Inline at Five: Reflections on founding and growing a political consulting firm
by Shomik Panda on 01 Jul 2019
Inline Policy was launched five years ago as the vision of our Founder, Shomik Panda. In this blog, Shomik reflects on the challenges of starting a business from scratch and some of the highlights of the past five years.
Inline Policy was launched in April 2014. We are a B2B advisory company that provides political, regulatory, and strategic engagement advice to tech companies. The past five years have been a journey of many highs accompanied by a few lows, but overall it has been great progress and lots of happy memories. It now seems like a good moment to pause, take a step back, and reflect on what has worked well, what less so, and what the future might look like.
5 Years in – contribution by numbers
How do you capture 5 years’ worth of growing a business? There have been so many exciting and worthwhile client projects, many wonderful employees, new products and services, progressively better offices, great suppliers. Equally there have been challenges: the odd client that didn’t pay the bills or honour contracts, hires that were the wrong fit, and times when we over or under extended ourselves.
Inline was a bootstrapped company starting with a sole client and myself as the founder and sole employee. From there I reinvested the receipts into more staff. We took a small amount of investment two years in, which helped to provide us with sufficient capital to grow the business a little more quickly than otherwise. Today we are a team of 11 people operating in both Brussels and London.
The business has grown each year and from a standing start we now have a recognised brand in the tech policy sector – and I’m proud that our clients include some of the biggest tech companies in the world.
It’s impossible to capture everything but here are some high-level statistics:
- We’ve grown revenues on average at 30-40% per year
- We have employed c.30 people over the five years
- We have two fully staffed offices: London and Brussels
- Since our inception we have paid upwards of £550,000 in employer/employee tax and social security contributions to the UK and Belgian governments
- We’ve had approximately 50 different client relationships over the period (including short term projects)
- Our longest running client has been with us since 2014
I start with these figures in order to try and paint a picture of how Inline and other small businesses contribute to the overall economy. We can be proud of the number of jobs created and opportunities provided. The PAYE figure, which is separate to other contributions made via corporation tax, is much more of a contribution than I personally could have mustered on my own, had I remained in-house or worked as a freelancer. Prior to starting Inline I never fully appreciated how small businesses can make such a difference, and I’m proud that we have managed to make our own small contribution in this way.
That said, such figures are meaningless if we weren’t also moving the dial for our clients, or if our staff were unhappy or not developing their careers. The interesting client projects that we have worked on, the staff that have launched and grown their careers with us, the laughs we have had in and out of the office, are all much more important and will be what eventually remains in the memory.
How we started
I had the idea for Inline, a political consulting firm with a focus on technology and innovation, whilst working at JPMorgan in Government Relations. I left JPMorgan in 2011 as I wanted a new, more commercial challenge. So I decided to take some time out to learn about entrepreneurship. I got accepted to business school, and then spent a year learning about everything that I should consider when trying to launch and scale a business.
Inline was eventually born in 2014. I had developed a thorough business plan and gained the confidence to launch it. But before I had the chance to raise the capital to build a team, I gained a client and had to service it. The plans remained in my mind, but with a client in hand I had to take a different approach.
HouseTrip, our first client, was the Airbnb challenger of the day. I had identified the sharing economy sector as one where a new innovation was going to grow rapidly and regulation was going to have to be developed. HouseTrip proved to be a great client that quickly grew into different markets and gave me the scope to invest in a couple of junior staff. We helped them in a number of different markets and reinvested everything we earned in hiring more high quality people so that we could improve our service to them and others.
From this beginning, Inline developed intense sector specialisation, allowing us to combine political and regulatory nous with an intimate knowledge of the market environment. Aside from the small amount of external investment, our growth has been organic. At each step of the way we have been committed to eschewing significant profits in order to grow the team and the skill set we are able to provide.
The early years – start up life
My experience of starting a business, one without large venture capital or angel backing, was exhilarating but testing.
The first two to three years were all hustle - both trying to win new clients and then working hard to provide a great service. The situations and circumstances that you are thrown into are very different to that of large corporate life. Frequently I found myself thrown into sub-optimal situations. Let me share few examples that spring to mind:
- Winning Clients: Getting new clients is always tough, but as a new business with no track record, we could only really attract clients that prized a cheap deal over anything else. I remember doing a project for a fledgling fintech company that wanted to understand the political and regulatory situation in each of the 52 states and jurisdictions in the USA before making a decision on which state they would enter. It was a huge and thorough undertaking, at least worth £20,000 in today’s market. I sold it for just £600, because that’s all they could pay! I was desperate to just do the work and have some client materials that we could market to others.
- Office space: I first started working from a business club, but that had to change when I started to hire people. We started sharing an office with another business that had a few desks free, but as soon as we moved in I realised we had to get out, and fast. The office culture of the other company was inappropriate, and the loos were unbearably filthy. A few months later, I loaned in my savings and we took up an office space in Vauxhall. This was an improvement, but there was only one window in the office and the room would become unbearably hot. It took another couple of years and office moves before we were able to settle into a modern office that we could be proud to call home. At last we could be comfortable hosting clients and prospective clients and no longer had to go to great lengths to meet our clients in their premises or other neutral locations!
- Dodgy clients: The vast majority of our clients have been a real pleasure to work with and get to know. However, at the beginning we did work with some less well-established companies and had a couple of instances of clients who refused to honour contracts or pay us for our work. We soon started to develop a radar for the more unreliable clients and who to avoid.
These early years were certainly precarious and not for the faint hearted. You can have a plan and you try and stick to it, but you are frequently blown off course and have to adapt. You try and learn iteratively and make sure you don’t make the same errors twice.
But they were also raw and exhilarating times. The wins felt immense, as did the losses. The team that grew with me saw the company develop into something else. We were all very proud as the fruits of our labours were very visible. In that period we were always just one or two clients or employees away from potential trouble. When those moments came, strong positive momentum could quickly turn into an atmosphere of despair and dejection. At those points you fight to keep the team together and focused and make the necessary changes that are needed for the good of the company.
What have I learned?
Fast forward a few more years and the company is in great shape and looking well set for strong growth. Our client book and suite of services are much more diversified and our team continues to grow and our offering improve.
There are many learnings, of which I will highlight a few:
- Building a business from scratch is tough – the early years involve major sacrifices, of mental energy, time and money. It’s not to be done lightly and won’t be for everyone. You need a good support structure and people around you that believe in what you are doing.
- Staying lean is critical: We had to mind our pennies and loosen the purse strings as we grew. Inline managed to weather some hairy moments because we maintained cost discipline. It’s easy to add to costs, but it is much harder to cut costs immediately when you need to - there is always a lag, which can put your business at risk.
- Diversification matters: Initially our business was not diversified and established enough to deal with the inevitable unpredictability of the business cycle. At various points in the first couple of years large proportions of our revenue could have been wiped out with the loss of one client. On one occasion this did happen in quite an extreme manner, and it had consequences for the company. We weathered the storm, but we were forced to make cuts. Those months were full of sleepless nights as I built multiple new plans to keep the company on the right path.
- Hiring well is so important: In a small company a bad hire can be the difference between a team that is together and one that is fraught with division. We spend a lot of time on our recruitment process to make sure we bring in the right people. We still made some mistakes, sometimes bringing in the wrong people and sometimes keeping people on for too long in the hope that they would turn out to eventually get it right.
- Maintaining a balanced team is a challenge: At times our team has become too imbalanced – either too many men, too many women, too many junior vs senior staff, or too many staff with a similar political affiliation etc. This has never been intentional and we have always just tried to hire the best candidate for the role. But after a while this becomes self-fulfilling and it becomes increasingly difficult to attract those that you are missing.
- Senior managers need to be a ‘jack of all trades’: Senior managers at small boutiques have to sell, deliver, manage, lead. This multi-faceted role can be difficult and does not necessarily play to the strengths of some very talented people who may be good at one or two of the required disciplines. Getting to a certain size allows you to get around this and really get the best out of everyone.
- Continuous training and development: I have always recognised the need for continuous education and for furthering our staff, but in a small company with little budget most of the development begins ‘on the job.’ We have a strong internal development culture led by the Partners, but as we have grown we now have more formal training built into our staff development plans, which is essential to improving skills and also for staff retention.
- Maintaining sales discipline: One of the trickiest elements in a firm such as ours where sellers are also delivering the work, is the maintenance of a consistent and persistent sales focus. It is very easy to focus fully on client delivery and hope that new clients will just fall into your lap. They won’t. We now try and maintain a much stronger focus on our selling capabilities and really try to build this into the DNA of our company.
So where next? In these turbulent geo-political times the EU is leading the world on tech regulation, and it is here that many companies must now focus their resources to ensure workable global regulations emerge. I firmly believe that Inline is well positioned to help our current and future clients across the tech sector to understand and influence politics and regulation, and we are well positioned to grow with our clients.
I remember when I started Inline meeting with Iain Anderson, the CEO of Cicero Group, to get some tips. I had been a client of Cicero’s when at JPMorgan. I remember him telling me that if we reach 3 years, we would be fine. I made a quiet mental note when we hit that milestone, but looking beyond, the stats show that approximately 50% of businesses fail within the first five years and 70% within the first ten. There is still a long and exciting road ahead before we reach where we want to be.
But for now, five years is a big milestone and it’s time to say thanks to all of our employees, clients, advisors, and investors who have supported us along the way and will hopefully continue to do so. We’ve worked hard for each other and now we’re going to take the chance to have a little celebration to mark this occasion.
If you would like to be part of the next exciting chapter of Inline’s journey – either as a client, investor, employee or board member - please reach out to me.
Written by Shomik Panda
Shomik is an experienced adviser on EU and UK digital issues and the founder of Inline Policy.