‘Being an entrepreneur is like being a parent’: Humanforce founder Bruce Mackenzie on when it’s time to exit

Remember the good old dotcom days? Just like other tech inspired booms, there were movers and shakers who saw an opportunity to create platforms that 20 years later still make an impact.

Bruce Mackenzie, the founder of global workforce management technology company Humanforce, was riding the wave of this boom at the time, bootstrapping two ventures.

One such venture was Humanforce itself, which recently sold to US private equity funds for $60 million.

After 20 years at the helm, Mackenzie, who set up the business in 2002, is leaving the building, ready to take on new ventures.

He shares with SmartCompany Plus how the time was right to find a new challenge, and how a founder knows when it is the right time to move on.

Changing tides

Mackenzie’s exit comes three years after new majority stakeholder Accel-KKR first invested in Humanforce as part of a Series A capital injection.

As part of the current deal, Mackenzie sold his remaining stake, stepping back from the day-to-day operations and hiring an external chief executive, Clayton Pyne.

For an entrepreneur who has been on the cutting edge of developing tech products over the past three decades, walking away from something Mackenzie built from scratch was not as hard as you’d think.

“It is time to open new doors and opportunities. I set up the business at a time when human workforce management techniques still used pad and pencil or Excel at best, while staff had to physically clock on and off and workers were paid in cash,” Mackenzie said.

“The business is in such great shape with a top team, and the Humanforce SAAS solution is being used across the globe and helps create better workplace outcomes for millions of people.

“With the gig economy here to stay and Humanforce is ‘front and centre’ of that movement.”

Bootstrapping a startup

Mackenzie has been neck deep in the tech world since he left university in the 80s.

His first business, PEG Technology, rode the wave of the dotcom bubble until breaking on the shore during the bust. In the back of his 17 years at the helm of PEG Technology, he took those lessons to start Humanforce.

“My first enterprise came at the start of IBM compatible computers, and out of all the other business opportunities, it made the most sense,” Mackenzie said.

“Back in 1997, there were only two venture capital deals done in Australia, so it was almost unheard of in the era when the information superhighway had just started.”

“Tech post-dotcom crash was hard, and by focusing on the biggest pain point of the retail and hospitality industries, which was their workforce, Humanforce was a solid solution.

“But it was a different world to today, where you didn’t need a lot of capital to get started. Bootstrapping made sense, because there were so many working in new tech to learn and grow from. But it wasn’t until 2007 when I floated the business to see what would happen.”

Humanforce was 17 years old before it took on its first external funding, bringing in $22 million in a founding round led by its new owner, Accel-KKR.

“Bootstrapping meant we had to make sure Humanforce was profitable from the word go, because there was no capital funding when we started in the early 2000s,” Mackenzie said.

“We were able to build by keeping the business lean, and this held us in good stead when it came time to raise capital.”

Business startup advice

Mackenzie concedes it was easier to start a business now than in the 90s and 00s.

“There is so much funding for business startups, but I never doubt it will be easy,” he said.

“I have never heard anyone who started a business say it was the easiest thing they’ve done. Most entrepreneurs lay awake at night worrying about all the things you must do and make happen.

“If you are not lying awake at night, you either have lots of money in the bank or haven’t invested enough.

“It would be brave to hang their shingle out now. I suggest people wait a quarter to see what happens.”

If you are thinking of getting your venture off the ground, do your research.

Mackenzie suggests delving into the sector to ensure your idea is viable, especially if launching a tech startup.

“Do the basic stuff and get support. There is so much support for startups with incubators, hubs and mentoring. It is a good time to go into tech as long as you do your homework,” Mackenzie says.

“There is never a bad time, but there is a worse time if the market has no need for what you are doing. No one wants to be in a race to the bottom.”

Knowing when it is time to move on

Mackenzie openly embraces his entrepreneur moniker and believes that an entrepreneur’s job is to know when to exit. He says his job was to build Humanforce to the point where it needed more than him to grow.

“I built the business from an idea to a place where it needed a great management team. That is not where my skill set lies,” Mckenzie said.

“Capital was secured so we could bring on a skilled CEO in 2017 so I could return to what I am good at, which is creating things within the business. Appointing Clayton Pyne allowed me to do that.

“As a founder, you know it is the right time to leave when you start getting in the way of the management team. When professionals run your business, your job as an entrepreneur is to start and scale up. There are not many entrepreneurs who can move into management, because our brains do not work that way.

“Think of being an entrepreneur like being a parent.

“Your job is to raise the child so they can spread their wings and grow. When you have done that, your job is to find the next thing you want to work on; the next solution to problems that need your insights and ideas.”