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EweMove founders sacrifice millions of pounds in earn-out fees as they walk away from the business

fIXFLO news story

The two founders of hybrid agents EweMove, famous for its puns and jokes and bought by Martin & Co in only September for a total of £15m, are sensationally quitting – sacrificing a two-year earn-out worth £6m.

David Laycock and Glenn Ackroyd will leave what is now the Property Franchise Group at the end of June, with millions in their pockets. It now looks as though Martin & Co will re-examine how, if they wish, to get into the online/hybrid agency market.

Laycock and Ackroyd will, however, quit taking with them the £8m paid upfront some seven months ago in the form of £5m cash and £3m in shares. A further £7m was promised in the two-year earn-out.

Now however the pair will sacrifice most of that, taking with them a further £1m in cash. Some will be payable in July, and the rest at the end of the year.

The announcement about the departures is being made to the stock market this morning, with EweMove’s new owners saying that it wants the brand to be taken more seriously by agents.

Property Franchise Group chief executive Ian Wilson denies that there has been a bust-up, that the pair have been sacked, or that he regrets the acquisition of the network of 90 operators, mostly working from home.

He did however say that “we are disconnecting their employment”. He stressed that it was Laycock and Ackroyd who had asked to go, and he paid tribute to them as “clever, capable guys”.

Wilson did, however, say the pair – who previously ran a ‘quick sale’ estate agency business before founding EweMove – had “not really settled” after the purchase.

Last September, Wilson said that it was a way for Martin & Co of getting into the hybrid/online estate agency market.

So, has the business regretted its purchase?

Yesterday evening, Wilson told EYE: “We are definitely not regretting the deal. Their technology is better than anything else I have seen. It would have taken us a long time to build.”

However, Wilson did say that there were disagreements as to the franchise recruitment operation, which he described as “anti estate agent”.

He also said that while shareholders thought that EweMove should become “Purplebricks mark two”, this was not currently on the cards.

Wilson said that values of customer service, upheld by EweMove, were also held by “old school estate agents”. He believed no one is better placed to deliver that, and that these agents were the type of people that EweMove should have been recruiting – similar to the Local Property Experts model employed by Purplebricks.

Wilson also said that while EweMove’s inexperienced franchisees have proved to be very good at getting leads, they “are not good at converting leads”.

Laycock and Ackroyd will still be available to act as consultants to the Property Franchise Group until the end of the year. Neither will be able to work in the market for two years – we understand in the roles of either employees or directors.

Wilson said that it is unlikely that the jokey brand name – complete with puns about head shepherds and sheep pens – will change.

The Property Franchise Group will now bring in experienced management for EweMove, and also appoint separate managing directors for its Martin & Co and Xperience brands.

It is also understood that the existing franchisees of both Martin & Co and Xperience were consulted about the direction of the brands held by the Property Franchise Group.

The official statement says:

‘Following the announcement this morning that EweMove’s founders are to leave the business, Ian Wilson, CEO of parent company The Property Franchise Group PLC, said: “Glenn Ackroyd and David Laycock, founders of EweMove, will be stepping down in June this year.

“We are hugely grateful to both Glenn and David for their entrepreneurial spirit and vision, creating this dynamic hybrid estate agency. The time, however, is now right to move the business to the next level. We are looking for a new managing director for EweMove, who will share the founders’ passion for customer service, allied to the latest in prop-tech, and who will reach out to the many estate agents who want to own their own business but do not want to risk £100k on a cold-start shop.

“We bought EweMove because it was the fastest growing pure franchise in the property sector and its pace of growth has continued with 11 new franchisees signed up since 1st January this year and 100 active all over the UK. We are wholly committed to this brand and its network of franchisees but we do want it to be taken more seriously by experienced estate agents.

“Perversely it’s modern digital technology that can bring old-fashioned virtues of excellent local customer service to life.

“EweMove is open 24/7, its franchisees don’t do paperwork and its website converts traffic into leads at an almost unheard of 8% – the average estate agency website is lucky to achieve 0.5%. This means that EweMove franchisees can literally ‘turn the dial’ to decide how many vendor and landlord leads they want to receive by setting their Adwords spend. Unlike other ‘on-line’ agents EweMove works on a traditional no sale, no fee basis and attracts higher than average fee instructions.

‘The new MD will be based in its Cleckheaton, Bradford HQ.’

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Source:: EweMove founders sacrifice millions of pounds in earn-out fees as they walk away from the business