Planning, people and performance: The key to moving from startup to scaleup...interview with Brian Donne, Express Vending

Planning, people and performance: The key to moving from startup to scaleup...interview with Brian Donne, Express Vending

| 2019-06-25 17:34:00

Planning, people and performance - The key to moving from startup to scaleup...interview with Brian Donne, Express Vending

Scaling up a business from absolutely nothing isn’t easy - but it can be done. 

Brian Donne is the living proof. He built Express Vending from a kitchen table, a few contacts and no money, and sold it thirty-odd years later when the business was doing £40 million in revenue. In short, he went from start-up to scale-up. Here’s how...

Vistage: You ended up selling Express Vending for £40 million. Was that the plan from the start?

Brian Donne: I had a company before Express that went bust - a similar business, in vending machines. I closed that on a Friday night. On Monday morning the harsh realisation hit - I had three children under three, a mortgage to pay, and a company that had gone down the toilet. I knew I had to get moving again quickly. So I started again, from a kitchen table. That’s why it was named Express Vending - it had to be done quickly, out of necessity. There was no thought of growing a massive company at that point, we needed to eat.

Vistage: What did you do differently, the second time around?

BD: This time I surrounded myself with what I called the bodyguards - people to keep me on the straight and narrow. And listen to their advice more clearly. The people I got on board were older and wiser than me and could reduce my original mistakes. One thing for sure, I didn’t want to borrow any money to set up - no overdrafts or loans, anything like that. 

To do that I had to find the right bodyguards, with the right motivations. I needed their labour and their years of experience. I had nothing to offer at this point other than a promise or a vision. I couldn’t pay them, but I could swap equity for advice.

I paid them back in three months - but they kept the shares, and I kept them, and they’ve been rewarded very healthily, twenty-five years later.

Vistage: So you got the right people on board from the start, what were the stages after that? How did Express Vending grow from small beginnings?

BD: Once we had money, we had to go and sell things and get contracts.

For the first seven or eight years, we were just sales and finance, subcontracting everything else. I set up the contracts and would give them to people who were service providers. We’d invoice on a higher margin. Everybody was happy. 

That grew us to £1 million in eighteen months, and every year after that we added another £1 million. The next five years was consolidating my business, learning what I needed to learn. When we got to £6 million, certain things happened…

Vistage: Such as?

BD: One of my subcontractors retired and wanted to sell up. It was a bit of an “oh shit!” moment. They’re filling and cleaning and managing a third of my customers. They could sell to a competitor. What am I going to do?”. After thinking carefully and talking to advisors the best strategy was to acquire and integrate them into Express Vending. That gave me a security of service and consistency to my customers moving forward. and I thought.

So I bought them. Now, I left school at fifteen: I didn’t know what a graduate was, but I was recruiting them, and I’d realised I wasn’t sure what I was entering into. I was looking after four kids by this point, running the business, and doing two nights and one day a week at uni, learning what not to do. 

During the next five or ten years the other subcontractors all retired and we bought them all out too. 

By then the business was at £10 million, and I was thinking: “that’s a lot of money, a lot of staff, we’ve just bought new premises, where does it all end?”  I’d grown the business to £10 million on sales alone, but I needed more knowledge after that. So I enrolled myself into an MBA. Looking back, I realise I didn’t understand what I was doing at all until I took that first course.

The MBA taught me how to write a roadmap. I needed to put a plan together of what I was going to do, how big I was going to grow, how much it was going to be worth and when I was going to get out, and I needed all that on paper.

I discussed the future with the leadership team - what were our goals. One of the sales directors said he wanted to earn a million pounds. I had my own personal goals. After eighteen months we broke down the whole business and came out with a plan that suited everyone Our roadmap said we could break £25 million by the end of 2011, £30 million by 2015, £40 million by 2018.

The other realisation was that I needed to upskill and continue to grow as a leader to grow the business. In 2008 I enrolled with Harvard Business School and continued doing yearly courses for the next decade. 

Vistage: So this growth plan took you from £10 million in 2010 to £40 million in 2018? What did that look like?

BD: After the MBA and during my courses at Harvard I created a business management team, with a bonus scheme built around the plan to take the business from £10m in 2010 to £40m in 2018. I was fortunately successful.

We cleaned up the entire industry - we became one of the fastest growing companies in the UK, beating out some big name competition. Just before I left, we got a letter from the Stock Exchange - unsolicited - saying thank you very much, we were one of the top 1000 companies in the country. 

Just before I left, we got a letter from the Stock Exchange - unsolicited - saying thank you very much, we were one of the top 1000 companies in the country.

All this was a result of a process. It wasn’t luck, or timing. To grow 20% every year in a declining market isn’t anything to do with timing. It’s about the plan and the people. It was me doing the MBA in 1999, going to Harvard from 2008 and doing a course every year. It was taking some of the leadership team to Harvard to support them with the learning development along the way. And now I coach at Harvard Business School part-time, teaching some of the people I used to be.

Vistage: Was being a coach part of the plan?

BD: That’s the only thing that’s come as a huge surprise to me. Everything else has come out of thinking ahead. I knew where I was on day one and where I wanted to be. If my vision is “to have complete freedom in work and life”, I have to find out how to get there from where I am, write it down and figure it out. You don’t go on a journey without knowing where you’re going, putting the petrol in the tank, packing all the bits and pieces - you need to be tooled up to get to where you want to go. 

Vistage: The courses you took clearly inspired a shift from steady growth to rapid scale. Were there any other driving factors?

BD: What it comes down to is that I’d lost a business. I had four children at home, and I had a responsibility, and I screwed up. So I had to make good on that. Then, when I was employing thirty people, I was looking after thirty families. And when I was employing a hundred people, it was a hundred families. They look to me for guidance and inspiration and direction. My role is, or was, to give that. 

The philosophy was that people had to develop. If you don't develop great people they leave. And great people want to push themselves, and the business, forward. I had to grow the business to keep the people. 

Vistage: How did your role as the business leader change as the business grew?

Brian: In the first five to ten years I was mostly selling, and gradually taking on more managerial work as we took in the servicing vending machines from the subcontractors. In 2010, my operations director left, and I took over his job and promoted a sales director to do what I’d been doing. And because I’d moved out of my ivory tower and come onto the shop floor, I saw I could transform the business from a good one to a great one.

Vistage: That sounds like a lot to take on - leadership and operations. Is the advice more like “understand exactly what happens on the shop floor”, rather than “take on two jobs”?

Brian: Let’s be clear. I didn’t have a big vision at the start. I didn’t think I could do the job at all! But if you have children, and you have one who’s OK and the other one needs your support, you have to go and help the one who’s not OK. It’s the same with a business.

I went out and got myself trained to do this. I did the MBA, I did the courses, I did the Business Owners’ Degree. I took courses in customer service and customer excellence, just to find out what great looks like. I think you have to understand this before you can recruit the right people. You always want to hire people better than you - finding your weaknesses and filling the gaps - but unless you know what great looks like in those areas, you won’t get the best people.

I’ve spent a lot of time around better people than me and I’ve learned you have to put yourself among the right people and the right people around yourself. 

I went and interviewed everyone who knew more than I did about the work we did. I would go out with people, filling and fixing and installing machines. I went out with operations people to see what it was like and if the stories I was being told were true. After six months I finally knew what the job was about. 

In football, you can’t be goalkeeper if you’re a striker. You’ll get found out and you’ll screw up. So if you’re a sales guy and you want to move into operations, don’t just do it. Go out there and learn how it’s done. By the time I sold up there wasn’t an area of the business I didn’t know - selling, managing, finance, operations, service, I’d learned it all by going out there and doing it.

Vistage: Did you sacrifice anything to get there?

Brian: I didn’t sacrifice anything, because I had a plan. I always had eight weeks off a year, and I doubled it by the end. I was able to do that because I put the best people in the best spots. I put the goalkeeper in goal and a good fullback ahead of them, so if I was away, I had the best people covering me in every position. Essentially, the business wouldn’t suffer without me?

For me, work-life balance is about getting the best people to cover my weaknesses and give me time with my family. I could pick the kids up from school and be home with them every night. That responsibility was always part of the plan. Fundamentally, my business was built around my requirements and the customers’ requirements - and in a way an entrepreneur is the ultimate customer.

Vistage: An entrepreneur is the ultimate customer?

Brian: When you’re an entrepreneur, all your decisions are made at the beginning, but they’re based on the life you want to have at the end. You’re starting the business so you can have freedom, so you can’t be fired, you can achieve what you want to achieve. Every decision you make is based upon your future. You reverse-engineer everything from the life you want to lead. 

I worked out where I wanted to live, how I wanted to educate my kids, how much time I wanted off work, and that meant I knew how much I had to earn, and when and how it would be the right time to sell and stop.

Plans won’t turn out exactly as expected. But you have to be flexible enough in your mind to alter as you go along, and not compromise the values or overarching goals. 

Vistage: Has it been a challenge to adjust from being a business leader to… well, not being one?

Brian: It was always the plan, but it’s difficult to adjust to.

I talked about having time off, but when you’re running a business and you’re responsible for hundreds of people, in a way you’re at work all the time. After thirty-five years of that constant responsibility - emails and reports and calls and company cars and your picture on the wall - when that’s all gone, you do go from hero to zero almost overnight.

The night of the sale, I went camping with the kids and my brother, to get away from the hubbub, and that helped. It showed that nothing really changes as much as it’s changed. I wasn’t going to buy a fast, fancy car or a flights around the world. but the first four months were really difficult. I still miss the banter and the friendship and the numbers of it all. But I said “by Christmas, I’m going to be straightened out mentally, and I’m going to have a plan again.”

Vistage: Do you have a plan again?

Brian: There is a plan, and I’m ahead of the plan. I’m doing consulting, advising and investing, and I coach at Harvard from time-to-time, as and when they need me, and I’m doing property investments. Will I go back and buy a business? That changes every day. 

But I worked out that if I wanted to do something with two or three days a week, including prep time, and I wanted to work thirty-five weeks a year - it came out at a hundred plus days. So I want to work with one or two great companies who have plans to grow, have fun and need good advice and money if required. And I can guarantee success.

I help people who’ve got no support system, who are in the state I was in at the start. They need help and it stops me driving my wife mad.

Vistage: Is there a last word you want to leave us with?

Brian: Just this. Hope is not a strategy. If you think it is, you’ll fail. Strategy is about planning, people and performance. You make your plan, you trust your people, and when it performs right, when it hits that KPIs you’ve set, you’re done.

 

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