My scale-up journey: David Hammond, Chiptech

After forming Chiptech UK in 2019, the business has experienced consistent and rapid growth, year on year.

Chiptech, which currently employs 33 staff and has a turnover of £16m, has been recognised for its journey to date by picking up the Red Rose Award for Scaleup in 2023 and again in 2024, along with Small Business of the Year in 2023 and Medium Business of the Year in 2024. To facilitate Chiptech’s growth and expansion, the company recently relocated to the historic Palatine Hall, Dalton Square, in the heart of Lancaster.

Lancashire County Council's scaleup service, Two Zero, caught up with CEO David Hammond, who speaks candidly about the rewards, challenges, and opportunities he has faced as a scaleup leader and provides valuable top tips to fellow business leaders.

Lancaster-based Chiptech manufactures and sells innovative digital assistive technology products to support elderly and vulnerable people. These products are sold to local authorities, housing associations and care providers across the UK.

By 2022, the company’s growth had seen it secure a significant percentage of the digital assistive technology market in the UK. Still, by this point, its rapid expansion over the previous three years had led David and his team to almost breaking point.

David said: “There is a growing market for products to help people with assisted living. The quality of our products and service meant we grew rapidly – success generated success”.

“The business grew from a single person to a structure supported by a senior management team of three people by the end of 2022. The roles and responsibilities of that team were fit for a small business. However, it was clear that this was not sustainable enough to take the business to the next level, and the senior management team was spread too thin to fulfil our responsibilities and support further growth.”

Pressure on the Business

“The pressure on the business caused the senior management team to shoulder extra responsibility, but tasks were diluted. We were beginning to break, a team of three can only do so much.”

David took two days away from the business to reassess Chiptech’s position and strategy. During this time, he developed a structure that would allow the company to continue to grow. He identified the resources he needed to achieve and maintain high service levels while upholding the business’s core values.

David realised during this time that recruiting an expanded, strong leadership team was vital to the business’s success as it continued to scale.

He said: “Taking the time to develop that business structure allowed me to understand what roles we required in the organisation. We needed to recruit into our senior management team, rebuild foundations, restructure, and reset roles and responsibilities fit for a medium to large business.”

“Over the next three months, I recruited and headhunted the best in class. Having the right people on your team who share common values is important.”

Continued growth

With the new team and strategy in place, the business continued its expansion and has doubled its turnover each of the past two years, growing from £4.1m in 2022 to its current £16m.

There is no sign of this rate of expansion slowing, with Chiptech aiming to triple in size over the next three years.

The company, which has been based at Lancaster University for most of its existence, recently moved into one of Lancaster’s heritage buildings, Palatine Hall, a 12,500 sq ft premises to facilitate its ongoing growth. Originally constructed as a Roman Catholic church, later repurposed as a cinema, then offices, Chiptech has ambitious plans for its future by significantly modernising and safeguarding its headquarters, enlisting the specialised expertise of local architects, HPA.

David said despite difficulties in finding a new space suitable for the company over the coming years, it was vital for Chiptech to remain in Lancaster.

“Lancaster, and Lancashire as a whole, is a phenomenal place to live and work. The people are brilliantly hardworking with a great sense of humour,” he added.

“I think a big challenge Lancashire businesses face is encouraging people who attend university in the county to stay after their studies. As a company, we want to help with this and regularly offer students internships and work placements. One of our first interns is now a senior management team member!”

Scaleup lessons

Reflecting on the company’s scaleup journey, David shared some top tips for fast-growing companies in Lancashire.

He said: “Don’t underestimate the power of building an industry and local network. It creates a support system in and out of the workplace.”

“If you feel something needs to change, don’t procrastinate. Make your decisions, then put them into action.”

“It’s also vital to know your target market inside out. Taking the time to research your target market thoroughly will be time well spent. It will enable you to fully develop your proposition, market routes, and unique selling points.”