Will joined BGF in June 2011 as an investor covering London and the South East and his main role is to source and complete investments into SMEs in the region. He also works with the boards of five portfolio companies to drive value creation, including supporting acquisitions and follow-on investments. In this role, Will has completed seven investments across the technology, leisure & retail, industrial and business services sectors.
Before joining BGF, Will spent six years at Bank of America in London and the US, latterly as an Associate in the bank’s leveraged finance team, focusing on acquisition financing for Global Industrial and US Middle Market clients. After leaving Bank of America, Will studied for an MBA at London Business School, which he completed in 2011. He also has an MA in Economics & Economic History from the University of Edinburgh.
Having grown up on the coast in the south west, Will is a keen sailor, although his young family tends to distract him from much time on the water these days.
“What I love about the businesses that BGF backs is that they are usually still managed by their founders and that makes it much more personal and enjoyable if you can help them achieve their ambitions.”
- Cass Art (Board Director)
- Statesman Travel (Board Director)
- Semafone (Board Observer)
- Molecular Products Group (Board Observer)
- Cennox (Board Observer)
- Anstey Horne
Head of Strategic Investment
Marion is a member of BGF’s executive team, sits on the national BGF Investment Committee for both BGF and BGF Ventures, and is responsible for BGF’s strategic investment activity.
Marion has over 20 years’ experience of funding small and medium sized companies across the UK. She joined BGF in October 2011 directly from Northstar, where as Chief Executive she led the successful development of this pre-eminent regional fund management business, focused on making long-term equity based investments in SMEs across the North East and Yorkshire markets. Prior to Northstar, Marion gained debt and equity investing experience with Barclays and 3i in London and has been directly involved in a range of deals covering buyouts, growth capital and early stage technology investments. At BGF Marion initially led the London and South East regional team to invest in over 30 companies, and successfully exit three of these – Unruly, The Exchange Lab and Plastique.
Marion has a BA (Hons) in Economics, lives in Hertfordshire and enjoys tennis, walking and visiting Northumberland.
“It has been an absolute privilege to be backing entrepreneurs across the UK to support their growth agenda, and to work with everyone at BGF to help companies scale up with our flexible and long term capital offering. We will continue to actively listen to entrepreneurs and ensure that BGF is ambitious in its own development to fully support SMEs that form the backbone of UK plc”.
FUNDING STRATEGIC ACQUISITIONS
For businesses determined to grow quickly, a strategic acquisition can be the transformative moment in their evolution. But buying another company requires both deep pockets and the skill and experience to integrate two organisations in a way that realises their combined potential. Many growing companies have the ambition to expand this way, but lack the means to do it.
By the beginning of 2012, Anthony Foy, the chief executive of SkyDox, a business offering secure file sharing facilities that use cloud technology, was facing exactly this dilemma. “We were a small and innovative company that was a leader in its field, but we were growing in incremental steps, mostly thanks to business angel investors,” Foy explains. “We came to the conclusion that making an acquisition would enable us to realise our ambitions more quickly.” He identified Workshare, a US company with a very complementary document management business, as the perfect target. The question was how to finance the deal.
“It was a slightly unusual transaction because we were hoping to buy a company that was both older and bigger than us,” Foy says. Securing sufficient debt from risk-averse banks was out of the question and equity investors were wary too. “We did pitch to several private equity companies, but I wouldn’t say imagination is a particular hallmark of that industry,” Foy recalls. The solution proved to be an injection of growth capital from BGF.
In September 2012, it invested £7.25m in SkyDox, with Scottish Equity Partners also participating in the financing. The acquisition of Workshare was completed a few weeks later. “Raising money is never easy – it’s a painful and humbling process and you have to really believe in what you’re doing,” says Foy. “We chose BGF because they had the intellectual capacity to see beyond the immediate risk of the deal to the longer term potential of bringing these companies together – they had the capital we needed to grow, but they also offered a partnership where our interests were aligned.”
Nevertheless, Foy says he thought hard about whether he had the drive to make the deal work. “The pain is something you put up with in order to realise your ambition,” he says. “Not everyone desires that and part of this process is deciding whether you really want to go for that growth, or whether you prefer to run a lifestyle business.”
That’s a familiar refrain for Chris Hodges, an investor in BGF’s London office. “Our single-biggest competitor is the ‘do nothing’ approach,” he says. “The reality is that it’s tough out there and ambition is a crucial ingredient of business success.” This is one reason, why, says Hodges, the quality and attitude of the management team are priority considerations when he is mulling an investment in a business. “I need to get a sense they’re open to the bigger picture, to really strategic thinking,” Hodges adds. “We only take minority stakes, but equity dilution can be an emotional thing, so we need managers who recognise that growth capital can really turbo-charge their business.”
For those managements that meet these tests, an equity investment – especially from BGF – is the ideal way to finance an acquisition, he argues. “Equity capital is far less restrictive than bank debt, where the borrower is subsequently required to perform to very tightly defined criteria where failure may mean losing control of the business.”
Mervyn Williamson, the joint managing director of business travel management specialist Statesman Travel, points to another advantage of growth capital he says was crucial when his business was considering fund-raising options. “Bank debt wasn’t going to be practical – the problem we pose for the banks is that we’re not an asset-backed business so there’s no security for a lender – because our model depends entirely on earnings,” he says.
“But even if we had been able to borrow the money to do the deal we wanted to do, we wouldn’t have gone down that route because we were also looking for additional expertise at the boardroom table, ideally from someone outside the business travel sector who would bring a different mindset to our company.”
Like SkyDox, Statesman was also on the acquisition trail. “My partner and I had bought Statesman in 2007 and we grew it from £28m of annual revenues to £50m three years later,” he says. “But we needed to be bigger than we were in the eyes of some of the larger potential clients, who felt uncomfortable dealing with a company where they’d be a disproportionately large customer.”
That posed a chicken-and-egg problem, with larger clients unwilling to come on board until the business grew bigger while the business struggled to achieve that growth without the bigger clients. “We began looking for acquisition targets and having identified Commodore Travel, we had to think about how we would finance the deal,” Williamson adds.
Having decided growth capital was the best fit for his business, Williamson began talking to a number of interested private equity firms. But he didn’t want to give up control of the business and he was concerned about the “churn factor” in the industry. “Three years after they buy you, you can find yourselves sold to someone else who you may or may not like,” he complains.
Finally, Statesman was introduced to BGF by its banker, Lloyds Banking Group. In October 2011, the company became what was then only BGF’s second investment, accepting a £4.25m injection of funding, which was crucial in clinching the acquisition of Commodore. “We did think long and hard about bringing in a third party, but we’re happy to have ended up with a minority investor whose interests are aligned to our own,” Williamson says. “We also like being part of a portfolio family – we’ve been able to offer our services to some of the other companies in which BGF has subsequently invested and to source from those businesses at a competitive rate.”
A year-and-a-half later, Williamson says both the rationale for the acquisition and Statesman’s choice of funding solution are proving themselves. “The combination of our two companies has given us a great deal of additional credibility in the market place, boosted our procurement power and given us real strength in depth – we’ve totally raised our game,” he says. “We’re also continuing to invest, which costs money, but there’s going to be a return on that investment and we’ve had the support of BGF as we’ve made those commitments.”
All of which is music to the ears of BGF’s Chris Hodges. “More people need to recognise the attractions of growth capital,” he argues. “It became deeply unfashionable for a period, amid the first dot.com boom and the years of easy credit that followed, when leverage and debt were all the rage, but this really is an excellent way to develop a business.”
Statesman acquires Commodore International Travel
Statesman Travel Group have announced that it has acquired Commodore International Travel.
The combined entity will trade as Statesman Travel, with Commodore’s Masterfare remaining a distinct and separate brand. London remains the major centre for the business supported by its regional office in Manchester. The enlarged group will become a ‘top 10’ UK travel management company in terms of transactional volume, with revenues of circa £100 million and a staff of 150 people.
The Business Growth Fund (BGF), which has been established to invest in Britain’s fast growing smaller and medium sized businesses, has supported this acquisition. It will take a minority stake in Statesman and will sit on the board alongside the current management team, led by Mervyn Williamson and Jon Langley.
Statesman is known for its high levels of service and for seeking out and applying innovative solutions to set the industry standard in delivery. In tough market conditions, Statesman has increased sales by well over 50% since its acquisition in July 2007. This has been achieved through working in close partnership with its blue chip customer base, which includes strong representation from the financial services, professional services, property and media sectors.
Jon Langley, Joint Managing Director of Statesman Travel, commented:
“This investment and acquisition is fantastic news for both businesses, as well as our clients and staff. Commodore Travel is a well-established business with whom Statesman has much in common. We believe that there is a strong rationale for combining our strengths, both optimising the service that we offer our existing clients and expanding our capabilities to meet the needs of multi-national companies in the future. Together we can be a potent force in the travel management sector.”
Mervyn Williamson, Joint Managing Director of Statesman Travel, commented:
“We are committed to ensuring continuity and will be harnessing the benefits of the enlarged group for our clients. Customer service remains absolutely key to what we do.
This is a critical next step in Statesman’s ongoing growth and in the BGF we have a partner investor who will actively support this. In addition to funding, they provide expertise and high level contacts; they will sit on our board and will bring an edge to the business – all of which will be of great benefit to Statesman and our clients.”