How I Bought 90 Businesses and Built a $128M HoldCo | Brett Kelly of Kelly Partners

0:00 Today's guest is Brett Kelly, founder and CEO of Kelly Partners Group Holdings, an accounting firm which has completed more than 90 acquisitions and built one of the most distinctive consolidation stories in professional services. Over time, the company has compounded revenue at more than 30% annually. In 2009, Kelly and Partners generated roughly 400,000 of EBITDA. For 2026, projected EBITDA is expected to reach 50 million. Thanks a lot for coming to the Buyers and Builders podcast, Brett.

0:35 We're going to go through the the past, the present, and the future, obviously starting from the past. And I found something you have said, "I lost a job at 22. I didn't know what I wanted to do. I was an advisor in an investment bank, and it taught me that I wanted to do my own principal-based deals." So, a lot has changed since then as you've gone from being absolutely confused to to now being world-class focus and having this clarity. But take us back to this period of of your life, Brett, at 22.

1:11 >> Yeah. Me I was I just consider myself to have been very lucky and very blessed. At 14, I was washing cars and mowing lawns and blower vacuuming people's tennis courts for pocket money, and then I was coaching sport and getting paid. And then I went into accounting at Price Waterhouse as an undergraduate at 18 because 2 years before that, a a financial controller had embezzled money in my father's business. And so, I saw how important it was and how much that had impacted my dad. He always thought if he'd been an accountant, that that wouldn't have happened. But you know, I later understood that even when your company's audited, fraud is difficult to detect. So, I went into accounting, I did 4 and 1/2 years, and then I went into an investment banking corporate advisory.

2:07 And while I was at Price Waterhouse, I I was involved in the EVA group, the economic value added group. reading books like Creating Shareholder Value by Alfred Rappaport, and and starting to understand capital allocation. From the age of 17, I've been sort of reading everything that had been written on or by Warren Buffett and Charlie Munger. And so, I had those sort of you know, first book I read on investing was Philip Fisher's book of Common Stocks and Uncommon Profits.

2:40 And so, I thought I'd be an investor, build a global business. That was kind of my vision of of of what was possible. The the businesses in Australia that were most successful, that were global, that I could see, were Westfield Shopping Group built by Frank Lowy, and News Corporation built by Rupert Murdoch. And they were both Australian who built these global businesses. So, in the back of my mind, I thought that's what you were meant to be when you grew up. and you know, I I lost my job in investment banking. Everything had been a bit of a straight line.

3:17 And, you know, the feedback I had was that I didn't get on with old people, which wasn't really true. It was just that I hadn't found my people. You know, I wasn't a natural advisor because I like to make things happen. I'm I'm very energetic. I'm thoughtful and you know, fast brained. And you know, and and what I found difficult was if you said to a client, you know, they asked you for advice, you gave them advice, and maybe they didn't, you know, get up very early, they didn't stay up very late, they didn't make things happen.

3:52 It was frustrated, so I lost the job and there was a great sense of relief that now I could do whatever I wanted. So, my dad gave me two books, How to Win Friends and Influence People and Think and Grow Rich. And Think and Grow Rich says, find people that have been successful and ask them what they did. So, I wrote to 80 prominent Australians. I came up with 11 standard questions and I said, "My name's Brett Kelly. I'm 22.

4:14 I'm unemployed, but I'm keen to learn. If you'll answer my 11 standard questions in a face-to-face interview, I'll put it in a book. I'll get it out to other young people who also want to learn. during that process, I learned that I had no money, no experience, no publishing expertise, no connections, and really no idea of what I was doing, but I believed that through doing that, I could get ideas about what I wanted to do.

4:41 What I really learned was that everything you want to do, you do with and through people. And that you know, being able to lead people and get on well with people was the most important thing. But I also learned that you could put a team together and get a huge amount of experience if you could work well with people. And in none of my university degrees, I have an undergraduate degree in business and a master's degree in taxation.

5:07 I'm a chartered accountant in about five countries. I, you know, the emphasis was on technical skills, not on on on working well with people. And so, in that team, I then, you know, I went to publishers, asked them to help me publish the book. And they said, "You know, you're not famous. Who will read your book?" And I said, "But I'm 22. I'm unemployed. I've got a good story." And the story I believed was more important than being famous.

5:38 And I I bought out of America a 22-tape 24-tape series by Mark Victor Hansen, who'd written the Chicken Soup for the Soul book series, and they sold 500 million books, and it told you how to self-publish a book, how to promote your book and sell your book. And I I just did exactly what that said, you know, I I was now reading a book a week. I bought the whole Simon and Schuster self-help tape catalog, and I put them in a bookshelf, and I thought, "I'm going to write this book." And I listened to the tapes, and I read the book, and it convinced me that learning's the most important thing, and that my natural talent, anyway, was learning, so that was good. And so, I started, I made you know, I have a I did it was 3,000 phone calls in 12 weeks. I tracked down the people, I got the interviews.

6:36 But when I went back to the publishers, they said, "Oh, well, we didn't think you'd get the interviews, but now you have, you know, who's going to read your book?" So, I had to self-publish the book. And so, that book became part of a series of books. So, so that was this book. And when I did it, people thought it was going to be a brochure, but it's a proper book. And then, I every 7 years since I've done another book.

7:04 So, for 28 years, I've published this series of books on wisdom. Now, in reading all these books about what life was about, life turns out to be about wisdom, to to be about growing in deep understandings. So, no matter what you do, you should really try be a deep person in a shallow world, be a long-term person in a short-term world. And as, you know, and and that is you know, sort of Charlie Munger invert invert invert. So, I'm there, having done the book and a lot of professional speaking, I went back into chartered accounting. I worked in three different firms and I was so frustrated.

7:45 I went home with we had a 9-month-old child. Three months before that I'd started a firm for friend of mine because he was having troubles in the firm he was in and big insight big insight often other people see talent in you that you don't see in yourself. So, my friend Scott had worked with me at an accounting firm and he rang me up. I'm the godfather of his son and he said, "Brett, you're so good at running businesses and you know so much about it. I'm not really good at accounting. Could you run the business and I'll do the accounting?" And that's where our partner owner driver model came from.

8:20 I said, "Well, he said, "You have 75% and I'll have 25." And then when I did the numbers, I was like, "No, Scotty, I'll 51 you have 49 because I think I can help you run the business at twice the profitability of the industry and then you'll still be making the money you would if you worked for these other idiots, but your life will be good and we'll be doing something great together. and the financial model will work.

8:47 So, I read about 3,000 books on this journey over many, many years. at least a book a week for years and years and years. And you know, I you know, Munger talked about being a book on layman's terms. I just have a voracious sort of consumer of and integrator of knowledge from wherever I can find it. And so then in June 2006, my boss, Rebecca my wife and I had just had our first son, Thomas. And my boss, he had promised when he recruited me a year before particular undertaking and and then when I said to him, "Well, what's happening with me becoming a partner?"

9:26 He said, "Well, problem is if we do what we said we'd do, you'll own half the firm and that, you know, we wanted to own 10%." And I said, "Okay." And I couldn't understand why that made sense. So, I rang two of my good friends who are very successful entrepreneurs. I'd worked when I did my first book in a software company that made the first software for EVA valuation of companies. It was a valuation tool that linked to Bloomberg data source, and it produced eight different versions of a valuation of a public company. And so, I was very deep in valuation, and I Anthony said to me, "Brad, I thought you'd already have a company of your own, your own firm. I don't know what you're doing." So, I thought, "Oh, okay." So, I rang my other friend, and he said, "Yeah, why why don't you have your own firm?" I thought, "Oh, okay." But again, those two men saw in me things I didn't see in myself. I was really trying very hard to be a good employee and do the right thing by my boss, but I couldn't get the boss out of bed early, couldn't get him to stay up late. He didn't really have a passion for what he was doing.

10:36 So, I felt like I didn't fit in again. Cuz I'm really 24 hours a day, 6 days a week, and I want to be very much world-class at anything I do. So, when I did my first book, I made sure that book looked as good as any book in a bookstore, even though it was self-published, and it became a top-10 bestseller. When I did my professional speaking, I hired the best professional speaking coach, and he helped me structure my presentation and taught me how to present the presentation, so that I was the youngest accredited professional speaker in Australia, 22 years old. I spoke at the National Press Club in Canberra twice, launching two of my books. So, it was always, if you're going to do it, do it the best it can be done.

11:19 You know, my dad had a saying, if you aim for the Rolls-Royce and you fall short, you drive a Mercedes. If you aim for the Mercedes and fall short, you drive a Ford. And if you aim for the Ford and fall short, you know, hopefully you like walking. so it was like really aim for the stars and if you fall short, you get the moon, you know. So that that was the journey. I turned around at my wife and I met Rebecca working in an accounting firm and I have to credit back for her confidence in me because again, you know, it's important the people that have confidence in you when you don't.

11:57 They can see things about you that you don't. And Becks like, why don't you just start your own firm? You're really good at this and you can just build a comfort. And I was like, what are you talking about? this is annoying. Our industry is terrible. It's full of these people that say one thing and do something else. Why do I want to do this? She's like, you're great at this. Just do that. So that was I thought, oh, okay.

12:21 So I am yeah, started Kelly Partners in 12th of June, 2006 and I had a very very clear plan as I always do, Vic. and that was to build a better accounting firm for the people that worked in those firms like me and for the clients of those firms and for the communities that they operated in. I genuinely believed that an accountant could make an enormous difference in the lives of of their their people and their clients in the community. I just knew that. What I had seen was that often the accountant was there but it didn't or she didn't really do anything. They just couldn't have a conversation, didn't really care about the person, didn't really want to get to know them, couldn't really help them as a result.

13:14 So I thought, righto, let's build a proper business. So you don't look at the accounting firms to get depressed. I said, right, let's look at across people, process, clients and financial the best firms in the world. Look at at firms like Google that people want to work for. Firms like in particular Disney that people want to work for. Then for for process, I said let's look at organizations that have great process like McDonald's. Then for clients, let's look at Four Seasons, Ritz-Carlton, Apple.

13:51 In particular, Ritz-Carlton. and then for financials, let's look at Berkshire Hathaway. And it was just you know it's good to talk about really because you know these are these are big inspiring formative And I was writing those down. I'll tell you why. So, when I when I tell you that across people process clients and financials those big four companies, they had Disney, McDonald's, Ritz, and Berkshire Hathaway. They are all American companies and they were just out and out heroes of mine. I just thought Walt Disney was the greatest. I still do.

14:30 Okay? I thought that McDonald's is the greatest business system in the world and it probably is. I thought Ritz-Carlton was just an incredible organization because when I was about 20, Mick, I was in the hotel auditing group. It was part of what I did because my father was in food service and I audited the Ritz-Carlton Sydney and they was just setting it up and I met the general manager. He was the youngest general manager in the world and he told me about when he was recruiting that hotel, he saw a girl a a woman in in the line for a job and he said I'm going to marry that woman and he asked her seven times and on the eighth time he said this is the last time I'll ask and he took her on her first date and he proposed and they got married. but they were famous for their customer service and their Berkshire was my hero.

15:13 He still is but in particular, Charlie Munger is is my big hero. And so and the reason I'm mentioning that in you know in such strong terms is you know, 20 years later we moved to the US in January 2023 or 17 years later, I always had a plan to build a global business. I always you know, kept that very quiet because people tend to mock your plans, particularly in Australia. My wife again saw that. She said, "Brett, we have to go to America because all your heroes are American and the way you are will be more comfortable for you in America than in Australia."

15:50 and and so I'll share that with you later as well. So So I've got right, build a better business system based on these great companies. Life is better. One of my favorite sayings of my own Mick is that life is better that when you're looking up. You know, when you're looking down the people that are depressed they look like they look like this and people that are that are energized look like this. And so if you if you want to change your day, look up.

16:20 Whereas most people's posture is genuinely bent over with their head up their own ass wondering why everything's so and smelly and dark and it's because their focus is on themselves. Whereas if you can look up and out, you can see other people and you can see opportunity and you can have much more energy about what you're doing. So I looked up to these people. I looked up to their businesses and I said, "Why don't we take this tiny little idea of the accounting firm and just try as much as we can, as humbly as we can to make it a bit more like these businesses and don't look at accounting firms because I looked at accounting firms and I was like, " that's horrible.

17:01 I I want to be like this when I grow up." And so that's what happened. And so we've got a business system, not an accounting firm. A business system for an accounting firm. Everything I'd read in all these books, I said, "Right, the best type of client is a private business owning family with complex affairs. They stay with their accounts for 30 to 80 years or longer. They're long-dated people, right? Buffett, be long-term. Type of client we want because we've got to spend a lot of time with those people is a long-term clients and really shares our values. We've got to have clear mission, values, and vision.

17:35 All right, so what's that going to be? Well, we've got to have Our clients who want to make the world better, they want to make other people better off. They want to be people that are there for others that keep their promises, plays part of a team. And basically, I'll find it for you, but we built a system. I'll just get you a copy of it. So, be quite the gift. There's normally one in my office, but I got this little thing called a progress pyramid. It's in my new book called progress, which will come out later this year for our 20th anniversary. And And this pyramid basically has 12 parts of a business from mission, vision, values, strategy, structure, all the way through people, process, clients, financial, IT, risk, brand, growth, and succession. And I said, "Look, you get the person right first based on Maslow's hierarchy of needs. And then in here, you work out the 12 parts of a business.

18:34 Below here is the foundation, above here is operations. We built a system. And then what we did was we relentlessly applied that to accounting firms. There's 12 or 14 steps. Everything's documented, manualized. There are videos to help you do everything better. And the idea was just systemize a business at a very, very deep level. And then it was as simple as go around Sydney and go to secondary markets and try and become large before anyone notices that you exist.

19:05 So, we we basically Sydney's here. Everyone goes to the center of the city. I went north, northwest, jump, jump, jump, jump, jump, jump. And we basically following Jack Welch GE by the number one or the number two firm in each area. We'd buy 51% of partners that own 49, we'll double their profits, take 2/3 of the of the working reduce the working capital needs of the business by 2/3, give the partners 25 to 40% of their time back, and then just do it over and over and over and over and over again.

19:34 And so that's what we did in Australia. We're now into Hong Kong, and we're into actually about to start our first operating business in Hong Kong, but we've had an office there for 10 years. We're in the Philippines with a BPO business, and we're in Ireland, and we've and we've got four offices here in the US. and you know, the opportunity in terms of addressable market across Australia, the US, the UK, all of Europe, South America, we can basically go anywhere because we have a business system that can help a professional services firm be much better.

20:07 >> This is an excellent overview, Brett. >> But I can give you the >> I'm sure. I'm sure. I'm sure. When it comes to this manual, this this pyramid, when you first got started when it comes to the maybe first five 10 acquisitions, how much of this had you already prepared? Or I'm I'm sure it has you have improved that over time. >> So the first day of the business, so on the very first day of the business, I wrote this book.

20:35 And I I wrote this book as a training manual for our accountants to tell them how they should treat the clients. So my One of the things I love about Charlie Munger and Warren Buffett is Warren Buffett when he's asked, you know, what he loves to do the most, he really loves to teach. You know, he's a learner, I suspect. And I'm very much that, and so my real talent is learning and understanding, and then putting things in a way that we can teach them to people and share them.

21:10 And so I had this as the way we wanted to do business. And I built a what I what's called a critical activity network of the business that I that I had learned about in another book based on how IKEA had organized themselves. And I just basically sat down like an architect and designed what the workflow should look like, what the firm should look like, where people should sit, how the store should be laid out, what the skew is. So I thought about how to retail accounting.

21:42 You know, what does the office going to look like so people feel good or attracted to working there and can work together in a seamless way. so talent-led for the office. What are the workflows of the major pieces of work we do and how do we streamline them so that they can give efficiency and not be annoying to the staff like the team to to participate in. And it was all about how do you make the human experience of the professionals better and how do we have a better outcome for the client?

22:08 So I was an you know an inveterate still am an inveterate tinkerer on the system, on the software, on the process to try and make everything work better. if I come to your house, you know, and you ask me how you could lay your bookshelf better, I'll probably have an idea. I I walk into businesses and I look at them and think how could they work better. That's why I great >> You know, the companies you first approached outside of Sydney, how was their reaction when you first knocked on their door and said hi, introduced yourself?

22:43 >> I wanted to check. Yeah, so one of the insights with was firstly, I was organically growing the firm that I started in North Sydney like this. So they could see that I knew how to how to win business. So they were like, "This guy's serious about what he's doing." I'd done a couple of acquisitions in the first 9 months with my old boss and a guy up the road, and then I went to areas that were unattractive to other people. So, those firms were like, "You really want to come to our area?" I was like, "Absolutely." And they're like, "Okay, great." So, there was less competition for to get involved in those firms, to buy into those firms, cuz other people didn't really want to buy those firms, but I did, and they all they just wanted the money. So, they were like, "Yeah, I'll take your money." And then I had all these big ideas, and they just treat you like you're crazy, and that's okay, because then they leave you alone, and then you just do the implementation, and then they're like, "Oh, this is great.

23:42 This is better. No problem." So, you can if you up front you try to explain too much, then people will argue with you. I I didn't explain. I just said, "Yeah, we'll we'll make things better." Then people don't really argue with you. They just They don't really believe you anyway, so you know, why waste time arguing? I didn't really try to make the business case. I just said, "Look, we're really helping." And we worked very hard, so >> When it comes to the organic growth, winning business, what would you talk if you had if you would have to give like a short presentation, because I think that's >> Oh, I just asked you me. I'd say, "Make Do you have a great accountant?" And most people would say, >> Mhm.

24:26 >> "What's a great accountant? I don't think my guy's great." I go, "What's his name?" And you they'd say, "Oh, John." I'd say, "Okay, well, you know, what a great accountant would do would would be they'd give forward-looking advice that was systematized at a fixed fee, they'd be available to you 24 hours a day, 6 days a week, and they'll change your life. Is that something that would be interesting to you?" To which people would say, "Yeah, absolutely." And then I would show them I'll I'll show you here.

24:57 We have a a system. >> Mhm. >> I'll just move my screen. Just that up. Where we address in the you know, pre-equals >> Mhm. >> personal, business, wealth, and estate. They get born, they go into business, they build wealth, and they die. And then I've built a whole system >> Mhm. >> show you cuz it's secret that we that we roll out to the client. But I had thought about a system for the client. That we give that to the client, sits in their study at home or in their office, and it's cradle to grave and multi-generational.

25:31 I've never put even that on camera before. We have tons and tons of trade secrets that we don't we don't share. Now we've digitized all that, that's why I'm happy to share it. >> This is remarkable. I've never seen a person so systematic, man, honestly. >> Well, a number of our investors have come here over here in Malibu, California, and they've sat at my desk and they've said, "How do you do this?" I open a spreadsheet where I have you know, one of my business heroes is Michael Hill. He built Michael Hill Jewelers in in Australia. Remarkable man. He collected Stradivarius violins. He was a violinist that would have liked to be a virtuoso, but wasn't. So he started international violin contest.

26:12 >> >> He He built a superyacht called VVS 1, which is the best superyacht in the world at the time it was built. He built a golf course where the New Zealand Open was, and he was knighted by the Queen. Incredible guy. But he wrote a book called Tough and Up, and he he he talked about having a 30-year plan. And he told me that well, in 20 years ago I read that. And and so I I have had it similar since I did my book 25-year plans, and since I open a spreadsheet, I show people the 25-year plan for Kelly Partners. I show them my own 25-year plan and how it's aligned in a spreadsheet and how how that all moves together.

26:49 And you know, a number of my investors have seen that, and they've been like, "Right. Okay, this guy's got a plan." You know, most people, as Jim Rohn would say, the great American speaker, you know, he said, "Be a meaningful specific, not a wandering generality." Most people don't have a clear plan for what they're trying to do. And so, they achieve exactly what they planned, which is not much. So, we took all of that learning and just pushed it into the business. We need clear business plans, we need a 10-year plan, we need a partnership with 10-year commitments. We have to have a long-term view. We need a deep system on the people side, on the client offer side, and on the op side. So, it's really how do you do Walmart in the back, right?

27:33 Walmart, McDonald's. So, my head space was we would be Walmart in the back of the business and McDonald's in the front of the business, right? So, it's a clear offer, Big Mac, cheeseburger, etc. we would be Disney where people love to go and work with Disney Costa, happiest place on Earth. We'd be Ritz-Carlton seven, you know, the the seven-star service, apparently. and Berkshire, and then we just took those ideas and applied them to our own business.

28:04 >> Okay, there's this plan, there's this system. What if things are not going as plan as planned? >> Yeah, so the good news is things tend to go more to plan when you have a plan. And then if they're not going to plan, you just have to re you know, reconfigure a plan. And now, everything that is the best about our system today, we've learned from plans that didn't work out. So, every time we had a problem, we had to work out the problem, and then we put that into our system.

28:38 And if you think that we bought into we've bought all or part of 95 firms. And so, those firms have hundreds of years of cumulative experience. And so we've been able to learn from every one of those transactions, but also from their history. What happened that was good, what happened that was bad. How did you deal with that? How did you fix that? And we built that into our you know, collective wisdom of our organization. >> You have this 51/49 percent partner owner driver model. You're a You lead a You You're reading a lot of books. There is this 80/20 rule. Have you ever considered any other other models? 80/20, 70/30? Why 51/49?

29:21 >> So the reason 51/49 works is that the average EBITDA self-reported in accounting firms in Australia, the US, and the UK is 18%. I think it's actually about 15%. And so we knew that if we can take If we buy half, but we double their EBITDA, then the firm the partners are making as much or more money than they were making before we got involved. And so that's a key part of what we do and why it creates great alignment. And I know that alignment's critical, so deep alignment.

29:58 So Mickey, if I come to you and say, "Look, last year you made $100,000. Let me buy half your business and next year you'll make at least $100,000. You get capital to go and diversify your your your universe after power for house or put your kids through college or clean up your retirement planning. but you haven't lost your earning power and it's a partnership. It's not a top-down model, it's a bottom-up model. So you're like, "Okay, this is good. Now I have a whole team to help me because I have all these things I want to do, but I don't have a team to help me."

30:32 >> What was the reason behind going public? >> Right. So in 20 Again, so Mickey, I I'm a big student of differentiation. It's hard to be different if you're the same as everyone else. And there were no listed accounting firms in Australia, the US, or the UK at that time other than CBUS. And it was really not seen as, you know, doing what we did, which is partnering with accounting firms, was considered not the the right thing to do. But I believed, with Charlie Munger actually, that public companies are the best form of of a company to run if you run them well. I believe that it would would attract talent, that it would attract firms, and that it would legitimize what we were doing. I wanted to prove in public our business model.

31:17 Whenever you're a private company, everyone says, "Oh, yeah, but that works in private, but it wouldn't work as a public company." I like a challenge, so I really like the challenge of building the company in public to prove that we have what I think is the best model for professional services firms anywhere in the world. And I believe that that would help us build a global organization. You know, reputation's important. >> You're acquiring companies with 2 to 10 million in revenue, right? Have you ever tried to acquire a larger one, or would it still fit into the system?

31:49 >> Yeah, the largest is probably 15 million in Australia. It really The size doesn't really matter in the Below a certain size, the private equity groups don't want to buy them. And they also don't really larger firms often want to join larger firms. So, we we want to buy firms from founders that have had blood, sweat, and tears poured into them. And they really want to partner with a founder. That's That's a key insight from Warren Buffett, you know?

32:18 I wanted to position as the Warren Buffett of accounting, meaning that if somebody really valued their firm, they would want to join Kelly Partners because they would know that I'm an accountant, and we would look after them. And that's really what Warren Buffett's off He's offered a high-integrity environment where he will look after your business after you've got a point where you can't keep doing it yourself. And so as a public company with permanent capital, I believe that that is a position that we can win and own.

32:50 And we can win and own that position on a global basis. And then that will give us real opportunities to partner with some of the best firms in the world. >> When it comes to capital allocation, you raised only 17 million Australian dollars over 20 years to build a business that could produce around 50 million Australian dollars of EBITDA. So, how do you think about capital efficiency in a world where we see many roll-up strategies require far more external capital.

33:21 >> Yeah, so they What we did is we really mastered When you look at the best businesses, they have the best business model because the business model wins over time because it's the model that allows the scaling. And so, what we believe that was that we could develop business model that was the most capital efficient of other business models. So, while we may not, you know, I've got another great book back here. This is a a book that I like, books. This is a hard book to get.

33:52 which is which is this book. This is Distant Force on Henry Singleton. and he was based here in California, which is really cool. So, you know, Henry Singleton was was it's about how far you get with the amount of fuel you use. and so, capital efficiency because of my EVA that graph valuation that graph is just absolutely paramount from day one. You know, I'm warm. If you want to build wealth for everybody, it needs to be on a per share basis. So, most people forget that.

34:23 We've never forgotten that. So, we built a business model in the way we do our acquisitions that is incredibly capital efficient. >> Now, there are a lot of acquisition platforms and they talk about synergies. But you said when you buy into a business, you can double profits. So, what are the biggest levers that drive that improvement so quickly so you can tell to those >> So, we don't really tell Mick, we don't tell people what the biggest levers are, but I get asked every day.

34:54 let me just say that the biggest lever Yeah, they're allowed. The biggest lever is leadership. >> At least I asked. At least I asked. >> Because even if you had a list of things to do, you have to lead that organization and that change. And so most people are focused on software, we are focused on the people and the leadership in the businesses. >> What about AI? A lot of people talking about AI to replace accountants.

35:23 >> Well, let's think about it. Today, more people are probably more ignorant and more arrogant and they have the toxic combination of that than people have ever been because our education system is particularly narrow, particularly shallow. Shallow. So, if there's less intelligence than there used to be, you know, that it's not a surprise that there's a great demand for artificial intelligence. But that doesn't mean that that's the solution to all the world's problems. I still believe that you're ultimately going to have to be able to lead people and inspire them to make a difference. There was a great article shared on Twitter by Mark Andrews yesterday that shows that technology grows economies and that this idea that AI destroys jobs is just not right. So, our view is that accountants should be doing about 80 things for a private business owning group. Typically, they do about eight. And the reason is that they don't have the team, the system, technology, or the money from the clients to actually do everything that the client would want. So, there's a lot more to do, a lot more.

36:28 >> I've highlighted on my notes when doing research on you. I'd like to know more on your take on permanent capital versus traditional private equity and the 7 to 10 year fund mandate. Your thoughts on this. >> Yeah, so I don't think private equity mandates are 7 to 10 years. I think that's fake news. I think they're 3 to 5 years. And importantly, what's most important about the capital in a business is that the capital will drive the velocity of the business. So, if you've got fast money, the business has to move fast. And not all businesses are really designed to move that fast.

37:03 So, when you've got a lot of people like we do in accounting, you can't move faster than those people can change. So, I think there's an inherent mismatch between the velocity of private equity money and the velocity of accounting firm. And I think that's >> What are some of the biggest headaches for you at this stage? You have those You have this extremely clear system when someone has a question. You send them a document or a book, they'll get an answer, but that >> This finance So, now our challenge is to to get the financing in a structure in a corporate structure that allows us to to grow the full potential of the business.

37:45 So, I spend a lot of time on financing trying to work out the best way to finance our growth that is capital efficient and isn't diluted to share. >> And on the whole core level, could you describe your hiring process? >> Well, we have a We have a 17-step process to hire people. It's a system that is firstly values oriented and we look pretty rigorously at people. When we When we get it right, we don't always get it right, but when we do, we follow our process and and it all works out pretty well.

38:16 >> Do you need to be a former accountant in order to No. >> Definitely not. It might not be an advantage we think because often people come with the prejudices and the bad habits of the businesses that they grew up in. >> We covered past. We talked a little bit about the present on how you run the business. what about the near future? How much do you need to expand outside of US considering the them in the US because there's so much opportunity there.

38:42 >> Yeah, so really the game is get our our company listed on an appropriate stock market. Stock exchange. Get a dual class structure to maintain long-term control of the business model. Raise the right type of capital. Ideally Constellation style 15-year debentures so that we can grow, you know, enormously and rapidly. So, that's the first piece of the puzzle, structure and capital. From a strategy perspective, you know, if anyone listens to the Acquired podcast episode on Starbucks, really that's what we intend to do. we intend to take the model into, you know, every market that that invites us in with firms that are interested in being part of our group.

39:34 And I think that we can own a thousand accounting. Currently, we own 35. So, there's no real lack of opportunity for us. >> What about you personally and what comes to mind if I say the word focus? What I'm trying to understand is you built a large firm, done so many different acquisitions on different continents. At the same time, there is an extremely clear system on absolutely everything. When I ask about something, you say hiring 17 steps. When it comes to post acquisition, there are like 204 steps. How have you been able to put it all together? Like it must be not not >> So, I think I think you have to have a fanatical commitment to what you're doing >> to do anything substantial and world-class. You look at a personal level for the first 5 years I didn't have a holiday. I never worked Sunday, but I worked from 3:30 in the morning till 7:00 and then 8:00 till 11:00 every day. So, I think that's very important. A lot of work. I think you have to have a unique sort of way of looking at things and not be scared of the status quo.

40:42 Most people sort of just like the status quo and they're too scared to do anything different. And then I think so, you have to be >> >> you have to be be crazy to believe that what you think makes sense actually makes sense. I think you need to find great people that share your vision. you can't be a leader without followers. So, you need to have people that believe in your vision and what's possible. And even if they don't believe in it, they're prepared to work in the organization while you prove out your model. I think that's really important.

41:18 And I think Yeah, and I think you you probably you need to to love what you're doing. You know, you need to actually like it. A lot of people don't love what they're doing. And I don't mean you know, you're to a great degree you'll love whatever you're good at, particularly as a man. But you can't do the work that you need to do, which is enormous, without some passion for it, you know? So, you have to have a You know, I call it a deep internal wellspring of meaning.

41:47 Like a like a a you know, like a well where you get water. So, yeah, it has to be the place you know, you have to build your life on a on top of a a well. You know, so everyone knows that you need to live near a well where the water is, otherwise you're going to die. So, if you think of your life, here's a well, that's where the water is for you, not for me, but for you, you have to build your life as close to that well as you can. The further away you get from the water, the more likely you are to die. And so, people will will meet me, and they would meet me, and they'd say, "Brett, you've got so much energy for what you're doing.

42:28 Why is that?" And I'm like, "Well, I have I'm building my life and my business on a well of meaning. I genuinely believe that disease comes from dis-ease, and that most dis-ease stress that people are experiencing in modern society comes from money. Comes from relationships and money. So, their relationship to themselves, to God, and to others, and to money. Now, I can't Yeah, those other things are hard to do, but we can help people organize their money, have a clear plan for their money, and to keep score cards against their progress against that plan, to take action, to to be organized, to have a plan, take action, keep score cards against their money. We can help them do that. And I believe that reduces their stress. That reduces the pain that they're in at a cellular level, so that they don't get sick. Maybe they they can focus on developing themselves and their relationship with their their partner and their kids and and their community. So, I genuinely believe that as an accountant, when I sit there, meet with someone, and I make their life better, and I bring down their stress in their shoulders, and they know where they are, and they know where they're going, and we deliver this emotional value that changes their lives. That means that I can get up every day and do that. I don't feel stressed about doing that. I don't feel like that's any effort. I never feel like I'm working, you know, at all, because all I do is I go from helping this person to helping that person, to helping this person, and whether that's people within our business or client. So, the same thing.

44:09 And I I just That means I can do it all day, every day, no problem, except Sundays. I take Sunday off so I can stay normal, stay stay connected to who I am and where I'm trying to go. So, that's that's the game. >> Brett, that has been fascinating. I I can see the passion. >> That's the That's That's kind of what we're doing. >> Mhm. >> And and and look, Mickey, in our industry, accountants don't have any passion. They don't have any energy generally for what they're doing. Our firms are very stale and low energy.

44:42 So, there's not a lot of competition. >> Mhm. >> That's the other side. The bar is pretty low. >> Okay, Brett. Again, very happy that I reached out to you. This will be one of those episodes I I I keep going back and I'm sure people listening will will keep going back as well because you public company or almost like building in public and yeah, the person behind this. This is fascinating. So, thanks Thanks a lot for sharing your story.

45:07 >> Well, I think I think that's good. I think that behind most businesses there are people who are trying to make a difference. And And that's what you see when when you see a business do it things well, it's typically, you know, people or individuals or groups of people who really are trying to make a difference. And that's certainly what we're doing at Kelly Partners. I appreciate your time. For the people that are listening, we have grown our revenue of 30% cumulative average for 20 years in a row. We have compounded our book value at 35% for 20 years.

45:44 We have a staff turnover rate that is 1/3 of the industry average. And we have a a client satisfaction rate that we use net promoter score, that I think is the highest of any accounting group at scale in the world. And so, across those, you know, our people precious close financial type of measures. that's the way we think about the business and and, you know, I'm super proud of our people that get up every day and they get out and they really do something with their lives and and and make it make a difference with people.

46:17 >> Okay. >> Appreciate your time. And as I love to say, have a great day. >> Yep. Thanks, Brett.