47: How Consulting Firms Scale Under Private Equity with Karen Thomas-Bland

1 00:00:00,479 - > 00:00:02,640 Joe: Welcome to the Consulting Growth Podcast. 2 00:00:02,720 - > 00:00:06,160 I'm Professor Joe O'Mani, CEO of Equity Sherpa. 3 00:00:06,240 - > 00:00:09,679 We help owners of consultancies quadruple the equity value of 4 00:00:09,679 - > 00:00:11,759 their firms over a two to four year period. 5 00:00:11,919 - > 00:00:15,759 If you'd like to know how we do this, visit equitysherpa.com. 6 00:00:16,239 - > 00:00:19,679 Okay, welcome back to the Consultancy Growth Podcast, 7 00:00:19,760 - > 00:00:20,320 everyone. 8 00:00:20,480 - > 00:00:24,719 Um I I've I've followed our guest here for some time on 9 00:00:24,719 - > 00:00:27,519 LinkedIn, and I would encourage you to do so. 10 00:00:27,839 - > 00:00:32,960 I find her insights, I mean her experience is fantastic, but her 11 00:00:32,960 - > 00:00:37,920 insights, especially in this these days of AI slop, her 12 00:00:37,920 - > 00:00:42,240 insights are fantastic, intelligent, and are clearly 13 00:00:42,240 - > 00:00:46,240 based on a long period of deep experience. 14 00:00:46,399 - > 00:00:51,600 So I've got the real pleasure of um welcoming Karen Thomas Bland. 15 00:00:52,079 - > 00:00:54,399 Um Karen, welcome to the podcast. 16 00:00:54,799 - > 00:00:57,280 SPEAKER_00: Oh, what great to be here, Jo, and thank you for that 17 00:00:57,280 - > 00:00:59,679 very kind introduction about my LinkedIn. 18 00:01:00,000 - > 00:01:02,960 Joe: Well, I did I I I I genuine I genuinely mean it. 19 00:01:03,119 - > 00:01:09,120 I you know, I I I'm keen on evidence-based insights, and you 20 00:01:09,120 - > 00:01:10,799 certainly provide them. 21 00:01:11,040 - > 00:01:15,519 Um now you you you you've had an interesting career and have an 22 00:01:15,519 - > 00:01:16,560 interesting CV. 23 00:01:16,640 - > 00:01:19,920 So rather than me mash it up, I was wondering if you could give 24 00:01:19,920 - > 00:01:23,760 us a little introduction to yourself and how you got to 25 00:01:23,760 - > 00:01:24,719 where you are today. 26 00:01:25,040 - > 00:01:26,799 SPEAKER_00: Yes, absolutely, Joe. 27 00:01:26,879 - > 00:01:29,519 Well, I'll I'll work my way backwards, which is probably 28 00:01:29,519 - > 00:01:30,000 easier. 29 00:01:30,159 - > 00:01:34,959 So for the last 15 years, I've been operating independently and 30 00:01:34,959 - > 00:01:37,200 I've operated really in two tracks. 31 00:01:37,359 - > 00:01:42,000 So one is private equity, non-exec, um, and chair roles. 32 00:01:42,319 - > 00:01:46,560 And they would be uh in the mid-market, classically B2B 33 00:01:46,640 - > 00:01:50,000 services and technology, but particularly consulting 34 00:01:50,000 - > 00:01:52,480 businesses, which is my heartland. 35 00:01:52,959 - > 00:01:57,359 And the second track is I go into perhaps larger CAP PE and 36 00:01:57,519 - > 00:02:01,840 the listed world and take businesses on a transformation 37 00:02:01,840 - > 00:02:04,640 or integration or carve-out journey. 38 00:02:04,799 - > 00:02:07,280 So classically, they're buying another big business and want 39 00:02:07,280 - > 00:02:08,960 someone to come and integrate it. 40 00:02:09,120 - > 00:02:13,120 Or they say, we want to go on a value creation or transformation 41 00:02:13,120 - > 00:02:13,520 journey. 42 00:02:13,599 - > 00:02:14,639 We're currently here. 43 00:02:14,800 - > 00:02:17,759 They may have thought about where they want to get to go and 44 00:02:18,000 - > 00:02:20,159 want someone to make that happen, or they may not have 45 00:02:20,159 - > 00:02:22,960 thought about where the end game is, or they're classically 46 00:02:22,960 - > 00:02:25,599 saying we want to carve this business out. 47 00:02:25,759 - > 00:02:29,919 And my clients have ranged, yes, from private equity to listed 48 00:02:29,919 - > 00:02:30,719 businesses. 49 00:02:31,039 - > 00:02:36,000 Prior to that, I was in the US, I was in IBM, um, doing actually 50 00:02:36,000 - > 00:02:40,159 a relatively similar role, um, either integrating businesses, 51 00:02:40,240 - > 00:02:44,560 so did 10 acquisitions during that time, or I was running as 52 00:02:44,560 - > 00:02:46,560 the general manager those businesses. 53 00:02:46,639 - > 00:02:49,680 And classically, it was a combination of consultancy, 54 00:02:50,000 - > 00:02:52,000 data, and technology. 55 00:02:52,319 - > 00:02:53,360 Took me all around the world. 56 00:02:53,439 - > 00:02:57,039 I did a stint in Dubai in our growth markets, a stint in 57 00:02:57,039 - > 00:02:59,680 Brazil, uh, doing a classic kind of turnaround. 58 00:02:59,759 - > 00:03:03,280 So it was one of those global roles, uh, fantastic, build a 59 00:03:03,280 - > 00:03:04,319 lot of experience. 60 00:03:04,560 - > 00:03:08,639 Prior to that, I was in KPMG here in the UK. 61 00:03:08,879 - > 00:03:12,639 Um, it had sold its consulting business off to Atos, and like 62 00:03:12,960 - > 00:03:16,319 all good uh businesses where they sell off, they decide to 63 00:03:16,319 - > 00:03:18,319 rebuild that consulting practice again. 64 00:03:18,400 - > 00:03:21,680 So I went in very early to build out uh strategy and 65 00:03:21,680 - > 00:03:23,680 transformation practice there. 66 00:03:23,840 - > 00:03:27,919 And then before that, I was in uh smaller consultancies. 67 00:03:28,080 - > 00:03:31,759 Um, I have a very unusual background for what I ended up 68 00:03:31,759 - > 00:03:32,080 doing. 69 00:03:32,159 - > 00:03:35,360 I trained as an organizational psychologist, so I still had two 70 00:03:35,520 - > 00:03:38,240 years doing a psychology degree and master's, two years of 71 00:03:38,240 - > 00:03:41,199 practitioner in training, and you apply and become a chartered 72 00:03:41,199 - > 00:03:42,159 psychologist. 73 00:03:42,319 - > 00:03:44,080 Um, so that's not the usual route. 74 00:03:44,159 - > 00:03:46,800 Normally people come through a business or or finance 75 00:03:46,800 - > 00:03:50,080 background, but I did specialise in the organizational side of uh 76 00:03:50,080 - > 00:03:54,080 psychology, so the people side of a lot of change, or 77 00:03:54,240 - > 00:03:58,960 development, assessment, and that personality uh kind of 78 00:03:59,120 - > 00:04:03,039 discipline actually really does help you along uh the way as you 79 00:04:03,039 - > 00:04:04,159 navigate challenges. 80 00:04:04,240 - > 00:04:06,960 But yeah, that that's that's the background in a nutshell. 81 00:04:07,280 - > 00:04:10,560 Joe: And just just just as an aside, that that psychology 82 00:04:10,560 - > 00:04:10,960 background. 83 00:04:11,039 - > 00:04:15,759 Now, I I I I wanted to be a an organizational psychologist, and 84 00:04:15,759 - > 00:04:17,759 I did do a little bit in that area. 85 00:04:17,920 - > 00:04:21,920 Did did you do much quant side or was it primarily soft stuff? 86 00:04:22,319 - > 00:04:24,399 SPEAKER_00: No, it's a it's a good discipline. 87 00:04:24,480 - > 00:04:27,279 Uh, I'm not here to sell this to anyone listening, but it's a 88 00:04:27,279 - > 00:04:28,399 good discipline in both. 89 00:04:28,480 - > 00:04:33,439 So it's a good discipline for research statistics, that real 90 00:04:33,439 - > 00:04:36,800 analysis around problems, it gives you that, and and you need 91 00:04:36,800 - > 00:04:40,480 a good, you know, numerical background to be able to take 92 00:04:40,480 - > 00:04:41,040 that on. 93 00:04:41,199 - > 00:04:44,959 Um, but it also then gives you the uh what's often classically 94 00:04:44,959 - > 00:04:48,000 referred to, as you say, as that's that softer side, that 95 00:04:48,000 - > 00:04:49,839 empathy, that understanding. 96 00:04:50,079 - > 00:04:52,639 But the most important thing it gives you is how to go in and 97 00:04:52,639 - > 00:04:54,240 diagnose personality. 98 00:04:54,399 - > 00:04:57,759 So whoever you're working with, you can build a good 99 00:04:57,759 - > 00:05:02,560 understanding and orientate your own style in how you might work 100 00:05:02,560 - > 00:05:02,879 with people. 101 00:05:02,959 - > 00:05:05,600 And let's be honest, Joe, you know, the further up in an 102 00:05:05,600 - > 00:05:09,199 organization you go, the higher likelihood you will be to get to 103 00:05:09,199 - > 00:05:11,439 work with, you know, higher conflict personalities. 104 00:05:11,519 - > 00:05:12,959 It's just part of the game, right? 105 00:05:13,120 - > 00:05:14,959 So it's good for that as well. 106 00:05:15,199 - > 00:05:17,839 Joe: Yes, there was that wonderful piece of research 107 00:05:17,839 - > 00:05:22,480 about 20 years ago that correlated um uh sociopathic 108 00:05:22,639 - > 00:05:25,839 behavior with the higher you got in the organization. 109 00:05:26,000 - > 00:05:28,959 Um I think that would be a generalization, of course, but 110 00:05:28,959 - > 00:05:31,199 um there was some correlation there, I think. 111 00:05:31,600 - > 00:05:33,839 Yeah, yeah, brilliant. 112 00:05:34,000 - > 00:05:36,160 Okay, listen, that's fantastic, Karen. 113 00:05:36,319 - > 00:05:39,360 So so obviously, you know, a lot of listeners to this podcast are 114 00:05:39,680 - > 00:05:43,279 have have been been through that process, you know, selling their 115 00:05:43,279 - > 00:05:46,240 firm and have been come out the other side, but many of them 116 00:05:46,240 - > 00:05:49,360 haven't um and and would like to. 117 00:05:49,519 - > 00:05:53,279 Um, and you know, PE, especially these days, as you know, is a 118 00:05:53,279 - > 00:05:55,839 much bigger force than it was 20 years ago. 119 00:05:55,920 - > 00:05:59,519 So I'm interested in the difference between what you 120 00:05:59,519 - > 00:06:06,800 would see um prior to uh a sale to PE and post. 121 00:06:07,199 - > 00:06:10,879 So uh other than the cash that you've got splashing round that 122 00:06:10,879 - > 00:06:14,399 you can you can invest in different things, what are the 123 00:06:14,399 - > 00:06:20,560 big changes that occur either through the PE board um or the 124 00:06:20,560 - > 00:06:23,519 board member, someone like yourself being involved? 125 00:06:23,680 - > 00:06:29,920 Um uh and and how should owners prepare for that, I guess? 126 00:06:30,319 - > 00:06:32,639 SPEAKER_00: Yeah, look, Joe, I think it's a great question. 127 00:06:32,800 - > 00:06:35,600 Look, I think if you're a founder, you've not got P 128 00:06:35,759 - > 00:06:38,160 backing or any other finance at the moment. 129 00:06:38,399 - > 00:06:42,000 The biggest difference you'll find is not the cash, I say, but 130 00:06:42,000 - > 00:06:42,720 the clock. 131 00:06:42,959 - > 00:06:45,279 So as a founder, you're empowered. 132 00:06:45,360 - > 00:06:48,319 You make your own decisions on your own time frame. 133 00:06:48,639 - > 00:06:51,120 You perhaps you know have a management team meeting, 134 00:06:51,279 - > 00:06:55,199 whatever frequency you've deemed to be appropriate for that. 135 00:06:55,519 - > 00:06:59,279 P investment comes with much more operational discipline in 136 00:06:59,279 - > 00:06:59,759 the business. 137 00:06:59,920 - > 00:07:03,360 So prepare yourself for a monthly board, I always say. 138 00:07:03,519 - > 00:07:07,439 Um, and that board in advance, you will have sent a detailed 139 00:07:07,439 - > 00:07:11,199 pack of information, a lot of financial information, get him 140 00:07:11,199 - > 00:07:13,839 better and put him a lot more operational and people in 141 00:07:13,839 - > 00:07:14,240 position. 142 00:07:14,800 - > 00:07:17,920 But classically, they want to know how the business has traded 143 00:07:18,000 - > 00:07:21,439 and how is it likely to trade over the next um month. 144 00:07:21,680 - > 00:07:23,439 So I think that's definitely one thing. 145 00:07:23,600 - > 00:07:26,079 Yeah, to reporting expectations change. 146 00:07:26,240 - > 00:07:28,240 You are now being held to account. 147 00:07:28,319 - > 00:07:30,879 And for founders who've done their own thing, that that is a 148 00:07:30,879 - > 00:07:32,639 shift to kind of make. 149 00:07:32,959 - > 00:07:35,920 Um I think uh decision rights is another one. 150 00:07:36,000 - > 00:07:41,120 So so classically, my experience of uh founder-led consultancies, 151 00:07:41,519 - > 00:07:46,160 you are as one fantastic founder often who will have made 152 00:07:46,160 - > 00:07:48,480 ultimately the apex for all of the decisions. 153 00:07:48,639 - > 00:07:50,959 Suddenly there's a board now with P on. 154 00:07:51,120 - > 00:07:54,639 You've perhaps got one or two independent non-execs, you might 155 00:07:54,639 - > 00:07:57,040 have you definitely have your CFO, made the others of the 156 00:07:57,040 - > 00:07:57,600 management team. 157 00:07:57,680 - > 00:08:01,519 So suddenly decisions are now being made in a collective, not 158 00:08:01,519 - > 00:08:02,240 as an individual. 159 00:08:02,319 - > 00:08:04,959 And for a founder, that can often feel challenging. 160 00:08:05,279 - > 00:08:06,720 In many ways, it feels good. 161 00:08:06,800 - > 00:08:10,959 You know, I've got a broader sounding uh body here, but you 162 00:08:10,959 - > 00:08:13,920 were once used to making it on your own and and now you don't. 163 00:08:14,160 - > 00:08:17,040 I'd say from a people perspective, Joe, the other 164 00:08:17,040 - > 00:08:20,399 thing is, and I hear this often as the way the business is 165 00:08:20,399 - > 00:08:24,959 described, often the term we're a family is is often used in 166 00:08:24,959 - > 00:08:25,920 these smaller firms. 167 00:08:26,000 - > 00:08:28,639 And it's great because everyone knows each other. 168 00:08:28,879 - > 00:08:33,120 The founder probably recruited most of them, um, and it feels 169 00:08:33,120 - > 00:08:36,159 like a kind of cosy um space. 170 00:08:36,320 - > 00:08:38,799 Not to say performance is not there, but it tends to have a 171 00:08:38,799 - > 00:08:39,440 different feel. 172 00:08:39,600 - > 00:08:43,279 When P come in, it suddenly becomes about scale. 173 00:08:43,519 - > 00:08:47,840 So that founder family now becomes scalable business. 174 00:08:47,919 - > 00:08:51,360 And again, that's a um a shift to be made. 175 00:08:51,440 - > 00:08:55,120 And I always say, look, I think the first, if I think about the 176 00:08:55,120 - > 00:08:58,320 founders I've worked with, I would say the first six to eight 177 00:08:58,320 - > 00:09:00,960 months is probably the most challenging because you're in 178 00:09:00,960 - > 00:09:04,320 that period of now operating in a different way, being 179 00:09:04,320 - > 00:09:07,919 accountable, having more KPIs that are being looked at. 180 00:09:08,080 - > 00:09:10,480 Um, it does tend to then find its rhythm. 181 00:09:10,720 - > 00:09:14,080 You sort of settle in and it becomes the new normal. 182 00:09:14,320 - > 00:09:17,759 Um but the other thing I would say is be mindful of that flight 183 00:09:17,759 - > 00:09:18,080 risk. 184 00:09:18,159 - > 00:09:22,159 There are some people who are intuitively drawn to these very 185 00:09:22,399 - > 00:09:24,960 young entrepreneurial businesses, and they carry with 186 00:09:24,960 - > 00:09:28,399 it, you know, a lot of fun, a lot of risk, a lot of reward. 187 00:09:28,559 - > 00:09:31,759 Some people are not the right people for that next phase of a 188 00:09:31,759 - > 00:09:35,759 more formula um kind of driven journey where there's more uh 189 00:09:35,759 - > 00:09:36,639 bounds put around. 190 00:09:36,879 - > 00:09:39,919 And look, I think we should always be open and honest about 191 00:09:39,919 - > 00:09:40,480 that with people. 192 00:09:40,960 - > 00:09:44,240 It's not you you might love a certain phase a business goes 193 00:09:44,240 - > 00:09:47,759 in, and a scrappy startup can really appeal to someone with 194 00:09:47,759 - > 00:09:49,600 that next phase of growth. 195 00:09:49,679 - > 00:09:53,919 So I'd say to any founders, you know, uh you might not yet have 196 00:09:53,919 - > 00:09:56,559 the team that's going to be right for your next phase of 197 00:09:56,559 - > 00:09:57,279 journey. 198 00:09:57,600 - > 00:09:59,679 Joe: Yes, I think that's so important. 199 00:09:59,840 - > 00:10:02,480 It was a major talking of psychology, it was a major 200 00:10:02,480 - > 00:10:06,799 self-discovery of mine that I I'm not a scale person. 201 00:10:06,960 - > 00:10:10,399 I I love starting things up, I love growing them to, you know, 202 00:10:10,559 - > 00:10:16,559 however big, but yeah, it's uh and and and that self-knowledge 203 00:10:16,879 - > 00:10:23,120 is important, and ideally you'll have had that prior to to so so 204 00:10:23,120 - > 00:10:25,759 that you've got someone in place who is the right person to scale 205 00:10:25,759 - > 00:10:25,919 it. 206 00:10:26,879 - > 00:10:27,759 Yeah, great. 207 00:10:27,919 - > 00:10:30,000 And and you mentioned KPIs. 208 00:10:30,399 - > 00:10:34,480 What what are the now we will both have had experiences where 209 00:10:34,480 - > 00:10:37,840 you look at reporting and you think, oh my god, there's 210 00:10:37,840 - > 00:10:40,320 nothing here that you know I I really want? 211 00:10:40,720 - > 00:10:49,679 But but um in terms of the uh major KPIs that perhaps founders 212 00:10:49,919 - > 00:10:54,159 aren't aware that they should be reporting on at that senior 213 00:10:54,159 - > 00:10:58,720 level, that you would probably insist on at post-transaction. 214 00:10:59,200 - > 00:11:05,200 What might some of those be that most founders or many founders 215 00:11:05,360 - > 00:11:08,639 might not be reporting on prior to the transaction? 216 00:11:09,039 - > 00:11:11,360 SPEAKER_00: Yeah, no, great, great question, Jo. 217 00:11:11,519 - > 00:11:14,960 Look, I think um there perhaps are thinking about it, but I 218 00:11:14,960 - > 00:11:17,840 would really be measuring employee attrition just by what 219 00:11:17,840 - > 00:11:18,639 we've just said. 220 00:11:18,960 - > 00:11:23,679 Your flight risk in the first months after deal really will 221 00:11:23,679 - > 00:11:26,480 tell you some people will will start to leave the business. 222 00:11:26,559 - > 00:11:31,519 And so you're really saying, you know, how um how risky is this 223 00:11:31,600 - > 00:11:32,399 um going out? 224 00:11:32,480 - > 00:11:36,080 So I'd say employee attrition, uh particularly as often there's 225 00:11:36,080 - > 00:11:38,000 deep seated relationships. 226 00:11:38,159 - > 00:11:39,840 Um client concentration. 227 00:11:39,919 - > 00:11:43,600 I don't think I've been through a P due diligence where uh the 228 00:11:43,600 - > 00:11:45,840 client concentration measures not looked at. 229 00:11:45,919 - > 00:11:48,639 Again, I'm not saying not everyone would look at this, but 230 00:11:48,639 - > 00:11:51,679 um often we find a great customer and we do a lot of work 231 00:11:51,679 - > 00:11:53,519 with that customer, it's fabulous. 232 00:11:53,679 - > 00:11:56,960 But P look for have you done that and replicated it with 233 00:11:56,960 - > 00:12:00,080 three other customers to show that you can, you know, sort of 234 00:12:00,240 - > 00:12:00,559 scale. 235 00:12:00,639 - > 00:12:04,799 So say that is another uh pipeline conversion. 236 00:12:05,360 - > 00:12:09,440 So uh again, perhaps you are looking at this, but how much of 237 00:12:09,440 - > 00:12:10,480 your actual pipeline? 238 00:12:10,639 - > 00:12:13,759 Are you good at being able to say what's hot in that pipeline 239 00:12:13,759 - > 00:12:14,559 and what's not? 240 00:12:14,720 - > 00:12:18,159 And how much of that pipeline do you actually um convert? 241 00:12:18,240 - > 00:12:21,840 Again, P will be very interested in that um conversion 242 00:12:21,840 - > 00:12:22,879 percentage. 243 00:12:23,120 - > 00:12:25,840 Um, also the length of your sales cycle. 244 00:12:26,080 - > 00:12:30,799 So again, um often that is not looked at in my experience. 245 00:12:30,960 - > 00:12:34,720 How long is the deal or potential deal sitting there? 246 00:12:34,799 - > 00:12:39,360 Um, and it tells you a lot about how quick again you are to um 247 00:12:39,360 - > 00:12:42,080 convert and how long decision-making cycles might be. 248 00:12:42,159 - > 00:12:45,360 And I think everyone on this call who's in consulting knows 249 00:12:45,360 - > 00:12:48,559 that in difficult times decisions do get delayed further 250 00:12:48,559 - > 00:12:49,120 and further. 251 00:12:49,279 - > 00:12:52,159 So one to definitely be looking at. 252 00:12:52,320 - > 00:12:54,399 Um gross margin, I would say. 253 00:12:54,480 - > 00:12:58,720 So looking at gross margin by client, by service line, by 254 00:12:58,720 - > 00:12:59,840 geography. 255 00:13:00,000 - > 00:13:03,600 Um, utilisation's always hot, but I think in consulting that 256 00:13:03,600 - > 00:13:06,240 does tend to get pretty well tracked. 257 00:13:06,399 - > 00:13:08,399 Um, it might not get as tracked. 258 00:13:08,559 - > 00:13:13,440 So PE will look at um utilization classically by band, 259 00:13:13,919 - > 00:13:16,240 um, and how is that tracking? 260 00:13:16,399 - > 00:13:19,200 Um, again, revenue per head is another one. 261 00:13:19,360 - > 00:13:21,919 Again, some businesses don't tend to look at it at the 262 00:13:21,919 - > 00:13:24,559 granular individual um level. 263 00:13:24,720 - > 00:13:28,559 And then you've got your eBid DAR bridge and synergy tracking. 264 00:13:28,720 - > 00:13:32,159 So not just current performance, but over the course of the deal, 265 00:13:32,399 - > 00:13:34,879 how is your EBITDA tracking? 266 00:13:35,039 - > 00:13:38,720 Um, and it's always a tough one because really you don't want to 267 00:13:38,720 - > 00:13:42,559 be taking too much out of the business so that you haven't got 268 00:13:42,559 - > 00:13:43,759 a great culture. 269 00:13:43,919 - > 00:13:48,320 Um, but equally, and and I'd say the one, Joe, I think I find if 270 00:13:48,320 - > 00:13:51,360 I'm saying universally across boutiques, perhaps a little bit 271 00:13:51,360 - > 00:13:54,639 unfairly, it is that price in discipline. 272 00:13:54,879 - > 00:13:59,759 So um we have a tendency, I think, to not want to charge too 273 00:13:59,759 - > 00:13:59,919 much. 274 00:14:00,000 - > 00:14:05,440 And so we price our um rate per day of people at a relatively 275 00:14:05,440 - > 00:14:08,399 conservative, lower than sort of big players. 276 00:14:08,639 - > 00:14:11,840 Um, and and that holds our bit downright at a certain level. 277 00:14:12,159 - > 00:14:15,759 Perhaps, you know, that journey a business goes on through from 278 00:14:15,759 - > 00:14:21,200 pricing per person delivering a job to on an outcome, as in what 279 00:14:21,200 - > 00:14:24,159 is the value this is going to do for a business, that tends to be 280 00:14:24,159 - > 00:14:26,720 a journey that businesses need to go on. 281 00:14:27,039 - > 00:14:30,080 Joe: Yeah, that I I really like that point about pricing. 282 00:14:30,399 - > 00:14:33,440 And and I I'm not sure about your experience, but my I I have 283 00:14:33,440 - > 00:14:37,440 no data behind this, but as a gut feel, I would say that 284 00:14:37,440 - > 00:14:41,360 pricing, in terms of levers for eBit DA improvement, yeah, 285 00:14:41,600 - > 00:14:46,639 pricing is probably the least evidenced in boutique firms. 286 00:14:46,720 - > 00:14:48,639 So I don't know if you would chime with that. 287 00:14:49,120 - > 00:14:49,600 SPEAKER_00: 100%. 288 00:14:50,639 - > 00:14:54,639 Joe: And and often when I talk to founders about their pricing, 289 00:14:54,879 - > 00:14:58,240 it will be, well, we've we've always priced it like this. 290 00:14:58,399 - > 00:15:02,799 Or sometimes they'll say, Well, that's what the market pays, but 291 00:15:02,799 - > 00:15:05,840 on the basis of no evidence or a few conversations. 292 00:15:07,360 - > 00:15:08,720 It's interesting, yes. 293 00:15:08,960 - > 00:15:10,240 Um, okay, good. 294 00:15:10,399 - > 00:15:15,600 So, right, um, so uh I'm I'm a I'm a founder, I've I've gone 295 00:15:15,600 - > 00:15:19,759 through the process, um, I've been successful, I've come out 296 00:15:19,759 - > 00:15:20,480 the other side. 297 00:15:20,639 - > 00:15:26,720 Now, you and I will both have seen um situations where PE 298 00:15:26,720 - > 00:15:28,399 investment has failed. 299 00:15:28,559 - > 00:15:32,320 Um and sometimes that might be something to do with what 300 00:15:32,320 - > 00:15:35,519 they've bought and the founders and just bad luck, you know, the 301 00:15:35,519 - > 00:15:38,320 founder might leave early or, you know, um the client 302 00:15:38,320 - > 00:15:41,519 concentration, you know, they lose a couple of big clients. 303 00:15:41,919 - > 00:15:46,639 But then they're sometimes it's the PE, the issue might be with 304 00:15:46,639 - > 00:15:48,879 the PE themselves and how they manage it. 305 00:15:48,960 - > 00:15:55,120 And one of one of the concerns I hear from my own clients is that 306 00:15:55,120 - > 00:15:58,240 they're worried about the traditional reputation of PE. 307 00:15:58,639 - > 00:16:02,000 Um, that and perhaps that they're more used to tech and 308 00:16:02,000 - > 00:16:06,000 SaaS than they are to people businesses, and they're worried 309 00:16:06,000 - > 00:16:10,480 that the founders are going to end up, you know, working uh 150 310 00:16:10,480 - > 00:16:14,399 FTE uh themselves and everyone's gonna be under the screw. 311 00:16:14,480 - > 00:16:19,120 So what what I guess there's two things. 312 00:16:19,440 - > 00:16:23,759 What differentiates PE approaches that work with people 313 00:16:23,759 - > 00:16:24,240 firms? 314 00:16:24,799 - > 00:16:25,039 SPEAKER_00: Yeah. 315 00:16:25,279 - > 00:16:28,639 Joe: And I guess the other way of looking at that is if you had 316 00:16:28,639 - > 00:16:33,679 a message to give PE firms that were moving more into the people 317 00:16:33,679 - > 00:16:37,360 space now, which many of them are, what advice would you give 318 00:16:37,360 - > 00:16:41,120 them about treating people businesses differently? 319 00:16:41,519 - > 00:16:41,679 unknown: Yeah. 320 00:16:42,480 - > 00:16:43,519 SPEAKER_00: Joe, I think it's a great question. 321 00:16:43,679 - > 00:16:44,960 I think you hit on it right. 322 00:16:45,120 - > 00:16:47,919 Um, interest in management consulting and people-based 323 00:16:47,919 - > 00:16:50,080 business firms has gone wildly up. 324 00:16:50,159 - > 00:16:54,000 Um, so every PE house is is chasing these kind of deals. 325 00:16:54,159 - > 00:16:57,919 Look, I I think the things to talk to them about, what one is 326 00:16:57,919 - > 00:16:59,200 exactly what you said. 327 00:16:59,440 - > 00:17:03,519 Um, a lot of the value sits within the people themselves. 328 00:17:03,679 - > 00:17:07,519 And so uh the conversations need to move away from just talking 329 00:17:07,519 - > 00:17:10,880 about trading updates to let's have a concentrated. 330 00:17:10,960 - > 00:17:13,599 So, one of the things we did on one of my boards, and and we 331 00:17:13,599 - > 00:17:18,000 also brought the HRD on onto the board, is um have a whole 332 00:17:18,000 - > 00:17:21,359 section around people and culture on your board meetings. 333 00:17:21,599 - > 00:17:25,759 So, talk about retention, talk about culture, and if you've got 334 00:17:25,759 - > 00:17:27,920 a diagnostic, what is that telling us? 335 00:17:28,079 - > 00:17:32,559 You know, talk about succession, um, talk about development and 336 00:17:32,799 - > 00:17:33,279 training. 337 00:17:33,440 - > 00:17:36,319 A lot of people put a lot of uh store, particularly in these 338 00:17:36,319 - > 00:17:39,119 businesses, on how are you going to train and evolve and develop 339 00:17:39,119 - > 00:17:42,400 me to the next kind of roles, talk about all of that and 340 00:17:42,400 - > 00:17:43,680 promote your potential. 341 00:17:44,000 - > 00:17:47,359 So I think make it a central part of the governance that P 342 00:17:47,599 - > 00:17:51,680 understand and align on those few people metrics uh that 343 00:17:51,680 - > 00:17:52,799 really move the dial. 344 00:17:52,880 - > 00:17:55,599 Retention would be one, succession would be another, 345 00:17:55,839 - > 00:17:57,599 culture and climate would be another. 346 00:17:57,759 - > 00:18:03,039 So that P are looking at a broad set of um KPIs that perhaps they 347 00:18:03,039 - > 00:18:04,559 wouldn't necessarily orientate to. 348 00:18:04,640 - > 00:18:06,799 And it is a bit of a journey to get them on that. 349 00:18:06,880 - > 00:18:09,599 And they'll often say, Oh, can you go through the people bit a 350 00:18:09,599 - > 00:18:10,240 bit quicker? 351 00:18:10,319 - > 00:18:14,799 or but intrinsically you've got to remember these are this is 352 00:18:14,799 - > 00:18:15,920 where your value sits. 353 00:18:16,000 - > 00:18:18,640 It sits in those um individuals. 354 00:18:18,880 - > 00:18:22,079 So I look, I think, and and pre-deal, and I was actually 355 00:18:22,079 - > 00:18:24,319 having a conversation with a founder who's about to get P 356 00:18:24,640 - > 00:18:27,279 backed last week, and I said, you know, it's really 357 00:18:27,279 - > 00:18:30,079 encouraging that actually the private equity house was saying, 358 00:18:30,240 - > 00:18:33,039 tell me about your current culture, what are people really 359 00:18:33,039 - > 00:18:33,599 valuing? 360 00:18:33,759 - > 00:18:36,960 It people are starting to recognise that, yeah, in those 361 00:18:36,960 - > 00:18:40,400 businesses, we do need to ask the same questions we've always 362 00:18:40,400 - > 00:18:44,799 asked about EBDA revenue, but we also need to ask about what our 363 00:18:44,799 - > 00:18:48,079 most valuable asset that we're buying is thinking, feeling, 364 00:18:48,240 - > 00:18:50,720 doing, and wants to, you know, achieve. 365 00:18:50,880 - > 00:18:54,559 So look, I think it's happening, and I think P is also switching 366 00:18:54,559 - > 00:18:57,680 on to the fact that they need to need to play a broader role in 367 00:18:57,680 - > 00:18:58,160 hiring. 368 00:18:58,319 - > 00:19:03,279 So, like in one of my um roles last year, you know, P came on 369 00:19:03,279 - > 00:19:06,160 to an interview process for like a senior role. 370 00:19:06,240 - > 00:19:09,759 So they were taking more interest in who is the people 371 00:19:09,759 - > 00:19:10,480 coming in the door. 372 00:19:10,559 - > 00:19:13,599 Because we both know, like you get a hire wrong, particularly a 373 00:19:13,599 - > 00:19:17,039 senior hire in your boutique, it actually has quite a 374 00:19:17,039 - > 00:19:21,839 catastrophic effect on culture, on profit, on you know, you name 375 00:19:21,839 - > 00:19:22,000 it. 376 00:19:22,160 - > 00:19:25,359 So I think they're starting to recognise those hires really 377 00:19:25,359 - > 00:19:28,640 matter and if they can help and be part of that decision 378 00:19:28,640 - > 00:19:29,119 process. 379 00:19:29,279 - > 00:19:32,400 Because classically, PE would just say, right, at a certain 380 00:19:32,400 - > 00:19:35,359 clip level, we need to approve the hiring, but that would 381 00:19:35,359 - > 00:19:36,720 become a binary yes-no. 382 00:19:36,880 - > 00:19:39,759 Whereas now I see them more coming as part of that decision 383 00:19:39,839 - > 00:19:43,279 making and part of meeting the individual and sussing them out. 384 00:19:43,440 - > 00:19:47,759 So, look, I think encouraging all of that behaviour that makes 385 00:19:47,759 - > 00:19:52,720 them much more into that people um conversation is the right one 386 00:19:52,720 - > 00:19:52,960 for me. 387 00:19:53,039 - > 00:19:56,480 And and not being afraid for anyone who's chairing or being 388 00:19:56,480 - > 00:20:00,240 on a board out there, um, put the people piece on the agenda, 389 00:20:00,480 - > 00:20:04,319 have your HR director ideally come and stand that up or even 390 00:20:04,319 - > 00:20:05,279 be part of the board. 391 00:20:05,440 - > 00:20:08,799 Because also I think it's part of saying as well, who do we 392 00:20:08,799 - > 00:20:10,240 really need in our board setting? 393 00:20:10,319 - > 00:20:13,440 Because classically P was like CFO, CEO. 394 00:20:13,680 - > 00:20:14,160 Joe: Yes, yes. 395 00:20:14,319 - > 00:20:15,200 SPEAKER_00: That was the mode. 396 00:20:15,359 - > 00:20:19,039 Whereas now, you know, I've seen more openness to let's put the 397 00:20:19,039 - > 00:20:22,480 HRD on the board, let's maybe put the POOO or the client 398 00:20:22,480 - > 00:20:24,880 director so we get some direct client feedback. 399 00:20:25,039 - > 00:20:27,920 That is all changing, and I think we can play a role in 400 00:20:27,920 - > 00:20:28,880 helping change. 401 00:20:29,119 - > 00:20:29,920 Joe: Yeah, that's great. 402 00:20:30,000 - > 00:20:30,480 That's great. 403 00:20:30,559 - > 00:20:31,279 It's really good advice. 404 00:20:31,359 - > 00:20:35,440 And I thought I I would, you know, push anyone, anyone who is 405 00:20:35,440 - > 00:20:37,759 listening to this, who is thinking about scaling, whether 406 00:20:37,759 - > 00:20:42,000 you've got P or not, to you know, to really think about the 407 00:20:42,000 - > 00:20:45,680 people side of things and having as a standing board um item on 408 00:20:45,680 - > 00:20:46,960 the on the agenda. 409 00:20:47,200 - > 00:20:50,880 Um yeah, really, really interesting. 410 00:20:51,039 - > 00:20:56,319 And and just as an aside, uh I've so I've recently been going 411 00:20:56,319 - > 00:21:00,480 through my interventions over the last 20 odd years with with 412 00:21:00,480 - > 00:21:05,039 boards and trying to get some type of standardized methodology 413 00:21:05,039 - > 00:21:07,519 that I could show to other people and say, look, if you're 414 00:21:07,519 - > 00:21:10,160 going to be a board advisor or if you're going to be trying to 415 00:21:10,160 - > 00:21:14,960 increase eBit DAR, these are the uh you know 50 steps that you 416 00:21:14,960 - > 00:21:18,720 should do if you're if you're new to uh and I found it uh 417 00:21:18,720 - > 00:21:24,640 quite hard um because uh obviously uh there's a lot of 418 00:21:24,640 - > 00:21:26,960 flexibility with different types of firms. 419 00:21:27,039 - > 00:21:31,440 So I guess my question to you would be how much of your 420 00:21:31,599 - > 00:21:33,279 intervention is playbook? 421 00:21:33,599 - > 00:21:37,759 You know, here you know, you know 20 things I I do every 422 00:21:37,759 - > 00:21:44,000 time, and how much of it is dependent on the firm and the 423 00:21:44,559 - > 00:21:47,680 the people involved, I guess. 424 00:21:48,400 - > 00:21:49,119 SPEAKER_00: Yeah, Joe. 425 00:21:49,200 - > 00:21:51,680 So I I see it as the 80 20 rule. 426 00:21:51,759 - > 00:21:54,400 So only 20% I would say is standard. 427 00:21:54,480 - > 00:21:58,160 The w the way I think about it is the the 20% standard is the 428 00:21:58,160 - > 00:21:59,759 things you know you're always going to need. 429 00:22:00,160 - > 00:22:01,839 Do you're always going to need a board pack? 430 00:22:01,920 - > 00:22:04,559 You're always going to need to monitor these KPIs. 431 00:22:04,720 - > 00:22:07,119 You're always going to need a value creation plan and a 432 00:22:07,119 - > 00:22:08,480 hundred-day plan. 433 00:22:08,720 - > 00:22:13,759 And all of that is routine, mechanistic, you know, your 20%. 434 00:22:14,240 - > 00:22:18,319 The 80% actually can look different per firm. 435 00:22:18,400 - > 00:22:22,720 You might be working on similar value creation type activities, 436 00:22:22,880 - > 00:22:26,880 but that element is very much tailored to that particular 437 00:22:26,880 - > 00:22:27,279 business. 438 00:22:27,440 - > 00:22:30,640 Look, I think I think we're if we're good consultants, we're 439 00:22:30,640 - > 00:22:33,920 not imposing this straight jacketed approach and saying, 440 00:22:34,000 - > 00:22:36,559 you know, it's follow A, B, C, D. 441 00:22:36,880 - > 00:22:41,680 But yes, there's a 20% that, you know, you you roll out, and that 442 00:22:41,759 - > 00:22:43,519 that is standard stuff. 443 00:22:43,680 - > 00:22:47,519 Um, but no, the rest, I think, is really, you know, what is the 444 00:22:47,519 - > 00:22:49,359 journey this business is is on. 445 00:22:49,440 - > 00:22:52,480 I mean, one business I worked on, it was all about our 446 00:22:52,480 - > 00:22:54,480 international expansion to the US. 447 00:22:54,640 - > 00:22:58,799 Um, the last business that I exited was no international 448 00:22:58,799 - > 00:23:00,319 expansion in that business at all. 449 00:23:00,480 - > 00:23:03,279 We were all about organic growth, building out our 450 00:23:03,279 - > 00:23:06,480 accounts, building out our service lines, doubling down on 451 00:23:06,480 - > 00:23:07,759 a few sectors. 452 00:23:08,000 - > 00:23:11,839 It's different depending on the journey that that particular 453 00:23:11,839 - > 00:23:12,799 business is on. 454 00:23:12,960 - > 00:23:17,119 And, you know, I'm yeah, I would lean away from it as to be this 455 00:23:17,119 - > 00:23:17,519 thing. 456 00:23:17,680 - > 00:23:20,960 But I think having like sounds like what you're creating, which 457 00:23:20,960 - > 00:23:23,440 is, you know, think about all these dimensions of your 458 00:23:23,440 - > 00:23:23,599 business. 459 00:23:24,160 - > 00:23:27,920 It's very useful to have, to go as a list and go, right, which 460 00:23:27,920 - > 00:23:28,799 one should we pick up? 461 00:23:28,880 - > 00:23:31,680 My my other big thing is don't try and do too many things to 462 00:23:31,680 - > 00:23:32,799 any founder at once. 463 00:23:32,880 - > 00:23:36,720 You know, pick three, four things that you're working on at 464 00:23:36,720 - > 00:23:38,640 any one time and do those really well. 465 00:23:38,880 - > 00:23:42,000 Where value creation tends to go bad is when they say, right, 466 00:23:42,079 - > 00:23:46,160 there's there's 25 things on our list uh and we're working on all 467 00:23:46,160 - > 00:23:49,440 of them, which tends to mean somebody's kind of got it on 468 00:23:49,440 - > 00:23:52,079 their radar, maybe doing something about it. 469 00:23:52,480 - > 00:23:55,039 Joe: I wish I'd heard that advice 20 years ago when I 470 00:23:55,039 - > 00:23:58,640 started doing a board advisory work because my my approach used 471 00:23:58,640 - > 00:24:01,359 to be here is the long list of things you need to do. 472 00:24:01,599 - > 00:24:05,440 And of course, you know, you end up doing everything badly um and 473 00:24:05,440 - > 00:24:08,079 and losing momentum and faith and all the rest of it. 474 00:24:08,240 - > 00:24:10,559 Fortunately, I've learned that lesson, lesson now. 475 00:24:10,960 - > 00:24:17,279 Um, Karen, I was I was reading uh your CV and you know some of 476 00:24:17,279 - > 00:24:20,559 the other podcasts that you've done, and you you've had a lot 477 00:24:20,559 - > 00:24:24,240 of success in something that is going to be very close to most 478 00:24:24,240 - > 00:24:27,039 founders' hearts, and that's margin and sales. 479 00:24:27,359 - > 00:24:27,759 SPEAKER_00: Yeah. 480 00:24:28,000 - > 00:24:35,839 Joe: Um how do you go about improving those very, very 481 00:24:35,839 - > 00:24:40,799 important metrics in the kind of boutique consulting firms that 482 00:24:40,799 - > 00:24:43,119 perhaps the listeners might be a part of? 483 00:24:43,519 - > 00:24:47,039 SPEAKER_00: Yeah, look, I think if we take um sales Joe first, 484 00:24:47,119 - > 00:24:50,960 perhaps so uh you're classically as a founder the person who's 485 00:24:50,960 - > 00:24:53,759 doing most of the sales, and you do it very well, and naturally 486 00:24:53,839 - > 00:24:57,039 you were orientated doing this work because you were fab at 487 00:24:57,039 - > 00:24:58,079 business development. 488 00:24:58,319 - > 00:25:01,599 It cannot all reside in the founder as you scale up. 489 00:25:01,759 - > 00:25:06,720 So you're looking for hires who have that potential to sell on a 490 00:25:06,720 - > 00:25:07,759 similar scale to you. 491 00:25:07,920 - > 00:25:10,480 They may also be your successor, it may not. 492 00:25:10,640 - > 00:25:14,640 So that that is one that sales does not all kind of come 493 00:25:14,640 - > 00:25:16,319 together just in the founder. 494 00:25:16,480 - > 00:25:20,640 Who can you bring across that so that everyone uh plays a role? 495 00:25:20,880 - > 00:25:24,480 The second thing in consultancy, and this was very much IBM 496 00:25:24,480 - > 00:25:27,039 training, was everyone is in sales. 497 00:25:27,200 - > 00:25:32,160 So even if you're a person down in the delivery of the business, 498 00:25:32,400 - > 00:25:34,160 can you spot those opportunities? 499 00:25:34,400 - > 00:25:38,160 Can you ask those questions in whatever you're delivering that 500 00:25:38,160 - > 00:25:39,759 opens the door for other things? 501 00:25:39,920 - > 00:25:42,240 Doesn't mean you're the person then that has to take that 502 00:25:42,240 - > 00:25:42,720 forward. 503 00:25:42,799 - > 00:25:46,319 So I think that mantra of everyone is in sales, everyone 504 00:25:46,319 - > 00:25:48,640 can spot opportunities is another one. 505 00:25:48,720 - > 00:25:51,920 And obviously, as we talked about, broaden your sales. 506 00:25:52,160 - > 00:25:55,279 The second thing you're probably thinking about is your service 507 00:25:55,279 - > 00:25:57,839 line and sector growth plan. 508 00:25:58,240 - > 00:26:02,559 So most businesses start singular sector, perhaps in in 509 00:26:02,559 - > 00:26:03,759 one domain. 510 00:26:04,000 - > 00:26:05,920 What are those natural extensions? 511 00:26:06,000 - > 00:26:09,680 So if you started in FS, you know, do you have a natural play 512 00:26:09,680 - > 00:26:10,319 in insurance? 513 00:26:10,400 - > 00:26:14,000 Is that an adjacent sector that you can go and talk about FS and 514 00:26:14,000 - > 00:26:16,799 it'll still be relevant and credible in that? 515 00:26:16,960 - > 00:26:21,200 So the second is you're thinking about how do you um kind of 516 00:26:21,200 - > 00:26:24,640 improve and move beyond your current sectors. 517 00:26:24,799 - > 00:26:28,559 And the same with service lines, you might start deep in, I don't 518 00:26:28,559 - > 00:26:32,480 know, CRM, um, but then you might branch out into marketing 519 00:26:32,480 - > 00:26:33,519 transformation and others. 520 00:26:33,599 - > 00:26:36,720 So you look for those uh adjacent lines as well. 521 00:26:37,200 - > 00:26:41,039 Joe: And just on that, Karen, do you like to see triggers for 522 00:26:41,039 - > 00:26:41,920 expansion? 523 00:26:42,160 - > 00:26:45,519 So so a couple of firms I've spoken to have been who've done 524 00:26:45,519 - > 00:26:50,480 this very successfully, for example, won't um shift to 525 00:26:50,480 - > 00:26:54,000 another service line until they've hit eBitDAR of a certain 526 00:26:54,000 - > 00:26:57,359 amount and or at least gross margin and a certain growth 527 00:26:57,359 - > 00:26:57,759 rate. 528 00:26:57,920 - > 00:26:59,920 And then they'll then they'll shift. 529 00:27:00,160 - > 00:27:03,359 Do you do you look for those triggers or is it more of a gut 530 00:27:03,359 - > 00:27:03,920 feel? 531 00:27:04,319 - > 00:27:05,839 SPEAKER_00: Yeah, look, I think so, Joe. 532 00:27:05,920 - > 00:27:08,319 I think you do look for triggers, but those triggers 533 00:27:08,319 - > 00:27:09,440 might be market driven. 534 00:27:09,519 - > 00:27:11,279 So it might be interest from another. 535 00:27:12,079 - > 00:27:16,000 It doesn't necessarily have to be we need 10 million revenue 536 00:27:16,000 - > 00:27:18,480 and a million of EB dying financial services before we 537 00:27:18,480 - > 00:27:19,200 move to insurance. 538 00:27:19,359 - > 00:27:22,720 I think often you get market triggers and signals that might 539 00:27:22,720 - > 00:27:23,519 take you there. 540 00:27:23,680 - > 00:27:27,279 It might be, you know, an inbound inquiry, it might be 541 00:27:27,279 - > 00:27:30,640 that you just made your next grade hire and they add a you 542 00:27:30,640 - > 00:27:31,920 know capability in that. 543 00:27:32,000 - > 00:27:33,599 So I think triggers, yes. 544 00:27:33,759 - > 00:27:36,400 Um I think a lot of founders do have good instincts. 545 00:27:36,480 - > 00:27:39,359 So I wouldn't want to say this is purely like binary. 546 00:27:39,440 - > 00:27:42,960 They often have good instincts around where they would um play 547 00:27:43,039 - > 00:27:43,599 as well. 548 00:27:43,839 - > 00:27:46,640 The other piece to think about is your account management 549 00:27:46,640 - > 00:27:46,960 model. 550 00:27:47,200 - > 00:27:50,799 So early stage businesses have a deal mentality typically. 551 00:27:50,960 - > 00:27:54,240 They win a deal, they deliver that to the best possible way, 552 00:27:54,319 - > 00:27:57,920 they go on and that deal mentality can carry you so far. 553 00:27:58,160 - > 00:28:00,880 Um, but it's the account management model that gets you 554 00:28:00,880 - > 00:28:01,759 into that scale. 555 00:28:01,920 - > 00:28:06,000 So let's say you sold a piece of work at Barclays, how do you 556 00:28:06,000 - > 00:28:09,519 take that one deal at Barclays and really expand that so that 557 00:28:09,519 - > 00:28:12,960 you're doing a much bigger footprint in that organization? 558 00:28:13,200 - > 00:28:17,359 And again, a lot what a lot of um founders then do is think 559 00:28:17,359 - > 00:28:18,880 about account leadership. 560 00:28:19,039 - > 00:28:22,640 So, do I have someone who sits at an account level and is 561 00:28:22,640 - > 00:28:25,200 responsible for the revenue and profit in that account and 562 00:28:25,200 - > 00:28:26,240 everything that that happens? 563 00:28:26,480 - > 00:28:29,759 It tends to be under a, you know, a sort of growth office. 564 00:28:29,920 - > 00:28:32,799 Um we talked about pricing discipline, so you know, won't 565 00:28:32,880 - > 00:28:33,920 go over that too much. 566 00:28:34,000 - > 00:28:37,200 But I think that journey, as we talked about from day rate 567 00:28:37,279 - > 00:28:41,920 pricing, time and materials to outcome-based is another journey 568 00:28:41,920 - > 00:28:45,279 um to go on, which would often lead to you know good margin 569 00:28:45,279 - > 00:28:46,000 improvement. 570 00:28:46,240 - > 00:28:48,960 We also perhaps need to talk about the operation efficiency 571 00:28:48,960 - > 00:28:49,680 of the business. 572 00:28:49,920 - > 00:28:54,000 So um again, what I find in these smaller businesses very 573 00:28:54,000 - > 00:28:58,319 normally is um either they've got tools that they're not using 574 00:28:58,319 - > 00:29:02,880 well, often the sales tools, or they haven't got standardized 575 00:29:02,880 - > 00:29:03,680 processes yet. 576 00:29:03,759 - > 00:29:06,960 So everything is, you know, is not as efficient as perhaps it 577 00:29:06,960 - > 00:29:07,599 could be. 578 00:29:07,759 - > 00:29:11,359 Um, the other challenge we have is whenever we hire someone in a 579 00:29:11,359 - > 00:29:15,279 back office role, one consultant can sometimes have a bit of 580 00:29:15,279 - > 00:29:16,240 tissue rejection. 581 00:29:16,319 - > 00:29:18,799 That's not a billable uh role. 582 00:29:18,880 - > 00:29:20,240 So, how do we think about that? 583 00:29:20,319 - > 00:29:22,319 And it's important to get the right ones, but it's important 584 00:29:22,319 - > 00:29:26,319 also not to build out such a big back office that you've got this 585 00:29:26,319 - > 00:29:29,119 cost space that you've got to maintain too early. 586 00:29:29,279 - > 00:29:32,160 And there are certain roles you absolutely need, but it's a 587 00:29:32,160 - > 00:29:33,440 journey to build those out. 588 00:29:33,599 - > 00:29:36,160 The downside is, of course, when you hire someone senior, they 589 00:29:36,160 - > 00:29:37,279 want to build a team. 590 00:29:37,440 - > 00:29:39,920 Um natural instinct, we all would do that. 591 00:29:40,079 - > 00:29:42,559 So it's that's just one piece to watch as well. 592 00:29:42,720 - > 00:29:44,799 But you're you've got the right roles in your back office, 593 00:29:44,880 - > 00:29:47,920 you've got streamlined processes, you're using the 594 00:29:47,920 - > 00:29:50,400 systems that you put in place, or you're replacing them for 595 00:29:50,400 - > 00:29:53,119 something better that would enable you to scale. 596 00:29:53,279 - > 00:29:56,319 But keeping that lean and cost efficient is bringing that P 597 00:29:56,640 - > 00:29:57,359 disciplinary. 598 00:29:57,759 - > 00:30:00,480 Joe: Yes, yeah, I'm I'm laughing because so much of this applies 599 00:30:00,480 - > 00:30:01,119 to me. 600 00:30:04,240 - > 00:30:08,079 I love a tool, I love a tool, and um, and um unfortunately I 601 00:30:08,079 - > 00:30:11,119 often pay for it in in a way that is uh almost makes it 602 00:30:11,119 - > 00:30:12,240 invisible the cost. 603 00:30:12,319 - > 00:30:16,720 And um, yes, I've recently decided that the I I've recently 604 00:30:16,720 - > 00:30:21,759 discovered the nine 99% of HubSpot's uh functionality I'm 605 00:30:21,759 - > 00:30:22,319 not using. 606 00:30:22,559 - > 00:30:26,640 And so um yeah, and they're not they're not inexpensive, you 607 00:30:26,640 - > 00:30:28,880 know, they're they're they some of these tools can be quite 608 00:30:28,880 - > 00:30:31,279 expensive, especially once you add all the seats on. 609 00:30:31,519 - > 00:30:33,200 SPEAKER_00: Yeah, yeah, no, absolutely. 610 00:30:33,279 - > 00:30:36,240 So yeah, just get disciplined around your back office, but I'm 611 00:30:36,240 - > 00:30:38,319 not advocating not to hire those roles. 612 00:30:38,480 - > 00:30:41,839 The time I've had conversations about should I hire a people 613 00:30:41,839 - > 00:30:42,160 lead? 614 00:30:42,240 - > 00:30:45,759 Yes, in a people-centric business, you need a people lead 615 00:30:45,839 - > 00:30:47,680 uh to support you on that journey. 616 00:30:47,920 - > 00:30:50,240 You also need someone who's gonna own finance, and if you 617 00:30:50,240 - > 00:30:53,200 want to move PE back, that role comes under a lot of pressure. 618 00:30:53,279 - > 00:30:56,880 So make sure you've got that finance lead who's bringing that 619 00:30:56,880 - > 00:31:00,079 discipline um to the business who'll be credible with PE and 620 00:31:00,079 - > 00:31:02,960 who can drive that, you know, big, big important role. 621 00:31:03,119 - > 00:31:05,920 So certain roles don't compromise at all. 622 00:31:06,319 - > 00:31:07,119 Joe: Yes, yes. 623 00:31:07,200 - > 00:31:10,640 But I'm guessing I'm guessing that's of a certain size. 624 00:31:10,799 - > 00:31:16,720 So um I'm I'm guessing that with the HR and the serious CFO, as 625 00:31:16,720 - > 00:31:19,359 opposed to somebody that is accounting qualified and call 626 00:31:19,440 - > 00:31:20,960 themselves a CFO. 627 00:31:21,119 - > 00:31:24,559 I'm guessing that post-transaction the CFO is is 628 00:31:24,559 - > 00:31:26,319 obviously more more important. 629 00:31:26,880 - > 00:31:33,599 Um what when do you like to see uh uh a CHRO involved? 630 00:31:33,759 - > 00:31:37,519 Is is that a typical size or a typical maturity that you get to 631 00:31:37,599 - > 00:31:40,559 and you think, right, now's the time, or do you like to see that 632 00:31:40,559 - > 00:31:45,279 role evolve over from start-up to growth to scale? 633 00:31:45,599 - > 00:31:47,839 SPEAKER_00: Yeah, I've seen both actually work. 634 00:31:48,000 - > 00:31:51,599 I've seen it where they will have an HR person in post, but 635 00:31:51,599 - > 00:31:54,400 it certainly won't be, you know, a chief human resource officer. 636 00:31:54,559 - > 00:31:57,680 But it would they'll they'll grow the role with the maturity 637 00:31:57,680 - > 00:31:58,400 of the business. 638 00:31:58,559 - > 00:32:00,240 Or I've seen that hire that role. 639 00:32:00,400 - > 00:32:04,400 So, in like the last business, take that one as an example. 640 00:32:04,640 - > 00:32:08,240 We hired a people director post-investment. 641 00:32:08,400 - > 00:32:13,200 So we'd got P investment to our first P run, and we hired that 642 00:32:13,200 - > 00:32:16,319 role about eight months in, having been through a serious 643 00:32:16,319 - > 00:32:20,400 process to get that, and we recognized that um what we'd be 644 00:32:20,400 - > 00:32:24,480 at about 60 people at that point, so still relatively um 645 00:32:24,640 - > 00:32:29,599 small, but we recognized that that was an area that we really 646 00:32:29,599 - > 00:32:30,480 needed to dial up. 647 00:32:30,640 - > 00:32:34,480 We were hiring very specialist skills, um, we needed to make 648 00:32:34,480 - > 00:32:38,400 sure we'd got succession plans in place, we needed to make sure 649 00:32:38,400 - > 00:32:42,960 we were retaining people in what was a very hot data analytics 650 00:32:43,200 - > 00:32:44,559 kind of market space. 651 00:32:44,720 - > 00:32:46,240 So, look, I think it can be both. 652 00:32:46,400 - > 00:32:50,160 I think you can either evolve that role as as you scale, and 653 00:32:50,160 - > 00:32:53,599 naturally there are things to look out for of when to buy that 654 00:32:53,599 - > 00:32:53,839 role. 655 00:32:54,000 - > 00:32:57,440 Or if you haven't had any people based in the role, or maybe 656 00:32:57,440 - > 00:33:00,799 you've relied on a uh, you know, an independent firm who's maybe 657 00:33:00,799 - > 00:33:04,319 providing you with a bit of advice here and there, I think 658 00:33:04,319 - > 00:33:08,240 seriously look at it once once you've got investment is 659 00:33:08,240 - > 00:33:11,839 probably a good trigger because yeah, all your value sits in the 660 00:33:11,839 - > 00:33:12,079 people. 661 00:33:12,160 - > 00:33:14,319 Why wouldn't you have someone caretaking? 662 00:33:14,799 - > 00:33:16,960 It also depends on you as a founder. 663 00:33:17,039 - > 00:33:20,720 So I've known founders who are incredibly love that side of 664 00:33:20,720 - > 00:33:21,200 their job. 665 00:33:21,279 - > 00:33:23,920 They very much like all of the people side of things, but I've 666 00:33:23,920 - > 00:33:27,119 equally worked with founders who are fabulous out in the market, 667 00:33:27,279 - > 00:33:31,440 creating new work, and the idea of dealing with that element is 668 00:33:31,440 - > 00:33:32,880 just not in their DNA. 669 00:33:33,039 - > 00:33:36,480 So it's also a bit about you and what where you orientate to. 670 00:33:36,559 - > 00:33:40,000 If your orientation is, I love being out in the market, I love 671 00:33:40,000 - > 00:33:42,640 winning new work, then play to that strength. 672 00:33:42,720 - > 00:33:45,519 That's very important, and not a lot of people do love that. 673 00:33:45,680 - > 00:33:48,319 So let then someone else caretake some of those 674 00:33:48,319 - > 00:33:52,079 operational people issues that you won't naturally feel an 675 00:33:52,079 - > 00:33:53,279 orientation to. 676 00:33:53,680 - > 00:33:54,319 Joe: Yes, yes. 677 00:33:54,400 - > 00:33:56,640 I think I think that's great, a great insight. 678 00:33:56,720 - > 00:34:00,559 And and of course, you get to a stage as a as a people firm 679 00:34:00,799 - > 00:34:04,559 where it's not just attention to people that's important, it's 680 00:34:04,559 - > 00:34:07,680 the competence frameworks, it's the training structure of the 681 00:34:07,680 - > 00:34:11,599 academy, and and and that's obviously if you're getting on 682 00:34:11,599 - > 00:34:15,360 an experience, you know, HR director, they're gonna have 683 00:34:15,360 - > 00:34:15,519 that. 684 00:34:15,760 - > 00:34:18,880 Hopefully, they'll have that in their back pocket, um, which 685 00:34:18,880 - > 00:34:21,920 will save time and and and all the rest of it. 686 00:34:22,159 - > 00:34:27,360 Um okay, so I I I as I said, I I did um I've done a fair bit of 687 00:34:27,360 - > 00:34:27,760 digging. 688 00:34:27,840 - > 00:34:29,519 Uh there's so much I could talk. 689 00:34:29,599 - > 00:34:32,480 Maybe it's another podcast, but yeah, there was something you 690 00:34:32,480 - > 00:34:37,280 said in, I think it was a a different podcast, which was you 691 00:34:37,280 - > 00:34:40,719 said transform first and integrate second. 692 00:34:41,280 - > 00:34:45,360 And I think that, and that's I think um uh advice 693 00:34:45,360 - > 00:34:46,559 post-transaction. 694 00:34:46,880 - > 00:34:50,639 So when when what do you mean by that? 695 00:34:50,800 - > 00:34:55,199 So it is that is that advice for the PE firms themselves, or is 696 00:34:55,199 - > 00:34:58,800 it advice for the the firm that's been bought? 697 00:34:59,519 - > 00:35:01,039 SPEAKER_00: Yeah, it's a bit of both, Joe. 698 00:35:01,119 - > 00:35:05,599 Look, I think I've been I've done 51 now MA deals, right? 699 00:35:05,840 - > 00:35:09,199 And I think Yeah, 51st was last year. 700 00:35:09,599 - > 00:35:12,719 I look, I think there's a couple of things that that go on. 701 00:35:12,960 - > 00:35:16,559 Firstly, MPE, there's obviously this speed and the clock that I 702 00:35:16,559 - > 00:35:17,440 that I talked about. 703 00:35:17,599 - > 00:35:22,400 So how fast can we now bring two assets together is often the 704 00:35:22,400 - > 00:35:23,199 question, right? 705 00:35:23,440 - > 00:35:27,840 And perhaps less is put on are those independently good 706 00:35:27,840 - > 00:35:29,440 businesses to bring together. 707 00:35:29,599 - > 00:35:32,079 Because if you bring a broken business into a, you know, 708 00:35:32,159 - > 00:35:34,079 you're gonna end up with a broken mess. 709 00:35:34,239 - > 00:35:37,920 So my approach to integration is saying are the things within 710 00:35:37,920 - > 00:35:41,280 each business we need to fix first before we start to 711 00:35:41,519 - > 00:35:43,519 naturally bring those those together. 712 00:35:43,679 - > 00:35:47,519 So if I take an integration I did last year, um, you know, the 713 00:35:47,519 - > 00:35:51,199 intent the intention was right, let's quickly now bring all of 714 00:35:51,199 - > 00:35:54,079 the business units together, let's put the back office 715 00:35:54,079 - > 00:35:58,239 functions together without thinking about, okay, but one's 716 00:35:58,239 - > 00:36:01,920 got a broken finance system and one's got an okay finance 717 00:36:01,920 - > 00:36:05,440 system, but not currently big enough for the combined entity. 718 00:36:05,679 - > 00:36:08,000 So perhaps what we need to do is think about what are the 719 00:36:08,000 - > 00:36:09,119 processes that we want. 720 00:36:09,280 - > 00:36:13,039 So it's that mindset of thinking what do we need to transform or 721 00:36:13,280 - > 00:36:17,360 transform or put in place first before we suddenly rush to go, 722 00:36:17,599 - > 00:36:20,880 let's just bolt two things together, and then it looks like 723 00:36:20,880 - > 00:36:23,199 we've uh integrated. 724 00:36:23,360 - > 00:36:25,440 And then the natural instinct, and of course, there's nothing 725 00:36:25,440 - > 00:36:27,920 wrong with this, it's the human nature of right, we've bought 726 00:36:27,920 - > 00:36:30,880 two things to crash together, let's just quickly bring them 727 00:36:30,880 - > 00:36:31,280 together. 728 00:36:31,360 - > 00:36:34,480 But it rarely works unless it's thought through as a 729 00:36:34,480 - > 00:36:35,119 transformation. 730 00:36:35,280 - > 00:36:38,400 It's genuinely good questions to ask is what bits do need to be 731 00:36:38,400 - > 00:36:42,320 integrated, what do we perhaps need to fix first on each 732 00:36:42,320 - > 00:36:46,320 business before you start to think about okay, let's let's 733 00:36:46,320 - > 00:36:48,800 bring these two assets to together. 734 00:36:48,880 - > 00:36:51,519 Because naturally, you know, there's processes to fix, 735 00:36:51,679 - > 00:36:54,960 there's procedures to fix, there's technology to fix, 736 00:36:55,119 - > 00:36:58,800 there's the cultural dynamic of how these are going to work 737 00:36:58,800 - > 00:36:59,119 together. 738 00:36:59,199 - > 00:37:01,440 So that's just my one take, Joe. 739 00:37:01,519 - > 00:37:04,960 Perhaps I learned over the years that yeah, don't be in such a 740 00:37:04,960 - > 00:37:08,800 hurry that it has to, because inevitably that probably leads 741 00:37:08,800 - > 00:37:10,480 you into a less good place. 742 00:37:10,880 - > 00:37:12,239 Joe: Yeah, great, great. 743 00:37:12,400 - > 00:37:17,119 And and when you do the the value planning, so when when 744 00:37:17,199 - > 00:37:20,400 when the when the company and and the boards do the value 745 00:37:20,400 - > 00:37:23,920 planning, how do you decide? 746 00:37:24,079 - > 00:37:29,199 Because that that long list that we talked about earlier, what I 747 00:37:29,199 - > 00:37:29,920 guess two things. 748 00:37:30,079 - > 00:37:32,320 One, what does it look like in practice? 749 00:37:32,559 - > 00:37:35,920 So obviously you'll have done the due diligence on the firm, 750 00:37:36,000 - > 00:37:39,519 so ideally the value plan will have been built, you know, quite 751 00:37:39,599 - > 00:37:40,880 quite early on. 752 00:37:41,199 - > 00:37:44,719 But how do how do you get to those priorities? 753 00:37:44,960 - > 00:37:48,320 So the the three or four things that you were really going to 754 00:37:48,320 - > 00:37:49,920 focus on that year. 755 00:37:50,639 - > 00:37:53,119 SPEAKER_00: I mean, you pitch, Joe, on like what I think is one 756 00:37:53,119 - > 00:37:54,400 of the main challenges, right? 757 00:37:54,480 - > 00:37:58,239 We we find it hard as humans to say what are the few things 758 00:37:58,239 - > 00:37:59,840 we're going to do really well, don't we? 759 00:37:59,920 - > 00:38:02,960 We we're tempted to say the list out all the things we want to 760 00:38:02,960 - > 00:38:03,119 do. 761 00:38:03,199 - > 00:38:03,840 I think you're right. 762 00:38:03,920 - > 00:38:07,440 Look, as a founder, if you've got through due diligence, um, 763 00:38:07,679 - > 00:38:10,400 and a number of areas will have been identified, you know, 764 00:38:10,559 - > 00:38:14,559 expand into ex-service line, get an account management model, 765 00:38:15,039 - > 00:38:18,320 invest in one or two more industries, maybe find one 766 00:38:18,320 - > 00:38:21,280 international footprint, whatever it might be. 767 00:38:21,440 - > 00:38:25,119 There's a process to go through to say, right, what what's the 768 00:38:25,119 - > 00:38:25,599 sequence? 769 00:38:25,760 - > 00:38:29,519 What's going to give us our best bang for our butt initially? 770 00:38:29,679 - > 00:38:32,320 And what do we maybe put further down the line? 771 00:38:32,400 - > 00:38:34,800 And what are the trigger points we would get to? 772 00:38:35,119 - > 00:38:36,159 You raised that already. 773 00:38:36,239 - > 00:38:39,119 What are the trigger points we might get to to decide whether 774 00:38:39,119 - > 00:38:42,880 to, you know, expand internationally or do buy 775 00:38:42,880 - > 00:38:44,000 another company? 776 00:38:44,159 - > 00:38:45,360 So I think it's that. 777 00:38:45,440 - > 00:38:50,480 I think it's saying what's easy to do and we can do now, and is 778 00:38:50,639 - > 00:38:52,639 very adjacent to where we start. 779 00:38:52,800 - > 00:38:56,880 Because remember, PE also brings this risk mentality there where 780 00:38:56,880 - > 00:38:59,440 they don't want to see a thousand things, they just want 781 00:38:59,440 - > 00:39:02,719 to have what's the two or three things we're going to do first. 782 00:39:02,960 - > 00:39:06,000 Get them under our belt, do them really well, get them into a 783 00:39:06,000 - > 00:39:09,119 rhythm and cadence, and then look at the next one. 784 00:39:09,199 - > 00:39:12,800 So it's not about saying no to things, it's about saying what's 785 00:39:12,800 - > 00:39:14,800 the prioritization and sequence. 786 00:39:14,960 - > 00:39:18,960 And again, one skill to bring is that whole business case. 787 00:39:19,119 - > 00:39:22,400 So, again, in the past, founders, you probably were 788 00:39:22,559 - > 00:39:26,480 like, yeah, good idea to go and invest in Stockholm. 789 00:39:26,719 - > 00:39:27,519 We'll we'll do that. 790 00:39:27,599 - > 00:39:28,960 And again, it came down to you. 791 00:39:29,119 - > 00:39:32,320 There's a discipline of bringing a business case to a board and 792 00:39:32,320 - > 00:39:36,000 saying, look, we really believe there's an opportunity in the US 793 00:39:36,000 - > 00:39:37,920 here, and this is what we think it would take. 794 00:39:38,079 - > 00:39:40,320 Uh, this is our and and do you agree? 795 00:39:40,480 - > 00:39:44,239 And having that discipline of doing business cases whilst can 796 00:39:44,320 - > 00:39:46,960 feel tedious if you're needing to write them, is good 797 00:39:46,960 - > 00:39:49,840 discipline because it's forcing you to say, what is the return? 798 00:39:50,000 - > 00:39:51,039 When would we get it? 799 00:39:51,199 - > 00:39:53,119 That kind of discipline P likes. 800 00:39:53,199 - > 00:39:57,039 And and so it's structuring those in a way and not just 801 00:39:57,039 - > 00:39:58,880 making all your bets uh at once. 802 00:39:58,960 - > 00:40:01,119 You wouldn't have the capacity anyway to absorb it. 803 00:40:01,199 - > 00:40:02,880 That's the other challenge, right? 804 00:40:02,960 - > 00:40:05,840 You can have intent, but unless you've got the people who can 805 00:40:05,840 - > 00:40:07,599 then go and execute that. 806 00:40:07,760 - > 00:40:11,920 Um, so I would say and and start small, just pick two or three 807 00:40:11,920 - > 00:40:16,400 things at any one time um that you're really doubling down on, 808 00:40:16,480 - > 00:40:19,119 and the next can come in your next wave. 809 00:40:19,440 - > 00:40:21,280 Joe: Yeah, great, great, fantastic. 810 00:40:21,440 - > 00:40:24,800 Okay, there's some wonderful nuggets of advice will hit hit 811 00:40:24,880 - > 00:40:26,159 here, some real gold. 812 00:40:26,320 - > 00:40:28,639 Um, I I had two final questions. 813 00:40:28,719 - > 00:40:32,800 So one of them is if you were going to give one piece of 814 00:40:32,800 - > 00:40:39,280 advice to a founder and an owner that was going into a PE 815 00:40:39,280 - > 00:40:41,840 transaction, what would that advice be? 816 00:40:42,000 - > 00:40:44,639 I realise it's going to depend on bits and pieces, but if you 817 00:40:44,639 - > 00:40:47,039 had a hundred of them in a room and you said, look, one thing to 818 00:40:47,039 - > 00:40:50,880 take away from today's talk is what would it be? 819 00:40:51,679 - > 00:40:55,440 SPEAKER_00: I'd say, Joe, build the discipline before PE comes, 820 00:40:55,679 - > 00:40:59,199 and then it won't feel as stark a contrast. 821 00:40:59,360 - > 00:41:01,679 And I would say this: look, if you're a founder out there and 822 00:41:01,679 - > 00:41:04,559 actually you just say, I don't want P investment BT, I don't 823 00:41:04,559 - > 00:41:07,119 want to take it, fine, but try and bring some of that 824 00:41:07,119 - > 00:41:09,599 discipline into the business that you start anyway. 825 00:41:09,679 - > 00:41:14,079 You don't need PE to have a good board pack, track the right 826 00:41:14,079 - > 00:41:18,000 metrics, have good decision making, bring an independent 827 00:41:18,000 - > 00:41:20,960 advisor on board, even forget getting PE. 828 00:41:21,199 - > 00:41:24,000 Uh, you can do this on your own, you can scale this business 829 00:41:24,000 - > 00:41:24,559 without it. 830 00:41:24,719 - > 00:41:27,840 Just bring some of the great discipline that PE would bring. 831 00:41:27,920 - > 00:41:32,719 So I I would say pre even going there, bring that discipline in 832 00:41:32,719 - > 00:41:35,599 place already, because then you're already operating in that 833 00:41:35,599 - > 00:41:38,000 mindset and you may or may not need the cash. 834 00:41:38,400 - > 00:41:41,199 Um so that that would be my biggest one because that's 835 00:41:41,199 - > 00:41:41,519 great. 836 00:41:41,760 - > 00:41:45,840 Yeah, you're not, you're not uh you're not about to come into 837 00:41:45,840 - > 00:41:48,000 what feels like quite a big transition. 838 00:41:48,320 - > 00:41:49,840 Joe: Yeah, it's it's so interesting. 839 00:41:49,920 - > 00:41:54,320 So I I uh so I primarily deal with you know sell side or you 840 00:41:54,320 - > 00:41:56,719 know, prior a few years prior to the sale. 841 00:41:56,880 - > 00:42:00,400 And and sometimes founders will say, you know, I'll be chatting 842 00:42:00,400 - > 00:42:02,719 to them about their future plans, they'll say, Well, you 843 00:42:02,719 - > 00:42:05,039 know, we don't really want to sell, you know, it's not on our 844 00:42:05,039 - > 00:42:05,679 radar. 845 00:42:05,920 - > 00:42:10,400 And I always respond, well, regardless, a good company is 846 00:42:10,400 - > 00:42:14,880 one that has these systems, you know, PE and buyers, strategic 847 00:42:14,880 - > 00:42:18,719 buyers, want to want uh a good business. 848 00:42:18,960 - > 00:42:20,960 And so this is what a good business looks like. 849 00:42:21,119 - > 00:42:23,679 So if you want to scale by yourself, it's what you should 850 00:42:23,679 - > 00:42:24,320 be aiming for. 851 00:42:24,719 - > 00:42:25,840 SPEAKER_00: Yeah, exactly. 852 00:42:26,639 - > 00:42:31,199 Joe: The final thing I just a slight said segue um is your 853 00:42:31,199 - > 00:42:32,639 LinkedIn presence. 854 00:42:32,800 - > 00:42:34,880 So you're very, very visible. 855 00:42:35,599 - > 00:42:40,400 Um, and it's something that I really urge consultancy leaders 856 00:42:40,400 - > 00:42:44,480 and boutique leaders to to do, and there's lots of evidence 857 00:42:44,480 - > 00:42:47,840 that it works, but there's still either a lot of resistance or a 858 00:42:47,840 - > 00:42:50,079 lot of bad examples of it happening. 859 00:42:50,400 - > 00:42:56,079 I think you've built up a great uh visible presence that really 860 00:42:56,079 - > 00:43:00,480 demonstrates your expertise, both on LinkedIn and elsewhere. 861 00:43:00,880 - > 00:43:05,920 Um, what advice would you give you know, partners, directors, 862 00:43:06,159 - > 00:43:11,760 founders that wanted to develop a serious, visible presence of 863 00:43:11,760 - > 00:43:13,599 the type that you've built up? 864 00:43:14,079 - > 00:43:16,960 SPEAKER_00: Yeah, look, I think again, Joe, I uh my advice is 865 00:43:16,960 - > 00:43:18,639 probably again start small. 866 00:43:18,719 - > 00:43:22,079 So I would find a topic that you're really passionate about 867 00:43:22,239 - > 00:43:24,719 and that you're well placed to uniquely own. 868 00:43:24,960 - > 00:43:25,039 Right. 869 00:43:25,599 - > 00:43:28,320 Whatever that is, double down on that. 870 00:43:28,400 - > 00:43:31,440 Don't don't the worst advice is when you try and be everything 871 00:43:31,440 - > 00:43:32,480 to everyone, right? 872 00:43:32,639 - > 00:43:34,320 Your audience can be very small. 873 00:43:34,400 - > 00:43:37,280 If they're your buyers and there's only 10 of them, go for 874 00:43:37,280 - > 00:43:37,840 them, right? 875 00:43:38,000 - > 00:43:41,199 And I would write in the style that you're almost writing for 876 00:43:41,199 - > 00:43:42,159 that one person. 877 00:43:42,400 - > 00:43:47,199 So if you're selling to financial services, um, write 878 00:43:47,199 - > 00:43:50,079 for a financial services director in a firm that you 879 00:43:50,079 - > 00:43:51,760 would have as your ideal customer. 880 00:43:51,920 - > 00:43:54,800 Imagine that person and imagine you're writing for them. 881 00:43:54,960 - > 00:43:59,280 And talk about what the problem was, how you solved it, what the 882 00:43:59,280 - > 00:43:59,760 outcome was. 883 00:44:00,079 - > 00:44:03,760 Was very tangible impact, which consultants can often not do. 884 00:44:04,079 - > 00:44:06,079 Talk about the difference that you made. 885 00:44:06,320 - > 00:44:10,800 And don't worry if, in the first post that you write, only your 886 00:44:10,800 - > 00:44:13,199 mum and you know your best friend write it. 887 00:44:13,599 - > 00:44:14,480 Please don't worry. 888 00:44:14,880 - > 00:44:16,239 Joe: It takes a while, doesn't it? 889 00:44:16,400 - > 00:44:16,800 SPEAKER_00: It does. 890 00:44:16,880 - > 00:44:17,440 It takes a while. 891 00:44:17,519 - > 00:44:19,039 And you know the good thing about that, Joe? 892 00:44:19,199 - > 00:44:21,840 In the beginning, you're not that good at writing like I 893 00:44:21,840 - > 00:44:22,239 wasn't. 894 00:44:22,320 - > 00:44:25,039 And so I didn't need much of an audience because what I was 895 00:44:25,039 - > 00:44:27,119 using it for was to get better at it. 896 00:44:27,440 - > 00:44:30,000 And your audience grows with how good you get at it. 897 00:44:30,159 - > 00:44:32,559 So that is absolutely fine. 898 00:44:32,639 - > 00:44:36,159 And I would say don't shy away from it because you can get a 899 00:44:36,159 - > 00:44:40,480 lot of leads through writing crisp, articulate posts. 900 00:44:40,800 - > 00:44:44,400 So it is a lead generation channel that's out there. 901 00:44:44,480 - > 00:44:47,039 There's so many people on LinkedIn as if that's the one 902 00:44:47,679 - > 00:44:48,960 that you choose. 903 00:44:49,280 - > 00:44:52,000 And just start small and build from there. 904 00:44:52,079 - > 00:44:54,960 And don't just make it about you, you know, comment on other 905 00:44:54,960 - > 00:44:55,840 people's posts. 906 00:44:56,719 - > 00:45:01,519 Just start that journey, and you know, eventually you one day go, 907 00:45:01,679 - > 00:45:05,039 oh yeah, I did build that audience, and it started small. 908 00:45:05,199 - > 00:45:10,079 But again, you don't need to be appealing to the masses here. 909 00:45:10,239 - > 00:45:14,000 Right, write for your audience is my biggest takeaway. 910 00:45:14,320 - > 00:45:14,559 Yes. 911 00:45:15,039 - > 00:45:16,719 And they flock to you. 912 00:45:17,039 - > 00:45:18,880 Joe: Yes, yes, it is true. 913 00:45:18,960 - > 00:45:23,760 And I and I think I think one of the one of the uh the um 914 00:45:25,679 - > 00:45:31,039 insights from from what you said there is that you don't need to 915 00:45:31,039 - > 00:45:31,679 dumb it down. 916 00:45:31,760 - > 00:45:38,239 If if you look at what a viral post that hits you know 20,000 917 00:45:38,239 - > 00:45:41,760 people, it isn't that difficult to write, but it's not 918 00:45:41,760 - > 00:45:43,440 necessarily that useful to you. 919 00:45:43,599 - > 00:45:47,440 And I I would very I and we were talking before before the 920 00:45:47,440 - > 00:45:50,719 podcast about the amount of slop that's out there. 921 00:45:51,199 - > 00:45:56,159 And I would urge people to perhaps ignore what AI says 922 00:45:56,159 - > 00:45:59,840 about creating a viral post that goes out to a hundred thousand 923 00:45:59,840 - > 00:46:04,159 people and focus more on the hundred people that you really 924 00:46:04,159 - > 00:46:05,119 want to talk to. 925 00:46:05,440 - > 00:46:07,519 SPEAKER_00: Yeah, it depends on your objective, but if your 926 00:46:07,519 - > 00:46:10,719 objective is to find more leads, is uh you know, just talk to 927 00:46:10,719 - > 00:46:13,519 your audience, and your audience can be quite small. 928 00:46:13,760 - > 00:46:18,719 Um, and and I would just to our our point, um, whilst you might 929 00:46:18,719 - > 00:46:22,559 use AI to enhance your post, and that is very good instinct to do 930 00:46:22,559 - > 00:46:26,079 that and to do some of the research, at least in the 931 00:46:26,079 - > 00:46:30,159 beginning, I would make these posts yours, your ideas, your 932 00:46:30,159 - > 00:46:30,559 flow. 933 00:46:30,800 - > 00:46:32,320 Enhance it by all means. 934 00:46:32,400 - > 00:46:35,840 But I wouldn't start by just going, hey Chat GPT, what should 935 00:46:35,840 - > 00:46:36,559 I write about? 936 00:46:36,639 - > 00:46:38,159 Yeah, CRM systems. 937 00:46:38,239 - > 00:46:40,800 I I would err away from that because it's also a bit of a 938 00:46:40,800 - > 00:46:44,320 discipline you want to build yourself anyway, so that you do 939 00:46:44,320 - > 00:46:45,679 know how to bring AI in. 940 00:46:45,760 - > 00:46:49,360 But I wouldn't my orientation wouldn't have been to start 941 00:46:49,360 - > 00:46:49,679 there. 942 00:46:50,000 - > 00:46:53,199 Joe: Definitely, definitely, and and I think that's especially 943 00:46:53,199 - > 00:46:57,599 true in this age of AI because you want to be distinctive, you 944 00:46:57,599 - > 00:46:59,119 don't want to be the same as everyone else. 945 00:46:59,199 - > 00:47:03,519 And if everyone else and their dog can use AI to generate 946 00:47:03,519 - > 00:47:06,000 posts, they're all going to be very, very similar. 947 00:47:06,159 - > 00:47:09,440 And so the more you can get your voice and your experience into 948 00:47:09,440 - > 00:47:10,880 it, I think the better. 949 00:47:11,199 - > 00:47:11,760 SPEAKER_00: I agree. 950 00:47:11,840 - > 00:47:14,400 But don't be shy, I always say, like, as long as you're not 951 00:47:14,480 - > 00:47:16,719 writing anything controversial or that would damage, you know, 952 00:47:16,800 - > 00:47:18,159 the brand or the firm. 953 00:47:18,320 - > 00:47:21,920 Um, it's good discipline to be talking about and writing about 954 00:47:22,000 - > 00:47:23,920 because you build ideas from others. 955 00:47:24,159 - > 00:47:26,559 Joe: So brilliant, Karen. 956 00:47:26,800 - > 00:47:30,079 Thank you so much for your for your insights. 957 00:47:30,159 - > 00:47:32,719 There's so much here that people, I'm sure people listen 958 00:47:32,800 - > 00:47:33,840 to this two or three times. 959 00:47:34,000 - > 00:47:37,199 Um, you've shared your wisdom freely, and we all really 960 00:47:37,199 - > 00:47:38,000 appreciate that. 961 00:47:38,159 - > 00:47:40,000 Where where can people find you, Karen? 962 00:47:40,559 - > 00:47:42,719 SPEAKER_00: Well, I think linked to our conversation, linked to 963 00:47:42,800 - > 00:47:44,159 this copious play. 964 00:47:44,239 - > 00:47:47,760 So uh feel free, do please connect to me on on LinkedIn. 965 00:47:47,840 - > 00:47:51,119 Yeah, I love to follow great people, follow your journey. 966 00:47:51,199 - > 00:47:53,039 So yeah, I love to love to connect. 967 00:47:53,360 - > 00:47:53,840 Joe: Brilliant. 968 00:47:53,920 - > 00:47:56,960 There's a great I would encourage everyone who can to 969 00:47:56,960 - > 00:47:58,400 connect with uh Karen. 970 00:47:58,639 - > 00:47:59,760 Her insights are fantastic. 971 00:47:59,920 - > 00:48:01,840 Karen, thank you so much for your time. 972 00:48:02,400 - > 00:48:02,880 SPEAKER_00: Brilliant. 973 00:48:02,960 - > 00:48:03,840 My pleasure, Joe. 974 00:48:03,920 - > 00:48:04,719 Wonderful to be here. 975 00:48:04,800 - > 00:48:05,599 Thank you so much. 976 00:48:05,840 - > 00:48:06,400 Joe: Take care.