Parents despairing of aimless teenage offspring can take comfort from Simon Nixon’s tale. University drop-out Nixon, 39, went on to found the price comparison website, Moneysupermarket.com. Despite its disappointing stockmarket debut last week (market turmoil saw its shares list at 170p each, far below the 210p that had been hoped for), Nixon’s sale of 60 million shares netted him £102m and he remains a controlling shareholder.
It’s down to two decades of hard graft. At 20, Nixon left his accounting course at Nottingham University: “I hated it. It was boring,” he told Louise Armitstead in The Times. A job selling pensions and life insurance was just as tedious, so he “decided to specialise in mortgages”. Within months he had spotted a gap in the market. There was no easy way for brokers to compare all the mortgage deals available. So he spent “every night and every weekend” setting up a magazine publishing best-buy tables.
“I sent them out free and then got subscriptions for £11 a fortnight.” It was a hit, and by 1989, just two years later, it was earning him £10,000 a month. As computers gradually became vital office tools, he persuaded 18-year-old Duncan Cameron, brother of his then-girlfriend, to quit his IT course at Liverpool University and join him. They formed Mortgage 2000, which allowed brokers to check listings by computer daily rather than fortnightly. But it was the 1999 launch of Dixon’s free internet service provider Freeserve that gave Nixon his crucial brainwave. “I thought, wouldn’t it be great if retail customers could compare mortgage deals, and other prices?”
Moneysupermarket.com launched later that year, and grew fast. The firm charges commission every time a site user takes out a financial product with a firm in its best-buy tables, ranging from 30p for an insurance policy to £30 on a mortgage. With four million users, it rapidly adds up. In 2006, the group made pre-tax profits of £11.7m on revenues of £105m.
The idea of floating had been around since 2004, but a falling out between Nixon and Cameron made it impossible. In what Nixon has described as “the worst deal I ever did”, he gave Cameron half the business in return for coming on board. The source of the discord remains unclear, but it seems corporate financiers trying to strike a deal naturally turned to Nixon as managing director, sidelining Cameron.
Five years ago, Cameron stopped coming to work, but was still paid millions of pounds in dividends. This presented a serious problem. Every flotation detail had to be agreed by the absent Cameron. But last month, Nixon finally cleared the way, buying the bulk of Cameron’s shares for £162m. He remains enthusiastic, says Ben Bland in The Daily Telegraph. He says that Moneysupermarket.com is “only scratching the surface. Only 15% of people have bought a financial product online.”
His recent ‘Making Millionaires’ venture has plenty of potential: revenues rose 54% last year to almost £105m.