Red Letter Days

Red Letter Days is a UK company which pioneered the concept of giving experience day vouchers as gifts and corporate rewards.

Red Letter Days was, until November 2017, jointly owned by BBC2 Dragons' Den entrepreneurs Theo Paphitis and Peter Jones, who purchased the company out of administration in August 2005.[1] They revealed on Alan Carr: Chatty Man that they made the decision to purchase the company whilst under the influence of alcohol. Following the acquisition, Jones and Paphitis made the decision to honour an estimated 135,000 Red Letter Days vouchers, to a value of approximately £17 million.[2] They sold the now profitable Red Letter Days 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".[3]

The company is now owned by The Smartbox group,[4] based in Dublin, 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 some sporting tickets to give to her father. She saw the opportunity for packaging intangible experiences as gifts and established Red Letter Days in 1989.[5]

Administration

After a poorly made strategic and financial choice of 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 Jones and Paphitis. 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 the last CEO who she appointed in 2002, while she took a non-executive role.[6]

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. However, Elnaugh blames 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 it related to vouchers that had expired and were not recoverable against the business.[7]

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.

The corporate department at Red Letter Days provides a number of services including incentive programs, team building and event planning to businesses across the United Kingdom, including a number in the FTSE 100.

References

  1. ↑ Dragons breathe life into Red Letter Days James Ashton, Daily Mail, 4 August 2005
  2. ↑ Red Letter Days Trading Update 30 July 2008
  3. ↑ "Red Letter Days sold to Smartbox Group - Travel & Leisure Executive Search - The MBS Group". The MBS Group. Retrieved 2017-12-28.
  4. ↑ "Smartbox Group". www.smartbox.com. Retrieved 2017-12-28.
  5. ↑ Interview with Rachel Elnaugh, Founder of Red Letter Days Tyler Publishing, November 2004
  6. ↑ "Dragon still has fire in her belly". The Guardian. September 29, 2005. Retrieved 8 July 2009.
  7. ↑ Page 169 of Business Nightmares by Rachel Elnaugh
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