Acquiring Minds Podcast: "Rebuilding from 80% Collapse to Mid-7 Figures Revenue" Summary

Release Date: May 22, 2025

In this compelling episode of "Acquiring Minds," host Will Smith interviews Scott Alexander, the resilient entrepreneur behind Gyrus Marketing. Scott's journey from acquiring a struggling marketing agency, navigating deceit and sabotage, to transforming it into a thriving mid seven-figure business offers invaluable insights for acquisition entrepreneurs.

1. The Decision to Buy a Business

Scott Alexander, a seasoned intrapreneur with a background in healthcare organizations like Medtronic and Mercy, shares his motivations for venturing into acquisition entrepreneurship. In his late 30s, encouraged by his supportive wife Jodi, Scott decided to buy an existing business to gain more control over his career and lifestyle.

[04:50] Scott Alexander: "I had always had this inkling of wanting to start and run my own business... it's been a roller coaster, but it's been a journey for sure."

Scott emphasizes the desire for stability and immediate revenue streams that acquisition offers compared to the uncertainties of starting from scratch.

2. Finding the Right Acquisition Target

Utilizing an aggregator tool called X5, Scott quickly identified a suitable marketing agency in Denver specializing in lead generation for chiropractors and dentists. The business, with about 20 employees and annual revenues around $750K, appeared promising with steady growth and multiple recurring revenue streams.

[19:50] Scott Alexander: "We saw a business that met all our criteria... a marketing firm based in Denver serving the chiropractor dental space."

Scott's careful selection was based on industry specialization and recurring revenue models, which he believed would provide a solid foundation for growth.

3. The Transaction and Initial Red Flags

During due diligence, Scott and Jodi conducted extensive evaluations, including consulting projects with the seller, interviewing employees, and analyzing client feedback. Despite positive interactions and alignment in faith and values, subtle red flags emerged.

[34:15] Scott Alexander: "We told the team the old owner was stepping back, but one of our leaders started crying, saying she was planning to leave due to the bad culture."

These insights indicated underlying cultural issues and hinted at potential operational challenges post-acquisition.

4. Discovering Deception and Cultural Sabotage

Shortly after the acquisition, Scott uncovered troubling revelations. The original bookkeeper had been deleting invoices to obscure the true state of the business, masking a sharper decline in revenue and high client churn. Additionally, the former owner's aggressive and micromanaging style had fostered a toxic work environment.

[46:40] Scott Alexander: "We found out the bookkeeper was deleting invoices, which meant our revenue was nowhere near as healthy as it looked."

These discoveries underscored the necessity of deep due diligence and highlighted the critical role of company culture in business success.

5. Addressing and Overhauling Company Culture

Recognizing the detrimental impact of the previous culture, Scott took decisive steps to realign the team. He implemented strict accountability measures, established clear expectations, and fostered a positive, supportive environment. Hiring a trusted COO and a dedicated recruiter further strengthened the operational framework.

[58:54] Will Smith: "Does that mean you need to start auditing the entire org chart to see who needs to find a new bus to get on?"

[59:17] Scott Alexander: "We started holding accountability, providing clarity, and ensuring that everyone was aligned with our new objectives."

These changes were pivotal in stabilizing the workforce and setting the stage for future growth.

6. The Impact of Covid-19 and the Pivot

In March 2020, the Covid-19 pandemic struck, resulting in an unprecedented 80% drop in revenue within two weeks. This crisis forced Scott and his team to rethink their business model fundamentally. Leveraging their existing knowledge in B2B marketing within the healthcare sector, they pivoted towards building a fractional marketing department for medical technology companies.

[65:39] Scott Alexander: "We lost 80% of our revenue from March 16 to April 1, 2020. It was like, this is what we're going to do. Here's how we're going to do it."

This strategic pivot involved redefining their value proposition, focusing on B2B clients in healthcare, and developing innovative lead-generation strategies using digital platforms like Facebook and LinkedIn.

7. Rebuilding and Growing Gyrus Marketing

Through focused effort and strategic adjustments, Scott rebuilt the agency from the ground up. By May 2020, Gyrus Marketing secured its first client, followed by subsequent wins in the ensuing months. The dedication to solving meaningful problems for healthcare providers and maintaining strong client relationships fueled their steady growth.

[82:51] Scott Alexander: "We renamed the company Jairus... started working 13-day stretches, focusing on sales and client acquisition."

By 2021, the company had scaled to 30 employees and achieved mid seven-figure revenues. Scott attributes this success to a strong team, clear processes, and unwavering commitment to their core values.

8. Key Lessons and Advice for Acquisition Entrepreneurs

Throughout the interview, Scott shares several critical lessons for those looking to acquire and grow businesses:

• Thorough Due Diligence: Understand not just the financials but the quality of revenue and underlying client dynamics.

• Cultural Alignment: Assess and align company culture to ensure harmonious operations post-acquisition.

• Adaptability: Be prepared to pivot business models in response to unforeseen crises or changing market conditions.

• Passion for Clients: Choose clients you enjoy working with to sustain long-term engagement and avoid burnout.

[100:09] Scott Alexander: "Make sure you like your clients because you're going to spend a lot of time with them. If you get frustrated, you're going to burn out quickly."

• Defensible Sales Position: Develop a strong, specialized sales strategy that differentiates your business and attracts consistent clients.

9. Looking Forward: The Future of Gyrus Marketing

Scott remains focused on building robust processes and a capable team to ensure continued growth. By maintaining a clear vision and adapting to the evolving needs of the healthcare marketing sector, Gyrus Marketing is poised for further success.

[100:50] Scott Alexander: "I'm focused on building the right processes and people because the scoreboard will reflect that work."

Conclusion

Scott Alexander's story serves as a powerful testament to the challenges and triumphs of acquisition entrepreneurship. From navigating deceptive practices and toxic cultures to pivoting amidst a global pandemic, Scott's resilience and strategic acumen transformed a collapsing business into a thriving enterprise. His insights on due diligence, cultural alignment, and passion for clients offer valuable guidance for aspiring business acquirers.

Notable Quotes with Timestamps:

• [25:25] Scott Alexander: "I do. Yeah, exactly. Yes, yes I do. It was one of those things where in reflection we missed two things."

• [46:40] Scott Alexander: "We found out the bookkeeper was deleting invoices, which meant our revenue was nowhere near as healthy as it looked."

• [58:54] Will Smith: "Does that mean you need to start auditing the entire org chart to see who needs to find a new bus to get on?"

• [59:17] Scott Alexander: "We started holding accountability, providing clarity, and ensuring that everyone was aligned with our new objectives."

• [65:39] Scott Alexander: "We lost 80% of our revenue from March 16 to April 1, 2020. It was like, this is what we're going to do. Here's how we're going to do it."

• [100:09] Will Smith: "We hear so much about kind of blue collar versus white collar, the culture of the business that you might target... but I have heard far less, if at all, the idea of liking your customers and you know, this is who you're going to be spending time with."

• [100:09] Scott Alexander: "Make sure you like your clients because you're going to spend a lot of time with them. If you get frustrated, you're going to burn out quickly."

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