Kate Eberle Walker was brought on as CEO of PresenceLearning to turn the ship around. The company was experiencing flat growth and high employee attrition.
Within two short years, Kate has guided the company to 70% growth year-over-year and break-even on EBITDA. The secret to her success? It turns out, passion for her work has no small role to play.
Kate began her career in investment banking but quickly found her way into the world of education. Through roles at Kaplan and Tutor.com, Kate came to know and love the space. Soon enough, she was taking on bigger and bigger roles at The Princeton Review, finally serving as CEO for several years.
When she left The Princeton Review after a successful exit, she paused to regroup and think about what she really wanted from the next step in her career. She knew she loved the education space and was especially interested in using technology to build a better connection between students and experts, like the work she’d been focused on at Tutor.com.
An investor she’d met happened to have the perfect company in his portfolio: PresenceLearning. It ticked all of the boxes Kate was looking for, and it was a company in desperate need of strong, decisive leadership.
When Kate came on board, she had some fires to put out immediately. About half of the workforce had left. And when she announced to the San Francisco-based team that she planned to recruit for new roles in her city of New York, even more people departed.
But she did not let that deter her. Kate began meeting individually with each remaining colleague to build interpersonal connections and better understand the inner workings of PresenceLearning.
The business still faced hurdles. As a telehealth provider, one-to-one meetings are central to PresenceLearning’s offerings. To scale, Kate needed to hire hundreds of clinicians (and, eventually, thousands more).
Additionally, the pandemic hit in the midst of Kate’s second year with the business. With it came an increased demand for virtual telehealth services. The technical team at PresenceLearning has worked to build out a more robust system to manage capacity, with algorithms that can predict needs so clinicians are utilized effectively.
The pandemic has also inspired PresenceLearning to branch out into the world of SaaS. They are now licensing their secure teletherapy platform for use in private practice and school districts that have an existing network of clinicians.
Towards the end of the show, Kate discusses her other passion: supporting women in the workplace. Her forthcoming book, The Good Boss: 9 Ways Every Manager Can Support Women at Work, comes out in March 2021 and explores the common thread women leaders share in their career paths.
Surprisingly, that common thread isn’t an MBA or special business certification. Rather, every woman leader said that somewhere along the way, they had a great, supportive boss. Kate has written this book to guide those (mostly male) bosses out there who want to mentor and support women on their career journeys.
Kate’s story proves that business is anything but a dispassionate enterprise. Whether it’s her commitment to the education industry, mentoring other women in business, or driving impressive growth results, Kate doesn’t create distance or remain cool. Instead, like many great leaders, she puts her heart into everything she does.
Rob Ristagno: After a successful exit as CEO of The Princeton Review, Kate Eberle Walker has some time to think about her ideal next career move. By clearly defining what she wanted for herself, she found the absolute perfect role, CEO of PresenceLearning. While the company was struggling while she came onboard, her passion for the role and expertise in the education industry combined to help her lead a remarkable turnaround. We discuss her leadership philosophy that’s garnered these impressive results.
Intro: This is the CEO Campfire Chat with your host Rob Ristagno. Taped in front of a live studio audience, join us to hear successful growth stories from middle-market companies, just like yours. Sponsored by the Sterling Woods Group.
Rob Ristagno: Welcome to the CEO Campfire Chat. This is your host Rob Ristagno. And I have the pleasure of introducing Kate Eberle Walker. She is the CEO of PresenceLearning and has been leading education companies for the past 20 years. She also sits on the board of directors for Rosetta Stone and previously served as the CEO of The Princeton Review. She’s an author whose book The Good Boss: Nine Ways Every Manager Can Support Women at Work is coming out soon, March 9th. Welcome Kate.
Kate Eberle Walker: Thanks, Rob. Thanks for having me.
Rob Ristagno: Yeah. We’re glad you could make it here. You’re a seasoned CEO. Now, tell us your backstory. How did you know that one day you wanted to grow up and become someone who could lead an organization?
Kate Eberle Walker: Well, for a long time, I would say that I didn’t know that. I was out of school as a finance person. I worked in investment banking, I did deals. And one thing that I wrote in my book is that 65% of the women who become Fortune 1000 CEOs didn’t know, or it didn’t occur to them that they would be or could be a CEO until someone, typically their boss, told them that they saw that in them. And that was exactly what happened for me.
Kate Eberle Walker: I had worked for a long time in investment banking, like I said, M&A. And when you’re doing deals, when you’re in hundreds of deals, you study all these business models. You start to form very strong opinions about what you would do if you were running it. But it still kind of took me a little while from there to make my move.
Kate Eberle Walker: I had gone to work for Mandy Ginsberg at IAC after 10 years of doing M&A at Kaplan and started forming a strategy with her. She was running Tutor.com at the time. We put together a plan that included acquiring Princeton Review. And as we’re working on that, at one point she turned to me and she said, “I see you as my successor.” And kind of even to my own surprise, I said, “Well, I see that too. That’s what I want.” And it sort flowed from there. So it really came from getting to work for someone who helped me see my own potential.
Rob Ristagno: It’s great to have a mentor who can point you in the right direction, right?
Kate Eberle Walker: Exactly.
Rob Ristagno: And be supportive?
Kate Eberle Walker: Yeah.
Rob Ristagno: Okay. So two years ago, you’re brought in to turn around PresenceLearning. Let’s start with the outcome and then we can reverse engineer it. So you’ve been there about two years. Tell us, how is it going? What are some of the metrics here that you’ve been looking at?
Kate Eberle Walker: Yeah. Times are pretty good for us at PresenceLearning now. The business, when I came in a couple of years ago, was facing a second consecutive year of single-digit growth. Right now, we’re pacing at 70% growth year-over-year in our top line, which is exciting. And we also reached breakeven on EBITDA earlier this year after we were, at the time that I came in, losing $14 million. So things are good.
Rob Ristagno: Those are impressive figures. And I’m sure we’re all curious here to hear about how you actually accomplished that. So before we dive into what you did, let’s take a quick step back. Tell us a little bit about what PresenceLearning is, what you do, what you and your team work on?
Kate Eberle Walker: PresenceLearning, we are a telehealth company that exclusively serves the education market. So all of our customers are K-12 school districts, mostly public school districts. And we’re providing special education services. So we provide, live online teletherapy, speech therapy, occupational therapy, mental health counseling for students who have special education needs, have learning disabilities.
Kate Eberle Walker: There’s about seven million kids in the US public education system who have required services to support their leaning needs. And public schools are obligated to provide those services. So we work with the schools to help them cover their caseloads, deliver the therapy, and to evaluate students to determine what they need.
Rob Ristagno: All right. It feels to me like a dual mission type of company. Of course, you need to turn a profit for your shareholders. But it sounds like you’re really doing great stuff for society at large.
Kate Eberle Walker: Yeah. Well actually, I talk a lot about—we actually have multiple missions, because of course we want to grow the company and drive profits. But we also see our driving force is to get as many kids as possible the services they need.
Kate Eberle Walker: There are significant gaps across the country. And those gaps are larger in areas where there is low income or racial inequity. There are a lot of kids that, even though it’s federally required for them to get these therapy services to support their needs, they just don’t get them. Schools really do struggle to get the therapist in place and to deliver the service.
Kate Eberle Walker: So we have this driving mission to make sure that every child who needs support gets support. But we also have an equally driving mission of supporting the therapists in giving them a way to work that works for them.
Kate Eberle Walker: So a lot of our therapists are speech language pathologists (SLPs), which is a profession that is 97% female. And a lot of the SLPs, they start out working in a school. Those are really hard jobs, very demanding. And a lot of those women go on to have children and find that they can’t keep doing that work they love with students and maintain their family, manage what they need to do at home.
Kate Eberle Walker: The company was founded 11 years ago. And we created this new way for all these SLPs to keep doing what they love, to keep delivering therapy to students, but to not feel like, to be able to do that, they needed to hold these full-time jobs where they were driving to school and staying in the school all day. So we are as passionate about that, about what we’re doing for all these women that want to really keep on using their degrees and keeping doing the work that they love.
Rob Ristagno: So it sounds like a triple or maybe even quadruple mission organization. What else besides the mission got you excited to take the job as CEO?
Kate Eberle Walker: When I was deciding what … So I had sold Princeton Review, and was thinking hard about, “Okay. What’s my next company going to be?” And I think about the companies I run as sort of an infatuation, maybe even an unhealthy obsession. When you’re running a company, you care more than anybody else cares. And you want more than anything for your company to succeed. You lose sleep over it.
Kate Eberle Walker: So after Princeton Review, I had this chance to take a deep breath and really be thoughtful about what I wanted to run next. And I was having coffee one day during that time with a friend of mine who’s an investor in the education sector, which when you’re a job-seeking CEO, you have a lot of coffee with a lot of investors. So that was not unusual.
Kate Eberle Walker: So it was my friend Jason Palmer at New Markets. And he asked me to describe like, “What’s your ultimate company, if you could invent the next company you’re going to run?” And I said, “I want to run something in education.”
Kate Eberle Walker: Ideally, I wanted to have a similar business model to Tutor.com, which had been part of Princeton Review. And I really loved that business. It was using technology to facilitate a better connection from a student to an expert. So it was still a services company. We were still connecting experts to students, and having that human connection. But we were using technology to make it more accessible, more affordable.
Kate Eberle Walker: And I loved that business model. And I said, “If I could have another business like that, maybe doing something even more meaningful than helping kids get better grades, or better test scores. And if I get to perfectly design it, I would love for it to be earlier stage than Princeton Review so I can really come in and have an impact. But not too early stage. I want it to be mature enough that I have got a team and people to work with.”
Rob Ristagno: A good concern.
Kate Eberle Walker: And so Jason, he was like, “We have this company in our portfolio. And we’re hiring a new CEO. We’re about to launch the search for our first outside CEO. The founder is ready to transition.”
Kate Eberle Walker: And so it was kind of perfect. So that company was PresenceLearning. And it was all of those things. It was exactly what I wanted. And when I got to know the rest of the investors and the team and find out what they did, it was like I got that infatuation feeling that I was kind of looking for. I was like, “Okay. This is my company. This is the company I’m supposed to run.” So it was actually a very easy decision to join.
Rob Ristagno: I love that phrase, infatuation feeling. I think it’s something that we should all keep in mind on a daily basis as we’re looking at our careers.
Kate Eberle Walker: Yeah.
Rob Ristagno: It also sounds like a story—and you were crystal clear about what you wanted—and so if you know what you want and you can communicate it, you shall get it. It sounds like-
Kate Eberle Walker: It does. It’s a little shocking when I look back that I literally found exactly what I wanted. But it certainly goes a long way to get your own clarity on what is your perfect result? What’s your perfect outcome? And turns out you can find it.
Audience Member: What to me is really interesting is your comment that—so, I was a CEO of a company for 11 years. And it was turnaround, and then a growth play. Right?
Kate Eberle Walker: Yeah.
Audience Member: But company became you, and you became the company. When anyone criticized your company, they were criticizing you.
Kate Eberle Walker: Yes.
Audience Member: And you took it personally. It’s a much more personal thing than just, “Oh! I’m running a company.”
Kate Eberle Walker: Yeah. And one of the things that I do is every new hire that we make—and when you’re growing, it gets into the hundreds—I schedule a one-on-one introduction in the first week, where we don’t talk about the company or the work. I just get to know them and share more about myself personally. And each conversation is a little different.
Kate Eberle Walker: But I feel like you are responsible for every employee, for their livelihood, but also I think for their happiness. You want them all to be as fulfilled as you are running the company. So I try to stay true to that even as companies get bigger, to actually know every person who’s there.
Audience Member: Exactly. I mean, I ran a company in London. So the local pub, we had an open tab for all the employees to come out after work and have a couple of pints. And everybody could talk to everybody else. But it was like a family. It was everybody knew … I knew every employee’s name. I knew most of their spouses’ names. And in many cases, I knew what university their kids were going to. And it’s a different kind of world. These are smaller companies. You couldn’t do this at GE. But in a smaller company, you can. And I think that’s the really good stuff.
Rob Ristagno: That family feel in a corporation can be magical.
Audience Member: That’s the good stuff.
Rob Ristagno: Hey Fred! I think you had a question. It looks like you had a question for Kate about PresenceLearning.
Fred: Well, you blew me away with the 70% growth rate. I mean, 20% or 30% is hard enough to manage. And I’m curious about how you might continue to scale at that, when my experience with technology in learning, especially … It sounds like you have a one-on-one relationship with everybody. Is that part of your issue? Is that the school’s issue? How do you manage that technical connection between your students and your therapists?
Kate Eberle Walker: Yeah. There’s a lot that goes into it that I think a big part of what why the board brought me in for the next phase was to figure out: How do you scale something that is a series of one-on-one connections? And there’s a couple of different things that are working for us here.
Kate Eberle Walker: One is that, I mean, you do have to hire, ultimately, thousands of therapists to be ready to serve the work. And Princeton Review, we had about 7,000 teachers and tutors. So I often draw parallels between what managing that workforce was like and what we needed to do here to make sure we have enough people, we have them in the right places, to match the right individuals to the right students.
Kate Eberle Walker: So the answer there is more technology. So I brought over my CTO that had been the founding CTO at Tutor.com, was the CTO of Princeton Review with me. He’s here now at PresenceLearning. And he has built and continues to build algorithms on the back end to manage all of that capacity and predict the needs. So that’s huge.
Kate Eberle Walker: The other thing we’ve done is launch a totally different business line that is smaller but it will get to about 10 million of revenue this year, which is not a services. It’s a SaaS model where we are licensing our teletherapy platform for private practice providers and school district providers to use. And so having that other thing to sell, source of growth, that is a different kind of a model and really a less complex operational model, I think has helped to support growth.
Rob Ristagno: What other questions do we have for Kate? Go for it, Dave.
Dave: Yeah. So sort of two unrelated questions. And you don’t have to go into too much detail on either. I’m really curious around the efficacy of online versus in person, and from the perspective of students, from the school and from your huge workforce of licensed practitioners. So that’s one.
Dave: And then on completely other note, I’m also super-curious about the business model in terms of things like pricing and what happens during the summer, and what sort of on demand versus subscription, and does it get the districts pay less if they use more sessions? How does that all work?
Kate Eberle Walker: So in terms of the efficacy, there’s a lot to come in that area. So when we talk about our own success measures of impact, and we have our impact metrics and well as financial metrics. We are still in the zone of being very focused on, “Are we making sessions happen? Are we delivering therapy that wouldn’t get delivered if we weren’t in the mix?”
Kate Eberle Walker: And I look at the sort of evolution of online adoption and compare it to tutoring. And I think for online therapy, we’re still back—well, we were until COVID—in that phase of you’re proving to people that online was just as good. That it’s okay to do it this is. It’s equivalent.
Kate Eberle Walker: Literally, we’ve done, our research studies have largely been equivalency studies where we’re taking data sets and proving the equivalency. So that’s kind of where the research is at. That’s where the conversation is at. Of course, it is much more exciting to get to the next step of where is it? Is it better? Where is it better?
Kate Eberle Walker: So we’ve kind finally, now that we’ve gotten bigger, now that we’re not feeling as budget constrained—still budget constrained but not as much as we used to—we actually got to the point where we’ve decided to hire our first research leader to start designing the studies, because we think we have more volume, more data than anyone else would have to be able to start getting into those questions, because we hear a lot anecdotally from our clinicians who all worked in both ways.
Kate Eberle Walker: We don’t hire anybody unless they do have some experience in school setting. So we get all of these anecdotal comparisons where they think that the progress is made more quickly because they establish the rapport more easily. And then kids these days are often more comfortable engaging through a screen. They’re very used to it.
Kate Eberle Walker: And particularly for certain needs, we find that the students are less comfortable in the room with an adult they don’t know. And they can open more quickly online. So just the ability to have thousands of video, picture, emojis at your fingertips to pull from, it’s a little quicker to figure out what is this child into? If somebody says, “I like animals.” It takes two seconds to pull the animal flashcards. You couldn’t do that kind of staff if you were in a room. So I don’t have good data to share with you yet. But I think that that is next frontier on the research front is to start proving that it’s better, not just as good.
Kate Eberle Walker: And then the economic model and pricing. So in K-12, I do find you need … There are a few different ways for districts to pay. So the short answer is all of the above. We have some districts that are entirely hourly rate, pay as you go. There are others who prefer to set a budget upfront and pay it upfront. So we do a flat rate. We say, “Okay. You’re going to have 100 students getting biweekly speech therapy, and we’re going to charge you this per student. And that’s it.”
Kate Eberle Walker: And then there are others who do it on a sort of employee-like structure where they say, “I need you to give me 10 dedicated clinicians.” And we’re charging for their time more like a salary. So it’s kind of all the above. And then now, with the introduction of the teletherapy platform, that’s the only one that has that sort of subscription [crosstalk 00:19:52].
Dave: Different revenue.
Kate Eberle Walker: Yeah.
Dave: What happens in the summer?
Kate Eberle Walker: In the summer, everything gets a lot quieter. So it slows a lot like a school. So a lot of our clinicians like to take the summer off, and they do. So that’s easy to give them that time. There’s always some that do want to work. So they’re going to raise their hand to cover summers. There’s summer school. There’s extended school year for these services for a subset of the kids. And so we have some work and some clinicians that want to take that work. But things get really quiet during the summer.
Dave: Thanks for that. Interesting.
Rob Ristagno: And Michelle, you have a question for Kate?
Michelle: I guess I had a question about—I know that whenever you’re selling something to a school, it’s really complicated because there’s school boards, and there is different sources of funding, and there’s all sorts of rules and regulations. And there are lots of hard trade-offs to be made. So I was wondering if you could talk a little bit about how you manage that, or if it doesn’t come into play for you guys.
Kate Eberle Walker: It definitely comes into play for us. And in other businesses that I worked, we’d sold to parents, to consumer, retail, to higher education institutions, to corporations and K-12. And I never would’ve predicted that I’d choose to focus in on a company that entirely sells to K-12 institutions because it is by far the most complex and has kind of a slower selling cycle.
Kate Eberle Walker: I have found one of the things that’s really nice about our business is, in special education a lot of those dynamics are less so because the services are mandated and funding is coming in through the individual’s disabilities and education act, through federal funding, and can also be supplemented with Medicaid. There are these sources outside of your typical school budget, school district budget that are there, and are reliable.
Kate Eberle Walker: So even in times like this where, of course, everyone is talking about cuts, school budget cuts, we’re fairly insulated from that. So it makes for a different kind of behavior than you’d find elsewhere in K-12.
Michelle: Okay. That’s really interesting. Thanks.
Audience Member: Kate, I had a question. So I think the materials Rob sent out kind of said Kate runs an education company. And you even described a minute ago that you were looking for an education company. But when you first introduced yourself, you said you run a healthcare company. So I’m really kind of curious what … Obviously, it’s sort of the intersection of those two. But what’s different about it in terms of the healthcare aspect of it? Are you subject to all kind of HIPAA regulations? Are there other factors that make it more of a healthcare company in fact than an education company?
Kate Eberle Walker: Yeah. This was most of all an ongoing debate when we were fundraising last year. We raised our Series D through last winter and closed it in the spring. And the question of whether we were going appeal to healthcare investors or education investors was this dynamic throughout because the reality is we’re a healthcare company. And we’re providing services entirely through licensed clinicians. We are HIPAA compliant, in addition to needing to be FERPA compliant for K-12 student data privacy. It’s funded by Medicaid, a lot of the services we provide.
Kate Eberle Walker: So I think it’s really interesting because I think we are a health company—healthcare services company—that happens to sell to an education end market. But I would say our investors, Bain’s Double Impact Fund, led our series D. And our other investors, Catalyst New Market, they’re largely education-focused investors.
Kate Eberle Walker: And I think that the education end market is so different and complex in its own ways as we were just talking about. So when people look at us as company, somehow education trumps the healthcare side of it. And I guess you can just throw it out. I guess I do that too, as much I think we’re providing a health service. And boy! We operate, we sell into education and see that as the market we’re in. We don’t talk about customers. We talk about students.
Audience Member: Interesting. Okay, thanks.
Rob Ristagno: Al?
Al: I have a question. With 70% growth rate, I would imagine that a lot of that has been … COVID has been a factor in that, as schools have gone out of brick and mortar buildings into online. So two questions. One is, are you finding your new customers—obviously, some of this growth rate is probably you’re finding external customers, new customers. Are you finding them or are they finding you? And are you supplementing those resources that are at the school? Are you replacing them in this environment?
Kate Eberle Walker: Yeah. I almost jumped in because I got so excited to answer the first part of your question of are you finding them or are they finding you, because they’re finding us. And it is of course the most exciting for a sales team when you see your inbound leads spike upwards. And we continue to see about 10 times the engagement volume as we saw pre-COVID.
Al: How are they finding you?
Kate Eberle Walker: Well, if you google online speech therapy, or if you … A lot of it is word of mouth in this market. So every district has a special education director. And every state has an organization for all of the special education directors. And in pre-COVID times, this is very much a conference-driven selling process and even still it’s those groups, it’s those gatherings of special education leaders who talk to each other.
Kate Eberle Walker: And we are fortunate to be in a good position. PresenceLearning really created this concept. I mean, it was the first of its kind. Back in 2009, the founders saw this opportunity to introduce teletherapy to the K-12 market. And we’ve kind of been doing it the longest. We’re the largest.
Kate Eberle Walker: And so if you ask a special education director, “Who have you heard of? Who do you know? Who do you work with?” Our name comes up in word of mouth as well. So that’s a lot of what we do, in addition to, of course, making a lot of phone calls and doing a lot of our own outreach. But yeah. We have definitely been a business that has benefited from COVID and the need for online student services. And so that we saw pretty quickly in the spring. And it’s continued to grow.
Kate Eberle Walker: And then your other question about are we all or part. We are almost always supplementing the school’s services. So the school will have a special education director, a team of onsite therapists. And they will, more often than not, have some needs come up in some districts, particularly very rural districts, districts that have other challenges, might be very low income, might not be a place that—it might be harder for them to hire, they might have a large need where, there are districts where we serve all of their students.
Kate Eberle Walker: But most of the time, we’re working with a district to help them manage the gaps. So we do. They’ll send us case loads. They’ll ask us to take their evaluations that their staff is getting backed up. We cover leaves—there’s a lot of short term leave, medical leave, maternity leave, that happens in the space. And we’ll come in and cover that.
Kate Eberle Walker: So it’s almost, there is some collaboration with the district team, which is why we were able to, in response to COVID, launch this other business line of licensing our platform and training school-based therapists on how do you do teletherapy. So you’ve been with a student in the classroom, how do you adapt that? How do you engage with that child online? What are the tips, tricks, tools?
Kate Eberle Walker: We were able to launch that because we already had all of these working relationships where we were collaborating with those teams, and we knew they needed. So it was really nice, and it was a very natural extension for us to start doing that, which we did it for free for our existing customers in the spring, started selling to new customers, and then heading into the school year became a paid product.
Kate Eberle Walker: And we didn’t know. You sort of try things and see. We know it will be helpful now. We don’t know if it will turn out to be a longterm viable revenue line. We don’t know how big it’ll be. My CFO and I had a great debate over how much revenue to put in the budget for this school year.
Kate Eberle Walker: He said two million. And I was like, “What?” I was like, “That’s not enough. You’ve got to put four. Double it. Put four.” And now, here we are. We’ve already sold seven, tracking to 10. But we don’t know how big it’s going to be this year. But all that came from that sort of position we’re in, where we’re working with the district and not totally replacing them. You’re sort of there to take on what they need.
Rob Ristagno: Go with your gut. Follow your heart. Trust your intuition. We’ve heard this kind of advice before. And sometimes it works. Like when you’re trying to decide what movie to binge tonight, or you’re on the fence about asking her out for that second date, or you have a sneaking suspicion about which neighborhood dog keeps digging up your lawn.
But it’s not the way to make major business decision. When you’re facing challenges with growing your revenue, it’s not enough to rely on instinct. That’s why we’ve developed a data-driven solution to help you easily unearth your best opportunities for growth. No guesswork required. To learn more about our system, go to sterlingwoods.com.
Rob Ristagno: Sy, go for it.
Sy: So I think this is also kind of a two-part question, although the second one you might have slightly addressed. When you were answering Al’s question, you said that sometimes with school districts or rural areas where there’s not as much funding that it can be a little more difficult. So I’m wondering if the opposite of that is true. Do you not address needs so much in affluent school districts where they can maybe provide more of those things on their own?
Sy: And then the second part of that is, and this is kind of—your crystal ball is no better than mine, I suppose—but how do you anticipate if, when things go back to students being in school and not being virtual, the impact on what you’re doing?
Kate Eberle Walker: Yeah. On the types of districts, we are seeing different trends. So we typically didn’t work with very many affluent districts. They didn’t have the same need, because it’s all about, can that district … Do they have enough speech pathologists, occupational therapists living in the area to hire and to attract them to come work in the building?
Kate Eberle Walker: And so we tended to see, particularly in wealthy suburbs, they had no problem hiring and retaining those groups. And the challenges were central, very urban districts and the very rural districts. So that was who we worked with. That tended to be correlated with lower income. It tended to be correlated with racial diversity. So that’s always been who we’ve served.
Kate Eberle Walker: What we’ve seen is during this time, particularly with the SaaS offering, with the teletherapy platform and training, now we’re serving—the customer base for that product is more heavily weighted in the affluent districts, because they have the teams and they can afford to invest in more training and technology.
Kate Eberle Walker: So I won’t digress too much in this direction. But I mean, I could talk for a very long time about what … It’s very frustrating to me to see what I see of the inequities across all districts. And I do. I see it every day. The differences in resources and the ability to get services, get technology to these kids.
Kate Eberle Walker: And it is very disheartening. And we are sort of very determined that even as we see the market need shifting, we are determined to keep finding more ways to support these districts that have always needed us the most.
Sy: And in terms of that vision of moving forward when students aren’t so much at home and aren’t so much online?
Kate Eberle Walker: Yeah. For that, we talk a lot about … Most districts have some need for our kinds of services at some point. Before COVID, the greatest challenge was getting them to consider it and try it, and sort of buy into this idea that you could therapy online, or you could do an assessment online.
Kate Eberle Walker: And so this was just a really kind of forced trial for everybody. And it’s a huge breakthrough for us to have had this. I mean, so many more districts have tried. And they’ve seen the sort of pros and cons, the right ways to do things. It’s given us this much more access to our market. So I think that that will always be helpful to us for our services business. I think this has just given us, it’s opened a lot more doors.
Kate Eberle Walker: So I think for that trajectory, it’s really going to help us for the long run. I think we are spending a lot of time now looking at this newer business line and the teletherapy platform and thinking about what about that? How much are we changing work habits?
Kate Eberle Walker: I think, of course, introducing technology into the toolbox for all of these therapists that work in districts, it’s not just that they’re getting to continue to serve the kids when they’re in different locations. It’s putting more therapy activities and planning tools at their fingertips. It’s streamlining the documentation and paperwork. It’s integrating with more engaging video activities. I mean, of course I won’t sell you the whole platform.
Kate Eberle Walker: And there’s all of these things that … in most of those jobs, they’re responsible for kids across multiple sites within a district. So they were losing drive time. They call it windshield time. And that’s very expensive in time and money for schools.
Kate Eberle Walker: So we’re thinking a lot about, how do we really help them change the way they work and come to view these tools as not just a stopgap measure whilst schools are closed. But that’s the big topic in every management team meeting, board conversation, is really making sure that we’re making the most of the opportunity to get to do it.
Sy: Thank you.
Rob Ristagno: I hear you on that windshield time thing because my wife is a BCBA—she’s in this field. And she had a Honda Accord which had almost 200,000 miles on it driving around from different locations. It actually was stolen, and recovered. And she kept driving it till it hit about 200,000. Then it finally failed inspections.
Rob Ristagno: But anyways, I see there’s a couple of more questions. But I just want to talk a little bit about the turnaround itself. It’s January 2019. You’re joining the company, fresh set of eyes. How much of a turnaround is it? You mentioned unprofitable and slow top line growth. How much of it was on fire? What was your assessment? And what did you do in the first 100 days?
Kate Eberle Walker: Okay. When I started, this company, at one point, had had over 150 employees. And when I started, they were down to about 80. And that was partly driven by some layoffs. They had had two rounds of layoffs that had been very disheartening, demoralizing, destabilizing for the company. And then on top of that, there had been a lot of attrition.
Kate Eberle Walker: So I came into 30 open positions that needed to be filled, including a CFO, a controller, a CTO, head of sales, head of marketing. I mean, the list kind of went on. And all but two of the sales reps had quit. So we only had, at the time, two sales reps to cover the country. Although I will say, fun fact, those two reps are still with us.
Kate Eberle Walker: One of them is having the best year in history of the company for any individual rep. She’s already … We measure our year starting July 1st for the school year. So at this point, one quarter in, she’s already sold more than three times her quota for the year. So something to be said for her sticking around.
Kate Eberle Walker: But we basically had all these vacancies. And I needed a team. The Glassdoor ratings were negative, angry, abysmal. So hiring wasn’t going to be easy. So I will say that was also part, weirdly, I guess it was part of the appeal of this opportunity to me. It was that I knew, I had learned from my previous experience, because Princeton Review was quite a turnaround as well.
Kate Eberle Walker: And I had learned that it’s easier to execute a turnaround when you bring in your own people. It’s not the only way to do it. But it is easier. It’s a little more frictionless, I think, from a CEO perspective. So I had this opportunity, I realized, to very quickly bring in a lot of people who I had worked with before, who I knew I could sort of handpick of everyone in my network, who do I think would just be perfect to come in and do this, and solve this problem.
Kate Eberle Walker: And I found pretty quickly that I had this ability to recruit really top talent because of what the company did, because of what the mission was. And no one said no, of the people that I called for all those positions. They’ve all come. They’re all here doing it with me. And I think it was easy to convince people to leave jobs in larger companies to come and really believe in this. So regardless—
Rob Ristagno: You can take some kind of credit for that, hopefully. They’ve enjoyed working with you in the past.
Kate Eberle Walker: I hope. So at least part of it was getting to work with me again. That was the first 100 days was mostly hiring.
Rob Ristagno: And how did that new guard along with the people that were still around?
Kate Eberle Walker: That’s complicated. We had a lot of departures in the first six months. So another thing that I should add is that, when I joined the company, it was based in San Francisco and had been founded there, headquartered there. Back at the time, all our 150 employees had been in the office there.
Kate Eberle Walker: And here I come, and on my first day I announce that, “Oh! I’m a New Yorker. I’m not moving to San Francisco. I am going to stay in New York and I’m going to start hiring here.” And that was not popular.
Kate Eberle Walker: When you know you’re going to go through all this change, you just got to get to know people. I mean, it’s back to what we were talking about earlier. You get to know people, one-on-one, one by one, and you figure out that some people are going to lean into it, and they’re going to be excited for the opportunity. They have ideas. People who had been at this company for years knew it way better that I did when I first came in.
Kate Eberle Walker: And I knew some of them, they’re going to have idea of things they think we should do, should have been doing. And I just sort of … I spent a lot of time in those first days as well just meeting one-on-one and giving people that opportunity, if they wanted, to step forward and share their ideas. And a lot of those people who did are really critical parts. They’ve been promoted over these past couple of years. They’re really critical parts of the company. But we did have about 40 people leave in the first year.
Rob Ristagno: Got you. And was any of that related to the fact that you took over from the founders? Or what were some of the other implications of taking over from the founders?
Kate Eberle Walker: Yeah. I mean, the thing about founder-led businesses is there’s this emotional connection from the company to the founder and the founder to the company that is, it’s there. And it’s different. It’s different from, I think, the relationships and connections of every outside CEO who comes along later.
Kate Eberle Walker: And I kind of learned you’ve got to recognize that it’s there. And it doesn’t go away. I mean, it never goes away. I mean, I think when I was at Princeton Review, I remember one time I’d asked the tutoring manager to take care of a VIP that I sent her way. I said, “Find a really great SAT tutor for his daughter.”
Kate Eberle Walker: And so, “Okay, great.” So she goes and does that. And the finance person came into my office a couple weeks later and was like, “Oh! I need you to sign off on this tutoring credit.” And it was thousands of dollars. And I was like, “What is this? Why would I sign off on this?” And he’s like, “Oh! Well, I think you said to take care of the VIP.”
Kate Eberle Walker: So I go get the person I’d asked. She comes in. And I’m like, “I didn’t say give it for free. I just said get a great tutor.” And she was like, “Oh! That’s how John wants it done.” And John Katzman was the founder. And there literally had been five CEOs between John and I at the Princeton Review.
Kate Eberle Walker: So you pick up on things like that and you realize that the founder will continue … People will continue to listen to the founder long after the founder is gone. And that’s really nice in a lot of ways, that connection to the origins, the origin story of the company. But you have to be aware of it when you come in next and really sort of be alert and understand what are some of the ingrained assumptions that are happening here in the business?
Kate Eberle Walker: And what of those do I want to change? I need to be explicit, very, very, very explicit with people about changing. And what of it do I want to embrace and turn it into something that’s really part of the character that the company is. So you got to be just really … There’s a lot of hidden habits that I think are different that you just want to be aware of.
Rob Ristagno: That’s a good point, because I imagine you want to keep some of them, but some of them just need to change.
Kate Eberle Walker: Yeah, exactly. And people get that. The nice thing, too, is you have this relationship with this founder who … Actually, you do have this other person who cares about the company as much as you do. We talked before about that infatuation. And nobody cares as much as you do when you’re the CEO. It’s actually different when you take over from a founder. That founder continues to care as much as you do. And that’s different too, and I think really nice from my perspective.
Rob Ristagno: So you’ve done this before, it’s not your first time being a CEO. You’ve mentioned you got to bring your own team with you. What were some other advantages you had as a seasoned CEO that maybe first-time CEO Kate might have made a mistake?
Kate Eberle Walker: I mean, a lot of it just comes down to trusting your own judgment. I think it’s actually very similar to parenting. You’re very daunted with your first child. And you think that there’s a right way to do everything and you just don’t know it yet. So you’ve got to learn it and figure it out.
Kate Eberle Walker: And then you realize, or at least don’t tell my younger daughter if this isn’t true, but I feel like I realized by my second one, like, you know what? My own intuition about what the right thing to do is is better than any other fact out there. So I got to have more confidence. And if I think something is the right thing to do, I should do it.
Kate Eberle Walker: So I just moved a lot more quickly the second time around, and had more confidence that if every sign was there for me that I needed to make a decision or change something, I should just go ahead and change it.
Rob Ristagno: What is that calculus that’s going on in your head when you’re making a decision? How much are you relying on data and facts versus experience, intuition, other people’s opinion? I know it’s complicated. But what’s going through your head?
Kate Eberle Walker: I mean, I definitely, according to a lot of the sort of behavioral analysis and assessments that I’ve done over time, they test any person coming from that world, I definitely over-rely on intuition. And I usually start from, “I think we should do this. Or I think I want to do this. Let me go and gather some data to prove or disprove it.” And then once I get to kind of decent-enough confidence level, I’m like, “Okay. Let’s do it.”
Kate Eberle Walker: And that’s different with every company too. I mean, right now, because I am in something that’s high growth and still early-ish stage, it’s kind of fun for me, because I feel I have more luxury to do that. And it’s better to err on the side of moving quickly than to be too deliberate. So I do rely on intuition.
Kate Eberle Walker: But also something that has always worked for me is, because I know that that’s my own tendency, the executives that work with me, that I bring onto my team, are all super opinionated and vocal about it. No one is afraid to debate me and call out when they disagree. So we have very lively management team meetings. But I sort of surround myself with people who often talk me out of my own intuition.
Rob Ristagno: All right. Important to have those people who can keep you honest. Al, you have a question?
Al: Yeah. Something just hit me. So going back to your work in COVID, have you given some thought to what happens after a vaccine?
Kate Eberle Walker: Yeah. I think, because school will come back in session, and we all want that. We’re certainly not rooting against it. I think, for us, first of all, I’ll say, it makes us probably particularly manic in pace right now, because we feel like this is our moment of opportunity to get connected to as many clients, as many school districts as possible.
Kate Eberle Walker: And when we do, we’re thinking about the reason that we were brought in was to help with something that happened because of COVID. But once we’re in, what are all the conversations, what are all the things that we need to be talking about to find those longer-term opportunities. That this is the season of cross-selling, upselling, finding what the longterm need is going to be. So we think about that a lot.
Kate Eberle Walker: And then I think there will be a more permanent shift in online education services, online services in general, probably. Maybe not in the school district itself, but with parents, with private practice. So we’ve accelerated, we are already kind of working on a growth plan around proving services directly to the private practice market. We’ve accelerated that because I think there is a marked trend in that direction of parents getting, wanting to take on more direct involvement in sort of finding services for their kids.
Rob Ristagno: We have a question from Mark in the chat box here. What were the best tactics you used to uncover student opportunities? Basically, how did you do your market research, focus groups, surveys, one on one interviews, et cetera?
Kate Eberle Walker: We do a lot of market … Market surveys are good. I don’t know. Maybe in all markets. But I find that we’ve worked with some groups that are going and doing surveying of districts, professionals, administrators. We’ve gotten so much data that helps us zero in on which districts are going to be the right match for what we need. Which districts are likely to have the most significant need?
Kate Eberle Walker: And I’ve actually got to give Bain a ton of credit there. I mean, having a fund like that that is so analytical and so resourced in those areas has actually been a dramatic change for us for our sales targeting. I mean, the amount of research they did in this spreadsheet, a beautiful spreadsheet, that they have created.
Kate Eberle Walker: I mean, it’s really allowed us to get much more scientific about tiering out our opportunities and focusing efforts. So it’s data. I mean, there’s a lot to be taken from analyzing the size of the district, the percentage of the special education population within, the income profile, the racial profile. They all correlate to what makes a good customer for us.
Rob Ristagno: I want to shift gears now so we can learn more about your book coming out March 9th, The Good Boss: Nine Ways Every Manager Can support Women At Work. How did you come up with the idea?
Kate Eberle Walker: I started out, actually, I get asked for advice from a lot of women about, “How do you break into the C-suite? What’s your advice?” And so I started out, I wanted to actually write a book about that. And I thought, “Well, I’ll interview all these successful women I know about and they’ll tell me about their success strategies. And I’ll put them on the book.”
Kate Eberle Walker: And I started doing interviews. And nobody really had these strategies to share. I kept getting like, “I’ve never actually applied for a job. I’ve never actually asked for a raise.” And as I kept working through those conversations, I always got to this common endpoint where they said, “I just had a really good boss. I never had to ask for those things. I had a boss who gave me promotions, who pushed me to do that, who dealt with that issue for me.”
Kate Eberle Walker: And so that was how I kind of got to what the book is, which is, I realized the single greatest determinant of the success of whether talented and successful women will succeed appears to be her boss. So we need to create more good bosses who care about supporting women and who take it on as their responsibility.
Kate Eberle Walker: And the majority of managers are men. And I wanted to write something that, more than anything, spoke directly to them and said, “Let’s not leave this to women should mentor women. And women CEOs should cultivate the next class of women CEOs.” Because there aren’t enough women CEOs to do that and have an impact. I mean, we need the men to commit and to be a part of it.
Kate Eberle Walker: And so I wrote this book from just a really practical perspective of advice for male managers, for all managers, but particularly male managers, of like, “Here’s some things that you can do that will have a huge impact.” And some of them are small but they go a long way to really creating a better working environment for women.
Rob Ristagno: Okay. I have to ask. What is a common thing that men do that’s really obnoxious that we just don’t realize is bad?
Kate Eberle Walker: It’s actually getting names wrong. So the first chapter of my book is Call Her By Her Name. And there’s a lot of layers to that. There’s terms of endearment which are … It happened in a meeting yesterday. You hear people thinking, “Yeah. We know ‘don’t call somebody honey.'” But people do it. They call me young lady.
Kate Eberle Walker: So no terms of endearment. Nicknames. People think I’m Katie. I’m like, “I did not introduce myself as Katie. That’s not my name.” Or they just get the name wrong. And there’s all these statistics that show, of course, you could a man’s name wrong, too. But statistically, it happens to women far more often in the workplace that somebody mistakes their name, or uses a nickname that they didn’t choose, or uses some other term. So that’s the biggest one.
Kate Eberle Walker: Oh! And then, sorry. I could go on. When she gets married and changes her last name, a lot of people continue to get it wrong, forget the change, dismiss the change. That happened to me a lot. People saying like, “Oh! I’m just used to calling you Kate Eberle. I can’t change.” And it’s like, “You could remember someone’s name has changed and you could give them the respect to call them what they asked you to call them.” So get her name right.
Rob Ristagno: All right guys. Get her name right.
Sy: I want to jump in on that if you don’t mind.
Kate Eberle Walker: Yeah.
Sy: I want to say three very quick things to you from what you just said, Kate. I am, I think, an outlier on this group here today. I don’t know. Is that accurate?
Rob Ristagno: It’s true. Go for it.
Sy: Okay, because you know what I do. Thanks.
Rob Ristagno: Yeah.
Sy: So I’m a writer and an actor and a director. And so there’s three things I want to say. First, as an actor, I have two agents. One is in New York. I’m in Connecticut. And one is in Connecticut. The one in New York is a man and the one in Connecticut is a woman.
Sy: And I was working with the man in New York for years. And he constantly would call me Sigh, which kind of drives me crazy anyway because I just kind of really hate. I like my name and I just don’t like that.
Sy: And one time he did it, and it was just after so many times. And he called me up about, I don’t know, a job or an audition. And he said, “Sigh.” And I went, “My name is Sy (pronounced: Cee).” And he said to me, “What’s the difference?” I’m not kidding you. He said, “What’s the difference?” That’s the first thing I want to tell you.
Sy: The second thing that I want to tell you is … Maybe I forgot the third. I’m just going to go to the others. I’m also a teacher. And when I was still in New York, I did work in the school systems for a while.
Sy: And I will tell you that I’m so big on Ms., M-S, and what that means. And I cannot tell you how many schools that my daughter has gone to, and that I have worked at where Ms. has only just become a substitute usually for Miss, so that all the teachers are either Mrs. or Ms. And I have written articles, blog articles, trying to explain once again that Ms. is the female counterpart to Mister, which does not designate marital status.
Sy: And it’s so lost. People don’t get it. And when I talk to younger people, they have no idea what Ms. is anymore. But even my peers who were around when that first came around, sometimes they just have no idea.
Sy: So, I’m sorry to jump in there. But I had to just jump in on what you were saying with some of those —it drove me crazy that he literally said to me, “What’s the difference?” And that people don’t understand that there’s a title when you talk about changing your name. That there is also a title that we have the right to chose that doesn’t designate marital status. But that’s gotten lost. Sorry. Those are my [crosstalk 00:57:11].
Kate Eberle Walker: It exactly demonstrates why it’s important and it is rampant.
Rob Ristagno: it doesn’t seem hard to implement. So guys, come on! Get on the ball here. Hey! This has been phenomenal. Thank you so much for spending your time with us. What can the group do to help you out?
Kate Eberle Walker: Well, we are hiring more people than ever. So if you have talent that you think … We like to find people who are obviously very talented but also who are drawn to our mission. And I do find there’s a lot of people out there who have had a personal experience with speech therapy, or someone in their family did or really benefited from getting counseling when they were a student.
Kate Eberle Walker: So if you know anybody who’s really, feels the connection to this area and is passionate, I would love an introduction because we’re hiring in sales and in marketing and product and engineering and finance. We’re hiring everywhere as we grow this year. So I’m just always looking for people that will really be into what we do.
Rob Ristagno: Great. So if we know someone, how can we get in touch with you, or go to your website, or what’s the best way for us to suggest some folks for you?
Kate Eberle Walker: The best way is LinkedIn. And I hope you all connect to me on LinkedIn. And I’m always active on there. And if you want to introduce anyone to me, or send a message, I can obviously fill in others to reach me from there. But that’s the best way to set up the connection.
Rob Ristagno: Kate Eberle Walker, CEO of PresenceLearning. Virtual round of applause. Thank you so much. This has been the CEO Campfire Chat. To listen to more episodes, subscribe to our email companion or take a two-minute growth assessment, visit ceocampfirechat.com. This is Rob Ristagno. See you again next time around the fire.
Rob Ristagno: This episode of the CEO Campfire Chat podcast is brought to you by the Sterling Woods Group. Middle-market executives and private equity investors need to achieve rapid revenue growth but face limited resources and time. We’ve developed a proven system to quickly and confidently uncover your best opportunities for growth so that you can scale up and maximize exit value. To learn more about our proprietary data-driven approach, check out sterlingwoods.com.