Network ROI, a Midlothian-based IT firm, announced on Thursday it completed an employee buy-out after receiving £1 million in funding from alternative finance specialist ThinCats. Founded in 2003 by Sean Elliot, Network ROI’s initial focus was to provide IT support to companies in Scotland. The company has also expanded to deliver a full range of managed IT and connectivity services to organizations throughout the UK.
While sharing details about the company’s growth and development, Elliot stated the company was looking into an exit strategy and a business plan to support. It needed £1 million to finance the transition, and went looking for sources of capital.
“We had a beauty parade and narrowed down potential funding sources to two – ThinCats and a conventional high street bank. While the bank’s business development people were keen to construct a loan that was viable for us, when it was referred to the credit committee we were presented with more draconian covenants, such as a shorter repayment term and taking all our business to the bank, which made the deal a lot less attractive. We never got to meet anyone from the bank’s credit committee – it was like dealing with a third party we never saw – but ThinCats business originator Maureen Armstrong made the process easy and straightforward, and they became our preferred option.”
In regards to ThinCats’ loan, Elliot added:
“The loan has allowed us to transition to full employee ownership, facilitating my succession. When we complete the second five-year phase, we may well look to ThinCats to refinance that.”
Network ROI currently has 32 employees, all notably with a stake in the business as a result of ThinCats’ financing.