The Fed has cut rates by 50 basis points. While that might not seem like big news for this update, there is an important correlation to our business that I will discuss below.
Augment at a Glance
Since my last update, we have signed 2 new clients and two consultant engagements came to an end (one with the successful implementation of a credit risk model). Today, the platform of available consultants stands at 77.
New and Prospective Clients
Shortly after my last update in late July, we signed a regional bank to provide compliance-related expertise. And, as luck would have it, we just extended our team member after her really productive work during the first engagement period. It is always nice to see our clients confirm the value we provide through extensions!
We also signed a publicly traded InsurTech marketplace in August. We will be supporting the client with marketing analytics and competitive intelligence. In fact, the client emailed me as I am writing this message to inquire about other part-time resources with strong search engine optimization (SEO) expertise.
Finally, in early September, we received an extension for one of our project managers as our FinTech client wraps up implementation of a new loan origination system.
We are hoping to finalize an engagement with an existing client to provide data analytics support to them through at least the end of the year. We should know if that project is moving forward this week. And I am still waiting for the thumbs up to start deploying some team members to support another insurance company to build a well-managed business review process for the entire company.
Why the Pipeline Is Smaller Than It Has Been All Year
As I vaguely alluded to at the beginning, our active pipeline is smaller than it has been at any point in the year. I attribute this to several things: 1.) August is the month that everyone goes on vacation; 2.) we are entering the final quarter of the year when many clients are focused on 2025 budgets; and 3.) the economy.
I believe the reason the Fed cut by 50 basis points was a combination of softer-than-expected inflation data as well as employment. It is not common for them to move more than 25 basis points at a time. And we have two clients in the last several months where our engagements have ended who explicitly pointed to necessary belt-tightening. The good news is that our deep experience in risk, compliance, and collections/recoveries helps to dampen the impact on Augment and, in some cases, can help us operate in a counter-cyclical manner. But the reality is that we need to build our pipeline and that will be my focus over the next several weeks.
A Story I’m Proud Of
A story that I am really proud of is related to an engagement involving one of our recruiters, Charles. In 3 months, Charles helped his client hire through their entire recruiting pipeline. What started as an act of desperation from the client almost ended when the client called to apologize that Charles had worked himself out of a job. Fortunately, the client opened two more roles the next week and was super enthusiastic about Charles being able to re-engage with them.
What Clients Tell Us
Our Augment client quote from this month isn’t quite as inspiring as last time but I think it is equally valuable:
“Ron was super attentive, provided solid analytics, and really understood the business.”
To me, every element of this quote is important: 1.) “attentive” — when a client feels like they are your highest priority, you are starting out on the right foot; 2.) “solid” — I feel like this is table stakes for Augment but it is good to hear; and 3.) “understood the business” — I hear time and again that a client can find technical resources but they can’t find people with an understanding and interest in the business problem the client needs to solve. This is our differentiator!
Finally, I would like to shout out a thank you to Anirban who presented to a major credit bureau in August on the topic of Fraud. We received glowing reviews for Anirban’s insights and expertise. I’ve decided to hold off on additional presentations for the moment while our priority turns entirely to business development.
