This is a case study featured in our From inmates to entrepreneurs report. Click here for the full report page
When Duane Jackson was just 13 years old, an educational psychologist concluded that he was a bright boy who would “either end up as a master criminal, or a successful businessman”. Instead, Duane fulfilled both predictions by first becoming – perhaps not a master – criminal and then a successful entrepreneur, founding innovative business accounting platform KashFlow in 2005.
It isn’t particularly hard to explain why Duane ended up on the wrong side of the law. Living in care homes from the age of 11, instability was a constant theme in those early years. By 15 Duane had left education – having been expelled twice – and had begun mixing with the “wrong kinds of people”. When money troubles hit in his late teens, Duane didn’t hesitate to help some acquaintances who needed some drugs transported to the US; at the time, a single ecstasy run to New York paid around £1,000. In 1999, aged 19, he was arrested for drug trafficking and money laundering in Atlanta. He was eventually extradited back to the UK where he was sentenced to five years at HMP Camp Hill.
Even before his run-in with the law, Duane had already demonstrated evidence of an enterprising personality. While in the care of social workers, he taught himself to code using a ZX Spectrum computer, and had started earning decent money as an IT contractor. Those skills proved unexpectedly handy in prison, where after completing a two-week computing workshop in a single day – “I felt like showing off a little” – Duane was invited by the instructor to stay on and teach the course to other prisoners. On the inside, he astonishingly found a way to continue working for a company he had contracted with before prison, by writing code with pen and paper and using a hacked prison phone to talk them through it.
The next step in Duane’s journey was a transfer to an open prison (HMP Ford), though not without some difficulty – “the Camp Hill prison governor didn’t want to start paying a professional IT instructor £30,000 when he had me at his disposal”. At Ford, he attended an evening seminar on entrepreneurship run by The Prince’s Trust in the prison, and began to consider setting up his own company post-release, “something I hadn’t done before”. That idea had time to gestate, as upon release in 2002, Duane – after completing the Trust’s Enterprise Programme and receiving several thousand pounds worth of funding – initially returned to work as a freelance contractor. He credits the support of a scheme known as the New Deal – no longer in existence, but similar to the current New Enterprise Allowance (NEA) – which allowed him to keep receiving his benefits for six months during a “test trading” period of self-employment.
The premise for Duane’s first business came about somewhat accidentally. Dissatisfied with existing accounting software that was expensive and required installation on a specific computer, he created his own “cloud” platform – accessible anywhere – to help him manage his financial flows. Duane began to believe that his invention, which came to be known as KashFlow, could help lots of cash-starved sole-traders and SMEs unable to afford the upfront cost of accounting software but willing to pay a regular subscription fee. Unsure of how to progress, Duane returned to The Prince’s Trust for further (non financial) help in developing his business.
Another important moment was a meeting between Duane and Lord Young – former trade and business secretary under Margaret Thatcher – at an event hosted by the London Youth Support Trust, which convinced Lord Young to join KashFlow as a mentor and investor. From that point on the firm experienced steady growth and acquired thousands of customers, despite Duane’s refusal to accept equity finance: “I had lost control of my destiny once by going to prison, and I didn’t want to give it away again”. In 2012 Duane sold KashFlow for around £20 million – “it was a very compelling offer” – and is now busy with his latest venture Supdate, a business reporting platform that enables small companies to update investors on their progress.
Duane is acutely aware of the difficulties of life as an ex-offender – he still pays four times the going rate on his home insurance – and passionate about improving the prospects of people with convictions. While at KashFlow, Duane made sure that several of the company’s 40 or so employees were ex-offenders, some of whom have gone on to bigger and better things. Upon selling the business, Duane wrote a £100,000 cheque to The Prince’s Trust to support their future activities. He has also been a mentor for the charity, and now sits on their advisory board.
He strongly believes that many prisoners are suited to entrepreneurship: “Calculated risks, buying in volume and selling in smaller quantities at a higher price, dealing with competition, paying workers, strategic alliances. The list of parallels go on and on. There are some very very good entrepreneurs in prison – imagine they used those powers for good instead of evil!”