How I Systemized, Scaled & Sold My Business & Am Retiring Successfully

My Background

CRE Appraisal

After working in residential brokerage and property management in my 20s, I got started in commercial real estate (CRE) appraisal in Portland at the age of 30 and soon found myself in Downtown Los Angeles (DTLA) working for Cushman & Wakefield and CBRE Group for 15 years in their appraisal and investment properties divisions.

MLM

While at CBRE, I decided to pursue a side-hustle with a new network marketing division of Rexall Sundown -- Rexall Showcase International. I guess I was a natural business opportunity promoter, as I quickly recruited over 20 medical doctors and grew my downline to over 1,000 distributors in 3 countries and annual sales approaching one million dollars.

Internet SaaS

When the president of CBRE's Investment Properties Group left, decided to raise $20 million in venture capital, and started PropertyFirst.com, he hired me as the number two person to help build their AppraiserLoop SaaS product.

After a year, PropertyFirst.com merged with LoopNet.com, and a year later, in order to help extend the runway for LoopNet, I helped sell our division to Marshall & Swift for 7 figures. I left LoopNet after selling back my stock options for $5,000.

A few years later, LoopNet was sold to CoStar Group for $860 million. If I had retained my stock options, that would have made me a millionaire. Important lesson: never sell your stock options!

Startup

Tired of Corporate & DTLA

I had the opportunity to go to work for Marshall & Swift with their new AppraiserLoop division. However, I was tired of the corporate world and commuting into DTLA so I decided to hang up my appraiser shingle and go out on my own.

Sole Proprietor

I started out as many appraisers do, working out of my home, turning my wife's and my bedroom suite into my home office. Burned out from my previous life doing huge, complicated, regional mall appraisals, every one requiring mind-numbing DCF analyses, I decided to pursue single-family and small-apartment appraising using residential forms software. I was operating as a sole proprietor and, frankly, didn't really know what I was doing in terms of operating a small business.

Separation

That first year or two as a small business operator was so stressful and chaotic that it almost cost me my marriage. I ended up having to move out of our home and rented an apartment near some basement office space that I was lucky to sublease a small office in from a well-known MAI here in SoCal.

Paradigm Shift

E-Myth Revisited

Time went on, with me doing everything in the business as a solopreneur. It was exhausting! Finally, I picked up a copy of the book E-Myth Revisited by Michael Gerber, and that book literally changed my life!

I think the key takeaway for me from that book was that I needed to try somehow to create what Gerber called a "franchise prototype", systemizing and scaling a world-class company with other people working "in" the business while I elevated myself to a CEO mindset to work "on" the business.

Becoming a Strategic Business Owner

The next book I read was Becoming a Strategic Business Owner by Daniel Murphy, founder of The Growth Coach coaching franchise. This was the first time I clearly saw the many things a business owner really has to focus on to build a truly world-class business.

Run Your Business, Don't Let It Run You

Finally, I saw Run Your Business, Don't Let It Run You by Clay Mathile in a bookstore, bought it, and devoured it. Clay bought the IAMS pet food company and grew it from $12.5 million to $1 billion in sales before selling it to Procter & Gamble for $2.3 billion. He wrote about professional management as one of the critical keys for this growth. I went back to Aileron, his non-profit foundation in Ohio, to their Course for Presidents, and worked with one of their DOC coaches for a year, one of the many business coaching programs I worked with over the years.

Foundation

Estate Planning

One of the key things I did early on in my marriage was to get with a good trust and estate attorney, who put together a trust, will, power of attorney, etc. for both my wife and I. We coupled this with working with some really good insurance agents to cobble together life insurance, long-term care insurance, and umbrella policies.

Financial Planning

We also worked with a great financial planning and investment advisory team (Joel Almquist and Michael Cadis with MassMutual Greater Pacific in Pasadena, CA) who helped us with our first financial and wealth management plan, and has been helping us annually and quarterly ever since. This is the single most important thing I've done financially, in terms of wealth building, and I would say this team is truly worth their weight in gold.

BHAG & Valbridge

A few years into this buiness-building phase, I read Jim Collins' book Built to Last and came across his "Big Hairy Audacious Goal" (BHAG) concept and decided to dream big as the sky and give it a try. My written BHAG was basically that my tiny few-person firm was going to become the biggest and best franchise opportunity in the whole wide world!

A year later, miraculously, I had been approached with the Valbridge opportunity, we formed that organization, and had grown it into the third largest CRE appraisal organization in the U.S. Today, Valbridge Property Advisors is the largest independent CRE appraisal organization in the U.S. with over 200 MAIs and 80+ offices nationwide.

Systemizing

Initial Admin Assistant

Early on, after reading E-Myth Revisited, I realized I needed to stop doing all of the tactical work of the business myself and start working "on" the business as its chief manager and leader. It took me a couple years, but I finally screwed up my courage and hired my first employee, who initially served as a half-time appraisal assistant (we now call these Analysts) and half-time administrative assistant.

On her first day, I let her know that if a task was recurring or repeatable, she was suppose to document it so we could start putting together our Company's "Operations Manual". This continued until the day she sadly left our Company 13 years later.

Learning & Education

I became a student of business systemization, operating manuals, standard operating procedures (SOPs), checklists, and all of the various software products designed to help companies systemize their operations.

SOPs & Manuals

We used several SOP SaaS products over the years, finally deciding to use Zoho Connect and its Manuals functionality to house our over-500 SOPs. We created several role-specific manuals as well for our Analysts, Reviewers, Operations Director, Client Services Director, and Quality Director.

Scaling

Recruiting & Hiring

Over the years, we recruited and hired dozens of people. At first, we did this ourselves. However, it didn't take us long to realize we really didn't have any expertise with the many parts of this process - sourcing, screening, interviewing, negotiating, hiring, and onboarding - and so we outsourced this important function to various talent agencies and PEO companies we worked with.

Professional Management

One of the most important things I did in building my business was to learn about professional management. I learned about this process in Clay's book and at Aileron, and that started me down a several-year path to find a truly simple professional management system that would work well and be able to be self-implemented by a small professional services business like ours.

After many stops along the way, I found Gino Wickman and his books Traction and Get a Grip. A protégé of Verne Harnish (EO founder, Scaling Up CEO, and Mastering the Rockefeller Habits and Scaling Up best-selling author), Gino created the Entrepreneurial Operating System (EOS) -- condensing and simplifying Verne's mid-market business coaching program into a much simpler and doable self-implementable system for small businesses like mine.

We started self-implementing Gino's more-simplified professional management system several years ago. I credit Gerber, Murphy, Mathile, and Wickman, and their ground-breaking books and programs, with much of our success.

Running the Business by the Numbers

In 2008, we hired a small firm in New Jersey to help us build our first Assignment Management System -- a relational database in QuickBase housing all of our companies, contacts, properties, quotes, awards, etc. -- to help us run our CRE appraisal business. That and QuickBooks Online are the key databases we used to scale.

These databases helped us track key performance indicators (KPIs) in our business, which flowed into tracking sheets, scorecards, and dashboards our management team and staff could use to guide and improve our business marketing, sales, fulfillment, finance, and back-office administrative functions.

Selling

Exit Planning

I read several books on exit and succession planning and, to a tee, they all recommended starting this process earlier rather than later. I concur. You can't start this exit planning process early enough! Although I wish I had started this exit planning process earlier than I did, I still started it, which is key, and that made all the difference.

When in doubt, just start and take action! The rest will take care of itself. Don't get waylaid with "analysis paralysis". Remember: Ready, Fire, Aim!

Professional Help

I first enlisted the services of a really good business valuer. The first year he valued my business, the resulting market value was not very impressive. That just motivated me to keep scaling and improving the business.

I got involved with the The Value Builder System after reading John Warrillow's book Built to Sell. That book, and Exit Rich by Michelle Seiler Tucker & Sharon Lechter, plus working with an experienced local business broker, helped me form a strategy and action plan which ultimately resulted in an all-cash 7-figure sale, with no earn-out (virtually unheard of in small business M&A transactions).

Negotiating, Closing & After

Due to many factors, not the least of which was that I had truly built a valuable, sellable, owner-independent business and was able to leverage the Valbridge Property Advisors brand we had worked so hard to build, we were approached by several interested companies -- global and national CRE companies, appraisal competitors, and Valbridge franchisees.

We ultimately sold to a neighboring Valbridge franchisee who I had worked with very closely with during the formation and growth of Valbridge over the years. Of all the suitors, I felt he and his wife would be the best fit for our business, team, and clients. Due diligence and closing took a few months as did the transition to the buyer after closing.

Retirement

Recreation & Leisure

Life after traditional business for me is hopefully going to include a 40-foot Fleetwood Discovery LXE 40M RV coach, touring the U.S., taking up golf, more workouts each week, VRBO stays with family, cruises, and some much-deserved downtime in beach chairs by rivers, lakes, and the ocean.

Health & Relationships

All the money in the world isn't worth much without your health, and family and friends to share it with. Unfortunately, one of my greatest failings and regrets in life was to sacrifice relationships as I strove hard for professional and business success.

I plan on focusing on healthy eating, exercising and working out, and pursuing old and new relationships and friendships with family and friends in the weeks, months, and years to come.

Purpose, Meaning & Giving Back

As I mentioned in a recent LinkedIn post, now that I'm retired from traditional business, I'm starting up a new one-person online business to share my experience and skills and help others succeed. The greatest accomplishments of my life have been the younger people I have had a positive impact on. I have a dream here in retirement of helping thousands of small business owners systemize, scale, and sell their businesses successfully so they too can retire rich and give back to others.