Powerful partnerships: One year on with Detectortesters
In its first year with Inflexion, Detectortesters is moving to the cloud, has expanded internationally, and refined its pricing. The hard work is already paying off, and the journey has only just begun.
Despite not having worked in a private equity-backed business before, Detectortesters CEO Robert Campbell was confident it was a good way to ramp up a company. “I knew we had a great business and could grow even better in the longer run if we took on private equity,” Robert says, regaling the period prior to the September 2021 buyout of the fire detector testing equipment maker.
Initially however, his team had some reservations around selling to private equity: When he arrived four years earlier, the team had been certain that exiting through a sale to another company was the way forward. “It took many conversations with the founder and the management team to align on the fact that private equity was good for us – it’d mean more work for a time, but with a much more valuable business at the end that would benefit everyone.”
Robert’s enthusiasm was based on seeing other success stories rather than having had skin in another private equity-backed business himself: He’d worked at NYSE corporate before coming to Detectortesters to help the founder sell it. The process attracted a number of interested parties before being narrowed down to one plc and two private equity firms. Ultimately it was about the people: Robert had been neighbours with the CEO of a very successful Inflexion investment, and knew one of the lead partners from years prior.
“Firms come in and sell the story and all the positives about how they’ve grown other businesses and the support they can give, but you never know how true it is until you get in the other side. A year in and everything Inflexion said has been true; it’s quite pleasing,” he enthuses.
Chemistry makes the journey enjoyable, but ambition and graft has made it a success. Pre-Inflexion, Robert recalls board meetings were about numbers, monthly or annual goals, and dividends, but explains they’re different now. “Inflexion are very supportive and constructive in their input and are more about long-term value creation – ‘what are you doing?’ and ‘how can we help?’. The sessions are positive and influential.”
While the planning is longer term, the action is immediate. “They support us accelerating our growth, encouraging us to act in the first year since it’ll pay itself back in years 2 and 3. As a result, we’ve invested heavily in salespeople and skillsets, and we’re already seeing the benefits. It’s about getting the right people in place and investing in them.”
While Robert felt the pace slowed as he moved from a plc to a founder-led business, he admits it has ramped right back up since the buyout.
First year highlights
M&A: The initial investment by Inflexion saw Detectortesters acquire the 50% of its US distributor it didn’t already own. “The US is our biggest opportunity, so we’ve really focused on this market, adding four new salespeople and aligning the pricing.”
Further acquisitions may be on the cards, with Inflexion putting management in touch with other investment houses and agencies to help map the targets.
International expansion: Detectortesters are working very closely with Inflexion’s Rohit Hegde in India, with a new salesperson expected to be onboarded by year-end. “He’s incredibly helpful as ‘feet on the street’ with his local knowledge and it’s helping dramatically. We could never do that ourselves as we lack the reach.”
Digital cloud migration: Detectortesters is launching a new range of products in 2023 as its standalone testers migrate to cloud-based and offer online IoT devices. “This required a lot of change, with Inflexion’s Digital Team extremely helpful in upskilling our teams.”
Talent build-out: The firm has appointed a digital product manager and a new Chair was sourced with Inflexion’s support. “It was very collaborative; they supported with the longlisting and asked for our preferred contacts, then we chose together.” They are currently recruiting for a CTO.
Pricing effectiveness: Inflexion have supported some deep-dives to help management understand how to optimise global pricing and better articulate value going forward. “We’re growing each year, but we never really looked at this aspect and Inflexion’s experts are helping us to consider how to get more value from our pricing.”