August 4, 2022
As part of our Entrepreneur Series, this month we had the pleasure of getting to know Jeremy Harford, Founder of MESTEC – a software company that drives and improves factory performance by focusing on business pressures. We chat to Jeremy about his background prior to MESTEC, the greatest technological advances in the software, his tips for business owners looking to sell and much more…
What is your background prior to founding MESTEC?
Until my early twenties, I was a professional full-time water skier and lived out in America while doing the pro-tour. After a couple of years, I returned to the UK to work as an Account Manager for the beer company Whitbread – I thought I’d work at selling a product that I believed in! After working in the Take Home Division for 2 years, I moved into the IT sector working for a company called Metrologie. About 2 years later, I started my first company Zygology Systems, a value-added distributor for several barcoding product vendors. Our sector was ‘box-build electronics’ focused. There was some crossover between Zygology Systems and founding MESTEC, and I eventually sold Zygology Systems by management buyout in 2008.
How has MESTEC evolved since you started the business?
We began by acquiring a company called Acquisition Solutions who had Thales Group as a customer – one of Europe’s largest aerospace and defence contractors. This acquisition was based off my hunch that manufacturing execution and the management of data in factories would eventually digitalise. I bought out the only serious competitor in the UK which not only eliminated the competition but allowed us to learn about the intricacies of ‘critical’ manufacturing and how technology could support manufacturing operations.
Over the years we continued to develop our software and rolled it out to other Thales business divisions and then to a broader sector base. We ended up with around 35 major clients as we diversified from aerospace & defence to other regulated sectors such as pharmaceuticals, medical devices, food and precision products both in the UK and overseas.
Since founding the business in 2000, what period would you say you saw the greatest technological advances in your Software and what drove this?
In 2015, we followed a common migration path that much of the software industry had already adopted (SaaS; Software as a Service) and launched our first cloud-only product. Prior to this, software was installed on-site on the customer’s own computer systems. This migration to the cloud really changed every aspect of our business – our financials, tech, marketing and how we sold the product and supported our clients. This migration to the cloud changed every corner of our business. This new subscription model also made our product easier to sell because customers wouldn’t have to justify large upfront costs.
Did the Coronavirus pandemic affect the business, and if so, what contingency plans were put in place to ensure survival?
The only way in which the pandemic affected us was attracting new businesses. We won minimal new deals during this period which were relatively small. At the same time, we didn’t lose any of our customers to the pandemic. The only contingency we put in-place was a Coronavirus Business Interruption Loan Scheme (CBILS), a government scheme designed to support the cash flows of businesses during the pandemic.
MESTEC has recently been acquired by Eyelit (a Banneker Partners company). How did you find the M&A process? What were the biggest challenges you faced during the process and how did you get past them?
I personally found the M&A process very easy – I thought it was going to be much harder than it was. One of the main reasons for this was probably because I had already resigned as CEO of the business and was only really involved in the high-level strategic decisions. Bluebox also guided the process very well and most challenges along the way were resolved by them. It was just a very seamless and stress-free deal. The fact that Banneker were the front-runners right from the very start also made the negotiations relatively easy.
What three tips do you have for business owners looking to sell their business?
Following the transaction, you have exited the business, what are you doing now and has your life changed since exiting?
It has been a big adjustment and one thing to consider is wealth management – how am I going to manage my money, how I will invest it and so on. I also have Croatian residency, so I am looking forward to spending more time out there. Post-sale can be quite a lonely and disorientating place so my advice to business owners is always think about why you want to sell the business, what your objectives are and what you are going to do post-sale.
What 2 personality traits do you believe make a good business leader?
What advice would you give to a young entrepreneur starting up their own business?
Business planning is key. Do your research, be very clear about your proposition and how you are going to be different from your competitors. You must have a very well-rehearsed and impressive elevator pitch because when you start, you are going to need that pitch every single day. Planning your finances well and building contingency is also crucial as unexpected costs often appear.
If you could have one super power, what would it be? Predict the future.
If you could start another business, what type of business would it be? Probably an EIS fund, funding businesses in my now ex-sector.
Go to holiday destination? Croatia, the best place in the world!
If you could only eat one dish for the rest of your life, what would it be? Croatian lobster.
“We were delighted with the services that Bluebox offered us. Bluebox’s attention to detail through their Diamond Programme ensured that we were well prepared for when the business was taken to market and that the sale process itself was managed expertly.
We challenged Bluebox with finding the right strategic buyer and thereafter negotiating a deal that met our requirements. In helping initially to identify and to secure the deal with Mountville Mills they accomplished just that. Communication throughout was excellent and professional, managing each stage of the process. I would have no hesitation in recommending Bluebox to any corporate shareholder or private business owner looking to divest their business.”
Richard Millward, Former Client
“We were delighted with the services that Bluebox offered us. Bluebox were challenged with finding us the right strategic investor and, thereafter, negotiating a deal that met our complex requirements. In identifying and securing the deal with LGC they have done exactly that. The process itself was efficient and smooth, largely due to the excellent communication from the Bluebox team, who also demonstrated excellent experience at managing a very engaging auction process. I would be delighted to recommend Bluebox to any corporate shareholder or private business owner looking to divest a business.”
Helen Dickinson, Former Client
It has been a real privilege working with the team at Bluebox over this last year or so. Bluebox’s attention to detail ensured that we were well prepared for when the business was taken to market and the sale process itself was managed expertly. Starting the process, I had no idea exactly what this would entail and the volume of work that has been produced by everyone and the result reached today is nothing short of brilliant.
Hugh Morris, Former Client
We are delighted with the services that Bluebox was able to offer. They showed an intimate knowledge of a deal cycle, managed a tight auction process and were highly communicative from the start. I would happily recommend Paul and his team to business owners contemplating a sale of their business in the next 24 months. Experience is key and this has paid off for us.
Laurence Seward, Former Client
Aligning ourselves early with Bluebox, and entrusting the team to guide us through their process proved to be a highly rewarding investment from all viewpoints. Bluebox’s support significantly enhanced both the value of our business and its ‘saleability’. I would highly recommend Bluebox to business owners contemplating an exit in the next two years. The earlier the engagement the better so far as I am concerned.
Mike Minett, Former Client
We began working with Bluebox in early 2015 through their Blue Diamond Programme, as we were contemplating an exit. We found that the process focussed our minds on the key areas of growth in the business, and prepared us well for the inevitable rigours of due diligence. During the sale process itself, the advice offered by the Bluebox team was invaluable. We found them to be helpful, straightforward and honest.
David Stokes, Former Client
When selecting our adviser, it was extremely important that they had access to international buyers and were experienced in cross-border M&A. The team at Bluebox proved to be invaluable by identifying a strategic acquirer from America who was not known to us and by negotiating an excellent deal for all parties. I was also impressed with the process management from Bluebox, which ensured that the deal was closed in a timely fashion.
Jeff Weinstein, Former Client
When I first engaged with Bluebox, I was hesitant as to the benefits of using an advisor to firstly, find a buyer for my business and secondly, to get a deal over the line. However, now that the deal has completed with KPM, I can honestly say that the finer negotiation points handled by Bluebox and their overall management of this process has been nothing short of first class. I would be delighted to recommend Bluebox’s services to any entrepreneur contemplating the sale of their business.
Bill Ballard, Former Client
Bluebox worked closely with us over the following six months and helped us to implement some key initiatives which made InferMed a more attractive acquisition target. Once we decided to sell the business, the Bluebox team were very diligent in ensuring that no stone was left unturned. They negotiated expertly on our behalf to ensure we got the best deal possible.
Alan Montgomery, Former Client
The pre-sale planning programme that we signed up for with Bluebox made us develop our strategies and focus on the bigger picture. It proved to be a very rewarding investment from all viewpoints and significantly enhanced both the value of our business and its ‘saleability’. I would highly recommend Bluebox to business owners contemplating an exit in the next two years.
Nigel Parsons, Former Client
I have experienced first hand the value that can be created through highly structured pre-sale planning. It amazes me that it is not something that everyone does. It is so disappointing to see around 90% of transactions collapse before they complete and pre-sale planning will not only enhance your price, but also significantly enhance your chance of a closed deal.
James Caan, Investor
We worked incredibly closely with our advisers who provided expert knowledge of the sale process with which we were not familiar. We were truly delighted with the results.
Marten Nielson, Former Client
We appointed advisers to manage the sales process after we had received a number of unsolicited approaches for the business. I was incredibly impressed by the immense value that could be created by expertly negotiating with a group of already interested parties.
Paul Duckworth, Former Client
I was delighted with the service that the team offered and their real attention to detail. The deal was not without its complexities and it was reassuring to have such experienced advisers assisting me throughout the negotiations.
Peter Bennett, Former Client
Truly delighted with the way my sale process was managed. The fact that the team I worked with achieved such a great multiple is testament to their experience and their ability to create some true competitive tension.
James Averdieck, Gü, Former Client
The team at Bluebox provided invaluable support in negotiating this complex transaction. Their access to international purchasers, and exceptional knowledge of cross border M&A ensured that the deal was concluded efficiently, achieving a highly successful outcome for us all.
Jon Parslow, Former Client
“We selected Bluebox after a fairly long round of evaluating potential advisors because of their scientific, yet challenging approach to maximising value. During our initial meetings they showed us how far short of “ready” we were and consequently we completed more preparation in the early stages which meant we were equipped for what was to come. We were delighted with our choice of Corporate Finance partner. I do not hesitate in recommending Bluebox for any SME to consider.”
Simon English, Former Client
Bluebox provided invaluable advice in managing the negotiations with incoming investors. Their skills in handling these discussions were evident from the outset and the vital interface that they provided between the incumbent team and the incoming investors was truly beneficial.
Henry Braham, Former Client
Bluebox have a professional, dynamic and experienced team that is greatly assisting me with my focus on my exit within the next 24 months. Their structured approach is very refreshing and their ‘Blue Diamond’ programme is adding immense value.
Matt Evans, Former Client
The team at Bluebox provided me with a seamless service from the start of the engagement until our deal was completed. Attention to detail was commendable and their understanding of corporate M&A very impressive. I could not recommend them highly enough.
Victor Lewis, Former client
Having tried to sell my business previously – and failed – I was only too aware of the importance of pre-sale planning. This is a talented team offering a service that most people find out about, but too late.
Simon Hulme, Former Client
Bluebox are a quality outfit. Their access to International acquirers and relationships with the highest quality domestic investors was impressive. My shareholders and I received excellent service from start to finish and it was refreshing to be dealing with a senior team throughout the sale exercise.
Michael Clapper, Former Client
I cannot recommend the team at Bluebox highly enough. Their expert guidance throughout the entire sale exercise resulted in my shareholders securing an excellent deal with which the entire team was delighted.
Mark Rodol, Former Client
I’m really pleased with the service Bluebox provided. The team demonstrated excellent knowledge of the process to follow and led negotiations for the hospital in a way that allowed us to ensure we received appropriate value whilst focusing on reputational risk. Communication and service were of a very high standard.
Steven Davies, Former Client
With Bluebox’s expert advice we were able to find the right buyer that will benefit our business strategically. We’re delighted with the outcome and look forward to starting our new chapter
Clive Hillier, Former Client
The advice offered by the Bluebox team throughout the process was invaluable to the shareholders. We strongly believe that participating in Bluebox’s pre-sale planning programme was a significant driver behind the success of the deal. Their project management and negotiation skills throughout the sale process itself resulted in an exceptional deal being delivered to all parties involved.
Harpal Singh, Former Client