Tuvey, who founded the internet security company with his brother Roy before selling it to Cisco Systems in October 2009 for $183 million (£111 million), says that as in romance, business owners and managers need to be proactive to reach their goals.
‘I was thinking about my exit before I had a business. Unfortunately it took 10 years to happen,’ Tuvey told a group of start-up business owners at Seedcamp London, a start-up mentoring event.
After working as a banker in his twenties, Tuvey says he wanted to join in the dotcom boom and decided to quit his job to start a business. At the time, Tuvey had finished an MBA and his brother was working in private equity. Neither of them had a technical background, but they both had commercial experience.
Despite making progress with a number of ventures, including email marketing service Mailround.com, the dotcom crash hit the pair hard. Wanting to continue running their own business, the Tuvey brothers came up with the idea of using their technology to create what Eldar says was the first online security company to deliver its software as a service.
After three years of hard work selling to major clients and creating a presence, Tuvey says that by 2005, ScanSafe had an ‘extremely well positioned product for the market’. It was around this time that Cisco first approached.
Tuvey recalls, ‘I got a voicemail from Cisco, saying ‘we are interested in what you are doing, can we speak?’ I put my feet up thinking this is it – they want to buy it.
‘We met Cisco, and then nothing happened. Went to Google, and nothing happened.’
Despondent, Tuvey says he continued to work on building the business but had a renewed sense of focus on an exit. The problem though, he adds, is ‘as soon as you are on sale, no one wants you’.
See also: Planning an exit strategy? Why your profile needs to be on the agenda – Here, CommsCo explains why managing your PR when your business exits is vital.
Tuvey says his success in securing the 2009 deal with Cisco came down to perseverance and the ability to build strong relationships with potential suitors.
‘I like to think about it as finding a partner. You need to be out and about. Be at trade shows, meet researchers, analysts, and others in the industry. Also, you need to be well groomed, not in the dress sense, but you need to know your stuff: metrics, numbers, customer service channels, know the business inside and out.’
However, Tuvey warns looking too desperate to sell will play against the business. He says be connected and in communication with potential acquirers. Don’t outright offer the company.
He explains: ‘you need to keep your fingers crossed that “love will find you”. You need to wait for these guys to come to you, because companies don’t get sold they get bought.’
Tuvey adds that good networking helps creates opportunities, both in generating sales and moving to business exits. He is wary of partnerships, saying they can be a ‘double-edged sword’ for growing businesses.
‘Don’t let them take advantage – don’t play junior or live to regret it,’ he says. ‘Also, if everyone thinks that Google is going to buy you, often everyone else won’t want you – these things need to be considered.’
His biggest tip: ‘You need to stay close with the big guys, you need them to know what you are doing.’
