Season 9 | Ep36 Mike Ames: £39M in Exits. The Life He Almost Missed Building It.

Speaker A: I'm having to live a lot of my life through my grandchildren because I miss my children. Don't be that kind.

Speaker B: Mike Ames sold two recruitment businesses for a combined worth of 39 million pounds. His first sold to a New York Stock Exchange listed company for 24 million pounds at the age of 38. He then had money, he had loads of time, but he completely lost his mind.

Speaker A: She said on the last session at the end of it, after she charged me 140 pounds, well, Michael, just get a job and you'll be fine, I think. And we're done here now.

Speaker B: Ah, so he did and he started again at 39 years old. And what the second business taught him is what he now spends every single week trying to get into the minds of recruitment business owners he works with through his consultancy called Flair, that most of them are building a business with no finish line for a life that is not properly designed. He calls the model plw. Profit, lifestyle, wealth. Three things he said every business should deliver to its owner every single year. So asked him one question that was sitting in the back of my mind throughout the whole show. So I asked him what, after 15 years of working with businesses, what percentage of recruitment founders he's worked with actually make it to building a business around profit, lifestyle and wealth?

Speaker A: It's a scale, it's not binary at all. And half the time in reality, people don't want to let go of certain things because they.

Speaker B: This episode is not about exiting a recruitment company for £24 million. It's about what you're building while you're in it. Whether the business is making you wealthy or is it just keeping you busy, or whether the version of you that actually gets there will recognize the life you're living on the other side. So this is the brand new episode of the Rag Podcast with Mike Ames. The man who sold two recruitment companies has coached hundreds of founders and still believes that most are doing it wrong. Mike, welcome to the Rag Podcast.

Speaker A: Thank you for having me, Sean. I'm really, really pleased to be here. Very pumped up about it actually.

Speaker B: Oh, you had me on your show, so I brought you on my show. That's how it goes, isn't it?

Speaker A: Well, I don't know really. We have a lot of people on our show that, uh, don't have shows themselves or if they do, it's not appropriate for me to go on. I don't know. I hope you're the same. I just look for interesting people who I think I'm gonna like talking to and my audience, hopefully Will also like listening to. So hopefully that's the case today. I know we're gonna have a great show today. Loads to talk about for sure.

Speaker B: Now I think, I mean, I think with your experience we could do, we could, we could do this a million ways.

Speaker A: Right.

Speaker B: There's so many different angles we could go down. But I've got a plan for the, for the episode. But before we get into it, I've done a little introduction. I never do it justice. I don't want any of the story, I don't want any of the past. I just want the bird's eye view of who are you today? What do you do?

Speaker A: Okay, so, um, the elevator pitch. Yeah. Okay, so I think my experience, I won't talk about the past. My experience in business was always the grow and sell mentality. That's what I always had. And I was lucky enough to be in a, in a branch of recruitment where that was possible.

Speaker B: Yeah.

Speaker A: Uh, later on I realized that I was extremely lucky. There was just so many things that happened all at once which meant that I could do that now not so much. And for certain people to be able to build and sell a business was never going to happen. And yet that's what they strive for. Uh, fueled in many cases, I think by people telling them they can. This is the secret sauce, this is the magic formula. And in actual fact they never will. So what I do now is help people to build businesses which are high profit businesses. So it's no point working if you're not making profit. Um, there's a lifestyle element to it all because you've got to run it for longer. Uh, and ultimately they make you wealthy because you invest money every year in whatever investment vehicle that you want, property, stocks and shares, whatever. So that you've got a business which serves you really well. And by the end of it you're thinking, great, that's done its job. I've had a great life, I've made loads of money, I've had some good times. And now I can retire with a retirement fund which is big enough. And I really believe in that same, like, really believe in it.

Speaker B: I always say now it's about my whole goal is earning my exit rather than waiting for one. Like I'm, I'm building it as I go, I'm investing it as I go.

Speaker A: The irony is, weirdly, if you do build a business which is high profit and doesn't need you all the time, the chances are somebody will bite, particularly if you're niche. But that's a Side hustle. That's like, oh yeah, well I can have a slightly bigger uh, uh, dealer in the south of Spain or something now because of that, not because my retirement depends upon it.

Speaker B: So let's get a little bit of your story then. I don't want the full like because we could again, we could do podcasts on it. But you've, you know, you've had two businesses I believe that you've built and sold. Yes, he was the two minute version of that.

Speaker A: Well, they were uh, contract IT businesses pre IR 35 at a time when if you wanted to speak to a hiring manager, you could look in a book, you could get their landline and you could bring them up. That was the deal. No social media, no email, no LinkedIn, no Wi Fi or anything like that. So it was very much personality based. You pick the phone up and um, you started to build a relationship based upon your personality rather than hey, we can do this, that or the other. You started to build a three dimensional relationship based on rapport and trust and confidence and so on. And then eventually you said well look, you know, this is what we do. Can we provide essentially? And that worked incredibly well if you've got a personality and you were driven. So now of course it's completely different but I did that in the first time in the 90s. Um, and there were some ups and downs, you know, I had some very difficult times. I had like a little mini nervous breakdown in there and we were, we won awards. We were the 27th fastest growing UK private company at one point as well. So it was a mixed bag. And then I sold it and thought that my life would be something that it wasn't. So I started again.

Speaker B: When you sold the first time?

Speaker A: 38. 38.

Speaker B: 38 when you sold your first business.

Speaker A: Yes, 38 years.

Speaker B: When you say you thought your life or you'd feel something that you didn't or whatever, what, what did you, what do you mean by that?

Speaker A: I'd run out of steam with recruitment. Truth be told, uh, be careful what you wish for because you might get it. And I'd wished for a business that I could just lord in and out of and I liked and I got that and it just ate away at my self esteem really. So the sale of the business was the logical thing. Uh, KPMG found us an American business. They paid a lot of money. 40 was 24 million quid I think they paid for it in those days.

Speaker B: It's quite you the found you were

Speaker A: the founder, sole founder of that no Another partner. And then we had the widow of the senior guy, and he was killed in a car accident. I took over from him after 18 months. So. So we had. So I had about. Let me just see, about 30, 38 or something. I can't. Something like that. Whatever. Right. There's enough money to live on for 8 million quid.

Speaker B: Yeah.

Speaker A: My life. Yeah. Yeah. Um, and so, um. And so. So. But it wasn't because I didn't understand what drives me. The money is a measure. It always has been. I've always got an eye to it when I make sure I'm, um, being paid for what I'm worth and so on and so forth. But I didn't do it for the money. I did it for the experience and the building of the empire.

Speaker B: Yeah.

Speaker A: And the empire was taken away and. And it's like, got no purpose, man. So, um, I took some counseling because I was very depressed at the time. And, um, she said. I'm paraphrasing what she said now, uh, because she didn't actually say these words, but she said on the last session, at the end of it, after she charged me 140 pounds. Well, Michael, uh, just get a job and you'll be fine. I think, uh, we're done here now. And that was that. So I started a business with a couple of the guys who worked for me at the first business. And that's still going, actually.

Speaker B: How long ago? How long did that take from Exit in the first.

Speaker A: Oh, man. My spiral down was I worked for the Americans for two years till I was. Till 2000. Then I spent about six or seven months getting increasingly depressed. And then I had a meeting with the boys, and they suggested this thing, and we decided to do it. And that was 2001. That was launched.

Speaker B: When you say depressed, what was going on? Were you just waking up with nothing to do?

Speaker A: Oh, man. It's like, if you'd have said to me, mike, you know, do you want to play golf on Tuesday? I'll look at my diary. Oh, no, Sean I've ever had haircut. That day, I could only do one thing a day. My wife. My children were quite young, so My eldest was 15, I think. So they were still at school doing stuff, and she was running the house and seeing her friends and things, and I was just there. No purpose, nothing. And I've tried charity work. Didn't work for me. Tried playing a bit of golf. Not really that interested. Hated holidays. Still do. So ultimately, another job was a sensible thing. And I felt happier then, much happier. When I was working again.

Speaker B: So then you start a second business and what happened there?

Speaker A: Yeah, so the two guys I started with have been senior managers in the leadership team of the first business. Right. Uh. And, um, business was called Crimson. It's still going, actually. We sold it to Harvey Nash, but they kept the brand. They kept it going as a separate thing. Um, and so they. They were really good. Rob, in particular is very good, and he thought that I was going to be the MD of it, but that wasn't going to happen. I wasn't prepared to do that. I wasn't going to make that sacrifice again. Mrs. Ames made it quite clear to me that that wasn't going to happen, so. And, uh, then he just grew into that role. And I became disillusioned with recruitment again and just left. Became a sleeping partner in 2010. And then 10 years. Yeah, I was. Yeah, yeah, it was great. I mean, I still. I still see Rob. We go skiing together. I see Simon occasionally, the other partner, and I got absolute friends with them. But it just. I'd moved on, I think. And what I should have done was try something new when I was 40. That's what I should have done. But I went back to what I was familiar with, as you do, and started.

Speaker B: What role did you have if you weren't?

Speaker A: I did a lot. I've always been good at business development. I've always been very good at that. To building relationships with new people and coming up with ideas. I'm dyslexic, so I don't think like a lot of other people think. So I was in charge of that, the branding, all that. I'm not a marketer or anything, but the branding, all that stuff was me really, uh, driving. It's. The name was me. I found the name and all the rest of it. So I think. I think it was that and building on relationships I already had. But after you've done that for a while, Sean, it loses its zip. You know what I mean? You. That belt of adrenaline, dopamine, or whatever it is from doing something new just dissipates and then you're left with, well, I've just won another client or so what? Yeah, big deal. So I think it was time to move on at that point.

Speaker B: So you sold or did you just.

Speaker A: No, I just. I became a sleeping partner. So I kept my shares. Uh, I did. They let me take the Flare business, which I built up as part of Crimson. They let me take that and all the intellectual property and everything, and I. I swapped it for A few share, I thought that was fair. Um, so I ended up, I think owning just over a quarter of that, I think from memory. Um, and then we sold that 2017 to Harvey Nash. I think it was like a 15 million deal, I think bit less, but anyway. And so, um, but that period was great for learning and understanding of what it is that I wanted to do, I suppose. And that was the recognition as well. After we'd sold Crimson, it then became clear to me how difficult it is to actually do that. It's like really difficult. And there is no secret formula, there is no magic bean that you can buy. Don't believe any of that because it's just nonsense really. There's a few things, boxes you have to tick. And if you can't tick those boxes, no chance.

Speaker B: So what boxes do you think people have to tick?

Speaker A: Okay, so white collar, higher margin stuff, contracts or not temp contract work or at least work where you've got signed up for preferred supplier deals which are say maybe three years long and you're locked into that. So people, buyers can see this continuation of high profit business. Of course, um, a really good management leadership team stable where there's what they call, uh, low dependency. So there's nobody in the business, if they left, really hurt the business, which of course in recruitment is very hard. So looking at process over people, really, if you don't have all of those things in place, man, it's just really hard, you know, if you're a little perm outfit putting bums on seats, five or six of you, you know, doing, I don't, uh, know, whatever you would do, million in fees or something, then. No, no one's really going to want to buy that. You've got to do an EBITDA in excess of a million to get a lot of people interested. Unless you're very niche. I've got a real tight niche and somebody wants to buy that niche, then that's different then. So

Speaker B: 2017, he took the flare brand in 2010.

Speaker A: Yeah, I did, yeah. Yeah.

Speaker B: And what was the vision for that?

Speaker A: It was just a hobby really. I just wanted to, to do something. I wasn't working for the money. I just wanted to have a purpose. So, uh, my pa, uh, was with me in Crimson. She came with me, Mel, and we just started doing general business coaching for people I knew, really, I'll come and help you to help people to be more organized. And then I drifted from that into professional services because they don't know how to sell at all. But they're Relationship driven. And I am a relationship salesman. That's how I sell. That's how I teach people to sell. So that was great for a bit and then I went back into recruitment simply because I got a lot of credibility in it. Been in a long time, seen lots of things, been successful obviously, which helps. And I like recruiters. I like the way they are, their mentality, the work they do. There is never more of a thrill than when you put a bum on a seat, when you shake hands and say, yeah, that's a deal. I don't think that goes away really. Um, lots of other things do, but that doesn't. So just drifted back into it and now we've taken a further step where we really only do certain things with people to lead them through a journey to get a business which is this higher profit business that isn't dependent upon them, which is, which is what you need to do really. And then run it for as long as you need to run it to, as you say, fill up the coffers so you can go when you're ready.

Speaker B: And that's the bit that people don't, whenever I ask them, like they don't have a plan that goes beyond like it's very hard for them to articulate backwards from where they want to be. And that's age, financial number, how much money do they need to make annually at what age to be genuinely comfortable. And then it's working back from that.

Speaker A: And yet that's incredibly simple really what you should do, and I had my first one done in 1992, I think is have what they call a lifetime cash flow done. So you go to a wealth manager or an IFA and you say one of lifetime cash flow. And they say, well, okay, they take details about your income and your expenses and your children and you know, yada, yada, yada. And they put it into a model which has been around for donkeys years. And it says, well, okay, if you want to retire at 60 and you want to take this much Money until you're 99, you need to be worth this much. Okay? That's the deal. So it's dead simple to do. We've got a little table which people can have. If anybody wants it, just message me or I'll send it to you. And by the way, you won't be on an email list, I absolutely promise. No. Right. So, but it's just a thing of two tables that will work out what they call your magic number or your walk away number and that's it. And Tells you how much you need to invest each year. But that's not as good as having it done by a professional. It's not the same, but it's not difficult to work that out really.

Speaker B: Then you refine it.

Speaker A: But when you've worked that out, then you know what size business you need, you know, and it all you've got to do is take what you have now and if you like, pro rata it up until you get the net profit you're looking for. Because it's the net profit that obviously pays for all of this. Um, and I'm sure that there's better ways of doing that. Well, I know because we have a spreadsheet that does it. But that's simple enough. I've got three people now I need to double my profit, so I'm going to need six people for a start off. That's a good way to begin with. Um, but you can't kid your way through that, Sean. That's how much money you need and so that's how much money you're going to need to be worth if you're going to come out. And that's how much you need to put in every year to get it. It's just numbers. You might not like it, but it is the way it is. You know the big problem though, Sean, people start to look at that too late. The best time to look at it is when you're 18 years old and you come out of school or 22 years old, when you come out of university. That's the best time to look at it and start investing. The second best time is right now, today.

Speaker B: But those ages, you don't know enough about yourself and your life. I think, let's say that the average person listening to the show is between 30 and 45. Right? Let's say, I mean, I'm turning 40 and just under two months. Um, I think I'm a good barometer for probably the listener in terms of their age, young family, like you say, where you were, uh, when you sold your first business kind of person. So you're probably at an age where you've got dependencies, you've got responsibilities that, you know, probably it might not be adding that much more to it that your family's life's there. You know, you've set up a business a couple of years in, depending how far, and you're thinking, like, say, do I need to grow and scale and exit? Because you want this financial number that you don't even know what the number is. I Always tell the story. Like when I, I told a coach a few years ago, I want 5 million, he was like, okay, why do you need 5 million? Tell me the lifestyle you want to live when you, you know, when you get this 5 million. And I explained the lifestyle and he started laughing and I said, what you laughing at? He goes, well, I'm still waiting for the bit where you tell me where you explain why you need 5 million. Like, he's like, your life's pretty modest, like you're not asking for a lot. So. And again, 5 million in a portfolio is different than 5 million cash that you're trying to do shit with today. It's very different way of thinking.

Speaker A: But

Speaker B: I think a lot of people, like, probably at a point where they, they, they do know their, their cost or they've got an idea of their, their costs, but they don't know they can't project that. You know, they probably always want more and more. It's that more, more, more mindset in our, our industry promotes that is the problem.

Speaker A: Perhaps years ago, measure of success was the word more. So I'm successful this year because I've got more revenue, profit, turnover, staff, whatever than I had last year. Next year I'm going to have even more and then I'll be more success. I think that is subsiding a little bit now because the measure of success is the word enough.

Speaker B: I, uh, was just going to say that that word doesn't exist in our industry, but I, I'm saying it more and more.

Speaker A: It's like, yeah, you should do that because, you know, I had a client in the Jewelry Quarter in Birmingham and I went up to visit him and he had, uh, got, um, he was in a, an old silversmith's workshop. They're all converting everything nice, you know, exposed brick and everything very trendy. And we were talking about it and he knew a little bit of history about the companies had been there. And it was set up, I think, by Jewish immigrants in the 19th century, you know, in a house, and then they da, da, da, and they hand it over to the son and the grandson. I think grandson had sold it or whatever, but there was no thought for the people who set it up. Well, I'll build and sell in five years. No, no, no, no. This is my job until I retire, and then I'll live on the proceeds from it. It's kind of that mentality, I think. Now, I'm not saying you replicate what happened in the 19th century, but, no, this business I'm going to make it so that it's easy for me to run. I think a lot of people want to get through it quickly because it's hard and they don't enjoy it very much and they work a lot and they don't take as many holidays and they don't, uh, see their children or they're bad tempered or whatever it is. So let's get it done quickly. But it's counterproductive, counterintuitive. My gran used to say, Michael, more haste, less speed when I was getting ready to go to school. More haste, less speed. In other words, the more you try and rush things, longer things take. So figure it out. Figure out how much net profit you need to make each year to fuel the lifestyle that you want. Top up or add money to your retirement fund and start to pay off your debts so that when you reach retirement age, you've got no debts. You've got a, uh, retirement fund which is going to pay a certain amount each year based on say, 6% return. And you've had a great life. Wow. I mean, how cool is that? Run it for 20 years, then if you like, 25 years. Because it's not a hardship anymore. That's the aim, I think, to build that balance into your business because that changes everything. Then it's not the same. I tell you.

Speaker B: It's also a lot easier to be very good at something the longer you're in it. Like.

Speaker A: Sure, yeah.

Speaker B: And you probably found that in your experience, like, the longer you're in one company, one area, you get better.

Speaker A: You know, it's the mark of a successful business. It's the, the volatility of that team. The more volatile the team is coming and going, the less profitable it will be. It's always the case. Uh, there's actually mathematical reasons for that. But I'm taking from me, if you've got a stable team of average people that you put together into a really good team, because the team ain't the same as the people in it. You've got a really good team made up of average or above average people who are steady and stay there. You, you will always make more money than if you've got this kind of team of this high hit, ah, you know, the big billers, these kind of high people coming and going, yada, yada, yada. Half, uh, of them can't do what they say they're going to do anyway. They just burn money. Don't do that. Think about building a team. What do you need for the team? Get one of those and Then see how that works. It's a much better way of doing it. Slower. Uh, I'll admit, but not that much

Speaker B: slower, you know, again though, the word enough's the bit though that people don't think about because you say slower for what? Slower to what? Slower to. Again, when you know the number and you're like, well, that's the number I need and I'm pretty happy with it, then it's quite easy to figure out what I need to do to get there.

Speaker A: Whereas without that, it's always it. It's when I do this, you're right. We got these. We come up with these numbers. 5 million or whatever you come up with like. Because it sounds nice, whatever. Uh, but actually your fund, generally speaking, your fund is going to need to be between a million and 2 million for most people, unless you've got a very extravagant lifestyle. If you're going to go about 60, right. So obviously if you vary the date you go or whatever, that's fine, but. And to get that, if you start early enough, it's 30, 40 grand a year invested, 40, 50 if you're a bit later, maybe. Well, because compound interest obviously is your friend. So actually that's eminently doable in our industry. What's that, extra four placements a year or something? Four placements you're making for your retirement fund and we're done. So I think once you focus on what it is that you want from your business, not just in terms of money, but also free time that you're looking for and job satisfaction so that you go to work, you enjoy what you do when you get there, and you take plenty of holidays or breaks for you and your family, I don't see a downside with that. Time is not the same as I really hate this job. I've got to get it done quickly. No, no.

Speaker B: So what made you go. And was it, Was it part of that? What made you go into consulting rather than building a third firm? Was it about.

Speaker A: I come from, uh, it. Originally I was. My degree was in computer science and I spent the first seven or eight years, I think, in IT or computing as it was called, those data processing. So, uh, as an analyst for a good deal of it, so I would turn up and talk to people, try and figure out what the problem was, figure out a solution, design it, implement it, put it in. So. And that's been my life for many years. I love it. I love all of that stuff, Love the IT world. So all I did was turn it into a business sense well, okay, this isn't working. So we'll debug it, figure it out. Ah, uh, right. Okay, I see the problem. Design a solution, implement it. Doesn't quite work the first time you do it. Of course, it never does. Analyze it, fix the bugs again and go again until eventually you end up with something that works. Then we're done, finished. I'm off now. And I really like that project based, um, life where you figure out what the problem is and then iteratively you put it right. I think that's another mistake that many business owners make is that they think things can be done quicker than they actually can. Particularly if you want to change your business because it's not working in the way that you want. You know, there's very little you can do in three months. So whatever you want to do is going to take longer than you think. And you have to be comfortable with that. There's a number of clients I don't work with not because I don't like them or because I can't help them. It's because they want to do it too quickly. And I know that won't work. Yeah.

Speaker B: And our industry is full of people that think in such a short term, um, yeah, way.

Speaker A: Because I remember the first coach I had in the early 90s, Anne Marie Hanlon, her name was. And she said, she said, you think and act like a recruiter who owns a business and you've got to think and act like an owner who just happens to do recruitment. And it took me about 20 months, nearly two years to make that transition from being a recruiter that owned a business to being an owner that did recruitment. And that sounds easy, but it was really hard because the things that make you great recruiter, like being reactive, being transactional, being short term focused, come on, let's make it happen. Is exactly the opposite to what you want to be a great business leader. It's about thinking and planning and strategy and standing back and taking your time. They're completely different. And I think in any kind of business you have to wear more than one hat. One of them has to be a, uh, we're going to make some money today hat, which is all the transactional. Let's get it, come on, let's crack on and do it. The other one, um, is, okay, well, we need to climb up the biggest tree in the forest and have a look around and plan the next stage of the journey and understand we're going in the right direction. Completely different. And I don't think too many Recruiters have got the ability to swap from one to the other. They're just in transactional mode all the time.

Speaker B: Is there a way you advise people to wear both hats?

Speaker A: Yes, yes we do. Um, there's a number of things you can do. I'm going to say this, please don't. You know, I'm coming to the end of my time and I say it the way I see it, right? Get a coach or get, get not necessarily a coach, get a mentor, get someone who can hold you accountable for change. Who is going to say, right, okay, well, what if you changed this month? What are you going to change next month? I don't care if it's teeny tiny marginal gains, they all add up. Make yourself accountable to somebody for making changes to your business. The other thing is I'm a big exponent of colored time. So colored time means that, uh, you assign a certain amount of time each month to certain types of activities that you would do working on your business, which is where the change comes from. Is colored time purple? Uh, so it's purple time. So if you look at my diary in outlook, you'll see slots of purple time. That's when I work on the business. Okay. There's other stuff like promotional stuff and there's, you know, sales and yada yada, yada, yada, yada. Right. But purple time is really important. And I book it in and I stick to it. I do it and I think start with two hours of. Two hours a week if that's all you can manage. Yeah, but that two hours is like a client call. You have to do it. And the trick is that you don't just sit down and think, oh, it's purple time. Now what shall I talk about or what shall I do or what shall I think about? You already know what you're going to do in that time. You haven't got to think because if you have to think about it, you know what you'll do, your emails or make some calls or something. So know exactly what's on the plan that you're going to change next. And take your time, get it right. You'll find you'll get well. More haste, less speed. Thank you, Grant for that.

Speaker B: I like that a lot. And I have similar purples actually sales in my diary. So it's different. But I've got a very color coded section. I have, I have a slot every Thursday morning for two hours where I just don't, I don't book out any meetings and Monday morning I don't as well. And I've had so many. I shared the fact that on a Monday morning I don't meet anyone till, till the afternoon. Like, I just don't want to do it. And the amount of abuse I got on that post on LinkedIn of people saying, like, you should be standing up with, with your team on a Monday and all these. I mean, one, I'm not a recruitment business, so it is slightly different. But two, I've built a business in a way that I want to live it. So, like, I purposely don't want to have to wake up in a Monday, drop my kid off at school and jump straight on calls. Like, I don't want to do it. I want to ease in, I want to sit and think, I want to write content, I want to, I want to make sure my whole week is designed in a way that I'm happy with and I want to take my time. That's what I want to do. And then by 2 o' clock on a Monday, I'm ready to go. And that's working for me.

Speaker A: But that's because you've designed a business with intent. Yeah, that, uh, that's the, I think too many business owners, recruiters or, or otherwise almost let the business happen to them in a weird way. The business makes me do this, that or the other to start with. I know that's the way it is. You know, I know that's the way it is. We had, we had, when we started off, we had a rotor to clean our toilet in our little office because we couldn't afford a cleaner. I know, I get it, we've all got to do those things. Fine, but you've got to put a backstop on it and say, we're not doing that forever. I'll do it now, but I'm not doing it. And gradually you design a life that the business pays for and fuels, where you take the time off that you want and have enough money to enjoy it. And when you're at work, you do what they term your business superpower, the thing that you can do which has the biggest impact and you enjoy doing and you really are successful at it, because that's how you make a business. That's high profit, essentially, not by doing stuff you don't like doing. That's not going to.

Speaker B: Let's get into that, because as a seasoned recruiter, you know that a CV never tells the full story about someone. Candidates share what really matters during conversations. They tell you on calls, in the interview, over email, what they're motivated by their salary expectations, plans to relocate, etc. Most of the detail ends up being buried in notes, forgotten. It's not on a resume Now. Our headline sponsor, Atlas CRM changes all of that. It's the first AI native recruitment platform built to eliminate admin. It captures every single conversation automatically that you guys have and turns it into something you can use. They've got something called Magic Search which is now out, right? And, um, what you can do is ask IT questions like who talked about one in a four day week? Or who mentioned they're open to relocating next year. It searches across your entire database and pulls the answers instantly. So it's not about keyword guessing and digging through old notes. You get insights from real conversations, not limited by CV fields and coded filters. Atlas also makes BD easier with their opportunities tracker. You can track and grow with client relationships powered by generative AI and that's built into an existing workflow, so you don't need any extra tools. It's in the CRM. If you want visibility of your business. Atlas smart dashboards give you clear view of the pipeline across your business. And it's not theory, right. Atlas customers have reported over 40% EBITDA growth and 80 increase in monthly billings from adopting the platform. Atlas is built for agencies who want to grow without adding more manual work. So don't miss the future of recruitment. If you're sat there thinking, I need to bolt AI into my platform today, don't even bother. Just get started with Atlas and unlock your exclusive listener offer@, uh, www.reruitwithatlas.com Theragun all right, let's get back to the shop. I've got an ang. I've got kind of my thoughts on what a business looks like in today's market. And you know what my clients are saying. But you're speaking to, you know, hundreds of recruitment founders as well. What are you seeing right now, like, from a mood perspective, how would you judge the current, you know, June 2026? What's the current climate like?

Speaker A: Just, Just checking. We are booked in for the next three hours, aren't we? Sure.

Speaker B: No, we're not. So make it quick.

Speaker A: Okay, of course I will. Yeah. No, um, I think that obviously we can all see the markets changing dramatically. Um, AI has turned up and it's disrupting things. Some things are better, some things are worse. LinkedIn is changing its policies now, as you may have noticed. There's a lot less impressions on posts. LinkedIn likes some things and doesn't like other things. And the things that worked in the past don't work anymore and you've got to do new things. Um, I think the rise of TAs and fractional TAs is making life a lot more difficult. Um, I also think as well that you can see that the clients have been for some time now, but they're using their position. It's very much a client led market and they're using that and they're, dare I say, they're bullying. Not bullying, that's the wrong word. But they're just leveraging the position they're in. Hey, you know, it's business, isn't it? Uh, and I think in all of that we're all trying to make our way. But I'll tell you now, in all the time that I've been in business, 1989, we started. All that time, three things have stayed the same. Three obsessions have stayed the same. The way they're implemented is different technology and all these different things. But, uh, the first obsession is the business is there to work for you. All the things we just talked about, right? Put yourself first, what do you want? Make that happen and then we'll see where it goes from there. Obsession number two is about quality, right? So excellence really. Too many people think that average is okay and it isn't. I made a post today. I found um, a complaint letter which is 4,000 years old. It's a clay tablet. Somebody had bought some copper ingots and they didn't think it was very good quality and the person there had been badly treated by the buyer. Right. That could have been written today in recruitment. All, uh, right, quality of the product, quality of the service, the delivery aspect has to be absolutely perfect. And then the third thing you need is a stable team. You need a really good team that can win clients and look after clients. It's never been any different to that. Be obsessed with it. And I think the 360 model for me is very damaging. I think it's always been ropey, quite frankly. But in this market it's just not uh, very good at all. We've all got companies that we've seen which are 360 based and we can say, yeah, they're successful. So everyone else can be successful. No. Just because you buy a lottery ticket, because someone else bought and won, doesn't mean to say you're going to win. Statistically, the 360 model works against you. It's not good. Really?

Speaker B: What's your opinion on that? Why?

Speaker A: Well, uh, if you think about 360, what does that mean? It means Winning clients means getting vacancies, means managing clients, means finding candidates, vetting candidates and presenting those candidates. There's a lot of activities in there and they're very different. So the mentality and skills that you need to be a new business developer are at the exact opposite end of the spectrum that you need to be a great client carer. They're just not the same really. Um, to be someone that goes out and hunts great candidates, to be somebody that can present them in a marketing way to people to, to sign them up or get them in for an interview, they're just different skills, different requirements. You want, you want people who can do all of that, then is that really what you want added to that? There are people out there that can. Of course, yeah, of course. Add it to that. If they go, they're going to take a revenue stream with them and they're

Speaker B: going to start a business probably.

Speaker A: Or someone's going to come along and say, you're really good, have this money because we need you. Right? So you're building your own competition. Like that person who's sitting in front of you is the dog's bollocks when it comes to the three. You can do it all right? You're just getting that person ready to go and steal some of your clients and some of your business. So I don't think it wins on any stance really. And you know that thing in recruitment where you become a yo yo, you can see it all the time now. Mostly it's because they've lost a big client or they've lost a big biller. Mostly that's what it's down to. Well, why would you do that to yourself? You don't need to do that. It's not necessary to do that. Half the people out there that are so called 360s hate BD anyway. And if you said you don't have to do any, would be thankful, provided they don't earn less money, which they won't. You tend to earn more money in a layered model.

Speaker B: I'd say most of the founders say the opposite though. They want to do BD and they hate delivery like the ones.

Speaker A: Yeah, that's exactly right. And yeah, and so if you think about. Because there's two types of BD and this is important because if you talk to most people about bd, it translates into getting a vacancy. That's what BD really means to them. Or selling a candidate in, you know, NPC or something, right. And that, that is a form of bd. It's called Tactical bd and I'm all in favor of that. If you're sure to work, get on the phones, get a vacancy, try and make a deal, uh, short term. But if you're running a business alongside that, you need to be a strategic business developer as well. Let me tell you what that really means. To be very clear to the listeners. If you do the analysis on your client estate, you'll probably find that a smaller number of your clients generate the majority of your revenue and your profit. That's normally how it goes, right, the 80, 20 rule. Okay, so and then when you look at Ah, those 20% that generate all this money, the vast majority of those are going to have come from some kind of relationship. You can do the numbers for yourself. If anyone's listening to this, just have a look at your client estate and figure it out. Won't be too far adrift. So you need to be able to build relationships with high value clients. If it takes a bit longer to win them, well, fine. Because when they're high value it means that they give you the kind of vacancies that you can fill. They're higher fees, they're prepared to consider, um, uh, retained or at least exclusive. They have repeat vacancies. So you make one hit, win a client and you get vacancies for some time to come. And they want to work with you, not against you. So the terms are fair. Now we know there aren't that many out there. We know there aren't. But they're not going to come from a cold call these days. Not going to happen. Tactical BD these days does not really generate many high value clients the way it did, say three, four, five years ago. So you need somebody to be in charge of uh, strategic bd and that is normally the owner. And it's great because the owner's not going to leave.

Speaker B: Yeah, I mean they usually enjoy it when they get out their own way because I literally just before this podcast was speaking to an owner of a business who, you know, 10 person business, really strong, really profitable and you know, he's worried, he's, he's the, he's too embedded in the, in the, be in the face of it and that uh, he needs to pass everything off to everyone. And I was like the bit, what is a bit you enjoyed? He's like the business development like, well what, so why are you trying to get rid of that then? Why are you trying to give that away? Because that's the hardest thing to give away by a mile. And you know, you Said you were. The reality is he's too involved still in the, in the delivery and he doesn't. And he's actually not doing much business development at all. So he's like, I'll just buy someone to do that.

Speaker A: And I'm like, well, buy someone to do the delivery.

Speaker B: That's what I said. I said, I think you're better off, uh, investing in the delivery side, getting that right and then giving yourself the freedom to do that bit. And look, there's no reason why you can't have support on the, on the sales side. But you're definitely, um, when you build

Speaker A: business, build dependency into it. So you don't want a bunch of people who are independent of you and of the company. You want a bunch of people that work for you or are dependent upon you. If they go, they won't be as good somewhere else. Yeah, right. And a key dependency, that's the opposite

Speaker B: of what people think.

Speaker A: But the numbers bear that out, you know, how Many was it? 83% of recruitment companies have got 10 staff or less than half of those are solopreneurs or whatever. I can't remember the numbers.

Speaker B: 81%. I think I read it.

Speaker A: Ah, there you go. Big numbers. Anyway, why is that? Not because they don't want to grow, it's because they grow and shrink, grow and shrink because they build independent people who leave. Yeah. You know, so if you're. Because, uh, as the owner of a business, and I'll come to how you scale this up if people are interested, because you can scale this model up as well, by the way. If, if you're the owner of a business and your main job is team leadership, strategic, um, BD and an account directorship. So you're not day to day account management, you're account director. You've got a relationship with all the key clients in your client estate. So someone leaves, no big deal because you've still got relationship with them. If you do that, you can generate a shit ton of money. So we had three and a half of those in the first business and it turned over 40 million quid, which in today's money would be about 60, 70 million quid. Just some three and a half strategic developers. Right. So if they're focused and they do it right and they win the right type of clients, then it will fuel the business. And if your consultants want to do a bit of tactical bd, well, fine, dip your bread if you want to, you can earn a bit more money. But don't let that move away from when we give you a vacancy. You again.

Speaker B: The problem is I go back to my own experience. I was a, I was a very good 360 biller. Like I was a 700 grand contract biller that did the whole piece. And I built a team around me delivering on things. But I was always really told by my boss, you're not doing enough bd, you're not in front of enough clients, you're not meeting. And you're so good at it when we get you out there. But you're not out there. But I'm filling jobs and I'm so. I was always playing a game of priority and the priority was we've got these vacancies I need to fill and then, and then you, you play that yo, yo, where actually I've just been so heavily dependent on delivery that I've. I've now not got the pipeline I need and I need to get back out there. And so, you know, you're constantly just running.

Speaker A: There is that, uh, there is that frequency and you normally find it three good months in the blank or whatever it is. Right. And so, and that comes from a lack of investment in bd because tactical BD is very immediate. I'm going to do some calls and get a vacancy. Strategic bd, you can to a certain extent control when the work comes in. Because at the moment, just building relationships, you're building trust, affinity, rapport and confidence. That's what you're doing layer by layer. Uh, and if you're busy, then don't push for the work. If you're not busy or you feel you're not going to be busy, then you can sort of say, well, okay, can we talk about doing some work now? You know, I think I like you, you like me. I think we trust each other, we've done some stuff together, we've added some value. You've come on my events, whatever it is that you've done for them. We've been out and drunk some zero guineas together or something. So I think you can control that a lot easier. And you should do. A day you don't sell is a wasted day for sure. So even if it's just a few emails or a couple of calls or something, I think the best kind of call you can make, quite frankly, is a call with no agenda. I've always said this, just ring people up and say, it's been ages, how the devil are you? What's going on?

Speaker B: It's the opposite of what you're trained.

Speaker A: Yeah, but for tactical bds, it has to be about getting a vacancy. I get that. But that is not what, uh, builds relationships with decision makers in high value businesses. That's not how that works. Because you just feel as though, um, the only reason you ring me up is to make money out of me. And that's fair enough. But if you're going to treat me like that, I'm going to treat you like that as well. So I don't see you any different from any other agency. Okay. It's how you treat people more than anything else, as well as being really, really good at delivery, obviously, as we said. But it's, it amazes me how people make it much more complicated than it really needs to be. And I think it's fueled by this myth that the build and sell on the phone's aggressive hire the top billers, put this team together. It's nonsense. It's just.

Speaker B: No, you do still get the odd story where, like you said, it's like the lottery winners, where they're still doing it. And then people are like, all right, I want that. I'm like, but the volume is not there. What, what are the people that you know then, the founders that are thriving, what do you think they are doing differently to the majority?

Speaker A: I think they are really, really interested in deliver, Delivering a great delivery service. Like, uh, really good. That they're, they're really interested in, in finding the right people for the role, really understanding the role. So in the rushes of, uh, delivery, they get that. Or at least people in their team get that. They understand that. I had a guy on my podcast, he's an American worth coming on perhaps and talking to you guys at some point. His name, uh, Shane Fairfield. And he, whenever he wants work, he can get it because he's exceptionally good at delivery and he's exceptionally good at managing his network. And I see that now in all the successful businesses, they've got big, strong networks. And it's not just the size, it's the strength of them as well. They can talk to people, they can ring around, get a few vacancies, or they ring in and someone just gives them a vacancy. He often, Shane often gives vacancies away because he only rang in for a chat, someone gave him a vacancy, so he has to give it to one of his mates, bless him. Um, but there is this at the heart of it and an obsession with excellence, an obsession with it. And I think that in the days where you could just send a CV and that was about right. And because they're short of candidates, they'd look at it and take it. They're gone forever now. Got to be top of your game on all of it. Yeah, And I see that over and over again, particularly in the smaller business. By the way, the window cleaner is now cleaning watching.

Speaker B: I'm like, this is the first podcast I've ever had someone wash the windows in the background. Uh, you've just won the award, Mike.

Speaker A: Yeah, yeah, yeah, yeah. It'll be click. We got 42 windows and doors. So he'll be here for some time.

Speaker B: Come on, get your windows cleaned. So, I mean there's loads of. I could unpack so much of what you've said. Um, I, I call what you've just said a trusted advisor. Right? That's the phrase I'm, I, I believe, I think there's a commodity, there's commodity recruitment and there's trusted advisory. There's an exec. Search firms have always been, you know, premium fees, having long term conversations with clients. They're not just in the ones and two weeds. They're building the vision with customers. And then like one of my clients, I posted about it today and he's just messaged me going, look, I've just got a client referred to me come inbound. I've managed, you know, they've paid me the whole fee up front and they've told me who they want. And he's laughing, he's like. And I'm like, what's that word? He's like 32 grand. He's like, ultimately, we, we all know that one candidate might not be the one that he gets, but they trust him enough to say, look, here's the fee. We know you're going to deliver this. You understand it better than anyone. Like, I put it on LinkedIn and the amount m. I've already had loads of messages of, and comments of negativity. This is, this would never happen.

Speaker A: I'm like, I don't think it is.

Speaker B: Well, I know it's not. I've got it there.

Speaker A: I didn't know you. Yeah, I know because I've seen that myself. Yeah, uh, we, we had, I once was working with 7 Trump water. It's a guy there I knew really well because I always say treat clients 95 the same as your friends. So however you treat your friends exactly the same, right? And we've been out, uh, drinking together. We've done all sorts of things. I used to bring him up, go and see him, have a coffee and shoot the breeze, right? He rang me up, said, I need a team of I think it was 10 people. Big number. He said, I got a list. These are the contractors I want. Could you just make it happen? No. Oh, you got to do this at reduced rate. No, we did it at our standard rate. And I just rang these contractors up, sorted the interviews out, got them in, and it was done. So, yeah, sure, it happens, but it's based on trust. Someone said to me years ago, I shouldn't get the saying right. It's not what you know, it's not even who you know, it's. It's who you know that likes you, trust you, and uh, feels valued by you. And I think that's true. The more people in your network that feel like that about you, the more successful you will be.

Speaker B: Agreed? Agreed. What, uh, if you were going to like, design out, then the kind of perfect P. PL I keep wanting to call it a plt. PLW recruitment is a profit lifestyle wealth business. Like, what does a founder listening, what does it typically look like? Let's say they're trying to get to that 2 million to 3 million pound.

Speaker A: I can do that for you. Okay, so big fees for a start. Nothing less than 10 grand, preferably 15 to 20 grand fees. Right. So, uh, especially since with AI coming along, it's going to start nipping at the lower fees anyway, one way or the other. So bigger fees, um, a proper review of the client estate, of the clients that you've got in your client estate, how many of them are really high value in the way that I've just described earlier in terms of the vacancies that they have and how they treat you and all the rest of it, because you need more of those. You got to be niche. You can't be generalist anymore. And in fact, increasingly, I think you've got to be micro niche. Really. I think it's that, uh, it's got to that stage now. Um, you got to have all your collateral, all your key messages lined up so that when you talk to anybody, the message is consistent. This is what we are, this is what we do, this is the people that we work with. This is a result that we get. Here's proof over here, plenty of video testimonials that say, you know that thing he says he does, it does. Right. And then you've got to have a machine which is going to draw people in. We've talked about this before in, in the thing that you do with people that draw people in, start conversations, and then some of those conversations will turn into business. And the one person that does that In a PLW is the owner. Yeah, they're the owner. They're the people that do that. And then as soon as it gets to the, to the delivery work, which by the way is between 70 and 80% of the time spent anyways finding an. And um, uh, validating or vetting candidates. Someone else does that. That's the team to build. And you can build an enormous business if you do that. And then what if you wanted to make it scale still further? Although I think if we go with the enough. As soon as you've got a business which is generating enough money for you to live on, pay off your debts and build your retirement fund, I'd slow the progress right down. I don't think you should ever stop. I think you should always continue to grow very slowly. But if you do want to, that's called a pod. It's made up of somebody who brings business in and looks after the high level clients, somebody that looks after the clients on a day to day basis and someone that finds and qualifies candidates. It's pod really. You can just add another pod. You usually find someone in the business that's got the potential to do that. Then you need to get into share option schemes and a whole bunch of other stuff to hold them there. Um, but that's how we built ours. So the first business we had seven pods, five of which were recruitment, two of which weren't and that's how we managed to grow. Because you don't need to do that. One pod is almost always enough.

Speaker B: That's what I'm thinking, like why? I had a guy literally asked me that last week. He was like, look, I'm um, um, um. He's not even cracked what he's doing. Nowhere near cracked it like they're making money. But he's stressed out of his mind. He's doing all end to end and he says and then his next plan was to launch a new division, a new industry. And I'm like no. Until you've got this to a point where we're making X amount of money, why would you think about complexity of new markets? Like it just doesn't make any sense.

Speaker A: It doesn't. And half the time that you've seen that thing of a scissor company, if you're listening to this, I've got my fingers like in a V sign, but on the side, the top finger is, is turnover. The bottom finger which is going down, which is profit. It's very common, right? It's called a scissor company. And the problem is people start to grow before they maximize the profit on the team they've already got. So they're baking in inefficiency and low productivity. And the next iteration of their business is going to make less money, certainly percentage wise and often actual pound notes wise than the previous iteration. So when they add numbers to it, it doesn't become more profitable, it becomes less. Make sure you've got that foundation in place. Maximum profit per person. You can work that out. Everybody's got to be very close to that maximum level of productivity. Then you can hire someone else or go into a new market if that's what you want to do, or open a new desk or whatever it is that you want to do.

Speaker B: Have you got like a profit margin amount that you think is good practice to aim for?

Speaker A: We have actually, we have a range of. It does vary according to the type of recruitment that you do, of course, whether it's contract or perm. We don't deal with temp agencies like lower level temps or anything like that. We don't do that. So I haven't got any numbers around there. But you need the way in which to look at it, right? Is the best way to work this out is look at your business when it was very small. One or two people, perhaps just yourself if you like, look at the profit that you are making at that point and divide that by the number of people that you have. That's. And you might need to kind of. It depends how long your business is going. You might need to scale up inflation, but broadly speaking, that's going to give you a maximum profit because that's when you're at your most productive. So how close can you get to that maximum level of productivity? It's the best way that I know that people can do that. And then that gives you something to aim at. And I always thought with hiring people, you should only hire based on triggers. Recruiters are often attracted to shiny things. Oh, look, just in this, uh, consultant who's come to me and they've got this, that and the other. Let's get them in. We're not quite ready. No, no, no, no triggers. How much profit are you making per person? Um, how many recruit. How many vacancies have you got that you can't deal with, that you're not. Your conversion ratio is quite low. Um, how many clients have you got in the client estate generally bringing out vacancies, uh, on a regular basis? Use triggers to say, when we hit these markers then we'll hire someone else. As opposed to I'll just hire someone because they've just come along. It's the way to rack and ruin that one, I'll tell you.

Speaker B: So if you build a pod, which is typically like say the, the founder doing the front end, maybe one person who's responsible for managing clients and what

Speaker A: was between four and six people in total.

Speaker B: So then what we talking? Well, again, rough, rough guidance on percentage profit margin end of the year, like ebitdar. What do you think it should be?

Speaker A: Um, well, again, obviously what you're aiming for, an EBITDAR of a company of that size, of a pot of that size. It does vary wildly.

Speaker B: Just give us a, give us a rough ballpark. No one's holding you.

Speaker A: I'd say I'd be looking for a pot of that size. Between half a million and £750. Yeah. Pounds, yeah.

Speaker B: In terms of profit?

Speaker A: Uh, well, well, no.

Speaker B: Was that in terms of revenue?

Speaker A: Okay, let me, let me cut back on ebitda. Let's just, let's just see on ebitda. So a company of a part of that size, if you've got the right level of fee, you're going to, if you're doing it at seven grand fee, it's never going to happen. But if you've got the right level of fee and everybody's working at full rate and they're all supported, you should be doing an ebit of between 4 and 5 million on that. I think if that's perm, because you're going to look at a conversion rate of about 60% of fees into EBIT, roughly. And I would imagine they should be doing close on a million pound in fees. Finger in the air.

Speaker B: Right, so 60% of profit on a million.

Speaker A: That's the highest I've ever seen it. Apparently there are people that do more than 60%, but they tend to be very small businesses.

Speaker B: Yeah, they're really small, I'd say.

Speaker A: But yeah, yeah, I've not seen that myself.

Speaker B: I think if you're getting above 40 to 50%, you've got a very, very good business. Even 30%. A lot of recruitment companies I speak to making, uh, less than 10.

Speaker A: No, no, because, because they're growing the business before they've made it productive. Yeah, it's madness because you're baking in a lack of productivity. No, get, get it to the stage, take your time. Get it to the stage where it needs to be, then go again. Because businesses grow, you should never hire more than 10% of your existing workforce in any 13 month period. Right. Because what happens is when you hire someone, your productivity drops obviously because you're picking up costs and they're not contributing yet. That's fair enough. That's okay. So what we want to do is a make sure we've made the right hire as soon as we can. And if we haven't, then they need to go. And if we have got the right hire, we need to get them to a minimum level of productivity before we go again on the next tranche of hires. What you shouldn't do is just hire people willy nilly and have a, you know, a three day onboarding process which is nowhere near long enough and hope for the best. That makes no sense, does it really? Make sure you've got the right person, they fit in the team, they're productive, profit levels back up, go again and then you'll be fine. You'll never turn into a scissor company if you do that.

Speaker B: So you've worked with lots of these businesses who've booked. If they're buying in with you, they're buying into the PLW mostly, not entirely. What percentage actually get there? Uh, roughly what percentage actually make it and what stops the ones that.

Speaker A: It's a scale, Sean, it's a scale. It's not binary at all. So. And half the time in reality, people don't want to let go of certain things because they like them. They know that they should, but they keep them because they like them. Well, you're never going to get up to maximum productivity if you're doing something that's somebody who gets paid less could do equally well. You've got to move everything down to the lowest possible pay grade, you know, without sacrificing quality and performance. And so they don't want to do that, which is fine. It's your company, you do what you want to do. But I think that if the question was how many people could reach that provided certain boxes were ticked around fee, size and niche. If you're trying to do everything with everybody on low margins, you ain't going to be working with us, I'll tell you that. So. So I think provided you're in the right space, anyone can achieve it. It's not difficult to do because it is behaviors.

Speaker B: And I always find with my clients it's people saying they want one thing but behaving a different against like the other behavior shows they don't or they're going a different direction.

Speaker A: So you must have had this, Sean. So you say, well you know, hey, you need to do this this and this. Oh, I don't think that'll work for us. And you know it will because it's worked for everyone else. It's just that they don't want to do it. They don't want the implications of that decision, whatever that might be. And so we get that quite a bit. So we tend, I mean, I wish I could just hand on heart, say, oh, yeah, like everyone we deal with ends up like that. Nah, I'd be lying if I said that. What we try and do is leave people better when we leave them than when we started making more money and not being quite as stressed out. I mean, I've got clients that stretch about pre Covid that we've kept because they are getting better at the rate that they want to get better at. And that's great. But others, you know, you're in, you do your business and you leave. Uh, but it's important as an owner though, not to take your eye off what you want from this business. That's the message I'd like to get across today is if you own a business, how much money do you want to make, how much free time do you want? What's the job satisfaction and how much you need to invest this year to reach the magic number, which you should

Speaker B: know, and I think the magic number as well, when you elongate the time frame. If you say I've got to do it in five years, it's a different pressure. If you say 20 years, then it's actually not that big a problem. Like it's really doable.

Speaker A: Yeah. If I'd have been prepared, I could bring the table up for people to see. But if you look at the table, it's ludicrous how it comes down the longer you invest in it. It's like mad, you know, down to as low as sort of 15, 20 grand for people who've got quite a way to work in their business, you know. So what about.

Speaker B: I want to talk to you about like the real stuff as a, as the life of a, of a person who's run businesses for 30 odd years. Right. You're at a point in life that uh, is beyond me and probably a lot of the listeners.

Speaker A: Right.

Speaker B: You, you've, you're a father, you're a husband, I believe you're a grandfather.

Speaker A: I am indeed, yes.

Speaker B: Yeah. And I've met your family. Testament to you. I think they're incredible people.

Speaker A: So testament to my wife, Sean. Testament.

Speaker B: Testament to your wife for sure. But you guys, as a, as I was, I was Actually talking to your kids at the team event about. You had the house where all, all of their friends wanted to be.

Speaker A: Oh yeah. That room over there is the games room. Yeah.

Speaker B: But they said like, even when they, you know, they'd be like, we haven't seen your mum and dad for a while. Can we, can we, can we get them out?

Speaker A: I get m invited to their weddings and everything. I love it. Really? Yeah, yeah, yeah. I love all that stuff because when I went through my weird period in the. In the midnight early to mid-90s when I was working all the time and not, you know, it's all going to be jammed tomorrow, but I came through that. I went the opposite direction then. So it's all about the family. Come on. And, and I like. I always like younger people because their ideas and their. And they used to come here and argue politics with me. I would often take the opposite political view that they had specifically to argue with them. Right. It's great. Loved all that stuff. But I think it's about. My dad said this to me and he wasn't a particularly wise man, bless him, but he said we. I was talking about work, life, balance. He says, no, no, don't look at it as work and not work. Look at it as things you like doing and things you don't like doing. So. And then do more of the things you like doing, whether it's work or not work, and do less of the things that you don't like doing, whether it's work or not work. And I've always tried to live to that part of. With the family and now with my grandchildren as well. I still need to work. Still can't give up. I can't let it go. Right. But there's more to it. So when I'm finished here, uh, Mrs. Ames and I are going to go and play golf together. Just have nine holes. The golf course where I live. Yeah. So she, she's a better golfer than I am. But, but. And it's. It's an integration of work and home and everything. It's just part of your life. And I've learned that over the years when I used to demarcate very, very much between the two. And we still have. I don't sit watching TV on my laptop or. I don't do that.

Speaker B: No, I'm not that guy.

Speaker A: That's not me. I mean, it has been in the past for sure, but not now. But, But I think that you. Once you realize that business is there to serve you and not the other way around. I think you're beginning to change in the right way then. And you can end up wherever you want to end up. You can take that business wherever you want. But if you're driven by ego, so you want more employees and the guy down the road or bigger turnover than whatever, I just think you're opening yourself up to all sorts of unpleasantness if you go down that route. Doesn't.

Speaker B: What, what would you say then to that 30 year old or 40 year old who's listening, who's like, they're unsure, you know, they, they know, I guess the symptoms are. They know, they're unsure about where they're going. They probably know they're not giving the best at home. They might have a young family that they're, they're not seeing enough of because they think they're building something for them. So, you know, I'm out early and I'm back late and I get so many people say, yeah, I see my kids on the weekend, but I'm, um, Monday, Friday I'm out and I'm building it for them. And I'm like, but the kids are not gonna, they're only gonna be sub 10 once and you're missing it. And I'm like, so what, Looking back now, uh, with, with all you've been through, what would you say to those?

Speaker A: I will, I will answer that question. But let me say this. I'm having to live a lot of my life through my grandchildren because I missed my children. Don't be that guy.

Speaker B: Right?

Speaker A: Don't be that guy. You might think you're doing it for them, but they don't care about that. They don't care about the money, they don't care about going to private schools, any of that. They care about you having time with you, unstructured time with you. That's what they care about. And you're not giving it to them. Now, I understand for a period of time there's a 3, 4, 8 rule with, um. 3, 48 rule with recruitment companies. Takes three years to establish a viable business. In that period, make all the sacrifices you need to make, do whatever it needs to be another four years to make a business that doesn't need you all the time, that's high profit. And eight years on top of that to make yourself independently wealthy. Now is that 15 years set in stone? Of course it isn't. There's a whole bunch of variables. But what I'm saying is the first three years is about right. At the end of that point, you should have moved from Being an owner of a business who works does everything they need to do to an employee of a business. So you're like an employee, you go to it, you clock on, you do you work, come home again. You can do that in three years if you're determined. What you can't do is just have it open ended. I'll just try and do more this year than last year. No, I specifically need this much this year. I'm going to make that. I need this time with my family. So Kirsty, I was talking to Kirsty earlier, she was saying that, um, she wants me to go on her podcast and talk about one thing and I'm going to talk about taking holidays. Because a coach I had back in the 90s made me every December buy one of those year planners, you know, those years sticking on the wall and get a color green and a color red. The color green was holiday and I had to stick the stickers in December for the whole of next year. Not book the holidays. But that's the time I'm gonna take. And the book, the red was the days I was gonna work on the business. I had to put those on so many a month. Right. Uh, you can move them around, that's fine. But that's Sankrosac. That's the, that's the deal. And I think you make that deal with your family and it gets better every year. More holiday every year, more free time every year, more working on the business every year. But whatever it is, make that deal, make it public and stick to it. Because I think you'll do better if you do that.

Speaker B: Yeah, I love talking to you because you are literally, you're just further down the path of what I'm trying to build.

Speaker A: You'll get there, Sean. I've no doubt about that.

Speaker B: Yeah, I'm confident. But I believe everything you're saying is resonating because this is where I'm going. Like, like it's what I think about, it's what I care about. Like my little 2 year old today I went swimming with her at 10 o' clock and you know, my parents were there, uh, they came up and watched. We then had lunch together. Then we spent an hour doing something. I came back, I'm doing this and then when I'm done with this, I'm going back to cook dinner and do the bath time and all the rest of it. Kick a ball with my steps on. There's so much to do every day and it, you know, I try and I built a bit. I'm nine years into this business, I'm not where I was, but I luckily started it before. Before I had all these responsibilities. I was 30 years old and I ran like a lunatic for three, four, five years and I did. But I think three years, it's actually really. I never looked at those numbers, but I think three years to the pandemic was just an absolute sprint of figuring out and doing anything I could.

Speaker A: And then pandemic vary. But the message is don't see that as open ended. What you don't want to be is having that three years extended to seven years or six years. You don't want that really. It's not good. Right. And it means about hiring the right people and delegating properly or outsourcing, if that's your. You can, you can outsource these days, obviously very easily, but it means getting rid of the stuff that somebody else can do. Gets paid less than you but can do equally well over time. That's the deal. That's what you need to do. And then lift your profits. There's lots of ways you can lift profits. The most important thing to remember business is every year is to think about ways. Be obsessed with ways that you can lift your revenues but keep your cost base the same because 80% of that additional revenue goes straight to the bottom line. The 20% is probably commission. And if you direct cost and things. But, but that is, that is the obsession. Don't think about growth is hiring more people because that is going to impact the profitability negatively usually. How can I make more revenue? Keep the cost base the same. Because then you're in the game of massively boosting the profitability, which is where you want to be. And that's something we preach all the time with our clients. That's what we talk about a lot. We think about. We make sure that we've squeezed every ounce of profit out of the team that we have. And then we go again, let's get someone else in.

Speaker B: When it comes to like, I've only got a few more minutes. But you know, you've got your own kids working in your business, right?

Speaker A: Yes.

Speaker B: What you know, is that a sense of pride? Is it complicated? Like what, what's going on there?

Speaker A: Well, uh, very briefly, Kirsty was between jobs, so she came to us. Melanie said, well get Kirsty in to do. We've got some things we needed doing. You know, Kirsty came and uh, I think that was about 12 years ago or something and here she still is. And then I wanted to be stronger in our product side of the business. And Peter had got some experience of that from his previous life and he was looking for a change in his life as well. I think, like you, heading towards more of family centered role. He was a corporate man at the time. Just kind of difficult really. So he came into the business. Um, and then we have Melanie and we have Rakshita and that's the perfect size for us. We can do more with the team that we have. We're having to change now like everybody else is because our market's changing and we need to be aware of that. I've spent a lot of time standing up the tallest tree in the forest and looking around because now's the time to do that, so. And I've always wanted a family business though. I've, um, always wanted that going back to that. That man that came from Eastern Europe and set up a jewelers in Birmingham, you know, and built his business from that with his family. I just, just liked it really. M. And I, uh, still like it now. It's great fun.

Speaker B: Is there a challenge to it, though?

Speaker A: Mrs. Ames gets a little cheesed off because if we're having dinner together, which we do occasionally, uh, you know, often, often they start talking about work or I start talking about work. Mrs. Ames has got that look and so we have to stop. And, um, quite often as well, you know what it's like. If you've ever worked with a friend, sometimes there's conversations that need to be had that it would be easy to have if they weren't your friend.

Speaker B: Yeah, my business partner is my best mate.

Speaker A: Ah.

Speaker B: I would also say it does change your friendship a bit. Like there's times where we forget we're best mates. Like, we just. Business you become. Work becomes every conversation.

Speaker A: And like, yeah, you've got to find

Speaker B: space to talk about. I mean, it might be different with family, but with me and him, we don't live in the same place. We see each other quarterly, maybe in person. We speak every day. You can. We have to, like. I think we've had to work hard over the last couple years to bring that back and remember we are mates.

Speaker A: My first. One of my first business partners was a friend. We'd worked together in the 80s together and we'd been, you know, we go on holiday and do various things together. When we became business partners, neither of us agreed this, but that became secondary. We didn't. We weren't as friendly then. We're friendly but not friends. Right. When the business was sold, we Went back to being friends again. And I still see him every year a couple of times, you know, and his wife. And so we've all moved on a little bit since then. But, but I think it's difficult with, with your children. You can't do that, obviously. It's like, well, I know you're my son, uh, but you're not going to be my son for the next 10 years. After that you can be again. That's not going to fly. So. No, no, no. So you do have to be balanced about it sometimes. But I, I'm an old boomer, see, 1960s. So I can just say, look, I need to just tell you this, right? And then I say it and move on. I've said it now, we've agreed what needs to be done. I move on. I don't get emotional about it. And I think that's the only way to do it. Same with friends, isn't it really? You would do the same with your partner if you needed to. You would say what needed to be said and you would move on.

Speaker B: Mike, I, uh, I'm gonna say thank you. You've, uh, I love, like I said, I mean it. I love spending time, I love listening to you. You've got, you've gotten a way of explaining things that uh, there's incredible clarity with, with experience and it's relatable, I think so. Relatable to people in my shoes, in my age range and, you know, the people we both work with. So I'm not surprised how successful you've been in what you do. I would love to get, you know, a follow up. I think we should have a follow up on this in a, in a, in a period of time and just see where the market is and you know, what, what we both see.

Speaker A: Um, but I think next time we should do it, live in the same room together. That's what I do it, do it. I think because I, I like, I like, I'm not going to be mutual smoke blowing a pass scenario. But you're going to be good. You're gonna, this is gonna work out for you. Got a great product, a great company, a great lifestyle. It's going to be okay for you. I think so.

Speaker B: I think so. Look, if anyone wants to reach out to you, I'd assume LinkedIn is a good spot. I'm going to tag you on everything LinkedIn. And even if they just want to put your brains on what profit lifestyle

Speaker A: wealth means, we do a lot of free stuff. We do a lot of, we have our show, obviously, every twice a month, we do a lot of work which we don't charge for. We just want people that this is for them to come to us. And the best way to do that is to explain what it is really. So we do a load of that stuff, which you'll see on LinkedIn if you're connected with me. Wicked.

Speaker B: All right, well, look, I want you to get back to playing golf tonight and have fun, and, uh, we'll see you very soon.

Speaker A: Okay? Thank you very much. It's been an absolute pleasure.

Speaker B: Thanks again for listening to today's episode of the RAG podcast. If you haven't already, please do subscribe wherever you listen to this show, as the more subscribers we get, the more people will listen and the more recruitment owners we can help. As a recruitment founder, you must know that things are changing. AI is everywhere, cold outreach is getting harder, and job boards, well, they're not what they used to be. But personally, despite the negativity, I believe the future is the greatest opportunity of our lifetime in recruitment. Because for the first time ever, a founder, uh, with five recruiters with a clear niche and the right systems can build the kind of influence, reach and profitability that used to take 500 recruiters and a global office network. The agencies that are winning right now aren't necessarily the biggest, but they are the most visible, the most trusted, and the ones building inbound demand. At Hoxo, we're working with clients who are running multiple six and seven figures in net profit, outperforming the negative noise and headlines. So to explain what these guys are doing, I've created a brand new free masterclass video for RAG listeners. In this video, it's less than 10 minutes long. I'm going to show you what these businesses are doing differently from the rest. So the link's in the description, fill in the form, watch the video, and see exactly how this system that these clients are using could work for your agency. Good luck.