Preaching to acquire

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Debbie Forster MBE:
Hello and welcome to XTech Podcast by Fox Agency. I’m your host, Debbie Forster MBE. I’m a tech portfolio consultant and an advocate and campaigner for diversity, inclusion and innovation in the tech industry. Today I’m delighted to be joined by Scott Harkey, Chief Strategy Officer and Global Head of Marketing at Endava. Welcome, Scott.

Scott Harkey:
Hey, Debbie. Thanks for having me.

Debbie Forster MBE:
Really great to have you. Now, Scott, we like to, in the audience, get to know you as a human before we plunge into all things tech. And the way we start that is to understand how you found yourself in tech. Some people get there straight away, others wake up and accidentally find themselves. What about you?

Scott Harkey:
Yeah, maybe a little bit of both. So I think there’s probably two main things that led to it for me. One was getting a computer at a fairly young age. I’m old enough that that was a thing, right? Not everyone just had computers by default, so that certainly made a major impact. But I also think my dad was an engineer and just that engineering kind of background and way of thinking about things, trying to find problems and solve problems was a big just theme in my growing up as well. So you combine computers plus the desire to find problems and solve them and you end up in tech, I think is the answer.

Debbie Forster MBE:
Absolutely. Born to it, born to it naturally, it had to come through. And when you did that, I notice on your career there’s an unusual thing, quite often I have people that start in marketing and then end up in tech, but you did it a different way. Walk me through that.

Scott Harkey:
Yeah, it’s funny, I tell my team all the time, my marketing team, that actually I don’t have a background in marketing at all. I kind of just stumbled into it. So I think my whole career I’ve really worked in and around tech, and I always talk about it, is using tech to solve business challenges or business problems. I mean, that’s fundamentally what I’ve done my whole career.

I think the way I got into marketing was a number of years ago I helped or joined an early stage start-up, a consulting agency, and was really trying to help figure out how we build that up and how do we scale it and grow it and all those sorts of things. And just kind of ended up in marketing. It was one of the jobs that needed to be done. I had a general sense of maybe some of the things we could do. I had good people that worked in the team that knew really well the actual tactics to go do, so the real knowledge, right? But I think some combination of still taking that customer lens of if we’re trying to reach specific customers with a specific message, how do we do that? Also, as a bit of a side note, have had a record label for the last 20 plus years.

Debbie Forster MBE:
You’re my first record label mogul. I’m really excited to have that, Scott.

Scott Harkey:
Yeah, mogul is a slightly strong word, but experienced record label owner I will take. But part of what’s been interesting about that journey, and candidly I’ve only really come to realize this kind of lately or recently, is that a lot of that work, so figuring out how to promote a band, figuring out how to get people to pay attention to it, figuring out how to get it in the hands of journalists, figuring out how to get digital media around it. It was marketing. I just didn’t know that’s what it was at the time.

So the reality is maybe it’s not that I don’t have a marketing background. I’ve spent the last 20 years trying to market bands to fans and listeners that maybe want to hear it. And I’ve found that a lot of those tactics, a lot of that understanding of really thinking about how do you reach people with a message actually have been quite helpful in my more recent marketing career.

Debbie Forster MBE:
And that’s what I love working with people is I think it’s always worth looking at the wider CV. Number one, anybody who’s come through start-up, you know they’ve got a wide range of skills because it is all hands on deck. Whoever can figure it out and move forward, do it. But then that is though, it is those side gigs, et cetera, that bring it through. Now, given how much of your day job is now marketing, would you call yourself a techie?

Scott Harkey:
Yeah, absolutely. I think day in, day out, if it’s not work related, and again, a lot of the work that I do is working with customers and lots of conversations about their specific technical challenges, their business challenges, and how we use technology to kind of solve some of them. I spend tonnes of time still researching specific technology, digging into tech, trying to understand it, not just in the space that I work in, but more generally. To the point, one of my business ideas is I want a new tech rental service where I can pay a flat monthly rate and I get access to whatever new gadgets come out. I want the new phone for a month and then I want to turn it back in and I want to get the new watch or I want to get the new whatever it is. I’m not sure how big the audience is for that. Maybe just a few of us that want that, but.

Debbie Forster MBE:
Well, this is your market research, Scott. Ladies and gentlemen, you have heard it here. Scott is claiming the IP there. I will want to cut Scott. All right, we’ll talk to you about terms and conditions later. But here’s your first market research. If you want to join Scott’s new idea and you want to be part of that, try a techie thing, then let us know.

Let me ask you then, because I love looking at stories of journeys and I was really impressed to see that you were Chief Strategy Officer of Levvel, you helped grow the company’s revenue. Now you didn’t 10x it, Scott, you 20x’d it over just seven years, and that obviously resulted in a really successful exit to Endava. What was the secret to that success from your perspective?

Scott Harkey:
Yeah, lots of good people is the first answer, right? It’s one thing to have a role where you’re helping kind of guide and shape that, but clearly without a lot of others in the organization that wouldn’t have been possible. But I think combination of having a really good team and executing. The fundamental thing to scaling any business is you’ve got to execute. You’ve got to do the things you do really well to do more of those things. But I think the other thing that we saw was having a niche and kind of exploiting that to reach people became really important. So being a small start-up, and we were a consulting company, a services company, there’s thousands of others out there that did what we did, right? Lots of them way bigger than we were.

And so we were never going to scale the business by trying to just be louder than everyone. There’s too much others spending way too much money. Part of what we found was let’s focus on a couple of really specific things. So an example was real-time payments was something we latched onto really early. It was a space that was adjacent to the things that we were doing and more broadly in financial services, but it was kind of a new topic, a new idea. Didn’t have a tonne of the big large incumbents really spending time on it. And we doubled down on those particular topics and really being subject matter experts in them.

So making sure that our voice was really loud in a couple of topics or a couple of areas and then using that to drive engagement. So we were actually a really well-known kind of name and brand in very specific spaces, and that was our strategy overall from marketing through how we engage with external customers, et cetera. Pick a couple things, be really good about them and be really loud about how good you are at them. So there was a point in time when you could Google search real-time payments and ours was the first thing that came up in the organic search results. And we weren’t spending any money on that. And at the time we were probably a 50 person company, but Deloitte and Accenture and everybody else was lower down in the page rank, but we were the very first thing and it was just because of investing in that specific idea or concept and really kind of being loud about it.

Debbie Forster MBE:
And that’s something I think we need to be reminded of. Tech is no longer a new industry, and so a whole lot of spaces, unless you are genuinely working with wholly new innovations in tech, you’re working in crowded spaces. And as you say, shouting in that very, very loud party, nobody hears you, but if you start finding out where your battlegrounds are where you can do that talking, you really hear it. So you lived that dream, you 20x’d it, you were acquired. That is the dream. And then actually the real challenge, I hear lots and lots of stories about, “We 10x’d it, we 100x’d it, then we were acquired.” And then they lived happily ever after, the end. And it’s not that is it? How do you hold on to that success?

Scott Harkey:
Yeah, I mean the reality of most acquisitions is it’s like changing jobs. You’re in a whole new business and that business has history and context and people and things. So especially in the area of marketing and go-to market in that space in general, it’s trying to figure out what is the thing that had value that resonated the most with customers in what you had before? So in this case, in the company that we had, what were the things that we were really known for that customers really appreciated? And how do you ensure you don’t lose those when you move into a new organization? And from the acquiring organization’s side, very similar. When you look at an acquisition, you’re doing the smart things to say how does it complement what we do? And you look at culture and you look at all these things, but the actual integration, you have to make sure you don’t break the things that were actually the things that were driving value. Because otherwise, you’ll see the revenue just drop over time.

And it’s not easy. But I do think it’s an intentionality around what are the core propositions or what are the core ways of working or whatever it was that was making that company really work, ensuring it has a home in the acquiring organization that allows that to continue to grow and have that space. I think in our particular example, one of the things that Endava really liked about Levvel, the company that we had before, was the marketing functionality that we built. We had some really good marketing team members that had built out a really robust kind of marketing machine that used creation of content to really drive engagement and things that now everybody’s doing and it’s kind of just normal digital marketing. But at the time it was pretty early in a lot of that and it really built a really nice scalable way of doing that.

And that’s part of what Endava was really interested in, despite the size that we were relative to Endava, that particular function of the business was a standout. So as we came over into Endava, that was a big part of what they highlighted and held onto, and that’s how I ended up in the role at Endava, right? Again, coming from a much smaller organization, but where we had built something that the company saw value in and they were smart enough to find a way to bring it in and let it continue to grow and let it continue to be something. So that’s a big part of it I think.

Debbie Forster MBE:
And I think that’s a big shout-out to a lot of enterprise companies because so many more companies are, rather than build it ourselves, will acquire. And they put so much time and effort into that due diligence for the acquisition, but then it feels like all bets are off, if we build it, they will come. And like you say, they break it. It’s putting as much time and intention into really planning that integration into the whole, not getting it swamped and lost in its value, but bringing the value from both sides. And I think that takes some clarity and strategic vision from the companies being acquired, but it takes actually, I think almost more planning. I’d love companies to spend more time in seeing that as a transformation process rather than, well, we can just plug and play, can’t we? We bought it, we just clamp it on and it’ll all be well.

Scott Harkey:
Yeah, and I won’t posture like we’ve got it completely figured out. It’s always a challenge. But I think one of the things that we do that I think helps is early on in integration, we match a leader with the acquired company with a leader in Endava that’s in the space, that that person or that team is likely to end up. So we don’t know for sure early on exactly how it’ll map in, but you try to align it such that ideally you’re starting to build these relationships where there’s an Endavan leader that has ownership of the success of that particular part of the acquired company’s outcome that orients to the future instead of it just being about like, oh, okay, well you’re here in integration and then suddenly one day you’ll be part of the bigger company. So that alignment of leaders at a human level, that’s a big part of our culture is just this real human focus around let’s think about the experience of the employee, let’s think about the experience of the integrated company and let’s do it at a kind of person-to-person level so that there’s a relationship there.

Debbie Forster MBE:
Completely get that. And that is a golden thread too. I think every episode that we’ve done, great tech, great innovation, great… whatever it is in business, comes from, you’ve got to get that human factor in. You neglect that and everything suffers and you’re always on catch-up or fix mode. Whereas if you can get that human part right, it doesn’t necessarily give you the answers, but it helps you to ask the right questions, make the right plans, and be able to pivot.

Scott Harkey:
Yeah. And it makes it feel better. We all feel better when it feels personal as opposed to just being an amorphous machine.

Debbie Forster MBE:
And it incentivizes in both ways. If I know you as a human, I want to get it right with you. If you don’t know me as a human, if it goes wrong, I shrug my shoulders and say, “Well, I told them so.” It’s about those relationships.

Okay, but we’re going to go deep, as you said, you definitely keep your techie credentials tight, and in fact, you’ve described yourself as a payments nerd. I know that goes down really well in any party situation. So from your perspective then looking across in FinTech and payments, what’s coming? What’s grabbing your interest?

Scott Harkey:
Yeah, well, just one credentialization, right? I’m the guy that goes into the small merchant and I see what payment terminal they’re using, and I’m like, “You know there’s a new version of that, right? That gives you this, this, and this capability.” And they’re like, “What are you talking about? Just buy your pack of gum or whatever. Why are you talking to me about this payment terminal?” But I can’t resist, right? I can’t resist.

I think there’s probably two major themes happening that I see in payments right now. One is real-time payments, and real-time payments is not new, but I guess the effort around trying to drive volume and use cases is in full steam right now. So in the US in particular, RTP is a payment system run by the clearinghouse that came online five, six years ago at this point. So again, not new, but FedNow, run by the federal government, just came online last year and what that’s driving is just there were a lot of banks that were sitting on the fence a bit saying, “I’m not quite sure which way I want to build this.”

Now there’s no excuse. Now it’s here. Banks know what to do. The rest of the market is starting to respond to that, and there’s just a lot of energy around how do we drive volume, how do we drive use cases. That’s working its way into the ERPs and kind of upstream into the systems that businesses use to actually drive their business. So huge amount of work there. Really exciting space. First set of payment rails, new payment rails in 30, 40 years or whatever. So I know myself and a lot of my colleagues in the payment space are just excited about trying to think of ways that can drive additional volume and additional use cases it can open.

Just the other big thing is just open banking and open banking’s impact on payments and other workflows. So again, largely regulation driven right now around the world, different countries are starting to put in place some form of regulation around forcing banks to open up data streams. It’s never straightforward. So that means all kinds of complications about what happens when something goes wrong and who’s got liability. And so there’s a tonne to work through there. But for someone like me, that’s the good stuff. I’m not real excited about operating something. I get excited about figuring out something. And both of those topic areas right now, there’s a lot of figuring out to do. There’s a whole lot of like, “Well, what do we do about it? As an individual organization, what products do we build or how do we position or who do we integrate with?” And that’s just a space that I love to work in so it makes me really excited.

Debbie Forster MBE:
And if I’m looking at that space and listening to you with your insights, we’re hitting that peak of hype curve, it’s really getting driven into everyone’s use. So we’ve got a crowded space. This is now lots of players, lots of questions, lots of people figuring out. Are there any secrets for success if I’m trying to look and make a splash in that space?

Scott Harkey:
Yeah, I would say a couple of years ago there was a lot of trying to build differentiation based on the product’s better. So whether that’s in payment processing or that’s an open banking, it was, oh, we have a better way of solving the problem. I feel like technology has greatly raised that bar where you’d be really hard pressed in any given facets of this to say we have the better answer. It might incrementally better for some period of time, but it’s very easy to quickly outpace that and out-build that. I think the ones that are the most successful are actually the ones that are integrating better with others, the ones that make it easier to combine with some other tool, product, system, et cetera. Because a lot of what we see is that most organizations aren’t buying a single product to answer everything. They’re looking to put together pieces to solve the ultimate problem, and that’ll change over time.

They may go really big into a particular platform today, but then three years from now, they’re looking for no flexibility in that because they have a new line of business or a new use case they want to solve for. So a lot of the buying that we see for products from our customers, a lot of the way we see them thinking about the future state is what’s really easy to integrate with something else? And that is kind of greatly increased in the importance to organizations as opposed to like, “Well, do you do that one thing like 10% better than the other product? Okay, cool. But that’s probably not it.”

Debbie Forster MBE:
A lot of hard work for very little gain.

Scott Harkey:
The one exception I would say to that is organizations that haven’t updated their legacy systems and they’re kind of encumbered by or they’re held back by a lot of antiquated technology that prevents them from moving fast, it prevents them from opening up APIs into different functionality, et cetera. I think they’re in a really bad place because there are so much modern tech stack that’s been built that if you can’t move fast, you can’t deploy code daily, you can’t integrate a new product within weeks, not months or quarters, I think it becomes really, really hard to compete. Tech moves so fast that your technology, your internal tech has to move as fast and be able to adapt to meet your customer needs. And that’s the biggest thing we see with some of the kind of big incumbents in the financial services space.

Debbie Forster MBE:
And understandably, this is a highly risk averse sector, so it’s how do you take the pain out of it, increase the speed, but lower the risks. So I’m hearing, thinking about making, how do you make yourself invisible? How are you integrating APIs, connectivity, or if you want to get in that space, how are you helping those at the back of the queue? How are you helping and how can we smooth that curve? Because if it is becoming now this is BAU for the sector, then there’s a market opportunity for anyone that can try and make that big leap forward more painless.

Okay. All right. Well we’ve heard about your record mogul past, we know about your FinTech credentials. What else in tech? One of the things I love to hear from all my guests is beyond your day job, what on the horizon is capturing your interest, your worry, your concern, or your excitement in tech?

Scott Harkey:
Yeah, so the thing, my honest answer that I almost hate to give just because of how cliche it is to say it at this point in time is AI. And it’s not just because it’s a powerful technology, but I think what really interests me about AI is experiences like sitting down with my mom who I’m trying to explain part of what I do and I’m explaining this ChatGPT thing, and I’m like, “You know, it’s like when you would go to Google and you’d ask a question, but then you have to sort through a bunch of results. It’s like a better version of that, because you can just get an answer.” And I get her interested and before we leave the conversation, she’s got ChatGPT on her phone and now that’s what she uses all the time to research anything. The power of AI in particular, the AI we’ve seen come out in chat form and this new way of interacting with it in a really kind of personal and human way has just been how universally game changing it is for everybody.

You can think of it in the really big picture organizations and tech companies like us, how it’s going to impact us. And that’s a big thing to figure out, is just what does it mean to development? What does it mean to business processes? There’s all of this kind of automation and things that’ll be figured out. But if you even kind of step down to what does it mean at a human level and you think about how much it changes everything, what does education look like in 5, 10 years when you don’t need to memorize anything. You really already don’t need to memorize anything, but we still have a 13-year-old daughter and was working with her last night on homework, and it’s this crazy stuff about sales structure and the science stuff, and I’m like, I understand the exercise, but why do you need to know this? You would never try to remember it. You’d just look it up.

So I think everything from education to our daily lives, to how it plays into work, the jobs of the future, it’s so fundamentally going to change the world that, again, I am a problem solver, so I love just thinking about it and thinking like, “Oh, well what does it mean for that and where’s the opportunity in that or how’s it going to impact that?” I think the most tangible one is in the context of our business. We’re a services business, so a lot of what we do, I would imagine, will be able to be done with technology, with AI and other automation before you know it. So we’ve got to figure out how do we position in that? And we’ve got a lot of confidence in our ability to continue to add value to customers, but the way we do that will absolutely change. It has to change. So that’s a complicated problem to figure out, but that’s the fun and the exciting part of it to me.

Debbie Forster MBE:
Absolutely. And it’s approaching it, I think, in the spirit that you were talking about, is understanding what the risk or threat is. But this is not existential. You can’t approach it as existential threat. You’ve got to figure out what’s the problem, how do we solve it, what are the things that we need to do? And it’s unpacking it in a very pragmatic way. It’s a series of problems to solve that makes it much, much, much more approachable. I mean, I always ask this question, but I’m thinking of a time I may just need to start asking instead of what interests you in tech, is to start saying, “So what about AI is grabbing your interest?” Because at the moment-

Scott Harkey:
I hate giving that answer because again, it’s so cliche, right…

Debbie Forster MBE:
But it is the horizon and it’s back where we used to talk about digital eating the world, AI is. It is this all-pervasive horizon piece and it’s just trying to break it down into what it means and to not buy into the mania of it, but just try to get into that, how do we unpack a piece of that puzzle? I think that’s interesting.

Okay, so last but not least, you survived the session so much, Scott, I’d like to close out with thinking about you as a human. The day of work is done, you’re finished. What is it in your time that you’re reading or watching or listening to that you find valuable that charges the battery for you?

Scott Harkey:
Yeah, so again, I nerd out on payment stuff, but I won’t go back there again, in that I just love reading information and trying to put the pieces together. But I think probably more broadly interesting, I’m also really big into just human psychology and how people think. And it almost feels like a secret to unlocking a next level of understanding if you understand how the brain works and how we process things subconsciously, et cetera. So I think the book, Thinking, Fast and Slow by Daniel Kahneman is one of those for me. I know a lot of people have read it, but it’s one I go back and read every so often just to remind myself of those little tactics and those little tricks and the things for yourself to process as you’re hearing information, but also just in thinking about how you influence others and how you bring ideas forward and those sorts of things. So that’s definitely one of them. But I also think that I can’t escape the conversation without giving a musical recommendation as well.

Debbie Forster MBE:
I thought so. I was just going to say.

Scott Harkey:
Yeah. So I’m going to give two, I’m going to give two. One is the new Finneas album. So Finneas is the brother of Billie Eilish and he works with her on all her, produces all her music, but he also is a solo artist and he has music and he’s got a new album out that is really good. So I would recommend that. And the other one is I’m a big fan of 21 Pilots and they have a new album out as well and I would recommend that. So those are my two musical recommendations for the day.

Debbie Forster MBE:
And you are my first to give us some recommendations, some musical recommendations, so we may have to swing back to you again at some stage.

Listen, Scott, this has been just great. Thank you so much for joining me on the episode of XTech. Now, you’re welcome back any time and I just appreciate you fitting us into your busy day.

Scott Harkey:
Absolutely. Thanks so much for having me. And it’s nice to talk about a different set of things. I don’t usually get to work in my musical side of my journey and experience, so I appreciate the opportunity.

Debbie Forster MBE:
And remember, when your big business idea goes big, it started here. All right? I want to hear about you from there.

Scott Harkey:
It started here. Absolutely.

Debbie Forster MBE:
Thank you for listening. If you’re a tech innovator and would like to appear as a guest on the show, email us now at [email protected]. And finally, thank you to the team of experts at Fox Agency who make this podcast happen. I’m Debbie Forster and you’ve been listening to the XTech podcast.

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