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What Your Remodeling Business Is Actually Worth (And How to Increase It) · Remodelers On The Rise

• Kyle Hunt: Thanks for tuning into the Remodelers on the Rise show. Whether you're listening or watching, I appreciate you being here. If this was helpful, make sure you're subscribed so you don't miss the next one. We're putting out new episodes every single week focused on helping you build a better remodeling business with real stories, practical ideas, and things you can actually take and use. If you're on YouTube, hit that like button and turn on notifications so you know when new episodes drop. Hey everyone, listen in. Welcome to the Remodelers on the Rise show. I have a guest from the St. I like to just say St. Louis. Is that too informal, Jared? Jared Ribley: not at all. Kyle Hunt: Okay, from the St. Louis area, folks, his name is Jared Ribley. He's the managing partner at Capstone ⁓ &A Mergers and Acquisitions and president of the Exit Planning Institute's St. Louis chapter. And he's a certified exit planning advisor. He actually, we connected through shout out to Dave and Paul Hamtel, brothers who run a wonderful remodeling business in the St. Louis area. And you guys actually go If you're listening on a podcast app, a five-star review goes a long way and helps more remodelers find the show. We've got great links below or in the show notes where you can connect with us, check out our remodelers community and learn more about our coaching and resources. Appreciate you very much. See you on the next episode. Way back or you've known each other for a long time Jared Ribley: quite some time. Our kids hung out in diapers together. So if that tells you anything. Kyle Hunt: Mmm. I see. He got any good story, any Paul or Dave stories, any dirt on him or anything? Jared Ribley: I do, but honestly, Dave and Paulie are, their craftsmanship is a lot like their character as people. And I don't just, I don't say that lightly. ⁓ They, both of them are gems and Paulie and I especially, we have a 25 year history. ⁓ So I know his parents, ⁓ I know his dad who originated, you know. Kyle Hunt: Quick question before we start, when was the last time you stepped away from the day to day of your remodeling business and actually thought strategically? That's exactly why we created Rise Conference 2026. It's happening August 11th and 12th in Ann Arbor, Michigan. Two days, real remodelers, practical systems, lots of community, lots of learning, lots of fun. Jared Ribley: Got them started. So yeah, they're they're gems Kyle Hunt: Yeah. And you always call him Polly. Wow. I might have to. Okay, I might have to grab ahold of that. Jared and I are actually recording this 13 days before I'll be seeing Jared in person. He's going to come and spend a little time with the Elevate peer group. We have our in-person retreat coming up in St. Louis that the Hamptels are hosting. I might just, I might try, actually I'm talking to Dave and Paul this afternoon. I might try out the, Hey Dave, Hey Polly. Jared Ribley: I do. I just, it's just a thing. He's Pauly in the phone. Yeah. Yep. Kyle Hunt: lots of time built in to create a plan you can actually implement. If you're feeling stretched, reactive, or unclear about what's next, this is the room to be in. Details are at remodelersontherise.com slash rise. Now let's dive in. And he might look at me going, what is that about Kyle? But Jared and Dave and Paulie have gotten to know each other a bit, ⁓ obviously over the years. And in particular, did a little work around this. What does exit planning look like? What does it mean to be ready to exit? Whether that means we're not going anywhere and we're keeping this business for years and years and years to come. But this concept, if I'm a remodeler listening to this and I might be in the second half of my career, frankly, I might be even early in my career and my business. Hey, let me take a quick break to say this. One of the biggest shifts I've seen in remodelers over the years happens when they get in a room with other growth-minded business owners. That's what the Rise Conference is all about. August 11th and 12th in Ann Arbor, Michigan, pricing, leadership, production, marketing, and most importantly, real conversations with people who understand your world. this idea of what does it look like to plan your business well, to structure your business well, to be thinking about what does this look like and how do I build value in my business if and when I decide to perhaps sell it. And as I've been in business now for 18 years, I'm seeing more of my clients as the years go on, either sell their business or quasi-retire or retire in place. There's a lot of different ways this can look. If you want clarity and momentum heading into the next season of your business, this is a great place to get it. And it's a lot of fun. You can find all the info at remodelersontherise.com slash rise. Now let's keep going. So we're going to dive into that topic. Jared, give a little background kind of how you got into this area of work. Jared Ribley: Sure. So I've been selling privately held companies for about 14 years now. When I started, I was kind of the young guy. Now I'm somewhere in the middle, maybe. But I would say when I started, everyone was kind of 15 to 20 years my senior. And so I started at a business brokerage firm, the largest in St. Louis, and spent about seven years there, really just learned the culture. ⁓ The industry and and made a good living and then was recruited to be a managing member at another business brokerage company Yeah, went over there helped them with a little bit of a turnaround ⁓ they didn't have as much traction as they want or needed and And then was recruited by my now partner who owns Clayton Capital Partners in st. Louis so it's an investment bank and Him and I started capstone ⁓ &A specifically to serve the one to $20- $25 million enterprise value space. A lot of times that's a little bit too large for business brokerage and not large enough for investment banks. And so it's this segment of business owners that get often overlooked and underserved. And so our genesis was to create a better process for that level of business owner client. And we are, and I always have been, agnostic entirely. Kyle Hunt: Hmm. Jared Ribley: So we have construction companies right now on the market. have excavation, trucking, consumer product goods, ⁓ home health care, just a variety of different industries. ⁓ And then somewhere in my career, about eight years ago, I got, as you mentioned, the certified exit planning advisor credential, which is just, and we can talk more about it, ⁓ however much you wanna. go there in depth, but it's a training of best practices as it relates to exit readiness. It's kind of a quick way to describe that. So yeah, it's been an interesting ride. Kyle Hunt: Awesome. So as you, as you even consider, you look at these different industries that you have been selling businesses in, when you look at the remodeling ⁓ side of things, what are kind of the pros and cons as far as the value goes, as far as selling a remodeling business that might make it more challenging than others, or might make it more attractive as others? What are kind of your thoughts there if we, if we would start and dive into that? Jared Ribley: So generically, ⁓ you look at the type of revenue, right? So our perspective considers that of how the market looks at opportunities and the market, just so we can clarify, because it's one thing to say, ⁓ we're gonna go to market or we're going to sell this on the open market. ⁓ It's important to understand what that means. So when you say the market, what you're referring to is three different types of buyers. Collectively that makes up the market. So it's institutional capital PE etc strategic buyers and Kyle Hunt: ⁓ you don't even want to use their full name? Private. Jared Ribley: Yeah, private equity, that's correct. There's a lot of them now. It's getting interesting. ⁓ So private equity, strategic and individual buyers. And the way that they view opportunities is they evaluate ⁓ businesses based on their type of revenue. So a lot of times remodeling companies, construction companies, they are project oriented, right? what we call project revenue. And that can hinder valuation because of the predictability and the continuity of success post-sale. The whole, you're only as good as what you kill and et cetera and so forth. We have an excavation company right now. They're 100 % project-based. So I'm not a professional at construction in general. remodeling. ⁓ I've sold those companies before and if there's any opportunity to add sticky revenue, reoccurring revenue, maintenance contracts, things like that, ⁓ that generally appears ⁓ appeals to the market versus just strictly project revenue if that makes sense. Kyle Hunt: Mmm. Yes, that makes sense. So even just the concept of, you know, a plumbing company that's been a business for 20 years versus a residential remodeling company for 20 years. If you compare even those types of project types of ⁓ companies, you know, on the plumbing side, there may be maintenance contracts. There may be ⁓ even the idea of, you know, our five million dollars of revenue is made up of, you know, a thousand different projects. or on the remodeling side, our $5 million of revenue, you know, comes out to, you know, 70 projects or whatnot. So even just the risk factor, that recurring aspect that plumbing company may to the investors and those three different private equity, strategic individual buyers could look a little less risky, frankly, on the plumbing side than maybe on the remodeling side. That, a fair way of looking at it? Okay. Yeah. And I kind of started there because I think Jared Ribley: Very much so. That's very accurate. Kyle Hunt: A remodeler listening to this, your business is not the easiest business in the world to sell. That does not mean that it is impossible. That does not mean that there isn't great opportunity for it, but it is a little bit of a harder animal because of what you mentioned, the project-based versus the sticky or recurring side of things. So, So with that said, you do a lot of, talking around kind of exit readiness and getting ready to exit, what does that mean for the business owner? What does that look like? Jared Ribley: Well, it's holistic. ⁓ I'm going to try and do my best to simplify that. So there's two different lenses that the business owner should look through when they're looking to answer that question and solve for that problem. It's personal readiness and business attractiveness. Those are two different things. They're independent of each other. For example, if the business owner knows what they need to get out of a sale and they're dialed in with their wealth manager and their tax advisor and etc. ⁓ You could call that person personally ready especially if they know their life after the sale. They've already processed that they're going to go ⁓ start a bait shop in Fort Myers Florida or whatever it may be right. ⁓ That is what we would describe as personally ready. Now, if they don't have their business to a point of being attractive to the market, the process isn't going to come off very well. Those two things need to be aligned. They're as important as each other. ⁓ So exit readiness or market readiness involves looking at that and looking at all the aspects for personal readiness and business attractiveness. So we have an Kyle Hunt: Hmm. Jared Ribley: We have an assessment that I'm sure we'll talk a little bit about, but all the questions can be subjugated underneath one of those, those two lenses. And this is not something that ⁓ is terribly easy to do on your own. So you need what I call the village. You need the village people around you. ideally, not this, maybe it's a second podcast. Kyle Hunt: Wait, are you about to break out in the song? Okay, stay tuned folks. Jared Ribley: Maybe I'll save it for that. So, I, it's my opinion and belief that ⁓ it does take a village and you need all your advisors. So you need the wealth manager, the CPA, the business attorney, maybe somebody in my position. If you're doing an internal sale, that's great. Or an ESOP, that's fine. You need the right individual for that as well. But if you're going to market, you may need somebody in my position. and those people need to be talking with each other ahead of the sale to optimize ⁓ the pre and post proceeds from the sale. And so that means a lot of things, ⁓ but that's a little bit. Hopefully that answers some of that question. Kyle Hunt: Yeah. Yeah. No, does. I like the two lenses. I like the personal side. Talk to me, expand a little bit on the business attractiveness part. Let's kind of unpack that if you will. What makes the business more and more attractive? Is it a lot to do with kind of the owner centricity? The idea that the owner either isn't the point person for this or this or this. Is that kind of, you know, 60 % of the pie or is it kind of divided up into What makes it attract? Jared Ribley: To answer that question straight away, I would tell you that we have, so that some of our questions in the assessment are weighted in importance and in value. And the owner reliant questions, there's a few different ones, a few different ways to approach that topic. They're weighted the heaviest. So I'll let that kind of just sink in. ⁓ owner reliance, you know, it's, it's an interesting dichotomy because especially a lot of the baby boomers, you know, lot of our, our clients are baby boomers and they are super proud of what they've built and rightfully so, ⁓ because a lot of the boomers and then the generation previously basically built America, right? So I'm, I'm with them, ⁓ in spirit. However, when all of the contacts, Kyle Hunt: Mm-hmm. Jared Ribley: of the customers and the clients. All of the procedures and the policies and the processes are only in their head. ⁓ When there is no documentation and the owner, the business ceases to exist without the owner being physically present, ⁓ you're going to get penalized for that in valuation. It's just that simple. So the thing that you're most proud of ⁓ actually can hurt you. And that's a very interesting conversation to have because most business owners don't realize that until people in my position kind of unpack it and give them a different perspective. Kyle Hunt: Mm-hmm. Yeah, the, even thinking owner reliant, I use centricity, even better owner reliance, the penalized in valuation. And it just makes sense when you step back from it. If I'm going to purchase your business and you show me a business that has a general manager that you kind of just oversee that has a, it has a clear leader of the production side, a clear leader of the sales and marketing, a clear leader of the design development, whatever that might look like. And you show me that your month in month out for the most part is managing that team and casting vision and whatnot. That business is worth, I'm going say much more. It's going to be worth more than a business where I go, okay, I pull you out of this role. I need a hire to replace you. I need to fill that gap. And it becomes real, real fast. ⁓ Interesting, like penalized and valuation. Give me your kind of hot take on. Jared Ribley: Yep. Yep. Kyle Hunt: You know, everybody, think whenever, whenever somebody talks about what's value of my business, they're like, well, you know, it's just three times this. It's five times that it's four times that. I guess I've seen enough examples now, whether it be an internal sale, whether it be from a family member to a family member, whether it be just straight up through a business broker that you can kind of set aside that multiplier for the most part. Jared Ribley: Mm-hmm. Kyle Hunt: because it's very nuanced. Tell me about your experience with that or teach us about that a little bit of how to think about it. Jared Ribley: So nuanced is a good word. And I think you're very accurate in saying that. Again, a simplified way to articulate that topic for me would be, yes, by and large business valuation is comprised of financial performance. That makes sense. How much money do you make? How much money does the company make over the past few years? And then, And by the way, that's a math problem. I mean, you need to work with the appropriate advisor to identify that because it's not just net profit. It's a lot of times what we call adjusted EBITDA. So it's not just EBITDA either sometimes. ⁓ But it's a fact-finding process. So you need to go in and really look most business owners, they want to get that net profit down as much as possible so that they can mitigate their tax implication. Kyle Hunt: Mm-hmm. Jared Ribley: which is understandable, we go back in and unpack all of that and then model it on a spreadsheet so people like, you know, the market will understand what to look at. But then from there, we do have to pick the appropriate multiple schedule. And that's a little bit of an art and science as well. So we're looking at databases, ⁓ historical transactions to go, okay, this industry is trading for this. ⁓ Let's go here. And then we have a math problem. That's the financial performance. That's roughly 70 % of the valuation. Maybe it's less sometimes. Everything after that is about how transferable the company is. Everything after that. So that's a really good way to look at it. So yes, the baseline is always financial in nature. However, everything after that is going to be about mitigation of risk. and how transferable the company is. For example, let's say the company has a million in EBITDA and they're fetching a five multiple, then Simple Math says that they have a $5 million company and they have one customer. They're not getting $5 million at the time of closing. They're just not. ⁓ Maybe they'll get their price, but they're going to have to take it in terms. So, yeah. Kyle Hunt: Mm-hmm. Hmm. Excellent. I think that's just giving clarity. I'm hoping it is just perfect so far of just trying to, trying to unveil a little bit of how to look at this. It's super interesting as I, as I watch some colleagues of mine. Also, there's a gentleman who I'm watching that's, that's in a similar business to mine that's selling his business. It's been super interesting to watch that. And then, you know, I'm probably up to eight or nine of my clients who have done this now. Um, you know, mostly, mostly successfully, mostly. I'm going, ⁓ I thought I was going to get a little bit more. ⁓ the terms. But I think for a lot of people, this is just uncharted waters. I don't know what this looks like. I've just seen a real here and a real there and a little article here and a little article there. So we will in the, in the links. And we're going to talk about a little bit more. There is a really nice assessment that Jared has that would, that would give, they'll give you some clarity on that. We'll, we'll link to that and we'll talk about that as we go. But that that's helpful of just understanding owner reliance. That's helpful of. understanding, you know, approximately sometimes less financial performance is the biggest aspect of this mitigation of risk is the other part. And I want to talk about that mitigation of risk part, because I have a, I have a hypothesis that I think is true that, you want to sell your business or even, you want to have more freedom in your business. You want to have some flexibility in your business. Well, here's the, here's the, or, or you might say, You know, I'm early in my business. I'm not even thinking about selling. My hypothesis that I'm pretty sure is true is the same things that will give you freedom as a business owner and flexibility as a business owner are also perfectly in alignment with making your business more valuable and attractive to a buyer. Is that a true hypothesis, sir? Jared Ribley: Mm-hmm. It is so and it's it's funny you you put it that way and you say it that way so ⁓ I'm writing a book I didn't I didn't set out to be an author but ⁓ the book is we're releasing it underneath the title of ready for exit and it basically gives credence and context to the assessment that you mentioned and in the book ⁓ There is a there's a portion of the book. I think in early on Kyle Hunt: Mm-hmm. Jared Ribley: that talks about how saleability and scalability are not divergent pathways. They are very similar. So a lot of business owners, they're mavericks. I mean, they're trailblazers and they're looking to 10X their company and penetrate the new market and et cetera. ⁓ And they're not... wanting to look at the exit itself. They're not wanting to understand what that means because they're just, you know, they're in growth mode all the time. Well, interestingly enough, the things that you do to create saleability are very, very similar, if not identical, to the things that you do to scale a company. so if you start looking at like the whole idea of beginning with the end in mind, Kyle Hunt: Mm-hmm. Jared Ribley: and you start looking at these things to do as an ongoing practice. Not only do you have an exit ready company, but you have a company that's positioned well for growth. Kyle Hunt: So true, true hypothesis, folks, true hypothesis. Talk to us about what a well, what are you drinking, by the way, that looks like a fancy, fancy cup. Jared Ribley: This is the only, I will give a plug for this and hopefully I'll get maybe a free case out of it. Kyle Hunt: No, hang on, hang on, hang on. I have sponsors on this podcast, so just be careful with how much you plug. Go ahead. We'll plug whatever this drinking thing is. Jared Ribley: ⁓ do you? So this is called Highball. It's an energy drink that is the only one that's zero calorie. There's no suclarose. It's the only clean, it's like seltzer water basically, and it's got ginseng in it. So it doesn't crash you. I fast every day. And so I can't do much of anything. And that keeps me going. That's good stuff. Kyle Hunt: You know, I have noticed since we started this recording 20 minutes ago that your energy level has been going up with each sip. Now I know why. then then the side note, tell us about this fasting thing. So you're going like sun up till dinner. Type thing. Jared Ribley: Yeah, yeah, yeah. Yeah, it's been, it's been a real life hack. ⁓ you know, you don't, mean, I think it's becoming more popular now, but I think seven years ago, I, I looked into biohacking and I, I landed on the topic of intermittent fasting and I went, what is that? What do you, you don't eat breakfast? Like you skip lunch? Like what, does that work? ⁓ you know, cause I come from like, you know, do heavy leg day and eat a full pepperoni pizza. Like that's what you're supposed to do. And it's the opposite of that. And it's very interesting. It's super sustainable. ⁓ It's basically an insulin game. So you're playing, ⁓ you're playing a game with your own insulin, like getting your insulin down so your body can turn on itself ⁓ for energy sources from stored fat versus insulin. And not only that, but it's got like amazing regeneration capabilities. Like when you're in ketosis, for example, you're in the fat burning state, your body finds different problem areas to go fix, basically. So like the cell regeneration, that's very real. They're actually, and I'm not, obviously I have nothing to sell here, but they're actually starting to find that intermittent fasting is a very good application for cancer because it starves the cell, starves the bad cells, the ones that are disrupted. It can, but I think my ship has sailed. Kyle Hunt: Mm. Hmm, interesting. Does it help with hair loss, If you're watching the video version I got mine I got my bald noggin covered up Jared is wearing his proudly So I was mentioning that I was I was scrolling through Facebook the other night when we were going getting ready for bed my wife was laying next to me and she was scrolling and it's some ad popped up and It's targeted at some 40 something year old guy and the guys like give me a 56 days and I will make you fit Jared Ribley: So. You Kyle Hunt: And I'm watching and he's doing these little calisthenics. I'm like, I can do that. I just need to put my elbow to my knee and lift my knee up. I can do that. And then I'll be all fit looking. And my wife said, honey, if you would just stop eating cookies all the time, you would probably look like that. And I thought, hmm, maybe I do have more of a dietary issue than, ⁓ than maybe an exercise issue, but both go, go simultaneously. ⁓ that little break was, go ahead, go ahead. Jared Ribley: You know, if... If you ever want to connect offline about it, I'm very passionate just because it's produced good results. Kyle Hunt: like that. Um, I was proud of myself last night. You know, I ate dinner and I ate a little, ate a little dessert and, it was six 30. And I said to myself, I'm not eating anything for the rest of night. I don't care. I'm not, got, I got the Michigan basketball game on. We're going to stay up to 11. I'm just not going to do it. Sometimes just deciding is half the battle. Um, and then also just, I will plug this in. I had, uh, had my blood drawn today because, um, last month I went in for a physical hadn't been in for physical in a couple of years and just had things checked out, had the ticker checked out. Jared Ribley: There you go. Kyle Hunt: ⁓ and then had my blood drawn this morning. That was probably the first time in maybe four years, dudes and doodads listening to this, but maybe a little bit even more for you stubborn dudes. And also for you stubborn doodads. We just happened to start talking about health in the middle of this podcast because he was drinking the big old ⁓ energy drink. That's perfect for you evidently. ⁓ but let this be a reminder. You know, I've got a couple of clients right now that have got some ticker things going on and they've got some tests going on taking care. Jared Ribley: Mm-hmm. Kyle Hunt: You want to be ready for exit? You want to be, I'll tie it in with that, you want to be ready for exit? You want to be ready to live a good life in whatever retirement looks like? 30 year old you and 38 year old you and 52 year old you and 47 year old you, we've got to set aside time to move our bodies, to exercise, and we need to eat reasonably. Maybe even do some intermittent fasting. I know we all know this, and frankly, half the stuff we talk about we already know. But let this be hopefully a little reminder to a few people listening to this to lock in a little bit on that. Come on now, come on now. My mother-in-law really locked in on her health about two years ago. And I think it was directly related to, I wanna see these grandkids get married. Figure out what your reasoning is. Imagine yourself at 70, imagine yourself at 66, imagine yourself at 76. You've gotta take care of younger you in order. Jared Ribley: Amen. Kyle Hunt: Lord willing for you to be healthy when you're older. So, well, that was a fun little interlude Jared. Jared Ribley: Amen. was and to give you a little bit of context so one of my goals is to always be ready to climb a mountain. It may sound a little bit like David Goggins a little bit extreme but but here's why because Paulie Paul Hampton ⁓ called me up yeah no Paulie yeah Paul called me up last year and said hey do you want to do rim to rim Grand Canyon I said yes I do so yeah yeah Kyle Hunt: Hmm No, Polly. He's fully, fully known as Polly. Never know when that call is gonna come from a buddy. And that's another reminder, have a little adventure out there people. I'm too busy for that. No, you're not making the time and you're not prioritizing it. Figure out, dream a little bit. Have some bucket list items, live a little bit. Make sure your loved ones are part of that. Make sure your friends are part of that. All right, so we can talk about that all day. But back to the business at hand. We've already served the people listening to this pretty well here, Jared, of giving them some clarity around this valuation side of things. Jared Ribley: That's right. That's right. Yeah. Kyle Hunt: Walk us through, you may have touched on a little bit, but what is a well-structured exit planning process really look like kind of from start to finish? How far in advance should we be starting this? What are the steps involved? Walk us through that. Jared Ribley: So the best response to that is an attorney response and it's, it depends. I will say, I will say this. I will say this. The triggering event is always a business valuation. So find the right provider, the right advisor and get a business valuation done. It's no different than checking your portfolio, your retirement portfolio, your Zillow Kyle Hunt: Ew, yeah, don't talk like a- I don't- we don't talk like attorneys on this show. Jared Ribley: real estate values, do that, take that same vibrato with what's usually your largest asset, the business, and get evaluation done, I would say every year. If you want to get a little bit more granular, do it every quarter and just have a provider that you can touch base with to go, okay, now we're seeing it, right? Now it's objective. Now we know where we're starting because, and the reason that it's a triggering event, and that most good exit plans begin with evaluation is because you need a baseline. You need an understanding of, it's only worth three million. I need it to be worth five. Okay, well now you've identified the valuation gap. And the valuation gap is reality and expectation. But you can't do that without the valuation. So get the valuation done, identify if there is a valuation gap. And then once the valuation gap is identified, then you can go, okay, well, what do I need to do? Cause stagnant isn't going to get me there, right? Stagnant is, is 3 million in another few years. How do we increase the value? Another couple million to get me to my five in this example. And then you can say, well, these are the things that I need to do. These are the people that I need to work with to hit that mark. And that's probably going to take me two and a half years. Now you have a timeline. It's very difficult to do that without the valuation itself. Now, once you're inside of that, you know, I'm biased on the assessment. Our assessment very much addresses the market readiness issues, again, personal and business attractive, but it's not a exit planning tool. It's a diagnostic tool. So you can look at it, you can get done with it and go, okay, I have a valuation gap, whatever it may be. Kyle Hunt: Mm-hmm. Jared Ribley: Now I can go back and pick the right providers and the right advisors to help me with this heavy lift over the next two and a half years. Does that make sense? Does that kind of help? Kyle Hunt: Yes. Yes. No, that makes great sense. And even the idea of, know you're not ready to sell right now, but let's do a little research. Find, find a, you know, ask your CPA or if you want to find somebody local, reach out to Jared. You can connect to some people, but get evaluation. See what, see what this is coming in at. And it'll kind of open your eyes and frankly, it'll open your eyes and force you to grapple a little bit with timeline goals in retirement. It'll help you grapple with, how does Social Security and how does my retirement savings or rental properties or whatever, how does this all work together? What do I need this business to sell at? You know, there's some of you who are putting a lot of your eggs in the basket of I'm going to sell my business. And that's a risky thing to do, to have a lot of your retirement eggs in your selling your business basket. We need to be wise and make sure that we're investing in retirement and we're investing in some other areas so that we aren't kind of rolling the dice. And for some of you even almost go on Hail Mary style, ⁓ you know, at the end of the game to try to sell this thing. So I'm hearing like, let's get the valuation. Let's run the diagnostic tool to get clear with the assessment. And then, sometimes that's going to speak to, need coaching around this or this. You need advisory on this or this. Jared Ribley: Yes. Yep. That's Yep. Kyle Hunt: Okay. Now when it comes to ⁓ the buy the actual transaction part of it, what is the realistic ⁓ normal outcome as far as all right, I sold my business for $2 million. What is what's kind of the normal thing that you see as far as how that buyout happens? Is it a certain percentage of all right at close? Boom, here's your here's your 60%. And then we're going to bump up on we're going to have earn outs, we're going to have this talk to us about kind of the the approach that a lot of people take on that. Jared Ribley: Yeah, so I'd say at least half of the deals that we do have some level of what we call deferred payment and deferred payment can be personal compensation. can be earn out. Like you mentioned, earn out is unsecured ties. ⁓ variable based payments, ⁓ usually based on revenue metrics, et cetera. And then there's seller financing and seller financing is usually the most common. ⁓ it's that is securitized. You're given a promissory note. Kyle Hunt: Mm-hmm. Jared Ribley: We're going to pay you this much over time. ⁓ But at least 50 % have some level of deferred payment. Kyle Hunt: Okay. And then the other 50 % is just straight up. All right, we bought it for 2 million. Here's your 2 million. Have a good day. Jared Ribley: Yep, those are nice, but yeah, they're not too common. Kyle Hunt: Yeah. And think that's, and that's, that's again, just some reality check on this. I think that's part of what we're hearing here is like, Hey, you don't, you don't go to Lasi fare into ready to exit. You don't go to Lasi fare into selling your business. This requires a lot of just like, just like what got you to the point of building a business that is valuable and your intentionality around it and your approach to it and your systems to it. This is, this is a lot of times that next chapter, or even that final chapter for a lot of business owners where it's like, all right, this is kind of uncharted waters here. This is kind of new and there's a lot of things to learn, a lot of nuance to it. If they wanted to dig into the assessment side of things, are they going to readyforexit.com by chance? ⁓ Jared Ribley: Yeah. Yeah. Ready for exit.com. So this is the assessment that we've been using for our clients before going to market for a number of years. And we just got to the point where, you know, in this, podcast and your questions are a great example. People need more education around this. mean, business owners are the back, especially privately held businesses are the backbone of our economy still. And It's generally like you've outlined. It's generally their largest asset and you need to, you need to take care of it. You need to look after it. ⁓ so we decided to go ahead and just open source the technology. We've written the code for it. It's our stuff. there's a valuation mechanism at the bottom that helps grade and incentivize the business owner to basically the completion rate goes against the valuation range. So It allows you to see, ⁓ if I, if I want the other 40 % of this, then I need to go back and improve my score. It's the only way to do that is to go back up in the assessment and go, okay, I need to do this and this and this and this. ⁓ so we just think that it's a valuable resource and that's why we're starting to open source. And yeah, you can go to ready for exit.com and log in, create your own portal. ⁓ and it's yours as a continuous improvement tool. Kyle Hunt: Mm-hmm. Nice. Ready for for exit.com. Very cool. Very cool. And would that be how people could reach out to you as well as to go there or should they go to your main website? Jared Ribley: Yeah, but both. ⁓ So capstonema.com or readyforexit.com. Both ⁓ find their way back. Kyle Hunt: And if we were, if we were to kind of rapid fire, rapid fire, just like bam, bam, other, other tips, other ideas. Here's what I see. and, and we were kind of just crank through some other things that are common things that you teach on or that you mentioned, or that you see maybe the biggest misconception owners have about it. Maybe common weaknesses that you see, ⁓ give us some rapid fire, other thoughts that are, that are going because you're, since you're fasting, one of the benefits of fasting is you have mental clarity. Jared Ribley: This is true Kyle. Kyle this is true. Kyle Hunt: You have mental clarity. give us, yes, give us five or six kind of other little tidbits that you are actively talking about related to this topic. Jared Ribley: Well, one, listen to Kyle. Okay, that's number one. Listen to Kyle. ⁓ Tune into the podcast and listen to Kyle. Get the value. There you go. Get the valuation done. ⁓ Make sure you trust the source, but get the valuation done. Take the guesswork out of it. Work with a trusted advisor, create a baseline, get the valuation done, and you'll know where you stand. And then you can look onto the horizon and know how far it's going to Kyle Hunt: Ooh, I like it. Beautiful. keep it we're gonna keep that as one. Jared Ribley: take you or long it's going to take you to get there. ⁓ so get the valuation, ⁓ to go back to what we talked about owner reliance, one of the only ways there's only a couple of ways to really solve for that problem of owner reliance. And it comes down to documentation and then implementation of the documentation. So all that tribal knowledge that you have as a business owner, start learning how to document that, get it outside of your, your mind, your brain. Kyle Hunt: Mm-hmm. Jared Ribley: put it on paper or find the right technology for this and make it centralized so that everybody on the org chart can use it, identify it, it's easy to follow, things like that. ⁓ So documentation, whether it's SOPs or ⁓ policy manuals or employee handbooks or whatever it may be, yes, that is going to begin to alleviate, that's the start of alleviating owner reliance. Kyle Hunt: Checklists, processes, whatever you want to call them. Jared Ribley: and the org chart itself. You I can't tell you how many clients we have where we are their first introduction to an org chart because we need to do that for the presentation when we're going to market, right? And because we need to show that the business is larger than the owner. ⁓ So in org chart, SOPs, et cetera, and not only that, but the implementation of that. And that will start to help alleviate the owner reliance. Kyle Hunt: Now I'll rapid fire add a few other things. One is you want a business that's valuable focus on the team, the team, the team, the team, you've got to make it so that people want to work with you. People want to work for you. People are bought into what the business is about and they want to stay with you for the long term. So much of the value of your remodeling business in particular is going to come down to the longevity and the care. and the culture that you have established within your team and your company. So time spent on that is good in the short term, medium term, long term. I would say also for remodelers, you wanna build value. You've gotta really be a marketing ⁓ and sales and marketing and branding focused company. You cannot go into it and go, well, know, we're 90%. Repeat and referrals. That's good. That's good. That means you've got a good reputation. That means that you take good care of your clients. But if you want to build value into your company and frankly, continue to grow your company that falling in love and producing results in your marketing plan and execution and in a really solid sales process are probably going to be few of those other dials that really amp up the value of your business and frankly help you in the here and now as well. Jared Ribley: point. Kyle Hunt: Excellent. Well, that was fun, Jared. We should do that live in St. Louis for the Elevate Peer Group in 13 days. Jared Ribley: I think we are. I think we will. Kyle Hunt: This will be good. This will be fun. Go to readyforexit.com to do your assessment. One other quick thought. When you say, man, get the valuation. If I'm listening to this and I'm in Massachusetts or Florida or wherever, what would be a good kind of next step for them to figure out? Where do I get kind of the valuation? What do you see people do for that? Jared Ribley: Yeah, it works. So there's a market valuation and a welcome to contact us. We have no geographical barriers. ⁓ If you want to find somebody in your neighborhood, just kind of Google search business valuation local. If you need something for a state planning or court procedure, you're probably going to want a CVA certified valuation analysis. And that's accreditation. That's that's a that's something that I don't have. ⁓ That is the equivalent of like an appraisal. So a couple couple suggestions there. Kyle Hunt: Perfect, perfect, yeah. And just this also kind of ties in with just overall estate planning and that side of things of going, yeah, we set up that trust a number of years ago, didn't we? Oh yeah, we did this. As I just even thought of that, went, wow, we did set up that trust and we did set up how we want all that to look. But I don't think I called, did I call that company to make sure that those proceeds actually go to my trust and not to me? Jared Ribley: Yes. Right, right. Kyle Hunt: Like there's a lot of details in that. So that's another example of you want to be ready for exit. You want to be ready for retirement. Make sure that you're knowledgeable and clear and up to date on all of that trust side of things on your estate plan, on your financial plan, lean into that. ⁓ And that'll be a wise thing to do. Jared, thank you for sharing your wisdom and thank you for sharing it very clearly. And frankly, I hope that some of the people listening to this, biggest takeaway was just our little health related thing because we can't. Jared Ribley: there is. Yeah, yeah, that's valuable. No, no. Kyle Hunt: Can't be reminded of that enough of going, time out, we've got to make sure there's just running a business is stressful. Growing a business is stressful. Living in 2026 in America has a just baseline angst to it. And we need to make sure that we're taking care of taking care of ourselves. And that will frankly make us ready for exit as well. All right. Thank you, sir. Jared Ribley: Yes it is. It does. Amen. Amen. Yeah, thank you very much for having me, Kyle.