Bess Winston Contact Information
Elizabeth Shea (00:44)
Hello everybody and welcome to Branching Out. We're so excited to have you all here today. I am delighted to have Bess Winston in our office today and talking to us about what her experience was like when she went through an exit of her business. So welcome Bess.
Bess Winston (00:59)
Hi, thank you so much for having me.
Elizabeth Shea (01:01)
I'm so excited to hear from you. We heard about you from another colleague, and I've been so excited to get to know you better and your story. So, if we can just start with the beginning, tell me a little bit about your story, when you started your agency and then how you positioned appropriately for an exit.
Bess Winston (01:18)
Absolutely, I love telling this story. It's a fun story!
So, I think like many people, I was an accidental entrepreneur. My background actually is in the big agency world. That's where I spent early parts of my career. And I think when I was sort of in the mid-management heading towards senior leadership, it became a place that I needed to exit. It just wasn't right for me anymore. And I really didn't like that environment. So, I made a decision that I had never — me, miss “risk averse” even imagined that I did but I had an opportunity to take a one-year contract with a very visible IGO, very well known.
No safety net, no benefits, a start date and an end date. And I took it and I just said, “damn, the torpedoes!” Very, very unlike me. All my friends were shocked. But what happens when you take the leap is interesting because the energy that you then bring to yourself just starts multiplying. And sure enough, I had started to hear from former colleagues and clients who were interested in knowing what I was doing and then those former clients started bringing projects to me. And one of those projects was a very modest little media relations project. “Can you help promote this white paper?”
So, I read the white paper and I thought, “I can help you promote this, but this is more than a white paper. This is a campaign.” And so I took my idea to them, and they asked me to write it up, which I did. And this tiny, you know, under $10,000 project became a multi-year, multi-country seven-figure project. And that was it. We were on our way, and I never looked back after that. Quite unlike me. And here I am.
Elizabeth Shea (03:13)
Wow. What a great story. So, you sort of happened into this lifestyle, into this new business, and now you're running a business and you brought on employees, you had a team, additional clients, and you ran it for quite some time. Tell me about that.
Bess Winston (03:29)
Yes, I did. I had a two-word business plan. All the MBAs out there, you can come and challenge me, you're cringing. My husband's an MBA, but my business plan was make money. That was my business plan. If one plus one equals two, we're good to go. And I ran a somewhat conservative operation, which is to say that I did not grow fast. I was very careful about the people that I worked with and the team that I built. I had a very, very high standard. And I think that's okay. In the end, sort of slow, steady, the tortoise and the hare, that'll work. It took me about a decade before I was really in a position or ready to sell. But when we were ready, we were ready.
Elizabeth Shea (04:28)
So how did you know when you were ready and what did you do to prepare yourself for what might lie ahead?
Bess Winston (04:33)
Well, I think when I say we're ready, I mean, we were growing at a pace and in such a way that I was envisioning, how am I going to handle this next year or the year after that? We were sort of at capacity and when I say at capacity I meant from a sort of a leadership point of view. I was at capacity. I was a solo owner and founder. I did not have a partner. I was running out of bandwidth, and I realized that I can't do this by myself anymore. I mean I was also really tired. I think like many, I felt after all these years . . . there's so much hustle that goes into any business and any business owner will tell you that if you're not eating, drinking, sleeping the business for the first couple of years, you're not doing it right. That is what it takes. There is no shortcut. That is what it takes to be successful. So, you can't sustain that. And then it becomes a reflection of you. This is something that I created, I built, it was my baby.
I would be driving into work some days and I would panic because I'd be like, “my God, if I get into a car accident, who's going to lead the agency?” Or if I decide I've had enough and I want to walk away, all these great people and great clients who I've been helping, what happens to them? So, these conversations started becoming more frequent and I knew I needed a plan forward. So that was sort of like, “big gulp, take a breath. I got to figure this out now.” Now that's what happened.
Elizabeth Shea (06:16)
Yeah, you know, that's hence the name of our company, Treefork. You get to a point where you have to make a couple of decisions, and do you bring on a partner? How do you create a succession plan? There are so many questions that you have to ask yourself as an entrepreneur. So, I applaud you for recognizing that because sometimes it's too late when people figure that out. Hats off to you there.
So, tell me about the process of finding a suitor. Did you use a broker? Did you, did you do some research on your own? It's an onerous process. What did you do to help yourself?
Bess Winston (06:47)
Oh my gosh, that is an understatement. You know, I have so many — I don't want to call them regrets, but many sort of... Yeah, let's just say there were some hiccups along the way. Look, I will say this.
This is not like buying a house or other big financial decisions in your life that you probably get to do more than once in your life. This is a once at bat. It's very rare. Every business owner wants to sell their company. And the percentage of people that actually do it, you're in a rarefied club. But it means that you have very little experience doing this.
You get one shot, right? So, how you prepare and how you make the decisions, I mean, you know, a lot of us are flying blind no matter how smart we might be, which is also kind of the anomaly, right? Because smart people are the people that build businesses. And then when you go and sell your business, like, how did I become so clueless? But my process was that I was referred to a broker, and I wanted to check out that broker. So, I asked for some references.
And one of the references was the CEO of a very large, a global social impact firm that I kind of had known about and kind of admired. I said, I'll call this guy for a reference. So, I did. And I was talking to this CEO about the broker. Was he good to work with? Did you like him? And that conversation sort of became more of a conversation where the CEO was asking me about our company and more about what we did. And then the conversation sort of ended and he said, “well, if you're interested in selling your firm, I would be interested in buying it.” It was literally one phone call. And that started a process. I kind of married the first person who asked me to the dance. And maybe I should have danced with some other people, I don't know.
Elizabeth Shea (08:37)
I love that analogy! It's interesting how many people on the podcast talk about it in relationship terms. Getting married, getting engaged, all that other stuff. Interesting. So, you went through with the transaction. Did you end up using a broker in the end?
Bess Winston (09:02)
I did use the broker that was recommended to me. I think it's important to also share with people that this process is not something that happens in a couple of weeks. For me, it was almost a year. And it was lawyers and brokers and many conversations with the buyer.
The buyers, they do this a lot. The company that bought our firm acquired, I don't know, a dozen a year every year. This is what they did, they had a well-oiled machine. So, I just was a little intimidated and felt that I needed a team as well because of how they were doing it. Now in retrospect, I probably didn't. And in retrospect, I let that team that I hired, the lawyers and the brokers, talk me into things that perhaps I — in retrospect — shouldn't have done. So, I did use a broker, but I don't think you need one.
Elizabeth Shea (10:23)
Yeah, interesting. I mean, if you already have a buyer there, then that seems logical. So, you said that there are some things that you probably wish you might not have done. Could you share with things you probably wouldn't have signed up for?
Bess Winston (10:27)
How much time do we have?
(both laugh)
I think there's a couple of things. So, what happened to me in my experience — and I don't know how common this is, I'd be very interested to understand it. I think our firm was also a bit smaller than what is typically acquired. We were acquired because growth and profitability are measured lots of ways: revenue, people, or expertise. And because I had built this firm with this deep expertise and a very strong bench, we were at the table with bigger players and so we always kind of punched above our weight class.
Because we were smaller, it was intimidating. And I — again, a very smart businesswoman — get into this process and became stupid and clueless. I mean, I don't know what happened to me. I had people whispering in my ear, “take the deal, take the deal,” when there were things that I was concerned about. I didn't get the kind of leadership role that I wanted in the new firm. And I was told it wouldn't matter. And of course, those things matter. Of course they matter.
So that was that was a miss. And I think it would have been good for many reasons to explore several different types of buyers before making a decision. But you know, I had stars in my eyes. It’s very flattering, who wouldn't be flattered to have somebody come along and tell you that this thing created out of like nothing basically has value. Whether it's a dollar or a million dollars, it's flattering that somebody thinks what you've built has value.
Elizabeth Shea (12:29)
That is so true. That is so true. And I will say that you are not alone in what you have experienced.
Bess Winston (12:35)
Thank God. (laughs)
Elizabeth Shea (12:36)
All the people that so far that I've been talking to, this is their first time selling a business, first time at bat. And it's, it's daunting. You don't know what you don't know. You don't want to feel stupid because you're actually pretty smart. Of course you're smart, but you just don't understand the process. So that's the challenge. And so, I think that from the standpoint of you being able to share some of these experiences, it's been really helpful for people to know that they're not alone. That's really the key.
You are probably the third or fourth person that has said something along the lines of “I didn't get the leadership role I expected, or I didn't feel valuable after the process was done, and it was hard to feel my worth.”
Bess Winston (13:11)
Yeah, yeah. I mean, there is a lesson I think that somehow needs to sort of permeate the world of the buyer. And that lesson is — you saw something that has value, obviously. There's a certain kind of alchemy that's going on over there in that company that you've identified. So, I mean, come on, man, hands off!
Elizabeth Shea (13:48)
Leave them alone!
Bess Winston (13:49)
Yeah, like let the alchemy in whatever state that needs to be and continue at least for a couple of years. But there's this — I don't know where it comes from. And maybe I don't understand all the business ramifications, but I really don't see the downside of leaving the acquisition alone.
What the rush is — and it's usually by the way, it is not the CEO, because they are operating on such a different platform and they usually go away. So, you're left dealing with their leadership team. And those people are the ones that are messy and want to come in and sort of screw around with stuff.
There needs to be a real sort of wake-up call among buyers that if you want this to be successful . . . it's sort of like when real estate people buy up buildings and condos and stuff. Leave them alone. Just like have them be part of your little collection. Let us be part of your collection, but don't change us.
Elizabeth Shea (14:51)
Right, right. So how long were you there post-transaction?
Bess Winston (14:55)
I was not long in the duration. I think that it was clear that there wasn't going to be the role that I had envisioned. I was getting bogged down in a lot of nonsense. And I was slowly like every month bleeding from the person that I had been when we were acquired.
And it was the restrictions and the limitations and dealing with the bureaucracy. This was a world I had deliberately left. That's why I created my own environment and my own agency. I think too, looking back, the opportunity that was presented to us was that “we see your alchemy, we do think you're something special, and we're going to help cultivate that.” And of course, that didn't end up happening at all.
So, we missed the opportunity, but I was smart enough to realize — and I think anybody who's considering selling their company should — that the day you close, when you sign your name, you're done. And you have got to emotionally recognize it's over.
Elizabeth Shea (16:19)
So true. That is so fascinating.
Bess Winston (16:22)
And that kind of means that mentally, your exit's already happened. Now if you choose to stay on a little bit more, but I think you're already starting mentally to exit out of this.
Elizabeth Shea (16:35)
Right, right. So, what about your team? Did you share with your team that you were going through this process or with leadership?
Bess Winston (16:42)
Well, we couldn't do that. So, they found out the day of the announcement. I think we told them a couple of days before. I asked the buyer, I said, “I can't do this. I got to like slowly make them comfortable with this.” So I did. And I told them I think about a week before the announcement, before it was public.
I think this can be a very shocking thing to do because you're messing with people's livelihoods. Suddenly they have a new employer, somebody else is paying them, is their role changing, what's happening? And for us, the one thing that I did do. . . I think I can say this, I hope I can say this. I did everything I could to protect that team. I even — out of my own pocket, nothing to do with the buying company — cut them into the deal because I wanted this to be something we all did together.
But in the end, there were just so many things that were different and again they messed with the culture too much that it was very difficult in the end for the transition to really stick.
Elizabeth Shea (18:04)
Right, interesting. Well, thank you for sharing that story. And I think there's just a lot of good takeaways from that standpoint of communicating to employees. How do they perceive value? Who's going to pay their benefits, for example? So, there are some intangibles that you really need to think about.
Bess Winston (18:15)
Yeah, yeah. And I think it's important to say this because I want to be very fair. Our buyer, they had a very good process throughout this, and they were very good about ensuring that our team felt comfortable and all their questions were answered.
So, I mean, the process can be good — and in our case it was. They were very generous in promoting the announcement and teeing it up as a big success. I think they did a really great job. I'm very appreciative of all of that that happened. But culture is culture. And it's like, you don't know. A lot of people are the way they are, whatever. They take a risk, and we take a risk, right?
Elizabeth Shea (19:13)
Right. So how did you communicate to clients? Were any clients surprised?
Bess Winston (19:17)
So that was really scary, I will tell you, because you are their trusted counselor and they get nervous when there's a change in something that they think is right. And I did think it was interesting, a lot of times — again, we were a little bit smaller — we would hear from clients that say, “we would like to give this project to you, but we think we need a bigger firm or we need a firm with a more global presence. That we have business in Indonesia or whatever.
So, some were really pleased because they felt like it was a bigger deal to have a marquee name now that was their agency. I think others were really worried because a small firm, you have more of a boutique approach. I'm the founder, but I was involved in the client work, and the relationships were mostly mine. So, I think they were nervous. And I was nervous.
Elizabeth Shea (20:16)
Right, right. But everything went okay as far as you know?
Bess Winston (20:22)
Yeah, yeah. We didn't lose any clients as a result of the acquisition, not at all. And, you know, we worked really, really hard to make sure that our clients understood that nothing was going to change.
Elizabeth Shea (20:35)
Right, right. Okay, so you're past that, you've exited the company as far as I can tell. We'll talk about what you're doing next in a minute, but can you tell us what you might have told yourself as a former self? What advice can you give to some people here that are listening?
Bess Winston (20:42)
You know, I want to answer that but then I want to answer it a slightly different way. For me personally, I think I would say — just slow your roll. I mean this is a big, cataclysmic decision and I don't say that lightly. It will change your life. It will change your life. So, go slow.
And what I would say to myself is, don't be afraid to back out if it doesn't feel right. Or don't be afraid to ask what for what you need to make it right. I was just so intent on making this deal happen. I was just full steam ahead because it just felt like the right thing to do. I had stars in my eyes, all of that stuff. It just felt like “oh my god, this is what's going to happen next! I've got to make it happen.”
And there were some signs along the way that perhaps it wouldn't be as good of a fit for me. Honestly, looking back, if I had advice to share, do you know who I'd like to give that advice to?
Elizabeth Shea (21:53)
Who?
Bess Winston (21:55)
The buyer!
And all buyers, all buyers, not our buyer.
Elizabeth Shea (21:09)
That's a really interesting perspective. This is really cool.
Bess Winston (22:18)
I think that there's two things that buyers perhaps . . . and again, the idea behind this is to preserve your investment and to kind of like set up everybody for success, right? But the buyers need to understand two things.
One is that when you are acquiring a company from the founder . . . founders have a very intimate and emotional relationship with their business. And so, making that transition is really hard. And they don't understand that because for them, it's purely transactional. And for us, it's emotional. Now, I don't know if that's because I'm talking about women business owners, but I think it might be everybody.
Elizabeth Shea (23:07)
It's everybody. It's everybody. Absolutely.
Bess Winston (23:10)
Yeah. There has to be some deeper understanding that this is not an easy transition. There's a hole in my heart because of what's happening.
And then the second thing that buyers really need to understand, which is what I was alluding to earlier, is that . . . you have bought this company, or you're interested in buying this company for the growth potential that they offer you, whether that's in revenue or expertise or whatever it is. So let them do that. Leave them alone. Even things like, being allowed to stay in our space and having culture issues and some of those other things.
Leave the acquiring company alone at least for the first year and let them grow and give them the resources if they ask them. But I mean other than changing the brand, I'm not sure there really needed to be a lot of fiddling around or this insistence of integration. There was a real insistence on that and in the end I'm not sure it really it worked in such a way to make this a rousing success
Elizabeth Shea (24:22)
I totally agree and maybe the advice could also go to the buyers to slow the roll.
Bess Winston (24:28)
Yeah, yeah. Right, I think it's really important to note too — this is not a criticism at all of buyers. I think they're in their own way as clueless as we all are. Even if they've done it a million times, every deal is a little bit different. And I think that the intent — I know this for a fact in my case — the intent of goodwill is always there on both sides. It really was for me and still is. No hard feelings at all to the company that bought mine.
But it's the process of kind of learning each other and figuring each other out. And even if you do take your time, it is not easy. It's meshing a lot of things. It's you know, blended families. Blended families usually need counseling!
Elizabeth Shea (25:19)
A very true point! I love your analogies. I recall about a year ago coming across a statistic that said that nine out of ten founder-led businesses that are acquired, the founder doesn't last a year. And I thought that was fascinating. So, the expectation that might exist to have someone be there for a few years is probably unrealistic.
Bess Winston (25:25)
Yeah, it is. I also think that there needs to be some discussions about, if you had to leave, is not a mark of failure for either party. It does not mean that the deal shouldn't have happened. It does not mean that you as the founder are a failure. It does not mean that the acquiring company was a failure.
It was just — like I said, the exit happens when you sign on the dotted line. And some of those exits are slower than others. Some happen within months. But it's not a mark of failure if you did not integrate into that company or have a longer tenure at that company. Your success was building what you built and having somebody else think there was value there.
Elizabeth Shea (26:27)
That's a very real point, well taken point. So, what are you doing now? Tell me a little about that. I love your spirit and your energy!
Bess Winston (26:39)
You know, it's funny, I think a lot of founders would agree with this. It was so interesting that when I decided to exit, I think for the first time in my life — certainly the first time in a decade — I had time.
And time was a commodity that I never had before. Any founder or any business owner doesn't have any time. And so I used my time for a little reset. And that was really, really important to just reset on everything and truly to rest and to do stupid things. I did laundry. I did laundry for 18 months. I walked my dog. I just needed a reset. And so I took one.
And now I'm at a point where I am looking to, you know, possibly reengage. I don't need to — I may or I may not. But one of the things that is important to me is to share some of what I've learned . . . I don’t know if it's valuable to anyone or at all, but I feel like I've got this burning desire to especially give back to the next generation, whether they're business owners or just people in the workforce.
I realize the richness of my experience has value. And so now how can other people benefit from that experience? So I blog about it a lot. I have a new blog called Pearl Wisdom on Substack. And I'm sharing some lessons there and coaching and interested in doing some of that as well.
Elizabeth Shea (28:09)
Well, I think that the world can definitely learn from you and some of your successes and your mistakes or whatever challenges that you had.
Bess Winston (28:37)
Oh, for sure mistakes! I don't run away from them, for sure.
Elizabeth Shea (28:38)
We all have them! You learn the most from those.
What a great story. Thank you for sharing. I really appreciate it, Beth. We'll be in touch. Okay.
Bess Winston (28:43)
Yeah, it was my pleasure. Thank you for having me on.