Finding the Sweet Spot: Determining the Right Size for Your Boutique Professional Service Firm

Finding the Sweet Spot: Determining the Right Size for Your Boutique Professional Service Firm

Dear Collective 54 Insights Subscribers,

In boutique professional service firms, there’s often a tug of war between those who chase relentless growth and those who prefer a more cautious, risk-averse approach. But finding the optimal size for your firm is essential for long-term success and personal fulfillment. In this article, we’ll explore the three critical factors that can help you determine the right size for your boutique professional service firm.

    1. Define Your Income Goal: Your income goal serves as the cornerstone for building your firm. Start by asking yourself, “How much money do I want to make?” This figure will enable you to reverse engineer your financial targets. Establish a profit target that aligns with your desired income and calculate the revenue required to meet that goal. Hint: “more” is never the correct answer. Put a dollar figure on the income goal.

For example, if your income goal is $500,000 per year and you aim for a 20% profit margin, your firm needs to generate $2.5 million in revenue. This simple equation allows you to define the size of your firm based on your income aspirations.

    1. Assess Your Workload Tolerance: Your firm’s size is intrinsically linked to how hard you’re willing to work. Consider the trade-off between the size of your firm and the amount of effort you’re willing to invest. A founder striving for a $100 million firm will undoubtedly work ten times harder than someone aiming for a $10 million firm. Hint: no one ever said on their death bed “I wish I spent more time at the office.”

For example, we all have the same 24 hours in a day, seven days in a week, and 52 weeks in a year. Reflect on how much of this precious time you’re willing to dedicate to work. Your desired workload will directly impact the scale and growth trajectory of your firm.

    1. Determine Your Impact: The size of your firm also influences the number of lives you can touch. Smaller firms typically have a limited client list and a smaller employee roster, which can limit their reach. Conversely, larger firms often serve a broader client base and employ more people, allowing for an opportunity to touch more lives.

For example, let’s compare my time as the founder of SBI and Collective 54. During my time at SBI, with a small client roster and a limited employee base, I touched a few lives intimately. However, at Collective 54, with hundreds of members in the community, I am making an outsized impact by touching many lives. While at SBI, I was driven by money, not impact, and my approach to sizing my firm reflected that. I purposedly chose a business model that had very few clients with each client contributing large profits. In contrast, today I am driven by touching as many people’s lives as I can, and therefore, my approach to sizing Collective 54 reflects this. I have chosen a business model based on lots of members with each member contributing small profits, just enough to invest in the community. I am optimizing for impact, not money. And this dictates the optimum size of Collective 54.  As you can, by comparing these two examples, the optimum size of your firm is determined by the goals of the Founder. You.

In conclusion, determining the right size for your boutique professional service firm is a strategic decision influenced by your income goals, your willingness to work, and the level of impact you wish to achieve. Finding the balance between these factors is crucial for your success and satisfaction as a founder.

If you’re ready to explore this further and join a community of like-minded founders who can support you on your journey, we invite you to apply for membership at Collective 54. Together, we can help you define and achieve the perfect size for your boutique professional service firm.

Don’t miss this opportunity to grow smarter, not just bigger. Apply to Collective 54 today and embark on a path towards a more fulfilling and prosperous future for you and your firm.

Episode 165 – Time Management: Strategies for Maximizing Employee Productivity in Boutique Professional Service Firms – Member Case by Benjamin Edwards

In this session, we delve into the science of time management and the art maximizing employee productivity within boutique professional service firms. From strategic time management techniques to fostering a culture of efficiency, we explore actionable strategies to ensure every hour counts. Discover how to optimize resources, streamline processes, and empower employees to thrive, ultimately driving success for both individuals and the organization as a whole.


Greg Alexander [00:00:15] Hey, everybody, this is Greg Alexander. Welcome to the Pro Search podcast, brought to you by collective 54. On this episode, we’re going to talk about time management and time management in the context of employee productivity inside of a boutique professional services firm. And I got a special guest with us today is a member of collective 54. His name is Ben Edwards, and Ben is with a software company called Cmap that specializes in this very thing. So Ben, welcome to the show. Please introduce yourself to the audience. 

Benjamin Edwards [00:00:48] Hey, thank you very much for having me, Greg. And hello everybody. At C 54. It’s Greg said I’m Ben Edwards, I’m the VP of partnerships here at C Matt and I’ve got a dual role. I get to lead our go to market efforts with boutique consulting in North America and also run all of our partnership opportunities, including being in C 54. 

Greg Alexander [00:01:10] That. But. We hear from members all the time. Is their time starved?  I don’t have enough time to do this? I don’t have enough time to do that. And yet, on the same token, you know, when we look at the benchmarking data, the margins are sometimes where we would want them to be. And then the services business, our inventory is the hour, the billable hour, if you will. So from your perspective, what do you think kind of the basics of time management are in this in the context of what we’re talking about today? 

Benjamin Edwards [00:01:42] Well, you’re absolutely right to address that. But professional services firms people are both the biggest cost and source of revenue. Yet we still find a surprising number of businesses not tracking time. Maybe part of that is down to the fact they use a time tracking point solution, and adoption from the top down and to employee level isn’t particularly strong because there’s a perception that it’s a little bit big Brother Ray. Maybe it’s being used by the execs in the firm to sort of monitor. Performance where it isn’t necessarily the case actually like you address. There’s some benchmarking data in North America and didn’t hear me. I’d suggest those firms that keep a tight hold on time management are more likely to have stronger gross margin, better utilization rates, and be in the growth cohort. 

Greg Alexander [00:02:38] Yeah. So when you’re working with clients of yours to implement time tracking, first off, what is the kind of trigger event that gets them to finally do it. And then when they go to implement it, what are the 2 or 3 things, the obstacles that are standing in the way? What you know, what can we learn from the previous implementations to help our members avoid some common mistakes? 

Benjamin Edwards [00:03:07] Yeah, I think typically they would start to look at time tracking actually, after they’ve used a time tracking point solution on its own and not seeing a huge amount of value from it, unless obviously they do purely chain and work, in which case it directly links to billing. But within C 54 you talk a lot about growth and scale and product ization and being able to repeat business. And presumably that’s fixed fee type engagements. So they come to us because they want to join the time keeping data point alongside financial information, project management information, combinations of pipeline and live engagements. So they feel they’ve realized that actually from a maturity perspective and a sort of growth scale and exit perspective, it’s imperative to connect all of those dots together in terms of some of the challenges that we see with it. The first thing to sort of point out is probably adoption. And actually, this is probably where the most interesting element is quasi 54 members, because you’re a consultancy and part of your skill set is. Delivering value to your clients and how you propose things to people is really important. It’s the same with your employees. How you position it inside your organization is going to be absolutely imperative to the adoption. If I may, I’ll give you a couple of examples. So I guess the starting point is firms who can tie in with KPIs. And that then might lead to a stronger margin, which you can then suggest your employees means that they can have greater growth opportunities inside that firm. They’re going to be part of an organization that’s growing and scaling. And if you want to take that even further, you can even incentivize it to a certain degree, i.e. profit sharing. The other angle from a selling it in perspective to employees that can overcome that adoption hurdle is making it about them. So utilization is a really key metric for any professional services firm. But often employees look at that and think that’s something not going to be judged by, you know, which can be true to a certain extent. But actually if you’re implementing time management, it can be really beneficial to the employee because you can track non billable time, which is how much time have they invested in learning and development. How much time are they doing spending on IP creation or progressing their own career. And you can track that. You can also make sure that people don’t get double booked. People don’t experience, so over being being over resourced onto engagements and then at risk of burnout. So it’s a lot of value that you can give to your employees when you’re actually implementing a solution like this. It really is about how you sell it. The second most important thing to making sure that actually it’s a successful initiative is connecting and with all the other key components of running your operation. So. Analyzing the information to make sure that it’s aligned with your product ization strategy. Tying it into the project financials so that you can make sure there’s no scope creep or delivery and it stays on time, stays on budget. And then you can reinvest that. Hopefully that’s useful. 

Greg Alexander [00:06:31] Yeah. Those are a couple of good, gotchas to watch out for. I particularly like how you sell it, and I think that makes a lot of sense. And showing how it’s to the benefit of the employee to do this. You know, for our listeners, you know, if you think about the challenge, especially with project based consulting firms, the challenge when you have limited forward visibility is matching revenue and expenses. You know, they’re constantly in the situation where they were. They fill the lake, drain the lake, fill the lake, drain the lake, you know, and they’re in there at times. They’ve got, you know, too many people sitting on the beach, so to speak. And then other times you’re running hot at 120% utilization, and they can’t figure out which way is up. And time tracking is a solution to that because you can see where the inventory is going, where all the time is going. And this better allows you to match revenue and expenses and get away from the boom bust cycle associated with project based consulting firms. Now, at what point been in your opinion? Is it appropriate for a firm to kind of move off of a unsophisticated, manual, spreadsheet driven approach to, you know, using a software tool to make this happen? 

Benjamin Edwards [00:07:44] Oh, really? We can split that down into two cohorts. There’s the first time founder an organization which typically adopts it later in the cycle, i.e. somewhere between 20 and 50 employees, depending on usually how much work they’ve got on and whether they can free up a resource to lead that type of project internally. And then there’s the second time founder, who knows absolutely that the operational guardrails that will lead to efficiencies right from the off. And they can embed practices from day one and they will adopt it sooner. 

Greg Alexander [00:08:20] So the person that’s been there and done that tends to adopt it sooner because they’ve seen the error in their ways and they and they know the value of it. Absolutely. You know, you talked about these time tracking systems, connecting with the other systems inside of a firm. So let’s let’s have a conversation around that. So first how does a time tracking tool connect to a CRM. 

Benjamin Edwards [00:08:42] Well, if it’s in a city like ours, an operations platform is part of the tech. So actually, it’s part of the solution that you’re you’re purchasing from a business like Sema. However, quite a few businesses, particularly in the North American market, have already got a CRM, namely Salesforce and HubSpot being the two. And in which case you just have an API based connection between your CRM and your PSC. It’s a two way connection, and that enables you to also do a number of things, so you can actually start resourcing and soft booking people onto pipeline opportunities. But. Okay. And that will help you avoid that boom bust scenario you talked about earlier because you got that forward looking visibility. Let’s talk about the banking finance system. 

Greg Alexander [00:09:33] So how does a time tracking system like yours connect into the financial system? 

Benjamin Edwards [00:09:38] For pure TNM based work, it’s imperative because what people record from a time sheet perspective goes on to the bill and sent to the client, and therefore that connects with your finance system. But I know in C 54 and we wholeheartedly agree moving away from that towards more fixed fee, including performance based, remuneration is still imperative to have that financial connectivity because you want to make sure that as the project is ongoing, you’ve got visibility on where that time that’s been spent by your team tracks against that initial budget, so that actually you’re not going to experience the scope creep that is so common in professional services firms. And often it’s really well-meaning, over delivery. But actually, as an owner founder, if you can instill that sort of clarity and confidence from PMS to address those challenges head on, either with the client or delivery team. That’s that’s margin that you can reinvest in the business for whatever you need. Yeah. 

Greg Alexander [00:10:45] The thing that I always got the most value out of was looking at. The financial information, which time is a component of at the individual product project level. Before the project was over. So a hypothetical example to illustrate my point. You know, let’s say that I’m in a six month project and it’s a fixed fee and the client is agreed to milestone based payments. So maybe they pay a third of the project at project kickoff, a third at the halfway point and the third at the end. It’s very common that we see this in the North American market. Well, in between those milestones, I’m trying to figure out, you know, am I going to turn a profit on this project or not? And that largely comes down to, you know, how accurate was my scoping when I submitted a proposal, and am I tracking to that original scope, or am I off scope quite a bit? And back when I had my boutique, it was very simple. We did a green, yellow, red, green was, you know, we’re on track. Yellow was, you know, we’re starting to see some problems, but it’s not a disaster. And red was, you know, what the heck happened? You know, we have massive scope creep. And if we don’t course correct, you know, early in the project we’re likely to lose money, which would then trigger us to go have a conversation with the client and point out point out the fact that, you know, they’re asking us to do things that weren’t originally scoped. You know, is that was that unique to my situation or it was is that a common use case and a common benefit that you see others realize? 

Benjamin Edwards [00:12:16] Yeah, really come in. And the other one to add to that is having a view in your progress page website, connecting time at a project level against your invoicing so that you know, you can make sure that you’re not. Spending a huge amount of time on a client work that maybe hasn’t been fully invoiced yet, and you need to catch that up. Or the reverse is true where you’ve invoiced a hell of a lot upfront, but actually you haven’t spent a huge amount of delivery time on it, and therefore it’s going to catch you up at some point. So that’s another keenly viewed report in our system, I would say. 

Greg Alexander [00:12:52] Yeah. And for those that aren’t familiar with that, whip is work in progress. So Project Whip is work in progress. That’s some, some industry slang there. I just wanted to clear up, you know, we we then collected $0.54. It’s professional services. Of course, you have the consulting shops and they get the term whip, but others like maybe, marketing agencies and architectural firms and things of that nature may not, may not understand that terminology, but we all should understand that terminology because it’s, it’s relevant across the segments. 

Benjamin Edwards [00:13:21] Yeah, absolutely. So we service businesses across professional services. And what’s always interesting just to know is the differences in the overall strategy, but also the KPIs and the margins and the growth of boutique consultancies versus agencies versus AEC versus life sciences. And there are little intricacies and sort of common stumbling blocks that are pertinent to each of those different industries. 

Greg Alexander [00:13:48] Yeah. We try to keep these podcast short to about 15 minutes, and we’re at the window right here. But then on behalf of the membership, we certainly appreciate you coming on and sharing your wisdom with us. We, we’re looking forward to the associated role model session, which, for those that are not members that are listening to this every week at inside of collective 54, we’ll have a Friday role model session, and Ben will be the featured role model. And one week. And that’s a private one hour Q&A session where members will be given an opportunity to ask their questions to Ben directly as it relates to and improving employee productivity through time tracking. So a couple of calls to action to the audience. So if you remember it, look for the meeting invitation for Ben’s upcoming weekly role model session and attend that so you can ask your questions directly. If you’re not a member and you think you might want to become one to learn from people like Ben, go to collective and fill out an application and we’ll get in contact with you. And if you’re not ready for either of those two things and just want to learn more, I point you to my book. It’s called The Boutique How to Start, scale and Sell a professional services Firm, and you can find that on Amazon. But Ben, it was good to see you. Look forward to your session on Friday. And thanks for being here. 

Benjamin Edwards [00:14:57] Thanks, Greg. Look forward to it. And to bring you questions, bring you scenarios. We’ll try and. 

Greg Alexander [00:15:03] All right. Sounds great okay. Thanks again everybody. Until next time I wish you the best of luck as you try to grow, scale and exit your firm.

The Top 20 Exit Options for a Boutique Professional Service Firm

The Top 20 Exit Options for a Boutique Professional Service Firm

As a founder of a boutique professional service firm, navigating the exit landscape can be a daunting yet pivotal decision. There are a lot more options available to you than you may realize. To assist you, we’ve compiled a comprehensive list of the top 20 most selected exit options. Each option is defined with its pros and cons, providing you with a clear view of your potential paths.

      1. Strategic Sale
      • Definition: Selling your firm to another company that sees strategic value in its acquisition.
      • Pros: Maximizes value, provides quick liquidity.
      • Cons: Results in loss of control, potential cultural clashes.
      1. Financial Sale to a Private Equity Firm
      • Definition: Selling to a private equity firm that invests in companies to enhance their value.
      • Pros: Capital injection, operational expertise.
      • Cons: Focus on short-term returns, possible debt burden.
      1. Management Buyout (MBO)
      • Definition: The firm’s management team buys out the business.
      • Pros: Preserves firm culture, motivates employees.
      • Cons: Funding challenges, emotional complexity.
      1. Employee Stock Ownership Plan (ESOP)
      • Definition: Employees acquire stock, effectively becoming part-owners.
      • Pros: Employee incentives, tax advantages.
      • Cons: Complex setup, potential liquidity issues.
      1. Initial Public Offering (IPO)
      • Definition: Offering shares of your firm to the public in a new stock issuance.
      • Pros: Raises significant capital, elevates public profile.
      • Cons: Increased regulatory scrutiny, market risks.
      1. Recapitalization
      • Definition: Restructuring a company’s debt and equity mixture.
      • Pros: Allows partial liquidity, reduces debt.
      • Cons: Complex process, potential for equity dilution.
      1. Family Succession
      • Definition: Transferring ownership to a family member.
      • Pros: Preserves legacy, maintains culture.
      • Cons: Limited to family members, potential for family dynamics issues.
      1. Merger with a Similar Firm
      • Definition: Joining forces with a similar company to form a new entity.
      • Pros: Operational synergies, enhanced market position.
      • Cons: Integration challenges, diluted brand identity.
      1. Licensing or Franchising
      • Definition: Allowing others to operate under your brand for a fee.
      • Pros: New revenue streams, brand expansion.
      • Cons: Quality control issues, risks to brand reputation.
      1. Liquidation
      • Definition: Dissolving the firm and selling its assets.
      • Pros: Simplicity, immediate closure.
      • Cons: Typically lower returns, impacts on professional legacy.
      1. Joint Venture
      • Definition: Forming a new entity with another firm to pursue shared objectives.
      • Pros: Shared risk, access to new markets.
      • Cons: Shared control, partnership complexities.
      1. Spin-Off of a Division
      • Definition: Separating a part of the company into a new independent entity.
      • Pros: Focus on core business, potential capital raise.
      • Cons: Loss of synergies, operational challenges.
      1. Sale to a Competitor
      • Definition: Selling your firm to a competing company in the same industry.
      • Pros: Possibility of a premium offer, streamlined process.
      • Cons: Market consolidation concerns, cultural integration challenges.
      1. Sale to a Foreign Company
      • Definition: Selling your firm to a company based in another country.
      • Pros: Access to new markets, potential for higher valuation.
      • Cons: Regulatory hurdles, cultural and operational differences.
      1. Partial Sale to an Investor or Another Company
      • Definition: Selling a part of your firm to an investor or another business.
      • Pros: Retains some control, brings in new strategic perspectives.
      • Cons: Shared decision-making, complex valuation.
      1. Asset Sale
      • Definition: Selling individual assets of the firm such as intellectual property, client lists, or equipment, rather than the business entity as a whole.
      • Pros: Targeted liquidation of specific assets, potential for higher valuations on certain assets.
      • Cons: Could leave residual operational challenges, may not provide a complete exit from the business. 
      1. Passive Ownership
      • Definition: Retaining ownership but stepping back from daily management.
      • Pros: Continued income without daily responsibilities, legacy preservation.
      • Cons: Reduced control, dependency on the management team.
      1. Selling to an Industry Aggregator
      • Definition: Selling to a company that acquires businesses in the same industry.
      • Pros: Streamlined process, industry expertise.
      • Cons: Potential for undervaluation, loss of identity.
      1. Hybrid Exit
      • Definition: Combining various exit strategies to achieve desired goals.
      • Pros: Flexibility, maximized value.
      • Cons: Complexity, potential conflicting interests.
      1. Gradual Phase-Out
      • Definition: Slowly reducing involvement and ownership over time.
      • Pros: Smooth transition, reduced operational impact.
      • Cons: Extended timeframe, diminishing influence.

As a founder, it’s essential to weigh these options carefully, considering how each aligns with your personal and professional aspirations. The right exit strategy not only secures your financial future but also ensures the continued success and legacy of your firm.

Are you thinking about selling your firm one day? Do you wonder which of these options is best for you? Or, do you want to know what your firm is worth? These questions, and many others, are addressed by the membership of Collective 54. Consider joining by applying here.

Episode 162 – The Task Force: How a Consulting Firm, After 20 Years, Committed to Scaling by Investing in a Dedicated Task Force – Member Case by Andy Thompson

Attend this session to learn how it is never too late to get serious about converting a lifestyle firm into a scalable boutique. This session will discuss the use of a dedicated task force to make up for lost time and how it can restart the boutique lifecycle clock. You will learn the who, what, when, where, why, and how to invest in a dedicated task force inside a small service firm to get back on track.


Greg Alexander [00:00:10] Hello, everybody. This is Greg Alexander, the host of the ProServ podcast, brought to you by Collective 54, the first mastermind community dedicated to the unique needs of leaders of boutique professional services firms. Today on today’s episode, we’re going to discuss scaling a boutique processor firm. We’re going to talk with a member about a new initiative they’ve launched called the Scaling Task Force, which I can’t wait to hear. We’re going to kick around a few tools that they’re using and discuss how it’s going so far. And the purpose in doing so is to maybe give everybody that’s listening to an idea that, maybe a scaling task force might work for them, or at least pieces of it. And maybe that might help you accelerate the rate of scale and improve the probability of success. So we have two collective 54 people here with us, Andy Thompson and Jeff Weathers. They’re with a company called Notch Partners. And, why don’t I start with you, Andy, and if you wouldn’t mind introducing yourself and the firm, and then Jeff, I’ll ask you to do the same. 

Andrew Thompson [00:01:20] Sure. Greg. Thanks for having us. I co-founded Notch Partners in O2. We work for private equity funds. Our role is to help create transformative relationships between senior executives and our private equity clients. Our mission is to improve their financial returns through better access to deal flow, better analysis of investment opportunities, better value creation planning, and better corporate governance. So you can think of us as a high-end headhunter with a very strong deal focus and private equity focus. 

Greg Alexander [00:01:55] Okay. Sounds great. Jeff, how about you? 

Jeff Weathers [00:01:58] Yeah. So I’ve been with Notch, almost eight years now and have a background in investment banking. I lead our business in financial services team, which is one of the five industry verticals at notch. And I also lead our newly formed skill-building task force. 

Greg Alexander [00:02:16] Okay. Fantastic. All right. I’ll ask a question, and I’d love to get both of your answers on it, but and I’m going to start at, kind of 30,000ft, but maybe to give us some context. So so in Andy, I’ll start with you. So what prompted you to focus on scaling your firm at this stage? You mentioned you founded it in 2002. It’s 2024. Yeah. You’ve put a you put a lot of emphasis around scale right now. How come? 

Andrew Thompson [00:02:41] That’s right. I bought out my co-founder a year ago. It was a long time coming, and it freed me up to do a number of things with the business that I’d been hoping to do. For example, adding equity partners, Jeff being one of them. But I realized as soon as I had the freedom to do what I wanted to do, I realized that the old adage is true. It’s lonely at the top. If I were going to be able to transform the business, I needed some guidance. And I wasn’t ready to constitute a board of directors yet. I started to look into CEO peer groups when I, which I had never invested in. I looked at several of them, collected 54 was recommended. I was the only one that was, entirely focused on professional services companies. So I read your book boutique, and I immediately recognized that we had a host of scaling opportunities to pursue. I bought five more copies of the book. I gave them all to my senior team. I told them we were in the scaling phase. They probably looked at me like, what are you talking about? They didn’t know. Growth scale. Exit. Yeah. They said, you know, they were drinking from a fire hose. I said, we’re in a scaling phase. I want you to read that whole section of this book. And then and then I signed myself up for Collective 54 and got to work for the team. I defined scalability as creating processes that enable and facilitate profitable growth. For a more tangible illustration, I say it this way at the company level. I say if the world were suddenly to hand us a doubling of our business, meaning a doubling of our client base and a doubling of our staff, which of our processes would break and which would hold steady? The ones that would hold are scalable. The rest need work. 

Greg Alexander [00:04:33] I love that definition. That’s a great way to look at it. And and, Jeff, I’ll come to you with the next question, which is since you’ve been there for eight years, I’m sure you’ve been attempting to scale at least, maybe even without knowing that’s what you were doing or calling it that, I should say. What are the biggest challenges, Jeff, and from your perspective in scaling a small services firm? 

Jeff Weathers [00:04:56] Yeah. So one of the, the big ones I think that we need to think about or starting to think about is getting our colleagues really excited about change. Because when you’re scaling a business, you need everybody on board, and there’s a lot of apprehension when you say, hey, we’re going to make some changes to the company. So. What does that mean to for us? What did we need to do? So the first thing was communicate. So we we decided we need to explain what scalability was. To explain what the benefits would be to the firm, and even how it would improve our colleagues day to day work, how their lives are going to change as we put these processes in place. 

Greg Alexander [00:05:38] Yeah, it always does come back down to the individuals and them asking themselves the question like, what does this mean to me? Literally day to day? Like, how is my life going to change? That’s a great way to say it. So I’m pleased that the book is playing a role. And thank you for the kind words and that I put a lot of work into it. It’s rewarding to hear that you got something out of it. And I know that you’ve you’ve recently launched a scaling task force. So I’d love and Jeff, I understand that you’re the leader of that. So I’m going to direct this to you. I’d love for you to kind of tell us what the scaling task force is. Who’s a member of it? You know how it operates. Just kind of riff on this, a forming. 

Jeff Weathers [00:06:15] Sure. So the skill of the task force, simply stated, was designed to look inside the firm, look at all of the ways that we do business with our clients, look at internal processes, anything really, and say, how are we doing this, doing this? And is this scalable to big as the business grows? The skill-building task force, to start with, we’ve really been focused on the service delivery part. And that’s where we felt like we would have the most benefit at the beginning. So what we did is we actually took an employee who had been with us for for several years now, who’s who’s an outstanding worker. And we said, we want you to, to be a part of this and be full time. So I’m spending a lot of my time on the task force. She’s full-time on the task force. And then we took a representative number of employees from across the firm to act as as members, we meet on a weekly basis and evaluate, different processes where we’re trying to change and update and improve. And then we also actually, every week at the at the beginning of the week, talk to the firm about what are we doing, what should you all expect this week? Here are some changes that we, we think are going to come this month or two months from now. Again, trying to make sure that we’re indicating to the firm, so folks are comfortable with what’s happening. 

Greg Alexander [00:07:45] So, Andy, taking a high potential employee and dedicating that person full time, non-bailable, I’m assuming, to leading the task force. Boy, that’s quite a commitment. How did you get there? 

Andrew Thompson [00:08:01] So, Jeff, Jeff is absolutely one of our top and most experienced, players. And he’s about half-time on it. And then we have a very we have a high potential mid-level person full-time. In total we probably have over two FTE is a little over two FTEs out of 30. Look, I wish we had started this stuff years ago. I wish we were not playing doing some cleanup, but I. But it’s time we have some inefficiencies and missed opportunities that could have been capitalized on much sooner in our evolution. There’s no time like the present. We put ourselves, clearly on, in the scaling phase, but we feel like we’re late-stage scaling. There are a lot of things that, unbeknownst to us, it was, you know, covered in your book that we were doing. But when we started doing the math on what the yield impact could be of creating more scalable processes, it’s clear to me that this more than pays for itself in a in a pretty short order. So for me, it was it was not a hard decision. To me. 

Greg Alexander [00:09:14] Interesting. You know, when you express it like that, you know, two FTEs out of 30, it seems like a reasonable investment. But I was on your website and I was looking at some of the bios. I mean, you employ highly skilled people, even at the mid-level. And I’m, I’m guessing in my mind what you’re paying them. So from a dollars perspective, it’s a significant investment. So I just wanted to acknowledge and compliment you for, you know, being willing to make that kind of investment. 

Andrew Thompson [00:09:40] I’ll tell you this. We’re going to be watching closely, and tracking our results as closely as we can. We don’t have all of the gauges and dials that we need to know exactly the impact day to day. If we had all the time in the world, we would have built more dashboards and more insight before we even started. But we’re sort of we’re getting going, and we’re going to do our best to track the results because we’ve got to justify this expense for ourselves. Yeah. 

Greg Alexander [00:10:07] Now, Jeff, you mentioned that you started with service delivery. That’s interesting. You know, when I’ve talked to members attempting to scale and maybe less formally, I don’t know if they’re calling it a scalable task force. They usually start with sales. And the reason for that is because they want to be able to measure it. They want to see revenue coming in. And also the founder is usually trying to replace him or herself as the firm’s primary rainmaker. But you chose to start with service delivery instead of sales. Can you tell us a little bit about what went into that decision? 

Jeff Weathers [00:10:38] So we actually look through all 17 topics in section two of critique. And what we did is we said, okay, what’s the level of impact of each one? And what’s the time frame to achieve? Not surprising business development and pricing. We’re at the top of the list. We actually have been spending a lot of time on business development and pricing over well over a year now. Okay. So to answer your questions, they’re already they were already underway. Makes it makes sense. 

Greg Alexander [00:11:10] Makes a lot of sense. 

Jeff Weathers [00:11:10] Yep. So the next two that we looked at on that list are client experience and yield. And of course client experiences. You know, in looking how you support the individual client. Goal and yield is within the efficiency of how our teams can deliver high-impact service to to their clients. Those two, we decided were, all the other areas we had identified and we knew there were opportunities. We decided, look, these are by far the next two highest priority, probably behind business development and pricing. Got very. 

Andrew Thompson [00:11:43] Well. The reality there, Greg, is that the our our cost structure is built of service delivery. And we are we are the premium provider with premium pricing. With increasing competition, we need to be really conscious of our pricing to manage our gross margin. 

Greg Alexander [00:12:00] Yeah. Yeah. Well, I’m glad that you’re doing that. It’s sometimes people don’t focus on pricing enough, and it’s it’s a lever that we all have to pull, especially if you’re a premium provider. I mean, being intelligent about pricing is so important. So I love the fact and for those that are listening to this that might not have read the book yet. What they’re referring to is section two of the book is called the scale section. And there’s chapters in there. And they they use it as a menu, if you will, to choose the things and to come up with the priority list. And there’s a checklist at the end of every chapter that can help kind of eyeball whether or not this topic is of interest to you. So that’s a really good teaching for all of us, and maybe a way for those that want to start a similar task for us to get started. Jeff, any any, early results so far, is it or is it is it too early? Any even anecdotal stories that would suggest that you guys are off to a good start? 

Jeff Weathers [00:12:50] Yeah, it’s it’s definitely early in the process. So, you know, we’re hoping to see more results to come, but I think one of the first things that I noticed, is actually an openness from our employees, an openness for them to go out and find scalable opportunities because the task force we can identify, we can try to put processes in place, but we’re really going to rely on our employees to look at what they do on a daily basis and say, what can I do to scale the business? So there’s an openness and we’re excited about that. Second, we’re already even within a couple of months. There were some really. Easier. Easy target soon than I thought. They’re already putting processes in place. That are going to help us engage with our clients at a much higher value of service. Yet to be seen how much impact it has that we’re excited to to see those through. And then I would say, lastly, we came up with a whole list of efficiency of efficiencies. And what we have to do is rank that list and say, okay, where do we start and how do we attack it? And so we’re doing that and we’re ticking down and, and I think there’s plenty of opportunities there as well. So I’m excited about that. 

Greg Alexander [00:14:06] Yeah, I’m pleased to hear the employees are open to it. You know, that’s half the battle. Sometimes with any change, initiative is just getting people on board. So congrats on that. I guess guys, my last question is for both of you. And that is, you know, for those that are listening to this, members that are saying, Jesus, maybe it’s something that I should do. What, what words of encouragement would you give them or what would you tell them to stay away from? Like, were there any things that, surprised you, you know, as you designed and launched this new initiative? 

Andrew Thompson [00:14:37] You won’t be surprised. At one of the answers. The communication is so important. Just the word scaling that’s new to most people. Yield is new. We were approaching it with a level of transparency that was new. And so we’ve gone through yield analysis. What does scalability mean? At least two times both of those for the whole company. Pretty slowly and carefully. And it came from the top. So I was I was walking folks through that. We also, I would say while a task force can be incredibly effective and we’re already seeing some early returns, we look forward to keeping you abreast over the next couple of months. As I said to the team, in our in our annual state of the company, the task force is not going to hand you scalability. They may and you tools and and processes to help you scale, but the scalability happens with you. And so the message for the team and this is you’ll love this Greg. The theme for the year is practice scalability every day in every way. And so it is not something that can be isolated with two and a half FTEs and turned into a little project with announcements every week. It’s got to be something that’s a way of life across the company. 

Greg Alexander [00:16:00] Interesting. Jeff, anything that. 

Jeff Weathers [00:16:02] No, I’m just very excited about, you know, you you look at it and you say, look at all the opportunities we have. Look at how much growth we can find. So really excited to see what the results will be, right. 

Greg Alexander [00:16:15] You know, I would like to add something to this comment, and maybe this is a give back to Andy and Jeff for their generous, time today, when I had my firm and I was focused on scaling it, the two measures that we tracked more than any other. Or the cost to acquire a client. Was it going down and going up? And if we were scaling our business development efforts correctly, then we were. We are more efficient in how we acquired clients. That was no one. And then the second was the cost to serve a client. Was that? Was that staying at a minimum flat while revenue was increasing. So therefore we saw margin expansion or was it declining? The cost to serve a client was going down and price was staying the same. So also a margin expansion opportunity because we were more efficient in how we delivered the service. So I don’t know if those are on your scorecards, but I would encourage you both the kind of macro numbers, if you will, and there’s many sub metrics that lead into both of those numbers. But if you think about scalability, what really is it scalability in a services firm is this revenue is growing at a clip faster than headcount. In the end, that’s the essence of it. And if you can get revenue growing at a fast clip, maybe it’s growing at 25%, but head counsel and growing at 5%, then you’re scaling. If you if revenue is growing at 25% and headcount is growing at 25%, you’re really kind of running in place. I mean, you’re you’re not that’s you’re you have higher revenues, but you’re not necessarily earning more, creating more enterprise value for yourself. So just thought I would share that with you guys as a give back. And hopefully that’s helpful. 

Andrew Thompson [00:17:55] All right. Thank you. 

Greg Alexander [00:17:57] All right. Well Andy and Jeff it was great to have you both. We look forward to being a weekly role model with the member Q&A session. So thank you for that. And congratulations on your new initiative for having the courage to launch it. And I wish you the best of luck with it. 

Andrew Thompson [00:18:11] Thanks, Greg. 

Jeff Weathers [00:18:13] I. 

Greg Alexander [00:18:14] All right, everybody, that’s the end of, today’s episode. If you want to learn more, go to If you want to read about this book that we just discussed, you can find it on Amazon. Again, it’s called The Boutique How to start scale and sell a professional services firm. But until next time, I wish you the best of luck as you try to grow, scale, and exit your firm.

Bad Fit Clients: How to Avoid Costly Mistakes That Hinder Growth

Bad Fit Clients: How to Avoid Costly Mistakes That Hinder Growth

Play Video

It’s easy to view all revenue as good revenue, but if you take every opportunity that lands in front of you, you’re going to end up with an unfocused business and scarce resources. So how do you avoid this costly mistake?

This video highlights the importance of identifying your specialized niche, understanding your ideal client profile, and selecting the right projects for your firm.

Tune in for more on:

    • Creating clarity around your scope of expertise
    • How the allocation of 3 resources determines scalability
    • Why accepting the wrong opportunities can hinder growth
    • The detrimental impact of an unfocused ideal client profile

Episode 150 – Mastering the Pivot: Reframing Your Small Service Firm’s Value Proposition to Meet Your Clients’ Real Needs and Desires – Member Case by Tony Amador

This session outlines the crucial steps for a small service firm to reposition its value proposition based on actual client needs and desires. It discusses the importance of listening to client feedback, extracting actionable insights, and then applying them to refine the firm’s strengths and offerings.


Greg Alexander [00:00:10]  Hi, everyone. This is Greg Alexander, the host of the Pro Serve podcast, brought to you by Collective 54, the first mastermind community dedicated to founders of small service firms trying to grow scale and someday sell their firms. On this episode, we’re going to talk about pivoting your value proposition. This is something we often have to do as young emerging firms, and we’ve got a collective 54 member with us today. His name is Tony Amador. And Tony, it’s good to see you. I understand you got quite an experience with this particularly recent experience. And thanks for being here. And please properly introduce yourself to the audience. 

Tony Amador [00:00:55] Sounds great. Thanks, Greg. Yeah, great to be here. I’m Tony Amador and I am the co-founder and chief client officer of Proxy. And Proxy is an executive multiplier that helps small and medium sized business executives, gives them a strategic advisor with a breadth of business knowledge and repeatable processes to help them complete their goals, set initiatives and complete their goals to grow their business. 

Greg Alexander [00:01:24] Okay. Executive multipliers. So tell me what that means. 

Tony Amador [00:01:29] Yeah, it really is that we’re going to make that executive the best they can be. So we’re going to multiply them in terms of how many places they can be in one time and how much they can get completed, what they can get done. And so we’re multiplying the executive. We’re also multiplying the business. So we’re making the business better. So we’re process is better, growing the revenues, just making a better business. 

Greg Alexander [00:01:54] Okay. Got it. Makes sense. All right. So we’re going to talk today about pivoting the value proposition. So my team tells me that you recently did this and you’ve got quite a story to tell us. So why don’t I just have you fill the audience? And so what happened? 

Tony Amador [00:02:10] Yeah. So we started our business. We we tested it in 2019. As with the idea of being a chief of staff, that that that a client again could could hire to help them just be better, right? Grow their business, be better and give them another set of hands, if you will. And really, the value proposition that we had at the beginning was about a lack of time. We thought the problem we were solving was lack of time. And so we were going to give clients time back. So that was our value proposition is we know you’re busy, we know you can’t get everything accomplished that you want to get accomplished, and we’re going to help give you time back. And we’re going to do that with the chief of staff. And that chief of staff will do everything really from virtual assistant through, in some cases, all the way almost to a CEO. Right. Like really help find the right solutions for things, but everything in between. And so that’s where we got started. 

Greg Alexander [00:03:09] Okay. 

Tony Amador [00:03:10] Okay. And you both you. 

Greg Alexander [00:03:11] Pivoted away from that. 

Tony Amador [00:03:13] We have. And so, you know, in about two years in what we we realized a few things. And one that the problem we were solving, it wasn’t really lack of time. Right. That was a that’s an out shoot of hey, I don’t know which initiative to do. I need some help with the initiatives. I’m not sure where to start. I’m not sure what priority. And so what our chief of staff’s chiefs of staff were doing were those things all much more strategic and getting things done. And at the same time, we were being their virtual assistant or their executive assistant and but that the real value we were bringing was on that other side. So they really didn’t care as much about that time back Once you really got in there and we put someone with them that had a breadth of business knowledge and could really help assess what was going on, assess the people, assess the processes and and put improvements in place, better initiatives in place. So then it was really about that person and that and again, the client always only knew one person, but we used the team and so at the same time we’re in their email or we’re in their calendar. But some clients didn’t need that or some that, or we found that the client. And so then it’s like, Well, what about that? Or then there were clients where they really just need an executive assistant. So they hired us because they need an executive assistant and they went with, You’re going to solve my problem of lack of time. But they weren’t really in the place of Let me jump in with you and let’s work on initiatives. They just wanted that other piece, which was not that that’s not where our real value was from. And so what we realized was, one, we had super successful clients that didn’t even use that part of the service and two, the ones that did use it in a lot of cases were too focused on that. And so then again, as a team, while they didn’t know that person, one little thing that would happen in a calendar or an email would suddenly be a road bump that while we’re doing amazing things and strategy and initiatives and moving the business. And so then there’s they’re upset about something that wasn’t even really what we really wanted to do for them. Right. And make them better, make their business better. And so we started selling without the virtual assistant piece. And had no problems. And so then all of a sudden you realized, wait a minute, what we really are is an executive multiplier. We’re making them better. We’re giving them more chances. Again, we’re in meetings in their place. We’re in meetings with them. And so we’re very quickly able to go from that meeting to figure out where to go next. And we’re making and we’re growing businesses. And so we started selling without it started talking about an executive multiplier. And when we did that, we also created the chief of staff roundtable. And so we spun that off as a separate business because that’s not really what we are. And so then we landed where where we work today, and then we have a pivot from there that will that we can talk about if you want to. But that’s where we went. 

Greg Alexander [00:06:11] So before we move on to the second pivot, let’s stay on this first one for a moment. So that’s a big pivot. I mean, the the premise of the business when you launched was one thing and you learned it wasn’t that. It was it was something else. So so how did you execute this and get everybody on board and have the courage to make the change? 

Tony Amador [00:06:34] Yeah. I think, you know from the beginning what our real vision was, is that from, you know, two of our founders were sitting on advisory boards and where they would talk about ideas for founders and the founder would love it, and then they’d come back a month later, two months later, and they hadn’t done it yet. And so, again, the problem, they would say it was lack of time, but what they really needed was someone to help them with that initiative. Help. Here’s what it looks like. Here’s how it should happen. This one should go before that one. And so that’s what we were already doing. And so because we were already doing that and we have we’re we’re documenting all of our process. So you pull them off the shelf and you’re ready for the next client to do that same thing. The pivot from that perspective wasn’t terribly difficult for us internally because it’s what my team was already doing right? And then the people I had hired to do that role, that whether internally we call that and they implemented the. That’s funny. Yeah. So we might tell the client that this is your proxy or this is your integrator. Okay. Right. So internally we call it the integrator, but ultimately that’s what we were doing. The strategic advisor, this listener, a trusted advisor, a confidant, you know, all these things that a founder really needs and doesn’t necessarily have someone to talk to and that it’s not safe to talk to some people about things. But you could always talk to this person again, similar to a chief of staff, but but not connected to the administrative duties. And so where we were really successful was in that place. And so that part was an easy pivot. The harder part was, okay, are we going to really stop saying we’re a chief of staff or are we going to change our website or are we going to change the language we use? It was pretty easy, Greg, because, you know, we we’d early on decided it was small and medium business. We had all worked with big businesses and we were ready to work with founders that we could help them make a difference. Well, they don’t know what a chief of staff was, so we spent a lot of time explaining what a chief of staff was. And then some people really warmed on to it’s an executive assistant. It’s a high powered executive assistant, which, again, not what we wanted to be or what we were ever trying to be. And so that part was a little it was actually a little easier than we thought it might be. Yeah. And we went from there. 

Greg Alexander [00:08:55] So with this new understanding and congratulations to you guys for listening, you know, and not being married to the old idea and pivoting based on real, you know, receptivity in the marketplace. You made another pivot. So tell me about that. 

Tony Amador [00:09:12] Yeah. So what we realized probably about three years in was that, again, the work that we’re doing and what we believe in is have the best business you can have. And it will it will grow and it will be more valuable. And so then we started getting clients talking about exiting and what what does it look like when I exit and where am I there? And when we so we started doing a little bit of research around that and what was out there. And we found the Exit Planning Institute and their accreditation for a CPA, you know, certified exit planning advisor. And in doing some research, we realized that, again, what they talk about is have the best business you can have run everything the right way. Don’t have a founder bottleneck, right. Don’t use your words. But that’s the idea, right? Get the founder not to be the bottleneck. Get your process down, have the right people. Again, all the things we do already and they had a metric for that, a survey you could go through and get a score that they’ve connected to a multiple. And so we felt like and believe that if we so we a couple of us went got certified, learned all that and felt like if we took that survey and connected it to our strategic offerings and our standard operating procedures, that we could identify where the weaknesses were that were driving their multiple and we could start in a place and say, here’s your multiple today based on going through the survey. Again, similar to collect the 54 survey, Right. Go through that. Here’s your multiple today. Here’s the things we need to work on when we go do these things, the multiples going to go up, your score is going to go up, the multiples are going to go up. And now we’re a value multiplier, right? And so we’re using that really, again, as a very parallel to what we do. But talking instead of driving initiatives necessarily and growing your business, it’s about multiplying, you know, your value. And so as a value multiplier, that’s what we’ll launch. We’re working through that now and things are coming together very nicely and will launch that in 24. And the thought is that some clients will hire us as an executive multiplier. And in that case, you know, while we help determine what the right order is for the strategy and the initiatives that ultimately a client comes to us saying, I need to get these three things done and then I’ll work on number four. Number five, Yep. It come to us and you need a value multiplier. You’re three years out, two years out, five years out, whatever. We’re going to do the survey and then we’re going to direct. Here’s what needs to be worked on in this order to drive value. And so you might come to us an executive multiplier. You might come to us and need a value multiplier. You might have both at the same time. And we have clients like that that we can we can already see they have an executive multiplier. They think they’re three years out and they’re planning on next year saying, and let me add the value multiplier. So again, one person’s working on what the CEO thinks is important and another one’s working on what the market is going to see is important and will drive that business forward from there. 

Greg Alexander [00:12:04] Interesting question on the terminology. So when we kicked off, I had to have you explain to me what an executive multiplier is. And this is the problem with coming out with new language. And, you know, this is something I’ve lived myself quite a bit. Everybody understands chief of staff, everybody understands an executive assistant, but no one gets an exact multiplier. And now now you’re adding to that by saying. The value multiplier. So there’s two schools of thought here. One school of thought is, you know, use the current vocabulary and fall into an existing category and dominated. The other school of thought is to invent your own vocabulary, create a new category, and therefore, you know, be in a market of one. 

Tony Amador [00:12:49] Right. 

Greg Alexander [00:12:50] Obviously, you guys decided to invent your own vocabulary and try to create a category. Tell me about that decision. 

Tony Amador [00:12:57] Yeah, I think because what we found with small and medium business, that chief of staff wasn’t as easy as we thought it was, that everybody didn’t know what that was. So we came from working at agencies with, you know, Fortune 200 companies. And so our AT&T client had several chiefs of staff in our Frito-Lay. And, you know, all these clients we worked with had chiefs of staff. Everybody knew what that was. We got the small business and somebody with 40 employees, they didn’t know what that was. We spent a whole bunch of time explaining what a chief of staff was, and then they’d go, Yeah, I think I need that. But it might be that they needed the virtual assistant piece. They just really did need time back. And so they really just needed that if they needed the other piece. Well, great. We do that when we say executive multiplier and that we are going to be right there with you helping being with you to run your business. Again, we’re in the leadership meetings, executive team meetings, the whole staff meeting at different times. And we’re working with their staff to run initiatives. When we tell them we’re going to give you someone that knows what to do in what order and and has a way to do it, They get that. And so that part hasn’t been as difficult. And I think on value multiplier, I think since we got through that, we feel like if I tell you we’re going to help multiply the value of your business, I think that one will come maybe even easier than executive multiplied it. 

Greg Alexander [00:14:21] Yup. All right. Well, listen, this is a great little use case here. We try to keep these podcasts short. We were talking about pivoting value propositions. And Tony, just share with us how, you know, there young firm has gone through this now twice. And I think it’s a good learning for us. The big headline here to take away from it is make sure you’re listening to the customer, the client, and be willing to pivot and kind of throw away old work and start new work when when that is required, which is what Proxy has done so. Tony, thanks for being on the show. I look forward to our member Q&A and appreciate you being here today. 

Tony Amador [00:14:59] Thanks, Greg. Really appreciate it. 

Greg Alexander [00:15:01] All right. So a couple of calls to action for listeners. So if you’re a member, attend Tony’s Q&A session. Look for the invite on that. If you’re not a member, you want to be one, go to collective and fill out an application will appear. Or if you just want to learn more about the types of things that we talk about beyond today’s topic, check out my book, The Boutique How to Start Scale and Sell a professional services firm, which you can find on Amazon. But until next time, we wish you the best of luck as you try to grow a scale and exit your firm.

Episode 149 – Why Professional Service Firms Should Never Become SaaS Companies – Member Case by Nathan Kievman

Many professional service firms foolishly think the path to scalability is to become a software company. However, founders of service firms make more money than founders of software firms, generate more wealth for themselves at exit, and succeed much more often. In this session, we will help you avoid making the devastating mistake of trying to become a software company.


Greg Alexander [00:00:10] Hi, everyone. This is Greg Alexander, the host of the Pro Serve podcast. Brought to you by collective 54, the first community dedicated to the unique needs of thriving boutique professional services firms. On this episode, we have a very interesting topic. Today we’re going to talk about the problem of having too much cash. Most of us have the other problem, which is not having enough cash. But today we’ve got an interesting story to tell you. And I’m joined by a very well-liked, long tenured, well-respected member, Nate Caveman. Nate, it’s good to see you. Please introduce yourself to the audience. 

Nathan Kievman [00:00:58] Thanks, Greg. Great to be here, guys. My name is Nathan Kievman. Nate Kievman is what my friends call me. So please call me Nate. I’m the CEO of a company called the Link Strategies Group, and we are a 12 year firm that has been in the marketing and consulting space and helping organizations grow. Helping them schedule meetings and connect with their executives. They’re at their most ideal market. And in doing so, we’ve been obviously able to grow our own company and it’s been a fun journey over the past 12 years, sending over 86 million emails, setting up 100 over 100,000 meetings for our executives over the years, working with big firms like BlackRock and Nasdaq for the world that a single person browser company. So we’re great. We’re grateful to be here and thanks for inviting me. Okay. All right. 

Greg Alexander [00:01:48] Fantastic. So, Nate, I asked you to come on the show after you and I had a very interesting conversation and I would like you to tell the story of the problem that you had by having too much cash. 

Nathan Kievman [00:02:03] For sure. So I never expected this whole story and experience to happen in my whole life. But after the fact, Greg and I had some fun, fun, fun, fun conversations and some lessons to learn from it. But now you all get a benefit from my band. So basically towards the end of 2022, our firm was looking for ways to raise capital because, you know, in short, we had gone down a path as a as a services firm to build a technology and to do the technology piece require more capital. We had quite a few developers and so forth, and I’ll walk through with the learnings from that as well as part of this journey. But we had effectively between two sources with the SBA and a private lender, were able to finance $1.8 million that into our $3.4 million business. Right? And so the prior year we had 3.4 million in revenue as an organization and we raised those 1.8. And the purpose of the raise was to stand up the technology and to stand up a sales organization within our firm and really get that functioning and going. And so I moved over to the sales side of the house, focused mostly on that. Our CEO had handed the reins over to do a lot on the allocation of resources and so forth side of the House and working with our CFO to manage that. And I really, you know, quite honestly thought much of it, and I didn’t pay a whole lot of attention to the distribution of cash and the changes and team members and the increase in team and the increase in salaries and pay and so forth. And all of a sudden six months into it, the money was gone and we really didn’t have a whole lot to show for it. And I was like, Whoa, what just happened? And that’s like the start of the story. Greg, do you want to jump in here, too? I’m going to continue through on with what that what what happened from there? Well. 

Greg Alexander [00:04:01] So the spend 1.8 million bucks in six months is I mean, that’s crazy. So where did the money where did it go? 

Nathan Kievman [00:04:11] Well, yeah. You know, so. Where. When the big money came in, all of a sudden we went from two executives to five. That’s a big part of it. Our executive payroll became the next year. It was equal to the next year’s total revenue. The IPO taken off the ball of serving our clients. Our client retention went down by almost 50%. Our cost went up by 100%. And my next year was a total reverse of the year prior. Right. And it went in executive salaries. We went from a team of 30 to 50 now, and we were outsourced. So it wasn’t super expensive. Like you might think that’s a lot, but we were able to leverage that. But if the people that manage half that number of clients were so firm, right? Imagine 25 or 35 at any given time. I think we were up to 40 at that point, but still we didn’t need 50 people to manage that. Right. And so those are where most of the extra developers, couple extra executives, all of a sudden that money is flying out the door. Yep. 

Greg Alexander [00:05:18] Okay. So that that helps explain it. So tell me kind of what was the short term implications and then what did you do to course. Correct. 

Nathan Kievman [00:05:32] So as the CFO came over and had a private conversation with me, this was all that money was spent between about March and September. So in September, I had a conversation, a really very candid you’re going to the doors are going to shut here, buddy. Let’s make some changes. And and because he didn’t he wasn’t a CFO at the time. He’s now my CFO, but he was like a director of finance. And he was kind of being directed by the single point of direction of all the capital. Right. So we what the biggest mistake I made is I didn’t have. Two roles vetting out the decisions for where money. What? I had one person that was able to do it who was maybe not experienced enough to do so. I wasn’t paying attention close enough. I was focused on selling deals and trying to get new things in the door. I’d sell new deals and they’d be leaving shortly thereafter. And so we had this like week happening in the business and I was like, Wait, what? So so we had a retention that we had to fix, and that was really a culture issue. That’s a different story. We can talk about another time, but you know, there is one singular, very toxic person in my company that I had to get rid of. So the learning that we had to go through, Greg, was that we didn’t have good a good process for managing the money. We didn’t put good controls in place, although we did build a budget for it and we did have that plan. It was it was undercut from the sales side because everybody’s focus needed to move over to retention. So then sales were down, then retention was down to the double. It was like a double whammy. It’s just like, this is like a yeah, what do you call that? One of the drain holes in the large sorority was getting sucked down into the vortex. Yeah. So, yeah, it was, it was a vortex. Exactly. And so we had a big team made up, our team made up in, in October and said, All right, we need to, we need to cut the fat. Everything’s got to change. So that forward six months, we cut $2 million of cost out of the business. We eliminated most executive roles, move most roles into functional delivery roles with a couple management roles of oversaw, but not senior executives. We had two senior executives, I’m sorry, one myself as a primary senior executive. And then and we kept two as part time fractional and the rest were non managers and doers. And so we cut to $1,000,000 between that. We also canned the technology build. It was just a drain on profits. We focused back on our core services model, which saved us about 1.1 million a year between the developer cost and then all the technology that we were spending money on with NWC and other other, you know, non people costs. And then we got really lean. So we went from the here’s the math, we went from a $3.4 million profit and $1.7 million cost in 2122 we flipped it 3.4 million in cost and 1.8 million in profit and revenue. And then this. And then in 23 we’re going to end up and around. Right now, we’ll do about 3.2 to 3.4 million and 1.4 million across some of you. Yeah. So he just totally flipped it around. So but it was hard and it was a lot a lot of people transitioning. Yeah. So. 

Greg Alexander [00:09:09] Well, listen, I appreciate you being vulnerable enough to share the story because, you know, there’s people going to be listening to this and they’re going to avoid this painful mistake because of your willingness to share. I want to highlight two things. First, if I had a nickel for every time I’ve heard the story of a service company trying to become a tech company and screwing themselves up in the process, I’d be a multi-billionaire. So I want to be very clear to members that are listening to this. If you’re a services firm, do not try to become a technology firm. Everything is going to cost twice as much as you think, and it’s going to take twice as long as you think. And it’s not who you are. Your services firm. So don’t do it. And there’s a lot of misconceptions out there. You know, people say, well, if I become a SAS company, you know, the valuation of my firm is going to go through the roof and I’m going to make a ton of money. That’s actually not true. If you look at exits of founders of services firms, they end up making more wealth than founders of technology companies. And why is that? It’s because of capital intensive intensity. Services firms don’t really require any capital, so you don’t have to take on debt as a needs case. You don’t have to dilute yourself by selling equity to people. You can bootstrap and fund the firm yourself. So upon exit, you own 100% of the firm. If you’re trying to become a tech company upon exit, you’ve got to pay the back. You got to pay the equity person and therefore your net proceeds from the sale is much less. In fact, I wrote a blog article on this. You might take a look at that. I think it’s titled Why Services Firms Should Not Try to Become SaaS Companies. But that’s a huge mistake that I want everyone to avoid. The second thing is, is that, you know, high powered senior executives that cost a lot of money and services is also not a good idea. I mean, you want everybody to be billable, either in total or partially. So their expense and running the firm, the on the business stuff is covered by revenue that’s coming in from clients. So two huge lessons there, you know, from Nate. So, Nate, let me ask you a little bit about the debt. So you raised it from the SBA and you raised it from private lenders. It’s all gone. I’m assuming you haven’t paid off the debt yet. You’re still on the hook for it. Is that true? 

Nathan Kievman [00:11:16] Yeah. Yeah. So now. But now I have to go pay that off. You know, that’s the airline’s super, super generous of the 30 year term on 3% and not paying it back yet. But that’s awesome. 24 right around the corner. So I want to add to my path of of in the business, like my my bachelor path and and and it’s just that particular. That’s just I mean, like, I’m really if something happens, I’m going to have to take care of it. So now I remember the text message and cost me $2 million at a minimum, probably like about 2.5 over a three year period of my profit. That’s out of my profit. Yeah, it would have otherwise been profit. And now the debt that I used to pay for those people, I’ve got to pay back on top of that. So I mean, that’s a really heavy cost. And Greg, stay with me. Like, this is the direction we went this way because Greg and I had a very candid conversation. He just wrote the article that week when we had this conversation on the tech. But at the end, and it was a hard decision because it’s like you’ve grown a baby for three years, you kind of want to see it through. But the end of that path was death. So I said, okay, let’s stop this now. And, you know, lesson learned. Hopefully you all can hear this because I really resonated with Greg’s story. And now we’re a super profitable company if we’re a very healthy company. But I decided to be stupid and follow these these shiny objects which, you know, can be part of our founders problem occasionally. So, you know, lesson learned. And yeah, I’ll be paying off, you know, $1.8 million of debt over the next while that’s a little less now but over the next many years. Yeah. 

Greg Alexander [00:12:56] So you know, the one good thing about your story, Nate, the mistake that you did make is you didn’t sell any equity. That would have been a real kick in the teeth because equity you can’t get rid of. I mean, you can pay off the debt. You know, it sucks that you have to do that, but you can pay it off and get back to zero and then grow again from there. If you had take on an equity partner, now you got somebody owns 20, 30, 40, God forbid, 50% of your firm and you can’t get rid of them. So thank goodness that that you didn’t do that. And that’s another lesson. So, Nate, lastly, you know, if you were to kind of summarize, maybe, you know, for those listening, any other words of wisdom or advice that you would share with people that we haven’t discussed today regarding this issue? 

Nathan Kievman [00:13:39] Read the boutique and follow the instructions. I mean, if if I had read it and had some of the insights prior, that would have saved me millions of dollars. Yeah, right. And and and it did it still, even though I only did it halfway through, it still did save me. Possibly my company, actually. Yeah. You know, I would say definitely take the word of wisdom. Greg’s been a great resource for me and an advisor and from an experiential level, but also the community. I mean, I’m very involved in the community. I talk with members, I learn from members all the time, the the board board program we have. We have great value contribution to each other and insight. Um, but I would actually say my biggest takeaway of all of this is. Before you start giving away executive seats or partner seats in your firm. And then there’s the equity part of that, because I did have Greg, I did give and I brought it all back. I was able to retrieve all my equity back, but I almost lost 34% of my company while in the process of all of that. And and I would say that to. To have controls in place. So for me, the biggest thing was if I had a proper reporting mechanism that I could see weekly of what the money was going towards. I could have stopped it, but I didn’t. And I trusted really poor people more than I should have trusted them. And they abused money that they had never seen before. Right. So it wasn’t their money. It was easy to go increase everybody’s pay by five or ten grand. And then, I mean, we had a board session with with the CFO for board. And in that session, but the context of executive pay norms came up and I was like, what is what is normal for everybody? Well, I got quoted from two different people in my company that I trusted that this was normal pay for people. And when we heard the numbers on the board were like, no way down here. They’re quoting me like billion dollar corporate normal pay structures and our normal pay structure as a start up boutique. I’m like, I’m like, Oh my God, I’m paying way too much for all these different roles. And when it just it just didn’t the math didn’t work, right? So I would just say, make sure your controls are in place. Trust, but verify, especially with executive teams, have double points of control that check against each other, especially when it comes down to the money part of things. And those are my big takeaways. And don’t do that. Like you’re going to detect them on a separate entity. Go raise money for that person. Just leave your services business as its own cash cow. Awesome. I hope that’s helpful, Greg. 

Greg Alexander [00:16:25] Yeah, Super helpful, man. All right. I got three calls. Action. One for members, one for candidates for membership, and one for tire kickers. So, members, look for the meeting invite. We’re going to have a private one hour Q&A session with Nate. I’m sure all of you got a thousand questions because you either have made this mistake, which I have myself in the past. That’s why I can speak so authoritatively on this. Or you might be getting ready to do some of these things and speaking and it will be really important. So eyes open for that. Candidates for membership. If you want to become a member, go to Collective 54 Adcom Fill out an application. The membership review committee will look at it and get back to you. And if you’re not ready for either one of those two things and just want to learn more. Go to Amazon, buy the book called The Boutique How to Start Scale and sell a professional services firm written by yours Truly. But Nate, on behalf of the community, every time you make a deposit into the collective body of knowledge, it’s dead on. So thanks a bunch, man. I really appreciate it. 

Nathan Kievman [00:17:24] For sure, Greg. Appreciate you. Community is great. And for anybody considering joining Giant, it’s worth its weight in gold. 

Greg Alexander [00:17:31] Thanks for saying that. 

Nathan Kievman [00:17:31] That’s all I can say. 

Greg Alexander [00:17:32] Okay. Take care, buddy.

2x Your Revenue with this Share of Wallet Exercise

2x Your Revenue with this Share of Wallet Exercise

Play Video

You can quickly identify the available market that’s sitting inside your existing account base by conducting a share of wallet exercise. And once you identify the opportunity, you’ll start to notice the obstacles in your way.

Learn about conducting a share-of-wallet exercise, how to get more of the shared wallet, and how to manage a team with all of that in mind.

In this video, you’ll learn:

    • What a share-of-wallet exercise is
    • How to use the share-of-wallet exercise to identify growth opportunities
    • How to increase sales with existing accounts based on what they don’t know
    • Effective strategies your team can utilize based on data from the share-of-wallet exercise

Episode 142 – Why Recruiting for Sales Positions in Small Service Firms is Different and How to Adapt – Member Case by Carter Hopkins

Recruiting for sales positions in a small service firm is not the same as recruiting for sales positions in large service firm, or in a product company. This session will help you avoid making costly hiring mistakes as you build out your sales team.


Greg Alexander [00:00:10] Hi, everyone. This is Greg Alexander, the host of the Pro Serv Podcast, brought to you by Collective 54, the first community dedicated to the boutique professional services industry. On today’s episode, we’re going to discuss recruiting salespeople into a small services firm, which is a very precise recruiting process. And we have a wonderful role model with us today. His name is Carter Hopkins, and he’s a member of Collective 54, and he runs a firm that this is what they do. They recruit for sales, and he’s successfully done this for several of our members. So he’s got a lot to offer on this topic. So, Carter, it’s good to see you. Please introduce yourself to the audience. 

Carter Hopkins [00:00:59] Yes, they’re great. Thank you so much for having me. Honestly honored that you asked me to be on the podcast. So, yeah, I’m the founder of Pursuit and we are a sales and marketing recruiting firm that specializes in helping our partners scale out their sales and marketing function with top talent. 

Greg Alexander [00:01:16] Fantastic. So let’s jump into it. So my first question is how is recruiting for sales positions inside services firms different than recruiting for a similar role in a product company? 

Carter Hopkins [00:01:31] Absolutely. I think a. You know, for me, recruiting for sales in general is so different than any other type of recruiting out there. And that’s really the reason I started our company eight years ago, is because I there are a million recruiting firms out there. There’s not a lot of sales recruiting firms. And I believe sales recruiting done well is very, very different than recruiting an engineer or recruiting somebody in I.T. or something like that. And the reason why is it’s it’s it’s not as much about the resume. It’s a lot of it is about the intangibles. It’s about the person. And there’s no certification on a resume that’s going to sell anything. And so, you know, our approach to sales recruiting and don’t get me wrong, a lot of times we are looking for specific things on a resume as well. We’re looking for those intangibles that you may not necessarily be able to to see on the resume. And I think that makes it a little bit different, as well as recruiting for a professional services firm and sales within a professional services firm. Just the motion is a lot different than it is when you’re selling a product, you’re selling a product. A lot of times it’s the same sales pitch over and over and it doesn’t really have to be a solutions based sell. And when you’re recruiting somebody to a professional to sell within a professional services firm, it’s not tangible. Your the sell itself looks so different than it does when it is one product and you’re selling it the exact same way every time. Yeah. 

Greg Alexander [00:03:12] I agree. That’s a that’s a really good point to bring out. You know, sell services. You’re selling the intangible as a product, as a tangible. That’s a very different emotion. So that that’s a good ad. All right. Let me let me ask the next question, which is, you know, our our membership, because you’re a member and, you know, this is is focused on boutiques, which is code for smaller firms. So let’s talk about the size dimension. So when you’re recruiting sales positions for a small company as opposed to a large company, how is that different? 

Carter Hopkins [00:03:44] Yeah. Working at a big company. Opposed to working at a small company is so different. And you know, the thing that I would encourage members that are listening to this is when you recruit, you need to sell for what you are. And be very upfront and honest what you are with these candidates. And if the candidate is the right candidate for your small firm, that will excite them. If the candidate is the wrong candidate and you’re in, you are going through the good and the bad about working for a small firm, it will scare them away. And so for us, you know, for me, I started the company eight years ago and we’ve built it out. And, you know, I have when people come in to interview with me, I have to tell them, hey, it’s it it’s not a huge firm. We may not have all of the benefits for a lot of these sales reps that are coming from from big firms. What I see is they have a ton of resources. They have a marketing department, they have all of these different resources that they have access to. And then you throw them into a small environment and they’re not used to that. Like they’re like, Hey, where’s where is the client marketing collateral? It’s like, Well, I don’t know. You may have to create that kind of small firm. And so, you know, I think for me personally, I love small business, obviously. And if you sell it correctly, because to me, there’s a lot of advantages of a small firm. Candidates want to know that they can move up quickly. And I believe that you can in a small firm, they want to know that there’s not as much team in to work through. In a small company like that. There is a big company. They want to know that they have access to the founder. There’s a lot of selling points that you you can talk to candidates about that are true. But I would also say almost sell against your opportunity. Hey, here’s what it’s not in the interview process and what it will do. We’ve lost candidates that I liked and I thought could have been good, but they didn’t want that. And I would rather know that in the interview process than figure that out four months down the road and have them leave. 

Greg Alexander [00:05:43] Yeah, I like that. So against it, that makes it’s kind of reverse psychology. And I agree with you. I can’t tell you how many times I’ve seen our membership and even outside of our membership, people get enamored, you know, with the person with 20 years of industry experience, you know, try to bring him in to this small firm. And it’s a trainwreck because they can’t scale down to a small firm. They’re used to being surrounded by all these resources and small firm. It’s it’s largely, you know, building the plane as you’re flying the plane. And you need scrappy people that can make it happen. And sometimes these big company people, they have a really hard time scaling down like that. So that’s a mistake. We’d like all of our members to avoid making speak. 

Carter Hopkins [00:06:25] And I think real quick on that, Greg, another selling point that I believe in small business for is if you’re in sales, you want to try to you want to try to create value within your company as an individual. And I believe it’s easier to create value for a sales rep in a small company than in a big company. And the reason why is because when you work for a big company and you walk in there and the name on your shirt sells itself, yeah, it’s really hard. You’re very replaceable. Yeah, very replaceable because the company’s buy, the buyer is buying from the company and not from you. When you work for a small company and you walk in there. And when we were a, you know, a six person company that preceded you, and our sales rep walks into the room and says, Hey, we’re pursued. They don’t know who pursuit is. So they’re buying from David. They’re buying from a person opposed to buying from a company. And so for me, that’s one of the reasons I always we work with a lot of small companies, and that’s one of our selling points to candidates about going to a small company. You may miss out on some benefits and some of those things, but you’re able to create so much more value for the company, which in turn creates value for yourself. 

Greg Alexander [00:07:33] Yeah, good point. So let’s get to one of the biggest mistakes that members are making right now, and that is they’re over hiring in the sales leadership role and they’re hiring for it too early. Yeah, you and I have spoken about this previously. I’d love for you to share with our members why you think this mistake is happening and maybe what to do about it. 

Carter Hopkins [00:07:59] Yeah, I think so. Here’s kind of what I see. And we have the opportunity to work with some professional services firms, and a lot of times it’s on their first sales hire and you know, they’ve been they’ve been the CEO and they’ve been selling more or less and they may not even wait to sell. Yeah, they may like the delivery side of things and they may be specialized in that, but they find themselves selling and then they listen to Greg and they listen to collective 54. They go, Hey, I need to scale out my sales team. And and they reach out to me. And a lot of times they want us. They want a sales leader. They think that they want a sales leader. That can be a player coach at first that can come in and is going to be an individual contributor. And then go into sales leadership. Right. And what I find is, you know, they want somebody that’s been leading people. Mm hmm. Because they want them to own that sales function. But the hard part about that is somebody that’s been leading people. It’s very hard for them to go back and to go back to selling all day, every day. Right. And they end up frustrated and it ends up not working out well, in theory, in my opinion, from what I’ve seen. And so, you know, I always in most I won’t say always in most scenarios, I believe in hiring somebody that’s going to be a straight sales rep. That’s a little bit probably junior that has no problem reaching out 30, 40 times a day. The person that’s been leading other people to make 40 calls a day is really hard to get them to go back to making 40 calls a day. And what I’ve seen. Yeah. And so, you know, I always cash is king. Right. And like people, how you get cash is you get people that are selling it. I believe your first couple of hires. Most of the time it’s important as long as you can put them in the right atmosphere. It’s important to to find somebody that’s okay with getting out. It’s selling all day. Would you agree with that? 

Greg Alexander [00:10:00] I agree 100%. I mean, listen, individual contributors in sales, it’s a grind. And it is when you get to a mid point in your career or maybe even later on in your career, going back to the grind is just culturally a very difficult thing to do. And for our community, if you think about it, you know, most of them are, you know, early in the development of their sales function in general. So hiring an individual contributor to start with and using that person to kind of be the guinea pig or the test lab, if you will, to figure out what works for you. And then once you understand that maybe that person has the ability to grow into the sales leadership job, if not, at least you know what’s needed now, because you had that junior person in there grinding all the time. So, so really good advice. Speaking of which, I wanted to get to the next question, which is. 

Carter Hopkins [00:10:46] Yeah. 

Greg Alexander [00:10:47] Our members. The stereotype of our members, if I could place it on them is this. They’re absolutely brilliant domain experts in what it is that they do. And that’s the reason why they’ve been able to build their firms, is because of their, you know, intellectual horsepower and their expertise. But they didn’t come up through sales most often. Therefore, they really don’t know what good looks like. And they have out of whack expectations. So they hire somebody and they think sales are just going to miraculously come in and they don’t understand that there needs to be a whole system in place. So can you tell us a little little bit about what expectations should be like and how to avoid this mistake? 

Carter Hopkins [00:11:32] Yeah, I would always I would even caution a lot of times what I see is people want to go hire the person that’s been doing it for 15, 20 or 20 years that says they have a Rolodex of contacts and they just move over the business and all of a sudden they’re making all this money. And where I talked to founders that have made a lot of mistakes is they’ve hired people that say that. And then they get in there and they don’t they don’t do anything. Sales is not easy. It’s not that’s why their sales reps make as much money as they make, is because it’s hard and it is a grind and there are no shortcuts to it. And, you know, I I’m going to quote as a friend, this is sales consultant Gregg Stanley. So I’m not going to take credit for it. But how he talks about it is it’s like a houseplant. You go you go buy a houseplant. And if you don’t put that houseplant in the right environment, it’s going to die. And, you know, and then what ends up happening is the plant dies and you don’t know if it was the environment or if it was a bad plant. And a lot of times you think it’s a bad plant, but really it’s a bad. It’s a bad it was a great plant, but you put it in a bad environment and it died. And so that really hit home with me because I watched that happen time after time again, where you have to create a sales environment and you have to have somebody within your organization to set up that right environment. When I say environment, accountability, KPI is a sales atmosphere where they don’t they they don’t feel like they’re flying solo when the day’s tough and they made 40 calls and they haven’t talked to one person all day long. Like you have to put them in an atmosphere to where they can thrive. And it may be like, Well, Greg, how do I do that if that’s not my background? Fortunately, I love sales. You know, when I started the company, that’s my passion and my background. But for a lot of founders, that’s not their domain or expertise. And I would just say like. I believe in. If it’s not going to be you owning that function, hire a sales consultant that helps you set up that environment correctly from the get go before you go hire that salesperson to put him in that environment overall. And then also don’t think once you hire that salesperson as the CEO or as the founder, you’re just going to be hands off and all of a sudden money’s going to start showing up. You’re going to have to be involved in training, in teaching and coaching the whole way through. 

Greg Alexander [00:14:01] Yeah, I love the house houseplant analogy. You know, when I was in the sales consulting space, I used to tell my clients, Listen, you don’t put a football helmet on Tiger Woods. Yeah, but if you hand him a golf club, you’re going to win Majors, right? So it’s matching the talent to the environment and making sure that you’re putting the talent in a position to win. And it’s very often not understood. And I think your advice of maybe renting a sales consultant that can build your sales environment first. Yeah. Then recruiting in the talent is the way to go. 

Carter Hopkins [00:14:35] Well, and I’ll say the last thing I’ll say to that, Greg, is be patient. Like if you have to play the long term game, far too often I see people playing. A short term game is like, you know, they’ll call, will fill a position, they’ll call me like, hey, never sold anything. It’s like, how long it been? It’s been a month and it’s like, man, it it you have to play the long term game with some of these you know, these people in your organization as well because it’s going to take time to figure it out, especially if you’ve never had anybody doing it before and you don’t have a playbook. Yeah. 

Greg Alexander [00:15:05] All right. Well, listen, we need to wrap this up, but I’ve got a few calls to action here for the listeners. So. So if you’re a member, keep your eyes open for the meeting. Invite. That’ll be coming to you shortly for the private Q&A session that we’ll have with Carter. You’ll be able to ask him direct questions, will go into much greater depth and more able to do in a short podcast. If you’re not a member and you want to become one, go to collect 54 Ecom and submit an application and we’ll get in contact with you. And then if you’re just someone who wants a little, little bit more, I would drive you towards our book. It’s called The Boutique How to Start Scale. And so a professional services firm written by yours truly, Greg Alexander, you can find it on Amazon. But Carter, on behalf of the membership, I appreciate you being here, making a deposit into the collective body of knowledge and I look forward to our upcoming member session. 

Carter Hopkins [00:15:59] Thank you, Greg. 

Greg Alexander [00:16:00] Okay, take care.

Episode 141 – The Secret to Big Sales: How an Executive Sponsor Program and Executive Language Wins Clients – Member Case by Carajane Moore

What role should the Founder of a boutique professional service firm play in the process of acquiring new clients? That of an Executive Sponsor. And how can a Founder perform in this role with excellence? By using executive language. Attend this session and learn about executive sponsor programs and executive language. 


Greg Alexander [00:00:15] Hi, everyone. This is Greg Alexander, the host of the Pro Serve podcast. Brought to you by collective 54, the first community dedicated to the boutique professional services industry. On today’s episode, we’re going to talk about executive sponsor programs, what they are. Why you should care. Why you should deploy them. Who should own it, how to do it, etc., etc.. And I’m joined today by a member of Collective 54. Her name is Cara Jane Moore, and she’s an expert in this area and she’s got a lot to offer on this topic. So, Karajan, it’s great to see you. Please introduce yourself and your firm to the audience. 

Carajane Moore [00:00:52] Well, thanks, Greg. It’s great to be here. I’m CaraJane Moore, president Hunt Big Sales, co-owner and Hunt Big Sales is a boutique professional services firm, and we work with the small and mid-sized businesses to help them grow very rapidly by landing large accounts. 

Greg Alexander [00:01:07] Okay, Very good. All right. Well, let me let me start at the top. So what is an executive sponsor program? 

Carajane Moore [00:01:14] Well, actually, an executive sponsor program is more of an approach to how you go about sales. What we’re trying to do is we’re trying to increase that reality in your pipeline. We’re trying to add some assurances in your forecasting and to increase the close rates of of sales. And so an executive sponsorship is about an approach that’s going to allow us to do those things. So an executive sponsor then is somebody that is at the highest level of the organization you’re going after to secure new services. Right? And so they’re at the highest level that have the business problem that you solve. And that’s really important because oftentimes we end up trying to sell us sell benefits and services instead of solving business problems. And really all biotech firms do is solve business problems. And so they’re at the highest level who have the problem that you solve and then also have urgency to solve it. So what we’re talking about is an approach that allows us to secure those types of people so that they can help us through the sales process to close. 

Greg Alexander [00:02:23] Okay. So why do you think this approach and I like that word is the right approach for our community, which is made up of founder led boutique process firms? 

Carajane Moore [00:02:38] Sure. So as a smaller firm, as a founder led, oftentimes founders are involved in the sales. So one, it’s easier for them to get to the owners of the prospect companies they’re going after because sales, when you’re solving business problems happens at a higher level in the organizations you’re hunting than the managerial levels that maybe sales reps are only able to get to. So first and foremost, we have to get to that higher level and an executive is the easiest way to do that. But you can’t teach your salespeople how to do that as well. So one, that’s true. Two, we’re trying to solve business problems. And so you need the executive sponsor inside that organization because if it’s a larger opportunity, they’re going to be the ones that are going to be making the decision to buy. But even if it’s not a big opportunity, it’s a regular sales opportunity. If you’ve got the person who has the problem, the chances are you’re going to get more information and better information than your competitors on landing that piece of business, because you’re going to understand the nuances of the problem versus working with procurement who has no problem. And we oftentimes get lost in the idea of procurement h.r. Training some of these departments who actually don’t have problems. They’re hired to execute someone else’s problems. 

Greg Alexander [00:03:57] Very good. So if you think about a boutique and the lifecycle stages of grow, scale and exit, in your opinion, is there a good time to start this, a bad time to start this? Like where in a lifecycle should a small services firm think about an executive sponsor approach? 

Carajane Moore [00:04:19] Actually, I think that executive sponsor should start the minute you start if you’re selling, which there’s no way we could be in business if we aren’t selling right. If you’re selling the best way to get efficiency and effectiveness and clarity in your sales approach is only speak to the people that have the problems you solve, not their proxies. Mm hmm. 

Greg Alexander [00:04:41] So some of our founders, actually quite a few, are some of the smartest people I’ve ever met. And when you talk to them about their domain, I mean, you literally go back on your heels and you say, oh, my goodness, this person really is an expert. It’s one of the reasons why I love the professional services industry. However, they’re not great salespeople, not because they can’t be. It’s just they were never trained. They don’t want to be you know, they really love kind of the content of their job. So how do you get them? To be the executive sponsor and sell, Empower. Sell the power. 

Carajane Moore [00:05:19] Yeah. So power to power selling is really important. And although they’re the executive for their own organization, we’re trying to secure the executive at their prospects organization, right? Yep. And because they’re a subject matter expert and they are an owner, right. Or he as a founder, they have some gravitas that allows them to get in that door to begin with, which is why most professional services firms grow based on their network of the founders. Right. And we’ve talked about that and seen the founders bottleneck. And then at that particular point in time, as you’re having conversations, all you’re doing is adding clarity to the rules of the process that both you and your prospect are going to go through to determine if you’re the right solution. So we’re not doing anything unethical or behind the doors. This is all clean up, but we’re just making it clear. So even though they don’t have sales backgrounds or they don’t even want to sell, it’s about having an easy conversation. It’s just as simple as me saying, Hey, Greg, we’ve been talking and it sounds like what we’re talking about, I can solve the problem that you’ve got. And in your end, you want us to continue to look at that. But you and I both know there’s some nuances and we’re going to need to get our teams together. So I have to bring my team together. You have to bring your team together. They have to spend some time kind of working through the details. And I just want to make sure before we get started that you’re willing to be a part of that process, that you’re willing to stay engaged, that you’re willing to give me access to your team and data as necessary to go through the sales process. You’re willing to make it a priority. You’re willing to add clarity when maybe some of the people in your team have conflicting ideas or the urgency overcomes the importance and we get into a logjam and getting data and access. Would you be willing to do that for us so that we can work through this process to determine if we can solve this problem the way you need it in the timeframe you’re asking? It’s a that’s all it takes. 

Greg Alexander [00:07:21] Yeah. I mean, that was such a beautiful summary of it. STEM to stern. I marvel at your ability to take the complex and make it simple. Let’s, let’s consider a use case here. So let’s say I’m the founder of a 50 person consulting firm and I’m trying to scale my firm, which means I’m trying to solve for the founder bottleneck and replicate myself and others and be a great delegator and build a team. So because of that, I have a business development function of some kind of sales function, and they’re out there trying to win new clients. Where how is the labor separated? Like who does what and when does the founder parachuted? 

Carajane Moore [00:08:07] Sure, absolutely. So generally, if you’re on the earlier aid of that lifecycle, right, as a founder, you’re going to be more involved at the beginning of the sales process and then again at the end when you’re closing, as you’re scaling to your point, you should be able to turn over some of those, what we would call traditional prospecting activities to somebody in the business development department who is able to then sell the services. And as a founder, depending on the size of the transaction, whether you should be involved or not really is played at that point. So if you’ve already got somebody in business development and we’re trying to get to the highest person within that organization, you should be able to turn that over because they have to be a seasoned salesperson. If they’re trying to get to an owner. If we’re selling power to power, owner to owner, then they have to have enough. Business acumen and be able to do executive language speak to get in. And there’s three secrets to landing large deals you get sent to whom you sound like. So if you don’t sound like the executive, you’re going to get deferred down to a manager or director. You stay with whom you impress, which means you have to be able to continue conversation and an engagement at that executive level, and you close and grow with those who believe, which means you also have to be convincing. And so that’s part of where maybe a founder comes back in because they’ve got the resources they’re committing to. Yeah. So you should be able to transfer that to a salesperson, but they have to have that executive language, that executive presence and that business acumen to be able to be at that level, to have those conversations. 

Greg Alexander [00:09:47] So let’s talk about the executive language. And I know that your firm has an executive language program and how critical it is. And I think it’s so relevant to our community because our founders, they speak in jargon. They speak in like their domain expertise. And if you’re going to be power to power selling to an executive, the person inside to they don’t even understand all the three letter acronyms. So So how can one of our members get themselves trained on executive speak? 

Carajane Moore [00:10:24] Yeah, absolutely. Well, like you said, we’ve we’re launching a new program, Big Sale Secrets, and it’s really about mastering that executive language to close more deals. And that’s that language is more it’s less about the details. And this is one of the things that I think is really important. Executives buy to solve a problem of the future. They’re buying a better future. So they don’t need to know the details of how what we’re doing to solve that problem is going to happen. That’s what their team is for, to evaluate. So executive language is talking about the bigger concept, the bigger idea. We’re talking about money, not price. Right. We’re talking about leading through influence, persuasion and executive through some of the data. And especially if we’re talking about our founders speaking jargon, we’re going to back it up. We’re going to lead them through data and the analysis of that data to implications. And as executives themselves, they’d rather make a decision off of an option. So you have to be able to place the options that don’t include you as a part of the decision making framework for your executive buyer, then provide the recommendation for that choice. And so by putting in some of these conversational arcs and tools, how do you use napkin math so that we’re not into the precision, but we’re giving the big picture idea bullet points, bite sized, but a full arc of concept for executives to make a decision now. So our video program does exactly that. And then we’ve added C suite fluency because it’s a new language, right? So we have to become fluent in it. And what we’re learning is in today’s world, we want to consume information so rapidly, but we don’t take the time to practice and perfected. And so when you’re learning a new language, you have to practice that language. I don’t know about you. I try to do Spanish on a Rosetta Stone, and I could read it and I could I could understand it when they said it, but when I tried to say it back to them. Error. Yeah, error because I couldn’t get the role of the hours and all. I mean, it was, it was really fun and my daughter’s just fluent and I can’t write. Well, that’s the same thing when we’re talking about salespeople or founders trying to learn how to speak at an executive language, which is not their day to day language because they work with their own peers. And if your founders are those very, very smart people, but they’re the subject matter experts in their business, they’re going to be jargon based. Yeah. So we have to elevate them into business based conversation. 

Greg Alexander [00:12:59] Yeah. You know, I’ll share a story with the membership. I made this mistake that Cara Jane is talking about. When we first hit the market with collective 54, we would talk about helping a services firm grow, scale and exit. And I thought everybody understood what that meant. And I had several people say, What are you talking about? And finally someone said, So Greg, what you’re really talking about is going to help me make more money. You can help me work smarter, not harder, and you can help me get to an exit bigger and faster. And I almost kiss the person. I’m like, Yeah, that’s exactly what I’m talking about. So we have since taken that language, which is their language, not my language. I was using industry jargon and it wasn’t, it wasn’t landing. So using their language is what really happened. And that’s what this executive language program is about. All right. One more question for you. So let’s say I’m a member and I’m listening to this and I’ve now been inspired, you know, to go implement an executive sponsor approach. What obstacles should I anticipate? 

Carajane Moore [00:13:55] Well. So first and foremost, the first obstacle and I know this seems really obvious, but everybody misses it if you’re going to go ask for an executive sponsorship. Oftentimes people are afraid and it’s our side that’s afraid. So we kind of say it. We don’t really lay it out or. And so the biggest obstacle that we find is we work with companies to get them to do that is their own teams fear to actually go have that conversation. What I will tell you is when you’re actually speaking to executive, they are absolutely thrilled that when you have a problem, you’ve got a process, you’ve got a plan, and you know exactly how to execute it. And they know where they’re supposed to step in. They are grateful for the conversation. They’re not resentful. And so first we have to get over the fear. That’s the first piece. The other piece is if the answer is no, that tells you a whole lot of information. One, if they say, no, I don’t want to be your executive sponsor, it might be because they’re not the right person. Right? Might be because they’re just kicking tires and they’re not interested. Right? Answer Stop wasting our time. Right. So there’s nothing to be afraid of. This is just an easy conversation. Right? So those are some of the key obstacles. The last thing is, it depends on who you’re selling to. If you are in big situations in which you can’t speak to anybody, you can’t ask for an executive sponsor at that particular time, even though you might be able to gather more information. Right. If you’re speaking to municipalities, we have to be careful about the language we use. We don’t say executive sponsor because that sounds like we’re for you to win versus others. And that’s not what we’re asking for. We’re asking for to guide us through the sales process like they would anybody else. Right? So government, military contracting, some of those types of things, the language has to be tweaked just a little bit. And we’re not asking them to sign an agreement and we’re not even asking them to favor us. We just have to be careful. That’s an obstacle in some of those organizations that you have to be aware of. 

Greg Alexander [00:15:58] All right. Very good. Well, listen, we’re out of our time here, but this was really intriguing. And I’m so looking forward to the private Q&A session we’re going to have with the members where members can ask you questions directly. And I’m sure there’s going to be a ton of them. But, Caroline, you’ve been a wonderful addition to our community. You’re always a giving member. You’re actively participating. So on behalf of the entire membership, I just wanted to thank you for all that you do for us. 

Carajane Moore [00:16:22] Oh, well, thank you. I love being a part of C 54, and I keep referring everybody I can because I think it’s a great organization and a great structure for professional service firms like mine and yours. So yeah. 

Greg Alexander [00:16:35] Okay, so audience members, three calls to action. So if you’re a member, keep an eye out for the invitation that’s going to come for Carajane’s Q&A session. If you’re a candidate for membership, go to collective 54 dot com and submit an application and we’ll get in contact with you. And if you’re not ready for that, just want to learn more. Go to Amazon and find my book. It’s called The Boutique How to Start Scale and Sell a Professional services firm. And we talk about lots of topics that hopefully resonate with you. But thanks for listening. And until next time, I wish you the best of luck as you try to grow, scale and exit your firm.