Martin Lightbowne

Martin Lightbowne planned to grow his group of financial services companies organically using social media marketing and online advertising until Dealmaker’s Academy showed how he could achieve quantum growth through acquisitions. Within five days, he’d completed his first deal.

Acquisitions Completely Transform a Business Plan

Although he didn’t realise it at the time, the complimentary ticket that Martin Lightbowne received for an educational event was the catalyst he needed to achieve massive business growth.
The educational event was, of course, the Mergers and Acquisitions FastTrack programme. When Martin received the invitation to attend it, he had big goals for his four companies: Onpoint Financial Services, which offers life insurance, mortgages, and health insurance; Onpoint Wills and Trusts; Onpoint Business Finance, which offers invoice financing and commercial mortgages; and Onpoint Wealth Management.

His idea was that the four companies would function as lead generators for each other, and provide customers with the specific services they may need at a given time.

Martin had thought that he would achieve his goals for the group organically by increasing its social media marketing and online advertising.
“I went on the course, and thought that it was great stuff. And so, I changed our entire business plan on day two.

“It was actually, ‘Let’s not grow organically.’” Instead, he wanted to grow the companies by acquiring other businesses. Before the five-day course had concluded, Martin had signed up for an advanced programme in which he’d discover how to apply what he’d just learnt.

The advanced programme finished on a Friday.

And in the following weekend, he worked on the offer he would take to prospective sellers. “It was how can we add extra value to an offer? If I was selling my business, what would I want to do? I know I would want to receive more than the market value. So how could we position our offer to make it more attractive?”

With that in mind, Martin produced an offer package that was designed to overcome sellers’ objections.

“We’re basically giving owners a percentage of the business forever. They get a share of what
they’ve achieved as the foundation, as well as a percentage of the future growth.”

“We played around with the numbers to make it attractive. For example, we decided to offer the sellers 25% of the net profit.”

The idea was to make the offer irresistible. To do that, it was essential to consider what objections they would have.

“Some people might say, ‘You can manipulate the net profit.’ And to counter it, we produced an alternative deal that was based on turnover,
we’ll say, ‘If you want a turnover, you get a much smaller slice. It means you won’t benefit from the efficiencies we bring. But that’s a choice you
may wish to make.’”

The sellers who were worried that their company might be bought, immediately flipped, as Martin knew how to allay their fears. He tells them,
“When we sell the business in three-, five-, or 10-years’ time, you get what you would have sold the company for today, deducting any payments you’ve had. We’ll give you a slice of the increase as well.”

“We also came up with a slogan to explain it: ‘You built your business into a legacy, let your business now become your legacy’.”

The first owner who was approached with this offer was Martin’s accountant. The offer was readily accepted. The terms were signed by Thursday of that week.

“Initially, our idea was to buy mortgage brokers,” says Martin, “Then I thought, ‘Wait, we need leads for those businesses. What if, instead, we
buy accountancy practices? Accountants are a great lead source for us.”

Owning accounting firms would resolve the problem he had experienced in getting a steady flow of leads through accountants. Martin had
found that accountants often forgot to refer his financial services company to their clients.

“They’re inherently not business-minded, so when you use them as an introducer, you’ll get three or four leads from them in the first two weeks, and then they forget. And when they’re paid for the leads they’ve produced, they’ll remember again. You get this up-down cycle.

“We thought that if we buy them, we can control the process. I realised that we had an option to actually buy our lead sources, and turn a cost centre into a profit centre.”

Instead of just buying one or two, Martin planned to acquire 50 companies in 12 months. “I said, ‘Let’s go for 50 accounting firms, then move on and do 30 or 50 mortgage brokerages, and then do the same with will writing companies.’”

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“It’s funny how the people who knew me well thought that I was absolutely nuts. They said, ‘We know you like to aim high, but you’re absolutely
off your trolley. You’re not going to buy 50 businesses.’ But we’re on our way.”

“We’ve bought one accountancy practice and a bookkeeping firm already, and we’re in conversation with four other companies at the moment.”

The accounting firm, which he had acquired in the week after his programme had finished, produced a turnover of £175,000 with a £30,000 profit.

“She got really excited by the company’s growth and enjoyed it so much that she wanted to set up her own business or, if possible, buy mine. That was about eight months into me having bought the business, so, after giving it some consideration, I decided it made sense to exit from it.”

“The owner has a really modern way of running accountancy practices; everything’s automated. It is a really good business.” 

“I knew that if we integrated our services, we could turn the £30,000 profit into £300,000 pretty much overnight. We hired him as the MD of Onpoint Accounting Group. His job was to run the group on a day-to-day basis and help with the acquisitions.”

At the time, the accounting firm had 20% spare capacity, which Martin’s companies used. Within five days, they had maxed that capacity out.
The new MD told Martin that the company was short on bookkeeping services.

“I said, ‘We can hire someone. Hold on, why don’t we just go buy a bookkeeping firm that’s got one or two people working for it with 20% spare capacity?”

He found a bookkeeping company run by a sole trader who was paying herself £25,000 a year. The company had a turnover of £60,000 and £800 profit. “We looked at the numbers, and knew that we could rip out a lot of the costs because we had the same systems in the first business.”

The company had £10,000 in the bank and a debt of £24,000 when Martin took over. “We took on the debts and, on day one, ripped out
the costs.”

“We now pay the former owner £25,000 as salary to work in that business, and take an overflow from the other businesses. It doesn’t cost us anything: the business is paying for her salary, and we gain 20% of her capacity to help with the overflow.”

While the numbers may seem small, Martin says that the impact of 50 or more will be profound.

“We can integrate other services. As part of a ‘Welcome to the Onpoint Group’, for example, we’re giving the existing clients of both companies a free will. On top of that, we will identify all the other needs those customers may have.”

Each free will could generate about £1000 worth of income across the Onpoint group. The customers will want one of our other services now
or at some stage in the future, and will return to us for a mortgage or life insurance, for example.

We have over 550 accounting clients now, and if they accept the offer of free will, that will add another £550,000 to the bottom line. That’s
pure profit.”

And it’s just the start, says Martin. “The whole philosophy is that every business must be fed by at least one other business.” He plans to begin buying estate agencies and letting agencies because those clients need accounting services, mortgages, and even estate planning.

Within 15 years, if his plan works, Martin’s group will be doing £100 million in revenue with a £400 million valuation.

“Last year, we had a turnover of £500,000 across the Group. Originally, our plan for this year was a £1 million turnover, but after just a few acquisitions, we’re already looking at a turnover between £10 and £15 million.

This success was possible not just because of the knowledge he gained from the Dealmaker’s Academy, but also because of having the right
mindset.

“When I told people that we’re buying an accounting firm, they turned to me and said, ‘But you’ve got no experience with accountancy. You’re a financial advisor with a master’s degree in mechanical engineering, so why the hell are you buying an accounting firm?’”

“I replied that I don’t have to know accountancy to buy an accounting firm. I’ve always said that we are a sales and marketing company that offers financial services. If you can understand business, and spot opportunities, then it’s huge.

For example, the first business we bought had a specialist team that does R&D tax credits. After talking to them, I realised that restaurants and pubs can claim R&D tax credits for developing drinks and menus, and it could be worth £4,000 a year for them. I thought, ‘Great. We can get three of our people to talk to hospitality companies who desperately need cash to help them get R&D tax credits. I know the owners ofpubs and restaurants are worried, and this will help.’”

“I’m passionate about solving client problems. Do I care about accounting? If I’m being honest, no. But the team we’ve got in place live and breathe bookkeeping and accounting. They’re very passionate about it.”

With a new MD in place, Martin will be free to find more businesses to add to his ever-expanding group.

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