Breaking the mould
Bill Roedy raised eyebrows with his unorthodox approach to business. But he scored a smash hit with MTV Networks International, which now boasts an audience of 2 billion. And, as if that wasn’t enough, he’s also taken the fight to the global AIDS epidemic
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CONTENTS Better Business Special 57 Doing it for themselves
Freelancing is proving an increasingly attractive option for many
62 Show me the money!
An employee pay rise request needn’t be stressful for an employer
64 Human resources 2.0
Martin Reed reflects on how the HR landscape has shifted since the 1980s
68 Christmas tech treats
We give the lowdown on this year’s best digital stocking-fillers
71 The next big thing?
3D printing is set to take the business world by storm
77 A month in the life
Tech columnist David Hathiramani was a busy bee in November
84 Franchise in the spotlight
“I developed a mantra, ‘doing good is good for business’, which I feel very strongly about to this day” Bill Roedy
VOLUME 02 ISSUE 12 / 2013 09 10 12 13 14 81 98
Editor’s letter Contributors News & events Talking point Book reviews Franchise news Start-up diaries
34 Eye on the exit
Thinking ahead from the outset can bring big rewards at the end
The new year is a chance to assess where things stand and set priorities
50 Use their imagination
27 As one voice
54 Digital battlegrounds
Make provisions for your business in case the worst happens
42 Talkin’ bout a resolution
23 One to watch
Why charity, government and business are uniting for the common good
91 Where there’s a will
It’s not all about the money when the time comes for investment
45 The hidden masses
Give as you Live adds a caring side to consumerism
40 Friends in high places
16 The Elite interview
There’s more than one string to the bow of former MTV boss Bill Roedy
Just Falafel is bringing tasty veggie food to the masses
Ethnic minorities remain an untapped market in the UK Capturing the hearts and minds of business associates can help no end Are price comparison sites as useful to brands as they are to customers?
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EDITOR’S letter VOLUME 02 ISSUE 12 / 2013
Scan this QR Code to register for Elite Business Magazine SALES Harrison Bloor – Account Manager firstname.lastname@example.org Adam Reynolds – Account Manager email@example.com Darren Smith – Account Manager firstname.lastname@example.org Jesse Hawkins – Account Manager email@example.com
Doing good is good for business
EDITORIAL Hannah Prevett – Editor firstname.lastname@example.org Josh Russell – Feature Writer email@example.com Adam Pescod – Feature Writer firstname.lastname@example.org Helene Stokes – Chief Sub-editor email@example.com DESIGN/PRODUCTION Leona Connor – Designer firstname.lastname@example.org Clare Bradbury – Designer email@example.com Dan Lecount – Web Development Manager firstname.lastname@example.org CIRCULATION Malcolm Coleman – Circulation Manager email@example.com ACCOUNTS Sally Stoker – Finance Manager firstname.lastname@example.org Colin Munday - Management Accountant email@example.com ADMINISTRATION Charlotte James – Administrator firstname.lastname@example.org DIRECTOR Scott English – Managing Director email@example.com Circulation/subscription UK £40, EUROPE £60, REST OF WORLD £95 Circulation enquiries: CE Media Limited Elite Business Magazine is published 12 times a year by CE Media Solutions Limited, Fortis House, 160 London Road, Barking, IG11 8BB Call: 0208 214 1068 Copyright 2013. All rights reserved No part of Elite Business may be reproduced, stored in a retrieval system or transmitted in any form or by any means, without the prior written consent of the editor. Elite Business magazine will make every effort to return picture material, but this is at the owner’s risk. Due to the nature of the printing process, images can be subject to a variation of up to 15 per cent, therefore CE Media Limited cannot be held responsible for such variation.
Roedy used his influence as CEO and president of MTV Networks International to benefit those less fortunate than himself
It’s that time of year again. December: the season to be jolly, to eat too much Christmas pud and quaff large quantities of your favourite tipple. Meanwhile, the retailers are donning their hard hats in preparation for battle and digital entrepreneurs are crossing their fingers that their websites will cope with peak demand. It’s also the season of goodwill. As we get stuck into our roast turkey dinners, unwrap gifts around the tree and watch the Queen’s Speech, most of us will spare a thought for those less fortunate than ourselves. Some of us will donate to children’s charities; others will volunteer at homeless shelters and soup kitchens. But there’s no reason why this more considerate behaviour needs to end when the Christmas decorations are packed away for another year. This month we are bringing you a Better Business special, dedicated to showcasing some of the companies and entrepreneurs that strive to make the world a better place – regardless of the calendar month. Bill Roedy, this month’s cover star, is as well known for his work in world health, and particularly in combating the global AIDS epidemic, as he is for his breathtaking business prowess. As a foil to the profiteering banking culture, Roedy used his influence as CEO and president of MTV Networks International to benefit those less fortunate than himself – not to add another zero to his bank balance. Roedy built MTV basically from scratch, and he ensured that being responsible was hard-wired into the company’s DNA from the get-go. Entrepreneurial royalty like him who believe in the greater good have inspired a generation of start-ups to follow in his wake - just look at Give as you Live, this month’s One to watch, which is sweeping the board in the awards stakes. And this month’s analysis highlights the benefits of collaboration between the third sector and for-profit entities. The motivation for businesses to behave better is irrelevant. Whether you’re doing it because you really believe it, for customers, for staff or purely for the benefit of your brand, it almost doesn’t matter. Just remember, as Roedy puts it: ‘doing good is good for business’.
HANNAH PREVETT EDITOR
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Emilie Sandy Sandy was a little bit out of breath when we phoned; not because she isn’t taking her entrance into motherhood in her stride but because she and her son Freddie were in the middle of strutting their stuff to 80s music, courtesy of Magic FM. When not educating her child in the ways of cheese, she’s doing things like snapping this month’s cover-star Bill Roedy. She confesses the former MTV boss’s house is pretty much a photographer’s dream location; all of her gorgeous shots of his mementos and objets d’arts almost do as fine a job of capturing Roedy’s character as the portraits themselves.
Leona Connor Connor is undeniably the ace up our sleeve, beavering away at all hours to design our magnificent mag. This year, for the first time in her life, she will be spending her Christmas in a strange, foreign land, away from her kith and kin in Ireland. Naturally we’ve told her about all of our customs: that the person selected for secret Santa has to buy gifts for the whole office, Christmas hats should have garish tassels and fancy plumage and traditionally bringing in mince pies is the prerogative of those lacking a UK passport. Her response, unfortunately, wouldn’t meet our editorial guidelines on decency.
Josh Russell 10
When he isn’t tooling around on trains in a tux like the Daniel Craig of the Greater Anglia transport system, Russell spends his time living the glamourous life of an enterprise journalist, judging Digital Business of the Year at the National Business Awards and attending conferences like NixonMcInnes’ Meaning 2013. However, like all good secret agents, Russell lives a double life – in his case, as a closet revolutionary. His passion for social enterprise, sustainable business and collaborative practices acted, in part, to influence our choice to release our Better Business December special.
Martin Reed We have some sad news this issue. After 18 months of producing his stellar columns for us, resident people expert Reed is hanging up his quill and parchment. On the upside, however, his final column for us is something of a humdinger: taking a look at the changes in HR over the three decades Thomas International has been operating, Reed tells us how enterprises are looking beyond mortarboards and skill-sets to the nuances of what makes a winning member of staff. No small irony coming from one of our strongest team members.
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29/11/2013 05/11/2013 21:47 12:13
NEWS & EVENTS
Nevertheless, professional HR body the
Chartered Institute of Personnel and Development (CIPD) has hit back,
Much attention has been given to zerohours contracts of late, the majority of which has been from critics of the controversial working arrangement.
WORDS: ADAM PESCOD
Forget about Christmas for a minute because the awards season is well and truly upon us. Last month, some of the UK’s best companies were recognised for their exploits throughout 2013; so far be it from us not to champion the winners. Kicking off with the National Business Awards, gongs were scooped by a host of mould-breaking firms, including the likes of student marketing pioneers The Beans Group – which won Digital Business of the Year – and cloud-hosting service UKFast, which was named Employer of the Year. Individual awards were also handed out, with Entrepreneur of the Year going to David Spencer-Percival, of energy recruitment firm Spencer Ogden, whilst Thomas Cook’s Harriet Green was named Leader of the Year. And as if that wasn’t enough, awards night attendees were also treated to a keynote speech by Sir Bob Geldof, who championed the role of business in society. Meanwhile, across London town, our most inventive and innovative of small businesses were being lauded at the Smarta 100 Awards. The big winner on the night was Give as you Live, the charity fundraising e-commerce platform which proudly fills our coveted One to watch slot this month. Not only did it pick it up the overall Business of the Year award for 2013, but it was also recognised for its substantial social impact. Other noteworthy winners included Ento Foods, netting Most Innovative Business for their aim to ‘introduce insects to the British diet’, and multi-platform soul and dance brand Mi-Soul, this year’s Startup of the Year. All eyes will certainly be on Give as you Live and the other Smarta 100 winners over the coming years.
claiming that the use of such contracts in the UK has been underestimated, oversimplified and unfairly demonised. A survey of more than 2,500 workers by the organisation revealed that those on zero-hours contracts were as satisfied as the average UK employee (60% v 59%), happier with their work-life balance (65% v 58%) and less likely to think they are treated unfairly by their company (27% v 29%). Yet, with 17% of zero-hours workers saying they are sometimes penalised when unavailable for work, it seems there are still some issues to be addressed.
Last but very much not least, the inaugural Great British Entrepreneur Awards also took place in November. As one would expect, the top brass from the British business arena were all in attendance, but it was former EB cover star Julie Deane who stole the show, going home with three awards under her arm. On top of being named Great British Entrepreneur 2013, the Cambridge Satchel Company founder also picked up the Export Entrepreneur and Manufacturing Entrepreneur awards in recognition of her brand’s popularity overseas and avid support of UK manufacturing. Elsewhere, founder of fresh-cut fruit and juices brand Blue Skies, Anthony Pile, was handed the title of Social Entrepreneur of the Year for his efforts in supporting struggling third world countries. It gave us great pleasure to hear about the launch of a new initiative from the good folks
UPCOMING EVENTS Business Scene Guildford Connections December 10 Regus, Cathedral Hill, Guildford, GU2 7YB
Business Junction Networking Lunch December 12
Jewel Covent Garden, 29-30 Maiden Lane, London, WC2E 7JS
at Prelude this month. Backed by the venerable Lord Young, enterprise adviser to the Prime Minister, the entrepreneur network’s Growth Britain scheme allows members of the public to put forward ideas and solutions that they believe will help drive the British enterprise landscape forward. Those responsible for the best suggestions will be invited to discuss their ideas further with Prelude founder Duncan Cheatle and Lord Young at Downing Street. We think that’s incentive enough. With the government continuing to bang the drum for exports, any further attempt to help stimulate SME trade overseas should come as little surprise. Nevertheless, a new drive to aid the UK’s creative companies’ overseas efforts struck a positive chord. UK Trade & Investment (UKTI) will throw its support behind a taskforce of the UK’s top 100 SMEs in the creative sector to try and win £500m worth of contracts in the next three years. With that target of 100,000 more companies exporting by 2020 still a long way off, this should hopefully be a step in the right direction. As the referendum on Scottish independence draws ever closer, the latest barometer of small businesses north of the border shows that remaining part of the UK is still the preferred option. According to research from the Forum of Private Business, three quarters of Scottish small firms said they would vote to maintain the status quo, with a further 49% saying they see independence as a threat to the country’s economic growth. However, 60% of firms feel that information is still severely lacking on the potential impact of independence in key areas. This one could go all the way to the wire.
ICAEW Information for Better Markets Conference December 16-17
Chartered Accountants Hall, One Moorgate Place, London, EC2R 6EA
Business Junction Christmas Networking and Social Evening December 18
The Langham, 1C Portland Place, London, W1B 1JA
Angels Den SpeedFunding Event January 8
Edwards Wildman, 69 Old Broad St, London, EC2M 1QS
SyncNorwich - Speech Technology, Machine Learning and Female Tech Founders January 14 Virgin Money Lounge, 10 Castle Meadow, Norwich, NR2 1PD
A full event listing is available on our website: elitebusinessmagazine.co.uk/events
Immediate relief? Are there ways in which business can help provide aid faster in response to humanitarian crises like the recent events in the Philippines?
WORDS: JOSH RUSSELL
here can be few people in the Western world who didn’t feel shaken at the recent crisis in the Philippines that emerged in the wake of Typhoon Haiyan. In total, the UN estimates the storm has affected 11 million people and left many of those homeless; the impact of the most powerful storm on record has been truly devastating and it’s impossible to see images of the area without feeling despair for the individuals whose lives have been irrevocably altered by this violent environmental disaster. Fortunately, the sheer volume of aid that has flooded in from all quarters has been truly humbling. Far from turning a blind eye, the world of business has stepped up to the plate: microenterprises right up to major corporations like Facebook have run campaigns to provide relief. But, sadly, Typhoon Haiyan forms just a small part of a wider contextual question. Given the fact that environmental and humanitarian disasters such as these seem, inevitably, set only to rise, it’s becoming increasingly important to question whether the mechanisms we as a community have in place to deal with these crises are sufficient, or whether we need to find ways to improve the preparedness of enterprise to assist with these problems. In short: are there ways we can improve the ability of business to promptly respond to international disasters?
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Angus Young Photography
Make sure relief is ready to roll
The growing clean-tech industry is now perfectly placed to help nations prone to natural disasters, but the technology needs to be matched to the localised crisis well in advance of need. From past experience, we Sandra Sassow know that sources of alternative power and CEO of SEaB access to food and fresh water are some of the Energy most urgent requirements following a violent storm that disables much of the disaster zone’s infrastructure and utilities. As a remedy, for example, our micro-power plants, which turn food and bio-waste into energy, are housed in shipping containers, making them ideal for transport into disaster zones, and can be ready to generate energy within hours of landing. Moreover, growing scientific evidence suggests that global warming will lead to more frequent extreme weather conditions across the globe. But although meteorologists were able to identify super-typhoon Haiyan days in advance of the storm hitting the Philippines, it took many days before aid reached some parts of the islands. There is an argument to support the idea of establishing localised hubs with fast-response teams that are on high alert prior to a major storm warning. Given the increased frequency of these storms perhaps there should also be a volunteer humanitarian world force. We have them for war, so why not for natural disasters? 13
Recognise our longerterm responsibilities With the seeming increase in these sorts of natural disasters in recent years, there is probably an element of the blasé about our view of what happens and of our involvement. Often, as individuals we are invited to Phil Wood contribute financially and some businesses Head of the Security may make a corporate effort. However, where and Resilience there is little benefit to organisations, why department at Buckinghamshire should they contribute time and resources to New University any kind of response or support? For me, it’s not only about social responsibility but it is also about being seen to be a contributor to the general good and our viability as an interlinked community. We as businesses and organisations are part of a wider and increasingly interconnected society, not only in terms of how we communicate but how we live. Japan in 2011 and the Philippines disaster indicate significant potential effect in terms of continuity, supply chain integrity and the wider effect upon business activity with resultant economic penalties and downsides. I don’t think that many organisations understand that helping to maintain the stability and economic viability of countries that are in trouble, and on which we depend, is an essential element of our wider responsibility not just to the global community but also to our own long-term societal and financial interests. Providing short bursts of financial support and making supportive noises will be less beneficial than considering how we can invest in the longevity of the wider global community. That requires more than a change in outlook: it necessitates an increasing understanding of how much we depend on each other societally and economically.
Talk Lean – Shorter Meetings. Quicker Results. Better Relations Alan H. Palmer
ffective communication is as essential to an entrepreneur’s success as it is to the relative success of one of their employees. In fact, good communication skills are a crucial part of everyday life. Full stop. Yet, it would be naïve indeed to assume that we have all got the art of communication down to a T. Many of us often struggle to say what we really want when the situation demands it. Whether down to lack of confidence or something more acute, the right words tend to elude us – and the wrong words slip out – on a regular basis. Privy to this very fact is Alan H. Palmer who, in Talk Lean, leaves absolutely no stone unturned in his quest to turn us all into communication whizzes. His book is based upon Philippe de Lapoyade’s The Incognitifs Discipline, which lays out some clearly defined guidelines on how to get the right result from a meeting, whether that be in one’s business or private life – albeit with a primary focus on the former. The intent is to send readers away safe in the knowledge that every meeting they have henceforth will be concluded both promptly and positively. And from perfecting the opening gambits to learning the knack of flawless listening, Talk Lean deserves to be the definitive text of its kind for years to come. AP
Talk Lean – Shorter Meetings. Quicker Results. Better Relations, published by Capstone, is out now and retails at £12.99
The Sustainable MBA – A business guide to sustainability, 2nd edition Giselle Weybrecht
ur vision of sustainability has shifted a great deal in the last two decades. Once being viewed as an act of philanthropy that would nevertheless harm a business’s bottom line, it has rapidly transitioned into something that many enterprises are not only using to maximise profits, but that is actually being built into a lot of organisations from the ground up. However, there is still many an individual unsure how to strategically incorporate sustainability. That’s why the need for a straightforward business manual on sustainability has never been greater. Weybrecht’s The Sustainable MBA is quite rightly becoming essential reading for any individual concerned with the future of business and its place in the modern world, being adopted as it has by some of the world’s leading business schools. Covering everything from the business case for sustainability, through the role entrepreneurialism has to play to how it can be enshrined in a variety of sectors, this text is more than just a mere strategic manual. As its title suggests, it’s an education in itself – it will take more than a single read-through to get to grips with the lessons it has to offer. It really is worth approaching as more of a long-term scholarship than a quick source of inspiration. Essentially, we’d recommend you take this book as the opportunity it is and make the most of it. Read it. Re-read it. Imbibe it. And make it a core part of the way you do business. JR The Sustainable MBA – A business guide to sustainability, 2nd edition, published by Wiley, is out now and retails £24.99
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â€œEven in my business philosophy, I encourage people to break the rules and be irreverentâ€?
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the elite INTERVIEW
A force for good Bill Roedy is famous for growing MTV International Networks across the world; taking it from a tiny London outpost to more than 200 countries and 2 billion viewers. But his campaign to fight AIDS worldwide is proving to be his biggest battle yet
hen Bill Roedy was poached from US television company HBO to move to London and lead a tiny new channel called MTV in Europe, he was already beginning to get itchy feet. “I was ready for a change – even though I had this wonderful life with HBO, splitting my time between LA and San Francisco and spending a lot of time in Hawaii,” Roedy recalls. Having become embroiled in industry politics, HBO’s global growth had stalled, whereas MTV was just a tiny start-up in need of a steady hand at its helm. Roedy provided that, and much more besides. In 2010, when Roedy was still in the driving seat, MTV Networks International was a business that had revenues in excess of $1.3bn – not including merchandise sales. But the glitz and glamour of TV was a far cry from Roedy’s humble beginnings. Born in Boston, he was raised in Miami by his mother, a single mother. “We didn’t have much,” Roedy says. “She worked as a rental car agent at the airport and there was no such thing as nannies or home care then so she would take me with her.” He jokes that it was this early exposure to airports that sparked an enduring passion for travel. His home, a converted church in North London, feels like a museum; a shrine to his travels with furniture, photographs, music and literature from faraway places in abundance. Roedy says his meagre beginnings also inspired him to work hard and strive for success. “I think when you have a humble background, you want to break out,” Roedy reflects. “I didn’t then know about the other world of success and private schools, or any of that stuff, but I knew instinctively that I wanted to break out. I
(H)Elite interview.indd 2
wouldn’t say that my childhood was unhappy, but when you’ve seen your mum struggle, just for basic things like having enough money for food, you want to do better.” The main source of happiness in the young Roedy’s household was the television. “Even with the hardship that we had I can remember we’d all be gathered around the television to watch these shows. Even though the family had a hard time during the week, on a Sunday night, we’d all be laughing. It just clicked, I suppose, even subconsciously, that the television could bring happiness and lift the spirits.” However, it was years until Roedy found that his future lay in TV. After school, he followed in his father’s footsteps and headed off to West Point, a military academy in the state of New York. It was something of a shock to the system, he admits. “I had lived a very free life and I wasn’t used to the discipline, so I rebelled. But I learned over time, too slowly perhaps, to navigate the discipline. This meant not fighting it, but going around it. Initially though I was always getting into trouble.” Roedy credits his time at West Point and the subsequent years he served in the military with laying the foundations for some of his stellar business principles. “Even in my business philosophy, I encourage people to break the rules and be irreverent. At MTV, I tried to instill the culture of don’t accept no for an answer and keep fighting. I think that’s a key success factor, particularly in an entertainment business.” Having left West Point just before his twenty-second birthday, Roedy was sent to Vietnam, where he became a second lieutenant. And his military career didn’t end there. After the war, he commanded three NATO nuclear missile bases in Italy. Roedy says having such huge responsibility in his twenties taught him to remain calm under pressure. “It teaches you perspective,” he says. “It’s hard to take things like secrets in business seriously when you’ve dealt with the codes which release nuclear
the elite INTERVIEW
weapons. When I went to Harvard Business School everyone was saying ‘it’s too much pressure’, but for me, it wasn’t that much.” Upon returning from Italy, Roedy chose to attend the prestigious business school to do his MBA as a segue into a business career. His earlier musings about the power of TV resurfaced and working in the media seemed an appropriate foil to the intensity of his young military career. “When you work in public service, you dedicate your life. You’re working long hours to serve your country. I think after that I was ready to work in something that’s a little bit lighter, perhaps.” During the programme, Roedy got a taster of working in TV by completing an internship at a small station to improve his chances of success in the media industry. “I knew I wanted to go into media, but no one would hire anyone with my background immediately. It was just too foreign.” This gave Roedy the boost he needed: upon graduation he was offered a job working for HBO. There, he ascended the ranks quickly. He gained a reputation as a deal-maker and worked tirelessly to boost HBO’s distribution throughout the United States. One of his biggest deals was with TCI, owned by John Malone, who now owns Liberty Global, the world’s largest cable company. The long-term deal between TCI and HBO was signed on the basis that Roedy attended every single launch, of which there were three a month, often in tiny towns and cities throughout the US. Roedy’s criss-crossing earned him the moniker ‘Roadman’ amongst colleagues. Having moved to LA to head up sales and
“I knew I wanted to go into media, but no one would hire anyone with my background immediately. It was just too foreign” distribution at the San Francisco office, Roedy was leading a comfortable life when MTV came knocking. But his entrepreneurial sense of adventure meant he accepted and moved to London to take the reins. “MTV had just set up a very tiny office in London, I was at the right age where I was ready to make a change, and it just intrigued me that we could make this into a global brand. So I started this entrepreneurial gig. It was a great ride.” Roedy’s focus was on European expansion for the first three years, then he set his sights further afield, taking MTV to the world. Early
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BUSINESS ACCORDING TO BILL – Be adaptable – Never take no for an answer – Break the rules. Be irreverent – You learn more from failure than success – Have fun. Friends and family will be with you longer than a job – Doing good is good for business – Travel is a cheap education with no homework
on, he developed his famous mantra, ‘respect and reflect’. For he developed a distribution model that was something of an alien concept in the 1980s. Rather than rolling out the same product, the same channels, to every geography, he would set up each station as its own business unit, with local staff, showing local artists and so on. “It’s not one cola and one burger,” says Roedy. “If you have one cola around the world, you have great scale. Likewise, if you have one television channel it’s the same. But then you start bumping up against not only language difference, but also cultural differences. So fast forward, MTV then evolved into many different types of brands and products, and we did the same thing for our other channels. We even had local brands that were completely different: Viva was a local brand that started in Germany, TMF, the music factory, started in Holland.” The new concept raised some eyebrows in the media and business worlds. “It’s more expensive because you have to customise, and also you lose the scale of being big. But I thought it was
the only sustainable way forward – particularly in something so culturally important as television. The idea of having creative teams on the ground everywhere and actually designing a product that’s much different was quite radical at the time,” he explains. No market was off limits for Roedy. He took MTV behind the Iron Curtain and struck a deal to broadcast MTV in China. “In China they were very intent on the world knowing what their culture was like, so we got the US operation to distribute their CCTV-9 channel in hotels across the States, and in exchange for that, we were able to start a Mandarin MTV channel in China. In the end, everything’s negotiable,” he laughs. He may well be right. Roedy also did a deal with the Mayor of Mecca in Saudi Arabia that there would be a call to prayer on the channel five times a day in exchange for distribution. But, despite all of this intrepid deal-making, Roedy says the most challenging geography by a country mile was Canada. “They wouldn’t let us in,” he exclaims. “As Canada is so close to the
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US, geographically and culturally, they are always exposed to the TV culture of the US and they felt very strongly that musically they had to to develop their own market. They had a homegrown brand called Much Music,” explains Roedy. MTV eventually made its mark on Canada, but it wasn’t a fully fledged operation until 2006. Roedy concedes that he may have taken the decentralised model for which he is famous too far. “Towards the end I think I counted 35 different award shows around the world, including MTV and Nickelodeon. They’re great shows because they bring in clients and they’re marketing machines, but we were so decentralised, there’d be 35 calls to the same artist, which was frankly just ridiculous, not to mention unsustainable.” The pendulum has swung in the opposite direction since his departure, says Roedy. “I was just so passionate about having these products reflect local cultures... But now there’s a swing to bring it back to something that’s scalable. So the look of MTV now is the same all around the world. Shows tend to be formats of successful shows that have been hits, particularly in the US or the UK.” Another central tenet to Roedy’s work has been sustainability. He was considering how businesses could operate more ethically light years before CSR made it onto board agendas everywhere. “I developed a mantra, ‘doing good is good for business’, which I feel very strongly about to this day,” he says. According to Roedy, there are four very good reasons businesses need to be concerned with wider issues. “If you’re a business you want to do good because it’s the right thing to do, but also because of your customers. If you put Coca Cola into Africa, you
want more customers, so you want people to be protected from the AIDS virus. Also, you do it for your employees, because they feel better about coming to work and are more productive. If they don’t believe in any of those, and many businesses don’t, then do it for your brand.” MTV was one of the founding members of an entity called the Global Business Coalition, with Roedy its chairman. “We worked so hard at aggregating the business response to AIDS, to begin with, then we added malaria and TB, and then over time all health, including diabetes.” As companies have increasingly developed their own CSR initiatives, the GBC is now being scaled down. “We put ourselves out of business,” Roedy jokes. Since leaving MTV Networks International as chairman and chief executive in 2011, Roedy has dedicated the vast majority of his time to
“I developed a mantra, ‘doing good is good for business’, which I feel very strongly about to this day”
continuing the work he began at MTV on global health. Although his repertoire has also expanded to work on initiatives battling other diseases, he has become a world authority on HIV and AIDS. And in 2005, UN secretary general Kofi Annan appointed him founding chair of the Global Media AIDS Initiative Leadership Committee. He has also worked with the Global Alliance for Vaccinations and Immunizations (GAVI), founded by Bill and Melinda Gates, since 2010. “Five and a half million lives were saved in the first ten years, and 370 million children were vaccinated. In the next four years, a quarter of a billion children will be vaccinated and 4 million lives saved,” he says matter-of-factly. He also remains chair of the Staying Alive Foundation, which he started at MTV, is on the board of amfAR, another AIDS organisation, and has just been asked by Goldie Hawn to join the board of an education charity. And that’s not all: Roedy soon decided it was time to get back to business. His interests now include a spot on the board of Moshi Monsters (founder, Michael Acton Smith, was our very first cover star back in August 2012), Zumba, Ping4 and private equity advisory boards of TowerBrook and ClearVue. Is it good to be back in the saddle? “Yes, I’m thrilled to be back. I love the entrepreneurial world. Nothing’s more exciting. Nothing’s more intense,” he says. Bold words coming from a Vietnam vet who’s rubbed shoulders with everyone from Kylie Minogue to Fidel Castro. There are certainly no plans for this man to take up his pipe and slippers just yet: “Retirement is a dirty word,” he jokes. “Next question.” Roedy has many mantras and clues to business success, which he tries to disseminate amongst the entrepreneurs he advises. Number one on the list is adapt or die. He explains: “This is important now more than ever, because the world changes so quickly. Time is compressed.” “When I graduated from college, everything that defined my life didn’t exist. The emerging markets, the BRICS, did not exist. The AIDS epidemic did not exist. Cable TV largely did not exist. HBO did not exist. MTV did not exist. Google, the internet, none of that stuff existed. It intrigues me that everything that has defined my life really came about after I became an adult. I think you can take that by a factor of at least ten now because things develop so much more quickly.” Which leads Roedy to a conclusion. “In order to thrive in this world, you need to be adaptable. I quote Darwin: ‘It’s not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change.’ That’s the key to success.” To read more about Bill Roedy’s approach to business, pick up his book What Makes Business Rock, published in May 2011, by Wiley.
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Fresh from netting two awards at the Smarta 100, Give as you Live is proof that commercial success and a social conscience are anything but incompatible
Hand in hand WORDS: JOSH RUSSELL
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t’s evident attitudes towards businesses with social goals are changing. A decade ago, it may have seemed unlikely that a business whose primary aim was to raise money for charities would be scooping up awards left, right and centre. But innovative business Give as you Live, the service that enables consumers shopping online to raise money for charity at no additional cost to themselves, is netting no end of accolades, proving that success doesn’t have to be paid for in cynicism. Founder Polly Gowers feels that that making an impact in the business world and improving the lot of others go hand in hand. “To get on in life, you have to help others,” she says. “Something that Bob Geldof said at the National Business Awards was ‘it’s all very well everyone being sat here because they’re running good businesses but what are
you doing for society?’” she recalls. “It’s true: business has to be responsible.” Gowers has always felt a responsibility to help other people. During her late adolescence, she was even offered a place at medical school, something she eventually chose to turn down. Despite the dismay that met her decision, she has no doubts that it was the right choice to make. “I’d have made a lousy doctor,” Gowers admits. However, she’s not unaware of the irony that both her potential and her actual career are built around providing aid for those who need it. She says: “Maybe, in a funny way, I just found a different way to help people.” Instead Gowers decided to focus on a different area of her life: racing and jumping horses at a competitive level. However, despite competing at national and international level, netting her fair share of golds and running a training business producing horses that
“To get on in life, you have to help others” Polly Gowers, Give as you Live
ONE TO WATCH
Company CV Name: Give as you Live Founded by: Polly Gowers Founded in: 2010 Team: 20
galloped their way onto the Olympics, she found something was missing. “I’d been very privileged to ride some lovely horses and won some great prizes but I didn’t want to have to do that for a living anymore,” she comments. A change in profession is hard enough at the best of times but, when you’ve skipped the standard career ladder, it becomes truly daunting. However, Gowers wasn’t lacking strings to her bow, being very computer literate, as well as having experience of selling and running her own enterprise. She breezed her way into a role at a web design business that had been looking for sales people. “I spent 18 months selling websites,” she says. “After that I really thought ‘I want to do this myself’ and started my own small consultancy from the shed in my garden.” And, whilst she didn’t know it then, this would lead her to a fundamental realisation. “I never built websites myself; I always used external contractors,” Gowers explains. “But I was the consultant that helped people work out what they needed to do on the web.” Working with high profile clients like Mars gave her key insight into the industry – increasingly affiliate and search marketing were coming into play and ultimately this meant one thing. “We were increasingly seeing commission beginning to
“I jokingly said something like ‘why can’t we use this commission to raise money for charity?’” dominate the internet,” she recalls. Almost in direct parallel, charitable organisations have seen their ability to access funding become rapidly restricted. “To be perfectly honest, the way we give is a long way behind the way we live at the moment,” she says. Whilst many of these charities may be feeling that they just aren’t attracting the younger generation, Gowers believes it’s not down to a lack of passion amongst young people. There is simply a disconnect between the way later generations are living their lives and the traditional channels charity relies upon. “I’ve got three daughters and the way they consume media is totally different from the way I consume it,” she comments. “They’re living a very different life from us.” Often it seems some of the best ideas arrive in serendipitous ways and perhaps Gowers would never have realised the potential if she hadn’t been discussing this glut of funding in the tech space with colleague Julia Felton, who also happened to be a volunteer fundraiser. “I jokingly said something like ‘why can’t we use
(H)One to watch - Hand in hand.indd 2
ONE TO WATCH
this commission to raise money for charity?’” she says. Irony rapidly gave way to inspiration and the pair realised they’d hit upon a very meaningful opportunity. “We wrote a business plan down and the more you looked at it the more you thought ‘why not?’” Gowers explains. Quickly they found other people who were willing to throw their all behind the idea. “We were fortunate enough to have some very brave and maybe foolish friends and family that got us that starting bit and from there it snowballed,” she says. They set a line in the sand they needed to reach and, by the time they had reached half of their target, such was Gowers’ faith in the project that she put her house on the line. “The bank were very brave and secured the overdraft against my house,” she says. With this funding in hand, the partners were able to hire some talented coders to start building the solution and have never looked back. Since then, the rapid growth that Give as you Live has managed to secure has been down to how it has reinterpreted an existing mechanism – affiliate marketing,
in which retailers pay a small commission for referred customers – to rapidly form relationships with some of the UK’s biggest retailers. The enterprise gets a small payment for delivering a whole host of new customers, on the proviso that the online retailers donate a part of the subsequent profit to charity. “The retailers are all working with us because we deliver them a customer,” explains Gowers. But perhaps more important than its relationship with retailers is the unique impact the enterprise has had on the causes it serves, truly democratising the relationship between commerce and charity. Not Polly Gowers, only can a customer raise money for charity when shopping but they Founder, Give as you can raise money for the cause that they care about most. “We are totally Live agnostic,” Gowers says. “What is really exciting is we can give a local school a relationship with Waitrose, Tesco or Amazon – brands they’d never get to work with otherwise.” Since its inception, Give as you Live has succeeded in raising an astonishing amount for these causes, generating more than £4m for its portfolio of 200,000 UK charities. Unsurprisingly, this has attracted a significant degree of recognition for both the enterprise and Gowers personally – just last year she was awarded an OBE for her work. “I’m very humbled by that,” she says. “But at the end of the day what we’ve achieved is only as the result of having a great team.” And the industry is now falling over itself to reward that team for its work. Give as you Live received nominations this year for both the National Business Awards and the Smarta 100; a rather awkward situation as both ceremonies were scheduled for the same night. Gowers was already booked up for a table at the National Business Awards when her contact at Smarta hinted that there might be a good reason to come along to the ceremony. “She said, ‘you’ve got to be there: I’m booking a car’,” relates Gowers. The entrepreneur was bundled into the waiting vehicle to travel across town, where she and the team were awarded with both the Grand Prize and Biggest Social Impact. “It was a good week,” she smiles. In light of the fact it has enjoyed no small amount of success already, it’s hard to see how Give as you Live can improve on its offering but Gowers has much bigger plans in the offing. “The big switch that I want to see is that we work with brands because they see the worth of contributing social value for customers, in and of itself,” she says. This is how Gowers views the role of Give as you Live and others like it: they are holding the door open for those that follow. She predicts the future will see a significant interest in contributing social value in business and compares it to the recent boom in sustainability. “Whether you’re BT, whether you’re British Gas, whether you’re a little tiny company, your social credentials should become just as important as sustainability to your bottom line,” she says. If we ever needed convincing that business can be good for society, it’s fair to say that companies like Give as you Live should act as our proof of concept. Gowers agrees that change is imminent and maintains enterprises like Give as you Live are part of the vanguard of a whole new way of conducting business. Addressing the issue with characteristic conviction, she concludes: “Help me tell the world: it works.”
“Your social credentials should become just as important as sustainability to your bottom line”
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Survival for any organisation in the modern world is not down to how it competes or sets itself apart – it’s about how it works with others
WORDS: JOSH RUSSELL
(H)Analysis - Come together.indd 1
he way organisations have begun to see has incredible insight, resources, leadership their relationships with each other has capabilities and we need all of that deployed to shifted radically in recent years. Sectors help create this more sustainable world.” that were once poles apart like business and A change in attitude this significant doesn’t charity now feel a great deal of attraction, just come from one single cause, though. First realising that when they come together of all, the way the public have taken to their power will be stronger. It’s a technological advances has forced everyday stark contrast to the darker days of organisations – not just tech giants like hostility between organisations. Facebook or Google – to shift their approach to “When I started out, in the 1970s, keep up. Whether we’re looking at social charity never talked to business,” says media, viral content or the way they consume Jonathon Porritt, founder and director of media, for the first time, individuals have a say Forum for the Future – a non-profit in setting the agenda. Anne-Marie Huby, organisation working globally with business co-founder of fundraising platform JustGiving, and government to create a sustainable future says: “These things together are creating a – as well as former chair of the Green Party different landscape to which charities, and director of Friends of businesses and even the Earth. “Most of the governments have “Business has incredible time environmental to adapt.” organisations were But it’s not just the insight, resources, pointing the finger of positive effects that are leadership capabilities and driving a new blame at businesses for we need all of that deployed collaborative agenda. being the wicked despoilers of the Despite purported to help create this more environment.” recovery, you don’t have to sustainable world” It’s hard to pinpoint an look far to identify the exact time when thoughts lingering effects of Jonathon Porritt, Forum for the Future toward competition as the recession and austerity ideal state for business changed. Porritt feels with many an organisation still feeling the the United Nations Conference on pinch. These institutions must adopt a degree Environment and Development in Rio de of radicalism if they want to survive. Janeiro began, way back in 1992, to highlight “Shrinking resources mean that collaboration the fact that working together could prove is absolutely essential to find solutions to more effective than arguing amongst problems,” says Michelle Wright, chief themselves. “There was no point in having this executive of social strategy agency Cause4. endless war of attrition,” Porritt says. “Business General belt-tightening hasn’t been the only
Pimp My Cause The Agency of the Future
between relevant parties can help them deal with a volatility that would otherwise be hard to deal with. “Whole markets can go down suddenly, with huge discontinuities for the business, and they’re also on the receiving end of rising expectations from consumers,” says Porritt. Fortunately, with an openness of conversation, organisations and enterprises can widen their oversight and are able to make smarter overall decisions. “They know what their suppliers are saying and what their business partners are thinking,” Porritt explains. “So what they’re able to do then is to marshal those insights collectively.” But the beauty of this approach is more about how it can facilitate greater efficiencies. “There is a lot of really smart innovation going on,” comments Patrick Nash, chief executive of the digital service provider for charities and social enterprises, Connect Assist. His firm is currently engaged in some open conversations with parties across a range of sectors. “We’ve got a large corporate, a large government department and us – a medium-sized social enterprise – meeting together and talking about how, in collaboration, we’re able to do the job better.” And this manner of thinking is becoming more deeply embedded in the fundamental ways start-ups behave in the wider market. “Technology enables us to open up for external consumption assets that we’ve built ourselves,” says Huby. Using application programmer interfaces (APIs) – that allow programmers access to basic code of solutions like JustGiving and to build integrated apps and services – has opened up relationships between the enterprise and around 1,000 developers,
“Shrinking resources mean that collaboration is absolutely essential to find solutions to problems” Michelle Wright, Cause4
product of our recent economic turbulence though: it has also drawn people to enquire how fit for purpose these competitive mechanisms really are. “What’s happened with the crisis in the financial sector has shed a light on how business is conducted in the mainstream,” says Huby. “It’s created an appetite for more meaningful businesses.” More simply though, there has been something of a general mood change over the last few decades; Paul Skinner, co-founder of collaborative and social marketing agency Agency of the Future, feels this can even be detected in the change of cultural touchpoints. “Contrast Michael Jackson’s ‘I’m bad’ slogan with Barack Obama’s first election under the slogan: ‘yes, we can’,” he says. Comparing other 20th century mainstays with their modern equivalents – Encyclopaedia Britannica with Wikipedia, the Beeb with YouTube – show the extent to which organisations have come to rely on a collaborative mindset. This lends a fair amount of weight to Skinner’s statement: “We live in a time of reinvention.” Evidently then, there are plenty of organisations and individuals seeking new ways of approaching the issues they’re facing. And there’s evidence that collaboration
(H)Analysis - Come together.indd 2
If Agency of the Future is designed to champion new collaborative models of marketing, its spin-off project Pimp My Cause could be considered proof of concept. Bringing social enterprise and causes together with marketeers willing to give them advice free of charge, the not-for-profit helps reintroduce a little soul into the world of marketing. Skinner explains: “Pimp My Cause works rather like online dating, but gives professional marketeers charities and social enterprises to fall in love with, rather than people.” The level of success and quality of partnerships it is garnering demonstrates its work is about far more than just giving people a warm fuzzy. “We now support over 800 charities and social enterprises,” says Skinner. “We’ve contributed several million pounds of social value.” It has accrued high profile ambassadors – including Rory Sutherland, vice-chairman of Ogilvy, and Sir Tom Shebbeare, head of Virgin Giving Money – as well as forming key strategic relationships with respected industry bodies the Chartered Institute of Marketing and the Marketing Society. And the transformative effect the organisation is having in changing attitudes in marketing shouldn’t be underestimated; the world – regardless of sector – seems to be ravenous for the sort of value it is offering. “We’re now meeting with corporates who are interested in having marketing and brand teams competing with each other and seeing who can develop the best marketing initiatives for our causes, there are some opportunities with government and we’re even in talks with the head of a television company who’s interested in making Pimp My Cause Challenge: The Series.”
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generating mutual value for both parties. She comments, “it’s a cultural shift: the desire to join forces as opposed to competing.” This touches on something fundamental. Whether using APIs, creating joint ventures or curating discussions, the real importance of collaboration is how it transforms the pool of resources an organisation has at its disposal and, regardless of whether its goals are financial or social in nature, this can only be considered a positive thing. “The traditional competitive model behind organisations depended upon enclosed resources,” says Skinner. Essentially, a company would amass resources like intellectual property and skilled staff and ring-fence them aggressively. This was all well and good but it meant what could be achieved was inevitably limited by the size of the company and the fight to internalise and secure assets often left the unsavoury tang of slightly unethical practices, tarnishing public perception of the brands involved. “One of the implications of moving to collaborative rather than competitive advantage is that you’re no longer limited by your internal resources, you’re no longer limited by how big you are,” Skinner explains. “There’s a whole world of resources out there that, with the right ideas, you can access.” A prime example of the success of this approach comes from the work of Roy Sandbach, Skinner’s co-founder at the Agency of the Future. His former role as R&D research fellow at Procter & Gamble entailed working on the corporation’s Connect and Develop programme, an initiative set into motion by CEO A.G. Lafley. “He had essentially observed that they had 7,000 - 8,000 research scientists at Procter & Gamble but there were perhaps 2 million people in the world working on issues that were relevant to their business,” says Skinner. Making the most of this resource required opening P&G up to a more collaborative mindset, engaging rewarding staff and partner behaviour that acted in the common interest; something that has had huge ramifications for the company. “That programme made a significant contribution over that period, nearly doubling the size of what is one of the largest organisations in the world.” This isn’t the only evidence that collaboration doesn’t just serve the interests of charities or small business. Forum for the Future was set up to facilitate conversations not just between causes, corporations and NGO, but, within industries themselves, amongst stakeholders who may have once viewed each other as a threat. “We’ve been lucky enough to work with some of the world’s leading companies on these sustainability challenges,” says Porritt. An example he gives is the work they have
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been conducting with the shipping industry and significant stakeholders within it, including importers and financiers. Supporting the dialogue to represent these parties’ needs, Forum for the Future has helped represent the interests of those involved and has assisted in the creation of a more equitable and sustainable solution for all involved. Porritt comments: “It’s been a really exciting journey for us, not to say ‘this is how you’re going to do it’ but to work alongside those very senior people inside the industry and ask ‘how can we make this work?’” And it’s not just corporates who are wising up to the mutual value that more collaborative approach can have for society, as Nash explains. “There are some other great parts of the public sector that are really getting that, actually, if they engage with small business, if they engage with social enterprise, if they engage with charities, they can probably get a better value product, better value service and get the kind of flexibility that they struggle to get elsewhere,” he says. “There is a direction of travel here and it’s a positive one.” But how can such radically different organisations benefit by coming
“It’s a cultural shift: the desire to join forces as opposed to competing” Anne-Marie Huby, JustGiving
Think Big Telefonica O2
If you needed evidence that even high profile corporates are interested in harnessing the huge power of collaboration to create mutual value, look no further than Telefonica O2’s Think Big programme. Itself borne from open, honest dialogues, Think Big came from Telefonica O2’s interest in the social causes its staff and customers wanted it to address. “Young people came back as the number one priority,” explains Simon Miller, the corporation’s deputy head of public affairs. Focusing on encouraging and supporting social action in those aged 13 - 25, Think Big provides tiers of funding – from £300 up to (a soon to be launched) £10,000 – to help youngsters implement and scale meaningful social projects. “These are hugely diverse in nature,” says Miller. “They often stem from the personal story and interests of the individuals concerned.” All very admirable but why does supporting youth action matter so much to those at Telefonica O2? “Young people
are 20% of the population but 100% of our future,” explains Miller. The huge benefits of social action for young people also shouldn’t be underestimated, building qualities valuable to modern business such as confidence, teamwork and responsibility toward others, as well as addressing factors important to all manner of organisations and individuals. He continues: “If there is a generation that is disenfranchised, disengaged and not realising their potential, we will all pay a big price for that, in both social and economic terms.” Telefonica O2 also recently took part in Step up to Serve, the cross-sector initiative encouraging youth involvement in social action. Miller believes it is down to the significance of the cause that even David Cameron, Ed Milliband, Nick Clegg set aside their differences to ally on the subject. “It got them all united in an apolitical way, plus a lot of businesses, plus a lot of faith groups, and people from the third sector,” he explains. “This is happening because if we don’t give young people the support and opportunities they need to reach their potential and develop everyone will suffer.”
together? “Quite often when people talk about an organisation is for-profit doesn’t mean there aren’t significant values collaborating, they will suggest that you embedded in its agenda and it’s perfectly possible for charities to collaborate with very similar organisations functionally drift away from their original goals. “It’s down to the culture and, of course, that’s probably not the best part of the organisation.” of collaboration,” says Skinner. Diversity of Perhaps a deeper reason for this suspicion amongst the public toward the attitude and structure can actually be a huge social aims of enterprise and charities is that, traditionally, a lot of this boon, bringing in radically different ways of work hasn’t actively engaged them and, moreover, there has often been a addressing problems into the pot and degree of opacity about how funds are employed. People are supposed to preventing the factionalism or oneupmanship vote with their feet; rarely do they feel like they are more intimately caused by rivalling interests. He explains: involved in the process. “Quite often it’s unlikely bedfellows that lead Fortunately, this boundary is also eroding. Given the huge power social to the best kinds of collaboration.” media and crowd initiatives have wielded to change and influence the world There are some who would argue, however, for the better, many organisations are recognising that people have a desire that this model of collaboration is to act directly. fundamentally flawed; that the structure of Announced at NixonMcInnes’s conference for progressive business business only tolerates short-termist Meaning 2013, Yimby – or ‘yes in my back yard’ – is the latest product approaches that will maximise shareholder from JustGiving and is set to give the public agency in their own value. However, most parties, regardless of communities. Utilising the power of crowdfunding, Yimby will enable sector, reject this unequivocally. ground-level social activists to change small things for the better within “It’s a stereotype and, as such, cannot really their own communities. “It’s to give people the chance to change something be trusted,” remarks Nash. He feels that more near them,” says Huby. “It’s the kind of stuff that happens for charities on and more enterprises are recognising they need JustGiving all the time and it will be just fantastic to see that happen for to invest the overall health of the market: local projects.” without that their own life expectancy is And this is the vital last piece of the collaborative puzzle. Whilst limited. And this means investing in the other individuals and organisations have achieved remarkable things in isolation, factors upon which one’s market depends. the huge economic and social value that can be created when this energy “Contributing to a sustainable market is the and insight is shared cannot be overlooked. For those that want to address same, in my view, as contributing to the common problems facing the world of business, charity, governance sustainable society, a sustainable environment and the world at large, it’s important to recognise how much more we can and a sustainable economy.” achieve when we pull in the same direction. Unfortunately, there is still “The potential for collaboration to be a degree of cynicism about a force for a better economy, for a business’s involvement in this better society, is vast,” summarises sort of area but it’s important Skinner. “If you look at the big issues to see that this attitude is facing the world today, from climate limiting. Cause4’s Wright change to youth unemployment, there mentions a recent interview is no one person or organisation that she was involved in regarding can solve any of those challenges. They the Goldman Sachs 10,000 will all depend on us coming together.” Small Businesses programme, Paul Skinner, Agency of the Future in which the journalist focused heavily on the corporation’s intentions. But her response is that just a handful of the small businesses they support will become significant parts of the Goldman Sachs portfolio – instead the corporation is recognising enterprises like Cause4 are important for the health of the overall economy on which it depends. “The view of Goldman Sachs is that the start-up community is essential to business growth and, if we have a stronger UK economy, it helps us all.” It is becoming increasingly important to recognise that binary views of a separation existing between commercial success and social value are inherently unsound. “The values-driven organisations who actually want to make a positive difference to society exist in all three sectors,” comments Nash. The fact that
“Quite often it’s unlikely bedfellows that lead to the best kinds of collaboration”
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Rt Hon Michael Portillo
Broadcaster and former cabinet minister
Other conference guests include: Charlie Mullins, founder, Pimlico Plumbers; Andrew McCartney, CEO, Microsoft Ventures; Chris Dawson, founder, The Range; Renaud Visage, CTO & co-founder, Eventbrite; Carl-Olav Scheible, EVP, MoneyGram International; Duncan Cheatle, founder, Prelude Group; David Taylor, co-founder & director, First Point Group; Divinia Knowles, COO, Mind Candy; Clare Rayner, The Retail Champion; Colin Stanbridge, CEO, London Chamber of Commerce; Guy Rigby, head of entrepreneurship, Smith & Williamson; Craig Donaldson, CEO, Metro Bank; Crispin Simon, managing director of trade development and strategic trade, UKTI
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national conference & exhibition 10-11 April 2014
The Old Truman Brewery Shoreditch, London
Keynotes, Seminars, NETWORKING
Two days. 200 exhibitors. 60 keynote seminars by professional speakers
Founder, King of Shaves
Covering growth, sustainability, finance, technology, sales & marketing, law, accounting, hr & international expansion Obviously there’s a lot more to our event than top quality talks and diverse discussion. Getting a chance to meet and mix with fellow SMEs is core to our event’s culture and the Exhibition will feature no end of exhibitors, workshops, seminars and activities for you to sink your teeth into.
chairman, Institute of Directors
Michelle Mone OBE Founder, Ultimo Brands International
Click here to register now or go to www.elitebusinessevent.co.uk *eligibility criteria apply Confirmed keynote seminar speakers are: Mark Artus, CEO, 1HQ; Mike Mindel, CEO & co-founder, Wordtracker; James McMaster, co-managing director, Ella’s Kitchen Europe; Renaud Visage, CTO & co-founder, Eventbrite; Darren Westlake, founder & CEO, Crowdcube; Rob Baines, co-founder, SNOG; Rupert Lee-Browne, CEO, Caxton FX; Charlie Green, co-founder & co-CEO, The Office Group; Matthew Jaffa, London FSB; Federico Pirzio-Biroli, founder & director, Playfair Capital; Zoe Jackson, founder, Living the Dream; Bryan Adams, managing director, Ph.Creative; Chris Andrew, managing director Europe, Hearsay Social
Global business presenter
or visit: elitebusinessevent.co.uk Elite Business Event2.indd 2
I WORDS: ADAM PESCOD
The end game
t is oft said that entrepreneurs are defined by their exits. Whilst their product may have revolutionised a market or solved an age-old problem, its success is not set in stone until a big fat offer is put on the table. One can reasonably argue that an business owner who doesn’t have their exit in mind from the start doesn’t fit the definition of ‘entrepreneur’, at least in the minds of the majority. “The difference between an owner and an entrepreneur is a true entrepreneur is always on the lookout for the next opportunity,” says Jo Haigh, senior partner at corporate finance and business support company, fds. “Staying still is not an option.” This suggests that an exit can only take one form: the acquisition. But this is far from the truth. After all, in the most literal sense, ‘exit’ implies the end of one person’s involvement, or dominant position, in an enterprise. But regardless of how one’s exit looks, failing to make any preparations for the big day is a dangerous game to play.
The buzz of launching a business cannot be overstated. But it can all go to waste without a viable exit strategy
“A true entrepreneur is always on the lookout for the next opportunity” WORDS: ADAM PESCOD
Jo Haigh, fds
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“An exit doesn’t have to be absolute; there are many kinds of exit including partial equity release, MBO or float,” adds Haigh. “But whatever you choose, you need options or, like a ship without a destination, you float around using fuel for the wrong purpose.” The same is true of an entrepreneur who, whether through chance or choice, steps away from a business to which they are personally attached. “There are all sorts of things that can send you off course be it illness, change of fortunes or even an unexpected opportunity to do something else” Haigh continues. “None of this should change the fact that you need to focus on an end goal.” It also goes without saying that someone who wishes to forgo a sale for the sake of keeping a business in the family must operate in a way that makes such a process as successful as possible. “Whilst this may be a very valid plan, the great entrepreneur needs to consider not only exactly what he is handing over, but to whom,” says Haigh. “This sort of exit needs years of planning
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Phil Cooper, founder
& CEO, Kippsy
“With a business, you do get emotionally involved, so it is very difficult to actually look at exit” Phil Cooper, Kippsy
Jo Haigh, senior
and the really astute entrepreneur will ensure that the heir apparent has had plenty of experience outside the family business.” Ultimately though, there is a reason that acquisitions tend to garner more attention than a retirement or liquidation. Selling a business for an astronomical sum serves as evidence that an entrepreneur has ‘made it’ in the eyes of both their peers and everyday members of the public. Moreover, it means the individual can enjoy a comfortable retirement and puts them in a position from which they can launch new projects – confident of making them a success – as well as attract the interest of fellow business tycoons, who may want to explore the possibility of a joint venture. Essentially, these types of exit are often the domain of the serial entrepreneur. How, then, can an entrepreneur ensure that when it comes to the crunch, they go away feeling that their efforts have been sufficiently rewarded? A decent first step appears to be removing any emotional attachment to the business and focusing firmly on the end game. “My background before was property and, in property, it is very unemotional,” says Phil Cooper, an experienced digital entrepreneur and founder/CEO of collaborative accommodation platform Kippsy. “With a business, you do get emotionally involved, so it is very difficult to actually look at exit. But I think it is important to say ‘I am building a business here – who is going to buy it?’” All things considered, moulding an attractive business proposition won’t happen overnight. As innovative as the product or service may be, there are other components of an enterprise that give it value and will go some way to maximising the eventual sale price. Haigh stresses that the human element is of upmost importance in this regard. “By and large people make or break a business. Without the people there is often little to sell,” she says. “A good product, market position, investment in R&D and strong cash generation all help but this is rarely, if ever, sustainable in the longer term without a team behind it.” Being sensible with money from the outset is
Budgeting & Forecasting Cost Centreâ€™s Profit & Loss Reports
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also a useful strategy. “It is a good idea to always think about whether the decision you are making today will add value when you come to sell, or reduce the value,” says Mark Mills, serial entrepreneur and founder of entrepreneur network Activate. “If you are signing a silly agreement with someone that is probably not going to work, is it going to help the business or is it going to hinder you when it comes to selling it?” Mills can speak from considerable experience here having sold five businesses of his own, including ATM installation firm Card Point, which was valued at £170m in 2006, seven years after he founded it. He adds that getting a firm plan of action written down can pay significant dividends. “If you work on the basis of turning an idea into a plan, and do it in a granular fashion, Mark Mills, Activate then what happens is the future becomes quite predictable,” he explains. “So from the perspective of exiting, you can say ‘if I do turn this idea into a plan, and it is granular, I can see it will make £1m per year by year five – and these businesses typically sell for seven times their annual profit – so I know in year six I can sell this business for £7m.’” The idea of all of this – in a sense – is to remove some of the stress of the exit process itself. In an ideal world, a high price should be more or less guaranteed if you have built your business sensibly and professionally. But it isn’t all that easy. It wouldn’t be an exit without at least some
“Selling a business takes up lots of time and invariably the business itself can suffer”
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negotiation. Suffice to say, tackling this alone can throw up numerous problems, even for the more astute of entrepreneurs. “One of the biggest challenges from the exit process – particularly if you are doing it on your own – is that it is very difficult, in fact nearly impossible, to both run your business and sell it at the same time,” says Mills. “Selling a business takes up lots of time and invariably the business itself can suffer. And if the business suffers, what happens in the process is your price tends to start to nibble down because the buyer says ‘it is not quite as good as I thought’.” Therefore, whilst the entrepreneur will want to have the final say, leaving the nitty-gritty to experienced deal-brokers is a very wise approach indeed. “People who own the business should really be about presenting in its best light rather than arguing over the price,” Mills continues. “It’s a bit like when you sell your house. You don’t actually stand with the buyer with them saying ‘I’ll give you £400,000’ and you saying ‘make it £420,000 and we’ll do a deal’. You do it through an estate agent because you don’t want to be as personal about that deal.” Obviously, building your business to a point where it is attracting buyers is an achievement in itself. But all the sweat and tears can go to waste if the exit process isn’t handled efficiently. Cooper has already been at the centre of the two lucrative exits, but still maintains he could have got more from them. Specifically, he warns of the dangers of an earnout, where part of the purchase price is paid upon the achievement of specific financial goals within a given period after the deal is finalised. “I am not the only one who has had bad experiences in selling businesses in the sense of not realising the full intended sale price,” he comments. “You must remember that when you sell a business, you need to be happy with what you get in your hands and consider any earnout to be a bonus, because if you expect the earnout to be the substance, you could get disappointed.” However, this has certainly not deterred Cooper as his latest venture Kippsy is already getting serious traction in a high-growth market. And he has some words of encouragement for fellow entrepreneurs keen to secure that first sale. “It can be difficult sometimes to see yourself getting through that process but you do. A good, clean business that can be scaled will sell at a decent price.”
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Five-minute money masterclass
WORDS: ADAM PESCOD
Aside from the buzz of launching one’s venture, there is little more exciting for an entrepreneur than securing a sizeable investment of capital to help take things to the next level. However, it is not often just the money on offer that whets the appetite of the business owner. The very people stumping up the cash are often of as much, if not more, interest because of the business acumen and experience they can bring to the table. Moreover, a sacrifice of equity – or at the very least a seat in the boardroom – is a regular by-product of investment deals. In that sense, it pays to be happy with the person or company you will be working with going forward and who, ultimately, will potentially be wielding significant control over your business. How, then, can an entrepreneur go about choosing, and securing, the right investor when the time comes?
Choosing the right investor
(H)Money masterclass - Investors.indd 1
Know what you want Only by identifying the precise need for investment will an entrepreneur stand a chance of securing the investor, or investors, who best fit their business. “First of all, the entrepreneur needs to be in a confident position,” says Darren Fell, co-founder and managing director of online accounting service Crunch. “The second the investor can smell there is a desperate requirement for cash, it changes everything and you often get the wrong investor who wants to sit on your board, control things, and direct it in a way that you don’t want to be directing it.” Indeed, determining exactly what you are looking for has a bearing on the type of investment and investor that would be most suitable. “There is a huge difference between a person who is just giving you some money and a person who
“Sometimes it is really hard to say to yourself ‘I am not going to take this person’s money because actually I don’t really want to work with that person’ when that might be the only lifeline you are being given,” explains Pierce. “But if it doesn’t feel right, it’s not going to get any better once the money is in your bank account. It is only going to get worse. The anxiety and the tension is only going to be exaggerated because if you don’t get along, they are going to start pounding their fist and wondering when they are going to get their money back.” Darren Fell, managing director, Crunch
Ensure you are on the same page An investor doesn’t tend to part with their cash lightly so they must have a vested interest in your business proposition to take a punt. More than this though, an entrepreneur will rest easier if the investor shares the same passion and ambition for their enterprise. “In my experience, where the investment has worked well, there has been a good cultural fit between the investee company and the investor, be it a professional investing entity or an individual,” says Nigel Stanford, partner and head of corporate at law firm Cripps Harries Hall. “That might come because they have a similar approach to how they want to run the business, a similar sort of vision about how the company is growing and developing, what networks the investor has and how well-connected they are.”
Morgan Pierce, CEO, ReferStar
brings a lot more than money to the table,” Morgan Pierce, CEO of employee referral platform ReferStar. “Maybe they are going to actively roll up their sleeves and introduce you to people who might be able to move your business forward, or bring knowledge in terms of what you are trying to accomplish.”
Establish some trust Bringing an investor on board essentially marks the beginning of a long-term relationship, the maintenance of which is crucial to the success of an enterprise. The entrepreneur must therefore have faith that the personality of their chosen candidate is compatible with theirs, and that they can confidently confide in them at any point.
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It’s almost a given that any start-up seeking significant investment is probably one with sizeable, potentially international, ambition. Therefore, finding an investor who has spent some time overseas is a plus in this regard. “Obviously, if global expansion is a huge part of your growth plan, having people who know local markets is going to be essential,” says Sarah Abrahams, investor manager at start-up support service GrowthAccelerator. “Although you might know there is market demand, it is going to take a lot of time to know which different firms you need to talk with to access customers. An international investor who also knows the sector will probably know the companies in that country you need to be talking to and they can set up meetings for you. They can almost come on board as an ‘equity employee’ so they are investing money but also working for your growth plans.”
Get a second opinion Whilst exciting, taking on investment will usually be something new and alien to the majority of start-ups. Thankfully, there are people out there who know the best places to turn and how to secure the best deal for you and your enterprise. “The most important thing when establishing a relationship with an investor is taking advice from a third party,” says Charlie Green, co-CEO of collaborative working space provider The Office Group. “When you are just starting out, you may know your business but what do you know about corporate finance and the world of shareholders agreements? We found that the deal we structured at the very beginning in no way reflected the performance of the business as we grew, but we didn’t have any provision in there to change it. So having the advice from somebody who does know how to tackle these things can be very helpful.”
Nigel Stanford, head of corporate, Cripps Harries Hall
Sarah Abrahams, investor manager, GrowthAccelerator
Charlie Green, coCEO, The Office Group
Another year, another dollar When faced with a new year, a business owner should assess where things stand and how they could be improved going forward, says the ICAEW’s head of enterprise, Clive Lewis
For more info visit: businessadviceserviceblog.com/reports/key-issues-running-business/
ith 2014 around the corner, it is a chance to review and decide what we want to achieve in the year ahead. This also applies to businesses. An SME owner is dependent on the company’s health. When you’re running a business day-to-day, it’s so easy to get overwhelmed and frantically busy. Every now and then, it’s great to find the time to step back and recap – and the new year provides that opportunity. It’s a chance to go back to basics and remind yourself what being in business is really all about. Essentially, there are five key areas to any healthy business. We call these your ‘permanent priorities’ – i.e. areas you need to keep tabs on all the time. First and foremost are your customers. Your focus always needs to be on winning and keeping customers, continually improving your understanding of them and the competitive environment in which you’re operating. The new year could be the time to refine your marketing plans and take advantage of new opportunities, all the while not forgetting to promote your business and your products. Second is cashflow. This, of course, is the balance of all money flowing in and out of your business, with the main inflow generally coming from sales. Our advice would be to look ahead for peaks and troughs. The more warning there is, the more time you have to deal with them. You must know when to focus completely on sales and get your invoices paid. Planning ahead will make it much easier to line up any further funding you may need.
Your focus always needs to be on winning and keeping customers
Then there are employees. They are a critical component of any business machine. You need to make sure everyone in your team is performing well and overcoming any problems. A good starting point is recruiting the right people. You must also lead and motivate staff whilst monitoring performance by holding regular reviews. Failure to discuss and resolve any problems and frustrations means you run the risk of people leaving. Selling skills are also critical. If you don’t subscribe to the hard-sell ABC mantra that you should ‘always be closing’, you should at least be aware that as you are the representative of your business, you are always being evaluated and judged. Therefore, it pays to make sure you establish the right attitude, training and approach, and constantly develop selling skills above all else. The final thing to remember is costs. You need to control your costs carefully. Apart from anything else, this is often the easiest way to improve short-term profitability and the cash that you need flowing back into sustaining your business. If you understand all of the above, then you’re well on your way to a winning formula.
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03/08/2012 15:21 14:31 19/07/2012
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SALES & MARKETING
A voice less heard T
WORDS: ADAM PESCOD
Ethnic minorities in the UK currently account for almost one sixth of the population with a buying power of £300bn. Why, then, are more brands not taking advantage of this opportunity?
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he multicultural makeup of the United Kingdom is one of its defining qualities. As a nation, it prides itself on being inclusive to all nationalities, races, religions and ethnicities. This is reflected by the fact that 12% of the UK’s population is currently classed as being from an ethnic minority. And this proportion only looks set to grow over the course of the next decade. Given such figures, one would think that brands must be chomping at the bit to cater to the needs of this ever-increasing group of consumers wherever possible. However, this doesn’t quite appear to be the case. According to research published last year by the Institute of Practitioners in Advertising (IPA), the UK’s ethnic minorities currently boast a spending power of £300bn and rising, yet efforts to take advantage of this are surprisingly rare. One finding from the IPA’s report was that only one in 20 adverts made in 2011 featured ethnic minority actors. Whilst cuts in public sector advertising and the
closure of the government’s Central Office of Information (COI) played a large part in this, the IPA maintains that most mainstream marketing strategies are failing to take ethnic media, and the ethnic minority consumer, into account. This obviously provokes one overriding question: why? “Most of the mainstream brands haven’t understood that ethnic minority consumers are themselves a force in the UK,” suggests Prasad Manjrekar, media director at communications agency Mans Media, which specialises in connecting brands with ethnic audiences. “I believe that there is a vast amount of space available for businesses to target these audiences.” Manjrekar cites the explosion in the number of Asian television channels as an example of the type of opportunity that brands should consider exploiting as a means to reach this demographic. “It is a relatively unknown fact that Asian channels are equal to the reach of mainstream channels such as ITV and Channel 4,” he adds. “That is something that is not often taken into consideration.” Of course, this trend hasn’t been totally ignored, but there is a consensus that those who have made efforts to break into ethnic media in this way have thus far fallen short.
SALES & MARKETING
“Nowadays, there is almost something like 100 advertisers who are placing spots on ethnic TV stations but without planning, without thinking,” says Saad Saraf, CEO of marketing agency Mediareach and chairman of the IPA’s Ethnic Diversity Forum. “I think that is money wasted because with a little bit more tweaking to the message, they could generate a huger amount. We did this for TalkTalk, we did this for BT. If you tweak the message so that it is the right message, you will have more calls to action.” Another part of the problem, it would seem, is a failure to get to grips with the behavioural patterns of consumers from ethnic minorities. As a result, brands may lump this demographic in with their traditional target audience, under the assumption that its spending habits and purchase decisions are in alignment with consumers from a white background. However, there are a number of characteristics that set consumers from ethnic minorities apart, and which present a compelling picture for modern marketers and small business owners “This is an increasing niche and it is going to keep increasing for the next three to four decades or beyond because we have second, third and fourth generations,” says Saraf. “It is not far from following the trends in the US, so you are getting younger consumers because the majority of ethnic consumers are young, Generation Y, and they are going to be tech-savvy, they are going to be big spenders, they have disposable income, money to spend.” This is put in further perspective by Manjrekar, who adds: “Asians in particular earn above the national average so that means there is
“Most of the mainstream brands haven’t understood that ethnic minority consumers are themselves a force in the UK”
of the UK’s population is from an ethnic minority, boasting a spending power of
(H) A voice less heard.indd 2
a vast amount of spending capacity that Asian minorities have over the other ethnicities in the UK.” The big spending power of the ethnic minority audience can also be explained by another unique purchasing habit, according to Saraf. “Their purchasing patterns are in Prasad Manjrekar, Mans Media bulk,” he explains. “Their consumption is high because they entertain and they eat a lot so therefore, even though they are less than 20% of the population, their spending could be 50% because of that consumption rate.” The opportunities on offer for brands in the fast-moving consumer goods space are palpable in this regard, and Saraf does admit that the likes of Asda and Tesco are already tapping into it with relative success. Moreover, Tesco is going some way to cater for the various religious festivals that are celebrated by consumers from this particular demographic, something which can’t be said for the majority of other retailers. “The other brands have not taken advantage of the benefits they can get out of this multitude of festivals,” says Manjrekar. “We have seen it happen from the ethnic brands in the UK but that kind of approach is lacking from the mainstream brands. They are not trying to cater to every single market.” For any business owner left feeling sceptical about the benefits of dedicating marketing to such events, Saraf adds: “If you understand the ethnic consumers, you could have five Christmases every year – so that’s five times the consumption boom.”
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SALES & MARKETING
media director, Mans Media
Saad Saraf, CEO, Mediareach
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Yet, as intriguing as the above characteristics are, there is one other that may grab the attention of a start-up trying to stamp its mark on this audience. For, when it comes to brands, Britain’s ethnic minorities don’t often stray from a chosen path, so to speak. “What you find is that ethnic consumers are brand-loyal consumers. They don’t switch easily,” says Saraf. And the luxury car market is one where such behaviour is particularly visible, with the IPA research revealing that ethnic minorities are three times more likely to own a BMW. That isn’t to say other brands have little to gain from this rigidity though, and the age factor comes back into play in this regard. “The people that drive Mercedes-Benz are predominantly Arabs, Asian and Chinese,” Saraf explains. “The second generation has started switching to BMW because they don’t want to drive what their dads are driving. But all of this is because the targeting happened early on and they captured quite a niche market.” And it will come as little surprise to learn that Jaguar is now tapping into this trend too. Essentially then, an intrinsic part of successfully capturing the ethnic consumer is garnering a thorough understanding and appreciation of their culture, everyday needs and buying behaviour. That may sound akin to most modern marketing campaigns, but the other side of the coin is identifying the right channels through which to engage with this market, some of which are relatively unknown currently. Employing the help of a specialist agency is naturally a decent place to start, but there are some simple steps that a right-minded business owner can take to at least get off on the right foot. “If I see something that has some sort of Arabic culture or a face, I will sit up and take notice,” says Saraf. “We see lots of direct marketing, but if I receive a direct marketing piece which is slightly different and has some sort of cultural images in it, I am going to open it, I am going to read it.” Delving further inside conventional target markets can also help reveal the little nuggets of information that could make all the difference to future marketing efforts. “If you look at companies like Procter & Gamble, they target based on age, so they have a product per age, rather than looking at how many black women or Chinese people fall within that age,” Saraf continues. “So I think marketeers are wasting quite a bit of the budget by not applying some sort of analytics.” And with more businesses looking abroad than ever before, capturing the imagination of ethnic consumers on home soil should make life a little easier when venturing into geographies where such cultures are more prevalent.
“Ethnic consumers are brand-loyal consumers. They don’t switch easily” Saad Saraf, Mediareach
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WORDS: JOSH RUSSELL
SALES & MARKETING
The benefit of experience The importance of capturing your customers’ imagination is something that has gained a lot of currency in the consumer space but, in fact, this is just as important when closing a B2B deal
face-to-face.” This would seem counterintuitive, given e-commerce has mall- to medium-sized enterprises so thoroughly supplanted the high street in (SMEs) have a fair old fight on their many people’s shopping habits, but it is worth noting that the B2B space is very different to hands when trying to convince the world of B2C. Often in the consumer corporates to make significant bulk orders. sector, relationships are built around brands But, when attempting to increase the depth and value of sales, it’s vital to understand that and whilst experience is key to strengthening even the purchasing preferences of serious these relationships, customer loyalty is comparatively easy to maintain online. “A lot businesses are influenced as much by emotion of us who shop regularly with Amazon feel and intuition as they are by the business case. that we have a relationship with them,” For this reason, appreciating the important role that imagination and Edwards says. “That is down to truly exceptional experience can play for the marketing and the way they decision is absolutely vital. treat us as customers.” Right out of the gate, it’s Another example Edwards essential to understand most purchasing decisions are gives is that of John Lewis; a geographical area in which influenced by a sense of trust the retailer builds a store and connection. “My view is often a witnesses a that, in order for people to Richard Edwards, Quatreus trade, they need a reciprocal increase in online sales, essentially suggesting the immediacy of a relationship,” comments Richard Edwards, physical connection can actively increase the director of experiential marketing expert trust shoppers are willing to place in the Quatreus. And, despite all of the bluster we often hear about the fact that our social brand. “John Lewis has effectively managed to extend what it does in-store to its online relationships are moving online, often activity,” he comments. immediate experiences form stronger loyalties However, whilst shoppers may spend up to a than interactions online. He continues: “The few thousands pounds for certain items online, best way to create that relationship is through
“My view is that, in order for people to trade, they need a relationship”
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outlays for business owners when buying products and services can dwarf such meagre sums. Additionally, business products rarely have as high a visibility as those aimed at consumers. Drawing on the example of buying an iPad, Edwards explains that an individual already has trust in the product and will simply be shopping around for price and delivery options. “Within the B2B sector, the ‘product’ is often very intangible, very difficult to get a handle on and very difficult to understand,” says Edwards. “And this is not something that people buy online.” Building this sort of trust takes time. But one thing that can obviously facilitate this is building up a history of real and positive experience of your brand amongst potential customers and it is here that a little creativity can prove superior to simply throwing vast marketing budgets at the problem. Edwards refers to an event Quatreus put on for BT, running a private screening of the last two Harry Potter films for around 75 of its most high profile clients. It allowed the children and grandchildren of those invited to see that content before it was in the public domain, creating a real event for those clients and their families, and, whilst it would be disingenuous to credit this fact purely to something as simple as a sneaky peak at some pre-release Rowling, it is worth noting that every single client present ended up doing further business with BT. “It’s all about people getting to know bits of their private lives as well as their public lives,” says Edwards. “That is essential relationship building.” But it’s not just social events that can benefit from a more imaginative approach. Most B2B-focused companies make heavy use of events to network and educate the public about Richard Edwards, Quatreus their offering. However, often these enterprises fail to realise the real benefit of meeting people face-to-face, instead swamping their customers with information. “You see people coming up, looking at it, nodding sagely and going probably to the nearest bar to bury their heads because they simply don’t comprehend what it could do for their business,” Edwards comments. Whilst the figures and data might sound impressive as a hard sales pitch, it’s not necessarily the best way to communicate to a customer the
“We create reallife scenarios and we create stories, then physically build those environments”
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use to which they can put a product. And this is where imagination and experience really come into their own. Edwards elaborates: “It comes back to that age old proverb ‘tell me and I’ll forget; show me, I may remember; involve me and I’ll understand’.” And this touches on an entirely different sort of experience, one that is, if anything, even more vital. One of Quatreus’s most striking innovations is its ‘experience centres’, which don’t just concentrate on specs or even technical demos of how the products work. “We create real-life scenarios and we create stories, then physically build those environments,” says Edwards. From vans cut in half to simulated hospital environments, the focus of these experience centres is to put decision makers at the heart of how solutions might function in practice. The example Edwards gives is that of healthcare: pitching a radio frequency identification (RFID) solution becomes much more simple if the client can witness first hand how it supports the easy tracking and moving of patient notes as they move through a healthcare pathway. This shifts the focus from abstract hypothetical to a scenario the customer has witnessed and can appreciate from a firsthand, practical perspective. “We put them into an immersive environment,” Quatreus explains. “We shut them away from their emails, the day-to-day, their stresses and the fact that they’ve got three people off sick; we put them right at the heart of an appropriate and immersive environment so they’re getting hands-on experience with what that product can do.” Engaging with business customers on an experiential level can help them infer values and detail that may otherwise be hard to get a firm handle on. “It’s purely about real life,” concludes Edwards. “The way I describe it is, ‘would you ever buy a car that you haven’t driven?’ And if you wouldn’t buy a car that you haven’t driven, why on earth would anybody expect you to buy something of significantly greater value that they haven’t experienced.”
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SALES & MARKETING
Whatever one may think of price comparison websites, they are very much here to stay. The impetus for business owners to shout loudest has thus never been stronger
WORDS: ADAM PESCOD
uch like smartphones and social media, price comparison websites are now a ubiquitous part of our lives. Whilst they may have spawned some cringe-worthy television adverts, it is hard to deny the service that the sites provide has become almost invaluable to the contemporary consumer. “The internet has empowered people with knowledge and, coupled with the daily stream of adverts for price comparison sites on TV, consumers know they can use this to get the best deals at the best prices,” comments Graeme Sandwell, managing director of affiliate marketing network, Paid On Results. “Combined with the lack of loyalty from customers as the demand for saving money increases, price comparison sites are a natural fit to allow those customers to find a bargain and save time as the choice of retailers nowadays means there are too many to manually check them all.” Given that comparison sites are seemingly here to stay, there is almost no hiding place for the business owner. On the contrary, being listed alongside competitors – a number of which may be offering a lower price – only reinforces the incentive to offer a high-quality product and level of service. “It makes you give a reason for any difference in price,” says Sam Cropper, CEO of eco-friendly car service provider, Climatecars. “It makes you be more clear on what you are offering and, especially if you want to pull away from competing solely on price, that is obviously very important.” Indeed, the evidence suggests that it is not always the firm offering the cheapest deal that succeeds. “Often it is companies that have a competitive price and a good name for quality service that win out,” explains Mark Todd, director of energy price comparison service, energyhelpline. “If a fairly unknown company or one with a tarnished reputation is top, they are very unlikely to take the most customers. So it isn’t just necessarily a race to the bottom.” And whilst comparison sites may naturally force businesses to compete on price, Cropper warns of the dangers of treating them like the afore-mentioned race to the bottom. “In lots of markets, you have got to be very careful when getting involved in something like that because if you do, it chips away at your margins, which chips away at your standards, which chips away at your service levels and before you know it, you are losing your premium clients,” he says.
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SALES & MARKETING
“Often it is companies that have a competitive price and a good name for quality service that win out”
Mark Todd, director, energyhelpline
Of course, one could be forgiven for asserting that price comparison sites are something of a necessary evil. But, on the whole, they do appear to be a force for good, both for the consumer and supplier. The first benefit comes from the very size of the audience that they put businesses in front of. “It brings people who we wouldn’t normally reach or who wouldn’t normally use our service, and that is obviously an advantage,” comments Cropper. Moreover, the additional custom that Climatecars receives through its partnership with aggregator-style services helps keep the business ticking over at all points of the day. “At peak times, we have no capacity and so we will turn down cash work, we will turn down one-off bookings and we will turn down the aggregators that are trying to put work into us through their comparison services,” he says. “However, at the troughs, it is very convenient for us to be able to pick and choose work even if it may be at a lower margin or not exactly the type of work we are looking for in terms of geographical location.” Regarding a price comparison site as an outsourced sales and marketing tool unveils another advantageous side to the service – one which is particularly pertinent for start-ups that won’t necessarily have the most sizeable marketing budget. “It means that you can effectively concentrate on running the business,” says Todd. “Obviously, you will probably still need a PR agency, you will need some kind of limited marketing team, but you can simply offer a competitive price and allow the price comparison service to do all the hard work of pricking the consumer interest.” The nub of the comparisons site debate is nonetheless whether a partnership with such a service can serve as a primary revenue stream. Todd reveals that for some energy suppliers, 90% of their customer base will come through a comparison service, but adds that a particularly lean approach is necessary for it to be truly sustainable. “You are going to need to build a business with a low cost base,” Todd says. “If you can do that, you will be able to offer a competitive price and gain customers.” It is indeed evident that small firms in the insurance and energy sectors are reaping the rewards of price comparison sites, with Direct Line a rare example of a more established company not choosing to partner with one. And whilst going in at the cheap end of the market may not suit the tastes of all business owners, the fact remains that partnerships with comparison sites generally work on a ‘pay per sale’ basis. This seemingly minimises any risk of utilising their service from the business owner’s perspective. Todd explains: “The only risk is that a company comes out with such a low price and gets such a huge customer demand that they can’t actually satisfy that.” Start-ups can certainly pick up some ‘quick wins’ on comparison sites, especially if an attractive price point is accompanied by an equally appealing commodity and level of service. “There is no harm in coming on a price comparison site,” concludes Todd. “All you can do is gain some customers because people are going to go there anyway. If you don’t buy a ticket you don’t win the raffle.” Either way, having access to an entire marketplace at the click of a button can only serve to benefit those on both sides of the fence.
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Free reign Given the increasing number of professionals picking and choosing contracts case-bycase, has the time come for freelancing to take its place as the ruling employment option?
WORDS: JOSH RUSSELL
t could be argued freelancing is the new entrepreneurialism. Given that, according to research commissioned by the freelancers’ association PCG and conducted by Professor John Kitching of Kingston University, 85% of the jobs lost during the recession were replaced by people going into work for themselves, it’s fair to say that start-ups and freelancers are two halves of the coin that’s replenishing the nation’s coffers. The recent National Freelancers Day on November 21, crowned by a live debate between Sir Peter Ibbetson, chairman of Business Banking at Natwest and RBS, and Jayne Atherton, business editor at the Metro, shows the extent to which serious business figures are championing how vital freelancing is to the economy. And this is no empty rhetoric. The PCG research also demonstrated that freelancers contributed £95bn to the UK economy in 2012. “There is now a growing realisation of the importance of freelancing,” says Simon McVicker, director of policy and public affairs at the organisation. And it’s not just Britons that have embraced the value of freelancing: from 2004 to 2012, Europe saw an overall increase of 63% in the number of individuals selecting their own contracts. McVicker adds: “There has been this overall trend in the percentage of people working freelance going up, really since the early 2000s.”
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“There is now a growing realisation of the importance of freelancing” Simon McVicker, PCG
Evidently, recent economic troubles have had an impact on the number of people looking to freelance. “When we went through the recession, people who lost their jobs didn’t go down the traditional route,” explains McVicker. “They decided ‘let’s go out on our own and see whether we can do something by ourselves’.” As with the number of entrepreneurs who took the impetus of an uncertain financial situation to seek a more fulfilling path, plenty of freelancers’ new careers were the silver lining to the stormy clouds of the credit crunch. This is having a very real impact, not just for the economy but also for the professionals themselves. “I’ve seen that British freelancers are earning nearly a third more than they were in 2011,” says Gary Swart, CEO of international freelance marketplace, oDesk. “On oDesk we’re seeing the average freelancer’s earnings have grown 190% in three years.” The result of this is that not only are people able to stay in work but they are actually in a better position than they were prior to the financial crash. 58
“A lot of young people don’t want to go through the traditional route of ‘get a job, work for somebody else’” Simon McVicker, PCG
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But there are other factors at play. First of all, McVicker feels stage of life can play a role. “A lot of young people don’t want to go through the traditional route of ‘get a job, work for somebody else’,” he comments. The old paradigm in which a person swears fealty to a single firm for ever more has well and truly crumbled. “They want to try and start up themselves and create something.” Equally, there is a reaction among the older generation who have perhaps paid their dues in terms of loyalty to a specific company and now feel freelancing could provide them with an opportunity to stamp their own mark. “They may well have learnt their skills and now think they would rather like to take this opportunity to go it alone,” says McVicker. Additionally, there may be individuals approaching retirement age who actually don’t want to head straight to the golf course. He continues: “Older people who don’t want to retire are also seeing this as a good alternative.” But, of course, there’s a silicon-infused elephant in the room. “Technology has been hugely significantly in all this,” says McVicker. “People are able to work using their laptops or their iPads, they can work online, they’ve got social media. We’re going through a sociological change and I think that’s down to the technological revolution we’ve gone through.” Whilst for decades freelancing has been a significant tool for many different types of workers, it seems unlikely the flexibility and ease with which modern freelancers are able to secure work would be possible. “Historically it’s been very gig-based, where a freelancer felt like they had to go out and fight for every meal,” says Swart. Fortunately, tools such as oDesk are making it far easier than ever
now work in the UK
contributed to the UK economy
percentage increase in average wage:
before for freelancers to pick and choose contracts suited to them. “The internet is breaking down barriers and bringing clients into the UK that normally UK freelancers wouldn’t be able to get a job with,” he continues. “With more than 125,000 oDesk freelancers in the UK alone, you’re truly working for clients all over the world.” It’s relatively easy to understand why this offers better returns in terms of your takehome, but there are subtler benefits up for grabs. “These workers are becoming more skilled,” says Swart. Rather than being required to divert attention to ancillary tasks, individual freelancers are able to focus on the exact areas in which they specialise and choose the briefs that help support their personal goals. “They’re growing and developing because they’re working on the jobs of their choosing with the freedom and flexibility that they want.” There is a question, however, that might lurk on the lips of an individual without experience of the world of the freelancer: what of security? Given a contract guarantees long-term employment and freelancing offers no such protection, why are individuals switching over in their droves, especially in such uncertain
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“They’re growing and developing because they’re working on the jobs of their choosing with the freedom and flexibility that they want” Gary Swart, oDesk
economic circumstances? Intriguingly, there is a causal relationship between these two factors. “All of your eggs aren’t in one basket,” comments Swart. He refers to a US-based customer of oDesk who lost her job after being diagnosed with cancer; upon her recovery she decided not to re-enter the workplace and now freelances for six clients. And, in actuality, this means she is in a far more secure position, even if issues arise with an employer. “If one lets her go or she decides she doesn’t want to work with that client, she still has five clients.” Taking into account the fact that it offers employers increased flexibility, freelancers more money and resilience, and has injected much needed cash into the economy, are we going to start seeing freelancing taking over as the norm? According to the findings of another piece of research conducted by PCG in December 2012, this time in conjunction Professor Andrew Burke of the Cranfield School of Management, probably not. “One of the findings was that these bigger companies that take on freelancers actually in the end create permanent jobs,” explains McVicker. “They try out different things using freelancers and when they realise it’s going to work, they take on permanent employees.” This is something affirmed by Swart. A survey oDesk conducted with its users asked, if they hadn’t been able to use global freelancing platforms, whether they would seek to fill the positions locally. Just 15% said they would. “This is lift not shift,” he explains. “These aren’t jobs that are going away because freelancing exists; these are new jobs that exist because of platforms enabling it.” And this doesn’t mean that the potential for long-term relationships doesn’t exist, with regular freelance arrangements emerging. He continues: “Knowing how difficult it is to find great talent, when companies find great talent they want to keep it.” This is perhaps the real strength of freelancing. It isn’t a mechanism that further intensifies the scrabble for jobs by shifting UK roles abroad: instead it provides a testing ground to float new projects and departments with less risk to the firm. And the increased flexibility and wages are also proving popular with those that have set up for themselves. “Freelancers love the freedom and flexibility of working this way,” concludes Swart. “They just like it better.”
“If the person is taking on more responsibility or people have left and they are being asked to cover more than one job, the employer should have been preempting that and not waiting for the employee to ask for a pay rise,” says Jane Hurn, finance director at business support firm Innovate Now. “But if somebody is having children or school fees have gone up, it is not necessarily down to the employer unless there is greater strain being put on that person, so much so that they should be recognised differently in terms of their pay.” When it comes down to the nitty-gritty of reaching a decision, the employee won’t necessarily be expecting one in an instant. Either way, making it clear that you will need a few days to weigh everything up is a useful strategy. “The important thing is to buy yourself time,” says Enrique. “If somebody comes in and says they want a pay rise and you say ‘sure, absolutely’, you may have bound yourself into a pay rise for somebody who doesn’t deserve it.” He adds: “He or she may be doing the job they are paid to do, but they may not be going over and above. In that sense, it may be better to tell them that you will reconsider a pay rise when they get to the appropriate level or standard.” Of course, whatever decision is reached should leave the employee sufficiently satisfied, so collating all the evidence at one’s fingertips is essential. “It is about looking at the culture of the business and seeing how that fits in, and what the long-term view for the business is going to be,” says Hurn. “That person may have been, over the last six months, going above and beyond and doing more, but if the next six months are going to be quiet, it is six of one, half a dozen of the other.” Moreover, as much as matters surrounding pay should be kept confidential, having access to the facts is also handy should news of a pay rise somehow find its way onto the grapevine. In the worst case scenario, another employee may feel discriminated against, so having that information on tap can stand you in good stead. “Should an employee try to bring a claim against you for discrimination because someone else got a pay rise and they didn’t, you are going to have to be able to justify that,” says Enrique. “At that point, you would then need hard facts to demonstrate why and give them some guidance to keep them happy and stop them from leaving.” Ultimately though, a healthy application of transparency and understanding should ensure that a resolution on one’s salary sits well with both the individual and the company as a whole.
Weighing it all up A pay rise request from an employee is part and parcel of every employer’s life. But failing to deal with the situation effectively can prove costly
WORDS: ADAM PESCOD
making it clear that you will need a few days to weigh everything up is a useful strategy
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he issue of pay is an emotive one at the best of times. And for business owners at the coal face, deciding upon an appropriate salary for staff can often be a challenging ordeal. Needless to say, a further test of managerial strength is provided when an employee puts in a pay rise request. Instead of cowering with trepidation when a request comes their way though, a decent first step is to accept that an employee has every right to ask the question. “If the employer looks panicked, the employee may lose confidence in their employer,” explains Enrique Garcia, consultant at the Employment Law Advisory Service (ELAS). “Even worse, if you show them that you are somehow scared, they will keep doing it because quite simply they will think you are too scared to lose them.” Essentially, no pay rise request should be met with surprise. Not only is it a regular occurrence in all businesses, but an efficient performance review system should ensure that any request comes at a time when a decision to grant a pay rise was already being strongly considered. But if the request does come somewhat out of the blue, getting to grips with the reasons is a good place to start.
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Martin Reed Reed has been at the helm of psychometric testing company Thomas International since 2007, having been appointed chairman two years earlier. As well as penning this regular column for Elite Business, he is also a founding member of Buckingham Business First and a fellow of the Institute of Directors.
The evolution of HR 64
In his final column for Elite Business, Martin Reed explores how the employer-employee relationship has changed over the last three decades
s one of the UK’s leading psychometric companies, we’ve seen many changes since launching in 1982. Changes to the education system mean that qualifications are no longer a reliable indicator of an applicant’s abilities and managers now realise that staff satisfaction is not all about salary. Meanwhile, increasing numbers of employers are embracing different tools to help them manage their recruitment and HR needs. Taking those changes into account, the process of recruitment and retention has evolved in kind. A better understanding of people, their needs and requirements means that recruiters are now better equipped to handle the process of hiring, retaining, developing and managing staff. The role of the HR department is no longer limited to dealing with recruitment and disciplinary issues, but also how it can work with staff throughout the ‘lifespan’ of their employment. One of the biggest changes we’ve noticed over the past few years is employers’ realisation that finding a person with the right behaviours and abilities for the role can be more important than their skills, which can be taught and developed. Employers are aware of the need to benchmark what each role requires, which can go a long way to helping identify the
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“By understanding your team, you can pinpoint what’s holding them back, giving you the ability to identify how you can help motivate and engage with them”
right person for the role and make the recruitment process faster and more efficient. When you take into account that making the wrong decision can cost up to two and a half times that person’s salary, hiring the right person first time round becomes even more crucial. Staff retention has also become more important to companies as they realise that maintaining an engaged and motivated workforce has a number of benefits including reducing the number of sick days people take, maintaining team morale and providing clients with consistent levels of service. With reports stating that one in four employees is looking to leave their employer within the next 12 months, ensuring employee satisfaction is vital. One of the most effective ways to achieve this is by looking at staff of management time is as individuals. By understanding each individual’s strengths and spent dealing with poor limitations, you can find out how performers they work best, what their preferred style of communication is and how they like to be managed. This will all help you to translate this into how you work with them, helping to maintain staff satisfaction levels, loyalty and motivation. Anyone who deals with staff directly will also find significant benefits in achieving an understanding of their own management style; this will then help them to modify it when communicating with staff with different styles.
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Meanwhile, employers are realising the importance of developing staff and although budgets are still tight, it’s essential that employers continue to invest in training. In the short-term, staff training will help your team feel supported and see that you are committed to investing in them while, in the long-term, appropriate talent development programmes will benefit your company’s future plans. Implementing effective training takes into account your long-term objectives and companies which are successful are those that incorporate training into their forecasts and business planning. Finally, there has certainly been a trend over the past few years for companies to be more willing to look at how they can help their staff to deal with the issues which may be hampering their performance rather than to see the problem as cut and dried. By understanding your team, you can pinpoint what’s holding them back, giving you the ability to identify how you can help motivate and engage with them. Given that on average, 80% of management time is spent dealing with poor performers, good performers are often neglected, so spending time finding out what challenges your staff are facing can ultimately save time and money and benefit the whole team. There was little emphasis on staff satisfaction or motivation 30 years ago, but since then employers have learned that through understanding how to achieve staff satisfaction, efficient teams and low staff turnover, they can increase their chance of success and with an increased focus on companies’ responsibilities to their staff, this trend will only continue.
This is my last column for Elite Business; to find out more about how you can improve your HR processes, visit www.thomasinternational.net
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Three words that are likely to strike terror into the heart of even the most hardened entrepreneur: Christmas is coming. No matter how organised you are in your professional life, there’s something about the festive period that seems to secrete stress like a neurosis-inducing sap. ‘Tis the season for panic-buying turkeys and realising the crackers you’ve fished out of the cupboard for your ageing parents are those ever-so-unfunny erotic ones bought on a whim from Ann Summers years previously. Fortunately, we’re here to make at least one element of your Yule a little less stressful with our stuffed stocking of gifts and gadgets
1 iPad Air
The history of Apple can best be summarised through the catalogue of iconic devices it has brought to market and, if this is the case, a new annal could be launched with the iPad Air. The tech giant’s approach to souping up its devices hasn’t changed much – its latest tablet is certainly skinnier, more mobile and comes with a battery life that would make the Duracell Bunny weep tears of defeat – but the iPad Air is perhaps the most definitive tablet the Cupertino firm has ever released. Solid, powerful and yet far from unwieldy to handle, it’s fair to say this may be the best £399 you could ever spend.
WORDS: JOSH RUSSELL
2 Google Nexus 5
Packing the latest version of Android, the much-discussed KitKat, and picking up some of the delightful aesthetic tweaks from the recent Nexus 7 reboot, the Nexus 5 shows Google isn’t scared to step up to the plate. Perhaps one of the most significant selling points is its 4.95in, 445ppi screen; considering its assumed arch-nemesis, the iPhone 5s, only musters 326ppi, this should alone be more than enough to win over the floating voters. But where the handset really slays the competition is its price: it retails at £300, nearly half the cost of the latest iPhone. It goes to show that a game-changing smartphone doesn’t necessarily have to come at a premium.
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3 The Carpenter Collection
6 A Touch of Code
Living as we do in digitally permeated bubbles for the vast majority of our waking lives, sometimes at Elite Business we like our tech to be a little more honest and homespun. And it’s hard to find tech more unspoilt than Analog Watch Co.’s Carpenter Collection. A marriage of the finest leather and woods, these sylvan timepieces are as understated as they are beguiling, cutting back on extraneous complications to better display the natural beauty of the raw materials.
There’s a fair chance Hövding has already permeated your consciousness; whilst it has actually been on the market for several years, this ‘invisible bike helmet’ has really begun to pick up steam on social media of late. And it’s for good reason. This is easily the most significant redesign the humble bike helmet has ever seen. It jettisons uncomfortable polystyrene headgear for a true 21st century innovation, sleekly concealed within this unassuming neckwear. We won’t spoil how it works – instead we recommend that you track down Fredrik Gertten’s short documentary The Invisible Bike Helmet and fall in love with Hövding like we have.
Singling out just one of dconstruct’s products for praise seems a little reductive, particularly given how striking they are. Made from recycled material and ethically sourced organics and textiles, each of the Canadian jeweller’s items is created by hand and marries natural materials like banana fibre, seaweed and bamboo rings with reused, pre-consumer resin. For lovers of natural materials and a stripped-back elegance in their jewellery, you’d be hard-pressed to find a better gift.
One of art’s prime functions is to hold up a mirror to life and, given the fact that technology is very much the defininition of our times, it’s hardly surprising there are so many artists looking to explore the relationship between tech and experiential art. Knocking down all of the boundaries between art, architecture, tech and design, A Touch of Code: Interactive Installations and Experiences looks at the multitude of creatives hacking art wide open and brings together some of the most exciting examples of technological art into this striking coffee table book.
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The next dimension 3D printing has attracted some unwelcome press of late. But there is no doubt that it will revolutionise the world we live in and transform the business landscape in the process
WORDS: ADAM PESCOD
s descriptors go, ‘the next big thing’ is a rather common one in the world of tech. More often than not however, its use only serves to raise eyebrows as the supposed technological phenomenon to which it is attached fails to live up to the hype. On the flipside, there are some things that comes along now and again that fully justify such a label. Unless you have been living in a cave for the last year or so, it is nigh on impossible to have missed the mass attention that is currently being garnered by 3D printing. And whilst some of the most recent press has revolved around the discovery of 3D ‘gun parts’, it seems that the opportunities presented by the technology far outweigh the risks. Not only has a significant price reduction made it more accessible to consumers, but businesses are starting to harness the power of 3D to their advantage in ways never before witnessed. Some of the leading pioneers of the technology are opening their doors to companies in the manufacturing and healthcare spaces, among others, and rewards are being reaped on both sides. From the engineering of human organs to the construction of ‘3D-printed houses’, it is clear this is not going to be a flash in the pan. One person who would vouch for this is Eoin Lambkin, business development manager at DIY gadget brand Takker. The firm’s latest product, the Hard Wall Takker – a hand-powered ‘no nails’ device for wall-hanging – was prototyped with the aid of one of the more advanced models of 3D printer. Suffice to say, the access Takker has been granted to it has transformed the business in ways that would have been unimaginable ten years ago. “When we launched the original product, there was no 3D printing available,” Lambkin explains. “Our founder appeared on Dragon’s Den in the Republic of Ireland, got investment, but had spent years trying to design and
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develop the product and was paying for expensive prototyping.” In layman’s terms, the previous way of doing things involved the use of a laser cutting tool, a process which leant itself to repeated efforts to perfect the final product and could often take a matter of weeks or months. However, provided one has sufficient experience in computeraided design (CAD), a 3D-printed prototype can be produced in the space of a few hours in some instances, and a couple of days in others. This had a significant bearing on the speed at which Takker has been able to get its product to market with over 2,000 customers purchasing it upon its QVC launch last month. And the fact that consumers and retailers only had the product’s 3D prototype upon which to base their purchase decision is testament to what the tech can achieve. “We convinced them to buy the product before it had even been manufactured,” says Lambkin. “We managed to take a concept to production in less than two years, whereas the previous product had taken six years for a single guy with a good idea to get into the market.” Moreover though, much like the internet has connected businesses and suppliers from all corners of the globe, Lambkin believes 3D printing is doing something similar, albeit rather more exciting. “The new wave of business thinking is collaboration and 3D printing means you can bring together people disparately,” he comments. “I am here in Belfast but you have got guys in Kuala Lumpur and Sydney who can see the product at the same time as we would see it. You can all have the same thing printed in your part of the world, at a low cost, and then make a decision.” The implications for start-ups and SMEs are palpable. “Prior to 3D printing, it was only people with access to resources, finance and engineering skills who could do it,” Lambkin adds. “What it has really
done in some way is democratise product development. It has enabled a small business to potentially become global overnight.” It would be short-sighted to trumpet the riches offered by 3D without touching on some of the reported dangers. Leaving aside the firearms debate, the legal implications of 3D printing along with the threats from increased consumer use have come under scrutiny. Yet, despite some concerns around issues of intellectual property, it seems that the same old rules still apply. “Design right has been around for a quite a long time,” says Kim Walker, partner at law firm Thomas Eggar. “This just puts it into a more immediate context because it is making it easier to copy.” Similarly, whilst the lower end 3D printers are now hovering around the £1,000 mark – thus making them more affordable to larger swathes of the population – the publicised piracy risks to established fashion giants, for example, are somewhat wide of the mark for now. “At this point in time, a lot of those products will be printed from £100,000 or £200,000 printers so Joe Bloggs isn’t going to print a new set of Nike trainers any time soon,” says Matt Hopkinson, print specialist at IT firm LDD Group. “I don’t see it being nearly as much of a problem as, for example, piracy of DVDs and piracy of CDs.” In this sense then, start-ups shouldn’t have too much to fear. If they are operating in a sector that stands to benefit from the 3D Eoin Lambkin, Takker printing phenomenon, the temptation should be to jump straight in. “I am really pleased we are at the beginning of this,” says Lambkin. “It is a real game-changer. It entirely shifts the whole balance.” So, almost twenty years after the 3D printer was first devised, it is now truly starting to work its magic. “The opportunities in a decade’s time and certainly for the next generation will be incredible,” concludes Hopkinson. “They will absolutely destroy any risks involved. Everything will be 3D-printed.”
“Prior to 3D printing, it was only people with access to resources, finance and engineering skills who could do it”
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business development manager, Takker
Kim Walker, partner, Thomas Eggar
Matt Hopkinson, print specialist, LDD Group
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f o y r Dia h c e t a r u e n e r p e entr Our resident tech columnist David Hathiramani provides a first-hand account of an average month in the life of an ‘e-tailor’
Inspiring the next generation of tech entrepreneurs
David Hathiramani He may be co-founder of trendy suit retailer A Suit That Fits, but Hathiramani is also something of a closet geek. And the Imperial College computing graduate is here to impart some of his wisdom about setting up an internet business.
This month, I was given the chance to visit my old school, The Perse. It was at The Perse School that I met Warren Bennett, my A Suit That Fits co-founder – so it’s nice to pop back in every now and again. The school arranged a Dragons’ Den-style entrepreneurship day for a group of year nine students who were tasked with developing an app for other teenagers. They contacted me as they were looking for people with business experience to whom the young people could pitch their ideas and get advice on what makes a business idea successful. When I was younger, these tech entrepreneurship events weren’t offered as an option, and I thought how cool having an event like this would have been as a student. I always loved everything tech when I was younger and I grew up in an entrepreneurial family so always knew that I wanted to start my own business. I’m not sure that my family were so keen on my love of technology all the time; I started playing with computers when I was about seven years old and ended up writing a small program that blocked anyone entering the old BBC computer without the password that only I knew! It just so happens that I was joined at the event by a number of other business people, including inspiring tech entrepreneur Sherry Coutu CBE. We started the day by talking to the students before they went away and developed their concept from start to finish. In the afternoon, we listened in on the pitches and judged for a winner. The quality of the pitches was on the whole really good. In fact, some pitching techniques seemed far more creative than adult pitches I’ve seen and been in. For example, one of the pitches had a team of six standing in a choir formation and, in a random order, they held up a sheet of paper explaining their point. They were short snappy statements, right until the end of the pitch.
“When I was younger, these tech entrepreneurship events weren’t offered as an option”
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Not only was the style of pitching inventive, the whole event reminded me just how much of an opportunity there is in education right now. The ideas that the students came up with were phenomenal, ranging from effective revision timetabling to customised training for your position or level in a sports team. The only frustration is that they’ve still got a few years of school left, so I know none of them will actually execute any of their ideas right now. If I was starting a business at the moment, I’d certainly take a good look at opportunities in this area. Global Entrepreneurship Week
“It’s great to have the occasional opportunity to get out, meet other businesses and share ideas”
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It’s great that Global Entrepreneurship Week promotes entrepreneurship every year, and encourages people to think about starting their own business. We always try and get involved and inspire people where we can. In the past, we set a task to students across secondary schools to develop a new marketing idea for us. We were so inspired by the creativity that we ran our own design competition and opened it up to the men and women of the UK, asking them to design a new suit that we would sell on our website. This Global Entrepreneurship Week, I was invited to the Great British Entrepreneur Awards; we have been lucky enough to win 15 awards at A Suit That Fits, and I always love going along to the ceremonies. In business, you are always working so hard on what you do day-to-day that it’s great to have the occasional opportunity to get out, meet other businesses and share ideas. Thinking about Christmas
It seems funny as a retail business to be thinking of Christmas in July, but we’ve had it on our minds for a while. As a small business, we don’t have the budget for big ad campaigns to mark the season, but it doesn’t cost anything to have some fun! All of our teams work together to make sure that we do some fun stuff around the festive season; customers always have a mince pie in the studio and we team up with our lovely partner brands to run a big competition for our customers in the lead-up to Christmas. Past prizes have included a hotel day and a driving experience. From an IT point-of-view, our team have been working on making sure our new gift sets are up on the website so our customers’ friends and family can purchase some bespoke gifts for them online. Alternatively, men can buy them for themselves. Our printed pocket square and cashmere tie gift sets both include a £50 voucher to put towards their next suit.
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Bishop’s Move captures three new franchises
WORDS: ADAM PESCOD
Subway ramps things up on the Emerald Isle We reported a couple of months back on Subway opening its 40,000th store worldwide in Ipswich, not so far from Elite Business’s previous abode. Nevertheless, fresh from one landmark, the global sandwich giant has now announced yet another, having reached the heady heights of 1,700 stores in total across the UK and Ireland. The responsibility for this feat lies at the feet of one Owen O’Driscoll, a businessman from the Irish city of Cork, where he has opened the outlet – his third for the company. It comes as Subway has announced plans for a further 40 stores in Ireland in 2014, creating up to 400 new jobs and represent an investment of somewhere in the region of €5m. The latest opening takes the total store count in the Republic to 117 and the 16th new store in the country this year. “In Ireland the SME sector is the backbone of our economy and for me the opportunity to start and run a business has been fantastic,” said O’Driscoll. “Starting from a base of zero I now employ a team of over 26 people across three stores.” This is certainly the kind of story to dispel Ireland’s recent economic woes.
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With the housing market starting to pick up again, having access to a reliable removal service is always handy. Well, people in the North East and Midlands will be dancing in their driveways this month after Bishop’s Move – the UK’s largest family-owned removals company – appointed three new franchisees across the two regions. The company’s appointment of Newcastle-based Brown & Illingworth, Wrekin Removals in Shropshire and Cannock-based John Lomas Removals is part of Bishop’s Move’s efforts to strengthen its offering in these particular parts of the UK.
Youthful Papa John’s pair make it a trio
The three new franchises extend the firm’s franchise network to seven, to add to its 13 established across the country. “We are delighted to have welcomed Brown & Illingworth, Wrekin Removals and John Lomas Removals to our already established network of franchises and branches,” said Nigel Bishop, franchise director of Bishop’s Move. “We want them to run their businesses under their own family name in conjunction with our brand.” It certainly sounds like an amicable arrangement all-round.
Here at Elite Business, we love our pizza and young entrepreneur success stories with almost equal weight. Thus, you can imagine our delight upon hearing that the youngest franchisees of Papa John’s – the popular pizza chain – have opened their third store in the space of just eight months. Hitesh Patel and Harry Singh were only 26 years of age when they opened their first Papa John’s outlet back in April and the pair, who have considerable experience in the pizza industry, have now added another Bristol site to their portfolio. “It’s been hard work to get three stores up and running in such a short space of time,” said Patel. “However, it’s also been great fun. You learn a lot about yourself in terms of your strengths and weaknesses. That’s why it’s great to work with my good friend and business partner Harry, as we can be responsible for different tasks and always get the job done.” And it will come as no surprise to hear Patel add: “Our aim is to open even more Papa John’s in the future so watch this space!”
£32,950.00 + VAT
A caring opportunity Since its launch in 2005, Caremark has become synonymous with two things: a great business opportunity and high quality home care. Franchise Fee £32,950 + VAT
t is as true today as it was then, with the society and the community they serve. franchise continuing to attract plenty of Interestingly, the care sector is now interest from high calibre professionals attracting enquiries from overseas business seeking a worthwhile investment. The professionals and domestic high-investment brainchild of Kevin Lewis founder and CEO, entrepreneurs. Having a vision of several years Caremark has continued to grow and develop down the line is essential if franchisees wish to and now has offices throughout the UK, reap the rewards of this high level, long term Ireland and one in Malta. investment. Entrepreneurs certainly need to Having been involved in the Care business have the requisite amount of capital available for the last 25 years, Kevin reflected “I still find to buy a high-level investment franchise, it the most exciting business I have ever been but more important is the need for the right involved in and I’m staggered that I am still as professionals to come into the business, which excited today as I was then”. is why the company is careful in its selection As business opportunities go, Caremark of franchisees for the network. The care has produced a business model which has industry is about people – managing a team remained both relevant and commercial, in and delivering a service to vulnerable clients. spite of the downturn in It is so much more than the economy. Two factors simply owning a multiwhich contribute to this are: million pound business. the model embraces diverse Caremark started 2013 ways of delivering care and at a run, with 4 new support, thus keeping pace franchisees joining the with the changing needs network in January alone, of the public it serves and attracted not only by the secondly, being competitively proven business model, priced it has remained but also by the longevity accessible to a broad range of of the industry into which potential investors. they were investing. Kevin Lewis, Caremark Historically, investors Crucial to the continued wishing to buy a Caremark success of the network is franchise were professionals looking to change the recruitment of the right calibre individual their career or invest funds into another who will have not only a passion for the business. Today, more and more professionals industry, but the requisite drive and ambition are finding themselves looking down the long to grow a substantial business. Certainly, this pipe of possible redundancy and what that is a business opportunity with great potential. will mean for them. Those attracted to the What it is not is a ‘get-rich-quick’ option. The care sector (which has a current annual value success of the business is essentially down to of over £25bn) are also looking for a career the franchisee – there are no guarantees with which will do more than just build a very any business, which is why Caremark is careful profitable business. There is also the need to to select the right franchisees for the network. find a business which will return something to From an investor’s point of view, buying
into a reputable brand is vital. There is also the need for honesty and integrity within the organisation– a culture which must come from the top down. A successful network will demonstrate this ethos and will be a clear indicator that the company operates within a culture of honesty and transparency. Marry this up with strong network support and excellent training for franchisees and their staff and you have a franchise opportunity guaranteed to get a second look.
“I still find it the most exciting business I have ever been involved in”
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Franchise in the spotlight:
Just Falafel 84
Serving up tasty food to the UK market is enough to make people sit up and pay attention. But its commitment to health and social causes makes Just Falafel something truly unique
WORDS: JOSH RUSSELL
e British have rather exacting standards when it comes to food. Not only do we already have a diverse and exacting palate, but our demand for healthy, well-sourced ingredients means that we can be rather cynical about making room for a new restaurant chain in our hearts. However, the increasing appetite for nutritious vegetarian cuisine as well as our preference for brands with a conscience, means that the UK is likely to have a soft spot for a kitchen blending the tasty yet wholesome falafel with flavours from around the globe. Make way for Just Falafel. The franchise began life in Abu Dhabi in 2007 when founder Mohamad Bitar spotted a gap in the market. “Falafel was a traditional street food from Egypt,” explains Mike Biggins, CEO of Just Falafel UK & Ireland. The vast majority of falafel trade in the Emirati city came from street vendors and small independent restaurants. “It was crying out for an entrepreneur to bring some structure to give the customer consistency and give it to them in a comfortable environment.” Unsurprisingly, the store’s first menu item kept things traditional with a classic falafel wrap but Bitar was anything if not adventurous. “He decided to do a Greek version because he wanted something that would appeal to more western tastes,” Biggins says. After a little consideration of his market,
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Bitar realised that it made sense to cater to Abu Dhabi’s substantial Indian population and produced an option specifically targeted to their taste buds. Biggins continues: “As he migrated into Dubai, they realised that this concept of offering different flavours had a lot of attraction.” But it wasn’t just this diversity that started to pull in the punters. “One of the hallmarks that he had from the beginning was ‘fresh, healthy, natural and vegetarian’,” comments Biggins. Before long, Just Falafel’s approach was beginning to bring in more than just customers – Bitar started to get approached by individuals wanting to buy a franchise. “People know this food, they’ve grown up with it, they saw the wisdom of what Mohamad was doing and they wanted to be a part of it.” The franchise has always been heavily involved in the use of social media to spread the brand and currently Just Falafel has over 1.5 million likes on Facebook. “It’s been an important vehicle,” says Biggins. “Through the amount of exposure you get through social media, it started getting inquiries literally from all over the world.” Before long, Just Falafel was in negotiations with UK-based restauranteur Ahmad Hariri, who subsequently bought the rights to open 200 outlets. The first Western store opened in Covent Garden in January 2013, bringing the franchise’s unique approach to falafel to our fair shores. It’s safe to say the UK’s relationship with Just Falafel’s food has been unique. Whilst just 10% of Brits would describe themselves as vegetarian, Biggins points out that we’ve become far more open to meals without meat. “We also find that here in London, people are a little bit bored with the same old same,” he remarks. “You want to have something new, you want to try something different.” And Just Falafel’s approach to the snack is certainly that. Asian cuisine and chickpea patties may not sound like the most obvious combination but the menu doesn’t shy away from using bold combinations of ingredients, as with its Japanese wrap. “It’s got pickled ginger in there,” Biggins explains. “It’s got avocado in there and it has a wasabi mayonnaise.” It’s not just about novelty, however. With recent scandals over meat still fresh in our memories, our old carnivorous habits are under a great deal more scrutiny. “This has
“One of the hallmarks that he had from the beginning was ‘fresh, healthy, natural and vegetarian’”
(H)Franchise spotlight.indd 2
given us a general sense of people paying more attention to their food,” Biggins says. This is something Just Falafel is keen to support any way it can. He continues: “I had our chef, Gerard Murphy, scrub all of our ingredients to ensure there are no artificial colourings, no artificial flavourings – everything is pure and natural.” But beyond having their trust in meat somewhat bruised, people in the UK are far more open to the health benefits of consuming a more varied and nutritious diet. “Part of the beauty of working with our recipe of falafel is that it uses that great vegetable protein and you stay fuller longer,” he comments. “‘Fresh, healthy and natural’ fits in very well.” When a brand positions itself as a ‘healthy alternative’, it’s understandably hard not to allow cynicism to take over and assume this is just lip-service paid to modern trends and demands. But, in Just Falafel’s case, nothing could be further from the truth. “We’re building on people’s awareness of healthy eating habits,” says Biggins. Its conscience is core to its brand; a recent scheme in Dubai is a prime example, where the brand went into local schools to educate the young about rising obesity levels in the city. The franchise is also aligned with the United Nations and the World Hunger Fund, doing its part to redress the number of starving children in developing countries. “For every one of our restaurants that opens, we make a contribution to that fund and we actively promote that in our restaurants and try to raise awareness.” Mike Biggins, Just It’s easy to see why Just Falafel has proved Falafel UK & Ireland an inviting prospect for franchisees: the versatility of the offering is, frankly, merely gravy. “With the ‘fresh, healthy and natural’, we don’t have to worry about major equipment purchases, we have a lot of flexibility on the size of space,” comments Biggins. “We can size the space according to the customer demand. So I think it’s something that’s beginning to demonstrate its appeal for both the first-time franchisee as well as the established franchisee, because it’s got that adaptability.” So what’s next for Just Falafel in Blighty? It seems some big and bright things. Our country has become something of a testing ground, educating the rest of brand on the expectations, concerns and tastes of the average Western consumer. “The UK is our centre of excellence,” says Biggins. “What we’re doing here in the UK is really helping to inform the brand on how to really successfully enter a western market and how to position the brand properly.” And given agreements have already been signed in the United States, Canada and Australia, it seems like the relationship the franchise has with Britain is just the start. Biggins says: “You’re going to start seeing Just Falafel popping up around the globe.”
“We’re building on people’s awareness of healthy eating habits”
(H)Franchise spotlight.indd 3
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We don’t like to think about the worst happening, but, as in one’s personal life, it’s important to have provisions in your will to ensure your business is looked after when you’re gone
In safe hands
WORDS: JOSH RUSSELL
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nderstandably, there’s few things we’re more squeamish about discussing than our own demise. But whilst we’d rather not spend too much time dwelling on our own mortality, it’s more than a little foolish to make no provisions for the future and, whilst we’ve generally grasped this in our personal lives, it is something that tends to get overlooked when people are thinking about the long-term trajectory of their company. The very nature of running your own business can often mean you’re focused more on the day-to-day than pondering the ephemerality of your existence. “Generally people don’t think about it,” explains Rob Martins, wills specialist at provider of accounting, tax and business services Cheesmans Accountants. An entrepreneur’s thoughts are more likely to tend toward the practical than the philosophical. “It’s all business-focused – it’s all about how they can grow, make money, expand the business,” Martins comments. “I’ve met some very successful people who’ve done a lot of good for their businesses because they’ve purely focused on it but, for want of a better phrase, they can sometimes be a bit blinkered by it.” The extent to which not having made firm preparations can affect an organisation might not be immediately appreciable. After all, intestacy law means an individual’s estate is most likely to pass first to their spouse or civil partner and, if not, then divided equally amongst their children. In all likelihood, this will almost certainly closely mirror the deceased’s wishes and it would be tempting to think things are tied up in a neat little bow. Unfortunately, this isn’t the case. “People might say that under the intestacy rules their estate is going exactly where they want it to go,” says Martins. “That’s all well and good but if you’ve not appointed an executor it’s going to take much longer to administer that estate.”
Whilst this might be tricky for surviving relatives, it can be utterly disastrous for an enterprise. Cheesmans has handled cases where – even with sufficient provisions being made in a will – obtaining probate and administering the estate has taken as long as a year. “If there is a business in the background, it can’t wait for a year for that whole process to go through,” Martins comments. Obviously this means it’s smart not to leave any snags that can slow the process even further. Clearly then, making preparations for a stakeholder falling ill or passing away can minimise a lot of the headache and heartache for those left behind. First of all, the functional running of the enterprise needs to be considered. As Martins asks, “In a limited company with two 50 / 50 shareholders, what are you going to do if one of you becomes very ill or passes away?” One of the first protections required would be key person insurance, to cover the financial costs accrued by the incapacity or death of a vital member of an enterprise. “If somebody becomes really ill, you obviously will need somebody to come in and take on their work,” explains Martins. “It’s very rare that one person will be able to carry on and cover everything.” This will help, in part, address some of the issues brought Rob Martins, Cheesmans Accountants up by unexpected illness, impairment or loss of life. But, inevitably, as with the rest of your estate, perhaps the most significant part of crafting a will for your business is deciding who will inherit your stake if you pass away. Controversial though it may sound, Martins recommends you don’t necessarily rush into leaving things to your next of kin. “You then find yourself in that position where the deceased’s siblings or wife is now a shareholder of the company but chances are they’re not going to be aware of the company’s ins and outs,” he says. More importantly, there’s probably little a grieving family member needs less than finding themselves as de facto head of an enterprise. “They’re probably not going to be in any state to assist with the running of the business.” It’s important to remember that in handing over shares in your enterprise, you aren’t necessarily just making provisions for your
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“There needs to be some mechanism in there to allow the company or the shareholder who remains to have the option to purchase those shares”
family’s future: you are also giving them an obligation to actively involve themselves in the running of a potentially sizeable business. For this reason, it’s worth discussing with your potential heir(s) and, if this isn’t a responsibility they’ll want to take on, putting in something imitating pre-emption rights to allow other stakeholders to have first refusal on those shares. “There needs to be some mechanism in there to allow the company or the shareholder who remains to have the option to purchase those shares,” says Martins. “This method preserves serving of the business, whilst the deceased person’s estate gets the money for the shares and they can distribute that accordingly.” Given managing what happens to a business and managing the legacy of a wider estate are certainly interdependent, one might presume they’d be functions of the same set of decisions and the same will-drafting process. However, Martins feels this isn’t necessarily the case. “They are interlinked but I would look at them as two separate variables or matters to consider,” he remarks. Often looking at the legacy of one might encourage an entrepreneur to reflect on that of the other but it is worth considering the needs of your next of kin and the needs of your business in rather separate light. Martins continues, “I always find it a lot easier with clients to say it should be business one side, personal the other.” There’s a perception this process is, by necessity, a rather complicated one and for this reason entrepreneurs may feel like their only choice is to seek the help of a solicitor. But this isn’t necessarily true for owners of micro-businesses that might have comparatively few assets. “On the wills side, you can buy home will kits and I think if you’ve got a small estate, you can probably do that yourself,” comments Martins. “However, professional advice needs to be sought when you’ve got a big estate over the £325,000 nil-rate band limit.” Obviously, having succession plans in place for your business isn’t just about preparing for planned departures. The benefit of including your enterprise in your will is that you know your business, not just your family, are in safe hands.
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the START-UP DIARies
The house that data built Donna Kelly, co-founder, Dressipi
instinct and expertise. In our case we achieved this by getting a stylist who knows the fashion industry and women’s minds inside-out to review and challenge the recommendations and output that our recommendation services gave to users. We quickly realised this could be the solution. The data we were gathering from the women who signed up to use the service was great for improving the components that we knew about, but it didn’t quickly enough identify what we didn’t know, or had not yet thought about. This was more effectively found by the instinct and creativity of a human stylist – which could then be validated and fine-tuned by a cycle of data and stylist. We were so convinced by this
This month, Donna Kelly explains how technology and humans combined forces to build solid foundations at Dressipi
ou need a fertile imagination if you’re going to build a business out of data. That might seem an odd thing to say – surely a business that makes its decisions on data runs by the numbers alone – but data can only take you so far. At some point human judgement and intuition has to take over. That intuition leads you to gather more data, which may challenge or validate your hunch. This then leads to more questions, more data… and the interplay continues as the intuition and the data reinforce each other all the time. This was pretty clear at the very start of Dressipi. To be truly useful, a fashion recommendation service like ours needed to be able to ‘guess’ the taste and style of its users from the data we have available. Now this is a complex and therefore lengthy task. This isn’t just because taste isn’t a rational thing, but also because it can evolve over time or suddenly change because of an external factor. For example, how you normally dress at home may be very different to how you want to dress to attend a particular event like a wedding. So, there were two ways of approaching this. We could wait to gather more and more data knowing that we would find ‘an answer’ eventually – or shortcut the learning cycle by applying some good old fashioned human
approach that we immediately hired a team of stylists: one to sit alongside each one of our programmers and data scientists. Our stylists’ expertise in selecting products and putting outfits together for real women was a revelation. They were able literally to bring our data to life, matching garments and outfits to a range of women in such a way that our algorithms could ‘learn’ very quickly when it was truly appropriate to recommend one style of dress over another. This approach has genuinely allowed us to lessen the gap between the pure algorithm-driven recommendations and real people’s tastes and preferences. So the lesson we learned is that data is great for the ‘what is’ but not always for the ‘what is not yet’. In businesses that are innovating, data is only part of the picture. It is the canvas on which you can design your products and services, but you have to bring the paints.
“Our stylists’ expertise in selecting products and putting outfits together for real women was a revelation”
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We are pleased to announce that Rockstar, the UKâ€™s to provide start up loans and free rockstar mentoring to any start up business over the age of 18. WWW.ROCKSTARSTARTUPLOANS.CO.UK Rockstar FP November.indd 1
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Breaking The Mould