Megabuyte, 2014. Original article (£).
The Megabuyte Interview: Matthew Riley
Is Matthew Riley a telecoms veteran in the making, or is he already made? Daisy Group may only have been at it for 13 years, but it’s certainly a happening sort of company. The provider of integrated voice and data services to UK businesses has been making its presence felt, eagerly consolidating the sector with no plans to slow down anytime soon. The brazen goal is to become the natural alternative to BT, and the CEO and founder already has a Lifetime Achievement Award under his belt. But how old is he?
Matthew Riley, it turns out, has just celebrated his 40th birthday. “I was grateful and humbled by that award, absolutely. But I have to reiterate: there’s a hell of a lot more to come!” He’s laughing, tastefully modest about it, but the CEO will be the first to say that he’s running a very ambitious company. Daisy now has a 6% market share, with about £100m in the M&A wallet to carry on shopping. The plan is to double the market share in the next five years and become a billion pound company. So what do customers want from a would-be telecoms giant?
The simplicity factor
“I spend a lot of time out with customers, and the main thing they always say they want is simplicity. They want a really simple solution that helps their business run more efficiently. They don’t really care about the technology, they just want to know it’s going to work and it’s going to work for a long time,” says Riley. Dealing with just one supplier is another part of this puzzle, meaning a single bill and a single provider relationship instead of getting line rental, internet and mobiles from three different places. “We have focused on this since the start.”
Founded in 2001, Daisy has grown up with the internet and its disruption of the telecoms market. Is the industry different now, or do people need the same things as always?
“I think businesses still want to run their businesses. Say you have six-seven car showrooms around the UK, your job in life is to sell cars and services and that hasn’t changed. What we do is try and help them do this in an efficient manner,” says Riley. The methods have changed, though; these are exciting times to be in unified communications and IT services. “There’s so much innovation. Rather than seeing it as a bad thing, you have to embrace it. That’s how you help your customers take advantage of it.”
WiFi is the key interest area for customers right now, says Riley, and this may well be the focus for Daisy’s next acquisition too. “More and more of our customers want to be wireless in their offices. They also want to offer that service out to their customers, so when a customer comes into a shop they can get onto the Wifi.” Last year, Daisy did a big project with Waterstones, putting in the technology for browsing customers to buy ebooks then and there, instead of going home and giving their money to Amazon. “We are really starting to see business models change in the UK, to take advantage of technology. Our role is to make sure we are on the forefront of this: be a partner who can offer the full technology solution, and make the customer experience a good one.”
The entrepreneur spark
Daisy’s first deal took place came about five years into the company’s development, and since then it’s been a rapid fire: four acquisitions last year, and two, four and eight in the years preceding. This is a lot to absorb into the company, but if anything, Riley actually wishes he’d started doing deals sooner. “I’d always had a real reluctance to borrow any money from a bank. I’ve always been a believer in saving up instead. But I should probably have grasped the nettle and borrowed a bit sooner, so we could have grown more aggressively in the early days.”
A risky early move that worked out well for Daisy, however, was the trialling of ISDN30 on a wholesale basis for BT. “We were a really small company at that stage, only about 14 people” Daisy has almost 1600 employees now. “The trial took a lot of time and we weren’t really getting any benefits from BT to be the trialist. Still, it was the right thing to do, because it gave us a headstart against the competition on how to transfer these services. We also got a good relationship with BT.” Today, Daisy is one of the UK’s biggest providers of ISDN30 services.
An early mentor for the company was Sir Philip Green, a match made possible when Riley won the Entrepreneur Challenge. Green remains a friend, and Riley is now paying this good fortune forward as an enterprise fellow for the Prince’s Trust. How much is it possible to teach someone to have good instincts for business?
“You can teach someone how a business operates, but whether you can teach someone how to be an entrepreneur I’m not so sure. … I think you can help someone once they’ve decided to go down that route. The Prince’s Trust has a phenomenal success rate in making young people’s businesses successful,” says Riley. We get to talking about how people who brag about their achievements are often less successful than those who are modest, but then again, Riley finds the enthusiasms of American colleagues infectious: “I gravitate to people who are like that – that attitude of ‘Let’s go out there and do something!’ Rather than mumbling about what’s wrong, let’s try and fix it.”
The problem, he thinks, is that Britain has a tendency to scoff at people who try and fail: “It’s easy to have a go at someone when you’ve never tried yourself, because you don’t understand what it means. Setting up a business from scratch is very, very difficult. It takes a painstaking amount of time, a huge percentage of your life, especially if you want to make it a big success.” Riley is warming to his topic now. “If anyone in my team want to go and set up a business I will help them wherever I can, and never try and stand in their way. It may work or it may not, but I think I should give them the benefit of the experience that I have, and help them in any way that I can. Just like someone like a Philip Green helped with me.” On a related note, Daisy is also offering an increasing number of apprenticeships for young people, a model Riley would like to see more of in the UK.
A British empire
Because in spite of Riley’s sometime-enthusiasm for American business attitudes, the heart of Daisy is purely British. Most of all it belongs to Lancashire: Riley grew up in Burnley, and the company’s headquarters are in nearby Nelson. “It’s really important to put our call centre and the vast majority of our staff in an area of deprivation, which is what Nelson and Burnley is. Very high unemployment, lots of ethnic tension. We made a conscious decision to employ as many local people as possible.”
One of the more charming perks of working at Daisy is getting the day off on your birthday, as well as your wedding day. Riley describes himself as a family man, raising three teenagers with his wife: “When I’m not working I’m always with the kids. We go and watch football or rugby, or we’re out doing some sport.” The family just got back from skiing in Val d’Isère, while in the summer it’s mountain biking, water skiing and wakeboarding: “We’re a sporty family.” It’s too soon to tell if any of the kids are budding business people, he thinks, but in any case there will be no pressure from dad: “I don’t really care what they do. I just want them to be happy.”
Riley’s own happy place seems to be right where he is: “There’s something in me that wants to build a billion pound turnover company. I’d like to be part of something with that size and scale – and put my name to it.” The ambition for Daisy has grown with the company; this is the fourth company Riley has founded, and the original plan was to sell after five years. “But then we hit such a great growth rate that it would be crazy to sell it. … Even if we were to sell tomorrow I would never go and retire. I can’t ever see myself retiring actually.” He chuckles. “I’ll be one of those guys at 80, still pottering around. Chairman of the board!”
In the meantime Riley is building his empire, which means creating “mini entrepreneurs” to run the various Daisy business units. “I think that is our key to being successful [as the company grows from medium to large]: people have complete ownership of what they are doing, and really feel their part of Daisy is them. They pass that on to the staff, and you see that running through culturally. … I like people to get on with things. Even if they make a few mistakes – as long as you’re making the right decisions the vast majority of the time, your company will grow and move forward.” He laughs: “There’s nothing worse than working in a business that won’t make a bloody decision!”