Creating a profitable entrepreneurial track record
Founder and CEO Marc Worth sold his previous company WGSN in 2005 and came away with the best part of £55m. “I took a few years out, just enjoyed life, and then in 2009 I decided to do it all over again,” he says.
Stylus’ innovation research and trends content helps businesses process global consumer lifestyle, consumer product and consumer engagement insights, focused on stimulating innovation and growth.
With offices in New York and London, Stylus employs around 100 people including industry analysts, trends experts, researchers and client services staff. It also works with specialist freelancers.
Navigating the winding road to success
It would be tempting to say that Worth has the Midas touch, with success following at every step of his entrepreneurial journey. But the road to success has not been without its white-knuckle moments.
While scaling WGSN, Worth says he put everything on the line: “We were burning around £400,000 a month and my wife thought I was really reckless.”
But the company soon became cashflow-positive and Worth, along with his co-founder and brother Julian Worth, was able to buy out their investors. In 2005 the brothers sold the company to EMAP for £140m.
After about four years, he was ready to do it all again. But while writing a business plan with the view to raising start-up capital, he changed his mind about seeking investment. “I didn’t see the point of asking for venture capital because I had the cash sitting in the bank. So I decided that I might as well just fund the business myself,” he explains.
Every advertiser in a Hearst publication, whether for cars, fashion or beauty was a potential client for us.
Marc Worth, Stylus
Maintaining skin in the game
In 2009 Worth put up £10m of his own money to start Stylus. Just three years later the company was generating between £2m to £3m in annual revenues. “At the time I was definitely not looking to raise money as we were pretty much breaking even,” he says.
But this changed when media group Hearst approached Worth. The media giant owns Esquire, Elle, Cosmopolitan and Men’s Health among other leading magazine brands. Its small investments division Hearst Strategic Investments wanted to back Stylus.
Worth debated the merits of accepting investment and ultimately decided they could add value. “Every advertiser in a Hearst publication, whether for cars, fashion or beauty was a potential client for us,” he says. “I thought strategically that the investment could signal real opportunity for Stylus.” Hearst acquired a 20% stake in the business.
Generating high renewable revenues
Today Worth retains majority control of the business and says that Hearst is a “very easy” investor to work with. “They know the market we are selling into, but they’re happy to leave me to it,” he says.
Stylus is growing at about 30% year on year and crucially the company’s client member renewal rate is 84%. Though delivering such positive performance, Worth still sometimes toys with the idea of raising money, but is yet to be convinced he needs to.
The one factor that would sway him would be finding a “really interesting acquisition”. That, he says, would be a good reason to seek acquisition funding.
But for now, he says: “Stylus has a very high renewal rate and next year we’ll probably generate as much cash as I would have wanted to raise.”