Acquisitive mid-market services provider Six Degrees Group has announced two more acquisitions. We spoke to CEO Alistair Mills to get more insights on this eye-catching managed services player.
The acquisitions in question - London-based hosting providers Firstserv and Serverstream - are in fact the eighth and ninth purchases Six Degrees has made in the past year, following its initial funding to the tune of £42m from Penta Capital. It topped that up with a new £25m banking facility in February.
So Six Degrees has been quietly, but very rapidly, building a mid-market services provider. The business now has an annual revenue run-rate of around £40m, according to Mills. He’s also keen to emphasise that he’s not just buying up cheap, floundering businesses. That seems to be confirmed by organic growth from the acquired entities that’s currently well into double digits.
It’s worth pointing out that Mills has a highly relevant background for the task in hand. He was CEO at acquisitive, PE-backed business comms provider SpiriTel up until its sale to Daisy Group in 2010. He’s brought much of his senior SpiriTel team with him too.
Based on management experience, funding and acquisitions to date, Six Degrees is undoubtedly a name to reckon with in mid-market managed services. It joins the likes of iomart, Pulsant, Adapt, Onyx and Attenda as UK-focused mid-market providers of growing scale, all of whom naturally compete with US-based Rackspace. These firms inhabit what remains a highly fragmented mid-market competitive space, but one which is addressing a strongly growing market.
Six Degrees’ positioning is slightly different compared to most of its competitors, in that it is squarely in data networking, hosting/cloud and voice. Mills reckons this soup to nuts approach to ICT infrastructure will appeal to mid-market customers who are looking for a single solution provider. If he has a challenge right now, no doubt it is convincing those same customers that a company built so rapidly from so many acquisitions can operate effectively as an integrated service provider. But given the track record of Mills and his team, you’d be brave to bet against them.