Episode #3 You Can’t Expect Different Results Doing The Same Thing You Have Always Done
If you're always doing the same things that you've always done, why do you expect the results to be different? In this episode, we interview Richard Francis, the CEO of Spotlight Reporting, a chartered accountant, and a trusted advisor with over twenty years of advisory experience. During this discussion, Richard shares how he has used his belief system to give him the confidence to take risks and never stop learning. He also lets us in on his secret passion outside of work as well!
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You Can’t Expect Different Results Doing The Same Thing You Have Always Done
Take Action, Rather Than Resist
My guest is Richard Francis, the CEO of Spotlight Reporting. He is a chartered accountant and a trusted advisor with over twenty years of advisory experience. He has been there and done that like the customers he serves as a director of his boutique professional services practice. He saw a need to improve analysis and forecasting for his own clients, which led him to start Spotlight Reporting. In our discussion, Richard shares how he has used his belief system to give him confidence and take risks and never stop learning. He lets us in on his secret passion outside of work as well.
I'm very excited to have the CEO of Spotlight Reporting, Richard Francis, on with us. Richard, you want to give a little background on yourself before we get started?
Thanks for having me. I'm thrilled to be here. It’s cool to be here with a former Xero colleague from way back when. My brief bio is I’ve been the CEO of Spotlight Reporting, which Xero’s number one reporting and forecasting partner. We also work closely with Intuit and some other partners to bring forecasting, advanced reporting consolidation and other goodness to the advisory accounting in the CFO sector. Prior to that, I was an advisor to businesses myself. I've come from the front lines, worked with lots of core entrepreneurs. I was there way back in the start with Rod Drury and Hamish when they launched Xero. It was an exciting decade growing a global company, which now has offices in New Zealand, Australia, the UK, the US and we're about to open up shop in Singapore and Canada as well.
That's why I'm so excited to have you on. The purpose of this show is to try to get into those habits and patterns that show up for us that we bring, whether it's from childhood or what people say to us over time. It's hard for us to start breaking apart what does our beliefs versus what we were told to believe. With the risks that you've taken in your career and have found a lot of success, I'm sure along the way you've had to do a lot of self-reflection and figure out where you need to pivot or be honest with yourself about making changes to move forward. I'd love to hear a little bit about your path and where this might have occurred for you.
A lot of these revelations happen at 3:00 AM or 4:00 AM. It's interesting to reflect as you do because I started Spotlight when I was 40, which is later than a lot of startup people do. Before that, I'd started my business consultancy practice way back. I had worked for a large firm running the consulting side, which is why the advisory and helping people and doing more with my background was important. Going way back, my father was a chartered accountant and he worked hard. This was the ‘70s. I was growing up ‘80s. We didn't see a lot of him because he was working hard and there were high mortgage rates in those days, the oil crisis and all those kinds of things that we can vaguely remember as children. I said to myself there, “I'm not going to do that. I don't want to be an accountant,” because it had a little bit of that boring stigma. I was surprised coming out of university that my first job was in an accounting firm. I did that as a degree as well as a commerce degree. I majored in classical studies and history and that's still my passion. I'd still rather be poking around ruins in Rome or somewhere.
When did you start having an interest in that?
Right from the start, I've always been an avid reader and I'm still old school. I still read books. I still like the tangible feeling of that. I have a bit of a library and I love having the downtime. I don't read business books. I used to do back in the day, but I'm sure like you, to a certain extent, when you're out there doing it and living it, you don't need to necessarily to be reading too much of those things anymore. They bring some new insight. I’ve always been an avid reader and I have always been interested by the past and how that can inform the future. I'm sure I have all my leadership team with quotes like, “If you're always doing the same things that you've always done, why do you expect the results to be different?” I think from that background of intellectual curiosity. It's something I want to keep because that intellectual curiosity led me to pivot into interesting areas of the accounting industry when I found myself accidentally in there.
Before you go, how did you find yourself accidentally in accounting? Why didn't you go that path?
I hit that moment that we all do when we're doing stuff we love, but you can't see how it can turn into a job. I didn't want to be a classical studies lecturer at a university or an archeologist on $10 an hour digging up holes in the third world or anything. Although part of me quite liked that idea, like a lot of humans, I wanted a decent salary and probably a more stable career. When I came out, it was early ‘90s. There had been a little bit of an economic slump globally. I think pretty much all of us went out and about and met with the law firms, the accounting firms and the usual suspects who always hire lots of people. As I say, the next thing I knew I'd been offered a job with good money and I was sitting there blinking in the surprise and horror of a pile of paper on my desk on day one and accounting partners demanding I get productive and do stuff. Interestingly, the lady who started on the same day as me never came back. She was either the genius or I was. I'm not sure which one. I ended up there accidentally. I thought, “I need to do my time. I need to learn accounting and all those things.”
I decided I wanted to do useful stuff. I know that sounds glib, but I sat there thinking, “Why are we doing all this historic paper-based stuff that the clients don't care about?” They want to end the meeting fast so that the bill doesn't get too large. There are six-minute units. We have all this insight. We have all this data. Way back in the ‘90s, I was thinking, “How do we use data? How do we provide recommendations and advice that resonate with the clients?” It seemed obvious to me and it still annoys me now when we're still fighting with accountants in hand to hand combat to get them seeing that they can do more and be more.
What do you think stops it?
It’s the fear of the unknown. It's very easy in our profession for there to be topics or almost trigger words for people. Advisories become one and software was one, as we both know from the early days of Xero, all of them are saying, “Yes, but is it safe? We're going to stay on desktop. We don't believe in it.” How many people say that now? Pretty much no one. I remember the CEO of a major software company, who will remain nameless, being on stage at a conference telling us that it was a fad and that desktop was here to stay forever. Everyone was agreeing with him apart from a handful of us at the back recoiling in horror at the Jurassic Park attitudes. On the advisory front, I’ve never been one who say compliance is dead. It's not we still have to do that part of our job because I’ve been so driven by doing things differently and trying to give my clients the best outcomes for their lives from a holistic view. I don't understand that when it's pull back and saying no when you're going to do the tax returns. I think there's fear.
When is it for you when you've experienced that yourself and it's gotten in your way?
I'm quite confident. I don't think I ever had that fear. You asked about the back story. I was a shy kid. I look back now and I can't believe it because frankly I'd be happy to meet anyone and talk about anything these days. As a kid, I used to hang off my mother's leg and peer around other people. I've heard that quite a lot about entrepreneurs, that often they were a little bit shy. In the process of coming out, so to speak, they've made up for that by getting out there and taking risks. I never felt any fear in the accounting industry. It was, from day one, “How do I turn?” I've ended up in this industry. I'm not a lawyer. I don't want to do classical studies, lecturing or whatever. I've got to make the most of this. Right from those early days, I wanted to do consulting and useful stuff, but then to have the likes of Xero come along, Rod Drury and Hamish Edwards shaking things up and suddenly accounting’s beautiful. What’s with that?
Suddenly you're at Xero cons where it's the most exciting gig in town. We look back and we take it for granted now, but in those days it was quite revolutionary. I think the likes of Xero and now Intuit with QBC and other things, they’ve grasped it and tried to empower accountants and take away that fear without wanting to resort to clichés. In general, the industry is still conservative. We don't like to jump too far. Because I'm someone who wants to leap and have a leap of faith, sometimes I find that frustrating. I've got a team who believe in the mission as well, so we're dragging some accountants. There are others that are ahead of the curve.
As far as you being shy, what did you do to push past being shy and why did you do it?
I'm not quite sure what the moment was. I didn't have a Road to Damascus moment. I did well at school and all that stuff, had friends and all those things. I look back and think, I wasn't empowered. I had conservative parents. I had an accountant dad and my mum was very smart but conservative like an Anglo-Saxon Protestant Presbyterian. We weren't taught to put ourselves out there or try and be the best. In some ways, it's a Kiwi attitude, probably much less prevalent in the United States where you guys are pretty much out there all the time.
It depends on your family.
Whether it's true or not, I think what we've seen as a little bit reticent down here. I had all that baggage and then I got to my twenties, I thought, “Why not get out there, do some stuff and shake things up?” I live in the UK with my wife, Julie. We were in London for a few years. We traveled a lot and we had different experiences. When we came back, we started own practice and didn't even advertise the fact that we were accountants. We were advisors. We started doing some good work strategies and mentoring with tech companies in New Zealand actually. We got to know Xero and we did accounting on the side. That was the start of it. When Xero came, I thought, “I can either be a Xero accountant or because Xero only does accounting and QuickBooks only does accounting, what about all that cool stuff with visuals, forecasting, consolidation and multicurrency? All of that stuff we now do franchise reporting, no one's doing that.” I was 40, as I say, and we carved out quite a solid and stable position in life. We had a couple of kids and a nice house. We risked it all. We mortgaged everything. We raised money. We lived off a cliff. I was lucky that my wife was 110% behind this. She’s now the CFO but that could have been that horrible.
That was part of the deal that she got to manage the money.
There were lots of deep and meaningful conversations.
What made you believe that it would work out?
I'd been in the advising business for so many years. I knew how it worked. I saw the gap, I believe, in Xero, which was important. The beauty of Xero doing what they've done is they woke up the giant. Now you have the likes of Intuit doing a lot of cool stuff in the cloud space and others trying to catch up. It built its momentum. We showed up at everything. I did 55 international flights in one year. I was showing up at every Xero event I could with my brochures. I managed to wangle myself on stage a few times. You do the hard parts. I believe that if you work hard and work smart, you'll succeed most of the time, though it's proven.
Were there been times in the business where you've questioned it at all, where you're like, “Did we make the right decisions? Did we go in the wrong direction?”
I'm not one of these, “At 5:00 AM, I go running and do yoga,” CEOs that you read about on media but I do wake up early and I clear all my emails overnight because I’ve got a UK and US team. I have my coffee and my calm time and I sit there and not the second guess, but think through everything that we're doing strategically. Strategy is a daily concern of mine. Should we open that Canadian office before we open the Singapore office? What am I hearing from the guys on the ground? Is it the right time? Is it the right thing? Should we throw that money and resource at a product skew? They tend to be more strategic and technical thoughts and internal dialogues than anything that I run things past my leadership team. It’s not an existential review of where I’ve come. I’m here now. I've got 52 staff, 52 families that rely on us doing the right things. I've got shareholders, who of course, absolutely expect me to do the right things, partnerships all around the world. It's too late to back out now. I've got to make it work.
Have you found a way to bring your historical love or going on vacations and look going to ruins? How do you still incorporate that?
Absolutely. I normally have about ten books on the go at once to many people's amusement. My bedside table has this mess of stacks. If I took a photo of them for you, there wouldn't be a business book. There might be one business book that someone's given me, but they will all be about the Roman Empire or World War II or the New Zealand history. I'm reading something about the early pioneers in the United States who created the great nation that it is now. I love all of that. If I could be paid to do that, I would. My second biggest love is empowering this industry and changing the face of it alongside other great pioneers like Rod Drury, Brad Smith and all of that. We're small, so we can't have quite the impact of those guys at the top of the food chain. One of our mantras here at Spotlight is to create a ripple disproportionate to our size, like the old pebble tossed into the lake. We try to do that.
I think there are a couple of big points that I’ve heard that you've brought up and then let me know if there's anything I missed. One is that you're never too old to start something new. At 40 years old, you took the risk that many people wouldn't take it that age. A lot of times those are the things you hear. It’s like, “I'm too old for that. I'm not going to change at this point,” or so forth. That constant evolution is what keeps us young in our hearts and minds and soul to keep us learning. The other thing that I heard, you're very fortunate to be born with a lot of confidence because not everybody is. I have always thought about confidence as one of those things where either comes naturally to you or you have to work on it. It's like your right arm.
When you find it within yourself, a lot of times it's getting inspired by other people and not being jealous of other people. That's what I heard you say, whether it was from going from being shy to not being shy. You opened your eyes to look at other people and like, “I want to experience that,” instead of being jealous that other people are experiencing it and you're not or looking at other entrepreneurs and CEOs and saying, “They thought about this differently. That inspires me to do it differently and not looking at myself like, ‘I'm not worthy.’” All those things are important when we're trying to break past where we are and move to that next phase.
There are a couple of things there. I don’t like to die wondering. I do think of things like, “What do you want to have as your legacy? What do you want to have on your tombstone?” I don't know whether it's ego or what, but I find that most driven people and this may resonate with you, you do want to leave behind or create something bigger than yourself. I ultimately want to merge back into the shadows a little bit like someone like Rod. He has now stepped back as CEO and he's doing product stuff and probably a lot of surfing. I still aspire to step back and to let Spotlight do its thing at some point. I think there's a drive where you want to lead a life that's a little bit less ordinary. Being 40 years old, running a good advisory practice and all of that, I’ve left my desk to solve world peace or cure cancer. I thought, “I want to create a great rapport in this industry and be part of this wave and not a spectator on the sidelines,” as some people can be. As you say, sometimes they're sniping from the sidelines because they don't like seeing people that have leaped off on wings of faith.
Coming back to how you’re never too old to try new tricks and strike in a new direction, as soon as you mentioned that, Amy, I thought of how I spent my afternoon on the annual general meeting of an alumni association associated with the school my daughter goes to. I'm the chair of a good female school here in Wellington. I’m a bit of an ardent feminist, which might surprise you. It's amazing when you have a daughter who you want to have empowered and to become a leader. The all-female school allows females to flourish and be all they can be. I'm driven by that, which is why I was involved with the school to be the chair. At this alumni meeting, a 95-year-old old girl came along and it was empowering for me to see someone. I sat down and spoke with her at length. She's given 80 years of service, not only to the school but to her community. I thought at 95, to want to come to an annual general meeting to talk about the school and to hear from me and the principal about what our plans for the future, I was blown away by that.
It was bigger than that.
I've also been inspired by my father and my mother who are both still with us. They’re in their 80s now, but they've also given a lifetime of service to the community and are still active on various bodies and charities and things like that. I think if people at that stage of life are still contributing so much to other people and industries and organizations, why can't we do whatever we want to do and look through it? Look through the lens of a lifetime, not that 40 is too late or 60 is too late or 95 is too late.
You're alive. I want you to pick one category and then I'm going to ask you four questions and you say the first thing that comes to your head. The choices of your categories are either family, friends or coworkers. That's one category. The second category is money, third is spiritual and the fourth is health. Which one would you like?
Let's go with family, friends and team.
What do you want that you don’t have?
I want more time. I try and be an active parent with my son and daughter. We chose our HQ at Spotlight equidistant between the two schools of our kids which has been cool. I try and get actively involved, but I'm loving the dream of being an entrepreneur and the travel and all of that stuff to an extent, but I would trade all of that for more time.
What about something that you do have that you do want with your family, friends or coworkers?
I know everyone says this, but my team, I think I’ve got a strong, front bench of leaders in my business as any partner or any small software company is. I look at Julie, my wife, who's key to the business. I got Kristin Harris who used to be a GM at Deputy. David who worked for Xero and receipt Bank, Matt and Nick. There are lots of others who have come through right from being accountants. Nik George, who's one of our product managers, was an accountant with us at our accounting practice and now he's a respected product manager in the software as a service ecosystem. We've all got each other's backs and we can have those conversations that we need to have to keep scaling. I don't think it's as common as people make out. A lot of people say that, but there are a lot of organizations where you can't trust the person that sits next to you.
What about things that you don't have that you don't want with your family, friends or coworkers?
That's a hard one. This will sound a bit strange. I don't have a lot of stress or existential moments of, “What are we doing? I need to do something else. I don't want that.” I'm not projecting that as a CEO. There's a healthy level of momentum and direction you need to have. My family is very understanding of when I can be there and when I can't be there and all of that. We've got the balance right and therefore I'm not going to do things to bring that out of kilter. I think part of that resonates with you. Because when you have trebled and built things and you've learned a lot by observation and doing and this is the difference between selling a business at 40 and twenty. I've observed so many people do so many things right and wrong that I’ve absorbed a lot of the wrongs and been obsessed with not doing those.
I've been reading the book, The War of Art and that was one of the things I read about that a more experienced entrepreneur is patient.
We have new material coming out now where a lot of people are saying that these slightly older entrepreneurs aren't doing too badly after all. You look at a lot of the successful companies and they've got someone who maybe started in their 30s or 40s. I think it's debunking the method a little bit of these twenty-year-olds in the garage in Silicon Valley. There are obvious examples of that. When our VC came on in our series A, so we haven't done a series B, one of the first things he said to me only half-jokingly was, “When are you moving to Silicon Valley?” Why would a 40-year-old want to go and live in a garage in Silicon Valley? There's a little bit of that received wisdom always from Australasia that you have to move to America to make it. There are certainly businesses where it's true. Luckily I had the likes of Rod and the guys back in the day and all that who had done a lot. There was another one who've done a lot from New Zealand or Australia without necessarily moving their entire business to the United States.
It was so much before this globalization now that's occurred where you can be anywhere as you make these shifts.
It struck me that the ultimate irony of being a cloud business. Telling people that you can do advisory from anywhere, but then having to physically move to Palo Alto, I'm still in Wellington.
To end our conversation, is there anything that you want people to take away to know about you or Spotlight Reporting or anything that you want people to look into?
I think if you're in the accounting advisory or CFO space and you probably are if you're reading this, think about the great work you can do for your clients and the things that maybe are a little bit outside of your comfort zone and give them a go. At Spotlight Reporting and I know many other partners and in software giants like Xero and Intuit and Sage, MYOB. There's lots of resources, lots of education, lots of help. There are lots of people like yourself. Providing a lot of advice from your years in the frontline to make it a much less fraught transition than it was, from doing historic backward-looking compliance to doing that. We need to check. Being future-focused and being a catalyst for change for your clients and they perform better as a trusted advisor. Check out Spotlight Reporting as a tool to enable that. You're never too old to challenge what you're doing and whether you can be more, do more and leave a lasting legacy for your clients and for your business.
Thank you so much for having this conversation. It's been very interesting.
I hope you enjoyed this conversation with Richard. Now, it's time for Mindful Moments. One of the things that I want to pause and step back and reflect on is Richard's term, intellectual curiosity, where he reflected on, “If you are always doing the same thing, why would you expect the results to be different?” The thing about being human is we have the opportunity to repeat patterns and routines or we have this opportunity to be curious. To study ourselves, to study our behaviors, how we think, how we feel, the energy that we put out into the world. When we step back as an observer rather than being right at the moment, it can be interesting to think about why did I react a certain way or why am I only comfortable doing things one way instead of opening myself up for new ideas?
The thing is with our brain, to keep it healthy and keep ourselves creative and innovative and bring that into work, it's important to find these outlets to keep training our brain. Richard referred to that he reads books that are possibly off-topic of the business work that he's doing, but it's making him think a little bit different. How can he take that back into his work life where it spurred an idea, it spurred that curiosity? When you step back and maybe take from it what made you curious or what made you think about what are some actions that you could take in your own life to create this positive effect? Don't fall back into your everyday routine. Think about one thing that you could do differently as you go.
About Richard Francis
CA, ex GM of Workpapers for Xero, and a trusted advisor with 20+ years of advisory experience. As the director of a ‘boutique’ professional practice, Richard saw a need to improve analysis and forecasting for his clients.
This led to him starting Spotlight Reporting, which is now the #1 Reporting and Forecasting app in the Xero ecosystem.