Scaling a global business from the North East
July 4, 2023
The North East is home to a thriving community of business, innovation and success stories to be proud of. One of those is Steve Rawlingson, founder of Samuel Knight. And having scaled his multi-million-pound global business from the North East, the award-winning entrepreneur now has his sights set on helping others do the same.
I founded my business Samuel Knight from a single-person office in Newcastle in 2004.
My vision was to build a specialist recruitment company offering solutions in renewable energy and sustainable transportation.
Fast forward to 2023, and Samuel Knight is an eight-figure business.
We operate across 48 countries, with offices throughout the UK, US and the Middle East, and employ more than 100 consultants.
From Newcastle, I scaled a business to become a global success.
The North East is such a great place to do business that my mission has now evolved to help others do the same.
Why grow North?
Launching Samuel Knight in the North East was a conscious choice.
It’s a misconception that to grow a large business, you must do it from London.
As a single, full-time dad, I was settled in the North East with my two children, and already knew the benefits I would see from growing my business here.
Firstly, I had an amazing network in the North, from connections I’d made in the recruitment industry to people who had mentored me, and who could advise me on the mechanics of growing a business.
Secondly, there’s an abundance of talent in the North East; employees are loyal and retention is strong.
At Samuel Knight, we’ve had several brilliant graduates from Newcastle and Northumbria universities, who’ve honed their skills and built rewarding careers.
And finally, the associated costs of growing a business are significantly lower in the North compared to the South.
Our 12,000sq ft office in Newcastle costs around 75 per cent less than our office in London, which is considerably smaller.
Local values, global vision
When founding Samuel Knight, my plan was to build a company I knew could make a difference to the industries we work with, a company people would feel proud to work for.
This ethos has underpinned our growth at every stage.
The catalyst for Samuel Knight to achieve exponential growth was our determination in trading internationally.
Right from the start, I used existing connections and formed new ones, built on my expertise in the recruitment industry and sold our solutions with passion.
Trading internationally delivered bigger margins for us than the average business in the North East, which fuelled our growth.
In our first year, we had four staff, working from a tiny office in Newcastle.
By year three, we had 20 staff and were generating £10 million in sales.
As we established our processes and market position, economy of scale kicked in.
We knew what worked and we’d carved out a niche, using innovative solutions and building an impressive list of companies we worked with.
When we reached year four, our revenue was £18 million with 50 employees and offices in Newcastle, Bristol and London.
In year five, I knew we had something special.
I recognised the potential to go even bigger, knowing that with the right finance partners, our scale-up journey would reach the next level.
At the time, though, I knew nothing about institutional investment, so I set out to learn everything I could.
By the end of year five, we’d partnered with a growth equity investor and raised just under £6 million working capital to scale the business.
The finance allowed us to invest in new technologies, recruit more staff and ultimately launch in the US, where we had identified a huge market for our niche of engineering and technology recruitment solutions.
Within seven months of launch, we generated $10.7 million from the US market.
Now, the Samuel Knight group consists of Samuel Knight Technology, Samuel Knight Energy, Samuel Knight Rail and Samuel Knight Projects.
We have a little more than 100 staff, offices in cities across the world and are an eight-figure business.
We’ve invested in staff and have committed to growing our team to 170 people by this time next year.
Five factors to scale
Ten years ago, sitting in that small office in Newcastle, my business was just an equally small idea.
Now, it’s massive.
Each business needs its own magic formula to scale.
From my experiences, here are the five factors that should form part of it:
• Risks lead to rewards
Taking risks doesn’t mean being reckless. Evaluate your situation. Know which risks you’re prepared to take and disregard the ones that won’t deliver rewards
• Establish solid foundations
When you found a business, you have to get up and go, you have to make things work. But to scale, it’s essential you have solid foundations across operations, finance and sales. This will facilitate sustainable growth and minimise risk to your business
• Don’t be afraid of debt or raising equity
Investment propels your business to the next level. Sure, you can grow organically, but this is a slower process. Getting the right financial levers in place between debt and equity gives you the power to scale at a much faster pace and deepen your impact
• People and values are everything
Hire good people (and don’t shy away from hiring people better than you). When you have a team of people who believe in your vision, mission and values, they’ll all be striving for growth with you
• Carve out your niche
It’s crucial to define your niche. Having a niche allows you to penetrate a core market and showcase yourself as a subject matter expert. Then, understand the buying habits of your audience and target them directly, building a marketing strategy that differentiates you. To grow a business, being outstanding at one thing is so much more effective than being OK at lots of things
After learning these lessons while scaling my own business, my priority now is to give back through mentoring, speaking and investing.
The North East is full of brilliant people and brilliant businesses – let’s continue to champion scale-up journeys.