The rise and fall of Rob Cotton
Almost five years ago to the day that I first met Rob Cotton, the high profile chief executive of Manchester-headquartered cyber security group NCC stepped down.
He’d come under increasing pressure as lost contracts, profit warnings and a falling share price had created a perfect storm. Many people I’d spoken to were surprised he’d lasted as long as he did.
So who is Robert Francis Charles Cotton and what went so wrong in the five years between our first meeting on February 28, 2012 and the announcement on March 1, 2017, that he'd left the company he'd done so much to build?
Going back to the beginning, our first meeting took place in Cotton’s office at Manchester Technology Centre. It overlooked the old BBC office and was full of various framed shirts of his beloved Manchester United and reminders of his other passion for cycling.
However it lacked the sparkle that reflected Cotton’s vision for the business, which is one of the reasons why NCC is now preparing to relocate into the state-of-the-art XYZ building in Spinningfields, ironically without the CEO who drove the move at the helm.
Image is important to Cotton. From his penchant for sharp suits, crisp white shirts, nice cars and seemingly permanent tan, he told me that he used to go over to his villa in Portugal if he needed some sun.
However, beneath the shiny exterior was a formidable competitive streak, which can be a strength but also a weakness.
As long ago as 2012 Cotton stated his intention to turn NCC into a £1 billion business and tweeted regular updates on his Twitter account.
Cotton spoke in-depth about Harold Wilson’s famous white heat of technology speech and his passion for creating a major tech business in Manchester was obvious.
However I quickly saw the other side of him. He mentioned he played football two or three times a week at NCC and I joked that at his age (he was 47 then) he might get replaced by a younger player. The mood change.
“That WON’T happen,” was his response. And if the unthinkable did happen, and he was dropped, he said he would practise harder, train harder and play harder than people half his age to get back into the team. He was deadly serious.
“Whatever Rob does, he has to be the biggest and the best,” was how one acquaintance described him.
He might not have the 25.8 million followers that Donald Trump has on Twitter, but Cotton has never been afraid to use the social platform.
Critical tweets about Manchester United’s form, congested roads and lost luggage were interspersed with his latest times on the cycle track, stunning views from the hotels he stayed at around the world and his various injury woes.
However for a long time, Cotton’s brash character was a perfect fit for a fast-growing company like NCC.
Let’s not forget what he achieved during his 17-year journey there, 14 years as CEO. During that time he took the business from a £10m escrow provider to a highly profitable £200m global leader in cyber security and risk mitigation.
He oversaw a series of acquisitions, led the business onto AIM in 2004, main market in 2008 and last year the business entered the FTSE250 for the first time.
It now employs more than 2,000 people across the group’s 35 global offices – a far cry from the business he inherited.
So at a time when everyone has been talking about the threat of cyber terrorism, what went wrong?
Not all his acquisitions were successful. Building a £1bn company is one thing, but integrating all the businesses is quite another. Sources I spoke to said the 2015 purchase of the Dutch cyber security firm Fox IT for £93.5m was particularly challenging.
At the time Cotton spoke of the need to get “on the front foot” and announced NCC would be moving to the state-of-the-art XYZ building in Spinningfields.
For years everything Cotton touched had appeared to turn to gold but in 2016 the first signs that something was wrong began to surface as NCC experienced problems in its cyber security division.
The company lost three key contracts and issued the first of two profit warnings in October 2016. In the same month Cotton posted on Twitter: “Contrary to the insanity of the week @NCCGroupplc is still the same great company it was a week ago!!! #GreatPeople.”
A week earlier he tweeted: “New York, let's hope for a better day after a fairly stupid one in UK!!”
New York..let's hope for a better day after a fairly stupid one in UK!!— Rob Cotton (@RobCotton1) 20 October 2016
Although NCC did reach Cotton’s target of becoming a £1bn company, its descent has been even quicker than its meteoric rise. At the time of writing this column the company has a market cap of £332m.
Last week a second profit warning was issued and on March 1, 2017, it was announced that Cotton had “stepped down” with “immediate effect”.
The departure raises as many questions as it provides answers. Who will succeed Cotton? Will the management style change? Where will the focus be? What will happen to the share price?
And what of Cotton? His considerable achievements shouldn’t be forgotten – along with the large amount of money he raised for charity – but the fact is the company he helped create decided its future was better off without him.
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