Citation really provides outsourced services to small businesses, particularly around human capital management and risk management. So we look after companies’ employees and their risk areas, and their business processes, through our employment law, health and safety, and ISO certification products.
When I first joined Citation, it had been in business for around 17 or 18 years. It had previously been privately held — it was a good product in a good market, but it was a fairly unambitious, fairly steady business and probably wasn’t making the best of what it had. So we joined that business about three years ago and set about trying to change its culture, its ambitions, and its pace.
The very first thing we did post-investment was hold an extended board meeting. At that time we didn’t have a CEO, so the chairman and myself brought in three or four people from each department for an hour to an hour and a half — the first time we’d been able to speak to them — and asked them what they liked about the business, what they disliked, and what they’d like to do to improve it, so that could feed into our thinking going forward.
ECI share my vision — and certainly that of our management team — of trying to build long-term, sustainable growth. It’s an intellectual approach, a considered approach, to think about what the business was at the time, what we’d like it to be, and what the steps to get there are — knowing that it’s not an overnight job and there’s no quick fix. They understand and value the difference between the role of an investor and the role of an exec. So they don’t try to get involved or tell you how to do things, but they are interested in what’s happening and they take great care in what’s happening. For a chief executive, that’s a great combination.
The commercial team were invaluable in this investment, particularly in the early days. Myself and a number of the senior team were MBI candidates — we’d come from outside the industry, we had a number of years of experience, but hadn’t really had the benefit of close involvement with the business previously. What the commercial team were able to do was give us real insight into how the business works and how the industry works from their point of view. To have that helping hand, that experience and intellectual brain power to help us work through problems in the early days was really important in helping us step up quickly.
During our investment period the company made two acquisitions. We helped the business source both of those acquisitions, do the due diligence, and ultimately make the assessment on whether to buy them — and helped plan how they would be integrated into and operate alongside the business.
When we invested there were two products — when we sold there were three or four. There was no tech enablement when we invested, but on exit we had spent three and a half million pounds during the investment period developing a tech-enabled product that improved both the customer experience and the employee experience. It was a massive shift in how the business operated, but throughout that the customer continued to be happy with the service they were given.
The business has been growing really quite significantly over the last three years — from a base of around 5,000 clients when it was acquired to around 17,000 clients today. So we’ve had a CAGR of around 30% a year of organic growth over the last two or three years, which has been really significant — especially when set against the market and against the historical performance of the business. It’s put us in a position where we’re really a scale player, and we continue to grow very quickly.
I think Citation is an excellent example of how it feels to be in private equity. There are some great successes, but there were also some low moments — when sales were going backwards and things weren’t quite working out. So it is a little bit of a roller coaster, but you work together to come through that.
I think ECI’s style in the market is one that sits well with me. They understand that the path to success isn’t linear and that there’ll be wrinkles in the road. They don’t get enormously excited when things are going particularly well, but nor do they get particularly down when you have a bad period — and both of those things will happen. As a chief executive, that’s really important — that you’ve got somebody who doesn’t expect instant results or have their head in their hands when you have a bad month or a bad quarter.
I’ve had nothing but a very positive experience with ECI, and I think their approach — their very measured, intellectual approach — suits me and suits our business.
