Just as we’re moving deeper into an interview with managing director Nigel Begg, a bell sounds from a neighbouring room like start of trading on New York Stock Exchange. A cheer goes up. “There’s another new customer,” Begg beams. “A bit like ‘The Office’, that,” he admits. “A bit David Brent-ish. But we celebrate whenever we get a new customer. It’s a bit twee. But everyone gives a round of applause because that’s great. The company is another step forward. So we’re all listening. OK, we’ve got a new customer. What’s this project? What are we going to be doing for them? It gets the buzz going. There’s lots of competition out there but there’s also lots of opportunity.”
The company is Aspire Technology Solutions, a remarkable small business success story in these testing times, showing record financial returns for a sixth year running, and adorned now with a regional business title, having won small business category in the North East Business Awards. Its progress in what could otherwise have been critical years lies in the diversity of its customers. Begg subscribes to Alan Sugar’s view that there’s no such thing as recession; it’s just a state of mind. Begg agrees: “You can’t influence it so why worry about it? It might be harder to win business, more competitive. You have to think differently too. Am I strong enough? Organised enough? Have I the right products and services for our customers?”
Right answers rule at this Gateshead firm where turnover soared 52% in the last 12 months (£2.5m to £3.8m). Sales from 19 different services offered now outstrip the current financial year’s projections. They could reach £6m then about £11m by 2016, for a lot of that business is already contracted. Begg says his 45-strong team - “all young, dynamic and full of energy” - have played their part. “Many have been with us since the start, and everyone has bought into what we’re doing. We pride ourselves on being the best. If we’re the best we’ll naturally be getting bigger.” The firm, specialising in managed networks, data centre solutions and traditional IT support, was only established in 2006. It was a two-man business then, he and 50:50 co-director Chris Fraser, working from Gateshead International Business Centre for the first two years. And although Aspire grew out of there it still provides that centre’s internet connectivity.
Today also - besides premises at Monkton Business Park in neighbouring South Tyneside (where an old coke works once stood), and also a strategic centre at Elstree in Hertfordshire - the company with 98% customer retention now has as its headquarters Heworth Hall, a Grade II listed building erected in 1690 for the local squire. The dignity of the former country seat appears to weather the daily traffic rush of neighbouring Heworth roundabout, beside Felling bypass.
“We wanted to ensure solid roots in the North East,” Begg explains, adding that the company is also about to open a £1.2m data centre of 3,500sq ft alongside, where a greenhouse for the hall’s walled garden once stood. The centre will greatly increase capacity to support its expansion plans, which include a 25% rise in staffing soon. IT customers are now inclined to deal with as few vendors as possible, apparently. Begg suggests: “It makes so much sense to have voice and data altogether as one vendor. That way you’re providing full service to the customer, not saying when an issue arises, for example, that it’s a BT or a Virgin Media matter. We acknowledge it’s an Aspire issue we must resolve. “That accounts for a lot of the growth. We started with many fewer products. As we’ve grown customers have come back and said ‘can you do this?’ So besides new customers, we have existing customers taking more services from us. I always touch wood though.”
Cloud has also changed IT’s landscape over five years, opening opportunity for small and medium-size firms. Begg says of this resource sharing through many computers connected via real-time communication (typically the internet): “Customers can now afford technology and systems not previously possible in their capital expenditure model. They get to rent the infrastructure monthly. “So cloud has lowered the barrier against access to technology. “In a big market shift, businesses are increasingly asking to pay for things monthly instead of making major capital outlays. Previously a project might have cost £100,000. They may have had £60,000 of that upfront. In this different model we’re the service provider. We make the investment in our cloud solutions. Pay as you go for the customer gives them flexibility. He explains further: “We don’t sell anyone else’s equipment. If you want a cloud solution we’ll give an option of going on an Aspire cloud. It’s a day centre with our equipment in it. Or we’ll build you a private cloud where we design and specify a cloud solution for you. You can come into the day centre, touch it, see the blades and the storage where your systems are hosted, as opposed to it being with Microsoft or Amazon.” This, he says, has great appeal for small businesses.
“Every three or five years previously they’d have had to make significant investment. Now they just pay monthly.” But Aspire engages with big business too. Sunderland football club was a milestone engagement two years ago, convincing the firm that if it could win a Premiership football club’s IT business it would be big enough to deal with a client of any size. Primary care trusts use it now, and it has mastered the complex art of public procurement sufficiently to have the councils of Gateshead, Durham County, Northumberland and South Tyneside on its data base also. In the food sector Aspire looks after Linda McCartney Foods, Hartley’s Jam, Sunpat peanut butter and Covent Garden Soup. Its customers extend from Plymouth to Inverness, and out to Gibraltar, Barcelona and the USA. Bonds are strong, too, at one end with London based McNicolas Construction (about 1,000 employees and £250m turnover) and at the other end with John Simes, a Gateshead signmaker employing about 20. Why? “McNicolas was our first client. Its people like dealing with North East engineers and consultants, and the no-nonsense solutions they get. John Simes has also been with us from the start and has grown like us - a great customer, a great company.”
Working with architects and representatives of English Heritage and Gateshead’s building preservation service, to put new life into Heworth Hall, has given Begg a lot of personal pleasure. Internal decor is strikingly black and white, a culture statement underlined by the firm’s customer service policy promising to ‘explore, specify, deliver.’ Begg points out: “We’re a technology business so we don’t wear jeans, t-shirts and baseball caps. This is a landmark building, a way to raise Aspire’s profile rather than being tucked away on an estate.” It’s certainly a talking point. Once neighboured by meadows, its gardens stretched back to the banks of the Tyne. The body of the squire who originally occupied rests now in a mausoleum at St Mary’s Church, which was connected by tunnel to Heworth Hall. The tunnel, which the dual carriageway overrides en route to the A19, is now bricked up. Later the hall was home, Begg’s researches suggest, to the owner of nearby staithes, then the owner of coalmines in Sunderland and Washington. More recently it was a recovery retreat for war victims, then a school and finally a Conservative social club whose members, or their indulgence, became so reduced that the venue was put on the market.
Begg says: “A lot of the character had been concealed. It has been restored and I think it works well having a modern technology company working in a traditional listed building. I also like a challenge.” Nigel Begg, born at Whitburn, left the local comprehensive school at 16 - “for the university of life,” he explains. “I felt I’d had enough schooling.” IT, fortunately, was his passion and he liked working with his hands. He’d written his own computer games as a youngster and was elated to find a job that blended with his hobby. He joined builder Wimpey on an IT project then worked around the UK. He progressed to London, Dallas and visited other parts of the USA. Wimpey sold out to UK Waste, later bought by Waste International, and Begg headed the European arm of the IT section at Waste International, a business massive in its field. Then, 10 years ago, he joined US housebuilder Centex (taken over by Pulte Homes for US$1.6bn in 2009). Centex sent Begg to head up business applications in Europe. But also covering several US states had given him the chance to consider US systems and how they could be Europeanised.
After nearly 20 years in central London Begg formed his own consultancy and outsourced considerably to the North East, whose work ethic he knew first hand. Then seven years ago he returned to the region himself, retaining London clients but setting up Aspire with Chris. Chris leads the technical side - “the best technologist I’ve ever worked with, a genius.” Today Fraser, who’s from Lytham St Annes, lives on The Quayside in Newcastle. Another big personal consideration drawing Nigel back was Louise, now his wife, whom he’d met during an IT project in Hull. They’d set up a home in the North East and for a while he had commuted to London. But, says Begg: “I didn’t want to bring kids up in London. I wanted them to go to the schools I’d gone to. That’s what we’ve done. There’s nowhere else I want to live.” He and Louise now have two boys - Luke, four and Charlie six - and expected another child shortly after his BQ interview. He’d piled his entire London savings into Aspire, enabling the directors to invest about £500,000 in the first year.
“We still re-invest our profits,” Begg says. “We don’t have debt, not even an overdraft. And we’ve no shareholders so no-one can make us go along a certain route. We can spend a lot on research and development.” A conversion of its Monkton premises into a disaster recovery centre is being considered. Begg envisages: “If someone, God forbid, has a fire or flood and can’t get to the office they could go there and we’d give access to all their cloud systems or recreate their IT from back-ups so business could immediately resume. “But is that building big enough? It’s really nice and unlike here brand new. But I may look for a new building. A customer the other day wanted a 70 seat disaster recovery place. I couldn’t put 70 seats in there. The occupants would be like battery hens. “You’re buying a building hoping it will remain empty and no-one will ever need to use it. Yet you still must pay rates and everything else. So it’s quite an investment. But I definitely want a recovery centre.”
Watch out, Oz
With IT now his livelihood, Begg’s restless hands restore cars at weekends. He’s working on his second De Lorean and has an A30 as his pet, though he drives more regularly a BMW 530 GT.
His mind’s still at work even so. An AIM placement, appointment of a non-executive chairman, and the possibility of an Australian operation are all under consideration.
“When we get to £11m turnover and the size when we need to spread our wings a bit more nationally then maybe there could be an IPO on AIM,” he says. “Nothing’s off the table if it makes sense but we don’t necessarily need the cash. What we would like is the mentoring maybe and the knowledge that gives you.
“We’ve got this idea for an Australia office because of the time difference. The majority of our maintenance is done at night. So our Australian colleagues could do that on an evening. We could do the Australian data centre on a UK day time. Nowadays downtime is just not an option. We have to keep people’s businesses running. I’ve no ambition to live in Australia. But some of our younger guys do.”