Christmas is the busiest time of year for our business, so we spent the first half of Monday in the office with the team, planning the week ahead and focusing on the essential deliverables. We also met with a venture capital firm who wanted to get a better understanding of the business and our plans for the future – we’re attracting more interest at the moment, as a result of the positive PR that the competition (the Bank of Scotland Corporate £35m Entrepreneur Challenge) has generated. We’re always open to networking, but we are not really in a position to sell at the moment - management are flat out delivering both new websites and product categories, so it would be a major distraction. We’d also be under-selling the business, given the current financial market conditions and its substantial growth potential. The business model is also quite cash-generative, so we've been fortunate to date that we've not had to seek outside investment. Our plan is likely to be to keep focused on running the business for the next couple of years and then see where it's positioned.
But really, last week was all about the competition (the national final of the BoS Challenge) on Wednesday. I spent Monday afternoon and the whole of Tuesday locked in the boardroom going through our presentation. Our business can be difficult to understand, and my worry was that if the judges didn’t get it in the 15 minutes that we had to make our presentation, our chances would be all but over. And our theory was that being Northerners, we might not be as polished as some of the competition who clearly also had very strong businesses! So we put a huge amount of focus into the detail of the presentation, making sure that we got across a number of key messages that we felt could be important to the judges. We also produced a really detailed A5 info pack for the desks, complete with appendices, as well as a 2-minute video clip about the business to get our case across.
The presentation covered our history (because you have to show your entrepreneurial side in getting the business to where we are now); about why we’re in a really good space (we’re a retail business, but in a very high-growth segment); about our business model; and also about how we’re delivering on our growth plans. It was important for the judges to see that although we’re a £27m business now, next year we’re planning for more than £60m turnover – supported by the launch of some new contracts that have already been signed. We’ve got 10 websites launching in the first quarter of next year, including some major brands.
We also talked in the presentation about what winning would mean to us: how we will spend the money from winning the Regional final (a £5m interest-free loan) and what impact Sir Tom’s time would have on our business (Sir Tom Hunter is mentoring the winner for a year). The judges clearly quickly understood the business and were firing detailed and pointed questions at us afterwards – I felt like we did everything we could do to give us a chance of winning, but the judges gave nothing away, and we had no idea how the other finalists had performed.
After it was announced that we had won, about 15 of us went into London afterwards to celebrate, along with my dad who had flown in from Canada to be at the event. Sir Tom was driving back up to Ayrshire, but he sent me a text around midnight to say congratulations and that he would be in touch in the next couple of days. The next day he texted again (asking if the party was still ongoing!). He called me this week and was straight into where he feels we need to be focusing more effort in the business, as well as giving some advice on a few important opportunities we are reviewing. I’ve been following the Woolworths situation quite closely to see if there are any opportunities for us there; he gave me some feedback about what he thought the risks were to the business and how we might address them. Everyone I’ve spoken to says he’s a fantastic, down-to-earth person, and he’ll definitely help in resolving issues and networking – he knows everyone on the high street. We’re going to meet up early in the New Year, once we deliver Christmas trade.
I’ve also been doing lots of interviews in the last week. We’re on a mass recruitment drive at the moment, in every area of the business. We’ve already added 44 people since the start of the year, on top of the 30 we had already, and we’ve just hired a strong FD – but I’m also looking for an IT director, a Commercial Director and a few other management positions. The good news is that there are high-calibre people available at the moment, so we hope to end up with a first-class team. But I think recruitment will be one of my biggest priorities in the next three months; we are a service business at the end of the day, so people are critical to us.
Matthew Moulding is the co-founder and CEO of The Hut Group, which sells a range of products such as books, DVDs, games, lingerie & perfumes through its own retail websites and also on behalf of other retailers, including ASDA, DSGi group and The Co-operative. Last week The Hut won the national final of the Bank of Scotland Corporate £35m Entrepreneur Challenge – their prize was a £5m interest-free loan and a year’s mentoring from renowned Scottish entrepreneur Sir Tom Hunter.