5. Ask Yourself:
• Are you pricing right?
• Are you over servicing clients?
• Or carrying unnecessary costs?
• Do you make enough margin?
• Do you really need to raise finance?
#finance4SUB
6. Cash flow management
David Brackin
founder, Stuff u Sell
www.stuffusell.co.uk
#finance4SUB
7. Being an
entrepreneur is
like throwing
yourself off a
cliff…
…and building a plane on the
way down
#finance4SUB
#finance4SUB @stuffusell
8. All businesses fail in the same way: they run out of cash
The odds of success
Succeed
Missed stated
target Catastrophic
failure
Very poor returns
#finance4SUB
#finance4SUB @stuffusell
11. Always know how far you are from failure
Doomsday date – a daily discipline
#finance4SUB
#finance4SUB @stuffusell
12. Make sure the plane will fly
Insufficient Margin
#finance4SUB
#finance4SUB @stuffusell
13. Working Capital is the silent killer: fall slower
Too much capital required
#finance4SUB
#finance4SUB @stuffusell
14. Jump off a higher cliff
Insufficient Funding
Cash
Funding
/Credit
#finance4SUB
#finance4SUB @stuffusell
15. Summary
• Daily discipline of cash flow & doomsday date
• Manage your decisions in light of doomsday
• Margins to pull out of the dive
• Working capital to fall less far
• Funding to have a bigger safety margin
#finance4SUB
#finance4SUB @stuffusell
17. JBW company profile
• Founded: 2004
• Employees: 130+
• Turnover: £14m in 2011/12
• Ranked No 26 in the Sunday Times Top Small 100 Company to
Work for
• Main contracts: Transport for London and Child Support
Agency
• Services provided: Debt Recovery and Enforcement
My subject for today is credit and debt
#finance4SUB
18. Giving or accepting credit
• Giving credit –
o Ensure that you can afford for everyone to pay late (as they will)
o have a process and communicate it with your customers
o Outsourcing the process of recovery to a Credit control business, friend or
your partner
• Accepting credit –
o Negotiate suitable terms
o Understand the process before committing or signing anything
o Don not bury your head in the sand
o Make contact and understand your options e.g. VAT office before the cleaner
An early understanding of the rules of engagement will benefit
everyone . A lack of understanding will lead to debt
#finance4SUB
#finance4SUB
19. Understand your terms and what
makes credit lead to debt
• An outstanding invoice or credit agreement is debt, even if its
a day old – so don't kid yourself that it is not
• Example of debts and the recovery process:
o Invoice - County Court Judgement (28 days)
o County Court Judgement – Bad Credit Report (Experian 24 hours)
o Unpaid rent or VAT – Bailiffs, goods removed or property possessed
(without Court permission, 24 hours and only 7 days to pay)
o Unpaid Business Rates – Bailiffs, goods removed (with Court permission,
three months, 7 days to pay)
Understand the process of enforcement before you give or
accept credit - simple
#finance4SUB
#finance4SUB
20. What to do if you become the creditor
or the debtor
• You are the creditor –
o Hold your head up high
o Refer your customer to the process (you shared this with them)
o Make immediate contact (those that scream the loudest)
o Explain the impact upon you (pull on the heart strings)
o Take action.
• You are the debtor –
o Create a debtor plan, who do you own money to and how much
o Make contact (early as people don’t like to be the chaser)
o Share your plan, understand other options e.g. administration etc
Debt does not go away and people know that. Don't be shy, but
also not be naive
#finance4SUB
#finance4SUB
21. Useful information
• Late Payment of Commercial Debts (Interest) Act 1998
• www.moneyclaimonline.co.uk
• www.payontime.co.uk
• www.hmcts.co.uk
• www.jbw.co.uk
My experience of debt is:
o Everyone has it (footballers, FTSE 100 firms and the Government)
o Some manage it better than others
o I personally enforce over 20,000 debt orders a month and 98% pay
Communication is the answer to it all
#finance4SUB
22. Panel Q&A
Host: Oli Barrett
Panellists: Duncan Cheatle,
Jamie Waller and David Brackin
#finance4SUB
#finance4SUB
23. Networking
Host: Oli Barrett
#finance4SUB
#finance4SUB
24. friends, family & corporate
Alex Cheatle
Founder and CEO, Ten Group
#finance4SUB
27. The Ten Mission
We exist to earn and deserve
the trust of our members
through regular, successful,
personalised experiences
and we use expert people
and knowledge management
to make our business better
as it gets bigger.
#finance4SUB #finance4SUB
28. Specialist Pioneering Intelligent
teams of experts information support services
sharing
#finance4SUB #finance4SUB
52. Pitch for funds
Networking
Have a clear proposition
Soundbite
Plan your exit
People
#finance4SUB
#finance4SUB
53. The deal structure
£700k investment
Equity eg £20k
Debt instrument eg £680k
1st charge
High interest
#finance4SUB #finance4SUB
54. Institutional Investors
Gordon Christiansen
CEO, Colway
www.colway-limited.co.uk
#finance4SUB #finance4SUB
55. Introduction Introduction
• Family business until 1990
• Corporates until 2004
• GM / CEO since 1997
• Current business since 2004, MBO 2006
• Debt / equity deal
– Restructured 2009 & 2012
#finance4SUB #finance4SUB
56. Colway group
Colway group
£24m turnover, £1.6m EBITDA, 155 staff, 7 London locations
Inspiring seriously creative people
Retail art and graphic materials. 4 stores in London, + mail order
and on-line
Expert’s choice for creative technologies
Workflow and digital colour output for media services and design
businesses
Making offices work
Office Supplies, Catering & FM, Computer Supplies, Document &
Data Storage, MPS, Printed Media, Studio Supplies,
Delivering value for workplace investment
Office interiors, space planning, workplace furniture, consultancy
#finance4SUB #finance4SUB
57. Who are they? are they?
Who
• “High Street” banks
• Foreign banks – corporate divisions
• Merchant banks
• Asset Back Lenders (ABLs)
• Private Equity / Venture Capital
• Public – AIM, London Stock Exchange
#finance4SUB #finance4SUB
58. Getting ready
Getting ready
• Professional advisor (s)
– Investors are used to dealing with advisors
• Balanced management team
– CEO, CFO ++
• Excellent business plan
– Information Memorandum; tell the story
• Brush up your presentation skills
– They buy you, be credible
#finance4SUB #finance4SUB
59. Managing the relationship
Managing the relationship
• High quality financial information
– Monthly packs, agree the format
• Regular reviews
– Board meetings with agenda and minutes
• Updated and accurate forecasts
– Re-look at your numbers regularly
• No surprises
– Basically, they hate them
#finance4SUB #finance4SUB
60. Lessons learned
Lessons learned
• They need you more than you need them
• They are not your friends
• Always have more than one option
• Negotiate hard – fees, covenants
• Seek advice; speak to people you trust
• Never sign Personal Guarantees
• Strike a Work:Life balance
#finance4SUB #finance4SUB
61. Panel Q&A
Host: Oli Barrett
Panellists: Alex Cheatle, Owen
Davies & Gordon Christiansen
#finance4SUB
#finance4SUB
62. End of morning session
If you would like any further information about the speakers, The Supper Club or
StartUpBritain then please feel free to contact us on either marie@thesupperclub.net
or lorna@startupbritain.org
#finance4SUB
#finance4SUB
