Funding the Future: unlocking capital to power the growth we need12:00 am - 1:00 pm
An independent optician with the vision to grow
In March 2020, BGF invested in Bayfields Opticians and Audiologists. The funds will be used to support Bayfields’ organic growth across its existing group – including further roll-out of its audiology services – as well as its acquisition strategy to double the number of sites over the next four years.
Royston Bayfield, Bayfields Opticians, and Chris Boyes, an investor in BGF’s Yorkshire team, talks about the ins and outs of seeking and securing growth funding.
Why did you choose to partner with BGF?
“Very simply, it was about the culture and feel. We’ve put a huge amount of effort into the culture of the business. In fact, we refer to it as a family within the business. Anybody we want to work with – whether that be a supplier, or financial partner – needs to be culturally-aligned to our way of thinking. When I first met Chris and the team from BGF, we got on very well and I sensed they were good people – they understood our culture and wanted to safeguard it. At the same time, I liked their approach of being hands-off, when needed, but equally having a supportive nature. A bit like a family – always there if you need them.
“We’ve been courted by a number of private equity companies over the years, but when we decided to go down this route in 2019, and we began discussions with BGF, I felt really reassured and trusted them. Trust is a key piece.”
When did you know you wanted to expand the business?
“At the start of 2019, myself and our FD had a conversation – a conversation about where we should go next. At this point, it was step-change time. We’d built something up; should we take that and use it as a platform or hang tight and stay as we are. Initially, we did some risk analysis, and, from a financial perspective, growth was far less risky than staying the same. Personally, I like to always move forward at pace, so the risk was actually me if we decided not to do anything.
“I spoke to the rest of the team, to check that everyone was up for the challenge and they were. We had a number of conversations with investors, but I just didn’t get ‘that’ feeling from a cultural point of view. We then appointed a corporate financier. I’ve done a number of acquisitions in the past, but I’ve never put together a deal like this before, so we wanted someone who knew what they were doing to help guide us through the process. We then quickly decided our preferred route was with BGF.”
What’s made the business successful to date?
“It’s definitely the people who are involved. We are a family, and everyone involved in the business pushes in one direction. I liken it to a game of rugby. When you play rugby, you have a scrum of eight people who come together, all doing different jobs, but everyone needs to work uniformly to drive forward in the same direction. Our aim, therefore, is to always bring people onboard who have a common vision and values to push in the same way.”
Where next for Bayfields?
“We all have the shared ambition to build this into a world class brand. We’re unique in our industry because of the effort we make to understand everyone who comes through our door, creating a bespoke service for them.
“We’d like to double the business, in terms of sites, in the next four years to the 40 mark, as well as doubling revenues from where we are now.
“The average size of each individual site is growing. We want to replicate that over 40 sites but, at the same time, ensure that we’re best in class in the towns where we are based – a world class brand. There are clearly bigger players in the market. In terms of the sites we have that are in the same towns as the ‘big three’, we want to be known as number one for quality.”
What advice would you give to other business owners embarking on their funding journey?
“Find a partner who you feel comfortable with and make sure that the whole process feels right. It’s that hearts and minds approach. I firmly believe that if it doesn’t feel right then it’s for a good reason. I speak to Chris at BGF on a weekly basis and I genuinely enjoy those conversations. He acts as a sounding board and an extension of our team and that’s a critical piece in making it work.”
What lesson have you learned through the investment process?
“We completed this deal pre-COVID and then the pandemic hit and forced us to do things differently. We’ve probably communicated more with BGF during this period than we would ordinarily do, but I think that the relationship has grown stronger because of it. We’ve all ended up in a strange world, but we’ve got to know them more as a result. Don’t skimp on the getting to know the people bit – it pays dividends down the line.”
Why did you want to invest in Bayfields?
Chris Boyes, Investor at BGF:
“This business and its team tick a lot of boxes in what we’re looking for when an investor is considering an opportunity. Royston’s leadership and openness to taking counsel from his management team and external expertise is a real strength in an entrepreneurial CEO.
“The calibre and track record of this team means Bayfields is able to remain focused on: the quality of the care it provides for clients; ongoing expansion through acquisition and market-leading communications both internally and to consumers.
“We first started talking to this business when it was at six sites and we’re just announcing the 20th and 21st site. The combination of a proven team, model and the size of market opportunity made this investment a compelling one.”
What made the timing right?
“We’ve been in conversation with Royston and the team for a number of years and initially we both decided it was too early for the business, in terms of investment and growth. The timings of any deal have to be right. If you go too soon, then the valuation may not be there. When they came back to us at the end of 2019/early 2020, the company had achieved sufficient scale and was trading in such a way that gave it enough width and depth to allow senior management to accelerate growth. If you get your timings wrong then there’s a danger that you won’t have the right team or processes in place to achieve your aims.
“There are 8,000 independent opticians in the UK and between 5 and 10% of these fall into our acquisition criteria. Although it sounds straightforward, buy and build isn’t an easy investment thesis to get right, as each business you buy has a different culture and geographical spread to try and overcome. However, since we’ve invested in Bayfields, we’ve been extremely impressed with the team’s approach and, in particular, the way in which Royston has communicated with his team. When you speak to Royston, it’s very clear that Bayfields is a family business, so to bring in non-family shareholders was a significant and considered decision for him.”
What are your ambitions or hopes for the team and the business?
“We want to build a truly national brand that’s known for its consistency in delivering high quality optical and audiology services. The market is dominated by a few big players, but we firmly believe that there is sufficient room in the market for us to achieve our growth ambitions by focusing on our brand and proposition. In fact, outside of the top three – Boots, Vision Express and Specsavers – Bayfields is probably first or second, in terms of the number of branded sites in the UK.
“In our view, there’s no single brand that places an emphasis on quality over volume. We do something different.”
What advice would you give to business owners embarking on their funding journey?
“Prepare. Be very clear what your objectives are from the beginning and what’s important to you as an individual and for the company
“As a minority investor, we talk a lot about influence and alignment. Sometimes, business owners can be resistant to bringing in external senior people to the board. But, with Bayfields, we saw a continued progression with the management team and a strong indication that they were open to other people’s voices in the business. In fact, Royston spent a lot of time with our Talent Network – the largest groups of board-level non-executives in the UK and Ireland – to get the right person for the non-exec chair role. It was refreshing to see someone who was so thoughtful about this and absolutely wants and understands the value of that outside perspective.
“Bayfields already had an impressive track record when it came to acquisitions, completing 19 successful deals prior to our investment. That experience and reputation gave us the confidence that we were backing a team that is capable of delivering further growth.”
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