A Bristol entrepreneur who came up with the idea for his tech business while studying at the University of Bath has become a millionaire after selling the company.
James Courtney came up with the concept for rewards scheme app Lux Rewards after winning a university business plan competition in 2015, then aged 21. His idea was to develop “the air miles of the restaurant world”.
The company started out as a dining rewards app, connecting customers with high-end restaurants, but found success after pivoting to a business-to-business model, partnering with major banks, airlines and employee benefit platforms to offer card-linked rewards.
The business has now been bought for an undisclosed eight-figure sum by software giant Enigmatic Smile.
Although Lux Rewards received early backing from the Just Eat Accelerator and local angel investors, the start-up struggled in its early years. At one point in 2019, the business was just two weeks from shutting down entirely.
“I had put everything into Lux Rewards,” said Mr Courtney. “In those early days, I was literally walking into restaurants, trying to convince them to join the platform. I even worked with The Clifton Sausage to hand out free samples on the streets of Bath just to get people to download the app.”
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Despite relentless efforts, growth remained elusive. One “particularly painful moment” came when Mr Courtney spent £1,000 to put on an exclusive event at a wine bar, offering free wine and tapas in a bid to win over a major Bristol accounting firm. “Only one person turned up,” he recalled. “It was the most embarrassing day of my life.”
By early 2020, Mr Courtney had resigned himself to the business failing. A Crowdcube fundraise that year provided crucial funding, but the pandemic hit just as the round closed. With restaurants shut and the business burning more than £25,000 per month, Mr Courtney, with his team on furlough, moved back to his family home in Bristol.
It was during this period that Lux Rewards, which was co-founded with Tom Munday and Ash Dey, pivoted away from direct consumer downloads to partnerships with businesses. The turning point came in 2021 when the company signed a major deal with Barclaycard, expanding from 1,000 users to 400,000 overnight. Deals with British Airways and Mastercard followed.
“Bath and Bristol have been at the heart of Lux Rewards’ journey,” said Mr Courtney, who is now completing an Executive MBA at the University’s School of Management.
“The support from the local investor community, SETsquared, and the University of Bath was crucial in getting us here. This city is an incredible place to build a business, and I’m proud to say we’ve proven that a start-up from Bath can take on the world.”
Mr Courtney, Mr Munday and Mr Dey will remain within the business following the deal and are now focused on further growth. However, they said they are “not ruling out” future ventures together.