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Letting Agency

Why I Decided To Sell My Letting Agency Business

Sam -

Today I have done what would have been unthinkable only a few months ago.

I have sold my letting agency, Gorgeous Homes.

Why?

The simple answer is to focus on my core business interests.

And unbelievably it is that simple.  Everything else, I have learned, is emotion – and emotion clouds your vision.

Gorgeous Homes started life in August 2007.  I set up the agency first and foremost because I wanted to offer a high level of customer service to my tenants.  At that time, I was running a number of conversion projects in the area.  As a large landlord with properties dotted all over the country, but with quite a few in the Stoke on Trent and Newcastle Under Lyme area, it seemed to make sense.  Plus, I had found ideal premises just down the road from the building sites I was working on.

It’s important to note at this point. I do not live in Stoke and never have – I have always lived in Hertfordshire.  Stoke is a 300 mile round trip from my home…

Anyway, I had found ideal business premises and I was full of the joys of being a “business woman”.  The landlord of the premises wasn’t very convinced – I was a first time business person who had no track record.  But he came round – he made me give personal guarantees, pay a hefty deposit and pay rent in advance.

I didn’t care – I was going to jump through the hoops to do whatever it took.

I took the lease and started preparing the office for our occupation.  Here’s what it looked like before and after:

Gorgeous Homes hartshillGorgeous Homes hartshill

Gorgeous Homes hartshillGorgeous Homes hartshill

 

One week before we were due to open my father died.

My life was thrown into chaos.

At that time I was running building sites, managing teams of builders, trying to get the office ready to open and recruit staff.

I wanted to back out of the office.  I didn’t care that I would lose the 3 years rent I would then be liable for.  I didn’t think I could carry on.

I don’t know how I did it.  Maybe it was because the business gave me something to focus on.  We delayed the opening by one week and Gorgeous Homes opened for business on 13 August 2007.

I don’t have a clear memory of that first year.  I was almost destroyed by grief.

I could hardly face the building sites anymore, for some reason, I blamed them for taking up precious time which I could have spent with my father.

Gorgeous Homes, and the staff I employed, became my lifeblood.

Within a short period of time we had made our mark and successfully taken on a load of new business.

The following 2 years were great – we grew, we expanded, we took on more staff.  Then the growing pains started to appear.  Quantity over quality does not always equal business success.

We found ourselves overwhelmed with a never ending number of problems – non-paying tenants, non-caring landlords and a whole heap of trouble at our door.  Morale hit an all time low.

My new year’s eve was spent on the phone to a landlord discussing the upcoming court case of a non-paying tenant.

Later that night, I made a New Year’s Resolution: I resigned from all “problem properties”.

The 80/20 rule was quite clear to be seen (when you looked!): 20% of our properties made 80% of our cash.  BUT 20% of  our properties made 80% of our problems.  The good thing was: they were a different 20%!

We started to re-focus our efforts on the “better” end of the market – not an easy feat when the UK was stuck in recession and we were operating in an already deprived area of the country.

We decided to take advantage of the depressed commercial property prices and bought our own premises (at auction, of course!) in November 2009.  With over 1500sq ft of space to play with we thought the world was our oyster.  The Regeneration team helped us to transform an ugly derelict building into our gorgeous new offices:

Gorgeous Homes burslem

Unfortunately, looking back now, the timing couldn’t have been worse.  I had started developing property again in London and the South East.  Going to the office and the 300 mile round trip was becoming increasingly time-consuming and a continual juggle.

Hindsight is wonderful.  Now, I can look back and say – why didn’t you sell then?

But I didn’t.

When you start a business, it is your child.  I loved my business, I loved my Gorgeous Homes.  It was a part of me, and a part of my life.  It had my blood, sweat and tears all over the company accounts.

But I didn’t have the time to run it anymore.

I had great staff, but they needed a boss.  And their boss was always at property auctions…

In July this year, my manager left.  I started the recruitment process to find a replacement and was thrilled to find a fantastic employee with the potential to spearhead the office.  I was excited about the future and was ready to build the business again – to push for future growth.

In September/October this year, I took a month out.  With every passing week, I felt increasingly stressed about how I would juggle my commitments to the office alongside my planned property development work.

It was a very simple night out in October when the epiphany happened.  I was sat having a beer at a small bar in a neighbourhood square in Fuerteventura with my other half.  And the realisation just dawned on me:  “I cannot do this anymore.  I cannot split myself geographically to do what is required to ensure the success of the business”.

And it was that simple.

I felt incredibly sad.

I couldn’t believe the decision I had made.  And what shocked me more, was the sheer finality.  I knew then that I was closing the business.

My friend, who is also in property lettings, convinced me I had a business worth selling and that I shouldn’t just close.

I had no idea how to go about selling a business, but I knew there and then that I would have to learn.  My decision had been made – now I had to take action.

I returned from my break on the 16th October.  The next day, I called 3 of my key competitors and asked them if they wanted to buy my lettings agency.  Within 48 hours I had 2 firm interested parties.

I told them the key thing to me was timing.  I was keen to re-focus on my property development work in the South and thus a quick sale was imperative to the deal.  If they couldn’t act quick then the deal was not up for discussion.

I wanted to be able to attend any property auction my heart desired in December.  That meant the sale had to complete by the end of November.

It was a tall order and both my solicitor and accountant thought I was slightly crazy.  I think my friends also thought I’d lost the plot (but they were kind enough never to say anything, and instead showed unwavering loyalty).

On 30th November 2012 Gorgeous Homes closed it’s doors and the new owners took over the business.

How do I feel?

Bereft and excited.

Personally, I believe everybody involved in the situation is a winner.  The new owners are great letting agencies who will give fantastic service to the landlords and tenants.  My remaining member of staff has a fab new role with one of the owners and our premises will be rented to one of these letting agents.

And me.  What will I do now?

I will start a new adventure.

Older and wiser and, with more business nous, I am excited for the future and the possibilities it holds.

35 comments
  1. rich greenland
    Reply

    Sam I have often marvelled at your ability to keep so many balls in the air – it does my head in having too many jobs on the go at once so if you feel it was the right thing then as Jonathan says, it probably was.

    I’m sorry about your dad, I didn’t know that. I lost my mother in 1995 very suddenly, it makes you take stock and gives you a different perspective. A sense of guilt for not having done things differently is pretty common. But very likely your dad was really proud of all you have achieved.

    1. Sam
      Reply

      Thanks Richard – yes, I agree, not being able to let go is a very common issue – emotions run high when it is your own business.

      Rich – thanks for that. Interesting your points you raise on “guilt”

  4. Phil Wheeler
    Reply

    Hello Sam,

    Thank you for posting your story and sharing it with honesty and such clarity. When you start a business people with the employee mindset fail to comprehend the sense of pride and blood sweat and tears that are emotionally invested. I have shared many of your feelings in my own career change.

    To have had an epiphany, which unfortunately some never do, and to successfully have sold the enterprise and moved on is a skill that few people share and one I admire. Well done!

    Thanks for sharing hopefully you will inspire others at this stage to do the same! Your writing style is great and I’ll be subscribing to your blog to discover what exciting things 2013 holds for you!

    All the best,

    Phil

    1. Sam
      Reply

      Thanks so much for your kind words Phil. Well – you’ve put the pressure on now – let’s hope 2013 is exciting – for all of us 🙂

  6. jayneowen
    Reply

    Sam, first, congratuations on the sale. Secondly, what an amazing story, you’ve been through a tremendous amount. I truly admire what you’ve achieved. Very, very best wishes for whatever you take on in the future!

    1. Sam
      Reply

      Thanks so much Jayne – you know from your own experience about building a business from scratch – it’s never easy – but it is so much fun!

  7. Wayne Lawman
    Reply

    Hi Sam,

    Great story, can’t imagine what it’s like to sell a business that you have created, nurtured and breathed! Must of took a lot of courage, don’t think I could bring myself to do it!
    Good luck for the future!

      1. Steve Griffiths
        Reply

        Hi Sam, what I have read about your achievements over the last few years have always amazed me with how much you get done and how nothing fazes you. Reading your own account above and the personal stresses you have dealt with in the backround on top of all your business achievements for me shows your true gritty character and the fact you got through it without giving yourself a breakdown is also testament to your personality and determination, all the very best for the future.

        1. Sam
          Reply

          Steve, thank you so much for your kind words. I am not sure I would say “nothing fazes me” – but I am rather “single minded” when I put my mind to it!

    1. Sam
      Reply

      Hi, thanks. The sale was worked out as a multiple of fee earnings. This multiple can vary by areas and types of properties, but typically in the lettings sector you are looking at a multiple of 1-1.75 times. There is also a consideration given for goodwill.

  16. Jools Abel
    Reply

    Great story Sam, I have been self employed since 1993 and sold my first company back in 2000 after which I started renovating properties. It’s a sad yet great feeling. Unfortunately the idiot who bought my company ran it into the ground!

    A would say that it’s very difficult to value what a company is worth – it all depends on what the buyer is prepared to pay for it, the prevailing market conditions for obtaining cheap capital to fund if necessary and how quickly you want to sell. It used to be based on good will and balance sheet but these days when people are far less willing to be loyal and it’s all based on minimal margins who knows. A good crystal ball and a bottle of wine helps and then of course there is negotiation!

    Great site btw! x

    1. Sam
      Reply

      Hi, thanks for your comments. I am very happy to have sold the business. It is a very satisfying feeling to have built a company from nothing and make it worth something! Fortunately, the new buyers of my company seem to have done well so that’s good. I agree it’s difficult to value a company – but negotiation is definitely an art form done best with a bottle of vino 🙂

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