Red Letter Days is a UK company which was an early adopter of the concept of giving experience day vouchers as gifts and corporate rewards, based in Borehamwood in the offices of its parent company, Buyagift. The company is now owned by French firm, The Smartbox group, based in Dublin since 2016, who offer gift experiences throughout a number of European countries.
History
The company was founded by former Dragons' Den entrepreneur Rachel Elnaugh, who developed the idea for Red Letter Days after creatively packaging cricket tickets to give to her father. She saw the opportunity for packaging intangible experiences as gifts and established Red Letter Days in 1989. The business began to take off after placing brochure inserts into national newspapers and magazines in the lead up to Christmas, 1990. Rachel Elnaugh admits that Red Letter Days struggled after a "disastrous over-expansion in 2002." In 2005, Sir Rodney Walker was listed as the chairman in anticipation of listing on the Alternative Investment Market, hoping to float on the stock market later that year.
Administration
After expanding via supermarket distribution, Red Letter Days went into administration on 1 August 2005; the remaining assets and goods were bought by fellow Dragons' Den entrepreneurs Theo Paphitis and Peter Jones in 2005. They revealed on that they made the decision to purchase the company whilst under the influence of alcohol. Following the acquisition, Jones and Paphitis said that all vouchers bought on a Visa or credit card had been honoured as well as corporate customers. Although Elnaugh was at the helm before and at the time of the company's failure just days after the birth of her fourth child, she blames the problems on the actions of a previous CEO, Simon Vincent, who she appointed in 2002 but who left the company two years before in early in 2003, while she took a non-executive role. ITV1's "Tonight Programme" had a more critical explanation of the demise of Red Letter Days, including unpaid suppliers and disappointed purchasers. The programme suggested the business model failed to escrow or earmark supplier payment equity, instead using it for working capital. Whilst Elnaugh blamed the company's bankers, who placed £3 million in a bond which they refused to release for use by the firm despite the fact that some of it may have related to vouchers that had expired and were not recoverable against the business. It was the funds held by the credit card company under this bond which enabled the new owners to honour vouchers issued prior to the company falling into administration. Mrs. Elnaugh admitted in her book “Business Nightmares” that her finance team had lost track of the company’s voucher liabilities and its debts to suppliers. After Red Letter Days went into administration with a balance sheet deficiency approaching £9 million, Elnaugh left the Dragons' Den.
Restart
Under its ownership since 2005, Red Letter Days has continued to offer a wide range of experience days, including car racing, skydiving, white water rafting, hot air ballooning, paintball and bungee jumping as well as day spa experiences. Under Paphitis and Jones' ownership, the company went from administration to an annual turnover of over £20 million. They sold the now profitable Red Letter Days to Buyagift for an undisclosed price, claiming that "the time felt right and the sale will ensure an exciting and progressive next chapter in Red Letter Days' evolvement".
Buyout
Red Letter Days was bought by the French multinational company Smart&co S.A.S in 2017, joining other brands like Buyagift, Dakotabox and Odisseias. In June 2019 records at Companies House show that the ownership of the company transferred to Buyagift plc and the limited company was put into voluntary liquidation with a declaration of solvency. The founder of SmartBox, Pierre-Edouard Sterin, and the CEO, John Perkins, resigned and a new CEO, Olivier Fajour, was appointed.
