In this podcast, Tom O'Neill, entrepreneur and financier, talks about two significantly important topics:

  • Methods to uncover hidden values in a business; and
  • Specific tools that owners can used to create freedom by removing themselves from active operations of their businesses.

About the Guest

Tom O'Neill is the managing director of Libertas Capital Holdings, a privately-owned investment company focused on companies with positive cash flow in the lower middle market. Tom is also on the Board of Exodus Capital Advisors, a business advisory firm that helps lower middle market business owners increase profitability by using proprietary private equity capabilities and techniques.

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Read the Full Transcript Here:

Noah Rosenfarb: Hello everyone. Welcome again. It’s Noah Rosenfarb from Freedom Business Advisors, the author of Exit: Healthy, Wealthy and Wise. Today, I’ve got a great guest, longtime friend, Tom O’Neill. Tom’s an investor and entrepreneur who’s got a great background. What I was hoping he could share with us today is how he’s built freedom into his life, so that although he owns a portfolio of companies, he’s able to live where he wants and have his time under his control. Tom, thanks so much for joining us.

Tom O’Neill: My pleasure. Great to be here with you, Noah.

Noah Rosenfarb: Why don’t we get started with, maybe share a little bit of your background and how did you become an investor in businesses and what’s been your experience to date?

Tom O'Neill: Sure. I’m not sure exactly where, to be honest with you, but I acquired the bug for entrepreneurship so to speak, really when I was a little kid. I used to run an imaginary business out of my closet when I was three and a half, or so I’m told. Just as I was starting landscaping business - my first business, real business that I actually transacted with customers was a landscaping business when I was a kid, kind of the handyman/landscaping business. I just got a taste pretty early in life for the value creation process. I’m kind of enamored by it. I think part of it’s the idea that you can convert ideas into value if executed well, and just solving problems that people care about. If you can articulate it to them in a way that they can understand that value, you could really create wealth, just from your mind. It’s like the modern version of alchemy in a way.

I’m just enamored by the process and I love the, as you mentioned, the freedom. I think I got the idea pretty early that I wanted to live as free a life as possible. For me, that’s being able to travel often and not sort of be geographically tethered to businesses that I begin. That’s kind of - freedom’s been a huge driving force in my entrepreneurial journey. I got the bug as a kid, studied at Georgetown undergrad in business and really started mixing it up as an entrepreneur pretty early. I was about 22.

Noah Rosenfarb: So the first - let’s call it real business that you were involved in - did you start it or acquire it?

Tom O'Neill: I studied entrepreneurship at Georgetown. I was very fortunate I studied under a guy, Walter Benson, who was one of the inventors of the mini bar. There were a few different companies I think they contributed to the IP in that space, but Walter had invented - he had a company called Servibar, which had done really well. He got really respected because he wasn’t just reading out of the textbook. He’d started a pretty substantial business. His idea was, "Hey, you’re going to make mistakes as an entrepreneur so resist the temptation to start something right after school. Go work for somebody else, make some mistakes on their nickel." That’s how Walter put it. Just learn and then opportunities will naturally arise.

I worked for Ford Motors for a couple of years, and then my first business was really an ideal first business. I didn’t have to buy it. It was in the medical field, at least at that time, going back to 1997. A lot of the sales of capital equipment in the medical technology sector were done by independent sales organizations and I stumbled on the opportunity to become one of those where I could sell other people’s products but really have my own company. I thought it was a great way to start. I didn’t have to buy anything. I didn’t have to really take principal risks. I just had to deliver sales and marketing value to these companies and what it came down to was I convinced one of those companies to do business with a 22-year old. That was the hard part. I was able to build the business around that. I picked one product line essentially was adding another product line and eventually built a solution. I was able to successfully divest in the business a few years later.

It was a great half step that's how I looked at it. I got to be my own boss - choose my own hours, choose my own strategies. I just had to sell but I didn’t have to take inventory risks. I didn’t have to manufacture anything. A lot of the marketing was done by the manufacturers. My first business was really as an independent manufacturer’s rep for a half dozen technology companies, focused on the gastroenterology sector. It was a fantastic way to begin, looking back, because of this. I learned a lot of the important lessons without having to honestly pay the normal price for it because I was able to step into a situation where I just had less risk.

Noah Rosenfarb: What were a couple of the things that you learned along the way in the years that you were operating it, and then as you decided to divest yourself of that position what was going on in your mind that motivated you to want to exit and what were some of the lessons learned there as well?

Tom O'Neill: There were a couple of things driving my motivation exit. I was living in Silicon Valley at that time since I started the business in 1997. By 1999, it was very clear to me that something very significant was happening in the technology sector and I felt like I was missing out on it, to be honest with you. That was part of it, I was watching these very large companies, and really interesting companies, more importantly, that were created literally around me and I felt like I’m capable of doing that but I felt like I was over here on this other sector just cut off from high technology. I’m a technologist, really a geek at heart. I was a little bored with the business so I figured out. It lost a little of its luster for me.

I was dealing with - I was really having a good time running the business where it came down to the customers. I had great customers. I’ve still maintained friendships with some of them to this day. But it was a stressful environment. You’re always wearing a beeper, so to speak, back in the day. Dealing with life and death in some cases. You just always had to be on and ready to support the customer. That part of it was difficult.

A little bit of boredom, a little bit of burnout on the business led me to start looking at other things. That was really driving my divestiture process at that point. I also had an idea for a software company that was incredibly passionate about and it was like, "This is where I need to spend my time for the next few years."

Noah Rosenfarb: What did you learn in that first exit that you have carried with you through your experience until today?

Tom O'Neill: A friend of mine put it this way. He sold his company for $25 million. He’s traveling the world now with his wife. He recently wrote an article on his blog and the headline was "Hell Yeah or No." It said from now on, basically, when he comes to a fork in the road, it’s either, "Hell, yeah," or, "No." If he’s not incredibly enthusiastic, if it isn’t personally fulfilling on every level, if he’s not stringing out and say 'yes’ then he’s not going to do it. He articulated that much better than I did at the time. That feeling was kind of going on inside me at the time. I’ve just lost the 'Hell yeah’ for that business and I acquired 'Hell yeah’ for another business. That was one of the big life lessons that I think I began to learn and probably honestly I’m still learning.

I think it’s more of a process than a destination. It’s paying attention to what motivates me, which is what I’m excited about, what I enjoy. I tend to thrive at because I gladly spend more time on those aspects of business. Things that I don’t enjoy doing I tend to avoid. Those skills don’t develop as quickly. The most important lesson I learned from that probably was more of philosophical. When I really focus on what I enjoy and what feels more effortless to me, that’s evidence of my personal outstanding skill sight. We all do things, I think - a few things - maybe better than a lot of other people. We all do a bunch of things about as well as other people and we all do a bunch of things, a whole other set of skills that we do not as well as other people. I’ve started to begin to pay attention to that around that time. Maybe the more I focus on my real sweet spot of skills - the ones I enjoy the most, the ones I’m best at - I think the better I’ll tend to do and I began to learn that because I realized I was doing a bunch of things that I really wasn’t that excited about and I needed to change that just for my own personal satisfaction.

Noah Rosenfarb: When you’re looking at acquisitions to add to your portfolio, do you feel a sense of there has to be passion in the product or service of the company required, or is the passion about the acquisition and the changes you can make to the business to add value?

Tom O'Neill: That’s a great question. I don’t know the answer to that exactly because I’m just giving you an honest answer. This is very much a process. I’m still in the middle of - I’ve been refining for years and years and years - but I think a little of both. I’ve always gotten excited about the idea of money on the table. When I see - as an old partner use to put it - just leaving the money on the table there’s a certain kind of value. One way to look at sort of hidden value in business is the term I call latent enterprise value, which I define as value that could be liberated within a financial quarter with little to no effort. That exists in most every business and this comes in a lot of different forms, if we can talk about this, but it exists in almost every business.

Every business, it’s there in some quantity. Almost any business just looks at this. There are these tweaks and I became fascinated with the idea that there’s an opportunity in some businesses to make almost the equivalent of a chiropractic adjustment to the operation and get a very significant change in cash flow. That is a very exciting idea to me, that there are businesses out there where relatively experienced maybe three or four minor adjustments you can execute inside of a quarter for almost no money and increase EBITDA by 30%.

That exists. We all know at some level that it exists, but I think very little time is spent honing the skill set to identify and harvest that kind of value. The value creation process is what’s driving me to an extent but now also I’m trying to not just leave it there. I’m trying to have some kind of emotional connection to what the business does, because for a long time I would just get enamored by the fact that I knew there was opportunity to create value and I would just stop there. What I’m learning in my entrepreneurial journey that has not occurred to me for 18 years - I can’t believe it’s been that long - the further I go the higher my standards get. Now, I really want to feel like the business connects to my life purpose a little bit more. It doesn’t have to be in the middle of the strike zone every time but it’s just more of a consideration for me now what the business does that it would have been five years ago. I really wouldn’t have cared at all what the business did. I would just have been more focused on the fact that I could buy it for X and sell it for X plus question mark.

Noah Rosenfarb: Walk me through an example of two of some of the tweaks that you’ve made in a company that you had and the impact, and then if you can follow it on with what was the owner’s response to that if they were aware of what you had done.

Tom O'Neill: I’ll give you the specific - this is the first example that comes to mind - and then if it’s useful I can give some observations of some patterns which I think would be even more valuable to your listeners. I’ll give you specific examples but also to some extent I feel like there’s a model that your listeners can use that they can apply to their business, to look for these types of hidden values, if you think that would be interesting to them.

The first one that comes to mind was, this is about a $70 million top line and it made about $3.5 million with 5% EBITDA. The sales and EBITDA had been almost completely flat for three years and the business owner was approached by some people who wanted to buy this business. He wanted to at least entertain it, hired an investment bank, investment bank gave him a valuation based on comparables largely of about $30 million of exit value. He had to think, "Well, is that what you’re deal?" He later disclosed his thoughts process with me. He said, "I take a million and five a year out of this business. If I sell it for $30 million after the taxes and when I put this money into an account it’s going to earn 7% and I’m going to make $1.5 million a year."

What’s the impetus of the sell? Because he was operationally disconnected to this business so it's not like he was burned out. He had professional management. The owner is a very wealthy guy with about $600 million. He was a true chairman of his business. He showed up a couple of times a week for an hour basically to just check on things, but he had professional management in place, so he wasn’t burned out or anything like that. He was more of an owner than an owner operator, which is a great place to be but he did start to become excited about the idea of liberating some capital but he wasn’t going to sell his business for $30 million. He basically came back to the investment bank and said, "If you can sell it for $40 million, I’m interested." The investment bank came to one of my businesses called Exodus Capital Advisors, which works with entrepreneurs in that capacity.

My first job is just to give our professional opinion as to what are the values there. What we found was we thought we could enhance as a team EBITDA by at least a million dollars within the 12-month period based on some findings. In this case, we found what I call structural deficiency, which is basically a missing process. There’s a certain set of processes that I feel optimally every business should have, things like lead generation, customer acquisition, customer retention process, and customer reactivation - when you have a thousand customers and then at any given time some of them are deviating from baseline purchasing behavior. If the average customers orders once a quarter and you look at your customer list, I guarantee you some of the customers haven’t ordered in the last quarter. The question is, is there a process of identifying when that behavior’s changing and doing anything about it.

In this business, there wasn’t. Even thought it wasn't I think what I would measure a revival business, a very successful entrepreneur, but it basically had a leak in it because when a customer left, nobody noticed. It’s because they had 20,000 customers so it was easier for 500 of them to slink off into the distance without being noticed unless they were a huge customer. One of the things we identified was a huge number of - I think it was about 5,000 or 6,000 customers who had deviated from what's called baseline purchasing behavior, which I think the average customer ordered about 7.2 times per year, as I recall. So we agreed, "Okay, anybody who hasn’t ordered for a year should go into this team sharing bucket that we’ve set up to try to recapture them.

What we did was we just contacted them, asked them why they left. We got about 25% back and it was $800,000 EBITDA the first year. It’s just really simple stuff in some cases. It can be difficult to find. There’s a lot of database work and kind of heavy lifting and analysis that goes into that, but once you see it and what you do sometimes can be really obvious. It’s sort of like finding gold coins on the beach, you know - it can take a lot of time but once you do, you just pick them up.

Noah Rosenfarb: What was the owner’s reaction to that? Is it something that just was never in his sight or he never took the time to look down and see the gold that was buried a couple of inches under the ground?

Tom O'Neill: Yeah. First, I think honestly, his first reaction was anger at his management team. He was upset that it sort of blew his mind that there could be $800,000 of EBITDA, and mind you, this is kind of a recurring process. There’s a reasonable expectation that this is something they could keep doing. If they’re valued at nine times earning, basically what happens is I just showed them that in a few months of work, that there’s $7.2 million of shareholder value sitting there, waiting to be harvested by somebody. I think a reasonable and natural reaction was anger at the management team, but it really wasn’t their fault. I said to him, "Look, this is kind of a marketing question, isn’t it?" He agreed and I said, "How many marketing people do you have?" The answer was really zero. They didn’t have a VP in marketing and there was really no one charged with the process of finding this stuff and so, guess what, it was never found.

His first reaction was anger but he got over that and obviously it transmuted into excitement that he was that much closer to where he wanted to be from a valuation standpoint.

Noah Rosenfarb: Let’s move on to a different topic around freedom, because I know that’s something that you’d done an expert job and it’s been a life’s task for you to acquire businesses that don’t require your presence on a regular basis to operate and continue to grow. How has that come about and maybe in contrast - when you’re 22 running a medical device company wearing the pager and being accessible all the time, what are some of the things you’ve done to maintain just both in the business and to your own daily routine to make sure that that could happen?

Tom O’Neill: Again, just to be honest to your listeners, it’s a process I’m still going through. All these things I find just things that you’re doing and you continue getting better at rather than something you just figure out and you just forever get it. I constantly find that I’m doing something in a suboptimal layer or if there’s some way to do things better but you mentioned buying businesses. Buying businesses is what you do because usually there’s management intact. For listeners who are in M&A or want to build up an alternative assets portfolio of their own, if it’s easier to do if you find a company with good management and buy it, leading that management in place, supporting them. That’s the easiest way to be passive.

Most of my time has been trying to extract myself from things that I’ve started where I had some kind of operational role and like, "How do I get out of this?" I’ve learned over time I really don’t like running companies. That’s me. I think some people really love it, and that’s what makes the world go round is that we can trade. Not everybody likes to do the same thing and thank God for that. Most of my time has been trying to get out of things that I’ve started and the lessons I learned so far, if I could distill them down - Peter Drucker said business is basically two things: innovation, having something of value to bring to the marketplace some kind of a solution, and marketing, articulating the value proposition to prospective customers and trying to induce them to avail themselves of that value.

Business is kind of accept sales and service. It might be sort of an overly simplistic way to think about it. Business is selling and then making promises and then keeping promises. If the entrepreneur ever wants to be free, they can’t be into promise making and keeping business themselves. Another metaphor would be throwing the ball and catching the ball. A business is basically an amalgamation of transactions, just a bunch of trades happening that create value for the customer and value for business. If the entrepreneur is actively involved in that trading process in some way, if they’re the number one salesman in the company essentially, if they bring in all the big deals, they’re stuck. They’re just too important to that business so they got to find a way to get out.

A lot of entrepreneurs end up being the fulfillment person. They’re the inventor, they’re always tweaking the manufacturing process, and I could think of dozens of friends and clients over the years that fit each of these profiles. Usually, the entrepreneur just gets stuck somewhere. They’re the man or the woman for that area. How to get out, it’s very difficult, more intellectually and emotionally than physically, but for me, I adopted the mindset of every time I found myself doing something repetitive I thought, "Okay, by definition anything repetitive is important for this business probably in some way." Every time I found myself doing something repetitive, I just adopted a philosophy, "This is the last time. I’m never going to do this." I would turn on a screen recording software, I would narrate what I was doing, and then that became the training program for whoever I delegated it to immediately after I finish that task.

I would identify somebody in my business or a contractor, a vendor, somebody. I just give it to him. I’d say, "Here’s a half hour video. From now on, you get these spreadsheets and this is how to process it." It’s like an easy hack for giving out a pass without having to build the whole operations manual every time. Just record what you’re doing. That way, whoever your delegate is, they’ve got this - there’s two pieces of magic there. One, you’re completing the task from beginning to end so there shouldn’t be a lot of questions if it was successfully completed on camera, complete with narration and explanation. There shouldn’t be a lot of questions maybe some but most is going to be headed off by the video. The best part is, it’s off your clock as an entrepreneur.

If there are any questions, first thing is go back and re-watch the video. That way, I’m paying for half an hour of my employee’s time instead of half hour to my time. Little by little, I started to experience a lot more freedom by doing that sort of thing, dig out operational roles that I would find myself in. Again, honestly, I still find myself in the operating roles all the time, and now I try to notice when it’s happening and then re-engage these processes and digging out one task at a time.

Noah Rosenfarb: If you have other people doing the work, which is great, obviously that’s creating value because somebody else can step into your shoes as an owner and hopefully not have a technical role to fill. When would you know if it’s the right time to sell a company that you own, when you’re not actively involved in the day to day operations? Your passion might not be a requisite for making money.

Tom O'Neill: That’s a great question. You’re saying if your passive on a business already, if you’ve already successfully extracted yourself, so for a business run passive now, when will I decide when to exit?

Noah Rosenfarb: Yeah, and what’s motivated you in the past to exit businesses where you might have had a more passive role rather than an active role? You didn’t need your time. It was a really a question of capital.

Tom O'Neill: I think in some ways that question points to its own answer, which is the question of capital. First thing is, know approximately what the likely exit value is. I know you’re an advocate for this as well. I think it’s getting regular appraisals on - any asset’s of substance. It’s a good idea to get them appraised regularly because part of the decision making process really is, "I’ve got X amount of dollars over here. Do I have a higher and better user as dollars? Square one is what would the dollar be? If we don’t know what a reasonable expectation of exit value is, it’s hard to make decisions. If there’s ten million locked up there, that may affect my decision making differently than if there’s five million locked up in that business, in terms of net worth.

It is a good idea to get them appraised regularly but for me it’s a question of capital. Do I have a higher and better use? What’s my effective rate of return? It starts with a valuation. Let’s say that we value the business and the third party valuation comes in at ten million. Now, my question is, "Well, what sort of return am I getting on that ten million dollars? What sort of passive income am I taking out of that business? What sort of equity appreciation am I experiencing with that business?" I look at it in the same level as a mutual fund manager looks at their portfolio of public equities, just how is this investment performing for me as an investment. If it’s under-performing alternatives that I think are better on a risk-adjusted basis, that’s where I begin looking for the exits, unless I believe that’s a short term problem that could be easily fixed, or unless I believe that there’s some sort of non-economic benefit that I’m getting, which is often the case, you know, the perks of owning businesses.

I have a friend who owns a pretty big private equity firm and they bought a chain of six very high-end steak houses. He said, "We’re never going to sell this business." This is too much fun and we really don’t care if we make money. We don’t want to lose money but it’s not the driving force. It’s just so fun to own because these are real hot spot in the cities that they’re in and it’s a great place for them to entertain, to bring entrepreneurs they want to woo or whatever. This isn’t an economic or sort of a less obvious economic benefit that comes from owning that so that just filters into their calculus. It doesn’t really matter for the IRR. Whenever it seems like it’s not worth it, it’s a great personal decision but for me whenever it seems like it’s not working, if it’s too much of a hassle to be involved with that business or the business is some kind of - businesses for me that are thought to be businesses with a regulatory landscape, this is really getting worse and worse and worse, the paper work, the liability - I start looking through the exits. In some cases, if you don’t have a billion-dollar balance sheet it could be difficult to be in an industry where there’s tons of regulations that are being imposed and all the existing players in that business usually by somebody up the food chain.

That could be one thing, so fun is a factor but really I try to be as passionate as possible and I look at it more the way Buffett would, like, "I’ve got X amount of dollars here. Between my dividend and my equity appreciation, do I have a better place for this capital?" If I have a much better place or much more fun place for that capital based on my personal plans, I’d start looking at it. The challenge as you know is it’s not like flipping a switch. It could take you a couple of years or more.

Noah Rosenfarb: Let’s talk about that because I think one of the things that I advocate and I know it’s part of your ethos, is that businesses should be sale-ready. They should be operated in a manner that if you do want to flip the switch and market a business for a sale or transfer, that there’s not going to be, the three years of work that you have to do to get it ready you’ve already done those three years of work. What are the things you recommend owners would do in almost every business case that you’ve seen to help get their company in a position where they have a better decision making tree when it comes to exit value, exit readiness, and the ability to transfer?

Tom O'Neill: You brought a great point that I haven’t thought of exactly in this way before but this is work that cannot be avoided. This work will be done. The work of transitioning you out of the business will be done at some point or another if you ever sell a business. For most entrepreneurs, they leave it to the last minute - most of us - and I’ve done this as many times, I’m guilty of this myself, I’m not pointing a finger - but a lot of times we leave it until the end and so we end up being on a three-year employment contract where essentially the new owner has to pick our brain for three years to figure out how to get us out of the business. If you do it in advance, it is a clear benefit. You can actually walk away when you sell because you’re really not important for the business.

I’ve been in both situations where I was incredibly important. I’ve been in situations where I can literally hand the keys and walk away and say, "Call me if you need me." The latter is much more fun. It’s really just a process. Going back to what I was saying earlier, it’s all about operational disconnection and it’s a step-by-step process. Some of us might have fifty things to do for the business to be operational. Some might have 500 and some might have five. For me, the acid test where a good destination is to be is if you didn’t walk into the office for the next ninety days and just disappeared, would you still have a business? Would it be growing? Would it be flat? Would it be in trouble? I think most entrepreneurs have a pretty good feel for where they are with that. That’s the beginning. Could I walk away for ninety days? If the answer is no, why not? Those are the places you need to begin to hand off those processes to somebody else or eliminate the processes, or replace new software or vendor or something. 'What you do' to disconnect is less important than 'that you do'. Does that make sense?

Noah Rosenfarb: Yeah. You’re a wealth of knowledge around automation and process improvement so maybe now that we’re at the tail end of our time together, you could share some of your favorites. You mentioned the screen casting as a way to build an operations manual. That’s something we do in our businesses and I found it’s been a really effective way to get your operations manual done and have it recorded and process improvement and work delegation, especially a lot of businesses I own. We outsource things to people that we never meet in person so the only way to communicate is via that video chat. What are some of the other best practices that you see in technology improvement?

Tom O'Neill: I think it’s the best time to be an entrepreneur in history because the tools available for building businesses but also automating them have never been more plentiful or cheaper. Screen casting is a great hack for the ops manual. Its starting point is easy. The employment marketplaces - Odesk, Elance - there’s literally dozens of others where you can pick up talented of people from all over the world. You can micro-delegate. You give them one task that takes them half hour a week and they’re happy with it. You can find good people to do that.

I came up with an acronym more for myself and for others when I deal with clients. It’s called S.A.V.E. (Systematize, Automate, Vendorize, Eliminate). It means save yourself. The first step is actually the 'E’, which is eliminate. If I find myself doing something every week, I do a little bit of X - I should try to choose a different variable. Every week I do a little bit of Y and the first question I ask myself is, "Is this important? Does this need to happen?" Probably, 10% or 20% of the time I look and why am I even do this? Is it something I need to be doing for the business? In some cases, I think we have to face the fact that we’re doing things that aren’t particularly important so there are some things to be eliminated and obviously it’s a great thing when you can find it. If I can’t eliminate it, I want to automate it. That’s the A in SAVE.

There are tremendous number and a growing number of software tools that can essentially replace humans, and that is my preference. Any time I have a task, if I can give it to a computer, that’s my preference. The computer works 24/7. It doesn’t complain. Generally, it doesn’t forget, if the technology’s working properly. It executes a task exactly the same way every time so there’s tremendous amount of quality. Now, they can automate it - the joint marketing, like the tools like Infusionsoft, Salesforce. There are add-ons to those platforms that will literally do a lot of the work of a marketing manager for you. Once they’re programmed, they literally do the work. We could spend five podcasts just on that subject, on what are some of the best tools out there. It’s only how deep you want to go down that rabbit hole but it’s a fairly deep rabbit hole, but there are a number of tools.

If you’re basically typing your tasks into Google and then put automation after it, you’re probably going to get some companies and vendors and service providers who do that sort of thing. So if I can’t eliminate it, I try to automate it with some tools. If I can’t automate it then I’ll try to vendorize it with a V. It’s just my bias that if I can hire a vendor over employee, that’s my preference, so if I can’t automate it I want to vendorize it because if I hire a vendor to do a particular function I just get more accountabilities is my experience. If I hire them to do a certain task and they don’t do it, there’s no expectation that they’ll be paid until the deliverable is delivered. With an employee, you can have them in payroll for six months before you figure out they can’t deliver for you. You pay for that plus federal taxes on top of it. I find it riskier proposition to hire people than hire vendors. So for anything that non-essential, that’s absolutely not mission critical I try to put it outside either to a contractor or a company.

The S, If I must give it to a person, which is the last resort, I try to systematize at least. I’ll go over a checklist and just essentially try to introduce as much of that quality control as possible so that employees can literally paint my number versus having to be talented artists. It’s harder to find artists than it is to find people who could follow instructions. I try to give them enough instructions.

Noah Rosenfarb: That’s brilliant. I love it. I’m going to adopt it and give you credit where credit’s due. Thank you for that. What else would you like to share with our listeners before we wrap?

Tom O'Neill: We could go on and on but I’d like to suggest to your listeners that if they don’t find themselves on this journey already where they’re trying to operationally graduate to owner - and again this is something I’m always doing. It’s not like something that I just completely figured out and never have to deal with again. I find I’m constantly pulled back in the businesses.

I’d like to suggest that it’s a very worthwhile pursuit. It’s given me the ability to - as we have this conversation I'm a thousand miles from my nearest business and I haven’t really been there for a couple of years - and it is possible to do. I’d like to suggest that it’s a very worthwhile endeavor. It’s challenging at times but for those of your listeners who are entrepreneurs, who are in this situation, there is light at the end of the tunnel in terms of - only you’re completely operationally disconnecting from the business, which can be harder, or at least even the things that you really enjoy the most. That alone could be a huge lifestyle benefit. I would recommend pursuing this course of endeavor as an entrepreneur. The dividend you’ll get is you’ll business will be - the less important an entrepreneur is to your business, the more valuable that business tends to be, because a prospective buyer doesn’t have to worry what happens if Tom gets hit by a bus. If it sounds irrelevant to the business, then it's just easier to sell.

I wish there will be a lot to that process and if people - feel free to give my contact information out, people have questions or wants additional input, your listeners are free to contact me.

Noah Rosenfarb: Where should people get a hold of you? LinkedIn, email, phone? What’s the best?

Tom O'Neill: I’m on LinkedIn, Tom O'Neill. My older company is called Libertas Capital. That's our domicile for private equity investments. People can email me at

Noah Rosenfarb: Great. Tom, thanks so much for joining us today. To all our listeners, we appreciate you tuning in. Don’t forget to rate us on iTunes, share this podcast with a friend and email me at if you have any suggested guests for the show or questions. We look forward to hearing from you. Please join us again.