You Should Be An Accountant - Allan Koltin

[00:00:00] Speaker A: Foreign. [00:00:06] Speaker B: Welcome to another episode of the Worst Advice I Ever Got. I'm your host, Sean Taylor, along with my producer, jb. And today our guest is Alan Colton. Alan is a legend in the accounting world. He's an advisor to top firm CEOs, a sought after speaker, and someone who spent decades behind the scenes helping leaders grow, merge, and rethink their businesses. Alan's been named one of the most influential people in the profession more times than even I can count. And I'm going to count it. And he's got the war stories to prove it. In this episode, Alan shares the worst advice he ever got and how a moment early in his career shaped everything that came after it. [00:00:48] Speaker C: Hey, Alan, thanks so much for joining us today. [00:00:51] Speaker A: Thanks. Pleasure to be here with both of you. [00:00:54] Speaker C: Alan, let's jump right in. Tell our audience about the worst advice you ever got. [00:00:59] Speaker A: Oh, that's too simple. The worst advice I ever got was to be an accountant. [00:01:04] Speaker C: Okay, well, as an accountant, I'm thoroughly scared. And knowing you, I'm even more scared. Who gave you the advice? [00:01:11] Speaker A: Well, the advice came from my parents, but more precisely, my mom, who I love dearly and is still with us today. And she said, alan, if you want to be a success, be a doctor. But if you're not smart enough to be a doctor, at least be a lawyer. But if you're a total bust, at least be an accountant, because you'll always have a job. And those became the marching orders. So I enrolled at the University of Wisconsin as an accountant and I proceeded to set, which still holds today, the all time record for most failed accounting classes. [00:01:45] Speaker C: Oh, my God. So, so wait a minute. So you, you go in and you start taking accounting classes and failing them one after another. [00:01:52] Speaker A: And the truth is, marketing was my passion. My parents said, here's what we'll do. Be a double major, do your marketing thing, although you'll never get a job with it, but do the accounting for us. And I took intro accounting. I flunked, I took it again, I passed. I took intermediate accounting and I flunked, and I took it again and passed. And you would think with that behind me, it would be clear sailing, but unfortunately, Advanced accounting, I flunked and I then passed. And cost accounting, I then flunked and eventually I passed. By the time I graduated, I had failed five accounting classes, which to this day is school record at the University of Wisconsin, Madison. [00:02:39] Speaker C: I love it. So this podcast, JB now, is not only the worst advice ever got, but the Guinness Book of World Records for most Failures in the major of accounting. Because I would imagine that's. I would imagine it's not only a Wisconsin record, it's probably a world record. [00:02:56] Speaker D: Five classes. You think I'm just gonna not do this anymore? I mean, usually after three, you're like, okay, I'm done. So I think the opportunity to fail that many classes is probably not that common. [00:03:07] Speaker A: Everybody always says, when the accounting gods were speaking, why weren't you listening? They were telling you, there is no future for you here. [00:03:15] Speaker B: But you didn't persevere. [00:03:16] Speaker C: Yeah, you persevered, which is interesting. You fail, you come back. You fail, you come back. And you got that accounting degree, right? [00:03:24] Speaker A: Yes, I did. Yes, I did. But you know, the degree is only the first piece. [00:03:29] Speaker C: Yeah. Because then you got to go get. [00:03:31] Speaker A: A job and take the almighty CPA exam. Yes. [00:03:35] Speaker C: Talk about that journey. [00:03:36] Speaker A: I got lucky. I sent my resume and you know when your grade point Average is a 2.3 on a 4 point scale and you don't have much to brag about, Nobody would give me an offer. My. My best friend, Jordy Schnall, his dad had a large local accounting firm in Milwaukee, and he gave me a job. And you know, accountants are nice people. They never give you bad feedback. So my first six months there, I thought it was actually doing pretty good. So good that I got summoned into account the managing partner's office, Howard Schnall. And he said to me, how do you think you're doing? I think they're going to promote me, you know, from staff to senior. And he goes in the desk drawer and he takes out the partnership agreement. Then he throws it across the desk at me. And I'm thinking, damn, I thought it was doing good, but, like, they're going to make me a partner. And I read the paragraph he tells me to look at. It's paragraph 16, and it is. The header is mandatory retirement at age 65. I said, Howard, I think you gave me the wrong paragraph. He said, oh, no, that's the right paragraph. You asked me the question how long it will take for you, Alan, to go from staff to senior accountant. And based on our firm's age, 65, mandatory retirement, I don't think you're going to make it. He then looks at me, he says, I got good news and bad news. He says, the bad news is you're the worst accountant I've ever seen. What's the good news? He said, I want to hire you back on Monday in a different role. To which I said, okay, what role is that? He Said, I don't know, I need the weekend to figure it out. [00:05:10] Speaker C: Okay, so let's, let's stop there for a minute. So you leave this meeting, you've just been told you're the worst accountant, if I'm paraphrasing this correctly, he's ever met. What does your mind do? Where does your head go? [00:05:24] Speaker A: Well, the tough part was my mom and dad, they were devastated. How did you screw up again, Alan? [00:05:31] Speaker D: This supposed to be the backup plan? [00:05:33] Speaker A: Yeah. And I said, let's wait and see what he has to say on Monday. Little did I know that this firm was one of the most innovative, progressive business run accounting firms in America. And when I came back on Monday, he said, I'm going to make you the assistant to the managing partner and you're going to do two things for me. Number one is I'm going to teach you the business of public accounting. Which at that moment I didn't know what that meant, but it would mean that someday I would become a consultant advisor to the accounting profession. It was almost like going for an additional MBA class that didn't exist. But the other thing he said is, I'm looking at what you turned in. He said he had asked all the partners and associates in the firm to list all their contacts, people they knew that were either going to be potential clients or referral sources to the firm. And he said, your list is bigger than all the partners put together. How did you do this at age 25? I said, well, I don't know. I've been shining shoes at the local country club and every one of them owns a business or has a big position at a bank or law firm. And I became all their friends. He said, great, half your time you're going to learn how to run this accounting firm. The other half you're going to be out there going after business and introducing our partners, who are a bunch of introverts, to potential clients. [00:07:01] Speaker C: But I find it interesting because you are being told by a leader you can't do the things that you've studied to do. What was it about you that prevented you from getting mired in that hole that, that most people would fall down into? [00:07:21] Speaker A: Yeah. What a great question, Sean. I, I think outside of the obvious embarrassment of being a failure and, and the hurt that comes with it, I didn't love it, so I didn't have the passion. So the deep rooted hurt of loss never really took in. Matter of fact, you know, he saw I had an, a marketing degree and he said, we're going to Use that degree, not the accounting degree. So he, he saw my skill, he saw my passion. So the failure of accounting wasn't so bad because it unlocked the other opportunity to go down the path of marketing and ultimately management. [00:08:01] Speaker C: He gave you the key to the door that you couldn't open, which was, I don't love accounting, I'm not good at it, I want an exit. And he handed you the key to open the door. It was almost like you were relieved that he was telling you this because you didn't love it. That's what you're saying, right? [00:08:19] Speaker A: Sean, you nailed it. It's almost as if the accounting gods were looking down on me that day and they said, we're going to keep you in the profession, but you're going to do something that has never been done before. There was no one like me out there. And for sure, especially at that age, going after business, thinking of an accounting firm as a business, learning how to run it, how to manage it for growth, profitability, the whole area of the practice, management of the business, it didn't exist. So yes, I got really lucky, right place, right time, but damn, if I didn't get the bad advice to go that way, none of that would have ever happened. [00:09:00] Speaker C: How did you accomplish learning how to run an accounting firm if you weren't really a great accountant? [00:09:06] Speaker A: You know, back in the 80s, which is when this went on, there was the chairman of Chrysler, his name was Lee Iacocca. I don't know if the name rings a bell or not. And I heard him speak in college once and some professor had asked them a silly question. He said, Lee, you're running around the country speaking at places like this, and we're honored to have you here. But if you're here, who's there? And I'll never forget what he said. He said, leadership is not necessarily being in the factory making the car, it's figuring out how to deliver the car, how to make money, how to grow, selling cars and all those kind of things. So even though I never became a great technician, I was able to know what the business needed to do. And it quickly took that pain out of it of not learning all you need to learn about making the product. You need to know just enough, as they say, to be dangerous. [00:10:07] Speaker C: Do you face any resistance from the partners and leaders of the firm to the role that the managing partner was putting you in, which to some degree probably had heavy influence on their day to day lives? Like was there resistance because you were, in their minds, not a good accountant? [00:10:24] Speaker A: Yeah, Huge resistance. And I'm loving your questions here. What I didn't leave out is eventually I would move from one accounting firm in Milwaukee to another accounting firm in Chicago. They had heard stories about this kid in Milwaukee bringing in business at an accounting firm and said, hey, come to the big city and you can do it here. And I think part of the answer was, even though people resented that I was doing something different and sort of moving up the food chain faster than my peers were, what I didn't realize was each time I was taking a new risk and each one could come with a huge failure. But I already had, had that one failure that I wasn't a good accountant. You know, failure to me in those days, when you're 20 some years old, honestly is going to a bar and seeing an attractive girl and asking her out on a date and. And she looks at you and says, get lost, loser. That's failure. Having a prospect in business say, thanks for calling, but we're happy with our accounting firm. I can take that all day long. So as part of this worst advice, where I got hardened was, I'm okay to talk to 20 people and get 19 rejections, and it's okay because the 20th one is going to say yes. At an early age, I learned to cope with failure and see the daylight of success. [00:11:54] Speaker D: That was what happened in your college, right? I mean, you failed the class, you came back, you failed the class, came back, CPA came back. [00:11:59] Speaker A: Yes. You know, one might question the logic and say, how many times you got to get knocked down, though, and get back up. [00:12:06] Speaker D: If you had ignored the advice, where do you think you are? [00:12:10] Speaker A: I thank my parents every single day that they, no matter all the failures I had, and they knew every single one, they kept picking me up off the ground and said, stay with it, stay with it. Something good will come out of this. You know, I was asking my mom last week when I was with her and my dad, how did you know something good was going to come out of it? And there was something she used to say to me. It was these nine magical words. And it went something like this, alan, you can do it. I know you can. It's either eight words or ten. I can't count. You can see how good an accountant I am. But it was that resonation of somebody believing in you, even at a time where you don't believe in yourself. And you know when you're a kid and you have a parent, a parent tells you, you can do it, I know you can, you begin to think Maybe they know something I don't know and maybe I can. It was just enough confidence and push to excel in the next thing you know, we all as parents should never underestimate the power of the word. Where sometimes we shake our heads and think, kids think we don't know crap and they don't listen. And whatever we say, they say the opposite. Trust me, they listen. [00:13:25] Speaker C: Alan, talk about how your story takes you from becoming a partner in your firm to becoming an advisor to partners all across the country today. [00:13:36] Speaker A: Well, the journey was we set up a separate company called pdi and I became, I guess, a famous person in the accounting industry for facilitating partner and board retreats and working with firms and strategy and governance and profitability and growth and human capital, and became known as a trusted advisor. I did that, really, up until about 2012. And then little did I know the next chapter was about to be written. Accounting firms, which for 115 years never did mergers and acquisitions, started to realize there's more than one way to grow a business besides organic growth. Dumb luck again. But instead of it being 1982, it's now 2012, 30 years later. And little did I know that the next 14 years of my career, or 12 years of my career, was going to become as the famous person in accounting firm M and A. And then again, the chapter was going to change again in 2021, when private equity decided to come in the accounting profession. And once again, I'm just standing right in the middle of the accounting firms and private equity. So I look back on this and I keep coming back, which is why I was so intrigued when I heard and listened to many of your podcasts. The worst advice. I started channeling all that and thinking about it and said, oh my God, the worst advice I ever got might have been the best advice. [00:15:14] Speaker B: Alan, what. [00:15:15] Speaker C: What do you think you can glean from your story of failing and turning that failure into one of the greatest success stories in the accounting industry? [00:15:28] Speaker A: Yeah, what a great question. It's to have a no matter what attitude, no matter what barrier, no matter what obstacle gets in your way, keep pushing, keep trying, believe in yourself. And I guess as the story goes, fail, fail, fail. But eventually you'll succeed. And I just feel that many people fail a couple of times and they hit the exit switch, they leave. But had they only stayed in the game a little bit more, giving it a lot more, you know, I've become obsessed with asking people about their careers and failures along the way. And invariably in the most successful people, the reality is they got the crap kicked out of themselves multiple times and had this innate belief or passion that no matter what, they were going to get there. [00:16:24] Speaker C: There are many times when young people start working at a place, whether it's Smith and Howard or anywhere else, and they're not having success and we're afraid to tell them. How important was it to you that you got this honest feedback? [00:16:39] Speaker A: Yeah, it was the greatest gift I ever received. And when I talk to leaders of all kinds of businesses today, you know, I use the saying, you can do surgery with a jagged edge sword or you can do it with a razor sharp blade. Use the razor sharp blade. The most honorable thing you can do for an individual is look them in the eyes and tell them you don't have the skills, you don't have the abilities to excel at this position and you should go look for something else. We, as accountants, many of us are softies. We hold on to people and we also sometimes hold on to clients that we have no business holding onto. I will tell you it, even to this day, for me, the hardest one is sometimes talking to the CEO. The CEO hires me to come in to do a project to talk about the firm of the future. And I've got to talk to that CEO and say, you're not in the future. That's oftentimes the person that engaged me. I remember Alvin Katz. Katz abosh, a firm in Baltimore. And Alvin would tell the story. I'm the one that hired disposal to come into our firm to make us better. And you know the first thing he'd do, he fired me. Alvin, he just had his 85th birthday. He loves to tell the story. But that firm, which was, I don't know, 6, 7 million at the time, today is 30 some million dollars and uber successful. [00:18:07] Speaker C: Yeah, well, I think the experiences of having failed and having someone called you out on what you really needed to address can be applied for decades to come. And that allows you to impact people's lives. And that makes me so happy that you joined us today as a guest because you've been a positive impact on me. You've been a positive impact on Smith and Howard and our family of companies, and you're a positive impact on the entire profession. So I feel grateful that you came today to share the worst advice you ever got. I find it funny and amazing that the worst advice you ever got was to become an accountant because of how successful you've been in giving back to the accounting industry. So thank you, my friend, for joining us today. [00:18:52] Speaker A: Guys, I want to, I Want to thank both of you. You know, I've been at this for 44 years. I've never stopped the clock and really thought about everything that has gone on. This has been like a therapy session for me. So I want you to send me your invoice for professional time, because it never hit me how many times I failed and failed again and failed again, all from that initial bad advice. And how ironic, as I think through four decades in an industry, that the worst advice ended up being the best advice. So thank you guys for. For helping me to uncover all those kinds of things. [00:19:35] Speaker C: Thanks, Alan. [00:19:36] Speaker B: Okay, J.B. you hear the title? The worst Advice I ever got was to Become an accountant. And you think, okay, this is a jab at the profession, but, man, this episode was loaded. [00:19:47] Speaker D: Be a doctor, and if you can't do that, be a lawyer. [00:19:50] Speaker A: You can't. [00:19:50] Speaker D: If you don't know how to do anything at all, be an accountant. You know, that's the fallback. And then obviously, he sets the record for failing the most accounting classes in Wisconsin history. You know, you can't make this stuff up. [00:20:03] Speaker B: Yeah. No, you can't. And what's funny is I've known Alan for. For decades, and this story is so funny. It's so amazing, given what he's done in the profession. What sounds like a story about bad career advice becomes a story about timing and identity, maybe the most important of all, opportunity. It makes you realize that sometimes the worst advice sticks because of who said it. And when you heard it, it gets locked in, and it's hard to unlock that for sure. [00:20:34] Speaker D: You know, I love how honest he was, too, about failure. You know, he failed the accounting classes, he failed the CPA exam multiple times. You know, but each time, you know, he kept showing up. You know, like, you know, you said probably because his mom was like, hey, you got. Look, go be an accountant. You know, and it's not because he loved it, but he just hadn't really figured out where he belonged yet. [00:20:52] Speaker B: Yeah. And, you know, we talk many times about failure and. And its impact, but what really stands out here is how this, for him, it wasn't just one moment. It was a cycle of failure that he kept coming back from and kept coming back from, and it really shaped his ability to lead later on in life. I think he said something like, the most honorable thing you can do for someone is tell him the truth. You know, coming out of that failure and hearing that honesty and that truth really was a game changer for him. [00:21:20] Speaker D: Yeah. And like you said, you know, that's what he does in his job now is sometimes he's got to go up to a CEO and say, oh, yeah, so listen, I know you hired me to find out what the problem is, but it's actually you. You're the problem. So, yeah, you know, maybe the advice was bad, but it led to the right room and the right boss and the right path, and eventually, you know, he's making the right impact. [00:21:39] Speaker B: In the case of Alan, it was, you know, a game changer. And this episode potentially can be a game changer for a lot of folks, just like a lot of our episodes can be. So if you're listening to these episodes and you're feeling very positively impacted by them, do us a favor. Share with others, tell them what you're hearing, tell them what you're enjoying, and hopefully you'll tune in next week because we've got another great episode coming up. Of the worst advice I ever got.