1 00:00:03,840 --> 00:00:06,390 Sean Alymer: Welcome to the Fear and Greed daily interview. I'm Sean 2 00:00:06,390 --> 00:00:10,209 Sean Alymer: Alymer. How about this for a business success story? In 3 00:00:10,210 --> 00:00:15,780 Sean Alymer: 2016, Tristan Sternson sold his data and analytics business, Infoready, to 4 00:00:15,780 --> 00:00:19,970 Sean Alymer: a company that became digital and tech services group ARQ. 5 00:00:20,460 --> 00:00:23,310 Sean Alymer: After a few years away, Tristan came back to ARQ, 6 00:00:23,329 --> 00:00:26,950 Sean Alymer: taking over as CEO in 2019 when the company was making a 7 00:00:26,950 --> 00:00:31,360 Sean Alymer: marginal profit. Now in 2022, he's transformed the business and 8 00:00:31,360 --> 00:00:35,239 Sean Alymer: it's just been acquired for $ 290 million by NCS, a 9 00:00:35,240 --> 00:00:38,280 Sean Alymer: subsidiary of Singtel. It's not bad at all for somebody 10 00:00:38,280 --> 00:00:41,940 Sean Alymer: who started out writing code. Tristan Sternson, welcome to Fear and Greed. 11 00:00:41,940 --> 00:00:45,839 Tristan Sternson: Thanks, Sean. And I should say I still do write code. 12 00:00:46,540 --> 00:00:51,190 Sean Alymer: Do you? So I am absolutely envious of anyone that 13 00:00:51,190 --> 00:00:53,550 Sean Alymer: can write code. Is it hard? 14 00:00:54,400 --> 00:00:58,040 Tristan Sternson: It's like anything. If it's what you do, it's easy. If you're a 15 00:00:58,360 --> 00:01:00,170 Tristan Sternson: footballer, you're good at football. If you're a cricketer, you're 16 00:01:00,170 --> 00:01:02,420 Tristan Sternson: good at cricket, but if you try and cross sports, 17 00:01:02,420 --> 00:01:05,020 Tristan Sternson: it's not always so easy. But it's just a natural... 18 00:01:05,400 --> 00:01:07,690 Tristan Sternson: That's what I've been trained to do. And that's what 19 00:01:07,690 --> 00:01:08,110 Tristan Sternson: I love to do. 20 00:01:09,630 --> 00:01:12,240 Sean Alymer: When you finished school, is that what you went into? 21 00:01:13,110 --> 00:01:16,080 Tristan Sternson: When I finished school, I wanted to get into tech because 22 00:01:16,780 --> 00:01:19,819 Tristan Sternson: I finished back in 1997 and at the time, tech 23 00:01:19,819 --> 00:01:21,259 Tristan Sternson: was a good place to be, and I wanted to be 24 00:01:21,260 --> 00:01:23,959 Tristan Sternson: a business consultant. I did not know a thing about 25 00:01:23,959 --> 00:01:27,830 Tristan Sternson: code and just fell into it at university and found 26 00:01:27,830 --> 00:01:28,170 Tristan Sternson: it quite easy. 27 00:01:29,250 --> 00:01:33,340 Sean Alymer: Right. And do you still find it advantageous even today, when 28 00:01:33,340 --> 00:01:35,470 Sean Alymer: you see stuff going on and you think, " Oh, that's actually 29 00:01:35,470 --> 00:01:36,120 Sean Alymer: a quick fix"? 30 00:01:36,530 --> 00:01:39,000 Tristan Sternson: Sometimes. Sometimes you can also be a bit of a 31 00:01:39,410 --> 00:01:42,110 Tristan Sternson: hindrance on people too, when you say, "I know how it's done. This is how I do it." 32 00:01:43,610 --> 00:01:45,179 Tristan Sternson: I'm not that old where I can say, " Oh, back 33 00:01:45,180 --> 00:01:50,750 Tristan Sternson: in the old days, we used to do it this way," because there wasn't the old days. But in the tech industry, I'm like the 200 year old, because 34 00:01:50,750 --> 00:01:50,971 Tristan Sternson: that's the way the industry moves. 35 00:01:50,971 --> 00:01:55,570 Sean Alymer: Yeah. My old CEO was a journalist and I was a journalist, and the last 36 00:01:55,570 --> 00:01:58,490 Sean Alymer: thing you wanted was a CEO giving his advice on 37 00:01:58,490 --> 00:02:00,180 Sean Alymer: what should be done. Is it the same? 38 00:02:00,490 --> 00:02:02,370 Tristan Sternson: The running joke in our business is I always tell 39 00:02:02,620 --> 00:02:04,580 Tristan Sternson: people I'm the number one coder in the business, and 40 00:02:04,580 --> 00:02:07,660 Tristan Sternson: everyone's too polite to say no, but now, I don't know, 41 00:02:07,660 --> 00:02:08,170 Tristan Sternson: they tell me about it, so it's all right. 42 00:02:10,470 --> 00:02:13,209 Sean Alymer: Okay. Let's get onto ARQ. It's really an exercise in 43 00:02:13,210 --> 00:02:16,460 Sean Alymer: building something fit for acquisition, but let's start with the 44 00:02:16,460 --> 00:02:19,190 Sean Alymer: background. What was the business like when you joined in 45 00:02:19,190 --> 00:02:20,990 Sean Alymer: 2019? How did it make money? 46 00:02:21,400 --> 00:02:26,040 Tristan Sternson: Yeah, so Arq... We go by both Arq and ARQ, but mostly Arq. So we were 47 00:02:26,139 --> 00:02:29,100 Tristan Sternson: a digital services business. It dates back actually 25 years 48 00:02:29,100 --> 00:02:32,450 Tristan Sternson: because it's originally Melbourne IT, who were the first company to bring 49 00:02:32,770 --> 00:02:35,859 Tristan Sternson: domain names to Australia and the internet. So we've always 50 00:02:35,860 --> 00:02:39,660 Tristan Sternson: been the first at everything we do in digital tech, first 51 00:02:39,660 --> 00:02:44,820 Tristan Sternson: websites, first mobile apps, first enterprise data analytics solutions. Always 52 00:02:44,880 --> 00:02:48,299 Tristan Sternson: our business was catering towards that top end, that ASX 53 00:02:48,300 --> 00:02:51,369 Tristan Sternson: top 20, top government departments, et cetera. So coming back 54 00:02:51,370 --> 00:02:55,010 Tristan Sternson: in, in 2019, we'd gone through a branding from Melbourne 55 00:02:55,310 --> 00:02:57,820 Tristan Sternson: IT, which is the business support Infoready, and then changed to Arq in 56 00:02:58,320 --> 00:03:00,900 Tristan Sternson: 2018. So it was actually a new brand for me 57 00:03:01,020 --> 00:03:02,660 Tristan Sternson: to get used to, which was good, and I love 58 00:03:02,800 --> 00:03:06,000 Tristan Sternson: the brand, it's awesome. But coming into an environment that 59 00:03:06,000 --> 00:03:10,419 Tristan Sternson: really needed to focus on enterprise and high end government enterprise, 60 00:03:10,850 --> 00:03:15,859 Tristan Sternson: digital tech, so mobile apps, web cloud data, AIML, all 61 00:03:15,860 --> 00:03:17,820 Tristan Sternson: the cool, fun things that were taking off in the market. 62 00:03:17,830 --> 00:03:21,250 Sean Alymer: Okay. So what were the key changes? So you came 63 00:03:21,250 --> 00:03:23,460 Sean Alymer: in and did you introduce that shift? Was that you that made 64 00:03:23,840 --> 00:03:24,760 Sean Alymer: that strategic shift? 65 00:03:24,990 --> 00:03:28,160 Tristan Sternson: Yeah. No, we were doing that already. The key change 66 00:03:28,160 --> 00:03:30,830 Tristan Sternson: that we made was we had two businesses and they're 67 00:03:30,830 --> 00:03:33,720 Tristan Sternson: now separate businesses. So one's called Webcentral, and that was focused 68 00:03:34,920 --> 00:03:38,260 Tristan Sternson: on the small to medium market, so small businesses, and the 69 00:03:38,260 --> 00:03:42,480 Tristan Sternson: other is Arq. Webcentral sells domain names, sells websites, et 70 00:03:42,480 --> 00:03:45,790 Tristan Sternson: cetera. The business was very much run like a middle and mass 71 00:03:45,790 --> 00:03:50,500 Tristan Sternson: market business, but we were focusing on enterprise customers. So if 72 00:03:50,500 --> 00:03:52,120 Tristan Sternson: we are going out to sell to a really big 73 00:03:52,120 --> 00:03:55,010 Tristan Sternson: customer, I need to be involved in that. If it's a huge 74 00:03:55,010 --> 00:03:57,660 Tristan Sternson: customer, like we want to be talking to the C levels of 75 00:03:57,660 --> 00:03:59,670 Tristan Sternson: the Telstra or the C levels at the bank or 76 00:03:59,670 --> 00:04:02,580 Tristan Sternson: anything like that, we need our partners involved. Whereas in the 77 00:04:02,640 --> 00:04:05,610 Tristan Sternson: middle and mass market business, it's very call center generated, 78 00:04:05,910 --> 00:04:08,620 Tristan Sternson: so you don't get involved in that. And it was run that way. 79 00:04:08,670 --> 00:04:11,370 Tristan Sternson: The executives who ran the business, that was their expertise, 80 00:04:11,370 --> 00:04:14,230 Tristan Sternson: not on the enterprise side. So the changes we brought 81 00:04:14,230 --> 00:04:18,029 Tristan Sternson: in day one was, two things, firstly, the culture of an enterprise 82 00:04:18,029 --> 00:04:22,660 Tristan Sternson: business, and the second one was customer obsession, really getting 83 00:04:22,660 --> 00:04:25,980 Tristan Sternson: out there and talking to your customers. Back to me, 84 00:04:25,980 --> 00:04:28,290 Tristan Sternson: coding, I know how to code, I know what they want. 85 00:04:28,290 --> 00:04:29,960 Tristan Sternson: I want to talk to them about what they need to 86 00:04:29,960 --> 00:04:34,150 Tristan Sternson: do and what they want and understand them in a bit more detail, which the previous executive didn't 87 00:04:34,150 --> 00:04:36,190 Tristan Sternson: have as great an understanding of. 88 00:04:36,740 --> 00:04:44,740 Sean Alymer: Stay with me, Tristan, we'll be back in a minute. My guest 89 00:04:44,740 --> 00:04:47,960 Sean Alymer: this morning is Tristan Sternson, CEO of Arq Group. Okay. 90 00:04:49,360 --> 00:04:54,160 Sean Alymer: So Quadrant, the private equity group was involved. Are they 91 00:04:54,160 --> 00:04:57,480 Sean Alymer: silent partners? I think we all hear about private equity 92 00:04:57,480 --> 00:05:01,630 Sean Alymer: and we often wonder whether they're good or bad. And 93 00:05:01,720 --> 00:05:06,270 Sean Alymer: in this instance, your experience with a private equity owner 94 00:05:06,560 --> 00:05:08,210 Sean Alymer: or majority owner, I believe. 95 00:05:08,500 --> 00:05:08,501 Tristan Sternson: Yeah. 96 00:05:08,501 --> 00:05:08,502 Sean Alymer: How hands on were they? 97 00:05:08,502 --> 00:05:14,789 Tristan Sternson: Yeah. Good question. So I came in as the CEO 98 00:05:14,790 --> 00:05:17,909 Tristan Sternson: of the public company when they were both still combined in 2019 99 00:05:17,910 --> 00:05:20,700 Tristan Sternson: in September, and then we split the companies early in 100 00:05:20,700 --> 00:05:25,580 Tristan Sternson: 2020 and sold them in two directions. I believed in 101 00:05:25,710 --> 00:05:28,360 Tristan Sternson: the enterprise business and I thought, " Well, if there's a way we could own it, we want 102 00:05:28,589 --> 00:05:31,730 Tristan Sternson: to buy that business," so we got Quadrant involved. Because 103 00:05:31,800 --> 00:05:34,839 Tristan Sternson: we were part owners, they were part owners, what we did was we 104 00:05:34,839 --> 00:05:37,479 Tristan Sternson: actually shopped around to all different private equity firms and what 105 00:05:37,480 --> 00:05:39,970 Tristan Sternson: we wanted was a partner that would invest in our 106 00:05:39,970 --> 00:05:42,140 Tristan Sternson: growth, but not try and tell us how to run 107 00:05:42,140 --> 00:05:44,909 Tristan Sternson: our business because we've been doing this for 20 plus 108 00:05:44,910 --> 00:05:48,179 Tristan Sternson: years. We know how to run professional services businesses, and 109 00:05:48,180 --> 00:05:52,290 Tristan Sternson: we knew what a great business it was, so we 110 00:05:52,290 --> 00:05:55,010 Tristan Sternson: want some of their business nous, whereas we had the technical nous, 111 00:05:55,430 --> 00:05:59,970 Tristan Sternson: and combine that together. So you could see plenty of sitcoms on TV and 112 00:05:59,980 --> 00:06:04,410 Tristan Sternson: stuff about very aggressive private equity firms with shiny suits 113 00:06:04,410 --> 00:06:07,190 Tristan Sternson: and young people telling you what to do. This was the 114 00:06:07,190 --> 00:06:10,740 Tristan Sternson: complete opposite. It was a real partnership of their strengths 115 00:06:10,740 --> 00:06:13,409 Tristan Sternson: were helping us put in platforms and financials and stuff 116 00:06:13,410 --> 00:06:16,349 Tristan Sternson: like that, which most of the rebuild was during COVID, 117 00:06:16,350 --> 00:06:19,480 Tristan Sternson: so that was really, really important. But our strength was 118 00:06:19,480 --> 00:06:22,510 Tristan Sternson: running a professional services business, and we worked amazingly well 119 00:06:22,510 --> 00:06:25,190 Tristan Sternson: together. In fact, we keep saying, " We'll miss being a 120 00:06:25,190 --> 00:06:27,320 Tristan Sternson: part." We only had two years to do it. What we could have done 121 00:06:27,320 --> 00:06:29,330 Tristan Sternson: together over a longer period of time. But it's been 122 00:06:29,330 --> 00:06:31,950 Tristan Sternson: a very, I wouldn't say a passive involvement, but it 123 00:06:31,950 --> 00:06:35,120 Tristan Sternson: feels passive. We're running our business. We catch up with 124 00:06:35,120 --> 00:06:38,529 Tristan Sternson: them when we need to, regularly as possible. But really 125 00:06:38,529 --> 00:06:41,339 Tristan Sternson: just where they can influence and focus, they've helped us in 126 00:06:41,339 --> 00:06:41,789 Tristan Sternson: a big way. 127 00:06:42,470 --> 00:06:45,529 Sean Alymer: Okay. Were you always building... A private equity group always 128 00:06:45,529 --> 00:06:49,060 Sean Alymer: needs an exit plan, even when they enter, so obviously 129 00:06:49,060 --> 00:06:51,440 Sean Alymer: Quadrant was looking at an exit plan at some point, 130 00:06:51,500 --> 00:06:53,890 Sean Alymer: three, five, seven years. Was that how you were thinking 131 00:06:54,380 --> 00:06:54,880 Sean Alymer: about it as well? 132 00:06:55,390 --> 00:06:58,540 Tristan Sternson: Yeah. And most importantly, we were telling our business about 133 00:06:58,540 --> 00:07:02,040 Tristan Sternson: it. I've got this notion in the way that I've 134 00:07:02,040 --> 00:07:04,900 Tristan Sternson: run the business of choosing your own adventure, and we 135 00:07:04,900 --> 00:07:06,119 Tristan Sternson: said to the business on day one to our team, 136 00:07:06,940 --> 00:07:09,220 Tristan Sternson: we're like, " Let's choose our own adventure. If we can hit 137 00:07:09,220 --> 00:07:11,770 Tristan Sternson: these metrics, we've got a three to five year exit 138 00:07:11,770 --> 00:07:14,470 Tristan Sternson: point. The closer to the three years we exit the 139 00:07:14,470 --> 00:07:16,680 Tristan Sternson: more of our adventure we get to choose. The closer 140 00:07:16,680 --> 00:07:19,679 Tristan Sternson: to the five years, that's when Quadrant has to exit, 141 00:07:20,080 --> 00:07:22,210 Tristan Sternson: more of their adventure that gets chosen." So we actually 142 00:07:22,210 --> 00:07:24,950 Tristan Sternson: worked through that and we got there even earlier and we chose 143 00:07:24,950 --> 00:07:27,260 Tristan Sternson: the buyer. We went out there and we were very 144 00:07:27,260 --> 00:07:29,430 Tristan Sternson: specific on what we wanted for the business in the 145 00:07:29,430 --> 00:07:34,580 Tristan Sternson: next incarnation. And every single person in the business is 146 00:07:34,580 --> 00:07:37,140 Tristan Sternson: really happy about it because we chose that adventure for ourselves, 147 00:07:37,440 --> 00:07:39,150 Tristan Sternson: and we worked towards that. We knew if we got 148 00:07:39,150 --> 00:07:42,270 Tristan Sternson: there in the three- year timeframe, we could almost build. 149 00:07:42,770 --> 00:07:46,180 Tristan Sternson: We'll take Arq into NCS and it will be NCS 150 00:07:46,180 --> 00:07:49,960 Tristan Sternson: Arq in the business. And it's amazing, we can retain what we've built and we 151 00:07:49,960 --> 00:07:52,410 Tristan Sternson: become their significant component in Australia. 152 00:07:52,890 --> 00:07:57,930 Sean Alymer: Okay. Now I've got to take you back. You chose the buyer. How do you choose 153 00:07:57,930 --> 00:07:59,810 Sean Alymer: the buyer and get the price you want? 154 00:08:00,230 --> 00:08:03,280 Tristan Sternson: Yeah. So we knew the types of buyers that we wanted 155 00:08:03,360 --> 00:08:06,140 Tristan Sternson: and I've known NCS for a while. They're an amazing 156 00:08:06,140 --> 00:08:09,150 Tristan Sternson: business with a very small footprint in Australia, and they're 157 00:08:09,150 --> 00:08:11,730 Tristan Sternson: almost the equivalent of us, but in Singapore and in 158 00:08:11,730 --> 00:08:16,230 Tristan Sternson: Asia. And I wouldn't say our dream, but our aspiration 159 00:08:16,230 --> 00:08:19,490 Tristan Sternson: was to be part of a business that just wanted our Australian component 160 00:08:19,490 --> 00:08:22,370 Tristan Sternson: to grow with and not gobble us up into a 161 00:08:22,370 --> 00:08:26,870 Tristan Sternson: bigger organization. So we approached them initially and we'd been 162 00:08:26,870 --> 00:08:30,780 Tristan Sternson: having conversations over a period of time, but I approached 163 00:08:30,780 --> 00:08:33,840 Tristan Sternson: them, and worked with Quadrant on this too and said, " 164 00:08:33,940 --> 00:08:36,679 Tristan Sternson: Look, if we can get a competitive price, so the 165 00:08:36,679 --> 00:08:39,480 Tristan Sternson: fair price for the business off the people that we want to 166 00:08:39,480 --> 00:08:41,770 Tristan Sternson: sell to, what would that look like?" And it made 167 00:08:41,770 --> 00:08:44,610 Tristan Sternson: it a lot more complicated than we would expect, but it worked 168 00:08:44,950 --> 00:08:48,170 Tristan Sternson: really well, and that's why we were very happy. So we actually went 169 00:08:48,170 --> 00:08:50,329 Tristan Sternson: out and said to them, " Look, we're going to run a process 170 00:08:50,330 --> 00:08:53,890 Tristan Sternson: soon. How would you like to be involved in it?" 171 00:08:53,890 --> 00:08:55,709 Sean Alymer: And did you run the process? Did you have other 172 00:08:55,710 --> 00:08:56,439 Sean Alymer: potential buyers? 173 00:08:57,059 --> 00:08:59,670 Tristan Sternson: We had other potential buyers. We never ran a full 174 00:08:59,670 --> 00:09:02,700 Tristan Sternson: competitive process in the end because we didn't need to. NCS 175 00:09:02,700 --> 00:09:05,970 Tristan Sternson: put down a really good, fair price on the table 176 00:09:05,970 --> 00:09:09,030 Tristan Sternson: on day one and said, " This is what we can do if 177 00:09:09,030 --> 00:09:11,300 Tristan Sternson: this all holds up and we work through all the semantics 178 00:09:11,300 --> 00:09:15,130 Tristan Sternson: behind it," and it worked out really nicely. So they met 179 00:09:15,280 --> 00:09:18,170 Tristan Sternson: the commercial, but we probably would've got the competitive process. 180 00:09:19,110 --> 00:09:21,950 Tristan Sternson: There's been a lot of market sales and trade sales around, 181 00:09:21,950 --> 00:09:24,650 Tristan Sternson: so we can compare to those. In fact, what we 182 00:09:24,650 --> 00:09:27,390 Tristan Sternson: didn't know was they were actually doing acquisition of another business at the 183 00:09:27,390 --> 00:09:30,370 Tristan Sternson: same time on a different part of technology to we are, so 184 00:09:30,820 --> 00:09:33,610 Tristan Sternson: very complimentary and just looking at their price goes to show 185 00:09:34,790 --> 00:09:37,160 Tristan Sternson: that they are fair value, so we didn't need to run that 186 00:09:37,160 --> 00:09:39,969 Tristan Sternson: process. But we were approached quite a bit by a 187 00:09:39,970 --> 00:09:42,590 Tristan Sternson: lot of organizations who were interested to take us forward. 188 00:09:43,809 --> 00:09:46,439 Sean Alymer: Clearly you have a business which is in demand, and 189 00:09:46,550 --> 00:09:49,900 Sean Alymer: so when that's the case, you can pick your fun. 190 00:09:50,020 --> 00:09:52,580 Sean Alymer: You pick your adventure in a sense. So this was 191 00:09:52,580 --> 00:09:55,910 Sean Alymer: in March, this happened. What's next? How do you work out 192 00:09:56,300 --> 00:10:01,209 Sean Alymer: how to integrate the businesses? My involvement in this sort 193 00:10:01,210 --> 00:10:05,329 Sean Alymer: of thing has always involved redundancies and finding the right 194 00:10:05,600 --> 00:10:08,750 Sean Alymer: jobs for the right people, retraining, all that sort of 195 00:10:08,750 --> 00:10:10,140 Sean Alymer: thing. Is that where you're up to now? 196 00:10:10,450 --> 00:10:15,260 Tristan Sternson: Actually the opposite, because we're a booming business, putting on 20, 30 people 197 00:10:15,260 --> 00:10:19,590 Tristan Sternson: a month minimum. So we're growing. So because we're the 198 00:10:19,590 --> 00:10:23,640 Tristan Sternson: Australian component of their digital business, which is actually called 199 00:10:23,640 --> 00:10:26,900 Tristan Sternson: NEXT, funnily enough, so we will continue to grow in 200 00:10:26,900 --> 00:10:29,390 Tristan Sternson: Australia and we'll just continue to retain that. But the 201 00:10:29,390 --> 00:10:31,090 Tristan Sternson: one thing that's exciting is we'll actually get to put 202 00:10:31,100 --> 00:10:34,810 Tristan Sternson: more people into global roles. So some of our team, as 203 00:10:34,870 --> 00:10:37,559 Tristan Sternson: these two businesses together will grow at an exponential rate, 204 00:10:37,710 --> 00:10:40,429 Tristan Sternson: gives more opportunity to our staff to step up. So 205 00:10:40,429 --> 00:10:43,230 Tristan Sternson: it just means probably hiring more people rather than the 206 00:10:43,230 --> 00:10:48,010 Tristan Sternson: opposite. When businesses integrate, typically they have two finance teams, 207 00:10:48,010 --> 00:10:49,990 Tristan Sternson: they have two HR teams, they have two of everything 208 00:10:49,990 --> 00:10:53,610 Tristan Sternson: and then they have to make redundancies for that. Given that we're the only 209 00:10:53,610 --> 00:10:56,410 Tristan Sternson: component in Australia that is that part of the business, 210 00:10:56,410 --> 00:10:58,470 Tristan Sternson: the Arq part of it, we don't have to do that at 211 00:10:58,470 --> 00:11:02,470 Tristan Sternson: all. It's more the integration of looking at other parts of their business. We have bought a few 212 00:11:02,470 --> 00:11:05,120 Tristan Sternson: businesses over the past, so we're going to integrate them into 213 00:11:05,120 --> 00:11:09,100 Tristan Sternson: Arq and into their business, NEXT, in Singapore, and work 214 00:11:09,100 --> 00:11:13,210 Tristan Sternson: that all together. So I like to think of it as a bit of a merger on those two businesses 215 00:11:13,210 --> 00:11:17,540 Tristan Sternson: rather than an acquisition. Although they bought us, so it is the acquisition on 216 00:11:17,920 --> 00:11:18,081 Tristan Sternson: that side of the business. 217 00:11:18,081 --> 00:11:23,819 Sean Alymer: Yeah. Just in preparing for this discussion, you've spoken a bit 218 00:11:23,820 --> 00:11:28,480 Sean Alymer: recently about boomerang employees. It's a really interesting concept, businesses rehiring 219 00:11:28,800 --> 00:11:32,100 Sean Alymer: former workers, and that's happened at Arq, is that right? 220 00:11:32,100 --> 00:11:33,309 Sean Alymer: Why does that happen? 221 00:11:34,100 --> 00:11:38,370 Tristan Sternson: Yeah. So it's two parts to that. So during the COVID period 222 00:11:38,370 --> 00:11:43,099 Tristan Sternson: particularly, a lot of people left and we've heard a lot of market terms 223 00:11:43,100 --> 00:11:46,660 Tristan Sternson: around the Great Resignation and people leaving and stuff. It was really, really 224 00:11:46,660 --> 00:11:48,480 Tristan Sternson: easy to leave your job in the last two years. 225 00:11:48,480 --> 00:11:50,970 Tristan Sternson: In the first year of COVID because of job stability and everyone 226 00:11:50,970 --> 00:11:53,210 Tristan Sternson: was worried about what would happen, and the second year 227 00:11:53,210 --> 00:11:56,280 Tristan Sternson: because once they got beyond that in digital tech, it was like 228 00:11:56,280 --> 00:12:00,450 Tristan Sternson: there's huge tech skill shortage, and how do people get other 229 00:12:00,450 --> 00:12:02,640 Tristan Sternson: jobs? And everyone was in high demand. Like our business is in 230 00:12:03,040 --> 00:12:05,959 Tristan Sternson: high demand, a lot of our people are as well. So what would 231 00:12:05,960 --> 00:12:09,120 Tristan Sternson: happen is they could change jobs by literally just signing 232 00:12:09,120 --> 00:12:10,809 Tristan Sternson: onto a new company. You get a new laptop, a 233 00:12:10,809 --> 00:12:13,620 Tristan Sternson: new t- shirt, a new hoodie and you work on a similar 234 00:12:13,620 --> 00:12:16,360 Tristan Sternson: account. So what we found is when people do that, they've done 235 00:12:16,360 --> 00:12:19,140 Tristan Sternson: it for the money and then they've come back and they've 236 00:12:19,140 --> 00:12:22,030 Tristan Sternson: found that the grass isn't any greener and that companies 237 00:12:22,030 --> 00:12:25,070 Tristan Sternson: still have cultures, companies still have operating models and ways 238 00:12:25,070 --> 00:12:27,300 Tristan Sternson: that they operate. So we found that people have come 239 00:12:27,300 --> 00:12:30,570 Tristan Sternson: back during that period particularly, and we call them boomerangs. We also 240 00:12:30,570 --> 00:12:33,600 Tristan Sternson: encourage people sometimes to go and get different experience. So 241 00:12:33,600 --> 00:12:35,830 Tristan Sternson: while we're really good at coding, if you work in 242 00:12:35,830 --> 00:12:39,690 Tristan Sternson: financial services or you work in retail, if you're a 243 00:12:39,690 --> 00:12:44,240 Tristan Sternson: retail expert in technology, there's nothing better than working in 244 00:12:44,240 --> 00:12:46,640 Tristan Sternson: the actual customer for a period of time. And sometimes you 245 00:12:46,640 --> 00:12:49,150 Tristan Sternson: get that through consulting, and sometimes people physically want to 246 00:12:49,150 --> 00:12:51,679 Tristan Sternson: work for that customer for a period of time. So they go 247 00:12:51,679 --> 00:12:54,210 Tristan Sternson: out, they get this experience and we welcome them back because they've got 248 00:12:54,210 --> 00:12:57,100 Tristan Sternson: more experience than they had before they left that we 249 00:12:57,100 --> 00:12:59,030 Tristan Sternson: couldn't have given to them because a different type of 250 00:12:59,030 --> 00:13:02,400 Tristan Sternson: experience. So we're finding it more and more so that people 251 00:13:02,400 --> 00:13:05,410 Tristan Sternson: are leaving and then they're coming back because they're attracted to what's 252 00:13:05,410 --> 00:13:08,070 Tristan Sternson: important at the moment is culture because you can get money anywhere. 253 00:13:08,320 --> 00:13:11,329 Tristan Sternson: Now it's all about the cultural aspect of the business and what they 254 00:13:11,330 --> 00:13:11,650 Tristan Sternson: stand for. 255 00:13:12,520 --> 00:13:14,950 Sean Alymer: Can you find enough people at the moment, Tristan, given 256 00:13:14,950 --> 00:13:16,270 Sean Alymer: the skills shortage? 257 00:13:16,530 --> 00:13:18,770 Tristan Sternson: You can, if you look in the right places. So what we 258 00:13:19,470 --> 00:13:21,650 Tristan Sternson: do is we have a thing we call Arq Academy, 259 00:13:21,780 --> 00:13:26,300 Tristan Sternson: and Arq Academy is about building up people who are 260 00:13:26,300 --> 00:13:29,990 Tristan Sternson: either graduates, job re- skillers, so they're reentering into the 261 00:13:29,990 --> 00:13:34,270 Tristan Sternson: market or they've been an accountant, a lawyer. We've had 262 00:13:34,360 --> 00:13:37,450 Tristan Sternson: construction workers, we've even had, up in New Zealand government 263 00:13:37,500 --> 00:13:40,920 Tristan Sternson: last year, we had people that were coming from working in scrapyards and 264 00:13:40,920 --> 00:13:43,670 Tristan Sternson: farmers and stuff like that. So all different industries that have 265 00:13:44,220 --> 00:13:47,010 Tristan Sternson: an ability to work in the tech space because everyone does 266 00:13:47,010 --> 00:13:50,270 Tristan Sternson: something technical nowadays. So we skill them up in the 10- week 267 00:13:50,270 --> 00:13:53,380 Tristan Sternson: bootcamp. So rather than trying to compete with the very, 268 00:13:53,380 --> 00:13:56,620 Tristan Sternson: very skilled people that are pushing rates up considerably, actually 269 00:13:58,040 --> 00:14:01,160 Tristan Sternson: last year, we hired I think 50 of our own, 270 00:14:01,160 --> 00:14:03,640 Tristan Sternson: and I think about 10 to 20 for our clients. 271 00:14:03,910 --> 00:14:06,890 Tristan Sternson: This year we'll do about 60 and we've got a customer who's going to take about 272 00:14:06,900 --> 00:14:10,150 Tristan Sternson: 100 on top of that. So we're actually training people, 273 00:14:10,270 --> 00:14:13,630 Tristan Sternson: like old school, teaching them the skills in a bootcamp 274 00:14:13,630 --> 00:14:16,220 Tristan Sternson: and then getting them onto projects and working through that. That's 275 00:14:16,220 --> 00:14:18,439 Tristan Sternson: how we find skills. A lot of people will complain 276 00:14:18,440 --> 00:14:22,700 Tristan Sternson: about border closures and all that sort of stuff, attracting skills. Even with 277 00:14:22,700 --> 00:14:24,760 Tristan Sternson: that opening, we're not going to get enough people unless 278 00:14:24,760 --> 00:14:27,970 Tristan Sternson: we actually build the skills ourselves, so that's our unique approach to it. 279 00:14:28,300 --> 00:14:30,680 Sean Alymer: Fantastic. Tristan, thank you for talking to Fear and Greed. 280 00:14:31,190 --> 00:14:31,420 Tristan Sternson: Pleasure. 281 00:14:31,420 --> 00:14:37,310 Sean Alymer: That was Tristan Sternson, CEO of Arq Group, ARQ. This is the Fear and 282 00:14:37,310 --> 00:14:39,670 Sean Alymer: Greed daily interview. Join us every morning for the full 283 00:14:39,670 --> 00:14:43,070 Sean Alymer: episode of Fear and Greed, Australia's most popular business podcast. 284 00:14:43,290 --> 00:14:44,870 Sean Alymer: I'm Sean Alymer, enjoy your day.