Company sells 10% stake
Mobile marketing firm founders turn £4,000 into £10m
Grant Fraser and Iain Wilcox: ‘immensely proud’
Co-founders of smart mobile marketing agency, Digitonic, who launched the business with just £4,000, have sold a 10% stake to one of its biggest clients which values the business at £10 million.
The deal includes a commitment from the new, undisclosed, investor to deliver $5 million in additional revenue for the Glasgow-based firm over two years by entering the US market.
Commenting on the deal, Grant Fraser, CEO, said: “As well as tireless amounts of hard work and innovation, Digitonic’s growth has been fuelled by long-term retention of quality clients and partners.
“We have grown via innovation and commercialisation and we are now at a point where we are ready to accelerate our growth. While we are very proud of the fact that we have been able to grow without ever having to take a loan or give away substantial equity in order to fuel our sustained growth, this investment will enable us to rapidly grow the business.”
Mr Fraser founded the firm with business partner Iain Wilcox in April 2011. They each invested £2,000 of their own money to buy two laptops, two mobile phones and settle the first payment for a small office in Glasgow.
In May 2014, a consortium of four London-based investment angels acquired a 10% share, valuing the business at £2.25m. The investors offered invaluable financial advice and the freedom to explore and develop a futureproof GDPR, e-privacy and compliancy offering.
In April last year, Digitonic trademarked ‘Smart mobile marketing’, and three months later sold a further 2% stake to an experienced Edinburgh-based investor who now sits on its advisory board, valuing the company at £5m.
Mr Fraser added: “The first external investment in 2014 was to fuel innovation around our core mobile messaging platforms, however, the business commercialised much faster than we had first anticipated, so this money still remains untouched.
“To have turned our initial £4,000 investment eight years ago into a business worth £10m, while retaining in excess of 75% of the shares, is something Iain and myself are immensely proud of.
“We are now one of the fastest growing companies in our sector and we are excited to see what the next eight years bring as we plan to open a new office in London later this year and expand our client base into international markets.”
Digitonic is ranked 8th in the UK IP100 and is currently relocating to a larger office space in Glasgow city centre to facilitate its growth, hoping to double its workforce in size, from 20 to 40, over the coming 18 months.