THG’s CEO and founder Matt Moulding said he’s ‘put his money where his mouth is’ by taking the company’s tech arm Ingenuity private.
Shareholders have backed plans for Ingenuity’s demerger into a standalone private business.
Moulding said taking Ingenuity private was the ‘obvious solution’, adding his ‘arms are wide open’ at the prospect.
However, the entrepreneur admitted that just because he’s super wealthy doesn’t mean he doesn’t have worries.
Writing on LinkedIn he said: “Like anyone, I’ve had some tough years in my career, and 2024 has been another. And yet, this even surprises many closest to me.
“Most people presume I can’t have many worries. Yes, I have a lifestyle I didn’t know existed when growing up in a small Lancashire terrace house – I pinch myself most days.
“And sure, my family office recently completed one of the UK’s biggest commercial property deals in 2024.
“And tomorrow, Ingenuity will be a private company again, with me back as the majority shareholder – putting my money where my mouth is.”
The 52-year-old entrepreneur said people only see the lifestyle and the deals – and not the ‘grind’ that goes in behind the scenes.
“A useful skill is smiling through tricky times,” he explained. “Swan-like above the water, with serious peddling going on beneath.
“But it’s the stuff people don’t see that often brings pain, plus the burden of responsibility. I’ve (got) some of the best people around me – the THG team, our board, some incredible shareholders – plus family and friends. I know they feel it too.
“This is more than an unpaid job to me. It’s a passion, a responsibility to prove what I know to be right.”
The eCommerce giant told the London Stock Exchange (LSE) in September that THG Ingenuity would be splitting from the profitable bits on the business in THG Beauty and THG Nutrition.
However, Moulding said a lot of the criticism of the loss-making digital tech commerce platform had been unfair.
“Since THG joined the LSE five years ago, some labelled Ingenuity worthless, or worse, a huge liability,” he explained.
“This is despite us investing $1.5bn over 20 years to build Ingenuity into a truly global platform that today services many of the world’s biggest brands.
“Ingenuity has c3,800 staff with annual revenues and profits/EBITDA approaching c$800m and c$35m respectively.
“Yes, Ingenuity had a cash burn of c$90m in 2024 as we invest in building out the proposition further, but this has been reducing fast as the business scales.
“This is the reality of tech investment: you build it first and then charge people to use it. You wouldn’t try charging for hotel rooms before a hotel was built, tech is no different.
“Spending endless energy proving otherwise to a UK market devoid of tech businesses is a zero-sum game.
“The UK’s much higher interest rates than Europe post Brexit hasn’t helped, with the dwindling capital pool of the LSE exacerbated further.
“Taking Ingenuity private was the obvious solution. And so, the City has now thrown Ingenuity back to me – quite literally. My arms are wide open, as are the arms of hundreds of small investors joining me in taking Ingenuity private.”
THG plc reveals details, timeline for demerger of tech arm Ingenuity
THG recently raised £95.4m to facilitate the demerger, including £10m from CEO Matt Moulding and £10m from Mike Ashley’s Frasers Group.
As part of the demerger, THG’s COO John Gallemore will take up the role of Ingenuity’s executive president, with all other executives at THG and THG Ingenuity remaining in their current roles.
THG’s share price currently stands at 44.48p.