Why you should stick to the formula that works

 
Annabel Denham
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Annabel Palmer talks technology, investment, and skiing with Six Degrees founder Alastair Mills

THE men of the Mills family have historically been coalminers. So it is safe to say that Alastair Mills, founder of the Six Degrees Group and the first of his relatives to go to university, has broken the mould.

IT companies have been bucking the trend in showing high levels of growth despite a tough economic climate. Six Degrees Group, the data connectivity and cloud computing business, is one such success story. After two years, it has already acquired 12 other companies, without making a single redundancy. Its growth has been so rapid that Mills often has to remind himself that the company isn’t yet two years old, and reign in his overambitious plans for the immediate future.

Mills’s career took a turn towards IT when he accepted a job at Telewest in 2001. One of its suppliers was the failing Spiritel. The company, formerly privately owned, had been floated into an Aim shell – with disastrous consequences. And Mills was taken on by the company’s financial backers, Penta Capital, as chief executive. At 32, and one of the youngest chief executives on Aim, Mills confesses he felt “completely out of my depth”. But he left the company in a far better condition than when he joined – it was sold to its rival Daisy for £38m in 2010.

Subsequent gardening leave was spent researching the IT market and formulating a business plan. With data centre business 2e2 recently going into administration, he is glad he shunned the traditional “legacy” side of IT. But he informs me the decision to enter cloud computing was simple. “You don’t look at the book business and decide to copy the Waterstones business model. You copy Amazon. And that’s exactly what we did but for IT.”

At the same time, he approached his former management team from Spiritel and asked them to join his new venture. All six agreed. He now has the same team, bank (Clydesdale) and private equity backers as he did at Spiritel. And with Six Degrees expecting to make £14m to £15m profit in 2013, as well as naming half of the top ten legal firms and half of the top ten global banks among its customers, it seems that sticking to the old formula worked. “My motto has always been to employ people better than I am. I’m academically mediocre, did a straightforward degree, and I’m not a particularly strong technologist. So I’ve spent the past seven years doing exactly that.”

Six Degrees is no industry behemoth, but it’s managing to compete with the likes of BT, and it has lofty ambitions. But far from being the group of risk-takers they are perceived to be by the industry, Mills assures me his team are a “conservative bunch”. As such, no acquisition they’ve made has had the capacity to jeopardise the company.

Mills has always had an entrepreneurial streak. At university, he created a business from going to police auctions, purchasing stolen bikes, and selling them on to other students. But the ease with which he initially navigated the buying and selling game filled him with a false confidence. When he attempted to set up a ski holiday company after leaving university, it “failed miserably”, and his father – who was “not a wealthy man” – had to bail him out. It’s a shame his success has failed to extend to the slopes. Mills may have “the best job in the world,” but it’s clear his true passion is skiing.

Nonetheless, when he approached Penta Capital, it was investment in an IT company he was seeking. “When private equity firms and banks are looking to invest, they want to know your track record and whether you’ve had success in an associated business. It’s safe to say I might have struggled to raise £75m for another ski company.”

The success of his business, and the ease with which he obtained funding, means Mills is confident Britain is open for business. “There is money out there to be invested in the right areas. If you can turn profit into cash, and can demonstrate growth, you can get investment.”

CV ALASTAIR MILLS
Company name: Six Degrees Group

Founded: June 2011

Company turnover: £60m

Number of staff: 210

Job title: Chief executive

Age: 40

Born: Lancaster

Lives: Wimbledon

Studied: Public Policy at Nottingham Trent

Drinking: Argentinian Malbec with steak

Eating: Steak with Argentinian Malbec

Reading: History of Burnley Football Club

Favourite business book: Boo Hoo: A Dot Com Story, by Ernst Malmsten, Erik Portanger and Charles Drazin

Talents: The ability to hire staff more talented than I am

Motto: “Don’t be afraid to employ people who are better than yourself ” or “employ attitude, train skills

First ambition: To be a professional skier, or a missionary