Our next Ambition Nation: Female Leaders Series event will be held 17th September 2019 in Central London – reserve your place in London here – and 18th September in Leeds – reserve your place in Leeds here. The series has grown in popularity as we convene more and more female leaders in the hope to inspire and connect an entrepreneurial generation-in-waiting, that can unlock significant growth potential in ‘UK PLC’. The next event is called ‘The CEO: On a role’, which looks at the changing role of the CEO through the life of a company.
Our September event follows on neatly from our previous instalment ‘On Track’, during which female CEOs from differing industires told us how they kept their companies on track and growing steadily, through good times and challenging. We take a look at what we found out below.
As an entrepreneur, how do you know when you’re on track? How do you know if you’re doing the right thing to drive growth or increase your investibility? And as a female entrepreneur, how much does that feeling accentuate?
Findings from the Financial Times and research by our own Finance Sector analyst reveals that female clients for financial services make up less than 30%, while female advisers are few in number and female investment managers are a very rare breed.
Being a female CEO can be a good PR angle, Debbie Bestwick, CEO of video gaming label Team17 told our last finnCap Ambition Nation: Female Leaders Series event. it’s undeniably unfortunate, in 2019, that we still need to speak in these terms, nevertheless when you have a point of difference in today’s competitive entrepreneurial world, you need to use it, explained Debbie.
With the investment side very much geared towards men – indeed our Financial Sector analyst observes that the generation that wealth managers currently deal with, where the average client ages are usually over 60, are likely to be households where the man is still seen as the person responsible for finances. This is likely to change over time of course, but such trends take time to bed in. Nevertheless it isn’t difficult to see how women operating in male-majority industries face a wall of low confidence, as Debbie Bestwick pointed out (despite women making up 50% of video gamers). She asked the pertinent question “How do we manage to be business women and mothers and it not have a negative effect on the business, or on being female?”
1. You don’t try to be everything to everyone
At the start of your business life, you get a gauge on your investibility; friends and family can provide a good litmus test as to whether your business is worth investing in, said Kim Morrish, owner and director of Ground Control. But with all that initial momentum it’s easy to forget that you can’t be everything to everyone. Debbie Bestwick, founder of Team17, explained that during the course of your business life you have to accept some people will be keen to invest and some will not. What that also means is that you develop a nous not only for how to approach potential investors, but who to approach.
2. You’ve built culture from the inside up
“Culture eats strategy for breakfast,” said Brenda Trenowden CBE, Global Chair of the 30% Club, herself quoting the great Peter Drucker.
In order to innovate, in other words to think differently, one must build a culture of thinking differently. Brenda stressed the importance to see gender balance in business leadership as a better business proposition – providing means to be a more innovative company – and not a social movement. She cited studies that demonstrated that the most innovative companies are the most diverse, and the more diverse the company, the more innovative its attitude.
And culture transcends more than just innovation, put simply it’s the way things get done. Debbie Bestwick explained that keeping the human side of business front and centre of your cultural mindset is what keeps you on the right track.
Debbie said: “Not only are we selling millions of games, we are changing the creators’ lives. How do I keep it fun, non-static and driven? I keep a list of the personal reasons of why we do what we do, not just the business reasons. Passion – when it’s falling apart or going wrong – is what keeps you going.”
3. You’re not micromanaging
Henrietta Morrison built the Lily’s Kitchen pet food brand from a simple passion to create better nutrition for her beloved dog. She explained how that drive and focus helped push a good idea to global status, and relatively quickly at that. She explained how making mistakes was part of the process and one shouldn’t be afraid to try new things.
Indeed, seeing how not to do something can be just valuable as learning how to do it. Case in point – Henrietta explained that as a founder building a team, there is a natural tendency to want to micromanage. She quickly discovered that her efforts should be directed elsewhere, given that Henrietta had recruited her team smartly.
“I learnt very early on that trying to be one of those people that looks over people’s shoulders is a waste of time,” said Henrietta.
Employee engagement and loyalty are the reward for this mindset, and these are everything to growth and to maintaining your core values from the ground up.
Longevity of service is a key indicator of employee engagement, and therefore a flourishing company, and in the context of identifying a company to acquire or in preparing yourself as an M&A target, experienced acquirer Kim Morrish said that staff turnover is major point when you’re looking to acquire. As such, from recruitment to appraisals to regular team events, use every opportunity to continually reinforce the values, culture and your working environment at every touch point.
4. You innovate every day, in every way
Keeping one’s business on track is not just a case of having big ideas and knowing what the next level of financing you need. Driving growth comes from the minutiae of your daily operations – doing that little something every day that drives progress and helps growth in incremental parts.
To put that into context, Kim Morrish’s expertise in acquiring companies provided a salient analogy. Doing something every day that drives growth is a question of fine tuning; that goes just as much for when you’re considering a company to acquire.
The acquisition process, Kim explained, starts with asking yourself “what’s missing?” – a question which goes for staying on track, whatever the point in your business journey. What’s preventing you from growing right now? There’s a gap that must be filled to ensure progression – perhaps a skill-set, a specialism, a key qualification, or you need a new talent – what can you acquire that achieves that end? Remember that acquisition doesn’t have to be whole new company, or even a whole new person.
5. You’re afraid of neither debt, nor of relinquishing ownership
Debt can be a scary word, conjuring mental imagery of being in someone’s pocket. But the fact is simply that it is another good option for growth. We recently produced a guide https://www.finncap.com/news-events/raising-money-guide-debt-vs-equity which sets out that debt and equity are two sides of the same coin. They are a means to an end; the route you choose depends on your business’s needs at the time – indeed you might opt for mezzanine financing, a combination of the two – balanced against how much ownership you or may not be willing to part with. But debt is a very normal route to growth capital and as ……. Said: “Just remember, you can still be successful without losing ownership.”
6. You listen to your mentors and advisors
Holding events like the Female Leaders Series brings home the notion that mentorship is hugely important in business, and it is unfortunately a resource that men can more easily tap than women.
Only 28% of women in the workplace say they have ever had a mentor now or in the past compared to a third of men. Men also report having had more mentors than women – 3.7 on average compared to 2.5 for women.
Henrietta Morrison explained that Lily’s Kitchen’s private equity firm were very helpful in informing them about how and when to scale up the business. Meanwhile, Debbie Bestwick, who described herself as not the typical CEO, said: “Find an advisor who understands you and supports your differences, who builds your confidence and gives you reassurance.”
7. You see opportunity in the challenges
The world of rapid-growth business is governed these days by the ideals of disruption and innovation. To disrupt an industry involves the likely upset of a balance held by a couple of incumbent big players. But this can present the opportunity as much as the challenge.
The fact that the pet food industry is dominated by multinationals was part of the impetus for Henrietta Morisson to launch Lily’s Kitchen. Henrietta saw that there must be room for a challenger, saying: “Part of my passion was not just in the food itself, but also to break the grip. When I put two and two together I realised that what I was feeding my dog at the time contributed to making her ill. I was incensed and I thought there must be other people out there like me out there.”
8. Start small and pick your markets
Indeed, the only way you should be micromanaging (in a loose sense of the term) is in your testing of different and new markets. Start small. Pick your markets and do your research, as Henrietta Morrison advised: “Don’t get distracted by international markets until you have a very solid base in the UK.”
9. You can cut through the jargon
Demystifying the financial language is a major barrier to growth. finnCap CEO Sam Smith pointed out that her education as an accountant gave her the benefit of being completely financially literate. Many female entrepreneurs do not have this benefit. We need more effort to demystify finance and place more emphasis on the variety of funding options that are available to entrepreneurs.
Kim Morrish, Director of Ground Control and Debbie Bestwick, founder of Team 17 both spoke of their experiences finding funding for and growing their businesses. For Kim, the growth of her commercial landscaping business, Ground Control, came through acquisition funded through earnings and taking on additional bank debt, whileDebbie decided an IPO would be the best option to grow Team 17. Her experience was the IPO process was far less complex and daunting than she had expected. She advised solid research and seeking the advice of those that had already been through the IPO process were crucial to her success. Such an exchange of knowledge is key to demystifying the funding process and helping future business owners understand the options available to them.
10. You are not afraid to take a risk
Risk-taking is central to successful entrepreneurship, critical to the innovative mindset. Basically you’re not afraid to try new things. When I moved from heading a company division to founding and becoming the chief executive of a business I appreciated the risks I was taking and the different order of commitment and responsibly this would involve. But I also believed in my vision and had a passion to carry it through. Some women find risk taking particularly challenging due to a number of factors. Some of this is societal, young girls are less encouraged to take risks from an early age, unlike their male counterparts. Becoming comfortable with risk taking is never an easy thing to do but to some extent it is fundamental to the success of any founder, female or otherwise.
At our Ambition Nation Female Leaders’ Series event Debbie Bestwick also spoke of the importance of taking a calculated risk approach to growth funding. After all taking a company public involves a number of complex variables not least of which is accepting you will lose a certain amount of control over the business you have created. You also have to persuade new investors of your vision for the business in order to retain enough control to take the business forward, while also delivering on promised returns.
So that’s how you keep the business on track. Our next event focuses on keeping you, the CEO, on track as we explore how the role tends to evolve.