shop. And they were a really strong dev shop. So we felt like that was a no-brainer bringing the dev shops together. But then they were doing some trainings with developers, and I was like, well, why don't we just tie this developer training into an accreditation model? And so we launched a boot camp. To that point, we were a school, but the learning model of a boot camp hadn't been approved. And so in 2016, we were one of the first uh boot camps that were approved as not only a learning model, but as its own institution. And so the school then became the accreditation kind of governance and leadership, because anything that you bring into the school has to be released reviewed by leadership and then has to receive an approval, and then you can release any type of a program, whether that be, you know, something that is going to be a cohort-based, or whether that's going to be a class, or whether that's going to be uh remedia learning or remote learning. Like all those things get decided by a leadership core or group. And um it really came together with those those two individuals. Fast forward, uh, some of the opportunities for our own purchase came because we were able to grow and we were able to expand our model. So in 2017 was the first time I flew to Malaysia and met with a family that owned a university in the states. And we worked with them for about a year, and they said, you know what? We know education in Malaysia and throughout China. They had 74 different partners across Europe and Asia. And they said, Why don't you buy our university uh in the US? And we were like, is that even a possibility? And uh it turns out that it was a possibility and that the accreditation body preferred US ownership. Interesting. Um, and so that opportunity came simply because we were uh growing and that we had some excitement around our program, and we were at the right time at the right place. This family wanted to, you know, kind of pass this investment to somebody else, and we were in the right spot to take it. And so then, you know, when I exited in 2019, we had a lot of different groups clamoring. I mean, we had a good valuation, and that was what was fueling kind of these conversations with groups, but ultimately I think that you build something and you never know where it's gonna go. And when people start taking interest, you really should surround yourself with finance uh and legal people like yourself uh to help you kind of craft something that works for you because you could build a company, sell it, and literally not make what you think you're going to make. You can either lose it through taxes or you can lose it through a number of things. But that's why Paloma, what you do, is so great because you're protecting not only the entrepreneur, but the assets. And so I would tell anybody that's growing a company and you know you start seeing interest, get a lawyer. Because if you try to sell this on your own, you're probably not gonna get the uh return that you think. You uh you should deserve or that you're hoping for.

Energy, Health, And Knowing When To Walk

SPEAKER_00 30:03

Well, you brought up a really good point, which is that there there is unfortunately a lot of opportunity to lose revenue on a sale through taxes. And I think a lot of people when they are ready to sell, there's a good chunk of people in that camp that are just ready to be done, right? They're they're not in a position to be patient or to wait. There's a lot of people that are transitioning or have life, you know, happening to them and they don't have an option. And it makes it hard because they haven't done any of that tax planning in advance. And I always try and hammer home. I'm like, the planning stages prior to a sale are so critical to success. And I do think it it's unfortunate that sometimes you know, you get people that just get a cold, cold call or a cold email offering, hey, I I like to learn about your business and maybe buy it. And it's no different than someone knocking on your your house door and saying, like, I love this house. How much will you sell it to me for? And before that moment comes, sometimes you you had no plan to sell. And so you're flattered and excited about something that perhaps you have no um work put into it or any sort of pre-planning to make that potentially worthwhile or for it to make sense. And so I'm glad that you brought up the tax piece of it because it's huge. And to not work with an accountant that at that really honestly knows more about the the allocation, right? I I'm dangerous and I talk to clients, I'm like, I know enough to be dangerous, but I'm also full caveat and you know, um, don't hold me accountable. I'm not an accountant, right? And so I always tell people, I'm like, you've gotta talk to them because you're gonna get a landslide in income. And if you don't have a plan in place or a structure in place, Uncle Sam is gonna take a huge cut out of it. Um okay, so after your exit, I guess let me ask one more question about your exit. So it sounds to me, and I I know we didn't talk about this previously. So it sounds to me like you had exited as a partner in that business kind of separately. It wasn't a 100% sale, it was just a time when you decided to get out. Is that accurate?

SPEAKER_01 32:27

Yeah, I still have ownership in that company. It was just really, it was time for me to be done. I had been doing it for 10 plus years and uh found myself, you know, kind of at a seat in the table where um my opinion wasn't what I had hoped it would be. And so uh that was the time for me to say, okay, um I need to move on. And that's hard for a lot of entrepreneurs, but I I personally believe that you either get to a point where you outgrow your business or your business outgrows you, and uh still trying to kind of figure out what that one meant for me, but uh I needed to do something else and I needed to surround myself with different people because look, partnerships are hard, they're really hard, and you got to put a lot of work at it. And uh ultimately I was in a spot with one of the partners that I either needed to go or he needed to go, and so it was my time.

Closing Reflections And CTA

SPEAKER_00 33:26

Well, and I think it's it's a hard conversation to have, right? Um, and everyone always likes to think that things will be hunky-dory forever, and the reality is people change, situations change, the financial situation in the business changes. I I see that being a catalyst more often than not in in my world that everyone is working well together, and then the financial situation changes, and all of a sudden nobody's working together anymore, and people are upset about how lopsided, you know, someone's not putting in enough effort, but they're getting all of the same amount of money or something like that. And so um I know how difficult those conversations can be. And I think it's also a good reminder to anyone that is in a business that things change, and I I it's hard to conceptualize, right? No different than in our current, our personal lives that you know it's it's difficult to realize and come to terms with the fact that what you have today is not gonna stick around. Everything changes and people in your life come and go. And so something to think about when you're growing and building your business is A, you got to have the prenup for the business, which is like your operating agreement, your bylaws. Yeah, the stuff that helps you have a cordial breakup. And then B, I think too, like a lot of people don't have the tough conversations before going into business. And a lot of people go into business with friends and family, which makes it even harder because if if you ever have the falling out and they're blood related and you gotta see them at Thanksgiving, it can get really uh hairy. So I always tell people look, you gotta have some tough conversations about what the expectations are before getting into business with family.

SPEAKER_01 35:10

Um Yeah, I love what you're saying there, and that conversation should be ongoing. Um, ultimately, like as you've talked about, people come and go, things change, finances change things. You need to be having these conversations all along the way. Like, I'm I currently work with one of my best friends, and we've worked together since 2009. Um, and so when when I look at that, I'm like, it can work, it definitely can work. I think the challenge is oftentimes communication can't happen because we don't want to say this, or it's gonna offend somebody, or it's gonna make somebody feel bad. And in my mind, like you're really putting that much time into something, do yourself a favor and create monthly, quarterly meetings where you're going to have conversations about anything and everything, because sometimes that's not always what you think, but what your needs are from maybe a significant other and what they see that you're not seeing, or how you're prioritizing work above health or work above relationship. And so you've got to have that dichotomy of of conversation because you're in it to build something incredible. Don't let some of these things that are overlooked bring down the business because they can so quickly.

SPEAKER_00 36:30

Well said. No, certainly the ongoing conversations can't hit you know, hit that home enough. It it shouldn't just be at the start. It shouldn't just be when it's hard. It should be conversations should continue to happen, especially as the the business changes and grows, because each growing sort of milestone creates new pain points and different things that maybe you didn't even think about, right? Um so I want to pivot back. I was I was gonna pivot away from uh your post-exit, and then I was like, okay, we gotta talk about that first. But you sold and you still have uh an interest in it, but you essentially kind of took a step back and out of the business, and you pivoted into a business that is product-based. And I'll I'll let you describe the the product and and the why about why you went into this space, but I I think from an entrepreneurial journey, and I had shared this with Scott previously, I think the idea of going from creating an education platform, which is arguably a service, um, to creating a product and then taking it to market and selling it to consumers are so diametrically opposed in the way that you market operate. Um, I I always joke, like I've love my clients that have products, but their world is so foreign to me being a service-based business. And so I I want to, in in you describing this kind of new chapter that you started, I would love to know how, beside the fact that anytime you see a hurdle, you're just like, I'm getting over it. I don't care how I get over it. How how you went from being in a service-based business to a product-based business and and what was the learning curve there?

SPEAKER_01 38:17

Yeah, a great question. Um, loved how you articulated that. I would tell you that even any product business that I know of, um, there's still so much service that is a piece of it. And we always wanted to make sure that that was at our core. Um simply because it's like you really can't build out, uh, in my mind, a business without having some level of service as a part of it for us. It's customer service, but it's also service to our partners. Like we have many different partners who do things that we can't do. Um, initially, we jumped in just to the farming side, and we grow uh a hemp CBD. Uh, this is uh kind of right off of the heels of the farm bill passing in 2018. So a lot of excitement about what that means. For us, we just wanted to understand a crop that would give a farmer a good return. Because farmers don't always get the returns that we think that they do. Um, and so what we wanted to do was provide that. We were three Idaho boys, understood that you know, work had to be a big part of it. But if we could grow this plant right, we could actually provide a product and a service to people because you can look at the hemp plant, there's over a thousand things that you can do with it. What we were farming it for was actually the oils or the CBD. A lot of times people talk about, you know, what those constituents are or those compounds are. And so we approached it very much like, okay, we've got to learn how to grow it, right? That was our first task that we had to do. So we partnered with a farm that was an organic farm, and we wanted to understand, okay, how does this plant grow? What do you need to do to it? How do you need to protect it? What are the things that you need to, you know, kind of put in place so that you have some validation? For us, that comes in the form of tech. And again, kind of leaning into my tech days, um, we uh partnered with a group that uh tests the soil quality to the billionth particle. That's important to us because I want to ensure consumers that there's nothing going on that they shouldn't be aware of, meaning heavy metals or pesticides or fungicides or microbial damage. And so we quickly learned how to grow the plant right, but also to utilize technology like a QR code that's on every one of our bottles that will show a person a COA or a certificate of authenticity. Uh ultimately we want to be able to give them trust and comfort in our products. And uh where it started is not where it's at. I mean, we in a lot of ways thought we would just farm it. Um, but then when the economy and kind of our world changed when it came to products, we knew that we had to get into products if we wanted to survive in the industry because farming wasn't going to be sufficient. So 2020, we launched our product brand, uh, Met Naturals, and uh ultimately have been growing that brand ever since, and then also launched a non-CBD product line called MetWellness, and uh tied in all of that supply chain together through technology. And so there were things that were kind of familiar with our past just because we had done them before. And then when you have the mindset of being very focused on your company or your customer, that's a service-based business in my mind. Um, but we do have it with a product that people can take for their well-being and for their help.

SPEAKER_00 41:54

You're so right. I hadn't thought about the fact that you still have customer service as a component. Um the the thought, I think for me, the thought that blows my mind is like bringing a product to market is such a significant undertaking. And I think it's incredible that I I think the kind of the recurring theme for you in your entrepreneurial journey is like you don't know it, you're gonna learn it. Like you'll just figure it out. And I I love that because I'm that way too. Um, I will throw myself into learning, you know, digital marketing because I just I need to know it as a business owner, and I refuse to run the risk of hiring someone that isn't gonna do the right thing, right? So you're gonna take it into your own hands. And so let's go back in your story to the part where you start to grow the plant because I love I love this part of your story too. It's like, you know, the same hurdle as you know, getting the accreditation. You're like, we want to make a product, we're gonna grow it from from scratch. And I love it. And I love the commitment to making things transparent, right? The the soil analysis component of this is so critical in in a an industry that even when you're just talking about CBD only, there's such a lack of transparency out there about what's going into your product, where it's come from, what they're utilizing on the plant, and so on and so forth. And arguably in an industry that is marketed towards people who are in pain or have some sort of illness. Um so when you decided to grow it, what was your operation like? Were you like, we're gonna start small and and grow it slowly, or did you just dive right in? I know this, I know this answer this question to everyone who's listening, but I'm I'm teeing Scott up for the best answer ever.

SPEAKER_01 43:45

We uh were not intelligent about how we looked at this. We grew 500 acres, which is way, way too much. Way too much. And I think the intelligent uh aspect that we did do is we chose different varieties because we wanted to understand how the the plant grew. But in thinking that like we had just hit a gold mine, we like everybody else jumped in and grew way too much. And even with the farm bill passing, they really didn't set up a good supply chain themselves from farmers growers to extractors to producers, manufacturers. That really wasn't set up. And uh for anybody early in the industry, um, you really had to just dig in and find your partners. And for us, that's been our theme is really just focusing on the right partners because we understood going into it, kind of like we did with accreditation. We're never going to be able to figure out everything that needs to be learned if we just try to do it all ourselves. And so we lean into relationships with partners. And I think that's one of the beauties of entrepreneurship, if we'll let it, is uh let people help us because there's a so many people who want to help and who are excited about what you're doing and want to support you and see you win. And that's what who you need to surround yourself with because there's also frenemies, there's also people who want to see you fail. And it's unfortunate, but surround yourself with those people who want to see you win.

SPEAKER_00 45:24

Well, and I think that is something that people underestimate is that you can grow, you can grow no matter what, but you can grow exponentially quicker when you surround yourself with people who are experts in certain industries or even in just growing or scaling your business, right? And so this concept that you're gonna do it all on your own in a silo, I think sometimes stunts people's growth. And I I think they're a little short-sighted in looking at the investment of working with those experts or those advisors and say, well, you know, I I don't really want to take my my hard-earned money from the business and invest it in in these experts, and in and in turn their growth is so much slower. Um so I like that you met brought up and mentioned that piece of it. And uh, and I I still I think it's wild that you guys you grew such a large amount. So once you you grow, are you guys the ones that are helping to I I guess to get a better idea of how expansive this, the kind of the operations behind the scenes are and and to sort of um answer my own curiosity in my back of my mind is so once the plant is grown and you want to turn it into the product, do you have to send the plant for processing to another company to create the product that you want?

SPEAKER_01 46:53

Yeah.

SPEAKER_00 46:54

When you were going through the process of figuring out who that partner was going to be, I would imagine there's plenty of options out there. Or are you limited? I know so I I used to do a little bit of research and I wrote an article once for the Wisconsin Law Journal about the cannabis and how things were changing in back in Wisconsin. And obviously the farm bill was new and everybody was trying to figure things out at the time. Um tell me, is are you limited to working with people within state boundaries because of the farm bill for processing, or can you actually ship it out of state because you're not selling, you're not technically selling it across state lines?

SPEAKER_01 47:34

Yeah, great question. Early on, it was the wild, wild west. Everybody was really just trying to figure it out. And unfortunately, a lot of mistakes were made. And those mistakes, they were at the state level, they were at the federal level. Now it's kind of settled down to where each state has their own, you know, course of doing business, but everybody leans into the federal farm bill, which is hey, as long as your product is lower than 0.3% THC, then you can pass it between state lines and you can grow it in any state, minus Idaho. Idaho has some um some laws that won't allow people to necessarily retail it uh in the state of Idaho. And uh that that's a tricky one sometimes because we do have retailers who want to have our product in uh Idaho. Um ultimately, though, I think everything's settled down enough to where there's a pretty fair playing field, but um, don't expect to get into entrepreneurship without a lot of mistakes. I've had tons of mistakes, and over the years, I sometimes look back and I'm like, man, all I have is mistakes. But if you look at it from that perspective, it could be pretty daunting, or you can say, Man, I've worked I've learned a whole lot, and I was taught, I was tutored, I was educated, and you know, sometimes the situation teaches you, and it's not as fun as maybe a person teaching you. Um, but each of those opportunities will come, I think, to any entrepreneur, and you just gotta be result enough to be able to say, hey, I've got resolution, I've got hope, I've got a plan, you know, back to the business plan, and we're gonna figure this out. And that's what we've constantly had to do because we've had bad partners. We had a partner that we had to kick off our farm because they weren't doing what they said they were gonna do after 18 months, and then it became this legal battle. And again, it's it's unfortunate that some of the times the ugliness of business, but it's not the ugliness of business as much as it is the ugliness of people. Sometimes people just don't really have the desire to do the right thing, and so again, protect yourself with agreements. We talked a little bit about that, but also just have these communications, and when it comes to the point where you can no longer communicate with somebody, maybe try somebody else who can see both sides, maybe a mediator. Um, but at the end of the day, if in the event that you can't find resolve, you need to find something that's going to not suck the uh negative energy or suck the positive energy out of you and give you negative energy. Because life's too short to be so bent out of shape with everything you can't control. Do your best, give it your absolute, and then find the people that can help you in your weak spots or your gaps. But if it still can't be resolved, my recommendation is that you find a way out of that scenario because you've already given it energy and you've already given it time and you've already given it, you know, your attention, and you're not gonna solve it generally by continuing to repeat the same message or the same scenario over and over again. That's insanity. Uh, to me, it's like, you know, find somebody who can uh help you get through that scenario or you know, move on. And uh it's situational, and I understand that, and I'm speaking general. Um and I would just say that protect your energy and protect your health because in entrepreneurship that's things we never talk about. And I think entrepreneurs really need to be vigilant about protecting what's important to them, and I promise you, your health and your wellness is important, and you have to prioritize it.

SPEAKER_00 51:22

I could not have said it any better myself. I feel like self-care and making sure that your mental health is a top priority, is it should be part and parcel to growing your business. Um, and I think unfortunately that isn't always the case. And and to your point, I love what you said about when things aren't working, perhaps it's time to take a different direction. Because we even see it in the MA industry, right? You get a buyer on the hook, you start working with the buyer, you've you've invested a ton of time, money, and energy into working with a potential buyer, and something comes up. It's a red flag, it's not right, the deal isn't right. And we see sellers cling on to those buyers for dear life, even though it's not the right transaction anymore. And that cognitive dissonance is there no matter what. You talked about, you know, maybe a partner or someone who's working in the business or on the business with you is just not doing their fair share in at the time to cut ties or pivot. And same goes in the MA industry. And it can be really difficult. And I don't know if there's a universal answer to this, but to your point, protecting your time and energy uh as an entrepreneur and being honest with yourself about, you know, maybe you did invest a ton of time and energy, but going forward with this person or this deal, this buyer, you know, is this really worth worth it in the long run? And will it actually get you from point A to point B? Um, super powerful commentary on that. I really appreciate you bringing that up.

SPEAKER_01 53:04

You bet.

SPEAKER_00 53:05

Well, I want to say thank you so much, Scott, for being on this podcast. I feel like we could have talked forever about all the different there were so many subtopics we could have gone down. I was trying hard not to take us off the path of telling your story. We'll have to have another podcast in the future and um talk more about some of those softer topics that we we mentioned in passing.

SPEAKER_01 53:26

That would be great. I really appreciate your time. I appreciate your uh introducing me to your audience. It means a lot to me. And so I appreciate you know our time together.

SPEAKER_00 53:37

Likewise. Well, thank you everyone for tuning in. If you enjoyed this episode, please like, share, or comment. If you can help me remember that movie that I'm referenced earlier in the episode, that'd be great too. Maybe I'll Google it after our recording is done. Thanks so much, everyone. In the world of business, not all deals are what they see. Fortunes rise, empires crumble, all with a stroke of a pen. Mergers, acquisitions, hostile takeovers. Welcome to Mergers Cheap Road, where we examine strategies and stories behind the biggest deals. Because in MA, the real risks are the ones.