Rob Ripp, Founder of Fintelligent, shares how he transformed his firm into a weekly-billed subscription business — and why it’s not a retainer, but a true recurring revenue model. The shift unlocked consistent cash flow, greater scalability, and better team leverage, all while improving client service. In this session, Rob walks through exactly how he made the transition from pricing to positioning to process and what he’d do differently. If you’re looking to scale your firm with more predictability and profit, this conversation will show you what’s possible.
TRANSCRIPT
Greg Alexander: Hey, everybody! This is Greg Alexander. You’re listening to the Pro Serv podcast. Brought to you by Collective 54. If you’re new to this show. We are focused on helping founders of boutique professional services firms make more money, make scaling easy and make an exit achievable. And today we’re going to talk about building recurring revenue into an expertise-based business. Many services firms are project-based, and there’s nothing wrong with that. But it’s more difficult to scale a project-based firm than it is a recurring revenue firm. And we hope to share with you a success story today on a founder who leads a services firm, who was once a project-based firm, who no longer is, has built a recurring revenue model. His name is Rob Ripp, and he is the founder of Fintelligent. So, Rob, it’s good to see you. Please introduce yourself to the audience.
Rob Ripp: Thank you, Greg. Thank you for having me. So. I’m Rob Ripp, the founder and president of Fintelligent, and we provide entrepreneurs a fractional full stack financial department. We’re rabbit hunters. And so our customers are typically entrepreneurs who are emerging from the growth stage to the scale stage. While we can do anything that a financial department can do, our focus is analytics. We help business owners grow their EBITDA and their enterprise value.
Greg Alexander: Okay, sounds great. So, Rob, I’m just gonna throw you a softball right out of the shoot here just to set the stage. So you were once project-based. You’re now recurring revenue. So tell us what happened.
Rob Ripp: So the project-based and time materials thing, especially in the accounting space, is a grind, and it started with a question I asked myself: what if I could sell services like software? And to do that I had to do three things. First, I had to do some research. I said, what is it that I like about the software business that maybe we could do? I knew it was task-specific, like, I wouldn’t launch QuickBooks Online to host a video conference, for example, and they had standardization, customizations, things like that. And of course, the business model of predictable cash flow. Second thing, I had to prototype. Could I reconfigure what we were offering our customers into something that lent itself well to being recurring revenue? And for that, the key thing is trainable, repeatable processes. So we looked across our work breakdown structures and tried to identify where we were doing those things and how they would add value to our customers. Final thing, we had to validate. This involved two things: we talked to our customers, got them involved very early in that process, and said, this is what we’re thinking of doing—what do you think? And the other thing we had to do was look at our competitors and substitute products because we had to make our offering differentiated, but not get so far ahead of the market that nobody would buy. And so when we had that together, we piloted, and we launched.
Greg Alexander: Now, everybody wants to do this, of course, and some people think it’s not doable, and they struggle with how they’re going to go to the current customers and take them off the old model and put them on the new model. So that’s my first question for you, which is: did you do this just with net new customers that came through the front door? Or did you go backwards and convert the old customers as well?
Rob Ripp: Well, we have great relationships with our customers. So we actually started with the people that we’re currently serving. And we’re talking to people that were both kind of on this project basis as well as the retainer type of thing. And they liked what they were hearing. So as we started developing our approach, we developed it with a very real world in mind. What was interesting was when we got to the pilot stage, we’d sort of formulated our product. I took it to one of the customers that we were doing some projects with. I said, what do you think? And he said, well, when can you start? And he bought it right there on the spot. I said, I think we’ve got something. So involving current customers and getting them involved in your own product development—I found they actually loved it. They felt like they were part of the process. They were really bought in.
Greg Alexander: Now, sometimes people think a retainer is recurring revenue, and I don’t believe that it is. I think it’s reoccurring revenue, but it’s not recurring revenue, and there’s some confusion around this. So you made it a point to explain to me that this is not a retainer. So tell us what it is, and how it’s different than a retainer.
Rob Ripp: So first of all, we offer subscriptions. We have customers—we don’t have clients—and we offer three base packages tied to accounting, analytics, and CFO, which is more advisory types of work. Within those bundles we offer specific sets of services, and we’re very clear about what we will do and what we won’t do. And then for each of those we allow customers to put on add-ons. So maybe somebody has deferred revenue, customer profitability, something like that. But the whole idea behind it is that we are very, very specific. This is our offering, and while we allow some customizations, if there’s any customizations beyond that we just won’t do it. And there’s also a lot of things we will not provide to people who are not subscribers, such as things like due diligence support. So it’s this notion, again, of getting back to trainable and repeatable. On the customer side, it’s: this is what you’re getting for this fixed price. This is what we’re going to do for you. And here’s how we’re going to do it.
Greg Alexander: So how is that different than a retainer.
Rob Ripp: Well, I think a retainer is more along the lines of, you know, I’ve got a monthly service. For example, there are people in my space that will say, for this retainer, you’re getting X number of hours, and we’ll do these things for you. And that’s not really a retainer to me. That’s a time materials kind of dressed up as a retainer. What we’re doing is we’re fixing that price, and we’re not putting any hours to it. Our customers don’t care whether we take 100 hours or 10 hours to get the work done. They’re looking for specific deliverables, specific support ways that we do things, and also access to our tech stack, which I think is pretty good, is a way to help them just get confidence in their numbers. That’s the thing they want most from us. Get me confident in my numbers.
Greg Alexander: Yeah. Now I’m gonna play devil’s advocate for a moment. When I hear this it seems rigid. It seems the opposite of client centric. And it doesn’t feel like a compelling value proposition from the client’s perspective. Like every time I call you, you’re gonna tell me it’s out of scope and hit me with another bill. So how did you overcome that?
Rob Ripp: Well, I think by being very clear in the sales process about what they do, what they want, and what they need from us. I’ll give you a very common example. We say no to an awful lot of prospects because we’re not a fit, because they’ll come in and they’ll say we want you to use our systems, or I’m in this industry, or I’m in these kinds of things. And one of the things we learned very early on is that if we niche down to a certain level and are very clear with our ideal customer profile, we think this offering will work for them because we developed this offering with those people. And so the challenge became finding the right people that were the right fit for us. And what we learned was that the things that they needed from us were the things that we were offering around giving them those insights. So it was standing meetings, it was financial reports, it was trends, it was other analytical kinds of things. And so with the ability to put a set of customizations around it—say, for example, you’re buying a computer, you want to get some extra memory—well, people will do that. But if they were to say, well, hey, I bought this computer, now I want you to do some spreadsheets on it, well, that would be out of scope. And so I think setting the expectations upfront with the customers, focusing on the ICP, and being very focused on that niche that we developed with them has been working for us very well.
Greg Alexander: Unique thing about what you’re doing is that you’re billing weekly. Most subscriptions are either annual, which you require a client to pay upfront, which I always hate, but that’s—
Rob Ripp: Yes.
Greg Alexander: —in case. Or it’s monthly. So why are you billing weekly?
Rob Ripp: Well, it’s interesting. We actually got that idea from a competitor, and when I heard about it at first I thought it was crazy. But if there’s one thing that our market loves—you know, these founders of these kind of late growth stage companies—it’s that they want flexibility. And we said, listen. It’s a weekly subscription. We’re doing work for you every week, and if you need more from us, you can slide it up and down. So if you needed, say, a virtual CFO for a few weeks to do something, we can do that. Likewise, if you had wanted to start a project with a CFO and then slide down to something, you have that flexibility as well. And we actually found out the clients love it. We’ve never had a problem with our weekly business model working against us. And from our perspective, we collect cash every Monday of every week through direct debit. So we have no accounts receivable. So we never worry about getting paid. And since we’re managing their financials, you know, we can disclose everything—they see what’s happening there, and the clients really seem to like it.
Greg Alexander: Interesting. So is it like an electric utility, where it goes up or down, or is it the same number every month?
Rob Ripp: Same number every month. And actually they can cancel with as little as 7 days’ notice. Like I said, we’re getting back into that flexibility type of thing. But we do not require people to pay a month upfront, and then we disappear for a while. And the annual contracts—I’m with you. I never really understood that. It’s truly a week-to-week type of contract, but our average customer has been with us now for 38 months. So we’re getting some pretty good retention.
Greg Alexander: You know it’s counterintuitive. You know, a lot of people that advocate for an annual subscription paid in advance, they make the claim that that increases retention.
Greg Alexander: And in my opinion it doesn’t, because under that model you have to go through the renewal cycle at the end of every year, which is like reselling the client. So they say to themselves, okay, so it’s renewal time. What did I really get in the last year? And they forget what the value is, and it’s a pain in the you know what? Whereas if you just go weekly, week to week, you actually have no renewal period. So there’s no need to resell a client.
Rob Ripp: And we are proving ourselves week in and week out, because ultimately we want to be part of that founder’s team, and we are. We sit at the table. Our most useful tool is the standing meeting. We offer weekly standing meetings for some of our packages, monthly standing meetings for others, but once we become part of that team, they don’t care if they’re paying weekly or not, because founders are getting the information they need. And I’ll give you an interesting example. We used to offer as part of our offerings a dashboard plugged into QuickBooks Online. It could give you all this stuff and nobody was using it. People weren’t even logging in. And so I asked one of our customers, how come you’re not doing that? They said, well, we’re just talking to you. You’ll tell us what we need to know. And that was it. And that was a very illuminating comment to me. They want to talk to somebody they know. Accounting and finance is not the strength of most founders, but if they have somebody who’s guiding them in this, who’s giving them those insights, and they’re comfortable—confidence in my numbers—well, that means the world to them.
Greg Alexander: How did you figure out what to charge.
Rob Ripp: We looked at the market and worked from there. We knew we wanted to be at or slightly premium to market, and we looked at the market on a monthly basis, then broke it down into weeks. But we never looked at it from a bottom-up basis, because bottom-up works for us. It doesn’t necessarily work for our customers. And so we wanted our price in a way where they felt that they were getting good value for their services, but we were never cheap. We would never win like a $500—we wouldn’t compete with, say, a $500/month bookkeeper. We’re much more premium-priced than that. But we also feel that we offer a premium product. It was always market-focused.
Greg Alexander: And you’ve mentioned to me that your staff utilization has gone up quite a bit under this new model. So what was it before? What is it now, and what caused the utilization rate to jump.
Rob Ripp: Well, I think we’re learning how to do more with less. And so really technology—and now, with the advent of AI, it’s gotten even more so. We were around sort of the fifties and sixties; we’re now in the seventies and eighties. And what we’re finding is that we’re treating AI as an employee. We’re actually naming it. We call it Fin. And we’re finding ways to integrate into our workflow because our number one key metric is monthly recurring revenue, and our number two is revenue per head. And the idea is that we want to grow both. And we’re going to always find ways to be more efficient at what we do, because remember, we’re fixed fee. The burden of profit falls on us. But likewise, if I’m offering value and I’m investing in that, I want to capture that additional margin. If I’m on time and materials, it’s variable cost—I never get that. If I innovate something and get more time out of the system, but can charge as much as I was charging before, all that goes in my pocket, and that’s where I want to be.
Greg Alexander: How has this made scaling easier.
Rob Ripp: Oh, it’s night and day, because what—and that’s our thing right now—is trying to figure out how to scale. And what it’s done is by standardizing things, it certainly makes it easier to onboard customers. We’ve been able to be more efficient at that, bringing on new people to help us out and getting them to scale up and understand how we’re working. But more importantly, by being focused on what we know we want to accomplish, then we know that we can target the right people in the marketplace. And it’s a huge marketplace. I mean, we deal with professional services providers—for example, 1.5 million of them. We deal with tech companies—I mean, millions of them. And if you look at the economics of a firm like mine: if I can have, let’s say, $50,000 in retainer and 100 clients, well, that’s $5 million a year in revenue. But 100 clients out of 1.5 million—that’s a market share you can’t even measure. So it doesn’t require a whole lot to get us where we need to be. The economics work for us. But the efficiency is what helps us drive our profitability.
Greg Alexander: And how do you stay disciplined to say no to prospects.
Rob Ripp: That was a hard-fought habit that I had to practice at, and I still—my staff still—every now and then somebody comes along and says, “you can’t do that.” We’re actually adopting more of a deal desk approach like you had recommended. After a while, when we started getting 20, 30, 40 people into the franchise, and I started to see the power of focus, it became very evident to me that this was the way to go. And I generally don’t have problems with discipline in my life—I mean, I’m in a discipline of accounting. But I did struggle with, you know, the revenue thing. And so there were things that we had to do around service delivery, profitability, changes to my lifestyle, and so forth and so on. Risk I was willing to take to get there. But I knew I wanted to be there, and I knew sometimes—I think the most valuable word in an entrepreneur’s vocabulary is the word “no.” So I use it.
Greg Alexander: Yeah, no to new prospects that don’t meet the ideal client profile. That’s no to existing customers that are asking for out-of-scope work. That’s no to employees who want to do something creative when you’re trying to work off of an SOP. The word “no” is a very powerful no in this situation.
Rob Ripp: Very much so, very much so. I mean, even we had to say no to legacy customers. They didn’t want to come on the ride. Now we got, I think, 80 or 90% conversion rate—I mean, a lot of people were on board. But remember, we involved them from the start, and the ones that we knew were going to be a problem we had those conversations with. I call it the breakup conversation, and they kind of sensed it, too. I mean, they knew what we were up to, but we were always good about having as good an offboarding experience as an onboarding experience. We referred to other people and kind of helped them with that. Because, you know, Greg, I do operate with the notion that we are not permanent. We are here to fix a specific problem—you know, help me get from 2 million to 15 million in revenue—hand me off. So we expect churn. We expect that we’re not going to be the incumbent. And so we’re okay proving ourselves all the time with a weekly subscription, because it keeps us sharp.
Greg Alexander: Was there a time in your entrepreneurial journey where you thought this wasn’t ever possible for you, that what you did was so customized and so bespoke that recurring revenue and standardized delivery and standardized ICP, etc.—did you ever think like, that’s crazy?
Rob Ripp: Well, I mean, I think for me the challenge was figuring it out on my own and taking forever to do it. I mean, look, I started my career in big companies. So the fact that I’m a business owner now—although a lifetime ambition—the fact that I actually took the chance and did it is a little bit amazing to me as I look back on it. But what I did do was I tried to allow myself to be very coachable and listen to anything that sounded like it would work. And so, you know, joining the Collective 54 Membership group, for example—there were so many tools and so many smart people that had these great ideas. I think that we got much better in the year and a half since doing that by just having that open-minded approach and getting there, than if we hadn’t. Because this journey that I’m on—I’m not on it alone. I mean, I need help, and I think the ability—I think moving away from some of these things and really kind of trying things very differently came from hearing and listening to other people and being open to what they were saying. You know, what worked better for them, and saying, well, why don’t we try this and see where it goes.
Greg Alexander: So what would you say to somebody—a peer of yours—a founder of a boutique service firm, who would like to do this, but they just don’t think they can? They think what they do is so unique—it’s a snowflake—that standardizing it and making it recurring revenue just doesn’t work for them. What would you say to them?
Rob Ripp: I think that there is the opportunity for recurring revenue in every business, and I’ll give you an example. There are people right now—they’re going to be listening to this podcast—that hunt elephants. They have Fortune 500 companies, big projects. And they’re like, listen, this is a no-brainer for Rob—it works for small companies, it’s finance, it lends itself well to recurring revenue. And I say, okay, but let’s take for a moment—you’re talking to a big customer, and you know you’re done after 18 months. You haven’t heard from them in a while. What if you had some recurring piece to that project afterwards that kept you in touch with that customer? I worked at a big company, and when we did a big project, what we would do is analyze it. Did it pay off for us or not? What if there was a recurring opportunity where you could do those kinds of things? It could be benchmarking, it could be proprietary data—which we’ve talked about before—and those kinds of things. I think there’s opportunities there for people to find it. The question is, why would you do that? And the answer is, especially with big companies, if there is a tail to your project, you’re the incumbent. That’s strategic. You’re an active vendor of theirs. And when they start looking for new business, they’re going to go to their active vendor base first, because they know them. And so to have a recurring piece to your business—it may never be your main business—but it’s going to give you opportunities, maybe to inside things that are not out for public bid. It’s going to get you closer to your customers. They’ll think of you when other opportunities arise. Could be opportunity for product development and things like that. I think it’s very, very strategic. And I think if people just talk to their customers and allow themselves to be coachable and open-minded about it, they’ll learn some great things.
Greg Alexander: Great advice, Rob. I want to compliment you. Boy, you’ve come a long way. Listening to you talk, you’re an advanced entrepreneur now. When you first started on this journey—and I say this with all admiration—I would classify you as a hobbyist, maybe a freelancer. You really know what you’re doing. I can’t help but see over your shoulder your book, Finance for Founders. You’re now a published author. I mean, you are kicking some serious ass. So congratulations, buddy. I really appreciate it.
Rob Ripp: Well, back at you, Greg. Couldn’t have done it without you and the great team at Collective 54. You guys have inspired me, given me great tools, and I’m looking forward to continuing the relationship.
Greg Alexander: Awesome. All right. So a couple of calls to action here. So if you’re a member of Collective 54 and you want to ask Rob questions about how he did what he did—go from project-based to recurring revenue—look for the meeting invitation. We’ll have a private Q&A session with him. If you’re not a member and happened to listen to this and want to become one, go to collective54.com, fill out an application, and we’ll get in contact with you. But until next time, we wish you all the best of luck as you try to grow, scale, and someday exit your firm.
Note: This transcript was generated by Zoom.