When River Capital invests in a business to scale it and take it onto the next stage of growth it will often bring in new non-executive board members to support the change and their input can prove critical. Tony McDonough reports
For a business to expand and reach its potential, significant change is often required – it is both exciting and daunting, and cool, experienced heads can prove critical to the process.
Liverpool-based SME funding specialist River Capital offers decades of experience in transforming entrepreneurial start-ups into structured, scalable ventures. It recognises that existing management teams often need help and support.
This is where the role of non-executive board members can prove critical to the success of a project. Something that Gary Lasham, a man with decades of experience in both private equity (PE) and manufacturing, can attest to.
His input has proved invaluable in the success story of Barons Contract Furniture, a North Lancashire firm River Capital supported in 2023 with a seven-figure cash injection to back a management buyout.
Barons, which has 50 years of experience crafting and supplying contract furniture and soft furnishings to a broad range of sectors, including senior living, hospitality, and healthcare, has prospered in the time since the deal was struck.
In their most recent accounts filed on Companies House, for the 12 months to September 30, 2025, Baron showed a 27% increase in revenues to £13m and an operating profit in excess of £1m.
PE investors are skilled at identifying businesses with untapped potential – often companies that have outgrown their founders’ original capabilities. While entrepreneurs are adept at building businesses, scaling them requires a different mindset.
“When a business becomes a teenager, they need a whole different skillset to take them through to adulthood. What PE is very good at doing at the SME level is spotting businesses that have potential,” Gary said in an interview with LBN.
“But, if you like, they have outgrown the entrepreneurs that set them up. What they can bring is the necessary finance to take it to the next stage.
“Of course it is a risk. Banks don’t tend to risk money, but PE does. And what they do is they bring a team together – a CEO and a board of non-execs to take those businesses to a new level. They are all about growing businesses and ultimately, of course, for shareholder benefit.”
Gary’s own PE journey began in 1998. He had been running a big engineering business in Speke in Liverpool called Metal Box. He succeeded in turning the struggling businesses around, turning a loss into a profit.
That brought him to the attention of Liverpool PE outfit 3i. It was looking to buy a printing business in Stockport and, after the project’s success they did another deal for a Bradford firm in 2004, where Gary remained for several years.
His journey led him to furniture manufacturer, Belfield Group, where he was chief executive from 2019. He navigated the business through the pandemic before departing in 2022 and, at the request of River Capital, came on board as chair of Barons.
Gary said: “The deal was completed in June 2023. I had become involved before that working with the buy-out team about six months before. River Capital brought me in because they wanted someone with sector and private equity experience.
“On day one we found that we had a super business and super people but what we needed to do was put the controls, the governance, the health and safety regimes in, the clear sense of objectives.
“So, an example is bringing in monthly accounts, setting budgets, having monthly management meetings and a clear three-year plan. I am very strong on health and safety and getting that culture right. Employees will recognise you are looking after them.
“It was all about cultural and governance change and supporting the team through that. It wasn’t that they didn’t know what they were doing, it’s just they had never been through that before. A big part of my role is to support them through that process.
“Buying a business is quite a daunting prospect, especially if it is for millions of pounds. And you are taking people who probably don’t have the exposure to that level of finance and responsibilities. It is a complete mindset challenge.”
Non-execs are called that for a reason. They don’t have operational control of the business and Gary insists it is crucial that anyone taking on a non-exec role for the first time explicitly understands this.
His role as a non-exec, he explained, is to support and enable. He added: “I think the biggest mistake a non-exec can make is to think they are running the business. I don’t run the business. The MD (in Barons this is Garry Smith) and the management team run the business.
“That is the most important thing when you make that transition from an executive role to a non-exec. When I was operational, I ran the show. I don’t run the show now. I am there to support the team, to say things like ‘I’ve seen that problem before, this is what we did last time’.
“After around 40 years in business in the UK manufacturing sector there are not many things I haven’t seen, apart from COVID. I’ve lost big customers, I’ve won big customers and I have had to make redundancies and recruit teams to turn businesses around.
“All these things are in my toolbox. The lines can become blurred. That is a risk. That is why it is important to be clear that the MD and the management team run the business. We are here to support and guide.”
In the SME market, PE operators play a hugely important role in investing and scaling high-growth potential businesses. They are seen largely as a force for good.
And Gary is full of praise for the work River Capital performs in the North West market. He explained: “River Capital’s role has been crucial to the success we have seen at Barons.
“I have worked with many PE companies, and I think River Capital is particularly supportive and involved. They are at every board meeting and I speak with them on a weekly basis.
“That is all based on us being successful, but they have been super supportive, and I can’t praise them highly enough. They have local knowledge – they know the markets, the people and have a fantastic network of contacts that we can tap into.”
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Gary believes Barons is an example of best practice in terms of PE investment into SMEs. He added: “Of course it is a risk. Banks don’t tend to risk money but PE does.
“And what they do is they bring a team together – a CEO and a board of non-execs to take those businesses to a new level. They are all about growing businesses and ultimately, of course, for shareholder benefit.
“At Barons we have increased sales by 50% since the acquisition and created a fantastic culture where people understand where we are going. We communicate with the whole team. We have doubled the floor area which gives us the physical capacity to grow.
“It is a place where people are now proud to work – it has come on in leaps and bounds. On any metric, the business is in a great place, not just for today but for tomorrow.”