Shor t Takes
And fortunately, at West Monroe we have built
a very robust talent acquisition team. It’s a
big focus for us everywhere, but obviously,
it’s biggest in New York. And I wouldn’t be
surprised if we did some acquisitions along the
way. We haven’t done any in New York but that’s
not for a lack of looking. If I had to guess, I’d say
our growth would probably be two-thirds organic
and one-third acquisition, or close to that.
Consulting: Do you envision an acquisition being
sooner or later in the process?
Mermelstein: Well, the 2020 plan is set and we think
we can get there organically, but if an opportunity
comes up we’ll do it on top of our organic growth,
of course. We are cash rich and sitting on capital
so if a good acquisition opportunity comes along,
we’ll definitely look at it. It really depends on the
market and what’s out there.
Consulting: West Monroe has always been a firm that
has prided itself on its unique and strong culture.
How would an acquisition or all this growth impact
West Monroe’s culture?
Mermelstein: My guess is any acquisition we’d look
at would be less than 50 people and I think we could
absorb that culturally. Look, the firm would obviously
have to share our cultural values and principles.
Consulting: Let’s talk about the organic growth.
Where does that come from?
Mermelstein: We’re definitely active on campuses
for both undergrad and business school. It’s probably
going to be a little less than the firm average because
given the nature of our work we’ll probably be
looking a little more for experienced hires, which
will come from a combination of industry hires and
other consulting firms, both Big 4 and more boutique
firms. I would guess we’re looking at about three-quarters of our new hires being experienced hires
while about a quarter would be from campus.
Consulting: You’ve mentioned doubling the business
each year. How attainable do you think that growth
is in terms of revenue going forward?
Mermelstein: Last year we grew close to 100 percent
in New York, so we doubled the business in 2019. I
don’t see us doubling the business every year, but the
plan calls for about 50 percent growth each year for
the next five years, and I do think that’s realistic.
Consulting: When you look at the industry sector
landscape, where do you see the most opportunities?
Mermelstein: We are highly diversified so the
growth could really come from all over. But if you
look at the PE market, for instance, if you look at
the dry powder and the amount of capital firms are
sitting on and it’s still an asset class that people are
gravitating to and rightly so. We have tremendous
opportunity there. We are dominating on the
diligence side and have a lot of opportunity on the
portfolio side. We haven’t really touched much of
the strategic M&A. Then look at banking. We have
only touched a small portion of the market. Key
accounts will drive some of this growth but so will
new business and new market share. In New York, I
would say about 30 percent of our revenue is from
key accounts. The firm is much higher than that so
we can certainly grow the business through our key
accounts. We can also add new practices, which I’m
sure we will. Healthcare in New York has been more
focused on the payer side and insurance but that
could be an area. Healthcare is a market that I don’t
see slowing down anytime soon; providers and
payers coming together, value-based legislation,
there’s so much there. Also, Life Sciences is huge
on the East Coast and we just started going after
that more aggressively. I think the highest growth
area will probably be healthcare, followed by the
PE space and then banking, financial services and
utilities. I think all of them will grow significantly
but if I had to rank them, that’s how I would do it.
There are lots of growth levers. Which is why I’m
pretty confident about our forecasts and plans.