Keith Rogers was arguably one of the most unusual environmental engineering students at the University of Strathclyde. When he wasn't attending lectures or writing essays the then teenager was running his own fleet of ice cream vans
Keith Rogers was arguably one of the most unusual environmental engineering students at the University of Strathclyde.
When he wasn't attending lectures or writing essays the then teenager was running his own fleet of ice cream vans. Grangemouth-born Rogers had started his business when he was just 17 and the income helped get him through university; when he graduated he sold it and made enough profit to buy his first house.
Today Rogers runs a very different business as chief executive of Alternative Investment Market-listed, five-a-side football centre group Goals Soccer Centres, but he has not forgotten his early experiences. "I was interested in business and university was almost a sideline," he admits. "Thinking back, I haven't got a clue why I chose to study environmental engineering. It seemed interesting at the time. I enjoyed maths and I enjoyed physics and it brought both elements into play.
"They were great years to be honest, and I thoroughly enjoyed running the business. It was a good grounding because you worked seven days a week. It didn't matter if you were out late on Saturday night, you were up early on Sunday morning to make sure your vans were all out."
The 50-year-old is still as enthusiastic about business as he was as a schoolboy and his success with Goals is obviously very much a result of that. The East Kilbride company employs more than 600 people working in 42 five-a-side football centres in the UK and one in the US.
While many companies have been struggling during the downturn Goals enjoyed a 21 per cent increase in profits last year to £9.2m.
Like a good game of football the story of Rogers' career is full of action and drama. After leaving university Rogers' experience of running a business encouraged him to start another and, with backing from Hill Samuel Bank, he got involved in buying a health and fitness business in Paisley. However Rogers realised the five-a-side pitches tagged onto the outside of the centre were bringing in far more business than the health and fitness centre and decided to create more of them. Eventually he went the whole way and turned the entire business into a five-a-side football centre.
"It went from strength to strength and we had the realisation that we had a great business idea and could take it forward," he says. "However, at that stage the five-a-side football industry was non-existent. We approached many of the banks and they didn't really buy into the business case because it was a one-off and had never been done by anybody else despite the fact it was very profitable. We found it very difficult to raise finance to do additional centres."
However the breakthrough came when it teamed up with brewing giant Scottish & Newcastle. "I remember inviting some of the main board directors down to Paisley to see the centre for the very first time. They came down on a weeknight; the rain was horizontal and every single pitch was absolutely jam-packed. I think they thought we had bussed everyone in to make it look good but the reality was people love playing five-a-side football and this was a typical night.
"Obviously the footballers at the centres were running about getting very thirsty so we had very good bar sales. Scottish & Newcastle took an equity stake and introduced us to Bank of Scotland who also got involved in the business. From that point on it went from strength to strength. It was a very successful business model and we built that up to 11 centres."
However, some of the shareholders wanted to realise their investment and the company - by then called Pitz - was sold for around £28m to venture capital giant 3i. It asked Rogers to stay on as chief executive but he was not happy with its plans for the business. "The business plan they presented didn't appeal to me. i didn't buy into it; i made that quite clear at the time.
"I have always had some key basic fundamentals which i think have made this business a success. one is the best quality sites I can get my hands on. i have always believed in building good quality sites and giving great levels of service.
"The second part is putting good quality facilities on the ground costs money. Unfortunately football in the past - and 11-a-side football - has a reputation for providing very poor quality facilities. We are all used to muddy pitches, cold showers and the wet changing rooms. We wanted to attract a much wider demographic and to do that you have to put in good quality facilities. "The 3i plan was premised on spending a lot less money per centre and making the assumption you don't need to put quality facilities on the ground for footballers and that is where I differed. For me, anything I wanted to be part of had to totally subscribe to these fundamentals.
"The day the deal was done I handed in my resignation," he says. "I don't believe for one minute they thought I was going to leave. I think they took a view that I was too closely wed to the business to walk away."
He was fortunate not to have any real restrictive covenants and in 2000, with the backing of venture capital company Dunedin, he led a management buy in at Goals, a small, family-owned, five-a-side football business with just five centres.
Rogers set about improving the Goals centres and putting more investment into them. "We trained all the staff, changed the branding, kept the Goals name and put in place systems and procedures. We had quite a significant knowledge in the industry and all that knowledge was really brought to bear. Because it was a small business we were buying into it was almost like starting with a clean sheet. Then we built what we called the next generation of five-a-side soccer."
The company invested between £1.8m and £1.9m in each new centre it developed. "Dunedin were absolutely fantastic and we have a very good relationship with them to this day."
In 2004 - knowing Dunedin wanted to exit after five years - Rogers and his team started looking at options rather than waiting for the decision on their destiny to be taken by others. "We had the option of going with another VC but we felt it was only postponing things for another five years. The second option was to go for a full bank funding buyout from Dunedin. But that would constrain growth in what we saw as a magnificent opportunity for the business."
The final option was to look for a listing on the stock market. Rogers says people were very sceptical when he presented that idea because they took the view there weren't really any Scottish companies listing at that time and that five-a-side football might not be easily floated on the stock market. "Certainly we believed very hard that we had the perfect business in terms of scale, size and roll-out potential that we believed the stock market would take well to.
"So we did some testing with the markets and invited a number of fund managers to an open day to get their reaction to the business and they loved it. They were very enthusiastic and that is when we took the decision to go for a listing which proved to be very successful."
Interestingly, Rogers' former company Pitz evolved into Powerleague, which also floated on the stock market though it was sold to private equity company Patron some 18 months ago. It remains Goals' biggest rival though since it went private the company has stayed fairly low profile.
Goals has grown steadily since 2005, when its profit was just £300,000. However its shares went through a rollercoaster ride last year after the company was hit by the severe winter weather. "If you look at the business the one thing about football compared to other leisure spends is it has proven itself to be extremely resilient to the downturn. At the very worst our like-for-likes were flat, which is almost unheard of in any leisure company in the current climate. It has been pretty much positive most of the time."
One of the strengths of Goals is the diversity of people who use its facilities. "If you stand in one of our car parks you will see a guy get out of his Porsche with his kitbag to play and you will also see the works van turn up and ten guys jumping out of the back," says Rogers. "It is from boardroom to shop floor.
"There is a great social aspect to it as well. It is not just a night out playing football it is a night out with your colleagues or your friends or your mates and there is always the post-match discussion and banter that people have afterwards.
"Once you start playing it really becomes a habit. People will start playing with us in their late teens and stay with us through to their forties playing on a weekly basis. We have 130,000 adults going through our doors every week. Our income comes from 130,000 times very small payments. We don't rely on a few big ticket customers. Our income base is spread over a very wide base."
An increasingly important part of the business is its website. "If you play in the Goals leagues all the stats are there to the nth degree which makes it all part of the fun and excitement," says Rogers. "Social networking is a big focus for us. We are working on some key initiatives and what we are actually doing is replicating a lot of the features on our website over onto Facebook and that will be rolled out over the course of this year. You will be able to book your pitch over Facebook and be able to organise your team through a Facebook app.
"If you think about it football is a social network. You play with friends and colleagues, you play at local, regional and national level. So getting our customers to deliver on Facebook with the relationship with Goals is absolutely crucial."
Rogers is keen to expand internationally but he is taking a cautious approach. The company opened a soccer centre in Los Angeles in California in 2010 in time for the last World Cup. It originally did the deal as a joint venture but has since bought out its partner. "Soccer has been the most popular participation sport in Californian schools for ten years. One of the great attractions for us is it is not just played by men but it is also played by women. And children are very actively involved also in terms of coaching. It is a non-gender sport a bit like swimming and tennis in this country. They don't have the heritage of it being a male-dominated sport which is great."
Goals is seeing more women now playing in the UK but Rogers says it has a long way to go. "Things are improving and we are doing everything we can by running women's leagues and so on. I look at it simply; 50 per cent of the adult population generally don't play football in any great number and we are trying to change that.
"We have quite a lot of women managers working in the business and there is no reason why we should not have more women playing football. We are encouraging that as much as possible."
Rogers sees a huge opportunity for growth in the US. "What we are doing just now is concentrating on that initial site, learning and understanding the market with a view to, at some point, rolling out more centres in the US. We are not pursuing any other countries at the moment. We do see this having global potential. But you have got to take it at a reasonably measured pace. There are areas of the world we are planning to go to through a franchised relationship."
"We still see a huge opportunity in the UK," he adds. "We have got a pipeline of well over 40 centres in the UK. I want to tie down the UK opportunity."
Over the years Rogers has resisted the temptation of sponsorship from online gaming companies and lads' mags. "Our brand partners are Umbro and FourFourTwo because we are building Goals into a pure football brand and we want to maintain that high ethical stance Goals has," he says. "If you look at the company we have a very strict ethical code in the way we operate, the type of advertising we allow in our centres, the type of partnerships we enter into and we have a very strong community access policy.
"In all our centres across the country we give children free access during term time during the week. That is actively taken up by tens of thousands of kids every single week across the country who are getting access to state-of-the-art football facilities with no public subsidy at all. Obviously it is not totally philanthropic. They are going to be our customers in the future. The more people we get involved in playing football at a young age can only be good for us in the future. In this business we are here for the long term. We look at all initiatives to see what is it going to provide for us in five, 10 or 15 years' time."
Rogers says the management team at Goals is very committed and departures are almost negligible. Recently it had its annual gathering for managers from all over the country at Cameron House at Loch Lomond. "One important aspect of that was to make sure the vision for the business is living through all the key individuals in the business, regional managers, general managers, deputy managers and so on. We promote from within so you have to go through a very well defined career progression within the business."
"I think because we give such clear staff development and staff progression and train our staff so well and give them the tools to equip them to do the job best we do have a very high level of staff retention for the leisure industry which is notoriously bad at retaining staff."
Rogers believes you do not have to be hard on people to succeed in business. "I don't subscribe to that way of doing business at all. Sometimes I watch The Apprentice and I cringe. My belief is you get more out of people if you can get them to deliver well for you and buy into that vision and become passionate about the business. Winning people over and getting them to subscribe to your beliefs in the business is the way to get the best out of them."
Rogers has been offered a number of non-executive directorships but has turned them all down. "My key focus is this company. If I did have time to spare I would spend it with my family."
However he is not inward looking and admires Scotland's active entrepreneurs. "The great thing about Scotland is it does have a history of outward-looking entrepreneurs. I think there is something about the Scots personality that makes them perfectly suited to building up successful businesses. You can go to almost any part of the world and you will find some Scotsman somewhere with a business or a business that came out of Scotland years ago. And I would like to think Goals is continuing that."
As we were going to press the Ontario Teachers' Pension Plan Board confirmed it had had preliminary discussions with the board of Goals about a possible takeover bid.