Welcome to our Private Equity People series, PEPtalk, where we speak to some of the most exciting figures from across the private equity industry to hear their insights and share their experiences. Inspired by recent studies showing there is still far more to be done to encourage diversity in private equity, the aim is to create a platform to showcase a broad range of role models who are successful founders, investors, private equity professionals and entrepreneurs. First, we are focusing on some inspiring female figures – we are lucky and honoured to have some great guests lined up, starting with Anita Dougall, CEO and founding partner at Sagacity.
Subscribe now to be a part of this growing Private Equity People community and take part in interviews, events and roundtable discussions.
“PE makes the most sense for us because it’s not just about funding but also about the direction, guidance and support we gain from our investment partners.”
Anita Dougall, CEO and founding partner at Sagacity
Founded in 2005, Sagacity works with its clients to join the dots between their data, people, policies, processes, and systems to help them maximise return through data driven insight.
An investment by Queen’s Park Equity (QPE) replaced a previous investment from MXC Capital, with BDO providing financial and tax vendor due diligence services. We caught up with Anita Dougall – who founded the business alongside Malka Townshend and Harry Dougall – to find out more about leading a private-equity-backed business and the future plans for Sagacity.
Can you talk us through your business growth journey to date?
Sagacity started in 2005 working predominantly in telecoms. From there, we diversified into energy, water, financial services and so on. As we increased our sector presence, we also developed our offering, moving from purely consultancy basis into delivering a platform and software to help our clients. Importantly, this allowed us to make our service more predictive, accurate and repeatable, which let us begin to grow at pace. We now have around 80 employees with recruitment ongoing to further expand our team to support growth.
Why was private equity investment right for you and your business?
I believe we needed a partner to take us through our growth journey. This is our second round of private equity (PE), our first round of funding helped us develop our software and solutions; this time, it’s all about scaling up and making a step change with a PE partner that understands our business, the gaps and, most importantly, what capability we need to invest in to close those gaps.
PE makes the most sense for us because it’s not just about funding but also about the direction, guidance and support we gain from our investment partners. For a growing business with eyes on expansion, the advice and experience of our investors is invaluable. We wouldn’t have been able to recreate the value this adds if we’d taken on debt funding or looked to fundraising on capital markets for example.
How did you choose the right private equity partner for your business?
We went through a structured process and looked at about 15 funds before deciding on Queen’s Park Equity. One of the key reasons we connected with the team at QPE was their cultural fit – this was top of our agenda and something we weren’t willing to compromise on. Lots of funds understand the market and tech, but when you need to work closely with a team day in, day out, there must be a genuine connection.
QPE also demonstrated a strong understanding of our business early on in the process and articulated the levers we need to pull to close the gaps to aid accelerated growth. Their experience in growing companies by working collaboratively with the management teams was very apparent.
What tips would you give to someone considering private equity investment?
There can be a temptation to look at PE funds which specialise in your sector, but this may be limiting and not required as you know your own business and industry. For us, knowledge of growing businesses at a similar stage to ours and experience of road-mapping plans for achieving scale was paramount.
We found it very beneficial to be clear – with ourselves and with the fund – on why we wanted investment. Being upfront about your status, the positives, the shortfalls (including areas where you acknowledge there is room for improvement) and what you want to achieve is the only way to get a deal which is right for you.
No stone goes unturned in these processes, so it’s important to be honest with yourself about where your business needs help. If you are open about your weaknesses and challenges from the start, then the fund can work out how to address that. No business is 100% perfect - so don’t hold back on sharing where you feel your company can be enhanced.
In my view, you should feel like you can talk to your investment partner about anything in the business – even if something hasn’t gone to plan. I’d suggest if you can’t, then you’ve probably not found the right investment partner.
What advice would you give other female entrepreneurs looking to scale a business?
The PE community can be quite male dominated, and you will undoubtedly come across some egos when you embark on a process. Don’t be put off. Be patient and look for the right partner who will recognise you, support you, understand your business and have considerable value to bring to the partnership.
The other important factor is to surround yourself with experts, recruit strong leaders and ensure you have a strong succession.
What would you have done differently in the process, if anything?
We’d have looked to attract investment to support growth sooner. PE investment wasn’t on our radar in the business’ early days. With hindsight, we’d have accelerated our growth further by having a funding partner like QPE earlier.
There is a high demand for talent at the moment across sectors; how do you attract and retain the best people?
Cultural fit is very important. We believe in being really clear and honest on what we are looking for and what it would be like to work at Sagacity. Training, coaching and being supportive of our teams is important but the fit must be right for any of that to work. We’re upfront about the job and find that our approach is rewarded because only the right type of people will respond to it.
What big picture trends are you currently seeing in your industry or across PE-backed businesses?
Economic uncertainty is the biggest threat. It’s slowing down decision making at a senior level which is ultimately impacting the development of entrepreneurial businesses where confidence is key.
Within tech, there’s a lot of talk about data but not much clarity on what all this data insight is capable of. Businesses need to be more specific about their desire for data and also understand that it’s one part of the picture. It must be coupled with industry knowledge, domain expertise, operational know how, customer insight, listening to stakeholders and so on to deliver its maximum value.
There is also a huge focus on quantifying the benefits from the solutions being offered, which is something Sagacity has focused on with its clients.
What’s in store for your business in the next 12 months?
We have lots planned! The key things are creating a platform for growth in terms of our capability, specialisms and the tech itself. We’re also growing the team, with new additions joining and also investing heavily in our existing staff. M&A activity will also be on our agenda as we grow.
Are you considering short-medium term investment options, including funding requirements and need to build your knowledge of private equity? Read our demystify brochure.