NC Niall Cotter On Build a Better Agency Podcast

“I think that they're confidently wrong, frankly. The folks that build those models are very good arithmetically, but built into those models are assumptions. If those assumptions are not tested, particularly when you're growing, then you will get beautiful answers. There's nothing more comforting than looking at a growth forecast that shows that your profitability is growing. It's much easier than looking at pricing.”

Build a Better Agency Podcast · Agency Business · November 2026

Context

The host asked a fractional CFO why growing service firms struggle with their finances if reporting isn't the problem. His answer: polished financial models rest on untested assumptions.

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Transcript

Build a Better Agency Podcast Around 03:13 into the episode

Niall Cotter

…to their own numbers and I fix that. Before this, I spent 17 years at SCB Canada in controllership and financial planning and analysis positions, then nearly nine years as a full-time CFO, most of it in professional services. So I've sat at the seat where numbers have to answer owners' questions.

Drew McLellan

Beautiful. So I know one of the things that you believe is that most service firms, particularly growing service firms, it's not that they don't have enough reports or dashboards. It's not a reporting problem. So what do you think the problem is?

Niall Cotter

I think that they're confidently wrong, frankly. So the folks that build those models, you know, and these are my finance folks, they're very good arithmetically, but built into those models are assumptions. And if those assumptions are not tested, particularly when you're growing, then unfortunately, you will get beautiful answers. And there's nothing more comforting than looking at a growth forecast that shows that your profitability is growing. It's much easier than looking at pricing.

Drew McLellan

Right. Right. So give me an example of when you have been brought in and a report was beautiful, but as you said, confidently wrong.

Niall Cotter

Well, I can actually reach back to my SCP days. And just to be clear, although SCP is a big company, it was made up of multiple business units with VPs in charge of between 25 and 100 employees. So one example was where we were bringing on average about 200 foreign consultants, mostly from India…

Drew McLellan

them. So as you know, everybody listening to this show works at an agency or owns an agency. So take me back into an agency when you saw this problem. What was the owner asking? And what were the numbers saying back that would have led them either to not making a decision or making a wrong decision?

Speaker names come from our own diarization. The position is estimated from where the line sits in the episode.

More from Build a Better Agency Podcast

“Having been on the purchasing side myself, it's quite easy to poke holes in the story of a business. Your numbers need to meet the story that you're telling. If it's a growth story, you need to have shown that historical growth. If 40, 50% of your clients are from five to 10 companies, that's a weakness. And is it the owner's relationships that are holding this business together? Am I buying the business or am I buying the owner?” — Niall Cotter, Build a Better Agency Podcast

“I think it's about 10 or 15 people. That's when an agency owner no longer knows everything that's going on inside the agency. When you're five people you're like a unit that just moves together, but you get to double digits and all of a sudden you have people working on work that other people don't see. The owner can no longer keep their finger on the pulse, and you need checks and balances that you did not need at four or five people.” — Drew McLellan, Build a Better Agency Podcast