Ken Yager of Newpoint Advisors: 5 Things I Wish Someone Told Me Before I Became A Founder

As part of our interview series called “5 Things I Wish Someone Told Me Before I Became A Founder”, I had the pleasure of interviewing Ken Yager.

Ken Yager is the founder and President of Newpoint Advisors, a financial advisory firm dedicated to improving troubled small businesses. A fierce advocate for capital preservation and saving jobs, Ken regularly takes on profit and loss and risk-management responsibility for cash-constrained companies in growth, leveraged-buyout and turnaround situations. He also has successfully designed and implemented TAME™ and other algorithms and applications dedicated to this space that allow Newpoint to reach small businesses in distress and save thousands of jobs.

Thank you so much for joining us in this interview series! Can you tell us a story about what brought you to this specific career path?

I’ve worked in the financial sector for most of my career. I began by working on Wall Street with large corporations — the complete opposite of the clients I work with now. Early on, I learned about turnaround management, and it really captured my interest. I asked around to find out what I needed to do to get into the industry, which led to me getting an MBA, going into commercial banking to understand credit and then working in auditing for a few years. After I had that experience under my belt, I joined MorrisAnderson as a turnaround consultant. While I was working with bigger companies and bigger values, I became fascinated with the idea of helping smaller companies.

Can you tell us a story about the hard times that you faced when you first started your journey?

Right before starting Newpoint, I attempted to do a turnaround on my own by buying a distressed small business. I purchased the company on Wednesday, and I was told that if I had not purchased the company it was going to close on Thursday. I knew a lot about turnarounds, but as I would soon learn, I didn’t know what I didn’t know. A lot of things ended up going wrong, some of them beyond my control, and I lost the business 14 months later. Since I went into it on my own without any partners or investors and took on a lot of unnecessary risk, it ruined me financially and was an incredibly humiliating, defeating experience.

Where did you get the drive to continue even though things were so hard?

As awful as that experience was, I just couldn’t imagine not working in turnarounds anymore. I thought it over and decided to go back to MorrisAnderson, learn from other people and figure out where I had gone wrong. It was daunting to go back into turnarounds, but I worked really hard, became successful at it and eventually became a partner.

My own experience losing a business motivated me to learn as much as I could so I could help other small businesses facing the same situation. I knew what I was doing, and my company still went belly up. I couldn’t begin to imagine how much harder it would be for the average business owner who knows nothing about crisis and turnarounds. I also learned that there weren’t really any good options for smaller business owners who needed help to turn their organizations around. I came across so many consultants who charged high fees but still didn’t deliver results. And unfortunately, the smartest people in the turnaround space are much too expensive for small businesses.

Small businesses are the backbone of the American economy — they contribute half of the jobs and half of the taxes in our country. I realized it was a major problem that they didn’t have access to affordable, effective professional help when they became distressed, and it motivated me to start Newpoint. Newpoint is all about making sure that small businesses are able to keep people employed and keep sustaining their local communities.

So, how are things going today? How did grit and resilience lead to your eventual success?

I’m incredibly proud of the work we do and how far we’ve come. Since we started 11 years ago, we’ve saved over 12,000 jobs and helped more than 450 small and low-middle market businesses across the country.

The experience of losing my business and facing financial hardship was devastating, but I learned that the one positive thing about hitting rock bottom is that there’s nowhere to go but up. The experience made me so much more resilient and helped fuel my determination to build Newpoint and provide solutions to this underserved part of the market.

Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?

I can say that building Newpoint, which is extraordinarily different from my industry, has required me to shed lots of beliefs I had about turnarounds so that I could grow the company. I have lots of bumps on my forehead from those lessons. And as we’ve gotten bigger as an organization, I’ve had to learn how to let go of my control freak nature, which is a requisite skill in turnarounds. I’ve found it funny to learn that I’m not as comfortable growing an organization as I am turning them around. The lesson I’ve taken away from all of these bumps and bruises is to surround myself with people as passionate as me about Newpoint’s mission, but who also possess a diversity of skills and views. This has softened the blows and reduced the impact of my own ignorance.

What do you think makes your company stand out? Can you share a story?

We are the first and only nationally based turnaround organization that serves as a consistent backstop for small and lower-middle market companies in trouble, and we we’re very dedicated to saving jobs. However, we also stand out for our approach to this work. We completely reengineered the turnaround process so it can be affordable for small businesses. At the start of our work with clients, we provide clear deliverables for a fixed fee and on a fixed timeline so there are no surprise costs later. This approach is the polar opposite of the standard turnaround model.

We also have a unique “laboratory approach” and develop innovative tools and programs to provide our clients with excellent but affordable and consistent services. For example, we developed a novel platform, Turnaround Action Matrix Evaluation (TAME™), which uses a special algorithm that makes sense of financial and operational data. We use this data to pinpoint issues with inconsistent data and come up with time-sensitive solutions that provide specific returns on investment.

Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?

The financial industry can be intense and requires long working hours, so it’s crucial to take time for yourself and have an activity outside of work that helps you recharge. For me, it’s CrossFit. Pre-planning to intentionally get up early in the morning to get a good workout is a great stress reliever and helps me begin my day feeling energized and focused.

None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?

I’m thankful for a whole ladder of people who helped bridge me to my current path, especially Eric Perzant and Tom Goldblatt, who gave me the freedom to start Newpoint. Tom and Eric trusted me with their client, who became Newpoint’s first client. That interaction gave me the courage to leap into the unknown and tackle the mission that is Newpoint. I would also be remiss if I didn’t give thanks to Dan Dooley at Morris-Anderson, who welcomed me back after I had failed earlier in my career. That single act of kindness and open-mindedness gave me the runway to build the skills Newpoint would need to be successful. I am forever grateful to these men and hope that I can pay that forward in my life.

How have you used your success to bring goodness to the world?

Newpoint doesn’t just save jobs, we save the communities that rely on those jobs. Small businesses are the lifeblood of this country, and when they go under, it has a ripple effect across their local communities. In addition to the economic impact and lost jobs, failed businesses weaken community cohesion and identity and discourage entrepreneurial spirit. When we help these businesses course correct and thrive, it helps their local communities thrive as well.

What are your “5 things I wish someone told me before I started leading my company” and why?

1. Subject matter experts are not business scale experts. Just because you’re an expert on a particular niche area, it doesn’t mean you can translate that expertise into scaling a business. For example, while I love spreadsheets, there are better tools out there to accomplish our goals — but you need to be aware of them. For me, that has led to a twisted journey of embracing enterprise software. I’m still learning about how it works and also how you can stub your toe putting these systems in place.
2. Choose your business partners wisely. I had a falling out with my original partner with Newpoint and it taught me that in many ways, choosing a business partner is a lot like choosing a spouse. You’re making a huge commitment together, so it’s essential to pick someone trustworthy, reliable and who’s a team player, and ensure that your goals and values are aligned.
3. Explaining innate or tribal knowledge is hard. I see now why so many professional service firms never scale. Trying to teach others the thousands of small lessons I have learned over decades can be exhausting and frustrating. I have leaned into that as a mission, but I‘m constantly amazed at the knowledge gap and just how much there is to train and manage with my colleagues and our clients.
4. Growing a business is more challenging than you expect. I never would have expected scaling Newpoint to take so long and be so challenging. I was truly so enamored with the idea of what we could do that I didn’t stop to think about what others find interesting or what their priorities were. I’ve had to adjust my expectations and spend more of my time showing people how using Newpoint can benefit them rather than just saying we’re great.
5. Keep pushing through uncertainty and doubt. There have been moments in my Newpoint journey where I wasn’t so sure we were going to make it. In those moments, I had to reflect on the importance of our mission to the fabric of society and work through the crushing feeling of failure, which I know all too well. The grit to drive through the brick walls you encounter on an entrepreneurial path can only be overcome from an inner flame fueled by your passion for your work. Because of my work, I know that failure is an option, but I choose to push through those moments even when it hurts or I feel discouraged.

Can you share a few ideas or stories from your experience about how to successfully ride the emotional highs & lows of being a founder”?

When you start a company, it helps to accept that low points are part of the process and focus on what you can control. I’ve also found that a lot of the time, you have to go through those challenges to reach the high points. For example, I learned from founding my own company that despite all best intentions, there will be people who want you to fail and will try and stop you. When you have a bold vision and do something new, people can feel threatened and want to tear it down. But on the other side of that, while putting your ideas out there can make you a target, it also helps you find people like you who support what you’re doing and want to join your mission.

Another example is that before founding Newpoint, I felt exhilarated because I had found the answer to the question about how to help small businesses in crisis. It was a high point that encouraged me to take the entrepreneurial plunge, but once I started building the company, I found out that the universe wasn’t as excited about our mission as I was. As discouraging as that was, it taught me that you have to fight every day for your dream and vision.

You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger.

I would want to start a movement to promote and advance education. We live in a world with so many major challenges and social problems, so it’s more important than ever to change the way we think and work to further humanity in our shared goals. Education is transformative. I actually see it in action every day because when you think about it, most of what we do at Newpoint is education: we equip people with the information they need and teach them how to turn their businesses around and become profitable.

How can our readers further follow your work online?

You can learn more at our website, newpointadvisors.us, and follow us on LinkedIn and YouTube.

This was very inspiring. Thank you so much for joining us!

About the Interviewer: Douglas E. Noll, JD, MA was born nearly blind, crippled with club feet, partially deaf, and left-handed. He overcame all of these obstacles to become a successful civil trial lawyer. In 2000, he abandoned his law practice to become a peacemaker. His calling is to serve humanity, and he executes his calling at many levels. He is an award-winning author, teacher, and trainer. He is a highly experienced mediator. Doug’s work carries him from international work to helping people resolve deep interpersonal and ideological conflicts. Doug teaches his innovative de-escalation skill that calms any angry person in 90 seconds or less. With Laurel Kaufer, Doug founded Prison of Peace in 2009. The Prison of Peace project trains life and long terms incarcerated people to be powerful peacemakers and mediators. He has been deeply moved by inmates who have learned and applied deep, empathic listening skills, leadership skills, and problem-solving skills to reduce violence in their prison communities. Their dedication to learning, improving, and serving their communities motivates him to expand the principles of Prison of Peace so that every human wanting to learn the skills of peace may do so. Doug’s awards include California Lawyer Magazine Lawyer of the Year, Best Lawyers in America Lawyer of the Year, Purpose Prize Fellow, International Academy of Mediators Syd Leezak Award of Excellence, National Academy of Distinguished Neutrals Neutral of the Year. His four books have won a number of awards and commendations. Doug’s podcast, Listen With Leaders, is now accepting guests. Click on this link to learn more and apply.