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Episode 22

Influence vs. Impact: Redefining Success in the Accounting Profession





Episode details

This week on the Expert Voices podcast, Randy Wootton, CEO of Maxio, speaks with Rob Brown, Co-Founder of Accounting Influencers Roundtable (AIR), and author of the book “Build Your Reputation.” Rob and Randy delves explore the evolving responsibilities of accountants and accounting firms as they navigate an industry that demands a shift from traditional compliance to more strategic advisory roles. Rob touches upon the challenges faced due to an aging profession, technological advancements, and the shift towards value-added services. Listen this week as Rob shares effective strategies for making an impact and selling to accountants, highlighting the significance of establishing authentic partnerships and providing impactful solutions.

Speakers

Randy Wootton
Randy Wootton
CEO, Maxio
LinkedIn
Rob Brown
Co-founder, Accounting Influencers Roundtable
LinkedIn

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Video transcript

Randy Wootton (00:02):

Well, hello everybody. This is Randy Wootton. I'm CEO of Maxio and your host of The SaaS Expert Voices, where we bring SaaS experts and people working in and around the SaaS field to you to talk about what's happening today and what is on the horizon. And with me, I'm really excited to welcome Rob Brown. Rob Brown has a very interesting background. Started off as a math teacher, which we will get into, and then worked on training accountants and how to build a reputation. In fact, actually wrote the book, Build Your Reputation, which we'll talk a little bit about. And over the last six years, he's been facilitating conversations with accountants and how to get to accountants through his Accounting Influencers Roundtable. One of which I joined. It was really fascinating to talk with people. As Rob will tell you, accountants are the second most sold to profession. The number one is doctors. Number two is accountants. We'll get into that. And what does it mean to sell the accountants, the trends in accounting, what's happening, what are the challenges they're dealing with? And if you're trying to sell to accountants, bookkeepers or sell at CFOs, what do you need to know? But Rob, thanks for joining us.

Rob Brown (01:06):

Randy, pleasure to be here.

Randy Wootton (01:08):

So let's start with that. You were a math teacher. In our pre-brief we were chatting a little bit about the fact that my first job after ... Well, actually, I was still teaching in the Navy. I went and took a master's and went and taught midshipmen at the Naval Academy before transitioning into the corporate sector. You were teaching math and we were talking about why you got out of math. Can you talk a little bit about what your hope was when you had spent those eight years teaching math to students and then what your realization was about what was happening in that dynamic of teaching?

Rob Brown (01:37):

Well, we're all idealists at heart. We want a crusade. We want to cause a passion, a purpose. And like anybody I got into teaching hoping to make a difference and influence young people's lives. And to an extent you do, but the education system almost everywhere is very structured, it's very prescriptive. There are curriculums you have to adhere to. And rather than educating children and preparing them for life, I ended up coaching them to pass tests.

(02:03):

Now the UK is one of the most tested nations in the world where I am and I'm sure the US where you are around, is not too far behind. And to examine these children within an inch of their lives and put them through all these tests, you then end up having to teach to the test. And that's not education. And when I'm going through trigonometry and algebra and Pythagoras and things like that listeners will be familiar with, how really do you use that in real life? Unless you're an engineer and you need that, so you probably don't. So the stuff I really wanted to teach, the stuff I really felt those children needed to know was not on the curriculum. And my metric for success became how many of your pupils can you get to pass this test at this grade or above? And that's when I thought, this is not what I signed up for.

Randy Wootton (02:57):

And those are the A levels and the O levels construct. In England in particular, my understanding is they're pretty draconian in terms of the way they wean people out. You take the test and based on that, you either continue tracking towards going to university or you end up getting tracked to going to VOTEC or vocational technology. So it's much more deliberate and almost impactful than what we have in the States in terms of the SATs where kids can choose to do that to help influence which school or college they go to. But in England it's much more of a pyramid system. At least to me it seems that way. And that's probably what drives you to have to teach to the test because everyone's just trying to pass it and get onto the next stage. Is that right?

Rob Brown (03:37):

You're not far off. Schools are not fit for purpose in so far as they are academic institutions. And you know many entrepreneurs, Randy, they're not academic. They're vocational, they're entrepreneurial, they're business minded, but they're not academic. So when you put kids through a system of having to pass tests and memory and recall and things like that, that doesn't suit a lot of people. It warrants change for sure. One of my two daughters is actually in the American education system. She's going to university in North Carolina. And now that we've seen the American university system and the electives and the credits and everything else where you can get a really holistic education with stuff you enjoy that will help you for life, that's a much more preferable system to here in the UK where you would start a degree and from day one you would be doing organic chemistry and nothing else or accounting.

Randy Wootton (04:28):

Yeah. And I think there are choices there. So I have two boys, one's 19, he's in college at liberal arts school and I think that is the modus operandi of the liberal arts schools to provide a broad-based education, help you find yourself, discover yourself, and then through that discover what your passion is. So you have a vocation and an avocation. My other son who's a junior in high school, so looking at colleges is pretty convinced he wants to go to computer science and is looking at schools where that's where he starts and that's the track he has to run. And to your point, I'm anxious because I know how I evolved from 18 to 22, and I started off wanting to be an aerospace engineer at the Naval Academy and graduated as an English major and then went off and took a master's in the great books. Completely different, though I stayed in the Navy, just radical shift in who I was and what excited me. And so for my youngest son, I keep coaching him. I'm like, well, maybe go to the liberal arts school initially and if you really like computer science, you can go get a master's. But give yourself time to be a proto-adult around people and ideas and figure out what lights you up versus what do you think you're going to get paid for post-graduation.

Rob Brown (05:37):

That all sounds grand. You and I are not here to put the education system right. There are smarter people than you and I, Randy who've tried for thousands of years, but let's move on. The education system will stay as it is. Let's try and change the accounting system. That's another-

Randy Wootton (05:53):

Let's try and change the accounting system. Perfect. Well great transition. And thank you. I rarely meet other teachers that are in the commercial sector, so it's wonderful to have a chance to share and empathize. So I think really the thing that would shift to Rob, with all your experience focusing on accounting as a profession, can you talk a little bit about how you've been bringing together these conversations and what are you seeing with regards to the trends that are happening now and what people are anxious about going forward with the accounting profession?

Rob Brown (06:23):

Well, just for a little bit of context for the audience here, Randy, you're in the SaaS world, you're talking to CFOs, CMOs all the time. Explain the relevance of accountants to their world. So I can speak to that question with much more context.

Randy Wootton (06:43):

Yeah. Well, I think there's actually a couple of ways that people work with accounting firms. First, if you're an early stage founder, CEO, you're usually technical. And so the assumption is you don't know a lot about accounting and you don't speak that language, right? I went to business school, you have your training in terms of learning the language of business, which is accounting. What you end up usually doing is hiring a CPA firm. And so there are lots of CPA firms. There are a client advisory services is what they're being called now. Who support from a bookkeeper function to really up to basically a fractional CFO where you're helping the person get the accounting done, i.e. the three financial statements, but also be an advisor with you specifically around cash. How do you manage cash, what the different cash flows are and how long you have, what you earn and will usually help as an advisor, not the lead for a funding round.

(07:36):

So I work with companies. Mostly are ones who are privately invested either through VCs or PEs. So you think about the seed rounds, the angel, the friends and family rounds you probably have a CPA firm. When you get to series A series B, you're working with a CPA. Maybe bring on a fractional CFO. Often your first hire in the finance department will be a controller. A controller who may have come out of the Big Four, Big Six who now is thinking about wanting to be a VP of finance. And so they'll come on board and they'll help run the books and create that financial operations. And so that's the next inflection point is where we as Maxio sell to companies to help them with the revenue recognition and the reporting and the business office. At that stage at Series C, you're using accounting firms for audit basically. And so there's an evolving relationship initially they’re critical partners, the bookkeeper advisor, and then you move on with the relationship as they go forward.

Rob Brown (08:31):

Okay. So you touched on a lot of key things that are driving change in the accounting profession. We call it a profession here in the UK, you guys call it an industry to an extent, but tomatoes tomatoes. We're proud of being aligned with say a medical profession or a legal profession. We don't really say a legal industry. But however that works when you look at accountants as a whole, let's first make a distinction between what is an accounting firm? Because you've got the big four that turn over billions, and there's a huge difference between them and the number five and the number six and the top 10 and the top 20. Then there's a big difference between them and the top 500. And you go right down to the one person that has a bookkeeping or accounting qualification that will do his nephew's tax returns every year and that's all they do. But they have a CPA or a chartered accounting qualification.

(09:23):

So when we talk about accounting firms, it's really difficult to generalize. Equally when you talk about accountants, it's very difficult to generalize because there's so many different types of them, but we can make some generalizations. What we know about accounting is first, it's a very aging profession. 75% of accountants are at or close to retirement age. It's been run by the baby boomers. Now what's going to happen when they retire and move on? There's a massive transference of wealth. There's a massive shakeup of business models. You're familiar with the partnership model, the managing partner, the equity route. Let's buy into that and get ourselves a pension pot. There's all that going on right now. Private equity money is speaking to that because VC money, PE money is buying accounting firms for whatever reasons. We can discuss that.

(10:19):

So it's an aging profession with aging firms. And what happens with that too is that coming in the top of the funnel, the talent funnel are fewer and fewer people. CPA qualifications, accounting degrees are not as popular as they were. There are many more options available to young people now to go at. So there's a huge talent shortage. So we could speak to that. But the other thing that's happening as a driver of change ... You mentioned it briefly. Accountants are mandated by law for a business. Everybody needs an accountant. You need an accountant to stay out of jail to get your audit done, your tax returns, everything else. So they're in a very enviable position that they've got an elegant business model where everyone needs them. And there's money coming in every month, every year. However, the value that an accountant brings is going down because they've had a historically backward-looking focus.

(11:20):

What has happened? Let's report on what's gone on. And that historical focus is not valued. It's called compliance. It's called what's necessary. And businesses can't use that to a degree. They do it because they have to be compliant and fulfill tax regulations but where's the value in that? So you hinted at that. The compliance versus the advisory debate. So there's downward pressure on compliance fees, this downward pressure on the historical reporting because that's not worth too much beyond what's required by law. So accountants are now having to reinvent themselves as consultants, coaches, mentors, trainers. Throughout the pandemic we even saw accountants morphing into therapists, psychiatric counselors, shoulders to cry on. They're helping businesses keep the lights on in the worldwide pandemic. So you're now starting to look at the accounting role as something that requires a lot more than technical qualifications. So that's just some of the drivers we can speak into here that might affect your audience.

Randy Wootton (12:29):

I think there's a really interesting construct in terms of the ... Because The SaaS Expert Voices is really focused on the office of the CFO, how that's transforming and the role of the CFO, many who start as accountants and how that's evolving and what are the new skills you need. One of the things that struck me in your comment was that the accountant now needs to think about how they add value, and that may be something that they don't feel comfortable with. So I remember I did a stint with Bain Consulting, very short stint. But in the consulting model, they have three stages. You have your first stage, which is the analyst. So you got to crank out the spreadsheets. And so to your point, if it's not historical, look back, you got to know your numbers and you got to put the spreadsheets together.

(13:07):

The second stage was a consultant or an engagement manager. And that meant really you had to manage the client relationship and you had to be able to get all the pieces together and construct the deck and come up with some insights. But it was really around the project management, client management. And third stage was the partner stage. And the partner stage was where you added the value. Is where you would build the relationship and you would add strategic value and scope out ... I'm talking about strategic consulting, so the Baines, BCGs, the McKinseys, you would scope out a statement of work that would say, Hey, here's the problem you're trying to solve. Here's our approach to it. And then you deploy your engagement managers and consultants and your analysts as a case team to go after that.

(13:49):

It is hard for those consulting firms. They have enormous amount of attrition to find someone coming out of college to be all three of those. To be able to come in and be an analyst and then go off to business school and then come back as a consultant, learn how to be a consultant, and then move into that third phase around client advisory and strategy. But it's a very deliberate path and they have training for each of those. And so in the accounting profession, do you feel the way that the structure is set up or the training that people take or the way that the model works, the rewards and sense trains people for the different stages of what needs to happen so that the head of the firm or the accountant with 15 years experience is learning how to be that strategic advisor to the CFO, how to be the strategic strategic advisor to a VC or a venture partner as they're looking to invest in different companies?

(14:43):

Or is that something that needs to be done? There needs to be this level. I know in Europe you have this ... It's not a CPA. It's the CMAG or something, which is another certification around finance and strategy, and it feels like there is that piece there. So talk a little bit about how an accountant today, if they're entering the profession, would think about the stages of their career and how they build those skills and capabilities.

Rob Brown (15:08):

It's a super question with so many different layers and you're pushing a lot of buttons here. Let's talk briefly about the accounting qualification and ask the question, is that fit for purpose? You've got many governing bodies. You're highlighting one there. The ICPA in the US is the ACCA here in the UK, the Association of Chartered and Certified Accountants. Whichever route you go down. And there are many others. They have a curriculum a little bit like me as a school teacher, which they have to teach. But the question is, does that turn out accountants that are fit for purpose in a modern day world? Because it trains them on compliance and technical qualifications. Now, yes, that gets you in the as an accountant, but you're absolutely right. As you migrate through the tiers of relevancy and value, you need to be adding in different skills. So I've long since talked about the five skills or attributes that accounting types need to stay relevant and competitive. May I talk you through those?

Randy Wootton (16:05):

Of course. That'd be great. Thank you.

Rob Brown (16:06):

So level one is the technical skills. You've got to know what double entry bookkeeping is to an extent. You've got to know your way around the tax regulations and everything else. So that's technical qualifications. That gets you in the game. Then there's technological skills. So accounting finance types these days, they don't need to be nerds and geeks and be able to write code, but they need to do more than turn a computer on and off. So you're now asking accountants to do a whole lot more than you did 20 years ago because they've got to be tech-savvy. They've got to know the apps. And the average accounting firm uses about a hundred different pieces of software. So you're now asking a lot more of your accounting professionals than you ever did. So that's the second level, which is your technological skills. Then you need commercial skills.

(16:54):

You're going to be a CFO, you're going to be an advisor, you need commercial acumen. Business awareness. Now, accountants are not business people. They know how to help a business, but they're not entrepreneurs. They're not business owners by and large. Some of them are. But they're generally employed people on the staff maybe with some equity in it, but they're not entrepreneurial by nature. So by commercial awareness, I'm saying accountants need to think like business owners, and that is a skill gap that is difficult for them to breach. Some of them do it well, but there is a leeching out of accounting where people are going into tech, going into CFR roles, going into industry, going into tech companies because they're not getting the skills they need in an accounting firm. So you've got three there. You've got technical, technological, and then commercial awareness.

(17:50):

The fourth is people skills. Mental health is at a premium, isn't it, Randy? We talk about this. Hybrid working, remote working. So now as an accountant, you are also a manager, a boss, a leader. How do you lead a firm? How do you lead a vision? If you're in a CFR role or an accountant in industry how do you lead your team, your finance team? How do you lead your clients? So all of this comes into play with people skills and empathy and presentation skills. And the final one, which is the top of the tree, is selling skills. And what I mean by that is accountants are more and more being encouraged and even expected to sell their services, to be a rainmaker, to make opportunities for their firm to open doors. And even, let's take a very basic CFO role or accounting role. You've got to sell an idea. You've got to sell the story behind the numbers. You've got to sell the narrative. You want board level, buy-in for your analysis, you've got to be able to sell that. You've got to be able to talk about what the numbers mean.

(18:54):

So you've got to be able to sell an argument, an opinion, an excuse, a statement, a fact. You've got to be able to get behind the stats. So you're asking much more of an accounting and finance professional now than you ever were. And that's why it's rarefied air to get somebody that can do all of those things and this is why we've got a problem.

Randy Wootton (19:18):

Agree. Can you speak a little bit to ... I think we were talking about the accounting certification that gets you at level one, and then I think there's another accounting certification which helps you, I think probably with the business awareness, that level three, that's that CMAG. I think it came out of England actually, and now is integrated to the AICPA construct and certification. And we'll get to your book in a second because I think that really speaks to level five. But how do most accountants develop these skills around selling skills today within the firm or if they're a single proprietor? To your earlier point in the US at least there's 60,000 CPA firms or 300,000, something like CPAs, but of the number of firms, there's 60,000. So there is a very long tail of people who are running a single proprietor shop or a small shop with a couple of accountants. But how do people learn the selling skills? What's the way they're embracing this new reality of having to be more strategic and come up with ideas versus just reporting on the historicals?

Rob Brown (20:18):

The short answer is, Randy, they don't.

Randy Wootton (20:21):

Ah, hence your training.

Rob Brown (20:23):

Not so much my training. I'm not in the training game anymore, and there are plenty of good coaches, consultants, trainers out there. But to the point, you will never meet an accountant that has time on his or her hands. These are super busy people and they're really overwhelmed. There's tax deadlines, busy season, you've heard of that phrase before.

(20:42):

So where accountants learn this stuff is in their discretionary time. Often they've got to do it on their own. The main professional development they do, the CPE that they continue professional education ... We call it CPD in the UK development. Where they learn that is the mandated stuff, the changes in tax regulation, keeping their qualification up to date on the technical side. Beyond that, the learning skills on the job. A little bit of coaching here, mentoring there, learning it as they go along, making mistakes. You send people out of an office and make them work remote, they're now not rubbing shoulders with people in the corridor saying, Hey, how are you dealing with that or I have this situation. So driving culture and change and informal mentoring is really, really difficult.

(21:29):

Now, the formal training, getting accountants on sales programs, on commercial awareness programs or making them do an additional qualification that develops commercial awareness or entrepreneurial business sense or people skills or leadership, they don't have the time for that. They don't really have the inclination for that a lot of them. They are getting paid very well, doing what they're doing. They're super busy doing what they're doing. All accounting firms are growing. So where is the incentive beyond that intrinsic motivation to do better, serve better, add more value for them to take up their spare time in acquiring all of these new skills and attributes?

Randy Wootton (22:12):

Well, just going back to your earlier point, I would think there's a couple of things at play. One is the overall value and price that people are willing to pay for the traditional compliance work is going down. And that's a bidded environment. And so number two is, I think you see, especially with ... I know client advisory services has been around for 30 years and people are still trying to figure it out. But I've talked to several firms that are really embracing this idea of CAS and the idea of doing a retainer. So not just doing time and materials. So setting up to be ... And if I do a retainer with someone like I do with an agency, a marketing agency or a consultant, the expectation is there's value being delivered on a regular basis though it's not a piecework. It's not I'm paying you for an audit, I'm paying you for your advice.

(22:59):

And if there's fewer accountants, people coming into the accounting profession, they're not going ... And I think the other thing we haven't talked about obviously is I think AI is really going to impact accounting. It's going to make the job, the dotting I's crossing the T's, the compliance easier. You can get to a zero-day close, for example I think using AI. I think you can use AI to help you better understand what's happened. And so you don't need the work and time focused on getting the dotting the I's and crossing the T's, producing the reports. Now it's all about the value add.

(23:36):

They may be getting paid well now for what they're currently doing, but if they're early in their career and want to move forward, they're going to have to transition in terms of how they think about what they offer their clients. I'm coming obviously from 25 years in technology. I think it may be different in other industries, manufacturing, retail, your mom and pop shop on the corner. But if you're the accounting firms or you're an accountant one and making that transition into the commercial sector to be on the client side, I do think developing those skills is a critical ... There's a clarion call to take it on.

Rob Brown (24:08):

No question. Randy. You are in a fight for relevance.

Randy Wootton (24:13):

Yeah. That's right.

Rob Brown (24:14):

Let's speak to AI for a moment. The compliance trap, time sheets, billable hours, everything else. There is a move away from that. It's slow. It's very glacial. Accountants have done it their way for centuries. But the automation, the AI will help in making compliance work easier. And that will free up some accountants to take on more advisory roles, which actually is actually what they love doing by and large. They don't position it well, they don't package it well, they don't price it well, but they're moving into that space and they know it's an inevitable transition. However, if I were to say this to you, only 30% of accountants automate a bank feed. That speaks to what impact AI will have. So say two thirds or more of accountants are not tech-savvy enough or have the wherewithal to get an automatic bank feed coming in to reconcile day zero close as you said. Why not? Because they're on desktop, some of them. Some of them are still working with checkbox and shoe boxes and Excel spreadsheets. It's an old profession.

(25:26):

So you're telling me AI is going to change the game? It might but it won't be anytime soon and it won't be with the rapid impact you expect. There are some great early adopters out there, but there's not a lot of them in accounting. There are some on the real bleeding edge that are doing AI stuff and really making it count and some of the software vendors to accounting are folding it in. But honestly, it's not going to be the massive game changer everyone thinks. And if it does, it will take up some of the fallout from people leaving accounting. It will pick up some of that slack, the attrition. But if you're asking what's going to change the game, yeah, it is going to be those accountants that say, I really want to move up the value chain. I really want to be more relevant. I'm going to invest in my skills, invest in my professional network, invest in my reputation, invest in my commercial awareness, invest in my leadership skills, and they will have the most opportunities and the biggest money.

Randy Wootton (26:26):

Great point. I think it's a nice segue to the conversation why PE firms are buying accountantcies. I think that there is this interesting ... Part of the reason I moved from AdTech Martech into the office of the CFO was because I saw the revolution workflow automation and what it did for marketers and sales people and service people. Now there's north of 12,000 vendors in the marketing space. It's a frothing battle to sell the next new cool marketing tech. But I think the office of the CFO hasn't yet faced that revolution. And to your point, with a bunch of companies doing things manually, that seems to me like that's ripe for PE to come in, roll up services, drive efficiency, consistency, global talent. So if there's not enough talent in the UK or in the US. I know for example, we have some accountants based out of Manila in the Philippines that are supporting us in our field. And so taking advantage of the global talent market. What are some of the things you think are driving PE buying up firms at this point, or how's that playing out from your perspective?

Rob Brown (27:35):

Well, private equity people are super smart. We know this. They look for opportunities. They look for uplift and profit. So they must be looking at accounting firms and seeing inefficiencies. They must be seeing money left on the table, otherwise they wouldn't be coming in for accounting firms. And they're coming in for SaaS firms too. A lot of the technology ecosystem that supplies accounting firms now is owned by private equity. So the big play is that there is money to be made. And accountants, the billable hour, they're not value pricing very well. They're not doing advisory very well. They're not doing subscription pricing very well to your earlier point and retained services. So private equity is seeing a whole new way of setting up the firm, moving away from the partnership model towards maybe a C-suite model. Accounting firms being run by non-accountants, the same as some schools are being run by non-educationists.

Randy Wootton (28:33):

Yeah. I think there's a lot to the business model. I think there's this idea of how do you take a service firm and turn it into a tech-enabled service?

Rob Brown (28:40):

Yes. That's a good way to put it.

Randy Wootton (28:42):

So to your point, you have a hundred pieces of software, they're not using it and deploying it. Well then that's a waste of time and money. But how do you create a tech stack that then the services firm used to be smarter? And then to your other point, you can have a tech enabled service firm that's AI powered or augmented intelligence. How are they leveraging the best? And I find this at my firm, every single ... Firm. My company. Every single function is thinking about how AI changes what they do from sales to marketing, to support, to development, to finance. It's how are you using the tools that are available now or how do you build?

(29:21):

I think that was your second skill around technological savvy. Part of this is working into this new world. The world is different post-ChatGPT, and I know this because I was a CEO of a first gen AI company where it was a huge ... We invested an enormous amount of money in our own servers. We had 30 data scientists on board. We had 30, 40 people that had to deploy the models that we were building. We had 20-something models that we were updating every day. But the cost to engage at that level and have a predictive analytics, logistic regression analysis type analytical models was so cost prohibitive that people couldn't do it. Today with ChatGPT and all the other user interfaces that are available, everyone needs to embrace and be playing with it.

Rob Brown (30:09):

You touch on an interesting point, Randy, if I can just jump in.

Randy Wootton (30:12):

Sure.

Rob Brown (30:12):

Accounting firms and accountants finance people are not good at buying tech strategically. So you spoke briefly to there's many legacy platforms and you buy this piece of software because it does its job, but it doesn't necessarily serve the client best or it doesn't fit in with what we've already got, but they don't join the dots particularly well. So maybe private equity has seen that as well as streamlining our conformity or joining the software stuff together in a much better way or buying software services and products and platforms in a much more cost-efficient way. That's pleasing.

Randy Wootton (30:49):

I think you're right. And that'd be a great way for us to shift to the next part of the conversation. You opened with ... Or it was in our pre-brief that you said that accountants were the second most sold to profession outside of doctors. Maybe you can help us understand how do you sell to accountants? How do you be relevant? How do you make it successful? Obviously at Maxio we're trying to sell to ... Well, we are selling to accounting firms as well to support them in their BPO and their client advisory services. That's a channel that we're building. Our primary channel is direct to CFOs who have been accountants, so they have that same orientation. Can you maybe talk a little bit about what you've seen in terms of the evolution of how to sell to accounting firms successfully and accountants?

Rob Brown (31:33):

Yes. Accountants are the gatekeepers of business because every business pretty much needs an accountant. Let's go back to the doctors. You can imagine how every pharmaceutical company would want a conversation with a doctor because there's a lot to be sold there with the drugs and the medical stuff that's required. Same with an accountant. All the software vendors want to get to an accountant so that the accountant uses their stuff, but also the accountant becomes that advocate, that introducer, that affiliate, that referral partner to all of the businesses that they serve. So the average accountant ... And goodness, what is an average accountant? But they'll be getting hundreds of emails a week on, can we have a conversation? Let's chat about this. There are some opportunities for us to work together. I think our solution might really help you. Our software will really help your business clients do this, and we can really help you do this. So they're bombarded by sales messages. They're hit up on LinkedIn every day. Not many accountants are on social so LinkedIn is the de facto place where you might get them.

(32:40):

But then there's all kind of nuanced marketing campaigns. I'll give you an example. Intuit, they're a big player. Intuit QuickBooks. They'll sponsor the Super Bowl or do something ridiculous like that just to get the attention of accountants. Why did Coke spend two billion a year advertising Coke? Because everyone knows Coke. Well, it's this drip, drip, drip of stay in front of mind. Anyway, there are three ways you get to accountants. So we've acknowledged that accountants ... You're right. If you can get a relationship with an accountant and they trust you and they like you and they see the value you can offer their client-based business owners, you will have a great advocate there. But actually while we're on that, accountants are so busy with their own business, do you really feel they've got time to mention your business as well? So think about that for a moment.

(33:32):

But in terms of getting the attention of accountants and getting above the noise, it's extremely difficult. You can do it three ways. The first way will cost you a lot of money. The second way will cost you a lot of time. And then I'll mention the third. So the first way is to throw money at it. If you have an unlimited marketing budget and you want to get the attention of accountants, you can pay for all the pay-per-click and the advertising spend and sponsor the Super Bowl and go to all the accounting conferences and you show up everywhere they do. Everywhere you go, you are there and that will cost you millions. If you've got a budget like Nike, you can just do it and be everywhere and it'll cost you a ton of money.

(34:14):

You can go down the second route, which is the organic route. So that's content, thought leadership, social media posts, drip, drip, drip. Won't cost you as much money, but it will take you a long time. Because are accountants looking at that? And the average duration for a social media post is 48 hours. After that, it's gone. It's disappeared. No accountants are really looking at that. Podcasts maybe have a longer tail where accountants will go back and listen to older episodes, but most marketing methods are very instantaneous. And if you don't hit it, then it's gone. Social media, you can write content, but there's a lot out there. A lot of it's rubbish. Are accountants really looking at that? Is that how they're learning? Is that how they're taking on new information? Is that how they're staying informed? Possibly not. Whose life was ever changed by a social media post or a blog post or a PDF or a white paper? Not many.

(35:13):

So that second route, it's a slow burn. The third route to get to accountants is strategic partnerships. Now, there are a few different ways to describe strategic partnerships, but effectively it's build relationships with people that have big audiences of accountants. So build commercial alliances with people that hold databases, email lists, customer bases, client bases, audiences, communities, followers, fans that are accountants. Here at the Accounting Influencers Roundtable, we do that. We bring in software companies, tech companies, consultancies, coaches, trainers, podcasters. They all serve the accounting profession. And you know what? They've all got a list of accountants, big, small, medium. If you build relationships with people like that, you then start to have conversations about, well, who are you working with and who are we working with and could you maybe introduce me to them and could you get me a phone call there? And it's more of a warm introduction. Now that again is a slow burn, but it's trusted. It's accelerated because you've got a warm introduction. So somebody's advocating for you in going to their accountants that are super sold to. We've established that.

(36:32):

But you go to an accountant that you've got a relationship ... And Randy, you have some great relationships with accountants at Maxio. So you would say to them, Hey, I know we've been together for a long while. I trust this guy. I think you should really have a conversation with him. They would take that call. That accountant, that CPA would take that call because you told him to. So that's a strategic partnership. So building them, there are lots of different ways to do that. There's alliances out there and communities that you pay to get exposure to their accountants and have a seat at the table with their meetings of accountants. It's doable, but it's noisy. You're fighting for attention, you're fighting for relevance, you're fighting for air time. And it's wading through treacle sometimes. And trying to be innovative ... Accountants are not innovative. They might buy bright shiny things, but honestly, they will go to what they know and they'll go to what they're familiar with. They're very risk averse. They don't take many chances as you would expect. They're not early adopters. So you've got a battle on your hands, but it's doable. What you can't afford you have to do is be bland and just make more noise.

Randy Wootton (37:43):

Yeah, I think you're spot on. Just resonates on a bunch of levels. In terms of one being a relatively large company of 2300 customers, we do have some money. So we are focused on marketing. We are trying to get in front of people of the digital, but we can't afford the big events. We can't afford the Super Bowl so there is always this balance between how much of your marketing program spend are you spending on paid media versus the number two, which is around the social posts and the content. And I think to your point, they only are up for 48 hours. What you're trying to do is hook someone. Hook them to come to your site and then do a little bit of an exploration.

(38:19):

I do think one of the things we've been exploring, which is unique to the accounting profession is the idea of CPE credit. And we're working with a company that's helping us take our webinars and some of our other shows, like even the podcast and convert it to CPE because every accountant in the US need to be in credit. So if you can have relevant, interesting, fun content that they have to take, then you're aligned with their incentive and they start to get to know your brand.

(38:43):

I think you're spot on with strategic partnerships. That's one of the things that we invested in over the last 18 months is finding those influencers out there. Ben Murray, the SaaS CFO, Ray Rike, the CEO of Benchmarkit. CJ Gustafson who runs metrics that matter. There are people out there that have a bunch of accountants and CFOs and others follow because they're writing good content in their trusted brands. And so how do you establish those partnerships and getting the balance right?

(39:13):

We've talked to the AICPA, we've gone there, and what we found at the AICPA for example, is there are very few firms to your earlier point that are actually on the cutting edge of wanting to take technology and move to this new business model around subscription-based services and adding strategy. So the long tail is probably not a good set of customer's prospects for. So I think really understanding what your value prop is, and of those 60,000 accountantcies, which ones are you going to serve? Offering something for a single proprietor is very different than trying to support the big four. And so trying to figure out where you fit in the middle.

Rob Brown (39:48):

Here's another angle to that, Randy, you make some great points. If I introduce you to an accounting firm with your product service solution, there might be three, 400 people, 30, 40 people, three 4,000 people in that accounting firm. So who do you want to talk to in that accounting firm? Because you've got myriad of different roles, a myriad of different seniority levels, a myriad of different passions and areas of expertise. Accountants work in different sectors, different verticals. So getting an introduction to a firm doesn't necessarily work because is that the right person? Is that going to be your champion? You're looking at multiple levels of advocacy and trust and being passed on down or across the line to the right person that will ultimately buy or endorse what you're selling.

Randy Wootton (40:44):

Yeah. But we've seen this a little bit play out in VC and PE firms where they have investing partners and then they have operating partners. And I think as accounting firms start to embrace technology, consolidate technology and say, Hey, here's our tech enabled service, here's the stack we're going to use there will be people within the firms who are going to be the primary gatekeepers to vendors like us, software selling to them.

(41:05):

Last point I just wanted to cover off. I think you're spot on with this fear of messing up versus fear of missing out. And there's a great book called Jolt, which is produced by the same folks that produce the challenger sales method, which is my go-to sales bible forever. But what they found as they evolved their research was that a lot of people end up in this area of uncertainty, and it's not driven by fear of missing out, it's fear of messing up.

(41:35):

And I think that's especially true for accountants and CFOs is they don't want to get caught making the transition from a general ledger or to a new financial reporting system and then have it be wrong. And they're comfortable in their current Excel model because they built the model and they know every single assumption and they know every single formula and how it connects between the hundred tabs. And they at the end of the day know if they push the wrong button, it's their fault. But relying on a new technology, relying on a new way of doing things, I think can really help them ... It can feel threatening. At least that's what I'm finding, which it's very different than-

Rob Brown (42:11):

That speaks to the risk averse nature of accounting. They have to get it right. It's a binary right or wrong often. Some gray areas. But yeah, they hold the line. The buck stops with them. Take off outsourcing for instance. We hear that this is a solution for accounting firms and really any businesses that want to lock into a global workforce. If you go down the outsourcing offshoring route as a representative of your accounting firm or your organization and you get that wrong, you go to the Philippines instead of India or you go to South Africa instead of wherever else, there's a lot of risk on you. Their reputation is at stake. Same with AI. You want to bring an AI tool into your firm, you better be absolutely 100% sure you've got the right, otherwise you're fear is messing it up. So any change, any adoption, any tech solution, any hire comes with liability if you're not careful. And you can do due diligence until you're blue in the face, we still get it wrong don't we? And accountants are, you're right, very fearful of that, which is why they try and play it safe.

Randy Wootton (43:26):

Yeah. And I think to your point, I think one of the big challenges with AI right now and ChatGPT in particular is the potential hallucination. And you can't have a hallucination on your financial statements.

Rob Brown (43:38):

Well, there's the data security as well, Randy isn't there? What you put out there in the public domain that has repercussions.

Randy Wootton (43:46):

I think a lot of people are actually working towards with company confidential information and having the AI powered within their own system, trained on their own corpus of data. We for example, have 2300 customers. We have about $15 billion of billing and invoicing data going across the system. And as we're looking to incorporate AI into our own systems and models, it's using the model within our constraints. So I think that's one of the things all those providers are working on. They benefit from having aggregated data, but they know that they need to take models in specific situations, have them custom-built. That's what I did at Rocket Fuel. We had 25 models, but it also was $250 million of investment to do that and took 30 data engineers and data scientists to build it.

(44:27):

Well, Rob, we're coming up on time. Sorry. I meant to tell you this at the beginning. I have a speed round. So the speed round are three things. One, do you have a favorite book? What's your favorite book? Other than yours, which I didn't know you had written. I'm going to take a look at it. I think it's great. Build Your Reputation. So it has to be something other than yours. A favorite metric. So what metric when you are working with business in particular or accountants that you think they need to focus on more than anything else. And the third one, to your point around strategic partnerships and finding people who have relationships. Who's your favorite influencer? Like on LinkedIn, who are you following? Who do you look at when they make a social post? What comes to mind? You can pick one or all three of those? What would you like to start with?

Rob Brown (45:15):

Let's start with the book that's had the biggest influence in my life, which is-

Randy Wootton (45:20):

Sure.

Rob Brown (45:21):

And I'll confess, I don't follow what this guy says like I should, but it's Cal Newport's, Deep Work.

Randy Wootton (45:29):

Deep Work. Okay. What's the premise.

Rob Brown (45:31):

By Calvin Newport. He's a computer scientist and he's written a lot of great books. He has a podcast as well. I don't listen to the podcast because I don't have enough time to listen to many podcasts. I was really profoundly hit when I discovered that his book, the ultimate message is the world will belong to those people that can focus for an extended length of time on very meaningful work.

Randy Wootton (45:59):

Hence Deep Work.

Rob Brown (46:00):

Hence Deep Work. We're so fragmented in our attention, we're so easily distracted, we're so quickly interrupted and developing the muscle strength, the focus to stay with it on deep work and block out distractions. That's what Deep Work is about. So I tried to encompass that and sticking with task. It's not easy. In the social media world and everything we're looking at. So I'd put that.

(46:30):

In terms of metric I am in a stage in my life having had a bleed on the brain, a brain hemorrhage where I count my blessings. Now, this is not going to be a counseling speak I'm giving you right here, Randy, but I'm still grateful for many things. We're all contending with something. We've all been through stuff or we're going through stuff. So I keep a little journal of good things that happen in my life or stuff that I'm grateful for.

Randy Wootton (46:58):

Oh, that's great.

Rob Brown (46:58):

I'm not allowed to drive. I take medication for epilepsy after my stroke. But I'm so thankful that I'm still in the game and can still do some things. So I have a little journal where I log things that I otherwise would forget. I'll stick this podcast in it Randy, because it's been fun. And another thing, things that happen with your kids and your clients, had a good day at work because, and went for a lovely walk or this happened or whatever it is. So that would be a metric. Is to just be a little bit more conscious of the good things that you're grateful for.

Randy Wootton (47:31):

Being grateful. That's a great way to have that ... Be ever-present for the grace around us and the joy of living and just, it's better to be vertical than otherwise.

Rob Brown (47:45):

Absolutely right. Growing old is not something that everyone gets to do.

Randy Wootton (47:53):

Yeah. That's right.

Rob Brown (47:53):

God promises tomorrow to nobody. I'm a committed Christian, but you get that sentiment there that we don't know what's coming up. So let's not let tomorrow's worries rob us of today's joys. You know that phrase.

Randy Wootton (48:06):

Oh, I love that. I love that. All right, well then influencers. You clearly have covered a lot of territory, so I'm not going to limit you to accounting influencer, but who are you following on LinkedIn that you think is writing good stuff?

Rob Brown (48:19):

You know what, Randy, this is going to surprise you, but none.

Randy Wootton (48:25):

Really. Okay.

Rob Brown (48:27):

There's so many different ways to define an influencer. There's a lot of people that make a lot of noise on social media and they look popular and they have thousands of followers, but their content is lousy. It's lame. It's unoriginal. It's not innovative. They've regurgitated it from other people or they've said the same thing for years. So there's a lot of that. But you would look at them and think they're influencers. There's also a lot of people that blow hot and cold. They get an idea and they run with it. And then for six, 12 months you don't see anything of them. So I measure influence by relationships rather than noise and social media metrics.

(49:10):

I'll give you an example of somebody that's got a really good reputation in the accounting world that is super well respected. He's been around a long time. He doesn't put out a lot of stuff that you would see him as influential. He's called Randy Johnston of K2E, and then MGI. He's written most of the software for most of the accounting firms in the US. He's dealt with most of the top 100 firms. Randy Johnston. High integrity. Everything he says has merit and has weight and has gravitas. He's got a really wonderful way about him. Now, you wouldn't necessarily view him as an influencer because he does a lot behind the scenes, but he powers a lot of engines, if you like.

Randy Wootton (49:58):

That's making impact. So influence versus impact. Who's actually impacting firms and people and how they think about things and do business?

Rob Brown (50:05):

That's a good way of putting it. Who's moving the dial? Because influencers generally do not change behaviors. Influencers don't change opinions. They should do, but they don't. Influencers tend to just echo what's going on out there or their comment on what's going on out there. And they're not true influencers in that they're making think, Hey, that's different or that really makes sense. So there isn't one.

(50:32):

There are little quotes here and there that you hear from different people and you think, I like that quote. Just like if I asked you to put together your top 10 songs, they wouldn't be from one band or one artist. You'd like that song from that person and that song from that person, and that would give you your top 10. So there's quotes, there's thinking, there's frameworks, there's models, ideas I like from different people. But there's no one that is really rocking my world to your point.

Randy Wootton (51:00):

Okay. Well, I love the distinction you're making between influence and impact, and I think you're probably right. I got caught up in the influencer game as well. In part because of what you were describing as your third way of getting to accounting firms is through strategic partnerships. But I think the distinction you're making is around authentic relationships versus followers and people that are making an impact versus just providing influence. And that's a really powerful one. So thank you.

Rob Brown (51:28):

Possibly. I heard a lovely phrase recently. What would you need to do in your life to have a crowded funeral?

Randy Wootton (51:36):

Yeah. Yeah.

Rob Brown (51:39):

That speaks to impact and influence doesn't it? It speaks to what are people are going to be left with after you've gone? What do you leave-

Randy Wootton (51:47):

Yeah. And I think it speaks to how do you invest in authentic relationships? People will show up at your funeral if they feel like you valued them and have been a positive influence and made an impact in their lives. And that just may be, Hey, you're a good person who shows up and makes their life better each and every day to your earlier point around what brings you joy.

Rob Brown (52:08):

Yeah. Well, that's been a wonderful conversation Randy.

Randy Wootton (52:14):

It has Rob. So thank you very much for your time. I wish you best of luck. If people are trying to find you, they can find you on LinkedIn. Also, your Accounting Influencer Roundtable is something that you're hosting and facilitating. Again, I participated in one. I thought it was great. And as you say, hey, join the conversation and joining the conversation around building relationships, authentic relationships with people that are interested in this profession and where it's going. So thanks for your time Rob.

Rob Brown (52:38):

[inaudible 00:52:38] for your audience, Randy. Accountinginfluencers.com is where that is at. The whole point of being relevant these days is being in the conversation. You don't want to be on the outside of it looking in. You want to be in the middle of it letting people know what you're doing, what your message is, what you're thinking about. And this curiosity in the world where we do want to look over the garden walls of our neighbors and see what they're planting and what they're doing, or I want to look in Randy Wootton's bait box to see what he's using to catch this or Randy's medicine cabinet to see what he's taking for that. That's where relationship-

Randy Wootton (53:12):

There's a lot of high cholesterol, high blood pressure-

Rob Brown (53:14):

And there you go.

Randy Wootton (53:15):

Gout.

Rob Brown (53:16):

There you go.

Randy Wootton (53:18):

Well, Rob, thank you sir.

Rob Brown (53:19):

Thanks Randy.