Putting your money in a company listed on the Alternative Investment Market
is much like placing your chips on black in a casino, if you believe some
Accusations of an unregulated market where anything goes have been flying
across from the other side of the Atlantic, but these are firmly refuted by
those at the sharp end the directors of AIM companies, their advisers and
investors. And it is not a staging post for those looking to move on to larger
Often the opposite is true many finance directors of AIM-listed companies
began corporate life with companies on the full list, but have been lured to AIM
by the prospect of helping a business grow and develop.
‘AIM was always seen as a second division, but it has really moved on,’ says
Douglas Kearney, FD of SovGEM, an AIM-listed emerging market finance provider.
‘There were institutions that were a bit sniffy about it but they have now
joined the club and participate in deals.’
He agrees that these days, institutional investors see little difference
between an AIM-listed company and a smaller company on the full list. ‘I can’t
imagine that any institution would turn around now and say we won’t invest
because it is AIM,’ Kearney says.
End of the stigma
The same is true for finance professionals looking for the next step in their
career few would dismiss an opportunity purely because of the market that the
company was listed on.
‘I wouldn’t see it as a natural stepping stone [to a FTSE company] because
often, by the time they come into a CFO position, people have concluded that
they either want to be with a medium-sized AIM company or they want to be with a
very large FTSE company,’ says Steve Maslin, head of external professional
affairs at Grant Thornton, the largest adviser to AIM companies.
‘Quite often they might have gone through the route of qualifying with one of
the large audit practices, moving through the finance team of a large company
and then moving up, or they might have decided that they prefer the benefits of
an AIM company.’
These benefits, according to Maslin, include a greater opportunity for a
hands-on role in formulating a company’s strategy. He adds that CFOs will often
achieve their ambitions by helping a company grow, rather than seeing it as a
stepping stone to a larger company.
So although they might not be mutually exclusive, it seems it takes a
different breed of professional to step up to the CFO plate at an AIM company
rather than a larger listed group. Nor is it a soft option. As Maslin says: ‘I
don’t think any CFO has been tempted to move to an AIM company because they
thought they would get an easy ride.’
Clive Davis, regional director at recruitment firm Robert Half International,
looks for certain qualities when searching for an AIM finance chief. ‘The number
one request from all of the organisations we have worked with was strong
negotiation and presentation skills,’ he says, ‘because a large proportion of
their time is involved in negotiations with banks. The difference would be found
in their ability to communicate in what can be fairly tough and detailed
And who would be attracted to such a role, which can be fast moving and
under-resourced? ‘We often find that people who have worked their way up can be
particularly interested in these opportunities,’ says Davis.
‘They see it as their opportunity to be part of a seed that will go on to
become a larger plc,’ he adds. So in this respect, such a move could be seen as
a stepping stone, but in this situation the FD moves with the whole company.
Matthew Turnock, FD at AIM-listed Fountains, an environmental services group,
agrees. ‘Managing smaller companies through growth phases is an extremely
challenging environment, which requires very particular skillsets.’ But, like
many of his peers, he is keen to stress that AIM is not, in his words, ‘a
Do you have what it takes?
Time management: As Fountains FD Matthew Turnock says: ‘There is a lot that
you need to learn around personnel management and personal time management as it
is very easy in a position like this to be get totally swamped.’
Principles: No matter what size company you work for or where it is listed,
you still have responsibilities, according to Grant Thornton’s Steve Maslin.
‘Always stick to your principles as you only have one chance to make a first
Thick skin: FD at SovGEM, Douglas Kearney, says: ‘On a public market you are
exposed, people can be quick to criticise.’
Business agility: ‘You will be less well resourced and you have to be
prepared to role up your sleeves and get stuck in. This can be quite a challenge
if you have come from a large firm,’ says Maslin.
Don’t ignore the fundamentals: Irrespective of the regulatory regime, lighter
or otherwise, you still have a business to run. Turnock says: ‘You need strong
sales pipeline, work that is executed profitably, get the bills out of the door
promptly, and remember cash is king. Anyone in a new position needs to make sure
they have got a handle on that cycle, right from the sales side through to the
cash being in the bank.’
Don’t miss the opportunity: ‘We speak to senior finance professionals who
have been happy with their careers who say they would have liked to have been
involved in an AIM-listed company. It can be a roller coaster, but very exciting
at the same time,’ says Robert Half’s Clive Davis.
Does Darwin's theory apply to taxation? Colin ponders...
The EC has been instructed to draft a European Union (EU) directive authorising an EU financial transaction tax, which would apply to ten of the EU’s 28 member states
Accountancy watchdog the FRC has dropped its investigation into the former chief financial officer of Tesco, nearly two years after the supermarket was engulfed in an accounting scandal
Colin imagines how Apple's logo might change in the wake of the EC's ruling over its Irish tax arrangements