Published date: 2022/10
On this week's episode, Dualta is joined by Toby Babb, founder & Ceo of Harrington Starr. Launched in 2010, Harrington Starr are the Global Leaders in Financial Services and Commodities Tech Recruitment with offices in London, Belfast and New York.
Toby talked about using media as a catalyzer for inbound business development, the mindset shift Covid sparked in his businesses, as well as how investing in tech and community can double a company's growth. Listen or read our conversation below. Enjoy!
Find out more on The Recruiter Startup Podcast here.
Dualta: Welcome to the Recruiter Startup Podcast! I'm joined today by the one and only Toby Babb. Third or fourth time on the show. Long time, no see!
Toby: I think third or fourth, always good to be here mate. How are you?
Dualta: I'm really well, I am living in Gibraltar. The last time I was speaking to you was living in my living room and so were you, because we all were in Covid.
Toby: Yeah. Yeah. Good times, huh? That was right at the start of it. I think when we last spoke we were both fairly eyes wide with what on earth goes on here, and we're just trying to sort of console each other about this, if it will be alright or ''God, what's happening?''. But we're still here.
Dualta: We're still here! So, where did this weight loss stuff come from? Did you get on the bike at home then? Was that when it started, or did you do what I did and balloon up with loads of wine?
Toby: That was the first, because it was the tail of two lockdowns, wasn't it? The first one was that you ate the way through it and slowly swell up. And then the second one was - right, let's do something about this and utilize the time to go down a little bit. So yeah, it's been alright, there's some good positives to come out of it after all, isn't it?
Dualta: Yeah, there's something about being -like obviously you're in a panic for sales stuff in that moment- but you can only do so much without pissing off your client base and all the rest. So it, leads you to go ''Well, what else can we do as a business to evolve and improve? And you have to kind of tell yourself this will pass. And, when it does, where do I wanna be? And I remember for us, my biggest panic was how do I keep the long-term team together? Because we knew on the other side of it, it's gonna be super hard. What type of transformations did you guys go through in that time?
Toby: Yeah, it's really interesting you say all of that because you're absolutely right, isn't it? And you know, speaking really candidly, we went into that pandemic probably a little bit flabby as a business, and we've been growing and growing and probably a little bit complacently at various different stages. And despite the difficulties, and I know there was enormous physical and tragic loss for other people through that period, it was kind of, in hindsight, quite a good thing to happen to make it as ship-shape as possible.
Same sort of thing as you go through, metaphorically with ballooning up and then working out that you can be better and improve yourself through it. We did the same thing with the business, so that was a real workout, that period - you look at what muscles you have to work and what you have to improve and where you need to trim the fat and all those sort of things. And it turned out to be a period where it was almost vital to the business and where we wanted to go and where we wanted to take it.
I think we're an infinitely better business in so many different ways now because of what happened in 2020. So when I was there and chatting to you, with eyes wide, we were learning from lots of different people, yourself included, and taking it all through. And I think both you and I have been quite active previously on social and looking at all the things, I know you're a big disciple to Gary V and taking as much as we can out of what you can do with social to create inbound business. But I think what we did at that stage that a lot of people didn't is, is move sales.
So we didn't move sales into just '' Right, we have to pick up the phone more and speak to more people'' - because as you said, people didn't necessarily want that. What we did was treble our marketing team, spend a lot more time and investment, flipped a lot of the business around to be much closer to our customers again.
And to do that we were able to not only grow their teams, but we really focused on growing their brands and grow their networks and being of service and add value. And because we were pushing more and more stuff out, almost immediately more stuff started coming back to us. Stuff that we never would have found, you know, previously or historically.
And now if we fast forward a couple of years on from that, I would say the vast, vast majority of our business is now inbound. We've got rhythms across various different sources of how to engage with customers and our senior people who are very internally facing and are very externally facing. I think in recruitment you quite often have this inverted pyramid where people talk about the ''hands-off leader'' and striving towards being a hands-off leader - and actually what that means is your clients get exposed to your most junior people and your most senior people move away from it.
We wanted to change that and I looked at some of our customers, and I was speaking to all these different leaders on the show, theFinTech focused podcastthat I do, then thinking about what they're doing. They were spending so much time with their customers and being the people who understood them and built those relationships. So we put Nadia to chief customer officer and moved her focus from leadership of teams into leadership of the business and that growth, building the brand and such. James went over to North Star and led that as a CEO in a very similar way - we built in a customer success team and it's been very, very experience led pushing out, which has allowed us to bring people through without that pressure.
We've seen enormous returns from our newer people who aren't having to try and be everything to everyone and doing a much more 180 model. And we've seen the brand now be something that - I love this expression that a client of mine used once when they talked about their software being ''inevitable''.
In financial technology for Harrington Starr and in tech sales for North Starr, I want both of those businesses to be as ''inevitable'' for people to use both as candidates and clients, and ultimately as consultants. If I think back to the other side of that, as a business for our people, we never had any of the flexibility that I know you've been a big advocate of for so many years. We used to have people in there and I thought if our seniors were doing a day a week from home, that was pretty flexible, and I never really trusted it .
And then suddenly you had this thing forced upon you and this hybrid model that we've now got - we've got Belfast that's opened up as a hub for us, which has been exceptional - so almost every single aspect of the business and having much more flexible hours, a much more inbound business, about changing models, about realigning leadership, about investing in various different phases of it all has been completely revolutionary to what and how we've done it.
Dualta: Yes, there's loads to unpack in that! It's interesting because I remember that you were quite forward thinking with media, but in terms of your own model, anytime I interviewed you, you were more ''No, this is what we do, have customer service into this, that's what we do.''
So it must be interesting for people like Nadia, because I can imagine what their job would be managing billing managers who manage billers and it's a repetitive function for years, and all of a sudden you're going, ''Okay, we're gonna shape things differently.'' Her job must be super interesting now.
Toby: Yeah, she's doing an amazing job and she's brilliant. To be fair, she's been absolutely world-class in what she's been doing on effectively landing, expanding, and then making sure that those companies are repeating and referring, and it's a really super focused process.
It seems obvious, but customer success is something that gets used in the software world, which when we think about it, it's so much easier if you're doing business with people you've done business with before. You know, my background was with Sthree for eight years, where it was move out, move in, move out all the way through with some relationships that we built for a long time. But that was embedded into it, and it's difficult to sometimes shake off those shackles after 20 years of reflex action.
Dualta: It's also the financial implications. If we go to what you said earlier that you've doubled or tripled your marketing team, the general consensus is that you have one operational or back office person for every biller. Now you flip that on its head now, so you had to incur a certain amount of cost because somebody's gonna have to get those people billing and make that happen, there has to be a bit of a different way that you're reporting on your results?
Toby: Yes, to an extent. Look, all the headline figures are, what's your revenue and what's your EBIT? And then behind that, it's ''are we getting enough jobs to get enough CVs out, to get enough interviews, to get enough deals?''
Those are the headlines, right? If you think about what we're doing, is pushing those resources into that particular action, moving the phase out where we can get the right jobs to work on. And actually, the other side of it is, we were working a lot of jobs that weren't necessarily fit for the time and effort. It's efficiency now- every bit of action that we're doing, we wanna make sure we're getting return from that, which again sounds like an obvious thing to say, but when you're caught up in the motion of it, you're just busy and saying, '' those are the headline numbers''. Not all 200 jobs are equal, right? You can have 200 jobs and you can place 20% of it. You can have 200 jobs and place 60%, and then you're getting wildly different results off the back of those.
So we unpacked all of that and looked at what good jobs look like, how do we go after that, who are the right people? What do we do about stacking off people there, which are eating our time? And actually, I'll give huge credit over that to James over on North Starr, who was picking up and making sure we pushed our effort into people who respected the process a little bit more. So there's infinite lessons I think we can take out of that.
What we essentially did is we ate a little bit of that cost in that space, but what it did is increase our revenue by- what's been so far this year- about 76%. So if you look at that, you are doing more revenue than you've ever done before, and your costs might be higher than they've ever been before, but the bit in between it, is also twice as high as ever been before. That seems to be a reasonable playoff.
Dualta: Yes it is.
Dualta :If we jump into the podcast that you've ran - my podcast led to creating RecWired with Andy, which means that we've got a thousand founders in and around different groups - it means that if you're hosting the party you're always front and center, if you're in somebody's phone and learning from the community, you get to know people's needs and wants and then you can build solutions based on that. Because of that we've ended up bloating our marketing team compared to the other side of the business - is that something that you find has happened to you as well? Did the podcast lead to more committed customers and building a community?
Toby: A hundred percent. That's been the predominant part of it, and you're exactly right about being front and center. So what you don't do and what I've never done on the podcast is sort of push down the throat that you are a recruitment business and use it as a complete Trojan horse.
You know, I'll speak to people I've never spoken before, create loads of relationships, basically make friends on the shows that we've done, and I never mentioned that - they know who we are and what we do, and we might have a conversation about talent, but I never say ''Right, if you've got any jobs...'' at the end of it.
What invariably happens is that a couple of months later, those guys will come back and say ''We're looking for this, can you help us?''. And that's been the stream of inbound things where it's, if you do the right thing for people and you're creating relationships, you're front of mind.
Nadia does her diversity podcast, and she's written a book which has over 150 people who are quoted in it from her podcast that she's done. She's turned the podcast into a published book by Paul Greg MacMillan by identifying a problem, which is people talking about women within the financial technology marketplaces, and giving a playbook for how people can make themselves more diverse as companies. She's there and now positions as a thought leader, she's been thrown out to Paris, to Amsterdam, she's been asked to speak in online . What happens off the back of that is when people are thinking about diversifying their teams, they'll go to Nadia straight away for advice and then we'll be able to package that up, and we've broken into some of the biggest accounts we've ever had because of that. All that comes from listening to people.
Dualta: You've also done that by freeing her.
Toby: Yeah, exactly, and it's the sort of thing where, as you mentioned before, you just find out so much stuff - for me it's been an MBA. I've been speaking to leaders who are fantastic, they've been investing at Series A, series B, series C. They 're running major international businesses, they've done amazing things through lockdown to double treble their business and move everything further forward, and you can just pick up so much stuff from it. So: A.) I love it and it's great fun, B.) it means your business is front and center in the space, not only from the people you're talking to, but everyone who's then seeing the connections. People recognize me from LinkedIn and it's a bizarre take, you'll know this as well because you've done exactly the same thing and you've learned a lot from it I would wager.
Dualta: Definitely learned a lot and learning constantly. I think because we got into the advisory- Charlotte does the bigger business stuff and I've helped her with the startup stuff - you really get into the nitty gritty problems, and a lot of this stuff is amazing, but I find that mostly it's people aren't professionally trained at the right agencies and they don't have the basics.
With changing the model, how do you still instill that you develop these almost 360 mindset recruiters, even though you're saying it's almost a more of a 180 engagement model?
Toby: Well, this is something where I know you've spoken to Rob a number of different times as well, Rob Grant. He has been critical to all of this- he moved into the COO role at the same sort of time when we first went into lockdown, he was running the US business and you know, repatriated all the way through, which made it very difficult in the States, and he then helped to rebuild that through.
But one of the most important parts there is Rob is a really good antidote to me, my established ''this is how we do it, this is where we go''. He's always prompting different ways of thinking and pushing different areas, and his view was we can be so much more efficient.
So his focus all the way through that, and this has been, I must say, absolutely pivotal to everything that we've done, his position has been to look at every part of the business and efficiency. So that means alongside the marketing side of things, which he runs, we looked at the technology investment. We've made more technology investments than we've ever made before. We asked ourselves, in his words - '' How can we make it as efficient as possible for everyone to be doing their jobs to the max and to maximize their potential?''
Our job as a C-suite, meaning James, Nadia, Rob, myself- it's to go in there and make it as easy as possible for everyone to do their jobs. So going back to the question there, we kept instilling that through the forward thinking aspects of Rob Grant. He's pushed me in terms of flexible working, hybrid working, and technology spending on all aspects of the business. That's fundamentally done it. So if you're listening, Rob, thanks a lot!
Dualta: With Belfast being your test hub- is that done with the view that maybe you could pop forward into Manchester, or Paris, that you could quickly get it up as opposed to going fully remote with one lonely person?
Toby: This is an interesting aspect for me. Everything to me is always people led, right? And I had a phone call from someone, just in that second lockdown period, and they said ''I've got someone who's gonna be great for you, but they're out in Belfast. Would you want to have a chat to them?'' And I said ''Look, nothing to lose''. And I spoke to him, he is great and thought - I really wanna work with this guy, but what I don't wanna do and what I don't see is that longevity, having one person sat on their own, in a seat in Belfast. So what's next for me and how do I move that further forward? With him came another person quickly after that, who worked with him, and then another and another, and soon there'll be 10 people out there very soon. And ultimately I believe that that's the place that could be bigger than London and New York for us, just in terms of the density of talent that we've had.
Dualta:Density of talent- two major universities within a small city, et cetera?
Toby: Yes, really good people. My overwhelming thing of being out in Belfast a number of times in recent months and years, is that everyone whom I've spoken to has just got that natural ability to be a really nice person to chat to, and I think that's an underestimated part of this business at the same time. They're really passionate, they love it as a career. They love the art of recruitment and are fully invested into it.
Dualta: From a competitive standpoint, for every decent biller there isn't 17 very similar top A- grade tech recruitment businesses on the face of it appear very hard to just decipher between it. So you got a real point of difference for talent there as well. It's good.
Toby: And the other thing is I think there's a big advantage for us in Belfast, those guys have been super recruiters who've got the volume, the skill set of having to do multiple placements. Their average placement fee was £4000 - £5,000. They're moving into a space now where they can do the same volume of recruitment but they're doing a £17,500 average placement fee. That's three times for the same activity, they can get paid better than they've ever been and have the opportunity to bill more than they've ever billed before by focusing in the right areas. I think it's a really compelling option for people out there, which is obviously a natural advantage for us at the same time as well.
Dualta: Yeah, awesome. The property's cheap comparatively speaking as well.
Dualta: I was just curious because the natural thing is that things are going go fully remote and I've seen it more with businesses in the Republic of Ireland and America than I have in the UK and Australia to date, which is really, really fascinating. But the UK and Australia are really holding on to keeping hubs of people together, whereas in America, I see people just going for broke with it. But I like your way of doing it with hubs because you're less in danger of them becoming an independent recruiter and not filling their part or something similar to that.
Toby: Yeah, exactly. I think that's a part of it for sure and if I look at the States, there's a couple of compelling reasons for it, right? It's huge, first and foremost. The second side of it is, two of the main places for a similar hub to London are extraordinarily expensive. So it's an extraordinary expensive place to hire people, in New York, California, San Francisco in particular. So if you're looking at those areas, they've got internal offices which are coming through and are throwing ridiculous money at it. So you can put all your time and investment into people and then lose them very shortly afterward.
So if you were to tell me tomorrow that I've got someone in Miami, and I can put four or five people around me in Miami as well, that would make utter sense to me. And if I look on our North Starr business and say we want someone on the ground in America right now to do business development- I'm not really beholden to where that person is in the States at all. But the thing is, what's my story to make sure they can build and grow alongside it and be part of something, because I think that's the intrinsic part. I love the idea of SEAL teams, small crack units that can go together and build and grow out rather than having an enormous spot on army on the other side that move together all in one spot.
Dualta: Do you get a kick out of having to reimagine the business after running it in a certain way for so long?
Toby: Yeah, I mean, what I get a kick out of is doing it, full stop. I love it. I love what we're doing and I think I've been very fortunate to be 23 years into recruitment now and still enjoy it as much as I always have done. I've loved these last couple of years because I love being under that enormous pressure of what was going on, coming out and being better from it. That to me will be one of the things which would be a highlight of my career. People around here at the moment, in the team, and the people I get to work with on a daily basis are just brilliant to be around. So it's fun, you know, and I think if you can go into it loving what you do and embracing the challenge, innovation's right up.
I don't think you have to change things every single two seconds and constantly look for the new silver bullet. But I love the fact that we are a better business now, and I will keep on looking at it and listening to Rob and saying what we can do to improve with it as well.
Dualta: Tell me what's next as we come out of this, what does the future hold for your business?
Toby: We're really excited about where we are at the moment. We're one year into a five year plan that we set up a year ago, which is about 50% year on year growth for five years, which then gives us a position to have a business that we believe will be valued at a significant figure that we've set ourselves to do.
More importantly than that, it's about continuing to move ourselves in the right direction. That's the barometer of whether we're heading into that sort of rope. So within that I think there's three or four areas where we've got real opportunities for growth. Number one is America. And I think we're a team that's rebuilt and in a good position to rebuild a lot further. And we're really excited about the scan and scope of what we can do out there. We've been an 80 to 85% perm business for years and we're really investing into our contract team to level that up a little bit more, which we're excited about.
North Starr is a business which is you know, a micro business at the moment who are doing enormous numbers and some amazing performances within that. We really wanna start to see that grow and develop and take that globally at the same time, and I speak, as the guys are out in Israel at the moment, talking to some clients out there, and we're really excited about the global scale of opportunity within that business as well.
And then I think at the start of next year, we'll be looking to launch another business within the group to allow ourselves to continue to diversify and grow. And there's some exciting planning to be done in the last course of the year about that. So we've got some interesting people who are in positions, take on the next opportunities within it. Loads of organic growth, loads of opportunities for us to take certain areas of the business, which are gold mines, and take them into the next phase of their growth. There's a lot to be achieved.
Dualta: And that business that you're going to launch, when we traditionally look at all you guys who left SThree, there was nothing internally that could have tempted you guys to stay. Like if you look at all the companies, they're all littered with SThree founders. Is that something that you're trying to invest in internally where somebody gets to that point, you're saying - let's build a subsidiary and go after this here?
Toby: I think that's an enormous part of the thing. So if I remember my entry to SThree in 2000, it was probably about 400 people, and it was a private business and we were the 12th company of 13 that were grown. And all those people were people who'd been trainees who moved through the business to get to be MDs of those businesses. And for me, that was tremendously inspiring as a 23 year old first coming into it. And so, when that's effectively stopped after the flotation and the company went public, it was a different sort of story and a different narrative. Because I loved who I was working with, and the story, and succeeding, et cetera - it was a very difficult stage to leave, but it wasn't the same business and it wasn't the same opportunity at that stage. And they gave people the opportunity to go to Holland, or Germany, or America, but I've lived in the same village my entire life and that was never gonna be my story.
So I think it came down to the fact that saying- Look, you've seen a model there that worked really, really well, and I don't need to completely reinvent it to create an opportunity. So I want to create things here where I've got people who will be with us for ages, because we can create opportunities for them to achieve their ambitions. And if they're doing that, they're winning without a load of risk and we're winning at the same stage. So I love that model, I'm really excited about what that does and I'm gonna keep reinventing, creating opportunities so people don't need to go somewhere else to be able to progress.
Dualta: Awesome. That's us today, Toby. Thank you so much!
Toby: Mate, a pleasure as always. Thanks a lot for having me back on!
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