Guests: Pat Cleary, Daniel Ramsey
Recorded: January 5, 2020

Excerpt

You’ve gotta grow, or you’re gonna plateau! Growth can be tough, though – once you’ve made it through the endless interviews & hiring, you have to deal with the cost & administrative burden of all the paperwork that comes with each team member. So here’s a question: what if you didn’t have to?

Join us for this exciting webinar with Pat Cleary – the President and CEO of the National Association of Professional Employer Organizations (NAPEO), the national trade association for the PEO industry. PEOs provide payroll, benefits, and human resource services to small and midsize businesses nationwide.

PEO’s are part of a rapidly growing trend in outsourcing that leverages economies of scale, digital communications, and specialized labor to take the burden of managing repetitive tasks off of the company and allowing them to focus on what really matters by contracting the busywork to a PEO. To learn more, click here to find a PEO.

According to Wikipedia, “Typically, the PEO offering may include human resource consulting, safety and risk mitigation services, payroll processing, employer payroll tax filing, workers’ compensation insurance, health benefits, employers’ practice and liability insurance (EPLI), retirement vehicles (401(k)), regulatory compliance assistance, workforce management technology, and training and development.”

Before taking over at NAPEO, Cleary was senior vice president of digital public affairs at Fleishman-Hillard, focusing on helping clients drive their messages through new media channels. He’s had a wide-ranging career spanning more than 25 years in government, policy, public affairs, and communications, with areas of expertise, include human resources, health care, economics, and trade – and he’s bullish on the future of outsourcing:

“Anybody who’s gone to business school in the last 20 years has had 1 commandmant hammered into them: if its not your core business, outsource it. Security, travel, tech, HR – it’s not your core business, outsource it. We found in our last round of market research last year that the cohort that was the biggest user of PEOs were CEOs age 25 to 35 – so that generation is very, very friendly to outsourcing, and it works.” – Pat Cleary

A former chairman of the National Mediation Board and deputy assistant secretary for policy at the U.S. Department of Labor, Cleary also spent 10 years at the National Association of Manufacturers (NAM), the nation’s largest industrial trade association. He’s lectured on negotiation and dispute resolution at the University of Virginia’s Darden School of Business and the Stanford Graduate School of Business. He is the author of The Negotiation Handbook. His education includes the Program for Senior Managers in Government at Harvard’s John F. Kennedy School of Government and the Executive Development Program at Wharton. He is a member of the D.C. Bar and serves on the Corporate Advisory Board of SOME (So Others Might Eat).

“Think about it. Whatever time you’re spending on payroll, HR, benefits, vacation time, or God forbid, employment litigation – these things that were just a huge money suck. That’s all gone – because you just contracted that out. ” – Pat Cleary

Pat’s right – and think about this: the same applies to administrative, marketing, inside sales & transaction coordination busywork. Gone, poof! You just contracted it out.

Transcript

00:00:12:07 – 00:00:29:12
Daniel Ramsey
Danny Ramsey here. I’m excited. This is going to be crazy. So first interview ever with Pat Cleary. Yes. From an IPO. So if you’re if you’re.

00:00:29:12 – 00:00:31:14
Pat Cleary
Not first in in history, first.

00:00:31:14 – 00:00:32:24
Daniel Ramsey
Ever first for you to.

00:00:33:06 – 00:00:36:20
Pat Cleary
Know that I was trying to be great.

00:00:36:22 – 00:01:02:23
Daniel Ramsey
Yeah, I like I like that. I like that. Well, so today we’re going to just talk everything, PTO and your experience, this organization and why it’s a value to the members, you know, talk industry, plus just get a kind of a bird’s eye view of exactly what’s going on. And hopefully it’s super valuable. As you guys know, we provide high caliber talent to speak to growing CEOs.

00:01:03:03 – 00:01:07:08
Daniel Ramsey
We need talent. That’s what we do. Pat, let’s start with who you are.

00:01:07:08 – 00:01:27:17
Pat Cleary
MAN Oh, yeah, Coach. Simon Yeah, we. How far back start? Yeah, no. So I’ve been in Washington a really long time. Yeah, I like to say I’m part of the problem. For those of you that, you know, follow what’s going on in Washington. So I’ve been here for a long time. I’ve moved in and out of government and a bunch of different policy roles.

00:01:28:02 – 00:01:48:15
Pat Cleary
I was a federal mediator for five years, which is where the white hair came from. And then I was a lobbyist for the National Association of Manufacturers and lobbied on all their issues and you move through the ranks over there after over after about ten years. And then I got a call from a headhunter about about coming here.

00:01:48:15 – 00:01:50:05
Daniel Ramsey
So and come on over.

00:01:50:11 – 00:01:51:02
Pat Cleary
Eight years ago.

00:01:51:02 – 00:02:04:16
Daniel Ramsey
Yeah, come on over. Well, you know, something I like about your journey is the growth within you. I’m a big grow revenue guy, and we had talked earlier and you said that since you’ve been here, maybe you had doubled.

00:02:04:23 – 00:02:05:18
Pat Cleary
Yeah. Yeah.

00:02:05:19 – 00:02:16:27
Daniel Ramsey
What what do you believe is the secret sauce to that? Like why has under your leadership, have you seen your team go from 10 to 20 that revenue double? I mean, that’s a big deal for a leader. Any leader.

00:02:16:27 – 00:02:40:23
Pat Cleary
It’s really you know, it’s a growth industry and there’s there’s a lot to do. To address your question, we just in terms of the stats, we track our members, 941 and 941 is the wage statement that you that you register with the IRS you file virus every year. Yeah so the aggregate 941 of our member companies in 2012 was $60 billion.

00:02:40:25 – 00:02:42:05
Pat Cleary
60, 60 billion.

00:02:42:06 – 00:02:58:17
Daniel Ramsey
We, we, we. So I want to break that down for people who are on the because I was just with another PTO and they had said that they are going to do more than $1,000,000,000 in payroll. So are they 1/60 of the entire industry?

00:02:59:01 – 00:03:17:28
Pat Cleary
In 2012 they would have been so perfect. We were 60 billion in 2012 and in 2017 the combined 941 to remember companies was 120 billion. So they doubled over that span. Okay. So in, you know, wage inflation over that time was really probably only about 2% or so a year.

00:03:17:28 – 00:03:18:07
Daniel Ramsey
Yeah.

00:03:18:20 – 00:03:25:19
Pat Cleary
So any way you slice it, it was there’s growth with growth right now, I would say a doubling. But any way you slice it, clearly there was growth in the industry.

00:03:25:19 – 00:03:26:18
Daniel Ramsey
So the size.

00:03:26:18 – 00:03:27:02
Pat Cleary
Growth in the.

00:03:27:02 – 00:03:33:04
Daniel Ramsey
Industry, the size right now of this industry is about $120 billion in payroll.

00:03:33:13 – 00:03:49:02
Pat Cleary
It’s bigger now and that’s just our members. All our members represent probably 90 or more percent of the industry. So those are just your members. And that was 2017 numbers of were in 2019. That number is probably growing another, you know, 20, 20%.

00:03:49:05 – 00:03:58:03
Daniel Ramsey
Yeah, yeah, yeah, yeah. So what’s the overall like? I’m thinking like ADP and these other large CEOs.

00:03:58:07 – 00:04:21:02
Pat Cleary
So ADP is north of half a million employees that they’ve got in their in their PTO paychecks is a little bit behind them, trying to get, you know, several hundred thousand. So the biggest companies are pretty sizable. And then we’ve got a whole bunch of companies that are medium or medium size or smaller, and some of them are in little niche markets.

00:04:21:02 – 00:04:30:13
Pat Cleary
Some of them are in verticals, you know, so they they will just work in certain industries. We have to actually they’re just in trucking, for example.

00:04:30:20 – 00:04:31:02
Daniel Ramsey
I like.

00:04:31:02 – 00:04:35:09
Pat Cleary
That. So but they get to a specialty in that and they get to be pretty good at that.

00:04:35:09 – 00:04:55:22
Daniel Ramsey
But I was just watching the at the what was it called? It was called The Future of Work. And and it was a, you know, a vice. And so it shows a trucking company who is automating their drivers. Yeah. So I wonder for those two CEOs if they know that’s coming and what they’re going to do.

00:04:56:06 – 00:05:03:22
Pat Cleary
Yeah, yeah. So that’s that’s another podcast in there, you know, for the driving public.

00:05:04:00 – 00:05:05:01
Daniel Ramsey
Yes.

00:05:05:01 – 00:05:21:24
Pat Cleary
They want to see somebody in the cab. I agree. Right. So we have autonomous vehicles, obviously, like we’re down that road, but we’re a long way from not having people in, you know, in in cockpits, in truck cabs, etc..

00:05:21:27 – 00:05:22:04
Daniel Ramsey
Yeah, I.

00:05:22:04 – 00:05:25:26
Pat Cleary
Agree. But clearly the technology is there for for airplanes and trucks.

00:05:26:03 – 00:05:43:02
Daniel Ramsey
The technology’s there well over your next podcast. Yeah, maybe. I mean, what they’re saying is the future of how everything that we do is changing. Yeah. And in ten years when our kids, my kids, I have a little girl. So when my little girls enter the workforce, it’s not going to be the same way we did.

00:05:43:04 – 00:06:03:03
Pat Cleary
But that’s right. That’s right. But yeah. So again, this is a topic for our next podcast. So I spent a couple of years in the Labor Department’s policy office, you know, and, and then again working on a lot of these issues when I was at the National Association of Manufacturers is obviously that was the fear during the the Industrial Revolution, right.

00:06:03:03 – 00:06:30:00
Pat Cleary
And the Luddites broke the machines because they were going to, you know, take the jobs away. That’s right. And it led to the biggest explosion in the global economy that we’ve ever had seen today. Right. And the same thing is happening here. Right. And so as machines of technology replace people, productivity increases and people go into the business of making that software or selling that software or servicing or doing other jobs ancillary to that.

00:06:30:08 – 00:06:34:00
Pat Cleary
And it has always led to an explosion in jobs and the economy, and it will again.

00:06:34:04 – 00:06:35:25
Daniel Ramsey
So you’re an optimist, is what I’m hearing.

00:06:36:20 – 00:06:41:06
Pat Cleary
But it’s optimism based on data, not based on conjecture.

00:06:41:11 – 00:06:42:18
Daniel Ramsey
Right. It’s not an opinion for.

00:06:42:19 – 00:06:45:23
Pat Cleary
Oh, no, it’s it’s actually happened over history and over time.

00:06:45:27 – 00:06:47:24
Daniel Ramsey
So we started the question and then I.

00:06:47:25 – 00:06:48:24
Pat Cleary
Took it back to the CEO.

00:06:48:24 – 00:06:59:23
Daniel Ramsey
Yeah, well, I took you off this weird tangent, but I do want to understand why the this organization has doubled. Oh, yeah, yeah. Because that’s the most important question. So.

00:07:00:05 – 00:07:06:06
Pat Cleary
Yes, yes. So I think really it’s it’s me, really. I think it’s not. Okay, so here’s.

00:07:06:06 – 00:07:07:05
Daniel Ramsey
This based on data.

00:07:07:10 – 00:07:09:19
Pat Cleary
No, no, no. That’s just corporate.

00:07:10:08 – 00:07:10:25
Daniel Ramsey
Okay, good.

00:07:10:25 – 00:07:36:27
Pat Cleary
So, yeah, so here’s the thing. You know, I’m I’m a leaf on the stream, right? I’m riding along this this curve of a great and sort of dynamic industry. Yeah. And my view of this, there are a couple of things at work. First of all, I would say there are two big tailwinds. We’ve got two two big, big forces pushing us forward.

00:07:36:27 – 00:07:44:19
Pat Cleary
First is that the pace of regulation, the arc of regulation will always bend up, always, always, always.

00:07:44:20 – 00:07:46:05
Daniel Ramsey
More regulation always.

00:07:46:11 – 00:08:21:17
Pat Cleary
And when when President Trump got elected, some of our members were a little worried because, you know, one of his platforms was to reduce regulation. So some members were worried because we help small businesses comply with regulations and we help steer them through that those shoals. And, you know, I said to them at the time, this is proven to be true, that that to the extent that he has success easing the federal regulatory burden, which he has, those gaps get filled by states, localities, cities that go unfilled, fill that gap.

00:08:21:17 – 00:08:28:09
Pat Cleary
So you’re right, the regulatory curve always, always bends up. And we helped members of companies figure that out.

00:08:28:09 – 00:08:29:07
Daniel Ramsey
Yeah, right. Got it.

00:08:29:13 – 00:08:44:22
Pat Cleary
So that’s that’s tailwind. One tailwind to is, as I like to say, anybody who’s gotten out of business school, certainly in the last 20 years in this country, has had one commandment hammered into them, which is, if it’s not your core business.

00:08:44:22 – 00:08:45:10
Daniel Ramsey
Don’t do it.

00:08:45:15 – 00:09:12:00
Pat Cleary
Outsource. All right, don’t do it. Outsource. Right. Get somebody else to do it. So that’s right. Security, travel, tech. h.R. It’s not your core business outsource. So we find their last around of of market research that we did last year found that the cohort that was the biggest user of CEOs were ceos aged 25 to 35, really. So that generation very, very friendly to outsourcing.

00:09:12:00 – 00:09:15:13
Pat Cleary
And that portends great things, obviously, for CEOs and for this industry.

00:09:15:13 – 00:09:22:07
Daniel Ramsey
When you looked at that data, was that that the largest user group or just the ones that adopted it the most?

00:09:22:20 – 00:09:46:19
Pat Cleary
Both. So they were the the biggest adopters in the US in the surveys that we did and obviously in the biggest user group. So also that’s just it is they’re very friendly to outsourcing and and it works. And again, every day is a new new business or a small business. More regulations find you. And it’s just so much easier to just find a CEO to just steer you through.

00:09:46:19 – 00:09:53:28
Daniel Ramsey
All the stuff I’m sure that like the common sales pitch would be like, you run your business, let us do everything else. Yeah.

00:09:54:07 – 00:10:15:15
Pat Cleary
That’s normal, right? Absolutely. And he’ll also, you know, you know, what did you get in business to do? What did you get in business to do? Oh, I got in business to do payroll and paperwork, right? No, you didn’t. You got in business because you had a better mousetrap. You had some great software. You had, you know, mom’s muffin recipe that you wanted to get out around six months.

00:10:15:16 – 00:10:17:05
Pat Cleary
It’s it’s a grandma Muppet.

00:10:18:29 – 00:10:19:12
Daniel Ramsey
Show.

00:10:19:18 – 00:10:29:25
Pat Cleary
Mom’s muffins, a little chewy and, you know, so, you know, that’s what you got in business to do if you didn’t get the business to do this right. And we did that. Pete used it was what Pete is getting business to do.

00:10:29:27 – 00:10:40:00
Daniel Ramsey
Okay. So the headwinds and then the this acceptance of outsourcing, the tailwinds, really the regulation and the and the kind of normality now.

00:10:40:01 – 00:11:01:05
Pat Cleary
Yeah, yes. And I would say that the third factor, I would say growth, which is where Bill comes in, is awareness. It’s just awareness. Right. And so when you and when you when I first chatted, it was like, it’s funny, everybody we talked to was sort of an inside joke, you know, and it happened with me too, when the headhunter called me and I’d spent my life on the policy.

00:11:01:15 – 00:11:19:02
Pat Cleary
Yeah. Headhunter calls me the executive recruiter to say, we’re doing a search for the head of NAPO, the head of the industry. And you’re like that. I mean, my boss. I’m googling. Well, what’s a peo. Yeah, I didn’t know. Right. And so same thing when I talked to you or talk to the people, folks will say, you know, I’m really sorry.

00:11:19:02 – 00:11:28:24
Pat Cleary
I had never heard of you until now. Right. Really? That’s okay. Big hug. It’s good. Don’t worry about it. Right. And so, you know, awareness is such a big part of what we do. Is that.

00:11:28:24 – 00:11:35:15
Daniel Ramsey
A challenge? Is that the biggest challenge inside your industry? I think like letting people know that this opportunity even.

00:11:35:17 – 00:11:49:26
Pat Cleary
Absolutely. Absolutely. Because I say to the members all the time when I go, I spend a fair amount of time out, you know, visiting with our members. I see them all the time when you’re out there and it works with me to just anecdotally, I call it, you know, the guy next to me on the airplane or the gal next to me on the airplane test.

00:11:49:26 – 00:12:08:22
Pat Cleary
Right. Right. Is So what do you do? And you explain to people what you do. And when I say to folks, you know, you tell your neighbors or your friends like, this is what I do and this is what a CEO is. What is the universal reaction? The universal reaction is that’s a great idea. I never knew about that.

00:12:08:23 – 00:12:35:02
Pat Cleary
That’s a great idea. Like nobody ever says, like, oh, that doesn’t make sense. Like, who would ever buy that, right? Never. Who would ever engage a CEO? Everybody thinks immediately, this is great and it is a great idea and it’s a great value proposition for small business. So for us it’s awareness, right? Because if you make ten businesses aware that a PTO exists, these services exist and it’s kind of like now we’ve got small business saying to one another, You’re still doing this yourself.

00:12:35:07 – 00:12:43:07
Pat Cleary
Yeah, right, right. That’s good. Right, that’s good. And so that moves more businesses into this space. And it is it’s just an awareness play for us.

00:12:43:10 – 00:12:57:24
Daniel Ramsey
Is, is your is the PTO market primarily that SMB market, the small and medium size business? Or do you go to a Intel or an Amazon or some I mean, who’s the core use, you know, in the revenue world.

00:12:57:24 – 00:13:19:04
Pat Cleary
Yeah. Yeah. And it’s funny you ask that sort of an internal debate in the, in the, in our association. It’s an internal debate. Are we for small business, medium business, small business. So the data would show that the you know, the average size for a PEO client is going to be like 20, 30, 40 employees. Right. Because that’s when you hit the pain point, right?

00:13:19:04 – 00:13:24:26
Pat Cleary
You can you can handle it all yourself at your kitchen table. A certain point you can’t handle it yourself and it’s.

00:13:24:26 – 00:13:27:17
Daniel Ramsey
Deflected to your business. Absolutely. You can do it.

00:13:27:17 – 00:13:28:15
Pat Cleary
But it takes your.

00:13:28:15 – 00:13:30:25
Daniel Ramsey
Business. Exactly. So you’re not growing because you’re doing.

00:13:30:25 – 00:13:54:27
Pat Cleary
Absolutely. And so that’s the fact. So every one of our members can show you a client that they’ve got. It’s got 500 or a thousand or 3000 employees. Absolutely. Okay. Absolutely. That is true. So we are everywhere now, dear, to your point, like, you know, the Amazons or the Microsofts of the world, probably not. They’ve got your department bigger than.

00:13:55:12 – 00:13:56:27
Daniel Ramsey
They want to run it. And most of.

00:13:56:27 – 00:14:17:01
Pat Cleary
Our companies, right? Yeah. Yeah, they do it themselves. But for midsize businesses and small businesses, the PTO absolutely will add value. But in there is interesting subset because you got small businesses in the midsize business, you know, for four years. h.R. People kind of perceived us as a threat where you’re going to take my job. Oh, my gosh.

00:14:17:01 – 00:14:29:25
Pat Cleary
But now we have a really good relationship with sherm, which is the, you know, the professional side for our people. Just a fabulous organization down the street from us here with half a million or more members. They’re just a powerhouse.

00:14:29:27 – 00:14:31:10
Daniel Ramsey
We have one in our office.

00:14:31:10 – 00:14:49:15
Pat Cleary
Oh, okay. Yeah. All right. There you go. So. So we now we’ve exhibited their show for, like, the last five years to say that we’re in h.r. Person’s best friend, right? Because we do the same for an h.r. Person in the mid-sized company that we do for a small business, which is we will let you focus on strategy.

00:14:49:23 – 00:15:02:07
Pat Cleary
Right. And the bigger picture things and let us do the transactional right so we can partner with an h.r. Person and we do that in medium and larger sized companies as well. And that’s happening. That’s happening everywhere every day.

00:15:02:23 – 00:15:20:07
Daniel Ramsey
So I wanted to jump in to the value for your members because I think that’s a really important thing to like drive home. If if a member a PTO isn’t a member, why should they? And then if they are a member, what’s the most value that they drive out.

00:15:20:07 – 00:15:32:19
Pat Cleary
Of working with this? Yeah, that’s a great question. The big thing for me is it’s you know, I like to say we have the best PTO magazine in the world. In the world.

00:15:32:24 – 00:15:33:07
Daniel Ramsey
I love it.

00:15:33:27 – 00:15:52:20
Pat Cleary
Okay. It’s the only one. Okay. But it’s the best one in the world. Yes. Right. That’s the thing. So again, I go back to Sherm and some enormously high percentage of our members, I think it was like 80% in the last survey have some level of Sherm certification. Right. So that and that’s great and we encourage that. Yep.

00:15:53:17 – 00:15:58:15
Pat Cleary
But like the specific PTO stuff, you’re you’re only going to get it here.

00:15:58:17 – 00:16:02:00
Daniel Ramsey
Well, and if you’re in here and if you’re in multiple states.

00:16:02:04 – 00:16:03:02
Pat Cleary
Oh, absolutely.

00:16:03:02 – 00:16:04:21
Daniel Ramsey
Right. There’s a level of complexity.

00:16:04:21 – 00:16:26:13
Pat Cleary
There’s just no doubt. So so that’s the second thing. So the first thing is you’ve got PTO, specific education, PTO, specific information, you know, go to sort of network with one another, etc., which they do. Yeah. But then the other piece of it is we have a regulatory database. So it’s, there’s one member that we know who is our former chairman who operates in only one state.

00:16:26:20 – 00:16:27:23
Daniel Ramsey
Hawaii. Hawaii. Yeah.

00:16:28:18 – 00:16:47:01
Pat Cleary
Yeah. He’s the only member that’s in one state only. Right. Because if you start PTO in California tomorrow and you’re going to operate in California, right? You’ve got a client that’s great. And you get two or three or four or five clients. That’s great. And then a week later, one of the clients calls you Daniel. We got somebody who’s going in Oregon.

00:16:47:01 – 00:17:03:04
Pat Cleary
We’re putting some salespeople in Oregon. Right. Okay. Hey, you know, we could open up a branch in Nevada. Yeah, you’re like, oh, boy. Then, hey, we got somebody over in Arizona. You’re like, Oh, so you don’t drive, but they drive. Sure. So now you’re doing business in California. Nevada, Oregon.

00:17:03:12 – 00:17:05:04
Daniel Ramsey
Arizona, wherever they are now.

00:17:05:09 – 00:17:24:28
Pat Cleary
And then they get bigger, your clients get bigger and they expand. And even our smallest CEOs are in probably 15 or 20 states. Right. So every one of those states has different rules for CEOs, and you better know what those are. And if you’re not a member here, you’re really you know, you’re operating at your own peril out there.

00:17:24:28 – 00:17:41:13
Pat Cleary
I hope you get it right. So a regulatory database will tell you that all of a sudden you’re now in South Carolina. You can go in there all the database is okay, I better do this here. The people I need to talk to, I need to register. I don’t want and go through that. And then just a specific PTO, specific education.

00:17:41:13 – 00:17:41:21
Pat Cleary
Right?

00:17:41:25 – 00:17:46:00
Daniel Ramsey
So the operate how to operate. Yes. Within the different states. Yes.

00:17:46:15 – 00:18:00:06
Pat Cleary
Okay. Yep. And also, we do all the best practices, but just targeted at a right, not just because we’re such a unique creature in law and regulation and in practice that you’re only going to get that information.

00:18:00:09 – 00:18:07:16
Daniel Ramsey
Any anybody else have a database like that? Is that does that exist at the h.r. World or any other? No.

00:18:07:20 – 00:18:14:04
Pat Cleary
No, because I don’t think anybody really has the the will to put that together.

00:18:14:04 – 00:18:15:05
Daniel Ramsey
Because it’s a big deal. It’s a.

00:18:15:05 – 00:18:24:11
Pat Cleary
Big deal. It’s hard. And so for us, that’s probably one of the most popular or trafficked areas on our website.

00:18:24:19 – 00:18:25:00
Daniel Ramsey
Okay.

00:18:25:16 – 00:18:29:02
Pat Cleary
But the most popular area on our website is the find a PTO.

00:18:30:00 – 00:18:30:25
Daniel Ramsey
Fine, the PTA.

00:18:30:29 – 00:18:56:00
Pat Cleary
So just maybe, oh, dawgs slash, find a PTO, all one word, maybe. Oh, Dawgs find the PTO. And then we we run a lot of online ads, we do a lot of marketing targeted at small, medium sized businesses. Okay. And all those ads steer you to find a PTO. And we’ve got people coming on every day, thousands of folks come on, hit that link and search for PTO in their state area.

00:18:56:09 – 00:18:58:22
Pat Cleary
And then those folks get that makes them.

00:18:58:28 – 00:19:00:12
Daniel Ramsey
Referrals to the.

00:19:00:17 – 00:19:02:08
Pat Cleary
Members. And that’s that’s a great thing.

00:19:02:08 – 00:19:07:01
Daniel Ramsey
We’re happy for them. Do you guys track how much revenue you’ve driven to your members through that?

00:19:07:13 – 00:19:17:14
Pat Cleary
That’s funny. No, but we have the aggregate numbers, right? You know what I mean? So we have the aggregate numbers I just mentioned to you in terms of tracking the industry right. Last number of years.

00:19:17:14 – 00:19:18:21
Daniel Ramsey
So you just know it’s growing.

00:19:19:09 – 00:19:47:14
Pat Cleary
And so so actually it’s interesting is I assert I just heard that it’s all right. No, but then maybe I would make the argument. So, you know, our marketing budget has increased tenfold in the last six years, right? Sure. So in that same time, the industry’s doubled in size. So is it coincidence or causation or correlation? Yeah, I would say it sure is a funny coincidence.

00:19:48:00 – 00:20:11:03
Pat Cleary
I had nothing to do with it. Bad, so funny coincidence. I think there’s causation there, but the more money we spend, the more money, the more business our members get. And and that’s great. That’s what we’re here to do. Right. And, you know, so our our dues are based on their 940 ones. Right, right. So, you know, the bigger they get then, you know, their dues will increase here.

00:20:11:09 – 00:20:12:23
Pat Cleary
So everybody benefits.

00:20:13:10 – 00:20:20:21
Daniel Ramsey
It’s interesting. How does how do you guys if if the dues are based on the 941 as a percentage of their kind of employed.

00:20:21:20 – 00:20:22:05
Pat Cleary
Yeah, yeah.

00:20:22:06 – 00:20:30:19
Daniel Ramsey
Yeah, right. Yeah. I wonder I wonder how you could track the return on investment for that because that would be, that would be a yeah yeah.

00:20:30:27 – 00:20:42:13
Pat Cleary
Yeah. Well it’s so funny is we there are a few poles of significant size, only a couple who aren’t members here and.

00:20:42:13 – 00:20:43:13
Daniel Ramsey
That’s why we’re doing this video.

00:20:43:13 – 00:20:59:26
Pat Cleary
Right? That’s right. That’s right. Now they need to be members and I always say to them, because, you know, they come to our conferences and I’ll say to them, look around the room, all right. All your competitors are here. All the biggest poser here, all the most successful CEOs are here.

00:20:59:29 – 00:21:00:08
Daniel Ramsey
Right.

00:21:00:21 – 00:21:22:13
Pat Cleary
What do you know that they don’t know, but what do you know about membership that they don’t know? Because they’re they all join and they send all their people. They come to all our stuff and they subscribe to all our stuff. I just saw a number yesterday. We’ve added a couple of thousand people to our rolls, people who are getting information from us just in the last two years.

00:21:22:18 – 00:21:42:01
Pat Cleary
Wow. So it’s really significant. So these companies join they tell all their people, hey, get in the car and log on, get all their stuff. We’ve got a thing called PTO University. That’s just a series of videos, just a couple three minute videos that just say, this is what this is about. This is what this is about. It covers all the topics in our industry, right?

00:21:42:01 – 00:21:50:22
Pat Cleary
And so for people who are new to one of our member companies or new to the industry, you spend an hour on PTO University, you’re going to be up to speed.

00:21:51:08 – 00:22:07:00
Daniel Ramsey
You know, it’s weird. So I’m I’m relatively new. I’ve only been serving this industry for two ish years. We’re going on our third year next month, actually. And so what I found at your conference, because I was first time attendee, I’m like soaking it all in.

00:22:07:00 – 00:22:07:16
Pat Cleary
Yeah I’ve good.

00:22:07:17 – 00:22:09:25
Daniel Ramsey
Everybody’s booth hi. What do you do? My name is Daniel.

00:22:09:28 – 00:22:12:25
Pat Cleary
Yeah, there’s good energy there isn’t there, at the conference. Yeah.

00:22:12:25 – 00:22:31:16
Daniel Ramsey
Yeah, it’s and you know it’s wild is everybody was super friendly, which is unusual because I go to a lot of industry events. Right. So it’s unusual to walk up to a booth and say, Hi, my name is Daniel, tell me what you do and then have them just give you everything. And then to realize that their competitor is right next door doing the exact same thing.

00:22:31:16 – 00:22:49:00
Pat Cleary
Unbelievably collaborative industry. It is unbelievably collaborative. You have people who head to head competitors and some people call, I’m a big problem with this. Like, let me help you with that. Here’s what’s going on. Head to head competitors increases the level of collaboration in this industry that I’ve never seen before. And it’s great. It’s a big cocoon.

00:22:49:05 – 00:23:22:13
Daniel Ramsey
It’s cool. Well, my question, though, is how what’s I mean, based on there’s not very many people who have a huge debt of what is a p you meaning every state, you have members in every industry, you have members and you collect the data and you do the marketing and you’re doing the studies, which I found fascinating. But I want to know, for the people who are listening right now, the question is, and I want you to speak directly to them, how does a CEO double their business if if they’re listening right now?

00:23:22:13 – 00:23:27:15
Daniel Ramsey
Yeah. And it’s the only thing in my I ask every single person that comes to me.

00:23:27:15 – 00:23:27:23
Pat Cleary
Yeah.

00:23:28:07 – 00:23:42:00
Daniel Ramsey
If you and I were sitting down and two years we’re we’re here together again. Yeah. What do we need to do today to double your business? Yeah. And in my world, it’s always talent, adding people and and growing it. But I’m curious what your answer would be.

00:23:42:00 – 00:24:03:04
Pat Cleary
Yeah, it’s so great. And so we did. We’ve done two rounds of focus groups now. We just did a couple in your town and in Sacramento and Austin, Texas and Indianapolis. And then we did around last year in three other cities. So this is so great. So we’ve done all this research and it’s all on our Web site, npr.org.

00:24:03:15 – 00:24:05:22
Daniel Ramsey
And it’s right there.

00:24:06:11 – 00:24:25:23
Pat Cleary
Right here. You can you can’t miss us in HBO dot org. So we’ve done all this research. You know, we go we we do focus groups with small businesses to say what are your hot buttons? And what’s so interesting to me, I’ll get I’ll get to your answer because but this is this gives you some context. And we started focus groups seven years ago.

00:24:25:24 – 00:24:51:18
Pat Cleary
Yep. And we had all these high minded things we were trying to get through. We brought all these small businesses together and we were so surprised. The biggest issue, because we’re like, you could do all this stuff and wonderful stuff. Biggest issue, survival. Yeah, right. We’re like, wow, this is unbelievable. Growth, turnover. Those are the biggest issues. So then we have an economist, she’s from Princeton.

00:24:51:18 – 00:25:11:05
Pat Cleary
She taught at Georgetown. She’s got enormous integrity. She’s not going to sign or named anything that isn’t true and valid and accurate. And we hold our breath. She goes out and she does research with PEO clients and compares them to non PEO clients and we say here’s what they care about, they care about survival, growth, turn over, go.

00:25:12:01 – 00:25:32:27
Pat Cleary
And we hold our breath and we wait. And she takes months and months and collects all this data and calls us back and so far says, I’ve got good news and why wouldn’t she? It makes perfect, intuitive sense. So your survival rate is double with a right growth rate, 14% higher. Your turnover rate is lower with a PTO, right?

00:25:32:27 – 00:25:52:22
Pat Cleary
So we did that. We went back to them to talk. They want to know how does this impact the employees, employees, their employee satisfaction? Higher. They have more faith in their company. They trust the company more. If you use a PTO as compared to businesses that don’t use a PTO. Yeah. And then we went to your question. I’ll get to your question about about know revenue and growth.

00:25:52:25 – 00:26:12:27
Pat Cleary
Yeah. Yeah. Well, will you grow more your revenue grow more and and then those are absolute. Yes. So we go back to these focus groups. Yep. This data. Yep. And Daniel, I’ll take it literally, literally too good to be true. So we go to the focus groups. We say here are some data points on posted. You got it up.

00:26:13:09 – 00:26:40:00
Pat Cleary
And they look at it. That visible skepticism right there like this is this is bull. It’s not it’s data. And we’ve got we’ve good white papers with all the data and the back up is done on our website. So we’re at this one focus group in Cincinnati last year. Yeah. And you know, you sit there looking through the glass and there’s this guy there and I just remember him because I’m a musician and he look like John Prine, who’s just my favorite.

00:26:40:00 – 00:27:01:20
Pat Cleary
John Prine is a musician, songwriter is great. He just looked like John Prine. I looked at him through the window and he said, Here’s this and your revenue will double. You know, typically, Pete, your client’s revenues doubled and he was this is bull. This is bull. And I’m looking at it and he stops and other people start talking and talking.

00:27:01:20 – 00:27:26:08
Pat Cleary
And I just kept watching him. You see him sort of think a little bit, you know, and then he raised his hand again. He goes, You know what? I take back what I said, because if I can take people off of non-revenue generating stuff and put them into revenue generating stuff, I’ll bet my brothers I’m going to grow revenues about.

00:27:26:10 – 00:27:47:04
Pat Cleary
I totally get it. Yeah. So it took him a minute. Yeah. But he’s like, no, this is this is exactly right. This is right. So it’s funny, as we go out there and carry the message to people, the absolute instant reaction to all the data we’ve got is a little overwhelming, A and B skepticism. Right. But think about it.

00:27:47:14 – 00:27:53:19
Pat Cleary
Think about like whatever time you’re spending on payroll, on, you know, all the.

00:27:54:05 – 00:27:56:01
Daniel Ramsey
Things that come to your door, just your.

00:27:56:04 – 00:28:15:14
Pat Cleary
Stuff that comes through your doorbell, somebody has got this issue or that issue is like employment litigation, God forbid, like these things that are just a huge money suck or any of these things that happen, all that like gone. You, you just you just contracted that out to somebody right now. What do you do? How are sales looking?

00:28:15:22 – 00:28:37:21
Pat Cleary
Who do I need to go? Go see? Is there a new customer I need to go visit? Hey, there’s some efficiencies we can do. And I get I come out of manufacturing world in production or, you know, in the white collar office or the service we can do is get new to improve our service. It’s sort of that’s your focus and all that gray matter and all that time that was spent on the other stuff just got taken off your plate, right?

00:28:37:23 – 00:28:42:03
Pat Cleary
So now you focus on why you got in business, right? The reason you got in business, you focus on.

00:28:42:03 – 00:28:46:12
Daniel Ramsey
That and that caused that by itself causes growth is. You’re absolutely.

00:28:46:12 – 00:29:04:04
Pat Cleary
Right. Absolutely. And and also the big issue these days in terms of finding the best talent. Right. If you’re a small business now, you know what? If you were the people, you have a suite of benefits, right? Right. So you’re competing against person. Cross Street doesn’t have a PPO. It doesn’t have a suite of benefits. Right. You’re going to they’re going to come work for you.

00:29:04:09 – 00:29:07:17
Daniel Ramsey
It’s a strong value proposition for employers.

00:29:07:17 – 00:29:08:18
Pat Cleary
Absolutely right.

00:29:08:20 – 00:29:09:28
Daniel Ramsey
Right now, back to my.

00:29:09:28 – 00:29:11:26
Pat Cleary
Original question for employees. Yeah, go ahead.

00:29:12:04 – 00:29:19:26
Daniel Ramsey
My original question is, how does a CEO double life? What’s the what I mean, if you’re talking to you because you guys have a appeal.

00:29:19:26 – 00:29:23:06
Pat Cleary
I was thinking about your clients on how your clients do it.

00:29:23:06 – 00:29:39:06
Daniel Ramsey
Oh, I love that. I love where we went because I think it gives a lot of context because when I talk to pillows, I ask them what their value proposition is. And I and we’re like, well, we’ll do your payroll now and or, you know, or like, well, you shouldn’t deal with all this minutia. We can do it better.

00:29:39:07 – 00:29:53:11
Daniel Ramsey
Yeah. And I think there’s some validity what you just said. And I think there’s some if if I’m listening and I’m PTO, I’m taking what Pat just said, breaking it down and then pushing it down to every person in my company. Yeah. So they get it clear.

00:29:53:12 – 00:30:17:12
Pat Cleary
Oh, yeah. So if you’re a PTO, maybe about another part. But this is important. If you’re pow, if you’re a Navy member, Navy Dawgs slash market research. Yes. So it has all this data in it. Get it, send that link to your salespeople now like send it to them now because that stuff they need to be looking at because it would cost your company what it cost us to do that research because you’re a member, you get it for free.

00:30:17:12 – 00:30:17:27
Daniel Ramsey
Is it giving.

00:30:17:27 – 00:30:18:19
Pat Cleary
Your salespeople.

00:30:18:19 – 00:30:20:16
Daniel Ramsey
Millions, dollars, hundreds of thousands.

00:30:20:19 – 00:30:22:17
Pat Cleary
Hundreds of thousands of dollars to get that stuff done?

00:30:22:22 – 00:30:23:20
Daniel Ramsey
And it’s a big deal.

00:30:23:24 – 00:30:25:12
Pat Cleary
It’s a big deal. And it’s free to our members.

00:30:25:20 – 00:30:42:14
Daniel Ramsey
Well, what’s interesting is I’ve seen your ads because, I mean, you know, I don’t come I don’t come to these things unless I can see digital. I know that there’s a digital footprint. And so everything that you’re talking about is clearly in Google and Facebook. Yeah. Yeah. Why you should use the PTO.

00:30:42:14 – 00:31:09:20
Pat Cleary
Yeah, yeah. And they’re using the messages that we know from small businesses that are top of mind, right, period. So then that gets to your question as a CEO, how you double? To me, it’s pretty simple in that you double by getting this stuff, getting this data, give it to your salespeople and just make sure everybody in your town, in your county and in your state knows that you’re there and knows what you do.

00:31:10:02 – 00:31:30:22
Pat Cleary
And you can target the ads to small business like we do. Yep. We’re in the middle right now of what we call the October push. So, you know, we can’t boil the ocean. We’ve asked our members for the month of October, do something, do something. So radio ad, TV ad, you know, banner ads, online something. Make a speech at the local chamber or local NFIB.

00:31:30:27 – 00:31:49:11
Pat Cleary
Yeah, and so they’re doing it. People are stepping up and it’s good. It’s causing some ripples out there. Right. And even just, you know, we’ve got a very short, like 90 minute explainer video. Yep. And 90 minute, 90 seconds science. 90 minutes, very short, 90 seconds. But it’s great you click on that and that that’s what it feels like.

00:31:49:11 – 00:31:51:03
Pat Cleary
Oh, I get that sort of without.

00:31:51:03 – 00:31:56:17
Daniel Ramsey
Doubt you can actually understand the industry. Yeah. And it’s simple for some bees to absolutely gather.

00:31:56:17 – 00:31:57:13
Pat Cleary
Yeah, absolutely.

00:31:57:14 – 00:32:06:04
Daniel Ramsey
But your answer is get the research, clear up your value proposition and just get that message out to your market.

00:32:06:04 – 00:32:31:27
Pat Cleary
Yeah, because it’s awareness. It really is is awareness. And it’s funny, I was just talking to a member last night about this that one of our inspirational speakers at our conference two years ago was talking to us about this. And we’re like, you know, you how do we grow the industry? And one of our members is in Kansas and I forget the exact numbers, but he says, you know, he’s got a few hundred clients.

00:32:31:27 – 00:32:39:06
Pat Cleary
Yep. And there are like a few thousand, like eight or 9000 or 10,000 small businesses in Kansas, right?

00:32:39:14 – 00:32:39:26
Daniel Ramsey
Yeah.

00:32:39:26 – 00:33:02:28
Pat Cleary
His point was, I don’t have to leave Kansas. Right. I got another, you know, 9700 companies I can sign up, you know, as clients without leaving the state lines. Right. So I think that’s really it for, you know, for pros is the resources are here. It is all about awareness because once people know that you’re there and know that a appeal exists, yeah, it’s like doing your own taxes.

00:33:02:28 – 00:33:24:29
Pat Cleary
Like you still do your own taxes. No, somebody else do it. Right, of course. You know, so it’s that and so it’s awareness and you’ve got to be out there pounding away every day, having clients, you know, make referrals for you, etc., etc., etc. and just being out there and being visible, let people know what a PTO is because again, the universal reaction when people find out what the pillow is, is not like, Oh, that’s a terrible idea.

00:33:24:29 – 00:33:26:26
Pat Cleary
It’s like, where do I sign up? Yeah.

00:33:27:21 – 00:33:45:18
Daniel Ramsey
How so? This Kansas. I’m going to focus on that because part of what I do is I build our database, you know, finding out who our targets are, segregating them to like these people. We want to work with, these people we would work with, and we don’t want to work with these guys. You know, we put them into those three categories.

00:33:46:02 – 00:33:55:16
Daniel Ramsey
How would a CEO in Kansas figure out who those 10,000 business owners are and then be able to put those into a segment like what’s the what are the steps?

00:33:55:16 – 00:34:11:18
Pat Cleary
Yeah, it’s interesting. There are a lot of different ways to go about. I know we’ve got a member in Ohio who just works. I think I think the state workers comp folks because you have to buy workers comp through the state of Ohio as it happens, I think they keep a list of all small businesses. Right. So they use them to market to them.

00:34:11:18 – 00:34:35:07
Pat Cleary
So each state, it’s different. But I think people either go to the, you know, the state agency or they purchase lists from various vendors right to target. And again, typically, our members do target small medium sized businesses. Right. Right. And then you might land a well. But I think basically that’s going to be the sweet spot. And that that’s at least anecdotally from talking to our members, that’s really what they what they target.

00:34:35:14 – 00:34:58:27
Pat Cleary
And the two that they do, which is really interesting. Danielle is a bunch of our members. They how do I put this they they become a resource, right? They don’t say they’re smart. They just are smart. And so there’s one I can think of in new york. One in massachusetts, one in massachusetts. Has a blog, genesis, h.r. They have a blog.

00:34:59:03 – 00:35:07:20
Pat Cleary
It’s just really helpful. It’s really helpful. It’s like, hey, don’t forget these these new requirements coming online next month and bup bup bup. It’s just, it’s not like.

00:35:07:21 – 00:35:10:00
Daniel Ramsey
Hey, it’s content. He’s creating content.

00:35:10:00 – 00:35:27:15
Pat Cleary
How can you do it? It’s like it’s just I’m going to be a resource. And so it’s so good because they are smart. I mean, you know, our members are really smart. They’re experts at this stuff. Right. And so a lot of them or they go they speak at the local chamber music and or the local NFIB is they do seminars like, hey, just be aware, right?

00:35:27:17 – 00:35:48:02
Pat Cleary
Here’s what’s going on. Here are some here are some, you know, some traps you can fall into and be careful of this stuff. And that’s a great business generator for people just going out there. So it’s not you don’t have your handout all the time, but you’re just a resource. And people realize over time, you know what, those folks at Genesis are so good on this stuff and they just hire right at a certain point.

00:35:48:06 – 00:36:02:25
Pat Cleary
And so we’ve got a bunch of our members who do that, who operate in their own communities, or they’ll have a blog or other social media that provides information and insight that just shows how smart they are. And ultimately, they’re a resource for these, you know, the small businesses will find them.

00:36:03:08 – 00:36:25:14
Daniel Ramsey
You know, I was curious, most of the CEOs that I’ve talked to, their biggest challenge is finding great salespeople. I’m like, yeah, the industry is tiny. Yeah, they’re yeah, I don’t know, 800, 900 years in the world. Right. And they just kind of trade around. Yeah. Or it’s the founder who’s doing the majority of the sale or partner.

00:36:25:15 – 00:36:34:23
Daniel Ramsey
Yep. What’s your path to getting somebody who doesn’t have experience up to speed as a sales person, you know, and what’s that look like?

00:36:34:23 – 00:36:52:17
Pat Cleary
Yeah, that’s that’s a great question. We have sort of the guru of sales, Clay Kelley, who’s one of our board members, and he operates out of out of Texas. And he’s one of the premier sales consultants in the industry. So this is what he does for a living. But, you know, you’ve got I think the answer is all over the board.

00:36:52:17 – 00:37:19:09
Pat Cleary
You have a bunch of people who work through brokers, networks. They have brokers. So for them, you have some who only will hire people who come from the industry. And there are companies who say, no, I don’t want people to come from the industry. I want good salespeople and we’ll teach them about the industry. Right. So you’ve got different schools of thought out there, but the idea obviously is to get good salespeople who can get through the door and explain the value proposition.

00:37:19:09 – 00:37:21:25
Daniel Ramsey
But those are the three major channels, the broker.

00:37:21:25 – 00:37:30:26
Pat Cleary
Brokers, people inside the industry and people outside the industry. And again, there are companies who don’t hire salespeople from inside the industry. Right. It’s like we’re just going to we’re going to teach it.

00:37:30:26 – 00:37:37:19
Daniel Ramsey
We’re going to train it. Right? We’re going to train a lot. What’s that learning curve? If if somebody like is it a one year ramp up? Is a three year ramp?

00:37:37:19 – 00:37:38:16
Pat Cleary
That’s a good question.

00:37:38:16 – 00:37:39:20
Daniel Ramsey
How long did it take you?

00:37:39:22 – 00:37:41:17
Pat Cleary
Oh, I’m I’ve been here eight years. I’m still at it.

00:37:41:18 – 00:37:43:19
Daniel Ramsey
Yeah. But yeah.

00:37:43:24 – 00:38:02:01
Pat Cleary
I think the basic building blocks that can probably learn, you know, you know, pretty quickly. Yeah. Yeah. And then from there, the nuances and the technicalities probably take a whole lot longer to learn. But typically, you know, I actually just talk to one of our members in Florida. It was a very new salesperson, but they’re being mentored by a more senior person.

00:38:02:02 – 00:38:02:09
Daniel Ramsey
Right.

00:38:02:11 – 00:38:08:23
Pat Cleary
Who you know, and and helped them steer through their first sale and do stuff that way. So I think that’s probably more Common Core.

00:38:09:12 – 00:38:11:19
Daniel Ramsey
All right. So we’ve covered everything this. And I think.

00:38:11:19 – 00:38:12:01
Pat Cleary
We have.

00:38:12:01 – 00:38:13:21
Daniel Ramsey
I mean, it’s crazy how.

00:38:13:21 – 00:38:14:19
Pat Cleary
After the revolution.

00:38:14:19 – 00:38:27:07
Daniel Ramsey
And when we really cover that, what what would somebody do if they wanted to go deeper or learn more or understand it, know in an in-depth way of joining, okay, you really taking advantage.

00:38:27:08 – 00:38:50:29
Pat Cleary
Again, our website, npr.org. There’s a link how to join. There’s a link with all our resources on it. You know, I am a believer in putting a lot of stuff outside the fence. Right. So it’s available for the public. Yeah. So there’s a lot of stuff out there that is publicly available, but like our research, that’s expensive. Our members pay for that, you know, so you’ve got to be a member to get that right.

00:38:50:29 – 00:38:55:28
Pat Cleary
That’s something I’m not going to give away for free because I think that kind of devalues our members.

00:38:56:03 – 00:38:56:22
Daniel Ramsey
Who are paying.

00:38:57:03 – 00:39:13:02
Pat Cleary
Their contribution, literally their monetary and other contributions. So but if you come to the website, even as a non member, there’s a lot of stuff there. The regulatory database obviously is just for members, right? But there’s a lot of resources there. You can sort of browse around, look around and see what you know, yeah, you know, what’s there for you.

00:39:13:10 – 00:39:33:06
Pat Cleary
But again, as a P, I can’t imagine. It’s funny, one of our industry lawyers a couple of years ago after Obamacare passed, I was I was with him in Florida and he came up to a large nonmember at the time, who’s since joined and said to him, Why on earth would you want to go through this on your own?

00:39:33:16 – 00:39:52:13
Pat Cleary
Like figuring out Obamacare and its implications for people is like, why and how would you go through this on your own? But these guys have all the resources. They’ve done all the right thinking, all the working on this, right? So it’s good. And also, I think for larger pros, there aren’t very many large people, those that aren’t members of ours.

00:39:52:13 – 00:40:17:20
Pat Cleary
Right. And I literally can name less than one hand, but also like the bigger you get for your peers and for the private equity community, we’re attracting this space. This industry is attracting a lot of private equity, interest and money or the venture capital industry. You had people, folks, you know, they wonder, why aren’t you a member of your trade association?

00:40:17:20 – 00:40:34:04
Pat Cleary
Like everybody, all the bull, the big whales are in like everybody’s in. Right? They see value. They’re part of the League of Nations. You just want to be an outlier. It’s just not a good look. Additionally, you know, if we provided no value, you’d still want to be a member because it’s a bad look to be the outlier.

00:40:34:08 – 00:40:49:06
Pat Cleary
Yeah, right. And but we do provide a lot of value to people who are in there and folks who are in for the life. Me, I don’t know how they, how they steer through it. Again, we’ve got a couple who’ve gone in and out, in and out and the folks who go out, you know, because the CEO says we’re out.

00:40:49:09 – 00:41:08:24
Pat Cleary
We hear from everybody else in the company throughout the year. Every body else who’s on our lists for state government affairs, federal government affairs, regulatory updates, the marketing, communications, everything we hear from everybody else in the company throughout the year, like, you know, why are we members? Why can’t we access this stuff? And I told my CEO, we really need to join, really.

00:41:08:24 – 00:41:14:22
Pat Cleary
Just keep working on it. Keep working on it. It’s not that big a problem for us because we have just a couple outliers.

00:41:14:26 – 00:41:15:20
Daniel Ramsey
What’s the future?

00:41:15:27 – 00:41:16:16
Pat Cleary
What’s likely?

00:41:16:23 – 00:41:24:05
Daniel Ramsey
What’s the future like? What? What should members in this industry look forward to from an IPO over the.

00:41:24:06 – 00:41:51:02
Pat Cleary
Yeah, you know, it’s it’s it’s funny, Daniel as a as, you know as bad as this answer is about to be more of the same more the same. Right. And, and we have, we have an outside group that’s helping us with our marketing and they’re great. We’ve got LG and it’s a firm in DC, highly recommended by the US Chamber that I’m very active in, and they just done phenomenal work and at the conference they rolled out a bunch of stuff, great work and.

00:41:51:02 – 00:42:11:01
Pat Cleary
So we had a call with them last week with Terry Carruthers, who’s our head of marketing. Yeah, and they’re great and they’re creative and they’re brilliant. Yep. And they said, Hey, we think next year we need to do step five and step six and step seven and eight and nine and ten. And I said, You know what we need to do step one over and over and over again.

00:42:11:06 – 00:42:24:12
Pat Cleary
Step one is awareness. Yeah, right. And their ideas were great. And I said, let’s put those aside because we’ll use those someday. Yeah, but they were fancier. They were once everybody knows what a pillow is, let’s do this stuff and that.

00:42:24:12 – 00:42:25:22
Daniel Ramsey
But not everybody knows.

00:42:25:22 – 00:42:47:08
Pat Cleary
Yeah, they were far away and we’ve, you know, for the it’s for the 10 to 99 market in 10 to 99 employees. We’ve got 15% of that market, right? 50%. So we’ve got a long way to go just in that market. Yeah. So my view is more of the same. Like we will continue to pound and pound and pound and pound away and it is just anecdotal.

00:42:47:08 – 00:43:08:02
Pat Cleary
Like we ordered, we interviewed some audit firms last week. We have an audit firm and periodically you have to go through and and you know in you know audition some others and we had four or five audit firms come through last week. It’s just anecdotal in every one and they work mostly in the SMB space. Every one of them, said the apologetic, Gee, I didn’t know what a video was.

00:43:08:07 – 00:43:27:24
Pat Cleary
That’s a big, big hug. And they said, you know, a couple of years ago. But they said, now a bunch of our clients are using PR, right? So unsolicited, every one of the firms that came in said, you know what, more my clients are using PTO, right? Yeah. The gal next to me on the airplane test, more and more people are saying, Oh, I know the PTO is sure it’s good.

00:43:27:28 – 00:43:46:27
Pat Cleary
So the awareness is building. So for us we are just going to keep pounding and pounding and pounding away on this is what a PO is and this is what it does right. And if you want to find one, go to enable dot org slash find a PTO and people are clicking by the thousands, by the millions on that link and that’s good.

00:43:46:27 – 00:44:05:09
Pat Cleary
And some percentage of those are converting into PTO clients, right? Some are thinking about it will convert clients down the road. But for us, it’s going to be awareness. You know, as far as I can see, frankly, you know, I would love to tell you that I can see a year or two from now where everyone’s using the PTO.

00:44:05:09 – 00:44:25:04
Pat Cleary
We’re going to some other message. Right. But now that’s it’s for the foreseeable future, we are going to just continue to pound and pound away on here’s what here’s what a PTO is. Yeah, here’s what we do. Right. Well, the other thing I should mention, too, before we leave, so the of all the messages so funny of all the messages for the focus groups.

00:44:25:05 – 00:44:51:27
Pat Cleary
Yeah. We put all the data, all the stuff they believe, all that stuff, which again, it’s factual, it’s data. The message that they all glommed onto is just just as we were doing all this empirical work with our economist, I said to her, Hey, well, you’re under the hood and interviewing all these PEO clients. I’d just be interested, know you interested to know how many of them would recommend a PTO to another small business one.

00:44:51:29 – 00:45:16:00
Pat Cleary
What’s what’s the satisfaction rate? Like 30%. 60%? Like how if you’re a poor client, would you recommend a component? Another small business, 98%. So great. Which to me was a better number than 100% because 100 sounds like BS. 98 is real. That’s a real number. And we did it again and it came up 98% again. And so in the focus groups that now it’s not funny that night.

00:45:16:00 – 00:45:27:10
Pat Cleary
So the small businesses are like, yeah, my revenue will increase, that’s BS and there’s that. Yes, we don’t believe that we’re going to grow. You know, all the stuff that they were skeptical about when they saw that, they said ha that’s good.

00:45:27:19 – 00:45:38:11
Daniel Ramsey
It’s because social proof matters. Yes. Yes. And it’s like if a friend tells me or somebody right. In business like me. Yeah, it’s it’s ridiculous. Right. How important that that’s exactly right.

00:45:38:12 – 00:45:42:00
Pat Cleary
And so it was so interesting to me that that was the big flag for them.

00:45:42:02 – 00:45:45:03
Daniel Ramsey
It’s a five star review. Absolutely right. Everybody wants to.

00:45:45:04 – 00:46:01:05
Pat Cleary
Buy from a peer, from a five star review, from somebody you trust. Right. That’s interesting. Interesting. And so that data’s out there and that’s great. And it’s true. It has the additional benefit of being true that 98% of current PTO customers would recommend one to another small business. That’s terrific.

00:46:01:08 – 00:46:04:15
Daniel Ramsey
I might drop right there. Boom, Pat.

00:46:04:16 – 00:46:09:29
Pat Cleary
All right, buddy. Thank you. It’s good that, folks, thanks to.