CEO Stories with Nick Araco and Tom Stewart, Achieve Next

Patricia O’Connell

Nick Araco, CEO of Achieve Next, and Tom Stewart, Chief Knowledge Officer, shared insights from a recent study about sentiment among middle-market CHROs and CFOs about where business is headed.

The company, whose offerings include peer-to-peer networks, benchmarking, and human capital solutions, surveyed more than 200 companies, and found a strong feeling of optimism about where business is headed. Three out of four companies expected strong business performance for the remainder of the year, and more than half of that group expected revenues to climb at least 10 percent.


Businesses are worried about both hanging onto the talent they have and finding new talent to sustain growth. Hanging onto and upskilling current employees is as big a concern as finding new employees. And in both cases, it comes down to more than money: benefits (including work-from-home flexibility), culture, and mission all play a role. For women, the flexibility of working from home was seen as the No. 1 priority.


There seems to be no shortage of capital or appetite for making deals; the lack is in the availability of deals to be made. One group put the amount of capital available for deals among smaller- and mid-sized enterprises at one trillion, six hundred billion dollars. Among the CFOs surveyed, one in five ranked finding an acquisition target by yearend as a top priority. Covid, too, remains top-of-mind for businesses, who realize it could still cast a cloud over their sunny predictions.


POC: Hi, I’m Patricia O’Connell, I’m your host for CEO Stories for This is Capitalism. Today, on two-for Tuesday, I am lucky enough to be speaking with Nick Araco, the CEO of Achieve Next, and Tom Stewart, the Chief Knowledge Officer, who are going to take us through a little bit about what Achieve Next does and, more importantly, take us through the data they got very recently about sentiment among middle market CHROs and CFOs about where they see business heading for the rest of the year. So, Nick and Tom, thank you for joining me this morning.

NA: Thank you, Patricia.

TS: Thanks, Patricia.

POC: So, just give us a little background, Nick, as to what Achieve Next is so we know why we should all be so excited about this data.

NA: All right. Well, thank you, Patricia. You know, if you’re a finance or HR leader in an emerging or mid-market enterprise, you have a lot of pressure on you to make decisions with confidence, to execute on them and to perform at the highest level.

So we thought let’s create the most efficient and effective way for finance and HR leaders to gather, assemble online, offline, to benchmark and best-practice share and then, once they figure out what they need to do, let’s train them to do things better, faster, smarter. Right? That’s the competitive advantage in this day and age. So, Achieve Next has combined that power of peer networks with a suite of talent development and performance solutions. So there are no excuses, no excuses not to achieve the next level.

TS: Right. And one of the things that is interesting about the middle market, as Nick knows and Patricia you know, and I, as well, is that most of these companies are private. As Nick sometimes says, it’s kind of a lonely space. There’s not a whole lot of data or benchmarking data on which you can rely.

So, at Achieve Next, we combine three things. One, peer networks, so people can benchmark face-to-face, mano-a-mano, one-to-one what works for you, what works for me. Two, research with these people in the CFO and CHRO alliances so that we can develop data from them and three, then access to a suite of human capital and performance solutions that will help them improve their performance or their team’s performance or the performance of the company.

POC: Okay. So, talk to me a little bit about the data.

NA: Yeah. So, Patricia, I mean, how great is it to capture data from private companies and from finance and HR leaders – what are you committing to, how are you doing, what are you projecting for the next six months? And here our team is out capturing that data. And when Tom and I are allowed to come in, we’ve captured it from 200 enterprises and we get the data in hand, our jaws dropped a bit, right, Tom? We were kind of like, “wow, optimism abounds for recovery.” Those are big numbers, right, Tom? I mean, three out of four, six out of ten – whatever you want to call it – top-line, bottom-line performance is up in these mid-market enterprises.

TS: A year ago, in the summer of 2020, we were in the worst part of the pandemic. I mean it had eased a little bit in the northeast, it was starting to sweep into the south,

business was way down, business was low. We went out and surveyed people six months later, in December, beginning of 2021, and basically seven out of ten said we think 2021 is going to be a better year than 2020. They thought revenue would grow. How could it not, right?

We come back six months later, as Nick said, three out of four, just under three out of four say yes, we still say that. And not only that, and here is the thing that really struck me, within that group, half or more, a little more than half said that they expected revenues to go up more than 10 percent. So, three out of four are saying, yeah, it’s going to better. But of that, like, a very substantial number saying it’s not going to be better, it’s going to a lot better.

POC: What kind of a figure do you usually see in terms of people saying yeah, this is how much revenues are going to improve?

NA: [Laughs] So, Patricia, this is where Tom and I are a bit spoiled, right? We have spent decades working with mid-market enterprises. And let’s just isolate the last few periods. These are finance executives, these are HR leaders, they are going to be conservative. And so many of them played the game of flat was the new up, flat was okay.

Nominal growth minus some hockey stick activities, an acquisition we didn’t plan, an industry disruption that wasn’t on the docket. But most were very conservative with this idea of nominal growth, single digit growth. This more than ten percent number, that is very different than what we’ve seen, right, Tom?

TS: Yeah, it is different. Now the other thing that’s in there is also you see a very small number of people who are forecasting negative growth. A lot of them are saying hmm, it’s still going to be tough. And you can sort of figure those are going to be in the hospitality business or some of the other businesses that are still really constrained by the impacts of the pandemic.

So this is, not only does it skew high in terms of overall growth in those.. but it also does not.. the bottom, the bottom group is relatively small. So, compared to what we have seen in the past and also data that I saw in my previous life at the National Center for the Middle Market, that whole bell curve has shifted to the right for this. People are saying that business has come back strong and that also, they also express an extraordinary amount of confidence not only in the economy but in their own enterprise’s prospects.

NA: Yeah. And Patricia, can I go a little bit deeper on that last point by Tom?

POC: Sure.

NA: Here is where we saw something last summer en masse and then even in Q4 2020 when we released the annual report in January, there was this great concern that even if they were up and running and business was coming back, that their customers couldn’t or wouldn’t pay their bills. The great risk was we’re booking, we’re executing product, we are delivering product or service, but we have great concerns about the health and well-being of the customer and/or other components in the supply chain. That was a top concern a year ago, it was a top concern six months ago.

Now they’re worried most about where to find the talent to sustain and drive their growth. Big shift.

POC: So, when it comes to talent…

NA: Yeah…

POC: Are they worried about hanging onto talent or are they worried about finding new talent because they’re going to need new talent to sustain growth and keep it going?

NA and TS: Yes. [Laughter.]

NA: They are worried about both.

POC: Okay, that was a double yes to an either/or question so that’s a lot of emphasis on the yes there.

TS: There are a couple of things there. Number one, just as we have seen the expectation of revenue growth we also see an expectation of employment growth. So, people do say that they are going to need more people. And so, everybody knows that talent is a problem out there, it’s hard to find people, it’s…our data show that 57 percent of these people say that it’s one of their top.. attracting and retaining talent is one of their top three challenges. And that’s…it’s the number one challenge.

But it is both finding people and also keeping people because if I’m looking for somebody, I’m looking for them on your payroll. And so retention is as important a part of the talent equation as riding it.

POC: Is this part of why you link CFOs and CHROs when you do these reports?

NA: It is, Patricia. There’s a little bit of the Achieve Next secret. We think that combined…

POC: Oh yes, tell us secrets. We love secrets.

NA: Here is our secret, right? Tom and I and the people at Achieve Next think that the relationship between the finance leader, HR leader and the CEO are the trifecta. We think that the three of them together and the functions behind finance and people will drive the success of business exponentially. We think combined, the office of the CFO and the office of CHRO, really if you melded together, they’d make for a chief performance officer.

The performance of the people lend itself to the performance of the company. Right? And so it’s a.. these two used to sit at times separate or in silos. No way, no way. The companies that are growing and thriving have brought the numbers and the acumen of finance together with the people side. Am I right, Tom?

TS: But when you think about the CFO and the CHRO at the most basic level, the minimum that they’ve got to do, they’ve got to keep the books and they’ve got to do pay and benefits, right?  And that’s the sort of guys who are just transactional, those people are just transactional.

But if you move them up then the CFO is responsible for financial capital and the allocation of those resources and the CHRO is responsible for the development of human capital. And so you move up from bookkeeping and pay and benefits and you move up to capital and human capital and that’s where you think, when those things come together… That’s what makes the enterprise, right? It’s that combination of those financial resources and the human resources at that level. When that secret sauce is blended right, that’s what really gives an enterprise its zing.

POC: What are companies doing then to find the talent they need? Are they doing more in the way of benefits? What are they competing on?

NA: Yeah, so here’s one thing that’s interesting from this data. When we dug into what’s going to drive the top line and bottom line, most of the participating enterprises said “We’re not shifting our strategy; this isn’t a `we’re seeing growth because we’ve completely redesigned what we do or how we do it.’ We are focused on doing what we do well and it seems to be working and there seems to be need and demand for it.”

So, it’s not like these enterprises are saying “go get me talent that’s completely different than the talent that I have.” This is a war for the talent that we maybe already have or we have needed for some time or we need more of. So you don’t have this weird dichotomy of “oh, we used to produce widgets; now we deliver hamburgers.” There’s no shift in strategy. This is real horsepower, manpower need at its core and a battle for supply and demand of talent with numbers that don’t make sense.

POC: Talk to me about the numbers that don’t make sense.

NA: So, most of the enterprises we work with will say that the supply that we are seeking is either not out there or hard to find or not moving; there is not enough of what we need. So, we either have to create or develop new pools of talent or we’re going to have to pay more and steal them from somebody else. Or, we’re doing to have to win them with something that doesn’t involve money like social impact, like culture, like engagement, like flexibility.  Am I right, Tom?

TS: Yeah, yeah.

NA: You’ve got the dollars and cents and then you’ve got the intangible here.

TS: Yeah, yeah there are a couple of things. If you look at the data when we at Achieve Next went out and surveyed these people, we asked about actions that people are taking for the remainder of 2021. Against all their priorities, right? Including the talent priority. One of the ones, the one that came out strongest in terms of highest importance was increasing efficiency. Now, these are CFOs, they are naturally going to think that way. But right underneath that was addressing the various talent issues.

So, if you think about these things, one way I can deal with talent issues is I can do what I can to increase my efficiency. I can try to get more out of less. But then I have to address my talent issues. How are they addressing it? Some of it is with retention, some of it is with bonuses and money and benefits, flex… We did a roundtable of women CFOs, all of whom said that workplace flexibility was something that they had experienced in the last year and did not want to give up. It was a.. you want to keep me? Keep it flexible. So, flexibility is important to them.

Another thing that we have discovered and shows up in the data and it also shows up in just our numbers is that they are expanding talent pools with diversity, equity and inclusion. So, in our human capital solutions I think, Nick, it’s fair to say that diversity, equity and inclusion is red hot.

NA: It is.

POC: What role is technology playing in their anticipations about growth?

NA: So, let me comment first, Tom, if it’s okay. And I draw off a bit of the upskilling that…the investment being made in people. So, if a component of a person’s role and responsibility across function can be automated and or supported by technology, mid-market enterprises are doubling down on investing in that technology.

They are not eliminating people, what they are saying is “if we were to free up that person’s time and ability to do something of higher value, higher need, are they up for it and do we have the ability to up-skill them and how do we do that?” So I see technology being a driver for automation which lends itself to greater efficiency and effectiveness of that human component that Tom was talking about.

POC: And ideally though, if companies do the up skilling, that does help to lessen some of the talent squeeze, yes?

NA: Correct.

TS: Absolutely. And to your larger point about technology, Patricia, your larger question, first of all, “technology is my friend” is I think the lesson that middle market CFOs and CHROs have been telling us. I think it’s like 78 percent say that technology is providing a positive benefit.

Now, what are they doing with it is kind of interesting. In this study and in the annual study that we did and also some other work that we’ve been doing just hearing from people, there has not been a lot of “let’s go out and buy a whole lot of new, fancy toys and equipment.”

The focus has been on getting more out of what we’ve got. And getting the elements of the different stacks that we already have to communicate better with one another. One of the things that people discovered during the pandemic is that they had all kinds of features and functionality in their technology that they just weren’t using. And as people went remote, they discovered that and they said “oh, fine, we can do a lot more with this stuff than we had.” Or they were also discovering that staff didn’t talk – my ops staff didn’t talk to my payment staff.

And so, they were recognizing that the communications between operations and finance had been done by somebody carrying stuff down the hall. And say, “well, we can do that with technology. “So we’re seeing a lot… What they are doing is a lot of integration, more than…and optimization, more than a lot of buying new stuff.

POC: What about availability of capital, how did they feel about that?

NA: [Laughs.] Tom, it must be, like, daily that we have a networks member from an emerging or mid-market enterprise announce to us and to the community that capital was raised or a deal was done. There is a frothiness to the capital markets itself. In fact, Tom, you just came from meeting with a group of those capital markets enablers and catalysts.

TS: Yes.

NA: What did you find?

TS: So, yeah, thank you, Nick. I was down at the summer meeting of the Alliance of Mergers and Acquisitions Advisors. This is a group of people who work mostly with smaller and mid-sized enterprises in M&A. It’s not the whales buying whales. And one of the things we know is that there is an awful lot of dry powder out there.

I think the number is one trillion, six hundred billion dollars. So, capital is not particularly hard to find. And interesting fact in our sentiment study data, 21 percent of the CFOs we talked to said that finding an acquisition target was one of their top priorities till the end of the year. So, they are out there looking. And so we see the strategic buyers, those CFOs, saying “I want to find a target,” along with the financial buyers, the private equity guys, saying “we’ve got a fund we’ve got to invest it.” So there is a heck of a lot of capital out there looking for deals and a relatively un-changed universe of deals.

NA: The timeline is compressed if private equity is in. And it is immediately now that we’ve bought you, let’s buy three more.

TS: It’s a seller’s market.

POC: So how much of this is pent-up demand, how much of this is just we live in a more accelerated world than the last time we saw a lot of frothiness and a lot of activity, how much of it is just a little bit of euphoric hysteria, if there is such a thing?

NA: I think all of the above but I will tell you that I think that the PE timeline, the private equity timelines are compressed as well. What was once a five-to-seven-year kind of threshold on “we bought the platform, we grew it, we have to have an IRR and an exit” is now there is a compression and a demand, maybe we do it in two and a half years because the market is so hot and we can.” Right?

So, I think everything is being compressed. I do think there is an attitude of bullishness and excitement, an unleashing attitude. But I do think part of it also is the phenomena that we can, we can do this sooner, we can do this better, we can do it faster.

TS:  So, I think there’s both cyclical and structural issues here in this increase in M&A. Cyclical, a lot of pent-up demand, as you said, Patricia. I mean, in the first half of 2020, deal making stopped with the pandemic. You could do a valuation. What was the company worth? You didn’t know how to do it. It picked up again in the second half of 2020 mostly for the best quality deals.

NA: Yes.

TS: But there was water behind the dam and its released. But there also are these structural things. First of all, there is all this dry powder and that means that multiples are going up and that’ll bring sellers to the table who might not have been there before. You raise the price high enough… you know?

But the other thing is that you might..- that also there are issues of tax that are coming up, that’s more in the cyclical stuff, people are seeing potential tax increases so let’s do the deal now. And there is also this question of whether there will be the long-foretold tsunami of baby boomer sellers as boomers retire and say “you know, my kid is not taking over the business, why don’t I just sell it to this nice guy down the block with this rapacious private equity firm from Wall Street.”

POC: Because most of these companies that are private probably want to stay private?

TS: Yeah.

NA: Yeah, yeah. I would tell you I haven’t met a robust performing private company that says… if they are entering the public markets or private equity that was their intent and purpose all along. But if you’re doing good as is, the last thing you need is to throw the additional pressure that comes with that shift from closely held, privately held, to something else.

TS: You know, the big reason to go public is not to raise money. Because you can raise a lot of private money. The big reason to go public is to make some of the value of your company liquid.

POC: You’ve given a lot of bullish sentiment; you’ve talked about a lot of great indicators. Is there anything the report, anything in the data that wasn’t quite as optimistic or anything that makes you…give you a little pause to say “huh, maybe we’ll be looking at something different next time around?”

NA: Tom, let me throw something out there and I’ll be curious because we have talked about this and we’ve published on this in other arenas too. But there is a concern about the performance and the stretching of these enterprises’ current sales talent to be able to make good on these top-line revenue projections. More than half expressed a concern that their current sales force may not have the skills, ability and tenacity to perform the necessary requirements to drive that top line revenue performance. Some call it fatigue, some call it skills gap, and some call it a reluctance to work better, faster, smarter. Right?

TS: Yeah, you could think about capabilities, costs and Covid as three concerns. And capabilities include will I have enough people. People are worried about the threat of inflation – is this just a getting-back-to-business thing that the python has to digest or is this going to be a cost issue?

And then the Covid concerns are not there. I mean, three out of ten still said that Covid was… the ongoing impact of Covid was a top concern. And we collected these data in June. The questions about those who are not just vaccinated and the sort of what we’re seeing right now in July and August with this rise in Covid only underscore that.

So those three dark clouds. But lay them against really, really strong confidence. And what’s interesting in the confidence numbers is that the closer you get to the company itself, the global economy, the U.S. economy, your local economy, your industry economy, my company, the closer you get to things that people see themselves the higher their confidence gets.

POC: That’s interesting.

TS: And that’s really interesting. The closer view… They are the most confident in their company, next in their industry, next in their city, very confident in the U.S., a huge turnaround in U.S. economic confidence. Global is kind out there in the world, it’s a little more mysterious but there is still pretty strong confidence. But the closer to home the more confident people feel.

POC: Where can people find out more information about Achieve Next and get a look at this data themselves?

NA: They can go to, a platform that has access to benchmarking resources reports and our networks and our people. We are active on social media, Twitter, LinkedIn and the like. But probably the most efficient and effective way, go to Achieve Next and start having fun accessing what you can there.

POC: And when can we look forward to the next report?

NA: Ahh so I was going to give you a taste of that, Patricia.

POC: Oh, lucky me.

NA: So, we talked about the war for talent. The current study we are in the midst of collecting data on and will analyze and will release a report in mid-September is a mid-market talent acquisition compensation and culture benchmarking study that will look at trends in all of those three areas in particular. Tom and I have had countless meetings with finance and HR leaders who said we have analyzed where we are losing talent and we are not losing them to the company down the street, the company down the block, the company down the road. We are losing them to companies anywhere and everywhere given this ability to work from anywhere and everywhere.

POC: Well, and that’s why I actually think culture is going to be the most interesting piece.

NA: Yeah. [Laughs.]

POC: So I think we will have a great conversation in a few months.

NA: Awesome.

POC: So, Nick and Tom, I want to thank you so much for joining us today on CEO Stories for This is Capitalism. I’m Patricia O’Connell. Thanks for listening to us.

About the Series: Featured stories from the intersection of the free market and entrepreneurial success. Here we speak with leading CEOs, academics, philanthropists and up and comers on their contributions and perspectives on the American economy.

About Patricia O’Connell: Patricia O’Connell serves as Editor in Chief of “This Is Capitalism,” a content site sponsored by Stephens Inc., and is host of the site’s podcast series, “CEO Stories.” Patricia, a former editor at BusinessWeek and a New York Times best-selling author, brings her experience as a journalist and her passion for storytelling to “This Is Capitalism.”