Paul Gedman’s goal is to disrupt the world of private equity.
In a former life he headed up the beauty division at THG, overseeing 10 acquisitions.
Then in 2020 he joined forces with another THG colleague, former CEO of Myprotein Andy Duckworth, to launch Manchester-based eComplete.
A year later they made headlines with a £50m investment into eCommerce beauty business CurrentBody but have largely stayed under the radar – until now.
The company hope to announce their second investment before the end of the year and have ambitious plans for the eCommerce space.
According to Gedman, eComplete has spent much of the last three years building the foundations that it believes can help turn UK eCommerce companies into global brands.
“The real reason for us launching eComplete was to disrupt private equity,” admitted Gedman.
“How are we going to do that? We understand eCommerce very well. To enable us to compete with typical PE we have to build the eCommerce foundations that haven’t been commoditized by the market – data, talent, global infrastructure and scale – and wanting to share these with our partners as well.
“It’s not just acquisitions and investments. We have the agency side of the business.
“All the foundations that we’ve built we feel that they’re usually reserved for the £500m plus businesses but we want to democratise access to that.”
Gedman was speaking at eComplete’s recent ‘eCommerce meet-up’ event at KPMG’s Manchester office, where industry experts shared their insights in the sector.
He shared a panel with his co-founder Andy Duckworth, whose background is in sports nutrition while his is in beauty.
Explaining their approach Gedman said: “The fundamental thing we look at is data. We’re not category specific. We’re quite agnostic.
“Anything in eCommerce, anything that demonstrates it has the potential to be a UK leader or is a UK leader that we believe we can globalise (interests us).”
Gedman said there were two statistics that convinced them that the private equity sector was ripe for disruption.
“The reason we focus on private equity is that 75 per cent of all value that comes out of eCommerce exits goes to private equity, VCs (and) hedge funds. The majority of the money doesn’t go to founders or the teams doing the doing.
“Only 2.5 per cent of funds return more than 30 per cent IRR (internal rate of return) by the time they get to the third fund.
“Why do they get poor results? A lot of them aren’t eCommerce operators and don’t understand the dynamics that impact on an eCommerce business. We do a hell of a lot more than typical private equity.’
Gedman said CurrentBody was a perfect example of how eComplete can add value.
In the first 12 months after their £50m investment in 2021 a total of 28 members of eComplete’s staff worked in the CurrentBody business.
“If we’re going to impact eCommerce businesses we need to be able to understand, in the data, the issues that they’ve got and provide businesses with access to talent and opportunities,” explained Gedman.
He told the audience at the eCommerce meet-up that they’d entered into an exclusivity deal with a second company that they plan to invest in.
“Like any business we’ve had to prove ourselves,” he said. “CurrentBody was an opportunity we couldn’t pass up on. We actually did that deal when we were under one year old.
“We’ve spent the last couple of years building those foundations to make sure that they work and that we can have high impact of eCommerce businesses.
“We’ve seen the impact they can have on CurrentBody so we’ve almost got all the proof points we need now. That acquisition is going phenomenally well.”
The other speakers at the event were Laurence Newman, co-founder, CurrentBody; Anna Graham, managing director, eComplete; Ed Prior, KPMG; Les Yates, strategy director, eComplete; Tim Hamilton, partner, Pannone Corporate; David Meakin, Shopline; Joel Williams, ChaChing; Danielle Nichol, REFY; and Alice Oakford, founder of Social Honey.