Built to Work: Episode 10: Brent Taylor | KC CFO

https://www.youtube.com/watch?v=9dpW0M3Z3fE

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Welcome to Built To Work the podcast that gets its hands dirty dives into the grid and uncovers the heart of what makes the blue-collar world tick I'm Colin your host and I'm sitting down with the people who keep our world running From those tackling the tough jobs no one else dares to do to the HR professionals working overtime to find the labor force we desperately need Whether you're in the trenches or behind the scenes this podcast is for anyone who values hard work determination and stories that build the backbone of our workforce So grab your gloves your coffee or your clipboard It's time to get to work Welcome to another episode of Built To Work Today I am here with my friend associate Brent Taylor Thank you so much for being here Brent Thanks for having me Colin I'm excited to be on the podcast Yeah So Brent and I have known each other for over well definitely over a year now Yeah 

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probably getting close to 2 years about now Yeah Yeah And Brent has a really cool company that he owns It's called KC CFO and we actually utilize your services Yeah So can you please tell everybody what KC CFO is what you guys do that sort of thing Yeah So we're a fractional CFO firm so we work with companies that are growing and and usually bumping into complexities and need a little bit of help kind of on top of probably just their normal accounting 

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sometimes actually we'll get you know called in to help maybe even a startup and we'll come in and just help kind of diagnose and give them some guidance on what they need But our bread and butter is to come into a company that usually has a base layer of accounting maybe they have an accounting manager or a controller maybe they're outsourcing that and to kind of com- come in and compliment and sort of be on top of that and work with the business owners to to drive growth and and do it in a smart way Yeah Yeah Okay No that's awesome So Brent is actually our CFO So you guys are an outsourced CFO fractional- Yep CFO So that means instead of us having to hire 

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you know somebody that costs a whole lot of money- Yep 

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maybe we don't have enough volume of work to justify- Yeah a full-time internal CFO that's when a outsourced or fractional CFO comes into play right Exactly yeah So you know prior to this world I think this outsource world this fractional world existing a lot of companies felt like "Hey I have to get to a certain size-" 

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" and usually a pretty significant size to be able to hire a full-time CFO because-" Yeah " they're expensive You have the benefits the payroll taxes and all that." So this world I think has opened up 

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you know the possibilities for a lot of companies at at at a lot lot smaller levels to get some of that help- 

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that historically weren't used to being able to get that help 

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and a lot of companies are growing You know if you're a $10 million company you probably don't have enough going on that you need a full-time CFO 

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So kind of getting that that part-time f- fractional help is is is is really beneficial Yeah So we have paired a fractional CFO then with an outsourced accounting team Yeah And for me we haven't really missed a beat Like anytime- Yep I need to get a hold of you and I'm like "Hey I have I have a CFO I have a financing question I have an 

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an introduction question a banking question," I just call you Yep And you have the answer So I f- it it's weird to say that you're even like outsourced because it feels like you're part of our team Yeah Right You're on the meetings you're just- Yeah you're part of it You have the high level discussions with us And so that's that's been awesome like to leverage that And you're right like I reach out to you a couple times a week Yeah I don't need a full-time CFO over here So it makes sense Yeah It really does One of the goals 

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that you have for yourself is that you want to help these companies grow right 

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Small mid-sized companies grow to a point And what is the ultimate goal of that growth when you're helping them The I I have 2 goals for a company One goal as we grow into a point where maybe they get acquired 

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It's a big success story for us And then ultimately the the more 

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typical goal is that we almost grow ourself out of a job to where the company's gotten to a certain point where they need a full-time CFO 

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And it that's a success story for us and and one that 

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we're excited to sort of you know have to exit a company because of that Yeah And in that situation we'll then kind of help them identify 

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who that replacement will be to to be full-time and kind of help with this very smooth transition so Yeah Transition over to the role that you had been doing to them Yep Yeah Absolutely I I love it that your goal is to work yourself out of a job Yep Right And we're seeing that a little bit right now with like 

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with Doge right Elon wants to work himself out of his- Yeah his Doge job We'll see how that goes but that's been that's been Okay so that's awesome 

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how did you get into the fractional CFO world That's a great question So I started my career I was at a Big 4 accounting firm and then I was at a large health system for 

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quite a few years and I married a small business owner 

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And you know it's when you're in a giant company a lot of the problems you know you don't really actually like there's a department for that problem Yeah Right It's like "Oh this comes in this is a problem that goes over there." Well when I got to kind of see my wife's business I'm like "All these different departments don't exist It's usually the business owner that has to figure all these things out." And so I helped her 

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actually buy her business finance it set up the infrastructure and just kind of saw that world and just I'm like "Wow this is" It it was kind of fun it was impactful 

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And I'm like "I'm helping guide you know a company." And and it was a small very small business but- Yeah just I had little sparks going off and I was like "Whatever that was I want to do some more of that." Okay 

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this was about six and a half years ago which is kind of crazy to think about 

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so sparks kind of start flying and Well actually that was probably like 8 years I needed about a year and a half to convince my wife to let me you know quit my good paying job Start your own thing yeah 

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but when I did you know it's funny at the time the w- term fractional wasn't really a big term at that point Or even outsourced.So I was calling myself basically you know I'm I'm consulting Yeah You know And so I had all these different terms and in the past I'd say 2 to 3 years that term fractional has definitely become a much more understood and- Yeah and used term and more people are getting into it 

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but it's been an absolute blast getting to work with companies and business owners that are that are growing that are hiring people that are adding locations and that are maybe bringing on new banking partners So it's it's been a blast Yeah It's been huge One of the things I love is is 

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being able to leverage your Rolodex Yeah Right For those of you who don't know what a Rolodex is it's your contact list- 

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in the old days But being able to leverage that and one of the first things that we did when we acquired this company- Yeah Even before we acquired the company we started working with you Yep And we said "Hey we we need a fractional CFO." "We want some guidance as we go through this purchase process for the business." So we started having conversations with you And then even before the business closed or right after it did we started interviewing new banks Yep Because we bought 

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a company that's different than where we are so we wanted a local banking relationship And just being able to leverage your contacts has been really huge and you know that's part of what a CFO does- Yeah is help help fix those things or make them run smoother Yeah So that's been great Yeah And that's one thing you know there are so many things that have happened that I didn't anticipate but when you get to work with a lot of different companies you're working with a lot of different bankers you're working a lot with a lot of different business coaches you're working with other fractional firms that maybe offer HR or marketing so you get to kind of know this great I guess we'll call it Rolodex of of people and you see who worked well with clients and who served them well and- 

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and you know you get into a new client new company you see some of the problems or issues or needs and you're like "Hey I've we've kind of done this over there." So you can kind of bring that in and you don't have to recreate the wheel a lot of times Yeah What I found interesting is you bring those people to the table right We say "We're gonna go We don't wanna have our own an accounting person." Yeah "We wanna we wanna outsource because then we're gonna have scale that we can leverage-" Yeah " as we grow." And if one person quits there's somebody to plug right in we don't have to go through that hiring process 

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it's been funny how we eventually connected but we have 2 places in our life outside of this where we overlap Right And the first one was my mother-in-law used to work for the accounting firm she was a junior partner Yep At at a firm that we ended up bringing on Yeah And you're like "Hey you should really talk to these guys." I was like "Okay." I've heard of them I've worked with them I've heard of them yeah I know them I've been to their office before 

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and then the second one is your wife's company Yeah Right So she's a dentist Yeah she is And 

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a guy that I go to church with is now her partner- Yeah at the dentist and so I went down there and I saw him He's my buddy I had him clean my teeth and then I'm talking to Adam on the way back and he said "Oh yeah Was it down there?" I was like "Yeah it was." He goes "That's Brent's wife's place." And I was like "No way." So somehow our lives had managed to connect and like not hit until we started this Well yeah 'cause now we can talk about "How is Premier doing?" And I can also say "Have you been flossing?" Yeah no- So it's perfect Yeah And I have been so Last time they had to drill a little bit and I don't want that anymore But it is kind of funny what a small world it is- 

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when you get out there and you have all these different connections and I mean for Kansas City that's one unique thing I think Yeah Is is 

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it is a smaller community 

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smaller than you probably think Yeah I've I've always I've always said Kansas City is a very small city Yeah Like a very small big city 'Cause I you always seem to run into people- Yeah you know and 

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just cross paths and the networks especially when you get into some of the professional realms those networks just cross a lot They absolutely do Yeah Yeah Yeah So we obviously espouse the benefits of- 

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outsourcing some of our roles and and you do too you believe in it because that's- I do That's what you do and it's great 

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so can you share with me and you don't have to disclose any company's names or anything like that But give us a story 

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of a company that you were able to walk into either make a big change or help them kind of achieve the goal and how that might not have been possible without leveraging like your services Yeah absolutely So I have a few that come to mind but 

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I got introduced to a company at 1 point that had brought in a new COO 

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this company had been around for about 25 years and it had had a really good history a lot of years of growth and profits 

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and just had some stumbles and they had probably 3 years of them to where they all of a sudden they weren't growing they weren't profitable they took on some debt that they shouldn't have some of these I'd say merchant working capital- 

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super high interest rate- Yes loans that 

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unfortunately some some companies fall into the trap of taking out So I got pulled into there 

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with this this new COO just said "Hey take a look at things I just I'm just curious to brainstorm with you to see what you think and and if you think there's a path out of this." 

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And you know we got in there and there was definitely a path I mean the company had a really good product and some services So you know in- interestingly and this is I see this a lot with companies' financials we got in and the books were a complete mess 

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So it was actually hard to understand where had the company been Like like when did they start you know when did kind of the slip really start happening and so one of the things I did is I introduced the company to an outsourced 

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accounting services firm Okay And they came in they rolled up their sleeves with us and they kind of helped make sense of the financials They sort of they re- rebuilt processes And one thing that was unique I think about that instead of just trying to hire somebody is you know they're working with a lot of different companies too They have quite a few people on their team so they were able to quickly come in diagnose restructure clean up and and kind of get the financials in a good spot really quick Okay So then we were able to take that and kind of really ac- actually start making some good decisions and you know this company had a lot of different locations 

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They had never really had an income statement to figure out how's each location doing Are they making money Are they not And once we kind of got the financials fixed what we found out is I mean they had 3 locations that were single-handedly you know creating a a giant loss for the company So that helped give us basically the ammunition to go close those 

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And kind of you know just sort of just get back to ground 0 so they could start taking off again and probably within about 2 years they were back to growing they were profitable and and doing some cool things So that was a fun story But you know again to be able to bring in that accou- outsourced partner for accounting- 

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that could quickly jump in and get going I mean that was that was critical Yeah And by utilizing your services they were able to save effectively a lot of money as well- Yep over hiring a full-time CFO Right Absolutely Yeah I mean I I think if you if you look back you know my team we were able to to help save their company for probably a fraction of what it would've cost- 

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if they would've hired somebody full-time Yeah Yeah That's great 

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one of the things that I love about this and 

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this is something you can speak to as well is letting people or companies focus on their core competencies Yeah Right Especially small business owners Yeah Even even big businesses right Because we work with a number of really large businesses and and you know we have a specialty and we're we're good at our specialty Yep And you have a specialty and you're good at that Have you seen benefits from or just worked with working with small business owners like "Hey maybe this small business owner doesn't understand this." Yeah Like that's how 

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you focus on that right Yep Yeah So with us I know you said "Hey I've got I've got the finances." Right "You guys focus on sales and operations." Yep Right Is that kind of the way you typically work with the other small businesses that you work with It it is and and one of the things that I just consistently see in the small business small to mid-sized business world is the business owner always wears too many hats 

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Right And that's pretty natural because it's usually that company is that person's baby they live and breathe it They think about it throughout the night So you get in there and you get to know the owner and it's like "Oh you're nothing can happen in this company without you." Yeah And hopefully you never get hit by a bus because- this company would fail to exist and all the employees would be in a tough spot So just I think taking off and and handing out the different hats and the different responsibilities and the different roles when I see a business owner do that that usually means that that company's gonna grow and good things are gonna happen right So what was really fun to work with you and Adam on is you guys from the get-go and I know you have some entrepreneurial background- Yeah and you guys have learned some lessons from day one you were like "Hey we're gonna try to stay in our lane and do what we each do best." 

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"We want you to come in we want you to help figure out who's gonna kinda handle the accounting." And you guys have done that both on in the HR payroll space too I mean you guys have done that in a lot of different areas 

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And most companies it takes them it takes them a while to get to that point Yeah So you guys out of the gate with Premier it was super cool 'cause it's like "Let's put the right infrastructure in place let's put the right partners where they need to be and let's get this company prepared to serve our clients well and and to be able to grow." That that's true And we learned that the hard way right I can go back and say okay with our first first company property management company man we we screwed up every single internal process- Yeah that we could and learned all those lessons Yep Because Adam and I were trying to do it all Yeah We weren't now we kind of had our own lanes but too like so much of that operational stuff which is what a lot of people outsource is their operational stuff Yep They'll typically outsource their sales or you know BD 

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more their core competency It's that operational stuff so I mean man Adam was having to fight through payroll Yeah You're having to fight through HR and then he was having to handle all the accounting and we had one other person that was kind of handling that as well And just realizing it's like there's so many things and we weren't experts in them Yep So they were getting done but maybe not correctly or g- goddamn well Yep And even to the point where it's like okay the other person that's helping generate invoices we were missing a bunch of invoices Yeah Right You c- you can't afford to do that for long before you don't have a company anymore And so yeah allowing the professionals to come in And then you're finding yourselves all of a sudden like "We just spent our whole day trying to do invoicing." Yeah When surely you guys could've probably spent your time in a different way that would've been more beneficial and impactful for the company Oh yeah There were so so many more things I I felt bad for Adam He had some really long weeks There was a long time- Yeah where he was he was shouldering all of that stuff Yeah that's good for Adam though Yeah it was good from there We were we started out we were running payroll through QuickBooks Which is a fine system Yep But-I had started it and I didn't know what I was doing I didn't know about state tax ID numbers or filings and and there there was a lot to to unscrew You're a business owner you're supposed to know everything though right Yep Yep And and once we learned that wasn't the case and we brought in the professionals to help- 

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we obviously didn't know you back then but property management was our old business it's a very niche accounting system because it's integrated into the property management software Yeah And there's a bunch of different ones so it's not like "Oh QuickBooks," it's like "No Software A and Software B and C and D and E." They're all different in the way they operate- Yeah And all their reports are different so we ended up bringing in a real estate professional accounting firm and let them handle it Yep And that was kind of at the point where we were like "Whoa This this is the way to do this." "Hey I just got a bunch of my time back." "I've got somebody that's that knows what they're doing they do this for a lot of different companies." Yeah Yeah absolutely Brought in experts they did expert things and we could focus on our core competency Yeah 

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so as you look forward to the future I think that you know fractional CFOing is going to continue to be a thing I think there's some people out there also looking maybe at like fractional COOs at points as well Yep 

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are you guys looking to grow your company and your service offerings Yeah we are I mean we're we have a small team there's there's 3 of us but you know we're small and nimble Yeah And we're we're picky on who we work with just because we want to grow but we're gonna have pretty smart growth 

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and it's you know we want to work with the companies like Premier that are gonna be very smart about it and and that want to grow and want to do good things for their company and their people 

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so we're gonna keep growing 

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and you know what's interesting is i- in the fractional world which by the way I love the fractional CFOing term I might actually coin that CFOing Nice You can have it Yeah that's good But I'm seeing it in like the HR world there's fractional HR now Okay 

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the frac- there's fractional COOs Starting to see fractional CMOs Okay So this I think that the the potential for companies out there to bring in partners and experts in all these different areas without having to hire a full-time person- 

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is gonna be really interesting and they're probably gonna be able to bring these people on obviously for cheaper than it would've been to hire them full time So I think you're gonna really see in the coming years this is a model that just becomes very normal 

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Yeah I I and it's maybe a little bit the professionalization if you will of the gig economy Yeah Right It is to an extent I'm getting you're gonna hate this You're like the Uber for CFOs right No I need an app Yeah you need an app 

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no but i- it's it's kind of leveraging that that people can wrap their mind around that now And and without the advancements in s- cell phones and technology- Yeah And just what we've gotten used to especially through COVID Yeah As those apps really got big i- people might not be able to understand that concept of- Yeah "I'm just gonna rent this person's time." Instead of "Okay I need to bring on this full employee with all of the associated cost and burden," et cetera like Yeah And one of the really neat things happening in accounting right now is there's a shortage of accountants Oh really 

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and even the pipeline coming from the colleges there's just not as many I I guess I guess accounting's not all that cool but 

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What I don't I don't believe that But 

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It's the coolest So I do think this fractional outsides worl- outsi- outsource world for accounting and for CFOs 

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It's only gonna grow and I think that shortage is also gonna be part of the reason why it's growing Yeah Yeah Yeah absolutely 

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sometimes I even see when so you know sometimes like a fractional CFO That's great it does end up saving you money Yep 

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but sometimes when people outsource they'll actually outsource to 

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a service or someone Yeah That's actually maybe a little bit more expensive Yep Than bringing in your own internal Yep But you're getting to leverage their expertise Yeah And their expertise makes them more productive than your own internal person or allows you to focus on something else where it's like "Okay." Yeah "That is more expensive but it's worth it." Yeah I mean it's more you're looking at outcomes 

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And it's not so much like "How much time did you spend?" It's like "I'm bringing in expertise and outcomes that you wouldn't have gotten potentially otherwise." Yeah So I think that's that's a mind shift that I think a lot of companies are are making and understanding like sometimes it's worth spending that money for what you're getting 

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And absolutely the value that you're getting in return Yeah Yeah sure 

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so for people to say "Hey," or you to say "It's time to hire a full-time person-" Yeah is that a Do you see like a revenue bracket that that fits into- Yeah or is it like a workload Where where do you see that happen that somebody then hires their own full-time CFO and replaces you That's it So I look at this 2 different ways 1 I look at it if I look at kinda the range of companies w- we've gotten to work with over the years revenue-wise they're probably anywhere from $2 million to $30 million a year in annual revenue Okay 

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there's some some nuances within that 

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and then probably from like just a a employee perspective probably between like that 10 to 100 Okay So in our experience once companies start hitting around 100 they're probably starting to look at potentially a full-time 

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CFO The other thing that we've learned over the years is the the thing a company probably needs sometimes first before a full-time CFO is a full-time controller Okay Just because of the level of activity and transactions and maybe there's multiple accountants just to kind of oversee that and to ensure that you have just good accounting processes and and timely financials So sometimes a company might bring in a full-time controller first- Okay and keep that fractional CFO for a little while longer But somewhere around that 100 employee mark is when I feel like you know that full-time type role starts to make sense 100 employees $30 million in revenue- Yeah somewhere in there Yeah And again different by industry sometimes but that's kind of what we've seen so yeah Well that's great Well I can't wait to 

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kick you out of your job or replace you I guess 

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Yeah it would be a success story It's a success story for sure 

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no All right Well Brent I really appreciate your time Thank you- Yeah for your knowledge Thank you for all you do for us Yup You're a rock star If you need a fractional CFO hit this guy up and he will take care of you guys Awesome Thanks for having me This was a great conversation Appreciate it