Barinder and Dilshad Hothi: Launching a start-up with your spouse

Dilshad and Barinder Hothi combined their skills to set up their educational family firm, The Knowledge Academy.


Barinder and Dilshad Hothi started The Knowledge Academy

One of the most difficult aspects of becoming an entrepreneur is giving up a salaried job for the uncertainty of "being your own boss". It took a near-tragedy to convince Barinder and Dilshad Hothi that it was time to "stop slogging out our guts for other people".

In 2008 their daughter, Amrita, developed pneumonia and both parents "downed tools" to spend time in hospital while she recovered. This made them realise that they wanted something that would give them more flexibility.

So, in 2009, they set up The Knowledge Academy to provide training services to firms and local authorities. They covered the set-up costs by drawing on savings and re-mortgaging property they owned, and have continued to expand since without taking any external funding. Indeed, to this day the company does not have an overdraft.

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Barinder is proud of this self-sufficiency and thinks that their shared Indian heritage has encouraged them to adopt the attitude of "if you can't afford it, don't buy it".

The couple's biggest challenge was acquiring customers in an industry with many competitors. However, despite being the new kids on the block, they were able to use the contacts they had gained from their previous jobs in IT and marketing to win business.

As a result, they "hit the ground running", quickly building a large customer base, spread around a wide range of firms and courses. This meant that they have avoided becoming too dependent on one particular client or event, a trap that snares many small businesses.

The Knowledge Academy's "whirlwind" expansion was so fast that it came with its own problems. Barinder says that they initially found it difficult to find enough high-quality people to join them, especially when other firms could offer more job security.

One factor that proved crucial in attracting new staff was the fact that the couple insisted on interviewing all potential employees themselves. This was unique in an industry where it is still "very unusual for potential members of staff to meet with a senior person before being hired".

While there wasn't one deal that could be considered a tipping point, Barinder recalls that, not long after starting, they contacted a rival about doing a course together, only to be rejected for being "too small". Later on, the rival hit a rough patch and ended up being acquired by the Hothis in October 2011.

Today, The Knowledge Academy's revenue is on course to reach £35m and the couple plan to expand this to £100m within the next three years. This will involve moving into other related areas, such as recruitment, technology and even commercial travel.

Many people might be uncomfortable with the idea of going into business with their spouse. However, Barinder is a big fan of family firms, believing that they provide the "trust and loyalty" that is vital to any commercial partnership.

On a personal level, she says Dilshad's "ambition and creativity" sits well with her focus on execution and reducing risk. The couple enjoy working together so much that they consider their work "more a pleasure than a chore". Indeed, "we don't have any rules about not talking shop at home, because if we did they'd be broken as soon as they were made".

Dr Matthew Partridge

Matthew graduated from the University of Durham in 2004; he then gained an MSc, followed by a PhD at the London School of Economics.

He has previously written for a wide range of publications, including the Guardian and the Economist, and also helped to run a newsletter on terrorism. He has spent time at Lehman Brothers, Citigroup and the consultancy Lombard Street Research.

Matthew is the author of Superinvestors: Lessons from the greatest investors in history, published by Harriman House, which has been translated into several languages. His second book, Investing Explained: The Accessible Guide to Building an Investment Portfolio, is published by Kogan Page.

As senior writer, he writes the shares and politics & economics pages, as well as weekly Blowing It and Great Frauds in History columns He also writes a fortnightly reviews page and trading tips, as well as regular cover stories and multi-page investment focus features.

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