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April 18, 2022

Ted Lindsley On In The Trenches Strategies To Optimize A Liquidity Event (#117)

Ted Lindsley On In The Trenches Strategies To Optimize A Liquidity Event (#117)

"The wisdom that I have today as a result of the path that I've chosen." - Ted Lindsley

Ted Lindsley is a serial startup, CEO, and technopreneur with three successful ventures under his belt and two exits, including one to a $2.5 billion NASDAQ traded company. He has a proven track record of recruiting exceptional talent and leading those teams to achieve success.

Ted has raised millions of dollars in venture capital, secured over 20 patents, has been interviewed on every major television network and provided SME testimony to Elected State Legislative Groups. In his early career, Ted spent 13 years in headhunting building sales and engineering teams for nearly 100 technology-driven startups and Fortune 1000 spin-offs.

In 1996, Ted invented. Talent Scouting And Acquisition methodologies are commonly used today, by nearly every major technology company around the world. He has lived, worked, and traveled in over 70 countries, including a three-year around-the-world, hiatus adventure with his wife after selling his first startup.


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Your liquidity event is the most important financial transaction of your life. You have one chance to get it right, and you better make it count. 

But unfortunately, up to 90% of liquidity events fail. Think about all that time, money and effort wasted. Of the "successful" liquidity events, most business owners leave 50% to over 100% of their deal value in the buyer's pocket and don't even know it.

Our founders said "no" to a 7-figure offer and "yes" to a 9-figure offer less than two years later. 

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Transcript

[00:00:00] Jeffrey Feldberg: Welcome to the Sell My Business Podcast. I'm your host Jeffrey Feldberg.

This podcast is brought to you by Deep Wealth and the 90-day Deep Wealth Experience.

Your liquidity event is the largest and most important financial transaction of your life.

But unfortunately, up to 90% of liquidity events fail. Think about all that time, money and effort wasted. Of the "successful" liquidity events, most business owners leave anywhere from 50% to over 100% of their deal value in the buyer's pocket and don't even know it.

I should know. I said no to a seven-figure offer and yes, to mastering the art and science of a liquidity event. Two years later, I said yes to a different buyer with a nine-figure offer.

Are you thinking about an exit or liquidity event?

If you believe that you either don't have the time or you'll prepare closer to your liquidity event, think again.

Don't become a statistic and make the fatal mistake of believing that the skills that built your business are the same ones for your liquidity event.

After all, how can you master something you've never done before?

Let the 90-day Deep Wealth Experience and our nine-step roadmap of preparation help you capture the maximum value for your liquidity event.

At the end of this episode, take a moment to hear from business owners, just like you, who went through the Deep Wealth Experience.

Ted Lindsley is a serial

[00:01:45] Jeffrey Feldberg: startup, CEO, and technopreneur with three successful ventures under his belt and two exits, including one to a $2.5 billion NASDAQ traded company. He has a proven track record of recruiting exceptional talent and leading those teams to achieve success.

Ted has raised millions of dollars in venture capital, secured over 20 patents, has been interviewed on every major television network and provided SME testimony to Elected State Legislative Groups. In his early career, Ted spent 13 years in headhunting building sales and engineering teams for nearly 100 technology-driven startups and Fortune 1000 spin-offs.

In 1996, Ted invented. Talent Scouting And Acquisition and as methodologies are commonly used today, by nearly every major technology company around the world. He has lived, worked, and traveled in over 70 countries, including a three-year around the world, hiatus adventure with his wife after selling his first startup.

Welcome to the, Sell My Business Podcast.

And as always, I have a dynamic and terrific guest for you. Here's what I got to say when it comes to our guests. Success is not an accident and repeatable success there's definitely something behind the whole success and the secret sauce of what's going on there. Our guests today, Ted has not just one success, but multiple successes so all that said, Ted, welcome to the, Sell My Business Podcast.

So delighted to have you with us, Ted, why don't we start with this? There's always a story behind the story. What's your story? What got you to where you are today?

[00:03:27] Ted Lindsley: Yeah. That's a loaded question. The short version is that I spent 13 years in headhunting, building companies for others out in Silicon Valley, they would get a big check of venture capital and they'd call my team and say, ah, I gotta hire 500 people right now. And we would spend six months to a year building out this team and helping them to reach their goals.

And 50% of the time I noticed that these entrepreneurs after they got their check, would slack off. They would start buying boats and Hummers and taking long weekends and acting like, you know, gods of the world. And they lost focus on their direction. And I would just scratch my head and say I don't get it.

You got your check, you got $10 million, whatever, here's your shot and you're blowing it. And I would watch about half of them fail. And I swore that man if I ever got so lucky that I could convince people to put money in me and do that I wouldn't act like that I would be frugal and careful, and I wouldn't lose track of what I'm aiming to do. And so that's been the driving force of my career since I jumped in on my own.

[00:04:28] Jeffrey Feldberg: Wow. And so here you were, you saw some big transactions taking place. You're helping to find the talents, and put them into place. So what happened after that? So that sounds like it lasted for a while. What n

[00:04:40] Ted Lindsley: Yeah, that did that for a long time. When I finally started my first company just getting funding was virtually impossible because nobody would believe as someone who comes from recruiting could possibly be a CEO. They would laugh. They would actually laugh at me. And so I funded my first venture and just bootstrapped it and built it up from scratch until we were able to start raising some seed capital and some expansion capital.

But even then I ended up giving away most of the company as a first-time CEO. I didn't care. The goal was, I'm going to build this company. I'm going to get to here. It wasn't, Hey, I'm going to go raise a bunch of money and I'm going to build this cool thing. And then two years later, I'm going to sell it.

I'll be a multi-billionaire with a yacht next to Larry Ellison. And that's, you know what everybody thinks it doesn't work that way. Money is part of this equation. But if you're doing this only for money, when you're already off track. And like I said, you have to stay focused. Okay.

[00:05:31] Jeffrey Feldberg: And so title, let me circle back to one thing that you said, you mentioned the B-word, bootstrapping, and that's a personal interest of mine. I mean, my e-learning startup at the time Embanet was bootstrapped and not all the time. A good portion of the time when a company bootstraps, they're also operating like a cockroach startup, which is one of my favorite topics, written a number of articles on that, and Embanet lived and breathed that.

So I would love for our audience to get the benefit. Let's go back to your first company. You left the recruiting role. You're bootstrapping it in your company. So for the benefit of our listeners, because if we're honest today, many entrepreneurs have grown up and they've had venture capital at one point.

Now people call it private equity. And to your point, millions and millions of dollars are being poured into these companies. They have really no paying customers. Profits are nowhere to be seen. What were some lessons learned on the bootstrapping side?

[00:06:27] Ted Lindsley: So it forces you to do on a certain path, right? If you're bootstrapping it's your own money or it's, whatever you can scratch together and you have to find a way to make things work and get there cheaply and efficiently. So out of necessity, you're forced to do things a certain way. And if you're lucky and you have a good business model and there's obviously luck involved, but it definitely teaches you how to get there on a shoestring. And then from there, then you can just expand and move forward. If you retain that as you're raising capital and expanding the company, I think you're going to do better. You don't lose sight of that. Back in the old days, venture capital came from people who actually were entrepreneurs, right?

Silicon Valley was built for people who built companies, hardware, and software ventures made lots of money, and then decided to spin things off. And so they've been there in the trenches. They've done it. They provided leadership and guidance because it was their money. Silicon Valley today or just the VC community in general, isn't made up of that.

I find myself, even now you want to go get money? You're pitching a millennial, someone who's 24, or 25 years old and got a finance degree from Wharton or Kellogg or some fancy school. He knows nothing about being a venture capital about building a business, knows nothing about being an entrepreneur or living in the trenches and making it happen.

Everything is on a spreadsheet. And so if they're making decisions based on that, they're already pointed in the wrong direction. And I'll go off on a tangent talk for 20 minutes about that, but it'll bore people.

[00:07:55] Jeffrey Feldberg: At least two people, you and I would be interested in that, but I hear you. And for the benefit of our listeners, Ted, the first company, what were you doing?

[00:08:03] Ted Lindsley: We invented a robotic satellite dish that would provide a T1 connection. So this is before 3G. This is 3G was just beginning to be built and coming online. And then. A couple of urban areas, but people wanted a remote connection for oil and gas, and construction broadcasting.

And this was a little satellite dish. That's robotic about three feet in size that you could put on a vehicle, push a button. It would pop up block onto the satellite in about 90 seconds. And it would give you a T1 data connection that supports voice and data and whatever you want to accomplish. And this was huge at the time.

And so we built it up. Posts multiple rounds of funding and growing the business, Katrina hit. We were a splash with Katrina and in the wake of that in the years that followed Katrina, doing better preparations that we really ramped up. And that was led to what led to the selling the company at the end of 06.

[00:08:54] Jeffrey Feldberg: I hear the word T1. Ted, you're taking me back down memory lane, because a wine, at least back in the day you had dial-up modems and a T1 today would be like, take your fastest fiber and even go beyond that. It was very expensive. Not a lot of companies had it at the time.

[00:09:10] Ted Lindsley: No everybody had a dial-up connection. And that's a wired connection to have a T1, which is 1.5 megabyte up and downlink both ways, but that's remote was a major deal and broadcasters jumped on it. And we started signing them up and construction companies needed to have SCADA data and drilling data remotely sent from the field.

And we were able to do it with a small form factor. And so that was the claim to fame. The product is still sold today from a company called Viasat I had just bumped into it at a trade show last year. And I was surprised to see they're still selling the same.

[00:09:40] Jeffrey Feldberg: Wow. So it's a gift that keeps on giving it in terms of what you had done and what you had created. And so let's set this up now. First time as a business owner, you'd come out of the recruiting industry. You were bootstrapping the company. You had your liquidity event in 06. So you had some success leading up to that. At the start of the conversation though, you said, Hey, this was my first company.

I didn't know what I didn't know. And ultimately you ended up giving up most of the ownership in the company. So what was that like as you look back for the business owners who are going down this path, but they haven't gotten the what would be some lessons learned that they can, from your heavy lifting in the trenches that they can benefit from?

[00:10:18] Ted Lindsley: Yeah. That's a good question. A lot of people don't realize that if you're going to be successful, you're not going to end up owning most of the company. It's just the opposite. Few people realize that Zuckerberg owns 10% of Facebook altogether. And these collective investors, VC firms own the vast majority of it.

So that muscle was what got him to where he needed to be. And so I accepted it. I didn't like the fact that I had to give away most of the company, but in the end, I think if it had 11% of it when we were done, but I'll take 10% of a home run any day, over a hundred percent of a failure.

The toughest part was though just the machine that you have to go through to raise capital. It is a grind if you're the first time or you're lost in the woods and you have no clue what's going on. Even the second, third, and fourth time around you learn.

It's just, it's tricky. It's a treacherous path that you're going to go through. There are lots of obstacles. You can have the best lawyers and accountants on your side and there are still tricks to be had. And so things are going to pop out of the woodwork. The question is what are you working towards at the end?

For me personally. I'm excited about the technology. And if I focus on that and I know there's a need for it, and I'm solving a problem and the customers love it, the money's going to come anyway. It might not be hundreds of billions of dollars. It might not be a million dollars. It could fail.

You could be wildly successful. There's a lot of luck that falls into that. But if you can focus less on that and more about building the business, if That's what you're passionate about already, you're off to a better start.

[00:11:43] Jeffrey Feldberg: That's terrific. So can you talk to us about the liquidity event? What did that look like for you, Ted? How did it end up panning out?

[00:11:49] Ted Lindsley: Yeah, that was a bizarre one because this was hardware combined with services. It would be like a, I equated to Verizon selling a phone and also providing the data services, so in that era, you were either hardware or services, but not both. And we were the first company that did both. We sold the hardware and we bought. Satellite services, all the transplanters that sold them. Nobody wanted to buy that model. It was crazy. In the end, the companies were literally split in half and we sold it in two pieces. Andrew Corporation which is still in business today bought the hardware side of things and all the technology and then SES Americom which was one of the wholesalers providing the data services, bought the subscriber base.

I still couldn't figure it out. You thought that they'd see a successful model here and they'd want to buy it, but it was just out of their wheelhouse. They couldn't understand. And so they each said I'll take this, I'll take this and that. So that's how the liquidity of that occurred. They split it up,

[00:12:44] Jeffrey Feldberg: Wow. So really you're ahead of your time. You're way ahead of your time. And just people couldn't, they didn't get it. They couldn't visualize.

[00:12:50] Ted Lindsley: That has been a problem for me my entire career is that I'm always five to eight years ahead. And I'm only now learning that it's not always a good thing to be 10 years ahead of the competition, because nobody understands what you're trying to do. My wife used to say you're trying to sell an iPhone And they're all using those old Motorola bricks. And you're trying to say, yeah, but it's not just a phone, it's a computer and they look, no, I have a computer. No, it does that automatically. I don't need that. Yes, you do. And they just can't conceive it. So I fought, and managed progress my whole career thinking why can't we just leap forward multiple steps and get there right now.

And I'm only now realizing late life that the reason is because the general public, the business community can only go at a certain pace. And so if you're five or 10 years ahead, you're often too far ahead.

[00:13:38] Jeffrey Feldberg: And it's interesting for our listeners as they think about a product or a service that either they have, or they're developing. If you're too far behind the curve, you got a problem. But if you're too far ahead of the curve, as you saw Ted, it was an issue. And so with your liquidity event, how did that end up happening in regards to, was this something that you brought in professional investment, bankers, and advisors? Were you doing it yourself? What did that look like on your first?

[00:14:02] Ted Lindsley: Yeah, by then, I'd had enough of the professional quotes advisers and consultants. And so I knew what I wanted to do and I was ready to get it. We would go gone through a number of stages. And I had a stage where I was unhappy with some of the investors that came in. And so I was just ready to clean the house and get it done with, and so I was able to negotiate the first one myself but even going through that, it was still tricky.

They were trying to pull shenanigans in meetings and claiming things that were not true and saying you said you would do this and do that. And it got so bad that I actually had to record meetings. I'd actually go into board meetings with a little pocket recorder, just so I'd have a record of what was said and what wasn't said, what was promised.

And so that I could say, ah, let me just refresh your memory here. And once they saw that I wasn't playing games, then it started going a little bit faster, but yeah, there's it's business. It's just, it's how it is.

[00:14:56] Jeffrey Feldberg: Wow what a learning ground for you, Ted? My goodness.

[00:14:58] Ted Lindsley: It is. It is. Yeah. But these are lessons that you take with you, right? And you learn as you go.

[00:15:03] Jeffrey Feldberg: For our listeners, what advice would you give in regards to that whole experience when it comes to advisors, investors, board of directors, how should we be approaching that as we think about that?

[00:15:16] Ted Lindsley: Yeah. So the majority of this comes from with that. If you're going to be an entrepreneur lots of people are attracted to the lifestyle, but they only see the glamorous part of it, which is the exit, which is way down the road. The overnight success that took 10 years to build, what are you willing to give up?

Or are you ready to not take a vacation for the next five years and work 80 hours a week, maybe without pay no holidays working on the holidays, and sacrificing your family time? These are things you have to ask yourself. If you're willing to do all those things that. Maybe it's worth a shot. But you've got to be a lot of cases, crazy to want to undertake, starting your own venture because of what's involved in doing it.

If you're one of the people that likes that kind of stress and you thrive on it, chances are you going to be successful, but then since you have that drive internally, You're probably not going to look for a lot of people externally that are going to do more than provide some of the pieces to the puzzle.

Like you need good legal. So you want to find good lawyers, not a lawyer, the lawyer. You want good finances. You're going to interview these people and determine what makes sense. Who's going to be your best advice that?

you can trust. And it's got your back. Board advisors and stuff. Do you really need them?

I don't know. I've been there with, And without them, and sometimes it makes sense. and sometimes they don't.

[00:16:29] Jeffrey Feldberg: And as you share that with us, you're preaching to the choir here at Deep Wealth in our 90-Day Wealth Experience we have module number four, five, and six, and module number six, in particular, it's all about the advisory team. How do you find the right advisors? The investment banker, the lawyer, because of your point, you can't guess he can't.

I think I have the best investment banker. I think I have the best lawyer or accountant you have to absolutely know, and we have a whole. System and protocol and questions to ask and scorecards that you get to be able to do that. But so you hide your liquidity event. You're now heading into the post-exit life in 2006.

So what happened, did you take some time off? Did you enjoy it, what was that like for you? And then what happened after that?

[00:17:15] Ted Lindsley: Yeah, it's, we were gone for three years. My wife and I planned a trip around the world. So in 07, we took off and mapped out a three and a half year trip just to meander around the world very slowly and see it while we could. I thought while I'm young, while I can still climb that volcano and jump off that cliff and do the active things, let's do it now.

And I'm glad I did that. I see too many people who wait and wait and push it off to retirement. Only to find out that they're in poor health or they can't do the things they wish they could do. So Carpe Diem to seize the opportunity and I'm glad I did. And we ran around the world for three years and ended up settling in Bangkok for an additional six years after that. Which is where I started the trucking company.

[00:17:54] Jeffrey Feldberg: Wow. And we'll get to the drone company in just a moment here, but I'm just curious with the post-exit life because it really sounds like you embraced it and you thrived with it. And I'll speak for myself. I know myself and so many other business owners, my post really, as I look back was confusion, chaos, and not really finding my happily ever after.

It took me quite a while to really get my North Star so it sounds like for you, you just jumped two feet in and started traveling around the world and just enjoyed. How did that come to be with your mindset?

[00:18:28] Ted Lindsley: Yeah, that's not in my nature to do that. My wife can talk me into doing things that I wouldn't do myself. So we mapped it out and said if we're going to do it, let's do it right. Since we're both corporate people and we, we know how to work a budget. And we did that. So it's funny, but I actually bootstrapped the travel as well.

We could have gone extravagant and stayed in four-star hotels and live lavishly but didn't want to do that because I wanted the experience of being in these countries. So the best way to do that is to stay a little one star, two-star hotels, hostels. In some cases, if they had a private room where, you know, my, my wife and I could stay together, not in a dorm and we forced ourselves to do that.

To experience the culture and meet local people and travel very slowly. And the takeaway from that was huge. I've been to 70 countries, not visiting for three days, visiting for weeks at a time, meandering slowly and meeting the people and learning some of the language and the culture. And that's helped me moving forward in my career

[00:19:23] Jeffrey Feldberg: And for listeners, there is so much to unpack there. And for starters, Ted, what you did, I have an expression for myself, just because you can write the check doesn't mean that you should. You said, okay, we have all the zeros in the bank, but we're not going to really tap into that.

We're going to bootstrap our travels like we did the business. You had a richer experience as you stayed in these hostels and these one-star hotels and just meandering around the different towns and cities as you went through your travels. With the funds that you had from the liquidity event, did you just park it away in some boring term deposit for a few years to figure out what you're going to do when you got back? Or what did that look like?

[00:20:00] Ted Lindsley: Nah, I was trading the stock market, but I did at a point I have to park it in the funds in. And longer-term investments because the way we were traveling, you're disconnected as you can't day trade as much as you'd want to. So I had some of it in accounts where I could day trade it. But ultimately it just made more sense to park it in one place. And that way you could just check on it periodically.

[00:20:20] Jeffrey Feldberg: And probably a blessing in disguise as you weren't off

[00:20:23] Ted Lindsley: Actually not actually, I lost a lot of money going along.

[00:20:27] Jeffrey Feldberg: Oh my goodness.

[00:20:28] Ted Lindsley: Trader, so I was swing trader and day trader. I like to control my money and I've always done well that way, parking it with somebody else to manage it was a significant loss and I kicked myself for that. But what are you gonna do?

You're on a mountain for two weeks and then you come back and what happened? The markets all. 08 09, things were just crumbling. And I had no idea that was all happening.

Took a hit yeah. Part of it, ultimately the zeros, Jeff, there are zeros. So don't get too focused on the money part. If you're, if you enjoy what you're doing and you're gonna be successful anyway, the money's going to come. If you've done it once and you've been successful, then you relax because, wow, I can do that again. This is not as hard as I thought it was. The hardest part is actually doing it the first time.

[00:21:09] Jeffrey Feldberg: So three years have passed. You've traveled the world yourself and your wife. You get back to the States and you're going to go with venture number two. So talk to us about venture number two of how did that work out what was that all about for you?

[00:21:22] Ted Lindsley: Yeah. I saw the toy drones that people were playing with in the, in some of the universities, this little dinky thing, there was, this is 2009. They were just beginning to play with these multirotor drones. And I looked at it and thought, wow, that's, there's a business case for something like that, but it's going to have to be a real aircraft and a big one that can do all these things for civilian applications like a helicopter would do. Started knocking on doors. I, I'm looking for a half-million dollars in seed capital to start a drone company for civilian applications. And I probably had 150 VCs tell me that it was nuts. Remember, this is 2009, 2010, and say, what's a drone company, but it's for civilian applications that does all these things.

And they'd look at me. They say you mean drunk? The ones on TV that kill people like that? No, no, No. We're talking about that kind of technology, but applied in the civilian world to do all these things and it'll save lives and people and money and they just couldn't grasp it and thought I was, I said, that'll never happen.

You are. You're crazy. I funded it myself and I seeded the business. You fast forward. And three years, all of a sudden, in 2012, Jeff Bezos starts talking about drones and then the whole industry lit up and all started. And that's where all the VCs piled in and started funding wild-eyed ridiculous concepts.

But the industry in the complete wrong direction, and they're still recovering from it, but a billion dollars of lost funds later and they're waking up. Remember these are the VCs, the smart guys, and are deploying investor capital. And I'm just amazed at that they really don't have a grasp at a lot of this stuff. They just throw darts at the board and get lucky.

[00:22:53] Jeffrey Feldberg: Let's talk about that. This is really interesting. So at first, you were knocking on doors for other people's money. OPM is always good when perhaps that can happen but didn't work out and you said, okay, you know what, I'm going to bootstrap it again. And so you went into your own personal funding and you started the company.

[00:23:08] Ted Lindsley: Yeah except instead of bootstrapping, and you're just gonna park a half, a million dollars in there and say, here we go. If you won't fund it fine, I know what I can do. I see what this is going. And which is, which took me back to the first venture, because when I was looking for capital, there was always an excuse.

Just because you see it doesn't mean it's real, I say, okay. So you're showing me there's a real opportunity just because you said the opportunity is there doesn't mean you can actually build this thing and make it work. And we built it well, just because you built it doesn't mean that you can sell it.

That would be like people actually buy it. This is the mentality of investors, they want to prove all the way through. And then once you've proven all these things and removed any inkling of doubts, then they would like to buy you an evaluation about 10 cents on the dollar of what you're actually worth. That's the game, how it goes.

[00:23:52] Jeffrey Feldberg: So you started with your own money. You're now moving things forward. As the company began to grow, did you continue to fund it? Did you go for outside capital at that point once you had proof of concept, what did that look like?

[00:24:04] Ted Lindsley: Yeah. So we raised a couple million dollars after we built the product and introduced it and took it to market and signed $95 million in firm orders with a few million dollars in deposits.. In escrow. And then we went back to Silicon Valley, again, saying I need $10 million to get this thing done to certify this aircraft so we can unlock all these orders. And we spent 18 months trying to get that $10 million. Couldn't get it.

[00:24:31] Jeffrey Feldberg: Wow.

[00:24:31] Ted Lindsley: They just wouldn't believe it. I said you understand that these are not consumer orders. These are companies who've owned fleets of aircraft. They own fleets of helicopters that have signed an order and put money in the bank because they are experts.

And they understand the technology, you know, help me unlock these orders. We have a who's who list. Luxe, Bessemer, Andreessen, Sequoyah, Intel. All the A-list people would get through it and they'd get to the finish line. They go, we get it. We understand what you want to do.

And we think you're going to be successful, but we just don't know anything about aviation and this scares us. And so we don't want to put our money into something we don't understand. So we're out good luck. And that went on for 18 months until we just ran out of funding and couldn't finish it. And we had to park everything on the sidelines.

[00:25:17] Jeffrey Feldberg: Wow. So they had money in escrow you million in sales, just signed orders just waiting to happen

[00:25:25] Ted Lindsley: $2 million in escrow payments that we had to return. Talk about, and that's seven years in the making.

[00:25:30] Jeffrey Feldberg: Wow.

[00:25:31] Ted Lindsley: Having to turn the, and you still know you're right. And people in the industry are saying, why can't you get a lousy $10 million? That's that's crazy. And it's.

The product is way too early. Now you fast forward to about 2025. That product will be ready and it's in mothballs right now. In fact, one of them in a museum in California at the Hiller Flight Museum still is the only unmanned aircraft to begin a type certification with the FAA. But the industry is just not ready for it yet.

[00:25:59] Jeffrey Feldberg: So talk to us about your mindset, because here you were feet on the street. It's your own money. You actually, you had success, you had people drink the Kool-Aid. Hey. Yeah. We'll put some money in escrow. Here are some orders for. And then you had just closed doors all the way through. So what was that like?

 People can't see you right now, you're smiling now and you're a happy guy, but back in the day, what was your mindset like? And how'd you get through that challenging time?

[00:26:24] Ted Lindsley: Yeah. If I were a medic depressive, I don't think I'd be here talking to you about that. You learn in this business as an entrepreneur that you've got to level out the highs and lows. So otherwise, you're riding a rollercoaster going here. You gotta level that off. You fight and fight some.

And sometimes you get punched in the face and sometimes you win, but after 18 months, what are you going to do when everybody has turned you down and they just don't get it and you're out of funding you park. So in the case of that company, we just put it in mothballs instead of dormant.

And it's sitting on the sidelines right now. Until the market turns and that company has over 25 patents that are absolutely critical to the drone industry. And I see that there are companies just now beginning to encroach on some of those patents. So we'll just bide our time waiting patiently and then pop back up and goes through.

So that was a lesson learned on being way too far ahead of the curve for the product. And we thought that was the answer that we'll show everybody we're going to be so far ahead that no one will catch up to us. Instead, we're so far ahead that they can't even figure out what we're doing.

[00:27:27] Jeffrey Feldberg: Wow. And so you had this challenging time. You had really success at the beginning. It turned into a challenging time and it sounded like you had to then wind down the whole company. What next?

[00:27:40] Ted Lindsley: Yeah, but not just putting mothballs, not kill it. So it's just it's dormant you go more poignant. You go direct to where things are Right.

now and you say don't, let's not be 10 years ahead. Let's be two years ahead. We know the technology let's spend something up. So the third one I spun off is actually a mirror of my first company, which was hardware coupled with satellite communications. This one was hardware covered with cellular communications and so let's provide a drone link, a cellular drone link that provides an unlimited range for everybody to fly drones. And that was the technology we developed. And we partnered with Verizon and some of the other cellular companies and launched the first one.

And so that was started in 2018 with the goal of launching the product and services in March or April of 2020. How's that for timing?

[00:28:30] Jeffrey Feldberg: Yes, everyone knows March 2020. That is a time forever etched in our memories with the pandemic and the coronavirus. So, that must have been interesting.

[00:28:39] Ted Lindsley: That was a kick in the pants, for sure. Yeah, because everybody wants to do laboratory testing and field testing of equipment. So that really squash us pointed down a bit in our momentum, but we still were able to maintain it. And but certainly would have been a much bigger exit opportunity had we seen that without the pandemic

[00:28:56] Jeffrey Feldberg: So you worked your way through the pandemic with this, what happened?

[00:29:00] Ted Lindsley: So we're stretched for cash, but we're doing okay. But some of the investors involved wanted to take the business in a different direction and where I see it. And so an opportunity came up to pop out and they said we want to take this, but we want to run this direction with it.

I was like you're missing a much bigger opportunity. It should be here. And they disagreed as I, you know what? I can sit here and argue with investors and have to placate them month over month or month that I know what I'm doing, and I know where we're going. But when they said we would like to take this and run with it and go this direction, I said, sure, you got it.

So we worked through it and there you go.

[00:29:38] Jeffrey Feldberg: So that was a full exit for you, are you still involved?

[00:29:41] Ted Lindsley: No, I'm totally out now. So they've transferred everything last summer. And I thought it was going to take six months off And, just read aside what I want to do next,

[00:29:50] Jeffrey Feldberg: And so what you're, what you did next, and what you're doing it's interesting. I know offline you and I have had some conversations and you're all smiles. You're having a lot of fun, take you from the very beginning and to get you to your last exit and to where you are today.

I'm sure at the time, none of it made sense, particularly the challenging times, but as I look back on that journey, it's oh, okay, I get it. That makes sense. You have to do this first to get that perspective, then this, to get that perspective. So why don't you share with our community what's going on with you today?

[00:30:22] Ted Lindsley: Yeah. So I thought it was gonna take six months off and just reevaluate. When people got wind of me coming out of that company and being free, I started getting offers. Just people pounding me on LinkedIn saying, Hey, I heard you might be available. Would you like to come over here and be the president of this, the CEO?

And I said no. A guy I know here in. Was looking for a chief technology officer and he, for months he kept asking me, do you know somebody? And I kept saying no, but I'll keep it under advisement. And we had lunch one day and I said what do you want this person to do? And he told me I need him to do this and this and this.

And I cocked my head. I said that's not a CTA. That's me, you need someone like me and he said, what'd you do it? And I thought, oh, what did I just get myself into here? And so I said no. So I was saying, I don't know, I've been doing my own thing for 20 years and blah, blah, blah. But he convinced me to just look at it.

And so I sat in for meetings for a week. I signed a nondisclosure and I listened to the whole operation for a week. Meetings and zoom calls. And by the third one, I thought, my God, this is cool. I would actually enjoy this. And so I jumped in and took the title as COO. He's the founding CEO and he's a young guy he's very bright. He's actually a genius, literally a legit genius.

And so I've discovered that I'm loving being in the number two seat. After 20 years, I get to scale the business and drive the ship and turn the knobs and pull the levers. And I get none of the headaches that go along with being in the CEO seat. We're not taking any event, any venture capital he's adamant about.

He wants to scale it organically. I'm all about that. Bootstrap it one day at a time. Were turning away venture capital. Now, this is ironic for 20 years, I've been pounding the pavement, always looking for venture capital. Now I find myself in a venture where they're calling us going, hey, can we give you a check?

Would you like $5 million, $10 million? Can we get involved? And we're just saying, no, we're good. It's very different. And so I'm having a ball I should've done this 10 years ago.

[00:32:18] Jeffrey Feldberg: How the tables have turned. That's amazing.

[00:32:21] Ted Lindsley: I won't have the same liquidity event, as I would being the CEO and having, the big chunk of stock, but that's okay.

I'm actually, I'm loving what I do and I've found my whole career. If you love what you do, you actually get up in the morning, you're going, God, I just can't wait to get on calls and do things and make things happen. And that was what kept drawing me back to this. I've tried to retire three times in my career and I've failed each time because I would get bored.

[00:32:45] Jeffrey Feldberg: So from the vantage point of where you are right now, and you look at the CEO of this company and what he's doing, and I'm sure you have reflections you as a CEO, what's coming out of that?

Are you seeing the world differently? At least the business world differently because of your vantage point now, has anything changed for you?

[00:33:03] Ted Lindsley: More real, cause you were able to reflect back on your experiences, right? If I think back 20 years ago, I thought venture capitalists were the commanders of industry and they knew everything. And I worshiped these people, but having 20 years interfacing with hundreds and hundreds of them and seeing how they think and how they operate, it's just the opposite.

They just kinda seeing how the sausage is made. That's just not a whole lot there. So your experiences will definitely change your perception. Good and bad.

[00:33:30] Jeffrey Feldberg: And for our business owners who are out there, they're growing their businesses that are preparing for a liquidity event. And those that begin the preparation are very pleasantly surprised to say, Hey, you know what? The preparations a strategy are the preparations for growth.

And with growth comes higher profits and market disruptions, all those good kinds of things. What kind of advice would you be giving them as they're listening in and they're hearing your particular journey and you have some time now to reflect and think back. And it really sounds like you're back home, loving what you're doing and just having success right now that's beginning to build momentum day over day. What comes to mind as you think of other business owners and some insights and wisdom that you can share with them?

[00:34:13] Ted Lindsley: I find that most people do not, most do not think about the liquidity event. They're not setting out to build the business, to sell it. They just get an idea and they start the business. And then that path takes you through a winding course of obstacles that you have to overcome. If you're going to do that, you need to sit down day one and think this is what. I'm going to build a company to this stage, and then I'm going to sell it and go here. Or I'm going to build this as my family trust because I want my sons or daughters or whatever to take out of the business eventually. So you really have to think about that step in advance. I find that most people that are approaching a liquidity opportunity and more often it finds them.

They bump into it are completely unprepared And, they don't know what they want or how to negotiate it. If they're in a position where they need to sell their business or even less prepared, and they don't know where to look and what to do, they find that they're unprepared.

They haven't taken steps properly to go all the way through it. And that can be simple stuff. What's the name of the business? Is it your name, if your name is Williams, is it called Williams something? What you're going to sell that? There's just, there are so many angles to think about.

[00:35:18] Jeffrey Feldberg: And, it's amazing Ted because when you look at liquidity events and you're absolutely right, for our listeners, I hope you picked up on this. What Ted was saying was, hey, before you even begin a business, what's your ultimate exit going to be? Because when ultimately your exits going to be that's where you start and not the other way around and Ted to your point it's little wonder when you look at the stats, they're scary. It's up to 90% of liquidity events fail. And to your point of most business owners really randomly coming across an opportunity for a liquidity event. Well, It should come as no surprise that for most business owners 50% to over 100% of the enterprise value or the value of the business is left in the buyer's pocket.

Insult to injury the business owner never knows that. So again, you're preaching to the choir here, Ted at Deep Wealth in our 9-step roadmap of preparation of why it's so important. Day one, you begin to prepare for that liquidity event, even if it's 10 years down the road, five years down the road, 25 years down the road.

Preparation, preparation, preparation is the key that unlocks massive success in an enterprise value. So it's really terrific to have you here that that have you say that.

[00:36:28] Ted Lindsley: Absolutely. You mentioned a good point there too, because what 80 or 90% of startups fail as well. And then of those little percentage that are successful, the majority of their liquidity events also derail for them. So you have better odds of going to Vegas in some cases than doing that.

So there's a lot that has to go into this And certainly there's luck involved too. But if you're prepared, then that's going to cover a lot of the checkmarks for better chances of luck.

[00:36:54] Jeffrey Feldberg: And Ted with the preparation that you're now applying to where you are right now. And as you also have the benefit of hindsight, and yes, you did a lot of heavy lifting in the trenches and you got your Ph.D. at the school of hard knocks in regards to where you weren't prepared when it comes to preparation, what would be.

One, two or three things that really stand out for you? Hey, this time on the preparation side, I'm really going to make sure I put a checkmark next to this box.

[00:37:22] Ted Lindsley: I'm actually applying that right now at Invene where I'm the COO, when the CEO is 24 years old, he's a young guy who started college at 16 got genius degrees. So I was a little apprehensive about working with someone that young, but he's 24 going on 50. He's? That smart. And so I asked him what's your goal?

What do you want to build with this thinking that typical canned answer would be? I want to build this up to a really big company in five years and sell it. And James said I want to build the premier software development company in healthcare over the next 20 years. And I was taken aback by that because in his head, he had already mapped out where he wanted to be 20 years from now and how he was going to get there one day at a time year, over year, over 20 years without taking any investment capital.

So that struck me, that got my attention. And then when I came in and looked at what we got to work with and said, okay, we can bootstrap this. There are good margins. The health care industry is just explosive, really growing right now. And it will be for the next seven to 10 years. The market opportunity is right and it's now it's not future.

So I was able to just come in and reorganize the company and, provide an ESOP plan for the employees. So they have stock and the liquidity event for the employees is going to be an IPO, which is probably about seven to 10 years out. It's not selling the company, but it's an IPO. And ultimately long-term, you must to keep the company.

These are things you have to think about. And this is applying lessons learned in my last 20 years to what I'm doing today.

[00:38:45] Jeffrey Feldberg: Ted. I absolutely love that as you just map that out and you have a long-term plan when it's going to exit what that's going to look like, and that's really conditioning. Okay. How do we start and how do we get to where we ultimately want to get to?

[00:38:58] Ted Lindsley: It's not an exit, right? It's a liquidity event. But that doesn't mean you exit. When Facebook went public Mark Zuckerberg, didn't walk away. People misunderstand that is not your jumping-out point. That is, you're not parachuting out. When you buy anything, a car, a house, a product you're buying it because you want to get value out of it.

So anybody that's going to buy your company is expected to get a value out of it. And they see long-term potential out of that money they're going to spend on it. They might want you to involve, they might not, but either way, you have to look at it from their perspective that they're buying it because they see the huge value.

So what you talk about with your courses where you're maximizing that value, you've got to figure out what's it really worth to them? Are they low ball in here? Do they see a lot more value? Can you come to a better negotiation or agreement where both sides win which I find is the best way to do business if both sides win.?

[00:39:46] Jeffrey Feldberg: Absolutely a win for all involved and in three wins, very deliberately mentioned in there, but you're right. And with the 9-step roadmap of preparation, one of the things that we say is you'll come out of it. You will have developed the certainty that you're going to capture the maximum enterprise value.

So not any deal, but the best deal and the certainty that you've done that. And Ted for the benefit of our listeners, because you've been through this, you've referenced this before. A lot of business owners just don't get it. And maybe they've been bootstrapping it, perhaps they're going to be starting a new division or a new company.

And they see it in the movies and Hollywood, they read it in the books on the TV shows, and oh yeah, I'm just going to show up. I will invite some private equity firms. I'll just have a few meetings. I'll get this big check for millions and millions of dollars. Life is really good. I'm set and I'm done, and that's not the case. And that's why bootstrapping exists. That's why cockroach startups are around. Can you share for our listeners in your own, very real experience, the downside of really looking to attract outside finance, and outside money into the business?

[00:40:53] Ted Lindsley: Sure. That's firsthand experience. You're going to bring people in from the outside, providing money. Then they're going to want some oversight. They're gonna want to be involved to what level, how much are you raising? How much equity are you giving away? I'd never have a problem giving away equity. I have a problem with investors stepping in and trying to control the company.

I've always had a problem with that. It's my company. I've got the vision. I know where I'm going. If you believe in me, you're investing in me. So you're telling me that you believe I'm going to get there, but don't put your money in and expect that you're going to drive the ship unless they're coming in to do exactly that.

And that's a different negotiation, but usually, the investors want to be a passive investor. They don't want to be involved in day today. And you can see that in a Shark Tank, they just want to know that are you worth the money? And so think of it in that perspective, that when you're raising money for the investor, as important as the product and the services or whatever that you're providing, they're buying you.

Do you have the moxie to get there? Are you going to give up and just throwing the towel that easily? Are you willing to fight? And if you've got moxie. That's what it really is. If you don't give up and no matter what you'll pick yourself up and keep going. That's what they're looking for. And they're getting a test to you to see if you've actually got that.

[00:42:09] Jeffrey Feldberg: Lots of trials, lots of tests. And as you say, a lot of moxie, they get from point a to point B. Well, Ted, we're at the point where we're beginning to wrap up the episode and I have my favorite question. And the question for you is this, think about the movie Back to the Future. And in the movie, you have the magical DeLorean car, which takes you back to any point in time.

So Ted imagine now it's tomorrow morning, you look out your window and there's a DeLorean car. The door is open. It's waiting for you to hop in and you can go back to any point in your life. Perhaps it's Ted as a child or an adolescent or a young adult, whatever the point would be. What life wisdom or advice would you be telling yourself perhaps in terms of, hey, do this or don't do that? What would that look like for you?

[00:43:00] Ted Lindsley: That's a tough one to answer because the wisdom that I have today as a result of the path that I've chosen. I could say why would go back to this date And do things differently, but that just puts you in a different path and different lessons learned and, they could be good or bad. Advantageous or worse. So I don't know if that would change anything. I'm happy with where I am. That's probably not the answer you're looking for, but I really couldn't give you a date as I had to go back to there. And I would tell myself this.

[00:43:26] Jeffrey Feldberg: And I think that's a perfect answer because the takeaway is, hey, I am where I am today because things worked out perfectly. And maybe at the time, I put a judgment on things and I said this was a failure. This was a success. But in the grand scheme of things, I perhaps couldn't see that. But today with hindsight, it was all there for a reason.

There was a purpose for everything. And I love that. And for our listeners, it's a wonderful takeaway. Don't stress as crazy as it sounds. Don't freak out, know that you are exactly where you are right now at this point in time, because that's where you need to be. And your future self will thank you for doing what you're doing today to get there.

Ted I think that's a brilliant insight and wisdom for our listeners. And I'll put this in the show notes. As we begin to wrap this up, if someone would like to reach out to you, what would be the best place online that they can find you?

[00:44:18] Ted Lindsley: LinkedIn. I get at least 20 a day from people and reached out on LinkedIn and I respond to them.

[00:44:23] Jeffrey Feldberg: Terrific. So for our listeners, it will be a point and click in the show notes. We'll have Ted's LinkedIn profile there. You can click on it and boom, you can reach out to him and ask your questions and talk away. But speaking of talking, Ted, thank you so much for your time today and spending part of your day with us here on The Sell My Business Podcast. And as we wrap things up as always, please stay healthy and safe.

[00:44:45] Ted Lindsley: Thanks.

[00:44:45] Sharon S.: The Deep Wealth Experience was definitely a game-changer for me.

[00:44:48] Lyn M.: This course is one of the best investments you will ever make because you will get an ROI of a hundred times that. Anybody who doesn't go through it will lose millions.

[00:44:58] Kam H.: If you don't have time for this program, you'll never have time for a successful liquidity

[00:45:03] Sharon S.: It was the best value of any business course I've ever taken. The money was very well spent.

[00:45:10] Lyn M.: Compared to when we first began, today I feel better prepared, but in some respects, may be less prepared, not because of the course, but because the course brought to light so many things that I thought we were on top of that we need to fix.

[00:45:25] Kam H.: I 100% believe there's never a great time for a business owner to allocate extra hours into his or her week or day. So it's an investment that will yield results today. I thought I will reap the benefit of this program in three to five years down the road. But as soon as I stepped forward into the program, my mind changed immediately.

[00:45:47] Sharon S.: There was so much value in the experience that the time I invested paid back so much for the energy that was expended.

[00:45:58] Lyn M.: The Deep Wealth Experience compared to other programs is the top. What we learned is very practical. Sometimes you learn stuff that it's great to learn, but you never use it. The stuff we learned from Deep Wealth Experience, I believe it's going to benefit us a boatload.

[00:46:11] Kam H.: I've done an executive MBA. I've worked for billion-dollar companies before. I've worked for smaller companies before I started my business. I've been running my business successfully now for getting close to a decade. We're on a growth trajectory. Reflecting back on the Deep Wealth, I knew less than 10% what I know now, maybe close to 1% even.

[00:46:29] Sharon S.: Hands down the best program in which I've ever participated. And we've done a lot of different things over the years. We've been in other mastermind groups, gone to many seminars, workshops, conferences, retreats, read books. This was so different. I haven't had an experience that's anything close to this in all the years that we've been at this.

It's five-star, A-plus.

[00:46:56] Kam H.: I would highly recommend it to any super busy business owner out there.

Deep Wealth is an accurate name for it. This program leads to deeper wealth and happier wealth, not just deeper wealth. I don't think there's a dollar value that could be associated with such an experience and knowledge that could be applied today and forever.

[00:47:15] Jeffrey Feldberg: Are you leaving millions on the table?

Please visit www.deepwealth.com/success to learn more.

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As we close out this episode, a heartfelt thank you for your time. And as always, please stay healthy and safe. 

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Your liquidity event is the most important financial transaction of your life. You have one chance to get it right, and you better make it count. 

But unfortunately, up to 90% of liquidity events fail. Think about all that time, money and effort wasted. Of the "successful" liquidity events, most business owners leave 50% to over 100% of their deal value in the buyer's pocket and don't even know it.

Our founders said "no" to a 7-figure offer and "yes" to a 9-figure offer less than two years later. 

Don't become a statistic and make the fatal mistake of believing that the skills that built your business are the same ones for your liquidity event. 

After all, how can you master something you've never done before? 

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Enjoy the interview!