Do you start a business with the intention to divest, or is this something that becomes clear as the business grows?
I find building a company from the ground up very exciting, so that is always a leading factor behind starting a new business. Divesting is never the intention when building a business, it is more something that becomes clear over time. The motivation behind starting my businesses is to create value and deliver a meaningful impact into the pharmaceutical and life science space, in whatever shape that may take.
Take Sciformix, for example. As with my other businesses, Sciformix was created in the right place at the right time, offering our ability to combine science and process at a time when other outsourced businesses were only offering one or the other. When creating Sciformix, the intention was not to divest at a later stage, but to deliver value in what was, at the time, a new area in science.
CROs and regulatory consultants had been around for a long time when I founded Sciformix, but pharmacovigilance (PV) was a relatively new area in the industry. As regulations tightened on the reporting of adverse events within clinical trials, the pharmaceutical industry sprang into action, and it soon became clear that the new pharmacovigilance processes were too much, and too lengthy to all be completed in-house within the 15-day deadline for reporting serious reactions. These regulations were very new when we built Sciformix, and as a result we grew very quickly and worked through roughly one and a half million cases per year. When the time was right to divest, Sciformix was acquired by Covance, and it was time to move on to the next venture (Scitara).
How do you know when it is time to divest and move onto your next project?
When you are working on your business, there is not a conscious decision to divest. You know when the time has come to move on – it is like you flip a switch and realise it is time for something new, and you begin to ask yourself “why would I sell?”
Timing is critical when considering divesting. Is it the right time for your customers? Is it the right time for your employees? And is it the right time for your investors? If it is the right time for all three of these areas, then you can begin the transition fairly quickly. However, if only one or two of these areas are ready for this change, you need to step back and ask yourself “how can I make it the right time for all three?”. Thankfully, all of my exits have been at a point where the time has been right for all three parties, so I have left my businesses smoothly and on good terms.
Does divesting affect the company’s customer base, or is there a smooth transition?
Interestingly, a lot of our customers often prefer to work with smaller companies, such as those which I founded, over larger companies who offer similar services. The benefit of smaller outsourced companies – well, small in comparison to the customer – is that the culture is quite different. Smaller companies and agencies can offer a level of flexibility and innovation to customers that can be difficult to pass through larger organisations. In addition, there is a real sense of an “I have your back” attitude, as you are able to work closely with your customers. Culturally and contractually, my companies have been able to offer something different to larger companies, and we have been willing to do anything and everything our customers needed, which is why they would often choose to sign up with us.
However, as the business grows, those customers tend to stay. When customers become a part of your journey, your relationship with them evolves and your company becomes better equipped to protect their business. Because I aim to divest at a time when my customers are ready for it, there is generally a smooth transition.
You mentioned in our last blog that Scitara was your ‘finale’ – what do you mean by this?
As my previous three ventures were in tech, services, and global delivery, Scitara is the summation of all of my previous projects. As I mentioned in the last blog, Scitara aims to solve the major problem within the lab industry of data connectivity and is leading the digital revolution in labs to address this issue. To do this, we will require the cooperation of every connection we have made over the years, as by helping us, we can help them. If we can reach out to everyone in the ecosystem, we will be able to help companies take a huge leap into their digital transformation projects by creating a platform through which they can communicate their lab data through their digital systems, something which at present is proving a real hindrance to digital transformation projects.
This is why I believe Scitara is my finale. It is almost as if we have come full circle, as Scitara pulls together the skills and relationships I have built over my entire career – into creating a final solution. I intend to go out with a bang!