Profile - Guy Willner

Persistence and networking can pay

by The Chilli analysts

You could read endless articles on what it takes to be an entrepreneur, or even a successful one. But at the end of the day, it's all down to what you do about it, and how you go about it. Guy Willner, ceo of IXEurope, believes that experience, together with the ability to use a network of contacts and a lot of persistence are the characteristics of a true entrepreneur. Here, The Chilli finds out how he did it.

Background

Looking for new opportunities

Funding and the cost of a failed IPO

Values and tough moments

Willner's top tips for entrepreneurs

Next challenge

Guy Willner

Background

Willner graduated from Oxford Polytechnic in engineering. He considered a career in the RAF, but wasn't sure of the long-term prospects, so he moved to Paris and then worked in software development for Philips Consumer Electronics. After working through to product management and sales, he took up a product management position for Minitel around 1987, which involved country-hopping around Europe, obtaining type approval for Minitel in various countries.

At Philips, Willner identified a number of advanced initiatives that were way ahead of the market, including an internet phone in 1990 - which was too expensive - as well as cd-i.

Willner later moved to Vivendi in London to work on telecommunications projects. "I had a French boss who was very cosmopolitan and did not care about my age, status or background," he says "I quickly found myself in a number of senior level meetings just at the point that telecomms was beginning to move in the UK". At one point in his career at Vivendi he teamed together with several cable tv operators to go to the dti and apply for a pcn1800 mobile communications license. The proposal would have used existing cable infrastructure at the back end. Unfortunately, the bid did not succeed.

Continuing at the Vivendi group, Willner moved out to Hungary with his family, to bid to take over a telecommunications network there. He then spent two years raising finance ($210million from the European Bank for Reconstruction and Development) and rolling out the network.

After three years he returned to the UK, and established the business telecomms arm General Telecom for Vivendi's General Cable group, generating a turnover of over £20m within three years - through blue chip clients including British Airways, Safeway and Marks & Spencer. The company, with a staff of 100, was sold to Telewest, which had a strategy biased towards residential customers rather than corporates.

Looking for new opportunities

Willner had spent some time looking for new opportunities. In 1997 an outage in Docklands had been widely reported, and Guy spotted an opportunity to generate revenue from managing IT risk by building of data centres. He therefore left to pursue this opportunity, realising that to be taken seriously he would have to be dedicated to the business full-time.

He hooked up with Christophe de Buchet who had previous experience in startups, especially in operations and finance. Together with an angel investor known to de Buchet, Willner contacted Sir Anthony Cleaver, former chairman of General Cable, and previously head of IBM UK, and was able to raise sufficient seed funding. Both co-founders worked without salary and used the funding to pay for a serviced office and some travel budget.

Funding and the cost of a failed IPO

IXEurope raised a Chilli R1 round in July 1999 of £10m, with an R2 round in September 2000 of £42m.

Around the time of the R2 funding, the company was being pushed towards an ipo (initial public offering). IXEurope was due to float in October 2000, and had completed a roadshow with 68 presentations across Europe and the USA, advised by JP Morgan and Lehman Brothers.

At the time, investors and advisers were pushing the executives to sign long-term agreements on premises for additional datacentres (the ipo plan called for 24 datacentres). The executive team was reluctant in case of a poor ipo. Because the market was high and other data centre companies were looking for additional centres, prices were high. In the end, the company had signed three long-term leases that it had to cancel when the ipo was shelved.

According to Willner, "The failure to float cost us about £6m in lost management time, legal costs, building costs and morale. Just the initial costs to enter a new geography cost £200,000 in basic things like securing and clearing out premises, and so on."

He adds, "The banks and investors had indicated that if the ipo was cancelled, there wouldn't be a problem, as they would pump in cash. They weren't so keen after the failed ipo and I had some work to persuade them to stay in." The company therefore raised a survival R3 round of £12m in May 2001, and went on to raise an R4 round of £7.5m in June 2002, all from its original investors. The company still has this money, and expects to breakeven end of 2003, with eight datacentres. IXEurope expects to launch two or three additional centres next year.

Values and tough moments

Willner is a natural 'networker' who thinks it is 'fantastically important'. He urges entrepreneurs to, "get to know each other, what you could do for one another and then move on." Commenting on ineffectual networking, he says, "It stems from lack of an objective and the inability to complete agreed actions."

He also emphasises the team nature of a business. "Remember, you never do it alone. I spend my time on business development, but Christophe is the worrier, and between us we get things done." Willner adds, "Having a team means that you reflect on a decision, making a company bullet-proof, unlike the approach of a banana republic dictator."

"We still have the same management team we had in 1999, with complementary personalities."

Identifying the toughest moment of his career, Willner says it was, "cancellation of the ipo - everything fell to pieces. We had 70-80 staff, and even though the ipo was shelved due to market conditions, you still feel you have failed. We had to regroup and rebuild morale."

Willner's top tips for entrepreneurs

1. Be networked, or make sure your partner is

2. Get an advisor, and get them to help you for free - they should help you with your plan in a constructive manner and provide solid advice and contacts

3. Get a good finance guy to help you with modelling, cashflow and to determine how much money you need to take you to break-even

4. Don't try to start this while still employed. Make the jump! If you're not fully committed, nobody else will be.

5. Be honest and straightforward - remember you will sign warranties.

6. Someone in the team must have some corporate experience - dealing with senior representatives on the customer side, contracts, protocol, profit/loss, etc.

Next challenge

Having raised around £73m, Willner hopes to do £10-11m revenue this year. Being a small company in a niche market begs the question, "'Do we expand in our niche or broaden our market appeal?"

To address this, Willner hopes to expand in France and Germany, where there are good margins and he has the added benefit of knowing the French market, after having worked there earlier in his career.

Willner has also started running networking events such as 'IXNetworking Happy Hours' with attendance of up to 250, from the domain area of telecoms, IT services, outsourcing and consulting. These events are run in Germany, France, Switzerland and the UK, with the UK events held every two months.

Comments on this story? Send an e-mail to Editor@TheChilli.com

© Chilli Publishing Ltd 2003

10OCT2003