Upsize Minnesota May/June 2022

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GET ‘EM N’ KEEP ‘EM

Market forcing companies to get creative in hiring and retaining employees

“ We want to personalize what seems impersonal when people apply for a job.”

Mat Krisetya Executive lead organizational health Fresh Energy

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CONTENTS May • June 2022 • Vol. 21 No. 3 • www.upsizemag.com

PAGE 12

Cover story

It’s hard to hire right now. Employees have leverage. Unemployment is low and the available workforce is shrinking. So, what can companies do to attract new talent? And what does it take to keep them once they start?

BY ANDREW TELLIJOHN Cover photograph by Tom Dunn PAGE 4

Founder’s Forum: Upsize Founding Editor Beth Ewen reflects with Clientek Founder Kirk Hoaglund on growing up in a small town and finding his way into a business career..

PAGE 4

Staff list: Who’s who at Upsize magazine and how to reach us.

BUSINESS BUILDERS

COLUMNS

PAGE 6

PAGE 18

HIRING Speeding up the hiring process and taking a brand assessment will help hire the right people

by Stacey Stratton, True Talent Group

PAGE 8

LAW

A recent Minnesota Supreme Court case has changed the attorney-client privilege landscape

by Andrew Escher, Winthrop & Weinstine

Upsize Minnesota (USPS 024-029) is published bi-monthly by Broad Axe Media, 2908 W 71 1/2 St., Richfield, MN 55423. Periodicals postage paid at St. Paul, MN and additional mailing offices.

Postmaster: Send address changes to Upsize Minnesota, PO Box 23238, Richfield, MN 55423-0238

PAGE 10

MANAGEMENT The right business culture sets the standard for behavior and developmental targets

by Mark Komen, Kodyne Inc.

FEATURE The gig economy is expanding into C-suites as companies start using fractional executives to fill important roles in a part-time manner rather than bringing someone on at full-time costs PAGE 22

CATCHING UP Discover Strength CEO Luke Carlson discusses sticking to a strategic niche to survive the COVID-19 pandemic and plans to expand going forward using franchising PAGE 28

BACK PAGE Branding expert Kate DiLeo wrote a book about how branding agencies need to do less storytelling and more listening to better meet their clients’ needs

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A one-of-a-kind business journey FOUNDING PUBLISHER Wes Bergstrom

EDITOR AND PUBLISHER Andrew Tellijohn atellijohn@upsizemag.com

FOUNDING EDITOR Beth Ewen bewen@upsizemag.com

DESIGN DIRECTOR Jonathan Hankin jhankin@upsizemag.com

CHIEF FINANCIAL OFFICER Dan O’Connell dano@upsizemag.com

PHOTOGRAPHER

Tom Dunn tom@tomdunnphoto.com

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UPSIZE MAY • JUNE 2022

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his November Kirk Hoaglund and his IT consulting company Clientek will celebrate its 30th anniversary. “We have offices in four countries; we have a couple hundredish people and we work with clients all over the world,” said the Renaissance man, a bass who sings opera, started 26 companies and counts his small-town roots as key to his success.

“We’re still a small company, in the tens of millions, but we primarily do business with really big companies. And it’s for the same reasons that a lot of small companies like ours are favored.

We can move fast, we have a sharp focus, they can meet the owner,” he said.

He also has been a friend to Upsize since the beginning, in 2002, sponsoring events and lending advice to other business owners. He counted Wes Bergstrom, the late founder of Upsize, as the embodiment of our mission: to connect business owners with experts who can help.

Hoaglund always relied on “just simple advice from others. I never used the Yellow Pages. I always used the telephone and called somebody I knew.”

Hoaglund has taken a winding road in his four-plus decades in business.

He grew up in Pine Island, Minnesota, 1,800 population. “People kind of let me be what I was. I didn’t feel a lot of shaping sort of expectations from my parents or teachers or community. It was more like, ‘Oh, this is what Kirk likes to do and is good at, so that’s cool I guess,’” he said.

At the University of Minnesota in Minneapolis, “I was planning to triple major as a silly young thing. I was way into music. I was also way into visual arts and way into computers. I wanted to get two B.F.A.s and a B.S. and some might say that’s a load of B.S,” he said.

“Then I met Anita,” his wife. “She was the principal violinist for the orchestra and I was section leader for the bass section of our choir.”

His plans changed. “I thought, ‘hmmm, I can’t be in college for 15

years here.’” He took a job with Control Data Corp. “At that time they were ‘the thing’ in Minnesota. That was an incredible job for a geek.” After 10 years Clientek was born.

Hoaglund isn’t one to “wax philosophical,” he says, but he indulges my question about the roads not taken.

Any regrets? “You have to make it be about the journey and not about the destination. There’s no way I could have planned or predicted what happened and where I landed. But if I look at the list of the people I’ve met from all over the world, that’s one of my favorite things about landing where I’ve landed.”

His last conversation with Bergstrom yielded a promise that Upsize would run a full-page ad for Hoaglund’s notfor-profit music performing company, The Orpheus Project. Orpheus was set to mount a new opera in January 2020, but the pandemic scuttled those plans.

Bergstrom, a philosophy major who was always seeking knowledge, said, “You know what, maybe I should take Upsize to a non-profit. Maybe I should develop a mission like you’re talking about now,” Hoaglund recalled. “That was the last conversation I had with him. He was one of a kind.”

—Beth Ewen founding editor bewen@upsizemag.com

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Advice driven by advocacy.®

One of the best parts about being a financial advisor is seeing the individuals and families we work with go from building assets to actually using them to help fund their retirement. Helping clients transition to the stage they’ve been planning for all this time is really rewarding.

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Advisor JNBA Financial Advisors

A client-first and conflict-free philosophy: that’s how JNBA Financial Advisors has operated since our founding days over 40 years ago. Since we began tracking in 2001, we have been fortunate to maintain a client-retention rate of 97 percent. And, Barron’s has ranked JNBA and CEO Richard S. Brown #1 in Minnesota on its Top 1,200 list for two consecutive years.* To learn more about how advice driven by advocacy® could help you and your family, begin a conversation with our team by calling us or visiting JNBA.com.

MINNEAPOLIS: 952.844.0995 | DULUTH: 218.249.0044 | BONITA SPRINGS, FL: 800.675.4793 | JNBA.COM *As seen in the 3/15/21 & 3/14/22 issues of Barron‘s magazine. Barron‘s is a trademark of Dow Jones & Company, Inc. All Rights Reserved. Please Note: Limitations: Neither rankings and/or recognitions by unaffiliated rating services, publications, media, or other organizations, nor the achievement of any professional designation, certification, degree, or license, membership in any professional organization, or any amount of prior experience or success, should be construed by a client or prospective client as a guarantee that he/she will experience a certain level of results if JNBA is engaged, or continues to be engaged, to provide investment advisory services. Rankings published by magazines, and others, generally base their selections exclusively on information prepared and/or submitted by the recognized adviser. Rankings are generally limited to participating advisers (see link as to participation criteria/methodology, to the extent applicable). Unless expressly indicated to the contrary, JNBA did not pay a fee to be included on any such ranking. No ranking or recognition should be construed as a current or past endorsement of JNBA by any of its clients. ANY QUESTIONS: JNBA’s Chief Compliance Officer remains available to address any questions regarding rankings and/or recognitions, including the criteria used for any reflected ranking. Past performance may not be indicative of future results. Different types of investments involve varying degrees of risk. Therefore, it should not be assumed that future performance of any specific investment or investment strategy (including the investments and/or investment strategies recommended and/or undertaken by JNBA Financial Advisors, LLC (“JNBA”)) or any non-investment related services, will be profitable, equal any historical performance level(s), be suitable for your portfolio or individual situation or prove successful. A copy of our current written disclosure Brochure discussing our advisory services and fees is available upon request. The scope of the services to be provided depends upon the needs of the client and the terms of the engagement. Please see important disclosure information at jnba.com/disclosure.

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hiring

BUSINESS BUILDERS

Adapting to the changing, competitive hiring landscape

by Stacey Stratton

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Evaluate your hiring process.

Scale back on any steps that impede a candidate’s application.

Do a brand audit. Take steps to assess and promote your company’s story on review sites like Indeed, Google Reviews and Glassdoor.

Craft a clear picture of your work culture. Provide candidates and all interviewers with a detailed view of where your organization is right now and where it’s headed.

Offer remote and hybrid options. Offer flexibility to prospective employees by accommodating a variety of work preferences.

Prepare for quick decisionmaking. Aim to make a hiring decision no longer than two weeks from the first interview.

UPSIZE MAY • JUNE 2022

With a mere 2.7 percent

unemployment rate in the state of Minnesota — and 3.6 percent nationwide — finding the right talent is tougher than ever. Candidates can be as selective as they like when it comes to accepting employment offers. I’ve seen how this shift has affected employers and candidates alike. If your company is ready for that next great hire and wants to keep your current top performers, here are my top three recommendations to help you stay competitive.

Streamline your hiring process Conventional wisdom has always been “Hire slow, fire fast.” The current hiring market has forced a change to this saying. It’s now: “Hire fast, fire fast.”

The market is hot right now. Companies prepared to move fast are winning the top talent. Gone are the days of having candidates meet with every imaginable permutation of the hiring manager, department team and extended leadership over the course of three months.

What I’m seeing over and over?

Companies that have a clear job description, approval from human resources, hiring manager and budget sign-off ready before they post an open position are being rewarded with the top candidates.

Best practices • Evaluate your hiring process.

Scale back on lengthy and repetitive application paperwork in favor of seeing candidates

•

as individuals, not algorithms.

Prepare to move quickly.

Candidates won’t wait indefinitely for decisions. You should aim to make your hiring process from the first interview to final offer no more than two weeks.

Make your work culture shine While the current market is fastmoving, attracting and retaining top talent remains a marathon, not a sprint. Making adaptations to the new pace of hiring is important but staying in the game requires attention to your company’s overall brand and culture.

Organizations that are adept at telling the story of their brand and work culture are at an advantage.

Online review platforms make finding out what the work life of a company is like even easier for potential candidates.

One way your organization can make your work culture shine is in interviews. Take the time to craft a candid story about your company’s current situation. Are you growing?

Are there challenges that require intense problem-solving or innovation? Are you looking to expand into new markets? Making sure your candidates have a good grasp of your company’s needs and values not only helps you find the proper match, but it also keeps the story of the brand top of mind for current employees, too.

There are many ways to promote your company’s wins and values.

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Conduct a brand audit to get information about how your organization is perceived from outside and from within. Have current employees rate and review your workplace to get the word out.

Best practices • Craft a compelling and clear company story. Communicate to everyone who’s involved in interviews what the narrative is and why it matters.

• Do a brand audit. Take charge of your company’s reputation both internally and externally by taking steps to make this story positive and transparent on review sites like Indeed, Google and Glassdoor.

Offer remote work options A recent Gallup poll made the situation clear: Nine out of 10 employees want the option to work remotely to some degree. For companies locked into long-term leases or who have just invested in brand new corporate facilities, this can be a hard pill to swallow. But the last few years of remote work have shifted the dial. Doing long commutes, making packed lunches and prepping officeready outfits are no longer priorities for many, especially parents of young children.

The downsides of on-site work have become clearer for many. For those in creative or highly technical fields where getting “into the zone” matters most, an open-office plan has become unthinkable. For every person who loves the social dynamics of the office, there’s someone else who’s thrived working from home, alongside their pets, without communal microwaves and messy break rooms. And opening positions

to remote work makes the slate of potential candidates much more diverse.

Best practices • Offer remote and hybrid options. Top talent is going to organizations that respect and accommodate their work preferences.

• Open your search beyond your local area. Take advantage of the enlarged talent pool that remote work can offer and help raise your company’s profile as one that values flexibility and work-life balance.

A dynamic hiring market now and in the future?

It’s not easy to manage shifts in hiring norms. And it’s a challenge to make internal changes in response as well.

But keeping informed on what HR professionals and talent search firms are observing out in the greater business marketplace puts you at an advantage. Check in with your talent acquisition team and other people in your professional network to stay updated on what’s going on out in the larger world.

While low unemployment can be an encouraging factor for policymakers, it’s requiring an agile and dedicated response from employers.

Remember: your workers are the greatest asset of your organization.

An intentional and steady effort to attract the best and the brightest not only makes ethical sense, but it also makes your business stronger and more prepared to weather what comes next.

“ An intentional and steady effort to attract the best and the brightest not only makes ethical sense, but it also makes your business stronger and more prepared to weather what comes next.”

Stacey Stratton True Talent Group

Contact: Stacey Stratton is founder and CEO of True Talent Group, a talent firm based in Minnesota that places candidates nationwide: 612.860.0307; stacey@truetalentgroup.com; www.truetalentgroup.com; LinkedIn: /company/true-talent-group www.upsizemag.com

MAY • JUNE 2022 UPSIZE

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law

BUSINESS BUILDERS

Attorney-client privilege: What you must know

by Andrew Escher

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Recent changes to attorneyclient privilege laws mean Minnesota businesses should be cautious and take affirmative steps to keep their confidential information safe.

To qualify for protection, the primary purpose of the communication must be obtaining or providing legal advice. Merely sending a document to your lawyer does not qualify.

The Minnesota Supreme Court adopted the “predominant purpose” test, which considers a communication’s purpose, content, context and recipients, to determine if privilege applies to the whole communication or only part of it.

Set out in advance of engagements with your attorney, in writing, that the attorney will provide legal (and not business) advice, including as much detail as is practical.

Once a document is stamped “confidential,” it’s important to keep the document actually confidential, limiting the number of people who receive it.

UPSIZE MAY • JUNE 2022

We’ve all heard the term “attorney-client privilege,” but do you know what it actually means?

Many businesses and individuals assume it protects all communications with their attorney – including emails, documents, advice and recommendations – but this is not always the case.

Plus, recent changes to the law mean Minnesota businesses should be even more cautious and take affirmative steps to keep their confidential information safe.

The basics of attorney-client privilege Attorney-client privilege protects from disclosure communications that are made in confidence between the client and lawyer for the purpose of obtaining or providing legal assistance. Its goal is to “encourage full and frank communication.”

However, not all communication between a business and its lawyer is automatically considered privileged.

To qualify for the protection, the primary purpose of the communication must be to obtain or provide legal advice; merely sending a document to your lawyer does not make the document itself privileged.

The attorney-client relationship grants a right to have communications protected from disclosure to another party, such as competitors, business partners or broader audiences, but it is most commonly invoked when a business finds itself involved in a lawsuit and ordered to produce documents.

“Ordinary business advice” and the predominant purpose test In the recent Minnesota Supreme Court case In re Polaris, Inc., Polaris was sued in a product liability lawsuit after one of its vehicles caught fire. During the litigation, Polaris

inadvertently gave an audit report marked “PRIVILEGED AND CONFIDENTIAL: Protected by Attorney Client Privilege and Attorney Work Product” to the opposing party.

When Polaris’s attorneys learned of the mistake, they asked the opposing party to return it and destroy their copies. This request was refused.

Polaris filed a motion to have the district court order the same thing.

The motion was denied, although the court did require those portions of the report embodying legal advice to be redacted. Polaris appealed this ruling, first to the Minnesota Court of Appeals and, after that appeal was denied, to the Minnesota Supreme Court.

In its ruling, the Minnesota Supreme Court focused on whether the “contested document embodies a communication in which legal advice is sought or rendered” and formally adopted the “predominant purpose” test, which considers a communication’s purpose, content, context, and recipients to determine if the privilege applies to the whole communication, or only to part of it.

It was undisputed that the Polaris report contained both legal advice and business advice. Applying the predominant purpose test, the Minnesota Supreme Court found that the report’s primary purpose was setting corporate policy, not providing legal advice. Accordingly, the Minnesota Supreme Court affirmed the lower courts’ rulings and held that only portions containing legal advice were privileged.

Though the decision in this case introduces uncertainty — will documents with dual purposes of providing both legal and non-legal advice be subject to disclosure in litigation? – businesses can tailor the way they interact with their lawyers to hedge against unintended disclosure

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of communications and achieve the broadest application of the attorneyclient privilege.

Four main takeaways for businesses First, at the beginning of an engagement, set out that the attorney will provide legal (and not business) advice. This should be done in writing, stating with as much detail as is practical, which legal services and advice the attorney will provide.

For example, the engagement letter can set out which laws and regulations led the business to seek the attorney’s advice and, as applicable, connect the lawyer’s work to ongoing litigation or investigations. If the scope of the engagement expands over time, it may make sense to revisit the original letter and document the expansion.

Second, assess whether documents being drafted by attorneys could create risk of future disclosure. If the topics being considered by attorneys tend toward business considerations (for example, profits and losses) instead of legal advice (the likelihood of success in a lawsuit), then it may be safest to adjust what those documents cover to lessen the chance that they can be used against the business during future litigation.

Third, prominent disclaimers that the attorneys are communicating their legal analyses are advisable, and should be included in formal reports, audits, etc. While stamping a document “Attorney-Client Privileged” does not in itself make the document privileged, it does indicate to its readers that it was meant to be kept confidential.

Finally, none of the other precau-

tions matter unless the attorney-client communication is actually kept confidential. Once an attorney-client privileged document is received, the number of people within the company receiving that document should be limited. Depending on the circumstances, distributing a document beyond senior executives and the board of directors could lead a court to find the document had not been treated as confidential and was therefore not protected by the privilege.

Many organizations rely on their lawyers for business advice as well as legal counsel. Moving forward, the In re Polaris, Inc. decision potentially creates significant difficulties for businesses as they must now question further whether their communications with their attorneys, and vice versa, will be protected by the attorney-client privilege, and whether a court will second guess the parties’ understanding and intent in creating the communication at issue.

Effectively, courts now have the authority to look much more closely at the nature of the communication and find that fewer communications fall within the protected category of “legal advice.” In the future, the ambiguity surrounding what communications will remain confidential could impede open communication between businesses and their lawyers for fear of confidential information being disclosed later during litigation. Nevertheless, if businesses and their lawyers take appropriate precautions to mitigate this risk, they should still enjoy the full scope of protection offered by the attorney-client privilege.

“ Businesses can tailor the way they interact with their lawyers to hedge against unintended disclosure of communications and achieve the broadest application of the attorney-client privilege.”

Andrew Escher Winthrop & Weinstine

Contact: Andrew Escher is an attorney at Winthrop & Weinstine: 612.604.6445; aescher@winthrop.com; www.winthrop.com

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MAY • JUNE 2022 UPSIZE

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management

BUSINESS BUILDERS

Unraveling the mystery of organizational culture

by Mark Komen

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Senior management often sees the current culture in a different light than other staff members.

Culture should be written down and communicated to staff so everyone begins on the same page.

You may be unaware of how your organization’s management and leadership practices are enabling success or producing failure. You should. Knowing what’s getting in the way makes substantial change possible.

Culture sets behavioral standards and developmental targets for all staff. These standards should be spelled out for all jobs and added to performance reviews and job descriptions.

Hire to fit the culture you need to have to achieve success rather than the one you currently have, if that one is not producing the desired results.

As important as culture is, it’s often left unaddressed by businesses, which can render the best strategic plan useless.

UPSIZE MAY • JUNE 2022

If you’re a business leader,

how things get done in your organization must be a critical concern for you.

In many cases, you’ve been the one vetting and hiring new staff members in the hope they’ll be productive and effective team members. Or perhaps you have a management team responsible for this.

Regardless, whatever measure you use, whether revenue, net income or living your mission, the buck stops with you when it comes to the overall success of your organization.

But have you set the stage for your staff members’ success or have you set them and your organization up for failure? We all know, and perhaps lived, horror stories stemming from companies making bad hires, rewarding negative or destructive behaviors, tolerating poor performance and their resulting impacts on things like productivity, customer service, staff turnover and perceptions of your brand. The effects are far-reaching. And expensive.

How does culture come into play?

The word, “culture” has unfortunately been reduced to an overused buzzword.

I have heard companies promoting their “employee-centered culture” or their “fun culture.” Both of these examples are likely talking about organizational climate, not culture. Culture and climate often get commingled as concepts but they are related.

To help unpack this, here is the culture definition I use: Culture is the characteristic patterns of thinking and behaving shaped by the shared beliefs, values and underlying assumptions of an organization’s members.

In other words, culture is cognitive — it’s what we know through actions and messages. It reflects how things work or are expected to work in your organization.

On the other hand, “climate” is perceptual. It’s what we sense and perceive.

It answers the question “How does it feel to work here?” And this can change as circumstances change.

Leaders need to attend to both climate and culture. Employees act on the basis of what’s expected of them (culture). Employees react to the way things are, based on what they sense and experience (climate). A positive climate will inform a constructive work culture.

But clarity around acceptable cultural behaviors (norms) is critically important.

If you, as the leader of your organization, are clear about what it takes to fit in and meet expectations, then you have done the first part of your job when it comes to managing your culture. The second part is designing your workflows, processes, procedures, practices, reward systems, etc. to be in alignment with the culture. The third part is holding others accountable to the culture you are aiming to build.

A caution for business leaders: Culture happens on its own unless you establish the one your organization needs to be successful. Emergent cultures that arise organically can be counter-productive to your organization’s needs and aims. I am a proponent of building a culture with intent to align with the organization’s vision, mission, values and brand.

Why should I care about culture?

Culture is literally the backbone of your organization — all your people systems and operational systems are enhanced or inhibited by your culture.

Here are some valuable considerations: • It’s how things really get done — Do you do things because “That’s the way we’ve always done them?”

What happens when there’s a failure? Is there learning or punishment? There can be many disconnects between what leaders say they want and what really happens.

• It’s visible to your employees, customers and suppliers — Although staff members can tell you firsthand about how they experience culture, this is evident to everyone who interacts with your

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organization, from how inbound contacts are handled to problemsolving to the customer experience.

Understand what’s working for you and against you — You may be unaware of how your organization’s management and leadership practices are enabling success or producing failure. Culture involves a complex set of interlocking components that involve everything from personal styles to systems, structures and even job design.

Knowing what’s in the way of success presents the opportunity for meaningful change.

It sets behavioral standards and developmental targets for all staff — These must be clearly spelled out for all job families and should be added to job descriptions and performance reviews.

It helps to set hiring and promotion standards for fit — Bring culture into your hiring and promotion process, especially for key or strategic positions. I recommend hiring for fit to the culture you need to have to achieve success rather than the one you have if that one is not producing the desired results.

Mergers and Acquisitions — If you’re an acquirer, do you know what you are buying? Merging or managing dissimilar cultures can be a nightmare. Similarly, who would want to buy and assimilate an operation that is in the throes of dysfunction? Making your organization attractive to a buyer is a significant reason to consider your organizational culture.

The Challenge of Changing Culture This is no simple task. Sometimes, it’s a matter of clarifying current expectations. Other times it’s a long-haul journey to re-think your organization’s

operating systems and take a close look at your organization’s leadership and management skills and abilities. It may require a deep dive to uncover barriers to change. Here’s a brief overview of the process.

• Where to begin? Start by understanding what your current culture is — what expectations are management and staff operating under? Are these written down somewhere and communicated?

Senior management often sees the current culture in a different light than other staff members.

• Determine the ideal culture that would support your organization’s vision, mission, values, business objectives and maximize your effectiveness.

• Define the cultural behavioral expectations that would need to be implemented at all levels of your organization to achieve this ideal.

• Create a roadmap for aligning staff members with the new expectations.

• Redesign your performance management system to align with and provide accountability to the new cultural expectations. Then ensure the rest of your policies and practices are in alignment with these.

“ Culture is literally the backbone of your organization — all your people systems and operational systems are enhanced or inhibited by your culture.”

Mark Komen Kodyne

Conclusion Culture is a critical, yet often unaddressed component of a successful and sustainable business. The best strategic plan in the world can be rendered useless if the organization implementing it is not equipped to carry it out. Understanding the culture that you have is the first step toward building the organization you want.

Contact: Mark Komen is president of Kodyne Inc.: 763.551.4777; mark@kodyne.com; www.kodyne.com; in.markkomen.

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MAY • JUNE 2022 UPSIZE

11

CREATE an

EXPERIENCE Companies need creativity, flexibility in hiring and retaining

F

resh Energy, a non-profit in St. Paul dedicated to shaping policy that leads to carbon-neutral economies, works in a growing niche, but not one everyone knows about.

Add in the “Great Resignation” and the organization has been honing its strategies, not only for finding new workers, but for retaining those already on board.

The company has tried to personalize its job postings, including with them videos from the hiring manager so potential applicants will know who they would be working for, says Mat Krisetya, executive lead organizational health. Fresh Energy also sends interviewees questions in advance, so they are less nervous and can have a more comfortable conversation when they do apply.

“We want to personalize the things that seem impersonal when people apply for a job,” he says. “Anytime a person gets into an interview they are always nervous. We want to know who you are. If they are nervous, they are unable to reveal who they are. That’s what is important for us.”

It’s also working on its retention strategies, adding this year to its long-standing half-day Fridays during the summer new benefits such as allowing parents-to-be to accrue

six weeks of paid time off from the previous year so they can take a full 12-week paid leave and allowing workers to begin vesting in their 403(b) retirement plans immediately.

“We understand there is life besides work,” he says. “We want to partner with them so they know that Fresh Energy supports their life outside of work.”

Fun on Facebook

Fresh Energy isn’t the only company trying out new strategies to attract workers. Carly Sutheimer, owner at C&T Siding & Windows, was at wits’ end. She’d been trying to hire laborers but even with signing and retention bonuses was struggling to get noticed.

“I had tried everything in the book,” she says.

On a whim, she created a cheeky Facebook post saying workers could make $1 an hour — and the job wasn’t for them if they couldn’t show up on time or wouldn’t work hard.

“It was like a joke,” she says. “You wouldn’t believe it. I think it just caught people’s attention and made them laugh” Not everyone got it — some people commented on the post about how nobody would want to work for such a low wage.

Fresh Energy overhauls its benefits regularly to retain employees and is personalizing the interview process to find more.

by Andrew Tellijohn photographs by Tom Dunn

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UPSIZE MAY • JUNE 2022

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APRIL • MAY 2012 UPSIZE

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COVER STORY “But it was mostly to get people’s attention,” she adds.

And it worked. She ended up interviewing 14 applicants who responded to the post and hired four, three of whom were still with the company after several months “and have turned out to be great guys.” A similar post a few weeks later landed a quality salesperson.

“It got people’s attention,” she says. “That was everyone’s response was ‘we thought you might have a sense of humor with the ad you put out. It caught our attention.’ Along with the ad, the second thing that a lot of the guys said to me was that a lot of them were tired of being treated like a number.”

Sutheimer says once she gets people in the door, they often stay because of the flexibility and family feel, knowing that if they need to take a day off due to a family health or school situation, they’ll be ok. The ads just gave her a way to stand out.

“It just ended up catching people’s attention and got them in the door,” she says. “As soon as I got them in the door and told them what we offer, it was almost a done deal.”

creativity is what is needed in these times.”

It might not have been necessary a decade ago, but times have changed. Not only are many workers moving around a lot, but baby boomers are retiring and there is going to be a long-term shortage of workers.

“Entrepreneurs need to flip this switch,” he says. “This is not transitory. Demographically this contraction in the number of people available for the workforce is going to be a 20, 30 or beyond year problem before it starts getting better.”

Chelsey Paulson, chief strategy officer at Keystone Group International, echoes the need for creativity. She encourages companies to experiment and to take feedback from employees. Executives need to be present on social media, particularly LinkedIn, recruiting for talent, but they can’t do the job alone.

“It’s everybody’s job to recruit,” she says, adding that it is a crucial time to be implementing new strategies.

“If you’re not trying to think differently, think innovatively and gather a variety of opinions with any decisions you are making, you are losing out,” she says. “We’ve done a lot of innovation sessions with our clients looking at ‘how do we gather more feedback.’”

Be creative There is no silver bullet, other than using a variety of techSutheimer says she didn’t think the ads were that big niques to find employees, she adds. Referrals, with bonuses a deal. But she’s a client of Pinnacle Business Guide Jon spread across multiple payouts over time, are one strategy.

O’Malley, who owns Leadership Team Results. He says comPaulson says companies that have, in the past, offered internpanies need to get creative and find ways to stand out. ships are now approaching those jobs as more of an appren“It was very tight before the pandemic,” he says of the ticeship, where they train workers and, if it feels like a fit, hire employment market. “It’s just very much accentuated now.” them on long-term.

Small companies need to embrace their strengths — the “When you’re making these hires, you need to be looking for ability to be more flexible and to treat their employees better by finding real human connections and getting to know drive, for motivation, for desire to learn and to grow,” she says. them individually.

“If that is part of who they are, this is why the apprenticeship is “Bigger clients, you literally can’t do that. It’s impossible,” genius. Bring them in, see what they can do. You’re not commithe says. “There are a lot of really high caliber people out ted to anything. But it’s a try before you buy for both sides.” there for whom money is not their number one motivator for where they want to work. There are a lot of people where Hiring from different pools that is a big motivator, but small businesses can absolutely One final strategy is being willing to shake up the traditional compete. They just need to understand they need to com9-to-5 workday and find other resources for hiring that bring in pete in those areas where they can compete.” talent unwilling or able to work traditional shifts, but valuable They need to be creative in finding people to hire. They for their skills. Paulson cited Hire Our Heroes, which focuses can do that by tapping into their own networks and the on veterans, and Bus Stop Mamas, a firm focused on helping networks their employees bring with them, O’Malley says. mothers find flexible employment.

They need to try new things. Like Sutheimer. And like the Mary Kay Ziniewicz, founder of Bus Stop Mamas, says the CEO of a water heater installation company he works with organization has grown significantly in recent years. A few large who needed technicians. The CEO would sit in the parking companies have jumped on board. lot outside plumber supply companies, find someone who But more than 90 percent of the recruiting base has been looked like a candidate, chat with them as they walked in the small businesses realizing the value in connecting with store together and hand the person a flyer and a mug in the talented mothers looking to get back into the workplace. Bus parking lot if he got a good vibe.

Stop Mamas is helping them find mothers in roles ranging “He hired several good employees using that method,” from administrative assistant to the C-suite.

O’Malley says. “Some of those guys would take that flyer “This message we believe that equity comes through flexible out and give him a call. My point in all this is that level of work is really catching on and understood by employers in a 14

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COVER STORY It’s vital for companies to get creative and use new recruiting strategies for finding new employees, sources say, adding that the market is likely going to be tight for years to come.

new way,” Ziniewicz says. “‘We felt the burden when they left.

How do we get them back and how do we keep them? How do we attract and retain women throughout their careers.’”

Technology for hiring and retention

Alice Walker, principal with HR WoRx, touts the use of technology as a way of improving chances for a successful hire.

An applicant tracking system, she says, not only allows you to receive information during an interview process that can be turned into a payroll record. The programs also usually contain aggregators that allow you to create a requisition and then post it to many sites at the same time.

“I tell my clients push it out everywhere you can,” she says.

“Make sure you hit every free site, then maximize your dollars with all the other job advertising sites you want. You can cast a wider net.”

The applicant tracking system also gives a timelier response.

“As soon as they do apply, you need to jump on them because there are probably 10 other companies calling,” she says.

“Timing is everything.”

It isn’t technology-related, but Walker also recommends that companies dial back on the requirements they include in job postings. When she started in recruiting, Walker says frequently “the manager would take every skillset missing in their group and put it into one position,” she says. “Where do you want me to post that? Fantasy Land?”

The market has shifted. With workers having more leverage, companies are now having more success asking for a few “must haves” and more characteristics such as eagerness to learn.

Applicants are “more interested in getting a job where there is a chance to go somewhere in their career,” Walker says.

Fixing your retention strategies

Finally, emerging HR technologies allow for the creation of online bulletin boards where potential candidates who may not be interested in a job right now will post contact information you can use to build a pipeline when other jobs open later on, Walker says.

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COVER STORY Creating communities like that, Walker says, can also help with retention, she says. For example, having people in the profession people can go to besides a supervisor when they feel overwhelmed with their job can be valuable.

And at a time when it’s difficult to hire new people, it’s valuable to try and retain the ones you already have on staff.

Make sure you understand what makes your employees tick. It doesn’t always have to be money, Walker says. If you’re hiring a maintenance technician, a form of recognition for a senior person in that role on staff might be the opportunity to become a mentor to a junior technician you hire knowing the person needs some training.

“You’re naturally creating a career path now,” she says.

“If there’s room for growth, that’s what they’re looking for.”

Steve Schad, president of fractional HR provider Optima Advisory LLC, says where companies used to focus in surveys on job satisfaction, they must now look at engagement and their thoughts on the employee experience.

“It really is from the vantage point of the employee in terms of when I join a company, what is my experience like?” he says. “When you think about the work experience through that lens, it looks very different from looking at it through management’s lens.”

The shift is being driven by the power employees have in this environment. Companies need to make sure, for example, that managers are positive, motivating, fair and open to hearing employee concerns. Employees these days, Schad says, also care immensely about making a difference and ensuring their work is in line with their values.

“That starts to point toward levers the company needs to pull in order to be a well-run organization that treats its employees in a way that makes them A) work there if they don’t and B) stay there once they get there,” he says.

And it gets well beyond dollars and cents. Schad says one simple thing organizations can do is implement a goal setting and performance management process.

Research indicates that if people have clear goals and know their roles, “that is one of the key drivers of employees being committed to an organization and intending to stay,” he says. “That’s motivating to people. It’s surprising how few organizations take the time to put in place a process around goal setting and performance reviews, but it’s one of the easiest things you can do that is of almost no cost to the organization.”

While small businesses can’t always compete on pay and benefits, Schad says it also is important to keep up on the marketplace and at least be competitive in compensation.

“You don’t want to overpay,” Schad says. “On the other hand, you want to make sure you are competitive. … You want to neutralize pay and benefits as an issue employees are going to get stuck on.”

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Keep culture in mind

While culture can be a bit of a buzz word, observers say it is an important piece of employee engagement and retention. A company should be able to tell workers about its culture and should also stick to it.

“Without that, companies are just making it up,” Schad says.

Paulson says hiring for culture is more important than for skill. If potential employees fit well, they can and will want to learn many of the skills you need. “Both are important, but it needs to feel like it’s the right fit,” she says.

Adds O’Malley, during this time, the need for sticking to your culture is vital, even if it means letting go of a high performer who just doesn’t fit with the rest of a team. He knows of a company that took a six-figure sales hit in letting someone go. The company did so because the high achiever was poisoning the office atmosphere. Leadership figured it could find another good salesperson, but couldn’t fix a rotted culture.

“The president spoke up and said ‘I care more about the culture than the bottom line’” he. “‘We’ll recover that. We’ll find the right person.’ A lot of companies won’t do that.”

CONTACT: MAT KRISETYA is executive lead for organizational health at Fresh Energy: 651.294.7142; krisetya@fresh-energy.org; www.fresh-energy.org; mwlite/in/matiusik JON O’ MALLEY is owner of Leadership Team Results: 651.248.2775; jon@jonomalley.com; www.JonOMalley.com; in/jonomalley CHELSEY PAULSON is chief strategy officer at Keystone Group International: chelsey@keystonegroupintl.com; www.keystonegroupintl; in/chelsey-paulson-keystone STEVE SCHAD is president of Optima Advisory LLC: 651.587.0588; sschad@optimaadvisoryllc.com; www.optimaadvisoryllc.com; in/steveschad CARLY SUTHEIMER is the owner of C&T Siding & Windows: 715.749.3162; carly@candtsiding.com; www.CandTsiding.com ALICE WALKER is principal at HR WoRx: 952.237.1377; awalker@hr-worx.com; https://hr-worx.com/; in/walkeralice MARY KAY ZINIEWICZ is founder of Bus Stop Mamas: 612.396.9653; marykayz@busstopmamas.com; www.busstopmamas.com; in/mziniewicz

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ALGORITHMS FIND KEY WORDS, NOT KEY HIRES. When you want to find the best person, not the best resumé, call True Talent Group.

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OUTSIDERS ON BOARD Growing companies hiring fractional executives for next step in growth

S

everal years ago, Fidelity Bank was both working on succession planning and implementing the “Traction” portion of the Entrepreneurial Operating System (EOS). While going through some of the prep work, company executives recognized they were not all on the same page on many human resources issues.

The company has always had an internal HR person handling issues like job descriptions, payroll and compensation — the blocking and tackling of HR — but found it could use some help with strategic planning, says Todd Williams, president.

“It became evident that even at the senior levels, there were differing opinions on HR,” he says. “We knew right away that having some HR expertise or some outside perspective was really important.”

Enter Steve Schad, who owns Optima Advisory LLC. Schad is a fractional chief financial officer who, instead of being hired on staff, embeds part-time within several different companies offering insights and advice. With his guidance, Williams says Fidelity has improved its systems, expanded into performance management, which is helping build accountability in the workplace, and hired an HR generalist to work on recruiting and other functions.

“Steve is also working around coaching, mentoring and empowerment, trying to get those tools within our organization,” Williams says. “He also gives us a keen perspective on ‘Hey, this is how other organizations look at this, there’s where you are, you may want to think about these things.’”

by Andrew Tellijohn

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FEATURE “It’s really picked up this year. There’s always been some fractional, but it seems like there are more and more in every area of the business.”

— Cathy Sedacca, Integrated Consulting Services

Ongoing role in growing companies

While Fidelity has achieved many of its objectives in bringing Schad on board, Williams thinks he’ll still be around a while. There are a lot of changes taking place, for example, in the employment market right now where he feels Schad can be a valuable mentor. And Schad will continue to help as the company gets into more coaching and mentoring of its employees.

“I see Steve working with us for a long time to come,” he says.

Fractional executives, Williams adds, can be a great benefit, but companies need to make sure they find the right person for the role. Steve sits in on all company meetings and he did a great job of listening and of giving an outside perspective “in a fashion where it was tailored to us and based along our timeline. I thought he did a really good job.”

The benefits of having the right relationship can be illustrated by the arrangement between Elena See, a fractional content and operations specialist who recently founded Whisper Speak Roar Media, and Susan Cevette, founder and CEO of wealth advisory WatersEdge Wealth Management.

See’s skillset is a bit more general than those brought by some fractional executives, but Cevette says she fit right in. They’d met four years ago, shortly after Cevette went out on her own. They didn’t work together then, but about a year ago, they reconnected. See was looking to change careers and was considering becoming a financial adviser. And Cevette knew she needed additional help in the office.

“Elena just came in and started doing stuff — whatever was needed,” Cevette says. “We carved out a role over the summer.”

See eventually ended up driving WatersEdge’s con-

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tent creation. She has knowledge of Traction, as well, and has led the company down that road, with her playing the integrator role to Cevette’s status as visionary leader. While the arrangement started informally, what developed has been instrumental toward building the company’s future.

“Be fluid,” Cevette says. “Be open to not always knowing what the outcome is going to be but create along the way.”

So, See works between five to 10 hours a week for Cevette doing marketing and Traction and she works with other companies doing workflow creation, project management and training.

“She’s a dynamo,” Cevette says. “Traction has been a game changer. Every week we know where we’re going and what we’re doing. There are many prospects in the pipeline. Our pipeline was dry six months ago. We’ve gotten very clear on what it is we need to do next to generate growth. This next year our growth trajectory will be significant.”

While they enjoy working together and have driven improving results, See says her ultimate goal is to help WatersEdge get to a position where the company can hire one or more people to do even more.

“Then I will go on my merry way,” See says.

Filling all the roles

Fractional executives are filling roles in HR, operations, marketing, finance and basically any other role in the C-suite. The fractional CFO becomes immensely valuable for companies that have grown to around $2 million in sales, says Craig Siiro, CEO and founder of Integrated Consulting Services LLC. Siiro and Cathy Sedacca, managing director, say that’s the point at which seeking financing from a bank for

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FEATURE growth capital becomes more complex than many business owners and their controllers, bookkeepers or family members who figured out QuickBooks are equipped to handle. Fractional executives offer an alternative to the prospects of hiring an expensive full-time CFO. “When they get to $2 million, the entrepreneur has to decide they are going to make it a business, not just a lifestyle company,” Siiro says. “When they decide they’re going to start getting bank loans and grow, that’s when they need that outside expertise because that’s when they are outside their comfort zones.”

The company’s services include helping close books, doing reconciliations, helping with their weekly cash flow and attending meetings. It’s a retainer model on which Siiro banks on building a long-term relationship

CONTACT: JOHN ARMS is co-founder of Voyageur University: 612.590.1995; john.arms@voyageuru.com; www.voyageuru.com; in/johnarms SUSAN CEVETTE is founder of WatersEdge Wealth Management: www.watersedgewealthmanagement.com; in/susancevette-watersedge CATHY SEDACCA is managing director of Integrated Consulting Services: 612.802.1784; cathy.sedacca@integrated-consulting.net; www.integrated-consulting.net ELEANOR (ELENA) SEE is founder of Whisper Speak Roar Media LLC: elena@whisperspeakroarmedia.com; in/elena-see-97b616164 CRAIG SIIRO is CEO and founder of Integrated Consulting Services: 612.669.7703; craig.siiro@integrated-consulting.net; www.integrated-consulting.net TODD WILLIAMS is president of Fidelity Bank: 952.830.7240; todd@fidelitybankmn.com; www.fidelitybankmn.com.

JENNIFER ZICK is founder and CEO of Authentic Brand: jennifer.zick@authenticbrand.com; www.authenticbrand.com; in/jzickinteg

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with clients who will continue working with Integrated Consulting Services even after they add their own internal CFO. “We’re business advisers for them,” he says. “We build a pretty good relationship with the business owner.

We’re still outside people that are giving them great advice.”

Fighting brain drain

This has been going on for a while, but there has been massive growth recently, as hiring has gotten more difficult and expensive.

“It’s really picked up this year,” Sedacca says. “There’s always been some fractional, but it seems like there are more and more in every area of the business.”

John Arms, a fractional marketing executive himself and co-founder of Voyageur University, which helps educate fractional workers on how to build their businesses, says there are multiple reasons.

On one side, experienced executives, whether by choice or force, are leaving the corporate world and, instead of finding new jobs, are going out on their own.

On the other, small- and medium-sized businesses are realizing as they grow that they need more experienced help in various areas of their company but aren’t ready to hire someone full time.

“Companies, as they adjust to all their HR issues, they’re flocking to it,” he says. “It’s cheaper. ‘I can get seasoned talent for a lot less.’ That’s definitely part of it.”

The “Great Resignation” is also having an impact.

Companies have lost talent they need to replace but can’t with full-time help.

“It wasn’t the young ones,” Arms says. “It was [people] over 45. So, there is a little bit of brain drain coming out of full-time work and going independent. They know they can’t claw those brains back in a full-time role, but they need the wisdom.”

It started with CFOs, moved into CMO roles and now, the biggest right now, Arms says, is chief operating officers. But depending on the experience brought by owners and management teams, he adds, there are fractional employees available for every position in a C-suite.

Companies considering hiring fractionally should start with a deep look at their budget to make sure they get the best bang for their dollars. Does it make sense to hire an inexperienced person for a role when, for a similar price, you can get guidance in a part-time role from someone who has been around for 30 years?

“A young person who is cheap doesn’t know what a seasoned person does,” Arms says. “You can have that

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FEATURE “It became evident that even at the senior levels, there were differing opinions on HR. We knew right away that having some HR expertise or some outside perspective was really important.”

— Todd Williams Fidelity Bank

guidance, that brain that’s been around 30 years and apply it to your price model.”

Companies that do hire fractional executives, Arms adds, do need to be prepared to be informed of what is best for their company.

“Be ready to be told what to do,” he says, adding that part of the upside of bringing in seasoned talent is the experience they bring. “They are there to educate you on what you are missing or what you are not doing.”

Know where your business is at

When Jennifer Zick started Authentic Brand, she wasn’t familiar with the use of fractional executives, but knew she’d be excited to help small businesses do better marketing while wasting fewer resources. The problem is those businesses often don’t have someone on staff dedicated to marketing — which, she quips, leads to a lot of poorly executed “random acts of marketing.”

“In most organizations that marketing true executive role is the last seat filled in the executive table,” she says. “Most companies start out as founder led, sales driven. The first leadership roles they fill are finance and operations because they have to run a business and make revenue happen.”

Zick was among the first to start offering fractional marketing services. Much like in finance, operations and HR, fractional marketing is taking off, whether it is with independent chief marketing officers who offer services to multiple clients or advertising agencies that have begun offering the service as an add-on to existing services, Zick says.

All Authentic Brand consultants are W2 employees who follow its established methodology. The company provides benefits, technology and sales and marketing, doing business development so those CMOs “can spend their time doing what they do best,” she says.

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CMOs generally cost, she says, between $150 and $350 an hour. Authentic Brand offers flat rate structure though she doesn’t consider the company a low-cost alternative. It works with small businesses with between $5 million and $100 million in revenue across all industries. Most are entrepreneurial growth businesses that have never had head of marketing.

“We work inside the company on a long-term contract basis to build strong teams and programs,” she says, adding that most engagements are for between 12 to 20 hours a week and they usually take two years or more.

That said, Zick says, the company does not embed CMOs within companies that are smaller than $5 million.

“For a lot of earlier stage small growth businesses, having a CMO, at any level, either fractional or fulltime, would be overkill,” she says. “A CMO seat even fractionally is a six-figure investment backed by a sixto seven-figures of marketing spend they are helping to lead and guide and hire. It’s no small investment.”

The company does like helping small businesses grow. For companies approaching $5 million, Zick says Authentic Brand offers coaching rather than an embedded CEO. Or, for smaller companies, it will put them in touch with a collection of allies, be they freelancers or small agencies, “who are ninjas of marketing execution,” she says, adding that those companies have specialists who can help with any marketing issue that might come up.

“Any business of any size can reach out to Authentic Brand and say, ‘This is the pain we are having, how would you suggest we move forward.’ Usually there is a provider in our network that is the next right step for them.”

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catching up

by Andrew Tellijohn

Discover Strength discovered franchising for its next round of growth

JONATHAN HANKIN

W

hen Luke Carlson spoke to Upsize in 2017 about Discover Strength, his strength training company was generating the highest revenue per square foot of any fitness concept in North America through its three Twin Citiesbased locations.

After surviving — perhaps even thriving — during the COVID-19 pandemic, at least as it compares with the average big box gym, Discover Strength is ready to start expanding its footprint, both in Minnesota and beyond.

One difference between now and the last time we spoke is the growth strategy. As often happens with Carlson, an avid reader, his current plan was inspired by a book: “Franchise Your Business,” by Mark Siebert, CEO of iFranchise Group.

“I was 30 percent of the way into the book and I thought ‘This is inevitable, we’re going to franchise,’” Carlson says. “The book spoke to me so much.

It was wonderfully written. I was totally inspired and knew that was the direction we needed to move.”

So, Carlson hired iFranchise Group to help work through the details.

The company has opened its first two franchise locations in Wayzata and Maple Grove and recently awarded two more, in Eden Prairie and Rochester.

Part of the future growth plan is set. The intention is to expand going forward at between 70 and 80 percent franchise-owned locations, with more 22

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Discover Strength, founded by Luke Carlson, will expand at between 70 and 80 percent franchised locations going forward.

than 70 expected to open in the next few years. Carlson does intend to increase his corporate-owned store count from six to 12 during that time.

“We want to keep opening our own locations because we want to make sure those locations can serve as the model to

the rest of the franchise system for ‘this is the standard, this is where we should be in terms of performance in all areas of the business,’” he says.

There’s also the desire, Carlson says, to keep some skin in the game and to continue generating profits that help with the franchising plans.

“Our corporate locations are very profitable and they allow us to finance or fund our franchise growth,” he says. “It’s for those reasons we continue to do it.”

Another part of the plan is still fluid. www.upsizemag.com

JONATHAN HANKIN

Where the next round of locations will open, for example, is not set in stone, though it will make sense geographically.

The company, Carlson says, has received interest from prospective partners across the U.S. and in other countries. But for now, geography and the ability to communicate easily with franchisees will play a role.

“That’s the stuff we’re working on,” he says. “It comes down to our philosophy on support. It’s one thing to launch a franchise, it’s another to be able to have the home office support that franchise. …

That’s part of the value proposition to the franchisee.”

Additionally, he says, those who buy franchise rights are currently only being allowed to open one location. That could change, depending on their initial success, their resources and desires.

“Of our current franchisees, they all one at a time and demonstrating success want to do multiple units,” he says. “We with their first unit before they are comjust want to make sure they are taking it mitted to multiple units.”

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Staying within the niche One thing that has not changed in the last five years is Carlson’s adherence to the company’s niche. He told Upsize in 2017 that his company wanted to be in personalized strength training what Victoria’s Secret is in the area of women’s intimate apparel.

“Bras and underwear — that’s all they do,” he said at the time. “People walk away from the Macy’s and Nordstrom and J.C. Penney and Sears and all the department stores and go to Victoria’s Secret. … We want the same thing — those large health clubs can still exist, but when you think of strength training, in our market, you only think about Discover Strength.”

If anything, after two years of pandemicdriven upheaval to the market, he feels more strongly today. When Discover Strength had to shut down for four months in 2020, Carlson spent time pondering whether he could still serve his customers in that strength training niche or if he had to change the model. Ultimately, the com-

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PHOTOS THIS PAGE COURTESY OF DISCOVER STRENGTH

catching up

Discover Strength

Description: Growing chain of strength training gyms Headquarters: St. Louis Park Founded: 2006 CEO: Luke Carlson Employees: 50 Website: www.discoverstrength.com

pany conducted thousands of sessions a week through laptops and computer screens.

The company’s narrow focus provided a strategic advantage over “big box” fitness centers with many types of equipment and a less focused target market.

“When you understand your strategic niche, you can continue to serve your customers in creative ways,” he says.

“The first thing we thought was how can we provide value for our consumer in our strategic niche. It wasn’t something different than what we always did. … This is exactly what we always did, so it was an easy transition for us.”

Reading and learning Carlson has always loved learning, whether through meeting new people or reading books. At 23, he never intended to be running his own company. At the time, he was a recent college graduate with a

background in kinesiology and exercise science and he was an assistant trainer for the Minnesota Vikings.

It wasn’t until a friend recommended he look into starting a strength training boutique health club with a laser focus on the science of exercise that he first considered Discover Strength.

The idea for a one-on-one or smallgroup-training gym was in keeping with the societal trend away from shopping for everything at Dayton’s and he thought he could take the niche to fitness.

As Discover Strength emerges from the pandemic ready to undergo significant growth, he’s proud to have stuck to his guns. “The pandemic allowed us to live out our purpose, our core values,” he says.

His desire to maintain a quality, focused concept through the recent difficult times, he believes, will benefit the company over the long haul.

“There’s been a collective lowering of the bar. We’re very intentional about ‘we want to raise the bar,’” Carlson says. “It’s better for our customers. It’s better for recruiting staff. There are employees out there, staff out there, professionals out there, who say ‘I don’t want to be part of the lowering of the bar.’ They are going to be attracted to organizations that are consciously keeping the bar elevated. We think it’s really advantageous from a recruiting standpoint.”

“ We want to keep opening our own locations because we want to make sure those locations can serve as the model to the rest of the franchise system for ‘this is the standard, this is where we should be in terms of performance in all areas of the business.’”

Luke Carlson

Discover Strength

Contact: Luke Carlson is founder and CEO of Discover Strength: 763.546.1628; luke@discoverstregnth.com; www.discoverstrength.com; in/luke-carlson-9769816.

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Thinking about buying or selling a business? Sunbelt is the world’s largest seller of private companies. We work with business owners to help them understand the current value of their business and how to maximize their net proceeds at the time of sale.

Sunbelt will provide business owners with a completely confidential, no-obligation value range.

Tom is a commercial photographer who has been helping businesses tell their unique story with photographs for websites and marketing materials since 2006. Tom works closely with his clients to understand their business and branding strategy and creates images that support their mission and success.

BANK Highland Bank

CFO SERVICES Integrated Consulting

COMPUTER CONSULTING Intertech

Rick Wall, CEO | 952.858.4753 Troy Rosenbrook, President | 952.858.4810 952.858.4888 | www.highland.bank

Cathy Sedacca, managing director 612-802-1784 (c) Cathy.Sedacca@integrated-consulting.net www.integrated-consulting.net

1575 Thomas Center Drive • Eagan, MN 55122 www.intertech.com • Ryan McCabe at rmccabe@intertech.com or 651.288.7000

Founded in 1943, Highland Bank is focused on business lending and is an SBA “Preferred” Lender, making us uniquely qualified to help your business obtain the financing it needs expeditiously. Work directly with the decision-makers who will treat you like a business partner. Member FDIC.

Integrated Consulting delivers Chief Financial Officers to small businesses on a fractional basis. From projections to cash flow tools to assistance with all things financial. We provide 30 years of expertise on a small business budget.

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Intertech consultants are leading software developers who focus on more than simply “heads down” programming. We provide comprehensive software services – consulting, project delivery and mentoring – for all leading technologies, most notably Java, .NET and mobile. Intertech consultants are highly experienced and among the IT industry’s top contributors at conferences, technology journals and user groups.

EXIT STRATEGIES Exit Planning Institute Twin Cities Metro Area chapter 763-208-9119 exit-planning-institute.org Jessica Hawthorne, Administrator admin@e-officeconnection.com

Show Content • Best Practices to Grow Enterprise Value • Business Owners Share their Exit Stories • Learn what it takes to exit on your terms!

• Guests share need-to-know advice for lucrative outcomes • Episodes are all under 30 minutes Subscribe on Apple, Spotify, Google, iHeart, Stitcher

Sponsorship Opportunities!

Download episodes and order the book! https://www.poisedforexit.com/ www.upsizemag.com

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Through the Certified Exit Planning Advisor (CEPA) credential, the Exit Planning Institute provides professional advisors with the content, tools, and training needed to gain more access to business owners, strengthen relationships, and become the most valued advisor.

LAW FIRM Winthrop & Weinstine, P.A. Capella Tower, Suite 3500 225 S. Sixth St. • Minneapolis, MN 55402 Tel: 612.604.6400 • www.winthrop.com Winthrop & Weinstine is a business with a deliberate culture of enterprise and fresh thinking. Our clients have big ideas, and our lawyers help turn those ideas into successful businesses. We represent clients in the early stages of their business in matters such as entity formation, capital raising, employment matters, vendor and customer agreements, and others. We provide counseling as your business grows, and work closely with clients to smooth the path to success.

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UPSIZE RESOURCE DIRECTORY HUMAN RESOURCES Optima HR Solutions

MERGERS & ACQUISITIONS Lingate Financial Group

SBA LENDER Highland Bank

Steve Schad, sschad@OptimaAdvisoryllc.com Ph: 651.587.0588 www.OptimaAdvisoryllc.com

7575 Golden Valley Road, Suite 100 Minneapolis, MN 55427 763-546-8201 www.Lingate.com Greg Loeschke — Managing Principal

Troy Rosenbrook, President | 952.858.4810 Kim Storey, SBA Lending Manager | 952.858.4590 952.858.4888 | www.highland.bank

Attracting and retaining the right people will fuel your growth. Take the guesswork and headache out of the people side of your business with help from Optima HR Solutions. Smart HR will get you to the next level - assessment, strategy, fractional HR leadership, and tactical HR support and recruiting.

Founded in 1945, Lingate Financial Group is a leading provider of lower middle market merger & acquisition advisory services, representing privately held businesses of all types with revenues of $5 – 50 million. Lingate helps business owners with market-based valuations, business sales, mergers, acquisitions, recapitalizations, and internal transitions among family members, partners and management.

We get deals done.

Founded in 1943, Highland Bank is focused on small business lending and is an SBA “Preferred” Lender, making us uniquely qualified to help your business obtain the financing it needs expeditiously. Work directly with the decision-makers who will treat you like a business partner. Member FDIC.

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LEADERSHIP DEVELOPMENT Prouty Project

PUBLIC RELATIONS Bellmont Partners

SBA LENDER 21st Century Bank

6385 Old Shady Oak Road, Suite 260 Eden Prairie, MN 55344 952.942.2922 | www.proutyproject.com Kari Baltzer | stretch@proutyproject.com

3300 Edinborough Way, Suite 700 Edina, MN 55435 Brian Bellmont, President 612-255-1111, info@bellmontpartners.com www.bellmontpartners.com

2335 Highway 36 W Suite 202 Roseville, MN 55113 612-372-2178 • www.21stcb.com

Our leadership development engagements and cohort-based leadership programs – Prouty L3 and Prouty i•will – link behavior to team performance in your workplace through the lenses of Leading Self, Leading Others and Leading the Business.

We focus on STRETCHing participants to lead business within internal and international divisions. Give us a call or stop by.

Bellmont Partners helps growth-focused Minnesota organizations solve complex challenges. Our experienced communications strategists generate results that build brands, drive engagement and support business objectives.

SBA LENDER Sunrise Banks

GROW OR DIE

David Reiling, CEO Phone: 651.265.5600 www.sunrisebanks.com Sunrise is headquartered in St. Paul, MN, and has four retail banking branches located in the urban core of Minneapolis and St. Paul. Its primary business lines include: Commercial Lending and Leasing, Relationship Banking, Treasury Management, Prepaid Cards, Fintech Partnerships, New Markets Tax Credits, and Small Business Administration Lending.

Move your business forward with investment capital generation, deep-level network connections and strategic refinement consultation from Brimacomb and Associates. We partner with emerging companies and professional services firms to offer unparalleled access to professional resources, executive suites and financing sources.

Member FDIC

STRATEGIC PLANNING Prouty Project 6385 Old Shady Oak Road, Suite 260 Eden Prairie, MN 55344 952.942.2922 | www.proutyproject.com Kari Baltzer | stretch@proutyproject.com We start with a blank sheet of paper to elevate your clarity on vision and purpose, create alignment in your strategy to achieve your vision and gain commitment to execute. What are your “market, product/service, people, and financial” strategies over the next 1-5 years?

Can you articulate your strategic plan on one page?

Join us in our Creative Think Tank to stretch your thinking and ignite your creativity.

www.brimacomb.com 612.803.3169 • rick@brimacomb.com

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At 21st Century Bank, we know what it takes for businesses to survive, grow, and prosper in today’s market. For over 100 years, we have been your community partner. A family-owned bank, with expertise in all SBA and conventional lending programs covering all stages of your business. We tailor solutions that respond to your unique business and banking needs.

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UPSIZE RESOURCE DIRECTORY TRANSITION PLANNING KeyeStrategies

WEALTH MANAGEMENT JNBA Financial Advisors

Minneapolis, MN Keyestrategies.com 763-350-5563 Julie Keyes, Founder/CEPA

8500 Normandale Lake Blvd., Suite 450 Minneapolis, MN 55437 952.844.0995 www.jnba.com Cärin Viertel, Director of Client Services

“KeyeStrategies LLC advises business owners in Transition and Exit Planning. Julie Keyes is both a Certified Exit Planning Adviser (CEPA) and Value Growth Adviser. She is also a faculty member for the Exit Planning Institute’s Global organization and President of its local Chapter.”

Being a small business we understand the needs of small business owners. And with 40+ years of experience in providing conflict-free advice, our proactive and integrated approach allows our multi-generational teams to put clients first when delivering customized financial life planning and investment strategies to help maximize their resources.

venture capital Brimacomb + Associates

WORKPLACE WELLBEING R3 Continuum

TCF Tower, Suite #1600, 121 South Eighth St., Minneapolis, MN 55402 612-803-3169 * www.brimacomb.com Rick Brimacomb, rick@brimacomb.com Chief Strategy and Relationship Officer

7825 Washington Ave. S., Suite 500 Bloomington, MN 55439 R3c.com 866-927-0184 toll free

Results-oriented advisory firm with unparalleled access to executive suites and financing sources. Emerging companies and established professional services firms rely on our depth of knowledge and deep-network connections to grow client lists, assemble project resources and secure new sources of funding.

R3 Continuum (R3c) is a global leader in workplace behavioral health, crisis, and security solutions. We help enhance workplace behavioral health and performance, speed recovery from disruption, and maintain safety and security on all levels, with our best-practice, human-centered, and technology-enabled continuum of solutions.

EXIT PLANNING: Directing the Process!

Have you determined: When you want to leave your business?

To whom you want to transfer your business?

What your business is worth?

How “Inside Buyers” are going to finance a purchase?

Your “back up” plan should the unexpected happen?

e. drh@exitplanstrategies.com w. www.exitplanstrategies.com p. 651 426 0848

SUBSCRIBE TO THE DIGITAL EDITION OF UPSIZE MINNESOTA

UPSIZE MINNESOTA is your source for the advice you need to help grow your business. By signing up for your FREE DIGITAL SUBSCRIPTION to Upsize, you will receive how-to advice six times a year in a full-page, easy-to-read format, complete with active links to relevant service providers and experts.

Follow this link to receive your FREE DIGITAL SUBSCRIPTION: bit.ly/3tBoCAV www.upsizemag.com

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MAY • JUNE 2022 UPSIZE

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BACK PAGE DiLeo on branding: Less talk, more listening

by Andrew Tellijohn

K

ate DiLeo bills herself as an accidental brand strategist who intended to get her PhD in anthropology. She discovered the power of branding during her first sales job and turned it into a career, starting her own company: Kate DiLeo Branding.

She’s adding author to her list of titles this summer when her book, “Muting the Megaphone,” comes out.

It’s aimed at getting companies to talk a little less and listen a little more.

DiLeo joined Upsize Editor Andy Tellijohn to talk a bit about what people will learn from her writing.

Tellijohn: What mistakes do you see businesses make in their brandbuilding efforts?

DiLeo: Today’s digital economy has turned us into bullish broadcasters.

We shout as if we hold a megaphone in our hands, blasting a multitude of messages, hoping to catch our prospects’ attention — special offers, explainer videos, case studies and white papers and sales funnels galore.

Equally, we are inundated with messages that yell right back. We find ourselves helpless to the surrounding noise, hoping we could turn down the volume on the cacophony of daily narratives.

We have become deaf and desperate. We somehow fear that if our story isn’t shared or heard, no one will see value in who we are or what we’re offering. All this noise is in the name of storytelling.

Tellijohn: Is there a role for storytelling?

DiLeo: We sell storytelling as the 28

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quintessential marketing tactic, and companies spend thousands of dollars trying to craft stories they hope will compel their customers to buy.

Storytelling and branding have become synonymous in today’s economy. We naively believe that the power of branding lies in the story’s power.

The problem with storytelling is that it is a one-way monologue. You talk while your audience listens. No matter how compelling you believe your brand story to be, it still doesn’t allow your

Muting the Megaphone, about using conversation rather than storytelling in building a brand, comes out in July.

All this is in the name of storytelling.

How ignorant and how egotistical.

Kate DiLeo stumbled onto branding while intending to get her PhD in anthropolgy. She says companies do too much talking and not enough listening during brand-building efforts.

audience to respond or engage. Even if we have the best intentions to make the customer the heart of our story, it is a story we have written about us. And, when we are on the other side of someone telling us their brand story, we wish they would stop spinning prose, get to the point, and take a breath so we can get in a word somewhere.

Tellijohn: What is the better way?

DiLeo: The solution is simple. If we want our target audiences to listen, engage and eventually buy, we must stop telling brand stories and start having brand conversations. Because when you stop telling stories and start having conversations, you allow your brand to be the path of least resistance to revenue. Brands that engage in genuine conversations have the power to provoke your target audiences to want to come to the table, build the relationship and ultimately buy.

Tellijohn: Where can people get a copy of the book?

DiLeo: Visit www.katedileo.com Contact: Kate DiLeo owns Kate DiLeo Branding: www.katedileo.com; in/katedileo.

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Small business financing made for your big business dreams

"We pride ourselves on relationships we have cultivated with our existing customers and feel honored by the strength of our referral networks,” says Bank President Jon Dolphin. “Our team of financial experts serves this community by offering “big bank” products with a tailored approach and hometown service.”

For over 100 years, we have been your locally owned and operated community bank, consistently ranked as a Top 10 SBA Preferred Lender in Minnesota on SBA 7(a) & 504 loan programs.

We are here for you every step of the way.

Ham Lake I Rogers I Loretto I Blaine I Minneapolis I Lexington I Lilydale I Roseville 21stcb.com

This is a great time to list your business for sale It continues to be a seller’s market. If you’ve ever considered selling your business, now is a great time to better understand what your business is worth.

Get a free, confidential value range analysis started today.

Easy. Confidential. No obligation.

Contact this Sunbelt Business Advisor team today.

Peggy Demuse

Lisa Meyer

Business Broker

Business Broker

Cell: 612-730-8921 Direct number: 651-288-1627 email: pdemuse@sunbeltmidwest.com

Cell: 612-801-2299 Direct number: 612-361-4918 email: lmeyer@sunbeltmidwest.com

Minnesota’s Largest Seller of Companies Office Address: 1300 Godward St. NE, Suite 6000 | Minneapolis, MN 55413