10 Years On…
I’ve just been writing my latest newsletter for Quick Formations, and part of the story for this newsletter is that the company turns 10 years old in September; and the newsletter had a very big risk of turning into a blog. The reason is because I’ve learnt so much, I’ve experienced so much, and I thus have so much to say about what the past 10 years had for me. I feel quite proud to be able to say I own and have run a successful, multi-award winning, business for 10 years and that I do still own it and that it is still trading. So with so much that I feel I have to share, perhaps for this blog post I should start at the beginning.
Quick Formations was not my first business, nor my second actually. I’d dabbled with a bit of buying and selling portable computers (before laptops), fixing and maintaining a few peoples computers and networks, and then my first real company was called Netrotech Limited. A website design company which grew into an ISP (Internet Service Provider) offering internet access, email and website hosting services in the days before broadband. Although that company has a number of success stories, some cracking deals, my real claim to fame is my work I did with a guy in America building the first website where people could bulk buy domain names, sell/trade them, and control them online through a basic control panel. That website was NiceNames, and really led the way with effectively printing money. I’d wake up each money having sold hundreds of domain names overnight and made a small fortune.
That company ran for a couple of years before it was absorbed by a company called Skymarket Limited where I became a Director and Shareholder in return for the shares in my company. I learnt this week that Skymarket sold for over £1,2m this year and my wife asked me whether I regretted leaving there, with nothing, to start Quick Formations. The simple answer is no, because although I may have done quite well out of that deal it would have taken 10 years. That is 10 years of the reasons why I left, which to be honest would have been a stretch. I also wouldn’t have the family life I have now, the business I have now, and of course I wouldn’t have built and then sold UK Business Forums. I’m never one to worry about the What If’s in life, you have to make the decisions you make with the information you have there and then. Once you make it, commit to it and just go. If you spend too much time always looking back and wondering what could have been you’ll likely to crash.
At the time giving up my company Netrotech Limited would seem a mistake, I effectively lost everything at that moment meaning I had to start Quick Formations on a personal bank loan and three credit cards. It hurt at the time, but jump forward 11 years since I lost Netrotech and I’m writing this blog to you now the owner of two companies, investor in a couple of others, and with a great social media success story behind me. Everyone makes mistakes in life, and I’ve made a few such as that one. The secret is not to regret your mistakes but instead learn from them, chalk it down to experience and move on, which I know is easier said than done as I have been there. Take it from a going grey, wise, getting older man who has made a few bad business decisions in his life :).
Anyway, back on track, I made the decision to start Quick Formations despite my accountant advising me not to. He warned me I had no experience in the industry and I should stick to doing stuff on the Internet. Well, my plan was to bring the industry onto the Internet in a big way. My theory was create a software platform that could run a business automatically, customers order online and their new companies get delivered by email direct to them – I wouldn’t need to lift a finger. Oh how the best laid plans go and all that, I should have realised this new venture of mine would lead to me working 20 hour days! A few days ago I read a great blog post by Paul Doran which I highly recommend reading if you are thinking starting your own business is easy, it isn’t.
The plan started with me having a business model based on some knowledge I picked up at Skymarket, I wrote the software requirements, and then put that out to tender. Got three quotes back and development started in June 2002 with it aimed to be finished around October. Well currently a long story short I left Skymarket in August, and the system didn’t go live until December and for the first few months Quick Formations trading activities were IT support, website design, basically anything that would put food on the table! I even did a bit of consultative work still for Skymarket. We actually got our very first company formation order on December 24th 2002 for a company in Flitwick, but when the floodgates were opened it flowed rapidly and by February 2003 I was in real trouble. We were over trading, Companies House wouldn’t give me a credit account as a new business and the bank was holding onto the funds from customers card payments for 3 months as security against Internet payments (the banks got badly burnt by the domain name charge-back fiasco of the late 90’s).
In June 2003 it was my daughters first birthday and I will never forget it. I had taken my family to the level of debt I’d never experienced, we were £49,000 in debt by three credit cards run to their max and a £20,000 bank loan for a “conservatory” which we already had. We had the home phone set for incoming calls only, Sky had been disconnected, I had sold the car, and we were just managing basic food essentials. I felt a complete failure that we couldn’t afford to celebrate my daughters first birthday or even get her a proper present, and felt even worse but eternally grateful when my mother-in-law came round our house and laid on a full birthday party for my daughter. Yet despite this, the cause for all this to happen was the success of Quick Formations and the fact I couldn’t fund it.
The facts of what was happening are explained as this. I had to pay in advance bulk payments to my supplier Companies House for them to hold money on account to pay for the future orders my clients placed with me. My clients paid by card but the bank was nervous as I was an internet business, so they held the payments in security meaning I wasn’t allowed to touch it, and I had to pay for advertising through Yahoo, MSN and Google which I was paying for by credit card. The net result is my profit on paper was great, but my cashflow was all flowing outwards.
I was aware that I was going to go bust at any moment, and I calculated I had about 2 weeks of borrowed money left before I went out of business. So immediately after my daughters birthday I went to my bank, Natwest, and tried to negotiate them releasing my money from security, trying to explain that selling Limited companies was not like selling domain names. They had none of it and said their hands were tied as I was an Internet business, and I was aware that within 2 weeks I would be nearly £50,000 in debt with a bust company. So I walked straight across the road to Barclays with the same paperwork I had for Natwest, and laid it bare to the business manager there. I explained that I didn’t need any borrowing, I have thousands and thousands of pounds sitting in a “security” account with Natwest, all I need is merchant facilities with instant settlement. I also mentioned that if I didn’t get any help from a bank within the next 2 weeks I’d be out of business.
Barclays opened my account there an then, they gave me a quick short term loan to keep me going, and arranged the transfer of my account with Natwest. It’s safe to say that this saved Quick Formations, but the bit that grated me about this whole situation was within a week Natwest transferred all the “security” funds into my Barclays account. So much for security requirements, but anyway that gave Quick Formations a huge cash boost for July 2003. That is when the business turned a huge corner and sky rocketed.
I feel I could write a book of what happened just in those few years alone, so many learning experiences, but I’m going to sign off here for now with the key lessons I’d like to share from above.
My first is don’t have regrets. You will make bad decisions in business and in life, things will go wrong, and people will try to do you wrong. It happens, get over it, and don’t look back. Get on with your own life, do the best you can, and everything has a positive even if you cannot see it right at that time. If you spend too much time being negative it will rub off on those around you, your prospective customers will pick up on it, people won’t want to deal with you and you will spiral into a miserable git. Look forward with an optimistic, but realistic, outlook. You’ll find it refreshing and others will like you for it too.
Secondly, when the world is against you, when everyone seems to be out to put you down, don’t panic. There is an escape route, a path to help, even if it isn’t the ideal route you’d like be realistic and find your escape path. You won’t see it with a mindset of panic though, so when it’s really hitting the fan, when you feel like it will be impossible to stop for a moment and think things through, that is exactly when you must do just that. Step away from the situation, breathe, and with a clear head thing things through and be honest with yourself and those you are dealing with about the situation.
I hope this blog post is of help to someone. When I next have a moment I think I’ll let you know a few more lessons I’ve learnt over the past ten years and what they taught me. Please feedback, let me know your thought 🙂