Action Now CFO is on a mission to help business owners achieve business growth and stability. In this podcast interview with host Greg Levine, Frank Cottle shares valuable advice on building a business – from project management right through to global business growth.
Transcript:
Scott Donald [00:00:00] No matter what you’re doing, the moment you leave the dock or the moment in your structure that you start a project, you have to be constantly making little adjustments. And the thing that makes a boat go fast, if you if you’ve been around boats or sailboats or anything is steering as little as possible. The more you steer, the more you turn that rudder, the more pressure you put against the water and it slows you dow,n that’s how you turn the boat. So, with a business, a lot of times it’s the same thing. You want to give it on a course and make tiny little micro adjustments constantly and try to steer as little as possible. And that’s what keeps you out of problems, in my opinion, as opposed to having to have big turnaround.
Greg Levine [00:00:52] Welcome back, everyone, to your personal CFO podcast. I’m your host, Greg Levitin, your personal CFO. Here to open those you’re counting part time CFO needs, we are back here for another podcast. Want to thank you all for being a part of the program and as always, if you want to check out any previous podcast episodes or see anything going on with the company, go over the Web site, www.ActionNowCFO.com. Again, web site is actionnowCFO.com. As I said, this is the podcast where we can, we get, to be privileged to learn from highly successful entrepreneurs and what it takes to create, grow and run a financially successful business and how they are not only succeeding, but thriving throughout the process. And today, that is the case with our guest. Our guest today is Frank Cottle. Frank is the owner of the Alliance Business Centers Network, which provides premium virtual office and telecommunication solutions for companies all over the world with over 700 office business centers operating in over 50 countries, and we are excited to have Frank on the show. Frank, welcome.
Frank Cottle [00:01:54] Well, thank you, Greg. Very happy to be here.
Greg Levine [00:01:56] What is it like to be the leader of such a big company with locations all over the world, over 700 locations? That sounds like quite a mountain to be on top of.
Frank Cottle [00:02:06] Well, it really isn’t. It’s a very, very simple our company has been built over a number of years and I think even though we operate in a lot of countries, different languages, different currencies and cultures and things of that nature, that’s really what keeps it fun, if you think about it. What’s that old definition of insanity? Doing the same thing over and over and expecting a different outcome? Well, I think if you are in business and you do the same thing over and over, it will drive you insane.
Greg Levine [00:02:37] It makes sense I hear you on that one.
Frank Cottle [00:02:38] we like to go out and try things, new things all the time.
Greg Levine [00:02:41] I like that trailblazers are afraid. So on before we jump into this business, I’ve listened to some other shows that you’ve been on, so I learned a little about your past and I learned that you were a commercial diver. So basically you were one of those guys that goes under the water and constructing bridges, I guess, and other sort of infrastructure. Can you kind of jump on that a little bit and tell us that?
Frank Cottle [00:03:02] I started off quite young. I made the decision in about little my sophomore year in college, the dropouts got all the good jobs. So I ended up going in a little different path and worked as a commercial diver, worked for a company called Allied Marine Technologies. And then our own company, Aquarius Maintenance and Diving. We started that I started when I was 20 and we had contracts with a couple of government agencies and worked done the gas and electric, doing underwater search on cabling, making sure the cables were all running and things about nature and we worked on a lot of maintenance on the Pacific SEAL fleet actually, which was our Navy’s the CIA’s Navy in Southeast Asia, if you will. That was a little bit exciting to do a bit of interesting training to deal with that crew. That was all good work I mean, I think getting down, getting dirty, getting at it is what you learn and you also learn that you have to be able to make decisions. If you don’t, you’re going to get hurt, other people are going to get hurt and you better make decisions quickly and you better make them right. And I think that’s a lesson I’ve carried with me through business is no matter what you do, it’s the one thing that we tell people getting fired in our company. If they can’t make decisions, we want everybody make decisions top to bottom. And that goes to your comment about, you know, is it challenging, operating things in on a global basis down if your whole team of decision makers. And that’s very important in my view.
Greg Levine [00:04:51] OK, before we jump into that, can you. Well, just saw a little bit of time on this, but I’ve got to understand, what is it like? Are you underneath the water and you’ve got, I don’t know, much of iron and stuff that you got to make a bridge or you get to build something like what is it like down there and how does the job work?
Frank Cottle [00:05:06] It’s cold and dark and things go bump and most of what I was involved with was someone some construction. But most of what I was involved is, was ship maintenance, certain types of ships they don’t want to pull out of the water because they don’t want the bottom of the ships shape or antennas or things of that nature of being seen invisible to security thing. So we would go down and do all of the maintenance additions, replacements of parts, fittings, things of that nature. And it involved everything from working with heavy hydraulic equipment to underwater welding and things of that nature. And a lot of observation, honestly, a lot of photography, taking pictures of things so that they could be assessed as to what to do with them and how how how to fix them. So cold, wet, lonely sometimes when you’re the only person or there’s only two of you down there and the water is murky and it’s just not the most fun thing in the world, it’s out. Sounds real adventurous, but it’s just hard work very hard work, you Bernard Tomic hours.
Greg Levine [00:06:13] How long would you be down there to time?
Frank Cottle [00:06:15] depending on whether we using standard tanks or mixed gases, we’d be down between about 90 minutes to three hours. You can stay down longer with mixed gases. Basically, you’re breathing a mixture of oxygen and helium instead of oxygen and nitrogen and that you can the helium doesn’t get absorbed by your body as quickly as nitrogen does. So you can stay down a little bit longer.
Greg Levine [00:06:44] Wow! that sort of sounds like down in a mine like it kind of excited when you get out of there, you’re sort of like stay from procyclical.
Frank Cottle [00:06:53] Yeah. It’s always nice to see the sunshine up top. That’s always a nice moment when you break the surface again. Doesn’t matter what you know, it wasn’t sport diving like you see a beautiful warm waters and lovely, you know, fish and this was deep, dark stuff.
Greg Levine [00:07:10] OK. All right. Well, you know, we could spend the whole time on this, but we are here to talk some business. So let’s talk about your company and growing a company up to 700 locations, 52 countries. So let’s talk about the beginning days and you’re sitting there, you come up with this idea. Did you think at that time that you’d be sitting here how many years later with 700 locations?
Frank Cottle [00:07:32] Well, I’m actually disappointed that I don’t have a couple of thousand. So the answer to your question is yes. We always felt that we would build up a large organization, and that was the goal and the goal was always to build, ultimately to build globally. It was a bit iterative, the company’s building blocks have been in sort of decade chunks. We started as a property company doing land banking, basically buying a piece of land in the path of progress, usually a joint venture with a large commercial developer. Chevron Land, Mobile Land, Prudential, Trammell Crow, those types of guns. And building a building on it that served our purpose and our purpose was to build the smallest building possible on the biggest piece of lands possible and then figure out how to make it pay and the way to make it pay with these funny little things back in the late 70s and early 80s called executive suites. So we learned that business over a 10 year period and built quite a number of projects across the southwestern United States and then decided that we wanted to move faster and build more projects more quickly. So we sold that portfolio, the times were good for selling real estate about 1990 and started building leasing space from property companies, from other larger property companies and building out space within other larger buildings, which is really the most common model in the serviced office and coworking industry today. So we built one hundred 95 projects across North America during that first 10 year period. And it was quite exciting a lot of fun and then we decided to change that, there were three of us as partners to change that business model. One of the partners wanted to go play golf, one of them just wanted to retire and myself, I wanted to keep going. So we sold that company and I bought the partners out of the remaining interest that we had maintained. And I wanted to change the men’s business model of I no longer wanted to physically own the centers, but I did want to own the customer. And so go back into the late 90s and think of the beginning of changes in the travel industry a little bit. Look at Expedia as a good pioneer and Travelocity as great pioneers in that area, they decided that they didn’t have to own the hotel, that they could own the customer and they built the technology and the network structure in order to do that and that was the model that I decided I wanted to pursue as well. So the first thing we needed was inventory. So we built a network of centers that runs on a business model, much like Best Western hotels. We don’t physically on the facilities anymore, but they are part of our network and we provide a variety of services to them to basically back off the services. So we had inventory and once we have inventory, you just have to be good at the marketing and sales and the technology to interconnect to that inventory and to deal with things. So we really have gone from a property company to a business process outsourcing company an operating style company to now we’re primarily a software as a service technology company. That’s what holds our technology and our service structure that holds our network together. And that’s truly our core business now.
Greg Levine [00:11:19] So you are learning new stuff daily, It sounds like…
Frank Cottle [00:11:23] Every day, every day. What’s the fun to go into work if you don’t learn something, right?
Greg Levine [00:11:28] Which countries that you guys have gone into outside of the U.S. have been the most exciting and most the easiest or the most enjoyable to enter and surprising? And I could get stories about that.
Frank Cottle [00:11:40] Well, the United Kingdom, the Greater London marketplace is probably the most exciting from a business point of view because it has very high density in our industry and it’s also seemingly competitive. So if you have that kind of excitement is good, another type of excitement we just built a project with the Kazan government agency and an investment group. We actually built the project in Kazan, which is in Tartus stand on the Volga River, 900 miles east of Moscow. That’s a little bit exciting, especially right there. It’s about 10 or 12 degrees below zero there right now, so it’s very radical weather. So that’s a departure for us, we’ve been building recently throughout the Gulf states in the Middle East where we actually do build in our own name. We have a model that looks much like Mary Out Services, where we license an investment group in the country, and then we build the centers and manage the centers for that investment group. And we’ve done all the Gulf states now and this march, we’re actually starting in Africa. So I’m excited about that, we’ll be starting. Our first center will be in Accra, which is in Ghana. So that’s kind of fun.
Frank Cottle [00:13:05] The challenge is… people. Figuring out how to bring that team together in new markets, figuring out how to service clients that are culturally are much different than yourself and understanding, you know, what service means to someone in Ghana versus service, meaning something to someone in Atlanta. And making sure that you provide high quality services to people. We are a service industry.
Greg Levine [00:13:41] So I’d like to touch on that so, as you mentioned in Kozan. I’d like to know, number one, how you knew there was a market for that and what are the people like there? Like how do you service them? Maybe a little bit differently than you would service us here in the States?
Frank Cottle [00:13:56] Well, wherever you have a very active economy. But either a very restrictive, rigidly structured or sometimes unstable government. There is great opportunity. OK. Especially in our industry, because we’re in the business of leasing short term, high quality offices and services. So wherever you have that position of activity, it’s it is a good market and Kazan is a, most people aren’t familiar with it, but it’s the largest city economically in Russia. And it sits at the very apex of the Middle Eastern oil patch. So if you draw a big triangle, you could say that maybe Iran is in the lower right hand corner in Saudi Arabia, Emirates, or in the lower left hand corner, the very peak of that triangle is Kazan. And we were asked to go there by an investment group that we deal with in the Gulf States out of was Sheikh Mohammed Al-Thani of Qatar and his group asked us to where we had built projects with them, asked us to go up and build the project in Kazan on on their behalf. So we were actually invited up there we didn’t really do much market research they said, here’s the money, go build it we want one. So we did, and that’s really comes with having good partners and a lot of trust between partners as you build your business. We do a lot of business literally on short memos and handshakes and we found that contracts don’t keep things together when you’re doing things internationally, people do. Solving problems is what keeps things together and having good people but contracts or, you know, if you’ve ever, ever tried to look at Sharia law or you’ve ever tried to learn how to get something done in a another country where you don’t know the language and you don’t know the legal processes and this and that, and it depends on the contract, you’re just going to be mired.
Greg Levine [00:16:16] Wow, this is fascinating stuff. So are you making the trip over there?. Do you go to the Gulf States and to Kazan and all these places where you guys have new things pop up?
Frank Cottle [00:16:26] Occasionally, occasionally I’ll be over in the in the Emirates in late April or early May, early mid-May and then again in November. One of our company activities as we host conventions on behalf of our, our industry, we’re the largest convention organization of the industry also. And so we’re and we’re hosting a major global event in Dubai in November.
Greg Levine [00:17:07] So what’s going on with that global event in Dubai?
Frank Cottle [00:17:10] We’ll have 500 to 1000 companies there from our industry or people interested of learning about our industry and it will be a three day educational conference that will that we will sponsor and participate in, and we just bring people together and, you know, spread the word. A lot of educational information, best practices, trends, trending changes, really like any major industry conference. We are involved in five to six of those that we co-sponsor globally. So this year we’re doing New York, Toronto, Melbourne, Sydney, Beijing, probably I’m not sure what that Beijing of Shanghai, but I think it’s Beijing, Dubai and then London.
Greg Levine [00:18:00] AlI righ Frank. So I’m listening to your talk, and this is just awesome and very impressive. And I’m just wondering, like, how long how will young maybe when you were there. Do you remember just having these big visions and knowing that you could accomplish great things?
Frank Cottle [00:18:16] Well, you know, we mentioned Dubai and I’ll use what my CFO or the CEO of our armed division out there says quite often. “Sure, why not?” That’s his answer to almost any challenge. I say no. Do you think we can do this or this or this is just “Sure. Why not?”
Frank Cottle [00:18:38] Well, that’s really the way I think I’m lucky enough to grow up in a very entrepreneurial family. My father and I had been quite successful in business activities and I grew up in a multinational, fairly large company environment. So from the time I was a little kid, I was hearing about, you know, the problems that were happening in Saudi Arabia or the challenges that were going on in Taiwan or what we were doing in the South Pacific or in Latin America. So I grew up with that around the kitchen table. And I think that’s a big, big advantage, it’s never seemed odd to me to jump on it and it’s never seemed odd to me to go somewhere else and do what you want to do, especially the more you travel and I’ve had the good luck of traveling a lot all my life. The more you travel, you realize that, you know, people do things… We don’t do anything unique here, you know, there are very few a new original ideas or just different ways of expressing them and different ways of executing on them. So, when you go around the world, the acceptance of most good common sense ideas are very easily practiced and then it just comes down to execute. We could give anybody I know a business plan, here’s our business plan, here’s a performer, here’s the money. Now you go do it what we do, and very few people can execute well and that’s really what comes down to it. It’s not the idea, it’s the ability to make the idea come to reality.
Greg Levine [00:20:28] Is there any specific culture that you found to be very challenging or very different to work with, and possibly you made some mistakes that you didn’t think would, would happen? And then just due to the culture, just thinks, you know, three or four, Lupe?
Frank Cottle [00:20:44] No, I think different cultures and different business environments move. They are all able to deal with the same challenges, but they basically move at different speeds. I had explained to me once by a coach that we were talking to and he said, we all know about the Boston Marathon or the San Francisco Marathon, which is actually the example he was using, that everybody has signs up for that marathon. Those were the start is and they know where the finishes and everybody knows what time the race starts. So up at the front, you’re going to see those really sleek, well oiled pros and you know who’s going to win. It’s going to be one of those 10 or 15 people that are right on that front line at the start. You know that, behind them or the super, we can voyeur’s Olympic hopefuls, people that are really going to go behind them, are another group of really fit people they’re really looking to do their personal best. Behind them, there’s the people that are going to run a three legged marathon or a briefcase marathon or whatever and behind them, there’s a whole bunch of people milling around at Starbucks just trying to decide if they’re really going to run or not. And that’s the way business is, everybody knows to start. Everybody knows the goal and the finish and everybody knows when the start is. It’s just how committed they are to finishing and doing their personal best and improving that daily and so people run at different speeds. And when it comes to cultures at different points in time, different summer ahead, and some are slower, some are faster and some are slower. Part of that depends on access to capital and part of it is just a cultural imperative, a belief that they can do it. Asia is just booming right now, particularly Chinese Asia and there were 20 years ago people were challenging themselves can we do this? Can we do that? Now they feel that there’s nothing they can accomplish.And so, they’re making the decisions to do so very aggressively and they have the access to the capital to do so. So I don’t think there’s anybody that’s good or bad, just we move different pieces based on our own timing.
Greg Levine [00:23:08] Gotcha, also very fascinating. All right, Frank. So on this show, we’d like to talk finances and how you kind of stay on top of your financials. So tell us, what do you do? I mean, you got 700 plus different locations and all these different countries. How are you staying on top of the financials? I mean, that must be just tons of different reports and it’s got to be somewhat challenging. So tell us, how at this stage in this big of a business, it would condense everything and be able to look at some financial reports and make sense of them all?
Frank Cottle [00:23:39] Well, we have two meetings a week as a team. The executive team does a Monday morning meeting to say, you know, what’s up? Is everybody here? Well, what are we doing? Just kind of touch base for about 30, 45 minutes, and then Thursday morning meeting for an hour or so where we review administration and finance and we’ve got a nice, well-developed dashboard with the necessary KPI’s to help us see what we’re trending, and then we deal with the anomalies. It’s not as complicated as one would think, but the high at the top level, at the bottom level, different collection policies in different areas with different things, currency exchange rates, all of that. That all has to be managed but we have an excellent CFO and director of finance. He comes from a public accounting or a public company background NYC company, a recording company.
Frank Cottle [00:24:39] So he’s very capable in keeping things and then as part of our business, well organized. Is it perfect? No, nothing is. Do we have surprises? Of course. That’s why we have meetings and that’s why we make decisions. But generally, we know our business well and I think that’s the key. It is not what system are you using or what, what, what secret do you have? It’s just really understanding your core business. And if you do, then you spot trends and you feel things long before you see it in a report, and that’s one of the things that our team is very experienced and we’re in constant communications. We’re scattered around the world so that makes it a challenge. In terms of ours sometimes, right time of day or night to do things, but it’s just really knowing your business.
Greg Levine [00:25:40] Was there ever a time where you guys looked at the financials and something looked like it had been a downturn? And if so, what you guys do to turn things around?
Frank Cottle [00:25:49] Well, we’ve all had our holy crap moments where you see things. But, yeah, I think if you know your business, you see them in advance. You say we’re trending this direction, what do we have to do to adjust and make that adjustment? And it’s funny for about ten years after I was in the started off through college and then the diving business and such. I was a broker and a racing sailor, that’s how I made my living. And, you know, it’s very much like the analogy of the marathon when you are racing a yacht, if you’re sailing from here to Hawaii or something and you’re racing. Well, you know, this is where the start is, you know, where the finish is that you’ve got all these variables, you’ve got currents and weather winds and others say other races that you’re going against and you’ve got the issues around crew and equipment, things break. So no matter what you’re doing, the moment you leave the dock or the moment in your structure that you start a project, you have to be constantly making little adjustments. And the thing that makes a boat go fast, if you if you’ve been around boats or sailboats or anything is steering as little as possible. The more you steer, the more you turn that rudder, the more pressure you put against the water and it slows you down, that’s how you turn the boat, so with a business, a lot of times it’s the same thing. You want to give it on a course to make tiny little micro adjustments constantly and try to steer as little as possible and that’s what keeps you out of problems, in my opinion, as opposed to having to have big turnarounds, know your business, make tiny adjustments daily.
Greg Levine [00:27:48] Great advise, great analogy.
Scott Donald [00:27:50] Hey, everyone, this is Scott Donald, the producer and editor of the show. Just wanted to give you a quick reminder about Greg’s solopreneur financial mastermind community, where Greg helps you, the entrepreneur, stay on top of your financials so that you’re clear on where you stand. You take home more of what you worked so hard for, and you can learn tips and tools from industry experts. To learn more and to sign up for the community please visit our Web site at www.ActionnowCFO.com and click on these solopreneur community page.
Greg Levine [00:28:17] All right. So let’s talk, as you just mentioned, what it takes to succeed and constantly growing is definitely a huge part of it. So tell us, how do you stay on top of things? You have a certain time during the day where you’re you know, you set aside to make sure that you’re learning some new stuff or any sort of other routines that you as the owner and somebody has got to be on top of a big ship as necessary to making you do that successfully.
Frank Cottle [00:28:42] Well, I stay in touch with an awful lot of people, friends, competitors, people in other industries that I know, people around bar industries, shipping service providers, telecom companies, property companies, commercial real estate brokerage people and all that. So we have a network of friends, of course. I think everybody does nothing unique there I do set aside an hour or two a day to study our industry, to try to ferret out things and try and see trends and things and then keep those in mind as I go through my daily routine. Generally, I just try and have a good time, I try and have fun. That may sound a little silly, but if you’re not having fun every day, you’re not going to succeed. We all know that if you’re not doing something you like, you’re not going to succeed so we as a team, we try to enjoy each other’s company. We try to enjoy all the people that we work with throughout the industry. Our biggest competitor is a public company, we’re a private company, is a public company, they’re a very good company they’re based over in Europe. And the CEO and I of that company have become very good friends over the years, go sailing together and hanging out, do things. And even though on the street, you know, our little armies are shooting at each other and I think that, again, being able to work within your industry peers to accomplish common goals to try and elevate the industry at large and not being jealous of anyone else’s success, that’s important to be happy with what you’re doing and do the best you can. Don’t try and say, oh, we’re gonna beat this guy, we’re going to beat that guy. No!, it doesn’t matter who you beat, there’s always somebody who may be somebody bigger, there’s always somebody smaller. Just try and be the best.
Greg Levine [00:30:40] Frank, do you ever sound so even keeled? You ever get stressed, feel pressure? And if so, I’m sure you don’t let it stay there for very long. So how do you deal with that? Because so let’s probably take in and you seem very cool, calm, collected.
Frank Cottle [00:30:53] I to keelen a walk on the beach, I don’t know. I’m very blessed to live in a beautiful part of the world and live on Little Island in the middle of a harbor and that’s so wonderful. So I live in a very peaceful environment. I don’t have it you’re talking about a big boardroom with, big charts and graphs and things of that nature, not really. We all dial into a video system and everybody is where they are and we just pup things onto the screens of our own P.C Or onto a big screen if there’s a few of us in or in the room at the same time but, you know, it’s not a very fancy formal environment that we were in we’re very casual. The way we run the company and the way to be the executive team works but we like, but we’d get stuff done.
Frank Cottle [00:31:44] And so, I don’t know stress, I’m pretty happy guy. I’m not a real stressful person to talk to ten people and they’d say no Frank is pretty mellow. I don’t believe in the stress I just don’t believe in it. Doesn’t do any good, does it do any good? That doesn’t mean you don’t get mad sometimes, it doesn’t mean you’re frustrated at things sometimes. But there’s a difference between something happening and basically pissing you off. And there’s a difference between something happening. And you’re frustrated by that why did we make that mistake? But that shouldn’t translate to stress, that would translate should translate to a discovery or a solution or a new thing to execute on. Stress doesn’t help anything.
Greg Levine [00:32:39] Take action and go away.
Frank Cottle [00:32:41] Yeah, pretty much.
Greg Levine [00:32:44] Oh, well, this was awesome. Such an honor to speak with you and a privilege I’m sure everybody who listens is going to gain a lot from this and so just thank you very much. And before we let you go, though, I want you to plug everywhere people can find anything about you or your company. And so please tell us that and then once you have pulled away, once you give some parting advice to all the entrepreneurs out there listening.
Frank Cottle [00:33:05] Well, for my plug, I’m going to give you three Web sites. The first one is the simplest. ABCN.com, ABCN.com, and the family of the about us, you’ll see a little family of brands and see the variety of different activities and companies that we own and how they operate. The key company that we’re here to talk about today is AllianceVirtualOffices.com, which is our wholesaling structure where we help people to get an office through the hour of the day, the week, the month, the year, companies of all sizes. And it’s very important to the startup community or to companies that are in growth mode all companies about big percentage of our clients of global fortune, 1000 companies, even government. But to us, the most important group of clients are the entrepreneurs building businesses.
Frank Cottle [00:34:01] And then if you just want to learn about our industry and what our industry does, you can go to AllWork.Space, AllWork.Space and that’s a publication that we manage and it’s the largest news and information publication about our industry. And it’s anything you want to know about us competitors, what’s going on, where it’s happening. That’s where you’ll see it.
Greg Levine [00:34:31] And that’s parting advice to all the entrepreneurs out there.
Frank Cottle [00:34:35] With everybody so different. How do you advise one person and get it right for everybody? I think it’s it’s going to go back to, you know, your business. Be that best student of your industry. If you are, then people will come to you seeking your advice and your help you won’t have to be going to others. So just be the best student of your industry.
Greg Levine [00:35:02] Great advice. Well, Frank, this was awesome. Great to meet you, great to speak with you and wish you much success with everything going on. Looking forward to seeing what other countries you guys forge into. So pretty well. All the best to you.
Frank Cottle [00:35:17] Well, this year it’s Africa. So we’ll see how well how far we get. We have a dozen countries, I’m sure.
Greg Levine [00:35:25] All right awesome. Well, everyone, this has been another episode of your personal CFO podcast. Questions, comments, feedback, shumann, e-mail, GregatactionCFO.com or go over on Twitter CFO Greg, or just take us out on the Web site where you can see all previous episodes of the show ActionNowCFO.com. As always, thank you all for listening and we’ll be back next week.
