Surviving Bad Clients and Bad Partners

[Music] hello everyone welcome to the 21 hats podcast I'm your host Lauren Feldman this week sha busy and Paul DS talk about what they've learned from their worst client experiences Sean for example tells us that he's come to think about taking on a client much the way he thinks about hiring an employee and Paul stresses the importance of watching what he says about difficult clients to his employees because he doesn't want to encourage a cynical attitude from Bad clients our conver ation shifts to bad Partnerships even though their own Partnerships ended poorly both Sean and Paul emphasize that having a partner can be invaluable in getting a business off the ground in fact Paul says he might even consider taking on a partner again plus both Sean and Paul explain why all the talk of recession is not giving them second thoughts about their ambitious marketing plans even in Good Times owning and running a business can be a lonely Pursuit our hope is that these weekly conversations will let owners know they are not alone in facing challenges same thing with our daily newsletter the 21 hats Morning Report which in magazine recently named the best newsletter for business owners and which you can subscribe to at 21h hats.com where you can also find transcripts of our podcast episodes and lots of other articles and interviews joining me this week on the podcast are regulars Sean busy CEO of Kinesis which is based in Portland Oregon and works with small businesses on marketing culture and strategy and Paul DS who is CEO of Paul DS cabinet makers which is based outside of Philadelphia and makes custom conference tables the episode is titled surviving bad clients and bad Partners welcome Sean and Paul it's great to have you guys here how you doing what's going on Paul it's hot how is it well it's going to be like a 100 today and my shop floor is not air conditioned and the people are out there working hard and it's just hard we do let them take breaks whenever they want oh that's [Music] good well that doesn't happen in every place I'm sure you're right we have a fairly air conditioned office and they can come in and and be in here and get cold water but it's just not not much fun to be doing physical work on a day like today do you know how hot it gets on the floor or do you not want to know yeah mid90s I mean part of it is possibly self-inflicted we have these huge fans that we installed that blow a lot of air into the shop and if I was running the shop what I would do would be run them at night and turn them off in the morning and I've explained this to my people but they don't seem to really buy into that theory so they run it all day too and blow under a degree air right into the shop I've given up on trying to control that cuz I mean they're out there so they they get to live with it Paul you said if I were running the shop aren't you kind of running the shop no I am not kind of running the shop and interesting I have a shop manager who runs the shop and I don't believe in me running around trying to micromanage the team so I let him run the shop and then there's there's a lot of there's 20 some people out there I mean they can make decisions themselves about whether to have a fan on or not I don't think I need to get involved with that I've made my theories clear they've rejected them they're living with the results they get to stand there in the hot air it's not me so I'm I'm I no I'm not going to overrule them how you doing Sean we're doing all right yeah we we've had a heat wave here too but it's finally cooling off a little bit before another one yeah I don't have air conditioning in my shop either but it's got pretty good insulation and and I adhere to uh Paul's um strategy turn on the fan at night turn it off during the day it works it really does I I can be a testimonial for your team although they probably won't listen to me either I'll fly you in you can bark at them all day you'll see what happens which is nothing all right so today I want to talk about difficult clients I know you've both had experience in this area Paul I think you've had one in particular of late want to tell us about it well I'm going to tell you in in Broad terms I actually don't really want to focus on this particular person other than to say that I've done a lot of jobs and I've been in this business for a lot of years and one of the people on this client's team is without a doubt the single worst and most difficult person we've ever had to deal with a woman who won't make a decision when needed to make a decision and uh lies and pericat and and passes blame and it's been a real problem all the way through and I will back it off a little bit and say that if you do a thousand jobs one of them is going to be the best and one of them is going to be the worst and one of the things that I've noticed about the ones that are the worst is that they kind of drag you down with them so here we have a very difficult client who is kind of resisting our efforts to operate the way we operate and that's thrown us off our our game and then also a thousand jobs one's going to have good luck and one's going to have bad luck and I've noticed that there's a there's like a connection between bad clients bad decisions and bad luck so some things that have happened on this job that weren't a result of a decision by anybody just bad luck and it happened to land in this job because this one's already in the toilet and that I think is the most frustrating thing to deal with as a business owner when you're trying your best to get out of a bad situation and then some lightning strike happens that just makes everything worse and you're trying to explain to the client all the things you did but you can't really explain why the bad luck arrived you know just other than to say well okay so that happened I'll tell you what it was in this case one part of this job was a desk for a CEO and the desk had a piece of of marble as the top and this marble uh we were delivering the job and when we opened up the truck and we got to the mo to the job site the marble had just cracked in half $66,000 piece of stone and it would have been packed correctly we've moved marble hundreds of times you know we we there's no reason on Earth this thing should have broken in half but then when we opened up the truck and needed to pull it out and put it in his office oh we're sorry it's broken in half and like who could even who could expect that but I don't know Sean have you ever had that where something starts to go wrong and then it seems to attract even more bad luck and it just gets worse and you can't get out of it yeah I I mean you know it's sort of like in my world where you're like trying to build like a good example is like building a website is like this right where you've built hundreds of websites right and you know you got things figured out you have a process you do things and then something happens you know the Russians decide they want to put malare on the thing right as you're launching it yes there's some correlation between difficult clients and bad things happening to you I've seen it yeah and and the the opposite doesn't happen either you got bad clients and then there's never suddenly like you stumble on a on a box full of $100 bills or something while you're doing the delivery there's never good luck that comes along and saves you that never happens I mean there's good luck in a lot of ways and there's good clients who who can swing with the punches but when things go over the edge in my experience it just it's a disaster Paul can you give us a better sense of what would make the worst job of all that you've done or the worst client of all that you've had and and and how do you try to deal with it we try to identify people who we think need extra attention as early as possible in the process it's very unusual for us to to just reject a client before a sale like to say oh you're impossible go away like we just don't do that and in this case we went through a fairly long process with this client and then and we knew it was difficult and the things that we have done that contributed to the problems have mostly been the result of bad luck or trying to get ahead of decisions that needed to be made that the client would not make and we have you know like they want this stuff at the end of the day but there's somebody holding up the process and so we would Edge into making decisions that we would normally leave to a client and that caused problems and then this particular client also did something which I've never seen before which is we send samples out of finishes and and say here this is what it's going to be uh approve it don't approve it whatever and if you if you don't like any of them we'll make more well this client approved a sample of a very complicated and then when we delivered it she said oh I don't like this take it back and well wait you approved it so I just approved it because I wanted to see it I didn't I didn't really like it can you believe that oh oh jeez this happened after you delivered the finished product just to make this better this is the other half of the desk that that the top had cracked in half those two conversations happened within 10 minutes oh God I like how you started out saying I don't want to get into the specifics go man well the specifics are the best part the specifics are pretty bad in this case and then oh man oh man and and there just like tremendous expense involved in trying to to do this so that's that's my Horror Story and now I will say that the number of bad clients to the number of good clients is something like one to 900 we we deal with all kinds of people and a lot of them we never meet face to face and I would say the vast majority of our clients are wonderful to work with trying very hard to make a success of the project and one of the things that I find as a business owner that's really I have to constantly watch myself to not complain about the bad clients to the team and let that sort of poison the approach to people and get away from that trusting environment because yeah there are bad people but we have to go into every project with just like an open mind and a good attitude and this is going to be fine and these people are going to be good and all of the evidence suggests that's true but there's something about human nature which makes you want to [ __ ] about the worst people and just sort of spread that poison around and I believe that if the employees see the boss doing that then they start to get a more cynical attitude it becomes a Cancer and it's really easy to Let It Go because as a business owner you understand not only just the frustration of the situation but you understand what it's costing you too and it's really hard to not let it fly and you know when you've reached your limit uh and you can't explain it to the wife and kids the people who are in the in the shop with you know everything that's going on they understand but I still have to keep myself from going overboard on complaints because I don't want to poison the atmosphere I don't know Sean have you ever run into anything like that I think that's really good advice you know cuz you you lose a lot of sleep as an owner when you run into these situations as I've gotten older these situations happen less and less and less and and I think part of that is a function of as you get better at like you said you you know you you identify clients early on that need more handholding or more help or or are more risky I think that's part of that's one of those intangible values of a more experienced business owner is seeing that earlier and not being surprised by it Paul you said that there were some red flags that this was going to be a difficult client what would you do differently if you had it to do over I would keep my team from trying to get ahead of the decisions that the client should have made that that was the thing that that was self-inflicted that caused certain problems you made those decisions because you wanted to keep the uh job moving along but I mean didn't make the the decisions I'm talking about this was Project managers saying okay they're going to they're going to choose this or that let's just let's just get started on it and one of the things that we did actually a few years ago not in response to this client but we started to really formalize the idea that certain certain jobs need what we call enhanced review and so in our Erp software where you're looking at the whole list of jobs there's several that are very clearly flagged as enhanced review and then right next to that little flag there's a notes thing that says what the problem might be and sometimes the client is fine and it's just that it's a situation where there needs to be like it's technically difficult or it's something new or you know whatever and we can just put that in there as enhanced review and sometimes it's a straightforward warning this client is trouble you know make sure that that everything is perfect don't send you know like just be on your guard at all moments we have another one that we're doing right now where the client is troublesome and we've sort of made that clear to the team part of it is how big is the job so that the current Troublesome guy is a $10,000 job so like if worse came to worse I would just hand them all this money back and say here go away uh the previous one the one I started off talking about it's about $120,000 job so it's a big job you know we wanted to do it but then there's also more Financial Risk I can't get out of it so easily you couldn't get out of it because you've purchased materials or did you have a deposit what we got a deposit I've been paid about 40 Grand of the of the hundred some I mean there's a lot more to the story that I don't want to go into but but collecting on that is going to be a project too given the way things have gone I can't just ignore it it's too much Paul you know you talk about like this enhanced review do you adjust your price when you run into these situations no possibly the the guys who are setting the price on the individual items we sell the two design Engineers uh have two incentives one they get a commission on on what they sell so they want to raise the price as much as possible but they also don't want to lose jobs so that they they have a sense of when they can push it and when not this particular client wasn't what I would call Price sensitive given what they were paying for uh the things we're making CU we we it was complex stuff and it was expensive but it's not like someone who would say like oh I'm going to buy a car and I would never consider anything past a Chevrolet like this guy would buy a Lamborghini if he felt like it and so that's part of the equation but I we don't go into pricing we don't do trouble pricing unless we want someone seriously to go away immediately like then then you can have a budget discussion right at the beginning and get them to go away if you feel like it just like I don't run the shop floor I don't actually do that day by day if my guys ask me like hey what do you think we should do here I'll certainly chime in but I try to give them responsibility to make those decisions themselves do you think there was a point where you should have walked away from this client it really it can't happen it's too much money uh we haven't covered ourselves in glory so far and we just got to get out of it we got to get done I mean I I've been waiting to book this Revenue now for almost a year year and we've put a lot of work into it and I want to get it done and so I can book it as AC crude revenue and uh and then it'll help me with my overall Revenue goals so there's no real easy way to get out of this one sometimes jobs Lauren the person you're selling to there's there consequences Way Beyond the job itself so you know there can be a situation where like oh I could just make this go away by refunding him or her their money but that generally creates a sense of negative um well non- Goodwill I guess and and so that they can be an influential person and you know so these things can be really really complicated at least that's been my experience yeah in general I think you got to keep your karma Bank full by making every effort to to always do the right thing if we make mistakes we own it you know like they they clustered around this job but there were things that we could have done different ly that would have saved me some money but we did those things so I just got to you know he asked for furniture at the end of the day we got to give him furniture that that he's going to be happy with otherwise then it's on me I've Had The Good Fortune to have jobs go really well and I made a ton of money and uh the flip side has to be expected you're just going to going to take a few in the face now and then so you know you you've been generous in acknowledging that you haven't done everything perfectly on this job and that you know it sounds like if you if you could do one thing differently you wouldn't make decisions for the client and move the project along before they they were ready that just makes me wonder if the if the same situation were to happen again maybe this client wouldn't turn out to be the client you consider the worst you've ever had is it possible no this one woman is is just like a like a grenade in the middle of the whole project I see she presented a huge level of difficulty no matter what we did we could have executed perfectly it still would have been difficult because of her did you try to get away get away from dealing with her at the end of the day after nearly a year and a lot of trouble I reached out to her boss and I said listen I need to get this done you don't have the stuff you ordered you and I uh have got to deal with this you and me and I can't have this woman in the middle of this so please leave her out of it and that got the ball moving again that was not much fun like I don't I don't I I mean I don't know what the relationship is between her and him whether it's a good relationship or a bad relationship or a personal relationship or a work relationship there's no way for me to tell what's going on there and but to have to ask someone to to not have someone in their team who they designated to run this project run the project like that can't have been welcome news but it did get the ball moving again Paul Sean mentioned the reputational aspect of this do you worry about people in a situation like this leaving bad online reviews somewhere or sure why why wouldn't I I I mean we live in a world where someone can crap all over you anytime they feel like it now we have a a strong record of success and I can pull out all kinds of other uh other evidence that we basically know what we're doing I actually knew a manufacturer who said to me one day that if you don't have 5% of your customers complaining about quality you're actually spending too much on manufacturing that's an interesting philosophy well his company was consumer oriented and he grew it very fast and and he did a reasonable job for most of his clients and I think that part of his thinking was that if you're dealing with 100,000 people a year some of them are going to leave a bad review no matter what you do so why Chase Perfection when it there is a serious cost to that you're just not going to be perfect and even if you were some people wouldn't believe it anyway so that's a point of view I I don't I don't ascribe to that because we're not that kind of business but like does every meal that McDonald's make is it perfect no and uh do they live with getting slammed and reviews sure and I think that every business owner just has to make a decision about that what's appropriate for their for their own situation Sean is there anything in particular you've learned through the years dealing with bad clients you said that as you've gotten older it's a less frequent occurrence why do you think that is I mean you know our business relationships with clients are long the especially the really good ones you know we have clients that have worked with us for a decade I treat client selection a lot like hiring an employee it's pretty rigorous in terms of wanting to get to know them really well trying to understand if the problems they have are problems we can actually solve or if they're realistic about what those problems are so I do a lot of vetting in the sales process to make sure that you know I think that they can go the distance and that so that's changed right in your early days when you're hungry and you don't really know how to discern good from bad clients you just sort of take anybody and everybody who has a checkbook and then over time you start to see the consequence of that just like with employees you know you're like eager to hire you hire the first guy that walks in the door and then like he creates Mayhem throughout the organization you're like oh [ __ ] I've never doing that again you just get better I think you get better at that um and since we're a service company I have some I have a lot more flexibility with that than say maybe somebody who's selling e-commerce or sells products um I also don't have an external you know uh investor telling me you've got to grow by a certain amount and you have to get this many new customers so I have more flexibility there that's I think a big lesson in um over the time of like selling to write customers instead of just any customer did you have that pressure earlier on where there was somebody else who was driving you towards no but I I have I have seen businesses that have that Dynamic you know and and and I see it both in terms of the decisions they make in terms of customers that they accept and I also see it in terms of the decisions they make just in general you know they tend to be more short-term more visible results oriented versus you're doing something to today that pays off in 3 years and and so I just I'm really fortunate in that regard and I I don't ever want to be in that position where I would have to accept a customer that I knew would be harmful to the organization because I want to produce some sort of financial metric so that's that's that's pretty meaningful I'd also say like to Paul's point about his his uh trouble client flag I think process can really help mitigate things so as an example we built a process where you know I'll do the sales I'll often do the sales with a partner in in that process my my director of strategy these days we'll do it together it'll typically end up where we're not servicing the client so we have a little flag that after a certain period of time one of us reaches out to the client and and takes them out to lunch just has a meaningful conversation say hey how are things going you know are you happy with the way things are working out and that honestly has been a real game Cher because you know the client and how they interact with the team is one way but you kind of coming from outside of that process to ask if they're getting what they thought they were going to get if there's things we can do to improve that's pretty meaningful and I think that that that process kind of like Paul's flag has improved that a lot it's allowed us to kind of get ahead of things and it's also helped us see when you know actually I don't think this client's going to go the distance so let's figure out a way to make sure they have a great experience and that when they say goodbye we're saying goodbye and everybody's happy um so that those have been some some meaningful changes that we've made well so long as we're talking about difficult relationships uh it just so happens you've both had uh interesting experiences with Partners in your businesses um and I'd love to explore that too from the same perspective of you know what did you learn going through that that other might learn from Sean could you tell us a little bit about your partnership experience yeah sure I I mean I've had a number of Partners I started the business at the age of 28 so I didn't know really what I was doing I had no experience in business I went to Art School two art schools so like I was really good at making art so you know I was pretty insecure in terms of like what I what I what it took to run a business so you know I had one partner who was much more experienced and so I kind of leaned on her but I didn't really ask questions of like do I like this person or you know do we have the same values or do we want to create the same thing for the company how did you come to be partners with this person you know so my girlfriend at the time had been doing business with this this other person as consultants and so the three of us yeah there's another one like starting a business with a romantic partner um so I had a romantic partner and then I had a third partner who I didn't really know very well and the three of us started this thing and what could go wrong what could go wrong yeah like we had no predetermined agreements we didn't do the calculation of like well this is what I bring to the table and this is what you bring to the table and this is what this is valued at and this is what your duties will be and my duties it was just like let's try to run a business it's going to be great you know like so many people do yeah and after about 2 years she decided she didn't want to be in it anymore that was my first buyout super contentious had to hire a mediator ridiculous because the business was worth nothing and you know we fought a lot over it so so so so stupid so so then I was down to one partner the Romantic partner the Romantic partner we broke up uh we broke up in the middle of of the negotiation with the other partner so super messy so messy but it was kind of funny it's sort of like adversity brings people together so even though our romantic partnership was ending we were both so pissed at our other partner that we we were like we're going to make this work and so so we did and actually you know we stayed business partners for another I don't know 15 years or so wow and for about I don't know 12 of those 15 years it was pretty good um and then it was terrible so yeah I can get into that if you want I well tell me this you know there are a lot of people who give advice just don't ever have a partner it's a mistake it never works and that's easy to say but you know there are a lot of 28-year-old people who know art out there who want to start a business and you know Partnerships sometimes do make sense I think and I'm curious if you had it to do over do you now know what you could have done differently that would have made a difference yeah I mean the first thing I think it's really important to recognize that getting the wheels off the ground is the hardest part of business in the early days you know like getting those first customers and learning how to run the thing and I don't know if I could have done that without that more experienced partner she had clients who paid us money you know like that's like a big deal and so as much as that was frustrating and tumultuous there there is a really interesting study that I found back in 2012 that looked at like about 5,000 small businesses and compared them across a couple of lots of different dimensions but one of the dimensions that was really interesting is Partnerships and and on on in general those kind of early stage businesses did better when there were Partners than the ones that were run by themselves and yet at the same time like I've worked with a lot of businesses and I've seen almost all Partnerships dissolve um you know so I think there's a weird Paradox to where if you have a partner in the early days it's actually tremendously beneficial especially because a good partnership you offset each other's weaknesses you know for example like I was good at the creative stuff I was good at the vision stuff but I wasn't necessarily good at at that time at selling and and to have those sort of um complimentary skills is like ridiculously advantageous especially if you don't have outside money to kind of build infrastructure if you're bootstrapping it it makes a difference well if you do have outside money that's another partner another partnership that can go bad yeah that's true but but I think what happens over time is that as the business matures and changes does that partnership evolve and change to fit that you know kind of new state and and that's what happened for us is is 17 years into the business or so it was like wow this is a different business today and and we're not aligned and you want something different than I want and you aren't willing to kind of you know do the things that are necessary for the business and so then you get into ego and oh yeah so if you had had a good agreement in place that gave a you know a set way to resolve um you know an unresolvable difference and allow to go your separate ways would that have solved the problem I don't know you know we had a shitty agreement cuz we had a shitty lawyer um what made it a bad agreement it was totally unclear like there was no like well what happens if a partner stops performing right which was the problem I was having right I had a business partner who was becoming more and more disengaged and you know from a Just Pure Performance perspective wasn't holding up her end of the deal and so what do you do you know like you're 50/50 I as the CEO would say to her hey look the metric show this isn't working would you like to become a shareholder and we hire somebody or you know do you want to change your job you know like but at the end of the day you have equal power and and so the the shitty shareholder agreement had no way to resolve that other than breaking up the company and in hindsight that shitty shareholder agreement was awesome for me like really good why is that because I had built all of the employee relationships I had hired everybody I was coaching everybody I was in the trenches with the entire team they knew the business as me and also I had sold every single client and so the customers knew me the employees knew me and so I you know essentially made it so that I could be like all right let's dissolve the company and then I'll just start a new one and I don't have to pay you anything and you know that's not my way of rolling in the world I I do believe Karma matters um but to have that kind of Leverage was crazy You could argue well I did all the [ __ ] work I I'm starting to swear because I'm pretty emotional about this but um yeah in hindsight I'm I'm really glad the shareholder agreement didn't have a provision that would calculate valuation and force payments or shotgun Clauses because at the end of the day uh it was better for me to be able to just break it up and go my way because I could build it again Paul you talked about your experience with your partner previously here and and you wrote about it at the New York Times as well could you just give us a a quick recap of what happened with you okay uh yeah so I had been in business let's see ' 86 to 2002 whatever that is 16 years um before I was approached by one of my clients uh someone I had just done a job for and he had recently sold out of a manufacturing business he owned and he was in his early 60s at that point he was looking for something to keep himself occupied and he liked the way I had done the job for him and he liked me and I liked him too he's a good guy liked his wife and uh he made an offer to buy into the company I was 40 I was looking at all the things that I had not been able to accomplish because I just didn't have the skills and the experience and the network to do it and it seemed like this was an opportunity to sort of get me out of my rut and to get the company to the next level and it turned out that that is what happened although it was not an easy path because we we had in mind to grow the existing business that I was in which was making residential furniture and shortly after the partnership uh started we we had we had this opportunity to make border room tables dropped in our lap by Google and the business just became a different business and in general his ideas on how to run a business were very uh I would say not a good fit for how I wanted to run it but I didn't really know any better like here's an older guy with money manufacturing experience and I was just listening to him cuz I didn't have any other source of advice at the at the moment and I had not hadn't really figured out that you can get all kinds of free advice on the internet I just wasn't we we just weren't there in 2002 so it seemed like a good chance for me to get to a place that I wasn't getting on my own and uh I talked with him extensively and talked to his kids and talked to other people and I got the standard advice to don't do it don't ever take a partner you'll regret it and I ignored that and even though we had a lot of bumps in the road and we ended up dissolving the partnership in 2010 I'm not at all sorry I did it because it did put me in a different place and he did bring a different set of resources and different point of view to the operation we were able to get to the next level and then we got stuck there but that's a different story we ran into the recession we ran to all kinds of things but I would not be where I am today without Larry balance help and I will say this for him that I was very fortunate that he was just a a really solid good person and that when we had troubles we didn't let it get out of hand and get too personal and there was a moment when he was set to lose quite a large amount of money and uh decided that he was just going to take that shot and not bankrupt the company and and sort of destroy my life because he was well aware of the entanglement I have between my business and my personal issues and an autistic son he just is like I don't want to put this guy on the street I could do it but you know what's the point and he just backed off at that point took his loss and got out of the business so I was very very fortunate that I had a solid sensible person with a with a wide streak of humanity and would I take a partner again today I probably would with the again I'm sort of at a place where I'm kind of done everything I can do with this business and I feel like it would really be a good thing to have an injection of energy and money and and just more different kind of expertise than I have I think that if you if you're thinking about oh I want to take a partner just make a list of all the things that the business needs and then how many honestly that you are good at and how many that you aren't good at that the partner is good at and then the basic question is this a decent honest person I can get along with that's pretty important too to me that's the number one thing if if you have strong values alignment like to Paul's example you can weather the difficult times if you don't then those difficult times are just going to be the you know the Tipping Point that just throws you over the edge um one of the things I've noticed that's interesting is that some of the best partnership clients we've had have actually been married couples which is really interesting because you think wow you spend your day working together and your nights living together and that's a lot of time I'll add that my my partner was a big part of the appeal was that in his previous businesses his wife had worked with him in the business and he was sort of the big idea big personality friendly leader type and she was a a certified public accountant and she was to get down and dirty in the details and make it work type and they had been very successful together and I think I've told this before but what happened is after we formed the partnership and I was working actually closely with the wife she came in and sort of started to clean up my books and show me how to keep them and B and then she died oh she died in her sleep about a month after we started working together and it was a huge shock to everybody really unfortunate situation she was like 54 years old she just had a heart and wake up I think you've given her uh a lot of credit for you know in that short period of time being tremendously helpful in terms of setting up your processes well she started me on the right Road and then what happened subsequent to that and this is this is not a general lesson for anybody because like so many business things it's just particular to the situation what happened after that was my partner got his daughter to come and work in my company she had been living across the country and he wanted her back in Philadelphia to sort of help him through this this terrible shock and she came and she started working for me and she turned out to be just a tremendously capable person who contributed enormous value to my company and I really liked her I will say that one of the biggest things about having a partner having not had one for 16 years was just that there was somebody else at my level in the in the in the building that I could talk to about uh just what was going on and and be dealing with not just an employee not just someone who I can hire and fire cuz she had I mean she was technically an employee but this is obviously a different status but just someone who was willing to think at the level I was thinking and she she wrote our whole Erp system that we still use today and she was just it was such a breath of fresh air to have someone dayto day that I enjoyed being with that was at my level intellectually and had goals for the business and we've maintained a good relationship as fact I had her over for dinner a couple weeks ago and it was just great you know I just really I wish she worked for me for with me again but uh uh it didn't work out that way her father your partner passed away eventually right he passed away 2 or 3 years ago and we would see each other every now and then but I think the most valuable thing to me was getting me to the next level but just having someone to share the burden with someone it's having a partner just like in my life having a wife has been a tremendous thing because challenges have come along and the two of us deal with it as a team and I never had that in the business till I had a partner and I don't really have that right now and uh and I miss it because I like having someone you know just that feeling that you're not alone dealing with all the challenges that's what we're here for Paul well you're good but you're not it's not quite the same it's it's okay but it's not not as good were you and your partner 5050 Partners yes and we had the same deal sounds like with Shan where neither of us could we had to agree neither of us could outvote the other and that worked until a couple of moments when it didn't work but at the end of the day we we figured out a way around it was that the right way to do it do you think 50/50 it was right for me at the time uh I think that it can go wrong in a million ways and I think that's probably true of any partnership structure that if the partners don't want to be partners it's nothing is going to be nothing's going to work but yeah it left me exposed to things that Larry did not he didn't choose to go down every road he could have and uh and I'm very fortunate about that if you had it to do over are there things you would want in that agreement that you didn't have probably yeah anything you could mention that would be work as advice for somebody contemplating a partnership now no a it was was a long time ago and I I don't even know what's in the agreement frankly sure but um B I think that my experience was again one I wouldn't want to hold up as a model for anybody other than to say that you you shouldn't reject the idea of a partner out of hand that would be my takeaway I think the number one mistake folks make is they confuse uh being a shareholder with being an an employee in the company and you know I think that you know in my case I had a partner who for many years was very engaged in the work and actually did a lot of great things to help us grow and then what happened is is fundamentally just like employees right some employees are amazing for years and then they start to lose the passion for the work or their priorities shift or maybe something happens to them right they have a Health crisis whatever and they are no longer as valuable as they once were and when they're an employee you can you know work towards increasing their performance you can coach them and you can also let them go right you can say hey it doesn't seem like you're in it to win it anymore your performance is flagging here's the metrics that show this it's time for us to part ways the problem when you have a partner who's performing a role in the company is if that starts to happen and so this gets to the agreement part if you don't have a strong values alignment and you don't have a a course of action for when that problem happens that's when you get into the really nasty areas that's at least that's what I've observed all right we are just about out of time uh one more thing I wanted to ask you both about you have both talked openly uh recently about rethinking your marketing and I guess I'm especially curious about this we're now at this moment with the economy where things are no nobody quite knows what to make of it is the macroeconomic situation having any impact at all on your marketing thoughts Paul how about you uh no I I've always done well by going on offense when everybody else is shrinking back and uh in 2009 I made a significant investment in upgrading my website and we are sort of in the beginning of this process of of a targeted marketing effort and I I'm going to continue it because when the going gets tough there's still work out there and it's just question of going and getting it well I got to stop you there you I didn't realize you upgraded your website in 2009 and it surprises me because I think that was also the year that you reached out to me and asked me if I would be interested in having you write about what it was like for your business going through bankruptcy which fortunately didn't actually happen well there you go do you connect those dots is that right I do yeah I I I do I do because what happened was you know you're in you're you're coming through the beginning of 2009 and it's pretty clear that the disaster has arrived and what do you do and our existing website at that time was not SEO friendly and I thought okay if we're going to get through this it's going to be because people find me on Google there were a lot of things I didn't like about site and uh and I was just like okay I got to do it I've told the story is taking the kids college fund it's actually worse than that we received a settlement from the local school board in response to a suit having to do with my autistic son's education and that money was intended to be used for to reimburse us for some private school tuition we paid for a couple years so I took that money I took money out of the hands of my disabled child and blew it on a website but it saved the day that was just like one of those things like where am I going to find where am I going to find 30,000 bucks well it's sitting right there I just got to just got to pretend it worked right thanks kiddo it did work yep and uh and I mean I I think we're in the same thing like if you if it when times get tough if you just shrink your head and and and hope it's going to blow over how are how are the customers that are left going to find you and so I I believe in counterattacking when I mean I've been through enough recessions now you don't just sit around and wait to die that's my feeling do something so I'm going full speed ahead with my marketing how about you Sean is the macroeconomic situation have any impact on your thinking I'm in puls booat on this one you you just can't stop you know like just because the headlines are bad or you know I I just I don't believe in this kind of retreat um mentality I mean I'm about to write several really large checks for our um small business conference in November you know and there's all kinds of uncertainty right you know it's like oh CO's still a thing and you know oh the economy and wars and Terror and Taiwan blah blah blah blah but I'm just like yeah we're going to go ahead and we're going to push hard and you're planning on redoing your website too right oh yeah we're going to scrap the [ __ ] thing I'm saring a lot today it's super frustrating um I yeah I we we made some bets uh going in well actually we didn't know the pandemic was coming we made some bets and the timing of those bets was just really bad but um you know you just I I wrote about this on LinkedIn the other day it was really short post it's like you know if it's crap say it and move on and you know make a new one so yeah that's where we're at spending a lot of money my thanks to Sean bu see and Paul Downs as always thanks for sharing wait wait don't leave yet if you have a question or a comment that you'd like the 21 hats owners to address send it to me by replying to your Morning Report or by email at Lauren at21 hats.com that's L ren21 hats.com do it now before you forget and don't be afraid to tell Jay what you really think he can take it and if you got something out of this conversation help us reach more business owners tell a friend subscribe and review us wherever you get your podcasts follow us on Twitter subscribe to the morning report at 21h hats.com this episode was produced by Jess dubron founder of blank word Productions okay now you can leave thanks for listening everyone 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