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Trust as a Foundation – John Deane Reflects on Leading The Alta Group

Date: Jan 06, 2021 @ 07:00 AM

In November 2020, The Alta Group announced the retirement of John Deane, CEO, Chairman and a Co-founder of The Alta Group at the end of 2020. While Deane retired from daily management of the company at the end of 2020, he will continue to serve on Alta’s Board of Directors. A trailblazer in the equipment finance industry, Deane co-founded this unique consultancy firm 27 years ago with co-founders Norm Chapman, Bill Montgomery, and the late John Giddens, and since inception The Alta Group has completed thousands of client engagements and visits in more than 50 countries.

Taking the helm for the company are Valerie Gerard and James Jackson, Jr., who have been appointed Co-CEOs, and Thomas Wajnert will serve as Chairman of the international consultancy dedicated to the equipment finance industry.

Photo of John C. Deane - Board Member - The Alta Group, LLC

Prior to founding The Alta Group, Deane served as a Principal in the firm of Amembal, Deane & Associates. He also served as CEO of both Great Western Leasing and BancOne Leasing and earlier in his career as a Chief Financial Officer and President of several major financial corporations. Deane is also a former Chairman of the Equipment Leasing and Finance Association (ELFA).

In the following interview, Deane reflects on the early days of the company, how the industry and The Alta Group have evolved during his tenure and provides his insights into what will drive our industry in the future. Additionally, Valerie Gerard and Jim Jackson reflect on Deane’s impact on the equipment finance industry and provide a look into how they will serve this “one of a kind” consultancy that has impacted so many professionals over the past 27 years.
 
We started by asking John Deane to tell us a bit about the early days of The Alta Group and what drove him and his co-founders to create the company originally.

“In the early 1990s, there weren’t any companies offering true, strategic and in some cases, operational consulting services for the equipment finance industry,” said Deane. “That's why we decided to start the company. Our very first client was the Boeing Company, which found us because of Sudir Amembal’s training activity with Boeing over the years. We learned very shortly thereafter that we had been bidding against another group of consultants – Norm Chapman and John Giddens. We all knew each other from our ELFA days, and I'd done some business with Norm Chapman’s bank leasing company, so we decided to get together to discuss the possibility of working together rather than competing against each other. At first it was a very loose arrangement, and in 1992 we agreed to work together under the name “The Alta Group.”

From its inception, The Alta Group’s strategy has been to combine the talents of professionals across multiple areas of expertise. Today, The Alta Group offers multiple services globally utilizing the various skills of 72 professionals in the practice. We were curious if Deane has been surprised by the growth in any specific areas of the practice over the years.  

“Yes, one of our newest practices which is Business Quality Assistance led by Paul Bent, has only been in existence for close to two years, and it has really taken off; and the speed of its growth has surprised us,” said Deane. “The Alta Group provides best in class, deep due diligence services. We like to distinguish our services from what I call ‘box checking due diligence’ because due diligence services offered by accounting firms will typically provide an accounting due diligence. Accounting firms often do not understand the equipment finance industry – the difference between small ticket and middle-market financing, or tax-based and non-tax-based financing, or residual-based or non-residual based financing. There really is no other firm out there that can provide the depth and breadth of capacity that we can offer. One of our wise sage pearls of wisdom sayings internally is, ‘our services are not sold, our services are purchased.’ Over 50% of our annual activity comes from either existing or past clients.”

Stand-out Moments

The Alta Group, like the equipment finance industry, has evolved over the past 27 years. We wondered if there were any ‘stand-out’ moments for Deane since starting the company. According to Deane, the creation of the Dell captive finance business, and working with IBM Credit were gamechangers for the company.

“We were very much involved with Dell in the creation of their captive finance business back in the mid-90s. Originally, Dell’s finance program was outsourced to a predecessor of AT&T and CIT. That was certainly a real gamechanger for us,” said Deane.  “The reason this project stands out for me is that the champion of the project was Michael Dell. We got to work with a major company on a major project and this really brought us into a different space. Along the same timeframe, we had been working with IBM Credit for quite some time. At that time IBM Credit was essentially a large ticket enterprise finance business. They didn't have a small ticket operation and they came to us to help them start the small ticket operation. They of course were and are a very capable company with lots of talent, but that talent didn't include small ticket finance experience.”

The Perfect Storm

In 2001, the Equipment Leasing and Finance Foundation commissioned The Alta Group to complete a study to determine why equipment leasing and finance companies succeed and fail. This groundbreaking study titled The Perfect Storm was a post-mortem analysis of the industry, designed to be used as a learning tool. Noteworthy is that this study has been distributed over one million times since being released.

We asked Deane if this study was a ‘stand-out moment’ for The Alta Group. “Yes, it certainly was,” said Deane. “After the tech bubble burst, the Foundation came to us to complete a study that would analyze what happened to the industry during those years as many leasing companies had run into significant trouble, with several of them going out of business. I remember going to the ELFA convention in Florida that year to present the report. Over 300 people came to that session, and it was standing room only. I think that study took us into a different space because to my knowledge, no one had ever completed a study of this magnitude about the equipment finance industry.”

Challenges Ahead

We asked Deane to tell us what he views as the biggest potential challenges facing the equipment finance industry. He pointed to two challenges – asset quality and delivery systems.

“I think there are two challenges the equipment finance industry is facing already. First is related to asset quality – meaning delinquencies and charge offs. The fungibility of our portfolios has been a critical element of the success of our industry over the years. Our ability to leverage equity and achieve appropriate return on investment is dependent upon having portfolios that have reasonably predictable and sound quality standards. One of the reasons that our industry blew through the tech bubble with little difficulty, and then blew through the great recession of 2007 and 2008 is because as an industry, we've done a great job of managing portfolio and asset quality. But the pandemic has introduced a new element into the industry where it may not matter how good the management was depending on how significant the problem becomes. There could be serious ramifications if the asset quality becomes problematic.”

Deane continued saying, “I think the second area is going to be in what I'll loosely refer to as delivery systems. Meaning, how and when services provided by our industry will be provided to our customers in the marketplace. A good reference point is Bill Verhelle’s company, Innovation Finance, which is developing an entirely new business model. If this new approach is successful, there will be some significant competitive catching up to do from other parties. This new ‘digital’ approach is going to drive some fundamental changes in how we provide related financial services.”

Generational Recharge

Looking ahead to the new leadership of The Alta Group, we asked Deane to explain what makes Valerie Gerard and Jim Jackson the best choices to be Co-CEOs of The Alta Group.

“We were looking for a generational recharge that could lead our company going forward. Both Valerie and Jim have strong commitments to the industry. Choosing them for these positions was targeted, planned, and they earned it. They earned it with our clients, which is where it's most important.  Valerie and Jim are perfect examples of our commitment to our clients,” said Deane.

We also took a moment to ask Valerie Gerard and Jim Jackson how they would you describe John Deane’s leadership and accomplishments as a founder and CEO of The Alta Group over the past 27 years.

Gerard responded, “I have long referred to John as the ‘dean’ of the equipment leasing and finance industry given his command of all-things leasing and equipment finance. His early years as an operator in the industry gave him tremendous insight on what it takes to successfully build a business from the ground up, weather various economic scenarios and respond to competitive threats both inside and outside of the industry. Becoming a consultant suited John well given his intellectually curious nature, his ability to ask the tough questions and then translate lessons from the past into wise, actionable guidance for clients. In fact, many industry CEOs, past and present, actively sought out his prescient insights as their companies have faced strategic and operational challenges. In that way, John was always Alta’s best marketing asset. Internally, John created a culture rooted in the importance of strong listening skills, to always do what is in the client’s best interest even if it means delivering a difficult message and above all else, to provide world-class advice to clients. John Deane is a one-of-a-kind visionary, and the industry is much stronger today for his wisdom and contributions such as The Perfect Storm paper that enabled many firms to see past the challenges at that time.”

Jackson offered, “John is undeniably a trusted thought leader for the equipment leasing and finance industry and his guidance is sought out from leaders of bank-owned finance companies to brokers and captives to independents. One only needs to speak with John for a few moments and you will quickly sense his commitment and passion for our industry. I attribute much of his success to a combination of his curious nature and keen listening skills which allow John to quickly assess a client’s core issue and once determined, provide sage advice and guidance based on his decades of industry knowledge and experience. For years, John has been at the forefront of hearing from industry leaders a diverse list of issues and concerns plaguing our industry and has taken a lead role to resolve these problems. We are fortunate that he will remain on our board."

We also asked Gerard and Jackson to share what they are looking forward to the most as they take on the roles of Co-CEOs.

“We believe our core value proposition is to provide premium services to our clients in an efficient and cost-effective manner on a global basis,” said Jackson. “The ability to deliver on this strategy requires that we continue to attract and retain top industry talent who have had successful careers in diverse settings. The industry has changed significantly since John founded the company in 1992 and we anticipate it will continue to evolve as technology, customer experience models, artificial intelligence, ESG issues, and the desire for usage-model solutions become more dominant. Securing and retaining this talent either in the form of direct hires or through quality strategic alliances, will be critical to our future success."
 
“Jim and I are deeply committed to Alta remaining the preeminent provider of equipment leasing and finance consulting advice to our clients around the globe,” said Gerard. “While we will continue to provide the insightful analysis and solutions that made The Alta Group an industry thought leader, you can expect us to offer a new and innovative customer experience that uses new technologies in delivering our value-added services. You can expect our solutions to embrace challenges created by emerging usage-based business models, by newer technologies like blockchain and artificial intelligence, and by budding issues such as sustainability and cybersecurity. You can expect us to retain a deep consultant base while adding relevant talent that reflects a rapidly changing industry. You can expect to see us partner with service providers that bring innovative solutions, often from outside the industry, to our clients. We are fortunate to work with a group of consultants who are experts in their fields and are excited to engage with them as we usher in our future and help our clients adapt to the industry’s evolutionary changes.”

In closing, Deane shared what has been most rewarding for him personally since forming The Alta Group 27 years ago.

“I think clearly the most rewarding aspect of what we've all done together has been two things. One is we've always tried to do the right thing. I know that sounds trite, but it isn't trite. We look at engagements or engagement opportunities and we always talk about things like: Is this something we can do? Do we have a conflict? Is there a perception of a conflict? Is this something where we can really add value to the clients? That's always been in every single engagement we've ever talked about. Secondly, The Alta Group has a remarkable reputation for honesty, trustworthiness, and for looking out for the good will of the industry as a whole. I would say that is a good synopsis of 27 years of doing this. Our clients trust us because we've spent 27 years making sure they can.”



Founder / Publisher | Equipment Finance Advisor
Michael Toglia is the Founder, Publisher and CEO of Equipment Finance Advisor.

Michael Toglia's experience in commercial finance spans over 30 years having held various roles in senior management, business origination, capital markets and commercial credit underwriting. Prior to entering the publishing industry, Toglia served as Vice President of Capital Markets and as the National Sales Manager for both the Equipment Finance and Asset-Based Lending Divisions of Textron Financial Corporation. He also held various roles with General Electric Capital and CIT Group.

Toglia currently serves as Marketing Chair for the TMA Philadlephia/Wilmington Chapter. Toglia served as the Executive Director/CEO of the National Equipment Finance Association from 2018-2020 and has been an active member of the Equipment Leasing and Finance Association having served two terms as a member of the Service Providers Business Council Steering Committee.

Toglia holds a Bachelor’s Degree in Accounting and an M.B.A. in Finance.

Contact Michael Toglia at 484.380.3184 or mtoglia@equipmentfa.com.


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