News about 12 UK growth companies and/or accelerators (turnover in brackets) in the GRID marketplace, 28th February – 5th March 2016:
Yü Energy (£8.4m) | Vector Aerospace | EBAC (£17.5m) | Vydex (£8m) | Watchfinder (£38.7m) | Arena Flowers | Artic Power Berries | DesignMyNight (£7m) | JBW Group (£100m) | Go Ape (£20m) | Revolution Bars (£113m) | Blippar
YÜ ENERGY: Energy supplier plugs into AIM | Sunday Times. 28 February, 2016
DZ profile: YÜ Group Plc
Business: energy company which sells electricity and gas to small and medium-sized businesses. Has 1,700 customers
Founder: Bobby Kalar, care homes entrepreneur who made his money from Redrose Care, a Midlands care homes chain.
Financials: posted revenues of £8.4m last year
1. planning a £20m float on AIM, the junior stock market, and hopes to raise £7.5m. Shore Capital is advising on the float.
UK energy supply companies navigate volatile market | Chris Tighe and Andy Bounds, FT. February 8, 2019
2. ...after an accounting review in October shares crashed from a £14.32p peak in March to 42p in December and are now around 124p. ....concern over areas including historic accrued income — which make assumptions about how much energy customers will consume — and provision for bad debts. It also warned of a £10m drop in profitability, leading to a current year loss.
3. In November, the board appointed DLA PIPER and PwC to conduct an independent investigation into its accounts. In December, the Financial Conduct Authority announced an investigation into the accuracy of the company’s financial announcements. The board warned of an adjusted pre-tax loss of between £7.35m and £7.85m for the year to December 31 2018.Yü is debt free with cash of £14.6m at December 31.
4. the group reported a threefold growth in revenues, to £47m, in the year to December 31 2017 and profit of £1.8m. In March last year, Mr Kalar predicted revenues and operating profits for 2018 and 2019 ahead of market expectations and the group raised £12m in a placing.
VECTOR AEROSPACE: Raiders target helicopter deal | John Collingridge, Sunday Times.
Business: helicopter and aircraft repair company which maintains the RAF’s fleet of Chinooks. Vector absorbed the MoD’s former Defence Aviation Repair Agency (Dara) in 2008. One of its biggest contracts is a share of a £420m five-year programme to repair the Boeing-made Chinook. It also works on the MoD’s AgustaWestland-made Sea King and Lynx helicopters, and repairs Rolls-Royce engines for the Hercules military heavy lift plane.
ICB Classification: 2777 Transportation Services
Investment: was bought by aerospace giant Airbus only in 2011 for $640m, but a deal could now value it at about $800m (£575m).
News: Airbus has appointed investment bank Moelis to handle the sale of Vector Aerospace, as part of it’s plan to offload a range of defence assets. Has attracted interest from buyout funds, including Cinven and Vista Equity Partners, as well as Airbus’s arch-rival, America’s Boeing.
I’m an exporter, get me out of the EU! | Simon Duke, Sunday Times.
Business: sells more dehumidifiers, water coolers and air source heat pumps in mainland Europe than it does at home
ICB Classification: 2737 Electronic Equipment
Location: Newton Aycliffe, County Durham
Founder: John Elliott, 72
Financials: in 2014 the company took in £17.5m - £8.8m from continental Europe and £8.7m from domestic customers.
News: VOTING LEAVE EU - “…it doesn’t work well now. There’s too much cost, too much bureaucracy, and it has become too politicised.”
Business: health and sports supplements maker
ICB Classification: 3577 Food Products
Founder: Melvyn John, 71
Financials: turnover £8m
News: VOTING REMAIN IN EU - The entrepreneur said he was aiming to increase his turnover from £8m to £40m by 2020 by targeting new customers on mainland Europe. If John’s plan comes together, the staff headcount could rise from 70 to 100. Brexit could shatter his dreams of expansion. “Anything that interrupts our strategy would be damaging to us and the local economy”.
WATCHFINDER & CO: How I Made It: Lloyd Amsdon, co-founder | Laura Onita, Sunday Times.
DZ profile: Watchfinder.co.uk Limited (Watchfinder & Co.)
Business: Retailer of used watches. Watchfinder buys most of its stock from individuals — just 20% is sourced from dealers. Website accounts for 60% of sales, where prices range from £250 to £175,000. Its customers spend an average of £4,000 on brands such as Rolex, Cartier and Patek Philippe. The It has a team to repair and refurbish timepieces before they go on sale.
Location: Maidstone, Kent. Opened its first store in London’s Royal Exchange, next to the Bank of England, three years ago. Now has three sites in London, one in Leeds and another at Bluewater shopping centre in Kent.
Founders: Lloyd Amsdon and Stuart Hennell
Financials: Last year Watchfinder posted £2m profit on sales of £38.7m.
Investment: set up the company with their savings before selling their homes to raise cash for growth. He and his fellow directors own 70% of the company. In 2014, the venture capital firms PITON and BERINGEA invested £6.2m for a 30% stake.
News: has plans to expand overseas.
Advertising on social media is cheap — but money wasted unless you are clear who you’re targeting | Kiki Loizou , Sunday Times.
Business: flower delivery company
ICB Classification: 5377 Specialized Consumer Services
Location: Park Royal, northwest London
Founder: Will Wynne, 40
Financials: sales have grown 20% year-on-year
1. embracing social media was the plan from the start - pumped cash into Facebook ads and Twitter promotions (tweets that topped news feeds and cost him about 20p each) although struggled to make Facebook ads work well in the early days. What he didn’t expect was how much more business he would get from investing time in free posts to followers, often humorous ones. “At the start we were posting images of flowers but it was like talking to an empty room.” Now the company publishes amusing tweets and has built a Twitter following of 27,000. “The majority of our success on Twitter comes from good content that can be shared,” said Wynne.
2. has hired an agency to manage Facebook ads: “It’s not our job to spend all day understanding the different bells and whistles Facebook brings out every 10 minutes.” On Valentine’s Day, just 2% of Arena’s orders came in from Facebook ads, a campaign that cost “a few thousand pounds”. “All these platforms are continuing to evolve. What might have worked two years ago might not work today,” he said.
ARCTIC POWER BERRIES
Business: sells powdered fruits for use in smoothies and meals. Now has 11,000 followers on Instagram and its products are stocked by Harrods, Ocado and Whole Foods.
ICB Classification: 5337 Food Retailers & Wholesalers
Location: Dalston, northeast London
Founders: Anna Ojutkangas and Evelina Suoyrjo, both 28
News: work hard on social media, and it is starting to pay off. Spends about £50 on the Instagram ads each month, and about £100 on Facebook ads: “If we post something on Instagram we see orders coming in straight away. It gets to our target audience — but it’s a lot of work.” But as social networks get bigger, Ojutkangas and other entrepreneurs fear that, though ads are cheap, the volume needed to make an impact will only increase: “It’s getting more and more expensive if you want to reach people.”
DESIGNMYNIGHT: Nightlife turned tech company has the perfect cocktail for a great night | Clare Hutchison, Evening Standard. 29 February
DZ profile: Wfl Media Ltd (DesignMyNight)
Business: nightlife-guide website with almost four million monthly users. Customers can choose and book nights out, and the site sells tickets to venues from Cargo to Kensington Roof Gardens. It also provides the software that powers some of the UK’s largest restaurant and bar groups, including WAHACA and Fuller’s.
Location: Haggerston in East London
Founders: Andrew Webster, 32 and Nick Telson, 31.
Financials: Turnover £7m (2015), £14m (2016 forecast)
Investment: seven angel investors, including Friends Reunited founder Steve Pankhurst and Quidco’s Andy Oldham, who in stages injected £500,000.
1. Funding paved the way for the arrival of chief technology officer and “third founder” Will Taylor-Jackson, a schoolfriend of Webster who had been working nearby at Google. Taylor-Jackson rebuilt everything from scratch and created a bookings system, another innovation London’s bars had been crying out for. The software was built with input of clients such as Dirty Martini owner CG Restaurants. The collaboration paid off and since its launch in December 2013, they have added 500 clients across the country and in Europe, plus capabilities for restaurants and casual dining pubs. That success led to the creation of a ticketing platform and payment system, Collins Pay.
2. The aim is to grow the B2B division — the bookings and ticketing platforms that now contribute 60% of revenue — and a recently launched app.
3. Also looking to Europe - Madrid, Paris, Amsterdam - and maybe San Francisco and New York.
Entrepreneurs mix study and networking | Jonathan Moules, FT. 29 February.
Founders recount their experiences in a second series of the Start-up Stories podcast
Business: debt collection business which recovers money owed to UK government departments, local authorities and private sector clients.
ICB Classification: 8775 Specialty Finance
Financials: turnover £100m ($139m)
DZ profile: Adventure Forest Group Limited (Go Ape)
Business: outdoor adventure company which runs Tree Top adventure courses in forests in England, Scotland and Wales. In total, 860,000 customers visited Go Ape in 2015 across its 29 sites. Has a contract with the Forestry Commission for courses on multiple sites. The first course opened in March 2002 in Thetford Forest, on the borders of Norfolk and Suffolk.
Location: Bury St. Edmunds, Suffolk
Founders: Tristram and Rebecca Mayhew, the husband-and-wife team
Staff: employs more than 1,000 people across more than 40 sites in the US and the UK. Jerome Mayhew, managing director.
Financials: revenue increased to £20m across the UK in 2015, an 8% rise year-on-year.
1. Both founders completed the Business Growth Programme, a part-time modular course at Cranfield School of Management.
2. Although the concept of forest rope swings could be copied, the couple later realised that potential rivals decided against competing with them in the UK because their early marketing implied Go Ape was more established than it actually was.
£. Delays by their bank in processing a loan application meant the couple missed the first payment deadline set by their contractors, ALTUS, for their launch site construction. Altus told them to pay when they could. “If they hadn’t done that we would probably have gone bust before we even started,” Mr Mayhew says. Altus has since built all the Go Ape sites.
REVOLUTION BARS: boosted by City site as it plans second Square Mile venue | Joanna Bourke, Evening Standard. 1 March
DZ profile: Revolution Bars Group Plc
Business: Revolution Bars Group Limited is an operator of bars across the United Kingdom. The Company’s primary business is the sale of food and drinks to customers of its bars all of which are occupied under leases from third-parties. The Company has a trading portfolio of approximately 60 bars, located in town or city high streets across the United Kingdom, which it operates under the Revolution (52 sites) and Revolución de Cuba (8 sites) brands.
Staff: Mark McQuater, chief executive
Financials: 2.2% revenue rise to £59.2 million for the six months ended 31 December 2015. Pre-tax profit increased to £4.7 million from £4.3 million in the same period in 2014. Annual revenues: £113m.
Investment: Private equity owners Alchemy Partners cashed out from Revolution in the 2015 stock market listing on the London Stock Exchange. The private equity firm had delisted the bar business, when it traded as Inventive Leisure on London’s junior market, in a £42.5m buyout in 2005.
1. Six more bars are planned for 2016. A second site in the City is being sought.
Revolution U-turns over buyer for bars chain | Daniel Dunkley,The Sunday Times. 8 October 2017
2. ARTEMIS INVESTMENT MANAGEMENT, the biggest shareholder which owns 15% of the Revolution bars chain has withdrawn support for a £101.5m takeover by the pub group Stonegate, clearing the way for a rival bid from nightclub owner DELTIC - the owner of the Pryzm clubs chain. City analysts have also weighed in on the battle. Investment services firm CANACCORD GENUITY has argued that shareholders could double their money from a merger with Deltic, mainly through cost savings. Deltic is weighing whether to make a cash offer if its merger plan falls flat. Keith Edelman, the chairman of Revolution, has indicated that he would look at a cash bid from the group.
3. The interest in Revolution comes after a dismal stock market run since its listing in 2015. The share price crashed by 31% after a profit warning in the spring. Revolution blamed its financial woes on rising business rates, accounting issues and the new apprenticeship levy. The company parted ways with its finance director in February.
Business: computer vision group which specialises in “augmented reality” and has created an app that uses smartphone camera to overlay digital images on to real world pictures. 65m users worldwide. Does marketing work for brands such as Coca-Cola, Disney and Jaguar, creating campaigns based on its augmented reality technology.Blippar lets users “blipp” objects they see and call up information. Mitra said the app could recognise 65% of “everything in the world”. Advertisers see the potential of using the technology to promote brands.
Location: Founded in London. 14 global offices. Its main presence is increasingly the US, where it employs 60 engineers in the San Francisco Bay area.
Founders: Ambarish Mitra (Chief Executive Officer), Omar Tayeb (Chief Technology Officer), Steve Spencer (Chief Experience Officer) and Jessica Butcher (Director).
Investment: The company said it had raised funds from KHAZANAH NASIONAL BERHAD, the strategic investment fund of the Government of Malaysia, as well as additional investment from Blippar’s existing investors, which includes and LANSDOWNE PARTNERS and QUALCOMM VENTURES, the chipmaker’s venture capital arm. The funding takes its overall investment to more than $100m, making it one of the few British tech groups to secure funding over the mark. In July last year, told the Financial Times that he had turned down a $1.5bn acquisition offer from an unnamed suitor. The company is currently considered a "unicorn," having a valuation of over $1 billion.
News: has raised $54m to become one of the UK’s best funded start-ups, in the midst of a growing squeeze in investment for fledgling tech companies across the world. Blippar said that the new funding would be used to hire engineering talent and that it would also move into the education sector, hoping its technology could be used within classrooms to create “visual learning experiences”.
Slumdog tech boss backs gene start-up | Peter Evans, The Sunday Times. February 5, 2017.
1. Mitra, 40, set up Blippar six years ago, relocating it to California last year to be closer to investors. A $54m funding round in March last year made it a “unicorn” — a tech company valued at more than $1bn. Accounts for the 16 months to March last year revealed that Blippar lost £26.1m on revenues of £8.5m.
Blippar’s crash course in reality | Ben Woods, The Sunday Times. December 16 2018
2. After burning through tens of millions of pounds and closing offices around the world to cut costs, the company …faces a fight for survival.
3. If it falls into administration it could end up in the hands of luxury property developer Nick Candy, who remains convinced of its long-term prospects. He has been burnt before: the brash millionaire ploughed nearly £10m into the music start-up CROWDMIX, before buying it out of administration. Crowdmix collapsed after an out-of-control spending spree on parties, overseas travel for staff and expensive office decorations. 4. Candy owns 49%, the hedge fund Lansdowne Partners holds 14%, Khazanah 12% and US tech giant Qualcomm 12%. While Candy is understood to have offered about $5m to keep Blippar alive, Khazanah blocked the move. Khazanah’s entire board was replaced in June and a Blippar insider suggested the new board had decided to cut ties with many of its previous investments.
5. With the lure of its technology, which allows smartphone users to interact with real-world items such as supermarket promotion signs, the company raised almost $150m from investors and struck deals with MCDONALD’S and KELLOGG’S.… struggled to live up to the hype.
6. It managed sales of just £5.7m for the 12 months to the end of March last year, while racking up £35m in losses. Despite raising $37m from investors as recently as September, it has been caught in a cash squeeze while trying to rotate its business model from selling services to advertising agencies to providing software.
7. …chief executive Mitra … was forced last year into an embarrassing climb-down over his background after the Financial Times revealed he had falsely claimed to have attended the London School of Economics.
Augmented reality startup Blippar enters administration after dispute over funding | Jessica Clark, City A.M. 17 December 2018
8. Blippar has collapsed after an “alleged dispute over continued funding”, administrators at DAVID RUBIN AND PARTNERS said. Blippar is one of the UK’s best-funded tech startups, but has struggled with its business model and low user engagement.
Failed tech startup Blippar to relaunch as Nick Candy's venture firm comes to its rescue | Emily Nicolle, City A.M. 23 January 2019
9. Property tycoon Nick Candy has bought up the remaining assets Blippar ...Already a major shareholder in the business, Candy now owns the intellectual property assets of Blippar and its various brands, which his venture firm said would be deployed into a new business.
10. Blippar's chief executive Ambarish Mitra will remain at the head of the startup, with several former Blippar team members and original engineers also being transferred. ...said the firm would focus on augmented reality (AR) as its most sustainable revenue stream. The startup had previously flirted with artificial intelligence and dreamed of building a visual search engine for smartphones. The statement from Candy Ventures said Blippar would develop an AR creation and publishing platform known as Blippbuilder, enabling anyone to create AR regardless of previous technical experience.