James Kyle, regional director, Rathbones
Rathbones was founded in 1742 yet has been operating in Newcastle since 2013, specialising in wealth and investment management. James leads the Rathbones team in the North East.
Early engagement
We would encourage business owners to talk to us well in advance of an exit. We love to take our time to get to know individuals involved in business transactions. Our experience is that often business owners are incredibly well advised but have neglected to look at their personal circumstances. These are often what we would describe as the building blocks of wealth creation and inflation protection, things like ISAs and pensions are relatively small items that can be meaningful over time. We’re always surprised when we meet very successful business people who’ve neglected those foundation blocks in terms of their planning for the long-term.
On top of the triangle
We like to describe our services as sitting at the top of the triangle of wealth advice, legal advice and tax advice, and we feel like we’re ideally placed to be able to deliver that. At the moment of an exit we want to make sure our private client team is in place to make sure that trust planning is getting done that Wills and NBAs are up to date.
No added complications
We realise some clients only want safety and security, and we can absolutely provide reassurance that on Day One there will be no risk attached to this, just tax-efficiently managed. It’s probably been a gruelling process over many months, and potentially longer than that, so we don’t want to add any complications in their lives at this point. They need to have some ‘fun money’ too of course. They deserve a bit of a pat on the back and with money put to aside they can do something a bit frivolous, they’ve earned it.
Managing expectations
Sometimes there’s a mismatch between lifestyle expectations and actually what has been delivered in terms of consideration at the point of an exit, and we have to manage that with individuals because they sometimes their expectations in terms of what they can now spend and what they can buy and what they might want to use for more angel investing is out of kilter with reality. And it can be a sensitive subject to manage sometimes.
Nick McQue, ceo, Shoptimised
Shoptimised is a Google shopping marketing platform for agencies and retailers based in the North East. LDC recently funded the management buy-out.
The route to the MBO
We are a founder-led business which has now transitioned into an MBO. I’ve been employed in the business from Day One. The two founders and I built the business together but after six years of good growth the founders wanted to exit. The business was structured for the purpose at that time, rather than being a scalable infrastructure. The MBO was therefore a means of releasing the founders, to de-risk them, and also to allow me and the team to step up and take the business on. We therefore went into the MBO with LDC who I can’t speak enough about, their experience and support has been brilliant. Working with them, we needed to get the infrastructure right to make the business scalable.
Post-deal activity
This is my first year as ceo and it’s just been about establishing a team infrastructure and growing the business that way. I’m not focused on whether or when I might exit, it certainly isn’t something I’m considering yet. The MBO has created quite a large director team and they all want their own incentives and have their values and ambitions as well. So aligning those over the next couple of years is going to be a really important priority for me. We’re now looking towards M&A to help accelerate our recurring revenue.
The future
The future for Shoptimised, now we’ve been able to maximise the infrastructure and scalability, is clear. We need more enterprise level retailers. pushing to work with high-end brands. We have hundreds of SME retailers, but we have a very small core enterprise level. We’ve rebranded this year, launched a new website and new features in a multiple merchant centre approach for online sales, which has accelerated customers that are currently with us, keeping them for a longer period of time. The next level for us is to go multi-channel and more AI, which is evolving super quick, quicker than you can adopt it. We see Shoptimised being an AI assistant, still with humans making decisions, giving paid search managers the ability to make decisions a lot quicker than they currently can.
Peyman Atapour, investment manager, LDC
LDC is the private equity arm of Lloyds Bank, typically investing between £10m to £100m. It is a national business but with a regional focus.
Why invest in Shoptimised?
The financial profile of a business is always the first thing we look at when assessing a business. We back management teams, so we make sure we can trust them and know they have the knowledge, capability and skillsets to carry the business forward. Shoptimised had been carrying the topline 70 per cent year-on-year, so the growth engine within the business was very impressive and we knew it was ranked top amongst its peers. So for us it was taking an entrepreneurial business and putting in structures to professionalise it.
Driving new business
Right from the start when we invest, we want to set out, as a board, what we were working towards and when an exit might happen and what that looks like. We therefore set out a set of pillars together with the team as to how we’re going to grow the business. Shoptimised has always been good at driving new business but there was always a bit of churn, working hard but losing some clients, so actually effectively standing still. So together we’ve put in some things to increase enterprise value and to increase the equity value that we’re going to get at the exit. Ultimately, we are stewards of the business and work with management together to set the strategies.
Will Cooper, ceo, Oddballs
Oddballs is an online underwear retailer and is expanding quite rapidly into Europe. At the same time it is pushing out further into socks and loungewear and nightwork products. The business recently received investment from Alcuin Capital Partners.
How we got to the MBO
Similar to Nick, I was Employee No.1 at Oddballs which was also a founder-led business. Before I took over we were all about creating short-term solutions for short-term gains and therefore not really investing massively for long-term future growth. Covid gave us the opportunity to really scale the business, we doubled turnover in one year and nearly doubled it the following year. During that period I had a clear overview and insight into how the business was operating. This then led to the management buyout in 2022. For me, taking more equity in the business was one of the major drivers of it, as well as providing a good exit for the founders.
Plans for the future
A big aim for us is our international growth. There’s no threshold on the size and scale within the UK market but international just opens a huge opportunity. We’ve been signing a lot of licencing agreements to trade in America and the Middle East to enable the growth to continue and to expand our product range out, making us not just a one-trick pony. We know that if people own a good quality product, they don’t need to buy new stuff all the time. So adding in socks, pyjamas and other products means we get customers buy our products two times a year rather than just once a year for Christmas. We believe this approach will fuel a far bigger pot for a potential exit in the future.
Sahil Nayyar, director, Cavu Corporate Finance
Cavu advises shareholders and businesses across a range of different transactions – sales, acquisitions – but primarily those related with private equity.
Our Oddballs advice
We had been speaking to Will and the team well before the MBO about the right time for a transaction. The MBO allowed the founders to step back from the day-to-day running of the business while incentivising Will to drive its next phase of growth. Between 2022 and Alcuin’s investment in 2026, the business grew exponentially under his leadership. We always knew there would be another event, so we stayed close to Will and became fully engaged during 2025.
Alcuin’s investment gives the business the platform to take a longer-term view and de-risks the position for all parties. The deal succeeded because Will and the management team were hungry to stay ahead of the market. Oddballs is a genuinely dynamic business, and with international expansion now its key growth area and still at an early stage, there is real scope for that to accelerate quickly.
Emotional attachments
You can never underestimate the emotional attachment founders have to their business, particularly in a primary deal. They may have the conviction to proceed, but when push comes to shove, emotions very often come into play.
That challenge is sharper in today’s market. The market has been patchy and difficult, and buyers are apportioning more risk. That means more structure in deals: deferred consideration, earn-outs and rollover equity. For a founder, that can mean their exit becomes a longer journey rather than a clean break, and they may be asked to back the business with part of their proceeds. It tests emotional commitment far more than a straightforward cash deal.
That’s why preparation matters. Founders who have thought hard about what they want from a transaction, both financially and personally, are far better placed to hold their nerve when terms get negotiated. Deals are still getting done, but they reward those who go in with clear eyes.
Kirstie Mckeown, financial planning lead, Rathbones
Kirstie works alongside the investment management team at Rathbones, looking at financial structuring and tax planning.
It’s not just about the business
One of the things we’re very flexible about is getting to know people at an early stage. It’s amazing how many times somebody exits and they’ve got several million pounds going to land in their bank account but they haven’t got an ISA so they haven’t had that financial experience. A big chunk of money lands and they don’t know what to do with it, they have no experience of investing in equity markets, they’ve just been focused on the business. Running a business is obviously very important but remembering to look at those personal bits is really important too.
Business owners need to look at protecting themselves. It’s not just about having the nice things in life, it’s actually about making sure that they’re not going to get burnt by something that happens.
Getting things right post-sale
We deal with clients who are a couple, where one party is very much focused on the business, while the other isn’t, so the risk tolerance can often be very different. It’s an interesting dynamic sometimes with business owners who are partners professionally and personally. Post-sale, we sometimes have clients who actually don’t realise how much they can spend but the most problematic clients are the ones that spend too much and haven’t managed their expectations.
Peter Oram, ceo, PervasID
PervasID is a radio frequency identification hardware manufacturer, providing products into retailers on a global basis, with key sectors being healthcare and aerospace.
The business’ journey
PervasID was a Cambridge University spin-out which the founder had been running for a few years but had been struggling to grow it. So I was brought in by a VC firm to scale it with the intention of exiting at some stage in the future. I spent a couple of years trying to work out where the company fitted as it was operating in almost every sector going and it was all project-based work. I took us into the retail sector as this was our biggest growth opportunity, with a clear focus on the US. We’re now on a growth curve, with a potentially huge transaction coming up in the next few months.
The focus on international growth
The relationships we have with advisers is very important, I like to build them over years, to build up trust. Phil and I have worked together on a few projects and it’s always worked out well.
We’ve been VC-backed for a few rounds now, and it’s been very good for us. The key focus for us now is on international growth, especially in the US. We need to build value. We’ve been a productised business, and now I’ve manoeuvred us in being a servatised business that can build on recurring revenue. We’ve got a potential acquisition happening in the US which would bring more software into the business.
Philip Clare, partner, Muckle LLP
Muckle is a commercial firm headquartered in Newcastle, but with offices in Teesside and Cumbria. It looks after businesses from very small start-ups all the way to some of the largest businesses in the region.
PervasID – one to watch
We got involved with PervasID when Peter joined the business, when he needed to look for a new funding partner. We used our network to introduce them to Maven who liked the opportunity and so invested. We helped with that transaction and have been working with Peter and the team ever since. It’s an exciting business and definitely feels like it’s one to watch and might look very different in a few years time. Like all the professional service advisers here today, we would say the more you speak to clients the better. I like having open dialogues with business leaders so we know where they are so we can help whenever and whatever things happen. And that’s the same with a lot of the clients that we work with.
Early corporate finance advice
Not all deals go through smoothly but if you can get the right people speaking about the business earlier than rather than later it always helps. The sooner you get the corporate finance team on board the quicker they can help position the business in the best way for whatever transaction you’re doing. Our role is to help create value as part of that transaction, and our legal role is to help protect value throughout all that. We sometimes try to do some sell-side due diligence before the transaction takes place, to look at what a buyer might think of the business. The business owner will be under a huge amount of pressure to close a deal. But the sooner they start the due diligence, identify issues and resolve them, the better.
Calum Ryder, former ceo, It’s All Good
Calum has started up two businesses from scratch, one of which was It’s All Good which was sold to Veleo Foods in 2020. He’s currently involved with a coffee business.
Selling the business
It’s All Good was in a fairly saturated market and was a highly capitalised business, which required a lot of upfront funding, as well as working capital to sustain it through the eight years up to the point at which we sold it. The sale process itself was excellent, despite it happening during Covid and we had been affected by Brexit too. We were turning over around £40m and we felt it was the right time to sell. So the deal was in gestation for those eight years and it was actually quite useful having that length of time because you can see what’s going on, you can get into the detail, you see the figures.
Post-sale activity with Exponent
Following the sale, I got involved with Proper Snacks in which Exponent, the private equity firm, had invested. The plans for the business didn’t quite work out but, because Exponent has very deep pockets, they could ride out the difficulty, and will probably sell in the next 18 months or so. I’m now involved with a coffee process company that has a really innovative product. It started as an engineering business, with a very clever founder but who isn’t a businessman. So I’m helping them position themselves in the best possible way.
Keeping founders incentivised
The people who are generating wealth are generally entrepreneurial, and for those people it might seem wrong to lock money away. I rather resisted all that low-risk thinking. That said, since my exit, I’ve matured my view on this over time. Going back a few years investors always tried to keep business owners hungry. I think nowadays investors are quite generous with founders as it keeps them interested and actually this allows the owner to really grow the business to its maximum potential. I was always heavily attached to my businesses, and this did weigh quite heavily when it came to the exit. And of course issues can arise when the founder doesn’t get the exit they were expecting.
Joanne Whitfield, fund director, FW Capital
FW Capital is a SME specialist, investing in businesses. It also provides property development finance.
Getting to the next stage
There are businesses like It’s All Good which had a brilliant management team which were very easy to invest in, we weren’t spending a lot of time looking at the numbers because it was early-stage funding. As an SME funder we pass on to a bigger PE firm to take businesses forward. There are also businesses that come to us that are looking at a management buyout which they want to get funded. We’re looking to participate in that transaction to take the management team to the next stage. We always ask ourselves whether the business will survive when the vendor leaves, that’s the key risk for us. So we’re trying to make sure that the value stays in the business. It’s really important to generate value within the business rather than just offering what’s perceived as a valuable business to the vendor.
Difficult transitions
The emotional aspect of dealmaking is very interesting. I suppose it depends where the business owner is in his or her lifecycle when they exit. We’ve seen owners who have built a business, it’s been their whole life and then it comes to exit and decisions have to be made about whether to keep them in the business because they’ve been instrumental in its success, or whether this will be counter-productive. So it can be a very difficult transition and and there are cases where things went badly wrong.
Graeme Harrison, managing director, CCBS
CCBS is a fully independent commercial finance broker, typically working in Newcastle and Teesside with businesses of all shapes and sizes throughout their lifecycle, be that growth, distress, capex or property.
Two perspectives
I see the deal process through two lenses. I bought the business two years ago, so I’ve seen things as an owner who’s been through an MBO. We are very profitable at the moment but it can be constrained by deferred payments and by debt, so we’re looking at making efficiencies so that when the debt is paid off, we can have more cash to use for growing and scaling the business. The other perspective is that of an adviser, with clients with whom we’ve been on that journey. We don’t necessarily lead on transactions, we’ll normally sit beside a corporate finance team if there’s a buyout. Our job is to source and structure the debt and to make sure that it comes in on time. We also have to manage expectations because sometimes we see scenarios where the transaction is badged in such as way that it just doesn’t work. We therefore need to manage the debt structure within a deal to actually make it fit for purpose.
Understanding risk and reward
It’s been interesting seeing things from an owner’s perspective because it’s possible to get an exit deal wrong. The person who is exiting can emerge with too much risk, while the person who has bought has too much reward and less share of the risk. I’ve seen instances where business owners have ignored their corporate finance advisers and decided to do it themselves. This meant they didn’t fully understand the risk and rewards or the incentives following the business sale. In this case the risk still sat with the seller. The new owners don’t have the control to do what they need to do, because the vendor was so highly risked. When it comes to debt, we assess a business we look at viability, looking at the previous 18 months of trading. From that you can reverse-engineer to see what the growth is going to look like.