Thursday February 14th 2019

Thursday February 14th 2019

News about 13 UK growth companies and/or accelerators + turnover in the GRID marketplace, 9th – 15th October 2016:

Ted Baker £255m | Human Race | Sonovate | WorldRemit £27m | Tool Shop £3m | Bulk Powders £15.9m | Curation | Ping Pong Restaurants £15m | Abercrombie & Kent £51.3m | Gieves & Hawkes £15m | Luceco £125m | ComplyAdvantage | Abokado

TED BAKER’s American dream | Peter Evans, The Sunday Times. October 9
DZ profile:
Business: fashion house

Launched: 1988
Founder: chief executive, Ray Kelvin, 60, who owns 35% of the company, started working at his uncle’s menswear shop in Enfield, north London, at the age of 11 and quickly branched out to his own stall.
Financials: The retailer is expected to reveal first-half profits of £20m — an increase of 13% on the previous year. Revenue is forecast to be £255m.
Investment: The business listed in 1997 with a value of £56m and is now worth £1.1bn.
News: Ted Baker has expanded outside Britain since floating nearly 20 years ago and now has 448 stores worldwide. It generates more than 40% of its sales abroad. Sales in North America expected to more than double to £185m in the next five years. Revenue from Asia is forecast to grow at a similar rate, although sales growth in Britain will be much slower.

Tour de France owner buys UK events team |The Sunday Times

HUMAN RACE
DZ profile:
Business: British organiser of big running, cycling and swimming events, such as the London Winter Run. Over the past six years, the business has grown significantly as mass-participation events, such as triathlons, have become increasing popular.
Launched: 2010
Location: Surrey
Founder: Nick Rusling, a former executive at sports and film star agency IMG.
Investment: France’s AMAURY SPORTS ORGANISATION (ASO) - owner of the Tour de France, the Dakar Rally and L’Equipe newspaper - has bought Human Race France’s Amaury Sports Organisation (ASO) - owner of the Tour de France, the Dakar Rally and L’Equipe newspaper - has bought Human Race from venture capital firms EPSILON PARTNERS and CALCULUS CAPITAL.Human Race first worked with ASO, owned by the wealthy Amaury family, when the British company helped organise the Tour de Yorkshire Ride, a legacy of the 2014 Tour de France.

SONOVATE
DZ profile:
Business: technology start-up that aims to shake up the recruitment industry. Provides short-term funding to recruiters that place contract workers into large corporations.
Location: London and Cardiff
Staff: 100
Investment: Has secured the raised £14m of fresh investment from Berlin-based Rocket Internet. The fundraising is thought to value Sonovate at more than £50m. Previous backers have included Dawn Capital, a venture capital firm that has put money into fantasy sports site FanDuel and digital payday lender Wonga.

WORLDREMIT: Fintech boss who moves cash all over the world | Simon Duke, The Sunday Times.
DZ profile: Worldremit Ltd.
Business: remittance business. WorldRemit’s smartphone and tablet apps enable immigrants to wire money more cheaply and easily than through the likes of Western Union. Senders must have a bank account; and it does not allow customers to turn up at a high street exchange with a suitcase of cash. More than two-thirds of all transfers are paid electronically, either into recipients’ bank accounts or, increasingly, onto their mobile phones. The system leaves an indelible audit trail. It is also cheaper than bricks-and-mortar rivals; Ahmed says his charges are less than half those of his competitors. WorldRemit is growing fast and handling more than 500,000 transactions a month, up from 300,000 in January.
Launched: 2009
Location: offices in Victoria, central London UK, the US and Australia
Founder: Somali-born, Ismail Ahmed, 56, has retained about a fifth of the company. With a doctorate in development economics, he worked in academia and non-governmental organisations before becoming an entrepreneur. After a UN ethics committee investigation, he received a large compensation payment for lost earnings…which provided the seed investment for a remittance business Ahmed had set up months before.
Financials: WorldRemit’s revenues are growing at a healthy clip, from £15m in 2014 to £27m last year and a projected £42m this year. However, it continues to lose money as it expands its service. Ahmed says the company is “getting close to breakeven” and does not need to raise any more cash. .... earlier this year the company secured a $45m line of credit from US growth fund TriplePoint Venture Growth and Silicon Valley Bank.
Investment: Backers who have pumped in nearly $200m include venture capital firm ACCEL PARTNERS, an early investor in Facebook. Now worth about $500m (£405m). Ahmed predicts WorldRemit will be in a position to consider a stock market float in a couple of years. Seed funding - £200k compensation from UN as a whistleblower on corruption in the UN Development Programme. Raised $100m in a funding round last year based on a valuation of $500m, just six years after it launched. A lot of money is needed to enable WorldRemit to gain licences to send cash between different geographic locations
News:
1. the potential rewards are substantial. Each year migrants wire an estimated $600bn (£482bn) to their homelands. The industry is highly fragmented: the 165-year-old Western Union — worth almost $10bn — is the biggest player but processes only 18% of global remittances.
2. The fall in the value of sterling has made it cheaper for WorldRemit to hire engineers here than in America, according to Ahmed.

TOOL SHOP: Shopkeepers are raging over the revision of the business rate | Kiki Loizou, The Sunday Times.
DZ profile:
Business: hardware chain with 11 London stores and a warehouse
Launched: 1997
Location: London
Founder: Vin Vara, 56,
Staff: 36
Financials: revenues of almost £3m
News: has been forced to hand in notice on his flagship shop in Waterloo. He predicts his total rates bill could rise by £34,000 to more than £150,000. Also has“…pension contributions coming, the London living wage and rent rises on three of our properties.”

BULK POWDERS: Student bodybuilders bulked up by selling proteins to gym fans |Laura Onita, The Sunday Times
DZ profile:
Business: set up a website that sold imported products protein supplements for bodybuilders and 2 years later started their own range of nutritional supplements. Britain is its biggest market, and the company sells to customers in 13 countries on the Continent. The key ingredient in many of the products is whey protein, a by-product of cheese-making. The challenge is to make it taste good. The website also offers items such as chia seeds for superfood lovers. Customers can buy Bulk Powders branded vests, T-shirts and jogging 
Launched: 2004
Location: Colchester, Essex
Founders: Adam Rossiter, 33, and Elliot Dawes, 34.
Staff: 100
Financials: Last year reported profits of £470,000 on sales of £15.9m and expect revenues to hit £25m this year.
Investment: Dawes and Rossiter own 98.8%. Last year they sold 1.2% to the chairman, veteran investor Robert Easton.
News: The company earned a place on The Sunday Times Fast Track 100, the league table of private companies with the fastest-growing sales over three years.
Their immediate aim is to expand into America and more European countries.

CURATION’s alerts backed by ex-news agency chief | Nic Fildes, FT. October 10
DZ profile:
Business: British start-up providing its own breed of news alerts, warning companies of peripheral risks to their businesses that may have gone unnoticed. Curation uses algorithms to unearth stories from 1.2m sources, with a team of curators adding insight to the alerts. The company already works with BP, KPMG and a host of hedge funds to create bespoke alerts that can warn clients of risk factors and which go beyond the regular news feeds set up for their core businesses. Curation charges £10,000 a quarter for its detailed trend-spotting alerts service, although clients will be able to reduce those prices in the future if they share the information with other companies.
Launched: 2012
Founder: Nick Finegold, after he sold his stake in the stockbroker Execution Noble. He founded Execution in 2001 and merged with Noble in 2010. Later that year, Portugal’s Banco Espirito Santo bought a majority stake in his company for £50m.
Investment: His brother Warren, the former head of mergers and acquisitions for Vodafone, has also invested in Curation. Curation has raised £1m as part of the new funding round, but expects to be cash generative in the fourth quarter as more companies sign up.
News: Tom Glocer, who spent 11 years as chief executive of Reuters and Thomson Reuters and now runs Angelic Ventures, has backed Curation. He will also become chairman of an advisory panel of experts that will help define Curation’s feeds and what trends to spot. Curation is one of a number of new-generation media companies looking to mine data for insights. Mr Glocer last year backed Dataminr, which trawls through Twitter and other social media sources to spot news or trends that have yet to surface in traditional media.

PING PONG RESTAURANTS: swings to loss on triple threat of terror, Brexit and competition | Alex Lawson, Evening Standard. October 12
DZ profile:
Business: dim sum chain, which has nine restaurants across London including in both Westfields.
Launched: 2005
Staff: chief executive Art Sagiryan
Financials: Pre-tax losses hit £545k in the year to March 27, 2016 after a profit of £19k the previous year. Revenues were flat at £15m.
Investment: privately-owned by Russian Igor Sagiryan
News: Ping Pong said consumers have avoided shopping centres since the Paris attacks in late 2015, denting its takings, and also blamed “an increase in the use of delivery companies” such as Deliveroo.

ABERCROMBIE & KENT: sales boosted by Brits wanting luxury trips abroad | Joanna Bourke, Evening Standard. October 12
DZ profile:
Business: luxury travel firm
Financials: turnover climbed to £51.3m from £45.9m in 2014. Pre-tax profits decreased to £517k from £830k the prior year, which the firm blamed on investments in marketing and staff.
News: Sales have surged 12%, helped by Brits taking long-haul trips to South Africa and the Far East. Other popular destinations included Ecuador and the Indian Ocean. There was weaker demand for East African destinations owing to concerns over the Ebola epidemic.

GIEVES & HAWKES: strikes gold in London during China's Golden Week | Joanna Bourke, Evening Standard. October 12
DZ profile:
Business: Tailor and Royal Warrant holder which has dressed Princes William and Harry. Has branches in Savile Row and concessions in Harrods and Selfridges.
Launched: 1809
Location: London
Staff: Ray Clacher, managing director
Financials: losses were trimmed to £520k in 2015 from £820k in 2014. Sales slowdown to £15m from £18m in 2014; blamed the fall on store closures in Bicester and Birmingham.
Investment: owned by Hong Kong’s Trinity

LUCECO: £200 million float to spark London's IPO market | Jamie Nimmo, Evening Standard. October 12, 2016
DZ profile: Luceco Plc
Business: electricals business which makes LED lights, plug sockets and wall mounts for TVs. Products also include wiring accessories and portable power cables, as well as TV wall mounts.
Staff: Chief executive John Hornby, Who is one of its largest shareholders with a 20 per cent stake. 
Financials: has annual sales of more than £125m.
Investment: In 2005, EPIC Private Equity, which also owns upmarket tea maker Whittards, invested just £4.3 million in a management buyout of Luceco, then known as Nexus Industries.
News:

1. owners planning a £200 million float. The firm will sell around half of its near-50% stake, pocketing £50 million from the share sale, which could be as early as next week. The £25 million proceeds from the float, being run by stockbroker Numis, will be used to halve the Telford-based company’s net debt.
is also expected to enjoy a multi-million pound payday.

UPDATE:

UK supply-chain groups focus on growth opportunities | Michael Pooler, FT. January 11, 2019

2.  Since floating on London’s main board at a price of 130p just over two years ago, the stock has lost about three-quarters of its value to trade at 34.6p, giving the company a market capitalisation of £55.6m. Behind a sharp drop in the shares in late-2017 was an accounting mistake — the incorrect assessment of the value of stock — that led to an earnings downgrade.

3.  half-year pre-tax loss of £4.1m in the period ended June 30, while revenue declined slightly to £75.1m. Even so, management sounded a positive note in September by saying it expected an improvement in the group’s financial performance with a return to profitability.

COMPLYADVANTAGE: This UK startup using AI for compliance just raised millions | Lynsey Barber, City A.M. October 13
DZ profile:
Business: UK tech startup which uses artificial intelligence to ensure compliance rules are followed by financial firms. The regulatory tech firm, or regtech (an offshoot of fintech), uses AI and machine learning to monitor risk and already boasts 200 clients.
Location: London. Will open an office in New York this week
Founder: Charles Delingpole, who also co-founded fintech startup MarketInvoice
Staff: 50.
News:
1. Has raised $8.2m (£6.7m) in a series A round of funding led by Balderton Capital to fuel expansion into the lucrative US market."In compliance, we see lots of entrants with a new workflow, or user-interface tool that is just repackaging the same data. ComplyAdvantage is doing something different, by developing its own proprietary global data set of individuals and companies that pose a threat," said Balderton general partner Tim Bunting.
2. Regtech is an increasing focus for fintech startups amid increasing regulation in the wake of the financial crisis and the introduction of KYC (know your customer) and AML (anti-money laundering) rules. It is also a focus of the Financial Conduct Authority as part of its fintech sandbox and Project Innovate schemes.

ABOKADO: Avoid a staff gaffe: Take on top talent the easy way | Elliott Haworth, City A.M. October 13
DZ profile:
Business: health food chain that is currently opening a new store every six to eight weeks.
Founder: Mark Lilley
Staff: around 250