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This week, on the PRmoment Podcast, I’m interviewing Adrian Talbot, global CFO at Hotwire.
Most PR agency entrepreneurs I speak to reckon the time they hired an experienced financel director was a critical moment for the growth of their business – so I thought it would be interesting to get an experienced PR agency FD on the show to talk.
Adrian has held senior FD posts in various PR firms for the last 15 years, including Hotwire, Instinctif, Bartle Bogle Hegarty and Burson Marsteller.
Here is a summary of what we discussed:
- The most important challenges for a finance director in a consultancy business
- The difficulties of financial forecasting for a PR firm when clients can give you three months’ notice
- The difficulties of managing hard-to-predict revenues against a fixed staff cost
- The difficulty that public relations has in selling an intangible product
- Why a successful FD must involve themselves in the business – not just be the person who pays the bill
- Why the FD needs to continually monitor your revenue and staff costs
- Why Adrian reckons he is in charge of births, marriages and deaths at Hotwire!
- What do PR firms get wrong in their financial management?
- Why PR firms should have weekly revenue and pipeline forecast tools
- How to manage client over-servicing early
- Why PR firms need to recognise buy signals and negotiate more strongly
- The mix of fixed costs and marginal costs that make up a PR firm
- The cost and profit make-up of most PR firms – people, operating expenses and profit
- Why the average UK agency profit margin is 13%, against a target of 20%
- Why the number of freelancers working in PR firms is not dramatically increasing
- Why freelancers need to be experts within a niche, not generalists
- Why the definition of a retainer client has changed
- The challenges of running a PR firm as the company grows
- Why the key reflection points for agency growth challenges tend to be around 3, 10, 30, 100, and 300 people
- Why Hotwire is moving to value-based pricing
- Why clients are not interested in timesheets
- Why timesheets are now an internal business management tool, not an external pricing mechanisms
- Why the revenues of PR firms tend to be cyclical
- How Hotwire has managed to grow its global footprint geographically over the last 10 years
- How Hotwire’s new(ish) CEO Barbara Bates has had a big impact on Hotwire’s growth in the last two years
- The difference of being an FD in a public and private owned business
- Why technology systems are becoming an increasing cost for PR firms
- Why Adrian has set up the Hotwire band – Borderless Thinkers!