About
I have had an interesting life; which fortunately ended up with me selling my telecoms business for £11 million ($20 million) in 2004. This followed my previous company going bust in 1993, leaving me and my family destitute and without any income.
I’d like to share my story with you; with all it’s ups and downs. How I went from failure to real success. People tell me it’s an inspiring story.
I’d been in a small business, as a 50/50 shareholder, which was a retailer, wholesaler and installer of polyester window coatings. I joined that business after 13 years of a relatively successful career in IBM. We grew the business from virtually nothing to £¾m turnover in 4 years but, as with many partnerships, we didn’t get on. I was ambitious and looking for growth. My partner started pulling in the opposite direction. So I left and started on my own, in the same field.
Smart move! Right at the start of the big recession at the start of the 1990’s. The company survived for just on three years before going bust in 1993, leaving me with personal debts to banks and others of around £250,000. I made just about every mistake possible in those 3 years; mainly in my quest for turnover (and profit?).
I’ll tell the story of those years on another day; they’ll ring true with many business owners.
So in 1993, I had no money, no income, a bank after me to repay the overdraft, a mortgage company after me to repay the loan on the business property and some nasty people who I’d borrowed money from wanted their money, too. I’ll tell you all about how we dealt with this, too, another day.I’d had some dealings with South Africa and I went there to try and make some income. That led me to Nigeria. Loads of interesting experiences, right at the sharp end of life. Again, stories for another day. I scratched an income in Africa, without making any progress on my debts, right up until November 1995 when my long suffering wife put her foot down and said either get a job or try this. This was an advert for agents to sell Least Cost Routing for telephone calls.
I knew nothing about telecoms, apart from speaking down one, but felt that my experience in business – and I could at least sell – would be ideal; and I saw big potential. So, on January 5, 1996, I went up to London to First Telecom in the Docklands, for training. And my new company, Uniworld Communications, was born.
I worked for 2½ years on my own, from my little study at home*, cold calling customers and offering to help them with their telecoms and reduce their costs. I can’t say I’d really sold like that before but there was no alternative. I couldn’t afford to get anyone else to make the calls for me. So I grinded on every day, determined to dig myself out of my hole and make a success of myself. I really saw telecoms as my last chance.
Every customer I sold paid me an ongoing monthly commission of 5%. So, if I sold the service to someone who spent £300 a month on phone calls, I made £15 a month commission. Or £180 a year, if you like. Where else could I get a pay rise of £180 a year for selling one customer. If I sold 10 customers, I effectively had an annual payrise of £1,800.
Within those first 2½ years I learnt three key lessons:
- Start off slowly and in a small way. Keep your overheads small and give your business a chance to flourish. You also get a chance to learn about the business and get in a position of control.
- You are in the selling business. It’s the only thing that counts. I just spent every day seeking and acquiring new customers. I sought ways to make me look different to the thousands of other people doing the same thing.
- That if you are focused and you are doing the right things, then the world somehow conspires to help you. The first instance of that was in mid-1998 when the telecom companies I was working with decided that they needed to double my commission to 10% of monthly billing.
That last act, the doubling of my commission combined with my achievement in 1998 of monthly billings of £100k, gave me a monthly pay packet of £10k. I was now in a position to start paying off my creditors (albeit in a small way) and to take on my first employee. I needed that additional person because I had a lot of customers who I needed to take good care of whilst I needed to continue to focus on new customer acquisition. I was still in the sales business!
I was also in the position to spend a little money each month an paying a telemarketing operation to make appointments for me, freeing me up to spend time visiting the clients.
We went from strength to strength, picking up customer after customer, and still selling the same thing; lower cost telephone service. I never wavered from that focus, but always finding different ways to capture customers’ interest. After all, there were thousands doing the same as me and I had to appear to be different. That story can keep for another day, too.
By end 1999, ie 4 years into the business, I had been joined by my son Ashleigh, who built our back-office systems and we’d moved out of my tiny study into a business centre where we were paying £50 per week in rental. I was also making reasonable money which went on paying off our creditors. Progress with this was slow but, just by paying them a small sum every month, they were a lot happier than before.
It was in 1999 that I started to have concerns about the technology boom turning to bust. If any of the companies I was dependent upon for my income went bust my monthly income went with it. And I was determined that wasn’t going to happen. I felt comfortable with Colt Telecom, but had my worries about RSL and First Telecom.
I had by now built up a decent balance in the bank and they were agreeable to providing us with a direct debit facility. Armed with that I went to RSL and told them I wanted to be a reseller; ie invoice customers ourselves and pay the telco the cost rate for the calls. This gave us a margin of around 30%; a lot more than the 10% commission. But we incurred the cost of installation, administration, customer service and billing. Plus we carried the debt risk. I minimised the latter by stipulating that no customer would be greater than £250 per month.
We started slowly and by the end of the first year had a monthly billing of £30k plus, of course the continued commission income.
In 2000, my fears about the telco’s began to materialise. RSL went bust and was followed by First Telecom. I remember sitting on holiday in August in Lake Garda (by then I felt able to take a break) working out how we could plot our way through this problem. Every morning, at 6am, I’d be on the terrace with paper and calculator (still no laptop, then) working it out all the different scenarios. We had cash in the bank, although we were working through this paying for the new customer set up costs (which could be substantial), and I had switched lots of customers from the vulnerable telco’s to COLT who were better funded and better run and who’d be able to carry on paying my commission.
In 2001, we grew the sales to £200k per month ie £2.5 million annual and then it all started to kick off – big time.
At the end of 2001, we had brilliant back office systems, my son Ashleigh was in control of everything technical and IT; he was so knowledgable in telecoms matters, and my wife had joined full time and ran finance, especially credit control, with an iron fist.
We had around 15 staff by then and the missing pieces were being slotted into the jigsaw. I lacked an outstanding operations manager and we needed someone who could go through every customer and see where better routing could improve our margins.
The operations manager problem was solved when a 23 year old girl, Joanna Hilsden, turned up looking for a job. I thought at the interview “she looks promising” and she was. Within 3 months she was leading by example and within 6 months I made her Operations Manager. She matched my standards for excellence, perfection really, in customer service.
In December 2001, I had called my youngest son, Graeme, who had been in Australia for 15 months, and told him the business was on the move and that his brother would probably end up quite wealthy. If he wanted it too, then he had to come back and work for it. He said “no, he was happy in Australia and that he’d rather stay there”. 15 minutes later the phone rang. Graeme said he’d thought about it some more and he’d be home in two weeks. He did come. He was brilliant. Worked his socks off and improved the margins by over 4%. On £3 million annual turnover, that was an extra £120k profit a year.
Lastly, I’d been joined by an ex-customer, Richard Hisom. He’d joined to give us the telecoms data expertise that I felt we needed. It turned out we didn’t need that, but we needed a Dealer Channel Manager. Richard did that fantastically and built a dealer channel of 350 people, all bringing us some business every now and again. Some brought in business regularly.
With all those bits coming together we started going after bigger clients, and created an automated sales proposal system, so that we could overcome the problem of crap proposals and which took us hours to create. The proposal system has taken on its own life, and I’ll tell you more about that in my next blog.
Between January 2002 and January 2004, we grew our annualised turnover from £3 million a year to £23 million a year. A growth of 600%.
In March 2004, we sold Uniworld Communications for £10.7 million ($20 million). My family all received good payouts, related to what they’d put in and so did Richard and Joanna with their share options.
That just left the staff and the dealers. I could no more abandon them and walk of with my bag of cash, than I could my family. So, my wife Barbara and I, hatched a plan that we would put a percentage of the sale money into a fund which would be shared amongst the staff based upon the number of years they had worked with me. Heather, the lady who joined me in my study in 1998 got the highest payout. I thought this right.
I set up a second fund for the dealers which rewarded them for the amount of business they brought the company.
It was important to Barbara and I that the people who got us where we were also did well.
Long before the sale of the company, we’d already paid off all the creditors out of our salary and dividends. We’d also paid off our mortgage and had cash in the bank.
So, we had truly gone from bust to boom. From destitution to relative affluence.
We still live in the same house. Our friends are the same friends. People say we haven’t changed one iota.
I think I have changed. I am just more confident in my abilities and I’m more prepared to give advice to others in business. I honestly feel I have earned that right.
I learnt a lot of lessons along the way, especially in the business that went bust. And I was able to employ those lessons in Uniworld Communications. I don’t really think we put a foot wrong in all of those 8 years.
I feel someone has been looking down upon us because as soon as were faced with any dilemma the solution would appear.
Now Joanna, my son Graeme, Jo’s brother Nick, and I have set up our new business, ProposalGENie. We write sales proposals for clients and then automate the process so that anyone in the organisation can produce brilliant, customer centric proposals in minutes. It worked for us at Uniworld, and we think it will work for other businesses. We’re 18 months in to ProposalGENie and it’s been an interesting experience. I’ll share that with you in a forthcoming blog.
I hope you have found my experience interesting and, if you are, or want to go into business, inspirational. It happened to me, and it can happen to you.
