Thursday 28 April 2022
Business/A view from the top

‘I still think of myself as a builder from Portsmouth’

Turnaround king Andy Scott has built a thriving business again after losing everything. He talks to Heather Martin

<p>High flier: Scott’s REL Capital is projected to turn over £40m this year </p>

High flier: Scott’s REL Capital is projected to turn over £40m this year

(Murray Sanders)

Andy Scott is 6ft 4in, tanned, with dirty-blond hair, blue eyes and a direct gaze. You wouldn’t exactly mistake him for Alan Ritchson, the guy who now embodies Lee Child’s legendary hero Jack Reacher on screen, but the resemblance was definitely there. And like Reacher, Scott is a guy who likes to put things right. If something is broken, he sets about fixing it.

He puts it modestly. “I come from a family of doer-uppers. I still think of myself as a builder from Portsmouth. I just love projects.”

Softly spoken serial entrepreneur Andy Scott is the UK’s self-styled turnaround king, taking firms on the verge of bankruptcy, investing in them, and safeguarding hundreds of jobs. He employs close on 500 people at REL Capital, founded in 2017, and turnover is projected to hit £40m with recovery from Covid and new acquisitions this year. “I’m not an asset stripper,” he hastens to clarify. “For me it’s all about people and preservation.” Scott partners with the management teams of failing companies “to steer them to calmer waters before turning them back to profit”.

The nautical metaphor is on point. Scott was born and bred in Portsmouth, and grew up messing about on the Solent. “I call it the theme park down there.” He’s driven fast cars and flies his own plane (“a small six-seater”, bought for convenience during Covid), but boats are where his heart is. He inherited – or rescued – his first boat at the age of 14, from a retired naval commander who was about to scrap it, until Andy stopped him and set about restoring it himself. Among his recent acquisitions is a 32m superyacht called Elton, after his lockdown baby son (he’s a big Elton John fan, citing “Tiny Dancer” as a favourite tune). He’s done a couple of trips across the Atlantic, enjoying the mental as much as the physical challenge. “You learn a lot about yourself.”

When I visit a failing company, I have empathy for the owner. I understand why they are not sleeping, worrying about losing everything

Scott’s father was in the Royal Marines and played clarinet and saxophone in a military band, but it was from his bookkeeper mother, who brought him up, that Scott got his feel for numbers and restoring old things. He got his entrepreneurial mindset from her market-trader boyfriend. He went to a choir school on a music scholarship and as a teenager played the organ at weddings and funerals. Otherwise he was “a bit of a tearaway”, more streetwise than scholarly, and always more interested in business. He enrolled to do Maritime Studies at Southampton University – living on his boat and working as a bouncer four nights a week as well as running a small hotel – but dropped out to work full-time as a builder. Then, with a £5,000 inheritance from his grandmother, he bought his first property: by his mid-twenties he had renovated over 500, and made his first million. “I always loved earning and learning on the job.” The plane was about self-improvement too: “I’ve done my instrument rating, which is quite academic, so can land in any weather, which is essential in the UK.”

Scott was in the States when the 2008 financial crisis hit, midway through a leisurely round-the-world cruise with a bunch of friends, paying a crew he couldn’t afford, putting the marina fees on his credit card. “I’d never seen an economic cycle before, and my business went bust. I was leading a debt-fuelled life: the banks are throwing money at you, and you think great, this is never going to stop. I lost a group of hotels [and thereby the roof over his head] and got wiped out. It was a really horrible time.” Then things went from bad to worse. “I got run over by a taxi in Washington and broke both my legs. Depression set in, but it gave me the kick up the backside that I needed.” He returned to the UK in a wheelchair and spent a year sleeping on friends’ sofas. Eventually, he went back to the building site to start over. “Which was tough, because people knew you’d built up a good career, then there you are labouring. But there’s no alternative. You’ve just got to get on with it.”

It took him two years to shake off the depression and six to recover financially. But the banks wouldn’t lend him money any more: “they give you an umbrella, then take it away when it rains”. He relied on private borrowing to initiate new projects, taking over old cinemas, and even a church, to set up bars and clubs. The music side of it was fun. “House music in an amazing venue with hundreds of people …You get a real buzz. It’s nice to see.” For a while, he even ran the nightclub at 1 Leicester Square. But it wasn’t really his scene – just a means to get back on his feet.

<p>All aboard: Scott recently purchased Redwing Coaches, a casualty of the Covid era </p>

All aboard: Scott recently purchased Redwing Coaches, a casualty of the Covid era

(Mark Barnfield)

Scott thinks we have the wrong attitude to failure. Rather than a big black mark forever chalked up against the name of the individual, he believes we should see it as a potential strength: what matters is not that you fail, but how you pick yourself up again. Scott considers himself a better person for the troubles he’s been through. “When I visit a failing company, I have empathy for the owner. I understand why they are not sleeping, worrying about losing everything.” Crucially, he understands the value of a helping hand.

We perceive a rundown house on the brink of ruin as a thing of value, of beauty even, as something worth saving, an opportunity. It seems self-evident to Scott that we should view a struggling business in much the same way. There are human stories, and perchance human suffering, at the core of both. On what grounds do we cherish one and despise the other?

It’s no surprise to discover that Scott is drawn to family firms. The inheriting generations don’t want the legacy to be lost on their watch, but lacking the founder drive, often need “a boss” to steer them. “Customers buy into family businesses; it’s a great marketing tool. Especially with coaches, people taking your kids to school. You want a human face.”

If there was someone like me around when I lost my hotels, I wouldn’t have had the horrible six or seven years I’ve had

Scott now owns a portfolio of SME businesses across the recruitment, hospitality, property, and transport sectors. The partnership model means REL Capital assumes 80 per cent ownership, with the original management teams retaining 20 per cent, along with the company name, existing salaries and benefits. If the business “is too far underwater”, they start afresh on the same terms. Mostly it comes down to relationships. “We can’t run your business, we tell them, because we already have 10, but if we like you and think we can work with you, we’ll act as your long-term partner and support you through any restructuring. It’s win-win. I think we’re the only ones doing that.” The previous day he had completed on the purchase of Redwing Coaches, now REL Redwing, a casualty of Covid thanks to the simultaneous loss of school contracts, private hire bookings, and tourism. “Fifty-five coaches at £250K each adds up to monthly finance payments of £150K. It’s crazy if you’re just sat there.”

“If there was someone like me around when I lost my hotels, I wouldn’t have had the horrible six or seven years I’ve had,” Scott says. “I just want to shout out to people who are struggling. A lot of people don’t know there’s another option out there.”

Scott is still a south coast guy, even if these days he’s more into the Mediterranean. He’s doing up a house between Cannes and St Tropez, brushing up his French, and looking forward to salvaging his skills on the piano. “I’m happiest on the sea, but it’s cool doing a run to the tip, too.”

He looks out the window of his second floor office. “It’s great to have everyone walking around. Two years of seeing Carnaby Street with no one about is pretty sad.” The city, so long becalmed, was up and running again.