Second time round for 2 Circles team

2circles2 Circles may be a new name in the comms industry but its directors have already built one successful switchless resale operation. Now, they're doing it all over again.

In the late 90s, Managing Director Steve Cook, Sales Director Steve McConnell and Operations Director Andy Reid led a team that successfully sold network minutes. "We were pretty good at it," says Cook. "In fact, we were writing £40k a month in new business and were the largest dealer in the country. But no matter where we sourced our minutes, we never got the customer service we deserved, like many dealers we were rarely paid on time, didn't get the reporting transparency our business needed and couldn't guarantee to get 95 per cent of our signed order value live."

If that sounds hyper-critical, remember that this team has worked together for 14 years and each one is firmly grounded in running specialist sales teams. "We probably came at telecoms from a new angle," says Cook.

"Previously we had a business with 500,000 customers handled by 300 sales people. We took aerial photographs and sold them door-to-door through teams in both the UK and USA. The downside was that there was no recurring revenue and low cloud would keep Biggles on the ground. Telecoms seemed to match our ambitions exactly. The only problem was the service we were getting. To change that, we set up our own reseller company called Ecocall at the end of 2001. We knew what it was like at the coalface so it didn't take a great leap of imagination to position ourselves as the Dealers' Reseller. It worked. Starting from zero in 2002 we hit £1.3 million a month in 2007."

Growth was wholly organic with no acquisitions. The company's success prompted Opal, the B2B division of The Carphone Warehouse, to buy the company in 2004 and the three directors stayed on board. "We completed our earn-out period in 2007," says Cook. "But we all share two characteristics. We like working together and we like working for ourselves. So we approached Opal with the suggestion that it became our supplier and we ran our own business, effectively starting again from scratch. The idea was accepted, so we then launched 2 Circles as the only company enjoying this kind of relationship with Opal."

Since starting once again with another clean sheet in April of this year, the company had billed £2 million in just four months. The reason, Cook insists, is the depth of its focus on one-on-one account management. "A customer deals with one person and doesn't have to punch out number options to reach a recorded message. Our account managers create a genuinely personal relationship and manage it without voicemail. Quite simply, we get the simple things right and lead the sector with a churn rate that has averaged 0.83 per cent over the last four years. Account management, however, is only part of the story. We offer exceptionally attractive landline, broadband and mobile packages sourced from Opal. But we're not totally tied. Our hosted Blackberry product is offered in partnership with the biggest provider in the USA.

"We have also pioneered WLR3 and are one of only four resellers included in the independent report commissioned recently by Openreach, accurately, if clumsily, titled, ‘What you need to know about WLR3 from the people who are providing access to it'. Importantly, too, we have worked with Opal to pioneer the development of LLU products for SMEs, and can offer both LLU and a wholesale mobile proposition to resellers."

Running through the core of the 2 Circles ethos is the ideal of fairness. "It's the Golden Rule," commented Cook. "Do as you would be done by. For our dealers it means paying them precisely when we promise, paying growth bonuses, giving full ongoing commission and guaranteeing up-front exit bonuses. It also applies to our people. When we started over we kept our 35 strong payroll intact. The logic was simple - skilled account managers were our capital and all we were doing was what we were doing before, creating a successful business. You don't let people go who have looked after a dealer who has built up a monthly billing of £180k from a standing start," he added.

Will the 2 Circles team be able to do it all again? There's an air of confidence around Cook when he says that revenues will once again hit £1.3 million a month by the end of 2010. He looks as though he'd be genuinely astonished if 2 Circles didn't make it.