10 Years On… Part 2
Following on from my previous post, which I’m pleased seems to have been very well received, I’m going to continue from July 2003 and what the next couple of years had in store for me up to the beginning of 2005. If you haven’t already read the start of this story, you should get up to speed with starting 10 Years Later…Starting Quick Formations.
Missing from my earlier blog post mentioned above was that during those early months of 2003 I had received three offers to buy Quick Formations, a company that was on the verge of going under despite doing a stonking volume of trade. I was forming more than a couple of hundred Limited companies a day, from my kitchen, so on one hand I knew something was going well but I still couldn’t understand why the such prompt interest to acquire my new business. This interest made me realise I had something but I didn’t know what, but it gave me the determination to plough onwards.
I had also started doing a bit of I.T. consultancy and development under the name of Ozzy IT to get some money coming in previously, not much although I did start doing some work for the World Health Organisation and DfID via an agency…who ended up not paying my final bills, going into administration, and stinging me for just over £3,000. Thankfully, by the time this happened Quick Formations was back on track and I was grateful for having less consultancy work and more time to spend on Quick Formations.
The relief my wife and I had after that meeting with Barclays was amazing, and with all this money now in the business account I started pushing our Internet advertising even further. In those days Google Adwords was pretty big, but the best converting advertising was with a firm called Overture (which later was purchased by and became Yahoo’s Pay Per Click advertising channel). That is where most of my money was spent, but initially there was only two advertisers on there for company formations, my firm Quick Formations and another company who appears to no longer be in business (I did try and find them to provide a link here).
What was interesting in Overture is that you could see your competition and what their highest bid was on a search term, and then you could outbid them if you wished. This led to me and this other firm outbidding each other until we reached silly figures per click, so in the end I rang the guy up and we agreed to swap weeks. One week I would be number one on MSN Search, the next week he would be, and so on. It worked great, we saved a fortune in PPC and each Monday we modified our bids and swapped positions, the end result being we both made more profit.
Shortly afterwards @UK PLC started doing Pay-Per-Click and they joined our party for a couple of weeks, but very soon again someone else started, and another, and so on. The other chap rang me up and we agreed it wasn’t going to work any more so we started doing our own thing. It was great whilst it lasted though, despite perhaps this sort of thing not being in the search engine’s favour ;).
It was around this time that I realised I couldn’t solely rely on Pay-Per-Click advertising, so I started spending more time doing promotional activities using skills I’d learnt from my previous business. Taking part in mailing lists, newsgroups, online discussion forums, all things that today have become known as Social Media. What was to my advantage though was that this sort of marketing activity was completely alien to everyone else in the company formation industry. Within a few months I’d created a huge online presence for Quick Formations, and my website was being recommended by hundreds of people a week, creating thousands of inbound links to my website. By chatting to people online and answering their questions publicly I’d created a human face to an online business.
It was then that I had the idea to enter some business awards, strangely feeling very confident that I would get some awards for it too. The first was the National Business Awards, where I made it as a Regional Finalist for the Best Use of Technology. I was gutted, being someone who is very driven and hungry for success, not winning felt like a failure. Still, I entered some more and spent more time working on the application process, this time understanding what the judges were looking for and how to word my answers appropriately.
I’d also started thinking about what all these new companies I was setting up might need, and what experience I had in various sectors to start offering them. The first was telecoms services, I had experience of working in the telecommunication sector having initially done much of the setting up of Skycom and I’d learnt a bit about it with my previous Internet business too. I was also aware many of these businesses would be one-man bands like I was, so things like 0800 phone numbers and Fax-2-Email services would be quite interesting. So I set-up Quick Telecom and piggy backed on the back of a Telecoms company called Inweb who’s owner I knew from old (although he has since sold out to Edge Telecom now GCI Telecom. I met Andrew the owner for a beer to which he broke it to me, if he’d know Netrotech was up for sale he would have offered me half million for it. Oh that was great to hear – not!). This Quick Telecom venture went like hot cakes, mainly the Fax-2-Email service and it was such easy money. I did next to nothing and earned a revenue share from Inweb.
A few month later I met a guy who has since become a very good friend and business partner of mine with New Start Data, a chap by the name of Dan Hancocks. He was a sales manager for a company called Wyse Assist, although following a Management Buy-out he now owns that company in partnership with a man by the name of Richard Hogarth and they renamed the business to CoCredo (Co for Company and Credo being Latin for Trust). He put the proposition to me to offer company search and credit vetting services, and thinking small businesses would want to check the credit worthiness of their clients I set-up a Quick Credit Reports. In this case just because I had been stung this turned out not to be such a great hit but I kept it going anyway.
I also started heavily promoting participation in UK Business Forums to my customers who used Quick Formations to form their companies, encouraging them to network online for support and finding new clients. It worked a treat and the membership of this other guys support forum began to grow.
Unfortunately, around early 2004 the sharks started coming out of the woodwork. I’d noticed that I’d started getting a lot of web traffic from the same broadband IP Address for a company formation agent based on the south coast of England. A few telephone calls later and I was having regular friendly telephone conversations most evenings with a friendly chap.
Now it is worth me mentioning here that the IT industry, the business sector I am used to dealing in, is a very much knowledge sharing industry. Technical people help out other technical people, even if they are competitors they will point each other in the right direction to solve a problem. It’s how I work naturally, and it is what I am used to doing in my working day. So in my several times a week chats I had with Mr. X I would share with him ideas on how to help improve his website, how to improve his search engine rankings, and how to improve his web conversion rates. He would tell me bits information here and there in return, which at the time I knew wasn’t much but I didn’t think anything of it. Here was a friendly guy, I’d made a friend in this new industry.
Another friend of mine who I’d known for a few years, Tony Byng, was running a company formation website on the back of my software. Mainly because he had written most of it too, and he had a website called Direct Formations as a play on his then company name, DBF Systems so he called his setup Direct Business Formations. My new friend, Mr X, started asking me quite innocent questions about my software which foolishly led onto me mentioning Tony’s website. This was towards September 2004, so my new friend had been having chats with me on the phone several times a week for about 6 months by this time. he was playing the long game, but little did I know what he had in store.
At the end of 2004 I was very active in the online community and was becoming a bit of a networkoholic online (still not going to any face-to-face networking events), and I was become exceptionally active on UK Business Forums which had been set-up by a web design company, as well as Ecademy another online networking website that had recently started. Business was doing really well, but I did have one small problem. I wasn’t making much money, although I was spending not much short of £100,000 on marketing activities with the majority of this being Pay-Per-Click. I do did get some nice Christmas presents from Google though, a lovely weird lamp and a clock if I remember correctly. This will become apparent why this was a very big problem in a moment.
My wife and I decided we needed to move house because it was becoming extremely awkward with my still working in the kitchen, and we were aware that we needed to consider taking on a member of staff to handle the dispatching of client orders. The two of us working to the early hours each morning printing and packaging documents, we decided to sacrifice some of our income to pay someone to do that for us. We wanted our evenings together back again. With this in mind, we started looking at moving from Luton to Northampton, with the plan to take on an office. In reality we purchased an “Executive” home which has already had one of the garages converted into a home office, which was ideal because I didn’t want to give up being at home with my daughter… and we had another baby on the way. We moved in to our new home in October 2004.
Two months later Mr X sued me for passing off, a week after I got the letter from his solicitors I got a letter from another firm of solicitors suing me for infringement of Trademark. I very quickly learnt from someone else in the industry, as by now I’d got to know a few others, that these two were in each others pockets. I appointed a solicitor and the legals started, with a very long drawn out process of getting to caught. My wife was heavily pregnant and was having panic attacks, distressed that we had just moved taking on a much higher mortgage and these people were attacking us. The legal fee’s were costing a fortune, but it was going on and needed to be dealt with.
At the same time the other form started suing my friend for Passing Off, and I will say now that Tony is the kind of guy who wouldn’t say boo to a goose. Not the healthiest of chaps with a number of health problems since childhood, but it came to light that used in evidence was snippets of conversations I had been having with Mr X. as he had been using me. I wondered why he’d stopped taking my calls towards the end of 2004. This other firm almost sunk Tony’s business, forcing a guy who’s been self employed working from home since 1994 to change his company name he’d been using since 1994. Purely because he didn’t have the finances to fight it.
I’ll summarise this whole experience with how it closed. Mr X was paid a couple of grand to go away because at the time I had been bidding on Adwords which contained his company name (which is common practice in all industry sectors and competitors are bidding on my company name on Adwords as I type this now), but for the sake of my wife I paid. I couldn’t sit and watch her suffering the stress and anxiety she was going through. Once that had been paid the other firm sent a proposal to my solicitor, agreeing to “settle out of court for £50”. Yes, that is not a typo, that was fifty pounds after costing me thousands of pounds of legal fees. My solicitor said at the time they’re just trying to hurt your business or ideally put you under.
That was the only time in the history of Quick Formations that I almost shut up shop. I was going to post the source code of the software I’d developed up online for everyone to access, and just call it a day. It hurt me to see what my wife went through during those months and I really wondered whether it was worth it, but my wife bless her was very determined not to let them when. She told me don’t you dare give in and insisted I continued to fight it, but as I say it came to a point where I wanted to get on with my life and move on.
The start of 2005 did bring with it a life changing event though, I purchased those Internet business forums I’d been taking part in called UK Business Forums. Gary, the guy who started them, decided that I was doing more to grow the forums than he was able to so asked me if I wanted to take them over. I couldn’t put my finger on why at that time but I just had a hunch they could become something big, a community of small business owners interacting with each other online just seemed such a fantastic idea. This was also one of those business decisions that my wife did actually agree at the time as being a good idea.
I also started entering more business awards, paying that close attention to what I now knew the judges were looking for, and pulled a large part of my online marketing spend. I’d just had a huge financial hit on my business which left me with nothing and I needed to recover, with a baby on the way and a new higher mortgage. It was also at this time I started smoking for the first time in years, although thankfully I quickly stopped again as soon as my son was born.
We took on our first member of staff to handle the printing and dispatching of our clients orders so that my wife and I got our evenings back again, and not long after my wife’s parents followed us up to Northampton my mother-in-law started working for us a few hours a day.
Those couple of years taught me a few more lessons. The first lesson is one that is perhaps old hat now yet so many businesses still don’t embrace social media, although when I was doing this the term Social Media hadn’t been invented. As a small business the Internet creates a level playing field for everyone, and by utilising social media any small or large business can compete with each other equally. It was big when I was doing this and to see how the use of what I called “networking online” has grown has been phenomenal. The important things to remember though is the same rules of etiquette apply online, do it wrong and people will dislike you very quickly. I wrote a blog post years ago about this topic so if you would like to know more, Get the most out of using a forum and then another blog post much later about Social Media. The most important bit I would like anyone to take away from this is, Use social media especially if you are a small business trying to compete in a big market. However, use it correctly and it will help you grow your business for little or no financial cost. I always say Social Media is the biggest influence and vehicle I used to grow Quick Formations.
The last lesson I learnt in this chapter is one I have learnt but chosen to ignore, and that is don’t trust anyone. The reason for this is because despite a few people telling me to not trust anyone, assume everyone is out to get you, become a hardened git, I believe that is wrong. I am who I am, my friends like me for who I am, and my family stand by me for who I am. If I let everyone who tries to kick me down change the person I am then they have won, so instead my advice is don’t let any negative experiences of life change the person your loved ones love you for who you are.
The year 2005 held a few more events for me and I’ll come onto those in the next blog post, trying to keep these bits as short as I can really. I know for a blog post they’re technically longer than they should be, but heh you are free to choose to read or ignore :).