A few months ago I got an email from a 28-year-old entrepreneur about his tech company. His pitch was a model of clarity and brevity, devoid of PR-speak. He wrote about “aiming to replicate the success of online estate agent Purplebricks in an equally large, albeit more boring market: boiler installations.”
I was interested in Simon Phelan and Hometree, his online gas boiler installation company. A smart ex-plumber with a plan to disrupt his own industry is intriguing. And admitting that you are in a “boring” business is refreshingly honest, but clever too, because it is almost unheard of.
Start-ups doing anything new, cute or plain off-the-wall often struggle. Two years ago I wrote about a pavement delivery drone, which has yet to hit all but a handful of streets. Virtual reality is nowhere near mainstream. Doppler Labs, the company behind Here One wireless earbuds — which allowed listeners to “edit” the sound around them by tuning out annoying noise — failed, in spite of investors such as David Geffen and Henry Kravis.
Possibly the craziest product ever was a wand with which to order a takeaway delivery. It is still, according to its progenitor, Just Eat, “a prototype and very early in the development stage”.
Boring may be the new interesting. Also in 2016, I wrote about a new breed of online mattress company— Eve and Simba among them. At the time, Simba forecast £100m turnover by 2019. When I interviewed him recently, Simba’s founder and CEO, James Cox, said that the company expects to hit £310m next year.
Then there is Mahabis, a carpet slippers start-up. Slippers may sound more hip-replacement than hip, but its chief executive, Ankur Shah, told me his company has sold close to a million pairs of its £79 product.
Meanwhile, another boring domestic product, razors, have proved to be a lucrative market for what are essentially tech companies, such as Dollar Shave Club (bought by Unilever for $1bn) and Harry’s. The latter claimed last year to have sold more than 6m razors.
It is not just products: dull-sounding online services also seem to pay off. London start-up ClearScore, a millennial-focused fintech company which offers users free credit scoring and personal finance guides, sold to Experian last month for £275m, after just three years in business.
Mr Phelan’s fledgling Hometree could head the same way. “Since launching just over a year ago,” Mr Phelan had written in October, “we will do well north of £1m revenue in our first trading year. We have become one of the top-rated installation firms in the UK on Trustpilot, have raised over £2.5m from some of the world’s leading technology investors and have a team of more than 25.”
Six months on, Hometree has had £5.5m investment and employs 45 people. So I went to meet Mr Phelan at his serviced offices in north London. He is not an ex-plumber but a Dubliner with a degree in engineering and maths from Trinity College. By 24, he was CEO of the Irish wing of stationery distributor Spicers, with 250 staff. Then he came to London to try his own thing.
That turned out to be gas boilers, not because he was interested in them, but because he was looking for a way into the growing smart-home sector. He wants to build a slick way to modernise boiler installation, so that by the time newer, more eco-friendly home heating technologies become standard he will already have a loyal customer base. This is why Hometree has more in common with tech companies than with local plumbers.
“Where I think people go wrong in entrepreneurship is building a product, rather than a business for the future,” says Mr Phelan.
Any very young entrepreneur may flame out and sell up. But I asked an older hand in the business, Justin McInerney, CEO of Irish heating technology company SmartZone, for his views on Hometree.
“Simon has had a very, very good start and is executing quite brilliantly,” he said. “Making a neglected category simple and elegant is attractive.”
“All you have to do,” he concluded, “is not to see it as a gas boiler business, but a much bigger play.”
Indeed, Mr Phelan’s idea that new businesses need to be strategic rather than excitable about this or that gimmicky new product is one that other entrepreneurs would do well to follow.
It would surprise no one, for example, if Eve or Simba were to find a way of vacuum-compressing bulky, squishy furniture beyond mattresses into easily delivered packages. Both have already gone into duvets and pillows. Perhaps whole sofas could come next, and mattress start-ups would turn into mature homeware companies.
The value of sticking to dull or unspectacular fields is also surely a golden rule for success.
It is not as if there is a shortage of boring products with which to found your future conglomerate. Anyone for disrupting, say, the cement business? Or Wellington boots? Or — why not — building a better mousetrap?
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