Lessons Learned From Business Partnerships, Chat with Philippe Fruchet

Yasi: Welcome to the Fast Track podcast, Philippe.

Philippe: Thank you for having me.

Yasi: I’m so interested to know your personal story because you founded several companies in the past and you’re working in so many different emerging countries, I guess your experiences were unique. So, let’s start with the first question about you.

Tell us a little bit about yourself and also your international footprint.

Philippe: Yeah. My name is Philippe, I’m French. I’m currently based in Amsterdam, in the Netherlands. And, my father is French, but my mother is Chilean. So I grew up in a bit of a multicultural environment, and my dad was an ex-pat, working in oil.

So when we were young, we also lived in different countries like Nigeria, Italy, and Norway. So I guess, yeah, at a young age, I sort of got a bit of the multicultural vibe, and I kind of liked it. So when I eventually finished high school, I also went to study abroad. So I studied in Ireland, in Dublin.

And then, yeah, I’ve been abroad ever since, so really like different cultures, different backgrounds

Yasi: And the thing that you are born in a multicultural family, do you think that contributes to your adventurous spirit or is just part of you, as part of a character?

Philippe: Yeah, I think it helps to get a taste for different cultures.

So that’s true. Then I think it’s also a personality thing. So, for example, my brother had the same uprising, but he’s much more centered in France. So I think it’s also nice that the family gives you a view, but then you have to grow and develop an appetite, I think, for it.

Yasi: And for the audience, you might not know that Philippe and I met several years ago in Amsterdam from our previous job. And I remember like five, six years ago, you briefly mentioned that you’re starting a company. And could you tell us how did you start this journey from being employed to start your own company?

Philippe: Yeah. Always in the back of my mind, since I was in business school, I had the idea that it would be nice to at least once in my life try to set up a business on my own.

I didn’t know how; I didn’t know when. What I did know is that first, I wanted to build some experience so that I had the understanding of how business works to be able to have a foundation to create something. And then it didn’t start as a very reasonable idea it’s not that I said, okay, now I have the perfect business plan and go in and create the company.

But it was very much, I would say, a spur of the moment. I grew frustrated within the role I was in the corporate world and decided I had enough. So, I couldn’t go forward with what I wanted to do. And then I said, well, better to stop and try to figure out what it is that I want to do and where I want it to go.

So it’s maybe not the normal path, I get, more people have ideas, and they only leave and grow once they’ve figured out where their ideas look like. For me, I just wanted something different. I didn’t know. I know exactly why. And I thought, well, let’s stop with what I’m doing and, and let’s take the time to figure out what it is I want to do.

And yeah. So then, that, of course, leads to a journey that’s not necessarily a straight line into getting there, the business that will work or be sustainable. So actually, I first started this company as sort of a base. In the Netherlands, it’s very easy to set up a company.

You can basically set it up in four to five days with 400 euros for notary costs and one euro for capitals. So that was very easy, so I first set up the one that was for me. And then, I first partnered with an American guy, and we set up a media company, it was called So Damn Creative.

A bit of a strange name. But the idea was to make videos, marketing videos for different clients. And this guy had a background in video production, then I said, okay, let’s set up a company, let’s go 50–50 on that business. And then let’s try to find some clients. The first client was the government of Rwanda.

They were coming to the Netherlands for like one of their yearly conferences or not yearly, but every now and then, they have gigantic conferences for all of their experts in Amsterdam. And then we ended up making the production of the video, we had a crew and everything for them, which was very stressful because I had no idea what we were doing. Eventually, it went quite well, but then subsequently, we had another gig, and I realized quite soon on that this partnership was not going to work. So we were just very different people, very different characters.

And even if there was potential for the business, there was just no possibility of us continuing to work together. So after maybe two and a half months, I sold my shares to him and said, you know, you can keep the business, that’s not the right thing for me and let’s move on. So that was the first fast fee

Yasi: From that, what do you think you learned from it in terms of finding the right partner? What do you think is the advice for our audience if they want to start a business with partners?

Philippe: Yeah, some people say that the, you know, starting a company is like a marriage it’s even harder than marriage.

I’ve learned that you need to spend more time thinking about what the different partners in that marriage want. I was a bit naive, and I really jumped into it, believing that everything is going to be all right and we’ll figure things out as we go. And there were already some signs that maybe we had some issues that we needed to address.

I’d say before you jump into it, think about what you’re going to get with a partner, how they both are going to contribute to the business together. Are they going to be equal in the contribution continuously? Are there going to be differences? If so, how can you account for it in the structure, in the shares, or in the way of doing things?

So yeah, the first try wasn’t successful. But then yeah, you learn about spending more time thinking upfront about what you want from a partner, and finding the right partner is actually quite difficult, I think much more difficult than I thought, which is actually why now I don’t have a partner anymore.

So I’m a hundred percent on my own in this business.

Yasi: And you were in the corporate world, you mentioned that you grew very frustrated about it, but I’m sure also you learned a lot from it because you are part of this corporate talent pool. They’re supposed to rise up the corporate ladder.

How do you think your learnings from that period compared to being an entrepreneur? What are the main differences?

Philippe: Yeah, I definitely learned a lot of stuff. I think before I answer your question, maybe a word about the double-edged sword of the term being a talent. I think that in companies, it’s a bit two-sided, the risks from that because you, as a talent, expect things to happen.

So your expectations are not always correct. And on the other side, the business expects different things from you. So I think it’s a good thing, but it can also be a bad thing.

But then to your question. Yeah. I learned a lot. I learned most of the things that I’m using now in my consultancy from the business, how to manage projects, how to communicate with different stakeholders, how to navigate discussions to get to an outcome.

But I think the really big things for me is Passion for the emerging markets, so thanks to that job basically, I got to work with people from all over, particularly Africa, the African continent, and really opened my eyes to a different world, but also into the possibilities that you have in more emerging markets to really make a difference in what you bring to work. So basic things that you can structure, you can really see relatively fast an impact on what you’re doing. And I find that quite nice because sometimes, particularly in more developed countries, you might be doing a really small thing of which the impact is not always very clear. It’s less organized, of course, but you have a much, much bigger opportunity to contribute and to see the results of your contribution.

So that’s definitely something that I got to experience from work. And I also think the technology part. So my last role was also as a product owner for one of the solutions of the company, and I really had to work with developers, understand better and how to think in particular with digital is about to rethink how a process did exist in a certain form can exist in a different way by leveraging what tools are now available that weren’t there when those processes were designed.

So, a lot of exciting things I got to learn of course in the job and that I’m still using and applying, sometimes perfecting into what we do now.

Yasi: Interesting. You mentioned that what you have learned from the corporate, and you can use that in your current entrepreneurial journey, but also before you mentioned that after you first did worse. And then you started this company that you fully own yourself. What happened in between? How did you come up with this business idea? How did you start at this?

Philippe: Yeah. So, actually, there was also another company in between the two parts of the story. So I made a first media company, and then the second one. Basically, we had an ex-colleague from work who was looking for a service that was similar to what would the things we’d done before it was for Tanzania, and they wanted to do market research, and then they wanted the consulting, but also the application to collect the information. So our company TC insight basically has an application that allows you to collect data in emerging markets and be able to manage the process. So within that application, you can also manage the quality and eventually connect to reports for insights on whether you’re managing the project itself or eventually getting the strategy out of it.

And then they were like, okay, in two months, we want to run this project. So, can you come and work with us? I think that was the question. And so eventually I was like, okay, well I have two months to build an app that we’ll be able to do that. So I knew the process, I knew exactly what the app needed to do because I’d done that with multiple partners before.

But yeah, I didn’t know exactly where to go and how to do it. So, I found a developer agency here in Amsterdam. We had worked together on a small project before, and I said, okay, guys, do you want to partner up? And I didn’t have sufficient capital at the time to pay for the full value of the application.

So then we made a deal. I mean, if I go back in time probably will make a different deal now, but we made a deal that they would get shares in the company, but I would still retain a majority shareholding, and then they would pay some of their work through the shareholding. And that’s how the company TC insight was born.

Which was basically the software part of the consulting. So the consulting was always in the other company- CSD and the application in TC insight. Now, even though I had learned from my previous marriage, the second marriage lasted longer. But unfortunately, I also ended up in a separation.

Yeah, this was from what I mentioned earlier. It’s like I hadn’t foreseen that there would be an unbalance in the investment of time into the work and the reward that you would get from that work. And eventually, that imbalance just created a lack of trust or issues we couldn’t really resolve in a way that was satisfactory, at least not for me. So then that took on a long process of trying to buy them out. About a year and a half ago, I bought them out. And now, I basically own these two companies.

Yasi: What is the decision to buy them out, is it because it’s the software part of your debt business is complementary to each other?

Philippe: Yeah. The application, of course, is necessary to run those projects, but yeah, the reason to buy them out was really to have more freedom in how to develop the proposition, not only the technical part but also what type of service I wanted to offer the clients.

Just to make it a bit concrete down. So basically, the idea was that we have different services. So maybe you just take the app service, maybe you just take the project management, and maybe you just take the consulting. And I wanted to be able to offer the full package to say, okay, well, you tell me what you need, and then we’ll go and find the partner who will do the fieldwork. We’ll manage them, we’ll contact them, basically, we’ll do everything for you. And then I didn’t feel that with them in the partnership, I would be able to set that up in the way that I wanted without having a lot of conversation, you know, in a marriage.

And when it’s your child, you want to be able to discuss how you’re going to grow it. Yeah. I just want it to go and get on and do it, you know, so I was always very clear of what I wanted to do. I was very clear on how I wanted to do it. And I saw our relationship as slowing down things, and basically, having to bring them on boards was not really adding value to the process and to the service.

So, yeah, I thought, well, let’s try to find a way to get that out in terms of issue and then move forward with the new way of working

Yasi: And how do you find starting your own company and running your own company versus working a full-time job?

Philippe: I think, as you probably know as well, it’s a different, a different world.

One is to set up more work. You become all the departments of the company into one for quite a period of time. And it’s more personal. So when you’re working for an employer, you can be passionate about what you do, of course. But if things go bad or if things are not exactly going as planned, you know, it’s not dramatic for you personally, you know, it’s nothing that, I mean, you can be emotional, but it’s not the same as when it’s your own company, then everything becomes more personal, and that’s something I didn’t anticipate, I think basically you’re every day putting yourself out there, and things that go well, of course, are also more rewarding. But when things go sour, then it’s more personal. It’s harder to deal with, I think. But of course, both of them go hand in hand.

Now you get more reward, more energy. And when things go well, and yeah, you get more impact on your personal life when things don’t go well, I guess probably feeling the same on your side.

Yasi: Yeah. Sometimes I feel I cannot stop working and I know it’s not healthy because when you go to a job, you finish nine to five, you go home.

And then the project rounds, I mean, there’s always a timeline, but for your own stuff, you want to get it down as soon as possible in the best way possible. And basically, if someone has a very high standard, it’s just going to be difficult.

Philippe: Yeah, I fully agree. So for the same issue, and particularly when it’s something that you’re doing, you do want it to be as good as you can get it.

Right. So it’s not that you’re saying, ah, yeah, let’s just do this. It’s sufficient. Right? Whereas I sometimes think in the corporate is easier to say, well, you know, this is sufficient for what we have, but sometimes you’re like, okay, but this is not good enough, you know?

And then the next thing, you know, you’ve gone down the rabbit hole, and you’ve been spending hours on something just to make it perfect. So yeah, I think that finding the balance between work and time off and what is sufficient is always something to think about or at least to keep in mind and try to balance, I think,

Yasi: Yeah, is there a way that’s for you to decide okay, this is good enough, let’s move on? How do you balance the speed and the quality of the output?

Philippe: Yes. Sometimes when you have timelines, as sort of get it done for you. And so you sort of have to stop at a certain point. Particularly now that we have a bigger team now, I’m trying to look at the investment versus the return, you know, and investment and return can also work for an individual. If I’m going to spend 10 hours on this versus spending 10 hours on finding a new client, for example, will it be worth it, you know? So more and more now, particularly with a bigger team, you have to think about, okay, well, if that person spends more time there, is it really going to be better for the service that we’re giving?

Will the client, you know, reward us more for what we’ve done and invested, in which case the investment is worth it. Or you know, is it better that we give what we’re supposed to deliver, it works, it doesn’t, but let’s invest that extra time into something either for the business or for developing the company in a different way.

So I guess that’s how you have to try to structure it in a way.

Yasi: Exactly. I want to also ask you something about mistakes that you made in the past in your entrepreneur journey that you might want to share with the audience if you don’t mind.

Philippe: So many, multiple, every day I make mistakes.

Yeah, I think it’s a bit of a difficult question because I think some of the mistakes that you make are actually good in the long run because of the learnings that they bring. So I could say that you know, the first company, for example, was a mistake. It was, but also, for example, I learned how to make videos.

I got some equipment on using it in some of the stuff that we do, you know, so it brought me a skill that I didn’t have. And at the same time, I was better prepared for my second relationship or my second company. Maybe if I look back, I mean, there are also small mistakes.

And so I’m trying to think about the bigger mistakes and the bigger lessons here probably. For entrepreneurs as well, if they’re thinking about it. I went into sharing the company, getting partners away too candidly, you know, so I think if you’re bringing the idea if you’re bringing the business, you need to make sure that you’re not giving too much control, too many shares to the people that are going to help you bring that to life.

So, yeah, I think that my biggest mistake was to think that, you know, I would be able to generate enough business in it. That would not matter, you know, in a way. And the reality is that even if that becomes true, which is not the case yet, but even if that becomes true, you still need to have a balance in the partners that are in the company, in the shares that are in the company.

So, yeah, if I look at it, how could I have changed that mistake? I think what I’m doing more now of as a consequence, is get more outside advice. So whether you have people in your surrounding that know about it or people that have experienced it, sometimes I also seek experience of Professionals, and you can find consultants and professionals that can advise you. Whatever the costs at the beginning, you’re a bit worried about the cost, you know, it’s like, yeah, I’m not going to ask for experts on the hardware infrastructure of the company because you know, already is creating costs. I think that investment pays off. So I think if I was to look back at those mistakes, spend more time thinking, getting advice, and knowing a bit better what you’re getting yourself into.

Yasi: Right. I think when people started to have their own companies, it’s very exciting. And it’s always positive. Outlook is very optimistic, and that somehow can hinder the thinking or the planning that what, if things go wrong, what if this happens? How are you going to prevent it? Or how are you going to balance, you know, what you wish for, and it was the reality maybe happened later on.

Philippe: Yeah, absolutely.

Yasi: And now you have a company called Creative Strategy.

Philippe: Creative strategy digital, yeah.

Yasi: Is it a combination of the one you’d mentioned before, the software and the consulting, or it’s another one?

Philippe: Yeah. So maybe I can explain a few words how it all fits in together. But there’s the TC inside, the company is the market research software, basically.

And they are separate entities, but we’re now working altogether in one company. So, in fact, we’re one company, but two equal entities. The creative digital strategy was basically built around creativity. So, we do a little bit of video production, and then, of course, we use it a lot in everything that we do and deliver — a small part of the business.

Then there’s the strategy part. So, this is the bulk of what we do. So it’s the consulting, the project management, making sense out of the data that’s being gathered, presenting it in reports. That’s really the bulk of what we do. And we have a digital component, which is two-sided.

So, one of it is we talk about the PC insight app, but we also have another application called Smart sales automation which is sort of a light Salesforce automation solution for emerging markets. We’ve deployed that now. And I think 10, 11 markets, mostly in Africa and the Middle east.

And yeah, basically, the company supports all that. So, the application management, but the reporting, the project management, and that had a lot of analytics behind.

Yasi: Hmm. Okay. And then, with this company, you traveled to different emerging markets? Is it for the job of this company?

Philippe: Yeah. So that was before the pandemic. Yeah.

Yasi: Before the pandemic. What are the most interesting cultural shocks that you have experienced?

Philippe: That’s a good one. Yeah. So, the markets where we would work would be the Congo DRC, for example, or Tanzania, Ethiopia, countries like this, so that the culture shock is quite big because they are very different from where we operate. Well, I think, in a way, I was already exposed to that. Cause I’d been to a few of those markets before. I think maybe the most culturally different experience was when I went to Iran.

So, we had a project with Iran that was just before the sanctions, the US sanction that Donald Trump didn’t want to agree to the deal. And I was actually on that day, I was there, and it was very eye-opening. So, particularly for a country like Iran, you have an image in your mind, which is very much dictated by the information, the news that you see, and how things are portrayed.

You know, the Ayatollah, I saw it as a very sort of religious, a little bit backward, but not backward, but not very modern society and then arrived thereon, and I’m like Holy, this is like a super modern city, you know, and very European in their way of being people. So, arriving there and working with those guys was not a culture shock, but it was quite a discovery, just going to say. Well, so much of your perception is based on so little when you see it, then you understand a bit, you know, so, yeah, that was, I think, one of the nicest recent discoveries.

Yasi: Yeah. Unfortunately, our perceptions are so much being influenced by the media. And then if you have never been to the countries, seen it with your own eyes and the people form certain have an idea about this country or people culture. So yeah, travel more definitely helps you open your mind.

Philippe: Yeah, for sure. Or research a bit more, if some people, particularly you mentioned the media, say something, maybe there’s a completely another side to that reality. So always balance the view, I guess.

Yasi: So, my last question is, what is a future plan for your company?

Philippe: Staying alive. We’ve talked a bit about it, we’re almost going to celebrate six years as a business this year, and the keyword from me is becoming more sustainable you’ve built.

Well, particularly in my case, there was a lot on my own or with partners or with external parties to grow. Now we have a team. So, we are with six, seven people now, of which some of them are in Amsterdam, others are in Africa. We want to be able to grow it sustainably.

So, it means having sufficient clients, sufficient work, and business coming through to sustain the increased cost base, of course, of the company and trying to be less of a critical element in delivering the project. So, try to go from doing a bit of everything to getting the team to be able to deliver more of it on their own so that we can eventually also scale.

So, I mean, scale is a big word, but to at least in the short term to be able to be more self-sufficient and autonomous as a company and develop the team into driving more of that. So that I can focus on growing new ideas or spending time getting a new business, for example, because I think the market research parts, which we call that trade census. We’re pretty good at it now, the processes are kind of quite well-refined now, but I think there’s so much more we can do with the sales automation part. So, I really want to grow that part. And then, for that year, you need to, of course, invest in finding the right clients that will help you grow that proposition. So, I think there’s a lot of things that can be done with technology to improve sales.

And I think that’s really space where I want to go in and spend more time, even maybe experimenting with our own sort of sales team, so that we can really be able to have a direct entry into sales without necessarily always having an intermediary into it.

And then from that experiment, a bit more on how you can basically do more with the technology than you can, or rethink certain ways of selling or rethinking how we approach our relationship with customers, for example.

Yasi: Yeah. It’s quite impressive because a lot of small businesses do not survive after two, three, four, five years. And then, with this second or third business that you have, it’s already the sixth year. Really congratulations!

Philippe: Yeah. Thank you, we’re survivors. I think anybody who has survived COVID knows that they’re out there for the long run.

Yasi: Right? Okay. I don’t have other questions. I think it’s a very great pleasure for me to have you here. Do you have any last message to our audience who might think about starting their own business or might be in the process of running their business?

Any advice you will give to them?

Philippe: Yeah. I think if there’s a part of you that feels a certain urge or a little voice in your head that’s telling you, you know, there’s something else out there, I think the fact is that there probably is, and it doesn’t need to be starting a company.

It can be finding a different job that’s more fulfilling. Yeah. I think that we get a lot of mental barriers and people around us also. I mean, having that mentality of wanting to start something is not evident for a lot of people because you’re taking a risk, you know, it’s like, why take a risk, why take a big paycheck? Why just not follow the safe path? And we’re quite flexible.

I think what I’ve learned is that you can do much more than you think you can, you know, it’s like particularly if you’re in a certain job within the corporate world, you know, you’re sent to think in silos, you know, you’re within that function within that..

Yasi: Within the box, the roles assigned to you.

Philippe: Exactly. And even if there’s another part that you’re like, oh, I like that, no, this is, this is for these guys, you know, you stay in that box. I think there’s something quite fulfilling in freeing yourself from that box. I mean, of course, it comes with more uncertainty, and I think that’s an important component to say. If you’re going to start something, think about what you can live without, you know, so plan for a long period of time where you won’t have revenue, make sure that you’re able to live with that, that you’re able to accept that situation.

So, I had my partner, for example, she could make sure that we could put food on the table, but yeah, that uncertainty is an inherent part of what you’re doing, but you may find out even if you fail.

So, I was telling myself, you know, even if tomorrow of this all goes to shits, I will still have that learning. And that in itself is worth it. You know, that in itself is valuable — just that; the journey, the learnings that you’ll take along the way. So yeah, I’d say if there’s an urge, what do you think about it and ask yourself why not?

Yasi: I really liked that message. Thank you so much, Philippe, for being here today with our audience. Thank you for sharing your personal experiences.

Philippe: Thank you. Very happy to be here. I hope that will help some people along the way.