Jake Bittner Contact Information

Email: jake@bittnerperformancegroup.com

Elizabeth Shea (00:42)

Okay. I'm very excited to be joined by Jake Bittner, who was the former CEO of Qlarion and will be talking about his experience today. So, welcome Jake.

Jake Bittner (00:50)

Thank you, great to be here.

Elizabeth Shea (00:51)

Yeah, it's very exciting to hear your story. And you're currently with the Bittner Performance Group, correct?

Jake Bittner (00:56)

Yeah, yeah, it's a group I started to focus on business coaching, advising, and investing in lower / middle market businesses really to help entrepreneurs go along the same journey that I did.

Elizabeth Shea (01:07)

That's excellent because I bet you learned some lessons along the way, right?

Jake Bittner (01:11)

Oh, yeah. We did this for about 10 years, and you don't go 10 years without learning a whole lot of new lessons, getting some scars.

Elizabeth Shea (01:18)

Yeah, absolutely. Absolutely. We're really excited to hear your story and maybe we just start with the basics. Can you tell us a little bit about Qlarion and what that business was like and how you started and why you decided to exit?

Jake Bittner (01:29)

Yeah, Qlarion, it's with a Q: Q-L-A-R-I-O-N. We were a data analytics firm. We actually spun out of a larger firm around 2010. There was a group of folks who were selling a company, and they had a handful of data of government contracts that they weren't interested in acquiring at that point. Myself and a partner of mine, Adam Roy, kind of scooped those up and rebranded into Qlarion. We used the Q as a kind of a neat branding letter.

Elizabeth Shea (01:56)

This is a nice branding touch.

Jake Bittner (01:58)

Yeah, it went well until we went to . . . this is another, this is a small learning. When we would show up at trade shows and they were like, okay, A's over here, B's, C's, Q's, right, we were in the back.

Elizabeth Shea (02:08)

But great for search engine optimization, I imagine.

Jake Bittner (02:14)

Yeah, but there's a reason why you look at the yellow pages and see, “ABC plumbing,” but anyway, other than that, it's a great name. We were focused on data analytics solutions. My background had been, the past 12 years selling data analytics solutions to the government space. I worked for Micro Strategy, Informatica, Business Objects. When I was at Business Objects, we got scooped up into SAP, and that was just too large of a company for me to work for. I knew I wanted to kind of do my own thing.

The opportunity emerged to kind of scoop up those contracts as I mentioned, and so we did. Adam's background was working for Booz Allen and was more on the delivery side. I was more focused on the sales side. Good partnership. So, we built the company.

The first few years, of course, we had challenges and struggles. Are we going to keep going? And are we going to be able to pull things together here? By year three or four or so, we felt like, okay, we're a going concern. But what are we going to become? That was when we started to dig into how we could optimize the company and how we could set some goals and objectives for ourselves and figure out how do we actually build this company such that it's valuable for us someday, whatever that might have meant.

Elizabeth Shea (03:31)

So, were you thinking about an exit when you were building the company? Was that even on your horizon?

Jake Bittner (03:35)

Well, it's interesting. This was like 2010-2011 when we started the company. At that time, we certainly had thought that, especially since we were picking up contracts from a company that was being acquired by Accenture actually. So, we thought, okay, wouldn't that something like that be a great exit someday. That was really the main avenue for exit around that time for sort of mid-market, lower-mid-market type of companies was to be acquired by a strategic of some sort or a larger firm of some sort.

We primarily were in the government space. We were primarily providing data analytics solutions for the government space. Private equity was in the government space, but really talking about the large funds spending billions of dollars to acquire large organizations. The smaller, the more mid-market PE hadn't really entered too much.

Then over the course of the next 10 years, you began to see PE come downstream in the government space and kind of get down to where we were. So, I think we knew that when we built the company, we were specialists in one area. We knew that we would someday potentially make a great data analytics division of a company. We wanted to give ourselves the strategic options to either do that or to keep on going and building the company into the future. I think it's still pretty clear, data analytics has a great future in really any market, but particularly in the government space. So, we felt like there was a lot of upsides for us. We could keep going or we could sell when the time was right. We knew that some point if we kept doing the right things, somebody would come knocking and we'd just kind of have to see what it looked like when that did happen.

Elizabeth Shea (05:13)

This isn't a plant, but the whole TreeFork Strategies model is about basically having to make a decision and knowing that there are multiple options for business owners. You can take a couple of different roads down that path. So, when did you decide that it was time to start looking at it and what did you do to prepare? Or did you do anything to prepare?

Jake Bittner (05:24)

Well, we did. All business owners, or let's just say most business owners, know that that's the potential that happens someday. That someone can come along, either when you're ready or maybe even when you're not ready and put that offer out there. That's kind of a goal in some sense. Your primary goal really should be around what you're accomplishing for your customers, and that was how we approached things. When we really got started, we were in data analytics world, but we were really a staffing company in the data analytics space. We would provide people with certain data analytics skills and other folks would sort of run and control the projects. We had a good team with good technical skills, but that was our primary value.

As we grew, we knew we needed to have more impact on our customer base and more impact on our customers in terms of our value we created. So, we really focused on how we could be more impactful to our customers, create value, and be seen as the ones who delivered that value versus sort of just a resume. And we were successful in doing that. A number of clients where we led the whole life cycle of analytics solutions versus just playing a part. We created a roadmap and a path for them for the future and really changed the way that their organizations operated around analytics. We knew that if we can get that message out into the world, we were doing it, but no one really knew about it in the customer sense.

That's where working with marketing, in our case it was REQ, really helped us to take those customer stories and get them out to the market in the right way. We knew that if we did that, it would provide value to us in several different ways. One would be getting that word out to the customer and prospect base, the potential new customers out there to really hear and learn stories of how we worked elsewhere. And then secondarily was really the partner market. So, for us partners, sometimes they were larger organizations that would look for an analytics partner on a program or a bid. And then sometimes they were the technology companies themselves who really often struggle to make sure that there's a competent organization involved in implementing their technology.

When we first engaged, I remember one of the folks telling us on the marketing side saying, this stuff you guys are doing for your customers is some of the best kept secrets in town. So, for us, it was all about getting those stories out into the marketplace. And I think we knew in the back of our minds that this is going to help us build the business, that those same stories are going to be of interest to lots of different people and potentially to acquirers down the road.

That turned out to be true, that unbeknownst to us as we're pushing those out and through these different channels and awards and other sort of things, we're becoming known in a certain space to our customers and partners and also becoming known to acquirers. That was really, ultimately from our perspective, the main goal, which was to give ourselves options of continuing to build the company or potentially selling to somebody should we get that offer you can't refuse.

Elizabeth Shea (08:31)

And in the end you ended up selling to G-Com, correct?

Jake Bittner (08:44)

Yep. We sold the G-Com, which is a private equity backed firm focusing on the state and local market, with IT solutions and services backed by an independent sponsor called SageWin. It took over a year from our initial discussions with them to really end up consummating a deal. Initially we were so focused on our customers and on growing the company ourselves, we didn't really think about it since we got a lot of interest from different people. But they were persistent and stuck with it and had a strategic rationale for why it made sense on their side. Long story short, which we could talk about a little bit too, we ended up working out an arrangement that we sort of decided we really couldn't pass up. A lot in that year went into deciding whether we should go down that path or shouldn't go down that path. Of course, lot in the negotiation and a very complicated process that I'd never been on before. That's the thing.

Elizabeth Shea (09:30)

Right, right. Most people haven't. Most business owners, this is their first at bat.

Jake Bittner (09:46)

Yeah, absolutely. It was in 2021 when we sold. Since then, I've been an investor now and I've been involved in a bunch of other acquisitions and investments. So, I've seen it and feel a little more comfortable with it. But if I put myself back in those shoes back in 2020, which is also during the pandemic, of course. There were a lot of factors that went into thinking about why we should go down that path at that point.

Elizabeth Shea (10:07)

So, you had multiple suitors, or you primarily just focused on this one, this particular one?

Jake Bittner (10:13)

The situation was, we had reached a certain level of growth, we had a significant growth spurt essentially. And we were at a point where we had to make some decisions. We had to either, reinvest in, some might call it infrastructure, but let's say some more of the team and some more resources and things to hit the next level of growth.

Elizabeth Shea (10:31)

Yep. Critical junction.

Jake Bittner (10:41)

Do we go ahead and make those investments? We had been at it for 10 years. And while it was enjoyable and fun, I know my business partner, Adam, and myself, felt like “hey, I don't know how much longer I can keep up this pace of intensity.” That was a factor. I mean, he was going to keep it up for some more years, but that was a factor. And I think we were also in this environment. So those things were kind of going on.

There was also lot of uncertainty obviously that time in the 2020-2021 timeframe. Didn't quite know how everything was going to pan out from a pandemic perspective and from a government perspective. It was unclear. There were a few other factors in there — I think the other big one was what they sometimes call the “Low-Interest Rate Phenomenon,” LIRP, L-I-R-P.

I remember they were consistently pursuing us and offers were kind of increasing a bit as we kind of were doing better. We came back to them and said “well guys, the business is actually doing better than that we're going have to you know …” Then they come back with a better offer.

I had gotten to know the people and we liked them, but I had a conversation with the CEO of my financial planning group which is a fairly significant group with billions under asset management. They arranged like 10-15 minutes for me to discuss the situation with him and he said this situation with the interest rates, like private equity can borrow so much money now that in just a few years, this won't be the case which is where we are right now.

You know, they're paying more aggressive multiples now than you're going to see in the future. He said to me, “you could work for the next five to seven years and end up with the same deal,” I said, “okay, that's it.”

Elizabeth Shea (12:36)

It's funny, as you know, I sold my business seven years ago, and I've often said, you just need to be ready to sell when the market's ready. You know, sometimes that's best time to sell versus when you're ready.

Jake Bittner (12:48)

Yeah, I think that's exactly right. You don't know exactly when that's going to be. So, being prepared for that is one thing internally, but then there's also, it's from getting your financials ready and everything else, but also being a company that people want to buy. Right? When the market turns and all of a sudden the M&A spigot turns on, they want to buy your company. They want the deal to go through. They want to make it happen. They're deal people. That's the other thing. I mean, among many other things to learn, you're dealing with deal people, not customer people. And that was one of the things we had to learn. We're so focused on the value we create for our customers, you're not dealing with financial deal people, which can be challenging in its own right. But you know,

Elizabeth Shea (13:27)

Right, right. Well, talk about that a little bit more. I'd be curious to hear more about that. What do you mean by deal people? What kind of things do you think they look for that you would . . . would you have done anything differently?

Jake Bittner (13:47)

There are definitely things we would have done differently looking back on things. You know, at the same time, we traded off here and traded off there, we only knew what we knew then. But yeah, you're dealing with people who look at things more from a perspective of how they can create the most compelling spreadsheet— or financial model, I'll just say maybe spreadsheet is little bit insulting — that they can take forward to a group of investors and lenders to create value in the company.

We always focus on creating value by delivering more value to our customers, right? Whereas the financial people look at a financial model and they think about how they can sort of finagle the numbers to create more value out of this, from a financial modeling perspective. And that's one perspective I think I really didn't have. I sort of assumed that they had the same level of care about or interest in creating value from a customer perspective, when it's really financial engineering that they're experts at.

They certainly understand that, you know, they appreciate the customers and they want the customers to have value and that sort of thing. But that's not where they're trained or where their mindset is. Their mindset is on the financial engineering side of it. And that's when they come in, you know, think about the due diligence process, when they come through the due diligence process, that's where their mind's coming from is, how do I translate all this stuff into a financial model that I can get the loan on, that I can get the investors behind? That's one of the main focuses on their side. And I didn't fully appreciate that. I think, lot of the questions and things that come through due diligence, you kind of go, wait, are they questioning how we do things? Are they questioning whether or not we're really worth acquiring at this price? No, to put it succinctly, they're just trying to figure out how to convince the lender that you're worth acquiring at that price.

Elizabeth Shea (15:45)

Yeah, no, that's a very good point. And that's the big difference between a strategic acquirer and a financial acquirer. Of course, both will go through due diligence processes, but a lot of our clients and potential listeners are probably making that decision, whether or not they want to go the route of a strategic versus a financial private equity type of scenario. And so, yes, there's going to be a different level of priority and the focus is going to be on the growth and the hockey stick capability and all that other business.

And so sure, they have to convince their lenders. It's not unlike buying a house if you really think about it. You got to get the appraisal to make sure that the bank going to approve it. So, I don't know why I threw that analogy in there, but it kind of makes sense. So that's very, very interesting. it's important not to lose sight of that, it sounds like.

Jake Bittner (16:19)

Yeah, I think that's true. That's an important thing. One of the challenges you're alluding to that I think is out there for folks, when I say they're “deal people” also, the other thing is that they've done this dozens of times, right?

Entrepreneurs, for the most part, they’ve built a business knowing they would sell it someday, but they’ve never been through it. And you only have one, right? We have one business to sell, while they could buy any business out there — they could buy mine, this one or that. In theory, they can do dozens of deals.

Elizabeth Shea (16:54)

Right.

Jake Bittner (17:08)

I've only got one to do, right? And the other thing, talking about other pieces that were surprising to me, and we can talk about this a little bit as well, is just how much of my personal identity ended up getting tied up in the business, you know?

Those factors are all on the entrepreneur side, right? The personal tie in with the business, the people, the customers, the fact that you're only probably going to do one of these, maybe you'll do two of them or three. Either way, it's a lot less than they're going to do this year, you know, or this quarter even, right?

Elizabeth Shea (17:43)

Right. So, there's a side to this that you probably hadn't anticipated.

Jake Bittner (17:55)

Yeah, the point I was kind of trying to get to there was that there's not a lot of education on how you figure out how to go through this. It’s a lot of self-educating, right? Self-educating, talking to others who've been through it. There are some webinars and seminars and things you can go to. In almost all of those, somebody's angling to sell you something, whether it's an investment banker or a lawyer or this or that. So, there's always a little bit of a bias in those discussions. There's not a lot of ways to figure out to help yourself learn how to go through it. Having been through it, I learned a lot going through the sale process.

I've heard this now a lot in other deals I've done — every deal dies two or three times before it gets done. So, when a deal starts to die, the deal people go, hey, this happens, right? But when you’re an entrepreneur and it's your whole life and a deal starts to die, it's like, oh, God, oh my God. It's very difficult, you ask “why is it dying?” It's dying because they're calling your baby ugly to some extent, right?

So, it's very personal and you just don't know what you don't know. I don't know what's a better way for people to learn that stuff besides number one, going through it. Number two is probably just talking to as many people as possible, like listening to a podcast like this where you're talking to people about going through it and learning about the experience.

Elizabeth Shea (19:34)

Yeah, and what to expect. I mean, I think that there's so much that you can learn from other people that have been through it, but you may not know who those people are. So again, that's sort of the spirit of this podcast is to share your story and to a certain extent, if people want to reach out, they can do that, correct?

Jake Bittner (19:38)

Yeah, absolutely. So, it's interesting. After you sell the company, what then? Well, for me at least there were two phases. There was a phase where I was still with the acquiring company and then there was a phase sort of after that. It is definitely eye-opening to have been in charge for 10 years and then to not be in charge.

Elizabeth Shea (20:07)

I know that feeling.

Jake Bittner (20:16)

Yeah, yeah. The first thing that comes down is like, “we don't do things like that around here. We do this.” You're like, okay. Well, because usually I just kill those things and I do what I think is best, you know?

Yeah, everyone knows when they used to work for big companies. For some reason, there's always stupid things big companies do, right? And I remember being in our company and I was like, well, we just don't do those stupid things. Somebody says if we determine something's dumb and it's pointless, like an HR thing that we do every year, it's like, guys, everyone hates this, this is stupid. Let's just not do it anymore. It doesn't work that way at big companies and we do it anyway.

Elizabeth Shea (20:37)

No, it doesn't. So, you had a little bit of a culture shock, it sounds like.

Jake Bittner (20:55)

Little bit of a culture shock. Our approach for selling was different than the approach of selling at the firm we went to. That was a bit of a culture shock. But they did some good things too in terms of getting people to adopt to a new brand. People were so used to just everything they had thought about. Our people had thought about a Qlarion brand. They sent out a package of all sorts of stuff and people started taking pictures of themselves biking or this or that, wearing the new gear and that sort of started to get people a little more comfortable with it.

But there's just so much related to the shock of moving over to someplace else. You also have to think bigger. Those groups operate with another zero or two at the end of their contracts usually. So, you've got to think bigger and play bigger. That means there are more resources to some extent, which is great too, but they are still managed. So yeah, there's definitely a shock and moving over there. There's a whole integration component that can be challenging.

One of the things I know that we did that was helpful was when we knew we were kind of going, there's always this period of time before the deal's closed when it's like, who do we tell, right? Who do we tell if this is coming on? When do we bring our certain team in? We had a core management team. We brought them in relatively early on. And then as things progressed towards closing, because you don't want to tell people the deal's happening and then all of sudden it falls apart.

Elizabeth Shea (22:08)

Right, yes, that's a good question. That's always the risk, sure.

Jake Bittner (22:23)

That's the risk. It's also people are always concerned they're going to leave and this or that because there's always this assumption that acquirers are going to fire people, which isn't the case, especially in the people business. I guess it can be the case, but in the people business is not the case.

Elizabeth Shea (22:37)

Typically, it's not, correct.

Jake Bittner (22:41)

So, as we got closer, what we started to do was internally message that we're at an inflection point and we've got to do something. And I'm working to try and figure out, you know, our executive team, we're working to try and figure out what that's going to be. It could be this, it could be that.

Elizabeth Shea (22:57)

That's a great idea.

Jake Bittner (23:00)

It wasn't like we were BSing people. We really were at an inflection point. There were a lot of things going on in the government space at that point that were creating uncertainty. And we felt like we needed to find some sort of a strategic path forward, whether that was an outside investor or what have you. So, when we ultimately announced it was “guys, good news! Remember that whole challenge we were telling you, we figured it out.” And everyone goes, “great, awesome!” We could have easily punted that decision too, right? If the old have fallen apart, we could have said, well, you know, we took plan B or plan C . . .

Elizabeth Shea (23:29)

That’s excellent. That's really good counsel.

Jake Bittner (23:45)

But we set it up such that when we announced that everyone was really excited about it and they weren't nervous about it because we had sort of told them something was coming. We just weren't sure what yet.

Elizabeth Shea (23:55)

That's a really big question that a lot of people ask and lot of entrepreneurs are worried about telling their team again, because it may not go through, but that's a really, really good idea. I love that.

Jake Bittner (24:05)

Yeah, that was good. The other thing I was going to mention was that for me, learning wise was just how much of my personal identity was really wrapped up in the business. Not just being the CEO of Qlarion, but being there for my team and for my people. That was important. Like all of that was who I was. I was inseparable, you know. A good simple example is like personal email. I didn't have a personal email. I owned the company. I didn’t want to get a personal email for it. You're just inseparable. It's one of the same, right?

So, when I ended up leaving GCOM, leaving the acquisition, we, took some time off trying to figure out what I wanted to do next. I'd never really thought about it. Because we did the deal because of the situation, the proverbial offer you can't refuse slash conditions and everything else. It wasn't really that we said — okay, well in three years we're going to sell, and three years came around and we sold it and I had a big plan of what I wanted to do next. I didn't.

Elizabeth Shea (25:13)

You didn't?

Jake Bittner (25:14)

No, so it really took me quite some time to number one, separate myself from the company and kind of rediscover who I am and what I want to do and what I enjoy. The beauty of it is that I have tremendous flexibility, financially and personally in my time and what I want to do now. But it's kind of like, well, what do you do then? Do you do nothing? Okay, I did that for a little while. It's kind of boring.

Elizabeth Shea (25:31)

Did you practice your golf swing? Or you picked up skiing, right?

Jake Bittner (25:50)

I mean it’s just silly. There’s literally no one to hang out with like in the middle of the day, right? It's like, “oh, you guys want play tennis?” “No, we have to work.”

But I did find a few things that obviously I can enjoy. I love skiing and we've done a lot of travel. My wife and I skied 40 days out West last year. We did a month in Colorado. So, it's a lot of great things like that.

Jake Bittner (26:07)

For me then, it was kind of like a path of rediscovery. What do I want to do? I first started investing in companies and that was great. Did well financially, but I really wanted kind of a deeper engagement. And so now I've gone down the path of really formalizing myself as a business coach and getting certified on a framework and a system that is very, very similar to what we ended up using at Qlarion, except that it took us 10 years to figure it out for ourselves rather than someone coming in and saying, here's the best practices of how these things work. Built around the core concepts that I've always embraced, which is kind of from Jim Collins’ “Good to Great,” how you build a company to be a great company. And one of the core concepts within that of “first who, then what?”

There's the hedgehog concept, there's the flywheel, the BAG, all these sorts of components of Collins philosophy that ended up at the core of what we did at Qlarion. But gee, it would have been great if I would have known this stuff a lot sooner. And if I had to do over it again, that's really what I want to do is kind of help people who are in that path now to figure it out quicker, to learn from the things that I did. So, that's where I decided to go on the path of business coaching. I'm just starting down that path, continuing to invest in companies as well as coaching. I'm just starting on that path. It's so far so good. It's a lot of fun and enjoyable for me.

Elizabeth Shea (27:14)

Yeah, I will say that before I sold my company, we used a coach with a very similar framework to what you're discussing and probably, we probably worked with him for three years and it changed everything. So, hats off to what you're doing because it's really valuable. For anyone that's interested in that, I think that's a really, really smart council. So, Bittner Performance Group, right? Sorry, I'm giving you a little plug.

Jake Bittner (27:37)

Yeah, that's the name of performance group. We can help you perform. Group is still evolving, but for right now, it's just me.

Elizabeth Shea (28:03)

That's excellent. So, just before we wrap up, is there any piece of advice that you could give folks, something you wish you would have done differently? We've shared a couple of things already, but any lasting piece of advice you'd like to share with our listeners?

Jake Bittner (28:18)

The thing I always say is, number one, be careful where you get your advice from. That's the first piece of advice. Something I wish I would have learned along the way and would have done differently — one thing I'll say that I'm glad I did do in the right way, I'll encourage, but I know a lot of folks don't, and that is take care of yourself.

That is the number one most important thing for a CEO to do is take care of yourself mentally and physically. I would leave the office at 5:15 every day to be at my Orange Theory class at 5:45. It didn't matter what was happening, I'm out because I know that I have to take care of myself so I can be sharp not only to be in good physical condition but my mentally sharp. You know the impact that you really have as the CEO is not so much doing all the work, it's the decisions you have to make and needing to be mentally sharp to make those decisions.

You know, a small number of high impact decisions. Of course you're going to do other work along the way too. But I think taking care of yourself mentally, physically, your family, your relationships, whatever else, your faith. Putting those things first in your life, those problems and whatever you're dealing with in the business today, they're going to be there tomorrow. There are going be new problems. You solve these. That's the life. It's a never-ending cycle.

So don't put off taking care of yourself because you've got some challenge today. Go running, go yoga, go do whatever you're going to do. But have a plan, take care of yourself. And if you do that, you'll be in a better position to solve today's problems and tomorrow's problems. So, take care of yourself is probably my number one piece of advice for people.

Elizabeth Shea (29:44)

Right, that's very true. All right, excellent. Well, I love it. Well, thank you so much for your time today and for all your counsel and advice. It sounds like you went through an amazing journey. So, appreciate your insight. Okay, we'll talk to you soon and we'll share your detailed information in the transcript.

Jake Bittner (30:13)

Yeah, thanks. That'd be great. Best way to reach me is probably through LinkedIn. I'd be glad to hear from you.

Elizabeth Shea (30:23)

I understand you're a LinkedIn aficionado for the puzzles.

Jake Bittner (30:28)

Yes, I do love the puzzles. It's so funny, it's just my 10-minute thing every morning. But it sucks me down the LinkedIn hole, which I appreciate for 10 or 15 minutes every day.

Elizabeth Shea (30:35)

That's excellent. Okay, we'll find you on LinkedIn. Jake Bittner, thanks so much.

Jake Bittner (30:39)

Thanks.