Simon Corbett's big mistake: "Selling my business too cheaply"

How it happened

In the year 2000, I was doing a year out from university. I started a job website, jobsmk.co.uk. We offered jobs at junior and clerical, unlike higher-end competitors, we undercut the local paper, and before we knew it we were advertising 300-400 jobs a week.

We were bringing in about £7,000-£8,000 a month. I had four people doing the tech stuff and I was doing sales and marketing. 10,000-15,000 people a month were using the site.

Recruitment agencies were out biggest customers, and they were really happy with it.

It got to about three or four weeks before I had to go back to uni. I had the dilemma of: do I stay on and make a career out of this, or do I go back to do my final year?

Then one of our biggest clients, a recruitment agency, called up and said they'd be interested in buying the business. They were placing about 40 jobs with us a week, spending quite a bit of money. So there were two advantages to them in buying - if they owned the site, they wouldn't have to pay to put jobs on it. And, they'd effectively be taking money off their competitors who'd be placing ads on it.

It was all so exciting at the time, we didn't stop to think about it.

When they came round, I was really honest and explained my situation. They said they'd give us everything we'd earn over the next six month plus a bit more, saying it could all go downhill, we could have competitors. And we thought: "You're right, if we win nothing else in six months this would be a great offer." We said yes - it was all done in the space of one conversation.

What I regret

In hindsight, we'd got to the stage where that wasn't going to happen - the business wouldn't have fallen off a cliff tomorrow. It was working. We had no debt, we had great cashflow, we had long-term contracts, spread over the next six or nine months - guaranteed pipeline revenue. And we had a great brand.

That was all worth a lot, and that's what we didn't really consider.

The lesson I learned

If I was doing it now, I'd definitely get professional advice - someone who'd been there, done it before, and people who value and sell businesses for a living, so I could make sure I got the right figure in terms of the brand and what it's worth. The process would normally take about three to six months, I guess.

But I didn't get any advice regarding the valuation of the business. They said a figure, we said yes, they got out their cheque book.

I probably could've got about 25-30% more.

At the time, for me, it was fantastic - I was 20, and it was really exciting. I bought a Z3, I could leave university with absolutely no debt, I could pay to do a masters and still have quite a chunk of money in the bank for a house deposit. They knew it was a good offer for me.

So I made the right decision for me - but I'm kicking myself now for it!

Simon went on to do his final year at university and then completed a masters. He is now running his third business, PR agency Jargon PR, which is, he says, 'doing very nicely'.

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