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Season 01, Episode 08

President & CEO of GrowthForce, Stephen King

President & CEO of GrowthForce, Stephen King

About the Episode

Today on The Fastest Growing Companies podcast, we’re talking to the President & CEO of GrowthForce, Stephen King.

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Full Transcript

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20:57

Chris:
Welcome back. I’m Chris Ronzio. And today we’re here with Stephen King. He’s the CEO and founder of GrowthForce. Hey Steven. Thanks for being here.

Stephen:
Hey Chris. My pleasure. It’s fun.

Chris:
So tell us real quick, just what is growth for us? What do you guys do?

Stephen:
Sure. GrowthForce is an outsourced accounting department over the web that helps focus on companies that are frustrated that they’re not getting actionable financial intelligence. They can’t make decisions with data. They’re worried about cash flow and they are, you know, they’re spending a lot of money to do things very manually. We give you a team and a QuickBooks-centric, smart back office to automate the whole back office and give you a dedicated bookkeeper, accounting, and controller. So you get data to help you run better, grow faster and make more money. And then we help you as an advisor to run better, grow faster, and make more money.

Chris:
So if finance and accounting, aren’t, someone’s passionate thing that they should be doing in their business. That’s why they hire you

Stephen:
Guys. Yes, exactly. We help take it from a weakness to a strength.

Chris:
Okay. So why this business tell us the founding story? Like why, what came to start this? You

Stephen:
Know, my, my, uh, I’m a son of an Irish farmer. My mother was a, you know, a daughter, Irish daughter of a farmer’s daughter in the poorest county of Ireland. And, uh, you know, the oldest son has to work the farm. In my case, she married, uh, somebody from Dublin, uh, and, uh, he became an accountant and the family farm became accounting. So I was in the basement, helping my dad add up checks and, you know, help him get tax returns done so we could make a couple of extra shillings. Uh, and I just loved it. I’ve been doing it for 36 years. I’ve been a CPA through this May 6th recession. And, um, you know, what I, what I really find now is helping businesses achieve that American dream and helping nonprofits. We, I got to be the CFO of amnesty international after Bruce Springsteen and Peter Gabriel, extincted their worldwide tour. So we know a lot about mixing accounting with fundraising. So, you know, it’s just a passion always has been.

Chris:
I love that. So, you know, I’ve bumped into a lot of people over the years that do bookkeeping or outsource CFO kind of services, but not many of them are very few that I remember have scaled the business as you have. So you were saying right before we jumped on you’re at about 56 people today, how did you grow that quickly? Like, what do you think is the secret sauce to breaking past a, a one or two-person shop to where you guys are?

Stephen:
It’s people that drive profits full, full stop. I learned that you know, the hard way in my, in my late forties, 15 years ago, and you need both a human capital strategy and a financial management strategy to, to, you know, achieve success because, you know, I’ve been doing a lot of accounting for a lot of people. And I look at the difference between the companies that are wildly successful, living that American dream, and the ones that struggle to survive. And it’s the ones who have built a high-performing team that stays together for a really long time. That is passionate about what they do. Those are the companies that make it because if the people stay a long time, the clients stay a long time.

Chris:
Yeah, yeah. That continuity is important because you get a relationship with whoever’s doing your books and if they leave, it probably rocks your trust, right?

Stephen:
Yeah. You start to think, oh, now, you know, the new person comes in. Can’t possibly know as much as the person who’s been working on the account for six years. Right. And so now it’s like, oh, well, you know what? We might as well hire somebody or, you know, let’s, let’s see if we can save some money because they’re not great. The value goes down. Our small businesses run on tribal knowledge, a member of the tribe leaves. So does the knowledge,

Chris:
Yeah. So, so take us back then, to the beginning of 2005, you said, who were your first couple of hires? What did you first take off your plate to get this started?

Stephen:
Uh, the accounting, uh, accounting manager, QuickBooks systems. I hired management down to bookkeepers and knowing that a manager could do the bookkeeping, but bookkeeping couldn’t do the the management. I said at first, the first thing that I did was define why do we exist? What’s unique about our business. You know, the riches are in the niches. You can’t, you can’t serve everybody. And, and you can’t be all things to all people. So, you know, mission, vision values. I got lucky, you know, I, I started a company called virtual growth, right at the Dawn of internet Netscape. 1.0, came out in 1994. I started virtual growth in 95. We raised 43 million in venture capital funding. And I made a lot of mistakes along the way, right. It got to 270 people in seven cities doing the exact same business I’m in right now. So I was a little bit, a little bit fortunate to get a reboot, right.

Stephen:
To get a chance to learn. And I realized that that single, simple unifying, um, mission that Jim Collins talks about in good to great is so key. So we started with, we don’t want to just do the books. We want to help you make more money. We want to help you live the American dream. And so, you know, that finding your unique selling proposition, your USP helps you define your customer. So then once you figure out the customer, then you know, okay, what kind of skillsets do we need to hire? What kind of person am I looking for? And so, uh, the way I learned to do that, even as a very small company, was to be intentional about the culture with everybody. You bring on, make sure that this is somebody that has the same values that have the same beliefs. You can teach skills, but you can’t teach snap. You can’t teach accountability. You can’t teach meaningful work. And by finding people who are passionate about serving small businesses and nonprofits in QuickBooks, it was really easy then to help you, you know, build a team.

Chris:
So did you feel that visual component was missing in your first business and that’s it and that’s something you wanted to do-over?

Stephen:
No, the culture by design was missing in the first business. And that’s exactly what I, I remember turning around. At one point we were at a management team meeting. We had like 40 managers and I remember thinking, oh my God, these people are jerks. How did, who hired them? I would never work for that guy. Wow. And yeah, there was a lot of backbiting and a lot of just bad toxic culture. And, and, you know, it was the.com days. Everybody was fighting for stock options. You know, it’s just, and, and I, and I, I, that culture by design, uh, even as early days helped, uh, you know, we, I got to S you know, sell that company, that virtual growth to Insperity. They rescued us after September 11th. And so I, um, I learned a lot about the HR side, because I was now working for the CEO of a $4 billion PEO and outsourced HR company.

Stephen:
And that’s what I realized when I walked in the door there, the first time I was like, wow, there are 2,500 people here who love what they do, who, who are passionate about serving HR to small businesses and they don’t quit. And I learned, you know, over the next three years there, that culture by design, and then it became a client right away when I spun off. And what they, what they did was they helped us figure out the culture by I had six or seven employees. And they said, who, who’s your best? Who’s the person that you would say, epitomize, the kind of values that you would like to repeat. And it was really easy. It was really easy. I said, Marsha, she was a bookkeeper. She was going to school at night at lone star college, her, her, I was on the advisory board.

Stephen:
The professor recommended her. She was passionate about her job. She was so thankful to be able to do this work and then go to accounting school at night. And then she, you know, she always did what she said and she’d say what she do. She was accountable. And, and she was a problem solver. She could, you know, find on YouTube exactly how to do whatever it needed to get done and was a team player. She was the one who walked around every day, around nine 30, 10:00 AM. What are we doing for lunch, Chinese food? Do you want Chinese? We had a Chinese last Friday who wants Chinese. And so, so we literally built that core values around the behaviors of the people that we love the most such

Chris:
A good tip. And I want, I want everyone to listen to this and hear it again, that if they can find the people in their organization that are their all-stars or the people they wish everyone behaved, like those are the people that have the core values baked into them. And if you don’t have them explicitly stated, look at those high performers, look at the people you wish you had a hundred of, and try to pick apart the, uh, the, the attributes. One way that we did it in the past as if you had someone that didn’t work out, we’d sit down and talk about why they didn’t work out. And then you kind of back into what some of your core values are. So that’s, that’s another way we do.

Stephen:
Yeah. I’ve, I’ve heard some people say core values are the things that you get fired for not doing so that’s exactly what you just said, right? This did not work out because we’re firing you because of this. Well, then it must be important enough to make it a core value.

Chris:
Yeah. So as you created this culture by design what’s one hiring tip or screening tip that you’d recommend to everyone so that they make sure the people that they bring on are great.

Stephen:
Yeah. I got, when we started with Insperity’s recruiting, this was one of the things I learned is recruiting is not a HR function. It’s a marketing function. You got to think of these recruits as the most important prospect you will ever sell to. Because if you close a deal with one, a player, that’s worth a hundred clients. And so it’s a whole mindset of starting with the job announced the, uh, the art, the advertisement is we know we used to put ads in the paper that would say bookkeeper wanted, you know, I’ll tell you how old I am. It says, this is going back to paper. Right. Okay. But, but even, even, even online, you know, bookkeeper wanted a 30 or $45,000 plus great benefits, you know, uh, front of Kingwood, Texas, um, you know, QuickBooks experience, a must CPA firm experienced a plus, you know, contact this, the A  players already have a job.

Stephen:
They’re not looking for a job. They’re smart enough to go explore, to see what’s out there. You want to know, you want to understand what’s valuable to them, just like a prospect, right? What’s their pain. And what’s your unique selling proposition to help address that pain. It’s a marketing campaign. So, and there are four generations in the marketplace and each generation has different needs. Baby boomers like me. We, we have worked for people that are jerks, and we’re not going to do that again. So you need to have a no-jerk rule, right? You need our millennials who, anybody who does it says millennials, aren’t hardworking. It misses the boat. If you get them, if they’re passionate, they worked on nonstop because the devices are always connected. They want, they want to have fun. Yeah. They, they, they want to have a work-life balance. They want to live in balance, not just have a work-life balance.

Stephen:
They want to live in balance. They don’t mind doing something on a Saturday. If it’s easy. And at home, they, they, they want the latest technology. They want you to invest in their skills, keep current, but they want to have fun because it’s the journey, not the best donation. And so, so you’re recruiting for a millennial has to say something like, you know, do you want to join a company that really understands that it’s, this just works. And that you join us in our family on a journey to help explore your talents and learn the new technologies and be able to fulfill your life by helping small businesses and nonprofits live that American dream, then contact us.

Chris:
And that’s a lot different than the ad in the paper for the bookkeeper.

Stephen:
Yeah. You’ll figure out to see if they have the skills to pay the bills. You can teach skills and then, and then treat them like a number one prospect. You know, if you like, when, when a prospect comes to the office, we, we have a hybrid model. So we have a big service center in Kingwood, Texas, and you know, virtual everything. And, um, when somebody shows up they’ll, there’s an itinerary, here’s who you’re going to meet. Like when I went to Ernst and young, right. I was a senior in college and I got at the front door. It’s like, hello, Mr. King, we’ve been expecting you, here’s your day. And, and there’s an experience, you know, new, uh, new employee experience that just as a wow. There’s, you know when you show up on the first day, the business cards are printed. The balloons are there. There’s a card from your fellow teammates. There’s an announcement to the company that you walk around and it’s like, Hey, yeah, I prayed. I love the picture of your dog. It starts with, you know, that’s your most valuable asset. So they go home that night and they say, oh my God, where did I land? How did I get so lucky? And that energy pervades them for their lives over the course of being here.

Chris:
I hope everyone is listening to this because of how much Stephen is talking about employee experience, just how recruiting is marketing, and how your culture is everything. I mean, investing in a, in an, in your team, growing your, your people grow your business, like you said, at the very beginning. And so I love how much attention. It sounds like you put into this now as a service kind of business, you of course have a correlation between the number of clients you serve and the number of people that are doing that kind of work. Right. So how do you predict or forecast when you need to bring on the next one?

Stephen:
Well, we’re accountants, right? So this is what we do for our clients. I mean, we’re mad at we’re management accountants is, is really, you know, so what we’re doing is we’re, we’re, we calculate, what’s an average client equivalent, right? What is one normal client look like? How many hours have an accounting manager, have a staff accountant, have a bookkeeper. And then, and then, you know, how many clients can that team handle? And then you forecast from your, from our sales forecast, you know, how many clients are coming on. We have an onboarding process that takes two to three months for us to automate and integrate and document the whole process and then train the people. So, so there’s, you know, it’s all modeled. How many, how many prospects have we got at the top of the funnel coming down into how many proposals, how many closed deals every month, and then there are slots and you, you fill a slot up and you’re, you’re, you know, you’re, it’s like, I’m, I’m a machine. I don’t know how else to describe it. I knew

Chris:
You’d have an equation or some kind of math problem. So then thank you for breaking that down. Now, a lot of people, when they think about growing their team, struggled to delegate, they wanted to, don’t want to take things off their plate, or they don’t think that the other people will be able to do it as well. So over the years, what have you learned, or what would you say to those people?

Stephen:
It comes back to hiring the A-players, right. I mean, I, you know, I was a manager of accounting system design at Ernst and young. So like, this is my baby, I’m a process guy. Right. And then we hired, um, uh, you know, uh, the woman who co-wrote the QuickBooks pro advisor training manual. And all of a sudden I started realizing she knows more than me. It’s easy when you are hiring people who are better than you. Right. Who, who, who, who actually, you know, you trust, um, you know, I, I had a hard time giving up on sales and marketing because, you know, it’s a personal brand. Its accounting is just not the normal thing. And, uh, you know, just recently where an EOS shop, um, you know, EOS, Gino, Wickman, and traction, the entrepreneurial organized system. So you’ve got the book right there. I know, right.

Stephen:
It’s wonderful. So many people do, um, you know, uh, what, what I had to learn to do, and I just did it. Um, I just did it six months ago. So I’m, I’m, you know, I’m in the visionary role, I’m the, you know, the guy who’s in charge of the product and the, and the closing, the big deals and, and help make sure that the systems are in place and, you know, macro, macro, macro, and then underneath me, I have a COO the integrator. And, um, it wasn’t until, you know, I really had faith and trust in our Loretta, our CLL, you know, it’s easy when you trust the person and you get alignment. This is the other part, right? The EOS process does, is, you know, step one is divine, who you are your customer, and why you’re unique. This is a one-page process where you define exactly what your mission, your vision, your values, your core processes are, and then went to me and Loretta and the management team can look at one piece of paper and get alignment around that. I find that’s what lets you let go. I don’t worry anymore about, you know, are they going to do what I want them to do? No, we’ve all agreed on what we’re going to do. And I feel good about it and they feel good about it. It’s not necessarily what I want to do anymore, but because they’re, they’re A players, they’re smart. They’ve actually changed my influence, my mind. And we ended up with a better plan because it’s, they own it. Does that help? Did I answer your question?

Chris:
Absolutely. I mean, alignment is so crucial and the distinction between what you do as a visionary and what you said Loretta does as your, your integrator, uh, you know, it’s, it’s, it’s just understanding roles, responsibilities, what you’re great at, what she’s great at. And then the system works. So as long as you have alignment, that system works. So I, I love that. Um, it sounds like you’re, you’re, you’re growing, you’re doing a lot. That’s exciting. So what’s next for GrowthForce. What’s on the horizon for you?

Stephen:
Well, you know, it’s, it’s building, um, it’s building out the next level of management and, you know, the more advanced systems like profit sharing and, uh, succession planning and all that kind of stuff starts to starts to come into play. Um, I think, you know, we have these five steps to profitability. You know, one is to define your customer. Two is a culture by design. Three is written goals. The simple act of writing down goals changes everything and goal alignment. Step four is where we come in, which is the keeping score, right? But I think the most interesting part is step five, which is recognition and reward. Um, you know, and recognition being the first reward is important. You’ve got to pay people, a salary and benefits and bonuses that allow them to live the lifestyle they’ve grown accustomed to. But what we all really need is to belong to something bigger than ourselves, you know, Maslow’s Hierarchy of Needs.

Stephen:
And, and so by having clear written goals and cascading them down from the company to the department, from each manager down to the individual. So everybody has a line of sight between what they’re doing and what successes in the company, and then why success for them is good for them and their family, right? What’s the reward system. That’s what brings it all together. And, and that’s the hard part, you know, I see most of the companies we work with don’t get that far, but it’s the magic sauce because then everybody starts acting like owners. Yeah.

Chris:
I love that. So well said Stephen King, everyone with growth for Steven, built a company and sold it to Insperity and amazing feet by itself. And then in 2005 started GrowthForce, which has since grown to 56 people and counting. Uh, he’s got a lot of exciting things on the horizon. And please replay this episode again, to see how he has built this culture by design and put so much intent into how he structures his organization and gets alignment with his people. So, Steven, thanks so much for being here. If people want to reach out to you, what’s the best way to,

Stephen:
Uh, email is the best. It’s Stephen S T E P H E n@growthforce.com. Our website, you can stop by and visit us virtually. We got a lot of advice and we can answer any questions anytime on our website, which is DubDubDub growth force.com, G R O w T H force.com or I’m on LinkedIn as Stephen King CPA and Twitter S king G-Force. I love it. All

Chris:
Right. Well, everyone reach out to Steven, check out growth force.com. Hopefully, you can borrow a page from his playbook as you build out yours. Steven, thanks again for being here.

Stephen:
Okay. Thank you, Chris.

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