This week’s collaboration is with our wonderful network member, The Value Loop. The Value Loop (TVL) is a method for you to effortlessly find counterparties to transactions you want to complete – these are called DEALS. Founder and CEO, Owen Davidson Knight tells us all about The Value Loop and how it can really help you to monetise your very own network.
- You and your business partner launched The Value Loop just over a year ago. How did you meet and where did the idea stem from?
This is such a ‘covid-era’ story! I had been working on a number of M&A Deals in the months leading up to the pandemic, and as soon as everything shut down, all the business owners I was talking to basically called me up and said some version of, ‘really enjoying the conversations we’re having, but can we put this on hold for now?’
So I got my networking boots on, and started speaking to as many business owners, investors, and entrepreneurs as I could, in different countries, sectors, and stages of business. One of these conversations led me to my business partner Declan Murphy, an Irishman in Dubai. 1 year in business, and we’ve never met. In fact it’s got to the point now that we’ve said we won’t ever meet in case we lose the magic!
Declan and I connected over the observation that there is just such an abundance of opportunity out there that it can actually be overwhelming – you can see so many Deals everywhere, but you can’t do them. So what do you do? You pass them on to people you know who could do them – it happens every day in business – people who know each other sharing Deal opportunities.
So we thought we could put together a small group; Declan could bring a few pals, I could too, and we’d have a little group of say 10 people sharing Deal flow, and making use of all of our networks to help Deals find their counterparties or customers.
Then we said, ‘hang on, if this is going to be really powerful because we’re harnessing the network effect of 10 different networks, what would happen if we did that for 10,000 networks, or 100,000, or 1,000,000? Penny’s in the air.
And what if all the people along the way, who have helped put the two sides together, get a share of the commission that is paid out? Penny drops. The Value Loop was born.
2. Tell us a little bit more about The Value Loop and how can businesses can get involved.
The Value Loop is a network of networks. Our users post Deals, and they are shared via 1-1 connections across networks until they find their rightful customers or counterparties.
So let’s say you’re a B2B business, and your product or service value is £100k. You would write a 1-page summary of what you do, what your ideal customer looks like, and what you’ll pay the network if they can deliver a client to you.
In our experience, business owners don’t generally advertise on their websites that they’ll pay you 10% if you bring a client… but if you go and ASK them if they’ll give you 10% if you bring them a client, they’ll usually say yes!
So in this example £10k is paid out in commission, and all of the people who brought the 2 parties together get paid – people who introduced each side of the Deal, people who introduced them, and so on – so the value that is created in that transaction is shared among everyone who helped to create it.
3. Could you tell us a little bit more about the commission structure please? How is it calculated, how it paid, and what level of guaranteed commission is advised?
Commissions are set by the Deal Owner – generally speaking, there is an understood industry average for different types of Deals. Deals which guarantee over £1k are most likely to gain traction, and Deals under £500 are unlikely to be approved.
Most Deals fall into the £1k – £20k commission bracket. For larger transactions like M&A, property, capital raises, and trade Deals, the commissions can be very high – upwards of £500k in some cases.
As far as the split is concerned, it goes 4 ways.
1) c. 8-10 % goes to the people who bring the Deal to the table.
2) c. 50-60% goes to the people who bring the counterparty to the table
3) c. 25-30% goes to the counterparty as a rebate when the Deal goes through
4) 12.5% goes to The Value Loop to run the network and make a profie
3. The pandemic has certainly changed the way in which we communicate and do business with each other. How does The Value Loop champion this new, effective, and efficient method of securing deals?
The Value Loop would exist whether the pandemic had happened or not, but what is proving to be an amazing opportunity for both sides is the fact that there is such a high number of fabulously well-qualified, well-connected people going through huge career upheaval. These people are far more likely to engage with The Value Loop to bring Deals to the table, and share them with their networks now that so many of us are looking to create diverse income streams, and are sweating their networks for opportunities. For people who are natural networkers and relationship-builders, using The Value Loop to monetise their network is a fabulous opportunity to earn very significant income just for interacting with their existing network connections. We think that’s a great win-win-win.
4. Is The Value Loop open to any type of business and industry? What sort of deals are the most lucrative?
As long as you can write a 1-pager explaining what you want to achieve, what your ideal customer looks like, and what you’ll pay the network for success – that’s a Deal. So as long as it isn’t regulated (like insurance broking) or not cool (like selling aircraft carriers or nuclear secrets), then the network will decide whether there is a market for that Deal.
Some Deals are 1-off transactions, like finding a buyer for a business – and the commission here could be £1m+. But there are other Deals with unlimited transactions for high-ticket items, for example B2B companies looking to expand into different markets. Both of these examples are lucrative.
But the most lucrative Deals are the ones in your network that you don’t even know are there until you speak to people and hear what they’re working on – that’s when the golden nuggets start falling out, and you’ll find opportunities they can turn into Deals (in which case you get tagged on to the Chain), or you’ll have Deals you can bring to them that solve their problem (this is where you bring the counterparty to the table – and this is where the largest chunk of commission gets paid).
5. Do you have any advice for those who are looking to become a part of The Value Loop?
The main thing to keep in mind is that the value is ALREADY INSIDE YOUR NETWORK. Sure, there can be high value Deals that enterprising types can go and hustle to close, but it’s far more efficient to talk to your network, find out what they’re working on, put that up on The Value Loop, and let the network do the work of finding the other side.
Likewise, when we share Deal flow with you, some Deals aren’t a good fit for your network, so ignore them. Concentrate on the ones you think your connections would love to hear about – they will happen much more quickly and smoothly, and your connections will think you’re brilliant because you helped solve their problem. Don’t you think they’ll be more likely to pick up the phone the next time you call? Sure they will.
6. You have very ambitious plans for the future – can you share these goals with us?
You mean what are all of our super-secret plans?! Well, OK, I’ll tell you. The first thing is to say that right now there is a potentially life-changing opportunity for those super-connector, networker, relationship-building ninjas out there to start mobilising their networks to use The Value Loop to get Deals done. Networkers who bring in networkers are creating so many commission chains, and as a result so many more routes to cash when these Deals complete. This really is a situation where there is a huge advantage to early adopters.
We want to live in a world where every entrepreneur, regardless of where they are on their journey, can articulate their ideas in the form of Deals, and the network delivers the people they need to make their projects happen. The sooner they can make Deals happen, the quicker value is created. And everyone involved shares that value. If we can shorten the amount of time it takes entrepreneurs to learn how to create value, we know we’re heading in the right direction.
7. How has Introbiz helped you and what would you like to get out of the network?
Carly and Tracey have been brilliant. They have worked closely with us to come up with the right partnership that supercharges each others’ value propositions.
This has taken the form of building a Deal Directory for Introbiz members so we can send Introbiz Deals to our wider network, and Carly and Tracey can preside over a growing catalogue of Deals to share with their members as and when the right opportunities come along.
From our perspective, Introbiz is the perfect network partner because we are just enhancing what they already do. Carly and Tracey have an intimate knowledge of what their members are doing, and what they are looking for – so now they can translate those aims into Deals. And they know which Deals will be well received by those members as well. We’re looking forward to a long and fruitful collaboration.
You can find out more about The Value Loop by heading to their website.
