LSE drop-out develops successful business

I am being shown around various apartments of Unida Place, which can be rented out for as little as 150 pounds per week in central London locations, per room of course. It is Dan Burton, a very entertaining ex-student from LSE who tells me about his 30 properties portfolio. He has managed to build it up since he quit the prestigious academic institution to pursue his own lessons in economics.

Dan has been involved in entrepreneurship since leaving school in 2006. In his gap year whilst working for Deloitte 9 to 5, he started a socks company, SocksOn.co.uk which he ran in the evenings, weekends, and sometimes during office hours. Socks On delivered 3 pairs of fresh, matching socks every month. It was a really cool idea, just too good to be true. The firm did not grow into a truly international business, but it taught Dan a lot about starting and failing, and along the way the company was voted best Start Up company in Yorkshire 2007, and was featured in several broadsheets, such as Esquire magazine. Dan’s business partner even got the opportunity to appear on the daily chat show Richard and Judy, to promote the business and discuss whether or not to go to university.

Alongside this, he has been working with Utility Warehouse to sign up households for cheaper utilities. He received a commission based on the amount customers spent every month. Building up his portfolio of utility customers across the UK has been an adventurous journey and taught him a lot about sales and taking rejection. Dan started off signing up students, then small businesses and eventually moved to bigger buildings such as care homes. He was running this alongside his studies, until he decided that he had enough of wasting his time thinking about what he should be doing at every moment of time: ‘I felt guilty building the business and earning money, because I thought I should be studying, but when I studied I had that little voice in the back of my head saying that I shouldn’t be learning how to manage people from a text book.’

During the summer of 2009, Dan came across the problem of friends and friends of friends looking for rooms in Central London at sensible prices, but there was a severe lack of supply. There were lots of rooms in halls available (starting at £220 per week), but not many clean, nice rooms in flat shares. The first opportunity came when Dan’s flat mate moved out of his flat in Holborn. Dan was quick to pounce on the opportunity and after speaking to the landlord, rented the room to his friend’s brother and made a small margin on the rental price. This was the initial model: helping people to rent out their spare rooms, and helping students and young professionals to find somewhere nice to live in central London, with good travel links at reasonable rents.

Dan expanded this model over late 2009 and 2010. He persuaded Judith, a friend and Deloitte colleague with whom he entered a management consultancy competition, to join the now formed company. In June 2010, Dan faced a dilemma: whether to continue the business part time, or to focus all his time on it. ‘My exams hadn’t gone very well, and I really thought the business had a chance.’

Business has gone well for Dan, who now runs a small but dedicated team from an office in Holborn (‘literally about 30 metres from the first room I rented out’), and has big plans for expansion over the next 5 years. ‘I think students and young professionals really deserve a nice place to live, with good travel links, at a fair rent, without being ripped off by the big student hall operators, or not being looked after by the average letting agents, who don’t really care about their tenants as much as they could.’

Asked what lessons a young student can learn from his success story, Dan tells me that quitting university is not a recommended option – you’ve got to want it. He explains that he took this decision, because ‘I am not smart at multitasking, and I couldn’t balance university study and building the business – shown in my exam results, and I much prefer helping people than running stats from a spreadsheet’.

Dan stresses that patience and hard work are crucial, and he learns something new every day at a business one would think is so simple, because after all it’s just renting rooms and flats. Going into a market which is as competitive as real estate is challenging, but there are many people willing to help. He has found 2 fantastic mentors and is working passionately towards his vision of housing 20,000 students and young professionals in Central London by September 2016!