Unlike most CEOs who leave one private equity opportunity post-sale and wait for the next one to come around, John French has decided to take a different path. Following the divestment of Cygnus in five separate transactions over five years, French will not be looking for a job as a media company CEO—for now at least. Instead, he wants to share his experiences at Cygnus with other executives. Here, he speaks with FOLIO: about what he’s learned from his time at Cygnus and how he’s leveraging that into his own strategic advisory firm for B2B media leadership, called French LLC. Omeda, the integrated marketing company that was instrumental in giving Cygnus a serious tech backbone even as the company was prepping for sale, is French’s first client.
FOLIO: Describe your new venture—it’s not just consulting services, correct?
John French: It’s not a typical consulting role. It’s more of an advisory role. Consultants tend to be formulaic, bringing in a particular structure. The advisory role for me is different. You need the practical experience at the highest level before you can go into a role like this. I’ve lived this. You don’t come in and say, ‘This is our consulting formula.’ Instead, you have a discussion with the executives at the highest levels. Then it becomes a strategic and tactical execution—strategic planning on what the next couple of years are going to be.
FOLIO: Could these projects lead to another CEO job for you?
French: I’m not doing it to get the CEO job, but I do want to make companies more competitive.
FOLIO: You must have learned quite a bit about media M&A during your time at Cygnus, not to mention the dynamics between management, the banks and the board.
French: Yes. The other part of French LLC is acting as a broker. There are a lot of small companies that I know, where I can talk to the principals one-to-one. Market position is valued above everything else. In general, the M&A environment is stronger now, but there’s a line below which people just don't have an interest. And there are a lot of people who own smaller companies out there and who want to unload. They don’t want to live through another recession. They know the M&A market is strong, but every time they put up their hand, buyers say, ‘No, you’re too small.’ But I do think there’s an opportunity to cobble together several small companies and look for buyers who are looking for smaller positions. Or maybe bundle something and sell it as an uncomplicated M&A facility.
The third part is board seats. I can help boards communicate and help lead management teams for a short time. It’s about being an advisor to companies that want to change and get better. And not in a threatening way to the current management team.
FOLIO: Part of the value you’re offering to your clients is a specific vision into what has become a very confusing future for B2B media. What are some of the trends you’re focusing on?
French: Rollups are going to occur in B2B in defined market positions. A company will want to own all of construction or IT or whatever. The future of multi-market companies is very limited. So I’ll be talking to folks about concentrating and dominating in a single market.
But for me it all comes down to technology—the integration of the database. Run your business day-to-day, but concentrate on the database and what you can do to monetize it. I don’t worry so much about a company’s percentage of print versus events versus digital. It’s important, but most companies are not that high in print. If you get down to 40 percent print and it’s still contributing to the bottom line, take that cash and move it over to data and digital and continue to monetize those. The problem is, CEOs have this formula in their minds. ‘If my print is declining, I have to make it up in digital.’ If you’re down $1 million in print and $400,000 in margin, don’t just sell more enewsletters. Move to the next level of lead traction and monetization of the database. We need to be getting more from the consumer. If we can move companies in that direction, replacing the $400,000 margin is a lot easier.