Podcast Episode 45

Tech Founders, Know Thyself: Hutton Henry on Personal Strengths and Funding Success

In this engaging and insightful podcast episode, Ryan Davies hosts a conversation with Hutton Henry, discussing the importance of self-awareness in achieving funding success. The discussion touches upon various topics, from the significance of knowing oneself to the challenges faced by entrepreneurs in the fundraising process. Hutton shares valuable insights drawn from his extensive experience, emphasizing the need for founders to recognize their strengths, address areas for growth, and refine their storytelling abilities to capture investor interest effectively. Throughout the conversation, Hutton’s passion for empowering entrepreneurs shines through, offering practical advice and highlighting the potential of embracing one’s journey in the tech industry.

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Ryan Davies: Welcome, everyone, to the Tech Business Roundtable podcast show. This is a podcast show dedicated to shining a spotlight on tech innovators, entrepreneurs, founders, and the compelling narratives behind the movements they’ve established. I’m your host, Ryan Davies, and I’m hosting today’s discussion on Tech Founders, Know Thyself: Hutton Henry on Personal Strengths and Funding Success with Hutton Henry. Hutton, Thanks so, so much for being here today.

Hutton: Hi, Ryan, thank you for having me. I’m really happy to be here.

Ryan Davies:  I am super excited for this one. We already, in our pre conversation, have hit it off very well. The energy’s nice and high. And I think there’s just so much knowledge here. As we’ve already said, I think this is going to be one of many conversations we may have together just based on your background. But for our listeners here. You know, Hutton is the Founder and CEO of BEYOND M&A, which addresses technology challenges for companies and brings a wealth of experience to the table. Early in his career, you know, complex M&A software projects were a part of the crucial lessons for him. People matter more than tech. Since then, he has consistently prioritized the human element in all of his professional endeavors. His career spans beyond significant technology projects, including for Jaguar, and HP Compaq, and in recent times, is engaged with private equity investors and PE back firms, leveraging his specialization in technology and his love of helping people grow. I know we’re going to dive into this, but you know, you really are an expert in the inner workings of SaaS firms that are looking to attract investor interest and exit strategies, providing assessments even to the psychological levels of tech teams to help for the design of diversity of thought. There is so much we’re going to talk about here. Is there anything else that I can cover up their head? I think we could do a podcast on just your intro.

Hutton: You can come on my PR team Ryan. Thank you very much.

Ryan Davies: You know what, it’s easy to be a hype man for somebody so strong at this. That’s for sure. But I think what we should do is kind of start with a little bit more of an introduction of it, you know, providing an overview of BEYOND M&A mission and maybe your focus on a personal level in terms of assisting SaaS and tech firms.

Hutton: Yeah, Sure. Thank you, Ryan. So, I started this company a couple of years ago. But really, I’ve been working in this field of assessing firms for investors for the last seven years. But I take it a much wider scope. I’ve been in business technology for 30 years. And there’s been this sort of interweaving piece, which is always around people. It’s always fascinated me when technology projects don’t deliver value or they don’t deliver at all. What are the underlying problems? It’s always obvious how we interact as teams and as humans. So that’s been the underlying theme. And I’ve been very lucky in the last seven years to be working for the investors you mentioned, to understand and try and interpret what’s happening in those technology companies and interpret it in a way that investors understand what value they can get. So it’s like being an interpreter. I absolutely love the work. It’s quite an honor to be able to come in and assess the business, talk to the management and for them to show us everything they’re doing. And there are amazing things going on out there. So yeah, that’s where we are.

Understanding the Importance of Self-Awareness and Value in Tech Startups

Ryan Davies: I think that, you know, to me, that just sounds like a dream as well. I absolutely love that idea of really going in and helping kind of get that third-party view. And I know you do something different, right? There’s a lot of people who go in there, and they give this like, here’s your technical scorecard. And here’s your, you know, insert formula here, insert numbers here, okay, here’s the output, right? But you really focus on things like self-awareness for founders and understand the importance and the strength of their personality. And you know, what they really bring to the table is their personal strengths. So I’d love to talk about a little bit more on that one of you know, how self awareness really helps contribute to the success of tech startups and growing tech businesses?

Hutton: Definitely. So thanks. So, really, I think, number one, investors are much more savvy, and they understand tech more than people probably understand. And secondly, I mean, every investor website will always say they’re very people-centric, but how do we translate what’s going on with these ones and zeros into, you know, these humans, and how do we provide data? As I mentioned before, I was quite interested due to some personal project failures as to why these things went wrong. And that got me into the last sort of seven or eight years, doing psychological assessments of the tech founders, and I’m a qualified COBie consultant. That is our USP in the market. One of them is that not only do we look at the tech and the P&L, but we’ll be able to look at the team and understand the diversity of thought within that company. So an example might be we worked for this amazing company in Silicon Valley. We have 50 people in that team startup, building software for some very well-known firms and one of the best cultures they’ve ever seen. But their business problem was they weren’t growing. And when we looked at the team, it was quite evident that even though they they look quite different, you know, they had all the diversity checklists done, you know, gender, ethnicity, age, everything was there. But underneath, everyone was the same. So, under stress and pressure, these people will always be going in the same direction. And we obviously know all of us from the workplace; if we can have that diversity of thinking or thought challenged, it creates a better sort of creative environment. So that’s the big thing. And I absolutely believe that, you know, if I can help founders understand themselves, you know, just increase that self-awareness, that then increases communication, and then has a ripple effect across the whole business. And the last thing I would add, as well, as you often find, definitely in the companies, we get to see there is that interest in that self-awareness because I was quite scared of coming in with this wacky idea that I was going to be looking at people’s brains and how they operate first because we’re talking to tech companies, would they be accepting? And secondly, would they believe it? You know, because at the end of the day, they’re engineers, you know, whether they’re building a scaling company, and I’m really pleased to say it does work, it definitely works. You can see that suddenly, when we have that information, we often find that the investor has made an incorrect assumption about the team. We’re gonna have to augment that person with this, this more senior person, or we’re going to have to replace the CTO. Very common situations, and what we can say is no. They need coaching postale to step up to what you think is right for you. So I definitely say if you can know yourself, you’re absolutely. Energy energizes the team.

Ryan Davies:  Absolutely. Yeah. Does it help that I’m an 8553, and Colby because I have that one too? So I just by that you’re gonna be able to look at me go. That’s why I like all of these questions. I love fact-finding. I want to learn learn learn all this.

Hutton: Well, actually, that’s brilliant because so that that profile is 8553. I’ve worked with that 500 people since 2017. And what I found within the tech teams, is most of the profiles are like an eight, six, and then low numbers for that. So the first two are always lacking eight six. And so that, but it’s my mount with that, you know, we were hiring people, all of the Canadian clients. So good to meet someone with a Colby profile as well. It’s really.

Ryan Davies:   I mark my CEO, and the guy you know, mentor me through all of this and everything. He is heavily he loves Colby. And all, you know, into it big time. So we, you know, even when I remember when we first met, he was like, No, it’s kind of weird. But can you do this, so he can really I just want to understand how if we’re going to grow together, how I should approach it, what tasks you’d be best at, and all of that kind of thing, right? And, I mean, here we are, you know, years later, just continuing to grow and succeed and do wonderful things and help other other tech founders and everything out. I think it’s a great thing and I think, you know, it’s incredibly important for founders and everybody really to effectively assess, like you said, and leverage those strengths in the context of building and scaling and things like that. You know, I know you have a system, you know, is it in terms of how to be able to effectively do that could you kind of help again, don’t spill your secret sauce, but maybe a way that you could kind of help us understand that process a little bit more and the value behind it?

Hutton:  Yeah, before I jump into that, I mean, the just with your Colby did it how did it help you because you have that numbering system works, right? Yeah.

Ryan Davies:  Yeah. And I mean, like, honestly, for me, personally, what really did for me was, I’ve done all of, like, the Myers Briggs stuff and like the disc scores and everything, and I’m always like, Yeah, I know where I am. I’m way up here somewhere in the top quadrant and okay, you know, extroverted and everything like that. But this gave me a different thing beyond that of being like, you know, there’s no right or wrong, but it’s just where do you need to focus right like my implementation score? Low. I love finding out facts. I can get stuff moving in the ideation stuff. But when it comes to, like, getting it there and, you know, don’t, my wife would be the first one to say it, right? You’re really great at getting a job 80 to 90% of the way done, but that’s where it stops, right? So I’m like, Yeah, it’s true, right? It’s like, I can take out the garbage, but I don’t put the bag back in kind of thing, or whatever it is. So same sort of thought process, right? It helped me really understand the great. I know where I’m strong, and I know that I love doing what I love doing. But it helps me identify where that gap is, where it’s going to fall off, where I’m going to have trouble, right? It allows me not to focus on the things that I’m good at but on the things that I know I’m going to struggle at and create the time and the processes. And again, I’m a big process guy, obviously. Right? So can I create a process that allows me to implement better, that allows me to do those other pieces in terms of, you know, the follow through and the Quickstart, and all of those sides of things, right? So being able to, you know, don’t over promise and use very specific details so that I follow through properly and all that kind of thing, right? So it really, really enhanced me. Again, I appreciate it. I think that’s why I’m so excited about this conversation. As you can tell, I appreciate the value of Okay, great. I want to not everybody has thick skin, right? You could take it and get sensitive about it and things like that. And I think Colby does a great job of that of being like, look, there’s no right or wrong answer is just really reflecting on where your strength is. And where is the opportunity? Where do you need to focus to be successful?

Hutton: You shape the world around your strengths. That’s right. Yeah. Most of these systems can, I was quite interested. So I had an experience years and years ago while I was working on a merger; we had the software product. And it just it was an absolute failure. And, that’s what made me sort of wonder why did that happen? And it has to do with buy-in. When you merge companies together, when you invest, you’ve got to have buy-in from so many sides. So that was the the key thing. So, as you mentioned, you have to find your strengths and then use those right within your tech teams. Then, back to other questions about the process and the way it works, which is actually on one of our front web pages. So we’re not secret around how we operate and the whole process. And we call it act release. So, we assess, challenge, and transform our business, and in the assessment piece, we obviously have to assess technology, people, and processes. But that’s also where we need to understand the assumptions on both sides. So, if we work as an interpreter, we want to know the investor’s perspective, how do they think that company is going to scale? We also want to know, the founder’s perspective, how do you think that the investor is going to help you because there could be an absolute disconnect, or maybe the technology won’t do what the investor has read into your information. So there is this very human aspect to it. And often, so in terms of the process, it’s very clear on our website, so that we assess the challenge and transform, but the assessment piece, as much as it can be very data-driven, it is very much around your experience in the industry, and working for companies that have scaled, have taken your investment and really what we’re trying to do is share that between our team and what we’ve seen in our careers to help the founders. So I’d say the other thing that we do is we’ve sort of switched the focus to be on the founders because we realized that if we can help them first and sort of get their company ready, that’s really beneficial for the investors as well and you go to the fat, you go to the investor, with your most polished business looking at its best, rather than we found ten red flags, you’re not running it as well as you could be. So, I wasn’t sure how that would work with investors, but they loved the idea.

Ryan Davies:  I think because now you’re you’re providing value to all the stakeholders involved. Right? Like you’re it’s really what, again, just like, you know, well, I’d love to talk about this more, you know, market versus the technology, right? Same sort of thing. It’s about your market and the founders, not your technology, and going well, my technology works, and that should be good enough. Right? There’s really, you know, we hear it all the time here, but is the market right? Are you approaching your customers properly? And are you the right person for it? We still invest in people, right? That’s a big thing. So I think you know, I’d love to get your take on that. Because we hear it all, you know, I’ve got great technology, so my business should take off, but I, you know, do you feel that market is more crucial than technology when it comes to these assessments,

Hutton: without a doubt. So, it is a sort of mantra within the business that markets Trump tech. So it’s wonderful to be able to do our job. That’s great. We love our job. But at the end of the day, what can power a company more is a market need or a growing market. Whatever the market condition is, we can really sense it when we assess a company. So, you know, I could be talking to the most advanced. I mean, a couple of years ago, it might have been a web three blockchain conferencing thing, and it would be highly technical. And it was quite high profile. These kinds of companies were very high profile then. But there’s still a niche in terms of the market. But if you’re a man, I guess the best example is something like Waze. You know, that market is huge, isn’t it? It’s just that we all drive cars, and that product built its own map? It was based on a community. Everything says smart. And I do like that idea. If you’ve heard that Google like, when they acquire businesses, they like to have companies that have the toothbrush model, which is you need to use it twice a day. Right? So you’re not having to drive your customers back to your Saas product. There’s an incessant need for you to use a product, and people keep coming back. So, there is a part to taking that solution. But the big thing about the market is, in my position, that’s probably the last seven years has taught me that market absolutely Trump’s tech, you know, and when we meet the founders, they’re so like, they’re really wanting to show us the intricacies of these. But we want to understand how does that translates to commercial value. But also, how does that translate to potential value to a new person coming in from around?

Balancing Innovation and Business Value in Tech Startups

Ryan Davies:  I think that makes you know, again, it’s just so critically important to drill that point home. And again, I think that maybe helps understand maybe that value gap that you were talking about, right? Tech employees and founders just lack that value within their business and that gap that exists and how critical it is for success. Now, kind of pushing a little bit further here, you know, we’re talking about, you know, maybe now how do you balance innovation and provide still business value? And that kind of balance between the two, if that makes sense?

Hutton: Yeah, totally. So something that we give a number to the investors, we give them a ratio. So there’s a blog on it on our site, which is the maintenance ratio. So you’re about to jump into, you’re going to invest in this company, but please be aware that 46% of their time will be spent on the old stuff. They are keeping the lights on, keeping it running. So you’re only going to get, you know, the 53, or whatever the percentage is, as innovation. And so, we do like to show that very early in the conversations. And the best founders, we know, we meet, they know that number before we meet them. You know, they genuinely there is some certain traits around the founders and CTOs. Like the ones that know the time to value, you know, you can like him still remember, the guys are just sat there and thought, oh, my gosh, I would not like to be against them in an interview process. You know, because they’re so good with their numbers, they know that their team inside and out to a very analytic, analytical and mathematical position, that those numbers tell you everything about the business. So you need like time for a feature to come to value, or the door metric type things that go with DevOps. But then the one thing, as you’ve mentioned there, Ryan, is that ratio of maintenance versus innovation, but there’s one more important thing is: how much innovation does the investor really want? Because they may not want it, the investor may actually say, You know what, that piece of tech is perfect as it is. I don’t want to spend any more money on that for the next few years. I just want to make it more commercial. So that’s another factor that it’s not always not innovation, that often it’s about stripping it down to the most commercial value, really.

Common Pitfalls in Tech Startups Seeking Funding and Scaling

Ryan Davies: There’s just so much so much to take away here. I think we’ve talked a little bit about it here. Just as simple as not understanding yourself, not understanding your market, or things like that. But I’d love to talk about, maybe based on your observations, what are some of those common pitfalls that tart tech startups, you know, face when they’re seeking funding when they’re scaling? And, you know, just again, we’ve talked a little bit about the ways they can be avoided. I think it’s, you know, relying on having measurable things and experts like yourself, people took back then. But maybe just a little bit about both of those if there’s some common areas that you see, you know, this is just an area that too often could be avoided.

Hutton: I would say this, right, because this is my business. But being unprepared is just this situation of pressure, you know, so we have an ethos that you should really get your things together, your document, everything you need, needs to be ready, and you can build up over time, you could do something with your team, once a week for an hour, say, right, we’re going to fill the data room with this amount of information, you know, for what we see time in and time out every single time is every single team, whether it’s a startup scale up or even beyond that, they wait until the investor says, Can we check out your company? And that’s the point they start to build their case? You know, like, we’ve all watched those Hollywood movies with the lawyers who stay up at night, building this case of information. This is the mode that they go to for about six to 12 weeks, right? On top of running their business, right? So the number one thing is, you know, start thinking about building that case beforehand; it’s a very simple thing to do. Because no one knows your business more than you, that’s the number one rule, right? The second one is that we talked about a little bit, and it would be good if that piece around value is that the most common problem we see, even in very successful scale-ups, is the inability to articulate value. And it’s as simple is, you know, I’m going to put, I don’t know, a million pounds into dollars into this, this project, and I’m going to get this amount out, it’s as simple as that, we often don’t see it. And this mostly because the companies can operate in their own way privately for a long time. And that succeeded, and they’ve never had to justify to an external body that if I put something in, I get something out because, in most cases, we’re pivoting like crazy. And we’re finding that value as we go. So articulating that is honestly, like, the company can be 15 years old in the 10s of millions of revenue, and they haven’t got a roadmap strategy or any financial plans.

Aligning Business Strategies with Investor Expectations

Ryan Davies:  I think there’s just so, again, so much great things to take away. Hear you, you kind of helped us so much here. And I know, you know, we’re already getting tight on time. Like I said, we’re going to need to do a bunch of these because I think there’s just so much more to uncover for our listeners, but I’d like to kind of just keep drilling a little bit further, you know, maybe on aligning their pitches, right. So, you know, like you said, there are pitfalls there. You don’t want to have that six to 12-week all-night, living on coffee Sprint’s sort of a thing, right? Be prepared. But I would, you know, there’s got to be some personality to your pitches, there’s got to be some alignment there, again, know who you’re pitching to that sort of thing, right? Again, know your audience knows your market, just like you do your customers; you got to know who you’re pitching to. But do you have any advice? Any thoughts on, you know, aligning business strategies and the expectations and priorities of investors? In today’s, you know, highly competitive funding landscape?

Hutton: Yeah, you’re right. It’s very competitive now. I think you have to work harder, right? So yeah, and I know you’re talking a lot about AI as well. And that’s a very hot topic. But it’s evidence, right? That’s the number one thing that the use cases need to show value for. And you’ll hear me time and time out say that as tech people, we’re not taught enough around the term value itself. And you’d only you, and the more you go through the different stages of funding, the more that becomes more evident. So if you can learn that at the beginning and then start to pique their interest around the value you’re going to create, you’ll get much more sort of buy-in. That’s number one. Number two, I definitely recommend, if I don’t, if you’ve done this, right, that builds like you’d have something like Toastmasters, you get these dead pitches are dead, you know, and often, when we come in, and we assess the company, we get to see the pitches, and it’s like, wow, how on earth did they grow that business? Because that pitch was terrible. Course, you know, I love the imperfection, by the way. I mean, that’s, you know, they can try out in very safe places like Toastmasters or anything like that, even with family. You know, it’s because the investors just need to be engaged emotionally. And the two things we would say that post-deal, so pre-do, it’s about preparation in many ways, but often, we don’t know what we’re prepping for, so you know why we try and provide information on that, you know, this is the areas you should be looking at. But then there’s another crucial step, which is the first six to 12 weeks after you get your investment. Because if you’re lucky, it’s going to just go like wildfire. Right? And suddenly, you’re going to have more growth, more governance, more need to present. So you’re going to have this accelerated need, yeah. And somehow, you still got to run your business. And it’s never going to be the same as the one that you were presenting to the investors to how the growth going that you presented to them. And, yeah, I mean, there’s another side to this, isn’t that which is the investors’ perspective.

Building a Strong Foundation for Tech Startups

Ryan Davies:   I think, first of all, my first thought is, so our next podcast is going to be that first six to 12 weeks after you’ve gotten your investing, because I think that could be just so again, so incredibly valuable, like you said, now you’re resource-rich when you’ve gone from so-resource, not even poor, destitute, right into this resource-rich, where you’re like, Okay, now what, right? And you’ve got expectations, you got people to answer to all of that sort of thing. It’s incredible from that perspective. And I think, you know, that is just a great, again, another eye-opener of what to expect. And again, that level of preparation and things that need to be there, right? So with that, you know, I know, we’re kind of closing off here, but I want to kind of give you an opportunity here at the end to sort of, you know, I was going to say, you know, what advice do you have to ensure they’re building a strong foundation, but I think, you know, that advice really starts with surrounding them with people like yourself, and understanding where they are and where their strengths lie. So maybe you can tell us a little bit more about how people can, you know, get in contact with you and really use those resources to put them on the right track.

Hutton:  Yeah, definitely said, so we do have a number of scorecards on our website beyond-ma.com. I mean, really, we’re providing that information so that you can test yourself and look at those self-awareness aspects as well. There’s a CTO scorecard as well, which I highly recommend because we’ve based that on the last seven years of experience. The number one thing, and we definitely think, is there’s a pattern to all of these, and you shouldn’t be penalized for things that you can easily fix yourself. That’s my view. If you can’t avoid consultants, do it. That’s my view, you know, avoid consultants wherever you can. But you know, just build your business because no one else knows it better than you. 

Ryan Davies:  That’s amazing, right? It’s just beyond-ma.com. Go there, take your tests, learn more, and uncover things about yourself that maybe you assumed to be correct and aren’t right or areas that you could say, Wow, that’s a new area of focus, something I can look at. And this is stuff that just, I think you kind of hit the nail on the head there when you were saying how, you know, we get a lot of preconceived notions, even about ourselves, even about our business. And that can hold you know, hold us back from a personal and professional perspective. And I think this is just a wonderful tool and a wonderful way to be able to start that process and that change and really get an unbiased look at who you are, what you’re doing, and how you’re going to scale and grow it and really secure that fundraising. That’s so critically important. So, you know, with that, I think that’s a great place to leave it for this one button. You’re not going to get rid of me. I promise you’re going to have to do more and more of this with me because there’s just so much here to unpack. And I think our listeners are going to be requesting more FaceTime with you virtually here. Then, hopefully, in person as well. So, Hutton, I want to thank you so much for this amazing podcast and for your time today. I can’t thank you enough. And our listeners are going to be indebted to you. And I’m sure reaching out as well.

Hutton:  Thank you, Ryan. It’s been a pleasure to be here. Thanks so much.

Ryan Davies:  Wonderful. So with that, thanks to HUD and Henry for this amazing podcast on Tech Founders, Know Thyself: Hutton Henry on Personal Strengths and Funding Success. I also want to thank our listeners. As always, we can’t do what we do without you so until we meet again with another amazing TBR episode. I’m your host, Ryan Davies. Thanks, and take care, everyone.

About Our Host and Guest

Director of Marketing – Ekwa.Tech & Ekwa Marketing
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Founder & CEO @BEYOND M&A
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” As tech people, we are not taught enough about the term “value” itself, and the more you go through the different stages of funding, the more evident that becomes. “

– Hutton Henry –