Karen Penney, VP global commercial payments, American Express
Kate Bassett, head of content, MT
Bassett: As entrepreneurs growing businesses, what’s keeping you awake at night?
Porter: I’ve realised you’re only as good as the team around you. I worry that they’re okay, that they know what they’re doing and when they need to do it by. As you grow, you lose control of that. Culture is incredibly important.
Bassett: How do you keep that culture as you grow?
Porter: You’ve got to be all over your business. You are the business, that’s what the culture is. You’ve just got to make sure you’re constantly checking in with everyone and listening to them, because they can tell you a lot about your business that you don’t know.
Jervis: I completely agree. When there are only 10 people, you have a lot of contact as a founder, but when you get to 30 and there’s people constantly joining, you have relatively little time with them. We still have our big core team meetings, but we also have smaller teams now too, each with their own objectives. As a scrappy entrepreneur that can be a bit of challenge – at your heart you feel it’s getting too bureaucratic, but it’s necessary.
Clarke: When you’ve got a few people, you’re like a family. We just doubled our staff this summer. It’s really hard to get new people to understand your vision.
Relf: Being the founder of the business, you have that engrained passion already, which unfortunately means you’re comparing other people’s passion to your own, and you often feel disappointed.
Clarke: That’s why you’ve got to make sure your rewards are right. You have to incentivise people. We’re sales driven – commission can be a great leveller in this world.
Bassett: Does funding become more difficult as you grow?
Rhodes: Our business has grown very quickly over the last 18 months - our beers are now available at over 1,000 outlets nationwide. But we’re not a cash rich company. Major national customers are on 90 day terms so it’s a struggle – it’s not like you’re accumulating cash as you go. We either had to take a step back and grow organically, not taking on any new customers, or take on investment and grow the team. We’ve had some private investors, who’ve been brilliant, and we’re just launching a crowdfunding project with Crowdcube.
Clarke: Cash flow can be a tricky one, particularly since Brexit, as we buy everything in dollars. We had about £200,000 knocked off our gross margin this year, just from exchange.
The traditional high street banks are not really that interested in small businesses. They’ll give you your overdraft, but over and above that there’s very little room to manoeuvre. We’ve got a very seasonal trade. Most people get married in the summer and it will take nine months for the wedding dress to come through, so you have these big periods of the year when you basically don’t sell anything, then you sell it all at once.
We use all the Amex platforms as well as normal bank accounts, crowdfunding, merchant account services, credit cards and foreign exchange. Depending on the day of the month, you sometimes have to swap between your various funds as well.
Bassett: Ed, you’re expanding Laundrapp abroad. What approach have you taken?
Relf: We’re taking the tech that we’ve built, the platform and business model, and licensing it around the world. We launched first in New Zealand earlier this year, and we’ll be in 15-20 international markets by the end of next year.
Licensing is a fantastic model. You don’t have the bureaucratic headache of having satellite offices, and if it works it has high margins and low overheads, which makes it incredibly attractive to investors.
Bassett: Why did you start with New Zealand?
Relf: It’s a soft launch. We knew we needed to internationalise, so we picked a market that’s comparable in language and as a place to do business, and tested it there first. That way if something doesn’t work, we’re not burning a huge market like the US.
Bassett: As founders, have you seen your role change, as your business has grown?
Jervis: I think about that regularly, what my role should be. I’ve brought in senior people to grow Clickmechanic, and when you’ve got senior people, you’ve got to trust them and empower them. So my role has changed. I’m focused more on culture, processes and investor relations now.
Penney: You have to learn to delegate. When you start a company, you do absolutely everything – from interviewing every new member of staff, to running the marketing campaigns. For every entrepreneur, there’s that moment when you realise there’s something really important that you either spend all your time doing to the detriment of everything else, or you bring someone in.
Relf: You need a good sense of humility – I know what I’m not good at, and I hire for my weaknesses. Finance has always been a weakness for me, so hire a great CFO. I like the daily hustle of getting businesses growing, so I need a great COO to build the strategy. It’s largely just about being honest.