FutureForesight was formed with the explicit intention of taking Mckinsey-calibre skills to smaller cap companies. Such companies cannot justify premium consulting fee levels of R50k/day, and thus our model is designed around an at-risk philosophy; here we believe that if we are successful, our client will easily be able to justify the pre-agreed payment terms.

We offer 3 different fee models:

Fees

What: Here our fee levels work out considerably lower than the blue-chip consulting firms, provided we have a view that the work will lead to a future participation model of some description.

When: There are occasions where simple fees are necessary. Some companies (particularly parastatals) cannot open themselves to variable fee models, and others require that we are completely objective about the project outcome.

Fees at risk

What: With this model we agree a fee schedule to be paid out upon specific deliverables. Typically the fee levels will be multiples of the non-risk fees basis for obvious reasons. With this model we typically require a 'hygiene fee' to ensure we are not being abused (ie employed on no-hope projects to make a manger look like they are at least trying).

When: This model is particularly attractive to clients that are unable to justify taking the risk of consulting fees, but where they know that success will result in the fees being readily available (eg building a new business unit).

Variations:

• Lump-sum payment upon a specific deliverable, perhaps staged
• Share of savings (eg improve process, procurement, revenues, costs)
• Share of potential value secured (eg turn around a non-viable facility)

Equity

What: Here we are compensated through a mechanism that is directly linked to the success of the business. Where we are able to influence the final exit valuation, we would want pure equity to allow us to share in the exit.

When: Equity is usually the most attractive option to our clients. This arrangement ensures perfect alignment of incentives; if the client succeeds so do we, and if they succeed more so then so do we. Both parties are incentivised to acknowledge if things are not working out and to call it a day.
The beauty of equity is that it's easy to embrace a value; if you believe that having FutureForesight capacity on board and around the table will increase your business' value (NPV, sale, whatever) by 10%, then giving us 10% is a safe wash and comes along with the probabiliyy of upside, and significantly reduced risk.

Variations:

• Share of revenue for a specific period and scope
• Share of profit for a specific period and scope
• Equity as pref shares converted into normal shares upon a deliverable
• Funding fees linked to fund raising and exit values
• Simple equity up front