248: The Guide to Choosing a Business Recipe that Works for you (And 1 type of business you’ve never considered)

Dru Carpenito 00:00
The easiest way for me to describe it is they end up crossing this chasm, mentally. They just kind of have this thought that I'm not happy in what I'm doing and I feel like there could be more opportunity for me, but for whatever reason, I'm not finding it in the corporate world.

Introduction 00:20
This is the Happen To Your Career podcast, with Scott Anthony Barlow. We help you stop doing work that doesn't fit you, figure out what does and make it happen. We help you define the work that's unapologetically you, and then go get it. If you're ready to make a change, keep listening. Here's Scott. Here's Scott. Here's Scott.

Scott Anthony Barlow 00:45
Okay, so what happens when you know that you want to run a business and you know, that's one of your goals. However, you really aren't that interested in spending all of the time to make all of the decisions to come up with every little thing about that business, you don't want to have to reinvent the wheel, but you do want to be your own boss, and you do want to be able to run something that is important and meaningful to you and helping people in a way that you want to? Well, what then? Well, it turns out that that's not the case for every business. So we wanted to create an episode that helps you understand what types of businesses are right for that situation, what aren't. And if you've ever had the thought that you might want to own a business, if for your next change your next transition, and that's a part of something that you want in your world, well, then I think you're going to love this next guest.

Dru Carpenito 01:43
For those that go on to be the happy and successful business owners and franchise owners that I've worked with, the easiest way for me to describe it is they end up crossing this chasm, mentally. They just kind of have this thought that I'm not happy in what I'm doing. And I feel like there could be more opportunity for me, but for whatever reason, I'm not finding it in the corporate world, maybe it's politics, maybe it's bureaucracy, maybe it's the wrong fit, whatever, right, there's a lot of moving parts in the corporate world to find a role that might help them thrive and tap into the potential that they feel is inside of them.

Scott Anthony Barlow 02:18
That's Dru Carpenito. And I wanted to bring Dru on, specifically because he has a really very unique job. He helps match people up with franchises that fit what they want, fit their goals, and fit their world. And first of all, this is a pretty cool job too. But it's near and dear to my heart too, because part of the way that I learned to run businesses and learn to help other people run businesses was I actually owned a franchise. And when a lot of people think franchises they think of, I don't know, the McDonald's or Burger Kings of the world. But that's not even what we're talking about here. There's so many things that most people don't even realize are out there. And I wanted to be able to invite Dru on with his really unique set of experiences to talk about what types of illnesses are right, for different people with different goals.

Dru Carpenito 03:09
But it was completely accidental. What happened with me is my story is back in, I graduated from grad school with a master's degree in Industrial Organizational Psychology and was going to go into human resources and kind of take the traditional corporate route and started working for a great young, great company straight out of grad school. And you have this very charismatic, entrepreneurial founder and CEO and gonna do great things and help the employees be the best employees they can be and all that good stuff, right. And then three months into my career, I'm faced with a career change, which they don't really teach you about in grad school or undergrad, right.

Scott Anthony Barlow 03:45
No, they don't.

Dru Carpenito 03:47
What happened was, Jeff, the founder of the company, decided to take a shift in his expansion strategy and franchise, his business model. And so it was something he had thought about for a long time, this wasn't just kind of an overnight decision. I just happened to join the company, right around the time that it made the most sense for him to start this strategy. So what that meant was, he started to sell off some of the company to existing business owners who were going to run the business model as a franchise. And so that decreased the amount of people that were in the company. And so the need for Human Resources decreased significantly. So Jeff kind of said, "Hey, you can stick around for this franchising thing and be with the team and learn it. Or, you know, we can find another role for you, but I just don't really see that much need for human resources based on the direction the company's going." So I took a couple days thought about it. I did some researching on franchising, because I had never really heard about it, you know, I kind of thought, hey, it's chick fillet a McDonald's. I mean, I didn't know anything about it. And so I did some research, and really started to kind of peel back the onion a bit and was surprised by how much opportunity there actually is in franchising outside of the food space. And so that was my research. And then Jeff, candidly, he was a cool, dude. I mean, he was a good guy to work with and he had that charisma and I said, "Hey, you know, I was young, didn't have a family. So yeah, let's check this thing out." Then that mark, that started an eight year run with advantaclean, where I kind of became Jeff's right hand man. And I was totally overpromoted. And he gave me way too much exposure and experience early in my career, but I was able to kind of run with it and figure it out. And a lot of it was due to just kind of picking up some mentor, right, and just asking people for help who had done this successfully. And anyway, long story short, we figured it out. And we're able to expand the company, which the name of the company is advantaclean to a couple 100 locations throughout the US in eight years. Wow. So through that eight year period, I learned a ton. But that is where I learned franchising.

Scott Anthony Barlow 05:38
So I mentioned at the beginning, you know, this is near and dear to my heart, because I actually and I'm not a lot of people realize this, but part of the way that I ended up learning so much from coaching to marketing to, geez, I don't know, you name a business skill, and really came from this experience. I owned a franchise. And that was kind of the entry to my career, I owned it actually, the part that maybe a little bit different than most people is I owned it at the same time as I was going to school. But honestly, everything that ended up coming afterwards came from that. And it was so much of an immersive type experience with a lot of the support and pieces that I just didn't know anything about that it was a really interesting way to get into my first business. So for you, I'm curious what that experience was like, as you started sort of on the other end, you started on the company side of that, I guess that's probably the easiest way to call it. How do you think about that?

Dru Carpenito 06:36
Yeah, absolutely. I was on the corporate side, of the company side. But what happened through that eight years, and then I went to work for another company, that's international work kind of doing a similar thing, just just internationally. What happened was, it was a very entrepreneurial opportunity within the company, because it was a white space, but we just... we had to figure it all out. So I kind of mentioned, Jeff gave me a lot of opportunity. And I was able to figure a lot of it out with the help of the team and everything. But what ended up happening is I ended up recruiting and helping or playing a key role in helping a lot of the franchise owners that came on board to open and advantaclean around the country. I helped them get into the company, I helped them, I'd help train them, I would be out in the field, working side by side, helping them to build their business and teaching them. So I became an expert in starting advantaclean businesses, which I helped other people do. And it wasn't just me. I mean, there was a whole team of people, right. But just as it relates to my experience, that is where so much learning happened for me and I met so many great people from all walks of life, most of which were corporate refugees, believe it or not, coming from the corporate world that had no experience with anything remotely close to what advantaclean did. But we weren't looking for people who wanted to be out cleaning stuff, right? We wanted people that were good business folks that could build a team of people, could go and develop relationships that fed the business to their local business. And then we did a lot of back end things to provide a tremendous amount of support to help the franchise owners a lot of times on the back end to run the business more efficiently than they could on their own. So I mean, I literally helped 100 people start advantaclean. So I feel like I started the kind of 100 advantaclean to myself, to a certain extent.

Scott Anthony Barlow 08:10
It feels like that.

Dru Carpenito 08:11
Yeah, and I just I learned so much from everybody, because everybody had a different story. And everybody had a different path in life as to why they decided to make a career change and open up their own business and how they figured out that that opening a franchise number one was a fit. And then number two advantaclean was a fit. So it was a pretty cool experience that has helped me get to where I am today. And everything that I do when I work with folks individually here to help them figure out which might be the best path for them. entrepreneurially is based on all that experience of helping 100 advantaclean franchisees open their own businesses. And then I had the opportunity to go to work for an educational company that was worldwide. And I got to help people around the world open businesses from Australia, to the UK to Latin America, to South Africa, and I had never in my... I'm a guy from Wilmington, Delaware, right. And I'd never thought I'd be helping people start businesses around the world. So that's the experience that I rely on when I'm, you know, working with somebody to help them figure out if business ownership might be a good option for them to explore and a franchising might be a fit for them.

Scott Anthony Barlow 09:10
Well, just knowing a little bit about your background, too. I don't think people realize like how much goes into it. When you said earlier, I felt like I helped start a you know, 100 different franchises. And that was just the beginning of your career. I have also worked on the company side of the franchise equation as well. And in some ways, I think it's actually, you end up learning a whole bunch more because you're seeing both sides of it because you're right their boots on the ground, like helping them literally get started and feeling that side of it. But then you're seeing all the other sides to across many, many, many different franchisees as well in many, many different business owners and all the different reasons why they got into it and everything else. So I would say that compared to if you literally did go own 100 franchises, it gives you an even better set of experience having done both sides of that. And I know that sounds probably really weird. But here's the question I wanted to ask you about that, since you've been exposed to a lot of different people that get into business ownership, get into entrepreneurship, and are in kind of that been beginning stages where they may not have owned something before, I'm curious, what are some of the reasons that you see most common for why people are interested in getting into that, as well as, who makes a great entrepreneur in some ways, especially from a first time perspective?

Dru Carpenito 10:32
It's a great question. And I think, I believe that everybody has their own journey, in terms of the people that I've worked with on franchising, and I've worked with 1000 people that have decided that opening their own business was not a fit. And so, you know, it's not for everybody, but for those that go on to be the happy and successful business owners and franchise owners that I've worked with, the easiest way for me to describe it is, they end up crossing this chasm, mentally, from I believe that we're groomed from a young age to believe that there's a traditional corporate career, right, you go to school, you get good grades, go to college, go get a job, and sock away 10% in savings work for 40 years and retire, right, that's kind of the traditional w two path that we are groomed to and I was groomed to. And I thought I was gonna go down that path until, you know, I took the crossroad that I did, which opened my eyes to a lot and that there is a different way and so, but for folks who are find it to fit for them to go on to be happy and successful, they figure that out in their career, once they have this, they just kind of have this thought that I'm not happy in what I'm doing. And I feel like there could be more opportunity for me, but for whatever reason, I'm not finding into the corporate world, maybe it's politics, maybe it's bureaucracy, maybe it's the wrong fit, whatever, right? There's a lot of moving part in the corporate world to find a role that might help them thrive and tap into the potential that they feel is inside of them. And then a lot of times it's completely accidental, kind of like me like franchising found me completely accidentally, maybe they hear a story once they kind of have this thought bouncing around in their head, like, is there another way that I could go about my career and is business ownership the path? And then a lot of times, it's kind of a word of mouth thing like, "hey, maybe you should check out franchising" or "hey, I had a buddy that left and went on to invest in massage businesses, and he doesn't do massages, but he has, you know, he owns three of them. And he works like 10 hours a week." People hear stories like that, and then they go to the internet, they do some research, they might find me or whatever, right. And a lot of times there's a seed that's planted when they cross this mindset. And when they cross this chasm mentally, where they kind of shift from the traditional kind of employee mindset and start to kind of get into this entrepreneurial mindset, where they start to view the world and opportunity in their careers a little bit differently. And then it's about just kind of getting connected with resources to help them figure it all out. And then ultimately, if they find something that's a fit, then they kind of know it, because they're in the right mindset. So it all boils down to mindset is what I guess my point that I'm trying to make, for those that don't cross that chasm in their mind and do invest in their own business or do invest in a franchise, which happens, those folks figure out it's probably not the best fit for them. But I've seen that too.

Scott Anthony Barlow 13:18
That's interesting. What's an example of kind of both sides? I'm curious.

Dru Carpenito 13:23
Well, I just finished working with an individual. I'm in Charlotte, North Carolina, and he's here in the Charlotte market with me. And Charlotte is big bank in town. So he's been a very, very successful banking executive, throughout his career, I mean, on paper, you'd look at him and say, "Holy moly, like this guy hasn't made." But he kind of started to get that itch and feel that lack of fulfillment, even though he was, you know, on paper wildly successful. So he got referred to me, we had a conversation, I remember the first conversation we had, I said, so you know, "Talk to me a little about kind of what's going on? And do you have a timeline in terms of the transition that you might be under if you found a business that might be the fit for you?" And he said, "Yeah, it's three years." I said, "Okay, well, that's a long time. Let me give you a couple things to think about." And I was with his wife, was the three of us, him, his wife, and me. And I said, "Maybe you guys can talk a little bit more." And what had prompted him to reach out to me was he had a former co worker who had left his role as a successful banking executive and invested in multi unit franchise opportunities. So he was running multiple locations, and working about 10 to 20 hours a week. And so the guy I was working with saw that and said, "Hey, that was kind of his enlightening moment." I said, "Hey, maybe this is a different path from you."

Scott Anthony Barlow 14:32
There's got to be a better way.

Dru Carpenito 14:33
Yeah, exactly. Because what was happening was he was getting up at 5am, he was going to the gym working out getting to the office, you know, sitting in traffic for an hour, get in the office at 7-7:30 working a 12 hour day, sitting in traffic, coming home, to get with his you know, be with his family for an hour before you know they had to get homework done and go to bed and that was what was grinding on him. And that's what was making it not worth him feel like maybe this isn't worth it, even though I'm getting paid a ton of money, right. So half for our first meeting, it was a three year timeline. And the next meeting we had, he had moved it up to a year, I said, "Hey, what happened?" And he said, "Well, as I've been thinking about this and doing more research, and the more and more I go into the office and live my weekly life, the more and more I hate it, and I just don't want to keep doing it." And so we started to kind of put together a plan on how to help him really start to do some research and look at businesses so he could kind of figure out that year long plan. And then, you know, within six months, he had found a business, quit his job, and now he is happiest can be owning a franchise.

Scott Anthony Barlow 15:33
That's so funny, we see that same curve that he went through, where it's like, "Eh, no, I'm thinking about this, like three years in the future" what has a tendency to happen, and we see this, whether, regardless, whether somebody is wanting to pursue their own business, or whether they are making another type of career change, like they start to realize what's possible in another situation, and then that creates additional discontent, because now they're not only unhappy in their job, they realize that there's only so much that's in between them, and what they really want to be doing. So that's really interesting. And in terms of, of course, he's going to speed up the timeline. And that's awesome, by the way. So what ended up happening there?

Dru Carpenito 16:12
So it was funny, so he found a business, made the investment, and he kind of put a plan together to transition out of his job, because when you invest in a franchise, I mean, it's a 30, 60, 90-day process to even find a franchise do the due diligence on it, which I can talk to more about. But then after that, right, there's a whole opening process that goes into place too, that could be 3, 6, 9 months, right? So a year can be taken up pretty quick in terms of how you want to do it the right way to give yourself a nice long runway. But he found the business, made the investment, went to tell his boss that he was leaving, as his boss was coming to tell him that he was getting like two band promotion. Gets faced with this like ,life changing promotion, right. I mean, it was even more money, but it was more travel, it was more work. And it was more of what he didn't want to be doing. And all the money in the world, just he would not have satisfied him because he had just mentally, you know, he crossed the chasm. I mean, he was there, he had done the research to figure out and find another path that would enable him to be happier. And also provide him a heck of a lot of opportunity financially, right, in terms of what he could build and control. So he gets this promotion offer. And he's like, "Hey, I need to tell you something. I'm respectfully gonna decline, because I'm leavin" and his boss just... he told me he just went ghost white. "Like, what? You're turning this down?" And he did. And I hang out with him all the time. And he's just happy as can be right now and love in life. And it's very cool to see and to play a small part in that right is, that's what I love doing. I just I love helping people. I love small business. I love entrepreneurship. I love helping people explore it, because it's fun. I mean, there's so much out there that I think a lot of people, you don't always realize, because you're never really taught about it, right? We're never really formally taught about what entrepreneurship is, and what it isn't. So, for me just to help people learn more about it, and to help them to be a guide for them to figure it out for themselves, that's what just makes me happy and excited. And I absolutely love it.

Scott Anthony Barlow 18:13
That is awesome. And it raises a few questions for me that I think that you're especially qualified, uniquely qualified, I'd say in a lot of different ways just based on your experiences to be able to answer. So let's say for a second, cuz we've got a lot of people that as they're listening to this, we have many folks that are interested in owning their own thing, doing their own thing, having their own business, someday, a lot of them don't necessarily know what that could be, or what that might be. And there's... to be fair, and there's a lot of different routes that you could go. So we've talked a little bit about franchising, because that's sort of your background, it's my background, like that's how I came to be. And where I got the really cool opportunity to learn a lot of the stuff that I've learned over the years. But let's evaluate a couple different ways that people could go into this if they're interested in doing their own thing, acquiring a business or starting a business in any of the variety of ways. What are some of those ways? And can we kind of tear them apart for a second here and say, okay, what's the pros and cons of each one of those, you know, who is this good for? Who is it not good for?

Dru Carpenito 19:24
Absolutely. What it boils down to, in my opinion is you have three options, you can start a business from scratch, kind of like you've done very successfully. You can buy an existing business, you know, business that somebody else has built, who's ready to exit for whatever reason, and we're number three, you can invest in a franchise. Can I go back to the first one, starting a business from scratch. Characteristically, this option has the highest upside for any individual. It also comes along with the highest risk, just because, you know, yep. And I mean, there's no limits, right, to what you can build. That most end up and people see the Mark Cuban's, they see the Richard Branson's right, like, that's not. I mean, those guys are in a world, all of them to themselves. You know, we're talking about, you know, building successful small to medium sized businesses is what you know, most everyday folks is kind of, you know, what they're thinking about. But when you're building a business from scratch, you know, you are the one that has to figure it all out in terms of putting everything or from around, you know, from all the learning, that goes into figuring out the value proposition and kind of what's the sweet spot, and what lands on people to layering in systems and software and technology and people on the back end to build the business to a point where it can continue to scale, right, depending on kind of what... I bet you, you're more qualified to talk about this option than I am. But yeah, you know, so for folks who are, you know, I call them kind of true blooded entrepreneurs, and that creative aspect, the build, the, you know, the build something from scratch idea, just gets them excited. And the opportunity is limitless, then, you know, those are the folks that in my opinion, the start from scratch opportunity can really be a good fit for, you know, just kind of those trailblazers, almost, you know, they kind of have that mentality.

Scott Anthony Barlow 21:30
Yeah, and to add some color to that, too, in terms of what you're talking about just having been in a couple of different worlds with a couple of different types of businesses and been the owner of those and interacted with lots of other people too, like what you said about when you're starting from scratch, and you've got to establish all the systems and everything like that, like, the first people that we brought on board for, like, we literally did not have a way to bring them on board, we had to like go through and we had to spend many, many, many, many hours, like creating a checklist to bring them on board and thinking through all those things. And that's I think what people don't see when they're looking at that start from scratch option. I personally love that. But I recognize that most people would not love that.

Dru Carpenito 22:15
Yeah, you know, I again, I think it kind of goes back to mindset, right, kind of what people's mindset is when if they cross that chasm, right? So, again, you know, for the... just those... the people that love the idea of creating something from scratch, this option could be a really good fit for them. The next option, buying an existing business, which you know, somebody else has created and built successfully. A lot of people kind of consider this option the safest right. And the reason that people think it's the safest because it has cash flow, theoretically, however, it's the most expensive option, because you're paying a premium for what somebody else built. And it's extremely complicated to do the due diligence, to in fact, to verify that the numbers in the cash flow or whatever it is that you're paying the premium for, is in fact accurate. And I'm not saying that business owners mislead people, I'm just saying, in the world of small business, you know, you enter small business accounting, and small business accounting, in and of itself is, you know, dedicated career for accountants and whatnot. But there are a significant amount of advantages that people have when they own a business in terms of using pre tax money to legally pay for owner benefits and whatnot, that might not be actual true operating expenses in their mind. But as a potential buyer, you know, somebody might classify certain things that an owner deducted from the business or took out of the P&L as operating expenses, right, so how somebody values the business at the end of the day, you know, values only what somebody else is willing to pay for something, right? So, a lot of times with an existing business, there's so much emotional equity, that the owner has invested in the value of their business, whereas a buyer is going to be looking at it and saying, "Hey, I'm looking at this very objectively, I don't have any emotion tied into this thing" and to go through the process end to end, to try to find a middle ground where people can agree on a value is a lot easier said than done. And so you know, when you're looking at buying an existing business, you know, having a team of people that can help you do the due diligence to in fact verify the numbers and tie everything out to a tax return and all this stuff. I mean, a lot goes into it to make sure that you aren't overpaying for business and the business is in fact what has been presented to you. So my point in all this is it's complicated, and for a first time business owner, sometimes it can just... it might not be the best option for them, because of all the complexities that go into it and the expense right, of what some of the premium that you'd have to pay for somebody else's cash flowing asset that they've built.

Scott Anthony Barlow 25:12
So this might be right for somebody who either is not a first time owner and has specific interest in a particular business it sounds like or the other thing I'm gleaning from what you said is that somebody who either is willing to bring on a team of people to analyze the numbers within the business, because that's incredibly important. By the way, we did another episode specifically on this one option for business back, probably about a year and a half ago, happentoyourcareer.com/166 will get you to that episode with more information on acquiring an existing business like that. But it sounds like from your perspective, and I totally agree with this in terms of they must have either a pretty extensive background in understanding the financials and being able to sort through the financials to really understand if this is a great investment, and probably also understanding of that particular market as well. And if you don't, you need to be willing to hire a team of people to help you understand that. Is that right? Who else would this be good for?

Dru Carpenito 26:11
Yeah, I know, I think you said it perfectly. You know, a lot of times existing businesses are bought by other business owners as a way to diversify or expand their business as well. So for entrepreneurs who are interested in diversifying their revenue streams, or income streams, you know, a lot of times they will acquire businesses that way. But you also need to have a lot of capital or be prepared to invest a lot of capital, because any good business that you'd want to buy, that you're going to be paying a premium for and depends on the business and the size of it all. But how you capitalize that ends up being a big equation, and then how you capitalize a two could also potentially eat into the cash flow that you're actually paying a premium for, because you might have to take a loan out for it. So there's a lot of factors in all this stuff. So that's why for a first time business owner, I like franchising and obviously totally jaded in my opinion. It's just my opinion, right?

Scott Anthony Barlow 27:04
Absolutely.

Dru Carpenito 27:04
But so franchising is not a fit for everybody. For that first category of people that want to start a business that have that true blooded, kind of trailblazing attitude mindset, franchising is not going to be a fit for them because there are guidelines, right? There is structure in place that people follow because there's a common brand. So that's why I'm going to kind of say this and it's going to sound bad. I don't mean it to be derogatory.

Scott Anthony Barlow 27:28
Let it out heard.

Dru Carpenito 27:29
Franchising tends a good fit for corporate refugees. You know, folks been in the corporate world and just become disenchanted with it, whether there's been an unexpected layoff or they're in a role and they're just not fulfilled, but they've accumulated these skill sets, right, and they have strong business acumen. And they have the want and the ambition to apply their energy to their own business. That's where franchising can come into play for folks because the value in franchising, okay, so I'm going to say this, I use the word franchising. Let me qualify that by saying high quality franchises. Not all franchises are high quality,

Scott Anthony Barlow 28:06
Just like any other industry of any kind whatsoever.

Dru Carpenito 28:10
You got it. So I work with those high quality franchises that have the characteristics of everything that I describe in terms of developing a business model that and monetizing a business model that has been proven to be successful, good franchises layer in a tremendous amount of training and support to help their franchisees implement their business model locally. And the nice thing about franchising is everybody's aligned in that chain from franchisors they make their money off of royalties which are generated by the franchisees revenue. So as the franchisees are more successful, the franchisor was more successful. So there's an alignment there that's created that where the franchisors, and the good ones take the perspective of, "Hey, we want to help these franchisees be as successful as they can. So we're going to put a tremendous amount of resources in place, we're gonna develop cool technology that they can leverage to run their businesses more efficiently." And so for folks who don't want to have to figure all that stuff out and figure out a business model to monetize, that can help them achieve what they want to achieve, that's where franchising can come into play and be a good fit. And most of the franchises, 99% of the franchises that I work with are not fast food businesses. They are businesses that are specifically looking for a franchise owner that most of the time does not have any industry experience, but they have certain skill sets and they have certain personalities. And they have a desire for certain characteristics and a business which I helped them flesh out. So as you look into franchising, there's different ownership models for different people depending on what they want a business. So that's where I franchising can be a good fit for those folks that just, they want to own their own business, but they don't want to have to figure everything out because the good franchisors have already figured everything out.

Scott Anthony Barlow 29:54
I would have even one step further on that too. Just thinking about having gone through that experience as well, I found franchising to be a really, really incredibly useful way to learn business as well, I don't think most people are thinking about it that way, honestly. But here's what I mean by that. I went to it, I guess a little sooner than what maybe many people might since I was doing this at the same time as I was finishing up my college degree. And prior to that, I really didn't know a lot about franchising and how it worked and everything like that, until I started checking into it and realizing, wow, I knew that I was interested in learning, and getting a lot of business experience, I knew that it was valuable to me to have somebody else train me on that piece of it. And I knew that I wanted to do something that actually mattered to me, rather than going and getting coffee and donuts or something like that, for some lame internship, and I recognize that although most people are going into looking at a business or looking at franchise a little bit later in life than college, I still think some of those same things can apply. Because if you haven't run a business before, like that stuff is invaluable. And I would much much rather go through and have people that are actually running businesses teach me how to do that versus go in and try and acquire some of those skill sets through, I don't know, a college degree or something else, or by doing a lot of trial and error. And oh, my goodness, it later on, when I wanted to run this type of start from scratch type business, it saved me all of that trial and error. And honestly, if I really think about it, I didn't actually start from scratch because I knew a lot of this stuff, because I had worked with other franchises and seen it. I still have actually as now that I think of it, I still have some of the checklists and stuff I gained from that.

Dru Carpenito 31:45
Yeah, well, I mean, right. I mean, you learn and they had figured out how to scale the painting business. Right? And yeah, the elements that they had you were able to learn from and incorporate because fundamentally, they're similar just in a different business. Right. So, I totally agree with what you said, the business acumen is not that important. What is the most important approaching franchising successfully is that motivation. That's what you can't teach.

Dru Carpenito 32:05
That's why businesses franchise because their business model lends itself to be more successful by somebody owning it locally that has that motivation, who's going to run it more aggressively than a corporate employee would. And the franchisors are willing to give up the bottom line profits in exchange for some top line sharing. And those bottom line profits are what the franchisees can benefit from. So yeah, the motivation is the key factor that good franchise companies look for and what the most successful franchisees bring to the table. Everything else can be taught no doubt about it. I remember there was this one individual who I worked with at advantaclean. And I mean, he was one of the most charismatic and talented people that I ever met my life. But for whatever reason, he just had not caught the breaks in his corporate world, in his corporate career. I don't know if it just he wasn't playing the politics game the way that he should have or whatever, but he never really rose above kind of like an entry level manager. I'm like, how is this guy, not the CEO of this company, because he had so many ideas that you could just tell he just had this ooze with talent. And so he quit his job and said, "You know what, I'm gonna fire you guys. And I'm gonna go my own business." And he got connected with us. And I mean, this individual has gone on to build a business much larger than he ever thought was possible. And he also was able to become an ambassador for us corporately, to help us train new franchise owners. And he found this opportunity and made the change in his career and made the commitment to open up his own business. And it was the best thing that's happened to him in his career. And also, it's helped has provided a lot for his family as well. And that's an example, I tell you that story just because for the life of me, I felt like we were so lucky to have him in the organization as a franchise owner. And I couldn't figure out why any other Corporation have wanted to just put this guy on a path to the top as fast as they could, because in my book, had everything, but I was looking at from the entrepreneurial mindset, right, not necessarily the corporate mindset, but he came with the talent, he came with that motivation, he came with that drive, and he put it to use and we just basically gave him the roadmap, and he said, boom, get out of my way. And he built this fantastic business, and then was able to help other franchise owners, which in a franchise system, that is one of those soft benefits that not a lot of people think about is that peer to peer aspect of learning from other franchise owners and getting in mastermind groups with your peers, because everybody's going through or has gone through the same thing that each franchise owner is going through, right? There's more experienced franchisees that have gone on to build successful businesses that can help mentor the younger franchise owners to help them get to where they might want to get to faster than if just working with the corporate team and whatnot. So there's so many soft benefits that can come into play from being a part of a good quality franchise system that can really just people can take advantage of that isn't one of those things that I always really think about when you think of franchising.

Scott Anthony Barlow 32:05
Agreed.

Scott Anthony Barlow 35:00
No. And I think that, as we're having this conversation, I'm realizing and recognizing that there are a ton of those sort of hidden benefits. Because for summary, I think because McDonald's has, for all intents and purposes kicked ass as a company that now everybody knows about them. That's what people think of when they think of franchising. But that's not really franchising so much, that's just like one company that's done very, very well. And now, in some ways, represents what people have a tendency to think about in the stereotype. And that's not accurate in that way. But behind the scenes to your point, the things that I didn't realize that we've just covered really quick was the training aspect, I didn't realize that that was the value exchange, when you're paying royalty to a franchise company you are paying so that they will train you, you are paying so that they provide all the systems, you're paying them so that they essentially give you everything you need, including the roadmap, to be able to move along and grow the business in the way that you want to. The other thing I didn't realize, naively, is something else that you alluded to. But I saw, you can tell me if this is your experience too, but I saw, you know, when I worked on the corporate side of a franchise company, for a short period of time, I saw the people that kind of really would take off would be those people that maybe hadn't had those opportunities, kind of like your story a little bit where they've got all the go, they've got all the motivation, they've got all of those other pieces, but they hadn't really had an opportunity to call the shots in that particular way. And then once they get into a position where they're able to call the shots and make their own decisions and do that, in the way that they see fit, when they've got all those other pieces, and they've got the roadmap too, then they just sort of take off. And that was something I naively didn't realize the opportunity for either plus this last piece that you just mentioned, of, when you're in a company like that, and you've got those peers, that becomes a huge resource. Because when you're starting from scratch, like I have to go create that. If I want that, I literally have to go find that and I have, but it is hard to go. It's really difficult versus it's built in, in a lot of ways, whether you want it to be or not in a franchise type system. So I really appreciate you pointing that out. But here's another question with that. So for people that are much more that right fit, who would benefit from a franchise helped me understand some of the things that they should be thinking about? What are some of the things that they should have in mind? Or, maybe even some of the things that they wouldn't think about that they need to know if they're considering that as a route for business?

Dru Carpenito 37:34
Well, that's a great question. So the first thing that came to my mind is to have an open mind. And I say that because a lot of times the businesses that can put people in a role that gives them the highest probability of success, that taps into their skills, puts them in a role in terms of what they want to be doing, and they don't have to be doing the stuff they don't want to be doing. A lot of times those are businesses that if you look at it from the consumer perspective, you would dismiss pretty quickly. So coincidentally, we did water damage cleanup, mold remediation, and air duct cleaning. If you look at that business, from the mainstream consumer perspective, I mean, nobody's gonna want to start that business, right?

Scott Anthony Barlow 38:14
It doesn't sound like a sexy business.

Dru Carpenito 38:16
Right, exactly. But what's sexy about it is, it's the margins are phenomenal. The backend systems that we built were very strong. The opportunity is one that's insulated from Amazon, it's insulated from recession, because as long as there's houses and buildings, there's always going to be a demand for those services. And guess what, it's expensive to purchase those services and people need professional help. So the things that I just described are the characteristics of the business from the ownership or from that entrepreneurial perspective, not the consumer perspective. So a lot of times when people are thinking about franchising, they naturally are drawn to businesses that they might be passionate about from a consumer perspective. And that is a trap, or a potential trap. Just because you're passionate about a business, or somebody says, "Hey, you know what, we need a business like that around this neighborhood. Because there isn't one" does not mean it's a good business, does not mean that people will actually pay you, or there's enough opportunity for you to build a business that can help you get to where you want to get to in life and achieve those goals. So the thing that is important is to kind of get in that entrepreneurial mindset to look at the business from the back end of it from the owners perspective and from the characteristics versus the front end. Now, the front end is important, right? Like I'm not dismissing the front end of the widget that the business produces, but I am minimizing it in terms of on the priority list of characteristics that are important to people to put them in that highest probability of success position. In franchising, there's no guarantee right, it's not a magic bullet. But do it the right way is to find a business that you're excited about and has an ownership role that's going to help you tap into the potential and also fit your budget too so that you are properly capitalized coming into it, because that's 50% of the battle as well as being properly capitalized. So coming in with the entrepreneurial mindset, and not the consumer mindset can transcend a lot of how you approach it to figure out if there is a franchise out there that might be a fit for what you're looking for.

Scott Anthony Barlow 40:19
Well, I think that to further illustrate that, too, I think that's true, not just for businesses, but it's true for any kind of opportunity that you're pursuing for any type of piece of your career. We see people every single week that went to work at Google, because they had seen you know, Google's a great company, and all these sorts of things. And then we get emails from them, just year into their new role at Google, where they're like, man, I did not realize this is what it looked like on the back end. And I do not want to be selling clicks anymore, necessarily. This is not what I thought it was necessarily. And I think the same thing is very true of when you're looking at owning a business, you have to understand what it actually looks like on that back end. Okay, so what else?

Dru Carpenito 41:03
Second most important thing is your "why". Why is it that you want to open up your own business? And when I say why, I mean, long term, right down the road, the beautiful thing about opening your own businesses, it's a blank canvas, you have the opportunity to create a business that enables you to have a life that you might have always dreamed of. And there's no limits to what that can be, or at least like, that's the mindset that I'd like people to have. Because I think we're kind of groomed to kind of put up barriers around what could be potential, the potential could be for people's careers. But in business, kind of having that 'why' and thinking about what do you want your lifestyle to look like five years down the road, once you've built the business and it's mature, and it's cash flowing in, you know, if you build it the right way, it's not going to be as dependent on you as it was when you started it. So from a lifestyle perspective, you know, what do you want to be doing? Traveling or living from the beach for six months, a year, whatever it might be, right, kind of having that lifestyle piece figured out. And then also from an income perspective, what how much money do you want to make, and then backing into what the business needs look like to be able to produce that income for yourself. And then also, I think there's a wealth piece of this, too, that not a lot of people think about their exit strategy at the beginning. And it's a hard thing to kind of think about or figure out, I'm not saying that you should have it all figured out. But one thing that people, I think it's kind of, you know, an aha for people, when they start looking at franchises and even businesses is, when you build a successful business, you build a cash flowing asset, that somebody will pay you a premium for, kind of like when we talked about that second option of buying an existing business. Well, if you're on the ownership side of being the person who built this business, that's cash flowing, and it's not dependent on you, which means it's very transferable, which means it's going to be very attractive to a buyer, because the business doesn't revolve around you, which means they can kind of slide in and, and take over the management, whatnot without missing a beat. That is a significant wealth creation opportunity for people. So not only do you have the opportunity to build a business that provides an income stream for you, and also can enable the lifestyle that you want. But there's an event opportunity, if you want to sell it down the road where you could potentially earn a significant amount of money by selling it to somebody and franchising. One of the coolest things I've ever done in my career is to help somebody sell their business.

Scott Anthony Barlow 43:26
Really, I'm curious why you say that.

Dru Carpenito 43:28
I mean, it's like the full circle for me, I helped them start it, I got to watch them and help them build it. And they went on and built it on their own. And then guess what? They get to sell it. And if they did it the right way, they get to sell it for a heck of a lot more money than they probably thought it was worth initially. Because there is a market for people that want to buy existing franchises, and franchises to buyers, existing franchises to buyers can be very attractive because of the exact same reasons that people decide to invest in them in the beginning because of the resources, the support, the culture, the opportunity, whatever it might be. And that is when I'm able to see and help somebody and play a role, big or small role in them selling the business that they have invested their money and their sweat and their blood and their emotions into and built it beyond what they thought they could build it to and then get paid by a buyer more than they thought it was worth I think, I don't know if that's like the full circle for me. And then it's a cool thing to be a part of.

Scott Anthony Barlow 44:25
It sounds like the business equivalent to becoming a grandparent. Like, you had this kid and you know, pours blood sweat tears and all the things and then and now they're having a baby. This magical. It really does so like the business equivalent to becoming a grandpa.

Dru Carpenito 44:48
Yeah, you know, I was getting a little emotional talking about it. I truly sincerely. I just love it. I love every bit of it. It's for them. Like I love watching them to achieve what they wanted to achieve, you know 5, 6, 7 years ago, what they set out to achieve, they get there. And here's the thing, during the beginning, right, when it's time to make that decision of, am I going to do this? Like, am I going to move forward with this franchise? That decision in and of itself is scary. I mean, that's where most people, they don't get over that hump. They don't... not most people, but that's where a lot of people can back away. So help somebody over that initial, I mean, it's probably up there in the top three life changing decisions people are going to make, right, to help them overcome the fear, and help them make that leap of faith because there's a leap of faith that they're making when they decide to make the initial investment and move forward. Eight years later, 10 years later, whatever it is to watch it come full circle and just kind of say, "Hey, I told you. I told you is gonna be okay." And then we'll see unbelieve it and earn with it, what was deserved physical thing.

Scott Anthony Barlow 45:43
That is really interesting. And I hadn't thought about it that way, in particular, but it does raise a couple other questions for me, thinking about what we've talked about so far. I think there's a lot to it, I guess, first of all, but here's what I'm curious, because one of the reasons that we haven't talked about extensively, but one of the reasons why I was interested in having this conversation with you, was because of what you do in the way that you do it. And what I mean by that is, as I learned a little bit about your process, and as I learned a little bit about, like, what you do, like you are almost in some ways, like a little bit of business and franchise, matchmaker, and being able to take all those inputs of, "Hey, why are you wanting to do this? What is the result that you want in five years from now? What are the most important pieces to you about this? What are some of your goals that are along the way?" And the mean level to take that and move it into something that is actually real and tangible, and business that actually aligns with what people want? I think that is, I can't think of any other word than magical, but I was trying to avoid something that sounds like unicorns and butterflies and everything else along those lines. But that's great. It's amazing. That is the reason why I was interested in having this conversation. So tell me a little bit about that. And what do you consider? What do you do? How do you do that? Help me understand a bit of that.

Dru Carpenito 47:12
I view myself, so I have the title franchise consultant, I don't know what that means, to be honest with you. I don't charge people for my services. So it does not cost anything to work with me. And I tell you that because I view my role as a guide, as a coach, in that, what I do with folks is I really spend a lot of time getting to know them and developing a relationship with them. And them developing a relationship with me, I think anybody you work with, and under a situation like this, where you're looking at a potential life changing situation, you should be getting a tremendous amount of value from that person. And I try to take all my experiences and use them to help the people that I work with, guide them down a path that is going to help them get to where they want to get to. Not that I know exactly which turn to make all the time. But I've been down the path a couple of times before. And a lot of times the folks who I work with they they have never been down that path. And there are wrong turns you can make going down that path. So I kind of consider myself a guide in terms of we start backwards, where do you want to be in 5 or 10 years? That's kind of where we start. And then from there, we drill into so many different topics of conversation from franchising, to me asking questions to help flesh out exactly what are those important characteristics to the folks who I work with? Because people don't know what they don't know, right. And for the folks that come to me with an open mind and want that guidance, and help 9 times out of 10, the result is a business that they've never thought of before or even considered before. So I really view my role as a guide that, you know, has an idea of how to help somebody get to where they want to get to, because I've been on the path with so many other people before.

Scott Anthony Barlow 48:54
I'm super curious Dru, what are some of the types of questions that you ask during that process?

Dru Carpenito 48:59
So one of the big things that I focus on with people, because I've seen this as a key area to get right is, what do they want their role to be in customer acquisition? Because any small business and any business right, it starts with acquiring a customer. Well, there are different customer acquisition models that businesses have, like advantaclean. It was a very B2B. So we would generate businesses from developing relationships with real estate agents, insurance agents, plumbers, HVAC companies, anybody who is in and around a building, right or a home. Well, that's a very relationship driven business. That means that the owner has to be out there developing relationships in order to drive business. Well, if that business is not a fit for somebody who's more introverted, and does not want to be the face of the business out in the community, right? Well, there are other businesses that are much more driven by inbound lead generation where the franchise company has developed tremendous marketing and lead generation systems that make the phone rang, or drive leads to a customer service rep who and then booked an appointment that somebody else goes out and does, right? So just because you don't consider yourself a salesperson does not mean that there's a business out there for you. But it does mean that you should focus on the businesses that have those inbound customer acquisition models. And that inbound customer acquisition is not something that you see advertised on franchise internet directories, right?

Scott Anthony Barlow 50:22
No.

Dru Carpenito 50:22
The stuff you see, hey, we're the best business because of this feature and this benefit, and blah, blah, blah, blah, blah. They don't say, "Hey, if you're an introvert, and you like inbound lead generation, this business is a great fit for you." You know what I mean? So I believe that customer acquisition is one of the most important things for people to get right, in terms of what their role is going to play in that.

Scott Anthony Barlow 50:41
That's interesting. What else?

Dru Carpenito 50:43
Funding. Like what somebody can realistically afford or with are comfortable investing in is a big piece of it. I think being properly capitalized is 50% of the battle, right? How do you plan to fund a business? And I connect them with funding companies that are experts in this stuff to help them figure it out, but how much personal savings or cash are you comfortable injecting into the business? How much do you have in reserve for your personal working capital, right, to cover your lifestyle expenses until the business because it's gonna take some time for any kind of business to grow and mature to where it's producing enough cash flow to not only cover itself, but also for the owner to take out of the business. So funding is a big piece of it. And then we kind of get down to number of employees, some people just they don't want a lot of employees, some people say, "Hey, I don't care how many employees, I want to scale a big business." But that's a big piece of it as well. Some people also are interested in opportunities that are more manager run businesses that have an opportunity for them to keep their job and start a franchise. And then ultimately, four or five years later transitioned into the business, or if they've opened up multiple locations, whatever, there are business models out there that are specifically designed for people that have an extra 15 to 20 hours a week that they want to invest in their own business, there are franchise models that follow a very strong manager run business model that they can achieve that they can diversify their income, they can start a business with the extra time that they have in their week and build out multiple locations if they want to, is that they have an existing amount of cash flow to transition into you know, once they decide to leave their w two income.

Scott Anthony Barlow 52:16
So couple that lives just down the street from where we live. And now the exact route that they did, they initially were both working and then ended up acquiring their first franchise. And then they were working at that both of them actually, the couple together, were each spending about 15, 20 hours a week, and working within the franchise, and then they made it their full time thing. And then they did that same thing with another franchise like they were working as they built it up, they ended up buying a totally different franchise, in fact, and now they have three different types of franchises. And , geez, has been about four years or so, three different types of franchises and I think six different locations at this point.

Dru Carpenito 52:58
Yep. And they're probably not in the stores, you know, interacting with customers too much, right? They're probably much more behind the scenes, working on the culture, managing the managers, empowering their managers, leading their teams, maybe making key staffing decisions. But you know, you're not going to see those people in the store at the cash register checking you out when you go in that right, they are behind the scenes. And so I think that kind of goes back to a little bit of the mindset too, right? Like people think of businesses and they think, hey, as the owner, I have to be the chief cook and bottle washer, I have to be the person behind the counter checking customers out. And I don't want to be doing that, well, you don't have to be doing that. In fact, a lot of times, like the couple you just described, to me, it sounds like they have a very impressive business. And that's where scalability can come into play with different franchises. So this is just a sampling of, I spend 60 to 90 minutes, taking everybody to work with through a detailed consultation where we flesh all this out. And then I summarize it for them in a document that I spent a lot of time writing up so that we can establish what the key framework and criteria is for them around their ideal business model. And then that's what gives me the guidance to go out and do a search for franchises to come back at to recommend that they research. And then I have a whole system that we that I teach people about how to systematically do due diligence on a franchise because one of the biggest benefits of doing due diligence and researching franchises is there is so much information that you can research and there is a system to use to kind of go through it all but franchising is regulated by the Federal Trade Commission. So the franchise companies have to provide a significant amount of information to prospective franchisees. And that's great, but the most valuable thing that people can do in their due diligence and this is the coolest thing I think out there that's pretty unique to franchising is it's very simple. It's call existing franchise owners. The good quality franchise concepts are going to say here's our list of franchise owners, here's their numbers, you call away. We're so proud of our franchise owners and the businesses that they built that we want you to call everybody, but that's what we call validation. That's where you can validate a lot of what you've learned about the business directly from the franchise company to figure out, hey, these people really have built businesses that are aligned with what I want to build, or maybe you have a couple conversation and you figure out, hey, maybe I don't somewhat identify with these folks. And maybe it's not exactly what I thought or whatever. So, to me, you know, having that opportunity to validate a lot of the conceptual information that you learn is really where the rubber hits the road and the due diligence and gives people just a tremendous resource of information to help them figure out if a franchise or if that particular franchise might be the fit for them.

Scott Anthony Barlow 55:38
I love that advice. And I think that, first of all, that is empowering, when you think about it that way, because then it really is you finding the actual fit for you versus just accepting, you know, what's out there. And plus, you know, most franchise companies are pretty proud of what they do, and, like they are biased too, in terms of they believe it's a great franchise, but that doesn't necessarily mean it's a great franchise for you. And being able to bring in a lot of those data points can help sift through. So I love that you do that as a part of the process, if you will, by the way, one of the things that we are doing, we are taking all of this information from this episode in distilling it into a mini guide, and you can go over to happentoyourcareer.com/248, or search Happen To Your Career and franchise. And it'll pop right up as well. And find everything that we've talked about in format that you can even download. And Dru, I really appreciate you taking the time and going through all of this. So I just have two other big questions for you. One is for people that it's piqued their interest, and they're like, wow, maybe this could be a good route for me. What would you advise them to do to find out if it actually is?

Dru Carpenito 56:57
Well, I think it all starts with a conversation with me, because I need to learn more about anybody's individual situation. So the first step would be if you wanted to have a conversation with me, I'm very accessible, you can go to my website, which is freefranchiseadvice.com. And just fill in the form. And I will get that and be in touch. Or you can find me on LinkedIn, I do think I am the only Dru Carpenito in the US. So you can google me, you can check me out very accessible, but reach out and have a conversation. And we can go from there and maybe have the conversation and you want to do a little bit more research, I would recommend two things, you can follow me on Facebook, or on LinkedIn. And I will put out content. And it's not the most professional content, I literally will be driving in my car and a topical hit my head and I will just start making a video. And I will publish that video about business ownership or franchising or an interesting conversation I had that day. So I'm putting out some content that I think people could find useful. I've written a franchise investment guide as well. So if you are interested in that, just send me a message. And I'd be happy to send you a franchise investment guide that kind of distills a lot of what I talked about today and a 20 page ebook that you can check out, but there's no charge to work with me. There's no contracts either. So I'm not gonna try to sell you anything. If you jump on a phone me, I promise. But that would be the best way to get in touch with me or check out some more information about franchising.

Scott Anthony Barlow 58:25
Well, and I really appreciate that. And again, that's one of the reasons why I was interested in having this conversation with you, particularly because you're in that very unique situation. And honestly, we considered bringing on some people in the past that are in franchises, or even members of a particular franchise company to help people understand and learn about this as a potential career option. However, the main reasons why we didn't is some of the biases that go into it. And we wanted to be able to have kind of a more holistic way to learn about this. So I really appreciate you and what you do, and also taking the time to come on and provide that holistic learning option like the way that we've just talked about it, essentially, who is this good for? Who is it not good for? And, who would be better off in a different situation? So that means a lot to me. And I know that that'll be very helpful to everyone listening to. So thank you.

Dru Carpenito 59:17
Great. Well, hey, Scott, I thank you. This has been fun. I've really enjoyed speaking with you and talking about the topics. And I think you do a great thing with putting out information and content for folks to tap into, as they are thinking about potentially making a career change.

Scott Anthony Barlow 59:30
So if this sounds like something that's interesting to you, I would highly recommend contact Dru, follow him on LinkedIn, look him up, follow him on Facebook, go over to, can you tell me the address again so that we can get it right?

Dru Carpenito 59:41
Sure, it's freefranchiseadvice.com

Scott Anthony Barlow 59:46
Go over to freefranchiseadvice.com and find out and learn if this is a great opportunity for you. Thanks again, Dru. Really appreciate having you here.

Dru Carpenito 59:57
Scott, well, thank you for having me, my friend. It's been fun.

Scott Anthony Barlow 59:59
Hey, we've put eerything from this episode into a guide about both different types of businesses and franchises, and we wanted to be able to put everything into one place. So if you're interested in getting that just go ahead and go over to happentoyourcareer.com/franchise, or you can just search Happen To Your Career franchise in Google and it'll pop right up. But if you enjoyed it, head on over to the website, happentoyourcareer.com/franchise and I think that you'll love that. We have so much coming up for you next week, right here on Happen To Your Career.

Evangelia LeClaire 1:00:35
Know yourself and accept yourself, your experience all of the equity that you've built in your career, in your personal and professional life, and appreciate that for what it is and then begin to identify what you've done in your experience and even the character traits that you have that could connect the dots to this future opportunity.

Scott Anthony Barlow 1:00:59
All that and more, right here on Happen To Your Career. Until then, I am out. Adios.