"Do you regret selling Myprotein?" "Did I sell too early?" are common questions I get asked.
I've generally chosen not to discuss this aspect publicly because I value privacy in these matters. However, when discussing the Myprotein sale, I realise that omitting this part of the story doesn't give a full picture of the circumstances. It's important to share this context to provide a clearer understanding of the decisions made.
When considering the decision to sell Myprotein, it's crucial to understand the full context and my strategy at the time.
Initially, my intention was only to sell a minority stake to PE.
This was my decision instead of taking a bigger cash out because of my confidence in MP.
It was the #1 in Europe.
It would be #1 in the world.
This would enable me and the senior management team to drive the business forward for another 3-4 years, with plans for a IPO or another investment round.
I was determined to avoid any unfavourable PE provisions, such as 'bad leaver' or 'swamping', and was also adamant about avoiding typical PE tactics like 'chipping' after an exclusive due diligence period.
Unfortunately, one large unnamed private equity house attempted exactly these tactics, and we consequently ended our discussions. They later remarked that 'the one that got away.'
As for The Hut Group, the situation evolved in unexpected and unfortunate ways.
Upon selling, I believed THG was financially healthy, reporting profits of c.£6m per year.
This was a significant factor in my decision, especially given that Myprotein was a larger and more robust business, with legitimate profits of over £5m annually and positioned in a rapidly growing market, unlike THG’s CD-selling business.
However, it was later unveiled that THG was actually suffering losses of £1.1m annually.
This discovery, confirmed to be fraudulent by the High Court - which awarded me significant damages.
It became evident that there had been deceit not only from THG but also, regrettably, misconduct from one of my own advisors, who, I later learned, had vested interests.
I typically don't dwell on regret as it serves no purpose, but valuable lessons.
The decision to sell was based on the best information available at the time and was aimed at securing a stable future for my family for generations.
Importantly, my strategy included rolling over 50% of my stake into THG, as I was confident in MP's trajectory to become the world's number one, building on our status as Europe's leader.
Had I been aware of THG's actual financial state, my decision at that time would have been different.
Reflecting on this, the experience, though challenging, has been immensely educational.
It has underscored the importance of transparency and the critical value of having trustworthy advisors.
These lessons are now integral to how I approach business and personal investments.
