What's in this session?
- Origins of Ministry Brands (8:21)
- The acquisition strategy that Ministry Brands employs (10:20)
- President of Ministry Brands responds to the negative perception of Ministry Brands in the church space (15:57)
- The poor reviews of Ministry Brands on Glassdoor (16:46)
- How Ministry Brands manages 600+ employees working at 10 different main locations across the U.S.A. (25:24)
- The first acquisition of Ministry Brands to acquiring 25 brands in 5 years (28:12)
- Responding to The Wall Street Journal Reports of Ministry Brands exploring a sale of the company for more than $1 billion (32:47)
- Managing the tension of maximizing profits for investors while still trying to serve churches well (41:00)
Show notes and resources
- Ministry Brands
- Site Organic
- The Rocket Company
- Shelby Systems
- The Emerging World Of Church Software with Eric Hoekendorf
- 3 Emerging Tech Trends Affecting Churches with Kent Woodyard
- Wall Street Journal acquisition report
3 Instant Takeaways
- The ‘so what’ of Ministry Brands is to minimize competition in the church space so that more time can be spent progressing and working together.
- Change is hard. It’s difficult being the first in any space. Brad has felt this first hand as a larger corporation in the church space, especially when the change over in ownership can seem sudden to employees of the smaller companies that have been purchased.
- “The money side takes care of itself.” Brad believes that making money should never be the sole goal of a company. Rather contributing to a space; filling the needs of your target audience, should be the goal. When you do this well and with wisdom, the money will naturally take care of itself.
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Brady: This is the Pro Church Podcast, session number 150, The Master Plan of Ministry Brands with Brad Hill. Well, hey there Pro Church nation, and welcome to the Pro Church Podcast. You’re now part of a small group of pioneering churches doing everything we can to seize the 167 hours beyond our Sunday services. Why, because we’re living through the biggest communications shift it the last 500 [00:00:30] years and what got us here, won’t get us there. I’m Brady your host, and this is session number 180. You can find the show notes for this session at ProChurchTools.com/180, and in this session we are joined by Brad Hill, the head of Ministry Brands. We’re discussing their master plan for church tech, so let’s do it.
[00:01:00] Well, hey there, and welcome back to another session of the Pro Church Podcast. This is Brady, your host, thanks for joining us in this 180th session. We like to start off each and every show by sharing with you a pro tip or a practical tool that you can begin using in church or ministry right away. Today I want to share with you a tool called ProofMe, ProofMe.com is the URL where you can track this down. Basically, ProofMe is a tool [00:01:30] that’s basically made for content collaboration for creative people. You know, basically, when we begin working in our own creative ways, whether that be something like a video or a graphic, or any type of creative endeavor, a lot of the times, especially within a church, it’s helpful to get some other people to proof it.
So, look over it, to give their suggestions. You know, the classic way was basically everyone would huddle around the same computer and everyone would, kind of, give their feedback, but that can make things a little bit tedious, right? What if not everyone is in the [00:02:00] building at the same time, or what if not everyone is available at that moment, they’re in a meeting, but you’ve got to get stuff done, or whatever it might be. So, ProofMe, it’s built to handle videos, images and text, and it’s meant to carry you through the entire creative process. All the way from, you know, V-1, the earliest version, to absolutely finished, iterated, approved and done.
Basically, it’s meant for designers, photographers, videographers, marketers, project managers. I have not used this tool personally, but I’ve seen it pop up [00:02:30] amongst people that I highly respect, again and again, saying, “Look, this is the best way to collaborate when it comes to creative work, when it comes to videos, images, text.” You can share the work with the contacts, collaborate with anyone. It integrates with Slack, Dropbox, Basecamp, Photoshop, Google Drive, and obviously, it enables very clear feedback. Where you can see real time comments and edits, you can manage your products, sorry your projects. Overall, just improve the workflow of everything you’re doing from a creative mindset.
So, I highly recommend that you check it out, not because [00:03:00] I think it’s awesome, but because people who I think are awesome, think it is awesome. You can go to ProofMe.com to check that out, see the product, how it integrates, the pricing, and learn more about their story. If you are having trouble collaborating within your church, on anything when it comes to video, images, or text, I think this might be the answer to that problem. So, go check it out, ProofMe.com, and that will also be linked in the show notes at ProChurchTools.com/180.
With that being said, we are inviting onto the Pro Church Podcast [00:03:30] today, Brad Hill, and Brad leads the team over at Ministry Brands. He’s been in the church tech business for over two decades now, started in the web and CMS space, gradually branched into areas like online giving, CHMS messaging. He’s a lifelong learner, self described, and basically what Brad and the team at Ministry Brands have done, is nothing short of remarkable over the last five years. Something that we haven’t seen in the church space as of yet, and Ministry Brands is really, kind of, the first example of that.
With that being said, [00:04:00] a lot of controversy has gone along with that. In full transparency, Brad reached out to me after we’ve had a couple of, either ex employees, or people that have worked with Ministry Brands in the past, he, kind of, reached out to me and said, “Hey, I’d love to come on the Pro Church Podcast and share our story.” So, I was much obliged. You know, we, kind of, set the terms, and I was like, “Okay, if I’m going to bring you on, I want to make sure that we’re able to actually talk about real stuff.” You know, not come on and it be a PR stint, like, this is where I want to actually get into the deep stuff.
So, in this session [00:04:30] we talk about the origins of Ministry Brands, the acquisition strategy that Ministry Brands employs. The President of Ministry Brands, Brad Hill, we actually allow him to respond to the negative perception of Ministry Brands in the church space, which does exist. We talk about the poor reviews that Ministry Brands has on Glassdoor. Glassdoor is, kind of, an anonymous “review your company” website, and Ministry Brands has a variety of not great reviews. So, I asked Brad, “Okay, you’re the President, what would you say to this?”
We talk about how Ministry Brands manages their 600 plus employees [00:05:00] at 10 different location across America. The first acquisition of Ministry Brands, and then how they managed to acquire more than 25 brands in five years. Responding to the Wall Street Journal reports of Ministry Brands, exploring a sale of the company for more than one billion dollars, and finally, managing the tension of maximizing profits for investors, while still trying to serve churches well.
This is the crux of the entire conversation because Ministry Brands is one of the very first companies, most definitely the [00:05:30] first conglomerate that is taking huge sums of money from investors. Now it’s not public equity, its private equity, but what that still means is that, unlike a company like Pro Church Tools, like most companies in the church space that are bootstrapped, meaning no one gave us money to do this, we did this ourselves, which means we only have to answer to our customers. Ministry Brands has to go forward managing the tension between serving their churches well, but also serving their investors well, who gave them the money and want to maximize their profits. So, we talk about that tension [00:06:00] and how Ministry Brands is planning on managing it moving forward.
So, plenty of great stuff in this. It’s a little different than what we would normally do on the Pro Church Podcast, admittedly, but it’s going to give you a great insight into, behind the scenes of how companies work and into how so many of the companies that you are familiar with, and perhaps even use, are managing behind the scenes. Really, how, for the first time, the church world is being infiltrated by a type of equity and business management strategy that has only existed [00:06:30] outside of the church world up until now, at least as far as I know.
So, plenty of great stuff in this. I hope you find it enlightening and with that being said, we’ll be back in just a moment with my interview with Brad Hill.
Well hey there Pro Church nation. Welcome back to another session of the Pro Church Podcast. Great to have you along for the ride with us. Today on this session we’re joined by Brad Hill, Brad, welcome to the show.
Brad Hill: Thanks Brady, good to be here.
Brady: It’s great to have you. If people are unaware of who you are and what you do, can you tell us a little bit about yourself, and the great work that you’re involved with?
Brad Hill: [00:07:00] Absolutely. So, I am President of a company called Ministry Brands. I am sitting here in Knoxville, Tennessee, which is our main office. We have about 600 people around the US, primarily. I think we’re all in the US, we may have a couple that may be off on a mission trip today, but for the most part we focus in on all the different aspects of technology that serve churches. So, that includes a range of things.
I’m sure we’ll, kind of, get into that more, but [00:07:30] everything we do is, kind of, designed to help equip churches to get optimized on how they’re thinking about technology, how they’re reaching people. You know, the changes out there happening in culture, what should we be doing as a church to respond? So, that’s come, and my role, specifically, is to look out at how we’re doing operationally, make sure that we’re serving customers well. The business has what it needs to keep going and be sustainable.
Brady: You said, over 600 employees, which I think has [00:08:00] got to put you at the top, near the top, of one of the biggest church software, church tech companies. Can you talk a little bit about the origins of Ministry Brands? I know that you’ve been in the church tech space for more than two decades, has Ministry Brands been around for that long, or what’s the origin story for you and then heading into what Ministry Brands is today?
Brad Hill: Sure, yeah, so Ministry Brands, really, in a nutshell, is a collection of various companies, firms, that all got their start somehow serving [00:08:30] churches with technology. I am a great example of that. The company I started several years ago was called Site Organic, and we had our start in content management, website design for churches back on the east coast. A lot of our companies in Ministry Brands are the same way. They had some start, maybe with somebody at a church, or somebody who was even on staff at a church and saw a need and decided to build tools to solve that need.
[00:09:00] So, about five years ago, so 2012, a few of us got together and said, “It would seem like it would make sense if we could certainly partner, but maybe something deeper than that. If we got together and can leverage, you know, we’re both serving churches, but we’re doing it in different ways.” So, if we could leverage what we’re good at, and what we’re doing, would that allow us to come to those churches with more? So, Site Organic, my company, and then two other companies in the online [00:09:30] giving space, got together.
So, we were, sort of, the first three, if you will, to join together to become what you would now think of as Ministry Brands. So, there’s, sort of, a dual answer to your question. Ministry Brands as a company has been around now about five years legally, but we have companies in our family that have been serving churches … I think our longest running firm would be Shelby Systems, that just celebrated their 40th anniversary. So, [00:10:00] if we’re feeling extra, you know, generous, we’ll use their longevity to say Ministry Brands has been around a long time, but really it’s been in these last few years that we’ve established and grown this concept.
Brady: Okay, cool. So, around five years, and can you talk a little bit about the process of acquiring companies and, kind of, the goal/strategy behind that as a whole? I think you’re uniquely positioned in the church software space, for sure in that respect.
Brad Hill: You know, it’s a [00:10:30] great question because I think prior to this Ministry Brands story, and sometimes I even call it an experiment. There really hasn’t been a lot of history of acquisition in the church space. There have been a few, there’s been a number of smaller ones that I’ve seen, or been part of, but the only real notable one that we hear a lot would have been Fellowship One that got acquired back in 2011, which predated anything to do with Ministry Brands.
[00:11:00] I think that there’s a natural and understandable skepticism about acquisition because, quite frankly, I think it, in some cases, it hasn’t been handled well, or the original goal of that company was somehow lost, or diminished, as part of that experience. So, we know that story, in fact the example I sited, Fellowship One, they happen to be a long time partner of mine, I know a lot of the founders and folks over there. [00:11:30] What we look at, why do this? Like, why acquire companies? How is this helping churches? One of the things I do, Brady, a lot to keep myself grounded, is I talk to as many pastors and church staff as I can. That’s not as many these days as maybe it used to be, but I’m pretty intentional about getting myself out there.
You know, a lot of times, I’m talking to them, not to promote or sell anything, I just want to hear, you know, “Hey, what’s going on in your world, and what keeps you up at night?” Probably the pain point [00:12:00] that I hear the most, I’m not sure if this is true of your listeners, but I hear a lot about issues with technology vendors. You know, people will say, “I’ve got one company for my database or CHM apps. I’ve got somebody else for my website. I got this guy over here doing my volunteer screening, or mobile app, or whatever.”
You could list out eight or ten things, and when you get to that point, if its different vendors, yes they have API’s, [00:12:30] yes they tout integration, but talking directly to the churches a lot of times the story is, “Man, this just isn’t going as smoothly. We’re having trouble, they’re pointing fingers at each other. This isn’t, maybe, what I feel like I signed up for.”
So, we look at that and say, okay, there are a lot of, what I’ll call mom-and-pop, smaller shop companies, carving out a little niche somewhere in church technology. I was one of them, right? I think that there’s a ton of people out [00:13:00] there serving the Kingdom, and very passionate about it, but they, if we’re honest, they are spending a lot of their energy competing with each other. So, we sat back and said, okay, just on its face, what if we could get some of the best people, some of the best resources, the best tools, the best ideas together and actually be on the same team, all rooting for the church, going in the same direction?
So, that really is, kind of, the “so what” of Ministry Brands, is just to say … [00:13:30] The example I like to use a lot is child check in. Okay, so that’s a pretty understandable concept. I counted one time, at least 29 different child check in solutions that are out there, there’s probably more that I missed. You know, honestly, I don’t know if the world needs 29 child check in solutions. It doesn’t need just one, I think there’s something really great and beautiful about competition, but you know, we would say, “Okay, let’s get some great minds together and figure out what’s [00:14:00] the absolute best, cleanest, you know, most excellent child check in execution we can come up with to serve churches, and let’s put our energy there?”
That’s a tiny example, but over time, and we’re no where near where we envisioned going as Ministry Brands, but we really want to see a more holistic approach to the way churches use technology, and the way they buy technology. We think we can streamline that for them.
Brady: Can you like, just [00:14:30] name some of the most well known brands that you guys have now in your family of software? So, that everyone in Pro Church nation can get a picture of, “Oh, that’s actually a Ministry Brands brand now, I didn’t know that.”
Brad Hill: Absolutely, and I will gladly do that and also direct anybody that wants to go to MinistryBrands.com. You can’t buy anything there, so that’s not a plug, but we do have a page on there that, kind of, has a list of the brands. So, if you want to-
Brady: I’m looking at it right now.
Brad Hill: Yeah, so if you want to look at that, but … Yeah, so I mentioned Fellowship One earlier, [00:15:00] having been acquired by another party. We in turn actually did acquire Fellowship One, so that’s one of the brands a lot of folks would know. Shelby I mentioned earlier, those are both, kind of, in that church management space. Then you have in the online giving sphere, you would have Easy Tithe as one of our … That was actually one of our earliest acquisitions. On the web side you have Clover, you have Ekklesia 360. Background checks, we have Protect My Ministry. [00:15:30] Let’s see, for … We actually have a pretty strong offering also in the Catholic space, under the guise of a brand called ParishSoft.
So, that’s a hand full right there, but as I said, feel free, you know, anybody that wants to check out MinistryBrands.com, can get the full rundown. Even sometimes, we, have a hard time keeping up with the list.
Brady: Yeah, totally, I get that. So, let’s dive into some of the more juicy details because originally what happened was, you reached [00:16:00] out to me, and were very open about coming on podcast and talking about Ministry Brands, and perhaps some of the perceptions that are out there. It was pretty timely because we had just had two former, I believe, former employees of Ministry Brands, or brands that were then acquired by Ministry Brands. We had Eric Heckendorf, who was working with Clover, and then we had Kent Woodyard, pardon me, who was working with MoGiv. Both … Correct? MoGiv and Clover, both part of Ministry Brands?
Brad Hill: That’s right. You got it.
Brady: Okay, cool.
Brad Hill: Mm-hmm (affirmative)
Brady: So, and [00:16:30] both … I don’t want to pretend that I remember each of the conversations 100% with clarity, but I’m pretty confident that, I wouldn’t say they were entirely complementary of their experience. You know, if you go and search Ministry Brands on a site like Glassdoor, Glassdoor is a site where you can leave anonymous reviews for the company that you work at, kind of like, Rate My Teachers, back in high school, but for actual companies. Like, I think you have 44 reviews around 3. [00:17:00] 3 stars, which isn’t entirely great. You know, there are some that are like, “Hey, this is just a greedy cash grab”, you know, “Our company was bought by Ministry Brands, I stuck it as long as I could, but it became clear that this was not what I wanted to be a part of.”
I would just like to give you an opportunity to respond to those things that are being said, because I think there is this perception for those that know about Ministry Brands, which not everyone in Pro Church nation necessarily does. So, what would you say to these types of things?
Brad Hill: Absolutely, I like how you framed that Brady, and yeah, you’re right, I [00:17:30] approached you. I’ve been a listener and followed you, I love what you’re doing. I like to, kind of, eat up everything church technology wise. That’s definitely an area of passion for me. So, to really, kind of, get into where you’re headed with respect to some of those comments that are out there. I think that’s a totally fair question, and I would preface it just by saying that change is hard, and we get that, and I’ve lead teams for a long time. These are like family to me. I referenced a few minutes ago, [00:18:00] kind of, that mom-and-pop nature of a lot of the companies.
Deep within the stereotype of mom-and-pop, you have companies that are small, meaning, you know, anywhere from five to maybe 50 employees. You typically have a founder that’s been there a little while, maybe all the time, and you have a sense of family, and a sense of belonging, and a sense of purpose. Then the employee shows up for work one day and they find out, “Hey, we’ve been acquired. What does that even mean? I didn’t really choose [00:18:30] this, I just came here because I’m passionate about bootstrap framework, or I’m passionate about SQL databases and I want to serve the church with that skill.”
So, that aspect of change is very hard because, other than the owners who sell these companies, the typical pathway is that the employees have no idea what’s going on until the announcement is made. So, that’s a pretty big pill to swallow on that first day-
Brady: Hey, let me just jump in there for a sec. Is that, kind of, like, normal for acquisitions, that employees would be left [00:19:00] in the dark? Is that … I’ve never been a part of one, and I haven’t worked at a company that’s been acquired. Or is it normally, like, an open dialogue, or is it, kind of, like, NDA’s, you can’t talk about it?
Brad Hill: Yeah, that’s a great point. The answer is, it’s really up to the seller. So-
Brady: Oh, okay, okay.
Brad Hill: The owners can do it however they want. Having been a seller myself, I can say that until we know with certainly what’s going to happen and when it’s going to happen, you know, I care so deeply about the people that I’ve hired and grown [00:19:30] all these years, that I want to make this a good transition for them, and I want to make sure that they’re clear about what this means for them. Will they have a job? Will they have a role? Can they grow?
So, for that reason, although it feels, to be honest it feels really weird to have to, kind of, you know, do this in secret, I’d say the vast majority of sellers will choose that path. I will also say that we’ve learned, having done so many of these, that the more communication and planning that can happen before [00:20:00] the acquisition closes, the better. It just makes a way better experience going forward.
The reviews and things that you referenced, Brady, on some of those other websites, they are out there. You know, with the change that comes when you acquire a company, no one ever is seeking to negatively affect anybody, right? That, there’s no … There is no example in Ministry Brands, where we have said, “You know what, we’re going to buy [00:20:30] that company and lay off everybody”, or, “We’re going to buy that company because we can do it better, and we don’t need the people.” What you actually find is a lot of examples where we will acquire a company, and we’ll see some great talent.
In fact, we have one we’re working on right now that I, unfortunately I am under NDA, so I can’t discuss a name, but there’s some fantastic talent there, and they’re doing a great job in that company. We actually look at that and say, “Those people could help in a bigger way in Ministry Brands.” There’s, [00:21:00] I can’t even count, how many examples, probably over 100 examples of people who have come in through an acquisition and are now working in a totally different job. They may sit in the same chair, in the same city, but they’re working, doing something totally different in another part of Ministry Brands.
Let’s acknowledge that there are situations where we do bring a company in, and for various reasons the staffing level they have, or the talent they have, doesn’t make sense for where the company might be going. [00:21:30] So, that creates a really, just, kind of, a bummer situation, right? So, there have been cases where either we’ve had to make those decisions, the former owner had to make those decisions, or the people themselves did. You know, I can’t, of course, speak directly to any single persons’ situation. I don’t really even want to address the two folks you’ve had as guests, just because I respect them a lot.
Suffice it to say, I mean, if you’re on the receiving end of, “Hey, [00:22:00] today’s your last day. It’s time to go find something new”, that’s a tough pill to swallow as well. So, that’s a hard thing, and we get it, people want to go vent. Where it gets tricky is people are going to aspire motive or, maybe, kind of, fill in blanks where they feel like they need to, and we generally … You and I were speaking about this before we started the recording, we don’t tend to try to get into the debate [00:22:30] back and forth on forums like that. I just don’t see a lot of value in doing that. I’m way more a fan of going one on one and talking to somebody. We want to respect people’s dignity. We want to find talent at home where we can.
So, we’re generally not going to engage in some of those forums that are out there. I would far prefer to build a great team, an engaged team here. So, when they see people out there saying, “Man …”, like some of the quotes [00:23:00] you sited a minute ago, they can come back and say, “You know what, I work for that company too, or I was part of that acquisition, and let me tell you, that was not at all my experience. We’ve had a totally different experience there.” So, that’s … I’d much rather put energy there as opposed to just some corporate marketing person going out with a boiler plate response.
Brady: So, obviously Glassdoor, if you’re unfamiliar with it, it’s an anonymous website. So, you leave an anonymous review [00:23:30] of your employer. So, let me ask you this, Brad, we know what’s out there on the internet and obviously, I think I know the answer to this, but I want to ask you anyway. Of the 600 plus employees that you have currently, the ones that have been laid off throughout acquisitions, would you say that the sentiment is generally positive more than negative? Or, how would you gage the experience of those being acquired, transitioning into new roles, leaving, and the like?
Brad Hill: Yeah, I would say … Well, I mean I [00:24:00] can answer that with data just because we take employee engagement pretty seriously. We’re not the best at it, but we’re getting better, and so we do sample and survey, and do a lot of individual check ins with folks. I can tell you, you know, for those who know what NPS scores are, we have a numerical rating that tells us exactly what our people think. We take comments, we do a survey out of Marcus Buckingham’s book, called First Break All the Rules, where there’s 12 questions we ask, [00:24:30] and the numerical responses to those, we have greater than 90% positive amongst our people.
You’re going to see comments in there, like, “I’m so excited to wake up every day and work for a company that’s doing great things and serves the Kingdom.” You’re going to hear comments like, “My manager cares for me and when I had something personal going on, they stop what they’re doing and came to the hospital, or prayed for me, or whatever.” You’re going to hear all kinds of personal anecdotes, things like [00:25:00] that, people talking about growth. That’s the kind of culture that we’re trying to build, it is hard when you have a larger team and they’re spread out, but, yeah, I think overall, and again, just going off data and it is anonymous, we have a very good story to tell. We do try to do better every day than we did the day before.
Brady: So, you have 600 employees, you’re in Knoxville, I imagine in like, the headquarters. So, everyone is like, obviously you acquire brands, [00:25:30] and not every brand is in Knoxville. So, I imagine a lot of them stay put. What does it look like when you survey and look at the 600 employees? You mentioned that they’re pretty much all within America, how does that look when it comes to the actual dispersion of all those employees?
Brad Hill: Yeah, so we have 10, depending on how you count, main offices, we have 10 or so. There’s a lot of remote folks who serve from various parts of, you know, [00:26:00] the country, or small work share locations, or even work from home. They are, as you said, they are all locations that we inherited because of brands that we acquired.
That’s a good side point as we … There was maybe one time ever that I can think of where we actually had an office shutdown. Actually, two, and those were because we had a nearby office. So, we [00:26:30] were able to just find some efficiency. “Hey, guys, we’re going to have you get together. Maybe some of you are going to have a commute five minutes longer, five minutes shorter, but we’re going to try to make this easy for everybody.” It’s, kind of, a no brainer, we don’t need two offices in one city. So, we’ve seen that happen a few times.
So, I personally, and our leadership team, we do spend a good amount of time traveling around just to get face time with everybody. As you can imagine we try to get pretty good at using Zoom and GoToMeeting, and all those tools to collaborate. [00:27:00] So, Knoxville is our main office, so to speak, headquarters, if you want to call it that. We have offices with 80 people, we have offices with two people. It’s just is all over the map.
Brady: Are all 600 within those 10 main locations, or do some work remotely, like from home?
Brad Hill: There are some remote ones.
Brad Hill: Yeah there’s … In fact, we got one in Canada.
Brad Hill: So, go Canada, right? Yep, but, yeah, so there’s some folks who work from home. We, [00:27:30] as you can imagine, we’re looking for good talent, and we’ve inherited some of those folks, we have hired folks as well that we feel like are sold out, passionate for churches. We tend to be pretty picky on that point, by the way, and are also really good at their craft. So, we’ll take them. We do like face time, I will say that. So, we’ve tried a lot of these models, and I can say, I’m going to sound old when I say this, but there’s no substitute for getting people in a room and [00:28:00] going shoulder to shoulder after a problem. So, we will travel around at times, but we’ll take somebody remote if that’s the only way we can get them.
Brady: So, you said that Ministry Brands officially started five years ago, when was the first acquisition, and what was it?
Brad Hill: Well, the way Ministry Brands started was an acquisition, actually. So, that was the day zero, if you want to call it that, of Ministry Brands. It was a new, empty company was created, with no employees, no revenue, nothing, [00:28:30] and then it acquired three companies. One of which was mine, that was a website company, there were two other online giving companies part of that as well. So, they formed a new legal entity, but other than the employees getting announcements about that, they woke up the next day and basically still went to work, actually with the same brand name. Answering the phone the same way, doing the same job they had before.
So, we, as I mentioned earlier, we don’t sell anything [00:29:00] as Ministry Brands today. It’s very important to us that people have relationships with their brands. So we started out from an acquisition, but we’ve kept the same thread all along, which is, we want the relationship between the customer and the brand to always stay there.
Brady: So, if the first acquisition was, like, the day the company became an official entity, five years ago. I think if I’m looking at all the brands, counting up correctly on your site, you’re right around 25 now, which would be 25 in five years, which would be more than one every [00:29:30] 90 days. I guess what I’m getting at is that, obviously, when you’re working at such a size you are, there are going to be people that are upset, hurt, or in disagreement with the direction or future of the company.
What would you say to someone that would say, “Hey, maybe acquiring a new company every, like, less than 90 days, is unwise. That’s at a pace that you’re just not realistically going to be able to keep in good graces with everybody. If you slowed down a bit, that [00:30:00] would allow for a little bit more of a smooth transition”?
Brad Hill: Yeah, that is a good point. So, yeah, your math is correct, although what actually is taking place timeline wise is a little different. We had a season, if you will, of pretty rapid, acquisition activity. There’s various reasons for that, but when we really, kind of, got speed, if you will, with respect to [00:30:30] identifying teams we wanted to bring on, or companies that we felt would be a good match for us. We got some very talented people, just with a business mindset, who think about this all day. They are very successful at getting people to a table to discuss this, and work pretty quickly.
So, what we did is, we thought about a season of acquisition, and actually this year, 2017, as we’re sitting here talking today, I think we’ve [00:31:00] had one acquisition this entire year. So that season of rapid acquisition, really did, kind of, take a little time and it was crazy, I will acknowledge. Now we have slowed down, as you said. So, as we talk, internally, we have a lot of all hands meetings and things. This year we see as an opportunity to optimize, to really take a breath even, and think about cleaning up systems and really going [00:31:30] hard after product and integration working in some of those things.
So, it feels really good now that we’re able to … We’re always open to the right opportunity, where maybe there’s another brand out there that we feel like would be a good fit. We’re not, like, stopping necessarily, but I think you’ve seen that pace come way, way down from where it once was.
Brady: Okay, I think we’ve done a pretty good job of covering, kind of, the origins of Ministry Brands, the past, and you mentioned earlier, at the top of this discussion, the [00:32:00] idea of consolidating different brands under one family so that you could have a more streamlined and smooth experience for the end user, for the churches. Where they’re not working with a ton of different brands, but really, they’re a ton of different brands under one family, so the resources are shared, maybe this allows for faster and bigger development because a bootstrap company has less cash flow. Whereas if a family of brands is sharing resources, now you’ve got more cash flow to do more for the end user, ideally.
I don’t know if this is something that happens [00:32:30] a lot in the world of secular tech, you know, in Silicon Valley. I can’t speak to that authoritatively, but I, kind of, wanted to ask about, like, what is the future, and end goal, look like for you? If you search Ministry Brands in Google, one of the first things on page one that you’ll see is a pair of reports from the Wall Street Journal, and they talk about how, look, there are big equity backed organizations, partners, I’d guess you’d say, venture partners, that are looking to, or in conversation [00:33:00] with, according to this report, Ministry Brands when it comes to acquisition.
In both of the reports it talks about acquisitions north of a billion dollars. So, it would make sense, from a big picture standpoint, separate from what the user experience is, “Hey, if we’re able to acquire a ton of brands, we can then sell to someone else for way more than we could if we sold each of these brands individually and added it up all at once, right? We’re more valuable as a group than we would be as a group of individuals.” Do you want to speak to that at all, about maybe, I don’t know if that report is accurate at all? Wall Street [00:33:30] Journal seems like a pretty reputable source, but is that part of the goal? Are you trying to like, get acquired, like one big cash out at the end?
Brad Hill: So, here’s … I’ll answer that a couple ways, Brady, and the way I’ve always run business and thought about business is that, pick any company, somebody will say, “What the main goal of your company?” My view is, if somebody says, “To make money”, like, “We’re looking to make money.” That’s the wrong answer. I don’t care if you’re talking a faith based, secular [00:34:00] company, any firm, making money, making profit is a rear view mirror of how you did. That’s how I view things.
So, if you are … You might be selling mattresses, or selling cars, or whatever, if you’re serving customers well, customers respond, they do business with you, they’re loyal. The business part, the money side, takes care of itself. Now those of us that work in technology know that technology [00:34:30] is this constant treadmill, just because you built a great product five years ago, and churches bought into that, you can’t just stop innovating. Right? You have to always be working on improvements, modifications, maintenance, security, retiring tech debt, and then, eventually innovating. It’s what we call the software development life cycle. That takes investment, and it’s very expensive.
So, I learned this, certainly running my own firm, that [00:35:00] it’s a very delicate balance and that if you’re trying to grow and really innovate at this scale now that Ministry Brands is doing, it does take capital. So, we look at the investment partners, for example, that you mentioned, which really weren’t part of the Ministry Brand story for the first couple of years. We got to a point where we said, “Man, there’s more we want to do. We have a big vision, we have big ideas, we feel like God has given us some really unique opportunities to do [00:35:30] this thing on a scale that no ones tried before”, but that’s going to require investment.
So, you know, we don’t like going into debt, we don’t like certain types of investment, but looking at private equity, which is the article you referenced talked about private equity, it’s a really interesting model, and because of the growth that we’ve been blessed to see as Ministry Brands, where are relatively attractive investment? Or, [00:36:00] somebody coming in?
So, the article you referenced from the Wall Street Journal, was from 2016, and really what happened there was we were getting a fairly steady, frequent drum beat of interest from different investment companies. That are saying, “Hey, we’ve heard about this, you guys are growing.” Some of them are believers, not all of them are, but they’re really interested in the business side of what we’re doing, and let’s just it on the table, call it what everybody thinks, investors are there for one reason, [00:36:30] right? They want a return on their investment.
So the trick is, how do you marry up the investor goals with our vision, which is to serve churches and ministries well? So, there’s a tension there, and a lot of people question or ask about it. I think that’s natural. I see it as a tension, but I see it as a healthy tension because what we’ve been able to do, is continue to grow at a really healthy rate, which allows us to reinvest and hire. A lot of the head count [00:37:00] we talked about earlier, we’ve grown, people are, and always will, be our most significant expense that we have.
It allows us to continue growing and serving those customers well in a sustainable way. We have brought a lot of companies into the fold that were either not profitable, or barely breaking even. That’s a very precarious place to put yourself and put your churches because they need to know that you’re going to be there to stand behind that product. So, we have the ability now to grow and invest. [00:37:30] We are making some very significant investments, as we sit here right now. In terms of new products and new innovations that we’re working on. We’re only able to do that because we’re both running a healthy business, and we have backing of investors.
The last thing I’ll share on this point, Brady, a lot of your folks probably are familiar with Dave Ramsey. He’s on the radio every day, the financial peace guy. It turns out that he runs a really tight shop. He’s written books about [00:38:00] how he manages his company, how he hires, how he thinks about staffing and everything else. I heard him talk once, I think it was catalyst. He was talking about … He’s like, “People ask me, how is it that you’re on secular radio stations and yet, you quote a Bible verse at the end of most of your shows, if not every show? How do they let you get away with that?” He said the answers really simple, “I make these guys lots of money, and as long as I’m helping them succeed, they [00:38:30] let me do what I’m doing.”
So, it was a very Dave Ramsey-esque, kind of, blunt answer, but I believe there’s some truth behind what he’s saying. We’ve really seen that experience as well. So, our private equity partners that we have behind Ministry Brands, there are … By the way, there are some amazing, Godly men on our board who have been put in there by the investors to help run the company, but they’re not all believers. Okay, I’m quite sure of that, but they are very, [00:39:00] not just tolerate, but very supportive and cheering us on, because, I believe, we are simultaneously achieving a really good purpose and giving something special to this customer base. We’re also generating a good return for them, which allows them to reinvest.
So, it’s a good, kind of, virtuous cycle. We feel really good about where we are and the direction. So, that’s the tension that’s there. The end game you asked about, the end game for us is to serve ministries, plain [00:39:30] and simple. There will be changes as the business grows, I’m quite sure of that. I don’t know what those changes are, I can’t predict when, but we, because of what happened last year and what you referenced in the article, we had so much interest we got to be very, very picky about who we partnered with. We’re very pleased with who we have behind us now.
Brady: Yeah, because when I think of like, software, in my elementary knowledge of how software in Silicon Valley works, like, a lot of the time you’ll work really hard as [00:40:00] a start-up to build this great product, and then you sell it off and you get to have your glorious, miraculous exit. Where you, as the founder, cash in, you know, with your tens of millions, ideally, that you get. So, what you’re saying is, like, the end goal isn’t to build this all up, get the awesome cash out, and be like, “Well, good luck all 25 plus brands that we have because Brad Hill’s riding off into the sunset in his new luxury car of choice.”
Brad Hill: That’s right. No, I can assure you Brady, I do not drive a luxury car, and I’ve been here [00:40:30] a while because I’m really passionate about what we do. None of us can predict, you know, what God’s got for us down the road, but I would say that you’ve got a team here at Ministry Brands that wakes up every day very excited, and that’s leadership on down, very excited about what we’re doing and who we’re serving.
So, yeah, end game for us, I think is to keep on serving churches well. I wanted to also just, kind of, add one plug, this feels like a [00:41:00] good time to do that. For really something that I’m personally very excited about, that our company is able to do because of that growth, and by the way because of the investment that we have, we are doing some really cool giving and missions type of work. Something that’s true about me, I’m very, very passionate in businesses and ministry getting together. I think there’s a lot of Christian business owners that haven’t figured out how to live [00:41:30] out their faith at work, or how they can really have their personal faith, kind of, invade everything they do at their company.
We’ve been really fortunate and blessed here at Ministry Brands to be able to be out loud about who we are and who we’re serving. We make some bold statements about our faith, so we’ve been able to continually, every year, grow in how we’re living that out. We’ve actually, if folks are on our website, there’s a blog. We [00:42:00] never try to over sell this because I never, ever want it to be from a place of promotion or whatever else, but I bring it up just because you mentioned the end game and what we’re about.
Quite honestly, when I look back on this season one day, one of the things I’ll be most proud of in addition to helping this company grow and serve churches, is that we’ve generated an engine here that is giving back to churches and ministries both domestically and internationally, [00:42:30] all for the glory of God. So, that’s a big deal to me and I have a lot of friends that run companies that are trying to pull something off like that. I’m really excited that we’ve been able to that here at Ministry Brands.
Brady: You know, it’s an interesting discussion because for the longest time, as you’ve said, we’ve had this space of church tech that’s been mom-and-pop shop basically. Started by someone who is bootstrapping, and bootstrapping just means like, doing it from scratch, using the profits of the company, reinvest, [00:43:00] and you’re not taking outside whether it’s public or private equity to fund the venture. This is, kind of, the first thing that I’ve seen where we’ve had a big influx of cash that is going to then be, ideally, put into brands that are serving churches.
It’s a tough tension, right, because like, ideally you’d have a world where your product is exceptionally profitable and everyone who works together, works in harmony. Everyone gets to, at the same time, serve their churches [00:43:30] 100% as the end user, right? But something’s got to give here where either you take in a ton of money, so that you can build something awesome for churches, but have to answer to the money in some way that’s being injected into the company. Or, you serve your churches 100%, knowing that you won’t have as much money to invest, and thus maybe not able to serve them as well.
This is the conundrum, right? There’s this sliding timeline of like, where you can be the best. On the one side you can be really … You [00:44:00] can serve your churches very poorly because you have no money and have a crappy product. As much as you care, it doesn’t matter what your intentions are because you can’t build anything worthwhile because there’s no cash. On the other side, you could take a ton of money from outside sources, and then just maximize for profit 100% and neglect your churches, and don’t care at all.
Ideally there’s something in the middle that would be the perfect management of the tension, but I also can understand how it’s tough to do both. Do you want to talk, as we close out this, just, kind of, like, how you’re trying to manage that tension, [00:44:30] serve churches, but also return a good profit? Do those ever come into conflict, or are the working in perfect harmony?
Brad Hill: Well, yeah, that’s a good sum up. Yeah, you know, there’s conflict there. Software’s hard, it’s a difficult business because, you know, I think if you’re lucky you build a great product and you might get 10 to 12 years of really useful value out of that. You know, hey, if anybody’s keeping score like it’s 2017 [00:45:00] right now, 10 years ago what was happening? Like, the iPhone came out.
Brady: Facebook went public ten years ago in 2007.
Brad Hill: I mean there’s sea changes that happen in that amount of time.
Brady: Public, as in you could register, not public … We’ve been talking a lot about going public as a customer, that’s a different thing.
Brad Hill: Not IPO, but-
Brady: Not IPO, public as in, any one can.
Brad Hill: [crosstalk 00:45:18] to Facebook, yes.
Brady: Anyone can register, not just if you are at a college. Anyway sorry Brad, not to interrupt, go ahead.
Brad Hill: I’m tracking, I saw the movie, yeah absolutely. No, great point. Yeah, so there is tension, [00:45:30] and where I think we come down on this is back to what I shared early on in our conversation that when I talk to pastors and churches, they’re … By the way, we have a … Even when our executive leadership team meets, we will always carve out at least a half day to bring a panel of church staff and communicators and pastors together. Every time, we hear the same main pain point, you know, “What’s the number one thing you’re dealing with?” It’s either [00:46:00] the tools don’t work well, or they don’t work well together. “We’re dealing with fragmentation, etc.”
So, when we come in, if I can have a church that was just, maybe, using us for a website and now they find value in getting a website, plus giving, plus church management, plus mobile app, plus whatever. That helps really streamline things for them. It is revenue for our company, so that’s growth for us. [00:46:30] By the way, because we provide them more services with the same team, we can be more efficient, which means we can actually lower prices. We’ve got tons of examples where we come in with a church and look at what they’re spending on technology, versus what we could do for them, and it’s, kind of, a win-win. I know that sounds very utopian, but it really plays itself out when you start to realize some of these economies.
So, the more we can do that, you know, the more we can come into a church and help them more universally, [00:47:00] with not just software, but coaching on how to use it, that is a win. I get to go back to, you know, whoever investor, and give them a really good story on growth. I get to go to a church and give them some good news on savings, and pricing, and better value. I have a team here that’s no energized because they’re building great stuff and serving more churches.
We have now, about 55,000 churches that we are [00:47:30] working with in some form. If you are the kind of person that comes in and works for a tech company because you love churches, I’m just going to say, it most cases it’s a lot more exciting to think that you’re doing that for tens of thousands of churches, than maybe a couple hundred, or a couple thousand. So, the scale we’re doing something on is very exciting. I tell my product teams a lot, you know, “Hey, the decision we’re making right now, will affect, in a large part the way church is done.” At least in our client base.
[00:48:00] That’s exciting, but it’s also very, very sobering. In other words, this is bigger than just … This is bigger than something human, this is bigger than a company. This is a big sea church thing, and we want to take that very seriously and make sure we get it right. So, that’s, at the end of the day, if there’s ever that tension and we have to come down on one side, it’s always, always going to be what’s right for the customer, what’s right for the church?
Brady: Final thing that I wanted to ask you Brad, there are … An article … [00:48:30] There are a lot of different Facebook groups, I’ll say, church Facebook groups, that communicators and people are a part of. There are a ton of people that I really respect, that responded to an article that came out last year that someone posted.
It was basically around this exact same time, end of year 2016, and I’m just looking through the thread of Facebook comments, and a lot of people that I respect just saying things like, “You know, whoever has the cash to buy it for this much, they’re not going to build something new, it’s just a holdings and profit game.” Or, “Look, I hope this ends well, but my gut says it’s not going to.” Or, you know, “This feels like, x, y, and z. [00:49:00] Last time this happened it didn’t end well.”
I just want to give you like, what would you say to the people that are saying, “I hear what you’re saying Brad, but I just don’t see this ending well, and I just don’t like this approach. It looks, the optics are poor.” Like, what would you say, kind of, as a sign off to those people?
Brad Hill: Sure, well, I can’t promise that I get to every one of them, but my style Brady on this is if I … You know, I’ve seen Tweets, I’ve seen posts along these lines. I try real hard to reach out personally to people, just because I feel like, you know, one-on-one conversations are always the right way to [00:49:30] go.
So, I’ll tell you what I have said, because I’ve talked to some of these folks who have quote/unquote, “just have some questions, or just wondering”, they, kind of, like to stir, maybe, some debate in the public square. Number one response is time is our biggest ally here. I realize your concerns and I realize where you’re basing those on. I would ask you to give us time. I would also ask you remember that we have real human beings, and we’ve talked about our number of employees today. These are real people [00:50:00] who love churches. These are pastors, deacons, lay-leaders, worship leaders, who go home and they use our products at their churches. So, they love what we’re doing and they’re very passionate.
I would also say that we have built stuff. We don’t just buy stuff. We have done a lot of very meaningful development. I’ll give you one quick example, so Fellowship One, that we talked about earlier, is a product that was, in its day, meaning when it was founded, was really [00:50:30] one of the pioneers for Sass products to serve a church, especially church management, church database. They were also an innovator on child check in. They had some really, really important advancements that they brought to the market, that we all, kind of, now take for granted.
Over the course of their, you know, 10-12 year history, then getting into when they were acquired by Active Network, the product development cycle, really slowed down. That generated an increasingly frustrated group [00:51:00] of churches who were looking at Fellowship One and saying, “It doesn’t feel like you guys are really doing a whole lot on this product. So, when we came in and brought Fellowship One into Ministry Brands, we saw that as an opportunity to take what I still believe is a great brand. I think it has an amazing value to the church market. To, kind of, get it back on track.
You know, one of the folks, Scott at F1, I remember the day we announced the acquisition, he said, “I feel like we’re coming home.” [00:51:30] SO, what we’ve done in the past year is looked at Fellowship One, and where are all the areas where we can begin to, kind of, get this back on track. We looked at the number one requested feature that churches had had for years on Fellowship One, was better reporting. Churches really want to understand how they’re doing. They don’t just want to count things, like attendance and giving. I think they want to understand, “Am I making disciples, am I growing leaders? Am I attracting families?” They want metrics.
So, what Ministry Brands [00:52:00] did is we made a sizeable investment near the latter part of 2016, and we brought a brand new feature to Fellowship One, we call it Fellowship One Insights. The purpose of that was to address a direct customer feedback point, and we were able to finally deliver, what I think is, an amazing tool to report on all the aspects of your church. That’s something that, you know, the F1 company, the F1 prior owner, had not been able to deliver on for [00:52:30] close to 10 years.
So, that was something we looked at, and said, “Let’s build that because those churches legitimately need it.” We think that’s just the right thing to do. So, that was an additional investment we made. Yes, it’s good for business, but more importantly there’s a reason behind it. Now, by the way, we’re looking at ways we can bring similar value to churches that may not be on F1.
So, that’s our mentality. We could do a whole other conversation on product road map, but we’re very much about building, not just buying. I [00:53:00] think folks who were on that Facebook group, folks listening to you and I talk, months from now, six months, 12 months from now, they’re going to continue seeing a cadence of new innovation coming out of Ministry Brands. Which will ultimately just help churches, that’s what we want.
Brady: Awesome. I think that’s a perfect to leave off Brad. Is there anything that you, kind of, want to let us know about, where we can check out more things about Ministry Brands? Or, great things that you have coming up, that you want to leave with us?
Brad Hill: Well, [00:53:30] I guess I would say, based on the time of year this is, we’re heading into fall, we think a lot right now, this time of year, about generosity. I think that’s a big theme for churches, and maybe, the second thing I hear the most from churches other than fragmentation of technology, is, “How can I get more people engaged in my congregation? Whether it’s serving, or giving?”
So, I would encourage folks, we think every church should be online, using digital giving. We just think that’s [00:54:00] a no brainer, we don’t care if you use it from us. We would love that, but I would encourage everybody here to check out resources for online giving. The place I would direct you to, two actually, if you would allow. EasyTithe.com is one of the brands you and I talked about earlier today. They do a fantastic job helping churches really get the most out of their stewardship programs.
Another company that’s part of the Ministry Brands that has nothing to do with software, [00:54:30] is called the Rocket Company. The Rocket Company has some fantastic tools on coaching to help you really get the most out of whatever tools you’re using. Actually, the thing I hear the most is churches may have online giving, and they have no idea how to talk about it. They don’t know how to mention it from the pulpit, what to put in the bulletin, etc.
So, if you go to the Rocket Company’s website, RocketCompany.com, you’re going to see some really good resources. There’s some free stuff there. There’s also some paid coaching you can [00:55:00] go through. These are preeminent voices in this space who have figured out the right model, and if you’re going into this year trying to figure out, “How can I make this in a November/December period, the best it can be?” We’d love to have you check out some of those resources and tools, whether you go with a Ministry Brands product or not, I want every church to blow out their budget goals for the end of the year. That would be a great thing.
Brady: Awesome. All of the links that we talked about, will be linked in the show notes at ProChurchTools.com. [00:55:30] A big thank you to Brad. Thanks for coming on the show and having this candid conversation. I hope that a lot of people will be able to listen to it, and it can end whatever speculation. I think, you know, we’ve heard one side of the story pretty well. When I was excited for, when you reached out about the idea of a podcast, was that, we want to hear both sides of the story. Like, there are two sides to the story, it doesn’t mean that this necessarily leads to any distinct conclusions. A lot of it has to do with, like, “Hey, wait and see.” We want to hear both to …
Gossiping and [00:56:00] the speculation, as much as can be avoided, should be, I think. Thanks for coming on, and sharing all of that, and just, it’s been a blast, so thank you.
Brad Hill: Thank Brady. I appreciate you creating this forum. Great show.
Brady: Alrighty, there you have it, my interview with the President of Ministry Brands, Brad Hill. Just to do a quick recap, we talked about the origins of Ministry Brands, the acquisition strategy that Ministry Brands is using. We got Brad to respond to the negative perception that Ministry Brands has had, up until this point, within the church space, and also respond to the poor reviews [00:56:30] on Glassdoor.
We talked about how Ministry Brands manages their 600 plus employees in their 10 different locations. We talk about the acquisition strategy from, you know, that first acquisition, all the way to 25 brands in five years. You know, that’s a very rapid pace. We talked about the Wall Street Journal report of, you know, the private equity that was put in, more than a billion dollars. Then leading up to that, how do you then manage the tension between maximizing profits for investors, while still serving churches well?
So, I just do want to give a shout out to Brad for coming on the show and answering [00:57:00] all the questions that I asked. He was very forthright and transparent. You know, it’s up to you to make your decision on what you think Ministry Brands is up to. Really, this big difficulty of managing the tension, of pleasing investors and serving your customers. It is the lifelong tension of businesses that have equity, but it also means that they have more money, which means they can probably, or at least, ideally, let’s say, serve their customers in a way that bootstrapped companies cannot.
Again, hypothetically, ideally. So, with all that being said [00:57:30] again, thank you to Brad for coming on the show. It is now time for our review of the week, and this review comes from the Apple podcast paradise, the store. If you want to call it the Apple podcast store because everything is free, the Apple podcast platform, let’s say.
This one comes from Evan Shows from the USA, five stars. “I’ve been following Brady on his blog, and now podcast, for several years. He’s one of the most innovative and energetic voices in church communications right now. He always has exciting guests and provocative topics in the podcast. I’m constantly learning and improving [00:58:00] based on what he has to say, and would recommend him to anyone trying to reach a new generation for Jesus.”
Well, thank you Evan Shows for that podcast review, inside of the Apple podcast platform. It means the world to me. We publish three new sessions of the Pro Church podcast every single week, so if you’re new, we publish a new interview session, just like this one, every Tuesday. A new coaching session, where I coach and consult with a church in real time for about an hour, every single Thursday, and then a new episode of the Ask Brady Show, every single Saturday, where I’m answering four questions from the great people [00:58:30] of Pro Church nation, just like you.
So, thanks so much for tuning in. It would mean the world to me, the best thing you can do to help this show, is to subscribe. Go to ProChurchpodcast.com, hit subscribe and you’ll get a new session every single time it’s published, sent directly to your mobile device in your podcast listening app of choice. Again, thank you Pro Church nation, so much. We love you. Go ahead to ProChurchpodcast.com, hit subscribe, and we’ll talk real soon.