Anthony Morrow has followed an unexpected but equally exciting career path over the past 20 years. Having spent almost a decade at KPMG and Andersens he crossed paths with Paul Hogarth which led him to co-founding Tatton Asset Management plc in 2006. Anthony eventually exited Tatton Asset Management as a shareholder following a successful IPO in July 2017.
He subsequently invested in and sold several financial services companies before teaming up with Duncan Cameron (co-founder of Moneysupermarket) to launch Open Money in May 2017 - a technology platform that aims to bring online, affordable financial advice to those who need it the most and who traditionally haven’t been able to easily access it.
What M&A transactions have you been involved in during your professional career and how has your attitude to them altered over time?
I have undertaken one successful flotation, one not successful flotation, two sales to private equity and two trade sales.
What I have learned – the hard way – is that you really must question why you want to undertake that particular transaction. Is it really the best for the business or is there a personal agenda that is overriding good sense? For example, an IPO may seem like the best way to extract the best value for the business and raise money but are you really ready for the responsibility it brings or could it heighten pressure within the business, distract you from core activities and start an obsession with maintaining share prices.
One of my steepest learning curves was a failed listing which subsequently led to a shareholder revolt, bank involvement and an incredibly difficult period of trading until we eventually sold the business. This was a very tough time, but I now recognise that had we listed it would have been a disaster, our desire for funding was not aligned with our strategy for the business - we weren’t being honest with ourselves and therefore the market. If ‘Deal Fever’ strikes it can be difficult to say ‘No’ to terms and conditions that you aren’t comfortable with.
So how do you avoid making these mistakes?
PREPARATION.PREPARATION. PREPARATION. I can’t emphasise this enough.
Alongside this is setting realistic expectations.
Particularly, the first time you come to raise funds/sell, naivety means that you simply do not believe you will not succeed or that anyone would ever doubt your business plan and all its trajectory projections. The shock of realising that it’s going to be much, much harder than you ever anticipated is not for the faint hearted. Having to sell yourself to 30-40 investors (if you’re lucky) is truly exhausting and emotionally demanding.
Using good advisors who don’t seek to simply flatter you but who you can trust to challenge your thinking is also key. Do not scrimp on lawyers either. Finding the right people is hard – after two decades of working at it, I’m confident I have now built a network of trusted advisors around me.
Be realistic about what your business can deliver and don’t be tempted to inflate anything, especially the numbers. The best that can happen is that you get found out, but the worst is that you actually get the money and then can’t deliver what you promised. You can be sacked. You can lose your business. I’m afraid bear trap clauses are a real thing.
Don’t presuppose which exit you will eventually take; each one has its pros and cons both professionally and personally.
What advice would you give to other entrepreneurs running businesses today?
Personally, I worry most about complacency. Not wanting to see if you can do things better or differently leads to stagnation.
Surrounding yourself with people much brighter than you helps to keep you challenged as does having people from a broad range of skills and experiences – this is where diversity at the heart of things is such a good thing. You simply get a different perspective. I would add that you should be willing to pay for quality people, they are your greatest asset.
Finally – try to give back - to your people and the communities you serve. At Open Money we mandate that everyone in the business spends at least one day per year working at one of our two preferred charities which are Wood Street Mission and Youth Zone in Gorton. We all have skills that we can use to help those around us who haven’t had the opportunities we have been afforded.
What next for Open Money?
Launching Open Money was a real highlight for me – it was my first proper venture into technology, and I can see it’s going to be special. That said, how useful and critical to the business should I expect to be, in say 10 years’ time? If there isn’t another CEO better suited to doing my role – more hungry and more capable – then we aren’t looking at things the right way. I have had an intense period of working through my 30’s and 40’s so it would be nice to think that at some point in the future I would be able to step aside, or down.
It's a dangerous place to be if you believe you are the only one with the good ideas.