How Richard Harpin Built a £4bn Business

0:00I always wanted to think big, grow the business as rapidly as I could. To anybody out there, I would say if you haven't got a mentor, go and get one. People are prepared to give their small amount of help for free because we all know that if somebody helps us, then we can help somebody else at a later stage. Richard Harpin, founder of HomeServe, a business he grew from nothing into a company valued at over£4 billion. Anybody can do it. If I can make it, anybody else can, particularly if you follow that framework. get a mentor, follow those steps, then the only thing that's holding you back is yourself.

0:40Welcome to this special bite-sized episode of Screw It, Just Do It from our back catalogue of over 550 past episodes. So look, I wanted to kick things off with the fact that you built a£4 billion business. You've now written a blueprint so others can do it too. Can you briefly outline the nine steps or at least some of those steps that you've identified before we dive a little deeper? Yeah, and this was looking back at my career and the things I know now, the nine things that I wish I'd known at the start. And if I had, maybe I could have built home serve in 15 years rather than 30. Step number one is copy and pivot.

1:19We're taught at school that copying homework is bad. And my belief is that copying in business is good. Copy, test, improve, You need to have a unique selling proposition, but doesn't mean you can't, as a starting point, copy somebody else's business. And that's certainly what I did. I wasn't clever enough to invent a business model, but I copied Sutton Waters plumbing insurance cover, made it even better and then rolled it out big. And that was the magic model that really worked at HomeServe. very interesting okay and i read you you you aspired to be an entrepreneur from from a very early age what or who or both inspired you it was lord hansen and he flew a helicopter in to have sunday lunch with his parents who lived in the big bungalow at the end of the coldest sack in Huddersfield where I was born and I remember seeing that helicopter and saying I want one of those and my father said well don't be in a civil service like me earning a pittance you need to run your own business so that was my motivation from the age of four or five found out later that it was Lord Hanson and that's what drove me to I think set up and develop five different businesses all different levels of success or failure before I found the magic model of HomeSurf.

2:51And was the ambition at the very start, you know, that big to build a billion pound company, which very few people actually get to do? Or did it evolve into that over time, Richard? Yeah, it was really just to come up with something that was would be successful and sustainable and that I would enjoy running. Never set out with that ambition of saying, oh, it's got to be a billion pound value business. Right. OK. And can you identify a screw it, just do it moment that you decided that now is the time to leave the corporate world, to actually go out on your own? Or was it like a series of moments?

3:33It was one, really. I joined Procter & Gamble in marketing in Newcastle. I worked on a number of brands there. I'd been there for nearly four years. I had kept my entrepreneurial hand in with a business partner. We bought houses in Newcastle, refurbished them, let them out to young professionals like us at 40 quid a room, including renting out the dining rooms in these houses. And the biggest problem, for some reason, all the tenants tended to call on a Friday evening saying there's water, pouring out of a radiator or a block drain in the backyard or the boilers broken down and that would always be in the winter and you could not get a Geordie plumber for love no money in Newcastle on a Friday night they're all out drinking so that was the opportunity and so that was the moment which said I need to give up my full-time job and will put my life savings with Jeremy's into setting the business up.

4:39And that was an emergency plumbing business originally called A1 Fast Fix. And we put in£50 ,000. Is that together or each? That was together. Get an investor. And don't do it when we got one, which was after we'd run out of money. The bailiffs had arrived to take away our office furniture because we didn't have enough money to pay the Vatman. fortunately we managed to borrow a bit of money from friends and family to keep the business afloat but we needed an investor and we went around every water company in the UK thought they would be there's a good link between a plumbing service and a water utility we went around 15 of them and they all said no with one exception little water company north of Birmingham called South staff's water and they said we will put in half a million pounds but we want 52 percent of the equity and so we had to go for it it kept the business going but I wouldn't recommend to anybody giving away majority control more than half of your business particularly in the very early days when we hadn't even proved the model and I'm guessing you felt that was the only offer on the table at that point in time you'd had all these no's um what was the emotions like for you and Jeremy when when you've got bailiffs knocking on the door and trying to take the furniture away because that's a that's a hell of an experience it's uh it's that entrepreneurial determination and resilience which says we've got to find a way through this in the same way that it was those skills that after we'd got the half million pounds investment I grew the business bigger but it was an emergency plumbing model that didn't work people only have a plumbing emergency every five years so there was no repeat business the cost of yellow pages was too high and when we were down to the last 10 000 pounds somebody called me and said there's this water company in surrey that have developed plumbing insurance cover and i copied that model tested it it worked and that was the the turnaround from nearly running out of money again burning through the whole of the half million pounds to making three quarters of a million pounds profit in the following year with the right model that could then be scaled in many countries over time what was the kind of early growth like um for home serve then once um you know you you you got started on that business.

7:21Yeah, talk me through that. Was that early years like that? How long did it take you to get traction? And how long do you think you went from, you know, very much startup to scale up? So yeah, the business grew pretty quickly thereafter. I think by the year 2000, we got a million members. And this was a UK only business by that stage. And it got up to revenue of around 50 million pounds. Wow. And how many years into that into the journey was that, Richard? That was eight years in. Eight years in, wow that's pretty impressive. What was the emotion like when you're signing up those companies that had said no to you initially, it must be pretty satisfying.

8:05Yeah that was great to find a model that they would sign up to and I think it's down to one of my behaviours and values which is persistence pays and I think that's really important eventually uh you can get a deal you've just got to be really determined yeah no i agree with you yeah that's that's like for me it's like one of one of the top qualities i think just uh until somebody physically tells you to to go away and get to restraining order just don't take no for an answer just keep plugging away this is the one that i think is the most difficult for um us entrepreneurs to accept and that is hire your replacement So I was eight years in and I got a guy that I brought in who'd done business development really well, helped me sign some of the utility partners.

8:56And I thought, I think he could do a better job at running Home Serve UK than me. I was a rubbish chief exec, called him into my office and said, Jonathan, congratulations, you're promoted. I'm giving you my job. That then meant I could work on the business rather than in the business. and enabled the UK to keep growing, to deliver the right quality of customer service, and then freed me up to think about, I wonder if HomeServe would work in a foreign country. And it did eventually, and our first international development was in France. A few things that really stood out from that for me. First off, you don't need to invent something completely new.

9:42you can copy, test, improve, and pivot until you find a model that works. Second, persistence pays. Most people stop too early, but the people who win keep going until the no turns into a yes. And third, if you want to scale, you've got to hire your replacement and work on the business, not just in the business. That was Richard Harpin on Screw It, Just Do It. And if this resonated, please share it with someone who needs it and check out the full episode for the complete conversation. Until next time, screw it, just do it.