Birthing a nursery business

John Woodward, co-founder of the Busy Bees chain, on his best and worst business decisions...

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Last Updated: 31 Aug 2010

My best decision was investing £150,000 into our childcare voucher business eight years ago - we'd been running the nursery business for more than 15 years by then. We've since turned that initial investment into a £90m enterprise value.

At the time, our investors were very circumspect, because childcare vouchers were taxable, but I believed that this might change. We were lucky - the Government made them non-taxable in 2005, and we became the largest voucher provider in the country. We've just sold that business to Computashare for £90m.

My other best decision was choosing to bank in the early days with the Co-operative. During the recession of the early 1990s, we'd have gone out of business, I think, if we hadn't been with them. We struggled to service the debt, but the bank believed in what we were doing. It had a great MD - Terry Thomas - and I remember him saying to me: 'Judge us by how we support you in the bad times.' We were with them for 10 years.

And my worst decision... In 1989, with the support of the bank, we set up the 'Business of Childcare', a banking package to help people start nurseries. We launched it the week the recession started. We had 5,000 enquiries from people wanting to start nurseries, yet none of them did it because people got into negative equity.

The idea behind the scheme was that you could release funds from your house. So we launched this fantastic scheme at exactly the wrong time. We then had to make the business work during very tough times.

We learnt to be careful about timing. We've had lots of approaches from interesting people, but you have to stop and check if it's the right thing, because sometimes you can get seduced by the momentum. We buy other nurseries, but we've said no to 90% of those we've seen.

I started off teaching in a comprehensive, then went into special education and ended up running a therapeutic community for intelligent disturbed boys - great training for running a business. I loved teaching, but I'm having the best time of my life now.

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