Ep. 374 — Eric Rieger: Why Owners Take the Check When They Don't Have a Why

6 min read

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Episode Summary

You’re getting the calls. Three thousand IT rollups since 2020, one and a half trillion in dry powder that has to be deployed in the next five years, and the same dynamic is hitting every industry built on owner-operators. The check looks great. And if you don’t have a clear answer for why you built this, the number on the page wins the argument every time. Eric Rieger is the founder of WebIT and an ESOP convert. We met in Gino Wickman and Rob Dubay’s 10 Disciplines program, and the minute I jumped on a call with him he wanted to start with why we’re here on this planet. So we did. We got into the Doug Brackman “driven” DNA that makes some of us pull threads other people leave alone. Why peer-group benchmarking and the Inc. 5000 chase pushes owners toward growth they don’t actually want. The 15-35% growth zone Eric calls the Goldilocks for culture and cash. Why he doesn’t pay commissions and how he ties profit back to value created. And the part that’s still unfinished: even ESOPs can get sold to private equity, which is why Eric is now studying the perpetual purpose trust route Zingerman’s took to make WebIT truly evergreen.

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## Top 10 Takeaways
  1. Profit can’t be the answer. It’s the result of doing the right things for the right people.
  2. If you don’t have a why, a seven-figure check eventually makes the decision for you.
  3. Cash is the oxygen of the business, not the purpose. The purpose is the experience cash funds.
  4. Visionaries need a sandbox with a process. Without a integrator, your dopamine becomes a destructive force.
  5. Growth between 15% and 35% is the Goldilocks zone. Faster wrecks culture. Slower starves opportunity.
  6. The Inc. 5000 measures top-line growth only. Growing fast is one of the cleanest ways to go bankrupt.
  7. Track liquidity (free cash divided by payables). It tells you how many months you survive at zero revenue.
  8. If your salesperson earns commission on the recommendation, the customer’s interest comes second by design.
  9. Open book without context backfires. Show one number and your team will invent a story to fill the rest.
  10. An ESOP doesn’t fully close the door on private equity. A perpetual purpose trust does.

Sound Bites

“If you don’t have a why, then you’re probably going to get enticed by a check at some point.” (@TBD) — Eric Rieger

“Fifteen to thirty-five percent year-over-year growth is the Goldilocks zone. Over thirty-five percent creates chaos because you’re hiring faster than you can find people who fit. Below fifteen and you’re not creating enough opportunity for the people you have.” (@TBD) — Eric Rieger

“Control is an illusion. Everything is random and chaotic. You can’t control what happens around you. You can control how you react.” (@TBD) — Eric Rieger

“If profit is the number one reason, then you’re going to get what you get. It’s like AI. If you didn’t tell AI that human life is important, it will consume human life.” (@TBD) — Eric Rieger

About This Episode

Eric Rieger is the founder of WebIT Services, an Illinois-based managed IT services provider that converted from sole founder ownership to a 30% ESOP with a stated plan to go to 100%. Ryan met Eric through Gino Wickman and Rob Dubay’s 10 Disciplines coaching program. Eric is currently writing a book about his entrepreneurial path, with particular focus on the decision points that led him to reject the private equity rollup wave hitting the IT industry and pursue employee ownership instead. He is now studying perpetual purpose trust structures (the route Ari Weinzweig took with Zingerman’s) as a way to make WebIT truly evergreen and lock the door on a future PE acquisition.

Resources Mentioned

  • WebIT Services — Eric’s company. — webitservices.com
  • 10 Disciplines — The Gino Wickman and Rob Dubay coaching program where Ryan and Eric met.
  • Driven by Doug Brackman — The “user manual” Eric references for visionary-wired entrepreneurs.
  • Sapiens by Yuval Noah Harari — Referenced for the way humans build narratives.
  • Patrick Lencioni — Referenced for flipping the org pyramid so the CEO holds it up rather than sitting on top.
  • Simon Sinek — Referenced on leading with empathy when a teammate misses their numbers.
  • Zig Ziglar — “You can have anything you want as long as you help other people get what they want.”
  • NCEO (National Center for Employee Ownership) — Source for Eric’s ESOP economy data.
  • Certified EO — Article referenced on creating an employee-owned economy.
  • Zingerman’s / Ari Weinzweig — Perpetual purpose trust as the structure beyond ESOP.
  • Paragus IT / Delcy Bean — Fellow IT founder going to 100% ESOP this year.
  • Small Giants Community — Where Ryan met both Eric and Tom Walter.
  • Tom Walter & Kevin Walter — Tom on Intentional Growth previously; Kevin coached WebIT through Open Book.
  • Jack Stack / Great Game of Business — Referenced on the Inc. 5000 and payroll fragility.
  • Corey Rosen — Recent Intentional Growth guest on ESOPs.

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