Become a Creator today!Start creating today - Share your story with the world!
Start for free
00:00:00
00:00:01
Being an Angel Investor – a conversation with Fiona Hudson Kelly
0 Playsin 9 hours
Fiona Hudson-Kelly has successfully built and exited several businesses and now invests her own money in start-up and scale-up businesses as an Angel Investor.
In this episode of the Abeceder podcast The Independent Minds, Fiona discusses her book Grow and Sell Your Start-Up with host Michael Millward.
Their discussion covers a wide range of questions that entrepreneurs on the lookout for investment will want to know the answers to.
Fiona explains what she looks for in a company that she is potentially going to invest in, the initial due diligence that she conducts, and the things entrepreneurs do that frustrate her.
More information about Fiona Hudson Kelly and Michael Millward is available at abeceder.
Audience Offers
The Independent Minds is made on Zencastr, because as the all-in-one podcasting platform, Zencastr really does make creating content so easy.
If you would like to try podcasting using Zencastr visit zencastr.com/pricing and use our offer code ABECEDER.
Travel
With discounted membership of the Ultimate Travel Club, you can travel anywhere else at trade prices on flights, hotels, trains, and many more travel related purchases.
Fit For Work Look after your health and you will be fit for work.
No point in being in a great job if you are in poor health. That is why we recommend The Annual Health Test from York Test; a 39-health marker Annual Health Test conducted by an experienced phlebotomist with hospital standard tests carried out in a UKAS-accredited and CQC-compliant laboratory.
A secure Personal Wellness Hub provides easy-to-understand results and lifestyle guidance
Visit York Test and use this discount code MIND25.
Visit Three for information about business and personal telecom solutions from Three, and the special offers available when you quote my referral code WPFNUQHU.
Being a Guest
We recommend the podcasting guest training programmes available from Work Place Learning Centre.
We use Matchmaker.fm to connect with potential guests If you are a podcaster looking for interesting guests or if you have something interesting to say Matchmaker.fm is where great guests and great hosts are matched and great podcasts are hatched. Use our offer code MILW10 for a discount on membership.
We appreciate every like, download, and subscriber.
Thank you for listening.
Recommended
Transcript
00:00:05
Speaker
Made on Zencastr.
Introduction to 'Independent Minds' and Guest Fiona Hudson-Kelly
00:00:07
Speaker
Hello and welcome to the Independent Minds, a series of conversations between Abbasida and people who think outside the box about how work works with the aim of creating better workplace experiences for everyone.
00:00:21
Speaker
I am your host, Michael Millward, the Managing Director of Abbasida. And to today I'm joined by Fiona Hudson-Kelly, who is a technology entrepreneur and investor who has started, scaled and sold several businesses and who now is the author of Grow and Sell Your Startup that explains exactly how to do that.
About Zencastr: Simplifying Podcast Production
00:00:45
Speaker
As the jingle at the start of this podcast says, The Independent Minds is made on Zencastr. Zencastr is the all-in-one podcasting platform that really does make every stage of the podcast production process, including publishing and distribution, so easy.
00:01:04
Speaker
If you would like to try podcasting using Zencaster, visit zencaster.com forward slash pricing and use my offer code, Abbasida. All the details are in the description.
00:01:16
Speaker
Now that I have told you how wonderful Zencaster is for making podcasts, we should make one. One that will be well worth listening to, liking, downloading and subscribing to.
00:01:27
Speaker
As with every episode of the Independent Minds, we won't be telling you what to think, but we are hoping to make you think.
Fiona's Career Journey: From Rolls-Royce to HR
00:01:34
Speaker
Hello, Fiona. Hello, Michael. I know you're joining us today from Australia.
00:01:39
Speaker
If you fancy a trip to Australia, a good place to plan your travel is the Ultimate Travel Club. It is where you will get trade prices on flights and hotels and all sorts of other travel related purchases.
00:01:53
Speaker
You'll find a link in the description. Now that I've paid the electricity bill, it is time to make a podcast. Fiona, please could we start by you telling us a bit about your career and why you decided to write a book?
00:02:08
Speaker
course yes so I left school 16 didn't really like school didn't like the authority of school and didn't really get why I needed to learn things like geography when I was never ever going to leave the street from where I was born so it just seemed very irrelevant I was very fortunate and I managed to get an apprenticeship with a company a British company called Rolls-Royce that makes huge aero machines for aeroplanes.
00:02:37
Speaker
And what was fantastic about that apprenticeship is that I discovered a real passion for learning that's been a lifelong passion. And I went through several departments during the training and ended up finishing my apprenticeship ah in the HR and training and learning department.
00:02:57
Speaker
And i loved it. So I did a full circle And ended up being responsible for interviewing and selecting a new apprentices at the end of my tenure.
00:03:09
Speaker
I did something very, very similar. I left school after I pressed exams, but I didn't really learn hu and ended up in similar sort of situation to you on an, on what we would now call an apprenticeship scheme with the national health service, the and NHS.
00:03:25
Speaker
yeah which was intended to so like take me around all sorts of different departments, I landed in HR and training and thought, I love this. And when you said, know, you developed a passion for learning, it just so resonates with me that like, when I was at school, the aim was to pass exams. When I was at work and started working, the aim was to learn, to develop, to grow and to, because it's a completely different type of learning experience.
The Value of Lifelong Learning
00:03:53
Speaker
Oh, completely different. and I think as well, young people now ah leaving school, they're under pressure to choose between work, which could be an apprenticeship or going to university. and The two are not mutually exclusive. I did my first degree, actually it was master's degree, which was my first degree in 2017, you know, at the age of 55.
00:04:18
Speaker
So and learning, I'm passionate about learning as as you clearly are, Michael, and it's something that is with you for life. yes And it doesn't matter how when you do that learning.
00:04:32
Speaker
You've just got to be really interested in you learning something that you can use yeah or share.
Balancing Parenthood and Entrepreneurship
00:04:38
Speaker
Yes, when that switch is switched on you cannot switch it off. It has no return ticket. When you're on that journey to learning, it's like, here we go.
00:04:46
Speaker
Just something that happens. you say Once you stretch the mind, you can't put it back in its box, can you? No, not at all. Not at all. I stayed working at Rolls Royce and I stayed there and had my first child and returned back. i was one of the first women returners back to work.
00:05:02
Speaker
company didn't really have a clue what to do with me. There was no flexible working, no part-time working in those days. My eldest son now is 37. When I had my second child, um I wanted to spend more time ah in a more balance, have bit more work-life balance.
00:05:17
Speaker
So i retrained as a lecturer at local colleges, and I specialised helping women coming back into the workplace, learn IT t skills, computer skills and business skills.
00:05:28
Speaker
And that was great because I was able to work work part time and earn five times as much as I did when I was working um as an employed person at Rolls-Royce. But what it did is it inspired me to start my own business, which is another story. And we'll talk about that perhaps later or another day, Michael. But that's how I got into entrepreneurship.
Writing 'Grow and Sell Your Startup'
00:05:49
Speaker
Before the internet was born, i was 26 when I started my first business.
00:05:56
Speaker
It gave me a passion for creating businesses, especially around technology and things that can really grow outside of your own the world and that's why ended up writing this book 30 years later because this book is what I wish that I'd known all that time ago when I started my own business and I really would like to think that other entrepreneurs don't have to go through 30 years of learning that they can actually read this book and the insights within the book and help them fast
00:06:33
Speaker
back sooner than it's taken me Yeah, so I think and when you set up a business, we all sort of take the the winding road. and We get distracted by all sorts of different things. And I suppose if you've produced the the Roman road, that the straightest route from A to B, people are going to fast track their learning and be more successful more quickly. But it's the mistakes that you make that you learn the most from. If you can avoid the mistakes by looking at people's experience, then you're in a stronger position to understand your own mistakes as well, I suppose.
00:07:05
Speaker
sharing the journey with people that look and sound like you. So I think one of the things that I'm really keen to sort of share on is not just the book and the contents of the book and how you can perhaps circumnavigate some of the mistakes on the entrepreneurial roller coaster, because it is a roller coaster, it's not linear, but but really to try and share some stories and role models of people that come from backgrounds that are similar to yours, that have had some of the hardships that are similar stories to yours.
00:07:41
Speaker
And I think that, I mean, certainly from tech, Michael, very few women are around in tech. You know, my in my world, it's dominated by super bright men, usually white, Gates, Zuckerberg, Larry Page from Google, Steve Jobs from Apple.
00:07:58
Speaker
It's very difficult to relate to them. If if you haven't been, if you're not super smart, and by super smart, I mean you've got a place at one of the best universities like Harvard or Stanford or Oxford.
00:08:09
Speaker
Okay, they dropped out. That was their choice. They got there. you know If you haven't had that that opportunity, it's quite difficult to relate. to that person Yes, I agree with you. There is that.
00:08:22
Speaker
And I agree with A lot of the big names in tech, the people that start the businesses, the Facebooks, the Microsofts, the PayPal and Priceline, eBay, etc., etc., those generally tend to be men.
00:08:38
Speaker
But one of the things I've noticed as well is that when the business gets to a certain size, you start to see many more women taking over the role of growing those businesses. So the the original idea, the original person to set it up, it's very often a man and they get the publicity.
00:08:55
Speaker
But to grow the business, they seemed there seem to be an increasing number of women involved as
Female Representation in Tech and Investment
00:09:01
Speaker
well. well i'm going to say something controversial, I guess, and from history. Women are used to being number twos and not number ones, aren't they?
00:09:08
Speaker
So, you know, if you look at most of the caring professions, the childcare professions, the beauty professions, the nursing professions, they're dominated by by by females.
00:09:21
Speaker
And if you have a look at assistance, personal assistance, executive assistance I see very few guys in those, men in those roles and mostly women in those roles. And and for me, it can feel quite isolating, and quite lonely is I was at an investor conference recently and there was one other woman there that was investing her own money in these young businesses.
00:09:48
Speaker
ah Whilst we may see more number twos coming out from in operations in in in in HR, need to be talking and showcasing and putting shining the spotlight on those entrepreneurs that have really been super successful that are just ordinary people.
00:10:08
Speaker
Yes, I agree with you.
Investment Insights: What Makes a Business Stand Out?
00:10:10
Speaker
Let's talk about some of the entrepreneurs that you have invested in. What do you look for when you are thinking about or considering an investment in an organisation?
00:10:21
Speaker
So I think probably for different angel investors they've got a different criteria but for me personally and i see a lot of pitches i spend a long time um listening and reading and being being pitched to by entrepreneurs but for me the main thing is that i've got to get the problem that they're trying to solve so I've invested recently in one that I can disclose because it's now gone, it's now the finalized around and gone public.
00:10:56
Speaker
So I've invested a quarter of a million pounds of my own money into a company called Distill AI and the business, presents data from multiple sources of e-commerce platforms so it's quite a fragmented space and the problem that they're trying to solve is to have a single source of truth a single dashboard that can predict consumer behavior and if you can predict consumer behavior and preempt it then you can serve to those those those consumers more appropriate solutions. So I got the problem that they were trying to solve.
00:11:29
Speaker
So that that for me is number one. Number two is valuations. um and Just don't get me started on valuations, Michael. Some of them are just absolutely ludicrous.
00:11:40
Speaker
And I know that i i know that The Dragon's Den situation where give me a million pounds and I'll give you 1% of my my startup business type of thing.
00:11:52
Speaker
Honestly, honestly, Michael, it's unbelievable. And I think that having free money um hasn' some hasn't hasn't helped with zero interest rates because obviously where do you put your money? It's not going to give you anything back if you bank it. or um so So it's been very attractive.
00:12:10
Speaker
to invest in in in startups and scale-ups. And that's especially coming over from the US that has inflated the the the valuations of startups.
00:12:22
Speaker
That is cooling slightly, but there's a lag between that reality check.
The Role of an Active Investor
00:12:28
Speaker
So give you it and again the example of Distill AI. It's been around for five years or so. It's got some traction and it's got a reasonable valuation. It's a realistic valuation. So I've got some skin in the game.
00:12:41
Speaker
um I've got to be able to be incentivized. to help that business to grow. got to go It's going to take a lot of time and effort from myself and other investors to really help that business to get to the next level so that we can see a return on our investment for all so all shareholders.
00:13:02
Speaker
And you can't do that if if the valuation doesn't stack up. There's just no return on it for you. Yeah, it sounds like you're a very active investor in businesses as well. So it's not just there's my money. It's you, you work in the business as well, in various different ways. What what sort of activities do you get involved in?
00:13:21
Speaker
It's mainly on a mentoring and nurturing. So I like to try and be a safe pair of hands. So Quite often when you've bought significant investment in, especially when you're mixing angel investors with venture capitalists, you tend to put on a bit of a charade. And i've historically, I've sold two businesses, one that I bought a lot of venture capital funding into, so I know what I'm talking about from the entrepreneur's perspective.
00:13:47
Speaker
And the second one that I bought no external funding into whatsoever when I sold it. I owned 95% of it. First one assault I sold, owned 5%, 4.5%. Second one, with a lot of different shareholders.
00:14:01
Speaker
Second one, my management team owned 5% as a reward, and i owned 95%. So what happens is you tend to play a game, and you're telling the investors almost what they want to hear.
00:14:15
Speaker
And where I come in the...
00:14:19
Speaker
safe pair of hands. Of course, I'm still looking to get a like fantastic return on my investment. I'm an investor, but I want to be able to sort of cut through all of the noise and really give that founder or founders the time and the space to have an honest and open conversation without judgment and without any repercussions because only when we start to sort of peel back the onion peel back these layers and get these conversations going and quite often they're you know emotive as well for their well-being and difficult conversations that they need to have with perhaps some people direct reports or even some of the leadership team
00:15:05
Speaker
it's it's helpful for them to have that safe pair of hands As an entrepreneur myself, I think that when you set up a business that you lack, that you very quickly realize that you lack, is a network or connections with people. When you're when you're an employee working in an organization, there always seems to be someone else that you can go to and have a moan.
00:15:28
Speaker
There's always someone else who knows what you need to know and can help you out. But when you set up a business as an entrepreneur, you are on your own. And you if you don't like learning, don't do it.
00:15:39
Speaker
Because every single day you are going to be learning something new and it won't always be a pleasant experience. That learning may come with a price tag, um which is the most painful type of learning to get because it's when you when you realize you've bought something you didn't need to buy or you've overpaid for something or you've just swallowed something that a salesperson told you because they had a target to meet, all those sorts of things.
00:16:06
Speaker
ah But having someone who is a who's interested and invested in your success as much as you are, because they've got, like you say, skin in the game, i think is ah is a great asset to have. There's immense value.
00:16:24
Speaker
And yet I also think that there are lots of people who will set up a business and say, I'm never going to borrow any money. I'm never going to have an external investor. It's mine. It's mine. It's mine. And you, when you come to sell, instead of selling a wedding cake with six tiers, you're selling a cupcake.
00:16:40
Speaker
found his dila
00:16:43
Speaker
You haven't allowed your business to actually grow, but it does become like a child and it does take on a life of its own, but it needs, it takes a if a village to raise a child. It takes relatives, all sorts of different people to invest in that child and make sure that they learn all the things that they need to be a successful adult. And it's very much the same with a business. it's You might have set it up, but it becomes something that is a life of its own and it needs things that you can't give it.
Challenges in Scaling Startups
00:17:11
Speaker
Yeah, and it absolutely must be. And I've, you know, my last business, I had 55 people working in it when I sold it. So I've walked in those shoes. I've encountered, you know, not being able to make payroll. I've had to sell my sell my house, move my kids over the years into rented accommodation. You know, listen there's very little that's going to come their way that I haven't experienced, not as an investor, but as an entrepreneur.
00:17:36
Speaker
So I've walked those shoes, I've walked those shoes for a long time in several different walks of life. So there's there's not a lot that can shock me and there's not a lot that I can't experience and and support on. And, you know, again, I think that um one of the reasons why companies don't grow and we have a real big problem, Michael, in the and in in this country and across the world ah We have so many startups at the start of 2023, there were 6 million startups, and yet we have so few scale-ups. So less than 26,000 out of those 6 million businesses employ more than 50 people. It's less than 1%. So we've got a huge problem of so much focus on startups and so little um success in in in in in scale-ups. And I think one of the reasons for this is when
00:18:33
Speaker
ah founder starts a business is whether it's a solo entrepreneur or whether it's more than one founder is they don't think enough of how they're going to exit the business and you know very often they will describe the business it's my baby it's my third child well It isn't.
00:18:55
Speaker
It's an independent standalone business of which you have some some some shares. And I think once you start to shift, you're absolutely right, Michael, in what you say. Once you start to shift that that mindset,
00:19:07
Speaker
that this is something that's going to grow beyond you, this is something that isn't going to last forever. mean, my goodness, we don't even know what job roles are going to be around in 15 years' time because of the pace of technological change and other changes.
00:19:20
Speaker
Then it starts to put you into a different mindset in terms of what you're going to create and how you're going to structure that business and how you're going to leave that business, how you're going to exit it.
00:19:31
Speaker
I agree with you, but I also disagree with you. think lots of entrepreneurs do see their business as a child. And I don't think there's anything wrong with that. But they don't allow it to go to school.
00:19:44
Speaker
it' This is going to be my child that is always going to be um a toddler, always going to be at home, never actually going to go off in the world by itself. And Every parent has to um let go of its child.
00:19:57
Speaker
And the reason why businesses don't go through the scale-up process is probably little bit because entrepreneurs don't let go, like you say. They they don't let go.
00:20:07
Speaker
They don't have a plan for how they are actually going to reap the benefits of their business because they've sold it or somebody's come along and invested in it and they've been able to take some money out of the business.
00:20:20
Speaker
Whereas the child analogy is quite pretty because parents do spend a lot of time examining different education options. Which school is my child going to go to? Which clubs will they belong to?
00:20:33
Speaker
Why do I want them to go to university? It'll be their decision, but where do I want them to go? All these sort things. People spend a lot of time planning the future of their families, but it does seem that entrepreneurs can sometimes start off with a business that could become scale-up and a corporation, but because of the attitude towards it it remains a lifestyle and running it becomes an all-consuming lifestyle rather than bringing the people in, bringing the employees in, taking on great HR people like me and helping to grow that grow that business. Yeah.
00:21:08
Speaker
and sales and marketing and quite often their their business can never grow big enough because the market size and their niche niche within that market size isn't isn't big enough. So sort of working through all of those strategies at the start when you're starting your business. And I guess as a mum of four and I've been a single mum for 20 of those 37 years raising my children, was supposed to mean I have a bit of a different take on that as well because I don't think as a parent, I don't own my children. yes I gave birth to them, but they're separate entities.
Viewing Businesses as Independent Entities
00:21:42
Speaker
And hope with my children, i hope I've inspired them to be kind and good citizens. But I've hope I've inspired them to go fly the nest, have some fun, knowing that there's a safe pair of hands there when it all goes pear-shaped they come tumbling down, they can be brushed down and off
00:22:00
Speaker
Off they go flying again. And I know that's a different and type of of thought to other parents, but that's how view them. And that's how I view a business. I didn't always view a business like that.
00:22:14
Speaker
That's how I view business now. It's not an extension of me, separate entity that's going to come to an end at some point for its own well-being as well as your own. Yes. Fernand, this has been really interesting. We've only scratched the surface of the contents of of what is a really excellent book, which, like say, takes you deep inside in some ways into the the entrepreneurial experience and creates this, you know,
00:22:41
Speaker
If there's one key message that I think we can take from from the book is that you have to, you if you are going to set up a business, you have to have the whole strategy, the business plan of how you're going to set it up, how you're going to build it, how you're going to make sure that it provides an income for the lifestyle that you want to have.
00:22:59
Speaker
So it enables you to fulfill your lifestyle aspirations. But also, i When you're setting it up, you need to have worked out how you're going to hand it on to someone else.
00:23:12
Speaker
What's your strategy for retiring, for being the things that you you set up a business to do. You don't set up a business to work seven days a week, 24 hours a day. You set it up so that you can ah you can achieve a lifestyle that you aspire to.
00:23:27
Speaker
think a lot of entrepreneurs
The Importance of a Complete Business Strategy
00:23:28
Speaker
forget that. But i think the key message is that you need to have a strategy for how you are going to hand the business on to someone else, how you are going to exit.
00:23:39
Speaker
And you need to do that and have that strategy before that question is actually asked. It's like you can't start a journey without knowing where your destination is going to be.
00:23:50
Speaker
know your destination yeah yeah spot on there michael yeah and went to self yes you know fiona we have scratched the surface of the book very i'd like to you know i'm going to invite you back at some point as well because there's so much more than i think we can we can discuss that um the book is excellent i would recommend it to everybody there is a link to it in the description ah for the moment. Fiona Hudson-Kelly, thank you very much. I've really enjoyed our conversation. Thank you, Michael. Me too.
00:24:21
Speaker
Thank you. I am Michael Millward, the Managing Director of Abbasida, and I have been having a conversation with the independent mind, Fiona Hudson-Kelly, the author of How to Grow and Sell Your Startup.
00:24:35
Speaker
You can find out more about both of us at the abbasida.co.uk website. There is a link in the description. listening to the independent minds on your smartphone, you may like to know that 3.0 has the UK's fastest 5G network with unlimited data.
00:24:52
Speaker
So listening on 3.0 means you can wave goodbye to Buffering. There is a link in the description that will take you to more information about business and personal telecom solutions from 3.0 and the special offers available when you quote my referral code.
00:25:07
Speaker
The Independent Minds. Our aim is proactive positive ageing. Knowing the risks early is an important part of maintaining good health. That is why we recommend the annual health test from York Test.
00:25:20
Speaker
York Test provides an assessment of 39 different health markers, including cholesterol, diabetes, vitamin D, vitamin B12, liver function, iron deficiency, inflammation, and a full blood count.
00:25:35
Speaker
The annual health test is conducted by an experienced phlebotomist who will complete a full blood draw at your home or workplace. Hospital standard tests are carried out in a UKAS accredited and CQC compliant laboratory.
00:25:51
Speaker
You can access your easy to understand results and guidance to help you make effective lifestyle changes anytime via your secure personal wellness hub account. There is a link and a discount code in the description.
00:26:04
Speaker
That description is well worth reading. If you've liked this edition of the Independent Minds, please give it a like and download it so that you can listen anytime, anywhere. To make sure you don't miss out on future episodes, please subscribe.
00:26:19
Speaker
remember the aim of all the podcasts produced by Abucida, is not to tell you what to think, but we do hope to make you think. Until the next episode of the Independent Minds, thank you for listening and goodbye.