This week, Bill sits down with Megan Casey Glover, founder of 120Water, a nationally recognized leader in water compliance technology. Megan shares her entrepreneurial journey, from starting as a direct-to-consumer water testing service during the Flint water crisis to scaling into a SaaS platform supporting governments and utilities across the country.

The conversation covers the realities of customer acquisition costs, private equity, building brands that add enterprise value, and navigating long B2B and government sales cycles. Megan also provides candid insights into startup life, what it takes to grow through “white-knuckle moments,” and why marketing should be part of the growth plan from day zero, not year three.

Bill: Thank you for joining the Missing Half podcast, where we're discovering what's missing in manufacturing and B2B marketing. I have a very special guest with me today, Megan Glover. Megan, thank you for joining us.

Megan: Thank you so much for having me.

Bill: So, Megan, you are the founder of 120Water, which has grown from a direct consumer lab testing company, kit actually into a leading platform helping governments and water professionals manage drinking water compliance and compliance with a background in software and go to market strategy. You've been involved and recognized nationally as an innovative entrepreneur and leader in public health. So, Megan, we just I just covered a lot, right? Like the, maybe walk us through your journey, your early career and what's brought you to where you are today.

Megan: Yeah. Well, no, no, thanks for, thanks for the question. It's it's what I like to say, as I, I was not did not set out to found a company and water water found me and, you know, prior to starting 120Water in 2016, I was a go to market executive, and I, I was bit by the startup bug very early on.

Bill: I’m sorry.

Megan: I know, I know, my parents are sorry, too. I, after I graduated, from DePaul University, I was actually supposed to go to law school, and I just wasn't feeling compelled. And so I kind of took a gap year. I don't think that was a thing back in the early 2000s.

Bill: You were a pioneer.

Megan: I was a pioneer. And, and worked for my alma mater, in the annual fund raising money for, for the annual fund. And, that's where I met, a fellow alum, Angie Hicks, who started a company called Angie's List here in Indianapolis. And, I, I, I just I love that vibe. I love being part of something, you know, a startup and threw my hat in the ring to go work there. And, that's then where I fell in love with marketing because I ended up, basically starting their brand enforcement department and their online marketing function at Angie's List.

Bill: So, Megan, I think that's an interesting point. And we won't spend a whole lot of time on this, but no one ever says they went into marketing, and mom and dad were proud. Right. It's always like I was going to law school. I was going to do this amazing thing. And then you end up in marketing. But marketing is a career. There's a lot of, upside, a lot of potential. But, I just captured that. And, you know, we're trying to discover what's missing and maybe what's missing in all of our psyches or our, like, life stories is the fact that we have to get over disappointing mom and dad because we all went into marketing.

Megan: Oh my gosh. I mean, I have to tell this funny story. So when I left Angie's List to join a very early start up here, pre-revenue, I was employee number five. My parents actually called my husband and we were newlyweds at the time saying, What is Megan doing? Like, what is she doing? Like they were genuinely concerned.

Bill: Like it was time for an intervention. Like, you come home, they're all sitting in the living room, all the papers. Right? And oh my gosh, that's so funny. That's so true. So you're a startup addict, recovering and, doing great. And for the last nine years, though, you've focused on 120Water. Maybe tell us a little bit more about that.

Megan: Yeah. So, Yeah. Serial startup entrepreneur addict. I love the high. And in 2016, kind of a similar story, although one, one with, with personal passion behind it. I was having coffee with a mentor of mine, and we were talking about the Flint, Michigan water crisis because it was the height of, of that crisis, and you couldn't turn on the television without seeing a poor child getting their blood drawn for lead poisoning. And that hits. That hit really hard. I had two young kids at the time. And so, his name was Chris Baggott, and he had, a buddy named Dave Kohl who I know has been on your show, who actually owned a number of labs. And he said, you know, I've been talking to my friend about this and, and shouldn't there just be an easy way to, to test your water for lead? And I said, yes, there should. So I went home that night and I searched the internet, “how to test my water”. I called my water company and asked if I could get a test, and that's not something they provided at the time. They referred me to some environmental labs, so I called, some environmental labs here locally. They're like, we don't really do consumer testing, but if you want to walk in with a bottle, we'll do a full panel for 1200 bucks. Like, well, that's not accessible. So, long story long, I went back to Dave and Chris and I said, I don't know what's here, but I tried to test my water, I couldn't, and now I’m a mama bear. Ha! Now now I want to, I want to test the water at my house. I want to test at my, kids’ daycare. And so we reverse engineered, the lab to doorstep models. 23 and Me was was hot at the time and some others. And, and, launched 120Water in about seven weeks.

Bill: Congratulations. I mean, it's been incredible journey. I think a couple of things that one impacts there. Number one, you didn't start out, and I think this is a mistake that a lot of young entrepreneurs make, is they want to go out and make a lot of money. And when you start from that position, I feel like you're almost hurting your chances as opposed to starting out with, we are going to go and solve a problem. So you found a problem that is prevalent. It was, trendy. I mean, not popular, trendy, but there was trending information. There was a lot of, conversation about it. And then, you know, and I think this is still a problem to today outside of like, 120Water if you're dealing with commercial labs, they give lip service to the fact that they will invest in local communities and support drinking water. But if it's not a retainer contract or a large testing contract with the, they and for their business model, they can't afford to care because I don't even know $1,200 is useless or it's just the real fundamental economics of the way they operate. So I think that problem you solved hit a number of categories. And then so you start solving, seven weeks in. So this is a question I'd like to ask everybody, especially owners and founders, is, okay, seven weeks in, nine years later, there had to be some white knuckle moments. There had to be some of those, I don't know if this is going to work. Don't have payroll. Like, whatever.

Megan: Oh no one's getting paid. Oh my gosh. I didn’t see a paycheck for years. What are you talking about.

Bill: But can you, and I like, whenever I ask this question I know people sit across from me and I can see the flashbacks in their eyes because they're like, oh, yeah. Are there any of those you could share that you feel were the most, the biggest moments in this nine year journey?

Megan: Yeah. So the B2C model was not working. I mean, just flat out I think my mom bought a kit. I think all the founders bought a kit, we actually probably paid for our own product just to like post. I think we maybe had like 50 orders.

Bill: That's great. I love that.

Megan: And we were spending and I'm talking to a marketer. So I left out, our cost, our cost per click and our cost per conversion was off the charts. Like we were spending so much money. We were just bleeding money and I'm like, guys, this is not working. I mean, we had the best agencies behind us, you know, pumping up the brand, but people just didn't want to buy these kits. And so, you know, as the B2C model was just floundering, I, became very personally passionate about the actual market and drinking water regulations because I became curious, like, how did, how did we end up here in the first place? How did the Flints end up here in the first place? And what's the safe drinking water regulations, and are there more Flints out there? And, so we happened to get connected to Pittsburgh Water and Sewer Authority, and they had, they had been dealing with a lead issue, not at Flint scale, but they had found, and exceeded the lead and copper rule and their president at the time did offer consumer markets. He was probably a very you know, he's like, well, you know, if this is public, we want to make sure we have an offering to to assure our our residents are safe. And, and the floodgates opened. They were sitting on like 4000 unfulfilled kits. When we met them. And we had just built this very robust, automated way to get kits to residents' hands. And so we, myself and Dave and Chris, we went to Pittsburgh and we showed them the process and showed them the dashboard. And we had that contract, a week later. And so that was the tipping point where I officially kind of quit my day job and said, I don't know what's here, but we're going to kind of pivot this business to focus on governments and municipalities that are going to have to meet the demands of this increasingly, new world.

Bill: Which basically is the same model. It's just you're facilitating it through an intermediary.

Megan: Yeah. And then that allowed us to have economies of scale for the lab testing. Because that was the thing that's crushing us to these one offs. No one wants these one-off tests. Right. But if I can bring thousands at a time to these laboratories, then I'm able to have, price, you know, different conversations about pricing and.

Bill: Sure. And they can get they can get excited about it, and then it doesn't cost them, because I would even argue that on that $1,200 kit for you when you originally started this, that lab was going to make little to no money.

Megan: Oh, it's highly commoditized. It's a very manual, labor-intensive. Yeah, absolutely. So it's fair.

Bill: It flipped the entire industry and the whole like economic structure there. So you had those white knuckle moments. So we got, you did kind of like the Girl Scout cookie route to sell your first couple kits. And yeah, I can imagine your, like CAC. Like, what were we selling the kits for?

Megan: Oh, $50.

Bill: And they probably cost, cost … ten, 20,000. Yeah.

Megan: Right. Yeah. Oh, my gosh.

Bill: Yeah. Now you're having the flashbacks.

Megan: It's like, I think it was 17,000.

Bill: Okay. Yeah. So, like, you had repressed their memory and I brought that back up. I'm sorry. But like.

Megan: Yeah. It was awful.

Bill: So thank you for that honesty, because I think one of the things that we often see with successful founders, especially after exit, is they try to repress all those memories. And then the story we hear is not reflective of the blood, sweat, tears and physical as well as emotional pain that we experience as we go through this process. And I think that's, untoward of us to communicate that to younger generations because they see these stories. Yeah, that's going to be me. You made ramen noodles for forever. Like it might be ten years of pain. Yeah, and it might be ten years, and then it fails. And then you have to do it again till you find the one that works. But I that's that's amazing. I love that, I don't love the CAC, that makes. I'm starting to sweat a little bit. Is it getting warm in here? CAC of 17,000 and we're selling for 50 bucks.

Megan: But haven't even gotten in to our first B2B SaaS or B2G, SaaS CAC.

Bill: Oh my.

Megan: When we actually launched the software.

Bill: Okay let’s go down that path.

Megan: I mean that I mean, I think at one point we were at $100,000.

Bill: Oh my. It is. Okay guys, turn the fans on or something. I'm in a cold sweat or maybe it's a hot sweat. I don't know what's going on here, but I'm having a physical reaction. Yeah, yeah. Let's talk about that a little bit though. We as marketers know the first one is always the most expensive. And you have to figure it out. You have to throw some lines in the water. You go to test and fail repeatedly till you figure it out. You had a marketing background. And a lot of folks we talked to in PE, and VC are not as accepting of those ideas even to entertain them. I mean, when we talk to them, it's not about talking about marketing as a capital lever for growth. It's always like, well we don't want to spend that. They have expense in their mind, not invest. Let's talk about $100,000 CAC and how you were navigating those waters with the board, with the investors and that type of thing. How difficult was that and how did you make it through that?

Megan: Oh, that's a… yeah. That's... so we were, we were fortunate and that when we made the pivot to government, we also landed a very large customer contract that really funded the, the business, self-funded the business to about 2 million.

Bill: Oh, nice.

Megan: So, yes. Nice. But then that's, you know, that's where all of our focus, we certainly weren't scaling or doing anything to build upon it, but we were at least able to catch our breath and, and be customer funded for a couple of years before we had to take on a, a full, full scale board, if you will. And then I think that's so fascinating. I, I always said early on, I said, guys, our first three customers are going to be the hardest customers we ever acquire in government. Because I, I would have these conversations. I mean, hundreds of conversations. I'm a huge voice of a customer person. And I would always end every conversation, whether I'm not trying to sell you anything, I'm just trying to say, is this a solution worth continuing to do? Or tell me no. Tell me to go pound sand. And, and in these, in these conversations with very large utilities they'd be like I think you got something here, but I can't invest in you in at least three years because I know that you need to be around. Like I know that your technology needs to have some sort of street cred. And so from that, I always had that mentality that our first three customers were going to be the hardest. And then our first 30 to get to some sort of like repeatability were going to be even harder. And then after that then, you know, gloves off. Let's go.

Bill: Sure. Well and if you had self-funding through customer revenue, then you at least weren't dealing with capital calls whenever you have $100,000 CAC so that that makes that not easier, but simpler, I think, in a certain sense.

Megan: And yeah, and then I think as an entrepreneur, more validation and conviction in your idea. So we use kind of that self-funding of those two contracts to then get our first three customers. And then we also use that time to do a ton of voice of customer say, what does the next product suite, need to look like, a software suite need to look like? And then that's what we raised the series A on. And then then, you know, all of the, you know, economic conversations that come along with that. But. Yeah.

Bill: Sure. We hadn't planned to talk about this at all in the pre-show, but I want to explore this for a second, because I think this is something that's missing in a lot of thesis is, if you're going after the government as a customer, whether it's local, state or federal, that is very, very difficult because they're they want to see track record and it’s chicken or the egg, right? I mean, that, can you give some advice or some perspective on how long and hard that process is, which is much different than consumer or even B2B because you have more, exception, adoption, willingness to kind of think outside the box, I would say on the, like just, industry.

Megan: You have more levers. You have, more go-to-market levers that, contracting levers, you know, more innovation is accepted. Sure. Yeah. Yeah.

Bill: So you found that governmental push that was extremely difficult and took time. But, let me ask you this, and maybe this is what's missing in a lot of strategies. How did you get the first three? Like, what was it finding a visionary like, what were the components of that? If there is anything that could be extracted and and scaled in that idea.

Megan: So the first. Yeah. First three, I think, that's a great question. One: crisis, you know. Right. Crisis. I have no other option. And you're an innovative option that solves my problem. Right. But then I would say the next two after that just innovative folks that that were open to change. Because if you think about it, like we were bringing a new way, a new way of physically collecting these samples that had never been done before in these utilities. So we had to find those, those very specific people within the utilities that were willing to let go of that manual process and adopt our, our new way of delivering these kits. Now it ended up being a better way because by letting go of the process, they got more visually in terms of the dashboard, and they actually had more control over these samples, which is so ironic, right? Sometimes letting go of, of the manual process and allowing innovation to show them what they can't see. Right. So it was that and I think the other thing is, we followed the market and we always stayed a few steps ahead of where we thought the market was going, even if we didn't love what we were building. Not sexy stuff. But, you know, we kind of anticipated. Okay, well, if this if this regulatory thing actually drops, here's the pain it's going to create for that end user. And if we can continue to provide solutions that solve that pain, then we always had a constant pipeline of of targets or opportunities that we could, source, if that makes sense.

Bill: Sure. No and maybe what's missing in my thinking and in others is when we think about the government and whether it's federal, state, local, whatever, we think of them as kind of like a monolith. Whereas there is, there are still humans that work there, and they have human psychology, and there has to be a component or a, a small group that are early adopters. And maybe in our ABM or in our canvasing of the market, we need to do a better job of recognizing signals from their organizations as far as early adoption. And that needs to be our like, dream 100 or that we need to hone in on and that, no that's a great takeaway. And I think for me that's something that's missing, has been missing in my approach to it. And, thank you for that nugget. Because I think I'm going to figure out how to scale some of that. But, well, whenever you think about your background in marketing, bringing that to a startup and then bringing that to private equity and marketing that business, did you see yourself as a little bit different than some of the other folks that you were talking to in that space with your marketing background? And seeing marketing as something that could help 120Water grow, or how how did you navigate that space and what what did you observe in the process?

Megan: No, I mean, without a doubt. So I'm just a firm believer that building great brands absolutely contribute to enterprise value. Because I've, I've, I've worked for good products with a great brand that have had better outcomes than great products with no brand. So I just the, and when I say brand, brand is your people, it's your assets, your image assets, it's the quality of content. It's, how you talk to your customers and where you put them in kind of the life cycle of, of everything. Right. And so, so I just, that is something that I never compromised, like starting 120. I mean, and I saw an opportunity in water because water didn't have a company with a strong brand. You know, and I mean, we were the first, we were the first to really build out this thought leadership layer. At that point in time, the only other people putting out thought leadership content were the regulatory agencies and the EPA. But no one was really investing in how do I take this content and actually make it turn it into practical playbooks that I can follow as a, as a water professional? So, you know, we've invested a lot of money in that, and I had to fight really hard to show, no, this is an investment. I promise it's going to pay off. But, you know, when you're when you're spending that money, you know, hundreds of thousands of dollars just on content and thought leadership for those that are not invested in it, it's it's, it can be a challenge.

Bill: Well and you filled a vacuum. Correct me if I'm wrong, because when we think about this play, this playbook has been around for a while. But when we think about your target audience, that would have been more cutting edge and newer because there was nothing in that space. I mean, I’ll, plug your, podcast, Making Water Work. I was listening to, I think it was the second episode, and you guys talked about your target audience is still running most of their operations via Microsoft Excel spreadsheets. They’re not even on Google Sheets. Or maybe even on the cloud. They're still on, the desktop versions of these softwares and running that way. So do you believe there are still plays in the market where we have these late adopters, that we can still run this playbook and it can be revolutionary, have an outsized impact, and certainly not only on the market and building brand, but then on enterprise value.

Megan: Oh, absolutely. I think that we’re at the tipping, like we haven't even started. Like I think, you know, it's only opportunity in water because we've seen we've seen that it works. Right. And and the other thing that I maybe will go back and say what else, what I saw so clearly when I started is water, water professionals and water utilities don't market to their customers. They don't communicate effectively to their customers. They don't market, you know, what is essentially our most precious resource, water. They're they're just not good at it. And so, 120 we had the opportunity to bring that bring that consumer facing beautiful kit. Oftentimes we were a marketing vehicle for the utilities. And we took full advantage of that. And not only building the brand within the utility about how to run these programs, but that that bridge to the consumer. And how can that, you know, by, you know, by default help their brand as well.

Bill: So I’ll also give another plug to your podcast. Episode three, you interviewed the, director at the Louisville Water Company, and I found that story to be compelling and fascinating because I had never considered branding and trademarking water from a utility. And, like, I mean, so, we'll have the links in the show notes and everything, and people can click on that and watch it. But I thought that was a very compelling story. And in that market, there is a complete void. You know, they've done a nice job down there, but it sounded like a little bit of a unicorn in the market. And then what you're doing on the SaaS side. So we have a theory. So we've launched another, enterprise, called 50 Capital Growth where we're focusing on marketing's impact on EBIDTA and exit multiples. And this to me is something I'm becoming much more passionate about because I keep seeing missteps, unrealized opportunities, especially on exit, where we're looking at, you know, we get a nine, but we could have got a 12, we get an eight, but we could have got a ten because we're not figuring out organic growth. We're not figuring it out, well, you know, everybody has the three year hold. We're going to buy it three years. We're going to roll it up, we're going to flip it. But we're seeing, I’m seeing some studies out there. You know, we're now seeing hold periods that are 5 to 7, nine, ten. And I think what happens is if you don't have that miracle ride of three and out, the board's sitting around and saying, okay, we need to grow and we're not as excited about buying it. So let's have some organic growth. I have a a thesis that or a theory that if you wait until year three and there's a problem and then you pay attention to marketing it, you're already in trouble. Because, okay, then you can start, but then you're trying to impact six, seven, years six, seven and eight. You're not going to. There is no magical machine now, and I'm sure there are some. Could we find examples in the market where someone has gone viral, has ridden the rocket ship and yes, sure, but those are outliers. If we're looking at fundamental business and the fundamental PE roll up play, our premise is that day one, even pre-deal.

Megan: Day zero. Yeah, pre-deal.

Bill: All right. Let's do some planning. And part of the due diligence process, have a theory that we're going to test and be ready to deploy day one and get some demand generation going. Make sure the brand’s solid have that foundational play there, and then start to experiment so that we have the opportunity for organic growth. Can you talk about that idea and what you've seen work or fail, in those categories?

Megan: Yeah. So, I'll just kind of walk through, you know, 120Water’s customer acquisition journey and why building our installed customer base through thought leadership and marketing was so integral to actually raising our private equity round. So, you know, when we launched our, our software suite, we were heavily weighted to enterprise. Enterprise is the 1% of the market, our market’s long tail. And so, we needed to focus on, growing our installed customer base. Right. Because that was the only way that we're going to be able to, what we, our business model’s very much land and expand. Right. We're going to bring them in for this particular program and then build applications to expand their their, more programs that they run, because more programs equal more value for our customers. So long story short, in 2020. Great, great time to raise a series A, right?

Bill: Timing is is everything. And you had, none of it, right?

Megan: None of it, you know, but, but that's, you know, we, we had this rally cry, which was, we really believed that if we could own more of the customer’s data related to this regulatory trigger that was going to happen in October 2024, we would own the market. So, and that's because every single water utility had to digitize their data by 2024. And we knew if we could be that solution, that we would win the category. And so we just wrapped, we wrapped, it was a marketing play. I mean, yeah, we built a great product to consume that data. But, it was a marketing play. And as a result, I think we acquired, about 7000 licensed customers in a couple, a two year period of time. And, and even now, like our webinars, have about a 2000 attendee.

Bill: That's incredible.

Megan: And over 50% of them actually join the webinar.

Bill: Wow. That is a fantastic conversion rate. I mean, because in some markets you can get a lot of people to sign up.

Megan: Right. Yeah.

Bill: But then the actual attendance. And then are you, so then the the follow-on question would be, are you seeing a great conversion path from the 50% that attend? Like are you seeing, I mean, I'm just, certainly you're measuring the attribution and you're figuring that out, but have you seen that as a positive path to purchase, getting that 50% to participate in those webinars?

Megan: Yes. Yes and no. I mean, yes and no. It's, the the long tail is real. I mean, we talked about governments acting slowly, so it's not unheard of for someone to attend a webinar and two years later purchase.

Bill: Oh, sure.

Megan: So it's not immediate. And sometimes we clear the pipe and hey, you know what I mean. And and start over. But, but yes, it is, it is our number one, number one opportunity generator for us. And, and then how did that lead then to the, the private equity? I think once we felt comfortable that we owned, that we had created this moat, this competitive moat between all of us and our competitors, we felt that the timing was right to go raise our series B and ended up doing a private equity recap. We we didn't set out necessarily for that, but that kind of is how the deal ended up. But we felt confident, given our kind of market position that we could do something with that in private equity. Or series B.

Bill: Excellent.

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Bill: So let's, let's turn on the marketing a little bit. So the webinar’s working. That's, so that's great. And you you have a path and great attribution. Good conversion. Are you willing to share with us some of the things that absolutely tanked and failed miserably in the marketing journey? And like whenever people ask me this question, like, my mind starts spinning because I can think of 2 million things off the top of my head. It's like, which one to talk about? And, I think young marketers, especially like we’re going to do this thing and put everything into it, and it's going to work because I want it to. And I believe in it. And I think this is the best idea. Over the years and the, lost battles, I've come to not believe in anything until it is tested and we get market response and to not care.

Megan: Right. It’s not you. It’s about them.

Bill: Yes. It's just it's. Who's going to respond? How are we going to get a reaction that's going to drive well, whatever the goal is. What are some things you guys tried that just absolutely washed out?

Megan: Oh my gosh. So, I know, that's what I mean. How do I distill it down to, I mean. Paid advertising does not work. I mean, just forget about paid advertising.

Bill: That hurts.

Megan: Sorry. I mean, just for our audience. Right?

Bill: Well, no, but I think in B2B that's a fair. You know, it used to be, there was a premise that Meta could deliver through Facebook and Instagram a tremendous amount of targeting. And then there were some tools you could layer in to really get down into the details. I mean, at this point, we can find anybody and we can deliver ads to them on Google, on Facebook, on Instagram, YouTube, everywhere. We have not seen that drive revenue. I think it can drive brand and help us on that front. But as far as attribution, it's, it's a waste

Megan: A waste. Yeah.

Bill: So I 100% agree with you.

Megan: So that that as a tactic. And then I think is just as an overall thesis of strategy, marketing speak does not work. So I had to change my vocabulary coming from B2B SaaS to, you know, water, because it doesn’t. They see through it and they’re like, I, you know, you have to it's, I think we, we we've had some, maybe some mishires or bringing people in and they've tried to like, SaaS it up and like, nope, that's not going to work here. Just use plain English.

Bill: So I think, I think that that is a, something that's missing in the approach of marketers, the baffling with B.S. and all of the acronyms. And then, like, I know that some of the young people sit in the classes and have the bingo cards for all the, and that's a thing. I think they do that on Zoom with all of the meetings I attend at our company, they're waiting till Bill uses enough of those words. And then I, I see them smiling and like, I know they're, like, messaging themselves and they're all like… Anyway, I, I, I find it, and then they, they get the, gen Z cut reels. Oh, yeah. All my flubs. Yeah, they they love me.

Megan: They love you.

Bill: They love something. But, so I think the paid media has to be done very thoughtfully. I think what we're seeing, the best application of paid media is finding something that works organically, then amplify it. Thought leader ads, really push the YouTube, whatever. That is the model for B2B. And I think one of the challenges that we face in B2B is a lot of the clients don't want to hear about testing. They want you to come up with this big idea and I think it's a resource constraint. They don't have the bandwidth, at least the spaces we operate. We're not working with multi-billion dollar companies that have 80 on staff and like, I mean we're mid-market and I think they're opinionated. A lot of the owners, founders and C-suite that if you take these ideas and they're like, nope, nope, nope, this is where we're going because this we've always done it. So I think there's a challenge there in the space. Then you have the other side, which, you know, people are like test, test, test. And they're more fun to work with. And you usually almost always get a better result.

Megan: Absolutely.

Bill: So were you able to find that testing a lot of ideas was integral to the success of 120?

Megan: It's been integral to the success of my career. Because I think, you know, the power of testing and removing bias is just I feel like, you know, if you're a good marketer, that's, you know, part of A1 of your priorities, right? And I had just I learned very early on that what maybe works for me may not work for the audience. And how do you know that unless you test it? So yeah, anyone who says, hey, I don't want to test, I want to get it right the first time. That would be immediately red flag in terms of I don't think I'm gonna meet this person's expectations.

Bill: That’s right. It never works.

Megan: It never works.

Bill: I mean, you might get lucky, but, that's not a good way to run.

Megan: Luck’s not a strategy, right?

Bill: It's just. Yeah, it happens sometimes, and it's never, sustainable.

Megan: Yeah. Yeah. No. So we are we are constantly testing, even down to the, we're big schwag. People, like, we take our brand with us in the field. So we have, like, different brands that we've created within 120, like the BAWOW brand, which is the Badass Women of Water brand. And then at Royal Water, you know, the one of the schwag kit and we're big on Legos, too. And so, again, we we test even down to like, okay, well, that Lego failed. People don't like back to the future. So stick…

Bill: Well, maybe you can offer some advice to, young founders who are in a startup and, and who are thinking about, like, really looking at VC and private equity. How much does your life change as a founder? You know, you’re product-focused, pedal to the metal, you're in the weeds and then what? You're splitting your time 50/50 between that and now.

Megan: Bored and.

Bill: Spreadsheets.

Megan: Yeah. Spreadsheets and cash management.

Bill: Yeah. Talk about that.

Megan: Yeah, yeah. And I think the expectation around capital has changed, certainly within the nine years since I started, you know, 120. You know, it was. Okay, raise your round. And now just go burn a bunch of cash to try to create sales. And and now it's it's not burn a lot of cash. It's, you know, get to profitability or show us that you have a path to profitability. So, for younger, it's not I would not have changed my journey whatsoever because we needed the capital to get where we are. But it is not for everyone. And so that's where I would say, lean on people who have gone through, you know, those funding rounds. Make sure you have the right people around you. Because if you, if you aren’t, if you don't want to sign up for boardrooms and spreadsheets and you're always having that next conversation about where's the money coming from, if that's not your superpower, then make sure you have someone around the table who can, like, slide into that seat. Because once you start as a hamster wheel, you can't get off.

Bill: And maybe for some of those founders, if they're just a product person and I'm not saying, yeah, like if that's their superpower and that's all they care about, it may be better for them to just sell it and move on to some other project as opposed to enter this world, because it's not for the faint of heart. And it is a grind. And yeah, in my experience, and maybe for others, it's been just roses and cupcakes and good for them. But it's, it's a tough road, rewarding, challenging. But it's not, the 30 second to minute and a half clip after 30 years of war that they give for their memoir or when they're being interviewed. I mean, it's a rough go.

Megan: Yeah. Yeah. And and each of those milestones, I, I almost had to have a pep talk with myself and say, am I am I am I ready for this next stage? And I, and I'm sure Dave Kohl can, you know, attest to this, how much I grew as an operator throughout all of the stages. And you almost become a different professional. You do. And so to your point, like, there's nothing wrong for product founders to say, I just want to stay in my product lane. But if you want to stay in your product lane, know that you probably need to bring someone in at that operational lane. You know, if you if you really have conviction that you can, you know, take this thing to the next level.

Bill: I think that's that's great, like introspection and recognition of your journey. Because I'm sure Megan in 2025 looks back on Megan in 2016 and sees a tremendous story arc.

Megan: Who was that?

Bill: And let's talk about what's missing in our perspective when we're younger, and maybe some advice we can give to, because I like to invest in youth and try and give them advice. And I’m constantly asked things. I don't know why. But like, sometimes I'm like go ask someone way more successful than I am. But, it's okay to have an expectation that this is a long journey. Ten years is not an unrealistic expectation for a startup to be successful and have a financial exit that is effective for the owners, founders, and all of the people who invest along the way. I mean, the the folks who start the AI company on Friday and it's worth 5 billion on… I mean, I would recommend, if that's your plan, go buy scratchers.

Megan: Right. No, seriously.

Bill: Like I mean, I think it was like 170, whatever. It was some stupid number like go do that and figure out how that game works as opposed to get in to the startup game. Do you see that, like if you reflect on Megan 2016 version whatever, that was 7.0 and now you're at 25.0 or whatever. What is that story arc like and how have you just had to grow and stretch yourself at those stages to, to make it?

Megan: Well, I mean I clear as day and it was my co-founder Chris Baggott. So I had to convince my co-founders that we were going to go into software. We're going to create a SaaS product. Right? They weren't all on board. And I, and I remember clear as day, Chris, looking at me like, I will support you. Like as co-founder, we believe in you. We trust you. You just know that you have now committed at least to seven years of this journey. And I'm and I'm I always think back to that and I'm glad that he I'm glad that he sat me down and just said, but you need to be committed to this because, I think to your point, so many young startup founders think, oh, this will be a three year flip and I'll make my first 10 million, and then I'll just go do it. And it very rarely, you know, very rarely turns out that way. So just knowing that, okay, if I signed up for this and I raised this, this seed capital, you know, be mentally prepared that this is going to be a journey, not a quick flip.

Bill: I think that question that Chris asked was so important for you to answer.

Megan: At that stage. Yeah.

Bill: And not not to him. Right. You weren't answering that to him. Megan was asking Megan about that and answering Megan, because if not, you may have on that journey had to stumble upon that question as opposed to proactively deal with it.

Megan: That's a great perspective.

Bill: Because whenever, you're a very driven person, I can tell you're, you're, you're ready to go. And if you decide you're going to do something, you're going to make it happen. But if we don't decide that we're doing it, we're just kind of like there.

Megan: You're half in, half out.

Bill: Present but not committed. So I think that question, that's a great question from someone who is, was in your, sphere of influence and was able to kind of make that, that decision point for that moment occur.

Megan: Yeah. Because I think the other part of it is once you take that first check, whether it's from your mom, your dad or a, you know, a capital partner, like your fiduciary, you have a fiduciary responsibility. I took that very seriously. And, and that also stuck with me. It's like, okay, you have an out right now. You have a window of opportunity to say you don't want to do this. But yeah, you have to be committed to the outcome.

Bill: I think we're in the other challenges that occurs is even so, let's say if early in your career you have success, that doesn't make certain that the next startup is going to go as well, or those conditions are going to come together, because one of the things we've seen in our marketing work, in supporting startups is, we often find people who caught lightning in a bottle on the first round, and then maybe they're looking for that second play and it just isn't happening. And I don't know if it's… I think it's a combination of market conditions and then human condition. The market conditions may not be as ripe or like cost capitals operate, again there's other pressure. So it's not churn and burn and earn. It's earn, prove it. And then more capital. But I also think it's the human condition where maybe in the second or third go round, we forget how long it takes, how much patience, how. And then you're probably at a point where financially it's not as important. So if it doesn't go well and whatever, like, I mean, it's good, but it's bad, but it's not the end of the world. Have you seen that with any other startups and startup founders that you've been associated with that like the second or third is completely different than the first?

Megan: Oh, yes. Absolutely. I mean, more times than not. Right. I feel, that and I also think it's the, applying in, in marketing and go to market. I'm just going to apply that playbook that worked. And and it's a disaster. Right? Disaster. And I think so I will say I, I think where I've seen it right is when entrepreneurs have actually brought just fresh to get to your point, fresh eyes, fresh perspective. And they're not just I'm going to rinse and repeat that here because that never, that, I've never seen it work.

Bill: I think that worked maybe pre digital.

Megan: Yeah. There you go. Yeah.

Bill: There was a there was a playbook that worked for a long time consisting only the rate of change today. And we don't even want to talk about AI because that whole, you know, the impact and the rate of change there, we don't even can’t quantify yet. There's probably a new math for that, which I won't understand, but I'm sure some people who are very, very bright will. So, Megan, you find yourself today and, going through another transition from the operating CEO to now the founder, more focused on acquisition, development, the future of the company, how how is that going? I know it's fresh. So, like you’re right in the new job and kind of experiencing that, how is that going and how is that transition been for you?

Megan: Yeah, yeah. It is. Yeah. I would say we're at the kind of the tail end of the, of the transition and obviously finding that successor and someone who can kind of step into the business, is just everything. So I'm very fortunate in terms of the successor, comes from our, our private equity group, came from Edison. So he's been very familiar with the business for many years. He ran the operating partner group before becoming our new CEO. So, I would say it's, you know, it's it's it's been interesting. And I have to consciously remind myself I'm not in that seat for his for his success and mine. But, but stepping into kind of where I get to personally find joy has been really rewarding. So stepping out of the boardroom and, and I've had more customer interaction, market interaction, starting the podcast has been a lot of fun. So it's actually in some ways, I think this, this next chapter might, might even be, a really nice, rewarding kind of cherry on top to the whole journey.

Bill: Well, one of the things I've observed in, from my perspective, which is very like far away, is there's almost feels like there's a role reversal with you and Casey because, now you're looking at acquisitions and big picture and trying to put all that together. And now he's in the weeds. And when he was the operating partner from Edison.

Megan: So interesting.

Bill: So, like, I feel like there's some type of, bizarre irony. I don't know what the, the literary device is that would truly describe it, but it feels to me like there's, there's, there's this tension, not negative, but there's this healthy tension in this role reversal. And I think that could set you guys up for some outsized success, because you will understand him and he will understand you. Whereas I've seen this, I've seen this three act play before. And there's zero understanding from both the, the newly minted founder and the new operating CEO. And they don't understand each other. And then there's so much negative tension. The, the next acquisition, and the next operating play really become completely unaligned. And and why does that matter? It destroys value. At the end of the game, it it's a negative impact on the exit multiple and the EBITDA. And that's where we run into. So I think that's a unique thing. And I'm observing this from like, 50, 100,000ft and I, I have no knowledge. But that to me seems interesting. And this is, this is a different type of question and completely unrelated to corporate strategy. It's hard to let go. Right. Nine years. I mean that's tough.

Megan: It is. Yeah I know. I'll tell you what I told. So we had the entire company in last week and it's interesting that you brought that, that up because it was the first time… I almost had an out-of-body experience. It was almost the first time that I got to kind of float above and see the entire company and watch this new CEO kind of literally pass the baton, kind of in, to execute what we've been talking about for so long. So it in some ways, I, it just felt, it felt very I, I got, I got kind of emotional just kind of watching and watching all of the people that I recruited and, you know, the, the strategy that we talked about forever actually coming to life and, and all of the feels. So I feel very fortunate that I have this opportunity to step out of the boardroom and spreadsheets and really have a clear view of what is going to make this next transaction successful, not only for the people internally, but I think for the industry as a whole.

Bill: Well, and who better to do that than someone who really understands it? I mean, when you think about, and we talked about a little bit about this pre-show, when you start thinking about acquisitions and you're thinking about not doing them on a board deadline, but on a strategic timeline, that we can really evaluate cultural fit, we can value fit, it like is there product market fit, is there…

Megan: Team fit? Integration. Yep.

Bill: Yeah, I mean, all those things are important because I mean, you can shove them. I mean with enough money you can buy them for too much. You can spend too much integrating them and then pay the ultimate price on exit when it doesn't work or if you have someone who has that eye, and I think that's going to make your team really successful because the the possibility of synergy and understanding between you two, I think can be amazing. But like what you're saying there, I think that out-of-body experience, I remember very clearly, I took over a division for, my father. Like, we won’t even talk about how long ago, because it'll date me. But, there were 400 employees, and I took over. Pre pre my marketing adventures. And he was able, I felt, to have a much more strategic oversight because he wasn't dealing with, you know, even during those meetings, the sidebar conversations of like, hey, we got to go deal with this employee separation issue. Like, I mean, oh, the insurance company called and we have to renew, like there's some policy, like. So I was in the muck.

Megan: You got to inherit all of those.

Bill: And you know, then his strategic oversight was more clear because he wasn't bogged down with the grind. So, yeah, I think there's a lot of value in you having that perspective. And I think you're going to bring a lot of value to the organization through that. So congratulations on that journey. Well, Megan, this has just been a fantastic conversation. We have gone around the world in about an hour. We've been in marketing. We've been in PE, founder. I think some great advice. If there was one thing you would want to give our listeners as a takeaway, from your journey and we support the, like the 30 second pause for you to think about this, right? You don't have to just like.

Megan: Good. Good good. Yeah, yeah, yeah.

Bill: Oh, I have this, said since my one line, is there any piece of advice or takeaway you would give, someone and let's narrow it down a little bit. If you're thinking about as a, as a founder, entering into that institutional money, right, you're, you're going to start talking to VCs, you're going to start talking to the family office, PE, whoever. What would be one piece of advice you would give that group as a part of the reflection of your experience?

Megan: While this may be an obvious, I'm going to give a two parter because I'm a marketer. I like to tell stories. But I think, you know, I'm assuming that you've like, you've mapped your market and you have conviction around your business model, how it scales. So just, but is, it actually it is amazing to me how many entrepreneurs don't think it all the way through. And then they get to that inflection point. And even if they wanted to close around, they couldn't because they haven't thought about like, what is what is the TAM, what is my go to market motion. What are my resourcing needs beyond just capital? Like, what's the team I need to build, right? Who's my eventual, what's the next milestone? And then, you know, beyond that, just having a really sound, business model. My advice is, would be do your research on who you're thinking about taking money from. Because it's not just about the money, it's about the partnership that you're going to create with that new, with that new partner. And so that's almost as important as the check that you're going to receive at the end of the day. So do your research. And, even though it's intimidating, you know, make sure that it truly is a partnership, at the end of the day.

Bill: So I think those are two really important points. In the first is be prepared for scrutiny like you've never seen before. And, it's just business. It will feel personal, but they will crush your soul with questions. And if you do that, if you are not prepared for that, it will be professionally and personally devastating.

Megan: Absolutely, absolutely.

Bill: And the second thing there, I think the money comes with strings attached. So I mean, I don't want to like, equate it to marriage, but like you are going to spend a significant amount of your waking hours with that entity on your mind. At the ballpark, when you're on the jog, they will be your constant companion and probably in your dreams and some nightmares for the rest of your life with flashbacks, right? So like I mean, and not to like, like overdramatize it, but, it's real, right? It's real and it will, it can eat you. Or it could, I had a, business we owned that we had a partner in that business that it, was not a great relationship. They were a, anyway, not to get in the details, but, it was a nightmare situation, and I live recognizing that. And, I don't ever want to do that again, but I wouldn't know that until I've lived it. Right. You wouldn't know that. So. Well, Megan, this has been fantastic. Thank you for joining us. Congratulations on your podcast, and thank you for hosting us here in one of the studios you use, here in Indianapolis. This has been fantastic. Fantastic city. Enjoy the, the sights and sounds here. And, just really appreciate you joining the show.

Megan: Oh, thanks so much for having me.

Bill: Thank you for joining the Missing Half podcast, where we're discovering what's missing in manufacturing and B2B marketing. Like share, subscribe. Have a great day.