The Rule of 40 with Mark Simon | Ep. 112

We have the pleasure of welcoming Mark Simon, the Managing Partner for Hawkmoon Advisors, as our guest for today’s podcast. Mark is joining us to talk about his journey and share his experiences with the kind of work he has been doing to help small businesses scale, grow, and reach their goals. He also talks about what ten-million-dollar companies need to be thinking about if they want to scale. About Mark Mark disappeared off the research industry radar for a while after leaving Toluna at the end of 2019 and moving back to the UK. He joined an IT SaaS business in the UK called Datto, and after that gig came to a close, he set up a consulting business that helped small SaaS businesses get going. Mark’s journey After finishing university, Mark spent a few years in Paris, teaching English at a high school. After that, he spent most of the rest of his twenties playing the guitar in a rock and roll band, touring around, and having lots of fun. Then he went to work for a marketing agency that won a contract to take AOL to the UK. At the time, Mark was about to get married, and being a bit bored with the work he was doing, he started looking around for something new. He ended up spending an enjoyable year as an individual contributor for a company called Greenfield Online in Europe, where he learned a lot. He then got a call from someone at Toluna, saying that they were about to list the company on the London Stock Exchange, and they wanted him to lead them in doing that. Toluna Mark took a risk and joined Toluna. He now feels that was one of the smartest things that he has ever done. He set up a digital practice there, and they went to market properly. He had great fun getting them up to eight figures. An issue Toluna had an issue in their North American business, and they asked Mark to go there to turn it around, which he did. He managed to turn things around fairly quickly, and he ended up staying there for another six years before returning to the UK. What ten-million-dollar companies need to think about in terms of scaling Mark explains that at any point in your company’s trajectory, you have to think and act like you’re bigger than you are, and that applies from the CEO down to the people who you hire. Hiring is critical In Mark’s experience with fast-moving companies, he was spending 70-80 percent of his time hiring or coaching people. He points out that if you don’t do that as a leader, and you’re trying to scale, you are probably focusing on the wrong things. The people you hire Look for people who can act one level up but could also be capable of thinking two levels up. Recurring business Think about some way to get recurring business and repeatable, predictable cash flow. That will build value in your company. Incentives For a ten-million-dollar business, all your incentives need to be in line. It is vital to over-emphasize rewards for long-term contracts. Customers Your customers’ satisfaction needs to be ahead of your acquisitions. The Rule of Forty At ten million, you need to make sure that your company can exceed the Rule of Forty. That is very important for any recurring revenue business. Expanding internationally You should not expand your company internationally too quickly because that could be dangerous if you don’t have a cultural understanding of what works well in different places. A framework for hiring salespeople Interviewing salespeople can be difficult to do, so it helps to build a framework for hiring salespeople. Three things that are important to include in that process, regardless of the environment you’re in, are: Coachability A competitive streak Empathy, rapport-building, listening, and cultural alignment Also, any toxic high-achievers need to get removed from the team. Hiring a Head of Sales Hiring the right Head of Sales can be a scary decision for a CEO to have to make, especially if that CEO does not come from a sales background. The CEO should choose someone who has been a successful individual contributor rather than the best sales performer. And someone good at hiring and coaching, someone whose values align with those of the company, and someone who can move people along if they do not perform. They should also hire someone analytical and numerate. Evaluating a company from the employee side On the employee-side, when someone is evaluating a company, they should make sure that whatever the company stands for is in line with their values and culture. They should also look at the investment structure of the company, who the investors are, and how consistently successful they have been. Links: Email me your thoughts! [email protected] LinkedIn Twitter infinity-2.com Sima is passionate about data and loves to share, learn, and help others that share that passion. If you love data as much as she does, subscribe on iTunes, and don’t forget to leave a rating and review!