Sunday, December 4, 2022

My First Million: Josh Gill, founder of Everflow

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Former engineer Josh Gill saw a gap in the water industry and decided to launch his own company — supplying discounted water to businesses.

Starting from his living room in 2017, with £500,000 raised entirely through friends and personal contacts, he entered the market just as it opened and saw rapid growth. In the first year of trading, racked up 2,200 customers and a £2.1mn turnover.

Since then, by using technology to simplify getting quotes and billing customers, Middlesbrough-based Everflow has gone on to supply 73,000 businesses, generating a turnover last year of £79mn, with £120mn-plus expected in 2022.

Gill, 35, plans to expand the 170-strong company by disrupting other utilities, beginning with commercial waste collection.

CV

Born: Lancaster, Lancashire, June 27, 1987

Education: 2000-05: King Edward VI School, Morpeth

2005-08: Chemical engineering, Newcastle university

Career: 2012: doubled turnover for the north-east division of Aqua Consultants, an engineering and cost consultancy specialist

2013: built Northumbrian Water’s first in-house software platform.

2015: left to research setting up his business by examining the newly-deregulated Scottish business water market

2017: launched Everflow at the start of the business water market in England, with Newcastle United FC as first customer.

Lives: Hartlepool, County Durham, with wife Lois (Everflow’s head of environmental and regulatory affairs), and baby daughter Jemima.

Did you think you would get to where you are?
Definitely not to where I am today, but at university I was ambitious, hoping to start my own business before I was 30, and I achieved that. I realised I would not end up in engineering, because I could not give it the high level of detail it requires. I prefer to focus on the bigger picture, the widest possible view, seeing all the moving parts.

My father taught history and my mother is a piano teacher. My grandad, now in his eighties, is my inspiration. He started, grew, and sold four businesses in farming, housing, and the motor industry. He quit not too long after making his first million in the 70s, to work smuggling supplies and Bibles to Christians in communist Europe.

While working for Northumbrian Water, I heard about the government creating a new market within the industry for business water suppliers. This deregulation meant that the regional water companies would no longer have the monopoly to sell water for commercial use.

That is where the idea of Everflow was born.

Did the pandemic affect your business?
When places like hotels, restaurants, golf courses and other sports clubs that we supplied water to, had to close their doors, we offered them payment holidays.

We still had a positive outcome. Many businesses which were still trading, looked for ways to reduce outgoings. We saw a 21 per cent growth in new customer sales and did not even have to spend more on marketing. Potential customers found us through word-of-mouth, and business consultants.

Likewise, during the energy crisis, customers are looking for ways to reduce overheads. Already, since the war in Ukraine, we have seen 9,983 businesses switching their water supplier to Everflow, compared with 7,611 from the same period in 2021. That’s an increase of 31 per cent.

Have you found it difficult to recruit staff in recent months?
We found it challenging in the first three months of this year. It was difficult to recruit software developers because London firms were recruiting these people remotely. Suitable candidates in the north-east were able to command London salaries without moving to London.

We had to react quickly, by putting up our salaries and making a huge effort to create a good workplace environment. Our overall benefits package is very generous. We increased our pension contributions which is something other companies are reluctant to do. Everflow allows software developers a lot of freedom in their role, with two days a month to work on their own personal development projects.

Was your first £1mn a major milestone?
The first million profit came in 2018, where we reached £1.9mn. For me it was just another working day as we put everything back into the business. We tend to celebrate when we reach specific customer numbers, like 10,000, and 50,000. The current trajectory for 100,000 customers should be in September 2023. Our profit for last year was £2.3mn, of which we invested £2.1mn in 40 new jobs, in software development roles and the waste collection service.

What was the most challenging period of your career?
There was about six months in the middle of 2018 when cash was tight. It was pretty close. We did have enough customers, but they owed over £1.5mn and were slow to settle bills. We had to quickly hire 10 more staff to focus on chasing payments.

What did you have to sacrifice to start the business?
As I had to work full-time on researching the market, I left my job and gave up a £60,000 salary. I just paid myself a minimal wage, £22,000. My wife agreed she would support us in her role as an asset manager if the business failed. I needed £500,000 at the outset because I had to put a sizeable amount towards recruiting five staff in customer service roles.

What was your best preparation for business?
The contacts that I made while at university and all the way through my career, even among fellow churchgoers. My preparation was recognising that they would be very capable people to come on board. Several years before I started Everflow, I met my chief financial officer, James Cleave, through the Evangelical church I was attending in Durham. He was an accountant with Deloitte.

What is the secret of your success?
The key is that we understand how to make customers’ lives simple and build software to make that happen. When the market for business water opened in 2017, it could take up to a week for a customer to get a quote to switch to another supplier. We were able to provide a quote in 30 seconds.

Typically, we offer customers a 5 per cent saving and the average bill is £1,300 per annum. Most customers save £65 to £110, that can be over £300 if they choose to switch to a three-year contract.

What is your basic business philosophy?
Providing a workplace that people really enjoy coming to. What makes a difference is creating a culture where employees feel valued and can make decisions themselves without needing to go through a lot of red tape. You have to stamp out office gossip and listen to people when they tell you how things could be improved.

Do you want to carry on until you drop?
Absolutely. I love what I do, and I love making things simple. Already this year Everflow has diversified into waste collection. We plan to launch telecoms next year, offering broadband and phone lines. My goal is for the company to provide a single place for businesses to buy and receive one bill for all their utilities.

Retirement seems a long time away. I don’t see myself as retiring early. Maybe in 10 years, after conquering other markets, there are projects I would like to do. I am quite passionate about trying to resolve some of the environmental issues and I would explore possibilities in that sector.

Have you made any pension provision?
I think pensions are good, and all my staff have a company pension, but they are not for me. I know that the value of the business is more than sufficient to provide me with a decent income in years to come.

Do you believe in giving something back to the community?
We have commissioned over 250 wells for more than 500 families to be built in Ethiopia and Pakistan. From the time we offer to provide a well to when it is built is six to eight months, but the actual construction is much quicker. The company has also financed planting trees in the UK, and in Hunan, China, the removal of carbon dioxide from the environment.

Do you believe in leaving everything to your family?
For Jemima and any future child we might have, I will help in any route that they want to take. However, I don’t want any child of mine to feel entitled. Nor would I want the business to leave them millions. I have not made a will, but it is something I need to prioritise over this next year.

What do you consider as an indulgence?
I love bikes, and performance cars. At weekends, I drive a performance-tuned, manual V10 Audi R8, a two-door convertible sports car. I usually order cars to my own specifications. In the last seven years I’ve probably gone through at least 10, mainly sports cars such as an Aston Martin DB11 and BMW M5.

I spend several hours each week engrossed in playing Magic: The Gathering, a strategy card game, devised about 30 years ago.

Numisteamone

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