Poundland founder Steve Smith is one of Britain’s entrepreneurial poster children after he turned his market stall into a successful chain of 84 bargain goods stores in less than 10 years. Poundland still continues to dominate UK high streets to date.
Britons love bargains and clearly, Smith knew how to tap into that mindset. He now hopes to turn his latest venture, estatesdirect.com, into another IPO goldmine.
“I don’t like feeling I’ve been ripped off. The British public feel the same way I do,” said Smith to Business Insider. “At estatesdirect.com I get a buzz when customers tell me how they have saved thousands by selling their property and are now able to build a new kitchen or plough that cash into doing up their new house.”
“We have a three year plan of becoming the market leader in the UK. We are focusing on that at the moment, so while launching an IPO in three years’ time is a possibility, the public can still invest in the company in the meantime.”
He said that estatesdirect.com is already going to hit a projected value of £175 million ($US264 million) in just 36 months.
Smith opened his first stall, aged 18, in Bilston, West Midlands in the 1980s. In 1990, he and business partner Dave Dodd launched Poundland. After growing Poundland to 83 stores, he
sold it a little over a decade later for £50 million to Advent International.
The new owners listed it on the London Stock Exchange in March last year. Investors couldn’t get enough of Poundland’s shares at the time. In fact, they soared 19% from its float price 300p on the first day of trading. Poundland’s stock price is currently trading at 391.30p as of 9 March.
Fixed-fee online estate agent Estatesdirect.com was launched in 2012 by DatingDirect.com’s (which later re-branded as Match.com) founder Darren Richards and entrepreneur Ben Grove. Smith is the Chairman of estatesdirect.com.
Estatesdirect.com strips out the estate agent from the supply chain, meaning that people can market and put their property up for sale across Britain’s biggest housing websites for as little as a £1. For as little as £295 plus VAT, homeowners can have a fuller package of selling home, including market materials, set ups for valuations, viewings, as well as help with conveyancing solicitors.
Currently, in the UK, estate agents charge a commission plus VAT for selling your property. For example, if you used one of London’s largest estate agents Foxtons’ rates at 2.5% plus VAT, selling your property for £250,000 can leave you with a bill of £7,500.
Estatesdirect.com was originally launched as a regional pilot project in Midlands but has since steadily grown its network across the UK. While customers can sell their properties anywhere in Britain, estatesdirect.com have agents in Wales, the Midlands, London, Surrey, Southampton, Exmouth and East Devon, Rochdale, Cambridgeshire and Peterborough. These agents are there for customers who want people to conduct viewings and deal with customers directly.
“It has always been part of our plan to grow nationally. We are aiming to be one the largest estate agents in the UK over the next three years,” said Grove to Business Insider.
“We’ve invested over £1 million in the right technology from the start to make sure we have the best systems. Steve [Smith] and I are self-confessed tech geeks. We understand what we need to invest in to make it simpler for the customer as well as more cost effective for us. It will also allow us to expand significantly.”
Smith understands the power of tech and a more grass roots approach to building up a company, as demonstrated by the meteoric rise in Poundland. Smith and Groves explained that the tech “empowers” customers due to the easy nature of applications.
For example, it uses Microsoft Cortana, which is like Apple’s Siri, which is a voice activated digital assistant. It allows customers to write their property descriptions and build floor plans “before you very eyes.”
Last month, Smith offered £1.25 million worth of shares in EstatesDirect.com to the British public via crowdfunding website CrowdCude. As of 9 March, the group has raised £906,240 for 5% equity offered. In 2014, a similar round of crowdfunding generated
£493,550 from 181 investors, although its target was £250,000.
“There’s enough business in Britain for us right now as we still need to expand nationally,” siad Smith.
Grove added “we were looking at Spain and France but then the market went tits up. But we are definitely going to be looking overseas. The US market is huge and that is definitely somewhere we’d love to be.”