When Business Owners Burn Out

Hello, everyone. Welcome to the 21 Hats podcast. I'm your host, Lauren Feldman. This week, Sean Bussey and Jay Golts discuss a recent Business Journal report that a lot of business owners are feeling burned out. Why is that? And what can owners do to avoid it? And have either Sean or Jay been there? Plus, Sean brings us up to date on the leadership transition he's initiated. And believe it or not, Jay has had another revelation about ESOPs. Also, do business owners need better regulation or no regulation? And which regulations are annoying Sean and Jay the most right now? For Shawn, it's the nightmare of having employees in multiple states and having to figure out and comply with the various rules of each of those states. Even in good times, owning and running a business can be a lonely pursuit. Our hope is that these weekly conversations brought to you by our principal sponsor, the Great Game of Business, we'll let owners know they are not alone in facing challenges. Same thing with our daily newsletter, the 21 Hats Morning Report, which Inc magazine named the best newsletter for business owners and which you can subscribe to for free at 21 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 Bussey, CEO of Kinesis, which is based in Portland, Oregon, and works with small businesses on marketing, culture, and strategy, and Jay Goltz, who's CEO of the Gatz Group, whose companies in Chicago include a picture frame business, part frame service, and a home furnishing store, Jason Home. The episode is titled When Business Owners Burn Out. Welcome, Sean and Jay. It's great to have you here. I want to start today with a topic that's been in the news a good bit of late and that's burnout and how to deal with it. In a survey conducted by Walmart, 70% of business owners said they feel burned out at least once a month. Of course, The survey did not disclose how many of those owners attributed those feelings of burnout to having to compete with or sell to Walmart. It is an interesting starting point for our conversation, I think. Have either of you felt burned out as business owners? I have to tell you after reading it, um, the answers are right there. I don't think, I think that it's the wrong question. I don't think it's how do you deal with the burnout. It's how do you avoid the burnout? All of the core problems that are causing the burnout, they're not addressing, and they think it's inflation. They always think it's something else, it's out of their control. It's inflation, at the labor, no, it's, it's, that certainly hasn't made it easier, but the one guy says he's looking to clone himself. Well, there's a problem. Um, no, you don't have to clone yourself. You have to find someone who's competent to do one of the jobs that you do. If you clone yourself, that would be an entrepreneur. They don't need you. So, it always goes back to the same basic things, hiring, delegating, pricing things properly so you can afford to pay good people. And if you read all of these things, these are all the symptoms of not doing those things. But Jay, it took you a long time to get to that point. Yes, absolutely. In the past, did you feel burned out as you were finding your way? I don't know that burned out's the phrase. Certainly stressed out. I had 15 years of, of constant stress cause I didn't know what I was doing. I had no mentor. I've never had a boss. I think there's a difference between stressed out and burned out. I think everybody feels stressed from time to time. Burned out is like, I can't keep going, I think. No, never had it. No, I've managed to, I have like, I always compare it to a sump pump. It goes up, it goes up, and then boom, the thing clicks on and it just clears the deck. And then in the morning, I feel better. I've always been able to like reset the next morning and dig in again, maybe because I'm stupid and I'm stubborn. I just have always had the resolve. To just dig in. I've never said to myself, oh, I can't deal with this. Maybe I'll just, no, never even crossed my mind. I, that's one of my, uh, few course, uh, competencies, I think. I'm stubborn and have resolved. So no, I can't say I've had quote unquote burnout to where I actually thought, I can't do this anymore. How about you, Sean? You know, I had a conversation with a friend of mine the other day that I've known for a really long time, and we kind of started our businesses around the same time and sort of went through a very similar trajectory of, you know, discovery and learning and growth. You know, he's on his way out. He's, uh, he's gonna turn over the CEO role, I think January of next year. And he said to me, I just don't have another turnaround in me. And I've heard that a lot actually. I read this article and I was like, you know, I've had that feeling too. And, and I think that, you know, we've all gone through periods of in our business where we've we've had just really catastrophic events happen, you know, a key customer leaves or several customers leave all at once, or several employees leave all at once, and You know, I think the frequency of those events has increased a lot in the last, say, I don't know, 5 or 10 years. And I think that's, I think that's what I read in that survey, you know, it was like, OK, the pandemic, all right, we're going to survive that, and then it's inflation, and then it's, you know, massive turnover and just on and on and on on supply chain, on and on and on and on. And I, I do, I do hear that a lot from a lot of owners. I completely read that thing differently. First of all, you said catastrophic. Losing some key people is it's not catastrophic is finding out you're sick and you're gonna die. I don't know if it's difficult. OK, fair enough. But when I read this, this is what I see. This is the big line in there. 55% of small business owners surveyed identify in Inflation and rising costs is the biggest barrier to growing their business. I laughed out loud when I read this part, followed by lack of customers and finding and retaining good employees. Seriously, if I just had more business, I, I mean, at some point, you need to find out how do you get more business. And, and these are the same people who don't market, who don't advertise, who just keep doing. And the same thing over and over and over again. Of course, everybody would be better off with more business, but is that a new thing? Is that something that just happened? Jay, why are you assuming they don't market and don't advertise? I mean, I know many of them, and I've heard this story from 100 people. And when you ask the question, I have never had one person complaining about finding people when I say to them, Wait, wait, wait, stop for a second. Let me ask you a question. Did you write a really great ad and put it in a bunch of different places? And the answer is no. They complain about it, but like, I'm not saying it's not more difficult, trust me, it's more difficult to hire. I'm not arguing with that, but it's certainly not impossible. And I put an ad out for a graphic designer. I got 110 resumes. Some of them you say to yourself, why did you apply for this? You're a truck driver. OK, but went through 110, identified 7 good candidates, we called 7 of them, 2 called back. I have no explanation as to what happened to the other 5. So it's gotten more difficult, but I don't think this is all outside factors that are wearing people down. I believe from talking to hundreds of entrepreneurs, they never figured out how to hire people, good people. They never found out how to price properly. It's basic stuff, and I contend. If you work on the basic stuff in your business, it will get easier. I don't know, man. I, uh, I mean, I, I appreciate, you know, you've been at this longer than me. I mean, maybe you've got another decade or two on me, but I've been doing it 20 years and 20 plus, and I, I just gotta say the last 5 to 10 have been radically different than the prior 10 to 15. And what I mean by that is that the frequency of change and externalities has increased tenfold. Is it really tenfold? I mean, it's gotten worse in some ways, but is it really tenfold? I'm not saying, I'm not saying. I'm saying, I'm just saying change and volatility. So I'm not saying like it's gotten harder or that the situation has gotten worse. I'm saying that when, when I first got into business, I was told things like, Sean, you really need to have a 10 year plan. And like I look at that idea today and I'm like, you're freaking foolish to think it was always foolish, but what, where did that mindset come from? That mindset came from an era of Of much, much slower change of pace. And I contend that we are in an era of greater and greater volatility and change. And I think that humans really struggle with, with change. And, and that's what's in this survey. That to me, that's what I read. There's certainly part of that. I'm not arguing with that, but I would ask you, the person who told you you've got a fork, was that actually a small business owner? or was that some academic or someone from big business because You can't forecast 10 years in a small business. I, I don't know that that has changed. Yeah, I, I, I agree that was probably foolish for small businesses from the very beginning. You read that in, in, you know, yes, it's academic literature that's informed by corporate America and Wall Street. And, you know, small businesses inherit those ideas. But I, I think my, my point being here is that, while that was probably never a great idea for small businesses, the pace of change has radically changed. And I think that this, this type of article is a reflection of that. I mean, just take, for example, You know, the idea, like how hiring used to work, right? Hiring used to work in a way, like, I remember when I first went after jobs, it was, Sean, you are lucky to have a job here. Now, the, the mindset is massively different. You know, Employees are like, What's in it for me? What are you gonna do for me? And I don't know that they're wrong to say that, but that's a, that's a paradigm shift. This changed. There's no doubt about it, but with this in the same token though, I've hired some lovely, wonderful young people who come to work every day and work hard, so it's not 100% change. Yeah, it's, it's gotten harder. I'm not arguing with that. It's definitely gotten harder. And a lot of things are driven by baby boomers. The baby boomers are now old and retiring, and there's less people to hire possibly. There's, there have been some structural changes, and certainly, I don't know that any of us have recovered from 2008. I mean, I know my business never really did, and I, I, so I'm not saying it's not difficult out there. I'm just suggesting there are still some core basic things that people still aren't doing that would make their life easier. I, I'm sure that's true, Jay, but, you know, Sean started with the example of talking to another owner who said he's not sure he's got another turnaround in him. I, I don't know who Sean's talking about, so I don't know. if that was a well-run business that just has hit, uh, a difficult times. No, no, I'm not talking about that guy. I'm talking about the article. I'm just reading the article. Well, I don't want to just debate the merits of the article. Well, that is what I'm talking about though. I'm just talking about the fact that somebody would go, well, if I just had more customers, oh, for God's sakes, that's like, oh, I would go to the Olympics if I could just run faster. I, I mean, of course, we could all use more customers. What are you doing about it is the question. And when you ask people, and I've done it 100 times, they never tell you the right answer, like, I deal with vendors all day long and I just scratch my head at the fact that there's still people driving. Here's a perfect simple example. You call someone out to your house, whether it's a plumber or electric whatever. Half of them just have blank trucks and you say, why wouldn't you put a beautiful, you know, you see these beautiful trucks with the name on there so all your neighbors can see who's doing the work, and they don't want to do it. One guy once told me, well, I don't want to mark the trucks because then people call and complain about my guys's driving, which is pretty sad. If I hear you correctly, Jay, what I hear you saying is that you have to nail the fundamentals, and a lot of folks are not nailing the fundamentals. Yes, and that would take some of the pressure off. I agree. I, I 100% agree with that. Like, I think these two ideas support one another. So, for many years, I think owners could be totally lazy and shitty at hiring and their businesses did OK. And I think what's happened is the landscape has changed, and you can no longer be lazy and shitty at hiring. Um, I, I don't disagree with that. You could just show up. Yeah, right. And so today, because of, and the change that's happened that has made this a reality is the internet and transparency of, of work. Absolutely, I'm 100% with you. You used to not understand, like, well, what do other people make? What are working conditions like? Is this place a good place to work? You didn't know as a candidate what it would, you were just like grateful to have a job. And today, the power has changed dramatically. And so nailing the fundamentals back then meant you placed an ad for a job. Today, nailing the fundamentals means you need to have an employer brand, you need to have clear communication in the hiring process. You need to articulate your values and your mission and your purpose. You need to actually coach and elevate team members so they grow in the role. You need to get rid of toxic employees fast, you know, like, those things used to not even be part of the playbook. And today I don't disagree with you. You're right. But the internet has, has exposed when, when somebody used to not take care of a customer, maybe they told a few cus now that goes on the internet, everybody sees it. So, but here's where I laughed out loud. I just want you to think about the people who wrote the survey. They said, but just 6% of HR leaders cited employee burnout is a concern. That doesn't mean they don't, they're not concerned about it. What a surprise. Big corporate America, the HR people aren't concerned about their people burning out. Are they concerned about anything other than their own jobs? I don't know. I've never worked a big corporate America. I mean, that's, that's funny that that's only 6% that burnout is a concern. That doesn't mean that they don't know if there's a lot of burnout. They're just not concerned about it. Are you concerned about it? I'm concerned about it. Yeah, that was the last line in the article where it essentially cited that 70% of employees are burned out. I mean, it's 2/3 of the workforce is saying they're burned out, and then only 6% of HR leaders are actually saying that's something that they worry about. And I think you're right. I think they're surveying HR leaders within corporate America. I don't think they're surveying small business owners. That's what's funny about it. There's not concerned about it. Yeah. Because the fact is, people don't understand a lot of people. Unless you've got 100 employees, you probably don't have an HR manager. That's kind of the magic number, and I didn't. So, whenever you see an HR person speaking, it's almost always a larger company, would have to be because a company with 15 employees doesn't have an HR manager. Yeah, that's actually a good point in terms of data gathering. Sean, when you were talking about the other owner that you'd spoken with, you expressed some sympathy and indicated that you'd have that same sense from time to time or maybe once. I'm not sure. I don't want to put words in your mouth. Can you tell us what you were referring to? Yeah, I mean, I, I tried to list some examples of like what I call kind of like turnaround moments, but, but I think the ones that are, you know, in my mind, really significant in my career were at the beginning of my business, which was the tech meltdown in 2000, the bombing of the World Trade Center, the Great Recession of 2008, the beginning of the pandemic, like moments that were in many ways like Existential threats and crises to the business. Those are externalities. And then there are also like business level crises, like, oh my gosh, you know, something changed. A good example would be somebody who really relies on Google AdWords for all of their business. And then Google changes as an algorithm, and then suddenly the thing they use to get their business no longer works. Like that's an existential crisis, or Facebook. I mean, you have You know, some guests on here that have used Facebook to great effect, and then it no longer works for them. And are they able to reinvent the business? Are they able to actually do a massive change to the business to to save it, to literally save it? And You know, those are hard moves. Those are really hard moves. And I've done a number of them in my career. And you know what, I 100% agree with you, and you are in a far more volatile business than I am. Um, I certainly have had major drops like in 2008, but in your business, when business slows down, the first thing they're gonna cut is Maybe people do what you do. So I certainly understand that you're more vulnerable to the economy probably than I am to some degree, but, but it, it still gets back to, there's always a part of this of all we can do is what we can do. And there are always things you can do in your business, like if you're having a hard time hiring. Tunne up your hiring process. But I think if you were to follow up with many of these people, they haven't done anything. They just say, I can't find people. Really? You know, I'm finding people. It's harder, no question about it, but, well, you also have something that a lot of folks don't have, Jay, which is you have size. You know, and, and size buys you cushion, you know. Uh, only to a degree. I still have tremendous overhead because of that size. So it's very easy for me to go from making money to losing money. If a flick, you know, all you had to do is drop 5, 10% of sales and all of a sudden I went from making money to losing money. I just learned over the years, all I can is all I can do. And, and I'm always just trying to figure, OK, what can I do about this? So I'm trying to stay ahead of it. And we're writing better ads, we're, we're playing around with where to advertise. I really have no explanation as to why the 5 people didn't call back. It makes no sense to me. And I still haven't hired anyone. This has been going on for 2 months. Um, it's, it's, it's just remarkable. I mean, I, I think. I think this is a good example, like, kind of both right here, you know, where I tried for a really long time to kind of get into the construction industry as a client base. Like, we have expertise in that arena. I love buildings, you know, I wanted to help this group. I would go to their, you know, uh, events, and I would be a speaker. Folks would be super motivated. They'd be like, wow, that's really great. You know, you really showed us how it can make Make difference to create, you know, a culture that's strong and a hiring process that's great. And then some folks would say, hey, yeah, give me a call. I'd love to talk. And I would call them and they'd never call me back. You know, like, like, they would identify it's an issue, they complain about it, but they actually wouldn't change. You know, I have a phrase for that. I call it trade show talk. You're there, you're hyped up. No one's lying. They really mean it. Like they're all enthusiastic and they get back to work. Oh, yeah, I don't want to do that. No, I. I, the fact of the matter is, people don't do what they need to do. And I've, I've, I remember one guy in particular, I was doing a business speech and I said, you know what, one of our jobs as the boss is there are people who can't do the job. You've tried, you've coached them, you've done everything you can, whether they're unable, whether they're unwilling, or they're just unexplainable. You know, you, your job is to fire them. And this guy looks at me and he goes, Yeah, I've got this woman that's worked with me for years. I promoted her to be the, the office manager. She's doing a terrible job. She's killing me. So, coincidentally, I run into him, I don't know, 6 months or a year later at another conference. Oh, how did it go with that woman. He looks down in the shoes, yeah, I gotta do something about that. That's what my experience has been talking. People, I mean, and being in business groups, same thing, like, yeah, yeah, yeah, but do they actually go ahead and take action? I'm not saying everything's whining. It is difficult out there. So I, I certainly, it, it's absolutely more difficult, but there are some things we can do every single day, and we need to be doing that because we are flying the plane. We're not the passenger. We're flying the plane, make some adjustments, figure out what you're bad at. I've certainly got some issues I'm working on. You know, we've talked about my inventory problem. Yeah, I, I think it'll be OK by the end of the year, but I've still got issues I'm dealing with, but I just learned to deal with it. So, OK, so two things that I, I think might be a little bit helpful in this situation. So one revelation I had many years ago, and this is from the world of psychology, which is that if you remove the stressor, the stressor still remains. For a while. And I think that that survey is to some degree, a lagging indicator, and I think folks are looking to point at something. But I think a lot of owners were just worn out and beaten down by the pandemic. And today, they're still exhausted, even though the pandemic stressor has been removed. And so then let's be like, oh yeah, it must be inflation or supply, you know, like they're trying to point to something, but I, I, my theory of the case is that it's the exhaustion from the pandemic. The second thing, this is, this is like hugely helpful for me in terms of, of employees and burnout, which is that employees, they have kind of 3 things going on in their life, right? They have their, where they live, their community, their home life, their partnerships, their, you know, spouse, boyfriend, girlfriend, partner, whatever, and their job. And when something is not working or they're under stress, and they generally, humans like seek to change something, And a lot of times they can't change the first two things. They can't change their spouse, they can't change where they live. And so they'll change their job, even if the job isn't the source of the stress. They'll start to like look at it and go, I'm unhappy. It must be the job. I've seen people do this so many times. They'll be like, it must be the job. They go take a new job, and they're still unhappy. And, and I think that the last few years have been really hard on everybody and things outside of work. And so As a result, I think you got a lot of things like the great resignation, you get employee burnout, that isn't necessarily related to work, but it's the one thing that they can change. There's no question that though everything you said is true, it has gotten more difficult, and I certainly have had examples of that. My only point is, it's half that, and it's half fundamentals that we all need to be working on. And I would argue, even without the pandemic, have you never talked to a business owner that goes, Oh, you can't. people that want to work these days. Have you not heard that? I mean, like, you know, really, then you're doing something that's a different, you know what I've learned over the years, the difference between me and many people, especially in the picture frame business, I spent all of my time trying to figure out what am I doing wrong and what do I need to fix. And they don't spend any time on that. They just convince themselves they're doing everything right. And I, I, I don't know how you improve. You don't continually be your own worst critic. Sean, you talk to business owners all the time. Do they go through the process that Jay just described of asking, what am I doing wrong? Why is this not working? Yeah, I, I think the folks that become our clients are really open like that, and I would say they start from a position of curiosity. What can I do better? What can change? I mean, I had a client once where he bought the business from the founder, and their workers' comp insurance, they were about to become disqualified for workers' comp. They had so many workplace incidents. And the prior owners just looked at that and was like, well, you know, people just need to be more safe, you know. And then the new owners were like, you know, actually, I think we could, to Jay's point, we could implement some processes that help take this like, people just need to be more safe mindset out of it. And actually, we make the place becomes more safe. We like turn that thing around like crazy, and they're saving $1000 a year on workers' comp policy because they said, what are we, what do we need to change? What needs, what, what's what status quo is failing us? And, and I think like owners who do that, you know, they're the winners and, you know, I, those are the ones I like to work with. Keep in mind, Lauren, you asked a trick question you said of your clients. His clients are the ones that figured out we need to improve. It's the ones that didn't hire him that are the issue. Good point. So, uh, you know, the, the, yesterday, I went to a work site for this big building being built downtown that my son's involved in, and it's their opening of something, and it's a raw work site, like, you know, the rickety stairs, the construction elevator, everything. And my son's assistant came with, and there's a guy following, so I'm in charge of. Safety goes, the woman's wearing flip flops. I want you to imagine walking through a construction site with rickety stairs, and I said to her, this guy's in charge of safety. He should have never lied and she didn't disagree. I mean, they should have never let her walk around with flip flops, and he's in charge of safety. So like, someone's probably gonna get hurt there eventually, and it's not gonna be, uh, uh, it's accident, it's gonna be someone not doing their job. All right, next topic. Jay, a couple of weeks ago, I published a one on one podcast episode with you in which I said you'd concluded that an ESOP probably wasn't for you. You corrected me and said, an ESOP absolutely wasn't for you. Is that your final answer? Um, I listened to your podcast last week with you and Sean and Phil, the, the new ESOP guy. It's been more than a week now, but yeah. Also when I listened to it. And you know what, I realized I have PTSD from that seminar I went to with Sean, because I swear I don't. No, no. Sean, I went to this thing in Portland. I flew out there, and I don't think I could have choreographyed a worse day of explaining ESOPs from the fact that there were no seats left in the room. Sean had to sit in the back. And then you find out that the people in the best seats are the vendors to the slideshow, you can't read to the, there was supposed to be half an hour roundtable, they skipped it. So it was a really horrible presentation, turned me off. After listening to Phil, I realized, OK, I went to the wrong seminar, and there's another part. This is my real revelation. When you're 45 and you think about an ESOP, that's an option. When you're 67, it's a solution. Like, I need to do something, and I'm, I'm opening up my mind to, I'm gonna continue to look into it. I'm going to another seminar at a different place with a different group of people. And I'm gonna continue to look into that because even though it might be quote unquote, a pain at times that there's a lot of paperwork and there's trustees and all that. It just might be worth it at the end of the day. That's what I've, it just might be worth it. So, um, yes, I'm taking back the, it's absolutely not for me. It might be for me. I'm, I'm gonna work on it. Sean, it was your idea that we talked to Phil Hayes, uh, for that podcast. You had met him at the event that, um, that Jay described, and I got a lot of really positive feedback. So thank you for suggesting that. Sure. Yeah, that was a really great conversation. I, I didn't know exactly what to expect, but like a lot of things I do in life, I, I had a hunch, you know, I was like, I think, I think this guy is, is the, is the real deal, and, and what maybe owner operators are looking for. And I really appreciated his candor about whether you should be an ESO or not. I think he has a very kind of like, you know, it's not for everybody, but for some, it's great, and there's, and you don't have to make it super crazy. And I think, you know, there's another, you know, Jim Cobb, who's who's part of the 21 houses community. He's EOped his company. He's talked about his process and I think he's done it in a, in a way that didn't involve kind of like the industrial complex of ESOPs. So, so yeah, I, I think it was encouraging because I think it's showing that like there are other paths to doing it that don't involve, you know, Chase Bank. Um, I mean, it was, it was crazy, it was a crazy event. And I have to say, you know, we left after the first day. It was a two-day event. Sean, did anyone call you to follow up? No, the email automated me, of course. I have to tell you, if I put on a seminar and I had someone fly across the country and they left in the middle of it, I'd be pretty concerned and I'd follow up and go, hey, what do we do? Cause I, I, I don't get the feeling like anyone really cares. It's like they keep doing their shows, they keep getting some people on it. I, I, I, I'm not exaggerating when I tell you, I don't think they could have done a worse job with what they did. I, I have to say, um, since we've been having these conversations. I'm starting to hear more and more people use the term the ESOP industrial complex, and if I accomplish nothing else besides coining that phrase, I, I think I will have done something good on this in this world. It also doesn't mean that everyone involved in an industrial complex is bad. I did talk to another ESOP advisor. All they do is ESOPs. They're not an investment banker, and I was a very encouraging conversation. And I appreciated that Phil was honest on there. I've watched 33 seminars now. I have never seen one person who said, no, I take it back. There was one guy that, that said he sold to an ESOP. He did an ESOP and it worked out well. And there was one. But the other two of them, you'd think they'd put someone on there to give the owner's perspective. Those people do exist. I've certainly do exist. Of course they do. You know what? I asked a question on there and the guy gave an honest answer. I said to him, Could you have gotten more money if you would have just sold to a private equity, and he's in an industry that there's a huge conglomerate that's buying up everybody for huge multiples. And he goes, Oh, I absolutely could have got more money, but I got enough. And you know what? I appreciated that answer cause it was honest and, and I think his business is big enough, enough in his case, was a lot of money. It wasn't like he got $2 million instead of 4. Jay, I have two questions for you. Um, you, you say that you're thinking about ESOPs again, uh, your mind is open. There were a couple of issues that came up that you thought were kind of deal breakers. One was you didn't want to hang an ESOP on your kids if they stayed involved in the business. How are you thinking about that now? Uh, there's, I have two answers to that. One is, if I continue working for 15 years, which, who knows, but I'd be 82, I think that's not, that might be the case. My kids are gonna be 53 and 48. I, I don't know that they're gonna want to go ahead and just take over and start running. So, so there's that. And B, I think this would make their lives easier for all the reasons that ESOPs are promoted. Um, people are more invested, they hang around. So, yeah, I've changed my head on that, that that would be a good thing cause there's a lot of flexibility with an ESOP. Like if you sell your business, boom, done, you're out. Here, I could retire in 1 year, I could retire in 2 years, 5 years. It's flexible, you're still running it, but there's an infrastructure in place that's in place for when you either by choice or you drop dead, whatever the reason is, there's an infrastructure in place to continue on. So, I've recognized it might just be a good uh infrastructure to put together because if I don't do it, I'm left with the same problem of, so then what do my kids do when they've decided they've had enough. Now what? we're going back to square one. So, um, I'm very seriously looking into it. It's gonna take me a couple of years to actually get it to work. Well, let me ask you my second question then. You have said in the past that you don't really feel the need to, to grow your business. You're not looking at opening new locations or anything like that. You've done enough of that. Can you run an ESOP without trying to grow, or do you need that growth to, uh, pay back the loan or, you know, pay back the loan out? A lot of the problems you hear is when they take out the bank loan. OK, I don't need to take the cash out, so I will finance it myself, which, OK, but then they have to pay you. So I believe though is flex. OK. So the answer is, when I say I don't want to grow, if I grow it, uh, 6% a year, that's perfectly fine. Just organic growth from my existing locations. Now, are my employees going to retire with millions of dollars? No, it's not going to be one of those cases where the business grew, you know, 10% a year for 10 years. But again, it also solves my problem, which I accept. I'd like my employees to have more. Retirement savings. So it takes care of that, which this is part of why I turned off and I said this to you. I realized I can do a tax-deductible way. All I have to do is say, OK, everyone, I'm going to give you 2% of your salary in the 401k plan. It's a deduction to the company. They get it in the 401k. So that took care of that problem. So, that was one solution. This solution also takes care of that problem, but it has the extra benefit of the whole engagement piece, the whole PR piece, which doesn't have to be dramatic. If sales went up 2%, that's a lot. That would cover the expenses. Um, if your engagement got just a little bit better. None of this, I, I'm not suggesting any of this is gonna be, uh, all of a sudden the company is gonna dramatically change, but just a little change should pay for itself. What I have to figure out is, What are the complications of this and what is the downsides, which I haven't yet had enough experience with talking to the consultants to find out what the story is. That's why I'm telling you, I'm not sure I'm doing it, but at the moment, I'm certainly looking into it cause it's got lots of potential ups. Sean, you've talked here a little bit about um being in the process of a leader transition. Can you give us an update on how that's going? Yeah, Jay's gonna come run Kinesis, and it's supposed to be a secret, for God's sakes. Yeah, yeah, I promoted, Anya Taylor to the role of president. Um, she's been with us for, oh gosh, 4 or 5 years now, really wonderful. She started out as, um, in the operations side, moved into kind of a people leadership role. She's, uh, if you do strengths finder, you know, she's a galvanizer, you know, she's really good at coalescing people around around things. It was just a really well received amongst the team. They're excited about it. She's excited about it. She's really taking a lot of leadership. Wait, so what's her new title? She's president? Really? So I'm still CEO. And you know, essentially doing that 2 year transition of showing her how to do all the stuff that I do and catching her up to speed on that. With the goal of your role becoming what, chair of the board, you know, move to more of a board position eventually. Do you have a board? It'd be just me, yeah, you'd definitely be chairman. Yeah, for sure. Wait, how old are you? 52. So at 54, you become the chairman of the board. Wow. That's, that's the goal, you know, I mean. We're still digging out from the pandemic, you know, it was, uh, we had, we had a pretty predictable machine going into it and it, it really screwed all that up. And so now we're rebuilding and retooling and so, yeah, there's still a lot of work to do. You've talked about that a little bit, Sean. You've talked about the tool you were using previously was going to events and, and holding events. Obviously, the pandemic interrupted that, but you're getting back to it. Uh, you have your own event coming up in September, right? Catalyst? Yeah, Catalyst is September 7th and 8th. It's um it's an event for owner operated businesses, you know, so, you know, a room full of, of business owners, basically. And this is our 2nd year of doing it in person and our 4th year of doing them. We did, we did 2 years of virtual, and now we're doing them in person. So wait, explain this to me because the concepts I'm having a hard time getting my head around this. So when you're this chairman of the board. Will you be golfing? What will you be doing every day? I'm trying to get this going for massages and then maybe the stockbroker on Friday, and then golfing the rest of the days. What, what's the story? I, I like golf as much as you do, Jay. So, um, no golf, yeah, no golf. Although I hear pickleball is huge, so I might, you know, pick that up. You know, I think the job of a board chair, you know, in that type of position is to just make sure that the ship is still sailing roughly in the same direction, in the right direction, you maintain commitment to the values and the vision. Um, but, but ultimately, you know, you're letting other people have control of the rudder. And how many employees are there going to be at that point, do you see? Um, I think when I leave, I think we'll probably be 14 or 15. Yeah. It was, it was very tenable in 2019. Um, had the path laid out, you know, I, I, I've handed over a lot of the jobs at Kinesis of many years ago. I think unlike a lot of owners, I never had a strong emotional attachment to being the guy in the room, you know, like in in the consulting business, oftentimes. You have to sort of be the owner and the smartest person in the room, and I don't know that I'm really the smartest person in the room, and I never kind of needed that as part of my identity. So I built out a system where I wasn't delivering the work, and we've been doing that for, I don't know, over 10 years now. I call that going from a profession to a business, that you're no longer the, you know, the doctor, you're the person who hired the other doctors, so you made the transition into, well, that sounds good. OK, you're gonna come to Chicago and hang out some, you're gonna what? Can I count on that? Can I write that down? Yeah, I, I sent you an invite to Catalyst, so I'm just waiting for you to show up. Shaw, are there still slots available? And if anybody's listening who's interested, who should come? Yes, uh, the people who should come are business owners who have employees. That's sort of like a lot of the work, uh, we do at the, at the event is collaboration. And kind of shared workshops and a lot of it's around, you know, how to elevate teams, how to create a sense of shared culture, momentum, um, so businesses that have employees, businesses where the owner is the operator, you know, not anything private equity, they would never come to this anyway. Nobody owned by private equity would ever come to Catalyst. So who shouldn't come to this? Private equity. Yeah, private equity. Yeah, I think, I think for for solopreneurs, it's, it's a big investment, you know, in terms of the ticket price, so it's probably not as much for them as it would be for somebody who's who's moved to a place of having employees. I think the theme of the the the conference is bold type. So it's really about the idea of like challenging the status quo and to our conversation early, earlier about being curious about what needs to change and what can be done differently. So yeah, you're gonna, you're gonna find a lot of owners who think differently and think about big ideas, as opposed to best practices and, you know, kind of cranking the wheel in the same way every day. All right, we have just enough time for one more topic. I've had some conversations with Jean Marks of late about regulation. Gene's pretty anti-regulation, as you know, if you listen to any of our Monday dashboard episodes, he's told me that he just doesn't like being told what to do by the government, that he's insulted when he's told to not do something he wouldn't, he probably wouldn't do anyway, and that neither he nor his clients would ever do anything that they're Not supposed to do. Out of the goodness of their heart. I, I don't want to debate Gene. It's funny in itself that his clients were, OK, does that mean nobody would do it then? I mean, really, I mean, seriously, we don't need some laws to make sure people don't get abused at the workplace and stuff. I don't want to debate Gene since he's not here to, to make his own case, but I did want to ask you that question. I mean, he's kind of making, he doesn't quite. this far, but he's kind of making the argument that all regulation is bad or unnecessary. Do either of you agree with that? I don't. I think that once in a while there's something comes up that is a problem, but generally speaking, I don't have, this isn't, this isn't one of the things on my top 10 list of issues I'm dealing with that there's too much regulation. I, it's not on my top 10. Sean? Yeah. I mean, I think Gene's engaged in selection bias, you know, he He's probably has some good clients and so, you know, to apply that mindset of like, I have good people around me, ergo, we don't need regulation, it's just a, it's just a cognitive bias. So let's just set that aside. But in terms of your question, I, I'm sorry, I had to I had to debate Gene even though he's not here. But um, but setting that aside, you know, I think that there are many cases where regulation can help actually level a playing field and make it for, make it, make it a more actually fair situation even for small businesses, so. You know, I, I just, I, I just think like when we've, we've had situations of no regulation, you look at things like the tech sector and what's happened there, you know, children working in meat factories, like there's just lots of bad examples. We're bringing that back, you heard? Yeah, I know. Let's start with the basic one, which I just minimum wage, does he not believe in the minimum wage? Actually, he doesn't know it, he doesn't. OK, well. Kind of says it all. No, he would never pay someone minimum wage, I, I don't think, but that doesn't mean other people won't. I, I just think, you know, uh, so in Oregon and and in some other states you're seeing a move towards um pay transparency, right? And You know, there's a lot of strong opinions about this, but my experience has been that we've been way out ahead of this long time, right? We've said, hey, we're gonna actually be transparent in how we compensate people. We're gonna put that in the job postings. We're gonna have pretty narrow ranges of what we pay people. And honestly, it's been fantastic. Like, it's really helped create a more peaceful environment and a better hiring process. They advertise. I forgot which ones. They track it and when you You put the al range in, you get a much better response. So this is a case of believing in it or not, it's going to help your hiring process if you do that. I think there's also a really important conversation around the difference between regulation and bureaucracy. And I, I, in my experience, owners are more irritated by bureaucracy than they are by regulation. Well, what would you call this? Because this is a real problem. In the state of Illinois, if you hire someone and there are 30 working days and you end up Firing them cause whatever they can't do the job, you are responsible for their entire unemployment, meaning they could have worked somewhere for 20 years. It's all on you. And my argument is, it makes it difficult to try someone out, quote unquote. In other states, it's 60 days. Why can't we go to 60 or 90 days? It'll help the hiring process and maybe I'll take a little more chance on someone that, OK, you've never done this, but we'll be able to tell in 60 days whether you've adapted to it. That's not helping anybody. Well, and, and you bring up a really good point too. It's like, OK, so we're moving to a world where there's much more remote work. What if you have one state that's crazy about stuff and another state that's like, pretty hands off, you know, like, that creates huge problems for employers. I mean, just massive. I mean, I never even thought about that. I would have to know what the regulations in every state. I mean, right. It's I mean, we have employees now in two states, and it's a Freaking nightmare, a total nightmare. Uh, uh, even just two states, just two states like Maine and California. Tell me, like, how I'm supposed to navigate these waters. It is really freaking payroll service should help because I have 3 other states. So what's the issue, Sean? What's the issue? Everybody does it differently. That's the problem. Even what Jay is saying, Oh, is it 30 days or 60 days? Is it 90 days? How do you do workers' Comp insurance, how do you deal with things like people, uh, being laid off and like, what kind of be, you know, it's just, it is bonkers. Some of them want you to file a tax return that, that like, they want some of your income for I mean, yeah, yeah. So I've got a sales manager in one state. I've got two people that moved out of town. and then I'm in Chicago, which means someone could live in Indiana and work here. I've got one employee who lives in Indiana. I got one employee who's in Wisconsin. So actually, I've got 4 people that are out of state, and I don't know that I'd call it a nightmare, but it's a pain. And the payroll service certainly takes the edge off of it. It's not a nightmare for you. This gets back to your scale size, Jay. Yes, you're right. At a small business size, it's a freaking nightmare. I'll use one more example. There's a river between Portland and Vancouver, Washington. I have an employee who moved over that river, and now, because we don't have an office. The state of Washington is like she is ours. And so now we're having to deal with all this bureaucracy from the state of Washington. She's literally like 3 miles from me. It's totally insane. I, I, I mean, so this gets me to like, uh, you know, we need better national regulation and less state regulation, but that's not where that's gonna go. My thanks to Sean Bussey and Jay Goltz and to our sponsor, the Great Game of Business, which helps businesses use an open book management system to build healthier companies. You can learn more at greatgame.com. Thanks, everybody. Wait, wait, don't leave yet. If you have a question or a comment that you'd like the 21 hat's owners to address, send it to me by replying to your morning report or by email at lauren@21hats.com. That's L O R E N at 21 hats.com. Do it now before you forget and don't be afraid to tell Jay what you really think. You 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 21 hats.com. This episode was produced by Jess Thuberon, founder of Blank Word Productions. OK, now you can leave. Thanks for listening, everyone.