Riding Unicorns

S3E16 - Tom Leathes, Co-Founder & CEO @ Motorway

March 23, 2022 Riding Unicorns Season 3 Episode 16
Riding Unicorns
S3E16 - Tom Leathes, Co-Founder & CEO @ Motorway
Show Notes Transcript

Tom Leathes is the co-founder and CEO of Motorway. Launched four years ago by Tom and his long term friend and business partner Harry Jones, Motorway is harnessing the power of technology to deliver an amazing experience for customers looking to value and sell their car. In the four years it has been operating the company has already helped over 2.5m customers resulting in 300% year on year growth.

Riding Unicorns were lucky enough to sit down with Tom and pick his brain on several topics including the motivation behind Motorway, which we go on to learn was fuelled by failing with a previous start-up. Tom goes on to explain how his role in the business has changed since it has scaled, how the team was able to develop its MVP and why customer satisfaction will always be his and the company's number one priority. We close by exploring Tom's qualities as a founder, what advice he would give to his younger self and his plans for the future. 

Make sure to like and subscribe to the Riding Unicorns podcast to never miss an episode. Also don't forget to give Riding Unicorns a follow on Twitter and LinkedIn to keep on top of the latest developments.

James: [00:00:00] welcome to riding unicorns. The podcast about growth startups. I'm James Pringle and I'm a technology entrepreneur and investor and the founder of Pringle capital. My co-host is Hector Mason. Hector as a partner at B2B investor episode one ventures. Our mission is to uncover what it takes to build a unicorn business.

For season three, we're speaking to some of the best founders, many from unicorn companies and asking them about their journey, operational insight, tips, and lessons they've learned along the way.

Today's episode is with Tom Leathes, co-founder and CEO at motorway. Motorway is the next generation used car marketplace. They help anyone sell their car for more money in just a few simple taps and connect car dealers with the best use stock instantly. Tom also previously founded a utility switching company.

That was acquired by Uswitch in [00:01:00] 2011. And an office space website, which was acquired in 2009. So he's a serial entrepreneur with plenty of knowledge on what it takes to build a successful business. Another great episode. So let's get started. 

James: Hi, Tom. Welcome to riding unicorns. Thanks for joining us.

Tom: Hi, James. Nice to be here.

James: Super. So Tom, we're starting season three with, asking all guests. What does entrepreneurship mean?

Tom: okay. So yeah, a big question, I guess anyone would answer that question with the fact that it's a roller coaster. it's absolutely a life of extreme highs and extreme lows. and the reality is that building something meaningful is always extremely difficult as it should be.

But working through that is still the most rewarding thing that you can do. and I guess over time, I've tried to pause more and appreciate the highs when they happen. but also try and remember in the moment of the lows and the challenges things are never as bad as they seem at the time.

I'm this rollercoaster of, building a [00:02:00] company is exhausting, but I couldn't imagine doing anything else, that feeling that you can truly influence what you do with your time and also make a real impact on lots of other people is a very energizing force. it's the second thing I would say is that there is this sort of myth of the entrepreneur founder, CEO.

kind of heroic business figure solo leader and that the entrepreneur should aspire to that mode. But that is my experience at all. I think anything successful is always a very shared experience, built by a group of people. that care passionately about something and then a company, I guess that starts with the founding team or the leadership team.

And if you're lucky enough to get that group right then it's magical because you all multiply each other. You get to have fun along the way, and you get to learn constantly from others while you do it.

Hector: Very interesting. Where did the inspiration come for motorway?

Tom: so motorway is my fourth startup. Really, if you discount all the [00:03:00] crazy ideas that didn't lead anywhere. and I think a lot of what I did and my two co-founders Harry and Alex, I've done all of my previous startups with them and they're also my co-founders of motorway. did a lot, which I think looking back really.

Provided a lot of, a lot of the learnings and the basis for doing motorway, but also the confidence to take on something as big as we have with this, company. but the inspiration really started as it always does for us with a consumer problem as consumers looking at something and saying, why is it like that?

And how can we make it better? I mean, we can dig into this if you like. But the previous startup we had before motorway was a failure and quite painful one. and there were a lot of learnings that came out of that. And we were very, very forensic with our work before launching motorway to work out what we were going to do next.

So we had about six months, the three of us just in. working out what to do next. And we were looking very specifically for a consumer problem. That really meant something to [00:04:00] us, but also an industry that was big enough and broken enough that we really felt we could fix it, that we could really change it.

And you will know this as VCs, but that's kind of what you spend your, your life doing is looking for those opportunities. There aren't that many, right last that haven't been fully disrupted by the internet, but the car industry absolutely is one of the. and we kept coming back to this space, the car space, but really working out what specifically within that we think we could, change the way that it's done in order to make it better.

and that was really the seed for this. and how we got.

Hector: There are some entrepreneurs that we speak to who are just brilliant at going from that zero to one. And then, you know, we will read about the ones who kind of business scales. They find it hard to.

Continue to be the leader that they sort of once were as, as, the business basically becomes a corporate. So I'm just really interested to hear your view on kind of comparing zero to one, to scaling. and whether you think one is harder than the other, whether you prefer one over the other or [00:05:00] kind of how you see.

Tom: Yeah, it's a good question. Every stage in a building, a business has its own challenges. and there are good and bad parts to each stage. motorways by far the biggest company right now that I've ever worked in. the biggest company I've ever worked in, or as part of prior to this was about 30 people.

And now we're 300. So I'm definitely going through that journey now of trying to understand how, how my role changes and how the company changes. so I think the biggest differences are you can't do as much when you're big, in terms of operational, actual doing the work that you used to do when, when it was a handful of people in the room.

And so that can be quite challenging if you're a natural operator and I would put myself into that camp in the beginning, myself, Harry and Alex, we're all on our own. One of the benefits is us as a founding team, is that we're lucky in that he builds the products.

He's the technical and design person. Alex does [00:06:00] the marketing, and I would tend to do the operational sales and business stuff. And that allowed us to basically build the first version of gateway without hiring anyone and doing it all together. It's really powerful because we can do things very, very quickly.

You can learn really fast. You can do it all yourself. You don't have to worry about managing people. You quickly outstrip that and you realize firstly, you can't do it all yourself. But second, there are better people than you at doing these specific things. And then you begin to build the team out and grow.

and I guess that the first stage is in some ways the easiest, because you were just all in a room, you don't have to think about codifying what it means, what your culture is, what your, your rules are, that what's important to you because it just comes out naturally from who's in the room.

And he's he's working at that point slowly, it becomes really clear that you have to start codifying this stuff. If you want to keep it quality. and we scaled pretty naturally say naturally without much friction, let's put it that way in terms of culture and quality all the way up until we hit COVID, I'd [00:07:00] say we were about 50, 60 people at that point.

and then at that point, obviously as every business went through, it felt like the world was falling apart for a little while there. and then. We really grew very, very rapidly after that much of it remotely. and those two things about, being remote, being rapidly, scaling, hiring lots and lots of people.

It really got us to be much more structured about how we think about values and culture and recruitment. giving everyone really clear purpose and communication and what's really changed. And I think since that point, and it remains the most important thing I can do is to give clear direction to the team, and also really help architect those values and was important to us as a business and make sure that works its way through the company, because I can't do all of the work anymore.

And in fact, the team that we worked with a far better than anything that I could get involved in, and it's really my role just to enable that.

James: Yeah. And I think Nigel for done from rails bank said that it's like moving from player to manager over [00:08:00] time. And that was an interesting analogy. And I'd be fascinated to dive into a bit more about your co-founding team. Structure, because I think people who find that team early in their career are very lucky that they get to go through those journeys and iterate and how failures and know that you'll go again.

So I'm sure we come back to that but you've raised over $270 million from top investors like local globe, iconic growth index. And even Alex Chesterman was an angel. So how do you. Approach fundraising. And how does it change as you go through the rounds and they get larger and

larger.

Tom: good question. I'm sort of posing because, uh, we're not a founding team. That's done lots of VC backed businesses. So we built three businesses prior to motorway that were completely bootstrapped from the beginning. And so our default isn't about how do we raise funding? how do we do this?

It's about how do you build a business that has [00:09:00] sustainably in economics and can grow as a business? we definitely took that approach with motorway at the beginning, because as I mentioned earlier, that the startup before it didn't work, that was venture backed. It didn't work out. And it was a reliant on venture capital to keep going.

And when we started motorway, we were very focused on. The unit economics of, let's, try and solve the problem, but one where there's a real business underneath that and that we can prove that to ourselves. So we didn't raise any money we self-funded it in an office for nearly a year until we had a working MVP that was already generating revenue.

And that we'd proven to ourselves that we had a really strong business underneath. and at that point, we, did, um, an angel round with a couple of close friends, Shaq, who, some of you may know, Shaquille Khan and Coco Duncan Jennings, who we'd known for a long time, really trusted and also really valued their advice.

And so they were very helpful in those early stages. And then after that, we did a seed round. and we chose quite Kathy [00:10:00] that we, approached local globe, and also Marchmont ventures, which is the family office of a guy called Hugo Bose. who's a, very much an operator our kind of seed round, which was great.

We kind of led very much towards operators that could, support us through some of the big kind of early challenges. and then we did our series a with the same investor. 'cause we were scaling quickly. Investors had a lot of conviction. We didn't have any particular, need or want to go into a big process.

I would rather always avoid that. Cause you can spend your whole time. fundraising, if you do. and so, you know, that sort of first phase of the business up to like a series B was, pretty natural. And we were focusing on people that we knew and that we trusted and that we can move quickly with.

and then when we came to series B, we really felt like we wanted to get a larger institutional investor on board that had the experience of real scale. an index was very much top of the list that, and Danny rhyme. And You will hear this I'm sure from everyone, but this isn't just about the fund.

It's about the people and how well that will gel,[00:11:00] views on how you should build a business. And what matters, is the sort of key thing that, because, you can be working with these people faithfully, you know, decades, if it goes well. so yeah, that's how we got to work with index and our series B.

and that was the beginning of. Last year. and then last year was a very rapid growth year for us. So then we did our CBC in November. And again, that was led by index, but also with iconic growth, another very large kind of growth investor with tons of experience of global scale. So a lot of it has been about just making sure we're choosing the right investor for the right stage, and the right people to support us as individuals.

Hector: You said something about about this problem being a big problem, you know, the scale of the problem. And I totally. Recognize that in that, you know, I've set up small businesses in the past and they've just kind of been hacky businesses, you know, there's no real groundwork that needs to go into them.

I wonder what the, first steps were with most way. How did you get the MVP? Because to me, it strikes me as one where [00:12:00] you need to. Do a lot before you can go to market, you know, you need to have a load of dealers willing to buy cars. So what, what did that MVP look like and sort of, how did he pull it together?

Tom: I think that's the challenge you face with any marketplace. So realized two things before we started building it, is that we're trying to solve a consumer problem of trying to sell your car for more money. And for it to be a great experience, which has never has been for 50 years or more.

but in answering that question, you have to kind of dig right into what happens to you. and what we quickly found was that the backbone of this industry is the car dealers. and the car dealers, we sort of realized was a whole nother set of problems that they faced, which is that they struggle to acquire stock in a efficient way.

They struggled to find the right cars for their full court, and the whole industry because of these problems is that basically a massive middlemen and inefficient processes. They're all off. And the result in, in the problems that, consumers end up getting ripped off on their cars, dealers can't acquire stock.

So [00:13:00] that was quite a frightening realization because you realize that solving, this is any marketplace. Problem is, as you say, if you get it wrong, you've just got like one hand clapping and you need both sides in order to get started. So we had to find. a useful way to begin an MVP. We didn't want to raise a huge amount of money in order to try and build that marketplace.

So we did some experiments and we partnered with some very high volume car buying for. and built an MVP which allowed the seller to enter details of their vehicle. And they would receive three or four prices. So we weren't doing our marketplace model. At that point, we were aggregating offers from different buyers.

And what that allowed us to do is to begin marketing a product really quickly. And it meant we didn't need a big. We built the technology. it provided a genuine benefit to consumers because it helped them uncover the highest price from some options in the market, but it wasn't actually changing how it worked, what it did was allow us to get product into market, understand how much it costs to acquire customers.

can we use performance [00:14:00] marketing? What are the other ways we can do? And what what are the CPAs? so it was very scientific. Actually. it was almost a two page website that we launched. And it was even under a completely different name. I think we bought, I can't remember what it was called.

It was a terrible domain name, but we just thought let's try and let's hack something together and get some early data for what it looks like. And that's what that early phase was like once we had enough traffic, we identified a small segment of that traffic, which actually in our case was the higher value cars that were coming through and valuing.

And we began to partner with individual dealers. Find the best price and work directly with them in the background, which is a very manual process. and at this point we had a small team and we had this thing with WhatsApp desktop, where we had a team of people who were just WhatsApp in car dealers, photos of cars, and then having conversations with them, learning what they're looking for, talking to every single customer.

And we were as founders talking to almost every seller in those. Trying to understand what they wanted. And it was a real [00:15:00] hard graft and talking to both sides of the marketplace, understanding what they need. And then that was informing the product that we eventually built out.

Hector: Did you have any hypotheses that were proven wrong? early doors from those conversations with, dealers in Antarctica.

Tom: Yeah. The biggest surprise for me was. we need that. We needed to get a loss of car dealers using the platform. And I'm not sure how much you know about the car industry, but there very big dealer groups which have hundreds of dealerships, like franchise, dealer groups, and large independents. and we figured, well, the, best way to get lots of dealers on board is going to be, let's get into the boardroom of one of those big dealer groups.

Let's sell the concept to them. And then that will get us 300 dealers. and we managed to do that. We managed to kind of get in the room and we hustled our way into doing a board presentation to one of the really big dealer groups. And they were lovely. They were really interested and they're really excited about what we were doing.

And we left that room thinking, brilliant, we've done it. And then very little happened.[00:16:00] because what we very quickly realized was that individual car dealerships make their own decisions. And it's not really driven in that. Highly structured way that you might expect. And the answer actually is grassroots.

You need to build relationships with each individual dealership and you need to get them to trust you and you need to understand their needs and help them. so that was a bit of a shock and a bit. we had six sort of regroup a little bit there and go, we're going to have to take a very on the ground approach here to building that network.

and so that's what we did. and it took really a year Of knocking down doors. I was walking into car dealerships without a calendar invite. So, or anything like that, we were just driving around and some of them would literally throw us out because they would be saying, you don't know anything about, cause this isn't going to work, blah, blah, blah.

But then there were others which were much more forward thinking, I guess the more dynamic of these businesses who really wanted to try and embrace the internet and see how they could grow their business through it. and it started from that small base and then grew from that. And it really [00:17:00] is a sort of flywheel because once you can really prove the value and you'd have some good case studies, it gets much easier to get others on board, but there is no shortcut.

certainly not in this space anyway, it really took a year of hard work for us. Then the sales team and the product team to sort of build their needs into a product that really worked for them.

James: Yeah. I think actually a lot of founders, slightly overestimate channel sales, you know, in their planning and actually a lot of it does sometimes come down to just hard graft and non-scalable things to get the ball rolling. So you mentioned all those different complexities of sort of building the marketplace and WhatsApping dealers and everything, but what sort of north star metrics did you use to keep the whole organization focused and maybe as an add on to that, are there any metrics that you think founders should be carrying more or less about on the way to building a unicorn?

Tom: Fairly obviously, but I'm not sure that everyone really does have this as the north star, but genuinely our north star was what's best for the [00:18:00] customer. that can lead you in directions. That might not feel as logical as you'd like them to be. But the car dealer example is one of them where it really involved for them.

They really needed to trust us. and that took work for consumers. it was really about delivering an incredible experience for them. that was a true mix of technology and building a platform, which would make it super easy for them to profile their vehicle. And we built some amazing tools that could help them to do that.

and we've really innovated there around guided photo apps and those types of. but also providing customer support and customer calf for when things go wrong or where there's confusion. And so it was a real kind of mix of, the human side of it and the technology side of it. when you're building a technology marketplace, it's easy to lean away from the human stuff and try and make it all automated.

But in this space where you're talking about for most people, their car is their second largest. Um, so points around [00:19:00] trust and the feeling that you can help them. If something goes wrong is, was really important. And we learned that early and then have built with that as a real north star. So we're trying to build the most trusted place to sell your car as well as the place where you can get the most money, on.

So by keeping that as our sort of north star, we've had to do some very difficult things, but we should prove it to really be the right thing. Right.

James: And just a quick comment on, I mean, I think that's really interesting, cause I think most people would assume. That you're just focused on like number of car trades or GMV or something like that. But it's interesting that you nailed down that actually customer satisfaction essentially is what you're really focused on.

So.

Tom: I think all of the rest of it follows that, right? If you, can really deliver a consistently amazing experience to your customers, I know this is like super obvious, but if you can do that, the rest will follow. If you try and do it the other way around, and then back into a great experience, you'll be too late because you've tried to do the hacky things that might make you more money, but actually is bad for the [00:20:00] customer.

So I do think That's a pretty fail, safe way of doing the right thing.

James: yeah, maybe a question to Hector, like how did you think that VCs put too much pressure on founders to focus on those more like obvious like sales and revenue and GMV metrics and they do on these more important, longer term metrics like customer

satisfaction.

Hector: Yeah, bad VCs, probably. we're pretty focused on. Getting the house in order, really making sure you're focusing on the right things, which is exactly what we're talking about. Aaron, you don't have to be wildly strategic to understand that, what leads to what and the leading indicators of your business and all that.

So interesting. Um, hearing people's different thoughts on that, but yeah, no, no, we wouldn't, we wouldn't sort of encourage GMV at any cost. so just moving on slightly, how do you think about the future of the company? I don't know how you think about it today, whether you think about it as a kind of single product, you know, we can make it easier to sell your car or whether you think there are new [00:21:00] areas that you could go into innovations around what you're doing, are sort of on your radar.

Tom: I mean, we have very big ambitions for what we think we can do with the business. and you know, I guess that's underlined by doing this larger round that we've done now, that we really see huge opportunities to change the way that lots, more parts of the industry that we think we can improve.

Having said. I think people can very quickly get, excited by the shiny new product all the time. You have to choose that time really carefully. The one thing that we believe is really important for consumers, not just for us in our company, but for any companies that you have to stand for, something really specific consumer needs to know what your forum, what you can deliver for them.

and there's a lot to be said for really focusing on doing one thing extremely well, which is what we've done so far. And we've obviously considered moving into other, products and other expansions of what we're doing. But right now we are very much focused on. The best place to sell your car for consumers and the best [00:22:00] place to acquire stock for dealers.

And it's worth remembering that we're operating in a, estimates vary, but somewhere between 50 and a hundred billion pound market, just in the UK, just on used car sales, there are 8 million used car sales every year. In the UK. And right now we're about somewhere between one and 2% of used cars sold in the UK.

So we're doing big volume. But there's huge amounts of headroom left. and so I kind of have to remind our teams sometimes because particularly when you read the press and you kind of get, perhaps about how well you're doing and all of those things, which are every now and again, right.

but you have to remember that we've really still only just got started. I mean, there's a huge amount left for us to do a huge amount, more customers that we need to sell. And the best way we can do that is just by improving what we're doing and bringing it to more people. But once we've achieved that, of course, we want to expand out the products that, and the markets that we operate in.

James: And Tom, I think our listeners will want to understand a little more about you as a [00:23:00] founder. So what really drives you and what is Tom trying to get at?

His career.

Tom: good question. you know, I've been doing, startups, I suppose, pretty much since I left university. So it's really all I know, and it's all I would ever want to do. but I think as I've, I've learned more and as I've been through more of these experiences, it comes much more. about really changing the way that things work and that that's where you really get the most satisfaction.

And also in, being able to really improve the experience of something meaningful for lots and lots of people. And that as a driver is always much more exciting and it's something you never really get there. Right. So it kind of drives me to keep going. my first startup experience, if you like as well, I've been to university and in UCL, which is where I met Alex, my co-founder, we live together and flatten his LinkedIn.

and then after we finished university, I was looking for job and I ended up with two offers. I got a job offer at a investment bank, which looks really [00:24:00] exciting, but then I also got a job offer from this really obscure. Climate change startup, called teacher forests. It's still around actually, it's called natural capital partners now.

And they, they were doing carbon management and upset, at a time when really that was very, very early. And I remember I had this offer from the investment bank and I walked into this room and it was like a small room. There was like 10 people in it. There was a hive of activity. The CEO was.

Scribbling on a whiteboard, Beth for, there were a load of people hunched around a screen. There was loads of like chaos everywhere. And I was like, as soon as I walked in, I thought that's what I want to be doing. That's where I want to be. and I hadn't really thought about it up until that point, but it's really, you know, it's a sense of like, you want to be in that chaos and that uncertainty cause that's where all the fun is.

And I still feel like that. walking into motorway when we're going through like one of our crazy weeks that it does feel like that. And no one really knows exactly how we're going to solve it, but we'll work out going through those experiences is still what I find most fun.

and I would not want that to ever [00:25:00] change over a big week off.

Hector: So does motorway have a shoes off

policy?

Tom: We don't, we should probably, we should probably get one.

Hector: so, knowing what you know, now having set up quite a few pretty successful businesses and now Motorway which is really rocketing. what advice would you give to a younger self?

Tom: Almost all of the things where things haven't gone quite the way I wanted them to, or I haven't felt right about how things are going is generally because I've delayed having a difficult conversation.

And the more, more I look back and examine that, it's almost amazing, not just for me, but also other people I know in not just work by other parts of their life is that people are willing to. Just go through a ton of stuff that they hate, just because they don't want to have a difficult conversation.

And if you translate that into a company, it's the one thing that you could do to make your business more successful and to basically make your life better is just to like look at each day and go, what's the hardest thing that I have [00:26:00] to do at the moment that's on my plate. And just do that even though it's really horrible.

normally it's a people thing, right. It's something to do with, team member that you've got to have a really hard conversation with, or you've got to come out of a deal, even though you're really close to the end because you don't know, it doesn't feel right. And it's really easy just to ignore those things, to go through them.

that's pretty much where all of the problems come. Like if you trust your instincts and then embrace the hard conversation, you probably do 50 times better than if you just let it happen. And I'm guilty of that. I think everyone's guilty of that. Right. But I think I remind myself of it all the time.

we have a bit of a saying Motorway actually, which is just, we're a company built on hard conversations. and we've had to have a lot of them, and we encourage everyone in the team from the most junior through to the executive team to face up to those challenges. And it means that we have some challenging discussions, but it also means we move quickly.

We have a transparent culture and in the end, everyone knows where they stand. And that, means that people can achieve much better work than if things are swept under the.

carpet

Hector: I [00:27:00] agree and I'm only really challenged in this to be difficult, but I think hindsight is a beautiful thing. And sometimes I suppose some of these difficult things that you're talking about, perhaps some of them are where you think there is a chance they will get better on their own or that actually it will be okay.

And it's impossible to know the counterfactual of, you know, if I had just let that run or if I had just kept going with that person, you know, maybe things would have got better. the question really is? How the hell do you trust your gut? Because, you know, having that courage in your convictions, to take action on instinct, I just think is a really hard thing that, some people find really hard.

Tom: Uh, it is hard. Yeah. But I think this comes down to the team that you work with and building really strong trust with them, which also comes from those hard conversations, by the way. Um, because it means when you're faced with something like that, you need to be able to talk out with some people before you, before you make that call.

Um, and if I [00:28:00] just did everything, I thought. We, we wouldn't be in a very good place because quite often my assumptions might be wrong or I need to be challenged. And you need to be flexible enough to change your views. Once you're talking to people that you respect and that have an alternate alternate view.

So it comes down, I think, to having those hard conversations, but also having a small group of people that you really inherently trust and that you can talk out with because you can then test those things before you make those big. Um, but I, I can't really think of any situation where letting it run and seeing what happens, ends up being the right thing to

do.

James: Yeah, it's interesting. Interesting. And there were a lot of job openings for motorway. I think there's 50 plus on the. So, what does it take to work at motorway? And how do you think about hiring? What are you look for? What's the sort of silver bullet. How would you describe your employee base? Like do you

look.

Tom: we look for people who, who are really [00:29:00] ambitious. but also he really enjoyed working as a team and not as this kind of solo operator. which is always a hard balance because generally people who are super ambitious tend to be quite kind of fixed in their views. So we try and find that balance, whether they're very ambitious and very focused, but also really enjoy collaborating.

it's easier to do this when you're smaller because you got more time to spend with prospective employees. and again, the culture is much more naturally formed by he's already in the reading, but as you got much bigger, you have to codify. One of the things we found really useful, which again, I don't think is something that's unique to us is, defining our values and interviewing people against those values, scoring them against those values, and making sure that you're not making compromises just because you need to grow fast.

So even though we are growing quickly and we're hiring fast, we still are very strict around. Making sure that people fit the culture of the company and the values that we stand for.

James: what are those values?

Tom: I won't go through all of them, but I mean, a couple of big ones is that we have one [00:30:00] week we'll create new roads, which is all about innovation and about looking for the non obvious path to get something done. Everyone has values, but it's sometimes it's hard to make them practical. So what we try and do is to actually, you know, values within our team internally, as we set out examples of what, what does fit as value and what doesn't.

And in fact, things like interview questions that you can ask prospective employees to ascertain whether or not they fit within those. It's about setting the values, but probably more importantly, it's making them practical. Otherwise they're just like a poster on the wall and you see that sort of stuff.

It's just to kind of cheesy words like inspiration or, truth or something, but it's about really making them really structured and clear, and then people know how to operate with them. They become a framework for making decisions. that's the only way that you can scale efficiently and keep that culture in place.

Hector: It sounds like that might be one of the other. what I'm about to ask. But if I was to ask you to put aside modesty for a second, what do you think are a couple of things that you [00:31:00] have nailed at motorway?

Tom: I think we've nailed the, technology and human interaction really well. and we haven't lost that. And I think as we scale, the balance between those things changes, we're doing much more through technology now than we ever have before, and we'll continue to push forward, but we're never going to lose that human element.

And I think that's been a big part of our customer experience and our dealer experience. We won't ever lose that. I also think we did COVID well, obviously that was a tailwind for us in a way. Particularly on the car dealer side. So car dealers prior to COVID, we're buying pretty much all of that cars, offline auctions, they would go to an auction, and you walk around cars and then it runs through and everyone puts their hand up.

And that is how most car dealers would buy cars. And when COVID happened, we had a large group of dealers who were buying through us, but many more that refuse to, All of those physical auctions shots, and didn't reopen again for a long time. [00:32:00] And so those dealers were forced to try new things, and that was great for us because we could really lead them through this.

And we were built for digital from, day one. so we were really well positioned to help them through that. And, and we really leveraged that,

Hector: How did that help the business? Cause I can see that would improve the supply of dealers, but did that improve the demand side somehow as

well?

Tom: we're able to deliver a better experience to more car sellers. The larger the dealer base is, and the more they're willing to buy any car. And one of the powerful things about our proposition is that we can find you the best price for any car, whether it's a 2000 pounds Fiat, Or it's a Lamborghini because that dealer base is large enough to provide liquidity for every single option.

And so it's absolutely about getting that balance again, between the two sides of the marketplace. and that's, what's hard about building marketplaces, right? Is that inevitably at different periods, you have more on the supply side and more on the demand side. And your challenge is to continue to keep them in balance.

Otherwise you lose the quality in the service. so no, that was very, very good.[00:33:00] and back to the COVID thing, I think the other thing that we did really well is communicating with the team through those times. And, I've spoken to lots of companies, obviously everyone went through this, right?

And it was all about communication and over communicating with everyone. Here's what we know. Here's what we don't know. Here's what we're doing today. And here's what we think is going to happen next week. But we had to overdo that and we were doing updates to the team every single day. For three months, we were doing detailed updates to the entire.

It was actually a really energizing time for us, even though everyone was terrified about what was happening in the world, actually, motorway, I think was a real grounding thing for all of us. And it's why it was such a productive time for us as a team. and that was quite a defining period.

Really, if you think about three or four years since we've started, nearly half of that was, through

the.

James: Yeah, it's really, really great to hear. How are you managed to navigate through. And so Tom, before we move on to the last bit on dinner party, guests game, you also do a [00:34:00] bit of angel investing on the side. So what do you like to look for? when you're making angel investment

decision,

Tom: Yeah, I'd say I'm not the best angel investor because. I'm kind of sitting with a entrepreneur who really believes in what they're doing and is really excited, I can get pretty excited about where my standing ideas and my filter is pretty, uh, pretty poor. I wouldn't make the best VC. but just really enjoy hearing people.

You know, I learned from a lot of people. Again, if you're hearing these stories about how people have solved problems and how they think they can tackle a market that hasn't, been innovated in, right. It's really energizing to see. So I love kind of meeting entrepreneurs. I got to do a hell of a lot less of that now than I did before, just because I didn't have the time.

but I think my learning is, Just that it it comes down to the people obviously, but also just very specifically how that founding team gels together. And you can really sense where that's healthy debate between them and where there's just like not the right connection. And if I [00:35:00] sense that in any founding team, I w I wouldn't want to be part of it just cause I feel like they shouldn't do it.

And I've said that to some people as well, where they've got a great idea and individually are amazing, but you can just tell us. And that's either that changes or, or they do it separately. you've got to look at that team dynamic in the early stages and make sure that healthy and

right.

Hector: Totally agree. And that there would be, there've been cases where we've seen that with founding teams at seed stage. and again, you have to trust your gut and it's, difficult to know whether you're going to be right, but it is. Maybe in a sadistic way. It's quite satisfying when you see the company failed, because there was found a fallout when you've sort of predicted that.

And obviously we never want to see that, but it is nice having your kind of gut checked every now and then. it's been fantastic having you on the podcast, Tom. before we go, we always liked to play the dinner party guest game, which is where you invite three people of your choice. They can be dead or alive, to, uh, imaginary

business.

Tom: Yeah, it's a really hard question. This, I'm going to be really [00:36:00] annoying and she's four, which is the Beatles because I've just finished watching the, um, the get back documentary. I don't know if you've seen that, but it's like eight hours of footage of them in various studios making the, let it be album, which is the backend of that.

and so much of it is about this intense, creative dynamic between all of them. So they clearly built up over so many years, but actually a lot of it is just them having a laugh together, she didn't really expect after all the legends. and I just loved it so much cause it really underlined that, that, making things that, changed the world, like their music dead, he's actually just in the end, just some people in the room having.

Being curious, messing about, I'm working out. and I think that's a kind of good thing to remember sometimes. And it helps if you have Paul McCartney in

the room.

Hector: Absolutely. Yeah. We've, talked about that on the show. Haven't we James comparing people at the top of their game, in any sector or industry, they share a lot of traits and, you know, musicians, same as [00:37:00] entrepreneur. same as sports people in sports teams, that there's so much, knowledge that can be an insight that can be shared between those people.

but Tom, it's been, yeah, a real pleasure. We've thoroughly enjoyed, hearing about your journey up until motorway and then with motorway hearing some great insight into company, building, hiring brilliant people, developing culture, but about angel investing too, which is always nice. so yeah.

Thank you so much for coming

on.

Tom: No worries. Nice to meet you.

James: Thanks, Tom.

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