Nicki Boyd, Partner at private equity firm Apiary Capital, talks to Rachel Bridge at Drax about how she is bringing her experience of creating a Silicon Valley start-up to her new role
When Nicki Boyd meets ambitious entrepreneurs looking for growth and investment for their businesses, she does not have to guess how they might be thinking; she already knows. That’s because as well as having extensive experience as a private equity investor, Nicki also co-founded an ambitious Silicon Valley start-up herself and so knows exactly what it is like to be sitting on the other side of the desk.
Nicki started out as a strategy consultant but quickly realised that she would much prefer to work in private equity, starting at NBGI in 2005 before joining Inflexion in 2007, where she worked on several key deals. After seven years there, Nicki took a sabbatical to do a Masters Programme at Stanford University in California. She only intended to be away for a year but instead she found herself starting a business there.
She says: “Silicon Valley is quite an intoxicating place and Stanford is the epicentre of that. Everyone is either changing the world or believes they will in the future. Most people are doing something entrepreneurial and that led me to step back from investing for a while and get some hands-on operational experience.”
Together with two classmates she started a technology business called VersaMe which focused on maximising early childhood development, particularly the importance of language. Nicki raised venture capital, drove the business and launched the first product - a language measurement tool - to market. They achieved early revenue growth, but not at the exponential rate desired, so took advantage of an early exit opportunity in 2017.
With a plan to get back to investing, Nicki received a call from Mark Salter who she had known from her private equity days in London. He asked if she would like to be a co-founder of Apiary Capital, a lower mid-market private equity firm he was starting up. She jumped at the chance and headed back to the UK to complete the firm’s founding team of four.
Apiary will invest in firms with between £2 and £5 million EBITDA in the areas of business and technology services, education and healthcare. They plan to help them grow through a buy and build strategy to £10 million plus EBITDA. So far Apiary has made three investments: TAG, a travel management business; Bertram, a children’s nursery chain; and G3 Comms, a unified communications provider. The firm hopes to do two to four platform deals a year.
Nicki says: “We are business model investors, looking for service businesses with sticky customers and therefore high levels of revenue visibility, which gives downside protection and security. At the size that we operate, we are generally buying from owner managers who know their sectors very well, but may not have fully optimised their business in finance, technology and data capture, for example.
In our most recent deal, G3 Comms, the majority of the team have been in technology services businesses their entire career and are authentic, driven and motivated. We will be supporting them through this transitional phase and helping prepare the business for an accelerated buy and build programme. These are exciting periods in a company’s evolution.”
She says that while there is strong competition for investments at the higher end of the market, in the lower mid market space, where they are, there are still lots of deals to be done. She says: “It is harder work; you are rolling up your sleeves and buying from founder owners so things aren’t beautifully presented, but that is how you create the value.”
Apiary hopes to entice businesses with the high level of knowledge they bring to a deal, and with the personal touch they can add. Nicki says: “The other thing that makes us different is that businesses will be dealing directly with the decision makers - when Mark and I are both at a meeting most of the investment committee are present. We are not two steps removed. That gives entrepreneurs a lot of confidence and certainty.”
She feels that her experience as an entrepreneur will also prove useful. She says: “I think I am able to be a much better investor having lived and breathed as an entrepreneur myself. The tendency is for us private equity folk to be very data hungry but having sat on the other side of the desk with investors clicking their fingers at me, I will definitely have more understanding about what I ask of a company at a particular stage.”
Drax sector lead: Ruby Sheera
Partner, Technology and Tech-enabled businesses
Tel: 0203 949 9555