https://youtu.be/_A__xfP6HBM

Laurie Barkman, strategic growth advisor, former $100M CEO, M&A expert, and author of The Business Transition Handbook, helps construction, architecture, and engineering firms build scalable, sustainable businesses that create time, freedom, and long-term value. Having experienced a major acquisition firsthand and led companies through significant growth and change, Laurie now focuses on helping mature business owners navigate the complex journey of building enterprise value and preparing for future transitions.

We explore Laurie’s BUILT Method—Blueprint, Unlock, Integrate, Lead, Transition—a strategic framework designed to help founders of established businesses scale beyond owner dependency and prepare for successful leadership or ownership transitions. Laurie explains how aligning the owner’s personal vision with the company’s future strategy creates clarity, why measuring enterprise value can unlock new growth decisions, and how proactive transition planning helps entrepreneurs avoid the identity crisis that often follows a business exit.

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Take 5 Steps to Transitioning Your Business with Laurie Barkman

Good day, dear listeners. Steve Preda here, the Founder of the Summit OS Group, and today my guest is Laurie Barkman, a strategic growth advisor, former a hundred-million-dollar CEO and M&A expert who’s helping construction and engineering companies build scalable, sustainable businesses that creates time, freedom, and value. Laurie is also the author of the Business Transition Handbook. Laurie, welcome to the show.

Steve, thank you so much. I’m so excited to be with you today.

Yeah, it’s great to have you. And you have a really interesting niche with the business transition and helping construction or architecture engineering firms. So what brought you to this point? What is your personal why, and how are you manifesting it in your practice?

My personal why has been evolving over the years through my career. I think I was always an entrepreneur at heart. I had orbited entrepreneurial companies, like startups, in a big company. I was always the maverick. I was trying to be an intrapreneur and ultimately found myself in a position of finding a way to help business owners in the back part of their journey.

While I love startups, I have found that my niche is in working with mature companies—so companies that are over five to seven years old—and helping entrepreneurs in the tough decisions.
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It’s the tough decisions that they really wrestle with, feel alone, and I’ve been in executive shoes, right? I’ve been lived that world. I’m living in the entrepreneurial world right now, but again, in this mature space where we think about life differently, we think about transitions differently, and I’ve just kind of embraced that idea, especially as a Gen Xer, of how to help other Gen Xers in that in-between.

So is there like a personal reason why you are attracted to this whole idea of the transition?

I’ve lived a lot of transitions, especially in the corporate world, going through an acquisition about 10 years ago, I was an outside hire at a third-generation company, and they said, “We’re looking to hire you not for the next three years, but for the next 20,” which was really exciting, but it ended up being three.

And the reason why is because a little Bluebird, who wasn’t so little, a global company who was very in acquisitive, I was interested in this business, third-generation company. It was over a billion in revenue. My business unit was about 10% of the total. So again, sizable business unit, and myself and the other executives had to work really, really hard to keep our foot on the gas pedal, making sure that the deal, if we were, was going to go through that we helped make it go through—which we did.

It was out of the blue. The company was not on the market. But I saw firsthand the innovation, the growth, and the transition over the three generations of the stories of how it went from one to the next was just so fascinating to me. So when I ultimately was part of the integration team, I left the business. The short answer was that I was just there for three years.

And so after that I really saw an opportunity to help other entrepreneurs on their journey. So this notion of that we’re going to grow, we’re going to innovate, and then eventually we’re going to transition—maybe it’s a family business, maybe it’s founder-led. Nonetheless,

we want to create value, we want to have good handoffs, and I saw things were working well.
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As I mentioned, I joined at the point of the third generation. Then it was up to the corporate gods take it from there. And so

I thought about ways to add value and work with inspired entrepreneurs who envision a future legacy for themselves, the people they love, the communities they serve
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but they’re just stuck. They feel stuck in some way. They’re kind of on their path. They’re not at the end of the path. They’re on it, and they need that support. That’s really what’s been motivating me and driving me for the last seven plus years.

Yeah. That’s a wonderful journey, and it’s a very wordy thing because these entrepreneurs, they build a company, and then they don’t know how to allow it to grow up. And you basically are there and help them with the empty nesting and the pre-empty nesting, getting them into good courage. That’s also very important. So one of the ways you, I understand you do this is you call it the BUILT Method, which is kind of neat because you work with construction, engineering, architecture firms. So what is the BUILD Method is about, and how does it help people?

Yeah,

the BUILD Method is definitely an acknowledgement that we are in a physical world, and I appreciate you making that connection.
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And it’s not lost on our audience, hopefully. It’s such an important space. We really, in a time of AI and such dramatic change, the built environment of architecture, engineering, design companies that are envisioning their futures. There’s like any industry, there’s a lot of changes. And so this is a blueprint, if you will. That’s the “B,” right? It’s a blueprint for what is your vision and what is the firm model, what should it be in the future? It’s really that roadmap of future growth. The “U” is an unlocked. So many of us feel stuck.

Maybe we’re stuck in the day-to-day because we have owner-dependent businesses. Maybe we feel stuck because our revenues are plateaued or declining. And we see ourselves as a bottleneck. Maybe we’re a bottleneck for a variety of reasons, which I’m sure we could talk about. The “I” is all about integration. And so, what do we need to do to document our systems and put things in place so that we don’t have risks in terms of not only owner dependency, but any other employees where there could be gaps should someone leave the organization or have some other untimely departure? The “L” is lead, and lead is not used lightly.

Lead is really with clarity and not with chaos. And for owner-dependent businesses, people that have companies that can’t thrive without them, this tends to be a real challenge that they want to lead from the front, but they’re not.

And they're so in the weeds in the business, they can't see the forest for the trees. They're not working on the business. So really helping my clients find that clarity is so important.
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And then the “T”, last but not least, stands for transition. It’s probably my favorite word at this point. And it’s not just transition or change for any sake. It’s good to have that confidence and to be in control, to be in the driver’s seat, and to be proactive about change.

It’s why I wrote the book, The Business Transition Handbook. It’s really encouraging entrepreneurs to not think about an exit as a point in time and a finite point in time. It’s why I do talk about exit and I do talk about exit planning, but my recognition is that this is a finite action, and a transition is a journey.

It's a path, and that's why my business is named Business Transition Sherpa, because I am with you on your journey. So the BUILT Method is really all about these different aspects and helping entrepreneurs on their journey.
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STEVE PREDA: Yeah. This is very cool. And there is a lifecycle to business, and there’s a lifecycle to an entrepreneur as well. And hopefully the business’s lifecycle is much longer than the entrepreneur’s. So someone is going to take it on, and you want to create a great legacy and a great business. So your way of the blueprint or your version of blueprint is different. Is it like what people call mission, vision, values kind of thing or there’s more to it?

I think it does start with that. I mean, those are so fundamental, and my overall approach with strategic transition planning is the acknowledgement that there’s different aspects of the planning that we need to do as business owners, and one of those aspects is a blueprint for the business.

And the business fundamentals of where do we want to be in five to seven years or ten years. Another part of that, which is a dovetail, is where does the owner want to be? What’s their personal future vision? And we start to intertwine those things, especially in this age and life stage. I work a lot with, as I mentioned, Gen Xers, and so we are in the mid-fifties of our lives, and statistically speaking, we’re about five to seven years away from a significant life transition. A lot of the Gen Xers, especially business owners I work with, are saying, “I’m looking ahead. I see what the baby boomers have done, and I don’t want to do it their way. I want to do it differently. I’m not going to die at my desk, and I want other things out of my life. My business has provided this and that for me, which has been valuable, but I’m ready for something different. I just don’t know what it is.”

So we integrate in this blueprint. Their vision is not just for the business, but it's for themselves as well. And it's a big reason why I work directly one-on-one with the owners, founders.
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You and I have talked offline about the role of management team. It’s so important for me. It’s really, really important to give that private time and private space for the owner because these are such important questions that will influence the direction of many lives. And if we’re unwavering, it feels a little uncertain, and we don’t want to necessarily showcase that uncertainty to our teams.

So the blueprint part of this is a bit of ideation as well. A big part of what we do is we work on what their future vision is, and it takes into account this age and life stage component of what we’ve been talking about.

Yeah. That’s really interesting because maybe you find that as well, that sometimes the vision—the individual vision of the entrepreneur and the company’s vision gets confused. And the entrepreneur may not realizing that their vision may be to transition out of the company, but that’s not going to be the vision for the company because the company for them to be able to transition, has to have a much longer view and people have to believe in it, so that even with the founder, they’re going to be successful. So that is an interesting conundrum that I vision for with an entrepreneur like that. Do you find that to be the case?

It is a conundrum. I think it’s just a lonely place in our heads and for owners and founders who have a lot on their shoulders. “Heavy is the head that wears the crown,” right? It’s a saying that means so much. I think that people want to explore options. They don’t want to lock in on something and put all their eggs in that one basket. I have found that owners who create options for eventual transition are better positioned than folks who have placed bets. I could tell you so many stories, Steve.

So for example, especially in our engineering, architecture, and design-type of audience, owners sometimes are placing bets on their internal management to buy them out over time. I had one gentleman call me—I’d say he’s a baby boomer. He had a wonderful number two, had been grooming the number two for eventual. What he had envisioned in his mind was of to sell the business to him, and not only did the number two not want that; he resigned. And it felt like such a betrayal. He was so upset. I had talked to him months after this happened, and he was still upset about it. He felt like it was a starting over in a lot of ways for his own exit plan, which it was.

And so we try to prevent against that. Yeah,

there's a lot of things that we can do to try to figure out if we have the right people in the right seats. And that's important.
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I know you spent a lot of time on this as well, working with management to say, “Do we have the right people in the right seats?” And we do assessments, and those are great. Those are skills and strengths, and we should do that. But what I have found is that we don’t do that when it comes to ownership, especially if we think that the owner is inside the company. And we can talk about it—I’ve created an assessment for that because it’s a high-level way to just get your head around.

Do people on my team have an ownership mentality or not? We’re not recruiting for that. We’re recruiting for the skills and strengths that we need for that time. And when we’re growing people over a long period of time, you can imagine how that becomes even more of a problem because if we assume they’re an owner, they have a owner mindset, and they don’t—and they’re more cash—oriented versus equity—oriented and other things—that puts us in a trap.

Yeah. I think it’s a big trap. I read it somewhere, I know where I read it from. Dan Kennedy, who’s like a small business guru—he was big in the 2000s—and he once said that the worst number in business is one. It’s one salesperson; it’s one successor who will have to come through.

I think this is a big mistake of business owners that they try to clone themselves because they think that if they just find one person who is going to be as good as me, and all my problems are solved. Whether you call it an integrator who is going to come in and run the show and I can just be up there and vision and dream about stuff, I think it’s a huge mistake. I much prefer the idea of creating mini-CEOs in your business who can really strategically own their functions. So anyhow, yeah, this is a big problem. But I’d like to move on to the next letter in the acronym, which is “U”. I really love this word: “unlock.” It’s very inspiring. Unlock—how do you unlock? How do you figure out how to open up the floodgates of opportunity or whatever you mean by unlock?

I think part of it is a diagnostic around where is the business today and what are some of the things that we’ve set as goals for enterprise value. What is enterprise value? Are we measuring it? Most often we’re not, and the one big unlock is just this recognition that we have set KPIs for our business, which are great, and we’re using them with our teams, and we’re operationalizing those. Love it. Awesome. Keep that going. But what a business owner is not measuring most often is the enterprise value.

And if we are measuring that, we might make different choices in how we’re investing our resources if our objective is to increase that value. So we might say, “Well, what is enterprise value?” Okay. So we need to understand that. And then, what is it in measurement terms—either through a professional like myself who can help us understand and not just talking to your buddies at the golf club or what you think your business might be worth? And if we can really get some data around that. You know,

I love my analytical entrepreneurs, which is one of the reasons I love this space. They're analytical people, and they like the numbers, and they want to have some structure around it. So that's what we do, is we start with the baselining.
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Where is the business today? And let’s set some targets. We look at, “Well, what’s best in class in that particular industry?” So again, the AEC industry, we have some benchmarks around that. And then we have to understand, “Well, what are some of the value drivers?” One big, big value driver, of course, is going to be financial performance.

So what’s beyond that? And what are these hidden things that we don’t know that can be detracting value? And so if we dig into those things, it’s like an unlock. And once you see it, you can’t unsee it. My best example of that in this conversation is enterprise value. Once you know where your enterprise value is today, you can’t unsee that. And you also can’t unsee the desire for many people, which is, “Oh wow, what if I could increase that?” Then we’re talking about millions of dollars of value at some point in the future. So aligning that with our exercise we talked about earlier, which is our age and life-stage exercise around exit timeline.

It’s so powerful because now we can set some targets that are meaningful to our communities, our employees, our stakeholders, and ourselves, and aligning the personal, the business, and the financial towards this overall picture. It’s a major unlock.

And do you find that—what is the level of transparency you see that these business owners allow for their team to see? So would they actually show them that this is our profitability, these are our margins, gross profit, this is our overhead, this is our net profit, this is how we calculate enterprise value, and here is how you can help me improve it. Is this how it goes or it’s more everyone is just focusing on a couple of KPIs that are within their program?

It’s an evolution. I think a lot of times in the beginning, we keep it a little close because we’re trying to understand it ourselves. And for firms that have developed a cost-of-goods-sold model, a gross profit, they’re already measuring that. Maybe they’re doing that by lines of business. That is really powerful. I have one client in the engineering space that just put that in. And they doubled revenue last year, by the way. So they’re a high-growth company in the engineering space, which is so exciting. They’re doing about $10 million in revenue, and they just put that in for the different lines of business.

And how it’s helping them is it’s giving them a year-over-year perspective, which is good. They can see where they’re investing, and they can also see payback opportunities where there’s an intersection with the team.

I think is on the business side for growth levers. When we talk about value drivers, and we'll just pick one that's quite common beyond financial numbers, it's our ability to drive recurring revenue, subscription models, and different flavors of…
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So for this particular client, we’ve been working on developing a recurring revenue program for them, and we’re at the starting line, but what’s going to be so exciting, I think, not only in terms of their core business growth that they’re seeing, but once we get that recurring revenue program up and running, it’s going to be material. Once the revenues are large enough, of course, it’s going to be material on their enterprise value. And so the dovetail is, well, yeah, he’s not going to launch the subscription revenue business by himself. He needs others to help him do that. But the idea for it and the vision for it and then the unlock right, comes from this type of exploration.

Yeah. Wow. That’s great. And it is definitely a challenge that construction companies often struggle with. How do I do a project-based company primarily? How do I drive recurring revenue, subscription models? That would probably deserve its own podcast, this whole topic or maybe a podcast series. Maybe I’ll talk about it another time. I still like us to cover the last letter in the acronym: the transition. Because that’s where I see a lot of people who have sold their business. I was an investment banker in my past life, and I don’t know how many times we saw the business, and the owner was so excited that they basically neutralized the risk, and then they had this big pile of cash, and they bought the boat and they bought the car and the house.

And six months later, the boat was collecting water in the marina. You know, they showed the car off to everyone, and it was no longer exciting, but it was very expensive, and they didn’t know where to store it, kind of thing. And then they were getting bored, and they were kind of disappointed because their identity got ahead. How do you deal with it? How do you help people with the identity issue and this whole thinking about transition the right way?

You nailed it. That identity is a really big part of why many business owners feel lonely and a bit depressed one year after a sale. There’s many reasons why that could happen. I think the statistics are a little bit over the place, but I do believe that identity is a big part of it. And so if we are working on this together, an example with one of my clients is I gave them a book to read because I got an inkling of what he was interested in, which is themes around justice.

And he’s seeking ways to have an impact in his community that are truly outside the business for lots of reasons. But he just innately wants this type of involvement, and we are going through an exploration of what that could look like. He’s in a good place with his business.

We're continuing to grow it, and we're working on his growth and enterprise value growth and things like that.
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But this sort of sits on this in a parallel path, and it will intersect at some point because we all are human. We have an age and life stage to us, and how he’s envisioning spending his time over the next 10 years. He wants to continue to have a path forward. But we’ve created a space for when we meet, we’re meeting one-on-one, we create that space to really talk about how does he want to spend his time outside the business. And note the timeline here. He’s about 10 years away. And to his credit, he’s saying, “Yeah, I want to start doing something now.” And if that’s how we can think about it, Steve. I think it’s really important. It’s almost like this giant on-ramp. We’re not going to just sell our business and then, all of a sudden we’re going to go have this amazing thing that we’re going to create tomorrow, right? It just takes time. And another way to think about it is like a portfolio—a portfolio of how you look at your identity, how you feel about yourself, and how you spend your time—and has to align. Really, it can align with your core values, it can align with how you want to spend time with people you love.

So I have one client, engineering company owner, who is very committed to the church that they support, and he spends a lot of time and a lot of resources. It’s very clear on the company’s website how the company has a policy of donating proceeds from profits to this entity. So it’s well known, and it’s just part of their culture. And in developing his 10-year view, this is part and parcel of it. It’s involving his family members; it’s involving the company. It’s helped fueling a decision around their transition path. They’ve considered lots of different options: Should they sell to a third party? Should they become an ESOP? And the dovetail, I think, for many, is to figure out what is that right fit based on what’s important to you. What’s going to give you that feeling of that completeness and balance that you’re seeking?

Wow, that’s amazing. You have people who are thinking about that 10-years out. That is impressive. I’ve never seen that. If a business owner thinks 3-years out about that, it’s already much better than average. So you obviously are inculcating them with the right kind of ideas. So tell me about your business. So let’s switch gears here a little bit. I mean, you ran this a hundred million dollar business for three years, and it got sold; it got integrated. So I’m sure that you had some big challenges there. What is it that you would consider the hardest decision you ever had to make in your business?

Yeah, I think in today’s world, I can try to put my coaching hat on for this answer. I’m trying to build a practice that is creating value for others. And so one big thing is to make sure that I’m doing that now with my client relationships and how we measure things. I’m confident that we are doing that, but inherently, if we have one voice, how do we reach many?

And I think a lot of companies… it’s like, “Oh, that’s a marketing question.” Yes. And right, it is a marketing question. There’s a lot of things that are dynamically changing in our world. How do we reach the people that we want to reach? How do we share a message? So that is no matter what business you have, I think we can all sort of empathize with that.

So I do feel like that is changing a lot. So the challenge is, how do I meet people where they are, right? I think podcasting has been a great vehicle. We’re doing more of that. We’re going to be doing more in-person things as well. I do think that we’re very much in a powerful digital age, and the more digital tools we’re putting in front of us and the more digital time we’re spending.

My hypothesis, Steve, is that the value of the interaction—the one-on-one as well as group—is not lost on anybody. That it’s going to be even, probably even more important. And especially as things, and if you’re reading some of these AI articles about potential impact in our economy, there’s going to be a lot of need for us to come together, and lean on each other’s shoulders, and be good, solid resources for one another in times of dramatic change.

I fully agree with you. I have that feeling as well that there’s so much alienation that is being caused by the digital stuff, and AI in particular, that people are replacing conversations with chatGPT conversations. I think people will just realize that this is all unreal, or we don’t know whether it’s real or not real. And there’s so much noise because everyone is creating all these posts with AI, and you know what is a real voice here? You won’t know unless you meet the person in person and then you hear their own voice and provided they’re not a robot because that can also happen that you have humanoid robots, but let’s not go that far.

So I do agree, and I think that your personal recommendations are going to be even more powerful in the future because you don’t know what is real and what is fake. People also starve. We sit in front of our Zoom screens, and it’s not the same as meeting someone in person. There is a different quality to it, and we are going to starve for it. I was just thinking this morning that I looked at my calendar, and I’m just coming out of my season of spending days with my entrepreneur clients, and it’s over. And next couple months, it’s going to be pretty quiet. I’m going to be in my office, and I’m dreading having to sit here on my own. So I’m thinking about, “Okay, I have to get out there. I have to meet people.” So I’m recording video on this one. Last question. Well, penultimate question to you is, what do you think is the most important question that an entrepreneur should be asking themselves?

I’m going to come back to kind of this AI conversation. I think every CEO needs to be using ai. And I think every CEO needs to be considering how their teams can use it and not put your head in sand. I think there’s a lot of impact, positive impact that can be had by just some basic productivity improvements, which is kind of how 95% of AI is being used today. There’s nothing wrong with that. And then from there can lead us to coming up with ways to enhance our business. I have one client that’s using it for proposal development.

It’s been a dramatic improvement in quality and time, and that’s just one case study example, but there’s so many others. Following’s. Okay. You don’t have to be a leader. And just being recognizing that AI is going to touch so many aspects of our business and personal lives. And then the other thing is like, don’t stop hiring people because of AI either.

There’s a lot of doomsday articles coming out now about the economy and impact of AI. There may be some scary truth to some of those things. And then I’m seeing articles from folks saying, “Look, AI shouldn’t take over your entire business. You’re still going to need smart people. You just want to give them the tools.”

As an example, there’s a friend of mine who runs a digital marketing agency, and you might think, “Oh, that’s the kind of business that’s shrinking.” Well, they’re over 200 people, and they’re using AI in very efficient and effective ways. So it’s not a recipe to just dial back your human capital. It’s a recipe to do the unlock and do the think about how you can best use this information to create a scalable practice.

Yeah, I think so. Also, this has been seen in history that since the Industrial Revolution, everyone was afraid of losing jobs. And the more technology there is, the more ideas there are for further services, the more demand there is because all the value is being created, and we want to spend that value on more stuff, right? And yeah, I agree that AI is just raising the bar. So every company has to now be AI-empowered and do a lot more. We can’t just deliver what we were delivering a year ago. We have to deliver more, which means that those people who are AI-enabled, they’ll just have to raise their standard.

Yeah, I agree with you. So if people would like to learn more about let’s say they have an AEC-type of company—architectural, engineering, construction. Did I get it right?

Yes.

And they are thinking about the future and the transition and build the blueprint for a great company that has more enterprise value, et cetera, or they read your book and they realize that this is exactly what they need. How can they find you and how can they connect to you?

Well, my website’s probably a great place to go, which is btsherpa.com. And if people are interested in that succession assessment that I mentioned earlier, just put slash succession—so btsherpa.com/succession—and you’ll get access to the assessment. You can take it multiple times for different people in mind as well. And so my book is on there, my podcast, and I really do hope that people follow up with me. If you have any questions at all about anything we talked about today.

Fantastic. So do check out Laurie Barkman via btsherpa.com/succession if you want to read the materials and download stuff. Thank you, Laurie, for sharing all your great ideas and insights. If you enjoyed the conversation, then stay tuned because every week I bring an exciting entrepreneur, thought leader to the show who will share with you about frameworks about growing your business and making it more valuable. So thanks, Laurie, for coming, and thanks for listening.

Important Links:

323: Take 5 Steps to Transitioning Your Business with Laurie Barkman

Management Blueprint | Steve Preda

323: Take 5 Steps to Transitioning Your Business with Laurie Barkman