![\"newcastle-185x114-e83e6ee1c5b2f5b7946ba34f328f69011541bce7\"](\"https:\/\/www.techsparx.co.uk\/north\/wp-content\/uploads\/2016\/08\/www.v3.co_.ukIMG54192541newcastle-185x114-e83e6ee1c5b2f5b7946ba34f328f69011541bce7.jpg\")
<\/p>\n<\/p>\n
Newcastle digital\u00a0consultancy hedgehog lab has experienced major growth since it was founded in 2007 by Sarat Pediredla and Mark Forster.<\/p>\n
The company aimed to double its turnover every year, and has succeeded in opening offices in London, Copenhagen, Boston, Austin, and Hyderabad.<\/p>\n
It seemed like the app developer would experience another surge of growth after it received \u00a31m in investment from Maven Capital Partners last year. The cash was designed to allow the firm to invest in its sales and marketing function, boost its delivery capabilities and broaden its presence overseas.<\/p>\n
But almost immediately after striking the deal hedgehog lab hit a major stumbling block when a client went\u00a0under\u00a0scuppering a six-figure contract and dealing a massive blow to the firm\u2019s growth strategy.<\/p>\n
<\/p>\n
The company, which had previously been riding high off the back of its huge growth figures, was forced to restructure its business and make redundancies.<\/p>\n
\u201cI think when we finished we had to make 16 people redundant. They were mostly developers. There was some departments we didn\u2019t need and it allowed us to take stock of what we needed. It was cost cutting and we had to balance the books.\u201d<\/p>\n
Sarat describes the breach of contract as \u201cbad timing\u201d as it happened almost immediately after the firm received its investment from Maven.<\/p>\n
With hindsight, the senior team believe that much of the problem was created due to the company\u2019s huge growth rate, which \u201ccomes with its own risks\u201d. Sarat admits that he and his team made mistakes that led to the business being unprepared once pressure was placed on the firm\u2019s finances.<\/p>\n
\u201cWhen you are growing at a breakneck speed, you are going to make mistakes. I have posted on LinkedIn about some of the mistakes we made. Ultimately the buck stops at the top.<\/p>\n
\u201cThe key is, how do you learn from those mistakes and fix those problems? With the experience of 2017 we have grown every year and remained profitable.\u201d<\/p>\n
hedgehog lab\u2019s problems last year stemmed from its success over the last few years and its rapid almost uncontrollable growth. The company now employs more than 140 members of staff around the world, including 65 in Newcastle.<\/p>\n
Sarat is clear that the company is now focusing on growing the business in a \u201csustainable\u201d way, which means having the right safety measures in place to weather external issues such as clients defaulting on payments,<\/p>\n
<\/p>\n
Despite the difficulties that affected the business last year, Sarat points out that the firm still increased its turnover, although profit levels failed to grow.\u00a0According to\u00a0Inc. 5000 List of Europe\u2019s Fastest-Growing Companies it was reported that the firm\u2019s 2016 turnover was \u00a32.4m.<\/p>\n
While growth is understood to have slowed last year the company is now \u201cback on track\u201d and is expecting to report turnover growth of 70% for 2018, at the same time as quadrupling its profits.<\/p>\n
\u201cWe are at the half year mark but we had already booked more revenue by May than we had done in the whole of 2017,\u201d says Sarat.<\/p>\n
\u201cIt could have been 100% if we ramped up at the pace we wanted. We can\u2019t just keep hiring people all the time. We have to balance that out with the risk, the fact that work might dry up.\u201d<\/p>\n
He adds: \u201cWe definitely didn\u2019t foresee some of the problems in that we were optimistic in how fast we would grow. Our stretch target internationally is still 100%, so we are disappointed that we are 30% under target.<\/p>\n
\u201cWe still want to keep growing at 100% as our stretch target but our expected growth in our business plan is 40% over the next three years. We want to keep delivering that. Our ambition is to build a world leading digital consultancy in Newcastle.\u201d<\/p>\n
One of the ways the company is attempting to grow sustainably is through the way it works with its clients. The firm is positioning itself as an investment partner with some of the North East\u2019s biggest companies, such as Northumbria Water, AkzoNobel, and the Home Group.<\/p>\n
The company is also restructuring its senior management team, part of which involves bringing in new members of staff, including Aiden Dunphy, who is chief product officer.\u00a0 He is responsible for the product delivery and he has revamped that process.<\/p>\n
After the problems faced by the firm in 2017, Sarat says that hedgehog lab is back on track. Turnover and profits are set to soar, and the company is currently looking to hire another 10 people to work in its Newcastle office.<\/p>\n","protected":false},"excerpt":{"rendered":"
Newcastle digital\u00a0consultancy hedgehog lab has experienced major growth since it was founded in 2007 by Sarat Pediredla and Mark Forster. The company aimed to double its turnover every year, and has succeeded in opening offices in London, Copenhagen, Boston, Austin, and Hyderabad. It seemed like the app developer would experience another surge of growth after […]<\/p>\n","protected":false},"author":1,"featured_media":3378,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[19,20,31],"tags":[131],"class_list":["post-1457","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-innovation","category-jobs","category-tech-sparx","tag-newcastle"],"yoast_head":"\n