The drive to be an entrepreneur started at school for Dominic Nowell-Barnes, founder of PoshFlooring.
School got in the way for Dominic Nowell-Barnes. But Leeds-born Dominic was distracted by T-shirts. And then floors. “I went to Queen Elizabeth Grammar School in Wakefield, where a lot of the kids were quite wealthy,” says Dominic. “I didn’t have that same upbringing, so I got quite good very quickly at selling stuff on eBay. That’s where I picked up my basic online selling techniques, buying T-shirts from branded companies and selling them on for a small profit.
“For the first few years after that it was still predominantly eBay, building a background in ecommerce.” So the EX Factor (let’s call it Entrepreneurial Excellence) was in there from the beginning.
“People succeed either with inspiration or desperation. For me it was the desperation of not wanting to have a life where I did not have money. I knew how to buy or sell things from 12 or 13 years old. It was ingrained in me as a way of making money when it just wasn’t there otherwise and was a lot to do with the environment you grow up in as a child.”
That environment includes higher education as well as secondary school. University was something that Dominic had always wanted to do – with offers from four out of the five he had applied to.
“Like any young person, I really wanted a social scene and to go out and meet people and see an area I didn’t know. But the big thing for me was that I was almost told by my family that they couldn’t afford the fees and they made it very real for me about the amount of debt I would be getting into.
“So with the eBay work going well I took a gap year and made about £20,000, just as a wheeler-dealer working through my stock. I could then have gone on and spent three years studying but I had seen what I could do and knew I would still be able to see my friends who had gone to university.
“I also knew that it could take me ten years after I had come out of university to match the money I was making, so it was a bit of a no-brainer financially.
“Practical experience is so important. After all the economics and business I had studied at A-level, I understood what to write down on a piece of paper, but didn’t know how to apply it to a real-life situation. It only started to make sense when I took the year out.”
But 25-year-old Dominic would be the first to admit that sometimes business needs an unexpected bonus to set it off in the right direction. Sometimes that is a job offer or a gap opening up in a particular market. For Dom, it was a family friend who was going bankrupt and suddenly had some flooring in stock that needed to be moved on.
“My family has an interest in interior design and I had been brought up with that in the background, so it all built up over time. I agree 100% that entrepreneurs will always have it in them to develop a business in whatever line.”
The money driver meant costs had to be as low as possible. So no website, no shopfront, just online trading to get his name out and about. This was only seven years ago, but customers were still wary of buying over the web without being able to touch the goods and look the trader in the eye. The flipside of that argument is that as online fraud has grown, people are now becoming wary again - hence the need for Poshflooring to have a reassuring shop in Regent Street, Leeds.
“I just thought I would give it a go. I had been selling the T-shirts and that was going well, but I had no idea how the flooring would be received. All I could see was that there were quite a few people working on the net, so I started when I was about 17 and soon got that call from my first customer who wanted 70 metres of flooring.
“It was bankrupt stock for below market value, so I went from about £150 a week selling T-shirts for £10 to this person placing one order that would give me about £400 profit. That was my Eureka moment where I realised this was the industry to be in.
“It’s a little bit of luck and a huge price advantage because I had no team to pay and the only overhead was eBay - but I think you can still tell when someone has that entrepreneurial streak.”
Dominic’s total self-belief that something would definitely happen at some stage had paid off at a very early stage – but the learning curve had only just begun. “It was incredibly hard growing the business from that start,” he admits.
“I made a lot of mistakes early on – and I would certainly tell any new business that one of my biggest was to recruit from family and friends. It is such a natural progression when you are not confident about the business world to follow your instinct and pitch it within your own circle of family and friends.
“Your family are your blood and if something goes wrong it is just too much of a risk and makes much more sense to have people who are only there because they are employed by you.
“I realise now that when you are recruiting – particularly around and above the £30k mark – it is so much easier to use a good quality recruitment firm to save you all the time
But Dominic’s advice is to stop there. Don’t take the family and friends ‘team’ too deeply into your business until there is a level of success that will confidently support them. It might work out well, but it is an extra burden you may not need in the first year – even if you have his confidence. “I was fearless at the time and was even trying to sell to high street flooring shops as well. But they just laughed at me because I was a 17-year-old walking into their shops to talk business. There was no chance they would trust me, but there are no preconceptions on the internet of who you are, which was a huge advantage.”
If the business was to grow it needed some money, and the early deals paid off as it earned Poshflooring a £25,000 unsecured loan paid to small businesses which have evidence of a period of successful trading. With the help of Business Link, a business plan was also submitted and the loan approved.
Dominic has an interesting piece of advice for entrepreneurs about financing. From his own experience he says ditch the outside investor and bring in a bookkeeper. “It is better to grow organically and still own 100% rather than lose a big chunk to somebody who is just putting a bit of money in for the first couple of years. It then took me five years to realise the importance of having an in-house bookkeeper and finance manager.
“It is easy when you start a business to simply get an outside accountant and give them all the paperwork to sort out. But then you are not really keeping an eye on how the finances are being run, and the value of having someone in-house is that they will look after all that and keep it in order. “I would now bring someone on board soon as possible, which also helps with approaches to banks for more funding.”
The company now has three years of full trading under its belt, which allows it to move to the Enterprise Finance Guarantee scheme and qualify for £450,000 of loans. That means that the Poshflooring goal of becoming the leading wood and laminate flooring company can be accelerated from a ten-year plan to a three-year one. The money will be invested in industry-leading SEO and PPC technology and will also allow Dominic to invest in his own line of products from China.
He now has 12 staff in a business that turns over around £5m a year, and his own character and aspirations have changed just as rapidly. “I am a boss now, still entrepreneurial but now with a senior management team because in order for us to achieve our goals, we need people with the right levels of experience in the corporate environment.
“We are now in a position to develop an 80:20 culture, where any member of staff can ask to spend a fifth of their working time in another part of the company. I would say we employ one or two staff more than we need to give the team the slack to make this happen.
“We have five sales executives and I am aware that if you just sit at your desk day in and day out it is difficult to stay highly motivated and you might be tempted by a better job offer and leave. To keep hold of our staff and help them enjoy their work we let them work on another project or learn another skill.”
The progress of this 25-year-old from the unchallenged confidence of a schoolboy to an employer who is shaking up his sector is nothing less than impressive. He has the support of his management team and has a mentor – former Phones 4U COO Nick Fisher - but the drive is pure Dom.
“It is often said that to be an entrepreneur you have to work 20 hours a day seven days a week – but I don’t agree. I bought into that myself at the start, but I now know it paints a bad image. I became obsessed by the idea of business, but I sometimes regret that now.
“You certainly have to work hard, but I think you can do it cleverly.” Clever defines someone intelligent who is quick to understand, learn, and devise or apply ideas.