Why You Should Not Tie Earn-Out to Performance
How many franchises does it take to topple a person over? For Tina Tower--it was anything more than 20.
Once Australia’s youngest female franchisee, Tina’s booming success licensing her innovative children’s tutoring and education centres led to an Australian-wide network of privately owned offices and stores. True to the old adage “be careful what you wish for”, Tina’s intention to scale her business so that she could spend more time as a Mum both worked--and backfired.
With over 100 employees, 35 locations, and a number of franchisors committed to knocking down her door, Tina shares the hard lessons learned from scaling and growing a franchise so quickly. Fully believing that all of her lessons hard learned have come full circle through the online coaching business she leads today, Tina doesn’t regret the decision to start her tutoring company--or sell.
Sharing the thoughts that crossed her mind while free from her empire and travelling across the globe, Tina gives us a glimpse into how she began to navigate the next stage of her young life--after all, she sold her franchise empire at the age of 33.
Quite simply one of the hardest working Mums I know, I got the chance to talk to Tina about the grit and steel needed by every franchisee, how to stay connected to your true passion when your company scales, and the pros and cons of travelling with kids worldwide.
What you will learn in this episode
In this episode we’ll cover everything from:
- How having children at the age of 24 put a stopper in the way Tina had done business--and how it led her to scaling through a franchising and licensing model.
- The problems that every franchisee faces in the course of business--and why you need a heart of gold and a spine of steel.
- One of the core things that Tina learned through franchising--and why it’s something she will never undertake again.
- Tina’s advice if you’re thinking about signing an earn-out--imagine the worst case scenario. (Even the things you think no one could possibly do!)
- The one thing Tina would prioritise if she were to exit all over again. (Hint: don’t tie your buyout or earnings to anything performance related.)
About Our Guest
Tina Tower
Starting her first business at the age of 20, an enterprise that went from being a small suburban tutoring centre and educational toy store, to becoming a licence program, and then a franchise. After five years of franchising, Tina Tower opened 35 Begin Bright centres across Australia that employed 120 staff.
After Begin Bright was acquired by an international education company in 2016, Tina started coaching other people on how to scale their service-based businesses. When she found herself repeating a lot of the same fundamentals again and again to people who were paying top dollar for private coaching, she decided to put the repetitive content into an online course. It went off!
To put location freedom to the test, Tina set off to travel the world for a year with her husband and two children, visiting 28 countries, and all while growing the online business in a couple of hours a day.
Since returning from travel her empire has continued to grow and it’s been a revelation to her that this ‘little’ online business she runs from home, with just a couple of staff, makes far more money and has such a greater and wider impact than her franchise company ever did.
Tina has helped hundreds of people package their expertise into an online course and launched it to the world. Through her program, Her Empire Builder, she is on a mission to help 100 women build a $1 million a year business by 2025.
Tina is the author of two books, One Life: How To Have The Life of Your Dreams and Million Dollar Micro Business. She has also won some cool awards like Telstra National Young Business Woman of the Year Award and Australian Business Champion, and has been featured on the Today Show, in the Financial Review, on Sky Business and as a Business Woman to watch by The Huffington Post.
Tina lives with her family in a small farm on the Australian East Coast and from there, helps people to develop and grow their online digital business empires.
Connect with Tina Tower
Website: https://www.tinatower.com/
Website: http://milliondollarmicrobusiness.com/
LinkedIn: https://www.linkedin.com/in/tina-tower-b28a5136/
Facebook: https://www.facebook.com/TinaTowerAu
Instagram: https://www.instagram.com/tina_tower/
Twitter: https://twitter.com/tina_tower
YouTube: https://www.youtube.com/channel/UC7go9J55muB2DlKLL5XO-vg
Show Notes
(1:50) How having children at the age of 24 put a stopper in the way she had done business--and how it led her to scaling through a franchising and licensing model.
(5:35) How the perfect (but too expensive) office location was financially supported--through a complementary educational toy storefront.
(11:05) Why bigger isn’t always better. Tina reflects on the moment she knew she didn’t have a handle on her 20+ locations anymore--and why selling her company owned locations was such a big mistake.
(14:00) How her mindset in business coaching and consulting business is 100% different from franchising--and the benefits of no one holding her responsible for their results.
(15:50) The problems that every franchisee faces in the course of business--and why you need a heart of gold and a spine of steel.
(18:35) One of the core things that she learned through franchising--and why it’s something she will never undertake again.
(22:55) Tina’s advice if you’re thinking about signing an earn-out--imagine the worst case scenario. (Even the things you think no one could possibly do!)
(27:35) A recap on her Jerry McGuire moment and how she left her business in a blaze of glory.
(29:18) The one thing Tina would prioritise if she were to exit all over again. (Hint: don’t tie your buyout or earnings to anything performance related.)
(32:40) Why the recommendation for franchisees to be gritty and steely is absolutely true.
(37:18) The worldwide trip Tina’s family went on after selling her business--and when her eldest son and husband wanted their normal life back.
(42:20) After selling her business at the age of 33, Tina reflected on being too young to retire--and the constant requests to be a coach. Now offering online courses helping entrepreneurs to build revenue and make an impact, Tina is focused on helping other business owners step away from trading hours for dollars.
