Piers Daniell, director of Fluidata, is shortlisted for our Young Entrepreneur of the Year Award
Remember what it was like to be in your early twenties? It’s that precarious age when people are trying to figure out the enormity of adult life – deliberating over job options, meandering around India trying to find themselves, or ploughing away at a job they hate while day-dreaming about how they’ll hit the big time.
In his early twenties, though, Piers Daniell was busy establishing an internet connectivity company, which he launched in 2004. Fluidata has since made the Deloitte Technology 50 UK and twice made the Tech Track 100. Both are indices of the fastest-growing tech companies in this country, but it also made our 2011 index of the fastest-growing private companies in London.
Now aged 31, Daniell now retains directorship of Fluidata, which provides high-speed, bespoke internet connection services to businesses. Clients include FTSE 100 companies and Cisco is among its partners. Turnover in the year to March exceeded £10m, with profits of over £1m, and next year Daniell is expecting a £14m turnover.
Not bad for someone who taught themselves about both IT and business. We thought so, anyway, which is why we shortlisted Daniell for our LondonlovesExcellence Young Entrepreneur of the Year Award.
Piers, tell us about how you started in business and why you decided to launch Fluidata.?
I started helping people with their computers when I was about 15. I set up a website and started finding clients. I used to go up to London every weekend from age 15 to 19, really, every weekend, just helping people. It was all referral basis, and I learned on the job – I didn’t really know what I was doing!
I did my invoices and tax returns, so I learned all that. It was really playing at business, it wasn’t a proper company or anything, though I ran proper accounts.
At 18 I finished A-levels – my parents wanted me to go to uni, but I didn’t. Instead, I joined a very successful and sales-orientated IT sales company called Softcat as an account manager. I spent two years selling there, then I sort of reached that glass ceiling where I couldn’t really see any progress.
I thought: “If I stay here too long I’m not going to be able to start up my own company, because I’ll be too far into mortgages and things.” So I left and started up my own company again – starting the same business back up again, as I’d left it dormant for two years.
How did that company evolve into the Fluidata of today?
At first I focused on small computer systems. I imported stuff from Germany and made these very small computers built to order, then shipped them off to specialist customers in the UK.
The problem with that was one month I’d sell something and make some money, the next I wouldn’t. I wanted to recruit someone, but I didn’t know how much business I’d have in the future. I realised I needed a recurring revenue model, and so it was either going to be mobile phones or this new-fangled internet thingy.
The internet thingy won, just because you could actually own your customer relationships.
Your growth since then has been pretty staggering. How have you managed that growth?
We’ve built the business organically – we haven’t done any acquisitions.
We have a big focus on sales. My background in Softcat taught me a lot about how to structure a sales team. We don’t do any marketing, so we only really spend money on PR.
We have very good account managers. We train people from graduates – we don’t really take many experienced people. We spend almost a year training our graduates before they become valuable.
The only thing we measure in the business is our recurring gross profit. So we don’t look at revenue, we don’t look at any profit that we make on a deal that is just one-off, we only measure recurring money that we make – a sort of opex model.
Why have you chosen to structure the business that way?
Because the recurring gross profits is obviously the interesting thing. Once you’ve won a deal and you’ve got that coming in every month – as long as we deliver the service that the customer expects – then the new business we’re bringing in will sit on top of that.
You set the foundations right, and it’s grown exponentially from having 20 customers to nearly a thousand, because we’re building on top of existing customers all the time.
It also allows you to be a bit more pragmatic with the business because we know how much money we’re making, in a very rough sense, on an hour-by-hour basis. That’s allowed us to be quite loose with our spending and investment in the business. That has really helped drive the growth.
We’ve just added salespeople [when we have money to invest], and we’ve built the rest of the business purely around the sales engine.
As your business is so centred around recurring business, how do you retain customers?
It’s not too hard in our industry because telecomms is notoriously bad for service and quality! The dedicated account manager helps a lot because people like to have one point of contact.
We also haven’t invested in any one technology, so we’ve sort of become a trusted advisor to our customers. A lot of our big customers are customers that we won a few years ago, just by fixing one or two problems for them. Then we’ve earned their trust and then they’ve allowed us to bid for the rest of their business.
It’s having a long-term view – we’ve never tried to close big business immediately, and we really try and work on that relationship with the customer.
You’ve got about 1,000 customers now – what’s the split among them in terms of size?
We’re moving more mid-market – about half are mid-market to enterprise [i.e. larger corporations], and then the other half are smaller. The smaller half are more partners than they are end-users.
How have you continued to develop yourself as a leader?
I don’t count myself as a leader. I’ve never really been a massive fan of hierarchies. I recruited a lot of the people at the beginning, in the mindset that they will be the managers in the future.
There are three active directors. We understand what’s happening and meet once a month to discuss any big issues or opportunities, but we don’t really get involved in the day-to-day anymore, because the managers are all empowered to do anything they need to do.
I’ve tried to not be too possessive of anything. I set the standard and that’s all I maintain, but I don’t have to be involved in helping to achieve that standard.
As a company, we look into future plans and opportunities, but a lot of that is driven by what our customers need and want, so our salespeople actually drive a lot of our innovation.
Is 4G going to affect your business?
4G will be interesting. I think it’s probably oversold a bit because it will take a few years for it to really establish- think about how long it took 3G to become useful. Until you have universal coverage, consistency and quality then people aren’t really going to trust it, and especially businesses won’t.
Thanks for your time Piers and good luck in the LondonlovesExcellence Awards.
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