A solicitor expects to see sales at his business double within five years after private investors ploughed a significant seven-figure sum into the firm, increasing its value to £80m.
Since co-founding Winn Group 10 years ago Jeff Winn has grown the Byker-based business rapidly from a team of eight to 290 employees, working across two sites, focused on motor accident management services and road traffic accident claims.
The firm already has national reach. However, further developing its UK presence and its ability to target larger brokers had been hampered by government regulations which, until two years ago, only allowed investors to work with law firms.
Now, however, following months of talks, Winn has formed a partnership with international investment companies JZ International (JZI) and Souter Investment Group, allowing it to target bigger contracts, create new regional jobs and continue to expand its one-stop shop for accident management services nationally.
Twenty-two new jobs have been created in the past six months in anticipation of the deal, brokered by Newcastle accountants Tait Walker and law firm Muckle, and it is anticipated more will be created in the coming months.
The level of investment from Souter and JZ International has not been disclosed but the value of the firm has increased more than eightfold from its current recorded book value of £9.3m.
Jeff Winn said: “We know that the two investment companies looked at other, larger firms but they picked us as the best of the bunch, so it’s good news all round.
“I can’t discuss the amount but I can say that the investment values the business at £80m.”
“The government relaxed rules on investment two years ago and that has really opened the door, allowing firms to grow more quickly.
“One year ago there were certain business opportunities that we couldn’t take on because the cost of taking them on board was too high.
“Now, however, we can target different markets. It’s not going to be instant but there are more markets we can go into, such as work with larger brokers and dealership groups, and we can compete with the larger firms.
“That is going to be reflected in employment levels and in creating a bigger business.
“Recruitment is an ongoing process. We knew this was going to happen so have already created 22 new jobs, and one of the biggest contracts we are hoping to sign could generate 70 to 80 more jobs.
Within three to five years Winn expects to double the firm’s turnover to £40m and profits, currently standing at between £14m and £15m will also accrue benefits from the expansion plans, despite tighter market margins which have come as a result of significant consolidation, driven by regulation which has seen recoverable costs for low-value claims recently fixed by government at £500, a reduction from £1,200.
Winn is in no rush to extend offices beyond the North East, instead choosing to grow the firm’s national presence from the Newcastle base, maintaining and extending the firm’s network of sub contractors around the UK who cover accident management services.
The firm’s Byker headquarters have room for a further 150 employees, yet Winn has built-in planning permission to extend the offices for a further 300 employees when it reaches current capacity.
A member of both JZI and Souter Investments will now sit on the parent company board at the North East solicitors alongside Winn’s directors.
Managing director Martin Wright of JZI, which specialises in investing in and developing small to medium-sized businesses in partnership with founders and entrepreneurs, said: “The combination of the excellent management of the Winn Group and the operational and financial assistance of the JZI management group will enable Winn to further consolidate its position as one of the leading providers in the out-sourced accident management sector in a short period of time.”
Andy Macfie, managing director of Souter Investments, the private investment office of transport company Stagecoach’s founder Sir Brian Souter, added: “We are delighted to be backing Jeff and his management team and investing in such an exciting business. The accident management sector is undergoing a period of significant change and we are confident that Winn Group is well placed to grow strongly in this new environment.”