Episode 13 - The Nuances of Scaling Across Asia with Tim Collins

Listeners will enjoy first hand insights from former DCH Auriga CEO Tim Collins  into growing and transitioning Private and Listed companies across Asia-Pacific. Tim has lived and worked in Asia for 29 years, running businesses for conglomerates Cadbury Schweppes, Li & Fung and most recently DCH Auriga. He shares some secrets on how to learn and manage businesses across multiple countries and cultures. His expertise spans Healthcare, FMCG, Logistics and much more...

We also discuss M&A and transitioning businesses across the region.

I'm sure you will enjoy the conversation.

Questions: Heyjamie@privatenlisted.com

Transcript

SPEAKER_01 0:02

Hi everybody, welcome to episode thirteen of Private Mist. Today I'm joined by a long-term colleague and friend of mine, Tim Collins. Tim is the former CEO of DCH Arriga in Hong Kong and across Asia, and he's run many businesses across the region. I thought I'd been away for a long time living and working in Asia for 20 years, but Tim's outdone me significantly. So welcome to the podcast, Tim.

SPEAKER_00 0:27

Great to be with you, Jamie. Thanks very much for inviting me on.

SPEAKER_01 0:36

You've uh thanks, Tim. You've you've been back almost a year now, or probably about a year now. What how does it feel and and what made you come back here?

SPEAKER_00 0:47

Just about spot on to the year. Um June last year, I think we we came back. And um yeah, I mean it it there's some similarities, but a lot of differences, of course. And whilst we've been up and down quite regularly to see family and various things, I haven't actually lived in Australia um since 1997, so you can imagine that you know clearly things are very, very different than than when I left. And uh, you know, I'm still uh can recall that I think back then there wasn't even a GST, Jamie. So things uh things have certainly changed here in that context.

SPEAKER_01 1:28

I think it came in much after that.

SPEAKER_00 1:30

Yeah, it probably did, but uh it's lovely to be back and um to answer your question in uh some of it's you know um driven by family. And um at 56 I I did have an opportunity to come back and be able to spend a bit of time with uh aging parents. And uh I've got two, well, younger boys, I should say, but they're both young men now, of course, and one of them's just graduated with his master's, and the other one's uh just started the other end at RMIT here in Melbourne. So, you know, some of it was family, some of it's education, and also an opportunity, I thought, to uh to come back here and take all those experiences over that period of time and see if there weren't things that we we couldn't help other companies with down here as well. And um, in that I've formed a small group of shareholders we've got together, and there's six of us now, you know, finding our way in the world in Melbourne and doing some interesting things now already, uh helping family run businesses and small corporatized businesses with their strategies and plans for Asia, but also rest of the world, and and of course here domestically in Australia too. So it's wonderful. It's been uh quite a nice homecoming in that sense. So thank you.

SPEAKER_01 2:50

Yeah, that's great. I hope your kids are enjoying having you back. What what what about um can you give listeners some context for the the types of industries that you that you've run and and the and the countries that you've run them across?

SPEAKER_00 3:06

Yeah, well I was very fortunate. I mean, I started uh with uh an FMCG uh group, very very well known, of course, in Australia, Cabri Swept, and uh I was actually living in Brisbane in 1991 when I first joined them. Basically, it was really my first job. And uh I had six years up there in Brisbane with them and then moved on to Jakarta in Indonesia in 1997, and that was probably well, I guess thinking would have been maybe a two or a three-year stint, and then maybe come back home. And um, as it turns out with these things, sometimes they evolve, and I was very fortunate that things were going okay career-wise as well. So they for uh for good or bad behaviour, I guess they kept me up there a little bit longer. And um after about six years in Asia, I spent three and a half in Jakarta and then went up to Hong Kong and managed Hong Kong and Taiwan for Cabri Swebs. Uh, I made a move across to Lian Fong Group, and I think that was towards the end of 2003-2004, and kept rolling. And you know, through them, I guess uh it opened up a new world for me, and that was the world of healthcare as an industry, which I hadn't been, you know, part of up until that point. And um so I ran an FMCG in a healthcare business with them for the next 12 years, and um I was then part of uh a sale, Leon Fong um decided to sell our business on to Cidic Group and a holding company under the name of DCH, and you know, I continued to run that platform and then expanded that platform with their FMCG and logistics businesses, which fell in under my remit. And uh yeah, we had sort of a an FMCG healthcare and logistics platform across 11 countries in Asia and you know, nearly 4,000 people on the team. So it was a tremendous amount of growth in you know a 28-year period being offshore and um most of it very very enjoyable, I must say. So yeah, it was a great time. But uh very fortunate to have worked across industries and um really learnt a tremendous amount from the the teams that I work with, the the companies that I was working for, of course, and and the very you know the very rich list of customers that that we had across the region. You know, we literally had a who's who of uh FMCG and healthcare groups that we supported across Asia. So it was a wonderful time.

SPEAKER_01 5:56

Well what just in that context, you have had a very storied and celebrated career. So congratulations. What what what what are the the nuances of that you've seen from working between private and listed companies? That's a play on the on the podcast, but you've worked for both, you've acquired private businesses and listed businesses. But how did you feel working for both and and and you know operating in in both those sectors?

SPEAKER_00 6:25

Yeah, well there I mean running businesses has you know, generally there's there's some similarities, of course, and uh respective in industries too. Um uh once you've sort of reached a general management level, uh there's there's some you know key things that run true across industry and and country in that sense. So um whether that's a public or private situation, um, that's really important, I find, um, either side of that equation. So if um if you're listed, the accountability is a little more obvious, and um obviously anyone who's interested in you can pick up your half or your annuals and and get a pretty good idea of you know um not just your financial performance but uh your commentary particularly is important as a listed company in terms of making sure you're guiding your shareholders and your market um respectively. Um whereas private, you probably do have some advantages in getting yourself fit and ready if you wanted to ever divest, sell, or you know, acquire yourself into something bigger, or perhaps even have an ambition to IPO your business yourself. So um I think having worked both sides, uh depending on the situation, the business that you're uh you're working on, um both of those scenarios have their pros and cons based on the performance of your business and you know the respective period of time that you're dealing with it. So um I've seen and been able to work through the advantages of both sides of that. And obviously when you're listed and things are going well, the market tends to cheer you on a little, um, whereas privately you don't quite have the audience, but uh invariably you you can still have stakeholders that have you know either a capital interest in the performance of a private company, or as is often the case, you you you could be working for a family office, and um uh you know the family have obviously interests in the performance of the business too. So yeah, I've been very lucky that I've worked both sides and multiple industries at that point.

SPEAKER_01 8:54

I think you know, we we we're both um talk about mergers and acquisitions. We we've done it over the years. But would would you would you agree with me on this, or I'd I'd like your take on this for listeners to get, is that it's just easier for to manage up, manage down, or make a decision in a private company in terms of an acquisition or or a divestiture. It's just quicker than you can make the same decisions in a listed enterprise, but the time to get a result is longer. Would you agree with that?

SPEAKER_00 9:28

Uh yeah, I can understand where you're coming from there. I think um defining what might be more of the priority in the results area. Uh, I think on the private side, you get a little bit more, I wouldn't say latitude, but I I think you do have an opportunity there to, as I said earlier, like get a business ready for what ultimately I think is still a very good test of a good business. And for anyone who you know harbours the ambition to model their business and and and um have it in a in a a shape or form that would be attractive to investors, whether it remains private or it goes through a public domain, getting your business in shape is is a big part of that. And I know, Jamie, you've done some great, I think there's at least one or two of your earlier podcasts where I listened in and I heard you talk about that specific issue, um, particularly for family-owned businesses, because they they can be a little less corporate um experienced or orientated, and and being ready for that is is a big step up sometimes for for people to get their their arms and uh wrap themselves around those sorts of um expectations, if you like, but also the all the governance and compliance that comes with it. So, you know, I think some of the things that you talked about in those earlier podcasts really hits hits on that key point, right? Getting ready and making sure that you've got the information prepared and presentable is a key component to the health of your business overall. Um, so I think whether it's public, whether it's listed, if you really want to have a good benchmark that you're working towards, um, it is definitely, in my view, it's it's it's about being ready as if you were going to be in front of investors, whether that be you know a public situation or a private one still.

SPEAKER_01 11:37

There's certainly a lot more visibility in in public uh business and accountability for you know year on year. But how did you navigate managing up and managing down? And and the context for that is either acquiring or divesting businesses in country A, country B, country C, which are all different. How did you navigate that uh over the years?

SPEAKER_00 12:03

Yeah, well, look, I mean, if you're sitting in a a listed company, I think there's a couple of layers of scrutiny. I mean, you've got your internal objectives and goals and measuring against them. Um, you have market expectations, of course, and investor expectations, and they'll they'll often be present at either investor relations roadshows, so that's typically done in the bank boardroom or the the funds boardroom where you may, for key strategic stakeholders, give them um one-on-one presentations as well as public ones to your your public shareholding at um your annual or your half-yearly report. Um so it you know, I think it's very important uh in terms of managing that. But the third element that listed companies provide the opportunity to adhere to governance and compliance, of course, is through the the listed status itself. So you've got a whole set of rules and regulations that we all are bound by in terms of our reporting standards, etc., for the for the listed bosses that you're on. So I would say that you've got an extra level of, as you call it, transparency, and um you have to make sure that your you know your teams as well as um your systems are there to support you in making sure that that that is clear. Um one thing that any investor doesn't like typically is just surprises. And the moment you, you know, if you if you leave things um and deliver a surprise, I think that's usually when uh well I shouldn't say a surprise to the upside, of course, is welcome, but surprise in terms of any risks is it's something that you know requires a different management, and and uh obviously there's rules and regulations about how you um are required to declare those sorts of events should they be be relevant to do so.

SPEAKER_01 14:13

So you know, I think it's a good point. Investors uh can they just don't want surprises, they can manage good results and bad results, and sophisticated investors have obviously go across a number of things, but surprises and managing is the same, right? You can say to your staff, just don't surprise me. If something's bad, let me know about it and we can deal with it. And I'm sure you you you had to deal with that quite often uh across various countries, and and you would you would have did you have did you rely on Tim on your people on the ground in each of those countries and how much so? You you grew with throughout your career across all those countries we we mentioned earlier, but how did you manage uh you know across countries and across businesses? And did you have a management team in most of these places and did you rely on them? Or did you how did you do that?

SPEAKER_00 15:06

Well, it's it's it's a great point about um transparency and and cultural transparency that I guess you're touching on there, because inherently some markets are just more transparent culturally as well. And I think um some some cultures, you know, disappointing the boss or bringing bad news is not actually the thing that you you tend to bowl up on a Monday morning and are willing to go to confession straight away on. So I think you had there there is an art there in reading people, and um that does vary market to market. Um, some people are very, very good at playing poker face, and um you have to be cognizant that um to challenge, particularly challenge publicly, um has its risks in certain markets and um your approach to that and how you empathize with the situation, but more importantly, without question, the bottom line for me always came back to whether they were willingly sharing you know some of those challenges with you or not, once you're aware how you handle and approach that is is really important to making sure that you can keep things moving forward. Um, you don't want you know a sort of a burial ground and then a pile on if that makes sense in that and it there is a risk there that if if if you do sort of create an environment where you only want to hear good news, you don't have channels or you know methods to support getting the uh you know the the challenges surfaced through. Um you can find yourself you know knee deep in uh a position that you don't want to be in relatively quickly, you know, because these these businesses tend to be always growing to some extent. They can be good growth and bad growth, but you tend not to have an issue around market growth, etc., across most Asian markets. They're all growing. They've all you've got big populations, they've got market share opportunities, you've got all of those things that are available to you. So you don't typically sit there and say, well, I'm not going to grow the business. It's going to probably be growing. And with that comes all of those risks and challenges. You know, as I said, you know, sometimes sales growth doesn't always mean it's good sales growth. You know, the quality of that revenue may not be right, but it mightn't be as culturally um applicable that people actually tell you, even if they know that they're over-discounting or doing things with customers that uh are just getting you know volumes and sales, but the quality of the sale is not there. So um I've seen a lot of examples of that in that sort of 28-year period being up there. And you know, you really do need to make sure that you've got um the ability to read the room, and uh that runs both in systems and financial structures, making sure you you're over your numbers, but it's also about the people and fundamentally just being able to you know pick those nuances and cues with the people to know when you know it might be time to to uh dig a little deeper and and provide support, right? Because at the end of the day, you've still got to move it forward.

SPEAKER_01 18:34

It's a really insightful context. I I often have people say to me, I've got an Asia strategy. And I look at them and I go, You don't have an Asia strategy, you've got a country or a couple of country-specific strategies. Asia is very diverse, and there are different, as we've said, new uh cultural and regulatory nuances and and what have you. But the point that you just made for anyone that's got a a potential, you know, look look ahead to to grow their business or scale their businesses across Asia is the way you deal with people in each country and the messages that they're giving you, whether it's about how we market or how we sell something, very important uh context that you provided there for people. Because it is different, Tim, in in every country.

SPEAKER_00 19:22

It is, and um your sources of information, you know. Um one of the things that you know, I still I was in Hong Kong again last week um catching up with you know various banks and um you know acquaintances over that period that we'd been there. And it's very interesting when you go back to some of the old haunts, if you like, from your offices. And and I always, you know, this was always a really good indicator to me that when you walked into a a site or an office location, I used to always look with my management teams, and I would the the first giveaway usually was um someone who was greeting you at the front door. It could be the reception team, it might have even been a tea or a coffee, you know, someone bringing in a tea or a coffee for you. But it's amazing how those relationships and and the cues from those relationships tell you a lot about you know that culture locally and and how accepting it is. So uh without labouring it, I mean, when you go back last week, you one of the things that was great, I I used to find the reception and the tea ladies and things like that that some of these times had attached to these businesses, you know, a tea lady in Australia would sound like something from probably the 1970s, I guess now. But um in Asia, as you know, it's still quite a courtesy to have staff serving as part of um as part of the the structure when you're addressing customers and other things. And um they are remarkably good at giving you some clues as to what's going on in a business locally. So um I never walked past them, I always greeted them and made sure that you went around and and um you could deal with you know across the floor as well as you know behind closed doors, if you like, for lack of a better term. So, you know, uh personally I I always thought that was a good insight. I thought good management, good leaders in our countries had that ability to be able to, you know, inspire, if you like, the whole organization that it wasn't set just around a sort of a hierarchical structure, if you if you know what I mean, right?

SPEAKER_01 21:47

So I think I think that's that's a pretty cool point. I remember in in Hong Kong I worked in uh Chung Kong building for quite a while, and Li Kai Sing would come in, obviously under high security every day, but he would talk to the And the people at the front desk and you talk to them.

SPEAKER_00 22:03

There you go.

SPEAKER_01 22:04

I've never forgotten. It's really it's really cool. And I think uh there's a lot of humility in Asia as well across those things, and you do pick up a lot of signals from from people that you wouldn't expect. Most people just go straight to the top. And I I I it's not a criticism, but I did find that people that flew in and flew out that were running businesses from different regions, whether it's Europe or or North America, they just didn't sometimes have the grace of people that have been on the ground for a long time in Asia and know how to navigate those situations that we just talked about. So uh it was more this is how we do it in Europe and this is how we do it in North America, so this is how you should do it here. And it's actually vastly different in Asia, to be done, to be honest. Would you agree with that?

SPEAKER_00 22:53

I would agree with that, Jamie. Yeah, I think um, you know, the risk is that you you you may be busy and you you think that there's a lot of things that you've got to get done and you walk past some of these opportunities to just sense the mode. And um, you know, I always made a point of at least taking some time out of every trip to have ticked that box with your team. So yeah, totally agree. And I can really understand you know what you would have seen at Chung Kong Holdings Building too, because you know, it was an art. It was it was actually an art form that you know those those senior people um still had the ability to to bring the whole team along in the journey with them and and give them a little bit of respect on that way. So it didn't matter if you're a billionaire, right?

SPEAKER_01 23:40

100%, 100%. Look, I just I want to uh segue in into I guess the vestiges and and acquisitions. I'm I've got a theme running through the podcast. Obviously, age is a big theme, but there's scaling and transitioning of and I'm talking about baby boomer businesses, a lot of yours were were were bigger corporate entities, but across the countries of Asia, was the the consideration in divesting a business that was potentially not core, non-core, sorry, or acquiring a business that you thought it would help you scale and roll up in a country, were they different? How did those conversations come up? Did somebody bring them to you, or did you as the as the senior executive, the CEO, go, okay, that's non-core to our healthcare business. I need to to move it on, and then or did you ask somebody else about that? Did they come to you and say this is non-core? How did you manage those sort of things?

SPEAKER_00 24:42

Yeah, well, I've had a bit of both, actually. You know, we've had businesses where we've invested and grown, we've grown organic markets without you know, um acquiring assets to get into them. Um and as you well know, I've been on buy side and sell side of a number of deals through that that time up there. Um I think there's a few key things. I mean, um I think I said earlier, I mean, it's really important to get the best people you can to work with. And uh I think building a really strong management team and and having you know good crew on the journey with you is it's a cliche, I know, but it's very true. And I was given that advice very early in my own career back in Cabri Swept. Um our chairman was out from the UK and visited us in um Indonesia and also in Hong Kong, and you know, it was one of the key things he always reminded us. He said, just get the best people you can, right? Work with the best people. And um, I think they were big believers as a as an organisation back then, Cabri, that um there there was no one that was the smartest in the room, you know. I think the sum total of the room was where the strengths lay, and and they didn't sort of subscribe to that, you know, there's there's always got to be someone having the last word kind of thing. It was always a very open dialogue and debate. And I I value that. I think you've got to have really good people that give you some diversity of opinion, are willing to speak their mind, irrespective of culture and other things. And you've got to facilitate and make sure that that ecosystem's encouraged, you know, when you're having your management reviews or when just as we said before, when you just walk on the floor, excuse me. Um so I think that that that's part of it. Um, and it really wouldn't matter if it was a listed company or a private company in that context. You know, I think having um a really good structure and team around you is not negotiable in that sense in terms of where you want to get to. Probably the um second thing across the region is then you know, trying to understand, as you said, market to market, the little cues are going to shift and they are a bit different. I mentioned earlier that you know some people have a pretty good poker face on, and others, you know, you can you can just sort of tell, you know, they can't help, and I'll break out in a big smile or whatever it might be to sort of um share how they're feeling and thinking about things. But um you've you've still got to create and facilitate an environment that the things that you need to know you can get to rather than the things that people and and sometimes you know we all have a little bit of a habit of trying to sort of smooth off, if you like, the edges on on the harder news or the challenges, and and everyone loves to jump on you know the wins and the successes. So um, you know, I think the art of management there is with your good teams of people is to try and draw out both sides so that good and bad is not so much the issue, it's the not knowing and the surprises that are the issues. Um and then with everything that I ever did, whether it was buy sell or whether it was listed time or or not, you really had to make sure that you supported your teams with great systems and you know, common ERP, um, international accounting standards and minimum, and then local regulatory compliance and governance, whether it's on accounting side or whether it's say in healthcare, where you know each ministry of health, market to market, had their own set of rules and regulations. You had to make sure that your systems fully supported your operating teams and businesses on the ground and that they were compliant at a local and or a global level for the transparency. The second part to that, of course, is that you need to be good with numbers and be able to spot areas that just don't look like they're aligning the way they should. And that can often be uh sometimes it might be the first clue you get to that that something else is going on in a business that should or shouldn't be happening. So, you know, I think all of us tend to, if numbers are good, you're like, oh great, you know, and maybe you become a little bit complacent and enjoy the success a bit, but um I always saw it both sides, you know. If things were going well, I would be equally as curious as if things were not uh meeting the standards and and getting to the levels that we'd expected for that business. So um I hope that helps. I mean it's a little bit of a roundabout way of getting there, but you know, I think you've you've really got to have great people, good systems, be compliant, be very aware of the governance and the regulatory side, market to market, and then um make sure that you've got the ability to, if you like, penetrate and draw out information that's gonna give you um a good sleep every night.

SPEAKER_01 29:49

That's good. There's a lot to unpack there. Thank you. When when you as you grew in your roles and you took on more people and and more countries, how did you manage up? Well was there a skill in in managing up of you know, you had worked in big organizations.

SPEAKER_00 30:07

Sure, yeah. Yeah, look, I think some of the decisions, you know, particularly early career, like in the 90s, um, 80s, 90s, I guess maybe that period, um, where I joined Asia. Um probably the multinationals had that. Do we go local? Do we have expatriates? How many expatriates do we have in a country? You know, that sort of stuff. So there was um you know some confidence perhaps as a as a multinational, drawn by having you know some translation there from you know, having an expat team on the ground. But you know, through the 2000s and you know, as I'd left Cadbury Swept, I think there'd there'd been almost a shift on that. And um, you know, it was more about how international your management was, perhaps, because I think part of the you know the the skill expectations there were that you weren't just transferable in business skills, you're transferable in cultural skills and and in market skills, so that you know you'd you'd learnt to become more accountable but also more adaptable to varied experiences and and different scales of business, market to market. So I think that was something that I experienced firsthand. Uh, and then managing up, you know, I've managed up to sort of the sort of the western side, both from customers and and also from stakeholders, and and um I've also had you know um a long period of time where I was part of Chinese conglomerate and or um you know listed Chinese company structures. So how you manage up there quite honestly, Jamie, again, you know, there are a whole lot of things that are very similar. And um when you're running a business that is essentially there to add value, create value, those sort of metrics pretty much you know run true across all of those scenarios. Um what differs a little perhaps is apart from obvious things like translations of languages and and you know how we might you know um put an acute on certain pronunciations of words and and change the meaning of things, which all cultures do. Um but yeah, I mean that there's clearly differences too that you have to make sure that you can appreciate, respect, and adapt to in the environment and the setting that you're um you're placed in. So um you found I think the the best way to describe it is this no one meeting was probably the same in some ways, so you you found that it was constantly changing and you were fitting you know to some extent around the circumstances that you were in. Um and it's not to say that you're manufacturing yourself to just an audience, but um you certainly had to be aware that how certain things were acceptable in one country or one meeting room, that could be very different, you know, as you move on to the next one. So you know, I I found you know in some ways that was quite an enjoyable part of the experience too, because you did learn that uh these things work here, but they just don't work here, and you're not going to be effective whether it's managing up or down in the structure by um by not being able to sense those things and and also to be able to um articulate them.

SPEAKER_01 33:51

To me, that that's music. I think respect for the environment and respect for the culture that you're in is important when you walk into the room and you've just clearly articulated that. So I'm sure the listeners will find that fantastic. It is this is this is a uh an off-the-cast question, but is there a is there an a something that you've done that you're really proud of? That you don't have to name an example, but sort of circa. And is there a challenge that you thought I missed that opportunity? Just is there a story that you can convey?

SPEAKER_00 34:24

Oh, look, I think the probably the proudest thing is that, as you do, Jamie, I mean, to go to Asia probably thinking it might be two, three years. In fact, my first contract, I think, was two plus one. They were the terms of the contract, right? Um, so you didn't really have a horizon much beyond that. Um I think some of the proudest moments uh you know, when you reflect back on that, that you've you've come out of your comfort zone in your your home, your culture, and and and what you literally cut your teeth on culturally and and from a business sense and a network, gone out into this you know, whole new world of uh opportunities and um and being able to do it for as long as we did it, um, you know, I think you'd feel the same, right? You know, 20 plus years uh in anyone's sort of measure is um is something you can be proud of. And you know, I thoroughly enjoyed, by and large, most of that experience, right? Because um you saw good progression for yourself, yes, but you you look at the growth and generally the you know the um ability that you were having to play a role in positively you know influencing people's own careers and lives and livelihoods in many cases, you know. I've run factories across the region, as you know, as well. And um, you know, factory floor workers are very dependent on you know a business being healthy just for their jobs too, and to be able to create growth for those um across all layers in a in a business structure, and I think is one of the more rewarding elements of it. Um a particular highlight for me, I I do remember when I left Jakarta, it was in October of 2000. Excuse me, and I think there was about 300 people that that came to the airport. Now I wasn't sure whether they're all there to make sure I got on the damn plane and left. But um, but it was a very emotional moment, and I was quite emotional myself, I must say, that um the uh the tissues were getting a good workout. But I think when you see something like that, you know, it's not about you know differences, is it? You know, it's just a common respect that you've achieved. And I think, you know, when you when you complete whether it's a an acquisition or a divestment or a you know, just a good customer experience, even all of those elements, they can be so rewarding and really positive. So I think to have done that for 28 years um and pretty consistently, I mean, I haven't won everything by any stretch of imagination. I've had my share of uh of mistakes and challenges, as you said, along that journey too. But I think to have done that and and to got you know to get to where you did over that 28-year period, it's a pretty special moment for me. You know, when I look back now, I I I feel really positive about that, and that in in so many ways you've been able to contribute in a positive way to what you did with the people you worked with. Um so so yeah, it's a bit of a long answer, but yeah, I can be very rewarding, can't it?

SPEAKER_01 37:52

It can, I must admit, you're a pretty pragmatic operator because I remember over the years there are times when I've tried to get you to acquire businesses that I've been working for, and there's been times when I've tried to pry businesses out of you that you've owned, and uh it's never been easy. You've always been very pragmatic. There's a few. I mean, I I'm used to the to you know, advising businesses and and mergers and acquisitions, but sometimes you try to use some leverage and say, can you look at this properly and can you or can you divest this? And you're always pretty pragmatic, Tim. So it's probably for me root canal, but no anesthetic. But it's always enjoyable.

SPEAKER_00 38:34

Great way of putting it. Well, you know, and and hats off to you too, because I think in fairness, you've always tried to um deal with uh get getting fair terms because you and I both know that if it's too one-sided, it's probably not going to happen. And uh it it's it's either too far one way that you know someone always wants to buy it at the lowest price, and the other one always wants to sell at the highest price, for example. And you know, once you move beyond the buy-sell price points, there's a lot more to deals, as you know. And um uh I think that's a great word to describe it because the pragmatism and and knowing that um integrations and successful integrations are not always that easy. And there's there's a whole, as you know, a graveyard of things that should have been but ended up not being. And um you don't want to be part of that actually. So I think you're very good too, in fairness. Um so thank you for your compliments, but I'll give you one back in that sense because I think you also give pragmatic advice, whether it's on the buy-sell side. And I think that's important. You know, you've you've really got to understand what's necessary to get a fair deal and something that's going to provide continuity to respective parties. You know, once you've sold and moved on, sure you could always say, well, that that chapter's closed. But I don't know too many people that have sold businesses that haven't still had some interest to see how it's still going, if that makes sense, you know, and and I've had relationships with some of the deals that I've done and continue to have relationships. In fact, I met with some of the um the people that I've done deals with and and had catch-up lunches, dinners, and that last week in Hong Kong for that reason. Because there's still a genuine interest from my part to see how they're going and how all the things that we you know we worked on together, and you know, that things are still working out okay in that sense. So um, you know, to me that's a really important measure of an MA. It's not just getting to the point that the actual deal's done, you know. Um, it's it's how's it done two or three years later? You know, is it still holding up?

SPEAKER_01 40:54

You've always had a bigger baseball bet than me, Tim. I've always you've always had a much bigger uh landscape to make a decision in. Mine's always been bringing something to the table. But I do agree with you that owners of businesses they actually care after it's been sold. It's the the price can be matched. You you agree on a price, but the chemistry and the dynamics of how you integrate or scale a business or do whatever you want afterwards, the original owner or founder of that business still wants as a legacy for it to perform. No one wants to go to bed and go, I own that, it went down the off the cliff. People want to go, I own that, and it's doing really well now. And so I think your point is is really good. Oh, you better start. There's so much more. Yeah.

SPEAKER_00 41:41

Yeah.

SPEAKER_01 41:41

Look, I I um I agree.

SPEAKER_00 41:43

And you've seen a lot of those sort of businesses, right? Where you've had family offices or family-run businesses, and and one of the key things that they are concerned with is just that legacy, that it will, you know, still in some shape or form be continuous. Um I've seen many of those, and I know you work with a number of them too. And uh it's very important to owners, you know, as part of that transfer that you know, some of that legacy is going to be carried forward at some shape.

SPEAKER_01 42:12

Yeah, I think it I think we just to just to finish off, I've really enjoyed this. We could talk for hours and we could do many of these, but in the in the baby boomer business, or you know, sort of the the the 62 to 80 year olds, which I talk about a lot, they've really got to find a way. They don't know that they're not professional buyers and sellers of businesses. You and I've sort of built careers out of doing that, but they want to extricate, see the legacy continue, but they often need some support in how to do that because they've grown the business with the their fingernails from the you know, from a young age, and they've done it well, and their customers know them, and the kids don't necessarily want the businesses, they want to do other things, and the parents probably want the kids to do other things, but it's about getting being able to transition that business and getting the right advice as to how to do that. I suppose you you you're looking at that with the group of people that you're with now back here in Australia as well.

SPEAKER_00 43:09

Yeah, it's very true. Um the the team you know that I'm working with at six figures now, you know, I think the disruption that's going on in Australia, potential disruption, is gonna raise increasingly more of these um opportunities for the you know, the as you said, the people that have sort of had the sleepless nights, they've gone without, you know, just to get get the next month through and things like that. I mean, a lot of that's coming up for review. And yeah, you know, I think you've been in the box seat of a lot of those things as well yourself. And um I do agree. I think sometimes one of the key things that they they just want to know that they can still have confidence that that continuity will be in some shape or form at least maintained. And um you do you do. see a lot of that here. You know, I think there's there's an incredible depth of fam good family businesses, as you said, that are reaching that point now where either you know there's not a bat and pass in generation or there's other things that are driving decisions to to make a decision on what the future of the business is going to look like. And I know some of your podcasts do cover the topics of getting ready for that process as well. That's really important. But to your point, I think as an owner and for all that period of time that you vested in getting that business to where it is, the last thing you want to do is see it go somewhere and then almost disappear and um not mean so much. So yeah it's a really good point very emotional point I think for an owner to to have to transition.

SPEAKER_01 44:47

It is and just to finish off it go it goes back to what you said earlier. You've got to have good advice around you. I mean you I've said it on one of the previous previous podcasts if somebody tells you your business is worth eight or ten X and they're not an informed person then it sets expectations in your mind and you just you never recover from it. So you need to get proper advice where you can get a handle on on what is the value you've created and how can that be rolled up into something else rather than grandiose you know go and have a coffee with someone and go, oh look 10x it just doesn't work like that I don't I I don't think it does.

SPEAKER_00 45:26

Yeah it's a great point. I think of all my experiences I think there was only one where I was involved where the valuation was stretched to put it politely I guess and then um living up to that expectation that really can be quite a challenge. So you know I was rather fortunate that in the situation we're in we managed to get through that and and seriously create value for you know the change of control. But um it's not always the best thing to sell as you to your point like go for that really high multiple but then you know the premium's been paid and you know on the buy side the last thing they want to do is start impairing things by year two, year three. It doesn't look too good. So um to that point we made about how you've always operated I think being fair reasonable is sensible and it's probably got um a a fairer basis for both parties to make sure that the business can continue to prosper and grow. You know sometimes when it's a little bit too one-sided as we mentioned you can um create some pretty significant stress um not too long after the deal closure itself you know the cracks can appear so um I I I really support what you've done in that sense and and how you're communicating to an audience now of the importance of just being realistic about what you really want out of the deal.

SPEAKER_01 46:57

And um yeah we all value money we get that but we also value what we've built and um you know making sure it goes to the right place and has the opportunity to continue on a lot to be said in making sure that that happens it it it really is an art not a science and I think a lot of people you know hang it out there that look it there's a methodology to go through to get an emergent acquisition done but there's not the way businesses are run, the people that are involved the nuances the way just the whole operating system the chemistry look if you if you don't have chemistry when you get to the the final stages of of a transaction it can fall over in the last week or two.

SPEAKER_00 47:37

But I look I think it's an art not a science and and you know you're able to speak to that point a lot better than I am well that's you know as you said we're closing up but um I have been just recently actually on an advising role for a um a deal and it was interestingly an Asian buyer an Australian based seller and one of the the disconnects to your point was they had not actually met the buy side owner so they were actually dealing with sort of the management IC team rather than the actual owners and that's unusual as you and I both know um so that was the first thing that you know my feedback was to this particular seller I said well you probably want to understand why you haven't met the owner yet because it typically you know the relationship and that the chemistry has to be there. So as you can imagine that one didn't as far as I know it hasn't gone forward.

SPEAKER_01 48:44

So yeah it's a really good point you make there I I'd want to be I'd want to be talking owner to owner. But anyway or I would advise someone I'm sure you did too. Look I I'm I'm grateful I'm sure the listeners are too to have had your time today uh on the podcast it's really good Tim and and thank you for your insights because they're they're relevant they're credible and and they're lived experiences which is what I like to to to have on the podcast. So thank you for for joining today.

SPEAKER_00 49:18

Thank you for having me Jamie and uh to the listeners too um I'm sure they're appreciating the sort of things that you're putting out on your podcast and hopefully they're helping some of them as they go through their own thought processes and uh leads up to perhaps what they have in as an ambition for their businesses going forward. So thanks for your time and it's a bit hard to cram 28 years into 40 minutes.

SPEAKER_01 49:44

Sure is but listen everybody thank you for listening to Tim in particular and thank you for listening to this episode of Private Enlisted if you've got any questions you can get me at heyjamie at privateenlisted.com and thank you again and thanks Tim and we'll talk to you later good on you thanks Jamie