Grant Thornton invests in high growth start-up Geniac

10 July 2015

Grant Thornton UK has agreed an investment commitment with Geniac, a UK start-up set up to ‘give companies their time back’ to focus on growth. The firm alleviates the administrative burden by offering business services that cover everything an entrepreneur needs to run and scale their business.

Geniac is a London-based start-up, founded in 2014 by ex-Accenture consultants, Michael Galvin and Eduardo Martinez, with the aim to “take the headache out of fast growth for SMEs.” The firm does this by fully managing these companies’ business support functions through an ‘office as a service’ platform, allowing entrepreneurs and innovators their time back to focus on growth. The service combines accounting, tax, legal, HR and corporate administration solutions into one smart service.

Grant Thornton recently announced that it will invest up to £22 million in Geniac, allowing the start-up company to rapidly build scale in the UK as the firm aims to create up to 400 new jobs throughout the UK in 2015/16. In addition, the founders of Geniac will receive mentoring as well as other resources from Grant Thornton. Grant Thornton UK partners Mark Cardiff and Karl Eddy will work closely with the firm.

Grant Thornton invests in high growth start-up Geniac

“Any large business can trace its roots back to a start-up somewhere in history, where its founders likely struggled with the administrative burdens that come with growing a company. By eliminating some of these barriers and freeing-up valuable time to focus on growth, Geniac's proposition to fast growing small businesses is truly exciting,” explains Cardiff. “Mike and Eduardo have ambitious intentions to level the playing field between large and small businesses, in terms of the quality of support and tools available to small businesses. This will go a long way in accelerating the growth of Britain's next generation of businesses and help develop a more vibrant economy.”

Martinez adds: “We created Geniac to integrate all the specialists and tools a growing business needs, giving business owners complete visibility, peace of mind and the time to get back to doing what they love. Since launching our service in beta mode, we’ve had brilliant feedback from our customers and are excited to officially go live today. The investment from Grant Thornton will allow us to grow rapidly over the next 12 months, enabling us to support even more small businesses in fast growth, across the UK and beyond.”


8 tips for successfully buying or selling a distressed business

18 April 2019

Embarking on the sale of a business is one of the most challenging experiences a management team can undertake. Even serial dealmakers acknowledge that the transaction process can be gruelling, exposing management to a level of scrutiny and challenge through due diligence that can be distinctly uncomfortable.

So, to embark on a sale process when a business is in distress is twice as challenging. While management is urgently trying to keep the business afloat, they are simultaneously required to prepare it for scrutiny by potential acquirers. Tim Wainwright, an experienced Transactions Partner with Eight Advisory, says that this dual requirement means sellers of distressed businesses must focus on presenting their business in a way that supports buyers in identifying value, whilst simultaneously being open about the causes of distress. 

According to Wainwright, sellers of distressed businesses should focus on eight key aspects to ensure they are as well prepared as possible:

  • Cash: In a distressed situation cash truly is king. Accurate forecasting and day-by-day cash balances are often required to ensure any buyer is confident that scarce cash reserves are under proper control. 
  • Equity story and turnaround plan: Any buyer is going to want to understand the proposed turnaround strategy: how is the business going to enact its recovery and what value can be created that means the distressed business is worth saving? Clear presentation of this strategy is essential.
  • The business model: Clear demonstration of how the business model generates cash is required, with analysis that shows how financial performance will respond to key changes – whether these are positive improvements (e.g., increases in revenue) or emerging risks that further damage the business.  Demonstrating the business is resilient enough to cope with these changes can go a long way to assuring investors there is a viable future.
  • Management team: As outlined above, this is a challenging process. The management team are in it together and need to be consistent in presenting the turnaround. Above all, the team needs to be open about the underlying causes that resulted in the distressed situation arising.  A defensive management team who fail to acknowledge root causes of distress are unlikely to resolve the situation.

8 tips for successfully buying or selling a distressed business

  • Financing: More than in any traditional transaction, distressed businesses need to understand the impact on working capital. The distressed situation frequently results in costs rising as credit insurance becomes more difficult to obtain or as customers and suppliers reduce credit. Understanding how these unwind will be important to the potential investors.
  • Employees: Any restructuring programme can be difficult for employees. Maintaining open communications and respecting the need for consultation is the basic requirement. In successful turnarounds, employees are often deeply engaged in designing and developing solutions. Demonstrating a supportive, flexible employee base can often support the sale process.
  • Structuring: Understanding how to structure the business for the proposed acquisition can add significant value. Where possible, asset sales may be preferred, enabling buyers to move forward with limited liabilities. However, impacts on customers, employees and other stakeholders need to be considered.
  • Off balance sheet assets: In the course of selling a distressed business, additional attention is often given to communicating the value of items that may not be fully valued in the financial statements. Brands, intellectual property and historic tax losses are all examples of items that may be of significant value to a purchaser. Highlighting these aspects can make an acquisition more appealing.

“These eight focus areas can help to sell a distressed business and are important in reaching a successful outcome, but it should be noted that it will remain a challenging process,” Wainwright explains. 

With recent studies indicating that the valuation of distressed business is trending north. With increased appetite from buyers who are accustomed to taking on these situations, it is likely that more distressed deals will be seen in the coming months. “Preparing management teams as best as possible for delivering these will be key to ensuring these businesses can pass on to new owners who can hopefully drive the restructuring required to see these succeed,” Wainwright added.