Iain Blair - Scaling a recruitment business 101: advice you can implement today

Welcome back to the Recruitment Mentors Podcast. I'm your host, Hishem Azzouz, and on this week's episode, I was joined by Ian Blair, who is the founder and MD of Bristol-based Revoco. Ian has worked in industry since 1995, and what we really discussed in this episode is whether you should scale or not scale. Ian has experienced both. He's perfectly positioned to talk about the things that come with successfully scaling a recruitment business, as he was one of the 4 founders of the Rethink Group, which scaled to over 100 people, different brands, different businesses. And then over the last 5 years, he's been really committed to building a recruitment business that gets no larger than 30, that doesn't lose its culture, that he can really pay close attention to profitability per head. And just really own that small recruitment business and enjoy the journey. So we're gonna unpack, do you scale and what you need to think about, and do you not scale? Enjoy the episode. Ian, welcome to the podcast.

Thanks for having me.

Really looking forward to this one. I think obviously when we're preparing for this and thinking about what we wanted to go through today, I think you've been on a really interesting journey that a lot of people could probably learn a lot from and also be really interested to hear. So I think the way that we're framing this up, aren't we, is like to scale or not to scale, because you've been on a journey in the last 5 and a bit years of quote-unquote not scaling, deciding that you want to build a really nice profitable business, potentially smaller and not the scalability of the previous decade or the amount of years that you worked with Rethink Group where it was an entirely different journey of scaling it to 100+ people, different locations and all those types of things. But I guess where I always like to start is the million-pound question and probably something that might have changed in your time in the recruitment industry, but also probably something you've really thought a lot about. So I would love to hear your take on the characteristics and traits that you typically look for or find in, in top performers, in modern-day successful recruiters.

Okay, I think, um, for me the key of that question is the modern-day bit, and I do think it has changed. What underpins the characteristics I look for haven't changed, so you're kind of resilience, competitive nature, that get-up-and-go that you want from your recruiters, that's never changed. But I think in today's world, what I really look for are things like authenticity, so being, just being yourself and being true, because I think people see through that if you're not. Don't really believe in people putting on that kind of work mask when they come to work, you're just not sincere enough, not authentic enough. So I look for sort of authenticity over and above all the other traits I've said. The other thing I kind of really look for is, I sort of talked about resilience a bit, but it's more about the emotional intelligence, which again I guess is linked with authenticity. It's being able to read people and being able to kind of mirror and match rather than just be kind of one, one size fits all, if that makes sense. So that's, those are the traits that I think are really important. Today more than anything else.

And curious, like, how do you look for those in an interview environment? Because I feel like they're quite non-tangible.

It's tough. It is actually really tough. I think the authenticity thing, often you can start an interview and you end up having to say to the person, can you stop with this, with the interview charade?

You can be yourself.

Yeah, I want you to be yourself. I want you to stop giving me interview answers. I want to hear what you really think and what you really want to know. So sometimes just breaking down that barrier helps. You can also clearly do a bit of research on them before you meet them so you know what they're interested in, what they like to do, and then when you're asking them about that, if they don't tell you about some of those interests, they're not being authentic.

Sure.

So you can kind of probe a little bit around that. We do tend to do a bit of an assessment exercise when we go through an interview process, and that helps as well. You can really start seeing personality coming through when we do some of those kind of— they're not like group exercises, but so yeah, that's— but it is, it is a tricky, it is a tricky thing to try and get.

Which is what I wanted to ask. And then I guess before we go into this, just because I think it'll be useful for people just to get your perspective, why, why is it that those two things you really now look for, or like, why do you think they're the things that you spoke about that are maybe in line with things have changed now, or things like, out of interest?

Yeah, it's a really good question. I think I think it's because the world of recruitment is so saturated now. I mean, you know, I started a long time ago and I worked for one of the big players out there, and our USP was the size of our database. And, you know, we were like the only players in town really. And I'm going back a long way. If you think now how many different recruitment companies there are that all claim to be different and all claim to have this, that, and the other, it comes back to basic sales to me. And, you know, what do you like? Who do you like buying from? I like buying from I like, you know, I'll get put off by a product if I don't like the salesperson. So that's where that kind of authenticity comes in and just being yourself and being convincing about what you're selling and what you're talking about and what service you're offering, rather than putting this recruitment mask on, which isn't often a pretty mask, if that makes sense.

That's interesting.

Does that make sense?

Yeah, no, it does.

I think it's just because it's so saturated and to be, to stand out, you have to be yourself.

You truly have to own yourself, know who you are. No, it's really interesting, the chap that we had sitting before you, Anthony, he actually sort of shared when— so he started his career at S3, and the 3 years he was there, it was up in the moment that he actually brung his full self to work and he was authentic and he brought that person to work rather than like the professional Anthony was the moment that it really kicked on for him. So it's just interesting you say that, it's completely right. So I understand what you mean. So let's start with then, we're going to get straight into it for people because as we said, there's so much that we could talk about with your journey, but I want to sort of dive straight into it. So I guess feel free to help me out here, but I wanted to frame up for people, for people listening. We're going to talk a bit about the learnings, challenges, principles to scaling, and with hindsight, what you've learned on those things. So I guess just to frame up, you were obviously one of the four founders of Rethink Group. Yeah. And obviously you, you, uh, over sort of 8 years, you scaled that from scratch to around 150+ people, and you had made a couple of, uh, key acquisitions along the way. Digital Gurus, you had Farouk on here before, yeah, um, was one of them. Then had RTM Recruitment as well, um, and then I don't know if there's any other but key sort of brands in there.

Yeah, they were. I think the two acquisitions that we made towards the end of my journey were Digital Gurus and an RPO business called Consort, which then became RTM. So yeah, okay.

And then obviously, yeah, and then you actually floated that business on the, I learned this through obviously AIM Stock Exchange, the AIM market. And then yeah, that's then when obviously VCs involved, you obviously didn't have as much control as you did before. And then I don't know the exact time period, but then after that, after a period of time, you then left. And then for the last 5 and a bit years, you've been on a different business journey, right? So when it comes to Rethink.

Okay, you've just summed up about 20 years of my life.

I know, it's so unfair, it's so unfair. But I guess it's just, you know, with these things it's the context, isn't it, that's useful. So I guess let's just, like, let's just start then. Like, a lot of people, because I'm sure you've met them, a lot of people say that they want to scale a recruitment business but may not necessarily actually achieve that. Yeah, and I'm sure you're aware, like, if you were to look at the UK recruitment market specifically, a lot of the data suggests that most of the industry is made up of small micro businesses that are under X turnover and X amount of people. So like, I guess let's just start with like, from your perspective and the journey that you've been on, why do you think a lot of people maybe struggle to scale their recruitment business if that's what they set out to do at the beginning?

I think I mean, we were very successful at scaling Rethink, partly because there was 4 of us doing it, of course. So I was able to get the Bristol operation to sort of 30 staff, and my co-founders, one in London and one in Manchester, did the same. So very quickly we were at like 80, 90 staff.

Had good critical mass.

I did 30, they did, you know. Yeah. So there was a bit of a safety in numbers there, which really helped. And having the geographic presence from day one as well, and the 3 offices you'll see A lot of recruitment businesses now start in one office, and then when they, when they got that scale, then they open another one. We did kind of big bang approach, so we made a lot of noise. Um, I think personal brand is really important, and I mean sort of your own brand, so the founder's brand. What are they known for? What have they done in the past? How successful have they been? Their own reputation in the market will obviously help attract people in, but it's, but it's also about knowing Knowing exactly what you're trying to build, what you're trying to create. I know that sounds obvious, but I think some people try and scale up but without a plan, without necessarily a vision, without necessarily a real purpose of what they're trying to do there. You know, they'll talk to people that they want to scale up because they want 50 staff. Well, that means nothing to the recruiter. He doesn't care whether you're 30, 40, or 50. They want to know what's in it for them, right? So I think that's where maybe some of the businesses struggle. They haven't really got a clear purpose. They haven't really got a— I'm sure you've talked so much about a clear USP, a clear differentiator.

Sure.

I hear people all the time saying, 'It's our people.' What does that actually mean, right? Why are you different? Yeah, exactly. So I think having a really clear purpose, a really clear direct— and a plan, a budget, a clear focus on how many heads do we need to get to by what date, and what are we expecting those Hez to deliver. We were religious about setting budgets in the early days of Rethink, really religious, that you wouldn't change, you would stick, stick, stick, live or die by them basically.

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And I still do now. So I still write budgets today for Revoco. I still have a monthly board meeting that I still religiously put a board pack together for, even though it's me and my co-founder and my non-exec, 3 of us. So, but I still treat it like that. So I think, yeah, you need a plan. And also, how do you measure, you know, how do you measure the success of your growth and your scaling if you haven't even got a plan written down on paper. So, so if I'm—

what I'd be interested to get your thoughts on this— if I'm listening right now and I am, I, I do, I do want to scale my recruitment business, I might be listening to this go, you know what, I, I don't have a plan, I just know that we want to, we haven't, we want to have another really good quarter, uh, and I am committed to this, like, but I don't really know where to start. So I'm not going to ask you for the, the, the what I need to do tomorrow and the things I need to start, but what I'd love to hear your thoughts on is what, what good quality questions can I ask myself to understand what my purpose is, or how can I uncover what, like, the future looks like? What are some good questions that people can ask themselves to then unpack this? Because I think if you do that work, then you can reverse engineer stuff, can't you? And then you can really think and understand what is it that we're trying to achieve here. I think that's where it can all start. What good questions can people ask themselves? What typical questions do you like to ask yourself to really uncover that?

Well, it's a really good question, and it's What, why, why have the plan? What for? What are you actually trying to achieve from here? Because I think a lot of people fall into the scaling, scaling up route because that's what I think they've seen around them and that's the right thing to do, right? But only if that's what you want to get, if you want to get out of it. So I guess it's a little bit of a debate around is it a lifestyle business, is it a value play, or is it a bit of both? And, um, the, the sort of lifestyle play is a bit obvious. You can keep it small, you can keep it profitable, you can, you can enjoy a good living out of it, whether whereas the value, the measures are often very different. Headcount will be a big one, revenue will be a big one. You kind of not really need to worry about profitability whilst you're scaling. It's kind of the least thing you need to worry about. It's all top-line growth. But what's the plan? You know, why do you want to scale? Yeah. What are you trying to achieve? Do you have an exit strategy? Is it a really clear exit strategy? And by the way, that can be a bad thing too because I can honestly admit at Rethink we had a very clear exit strategy from day one, which we never achieved after 5 years because the whole economy swung. You'll remember the '08-'09, well, you might not, but it was a horrendous time. And, you know, that was the point we were sort of due to start to exit, which of course never happened. So yeah, I'd say you need a really clear end goal. Yeah. And what, you know, really challenge yourself, ask Deep questions. Why do you want to do that? Why do you, do you want to exit? Why do you want to exit? What are you going to do after you exit? You're going to do it all over again or, you know, buy a big yacht or I don't know. So yeah, have a plan, have an end goal and then have a plan to get to that goal and then appreciate that it won't be a smooth road.

So a couple of final things on this. So talking of exits, I'd love to hear your take. I remember asking Farouk this, but I'd love to hear your take. Obviously, the way some people listen to this can achieve that exit if they are scaling is through M&A, is for being acquired. So, like, from what are some of the key metrics that, or key things that you really looked at for you to get excited about potential recruitment business acquisition or opportunity, and some of the things that maybe saw in the likes of Digital Gurus that got you excited?

So, from my own personal experience, what we looked for and what we got excited about businesses like Digital Gurus, they were a rapidly expanding, growing business in a market that complemented Rethink's market really well. So Rethink was traditionally it, Digital Gurus were obviously a lot more digital. I know it sounds a bit obvious now, obviously the world's sort of merged a little bit since then, but at the time they, they were doing fulfillment in areas that we weren't. So that is a very nice strategic acquisition, and it was a really successful one for both parties. The other acquisition that we made was to plug a gap in our RPO offering. So Rethink was very strong selling managed service programs, big contract, you know, RPOs if you like, or MSPs, but we didn't have many permanent RPOs, and we acquired Consort because it immediately gave us 3 or 4 really strong case studies some revenue coming through in that world. And anyone that tries to get into this world will know that that first case study is kind of the really important one to get.

So it's the first thing then was these brands added to, or plugged the gaps maybe?

Absolutely. Think of it like a jigsaw. I know it's a bit cheesy, but they were like the missing pieces of the jigsaw. Immediately added value, but it fitted really nicely. But the non-negotiables of what you're looking for within those acquisitions isn't always just growth or profitability or whatever.

NFI.

NFI, etc. It's culture as well. I mean, I've also experienced acquisitions where the culture was wrong, so you literally, you might as well just smash two businesses together and it ends in tears really, really quickly. So yeah, making sure there's a cultural match is really important.

Anything else? Leadership team?

Yeah, but obviously sometimes you've got to factor in that the leadership team may go on an acquisition, so, but the culture comes from the top anyway, doesn't it? So I think if you get the cultural bit right, you've probably got the right sort of leadership in there. And, you know, areas of the market that you, as I said, that you might be short in that are also highly valuable. So if you're looking to exit yourself, let's say for example with Rethink, we wanted more this RPO revenue because it attracts a higher multiple on exit, then why not buy a business in that's already got that, which can then springboard you into that world?

And then, curious, may or may not know this, but if I'm listening to this right now and I know my exit strategy is to maybe get acquired by something like the Rethink Group or a similar entity. How can I get on their radar? How, like, how can I make people like you or businesses like that aware that, look, I think I might have a business here that could actually add value to what you're building? Like, is it, I don't know, how did you come across these opportunities? Did you go to market?

It's such, again, it's such a great question because there's also a an argument. If you go out to market knocking on people's doors saying that you're thinking you might sell, you're not very attractive. You need people coming to you going, we'd like to buy you, please, not the other way around. So obviously, good old-fashioned networking. This is where a, you know, a really strong non-exec might come in, or non-exec chairman who is well networked. So actually, the Digital Guru's introduction came through our chairman at the time. Was also a non-exec at Digital Guru, so knew that both businesses would work well together. So I think, you know, that's a big part of a non-exec's role. But yeah, networking and just— but concentrating. If you want to be bought, just concentrate on building a brilliant company. You can't really tout yourself out there for sale. When it gets to it, of course, there's brokers you can talk to and middlemen. Of course you can, you get approached. You know, there'll be lots of recruitment owners watching this.

But you're gonna have a lot more leverage if people are coming to you, is what you're saying? You don't want to be for sale.

Yeah, okay, I got it.

So there's a couple final things and we're going to the next part of your sort of professional journey. So the first one, I really wanted to get, hear your thoughts on this because I think it's really interesting for people. And I know we spoke a bit about this, but I hope you don't mind me sharing. You can let me know if it's okay to say this, but obviously you shared with me in preparation for this that when the four of you voted for being acquired, you actually voted against that in terms of how you saw the future of the company or anything?

It was not being acquired, it was floating.

Oh, floating, sorry, floating you said.

So, yeah, I mean, the backstory of the flotation was Rethink was only 3 and a half years old when we floated, which is like the minimum amount of trading you even need to do to become listed. So, it was really early on in our journey and one would argue too quick. The reason I actually didn't want to float was because I could see the world was changing rapidly, it was '08, '09, when we hit our first big recession, and I felt it was just the wrong time to do it. The challenge you have, if anyone's watching this that's been through it, will know how expensive it is to list. Yeah. With Nomad fees and broker fees, and it's extortionately expensive. So once you've invested all that money to then pull out, you've literally wasted all that money.

Sure.

So it was a little bit of a case of we do we, don't we? And the majority of the board decided we should do it. But yeah, so hindsight's a wonderful thing.

And then I guess, so correct me if I'm wrong here, but what did you exit, like as in did you achieve an exit or a milestone like a business?

Me personally?

Yeah, so, um, or the business as a whole?

Yeah, no, so well, it's very topical, Rethink are in the process of exiting at the moment through a management buyout. But no, me personally, what What happened towards the end is I spent 4 years building our RPO and talent management division, which is called RTM, which I really enjoyed. But we then brought in a venture capitalist who injected lots of money that enabled us to do the acquisitions that we spoke about earlier and also delist because it reached a point where there was no point being on the AIM market. And that's a whole nother topic. So we ended up floating. And then delisting 4 or 5 years later. But the inevitable happened for me personally. I felt that with the VCs coming in, they put their chairman in charge, which they had a right to do. They changed the board structure, they changed the strategy. I'd lost control pretty much in my own company and didn't necessarily share the future direction. I didn't— didn't sit that well with me, so I ended up having to negotiate my own exit. Out of Rethink, and that was in 2016 when I then obviously sat down and worked out—

Yeah, because I was just, what I was trying to tee up there was I was going to ask you, but I may have got it wrong, I was going to ask you like how obviously you leave, you get to a point where you want to exit or get sort of VCs in your excited, you're putting the deck together, the money hits the account, you have these people involved. I wanted to sort of hear your take on how you felt after. Do you get what I mean? So I think that's why I was just trying to sort of get that, because I think a lot of people talk about getting to that moment and then when they get there and they experience it, they're like, fuck, this maybe isn't what I expected, or it's a lot more challenging than I expected. But I think you just shared some of it there.

Yeah, I think just be absolutely aware of what you're getting into bed with, because, you know, we joined with a business that was quite a benign VC, i.e., not a very aggressive one. They weren't going to expect a return in 3 years, they were in it for the long journey, so it's as safe as a VC is going to be. But even then, they, you know, they did, as soon as they put their chairman in charge, things changed and everything changed ultimately. So just, yeah, I guess be careful what you wish for. But that's not to say that clearly getting VC backing is wrong, because I'm not saying that.

No, yeah, no, you're not. I was just curious to find that, your experience.

But I wasn't quite as buzzing as you, as perhaps I wish I had. It was quite a strange time really.

So final question then. On the scaling part is, it's an interesting one, so I want to hear your take on this. So basically the question is, if you started a recruitment business at the same time as another person, and you both had the exact same aspirations, you wanted to scale, but where they are now, they're at 30 people and they've sort of been stagnant, and that's where they sort of ended up staying, but you've grew to 100+, 150, you fulfilled your aspirations and exited that company, What did you do differently?

What would I do?

What did you do differently? So obviously, comparison— if you started at the same time—

150.

Yeah. So if you, if you start at the same time as someone that didn't fulfill the aspirations of scaling and exiting, people want to know what, what is it that he ended differently to that person that had the same aspirations?

It's— oh gosh, what a question. I think, um, I mean, you know, it— we, we had a plan to scale, so our whole strategy was scale, get to scale.

So you had a plan and strategy, that's what you did differently to this person?

Well, possibly, but possibly, especially if they only get to— if the person who's at 30 wants to be 150, yeah, they're not fulfilling their strategy, are they? They're not delivering on their own promise. Yeah. But again, it will probably come back to lots of things I've said already. I mean, there are loads of recruitment businesses, you know, who've got like 10, 11 people, and they seem to just always be at 10 or 11 people. That's fine if that's what their aspirations are, but, um, yeah, we're on a slightly different path again.

Okay, so let's go into the, the not scaling.

Yeah, the—

so I don't, I don't like— so would you, would you call your recruitment business now a lifestyle business?

No.

Yeah, that's what— yeah, because I don't think that's fair.

No. Well, uh, no, I don't call it a lifestyle business because I don't run it like a lifestyle business. Um, And that's the whole lifestyle versus value play, right? I'm— so Revoco was born, you know, not that long after I left Rethink. Part of my negotiations leaving Rethink was that I had no post-trade restrictions, so I could set up, which was a bonus because I would have gone off my head if I'd sat in the garden for 12 months. But no, this time around, Revoco's basically— I'm building almost what I built in Bristol, for Rethink, which is a team of sort of circa 30-odd people. And the reason I'm doing that is because we had the most amazing time at Rethink Bristol. It was an incredibly high-performing office. Everyone generally looked out for each other. The culture was absolutely fantastic, but we were part of a bigger group. And it often, dare I say it, it was the bigger group that actually dragged us down a little bit from group central overheads and all that kind of stuff. So this time round, the journey is very clear to me. I'm not— if I was running a lifestyle business, I wouldn't be trying to scale it to 30-odd heads.

Sure.

I'd be probably happy where I am right now. But I believe that that is the optimum amount of people to create a business that is both still enjoyable to hopefully to work in, the culture and values are all absolutely still knitted in. They start to perhaps creak a little bit as you— they don't disappear altogether, don't get me wrong, because there are some businesses who do it really successfully, but it gets more and more challenging. Um, but personally, I'm on a different journey now. I've, I've done the big scale, I've done the multiple offices, I've done the being away from home 3 days a week. Um, I don't— didn't want to do that again. So obviously things have changed since the the dreaded pandemic, we shouldn't talk about that. But yeah, it's just on it, we're just on a different path. So no, I don't think you can call it a lifestyle business.

Yeah, so again, help me out here for any other further context with people listening, but just to frame this up and then we'll go into how you've approached building that and growing the company in the last sort of 5 years. So obviously, yeah, started it on your own initially, but then obviously had a co-founder join a bit later. So it's been the two of you, um, you had a couple of consultants from day one, sort of early on, on the journey. You obviously approached it in the sense of like you had the lean back office outsource from like the, the start sort of thing.

Yeah.

And then in terms of like where, how you've been on the journey in certain milestones, what I've got down here is I think around about now you're what, 16, 17 people as a business. Pre-COVID revenue was around £8.6 million. As you said, and there's some of the sort of key milestones. So I guess let's unpack this a bit then. So what was the, firstly, like, what was the first 90-day strategy? How was you going to think about how can we be different? We're in a saturated market, what was going to be our USP? Talk to us a bit about how you thought about that first year that you think has enabled you, yeah, that gave you the good foundations to build on.

Okay, we touched on it earlier, didn't we, this sort of USP, and how— and I personally believe that we had to have something tangible that was generally different rather than saying it's our people or whatever. So I did a lot of planning and we created a number of tools that really differentiate ourselves in the market, and they still do today. So we were doing video interviewing way before the likes of some of the big tools in the market, I built my own video interviewing platform, which we used extensively, which added loads of value. We built a tool that tracks the, the sort of insight that candidates share with the clients that they're interviewing at. So you're my client, I'm getting insight back from the candidates about your brand, your journey.

Interesting.

And I'm then feeding that back to, back to the, to the, to the candidates— sorry, to the clients. Because back then, and still today, it was fiercely competitive. And we believed to be successful in techno, you know, in tech recruitment, you have to do all of the things right all of the time. So we built tools that enabled our clients to be better and get better. So we could literally, when someone said, well, why are you different? We say, well, does anyone else do this? Another example is I introduced our Triple B, our Being Brilliant Bonus, which the, the candidates rate my consultants and my staff.

Well, like NPS score.

Exactly like that. And basically their commission, they get an extra amount if they're scoring in the upper quartile scores. So it was about driving good behaviour from the top, from the beginning, you know. So rather than perhaps in some, some other recruitment companies that drive kind of KPIs, all for the right reasons, but that can drive some of the wrong behaviours, I wanted to turn on its head. So I hope that answers your question. Yeah, it was like, how can we physically be different? What can we show people to make us different?

Yeah, exactly. So I know one of the sort of key things was like, I think I wrote down here, yeah, you got your first big RPO client 9 months in, which is a huge win.

Yeah.

So I'm sure you've picked up on this, but I guess it'd just be good to hear your thoughts on a lot of people. I feel like the recruitment entrepreneurs that I've been sitting down with are going on this journey of productization, whereas maybe, I don't know, like 2, 3, 5 years ago, I would speak to you as my potential customer and I say, this is how we work together, you sign terms, when we make a placement, you pay sort of thing. But I feel like, I do feel like the industry is really evolving where it's like, look, these are the different ways that we can work together and these are the problems that we can help solve.

Yeah.

So did, from day one, I know clearly you had all that background with the RPO piece, from day one did you think, right, we need to have products that we take to market? And tell us a bit about that.

Like, yeah, exactly. And you know what, you've articulated it really well. The world in recruitment was slow to catch on, but it's definitely really, really sped up in terms of the different routes to market and the different kind of products that we offer to our customers. My 3 or 4 years of my time at the end of Rethink enabled me to really understand that world of large-scale RPOs or MSPs. So from day one, Revoco offered those services. Winning them is another, another battle, right? Because without the case studies, without the size and the growth and everything else, it is a tricky one. But no, we absolutely always had that as a route to market. The client that you mentioned there, we were fortunate enough to be able to hit it at exactly the right time where their internal team was struggling, they weren't meeting demand, the senior leadership team within it were like pulling their hair out because they weren't being able to deliver the programs. And I quite, you know, aggressively went in and said this because no one's ever heard of you and you're doing some great stuff.

Offering that industry insight.

Exactly, so before I know it they're like, well, fix 'Let's fix it then.' So I was building career microsites and doing social media strategies for them and content plans, driving everyone to the newly built website, and it was a huge success. And off the back of that, we— I started lifting the bonnet in their contract resource and realized that they had 50-odd suppliers. So I rationalized that down to one, us, and saved them a fortune, you know, along the way. So we've always had it. The only thing that's evolved Over time is, and it was during the pandemic, I actually launched our recruitment as a service offering, which is this subscription model that you hear about, or embedded services, etc. And, and that's an interesting world you could do an entirely new session on.

So just, just on that really quickly, so is it like, obviously you had that previous experience, but when you, when you won that, or like the way that you communicated it, you said you didn't have like the testimonials and the case studies, which a lot of people need. Is like the key to start getting those like being really upfront and honest and saying like, we will deliver this and I will do everything I can to make this work. But then learning as you do it, I don't know, I just feel like, not like fake it till you make it sort of thing, but do you know what I mean? I feel like, can people truly, is it as honest as like, look Ian, this is what we can do for you. You will be one of the first clients that we've done it. I don't know.

It's a really, I think I understand what you're asking, but remember it wasn't my first time I'd done it. So I'd done it numerous times previously. So I knew what I was doing. It was the first time Revoco had done it, and the client in question backed me and knew that— knew we would deliver on it. So your question's slightly different. If you've never done that before, if you are a bums-on-seats, on-demand contingency recruiter, yeah, and you go and try and pitch an RPO or an MSP, it's, it's not quite as straightforward. It's not impossible. Yeah, it's not quite as straightforward.

So I know something when we spoke about this, like, I guess what would be good to understand from your perspective is As you've grown this small profitable business, and that's been your intention, what are maybe the sort of different metrics that you've paid real close attention to that you think has enabled you to make more consistently good decisions about maybe when to hire? And like, what are some of the hiring triggers and some of those metrics that are really important from your point of view and growing this company?

So, I mean, you've just touched on a really important part then, which is what are the hiring triggers? So this time around, I've made sure that we've hit certain milestones from a, from a kind of productivity point of view. So imagine, you know, imagine there's 10 staff, and once those 10 staff are averaging a certain level of productivity, that then releases the door to go and hire a few more. And then when they, when they're bedded in and they get up to that productivity, you can go and hire a few more. Whereas if you're on a scale, you would literally wouldn't care about that, and you would be focusing purely on headcount and product, you know. Until you asked me, you might remember, I struggled to tell you what my turnover figure was.

Yeah.

I just don't track it. I'm just not interested in turnover.

Because you're looking at productivity, productivity, staff satisfaction, client satisfaction, you know, EBITDA.

That's all I care about. Turnover, I know it's a cliché, isn't it? It's sanity. Sanity. Vanity.

Vanity is the right word. So you don't have to obviously give me the exact numbers for your business. Yeah, but people would 100% want me to ask right now, okay, what do those productivity metrics look like that you keep a close eye on? Because I really help— I think—

I don't think it's a secret. I think, you know, this sort of— these sort of data and metrics are available in all the big recruiter magazines every year. They do that top, top 50, don't they? Um, and, you know, the really productive businesses are probably doing $18,000 to $20,000 a month plus per consultant or per employee. Personally, I think if you are north of $10,000 a month, $120,000 per head, as long as your back office is lean, which it would be if you outsource it, you're in the right ballpark and you can then move up and watch that productivity increase. But if you're not getting $10,000 per head per month across everybody, you're not productive enough.

So around 10K is the important number? 120, yeah.

Is kind of your minimum, but you'd want to get more than that.

But that would be the minimum for you to go, right, I'm going to hire another person now?

Unless you're on a scale, obviously. Yeah, yeah. Oh yeah, for me personally.

We're talking about not scaling and making better decisions at the right time.

Exactly that, exactly that.

What other key metrics do you look at that make you feel confident that that person is getting to that point before they get to the average 10, 15 grand? Yeah, I mean, the job's on, is it?

Yeah, yeah, yes, job's on. The quality of their clients. So again, I would, I'd far rather measure, and we do measure it really closely, the quality of our clients, and rather than necessarily how many clients, it's how good they are. So your classic gold, silver, bronze. Gold being exclusive, it's, you know, management, more client commitment. Exactly, yeah, exactly. And we've gone in the last 12 months, you know, we've gone from being sort of, I think it was like 60% gold to now like 88% gold. So 88% of our business is exclusive. So that gives us so much, it's so much easier to forecast, it's so much better quality business. So those are the things I'd measure as well as not just, not just pure productivity.

So biggest mistakes then that you think business owners make that are on, on this sort of journey that are, that do really want I do find that when I speak to people, like I speak to countless recruitment entrepreneurs that really just, they want to be a small profitable recruitment business, want to be more than 10, they want to get to that 20, 30 mark, and that's what they'd be really happy with, but seem to always just go on this yo-yoing journey of like getting to 10, 12, back to 8, 9. Like, why is that, do you think? Like, I have a few sort of theories from the common things that I pick up, but from your perspective, what are some of the limiting factors, do you think, to that? Or what do people maybe sometimes get wrong?

Um, yeah, obviously I can't speak too knowledge about what they get wrong, but what I can say is you never stop hiring or never stop trying to hire. So even though you're not necessarily looking to hire, I wouldn't stop interviewing, if that makes sense. You kind of always should be meeting new people and building like a network, a network of people constantly, constantly. You've got to do that. Um, and that's like really important. I think a mixture of experienced hires and rookies is really important. So I used to, at Rethink days, always call it the sausage machine. So we'd have this, we'd have the kind of senior hires brought in, but at the same time we're constantly growing our own in the background, and that way you can then get that scale. I think that's really important. But again, culturally you've got to be so careful. So because Revoco is on a different path and we have a much more— I'm going to say mature, but it is a fun working environment. But we tend to hire more of the experienced hires, and we have— we're in a fortunate position that we get some experienced hires coming to us. And the reason they come to us is because their business is trying to scale so aggressively that they start hiring hundreds of rookies and the culture changes and everything else. So we see that quite a lot. So that's a real fine line between You know, but again, I think it comes back to what we talked about earlier about knowing what you want to be, what you want to be, what your end goal is. Um, does that—

yeah, no, that does. No, that does, that does. Um, so in— curious then with what you just said, with it, because I was— that was going to be one of my questions, how have you approached it, hiring more non-experienced, experienced. I have lost count the amount of times recruitment leaders have said to me I don't want to hire experienced people because they come with bad habits and they can't unlearn those. What's your thought process strategy towards making sure experienced hires work more often than not?

That's another great— you've got some great questions. It's a million-dollar question, isn't it, right there? I think you've got to know the industry well enough. So I'll give you an example. We have hired people in the past, prior to Revoco actually, from, let's say, the S3 Group, who you touched on earlier, right? People that are trained in S3 Group are trained a certain way. And because of the size of the businesses, they're often in, they are a real sausage machine and a cog in a wheel, right? And actually quite a few of them are very successful because of the amount of opportunities that come their way internally, because they've got so many different vertical markets. If you take that person out and then drop them into an environment where they don't have that, they can really struggle. So I remember at Rethink, we almost had an initiative that said, don't hire anyone from es3.

Or like that type of environment.

Because they couldn't survive in our environment. It was so different. So it's not, it's absolutely not a, I'm not being disrespectful.

No, I know what you mean.

It's just a different model. It didn't work in our model. At Revoco, it's a bit different because we're still scaling up. And therefore I can't promise that we have every vertical market covered. How could I with only 16 people? It's about understanding those individuals' true motivators of why they're looking to leave. And often it's just because they're a little bit fed up being beaten over the head for KPI for KPI's sake. They're already successful. They don't need to make 15 Canvas calls a day because they've already got too much work that they can deliver anyway. So again, and I'm not putting down KPIs either, it's still an extremely meaningful thing to do, but the right way. And it can sometimes, it can just piss off the senior consultants to the point where they go, I've had enough of this now, I've had enough, I want a slightly different environment. And that's who we tend to attract.

So what I'm taking from that is you really understand who the type of people that you can help most and can thrive in your environment, which I think comes back to the sort of overarching message here that you've clearly in your journey done a really good job of understanding like what the end goal is, what the purpose is. And maybe I feel like the sort of business owners that I speak to probably don't have, couldn't clearly articulate the type of person they can help most. Yeah, in their career.

It's exactly that, it's knowing who you are and what you're trying to build and being really true to that. Don't get me wrong, I've made mistakes.

Yeah.

I have made, and I've made the same mistake sometimes more than once or twice, right? I've hired people in that I thought this could be a really good person, they might, you know, shake the tree a little bit, if you like, and I've brought them in and it's been a disaster. So you just have to really know who, what gets the best out of, you know, in your culture, in your environment.

And you mentioned there you were in the lucky position of people coming to you. That isn't, again, obviously not saying like you have people knocking on the door every single week, but like, what do you think I've seen your brand and stuff, and I do feel like it definitely comes across authentic, human, it's a grown-up environment, I definitely get that. But like, what do you think you've done well on the sort of employer branding front that's enabled you to have that edge over other Bristol employers? Because there's a lot of recruitment companies to pick from.

Yeah, there is. I'd like to think that we've just got a great, as you said, brand, a great visual brand, a great message to market. Marketing manager does a great job at just pushing the right content out and the right messages out. We have that kind of authentic feel is absolutely throughout the entire workforce, which makes it a happier place because everyone can be themselves, you know, and that is really important to us. It also helps the whole kind of inclusion aspect of things. So I think we just portray that the right way. And I know it's working because when I'm trying to headhunt someone on LinkedIn, often I'll get the message back saying this: I'm not interested right now, I've seen you, if I was to go somewhere, I'll come and talk to you. You know, that's really flattering.

Yeah, that's good, that's the good signs that you want to see.

Exactly, they might not be ready now, but they might be in a year or two years' time. So I think we're doing the right thing, and just as I said, just being really true to who we are and what we are and not trying to take over the world. There's no world domination going on here, it's just staging.

Yeah, it's about knowing what you want.

Exactly that.

So a couple final things then. What, how have you approached like cultivating and building, um, your, your culture at Revoco? Because I feel like you've got the, again, what I'm sort of trying to allude to and thinking here is because of your previous journey, you might be really intentional with the culture building, the things that you do that maybe you picked up or taken from like being in the business that's scaling and then applying some of those things to being in a smaller recruitment company where a typical smaller recruitment owner might not think to do those things or may not think they're necessary. So I guess what I'm trying to ask is, what things do you do from a culture perspective intentionally that you feel really enables you to consistently cultivate the right culture or get the right things across? Again, yeah, I just think like these are some of the things that if I think of the business I worked in, there's 8 of us, we never, we sort of all collectively maybe knew what we were all about, but we never did things that sort of cultivated that or made us really realign with like, this is why we're doing what we're doing, these are our values, do you get what I mean? Whereas there may be things you experience in a bigger company.

Yeah, so I think things that we've done and do well are we constantly run sort of VM squared sessions, so this is your vision and values and mission and milestones type sessions. So we might even run 2 a year, so you never—

Okay, you do that collectively with everybody.

Exactly, and that's the point, it comes from the team, doesn't just come from the leadership, you know, it comes from, it literally is the team's feeling on all of that. So we do that religiously. Things like incentives and rewards, we, everyone's really different, so what incentivizes one person isn't necessarily going to incentivize the person next to them. So, you know, you'll hear of winners trips and lunch clubs and all that. Don't get us wrong, we do all of those things, but we also make sure that we have incentives that really kind of hit, hit buttons of people who don't want to just go out for a really nice meal. So it could be a team event, it could be a, you know, or a singular thing to do with your partner. Yeah, take, take your partner away to a spa weekend if you hit this. It's, it's much more personalised, which you can do when you're, when you're smaller.

Yeah. Interesting. So as you come to the, to the end here, then I guess like for people listening, I guess it'd just be good to get your sort of parting words or advice for people that are maybe sort of caught in between a crossroads of like, should I scale, should I not scale? And I guess for me, I feel like everything that we've gone through, it's come from a place of like, you need to know what you want. Yeah. But like, I don't know, anyone listening to this that maybe is unsure if they want to scale, unsure if they want to build a really good profitable 20, 30 person recruitment business, what advice would you give them that hopefully will give them a bit more clarity and go on the right track, do you think?

If they don't know what they— if they don't know whether they should scale or not scale, that's half the problem, right? Clearly, you've got to be really clear on what you're trying to achieve. If you don't know and it's your first time you've done it, get yourself a really good non-exec or coach. I absolutely swear by that. And find someone who's done what you've done, not say they've done what you've done, just actually someone who's lived that experience. That would be invaluable. But I would just— it goes back to think about why you want to do these things. So if you want to scale, why do you want to scale? What value you trying to create? What is your exit strategy? And at what point will it kick in? And work out how long it might take and then work out how much value you'll get from it. And again, there's people that can help you if you've not done that before. Or if it's more keeping it small, what's your plan? How small, how big does that need to get to? How much profit do you want to take out of the business every year according to your life goals, or whether you've got underlying other reasons to give more back to society, or whatever it might be, you've got to know. What's the phrase? You don't know where you're going. No, I can't remember the phrase.

I know what you're saying. If you haven't got a plan—

You don't know where you're going, you don't know when you get there, and all that sort of stuff. So you've just absolutely— and if you are sat there not knowing, Should I scale? Should I not scale? That's your biggest problem.

Ian, it's been a pleasure. Thank you so much.

No worries, great to meet you. Thank you.

Bosh. Thank you so much for listening to the episode. I hope you enjoyed it and got value from the conversation. If you did enjoy it, please don't forget to like, share, and subscribe, and we'll see you in the next episode.