Latest / Exit Algorithms / Every Dollar You Spend Costs You 20 at the Closing Table | Joshua Gould (#102)
Transcript
- Pete Vera, Exit Algorithms: Welcome to Exit Algorithms, the podcast where we decode what it really takes to unlock growth, streamline operations, and prepare your business for a high value exit. I'm your host, Pete Vera, and today I'm joined by Joshua Gold. He's the group CEO and co-founder of The Big Word, one of the largest translation and localization companies in the world. He took the CEO seat in 2019 and has led the company through global expansion. and AI driven industry disruption. Joshua is an investor or partner in many different ventures and has received a number of awards, including a Stevie Award and European CEO of the Year. Joshua, excited to have you here today. Welcome to the podcast. Joshua Gould: Thank you for having me, Pete. ⁓ I enjoy doing these podcasts because it's the only time I get a word in Edgeways. I have two girls at home and a wife. So ⁓ thank you for having me and giving me the time and the platform. Pete Vera, Exit Algorithms: Absolutely. Happy to provide the platform. yeah, and I'd love if you could start off, Joshua. Do you mind for people that haven't heard you before? share a bit about your background, maybe some of your business journeys, some of the gaps that I missed from the intro. Joshua Gould: Sure. Well, I merged my company into the big wood two thousand and seventeen to eighteen. And that I was running ⁓ and a defense company. So similar background to you. I ran teams in Afghanistan, Iraq, Syria with the DOD, and the Ministry Defense in the UK and the Allied forces. I merged it into the Big Word, like I said, and then I took over as CEO of the Big Word. And then we sold the whole company in 2021 to private equity. I stayed on. And stayed for a number of the reasons, but one of the main reasons was I genuinely believed in the mission. And the mission to eradicate the final barrier of communication, which is language. And if like you, you've lived abroad and you've worked in these environments, you understand the power of communication. And something that probably was originally designed for marketing. But once you're living it, once you're seeing it every single day, it's impossible to walk away from. Pete Vera, Exit Algorithms: hundred percent. Yeah. I I'd love to talk a little more about that. that equity the private equity exit. Was there any reason in particular, you know, you chose the that buyer? Cause I'm sure you there was many options at the time. Joshua Gould: So let me give the advice that no one dares say, Pete. If you want to sell 100% of your business for cash, sell to whoever is the highest bidder, regardless of who they are. As long as the money is legal, take the money and go. There is nothing heroic about selling to someone at a lower price than you could have got because they are this, that, and something else. If you want to stay, or you have to roll money, and for those who are listening and don't know what roll money is, is quite often a buyer will insist a percentage of the valuation of your company gets rolled into the new company, the new investment. And they do that for a couple of reasons. Number one is it brings down their leverage ratios, which makes it easier to borrow money to buy your company. And number two, it's a bit of an insurance policy, right? Where you're investing in your own company, and that gives them a bit of confidence that you don't think that this is about to collapse. So, know, if you're going to roll, then ⁓ partner becomes very, very important because it is a marriage. And sometimes those marriages end in very messy divorces. So I to stay for a couple of reasons. Number one, I've mentioned I believed in the mission. I was in my mid thirties and I I've got a lot of runway, a lot to give. Part of me, there are many, many mornings, Pete, when I wake up and I think, what the hell did I get myself into? I live in Miami, I have the beach right in front of me, my boat on the back. What was I thinking? At like four in the morning as I'm about to be berated by some government body or be investigated by some auditor. I'm having to get on a flight, and the only seat that I can find is an economy class C and I'm gonna be on there for 15 hours because I've got to get to India. I'm thinking w what was I thinking? I must have really hated myself. But at the end of the day, that's part of the journey. And I think a lot of people don't realize that if you sell your business, it doesn't matter how much money you get from it: 10 million, 20 million, 100 million, a billion. You are quite irrelevant compared to when you are running your business. You know, money is not relevance. by giving it away, you can build some relevance. ⁓ And I think as human beings, we fail to understand that. We sell our businesses because we want financial security, we want intergenerational wealth. There's a lot of reasons why you'd sell your business. But what you don't really think about until day zero, when you wake up the day after you sold it and you're out, is what do I do with my life? And no one is calling you. No one is escalating their problem. And I saw my dad go through that, Pete. He went from being the mayor, from being important. He sold his business that never made a penny. He sold it in 1998. And it was a 25 pounds. So that's 35 million dollar business. And he was out and he woke up and no one cared he existed. And I've never seen him so miserable. In fact, he went through a year of misery until my mom said, Larry, you've got to get out of the kitchen. I can't stand you being at home all day, every single day. I love you, but go and find something to do. he did, you know, and I and I've learned from that. Pete Vera, Exit Algorithms: Yeah. Wow, that's a hu huge takeaway. Yeah, plan plan s step ahead and and picture what it'll be like after. do have any any other advice for for business owners thinking to thinking of s exiting their their company? Joshua Gould: Sure, I think of the ⁓ shocking things that people learn when selling their business is that job radically changes. a paradigm shift. So as an owner, an operator, an entrepreneur, everything you're thinking about is long term. You're not thinking about Your business quarter to quarter, unless you're publicly listed, which then you're not selling your business really. You already sold it. You're thinking long term. You're thinking about developing products. You're thinking about winning clients that may not make profit for years into the future. You're looking at investing in people and developing those people. part of your being, every atom in your body is thinking long term. But when you sell your business, the worst thing that you can do is think medium or long term. You have to think about short term because you're not going to own that business what the day you sell it. And you don't get to resell it. This isn't like a product that you create, like a widget. You get one at selling the stock that you're going to sell. ⁓ you'll hold on, maybe you'll roll and you'll get a second bite of the cherry, but you're still not going to be able to sell the stock that you sold. And what do look for when they value a business? I hate to buryone's bubble. not looking at revenue. They're not looking at gross margins. They're not looking at EBITDA. They're looking at ⁓ one number, that's flow. And when you hear that some tech company got 10 times revenue and had no ebit daar, had no cash, I'm going to share a very interesting secret that I only learned from hanging out with a lot of investors and becoming one. They are proformering your cash in the future. And that's how they value your business. So when people look at SpaceX. They the big investors, I'm not talking about the speculators who just say, I'm not gonna bet against Elon Musk. I'm gonna put 10,000 pounds in or ten thousand dollars into it. But the institutions, the hedge funds, the really clever investors, what they're doing is they're taking growth rates, they're taking the cost base, they're taking the fixed costs, and they're looking at two, three years out, how much cash will this generate? And they're going to make an investment decision based on that. So cash flow is how every business gets valued, whether you know it or not. Pete Vera, Exit Algorithms: Powerful. Yeah. And know, the ⁓ are some maybe some techniques, some strategies business owners can do to to, you know, increase the value of their business with cash flow. I mean, besides of course having clean clean financials, it's a big culprit. But yeah, do you have any other tips around that? Joshua Gould: Sure. So I think you've got to understand you can't go and fire your marketing team, fire your sales team, make everyone work from home to pump up your cash flow. Because buyers aren't idiots. They see through that. cash flow isn't the only number. They're looking at, don't forget, I explained they're proformering cash flow out into the future. They're not just looking at today's cash flow. They're looking at tomorrow's cash flow. So if you think that you you can just take my advice. in a technical sense and just get rid of every single cost and you're not even going to fly to see your clients anymore ⁓ pump up your cash flow. I promise you buyers will see through that. But on the other hand, that's quite extreme, right, Pete? You know, you're either firing your sales team or you're doubling it. You've got to have a look at who you're wasting money on. You know, maybe as a salespeople ⁓ that of used to great. But they haven't really done anything for the last two years, and now they're a cost. Those people should go. Maybe you've got marketing spent that you can't quite tie an ROI to. That should go. Maybe you've got an office space and you're paying $50 a square foot when somewhere around the corner of $20 a square foot would be just as good. You should make that move because every dollar you s you save is going to be multiplied in a sale. So let's say you're gonna get 10 times cash flow 20 times cash flow, which is not abnormal. 10 to 20 is about normal for the average business. So and don't eBit DAR. Is often confused as cash flow. EBITDA stands for earnings before interest tax depreciation and amortized. It's a leading indicator for cash. So quite often people will talk about I got 10x eBit DAR. And when they did, they really got about 20x cash. So let's take 20 times cash. If you're used to traveling business class to your clients, business class to my clients would be about $10,000 ticket. But if I fly that same flight economy, I'm saving about $7,000 a ticket. At 20 times, that ticket's costing me $140,000. So I have a windowless office because I know that when I come to sell my stock again, if I have a nice office with windows and it wasn't in a warehouse, it would cost me about $200,000 more. And that's four million dollars of of value wiped out. And I still own with my family 25% the business. So it's worth saving a million dollars me. And it's no skin off my nose. ⁓ So is mindset you've got to think. The biggest mistake that I see people make is they don't about selling their business until they're ready to sell it. Pete Vera, Exit Algorithms: Mm. Yeah, how far in advance do you think is appropriate? Joshua Gould: You got to think like a private equity, like a professional investor. Professional investor has thought about selling your business before they've acquired it. And they're actively selling it from day one. So what does it actively mean? It doesn't mean that they're shopping it around and hiring an investment bank or a business broker. They're actively preparing the financials, they're actively preparing the documentation, they're actively considering the notes for the board meeting that will come up in due diligence. And they are making decisions based on that. So the best day to start preparing your business is today. Pete Vera, Exit Algorithms: Love it. That's probably a great mini mini episode right there. I I appreciate all the insight. ⁓ that's a yeah, really good way of thinking about it. Those expenses you run through your business are gonna be s you know so much more costly in in the opportunity cost in the future. Joshua Gould: Yeah, you know something funny, Pete. run a call center as part of my business. In fact, a large number of our employees are call center employees, even though we're a technology business and people interact with us through our apps. But we you you can still call up. And I'll walk through the call center and I'll see Uber E' all the time. And I know what these guys are on. They're on a very modest income and struggle. But yet they order an Uber Eats, they go downstairs. We have Starbucks just downstairs. And I ask them, how much is that? And they'll say, just four to five dollars. It's a treat for myself. So we do the math. Four to five dollars times twenty-one times a month. You know, so you now let's you know, now ⁓ roughly at 110-ish dollars. And if I timed that by 12 months a year, you you know, let's call it twelve hundred dollars a year. Next question is did you put it on a credit card? And you know, unfortunately, in most cases, the answer is yes. Are you paying credit card off every month? If it is, it's fine. It's the same as paying cash. In most cases, the answer is no. What are you paying on your credit card? Most people have no idea. The reality is it's about 20 to 25%. So your four to five dollar tree is costing you twelve hundred dollars a year in actual cash, but interest is costing you another two hundred and fifty dollars every single year. And if you carry that credit balance for 10 years, it's now costing each coffee's costing you like 20 to 25 bucks. And you do it every single day. Now businesses do the same thing all the time. Yeah, businesses are like, okay, it's just an extra three or four dollars per square foot for that nicer office space. It's just an extra two hundred dollars for a laptop that's gonna last three years. And then they're going to the bank and they're borrowing money at 10 to 15 percent. You know, so we all do it to an extent and we've all done it. it's not a diss. You know, it's a privilege to be able to pay cash. It's a privilege not to need a credit card these days. But that doesn't mean that the privilege is wrong. You know, so you have to really Look at your business, look at the cost, look at the funding for it, and get to know it. Because I can tell you, most CEOs that I work with have no idea how much cash they're making. They don't even know how much money they have in their own bank account. So this isn't a call center issue. is a cultural issue in the westernized world. Pete Vera, Exit Algorithms: 100% right. Yeah, I I haven't made that analogy, but tot totally true. It's exactly applicable. man. So you you've had to change roles several times in in your career. we talked about changing roles earlier. I'm curious, ⁓ how has your role You know, as as you were growing and scaling, let's go back, you know, ⁓ before you your exit. how did you keep your ⁓ company culture as grew the the business? ⁓ to different countries, different languages. and you know, what what kind of role did you have to step into? Joshua Gould: Yeah, comedy culture's an interesting thing. I think a lot of inadequate CEOs spend a lot of time on culture because it's kind of a nice place to hide. And it's something that's a people pleaser. don't think about culture ⁓ much. I think about leaders a lot. And leaders will automatically dictate culture. You've seen it yourself, Pete. You've lived in Italy. I don't think Italians are thinking about Italian culture very much. I think they just think about cooking great food that they have known for centuries. I think they think about religion a lot and being spiritual and trying to do the right thing. It's the same in business. you have A leader who's eternally optimistic, who looks at opportunity rather than challenge, who sees failure as part of success, that becomes the DNA of the business and that becomes the culture of the business. And I really believe that. So when we were growing, I would always look first at the ethos of the individual. And I hire based on that. Is this person able to have a really difficult conversation with me? Are we able to gonna vehemently disagree and then still go to the pub afterwards and watch the football or the soccer as you would call it? You know, are they going to be able to have that same conversation with their staff? Do they really care? About our mission? Are they gonna live it? Are they gonna breathe it? Are they gonna be able to tell the story? Are they gonna be good communicators? Because it those are the things that people say of the big words culture. You know, that we are caring, that we are optimistic, that we are risk takers, that we Really believe in engineered performance when it comes to our technology. That we do things that no one has ever done before in the language industry. We think outside the box. We're problem solvers. You can call us at two or three in the morning. That's not some culture. I hire people that are prepared to take a call at two or three in the morning. And they're hard to find in Europe. Pete Vera, Exit Algorithms: Yeah, definitely. Yeah, I was gonna say, how d how do you go about finding those those A players, you know, the the people that you want to be leaders in your business? Joshua Gould: I'm always recruiting. I never ever stop recruiting. Even when I can't afford it, I'm still recruiting. And find a way. For the right person, I'll always find a way. And I think that, you know, I have so many friends and they tell me, how do you build a sales team? Everyone I hire is terrible. They cost loads of money. They never sell anything. And I said, well, that's just part of it. Like, I don't have your expectations. I'm gonna hire five people who I think are absolute killers. And one of them is gonna be a killer. But I'll hire five people and I'll go without. You know, when I had my first child, I was seven or twenty-eight, and ⁓ business was doing really well. And bought this house just outside of Manhattan. I l used to live in ⁓ New York and we moved to New Jersey when my wife was pregnant. The house was amazing. It had a swimming pool, one acre of land. You know, I know that's not a lot for you in in Hilton Head, but of Manhattan, one acre's pretty big. But we couldn't afford furniture. Now, the company was making millions of dollars on paper. We couldn't afford furniture. So we went to all the garage sales and we filled. Our amazing home with used furniture. I didn't feel sorry for myself. I didn't think this would be a great story to tell one day on a podcast. It's just what I needed to do. And I put that money into salespeople. I didn't have an expensive car. I had a car that was probably less than average. I still, by the way, my car cost me $417, including tax, and I got the nice wheels and the cool paint job. Because the money goes into the business. You know, every time I've made a lot of money, I bought myself something to reward myself, something that's great. But I don't go and upgrade everything. You know, so I bought myself a boat last time we sold. That was my dream in life. I always wanted a boat. I love the water. And I'm very lucky to have that. But the important thing is put the money back into your business. But the day you are ready to sell it. And you should be thinking about this right from day one. That is when you make short-term financial decisions because you're going to get a valuation based on the profit and the pro formaed profit for the next year or so. Pete Vera, Exit Algorithms: Love it. Yeah. I mean, you're you're going against the lifestyle inflation. I you could argue all those cost savings that you do over the years and years. you're weighing that versus potentially buying a boat, right? Joshua Gould: Yeah. I don't have any inflation in my life. I I think that if you are on minimum wage, you're a flag in the wind and it's very unfortunate and you're probably really suffering right now from incredible inflation. However, if you're a middle class listener, inflation's a choice. You know, I had a Corvette, I kept it for seven years, I sold it for pretty much the price it cost when I bought it. I it out for a a ⁓ a three Tesla. Didn't cost me any more than the Corvette a month. I didn't have any inflation over those years. go to the supermarket like everyone else, and I'll shop and I'll sometimes go to Costco. I sold my in ⁓ New Jersey. I moved to Miami. I bought it for I bought a cheaper apartment than my house. I then put the money into investment property, and the money I get from investment property pays for the increasing price of insurance, which is technically inflation. HOA, but it's not costing me any more money. And I honestly think that, you know, everyone treats the government like their rich uncle. If they're not getting money from them, they're upset at them. You know, that you know, we're all looking at what we can get. And I want to give power away like that. So I I think the businesses have to look in the same way. In the last seven years, bought down the unit rate. And I I'm a government contractor, Pete, so my client is ultimately the taxpayer. And people I sell to ⁓ care greatly about getting a good deal for the taxpayer. In the last seven years, my unit rate has come down 30%. In the same time, inflation is up over 30%. So I'm essentially giving a 60% discount. To the taxpayer, because I've done exactly how I live my normal life in my business. And I've been able to grow as a result of that. My top line revenue, despite giving these huge discounts, has grown because I'm eating everyone else's lunch, because I am able to use AI and automation to drive down the price. Offshore call centers drive down the price without driving down quality and quality of service. And You know, a a and that makes me more investable when I come to sell the business because I got more protection against inflation and outside influence. Pete Vera, Exit Algorithms: Yeah. Yeah, l love your mindset on on that. I think it's no winning mindset there, Joshua. yeah, do you have any advice for business owners wanting to themselves as as the bottleneck in their business? Joshua Gould: Well, yes, is a short answer. First of all, I should just caveat all my advice on today's podcast is my opinion. You know, people make the mistakes of listening to these podcasts and thinking because someone did it that way, that's the only way to be successful. There are many different ways to be successful, and everyone should take what someone says on a podcast as an opinion, and that's it. It's not fact. But my advice for any business owner is When you are the bottleneck, you have to then be priced back into your business. And that's going to affect your cash flow in the future. And it's also going to increase risk. So they're going to do something called cash flow discounting. I'm going to give you an example of this. Let's say you're a plumber and you've got five trucks you're doing five million dollars a year. In revenue, and you're doing 30% margin. So, you know, 10% that would be one and a half million dollars in gross margin. And ⁓ your margin, you're making five hundred thousand dollars in cash flow profit. When people look at that business normally, they're probably gonna pay four to five times your cash flow profit. Because they're going to say, well, you've got nothing unique. It's not a very defensible position. You're susceptible to the economy. So four to five times cash flow for a plumber is pretty normal. So if you do the mass, you know, at five times, that would be 2.5 million. It's a lot of money. But if you are the bottleneck and every client knows you, and ⁓ answer every phone and you do every single quote. Put yourself now in the shoes of the buyer. That's a big risk. And what I found and I invest in these small businesses, typically when that's the case, I'm gonna lose 50% of the revenue. So I'm not gonna do 5 million, I'm probably gonna do 2.5 million. Now I've got fixed costs. So I'm not gonna lose 50% of the profit. I might lose 100% of the profit because I've still got just as many vans. I've got fixed costs. That aren't going to reduce in line with revenue. They might reduce, but not in line with revenue. So now, how much is that business worth? Well, it's probably worth nothing. And that's how buyers look at you. Now, let's say it was a $10 million business, and you're going now from one and a half million to one million of profit. You've just left five hundred thousand dollars of cash flow on the table. And once you times that by five, you've just left two and a half million dollars on the table. So wouldn't it have been better to hire, you know, some kind of person to do the quotes and another person to manage all the the vans and people going out and paying them, you know, $75,000 each, which means instead of half a million dollars, you're making $400, well, $350,000. But then you might be able to say it's scalable, right? You can then go and scale it and you'll grow the revenue quicker. And you know, and the likelihood is is that you wouldn't be doing five million a profit because now you've got a lot of time to scale up. You might be doing six or seven million dollars of profit. So the you've really got to think about your business is as a saleable asset. If you are your business or you are or your business is your job, it's not that saleable. And people will discount the cash flow. In other words, they'll take the cash flow that you give them and they'll say, When I'm running it, I've got to put costs in, and I'm going to discount that cash. And I'm going to give you a multiple of that. So a lot of entrepreneurs love being their business. They love it. It's their hobby. But it is, you know, negative to the valuation of your company. And I think, you know. It's something that you really seriously want to look at. Now, some people, if you ask my dad, you'd be like, I don't care. It's my fun. I'm loving life. I'm enjoying it. And that's absolutely fine. But just know that it's going to cost you of what you're actually saving. Pete Vera, Exit Algorithms: Yeah. Well said. awesome. Glad I glad I asked that question. Okay. Last last topic or theme, anyways, is ⁓ I want to touch on AI. You mentioned AI automation earlier, just ⁓ as a you know one of your processes to as you grow and scale. I'm curious, you know, how are you using leveraging AI the most these days, personally and professionally? yeah, how does how is it affecting the the business landscape as you see it? Joshua Gould: So I started selling commercially in 2006. AI, by the way, for those listening, is the rebrand of something everyone else called machine learning a long time ago. And it's and it's been in existence for a very long time. In fact, since the 60s. So, you know, a lot of ⁓ who build AI and invest in AI, like me, will talk up AI. So that we can get more money for our businesses because it's all part of the story. But I sold AI in around 2006. we used to reuse previously translated content and figure out whether it was within context using AI. And my biggest client, Pete, was Honda. And when we started applying this AI, we lost 70% of our revenue overnight because we could reuse 70% of their words. You know, if you got if you've ever read a car manual, you're probably over the age of 40 if you have. But if you've ever read a car manual, you'll notice that they're nearly all identical. And that's, you know, that was a problem for us. So we AI and it was a choice. And we went to Honda and said, And I and we flew to Japan and and we said we're applying this new technology. We didn't call it AI, we called it machine learning. And it's gonna how much we can charge you. So we wanna charge you ten percent for the tech. And 30% for reviewing it, the human review of the AI. And the rest we'll give you for free. And Honda were incredibly thankful. And they said, you know what? We're only sending you a very tiny amount of work compared to what we want to send you. We just didn't have the budget. the next year the Honda account doubled. And the next year it doubled again. And we did the same with G. Back in those days, we were the big word was actually selling not to government but mainly to companies as big as countries GDP so as big companies and then in 2013 Google and we work with Google on this we came up with mural machine translation and in fact it's still widely used today and favored over large language models which I'll come to in a second So when people talk about ChatGBT, which is OpenAI's product, or Claude, which is Anthropic's product, they're talking about machine learning, and specifically they're talking about neural machine learning. That's what it technically is. what we did in 2013 was machine learning, but it was all based on what we call corpora. So I'll try not to get too technical, Pete, but essentially think about this. It it it corpora is just content that you've scraped that you've previously translated, and you can use it to tune your AI. ⁓ we did that, and it w it's spectacular. And the results are. incredibly great. And the same thing happened that happened with Honda. We went and the price dropped tremendously of our spoken and written word. And we were deploying Voice recognition and all sorts of other technologies at this point. But people were, you know, just getting used to now communicating in their own language. So they expected it. And in the past, you would look at a website, it would be translated, but then you'd call up the company. You wouldn't expect to speak your own language. You'd have to speak in English. Now they expect it. More recently, we've seen you know what we now call AI. ⁓ Which is large language model, machine learning, and specifically neural machine learning. this is where it just learns on everything, everything on the internet. And here's an interesting fact: the amount of content that will be created in the next 12 months, just the internet, so only digital, will be more than humanity has created in our entire existence. So this just booms the amount of content that's out there. And about 1% of all translated content, whether it's spoken or written, will be paid. The rest will be free. That 1% is driving 6% revenue growth in our industry, which is language services. This is a very long way of saying when you give people technology and access. ⁓ What you see is the market explodes. You can apply this to nearly every other market. Another example I like to give is the telephony market. I used to run my entire business, still do from my cell phone. I barely ever open my computer, know, unless it's a podcast like today. And my my cell phone bill until fairly recently was $2,000, $3,000 a month. And then VoIP came along, and my cell phone bill was $75 a month. Unlimited usage. Great. You would think the ATT, Verizon would go out of business, but have a look at what happened to their revenue when their average unit rate plummeted from a dollar a minute to now, you know, pennies on the dollar. But their profitability went up because everyone got rid of their house lines. Pete Vera, Exit Algorithms: Mm. Joshua Gould: Yeah, you know, I don't know anyone apart from my step grandmother who's still alive that uses a house line. Even my parents don't have a house line anymore. So maybe you've got one because you had to buy it as part of a bundle, but I think you don't have a phone in it. So my kids don't even know what a house line is and they're teenagers. They honestly have never seen ⁓ the I think they've seen them in movies. So this is what we see happening and ⁓ ⁓ Pete Vera, Exit Algorithms: Yeah. Joshua Gould: Think there are two types of AI. There is end product AI. So for me, that would be AI interpretation and translation, so spoken and written word. And then there is AI agents. And this is where you are essentially creating a digital robot of what you do. So I have created a whole army of digital robots in my business. And I have got my cost base down. To produce minute or word of interpretation and translation by about 75%. And pass that cost saving to the taxpayer. And that's why our revenue is exploded. That's why our profit has exploded because it's gone up in line with the revenue. If you not doing that, I promise you, your competitors are. So AI shouldn't be feared. But It should be if you're not prepared to build it into your into your business processes and what you are doing. And trust me, it's real. It's happening. It's not a revolution, but it is an evolution. And when you come to sell your business, if you haven't built it in and you haven't insulated yourself, you're probably at best going to devalue your business substantially because they've got to build in that RD. and the risk associated with it. I would go as far as say Pete, most investors won't touch a business, no matter how good it's performing today, if they're incorporating AI into their company. Pete Vera, Exit Algorithms: Yeah. Wow. Man, we're almost out of time here, Joshua. Tons of tons of great advice. last question, you know, if ⁓ with all this in mind here, if you had to pick one practical tip for business owners wanting to maximize their exit value, what would it be? Joshua Gould: I'm really glad you asked. And if your listeners remember this one thing from the interview, then well ahead of the rest of the game. And that is have a clean set of financials that are audited every single year. I would say not nine out of ten, but nine point nine times out of ten. I look at a business to invest. And I think it's a great business. I have to walk away because they don't have clean financials and I cannot work out or trust the profit and what it's really worth and therefore the valuation. So make sure single year you have something called a PL, profit and loss. Make sure you have a balance sheet. Don't do it yourself. Pay an accountant to do it and have them sign off on it. You don't have to have KPMG half a million dollars signing off. You can have accountant sign off. I have reviewed the books. I looked at it. I have built these and I'm signing off as their accountant. Have that every single year. And then when you come to sell your business, you're going to create something called a data room and you're going to be able drop all of this in there. If you don't have that, you could have done everything else right. But no one's going to believe it and therefore you're not investable. Pete Vera, Exit Algorithms: Well said. Man, love this conversation, Joshua. Definitely one of my best ones. So relevant to the audience here today. the best place they can find you, your content, and learn more? Joshua Gould: So I put out my own complimentary podcast and it's nowhere near as good as yours or prof as professional as yours, Pete. But maybe we'll have you on it when I start opening it up to interviews. It's called Execcraft and it focuses on some of the things that I've talked about today. If you want to connect with me, please connect with me on LinkedIn. You know what to do. Joshua Gould, you can put the big word in there and you'll find me. And this, you can probably tell, Pete, I love doing this. ⁓ I'm excited about it. I love chatting about it and, you know, make myself available to your audience. And thank you very much for having me. Pete Vera, Exit Algorithms: Leave that in the show notes. Great, great having you on today, Josh. I love this conversation. Joshua Gould: Thanks a lot, Pete.