Each day, we fire up app upon app upon app, going through the motions to create and organize our work and business in meaningful ways. Trouble is, all of that work takes a tremendous amount of time and effort. It can lead to a culture of chaos, leaving people frustrated when they can’t find things, align teams or projects or benchmark data to make good decisions.
Mark van Leeuwen, CEO of VOGSY, has been working in projects his entire life. He knows how complex professional services can be, and how difficult it can be to create change. Mark joins us to share insights gathered from working with many, many professional services organizations, and talk about some of the ways technology can ease our pain.
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Carl Smith: Mark is a friend. He's also a great supporter of the Bureau through the company he's the CEO of Vogsy.
Mark van Leeuwen: Yes.
Carl Smith: He's joining us today from Amsterdam, or just outside of Amsterdam, I think.
Mark van Leeuwen: Yeah.
Carl Smith: Is that right?
Mark van Leeuwen: A stone's throw away, like everything.
Carl Smith: And we're glad to have you on the show.
Mark van Leeuwen: Thanks, Carl! Happy to be here.
Carl Smith: Well, tell everybody a little bit about your background, and how you ended up at Vogsy.
Mark van Leeuwen: Good question. I've been working in some way, shape or form in projects all my life, starting out with a large multinational bank doing all kinds of projects there internally. I moved from there to a startup, a services company, where we were selling ebusiness consulting to large corporates. And that's where technology sort of came into my life. I moved on to basically the other side. Some would call it the dark side of the software vendors.
Carl Smith: And why is it the dark side?
Mark van Leeuwen: I don't know. Some people feel that way. I never did.
Carl Smith: You spend a lot of time with service organization.
Mark van Leeuwen: Yep.
Carl Smith: That's kind of your main gig now, right?
Mark van Leeuwen: That's all I do, yeah.
Carl Smith: So what are some of the common issues you see shops suffering from?
Mark van Leeuwen: Well, there's detail, which is different for every company. But the big picture is always kind of similar. So if you're an owner of an agency, or CEO, or senior leader, then obviously you want to run a tight ship. You want to see profit grow.
Carl Smith: Right.
Mark van Leeuwen: You want to see revenue grow. You want to see people coming on board, new clients. At the same time, you also want to have some fun whilst doing it. That's a bit of a conundrum right there, to combine those two. You'll probably want to take some technology on board to help you with that, and ultimately end up with 15 different apps doing all kinds of different things, not being connected, and you never know what to find where, where to go for what piece of information, and people get frustrated, and that's what we try to solve, basically, with what we do.
Carl Smith: You're so right. It's everybody ends up with it could be 15 different apps, and then we're all working with APIs trying to connect everything together.
Mark van Leeuwen: Yep.
Carl Smith: And that's not fun. But I am curious why you say ... Well, no, I guess I get it. When you run a tight ship, and you're also trying to have fun, that is kind of an interesting thing. But in our industry, having fun is not only part of culture-
Mark van Leeuwen: Yeah.
Carl Smith: It's part of recruiting. It's part of marketing. It's part of everything about our shops. So I'm curious, when we start looking at this, are people reluctant to give up the way that they've been doing things? I think I've heard you say before that we have to happily knock down what we think is the absolute truth. And so, is that a struggle, when you start talking with shop owners?
Mark van Leeuwen: I think it's a struggle. It's a struggle for me, you know, in my everyday life. The importance of being fragile is what I dub that to be. We all know agile. You need to be agile if you're an agency. If you're building product, blah, blah, blah ... But you also need to be willing and able to fail, and then recover quickly. Put those acronyms together, you get fragile, and the ... I use it is because it reminds me that whatever I think about today, or make today, or create today, or decide today, I need to be able to kick that down easily tomorrow. If it doesn't work out, it needs to go. So it has to be fragile for at least some amount of time.
Carl Smith: And that gets to flexibility, right?
Mark van Leeuwen: We're all prisoners of our own experience. We tend to do what we always did, and then we end up getting what we always got.
Carl Smith: Right.
Mark van Leeuwen: I've been doing this with Vogsy for long enough now to know that it takes a long time to eradicate that, get rid of this behavior completely. But we also see it with agencies, with clients. You know, you buy into the big picture. You go for it. You want it. You're ambitious. We connect on the energy level. We want the same thing, and then you go into the detail, and then, you know, sometimes things slow down. And we have to take them by the hand, and sort of lead them to the promised land, if you will, of how you can let go of certain things, certain controls, because you don't need those controls anymore. That's being taken care of by technology now. And it takes a little bit of getting used to, you know, fear of the unknown sometimes.
Carl Smith: Especially for shops in this industry, because most of the shops that I know through the Bureau community started somewhere in ... Well, some in the late '90s, but most in the early to mid-2000s. And so we grew up just, you know, it was fake it until you make it. It was hustle. It was a lot of hard work, and we sometimes don't trust when something's easy.
Mark van Leeuwen: Yeah.
Carl Smith: It can't be that easy. And then we actually ... I've been through it myself, and I've seen others go through it, where you almost mourn the loss of the chaos a little bit.
Mark van Leeuwen: Yeah. So you need to get something in return to make it worthwhile, right?
Carl Smith: Yeah.
Mark van Leeuwen: That's what we try to do. Conversations I try to have when first engaging is I think about ... Or put yourself in this mindset of planning to sell your business. I'm not saying, "Do it." Just put yourself in that, and think about what buyers want to see if they want to give you a good valuation for your company, because that can vary greatly.
Carl Smith: Right.
Mark van Leeuwen: So what are the things they are looking at, and if you go down this route, what will you be getting therefore? Buyers look at things like what is your services mix, your customer mix, the quality of your revenue? So what's your lock in with clients? How is your billing that goes into process? Do you have a unique proposition? What about your people? Do they stay on board? Do people happily join your company? And of course, the numbers, profit margins, year on year growth, what's your win ratio on your deals? All that stuff increases your valuation. And that's why I like that mindset, because it encompasses everything. And yes, change is hard, can be hard, but we try to make it as easy as possible by using technology that is very intuitive to use, and easy, and straightforward. But you need to see the benefit along the way, and understand that it doesn't matter if somebody wants to buy my company. These are things that I want anyway. Profit, I want a good customer mix-
Carl Smith: That's right!
Mark van Leeuwen: I want all those things. And then we can work together and map that out.
Carl Smith: Right. Nobody wants a culture of difficulty. Nobody wants everybody to experience things being slightly disconnected. I mean, that's absolutely no good. It's interesting that you bring up the idea of selling. Mergers and acquisitions over the past two years in our space specifically has heated up, and what's interesting, especially with what I would say midsized shops, anywhere from 30 to 50, I would say, this group has always struggled to understand if it was something they could sell one day. Because we'd always been told that a service shop is only basically selling the people. Now, obviously, there's also reputation. There's also all these other things. But to your point, it's like the emyth. If something is simple to replicate, if something is simple to maintain, then it's easier to sell, it's easier to explain what it is that you do. So it makes perfect sense that if you've got this house of cards of technology that's running your company, it's going to be less likely somebody's going to be excited about coming in, versus if you have something that's solid.
Mark van Leeuwen: Yeah. I mean, you have to show how things work, and why they work the way that they do, and why the results are what they are, and that it will be the same next year. Because if somebody puts that money in your wallet, and you walk away, they want to be sure that this continues. I would argue that most owners, or senior leaders would want that anyway. You build something not just for today. You want it some way to be everlasting, but anyway, you want it to be effective. So that works, I think, this mindset. And services, shops, yes, to some extent they are like flowers in some way. If you don't water them, then they go away.
Carl Smith: That's very true! I've seen that a little bit over the past couple years, too.
Mark van Leeuwen: With agencies, what you also see, and maybe this has something to do with it, is the desire to create product, to create IP, because IP is worth something. It creates uniqueness and all that stuff, recurring revenue, and all these things.
Carl Smith: Well, that is something that people are always looking for, is what is the recurring revenue? How can I get out of the service business? But the reality is, most people stay with it, and the products they try to launch, they don't understand what servicing that product is. And it is still service. It's just instead of clients, you have customers. That's always been one of those things for me, and I think you're right also, that owners want things to be better. And it could be so they can spin up their own stuff, or so that they can improve their service company. But one of the issues I think a lot of people have is they can't find the benchmarks, and if they do find the benchmarks, and can figure out what they're trying to improve, they don't always get good data.
Mark van Leeuwen: That is very true. Yeah, you know, what drew me also to the Bureau, other than the fact that we found out that you live kind of across from where I used to live back in the '80s, in Jacksonville-
Carl Smith: Everybody lived in Jacksonville at some point.
Mark van Leeuwen: And Group Energy was also the ... I think, why do currently people that go to your summits and your boot camps, and what not, why do they go? In a way, to learn from each other, and to bench mark against each other. I would hope that we can find some people who want to think with us about how we could add some data points, and make that sort of an ongoing process for people.
Carl Smith: And it's going to be fun. We've got the digital services outlook survey. We've got all the responses in right now, and that report's being put together, which I think ... This will be the third year we've done it. It's interesting. It's a high level view. But to your point, if we start looking at bench marks, and I know that the team over at Summit CPA, they have a lot of insight to financials into digital shops. They're doing stuff over there. But it is interesting, if we can start really boiling down some of these bench marks, find the right levers, and see how you're doing against the Bureau community anyway, if not the bigger industry.
Mark van Leeuwen: Your peers, yeah. Anonymized of course, but, you know, say I score an 8 on whatever it may be. Okay, that's wonderful. Should it be an 8, though? How do I know?
Carl Smith: And that's always one of the struggles. Like, even if you're looking at Mailchimp, and you see how in your industry what an open rate is. But in your industry includes so much stuff that's not you, whereas if you can fine tune it, if you can really get under the microscope of companies that are like you, what does that look like? That's one of the things, actually, I wanted us to talk about, because you had a story about a Canadian company, an IT company, I think, that was using AI for their supply chain. I was listening to you tell this, and I really wanted to get it on the show, because this is a fascinating story. Give us a little of the background on this Canadian company that I think is a client, right?
Mark van Leeuwen: We've started onboarding. It's a not for profit company, so at current they're being funded with tech spare money, which I know is a hot topic, or it was in the U.S. and maybe still is.
Carl Smith: It definitely is!
Mark van Leeuwen: [crosstalk 00:14:04] probably anywhere, same in Canada. But what is their job? Basically their government recognized that there's a lot going on with AI in the world. It's a huge technology push, and all sorts of different ways to make use of that technology on being developed. But they felt that the economy in Canada is sort of lagging in that respect. It's not picking that up quickly enough, so let's start this company. A bunch of experts who know about this place where AI and supply chain meet. So they have knowledge of both these aspects. And it's a good place to start, because there's a lot of data, and they grow quickly.
Mark van Leeuwen: So one of the issues, one of the main issues they had was, "How do we predict when we need to hire this profile, or that role, or whatever?"
Carl Smith: It's a big challenge for everybody, yeah.
Mark van Leeuwen: Yeah. In their case, maybe even more so, because they need to report all this stuff back up the food chain, and they're getting funded, so you need to ... They can hire, but you better have your story straight. So what is the opportunity cost, and what are we going to gain if we do this?
Mark van Leeuwen: Basically, they're using our product to get this right. What they put in there is their life projects, their short term opportunities, things that are going to fall next month, or maybe the month after, all the way through to the longer term, up site kind of projects, and then start planning against it, and what it spits out at the other end is basically one overview that tells you where you are right now in terms of your probability per person, per head count. I don't necessarily like that term, but okay.
Mark van Leeuwen: And over time it tells you, "If you land this project, you will make this much money, but you need to spend this much money, and you need to have this amount of that type of profile, and all of that stuff." They're all in one place. They're not to do anything other than what they were doing in the past, because they were planning this anyway, sort of, on sheets, and all that stuff. But it's very difficult to get that prognosis out there, and get the business case together.
Carl Smith: That's the thing that I think everybody listening would appreciate. We get nervous about spending the money without knowing that we're going to make the money.
Mark van Leeuwen: Yeah, and you can hire someone today, but it doesn't mean they're going to actually be productive straight away. There's-
Carl Smith: They more than likely won't be.
Mark van Leeuwen: And so, do you take that leap of faith? Or what do you do?
Carl Smith: Yeah. Exactly. And so, just that story, so that they now have this insight, they have this visibility, and they're not doing anything really different than they did before. It's just all the data is coming into one place, where now it can be sliced and diced, and viewed in a digestible format, so that they can make good decisions. That's the dream!
Carl Smith: Well, Mark, I'm so glad you were able to swing by the Bureau studios today and share a little bit about yourself.
Mark van Leeuwen: Absolutely. Thanks, Carl. I look forward to seeing you in Austin, and a whole lot of other people as well. So that will be great.
Carl Smith: We will be! We'll be in Austin for Owner Summit, the fifth one, and I'm excited. It's like a wedding for me. Every time I'm there I see so many people I haven't seen before, and before you know it they're gone! I barely got to say hello, but it's such an amazingly good and educational time. So it'll be great to see you over there, Mark.
Mark van Leeuwen: Absolutely. Thanks, Carl.
Carl Smith: You got it.
Carl Smith: And for everybody listening, thank you so much, and we'll be back next week. All the best!