Sir Richard Branson, who's used the auspices of his Virgin brand to launch everything from a record company to an airline to a soft drink, insists that he's never been guided by mere business logic and analysis. "I've always done everything by intuition and gut feeling, and almost never used accountants to decide if I should start a new business," he says. He compared creating new ventures to creating art: "It's like a painting. You're trying to get every detail right on that painting. You want to create something you're proud of and that will make a real difference to people. If you get that painting right, then somebody may buy it, and if you create this excellent business, somebody may use it, and hopefully you'll be able to pay the bills at the end of the day."
Mr. Branson has often ventured into mature industries dominated by established players, with naysayers giving him long odds of success. In launching Virgin Atlantic, for example, he started with a single second-hand plane and was up against 12 American carriers. "Every single one of them disappeared because they didn't think of the customer," he says. "They just thought about trying to herd people on the plane like cattle." The airline turned out to be his smartest move, though everyone initially thought it was his dumbest.
For all his successes, Mr. Branson admits to his share of fumbles. He recalls, for example, bringing in a Sherman tank to Times Square in New York and blasting the Coca-Cola sign to announce the arrival of Virgin Cola. "We thought that pretty quickly Virgin would be the Number One brand and Coke would be non-existent. But they had bigger forces to bear." And he learned something from that failure: There's no point in introducing a new product or service unless it offers a fundamentally better experience.
Mr. Branson urges entrepreneurs to not be afraid of taking big leaps. "I love trying new things. I say, just give it a go. Sometimes, you need to make big, bold moves. We've tried lots of things and failed. People should not be embarrassed if they try and don't succeed.
"Occasionally, you fall flat on your face if you take that attitude"-but that's not a reason not to do it. And the payoff can be rewarding, not matter what the economic climate. "If you can get it right, you should be able to survive even the most tough times."
Editor's note: Mr. Branson was in Toronto in October to attend a small business summit. Members of the audience were invited to submit questions, many of which Mr. Branson answered at the time. A number of questions remained, however, that he didn't have an opportunity to respond to. Some of those questions, along with others submitted in the past week by readers, were sent to his public relations team in Toronto. Here are Mr. Branson's responses.
Question: In the introductory chapter of your book, you speak about an investment advisory committee which helps you review potential deals and business opportunities; how important is having trusted advisors to building a successful business?
Richard Branson writes: It's essential. You need trusted 'lieutenants' to bounce ideas off and deliver your vision. As your business becomes bigger you need your advisers to assess potential opportunities on your behalf as you will find your attention diverted to other areas. But keep your team small so you don't become too far removed from your customers and the core business decisions.
Jess Davis from Toronto writes: How do you know when you have a great idea that is going to work out to be a great business. Many people have great ideas that for better or worse would not ever be able to translate into a viable enterprise of any kind. How did you know, if you did at all that Virgin was going to be as successful as it is now or even to follow that path.
Richard Branson writes: That's a tough one. I don't always know that a great idea will be successful, but one thing I do know is that I'm not afraid to try. I remember when some of the major record companies turned down Mike Oldfield's debut album, Tubular Bells and as a result I had the idea that we would set up a record company and release his album under our own Virgin Record label. Island Records said they would distribute it for us but for a profit. I decided to do it all ourselves, be bold and take a bigger risk for a larger chunk of the upside. Thankfully, as many of you know, it paid off and the album was in the charts for something like 5 years and sold around 2 million copies.
Question: Did you have a mentor during the early days of your business ventures, who you would say played that role and what value/guidance did they provide that made a difference or had an impact on your outlook/actions?
Richard Branson writes: Sir Freddie Laker is someone that stands out in my early days of Virgin. I spoke with Freddie regularly when we launched Virgin Atlantic. His experience running Laker Airways was invaluable and two of his business sayings remain with me to this day: 'Only a fool never changes his mind.' 'Don't bring me your problems - bring me the solutions.'
Damien Lanforth from Toronto writes: I would like to know the differences you find from when you first were 'successful' back in the day to being successful in today's environment especially with what you see going on in the 'world'. Is it worth the effort? If you don't want to share that, then I'd ask who helped you build confidence to value the risks you were taking.
Richard Branson writes: Good question. Over the last 40 years the world has changed significantly but the fundamentals of business have stayed the same and success is still out there for the brave. Is it worth the effort? Absolutely. And although we are sailing right through one of the worst economic crises for decades this current climate still brings opportunities for many businesses to capitalise on - you just need to be brave and bold.
Question: As an individual who has achieved great success in business, what do you see as the critical characteristics or traits of a business owner?
Richard Branson writes: If you take a look at the inside cover of my book Business Stripped Bare you'll see I've written a whole host of traits that make for a good business owner and entrepreneur. Good imagination, willing to take risks, courage and persistence are just a few important characteristics I believe are vital to any entrepreneur's success.
Norris Liu from Toronto writes: I am a young, ambition-driven person with a lively entrepreneurial spirit. I am ready and eager to start on my own and 'conquer the world' as I see areas of opportunity in many aspects of business and social life. However, my predicament is that being the primary bread-winner of the family, I am financially 'confined' to keeping my job. It drives me crazy that I cannot pursue some potentially very substantial opportunities. What is your advice in this regard? Should I pursue funding from banks, lenders, or VCs? Look forward to your reply.
Richard Branson writes: Hi Norris. If you believe you have a great idea you need to build a solid business case behind it. Play Devil's Advocate and pull it apart, ask friends, family and colleagues to look at the idea from every angle and be honest. Convince them first and then you will have the confidence to approach backers, plus hopefully have the right answers to convince them to invest in your business. Good Luck.
Question: What do you value most in a business leader - either those you hire or those you choose to work with?
Richard Branson writes: Not to be afraid of making mistakes. To be a serious entrepreneur, you have to be prepared to step off the precipice. If you make a mistake, learn from it and do things better next time. Oh, and don't make the mistake again.
Question: What are the top three suggestions/recommendations you would give a small business owner looking to take their business to the next level for success?
Richard Branson writes: 1. Immerse yourself 100 per cent in everything. 2. Learn about the ins and outs of every single department. 3. As you grow, delegate.
That way when your team comes to you with your problems you'll know the answers and have valuable advice to offer. I remember Andrew Black, CEO at Virgin Mobile in Canada, doing just that when he started the company. Andrew worked on the phones at the call centre in the early days to learn first-hand the customer experience, today he still makes time to visit the call centre to keep in touch.
John Fontaine from Surrey, B.C. writes: I am a young person with a very creative idea for mobile phone advertising. How could I get 5 minutes of your time to pitch you the idea. Thank you.
Richard Branson writes: Best thing to do is send your idea to my team at Virgin Mobile in Canada. Email: pressoffice@virginmobile.ca and the team there will take a look and let me know what they think. And don't worry, even if they don't like the idea I might! Good Luck.
Arthur Fernandez from Montreal writes: I'm currently enrolled in the John Molson School of Business Executive MBA program here in Montreal. Prior to joining the program, I've had some misgivings about even getting an MBA because of my fear that it would churn me out as some kind of standardized product, thinking like everyone else. Despite this, I felt it necessary to go this route because I have no other experience in business. You once said one could learn more in three months just running a business than going to school for two years. I'm interested in what you'd have to say about biz schools in general and what you think of the people who go through it. It certainly seems to go against your more intuitive approach to creating a business 'artistically' with less regard for the quantitative aspects. Do you think most people go into business to serve themselves more than their customers? One more thing, I've heard it said that 'chance favours the prepared mind' You've told us that you keep a notebook with you always to jot down ideas...what is your frame of mind when you see an opportunity that excites you?
Richard Branson writes: I have a radical view of education. I think some university and business courses take too long and could be finished more quickly - I don't really understood why some courses have only a few lectures per week, and why students are left to their own devices much of the time without much direction from tutors. I really do believe that we still need a good deal more entrepreneurial thinking in our universities, colleges and business schools. But yes if they are run right they can be extremely valuable and beneficial.
On your other question I've gone into business because I believe customers in certain industries (like mobile phones, airlines, banking, etc..) were getting a raw deal and felt I could do something about it. Simple as that.
And yes I carry a notebook everywhere I go. I'd advise every owner of a company to keep a notebook and jot down the things that need doing. When I get an idea and write it down I instantly start thinking how to make it work and who I can get to make it happen.
Question: Given today's economy, what's the most important piece of advice you would give small business owners?
Richard Branson writes: Protect the downside. When making a business decision you need to ensure that if the decision fails it doesn't bring the whole house tumbling down.
Question: How have you and/or do you identify the 'good' opportunities from the 'not-so-good'?
Richard Branson writes: This goes back to The Investment Advisory Committee who examine all the proposals that come into me and Virgin. The team listens to the submissions, questions the proposals at length and then make a decision. Many major Virgin companies have been formed from this including Virgin Mobile.
Question:What was the one business opportunity you passed on that you wish you hadn't and/or the one you moved forward with that you wish you passed on? Why?
Richard Branson writes: Thinking I could knock Coca-Cola into number 2 position during the nineties is one that springs to mind. First year we were on a real role but then Coca-Cola sent two SWOT teams to the UK and shelf space got smaller and smaller. Problem was with coke there isn't anything fundamentally different unlike airlines. Key is to make sure you do something that is a big differentiator.
Noel Hulsman, globeandmail.com, writes: Thank you very much for your time today. We really appreciate it. Best.