SEARCH FUND CEO – 100 DAY PLAN
"Who has a 100 day plan I can use?" seems to come up again and again in the Search Fund world. I'm a big fan of Searchfunder.com and Search Fund CEO's. Search Funds are like the Fight Club of the entrepreneur world. A small well-kept secret in a tight knit community. Those that are in it, do a ton to help each other out. Those on the outside have no idea it even exists. Having been down this path a number of times as a CEO, I'd like to share some of my experiences as well as those of some of the great CEO's that I've coached.
Tactically speaking here is what you will face in your first 100 days: 3 - Month end closings 7 - Payrolls 14 - Weekly leadership meetings 1 - Board meeting - as you share your results and your plans for the future 1 - Town Hall meeting - as you meet all the employees for the first time 1 - Quarterly leadership planning session - as you regroup with your team, go over your past 90-day results and plan the near-term steps for the next 90 days
As a new CEO, you are also likely to encounter one or more of the following: • Speed bump - loss of a large customer or key employee • Competitor storming the gates - and making a play for a key customer • Employee dispute - anything from a fight in the Denny's parking lot to sexual harassment lawsuit • Vigilante HR manager - trying to overstep their boundaries in the name of safety or political correctness • Tests of your resolve (do you walk the talk?) - when you told them you would be willing to try new things and your receptionist brings in her pet python as her emotional support animal • Previous owner - meddling with your leadership, current employees or client relationships • Supplier problems - letting you down on a major delivery or going out of business all together • Cash crunch - always in short supply. Your bank and your board will want answers
From my experience as a CEO of several companies as well as working with hundreds of entrepreneurial leaders and the new breed of Search Fund CEO's, here are my recommendations:
1. Look at it through a first six months lens vs 100 days[redacted]days is an arbitrary number anyway, likely stolen from US Presidents during their inaugural address.) Take the time to learn about your new business from the inside. Find out what you really have to work with and what you really need to work on. In those six months, take the time to get to know: o Your leadership team - the quality of this team will make or break you o Your top 20 customers - they are the life blood that keeps the doors open o Your top 10 vendor relationships - they keep the lights on and product moving o Your Board of Directors - they should be asking the toughest questions o Your processes and systems - where do things flow and where do they bind up?
2. You may want to move right into action mode and start putting your stamp on the business. Resist that temptation. Here are the things you can do that will create a positive and lasting foundation as you move from searcher to CEO in your first six months:
o Make few promises - You don't have all the facts yet and it's tough to walk back a promise. o Realize your actions have 10x more impact than your words. Whether you notice it or not, everyone is watching. Do you take long lunches, cut out of work early to see you son's little league game, hold closed door meetings, tell off-color jokes? They notice. o Meet everyone in the company. Learn their faces & names. If you can, find out what it is that drives them to come to work every day. It may be a passion to write good code or to pay for their kid's college. They don't care how much you know, until they know how much you care. o Avoid hiring or firing anyone in your first six months (and certainly your first 100 days) if at all possible. Until you have understood all of the company dynamics, just take it all in. o Expect at least one major crisis or disaster. It may not be COVID-19 or a trade war with China, but there will be something. By knowing what/who you have to work with, you better understand your ability to manage the crisis. Here are some of the things that some of my coaching clients faced in their early days of their leadership: Nathan Dey of Navegate - faced both COVID-19 and a trade war. Carlos Meza and Jeff Blacklock of Kivuto - blindsided by the loss of their single largest customer in the first few months after the sale. Joe Avery of Point b Solutions- had one of his largest clients get bought by a Private Equity company who promptly ripped their business relationship to shreds. Mike Siegler of Ecessa- was asked by his Board to turn around a five-year business slide. Once he accomplished that, they immediately asked him to put it up for sale.
3. There are always at least a few things that are being held together with duct tape and bailing wire by the seller. Things that should have been taken care of, but weren't. And even with a rigorous due diligence, some things will slip through. It usually comes down to people. That's life. Now it's your job to find the issues and prepare to deal with them. o The bookkeeper who has given herself new titles and new business cards as the company grew over the years. She complained about being overworked and asked for more pay, but never more training. She hasn't done anything new for 10 years and tells you this business is more complex, so she needed a full 45 days to close each month. o The salesman with the top five biggest client relationships. He owns 29% of the company revenue and even more of the gross margin. He has become a specialist in expensive dinners and golf outings but has not brought in a single piece of new business in years. He won't use the company CRM and doesn't feel the need to show up for company meetings because he's so busy making you money. o The Operations Manager who won't listen to any employee ideas and has most of them running scared every time he looks their way. He has never fired anyone but threatens to do so daily. His screams can be heard throughout the building when the production line grinds to a halt during the annual holiday rush. Things that others know how to fix, but now no one wants to jump on the grenade.
After you have six months of learning and a thick stack of notes on what really goes on inside the business do these three things:
1. Implement an Operating System Adopt a system for cadence, communication and accountability. There are many out there, so pick one that works for you and get started. Whether you do it yourself or hire someone to help you, having a rhythm of expectation and responsibility makes your life as a CEO a lot easier. Here's a few: o EOS (Entrepreneurial Operating System) - Developed by Gino Wickman. o OKRs (Objectives and Key Results) - Developed by John Doerr of Kleiner Perkins. o Rockefeller Habits - Developed by Verne Harnish.
2. Join a CEO Peer Group Shifting gears from a pure hunter that needs to prospect like crazy and finally close a deal after[redacted]months of grinding, to a company leader that needs to tap into the talents of others and bring out the best in them. It's a tall order. Rich Kelley of Search Fund Partners estimates that one out of every seven Search Fund CEO's ends up getting replaced. Having a group of like-minded leaders gives you a safe space to talk about sensitive issues, seek experiences from others who have lived through it and gain insights on where talent can be found. There are a lot of them. Some are national and others focus on a single city. Here are a few: o YPO/WPO - (Young Presidents Organization / Women Presidents Organization) - worldwide organization o Vistage - worldwide organization for CEO's with $5+ million in sales o EO (Entrepreneurs Organization) worldwide organization o Allied Executives - Lead by Kurt Theriault. Minneapolis focused o CEO Roundtable - Lead by Michael Miller. Minneapolis focused
3. Get a CEO Coach In my experience I have found there are two types of CEO's. The DIYer's and the ones who Go Pro. The DIYer's will read some books, talk to their country club buddies and then take advice from the same place they watch cat videos. The CEO's who decide they want to Go Pro, are the ones that regularly reach out to other professionals in their field. They have found that it's much cheaper to pay someone who has experience and scars to teach them, than to make all the mistakes themselves. If it was a good idea for Steve Jobs, Scott Cook, Ben Horowitz, Jeff Bezos, Larry Page and Eric Schmidt, then maybe you can learn something too.
I'll admit, the last one is self-serving because I'm a CEO coach. But I've had enough times at bat to know the right coach can make all the difference. I specialize in working with CEO's in their first three years of leadership of a business that has 50 employees or more.
I'd be interested in hearing your own stories of your first months of leadership as well.
Recommended reading: Trillion Dollar Coach - by Eric Schmidt, Jonathan Rosenberg and Alan Eagle Mr. Monkey and Me - Mike Smerklo
Recommended podcasts: Think like an Owner podcast - Alex Bridgeman Dynasty Leadership podcast - Todd Eberhardt Entrepreneurship Through Acquisition - Brian O'Connor
Todd Eberhardt CEO Coach Dynasty Leadership Consulting Minneapolis, MN [redacted] [redacted]