Automated switching service Look After My Bills, which featured on BBC’s Dragons’ Den, has been acquired by GoCompare in a deal worth £12.5 million.
The GoCo Group, which also owns Weflip, announced it had acquired This Is The Big Deal Limited (trading as Look After My Bills) in its half year results published today (25 July).
The deal is part of the group’s bid to grow its customer base by 25 per cent by 31 December this year.
Total consideration for the acquisition is comprised of £6 million upfront, financed through the group’s existing resources, plus £2.5 million deferred consideration as well as up to a further £4 million performance based earn-out.
The GoCo Group said the acquisition “significantly strengthens” its proposition in the energy sector and further unlocks the “significant opportunity” that exists.
Matthew Crummack, chief executive of GoCo group, said: “We are incredibly excited to announce this acquisition, which enables the group to continue to address consumer inertia.
“Weflip and Look After My Bills complement each other in their approach to saving UK consumers money and with both brands we can target the significant saving opportunities that still exist for consumers, who haven’t been tackled by existing price comparison websites or regulation.
“Together, Weflip and Look After My Bills, form the group’s AutoSave segment which is building momentum and is in a great position to address the needs of infrequent switchers.
“Our ambition is to rapidly scale customers and build our AutoSave business to grow live customers by at least 25 per cent in the next five months to 31 December 2019.
“Jointly we have the skills, technology and discipline to address the substantial opportunity in addressing the ‘infrequent switchers’ and save the UK billions by switching.”
Look After My Bills, which currently has more than 150,000 customers, received the “best equity deal” in the 13-year history of the BBC show when they featured last year.
Founders of Look After My Bills, Henry de Zoete and Will Hodson, received offers from all five Dragons on the show, with Peter Jones saying the pair had a “real chance” of making the scheme a success.
Hodson and de Zoete struck a deal with new Dragons Tej Lalvani and Jenny Campbell for the lowest amount of equity ever given away – 3 per cent for £120,000.
In response to the acquisition, Look After My Bills issued a joint statement from the co-founders.
“Look After My Bills is on a mission to ensure no-one gets ripped off again, ever. We are proud to share that vision with some of Britain’s best-known brands in the GoCo Group.
“Our companies are united by the belief that making saving easier will bring down bills for everyone, forever. Why spend hours finding a decent price each year when you can appoint an expert to deal with all the hassle for free?
“For us it’s been an incredible ride as we’ve built a fantastic team of energy experts and a culture that will not accept any one of our users being overcharged. Joining forces with GoCo Group and being powered by their SaveStack platform, will help us bring Look After My Bills even more into the mainstream.”
Meanwhile Jenny Campbell said: “I invested in Look After My Bills because they are an ethical business on the side of consumers in a market where too often people are being taken advantage of by energy companies.
“Will and Henry are also highly credible founders who have known each other for decades and already built a business that was working.
“We could see that they had huge potential to scale up which they did winning over 150,000 customers in less than 12 months. Now they have the backing of GoCoGroup (parent of GoCompare) they will go on to even bigger things.
“Tej and I were delighted to be able to fight off the other Dragons to make sure we got the deal. It’s certainly proven to be the right move.”
Meanwhile the group’s financial results also revealed that adjusted EBITDA for the period reduced by 33 per cent to £14.7 million.
The reduction, GoCo said, was primarily driven by marketing spend which increased by £7.3 million to £47.3 million, primarily as a result of investment in the launch of Weflip.