The Utility Warehouse and Dacxi Story

In explaining the Dacxi business, the company Utility Warehouse is often raised. This is due to the similarity of business concepts. I was the creator for both entities — Dacxi and Telecom Plus PLC, now trading as Utility Warehouse [UW].

UW is a well-known and successful British company, yet few people know of its origin as I have never promoted my involvement. As the concepts and connection are often raised in the UK and enquired about internationally, here is additional information:

Telecom Plus PLC facts:

• Founded in 1996 in London, by myself Ed Ludbrook and Richard Elliot-Square. Richard brought capital. I created the concept, led the public listing, and formed / launched the business.

• The business opportunity was fueled by the deregulation of the British telecoms and then utilities [gas, electricity] sectors.

• To raise capital, Telecom plus was listed on a new British ‘entrepreneurial’ stock exchange called the OFEX [now known as NXT]. At the time, this was the first ever ‘start-up’ idea to be listed on the OFEX and in Europe. Investors were attracted to the ‘customer focus’ concept and the commission-only direct customer acquisition strategy.

• The marketing was launched in 1997, and the subsequent explosive business growth created cashflow issues. To address this, new majority investor/CEO, Charles Wigoder bought the company from the founders.

• Under Wigoder, the company kept growing, rebranded as Utility Warehouse [UW] and transferred onto Main Board FTSE.

• In 2019, revenues were £804million, market cap was £1.2bn with 600,000 customers. https://www.londonstockexchange.com/exchange/prices-and- markets/stocks/summary/company-summary/GB0008794710GBGBXSTMM.html?lang=en

• UW is the UK’s leading customer-based telecoms and utilities supplier. Larger companies in this sector are based on owning the infrastructure.

The success of Utility Warehouse growth is founded in its unique concepts focused on:

• A Customer-Centric model to ‘own the customer base.’ Where other companies either own the infrastructure, or simply refer the customer to a supplier, the Telecom plus/UW model is to acquire the customer then supply services to them, so they ‘own the customer base’.

• This has four advantages:

1. It ensures that the company is motivated and able to ensure the customer receives the level of support promised which is vital for services like telecoms and utilities for the public.

2. It ensures that the company has the power to deliver competitive products, as they have massive power to switch suppliers.

3. It means the customer can be acquired via being offered one product then offered further services, thus the original name, ‘Telecom Plus’.

4. It focuses the company on investing in long term relationship with the customer though a ‘personal touch’ which whilst initially costly, pays off with industry beating customer retention and productivity.

• C2C Customer Acquisition model: people are independent affiliates, called distributors, who introduce new customers for a percentage of the customers billed amounts.

Instead of paying for normal advertising, this direct referral system has proven itself to be very powerful in three ways:

1. The switching of telecoms and utilities to another supplier required significant need for the public’s trust thus a direct personal presentation for an affiliate overcomes their concerns in a way no other marketing could. It is the Customer-to-Customer pitch that has the highest level of trust.

2. The C2C approach meant the affiliate would give personal service to ensure the customer is on-boarded effectively by providing a trusted personal service that no supplier customer service programme could compete with.

3. Given the reservations of the public, normal advertising created very high customer acquisition costs, whereas this ‘bonus-only’ system pays only for results.

The basic concept of a customer centric and C2C affiliate marketing were at the heart of the Telecom Plus/UW model from the start and remain a fundamental driving force today.

The Dacxi Comparison

I have been waiting for a similar market gap to create a new ‘UW’ concept for two decades, when the opportunity arose in the Crowd Finance space.

Global crypto offered the perfect product to onboard customers, and, utilising the six product areas of Crowd Finance, offering further ongoing products. The nature of this new financial sector similarly created the same confusion, skepticism, and trust issues that a Customer-Centric and Direct C2C marketing model face.

a) Dacxi is pioneering Crowd Finance and retail-focused crypto just as TP/UW pioneered services reregulation.

b) Dacxi’s model aims to be crowd-centric by presenting the consumer with suppliers and products, by finding the right products for the consumer, and to help them understand the products in a way they need. The model offers further products that are suitable for their needs, and builds a long-term relationship with a unique high-touch model.

c) Dacxi finds customers by applying a direct affiliate model, through which affiliates earn through customer purchases. They provide personal support for people to join. The system is ‘bonus-only’.

d) Dacxi UK also intends to list on a UK stock exchange

The difference:

1. Dacxi does not engage in any form of ‘sales’, the affiliates simply refer potential customers to Dacxi, and link into education resources to build confidence.

2. Dacxi does not use an MLM affiliate system. This system is incompatible with the crypto market today. Becoming an affiliate is free for customers.

Innovation Funding Gap

The universal need for a more dynamic innovation sector, or ‘Tech” sector, has resulted in tech companies becoming the most valuable in the world, providing the highest paying jobs, and driving productivity and wealth creation.

Economies are strengthened by early stage innovation companies, yet these early stage companies struggle to obtain the funding, or the level of funding, they need to grow fast enough. Regardless of claims by governments or industry bodies, there is a massive innovation funding gap between what is being delivered, and what is needed.

This gap leads to many great ideas and companies venturing overseas to find funding and market support. This is evident with the ethnic diversity found in Silicon Valley.

Numbers Game

Many countries in the developed world can only offer a small number of established companies a positive venture capital funding environment — those at Series A and lower. Here, success is never assured, and it is difficult to pick the winners. Series A is a numbers game. So, if you want to have ten successful companies, you need to have ninety funded properly and some will fail, but the winners will emerge with price multiples. These are failure levels that few VCs are prepared to accept so they focus on more established companies.

This Funding Gap gets more acute in smaller or less developed countries. Solving the global innovation funding gap is a passion of Dacxi’s. The company believes that there are an equal proportion of innovative business ideas in Pakistan, Poland and Peru.

The Dacxi Solution

Dacxi is rolling out a new concept to assist in early stage innovation funding. This ecosystem provides a dramatic increases in the number of new companies funded to close the gap to levels required to drive success.