Daniel Harrison is stepping down as chief executive of True Potential - the company his father David founded in 2007 - and may leave financial services altogether.
After 17 years with the Newcastle-headquartered company, and more than 25 years in financial services, Harrison has told FT Adviser it was time to “step back”.
The announcement was given to staff today (October 3) at True Potential’s annual conference.
The world of UK financial services has changed significantly over the years, and True Potential is no stranger to change. “The company has a bright future ahead in this fast-changing world”, Daniel Harrison said.
In 2021 True Potential sold a majority stake of its business to private equity firm Cinven for an undisclosed sum. At the time, the firm said the investment would enable it to continue its double-digit growth and develop its investment technology platform.
Until 2019, True Potential was owned by American private equity firm FTV Capital but the company bought itself back - though FTV retained a minority stake in the business.
Then, in November last year, his father David Harrison said he was retiring, though he kept his small shareholding in the company. But Daniel’s own departure was already being discussed in the boardroom at the same time.
Planning to leave
He will step back from October 11, but the planning for his departure began over 12 months ago. “Twelve months seems a long time but it has come quickly."
Three years ago, the board of directors agreed a three-year term for Daniel Harrison to stay on with the business and make sure there was the “right team and the right processes in place. It is very much a mission accomplished”, Daniel Harrison said.
Private equity firms usually operate on a three-to-five-year cycle. While he could have stayed another three, five or even 10 years; and the board would have been “happy” for him to stay on, Harrison said he could not commit to another three years and felt the time was right for him to step down.
Harrison was keen to stress that Cinven is fully committed to True Potential, and there is no sale on the cards.
However, Harrison explained that it is generally wise for owners or family members within a PE-owned business to understand they could get in the way of any sale process or future changes, because any future development could "become about ‘me’ rather than the company".
“I don’t know what I want to do in the next three to five years. I’m young, I have plenty of ideas and options, and committing to another three years or so as CEO would not be the right thing to do.”
According to Harrison: “The board has been very supportive and great to work with. We have planned everything all the way through and though emotionally it is hard for me to step down, because this is all I have ever known and I enjoy working with my colleagues and clients, I am proud of the legacy I will leave behind.”
