Ernst & Young's Richard Jones learnt business basics on a North Wales farm. Since then his simple, patient principles have yielded a crop of successful businesses and individuals. Words by Tony Glover.
Bristol-based Richard Jones knows how to make you feel jealous: "On Friday evening, if I want to visit my second home in Cornwall, I can be there in two-and-a-half hours. It would take at least seven hours if I worked in the City."
It is telling that the Ernst & Young corporate finance partner, who has worked at the group's Bristol office since it was founded in 1985, peppers this interview with as many tales of beach fishing and local football and cricket games as he does deal anecdotes. He believes the South West environment is a crucial factor in the success of the Bristol corporate finance department and that offering the right work-life balance is vital: "To be successful in corporate life you need the best people, so you need a great location with a good environment."
Richard Green, joint managing partner at August Equity, believes another aspect of Jones's success is his relationship skills. The pair first met in 1988 and since then Jones has worked on numerous deals with the August Equity team.
Jones was brought up on his family's farm in North Wales. Unlike the larger holdings increasingly common in Britain, the Jones farm was not a semi-industrialised complex or the property of wealthy landowners. It was a "working farm", on which the whole family was expected to pitch in. Selling the family produce to local households helped him understand the realities of business and profit margins. As a result, he has developed a community focus that has stood him in good stead in his corporate finance career. He points out that Ernst & Young's tactic of building upon regional strengths - rather than concentrating purely on City deal making - distinguishes it from many corporate finance rivals.
Jones's two decades of experience have given him an unrivalled pool of regional knowledge and made him a key player in the South West. Along the way he has developed something of a talent for creating wealth for his clients. "A total of 86 of my clients and ex-clients are millionaires as a direct result of deals I have been involved in," he says. So it is hardly surprising he has not been tempted to move away from Ernst & Young - he enjoys the role of corporate financier too much: "I get a buzz out of helping people."
Jones highlights one client with personal outgoings of £8,000 a month who owned a distribution business. Jones and his corporate finance team spent 18 months helping the client develop a business proposition, which ultimately lead to a £60 million exit.
Another example - Parkdean Holidays - showcases his talents on a larger scale. Jones worked with the company, valued at just £6.8 million in 1989, for 16 years on various acquisitions and disposals. It was recently sold for £230 million. "Richard's strength lies in the empathy he has with the companies in which he is involved," says Andrew Hartley, joint managing partner of August Equity. "He also takes time to build proper relationships with the companies he advises. He and I share a common belief that deals spring from relationships, and relationship building should be the first step in value creation."
According to Hartley, Jones has another crucial string to his bow - a solid grasp of the businesses he is involved with and the industry they operate in. "He is the acknowledged expert in the building materials sector," says Hartley. "His specialist knowledge was an important factor in developing the business and in the successful timing of August Equity's exit from Securistyle."
August Equity sold the Cheltenham manufacturer of architectural hardware products in a £42.3 million deal to Bank of Scotland Integrated Finance in December 2006. "I got to know Securistyle over a period of 18 months, working with them long before structuring the deal," says Jones, who handled the exit. "This gave me a chance to examine the company's teamwork."
He says he has never seen a successful business that was not the result of first-class teamwork and believes there are striking parallels between business and sport.
"Many successful business people have been successful at team sports,"he says. "It enables them to develop the will to win. But it also breeds an understanding that the point is not to go for a short-term gain and win at any cost. To build a winning team you need to bring out individual player strengths and compensate for their weaknesses."
He adds that when Ernst & Young holds its Entrepreneur of the Year ceremony, the winner unfailingly thanks the other members of his or her team while accepting the award. "Every chief executive is only as good as the people he or she has around them."
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