With a business model focused around relationships as their core strategy, Jonathan Morris and Ben Graham have already scored great success with their business TritonExec. Close friends since the age of five, they received the opportunity of a lifetime when they secured a $500,000 contract while operating out of their parents’ dining rooms. Their executive search firm, TritonExec – which specialises in tech, professional services and private equity, based in London with offices in Atlanta and most recently New York, is now winning contracts away from the global ‘big five’.
Executive search: ready for disruption?
In recent years, executive search firms ventured to offer clients more than just head hunting. They now offer practice areas including succession planning, executive coaching, and assessments, among other related services. While the market has evolved, client companies still need a steady supply of talent, at sustainable terms – yet most executive search firms still hold onto the rigid and expensive contractual model. These companies – the ‘big five’ – command more than 90 per cent of the market. The problem with the large multi-disciplinary companies, remains their rigid fee models. The industry norm is to tie in clients regardless of result. They predominantly collect the fee on day one, day thirty and day sixty. Some companies seeking these services may be liable for the full fee at day 60, without any result. This is an expensive exercise for companies seeking to fill £200k+ salaries in crucial leadership roles. So, they move onto the next big executive search firm, with the same onerous fee model in hope of a better luck. Client companies buy these prestigious executive search brands because of their longstanding reputations, but, it’s value which ultimately dictates longevity of these relationships.
Opportunity for TritonExec
Jonathan Morris and Ben Graham – having set up their executive search startups independently in 2011 – decided to partner to service one major client: A global digital transformation business, that gave them their first big break to place 30 executive positions across Europe. Having made a strong impression as a joint venture, they began TritonExec with nothing more than a laptop and mobile phone making calls to candidates across Eastern Europe to build their client’s shared service centre. Quickly, they spotted an opportunity to compete against the big five executive search firms who were proving to be slow and costly.
Having both come from different client service industries prior to executive search, and with only four years experience between them, the entrepreneurs went about their venture, unfazed by obvious challenge ahead.
Value-adding fee model
Their strategy was simple: multi-year agreements with flat retained fees. This negated the usual dips and spikes normally associated with executive search hiring. Clients knew exactly what they were spending, and were able to build trust knowing they were not remunerated as a percentage of their candidate’s salary.
A hard decision at the time was to turn down a significant amount of contingent business, which may have had good fee potential but limitations on achieving long-term client relationships.
With a business model designed to create long term client relationships, this has also had a positive effect on the retention of TritonExec’s employees: While many search consultants know their sectors well, the benefits are the deeper and more meaningful client relations, leading to better candidate evaluation through understanding the company inside out, their culture and journey.
Technology and track record
Within three years of trading, the firm managed to carve itself a niche in this competitive sector. The business embraced technology to predict and uncover subtle trends in compensation, diversity and talent shortages, as well as helping to determine which candidates would be most likely to be successful in a certain organisations. To date, the company holds a track record of impressively high retention rates of 96 per cent within a 24-month period, from placements made to its multinational clients.
American expansion: risk and reward
Morris and Graham were able to expand to the USA in their early years without having a physical presence on the ground. When existing clients across Europe started investing in North America, they reached a point where they had consecutive years of multi-million dollar revenues in the US, and their physical presence became absolutely necessary. However, it wasn’t guaranteed that setting up shop there would automatically work. In 2015, they forged a relationship with Atlanta-based Abe Doctor, who exited one of the big five companies to set up TritonExec’s first US office.
2018: the year of milestones
Apart from opening its second US office, in New York, TritonExec has made significant headway in 2018. Contracts secured for the next 20 months total $20 million, which will mean further hires (including individuals from the big five) and further global offices.
These new assignments are predominantly around digital/tech industries, professional services and private equity. Typical roles include CEO and chairman (in private equity), chief strategy officers, chief financial officers, chief marketing officers, global heads of consulting, chief digital officers as well as service line leaders at SVP level. Many of the tech briefs require ‘digital acumen’ at the highest level.
Private equity assignments brings success
In Q1 of 2018 the private equity practice became the fastest growing area of the US operation – with more than $1.5 million billed in that quarter.
On the strength of private equity, Abe Doctor, commented: “Companies acquiring others through private equity deals are looking to strengthen their new investments with seasoned operators in their markets, so we expect this to be one of our busiest growth areas for a number of years to come. A decade ago, the trend was to buy and sell in a relatively short space of time, whereas we’re now seeing a drive to embrace digital, especially for more traditional industries, as a means of adding value for their eventual resale.
This has been a boon to our digital officers practice which will grow to serve the ever-expanding pool of global companies embracing digital proficiency. ‘Digital acumen’ across these areas of investment for non-digital industries is increasingly important for CEO’s and executive chairmen of private equity portfolio businesses.”
Despite being in business for less than a decade, TritonExec has been able to attract multi-million dollar contracts from early on, and build an impressive client list which includes: Capgemini, Accenture, Deloitte, Icahn Enterprises, Gryphon Investors, and Genpact. The business has grown between 40 – 60 per cent year on year. All eyes, however, are on the US growth trajectory. With two US offices, the 18-month strategy includes expansion to San Francisco (where many of their global clients are headquartered). In addition to expanding to new regions in the US, their growth strategy includes tripling the size of each office (including London) over the next 24 months.
Having recently raised investment from a prestigious UK-based entrepreneur-focused challenger bank, and currently in the process of building a board, TritonExec is looking at multiple ways in which to achieve their ambitious growth plans, both organic and M&A.