Be The Bank

011 - Passion + Strength

June 02, 2021 Justin Bogard & Super E Season 3 Episode 11
Be The Bank
011 - Passion + Strength
Show Notes Transcript

2 Wealth Show S3 Ep11 - Passion + Strength

On Episode 11, Justin and Elizabeth interview Morgan Ciani.

Key Takeaways:  

  1. Top Line vs. 108%
  2. Understanding Financials & "Healthy" Cashflow
  3. Partnering vs. Consulting

 Resources and links discussed  

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About the Hosts 

Justin Bogard – Note Investor specializing in performing Residential Real Estate Debt. He finds deals and acquires them for his own portfolio as well as educates investors while walking them through the process of owning a Real Estate Note!  

Super E – Real Estate Investor specializing in short-term rentals and the management of them. She connects investors with short-term tenants and manages everything in-between.

Connect with the Hosts: 

  • @2wealthshow – Facebook/Instagram 
  • @wealth_show - Twitter 
Justin Bogard:

welcome to the, 2 wealth show a show that shares how you can create real wealth for you and your family. I'm one of your hosts, Justin Bogard. And my co-host is Elizabeth Sickles, AKA super E. I am a real estate note investor specializing in performing residential real estate debt. I find the deals acquire them for my own portfolio, as well as educate investors will walking them through the process of owning a real estate note. My co-host super E a real estate investor specializing in short-term rentals and the management of them. She connects investors with short-term tenants and manages everything in between. Our show was sponsored by bright path notes and Elizabeth Maora. You can find out more information by visiting our websites at brightpathnotes.com and elizabethmaora.com. It is episode 11 of season 3. I got my good dear close personal friend, my cohost Elizabeth Maora Sickles, AKA super E how are you today?

Elizabeth Maora:

I'm doing well. I just got back from a vacation and conference, so it's great to see everybody again. It was in Florida at Miramar beach, so it's an hour and a half drive from the Pensacola airport.

Justin Bogard:

Okay. And this was a conference on real estate, vacation rentals, vacation rentals. What are those?

Elizabeth Maora:

So the 192 people, it was great cause it's a smaller conference. So that was, it was fantastic. Uh, we raised$205,000 for advocacy fund. Um, so, uh, you know, a lot of, a lot of good stuff going on and vacation.

Justin Bogard:

That's awesome. And you're advocating for legislation or

Elizabeth Maora:

That's correct. So just to give everybody an idea, um, just real quick in the, this was for Vermont for all over the U S but in the state of Florida, um, the hotel industry has 83 lobbyists and we have none, that's just the state of Florida. So, so it was really, it was a great event. Um, and how, how are you doing Mr. Bogard? Uh,

Justin Bogard:

I'm doing well. It seems like the pandemic has slowed down enough to where things are starting to get back to normal. Uh, myself, I've been to, I think, two live events already in the past couple of months and the real estate dynamic is getting interesting. People are definitely looking for ways to deploy capital and recapitalize. So it's, it's fun to reinvent what we do in the real estate note business. And so I'm sure we'll be discussing that in a later episode, but we have a more important things to discuss for today.

Elizabeth Maora:

We do, we have a very special guest, um, her name is Morgan Ciani. Did I say that right? Justin Ciani? I should, I should know this. Ciani Ciani, she's very Italian. Well, I'm not

Justin Bogard:

Going to show on camera now that you've butchered up. Her name.

Elizabeth Maora:

Morgan is an advisory now partner at cultivate advisors. And so we're going to talk about her role in helping small businesses succeed. So, Morgan, welcome to our show. Thank you guys. So I know Morgan, my friend in Cali, who's also a real estate investor, big time real estate investor. She also owns coffee shops hired Morgan last year specifically to help her in her coffee shop and just would not leave me alone until I also hired Morgan Morgan is worth her weight again. So she is a business advisor. And Morgan, do you want to tell our audience just a little bit about your background and why you are qualified to help us run our businesses better? Sure. Um, yeah, so I actually was in the fitness industry for about 20 years. Um, took a left turn going from, going into medicine and went into fitness, um, and w you know, through, through my career, um, organically, and then by plan grew it to several locations across the country from San Diego back to the east coast to New York.

Morgan Ciani:

Um, and within that, um, was able to run them, um, with managing operators, uh, create some licensed trademark programs that created some I'll air quote, passive revenue, because there's no such thing as real passive revenue, but, um, created some passive revenue. Um, and then from there, uh, successfully exited out of those locations, uh, sold them to, uh, the ma the operating managers, and then went into midsize companies to help them grow to second, third, fourth locations, um, within the fitness industry. And then the evolution started to happen where I went into the restaurant industry, uh, the retail, uh, the real estate space with developers. Um, and then, uh, now with cultivated visors, which we are industry agnostic. So we work with over 150 different types of industries.

Justin Bogard:

That's awesome. Morgan, what timeframe was this when you were, when, uh, for the fitness, um, companies that you were working with and cultivate?

Morgan Ciani:

Yeah, so, um, around 2006, 2005 is when I opened my first location. Um, it was very or static how it happened. Uh, I went from I'm from New York, uh, went to San Diego. I want to contract with the Navy, um, and created the land-based, uh, conditioning for Navy seal buds. Um, and then from that, as I was training and working through that program, uh, I just started getting clients. Um, and then I had too many clients to work in someone else's space, so I had to open my space. Um, and then from there, uh, created, like I said, these modules and these licensed programs, so that I could replicate the business, um, across, you know, multiple locations.

Justin Bogard:

That's awesome. What was it like going through the financial crisis for what you were doing?

Morgan Ciani:

Yes, that's a very good question. That's when the lights that I thought was going to be glamorous became not so glamorous. Um, you know, the good thing is, and this is where I think, um, you know, as a business owner and whatever, that, whatever that structure of scope is of being a business owner, right, is really understanding the financials and really understanding your cashflow and having a very healthy cashflow in the business. Um, you know, cause 2009 was, um, was tough. Uh, you know, I survived because I did have healthy cashflow. Um, I survived because I had a healthy product, uh, that was, you know, that wasn't me, that was actually a product and a service. Um, and I was lucky cause I was in really good locations. The the one location that I had to, uh, kind of sever was the, um, uh, Jersey city location, because it was where all the financial companies came for after nine 11. And so they, you know, that was the hardest hit. Um, and it was a good choice, you know, it was like, you figure out where you're bleeding money and you, you, you, you plugged that and you move on. Um, and so being able to pivot and make those decisions, which, which brings, you know, kind of what happened last year, right? Like the business owners that we work with, it was understanding like, okay, let's talk about cashflow, let's get that cashflow healthy, let's pivot, and now let's continue to grow.

Elizabeth Maora:

Awesome. And I will say too, it wasn't just because Nicole, I saw on the sidelines, how Nicole business Nicole's business grew for Morgan. And one of the things that was super helpful was that they do a two hour consult complimentary for folks. I mean, that's, that's how dedicated cultivate advisors is to the small businesses in the U S which is really phenomenal. Yeah. And during the pandemic, we, um, I, I, you know, I wish I had the exact number, but as a team, uh, we have 40 advisors. We dedicated like full time being able and being available to business owners, um, for those advising sessions, in order to help people get just a grasp on like Eid LL on PPP loans and, and all of those, uh, you know, things that were hard for people to navigate, because one, they were stressed too. They were, you know, trying to survive, uh, not thrive. They were just like, we're just trying to survive. And so, you know, the, the amount of hours that cultivate advisors and, and, and the advisors within cultivate dedicated was astronomical. Not only that, but it's also valuable and what was cool about Morgan, we had our session and I was like, well, I wasn't quite ready to pull the trigger. And then she actually, she checked up on me and it's not like you can tell it, it wasn't because it was a check the box. It was like, because she actually cares. So even though I wasn't a client, um, so that's a huge difference. Cause I've had coaches before I've had both personal coaches and business coaches. Um, and there's a clear difference with cultivate. And in that you mentioned that you guys are industry agnostic. So can you talk about some of the different industries that your clients are in or just cultivate as a whole? Sure, of course. Um, yeah, I mean, we're everywhere. Well, we're B2B B to C, right. And we're, we're pretty much a 50 50 split on that.

Morgan Ciani:

Um, and then in terms of actual industries, I mean, we have everything from, you know, like you mentioned coffee shops to, um, law firms to retail, to, um, dentists, to it, firms MSP. Um, I have a client that makes teeth, I mean, yeah, I know there, there, I mean, I've sat down with people I'm like, wow, this is a business. Okay. Let's talk about this. Um, you know, like websites that, you know, just generate ad space and, and I mean, it's incredible. Uh, and it, and, and the thing that has, um, that is, I think what sets us apart. Um, I mean, I think there are multiple things, but just talking on specific, the specific industry agnostic piece is we're not coming in to be the expert in the industry that, that that's, that's the business owner we're coming in to be the expert in business. And, and I can speak for myself as you know, w when I first opened my business, I was passionate about the thing, but I wasn't strong in all of the other parts of the business. Right. And I had to lean in and get support. And so that's where we come in. You know, people open a business because they're either passionate or they see an opportunity right now through this demand, I'm going to create, you know, I'm going to, I'm going to have the, the, the supply there. Um, and we come in and we go, okay, great. We're gonna let you lean in and become a partner with you in this business at non-equity, uh, to, to make sure that we're getting you to the vision that you have, whether it's the growth, whether it's the exit, whether it's just maintaining. Um, but we're gonna, we're going to provide that support where your joint is weak

Justin Bogard:

Morgan. What's the, I'm sure there's a lot of things that, uh, businesses, small businesses make mistakes on that, you know, are obvious to you. What are some of the common ones that you run into where you can go meet and you'll be like, okay, here's, here's a hole I can plug pretty quickly and help you a little bit and get on your way.

Morgan Ciani:

Yeah. I think it's truly the deep dive on financials. The financials is a huge, it's a huge piece. Um, it's, it's uncomfortable. Uh, you know, a lot of times for business owners, um, because maybe it's the thing that they're not great at. Um, it's uncomfortable to dive into the numbers and, and, and really get a clear understanding of where they are in terms of cash flow. Um, but that is truly the, the thing that I see the most success, uh, because the financials is like the hub, right? And this is kind of our methodology. We look at it as like a turbine engine, right. Uh, or a fan or whatever you want to look at. And the financials is the hub and it feeds the air to the propellors, right. So it feeds the air to sales. It feeds the air to marketing, which is all on that growth side of the business. And then we look at capacity, which is recruiting and leadership. And so in order to have all of those working, the financials has to be there. We have to know, you know, what's the end goal. Okay, great. Here's the end goal. Let's reverse engineer that back and let's look at, you know, okay. In a year, what does that mean over quarters? What does that mean monthly? What does that mean? Now? Let's break that down into KPIs and metrics and initiatives that are going to help you get there.

Justin Bogard:

Awesome. And for those just a reminder, your, uh, website is cultivateadvisors.com. And for those that are watching the video portion on this, on the right path and his YouTube channel or Elizabeth Maora's YouTube channel as well, you can see the websites listed on here. I just over Morgan's picture. Unfortunately, Morgan had a technical difficulty with the camera, so we can't get to see what she looks like or the background. Unfortunately, it happens, right.

Morgan Ciani:

It's, uh, it's nothing exciting. It's a white wall. I was in Florida, um, for the past couple of months, which would have been a much better background, but let's go back to Chicago and I'm just a white wall, your chance to say that you were

Justin Bogard:

In Rome and you're not going to do reception. You just, you know,

Elizabeth Maora:

Glamor the glamor life. Can you also, I just want to touch base on a couple of acronyms. So Morgan said earlier B to C and B to B, so that's business to consumer like coffee shops, and then they also do B to B, so business to business. Um, and it's really important because, you know, we have so many listeners that are there in all different types of businesses. And just the fact that you guys are so agnostic and can help businesses wherever they are, get to where they want to be is, is really huge. Yeah. And I think that's, um, you know, that's, that's a lot of times when I sit down with people for the first time, they're like, yeah, my business is just unique. It might be, uh, but, but the, the business portion of your business is not right. And, and, and I, and I've learned to kind of have a firm hand in that to say, like, I get it. And that's, you know, we're qualifying you as much as you're qualifying us because you have to be an expert in business. Otherwise it isn't going to be a good fit because we're not coming in as a consultant. We're not coming in as a, um, a service provider we're truly coming in to partner with a business owner to help them succeed in what their vision is. That's a huge, um, that's a huge distinction, I think, from what I've seen, what makes cultivate. So, um, you know, so successful. Yeah. I mean, I can definitely, I don't want, of course, I'm going to agree with that. Right. Cause I'm sitting here talking about cultivate advisors. I can agree with that because, you know, I, I, I was in the consulting world. Right. And I, and I was, um, you know, doing things for businesses as almost like a pseudo operator in the business with them. And it, there becomes a stop point for that, because that one thing is completed. Right. But then there's still all these other gaps that the business owner has. And that's, that's what really does separate us. Um, and, and, and what, uh, where we can say, you know, here's where we come in and partner rather than here's where we come in and consult everything is done bespoke to the business. And it's not like, Hey, here's a sales process. Try the sales process and let us know how it works.

Justin Bogard:

Big difference. Yeah. I like how you, you were, um, honing in on the fact that you're partnering with the business owner as opposed to, you know, consulting them. I think that's just an important distinction. So I'm glad you guys brought that up.

Morgan Ciani:

Yeah, absolutely. And that is a hundred percent a part of not only our language, but our culture. Um, and it's our culture internally as well. Um, you know, like I had mentioned, we have over 40 advisors and we lean into each other all the time. I mean, Elizabeth has, has been, uh, uh, privy to that as well. Like I've, I've brought advisers in that. I'm like, you know what, they're just really good at this thing and I'm going to let them move us faster.

Justin Bogard:

So w what does the, what does the process look like as far as, like, how often are you engaging with the business owner? Like, is this at the beginning, I assume there's a lot more conversations. And then as you, as you give homework assignments or help them in certain areas, I'm, there's a longer length of time to when you reach back out to them, is that what it looks like? It

Morgan Ciani:

Does not, no, we are, we are fully, um, partnered with the business and the business owner, um, and sometimes the team as well. Um, so it really does, it does depend on the business, the size of the team, the needs of the business, the, uh, the gaps that there are, uh, in the business. And so, but generally, like if I'm speaking in a general, uh, uh, way, um, we have two, two hour meetings a month, um, and in those meetings, uh, depending on the cadence and, and again, what the roadmap is, you know, it's generally, you know, financials is absolutely one of those meetings, uh, in, in the month where we deep dive on what happened, what has to happen, you know, where's the gap. Um, and then, uh, you know, there, then there's the strategy portion. And then, um, you know, whatever other propeller, right? Like the sales, the marketing, whatever right now is like, part of the initiatives is what we, we handle in, in the other a two hour meeting. Um, there's also soundboarding, which I think is a very valuable portion of, of the meeting time where, you know, and Elizabeth, I mean, I, I'm sure you can speak to this, uh, just in terms of like, you know, having to soundboard, uh, where a lot of solutions are created in the, in the, what happens in the day-to-day of the business. Right. Um, and then there are other times where, you know, a client may just say like, Hey, do you have a couple of minutes? I have a question and I need some time. And, and again, that's where we're not, you know, we're not billing on time where it's like, yeah, okay. That's going to cost you. It's like, yes, of course, I'm your partner. Here's, here's where I have some time does this work. And so, uh, that's, you know, that's the general scope. It's like two, two hour meetings, and then the availability, if you need something, you know, I'm obviously there for you or, or were obviously there for you. So

Justin Bogard:

You, you really have to sink your teeth in at the beginning to kind of get a landscape of like, okay, where were all these problems that, and then, you know, kind of start from there. I wasn't surprised when he said the financials were the number, one thing that you, uh, that you see that people are not, don't have a grasp on it. You know, I'm gonna throw myself in that category. Cause I, I learned that quickly as well.

Morgan Ciani:

Sure. Yeah. And, and, you know, part of our, our foundation is financials. And when we talk about, um, the financial health of a business, it's not just top line revenue, it's that bottom line, right? It's like top line revenue is ego, right. It's like, here's how much my business makes, but what's in your pocket. Right. That's, that's a healthy business, you know, are you, can, you are Wednesdays really stressful for you because it's payroll. So that shouldn't happen. Right. Um, and so when we look at the results that we've had, uh, as a firm with our clients, that's what we look at, you know, obviously sure. Are we growing top line? Yes, of course. Right. But are we growing bottom line and in, you know, and even in a pandemic year, we did both, uh, when we look at clients that we've had for a 12 month period of time, um, and in 2019, our average, our average growth and bottom line profit was 108%. And so w you know, we, we walk the walk and talk the talk. Nice.

Justin Bogard:

Can you expand, expand on that, the bottom line versus top one, 108% growth.

Morgan Ciani:

Yeah, totally. So, you know, that top line is like, you're, you know, the revenue your business is bringing in the profitability is what's left over after everything is paid out, what's left over, you know, with your, you know, loans with your payroll, with your fixed expenses, what's left over. And so that's where we say, okay, great. We're doing a, we're doing a good job because we're keeping businesses healthy that they have money left over to continue to grow the business or pay themselves, right. Or, or like reinvest or open a second location. Um, and you know, when we, if I'm sharing just like personal results, you know, through the pandemic, um, that was, that was the focus. And, you know, we, we have, uh, I have a client that, you know, I, over the pandemic year grew profitability by 10% year over year, which is huge. Yeah. I like the service industry,

Justin Bogard:

Like what you said about when you talk about top line revenue and people that are bragging maybe about, you know, yeah. I may do you have a million dollars in revenue? So I feel like I'm doing awesome, but if they have, you know,$900,000 and underlying things that they pay out, it's, you know, it doesn't seem like it's that profitable.

Morgan Ciani:

Absolutely. Yeah, absolutely.

Justin Bogard:

I'm sorry, we're going to talk at the same time.

Morgan Ciani:

Can you also talk about how many clients do you guys have nationwide right now? Yeah, so we have, um, we're actually north America, so including, uh, Canada, um, and then we have clients overseas as well. Um, uh, Barcelona, Spain, um, Australia, I mean, like all over um, but we have over 500 active clients, um, within our, within our community. Um, and part of, uh, another thing that sets us apart is we have a community for business owners. So we have a, um, a landing page for our clients that it's almost like, you know, if you look at it as like a, uh, cultivate LinkedIn, right, where business owners can connect with one another, they can network with one another. They can lean into one another for, um, you know, best practices. Uh, they can ask for referrals, um, as well as we do, um, monthly events. So we do a networking event, uh, one, one day, a week or one day a month. We do a CEO webinar, which is live with our CEO, Casey Clark, uh, that's one day a month. Um, and, uh, we do a two, it was one time a year live event. Uh, we're now doing it two times a year called catapult it's our conference where business owners come in and, and it's very outcome driven. Uh, so we do breakout sessions. We have keynote speakers, um, and basically also just give business owners high fives and let them take a day out of the business and work on the business rather than work in it and be stuck in the weeds. That was one of that has been one of the big things that Morgan has helped me with as well, because when, when you're in the business, that's all you're thinking about. Instead of working on the business, you can actually grow it. Um, you know, so it's just all those, all those little things make such a huge difference.

Justin Bogard:

Yeah, you're exactly right. We've talked about this before Elizabeth, you'll be in the business and you'll be grinding it out and you'll be looking down all of a sudden, you look up as two years later, you're like, I haven't really done that other things that I'm supposed to be doing as the, as the owner, as the CEO and, you know, figure out where I need to put my growth pattern, what it is. Um, what's my end game. Right. So, yeah, I'm sure that's a very common thing we're going, I was going to ask you real quick. Um, does it, does it, do you recommend, or does it matter if, uh, if a small business has just like a startup, like a very small solo preneur or like, how do you guys work with that, that level of an entrepreneur? Or is it more like, um, they have to have a little bit of proof of concept before you'll be able to work with them.

Morgan Ciani:

Yeah. So, um, when, yeah, when we look at and remember it's an industry expert, right. Um, and so when we're looking at an ideal client and, and that's a, that's a big part of our discovery process. It's two-fold right. It's or it's reciprocal, but the client should be vetting us as well as we want to make sure it's the right fit. Uh, not only for the client, but for cultivate, right, because it's an investment. And, um, so having like a, you know, a revenue range of, of 500 K, um, having, or having multiple employees, it just depends on the type of business. Sometimes a widget is more expensive than another, right. And so that, that can change that revenue mark. Um, and then, you know, I'll keep kind of repeating this industry, industry expertise. Those are, those are three really important, uh, qualifications. Um, and then, you know, through that pre advising session that Elizabeth mentioned there, isn't a deep dive and we do go through financials and we do go through some modeling to uncover, is this going to be a good investment? Is there going to be a return on investment, a good ROI for you making this decision? And, and in that free advising session, we do act fiduciary to determine this is, or is not a good decision.

Justin Bogard:

That's awesome. You guys do a lot of work. So I appreciate that.

Morgan Ciani:

Yeah, we do. And, and, and, you know, one thing I'll mention about our advisors is we have all been business owners. So we come from that entrepreneurship background. So, you know, we've all successfully owned and exited businesses. Um, so we, not only do we have the skill, but we have the empathy, uh, as business owners. Yeah, totally. Right. Like, you know, there's the transition curve, right. And, and everything. And it's, you know, that, that, um, no blind optimism to, oh my gosh, what am I doing to, I don't know if I want to do this anymore too. This is great. It's amazing. Right. It's and so we've been on that roller coaster, and I think that is also a, uh, you know, a really important piece of, of having that sound boarding and that, that, like I said, like empathetic, um, approach to advising.

Justin Bogard:

So again, Morgan's website is cultivateadvisors.com and I kind of have a one, one closing statement for you, and I'm sort of super, E's got, got a couple as well. And my question to you, Morgan, is if somebody decides they want to start a business, is there any kind of free advice that you would give them to, to say, here's, here's maybe some things you should focus on first before you jump into stuff? Because I know some people are just like, well, I need to market first. Well, now I need to build my product or, you know, or does it depend on the industry? Um,

Morgan Ciani:

Yeah, I would say that, you know, the the floor and, and, you know, coming and speaking real estate terms, right. The foundation has to be solid in order to start building accessory rooms across the floor. Um, and, and looking at it that way as like your financials, right. Do you have a five-year growth performance? Do you have a projection for the next five years? Um, do you have the ability to break that projection down year over year? Do you understand what the KPIs, the key performance indicators are that are going to help you get to that goal? The metrics that you're going to track to get to that goal? Um, and then, you know, just again, like, do you have a solid understanding of the industry so that you can actually drive the bus, um, to get to those numbers? Right. Great answer. Elizabeth, thank you so much for being on.

Elizabeth Maora:

Thank you all that. Not only you're doing, but also cultivate is doing for small businesses, which is the engine of America. So we appreciate you being on today and kind of helping our, our, um, all of our listeners, whether you're watching or you're listening, just know that, you know, there are people out here, no matter what area you're building your wealth. And if you're wanting to get to the point where you are building your real estate wealth, you know, Morgan and her team can definitely help you get there. Yeah, absolutely. And thank you for having me. Um, it's, it's, you know, I love to preach and evangelize cultivating of course. Right. Um, but it's, it is because it's something that I'm extremely passionate about. Um, and that's like, you know, we, we talk about this a lot in cultivate this, you know, what's your why?

Morgan Ciani:

Um, my, why is, you know, I was going into medicine because I wanted to help people. And, you know, I went into fitness because I wanted to help people. And I work with small business owners because I believe the same thing, Elizabeth, the entrepreneurship is the thread. Um, you know, that, that creates the economy, uh, in, in, in this country and to be able to help a small business that helps their community, that provides employment and that provides revenue. And it's so important to me. And so I thank you for having me on, because I do love to just kind of evangelize this, so

Justin Bogard:

We appreciate it. And you're welcome. Absolutely. Morgan, thank you so much for being on episode 11 of the 2 wealth show, season three, and I'm Justin Bogard with BrightPath notes.

Elizabeth Maora:

I'm Elizabeth with Elizabeth Maora. All right, until next time. See you guys. Thank you everybody. Bye bye.

Justin Bogard:

2 wealth show was produced by Justin Bogard and super E sponsored by Brightpath notes and Elizabeth, Maora. Thanks for listening and watching for our show.