Episode 9: Blaine Bertsch – How To Avoid And Cure Cash Flow Challenges

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Gold Nuggets

  1. Businesses need to understand where they’re going, understand their numbers, keep an eye on things, and get help from pros like you guys, that is how you can thrive long-term and how you can make decisions that make sense.
  2. Growth is one of the most dangerous times for a business, extreme growth, especially, because you have to have capital there. You have to be able to build. You have to be able to grow, and it can be honestly out of control, and businesses can run out of cash so quickly.
  3. 70% of businesses, well over half, that fail were profitable when they went out of business.
  4. Every business needs to know the length of its runway – the amount of time until they run out of cash.
  5. When it comes to cash flow knowing is always better than not knowing because not knowing is not going to save your business.

Meet Blaine Bertsch

Our guest is Blaine Bertsch, the co-founder and CEO of Dryrun, which is a cash flow management software, he’s also the author of the book, The Pandemic Cash Flow, a book designed to help people understand the concept of cash flow, but, more importantly, perhaps how to avoid the pitfalls and the challenges of managing cash flow.

Smart Man, Smarter Woman References

We talk about a lot in each episode; however, we don’t want you to miss a thing! Here are some key items were mentioned if you want to take a closer look.

Book Recommendation
The Pandemic Cash Flow


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Steve Loates (00:00):
Welcome to Smart Man, Smarter Woman, a podcast by entrepreneurs for entrepreneurs to help them grow and succeed. Thank you, everyone, for joining us today. I’m Steve Loates.

Juliet Aurora (00:14):
I’m Juliet Aurora.

Steve Loates (00:16):
We are your co-hosts, and we really are excited today. We have a great show for you with a very special guest to talk about a challenge for many entrepreneurs. Blaine Bertsch, the co-founder and CEO of Dryrun, which is a cash flow management software, he’s also the author of the book, The Pandemic Cash Flow, a book designed to help people understand the concept of cash flow, but, more importantly, perhaps how to avoid the pitfalls and the challenges of managing cash flow, but before I officially introduce Blaine, let’s hear from my wonderful co-host, the smarter woman herself, Juliet.

Juliet Aurora (01:02):
Hey, everyone. Nice to have you all join us today. I’m looking forward to today’s episode, only because we encounter small businesses all the time that are struggling with cash flow. I’ve not met Blaine personally, but know several members of his team, and the way that they’re able to break down the concept of cash flow has been amazing. I think we’re going to have a great conversation. Welcome, Blaine.

Blaine Bertsch (01:27):
Thank you very much. Great to be here.

Steve Loates (01:29):
Now, as I mentioned at the beginning of our podcast, it is for and about entrepreneurs and the challenges that they face. Our goal with each episode is hopefully to provide some entertainment, but, most importantly, some value for you, the listener, some insights, hopefully some gold nuggets that can help other entrepreneurs no matter where they are on their own journey. Without further ado, let’s bring our guest into the show, Blaine. Welcome, Blaine, and thank you very much for joining us. How are you doing in these crazy, unusual times?

Blaine Bertsch (02:13):
We’re doing good. My full team was already remote, so were already hitting the ground running on the remote front, and, of course, as you mentioned, cash flow is such a massive issue for businesses right now. We’re helping as many businesses as we can. We’ve had quite a big pickup in our signups and a lot of activity going on, and we’re doing everything we can to make sure that people understand the ins and outs of cash flow and that we’re doing as much education as we can alongside of, of course, the product and helping them get onboarded and work their way through.

Steve Loates (02:53):
Terrific, terrific. Well, before we actually get into the product itself, the actual cash flow topic, and also I’d like to talk a little bit your book, as well, which, by the way, I’ve read, I enjoyed it, thought it was a great book. I like the fact that it’s written in a way that the vast majority of entrepreneurs will be able to understand it, which is, I think, important when you write a book. Why don’t we start off by perhaps you sharing a little bit about our own entrepreneurial journey, where it began and maybe even why the topic of cash flow became so important to you.

Blaine Bertsch (03:39):
Sure. I guess I was started out as an entrepreneur back in ’99, dating myself here. We’re over 20 years now, I guess. I started my first business in ’99. I had a creative agency. It grew from me, myself, and a laptop up to a small team and a bigger office, and I always say that we credit cash flow as being a big driver for us. That’s what drives me. That’s what drives our team, helping businesses with their cash flow. That started for me around 2008, and I always credit 2008-2009, the recession, with me getting a really good handle on cash flow. At the time, we had did all the colossal errors, I think, in a lot of ways that businesses often go through. We had expanded. We got a really big office we were going to grow into. We’d leased a couple fancy sports cars. We were traveling all over the world, figuring we were going to get the next big international deal, the whole works, and then, suddenly, we started hearing this rumbling of a recession, and we thought it hit overnight.

Blaine Bertsch (04:53):
This, that we’re going through right now, this hit overnight, but it felt like that back in 2008, but it was quite a quick slowdown. It seemed to hit really quite quickly. Suddenly, all these jobs we had in progress, the brakes slammed on virtually all of them. Our market was 70% government at the time, and they shut right down. We had to do a transition to a completely new market, into that corporate market, and it was a real challenge, and then we found out really quickly how little we knew about our business. We’d just been flying by the seat of our pants.

Blaine Bertsch (05:34):
That’s when I dug in. I pulled out spreadsheets. I started to do some really basic, what’s our fixed cost? What else do we have going on, what’s our revenue look like, building up cash for the forecast, and then it’s like pulling on a string, and you start saying, “Okay. Well, now, what’s making us money? What’s our sales pipeline six months look like? What’s profitable?” We reformed the business, and it was all suddenly informed by this data.

Blaine Bertsch (06:02):
I’ll tell you the one thing that I probably mentioned above that still drives me a little nuts is I realized how much money we had left on the table outside of all this cash flow stuff. Understanding suddenly how broken our systems were and how much money we left on the table because we just weren’t paying attention to things and weren’t spending the money at the right times on the right things and running into capacity issues and lack of profitability was a real eye opener. When I sold the business in 2012, I decided this is what I’m going to take on is this cash flow problem that I really struggled with.

Steve Loates (06:40):
That’s great. It’s fascinating to me talking to different entrepreneurs how often the catalyst for what they do today was either a situation they went through previously or a problem that they needed a solution for, the solution wasn’t there, so I’m going to invent the solution. It sounds very much like you went through that path and realized that perhaps there should be maybe a better way of managing it than what you had done originally, and so I’m assuming that that was the birth of Dryrun, your current company.

Blaine Bertsch (07:27):
It absolutely was. It wasn’t an overnight birth, but it was just after I sold my last business, I started thinking, “What am I going to do now?” It kept coming back to this cash flow issue, and then I sat down with, I always say, about 50 cups of coffee as I sat down with all these different entrepreneurs and just asked them, “How did you guys get through this, and how did you manage?” Almost to a person, it was, “I either did it by the seat of my pants and still do, or I used spreadsheets, and it was just painful every step of the way.” That’s when I started to realize, and I started looking, even in the midst of all this, I couldn’t find a tool, and I couldn’t find any real guidance. You search on Google for cash flow, and there’s all kinds of stuff out there, but I couldn’t find anything that actually gave any sort of operational advice. They’ll say, “Well, do a forecast.” How do you do that? I had no idea at the time.

Blaine Bertsch (08:25):
That’s really also where the book came from that released in 2018, aptly titled I suppose today, but it was about giving entrepreneurs just a really, from the ground floor up, a concrete this is how cash flow works, this is how you can actually set up a forecast to just start getting moving on things because it was something I couldn’t find. Everyone knows how big of an issue it is. Didn’t seem like anyone was actually up for tackling it.

Juliet Aurora (08:56):
What I found interesting, as you were telling your story, was how you said that when business was good, you weren’t worried about it, but it was when the recession started in 2008 that you actually started paying attention to it, and then realized how much money you were leaving on the table. I just highlight that because most businesses, that is the format that they go through where they don’t pay attention to any of their numbers when they have enough money in the bank and that they are able to pay their bills and give themselves the lifestyle that they want, but in order for your business to survive times like this, you do have to know what’s going on when your business is doing well. I thought that was a great point I just wanted to pull out of your conversation.

Blaine Bertsch (09:51):
Well, I think coming out of this, businesses are going to be digging themselves out right now for years. Even if we weren’t in this situation that is so volatile and so drastic, it’s just a tool in a tool belt for a business owner. Businesses are likely going to be pushed to a fundamental change that we’ve been sort of preaching about anyways, that understanding where you’re going, understanding those numbers, keeping an eye on things, and getting help from pros like you guys, to do that is how you can thrive long-term and how you can make decisions that make sense.

Blaine Bertsch (10:21):
I go back to before, 2006-2007, when things were flying high and we had all kinds of work coming in, and that didn’t mean that there weren’t times where … I always talk about the lonely walk to the mailbox hoping a check came in so I could make payroll because we always had money owed us, but getting it in sometimes was so painful and so difficult. Even during the high times, there are times I’d be throwing a little personal cash to get us over a week, and then we’d have a bunch of money in the bank, we’d be like, “Oh, well, let’s buy some new computers and a new HD camera,” and all the stuff that made sense at the time, not really knowing that, or I forgot, we had committed to this, and we wrote a check for this contractor, and all of a sudden, you’re right back where you’re at. It’s this up and down volatility that just is constant.

Blaine Bertsch (11:13):
There’s a fairly straightforward way out of this. This is not hours and hours and hours a week for an average company and engaging pros like you guys. They can have their cake and eat it, too, because they can know exactly what’s happening in their business, making those decisions. They don’t have to spend days on this every week.

Juliet Aurora (11:31):

Steve Loates (11:33):
One of the things that I enjoyed in the book was you talk about some of the different reasons of why it’s important to manage your cash flow. I know, for many businesses, they think that you only ever run into cash flow problems because business is down or business drys up, but that’s not the case at all. Business can be good. You can look at your sales and have good revenue and no cash. You can have tremendous growth in your business, and you look at all these opportunities coming up on the horizon, and you don’t have any money in the bank to pay the rent. Can we perhaps touch on some of those different things that you talk about, as to some of the different scenarios that small business and entrepreneurs need to really be aware of when it comes to cash flow management? It isn’t just because business is slowing down.

Blaine Bertsch (12:43):
No, and growth is one of the most dangerous times for a business, extreme growth, especially, because you have to have capital there. You have to be able to build. You have to be able to grow, and it can be really honestly out of control, and businesses can run out of cash so quickly.

Blaine Bertsch (13:00):
One of the stats I have in the book, and it’s one that I go back to a lot, is 70% of businesses that fail were profitable when they went out of business, and it sounds like such a shocking stat-

Steve Loates (13:13):
Sorry. Sorry to interrupt you. Can you say that again, Blaine? That is a mind-blowing statistic, I think, for most small business owners. I’d just like you to say that again.

Blaine Bertsch (13:25):
Yeah. 70% of businesses, well over half, that die, that fail were profitable when they went out of business. They weren’t getting the money in. It does. It sounds mind-blowing, but I’ll tell you, we talk with businesses every single day. They come in, and we’re onboarding, we’re talking with them all the time, and it is not mind-blowing for us because almost everyone that comes in the door, they start telling us their issues with their business and the challenges they have, and, so often, it seems like they think it’s unique, and they’re like, “I don’t know how we got in this jam. We’re growing, but we can’t get this money in, and we’re running …” I talked with a business not too long ago, and they ended up basically bringing in an investor that essentially bought the business 10 cents on a dollar, and they were wildly profitable, but they could not get the money to come in to fund the next job, to fund the next job, to fund the growth, and they literally were days away from dying with a business that you’re looking and go, “Man, this profit margin, people would die for.”

Blaine Bertsch (14:33):
That’s the problem because there’s a difference between receivables and signed contracts and cash in the bank. It’s just you can’t survive without cash in the bank. You can’t make it. We hear from every corner of the globe, seems like every sector imaginable, stories like this where they can’t get the tap turned on fast enough, they can’t get the money flowing in, or they’ve got commitments that on paper everything looks good, but they can’t get the timing right, and a lot of businesses don’t survive. They don’t survive through it, but understanding where you’re headed and be able to look at it … The more time you have, the more options you have.

Blaine Bertsch (15:23):
I don’t know if I actually have in this book or not. You guys tell me if it sounds familiar, but I use this example to people all the time. If you step off the curb in front of a bus, if that bus is 10 feet away, you’re going to get run over. If the bus is two blocks down the road, you can turn, you can see the bus and say, “Well, okay, I’m going to go back on the curb and get across the road. I’m going to wave him down.” There’s all of these other options, and it’s very similar with cash flow. If you understand when you may have a shortfall, you can build a plan around it. If you go to your bank and you say, “Hey, we’re going to have a shortfall six weeks out, but look it here. This is what our sales pipeline looks like, and I’ve got this all mapped out,” they’ll say, “Okay. That sounds pretty good.” If you go to your bank and say, “We’re out of cash on Friday,” they’re going to show you the door. You’re just proving you’re high risk.

Blaine Bertsch (16:13):
Having these forecasts, whether it’s a real time of volatility or having them there just as helping you grow and helping you manage that next step, is critical, and every business, there’s going to be times when it’s volatile and critical and times when it’s just really good management.

Juliet Aurora (16:37):
Hopefully, everyone is understanding how important it is to know what your cash flow forecast is going to look like. Can you give them an idea as to what your recommendation is to how far out they should be looking, or is it industry-dependent or business-dependent?

Blaine Bertsch (16:56):
Yeah, it is a bit nuanced like that. We usually say have a minimum three-month forecast, but there’s businesses that I know that come to us, they’re in daily view in Dryrun, they’re looking at it daily, and it’s such an issue of timing on … They got to buy inventory, and they have to get cash moving out over here, and it’s just a big puzzle. There’s other businesses where it’s more of they’ve got a lot of receivables out there. They’re floating out there. A bunch are over 90 days overdue. They’re stretching out longer. Then, there’s businesses that are looking out over a year and actually building sales pipelines into Dryrun, as well. They’re got their near-term cash flow, and they’re also looking at their sales. That’s critical. We’ve told many entrepreneurs, “If you’re short today, there’s a good chance you had a broken sales pipeline six months ago,” because, depending on the type of business you do, some of it’s walking off the streets and people are buying.

Blaine Bertsch (17:54):
My last business, a lot of the deals that we had would take six months to a year, sometimes well over a year, to close a deal, and the bigger the deal, the longer it was to close it. You have to be able to have that visibility further out and have an idea, what’s in the books, what are we potentially going to land, and when we land that, how are we going to build out a payment system, a payment terms basically that actually makes sense for our business?

Blaine Bertsch (18:23):
There’s a lot of nuance. For a business just to dive in initially, it’s not difficult. You can basically look at your fixed cost that you have working through your business every month. This is how much I need every month to keep my business open. Here’s some of our variable costs, that we better pay attention to the bills that are sitting on your desk, and your revenue. What is that looking like? Who owes you money? How’s that looking?

Blaine Bertsch (18:50):
Right now, with so many businesses in a really difficult time, number one is runway. How long till I run out of money because they’re probably not profitable right now. They probably don’t have, or even if they don’t have profit, they just don’t have enough revenue, and it’s just slowly burning away their reserves.

Blaine Bertsch (19:11):
That’s a bit of a tricky question, and we see businesses come in all the time where basically just get started today. We often say, “This week, this month, this year, and where are you in that? What is the biggest problem in your business?” but, as a baseline, it’s like, “Let’s look at this month. Let’s look in the next three months and start growing from there.

Juliet Aurora (19:32):
Great. Can you just recap for us? You’ve mentioned a whole bunch of reasons why the cash flow is important. Maybe it might be helpful to just recap it, what the top reasons are. One of them is to be able to predict if you’re going to have a shortfall, whether that’s two months down the … You’re two blocks away from the bus as opposed to 10 feet from the bus. That’s your first reason. I like the way you phrased that where you have runway, where you can determine when you’re going to run out of cash, especially in times like this. Can you just recap some of the other main reasons that someone, as a business, needs to be tracking their cash flow?

Blaine Bertsch (20:14):
Yeah. One of the biggest ones is timing issues. You’re owed a bunch of money. You’ve got a bunch of invoices out there. There was a study I read a couple years ago that the average construction company in Alberta is owed over 260,000 90 days overdue always. They’re always out that much cash that’s that overdue. That’s just the cost of doing business for them.

Blaine Bertsch (20:38):
You have a lot of money floating out there. If you’re a type of business that sends out invoices, oftentimes, you’re overdue, and they’re timing issues because you can have payables sitting on your desk. You’re going to have those costs of your payroll and your rent and everything else, but the ones that often catch businesses are the big tax bill that’s sitting on your desk, buying inventory, paying that contractor. Understanding the timing and knowing ahead of time when you may be short on money means, hey, let’s not put some money out on this item quite yet. Right now, let’s get on the phone and talk with our suppliers, let’s talk with our clients, and get a really realistic picture of when money will come in and when you might have to delay payment.

Blaine Bertsch (21:25):
Timing issues are always really key for businesses, for businesses that have that regular revenue coming in every day, like the coffee shop business basically, though, a lot of times, it’s big dollars going out. They have to buy their supplies, their inventory, and they need to basically keep track of when do I need to have money to pay that payroll, when do I need to pay for this inventory, am I going to have enough money, a few issues there.

Blaine Bertsch (21:53):
Something that’s a bit tricky right now, I did mention burn rate or, sorry, runway, basically how long till you run out of cash. The other term that is usually more of a startup business term, but is effecting almost every business today that’s really affected by the current crisis is burn rate and how much money, which is related to your runway, basically how much in the red are you every month, and can you reduce that burn rate? If it costs 100,000 to be in business every month with all of your expenses and with whatever you’ve got working right now, you can pull in 70,000 a month, you’re burning through 30,000 a month. That’s when you start looking at, how do we reduce that? How do we get that closer to at least breaking even, but still somehow serve our customers so that we can have that money coming in? Very tricky, but reducing that burn rate, extending that runway may just help you scrape through as you see the different programs that are coming online, and, as business opens up, how quickly it starts to rebound.

Blaine Bertsch (22:58):
There’s a lot of things that businesses have to look at right now and model out and best case, worst case, what if we have to shut down again? What if we start growing even faster because there’s this backlog? A lot of things that businesses have to look at right now.

Juliet Aurora (23:11):
Perfect. Thanks so much for recapping that. There was so much information there, I wanted to make sure that we highlighted why it’s important. Thank you.

Steve Loates (23:21):
That was great. I guess one thing I’d like to touch on a little if we could is we talked a little bit about how to avoid getting into the situation, and, obviously, planning is always the number one thing, but what if you’re already in it, you’ve already got a cash flow problem? What advice can you give to those entrepreneurs when they’re not sleeping at night, panic is setting in? It becomes very difficult to think logically about, “How am I going to get out of this?” Is there any advice you could share with someone who is in that situation right now?

Blaine Bertsch (24:16):
Yeah, absolutely. The number one thing is knowing is better than not knowing. In fact, I saw a quote earlier today, paraphrasing, I might have it wrong, but, “Not knowing is not going to save you.” I don’t know if I have that quite right. [inaudible 00:24:32], but it’s the idea that … because we’ve talked to the business owners that literally have told us, “I’m scared to know. I don’t want to know. I don’t want to know.” That’s not going to save you. That’s probably what the quote is. I should have looked it up before I spit it out there. We hear that a lot, and it is important to know. It seems a lot more scary until you actually know where you’re at because, once you know where you’re at, you can start to look at your options, and the fact is some businesses that we’ve talked with, their option is, I’m closing, but the decision is made sooner, and the decision is made before they burn through even more money and get into even worse shape, but, that, I think, is a bit of an exception.

Blaine Bertsch (25:21):
Most the businesses we talk to, when they actually get control of their numbers, they understand where they’re going, they’re looking at the different best and worst case scenarios. That’s where they’re finding the answer. That’s where they’re finding their way out. That’s where they can go and talk to their bank or investors, as different programs come out from the province and from the federal government. They can map that out and say, “Okay, where this reduces our burn rate,” and you get to that. It’s different now than it was, even three months ago. The conversations we had three months ago were generally much simpler, much more straightforward, and, now, it’s just such a difficult time and it’s so volatile, but looking at your numbers and understanding them and knowing them, I think, will actually put your mind at ease no matter what sort of situation you’re in, but that’s where you’re going to find your way out.

Blaine Bertsch (26:13):
In fact, we did have a business that, literally, their accountant was actually tasked with building out some scenarios. They sat down in a meeting because they were going to sit down and decide how we’re going to shut this down. How do we do that? They modeled all that out, and when they actually saw the data on the screen, and, Barbara, our director of client success was telling us about this, they said they mapped it out, put it on the screen, and the owners literally looked and went, “Wait a minute. This isn’t as bad as we thought. This here, if we can get enough money to get over this bump, we’re good to go,” and the actually literally saved their business by just looking at the data and understanding it. All the information was there in their business, but without being able to visualize it and actually look at it and understand it, it wasn’t even an option for them.

Blaine Bertsch (27:08):
It feels hard. I know businesses right now, as things are opening up, they’re pulled in 50 different directions. It doesn’t take you days to set this up. In fact, we can likely help you get a basic forecast set up in an hour, not even an hour, and get some clarity, and then you have this foundation that you can go back to every few days or every week, whenever you need to, to look at and just pull a little lever here, pull a little lever there in a matter of minutes and understand how you might find your way forward, understand some of the variables.

Juliet Aurora (27:37):
Well, I think that’s a great example, as well, when, as Steve said, somebody is in the thick of it, then where should they start, is if they’re in the thick of it, they’re probably not sleeping at night because they’re imagining every possible worst case scenario. How am I going to tell my staff that I have to lay everybody off? What am I going to do with my time? They’re playing all these worst case scenarios in their head, whereas, in your example, it wasn’t actually as bad as they imagined. Knowing it and understanding it may also be a better place than just imaging the worst case because that’s where your mind tends to-

Blaine Bertsch (28:18):
Well, a friend of mine, I just was on a call with them a couple of weeks ago, and he’s got quite a bigger business, and, basically, he modeled out what their business looked like, what their revenue looked like, understood exactly where they’re headed, what their runway was, what everything looked like. What that allowed him to do was walk into a meeting with all the staff, sit down, and say, “This is where we’re going. This is where we’re going to get to right now. We need to try and get to here to survive. We need to get further.” This was really on before a lot of these government programs came out. He did this quite early, reacted quite early, because he saw what was happening, and he just went to his staff and he said, “Look, we’re going to go with COVID pay.” He goes, “That way, we can keep you guys here. You’re going to make more than if you’re on EI. The guys at the top are getting the biggest cut, and if we do this, we can survive longer.”

Blaine Bertsch (29:18):
That’s a hard conversation to have, but when he could actually show them, this is where we’re going and this is why we have to do this, he got a ton of buy-in because nobody wanted to leave. They wanted to keep going. He actually outlines it in an article online. He actually outlined actually in an interview with me, as well, how he basically used COVID pay to keep his staff and move forward.

Blaine Bertsch (29:42):
It’s hard to make decisions like that in the dark. You need those numbers. You need that data. For entrepreneurs, it’s so complicated, all this stuff with the current crisis, but I don’t want to make it sound like it’s so complicated to get a handle on this. Each business really just has a few fundamentals that they have to look at. Doesn’t have to be the same as the next business and the next one. Getting in and building up a forecast can be really simple. It doesn’t take that long, and it’s just that foundation that you can keep forward and keep going and have informed conversations with you guys. Being able to have informed conversations with their advisors is so critical, and going in and saying, “I don’t know what’s going on,” is not an effective use of time or money. Being able to go in and have an informed conversation where you can talk back and forth and look at the options is really, really important, and no time has ever been more important than now.

Juliet Aurora (30:44):
I think that another point to highlight that you’ve said is that it doesn’t need to be complicated. Even if you build a really, really simple model, just looking even at bigger items, it’s still going to give you some insight that you can build on. You got your foundation now, and you can add the depth to it and add the detail to it over time. You don’t have to start out with 100 lines on your cash flow forecast.

Blaine Bertsch (31:09):
Exactly. We’ve had customers come in, and a lot of them want to detail all their fixed costs, all that recurring expenses that happen every month, and it is helpful to have some detail there because, as they’re trying to go, “Okay, what if we remove this or do this, that,” but, literally, some businesses come in, they know, it’s going to cost me 150 grand to be and business this month. Stick that down, repeat one line, three seconds, and it’s in your forecast because the stuff that they’re dealing with is more the revenue side. You don’t have to make this perfect forecast. It’s just you need the information that you need, and we say all the time, “Don’t over-complicate it. Keep it as simple as you can for what you need to know, and it’ll grow over time if you need more detail.”

Steve Loates (31:57):
Great, great, great advice. I’d like to switch gears just a little here and just talk about your book for a few moments. I guess my first question has to be, did you know something we didn’t know when you gave this book the title you gave it, Pandemic Cash Flow?

Blaine Bertsch (32:18):
No. That was a strange coincidence, but when we saw how this pandemic, of course, a healthcare pandemic, has gone across the globe and affected every country and how severe it is, and that’s, honestly, when I wrote the book, and we’re sitting down and talking with the team and we’re looking a this and going, “This is what’s happening. We’ve got users today in 70-something countries. This is a global problem. Cash flow affects businesses across the globe. 30% of businesses die within five years because of cash flow. Like we mentioned, so many of them were profitable on paper when they died. This is a really, really severe issue. People that aren’t entrepreneurs don’t really understand how dangerous it is and how few businesses actually survive to their fifth birthday. It’s a really difficult time, and so much of it could be remedied.

Blaine Bertsch (33:18):
Now, there’s times where businesses I know, they open up, they got a bad idea, bad location, they’re not going to make it through. The ones that concern us are the ones that, like I said, they were profitable, they do have demand. Their businesses that should not be going out of business, and it’s, oftentimes, just an issue with more of a management, a systems.

Blaine Bertsch (33:43):
Going back to my last business, one of the things that we learned by looking at our data and looking at our numbers and looking at our sales process and everything, moving forward, one of the most important things we did was negotiated much harder and not necessarily on the price, on the payment terms, and we came up with really inventive payment terms to make sure that we had cash coming through the door, and we figured out fairly soon when is the best time to negotiate, how to work it in, what sort of arguments and phrases that our customers likely would say, “Yeah, that makes sense from our side, too, to make sure that we got money coming in.” We never did that before because it never really occurred to us, but once we saw in black and white this is what’s going on, it became fundamental to us to know all those things, to go in and negotiate them and get those terms to take away as much risk as possible.

Blaine Bertsch (34:42):
It’s difficult for businesses. Like I said, it’s global. It affects almost every single business, and even the ones that are flesh with cash likely could keep even having more in their pocket and grow faster if they really knew where they were headed.

Steve Loates (34:59):
Absolutely. How did you enjoy the journey of actually writing the book?

Blaine Bertsch (35:06):
That was long. That was long and difficult. Running a business and writing a lot on a lot of coffee shops on the weekends and just grinding through, and, at some point, you just have to say, “We’re setting it loose into the wild.” It was funny. After we set it loose into the wild, and then a few months later, a friend of mine, he said, “I’m pretty good at picking out typos and things like that.” He sent me back a copy, and he had something written on every page. I went through it and edit it. I’m like, “This guy is the best editor I’ve ever seen.” Anyway, I ended up having to go through, tweak it all, and put it back out there because, at some point, you’re just like, “This has to get out the door, and we’ve got to get back to running a business here.” I enjoyed it, but it was a real slog to do it, as well.

Steve Loates (35:53):
Absolutely. Juliet and I are great admirers of anyone who has written a book. I know when we wrote ours, at the beginning, we were excited, we were gung ho, we had all these things we wanted to say, and then you get to around chapter seven or eight, and it’s, “Oh, my God. We still got some things we got to say here,” but, like you said, we still want to have a life, we still have a business we’re trying to run, but we told everyone, “We’re going to write this book,” so we have to finish it. It’s great credit to you and congratulations on the book. It’s great.

Blaine Bertsch (36:34):
Oh, well, thank you, thank you. Appreciate that.

Steve Loates (36:37):
That brings us to the part of the show, one of my favorite parts. I know I’m dating myself here, but if any of you remember James Lipton in the Actors Studio TV show and one of the things he used to do with all of his guests was ask them a series of questions at the end of the interview, and every guest was asked the same questions, and I always told myself, “If I ever was fortunate enough to be in that situation, I wanted to do the same thing because he used to get some very interesting answers,” and I must say we’ve also now had some pretty interesting answers to some of these questions. If you’re ready, Blaine, I’d like to get started with the questions.

Blaine Bertsch (37:35):
Sure. Hopefully, I’ll have an answer for them.

Steve Loates (37:38):
Absolutely, you will. You’ll be great. The first question, what one word best defines an entrepreneur?

Blaine Bertsch (37:49):

Steve Loates (37:52):
What profession, other than your own, would you like to attempt?

Blaine Bertsch (37:59):
Whoa, like to attempt or wish I had?

Steve Loates (38:03):
Like to attempt.

Blaine Bertsch (38:05):
Wish I had would have been rock band, I think, but, oh, that’s a good question. I’m a designer by trade. I guess in a commercial side, I make skateboards now on the-

Steve Loates (38:20):
Oh, wow.

Blaine Bertsch (38:21):
… on the side for fun. That would have been kind of a fun actual business to do is to actually build skateboards as a profession, not as a weekend stress relief hobby, I suppose.

Steve Loates (38:35):
Great. We have not had that answer before, I can tell you.

Juliet Aurora (38:37):
We have not.

Steve Loates (38:38):
What profession would you not like to have tried?

Blaine Bertsch (38:45):
That’s interesting, not like to have tried. It’s tough to answer, if not having tried it. I had some jobs I wasn’t too fond of during university. I wasn’t very good at something that was just a repetitive task. I did construction. I did some painting, house painting, things like that in my university days, and I think I found that I needed my brain working all the time, and when felt like it was just sort of a repetitive task, I couldn’t do that as a job, but as a stress relief of building things on the weekend and that, it’s great stress relief because it’s not the main driver, I suppose.

Steve Loates (39:32):
Great. Next question, what sound or noise do you love?

Blaine Bertsch (39:39):
I love music. I listen to music. As soon as I get off of here, the music will be on. I love music. I listen to it all obsessively.

Steve Loates (39:53):
Very good. What book would you recommend that all entrepreneurs should read other than Pandemic Cash Flow?

Blaine Bertsch (40:04):
Other than my own, I think The E Myth is a terrific book. I read that so long ago, and I probably read it three or four times since then, terrific book, but you know what? I’m going to go back to before I even started my business, right before I started my first business. I remember I had a job. The only time I’ve worked for someone for the first maybe two or three years after university, I worked for someone, and I had to go in and negotiate a raise, and I didn’t know what I was doing, and I had the weekend. They said, “Come in on Monday, and we’ll talk about it.” I went home, and I went over to the bookstore because, then, you couldn’t just get them online, and I got two books, and one was What They Don’t Teach You in Harvard Business School About Negotiation, paraphrasing the name. It’s on my bookshelf here, but I can’t remember the exact title. The other one was The Harvard Business School Guide to Negotiation. I thought, “Well, I’m going to read both sides of the story here.”

Blaine Bertsch (41:02):
I read those books cover-to-cover. I went into that meeting Monday morning, and scared walking in and walked out with a grin on my face and like, “I learned a lot from those books.” I tell you, those negotiation skills have been essential through my entire career, and they’re just concrete skills, but, at times, I know I even drive my staff nuts because they’ll be looking at something and I’m pushing to negotiate for everything. It drives them nuts sometimes, but it’s a really important fundamental skill for business owners, and it’s one that can be learned and practiced.

Steve Loates (41:43):
Great. The last question, when your own entrepreneurial journey is completed, what do you hope your legacy is?

Blaine Bertsch (41:55):
Well, I’m so passionate about entrepreneurship and the challenges that businesses face, and having been an entrepreneur for so long and gone through some of those really difficult times, that’s what we’re all about today, and I can’t see doing anything else, even after Dryrun. I’m going to be doing something to help entrepreneurs, and that’s the key for me is helping the people in the end. It’s not about trying to help big business make more money. It’s about helping people that take up the challenge, take up the battle, survive and thrive, and hopefully we cut down on some of those percentages of businesses that fail every year.

Steve Loates (42:39):
Excellent, excellent. Before we leave, if any of our listeners want to connect with you, what is the best way for them to do that? I’m also going to spell your name just so everybody knows it. It is Blaine, B-L-A-I-N-E, and hopefully I’m pronouncing the last name correctly, Bertsch. Am I even close?

Blaine Bertsch (43:04):
That’s exactly right, yep.

Steve Loates (43:05):
Perfect. B-E-R-T-S-C-H. What’s the best way for people to connect with you?

Blaine Bertsch (43:12):
Best way is just you can email me, Blaine@Dryrun.com. You can visit us at Dryrun.com. There’s a little chat bubble right on the site if you want to … Now, if you send a message through chat, it’ll go to someone else directly, but they can get hold of me. You can just say, “Hey, can you send this to Blaine or whatever.” Real easy to get hold of. You can find me on LinkedIn, as well.

Steve Loates (43:35):
Perfect, perfect. Well, that’s great. One of the things I am, for those that know me or are getting to know me, I am referred to as a quote nerd. I am a lover of quotes. I have a collection of them. We always like to finish off every episode with a quote, and I thought this was be appropriate for today’s episode. The quote is from Peter Drucker. “What gets measured gets managed.” I think that applies.

Blaine Bertsch (44:13):

Steve Loates (44:14):
Thank you very much. We really appreciate you joining us, Blaine, and giving up your time, and lots and lots of great and valuable information. Thank you very much for that.

Juliet Aurora (44:27):
Thank you.

Steve Loates (44:28):
Thank you, Ju, for always being my awesome co-host. Most importantly, thank you to you, the audience, for tuning in, for giving us a listen, and we sincerely hope you found some value today. If you did, please subscribe. You can find us in all the usual places, iTunes, Spotify, Google. You can visit our website, smartmansmarterwoman.com. Thank you very much. Until next time, take good care of yourself and those you love. See you again.

Song by Adam Vitovsky / CC BY 3.0

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Episode 9