We sat down with Anna Nguyen and Peter Evans, the trailblazing co-founders behind the Training Marketplace, to discuss their innovative approach to building a startup business in challenging times. 

It's not your usual startup story, and the company isn’t following the common blueprint that leans heavily on investors. It’s a fresh approach to funding and investment in a space that’s often cluttered with complexities and costs. Rather than chase traditional funding sources, they’ve chosen to leverage sweat equity as a powerful tool to attract top-tier talent.

Co-founders Anna and Peter established The Training Marketplace, an online platform that connects corporate training providers with businesses seeking quality corporate training for their teams. The platform covers a wide range of training areas, including finance, sales, marketing, and leadership. Their goal is to eliminate mediocre, box-checking training and connect regional providers, whether from Vietnam or Newcastle, with multinational corporations and institutions seeking top-notch, relevant training. They prioritise matching businesses with the provider that best fits their needs, rather than just those who rank highest in a Google search.

 

Anna: Peter first reached out to me about this idea while I was working in Vietnam during the COVID-19 pandemic. We were part of the Durham Venture School, an accelerator program run by Durham University, and I was taking part virtually because of COVID. Since I was in Vietnam and travelling around South Asia, I did some research to see if the challenges were similar to those in Europe. There turned out to be an even bigger need! I returned to the UK, and Peter and I started working together. Now, I have a lot of technical skills, work with our financial investors and manage communications, and marketing, collaborating closely with our developers and operations teams to bring customers on board.

Peter: We both realised that if this project was going to be more than just a fun development exercise and actually take off, we needed a global team. From my experience, I know that a successful company needs a strong team. So, we had two choices: either secure investment to pay for C-level people, which is tough to do before you have a product or customer base, or find a more innovative way to bring high-quality talent from around the world into the company in a way that motivates them to give their best while ensuring we don’t go bust within the first three weeks.

We received some assistance from Innovate UK and university grants that allowed us to have something to show people, but that funding was for project development, not salaries. So, we had to decide whether to seek angel investment, venture capital, or fund it ourselves and find people willing to work for a different type of reward. We explored all options but recognised that with no revenue or product, approaching institutional investors with just an idea is mostly a waste of time in the UK—perhaps it’s different in places like California.

We cut out the middleman, instead of selling our equity to investors to raise cash and spend it on great people, we’d give the equity to the people who will actually help build the project.

For us, the equity really has to be for a long-term asset of business. And that means for the commitment of the people - the strategic long term, rather than the operational work of a business. So, for us, equity means a senior long-term commitment. And how we’ve structured it is to say that the reward itself doesn’t vest until two things happen. One, the company is actually worth something because there’s no point vesting something that’s worth nothing. And second, we’ve agreed that the milestones that, let’s say the Digital Marketing Director, has done over the past two years have been met mutually. There’s a company target and an individual target for each of the people involved. And that’s how we de-risk it.

 

"We met with 70 people, over 70 Zoom calls."

Anna: From those meetings, we found our current Sales Director. He was our first connection in training development, he’d previously served as a director at Oracle Learning, bringing extensive experience and networks in the training industry. Then we realised that we need more people in sales and marketing. We were fortunate to meet an expert with extensive experience in the training industry with a broad network across Northern Europe. And we found our Marketing Director and Chairman, who both bring with them decades of experience. It’s been amazing.

Peter: My background is in investment banking, I know what our company is likely to be worth in three years’ time when the equity vests. From there, you can then work out a portion of equity. And that’s roughly speaking what we did when we were calculating how much equity to trade. And what I did with everyone was to show them those numbers. The key, I think, is to be absolutely transparent, we’re all in the same boat. If this company hits this revenue and this profit, then it’s likely to be worth this. Your share is likely to be worth that. Are you happy to work for that over the next two or three years?

There will be some complications, if you’re offering people a percentage, then you have to be careful about dilution. So, the people that come in first get a slightly bigger number of shares than the people that come in later. I started my career as an accountant so I can work that out.

Anna: I always think about why all these amazing team members ended up working with us. They’ve been very dedicated right from the beginning and kept coming back to us. They didn’t wait for us to actually instigate everything but were proactive and showed engagement before they’d actually had any reward or any potential equity. They believed in our ideas and that, as a team, we are building something significant and it will definitely become a success.

 

"I’ve seen founders end up with 5 – 10% equity in their company."

Peter: For companies who are thinking of leveraging equity in their company, really think carefully before you do it. Think what your company is likely to be worth when you exit and then quantify that equity. If you are trading your equity, think about trading it for an asset rather than to save an expense.

 

In conclusion

Anna’s and Peter’s approach to equity is thoughtful and strategic; anchored in the projected valuation of the company as well as the commitment and skills that each person brings to the team. Training Marketplace opted for a growth share scheme* to ensure that as the company scales so does the personal stake of each team member, aligning individual achievement with broader company goals.

There’s a lot to unpack for other founders thinking about sweat equity and how this strategy impacts fundraising and potential future exits. It is crucial to think of equity trading as long-term, prioritise sustainable, valuable assets over short-term gains.

Instead of getting stuck in the often-frustrating search for investors, Anna and Peter chose to cut out the middleman and focus on building a strong team with like-minded individuals willing to work for equity. This innovative approach allowed them to attract dedicated professionals who believed in their vision, enabling the company to thrive from the inside out.

 

Joining The Training Marketplace is FREE for training providers. For more information, visit The Training Marketplace website

 

^{* It is important to research and seek advice where needed on the most appropriate way to distribute equity to your sweat equity team. Growth shares may or may not be the best solution for your startup.}