There are 176 different industries in the US that require businesses to have some kind of license in order to operate. Failure to keep those licenses up-to-date can mean hundreds of thousands of dollars in fines.
Hampton member Jeff Brewer is the owner of Cornerstone Licensing. They keep clients on top of all the paperwork.
He bought the business two years ago and has led them through a major revitalization including a brand overhaul, improved marketing, new product offerings, and (soon) further acquisitions to grow their reach.
In this piece, he breaks down the whole thing, including:
- His path from Coast Guard, to Consultant, to CEO
- How he got into Angel Investing without money
- Exercises his team used to overhaul the brand/growth strategies
- “Oh sh*t” moments he’s experienced as a leader
- And more…
If you’ve ever thought about a buy-then-build strategy, or if you’re leading a company you acquired recently, you’ll definitely enjoy this look behind the scenes.
Hello! Who are you and what business did you start?
My name is Jeff Brewer, and I am the CEO and owner of Cornerstone Licensing Services.
We leverage our world class team and proprietary software to provide licensing services and related compliance services (Bonds, Registered Agents, Background Checks, and Commercial Insurance) to clients around the world.
We intentionally keep a narrow focus on highly complex, licensed industries such as Money Transmitters, Lending, Mortgage, ARM, and related FinTech businesses as we prefer to provide a greater number of services, with deep expertise and speed, for fewer clients rather than trying to be everything to everyone.
While we don’t publicly disclose our top and bottom-line numbers, our team processes over a hundred thousand filings a year on behalf of our clients. In 2023, we celebrated our 25th year in business with a refreshed brand, new website, and a massive new investment in our technology to enhance the capabilities of our software.
In addition to Cornerstone, I own and/or manage a variety of other small businesses that I’ve invested in or acquired over the years, and I’m passionate about supporting purpose-built companies focused on improving the lives of our employees. My wife and I live on a small farm in Indiana w/ our five kids.
What's your backstory and how did you come up with the idea?
I started my career chasing drug runners and pulling people out of the water in the US Coast Guard. My family didn’t have much while I was growing up, so the only way I was going to be able to afford college was to go into the military.
After an incredibly fun, adventurous 14 years in uniform, I joined General Electric (GE) where, after several roles, I had my first exposure to running a business. I led a global services startup within GE where I had to figure out how to start a world-wide services business for utility scale electrical equipment in less than 12 months.
I was recruited out of GE by a big 3 consulting firm to join their ranks with a focus on M&A, leadership, and Ops strategy work for major multinationals.
While I enjoyed my ‘day job’ working in and consulting to the Fortune 500, my life changed when a friend invited me to an angel investing event in Atlanta. While I didn’t have money to invest (I was only a year out of a military salary), I immediately fell in love with the entrepreneurs and their journeys to take something from ‘zero to one’.
After seeing one amazing duo present (poorly) and not raise any funds, I realized I could help them w/ some of my experiences. Because I already had enough to support my family from my salary, I asked them if I could join their team, part time, in exchange for equity.
They agreed, and I became the first ‘investor’ in Good Spread (www.HelpGoodSpread.com).
After some refinement work, we ended up raising a few million to launch the company in earnest. We had a great relationship, and they shared this story w/ another entrepreneur in the Angel investing group who approached me to do the same work with them.
After a few years, I ended up gaining ‘sweat equity’ in five different startups as I was also doing a normal W2. Needless to say, I didn’t sleep much in those days.
After a few years of leading this dual life, I knew my I needed to leave the corporate world and dive fully into small business leadership.
While I don’t know if I’ll ever start my own business from scratch, I’m passionate about scaling up quality teams and businesses. Several years ago, I found the perfect opportunity and went all in to acquire my own business, Cornerstone Licensing Services.
The Cornerstone team has built decades of experience performing licensing services in the Accounts Receivable Management (ARM) industry – one of the most difficult, most regulated industries in the country.
This small team of fifty had grown to dominate the space with market share 3x the size of the next largest competitor. They did this using outstanding software, deep compliance expertise, and amazing customer service. I’ve been fortunate that my investment thesis (if they can do licensing for the ARM industry, they can do it anywhere) has been proven right, and we have been growing quickly. We now are on track to add at least one new industry each year as we aspire to become the most trusted name in licensing in the country.
Take us through the process of building and launching the first version of your product.
While our customer retention (>12 years) and client satisfaction (top quintile NPS scores) were outstanding, we knew we needed to relook at our branding, website, customer journeys, and tech roadmap if we were going to begin entering new industries and services.
Refreshing the brand was relatively straightforward (after getting the internal team onboard), and it became easier still when you realize the old brand was using a ‘keystone’ as its reference point, not a ‘cornerstone.’
We spent time reviewing our aspiring future industries to see what brands were successful and how they marketed themselves, but we also wanted to retain what made Cornerstone special. A ‘cornerstone’ is a great object to build a logo around because it was used as a focal point for building a strong foundation, something clearly analogous to what we were building as a global compliance firm.
Building out the website took significantly more time as we were continually balancing the volume of information w/ a clear, compelling call to action for our prospects. Our business offers twelve different services and a half a dozen subservices, e.g. insurance products for E&O, cyber, Gen Liability, and others. And to complicate it further, we were moving from a focused effort around one industry to providing support in multiple industries.
To accomplish this, we ended up hiring an outstanding Digital Marketing leader w/ a decade of experience building websites and digital marketing programs. We knew our website would cost close to six figures by the time it was built out, and I felt that investing in someone to fully own it and the digital marketing effort in house was worth it.
Building out the website took significantly more time as we were continually balancing the volume of information w/ a clear, compelling call to action for our prospects. Our business offers twelve different services and a half a dozen subservices, e.g. insurance products for E&O, cyber, Gen Liability, and others. And to complicate it further, we were moving from a focused effort around one industry to providing support in multiple industries.
To accomplish this, we ended up hiring an outstanding Digital Marketing leader w/ a decade of experience building websites and digital marketing programs. We knew our website would cost close to six figures by the time it was built out, and I felt that investing in someone to fully own it and the digital marketing effort in house was worth it.
By far the most complex transition was a hard look at how we performed our services, the tools we used, and, most importantly, the customer experiences related to each and every aspect of the customer journey.
This process touched nearly every employee and forced honest, challenging conversations around the quality we were currently providing in each interaction. Adding to the challenge, we wanted to better understand when and how technology could improve each process.
Our client interviews showed us weaknesses many of us didn’t know we had, and also opened our eyes to recent changes in customer preferences. Many long-time clients loved our hands-on approach as licensing can be exceedingly complex, however many of our newer clients preferred more self-service options.
We began by building out our ‘cradle to grave’ customer journey map during an in-person meeting using a lot of sticky notes, markers, and white boards. We then converted those to a lucid chart and continued to build and refine the issues and opportunities as well as the priorities for each of the changes needed.
Then the real work began as we began seeking out feedback from our clients. As typical, this step provided major new insights into what and how we needed to continue to refine and improve our processes. We all know the value of agile style, rapid iterations, but we still found ourselves looking for silver bullets w/ AI or major new software add-ons.
When we spent time w/ our clients and employees, we found they strongly preferred a steady stream of micro improvements across a variety of categories. The bite-sized improvements, easy to understand and value, didn’t require significant investments in time and learning, but immediately improved the lives of both groups.
Finally, we refined our views and built out a cleaner, clearer Journey map. As much as I’d like to say we’ve “finished” this project, the truth is that it is constantly changing and being updated as customer preferences change and employees find new weaknesses in the tech or tools. That said, going through this effort has provided us w/ a much clearer picture of where we are today (good and bad) and where we need to go to take the company to the next level.
Since launch, what growth channels have been most effective for you?
Our growth strategy consists of three primary channels; SEO/PPC optimization, partnerships, and acquisitions. With our newly built website, new digital ad strategy, and new online channels, we’ve seen a marked improvement in our organic and PPC traffic.
Better still, the new website is leading to 3-4x the conversion rate and has tripled our pipeline value in the first three months after launch. With greater tracking abilities and a better intake form, we are also able to see future growth opportunities in industries and services.
Partnership is another, relatively untapped, channel for our team that we are excited to continue to build on. Soon after purchasing the company, I was shocked at the number of ‘part-time’ license service firms out there.
These companies, typically law firms or other compliance service providers, treated it like an afterthought or way to increase their billable hours. It was immediately apparent that our team, with our longtime Licensing Specialists employees and purpose-built software, could do the job far better with far less cost.
While these law firms would hate to compete (and lose the licensing income to us), there are many who happily would use a white label licensing service that we could easily provide. As we’ve entered new markets, we’ve seen several other licensing service firms use this same strategy to grow quickly, and we plan to continue to use this method in multiple new markets.
Finally, acquiring existing players in new markets will be a major part of our strategy going forward. Being able to leverage their industry-specific expertise w/ our software, marketing, and processes is an easy win-win for Cornerstone and the acquisition target. We are currently in talks with several of these opportunities, and we hope to continue to use this method in multiple different industries.
Did you ever have an “oh shit” moment where you thought it wouldn’t work?
While Cornerstone has certainly gone through plenty of difficult moments, I’ll share a personally challenging situation that really knocked me back. Investing and leading businesses has been one of the most exciting, enjoyable, fulfilling experiences of my life, but most don’t know that I was fired from my last two jobs.
Big 3 consulting firms are filled with incredibly smart, capable people, but folks who want to be lifelong consultants and people who want to start and build companies rarely sync well together. While I wasn’t fired in the traditional sense (it’s more up or out for these companies), a partner there made it clear the reason I wasn’t promoted. “At the end of the day Jeff, you’re trying to lead, not consult.”
While it was heartbreaking to hear at the time (first time I had ever been fired), he was exactly right. I wasn’t good at doing an analysis, pitching a deck, and then walking away. I wanted to invest in and support that client team for the long run, and it was difficult for me not have skin in the game.
Following that role, I moved to a LMM business where I had a leadership role (COO), and I was responsible for hundreds of outstanding employees as we professionalized and scaled up the business. After two years of outstanding growth and success, a disagreement over accountability for a long-term employee’s continued unacceptable conduct led to them firing me instead of him (yes, I was shocked!).
But ultimately, thankfully, it led me to realize where I was meant to be. Leading and serving in ultra high integrity, high quality businesses that focus on doing the right thing every time. I never would have realized, or appreciated, this if I hadn’t gone through the challenges that I did in my other roles. Sometimes doors closing can be one of the best things to ever happen to you.
Can you break down the keys to this business model for us? What makes it work? And What do outsiders typically not understand about your industry?
Licensing work is ever changing because each state does things their own way and w/ each new politician, there is a new set of priorities. You need a team that can thrive in that dynamic environment while also enjoying diving into the details. The combination of those two things is such a rare combination, and it takes a ton of effort and time to find, hire, train, and retain them.
Another important aspect of the business is continuing to keep a clear understanding of client needs, and, where appropriate, flexing to the needs of the clients. Nearly all our additional business services (insurance, bonding, registered agents, etc.) came from client ideas / requests. Most customers are looking for a one-stop solution for all their compliance needs.
The firm needs to understand what should and should not be part of that portfolio of services. If you don’t have enough services, you won’t provide enough value to your clients. If you try to offer too broad a set of services, you could never perform those services well. And when it comes to compliance, a small miss by our team could result in hundreds of thousands of penalties and fines for our clients.
What have been the most influential books, podcasts, or other resources?
My father and grandfather were both military officers and then pastors, but I followed my military career by going into the business world, not the church. This different path didn’t change my passion for my faith or my desire to serve and care for the people around me. The Bible is filled w/ content on work, money, and how to lead a good life. It is by far the most influential book in my life.
I was given the advice decades ago to read an hour before bed each night. I rarely stay awake for a whole hour these days, but I’m never w/out a book on the bedside table. I read a lot of biographies (Teddy Roosevelt, Churchill), business books (Who, Measure What Matters, 80/20 Principle), historical travel fiction (Shogun, The Far Pavilions), and some Science Fiction (Dune, Seveneves, Red Rising).
And I’m a podcast junkie. I love to listen on a run or during a drive. Some favorites are: MFM (of course), Acquired, Rewatchables, All-in, Invest Like the Best, Huberman, Tim Ferriss, Hardcore History, and Crazy Love.
What are some strong opinions you have about leadership, and how do you actually put those into practice in your company?
There is almost no topic I am more passionate about than leadership. I’ve been blessed to be in a wide variety of leadership roles in my life (captain of ship, board chair, CEO, husband and father to an amazing family), and I firmly believe the quality of an organization directly reflects the quality of the leadership. If there is something wrong, the buck stops w/ the leader.
I believe the best form of leadership is servant leadership. A leader, regardless of the context, is there to serve the members of the organization, whether they be employees, shareholders, volunteers, customers, vendors, or family members. If a leader isn’t actively working to support the needs of their team, they aren’t doing their job. I know the popular thing these days is self-care, but when I look back, my best days were when I (or our team together) prioritized and served the needs of the team or project over the individual. My worst days are when I prioritized myself.
Another one of my leadership favorites is skill, will, hill. If a member of the team makes a mistake, I love the question, “Is it Skill, Will, or Hill?” In other words, were they given the right skills to do the job? Were they properly motivated to do the job (Will)? Or was the job itself actually something that could not have been accomplished (Hill)? Just asking that simple question when someone made a mistake in your organization quickly gives insight and helps move towards a solution.
Finally, a leader must help an organization understand its purpose. Casting vision, helping explain ‘why’, and connecting the dots for the team is something that the leader is uniquely responsible for and can share with other leaders, but never delegate away. I’m always interested to hear from a CEO about their business, but I love hearing from leaders about their purpose.
Where can we go to learn more?
Personally, I find being the CEO of a startup to be downright exhilarating. But, as I'm sure you well know, it can also be a bit lonely and stressful at times, too.
Because, let's be honest, if you're the kind of person with the guts to actually launch and run a startup, then you can bet everyone will always be asking you a thousand questions, expecting you to have all the right answers -- all the time.
And that's okay! Navigating this kind of pressure is the job.
But what about all the difficult questions that you have as you reach each new level of growth and success? For tax questions, you have an accountant. For legal, your attorney. And for tech. your dev team.
This is where Hampton comes in.
Hampton's a private and highly vetted network for high-growth founders and CEOs.
