Zebras: Why the Best Customers are Hiding in Plain Sight

As an advisor looking to grow your practice, you’ve likely encountered two extremes: large businesses with more than $10 million in revenue (we call those “Whales”) and “Chipmunks,” which are small businesses earning less than $1 million. More prominent companies may have deeper pockets, but their decision-making process can be slow, and they often already have internal advisors, investors, or a sophisticated C-suite. On the other hand, smaller businesses, while eager for strategic advice, typically can’t afford your services. 

Where does that leave you? According to a recent study by the Value Builder Analytics team, the answer lies in the middle: Zebra businesses—those generating between $1 million and $10 million annually. They are large enough to afford and appreciate your expertise yet still small enough to need it. Like their namesake, Zebras hide in plain sight. Just as lions, with their colorblind vision, confuse a zebra’s stripes for tall blades of grass, these businesses often go unnoticed by advisors who focus on larger companies. But it’s these Zebra businesses that offer the greatest opportunity. 

Now, let’s explore why targeting Zebras could be the key to unlocking growth in your advisory practice. 

Understand Your Upside

The first step is to understand the upside of targeting Zebras. Recent data from the NAICS Association reveals that Zebras account for approximately 934,000 businesses in the U.S., compared to about 181,000 Whale businesses and 15.2 million Chipmunks. While Chipmunks vastly outnumber Zebras, they often lack the budget to afford strategic advisory services. Advisors can easily spend too much time providing advice to Chipmunks without a reasonable return. Outnumbering Whales by a ratio of 5 to 1, Zebras are a prime opportunity for advisors, offering both growth potential and the ability to pay for your services. 

So, how do Zebras compare to the rest of the market? We gathered data from a recent sample of 20,000 business owners who completed The Value Builder questionnaire to arrive at the insights below. If you’re curious about how you can offer the Value Builder Assessment to your clients, you’ll find the details here. Strategically, Zebras differ in some significant ways from Whales and Chipmunks, particularly in their profit and growth expectations: 

Profitability

Zebra businesses are in a unique sweet spot when it comes to profitability. 36% of Zebras report profit margins between 11% and 20%, which is roughly 24% higher than the general business population. This consistent profitability makes Zebras far more financially stable than Chipmunks, who are often strapped for cash. What’s more, Zebras aren’t just stable—they’re half as likely to lose money. Only 6% of Zebras reported a loss last year, compared to 13% of the overall market. 

Revenue Growth Expectations

Zebras generally expect steady, moderate annual growth, outperforming the general business market's expectations. Twenty-nine percent of Zebras project growth of up to 10%, with another 29% expecting growth between 11% and 20%. They are more focused on maintaining sustainable growth compared to Chipmunks, which may be more volatile. Whales, while capable of higher growth rates, typically have more modest expectations due to their size and market saturation. 

Zebras fall in between, representing a stable growth opportunity.

The next question you’re probably asking yourself is, “Where do I find them?” LinkedIn is a great resource, provided you follow a few important steps. Let’s use the example of the Entrepreneur’s Organization (EO), which is a global network of companies with at least $1 million in revenue, to see how this is done. Here’s how you can find EO Zebras using LinkedIn and following these steps: 

1. Use Keywords in the Search Bar: Search for titles like “Owner,” “Founder,” or “CEO” and combine them with “Entrepreneurs’ Organization” or “EO”. 
2. Use Industry-Specific Keywords: Refine your search with keywords like "Founder," "EO," and "Tech" or other industry you're after.
3. Check Company Size: Premium tools like Sales Navigator make this next step easier with filters, but if you’re running the free version of LinkedIn you can manually scan each contact’s company page to check for the number of employees. Zebras typically operate a company with 11-50 employees.
4. Engage with EO Content: Follow hashtags like #EOglobal or #EntrepreneursOrganization and engage with relevant posts. EO members often share insights that can lead to valuable connections. 

Once you find a Zebra, it’s important to understand what they’re looking for when you pitch them on your services. Zebras are very different animals from other business owners, and it's crucial to understand what sets them apart when pitching to them. Zebras prioritize working with advisors with a deep understanding of their specific industry. In fact, six in ten Zebra owners prioritize advisors with a proven track record of success in their field, making industry expertise the most important factor in their decision-making process. 

This preference means that generalist advice won’t resonate with them. Zebras aren’t looking 

for broad strategies—they want advisors who know the nuances of their market and can provide tailored solutions to the specific challenges they face. By focusing your expertise on a particular industry, you become far more relevant to their needs. Specializing in a six-digit NAICS code, for example, positions you as the go-to expert who understands their pain points and can help them maximize profit margins and ensure long-term operational stability. 

So, how can you best work with Zebras? They often face complex challenges but have limited internal resources to help them navigate those issues. Unlike Whales, Zebras rarely have investors, boards, or C-level managers to rely on for strategic advice, which is why they turn to external advisors like you to be their trusted sounding board. With fewer internal decision-makers, Zebras are more dependent on external expertise to help them streamline operations, reduce owner dependence, and plan for future growth and profitability. Mastermind workshops can be an effective way to engage Zebra business owners. These workshops bring together Zebras facing similar challenges, allowing them to learn from each other while benefiting from your expert advice. 

While other advisors may focus on chasing Whales, Zebra businesses offer the ideal blend of need and financial capability. Their steady growth, profitability, and openness to strategic advice make them a prime target for advisory services. By focusing on Zebras, you position yourself to serve a large, profitable, and underserved market segment. 

Related Resources:

• Exit Planning Institute Welcomes The Value Builder System as a Strategic Partner
• Top Exit Planning Strategies From the Past 20 Years
• The 5Ws of Exit Planning