Case study: starting up overnight at 3Objectives
Paul Downes worked for photography studio Barrett Berkeley for eight years before the company went into administration and he, Aneta Swoboda and Daniel Schweitzer, formed 3Objectives from the remnants of the company – in just 36 hours.
Aneta Swoboda, Paul Downes and Daniel Schweitzer, the directors of 3Objectives
has been operating for only a few months – since March 23, 2011 – it has managed to retain clients, move to larger premises and even take on new clients, all at a time when austerity has been a keyword in the news. Paul tells us how the company started up, and how 3Objectives is winning new business and moving to new premises.
Due to the lasting effects of the financial crisis, Barrett Berkeley announced in mid-February 2011 that it would be going into administration. With one and a half weeks left to go before the administrators came in, Barrett Berkeley’s administrators found a potential buyer – however, this fell through because, after looking through the company’s books, they felt that it was not profitable enough to continue.
Paul, Aneta and Daniel opted to purchase the assets and carry on the business themselves, right at the last minute. The administrators were already in the office, Daniel was trying to set up a company and bank account online, none of them had any experience in running a business and yet they managed to set up a company in 36 hours. Having shut down Barrett Berkeley on a Friday, 3Objectives started trading the following Monday.
As Daniel and Paul registered the company and looked into bank accounts, Aneta continued with scheduled photoshoots to keep clients happy – very few of them were aware of any changes until they were informed of the changes and asked to support the 3Objectives venture, which they were largely happy to do.
They hired a retoucher, Glyn, on a year-long contract and signed all the necessary papers before seeking new premises. They went to Barrett Berkeley’s landlord but because the owners had had financial issues he was wary to rent a studio to 3Objectives, despite reassurances that it was a completely different company. Again at the last minute, they were offered temporary accommodation two doors down from the current office. 3Objectives will now be moving again into a studio upstairs from their current premises as their temporary lease has expired.
Having to raise the finance to start a new company almost overnight was one of the hardest parts of the challenge. They initially turned to family and friends: “Begging, borrowing and stealing from friends, as we like to say”, Paul comments. Paul’s father had recently been made redundant and sold his home – as he had received a good redundancy payment he was willing to provide some finance. Aneta’s father-in-law also offered some money as a loan, and Daniel raised further funding via credit cards.
When Barrett Berkeley’s assets were sold off at an auction, the money Paul’s father had invested was used to purchase the equipment – however, due to some issues with the administrators they ended up paying slightly more than expected. The rest of the money they had raised was used to pay their first two months’ rent.
After 3Objectives started, Paul, Aneta and Daniel kept all of the clients from Barrett Berkeley, as well as adding some new ones to their client list. New clients were found by word-of-mouth recommendations, telemarketing and networking.
Paul says about networking: “We never had time to do it before, so we’ve got into a new scheme of networking in the evenings, going to networking sites and blagging free tickets here and there for business meetings... it’s been quite an eye-opener to see what’s going on out there”. Daniel is the company’s IT man, who link-hunts to find networking meetings and check client referrals out via search engines. 3Objectives has also started using social media and recently launched a new website.
Setting up in an era of spending cuts
3Objectives does not specialise in any one area of photography. Paul says: “To be honest, that’s our secret as to how long we’ve survived. We’ve all got our own specific specialities but I believe as a company we can shoot most things”.
Setting up at the end of a recession was “Scary. Really scary.” Especially, Paul says, given the current uncertainty surrounding the economy: “I hope it is the tail end but when you look at what’s happening in Europe you wonder if it’s the tail end or the beginning again.”
One issue, 3Objectives has found, is that it is harder to make new contacts because “It’s all about budget now. It’s harder to go out and sell. Some clients are looking for ridiculous prices but most are accepting that [our prices] are the market value now.
Paul also cites the shift from traditional to digital photography as something that makes finding clients more difficult. “There are always those people who don’t want to pay for photography and in the advent of digital photography they think that we do the same thing people do at home on a Sunday afternoon. It’s difficult, particularly for the younger generation, to understand photography as people did in the 70s, 80s and 90s.”
One of the key things people should avoid when setting up a business, according to Paul, is relying on friends. “Don’t listen to your mates – they’ll say to you ‘don’t worry, we’ll have loads of work for you’. They haven’t always – don’t rely on them to give you the work and setup a business.”
In his experience, the hardest thing when starting up was to carry on through administration. While this is unlikely to apply to many new businesses, Paul says: “They [the administrators] wanted to close us down when they were ready, whereas we wanted to keep going and get as much work as we could.” However, he found that the personal relationships they had built with clients while still operating as Barrett Berkeley helped – Paul says this is a perk of smaller business as you can get to know your clients better.
On the other hand, the best thing about setting up is “Doing it for yourself. Even though you’re not taking the reward at the beginning, and we’re on less money than when we started, we’re working towards something we want.”