[INTRO]

[00:00:01] ANNOUNCER: Welcome to Branch Out, a Connection Builder’s podcast helping middle-market professionals connect, grow and excel in their careers. Through a series of conversations with leading professionals, we share stories and insights to take your career to the next level. A successful career begins with meaningful connections.

[INTERVIEW]

[0:00:20] AD: Tim, welcome to the Branch Out podcast. Looking forward to our conversation today. 

[0:00:23] TK: Thanks for having me out. I'm really looking forward to our conversation as well. 

[0:00:27] AD: I'm going to talk to our listeners for a quick moment here to tee this up a little bit. Tim and I have known each other for about a year. I think we originally met back a little over a year ago to conference and have seen each other in a number of conferences since, and stayed in touch and had some conversations. Tim has recently made a career transition, if you will. He'll share a little bit about that, but I thought that there was a lot of uniqueness behind what the career transition was, what you're setting out to do today. 

Also, your general way of thinking as it pertains to professional services and ultimately how to grow that. That's the context for what we're going to do this conversation today. Tim, maybe just to lead us off, why don't you share a little bit about who you are, what your journey's been, and what you're doing today. Then we'll dive in from there. 

[0:01:07] TK: Thanks so much, Alex. It was a great introduction and really happy to be here, like I said before. My name is Timothy Keith. I'm the CEO and Founder of Propense.ai. We're an AI cross-selling platform that helps professional services firms grow more efficiently from the individual professionals, but also as holistically as a firm. 

My story is very unique. You really can't connect the dots going forward. Honestly, it's a very unique side. I don't really come from the professional services industry at all, but I got involved around seven years ago when I was tasked with implementing CRM at a professional services firm, large scale professional services firm, and fell into this space and understood a lot about the industry, understood about the pain points and have been dead set in solving this issue for I would say, almost coming up and on a decade, that's why I made this jump here. 

I was more on the CRM consulting side before, and I was a former founder. I built a note-taking business right out of school, but at the end of the day, that's where I started, right? I always said that once I did that, if I found a problem that's worthy to solve, I will jump in. I think I'm one of those people that likes hard problems, like very difficult problems. I don't know if that's a good thing. I used to pick the hardest tasks, used to pick the hardest video games growing up. I don't know, even if I couldn't solve it, I just love the challenge. That's where I am at today. 

[0:02:25] AD: You're entrepreneurial. You like big challenges with unknown rewards at the end, right? That's the –

[0:02:30] TK: I don't know if it's considered entrepreneurial, or if it's – I just like pain, or I like discomfort. I don't know if it's all above, but maybe that is entrepreneurial. I guess that's the best way you're putting it. 

[0:02:41] AD: I like it. Let's start with talking about implementing a CRM. That was, you said, that was some of your start. I obviously formed and shaped some of your thinking, going forward. Just walk us through for anyone, and not to get in the nitty gritty details, but like, what was that process like? What did you uncover? What were the problems that you started to see as you went through that process? 

[0:02:58] TK: Yeah. It's a really good question, because it's like, there's two questions, right? There's implementing a CRM. Then implementing a CRM for professional services firm. They’re totally two different answers. 

[0:03:08] AD: Getting people to use it. 

[0:03:09] TK: Getting people to use it, right? My story really was, I was a consultant a long time in implemented CRM, a lot of times for a lot of different industries. Technology, advertising, consumer as well. That's actually my first job. Working in professional services was taking on a job to implement a CRM. I had a professional services firm, Kaufman Rossin in Florida at that time, top 60 firm right now. 

When I interviewed there, it was a great organization, one of the best companies I've ever worked for. They flew me down, met with the entire executive team, met with my boss at the time, Janet Altman, the Marketing Principal at Kaufman, Rossin. Amazing person, an amazing person to work with, a genius in a lot of different ways. I remember meeting with a major partner, Blain Heckaman. He basically said, “You've got the job, but you just need to be very, very patient with us.” 

I didn't know what that meant at the time, because I didn't understand the professional services industry at all. When you answer that question, I'm going to go a little depth there. It's typically for organizations, and this is what I didn't know until I jumped into the professional services side and implementing CRM. Typically, 99% of organizations, it's followed by the C-suite. When you think about CRM, it's built for the C-suite. They want everyone to be accountable, they want their pipeline, all the data there. 

Professional services for accounting firms, for law firms, they don't follow that model. They follow the partnership model. When you really think about professional services firms, it's not necessarily built for the C-suite. It's built for individual companies as a holding company there. CRM is organically incongruent in the professional services space, naturally. Because when you really think about CRM for normal businesses, it's built for the C-suite. They really want the pipeline reports, they want the sales reports, they want all the metrics in professional services. 

[0:05:00] AD: It's one specific cohort of folks that you are targeting. One target group where you can be more prescript behind, here's the pipeline, here's the process, here's the – for reports and dashboard that we look at versus what you're describing as the dispersed element, right? 

[0:05:17] TK: Exactly. Exactly. Also, you got to think about the infrastructure, how it's built. It's all built with that end goal of that, the report for them to monitor their business. But in the professional services space, it's all about everyone individually building their book of business and the collective whole gaining from the book of business being built. When you think about that from a behavior or psychological perspective, CRM is really built collectively for enterprises, but for the professional services space, it's really individual-driven managing your book of business. 

Why I say that is, implementing CRM for professional service is a very, very challenging process because of those factors. One, the partnership model, the rear current business model where a lot of the business comes rear current versus proactive, the behavior of the nature of the way people work, and which is very unique, quite frankly, it shouldn't change. Because you want professionals to be able to work with their clients and spend their time meeting with their clients throughout their process. 

[0:06:16] AD: There is a clear difference in the end use and how it ultimately has to be put together. You mentioned behavioral elements of this. How does that play out in the use case? Ultimately, where and how a CRM or a data system that ultimately drives value for building the not only the individual or the group's book of business, ultimately the firm, the collective, the partnership as a whole? 

[0:06:37] TK: Yeah. Most CRMs that I've been a part of are not in the professional services space, it's more about new business. It's more about growing out to new markets, collecting leads, running through the funnel and converting those leads into clients. Professional services space, the CRM's that I've been a part of that have been effectively, it's the opposite, it's high eccentric. Because when you think about the professional services firms, how they grow their business typically, obviously new business is a big part of that process, but most of the growth comes organically. 

I always give a good analogy of a doctor. How the doctor grows his book of business. A doctor usually goes to the book with urgency. He has one client, he does really good work with that one client, they refer him in different businesses. “Hey, I have this doctor. His name is Tim. He's great. You should go meet with him.” That is the difference there in the value proposition. There's a lot of synergies between the two, but it's totally different in the way the value output of your client-centric versus new business, which is 99% most of the rooms outside of this secondary are. 

[0:07:39] AD: Two things I want to hit on that you said there. One, when you use a doctor is a good analogy, which I completely agree with. What do we call doctor's offices? They're practices, right? They're part of a practice. What is a firm ultimately? It's a practice, there's practice groups. And understanding that it is – it has everything to do with to your second point, it's very client-centric. It's about that relationship, it's about knowing where and how you can add value. One thing, and this is – I don't have deep background experience here, so I'm saying this more as a question to you than anything.

But if you look at traditional sales organizations in a traditional way of implementing and utilizing a CRM, you have a handful of specific products or offerings that you can really narrow down and say, “This is what a buying decision looks like. This is what the pain point is. Here's the exact steps and here's what my widget looks like when it's sold.” Versus in professional services, oftentimes it's – you may have a specific offering or a specific service line that you're trying to push through, but many times, especially now as firms are evolving more and more into advisory, you have a wide breadth of services. There's everything from audit tax to the compliance type work to whether it be fractional CFOing or whether you're doing transaction advisory or wealth management or estate planning or – The list goes on and on and on. It's consulting, it's advisory. 

[0:09:04] TK: It's so much. That's one of the biggest pain points, right? Because it's not only that, there's so many services that these firms offer. It's funny, unless you're in this space, you think it's, “Oh, accounting firms, legal firms. That's just when I want to get my taxes done. I just want to get my audit done. That's when I just have a case I have to go through.” No, they're the backbone of the entire economy. These accounting firms now do everything. Cybersecurity, insurance, employment benefits, advisory services, risk advisory. There's so much. There's so many services that each individual person at the firm can't name all the services they offer. It's impossible to. Nobody would be able to.

What makes the problem even more complex is each individual at the firm is an expert at one, right? If I work for this firm, I know tax really well. Not even know, I just know tax, I know SALT, I know SALT really well. That's literally my expertise. That's what I do every day. That's all I do, so there's no visibility of what I should be doing. And that's really where it got to this problem, is there's so much money being left on the table by not having that visibility and transparency, and that's a lot later into cross-selling and how I started to think about it. 

I even know what it meant when I first worked for an accounting firm. I remember I was in a room, and I was saying, “Hey, yeah, cross-selling is mine. I sell more tax services than I'm a tax director.” Janet was really nice, she said, “Oh, we define it a little bit differently.” But that's what makes the problem so complex. Even beyond that, is in the professional services, when you get into that arena, you get into the arena because you're an expert, right? It's usually, somebody has a problem you go to the professional service to solve that problem. It's very reactive versus proactive and just searching for the problems to put yourself out of the comfort zone. 

[0:10:48] AD: I want to take our conversation next into the whole realm of cross-selling, which is really where I want to hone in on here, but before diving there, you said two things that are important to tee this up well. Number one, you just said it very clearly that it's often an unknown problem. It can be something, it can – someone may have a pain point, but they don't necessarily know the specific solution, that the client being the prospect. 

There might be something out there where it takes a little bit of discovery, a little bit of question asking and thoughtfulness about understanding the industry, understanding the client, and understanding how to properly position the offering you have, becomes value additive for that prospect, that existing client, however, whoever it may be. That does make it a little bit of a – it is unknown, it takes some strategic thinking, if you will. Some information, some knowledge and understanding about the specific need to really – to be very successful in that. 

Then what you said on top of that. I'm going to use your SALT example. For anyone listening that doesn't know SALT. It's State and Local Tax. You are a practitioner, a CPA, that is an expert in understanding that the state and local level taxes. To your point, I may be working, I could be a SALT expert that is working. I might even be a SALT expert in the state of New York, for all it matters. You could be very niche down, but if I'm working with someone, and I’m a SALT professional, I may not really understand that they need an ERP solution implemented, or that they are doing a M&A transaction right now and need some post-closing balance sheet work, or transaction due diligence, or my whole, my expertise, my purview of how I look at the world is SALT, so I'm focused on their taxes, but I have that relationship. 

I'm talking to the CFO, I'm dealing with the controller on a day-to-day basis, and during a conversation, the CFO mentions, “Oh, we've been thinking about implementing a new system to help manage our operations better or we're currently going through an M&A transaction.” That's those opportunities rearing their head, right? That's the, “ideal element” of where you're doing a service already. The person doing it probably doesn't know much outside their limited scope of expertise, but somehow through that, you uncover an opportunity, whether they mention it to you, or you're just proactively thinking about that. There's usually more ways you can help that same client, that existing relationship. Is that a fair way to tee up this concept of cross-selling? 

[0:13:06] TK: Precisely. I would even take it a step further. A lot of times that I hear from clients all the time is, they talk to their clients, they're like, “Yeah, we just implement our ERP solution. We are using another accounting firm, another consulting firm to do that.” We’re like, “Wait a minute. We do that.” The client's like, “I didn't know. I didn't know you guys did that. We just brought up to you guys, I really just didn't even know, because I have no idea.” It's twofold, right? Because, well, and there's a misunderstanding what these firms really are now.

If they're branded as accounting, branding as professional service, branding that the specific practice area firms, I guess naturally you think that's what they're used for, right? But there really are advisors for the entire enterprise business of up with economy. I guarantee more times than not, anything you want from a professional services side, you can ask your accounting firm, your legal firm. If they don't know it, they'll pass it to somebody else, but it's twofold. You're precisely right. You're precisely right. That's what the problems of complex, right? It's a twofold problem. It's the fine side, and also the individual side. We eloquently dive into why that is an issue, and why that's really what I've been trying to solve for as I go on this journey. 

[MESSAGE]

[0:14:23] ANNOUNCER: This is Branch Out, a connection builders podcast. 

[INTERVIEW CONTINUED]

[0:14:32] AD: Let's talk about how do we solve it. I know you have a specific product offering that I want to dig into. Let's talk about the high level. What needs to be solved, what are the macro challenges that get in the way of that being successful oftentimes? 

[0:14:46] TK: I would start - there's a lot of different factors to it. There's the different profiles of the people that work with these firms. There's the young professionals. There's the young partner. There's the seasoned brain maker. There's a technical partner, and a different one will interact with cross-line a little bit differently. When you look at firms mostly, there are people at these firms that have been very successful with it, but it's just a small percentage. Like usually, there's 5% of the company or the firms that I work with are rainmakers, and they break upwards to 60 to 70% of the revenue alone to those firms. 

They're doing something that nobody else is doing. There's a figuring out what that's happening and educating the visibility. There's accountability aspect to it, too. A lot of these firms on the partnership model really, there really is changing now with private equity coming in and a lot of different factors coming in where things are getting a little bit more, like other enterprise businesses. But like I said before, new business growth really wasn't something that was, “Hey, we need to get this done. We're not having pipeline reports. I have a sales report.” There's all incentives behind it, too. But at the end of the day, it really comes down to being accountable and measuring it and having a process behind it to start there. 

It depends on how mature the firm really is and how large the firm is, and there's different layers to it, but it really comes down to, “Hey, what's going on here? How do we make this better? Let's educate. Let's create a process in place. Let's invest. Let's innovate.” There's a lot of tools out there that help this better. That's why CRM, that's why the investment in CRM is across the space, because everyone knows the way to grow accounting firms, professional services firm, legal firm, the easiest way with the highest margins is cross-up, and it's not even close. It's not even close. 

Why all the M&A activity happened over the last year or two? Was because they wanted to buy additional services. They wanted to buy different locations to sell their services more efficiently into these areas. Quite frankly, it's just money being left on the table. It's a significant amount of capital. If they actually just be honest with themselves, do I really want to do this? Everyone agrees. It's not like everyone says it and talks about it, but we need to have an honest moment where they're saying, we know we're not going to change the behavior unless we force it, right? That's really been the shift and an issue right now. 

Before the last probably 20, 30 years was, you didn't want to force it, we're just organically growing at a fast rate. Now with all the changes in the market and the money not being cheap in the market anymore after COVID, it's really hard to grow, right? Now it's not even a choice, right? That's really where I'm at a very, very interesting spot and learning from these firms, and there's so many innovative firms out there that have built this infrastructure already. 

[0:17:30] AD: You mentioned infrastructure, the systems, the process. This is saying, maybe backing up for a minute. Most firm leaders that you speak to and say, “Hey, is cross-selling an important initiative that you think could help drive increased top line and bottom-line growth?” Yes, right? You're probably not going to bump in that. Many leaders that have put any form of thought into growing their businesses as whole and say, “Well, no. Cross-selling is a wasted initiative.” Everyone tends to see that. 

Then the next process, okay, so we agree with it. Now we know that the first thing we got to do is we have to acknowledge that we need to build a system around it. In a CRM, it oftentimes can be the foundation of that system and the technical backend that makes that, “system work” but there's still, there's designing the structure of how are we going to systematize as what's the process going to be? What are the order of steps? What is the order of operations to create that overall infrastructure that makes it successful? 

Behind all of that is ultimately, and this is where it is unique in professional services is, your adoption rate has to be very high, right? Can't do it and just get the seven executive partners to agree to it. You have to get buy-in from good junk of the firm, anyone who's out there. Because that's what really makes a cross-selling initiative function very well, is by having a larger buy-in behind that. That's where I think it segues into, and you made the comment around behavior and accountability. 

I guess, my question to you is, let's just talk on whether it be the behavioral economics, that the incentive plans, the accountability structures. What do you see there and how should firm leaders be thinking about creating that within their organization to make those systems that they spend so much time developing and creating actually work the way they're supposed to? 

[0:19:11] TK: Yeah. That's a really good question. Really good question. I can go on for a long time on this, to be honest. I think at the end of the day, human nature, we're all driven by incentives, right? We're all driven by incentives at the core level. Like some firms do offer incentive plans for cross-selling. Some firms don't. Some firms tight to bonuses. Some firms don't. Some firms have a very cut and dry. “Hey, this is a percentage you get if you're able to cross-sell.” Some firms do it as an overall growth metric for the company, and then everyone does well, and everyone gets a bonus there. 

I would say that it really depends on the firm, but I find the most firms that I talk to, if they don't have an incentive plan on it, they wish they did. Because that would just be an easy thing, because it is a time and things and going out of your nature if there is an incentive there. I think most of the innovative firms I talk to and everything like that, they do have some incentive, but in general, that's the baseline problem. Yeah.

[0:20:06] AD: I want to call this out. Think about this. I agree completely with you that oftentimes the number one challenge, no matter what the behavior is inside of a firm that you want to change, it has to do with tying it back to incentive. There has to be – incentive is not just monetary, but it's largely monetary. There has to be some reason behind wanting to do it, and every one of us as humans, I think we're innately wired to be selfish in how we look at the world. What's in it for me? Doesn't mean that we can't be altruistic. It doesn't mean that we don't want to do greater good. It doesn't mean that we're only looking out for our own benefit, but it sure as heck does mean that if someone tells us we're going to benefit from doing something, and we perceive those benefits to be worthwhile, then we're incentivized to do it, right? That's the idea of an incentive plan.

Just for anyone listening and thinking about, well, why do we need to tie this? We could go into a whole rabbit hole about how to do it, but think about, if in a firm, and for most firms, there's at least some level of compensation or your annual review or something that's tied back to the level of client service that you deliver. If you're a technical professional, imagine if they hired everybody and just say, “Listen, no requirements, no mandatory. Everyone's just going to get paid the same. We'll get bonus out based on how the firm as a whole does with all 700 of us. Don't worry about it. Just do your thing.” 

Sounds like a great culture. Maybe it works with the right set of individuals, but more often than not, what's going to happen there is people are going to step back and say, “Well, I'm not going to make any more from doing this, or I'm going to make the same whether I do this or not. Maybe I'm just going to go watch Netflix instead.” That's the human nature element of this, right? 

[0:21:38] TK: Absolutely. Absolutely. Even twofold for the professional services space, because you do manage your own book of business. Because it's all about what's in it for me. Infrastructure is built by that. If we get experts in each arena and they do really, really well, collectively, we as a company all win. The high tide lifts all ships. That's why, even if it's not monetary, even if it's something, it has to be something where you either get validation or you get some incentive behind it. That's really at the baseline level. That comes from basically the partners getting together and saying, “Hey, we should put this together.” I think the shift is happening. Naturally, it's going to happen. I would say both firms on the top 50 have a program around it, either monetary or visibility or anything like that. 

I think with other firms, a little bit are getting there. Then he would have to put the system in place.  There's so many different systems out there, like CRM, Salesforce, Microsoft Dynamics, HubSpot. Amazing systems out there that really aren't built for professional services, but they're built correctly with the right tools and the right thought and mind of adoption, instead of building it where it's a traditional model where you're expecting people to log in all the time, but building the automation behind it, like tools like Idrive. Tools like other tools that flow and integrate with different systems, so they can get the benefit of it, it will work. 

You just have to remember you are a professional services firm. You don't want to become the enterprise business. You don't want to become the tech business where you're all – because that's not as incongruent the way the company works. I think the firms that are the most successful are they realize what they are, they built the systems there. Then they also have the accountability within industry groups, within practice lines. That's how most firms are segmented. You have monthly meetings where you're accountable by looking into the system and going from there and having metrics behind it and showing validation. Even if it's not monetary. It's credibility throughout the firm and what you're doing. 

Those are the three pillars, but then also at the top line level, it's very being growth driven, right? A lot of firms are very sitting back and then the old days was, “Hey, anytime there's a problem in the world, we're going to get paid.” Now, it's so competitive that you have to be a little bit more proactive. You have to go out and seek this new business and seek going to your clients and asking those questions. Not just saying, “Hey, I'm listening. I hear you're doing your repeat practice.” It's more, “Hey, clients like you in this industry have been doing this cybersecurity. Are you interested in talking to my partner down the hall? I don't know anything about it, but they've been doing great work and these are the risks here. Do you want to just set up a conversation?”

The worst thing that could possibly happen is if, “No, I'm not interested, but thanks for thinking of me.” That's the worst thing that can happen. It's very slight, but I also want to also be very pathetic in the sense that when you're thinking about professional services firms, this is not natural. Like, there's the rainmakers that are very natural. That's why they do very, very well at these firms, because they got into the technical space, but they are natural salespeople. They want to go out there. That's something comfort on them. It's important for tools like myself and people that are growth teams to bridge that gap for them, to make it as easy as possible for them to get out of their comfort zone. 

[0:24:53] AD: I want to go into your tool in particular. One more thing I want to head on before we get into that is accountability. You mentioned this idea of even just simply having reports. Having a consistent rhythm or cadence behind what you report out on. Having available data, showing the progress that's being made or not being made, is often one of the easiest ways to drive and create some system of accountability. Knowing that the key to really any sales and professional services and sales in general, but in particular, a cross-selling initiative, I think. 

It is about that process and that consistency over time and being proactive and making sure we look at the Stephen Covey or the Eisenhower Matrix, if anyone's familiar, the important, but urgent and really what we're describing is this task that is really important, but it's not urgent. You don't have to proactively reach out to a client, an existing client, and say, “Look, here is a way that I think we can add value.” You don't have to do that, but it's important that you do. 

If you make the time, if you prioritize and create the time to make that happen, you'll reap the benefits long term on it. It's against natural human nature, because there isn't always a direct reward sitting just on the other side of that. It's not urgent, hence the get put off, and that's where even just having a systemized way of looking at it and reporting on it, in my own experience, gives a lot of opportunity for folks to see that pattern over time of activity and better correlate it with their outcomes, but also the reason to keep doing that activity over time. 

[0:26:24] TK: Yeah. I would even go a step further. It's uncomfortable. It's uncomfortable. I think it's like even if that you know this is good, you know all the different things, it's just like that not in your stomach and you're just like, “I don't want to get on stage. I don't want to talk in front of people. I don't want the rejection.” “My job is - I'm usually the smartest person in the room when I walk in, and I'm asked to do this, and I help my clients. I don't want people to say no to me.” right? 

When you think about the emotion of it or the behavior economics of it, obviously there’s incentive, and that's really the part of it, and that really when you get to the core of it, is why don't people do this? One, that's not what they like to do. It makes them uncomfortable. They went very, very smart, to some individuals in this industry. The smartest people in the world. Smart people don't like to feel dumb. They don't want to feel dumb. That's why there's so much depth to it. When you get to the core level of it, there's different stages when you put the incentives at this point, we put the system there, we have accountability, but then there's that fourth piece of, I got to understand what this industry is and what majority the people are, so how do we make that process as easy as possible? 

[MESSAGE]

[0:27:39] ANNOUNCER: This is Branch Out, bringing you candid conversations with leading middle-market professionals. 

[INTERVIEW CONTINUED]

[0:27:47] AD: That is where I assume some of your company and the offering that you're developing out is trying to solve that. Let's dive into that. Tell us a little bit more about what you're doing today, what you're seeing, and really the, what we know. I think the challenge you're trying to solve is to help facilitate and make this work better. Walk us through, walk us through how it works and what you're trying to accomplish. 

[0:28:07] TK: Yeah, absolutely. I think like what we're really trying to do is help using AI in data science to help drive cross-selling. Our platform comes into three different levels, really. It's the data science and AI components that you should know it’s component. Then it's the automation component. The last piece of basically saying that, I don't want these professionals to change the behavior and help make it as easy as possible for them to get out of their comfort zone. 

We're still in build mode. We're working with some of the top companies in the world. I think we didn't want to make a micro-wide product, so we took the long road. We didn't want to - basically, most sales companies, technology companies that I know out there right now, it's very quick, quick, quick, grow, grow, grow, grow, grow. We're doing an opposite approach. We're actually working with these clients, partnering with these clients, getting as much insights as possible to build it, particularly for the professional service space to drive cross-selling.

If you can imagine Amazon, how they solved next spec's action for the consumer market. Based on you, on Amazon. It's a funny story. It's like when I was at Kaufman, I came with the idea six, seven years ago at a grocery store. I was randomly at this Whole Foods. I was seeing a ketchup aisle, and I saw all these different types of ketchups, and I was just like, “Why isn't there a cross-selling platform with milk, there's so many different varieties, there's so many things in this grocery store?” That's how accounting firm is. That's how a legal firm is. That's how the professional services firm is. There's no way that I would know what to buy or my consumer to buy. 

Then you look at Spotify, look at Netflix, you look at all these different companies out there, every day we're inundated of going down that buying pattern with that data. That's what we're trying to solve specifically for this entry. Quite frankly, why I'm so passionate about is twofold. There's so many great people in the industry, and technology has never really been built for that. That's the truth. 

All these monolithic companies in the technology space, I’m not naming names, but Salesforce or Microsoft Dynamics, they really focus on other industries. The technology, all the hot industries, all the different things. They don't understand the conversations that were happening about CRM, they don't really understand this space. What we're really trying to do is build something specifically for the professional services space to automate the cross-line process as much as possible, and give people value and feel good to fulfill their privacy. 

[0:30:26] AD: What have you learned in it? As you're going down this process of developing and building a company, what are some of the key takeaways and really asking it from the context of, I am a firm leader, decision maker who's sitting here listening and saying, “You know, Tim?” Like, why? What is this? I know I see some of the value, but how is this any different? How are you actually helping me? What have you learned, figured out a solution for it that I have?” 

[0:30:46] TK: I learned that there's a desperate need. I learned that everyone knows this is the way. Everyone knows the way, which is very validating for me, but also put some pressure on me as well, which we're ready for. We have an all-star team ready to go. I learned that the nuances of this process - there isn't just I'm building this platform, like I said before, and it's not a layer. I'm so happy that team decided to do the approach of not just building the product and going out there and making it scale. Most technology companies are built in the microwave generation that we are in. 

I learned the nuances of the education. I’ve learned about the behavioral economics of it, how the different roles and the different stages occur that incentives are different. I learned that growth teams incentives are totally not necessarily always congruent with individual professionals. I learned the visibility and the need to bridge that gap to help these professionals to get there. There's just so much that I've learned in the process. 

We've conducted around 50 industry interviews with some of the top leaders in this space in the last two months. We're talking about pretty much every man – every growth leader at the top 50 programs. We connect an interview with what the deep analysis, because we wanted to sit there and just be a sponge, so we can really build up. We're almost at the phase where we're going to be really excited about what we're going to bring to market, but we really wanted to hear from their perspective how they would solve this and what they've done in the past, because every one of these firms have tried this before. They've been trying – this is a Loch Ness monster.

They've had launch and learn. They've had processes. They built things around it. They made investments in the CRM. They made investments in training. They invested in it, but the consensus really is, there's millions, not only – well, if you look at the whole industry, billions of dollars being left on the table by everyone being silenced. It's not just, “Hey, look and just put a technology out there and go into the CRM, and we're good now.” There is a lot of layers to it to do it right. That's a long way of answering the questions, but I've learned so much throughout the last six months. 

[0:32:56] AD: No, that's helpful and insightful. One thought that's running in my mind is you're trying to – people know there's a challenge, right? They know this exists. Part of its changing behavior, part of it is incentivizing team the appropriate way. One of the things you mentioned was this mindset of growth. It's often easy to say, “Well, as an individual producer inside of a firm, I'm making enough. I know a lot of partners who step back and say, I've had a great career. I'm making more than I ever thought I could make. I already work a lot. I'm busy. I don't really want more.” So, growth isn't always the most incentivizing element. 

What I think is really important to highlight and for people to remember is that one of the quickest ways to lose a customer is, you talk about this money that's left on the table. Well, if you leave it on the table and someone else finds it and then they figure out how to ask about other money that's on the table, that happens to be your money. Well, now you've lost that client, right? Someone gets in there and whoever does a good job and builds the relationship and finds out and really cracks the nut on cross-selling into a specific organization, is the one who tends to dominate and win that game. Everybody else gets pushed out along the way. 

[0:34:07] TK: Yeah. The data backs it up. I mean, we have a team of four data scientists. We're having so much fun looking through the data and taking the next phase. One of the indicators that we learned is, the client that had the most risk is the client that only does one service that [inaudible 0:34:22]. 

[0:34:23] AD: It's easy to fire them and –

[0:34:24] TK: Very, very easy for them to go. That is not even just about a growth perspective. That's a part of the client fulfillment perspective, a value perspective. I think what we're really at, the ethos of what we're trying to build is taking a reactive industries for years, and years, and years that I've always – I had the doctor experience where I have a tummy ache, I'm going to the doctor and they’re going to fix my knee, right? A little bit more proactive. It's simple when you think about it that way, but that is the moment that we're really trying to come. You made a lot of things, a comment in the sense that we talked through a lot of this in the sense of your systems, there's the proactive behavior, there's all these different things that I can do individually. 

One of our missions as well is knowing that we're not going to be able to change some of that. How do we use AI and automation to make it happen regardless. Regardless. Because when you really think about the functions of the firms, there's the individual practitioners who are super busy, super busy non-stop working with clients all the time. They're usually older, so they don't want to adopt technology, change the behavior. They never had a technology. I really was bringing them what's in it for me? There's a lot of factors. There's resentment there. There's a lot of different things there. 

They also want to fulfill their client's needs. They all want to do that. The challenge at the point, it's there to do that. Our idea really is, and this is what we're really building, I'm going a little bit too deep that I didn't necessarily want it to go, but is, that's okay, right? What if we can give you the value regardless? You just keep the same behavior. We'll drive the results and we'll centralize that information for the growth teams that are actually looking at that data. That really is the next phase of what we're doing.

Yes, we have the best ones that are out there. They want to cross on where the young partners that are hungry that they want to build their effective business. Growth for them is very important. Then you have the rainmakers. The people that are really, it's more about their legacy? It's about the – “Hey, I build this – I want to make sure it's stable. So, when I'm retired, I want everyone, so it's still running, the partnership still goes and I still have the incentives there.” Also, when you get to the phase that you've been really successful, it's all about mentorship. Mentorship, and make sure that the people behind you lift them up until they can go forward. 

I think on our side, I think we're looking at all the different angles. We're looking at the growth and the people that want this information. They want to grow the book of business, especially in the advisory side and at least these new fast-growing industries. Also, if you don't want to change your behavior, we still want to bring value to drive results. It's very, very possible with where AI is right now and automation is. 

[0:37:13] AD: It's exciting to know that you're tackling the problem. It's very clear by the conversation here. You've put an immense amount of thinking into what the problem is and in some of the potential solutions. Again, it's exciting that you're driving that way. Maybe it's a final question for this is, if someone's listening and saying, “You're right. I think cross-selling is something that we do very poorly. We need to figure out how to improve it.” Outside of calling you, what's the first step they can do? How should they very first dive and dip their toe into thinking about building out a cross-selling initiative? 

[0:37:43] TK: Maybe you start measuring it. You don't know where you want to go until you understand what's going on. You’ll be surprised at how many firms that don't even know how to do it for a cross-selling. They just know we do it efficiently, but they don't run reports and say how many average services do we have for a client; how to start measuring first and say, “Hey, what's our parameter of how well we cross-sell for our top clients? Where do we want to go?” They need to align those incentives with it, then you align the system with it, and then you align the accountability with it. 

Then the fourth pillar is you align the empathy with it. You align the empathy with it and say, “I know these behaviors are going to be hard. How do I bridge the gap for you? How do I put the infrastructure in place, so you can embrace this change?” But it all starts with understanding where you are. Understand where you are, which a lot of firms don't even know. I'm like, “How much do you cross-sell that last year?” “I don't know. I just know we don't do a very good job at it.” Okay. 

[0:38:39] AD: Start getting some data. No, that's an excellent, excellent starting point. Frankly, for all problems we deal with in life, that's probably where we should start specifically in this one. It's definitely where you should start. That's excellent advice. Tim, for our listeners, how can they get in touch with you and learn more about what you're doing? 

[0:38:55] TK: For invite only right now, you can reach out, if you're interested in learning more and have a conversation. You can reach out to propenseai.com or you can follow up with me, I'm on LinkedIn. You can reach out to me directly, timothy.keith@propense.ai. We are invite only. We're so happy to have some of the most innovative firms building with us and we're bringing it to market in 2024. They're invite only process, but if you're interested and you think your firm is hungry, we are taking applications to apply to see if they're really interested. There's a signup sheet on the website if you're interested to apply. If you want to just have a conversation with me, I'm open. 

If you want to share your cross-selling journey with me, please reach out. We want to take as much information as possible and bring the best product available to the market. That is, where we're letting this on that goal. I'm passionate about it. I can't wait to show the market we're doing, just because there's such great people in this space. Nothing has really been built for them before and we're going to do that. That's the Propense mission. 

[0:39:53] AD: Well, your passion comes through very clearly and it'll be exciting to watch you continue to grow this. We'll make sure in the show notes link below are the contact information for you along with your website and your LinkedIn. For listeners, make sure to reach out, share your cross-selling stories and talk with Tim, but also learn how you might be able to work together in the future. Tim, I really appreciate you coming on here and sharing your thoughts today and looking forward to it to talking with you again soon. 

[0:40:16] TK: Likewise, Alex. This is a pleasure. This is a great show and this is so much fun. Honestly, I truly appreciate it. 

[0:40:23] AD: Thank you very much. 

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