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Every entrepreneur needs a geek, it is said. Anne Duncan found hers – and married him. Their combination of inventive vision and commercial nous has taken Ms Duncan and her inventor husband Ian from the prosaic world of roadsweepers to the rather more glamorous power boat market with Yellowfin, which they are preparing to float on Aim this year.

The partnership has also turned Ms Duncan into a serial entrepreneur who has proved that you do not need a background in a sector to break into it and that you do not have to be under 40 to be a modern technology-based entrepreneur.

Now aged over 70 – though you would never guess it – she is reluctant to talk about her age or their relationship for fear of unfair pigeonholing. In fact, Yellowfin is stuf­fed with former Formula One and automotive industry engineers and claims to be about to shake up the marine propulsion market.

Nevertheless, sitting in her Southampton of­fices overlooking ranks of luxury yachts and power boats, she acknowledges the role of her husband in making her an entrepreneur: “My first opportunity [in business] came when I linked up with an engineer and inventor, and I think that was what I was missing all along. It gave me the chance to go into something disruptive.”

Their first venture in the 1980s, in partnership with a German maker of snow-cutting machines, followed Mr Duncan’s invention of small roadsweepers. “We saw a big gap in the market for suction roadsweepers because there was nothing reliable available then,” Ms Duncan recalls. “We came into the market and took an 80 per cent share in four years.”

The same philosophy underpins subsequent ventures in the sailing and power boat markets: “If you have got a new product and it’s good enough, and you market it well enough, and you do all the other things right, it’s not too difficult really to take over a marketplace.”

Yellowfin’s “variable surface drive” technology is a system of counter-rotating propellers that is computer-aided to adapt to changing sea conditions. The company says it offers much quicker acceleration than conventional systems, better manoeuvrability that alleviates the need for side thrusters, greater efficiency and lower fuel consumption. Its system of five units, ranging from 40hp to 4,000hp, can be used to propel boats ranging from small leisure craft to super-yachts.

The idea was formed while the couple were running a sailing boat start-up in La Rochelle, western France, which had just taken over a motor boat company. “We had a problem with a propeller. A main manufacturer came in with, literally a big hammer to put it right. That was the state of the industry then and, in fact, still is to a certain extent.”

Mr Duncan’s research into improving the efficiency of sailing boats was adapted and the pair brought the technology back to the UK, initially to Glasgow.

A model of the propulsion system was tank-tested at the University of Strathclyde to help win credibility for the new technology. A private equity group invested an initial £1m for 10 per cent of the company, although the Duncans had wanted “a lot more”.

Ms Duncan says somebody else tried to find the finance for about six months until they decided: “If it’s not the entrepreneurs themselves selling it, they won’t be successful because investors need to feel the drive and enthusiasm.”

The Duncans have since taken in a total of about £7m in investment and loans, about £6m of which has been private equity funding. They have retained a shareholding of more than 40 per cent prior to the planned flotation.

The greatest stress, she says, has been “keeping the money going”: costs have been high from the outset because of the need for highly qualified engineers from the start. Indeed her experiences have led her to campaign actively for greater support for innovative start-ups. “If we had been in the US we would be about two years further on because they are so much better at supporting innovation,” she says.

Even so, she was never put off by the large overheads of such a business: “That has always been the case with [Ian’s] products.”

In Glasgow, Ms Duncan struggled to find good offices and premises overlooking the water, which she knew would be crucial to attracting the right calibre of engineers. A visit to the Southampton boat show in September 2000 convinced her that the leisure boating environment on the south coast was a better location, with a local supplier base of electronics companies and precision engineers. The company moved within months.

But bringing the product to market has taken longer than Ms Duncan ever envisaged. The strategy had been to find a partnership with a leading engine manufacturer, who would market the propulsion system and sell it in a complete unit with its engines. An agreement fell through at the last moment and “we had to readjust.”

Another manufacturer offered development support, but because it operated in the upper end of the market, Yellowfin quickly had to adapt its work on small drives to double 700hp engines. “We would not have chosen to do that but as it was an upscale manufacturer we needed to do the large engines...But now we have a range of products that we can launch, although we have been slower to market.”

The plan to persuade a manufacturer to share the costs of bringing the drive system into production also proved unsuccessful, so they decided to bring it to market themselves but still using the distribution networks of the major manufacturers. That decision necessitated the planned public offering. “Bringing it into production ourselves entails a lot of tooling, more design engineers, test engineers, marketing people and logistics, so we have to build up the team.”

Yellowfin has so far agreed distribution exclusivity with two engine makers for different sizes of drives and is in talks with a third. The marine engine companies will sell the drive systems with their engines as a single bolt-on propulsion package for new boats. Ms Duncan anticipates turnover of £20m within three years.

The flotation might seem an obvious point for retirement. But Ms Duncan bridles: “I don’t think I will step back until it is in production and successful,” she counters. “A lot of my contemporaries would be retired by now. But I have got a lot more still to do, in the company and outside. That’s what keeps you going, isn’t it?”

‘Entrepreneurship is a genuine option for many older people’

“If I was growing up now I would have started as an entrepreneur much earlier, because there is much more opportunity.”

Anne Duncan always had latent business hankerings, after taking groups of people abroad when she was aged only 15.

But she thinks she came to entrepreneurship only later in life because it was a less acceptable career decision, especially for women, when she was young.

“I think you are born with certain qualities that make an entrepreneur and maybe your upbringing and environment determine whether you will actually become an entrepreneur.”

But she is convinced that entrepreneurship is a genuine option for many older people, whose wider experience of life can be an asset.

And, at an age when she might be enjoying a comfortable retirement, she insists it is not the prospect of more money that drives her on.

“Most entrepreneurs gain a lot of money but few would say they are motivated by money. They are motivated by the challenge of overcoming obstacles to be a success and by changing the way things are done.”

Copyright The Financial Times Limited 2017. All rights reserved.
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