Business · interviews · Sunday Times

How I Made It: Martin Ephson, co-founder of Fermoie

BEST FRIENDS Martin Ephson and Tom Helme closed the deal of a lifetime in April 1992 when they took a majority stake in Farrow & Ball, the paint and wallpaper maker that had fallen on hard times.

“The company was selling decorative and specialist paints that nobody else made in Britain any more,” said Ephson, a corporate financier called in by his old schoolfriend Helme, a restorer who was working with the National Trust.

The pair set aside two days a week to turn round the business, which then employed 14 staff and was run from a converted barn in Wimborne Minster, Dorset, and turning over £500,000 a year. “That was our first mistake,” said Ephson. “It was full time from the beginning.”

After two years they sold their homes and left their day jobs to run Farrow & Ball, which dated back to the 1930s. “I said to my wife, ‘Either I take this seriously or I give it up’,” said Ephson. “We were fortunate that all the elements we had worked so hard on came together.”

It paid off. By 2006, when they sold Farrow & Ball for £80m, the factory had expanded from 6,000 sq ft to 60,000 sq ft and employed 300. Sales soared to £28m, generating a profit of £8m a year.

“We had a great product but we had to change the whole back office organisation, from selling and receiving orders to processing and distribution — absolutely everything,” Ephson said.

The pair cut all ties when they sold out to private equity house European Capital. “Farrow & Ball was our baby and we didn’t want to stand on the sidelines while someone dismembered it,” said Ephson. “In the end we left a lot of gas in the tank and the new owners bought into our business model.” The company was sold again last week to an American private equity firm, Ares Management, for £275m.

With £40m each and a wealth of experience, the pair sought another venture to get their teeth into. But it wasn’t until 2012 that they reinvested some of their wealth into launching the fabric maker Fermoie, selling a palette of colours and patterns designed to appeal to Farrow & Ball customers.

“We looked at hundreds of old fabrics, trying to work out how they were printed,” said Ephson. “Eventually we found an Austrian manufacturer — it was their first English inquiry for 25 years.”

Fermoie employs seven at its head office in Marlborough, Wiltshire, and has a showroom in Chelsea, west London. Sales reached £684,000 in the year to March 2014. It expects to become profitable next year and report revenues of £1m.

Fermoie now manufactures all its own products. It has invested in German machinery for the screen printing and drying of fabrics, and is attracting interest from designers and manufacturers.

The success of Fermoie is easy to explain, said Ephson: “We chose fabrics because we understand the interior design industry and have an operational template for it that we know is successful.”

Ephson, 58, was born in London. His Ghanaian father was the country’s first diplomat when it gained independence in 1957 and he grew up in Cairo, Tunis and Accra as well as in Europe.

Ephson’s mother was a secretary before she married. “My parents met in England just after the war,” he said. “Mother was called into the Colonial Office and told not to marry a communist, which caused a stir in the papers at the time.”

Ephson boarded at Charterhouse in Surrey, where he met Helme. He graduated from the Polytechnic of Central London (now the University of Westminster) in 1977 with a “very poor” degree in economic history. “It was fun living in London but it wasn’t great academically,” he said.

Homesick for Ghana, Ephson returned that year to work in the food trade. He also set up a fish farm. “I had a variety of jobs but exporting live tropical fish all over the world was the most enjoyable and profitable.” On his return to England in 1981 he built his own food distribution company called Larsens Maritime Services (LMS).

“We did all the duty-free drinks for the QE2 and one year I was the world’s largest caviar dealer, with three tons of the stuff,” said Ephson, who sold out to Sea Containers in 1987. “I didn’t make a lot of money but I learnt a lot.”

He went on to be a consultant in mergers and acquisitions for six years before Helme introduced him to Farrow & Ball, which produced a range of paints for the National Trust, where Helme advised on decoration.

After Farrow & Ball, Ephson took it easy. He travelled the world, spent time with his young family and set up the Martin and Eugenia Ephson Educational Trust, a charity educating children in Ghana.

He lives in Wiltshire with his wife, Eugenia, a collector of contemporary art. They have three children, Ciara, 26, Patrick, 24, and Ludo, 21.

Ephson’s advice to aspiring entrepreneurs is: “You need focus and commitment. Keep your goals simple and communicate them well to your team. You also need faith that running your business is going to be worthwhile.”

Link to article in the Sunday Times

PDF – Martin Ephson of Fermoie

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