1 00:00:00,891 --> 00:00:01,481 Very good. 2 00:00:01,481 --> 00:00:02,871 All right, well, welcome to the podcast. 3 00:00:02,871 --> 00:00:08,271 And it'd be great if you could start by introducing yourself and telling us a bit 4 00:00:08,271 --> 00:00:11,463 about your business history. 5 00:00:11,790 --> 00:00:16,230 Okay, so my name is Tim Drake and I suppose the most pertinent point is I'm a 6 00:00:16,230 --> 00:00:19,250 semi -retired agency owner. 7 00:00:19,610 --> 00:00:24,930 So in one or two short sentences, borrowed three and a half thousand pounds in the 8 00:00:24,930 --> 00:00:29,370 mid 90s from the Prince's Trust or Prince's Business Youth Trust as it was 9 00:00:29,370 --> 00:00:34,950 then, navigated my small agency, I suppose you'd call it, through various recessions 10 00:00:34,950 --> 00:00:38,894 and reinvented at various times as technologies came out and then was... 11 00:00:38,894 --> 00:00:44,474 lucky enough in 2016 to sell it for £20 million to Interpublic Group. 12 00:00:45,755 --> 00:00:49,415 Well, okay, that sounds very impressive. 13 00:00:49,695 --> 00:00:54,867 Tell me a bit about the agency and what you did and the various pivots you had. 14 00:00:55,214 --> 00:00:59,634 Well, part of it is, you know, I'm 50, or no, 51. 15 00:00:59,634 --> 00:01:02,974 So when I first started in the early 90s, there wasn't the internet. 16 00:01:02,974 --> 00:01:08,814 So it was a graphic design, marketing, advertising type business. 17 00:01:09,694 --> 00:01:14,434 You know, using in the old days of Quark and PageMaker and Freehand and those type 18 00:01:14,434 --> 00:01:14,994 of things. 19 00:01:14,994 --> 00:01:19,214 And then obviously, as time went on, we changed. 20 00:01:19,214 --> 00:01:22,434 We were doing websites in the kind of mid late 90s. 21 00:01:22,814 --> 00:01:24,894 We got into video production. 22 00:01:25,198 --> 00:01:29,198 very high -end creative tech, AR, VR. 23 00:01:29,358 --> 00:01:34,178 When we sold, we'd essentially re -veneered the business as a mobile -first 24 00:01:34,178 --> 00:01:34,838 business. 25 00:01:34,838 --> 00:01:41,358 So from the early 2010s onwards, it was about small form technology, content, 26 00:01:41,358 --> 00:01:42,398 creative. 27 00:01:42,398 --> 00:01:45,668 So when we were bought, we were bought as essentially a mobile business. 28 00:01:45,668 --> 00:01:49,218 So it meant we did build apps and things like that, but also we were doing a lot of 29 00:01:49,218 --> 00:01:52,798 social media and creative for that platform. 30 00:01:54,107 --> 00:01:54,367 Okay. 31 00:01:54,367 --> 00:01:58,847 And from an ownership perspective, were you a hundred percent owner or did you 32 00:01:58,847 --> 00:02:00,163 have a business partner? 33 00:02:01,006 --> 00:02:04,086 I think this could be the key point of this conversation. 34 00:02:04,086 --> 00:02:09,266 So to keep things simple, for many years I was the sole owner. 35 00:02:09,406 --> 00:02:12,586 My business was called Flipside Group and the reason it was called Flipside Group 36 00:02:12,586 --> 00:02:16,906 was I had loads of little other little businesses like Flipside Digital Signage. 37 00:02:16,906 --> 00:02:20,906 And that was my method to ingest partners into businesses where they had specific 38 00:02:20,906 --> 00:02:22,246 skill sets. 39 00:02:22,862 --> 00:02:28,022 It really wasn't till I merged them all together, essentially lost all the people 40 00:02:28,022 --> 00:02:33,762 that were really not performing and finally met someone that was very similar 41 00:02:33,762 --> 00:02:37,102 to me, cut from the same bit of wood but a different end. 42 00:02:37,102 --> 00:02:42,622 We got together in 2012 and that's when we really focused on building and selling. 43 00:02:42,762 --> 00:02:44,722 And it was a ruthless focus. 44 00:02:45,563 --> 00:02:46,243 Okay. 45 00:02:46,243 --> 00:02:47,103 Okay. 46 00:02:47,103 --> 00:02:53,682 And then so what kind of size was the business in 2015, 2016 in terms of number 47 00:02:53,682 --> 00:02:56,079 of employees and revenue? 48 00:02:56,558 --> 00:02:58,698 We're not massive actually. 49 00:02:58,838 --> 00:03:01,958 We got a high multiple because of the error we were in, but we were probably 50 00:03:01,958 --> 00:03:05,298 around about 25 employees. 51 00:03:05,298 --> 00:03:09,898 We had a good network of contractors and freelancers as well, but essentially 25 52 00:03:09,898 --> 00:03:11,198 core employees. 53 00:03:11,198 --> 00:03:18,678 And we were probably turning over about 2 .5 million, 3 million at that point. 54 00:03:18,678 --> 00:03:23,618 The significant thing was when we sold in 2016, our trajectory was showing that we'd 55 00:03:23,618 --> 00:03:25,774 make a million pounds EBITDA. 56 00:03:25,774 --> 00:03:30,114 which in those days was the core metric for an acquisition from a big corporate. 57 00:03:30,114 --> 00:03:33,084 That's actually now higher, but that was it really. 58 00:03:33,084 --> 00:03:38,734 They weren't that bothered about anything other than the profitability and the 59 00:03:38,734 --> 00:03:40,514 actual output of the agency. 60 00:03:42,459 --> 00:03:46,931 So that sounds like a massive multiple that you managed to achieve there. 61 00:03:47,506 --> 00:03:50,646 well, it was a six year earn out. 62 00:03:50,846 --> 00:03:55,036 Well, you know, our base year was 2015 and the earn out didn't end until 2021. 63 00:03:55,036 --> 00:03:57,266 And this is probably quite a salient point. 64 00:03:57,266 --> 00:04:02,326 My business partner, who I went on the last kind of 10 year journey with, had 65 00:04:02,326 --> 00:04:06,006 previously sold an agency to Edelman, the big PR firm. 66 00:04:06,706 --> 00:04:08,334 And... 67 00:04:08,334 --> 00:04:12,474 What him and I both understood is that we really needed to be a remora fish on a 68 00:04:12,474 --> 00:04:15,274 bigger business to be able to grow rapidly. 69 00:04:15,274 --> 00:04:19,154 And essentially what we did is we sold the business with a built -in buyer who were 70 00:04:19,154 --> 00:04:22,314 essentially offering us a new business channel as well. 71 00:04:22,314 --> 00:04:29,834 As it happened in the end, only 25 % of our turnover came from the network itself, 72 00:04:29,834 --> 00:04:30,674 from IPG itself. 73 00:04:30,674 --> 00:04:33,194 All the rest just came via our normal connections. 74 00:04:33,194 --> 00:04:34,854 I think it just gave us the punch up. 75 00:04:34,854 --> 00:04:36,814 And to give you an idea then, 76 00:04:37,038 --> 00:04:43,398 We grew and when I left at the end of 2021 with the OnOut finished we were doing 77 00:04:43,398 --> 00:04:50,718 about £20 million revenue a year, give or take. 78 00:04:52,078 --> 00:04:59,238 Yeah, but also what was interesting is that we were doing in excess of, when I 79 00:04:59,238 --> 00:05:03,138 say total, I mean net revenue, so that is fees and commission. 80 00:05:03,246 --> 00:05:05,066 So that's net revenue. 81 00:05:05,786 --> 00:05:08,146 So I'll tell you a slightly more than that. 82 00:05:08,146 --> 00:05:16,726 And we were doing about, and I'm going to swap to dollars here, $900 ,000 profit a 83 00:05:16,726 --> 00:05:17,666 month. 84 00:05:20,046 --> 00:05:22,086 So it was big. 85 00:05:22,686 --> 00:05:25,206 I can go into detail about the earn out structure. 86 00:05:25,206 --> 00:05:30,566 They're quite similar in the corporate America and corporate world in general. 87 00:05:30,566 --> 00:05:36,726 They tend to give you your multiple is based on your growth rate, your CAGR and 88 00:05:36,726 --> 00:05:37,646 also your profitability. 89 00:05:37,646 --> 00:05:39,426 So you can't grow. 90 00:05:39,438 --> 00:05:43,778 at the expense of profitability and you can't stay profitable at the expense of 91 00:05:43,778 --> 00:05:44,598 growth. 92 00:05:44,598 --> 00:05:48,178 So it was a combination of both those items that gave us our maximum multiple, 93 00:05:48,178 --> 00:05:48,958 which was eight. 94 00:05:48,958 --> 00:05:55,178 And I'm tremendously proud to say that we actually, I don't believe that IPG had had 95 00:05:55,178 --> 00:06:00,978 anyone hit their run out cap in 15 years and we actually went 20 million pounds 96 00:06:00,978 --> 00:06:02,358 through the cap. 97 00:06:02,358 --> 00:06:05,838 And we actually ended our run out early. 98 00:06:06,098 --> 00:06:08,638 How we did that is probably, 99 00:06:08,718 --> 00:06:12,638 conversation for many other podcasts or directly with some of your listeners but I 100 00:06:12,638 --> 00:06:15,462 can definitely delve into that if needed now. 101 00:06:16,475 --> 00:06:21,585 So, just taking a bit of a step back then, I guess, how did the sale come about? 102 00:06:21,585 --> 00:06:25,979 Were you actively looking for a buyer or were you approached? 103 00:06:26,510 --> 00:06:30,650 Well, I think what everyone's really got to understand, and I think everyone 104 00:06:30,650 --> 00:06:34,890 empathizes on who are listening to this, is that you never get rich from running an 105 00:06:34,890 --> 00:06:35,830 agency. 106 00:06:36,070 --> 00:06:39,630 So I'd got through another recession. 107 00:06:39,630 --> 00:06:41,270 So that was the banking recession. 108 00:06:41,270 --> 00:06:45,010 Just as the kids were born in 2010 had twins, and I thought, I've just got to 109 00:06:45,010 --> 00:06:45,550 sell this thing. 110 00:06:45,550 --> 00:06:46,900 I've got to build it and sell it. 111 00:06:46,900 --> 00:06:51,070 I had a very specific eye on the prize or what I wanted to do and how I was going to 112 00:06:51,070 --> 00:06:52,510 do it. 113 00:06:53,166 --> 00:06:59,502 And then we had a partner came in who knew exactly what to do. 114 00:06:59,502 --> 00:07:02,342 and you had done it before. 115 00:07:02,882 --> 00:07:07,541 We roughly focused on getting to the size that was going to make us sexy, which was 116 00:07:07,541 --> 00:07:13,082 that one million pound EBITDA, started going to market and talking to people well 117 00:07:13,082 --> 00:07:15,652 before because you've got to get the hockey stick at the right point. 118 00:07:15,652 --> 00:07:19,772 So if you go too late, you've got to keep the growth going during the negotiations. 119 00:07:19,772 --> 00:07:21,822 Otherwise it can be a bit challenging. 120 00:07:22,142 --> 00:07:25,422 And then what we also did is we just looked at the market and understood what 121 00:07:25,422 --> 00:07:26,710 people were buying. 122 00:07:26,926 --> 00:07:31,766 And in that particular time, people were desperately trying to get into mobile, 123 00:07:31,766 --> 00:07:35,946 didn't have the competency, even the big networks weren't trusted by clients to 124 00:07:35,946 --> 00:07:38,406 really grasp this emerging technology. 125 00:07:38,406 --> 00:07:42,406 And we were able to re -describe much of our turnover as mobile first, when in fact 126 00:07:42,406 --> 00:07:44,546 actually we were just a digital agency. 127 00:07:44,546 --> 00:07:51,486 So it was a combination of size scale, experience of the management and actually 128 00:07:51,486 --> 00:07:54,066 what people were buying at the time. 129 00:07:54,907 --> 00:07:55,687 OK. 130 00:07:55,687 --> 00:07:56,107 OK. 131 00:07:56,107 --> 00:07:59,213 And then so, yeah. 132 00:07:59,430 --> 00:08:03,050 sorry, to answer the second part of your question, we had some initial 133 00:08:03,050 --> 00:08:03,720 conversations. 134 00:08:03,720 --> 00:08:05,830 We didn't use an &A's company. 135 00:08:05,830 --> 00:08:07,170 I did all the &A's myself. 136 00:08:07,170 --> 00:08:13,710 We had an introducer that got us involved, got us in front of a few different people, 137 00:08:13,930 --> 00:08:16,830 obviously all the big names as you would expect. 138 00:08:18,010 --> 00:08:19,270 We... 139 00:08:19,406 --> 00:08:24,306 pursued one and they decided to try and in -source our function, failed. 140 00:08:24,306 --> 00:08:27,266 So when they came back to us nine months later, they were on the back foot and it 141 00:08:27,266 --> 00:08:29,326 was then that we eventually sold it. 142 00:08:31,163 --> 00:08:32,043 Okay. 143 00:08:32,043 --> 00:08:39,202 And I was sort of interested in like how those negotiations went and sort of how 144 00:08:39,202 --> 00:08:43,057 they structured the deal and how you agreed evaluation. 145 00:08:44,078 --> 00:08:47,898 Yeah, well, I mean, obviously, IPG are on the New York Stock Exchange, so everything 146 00:08:47,898 --> 00:08:49,548 is in the public domain. 147 00:08:49,548 --> 00:08:51,598 So I will speak fairly openly. 148 00:08:51,918 --> 00:08:55,678 I mean, essentially, once you meet the right criteria, they have a strategic 149 00:08:55,678 --> 00:08:56,648 requirement for you. 150 00:08:56,648 --> 00:09:00,318 In our case, it was mobile and that you were of a size. 151 00:09:00,818 --> 00:09:05,958 Then a lot of people use an &A's company, they'll use a counter to something. 152 00:09:05,958 --> 00:09:09,658 But because I was quite an experienced businessman, I was actually able to do the 153 00:09:09,658 --> 00:09:13,538 &A's myself, which gives me a rather unique perspective into the process. 154 00:09:13,538 --> 00:09:14,284 And in fact, 155 00:09:14,284 --> 00:09:19,744 excuse my my language now but I remember the head of &A's IPG rung up the global 156 00:09:19,744 --> 00:09:25,784 CFO of Webber who were the strategic buyer of us saying this Tim Drake only fucking 157 00:09:25,784 --> 00:09:29,924 runs the business because they're just not used to having agency owners who genuinely 158 00:09:29,924 --> 00:09:31,604 understand business. 159 00:09:32,204 --> 00:09:37,504 So the process was quite interesting and I think the hardest thing was was pushing 160 00:09:37,504 --> 00:09:40,366 for a better deal when the money on the table was so much 161 00:09:40,366 --> 00:09:44,586 When you're a small business owner and you've been fighting for month after month 162 00:09:44,586 --> 00:09:49,806 to pay the wages and all this, making modest profits for yourself, always having 163 00:09:49,806 --> 00:09:51,266 a lot of risk in the business. 164 00:09:51,266 --> 00:09:54,886 When those numbers start coming in, it's very easy to snatch it straight off the 165 00:09:54,886 --> 00:09:55,566 table. 166 00:09:55,566 --> 00:09:57,746 So in our case, it was a very long earn out. 167 00:09:57,746 --> 00:10:03,246 They offered us a multiple between five and eight depending on our performance. 168 00:10:04,718 --> 00:10:09,258 the combination of Kanga and profitability during the earn out period. 169 00:10:09,658 --> 00:10:14,458 They offered us some money upfront and some money at the end. 170 00:10:14,458 --> 00:10:17,538 And because the earn out was so long, we said, well, that's simply not enough. 171 00:10:17,538 --> 00:10:20,398 So we'll need to have two separate payments in the middle. 172 00:10:20,398 --> 00:10:23,398 Those payments in the middle were capped. 173 00:10:23,398 --> 00:10:25,348 So we can never earn that much in those payments. 174 00:10:25,348 --> 00:10:29,538 So that the last payment at the end of the earn out was exponentially higher. 175 00:10:29,538 --> 00:10:31,498 So it allowed us to catch up. 176 00:10:31,694 --> 00:10:36,734 And because the deal was an average of our profitability times are multiple over a 177 00:10:36,734 --> 00:10:39,813 period of time, it meant that we could have some ebbs and flows in performance 178 00:10:39,813 --> 00:10:40,914 from year to year. 179 00:10:40,914 --> 00:10:44,934 As it happened, we didn't need that. 180 00:10:44,974 --> 00:10:51,274 But it was, I think the interesting things were it wasn't difficult getting them to 181 00:10:51,274 --> 00:10:52,174 pay more. 182 00:10:52,174 --> 00:10:55,454 because they had the strategic requirement, because they tried to 183 00:10:55,454 --> 00:10:58,774 insource it so their need state was heightened. 184 00:10:58,774 --> 00:11:04,014 The interesting thing was more dealing within the confines of a corporate body 185 00:11:04,014 --> 00:11:07,214 where it's not like dealing with people like you and me, business owners, where 186 00:11:07,214 --> 00:11:09,774 we're making judgments, objectivity, subjective judgments. 187 00:11:09,774 --> 00:11:11,714 They literally, as the computer says, no. 188 00:11:11,714 --> 00:11:15,364 If their corporate policy say no, then you have to find ways around it. 189 00:11:15,364 --> 00:11:17,294 And certainly, 190 00:11:17,294 --> 00:11:21,353 when they came to put, when you do the deal, you know they're going to put loads 191 00:11:21,353 --> 00:11:22,874 of corporate expenses on you. 192 00:11:22,874 --> 00:11:27,014 So one of the most significant parts of what we were doing was actually how do 193 00:11:27,014 --> 00:11:27,954 those come in? 194 00:11:27,954 --> 00:11:29,374 How are they restricted? 195 00:11:29,374 --> 00:11:31,794 How can we prevent them putting too much cost on us? 196 00:11:31,794 --> 00:11:33,954 In our case, the deal was long. 197 00:11:33,954 --> 00:11:39,074 So it meant I was able to negotiate them not charging us any corporate IT expenses 198 00:11:39,074 --> 00:11:44,974 and other expenses for a year or so into the deal, which in hindsight, when you're 199 00:11:44,974 --> 00:11:47,144 times you buy multiple can make a lot of money. 200 00:11:47,931 --> 00:11:49,001 Yeah, yeah. 201 00:11:49,001 --> 00:11:52,911 And I guess, because they're publicly listed, and I don't know what multiple 202 00:11:52,911 --> 00:11:56,191 they were trading at, but presumably above 10. 203 00:11:56,551 --> 00:11:59,721 Then that then informs the multiples they can offer. 204 00:11:59,721 --> 00:12:00,627 Sorry. 205 00:12:00,874 --> 00:12:06,414 Well you're precisely, precisely, I mean as you imagine five to eight, if all 206 00:12:06,414 --> 00:12:08,206 profitability wrapped into their... 207 00:12:08,206 --> 00:12:11,686 their kind of corporate wrapper suddenly makes it a 14 multiple. 208 00:12:11,686 --> 00:12:13,466 So they can't really lose. 209 00:12:13,466 --> 00:12:18,766 And when you do the maths, what you work out is they only pay you the money you've 210 00:12:18,766 --> 00:12:19,796 made them during that period. 211 00:12:19,796 --> 00:12:22,386 They pay you the profit you've made during that period. 212 00:12:23,106 --> 00:12:26,576 But as we all know, as business owners, it's difficult to ever release it. 213 00:12:26,576 --> 00:12:30,006 The liquidity is tied up in cash flow and all sorts of things. 214 00:12:30,166 --> 00:12:35,146 So, yes, I mean, and as I said, I boasted at the beginning about we went so far 215 00:12:35,146 --> 00:12:36,398 through our cap. 216 00:12:36,398 --> 00:12:42,058 So the story for me now, when I talk to other agencies and help them with other 217 00:12:42,058 --> 00:12:45,298 potential buyers, is that I've been there and actually it was such a tremendously 218 00:12:45,298 --> 00:12:50,218 good value deal for the acquirer as well as for us the seller. 219 00:12:52,283 --> 00:12:57,283 Talk to me a little bit about the CAGAR, the compound annual growth rate and that 220 00:12:57,283 --> 00:13:02,881 mechanism, because I'm not that familiar with how that works. 221 00:13:03,042 --> 00:13:08,602 obviously when you sell your business and you're in an earn out the better the 222 00:13:08,602 --> 00:13:14,462 profitability of the business the more money you get and then depending on the 223 00:13:14,462 --> 00:13:20,502 metrics by which you grow and perform the the multiple is increased so in our case 224 00:13:20,502 --> 00:13:25,518 it's CAGR so CAGR is Compound Annual Growth Rate so that basically means 225 00:13:25,518 --> 00:13:32,498 To get on maximum, we needed to average a minimum of 25 % growth year on year 226 00:13:32,498 --> 00:13:33,978 through the whole space of the year. 227 00:13:33,978 --> 00:13:37,918 So you can imagine that's why we had to grow so quickly because 25 % one year, 228 00:13:37,918 --> 00:13:40,978 then 25 % on top of that, it's compounding. 229 00:13:41,178 --> 00:13:43,298 So they have that, that's compound annual growth rate. 230 00:13:43,298 --> 00:13:46,278 So you just need to sell more stuff, right? 231 00:13:46,638 --> 00:13:49,678 Then they times dip by... 232 00:13:49,678 --> 00:13:52,078 they called it, essentially it was a margin payment. 233 00:13:52,078 --> 00:13:54,458 So it was the profitability over net revenue. 234 00:13:54,458 --> 00:13:57,098 And that again needed to be north of 25%. 235 00:13:57,098 --> 00:14:02,118 Now, having run a business for a couple of decades before I sold, the thought of 236 00:14:02,118 --> 00:14:07,038 having an agency that's making 25 % profit is just mind blowing. 237 00:14:07,038 --> 00:14:11,298 But you'd be surprised when you once you get into the right rhythm, and you 238 00:14:11,298 --> 00:14:14,778 certainly get access to the right kind of clients is very achievable. 239 00:14:14,778 --> 00:14:17,980 So in our case, to get the maximum, 240 00:14:18,158 --> 00:14:24,218 multiple we needed to be north of 25 % compound annual growth rate and north of 241 00:14:24,218 --> 00:14:28,618 25 % net profit. 242 00:14:28,618 --> 00:14:32,238 Now the point about that is though is it's an average over the space of the year so 243 00:14:32,238 --> 00:14:36,118 if you have a slight dip one year you can catch up the next year. 244 00:14:36,118 --> 00:14:41,278 Which is one of the benefits of having a longer 245 00:14:41,902 --> 00:14:45,302 sometimes you might think that's a bit too much so I'll have a smaller run out but if 246 00:14:45,302 --> 00:14:48,982 we'd had a shorter run out the the final end figure would have been smaller as 247 00:14:48,982 --> 00:14:50,288 well. 248 00:14:51,419 --> 00:14:53,319 I mean, those are impressive numbers. 249 00:14:53,319 --> 00:14:58,119 And I think numbers that lots of agency owners would, you know, would love to 250 00:14:58,119 --> 00:15:03,819 have, you know, 25 % net profit and 25 % you know, compound annual growth is huge. 251 00:15:03,819 --> 00:15:07,123 Like, how did you how did you manage to achieve that? 252 00:15:07,182 --> 00:15:10,742 Well, first of all, let me give everyone a bit of confidence because we actually did 253 00:15:10,742 --> 00:15:12,602 considerably more than that. 254 00:15:12,702 --> 00:15:16,122 I mean, I think we literally had the Americans flying over because they 255 00:15:16,122 --> 00:15:21,622 couldn't understand we were making 35, often 40 % profit. 256 00:15:23,522 --> 00:15:30,162 First of all, it's interesting, if you sell a business and you've got some money 257 00:15:30,162 --> 00:15:34,842 in the bank, you're apt to take to risk changes and you become a lot more outgoing 258 00:15:34,842 --> 00:15:36,486 from a sales perspective. 259 00:15:36,558 --> 00:15:39,558 you get a lot more help when you're in those kind of environments in the 260 00:15:39,558 --> 00:15:40,398 corporate structure. 261 00:15:40,398 --> 00:15:46,658 So, and we had a business model, which was specific. 262 00:15:46,658 --> 00:15:48,278 Is it repeatable now is a big question. 263 00:15:48,278 --> 00:15:52,398 I'm not too sure, but essentially we front loaded the business full of people that 264 00:15:52,398 --> 00:15:55,978 were everyone was an A and 18 player, fantastic group of people. 265 00:15:55,978 --> 00:15:56,708 Absolutely wonderful. 266 00:15:56,708 --> 00:16:01,098 I mean, everyone, I mean, we were ruthless about getting rid of people that weren't 267 00:16:01,098 --> 00:16:04,818 up to it, but those that were really, really were good. 268 00:16:04,818 --> 00:16:06,884 And it was much about their attitude as well. 269 00:16:06,884 --> 00:16:07,744 else. 270 00:16:07,744 --> 00:16:14,764 Now they, so essentially we fill the business full of people who faced off to 271 00:16:14,764 --> 00:16:15,134 clients. 272 00:16:15,134 --> 00:16:18,524 So we sold strategy and creative. 273 00:16:18,524 --> 00:16:21,724 So we had lots of creatives, lots of strategy, but we make money cutting code 274 00:16:21,724 --> 00:16:24,844 and we outsourced all of the code cutting. 275 00:16:25,944 --> 00:16:31,264 So what we did essentially because we were building big apps, big websites and all 276 00:16:31,264 --> 00:16:34,084 these kind of digital platforms, we were able to front load the business with the 277 00:16:34,084 --> 00:16:35,835 kind of people that won the work. 278 00:16:36,110 --> 00:16:40,850 And then we were able to cut a statement of works for the project delivery. 279 00:16:40,850 --> 00:16:44,770 We essentially sold that to one of our suppliers for a third of that price. 280 00:16:44,770 --> 00:16:47,600 And we had a baked in piece of profit there. 281 00:16:47,600 --> 00:16:51,230 So we were making 300 % margin essentially on that. 282 00:16:51,230 --> 00:16:55,850 And then we had brilliant project managers who's been ensure that there was no scope 283 00:16:55,850 --> 00:16:56,790 creep. 284 00:16:57,006 --> 00:17:00,116 And if there was GoCreek, the price went up and the time went up. 285 00:17:00,116 --> 00:17:02,626 So we managed that bit, which meant that the people at the front of the business 286 00:17:02,626 --> 00:17:04,266 could quickly move on to a more business. 287 00:17:04,266 --> 00:17:06,766 We had no account management or account direction. 288 00:17:06,766 --> 00:17:10,026 We described them all as digital strategists than they were. 289 00:17:10,026 --> 00:17:11,546 And that was a real difference. 290 00:17:11,546 --> 00:17:13,796 So whether that model could exist now, I'm not too sure. 291 00:17:13,796 --> 00:17:19,626 I mean, obviously costs, we were consuming huge amounts of labor from Europe, 292 00:17:19,626 --> 00:17:22,706 particularly Ukraine and those kinds of places and Poland. 293 00:17:22,830 --> 00:17:27,330 But the whole, it's all changed a bit now, hasn't it, with the cost of acquiring 294 00:17:27,330 --> 00:17:29,170 support from over there. 295 00:17:29,170 --> 00:17:31,100 But that's essentially how we did it. 296 00:17:31,100 --> 00:17:35,710 If we had insourced absolutely everyone who was doing the work, we no way could 297 00:17:35,710 --> 00:17:36,730 have made margin. 298 00:17:36,730 --> 00:17:40,690 And also, by outsourcing, let me just clarify something. 299 00:17:40,690 --> 00:17:44,270 There was nothing that we outsourced that we couldn't do in -house, but we didn't 300 00:17:44,270 --> 00:17:45,490 have all the bricklayers. 301 00:17:45,490 --> 00:17:47,700 We didn't have 50 iOS developers. 302 00:17:47,700 --> 00:17:49,150 We didn't need them, right? 303 00:17:49,150 --> 00:17:52,784 But we had three or four absolute rock stars who were able to, 304 00:17:52,784 --> 00:17:55,684 to face off the client to then manage the backend. 305 00:17:56,944 --> 00:18:02,144 And the one thing about that model is that we have a hundred percent utilization. 306 00:18:03,484 --> 00:18:06,478 I for years had... 307 00:18:06,478 --> 00:18:13,318 iOS developers in -house and PHP and then I had compiled language dot net people, I 308 00:18:13,318 --> 00:18:15,858 had videographers, I had everything so that we could deliver everything in -house 309 00:18:15,858 --> 00:18:19,918 but you're permanently trying to sell the capacity you've got rather than trying to 310 00:18:19,918 --> 00:18:24,298 sell what the client wants and we just did that and in the end all the clients were 311 00:18:24,298 --> 00:18:29,618 really interested in was the creativity or rather the strategy, the creativity, one 312 00:18:29,618 --> 00:18:33,498 throat to choke, they didn't care where it was made they just wanted to make sure it 313 00:18:33,498 --> 00:18:36,432 was absolutely brilliant and the people we have, the clients facing 314 00:18:36,432 --> 00:18:40,652 to work fantastic and were very good at winning new business and building long 315 00:18:40,652 --> 00:18:41,912 -term relationships. 316 00:18:41,912 --> 00:18:46,072 So that was our business model and that was what afforded us the luxury of that 317 00:18:46,072 --> 00:18:47,232 kind of profit. 318 00:18:47,867 --> 00:18:50,867 Okay, yeah, very, very impressive. 319 00:18:51,347 --> 00:18:54,167 How did the integration go? 320 00:18:54,167 --> 00:18:57,506 How did things change after you'd sold the business? 321 00:18:57,506 --> 00:19:04,086 Well, the second part why we were so successful is we retained that kind of 322 00:19:04,086 --> 00:19:06,586 small business agile mentality. 323 00:19:07,346 --> 00:19:10,566 You know, we would regularly say to the big American bosses, you give us $100 324 00:19:10,566 --> 00:19:13,896 worth of profit, we'll give you $35 back in. 325 00:19:13,896 --> 00:19:18,106 So you give us $100 of revenue, we'll give you $35 back in profit. 326 00:19:18,106 --> 00:19:23,986 And what we did find is that in the six years we were there, we never had a board 327 00:19:23,986 --> 00:19:24,706 meeting. 328 00:19:24,706 --> 00:19:27,118 So they had lots of their people on our board. 329 00:19:27,118 --> 00:19:30,718 And what you will find is if you're doing really well, they'll just leave you alone. 330 00:19:30,718 --> 00:19:33,978 And rather interesting that they seem to spend all of their time trying to fix 331 00:19:33,978 --> 00:19:37,038 businesses that weren't performing rather than do more of the stuff that was 332 00:19:37,038 --> 00:19:41,718 performing, which is just a little bit of insight there from me. 333 00:19:42,398 --> 00:19:45,918 So when it comes to, so first of all, if you're successful in your own health, 334 00:19:45,918 --> 00:19:46,568 they'll leave you alone. 335 00:19:46,568 --> 00:19:48,158 That's the first thing to remember. 336 00:19:48,158 --> 00:19:54,598 Secondly, Marcus, my business partner in particular, was extremely brilliant at 337 00:19:54,598 --> 00:19:55,962 maintaining culture. 338 00:19:56,206 --> 00:20:02,146 to the extent that one weekend we moved all the desks out from our end of this 339 00:20:02,146 --> 00:20:04,326 corporate office and moved all our own furniture in. 340 00:20:04,326 --> 00:20:08,286 So we were permanently a little bit antagonistic, stood out from the rest of 341 00:20:08,286 --> 00:20:09,026 them and all this type of thing. 342 00:20:09,026 --> 00:20:10,566 So we maintained that. 343 00:20:11,106 --> 00:20:13,546 We had a good culture. 344 00:20:13,546 --> 00:20:17,466 And I think probably the real difference between how we behaved and how they 345 00:20:17,466 --> 00:20:21,106 behaved is that every Friday morning we would have a sales call essentially where 346 00:20:21,106 --> 00:20:22,196 everyone would talk about the work. 347 00:20:22,196 --> 00:20:22,894 They would... 348 00:20:22,894 --> 00:20:28,594 pitching for and doing and we probably had 35 % of the entire business was on that 349 00:20:28,594 --> 00:20:29,474 call. 350 00:20:30,094 --> 00:20:33,834 So rather than the corporates culturally having two or three people responsible for 351 00:20:33,834 --> 00:20:36,354 sale and hundreds of people there for delivery, we were quite the other way 352 00:20:36,354 --> 00:20:37,154 around. 353 00:20:37,154 --> 00:20:42,074 But people were, they were writing the theme tune, singing the theme tune the 354 00:20:42,074 --> 00:20:43,214 whole lot. 355 00:20:43,654 --> 00:20:47,944 So, and we never had again, very different to Big Corporate. 356 00:20:47,944 --> 00:20:51,114 Well, we didn't have that heavyweight pitch junior delivery model. 357 00:20:51,374 --> 00:20:53,147 which clients liked. 358 00:20:53,147 --> 00:20:54,167 Okay. 359 00:20:54,167 --> 00:20:59,727 So, and then you then left the business in 2021. 360 00:20:59,727 --> 00:21:04,287 So was that at the end of your earn out or did you stay on a bit after the earn out 361 00:21:04,287 --> 00:21:05,043 finished? 362 00:21:05,043 --> 00:21:07,653 no, the, well, we were lucky actually. 363 00:21:07,653 --> 00:21:12,003 As I said, we were very fortunate to get them to agree that the year now had been 364 00:21:12,003 --> 00:21:16,603 completed early, which meant that I was able to hand my notice in, which I had six 365 00:21:16,603 --> 00:21:21,326 months notice halfway through the year before, halfway through 2021. 366 00:21:21,326 --> 00:21:25,126 which really in those worlds you become almost excommunicated. 367 00:21:25,126 --> 00:21:27,966 But because they'd agreed it was all done, there was no point in me staying on. 368 00:21:27,966 --> 00:21:36,606 So I left, previous to me leaving, my CTO had been with me for decades left as well. 369 00:21:36,606 --> 00:21:39,346 And my other business partner Marcus remained in the business and still remains 370 00:21:39,346 --> 00:21:41,125 there now as the leader. 371 00:21:42,406 --> 00:21:43,846 So, and as Betty do. 372 00:21:43,846 --> 00:21:47,466 But it was for me, I knew what I wanted. 373 00:21:47,790 --> 00:21:49,610 and I knew I had to leave. 374 00:21:49,610 --> 00:21:54,130 And that ruthless focus on the number I wanted to take away from the deal and when 375 00:21:54,130 --> 00:21:59,050 I wanted to do it meant that every single decision through that, every hard day, 376 00:21:59,050 --> 00:22:03,530 every flight around different time zones, every sleepless night, all came back to, 377 00:22:03,530 --> 00:22:05,370 is it answering that goal? 378 00:22:05,510 --> 00:22:06,890 And it did. 379 00:22:07,163 --> 00:22:13,413 And what was it like for you leaving after such a long time and such a wild ride? 380 00:22:13,413 --> 00:22:14,899 How did it feel? 381 00:22:15,694 --> 00:22:17,394 That's a great question. 382 00:22:17,574 --> 00:22:20,994 I think I understood that I was always more in love with the business than the 383 00:22:20,994 --> 00:22:21,934 craft. 384 00:22:21,934 --> 00:22:23,174 That was the thing. 385 00:22:23,174 --> 00:22:26,954 I mean, I've spent tens of thousands of hours on Macs in reality over the years, 386 00:22:26,954 --> 00:22:28,774 but really I was a businessman at heart. 387 00:22:28,774 --> 00:22:30,014 I did have other businesses. 388 00:22:30,014 --> 00:22:34,514 It was only until I got rid of all of those and focused purely on the flip side 389 00:22:34,514 --> 00:22:37,474 of the business I sold that it really became successful. 390 00:22:38,158 --> 00:22:42,338 So, you know, when I left, I was more than ready to leave. 391 00:22:42,358 --> 00:22:43,688 I mean, it was a process as well. 392 00:22:43,688 --> 00:22:45,898 You think that it was a six year earn out. 393 00:22:45,898 --> 00:22:50,498 Yeah, let's say it was a year, 18 month buying cycle and you've got to get a good 394 00:22:50,498 --> 00:22:53,128 two year run up so that you've reimagined your business. 395 00:22:53,128 --> 00:22:54,478 You've got all the metrics in place. 396 00:22:54,478 --> 00:22:55,598 You've normalized your accounts. 397 00:22:55,598 --> 00:22:56,498 You're ready to go. 398 00:22:56,498 --> 00:22:58,018 So you're talking from the moment you make right. 399 00:22:58,018 --> 00:23:00,978 That's it with going to the moment of what's up is 10 years near enough. 400 00:23:00,978 --> 00:23:02,518 It's a long, long time. 401 00:23:02,518 --> 00:23:04,918 So it was very, very ready to go. 402 00:23:04,918 --> 00:23:08,484 And also, you know, I, I, 403 00:23:08,484 --> 00:23:10,984 was able to go and never have to work again. 404 00:23:11,144 --> 00:23:12,484 So that's a bit different. 405 00:23:12,484 --> 00:23:17,924 I mean, I think that a lot of my peers who'd sold their businesses into IPG and 406 00:23:17,924 --> 00:23:21,594 others during similar times hadn't maximized their own out. 407 00:23:21,594 --> 00:23:23,204 In some cases, I haven't got anywhere near it. 408 00:23:23,204 --> 00:23:24,864 And therefore they had to continue to work. 409 00:23:24,864 --> 00:23:29,764 And it wasn't quite the dream come true, the exit, the perfect exit, which was 410 00:23:29,764 --> 00:23:30,484 essentially mine. 411 00:23:30,484 --> 00:23:33,824 But I think looking back, I've always realized I wanted to do absolutely 412 00:23:33,824 --> 00:23:34,844 nothing. 413 00:23:35,726 --> 00:23:37,766 I'm the chairman of a new agency. 414 00:23:38,466 --> 00:23:40,066 Well, do you know what? 415 00:23:40,066 --> 00:23:45,146 I mean, I think I don't want to boast because that's not really what I'm like, 416 00:23:45,146 --> 00:23:51,206 but I just want people listening there who are running little businesses, that they 417 00:23:51,206 --> 00:23:52,656 can make money, they can be sold. 418 00:23:52,656 --> 00:23:56,106 I never thought marketing services businesses could make money and I made 419 00:23:56,106 --> 00:23:56,316 them. 420 00:23:56,316 --> 00:23:58,716 So what I'm about to say is purely for that person. 421 00:23:58,716 --> 00:24:03,166 So what I do is I look after my 18 cars, my four motorbikes and my manor house in 422 00:24:03,166 --> 00:24:04,286 the country. 423 00:24:04,302 --> 00:24:05,522 That's what I do. 424 00:24:05,522 --> 00:24:10,722 I'm also a chairman of another agency, a little agency for some of the ex flip side 425 00:24:10,722 --> 00:24:12,352 people in it who I wanted. 426 00:24:12,352 --> 00:24:13,842 It's their time to be in the sun. 427 00:24:13,842 --> 00:24:18,742 So I have a mod of shareholding and do some sort of sales essentially for them. 428 00:24:19,142 --> 00:24:22,282 But I mean, just before I've come with this call, I've just been mowing my garden 429 00:24:22,282 --> 00:24:24,262 and it's a big garden. 430 00:24:24,622 --> 00:24:29,162 You know, so my next door neighbor is Roger Daltrey from The Who. 431 00:24:29,358 --> 00:24:31,838 So, so that's, so that's what I've done. 432 00:24:31,838 --> 00:24:36,298 And I never ever thought Barnaby it would happen or it could happen. 433 00:24:36,298 --> 00:24:41,218 And what really does worry me is I don't think I've met anyone else. 434 00:24:41,218 --> 00:24:45,198 And we were talking about this before in marketing services that have had an exit 435 00:24:45,198 --> 00:24:45,998 as big as mine. 436 00:24:45,998 --> 00:24:47,548 And that, that is a concern. 437 00:24:47,548 --> 00:24:50,438 And I think that there are the opportunities for people who are listening 438 00:24:50,438 --> 00:24:54,478 to this podcast to achieve their goals and dreams financially from this. 439 00:24:54,478 --> 00:24:58,458 It just need to take a slightly different view on how they go about it. 440 00:24:58,971 --> 00:25:00,791 So what do you put it down to? 441 00:25:00,791 --> 00:25:07,331 Like, why do you think, you know, was there a healthy dose of luck in there or 442 00:25:07,331 --> 00:25:12,495 sort of what was the mix of things that contributed to it being so successful? 443 00:25:13,750 --> 00:25:13,950 luck. 444 00:25:13,950 --> 00:25:17,430 I mean, the luck was, it was the mobile decade. 445 00:25:17,430 --> 00:25:20,690 The luck was there was this outsourced model. 446 00:25:21,410 --> 00:25:25,730 Because unlike web development, mobile apps still seemed like a bit of a dark 447 00:25:25,730 --> 00:25:26,730 art. 448 00:25:27,550 --> 00:25:31,030 It seemed impenetrable for a lot of other IT businesses because it was kind of 449 00:25:31,030 --> 00:25:33,390 compiled native code type stuff. 450 00:25:33,390 --> 00:25:34,958 So there was some luck. 451 00:25:34,958 --> 00:25:39,038 I've been building the business for a long period of time, so there's a lot of 452 00:25:39,038 --> 00:25:39,678 provenance. 453 00:25:39,678 --> 00:25:42,798 I really knew how to run a business. 454 00:25:42,798 --> 00:25:46,758 So these, you know, you go and you see these kind of MDs and big corporates, they 455 00:25:46,758 --> 00:25:50,338 don't have a full stack P &L like, you know, your listeners deal with. 456 00:25:50,338 --> 00:25:55,998 They're just doing sales and what they call SRS, which is their costs of labor. 457 00:25:55,998 --> 00:25:59,138 They don't do anything underneath, all the treasury functions taken away and all this 458 00:25:59,138 --> 00:25:59,978 stuff and thing. 459 00:25:59,978 --> 00:26:03,578 So, you know, so we go, you know, so I went in with a really deep understanding, 460 00:26:03,578 --> 00:26:08,578 but I think what really made the difference is we had, there was me and two 461 00:26:08,578 --> 00:26:09,958 other partners. 462 00:26:11,214 --> 00:26:12,894 Anthony was very technical. 463 00:26:12,894 --> 00:26:13,854 He was great with clients. 464 00:26:13,854 --> 00:26:16,344 If anything went wrong, he would go and sort those kinds of things out. 465 00:26:16,344 --> 00:26:18,014 Very senior, excellent. 466 00:26:18,014 --> 00:26:20,194 Myself and Marcus were very money focused. 467 00:26:20,194 --> 00:26:25,994 He was still in love with the craft, loved being a CEO, wanted to be right there on 468 00:26:25,994 --> 00:26:27,886 the... 469 00:26:27,886 --> 00:26:30,886 on the throne and that was great and I did the maths. 470 00:26:30,886 --> 00:26:34,326 So I was selling a lot flying around the world but I kept a model going all the 471 00:26:34,326 --> 00:26:37,906 time and we were just very focused, very numerate and driving things. 472 00:26:37,906 --> 00:26:42,438 So we kind of made our own luck and as I was saying earlier I think... 473 00:26:42,446 --> 00:26:46,586 If I was talking to an agency boss and I say, what is the way that you can 474 00:26:46,586 --> 00:26:52,126 outsource work to make enough margin to be able to achieve those kind of metrics? 475 00:26:52,846 --> 00:26:55,556 Is AI and the use of AI the way forward on that? 476 00:26:55,556 --> 00:26:56,276 I'm not too sure. 477 00:26:56,276 --> 00:26:58,366 So that's one for discussion. 478 00:26:58,939 --> 00:26:59,619 Yeah. 479 00:26:59,619 --> 00:27:04,439 And sort of looking back at your experience, what is there anything that 480 00:27:04,439 --> 00:27:05,723 you do differently? 481 00:27:07,918 --> 00:27:09,258 Do you know what? 482 00:27:09,258 --> 00:27:11,118 I always thought there would be. 483 00:27:11,518 --> 00:27:15,878 I would say I should have sold a year later, which would have meant I got the 484 00:27:15,878 --> 00:27:17,138 cap higher. 485 00:27:17,218 --> 00:27:21,098 But you could always say that in hindsight. 486 00:27:21,258 --> 00:27:23,982 I got the cap on the earn out. 487 00:27:23,982 --> 00:27:28,002 higher than I ever would have imagined we would ever have sold the business for. 488 00:27:28,002 --> 00:27:33,022 So it never, it genuinely didn't occur to me we'd ever reach it, let alone go 20 489 00:27:33,022 --> 00:27:34,162 million pounds through it. 490 00:27:34,162 --> 00:27:37,262 So you could look back and say, well, you should have done a better deal when in 491 00:27:37,262 --> 00:27:41,862 fact, no, it was, you know, it was the best deal we could at the time. 492 00:27:41,862 --> 00:27:44,362 I mean, hindsight is a good thing. 493 00:27:44,362 --> 00:27:45,412 What would I do? 494 00:27:45,412 --> 00:27:47,042 I would do it earlier. 495 00:27:47,042 --> 00:27:51,882 You know, so I essentially, I essentially sold when I was 40. 496 00:27:52,718 --> 00:27:54,298 43. 497 00:27:54,298 --> 00:27:58,358 I should have done it 10 years earlier but actually the times weren't right we just 498 00:27:58,358 --> 00:28:00,958 needed everything coming together at the right time. 499 00:28:00,958 --> 00:28:07,438 We also made sure that we sold, we were a digital agency let's say, we had offers 500 00:28:07,438 --> 00:28:10,698 from other digital agencies but we took an offer from a business that wasn't a 501 00:28:10,698 --> 00:28:16,526 digital agency so that we could... 502 00:28:16,526 --> 00:28:20,006 stay and remain as a single entity as a whole going through that we weren't 503 00:28:20,006 --> 00:28:22,526 dissolved into everyone else's P &Ls. 504 00:28:23,346 --> 00:28:24,576 So it was a lot of luck. 505 00:28:24,576 --> 00:28:30,086 I think we were very, very aggressive in defending our culture. 506 00:28:30,226 --> 00:28:35,886 We were very aggressive when we did the &As about retaining control. 507 00:28:37,026 --> 00:28:41,902 So and the detail of that can be shared another time. 508 00:28:41,902 --> 00:28:46,802 But a combination of things, serendipity, you know, just the state of the market. 509 00:28:46,802 --> 00:28:51,902 If I was doing it again now, I had thought about 18 months ago, two years ago, going 510 00:28:51,902 --> 00:28:55,042 out and buying, wrapping up a whole things and selling it on. 511 00:28:55,762 --> 00:28:56,682 I think it's different. 512 00:28:56,682 --> 00:28:57,542 I'm not saying it's harder now. 513 00:28:57,542 --> 00:28:58,251 I think it's different now. 514 00:28:58,251 --> 00:29:00,642 It certainly couldn't do it the way I did it last time. 515 00:29:00,642 --> 00:29:04,662 But all the minutiae and negotiations, all the components that were put in still ring 516 00:29:04,662 --> 00:29:05,542 true today. 517 00:29:05,542 --> 00:29:11,634 So looking back, no, I don't think I could have done anything different. 518 00:29:12,462 --> 00:29:13,551 in reality. 519 00:29:13,551 --> 00:29:17,823 the ownership structure at the point you sold? 520 00:29:19,172 --> 00:29:22,382 so we have three shareholders. 521 00:29:23,302 --> 00:29:27,782 Two of us had, it's slightly complicated and I'll come back to this in a second, 522 00:29:28,062 --> 00:29:32,762 one had 7 .5 % and the other two of us had the remainder between us. 523 00:29:32,762 --> 00:29:34,126 However... 524 00:29:34,126 --> 00:29:38,606 You may remember I said that I bought a new partner in. 525 00:29:38,606 --> 00:29:42,126 So I'd had loads of partners over the years, but no one was ever kind of good 526 00:29:42,126 --> 00:29:43,206 enough. 527 00:29:43,226 --> 00:29:45,946 And when Marcus came in, he was really exceptional. 528 00:29:46,586 --> 00:29:51,056 And he'd sold his first business and left and started another smaller business. 529 00:29:51,056 --> 00:29:52,446 And we thought, how could we come together? 530 00:29:52,446 --> 00:29:56,806 So in fact, what we did is we looked at his little agency, my agency, which was 531 00:29:56,806 --> 00:30:01,446 Flipside, we created founder shares, which were a different class of shares. 532 00:30:01,446 --> 00:30:04,580 So we valued both of those businesses, put them together, 533 00:30:04,940 --> 00:30:08,220 and that was founder shares and then we had growth shares because we recognized 534 00:30:08,220 --> 00:30:11,280 that we were, myself and Mark, we're gonna have an equal impact on the growth of the 535 00:30:11,280 --> 00:30:11,860 business. 536 00:30:11,860 --> 00:30:16,120 So what we did is we valued what we'd achieved to that point and then went into 537 00:30:16,120 --> 00:30:16,890 partnership thereafter. 538 00:30:16,890 --> 00:30:21,800 So what it means when we did sell the business, more of the first tranche of 539 00:30:21,800 --> 00:30:27,000 money came to me than anyone else because Flipside had been valued a lot higher. 540 00:30:27,000 --> 00:30:28,320 And that's actually really good. 541 00:30:28,320 --> 00:30:31,280 And I've spoken to agency bosses about this before, particularly if you're 542 00:30:31,280 --> 00:30:32,600 looking to merge things together. 543 00:30:32,600 --> 00:30:33,070 I mean, 544 00:30:33,070 --> 00:30:35,790 you imagine you've got two businesses making half a million pounds profit a 545 00:30:35,790 --> 00:30:38,810 year, you know, it's very, very difficult to get a million, but you can bring them 546 00:30:38,810 --> 00:30:39,490 together. 547 00:30:39,490 --> 00:30:42,150 There's all sorts of politics and emotion about that. 548 00:30:42,150 --> 00:30:47,270 But actually you say, well, well, business A is worth X, business B is worth Y, value 549 00:30:47,270 --> 00:30:51,370 them and then say, right, that's banked, now let's move on. 550 00:30:51,490 --> 00:30:54,550 It's a really positive way and that's how I did it. 551 00:30:55,675 --> 00:30:56,645 That's really interesting. 552 00:30:56,645 --> 00:31:00,115 I think that that could be relevant for a lot of people actually, as is, you know, 553 00:31:00,115 --> 00:31:05,015 if you can identify the right partner that you want to do that with, and that you can 554 00:31:05,015 --> 00:31:10,435 see a route to being able to grow the two businesses together. 555 00:31:10,615 --> 00:31:14,798 That sounds like a really good way to achieve a bit of scale. 556 00:31:14,798 --> 00:31:16,558 you're not exactly part of it. 557 00:31:16,558 --> 00:31:18,818 You're not creating a tax event either. 558 00:31:19,038 --> 00:31:22,058 What you're doing is you're just crystallizing a value at that point. 559 00:31:22,058 --> 00:31:24,888 Then you're creating some new shares that have no basis on that value. 560 00:31:24,888 --> 00:31:26,918 They have basis on value beyond that. 561 00:31:26,918 --> 00:31:31,238 So essentially, in my case, what it meant was that when the first 3 million pounds 562 00:31:31,238 --> 00:31:35,758 came in from the sale, it was split very differently to the next 3 million pounds. 563 00:31:36,638 --> 00:31:41,418 And it's such an objective way of going about things. 564 00:31:41,422 --> 00:31:45,982 that it takes the hard edge of some of those conversations with future partners 565 00:31:45,982 --> 00:31:46,982 away. 566 00:31:47,579 --> 00:31:48,458 Great. 567 00:31:49,939 --> 00:31:52,799 Well, it's very inspiring to hear your story. 568 00:31:52,799 --> 00:31:58,259 And if people want to get in touch with you, is there a way that they can do that? 569 00:31:58,722 --> 00:32:00,982 look, definitely, again, we've spoken about this. 570 00:32:00,982 --> 00:32:03,972 I mean, I'm always happy to speak. 571 00:32:03,972 --> 00:32:09,362 I mean, I wish I had someone like me to speak to when I was 10, 15 years ago. 572 00:32:09,362 --> 00:32:11,802 So I'm always happy to speak to someone. 573 00:32:11,802 --> 00:32:17,182 Obviously, you know, that's just like one successful agency boss to another just 574 00:32:17,182 --> 00:32:17,822 helping out. 575 00:32:17,822 --> 00:32:20,662 If it turns into something more dramatic, we can always discuss those kind of 576 00:32:20,662 --> 00:32:21,002 things. 577 00:32:21,002 --> 00:32:26,670 But yeah, they can get in touch with me at timatimimdrake .com. 578 00:32:26,670 --> 00:32:31,610 So my initials are IM, so tim at timimdrake .com. 579 00:32:31,610 --> 00:32:34,669 And I'd love to hear them, love to hear their stories and their plans. 580 00:32:34,669 --> 00:32:39,150 And if there's anything I could do in a conversation to help them, then I can. 581 00:32:39,150 --> 00:32:44,550 I've been there, I've done it, and I've known the pitfalls and the benefits. 582 00:32:45,851 --> 00:32:47,091 That's fantastic. 583 00:32:47,091 --> 00:32:52,051 Seems like a good place to wrap it up and we can let you get back to your lawn 584 00:32:52,051 --> 00:32:52,891 mowing. 585 00:32:53,518 --> 00:32:54,128 No, it's fine. 586 00:32:54,128 --> 00:32:55,018 Well, thank you very much. 587 00:32:55,018 --> 00:32:57,158 I mean, yeah, I am still doing business. 588 00:32:57,158 --> 00:33:00,378 The only thing I would say as well, that there's some very specific components of 589 00:33:00,378 --> 00:33:02,918 when you sell a business, which could become their own podcast in their own 590 00:33:02,918 --> 00:33:03,258 right. 591 00:33:03,258 --> 00:33:06,338 And maybe we can revisit some of those in the future. 592 00:33:06,518 --> 00:33:07,218 So. 593 00:33:08,475 --> 00:33:09,275 Yeah. 594 00:33:09,275 --> 00:33:10,435 Okay, great. 595 00:33:10,435 --> 00:33:11,035 All right. 596 00:33:11,035 --> 00:33:12,526 Well, thanks very much. 597 00:33:12,526 --> 00:33:13,406 care.