Spring 2019
Power of the network Growthdeck is all about people. In this issue we illustrate how the power of the network is bringing benefits to investors and companies.
Building out We’re getting very excited about our new property investment service, scheduled to launch in June this year. Find out more inside.
If the shoe fits
growing up Clarks is synonymous with comfort, style and affordability. Hugh Clark, a new member of the Growthdeck network, tells us about its history.
an occasional magazine for the sophisticated growth investor
Issue Two – Spring 2019 an occasional magazine for the sophisticated growth investor
Welcome!
Growthdeck 59 Grosvenor Street Mayfair London W1K 3HZ
growthdeck.com
504-506 Elder House Elder Gate Milton Keynes MK9 1LR
Selected contents Power of the network Find out why Growthdeck’s connections
Here we are already at our second issue of Growing Up, and what a start to 2019! We’re delighted to announce that we’ve successfully raised £3.5m of growth capital. This will enable us to build out our personnel in key areas – such as the Investment team, Business Development and Client Services – as well as carry out more promotion and develop our infrastructure. I would like to say a huge ‘thank you’ on behalf of the team to all the longstanding Growthdeck shareholders that continue to support us, and the many new ones that have just joined us. Growthdeck is unusual in the way that shareholders are such an intrinsic part of the business, sharing in our successes as well as providing vital input into deals and strategy. In this issue of Growing Up, we provide some more detail on our plans for 2019 and beyond, as well as the latest on deals, the wider industry and some more profiles of the people in our rapidly expanding network. I hope you enjoy reading it, and look forward to seeing you during the year.
help create a powerful ecosystem.
DreamSkin A fast-growing business that is already well on the way to global success.
Supply & demand Teacher supply is a modern UK problem, but help may be at hand via technology.
Building out Read about the forthcoming launch of our commercial property investment arm.
Duly diligent Growthdeck takes a very thorough approach to due diligence. Find out how.
Life through the lens Eyewear is both fashion and necessity. Kirk & Kirk is flying the UK flag.
Ian Zant-Boer
Meet the management Every month our investors get to meet our businesses over a private lunch.
CEO, Growthdeck ian.zant-boer@growthdeck.com
Young Enterprise Find out how Growthdeck has been supporting this national charity.
the power of the network Growthdeck is all about the network. When you join the thousands of other investors, industry experts and entrepreneurs, you become part of an ecosystem designed to capitalise, support, and participate in the growth of exciting UK businesses.
In this issue of Growing Up, we meet a few of the people that make the network special, including rising Growthdeck star Allyson Clarke, successful entrepreneur Rosie Whaley and, from the family behind one of the UK’s most recognisable brands, industry sector expert Hugh Clark. But, first of all, we’d like to welcome some new faces to our growing teams in Milton Keynes and London, all of whom bring huge experience and unique skillsets to Growthdeck.
And, this year, Growthdeck is preparing for accelerating expansion itself. Having raised £3.5m of growth capital, we are busy building out our Investment team, Business Development and Client Services, with several new hires. We’re also implementing a carefully-targeted promotional strategy, enhancing our bespoke platform, and focusing heavily on making our business more diverse, inclusive and fit for the next decade of investing. Above all, our primary aim will be to extend the effectiveness and influence of our network.
Our network
RETURNS
INTRODUCTION
Growthdeck Network + GROWTHDECK PARTNERS
FUNDED BUSINESS
GROWTH BUSINESS
FUNDING
SUPPORT
SUPPORTED BUSINESS
New faces Shaz Hussain
Investment Director Shaz brings to Growthdeck extensive experience in corporate finance and investment from the likes of Ernst & Young, PwC and Telefonica/O2. He has spent the last few years focusing on innovation and enterprise with Innovation Capital Partners, and in consultancy roles with various early-stage tech businesses.
Ceri Richards
Non-Executive Director Ceri recently joined the Growthdeck Board and brings considerable expertise to our business, with particular focus on our forthcoming property arm. Ceri is a highlyexperienced executive with a career spanning banking, construction and public sector roles, latterly as CIO at Laing O’Rourke. She is also a qualified accountant and a graduate of the Harvard Advanced Management Programme.
Matthew Rideout Head of Investment
Matthew joins us as the new head of our growing Investment team. Originally with 3i and PwC, his experience straddles CFO, COO and corporate development roles, with a background in corporate finance lead advisory and private equity investment. Matthew has a passion for entrepreneurial growth business, and has built and run several successful businesses in his career.
“
DreamSkin is one of those products that doesn’t come along very often. We knew pretty quickly that our investors would find it attractive, and so it turned out. Since our raise, the rapid progress of the company has exceeded most of our expectations.
Simon Emary COO, Growthdeck
Soft, smooth and in demand Skin is the human body’s largest organ. It helps hold us together and protects us from the harsh world around us. Yet many materials that we choose to put close to our skin are just not very friendly. In 2018, Growthdeck raised over £500,000 for DreamSkin Health Limited to fund the further commercialisation of its proprietary product – the DreamSkin® polymer. The patented polymer is a breakthrough in the management of skin conditions, such as eczema and dermatitis. The business already has two income streams, including the sale of 84 different premium silk garments to the NHS, as well as direct-to-customers. The material is made from the highest quality silk fibre and then treated with the DreamSkin® polymer, which helps to relieve itching and improve hydration of dry and damaged skin. The material also contains a class-leading, zincbased antibacterial that provides excellent control of typical skin-colonising bacteria within the garment. Effectively, you wear your treatment, so it’s easy to see why the DreamSkin® polymer is ideal for baby nappies – a fact not lost on the leading German pharmacy, DM, which has incorporated the polymer in its premium nappy brand.
A truly innovative product poised for serious global growth In fact, since our fundraise, DreamSkin has since gone on to secure major contracts with Marks & Spencer and a global-scale nappy manufacturer with multiple international brands, and is poised to experience significant growth, both at home and abroad. As a result, the company may not need to raise again with Growthdeck, but we’ll be keeping a close eye on its upward trajectory.
£500,000 raised | EIS qualifying Please contact us if you would like further information on raising capital with Growthdeck
our network – the rising star
Allyson Clarke Ally joined Growthdeck in 2016 and has been a key part of our Overseas Investors team since then. She’s also just been shortlisted in the esteemed Women in Finance Awards ‑ in the ‘Rising Star’ category.
As one of the youngest members of the Growthdeck team, she already has truly global experience, having grown up in America, spent considerable time in China and then emigrated to the UK. Ally is passionate about China – its language, culture, history and, of course, its people. She obtained a BA with a double major in Asian & Middle Eastern Studies (including Mandarin Chinese) and Political Science at Duke University, a Top-8 USA university, and was awarded a full merit-based scholarship by the University for academic achievement, leadership, and community involvement. While there, she also found time to play for their club soccer team. Ally is now able to utilise her Chinese language skills and cultural knowledge in her day-to-day role at Growthdeck, where she works with overseas investors who want to take a stake in growing UK businesses. The Tier 1 visa programmes attract wealth–creators and expand the UK’s business links around the world, by enabling HNW and UHNW foreign nationals to stay in the UK for certain periods of time, provided they invest at least £2 million in the UK.
As well as being a top academic performer whilst studying Chinese at Duke, Allyson has also spent considerable time in China. She has lived in Kunming, Yunnan Province, where she participated in an intensive language immersion programme, studied Chinese culture and history, and conducted independent research. She has also lived and worked in Beijing as a Business Strategy Analyst at WOW Consulting, where she used her language skills to initiate relationships with external companies to expand the company’s customer base. Whilst at university, she was also selected to participate in the Duke University-Fudan University Exchange Conference in Shanghai, where she presented research, led discussions, and debated topics with her Chinese counterpart. In 2018, Ally and colleague Samuel Hu were personally invited by the Department for International Trade (DIT) to present to investors in Shanghai, alongside the British Consulate General in Shanghai and the London Stock Exchange Group. Ally has played an important part in developing Growthdeck’s private investor network – it now comprises a growing number of overseas investors, from countries such as China, Malaysia, India and the US, who are able to invest directly in exciting UK private companies through our model, and we look forward to welcoming more thanks to her efforts.
“
These are really exciting times at Growthdeck. We’re seeing increasing interest from investors around the world, all of whom consider UK business to be a very attractive investment.
Supply & demand including the government, non-profit Most of us accept organisations, tech giants like Google that we live in a and private equity companies. digital world and Why is EdTech that technology is Attracting so Much transforming the way Attention? we live our lives. But Here are some of the main factors an often-overlooked driving growth and increased interest area where technology in this rapidly expanding industry: is having an increasing Government Support is Growing impact is our education The Department for Education (DfE) system. has now launched its long-awaited Educational technology, or EdTech, might bring to mind interactive whiteboards, augmented-reality headsets and cloud-enabled robots, but it is often less visible than that. Whilst there is some debate around the precise definition, it’s generally thought of as any technology that supports learning, teaching and the effective day-to-day management of education institutions.
Investment is Increasing Rapidly In line with the increase in EdTech adoption, investment in the sector is growing fast, with a significant jump between 2017 and 2018 figures. Beauhurst, the market researcher that specialises in tracking private companies, reports that £90.9m was invested into UK EdTech companies over 2018, distributed over 50 announced investments, compared to £66.9m in 2017. This figure marks the highest amount invested into the sector to date, and a 140% increase on the amount invested in 2016, demonstrating just how much the industry has grown so far. Investment in the field comes from an ever-increasing number of sources,
EdTech Strategy, which sets out plans, backed by £10m funding, to support innovation and ‘realise the huge potential of technology to transform our schools’. The DfE has declared that supporting the development of the UK’s innovative SME EdTech businesses will be key to the success of its new strategy, and it has laid out its commitments towards achieving this. The list includes creating new opportunities for buyers to meet vendors, facilitating a better online marketplace for EdTech and generally supporting businesses in promoting their products and services, providing access to expert support and advice, and ensuring that businesses can access the finance they need to start, scale and grow, to name but a few. It has also set out its intention to work with the British Business Bank and a new EdTech Leadership Group to ensure that potential EdTech investors and EdTech innovators are aware of, and can benefit from, the array of options available. Relentless Pressure on School Staff and Budgets There is currently real pressure on school budgets across the UK, which contributes to the serious, intertwined
issue of teacher recruitment and retention. It is hoped that the tech sector can increasingly cut costs for cash-strapped schools which have been operating on very limited budgets and the goodwill of burntout teachers for many years. A recent National Education Union survey revealed that 4 out of every 10 teachers in UK schools plan to quit the sector. One of the key challenges put forward to the industry in the government’s Strategy is seeking to reduce the burden of ‘non-teaching’ tasks, which could include, for example, time spent on staff time-tabling and recruitment. This is where providers like EdTech platform Teacher Booker can make a real difference. Schools often have an urgent need for contracting supply teachers at very short notice, which is currently provided inefficiently and expensively by recruitment agencies. A secondary schools survey carried out by the Association of School and College Leaders found that more than 70% have increased their spending on agency supply teachers over the past three years and that the teacher recruitment crisis is a major factor in driving up costs. A Motivating Factor for Students Regardless of generation or age group, technology can be a motivating factor in the classroom environment. Given millennial and digital-native students’ interest in, and level of acquaintance with, technology, EdTech tools can assist with engagement and motivation, particularly through the ability to personalise experiences for individuals. For example, in the case of programmes and apps, appropriate difficulty settings and goals can be set in line with individual students’ progression, which can add a gamification aspect to the learning experience.
Whilst tech can be thought of as clinical and impersonal, it’s been reported that it can actually help teachers build better relationships with, and understanding of, individual children – which, in turn, can improve both academic performance and school attendance levels. But there is still a lot to learn – future research will help to clarify technology’s role in boosting student motivation and engagement levels, with more rigorous research needed.
Things to Consider As with many industry sectors, there are several barriers to starting and growing a business in the EdTech market. Here are some of the main challenges that potential investors in EdTech companies should bear in mind. Does it Solve a Genuine Problem or Need? A key consideration when looking at the EdTech sector is whether products and services actually solve a problem – is there a genuine need for them or are they simply a “nice to have”? Whilst technological advances mean increasingly alluring products are coming onto the market, bringing the likes of virtual reality and holograms into the classroom, is this actually helpful? It’s important to remember that EdTech has the ability to hinder rather than help – for example, through increasing teachers’ workloads, with concerns that they can effectively become slaves to the technology, spending a lot of time training with it or preparing lesson materials that may not be necessary. With key issues in the sector including budget limitations and overworked teachers, genuinely useful products and services are likely to cut down on either workloads and/or costs, or perhaps provide means of standardisation or replace inefficient processes, rather than simply applying cosmetic improvements. Improving Dialogue is Key The burgeoning EdTech industry is frequently accused of failing to form relationships between the key parties in the ecosystem. It may well be true that few education entrepreneurs can grasp the responsibilities and problems that educators face on a daily basis in our schools, and there is a feeling that many EdTech providers have built products to replace teachers rather than assist them and meet their needs.
Emma Robins Head of Content & Social, Growthdeck
The DfE’s EdTech Strategy talks of needing to support a partnership between the EdTech industry and the education sector to ensure product development and testing is focused on the needs of the education system rather than being carried out in isolation. Collaboration and improved dialogue will undoubtedly benefit the whole system. Fast Paced – Staying Relevant and Up-To-Date With technology moving so fast, there are valid concerns that any EdTech offering(s) educators invest in could require bug fixes to operate smoothly and may require updating to stay relevant, with the risk of even being superseded and made redundant. With this in mind, it’s important that products are built and developed to be “future-proof”, scalable, and stay relevant. Concerns about updates and staying relevant in such a fast-paced industry only add pressure where budgets are concerned, since there is a risk of being tied into potentially ineffective, or just poorly suited, products in the long-term. How do educators work out what the right options are for them, their students and, of course, their budgets? Whilst there is LendEd, an online lending library that allows test-driving of products, there is still much to be done on this front.
Conclusion The pace of change in the exciting EdTech sector looks set to continue, if not increase, and the government’s EdTech Strategy should help foster further innovation within this fascinating industry. EdTech exports are now worth an estimated £170m to the UK economy and 2018’s investment levels into this field demonstrate investors’ growing interest in EdTech’s potential for transcending resource restrictions, such as teachers’ precious time and budgets. It’s clear, however, that we have only just scratched the surface in terms of EdTech’s enormous promise when it comes to tackling some of the main issues facing our education system today. EdTech has the power to lead a revolution in schools, with it set to transform the future of how education is resourced and taught, and ultimately, the results that it can then produce.
Teacher Booker Earlier this year we welcomed Teacher Booker to the Growthdeck platform. Teacher Booker is a powerful, web-based tool that enables schools to manage staff administration with particular emphasis on contracting supply teachers. Teacher Booker sources teachers and support staff and performs all the necessary compliance and background checks for 20% of the cost of traditional agencies that charge £800 per teacher. Schools can review, directly contact, book and pay these teachers for both short and long-term roles with no daily commissions or finder’s fees – unlike other competitors. Teacher Booker can help reduce the pressure on UK schools to cut costs while maintaining satisfactory staffing levels. It benefits both the institution and the teacher, by reducing the high commissions taken out of the system by recruitment consultants. The platform is already nearing 5,000 teacher registrations with c.100 schools using or implementing the service. This has been achieved with minimal promotion. In addition, Teacher Booker has secured a contract with a major regional education services provider that will provide direct access to a large number of schools.
£650,000 being raised | EIS qualifying Please contact us for further information, or visit: www.growthdeck.com/teacherbooker
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Growthdeck shares the exact same focus on due diligence, selected opportunities and investor relationships as we do in our careers as professional property developers. We’re very excited about combining our industry expertise and insight with the fast-growing network of investors and highly experienced team at Growthdeck. Michael Ross, Director, CNM Estates
Launch event June 6th from 12 noon Balls Brothers Austin Friars London EC2N 2HG
Join us for drinks and nibbles and find out more about our exciting property investment business growthdeck.com/property
We are launching our brand new commercial property investment service. Growthdeck investors will have access to carefully selected investment opportunities in projects where we can add value and help maximise returns.
All of our opportunities will be available as a direct investment or via a suitable pension plan (SIPP/SSAS). Growthdeck is teaming up with Michael Ross and Andrew White, two seasoned property development professionals who, between them, have over 50 years of experience and have worked on a wide range of successful projects. For further information please refer to our property investment factsheet, visit the Growthdeck website or speak to one of our team.
Commercial Property Investment
Duly diligent One of the key reasons investors value the Growthdeck model is our stringent and expert approach to due diligence. Our Investment team and wider management have decades of investment experience from both the private equity arena and other investment sectors. The Growthdeck due diligence process draws upon the best elements of these to ensure that it is both thorough and expedient and allows Growthdeck the opportunity to develop and cement its relationship with the company through the procedure. Here is a breakdown of all the work we do before a deal goes live.
Headline terms agreed and an engagement letter signed
1
2
Initial assessment
Sector expert view
Growthdeck gets upwards of 100 approaches a month from businesses seeking funding directly, or from our wide introducer network. Most of these are declined at the outset, failing to meet one or more of our standard investment criteria. The remaining few will pass through a more detailed assessment, that includes reviewing the available financial information, researching the management team, making checks at Companies House and other available data sources, plus benchmarking against comparable businesses.
The next stage is to engage a member of our expert panel. Thanks to our rapidly expanding network, we have a growing number of industry experts with detailed and hands-on experience across various sectors. Many have built or managed successful businesses and can quickly give us a sense of the company’s potential. After a desktop review, if we feel the deal “has legs”, an expert is invited to get involved. Following the collection of data in stage three, they then carry out site visits and an in-depth assessment of the personnel, products and market.
The Growthdeck Investment team draws upon significant deal experience, from roles in corporate finance advisory and private equity investment, as well as hands-on operational experience in high growth and equity and debt-funded businesses.
Very often our sector experts will make an investment themselves in the company and then become the Growthdeck Appointed Board Representative, or join the board as a Non-Executive Director. This ensures that Growthdeck adds significant value to the company postdeal, by adding relevant experience, providing routes to new markets, opening up their ‘black book’ of contacts, and helping to develop the infrastructure to support the company growth.
Request for information An essential part of the due diligence process is for the investee company to provide detailed information on the company and its directors, trading history, key customers and suppliers, the financial forecasts and assumptions underlying them. This step also provides the required information to satisfy our strict compliance requirements and to produce the investment memorandum. The collection of information is also a test of the management team’s capability. We normally expect this to be completed in a set period, and will terminate if the deadline is exceeded without good cause. • • • •
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4
In practice, this is a collaborative process and allows the Growthdeck team to develop a stronger relationship and more detailed understanding of the business and management team. From this stage we would expect a deal to complete within the following 12 weeks. Very often this can be foreshortened depending on the number of other deals live on the platform.
Opportunity goes live on platform Investment Memorandum published Investor presentations Meet the Management lunch
5
Deal completed
6
Investment committee
References
Ongoing diligence
Our Investment Committee is tasked with selecting companies that make it to the fundraising stage. It acts as a key filter in the deal process, confirming the company valuation and terms of investment, and is where opportunities that fall short in the eyes of the panel can be weeded out before presentation to investors.
Having confirmed the headline terms agreed at the outset, or agreed revised terms coming from the Investment Committee approval, we finally take up references on the management team, as well as key customers and suppliers.
All of the steps detailed here need to be completed before we publish the investment memorandum and the deal goes live on the platform. There may be non-critical elements of the due diligence process that can be completed between that point and the final closure of the deal.
The Investment Committee is made up of key members of the business and steered by a chairman. Each deal is presented by the leading Investment Director, with support from the sector expert. The Committee is autonomous from the deal process and so acts as an independent sounding board. Rather than reject a deal, they may also determine areas for further investigation and due diligence that must be satisfied before the deal is allowed to be presented to investors. The Investment Committee will also determine the need for Non-Executive Directors over and above the Growthdeck Appointed Board Representative.
Additionally, investors often raise detailed questions once the deal is live and the business has presented. The Investment team will then answer these questions from the information provided or liaise with the investee company and seek further clarity.
Investor visas up 19% Years of Brexit drama haven’t dampened demand from wealthy Chinese for UK Investor Visas, as demonstrated by data we have obtained from the Home Office.
Samuel Hu, our Head of Overseas Investors, says: “Thankfully for the UK, international High Net Worths are willing to look past all the Brexit political chaos. For them, the fall in sterling makes UK assets look cheap and a further volatility another buying opportunity.”
The number of Chinese High Net Worth and Ultra High Net Worths applying to live in the UK on Investor Visas increased 19% last year to 144*, up from 121 in 2017.
“A rise in applications may also reflect a broader shift by Chinese High Net Worth investors away from investment in domestic markets, where growth has slowed in recent years, towards more developed markets.”
Chinese individuals made up 63% of all Investor Visa applications in 2018 (228), up from 50% of all applications in 2017 (243). Number of Chinese HNW investors applying for Investor visas has increased
“We can complain about the current political situation in the UK but to a HNW it looks benign compared to some countries in other markets.”
“Regardless of Brexit, there are many areas of the UK economy exhibiting strong growth - there is a wealth of investment opportunities available for individuals applying for an Investor Visa.”
150
120
90
The UK may also be benefitting from some HNWs choosing the UK over an equivalent investor visa programme in the US which has been harder to use for Chinese High Net Worths. The ‘EB-5’ visa programme in the US has become less popular amongst international HNWs since the Trump administration came to power – raising questions over its future. Also, approvals for the EB-5 visa can now take as long as 10 years, creating long waiting lists to apply. The second highest number of applications last year came from individuals from Hong Kong at 26. Applications from Russian individuals halved last year to 24, down from 48 in 2017. Investor Visas entitle individuals to remain in the UK for 3 years 4 months, with the possibility to extend for two more years. Applicants must invest £2m or more in share capital or loan capital in active and trading UK registered companies. New reforms from April 2019 require applicants to prove that they have been in control of these funds for at least two years. The Government was planning to halt the Investor Visa programme amidst concerns that adequate compliance checks were not being conducted but this was overturned following strong opposition.
60
30
judicial system, with a track record of protecting investors from the state seizure of assets, which still occurs in some emerging markets.
2015
2016
Our data and commentary has been covered by Bloomberg (Wealthy Chinese Still Beating Path to UK Even With Brexit Woes), as well as Brazil’s largest financial newspaper, Valor Econômico, and publications in Vietnam and Singapore.
2017
2018
Despite the Brexit-related uncertainties, the UK remains an attractive location for High Net Worth investors from emerging markets as it is considered to be one of the securest jurisdictions to hold assets. The UK has a stable political and
* Home Office, 2019. Year-end 31st December
Your inheritance The Enterprise Investment Scheme (EIS) can help investors reduce their Inheritance Tax (IHT) burden. Inheritance Tax is a tax on the estate (the property, money and possessions) of someone who has died.
Illustration
There is normally no Inheritance Tax to pay if either: •
the value of your estate is below the £325,000 threshold,
•
you leave everything above the £325,000 threshold to your spouse, civil partner, a charity or a community amateur sports club.
Estate value
£500,000
Tax-free threshold
£325,000
Taxable amount
£175,000
Tax payable @ 40%
£70,000
If you give away your home to your children (including adopted, foster or stepchildren) or grandchildren, your threshold can increase to £475,000. If you’re married or in a civil partnership and your estate is worth less than your threshold, any unused threshold can be added to your partner’s threshold when you die. This means their threshold can be as much as £950,000. The standard Inheritance Tax rate is 40%. It’s only charged on the part of your estate that’s above the threshold.
Did you know? IHT receipts have hit a record high of £5.2bn – data from HMRC shows a £400m year-on-year increase in the amount collected in 2017-18, an 8 per cent increase on the £4.8bn total for 2016-17. In March 2019, IHT receipts accounted for £537m, showing a growth of 44 per cent in a month. Analysis from Canada Life predicts that IHT receipts will reach £10bn per annum by 2030, almost double the current amount.
100% IHT relief EIS-qualifying investments are 100% exempt from IHT after being held for just two years. This is because EIS investments qualify for Business Property Relief after two years, which means they become exempt from the investor’s estate for IHT purposes. As a result, they provide a useful part of an investor’s IHT-mitigation strategy. And, with the addition of zero Capital Gains Tax, and 30% Income Tax relief, the benefits of EIS investments are hard to ignore.
Find out more at growthdeck.com/eis
PLEASE NOTE: To qualify for EIS/SEIS benefits, investors must be UK resident for tax purposes (or have UK tax liabilities) and subscribe cash for new shares in qualifying companies. Tax treatment is dependent on individual circumstances and may be subject to change.
Illustration Estate value
£500,000
Tax-free threshold
£325,000
EIS-qualifying investments
£250,000
Taxable amount
£0
Tax payable @ 40%
£0
our network – the entrepreneur
Rosie Whaley Rosie and father Jeremy launched Pi Pizzas in Winchester in 2014 and have since gone on to open a second successful restaurant in Battersea. Growthdeck investors raised £500k for Pi in 2018. Which colleague, mentor or employer has had the biggest influence on your approach to the restaurant business? y background was in fashion, I had no experience in M the restaurant industry, so I had to learn the hard way, but I’ve been fortunate enough to work with and gain knowledge from some great people who have joined the Pi team over the years. I have also found a friend in Kevin Bacon, the former managing director of Jamie Oliver’s restaurants. He’s been a constant source of positivity and support to me since opening a second Pi in Battersea. The biggest influence in my life and my approach to business is my dad, Jeremy Whaley. My fountain of knowledge and my absolute rock.
Why restaurants? Simply because I love everything about what a good restaurant should represent – amazing food, drink, and atmosphere where you get to spend precious time with friends and family.
Worst business decision?
Tell us something you wish you had been told at the start of your career?
Best business decision?
o always believe in myself, stick to my instinct, and only T work with good, honest, passionate people.
What’s your favourite restaurant or group of restaurants (besides your current one)? Kricket, Indian food is my favourite so I’m always dubious when chefs try a modern twist but Kricket have nailed it. The dishes are exciting and innovative but still packed with flavour and served in super cool, chilled spaces, I love it.
What motivates you? Success and happiness. Seeing the restaurants busy and buzzing with happy customers and a happy team is the best feeling. One does not happen without the other. I’m really lucky to have some amazing, genuine and talented people working with me which helps to make this all possible.
mploying the wrong people and believing they know E more than you. No one knows your business like you do, never doubt yourself.
At the very start of my venture I worked in the best pizzeria called ZeroZero pizzeria in Florence and without them I would never have known how to make the best pizza on the planet.
What piece of advice would you give to those looking to climb the rungs in the business? Keep your food, drinks and staff cost in line, but consistent quality is the absolute key to building your business. Never lose sight of that and hold onto the people that help you to achieve this.
If you could change one thing about the restaurant industry today, what would it be? The oversaturated current market and pending Brexit is making, and will continue to make, the industry a tough environment to find staff and source produce at a maintainable price point – for the foreseeable future at any rate.
This article originally appeared in Big Hospitality magazine March 2019 and is reproduced under licence.
Life through the lens Once a sleepy market characterised by the “older generation” and NHS frames, the eyewear industry has transformed and is experiencing phenomenal growth, with a 44% CAGR predicted by 2023. For those that didn’t see this coming, it’s time to polish off your spectacles as we take a look at the journey and future of an industry that has seen it all.
Looking back Eyewear wasn’t always the glitz and glam it is today. Prescription glasses were seen as a burden and sunglasses a luxury – the average person didn’t want one, and couldn’t afford the other. Contact lenses were almost unheard of, and laser eye surgery was something reserved for a Thursday night on Tomorrow’s World. However, it wasn’t all bad. Eyewear has typically been a very profitable industry, with a captured audience and markups of 100% not uncommon. It is, perhaps, no wonder that Mary Perkins – the co-founder of Specsavers – is Britain’s first self-made female billionaire.
20/20 vision These days, receiving a prescription isn’t the end of the world and buying a pair of sunglasses isn’t the end of your savings account. And what’s more, the eyewear industry is growing faster than ever before. So, what happened?
Requirements More people wear glasses. We’re living longer, spending more time staring at screens and have easier access to affordable eye tests. We have also become educated about the damaging effects of the sun and the health benefits of wearing sunglasses. It’s no longer uncommon for someone to wear glasses and, accordingly, more people are buying glasses and entering a lifetime of paying for updated lenses and frames. Popular culture Along the way, function and style have combined to make glasses a fashion accessory. Once strongly affiliated with a certain “intellectual” look, both glasses and sunglasses are now regularly seen on the catwalks, pushed by fashion blogs and endorsed by celebrities. Not only are more people buying glasses, but more people are investing in glasses as a fashion statement – one that, like clothes, many like to update regularly. Online The growth of eCommerce has also changed the eyewear game. Consumers can easily buy lenses and frames online, accessing a broader range of brands and styles than their local optometrist holds. Not only that but, with lower prices and easy returns, it’s becoming far more common to invest in multiple pairs to cover their inevitable loss down the back of the sofa.
Long-sighted Where is this all heading? The global eyewear industry is expected to increase from $123billion to $177billion by 2023 – that’s a lot of space for growth, which isn’t surprising when you look at what’s in store for the industry.
Subscription boxes
Style
eCommerce and technology
The UK subscription box market is expanding, with weekly and monthly deliveries of items ranging from food and makeup to razor blades and baking supplies. This is an interesting opportunity for eyewear brands, which can capitalise on wearers who like to update their style regularly. We’re already seeing early entries into this vertical, that offers an interesting way to increase customer lifetime value and secure regular spend.
Finally, style and function will become increasingly important and versatile. New materials will improve functionality, such as lightweight frames for athletes, infrared and ultraviolet-blocking lenses for highaltitude climbers, and light-stabilising technology for mountain bikers. Acrylic frames, like those used by Kirk & Kirk, will further expand the colours available – enabling outfit-matching purchases for both prescription and non-prescription glasses. And celebrity and influencer endorsements will continue to push sales and profits for luxury eyewear manufacturers.
eCommerce and technology can both transform and hinder the industry at the same time. Traditional optometrists and glasses brands that do not explore and exploit the opportunities of online sales and digital eye exams could be left behind, while brands that invest in online, fashion and wholesale sales could see tremendous growth over the coming years.
3D printing As the capabilities of 3D printing advances, so do the opportunities for the eyewear industry. Eyewear brands will be able to quickly produce fully customisable frames, with a tailored price tag attached. This will also make the production of glasses and lenses cheaper still – and so improve margins. Tech Technology will change the future of eyewear. Expect to see glasses that change focus at the touch of a button; online vision tests and augmented reality making buying and trying glasses online even easier; and smart glasses telling us everything from what direction to walk, to whether you need to head back for an umbrella. Like most tech, these functions will be expensive but highly alluring for consumers.
Niki Tibble Growthdeck Contributor
Rose-tinted glasses? Of course, there will be challenges along the way for the industry – ones that any interested investor should be mindful of. Fake brands Fake and imitation brands are issues that are unlikely to fully disappear. However, well-founded brands, built with quality materials, are more likely to survive, especially with celebrity endorsement pushing the “real thing”. Competition As the technology for eyewear develops, so does the technology for laser eye surgery. Becoming safer, easier and more affordable, the increased use of laser eye surgery denotes a decrease in prescription glasses wearers. This could be detrimental for eyewear brands focused on the need for glasses, but beneficial for brands focused on fashionable eyewear for prescription, non-prescription and sunglasses.
Once described as “medical appliances”, glasses have completed a u-turn, evolving into something sleek, smart and trend-setting, with fashion-conscious followers who like to complement their personalities through their choice of frames. The eyewear industry is certainly one to keep a close eye on as customers, popularity and technology are predicted to increase sales and profits.
Meet the Management Every business we raise money for has the chance to pitch to a select group of investors at one of our Meet the Management lunches. These are exclusively for registered Growthdeck investors and are held in a private dining room in Mayfair. Management teams present their business with supporting slides and videos, followed by questions from investors over a leisurely lunch.
Where:
34 Mayfair, Grosvenor Square, London
When:
Twice a month
Who:
One business and registered investors
Why:
Hear from the business, ask your questions and have a lovely lunch with like-minded investors and the Growthdeck team
Find out more at growthdeck.com/mtm
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I’ve always found the Meet the Management lunches hugely helpful in getting to know a business and asking the difficult questions.
John Davis Growthdeck Investor
our network – the expert
Hugh Clark Clarks Shoes is one of the UK’s largest privately-owned businesses. Its story began almost 200 years ago when Cyrus and James Clark made a slipper from sheepskin off-cuts. became Managing Director, bringing in new private equity owners, and grew the business through retail and particularly online. The business was later acquired in a trade sale. Hugh is currently Chairman of the Institute for Family Business, a membership organisation that supports and promotes UK family businesses through events, networking and advocacy.
At the time it was groundbreaking – a combination of invention and craftsmanship that has remained at the heart of what the business stands for. Clarks created the world’s first foot-shaped shoe and the company’s archives hold more than 22,000 different styles, including shoes that have sparked a revolution, defined a generation and captured the imagination. Even now, every pair of shoes begins with a last carved by hand from a single block of hornbeam. So, we’re naturally delighted that Hugh, a member of the Clark family, has joined as a member of our growing network and will be playing an active role in identifying and supporting our investee businesses. Hugh began his career at K Shoes (part of C & J Clark Ltd) as a graduate trainee. His first job was running a small stitching factory in Shap, Cumbria, making uppers for women’s shoes. He spent 11 years at Clarks, mostly in manufacturing, sourcing and in men’s range management. Later, Hugh re-joined Clarks as a nonexecutive director, spent many years on the board and chaired the remuneration committee. From there, he joined Rohan, an outdoor clothing company, with responsibility for its sourcing operations. Hugh stayed with the business after it was sold by Clarks and
Having joined the Growthdeck network, Hugh is already taking on a new role as Chairman of our fundraising business Kirk & Kirk, which designs and markets fashion-led eyewear. With his vast experience in the industry, Jason and Karen Kirk quickly saw the benefits of having Hugh on board. And Hugh is excited about the task ahead. “Kirk & Kirk is an ambitious, fast-growing business that has the potential to become a major player in the fashion accessories market, both in the UK and oveaseas. I’m looking forward to helping the Kirk family and their investors realise that ambition.” Needless to say, we’re looking forward to seeing the results of this network connection.
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Bringing the experience and expertise of someone like Hugh Clark to help Kirk & Kirk expand is what sets Growthdeck apart from other investors. We’re thrilled that he has agreed to advise the business as it looks to scale up rapidly.
Gary Robins Head of Business Development, Growthdeck
Supporting the next generation For the past two years we have been involved with Young Enterprise, the UK’s leading business and financial education charity for young people. Growthdeck works with the South Central chapter (Buckinghamshire, Berkshire, Oxfordshire, Bedfordshire and Hertfordshire), dedicated to providing excellent business education in schools, colleges and universities across the region. The Young Enterprise team deliver a variety of projects and events, from one-day employability workshops to year-long immersive programmes. One of the longer options is its Company Programme, which enables participants to experience what it’s like to set up and run a company. Running throughout one academic year, students make all the decisions about their enterprise, from deciding the name and product to creating a business plan and managing company finance. They also gain invaluable experience selling at events, such as the Young Enterprise Milton Keynes Trade Fair. This provides an opportunity for those participating in its Company Programme to showcase the products they have created – with everything from devices that monitor air pollution to educational dental kits to products for cyclists – and they are able to receive invaluable feedback from the public. Earlier this year, we sponsored the Best Overall Company category at the Milton Keynes event and were impressed by the winning team, Elevate, from Stratton Upper School in Biggleswade. The team produces high-calibre,
analogue clocks for children, that simultaneously aim to educate and spread awareness about the importance of wildlife conservation. The runners-up in the Best Overall Company category were team Kardaroo from Aylesbury Grammar School. Kardaroo makes innovative phone accessories which have a wide variety of uses and come in sleek, fashionable designs. As well as the trade fairs, we are proud to have played a role in Young Enterprise’s South Central Regional Final at the University of Buckingham, in terms of both judging and sponsorship. At this exciting event, students compete for a place at the National Finals – and we are looking forward to being involved again this year. Our CTO/CMO, James Wrighton, also recently selected Young Enterprise as his chosen charity when he ran the Milton Keynes Half Marathon, raising donations to support the South Central chapter. It’s a great pleasure being involved with Young Enterprise and supporting the work it does both in the local community and right across the UK. We are always highly impressed with the quality and enthusiasm of the students that we meet and it bodes well for the region that we have such exciting young entrepreneurs coming through. Growthdeck looks forward to continuing to play a small part in the development of local young entrepreneurs, helping to ensure that they have the life skills, knowledge and confidence they need to succeed in the changing world of work.
www.young-enterprise.org.uk
Get involved Invest in EIS opportunities We present regular tax-efficient investment opportunities to our network of investors. Take a look at the latest open offers.
www.growthdeck.com/invest Raise capital for your business Growthdeck helps exciting growth businesses raise capital from our network of investors. If you are looking to raise finance for your business, or know of a business that is seeking growth capital, please let us know.
www.growthdeck.com/raise Become a sector expert Growthdeck has a dedicated panel of industry experts, all with many years of experience in building and managing successful businesses. The panel covers multiple industry sectors and exists to help Growthdeck provide the best level of service to our investors and fundraising businesses. If you are interested in joining the panel, please visit:
www.growthdeck.com/experts Come to a Growthdeck event We host numerous networking events, from intimate Meet the Management lunches at our regular private dining room in Mayfair, to larger, more informal drinks evenings. It’s a great chance to meet other investors, fundraising businesses and, of course, the Growthdeck team itself.
www.growthdeck.com/events
Call us on 0800 302 9444 or email info@growthdeck.com
About Growthdeck provides tax-efficient and growth investment opportunities to an expanding network of sophisticated private investors, partners and introducers. We carry out professional due diligence, provide ongoing and extensive business support and develop a close relationship with our investors. We also regularly host networking events that help connect growth businesses with sophisticated investors from across the world.
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504-506 Elder House Elder Gate Milton Keynes MK9 1LR
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