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Every dollar your business makes, you have to place. Reinvest it, pull it out, or move it somewhere that holds its value. And that decision sits on a base layer most owners never see. The same three-statement math that runs your company runs the whole world, with one difference. Governments can print. That worked for 50 years because the US forced the world to buy oil in dollars, keeping the system afloat. That era is ending now: the Strait of Hormuz, supply chains breaking, a world that no longer wants the dollar or its bonds. Tom Walker came back on to walk through what it means, and it ends in more printing. More printing means more inflation, and inflation is what quietly decides whether you reinvest in your business or move into hard assets that protect what you've built. You don't control the base layer. But once you see how it works, you make that call with your eyes open instead of on gut.

Tom Walker, Jr. is an economist and CFO who runs Walker Insight, the Minneapolis firm his father started in 1975 to bring real financial planning to independent farmers. Tom Jr. joined in 1989, and for decades he's built custom planning models for farms, food processors, and manufacturers, fusing economics, finance, and production so owners can weigh risk, prove a concept, secure financing, and track progress against their goals. He's a returning guest (first on Ep. 415, "Everyone Gets Punched in the Face"). His lens hasn't changed: you don't plan to predict the future, you plan to build a framework that survives the hit.

Top 10 Takeaways

• You can't make a good ownership decision blind to how the game works. Learn the board first.

• Your business is a closed loop. Cash in, cash out, no printer.

• The government runs the same three statements you do. The only difference is it can print.

• Cash flow is the only honest scorecard. Every valuation is a bet on future cash flow.

• Paper wealth and cash wealth are different games. A marked-up asset is worth what someone pays.

• An asset that won't cash flow for a new buyer is a bet on the next buyer. Know the bet you're making.

• New money reaches the connected first. Know where you sit before you plan around it.

• The market gets propped because it has to be. Read the signal, not the headline number.

• Liquidity is optionality. Stay liquid and you get to decide instead of getting forced.

• See the game clearly, price on cash flow, and you decide on purpose instead of on gut.

Chapters:

(00:00) Introduction of Tom Walker, Jr., economist and CFO at Walker Insight

(01:03) Macro sanity checks: Lyn Alden, Luke Gromen, and Larry Lepard

(04:43) Your business is a closed loop — cash in, cash out, no printer

(14:12) Farming as a microcosm: no soft landing, fiat conditions on the ground

(29:50) The Cantillon Effect: new money reaches the connected first

(38:39) Advice for owners and farmers navigating fiscal dominance

(55:09) How fragile the system really is — 4% breaks the whole thing

(01:09:10) Supply chain risk, locking in inputs, and who actually survives

(01:25:23) Own the outcome: finding the right guide without outsourcing your freedom

(01:31:14) Stay solvent to be right eventually — the Noah's Ark framework

This episode was produced by Castos Productions.

Resources:

Walker Insight — https://www.walkerinsight.com/
Tom Walker on LinkedIn — https://www.linkedin.com/in/thomaswalk...

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You've got one person you can't afford to lose, running an outcome you know you can't hit alone. They've started asking about the upside, and your gut says give them a piece of the company. Then you remember what real equity costs. A K-1 every April. A cap table. Permission required to sell your own business.

Kim and I get into phantom stock: real money tied to real valuation growth, without putting anyone on your cap table. It's a contract and a balance sheet liability, pegged to the same four numbers every valuation already runs on. The catch is, there's no shortcut here, unlike on the annual plan. Build the owner's goals, the valuation, and the five-year model first, or you've got it backwards.

We get into the one honest test for whether someone earned it at all (can you hit the five-year number without them?), Why you never tie the payout to a sale, and the worked example where sharing 5% of a $21.01M outcome costs you nothing, because it never existed without the person who earned it.

Top 10 Takeaways

• A salary rents someone's effort. Long-term comp ties them to the value you build together.

• The one honest test: if you can hit your five-year number without this person, don't grant phantom stock. Go hire someone who wants a salary.

• There's no shortcut on a long-term plan. Build the model, the valuation, and the five-year forecast first, or you have it backwards.

• Phantom stock is a contract and a balance sheet liability. No cap table, no K-1, no operating agreement.

• Real equity ropes you together on taxes, distributions, and the decision to sell. Phantom stock doesn't.

• Never tie the payout to a sale. Do that and your executives start needing you to sell.

• Peg it to a cash flow valuation, not the private equity premium someone might pay someday.

• Have a neutral third party value the company every year. Ten to fifteen grand ends the argument before it starts.

• Size it like a budget. Percentages first, then meaningful dollars, then what the company can actually afford.

• The math is the hard part. Once it's clear, the attorney's contract is about three grand.

Chapters:

(00:00) Introduction: Ryan and Kim on sharing company upside without equity

(02:20) A salary rents someone's effort; long-term comp ties them to value

(04:05) What usually goes wrong without a long-term strategy in place

(06:11) No shortcut: build the model, valuation, and five-year forecast first

(13:15) Phantom stock: a balance sheet liability, no cap table, no K-1

(19:40) The one honest test: can you hit the five-year number without them?

(41:00) Never tie the payout to a sale; executives will need you to sell

(47:29) Peg it to a cash flow valuation, not the private equity premium

(56:24) Have a neutral third party value the company; ten to fifteen grand ends the argument

(1:02:09) ESOPs, SARs, and creative layered approaches to ownership transitions

This episode was produced by Castos Productions.

Resources:

Executive Comp Workshop June 25 – 9 AM - 11am CST – Virtual, Live, Interactive: https://ryantansom.com/the-compensation-blueprint-workshop

90-Day Boardroom Blueprint Ryan's onboarding program that walks owners through the IBD Ownership OS, three-statement financial model, budget, and forecast — the foundation required before designing any executive comp plan.

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You're paying highly paid people to take problems off your plate. Instead they're handing you back monkeys, drama, and a deal you end up pricing yourself. Sales and Operations are at war over what got sold and what can actually be delivered. Finance is caught in the middle. You're the referee. You're not bad at this. The comp plan is. Each leader gets paid on their own win, so winning at a peer's expense pays, and the monkeys land back on your desk by the end of the day.

In this episode I walk you through the annual executive comp plan I installed at my family's business and have put in with clients since. The move is to tie your top leaders to each other through the income statement and to your ownership goals at the same time. Half of their variable rides on their own seat. A quarter rides on each peer. Now winning at a peer's expense stops paying. Now the monkeys stay where they belong. Now you get to do the work only you can do, the strategic, the big, the broken things that are actually interesting to you. Kim and I get into the bonus pool sized top-down off normalized net operating income so it's always affordable, the multipliers that run both directions, and why one of our clients ran the math and decided not to hire the $500,000 CEO he was about to go find. He wanted the seat back. The seat got worth wanting again.

Top 10 Takeaways

• You're paying highly paid people to take problems off your plate. They're handing you back monkeys.

• The drama isn't your team. It's the comp plan paying each of them only on their own win.

• Tie your top leaders to each other through the income statement. Three buckets, three seats: revenue, margins, SG&A and cash.

• The 50/25/25 model ropes them together. Half their variable on their own seat, a quarter on each peer's.

• Now winning at a peer's expense stops paying. The monkeys stay where they belong.

• Comp each executive on numbers they actually control. Not on a peer's leadership growth.

• Size the bonus pool top-down. A fixed slice of normalized net operating income. Bottom-up reconciles to it.

• Run multipliers on every seat. 1.1x to 1.2x up, 0.8x to 0.7x down, with a floor where the piece stops paying.

• The company's cash flow and your ownership goals set what comp is affordable. Title doesn't. Wish doesn't.

• Get the comp right and you get the work back: the strategic, the big, the broken things only you can do.

Chapters:

(00:00) Ryan and Kim on designing the annual executive comp plan

(02:33) The drama isn't your team — it's the comp plan paying on their own win

(03:21) The 50/25/25 model: tying top leaders to each other through the income statement

(10:30) Size the bonus pool top-down off normalized net operating income

(12:20) Cash flow and ownership goals set what comp is affordable — title doesn't

(18:00) Comp each executive on numbers they actually control, not a peer's growth

(20:43) Total inversion: monkeys stay where they belong, you get the work back

(21:06) Run multipliers on every seat: 1.1x up, 0.8x down, with a floor

(53:46) Fractional leaders: can they actually own the outcome of the seat

(1:05:20) You've got to do the work — comp grounded in data, goals, and financials

This episode was produced by Castos Productions.

Resources:

Executive Comp Workshop June 25 – 9 AM - 11am CST – Virtual, Live, Interactive: https://ryantansom.com/the-compen...

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This is the kickoff of a multi-episode arc on Module 8 (Executive Compensation) of the iBD Ownership OS. Kim Clark, iBD's CRO and business partner, runs the interview; she spent years designing sales and revenue comp at ITR Economics before joining iBD. Module 8 is Ryan's territory, so the format flips: Kim asks, Ryan teaches the system. The next two episodes go deeper on short-term incentive design (annual exec bonuses, cascade math, KPI architecture) and long-term phantom stock mechanics (vesting, valuation triggers, the M9 transition bridge). The companion workshop where you actually build your own plan is June 25, 2026.

You have a $40,000 executive comp plan sitting on your desk and you don't know if it's the right one. Your insurance broker pitched it. Your attorney drafted it. Your HR person was distracted. And it's tied to absolutely nothing that matters. The first call I had with that client, he asked me, "Should I sign this?" I asked back: What's your five-year valuation target? Cash flow goals? Do you have a financial model? Three nos in a row. That's where most owners are. Comp gets treated as an HR motivation problem when it's actually a capital allocation decision that has to trickle down from the owner's goals.

Kim and I open Module 8 with the reframe and the cascade: why this module only works after Modules 1 through 7 are installed, why normalized net operating income beats gross profit and net income for the bonus pool, what 10% of NOI looks like split across the executive team and the company, and why phantom stock does most of what real equity does without putting anyone on your cap table. When the goals are clear and the rules are clear, the executive team runs the field. When subjectivity rules, everyone is just guessing.

Top 10 Takeaways

1. Your comp plan keeps failing because you're paying people on outcomes they can't control.
2. Comp tied to gut feel breeds resentment, not productivity. The exact opposite of what you wanted.
3. Comp design starts with the owner. Not HR. Not your attorney. Not the insurance broker pitching annuities.
4. You can't build a comp plan without a five-year valuation target and a financial model in front of you.
5. Hiring a CFO before your model exists? Tie their first bonus to building the model.
6. Comp is a capital allocation decision, not a motivation problem. You're sharing future cash flow.
7. Normalized net operating income beats gross profit because a CRO can crush GP and crater operations by overhiring.
8. Your bonus pool is 10% of normalized NOI. Everything else is just how you split it.
9. Phantom stock is a legal contract and a real liability on the balance sheet. No cap table, no K-1.
10. When the goals are clear and the rules are clear, the executive team runs the field. Subjectivity is exhausting.

Chapters:
(00:00) Introduction to Module 8: executive compensation and why it exists
(01:46) Your comp plan keeps failing because you're paying on outcomes they can't control
(04:15) Comp tied to gut feel breeds resentment, not productivity
(07:21) Comp design starts with the owner, not HR, your attorney, or the insurance broker
(10:38) Why this module only works after Modules 1 through 7 are installed
(16:24) Comp is a capital allocation decision, not a motivation problem
(19:25) Normalized NOI beats gross profit and net income for the bonus pool
(26:20) Your bonus pool is 10% of normalized NOI — here's how you split it
(32...

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Most owners stare at the same gross profit number every month and feel good about it, and the chart underneath it is telling a completely different story. Revenue is up. Gross profit dollars are up. You feel good for about ten seconds. Then you notice the gross margin percentage is creeping the wrong way and you don't know if it matters. Your CPA does taxes. Your banker manages the line. Nobody is sitting at the chart with you asking the next question.

That next question is what this episode is for. We get into how to read the gross margin chart by product line, where to set the floor that triggers the boardroom conversation, what the rate of change is actually telling you before the trend shows up in cash, and how the same chart asks one question if you're wearing the COO hat and a completely different one if you're wearing the owner hat. The owner question is where most operators get stuck, because almost nobody runs the seats separately. Real example from my old copier business, real numbers from the case study, and the honest version of how messy it is to get your data clean enough to actually believe.

1. Your three financial statements are a closed loop, and every operating decision ripples through all three.
2. Without a five-year plan, every margin decision is made in a vacuum.
3. Gross profit can grow every year while gross margins quietly shrink.
4. The blended company gross margin hides the line that's bleeding by averaging it with the line that's healthy.
5. Rates of change are your early warning system, before the trend shows up in cash.
6. If costs and revenue don't land in the same month, your gross margin is fiction.
7. Every product line needs a target margin and a floor, and the floor triggers the boardroom conversation.
8. Gross profit grew because you sold more, or because your margins expanded, and the split tells you whether the year was real.
9. The gross margin chart you're looking at this month is the input to your distribution next December.
10. The COO seat asks how to operate around the margin, and the owner seat asks what to do with the cash it produces.

Chapters:
(00:00) Three financial statements are a closed loop; every decision ripples through all three

(03:00) Without a five-year plan, every margin decision is made in a vacuum

(07:30) Gross profit can grow every year while gross margins quietly shrink

(11:00) Rates of change are your early warning system before the trend shows up in cash

(12:30) If costs and revenue don't land in the same month, your gross margin is fiction

(19:30) The blended gross margin hides the line that's bleeding

(26:30) Every product line needs a target, a floor, and the floor triggers the boardroom conversation

(35:00) The split tells you whether the year was real: revenue growth or margin expansion

(43:00) The gross margin chart this month is the input to your distribution next December

(49:00) The COO seat asks how to operate; the owner seat asks what to do with the cash

This episode was produced by Castos Productions.

Resources:

Boardroom Blueprint — The 90-day program where Ryan walks owners through installing the financial model, business valuation, and iBD Ownership OS™. — ryantansom.com/coaching

Ep. 487 — Casey Brown: Th...

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"I want the seller to level with me. I don't want to be his priest or pastor, but I want honesty, and I don't want any surprises down the road." - Bud Martin,

Bud Martin once watched a son kill his parents' deal by telling every buyer tour the company would never make it without him. I told Bud I was 27 when we sold our family business — and I knew I could have done the same thing. I almost did. That story is the human core under every M&A advisory conversation we don't talk about enough. Bud Martin runs controlled auctions for businesses in the $1M-$3M EBITDA range — a no man's land for owners. Too complex for brokers. Too small for the big banks. We get into what a real sell-side process actually looks like at this level, why most lower middle market deals are cash-at-closing strategic bolt-ons (not earnouts), the family dynamic that kills more deals than bad numbers ever will, and the philosophical question I keep coming back to: build a cash-flow business that gives you choices, or chase a third-party strategic deal that maximizes cash at closing. Both work. They're just not the same.

Top 10 Takeaways

• The $1M-$3M EBITDA range is no man's land — too complex for brokers, too small for the big banks, and most owners get the worst sell-side representation right when they need the best.

• A controlled auction is non-negotiable — multiple bidders keep buyers honest, drive pace, and protect your leverage; day 92 close is the goal, day 180 is a red flag.

• Most lower middle market deals are cash at closing because strategic buyers write checks from the balance sheet — no banks involved, faster closes, cleaner deal structures.

• Earnouts in this segment are shifting from financial metrics to integration milestones — one of Bud's current deals is 95% cash, 5% tied to a six-month CRM integration.

• The family dynamic kills more deals than bad numbers — if your partners aren't on the same page before you call a banker, the deal is already dead.

• Build a cash-flow business and you have choices — ESOP, internal transfer, third-party, PE — but if you go straight to a strategic buyer, cash at closing goes through the roof and the cultural trade-offs come with it.

• The buyer who already knows your industry isn't the best buyer — the aligned-industry buyer who wants to be in your space is, because that's where 2+2 = 5 or 6.

• A $3M revenue fire safety business landed a $5 billion publicly-traded buyer because the industry was consolidating and Bud reached out to everyone — including the companies that looked too big.

• Bud gives sellers a conservative valuation so they're surprised on the upside — if the seller isn't in the same area code on number, he walks away from the engagement.
• Geopolitical risk lands on the deal table — a strategic buyer pulled out of one of Bud's deals in February because the Iran situation spooked their backlog and changed the math.

Bud Martin is the founder of M&A Connect, a lower middle market M&A advisory firm based in the Chicago area. William (Bud) Martin has over 20 years of M&A experience. Prior to founding M&A Connect, he was with a highly regarded Midwestern M&A firm and was the leading broker by revenue and transactions closed during his seven years there. Bud has been the lead advisor on dozens of middle market transactions and is a current board member of Dynamic Rubber Inc. near Chicago. Before M&A, Bud owned a contract manufacturer of precision-machined components serving OEMs in aerospace, automotive, and business machine industries. He started his career as a runner on the Chicago Board of Trade and traded options on the...

This interview is about why the old playbook of waiting for certainty is dead, and what owners need to do instead. Alex Chausovsky walks through how supply chain shocks, inflation, and a broken global system are hitting real P&Ls right now — input costs moving, margins under pressure, and customers who may or may not have the money to keep buying. Kim Clark and I then turn it into the owner's next move: three decision vectors (pricing, inventory, supply chain), pricing as an ownership decision — not a sales problem, segment your customers so a 12% increase doesn't blow up your tier-one relationships, and communicate the move in a way that builds trust instead of burning it. Build the battle plan before you need it — because by the time you need it, it's too late to build.

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Top 10 Takeaways

• Stop waiting for clarity and start building scenarios — pricing, inventory, and supply chain are the three decision vectors you stress-test now, not when the crisis hits.
• Every CEO should have a filing cabinet of pre-built scenarios. When the Strait closes, you open the folder. You don't start planning.

• A 2% global disruption is not a 2% hit — Qatar LNG, aluminum, diesel trucking, and fertilizer all chain off the same chokepoint, and the tail kills the whole machine.

• Availability is becoming a bigger moat than price — "I can get it to you when you need it" is worth more than being ten cents cheaper.

• Pricing is an ownership decision, not a sales problem — the math runs through your valuation, distributions, and cash flow, which makes it a boardroom conversation.

• A 12% increase dropped in a week without a "why" reads like collusion; the same 12% broken into transportation, material, and wages lands.

• Don't push uniform pricing across every customer — your Tier 1 relationships can absorb what Tier 2 and below cannot, and segmentation is where the margin gets protected.

• The top 20% drives 60% of US consumption — be honest about whether your customer actually has the money to keep buying what you sell.

• You're not in business to grow revenue — you're in business to make a profit, and that means running your P&L by customer and product line.

• The five-year forecast is the destination — scenario planning is how you course-correct to actually get there when the world gets loud.

Alex Chausovsky is the President of 3DM Consulting. He is a highly experienced market researcher and analyst with more than two decades of expertise across subjects including economics, manufacturing, automation, advanced technology trends, and business cycle analysis. He has consulted and advised companies throughout the US and Canada, Europe, South America, and Asia. Alex has delivered over a thousand presentations, webinars, and workshops to small businesses, trade associations, and Fortune 500 companies across a spectrum of industries, and is the go-to source of industry data and insights for business owners and leaders. Alex's analysis has been featured in the Wall Street Journal, on the BBC, and on NPR, and he is a Top Voice on LinkedIn.

Chapters:
(00:00) Introduction of Alex Chausovsky, President of 3DM Consulting, economist and geopolitical analyst
(03:30) Alex's lens: geopolitics as geography plus leadership personalities driving global policy
(16:00) A 2% disruption is not a 2% hit — Qatar LNG, aluminum, diesel, and fertilizer all chain off the same chokepoint
(24:16) Availability is becoming a bigger moat than price — "I can get it when you need it" beats ten cents cheaper
(28:48) Stop waiting for clarity: every CEO needs a filing cabinet of pre-built...

My protein powder went from $62 to $122. The company's response was a mass email that started with "we understand your frustration." That is exactly how most businesses handle price increases. No plan. No segmentation. Just a surprise and an apology nobody asked for.

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Kim Clark and I sat down to talk about pricing. Not theory. The real conversation that happens when your input costs are moving and you have to decide what to do about it. We started with a protein powder subscription that went from $62 to $122 in a single month with no warning, no communication plan, and a mass apology email nobody asked for. From there we got into why pricing is an ownership decision that runs through valuation, cash flow, and distributions. I walked through the income statement to balance sheet to ownership decision chain the way I do it in a quarterly board meeting.

Kim broke down rates of change analysis on your input costs as the early warning system, the customer segmentation framework for who gets a phone call, who gets a personal email, and who gets the mass communication, and how to give your sales team the "why" and the training to hold the line. We also talked about what is happening right now with the Strait of Hormuz, what that means for supply chains, and why this is different from every other inflationary cycle most of us have lived through.

Top 10 Takeaways

• Pricing is an ownership decision. The math runs through valuation, distributions, and cash flow. That conversation belongs in the boardroom, not with your VP of Sales.

• The Strait of Hormuz is closed right now. Twenty percent of the world's oil and fifty percent of its helium are not flowing. Pull up IMF PortWatch and see for yourself.

• You cannot print molecules. Money printing is one problem. Physical supply chain disruption is a different problem. Both are happening at the same time.

• The boiling frog kills more businesses than the crisis. A container going from $2,500 to $20,000 gets an emergency call. Margins sliding from 43% to 37% over seven months gets ignored.

• Rates of change on your input costs are the early warning system. The 3-month rate leads the 12-month rate. When those diverge, your tire pressure light just came on.

• Build tiered battle plans before you need them. If input costs hit 8%, here is Plan A. If they hit 12%, here is Plan B. Do the math now so you are not doing it in a panic.

• Your salesperson is caught between company pressure, customer pressure, and the fear of losing the deal that pays their mortgage. Without the "why" and the tools, you are sending them into an impossible position.

• Segment your customers before you communicate a price increase. Tier 1 gets a personal visit. Tier 2 gets a personalized email from leadership. Tier 3 gets the mass communication.

• State what is NOT changing before you discuss what IS changing. Casey Brown calls these power statements. Anchor the customer on the value that continues, then explain the adjustment.

• Run at least one full pricing analysis per year and rotate which customer segments get increases. Pricing discipline is a cadence, not a crisis response.
  

Kim Clark- This is a co-hosted episode with Kim Clark, iBD's Chief Revenue Officer. Kim spent years at ITR Economics before joining iBD, and her background in economic forecasting and revenue operations is all over this conversation. Ryan and Kim recorded this as both a standalone episode and an introduction to the Profit War Room workshop (April 27, 2026). The protein powder story that opens the episode came from a real text exchange with Ryan's buddy Michael the week be...