Karen A. Kowgios is an emeritus partner at Withum. Her remarkable career was the subject of a term paper project by one of my Baruch College students, and I would like to share some of Karen's career lessons here. Karen had a lengthy interview with Martins Jukna-Parsons, a staff accountant at Withum and one of my students. The following was substantially prepared by Martins:
1. Always being a hard worker. When I was in college, I worked 40 hours a week while attending school full time. I worked my way up to managing an office of 25 people. I thrived on the work, which created many opportunities, including the responsibility of managing people in various phases of their careers.
2. My accounting professor's recommendation. He recommended me for my first job in public accounting with Lutz and Carr. I was a good student with a 3.8 GPA, always participated in class discussions and got to know my professors well. I was interviewed by one of the partners, Robert Fried, and a third person. Robert was a senior accountant at that time, and we worked closely together and eventually married.
3. I always loved ballet. Mr. Carr was a fanatical ballet lover and his firm had many major ballet clients as well as Broadway shows and major theaters. I was very excited about getting the job there. Further they were a smaller-sized firm and I figured it would present opportunities for more intensive work and to be recognized and move up quickly, which is what happened.
4. I worked as much as I could. I was never afraid of work, and at Lutz and Carr I loved everything I did, taking on more and more responsibilities. While half of the clients were in the entertainment business, the other half were a wide range of everything else and I got to work on those clients too. My experience bank was growing daily and that spurred me on to taking on more work. I was in a once in a lifetime situation and loved every minute of it. I worked nights, weekends and like crazy, every chance I got. To further excite me, Mr. Carr took me under his wing and had me shadow him to some very important meetings such as with the mayor of New York City and many well-known producers and stars. I was 24 and meeting all of these people. I became a partner in eight years.
5. Marrying Robert Fried. I was totally devoted to my career, and my first marriage only lasted three years. By then, Robert Fried was also divorced and we got together. Robert was at Lutz and Carr three years longer than I was and had the same excitement and work ethic, and we hit it off in every regard. We did find time to have a baby and we also had Robert's two girls from his first marriage. While the work was still all-consuming, it became a little less all-consuming as our interests shifted toward the family.
6. The traditional CPA compensation model. As time passed, we felt Robert and I had the biggest burden of the work and responsibilities falling on us. We had no life whatsoever. Additionally, while we were handing clients with about half of the gross revenues, this was an "old-time" CPA firm where the profits were divided by ownership percentages and not efforts, outputs or results. Robert and I realized we were locked into a place we could not grow from since we had the lowest percentages.
7. Starting our own practice. We decided that the compensation for what we were doing would not be attained for quite some time and came to the realization that we needed to make a change. Robert was there 17 years and me 14 years. We had a non-compete for two years but figured we would still do all right with the experience, skills and contacts we had, and decided to leave. We formed FK Partners and started our practice at the beginning of 2003. One of the clients we worked with came along, giving us work he had other firms doing, and he gave us an office. The rest, you might say, is history.
8. A key staff person couldn't work for a month in the middle of tax season. Our practice grew quickly and became the dominant accounting firm serving Broadway shows, the theaters and the peripheral businesses in that industry. We specialized, but it also included the real estate and investments of the producers and other clients. A key staff person threw his back out and was out for a month starting on February 20. His primary responsibility was to handle the over 8,000 K-1s that needed to be provided to investors in our clients' shows. We got it done, but this was a game changer, although an unfortunate one. We realized we needed more support and some professional management. We grew rapidly and were certainly making a huge income, but Robert and I were client focused and were not able to devote the necessary time to manage the growth or even draw up a plan to bring someone in to do that for us.
9. Merging with Withum. We had known Bill Hagaman, the CEO of Withum, for a few years. He was persistent and kept in regular touch with us without ever applying any pressure whatsoever. He wanted us to know he was interested in us and wanted a shot if we ever decided to merge upward. We merged seven years ago, in 2016. We had a great niche and, while we brought much to Withum, Withum brought order, a larger organization and — with us aboard — the ability to get larger clients, and a monetization of the business we built. The first two years integrating our entrepreneurial structure into the larger firm was bumpy, but Bill was a consistent supporter and one day, voila, everything fit together. Robert and I have not fully retired, but we shifted into a much lighter, less intense schedule. We are still available when a client needs us. We spend more time in Florida and moved to Massachusetts and will be opening a small restaurant in Lenox. It was one of our all-time favorites and, when the owner told us he decided to bow out, we took it over.
10. Our client service focus. For Robert and I, it has always been about the client. We always wanted to be where we were needed, and then some. Many of our clients have told us they did not think of us as their accountant, but as their "partner." We were always available. When COVID hit, Broadway was shut down. No one knew what to expect or do or when it would reopen. We maintained constant contact with our clients. I did over two dozen COVID seminars that first year. We were there and available. The same when Signature Bank went under. We were there with our clients. This wasn't a nine-to-five business; it was a 24/7 collaboration. We didn't bill every minute and didn't clock every hour, but we did very well and it was because our clients recognized our contributions and value. And we had fun! Without the clients, you do not have a business. We recognized this and so did Bill, and we think that's why he wanted us to join together with Withum.
11. The quality of our mentors. You asked for my top 10 game changers, but we have to include a No. 11 for the value of our mentors to our growth. Robert Carr was an invaluable mentor, always guiding and encouraging me and leading me forward. So was Alan Gordon, our first client and an extraordinary leader and businessperson. Producer Richard Frankel and I literally "grew up together." Others included Bernie Gersten, founder of Lincoln Center Theater, Joe Papp at the Public Theater, and most of my clients, who always were pushing and moving forward and including me "at their table" when decisions needed to be made. The point is we are not in this alone and almost anyone you interact with has the potential for you to learn from. However, a few special people take the time to make sure you learn it right, and those are the true mentors.
The above was organized by Martins Jukna-Parsons, based on a lengthy interview with Karen. The details from his notes from that interview would comprise a minicourse on managing client relationships and growing a practice. I know Karen and her work ethic mirrors mine, as did her interactions with Bill Hagaman, who truly knew how to put together and lead Withum into the powerhouse practice that it is today.
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