Good morning!
Here are today’s highlights:
In this week’s Dashboard episode, David C. Barnett and Josh Patrick have a lively discussion about the merits of the dreaded earnout.
Even OpenAI acknowledges that the ROI on AI is not yet clear.
Family-controlled companies tend to outperform non-family-controlled companies, according to a Goldman Sachs report, but few make it to the third generation under family control.
Businesses are becoming increasingly comfortable rehiring former employees.
MARKETING
Google’s AI overviews can cause chaos for small businesses: “Damian Mansell was stunned to see what Google was saying about his nascent business. When he searched for reviews of The Plastics Shed — the online building-plastics supplier he incorporated at the start of 2025 — the platform’s AI overview said customer feedback was ‘overwhelmingly negative.’ It listed complaints about delayed deliveries, lying staff, and damaged products. While the company had some positive feedback, the summary said, its poor customer service was a ‘significant recurring issue.’ The good news: The reviews weren’t actually about Mansell’s company. They appeared to be for competitors and companies that sold actual plastic sheds. The bad news: He had no idea what to do about it.”
“To make matters worse, Mansell was paying Google about £700 a month to advertise, while the summaries warned people away. Following advice he found on online forums, he repeatedly submitted feedback to Google that the abstract was wrong. After a couple of weeks, it started to improve. AI has been an invaluable tool for him to build out his business, so he doesn’t want to malign the tech in general, but he wishes there were more accountability when things go awry.”
“Google’s AI Overviews are rapidly becoming consumers’ first impression of businesses. Instead of scanning reviews and websites, many users see a single synopsis that purports to blend information from across the internet into a comprehensive digest. When those summaries are inaccurate, misleading, or jumbled, business owners say they can cause serious reputational damage and financial losses, and there’s often little recourse. Mansell still wonders how much business the issue cost him.”
“Search industry professionals say this is a new frontier for businesses. They no longer have to focus so heavily on search rankings but must instead manage the AI’s interpretation of their reputations. It’s not about chasing clicks —it’s about making sure AI knows you exist and is nice and correct about you.”
“In the meantime, business owners are left white-knuckling it, hoping that the mysterious technology at the heart of those AI summaries looks kindly upon them. That’s the case with Mansell, who’s proud to say that Google’s overview of the Plastics Shed is now ‘fantastic,’ just like many of his actual reviews.” READ MORE
THE 21 HATS PODCAST: DASHBOARD
It’s Not That Earnouts Are Bad: Conventional wisdom about selling a business is pretty clear: If at all possible, get your money at closing. Don’t leave a big chunk of the purchase price dependent on the future performance of a business you no longer control. David C. Barnett, who helps people buy and sell businesses, has challenged that conventional wisdom, arguing that earnouts and other forms of deferred payment can sometimes help buyers and sellers get better deals done. Josh Patrick, who has owned and sold businesses himself and advised many other owners through transactions, is more skeptical. Which is why I was kind of hoping for a fight.
Instead, Dave and Josh end up agreeing on quite a lot—including that once a seller decides to leave money in a deal, choosing the right buyer becomes every bit as important as negotiating the right price. Can the buyer actually run the business? What happens if things go wrong? What information should the seller continue to receive? And how can the deal be structured so that both sides have an incentive to make the transition work? So no, this conversation isn’t quite the earnout cage match of my dreams. It’s actually far more insightful than that.
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