Scaling and Systematization

Today, our guest is Ryan Lazanis. Ryan is founder of Future Firm. Future Firm provides firms with education to help systematize and scale their firms. He also has Future Firm Accelerate, which is an online coaching program and includes a combination of online courses and online coaching. Ryan, welcome to The Unique CPA.

Randy, thank you very much for having me—greatly appreciate it.

Yeah, that’s no problem. Before we get into it here, and I think you and I talked about it— we didn’t actually talk about it ahead of time. I’m just trying to remember how we got connected, and I think it just came to me. I think I reached out to you, and thanked you, because you put The Unique CPA on your list of top podcasts—wasn’t that it? Didn’t you do that?

That’s it. I think that’s how we got connected. I think there was a post that Future Firm put out earlier in the year, listing the top counting podcasts to check out, and you’re on it.

Yep. Alright. I was fishing for that to let somebody know that we’ve been on a top list. So thank you. I appreciate that.

Yeah, it’s out there, and the proof is in the pudding.

There you go! It’s online, it’s real. You cannot deny it. We are on a list now. So that’s awesome. 

Alright, so today, I’m really excited about having this discussion, and what we’re going to talk about is basically creating a scalable accounting firm, and the business model to do that. And I’m excited to do that because I think a lot of times, one, just the whole looking at the CPA firm and accounting firm as a business, I think often, isn’t even happening. I think some CPA firms don’t even really realize they have a business. They think they’re just there to help clients, which I know doesn’t sound right—to you, maybe it does, because you’re nodding yes. 

So I’m really excited to get into this today. Because I’ve listened to a lot of your podcasts, and your newsletter, which I’ll ask you about, you do a great job. But before we get into that, before we pick your brain and get all your knowledge, why don’t you give us a little background on yourself and where you came from, and how Future Firm started?

For sure. So I’m a CPA born and raised in Montreal, Canada. I started one of the earlier online accounting firms in North America back in 2013—it was one of the first fully digital firms, really focused on automation, serving small businesses in a more pain-free manner. We all know that our clients hate their accountants. So I just really wanted to make it pain-free and easy for them.

Started on my own from scratch—had no clue what I was doing, first time business owner, made all the mistakes possible, but ended up putting together a business model that operated more systematically, in a more scalable fashion than the traditional firm. And that caught the attention of a lot of outside parties, and was acquired five years after I started it by a large European corporate services firm. 

And in 2018, I started Future Firm to help other firm owners quickly scale a systematic firm of their own and help them avoid the pitfalls that most firm owners fall into when they’re trying to create a great business, and one that gives them a great lifestyle. I started Future Firm Accelerate about a year and a half ago, which is an online coaching membership program that provides online training, online coaching, and a fantastic community of close to five hundred modern, entrepreneurial, forward-thinking firm owners, that all get together and collaborate online to help each other create amazing businesses. 

So yeah, that’s a little bit about my background and what I’m up to at the moment. 

Alright, well, that’s cool. And so ‘13 is when you started this, your online accounting business. So you and I talked about Matthew and Kenji, from Acuity a little at the beginning. That’s about the same time they started, wasn’t it? 

Ah, that’s a good question. 

And weren’t they in online accounting?

I think they might have even started a bit earlier. I think Kenji had started—

—Oh, that’s right—

—and Matthew had come in a little bit afterwards. And yeah, they’re just two of my favorite people in the industry. Matthew is actually a member of Future Firm Accelerate, so a valued member of the program and community.

Nice!

And yeah, I’d consider them friends. I’d consider them leaders in the community. And I have nothing but great things to say about them.

Yep, and you’re right, that’s what it is. I think that’s when Matthew came in around ‘13. and joined Kenji, and Kenji, I don’t think wants to admit it, but that’s when the firm took off. So he doesn’t want Matthew to know that so we’ll keep that quiet. 

Alright, but that was just interesting when you said ‘13, that clicked into my head. And that’s pretty cool that, you know, you had that idea, they had that idea, and you’ve both done well with it. 

Alright, so let’s talk about this—you know, if you want to, I was very fortunate on a plane today, listen to a bunch of your podcasts, or, you know, just six, seven minutes of education, which is awesome, you do a great job, and I am going to be listening to more and more of those. But one of them I listened to was what one of the key—what was it—one of the key things you need to do to start creating this scalable firm? Do I have that right?

There’s a couple episodes, maybe in that vein.

Okay!

One of them was “the six part formula to scaling a firm.” I don’t know if it was that one, Randy, or something else. Or “the first thing you should focus on if you’re looking to create a scalable firm,” maybe it was that one? I think was a recent one.

Okay, so, alright. And maybe it was that. Maybe it was that because I think that was where you were kind of talking about niche a little bit. At least, that’s the way I took it. And so, but we were already talking about, you know, creating the scalable firm. And so why don’t you just start to educate us on that. What would this be? Maybe it is that first step, but what are the steps you want to go through to make this scalable firm? And before we even do that, let me back up. Why do I want a scalable firm?

Yeah, so it’s a good question. I mean, ultimately, all firm owners, firm leaders, partners, what we’re looking to do is we’ve created this business to give ourselves a better life. 

Yep. 

That’s why we got into business. Yes, we get fulfillment from it, from serving our clients, and helping people out, but we also want to give ourselves a great life. And usually that’s reaching a certain kind of compensation milestone. Usually, that’s also dictated by giving us more freedom and more free time, so that we can spend time with our family, and travel the world, and do all these amazing things. The problem is, most firms are not living up to that. 

Yep.

They’re stuck working crazy hours, lots of stress, crazy busy seasons, and they have a model that could grow, but it doesn’t scale. 

Okay.

The growth comes at the expense of just spending more time in the business. And that’s the big difference between growth and scale. Scale is when you can create a model that adds to the top line without adding to the amount of hours that you have to put into the business. 

Got it.

So that’s what I want to help firms with is create a more scalable model.

Nice.

And scaling professional services is extremely difficult. The nature of the business, it’s probably one of the—it’s probably the hardest type of business to scale, because we’re providing technical expertise and advice to our clients, and they’re relying on this advice when it comes to taxes and a whole host of other things. So it’s a very, very hard business model to scale. And my approach is, we can scale this model, if we focus on standardizing many different elements, and many different components within the business. 

So when, you know, when I’m coaching different firms, or different students of the program, one of the first things they get in touch with me for is, “I want to scale,” or “I want to streamline my business, I want it to operate more smoothly, and I need technology. I need automation. That’s going to be the solution to it all, just give me all the automation possible.” But I’m going to push back and say, well, automation is just like one sliver of the pie, or one piece of the puzzle. There’s a whole host of other elements that you need to have in place, if you want to create that smooth business model that works systematically, that works like clockwork, and allows you to take a step back from the business. 

So I’m going off on a few tangents here, Randy. But the first thing that I actually proposed, that firm owners focus on if they want to create something scalable, is to start focusing a little bit more—focusing on the type of client that they service. And I’m not saying you have to go ultra narrow, but most firms are like, super broad and wide in who they service.

Yep.

But also very, very important, that I think was that podcast episode you were listening to, we need to create a service offering that operates within our sweet spot and just focus on selling that. And have a formula for delivering that kind of sweet spot service offering, so it can be delivered systematically and consistently across the entire client base. That’s when you can pull yourself out of the business. 

So those are just two pieces of the pie. 

Okay.

And I have six elements—six parts—to creating that scalable accounting firm model: Technology, a well defined customer base, a subscription based productized service offer, standardization of all your processes, an inbound marketing engine, and a team that’s aligned. If you put all of that together, that’s when you can create a scalable business.

So it’s that easy.

It’s just like that! Just snap your fingers and it’s there!

Okay. How do you do all those things? So I was in practice for a long time. You know, I sold my firm in 2006. And I was probably not doing nearly any of that. And the reason I sold is because my hours just got crazy and I got burnt out, and that was the best option, which really ended up being the best for me, because I love what I’m doing today. But yeah, I wasn’t doing anything that you suggested I should, and I probably would have been much better if I did. So give me, give people, an idea, how do they start to implement things?

The first thing that I recommend to start with—like, all of this is a journey. None of this happens overnight, business is a journey, we’re always iterating, we’re always improving. So like if someone thinks they’re just gonna like flip the light switch, and they’re just going to have this like, amazing model overnight, it’s not going to happen. 

Right.

But where I start on everybody’s journey, what I’ve seen is the common theme, the common denominator that people need help with, that’s preventing them from scaling is first, they’re underselling themselves. They have a service offering that’s way too broad, and they’re not charging enough for what they’re doing. 

Yep.

So if you, if that’s your foundation, then you’re just you’re just going to drive yourself into the ground. So the first, first step is, let’s figure out what your sweet spot is in your firm, and just package those services up into a set offer. I usually like to do it into a gold, silver, bronze approach. And let’s just get those offers out to your existing client base and to new customers. That will then put all of your clients on the same sort of offering, which can follow the same sort of processes, which means your team members can take those over a little bit more easily. So that it’s not like a custom approach for every single client that comes into the door. And make sure that we’re pricing that appropriately. 

Right. 

Because I’ve been so surprised, when I got into this business in the first place—coaching accounting firms—I never thought that I’d be helping accountants price. I never thought like, part of my coaching involves like, analyzing their financial statements and realizing like, “There’s a pricing problem here.” I’d never thought I’d be analyzing accounting firms’ financial statements. I thought I got away from those analyzing financial statements forever. Anyway, I’m going off on a few tangents here. 

No no, I’m directing you onto tangents. It’s not you, I’m taking you all over the board, so. 

Okay.

So I’m gonna do that right now again. So go back to what you’re saying. It’s like standardizing your service offering. That’s how you said it, right?

Standardizing your services and saying, “This is our bronze package—this is the minimum package that you need to take with us, in order to sign up with our firm.” And also having a gold package, and saying, “This is the maximum of what we want to deliver as a firm. We’re not going to go more than this. This is within our sweet spot, and the silver sits in the happy medium.”

Yep.

If you could figure that out, and get all clients on to those range of packages, they’re all going to follow the same kind of formula—they’re all going to be onboarded in the same way, the work is all going to be delivered in the same way, and then we can get something in place that’s more routine and repetitive. 

Okay, I get you. So putting processes in place—which that is not my expertise—putting processes in place to standardize everything, so everybody’s on the same page. And what you’re also doing then is—you’re not only being scalable, but maybe this is what you mean by scalable—you’ve got the sustainable firm, because you’re not the, it’s not sitting in your head, how we’re doing this, this is now everybody in the firm understands that we have these three packages, and these are the three things we offer within each, or whatever, the 10 within each  package, and they all have standards. Wow, that makes a lot more sense. I can see how you could be a lot more efficient in that. 

Let me ask a question on that. If we’re standardizing, and you know, we have these three package offerings, and we have, you know, this is what you get in you know, gold, silver, bronze—whatever you call them—is that then spread across all our different types of clients? Or I assume it’s going to be better if we’re also a niche business, we’re a niche accounting firm too, where, you know, we’ve got two or three different niches we deal with, because then you even get more standardization, you get more workflow going. Well, I’m rambling on this question, but you understand what I’m saying, right?

The more you narrow, the easier it will be to scale, I think is what you’re asking.

Yes. Okay, got it.

Like, you have a client base, and I see this with most of the firms I deal with, where you handle clients from zero employees to 200 employees, from $0 in revenue to, you know, I don’t know, $100 million dollars in revenue. If you have that spectrum of clients, then that three package approach is just not going to work. Or you have to have multiple three packages for different segments of your audience. And then we’re just getting into, “we do everything for everyone” at this point. 

So the narrower you go, the easier it’s going to be. And I’m not suggesting you have to go super narrow, but certainly a lot more narrow than what most firms are doing at the moment, because most firms are just doing everything to everyone, every kind of service to every kind of client. “We’ill use this accounting software for this client, and that accounting software for that client.” What I’m suggesting is, the firm dictates the rules. The firm says, “This is how we do it. These are the packages that we’re going to put you on to get you the results that you’re looking for. You follow us, we don’t follow you.”

Yep, yep. And then price it correctly, which is huge. 

Correct. 

And you’re doing three tiered pricing. 

A big issue for a lot of firms.

Yep. And three tiers is what you suggest, I mean, is there value, is it a hybrid of anything, or it’s just straight three tiered pricing?

There’s different approaches, but most firms are going to adopt a value-based approach where they’re going to price each individual client separately, based on the value that’s being provided.

Okay.

So, you know, I do have a methodology for applying this. But I mean, it depends on the firm. I know some firms that have, like, a lot of leads coming through the door, and they don’t want to price every individual client separately, and they say, “These are the three buckets, you have to fit into one of these buckets, and these are the price per bucket,” and they can just onboard clients very quickly. It depends on the type of firm that you are.

Okay. Alright. So I took us in different directions. So did you want to keep going down the path? Otherwise, I have some questions for you.

You take the path you’d like you’d like to take, I go in whatever direction you want. 

Nice! This is awesome. Alright. So I love talking about pricing, because they’re so all over the board. And I actually, on my webinars, often I’ll just put a random question in there like, “How are you pricing your services? Fixed fee, hourly, value-based, three tier,” and and almost always, the answer is majority hourly based. And I think that is changing, I think that will continue to change. Do you think that’ll go away? Hourly at all? Or do you think it’s still here to stay?

I mean, among the students in my Future Firm Accelerate program, it’s not even a discussion point truthfully. 

Really. Okay. 

You know, they’re all fixed price, value price, you know, subscription pricing. Just, I could not advocate for anything other than that. 

Yep. 

I think ultimately, we have to look at what’s best for the clients. Like, we’re in the business of serving clients, we’re in the business of making sure that they’re happy, and customer experience is more important than ever. And, you know, you look at the industries that have fallen by the wayside, the typical taxi industry, for instance, you know—Uber came in, and they just provided an easier, better experience. 

Yep.

And that’s the same thing that’s gonna happen, you know, in the world of accounting, and there’s no client that I know that would prefer the hourly rate over a predictable subscription price or a predictable fixed price. You know? That’s one important part of offering a good customer experience. 

Yep.

Now, it’s a harder model to adopt for a lot of firms. And that’s probably why a lot of them are still billing by the hour. But for me, I just look at it from a customer experience standpoint, and what’s better for the customer.

Okay. Yep. So you’re talking about putting this package together, and then being able to offer this to your existing clients, and be able to offer this to new clients, and, you know, onboarding new clients, and you make this, you know, more standardized. But then you also said, now you can go out and get new business, and you’re getting inbound sales. How do you use that as a sales pitch? How are you getting these inbound sales? Are you teaching sales opportunities or marketing opportunities? Or how do we get to the next step? Because now we’ve got to grow the firm, because in this process, we’re probably going to lose some clients too, I’m assuming.

And if we do, that’s probably a good thing, because it’s probably not the clients that we want. They’re not the clients that fit into the sweet spot. 

Right.

But all the elements of creating a scalable firm, are all the elements that I teach in the program, and are all the elements that I had to figure out myself from the ground up when I started my firm. You know, I was a terrible, terrible accountant, but I was good at all the other stuff. So very quickly, I had to bring more experienced people onto the team to handle the accounting because I was a liability there. But I really found out that I loved the marketing. 

And, you know, the first few years of running my firm, I knew nothing about marketing. I knew nothing about acquiring clients, and what to do there. And I tried all kinds of different strategies. And the one that stuck very early on was just networking, and just heading out to the—all, every single networking meeting that I could attend, I was there. I didn’t particularly like them, I wasn’t particularly good at it, but it did bring in the first few clients, but it’s an activity that doesn’t scale because it revolves on your time and you going out and spending longer days somewhere. And I wanted to find other ways to bring business through the door. 

I tried a whole bunch of digital marketing strategies. 99% of them flopped, but I found some that stuck a bit. And then it just kept working those, working those, working those, and over the course of ten years, I’ve honed in on some digital marketing strategies that work very well. And most of them that work very well, still to this day, is content marketing. Getting your expertise out there in the form of blogs, in the form of podcasts—it’s one of the reasons why we’re both on this podcast today is because it’s a form of content marketing. And it’s a way to get in front of an audience and build trust with that audience. 

Mmm hmm!

Webinars, speaking engagements, you know, social media, anytime, when you’re sharing anything of value through any of these channels, that’s a way to build trust with an audience. And once they trust you enough, you’re in a good position to then pick up that business. So there are some strategies to making all of these different channels and tactics work. Some obviously work better than others, depending on who you’re targeting. But yes, this is, you know, to answer your question, this is what I help with, and this is an area of business that I really enjoy, is helping put in place these inbound marketing strategies. 

Okay, and that what I like about that is, you know, doing that, but you also—we talked a little bit about, you know, having niches as well, you know?

Mmm hmm.

Being a little more narrow, because it can standardize everything better. And I see, and I don’t know if you’re familiar with Josh Lance at all?

Yes.

Alright. And Josh is a niche practice. I mean, he’s, you know, probably, you know, half of his clients are craft breweries, probably, maybe more. 

Yep. 

And he and I talked about it, he taught me this, basically, you know, he, on Twitter, and webinars, and LinkedIn, and Instagram, and wherever, puts out all this content, and people realize he’s the expert in this industry. And so, you know, I’m guessing he is very standardized with his offerings and everything. I’m guessing he follows something like the type of thing do you teach, and he might even be in your program. I don’t know. But I’m a huge proponent of niche, which I never was when I was in practice. And the more narrow that niche, I’m guessing, that the better it’s going to help and this marketing aspect, you’re saying, right?

Yeah. I mean, there are risks to niching. 

Yep. 

There’s also opportunities. I mean, you know, the ones that focused on restaurants during COVID, probably weren’t feeling so great for at least a good year. 

Right.

So there are some risks. And I’m really not advocating that you need to just focus on one vertical.

No, I know, I know. I’m advocating that. Not you. It wasn’t you who were saying it, it was me.

And look, I’m all for it. I’m all for it. If someone wants to go out there, you know, I have, like, you know, students on my program that just focus on artists, or just focus on creatives, or focus on eCommerce.

Right.

And all marketing is, at the end of the day, is deeply understanding someone’s pain points and challenges, and being able to communicate a clear-cut solution. And if you’re just targeting, you know, 20 or 30 different types of businesses, you’re going to have a very broad understanding of their challenges and pain points, or it will be a very vague in the way that you communicate that message in a way that just doesn’t stick in their minds, basically. So the narrower you can go, the more powerful your marketing becomes.

Yeah. And that’s again, having one niche on its own, is probably not the best thing. When we started Tri-Merit, that’s what we were, we were a one trick pony. It was R&D tax credits only. But I love doing it. I love talking about it. I love working with it. But the R&D tax credits go to different industries—we added more specialties. But the cool thing we do, and I don’t know, I’m assuming you’d probably agree with this. R&D specialists are not also cost specialists. They concentrate on one thing only, and our WOTC specialists are WOTC—they don’t deal with when 179D. And I assume that helps with the whole, you know, keeping things moving smoothly and having this in place. 

Alright. I know I put words in your mouth. 

You said it, not me.

Are you saying you’re denying that that’s good?

I—I—I’m in agreement.

I’m sorry, Ryan, I get a little goofy on these. So I appreciate you being on. 

Alright. So this is really cool, because I know so many, you know, small firm owners that are struggling the way you said. I mean, they’re just working like crazy. I can, off the top of my head, I can think of ten people that are just, you know, in my neighborhood it  seems like, that are living this life right now. And they don’t need to.

Yeah.

So anything that you know, when I took us down ten different paths, anything you want to ramp up this scalability with?

Yeah, I’d say, you know, nine out of ten times, the first issue to be worked out is getting your offers down pat, because everything else in your firm flows from your offers. So getting your your packages down pat, and making sure you’re pricing them well. 

Yes.

Like, again, you’re just going to drive yourself into the ground if not. This is what I see over and over again. 

I agree.

Once you have that in place, then you build off that that becomes your foundation. Then we can look at automation, then we can look at streamlining your processes, then we can look at, you know, bringing the right team on board. 

Yes.

But there’s no point in accelerating something that’s not working and broken at a foundational level.

So fix the foundation, then the rest can fall in line with coaching from Ryan. 

Absolutely. Don’t forget the last part. 

Alright, so one last thing then, before I ask a final question, but one last thing—what do you do when you’re not out coaching? And I think I know an answer on this because I heard on the podcast one thing you like to do, but tell me what you and your family, or you personally, like to do when you’re not working?

I’d be curious to hear what you heard on the podcast. But my latest hobby has involved training for a triathlon. So I’ll be doing my first one this summer. 

Oh, wow. 

So that’s been interesting and fun and challenging. And we’ll see if I come in last place or not. 

And, you know, traveling has always been a passion of mine—traveling to like, you know, remote, exotic destinations. But I haven’t had the chance to do that in the last few years. But hopefully that starts ramping up again. So those are two of the things that are, I’d say, I’m passionate about.

And the travel was the one I was thinking about. But then right when you started talking I did see that somewhere, you wrote I think you were very into—was it CrossFit? Is that what it was called?

I still do CrossFit. But I’ve I’ve scaled that back as I ramped up the triathlon training, and then who knows where that goes? I just like to be active.

Yep. Alright. Well, I appreciate you being on here. I saw people commenting on your newsletter. And is that what you call your email? It seems like it goes out daily. Is that right?

It’s a weekly—actually, it’s twice a week now. It was a weekly email for the last three years. Future Firm Weekly Top Five, where I curate the top five things that firm owners should know about each week, to help them scale their firm. And now, on every Sunday, I’m sending out a two sentence, three sentence, very quick email that gives one actionable tip to help you scale your firm. So yeah, twice a week now.

Alright, well, I’ve been reading them and I appreciate it. Anybody can go sign up for that. So why don’t you give a way people and go sign up with that and why don’t you give a way people can get ahold of you if they want to. 

Sure. So futurefirm.co/newsletter. That’s where you can sign up for the newsletter, highly recommend, free, there’s around 7,000 people that get it every single week. And futurefirmaccelerate.com if you’re interested to know a little bit more about that online coaching program. 

Alright, awesome. I know your contact information, and you’re on LinkedIn and everywhere else too, so they can find you anywhere. 

Well, Ryan, I really appreciate you taking—letting me allow—I really appreciate you allowing me to take you in about 12 different directions. And hopefully we’ve circled back and got everything back in place at the end. But I can’t talk highly enough about what I’ve learned just from the last month of just reading your newsletters and everything. It’s been awesome.

It’s an absolute pleasure, Randy. Thank you very much for having me on the show.