24 Nov 2009 DAILY TELEGRAPH Page 7 (DTC) Edition 1C (1417 words)
Care agency founder needs helping hand
Miriam Warner is looking to leave Miracle Workers to someone who can handle the business and its famous clients, writes Philip Smith CASE STUDY
Philip Smith
MIRIAM Warner never intended to be a business owner. Even when she started her care agency at the age of 55, she only imagined it'd bring in enough to supplement her husband's Army pension. "I thought I'd have 10 clients to bring in about £500 a week," she says.
But 12 years later, Warner is still at the helm of what is now a £1.9m income business and has already rejected one offer to buy her out. "I'm not ready to retire yet," she says. She may not be, but since incorporating Miracle Workers Agency seven years ago, Warner has had one eye on the future. "The business is much more successful than I anticipated," she adds. Net profits are £214,000, up from £90,911 the year before.
It's important, she admits, to get the business to a position where it can carry on without her. "I want to step back a bit," she says. "I put my sons on the board so if anything happened to me they would be able to keep it going."
That's okay for a crisis strategy but it's hardly making the Abergavenny-based company, which offers care and companionship to the UK's independently wealthy and aristocratic elderly, self-sufficient and capable of continuing post-Warner. "I have to look at my exit strategy," she says.
"Originally I was looking to find someone this year to come in as a general manager as my understudy. The plan was to give me more time to be with my husband. But he died in March, which rather pre-empted that! It meant the need to find a replacement wasn't so urgent."
At 67, though, Warner knows she has to start making plans now if she is to leave the business in a sure state of survival once she quits. "A lot of the success of the business is because of my strong personality," she says. "But the secret really is my client base - it reads like who's who. It's confidential, but if I were able to drop a few names we'd get another 100 clients. People would think, 'well, if it's good enough for him...' but we can't do that."
Miracle Workers never set out to cater for such a clientele. "It was a chance phone call. I was rung by a chap who wanted care for his mother over Christmas. I never say no, so just rang round everyone I knew asking if they were looking for a well-paid job over the period.
"Someone said yes but she had two kittens. So I rang the chap back. 'I don't care', he says, 'because she lives at a castle - you can bring a menagerie if you want'. That lady happened to be extremely well connected, as was her son, and word got round. I just fell into offering care for the independently wealthy."
With a staff of 200, including regional assessors and 180 carers, Miracle Workers' services range from short term and specific care to a full live-in service, which costs around £650 a week. "We do the whole gamut now - cooking, cleaning, minding and driving. We give care and companionship. It's seven days, about 10 hours a day," says Warner. The company has 150 clients ranging in age from early 60s to late 90s.
She now has the bit between her teeth. "I would like to treble income," she says. "The business needs to get bigger."
Finding more clients and carers is key, but top of the list is to recruit a general manager who will be tasked with growing the business. "I'd be looking at taking on someone at about £75,000 a year," she says. Eventually they would also be able to take some equity in the debt-free business. "It will allow me to take more time off but I don't want to give up completely. Being on my own, I'd get bored.
"I have no preconceptions about who that person should be - they could be a male in their 30s or a woman in their 40s. The only thing is they can't be as old as me, or that would defeat the point. I want to get it sorted by the end of next year."
What they must have is strong management experience and an understanding of how a business works - including the legal and financial aspects, she says. "They needn't be health trained, I'm not. I can teach them how the business works." Only a few staff members are trained nurses. The Miracle Workers menu of services is aimed more at domestic help than addressing health needs.
Beyond that, Miracle Workers's future is undefined. It could remain as a private family-owned business providing income for Warner's barrister, banker and ITprofessional sons and her five grandchildren or she could sell and reap the rewards now. "I did get an offer for the company last September, but it wasn't enough," she says. "But every woman has her price."
What she's keen to do, though, is avoid a big tax bill if she does sell. "I'd like some advice on how to limit the capital gains tax," she adds.
Miriam Warner is looking to leave Miracle Workers to someone who can handle the business and its famous clients, writes Philip Smith CASE STUDY
Philip Smith
MIRIAM Warner never intended to be a business owner. Even when she started her care agency at the age of 55, she only imagined it'd bring in enough to supplement her husband's Army pension. "I thought I'd have 10 clients to bring in about £500 a week," she says.
But 12 years later, Warner is still at the helm of what is now a £1.9m income business and has already rejected one offer to buy her out. "I'm not ready to retire yet," she says. She may not be, but since incorporating Miracle Workers Agency seven years ago, Warner has had one eye on the future. "The business is much more successful than I anticipated," she adds. Net profits are £214,000, up from £90,911 the year before.
It's important, she admits, to get the business to a position where it can carry on without her. "I want to step back a bit," she says. "I put my sons on the board so if anything happened to me they would be able to keep it going."
That's okay for a crisis strategy but it's hardly making the Abergavenny-based company, which offers care and companionship to the UK's independently wealthy and aristocratic elderly, self-sufficient and capable of continuing post-Warner. "I have to look at my exit strategy," she says.
"Originally I was looking to find someone this year to come in as a general manager as my understudy. The plan was to give me more time to be with my husband. But he died in March, which rather pre-empted that! It meant the need to find a replacement wasn't so urgent."
At 67, though, Warner knows she has to start making plans now if she is to leave the business in a sure state of survival once she quits. "A lot of the success of the business is because of my strong personality," she says. "But the secret really is my client base - it reads like who's who. It's confidential, but if I were able to drop a few names we'd get another 100 clients. People would think, 'well, if it's good enough for him...' but we can't do that."
Miracle Workers never set out to cater for such a clientele. "It was a chance phone call. I was rung by a chap who wanted care for his mother over Christmas. I never say no, so just rang round everyone I knew asking if they were looking for a well-paid job over the period.
"Someone said yes but she had two kittens. So I rang the chap back. 'I don't care', he says, 'because she lives at a castle - you can bring a menagerie if you want'. That lady happened to be extremely well connected, as was her son, and word got round. I just fell into offering care for the independently wealthy."
With a staff of 200, including regional assessors and 180 carers, Miracle Workers' services range from short term and specific care to a full live-in service, which costs around £650 a week. "We do the whole gamut now - cooking, cleaning, minding and driving. We give care and companionship. It's seven days, about 10 hours a day," says Warner. The company has 150 clients ranging in age from early 60s to late 90s.
She now has the bit between her teeth. "I would like to treble income," she says. "The business needs to get bigger."
Finding more clients and carers is key, but top of the list is to recruit a general manager who will be tasked with growing the business. "I'd be looking at taking on someone at about £75,000 a year," she says. Eventually they would also be able to take some equity in the debt-free business. "It will allow me to take more time off but I don't want to give up completely. Being on my own, I'd get bored.
"I have no preconceptions about who that person should be - they could be a male in their 30s or a woman in their 40s. The only thing is they can't be as old as me, or that would defeat the point. I want to get it sorted by the end of next year."
What they must have is strong management experience and an understanding of how a business works - including the legal and financial aspects, she says. "They needn't be health trained, I'm not. I can teach them how the business works." Only a few staff members are trained nurses. The Miracle Workers menu of services is aimed more at domestic help than addressing health needs.
Beyond that, Miracle Workers's future is undefined. It could remain as a private family-owned business providing income for Warner's barrister, banker and ITprofessional sons and her five grandchildren or she could sell and reap the rewards now. "I did get an offer for the company last September, but it wasn't enough," she says. "But every woman has her price."
What she's keen to do, though, is avoid a big tax bill if she does sell. "I'd like some advice on how to limit the capital gains tax," she adds.
EXPERT VIEW
Rupert Merson Lecturer at London Business SchoolSensible owner-managers take business planning seriously - but personal plans are just as important, and even the best ownermanagers forget about these. Those who, like Miriam Warner, find themselves running their own business by accident are particularly forgetful. "You ask me about an end game," a client told me once, "I'm just happy to be in a game." The personal plans of the owner-managers need to be reconciled with each other and with the business plan.
Warner needs to separate ownership from management. Evidently she's built a great business with lots of potential. It shouldn't be difficult to attract candidates to run it. Selecting the best can be difficult for a founder - it's tempting to recruit "someone just like me". If Warner is like some of my family business clients, she might be surprised to find one of her sons wants to get more involved. Once new management is identified Warner needs to think carefully about her own role. No role changes more than the founder when a new boss is recruited, and few make the change successfully.
Michael Dean Director of Advisory Services, The National Computing CentreThe Miracle Workers Agency is in a strong position, with great potential to grow.
Managed correctly it will be a continuing source of income for the family for years to come. But with Miriam Warner admitting that a lot of the success of the business is down to her, and her sons not wanting to be in the driving seat, she needs support now to help the business grow.
The recruitment of a suitably driven and charismatic general manager to share her knowledge and experience with is an imperative.
However, the unintentional entrepreneur needs to be clear with the new appointee where her and the family's influence begins and ends, otherwise the general manager might find themselves regularly over-ruled and outvoted by the rest of the family.
Non family members in family firms can become isolated and demotivated, so giving the general manager a stake in the business is a good move, and would be motivating even if the family were to receive a more attractive offer for the business in future.
Tony Ford Executive Chairman, B2Bdata.comMiriam Warner needs to assemble a proper management team and board of directors if she is to maximise her exit value. Given her age, this must be a priority and putting two family members on the board in case something happens to her isn't the answer for the company, its staff or its future.
Miracle Workers is in a hot sector at the moment with many financial and trade buyers out there. Rumours that CGT could go up to 40pc or even 50pc next year should focus Warner's mind as this is a very valuable business which will attract a high multiple. Her exit options now could include a management buy-out, which would normally be backed by a venture capitalist, but she needs a management team that is backable; a management buy-in, which would bring in a new chief executive and again would be backed by a venture capitalist; or a trade sale, as Miracle Workers is an attractive business and could command a premium price.
The right trade buyer would ensure that her legacy continues. A non executive director could hold her hand while going through this process.
Picture Caption: Miriam Warner has received one offer for her company, but deemed it too low. However, if the price is right, she has not ruled out a sale in the future
Picture Credit: JAY WILLIAMS
Copyright: Telegraph Group Ltd