In 2006, it was hard to miss the headlines proclaiming the sale of the energy comparison site uSwitch.com. The sales garnered vast levels of attention for a number of reasons, namely the fact that, within just 6 years, it had grown to become one of the UK’s largest energy comparison sites. The company was sold to the American media firm E W Scripps with a whopping £210 million price tag.
There are plenty of tales of firms that have reached such meteoric success, but for a company to rise from a £4 million investment and to be sold for over £200 million within such a short period is almost unheard of.
The company was founded by the 4th Marquess of Milford Haven, George Mountbatten. George is a cousin to the queen and, at the time of the sale, was estimated to hold just under half the company. However, the success of uSwitch.com can in no way be credited to him solely as, in fact, he built a strong team of directors who were all integral.
Among them was Vipul Amin, who was a founding shareholder and began the business in the midst of a deregulated UK energy market. By that point, Vip Amin had already built himself a notable reputation as a serial entrepreneur, and swiftly took up key management duties and a healthy shareholding in the company.
A simple yet powerful idea
From the start, uSwitch.com was poised to be extremely popular as the recently deregulated energy markets were still dominated by firms offering prices well in excess of what they should be. The model set out to provide clear information to UK households and allow them to find the best price available.
What set them apart from the competition was the way in which the company generated revenue. Instead of charging consumers a commission or allowing companies to buy their way through the rankings, they simply charged certain suppliers a fixed fee for every new customer they sent their way,
This simple yet powerful formula, designed by Vip Amin, George Mountbatten, and CEO Andrew Salmon, was a win-win for all parties. Consumers were able to get the best rates free of charge, utility suppliers paid a small fee for a long-term customer and uSwitch.com pocketed that small fee for bringing the two together. It sounds simple now but, at its height, the company had a 42% market dominance.
As uSwitch.com was a private company, much of the financial data regarding the sale is restricted to private parties, though Vip Amin was amongst the 9 shareholders benefiting mainly from the sale. With a sale price of £210 million, regardless of their holdings, it represented a sizeable return for all investors.
All staff, and there were around 100 at the time, were also rewarded for their sizeable contributions by receiving a portion of the sales.
Though not the founder, Vip Amin was involved from almost the start as Finance Director right up until the end, acting as a key advisor in the sale. At the end of the 20th century, investors were hit hard by the burst of the dotcom bubble, so it makes uSwitch’s rise to fame all the more momentous.
A lasting legacy
To this day, uSwitch.com still represents a sizeable force in the world of energy comparison services, and the range of features and services being offered has grown since the sale. It also marked a revolution in the way that consumers search for products.
Nowadays, there are comparison sites for everything from car insurance to mobile phone providers. It’s hard to imagine a world in which consumers didn’t feel in total control of what they purchase, and uSwitch has a key part to play in that.
Vip Amin has again joined forces with Andrew Salmon and George Mountbatten, launching a similar enterprise in Turkey. This new company, EnCazip, serves to provide Turkish consumers with a similarly useful service as to what UK citizens received. With a winning team and a recently deregulated energy market, Vip Amin could be
poised to replicate the same success it achieved just a decade prior.