KTA Financial Services: 

Jeff Walter (00:05)

Hi, I’m Jeff Walter and welcome back to the Training Impact podcast where external learning meets strategic impact. My guest today is Emily George. Emily is the Director of Strategic Partnerships at KTA Financial Services. Prior to KTA, she was the Director of Membership at the International Franchise Association.

 

and a senior client coordinator at the Franchise Business Review. So Emily knows a little bit about the franchise industry, just a tad. So Emily, thank you for your time and welcome to the program.

 

Emily George of KTA Financial Services(00:35)

Yeah, thanks so much for having me. It’s fun to be here.

 

Jeff Walter (00:38)

Yeah. So Emily, I always think of us as accidental tourists. We ended up someplace ⁓ unknown in our careers. I, for one, the listeners are probably sick of hearing this, but never thought I would end up in Michigan. Started off in New York, headed south, thought I’d never see snow again, except when I was skiing. And here I am in the winter wonderland. And I love it. I’ve been here 25 years. And so totally accidental tourists here.

 

Emily George of KTA Financial Services(00:50)

Sure.

 

Yeah.

 

Jeff Walter (01:03)

How’d you end up at KTA? And just tell us a little bit about that journey and how you got where you’re at and how much fun you’re having and what KTA does.

 

Emily George of KTA Financial Services(01:10)

Yeah, think,

 

sure. I think like so many people, kind of fell backward into franchising. So I actually went to college to be a high school history teacher, did my student teaching, spent a year in the West Des Moines School District, had a wonderful time doing it. And then my now husband and I relocated from Iowa to Ohio and I decided to not pursue a continued career in education. And you know, like,

 

My mom’s famous last words after growing up in a restaurant family were, do anything you want, just don’t go into restaurants. I went immediately into restaurants and I had a wonderful 15 year career in hospitality. I was a professional bartender. I was a competitive bartender. I got to travel the United States doing really fun, very cool things. And one of my regulars at the last restaurant I worked for,

 

was at the time the president of Wendy’s International. And a few years after I had officially left hospitality, I had exited a tech company and was looking for the next thing to do. And I called Daryl and he had just bought a small restaurant group that he wanted to operationalize and prepare for sale into the franchise space.

 

Jeff Walter (02:12)

wow.

 

Mm-hmm.

 

Emily George of KTA Financial Services(02:33)

So I went to work for Daryl and his business partner and they knew nothing but franchises. They operated everything like a franchise. They spoke franchise language. They were so steeped in franchising and I learned so much about the business model and the industry from those two folks that it then kind of propelled my entry into franchising as a long-term career.

 

Jeff Walter (02:39)

Okay.

 

Emily George of KTA Financial Services(02:59)

It ultimately took me to Rev Local and then Franchise Business Review, the IFA, and now KTA Financial, which has really been the perfect marriage of everything I’ve learned in franchising to date and now a very equally franchisor and franchisee facing opportunity to help make a really significant impact for individuals and systems who just

 

need financial clarity. So it has been a very backwards route into franchising, but a wonderful pathway. And I’m so excited to be with Jonathan and Gil and the team at KTA Now.

 

Jeff Walter (03:41)

Yeah, it’s, it’s as you were telling that story is really interesting. You just jumped over this. So I was a professional bartender doing competitive bartending, which I’ve never heard of before. So I to ask you what, what is a, what is competitive bartending just for my own knowledge.

 

Emily George of KTA Financial Services(03:56)

Yeah.

 

So I think when I say it, a lot of people immediately envision Tom Cruise and the movie cocktails and the bottle flipping and there, there is a very competitive space for flair bartending. I was not that kind of competitor. There’s a whole different space in competitive bartending that is recipe-based and technique driven. So there’s a very specific method for how you prepare.

 

Jeff Walter (04:03)

Yeah, yeah, yeah.

 

Okay.

 

Okay.

 

Emily George of KTA Financial Services(04:24)

competition cocktails, how you present them. It’s whole thing.

 

Jeff Walter (04:27)

And it

 

is, I know it’s completely off-line, but these are the rabbit holes I like to go into. Is it quality based or speed based? Like if it’s not the flare base, right? I get that. That’s more of the showmanship type of thing. Like the other thing is like, I can prepare a hundred old-fashions in less than 10 minutes. Right? Like, is it, you or you have a competition who can get the a hundred, you know, Cosmos, you know, that, or

 

Emily George of KTA Financial Services(04:39)

Yep. ⁓

 

Sure.

 

Sure. Yeah.

 

Jeff Walter (04:53)

Or

 

is it like the, you know, that the elevated con like, or is it both or is like, I’ve never heard of anything like it.

 

Emily George of KTA Financial Services(04:59)

And

 

it’s usually some combination of those things. Like at its core, there’s a standard for you have to make a certain number of cocktails within a certain amount of time. And it’s usually making five of the same cocktail in a certain amount of time. And there’s a way to do it between two shakers across five glasses.

 

There’s a whole scheme behind that. But then there is also usually an element that you have created this recipe and you are submitting the recipe for judging as well. So it’s kind of a twofold thing.

 

Jeff Walter (05:34)

interesting.

 

Yeah. Yeah. It’s, but it’s not, it’s not a drag race, but, you can’t sit around forever, uh, and daintily preparing these exquisite things that take 15 minutes to produce one cocktail. You know, so, so it’s commercially relevant, right? Because you got to be able to do it at a certain pace, but then the creative freedom to the, well, well, this is Emily’s cosmopolitan or old and it, and it’s, it’s got to, you know, and it’s got a certain signature profile on it’s on tape.

 

Emily George of KTA Financial Services(05:40)

Right?

 

⁓ I mean… Yeah.

 

Absolutely.

 

Right.

 

Jeff Walter (06:06)

So there’s the quality. I’m not surprised, but I never heard of it. so I want to this down there. But then you just skipped over. And then I went to work for a tech startup, and then I ended up in franchising. I’m like, how do you go from bartending? So if you’re doing competitive bartending, you’re obviously hip deep in the culture.

 

Emily George of KTA Financial Services(06:10)

Yeah. Yeah.

 

Mm-hmm.

 

Jeff Walter (06:31)

We had you go to the tech startup and then, and then it’s like, okay, now you’re more in corporate America and then, and then getting into franchising, you know, but what made the jump from bartending to tech startup?

 

Emily George of KTA Financial Services(06:35)

Sure.

 

Yeah.

 

Yeah, so for me, it has always been people. And it was the same bar where I met Daryl, where I met another gentleman who was creating an app that became the predecessor to Postmates. So we were a regionally specific concierge delivery app before the idea of having stuff delivered was really a thing. And

 

Jeff Walter (07:00)

Okay.

 

Emily George of KTA Financial Services(07:11)

Webb had always kind of joked like, someday we’re going to work together and someday we’re going to do something together. And there was a day that it was finally possible. And he kind of took a bet on me and offered me an opportunity to help build process and procedure for that app. And it went really well. We had a whole lot of fun doing it. It was a whole new world to me. I met a lot of new people. And one of the people that I met

 

through the Wentz app project was building a boutique web design and development agency that put some of the first stores on Shopify’s enterprise platform. So when that kind of became a real thing, I then moved over to that agency and I was kind of like that startup catch-all person. was…

 

Jeff Walter (07:40)

huh.

 

Wow. Wow.

 

Mm-hmm.

 

Emily George of KTA Financial Services(08:03)

the first W2 employee that was then responsible for hiring all the contractors to become W2 employees. And like I was the HR person when we needed an HR person and this person when we needed that person. And it really just helped me to build these skills of taking everything as it comes. And the business is what it is today. And there’s a plan for where the business is going to go in the future.

 

How do we get from point A to point B and keep things going in the middle? Huge, incredible learning opportunity for me. And again, like continued building relationships and networking. And it just always comes back to the people for me. It’s who do I know? Who have I met? Who have I built a relationship with that kind of creates the next opportunity and the next thing?

 

Jeff Walter (08:51)

Yeah.

 

Well, you know, it’s, you know, I heard somebody say, you know, it’s, you know, well, it used to be like, you know, it’s not what you know, it’s who you know, but it’s, but that’s incomplete. It’s, you have to have the competency and then is the ante into the game. And then, and then having a bunch of network is, it helps tremendously. But, ⁓ but, the cool thing, yeah, go ahead.

 

Emily George of KTA Financial Services(09:15)

Yeah.

 

Yeah.

 

You have to care enough about them to know something about them and what drives them and what they’re doing, and then share enough about yourself that it makes that connection interesting. And you can kind of find those strings that bind you together and kind of take things to the next level. But if you’re not interested in people, if you don’t care about getting to know them at all,

 

Jeff Walter (09:28)

Right.

 

Emily George of KTA Financial Services(09:49)

they’re never going to get to know you in such a way that a really meaningful connection can happen.

 

Jeff Walter (09:55)

You could 100 % agree. The other thing you said that was really interesting.

 

Was, and I think it’s a, I think it’s a people, especially young folks or folks that are entering a field don’t appreciate is going to work for a small emerging company because I’m not talking about a small mom and pop business that has a street corner. I’m talking about a business that’s at ground level and it’s going somewhere because there is

 

and having been an entrepreneur myself for over 20 years now.

 

You’re trying to get somewhere. There’s an unlimited number of things that need to get done. And you don’t have departments of people to do it. You know, when you’re larger billion dollar company, it’s like, I got a marketing department with a hundred people. I’ve I’ve got a sales team with hundreds of people. I’ve everything is I have hundreds of people that do this thing and they’re really good at it. Right. But, ⁓

 

But as you’re emerging, as you’re, as you’re going from that, you know, and climbing, like I don’t have a marketing department with hundreds of people, but you know, but I got Janay and she’s wearing this other hat, but she’s really good at content creation. Right. And if, and if you grab the bull by the horns, which it sounds like you did, like you, you’re that person. Well, gosh, just listening to your story, you sound like that person.

 

Yeah. As somebody that wants to get into an industry, it’s a, it’s a great opportunity to get experiences that you would never get in a larger corporation because there’s so many things that need to be done in a small emerging company. You could, it’s basically just take, you know, accrete whatever responsibilities you want to and the experiences you want to have. And you can really leapfrog your career because you were given the opportunity to grab onto something that, you know,

 

Emily George of KTA Financial Services(11:41)

Yeah.

 

Jeff Walter (11:51)

quote, you you weren’t qualified to do, but other than your tenacity and industriousness, you know, so it’s, interesting.

 

Emily George of KTA Financial Services(11:54)

Really.

 

I like some of that may come from, so I graduated college in 2005. Three years later, 2008 happened and the economic crisis that that was. And at the time in 2008, I was just starting my career in hospitality, in restaurants and becoming dedicated to the idea that that’s what I was going to be doing for the foreseeable future.

 

Jeff Walter (12:11)

Yep.

 

Emily George of KTA Financial Services(12:29)

And if there was a time that the economy turned around and circumstances were different, it was never going to be like that there was a perfect, one perfect job for me out there. I was going to be creating whatever the job was that I was going to take on. Like, and having that mentality and that mindset of like, there’s no one perfect job description.

 

That may be the case for someone out there that they can read a job description and say like, that’s me. That has never made sense to me. That’s never washed for me. It’s more been about like, what weird thing can I kind of get into and then create what needs to happen? What is the pathway? And leave behind me jobs that other, I love giving away parts of my job. I love.

 

Jeff Walter (13:03)

Yeah.

 

Emily George of KTA Financial Services(13:20)

you know, that practice of creating something that didn’t exist before, giving it away so I can create the next thing. And I don’t know if it’s really correlative to kind of coming of career during an economic crisis, but it just never felt to me like there was going to be a specific job that I could just step into and do that specific thing. It was always going to be kind of creationist.

 

Jeff Walter (13:43)

What?

 

Yeah. Well, you know, I think that’s a, that’s really excellent career advice for individuals. And the, and the other thing that’s really, as you were saying that, and I, I’ve always felt you, you grabbed that responsibility. had a mentor once that said, if there’s a job you want, start doing it now. And, and like, but, but, you know, I’m not the manager of blah, blah, blah, or I’m not the senior.

 

Emily George of KTA Financial Services(14:03)

I love-

 

Jeff Walter (14:11)

designer or blah, blah, blah. He’s like, you just start doing the things you want to obtain. And if you’re in any type of merit based organization, you know, you’ll, you’ll be recognized and you’ll, and you’ll, you’ll be elevated there. And he goes, and it’s like the complete opposite of what we’re kind of taught, which is like to get from here to there. I have to accrue all of these, um, accreditation or experience or

 

Emily George of KTA Financial Services(14:17)

Yes.

 

Jeff Walter (14:40)

whatever the boxes you have to check are and then and only then can you do that thing. And he was like, if there’s a job you want, just start doing it. You know, now you won’t have the perks to come with it. You won’t have the salary that comes with it, but that, but it’ll be so apparent if you’re any good at it, which you won’t be at the beginning, but you will become because it’s the interest. You’ll get those perks in that, in that compensation because you’ll be doing a job. And it.

 

And if you, and if it doesn’t happen at your current employer, you go to the next guy and you go, I’ve been doing that for three years. And, and you’ll get compensated as somebody who’s been doing that for three years. And, ⁓ and then it also, it reminds, and we’re kind of way off topic, but these are the rabbit holes I like to go down. and I’m having a lot of fun, but it also reminds me this book I read years ago called, ⁓ first break all the rules. I don’t know if it’s, it’s. And, ⁓ it was the guy’s.

 

Emily George of KTA Financial Services(15:32)

Ooh.

 

Jeff Walter (15:36)

The folks over at the, I forget what the big polling agency was, but anyway, they, they, they studied high performing organizations and what, what makes a high performing organization and yo, is it the charismatic leader? Is it this, is it that market opportunity? Like all these different dimensions. And the interesting thing is, and it goes back to the name of the book that they ended up publishing was.

 

Emily George of KTA Financial Services(15:43)

Hmm, okay.

 

Jeff Walter (16:01)

Oh, we tend to take an engineering view to an organization. And it’s what, you know, and it’s the, it’s the pigeonhole thing. It’s the, the, the, and I call it kind of the HR mindset, but I don’t mean that in a derogatory. It’s like, I have a marketing assistant, a marketing assistant has these responsibilities. They do A, B and C in order to be a good marketing assistant. They have to have these experiences X, Y, and Z.

 

hire somebody that does it. And then when the person becomes a marketing assistant, we do the annual review and we say, Hey, Emily, you’re really good at A and B, but you’re not so good at C. So let’s give you training and other things to help you, you know, get better at C. And they said, that’s not how high performing organizations work at all. What high performing organizations do is they have those guidelines. It’s not anarchy. They still have marketing assistants in that.

 

But they hire you and they still have requirements to get hired and all that kind of stuff. But then they go, Hey, a marketing assistant does A, B and C, you know, is supposed to do response was A, B and C. Emily, you’re really good at A and B, but you’re not so good at C. We’re going to take that off your plate. We’re going to, and we’re going to add D which has nothing to do with a marketing assistant, but you’re really good at it. And, and they basically mold the job to the strengths rather than

 

try and create Renaissance people, which is the whole theme of the book, is we’re trying to create Renaissance people that can do all these things. And really what you want to do is play to the person’s strengths and mitigate their weaknesses by removing responsibilities associated with their weaknesses. And if you do that systematically, you end up with a very high performance. That’s the key. It’s not charismatic leadership. It’s not having bright product. It can be, it’s,

 

playing it’s basically play to people’s strengths, which sounds so obvious, but it’s not what we do. And the cool thing, I’ve never thought about it from this perspective before. The cool thing when you were, when you were telling about your back, about your thing is like, that’s the individual version of that. Right. It’s you’re like, I’m going to accrete these responsibilities because that’s what I want to be doing. And I’m good at, and I have a, a knack for it. And I’m going to, but with it comes the other part is I got to

 

Emily George of KTA Financial Services(18:11)

Yeah.

 

Jeff Walter (18:23)

hand off these other responsibilities. And, ⁓ that’s really cool. So, so, okay. So you’re at KTA. So what does KTA do? KTA Financial Services? What do do? Why do clients ask them? What clients hope to achieve when they, when they hire KTA for their services?

 

Emily George of KTA Financial Services(18:25)

Right. Yeah.

 

Yes, here we are. ⁓

 

Yes, so.

 

Yeah, I mean, it’s the sexiest thing in all of franchising. We do bookkeeping and accounting services for franchisees. So it is, and it was, there were many things that drew me to KTA when the opportunity came up. And kind of to your point, one of the things that really struck me, at its core, it is a phenomenal offering.

 

We talk so much about unit level economics and franchisee success in the franchise space. this is where it starts. It starts with financial performance and profitability. So at its core, is foundationally a great product. And then talking to the founding team, one of their first comments to me is there are no sacred cows here, which is a phenomenal mindset when you’re still growing a business. Like

 

Foundationally, yes, strong product. Are there still opportunities to improve this product? Absolutely. And that’s a beautiful cross point for me. So franchisees tend to find us when there isn’t a solution within the system that they have invested in to get good financial clarity, to just get foundational bookkeeping and accounting services.

 

Jeff Walter (19:55)

Okay.

 

Emily George of KTA Financial Services(20:02)

Brands tend to find us when they haven’t put in place structure for good financial practice within their system. And they have grown to a point where it has started to get out of control and they can’t manage, you know, 20 different chart of accounts and profit and loss statements that come in six months late. It becomes really hard to coach franchisees when you aren’t coaching from the same playbook.

 

And again, all of that starts at financials. Is the unit profitable? Why or why not? And if you just have no line of sight to the books, it’s not good for anybody. So KTA provides that financial clarity with on time profit and loss balance sheet. And we integrate with analytics systems. So franchisees can see analytics across the system.

 

Jeff Walter (20:59)

Yeah, it’s really interesting. when we talk about scaling, it’s, well, I started off my career building accounting systems as a developer for oil and gas companies, Shell, Exxon, those guys. accounting goes deep through me. But I found it really…

 

Emily George of KTA Financial Services(21:14)

Mm-hmm.

 

Sure.

 

Jeff Walter (21:23)

As I’ve been getting more and more into the franchise space and understanding it more and more, we talk a lot about the acquiring customers and ⁓ closing deals and servicing them and building the processes for that. And what’s started to merge over the years is I’ve talked to more and people is there’s a, the average franchisee tends to have a limited financial acumen.

 

They’ve never managed a P and L before. And, ⁓ and, managing a P and L is very, very different than managing your checkbook. You know, it’s a, you know, they’re, they’re apples and oranges, right? Still money, but completely different way of doing things. And, and, and it’s interesting because as I’ve talked to more and more people and I’m prepping, I was asked to do the scaling workshop in November,

 

Emily George of KTA Financial Services(21:55)

Yes.

 

Jeff Walter (22:12)

Next, next, next February, it is November. but I’m sure, you know, I’m trying to figure that out and going, there’s this, and you, I like the way you said it. It’s foundational is that there’s this financial knowledge that is foundational. And as I talked to me for franchise oars, to your point about not the brands, not addressing it’s like it either they’re like, well, we’re looking for good fit.

 

And, we, we, you know, we’re getting the right types of people, but, know, it’s one of these things, you know, this is one of those areas where they’re not bringing a, you know, the, the, the, knowledge and, and, and we don’t really teach, we don’t really train them on that. and, you know, especially if you’re like a developing franchise, like you’re so focused on the bits and bytes of your thing, that this is a more horizontal fundamental thing. And, ⁓ and, they struggle.

 

And then I was talking to one franchise or that was really interesting. they recognize the problem. They don’t try and, and this is the training impact podcast, which we focus on training. weren’t trying to train them. They solved the problem by saying, here’s our partner. you have to use them for the first year. After that, you can use whoever you want for keeping your books and doing your financials and all that other stuff.

 

Emily George of KTA Financial Services(23:20)

Thanks.

 

Jeff Walter (23:32)

but you have to use these guys for the first year because we’re just trying to, we are all trying to just turn you into a successful business. And so let’s not worry about this. Let’s just bring these partners in. You got to use them after a year. You can do whatever you want. I was like, huh, that’s a really interesting way of solving the problem is you go, you know, I’m not going to require you to do it forever. You know, like I’m, I’m not married.

 

to the CEO’s sister, you know, like, like, but no, this way to your point, like we get, we get our financials. You don’t have to worry about it. I know you don’t have your, you know, brother-in-law’s cousin doing it for a nickel a day and they’re crashing on your couch in your basement. Like I know I’m getting, and, and, and it creates that foundation. So I thought it was really interesting what you, what you said. It’s just fascinating.

 

Emily George of KTA Financial Services(24:26)

Well, and one of I think one of the beautiful things about franchising is that it really does offer a pathway to business ownership for so many people to whom it would otherwise not be available. When I think about the number of franchisees I have spoken to throughout my career and like yourself, one of the questions I always ask is kind of like, how did you find franchising? How did you get here? Like

 

What did you do before this? And how did you choose this franchise in the end? Like those pathways are as varied as the people that come with them. And sometimes it is, you know, I’ve always been a beautician. And so the idea of owning a salon concept felt, you know, like they’re kind of into the widget of the business.

 

Jeff Walter (25:16)

Yeah.

 

Emily George of KTA Financial Services(25:16)

or I’ve been in corporate America, I’ve been doing these things and I’ve just always wanted to own my own business. So I found my way to this concept and I believe that it’s the most financially viable. They come in a number of different ways, but very rarely is the franchisee an expert in the widget, an expert in being a business owner, an expert in all of these things that they need to do to ultimately operate.

 

franchise. And to your point, the franchisor is really only responsible to train you on a limited scope of the business. It is not their responsibility to train you to be a financial wizard or to train you to be an HR pro. And so there’s this like very fine line of

 

Jeff Walter (25:59)

Yeah, yeah.

 

100.

 

Emily George of KTA Financial Services(26:14)

How much does the franchisor provide? Where does the franchisee fill in gaps? And it’s exactly where suppliers come in and become the third leg of the stool that gives structure to franchising. There’s the franchisor’s responsibilities, the franchisee’s responsibilities, and suppliers that fill in the gaps and help make all of the magic happen and connect the dots.

 

Jeff Walter (26:39)

Yeah. Well, I think I see that pattern over and over as I talk to folks and you nailed it right on the head. You know, there’s a bunch of skills that are necessary to successfully run a business. And, know, some of it’s the, you gotta understand the market because you’re how to find prospects, how to close deals, how to deliver the service, how to manage people, how to, you know, how to keep a good set of, there’s a lot of different hats.

 

Emily George of KTA Financial Services(26:56)

for sure.

 

Jeff Walter (27:08)

And usually folks are coming in that are really good at one, maybe two of those hats. But then there’s all the other hats. And I was talking.

 

Emily George of KTA Financial Services(27:14)

Sure.

 

Yep. And they’re dealing

 

with, you know, like making an investment into a business and they’ve probably borrowed from their 401k or taken out a loan. there is, there is price sensitivity to opening a business. But again, finding that balance and you know, we experienced it when I was at RevLocal and it was marketing and

 

Nobody wants to spend marketing dollars, but everyone wants to see the accounting for every penny of marketing spend. And nobody is a marketing expert that decided to become a franchisee. So like I kind of saw that cycle first at RevLocal and have continued to see iterations of it. And it continues to be true in the bookkeeping space because yeah, like everybody’s got an uncle.

 

Jeff Walter (27:54)

Right.

 

Emily George of KTA Financial Services(28:07)

or everybody’s got a somebody in their ecosystem that can do the books. But are they really doing the books with a lens of understanding franchising, understanding your specific business, keeping things in line for the system? That gets to be a different thing. And all of sudden you’ve got 50 uncles doing bookkeeping and

 

Jeff Walter (28:08)

All right.

 

Yes.

 

Emily George of KTA Financial Services(28:32)

a system that can’t make heads or tails of any of it.

 

Jeff Walter (28:35)

Well, and the other thing, and I think this is underplayed by a lot of folks, just in general, they say nothing of the franchise eSpace, is that’s just keeping the books. The books are not some type of compliance thing. They’re actually a tool to help you manage your business. so, like getting good books is just step one, but then it’s also understanding

 

Emily George of KTA Financial Services(28:46)

sure.

 

Jeff Walter (29:02)

What are the books telling me about my business and how do I, how do I take that as input to, to proactively manage the business? And, ⁓ and then, to, so to your point, like if you’ve got, you know, that step uncles cousin doing it, ⁓ you know, it, even if you have a decent set of books, like it’s, still got to learn that the average person still has to learn. how do I interpret this?

 

Emily George of KTA Financial Services(29:11)

Yeah.

 

Sure.

 

Jeff Walter (29:30)

To say nothing of a balance sheet. Like, yeah, we’re just talking about the profit and loss statement. there’s, then there’s a whole balance sheet. And what does that mean? And how do you change what you’re doing? You know, like you’re saying, like you’ll, you’ll micromanage the marketing spend, what do you, you know, of like, well, no, I’m going to spend 5 % on or 20 % on or 30 % on this thing. What metrics am I putting in place to feel comfortable that I’m getting a return on my investment?

 

Emily George of KTA Financial Services(29:30)

Cool. Yep.

 

Yeah.

 

Jeff Walter (29:58)

You know, it’s, it’s interesting. One of the things that, and this is from the, I thought of this on the train, in the training space, but it’s, it’s generally applicable. And I thought about, huh, that’s really interesting. I never thought about that. So most training programs are reviewed as a cost of doing business. Right? Like I gotta do this. Everybody expects it, but it’s, not a strategic investment, you know? And so, and that’s how most people that run their programs, they’re like,

 

Emily George of KTA Financial Services(30:20)

Hmm.

 

Jeff Walter (30:25)

Well, I get this budget from my organization and I’m asked to do whatever I got to do and I do it within this budget. And then every year I go ask for a bigger budget, right? Because there’s this infinite demand for knowledge. And I finally started telling my clients, Mike, look, you got to understand the executive mindset. And this is something interesting. I never thought about this applying it to franchisees.

 

But you got to understand the executive mindset. Executives only do one thing. Like we think they do a lot of stuff. I’ve been an executive for a long time. We really only do one thing. Allocate money. That’s all we do. You know, and we sit there and go, Hey, we’re this year, we’re going to spend X dollars on marketing. Y’s dollars on my sales team. Z dollars on my production. I’m just, I’m just putting buckets of money out there. And the executive mindset goes,

 

Emily George of KTA Financial Services(31:06)

Sure.

 

Sure.

 

Jeff Walter (31:20)

There’s really only two things I spend money on. Stuff I got to spend money on because I gotta, you know, either from a legal compliance standpoint or just everybody expects it. And it’s just the cost of doing business, right? I have to have a call center because my customers have to call. I gotta file my taxes. I gotta have the, I have to have it. I have to have my books done or else the IRS is going to yell at me. Right? Like there’s, there’s things I just gotta do.

 

And then there is strategic investments and they tend to be, you know, and, that’s where I put a dollar in and I get $2 back. Right. And so the, to me, the challenge for, you know, on the training side is, well, how do you go from, you know, cost of doing business to strategic investment or for anybody, how do you go from one to the other? Because on a strategic investment, if it’s $1 in $2 back, that’s where the executive wants to put her money.

 

Emily George of KTA Financial Services(32:20)

Yep.

 

Jeff Walter (32:20)

right?

 

They want to spend as little on the have to cost of doing business and as much on the investment because that’s where they get the returns. Right? And so it’s interesting because I was saying, I didn’t think of this in a larger sense of what you were saying with measurable returns like a marketing is, well, that’s where the rubber hits the road. It’s like, I’m going to 20 % or X dollars on marketing.

 

It’s not about scrubbing and micromanaging every nickel. It’s like, what do I hope to get from that money? Am I going to get a hundred leads? Or am going to get a thousand people through my door? Like, what am I hoping to get? So it’s interesting to, I never put the two together. I want to talk about it in terms of training. So thank you for helping me ⁓ connect the dots there. That was cool. So if you were an emerging franchisor, right? You’re somebody.

 

Emily George of KTA Financial Services(32:56)

Two. Three.

 

Yeah, sure.

 

Yes.

 

Jeff Walter (33:14)

Yeah, we’re on the Zor side of things. You’re somebody that had this idea. saw this need in the marketplace. You got your couple of company stores. We have really fleshed out the idea and now you’re franchising and you’re starting to, know, and it, and it’s something that’s hitting the market. The market’s like, yes, yes, yes, yes, yes. I want this. and so you start, you know, selling franchises and, and, and now you’re kind of on that upward slope, but there’s

 

only a handful of you that actually know what’s going on and your time, there’s just a hundred people pulling at you.

 

What are some of the lessons learned that you’ve seen that, you know, both from the financial side, but then also from the other pillars, acquiring customers, closing them, delivering the services that are, how do you get from, you know, a couple of franchisers, franchisees that bought into you, their belief in you as a franchisor to the 200th

 

Emily George of KTA Financial Services(34:08)

Mm-hmm.

 

Yep.

 

Jeff Walter (34:14)

location where they don’t really know you. They know of you. They don’t know you as the franchisor. What are some of the lessons learned you’ve seen there as you get from A to B?

 

Emily George of KTA Financial Services(34:17)

Thank

 

Yeah.

 

Yeah, so I think very similar to the conversation around how franchisees kind of come to your brand because they’re passionate about the product or they just want to be a business owner. I think it’s equally the case with franchisors. Oftentimes founding franchisors are really passionate about the thing, whatever the original product is. They are that thing first. They were a dog groomer or a salon owner or

 

Jeff Walter (34:47)

Yes.

 

Emily George of KTA Financial Services(34:56)

an in-home care provider, they were that thing first. Now they’re becoming a franchisor. And that is a whole, like the transition from founder to franchisor is a wild transition that not everyone can or will make gracefully. And the more a franchisor can embrace and have an awareness of this new

 

role that they are taking on and the new responsibilities because it’s not about, know, like one of the things I learned so clearly from working with Paul Rocchio at the IFA was it’s not about the widget anymore. It does not matter if you are flipping burgers or grooming dogs or whatever. You are a franchisor and that’s the business you are in. You are in the business of franchising and

 

Jeff Walter (35:50)

Alright.

 

Emily George of KTA Financial Services(35:51)

providing that service to your clients who are now franchisees. And the faster a founder can make that transition and accept that responsibility and take it to heart and start getting really serious about putting the structures and systems and suppliers in place that will help their franchisees grow, the better off they will be.

 

One of the things we see far too often is we started franchising the concept and the lawyer told us that we needed to have tech fees and marketing fees and we needed to collect royalties and we needed to, the lawyer told us we needed to do all of that. Well, it’s in our, it’s in our FDD. It’s in our franchise agreement, but we don’t do it. We don’t collect the marketing fund.

 

Jeff Walter (36:36)

Yeah.

 

Emily George of KTA Financial Services(36:45)

We don’t collect the tech fee. We don’t enforce expectations on our franchisees. And now we’re 10 franchisees deep and we have to rein this system in. I heard a really fascinating, like a very funny thing at the FBR summit recently where compliance has a PR problem.

 

Jeff Walter (36:58)

Bye.

 

Interesting.

 

Emily George of KTA Financial Services(37:06)

And like there’s a lot of conversation around compliance in franchising. And when compliance has to get to legal letters and cease and desists, nobody, like don’t let it get there. It doesn’t have to get there. If you reasonably enforce accountability in your system from early on and provide franchisees with reasonable tools and partners to help.

 

them do the things they need to do, you can make compliance a pretty happy thing in your system and something that helps drive, you know, that competitive spirit in your system. Like, I love a system where franchisees want to beat the biggest guy in the system. Like that’s really fun. And it’s motivating for people to drive towards a higher achievement as opposed to just like, like

 

just ultimate stress, I need to keep my doors open tomorrow and make payroll on the 15th. Nobody wants to be there and then to have compliance conversations on top of that. Like, let’s help compliance have a better PR image and just make it a positive experience from the beginning.

 

Jeff Walter (38:21)

And can you elaborate on what you mean by compliance? Because a lot of people will hear that and think governmental regulatory compliance. So when you say compliance, what do you mean by compliance?

 

Emily George of KTA Financial Services(38:33)

Yeah, so there’s certainly the government regulatory compliance aspect of franchising, but then at more micro level within a system, there is compliance to the franchise agreement, compliance to the operating manual. There’s the compliance of the franchisee to comply to kind of the rules of the system, if you will. So whether it is submitting a profit and loss statement by the 15th of every month or

 

Jeff Walter (39:01)

Mm-hmm.

 

Emily George of KTA Financial Services(39:01)

using, you know, executing a certain number of dollars or a percentage of revenue in marketing spend in a certain time period, there are requirements outlined in the agreement that franchisees have to be compliant to. And it’s ultimately the responsibility of the franchisor to hold them accountable to those things, because franchising is truly the rising tide that raises all ships or the wave that sinks them.

 

Jeff Walter (39:27)

Right.

 

Emily George of KTA Financial Services(39:31)

And if the franchisor doesn’t hold every franchisee accountable, it sinks the system pretty quickly.

 

Jeff Walter (39:34)

I had heard that.

 

I’ve heard the rising tide metaphor, but I haven’t heard the wave that sinks everyone. That’s like, I got to write that down. ⁓

 

Emily George of KTA Financial Services(39:43)

There you go. That’s the

 

gift to this podcast.

 

Jeff Walter (39:50)

Well, it, on, on the compliance side too. And I think it goes back to your compliance as a PR problem. And I, and it’s, it’s interesting because I see this in the training sector, in the learning development sector, especially when you’re training external, partners, right. you know, like the franchisees and it gets back to that executive mindset thing. If it’s like, you must have people that take the, you know,

 

Emily George of KTA Financial Services(40:02)

Mm-hmm.

 

Jeff Walter (40:16)

The franchise agreement says that you have to have four people that took this training and three people that took that training and blah, blah, blah, blah, blah, blah. Then the partner looks at is like, it’s a box. got to check. How can I do this in the least annoying way as possible and just get my box checked. Right. And unless, and then I’m not going to really focus on checking the box unless somebody’s complaining to me. Right. And.

 

Emily George of KTA Financial Services(40:34)

Meh.

 

Sure, yeah.

 

Jeff Walter (40:44)

But one of my clients, was one of the big automotive OEMs here, on the training side, they spread throughout the universe of their network. A certified salesperson sells twice as many vehicles as an unsertified salesperson. A certified service technician has this higher performance and customer satisfaction than a non-certified. So, know, Mr. dealer, you know,

 

I can’t force you to get these people certified. I don’t have that carrot. got a couple, I have a couple of carrots and a couple of sticks, but to your point, I can’t force you to be compliant and have everybody trained. can just tell you this and then training goes from a compliance thing to a. Well, if you want to, I don’t know, have a successful business, you might want to look into this. And, and the things that you’re talking about, I think it goes into that too is.

 

Emily George of KTA Financial Services(41:31)

Absolutely.

 

Jeff Walter (41:35)

You know, the, the, governmental compliance is one thing we just live in a society and it’s got a set of rules and you know, vote differently if you don’t like those rules, right. but, or, or lobby or do whatever you want to do, get the, get those rules changed. But when we, when you’re within a system, we’re all there voluntarily. And, and, and it’s when those compliance things are viewed as checkboxes that you have the issue and, and, and it’s.

 

And it’s, what is the value of that thing? Like, what is the value of the marketing spend? Where do I get value out of like, you know, and, I think that’s actually, okay.

 

Emily George of KTA Financial Services(42:09)

No. Well,

 

if you’re willing to or if you have to distill your business down to compliance and check boxes, you are missing so many opportunities to really value add in the business. Like, what a shame when you have to get so stick driven that you just don’t have any carrots and like

 

Jeff Walter (42:26)

Mm-hmm.

 

Emily George of KTA Financial Services(42:38)

Just don’t let it get there and kind of keep it in a space where you are driving more performance than having to just check boxes to get through.

 

Jeff Walter (42:50)

So, so, and I think there’s an interesting balance too, because it’s that we need process, but we want to avoid bureaucracy. And it’s not obvious where one ends and the other begins, right? Cause the, the franchisee is buying into a business model, which ultimately, you know, and you want to make sure you get the right fit of people and culture, you know, to, to, to, that there’s a good fit there, but ultimately it, it,

 

Emily George of KTA Financial Services(43:01)

Sure.

 

Mm-hmm.

 

Jeff Walter (43:20)

It, it becomes a set of processes and, supporting technologies and, and, know, and suppliers that end up driving the value through the process. and that’s what they’re buying into. Otherwise they just go start their own business. Right. And, know, and, ⁓ and, and the compliance is really following the process and the, and the more you understand about the process.

 

and the value that the process brings to the table, the more, and that’s where I loved what my client had done is like, I’m just showing you the value of the process. I’m laying out the process. I’m making it as easy as possible, but more important, I’m making, I’m showing you the value so that you want to do that because it’s in your self interest to do that. Because, and I guess I’m taking away from an emerging

 

a franchise or, uh, would be, I would almost say like maybe as a rule of thumb, it’s better to have less process than more. So you don’t get into the bureaucratic, but strictly, but make sure you are holding everybody accountable to the process you have. I think in whatever dimension, because I,

 

think what the tendency to do is to say, that’s a good idea. Add it to the process. that’s a good idea. Add it to the process. And then it becomes more bureaucratic and more of a straight jacket. And then people like, I’m not doing that. I’m not doing that. I’m not doing that. And then, yeah, does that, does that make, do you think that makes sense or

 

Emily George of KTA Financial Services(44:44)

Sure.

 

Sure. Yeah.

 

Yeah, I think that makes really good sense. And it’s that adherence to accountability that gets everybody. At the beginning, you are attracting usually your family and friends or people who are passionate about your product. And they tend to be the hardest people to hold accountable. And it’s so easy to just say, you don’t have to do that now. That’s going to be like for the real franchisees when we get there, like

 

That’s going to be for those guys. But then all of a sudden you find yourself on the 15th franchisee and you’re still not holding them accountable to the things that are supposed to make your system run. And then all of a sudden you can’t validate the brand and you don’t really have proof of concept and you can’t write an item 19 that makes the look of sense like that accountability from the get go. It doesn’t have to be the most complicated system in the world.

 

You just have to have a system and stick to it.

 

Jeff Walter (45:57)

Yeah. And I would, I would suggest and keep it as simple as possible while still getting the outcomes from the system that you as the, as the franchisor wants, wants to get. And I love what you said earlier that circle back around that, that when you go from founder to franchise or you’re no longer in the business of the thing you’re in the business of franchising.

 

Emily George of KTA Financial Services(46:02)

Thank you.

 

Yeah.

 

Yup.

 

Jeff Walter (46:25)

And that I’d say is a, if you’re on that emerging developing franchise or is something to meditate on. you really like when you know, you are no longer the founder of a thing that delivers this amazing service or product. You are the, the owner of a set of processes that do great things for the world.

 

Emily George of KTA Financial Services(46:49)

Yes.

 

Jeff Walter (46:49)

And you’re bringing people and you’re convincing people to share in that process. Do well, part with their hard earned money, do well financially while still doing good things in the world.

 

Emily George of KTA Financial Services(47:01)

Well, it’s

 

often the case that founder franchisors are learning those lessons at the same time franchisees are learning the lessons of becoming a franchisee. So like now you’ve got this layered challenge of a franchisor who’s learning how to be a franchisor and a franchisee who’s learning how to be a franchisee and the franchisor has never been a franchisee.

 

Jeff Walter (47:13)

Right.

 

Emily George of KTA Financial Services(47:28)

and they don’t necessarily know how to talk to one another. yes, keeping things simple, bringing in expertise where you lack it, having just an awareness of the things you don’t know, you don’t know. And how can you fill those gaps as quickly as possible to help scale your system?

 

Jeff Walter (47:48)

Yeah. And you know, you just reminded me of something else. I love these back and forth because I learned so much and then I cross pollinated all the stuff in my head. You just reminded me something else when you said, you know, bring folks in or bring suppliers in. I had another, and this was recently, you know, person I hold in high esteem. And I was, so I’m a business owner and I run my business. I’ve been doing it for a while and I think I know what I’m doing.

 

So, but anyway, I was talking about this one thing. and, this, this mentor of mine, this person, I hold high esteem because Jeff, you know, it was related to the business, right? It was like, I was focusing energy on this thing that wasn’t right. I needed it to be right. you know, I’m, I’m doing this, that, and the other thing. And she goes, Jeff, you’re, you’re the owner.

 

You have so much more valuable things you can be doing with your time than that thing. Just go find somebody to do it. Like it, and it wasn’t like seminal to the culture and core of what, you know, our, our, our LMS and yeah, it wasn’t something that’s like at the heart of what we do and our value proposition to the world. It was like this tangential thing over here, but I had like gone down that rabbit hole and Mike.

 

Emily George of KTA Financial Services(48:44)

Yep.

 

Sure.

 

Mm-hmm.

 

Jeff Walter (49:05)

you know, I’m spending hours trying to figure out, know, how, you know, she would paint the walls blue or purple. Right. And she’s like, just get a design, you know, like, and then, you know, the, the advice was something like, just get a design consultant and tell them, they’ll tell you what color to paint the walls. Like stop wasting. got so much. And so I think that’s part of that learning to be a business owner as a franchisee is your time. The thing you don’t have in, uh, in abundance is time.

 

Emily George of KTA Financial Services(49:28)

Yeah.

 

Totally.

 

Jeff Walter (49:36)

Your

 

time is a valuable quantity and you need to focus it on the highest value added things ever. And like you said before, actually ties back to what we said at the beginning and you need to offload, whether it’s to a staff member or a supplier, those things that you can do, but they’re not adding a lot of value because your time can be applied to these other things that can create so much more valuable for your business.

 

Emily George of KTA Financial Services(49:48)

Yup.

 

Yeah.

 

Sure. Right.

 

Jeff Walter (50:05)

It’s interesting. So I’ve been doing this for like decades and this was like somebody, you know, I fall into that trap. fall into that trap and somebody who has never run a business and only been an employee, like those folks escaping the corporate world or, or that, or, or even the artisan who was always the artisan within a larger framework. You know, it’s, it’s, it’s, it’s, I’d say it’s another one of those important scaling lessons is like.

 

Emily George of KTA Financial Services(50:12)

Sure. Yeah.

 

Mm-hmm.

 

Jeff Walter (50:34)

You’re at, love your going from founder to franchise or like, that’s a great way of on the, scaling without sacrificing is coming to peace with you decided to be in a different business. Yes, you’re still making the widgets that you love. And, know, and yes, you know, your heart will be in the R and D or in the lab or in the kitchen, depending on what you’re doing, coming, you know, figuring out the next.

 

Emily George of KTA Financial Services(50:52)

Sure.

 

Jeff Walter (51:03)

iteration of this thing you love. But you’re not in that business anymore. You’re in the business of helping people become business people. ⁓ which I which is an amazing, is an amazing thing. And once you get that on your head, there’s so many more valuable things you can be doing. And then you have to offload those things are cool.

 

Emily George of KTA Financial Services(51:11)

Yeah.

 

Totally.

 

Yeah, there’s a

 

great article that I still share pretty regularly. And it kind of first came onto my radar when I was working in the tech space. And it’s about giving away your Legos. And the idea is that when you’re first in an organization, when it’s a startup, when it’s an emerging brand, everybody has access to all the Legos. So I have every Lego shape, every Lego color. I’ve just got a

 

big box of all the Legos. But as the company scales, you now have to start sorting the Legos. And first you kind of sort it into colors, but it’s still all sorts of different shapes. But I have to give all the white Legos away, or I have to give all the green Legos away. And it’s really hard for people to do that when you’ve had all the Legos. When I’ve had access to everything, wait a minute, but like, you want to take all my white Legos? Can’t I just like…

 

Jeff Walter (51:57)

⁓ huh.

 

Emily George of KTA Financial Services(52:24)

keep some of the white Legos. Like it’s this whole push and pull tension going from this emerging brand where you’ve done everything and you’ve worn all the hats to now becoming a little bit more siloed and giving away the Legos. And then you even get into departments and okay, like now you’re in the white Lego department, but you only get the two by three bricks. This person gets the two by two bricks. This person gets the long skinny bricks.

 

Jeff Walter (52:47)

Right.

 

Emily George of KTA Financial Services(52:53)

You know, like it’s uncomfortable for people and it’s an article that I share with a lot of folks just to say, you’re not the first person who’s felt this way. You won’t be the last person who’s felt this way, but you need to get comfortable sorting and giving away your Legos.

 

Jeff Walter (53:10)

Is that the name of the article, giving away your Legos?

 

Emily George of KTA Financial Services(53:13)

It’s something about if you search medium for giving away Legos, I’m sure it will come up.

 

Jeff Walter (53:19)

I’m gonna check that out. I’d like those things. That’s a good one. That’s really good.

 

Emily George of KTA Financial Services(53:20)

Yeah, it’s a good one. It’s like a five minute

 

read, but it’s such a good analogy for that feeling. And to kind of take it back to that like childlike innocence of this feels uncomfortable to me. I don’t like this feeling. But now I can rationalize it as a professional and handle it.

 

Jeff Walter (53:39)

Yeah.

 

Well, and then, then, you know, it’s like, if I build on that analogy, it’s like, and that’s the only way to build a huge Lego.

 

Emily George of KTA Financial Services(53:53)

Yes. Yes. Yeah.

 

Jeff Walter (53:53)

sculpture because

 

you got to get into the specialization. if everybody’s touching everything, that’s fine if it’s the six of you around the dinner table. Not so fine when it’s 3000 people spread across the continent. And the only way you can get the 3000 people spread across the continent is if you got the white Legals, I got the blue ones, she’s got the red ones.

 

Emily George of KTA Financial Services(54:01)

Mm-hmm.

 

Sure.

 

Yep.

 

Jeff Walter (54:21)

And then, you know, I’ve got a team of 50. Yeah. Yeah.

 

Emily George of KTA Financial Services(54:23)

We know how they fit together. know that they have to, like, the white Legos and the red Legos and that everybody still has to talk to one another, but I don’t need to know everything about all the things. I need to know enough to be dangerous and then I need to let people do what they’re really good at.

 

Jeff Walter (54:36)

Yes.

 

You know, it’s interesting, uh, uh, talk about scaling, uh, latitude, um, had similar type issue, which was like, you know, there was this history or this where everybody got CC on everything. Right. And then it’s like, we grew to a point, Mike, I started and everybody would, as, as a CEO, everybody would CC me on everything. And then I, I, I basically, I was at this one point where it’s like,

 

Emily George of KTA Financial Services(54:54)

yeah.

 

Jeff Walter (55:08)

Only CC me if there’s something you need me to do. Other like, and, it was throughout the organization. Cause like air it’s the Lagos. Everybody was getting every email for everything, but, as a, as an FYI, but yeah, which is fine when you’re like half a dozen people, but not when you’re 600. Yeah. Yeah.

 

Emily George of KTA Financial Services(55:12)

Yep.

 

Sure.

 

Sure.

 

Yeah. Right. Yeah. It’s a fine method of communication when you start, but

 

at some point it becomes not a fine method of communication. And you have to recalibrate that and then create the structure for, now we’re using Slack or we’re using Teams. And here’s how you keep me informed on a certain situation. Here’s where you need to draw me in to be a part of the conversation.

 

But if you haven’t kept me informed, you can’t draw me into the conversation and you start kind of layering in a little bit of complexity, but it’s just enough guardrails to keep things going until you hit the next level.

 

Jeff Walter (56:09)

Yeah. And that’s where I think we get back to the prior conversation of with the franchise or franchisee, the, the French, that founder franchise or as to have that mindset of I’m, don’t have all the Legos anymore. I decided, I decided to franchise. And so I just, and in doing so I’m giving away all the blue Legos. And so I don’t get to play with the blue Legos anymore.

 

Emily George of KTA Financial Services(56:26)

Mm-hmm, yes.

 

Jeff Walter (56:36)

And then as the organization grows and I have a chief revenue officer, I don’t get to play with the red Legos. And then I don’t get to play with the yellow Legos. And then I don’t think like, you know, and, and then, and then those people are like, okay, I got the white, the green Legos, but, now I’ve got it. You know, I’m a, I’m a franchise group or are what, or I’m using an area manager model. And, ⁓ and now I’m not just the guy with the franchise in Ann Arbor.

 

Emily George of KTA Financial Services(56:42)

Yep.

 

Jeff Walter (57:05)

I’m the area manager for Michigan and I got to give away some of my Legos because I’m no longer just the guy running the, the Ann Arbor franchise. Right. I’m, I’m, I have this additional responsibility. got to give away those, those other Legos because, because I can create more value. and, that’s, it also goes back around to that. It’s funny. It’s also goes back around, but yet doing it in a way where you have to have those.

 

Emily George of KTA Financial Services(57:07)

Sure.

 

Jeff Walter (57:30)

processes have to be as simple as possible so that they’re understandable and not bureaucratic, which is where the green Legos and the blue Legos come together, right? Because we’re still building this beautiful statue that has all the colors and all the sizes. And so we have to have a process where it’s like, it’s your turn to put the blue Legos there. It’s my turn to put the green Legos here, right? ⁓

 

Emily George of KTA Financial Services(57:41)

Yeah. Yeah.

 

Sure.

 

Yeah.

 

Yeah, I think people

 

who have worked with me for any length of time start to get sick of hearing me say, I love an exception to the rule, but there has to be a rule first. And it’s because I’ve been in so many situations where it’s like everything is an exception. Everything, but it’s not. It’s not. It just like, you know, everybody thinks their particular circumstances the first time it’s ever happened ever in the world.

 

Jeff Walter (58:06)

Yes.

 

Emily George of KTA Financial Services(58:23)

It’s not necessarily the case. And yeah, just we are not all totally unique snowflakes. We have to have some sort of guardrails, some sort of guidelines, and then there can be exceptions to those things on occasion.

 

Jeff Walter (58:41)

Yes. what, what, and well, we are all unique snowflakes, you know, but you got to operate within that realm. ⁓

 

Emily George of KTA Financial Services(58:50)

Sure, we have

 

so much more in common than we don’t.

 

Jeff Walter (58:54)

Yes. No, a hundred percent, a hundred percent. But if we’re coordinating, we have to operate within our, our area and it’s so, okay. So going back to the key thing on scaling, it’s like, let’s get processes in there, make them as. Make those rules as minimal as possible, but yet still have structure because it’s the structure that the, that your franchisees are buying into. Make sure you get the right people. And then going back to your first part of the conversation is like,

 

Emily George of KTA Financial Services(59:11)

Sure. Yeah.

 

Yep.

 

Jeff Walter (59:23)

Also, you know, financials drive everything. And if you don’t understand that, first off, you got to compile them. That’s the ante into the game. It’s not even the game, it’s the ante into the game. Because then you want to use those to make decisions. And then you have these rules or processes, but make them as…

 

Emily George of KTA Financial Services(59:36)

Yep.

 

Yes.

 

Jeff Walter (59:49)

simple and non-bureaucratic as possible. Don’t hit, you know, almost add things in very judiciously because you, you want to be, because the flip side is you want to also enforce the rules and the more complicated the rules, the more complicated the enforcement, the more you’re going to spend energy on enforcement or let it slide, which is

 

Emily George of KTA Financial Services(59:52)

Yeah.

 

Sure.

 

Absolutely.

 

Mm-hmm.

 

Jeff Walter (1:00:14)

More of the case until something bad happens and then nobody knows what’s going on because it’s arbitrary, right?

 

Emily George of KTA Financial Services(1:00:18)

Yeah. Yeah, you have

 

so much to unwind at that point that it’s hard to even get to a base level. But if you just start with the acknowledgement that the financial performance of every business unit matters and put focus on unit level financial performance, build that into the foundation of your business.

 

And then so much can scale around that when you have good financial clarity.

 

Jeff Walter (1:00:47)

I think that’s just great advice for life period. Much less of business.

 

Emily George of KTA Financial Services(1:00:53)

Right? That was your checkbook, guys. uh-huh. That

 

was your checkbook. Don’t just assume the money’s in there. Like, do your books. Like, regularly and on time and professionally.

 

Jeff Walter (1:01:02)

Yes. Yeah. Yeah.

 

Well, and, and, and use

 

them as tools to manage. That’s, that’s, that’s the, and that’s when it goes from compliance to you’re denying yourself a tool, you know, like, and, and, and you’re driving blind. Like, I mean, that’s the, like, I’m not an accountant. I’m not a bookkeeper. I built accounting systems. So I understand them. But to me, when I first became a manager and started running practices, you know, consulting practices and my own business.

 

Emily George of KTA Financial Services(1:01:12)

this tool.

 

Yes.

 

Yep.

 

Mm-hmm.

 

Jeff Walter (1:01:38)

I’ve always, I’ve always been very accounting driven and books driven, not as a, we need to get another point of margin out of that or blah, blah, blah. But it’s telling me a story about, I successfully

 

Emily George of KTA Financial Services(1:01:49)

Mm-hmm.

 

Jeff Walter (1:01:53)

delivering my value to my customers in a way that is sustainable in the long run. And, and when, and when the story is yes, it’s like your stress levels go down, you know, ⁓ you know, you’re on a good sustainable path. And, and, and it just, and then you’re like, said, you’re using it for, I’m putting a dollar in here. I’m getting a dollar 50. I’m putting a dollar over here because yeah.

 

Emily George of KTA Financial Services(1:01:58)

Sure.

 

Hmm? Yeah.

 

Right.

 

Jeff Walter (1:02:21)

I got to pay the lawyers. need lawyers to write contracts because I don’t know what I don’t know. Right. ⁓ And so I’m spending money on the cost of doing business. I’m spending money on my strategic investments. It’s telling me a story that’s sustainable. Life is good. Or it’s telling me a story that says, Hey, something’s off here. You need to start rethinking some things. And I think that’s awesome.

 

Emily George of KTA Financial Services(1:02:26)

Yeah. Yep.

 

True.

 

Right. Well, and ultimately,

 

like for all the franchisees I’ve ever talked to, I’ve never met a franchisee who became a franchisee to lose money or break even. Like every franchisee I’ve ever talked to is doing this because they want to build wealth for themselves. They want to create an asset that they can eventually sell for more than they put into it. Or they’re trying to create generational wealth.

 

Jeff Walter (1:02:54)

Ha ha ha ha.

 

Emily George of KTA Financial Services(1:03:11)

to have something that they can leave to their family. And if you don’t know that story, if you don’t know what the books are telling you, you’re going to get to the end of that agreement and have an asset that you don’t know what it’s worth. And that’s a terrible spot to be in. Those are the hardest conversations to have with franchisees who have gotten to this point of they need or want out of the business in some way, or form.

 

Jeff Walter (1:03:40)

Yeah.

 

Emily George of KTA Financial Services(1:03:41)

and they can’t realize the value of the asset because they don’t know.

 

Jeff Walter (1:03:46)

Right, or they thought it was worth a dollar and it’s really worth 50 cents.

 

Emily George of KTA Financial Services(1:03:49)

Sure. Well,

 

I know I’ve put half a million dollars into it, so I should at least get half a million dollars out of it, but there’s not half a million dollars of value in the thing.

 

Jeff Walter (1:03:57)

Yeah.

 

Yeah, and that’s, yes. And then you’re like, I put a half million dollars in, it’s only worth a quarter million.

 

Emily George of KTA Financial Services(1:04:03)

That’s it.

 

That’s a bad spot to don’t don’t be in that spot. Don’t let your franchisees be in that spot.

 

Jeff Walter (1:04:13)

Yeah, and I would say the other, ⁓ corollary to that, which is very closely tied is a lot of owner operators.

 

are, are, ⁓ relying on the value of their business for their retirement. Yeah. Just, just like most people, I’m like, I’m a huge believer in home and ownership and I’m a huge believer in business ownership. Like I think those are two of the best things you can do with your life. ⁓ because they build assets and wealth and everything, but it’s, but it also creates, well, that’s a whole other podcast about, know, but it’s more metaphysical, but,

 

Emily George of KTA Financial Services(1:04:27)

Totally. Yep.

 

Yeah.

 

Yep.

 

Jeff Walter (1:04:49)

But it’s, you there are so many, you know, most folks end up buying their homes and it ends up being the largest asset that they own after, 30, 40 years. Then when they go into retirement, it becomes this giant wealth nest egg. And a lot of business owners I know, whether the franchisees or just independence, you know, owner operators.

 

that they, they feel there’s an asset there and they, and they’re kind of betting their retirement on it without really knowing whether it’s worth a buck or a nickel. And they, but it’s like you said, well, I put a half million in, it should be worth at least a million. Right. So I’m betting on a million. then somebody goes, it’s worth 300,000. And they’re like, what? And, and, and then the sad thing is that happens at a point in time where you’re thinking retirement.

 

Emily George of KTA Financial Services(1:05:28)

Right.

 

Jeff Walter (1:05:40)

You don’t really have the clock time, the calendar time to sit there and go, how am going to come up with that 700,000 that I was expecting to retire on? Like at least with your house, you can go to Zillow and go, eh, it’s worth about 450,000. Maybe I’ll get 440, maybe a 470, but I’m not going to get 200. Right. And, and with businesses, you can’t really do that. And especially, um, to your point, it’s like, you definitely can’t do it.

 

Emily George of KTA Financial Services(1:05:53)

Sure.

 

Jeff Walter (1:06:09)

If you’re don’t have solid financials, because the first thing any buyer worth their salt is going to do is say, show me your financials for the last three years. Show me the books.

 

Emily George of KTA Financial Services(1:06:16)

Show me the books. Show me the books.

 

And when you can’t, that’s a tough spot to be in. you know, someday maybe it won’t surprise me, but right now it does still surprise me when we run into franchisees who manage their business based on their checking account. And as long as there’s money in the checking account, they keep running the business.

 

That’s how you end up in that situation of ⁓ looking to realize the value and realizing that the value isn’t there. And I would love to see franchisors and franchisees all make the decision that they want to know now and know regularly the financial health and position of their business and use that as a tool that can help them realize the value they want to and really like more than that.

 

Jeff Walter (1:07:05)

Yes.

 

Emily George of KTA Financial Services(1:07:05)

I wanted

 

to exceed your expectations. Like, let’s start having those happy accidents where your business is worth more than what you thought it might have been, but for the right reasons.

 

Jeff Walter (1:07:15)

Yes. Yes. And

 

yeah, well, and that gets into using it as a tool to steer the ship rather than looking at it terms of, this is what I see in a review mirror. Right. And, and then get proactive about it, which is where you got to go. Well, Emily, this was just fascinating. Really interesting. I now know there’s competitive bartending, and, which is really cool.

 

Emily George of KTA Financial Services(1:07:30)

Yeah.

 

Right?

 

Jeff Walter (1:07:41)

But

 

what a really cool journey you’ve had. And thank you for sharing all that knowledge and insight. You spent so many years in the sector, in the franchise sector. And I think for a lot of our viewers out there, it’s applicable to others. The franchise sector is a very specific legal expression of channels. But most of our viewers and

 

Emily George of KTA Financial Services(1:08:01)

Sure.

 

Jeff Walter (1:08:06)

and out there are in the, they have large channels. Now they might be dealers, they might be resellers. It’s where as franchisers are specific type of legal relationship, but it’s the same, it’s a very similar problem set. It’s a very similar problem. How do you make sure you get good resellers? And how do you vet them? And how do you scale your resell network? And it’s a very similar problem.

 

Emily George of KTA Financial Services(1:08:09)

Sure.

 

For sure.

 

Jeff Walter (1:08:32)

The franchise is interesting because it’s a more intimate relationship because it’s legal bound. It’s a marriage versus ⁓ dating. ⁓

 

Emily George of KTA Financial Services(1:08:40)

yeah.

 

Yeah, well,

 

a 10 or 15 year franchise agreement is longer than a lot of marriages, so it’s a very, very connected relationship for sure.

 

Jeff Walter (1:08:50)

And

 

it tends and actually survives a lot of marriages. But thank you for sharing that and helping educate me and everybody out there. greatly appreciate it. ⁓ Before we go, if somebody wanted to learn more or follow up or you got these great insights, how would they get a hold of you? Where did they go? What’s good way to get a hold of you?

 

Emily George of KTA Financial Services(1:08:56)

Right? It does. It does. Mm-hmm. Yep. It does.

 

Yeah, thanks for having me.

 

Yeah.

 

Yeah, so I’m pretty easy to find on LinkedIn. I am Emily George, comma, C, F, E on LinkedIn. You can also shoot me an email. am Emily.George at KTA Financial Services dot com.

 

Jeff Walter (1:09:32)

All right. And if they were interested in KTA, KTAfinancialServices.com. So great. Well, thank you, Emily. I appreciate it.

 

Emily George of KTA Financial Services(1:09:38)

That’s it. That’s

 

Thanks for having me. This has been fun.

 

Jeff Walter (1:09:44)

Yep. And to everybody out there, thanks for listening. We had another fun episode, another fun time, learned a lot and ⁓ we’ll see you next time.