433 – Selling a Web Design Business with Hans Skillrud, Jake Kramer and John Wooten “Buy or Sell” series pt. 2 of 2

Cold Open: The Dream Support Hire

John Wooten 0:00

If I was buying artillery and I’m interested in buying Jake and John out, and they tell me, Yeah, hey, this gal Clara, she handles all the support tickets, she delegates, she gets everything done, works with the pulls in a junior designer or junior developer when she has to, she’ll run the whole thing for you on the recurring revenue side, on the hosting maintenance side. Done deal. Like that’s that’s no more extra on me. You know, you know, if that comes with the purchase, absolutely. I would I would buy that business faster than one that didn’t have it.

Why Sellable Agencies Win

Josh Hall 0:30

Welcome to the web design business podcast with your host, Josh Hall, helping you build a web design business that gives you freedom and a lifestyle you love. All right, friends, as promised, here is part two of our little buy or sell series. Last episode, we dove into what it looks like to acquire a web design business. This episode, we’re diving into what it looks like to sell a web design business and more specifically what it takes to create a sellable web design business. If this is something that you’re interested in doing in the near future or if it’s way off, but you’re just curious about making sure you’re creating something that’s sellable one day. That’s what we’re diving into. We’ve got back Jake Kramer from Artillery Media, Hans Gilrudd from Termageddon. And in this one, we’re adding an additional guest, John Wooten, who is Jake’s partner in Artillery Media. And John specifically has a lot of experience with creating and just making sellable assets as business entities. He’s got a lot to learn from, and we’re gonna dive into all that and more in this episode with how to create a web design business that is sellable one day. Now, before we dive in, this episode is presented by the SEO sales call bootcamp. At the time of releasing both of these episodes, you can still get in on the very start of this bootcamp. The way to do that is to go to my link, joshhall.co slash LSA. That is short for local SEO Academy. Because when you use my link, you’ll be able to join Local SEO Academy for $50 off on your first month. So it’s only $99 to get access to this SEO boot camp that is running live through the entire month of July, and you’ll get your first month of Local SEO Academy. Again, $50 off. So go to joshhall.co slash LSA, jump into Local SEO Academy. They are a proud partner of my community Web Designer Pro. The founder, Sam Sarzden, is one of our rock star Web Designer Pro members who has become our king of Local SEO. He is on the front lines and knows exactly how to sell SEO because I think I misspoke on the last episode. He has actually just this past year done over $265,000 for his agency. And Local SEO is the biggest chunk of that. So you’re going to want to learn from Sam only if you want to make a lot of money with SEO and recurring revenue with SEO. Josh Hall.co slash L S A to jump in there. And of course, if you catch us later on, you can jump in and watch the replays. All right, my friends, let’s talk about selling a love design business and making your business nice and sellable. All right, gentlemen, using the term very loosely for this group, but uh man, so good to do part two of our little uh mini-series here on buying, acquiring, and then also selling a web design business. We have an extra special guest here, John Wooten, Jake’s partner in Artillery Media. We’ve got Jake back and we’ve got Hans back. John, I specifically wanted to make sure we included you on this one because you uh, when I think about selling a web design business, you come to mind because you actually told me about this book. Oh, yeah, a good one. Built to sell on the podcast. Probably what, circa like 2000? Like probably. Like maybe, maybe early early, early on. It’s a book that I recommend in my business course. Um, and there’s a ton of stuff covered in there about making a design business syllable, but you know, we’ve all got experience either selling or just knowing what we’re looking for if we’re acrying a business. So super pumped about this one. Real quick introductions again. We’ve got Hans for Termageddon. Hans, what’s your experience with selling? Just the quick elevator pitch of what your experience with selling has been.

Hans Skillrud 4:20

Yeah, so back in my agency days, I bought an agency which was very successful for me. And then I sold my own agency, which was uh successful as well.

Josh Hall 4:28

So did you so you sold after you had our acquired an agency prior to that?

Hans Skillrud 4:33

Yeah, acquired, like ran an agency for like five years, lost a lot of hair, um, then kind of learned how to create nice little processes, acquired an agency, and then a few years later, you know, married a privacy attorney, started Termageddon. I had to I had to sell the agency at that point, just I couldn’t, my brain’s not big enough to manage two companies. So yeah.

Josh Hall 4:53

And John, what’s your experience with selling? Now you’ve been obviously, you know, one of the leaders in the Divi community with child themes and selling products, but selling agency-wise, what’s what’s your experience on that?

John Wooten 5:05

Uh I haven’t sold, well, well, I guess I have we haven’t sold artillery yet, obviously. We’re still growing it. Um, the plan is to someday sell it, maybe when we get maybe in 10 years or so. Um, you know, maybe by that time we’ll have roughly what, Jake, like 1,500 sites hosted, probably. Um, why stop there? Because I because John doesn’t want to get too old, but um but I did just actually I did just actually sell uh sold a web design store actually. I just sold Superfly a couple few weeks ago.

Josh Hall 5:43

That’s kind of what I was thinking, yeah. Yeah, like you know, any realm of selling. Because I’m sure those lessons with that could translate to a web design business, I imagine.

John Wooten 5:51

Yes, the power was the uh memberships. So just like on the web design business, most of your bang for your buck is gonna come from your hosting clients, the recurring revenue. Same thing when we sold that web design store was the the power of the memberships is uh where it’s at.

Josh Hall 6:08

And in our

Pricing That Raises Business Value

Josh Hall 6:10

conversations leading up to this, Jake, you had mentioned I think maybe it was off record where you had talked about like if you want to make a business, a web design business sellable, raise your rates. Make sure you’re not you don’t have like terribly low rates because that’s gonna just gonna be uh a devastator as far as your worth as a business.

Jake Kramer 6:32

Yeah, higher your rates, higher the worth of your business. There it is.

John Wooten 6:38

Well, and it’s and it’s uh it’s it’s no fun. Uh so you know, for example, we we bought you probably when it’s the last podcast, but we bought um like almost 30 sites from a guy who was retiring and his hosting rates were super cheap. And uh you know, our first interaction with his clients are like, hey, we’ll honor that for a couple months, but then we’re gonna have to raise it to our to what we charge our clients. And that’s just no, that’s not a fun way to begin a relationship, right?

Jake Kramer 7:07

But but it’s also it’s also an XY graph. You know, you got price, that’s an important piece, but you also have to stay competitive. And if volume is the name of the game, like it is it is at artillery, we want a lot of small to mid-sized sites. So yeah, our pricing’s important to be competitive, and yeah, we do raise prices. We just raise prices for our smallest tier package for the first time in four years. We have a handle on that, but also if you’re charging way too much and you’re trying to jump ahead, or maybe you’re a smaller designer and you’re trying to get to agency level, you still have to be just cognizant of well, if the client’s looking at you, the price is still a consideration to them to make that decision. So there’s two sides of that corn corn. Here I am in Nebraska at the end.

John Wooten 8:02

Well, and if we don’t buy it, if we don’t buy it, um and you have a hard time selling it, what’s the alternative? Let’s say you can’t sell your business because you’re charging $29 a month for hosting or something ridiculously cheap like that, thinking you’re doing a client a favor by saving them some money. But then when you go to sell and nobody wants to buy it because it’s just maybe you want too much, or who knows what. Um, so now your clients what? They’re gonna have to manage their own hosting, they’re gonna go get their own site ground or God forbid GoDaddy account or who knows what. Um, so it’s just not it’s not great overall. Um, so yeah. And also the smaller, the smaller revenue you’re doing, um, you’re not gonna get a high multiple on your business because some other small business is buying you probably, versus where let’s say you’re let’s say you’re making uh 50k a month in recurring revenue. Well, now some large agency that’s probably 10, 20x the size of you is gonna give you a good multiple on that because they can offer other services to, you know, we only offer web design. We don’t do print, we don’t do SEO, we don’t do ads, none of that stuff. So if we get acquired by a larger agency, they got a whole bunch of customers they can they can pitch their other services to now. So that’s another thing, too.

Jake Kramer 9:18

And that would certainly be our angle is we’re proficient in this one space. We’ve never upsold this space. They trust us to the point where they’ll call me and ask me about photographers, so or anything else. So that is such a huge opportunity for a buyer, not saying that we ever would. The other option there is we continue to increase revenue on kind of a referral basis by having people that we trust and outsourcing that specific work. But I can just see the value to potential buyer for someone as an agency, just as the way that we built it. A lot of small to mid-sized businesses that are all growing because they’re paying competitive rates for website hosting. They need a professional website to help grow their business. Their businesses are growing and they trust us. And I know we kind of talked about last episode, Hans, you’re kind of talking about more of the nitty-gritty of that, the terms of that, you know, no, no pun intended with your background. But how do we want to lock them into annual contracts, monthly? Do we want to charge for the client book? Do we want to do the referral base after the sell? I know we kind of dove into that, but maybe you could kind of recap your position as well. And we could keep going from there.

Hans Skillrud 10:46

For sure. You know, as for like what to charge for maintenance and hosting, especially when you’re trying to sell your business, like if you’re underpriced, first off, you’re hurting yourself. And I think it took a lot of struggles, personally speaking, to like realize when I’m not paying myself appropriately, I’m actually hurting my customers because I will burn out and and then I will want to sell my business for pennies on the dollar. Where if I just you know sucked it up a little bit, charged the right price, I would actually be much happier. And as someone who I remember the first time I raised my prices, it called a hundred customers when I did, you know, just for ease of numbers, but I think we lost three customers in that process, and the price change more than covered the loss of three customers. And those three customers that left, we were all high-fiving. It was like these are the meanest, worst customers. Like raising your prices is the most glorious thing because it somehow does this magical thing where it gets rid of the people you don’t actually want to work with. And it’s like people who pay you the full, like the new price, they respect it. Like you’ve you’ve just done the most glorious thing for your business. So, like, outside of selling your business, charge what you deserve to be paid. Like, you need to do that for your mental health and for the sake that it’s gonna you’re gonna get rid of the bad people too from your from your business without having to directly fire them.

Jake Kramer 12:03

So anyone can again for the people in the back. Nail it.

Josh Hall 12:11

That’s the clip, that’s the clip for this this episode. Hans was the clip for the last episode, too. Hans is a clip machine.

Hans Skillrud 12:16

Um well, it’s all but I’m not see, I’m not in the game anymore. So it’s so easy for me to like say that, like, because it’s like, you know, I I’ve lived it, it’s hard. You know, it’s very oh Hans is saying raise my price. That’s so easy. And then when it comes time to click and send in that email, it’s like cool, that’ll that’ll sure, but uh hard. You’re right, though.

Jake Kramer 12:35

But every business, every business, this is in every single business situation. This is in every relationship business, this is everything, you know. If if I’m putting effort into this, you need to be reasonable about that effort, whether it’s for their price, for their time. I think every business can relate to that.

Hans Skillrud 12:54

Yeah, I think most partners, most agencies, what are they talking? Raising their prices like 3x at the absolute most. Like, I mean, if they’re like grossly under charge, if they’re charging like $20 a month, like, yeah, you are you’re not in the right world right now, buddy. You gotta get to you, you need to those are rookie numbers.

Jake Kramer 13:11

And we’re not and we’re not being and we’re not being crude. And then and then I’ll shut up here. I you know, we don’t want to just raise prices for raise prices’ sake. You we again, it’s it’s the reality in which we live. We have to be cognizant of 3% inflation every single year. So if you’re not raising your price by at least that every single year, you are quite literally lowering your prices over time.

Hans Skillrud 13:35

Yeah, that’s your purchase.

John Wooten 13:38

And employees want raises.

Hans Skillrud 13:40

Yeah. And and the subscription services you’ve signed up for want to raise their pricing. So yeah, Netflix and reasons. You just need to run a business, and this is a part of running a business. Disney Plus. Oh my gosh. Yeah.

Jake Kramer 13:54

So they’re frogboiling us over there at Disney Plus, that’s for sure.

John Wooten 13:58

Hans, you’ll like Hans, you’ll like this. We have a we have a we have a point system. Every year we try to get to 80 points. Usually it’s about 60 to 80 websites. And I’ve been trying to tell Jake, like, hey, if we go over the 80 points, for every point we go over, we need to fire a current client. Like, let them go. And that’ll force us to get rid of the ones that are just pain and you know. Yeah. I mean, it’s not the 20, you know, usually they say the 2080 rule, 20% of your clients cost 80%. For us, it’s probably more like 5% of our clients cause 95% of our headaches. So I’m just like, well, let’s just, let’s just, let’s just fire those 5%. What a good plan. Let’s just get rid of them.

Josh Hall 14:36

The web design business coach and me would say smoke them out, like raise their rates on an individual basis, um, based off of base, basically like priority. Like, say, like, you know, you guys need the priority. We could do it. It’s gonna be this rate. Um, otherwise, adios Muchachos.

Jake Kramer 14:55

John, John, you would have been an absolutely brutal like rancher. We get 80 cattle a year. Okay, here’s the pistol, John. Go out and find those bottom tier cattle. Brutal.

John Wooten 15:06

You know, I’m not a good, I guess I’m not a good Christian. Like, Jesus left the 99

Deal Killers: Plugins, WooCommerce, Chaos

John Wooten 15:10

for the one. I’d been like, ah, forget it. Let that one go.

Josh Hall 15:14

This is the most Midwest. That’s why you’re not Jesus Christ. This is the most Midwest analogy-filled episode for sure, which happens with a couple Nebraska boys. So um that’s true. So let’s let’s do a high-level look at like what makes a web design business sellable. We’ve hit a lot on recurring revenue, of course. I mean, that really is truly it. A book of clients, like your book of clients who may or may not come over with them. Perhaps like potential projects, which I guess would be lumped in with them, uh, like potential work, additional packages, rebranding, redesigns, etc. Um, any processes or systems that you have in place that could be almost like IP? Like I guess, in a way, you could sell intellectual property with a web design business if you have certain processes you do that are unique. Um your network, like referral partners. What else? Is there anything else I’m missing with what makes a web design business sellable?

John Wooten 16:16

Well, I can tell you the two reasons why we didn’t. We we were talking to a web designer, solo person, freelancer about buying their business, and I can tell you the two reasons why we didn’t. Um you know, on the surface, at first glance, it looked like everything was great. All the sites were in Divi for the most part. Couple were in Elementor, that’s fine, whatever. Um But the the biggest thing was, oh, and they were all look, they all look simple. Like when I went and visited them, it was all like, okay, yeah, this is you know, this is this is fine. These designs are okay. Actually, I think we can we can uh elevate these, you know, like okay, we’re gonna be in we’re gonna be in good, they’re gonna be in good hands here. But the two biggest things were number one, the pricing was too low on the monthly hosting, and to try to uh there was some concern about how many people are gonna stay once we raise them from 29, 39 bucks to 69. Um, and then the other concern was uh I log into these sites and um more than probably three-quarters of them have like 30 plugins, you know, and WooCommerce on most of them, which I hate. I absolutely hate WooCommerce. I hate it. Um and that in the end, that was the big reason why I was like, man, I don’t think we want these. These seemed like nice. Oh, and the other reason was um the web designer was allowing clients to like call her and text her all times of the week and weekend and stuff. And it’s like, man, we we don’t offer that level of, you know, it’s gonna be a it’s gonna be a big shift. Uh I just felt like it was too big of a shift. And then she also wanted a lot. She wanted probably three times what we were kind of thinking of paying. Um, so I guess there’s three reasons there.

Speaker 4 18:02

Yeah.

Hans Skillrud 18:02

What a good example for anyone listening, though, is like this agency was undercharging for maintenance. I mean, I think anyone, anyone long enough in the industry can all agree $39, $29, $39 a month is not an appropriate fee for like, you know, a small business agency owner to be surviving. This person was undercharging compared to artillery, who is working with a massive amount of customers. And so I’d imagine they mentioned even in this recording, like their price point, uh, having a very competitive price point is one of their primary goals, like $70 a month. Um, so like anyone listening who’s charging $40 a month, like artillery, which is a they’re playing like the selling Toyota game. They’re not selling Bentleys, they’re selling Toyota’s like boom, boom, boom, boom, boom. They’re at $70 a month. So if you’re under $70 a month, you got to be thinking to yourself, like, am I under charge? Am I underpricing myself right now? And like, how can I get myself out of that problem? Because this person was charging $29, $39 a month and available on weekends and nights. It’s that’s there’s something broken there. That’s a broken, that’s a broken model right now. And I’ve lived it. I know I’m saying that because I lived that myself. I know what it was like working 22 hour days, um, you know, and and just sleeping for just a couple hours and then getting right back to it and undercharging.

Josh Hall 19:17

So also something you hit on, John. I never thought about that, but boundaries are like a sellable asset for a business in some ways. Because yeah, like you’re totally right. If if clients are ex are used to breaking boundaries that an agency is not gonna budge on, then that’s that’s gonna throw a wrench in that for sure.

Hans Skillrud 19:39

I’ve never I’ve never thought about that, but it’s so true. Like, if you’re acquiring a business that has the the the previous the seller has been running a a zoo in terms of like just people calling all the time and expecting the world at any time of day, that’s that’s not attractive to a buyer.

Josh Hall 19:56

On the flip side, uh the uh person I mentioned in Web Center Pro who’s looking at potentially getting over 30 clients uh purchasing or acquiring a different business, the tables were flipped for him, where it was like he actually is used to responding within 24 to 48 hours. And this book of business that he’s looking to take on, he asked that owner, like, you know, do you get back sooner than 20 or 48 hours? And he was like, God, no. He’s like, no, he’s like, I’ll get back within a week if they’re lucky. Uh so like for him, it was opposite. And he was like, Yeah, my clients are like a week. That’s like, oh, that actually, yeah, kind of you can learn from acquiring a business too, I feel like, if it’s a little more sellable.

Hans Skillrud 20:37

By the way, so after selling my agency, we have like a web developer who works for like, you know, uh, an agency that we hired. And I’m not gonna share names because well, it’s probably a publicly available, but I’ve I’ve hacked them for the record. I figured out how to hack them. I always say, This is not urgent. I always have my subject like this is not urgent. And for whatever reason, he does it in like two hours, even though I always say it’s not urgent. So I feel like saying not urgent actually motivates an agency to just all right, I’m gonna knock it off with this nice game.

Josh Hall 21:04

I’ll make it urgent. Oh, yeah.

John Wooten 21:06

I could have got over, you know. I think I could have gotten over, um, I could, I could have gotten over the the pricing deal. Because we’ve done that before. When we bought the 30 sites, um, the guy was offering two services, hosting for 29 bucks, $19 if he were a nonprofit. And then he was offering a separate um, oh gosh, what do you call it, Jake? Not maintenance, but patching, patching service, which is a terrible name, by the way. Don’t call it a patching service. Don’t, don’t do that. And and that was $39 a month. So some of his clients had both, $29 and $39. Okay, cool. That’s right in the ballpark. But but about half of them didn’t have it, didn’t have the patching service. And I’m like, why in the world would you host sites that are not being updated? Um, but so I probably could have got past the pricing and I probably could have got past the setting boundaries. But it was the it was the WooCommerce and and like there was one site that had over 40 plugins. And it was just like, yeah, no, I don’t want to figure out I don’t want our team to I don’t want our support gal, who’s already overloaded sometimes, have to figure out this maze of plugins. Like keep your sites simple, keep them clean, don’t let your clients install crazy amounts of plugins. Um so that’s a that’s what I was doing.

Jake Kramer 22:22

What did WooCommerce do to you, man?

John Wooten 22:24

Well, they stole half my last name for one.

Jake Kramer 22:27

True.

John Wooten 22:29

Nicely done.

Josh Hall 22:30

Oh, that was a good one. Let’s go get them. It is a shame that John doesn’t love Woo because like Wooten, you know, Woo, Wooten Commerce. I mean, that could like what a child theme for WooCommerce. Wooten Commerce.

Jake Kramer 22:44

Come on, it’s also Yeah, it is great.

John Wooten 22:47

I think I hate it because the the Superfly store was on WooCommerce and just all these extra add-ons that you gotta have. Um, I just I’m not a huge fan of how they do it. Um, I wish they would just uh I’m just not a huge fan of how they do it.

Jake Kramer 23:00

Yeah, it’s a Frankenstein. Taylorswift.com is on WordPress, and you click shop, it takes you on over to store.taylorswift.com. Guess what? Shopify.

Boundaries And Support Tickets That Scale

Jake Kramer 23:10

WordPress and Shopify, baby. Yeah, that’s what we try to do.

Josh Hall 23:13

Yeah, uh, you you had mentioned team. That’s another aspect of what could potentially be sellable as a business if it’s scale for hands down. What are your guys’ thoughts on team and how to make that um everyone on the artillery team? Don’t worry. John we’re not selling to Hans Live on this call, but the idea of even building like a collaboration network is like equally sellable if you have a support system in place.

John Wooten 23:40

If I was buying artillery, let’s say I worked for uh, you know, a different agency, and I’m interested in buying Jake and John out, and they tell me, yeah, hey, this gal Clara, she handles all the support tickets, she delegates, she gets everything done, works with the pulls in a junior designer or junior developer when she has to, she’ll run the whole thing for you on the recurring revenue side, on the hosting maintenance side. Done deal. Like I that’s that’s no more extra on me, you know. That’s that’s what I want. But if I have to add this, all these customers to my current, you know, team, um, then I gotta figure out, you know, at some point Jake and I are gonna have to add a second support person, right? Uh, and that’ll be tricky to do, right? Because it’s not like a fun hire. It’s it’s not uh, I mean, we can we make money off support, obviously, like that, but it’s not like you’re adding a new designer that’s gonna help you crank out 20 more websites a year or something like that. Um, so it’s not a super fun hire. But, you know, if if that comes with the purchase, oh absolutely. I would, I would, uh, I would buy that business faster than one that didn’t have it. Now, obviously, a lot of us are freelancers, we don’t have a support person, that’s fine, but still just keeping it uh having some kind of expectation set up with your clients that you do have, and them understanding like even them, even them, even them going to fill out a support ticket or something like that is better than just them randomly emailing you all times of the day or texting you, God forbid, you know. Um, so yeah.

Jake Kramer 25:09

You’re super right, but shut up. You didn’t even hire me. So, what do you know about hiring?

John Wooten 25:14

Oh man, here we go.

Jake Kramer 25:18

I’m just kidding. Some other No, that’s actually true, though. It is true. Take it away, Hans. I’m being ridiculous.

Hans Skillrud 25:25

Some other uh thoughts just um to take into consideration. I I’d imagine the the one that um John and Jake were looking at what they ultimately said no. I’d imagine one thing that was really attractive is sounds like this person was just doing web design and hosting and maintenance. Uh something that’s less attractive to me would be like, oh, I’m doing web design, hosting maintenance. Oh, it turns out I’m, you know, you open the books and you realize, okay, they’re managing 40 email servers. They’re doing Facebook ads for just one customer, they’re they’re trying to do SEO for another customer. It’s like, oh my gosh, turns out they’re doing like 30 services. They’re trying to make it one thing, but they’re doing all these different services. And that’s kind of what I think we talked about that on our last interview, but like you go through this phase of an agency, at least I did, where I said yes to everything. I thought that’s what you do in business. And then I learned, actually, no, in business, you do the opposite. You say no to everything, and you only just do one thing as best you can. And and that was, you know, you make it, if you make it through that filter, you you graduate my mind, um, you know, in the agency world. Um, once you’ve decided, no, I’m just gonna do one thing, I’m just gonna say no to everything else because this is the one thing I enjoy. So that’s much more interesting to uh when selling, you know, just like how if you sell a niche web design business, you probably are dealing with higher multiples when doing a sale because it’s niche down. It’s maybe you have a name in a particular industry. It’s the same concept with your service offerings. If you’re only offering one service, that’s just more attractive um um to the right buyer. Um, where if you’re all over the place, well, now you have to find a set a buyer who’s all over the place and is willing to adopt your crazy port program into their crazy program.

Josh Hall 26:58

So that is a great point, Hans. Additionally, like another version of that is also your tool stack. Like if you’re doing WordPress and you’re doing Divi, Elementor, Bricks, and you know, the block editor. Also, you do have some Squarespace sites and some show it sites or whatever it is, like, and some Woo and some Shopify. It’s like, woo, you gotta find a buyer now who is either comfortable with all those tools or is down to like get your clients migrated over to their tool stack, which just adds a lot of complexity when trying to sell.

Hans Skillrud 27:37

A good thing, a good thing to aim for is like when you go to Walmart and you take a piece of a thing, a laundry detergent off the shelf, that’s an easy transaction. I’m going into the store, I’m taking this thing off the shelf, I’m gonna go buy it and leave. Like, if you make that your goal in terms of structuring your agency, especially anyone structuring it to sell, you you’re doing it the right way because the easier you make it to leave, the buyer to come in and leave with it, the the the less friction there is, the less uh second guesses there is. You’re making it easier for absolutely absolutely everyone in the you know in that situation.

Josh Hall 28:06

Hans, can you try to keep your analogies specific to cornfields or country for Jake and John? Otherwise, they won’t get it. So it’s like going to the tractor store, finding the right to cloud.

Hans Skillrud 28:17

I didn’t mention Walmart. I mean, uh, come on, I’m like somewhere

Productized Services And SOPs

Hans Skillrud 28:20

in the ballpark, but that’s close, yeah.

Jake Kramer 28:22

Okay, I have a couple thoughts on this. Number one, you brought up built to sell uh old Wu-Tang, old Wu-Ting’s uh Bible, his bibliotheca right there. Productizing your service business. And that happens in a couple different things that we’ve talked about. Number one, a team. Rich dad, poor dad, four quadrants of wealth. If you’re into that kind of uh books, talks about the final quadrant is a business that grows without you. You can’t do that without a team. And you can’t, I would argue, sell anything for a uh worth unless you have a team. Sure, you could sell just your your own, but they’re they’re they’re looking for John uh Alex Stapleton agency, right? From the book. Okay, so Alex, the owner of the agency, had to remove himself in order in order to do that. Then as our friend John and John and my friend Clint is has been kind of talking about as he has sold his agency to a Fortune 500 company, how do you make it good for your team to sell? What does that look like? And when you’re selling, can you include some nice little things for your team so it makes it good and easy for them too? For example, higher salaries, uh, whatever it might it might look like. So pro and then the third thing is that process that you kind of talked about early on, Josh. That’s a lot more indirect, I would say, in value. No one cares if if you publish your process, like you’re not gonna sell it that way. You are gonna sell it in the sense that it’s like the tortilla that wraps everything up. Uh that that nice corn burrito that you that we’ve had. In the sense that if you can prove over time, hey, this process has contained all of this. It’s held together this this again, like you said, Harns, like a niche business, time and time and time and time and time and time and time again. We’ve changed the oil, we’ve changed this piece, we’ve rotated this, 10 years have gone by, and this process has held up. That the timeline of it is a lot more valuable than the just some published crap, right? So the I would say the the process is a lot more important, uh kind of, I don’t know.

Josh Hall 30:47

I would view it as an S. I guess I’m thinking more of as an as an SOP. And I heard yeah, because like when I sold in transit to Eric, who was one of my students, what made that so easy for both parties was he literally took my entire tool stack, went through my maintenance plan course, used everything I did in there, all my sales scripts, all my SOPs, and that became the business without him needing to figure out like, well, how do I figure out how to do maintenance?

Jake Kramer 31:16

Exactly. Yes, exactly.

Josh Hall 31:17

Yeah, it’s almost yeah, there’s all yeah, there’s a few different versions of probably like an SOP for you know one thing versus like a whole wing of services. But then there’s also the productization of yeah, building websites if you have a process around that. So I think the more yeah, the more you make your business sellable, run it like a sellable business, the better for sure.

Jake Kramer 31:39

Yeah, absolutely. The final thought I had there was just um well, now I lost my train of thought.

Hans Skillrud 31:49

Sorry, I kind of come back to Jake. Don’t worry about it. I think that’s where you’re at, Jake. That’s where I was at.

John Wooten 31:56

Jake does love Chipotle, I’ll say that. Um, I I have two thoughts on that. Number one, read Built the Cell or listen to the audiobook like I did, like 20 times while you’re out jogging or riding your bike. That’s what I just listen to that book so much. Um, because I’m pretty sure the uh yeah, the acquire ends up being a larger agency that does can offer other service to his book of business. And then when Jake says, hey, it’s it’s gonna be hard to sell um for a lot of for a decent amount of of money without a team, um, yeah, because a solo a solo freelancer, you can only manage and host and build so many sites. And so you have to bring someone like Jake, like I did, eventually, you know, on a subcontracting basis, not as a hire. Okay, there you go. And uh, you know, because you can only handle so much by yourself. So eventually you’re gonna have to figure it out and and bring some people in, um, which at first is not gonna be fun because you’re like, oh, I’m paying money to this person and blah, blah, blah. But it increases the value um of your business. And then what Josh said about the tech stack being consistent, really helpful. In the in the first deal that we were working out with this guy, um, he uh he had uh yeah, about 30 websites and about 21 of them were Divi. The other nine were Elementor and I think X Theme, something like that. And uh he wanted a certain amount per site. And I said, uh, we countered with a with a lower amount per site, and then he um came back with like pretty firm on what he wanted, and I said, I’ll give you that for the Divi sites, and then you can go sell the other nine sites somewhere else. Or I’ll give you this per site for all 30 of them. And he ended up doing that. But that’s just again to show the value that I put on the, yeah, I’ll pay you that for the Divi sites, absolutely. Like we will take those because I knew they weren’t gonna be additional headaches for us and for the team. Um, so that’s you know, that’s important too. I think uh, oh, go ahead, Jake.

Josh Hall 33:50

I don’t want you to lose it again.

Jake Kramer 33:52

I remember my train of thought, and it’s a question for Hans. So similar to the Built to Sell book, the Alex Stapleton agency, which if you if you don’t read the book, I’ll summarize it for you. The guy productizes service business by creating a process of selling logos, and that helps his business be sellable, predictable, all kinds of things. Cool. Big mistake.

John Wooten 34:11

He should have done websites doing logos, non-recurring, whatever. Non-recurring, no recurring revenue. He should have done websites.

Jake Kramer 34:19

You know, very easy for clients to say this isn’t good. You know, it’s it’s not a great business.

John Wooten 34:24

That was the only part of the book where I was like, what? Anyway, why are you doing this?

Jake Kramer 34:27

It’s totally a non-designer wrote that book. Like, don’t do logos, it’s awful. Anyway, uh, unless you’re doing the website, do the logo if you’re doing the website, then it then you can get recurring revenue. That is. Anyway, okay. If we create a niche business like you did, Hans, like you’re currently doing. Do you do you like the pattern or the maybe the strategy? Like that go. We keep mentioning Clint. He’s kind of John and our mentor in this space locally, because he’s done it, we’ve seen it. And what he did is he has his agency, it’s called our tribal, and it’s niche specific. I mean, it’s pretty big agency, but they do a lot in a small niche, youth culture. So it has to fit in in that space, youth culture. And so that allowed them to do what you’re saying. There’s a vertical, but then Clint is also really good at branding a certain type of business. I don’t want to get too specific. So whenever a lead came in, he he would kind of funnel that over to this other business, essentially fast-forwarding to this, saying, the more you niche down, the more you can just sell individual businesses almost as like slices or chunks or monoliths. John and I, if we do it right, we’re not saying we’re gonna do this, but should we ever want to, we could sell the artillery side, the website side, and still have another business that we end up kind of doing once we do that sell. So the more that you space SOPs, lock down your process, niche down, not only do you you get all these benefits that we’re talking about, a team that really knows the space, a process that’s proven, fantastic product, fantastic service. But then you can also sell that stack and still go on and do other things, should you want to. So I’m kind of curious if that’s kind of how you saw that. You know, you you’re kind of pulled from the agency side into the product side. Yeah. Tell me, tell me kind of about that idea.

Hans Skillrud 36:22

Yeah. So um makes total sense. I don’t know why, but I saw like a cell, you know, like cells um turn into two and they separate into their own kind of little worlds. Like it’s kind of like that. Like from what you build, something else can kind of come from it, and you could sell that piece off or the other piece, and then you can go your merry way, and the other company can go their merry way. I think that happens all the time. And I think in agency life, it happens all all the time as well. What was my unique situation? I was an agency owner who happened to be dating a privacy attorney, and over dinner I told her, yeah, whenever my clients ask me for policies, I just copy one off the internet. And she was like, You realize how bad of an idea that is, right? And I’m like, okay, fair, but my clients aren’t gonna pay your prices, and one thing led to another, and we started termaged in. But that would have only happened had I exactly understood that use case where customers right before Silence, what should I do for policies? I’m like, I have no idea, I’m not your attorney. And like, and then before we know, project delays, all that stuff, and that’s why I built Termageddon to solve that problem. And lo and behold, I wasn’t, it turns out I was I thought I just built it for myself, and it turns out every is like an industry-wide issue. Like, no one knows what to do for this stuff. So um, so that’s why I think Termageddon spun off, and and and I had to make that difficult decision to sell my agency, go full-time Termageddon, um, which was you know, my agency was everything I knew, and Termageddon was $50 MRR at the time, and I was just on a wing in a prayer. But, anyways, um I I’ve heard so many stories about agencies spinning off various things, whether it be a web building uh group of maintenance clients, they sell off or they build a product um like Termageddon or something. Um Web Designer Pro. Yeah, what yeah, perfect example. Like, I think we’re all naturally got we all naturally have that entrepreneurial spirit. Like we were all willing to many of us were willing to give up a full-time safe job, quote unquote safe. I love how people call it safe. I I don’t really buy into that.

Jake Kramer 38:17

Um that’s safe. You have one client.

Hans Skillrud 38:22

Exactly, exactly. So true.

Jake Kramer 38:25

Um I’ll take 500 clients, please.

Hans Skillrud 38:27

Yeah, exactly. Yes.

Josh Hall 38:30

Even with that idea, Hans, like even more so as an entrepreneur who most web designers are full-blown entrepreneurs, whether they realize it or not, and they’re gonna want to do something eventually. It is like uh beyond crucial not to create a job, but to create a business. Because really what like Jake and John, what you guys were talking about is when you what a lot of web designers are trying to do is like if they get to a point where they want to sell, they’re trying to essentially just sell a job. And no one wants to just buy a job and do an extra 40 hours a week of work. Um, you gotta, yeah, you have to really think about building it as a business. Even I found that even if you don’t want to sell or that’s not even on your radar, just building your business to where it’s it’s sellable is going to open up so many avenues for you. And you’re just gonna save time running it and enjoy it a lot more. More freedom, yeah.

Jake Kramer 39:26

Gentlemen, talk about this a little bit because artillery and our our bromance, and then the band and how you know your relationships through artillery, your tech knowledge kind of led into fun. I’ll talk about that real quick, and then kind of talk about then finally superfly and how you had this kind of three-part thing that you had to simplify and the reason for selling. Kind of give us an overview of all your entrepreneurial dealings as it pertains to this.

Josh Hall 40:00

I was gonna ask why or when to sell, to kind of add a little spice into there, too.

John Wooten 40:08

I’ll tell you why I sold Superfly.

When Selling Makes Sense

John Wooten 40:10

Um or why why Nathan and I sold it. Um because we both had artillery, you know, we both had web design companies. Nathan, more so web development and support, big on support. Like he’s you know, our recurring revenue as web designers is hosting. Um, his is also hosting, but also support contracts. Um and so we had we each had these you know businesses that were doing great, growing year over year, consistency, um, not slowing down, not stopping. And then there was Superfly, which was uh which was steady, but it was like, you know, for two people, we’re sharing the profit. It’s not, it’s it’s a it’s a good amount of profit um for for a part-time situation, but neither of us was gonna dive in full time and give this thing the energy and the creativity it needed to grow. And I remember just telling him, man, I think this would be perfect for for John 15 years ago, a solo person that’s a part developer, part designer, aka diviner, as we call them. And uh, and that would be and and it’d be it could be right away, it could be their full-time job if they wanted, and they could grow this thing and make a really good living, really good income. Like that’s why I I decided to sell Superfly. Um to himself.

Jake Kramer 41:29

He built a time machine and sold it to himself 15 years ago. No, he again, he kind of did he pulled the Josh Hall book, and we found anyway. I’m interrupting you.

Josh Hall 41:39

Well, now if now I don’t I don’t have the story on there, yeah.

John Wooten 41:43

Uh what go ahead, Jake. What story is that?

Josh Hall 41:46

The the Superfly sales story. I didn’t know who you sold it.

John Wooten 41:50

Oh, I sold to a friend of mine, son, son. Actually, I sold it to one of one of our employees who’s running it now. Um and he’s what, 21 years old, 22 years old, you know, 21, 22 years old, not married yet, no kids, got the time, has the energy. You know, we’ve all been there, right? Remember up till 2, 3 a.m., coding away, you know. Um now, if if the tech startup that I’m doing, if that fails in a year, we have like 12 to 18 months of runway. If that fails, I’ll probably kick myself a little bit for selling Superfly. But I I’ll know that that for that 12 to 18 months, I’m it’s just gonna be treading water. And I’m gonna feel like, oh, I got this thing that’s just treading water, and I’m spending four hours a week on it. And financially, it probably didn’t make sense to sell it because I would, you know, but with the time I’m not spending on it, I was making a lot more. But I just felt like it was best for that company to keep going to give it some fresh legs.

Jake Kramer 42:47

So but also you were so you were so specific. I’m giving you credit here, John, about your capacity. You know, you you took a hard zoom out and looked at all these things family, community, hobbies, uh, the people within the business, where you want to spend your time. So that was a huge factor in it, too, of just being like, man, I’ve grown all these businesses now. I I my quiver is full.

John Wooten 43:14

There was two, so there were two businesses that went as part of that sale. Superfly was the business number one, and then number two was this business called Brilliant Sight, which was a super niche website um for motivational speakers, pretty much. And it had it had a little bit of revenue too. And so we we packaged them together and sold both of them. And yeah, Jake, I watched uh an Alex Hermosy video where he was like, How big does your ego have to be for you to think that you can do three businesses well as someone else doing one? And I was like, Oh, I’m guilty of that. That’s me right there, you know. Dang it’s Alex.

Jake Kramer 43:46

Sometimes you have amazing points.

John Wooten 43:48

Now, fortunately, fortunately through Jake and the team, I’m able to step back from artillery. Um, I still do uh I still do some admin stuff. I do all I do some billing stuff and I Build the occasional site, but pretty rare. I might build maybe what, Jake, four or five sites a year now.

Jake Kramer 44:05

Yeah, but we plan for that, you know. Another point of like, it’s not like a surprise. You know, we we built that in our operating procedures from day one. We’re gonna get to this point so that John can keep doing what John’s great at creating, selling, building products, businesses.

John Wooten 44:23

And if those and if those other businesses can help artillery, you know, like Superfly was a great fit for that because it’s like whatever was missing in Divi that we wanted to build with artillery, I would build that product for Superfly. Um and then and and Jake was part of that too. We were building products in Superfly, and we were using them at the agency um just to fill the holes that Divi had.

Josh Hall 44:44

I know I know Jake only has a little more time with us here. So a couple last things I want to make sure we hit

Contracts, ARR, And Transfer Risk

Josh Hall 44:50

on. The biggest thing I want to make sure we don’t uh overlook contracts, especially with recurring revenue, because this is something that I’m seeing with some of the folks I’m overseeing who are either selling or acquiring is like if you buy a book of business and yeah, maybe there may be some good MRR, but there’s no contracts in place and they’re just month to month. And I know artillery, Jake, you mentioned this last time, last interview. It’s like, you know, is the likelihood that a lot of clients are gonna leave with the transfer? No. But technically, the you know, there’s MRR, but there may not be that much ARR, like annual recognized recurring revenue.

Jake Kramer 45:31

Um what do you think? You know, I well, Hans, first of all, you totally answer this because we might not be in a good spot. Um plus, you know, you’re married to someone who would know, so you probably know. Am I right? But anyway, our contracts, we we do do contracts, of course. Uh when we sign a new project and we put in there your monthly recurring price is $99 renewed every month, monthly. So there is a contract, but it’s but there’s just no like commitment.

Josh Hall 46:07

There’s no like commitment in like for a certain there’s no like a year annual commitment at least. Yeah.

John Wooten 46:12

I have a tough, I have a I have probably a tougher stance on this. I think ideally, like in theory, in theory, it’d be amazing for every client to sign a one-year contract on the hosting. And then if you go to sell, you get them all to sign another one to three year contract. I just don’t know how how possible that is. I just don’t know how many clients would actually do that. I mean, I think most of ours probably would if we asked them, Jake. Um, it just seems like a weird ask, you know.

Josh Hall 46:41

I I agree, I do agree with that. And honestly, like I feel like again, I think it’s very, very, very unlikely if a transfer is done with honesty and integrity and really good communication. And if you’re selling, you hand them off to somebody. Look, well, I’m the perfect example. When I sold in transit, I didn’t have any annual contracts. Eric technically took on more risk with that because yeah, you know, our we had over 70 websites, and yeah, they absolutely could have walked, but no one did, you know, right run the transfer.

John Wooten 47:16

So isn’t that what Daniel told you too, John, when he would they were looking for like uh buyers, a couple banks told him, yeah, it was tough on the financing side, tough on the finance for a seller or a buyer to get financing because you know, technically the bank said, hey, technically everyone could quit next month. You know, it’s the same uh you know, it’s it’s it’s it’s that’s the same reason why like MetaShare insurances can’t guarantee you, you know, coverage because every every person could quit the next month, even though it’s extremely unlikely. Um so yeah, that is that is something to to think about. Or you just find a bank that’s familiar with digital products and and have done these deals before, and they know it’s like when we bought the 30 sites um a year later, we had lost about 25% of them, which wasn’t too bad. Like I still would have done, I still would have done that deal exactly uh almost exactly the same. I wish I could have paid the guy maybe maybe two-thirds up front, and then the the other third a year later. But he he wanted to tip. He wanted all the money to buy crypto at the time. Wow.

Jake Kramer 48:26

You know, I know really timing by him, by the way.

Josh Hall 48:32

Before Hans kicks it off. I will say too, for folks who have uh a subscription model, that can actually be very uh uh intriguing, just because if you’re like if you have an 18-month subscription style web design service and you’re only a few months in and you sell, then you do have another you know 15 months of guaranteed revenue coming in for that client. True. Something to think about. Sorry, Hans. I I didn’t know.

Jake Kramer 48:58

And I’d be curious to hear how like a lot of I mean, just honestly, tech companies tackle this problem because you can’t sign a year contract with every single software as a service customer, especially if you’re B2C. There’s no way, it’s month to month. Netflix isn’t making me sign a year-long contract. So I’m curious if there’s an angle there.

John Wooten 49:18

You know what? That’s probably a good that’s probably that might be a smaller reason to why Dropbox used to do like two months free if you pay annually. Obviously, they wanted to lock you in and they wanted to inflush of cash right then. But maybe maybe one of the other reasons was you know, it’s another way to lock people in and have a little more value.

Josh Hall 49:36

And that would be after a sale, right? Because one thing we talked about in the last episode is like you got to be careful not to get annual payments because the money is already paid out. And so technically, like, you know, if I if I have everybody on annual and they’ve already paid, all the money’s already in my bank, uh a buyer, excuse me, is you know, there’s gonna be like no nothing there for them unless they renew for sure after the next cycle, or you have to pull all that money out of your bank account, which is good. Right, right.

John Wooten 50:07

Well, what we did was we pulled it out of the price of uh what we paid ever since the guy that we bought sites for, he he did just have a few clients sign a year thing like two months prior and pay him. And so I was like, hey, we’ll just knock that down off the price.

Josh Hall 50:19

Yeah, that’s good, that’s interesting.

Hans Skillrud 50:20

What were you gonna say, Hans? Um when you have a client pay you for uh a year up front for hosting, whether you sign a contract or not, you have a contract with them. You know, it’s it’s a verbal contract, but it is an agreement where I’ve paid you an annual fee, and in return you said you’re gonna do my hosting. So the fact that if that’s not written down on on paper, that’s risky, you know. And this is all because I’m married to an attorney now, I can think this way. Like I used to not think this way, but like when when someone pays you for a year hosting and you didn’t sign anything, there’s still an agreement there. So always keep that in mind. And and I just wanted to make one little note to um the the conversation from last interview. I was mentioning like when buying out an agency, do the do they have like annual contracts or something like that? Because if they do, that could be more of a selling point as a seller. But but yeah, also me as a person, I don’t really believe in that. I’m kind of like a month-to-month, and if you don’t like what you don’t see, like I don’t want to work with you for 11 more months. Like, I don’t, I’m not that type of person, but but could it make you more sellable? A hundred percent, because you have guaranteed revenue coming later on. If it and that’s what the point I was trying to get to. If you have something on paper where you’re guaranteed revenue in the future, that is an asset. That’s something you can sell in addition to your book of business, in addition to your SOPs and your staff and all those things.

Josh Hall 51:39

So it

IP Value Depends On The Buyer

Josh Hall 51:40

is funny though, like what was the big recent drama and acquisition with was it Liquid Web? So there was Stellar WP that had like Learn Dash, Vince Calendar, Content Restrict Pro, and a bunch of like big plugins, and then they got bought out by was it Liquid Web, and then that got sold, or maybe it was Liquid Web, then Stellar. I don’t know. You know, it’s like one of those like corporate conglomerate takeovers. But what was interesting is I did get like the email from Learn Dash saying, like, hey, upgrade the annual, save two months, right after the sale went through. So you know they were trying to get people to to go annually. Uh I hate to, you know, don’t mean to publicly call it out, but let’s just call it what it is. Like, that is something you’ll see when there’s like takeovers with e whether it’s in the WordPress prep plugin realm or whatever product it is, where they probably want to try to recoup as quickly as possible.

Hans Skillrud 52:36

Yeah. And also prior to sell, I’ve seen a lot of companies raise their prices right before selling because they’re wanting to juice their numbers uh to the buyer, um, you know, making their numbers look better. Um, so they you you see I very often see a price change, and then six months later, oh, we sold our business. Like, oh, how convenient. Um, so sneaky, the projected revenue, a lot bigger than yeah. That would be um there’s a point uh that was mentioned a little bit ago. I just want to at least share some quick thoughts on it. Where’s we’re talking about IP and uh processes and like selling that. And I wanted to give my two cents on it. You know, I think selling your IP is something that a particular buyer will find interesting, but others won’t. My example, I would not be interested in a seller’s IP unless it was very unique, very unique. Like in my mind, I was like, I just I want to acquire agencies that are kind of ready to enter the next chapter of their life. They don’t really want to do web design. I want to capture those people because I feel like I can get a good deal. And and with good deals, I’m hoping to pay them out, of course, and hopefully they walk away with more money and less stress than they ever would have. Um, but I’m also wanting to bring them into my processes. So I just wanted to note that like selling IP and processes, I agree it a hundred percent would work for the right seller. I think selling to another agency is less likely to happen. Um, versus like, hey, I’m really good at this niche, like local community niche, and I want to sell to this, you know, um nonprofit credit card processor that’s working with no local niches. Okay, that is they would want your processes a hundred percent. Um that would be they would pay a premium for that. So um, yeah, the mortgage you can do.

Josh Hall 54:13

You can just you can just say my courses are worthless, Han. It’s it’s okay. It’s all right. You can say the processes and my courses are worth nothing. Well, yeah, yeah.

John Wooten 54:22

The three sites that we bought, we just we just assimilated like the board. We just assimilated those clients into our process, right? Like, hey, that’s a good deal. You were used to emailing this owner, you’re not gonna do that anymore. You’re gonna go to the support portal, you’re gonna fill out a ticket. This is how we do things here.

Josh Hall 54:39

Where a process I think could be really valuable is if a buyer doesn’t do that service, but they’re agreed interested in taking it on. Because then it’s like you have my service, you have the book of clients, and you have our process, you can now offer it.

Jake Kramer 54:52

Yep. You know who would be a great buyer for artillery is the Alex Stapleton agency. They got the logo thing down, built to sell, you know.

Hans Skillrud 55:00

Nice.

Jake Kramer 55:00

Now you need the recurring revenue piece by artillery.

Hans Skillrud 55:03

You tack it on to your offering. That makes total sense.

Josh Hall 55:05

Well, that’s no, like legitimately, like a lot of like brand and graphic design agencies or marketing agencies that don’t really have a strong web design presence, but they want it. Absolutely. They get a bunch of websites, they get a bunch of clients, and they get the web design process with it. Heck yeah.

Jake Kramer 55:22

Besides having good pricing, uh is this the most important piece? Is just thinking about your leverage and finding the right buyer.

Hans Skillrud 55:30

It’s a big part, of course. You have to know what your weaknesses and strengths are, and then know what the buyers or the buyer’s weaknesses and strengths are. And that’s that’s the beauty of it. And I think we talked a lot about negotiation last time too, which is that like the like I shared my thoughts on the right model for buying an agency, but that was my model. There’s other models that people have when buying an agency. As Josh just shared, like processes are important to the right buyer, 1,000%. Also, for the record, processes are also one of those variables. I say you’re you’re once you become a real agency, it’s because you have processes in place. That’s another chapter you have to go through, period, to get to the next level. Um uh, but yeah, knowing I would love for you to expand further on that, Jake, but like 100% knowing your strengths and weaknesses and using that to your advantage when selling to the right person is absolutely critical.

John Wooten 56:20

Our weakness was WooCommerce.

Hans Skillrud 56:23

Yeah, oh my gosh.

John Wooten 56:24

I that’s what it was. So if you’re if you’re listening to this, you’re watching this, and you have sites, Divi sites that you want to sell that don’t have 40 plugins and don’t have WooCommerce, let’s say they got 12 to 20 plugins and they’re in Divi. Jake and I are buying sites.

Jake Kramer 56:39

So but alternatively, I alternatively, you know, if if we happened to be the WooCommerce pros regionally, oh my goodness, we would have eaten that up. Then we would have had processes in place already as that agency. We don’t to reach out to those people and say, hey, let’s clean this up. We noticed this. How about this? What let’s push this? What if we did this? You know what?

John Wooten 57:01

I have a referral for that for that for that student, Josh. I have a referral for them actually. There we go. Go talk to Nathan. Go talk to Nathan.

Josh Hall 57:09

I was gonna say, when we have a new member of Pro who does WooCommerce and does white label for other agencies. I’m like, you are going to clean up in here because you are seriously unicorn. Have it. You can have it.

Jake Kramer 57:21

He’s he’s taking out, he’s it’s like the guy who walks in and just I love wash, I love washing toilets. It’s my jam. Yeah, okay, cool. Wow, there’s a lot of work for you around here, man. Come on in.

Hans Skillrud 57:31

Yeah. So putting out privacy policies, like literally, no one wants to touch it, and we we started turning at it a little bit, you know.

Josh Hall 57:40

Like, um so true. Um, anything we did not cover, guys, here that once we end this call, I don’t want any of us to be like, God dang it. I wish Josh

Hidden Value In Licenses And Tools

Josh Hall 57:50

would have asked me this question. Anything that just needs to be out there.

Hans Skillrud 57:53

Yeah, I got a mini one. Like as a buyer, when you’re buying uh, you know, from a seller, of course. Um one thing that you can take advantage of is when you have overlapping licenses to things. I cannot tell you how many times a term of an agency partner gets bought out by an agency partner, and I’m transferring 15 licenses over to another partner who already had credits in their account. I’m like, dude, well done. Like, you’re not paying a dime more. This customer, you know, that we you got to cancel that subscription. So you just created another, you know, 300 bucks a year in revenue just from that, like one move. So take like one attractive thing can be like, oh wow, it’s not just the same things and stuff, but like the same plugins. Like I was Gravity Forms way back in the day, and like when I bought my the other agency, they had a Gravity Form on uh unlimited license. You know, at the time it was 250 bucks a year, it’s not going to make or break anything, but was it nice saving 250 bucks a year? Absolutely. So, like there’s a lot you can absorb into you know, into your current op um expenses, your current uh subscriptions.

Josh Hall 58:56

A great point, too. Like, if you’re a Divi business and you have lifetime access to Divi because it’s like stupidly cheap, it’s a terrible business model. I mean, Divi has more subscription options now for elegant themes, but uh you know, like you pay 250 for lifetime access versus you pay 250 a month for Webflow or whatever the you know your your plan is. That’s a lot more that’s a that’s a big difference when you’re selling it. If it’s like by the way, my business also comes with a subscription unless you already have that in place.

Hans Skillrud 59:26

100%. It’s a good one. My little takeaway. Okay, Jake go ahead. No, you John.

Jake Kramer 59:31

You go first, John.

John Wooten 59:32

Oh, I was just gonna say Jake and I are buying sites. We’re buying sites, Divi sites, non-woo commerce. Hit hit Josh up, let him know. He’ll set up the the meeting and we’ll work something out. Jake, go ahead.

Jake Kramer 59:44

That’s absolutely right. Yeah, the one thing I was gonna say is don’t forget, I guess my takeaway, don’t forget the emotional human piece of this. Most people sell their business because there’s some type of a personal thing happening. So that that piece needs to be highly considered. We talked about last episode how emotional that can be, stepping away. Think about that as you’re selling your business. Is your whole identity tied up in this? Think through that. Is it the right move? As John kind of talked about with Superfly, you know, John John’s been building that brand for years and years and years and years. He had a lot of blood, sweat, and tears into those designs and a lot of like authentic creation. And so stepping away from that was, you know, a long process. And then and yeah, the the numbers and books made sense, but also the time in his life had to really line up. And I think that’s an important piece to think about too.

John Wooten 1:00:40

We’ll see what happens. I might buy back in for a third time. We never know. Who knows what the future holds?

Josh Hall 1:00:46

That is that’s a good point. I I was, you know, we don’t need to take a whole thing on this, but I was kind of curious on your guys’ thoughts. Like, when is the right time to sell? Maybe we can end there. When when is the right time to sell? I can give my thoughts on that based off my experience, but curious what you guys think.

Jake Kramer 1:01:02

Gosh, I love John’s point. Like, am I so egotistical that I think I can do it all? That that piece really stuck out to me.

John Wooten 1:01:15

Yeah, I have a I have a certain time frame, you know, there’s a certain age range that I I want to, you know, between 55 and 60 is when I’d like to get out of my part of artillery. Jake’s 13 years younger than me. Maybe he’ll buy me out. Better start saving, pal.

Jake Kramer 1:01:31

No, we’re just gonna drive it into the ground when you’re done. I’m not paying you.

Hans Skillrud 1:01:39

I think um, you know, I I just hope that your decision to sell one day for anyone listening is not based on burnout. I think that we’ve I’ve just seen that so much. And I’ve I’ve had my phases when running my agency. And like when you do it not during a burnout phase, because when you’re burnout, you’re more desperate to just leave and you’re willing to sell at a lower price. Like, do it, you know, do it when you’re not burnt out and you like really are thinking clearly. Um, so it’s not really exactly when to sell. I that I don’t think I really defined it that well, but just don’t do it when you’re at your lowest low. Like, try to try to at least bounce up a little bit, find that a little bit of why you do this and everything like that, and then prepare more, you know, with a with a clearer head.

Josh Hall 1:02:20

That’s sage advice. That is wisdom there. Yeah, that was my thought. It was like yeah, really well said, Hans. Just well, just what you said. Yeah, don’t do it in like a period of desperation. Make sure you’re in a clear spot.

Jake Kramer 1:02:30

Yeah, step back, think about how you can build processes to stop that burnout, like other things that we talked about. Maybe you’re maybe you’re not setting boundaries, right? The parenting expert that we’re reading right now is like, to make a cake, you have to have boundaries, and that but you also have to have warmth, warmth and boundaries. Otherwise, the cake goes everywhere. Same thing. Or maybe that’s why the burnout’s happening. There’s not boundaries in place. Maybe your pricing’s wrong. Maybe you’re letting your clients control you. Maybe you’re focusing too much on the 20% when you should be focusing on the 80%. You can fire the 20%. A lot of things to be thinking there, but don’t sell your business when you’re desperate because you might get suckered. Yeah.

John Wooten 1:03:06

Yeah, such a great point. Or don’t worry about it and just sell to Jake and I. I want to update my ad. If you are have Diddy sites that you want to sell and they’re like 10 to 20 plugins, and you’re burnt out and you don’t want to deal with it, you’re at your lowest low, and you’re ready to get taken advantage of, come to Jake and I.

Jake Kramer 1:03:26

If it’s artillery or SSRIs, come on, choose artillery.

Wrap-Up And Next Steps

Josh Hall 1:03:31

That definitely should be on the uh acquisition page for sure. I I’m gonna definitely plug uh my original interview with Eric, my CEO, because we actually talked about this together back in episode 53 of the podcast. Uh kind of shares my entire experience with selling. So, anyone curious on that front, go back to that one. That was episode 53, uh, which gets into our sales product or you know, what I learned in selling. So, all right, gents. What a blast! This was a very fast hour. Thank you guys so much for your wisdom, experience, thoughts. Um, this is super cool. I’m Alex’s crew.

Jake Kramer 1:04:08

We’ll have to meet it all in person someday. Oh, that’d be great.

Josh Hall 1:04:11

Let’s do it. Well, Jake and John, ProCon 2027. Once we get the date solidified, I’ll let you guys know. Yep.

Jake Kramer 1:04:19

That’s that’d be fun, man. And Hans, I’ll be reaching out to you. I want to keep this relationship going. It’s great to chatting with you.

Josh Hall 1:04:25

Yeah, is Hans coming on your guys’ podcast? Because I want to listen to that one.

Jake Kramer 1:04:28

All right, since you asked and you and you plugged it, Hans, you’re gonna come on the slow and steady pod. Let’s do it. Tell your story how you built the business slow and steady.

Hans Skillrud 1:04:37

No, I would love to do share that. That’d be great. So we know thanks, guys.

Josh Hall 1:04:41

Appreciate it. And there we have it, my friends. Hope you enjoyed this one. For the show notes and all the links mentioned, go to joshhall.co slash 433. And if you did not get a chance to listen to the former episode, I highly recommend it. I think it’s good to think about both buying and selling a business from both sides of the corn. Uh corn, the coin, when it comes. We just had July 4th around here, so it’s on the mind. But uh wanted to make sure you check out both episodes because it really is important, I think, to view both selling and buying and acquiring from both sides. So make sure you check both of these episodes out. The former one was episode 432. This one is episode 433. Go to joshhall.co slash 433 for all the links on this one. And again, if you’re catching this on the week that it comes out, make sure to jump into the STO sales called Bootcamp, which is going on live through the whole month of July 2026, joshhall.co slash LSA to get access to that bootcamp inside of local STO Academy. All right, my friends, cannot wait to hear from you on if this helped you out, either one of these conversations. And if you like this little two-part series idea, let me know. Because I think we could do some of these moving forward that are digging deep into certain topics and maybe inviting some of my colleagues to have expertise. So if you like either one of these episodes, drop us a comment on the show notes for both of these episodes, 432 and 433. Those links will be below. And again, my friends, cheers to maybe selling your business in the very near future or far out if you want to join Wimb Designer Pro and get my personal help with you making sure your business is as sellable as possible. Thanks so much for joining my friends. I hope you enjoyed this fun week on the podcast, and we will see you on the next one because we’ve got some doozies ahead this summer, and we are gonna have a lot of fun too. So I will catch you on the next episode. Stay subscribed, let’s have some fun together, make some good money, help a lot of people, help our clients, and have fun doing this. Sounds good, right? Alright, my friends, buying or selling, it’s a load of fun, and I hope these episodes helped you out. Cheers.