Ep 357 How Mike Winnet Sold His E-learning Company for Around 4-Times Revenue

(upbeat music) And we only charge 40 pounds, they're like $50. And we couldn't sell this product for $50. As soon as I repackaged it and put a 10,000 pound a year price tag on it, I managed to sell 340 of them. So it's exactly the same product, exactly the same principle, but I learned a lot of business lessons in that first three months when I couldn't sell this to anybody. Which was target management, target budget holders, 'cause it's not their money. A job seeker spending $40 or $50 is a big decision for them. A budget holder selling, spending 10,000 pounds to educate their entire workforce. It's a very easy sell, the value's different. Hi there and welcome back to another edition of Built to Sell Radio, the podcast designed to help you punch above your weight in a negotiation to sell your company. I'm the executive producer, Colin Morgan. And today on the show, John is joined by Mike Winnett, who sold his company Learning Heroes for around four times revenue. But before we get there, in today's interview Mike mentioned the power of his YouTube channel for building his company on a shoe string. And so I did some digging and found an awesome video. I'm really thinking you're going to enjoy on how to become a best selling author. And I've linked to that video over in the show notes section which can be found at BuiltToSell.com. Okay, so now let me tell you about today's guest, Mike Winnett, who started Learning Heroes, which delivered eLearning courses to large corporations. The business struggled out of the gates, but after making one bold decision, the business flourished, resulting in Mike selling his company two and a half years after launching it for roughly four times revenue. Here to share with John, the full story is Mike Winnett. Enjoy. (upbeat music) Mike Winnett, what can BuiltToSell radio? Thanks for having me, how are you good? I'm good, man. I want to hear about Learning Heroes. How did you come up with the idea for this business? Well, I stupidly decided to set up a business in an industry that had no experience in, no knowledge of. I just basically quit my job 29 years old with 12,000 pounds. I don't know, maybe like 15,000. To be fair, it's probably about 12,000 dollars now the way the pounds tank grew. It's changing every minute. Yeah, so about 12,000 dollars in my pocket. I was 29 years old and I just came up with the idea for Learning Heroes in six weeks. So I knew nothing about the industry at all. All I did was I went online. I searched for what jobs were recruiting at the time. And I noticed that about 90% of all job ads would ask for effective time management skills, effective communication skills, teamwork and ability. And in the UK, you don't get qualifications for those courses or skills. But I just thought, I've got GCSEs and A levels and I've been through college and stuff like that. But how can I prove that I've got these other skills? I went online and found e-learning courses offering to teach these things. And it just didn't really compute with me. I thought, if I want to learn something in real life, I would go on YouTube and I would find a video to teach me in three, four, five minutes. So it could be how to cook the perfect Sunday Roast or how to whatever build a wall. I'd always go on YouTube and I'd follow along and watch a video. So it made me wonder why on earth do we learn completely differently when it comes to employment. And that's when the penny dropped. I thought, why don't I just create content that's more akin to how he would learn at home and then apply that to the corporate world. And I came up with the idea. I wrote 10 million pounds on a piece of paper and a date and my plan was to then create this business and sell it for 10 million pounds, which was $11.1 million. On the first of January 2018, that was what I wrote down. And I executed that. Yeah, and I executed that and I sold it for about 8 million pounds, which was $11.1 million. So in fact, I don't know what it would have been in dollars. But it was 10 million pounds wrote down and sold about 8 million in two and a half years. That was through no passion of the industry. Now we're interested in it particularly. Literally just the industry suited on model but I thought I could create a successful business and it was my first ever startup that I did this is amazing. So let's get into the business models. So you identify that things like communication skills and negotiation skills are important skills across a variety of industries and jobs. What did you then do to create these courses or this e-learning? So I was quite cleverly. I looked at this industry particularly and I looked at the problem with most businesses that I think people set up is they think that their USP is them or they're slightly cheaper than their competitors where I really like to look at an industry where you can create a genuine alternative to what's out there. So the reason why Uber does so well is because the way that they've got a completely different model to how traditionally you would book attacks that you would hail a cab, whatever it might be. So I looked at e-learning and I looked at everything that was wrong with that industry. Number one, the content was too long. It was boring. It was basically created by geeks, not people that had been in business or had had to train or develop stuff. It was long contracts. It was expensive for what it was. People would price per head, per course. And I don't think it was fit for purpose. And then the people in the industry also tried to make out like online learning and e-learning was the be all and end all of training. When the reality isn't it's such a small part of your learning journey. And I think actually, even though I sold the stuff, quite an insignificant part, I would think it's better for pre-learning. So it's good for introducing concepts and languages and then the real learning takes place either through experience, shadowing people on the shop floor, wherever it might be on the factory floor. So I basically thought how can I create an actual alternative to what's out there? And that's what we did. So we went and we had a canceling time rolling contract, which nobody else did at the time. It was new content every week, rather than trying to sell big expensive catalogs that most people wouldn't use. It was not price per head, it was not price per course, per course. So that's kind of what we did and we created a genuine alternative to what was out there. And then the way we marketed it was very different. So we would market it in a way where we actually took shots at our industry, where we would say e-learning's crap and we know because we make it for a living. And that really caught the attention because it's not often that people would talk like that about the industry that they are in and that's kind of how we managed to a get a lot of attention with no marketing budget. And B, because we genuinely had a real alternative, it meant that even if our clients used another provider for their content, we were a low cost option that they could bolt on. So we didn't have to wait two years, three years, four years for those existing contracts to run out. They could try us for a few months, see that our content was better and then they would keep us in place while that other contract ended and then they'd go exclusively with us. But we were so low cost that we signed up lots and lots and lots of clients very early on. But the smart move came where our content would be used on anybody's learning management system which is the platform that big companies use to track what learners have registered, what courses have done, pass and fail rates. So instead of trying to create an expensive system like most back competitors, we just created content that worked on everybody's system which then meant my plan was to sell in three years. I could proactively aggressively target some companies and I could go in peace and try and partner other companies to work together. And I knew that one of those two strategies would result in me getting a sale at the end of three years. So that's kind of what I did. But to go back to the question on courses, I think a lot of people when they start their own business, we could have created a library of 300 courses and then tried to sell it and find out that no one would buy it. I launched that business with four courses. That was it and it was a list of titles that I might or might not have built. And I could, I started to sell that before. So then the reason why we used to release new content every week, the real reason was we didn't have any content. We were making it as we went. So every Friday, we would release a new course. We didn't have the courses when we were selling it. - How did you create the courses? - Well, it's just go on there, do some research and just quickly write the courses. It wasn't difficult. As we went on. - You're not an expert on negotiating. What were the four courses? - I'm curious because some people would look at this and say, okay, well, we're gonna do a course on X. - Yeah, but this is the thing. These courses weren't accredited courses. These weren't two hours long, three hours long because these were all the things that were wrong with learning. These were, we basically used to break a course down into three sections. And I'm talking, of course, might be only five minutes long, six minutes long. It was essentially, "What is a tried and trusted everybody should know this fact about time management?" What's the sort of theory that everybody's known since the beginning of time that we know works, then one was what was a counter-intuitive thing that had just come around, and then what was sort of topical or trending. It might be something new that you've never heard of before. And we used to build the courses on those three principles, because we then knew it was something for every learner. Here you go. Here's something that's tried and tested. You must know this thing. And it could be how to upsell it until in retail. And it could be if someone buys a pair of trousers, you might say, "Hey, if you've seen our belts, we've got a great offer on leather belts." So that's suggested another product might be a tried and tested thing. Then there might be something that was counter-intuitive, so it could be something in retail that might go against the grain, but you know, try it, it might work. And that's all it was. So we literally launched with teamwork and ability, effective communication. We had a leadership course in the other one. It might be cyber security awareness, and it's just like, you know, don't plug a USB, an external USB in it, it works. So really basic stuff. The funny thing is actually, I first tried to sell this product to job seekers. And the idea was to help them gain skills so they'd be able to perform better at interview. And they might get the job that they were looking for. And we only charge 40 pounds, so like 50 dollars. And we couldn't sell this product for 50 dollars. So it was exactly the same product, exactly the same principle, but I learned a lot of business lessons in that first three months when I couldn't sell this to anybody, which was target management, target budget holders, 'cause it's not their money. A job seekers spending $40 or $50 is a big decision for them. A budget holder spending 10,000 pounds to educate their entire workforce. It's a very easy sell, the value is different. So that was one of the biggest mistakes and lessons I learned in that first sort of three to four months. And one of the things that you did very differently than in your earlier comments that I'd love to explore deeper was not choosing to sell per seat. Yeah, and the stupid concept, I think. Yeah, but it certainly would be differentiating versus everybody else who would sell per head. It's greedy. But I used to market it like that. I used to say, I don't get it. How come you're so different? I think you've got it wrong. And I used to say, no, the industry's got it wrong. Why should I punish you? If you're a client of mine, you've got 500 staff. And then your business does well and grows to 600 stuff. Why should I punish you for that growth? If anything, I'm just glad to be a part of it, right? You know, our trainings helped you with business grow and you've made more money. It's content. It doesn't cost me any extra money. My end, if you've got 10,000 staff or 100 staff, it's already made. It's pretty much 99% profit at this point. But I was very transparent with this. And that was the kind of content and commentary. I was putting out there about the industry. That's why it wasn't well liked by a lot of our competitors. The ironic thing about it is most of those competitors that didn't like that now have adopted the pricing model that I had and we launched. Because we basically took all their clients off of them. How did that pricing model? How was it viewed by your acquirer when you were negotiating the sale of the company? They loved it. They loved it. I mean, they increased the price by 40% the moment they walked through the door. They lost like the bottom 15, 20% of their clients. But that business has been sold again for a billion dollars like two weeks ago. They basically went in. They crossed sold their existing because they were a platform provider. So they had a big expensive $100,000 a year platform, learning platform. So to them, they could just bolt on our contents or the existing clients, make their money back that way, and then they could also sell their learning management system to our existing clients. The cross sell opportunities were huge for them. So they wanted recurring revenue, subscription based, high profit pricing. So they lapped up. That's what they were looking for. And that's what they were requiring at the time they bought our business. Because you know, we only lost one client in three years. Only one client can so their contract in the entire three years that we had that business. One, so we had like 99.3% potential rate. And that's not a lie to sound impressive. It was it was one of the easiest biggest no brainers. And what often used to happen? So we would sell to a learning development manager in a business. They would then move to another business. And then they would bring us in straight away. So there was some learning development managers that had actually bought our products at three or four of different jobs in the two and a half years that we had that business. Who is the we? Who were the partners in the company? So there was myself, Ian Darlington, who is my business partner and stuff that we do now. We've got a production company called Iron Production. So we do content marketing and marketing and sales community called Views of My Own. So it was myself and Ian. And then there was two brothers Adam and Aaron Cara. There was the four of us and we split the company. Did you guys just split it equally in four parts? Yeah, got it. And so did you all have to kick in some cash in the startup years or did you just agree to not take money out? Or how did you go finance it? You know, you eat what you kill, right? Makes you more your work harder. So we didn't we didn't put any money in. It was if this doesn't work. I left 12 grand 12,000 and my bills were 2000 a month. So I knew I could work for six months. At something and give it a real good push. So it was completely bootstrapped. We had no investors. We just literally head down and worked, worked, worked. So we didn't even start taking decent money until 18 months in. Any two years in. So yeah, it was it was all about the sale. We were so focused on the sale. That's where we need the big payoff would happen. A lot of people when you think about sales and thinking in particular of selling the product now. A lot of people would raise money in order to finance at buying advertising and so forth. How did you win new customers for your offering? Content marketing. I was the only salesperson at business. So maybe five six months before we sold. So the only thing I did was I would write content. People would see my content and get in touch because they were interested. I write content on LinkedIn. And then I always think for a lot of startups, most founders say, I just wish I could have another one of me in the business. The easiest way to do that is just create video content answering the questions your idol client asks. As soon as you start doing that, you're multiplying how many of you there is in the business. So if you ask, if I do 100 sales calls in a month and I get asked the same 15 20 questions, what I did was I made videos answering those 15 or 20 questions then I just put those videos in the places that people ask questions, right? Google, YouTube, LinkedIn. As soon as I put that content there and people search and find those videos, they're self-qualifying leads, right? You don't need money to do this. You don't need to spend money on ad campaigns, Facebook campaigns. I think those kind of campaigns aren't as effective at converting. So they're good for brand awareness or getting in front of lots of eyes and impressions. But impressions isn't a metric I place any value on. I think it's a nonsense metric. But what I would do is if I can create a video that might be free ways to increase your online learning attention or three ways to get more employees to want to get trained at whatever it might be or question based. So what question might an idol client search for? As soon as you make content like that, anyone search that question self-qualifying and then you give them some value, a like you trust you, they've heard your voice, they've seen your face, then when it comes to purchasing, then nine times out of 10 going to come to you because you've already helped them. Yet you've never heard from them before. Now if you make videos that overcome objections, they've already overcome numerous objections before you ever speak. So the way to how to close those people when they finally do speech is so easy. So how did I get so many clients? Number one, I'm relentless. And number two, I knew I couldn't be in 20 different places at the same time. But if I made 20 different videos answering 20 different questions, that all my ideal clients would ask, I essentially was in 20 places at the same time. So that's what I did. I also used LinkedIn really well. So I knew that any business that had a certain job title in it took learning development very seriously. So then I also looked at the size of the business. So I know if anybody had more than 500 staff in their business, they could easily afford $500 a month. So if they had 500 staff plus a learning development manager, I knew there was a good chance that I could sell to that company. And that's what I did. The very first thing I did though was make a list of the top 200 most affluent companies in the UK and targeted them. Now why I always do this is so many people in the start of business try and start small. They try and get a few clients in and they don't think they can handle a big account. But for me, I don't know what their buying processes. I don't know how long they're buying circles at cyclists. So I didn't know where they're going. for it might take me two years to get into Barclay's bank or Virgin or any of these big what's your 100 companies. So you've got to start that process. Now there's no point working two years till you think you're ready, then finding out it's another two years decision-making process for them, right? So I targeted the biggest companies that we were probably not ready for right from day one. And this is a little thing that I did. I quite like guerrilla marketing campaigns and unusual marketing campaigns. I took a lot about this in Vamo, my sales and marketing community. I made a box for the top 50 most affluent companies in the UK and in it was a screen that played an animation, an animation that looked and felt like our e-learning modules with a personalized message or the person that opened it. I sent 50 of those out and it cost 60 pounds per unit. And of those 50 that went out, I signed up 26 of the companies that received them. Because none of them had ever seen anything like this before. But I tell you what, you can send an email because it's easy, you can DM on social media, it's easy. They're getting hundreds of them, cold calls, they're getting hundreds of them. If you've got a box that arrive you at work, you're going to open it. They open it and then it plays a personalized message to you saying, hey, we'd like to talk to you about this. And depending on what company it was, so if it was Virgin, it was an animation of Richard Branson with a voiceover that sounded like Richard Branson telling him to get in such a fuss. People don't ignore that stuff. So 26 out of 50 people that got that box, that is sent out in the first couple of weeks that business once I decided to target corporates, signed up with that business. Amazing. How big did you get this company before you decided to sell it? 24. There was 24 office at the time when we sold. I tell you what, I didn't like it at that stage. I like a very small less than 10 others against the world, celebrate every small win. At the end, it's boring. We were signing up 20, 30, 40,000 pounds with a business every week, but it doesn't feel the same to me. I like the, when you get a 350 pound client or a 500 client, when you've not got any money, you're not paying yourself, I like that was against the world's start up. Can we do this? We've got no budget. No one knows who we are. Can I get into this client? That's more interesting to me. So I didn't like it at the end. As soon as you start getting HR, and soon as you start actually monitoring annual leave, and people start talking about, can I have holidays and stuff like that? I lose interest to be honest. It starts getting a bit too serious for me. So you were 24 staff roughly would turn over. Well, we had 340 clients paying us on average 412 pounds a month. That's what we were turning over. Our actual profit wasn't that high, really, about 400,000. You're going to make me do the math on this aren't you? 340 times 412, 3 times 412. So like 1.2 million pounds, is that be right? What's that? Yeah, roughly. Yeah, okay. Got our profit was like 400, okay. Right, okay. And did you have any sense of what the business might be worth? No, the goal was to sell it for 10 million, right? So it was just to sell it some for 10 million. That was it. I mean, I went to my, my accountant said it was worth 1.2 million. What was your reaction to that? Yeah, I think you were wrong. I said it was sell for closer to 10 million. So six months before we sold, we said we want to sell this business in the next 12 months for 10 million. And they, they said they laughed at me. They said that you're living in dream and this business isn't that it's three times your profit, 1.2 million. And I said, you're wrong. You don't understand how this works. You don't understand why someone would buy us the reason sell buyers and why it's a lot more than that. And we agreed to disagree. And then I went and sold it for 8 million. I want to get to that and just, I just did the calculation, my little calculator. So I was ranked roughly $140,000 a month of MRR, which if you annualize it would be about just under 2 million pounds of ARR annual recurring rate. Yeah, that's not about right. Yeah. But I actually, that turn of was high. It was at this point, it was expensive in an expensive office. We would take in a decent wage as well at the time. At the end, we would take a decent wage. It was a, yeah, that's what I look for now. If ever I have a business, it's can it be monthly recurring revenue, can it be content-based, subscription-based? Does it tick those boxes? Because the spoke stuff's bullshit, if you want my opinion, you know, building individual things for individual people. It's too much like hard work. Yeah, yeah, for sure. So bought part a couple of million in top line, 400,000 bottom line, your account says, oh, it's worth three times. So it's 400 times three is 1.2 and you're like, nope. What gave you the confidence that it was a 10 million dollar business when even when you're accountant professional in this area is saying, that's probably close sort of. Yeah, because I don't think they had ever dealt with a business like ours before, right? I don't think they realized that it was across cell opportunities there. So someone might buy my business that sells a learning management system. They're learning management systems worth $50,000 or $100,000. The opportunity to sell a $100,000 product to $340, fully engage, fully on board customers is huge. So potentially they're looking at what can we actually add to this business and then flip that. If they've got, say, and this was the company in the borders, they have 3,600 clients that owns their learning management system. It's easy to bolt on a 10,000 product to their existing offering. So there was the cross cell opportunity the other way as well. So I knew the cross cell opportunity would be huge. That would that would add a few multiples. I also knew competitive tension. Now, when we launched in America and we launched in Australia, already there were learning management system provided saying, can we have exclusivity in this country? Now the answer is no. I wanted to partner everybody. If you want exclusivity by us, if you don't want your biggest competitors to be able to offer the same product by us, so I knew that would also create tension. And that is actually how we sold and that was the reason someone bought us. They didn't want their biggest competitors to have in our content in America. So they ended up buying us just to stop their competitors again. And these are things that accounts that still look at, right? Because to them, they're just looking at numbers on a spreadsheet. So that was one of my biggest things for anyone selling their businesses. Try and find an accountant that's aware of your niche or your sector or has done business in that sector because it's so important. Because we would have took advice of some, but I thought was an expert. It's never actually been through that process in your niche before or dealing with the products quite like yours. And if we'd listen to our account, we might have accepted a lower offer. We're offered $7 million at first and then we turn that down. And then they came back with $8 million and zero workout. So they said, would give you the money in 32 days in full. And you don't have to come into the office again. But that's why we took the offer at that point, two and a half years after we launched. Incredible. I want to get into the actual specifics of that deal. So you're roughly a couple million pound turnover annually on the top line. And you're expanding to Australian and the United States and having conversations with learning management system providers. We have 26 partners at this point. We have 26 learning management providers at once. It's a partner for our content. Because our content was the best around I thought at that time. And they are asking you for exclusivity. Yes. Some of them, and your stock answer to that is, hey, you want exclusivity just by the company. Exactly. Were you serious at that point that you would be open to selling a company or was that more of a joke? No. I decided on the first day of my business, what day I was going to sell it for. When there was a conscious decision to start having these conversations 12 months before that date, I was going to sell. So I backwards planned the business from that point. So I realized that this point, I need to be having these types of conversations with these types of people and identified who might be able to buy the business, why they would want to buy the business, how do I get on their radar early, then I'd go further back into the timeline. So how many clients would I need at this point, what price would they need to be paying, then even further back. So that means how many clients would I need to be selling too quarterly, monthly, weekly, daily. So I'd work this all the way back to the day I was sat there with a piece of paper that just said 10 million pounds first of the first 2018. You mentioned you had 27 partners before you started this conversation. How did you contemplate or how did you structure your ability to cancel those partnerships in the event of an acquisition? Did you, did you have that right in the event of a transition of ownership? No, like it was something we didn't discuss. It was just that you and a partner as they put multiple, all these elements providers got multiple content partners, right? Now their clients could come to us direct and cut them out of the loop. So say your, I've just picked a random one, so Cochem is a learning management system. So Cochem's clients could come to us and buy our content off the shelf and upload it into their their system themselves. or it goes to the account manager at Koko and say, just bought this new content, can you upload it so our learners can use it? So our point was, don't partner us and we'll just sell to your customer base anyways. So most of them wanted to partner us 'cause then they're thinking, oh, we can get 50% just by partnering you and proactively promoting you to our existing client base anyway. So A, we offered them more than any of the partnership that was out there. Most partnerships would be 10% to 50% on the revenue. We offered 50% because all we were doing is the land grab because we knew we were gonna sell, right? So we offered more. So then we knew that when it comes to selling a learning management system plus content package, these providers and their sales team would be more inclined to push our content because it was more money in it for them. That was why. But yeah, no, we had paperwork that says that at any point we could decide to cancel the partnership or whatever. But yeah, we didn't enforce that with anybody. 'Cause at the time-- I had it right to, is it, I guess, what I'm getting? Yeah. Yeah, because it didn't actually affect their clients. Their clients would have had our product anyway and it's in their system. So that's all. And they didn't get commission on the recurring revenue. A lot of them got, we also had an annual option which most of them push 'cause when you're buying a big learning management system for 20, 30, 40,000, it's easy to bolt a 5,000 or 10,000 product on it. The most of them were, they had them on your front and even that, they're not that 50%. Yeah. So you had this conversation with a potential choir. Was this the actual choir of the business litmus? Was that the name of the company that originally you said, "Look, if you want to have exclusivity, then just buy it." Yeah. Yeah. Okay. And litmus came to you and said, "Great, how's 7 million sound?" Yeah. And your reaction was, doesn't sound anything like 10 million. That was it. That was the be all and end all of the conversation. I actually said to them, "If you had a house up for sale for 1 million pounds and I offered you 700,000, how would you feel about that offer?" And then they said, "Well, probably wouldn't be happy." And I said, "Well, why do you think this is any different?" And I think they thought I was joking or as if I was weird for not being excited or jumping through hoops or dead giddy. But no. The money's irrelevant at this point, you know? I think so. Because if they're offering 7 million pounds, they know there's a deal in it for them, right? If someone jumps at you and offers you 7 million quid, they know it's worth a lot more to them. So they're taking the piss really, aren't they? They've got to be. Imagine not knowing who you were still a couple of months ago, then they go, "Do you know what? We've given you 7 million pounds for your business." What they're thinking is, we could probably flip this business for 20 million, 25 million. Let's just try and give these idiots a, don't know what they're doing, a low-ball offer and see if they take it because they're working class. They've not got a clue what they're sat on. They don't know the potential. We could take this business. And that's kind of the mindset I had. I said to the other lads, don't talk. When it comes to money, none of you speak, leave it with me and I will handle the money side. And yes, the 7 million offer came in and I said, "No, thank you." Went home that night and told my wife and said, "Oh, we've got offered 7 million for the business today." But anyway, we're like two and a half years in. And she said, "Oh my God, we've made it rich." Millionaires said, "Oh, no, I said no." It was like, "What?" And then they came back Monday saying, "Right, 8 million, but these are the terms." We don't want to see you again. You're not allowed to work in this industry for two years. Get your cash up front, piss off and be quiet. And I said, "Yes, thank you, I will sign." And that was that? - That was the reaction among your partners to the revised offer. - Yeah, let's take it. It was not doing a workout was so important with, because what you need to remember, none of us had a passion for this industry. None of us wanted to be known as the e-learning boys or be the main face of, it was just a means to an end. It was just a way to acquire enough money and wealth to be able to do some of the things that we were interested in. Investing in properties, investing in businesses. And also, we knew there was a shelf life on this industry. We knew that if we could do this with no money, no investors, a lot of these businesses that were willing to pay 7, 8, 9, 10 million for us could easily bypass us in half the time if they threw that money at their own existing team. So it was a calculated risk. And it was calculated when we would sell that business. That's why we knew we probably had a three-year shelf life on that business. You can be the best in the industry for two, three years. Then you get bypassed by, you know, and this is how I looked at it. They had 8 million pounds there to spend. It could have probably spent two million in quarters in six months. So it was just the right time to sell, in my opinion. And this is on the basis that that company has been sold twice now since then. And the last sale was for $1 billion. So we would never have got that business to that size ever. What was it about the goal of $10 million that was so important to you personally? What is-- what did that represent to you? Nothing. I think whenever you ask anybody what they want to sell the business for, they normally come back with one of four answers. It's normally $1 million, $3 million, $5 million, or $10 million. I don't know why I did $5, and I don't know why I did $4. So I don't know why it was just the top number. $10 million seemed like a nice round number. It was four of us. $2.5 million each for two years' work, $3 years' work. It didn't go all right. So that was it. I mean, I wish now I'd wrote $20 million on the piece of paper. I didn't-- the irony being, I'll say this. Made a little thing about it all. So the main thing about all that stuff is I wrote down exactly the number of sales that I needed to get for each year, year one, year two, year three, year one was 80. And I finished year exactly on 80 sales. Year two was 200, and I ended the year exactly on 200 sales. And year three was 400, and we were on 30 at this point. But it kind of blows my mind that I don't believe in the law of attraction and manifestation of any of these things. I think the law of action actually having a clear plan and sticking to it, and then not being distracted by shiny objects syndrome that a lot of business owners are not going to have sticking to the plan. It was key to us hitting those numbers. But when we were saying the first year, we weren't paying ourselves about nine months in. I think we might be paying ourselves $500 a month, less than what makes expenses for the time. And Google came along because they'd seen some of our content, and they wanted us to create them some bespoke content, and offered us $90,000 to do it. And it was a three-month project. And we said no. We said no to Google at $90,000. Even though we weren't paying ourselves properly, because it didn't fit the plan. And it would have derailed us and put us back three months. So we made those types of decisions, knowing full well, that in three years time, we would get 10 million for the business. That was, we were that sure of the plan. And we were that confident that we stood for the plan. Even when money would probably distract a lot of the people in business. I know loads of people would have took that Instagram contract, whereas it didn't fit the model. And we used to have a sign on the wall that said, does it make the boat go faster? And if the decision didn't make the boat go faster, we didn't do it. And it was that simple. It's an amazing story. And you know, I'll tell you this. I find business interesting. Because there's lots of people out there that will take money off you to tell you what you want to hear. There's a lot of people that would pay a lot of money to learn some secret hack or secret way of circumnavigating or avoiding hard work. But because most people, probably over 90% of people, want to avoid the hard work and actually putting the effort in and doing what they know they need to do, it actually makes it very easy. So it's hard work, but it's very easy because most people don't want to do the hard work. And that's why if you just pick an industry where you can create a real alternative, you can genuinely be disruptive. You've got some genuine USBs, not blind me, or with 5% cheaper than a competitor competition. If you can genuinely create an alternative that makes people think, oh, go on then, I want to know more about that thing. Or I think Elon is crap, or the way that you book travels crap, or the way that you book hotels is crap, whatever it might be, let me know about this other thing. It's actually quite easy to start up a business, grow it, scale it, and essentially, if you've got the right model and you know who might buy you and you've got on their way down and stuff like that, it's quite easy to almost sell a business or get in front of anybody. But most people kind of want to circumnavigate all that stuff. They want to find, you know, how can I make six figures in 90 days? How can I generate a hundred new leads into my business within 30 days and stuff like that? Well, we didn't do any of that stuff. We just worked really hard, long days, many days a week, but not for very long. long and we still managed to blast past most of the people. What was the kind of sand paper on your relationship with your partners? Like, what, I mean, it sounds like a great relationship overall, but what, and what did you disagree? Lots of things, one is essentially. I would never start a business now with four people, or four of us, or decision-making. Because essentially, there's always one that you feel like isn't putting the same effort into everybody else, or they might have different spending happens to everyone else, or they might, so four is too many. I'd say three is too many. The most people I would start a business with now is one person, and that's what I've done in all my business assistants. And it's the same person incidentally. But yeah, so the relationship was stressed, strained, as they'd say, and to be fair, if we didn't sell that year, I think it probably would have been loaded or someone would have killed someone. And that was not a joke, by the way, legitimately. The number of times where we'd have arguments, and I was the worst one, all that, by the way. I clashed with one of the directors. The other two were quite diplomatic, where I wasn't. I think that me or the other director probably would have killed the other one of it. So yeah, so it came at just the right time, to be honest. That was part of the reason why we sold six months early, as well as the terms being favorable to work out, cash upfront, you know, a lot of things, because the way the company was set up, so if you wanted to take 20 grand out of the business, $20,000, we all had to take 20,000 pounds out of the business. So it was never $20,000 decision. It was a $80,000 decision. And when you're building a business to sell, taking 80,000 pounds out, $80,000 out of a business might have a big impact on how much that business is worth, especially when those decisions you're making due to your personal spending habits or stuff like that. So that was the biggest thing. You want to try and partner somebody with the same kind of living standards as you as weird as that sounds. These are things that a lot of people don't look at when they're thinking of having a business partner. Same kind of values in terms of, you know, how you are outside of work. Are you a family person? Are you flashy? You know, I still live in the same three bedroom, semi-detached house. At the end of this business journey that I did at the beginning, I still drove the same car, which was a Ford Focus. I don't know if you have them over there, but I had a Ford Focus on a 13 plates for 2013 Ford Focus after I sold my business. I still drove that car for 13 months, because it never was about looking successful. I was all about being successful and I wasn't asked if anybody knew or not. I didn't have any social media, by the way. I didn't have any Facebook. I didn't have any Instagram. I didn't have any of this stuff. I just had a LinkedIn account and a YouTube channel. It wasn't even my face. That was the only two things I had. I had zero interest in trying to look successful at the expense of time, effort, and being actually successful. I'd rather be rich and successful than no one knew who the fuck I was over. I want to be online on social media, renting lambo's, trying to look successful and looking at lifestyle that my bank account can't. We call it a champagne lifestyle on a lagoage and it didn't make any sense to me. You're for a little lightning round, a quick question. Just need a one or two. All right. So what is the slimyest trick a potential acquireer tried to play on you? Telling is that we shouldn't have got to use our contracts. We've done this numerous times. You've got to trust us. If you want a quick sale, you need to don't bother the legal team. And also they tell you not to speak to anybody else why you're selling. And I've got the same one buyer is no buyer for any purchase to try and buy your business. We'll try and tell you an exclusivity. They don't need to go to open market because they don't need to find out what the true value is or create competitive tension. That was one of the biggest mistakes we probably made. What are the big mistakes did you make in the selling process? IP contracts. One thing I didn't realize was that even if you're used third party, you might have an app. If you use third party developers or whatever it might be, unless they've signed the right IP contracts, when you come to sell that business, it can't be shown as an asset on your balance sheet. Even though we actually had contracts in place. So in the month we were selling the business, we were back dating contracts and getting people to sign contracts. It said that they signed over anything they created for us along towards that would be part of the sale. Now you think that would be quite easy, but imagine you've worked with a company for two and a half years and all of a sudden they want you to sign a contract. Then you start thinking, well, hang on, something must be happening. I don't want to sign this contract out because it must be something in their favor. So it caused quite a bit of tension towards the end because we had a very tight deadline at the end. We were trying to sell within 30 days. So I would say the IP contracts was a big one. The wrong accountants was also a big one. And then what's the first one to start off? I forgot the first one. Well, it's okay. We don't need to go through all these tensions. That was it. There are three things. Got it, got it, got it. What was the lowest point you reached emotionally during the process of selling your company? People talk about it being an emotional rollercoaster in a very difficult time in their lives for you. What was the it was quick though for us. It was only a month. So the month from the day they inquired, the day the money was in the account was 32 days. So it was very stressful. But we thought we were going to sell earlier in the week and we were told that the money was being transferred to us on the Wednesday and it never happens. So imagine you've let a business come in. They've pulled your business apart. They've had their audits to do your business. They've looked at every contract, how you marketed your business, how you own clients and you're kind of trusting them because you've never done this before. You're kind of trusting them that they are going to give you $8 million at the 8 million pounds at the end of this process, $11.1 million. Then the money doesn't come. You start thinking how have we now shown a potential competitor exactly how we built our business. We've given the key to our ship. We've let them run right from a month now. They could go back to America and just duplicate our model. Then it didn't arrive on the Thursday when they told us it was arrived on the Thursday. Now we were bought by a company that was listed on the list on the NASDAQ. So I think they had to announce certain things to certain shareholders and stuff like that that could just go through. So and they had an annual like AGM meeting on the Thursday. So again, it didn't happen. But they never told us this. It was kind of like, oh no, it'll be fine. It'll be out completed today. It didn't get completed. It didn't get completed the day after. Now imagine if you're going to bed thinking tomorrow I'm going to become a millionaire. You don't sleep. So by the time Friday rolled around, we'd had no sleep for 48 hours. And then obviously we sat in this list at his office and we waited and I just kept refreshing my phone and all of a sudden there was a few million pounds dropped in my account. That was it, don't interested. I got up. I got in my car and I drove to my local supermarket and I bought some burgers and some chicken and I bought six bottles of champagne and I went and had a barbecue at home. That was it. We went out to tell anyone. We went out to tell anyone to one day. So for the full weekend we couldn't tell friends family because it wasn't announced to the stock market until the Monday. What was that weekend like? It sounds mad. I was applying for jobs two weeks after I saw my business. None of this stuff is really of interest to me. I knew I was going to be a millionaire three years before. When I wrote down on that piece of paper and I wrote the plan and I'd execute it. After about nine months in that business, I realized I'm 100% getting the outcome that I want. Turns out I didn't get exactly what I wanted. But I got down close but there was absolutely no way it was going to fail at this point if I just stuck to the plan. So in a weird way, I used to say we're already a millionaire to someone else who's got my money at the moment. So I wasn't surprised at all. So when it happened, I was just like, all right, fine, what's the next thing? Let's go. So I was applying to work in real estate like two weeks after I saw the business. I wanted to learn about real estate and invest in it. But I could get no one would employ me in the local town that I'm from in England. Because they just thought these ways. Did you turn to for educating yourself about the sale process? Were there courses, be learning? Is there anything that you sort of looked into to learn the process? I didn't, nothing at all. I just went through it completely blind. Yeah, experience is the best teacher, right? So that's how I like to learn. That's why I was applying for jobs at real estate places. So I want to go to a property course and pay $2,997 to learn about property in 14 hours. Or do I want to get paid every month to learn a far better education? And that's why I go and do the things that I want to learn about. I think it's a far superior way of learning. Did you buy yourself any sort of trophy to commemorate the win? Other than the six bottles of champagne and the chicken and hot dogs? Was there any, was there any trophy that you bought to celebrate? No, I mind when he was all gone in about eight weeks. I just invested it all in different things like stocks and shares, property, of what I've heard has been Spain. But all investment, my actual real life, weirdly, I set up a bank account that would just drip feed me $5,000 a month, $5,000 a month into my account every month on the 28th of every month. So I just got paid a salary. That money was gone in my mind because banks forget about it for 30 years and just carry on as normal. I was 32 at the time. So what are you going to do? Sit round on the beach or hide yourself on the back and say, look how amazing it was. No, I've got like another 30 years this. So to me, it was just one thing I've done that I thought I was going to do. It's finished on to the next thing now. And speaking of the next thing, what is the next thing? Where can people find you? And you mentioned the online community. So like, what, what, so I've got an online community. So I've got like businesses now. I've got like a, we do YouTube for business. I've got a production company. I've got a podcast studio. I've got an animated explainer video company. And then I've got an online sales and marketing community. So the best place to find is YouTube. If you want to see some of the funny stuff that invested in. And I like to make a mockery of a lot of call sellers. That is youtube.com/micwinnit. And then if you want to see my actual views on my own sales and marketing community, that is use rmyown.social. And there, every week, I just answer someone's questions about, you know, how did I do my grill and marketing campaign? How do we do a billboard campaign? You know, how did I acquire business on LinkedIn? And I just give real life examples and cases of actual things that have worked for me and stuff that I tried that didn't work. Which I think is an important lesson that a lot of entrepreneurs don't like to talk about. I'll be honest, right? So I think anyone can fluke this. I think anyone can fluke a business. I don't really necessarily think a lot of entrepreneurs give enough credit to look because that damages the ego, right? Because they like to think that they were dead smart and they're clever and they thought that's an amazing idea. But I think if I started that business today, I wouldn't get the same results in two and a half years time. You obviously it was a good idea. It was the right industry. We did a lot of the right things to make it happen. However, we were lucky that there was a company looking to acquire our businesses, a business like ours, at that time. And that's why I don't think I could be on stage and say, if you follow my 67 step guide to business, you could sell your business for $10 million in three years because there's too many variables outside your control. So yeah, you know, I got lucky. Good idea. An important part of any success is luck. Might be a small part, but it's one of the most essential things we'd say. Yeah, what you want. And good execution and hard work and it sounds like you had those. Yeah, so there in, you know, good idea, execute the plan of all these things, talent, but luck is a very significant part that most people don't like to credit because it takes away from their brilliance. I've got absolutely no problem with saying it. And so I don't think it was my big one. I think I've brought another big one in me. I mean, that's what I'm working towards at the moment. Well, we'll be following this story on YouTube. I'll put all the show notes and those links to your YouTube channel. And views are my own in the show notes. I built the sub.com. Mike, thanks for doing this. No worries. Thanks for having me. And there you have it for today's podcast. I hope you enjoyed John's conversation today with Mike for show notes, including links to everything referenced, including the YouTube video. I mentioned at the beginning of the episode. You can go ahead and visit the episode page, which can be found over at builticell.com. If you enjoyed today's episode, then be sure you're subscribed to the podcast. If you love today's episode, then share this podcast out with a friend or colleague who you feel like would be truly impacted by today's conversation. If you know of someone who would be a great guest right here on Built to Sell radio, you can actually nominate them. Some of our best guests, like Mike, have been nominated by others. So you can go ahead and visit builticell.com/nominate, where there you can nominate someone else or yourself to be a guest right here on the podcast with John. Special thanks to Dennis Labataglia for handling the audio engineering. And thank you to our community of certified value builders who help us bring our message to you. Our advisor community or experts in helping you build the value of your company. To find an advisor or learn how to become one yourself, visit valuebuilder.com. I'm Colin Morgan. Talk to you again next week.