BRW Fast 100: the top 10

Speed is an outcome rather than a means to get to the top of the 2012 BRW Fast 100, whose shooting stars all set out with a brilliant idea, then found the courage, strategies and people they needed to outshine the competition. These are the top ten companies.

TIME TELECOM

• Rank: 1
• Turnover 2011-12: $51.1 million
• Growth*: 375.21 per cent
• Founded: 2005
• Employees: 86
• Chief executive: Sachin Rathi
• * Average annual growth in three years to 2011-12

The reign of Time Telecom at the top of the BRW Fast 100 will be short-lived. Sachin Rathi has already sold his customers and contracts and turned his attention to another venture.

The fixed and mobile phone line reseller was originally a small client of Rathi’s, who with his brother Narayan was running a call centre business Source Professionals, doing telesales for telco companies. When he bought Time Telecom for $25,000 in October 2008, it had just 200 clients. In 2009, Rathi applied Source Professionals’ 150-strong call centre workforce in Melbourne and India to an aggressive customer acquisition strategy. By the end of the 2009-10 financial year, the business had grown to revenue of $16.8 million.

When Time Telecom’s wholesaler, former Fast 100 company M2 Telecommunications, made an approach to buy the company, Rathi had another idea. “We never wanted to sell the recipe of the business, which is the people, the sales techniques, the telesales and the marketing,” he says. “We were happy to sell the customer base because we knew that building up customers, [is] not that difficult because we’ve done it before.”

In March, M2 paid $18.35 million for 30,000 Time Telecom customers. The asset sale contributed to the company’s $51.1 million revenue in the 2011-12 financial year. As part of the deal, M2 has signed on to be the exclusive wholesaler for Rathi’s next telco reseller business, Smart Business Telecom. And Rathi has promised not to poach his former customers.

If he can land Smart Business Telecom on a future Fast 100 list, Rathi, who arrived from India in 2002 to study business and technology at Monash University, will have shown he has mastered the right recipe for starting a business.

SCO RECRUITMENT

• Rank: 2
• Turnover 2011-12: $14.4 million
• Growth*: 266.36 per cent
• Founded: 2009
• Employees: 18
• Chief executive: Larissa Robertson

The global financial crisis sent a non-profit recruitment and property maintenance business into liquidation. Former accountant Larissa Robertson bought the assets and established SCO Recruitment as a profit-making business, with non-profit Trim and Proper operating alongside.

Have you ever suffered a big setback? Trim and Proper employs long-term unemployed in our large-scale contract mowing and cleaning business. Initially we lost a $4 million client before we even started trading and had invested more than a couple of hundred thousand dollars in equipment for that contract.

How did the business recover? The first thing I had to do was work out what level of business we had and what level of debt we had to maintain. It was days worth of juggling the numbers. We were locked into a lot of hire purchase agreements. We had to sell as much of the additional equipment that we could but still make sure we could get a good price for it. I had to reduce some of the staff. And I stopped paying wages to the other partners that I had originally, which is one of the reasons they stopped being partners. I cut my own wages in half. There wasn’t really much we could do [in terms of increasing revenue] because most of the work through Trim and Proper is through tenders. We had to make do with what we had.

How do you handle the mental demands of running your business? When things get really stressful, I find the best thing is to take some time out and really indulge in a massage or facial or sleep in. When things really hit the fan maybe all three. Then after I am relaxed, I sit down and work through the problem till I have a solution. Hopefully I will train myself into reacting to stressful situations with joy and excitement by always having that indulgence to look forward to.

LASER CLINICS AUSTRALIA

• Rank: 3
• Turnover 2011-12: $20.1 million
• Growth*: 246.68 per cent
• Founded: 2008
• Employees: 150
• Managing director: Alistair Champion

When Alistair Champion left an IT role at a law firm for the business of beauty, he joined a chain of salons, Avana Cosmetic & Laser Clinics.

“I saw it was a brilliant space but probably poorly executed.” With Avana’s founder, Babak Moini (who has another business on the Fast 100, Skinstitut, ranked 22nd), Champion re-imagined the business as Laser Clinics Australia.

Champion has learnt more about hair removal than he expected but says he could just as easily be “selling widgets”. “It doesn’t really matter what it is that you’re doing, it’s the business process that you apply to it,” he says.

“As the IT manager [at Avana] I had a jail warden equivalent set of keys. Every single retail location had a different key. We went and pitched to locksmiths to say we want a keying system with a hierarchical structure. Now I have one key.”

In your experience, was there an economic downturn? Yes, during this period we expanded our retail locations substantially.

The high retail vacancy rates and lease abandonments allowed us to negotiate some favourable retail tenancy terms.

Do you have any unique recruitment strategies? We are building a Registered Training Organisation under a separate but associated entity, which will offer government accredited training courses in all of our services. Aside from bringing a substantial amount of authority to the LCA brand, we intend to use this as a recruitment pool by offering positions in our clinics for successful candidates.

Have you ever felt your business is adversely affecting your physical health or personal life? Now that my wife works in the business, we have had to make a concerted effort to have strict “no business talk” times in our day where we sit and have civilised conversations about anything other than business.

ZEN ENERGY SYSTEMS

• Rank: 4
• Turnover 2011-12: $77.3 million
• Growth*: 228.76 per cent
• Founded: 2004
• Employees: 65
• Chief executive: Richard Turner

In its earliest iteration, ZEN Energy Systems was a research and development company looking into sustainable energy generation. But Richard Turner, who is on to his fourth business (the other three were in food distribution, hospitality staffing and a promotional modelling agency), decided he would get into marketing in the solar industry.

“It dawned on me that this was a technology that people are going to want to power their homes in the future but there was no system and no brand in the marketplace,” he says of his 2006 epiphany.

“Putting my marketing cap on, I thought, this is an opportunity to build the first renewable technology brand in the country.”

ZEN components are manufactured in Germany and China and assembled in Australia. The company has recently partnered US outfit Greensmith Energy Management Systems (which owns a stake in ZEN) to develop energy storage technology. “The thing that . . . has stopped us from becoming what I call a true energy company . . . is [solar] can’t provide baseload power. To be able to provide baseload power, we need energy storage.”

What has underpinned your revenue growth? I think we’ve built a very strong brand. Everyone else just sells the bits and pieces
. . . but it’s only as good as the weakest component. We’ve built a system where every component is of high quality.

What have you done to accelerate that? We’ve focused on public relations. It’s better to have other people talking about you than you talking about yourself. And other solar companies virtually have no technical support department. We have about 12 people in that division. We will virtually have a full-time business soon, fixing up other people’s problems.

JETTS FITNESS

• Rank: 5
• Turnover 2011-12: $66.2 million
• Growth*: 212.59 per cent
• Founded: 2007
• Employees: 29
• Founder: Brendon Levenson

The 24-hour, low-cost gym franchise sprints into the top 10 of the BRW Fast 100 for the second year in a row. But founder Brendon Levenson is already applying strategies to ensure the business doesn’t burn out. Adrian McFedries, formerly of franchise consultancy DC Strategy, joined the chain as a director two years ago and became managing director one year ago.

“Bringing in an experienced MD has helped solidify the business as it shifts from fast growth to long-term sustainability,” Levenson says. “Personally, it has allowed me to get back to what I love best – thinking of ways to innovate within the business and enhance the customer experience.”

Has your business been affected by the higher Australian dollar? Yes, it has resulted in lower prices for our equipment [which makes up] about 45 per cent of our total business setup cost.

What are the most important trends emerging in business this year? The use of mobile devices for web browsing and online purchases.

Is your company taking advantage of the growth of the economies in China or India? No, the opportunity will still be there in five years, so we are cutting our teeth in other markets first before developing an entry strategy.

Have you ever felt your business is adversely affecting your physical health or personal life? Not so now, however in the early start-up days it takes over your life. That is the nature of a start-up, particularly a fast-growing company.

How did you deal with the pressure? Playing competitive sport gave me a focus outside of the business (Levenson was a keen surf lifesaver, winning a national beach sprint title in 2007 but has since slowed down due to injury). Competitive sport gives you no choice but to focus entirely on the present moment.

TRIDANT

• Rank: 6
• Turnover 2011-12: $10.0 million
• Growth*: 185.65 per cent
• Founded: 2007
• Employees: 46
• Chief executives: Alec Jeffery and Nimrod Kuti

Alec Jeffery left his role as general manager of a consulting firm in Melbourne to team up with Nimrod Kuti – a consultant he had hired 18 months earlier – to go into business. It was a first for both of them but Jeffery says he was keen to get out of corporate life and it also suited Kuti, whom he describes as “not a big company man . . . he’s a high value, clever, creative type”. Within a month, the pair had opened Tridant, a consulting firm specialising in the implementation of a type of IBM business intelligence and performance management software.

Would you like the business to grow faster? Jeffery: No, our growth rate since inception has been appropriately high to get to a point of scale that allows us to compete effectively. We are planning for a growth rate of about 50 per cent this year and 35 per cent the following. In a start-up it’s all frantic, you’re more responsive and you’re not proactive. As you mature as a business, you get to that stage of being more predictive. We’ve grown fast and we need to take a bit of a breath.

In hindsight, how would you have handled running your business differently? Jeffery: While we were busy growing the business in the right areas, [we had] some areas that were underperforming [and poor] utilisation of staff. When you’ve got “bench time”, people are not being billable. That was one of the metrics we started to monitor carefully. We weren’t aware of how much we were getting out of our consulting team as a whole. Once we could measure it then we could actually act on it. If you’re selling performance management solutions, you should be analysing internally, too.

LSA RECRUITMENT GROUP

• Rank: 7
• Turnover 2011-12: $34.5 million
• Growth*: 172.82 per cent
• Founded: 2004
• Employees: 55
• Chief executive: Andrew Northcott

LSA Recruitment Group is its own two-speed economy. The group’s “white collar” business, LSA Recruitment, is being outpaced by the “blue collar” Labour Solutions Australia, which runs casual workforces in the agribusiness, construction, transport and mining sectors.

“There is a lot of uncertainty [among these clients],” founder Andrew Northcott says. “[By employing casuals] they can gear up for projects without burdening themselves with the risks of a full-time workforce.” This is the company’s third consecutive appearance in the top 10 of the BRW Fast 100.

How much longer can you stay growing at this rate? We need a bit of a break I think (laughs). But to be honest, it’s actually easier today than it was four years ago. The business has got to a point or a scale that has enabled us to have resources now that we couldn’t afford a few years ago. We [now] have people driving and continually improving the business processes and that's enabled me to focus on strategy.

What are your main strategies for attracting and retaining customers? We measure and remunerate our staff based on our clients’ opinion of how well we perform. We have an independent person who contacts our clients and asks them to rate our performance and that’s done each month and it gives us a really strong indication of how we’re doing. We ask how we can improve our business and provide more value. That’s important because if we can provide more value to our customers that’s certainly going to benefit them but will also certainly help to build our business.

Have you ever felt your business is adversely affecting your health or personal life? No, as a business owner you choose the lifestyle and, like everyone, are working towards a goal. There are challenges and what some might call sacrifices but if you love what you are doing, it is all worthwhile. Physical health is an important one to manage and difficult when travelling a lot.

BIOPAK

• Rank: 8
• Turnover 2011-12: $11.2 million
• Growth*: 171.99 per cent
• Founded: 2008
• Employees: 10
• Co-directors: Gary Smith and Richard Fine

Richard Fine got the idea to supply plant-based packaging from a story in his local newspaper in 2006. Waverley Council in Sydney had banned polystyrene but a juice shop had been busted and was fined $100,000. “I thought there’s got to be a way to produce a cup with similar functionality that is more sustainable,” he says.

Fine, who has a background in plastic manufacturing, met Gary Smith, who had previously built and listed an accounting software business. The South African pair hit it off and got to work on BioPak.

In hindsight, how would you have handled running your business differently? Smith: Our original product choices cost us hundreds of thousands of dollars. I remember in 2008 bringing in bucket loads of raw materials to give to manufacturers for them to trial. They were quite excited but no one ever adopted the idea. We’d put up about $100,000 up to mid-2008 into trying to convince local manufacturers.

There was a demand but they didn’t see it. They thought no one was going to pay 10 per cent more [for packaging].

What was the solution? Smith: We have four [manufacturing] partners, based in China and Taiwan. When we started, we were manufacturing “pallets” of product, today we’re doing 30-40 containers of product a month.

Do you have a succession plan? Smith: No we do not, but I would love my children to one day take over. A lot of people build businesses to sell, to go lie on the beach. I’ve [lain] on the beach. My experience has taught me that you have to have a purpose every single day and love what you do and we love this business. It will be selling my soul [to sell]. Our succession plan is, I’ll die in my chair and my kids will take over.

NUTRITION WAREHOUSE

• Rank: 9
• Turnover 2011-12: $10.4 million
• Growth*: 152.19 per cent
• Founded: 2008
• Employees: 26
• Chief executive: Grant Mayo

Former bodybuilder Grant Mayo, who won Mr World in 1997, co-founded retail business Australian Sports Nutrition selling protein supplements in 2002. But Mayo reckoned that business model was flawed, going after outlets with “polished floorboards” and “shiny shelves”, so he went out on his own to establish competitor Nutrition Warehouse. After opening his first store in Underwood, Brisbane in 2008, the chain has grown to nine stores.

What are the most important trends emerging in business this year? More restrictive lending by banks and more business failures of traditional retail brands such as Darrell Lea. [Darrell Lea’s] main downfall was having all their retail locations in high rent areas. I reckon their rents would have been astronomical.

What has underpinned your growth? Hiring correct staff and having “solution selling”. Say if you want to lose 2 or 3 kilos for your wedding . . . our staff will be able to point you in the right direction to get you the correct supplement. They are all trained and, or, have backgrounds as personal trainers.

What are the main barriers to future growth? Access to appropriate store locations and appropriately qualified, motivated staff. It is tough. We probably would have opened up more stores had we found the right shops.

How can you overcome these barriers? We’re putting together a training facility [for staff] – like a Nutrition Warehouse academy. We’ll train staff on nutrition, supplementation and goal setting. [With regards to store locations] we’re getting real estate agents to source them for us, rather than looking ourselves. We’re getting a bit smarter.

In hindsight, how would you have handled running your business differently? I would have hired staff quicker to manage the business, instead of trying to achieve it myself. In the first two years I was the salesman, the web developer, the marketing guy, the bookkeeper and . . . if I had my chance again, I wouldn’t do that. It probably affected my personal life. Now I’m not hesitant about hiring too many people.

ATTRIBUTE GROUP

• Rank: 10
• Turnover 2011-12: $10.8 million
• Growth*: 151.46 per cent
• Founded: 2008
• Employees: 15
• Chief executives: Andrew Earl and Andrew Tomlinson

Two English-born Andrews – Tomlinson and Earl – arrived in Australia in 1999 and met at a millennium New Year’s Eve party. They both worked at big recruitment firms but in 2008 joined forces to set up their own recruiter and consultancy Attribute Group. The two are considering expanding to Hong Kong in the next 12 to 18 months but will first need to appoint local management.

“We need to think about it very carefully [and] make sure that our business in Australia is at a level where it can manage itself,” Earl says. “Then myself and Andrew can look overseas.”

What are the most important trends emerging in business this year? Earl: We consider technology, relationships and adapting to change to be very important. Being mobile with your website and service is essential. We need to be connected with the millions of mobile phone users around the world, not only through our website but also through blogs and social networking platforms like LinkedIn, Twitter and Facebook. Being a small to medium business you have a greater opportunity to interact with the customer by phone, email and face-to-face. And with regards to adapting, companies of all sizes will need to re-evaluate old business assumptions and adapt to new conditions.

Would you like to grow faster? Earl: I believe the correct answer would be yes and no. Yes, because once you start a business the most satisfying part is seeing your service or product in demand. This growth is exciting and rewarding and enables you to capitalise on your brand.
No, because handling growth, especially at such accelerated levels, has an impact on cash flow, service capability and sense of control.

MORE BRW FAST 100:

• What Australia’s fastest growing companies have in common
• Profiting from vanity in tough times
• Why it pays to start a business with a partner
• The highs and lows of a strong dollar
• BRW Fast 100: the list
• How to make your company go faster
• How to leave your business
• The trick to changing names

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