Dotcom boss tells a moving tale of icebergs
Feb 20 2008 by Alistair Houghton, Liverpool Daily Post
Alistair Houghton meets internet entrepreneur and former Tiscali chief SIMON PRESTON
HE SURVIVED a kidnapping and the bursting of the dot-com bubble – now Simon Preston hopes he is moving towards another internet success story.
Preston was one of the founders of Cheshire internet service provider Telinco, which was sold in 2000 for £130m at the height of the Stock Market’s love affair with the internet, before becoming UK chief executive of internet giant Tiscali.
Now he has moved back into the internet world as chairman of Royal Mail-endorsed change of address website iammoving.com, which helps users tell dozens of organisations from banks to government departments that they have moved home.
Preston admits he surfed the dot-com wave to perfection, selling out before the slowdown of 2000-2002 that saw, according to one estimate, up to £2.5trillion wiped off the inflated values of technology stocks around the world.
The dot-com boom may have burnt many investors’ fingers, but Preston says that should not deflect attention from the massive technological advances made in recent years that have revolutionised the way we communicate and allowed companies do so much of their business online.
He said: “It’s important to decouple the two issues – the lemming behaviour of the financial community, which we’ve just seen with the sub-prime market in the US and which is a fact of human nature, from the profound importance of internet technology and the changes to the world we live in.
“This technical revolution is profoundly changing our society not just in the UK, but round the world.
“In 1997-2000, there was huge over-investment in that sector because investors knew something interesting was happening.
“But, if you didn’t get in early, you felt you might miss out.
“It’s about ‘first mover advantage’. Look at eBay and Amazon – there are other businesses doing the same thing but they’re never going to close that gap.
“There was a gold-rush mentality. But the people who bought our company made a lot of money out of it.”
Cambridge graduate Preston spent several years at Shell before joining North West Water, first in Warrington but then overseas as far afield as Malaysia and Mexico. It was in Buenos Aires that he had his brush with the Latin American underworld.
He said: “I came out of a bank in the business district, after transferring funds, and hailed a taxi.
“It conked out at the side of the road, and I said ‘I’ll walk now’. But two large guys got into the car, it started up and it zoomed out of town.
“My adrenaline levels were at an all-time high. They were speaking Spanish I couldn’t understand and wanted to open my briefcase.
“They drove me out of town, threw me out of the car and drove off.
“I thought I was going to be shot or stabbed.
“Later, I did some investigating through my Argentinian business partners. They were convinced they were drugs police and must have been looking for someone else.”
Preston left North West Water after it merged with Norweb to create United Utilities.
But he found his new career path over the garden fence when he teamed up with his next-door neighbour, serial entrepreneur Chris Matthews, and Peter Randall. The pair were setting up a telecoms business and Preston soon joined them.
Telinco was launched in 1997. It worked for the Sun, the Times and Sky and saw sales rise tenfold up to 1999.
“I remember coming out of Wapping after signing the contract and thinking ‘that’s going to be worth a lot of money’”, remembers Preston.
“We wouldn’t have sold the business for £130m without it.”
TELINCO was bought by World Online in 2000 and Preston became World Online’s UK chief executive.
Matthews left the company to pursue new business ideas. He died in a helicopter crash in 2004.
In December, 2000, World Online was bought by Tiscali, and Preston became Tiscali’s UK chief executive.
“I left at the end of 2001, mainly because I had financial independence and wanted a change of life,” he said.
“I didn’t really want to be working in London and coming home at weekends.”
Preston acted as a business angel investing in several small companies.
As well as leading him to iammoving.com, Preston’s angel role saw him get involved with Magnom, a business which supplies magnetic filter technology to improve the performance of engines.
He chaired Magnom, whose technology was developed by Liverpudlian Jobey Marlowe, until last year.
Preston is also an international director of the Young Presidents’ Organization, a 15,000-strong network of business leaders.
He has helped it expand its membership in Eastern Europe.
PRESTON became an investor in iammoving.com in 2003 but says his involvement was “passive” until he and fellow internet entrepreneur Eileen Rutschmann decided to take control in 2006.
He said: “I got talking to Eileen and it became clear that it was a great idea, but it wasn’t being very well executed by the management team.”
Preston says people typically have to tell 24 organisations that they are moving, from banks to the DVLA.
“It’s an iceberg problem,” he said.
“When you think about who to tell you are moving, you’ll probably think of seven or eight names. You might not remember, for example, your pension or ISA provider.
“When these things aren’t done, it can create problems including waste mail and a risk of ID fraud.”
Once consumers have registered with the site, iammoving offers them the chance to use its price comparison service.
Company staff can also help people get utilities connected before they move into their new homes.
The site makes its money through licensing fees from organisations signed up to its site. It also commits that customers will not receive spam or junk mail as a result of their dealings with it.
Preston says it is also vital for companies to have up-to-date address details for their customers.
The site also offers a change of tenancy service for landlords, who can then ensure they are not deluged with mail for former tenants.
The most avid users of iammoving are in the South East of England. Monday is the busiest day on the site as users plan their new life at the start of a new week.
Preston is confident the site can attract 50,000 visitors each month and says he hopes the company, which employs 20 people, will eventually employ around 50. Preston believes iammoving can prove just as much of a success as any of his previous businesses – and believes it has greater long-term prospects.
“I look back and see the iammoving.com business has more durable shareholder value than the Telinco business did,” he said.
“But we had the good fortune of selling the business in the biggest bull market of the 20th century.”
alistairhoughton
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