· David Senra, Kurt MacAlpine
[00:00:00] S0: As you have more AUM, does the size of the acquisitions have to keep going up or no? How do you think about this? [00:00:00] S1: It's a great question. So, I'm not looking for scale in acquisitions. I'm looking for exceptional people who align, again, I keep saying the same thing, but it's important, strategic, cultural, and financial alignment. So, whether that is a $50 billion acquisition, a $500 million acquisition, or anything in between or on either side of those parameters, that's less relevant for me. In a partnership model like the one that we have, I need those strategic, cultural, and financial alignment things to be true. So, we don't never look at it from AUM, we never look at it from scale. We're looking at it, how is this additive to the business that we're ultimately aspiring to build? And look, fortunate for us, I think given the scale, what we've built is at least currently resonating really, really well, and we're excited to take advantage of. But again, it's an ultimate screening criteria. So, if someone sees our model and they're looking for something totally different, they're not going to come here. So, it's great for us because we're able to filter through the structure, and it's great for them because they have total clarity in terms of what they're looking for. [00:00:00] S0: So, let's go back to this obsession of alignment. Explain, you acquire my company. [00:00:00] S1: Yeah. [00:00:00] S0: What happens the very next day? [00:00:00] S1: Sure. [00:00:00] S0: You told me the story in Miami, I thought it was very fascinating.
· Kurt MacAlpine
[00:00:00] S1: Yeah. So, the business is about six years old, a little more than six years old. There's kind of really called three phases of building the business to get to the state that we're in. So, the first phase was acquiring enough scale. Again, this is a proof of concept. I thought there was a tremendous opportunity. The question is, was it going to resonate and take off? And so, there was, call it a period of time, let's just say the first 18 months, where we were focused on accumulating the scale. And the reason that's important is because the scale drives how you think about integration, the services that you're going to integrate, the providers that you use. If you're going to build a $5 trillion company versus a $500 billion company versus a $50 billion company, how you think about integrating is very different. So, there's a period of time where we were accumulating the scale to start the integration journey. Second piece was effectively starting down that integration journey. So, we had scale, and it was a matter of now how do we pick- ... or make the various decisions that ultimately drive integration and morph the organization. So, some things come faster than others. And then the third piece was where we're at now, which is a fully integrated state. And I think that's really, really important. And if you had asked me when I started, again, because people love optionality, which of those three phases would people be most comfortable with? I would have said people would have been most comfortable with the first phase, right? Because it's the least amount of change at the start.
· David Senra, Kurt MacAlpine
[00:00:00] S0: Yeah. [00:00:00] S1: It's actually not true. People are most comfortable with the current state because they know exactly what they're getting into, which is interesting. So, you know, like if you're selling a firm to us, here's exactly what life is going to look like on the other side. You're going to know it two ways. One, because I can tell you what it looks like from the conversations, but also there's a ton of people now, 3,000 in total, that you can reach out to and interact with, what is life like here? And the people who've been through the journey with us tend to be the greatest ambassadors. And I think a lot of our success, or the reinforcement of the success, comes from people who've come. The clients and themselves have had a great experience, and they become great ambassadors for the business as we continue to grow. [00:00:00] S0: But what does total integration look like?
· David Senra, Kurt MacAlpine
[00:00:00] S0: But what does total integration look like? [00:00:00] S1: Everything. So, on day one, you're on our brand, you're using our technology, you're working in our offices, you're collaborating together across the firm. The collateral's been changed. You're on our comp, you're on our benefits. So, it's effectively a full integration. With one caveat, though. This business is all about continuous improvement. And so, I'm a huge proponent of, again, constantly changing, constantly evolving, constantly pushing ourselves. So, while that state of being integrated is true, every single acquisition that we make, every hire that we make, every conversation we have creates an opportunity for us to think about how we continuously improve the business. So, we're benefiting as well from these acquisitions in the same way that the acquisitions are benefiting from us. And to me, that's the- [00:00:00] S0: Hey, explain a little bit more about that. [00:00:00] S1: Yeah. [00:00:00] S0: How you benefit.
· Kurt MacAlpine
[00:00:00] S1: Because, I mean, if I think about, like, if I'm looking at... Again, if you have a business in this space, the only reason that we should work together is if two things are true. I make you better, and you make me better. If those aren't true, in my opinion, then it becomes a financial transaction. And that's fine, but that's not ultimately the objective that we have in place. So, we're looking, what are you doing for clients? How do we benefit from that? What expertise do you bring? How does that expertise translate to better outcomes for clients that we have? Same thing, there's hopefully things that we're doing that benefit you. So, it becomes immediately this mutually beneficial experience. I'll give you an example. So, when you grow up in management consulting, right, a lot of the work that you do as a management consultant tends to be high-level strategic work that often skews more confidential in nature. And so, you tend to do a lot of work, let's just say, in a vacuum to some extent, and then there's an implementation phase. So, there's a lot of pros to that. There's a lot of challenges to that around driving adoption. So, I'll just kind of tell you a story which is, I think, relevant to how I think about integration. So, we're building the company. I need to pick a brand. And you need to pick a brand for the business. That can be an emotional thing for people, right? Entrepreneurs oftentimes will name the business after themselves, right? So, it extends beyond just the name. It actually becomes personal. So, there's really kind of a lot of different ways you can handle it, but let's just say two extremes. One extreme is you pick a name and tell people what the name is, right? So, call that the fastest pathway to an outcome, but the least collaborative possible way that you can do it. Or the other end of the spectrum would be, how broad can you go? So, I'll just tell you exactly how we picked the name Accordant, which I think is a pretty neat story. So, I did a town hall across the firm and said, "Look, we're at a point now where in our integration journey, we need to name the firm." And I have no idea what the name's going to be. I don't actually care what the name's going to be. But it's really important to me that everybody here who wants to be involved in the naming of the firm has a voice in ultimately doing so.
· Kurt MacAlpine
So, I said, "Look, we're going to hire a third-party firm to help us with this. Our chief marketing officer and I are going to facilitate a series of focus groups. Anybody who wants to participate in a focus group can put their hand up." And the goal is ultimately taking an infinite list of names and narrowing it down to finalists. So, firm was a lot smaller at that point in time. We had like 75 people participate in these focus groups. So, we get all the way down to a list of finalists. We then had a firm mock up the finalist names. I ran a town hall across the partner group. My chief marketing officer presented the names. And branding's kind of fascinating, right? Because if you like a certain type of... If you like golf and you have a logo with a golf course behind it, you're more likely to vote for it than if you don't like sailing and you have a logo with sailing behind it. So, we mocked everything up under the same brand. I did a partner town hall, we presented it, and I did a live vote, and we named the firm together. And the reason that was important was, on day one, every single person who wanted a voice in the process had a voice. It was totally transparent. Everybody knew where we were going. So, on day one, when people were calling and telling their clients about the firm, anyone who was here had an opportunity to name the firm and be a part of it. So, those little decisions, one, it changes how people think about and embrace change, and I try to take that concept and apply it wherever we can. I think it leads to way better outcomes because you're just getting more people providing input. And people embrace the change better because they can see their input reflected in whatever you ultimately decide.