Mathew Wainwright: Global entrepreneur generating £125m from acquisition sales in 12 months

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Julie Wilkinson  00:03

Hi, I’m Judy Wilkinson, and I’m a chartered management accountant. And I’m excited to be launching the build and exit podcast. This podcast is for business owners and entrepreneurs who are looking to expand their business portfolio by acquisition, or at some point in the future, when to exit their business. We’re going to bring real life stories and experiences of people who have grown by acquisition, who have exited their businesses, and other areas of business such as funding and cash flows. So there’ll be lots of opportunity to learn different areas of business and how you can in the end, transition your business from a lifestyle to an asset to look forward to seeing you soon. Hi, and welcome to the build and exit podcast. Welcome, everybody. Thanks for listening to us. My name is Judy Wilkinson, and I’m the owner and founder of orcas at accounting solutions. I started the build of exit off the back of the work we’re doing Wilkerson’s because we help people with acquisitions and Exit Planning. And I saw there was quite a gap in the market of financial understanding when it comes to buying and selling businesses. So we’ve had lots of interesting guests and I’m really excited today to have Matthew Wainwright with us. Hi, Matthew.

 

Mathew Wainwright  01:11

Hi, Julie. Thanks a lot for having me on your on your podcast.

 

Julie Wilkinson  01:16

You’re welcome. Thanks for coming in. You’re very great guests. So I do get funny with this name. So Matthew is one part one of four partners in Aquilegia capital split of a tricky names, I think I got it right, been partners for three and a half years, looked at 15 acquisitions, group turnover around 125 meal, the premises of what you seem to do is leveraged buyout, so minimal equity down. So I think it’s gonna be a really interesting topic, because I know everybody’s looking for no money down deals as they like to call it. So first of all, let me hand over to you and introduce yourself.

 

Mathew Wainwright  01:53

Yeah, thanks. Thanks a lot for that, Julie. So I think my journey in regards to my personal background, so I was born and raised in Spain, and moved over to London. And while I was in London, my entrepreneurial spark started, I guess, coming out while I was at university. And that’s the point in which I was starting out, did a bit of E commerce. Work on the site while I was at university, found out that that was really hard to pretty much build from scratch because you don’t have, you know, employees, you don’t normally have a lot of capital, you don’t have a lot of resources to yourself. And I got exposed to what is m&a? Right. So a lot of people call it a hack when when buying businesses, because you can buy turnover, you can have staff that it’s already been trained hired, is really working within the business. So I kind of started getting a lot of interest in in the m&a world about five years ago now. So it’s been five years since I’ve been focused on on m&a. And over the last three and a half years, as you very well mentioned, I’ve managed to close 15 companies, they’ve all been leveraged buyout transactions of profitable companies that, you know, we’re looking for some kind of succession plan in place, we provided that through a structure that we can go into within the podcast. But it’s been a really great journey. I’ve been exposed to a different industry. So far, I’ve learned Tom throughout the process. There’s a lot of details that go into just getting one deal done, which I think is really important for for the audience understand a lot of skill sets, which is why, you know, Julie can be a really important resource when we’re looking at buying a company. But yeah, I guess I look forward to going and deep dive into into how we go on about getting deals done, essentially.

 

Julie Wilkinson  03:43

Yeah, definitely. I think where it’d be good to start is for people that don’t know the terminology. When you say leveraged buyout, whatever, it may be explained a little bit about what you mean and how you do it.

 

Mathew Wainwright  03:56

Yeah, so a leveraged buyout is a an acquisition of a company that gets done through debt, plus an equity component, right. So back in 1980s, it was terminology that got really famous, especially in Wall Street for buying an asset heavy industries with a lot of debt. They would structure the acquisition, and then within two, three years, they would refinance that deal, make a bunch of money, and everyone was happy at that point. However, it does also have a bad terminology because a lot of the deals that happened back in the day used to go wrong. So it’s, it’s an acquisition structure that uses det uses a bit of equity. In our case, not necessarily that much more or none at all from from our part. But yeah, it’s very common, I guess, acquisition process in the in the m&a world. For those who don’t.

 

Julie Wilkinson  04:50

Yeah, definitely. And I think I mean, what’s going to be interesting, we’re gonna have a look at our cash flow today because obviously that’s the biggest thing that causes problems in businesses. I know from my perspective from the people I speak to in the acquisition world, I leveraged but I think a lot of people just call it no money down deals, they look. And when they say money down deals, they’re looking for kind of regular heavy asset acquisitions where, you know, they can leverage off that to get the financing. And what I just tried to say to people is, it’s okay doing that. But that doesn’t mean you don’t need any knowledge of running a business or any risk strategy, because at the end of the day, once you’ve maximised the funding, what happens when you need funding for working capital? Now, I’m not saying it will happen, but I think you have to be prepared. So I think you’ve obviously successfully done 15 of these. So it’d be interesting to see your take on how you’re planning and managing your cash flows.

 

Mathew Wainwright  05:41

Yeah. So I think, first of all, when when people say about no money down, it’s not that the owner is not getting any money for the business, he is getting money for the business. But it’s just does it come out of your own pocket, right, as an investor? Or does it come through other sources? In our case, in this case, we utilise personal relationships. And we utilise financial institutions such as HSBC, Barclays, the big ones, we also work with with a boutique firms. So when we look at making an acquisition, yes, we do look at asset heavy industries, we look at companies that have a low debt to asset ratio. That means this means that when we look at a company, and when we look at refinancing the assets, so that we can, I guess, generate a bit of cash for the upfront consideration, we’ve got a good you know, a good opportunity to offer a good amount of cash upfront for the business owner and day one, with a with some kind of seller financing option together with you know, with that initial cash consideration. So it comes down to understanding the asset types that you’ve got within the business, it also comes down to a range in terms with the seller, that makes sense. And then also, obviously, projects and the cash flows and and the risks that come out of that acquisition. I can go into Julie, I can go into how we how we try and mitigate those risks and the things that we look at inside companies. Yeah, definitely. I guess when when we manage businesses, we want to see the working capital needs, we want to see who owes us money. And we want to see who do we owe money to. That’s how we manage the businesses within our portfolios within our portfolio, so that we can keep track of them properly. Now, in order to understand the working capital needs, we’ll look at the total revenue generated, right minus the cost of goods sold. And that gives you a rough estimate. We also project the working capital needs based on the average of the last three years. And we project the I guess, the need for repaying the the interest on the new debt has that has been injected inside the balance sheet. Plus, obviously the I guess, the cost of the principal plus the interest, as well as this seller financing. So we first of all, look at the working capital needs, we calculate that, then we project the cash flows, we’ll look at what the cost of borrowing is, what the I guess the payment terms are and the principal. And then we also project the seller financing note that will be paid over normally three to five years. And based on that we need at least a 50% debt coverage ratio, which means that if a business were to lose harmless profits, it would sell it would still you know, be able to pay its debts when they’re due, essentially. Okay? Those are the main factors that we look at financially, when we look at, you know, analysing the financials of a business, we also look at the risk of the customer. So we credit check the the customers, and we get some good references from them. We also look at the customer concentration within the businesses. And we also project you know what the future costs are going to be from from having employees within the business. So obviously, there’s a massive cost of living crisis going on right now. And that’s an inflation, the cost of materials is going up. The working capital needs will also grow if we grow the company together with the with the employees. So those are components that we also look into, and we take into consideration when we’re looking at, I guess properly analysing the risks of of managing a company. So yeah, it’s a very detailed analysis. Okay.

 

Julie Wilkinson  09:29

Yeah, yeah. It’s music to my ears. I mean, this is all the things that I love. Because I’m a geek. Yeah, we do that. I mean, this is what we focus on when we work people at Wilkinsons, because I think it’s having the right support, isn’t it to build the models? One of the things I see and this is why I talk about a lot, you know, what are the oldest doing in the business, you know, are the current overheads, you know, correct for the business, even the business now, I mean, you’d be surprised how many will maybe not but it’s quite surprising how many businesses actually a kind of a understaffed already in the owners topping up the work. But I suppose the problem is when you come on as the owner, you don’t want to do that job or you can’t do that job because you’re not skilled in it. Straightaway your profits are dropping. So, you know, there’s a calculation isn’t there of excess working capital now, but what’s the real working capital for the bid? And? And how would you then negotiate that? You know, I’m not saying you wouldn’t buy it, because if you’ve got, you know, a good team around you, and it’s a good business, it’s that it just comes down to negotiations that doesn’t it with the seller?

 

Mathew Wainwright  10:30

Yep. Yeah, totally. I think that the work that you guys do at work, it’s, it’s just crucial, right? Like, if you can track the money within the business or the financial with the business, it’s kind of your control the organs within the body, right. It’s what makes the business run or the other day. And it’s really important to take a lot of things into consideration, we actually started out and Julie’s talking about that, with a with an outsourced finance function. Very, very similar to how you guys run right now, we have obviously transitioned into bringing everything in house and having our own CFO and our financial analysts. But for those people starting out, I would definitely, definitely recommend having a really good detailed cash flow forecast off of the businesses, as you progress and having you know, I guess that that external person that can look at the decision with, you know, with their perspective and with their experience, so definitely,

 

Julie Wilkinson  11:25

yeah, I think you’ve done the right thing. I mean, what we tend to do with businesses, because we do tend to work a little puddles, we know really, when you get to about deal four, you do need some form of finance team in house. And that’s one of the things that we do it well, because we do actually help people recruit train and onboard finance staff. So we’ll set the model and up so that when the FD comes in house, it’s already and we know that that’s quite sought after, because finance teams like coming in to things that are in place if people come into messy situations. And then and then we just see the deed, I think what happens in my experience, because obviously I’ve worked in finance TVs before I’ve worked in corporate, I’ve worked in these teams as well done systems and things like that myself systems and projects. And I know that what tends to happen is if you’re doing lots of different projects a deal sometimes the finance teams become or it becomes they become too overworked. And then you might not need a finance person in house first deal, five, say because it’s too expensive. But actually, when you get to DLA you do and that’s because that’s where I think the outsource finance works. Where is it bridges that gap between when do you need the resource in house to when do you actually keep it outsourced? Yeah.

 

Mathew Wainwright  12:31

So I think it’s, as you said, like setting the foundations for maybe the future financing that goes in house is very, very important. In fact, a lot of the businesses that we buy the you will be amazed by, you know, multimillion pound turnover, businesses that don’t really track their accounts on a on a monthly basis. It’s amazing to me how they make money, but they do so.

 

Julie Wilkinson  12:56

Yeah. Although Hawaii, it doesn’t surprise me because I know because I’ll see that 100 balance sheets a month. And actually, when I started Wilkinson’s, I did a survey and I asked 20 businesses of all sizes from about 50,000 turnover to about 20 million and 100% only similar accounts once a year. I was a bit shocked back then, because obviously in practice, then I was in corporate. But it doesn’t surprise me though. But what you’ll find though, the risk is this is why people struggled in COVID, because people manage, but that’s because they’re generally living off other people’s money. So they’re using their money, their tax money, which I’m not saying is a problem, because at the end of the day, that’s how we all manage our cash flow is to utilise our cash at the right time. But when there is a problem is when something happens. So that’s why when COVID came and businesses stopped, it became a problem because everyone had already used all the money. So therefore they now had no money to pay their debts. And because obviously your your tax and your that in theory is just a debt because it’s cash collected that you owe. So it is something important to look at, I think, yeah,

 

Mathew Wainwright  13:56

I think if you were to empathise with say a typical business owner, that is got, say 1 million in the bank, the salaries are, say 100k per month, let’s say. And then you’ve got enough working capital for for the salaries, right. So it’s not something that just really, there’s really urgent to solve, because you’ve always got cash in there. But if you want to professionalise the business, and you want to have like a bird’s eye view of where you’re at, within, you know, within your year, I think that at that point becomes extremely important. And as you mentioned, any emergencies that come up, I mean, if you can’t, if you don’t have a bird’s eye view of where you’re sitting, it just makes financial decision making at least a lot, a lot harder the other day.

 

Julie Wilkinson  14:41

Yeah, my experiences, you know, if you’re just doing the same thing every year, in a way you can just maintain my experience is it becomes a problem. Whenever a scenario happens or you’re trying to expand, that’s when the problems come because when you need an influx of cash, you have no methodology to track it. So if you’re just doing The same thing every year, like you say, with your fixed overheads and your small growth, you know, just your organic growth. It you know, although you probably shouldn’t be analyse it, you probably know you can probably work it out enough to maintain, but it is when you want to do something, then it becomes a problem. So, well, my experience, what’s your

 

Mathew Wainwright  15:17

take on dividend payments? So dividend policies within a company, let’s say a company has made 1 million in profit, right? It is looking at growing within the next few years. And it’s going to need a bit of extra work and cancer, but the shareholders want to pay themselves. What What’s your perspective on on that? Consent consensus?

 

Julie Wilkinson  15:38

Yeah, so Well, I mean, I think a lot of people don’t really understand the difference. So the fact is, when people pay themselves through the business, if they’re not paying a salary, and they’re paying what they classed as dividends, the reality is legally, it’s not actually a divalent dividend at point that payment leaves the bank is actually a director’s loan. And the reason is because you have to have enough retained profit to cover the dividend when you come to declare it, which is usually at the year end most people do at the year end. So there’s nothing wrong with paying the dividends. But what often happens is people over trade, they did it a lot, especially with the siebels loans and the bounce back loans, because people have excess cash through things like that collection, tax collection, loan collection, but actually, that’s not been generated from the working capital. So the bank balance you although so it’s interesting, because the million pound in the bank example you gave actually, I’ve seen people who are million pound cash, but you take off 18 months worth of taxes, three months of that, that they haven’t paid, and I’ve seen it drop to weigh in the forums. Okay. So actually, they don’t have a million, their actual free cash is x. And that’s not even the working capital, that’s just taxes already do. Because they’re not accounting for it correctly on the balance sheet. So it’s making sure you don’t over trade, basically. So that’s why you’ve got to be tracking it. At the end of the day, there’s things you can do to mitigate it. But if once you get to the point you’ve done it, it can be difficult to reverse it. That’s the problem. And then you’re using all your money.

 

Mathew Wainwright  17:04

Yep, totally. I think one of the key things, my, in my experience, at least is to actually calculate the free cash flow, and just make the, you know, I guess, dividend decision from the free cash flow as opposed to Yeah, just just the p&l, because it can be, as you mentioned, very tricky. With, you know, new payments that will come along over the next few few months. They don’t account to or account for sorry, as of right now. So definitely.

 

Julie Wilkinson  17:32

The My view is I don’t think sellers work on adjusted EBIT doors often enough, I mean, I we look at it our business, you know, you have a trading margin, and then so you have an operating margin, and then you have a adjusted margin, I think every business does, because everybody does have some form of one off costs that aren’t ongoing. And so as an example, where the dividends cause the problem, as well is the cash flow, and the tracking is one problem. But it’s also where is the p&l? You know, if they’re taking dividends, they don’t actually report in the salary, which is fine for tax purposes. And I’m not saying you should pay as a salary, but it is quite easy to offline, or just to p&l every month, if you’ve got the right finance team in place to go. Okay, so this is my trading margin imports by operating margin. And it’s fair both ways. Because, you know, if you have a one off cost, let’s just say you had a legal bill that you had to pay that was 20 grand, and you’re operating and your operations are being targeted on their performance. Is it fair for them to get a lower commission? Because you’ve had a 20,000 pound legal? Well, that’s got nothing to do with them. So I think people should be tracking adjusted margins in there in general anyway, because as long as you know, it’s not that complicated is because people don’t so then the question comes when they are paying the dividends, you know, is the p&l got the right profits? The right costume for those salaries as well?

 

Mathew Wainwright  18:48

Yeah, yeah. No. Yeah. Makes sense. Makes sense?

 

Julie Wilkinson  18:52

How do you guys analyse that? I mean, how do you track that?

 

Mathew Wainwright  18:55

So we look at, we look at the free cash flow, most of the times and we do also project, you know, I guess the where the features go in what the working capital needs are going to be like within the business. And then from there, we make a decision. Normally, we have a dividend policy, we’re calculating calculated now at about 20% of the profits will be distributed as dividends to the different shareholders within the business. But it could be increased, that could be decreased. But it really is a case by case scenario. And there’s no, you know, there’s no general pattern that we that we tend to follow on that front. I guess what’s most important is to, for us, at least as owners is to have the seller financing paid off, so that the seller or as buyers, we want to be really good buyer. So we want to pay the seller on time when it’s due and so on and you start paying yourself dividends. At some point. It just doesn’t. Yeah, there’s a misalignment of interests there. But what I would say is just you know, if you were to own the entire business that you didn’t Have any debts and you want it to enjoy yourself at that point, we just make the decision to pay ourselves. But it really does come down to a case by case scenario. So there’s no there’s no strict I guess, formula that we that we use. Let’s put it that way.

 

Julie Wilkinson  20:15

And I think it depends what industry you’re in. So for instance, you do a lot of asset financing, probably. But I mean, you look at it more service based businesses that starts leveraging cash flow financing, generally cash flow financing, we’ll look at profits, less dividends, actually, when they give you the when they give you the cash flow funding. So you know, they will look at average three times three times the profit less dividend, so they don’t look at that cash flow funding. I don’t know that every lender does, but I know a typical lenders would so

 

Mathew Wainwright  20:42

yep, yep. Yeah. Do you guys work with lenders as well? Do you help buyers finance the deals? So like, do you look for lending options? Or do you work with other providers in order to get that funding sorted? Yeah, so

 

Julie Wilkinson  20:57

so we’re not FCA registered. So we don’t provide the funding, but we’ve got a lot of connections to get financing. I mean, we’re going through our own funding round now ourselves for our own business. We do a lot of pitch decks, as you might call them. And the pitches can be a bit controversial. You do need one, you don’t need 100, page one. But you do you do need to understand what you do. So we do a lot of funding for people, I help them build the cash flows, the pitch decks, and the story around it, I suppose is the most important thing, because most people are buying into do really is the business because the numbers are what they are, you know, they can change, do they trust, whoever’s gonna have it can run it. And I speak to a lot of funders and I know the problem with funding that they always tell me when they get the pitch decks is no one’s prepared. It they think just given them a p&l, and this the five year forecast is going to be enough. And when they start challenging the numbers, whether this is a business or a buyer, it’s the same problem. They and they can’t explain it, it puts you on the backfoot. Right at the beginning.

 

Mathew Wainwright  21:56

Yeah, that’s, that’s so so true. So where we’ve got, right now, as we speak, we’ve got nine companies on heads of terms. And that, and before going into the financiers, we create a business plan, we create the projections, we create different scenarios. And not only that, but we actually say defend those scenarios. So it’s kind of like each line item that you create within, you know, the projected, p&l right, you kind of need to be able to defend it. So for potential buyers that are looking at buying business, I think that’s so so important. It before even going to the banks, I think, not sure what you think about this, but also buying profitable, well established businesses, in my opinion, is really, really important. So most of the times he look at distressed deals, there’s a reason why they’re distressed most of the times just because obviously the market may have changed that, you know, the cost of materials may have gone up or whatever. But a lot of times, it’s because of the people within those businesses. So you’re buying into business that may not have the appropriate people to run it. And that just make things a lot more complicated. Whereas if you were to also look at what succession plan you would have in place posed to business owners say leaving the business? I think you would you’d save a lot of headaches, probably that one. Yeah, yeah. Yeah.

 

Julie Wilkinson  23:25

I think it depends where you are in your journey and what you’re looking for. So like, as an example, there’s lots of different reasons people do acquisitions, they even do it to get access to resource like to skill, skilled labour, access, new markets, access supply chains. So as an example, let’s just say, I don’t know, you’ve got a garbage and you could build cards, and you don’t have the machinery to build cars, you don’t have to do a share sale. So you might find a company in administration that’s distressed, that’s got the machinery to build the cars. So therefore, your company is fine. And actually, there might be an opportunity just to buy the asset. So it might be you don’t actually need the customers in this scenario, you just need access to the assets to help you, like improve your mix of services. So therefore, it doesn’t matter if the business is distressed, you’re actually going to get a good deal. You’re just gonna go and buy the assets you want. And a distressed versus will sell assets, you know, because they haven’t got a choice. They need it. So there is good, there is opportunity with distressed businesses.

 

Mathew Wainwright  24:20

Yep, yeah, totally in that in those cases, the stolen opportunity. In fact, we’ve we’ve gotten a deal done for a company that we’re building the food and beverage space, so that the company was going under, and we took over the I guess the assets and also the contracts as well. So contracts would be really valuable going forward. So we we bought the contracts and the assets of the business added to to the UK silence limited, I guess, holding company, and and it’s added about 10 million in additional revenue just from I guess taking a company that was going to go I’m under liquidation and just working out a deal with the owner. So that yeah, totally, there’s a lot of opportunities there. It’s just, you know, what, what are those opportunities for? Right? And do you have something? I guess in the backroom for for those distressed deals to make it work?

 

Julie Wilkinson  25:17

Well, well, you it they work well, when you bolt on. I mean, we’ve just done it ourselves. We’ve just done an asset sale in our own company, you know, we had opportunity, we treat we transferred the staff, we bought the clients, we basically changed it from about a fifth, we probably went up 15 percentage points in margins. So we had no no no, no overheads. So we know offices because we’re virtual, minimal insurance increase, because ours is based on risk of payout, not number of clients, we got better partner rates with systems because you get a lower the more you have, the more licences you have. Because of the services we offer, we can we’ve bought a book of clients that have got a certain level of their certain clientele that you know, need the acquisitions or the Exit Planning. So that’s how we would, that’s how we leveraged an asset sale. So we did an asset sale, not the share sale. And that’s how we leverage it, we probably increase I mean, we’ve only had it for three months, and we’ve probably already increased 15 percentage points, just from the economies of scales from the sale.

 

Mathew Wainwright  26:15

Yep. That’s also something to add to the to the projection. So like kind of the scale and group buying power, right. So if you were to just kind of make sense for like, just by itself, but if you can buy in bulk, or if you can buy in bulk subscriptions, where you can buy in bulk materials, obviously, that normally lowers the cost of of purchase, and you can also project that into the into the future cash flows. And it also increases the profit margins. Right. So it’s totally something that total consider not only risk factors, but also opportunities right, moving forward. Well, yeah.

 

Julie Wilkinson  26:50

Yeah, absolutely. I mean, that’s the that is the biggest benefit, isn’t it, or buying businesses is when you get bigger, you have more opportunity to reduce costs. Because once you start buying in bulk, you know, everybody knows, don’t they, if you had six in different insurance policies, it’s going to be more expensive than if you have one group insurance policy, you know, every everything becomes cheaper in bulk. And that goes for funding. Typically, funding is harder for smaller deals, when you go above five mil funding, it’s much easier to get it actually than it is to get the lower amounts.

 

Mathew Wainwright  27:19

Yep. So that’s one of the biggest lessons that I’ve learned in m&a, it’s easier to get bigger deals done that it is smaller ones, like the the management team is are a lot more professional. They understand the commercial side of getting a deal done, then you go and talk to banks, banks want to would rather lend you 5 million that they would say 200k. Because for whatever reason, there’s a lot of factors, obviously. But they see you as a lower risk profile and the racing time million because you’ve got probably more cash flows to well, you’ve got better projections, you’ve got more assets, you’ve got a lot more things in place, so they can have a better security option over all the lending terms. And yeah, it’s one of the biggest lessons that I’ve learned over the last four or five years. It’s bigger, it’s easier to get bigger deals on there too small. So that’s so true. In my experience as well.

 

Julie Wilkinson  28:10

Yeah, it’s definitely it’s definitely true. Yeah, is so. So I mean, we all come. I mean, I could talk about this all day, we’re coming towards the end of the podcast, but one thing I would be quite interested to know is, so have you come unstuck with cash flows in any of the acquisitions for a reason? Like, how did cash flow difficulties? Yeah,

 

Mathew Wainwright  28:29

so it’s it’s part of running businesses, you’ve got all kinds of difficulties. Some, sometimes that’s just the cash flow, right. Some of us it’s just, you know, I guess there’s all kinds of problems that come as part of our business. So when we come across cashflow problems, there’s different things that we tend to that we tend to look at. Okay. So we’re looking at increasing the cash inside of the business by negotiating debtor and creditor terms, right. So if you get paid earlier, and you pay later, at some point, that’s going to increase the cash within your business. So that’s something that we definitely look into. We also look look into maybe renegotiating any payment terms that we may have. So maybe we owe, say, 100k in March, right? Well, can we renegotiate with the, with our supplier, say, 250 k payments within 90 days, is that something we can do? A lot of times they’re willing to do so especially the opposite as well. So maybe they’re paying you say within within two months, and they pay you this month, an extra amount for say, a discount on on whatever they’re purchasing. So those are things that we also look at. And then also you’ve got additional financial instruments that you can use in order to have more access to liquidity, right. So one of them could be a invoice facility that you race against the debtor book. Another one could be just a finance facility that you can have access to as part of just having a bit more liquidity to play around with, obviously, all this stuff costs money, right? But if the cash flow problem is for, say, March or February or January, and you can get those facilities in place, well then to get dangerous gives you more oxygen to play around with. But obviously, you’ve got to be careful with the cost of, of having access to that Finance Facility. But, but yeah, those those are things that we try and utilise in order to mitigate with those, those situations that always come up. So we’ve got a lot of instruments in place.

 

Julie Wilkinson  30:35

Yeah, sounds good. Yeah, I find what I think is people are too quick sometimes to get the financing. I mean, I, we’ve gone into businesses and turned about 150 grand a cash around in about four weeks, just from internal changes like that, like the debtor and creditor days, but maybe more advanced thinking. So like, you know, my experience, people work well on invoice financing, if you’re in an industry where typically suppliers are getting loan payment terms. So if suppliers are giving you 90 day payment terms, that’s where you want your invoice financing, because you can draw the cash down. However, sometimes we’ve seen it, you know, actually, well, why don’t you just change your mindset and ask for deposits. You don’t have to have invoice financing is that is a way but it’s not the only way. And people are just and this is why, you know the cost. People sometimes say Oh, I haven’t got the money to invest in the finance team to do it. But I’m like, but the costs you gotta pay with the invoice financing over the next five years, it’s going to cost you more than investing in your finance team because actually deposits cost you nothing really apart from a fight apart from a better bookkeeper a bit of finance and a better cash flow. Invoice financing some invoice planning is a great idea. We’ve we’ve helped people sign invoice financing, because there is a need for it. But it’s not the only option. And I don’t think people are thinking strategically enough about their own internal operations.

 

Mathew Wainwright  31:50

So true. So true. I was just looking at financially. But I mean, if you look at strategically from a, I guess a commercial point of view, at any point in time, when you look at closing a sale, right, so let’s say we sell we sell about 75 million worth of caravans right now at this point. So what can we do in order to increase the purchase value, the point at which you know, we sell the carbon, so we can look at insurance, we can look at awnings, we can look at accessories, we can look at TVs, we’ve looked at all kinds of new products that we can add to that bundle of not only selling the cabin, but also selling you know, products around the cabin. And if you can do that, obviously that increases the cash position within the business. And it also improves the cash flow, I guess position moving forward. Those are things that maybe strategically you can think about, maybe you’re selling, say a finance function within a business, but then you could also sell a legal function with just a JV partnership with someone else. So that I mean, those are just ways in which I guess you can creatively think through how to increase the cash position within months in which you may be struggling with with that cash flow. Right. So there’s a lot of things that can go into it.

 

Julie Wilkinson  33:07

Yeah. All right. Wow. I mean, I could talk about this all day with you because it’s really interesting. But one thing to ask is so well, overall, what’s your end game? Do you have one?

 

Mathew Wainwright  33:22

Yeah, I do actually. So I mean, I’ve got pretty big objectives. So or pretty big goals. 25 Right now, I love this game. I love them. And I think it’s really, really entertaining very mentally stimulating, I would say. So I see myself doing this for the next decade. To be honest. I would love to be able to build our group to a billion pounds and turnover plus, I don’t see why we can’t do it. But I feel like we were going to be looking at expanding internationally in the US and the UK, in Australia, also Canada as the main markets. And just keep on doing leveraged buyouts with you know, with a few exits along the, I guess along the years. And yeah, just enjoying the process. To be honest. I can go into a lot more detail about what my vision is, but I’ll leave it there.

 

Julie Wilkinson  34:15

Yeah. All right. So I mean, is there anything particularly Yeah, is there anything to shoot people contact you if they’ve got certain types of deals? What are you looking for? Just to

 

Mathew Wainwright  34:25

so yeah, so I mean, you can we’re looking at asset heavy companies with said obviously between three to 50 million in turnover in those main markets. And if you have any questions or any doubts or anything I can help with. We’re always keen on partner in deals with people you can find me on on LinkedIn at Matthew Wainwright. Yeah, if you just search for that on on LinkedIn, you’ll be able to find me. And I’m always keen on helping people out and seeing whether we can get a deal done together. So So yeah, Well, you can find me online at.

 

Julie Wilkinson  35:02

Brilliant. Well, thanks so much, Matthew. And I just want to say thanks to everybody who’s listening. I’m so excited. We’ve actually just got over 1000 downloads. This is our 14th week. And we’ve just gone over. Well now. Well, now we’re at about 1100, I think, but we was at a 1000 downloads. So if our guests love the show, obviously, there’s a lot of traction and we get a lot of downloads. So hit this, subscribe or leave us a rating and review because we’d love to have comments and people who’d like to come on the show. And I will see you again soon. So once again, thank you so much for taking the time to listen to our podcast. I hope you found it useful. If you did, there’s anyone else in your network that might benefit from our podcast and please share it with them, either just click the link and send it to them or send it in a Facebook group or other social media channel. Don’t forget to subscribe. So other podcasts come to you directly as a when we launch them. So I’m really looking forward to seeing you next time. We’ve got some really exciting things coming up. And we’ll see you again soon.