The Rollup of Tomorrow Vol 7. Uncomplicated Group: Walk away from a corporate career to build an Injection Moulding Empire

Disclaimer: Unless noted otherwise, views and analysis expressed here are the author's own and based on public sources. The article is intended for informational and entertainment purposes only. This is not financial advice. Please consult a professional for investment decisions.

*********************

Welcome to Episode 7 of our interview series.

After years working in a multi-billion dollar American corporation, and learning the tricks of the trade, Steve Lawrence decided to take the leap and start Uncomplicated Group. He saw an opportunity to take his skills and apply them to acquire and operate businesses in the UK's injection moulding industry. To date, Steve has acquired 5 companies. 

I sat down with Steve to learn about his journey as a serial acquirer.

He walked me through:

1. Steve’s investment thesis

2. Steve’s approach to deal structure and valuation

3. What Steve focuses on in due diligence

4. His post-acquisition integration playbook 

5. Lessons from mistakes in the first two deals

6. Exit plans

7. Lessons for aspiring acquirers

If you'd rather listen to the audio version of the interview, check out our Rollup Stories podcast on Spotify!

A word for our sponsor - PPHF: the Fractional CFO of choice! 

At PPHF, we specialize in building the financial backbone for serial acquirers — HoldCos, PE-backed roll-ups, and multi-entity organizations scaling from pre-revenue to $60M+.

From transaction support and due diligence to consolidated reporting and post-merger integration, we deliver clarity, control, and investor-grade confidence at every stage of the roll-up lifecycle.

👉🏻 See How PPHF Powers Roll-Ups

Pavel: Hello Steve, why don't you tell me about yourself and Uncomplicated Group?

Steve: I used to work for a large American corporate business with $18B in revenue and 50,000 employees [ITW]. I was lucky to work in one of the smaller units. It didn't feel lucky at the time because it was a lot of work, but it served as my apprenticeship in business. I learned about sales, operations, design, and strategic planning.

I had always wanted to have my own company and then decided to take the leap and create the Uncomplicated Group.

Injection moulding is my background and I wanted to stay close to my experience. I figured buying companies was a steep learning curve, so I might as well do it in an industry where I knew what I was doing.

The plan is to build a group of companies that support each other with back office, design, and shared resources. We can then start thinking like a bigger company - the way I used to in corporate, but apply it to SMEs.

Pavel: For those not aware, what is injection moulding?

Steve: It's plastic components. You inject molten plastic into a mould that creates various shapes - anything from a pen lid to Lego to medical devices to car components.

1. Steve’s investment thesis

Pavel: How did you develop your investment thesis for this industry?

Steve: I realised there were a lot of companies with owners approaching retirement age - probably looking to exit in the next 5-10 years. There's a wave of people looking to sell but not many people my age with relevant experience who can take these businesses on. Succession planning is minimal.

On top of that, there's significant excess capacity in the sector. Many machines aren't running as much as they should. 

Finally, I learned really useful techniques and strategies in my corporate job - corporate-level thinking that many SMEs haven't adopted. There's very little automation, marketing, or strategic sales positioning. 

Pavel: What does a typical company look like in terms of size, revenue, and profitability?

Steve: There are about 1,500 injection moulding businesses in the UK. Maybe 40% have owners who will potentially retire soon, so perhaps 400 to 500 targets. 

Typically, these businesses range from £0.5M ($0.7M) of revenue up to £3-4M ($4-5M). Of course, there are much larger groups in the tens of millions owned by corporates or private equity. However, that's not the majority of the market. Margins range from 5% EBITDA to maybe 20%, with really well-run businesses hitting 25%. An individual business will have up to 25 to 30 employees maximum, but commonly between 5 and 20.

Pavel: How do you decide which leads to pursue?

Steve: If there's too much dependency on the owner, I don't see it as viable. You also don't want to finance something with shaky revenue performance. Customer concentration is critical - it's hard to scale down costs if you have a drop in volume.

Specifically for injection moulding, there are a lot of generalists who'll mould absolutely anything. Without specialisation or differentiation, you face strong downward price pressure. I tend not to pursue generalists. I prefer companies with their own products where we control the designs, markets, and pricing. Or subcontract manufacturers with a specialisation within a sector or method.

I also look for businesses with capacity to grow in their existing footprint - already well invested, but maybe only running one shift, with good equipment. 

Pavel: How predictable is the revenue? Are there long-term contracts?

Steve: Generally, you'll sell a component to, say, an electronics company for the life of that device. Maybe the device is around for 5-10 years. It's not super common to lose business mid-manufacturing cycle. It's not like you build it once and never see the customer. If you're moulding your own products, that is a slightly different sale.

Again, you want to go into the markets where there is long-term sustainable revenue. In my first acquisition, Techmarkets based in Manchester, we sell into construction. We mould fixings, fitments and spacers that go into the concrete industry. As long as buildings are being built, there's demand for our products.

2. Steve’s approach to deal structure and valuation

Pavel: How do you value businesses? What are the quantitative and qualitative factors?

Steve: Generally, it's a multiple of EBITDA. If I see too much owner dependency or customer concentration, I don't even look at valuation - it's not a deal I'd pursue.

I've learned through mistakes to factor in CapEx run rate. It's easy to look at EBITDA without realizing this is a capital-intensive business. There will be replacement CapEx that needs to be baked into the valuation. In reality, it's EBITDA minus CapEx for a free cash flow number.

Pavel: What's a typical deal structure? Cash at closing, earn-outs, transition agreements?

Steve: Generally 50% to 60% on day one, then the rest deferred over 2-3 years, depending on the deal and risk, of course. I like to tie the deferred payment to business performance in some way, so if there's a significant revenue drop or margin issue, we can discuss it with the seller.

Pavel: Do the founders typically move on?

Steve: Yeah, generally. It depends deal by deal. For me, in the deal I've done, the founder left pretty much immediately, and another minority shareholder stayed for a year to help with the transition. Most of the time, people are ready to get out. They're happy to help with transition and look after the staff and the customers, but there isn't usually a long ongoing working period.

Pavel: Do you share management between companies?

Steve: At the moment, they're decentralised. There's me in the middle with local management teams at each location - their own sales, operations, and finance teams. I'm probably getting stretched too thin. If I want to keep doing deals, I'll need to either put crazy miles on my car or never sleep, which doesn't sound attractive. At some point I'm going to need to create a controlling management layer, but I'm not there yet.

3. Due Diligence focus

Pavel: What do you focus on in due diligence? What matters most and least?

Steve: Customer performance is number one. There's not much you can do to flex costs up and down if something goes wrong. Revenue reductions are really painful. When teams have been there a long time, you can't just scale down, and you don't want to.

Often in the deals I'm looking at, I'm only buying the operating business, so I need to sign a new lease. In both deals I've done, the seller owned the building and the lease was actually worth more than the purchase consideration. It's easy to spend too much time on operating details and not enough on the lease, but there can be just as much risk there. 

In terms of things I'm less concerned about: suppliers and existing internal systems. They're likely going to change because I want to refresh them with new systems or ways of working.

The team is important - I look at who's there, their length of service, their industry knowledge. You don't meet these people before completion of course, but you get a picture of who's doing what, potential gaps, and things you need to address quickly after takeover.

Pavel: Do you interview the largest customers as part of DD?

Steve: I actually haven't. But I was chatting with another acquirer recently who gets a full report on the top three customers, and I thought it was a fantastic idea. I've had a bit of resistance in my deals to speaking with customers - one could argue it would only get bigger if I'm their competition as an existing business. I can see why they wouldn't want me interviewing customers. That's something I need to figure out if I start getting into bigger deals where the numbers and risks are larger.

4. Post-acquisition integration

Pavel: You're now the owner of a multi-million-pound business. What happens on day one, in the first three months, and in the first year?

Steve: Day one is the obvious one of meeting the team and showing you're the real deal. Especially in injection moulding. The sector has had a tough few years. Most people think an acquisition means the factory is going to close or move. The team obviously are really nervous, and you want to avoid those nerves. You need to show people you're legitimate and lay out what you're trying to achieve.

In the first few weeks: finance. You bought the company based on past performance and models, but suddenly you're in the present with no gut feel and no intuition about what's happening. You've taken on new debt and you've got a nervous team. Get proper reporting in place! 

Further out, we implement EOS - an operating system, which is like a set of tools and disciplines that give the business structure. The business has probably run a certain way for 20 to 30 years, maybe informally or in the owner's head. We put structure in so we have the right people in the right seats, know what to measure, and people understand what they own.

EOS also creates a forum for the team to raise issues - things they've always wanted to change. It's a helpful way to build trust because you learn about the business together. You're not just doing something to the team, you're doing it with them. It helps build relationships - they get time with you, you understand how they work, and you get some good gold as to the things that you need to focus on really quickly.

From Rollupeurope: if you are curious about EOS, get in touch with Rob Liddiard, an experienced implementer based in the UK!   

5. Learning from mistakes

Pavel: You mentioned spreadsheets and models. Did you have things in your spreadsheet that turned out completely false?

Subscribe to Premium to read the rest.