The entrepreneurship of sole practice

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As part of economia enterprise week, we speak to a sole practitioner about going it alone as an accountant

If Simon Bruce’s working life has a theme, it’s probably curiosity about what makes the world go round. It’s the reason – plus a dash of youthful arrogance – that he went into accountancy in the first place and the motivation behind an entrepreneurial career that has taken him from banking through to international business and more recently into consultancy and sole practice.

“When I was 21,” he recalls, “I remember walking from my college back to my lodgings on a particularly wet February evening wondering what it was that I didn’t know that was important in the world. And I came to the conclusion that I knew nothing about commerce, money, the economy, industry. So when I was thinking about what sort of career I wanted, I decided to train as an accountant.”

He found learning about double entry book keeping and audit “pretty dull” but realises that his three years at Binder Hamlyn (now BDO) gave him unparalleled access to a wide range of businesses. His first audit was with commodity traders in the City (“I didn’t have a clue what was going on”), his second an abattoir in Somerset. Yet, despite the experience, he felt his question hadn’t been answered: “Even when I got the qualification, I asked myself did I really know how money was made? By then, I knew how it was counted, but not how it was made.”

Before I knew where I was, I had a halfway decent practice

Simon Bruce

The quest for knowledge led him via a short stint at engineering group Hawker Siddeley into investment and then private banking where he discovered how to structure products to please clients. “Accountancy training is a foundation course, albeit rather advanced. There are lots of things it doesn’t really teach and it doesn’t give you tricks up your sleeve.”

Leaving the City

But it was only when he moved out of the City bubble to Bristol and to a job as group finance manager at Pasminco Europe, a large international metals manufacturing and trading business part owned by Rio Tinto, that he felt he was getting somewhere closer to the answer. It was his dream job – working for a global business headquartered in Australia with operations in the UK, Australia, North and South America, at a time when China had not yet become the world dominating influence in commodities.

Within two years, Bruce was seconded to Brisbane as part of an international strategy team where he learnt the importance of the marketplace and the role of marketing in running a business. “I also started to understand how to assess whether you had a hope in hell of making money out of an idea. I got the bug for consultancy.” When he returned to the UK, he got involved in purchasing and arranging delivery of raw materials from international mining and trading companies, skills that he put to good use when he was made redundant in 2003.

“The business closed down and the landsite in Avonmouth was sold off for a nominal sum to brownsite developers even though it had £hundreds of millions of environmental liabilities. I knew that if I could extract the surplus materials that had been left there, I could sell it on. So I set up Materials Resource Management Ltd.

“Over the last eight to 10 years, we’ve shifted 100,000 tonnes off the site to smelters overseas . It’s true when they say where there’s muck, there’s brass.”

Life has not been quite so plain sailing since 2008 when the financial crisis hit and bank lending went into freeze mode. “Commodities are great if you’ve got huge backers,” Bruce says, “but for a one-man band it doesn’t work. I realised I needed another string in my bow.”

Going it alone

What better to do than to go back to his original training, add in all the skills and marketing knowledge he’d acquired along the way, and set up as a sole practice? He brushed down his qualification, attended a number of updating courses and in 2009, Virbix Ltd was born.

“I started to talk to friends who were either entrepreneurs or involved in small businesses and one or two said they were happy to give me work. So I rented a small office in a service block and before I knew where I was, I had a halfway decent practice.

“It’s not decent enough yet though. I was only able to do it because I was running MRM side by side. I knew MRM would die off at some stage and it’s nearly there now.” He also works as a part time finance director advising small clients who need a financial expert but can’t afford one full time.

Being a sole practitioner is hard – long hours for comparatively low pay. The average annual income after tax, expenses and fixed costs is around the £25,000 mark. “When you’ve worked for 30 to 35 years and you’ve got all this experience to offer, it’s a bit miserable,” Bruce admits. “Whether it is worth being a sole practitioner is quite a difficult circle to square in your own mind. You’ve got to get involved in other things as well which is what I’ve been doing and will continue to do.”

As well as building up a niche market for Virbix in the media sector in the Bath and Bristol area, Bruce is bringing his entrepreneurial, marketing and consultancy skills to bear in a new business project that has the potential to attract a wider target audience. He has teamed up with a marketing and advertising consultant to create Bruce Hall Management Strategies.

“What we are aiming to do is mimic that model I saw going on when I was involved in the strategy team in Australia, which is putting people together from marketing, financial and operational backgrounds to work on projects to create change within a client’s business. It’s nothing to do with reporting: rather, it’s to do with creating something of value for the client.”

Bruce may not have discovered the complete answer to the question he asked his 21-year-old self. But he’s certainly learnt a lot along the way and he has no regrets about becoming an accountant. “It’s given me some amazing opportunities – standing on the top of a mountain in the Andes looking at mines or hanging out in some South American port learning about shipping. These are all one-off lifetime experiences.”

As for the future, he does worry sometimes about his ability to slow down. But at heart he is an entrepreneur who simply finds doing business “a fantastic human activity”. “No other animal species does it. It’s unique to human beings and the way that we create these institutions is absolutely fascinating. It says so much about human ingenuity.”

 

Julia Irvine



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  • Comment by Anonymous

    £25k is not so bad, I started my practice in 2010 and my GROSS fee income is £3,500 for the most recent 12 months. I spent some years both in Deloitte and PWC Steve BSc, FCA,CTA

  • Comment by Mike K

    Frankly, I'm staggered by the £25k average net income, which is less than I earned at a (then) Big 6 firm as a newly qualified in 1994. Frankly I'd be concerned about receiving business advice from someone that earned that little! I suspect that some of these guys are simply semi-retired and topping up their pension income. Following a mixed career in Big-4 practices (business recovery) and business banking, I've been on my own for 3.5 years and am now well into six figure income levels (net), so it's not always bad out there for those thinking of going it alone.

  • Comment by Stuart Jones

    We, the ICAEW (members and senior staff) should be ashamed that "The average annual income after tax, expenses and fixed costs is around the £25,000 mark." How on earth have we allowed ourselves to become so undervalued?