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Home  →  News   →   HOW SIMON CASHMORE ABSORBED THE SUCKER PUNCHES TO KEEP ON GROWING TCL GROUP

HOW SIMON CASHMORE ABSORBED THE SUCKER PUNCHES TO KEEP ON GROWING TCL GROUP

Oct 11, 2019

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CLIENT SHOUT OUT

Peter Sterling | Relationship Partner, Cooper Parry

“I first met Simon back in 2006, when he was looking at the possibility of buying a relatively small but very successful commercial landscaping business based in Northamptonshire. I saw straight away that the entrepreneurial spirit lay deep within his DNA, and this was confirmed when he was named EY Young Entrepreneur of the Year in the Private Equity sector in 2015.

I wasn’t the only one impressed, either, because although that initial 2006 deal never completed, Simon had gained the backing of Caledonia Investment Trust PLC, a quoted company. They supported him with his acquisition of TC Landscapes and we worked with Simon and Caledonia in carrying out a review of the target and the formulation of forecasts and a business plan for the new entity.

I’m sure Simon’s team will tell you that he is a demanding leader with great attention to detail and a passion for driving change. That’s why, even in the worrying time of 2008 when the financial crash brought the housing market to a grinding halt, Simon and his management team never lost belief in the business. They knew they had to ride out the storm. The business came back strongly and Simon led a number of carefully research acquisitions to broaden not only the geographical spread of the company but the ranges of services it offered. Everything from children’s playground installations, to grit spreading in the winter months, to new build house cleaning, to the management of outdoor spaces for local authorities and commercial landlords.

Turnover grew to £75m in the process, and it says a lot for Simon that in many cases the vendors of the businesses acquired remained with the group post-acquisition and enjoyed working alongside the new owners.

In later years, Business Growth Fund replaced Caledonia as the group’s principle institutional funder and they provided the financial backing for the expansion plans of Simon and his management team. We’ve been fortunate enough to witness first hand the growth and success of the business, culminating in its sale to Ida Verde Group, a pan-European group with a turnover of 700m euros, at the end of 2019.

We’ve always loved working with Simon and his long time business colleague Simon Abley, the ‘Two Simons’. They’ve always been ‘up to something’ and have shown great loyalty to us as well as the rest of their professional advisor team, most of whom have been with them from day one. They have been all-round ‘good guys’ to work with!”

THE STORY

Simon Cashmore feels slightly fraudulent when people call him an entrepreneur. How could he be a true entrepreneur (he was the EY Midlands Entrepreneur of the Year, 2015), he reasons, when he didn’t have to set up his company from scratch whilst sitting at his kitchen table in abject poverty, surviving on cold baked beans from a can?

The reality, we suggest, is that Simon is just as entrepreneurial as anyone we’ve ever met – and as humble as they come. His story may not follow the traditional founder’s tale, but his route to becoming a Times Business Hero and an EY Midlands Entrepreneur Of The Year award winner is a fascinating journey – a journey born of putting business theory into practice, and a large dose of guts and redoubtable resilience for good measure.

If you’re only interested in sexy sectors like tech, media or fashion, look elsewhere, for Simon is CEO of TCL Group, a landscape services company. In just 10 years he has built it up from a £5.5 million turnover business into a £60 million powerhouse, which employs 800 people.

It started with a hunger

His path is unusual. After a first job with Bass he joined the RAC, where he stayed for 10 years; the last four as MD of the business services division, managing around 700 people. Towards the end of his time there, aged 36, he started to yearn for a more entrepreneurial life and he began to research a wide variety of businesses with a view to securing private investment which would enable him to buy a company and use his service sector knowledge to dramatically increase its profitability.

Simon says: “I reckoned my plan might be interesting to private equity. So every Saturday morning I sat in my spare bedroom searching for brands, trying to find an angle around which I could build a strong business case.”

Eventually, Simon landed on an outdoor clothing company called Karrimor and he painstakingly built up a story to interest potential investors. He arranged meetings with private equity houses and pitched. The reaction he got still gives Simon the heebie-jeebies.

“I was incredibly naïve”

“The investors told me they liked my work, that I’d done a good job in thinking about the angles, that I’d built a strong business case, and that they really liked me and my RAC background. Then came the sucker punch! They asked where I was with Karrimor and I said, er, um, well… I haven’t actually spoken to them yet!”

That experience might have been awkward at first, but in fact it ultimately turned out to be the gateway to Simon’s future success. It also reveals his tough entrepreneurial assets: guts, resilience and independence of thought. What he had done was to display the courage to step out of his comfort zone, show off some brilliant business thinking and introduce himself to some extremely useful new contacts. “It was a ridiculous scenario and it still makes me cringe telling you the story,” he says, “but the bottom line is that I met a handful of people along the way who eventually became warm contacts, who agreed to support me if I came back with a new idea.”

Having learned lots from his first pitch, Simon did further research and, now backed by private equity, he tried to buy a number of businesses. But none worked out. His relationships with private investors continued to flourish however, particularly with a company called Caledonia Investments, and an undeterred Simon started writing to local accountancy firms looking for a retirement-sale business. He was still working for the RAC but his plan was clear: “I was a services guy, that’s what I had learned at the RAC – so I felt I could bring value to a small services organisation that operated in a sector not blessed with great quality service delivery. Any sector would do – it didn’t matter. I just wanted to find a service business I could improve.”

That’s when he found TCL

A company called TC Landscapes soon came to his attention. It was a garden-landscaping business which served major house-builders around Kettering, Northampton, Milton Keynes and Bedford, turning over around £5.5m. It was perfect for Simon’s “buy, improve and build” strategy.

At this point in our conversation, Simon wanted to put to bed what he regards as a myth: that private investors enjoy eating starry-eyed entrepreneurs for breakfast, spitting them out and then lunching on their remains. “My experience of investors has been wholly positive,” he says, “but then again we’ve always performed for them and been totally transparent.”

Step forward Caledonia Investments

Who in 2007 chose to back Simon in his purchase of TC Landscapes: “I felt blessed that Caledonia wanted to support and invest in me; it was the difference between getting the deal done and not. I was unproven at the time with no experience in the sector. And for that, I will always be grateful.”

Celebrations were not to last long however, because 2008 was rushing towards the newly named TCL Group like a speeding lawnmower. “We traded well from February to October 2007,” says Simon. “Then our turnover dropped 40% overnight. We had debt to service, a customer base I didn’t really understand and a business I was still getting my head around. It was intimidating. There is no greater stress in my experience than sitting down on a Monday morning to work out if you can meet the payroll for the following Friday.”

Sidestepping the credit crunch

Simon weathered the storm by thinking laterally, sidestepping the house-building downturn by installing children’s play areas. “It kept enough coming in to stave off redundancies and bought us time to change our strategic plan,” he recalls. “The credit crunch taught us that having a business heavily aligned to the house-build sector wasn’t sensible. So we set out to find a broader range of clients operating in different markets. We rapidly diversified by buying other complementary services, including a playground installation business and a facilities and estates management company. We became good at buying businesses and dramatically improving their profitability.”

There’s no hidden secret behind this extraordinary success

Just perfectly applied entrepreneurial common sense. “We hit on our own little model,” explains Simon. “We found businesses we thought were doing a genuinely good job for their customers. We then spent a lot of time with the owners to make sure that we were buying businesses with similar values to us so they would integrate well. Then we cross-sold a broad range of services to these new customers. For example, after buying a small landscaping services company, we were able to offer its clientele new services in the form of landscape consultancy and design, playground installation and estate management.”

But then, another sucker punch

By 2012, TCL had grown into a £18m business and things were looking rosy. But then the second sucker punch arrived, four years after the brutal haymaker of the credit crunch. Caledonia Investments called Simon and, following a change of CEO, told him it was pursuing a new investment strategy and that TCL’s size meant it did not meet the threshold to be a major part of its plans. “It was a massive setback as we loved being part of Caledonia and felt we were progressing well together,” says Simon.

But as with the credit crunch, what at first appeared to be a disaster turned out to be an opportunity. “We needed to find a new investor to continue our ‘buy and build’ story,” says Simon. “And that’s when we met BGF Investments, who back then were a relatively small SME investor. Caledonia exited when BGF invested. It was difficult of course, but ultimately it worked out well.”

Since then, TCL Group has moved from ‘S’ to ‘M’ in the SME category bringing Simon both a Times Business Hero title and an EY Midlands Entrepreneur of the Year trophy in the process.

Why does Simon think TCL has been successful?

“The essence of the plan was always to provide brilliant customer service in a sector not famed for its customer experience. It still drives me insane when customers don’t think we’re exceptional. The question ‘how can we do a better job?’ drives our agenda day in, day out. We look to make incremental gains every day.”

Simon has achieved all of his aims and more thanks to his commercial nous and operational skill wrapped up in a humble, pragmatic approach. This, combined with a solid business plan and the flexibility and determination to overcome unpredictable challenges, has ensured dramatic growth for TCL Group. No wonder the investors warmed to him so quickly during that first pitch! However, there’s just one thing that Simon got totally wrong right from the beginning. Not a true entrepreneur? Pull the other one.

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