"Office rent? Pah!"

by Kate Pritchard - Friday, 16th November 2007 -

Mike Lawton wanted to base his fledgling company on Oxford’s Milton Park. But there was no way he could afford the sky-high rent. What did he do?

As luck would have it, Lawton bumped into the managing director of the business park at a local seminar. “It was chance meeting,” he says. “I was only there for the free food. But we got chatting and I explained my predicament.”

Lawton had recently been made redundant from telecoms firm Bookham Technology, one of the dotcom darlings. The company had been based on Milton Park and over 2,000 people had lost their jobs.

So, in 2003, Lawton gathered together some of his old colleagues and set up Regenatec, which designs pure plant oil biofuel conversion systems for commercial diesel engines.

“I had my redundancy cheque – just under £20,000 – and switched to interest-only repayments on my mortgage. But I knew we still wouldn’t be able to afford office rent. A 3,000 sq ft office on Milton Park costs a whopping £6,000 a month.”

So Lawton struck a deal with the park’s MD. For a ten per cent stake in the company, Regenatec would be given a fully-serviced office for 3.5 years.

It was the first rent-for-equity deal in the country.

“Now we don’t pay a penny in rent. We don’t even pay our phone bills,” says Lawton.

Read more about Lawton’s start-up here.

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