Episode 75 Transcript

Brent Trimble: Welcome to the Professional Services Pursuit, a podcast featuring expert advice and insights on the professional services industry. Again, for listeners, I’m Brent. Today, we’re joined by two very knowledgeable figures in the consulting world, Ramone Param and Tom Rodenhauser from Kennedy Intelligence.

For some of our listeners, this is Tom’s second time on the podcast. We’ll talk a little bit about that. He’s a managing director at Kennedy Intelligence, has spent almost 30 years advising management IT consulting firms on strategic growth, talent management, and market positioning. Ramone is a partner there and has more than 15 years of experience in M&A advisory, business development, and knowledge management.

We’re seeing some really interesting trends emerge in the consulting space, and we’re going to talk about those. But I’m really excited to dive into today’s topic. We’re going to discuss how PE firms, private equity firms, are driving the transformation of the consulting industry from advisory to more strategic solutions and investment advice.

With our listenership in our platform and all the potential clients, existing clients, we speak with a very large contingent of them, who are on a journey of growth and expansion. They may have just emerged from an M&A cycle. They may have just combined with another firm, acquired another firm, been acquired, or are on an ascendant trajectory for growth acquisition, so I think this is going to be really relevant.

But before we dive in, Tom, if you want to kick off, or Ramone, just give us a little bit of a reentry and reintroduction about yourself, Kennedy, and then we’ll dig into today’s topic.

Tom Rodenhauser: Sure. Brent, I’ll jump in here. Great to be back, by the way. Really enjoyed last time. Looking forward to this time.

Kennedy has been around, and I say around for 30 plus years. I’ve been covering the industry, the consulting industry, for 30 years, and it’s really interesting. We do market research on consulting, which is, for us, consulting to consultants. That’s how I describe it. A lot of the research we do is around size, growth, opportunities, things like that. We look at the providers and their capabilities. We also look at the actual business model of consulting.

This is where the topic for today about PE investment is really interesting for us because it’s fundamentally changing the business model for consultants. Before we get into that, I’ll let Ramone talk a little bit about himself, and then we can talk about how these investments are changing.

Ramone Param: Thanks, Tom. Very pleased to be joining today. Ramone Param, I’m a partner at Kennedy Intelligence. As mentioned, I lead the consulting and M&A offering at Kennedy. My background’s over 15 years in professional services, M&A, and strategic advisory.

I started my career with the Macquarie Group. I was advising their managed funds on investments across a variety of industries. I then joined PricewaterhouseCoopers and I spent a substantial period of time at PwC, advising their global network on making acquisitions in consultancies and also digital consulting players.

After PwC, I then joined two advisory firms, spent time with them both advising leaders and founders of consulting firms that are on a sale journey and looking to exit their consultancies, and also with large professional services firms that were looking at inorganic growth and making acquisitions of consulting firms and also digital consulting players.

As mentioned now, working with Tom, extending the Kennedy offering into advisory and also M&A, serving leaders, founders, and also investors in the consulting sector.

Brent Trimble: That’s outstanding. I think that I really want to dig into this a bit because I think it’s extremely relevant both for our listenership as well as our partners and for listeners to the podcast. Myself, I’ve had some nominal experience in M&A, having grown and helped grow practices and firms that were acquired, so part of that journey and that trajectory of certainly the big four, the big five, buying up firms. One of the firms I helped lead was purchased by Accenture.

Ramone, you mentioned PwC and PwC Digital and all the consulting firms buying up these strategic offerings. Today, we’ll start by talking about what really stimulated the invite and the idea for this follow-up broadcast, which is Kennedy recently published a report that I found fascinating, Private Equity in the Consulting Sector, an Evolving Playbook to Transform the Industry. We’ll make sure that listeners have the ability to go check out the report and where to find it on your website, for sure.

But I’m curious to kick this off. Was this report a culmination of things that you’ve been observing? Was it the first of its kind for Kennedy, or at least publishing it in a public-facing way? Will it be a recurring report? Would it be something you’d track? I’d love to hear how it came about and what you intend to do.

Tom Rodenhauser: As I said, we look at the business model of consulting and what spurred this particular report was I think private equity and it specifically is changing the business model in a dramatic way.

But to back up a little bit, you think about consulting firms, and when we’ve looked at consulting firms over the years, primarily the vast majority are private partnerships. There’s so many boutiques out there where the trajectory is a few founders, a couple folks get together, they build the firm and they grow to certain sizes, reach certain thresholds.

The problem has always been from an investment standpoint, as a partnership, it’s the partner’s money that’s investing in the firm. There are different ways. There are some alternative investment scenarios, but by and large, it’s that private partnership model, and it’s a people based business. You put those two together and it’s something where as an outside investor, you’re limited in terms of the attraction for that. At least that’s historically how consulting has worked.

There’s been a couple of paths, I guess, that have occurred where the industry over the last 15 years has become more product oriented in terms of assets and things like that, still people based, but building more tools, more solutions. Then you look at the industry as it’s evolving, the need for investment, the need to keep up from a technology standpoint, particularly when you’re doing digital transformation and things like that. It’s something that requires, in some cases, more than just what the partners can invest.

As a result, you have these two forces converging in a way that says, if we want to grow this firm and we want to scale it, we may have to consider alternate investment scenarios. Where PE comes into play is as an investor, and Ramone can talk about this extensively, PE was a sporadic investor in consulting. I think one of the reasons for that, when you look back to the early 2000s, a people based business from a private equity standpoint or any investor standpoint, you’re looking at the assets as the people, and it’s a very fungible asset, so it’s not a product per se.

You look at the margin in a consulting business, it may not be attractive from an investment standpoint. The third factor is, as an investor, you’re gearing towards an event. You’re looking at it as what are we going to do? What’s the strategy for us investing in any particular consultancy? It wasn’t really attractive for that reason.

Fast forward to the last probably five years or so, and you’re starting to see a massive uptick in private equities’ interest in consulting. Again, reflecting back on how consulting has changed, become more productized, become more assetized, and private equity sees it as a strategic investment, it makes it more attractive.

Ramone Param: It’s an interesting piece, Brent, that we’ve seen, which is that over the last ten years, private equity weren’t significant players in terms of buying in the consulting sector from an M&A perspective.

What we’ve seen in recent years is a considerable uplift in the proportion of deals that are occurring amongst private equity investors. Tom’s discussed some of the reasons behind that. I’d also add, just from an economic macro perspective, the abundance of capital that’s been available amongst private equity, that dry powder that’s been sitting on the sidelines to do deals has really built up in years.

But significant to the professional services sector specifically is the fact that, Tom mentioned this idea around operational improvements and being able to understand how to corporatize the consulting industry and to get the operational improvements in the sector right. That’s been something that’s been very important for private equity becoming more competent and serious acquirers of professional services businesses and also enabling them to pay valuations and prices that have been at the level of those strategic acquirers that are able to pay strategic premiums for assets in hot sectors that are appealing to them.

Tom Rodenhauser: Brent, if I could jump in, just in terms of publishing the report and the motivation for why we wanted to do this report, anecdotally, there’s a lot to talk about with private equity, but what we wanted to do was to look at what is the strategy? What is private equity’s strategy in terms of making these investments? And then also, this corporatization, how it’s changing the management structure and corporatizing, we use that term, the way consulting businesses are run.

We did this research and put this report together, and it is a report that we think will be recurring because of additional investments that are going to be made. But we wanted to organize it so that people understand when you’re thinking about private equity, here are the various things you should be looking at, whether you’re on the sell side and you’re considering private equity or from an investment standpoint itself, people who are looking and asking that question, why is private equity making these investments? That was the motivation for the report.

Brent Trimble: That’s fantastic, and I want to touch on a couple of things around that. But to the listeners, I think at the bottom of the episode, we’ll of course let you know where to go and find it.

Ramone, you said some interesting things around this notion of availability of capital, and certainly in early days the multiple on an exit of a services firm would have been significantly lower than, say, software tooling or manufacturing or something of that sort. I’d love to hear if you see a trend of those exit valuations and multiples going up.

But it’s interesting having been through a bit of this in 2010, 12 to 14, the model there seemed there was this unbelievable land rush to digital, digital transformation, consultancies that were doing strategy implementation of web content management, platform transformation, automation, whatever the case might be, even creative marketing services to strategy. There was this formula. You’d see a firm gain some proficiency, do some great work, assemble a good constellation of clients, maybe bring on a partner and build to a certain scale and size to be acquired by an Accenture, Deloitte, or PwC, whatever the case may be.

Now we’re seeing more, and this was interesting in the report, in that longitudinal progression. We’re seeing the names we’re associated with the PEs like the Carlyle’s, Perficient, EMZ, all these with Mackenzie, these names are more traditional PE that we’re more accustomed to. If you had to guess or opine, lots of available capital, is it the notion of they’ve figured out this formula of making these businesses a bit more predictable and hence more attractive on the multiple, or is it a combination thereof?

Ramone Param: It’s a good question, Brent. Ultimately, I do see it as being a mixture of a bunch of different factors. The abundance of capital previously was low interest rates as well to leverage, that’s obviously not been the case anymore with interest rates rising last year. But I think the dominant factor amongst why we’re seeing this investment in the industry is around the operational improvement piece that Tom outlined. It’s being able to understand getting this model right.

I think one of the common threads across private equity investment and professional services, whether you’re looking at a traditional management consulting firm, a functional expert, an industry-focused professional services firm, or a digital consultancy, why a private equity looking to invest in certain firms as a platform investment—I’m not talking about a bolt-on to an existing platform, but a platform specifically—there are common attributes that they’re looking for and seeing in those businesses.

One element, as Tom mentioned, is around being able to enable operational improvements. Some of that might be assetizing the business. It might be corporatizing the operating model. But also it’s looking for specific attributes around the management team, that vision to enter into new spaces of the market.

Given the professional services industry is undergoing such significant change at the moment, and we’re seeing this convergence of different knowledge-intensive services segments coming together and those nimble consultancies that are able to see these opportunities at the intersection of different professional services markets are really attributing value. Those private equity that are able to enable that change and transformation are attributing significant value in the market.

I believe that the private equity-led investment here is around being able to see operational improvements, but also being able to find assets that have strong management teams with the vision to enter into some of these disruptive segments of the industry and being able to enable higher profit margins, recurring revenue streams from those operational improvements that ultimately lend themselves to an exit at significant multiples.

Brent Trimble: Let me follow up to that really quickly. Do you think the supply of firms can sustain the demand?

For instance, is there a growing constellation of these boutiques that are hitting sufficient scale where the equity flow and interest in the market is there? Do you think there’s a potential for maybe even an overindex into the market?

We’ve all seen these interesting memes, I’ll bring up something humorous, the sharp, ambitious, well-suited trio of PE executives get off a private plane somewhere in the Midwest to go buy a nice, well-performing family-run-for-generations plumbing business of which they have no experience in, but the multiple’s there.

We’ve seen private equity go into some really interesting places, of course, Blackrock with private single homes and that type of thing. Do you see a settling in the market? Are firms building with this exit in mind intentionally? Do you see any exhausting of the supply of firms that can be purchased or the inverse?

Ramone Param: Great question. Just a bit of context here, at Kennedy, we track data across the market going back many years. And this is M&A specific data in the professional services industry. So we’re able to see from a lot of that data, on deal flow that’s occurring in the market where we’re seeing an abundance of supply for specific assets or where we’re seeing a significant amount of buyer activity in segments where there just isn’t enough assets available to be purchased resulting in increases in valuation.

What we saw just going backwards after Covid, during the pandemic, 2020, 2021, there was not enough supply of quality assets that were out there with the amount of capital that was being invested into the market. We’re seeing buyers and in some instances working with buyers that were looking for acquisition opportunities and professional services, and they were just struggling to acquire those assets. They were getting outbid by other competing firms that were out there. There was just ultimately a frenzy in some segments of the market to get acquisitions done in niche disruptive areas of the market. You can think of areas like supply chain transformation, certain segments of digital transformation as people were investing more and more in digital capabilities as well moving to new normals during the pandemic. That just resulted in one end of the market, significant valuations occurring for those prime assets. But also on the other side of the coin, deal structures where they were just heavily cash, being paid upfront to get those deals done, where there just weren’t enough assets available for all the buyers that were interested in making acquisitions and building those capabilities quickly.

We then get to 2023 and we have a look at all of the data available to us over the last year. We’ve analyzed that in great detail, and the trends changed there. There was a supply of assets that were out there looking to go to market, looking to receive investments or sell their business. But interest rates were rising. There was a lot of uncertainty in the market stemming from geopolitical uncertainty and economic uncertainty. The stock market obviously was reflecting some of that uncertainty that buyers and investors were feeling and the trends reversed. We’re seeing a lot less interest to do deals, a lot less appetite to take risk in M&A and professional services. But there were still many of those sellers that had come to the conclusion that they wanted to sell their presence last year, and they were struggling to do that in those markets.

What we’ve seen at the beginning of 2024, and we’ve been tracking data at Kennedy in regards to M&A activity in the first half of the year and making predictions on where Kennedy sees the market going in the second half of the year, the first of the year was robust. We saw a bounce back in deal activity, buyers coming back to the table looking to do deals, sellers becoming more realistic in terms of their pricing expectations in this new normal. Deals were getting done in the first half of the year. As mentioned, there was still this emphasis on private equity interest in many segments of professional services. They were continuing to be acquisitive and showing strong demand. That was reflected in some of the bigger name deals that we saw; Perficient-EQT, Grant Thornton, Baker Tilly, more recently, Apax’s investment in Thoughtworks, all reflective of that continued interest amongst private equity in the market.

In the second half of the year, we’re tracking to see how recent stock market wobbles, and also as we approach the elections as well in the fourth quarter, how that might play through. That might result in a different dynamic in the second half as opposed to what we saw in the first half.

Brent Trimble: Tom, I want to get your take on that, but it’s interesting becaue it follows the data we were seeing from, I think, one of the Midwest fed banks releases data on the services industry.

I think it was up something like 3.5 basis points year over year just of not certainly post Covid demand surging back in the market and overhiring taking place, but a healthy uptick in stability plus in a lot of the services firms.

It’s interesting that the deal flow was tracking to that, for potentially acquiring those firms. But Tom, I’d love to hear your take on that cycle that we’re seeing, how cyclical boom bust interest is it?

Tom Rodenhauser: I have two answers. One is glib, which is there’s an endless supply because consultants always value themselves highly.

As Ramone indicated, sellers are out there thinking about their business, and of course, they’re attractive. But the reality is, as Ramone pointed out, quality assets. A firm has to be of a certain size, scale, and importantly, or at least historically, they have to be attractive in terms of the markets that they’re playing in.

If you look at it from a private equity standpoint and more overall from an M&A standpoint, there have been two kinds of strategies when you’re talking about investments. There’s a market strategy, which is you’re essentially diversifying, so you’re trying to build out in industries and functions and geographies. We’ve seen examples of that. There’s more of a focus where you’re trying to go deeper and an example of like an Efficio, is a supply chain firm that received private equity investment that allows it to go much deeper and scale up its business even more.

But what we’ve seen more, especially in the last few years, is, as Ramone’s indicated, this uptick, there’s more of a business model strategy emphasis. With that is, we’ve touched on the platform. You’d think about a platform in terms of a nontraditional company buying into professional services, and you can point to a Jacobs acquiring PA Consulting from that standpoint. Private equity is using that same model. Then there’s also the productization or productizing.

When you look at it from a business model strategy standpoint and how PEs are approaching it there, the supply of the types of firms that are attractive, they’re there, but not nearly in the same quantity, I would say, as the more traditional market strategy where you’re trying to bolt on these pieces.

Brent Trimble: Let’s continue that thread a little because we’re building to a crescendo that I think a lot of our listeners and the overall audience would value.

This is anecdotal insight, and you could go much deeper. But what types of firms do you see being attractive candidates for this type of investment? What are those attributes?

Of course, we could understand maybe commercially, fundamentally going back, demonstrating some predictable growth and margin EBITDA on those things. But what are those dimensions of firms that are good candidates?

I’d love to hear both of your answer on this.

Ramone Param: I think we could break out the qualities that private equity are looking for into qualitative and quantitative attributes.

On the qualitative side, which is equally as important as the quantitative aspects, you’re looking for businesses that have strong management teams, that have incentive programs in place, which are incentivizing the next tier of leadership team to move up the organization. You have infrastructure in place that enables growth, and I’m thinking of things there like a business development and sales engine that doesn’t result in dependency on existing relationships, but also creates that funnel for new client accounts to come into the organization.

Then also in regards to the quantitative aspects, you’re looking at things like the revenue and profitability growth and also just the profitability margin itself. The EBITDA margin that we see amongst platform investments in professional services tends to be higher than the industry average. Private equity are looking for businesses that are generating cash, that are generating strong profit margins and also have that strong revenue visibility that’s in a healthy pipeline. Ideally, you have recurring revenue streams that gives you that visibility into what future revenue is going to look like.

Ultimately both sides of a coin is about reducing risk for the private equity investor. There’s qualitative and quantitative aspects of that business, reduces risk but increases the upside potential for the investor.

Tom Rodenhauser: From my standpoint, we do this work with consulting firms where we looked at their business model, we looked at the potential to increase valuations, things like that. Basically, there’s eight levers that we look at, and they deal with the things Ramone was touching on in terms of sales engine, support infrastructure, things like that.

I think one of the big things to look at, though, is motivation. When you look at accepting investment, you have to look at the motivating factor for that and what it’s leading to. Just increasing valuation in and of itself is good, but are you pointing towards this as part of an exit strategy? Is it part of a collaboration and a continued management by the sellers?

I think what often happens, I think the owners, we’ll call them the owners of consulting firms, tend to be very private, tend to be very close to the vest in terms of how they view their business. Historically, it’s been either a merger, an acquisition or nothing. They looked at private equity as this outside force. I think now that it’s become more accepted, it’s also opening the eyes of sellers to say, well, private equity could be an option, could be an option. Whether it’s a bridge between a traditional acquisition because a lot of private equity, they want that strong management infrastructure to stay intact, as opposed to just that team exits after the acquisition, I think private equity is an alternative.

Because private equity is more attuned to this market, we’re going to see this trend continue. But I can’t understate the motivation factor in terms of what sellers are thinking.

Brent Trimble: That’s interesting. It leads to the second of our three questions here I’ve got leading up to this crescendo of making it work for you.

If you’re an ascendant consulting firm, then this is potentially something on your roadmap for either an exit, either an expansion, either something more, how do you make it successful? But how many do you see firms start this trajectory or maybe retooling their business intentionally with this as a guide?

Or Tom, to your point, it used to be very binary. It was a sell or do nothing exit at the end, and this offers a different path. That may have been more accidental. A founder starts a business 20, 30 years in. It’s run well. There’s good commercials, there’s good relationships. Maybe, to Ramone’s point, there’s some good incentive structures for the next ascendant level of leadership.

How many firms are you seeing that looked at this as or are beginning to look at this as a potential end state or next stage of evolution as opposed to accidentally saying, hey, this could be an option for us as we contemplate the future?

Tom Rodenhauser: What’s interesting there, Ramone conducted an offsite with one of our clients earlier this week, and this was a firm that five, six years ago, we had done some market research for as they were thinking about building out their practice.

In the ensuing time, the firm had doubled in size, they had done some really good things. But the offsite that Ramone conducted was really about the next stage, this journey that gets them over the next five years to a point where they do have the option, the valuation that they want to reach, the value they want to reach gives them options.

I think it was interesting. Ramone can comment on this as well as other things, but it goes back to that. They started a journey five or six years ago by just looking at how they wanted to grow, and then five years later, they’re now looking at it as we want to grow, but we want to increase that value. We just don’t want to grow for growth’s sake.

I think a lot of firms fall into that trap where they think, well, we just need to grow. We’ll go into this market, we’ll open an office here, we’ll do that. Growth for growth’s sake in consulting is not a good strategy, and yet a lot of folks fall into that.

Brent Trimble: That’s a really nice segue into this second and third trajectory we’re building here for listeners that are on this journey.

Ramone, maybe give us some of the cliff notes. You’re talking to a firm that maybe sees this as a potential strategy and you’re consulting them in what should they be doing to make themselves more attractive so that this can be an option that they consider.

Ramone Param: Absolutely, Brent. It’s interesting because this piece that I mentioned around the operational reviews that we conduct at Kennedy, it’s with that lens of saying, well, 12 months, 24 or even a number of years out before when you’re looking to consider an event, receive investment, watch it go to market and actually sell your firm, how do you put yourself in the best position to attribute the optimal value for your business?

The reason why we developed this at Kennedy, this operational review for consultancies that are preparing their business for a future sale or event or investment, or even just to develop sustainable value in their consultancy for the long term, is all about this view that many of them get caught flat footed by an approach from an investor or a buyer, and they look at their business and say, hey, you know what? I actually didn’t realize what the value is of my business. I didn’t actually have a very clear view of what is it going to look like when a buyer does come to me with something which is interesting as a potential deal or a potential partnership?

That got me thinking in terms of I really need to develop a strategy for that future event so it’s not something that I’m reactive to, but I’m really well-prepared for. We’ve developed that operational review at Kennedy for consulting firms to help them think through their strategy optimally, so that when they do get to a point where they want to look at an event, they’re well prepared for it.

I think secondly, as well, this is all about developing sustainable value for consulting firms. We talked about private equity developing a model that they’re seeing as being well developed for being able to achieve value from consulting investments and exit those investments, that strong values and returns. There are lots of ways that consultancies that aren’t even looking to exit their business or receive investment and start to develop some of those models within their own business, clearly articulate what their market value proposition is, start to review their operating model to make their business more efficient and enable margin improvements. All of that you can do actually yourself before you even look to exit your firm or receive investment from an outside party.

Brent Trimble: That’s interesting and this is where there’s some symbiosis between what we do and a firm like yours because with our platform, we don’t talk about our technology often on the podcast, so I’ll talk more in the abstraction of the types of firms and why they come to us.

But in many cases we might be dealing with some firm principles, pre M&A, post M&A, maybe just growing and to Tom’s point, growing rapidly. They found a nice swim lane, some good specificity, a great offering. They’re growing but now they’re doubling back and realized the technology can help them run their operations better.

You’d be surprised, or maybe you wouldn’t actually, how many, I might ask them questions around what does EBITDA look like? What’s gross margin look like? What’s your run rate? And they don’t really know or don’t have a great handle on it, not all, but a fairly sizable portion, or they know and they want to have even greater control, then we get into those conversations.

But inevitably, there’s always ROI with software purchase or software wouldn’t be invented. But increasingly what I find is I’ll build them different valuation models. Here’s what some incremental gains in your revenue margin could mean for an exit and here’s what the market is paying in a multiple. Let’s just flow this out and see what it might look like, and it opens up a different dimension and conversation.

We’ve talked about the trends, the why, the what, the to what extent piece in the market. We’ve talked about where you’ve seen this successful, firms that are great candidates and then making themselves more attractive to this as an option. Ramone, I think you brought up, don’t be flat footed. You might be approached and have this at least some operational rigor at the ready.

But leave our listeners, I think, with some high level advice for maybe preparation for this process and then going through it. What are some of the things you would recommend that firms do to turn that lens inward?

Tom Rodenhauser: I would say there’s a cliche of consultant heal thyself embedded in this, where so many firms think they know what they’re doing and they’re so busy consulting to their clients that the actual running of the firm isn’t an afterthought, but it isn’t at a forethought.

As a result, you look at things like their infrastructure, you look at their support services, you look at the fact that they’re still running spreadsheets to look at their financials or their sales pipeline. There are so many simple things and not so simple things that firms can do to corporatize.

The further along you are on that journey, the better, because ultimately that’s the type of structure that’s going to be both valuable and efficient.

Brent Trimble: Tom, you just gave us the title for the podcast, so it’s going to be “Consultant, Heal Thyself: The Roadmap for Increased Valuations and Glorious Exits.”

Tom Rodenhauser: You do know I used to write headlines for a living.

Brent Trimble: That’s right. I mean, listen there it is.

But Ramone, from you, that same thought and it sounds like you’re in it. You’re in the work of helping firms. But for the firms that haven’t maybe started this journey, what would be your advice?

Ramone Param: Well, we see so many leaders, and what you said Brent, was actually, let’s say, unsurprising because we see so many leaders that we speak with who are just so busy working in the business, they haven’t really stepped outside to take a look at their firm strategically.

That’s something that we believe is very important is to take that step away, objectively have a look at your business and the strategy, the operational improvements that can be enabled, the direction that you’re going in. A lot of that, you might want to work with an advisor or at least have a look at objective benchmarks in the industry to get a good gauge of where your business is performing against the broader industry.

Then it’s all about also having conversations in the market to understand where you’re positioned. A lot of what we say to businesses that are undergoing an operational improvement and are reviewing their business is considering that optionality, having there to speak with, for example, different investors in the market, even if they are 12 to 24 months, 36 months away from considering an event, but getting a good handle of how the outside are viewing their business and the different strategic options that might be available to them, I think is super important for buyers at some times and leaders of consulting firms that get just too stuck in the business doing the work and haven’t really had a step outside to have a look at their strategy from the outside perspective.

Brent Trimble: That’s fantastic advice. It’s interesting you note benchmark against like firms in the market, peers in the market. We benchmark a lot of firms against the SPI research, which is a longitudinal study. It’s been in the market a long time. I think the index is something like between 800 and 1,000 services firms. They had a really interesting term. Tom, to play off consultant, heal thyself, which is heroic maturity. You get to a month, a quarter end, a year end close. The books are closed, but it’s been done through spreadsheets. Everyone is ready to just take a few weeks off, but you can’t because there’s the tyranny of the now in consulting and client work goes on. But heroically, you achieve those results, but there’s a lot of pain to get there, so that’s fantastic.

I was really looking forward to this episode after reading the report. I do not think, I’m going to say, I hope for our listeners it has not disappointed. This has been packed with relevant, actionable knowledge. I’m going to read the title of the report and then the website where listeners can find it. The Private Equity in the Consulting Sector, an Evolving Playbook to Transform the Industry is the name of the report that we were referencing. It’s fantastic. You can find it on the kennedyintel.com website.

Additionally, Tom and Ramone and the Kennedy team have started their own podcast, so we’ll do a little cross promotion here. It’s called The Consulting Monitor and talks about themes in the consulting space, again the origins of Kennedy going very deep, back into this space, studying the consulting industry for a long time. For our listeners again, it’s kennedyintel.com.

As always, thanks for listening and tuning in. If you have any follow up questions for myself, Tom, Ramone, you can reach out to us at podcast@kantata.com. We’d love to hear from you. Tom, Ramone, thank you again for joining us. It’s been fantastic, and I look forward to continued conversations.

Tom Rodenhauser: Thanks, Brent.

Ramone Param: Thank you, Brent.

Brent Trimble: If you enjoyed this podcast, let us know by giving the show a five-star review on your favorite podcast platform and leaving a comment. If you haven't already subscribed to the show, you could do so anywhere you get podcasts on any podcast app. To learn more about the power of Kantata’s purpose-built technology, go to kantata.com. Thanks again for listening.