We met up with Nathan Winch, a Leeds based investor, over a morning coffee to discuss his dive into the world of business entrepreneurship and how he got started.
Q: Good morning, Nathan. Tell us about your first investment and how you got started.
A: Basically, my background is in business. My original goal was to be a doctor, but I wasn’t smart enough, so I ended up studying molecular biology. In my sandwich year, I was working for the NHS, and I was doing a lot buying for the department and for the NHS and realised that they were paying a fortune for everything. So I thought maybe there was a way to sell to the NHS and be a bit more competitive, as it was dominated by lots of big businesses, which is what was driving the price up. So I set up a business, big on a contract and won a share of a huge £39 million contract.
Q: So, how were you ready to take on such a massive commitment at such a young age?
A: I didn’t have any money, didn’t have any experience, didn’t have anything at all. So I was scrambling around to find investors and people that knew what they were talking about because I’d blagged it completely. We got WinchPharma up and running, doing NHS supplies doing cleaning supplies, medical devices. It did really well, and we ended up selling that business to a supplier in 2017 for a profit.
Q: So you were 21 when you set up WinchPharma. Other 21-year-olds are out partying and having fun. At what point did you realise you were a little different?
A: Well, I still did all that, still do! But it was way before that, back at school. I was the kid selling sweets. I started my high schools first student-run newspaper. I think those were the early sparks, and I relaxed into this idea of making stuff happen and making things happen. From then on, it kind of built into an entrepreneurial flair. And the more I did, the more I realised it was what I wanted to do.
Q: So returning to the NHS contract, when you won that contract, it was in the papers. What was that like?
A: When I won that contract, it was a big deal. Up until then, small businesses didn’t have a place supplying the NHS. At that time, we were the smallest business to win a contract with the NHS, as far as I know.
Q: There must have been a lot of red tape?
A: There was. I needed to get support. I knew what the processes and prices were, but in terms of accreditations, certifications that you’ve got to have, I had to find people that would happily work with me for free to help me with all that. So that’s what I did, really.
Q: How did you incentivise people to do that?
A: Networking. They came into the business and became part of it. I literally had nothing, and we won this contract which seemed very promising. I got these guys on board to help me. I think it was because I was so young at the time; they wanted to help me succeed.
Q: How did that experience help you in your later ventures?
A: There were so many lessons learned. I have multiple businesses now, but my core business is Winch & Co. I run a private equity firm. All we do as our day job is invest to make a return. We buy, hold and sell businesses. We learned the importance of connecting the right investors and professionals to the right industries to ensure that investors are satisfied with the speed of the returns and the professionals are able to streamline and improve efficiency in the businesses we place them in.
Q: Do you keep the majority of the businesses that you acquire?
A: Our highest returns come from businesses that we buy to do something with. Whether that’s consolidating them, turning them around, or buying profitable businesses to hold. We currently hold 22 businesses and over 100 employees.
Q: How do you choose which businesses would work well for you?
A: I’ve got a fantastic team at Winch & Co, who are all amazing at doing their thing. We have relationships with other investment firms that send us leads. We look for motivated sellers, people that want to retire, and so on. And if they fit our investment mandate, we make an offer.
Q: Final question, how do you decide which staff to keep when you acquire a business and which businesses to keep?
A: When you buy a business, you inherit the staff. You have to be considerate of the people that are employed in the business. There is a responsibility to it – they’ve got mortgages to pay, kids to feed. I’ve got a team behind me that know what they are doing. I’ve got great sales consultants, managers, and so on, so we can go in, do what we need to do. We add value, and then we either move it on or keep it for cash flow. It’s almost exactly like property investment, only you’ve got an extra dynamic of there being a lot of moving parts in a business.
Our thanks to Nathan Winch for taking the time to talk to us and sharing his words of wisdom.