Wednesday January 1st 2020
TDR | Lyst £11m | Brand Addition | Mortgage Brain £7.2m | Papier £2m | Mindmate | Snap40 | Professor Puzzle £8m | Gear4music £56.1m | Starleaf £70m
News about 10 UK growth companies and/or accelerators + turnover in the GRID marketplace 7th – 13th May 2017:
TDR: flat-pack home solution | The Sunday Times, May 7
DZ profile: Tdr Capital Llp
Business: private equity firm
Location: London W1
Founders: Manjit Dale and Stephen Robertson
News: TDR Capital is pumping £8m into bolt-together homes to help solve the housing crisis. … is in talks with housing associations to sell modular dwellings built by its new ILKE HOMES offshoot. The units are manufactured in a factory in East Yorkshire, then taken by lorry and bolted together on site. TDR also plans to open three new factories to make the homes, and can install 10 buildings a day. The project is a venture between housebuilder KEEPMOAT and modular buildings firm ELLIOTT, both owned by TDR.
LYST: plays Trump card | Kiki Loizou, The Sunday Times
DZ profile: Lyst Ltd
Business: Online fashion retailer with 12,000 fashion brands – including Yves Saint Laurent, Michael Kors, Topshop and Zara - on a single, online platform. It has 65m visitors, of whom 60% are in America. “Much like Skyscanner or Trivago, which make searching for flights and hotels easier, Lyst helps fashion shoppers find and buy that ‘must-have’ sweater they saw on Instagram,” Morton said.
Location: Hoxton, London N1
Founder: former venture capital investor Chris Morton, 34.
Financials: reported a 60% rise in revenue to £11m. Losses halved to £6m in the 12 months to the end of March. There was an 86% spike in sales of Ivanka Trump’s clothing line after the November election.
Investment: has the backing of venture capital firms ACCEL PARTNERS and BALDERTON CAPITAL.
News: plans to expand into Japan and Canada in the near future.
BRAND ADDITION: Manchester marketing star sold for £60m | Aimee Donnellan, The Sunday Times
DZ profile: Brand Addition Limited
Business: consumer and technology firm which makes promotional merchandise for companies such as Clarins, Calvin Klein and Google. Also makes Pudsey bears for the BBC’s Children in Need appeal.
Staff: employs 300 people throughout Europe, Asia and America. The company is run by Chris Le
Investment: It was bought by American private equity house HIG CAPITAL from 4imprint for £24m in 2012.
1. is to be sold ..HIG CAPITAL is expected to complete the deal this week, selling the business to rival ELYSIAN CAPITAL and the company’s management ...for £60m.
2. It was featured in the 2015 Sunday Times International Track 200, which ranks Britain’s medium-sized private companies with the fastest-growing sales.
MORTGAGE BRAIN: Banks to reap £50m from fintech sell‑off | Daniel Dunkley and Aimee Donnellan, The Sunday Times
DZ profile: Mortgage Brain Limited
Business: software developer. It started as a mortgage search tool for brokers, and now offers software to help lenders with compliance, transactions and data analysis. It also has a consumer price comparison app — the first of its kind developed in Britain. It has 20,000 customers and handles more than 200,000 transactions each year.
Staff: 100 people across offices in Worcestershire and London.
Financials: Post-tax profits were £2.3m on revenues of £7.2m in the year to March 2016
Investment: co-owned by Barclays, Lloyds, Nationwide, RBS, Santander and Virgin Money
News: Britain’s six biggest mortgage lenders are set to share a windfall of at least £50m after putting a financial technology business up for auction. Mortgage Brain is working with advisers from Deloitte on a potential sale. Deloitte is believed to have approached private equity firms over a possible deal. …the company could fetch between £50m and £100m, with talks at an early stage.
PAPIER: Stationer pushes the envelope for exports | Laura Onita, The Sunday Times
DZ profile: Papier Ltd
Business: online stationery store which sells personalised greeting cards, notebooks and wedding invitations in more than 35 countries. Papier has dispatched more than 1m products. A personalised children’s book costs £18.
Location: Soho, central London
Founder: former management consultant, Taymoor Atighetchi, 28, whose family moved to London from Iran.While he was at Cambridge, the art history student squeezed in founding The Tab, a news website that has since gone global, giving him experience in building a brand. ...joined consultancy firm Bain ...Three-and-a-half years later he quit and created online stationery and card company Papier.
Financials: Atighetchi said the business had grown 40% a month since it was founded and had annual sales of more than £2m. “Profitability is something we can achieve if we want to, but right now we’re reinvesting,” he said.
Investment: has won £3m of investment to fuel expansion overseas from venture capital firm FELIX CAPITAL, which also owns a stake in the luxury fashion business Farfetch, and from JAMJAR INVESTMENTS, the fund set up by Innocent Drinks founders Richard Reed, Adam Balon and Jon Wright. Atighetchi, 28, remains Papier’s largest shareholder. In 2015, received £250,000 start-up capital from a consortium of angel investors including Charles Tywhitt founder and Bain alumnus Nick Wheeler after Atighetchi contacted him via LinkedIn.
1. The cash will be used to diversify into homeware or fashion and to sell to more countries.
Bringing a personal touch to stationery, the Papier man who likes to push the envelope | Clare Hutchison, The Evening Standard. July 17, 2017.
2. He developed the idea for it after identifying a gap in the stationery market between the likes of Smythson and mass-market operators such as Moonpig and spotting that other sectors like coffee were moving towards premium products.
3. After hiring a tech team and marketing director, many of whom came from his university network, he set a four-month deadline to build the business and the tech that powers it from scratch.
4. At present Atighetchi and his team remain on the look-out for exciting designers and artists to work with, but there are also bigger plans afoot. Atighetchi is .. proud of Papier’s flat structure ...and perks such as the £40-per-month “cultural allowance” doled out to staff. There are also bi-weekly “school trips” to galleries or museums to “keep everyone visually engaged”.
5. Papier will launch an Australian offshoot in September and a US expansion could be on the cards.
So which start‑up is going to be the next Skyscanner? | Kiki Loizou, The Sunday Times.
DZ profile: Mindmate Ltd.
Business: app that helps people with dementia and helps sufferers train their brains and provides medication reminders.
Founders: Roger Arellano, Susanne Mitschke, 27 and Patrick Renner
Investment: one of New York’s best-known accelerator programmes, TECHSTARS, has invested almost £100,000 in Mitschke’s project, and she has now raised more than £1m from mostly US-based backers.
News: Mitschke said she and her co-founders, who are also foreign nationals, worry that they may be “kicked out” after Brexit.
DZ profile: Snap40 Limited
Business: in 2014 developed an armband that transmits data from patients to doctors. The device and its associated software allows medical professionals to monitor patients while in hospital.
Founder: Christopher McCann, 27
Investment: has just raised £2m from early-stage investor PAR EQUITY
PROFESSOR PUZZLE: It all worked out on the streets of Calcutta | Laura Onita, The Sunday Times
DZ profile: Professor Puzzle Limited
Business: its metal and wooden games and puzzles are sold in 40 countries via about 750 stockists, including Marks & Spencer, Tesco and American bookseller Barnes & Noble. A typical toy — a “brain busting” set of six metal puzzles — costs £10. The original games product was bought for £10 from a street hawker, whilst travelling in Calcutta in 2000. Then started selling at a stall in Covent Garden market.
Location: Twickenham, southwest London
Founder: Ben Meldrum
Financials: pre-tax profits of £1m on sales of £8m last year. Expects sales to reach £15m this year.
1. Exports rose to £3.5m in 2016, earning Professor Puzzle a place on the latest Sunday Times SME Export Track 100 list of companies with the fastest-growing international sales.
2. In 2010, he outsourced manufacturing to China. “We could suddenly make far more products and focus on selling rather than just making stuff.”
3. …is due to open an office in Chicago in the next few weeks
GEAR4MUSIC: hits all the right notes as annual sales and profits boom on international growth | Courtney Goldsmith, City A.M. May 9
DZ profile: Gear4music Limited
Business: The UK's largest online musical instrument retailer
Founder: Chief executive, Andrew Wass
Financials: pre-tax profit for the year to the end of February was £2.6m, nearly 200 per cent up from profit of £6,000 the previous year. Total revenue increased 58 per cent to £56.1m, driven by improved margin performance. In the UK, revenue was 34 per cent higher at £34.8m, but the international market was the real show-stopper with revenue up 124 per cent at £21.3m.
Investment: floated on AIM in 2015.
1. The number of visitors to Gear4music's website increased to 12.6m from 10.1m the year before, while active customers grew to 340,000 from 226,000.
2. Over the year, the group …worked to build the infrastructure it needs to accelerate growth in the medium and longer term as it expands further abroad into a "truly global" business. The firm opened distribution centres in Sweden and Germany to enhance European customer proposition, and since the period ended, Gear4music has also acquired a 50,000 square-foot freehold property in York that will become the group's new office with capacity for further expansion.
STARLEAF: Highland Europe leads $40m investment in UK tech startup making video conference calls loads easier | Lynsey Barber, City A.M. May 9
DZ profile: Starleaf Ltd
Business: high growth startup specialising in video conference calling technology. The firm's technology provides cloud-based voice and video conferencing and can connect everyone on a call even if they are using different software, such as Skype for business or Cisco. Its clients include MERCEDES, TATA and TRAVELEX. It signed up more than 150 new clients with more than 1,000 staff last year. It plans to double that over the next 18 months … as well as focusing on expanding the business in Asia Pacific and further growth in Europe and North America.
Location: London. Cambridge-founded
Founders: Mark Loney, chief executive, Mark Richer and William MacDonald - serial entrepreneur founders, who previously sold phone technology company CALISTA to Cisco for $55m and CODIAN to Tandberg for $270m.
Investment: HIGHLAND EUROPE has led a multimillion pound investment - $40m (£31m) from the venture capital firm which has previously invested in Brandwatch, WeTransfer and Outfittery - along with GRAFTON CAPITAL. It's the first outside funding for Starleaf.
1. “Enterprises are shifting towards video as it is a much better means of communication than a voice call or conference," said Loney. "However, businesses often have a variety of legacy systems making it difficult to connect with customers and suppliers who may have different systems. Our cloud service solves these issues, while taking away the pain of running your own back-end systems. This new funding will take us through our investment phase and give us the working capital we need to reach our potential in markets around the world.”
2. StarLeaf was one of the Deloitte Fast 50 fastest growing tech companies for two years running, along with the likes of SKYSCANNER, WORLDREMIT and FARFETCH, with a growth rate of 1860 per cent in 2016
ON THE BEACH: North of England has digital success | Andy Bounds and Chris Tighe, FT. May 13
DZ profile: On The Beach Limited
Business: sells a fifth of online short-haul beach breaks in the UK
Financials: increase revenue by 7 per cent in the first half. People booked later and paid more, boosting sales to £38.1m in the six months to March 31, up from £35.5m last time. Pre-tax profit rose by a third to £9.9m (£7.4m). ….increased revenue by 12% to £70m in the year to September 30th 2016. Revenue, after marketing costs, increasing by 18% to £36m
Investment: Private equity firm INFLEXION sold half of its shares for £42.9m in April, but still has a 11.8 per cent stake.
1. Its Swedish arm took in £600,000, leading it to open operations in Norway.
2. On May 10 the company acquired rival online travel agent, Sunshine.co.uk, for £12m. It will add about 200,000 customers to On The Beach’s existing 1.2m.