Who's Really the BOSS?

There may be errors in spelling, grammar, and accuracy in this machine-generated transcript.

Rachel Dillon: Hi, I'm Rachel Dillon, and together with my husband, Marcus Dillon, we lead Who's Really the Boss podcast, where we highlight the joys and challenges of running a business with your spouse or family. Our mission is to strengthen families and businesses by helping listeners avoid the mistakes we have made so they can lead.And live happily ever after.

Rachel Dillon: Welcome back to another [00:00:30] episode of Who's Really the Boss podcast.

Marcus Dillon: Hey, thanks for having me back.

Rachel Dillon: Today's been interesting. We. This will come out later, but we've already been to the airport in Houston and back. We've already had meetings, and it's only 11 a.m. our time. So, um, today's already kicked off. I feel like we've already had enough conversations today for the day to be ending, so. And not, you know, just starting.

Marcus Dillon: Yeah, it's a it's a Monday on recording this. So whenever [00:01:00] it comes out, it's also Monday. So it's quite the adventurous Monday for us. And uh, out of the routine a little bit didn't get the normal start to our day. So we'll see how the rest of the day goes. But yeah, it's it's fun. You roll with the punches.

Rachel Dillon: Yeah, absolutely. So fun conversations this morning. But I really want this episode for us to be more like storytelling. So I want to hear I sometimes I get to hear pieces of conversations that you have with our accounting [00:01:30] clients. So with the clients that you are the client CFO for, they either meet with you on a monthly basis or on a quarterly basis. And every once in a while, I'm in and out. Since we share an office and I may hear a little bit about what's going on, but we recently shared in DBA firm what a meeting agenda looks like for your CFO meeting. So today I just want to test you and see do you actually follow that agenda? What does it look like in real life [00:02:00] when you have those conversations with your clients?

Marcus Dillon: Yeah, this is really good and timely. Obviously, we just wrapped up Q2 mid-way into July when we're recording this, but have had a lot of client calls, whether they have a quarterly touchpoint, which is the majority of our clients, or if they have a monthly touchpoint, have already had some of those conversations. So this is timely. Um, 2024 is going by fast. It's also a different [00:02:30] type of year. It's an election year. So there's always that. And what a what a year for that. Um, but I think this is very timely because we have released that resource. Leslie, the other CFO, she follows that resource. She is much better at following resources and a regimented schedule than I am. And so I would say that a lot of my clients client CFO meetings try [00:03:00] to follow that. But then it also weaves into let's just say it depends. Right. So the the accounting term that is used way too often. It depends. It depends on what my client meetings look like. So I think some of the stories that we'll go through today, um, follow that pretty well in some manner, but loosely there's, there's always tying back to the overall objectives of that meeting are those five points [00:03:30] on that deliverable that we've given folks.

Rachel Dillon: Yeah. So this episode really is for anyone who is serving clients through advisory, who wants to serve clients with advisory and really just talking through what does it actually look like to sit down with a client for 30 minutes to an hour and, and let them kind of have the floor and direct the meeting with some sort of boundaries and guidelines and flow to the meeting so [00:04:00] that it's productive for everybody involved. I know a lot of people ask us, you really have clients that pay you $2,000 plus per month. What do you do for them that they're willing to pay you that much? So I think this gives a little bit more context of what we do for them. Our team serves them week in and week out. That's part of it. And then the other part of it are these advisory conversations. So you referenced the [00:04:30] kind of five points that we it's just to give a structure to the meeting, just in case. A lot of times the clients could direct that meeting, you know, the whole time and let you sprinkle in some words of wisdom. But really, these five points give some structure.

Marcus Dillon: Yeah. I, um, I like following the structure. I kind of always have best intentions going into it, but my style, I am able to respond quick and kind of add my $0.02, and then [00:05:00] as long as the meeting ends with zero follow up on my side. Like me personally, it's a great meeting because that's where I don't shine. Um, so you mentioned $2,000 a month price point. I would say that's the minimum. Now for our premier clients, we have some clients $6,000 a month, $8,000 a month. We have one client that just brought over a family of entities that were at $15,000 a month on that client. [00:05:30] I will say, as a CFO, both myself and Leslie, we have the least percentage of budget on those clients because majority of that time goes to the other team members. So our fractional CFO, which is such an overused term now in the market, uh, our CFO services, our client CFO services aren't the majority of that budget. I want everybody to understand that because the team gets [00:06:00] the majority of that budget, and then what we're able to do when we come alongside the rest of the team and the client and sprinkle in the advice, that is the culmination of our experience and everything we see happening in the business. We don't need much budget for that, and we're there to okay. If there's something on the follow up side, who can I delegate that to on the team? And that's the other piece where that's what we've created that is different [00:06:30] than what some other firms may consider, like CFO services or fractional or outsource CFO services. But this is what works for us because we believe in team, and the team gets the majority of that budget.

Rachel Dillon: Perfect. Okay, so the five the five points and the secret here is the agenda or kind of the structure of that meeting was developed After you were already having those meetings. So taking it way back to when you were the only client CFO again, [00:07:00] I overhear. So I was able to kind of put some structure around what was naturally happening in those meetings. So I think that's kind of your normal M.O. is to do it, and then we'll write down the steps after it's been done a few times, like test it out, try it out. So this is really kind of naturally the flow. So typically the meetings start with a time of connection between the CFO and the client. Um priority investigation. [00:07:30] Just meaning what's important to the client during this meeting. So at this point in time of the year, what's important to them. Uh, financial analysis then strategy, which is where you get to sprinkle in some words of wisdom. And then last kind of the action plan, giving to do's or action steps for both sides, for both the client and then potentially for our team. And so those are really just kind of the structure of what every CFO meeting looks like, whether they're a monthly [00:08:00] client or a quarterly advisory client.

Marcus Dillon: Yeah. And we try to do that over 45 minutes to potentially an hour. Um, my CFO client meetings are 45 minutes, but it does block out a whole hour just in case someone can't come up and block another meeting on my calendar. Um, I will say the clients that I enjoy, um, and really, you know, you would spend time with in or outside of the professional relationship, uh, we could go [00:08:30] for days, right? And just on the one part of just the connection, the catching up, because we both enjoy each other's company. Um, some clients aren't that easy. Some clients. I'm looking at the clock on my computer screen saying, I got to make it 45 minutes. I got to make it 45 minutes. Um, just because it's like the the relationship or what they are wanting out of the relationship. Out of the advisory side may feel uncomfortable. So even though we've been doing this for years, even though I feel [00:09:00] confident in how I can walk through these relationships, it's it's never easy. I'll say that to to folks that are listening, because it's dependent upon the relationship that you have with those people on the other side of the camera. So but yeah, you touched on it. So connection priority investigation, financial analysis strategy and then action plan.

Rachel Dillon: Yeah, absolutely. All right. So you mentioned it. We're just finishing up a quarter. You've been having meetings [00:09:30] kind of most days for a couple of weeks. So that's kind of the time period. That's what it looks like. You send out your calendar link for people to schedule at their convenience. And so those just kind of land where they land. Now you have your schedule blocked when you don't want to meet with anybody So they can't choose those times. But all the times that you've allowed, they can kind of pick from there. And really ideally for us, we would want them to pick within, you [00:10:00] know, 1 to 2 weeks of sending out that invite. We don't necessarily want them to schedule for six months down the road. That would mean that they had missed a service offering. So, um, that's typical for clients to schedule within a week or two of receiving that calendar link.

Marcus Dillon: Yeah. So you kind of teed that up. So client controller sends out the monthly financials. They send them out with commentary. They send the PDF or the link to the PDF of those financials with commentary. [00:10:30] They'll also put some bullet points in the email to just kind of give an overview of the results of that month. And even if that month falls on quarter end for a quarterly CFO touchpoint client, they send that out. So when that goes out, we're obviously watching that project flow through the different stages from CSM to controller And then whenever it gets onto my dashboard, I also see that email come across. But I've probably done some work hand in hand with the controller, or kind of asynchronous, if you will, on my side [00:11:00] to do some additional reporting or analysis on a quarterly basis, or even a monthly basis on a monthly CFO touchpoint. And then once that controller sends that email with those financials, then I respond all with my additional input if I'm giving a deliverable. So it has a deliverable and additional commentary on just my piece, if there's some additional fpna, whether that's a cash flow projection or some type of additional expanded reporting that we do. But then also I'm [00:11:30] pointing to my calendar, right? I'm like, hey, you've seen these financials, you've listened to the commentary or the additional pieces that we do.

Marcus Dillon: Let's have a better conversation on the other side of this. Now that you've at least seen this, because they come and ask better questions as opposed to let's see how you did. Right. You know, sometimes we have that conversation, but not a lot of times it's usually like, what do you see here? What should I be doing all of that. So yeah, that just happened. So [00:12:00] we send the financials before the 15th of the month. It gives me time to respond. And then they book hopefully the 15th through. I would say the next three weeks is ideal because then it's still fresh. It's still relevant. Or if they book later than that, I've kind of got to pull in some of that most recent month into my analysis and conversation because, you know, if they don't book until August or September, I do have to pull in July or August financials [00:12:30] just because things have changed. And we always want timely, relevant financial information to make decisions. And I can't go back and just say, oh, at the end of Q2, this is what it looked like. So you are exactly right. Like two weeks is ideal, but sometimes it stretches further based on life, vacations, summer, all the fun stuff that we're dealing with right now.

Rachel Dillon: So what is how is scheduling different for the clients you meet with monthly? So that doesn't happen? [00:13:00] Yeah, I.

Marcus Dillon: Know on that one. We actually set days and times recurring days and times. So one of my clients I meet with the second Thursday of every month at 10 a.m.. And that just is automatic on their calendar. It's blocked out. It's blocked out on my calendar. Another one will actually go grab lunch or breakfast. And we know that it's the third Monday of every month. So it's just those recurring ones on the monthly clients are great to get on. I do have another monthly CFO client [00:13:30] who likes to go to lunch, and it's a little bit more flexible depending on when he's in town. I will say that it's harder to schedule because there's just stuff, right? You know, you have to be like, hey, does this day work for you? Does this day work? And so if you can always set the day and the time to be recurring, especially on monthly clients, because that's just going to set both parties up for success.

Rachel Dillon: Yeah, absolutely. Let's go through the first one. So I'm going to ask you kind of through the structure that we have [00:14:00] for those meetings to tell to, to walk us through what that most recent meeting looked like. So let's go with, well, which client do you want to go with first to kind of tell about the last advisory meeting?

Marcus Dillon: Yeah, we picked three clients for today. Let's go with one of my monthly CFO clients who's a marketing agency. So they are a marketing agency. They do about, I would say, 3.5 million to 3 [00:14:30] million a year. And, um, where they're at today, they're actually looking at acquiring a vendor of theirs. So they do a lot of research projects. And one of their vendors, the research Agency. They believe that there would be some additional synergies by acquiring them and kind of bringing that work in-house. So that's going on right now. Um, so we can start with that marketing agency. Perfect.

Rachel Dillon: So what [00:15:00] does the, um, connection time look like? What did the connection time look like specifically without identifying who it is or sharing any private details? But what is the connection part of that meeting look like?

Marcus Dillon: Um, it usually starts off with, hey, man, how's it going? Like, this is a young owner, probably in his late 20s or early 30s. I don't exactly know his age today. I don't want to, you know, kind of throw something out there and be wrong. He is from the Austin, [00:15:30] Texas area. He actually lives in Colorado. The whole company is based out of Colorado. So this is a completely virtual relationship. Um, that came in the door. And so as listeners are thinking through that too, like, this works in a virtual environment as opposed to only in office or across the table at lunch, so we'll catch up. We've gotten to know him over the last couple of years, obviously, so we know what's going on in his life outside of the business. Obviously it's Colorado, so we always talk about how great their [00:16:00] weather is compared to the Houston, Texas area. So, you know, you kind of show your age whenever you lead with weather conversations. But hey, it works. So if you don't have anything else to talk about, talk about the weather. And I think that's where you can initially kick it off that way. But for him, I know that he's also in a couple of different groups, like he's in a Vistage group or an EO group. So a lot of our owners are in those where they're surrounded by other business owners, [00:16:30] which is good and bad, because sometimes you have to combat the advice that they're getting from others. So I'll ask, you know, hey, what's going on in your, your vistage group? Like what's, you know, what's the latest? And so we kind of get caught up just talking about general business because we both enjoy business. Right. And so there's that connection in common that we have. So always find that in common connection, whether that's business teams like sports teams, kids activities, things like that. Because [00:17:00] that humanizes the relationship so much easier. And then that way you can actually connect a little bit better throughout the numbers that you're you're speaking into.

Rachel Dillon: Yeah, absolutely. Um, yeah. That's great. Priority investigation. What were his priorities on this last call?

Marcus Dillon: Yeah. So there's a lot of stress in his life right now, so I kind of have to talk him off the edge because the main marketing agency we've seen pull back in that industry [00:17:30] over the last year and a half, two years. Just the response in overall economy. Um, so we're watching a few different things. Also, he has this, um, acquisition potentially on the horizon that we've been working through for a couple of months, doing some due diligence on there as well. It's just not going as fast as either party would like. And he does have other stakeholders. So his attorney, his financial advisor who are involved in that so that that part of his life is definitely priority. [00:18:00] We need to know, are we moving forward, what pace are we moving forward? Just so I know that too. And then I can bring other team members alongside me on the DBA side to support me, support him. So it's it's all set up for success. The due diligence piece, a lot of listeners, whenever you work with small business owners, especially on a month to month or quarter to quarter basis, you know that whenever they are enthralled with something like a merger [00:18:30] or an acquisition, the core business could potentially lose focus. So we're trying to keep him focused on core business, which he serves as the main sales Salesperson as well. So we're looking at numbers in the core business and priorities there, in addition to the priorities of the overall long term plan of his business, which may include M&A.

Rachel Dillon: Yeah. Yeah. And sometimes those meetings, if I catch any of that, will feel [00:19:00] a little heavy from my perspective. So as far as financial analysis, what is important to him, there's I mean tons of data that you have, um, collected and calculated and can present. But as far as the business owner of this marketing agency looking to do an acquisition, what's most important to him, and then also tell us what should be most important to him. So kind of what do you [00:19:30] present or what did you present?

Marcus Dillon: Yeah. Um, he's actually really good. So the what's most important to him is not the past. And that's what the controller presents right? So the controller presents what's happened in the past. They present the previous month. He's most concerned about the next 90 days, which is where I need him to be and where I need to speak into as his, you know, CFO. Um, so we look at the past and we say, okay, what is this telling us this last 30 days? But what is [00:20:00] the next 30, 45, 90 days look like? Because it's critical, especially whenever we're having issues around maybe some cash flow or holding cash ready to go do acquisition and needing working capital in this new service line with team members that are all of a sudden going to be added to payroll, and how are we going to fund that? So all of that is what we are talking through. That's what his focus is as well. And he was actually the primary sales person business development before acquiring [00:20:30] the business for this business. And so most owners are also involved in sales in some type in all businesses. And I would say in this situation a little more so because that was his role before acquiring the business and being the sole business owner. So for me, it's also holding him accountable to their pipeline and him sharing and updating where their pipeline is. What's the likelihood of this sale. So he comes to that meeting with items [00:21:00] as well. So he's put together his pipeline. 2550 75% likelihood or 100% if they've signed. And so all of that goes into the conversations that we can both have on a financial basis. And the other thing I'll say on this one is he actually has his operations person join the team as well, because that ops person, we're talking through different levers we can pull. And so I think the [00:21:30] ops person is an additional accountability. It's also an additional person we can delegate to if need be, to make sure that we're all staying on track.

Rachel Dillon: Yeah. And so some of that feels like might be in most accounting firm owners wheelhouse. But how did you how do you feel confident in presenting that information. Or is there anything that you use that helps you to feel more confident in talking to him specifically about his priorities at the moment? [00:22:00]

Marcus Dillon: Yeah. So what I'll do, um, they use Google, which isn't always ideal for like old school accounting, right? You know, we're an office 365 shop, so, uh, we use Excel and all that fun stuff. They use Google Sheets. And so we've kind of had to find that balance. So he'll keep, like, his internal stuff and then invite us into his Google Sheets for the projections. Um, when I'm, when I meet with him, obviously it's virtual. I have my camera on. My whole screen is dedicated to him. [00:22:30] So I've got a Chrome browser pulled up just for him. I've got three tabs open from his QuickBooks online file, so I've got his trailing 12 months. I probably even do 18 months. I'll go back in this last one. I went back to one one, 20, 23, his balance sheet all the way through the day. We're meeting because cash is up to date. We're posting that. We're making sure that his cash balance. So I may have this last month, um, 17 months [00:23:00] of different data. And so I've got that trailing 12 months or potentially a little bit more by month balance sheet. So I can look at things pretty quick. My next tab is that same period, but a PNL. And then that next tab is a PNL by quarter and comparative. So I can look at that and, you know, go from tab to tab to tab. Um, the next tab is my are aging because usually that's a talking point where it's like, [00:23:30] you know, we got to get this cash in. Like, I don't care whose account it is. Like, y'all need to go pick up a check, run a credit card, whatever it is, because that is the lifeblood of this business and running payroll, and because they've got, you know, some different things that they're working through are is is priority.

Marcus Dillon: So we're looking at are making sure that anybody that's over 30 days, we've gotten hands on and making sure that they have a plan in place because with ah, as everybody that's listening knows, like once that customer's [00:24:00] bad business decisions or cash flow management starts to impact our business like not not DBAs but that client's business speaking collectively, then we've got problems. And so like that's the piece where ah is pulled up as well. And then we actually for him we use an additional tool. Um, it's a cash flow tool where it actually attaches to QuickBooks because he does want a little bit additional cash flow reporting. So cash flow tool comm [00:24:30] I think is that one. And we'll actually do a 90 day cash flow. And then we drop in his payroll cycle. So we know the projected payroll. We know who's out there. So we'll drop that in. We'll drop in AP. We'll drop in AR. We also assume no AR gets collected because I want the worst case scenario that's out there. And then, you know, based on that 60 to 90 day cash flow, depending on what we're looking at. Um, it motivates him to go sell more, to go collect [00:25:00] AR. And that's where I need his priority at. You know, I need him on the ball and not necessarily thinking everything's going to be okay.

Rachel Dillon: Yeah, absolutely. And I feel like in part of that, you started sharing a little bit of the next piece of the meeting as far as strategy, as far as what you're recommending for him to do, or recommendations that need to be done in order to, you know, provide a solution to whatever that priority if it was a problem or to continue [00:25:30] progressing forward to whatever goal the client might be working on And so in addition to go out and collect ah, and naming specifically, you know, these are the accounts that are going to make the most impact and giving him specific steps. What other strategies did you implement at this most recent meeting?

Marcus Dillon: Yeah. So, um, many of the firms here, you know, it's we don't want to bill after the fact and we don't want our clients to bill after the fact either. So getting his automations and [00:26:00] systems set up, and he does this for clients all day long, but it's like, you know, the cobbler's children and their shoes kind of analogy. Um, so it's like, hey, when you send that engagement letter on that prospect, send the ACH form, take a retainer, take a down down payment, something because we're starting expense mainly payroll before we ever get to that. You know, that goal line, if you will, depending on how many goal lines there are in a certain project. And [00:26:30] so part of that is, um asking for retainers and getting ACH up front. And I've trained him much like DBA has been trained. Like we don't celebrate the client win until we get a signed engagement letter with an ACH. Because, you know, I've had good and bad clients and the best clients pay you. So I think that's also goes to our, our clients now, you know, letting them see the cash flow come in with client wins. Um, so those those [00:27:00] things are important in any business. And you're taking what you learn in your own business. You know, us with DBA and essentially putting that in the minds of others. And while he is a relatively young business owner, this business has only been around for 2 or 3 years with his ownership. It is like, hey, how can I take all of this wisdom of running our business for over almost 14 years? Um, and get this into his brain, you know? And so that's part of it.

Rachel Dillon: Yeah, [00:27:30] absolutely. And so then coming out of that meeting, what were the action steps? So pretty heavily acquisition focused I would say. Acquisition and are focused during that meeting. What were the action steps both for the client and for you?

Marcus Dillon: Yeah. So on the client it's sales, right. So like hey like go follow up with sales. What can we do to get this in? I know you're saying they're 30 days out, but can we get a signature today and then just tee them up to draft on 30 days? Like, you [00:28:00] know, it's those conversations so that I, as a financial as the financial seat at the table that I have some security as well, like for him and I when I use us and we interchangeably because I'm a part of that team, you know. And so I think it's not keeping DBA secure. I don't you know, that's probably the last thing on my mind there because we do have good processes in place. We're always going to get paid and draft ACH at the first of the month, you know. So that's not my concern. I'm talking [00:28:30] as the client's representative, like, what are we going to go do? So for him, it's sales. For him, it's due diligence. Like, hey, as soon as the attorney or the other party needs something, you need to ping me immediately. So I have the right amount of time to get that to you. Or if you want me to go review something on the seller side or on the on the. Yeah, on the seller side, I can do that and get you back some feedback pretty quick. Um, so that's, that's the priority right now on his side. Um, sales, cash flow [00:29:00] and due diligence on my side.

Marcus Dillon: It is taking whatever has come out of that meeting. If I know that, hey, things are getting a little bit soft, we're going to put this team member on furlough or have a bigger discussion around. We're going to turn on this software in two months. We're going to have this expense. I build that into the budget, I build that in the projection. And so sometimes that's me doing it depending on how much it takes. But sometimes I push that all the way down to the CSM and say, okay, I've had the meeting [00:29:30] please go update the budget with actual, you know, if we're keeping that in because we keep that in Google for them because they're Google Shop. Um, it's it's dropped into Qbo as well. But um, they just they go to Google, you know, so we, we do that. And that's something that Hannah updates at the end of the, at the end of the call. She's not on that call. But um, I ask her to do it. And usually that is my priority. You know, I'm waiting for emails on the due diligence side right now. [00:30:00] I'm waiting for emails or a call to say, hey, can you talk real quick? And he's good about that. It may be a 5 or 10 minute call, but, um, it gives some assurance to go do what he needs to do for the next 30 days until we talk again.

Rachel Dillon: Yeah, absolutely. And I love that our team is able to help in that, um, that it really is a team approach, even if it is you having the advisory meeting, you could not have that advisory meeting without all [00:30:30] of that data. Timely and correct, where you're confident that what you're speaking into is an actual reflection of that business, and then immediately following that meeting, if it's you, you're doing it. If it's a team member, they're doing it. But making sure that it's up to date because that month goes by quick. And so that next meeting with that monthly client, and then especially if they're in a season where they are looking at an acquisition and there may be something requested [00:31:00] in between that it's ready. And it's not like, oh yeah, I was supposed to do this after this meeting. So I think that's just really important. And you do a great job of that, of, you know, that if you don't have time or if someone else can do it to just let them do it that way, you're ready and available and all of the data is ready and available for whatever the next interaction might be.

Marcus Dillon: Yeah. So, um, also to give a little bit of bit perspective on this client. He is a monthly [00:31:30] client, so he's elite. That means just our package. Um, he pays us $3,500 a month. Currently, we do not do his payroll. He does not have sales tax. Uh, we he also has an in-house bookkeeper who helps with the invoicing. We do not do his invoicing, so that's important to know. So in this situation, that $3,500 is actually split pretty evenly between CSM controller and monthly CFO touch points. Um, I will say that I get a little bit more of the budget on this one [00:32:00] than, than normal. Um, because we don't do payroll. Um, he's on a PTO, and, um, they do have an in-house bookkeeper who really? She's doing a lot of the sales stuff, you know, invoicing. So, um, that's kind of how this team is made up. We do the business return. We do not do his personal return, which is kind of weird. So, um, his financial advisor, who he's got a much larger relationship with than most actually takes point on his [00:32:30] tax return, which is kind of not the norm.

Rachel Dillon: Yeah, that's great context. So let's move on to another client CFO advisory meeting that you just recently had. And let's actually move on to a dental client. So that is mostly who we market to is dentists, doctors and vets. We do obviously as we just told a whole, you know, half of a podcast episode on we serve other professional services as [00:33:00] well. So on a previous episode that we recorded about marketing, you can go back and listen that even though you may serve different types of clients, you want to direct your marketing and who you're talking to as far as online, um, to kind of one specific area. So let's talk through, uh, this is a quarterly client, dental client So quarterly only meaning quarterly in the client CFO [00:33:30] advisory meeting. Their services still happen monthly and even more frequent because I believe we do their payroll.

Marcus Dillon: Yeah. So I'll I'll start with the context on this one. And then we'll go into each of the parts. So this client great client. Um, somebody that I would go on vacation with, he also has great vacations. So, um, I would.

Rachel Dillon: Go on vacation with their family too. Yeah.

Marcus Dillon: Has a, has a couple of daughters. Their their stage of life is probably ten years, uh, ahead [00:34:00] of ours. So, you know, we get to share in life with them a little bit, you know, see what's coming down the pike for us. Uh, one of their daughters just got married. The other is wrapping up college. So all all good stuff. Um, but he is a dentist. We charge him about $2,300 a month. It is a quarterly touchpoint. So a premier client, uh, we do payroll. They also have, like, the ADP time clock turned on. So that's in that Hundred dollars. We do his business return and his personal return. We don't do. [00:34:30] We don't do the real estate accounting, which we've tried to get that over for years, but he has a partner in it and the other partner, CPA, does it even though we catch mistakes, which is fun. So um, but yeah, so $2,300 price point on this one. I have a little less budget. And this is somebody he's local to us. Um, he has my cell phone, he texts me, and we we generally have a good conversation. He's into Porsche and all that stuff. So there's a there's a few other things that we connect on. Um, but he's just a good guy. [00:35:00] We'll usually go to lunch probably twice or three times a year just to catch up. We talk about the business, but, you know, it's just life.

Rachel Dillon: Yeah. Okay. So I think you started alluding to it, but what does the connection time look like with this client on the quarterly call?

Marcus Dillon: We I have to cut it off. So I think that's the thing like, uh, on this, if your connection time is probably going more than 10 or 15 minutes, You need to like you don't have all day, you know, especially on this one. Um, he was like, [00:35:30] as soon as Elena, who's his client controller, sent out the financials with commentary, he's like, yes, I would really like to talk to you. In response to my email. He's like, let me know when you can chat. And I didn't know if he wanted to go to lunch or something. But given timing and travel and stuff, I just sent him my calendar. He booked a time, but he's like, hey, can you meet at 8 a.m. on a Tuesday? And I'm like, oh my gosh, like for you, I will. But you know, let's not say that too loud. Um, so we had a we had a call one Tuesday at 8:00. [00:36:00] He jumped on before his, uh, patients started coming in and I jumped on. And so, um, but yeah, I kind of knew where he was probably going to be coming from because I also talked to Elena and Amada, his CSM as well. And just like, okay, how's he doing? Like he's reached out. I know that he's probably got something on his mind. What's going on? So I knew that he was going to be feeling a little bit cash poor. And so I started looking at the financials. I started preparing for the conversation before that Tuesday meeting because [00:36:30] I kind of knew why. Um, just knowing him and knowing what's going on personally. But, you know, I just had to have all my ammo ready to answer his questions.

Rachel Dillon: So connection time with him, because I do overhear some of these or we talk about it because it has it does feel like a bit of a friendship as well. Um, as far as updates on what's going on with their family. So typically it's either or all Porsche travel and daughter's houses. [00:37:00]

Marcus Dillon: Yeah. Real estate. Yeah.

Rachel Dillon: Our whole lot. Everything the same of our life. Whatever's happening in he.

Marcus Dillon: He he works out. Yeah. It's, uh. Yeah, he's he's kind of got, got some things that are very similar to us. So we could talk about one subject for as long as we want it to. So.

Rachel Dillon: Perfect. Okay. So then after you having in your mind what you thought might be his priorities? What were his actual priorities that he presented that early in the morning?

Marcus Dillon: Oh, just exactly [00:37:30] what I thought. You know, it's like, what's keeping you up at night? You know, you can always you can always lead with that question if you need a transition or, hey, why are we talking like, what's on your mind? However you want to kick that off, I would say, even though I came to that meeting with assumptions of what he wanted to talk about, I don't need to talk first, you know, because maybe there's something else on his mind. Maybe he got an offer from a DSO like. And he wanted to spend the whole time talking about that and not cash flow. And I kind of came into that meeting, um, thinking we were going to talk about cash flow, you know, and it's like, [00:38:00] no. And so, yeah, it's what's on your mind or hey, what's going on? Like how you feel. That's kind of how you can start. So, um, but yeah, that's that's what we did. And he just reinforced exactly what I thought he was going to say. It's like, man, I just where's the cash? I don't feel it like and, and so very similar to him. We didn't. I never shared screen with him like I did on the previous client. Like, I'll actually share screen and they'll follow me. And what I'm looking at on this one, I just had [00:38:30] it all up. So very similar balance sheet, profit and loss. I even had his like, uh, mid-year tax projection pulled up because we also just made a tax payment in June.

Marcus Dillon: So I knew that he was kind of hurting a little bit from all those different things. Probably going to question like, if I don't see the cash, do I need to send the taxes in? I'm like that. All that, that always doesn't go hand in hand. But I was ready for that question too. Um, so it was just reinforcing that I knew where he was coming from. So a little bit of empathy, which you have [00:39:00] to learn. So as you get older in life, you're hopefully your EQ starts to increase even though you can't increase your IQ. Um, so I think I've done a good job about that. On empathy for him. And, um, so we just look back and I said, hey, this time last year, we had just received an ERC in the previous quarter So you had about $70,000 that was sitting in that account. You also had a very large. So they have a beach house and he has a beach house. And he had [00:39:30] a very large remodel project that he's mainly pulled out of the business. So about 200, $250,000 for this project. I'm like, dude, like, how's the beach house? Like, are y'all enjoying it? It's like, yeah, it's all done. It's great. And I'm like, all right. Like there's, you know, it's like.

Marcus Dillon: And just having that, having that data ready to like say, okay, this time last year you've pulled out exactly $200,000, 250in distributions. Did all that go to that remodel project? Yeah. Pretty much. And I'm like, okay. Like so that's where [00:40:00] we're at. We have less cash in the account just because like Pptp and IRC, as much as we love those days, they're done. So, you know, it's a lot of businesses that are in that situation where it's like coming back down to earth from all this, you know, funds that were coming in from different sources. And you know, so I looked at that, I looked at distributions, also looked at the P and L to kind of look at and see, okay, I, I know that the industry [00:40:30] like collections are a little bit soft. People aren't doing some of the, um, discretionary spending and or the selective, you know, procedures, elective procedures. Um, so where are we at on that? And he said, you know, production is actually about the same. And I said, well, from a collection standpoint, which is what we look at, collection, you're only down, you know, $5,000 compared to last year, year to date. And he's like, oh, really? And I'm like, yeah. So he's like, well, we're not doing as bad as I thought. And I'm like, yeah, you're [00:41:00] just spending a lot of the money, you know, so that that was part of it.

Marcus Dillon: Um, and then the one thing that did come out of it, that was his action item to follow up on, I was like, when's the last time you went through price increases? And so it's like, well, we just did that six months ago. And it's like, well, we need to do it again. Like we just need to make sure And then he actually looked at his dental software, his reports, and he was like, man, our R is up to like 220,000. I'm like, that seems really high for a practice [00:41:30] like yours. You know, he's doing about 2.4 a year, 2.5. And I was like, you know, that seems high. And he's like it. I don't remember it ever being this high. And I'm like, so what are we going to do? And he's like, I'm going to bring in my office manager and she's going to put some extra hours in and I'm just going to pay her and she's going to start working the list, start making calls. And I'm like, okay, like so. So that's part of the follow up and the priority that he needed to go do. And then the other piece was, um, he's, you know, fee for service. He's not, [00:42:00] um, primary with some of these dental insurances that just aren't great for our clients. So he still accepts dental, but he's not, um, not primary, you know, he's not he's not the one who's, like, getting the primo deals.

Marcus Dillon: And if you have clients in that space like the dental insurance reimbursements continue to go down for these doctors, and the cost to the insurer continue to go up. So it's insurance companies are making out like bandits. Um, [00:42:30] we started to talk through like, hey, you need to go talk to this other dentist, which we both know, which is the client and a friend. I'm like, he does the membership program, and it's kind of like, you know, insurance for himself. And he puts families on this program, and then he charges them a fee for all year long for two cleanings, X-rays and a discount on any additional procedures. And it's like, yeah, I've just been putting that off, I don't know. And I'm like, well, maybe now's the time to go look at it again. So I think those are the pieces where [00:43:00] his priorities come out of that meeting were a little bit different, and I walked out of that meeting with no, no priorities, no action items, which is what I like. Um, other than, you know, just checking on him after making sure that he's continuing to follow up with things But that's that's how that one went. And, you know, the next week I pull up Facebook and he's got pictures from a Greece vacation. I'm like, when do you go to Greece? You know, it's like, so he's living a good life.

Rachel Dillon: He must have landed and scheduled a meeting with [00:43:30] you right after. I think that I wonder he was.

Marcus Dillon: That is what he did. Yeah, I think that is what he did. And he didn't tell me that. He just got back from Greece and he got back from Greece. I'd feel broke too, you know?

Rachel Dillon: So he's lamenting about the businesses doing bad, uh, and forgot to mention that he went on a trip. Yeah. And spent a bunch of money. Yeah, well, I feel like I have an action step out of this because that friend you were referring to that has the family plan. I feel like I owe them for Avery's annual [00:44:00] membership plan because she went to the dentist. Obviously, she drives now, so she takes herself to the dentist. I think I still owe them for that. So that's my action step coming out of this. Um, but you did hit and you just went straight through those But financial analysis you were looking at what specifically? Just as a quick recap.

Marcus Dillon: Yeah, yeah, I was looking at his PNL, his balance sheet trailing 12 months. You know, he kind of year over year just to give him security and like and and on [00:44:30] that one I actually you know these aren't static reports I haven't pulled up and I can kind of go back to previous dates because I knew like, hey, we're we were we had those PGP and ERC funds in our, you know, coffers so to speak. So yeah, it felt great. While we could pull a little bit more of the profit out and, you know, could go do some stuff like a remodel project, but unfortunately we we aren't there anymore. And so we kind of have to go back to the pre-COVID days of just being very responsible business owners. And. Yeah, so that's [00:45:00] that was his situation. Um, we do send him an expanded kind of quarterly performance report. He did not have questions about financials or QPR because he just didn't, you know And I think that's the thing for listeners is you can send them all the fpna analysis you want, all the financials you want, but do they really look at it? What do they value. And I think that's the piece with advisory is you kind of have to know every client a little bit differently. Because [00:45:30] if I would have gone into the 8:00 call just saying, like, hey, let's look at your quarterly performance report and, you know, just would have been a waste of time on his side. And he wouldn't have been left better off.

Rachel Dillon: Yeah. And it really went to what was his priority at the moment. What was relevant to him at the moment? And really one where is my cash going or what's happening? You know, I think that they immediately go to what's happening to my business, you know, like it's starting to decline [00:46:00] or it's starting to fail or it's not. You know, what I used to do isn't working anymore. Which potential? I mean, partially, that's a little bit true as far as from a collection standpoint. And so, um, just making sure that you give the client the chance to talk and figure out what's important to them, so that you don't waste time talking about things that aren't important to them that day that they, you know, might miss everything that you said, even though you spoke [00:46:30] a lot of wisdom during a meeting, just because that wasn't what was on their mind at the moment.

Marcus Dillon: Yeah, yeah. And I really like I like the quarterly touchpoints. I think that is that's my sweet spot. I don't know that that's Leslie's sweet spot, but that's mine because, you know, some time has passed since you've seen that person. Some stuff's happened in the business. We can kind of give some additional insight. It could be similar or different from what we shared the last time. If if we had more monthly or even biweekly [00:47:00] touchpoints, it would just probably get tired. Like I, I don't know that that's my desire as far as like my role to be that involved, because I just, I feel like, you know, it's just hard to give advice. So I do like the quarterly touchpoints the best.

Rachel Dillon: Yeah. And then as far as, as far as the action plan that you were able to present or really the strategy as far as on this [00:47:30] one, they kind of went hand in hand as far as him needing to do something with the advice that you gave, you were able to talk about what another dentist does and is successful with and not just one, but a couple others that we work with because we work with other dentists. So that's just one of the benefits of starting to market to and, um, attract the similar type of client. So whether that be in industry or potentially even just size [00:48:00] of the business, to be able to use those same strategies that have worked in other dental offices with the next time that that's a priority or a need In the next dental office client.

Marcus Dillon: Yeah. And the part there too is the same team serves that industry. So Amada and Elena or well, tune with the dental industry and our dental clients. So it's like, hey, what's what do you see that's off? I'll always ask the team before I go into a [00:48:30] meeting like, hey, I'm about to have a meeting with so and so. Is there anything you want me to pass on or reinforce? Like, do you need anything? Because, you know, I also want to, you know, help our team members out. And if they're asking for a process improvement or not getting something that they really need from a client, I need to go into that meeting, you know, on behalf of the team member, too, and advocating for what they need.

Rachel Dillon: Yeah, absolutely. Well, we I told you to prepare for three, right? That we would talk about three [00:49:00] clients, but I think the third we could we could do a whole entire episode. We could do a series on his business. He is a close friend now is one of our longest client advisory, client accounting and advisory clients. And so I think we hold off and wait. Obviously at some point we just have to bring him on to one of the episodes and let him talk about why he's stuck with us this long, what what he enjoys, or what value he gets from he's [00:49:30] with us.

Marcus Dillon: He's stuck with us this long because we have allowed him to outsource every part of his life and only enjoy what he enjoys. So, um, that's why it's hard to track him down on a monthly time, because he's out there living life, you know, and I think, um, he is a sweet spot for us to because he's owned a business. And then he sold it, and then he is now on his second business, which he learned so much from the first one. So he knows what [00:50:00] he wants and he knows what he doesn't. Um, we also are very open about his succession plan and the things that we do in his business and setting that up for whenever he's ready to exit this one, and who the buyer will be and what the team internally needs to be. And so I think that one is a case study in its in its own. Um, he is a very, very successful professional service business, but he isn't what you would consider like most would, wouldn't bat an eye at it. And I think [00:50:30] that's the thing where, um, he, he does $12 million a year doing pest control and, um, puts a lot into his pocket. And he has a team around him, and he works probably ten hours a week. Um, very structured, very systematized, um, just great from a lot of different things. And so, yeah, he's he's killing it. And he thanks us for being at the right place at the right time to allow him to, you know, grow from 2 [00:51:00] to 12 is where we were on that ride with him. Um, essentially. So.

Rachel Dillon: Yeah. Well, let's change your brain just for a second, because obviously the one who's been with us almost the longest out of any of our client accounting and advisory clients, and then we talked through what two meetings look like for two established clients. And so what would it look like? How would that meeting run differently? Let's say if it was the first advisory meeting that a new client [00:51:30] who, you know, has been working with our team, maybe just that first four weeks of implementation and then it's time for the advisory meeting. How would that look different than the two that we talked through?

Marcus Dillon: Yeah, I would come to those meetings like well prepared, you know, like I wouldn't take anything for granted. I would, um, be following that agenda pretty closely. I would have all my deliverables lined up ready to share screen, you know, just be on my A-game. Um, it takes about a year, probably a year and a half, to really get comfortable with a client, like on [00:52:00] a quarterly basis. So I would say 4 to 6 meetings in, um, you, you get to know the other person on the other side of the screen what their, you know, point of concerns really are. Because I will say doing this for years now, um, the conversations don't change that much from client to client. You know, it's usually the same fears, celebrations, you know, concerns every, every call. And so it's just reiterating, like where you were at where [00:52:30] we're at today, like their concern how how we're working through that, you know, or how they're improving. So the people don't change too much. The numbers may change. But I think that's the piece where, um, you know, supporting them. It takes a little bit of time. So new clients definitely following it to the tee. Um, just because until you have really that relationship, which it's hard to establish with the prospect and then the new client, um, you really have to deliver. [00:53:00]

Marcus Dillon: And we never want anyone to say like, hey, this was just a miss or anything on our side. You Overpromised and under-delivered. So, like, whatever we have engaged them for is what we're going to prepare for. And I know that may sound like you don't do that for all your existing clients. We do. But, you know, like the fpna stuff, especially like on the quarterly dental client that we just mentioned, he doesn't care. Like he knows his business better than anybody. He wants, [00:53:30] you know, his his definition of advisory is really what is our advice to him. Like he knows his results. And yeah like the fact that he's like in our model and we have these very nice PDFs of financial statements and additional fpna analysis like that helps me, but that doesn't really help him. So I think that's the piece where if he's going to share that once a year to a valuation expert whenever he gets a DSO offer, maybe it's nice to have, [00:54:00] but he's not looking at it monthly or quarterly just because he's got a direct connection to me to really ask his best questions.

Rachel Dillon: Yeah, absolutely. And I know during those first few advisory meetings is really spending time and listening, getting the client to talk through, being able to form those connections. So listening to what's important to them, what's important about them, um, really finding out what those priorities [00:54:30] are for them so that you then can start to anticipate for future meetings what they might be concerned about, what was important to them last time, especially if you, you know, have to get back to them after the meeting. That's something that you didn't anticipate was important to them. That way, you know that you have that prepared for the next whether they want to talk about it or not. It's just ready. And then as well as sometimes there's education that goes into that. Sometimes when it's their first advisory meeting, it's literally their first [00:55:00] advisory meeting. They've never had a CPA or another financial Professional, sit down and give them the time for them to kind of lead the conversation. So being able to, when they ask the questions, point to the financials or any data that we might have that supports the answer so that they can potentially start looking at their data on their own before the meeting and then asking even better questions. So definitely the connection and the priority piece are very important during those [00:55:30] first ones. And then allowing that financial analysis to just be education as well, so that they get to know what we're providing to them and how to use it on the in between, and then can bring the really tough questions, right, whenever it's time for their advisory meetings.

Marcus Dillon: Yeah, it's just reinforcement a lot of times to your point. You know, it's like, hey, this is what we're seeing. And then it's like, oh, like here it is in black and white. And that is what they said. So um, but yeah, it's not it's not leading with that. A lot of times [00:56:00] I would say on those earlier relationships, it is a lot of trust building, you know, and making sure that they are going to be a good fit long term and that we continue to uphold our end of the relationship.

Rachel Dillon: Yeah. Well, this has been a great conversation. I appreciate you being open to share exactly what it looks like. Hopefully this will help somebody listening, whether they have been, you know, hesitating on offering advisory meetings or leading them and wondering, [00:56:30] you know, what is everyone else doing during these meetings? This is just kind of an example of what they look like at DBA.

Marcus Dillon: Yeah. Well, thanks for leading it.

Rachel Dillon: Thanks for hanging with us to the end of another episode. Leave us a review with your thoughts, comments, and feedback on Apple Podcasts or Spotify. Be sure to subscribe to our podcast so you don't miss any future episodes. Join us again next week for another great conversation.