“We’re Putting the Band Back Together” – Finding the Way Back
Published on October 30, 2020
“We’re Putting the Band Back Together” – Finding the Way Back
The 30th October will always be a special date for me. It was on this day in 2006 that I was privileged to oversee the go-live of the HM Prison Service Shared Services operation in Newport, South Wales (known today as Shared Services Connected Ltd – SSCL) providing HR & Payroll services for 45,000 employees over then 120 geographic locations and ultimately being part of a truly wonderful team that created 500+ jobs.
By serendipity, ten years later in 2016, it was also the same date that saw Certus deliver the very first Oracle ERP & HCM Cloud implementation at the Office for National Statistics (ONS), ironically the ONS campus being just around the corner from the SSCL. So, I find it quite apt to publish this blog today 30th October 2020 regarding the next venture – de Novo Solutions.
Just because you have been successful previously does not give you the automatic right or a free pass straight back to the top of the mountain. Running any kind of business is full of inherent risk and it still surprises me as to how so many people do not grasp this, let alone understand it. However, those in the entrepreneurial community live with this day-in and day-out, as any financial risk materialising is often immediately inherently real. For those who are prepared to embark on such a journey, to give themselves and others a better quality of life and just make the world a better place by creating a progressive economy they will always have my undying respect.
Coming back from a standing start was never going to be straight forward, and “getting the band back together” is not as easy as it may seem or perceived to be, but that is what we are doing. So, let me give you some insight into how we have gone about this.
It just starts with a conversation…
It always starts with a conversation. Back in October 2011 Tim Warner and myself were in a Client’s office late at night in London, ironically just 200 yards from Accenture’s HQ. Who would have guessed that in May 2018 that they would be our eventual acquirers? we certainty didn’t.
Roll forward October 2020 and this time it was a phone call to Switzerland, with the opening line “You done with retirement now?”. The discussion that followed talked about what we had achieved, the opportunities missed, what we had learned and what we definitely would not do again.
For those who follow my blogs, it should not be too difficult to work out that I have been researching the experience economy for some time so I had a firm idea of what we were going to do but not necessarily as to how we were going to do it and if anyone would really be interested. However, I enjoyed myself for an hour, the first time in many months and my wife commented I was smiling when I came off the phone and that I appeared to have my mojo back.
It was fun exploring with absolutely no constraints the art of the possible. I was also excited in that we could not only build something again, but to do something nobody had done before to my knowledge in positively disrupting the same market twice.
Getting the Band Back Together
One of the many rules of creating a successful business, is to surround yourself with people who are better than you. Our famous “black book” of the UK Tech ecosystem is full of talented people and naturally this is always our first point of call.
I often joke with my peers in Oracle and across the wider community, reminding everyone that we created the football pitch for Oracle Cloud professional and managed services in the UK&I that everyone today is now playing on and now we are coming to take our players and ball back, as we need it for the new pitch. (by the way were also going to need the goal posts as well for those that are reading!)
Seriously though, the trick is to create a collective that is exponentially greater than the sum of its individual parts. The basic characteristic that underpins everything is trust. Hence, why I always stress that we never ever promise anything we cannot deliver, and we clearly outline the risks to everyone involved we talk to so they can make an informed decision regarding if they want to play?
Coming on an adventure with us is anything but risk free, there are no guarantees, but we do promise working with a group of liked minded individuals that are building a great British company, will push the envelope from a technical perspective once again and will have a good laugh along the way.
We don’t have the monopoly on talent, but we do have an eye for spotting potential and bringing people together and developing individuals and teams.
Just a Game of Chess
I have used the analogy so many times, business is just a game of chess. To be successful you need to see the whole board…There is a lot to do in getting started, so here is just a starter for ten. In doing so you begin to see some, not all, of the pieces on the chess board.
1. No Idea is a Bad Idea – “Be Poets, and let your imagination run riot!” – Nothing is off the table, The beauty about being an entrepreneur and working with a small team is total unconstrained thinking! Nobody can constrain your ideas except oneself, nobody to shout you down, and most importantly no b•••sh•• corporate bureaucracy to navigate.
2. Stealth Mode – Despite our enthusiasm we have taken our time. We are not in the business of just re-entering a market, albeit one we created, that is now both competitive and is commoditised where the race to the bottom of the rate card has become the only game in town. We have absolutely no interest in this.
The market is constantly watching what we are doing so we are in stealth mode where we can keep the market waiting and guessing until we are ready, but this also gives ourselves time to research and develop the proposition and to test it with all our stakeholders. We need time to see the whole board.
The cheapest and most effective form of marketing sometimes is just being quiet.
3. Business Strategy – No war and peace required here, but by getting the business idea down onto paper allows clarity of thought and understanding for everyone involved.
Included is the hypothesis is the exit strategy and timeline. By undertaking this activity up front, we achieve consensus and agreement as to what the end game looks like, and how we are to get there. Albeit the route we decide upon we know from experience will have many-twists and turns.
Our approach is simple, we are repeating the same strategy we did a decade earlier because we know it works. We focus upon creating not only a new service proposition but a new niche market and in doing so we become the number one service provider by default. This underpins all of our thinking from the outset.
No idea is ever entirely unique, so you need to know and understand who your competitors are, and also have an idea as to how they will react. The beauty about the Management Consultancy and Systems Integrator landscape is the large players are extremely predictable. They won’t see this themselves, they never do, but you can use this kind of market intelligence and insight to shape the market. The SME market is far less predictable so you have to do your research. Somebody will always come at you from left field.
Differentiation is the name of the game and resonates with a saying we use internally ‘Be Different, Be You!’
4. Test, Test and Re-Test the Business Proposition with the Market – Any hypothesis of what the business proposition is has to be tested with as many people as possible including but not limited to former employees, business partners, industry experts, former customers and even previous prospects who didn’t buy from us. This allows any business proposition to naturally evolve, but also allows the 30 second elevator pitch to develop naturally.
5. Know the Numbers – This was something in the early Certus days I will be honest we never had a proper grip of. This time it is very different as we have a sophisticated financial model (Yes – it is an Excel Spreadsheet, but in the right hands!), so we can determine our cash runway, our commercial proposition, and understand how we are going to fund the venture.
Cash is always King. Don’t get distracted by future valuations based upon EBITDA multiples – this is absolute nonsense. No cash, you have no business, and you have no value. It really is that simple.
I can’t stress this enough you have to know the numbers from the outset. Make it an obsession.
6. Bootstrap Financing – If you raise equity money (which is not a bad thing) you are always going to be giving something away. Our approach is always to self-fund and use debt financing through Directors Loans to get going. Depending then on how the business plan develops we can decide funding options to support expansion at the appropriate point in time. Admittedly were not scratching around in the dirt this time.
7. Legal Structure – Important; get the share structure agreed upfront. The reason is simple – All the Founders understand the agreement, know the rules of the game and have the agreement on legal paper. Consequently, everyone then feels their interest is protected, and we can all focus on building a great Company. The right expectations are set from the outset and consequently there are no arguments or fall outs. Failure to do this, creates ambiguity and allows bad feeling to foster. This breaks trust and can contaminate the culture from the outset.
8. Develop the Employee Value Proposition – Again undertaken upfront. We know a lot of people, and because of what we do, our success, and most importantly how we go about it, we are quite lucky a lot of people want to work with us.
I am always reminded by the words of a Senior Partner of one of the Big 4 when he said about what was then Certus ‘It’s like an exclusive private members club, many want to join, but only a few are let in’. And before anyone starts over thinking this in terms of diversity or inclusion, we recruit purely on talent, attitude and mindset of the individual regardless of their background. We always like to say to someone ‘you are really good, but we are going to make you even better’.
Financial remuneration is always going to be a key factor. There has to be limits to what the business can afford, and timing is always an issue. You can’t go writing blank cheques.
9. Team – Identify the designated executive team, knowing what you need and why you need them. Subsequently you can determine the onboarding strategy and onboarding waves.
Think of it like fantasy football, in that you cannot afford all the best players, as you don’t have unlimited funds. So, you need to buy carefully. Remember in starting out you have to have people that buy into the vision.
10. Start Selling! – Conversations through testing elements of the new business proposition creates opportunities. So, start selling from day one. Always good to get a run on the board however small as early as possible.
The famous Peter Drucker quote ‘Culture eats strategy for breakfast’ is right, but you still need a strategy. You can’t wildly go wandering off using ‘hope’ as your strategy, burning money left, right and centre. Equally you don’t have an action item that just says ‘Create Culture’. We don’t make businesses overly complicated and the values of the business are our values from which we create our culture:
Insight delivered. As President Bartlett, from the West Wing, would say “What’s Next?” – well we need to get on building a great British Company in de Novo. See you soon…
Mark Sweeny, Founder de Novo Solutions