What a CEO needs to know before taking the IPO plunge
An interview with Steve Groves, CEO of Partnership
The early years
Partnership is a trail blazer in the field of financial provision for those traditionally considered risky because of health or lifestyle. The business model is built around a ‘gold mine of data’, gathered over two decades, allowing it to accurately model life expectancy, and consequently offer better benefits than a mainstream insurer.
The success of this model is born out in its financial results. When Steve Groves joined in 2005, the business had just been rescued by private equity and by 2012, revenues had increased to £1.25 billion. It was time to look at an IPO.
The IPO process
Steve is not completely complimentary about the way IPOs are traditionally run. ‘It’s a really bizarre process… and to put it bluntly, pretty flawed.’
He decided to take a different approach, and the float was a resounding success, ten times oversubscribed with shares opening 65p above the opening price.
Steve cites two things that he would recommend any CEO pay attention to before starting out on the IPO road.
The top priority is to keep business performance in line with its historic results, although this is not easy!
‘It’s like trying to change the wheels on a Formula 1 car while it’s still moving.’ Steve Groves
The second point he makes is to take the opportunity to send messages to the market surrounding what to expect before the IPO – post-IPO is a completely different environment.
How does running the business change?
Steve cites a number of differences between running a listed company versus a private equity backed one. Communication becomes more time consuming and frequent, and he states that one downside is the short term focus quarterly reporting brings.
Read the interview with Steve Groves in full.
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