Master the process of identifying acquisition opportunities and preparing a business for sale with Jim Lindstrom’s insights.
Weekly Pilot Briefing
In this week's Built-to-Sell podcast, Jim Lindstrom does an excellent job of walking us through his journey of buying, building, improving, systematizing, and selling BuzzWord, a company that specializes in ESG reporting.
I always enjoy hearing about an owner’s educational process and journey in preparing their business for sale. In this case, Jim acted on both sides of the transaction: first determining if BuzzWord would be a good company to purchase and then working diligently to position it in such a way to secure the highest valuation when he was ready to sell it years later.
Through this retelling, we encounter a number of the concepts that the Value Builder System utilizes to assist owners in maximizing the value of their company (i.e. financial performance, growth potential, the valuation teeter-totter, recurring revenue, and hub and spoke).
If you want to learn more about the eight key drivers that affect the value of your company, please feel free to get your Value Builder Score here: https://www.flightplanstrategies.com/value-builder-score or you can schedule some time with us using our Calendly link at the top right of the page.
Finally, a couple of noteworthy sections you may want to check out are timestamped below:
6:00 – Telling a good story in your Confidential Information Memorandum (CIM). Loyal clients and loyal employees.
10:45 – The effective use of contractors vs. employees.
15:00 – “Optimizing Your Business For Freedom”
20:00 – Profit-Sharing Mindset and Strategies
28:00 – Incentivizing Middle Management
32:30 – Understanding your expected multiple (and the difference between <$1M vs >$1M revenue companies)
About this Episode
In this episode of Built to Sell Radio, Jim Lindstrom discusses how he acquired BuzzWord, a company specializing in ESG (Environmental, Social, and Governance) reporting. Lindstrom explains how he built a killer culture by transforming contractors into full-time employees and incentivizing them with a two-part profit-sharing scheme focused on cash flow and EBITDA, setting the business up for future sale.
Here’s what you’ll discover how to:
Identify acquisition opportunities and assess their growth potential
Retain key talent and transition contractors into long-term employees
Implement an innovative two-part profit-sharing plan that incentivizes both cash flow and EBITDA
Build a business to position it for a profitable sale
Manage the risks and rewards of relying on contractor-based teams
Lindstrom’s experience highlights the strategy behind buying, building, and how to sell your Business!
About our Guest

Jim Lindstrom
Jim Lindstrom, a seasoned CEO with experience in leading companies like IES, Providence Service Corp and Verdian. The discussion covers his experiences with accelerating company growth, executing turnarounds, managing balance sheets, and strategic value creation. Jim shares insights on governance, operations, capital allocation, team alignment, and business simplification, drawing from his extensive experience in various leadership roles.
Definitions
Due-Diligence: This is a comprehensive appraisal of a business or investment undertaken before a merger, acquisition, or investment. It seeks to validate the information provided and uncover any potential risks or liabilities.
Earn-out: This is a financing arrangement for the purchase of a business, where the seller must meet certain performance goals before receiving the full purchase price. It reduces the buyer’s risk and aligns the interests of both parties post-acquisition.
Employer Net Promoter Score (eNPS): This metric assesses employee loyalty by measuring the willingness of employees to recommend their workplace to others. It’s an indication of employee satisfaction and organizational health.
Sellers Discretionary Earnings (SDE): This represents the earnings of a business before the owner’s salary, interest, taxes, depreciation, and amortization. It’s used to assess the true earning potential of a small business. Imagine you have a lemonade stand. At the end of the day, you count how much money you made. But from this money, you need to pay for the lemons, sugar, cups, etc. What you have left after paying for these things is similar to what businesses call “profit.”
However, if you paid yourself a small amount for your time running the lemonade stand, or maybe you bought a new sign to attract more customers, those are costs that are specific to you as the owner and are considered “discretionary.” They are costs that a new owner might not have or might choose to spend differently.
So, Seller’s Discretionary Earnings (SDE) in business terms is like the money left from the lemonade stand, plus any extra costs or payments that were specific to the current owner. It’s a way to show how much money a new owner might expect to earn from the business, considering they might have different ways of running things. In simpler terms, it’s a measure of a business’s earning power from the viewpoint of the owner.
Whether you want to sell your business now or decades in the future, getting your Value Builder Score will allow you to:
Diagnose what may be holding you back from creating a company that can fully thrive without you.
See how an acquirer would evaluate your business, enabling you to focus today on what will be important down the road.
Identify hidden things that may quietly drag down the value of your business so you can eliminate them before they become a problem.
Join 70,000+ business owners and click the link below to get your complimentary Value Builder Score.
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