Five Questions with Tom Gray, Head of California for Fontas Advisors
A seasoned strategic advisor and government affairs strategist, Tom Gray joined Fontas Advisors as Managing Director and Head of California, bringing his unique cross-functional approach to expand the firm’s capabilities to the Golden State. Under Tom’s leadership, the expansion to California underpins Fontas Advisors’ growing presence as a leader in state and local government affairs as the firm continues to meet and anticipate the needs of its clients, which increasingly face similar public affairs challenges on both the East and West Coasts.
From Kuwait, where you were based while in the Coast Guard, to NYC, to the Bay Area, you’ve had a diverse set of career experiences so far. How has this influenced your approach to your client work?
Teamwork has always been core to my work. Obviously, this was embedded in the culture of the Coast Guard. But, I also came to learn the importance of collaboration during my career in public service in New York and through my client work so far in California.
Many in our business jump from issue to issue and have somewhat of a transactional relationship with their clients but I prefer having the opportunity to build long-term partnerships. Sure, getting a client through a crisis or a key legislative decision is critical to our work. But, what I find most rewarding is offering my perspective as an outside advisor while maintaining the same commitment of an internal employee.
Luckily Fontas Advisors shares this approach. I’ve been impressed watching George build a business that is designed around delivering results with superb client service instead of simply maximizing the volume of client accounts. Over the past few years, I’ve been fortunate to work with many of my clients such as Accenture, Centene, and IBM with this same model of long-term partnership. It’s incredibly motivating to work with clients in this manner, balancing today’s needs with the ability to prepare for the challenges and opportunities that are around the corner.
New York and California have long represented the face of modern progressive politics. How does this impact companies doing business in these states?
Today, many progressives in both states (and around the country) are focused on pursuing social progress, which often means targeting big business. Progressives would like to restructure markets — everything from real estate, to talent, to education — to change how they work and who they reward.
For California and New York, progressive politics often equates to additional regulation, which is not just a challenge, but also a real threat to many business models. We are seeing increased scrutiny, red tape, and new barriers to business across nearly every sector. For example: real estate developers nationwide must comply with affordable housing mandates, delivery apps are being reined in by New York and other progressive states, and California recently tried to classify nearly all workers as W2 employers, doing away with independent contractors.
In order to change the tide and support our clients in creating an environment that is friendlier to their company’s offerings, we develop and execute a multidimensional strategy that drives progress on multiple fronts. We bring this mindset to all of our clients from global corporations like Accenture, to high-growth tech companies such as Lime, to leading local nonprofits such as LISC Bay Area.
In addition to bread and butter government affairs legislative and advocacy work, we prioritize relationship building, stakeholder engagement, and risk management as we aim to build a ‘reputation safety net’ and identify champions in government ahead of any potential issues. With today’s progressive backdrop in California and New York, we believe this type of approach not only positions our clients well among government officials, but also allows us to identify opportunities and risks before they become mainstream.
State and municipal government affairs has typically been a hyper-local game. What’s compelling for Fontas Advisors about a bi-coastal and multi-office approach?
Surveying the wider landscape, there are a few trends that have converged. First, as we emerge from the pandemic, business is navigating an unprecedented public affairs ecosystem that has highlighted the wide-ranging authority of state and local government. In addition, the intense gridlock we’ve seen in Washington, D.C. over the past several years has also driven an increase in policymaking at the state and local level, with state and local officials taking over duties that Congress is too paralyzed to handle.
Furthermore, as technology and digitization continues to proliferate our society and all sectors, we have also seen a number of highly disruptive tech-enabled companies that have opted to eschew local regulations to grow at all costs. This has resulted in “the Uber effect,” with most state and local governments now reluctant to accept new innovation, after feeling burned by some of the earliest movers in this area, such as Uber.
Finally, political polarization between Democrats and Republicans and within each individual party has created an environment in which elected officials at the state and local level feel more empowered than ever to share their perspectives and propose legislation.
As a result, the policy issues that we are seeing here in Sacramento, for example, are the same or similar to the challenges cities and states are facing across the country. For Fontas Advisors, that means that our team’s experience and strategies from one market often apply to other markets and we have the opportunity to partner with our clients to create solutions beyond the borders of just one city or state. We are committed to partnering with our clients as they return to full speed post-Covid by utilizing the lessons we’ve learned in New York, applying them in California, and vice-versa, driving success on both coasts and hopefully everywhere in between.
Why expand to California as the firm’s first market outside of the New York region?
California has the fifth largest economy in the world. The state ranks just behind the UK and India in terms of the size of its economic output. Much like New York, it is a global hub of business activity where there is an extraordinary amount of overlap between government, business, and the nonprofit community.
Every day at Fontas Advisors we see companies in California and New York seeking to do business with one another and with government officials in Sacramento, Albany, New York City, Los Angeles, etc. Four of the top ten biggest cities in the country are in these two states. We’re excited to offer our clients a unique opportunity to work with the same boutique firm with deep local expertise and networks across both the California and New York regions.
Finally, in the age of Zoom and remote work, we still believe that in-person connections matter. We have a growing number of California-based clients and having staff on both coasts increases our ability to collaborate with these teams and develop a personal relationship over a drink or a meal. We find this proximity helps us drive long-term partnerships with our clients and better invests our team in their success.
You frequently work with companies who are just entering the California market or looking to do business with state and local governments. What’s the biggest benefit for these firms of partnering with Fontas Advisors?
Risk management is critically important for companies entering California and New York, or really any new market. I have seen companies make the same mistake over and over. They think they can get the lay of the land and, before they know it, they have wasted significant money and time talking to the wrong people the wrong way and have made no inroads.
Local expertise is crucial, and takes years to develop. I have been at it so long and appreciate it’s both an art and science. And, as I mentioned earlier, relationships really do matter, especially when you get to a point in your career like me and now have the chance to work with your former interns who are now commissioners and senior leaders in California, New York, and in other important jurisdictions.
In addition, despite encountering many of the same issues across markets, most companies tend to underestimate the vast differences between different governments – not just in terms of structure and policies, but also in terms of culture and decision-making processes. California is not just immense, but also highly diverse across nearly every dimension, resulting in a multitude of interests across the state that don't always align.
So, understanding the infrastructure and systems underlying each jurisdiction is just as important as having relationships with key people within the ecosystem. We work to make sure we have a diverse set of partners to bring in to meet the needs of any particular client or mission. For example, Jovan Agee, former Deputy Treasurer for the State of California is a senior advisor to Fontas Advisors helping to open doors for our clients and advise on strategies.