Digital Origin ranked 31st in this year’s Oxygen Fast-Growth 50 after trebling headcount to 27 inside three years.
Find out more about the Fast-Growth 50 here.
Digital Origin’s inclusion in the report offers two growth stories for the price of one. Stephen Richardson CEO explains why
How did Digital Origin start life?
The business started in late 2018.
The founder’s previous business had been bought by Six Degrees. [Six Degrees] were trying to consolidate mobile, telco and connectivity with IT. Although he supported the model, they were aiming at the enterprise space and he couldn’t see how that would work and felt it was more a model for going into SMB. Digital Origin was founded off the back of that.
The best way to get into that space is through the IT MSPs. They are the most trusted partners. If you look at where businesses put their trust, the IT partner is the top of the tree, and then it goes connectivity, telco and – finally – mobile.
So the idea was to go out and buy IT MSPs and then cross sell those services into those businesses.
Through the course of 2019 to 2023 we bought four businesses. They were IT businesses which weren’t doing anything in the other spaces, which gave us clear headroom to cross sell. The key was onboarding them all onto one platform quickly and cleanly.
I came on board as Commercial Director at the end of 2020. We grew quickly, and not just through acquisitions. Mostly through cross-sell, we were growing at 25%-plus excluding those additional businesses, which proved the model.
Why did you sell up to Evergreen last year?
Going back to 2023, we’d financed everything prior to that through private debt. But we had a couple of acquisitions lined up for 2024 which were quite a bit bigger. Typically, we’d bought below £1m EBIT. The ones we were looking at were £1m-£2m EBIT.
So we went out to the market to get funding. That’s when we unintentionally bumped into Evergreen, who opened up a totally different line of conversation in terms of selling the whole business.
How does being part of Evergreen work?
The key to the Evergreen piece is that they have a decentralised model. Evergreen itself has set up a business called Lyra Technology, which is an IT MSP-owning business. All they’re looking for Is growth in that MSP space – they’re not looking to centralise it.
They are 100 MSPs across three continents, predominantly in the US, but they have a piece in Australasia as well. And then the UK is up and coming.
The idea is to buy the best breed in those regions to then keep performing.
Securing the Evergreen backing allows us to keep growing. We don’t change our name, or any of our people – we just keep going on that journey.
We’re going to look in the short term at organic growth. I wouldn’t say acquisitions are off the table – it’s just that Evergreen are obviously looking in that same pond to acquire.
We were their second UK acquisition in March 2024. They’re now up to six in total [The Final Step, Digital Origin, ITBuilder, Certum, CIS and CMS Group]. They want to get to the end of 2025 with 20 to 24 businesses in the UK.
Do you have a relationship with those other five UK Evergreen/Lyra businesses?
Yes, in a couple of ways. We’re the only one with that cross sell piece – the connectivity and the telco. We’re offering that out across the group, which allows them to generate more revenue. And then one of the six businesses is very heavily into Power BI and Power apps. Being able to lean on them gives more value to our clients.
Do you expect to continue hiring this year?
Our current headcount is 54-55 and we’ve got five vacancies rolling out in the next quarter.
The founder exited and I was appointed to start the CEO role in January, with quite a different viewpoint of how we’re going to grow going forwards. Before, we ran account managers across our base because we wanted to look after our incumbent clients. They have a very different mindset to someone in sales who’s finding new business. We’re now looking at sales people as well as those account managers.
What role does automation and AI play in your expansion plans?
Our ‘BHAG’ [big, hairy, audacious goal] is to be a £30m business by 2030. We’ve mapped out that five-year plan, and actually, our service desk doesn’t get much bigger. It will support three times the size of business with the same amount of people because of that AI piece that will come into it.
I want to upskill my team. The pyramid at the moment is ten Level 1s, eight Level 2s and five Level 3s. I’m going to flip that pyramid upside down, as AI will do a lot of that.
