Behind the Business: FreeAgent

Q: What inspired you to start your business?

FreeAgent really evolved from an idea that my fellow co-founders Ed Molyneux, Olly Headey and I had back when we were working as freelancers and IT consultants. All three of us really enjoyed working for ourselves, but we didn’t like the financial admin that came with it - especially as, back then, there weren’t any software options that were specifically-designed for smaller businesses like ours. You either had to try and grapple with one of the big, complex desktop packages or manage your books with fiddly spreadsheets.

We also recognised that we probably weren’t alone: there were many other businesses like ours in the UK that were likely to be in desperate need of a software solution that’s designed for their needs. So, rather than wait for someone to develop and release such a software, we decided to make it ourselves.

Q: What was the very first step you took?

When I first met Ed in late 2006 he had already developed a simple prototype of how FreeAgent might work. We started working on refining his software from a user experience point of view and taking it out to some early beta testers to get their feedback and see if it was the kind of thing that they required in their businesses - and, more importantly, that they would pay to use.

We worked closely with these beta testers over the course of a few months in order to get to the point where we were ready to launch the product publicly.

Q: Did you have a clear plan, or did things evolve as you went?

We knew from a fairly early point that we were tapping into a real market need. A lot of the initial feedback we had from our first users was very positive and that helped us recognise that FreeAgent could be a viable full-time business rather than a side hustle.

Our journey has been a bit of a rollercoaster, to be honest. Although there was always a vision of what FreeAgent could be, we’ve had to adapt to changing market conditions and meet new opportunities when they’ve arisen. Whether deciding what funds to raise, which new features to build or what new markets to focus on, we’ve been constantly evolving the business over the past 18 years.

Q: What’s been your biggest challenge so far?

Certainly one of the biggest challenges I’ve found has been trying to keep the company customer-centric as it scales. Since we launched FreeAgent in 2007, we’ve grown from a three-founder startup working with a handful of customers and developing software around a kitchen table to an established 280-employee-strong business with more than 200,000 customers. And that means that there are more moving parts than ever to try and stay on top of.

When your business is small, almost everyone is customer facing to some extent, but as it scales it’s easy for some teams to become more isolated from the customer who is ultimately using the product, and there’s a risk you end up losing sight of the mission of the business.

Recognising that as a challenge - and then embedding a customer-centric culture and viewpoint early on - is so important.

Q: What’s one thing you wish you’d known before starting?

It’s often said that “you don’t know what you don’t know”, and the only way to remedy that is to either learn on the job as things come up or hire people who have been there and have experience that you can draw upon. Both are important, but it takes time to realise this!

We hired a strong senior team early on, who were knowledgeable in some of the areas the founders were weaker in (sales and marketing for example) while at the same time learning as we went. I think we probably still tried to do too much ourselves in the early days, so it’s really important to learn how to delegate properly and trust your employees to do what you’ve hired them to do.

Q: Who supported you most in the early days?

The credit cards certainly took a bit of a beating in the very early days when it was just us three founders working on everything and supporting each other! However, I’d say that our first ‘big’ supporter was an angel investor called Christoph Janz. He saw the potential in what we were doing and gave us our first major piece of investment, which helped us scale up the business for the first time. Having that kind of recognition from a respected and successful business investor was massive for us.

Q: How do you define success for your business?

Our vision is to make small businesses happy and more successful by putting them in control of their finances. So everything that helps us achieve that aim is a success.

Obviously we set ourselves challenging Objectives and Key Results (OKR) targets, and we strive hard to achieve them. We constantly challenge ourselves to go above and beyond for our customers - whether they’re small business owners or the accountants who work with them. But everything goes back to our core purpose: ensuring that we offer the best possible software solution for every small business - whether they are the smallest side hustle or the fast-growing, ambitious SME.

Q: What’s been your proudest moment so far?

There have been so many, it’s difficult to just choose one!

I guess my proudest moments have tended to be the things that had the biggest impact on the business - which would include securing our first major angel investment; moving into the first ‘proper’ office that we designed ourselves; successfully raising £1m through equity crowdfunding; and completing a successful IPO by floating on AIM.

It was also a really significant moment when we started working with the NatWest Group - first, as their chosen software partner for small business banking, and then later when we were acquired by them in 2018. That really solidified our status as a major player in the market.

Q: What advice would you give to someone thinking of starting their own business?

Surround yourself with a strong support network. That could either be your founders, senior leaders, mentors or just a community and network of other founders also running businesses.

You simply can’t do everything yourself - no matter how motivated or committed you are. Don’t underestimate the importance of drawing on other people’s advice and expertise to help you get through the niggly problems, or even just to offer moral support when times get tough.

Q: If you could go back and do one thing differently, what would it be?

I’d probably be more aggressive when it comes to investment and growth of the business. FreeAgent was the first real business any of the founders had ever run before, we really didn’t know what our journey would look like and there were times when we were probably a bit more conservative than we needed to be.

In hindsight, I think we could potentially have accelerated even faster than we did - or been a bit bolder with some of our decisions.

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