Interview: Serial Entrepreneur Cheryl Hardwick of BigPockets
Taking over a company that is 'grossly insolvent' just would not appeal to most, not even to the hardiest of entrepreneur, and yet this is exactly what Cheryl Hardwick did when the creditors of IT Solution were days away from calling in the administrators. Here, Cheryl talks to The NextWomen about her unwaivering resolve to turn around the company, managing to win over the creditors and why she is in no doubt that she will go on to run more businesses in the future.
Tell us a bit about yourself – your education and work experience?
I’m 34, married and have just had a baby boy. My hobbies are quite diverse, ranging from reading to walking, cooking and nature. I didn’t have a particularly exciting or notable education. I went to a local secondary school and then went on to do a course in secretarial studies before moving on to work for a steel company where I worked my way up to a senior level within the sales department. Later I moved into the telecommunications industry where again I worked in accounts and sales. My next move was joining IT Solution which evolved into the position that I now hold.
What is BigPockets and what could it do for me?
BigPockets is a trading name of IT Solution. It is a leading online retailer of technology related products including PCs, laptops, media, gadgets and lots more besides. If you need a cool product, delivered fast and backed up by top class customer service, we can help!
In December 2007, the company behind the BigPockets website, IT Solution, became insolvent to the tune of £600k. What made you step up from company secretary to owner and MD at such a critical moment?
I had spent so much time working for the company that I was saddened and angered that it had got to this stage. Whenever I saw the old owners in action, and with every decision they made, I thought to myself: ‘I would have done it this way’ or ‘I would have done it a different way’. During my role as company secretary, however, I didn’t really have the opportunity to put my ideas into practice. So when the chance arose for me to take over the reins I snapped up the opportunity knowing I could turn it around.
Did you always believe you could turn the business around or did your resolve waiver at times?
My resolve is as solid now as it was when I took over. Call it a cliché, but belief in yourself makes all the difference.
What is the business model and did you alter it when you took over the reins?
When I took over, I immediately downscaled and streamlined the running of the business. We renegotiated contracts with our suppliers and removed all of the non-essential overheads such as Directors expense accounts and company cars, as well as renegotiating the terms of our warehousing and logistics. This in itself provided significant overhead savings and made the business breakeven immediately. From then it was a question of reinvigorating the product range and generating a profit stream.
When did the business break even and do you feel the recession has actually aided the company’s restoration to profit?
We broke even within 12 months of taking over the business. I believe the recession has actually helped, since the economic climate has meant people are looking for ‘bargains’ which we were meeting with some innovative and well priced products which we sourced from bankrupt and excess stock.
Shaf Rasul, CEO of e-Net computers acted as your advisor and mentor throughout the process. Do you think all Founders and CEOs should have such a peer, no matter how large or small their venture?
Yes I honestly believe having someone such as Shaf on the other end of a phone is immensely useful. In my case, having access to such advice and the ability to bounce ideas off him has been invaluable. I also enjoyed proving him wrong as the first advise he gave me when I told him I was doing a management buyout of an insolvent business was ‘why an earth would you do that?’… But I soon talked him round.
You became a serial entrepreneur when you went on to launch the daily deal site Boffer. Did you always have the desire to be an entrepreneur or was it more of a dominoes effect?
From a very young age I had the desire to be my own boss and be in charge. When the opportunity arose to rescue IT Solution, I jumped at it. I never intended to stop at one business, and I will most likely create more. It’s the feeling of success and achievement that drives me – not money. I think this fact has a positive impact on my success.
Did you achieve funding when you took over IT Solutions, and did you find this made funding for your second venture an easier process?
The funding for the first business wasn’t funding in the traditional sense of the word. The business owed £600k to creditors, and the creditors were days away from calling in the administrators. I had meetings with all the creditors and demonstrated my new business plan showing them that I could make the business profitable and repay the debts. The hardest part was talking the first creditor into accepting the plan, but when they eventually did, the rest of the creditors fell quite quickly into place. One of Shaf’s companies was actually a major creditor, and it helped us considerably when I told other creditors that Shaf had accepted our payment plan, and what’s more felt I would achieve the goals. In effect my funders/bankers were the creditors that the old owners have racked up.
The next business I set up was Boffer which I this time needed external investment for. We initially set up Boffer as a trading style of IT Solution. After its first day of trading, which was a runaway success, it became apparent that we would need external funding; otherwise we would end up severely undercapitalised and over trading.
As I didn’t want to give away any of my equity in BigPockets, I decided that I would spin boffer off into a separate company. Once I had created the company and transferred the IP into it, I spoke to Shaf and asked if he knew anyone that would be interested in investing. I honestly just wanted some introductions to investors, especially bearing in mind by this stage I had now made BigPockets into a profitable business that was the way ahead in terms of paying off its creditors and in the middle of a recession. As a result I had gained his respect.
Shaf instantly said he would advance me the funding for Boffer. He even went as far as to say that if I needed an investment in BigPocket, he was my man. As BigPockets was my first business, however, and is very precious to me I don’t think I will ever sell any equity in it.
What single piece of advice would you give to a woman thinking about starting (or indeed taking over) an online business?
You need to be very focused, determined and passionate about what you do. You will also need to be prepared to put in some very long hours, and expect to experience both highs and lows.
On a lighter note, name one website you wish you had founded.
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