Transcript – Would You Have the Audacity to Turn Down $40MM for a $9MM Company?

Transcript – Would You Have the Audacity to Turn Down $40MM for a $9MM Company?

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John Warrillow:                Hey guys. This is John Warrillow. This episode of Built to Sell Radio is brought to you by The Value Builder Score. If you haven’t got your score yet, I’d encourage you to take 13 minutes and complete the questionnaire. You’ll find it at ValueBuilder.com. It will give you your score on the eight key drivers of company value. You’re going to learn some different things about what drives the value of your business. You’ll be able to see how you performed on these eight unique factors. Go to ValueBuilder.com.

John Warrillow:                Have you ever heard of the acronym BATNA? It stands for Best Alternative to a Negotiated Agreement. It could be one of the most powerful levers you have in the sale of your business. It essentially means I’ve got an alternative. It could be that you’ve got another buyer lined up for your business. It could be that you really don’t have to sell your company. It’s growing and it’s successful, and it’s generating cash and therefore your BATNA is going to be able to continuing to be operated independently.

John Warrillow:                That’s exactly the space that our next guest, Stephanie Breedlove found herself in. She was running a company with nine million dollars in revenue, growing 20 percent over the top line, and she got an offer of high 30s millions of dollars for her business. I don’t know about you, but it’s a lot of money.

John Warrillow:                She turned it down because she had a BATNA, which [is what continued 00:01:45] to run her company independently. She was happy to do that because it was growing and throwing off lots of cash. It gave her a really powerful position to jack up the price further. She ultimately sold the company for 55 million dollars. To tell you the negotiation tips and tricks, here’s Stephanie.

John Warrillow:                Stephanie Breedlove, welcome to Built to Sell Radio.

Stephanie:                          Hi John. It’s very nice to meet you. It’s my pleasure to share my story today.

John Warrillow:                Oh great. Okay. Let’s get into this. I learned today that you were the largest payroll company for nannies. First of all, I didn’t even know there was such a thing, that there was a payroll company that just did nanny payrolls, but that’s amazing.

Stephanie:                          Very much in this business.

John Warrillow:                Yeah, so how did you get into it?

Stephanie:                          Well, of course there’s a story behind every entrepreneurial endeavor. The company was called Breedlove & Associates. It’s now Care.com Home Pay. We actually founded in 1992, a long time ago. As you said, we convinced people that it’s worth paying legally.

Stephanie:                          Summary of how we got into it is I went into corporate America, went to work for Accenture Andersen Consulting back then, post-MBA. Took a typical career path. In 1991, my first son was born. I have two sons. They’re a little over a year apart. Wanted to have a dual career life and go back to my professional career and hired a nanny. By the way, nannies weren’t a common form of childcare yet, as the number of women returning to their careers after having children was just beginning to grow.

Stephanie:                          I was with Anderson. My husband was with Ernst & Young. We not only wanted to, but we needed to pay her professionally, and by the letter of the law. We spent about 30 hours making phone calls and research, pulling our hair out. Took a guess at what we were supposed to do and started trying to withhold taxes, pay her net correctly after calculating them, filed returns on a quarterly basis, handle an ongoing flow of almost un-understandable mail from the state and the IRS that’s very poorly written.

Stephanie:                          We just started to percolate an idea out of our own need. What if there were other families who wanted to pay legally? We weren’t the only ones in America. If someone could eliminate the pain point, would they have someone help them and take over the work?

John Warrillow:                People like ADP and Paychecks and Ceridian, they didn’t have a nanny solution you could use?

Stephanie:                          They did not have a nanny solution at the time. We went into business in 1992, and neither the large payroll processors, like ADP or Ceridian, actually moved into this space. It’s a very niche, fragmented space. The law is its own world. So, we did not have competition from the large payroll companies.

John Warrillow:                You’re not making much money per customer, because you only have one nanny. What was the business model? How did you make money and how much did you make per customer?

Stephanie:                          The business model is volume-based. You’re exactly right. We’re targeting individual families who have a caregiver, largely a nanny or an elder care provider in their home.

John Warrillow:                You might pay them 15, 20, 25 thousand dollars a year?

Stephanie:                          Yeah, the average full-time caregiver is usually what was on our system for people to feel that they should pay them legally, and take advantage of the tax breaks that come with that, and hassle with the administration. Average salary is maybe between 25 and 40 thousand a year, probably the true average being in the low 30s.

John Warrillow:                Okay.

Stephanie:                          Our service, which took care of paying the caregiver, filing and remitting all the taxes, then handling that flow of mail I was just talking about, and offering consultation to the families as well to help them with employee management, and the labor law side of things. We charged on a quarterly basis, but the average fee per year is about $1,000 a year. It’ll range between 800 and 1,000, so it’s low dollar really. It’s about $200 to $250 a quarter. It’s volume-based. Our goal, as we launched, was to begin building volume.

John Warrillow:                Let’s talk about the volume. How big did you get the thing before you wanted to sell it? What was the volume that you got to?

Stephanie:                          We were self-funded, so although we had a steady pace of growth for many years before acquisition, our growth was slower than probably would have occurred had we had outside investment. We grew at an average of about 20 percent a year over the course of about 18 years. I mean, some years of course were 60 percent, some years were 10 percent. The volume in terms of clients, our average client lifetime was about four years per client. We used to say it was from a little bit after birth to preschool. At the time of acquisition we had grown to about 10,000 active clients.

John Warrillow:                What was the revenue of the company at 10,000 clients?

Stephanie:                          At 10,000 clients we were right at around nine million in revenue.

John Warrillow:                Got it, okay. You’re nine million bucks in recurring revenue because the families are paying quarterly, right?

Stephanie:                          Right.

John Warrillow:                Okay.

Stephanie:                          They were not on a long term contract. They could come and go as they pleased.

John Warrillow:                Okay, that’s helpful for sure. You’re nine million in revenue, growing roughly 20 percent a year. I’m looking at your picture on Skype, you look like about 25, so you must have been young when you started this business? You’re probably still quite young. Am I getting that right?

Stephanie:                          You’re being very complimentary.

John Warrillow:                I don’t know, it depends on how old you are, but you look young.

Stephanie:                          I don’t mind sharing. I was actually 30 when I launched into the business, and I’m 52 now, so I’m a little older than probably some of the folks listening and have wisdom to go with that.

John Warrillow:                Got it, okay. I guess the reason I’m asking about age is, what happened for you to make you want to sell this thing? It sounded like you were just printing money. It’s a gold mine. Why sell?

Stephanie:                          Yeah, that’s a good question. We were highly profitable. I don’t think I mentioned that. This is the type of business that can be highly profitable and highly efficient. Yes, it was really at a stage where, as you said, it was somewhat printing money. So, what decided to make us sell?

Stephanie:                          My co-founder actually, by the way, is my husband. I took the leap into full-time entrepreneurship alone in the mid-90’s after we tested for a couple of years. About three years in, one founder was just not taking the business where it needed to go, so he joined me. We put all of our eggs in one basket and grew from there. So, when I talk about we, I’m talking about a husband and wife team.

Stephanie:                          We always had this long term business strategy that maybe once a year, sometimes every two years, we would kick the tires on. We called it preparing the company for next, having no idea what next may be. In our view, we wanted to have control of all the opportunities and the choices before us. We didn’t want to lose opportunity or have choices made for us because the company wasn’t ready. This has always been a critical element of smart long term planning.

Stephanie:                          Here’s an example for the acquisition. When we were smaller, we had a time when we were turning down business development relationships because we couldn’t handle some of the custom processes that they demanded because our systems were too simplistic. We were missing opportunities.

Stephanie:                          A more significant example of a next, with a positive outcome, is we’d grown beyond our technology when we got to about five million in revenue, and about seven thousand clients. A safe next was to improve our technology to handle double the client volume. But, instead we invested about two million and added an IT department to build an enterprise system that could handle up to 50 thousand clients. We thought this was the right decision for being prepared for a potential large next, whether it was large scale growth on our own partnership acquisition. Who knew?

John Warrillow:                In your mind, were you guys thinking okay, we’re going to sell this company when we get to ten million in revenue? What was the trigger, I guess, that made you go, “Okay, it’s time?”

Stephanie:                          No. One of the nexts on our list, in terms of defining next for us, was that someday we might be offered a partnership, a merger, an acquisition. We might be faced with becoming the board of directors and stepping out ourselves as we aged. Around 2010, we started to have these kinds of discussions. We weren’t actually seeking a particular type of exit, whereas we called it a particular type of next, but we began discussing, and planning and setting up criteria for if one of these nexts came along that represented an exit for us.

Stephanie:                          We wanted to be prepared for it. To be honest we’d had a couple of phone calls from companies outside our industry, outside the care industry, in the financial services industry, and in the payroll and benefits industry, just kicking the tires is what I call it. Not serious really about engaging in an acquisition, but wanted to open a discussion. We didn’t feel the timing was right.

Stephanie:                          At that time, this was probably around 2010, we decided we’d put some criteria down that if we had an acquisition opportunity, or if we decided to sell, which we had not decided to sell when the opportunity came along, we would set the criteria that we would want to see executed against that would make for a successful exit. When Care.com called, and they called unsolicited, they seemed to meet the criteria.

John Warrillow:                What was the criteria?

Stephanie:                          There’s three items on the list. Number one was, first and foremost, a strong opportunity for the company, for the company to go on and be bigger and better without its co-founders. Second was opportunity for the team. We wanted to see our team to be able to continue to grow in careers and not be replaced. Also, for us, we knew we were going to have grow their career. We wouldn’t keep them. Third, the obvious third, a financial exit that satisfied our expectations.

Stephanie:                          When Care.com called and wanted to open a dialog, those three criteria looked like they were going to be met. So, we began the dialog even thought we weren’t actively seeking an acquisition at that time.

John Warrillow:                They called you. Tell us about that. It was a phone call, was it the CEO? Was it over dinner? Give me the behind the scenes of what that approach looked like.

Stephanie:                          Here’s how it went for us. We had a low level content relationship with Care.com at the time. Obviously we’re both in the same industry, a good synergistic match, and we had been providing content to them in our space in order to allow their content to be more robust. We were in relationship with Care.com at a middle management level. It’s not like they didn’t know who we were and what we brought to the industry.

Stephanie:                          It’s like you read about in books or in the movies, the CEO, Sheila Marcelo, called out of the blue one day. I did not know her. I had not met her previously, nor had I had a conversation with her. She happened to catch me between meetings. I was piqued. I said, “Hey, I’ll take this call.” So, I took the call and for probably about six weeks we spent some time, maybe every 10 days or so, simply learning about each other in each other’s companies. The dialog was opened personally by Sheila Marcelo. We spent about a month and a half simply just getting to know each other.

John Warrillow:                Then, when did it go from nice, getting-to-know-you conversations to hey, we want to buy you?

Stephanie:                          It went pretty quickly. John, I took the lead on this. I’m not sure if they were interested in acquiring us, but as an 18 yr old company run by a husband and wife team, I think they may have been a little concerned that might have scared us off. I think they were content to continue to get to know us and let us get to know them.

Stephanie:                          Finally, after about six weeks, I remember this, I said to Sheila, “I’m really enjoying getting to know you and learning more about Care.com. It’s great to see a company emerging in the in-home care space. It’s [VC backed 00:15:40]. It’s very exciting. It’s great for the industry. But, you’re busy and I’m busy, so where is this going?”

Stephanie:                          I think she wasn’t only taken aback, I think she was pleased to hear that. I would say probably from that point to acquisition was about four months. At that moment we began having very discussions, and walking through the process step by step that is typical of an acquisition from NDAs, to sharing financial information, to traveling back and forth, meeting management teams, and due diligence, and data rooms, and so on and so forth.

John Warrillow:                Did you have any sort of representation? Did you have an [M & A 00:16:28] person, or a lawyer that you engaged with?

Stephanie:                          Yes. Here’s how we handled it, which is, I think, a little bit A-typical. We did engage an acquisition lawyer immediately. He was on our team from the outset and all the way through the end. But, we did not engage a consultant or a broker. My husband, Bill’s background is in joint ventures and mergers and acquisitions, so I had a co-founder with that experience.

Stephanie:                          With that experience in tow, we decided that the co-founders were the best people to shepherd the negotiations, rather than an outsider who may have negotiation expertise, but doesn’t know the company and it’s best wishes, as good as the co-founders do. I took the lead in the negotiations. My husband was the silent counsel behind the scenes. Then, we had a lawyer with us, so we were a team of three and that’s it the whole way.

John Warrillow:                At what point did you get a letter of intent from Sheila?

Stephanie:                          If I’m remembering timing correctly, we started talking in early March of 2012. We felt like we had gotten to a point where we could ink a letter of intent by mid-July, so about four months to letter of intent. Then, from letter of intent to finalizing the acquisition was about six weeks.

John Warrillow:                Okay. The final acquisition, I understand some of this is public, so just walk me through the key numbers on the acquisition price, if you would.

Stephanie:                          I’d be happy to. It’s public information since Care.com is now a public company. It’s in the S-1. The total consideration was 55 million. We negotiated 50 percent of that in cash and 50 percent in stock of Care.com.

John Warrillow:                Got it. Was there an earn-out at all?

Stephanie:                          Yes, there was an earn-out. Earn-outs are very typical. I would say to listeners that no seller wants an earn-out, but after coming through it I don’t believe an earn-out is something that a seller should really work hard to try to get rid of.

Stephanie:                          You have to choose your battles on where the give and take is going to be in an acquisition. If you are proud of the value that you are offering, and have confidence in what the company can do post acquisition, and you have trust in the company that is acquiring you, then an earn-out with an acceptable set of terms should be standard. We did negotiate this.

Stephanie:                          Naturally the buyer wants the earn-out, in our case, to take into account potential synergies. It was a synergistic buy. We’re very good for each other in the industry. They wanted to double the growth rate for the earn-out. Of course, we took the opposite approach. We said, “Well, we could have trouble in the transition. There could be some road bumps as the two companies come together. That could de-rail our current rate of growth.” We decided to meet in the middle and we agreed upon the historic rate of growth for the earn-out benchmark.

John Warrillow:                The historic rate of growth was 20 percent, so you had to hit a 20 percent top line revenue growth number?

Stephanie:                          Right, and we did. We had a two year earn-out, and we hit the earn-out.

John Warrillow:                The 55 million in total consideration, did that include the earn-out, or was the earn-out above and beyond that?

Stephanie:                          No, that included the earn-out.

John Warrillow:                Got it. What proportion of the deal was on the earn-out?

Stephanie:                          It was split, just like the total deal. Oh, I’m sorry, I thought you were talking about stock versus cash. I apologize. It was 20 percent, so it was 10 percent in the first year and 10 percent in the second year.

John Warrillow:                Got it. Was it cumulative, meaning if you missed the first year could you still get the second year? Or, did you have to hit the first year to get the second year?

Stephanie:                          Neither. If we didn’t hit the first year we lost the first year, but we still had the opportunity to hit the second year, independent of the first year.

John Warrillow:                Got it, okay. The 55 million total consideration, how different was the final acquisition, the final share purchase agreement from the letter of intent that you signed?

Stephanie:                          It was not different at all.

John Warrillow:                Wow, that’s great.

Stephanie:                          As a matter of fact, leading up to the letter of intent, you hit on an interesting point. As a seller, we didn’t want to go four months into a letter of intent and then have the real terms of the deal get ironed out between letter of intent and acquisition. That’s a waste of everybody’s time. We set a very realistic range that we felt we could justify, that we were confident in, and that we were also willing to walk away if we could not meet that range. We stuck to that, and that was our goal in getting to the letter of intent.

John Warrillow:                Meaning you had a number in mind that you thought it was worth?

Stephanie:                          We did. We had a range in mind. We were willing to work within that range, but we weren’t willing to compromise, and were willing to walk away. That’s the nice thing about not feeling that you want to, or need to sell. It puts you in a very nice position.

John Warrillow:                What was the range you guys thought the business was worth, that you were comfortable negotiating within.

Stephanie:                          We were an 18 year old company at the time, and a very profitable company, and a relatively mature company. We viewed our valuation in terms of EBITDA. We felt that a multiple for us would produce a total consideration of somewhere between 50 and 60 million.

John Warrillow:                Got it, got it. How did you get that benchmark? What were you looking at arrive at [even a multiple 00:23:02]?

Stephanie:                          That’s an interesting question because there are, as you know, standard methods of valuation. There are standards depending on the industry that you are in. There are comps in every industry-

John Warrillow:                Comparables.

Stephanie:                          … Yeah, that drive a logical price of a company. In our industry there really weren’t any comps because we’re in a very much of a niche industry. We did go through the exercise of having a valuation expert value the company. I would encourage anyone to do that because I think it’s an important exercise.

John Warrillow:                What did they come back at?

Stephanie:                          They came back with a multiple of seven to ten times EBITDA, given the strength of the company, given its growth rate, and that we’d had growth in every year since inception, that we were being acquired by a company that was bringing synergies to the table. We negotiated on the high end of that. I think you have to be logical.

Stephanie:                          I mean, everybody would like to say that the sweat equity that they put into a company means that it’s worth a ridiculous amount of money. Of course, every buyer would like to say that you’re worth a lot less than you think you are. At the end of the day, really the value of your company is that match of what someone will pay for it and what you’re willing to sell it for.

John Warrillow:                When I talk to people who have gone through this process before, they usually say almost inevitably that during the negotiation there were two or three times when they thought the deal was over, either they walked, or the other side walked, but they were basically done. What was the toughest part for you in the negotiation? Was there a point where you thought, ‘You know what, this is over. I’m not going through with this?’

Stephanie:                          There were two of those. You should listen to those because they could just be bumps in the road or they could be signs that you do need to walk away and another opportunity will come your way. That happened twice for us. The first time, in the very early stages of discussion, we had gotten past general discussion. We were not at letter of intent, but we had shared financials and shared details of strategies of the business. We were starting to talk price range. We were very far apart. One thing that was very different in our negotiations, and we had to come to some common terms, is that Care.com is a VC-backed company.

Stephanie:                          At the time was not profitable, and was focused 100 percent on top line, and pouring every bit of cash that they had into growth, under the VC-backed model. They viewed our value and the multiple on revenue and we viewed it on EBITDA. That made for some very difficult discussions in the very beginning. We got to a point where I felt the company was worth much more than what they were valuing for. They felt very strongly that it wasn’t. That doesn’t make either of us right or wrong, but you come to an impasse.

John Warrillow:                What did they think it was worth in the beginning?

Stephanie:                          They were in the high 30s. We were 15 to 20 million higher. That’s significant. My husband and I decided that we probably should just walk away. We actually really like the conversation and the discussions. They were great discussion. But, we were just too far apart at the time, and maybe the timing wasn’t right. Maybe in another year or two timing would be right. We closed down the negotiations. We agreed that we liked each other’s stories, but that we were too far apart, and that maybe this wasn’t the day.

Stephanie:                          About six weeks went by. I can’t tell you what occurred inside the board room at Care.com. I have no idea, but about six weeks went by. Sheila called back and she said, “You know, we have really been discussing the potential, your side of the argument, and we’d like to re-open discussions, and see if we can get closer.” I said, “Fair.” We did. So, that was number one.

Stephanie:                          Number two was in the very end. I think this is probably very common. We had gotten past letter of intent. Once you get past letter of intent and you start that process towards finalizing the agreement, it gets very technical. Lawyers get involved, teams of lawyers, and accountants.

Stephanie:                          It starts creating or taking on a persona that is a discussion, a constant discussion of the what ifs, and the worst case scenarios, and all the risk that you seemed to have put into a logical framework. But, now you’re questioning as to whether or not you were just enamored with the idea of an exit. I think sometimes there’s a little bit of panic that your buyer is not who they said they were. Maybe you weren’t really ready to sell. There is a little bit of panic that happens sometimes. You have to step back and you have to say is this a sign of something larger that I missed, or is this because this is a significant event. It has high emotion, and loss of sleep, and high stakes.

Stephanie:                          We had one of those moments. I was close enough to the CEO of Care.com at the time that I called Sheila and I said, “We need to talk through the following three or four points.” I don’t even remember what they were. I said, “Because I’m having cold feet, and I need to make sure that I’m not making a mistake.” I was that open and that transparent. We did, and I was just panicking, then we moved forward.

John Warrillow:                As you look back on the three or four [deal 00:29:43] points now, where they material? Where they trivial and you were literally having cold feet?

Stephanie:                          They were trivial. To be fair though, I really needed to gain a confidence level that they were trivial. I remember one of them being around the earn-out, and the negotiation on the earn-out. I remember the second one being the motivation around a board seat. We did not obtain a board seat of which we desired. That was one of our gives, if you will. In the end, I’m actually glad that I didn’t take a board seat. I think there would have been too much of a conflict of interest and also I’m a very different breed than a board full of venture capitalists.

John Warrillow:                How has the share for Care.com progressed since 2012?

Stephanie:                          It went out in the IPO at 17, and it has fallen. It currently hovers around 10. But, the care industry is a long play. I know, I’ve been in it for over 20 years. The march to profitability has made a big difference for Care.com. In the past six months they’ve turned a profit and they’re on their way to a profitable structure. I think they’re doing well. Are they doing as well as they wanted to at the outset with the IPO in 2014? No, but they’re a solid company and the care industry is a long play. They’re a leader in the industry. I think they’re going to do well.

John Warrillow:                I think a lot of people listening would really value the tips and tricks that you have related to taking stock in the acquire in the form of compensation. You took half of your deal was in stock of Care. Walk us through the limitations that you had. I’m assuming you couldn’t just go around and sell it on the public markets. Maybe you could just talk about what restrictions you had around those shares.

Stephanie:                          I think I would say first of all that anyone who’s looking at selling a company in which there is stock in the consideration, you have to be very, very comfortable with the risk that that presents because it’s often a long term play. Stock has risk and we knew that going in. Naturally, we would love to have sold to Care.com for 100 percent cash and they would have loved to have purchased us for 100 percent stock.

Stephanie:                          We compromised in the middle. I think it was an appropriate compromise given that they were only a seven year old company. They were marching towards an IPO. It was an appropriate structure for a company of their structure. But, once we inked the deal, we stayed for an additional almost two and a half years to ensure the transition went smoothly and to participate with a larger company within the IPO. When you’re an employee of the larger company, you have restrictions. You can’t sell. You can only sell your stock during the open windows for employees.

Stephanie:                          For a significant period of time, we could only sell along with employees. As executives of the company, when a company goes public every deal is a little bit different, but executives are locked up for whatever the company negotiates with them. It’s typically anywhere from six months to a year. So, you’d love for the IPO to have a pop and sell your stock, and ride off into the sunset. But, it doesn’t work that way.

Stephanie:                          We’ve now exited the company. I’ve been out for a year and a half now. We’re selling them on the open market at will, whenever we want to.

John Warrillow:                Got it, got it. That’s super helpful. Talk about the emotional impact. Here you are, you’re husband and wife, you’ve just gotten this colossal check. How did that manifest itself in your life after selling?

Stephanie:                          That is a loaded question. I did know that in the exit that I’m not the kind of person, nor is my husband, who can just travel, and play golf, and act retired. Our sons are grown. They’re 24 and 25, and both out of college, living on their own, so we’re empty nesters. That has been true. I’m not that person. We are struggling to build these kinds of pleasures into our life. Actually when we exited, we took a year to rest and rejuvenate. There were many days during that year when I found myself saying, “I’m working really hard at not working.” That has been an interesting journey.

Stephanie:                          But, I actually thought when I exited that I’d begin this new phase of philanthropy in my local community. I’ve always been very actively involved, whether it be industry boards or school fundraising, etc. that’s not where I am right now. This isn’t where I’m giving back. I’m actually focused at giving back in entrepreneurship where my talents have been. I couldn’t be happier with my choice right now.

John Warrillow:                Tell me what that looks like. I understand you’ve got a book coming out? How are you giving back through entrepreneurship?

Stephanie:                          I do. What I’m doing right now is I’ve become an active angel investor. Those of us who’ve been entrepreneurs, I think we make very, very good angel investors. I am also a mentor once a week for free. I’m doing mentoring for entrepreneurs.

Stephanie:                          You’re exactly right, after I left the business I realized that although my story as a woman in entrepreneurship isn’t really extraordinary, I realized that it’s not very typical. There are less than 10,000 women who own businesses, or have equity positions in businesses with over 15 million in revenue. One of the top three reasons that they don’t start [or scale 00:36:34] a business is a lack of a role model. Those of us who’ve been there and done it are like looking for a needle in a haystack. Through some encouragement from friends and family and business associates I decided to write a book to be of value to those behind me. It’s called All In. The subtitle is How Women Entrepreneurs Can Think Bigger, Build Sustainable Businesses, and Change the World. It comes out February 7th. The intention is to help women, in particular, find the answer to that calling if they think they want to be entrepreneurs, and to not just start businesses, but build businesses of scale.

John Warrillow:                Right because the stats show women are starting businesses at a much higher rate, but they often don’t necessarily scale at the same rate. That’s an interesting conundrum. You’re trying to crack that nut with this book. Is that right?

Stephanie:                          That’s exactly right, that’s exactly right.

John Warrillow:                Hey, I wish you all the success in the world with that. All In, February. I’m assuming it’s going to be available through wherever books are sold, Amazon, and so forth?

Stephanie:                          Yes. Amazon, Barnes and Noble. It’s available for pre-order now. A shameless promotion there.

John Warrillow:                Yeah, no, no, go for it. We’re all entrepreneurs here. We can handle a little self promotion. Let me ask you one question. It relates to your kids. Two boys, you said, 24 and 25?

Stephanie:                          Yes.

John Warrillow:                What are you doing with them? Mom’s got a check for 55 million bucks. It’s all over the news. If they want to Google it, they can find it. I’m sure they have. How do you talk to them about oh my gosh, this is a lot of money? Are you having those conversations with them?

Stephanie:                          Yes. It’s an evolution. We self-funded this business and they were toddlers when we started. So, they have watched us go from bootstrap entrepreneurs with simple outings and clothes from Walmart in the early days, to a 55 million dollar check, and the journey from A to Z. To be honest, they are both a little uncomfortable with the size of the exit and what it represents. Mostly because they were with us on the journey and we’ve raised them to be humble, hard-working young men.

Stephanie:                          But, they’re also only 24 and 25, and wrapping their arms and their brains around what that means for their family, and for their future is a lot to think about right now. We take it one step at a time. We actually talk about it as a family. We’re not the kind of people who are going to say, “Okay, Davis and Austin,” those are their names. “I’m going to throw a lot of money at you right now and hope you handle it well.” We’re navigating it together as a family. Our priority as parents is to help them find their passions and their talents, and money doesn’t always do that.

John Warrillow:                Well said. The book is called All In. It comes out in February. Stephanie Breedlove, thanks so much for joining us.

Stephanie:                          Thank you, my pleasure.