Jola Cloud Solutions' Blog

Clear strategy

Jola was set up in 2014 with an SEIS investment, owned and managed by the team that built and sold Griffin Internet. The business was established as a channel focussed telephony provider. Jola has a strong focus on process automation as a key aspect of customer experience and this has enabled revenue growth with modest overhead increases. Early successes with M2M, and a clearly identified opportunity in a growing market, led to an early pivot to mobile data connectivity. Other key components of strategy are focus on intellectual property in the service offering, recurring revenue, a broad customer base, and customer retention. Clear articulation and delivery of our strategy was a key component of our Information Memorandum (IM) when we launched our investment process.

Key Performance Indicators

Jola is highly focused on KPIs and monitors them rigorously at both company level and for each staff member.  This is how we align company strategic objectives with those of our staff. Performance against these targets is a key determinant of staff progression and reward.

Establish a reputation

The Jola team, made themselves known to the investor market from the outset. This included building relationships with private equity, focussing on investors who understood the TMT market and, more importantly, wouldn’t baulk at high valuation multiples. We used trade publications, awards submissions and attended events where we might bump into investors and acquirers. That was how we first met BGF. We also built a relationship with analysts Megabuyte as a means of creating awareness of our strategy and financial performance.  Our golden rule was that we would only share revenue and EBITDA projections that we could achieve with certainty.

Financial planning

Jola operates a 3-year rolling financial plan. Our budget is the first twelve months of the plan, fixed at the start of each financial year, and the remaining 24 months provide a longer-term outlook. Having this 12+24 as an ingrained discipline made it easier to prepare the IM and is welcomed by investors. Setting achievable targets was fundamental as we knew that investors would look at the record of achieving budget. Our budget is shared with all staff, and we update them at monthly team meetings. We re-forecast quarterly for cash flow purposes and to measure if we are on track to achieve budget. The cash flow forecasting was especially important in the early Jola days. An advantage from having a realistic three-year plan meant that we could quickly assess the value of potential earn-outs offered by investors.

Transaction ready

From Day 1, Jola was set up to be ready for external investment with a particular focus on being paperless in every part of the business. We keep soft copies of our Intellectual Property, our key business processes, and our legal agreements. We used lawyers to review our customer contracts and service agreements before they went live. If we must deviate from our standard customer terms, we attach an addendum that clearly sets out the non-standard terms. We started our data room the day that the company was incorporated and used it to store our key documents.  We knew that an investor’s lawyer would review our legal documents thoroughly and that being transaction ready would make it easier for the management team to survive the due diligence process and have lower costs.

Understand your numbers

Financial due diligence is the most rigorous part of the investment process, and we knew that preparation is key. This involved producing a full management accounts pack every month, including income statement, balance sheet and cash flow, with analysis of performance and trends, including versus budget. This was supplemented by various KPI packs with both financial and non-financial measures that were discussed at a monthly board meeting, chaired by an experienced non-executive chairman. After the first couple of years, we elected to have audited accounts because we knew they would provide comfort to investors and ensure we were compliant with accounting rules. All of the above meant that we were match fit when financial due diligence reviewed our financial statements (current year, two prior periods and our budget and projections) and KPIs.

Why did we choose BGF?

During 2020 the shareholders decided to de-risk their personal financial investment by selling a minority stake in the business. We produced an Information Memorandum and ran a beauty parade with a handful of investors. We did not speak to investors that required a majority stake with control, as we wanted to keep control of Jola to take the business forward to a full exit. Although the business was ready for full scale due diligence, we were attracted by BGF’s lighter touch approach and that we could complete a quicker transaction with less distraction. We considered raising bank debt rather as an alternative to selling equity but, for tax reasons specific to our SEIS investment, this route wasn’t open to us. 

Finding the right investor isn’t always about the highest headline price. We took references on all potential investors with particular focus on those that could transact quickly, had access to funding and were unlikely to price chip as we neared completion. It is easy to focus on a headline offer but it is not the actual cash amount that the shareholders will receive. There are many additions and deductions to arrive at the final value and having the right advice in this area is essential.

Advice and managing the transaction

I joined the Jola team as part time CFO, mainly to prepare the business for external investment and manage the transaction, including writing the IM and setting up the formal data room. Every deal is different, and having in-house experience meant that we didn’t engage a third-party corporate finance advisor. To avoid unnecessary distraction for the rest of the team and to let them to focus on their day-to-day roles, Andrew (CEO) and I took on the bulk of the workload. This allowed us to over-achieve on our projections and avoid any difficult discussions with our investors.

Working with trusted legal advisors is critical, and price isn’t paramount. Based on previous experience, I introduced Jola to the team at Pinsent Masons, who helped us negotiate the legal and tax aspects of both transactions. From experience, I avoid working with advisors who need to prove they are the smartest guy in the room. However, we did run a competitive process to ensure they kept their pencils sharp.

Sale 

All the above meant that we were in good shape when we were approached by Wireless Logic. The due diligence was certainly deeper and more onerous, but we were well-prepared and were able to complete a relatively speedy transaction. Wireless Logic referenced very positively, and this was a key factor in our decision to start an exit process within twelve months of the BGF investment. It was pleasing to provide BGF with a strong return in a very short timeframe.

And finally

It has been an eventful and thoroughly enjoyable couple of years working with the Jola founders. The shareholders have had a great outcome and the business has found a great home.

Ronnie Smith, Jola CFO

It is very common for the channel to use APIs for both availability checking and for provisioning tasks such as setting up new services.  With fixed line broadband and leased line services then availability checking is usually a key first step for a reseller to collect a lead.  So, they may have a postcode checker box on their website that collects some information about the customer’s location before using an API to provide a list of services that are available all without any human intervention required on the part of the reseller.

I don’t think it’s an accident that Jola’s largest resellers transact almost exclusively using APIs.  Whilst we have arguably the most feature rich mobile connectivity management portal in the form of Mobile Manager, for many resellers they want to pull all that functionality into their own portals.  We decided right in the beginning that anything we develop into our portals should also be available via an API and that strategy has paid off.  Resellers can now perform the full lifecycle management of a mobile SIM card via an API including the initial provisioning, the in-life management and usage monitoring through to changing the tariff on a SIM card or even cancelling it at the end of it’s useful life.

If a reseller makes the move to using APIs then I think it’s important to think about consistency.  So decide which workflows you’re going to automate via APIs and ideally always use that workflow rather than sometimes using the API and sometimes using a GUI.  The reason is that it’s likely that your API workflow will be keeping data in sync between your internal systems and your suppliers’ systems.  So, if you don’t use that workflow consistently you can end up with a situation where your internal systems are out of sync that can lead to billing issues or confusion when it comes to providing support for that service.

I think API usage will be become even more widespread.  The massive adoption of the hyperscale clouds such as Amazon Web Services and Microsoft Azure is providing really powerful, easy to use and well documented API gateways that simplify the process of interacting with all kinds of different APIs.

Open APIs are in their infancy and I don’t think there’s a great example of their adoption within the channel today.  However the promise is clearly exciting and potentially could lead to the channel add a new layer of stickiness to some otherwise commoditised services.  For example, your mobile phone SIM card could have a set of open APIs that gave access to things like SMS history, call logs, data usage information.  Then an App developer could use those APIs to provide really in depth management capabilities into an easy to use App available from the App store.  Now, if your SIM supported those Open APIs but your competitor didn’t and your user valued the capabilities delivered by that third-party App then it’s unlikely they’d switch SIM provider to somebody that doesn’t have that capability.

The deal will enable Wireless Logic to consolidate its routes-to-market through a single, focused channel, serving VARs and dealers in the UK

LONDON, UK – TUESDAY, 12  JULY, 2022 – Wireless Logic, the leading global IoT connectivity platform provider has acquired Jola, the channel’s leading mobile data specialist, for an undisclosed sum. This agreement marks the latest step in Wireless Logic’s business expansion following a series of acquisitions for the UK company.

Headquartered in Nottinghamshire, Jola is a channel-only supplier of business communications, specialising in mobile data SIMs. Jola provides innovative IoT and mobile data solutions to managed service providers, internet service providers, IT support companies and telecom resellers, who provision, manage, and support thousands of SIMs through Jola’s own Mobile Manager self-serve platform. Jola’s expertise in the UK channel is highly complementary to Wireless Logic’s routes-to-market and customer base.

This partnership will deliver the scale and reach of the Wireless Logic Group whilst ensuring that the specific expertise, product innovation and quality of service continue to meet the needs of the channel. With the financial backing of Wireless Logic, Jola will be in the strongest position to continue its growth trajectory and exploit new opportunities.

The Jola team will continue to manage Jola partners.

Andrew Dickinson, CEO of Jola commented, ‘“Wireless Logic is one of the standout successes of the ICT sector and we have long been admirers of Oliver Tucker and his team. Jola will remain an independently-run company within the Wireless Logic Group, focussing as always on the UK channel, but with a global reach. The 1000+ Jola partners will see no change in the short term and over time they will benefit from product innovations across the group and more extensive supplier relationships. I would like to thank our customers, suppliers, and most of all the amazing team at Jola who have worked so hard to achieve this milestone.”

Good reward and recognition schemes can encourage the right culture to drive growth in a channel business. Working from home has highlighted a need for useful KPIs. Teams with the right measures in place have found that productivity has gone through the roof. Sales teams are able to fit in more calls, meetings and webinars. Companies measuring not only call and ticket responses but also online statistics, such as the number of webinars completed, have seen an increase in activity leading to a surge in orders.

I ventured into the office for the first time in a long time recently and I noticed just how different working in the office is compared to working from home.

Firstly there is no privacy. Alone in my home office, I can take any call or Teams meeting at my desk without being overheard or disturbed. In the office, you need to pre-book a meeting room to do this.

Secondly, there are a lot of interruptions in the office. People at your desk catching up, making coffee or pulling you into impromptu meetings. On the plus side, you do get to hear what is going on in other departments in real-time. There is an energy in the office which is positive, encouraging and welcoming. Challenges can be resolved very quickly with the right people around a desk in just a few minutes. You get a better perspective of what is going on across the whole business in the office. You can read people a lot better in person and pick your moment better.

In the heart of the office you can visually see the culture. 'Customer First' as phones are answered and emails replied to as a priority. The way the team collaborates to assist partners and support them. Training people from home has been great to a degree. We can teach the job, processes, and systems but culture is something that needs to be observed and absorbed I think.

I read a piece on LinkedIn recently which said that working from home can be damaging as you learn from others and it is easier to do this in an office environment working closely with experts.

I do find that I get a lot more work done at home, working longer hours with no travelling time and fewer interruptions.

At Jola, we have implemented a flexible working policy. Some teams choose to be in the office every day, others 3 days a week and some prefer to work remotely. We are aware of some of the benefits and challenges and hope we have found the right balance.

In a recent partner satisfaction survey, Jola scored a Net Promoter Score of 56, which categorises the company as ‘great’, with 41% of Jola partners giving them 10/10 and 96% scoring them 7 or higher. In the comments section, Jola partners praised Jola products, pricing, portals and service.

Andrew Dickinson, Jola CEO, commented, ‘I am delighted with our NPS. We now have over 1000 resellers and MSPs choosing Jola as their mobile data and intelligent connectivity partner. Our relentless product development continues with a long list of new products designed to help partners differentiate their offerings and win bigger deals. We have a fully redundant highly scalable IP edge network with DDoS protection from Cloudflare, and we continue to grow and invest in people, products, platforms and processes. We have a fantastic team here at Jola who are dedicated to supporting our growing partner base and it was great to see so many of them named in the survey by partners.”

Jola celebrated its 8^th birthday recently, after a year of growth that saw revenues surge by 80% and EBITDA double.

Jola also had its best year for signing new partners with ICT resellers, MSPs and specialists choosing Jola for their mobile data and intelligent connectivity.

Jola continued its relentless product development, with a string of new products designed to help Jola partners differentiate their offerings and win major deals from the mobile networks direct.

There are very few administrators and support staff in Jola, in fact despite doubling the number of Jola partners in the last 18 months to over 1000, calls and tickets into the company have decreased. We have obsessed over removing human intervention from all processes, and since 2016 invested millions in real-time automation and intuitive, white-label, self-service portals. More than 40% of our 50+ staff are employed in sales and marketing. Their objective is simply to help our partners win more business, and we recruit 15-20 new partners every month. 

A major advantage of our approach is that we can deal with resellers and MSPs of any size and we don’t need to sit behind companies trying to build a channel themselves. The mobile data market is competitive and there’s no reason for resellers to give up some of their margins to a third party whose only purpose is to compensate for the mobile aggregator’s lack of sales capability and automation.

Why is this such a hot topic at the moment and is it relevant to my business?

Have you ever had a situation where it was critical to hire a new person and you struggled to find them in time? Maybe you only received a few CVs and the ones you did interview were not up to the mark?

We needed to hire new marketing recruits at Jola. We attracted over 100 strong applications. What did we do differently?

Firstly we looked at our job advertisement and test-marketed the copy with people we knew would be great for the job. We found out through this process that we were putting off our target audience with the way we were describing the company. We were missing the opportunity to sell things we can offer candidates that other businesses recruiting similar roles couldn’t. We were putting up entry barriers by using jargon and insisting on very specific experience.

We not only changed the language and tone of our advert, but also added salary details, benefits and described what it is actually like working at Jola. We highlighted the career development potential, training and mentoring available and refocussed our copy on the values we were looking for. We looked at challenges faced by working parents, we looked at day-to-day challenges, getting to work, hours of work, place of work and made some significant changes.

All employees can work from home and no longer need to work 9-5. Our entire marketing team works part-time hours around their children. It is acceptable to take time off or work remotely to solve problems at home. We promote our inclusive culture. We encourage all types of diversity welcoming employees with neurodiversity and from the deaf community. We benefit from the complimentary skillsets which help drive the business forward.

Jola celebrates its 8^th birthday in April 2022, after a year of growth that saw revenues surge by 80%, EBITDA double, and an investment from BGF that valued the company at over £40m.

Jola also had its best year ever for signing new partners with over 1000 resellers and MSPs now choosing Jola for their mobile data and intelligent connectivity.

Jola also continued its relentless product development, with a string of new products designed to help Jola partners differentiate their offerings and win major deals from the mobile networks direct.

Apart from innovative Layer 2 LTE offerings for ISPs and unique big data tariffs, Jola built a new, fully redundant, highly scalable IP edge network specifically designed to deliver high performance and secure mobile data services. Jola Partners’ critical services now enjoy protection from DDoS attacks and super-high speeds globally via the Cloudflare network. Cloudflare’s 121 Tbps worldwide network blocks an average of 86 billion threats per day.

Andrew Dickinson, CEO of Jola commented, “We have just closed the books on our seventh full year and won Megabuyte’s Emerging Star award for the Best performing Telecoms Services company for the second year running. We continue to grow and to invest in people, products, platforms and processes. We have a fantastic team here at Jola who are dedicated to supporting our growing partner base. It is great to see so many Jola partners building profitable revenue streams from our unique mobile data solutions.”

Recurring revenue businesses rely on customer acquisition and retention. It is tempting to focus all efforts on recruitment, but churning customers is a real concern for growing businesses.

Understanding and monitoring customer experience, can help to identify early warning signs, put in measures and reduce churn. By improving the customer experience, you can increase customer retention and revenue per customer, whilst also enhancing brand perceptions in the marketplace. By getting this process right, you create ‘fans’ of your business, ‘advocates’ who freely recommend your services to others and buy frequently from you.

In order to measure customer experience, you must first identify relevant KPIs. What are the measures in your business of customer satisfaction? Many companies use NPS (Net Promoter Score) which gives an overall satisfaction score. You ask the question: How likely are you to recommend us? You use an answer scale of one to ten. You may also want to ask more granular questions to understand satisfaction across each customer touch point.

Next think about what influences the satisfaction score. This can often be obtained through a comments box on your survey, or by calling a cross-section of clients to ask specific questions about their experience. Having the right products, at the right price, on the right management portals, is key, combined with excellent service and accurately and timely billing.

By surveying customers regularly and gathering feedback, you can identify any shortcomings and work with customers to improve them. Going the extra mile to fix a problem can save a churning customer, but when handled well, also turn them into an advocate.