“If entrepreneurship is a choice, you probably shouldn’t do it.” For George Bevis, frustrated in banking, with a clear idea of the problem that needed be solved and the way to solve it, it was a no brainer.
“I don’t think anyone ever regrets leaving banking. Entrepreneurship is a vocation. I don’t take the view that it was a choice — I was driven to distraction in a big bank and I knew working on my own was the only way I could lead a happy life.”
Having worked as a banker and as a small business owner, George Bevis had seen first-hand the poor quality of business banking but also the vast administrative burden on businesses. Business banking tended to be an afterthought for the larger high street banks, which make their money on consumer or investment banking. Business banking simply didn’t hold their attention and this was reflected in a poor service to customers, where set-up could take weeks, access to credit was poor and the product was essentially the same as a consumer account, but with extra fees.
George says there was also a ‘cultural madness’ that assumed that what entrepreneurs really wanted was time with staff in the banks, people they could go in and talk to. He knew from experience that the last thing most entrepreneurs wanted to do was talk to people. They are phenomenally busy running their businesses and had no time to chat.
The right answer
For him, it was clear the way business banking should operate — “there was only one right answer”. At the same time, the technology was straightforward as well: “Tide ensured that people could set up an account quickly on their mobile, pay per transaction, ensure that most of the things a small business does are automated and that the owners never have to speak to anyone.
The admin problem was a little different. They made it easier to do book-keeping, creating useful tools such as a team expenses card. They automated payments and ensured that the system worked seamlessly with various accounting systems. Invoices could be uploaded, for example. “We built a whole raft of tools designed to give small business owners their time back.”
However, it was expensive to build a regulated banking business. George says: “Trying to convince people that this project had a chance and to put up the capital was difficult. It was a full year before we raised the £1million we needed to get started. This came from a couple of small investors putting up £135,000 — £150,000 and then we finally pulled in some larger amounts from venture capital funds.”
Swift take up
This was in spite of near-immediate take-up for the group’s services. The founders were clear who Tide needed to target initially: “We wanted white collar technology businesses in and around London — people who looked a little like us. We figured that we understood them and could get to them reasonably easily through our network. We had good connections in the sector and could get the word out.” This went as far as taking over a pop-up store in Old Street, the centre of London’s ‘tech roundabout’: “It proved a good way to get noticed” says George.
Even with this strong pipeline of clients, a sound proposition and well-established technology, it wasn’t easy to raise financing. George admits that it was only when they had a £10 million cash injection in the summer of 2017 that they felt they had the capital to run Tide as they wished to run it.
This last capital round established Tide as a ‘proper corporate’, says George. It is now nearly 200 people, with 80,000 small businesses signed up and is a different sort of entity. For him, it was the moment to exit. His passion was for early stage businesses and Tide now needed an experienced corporate management team to take it forward and scale it up internationally.
He now works on a range of new start-up ideas, including some not-for-profit options. Mostly, they are not in fintech, but he still believes there are opportunities in emerging markets: “There is still a need for someone to sort out fintech in the developing world, particularly in Africa. In Western Europe, most of the important problems have been solved by innovation over the past 10 years and there aren’t the big ideas for fintech that others haven’t had. However, the opportunities in the emerging world are significant.”
By necessity, this briefing can only provide a short overview and it is essential to seek professional advice before applying the contents of this article. This briefing does not constitute advice nor a recommendation relating to the acquisition or disposal of investments. No responsibility can be taken for any loss arising from action taken or refrained from on the basis of this publication. Details correct at time of writing.
This article was previously published on Smith & Williamson prior to the launch of Evelyn Partners.