It’s not often that business people can say that traffic jams on the A1 have led to a positive experience, but for two University pals an especially painful journey served up the spark that launched their business.
Trapped close to the Team Valley back in 2009, an endless stream of brake lights in front of them, Jamie Cooke and Ben Ridgway channelled their frustration into a brainstorming session, and IAM Sold was born.
The pair had spotted a gap in the market for a property auction company to benefit both estate agents and buyers, which would see them manage a range of auction services on behalf of estate agencies across the UK – running both traditional and online auctions.
Leap forward eight years and Newcastle-based IAM Sold – owned by the two 31-year-olds and managed by Jamie – is poised to report turnover of £12.7m for 2016, with a healthy profit line to boot, has grown from a two-man team to employ 70 people. The firm has big ambitions, having already made it into the Sunday Times FastTrack 100 list in 2015 as the 23rd fastest growing company in the UK.
With a new strategy in place to double turnover and headcount in the next three years, the pair are now on the move to new offices and looking to recruit – and they are determined to change the property industry’s mindset and make auctions a mainstream, modern method of buying and selling houses.
“To be honest I don’t really think in that initial phase we ever thought it would grow at the rate that it’s grown,” admits Jamie, managing director of the firm.
The pair had met in their final year at Northumbria University while on real estate management degrees.
They went into different careers but ended up working together at Pattisons, where Jamie, who originally comes from Northern Ireland, had been moved into the firm’s auctions division, having settled on making the North East his home.
He said: “I’ve always been interested in property.
“People always need houses to live in. It’s formed such a phenomenal aspect of the economy, and there’s always going to be a market place in property whether the economy is in recession or not.
“I actually like business building pathology – the structure of a building, how it’s built, maintained, how it can deteriorate and how you can put remedies in place – but ultimately it was the agency aspect that really got me, the pace of sales and helping people find property.”
Thoroughly enjoying auctions, the pair saw there was an appetite for estate agents to work with an outsourcing company which could give them an auction solution.
And this being the recession, agencies were on the lookout for other sources of income, so their timing couldn’t have been more perfect.
The spark of inspiration came during that fateful traffic jam in 2009.
Jamie recalled: “We were on the A1 outside the Metrocentre in the car. That’s when we came up with the name IAM Sold, which stands for Intelligent Auction Management. It was a light-bulb moment.”
Taking a leap of faith, they took loans totalling around £10,000 from family and friends to get going.
Those loans included a very prescient £5,000 investment from a university friend – a gamble that has paid dividends, quite literally.
Jamie said: “At the time a lot of friends said ‘you’re an idiot, what are doing?’ but he now gets a 5% share of profits on a punt he took on us.
“We were both about 24, had no mortgages, no kids, no dependents. The timing was right and the market was ripe.
“People look to auction when times are tough, the wolves are at the door, and they need to sell quickly, and that was the market place we found ourselves in.
“Agents were happy to look at other ways of disposing of property so ultimately we were offering a solution – we felt that we could go to agents and offer them an outsourced solution but we’d do it under their brand, like an extension of their business.”
With the capital to get going behind them, they needed a base.
Literally starting from scratch, their first “office” was in the living room of Jamie’s then girlfriend’s house in Heaton – much to her surprise.
Becky, now Jamie’s wife, wasn’t too happy when she came home from work on IAM Sold’s second day to find Jamie and Ben tapping away on two brand new laptops, bought to reach out to their contacts. A filing cabinet had also been wedged in the corner of the room.
“We didn’t really tell her,” Jamie says.
“I had moved in with Becky, and luckily she was able to keep us afloat for the first little while. It was only for a short time though.”
The company’s first official office was at the Greenfield Business Centre, a move aided by Northumbria University’s Graduates in Gateshead support scheme, but not much time was spent there as the pair travelled the length and breadth of the UK linking up with agencies, enticing them to use IAM Sold to auction properties.
The first to sign up was a Lincolnshire agency. Jamie and Ben booked a hotel meeting room, marketed their first auction and the properties available in advance, and it was a success.
Jamie said: “We were 24, too young to get up on the rostrum, so we got in an experienced auctioneer – we needed someone with a more leathered face to settle the room.
“And it was packed out. There were more than 400 people and 88% of the properties sold, so within 12 weeks of starting we had income.”
More agencies soon signed and, from then, auctions were held every 12 weeks in a hotel.
Growing swiftly, they expanded into new offices close to Kingston Park, Newcastle, where they now have 70 staff, each of whom has been mentored by Jamie and Ben.
And where Jamie was once expecting to cover thousands of miles travelling around the UK to connect with agencies and sign them up, he now has ten business development managers to make connections.
That said, last month alone he visited six towns and cities over three days.
“Now we have a business development network team that does agency work for us, but we still travel a lot. I’m going to north Lincolnshire tonight, Nottingham tomorrow and I’m in London and Birmingham a lot, so it’s still very hands on.”
To date, IAM Sold works with 1,300 agencies across the UK and more than 10,000 homes have been sold so far.
But ambitious growth plans have seen the founders set new goals for the next three years, to take turnover past the £25m mark, grow headcount to around 150 and to double the number of agencies signed up.
As well as holding ten regional events covering the Midlands, Merseyside, Lancashire, Yorkshire and Lincolnshire, Jamie has a team overseeing online auctions. Part of the growth plans involves reaching into the south too.
And since starting IAM Sold Jamie and Ben have developed separate business streams which employ a further 40 people.
The pair owns the overarching Intelligent Services Group, which is overseen by Ben, comprising a conveyancing business Medway Law, a conveyancing panel management business and a new online business under development called Check My Property and a development company, so it’s all go.
Jamie said: “There are 20,000 agencies in the UK, so we want to double our reach at least.
“We’re market leaders in online auction, under a centralised brand that doesn’t compete with the agencies but seeks to sell their properties.
“And we’re about to move offices too. We need more space, so we’re expanding from 6,000sqft into a 10,000sqft office at Arden House in Gosforth, with an option to go up to 14,000sqft.
“We want it to be great place to work too, so we’re looking at spending around £150,000 on the refit.”
Creating a cool place to work is just one tactic used by Jamie and the team to attract and keep talented staff, and he says retention levels are very high.
Forget fizz Fridays and shopping voucher perks – for the last few years Jamie and Ben have organised huge Christmas parties and taken the entire workforce away on holiday in the summer.
He said: “We’re a service provider, ultimately the service we provide is outsourcing a service to someone, and that’s predominantly auction, therefore the people are the most important part of the business.
“They are part of the family, and we spend more time with them then we do our own families at times.
“Plus it’s about celebrating our success with those who helped us to get to where we are.
“Last year we took everyone away on holiday to Barcelona. We had a long weekend in a really nice hotel, with a rooftop cocktail party on the first day and a beach party with tapas on one of the nights. It was great – all expenses paid.
“The year before we took everyone to Amsterdam, and we’re just deciding upon this summer’s holiday.”
As well as having engaged staff, Jamie believes it’s the broad range of options IAM Sold offers that has helped to drive the growth.
They allow buyers 28 days to exchange contracts and a further 28 days to complete, whereas traditional auction houses would expect such transactions to be completed within two weeks.
This “modern method of auction” could, he hopes, help to transform the property auction sector, and make it a much more mainstream way for people to sell or buy houses.
He said: “Our vision and mission as a business is to try and create the modern method of auction as a viable method of sale for houses.
“One of the biggest pitfalls of this industry is that one is three sales of houses nationally fall through. It’s such a stressful time. Us offering more time means that buyers can access more traditional forms of finance, so they’re willing to pay more.
“Around 40% to 45% of our sales are to owner occupiers, and that just didn’t used to happen. It was one or two percent and it was predominantly investment stock.
“But there is that stigma, that it’s the really run down, fire-damaged houses or ones that might have an anti-social aspect.
“Yet look at fine art. When somebody has a Picasso where do they go? They take it to Sothebys.
“In Australia, north of 80% of all properties are sold at auction. New Zealand is the same and South Africa has high volume too, yet here it’s just 2%.
“When it’s a sellers’ market there are more buyers out there than there is property, why would you not put into environment where you have competitive bidding? I want auctions to become more mainstream.”
Part of the growth plan involves strengthening the boardroom, so senior managers with experience are currently being recruited to help them with the next phase of growth.
They recognise that they can’t learn all the ins and outs of running a business, so need to bring in the specialists to help sustain IAM Sold’s future.
Jamie added: “We need experience in our management team, so we’ve taken on a former Sage sales director who was with them for 20 years and we’ve got a new financial director who was at PwC. It’s about getting in expertise and experience.
“We invest a lot in our people but I haven’t got the full skill set. I can teach people how to do their job but I can’t develop their personal development plans and so on, and that’s an important part of the business.
“We’re recruiting at every level at the moment and we are developing the IAM Sold Academy, so we can revisit all the aspects of our service to ensure that we are at the top of our game and that we will keep people for a long time.”
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