Rutherford Cross recently hosted Richard Logan, Group Finance Director at iomart Group plc to speak at the latest of our Next Generation CFO series in conjunction with Grant Thornton UK LLP.
A chartered accountant, Richard joined iomart, the cloud computing company set up by Angus MacSween, in 2006, but it was his earlier career experiences that led him to make the decision to seek out a senior finance role with a small, Scottish organisation with great market potential.
Early in his career, following a role with a Glasgow firm that went on to become EY, Richard realised that he wanted into the world of industry, and moved to a role with container shipping and oil company, Ben Line Group. With progression within Ben Line in Scotland limited, Richard sought a new role with a strong market opportunity, leading him to join Kingston-SCL, a provider of mobile billing software.
Whilst Kingston was a much smaller and much riskier business than Ben Line, it provided the opportunity to be in charge of a finance function and grow a company in an early stage market. In his time with the organisation, revenues increased from £4m to £50m and headcount from 70 to 800 within 10 years. Eventually Kingston was sold to a German listed company of which Richard became the CFO. However, the technology didn’t keep pace with market opportunity and, coupled with lack of recurring revenue – a must have in Richard’s opinion – the role disappeared.
Richard’s career to date allowed him to establish his key criteria for the next move; to remain in Scotland and within the finance function of a small organisation with great market opportunity – only this time with recurring revenue!
Richard joined iomart six years after it became AIM listed. With cloud computing still in its infancy, the business was not without its challenges and the first couple of years were tough both operationally and financially. However, with the disposal of a non-core operation in July 2008 just a few weeks before the banking crisis, iomart found itself in a position of strength and has since grown to become one of the most widely respected and trusted providers of business-critical managed cloud and hosting services.
In the last eight years, the business has concluded 20 acquisitions, driven revenues from £10m to almost £100m, increased share price from 50p to £4 and currently generates an EBITDA of £40m/annum; all of which has taken its Market Cap from £40m to £400m today.
Richard remains clear as to what has enabled him to build a successful career, encapsulated in his four key lessons on what to look out for in any prospective business:
- Great market opportunity
- Right business model
- Right products/service
- Right people
Richard continues to enjoy the challenge of his role at iomart, but would like to see more of a quoted company culture in Scotland. With only 25 of the UK’s 1000 AIM listed companies headquartered in Scotland, it can be a lonely place to operate. . Despite life being played out in the public domain and the sometime onerous requirements of investor relations, Richard sees huge benefits to IPO over PE investment, especially in regard to managing risk, share option value for all employees and overall job satisfaction.
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