Scaling Up: Growth Strategies from Marc Washbourne

“What got you here, won't get you there. To continue to evolve and grow the company, you need to keep reinventing yourself.”

Today we're joined by Marc Washbourne, founder and CEO of ReadyTech.

ReadyTech, with a team of over 500 people, serves more than 4,000 customers across the education software, workforce software, and the local government and justice software sectors.

ReadyTech has been listed on the ASX since 2019, with its share price materially ahead of the IPO price.

Marc shares his insights on:
• Strategies for scaling a team and ensuring a growth mindset.
• Developing and implementing an enterprise sales playbook to secure large contracts.
• The importance of maintaining a long-term vision while navigating the demands of being a public company.
• Implementing automated recruitment processes and personality tests to identify suitable talent.

Guest: Marc Washbourne, Founder and CEO of ReadyTech
Host: Mark Bryan, Partner at Pemba Capital Partners
Producer: Martine McMahon
A Pemba Capital Partners Podcast

Transcript

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This series is produced on the land of the Gadigal people of the Eora nation. Pemba respectfully acknowledges traditional custodians throughout Australia. We recognise their continuing connections to country and culture, and we pay our respects to elders and leaders past and present. Welcome to View to the Summit. ReadyTech today has over 500 people in their team, servicing over 4, 000 customers across education software, workforce software, and the local government and justice software sectors. The business is expected to deliver over 110 million of revenue this year. And Readytech's listed on the ASX, with Marc successfully leading that IPO in 2019. Can you please go back right to the start and tell us how you came to be founder of Relitech? And CEO of ready tech. And I'm really keen to understand what continues to drive you today. I think firstly, I was probably quite entrepreneurial growing up. I grew up in the UK and I. I think we share that. I actually started my first business when I was in my teens. It's a really a classic bootstrap story. Uh, I think less common today for tech companies, but sure we, we didn't, we didn't ever raised any outside capital, you know, I had any debt in the business, so it was totally self funded. So we had to do everything right. Coding. We did the sales, Marceting, Marceting is much better now than it was back then. Yeah. And I think that's still very much part of the company today. No, we talk about the fact that all our software. It really helps communities to thrive. Uh, and, uh, you know, I think we try and shine a light on all the positive impact that the technology has. We built, rebuilt everything in the cloud in about 2008. So I needed a new partner and I was very fortunate at that time that at that time I met Pember Capital who became my new partner and we enjoyed a period I think of running the business, uh, privately as a really as a private equity investment. And that was an adjustment, but. You know, I think that I felt very well back to run the company and keep growing the company. And, but I didn't really know how to go about that. So, so, you know, in terms of this partnership, you know, I was really supported in building out our first MNA strategy, you know, which has been transformative. I think by 2019 we'd made the decision to go public. Yeah. Uh, big decision, huge decision, you know, so obviously listed on the ASX, uh, phenomenal event and a great milestone for the company been running the company now five years in the public environment. And it became quite busy. Very good. And ended up having a few jobs, having to hire. Okay. Or, or, or ask, you know, schoolmates to join. And I actually had this flashback recently that, you know, one of the, the guys, one of my friends, you know, he turned up late and he didn't do a very good job one day and I had to, I had to tell him off, you know, I had, that's what we call a now sort of giving feedback. So to that end, a lot of our founders listening, I feel will really benefit from your thoughts around ensuring that you have a growth mindset and how you manage to leverage your time effectively. Cause there's only certainly certain amount of hours in the day. So firstly, thanks for your kind words. I think this is what I think about scaling. It's very hard. Yeah. And, you know, I think certainly some find it easier than others. You know, I think that part of it, of course, is that you need to accept that. That people are going to make mistakes and, you know, I talked about it in my own experience, right. As I made a heap of mistakes, but you know, Jesus, that's when I got the hard lessons. But ultimately, I think giving them a sense of autonomy, I think what I've seen time and time again is when you give people who are, you know, who are talented and ambitious, you give them space and you give them a sense of autonomy, they feel more connected to the work and they do extraordinary things, things that sometimes you didn't even think were possible. So, you know, for some companies that's okay. Right. Because. You know, they, they may be happy with their size, but I think most companies and founders, they, they want to maximize the opportunity and see how far they can take the company. Well, and especially in the public environment, you, you've got to deliver growth. And, you know, they may be often a lot of people in their company, of course, they're receiving feedback, but who's going to give you feedback as a lonely, a lonely place. Isn't it? So, you know, I think if that's the case, I would say to any founders is you need to try and find someone to support you through that. That will help the company. Yeah, I think it's a difficult transition. I think it takes a lot of self work and of course it takes, you know, reflection because you're really changing behaviors. Have you found now that you've set up the structure of the business that actually you end up finding a lot of. I, what I also found was that to think that I could make decisions better than others was actually a fallacy. There's people who were actually making much better decisions than I, than I could, as we've grown and scaled the company and brought in great talent. From the outside, it's clear you've added some great talent into the business, a well regarded CFO, who I'm sure will be listening, many strong divisional leaders. So we're a software company, right? So we're always looking to automate processes. And so we started with automation and, and. Testing to try to sort of shortlist groups of candidates that fit our criteria. And as we went on that journey, you know, I think we started to think about what does it take for someone to be successful at ReadyTech? People with these attributes, you know, more likely to handle this sort of fast pace of change and almost continual change that comes with the scale up. I just want to add to that, that what's really important to me here is also diversity. And I think what I outlined there is it's not about hiring people who are all the same. And I think then to get into maybe the second part of your question is thinking about the senior people and the leadership team. I think if you get this right, this makes a huge, huge difference in the scale up journey. So, you know, I think my advice is you might not know what really good looks like until you see it. I think as leaders, you know, we, we, we want to, or feel the need to direct. To step away from that and to actually, you know, let them lead without direction. I think it's a leap of faith. It's great. That's another thing that's helped me. Leading on from the talent Marc, obviously one of the key changes in the business in recent years has been a real acceleration step change in the business to win large contracts. The average contract values were probably in the tens of thousands. Right. You know, over time, you know, we've been able to go off to contracts in the millions of dollars, and that's a very significant leap. I think that one thing that we did very early is what was from a sales perspective. You know, we recognize that enterprise sales is different from SME sales. So I think that was a great move. I think the next thing is that we, we started to develop an enterprise sales playbook. Yeah, it's really. A series of steps to move through a process when you're running an enterprise sales opportunity, a lot of this around playbooks goes to scaling, right? You know, you, you're obviously also growing your sales force. It needs to be adapted to different contexts. So we have some customers who are a government and they buy in different ways from, from private organizations. So you can't just take it off the shelf. The playbook is not totally prescriptive. You know, it leaves room for salespeople. To still have a sense of freedom and a bit of autonomy to be creative goes back to one of my management principles. Right. So again, You know, in, in terms of enterprise, we're talking here account based Marceting, right? Persona based, user based Marceting, you know, we've, we've, we've honed and built that playbook out as well. So, you know, I think the, uh, the takeaway here is, is, you know, we've aimed to be best in class, um, and to have a collective approach, a repeatable approach. You know, the new enterprise win. So there'll be a stakeholder from a product and also from the onboarding team, I think that such a important element in these enterprise opportunities to ensuring again, that you've got product fit. And I think it's a, it's very customer centric thing to do as well. But it gets the whole team aligned towards that enterprise opportunity. Sure you did. And I think that what I learned from that is there are many different styles. Of investor in terms of, you know, the way that they, I guess, go about working with management teams, but also I guess the values and, and how they run their organizations. So, you know, I think what I figured out through that process was that, you know, to me, it was just really, really important to find a partner that really understood me and my vision for the business. You know, I think it's a huge thing that many founders grapple with is this, this. This perception of losing control, as you said, and perception is often very different to reality. Now, I think in, in most cases, the smart operators and the great growth partners recognize that they actually want to empower the founder and that they're backing the founder. There are clear pros and cons of being listed. What was your driver to be a listed business? And what have you experienced as both the main pros and cons? I think there's pros and cons to every ownership structure, right? Yeah. What attracted us, I think. There are many benefits in being listed. I think first of all, that we have been an acquisitive company and we intended to do so into the future as well. Right. It's very helpful. Firstly, for us in M& A, we've been able to use script as a, as a way to fund acquisitions. And to connect founders, uh, and management teams to the overall ReadyText, uh, business and, and growth journey also with teams, you know, to be able to, you know, issue share based incentives. I think it's been really, really beneficial. You know, they definitely do. Yeah. You know, we're, you, You tend to be able to be in the media more has pros and cons, of course, because what you do gets magnified, uh, when things are going great, you know, that's fantastic. And it might not always be that way. Uh, but, um, look, as I say, lots of, lots of pros and cons, I think on the other side, of course, everyone knows that there are significant overheads in terms of governance that can take you away from the business. And ultimately most great businesses are built on having a long term vision and making long term bets and not short term investments and bets. So managing that, you know, that balance of the short and long term is a great challenge. But look, I, I made the decision that, you know, I've. Marc, I, I meet a lot of other company CEOs who have done along this journey and a lot of them complain about being listed and I'd made the decision not to do that. It's a great challenge. The other thing, as I said, is that the highs and lows can be a little magnified. What I've tried to work on, and I'm still working on every day, is equanimity, you know, is, is calm under pressure. Grace under pressure, you know, is to, you know, sort of take a deep breath, uh, when things maybe don't go your way, don't necessarily ride all those highs and lows and I try to neutralize that and, uh, try to balance those two things. I think the second one is an understanding that what got you here won't get you there. You know, it's, it's a recognition that to continue to evolve and grow the company, you need to keep reinventing yourself and there are no sacred cows, uh, things. We'll change and they must change. And we live in the world of technology, right? Let me go with podcast because I'm pretty obsessed with podcasts. I try to walk every morning and generally I'll listen to a podcast and the quality of the podcasts these days is incredible. Though we've been talking about scaling today, there's a podcast that's really helped me think through scaling is called Masters of Scale, which actually is by Reid Hoffman who founded LinkedIn and, uh, not just tech companies, but all sorts of companies talks about the challenges and how they have scaled their companies. So Marc, thank you for joining us today and for sharing your insights. It's been really valuable to hear your journey with the business and hear about your wins and your challenges, your non negotiables and interesting to dig into some of your insights. So talent investment in talent is obviously key to your success, building expertise for the future, having a common set of goals.