- Richard Branson
- Business Stripped Bare
- Business_Stripped_Bare_split_015.html
6
Entrepreneurs and Leadership
Holding on and
Letting Go
In 2004 I did a
programme called The Rebel Billionaire for Fox Television, where I
was nice to people and then had to whittle them down to a winner.
It only got seven million viewers but it really helped our brand in
America.
In one episode, I told a participant
we were going to be the first to go over the Victoria Falls in a
barrel.
Annie Taylor was the first person to
conquer the Niagara Falls in Canada, riding the 170-foot drop in an
airtight wooden barrel in October 1901. Since then many other
daredevils have copied her achievement. But the Victoria Falls in
Africa – at 360 feet – is more than twice as high, and much more
dangerous, with jagged rocks at the bottom. I asked one of the
contestants, Sam Heshmati, if he was ready for the challenge of
going over the falls with me, in a barrel I said had been specially
created by NASA.
Were we going to do this
thing?
Bravely, Sam nodded. We got into the
barrel. A large crane lowered us into the fast-flowing river, a few
metres away from the drop. A two-minute countdown began. It seemed
an eternity, Five. Four. Three. Two . . .
A split second before we were due to
plummet, I shouted: 'Stop! Hold on just one moment, I want to show
you something.'
So we got out. And I showed young Sam
the bottom of the falls. I pointed at the rocks below.
'Sam,' I admonished him, 'you were
ten seconds from certain death. You shouldn't blindly accept a
leader's advice. You've got to question leaders on
occasions.'
Fast forward three years. I'm in Las
Vegas announcing the new route to San Francisco with Virgin
America. Someone has had this idea for a publicity stunt: they're
going to drop me on a wire, dressed in black tie, from the Fantasy
Tower at the top of Palms Casino, into the midst of the cocktail
party taking place on the ground below.
Now, I've abseiled many times before,
so this stunt is actually something I should feel relatively
comfortable with, even though I've never before been dropped off
the side of a building at 100mph. But it's an October day, and it's
windy. I'm looking at all the harnesses and wiring used in the
Spider-Man movies . . . and there's
something about all this that's making me feel uncomfortable. And
as I stand there on top of the tower, minutes before the leap, I
know what it is: I'm far too close to the
building. So I say to the technical team: 'I'm sorry, I need
to go to my room.'
Everyone thinks I'm chickening out.
But I just need to think. Four hundred
feet. A windy day. And I'm being dropped almost within touching
distance of the building . . .
There's a knock on my hotel-room
door. It's our Virgin America publicity people.
'Would you mind just coming up to the
roof to do the press anyway, Richard?'
I know I'm being suckered, but I
can't get the words out to refuse. My legs carry me upstairs and
there is the stunt team boss, assuring me that the wind has died
down a little. It doesn't feel like the wind has died down at all.
Indeed, it feels a damned sight windier to me. But these people are
professionals, right? And everybody is counting on me to do this
thing, right? And I don't want to disappoint people, right? And
suddenly I'm hurling myself off the top of the building. I hurtle
down, and on the way down I hit the casino. Twice.
I reach the bottom, utterly dazed and
very sore. Have I broken my back? I just hang there like a rag doll
while free airline tickets – part of our stunt – rain down
unnoticed on the appalled guests now crowded around
me.
Sam, you can consider yourself fully
paid back for that joke we had at your expense. My backside hurts.
My trousers are ripped to shreds. The press get some pictures of me
looking rather grey and dishevelled. I should have listened to my
own advice.
True leadership
must include the ability to distinguish between real and apparent
danger.
This is as true in business as it is
in ice climbing, ballooning, mountaineering or powerboat racing.
You need to understand the challenges to your enterprise and face
up to them. Equally, you have to resist the temptation to overreact
at the first sign of trouble.
Since I've been littering this book
with tales of our own successes, mistakes and lessons, I hope
you'll forgive me if – for once – I illustrate this last point by
giving you an account of someone else's mistake.
On 14 February 2007, the combined
company of NTL, Telewest and Virgin Mobile relaunched as Virgin
Media, creating the largest Virgin company in the world. For the
first time consumers could get everything they needed from one
company – we were the UK's only quad play of TV, broadband, phone
and mobile, offering the most advanced TV-on-demand service
available, V+, our high-spec personal video recorder and really
fast broadband Internet access.
Overnight, Virgin Media had become
the UK's most popular broadband provider, the largest mobile
virtual network operator and the second largest provider of pay TV
and home phone. We were taking on the Murdoch empire.
Rupert Murdoch has wielded more power
over a longer period of time than any other businessman on the
planet. The Australian, born in Melbourne, built a newspaper empire
in his homeland, expanded into Britain in 1968, and snapped up Dow
Jones in the USA in 2007. His satellite television empire straddles
the globe, and his newspapers are hugely influential. Rupert
Murdoch is someone to be feared and admired in equal
measure.
Rupert is now in his late seventies,
and while he still has immense energy, it is his two sons, Lachlan
and James, who are poised to take his place at the helm. In
November 2006 James, the chief executive of British Sky
Broadcasting, heard that Virgin Media were planning to acquire a
majority stake in ITV, Britain's first and largest commercial TV
station.
Deeply worried that the combination
of Virgin Media and ITV might give Sky a very serious run for its
money he tried to stop us. How? He bought 17.9 per cent of ITV's
shares – at a cost to Sky's shareholders of £940
million.
At the time, he was generally praised
by the press for pulling off this deal – but it turned out to be
perhaps the biggest mistake of his otherwise stellar
career.
The media world – and the politicians
– knew that his move was anti-competitive, and he had only done it
to stop us getting ITV. To that extent, he may have succeeded.
James Murdoch's intervention had, for the time being, frustrated
our plans to take over ITV.
The intervention led to a war of
words between us, legal action and a decision by Sky to withdraw
content, such as Lost and 24, from our Virgin Media service, at significant
cost to itself in terms of lost advertising income.
Soon after BSkyB bought the stake,
Virgin Media complained to the Office of Fair Trading, arguing that
competition in the UK TV market had been impacted. The Secretary of
State referred the acquisition of a 17.9 per cent stake to the
Competition Commission.
James Murdoch bought ITV's shares at
£1.35 each, overpaying in the market to secure them from two large
institutional investors, who promptly then went back into the
market and repurchased positions at about £1.10!
On 29 January 2008, the Competition
Commission ruled that Sky must cut its stake in ITV from 17.9 per
cent to below 7.5 per cent. BSkyB, having paid 135p a share, could
now be forced to sell below 50p. And ITV's share price continued to
fall. In July 2008, the ITV shares were worth only 40p
each.
So what's the cost to BSkyB of that
share purchase? At a share price of 40p it would be in excess of
$1.3 billion. James's mistake was to overreact to what Virgin was
doing. He could see that Virgin Media was going to be a threat to
the Murdoch media empire and that we would do well. Virgin Media's
aim was to give Sky a run for their money. But I don't think it
would have damaged Sky in any dramatic way – certainly not nearly
as much as he's lost trying to stop us.
Once you've been able to assess the
level of danger in any given situation, you must be able to
honestly gauge your own strengths and weaknesses as leader. You
need to be able to recognise what you can do as an individual – and
how you inspire and motivate other individuals to cooperate
willingly to get the job done.
How to achieve this? Well, for
starters, this is something that should – no, must – be written into every business plan:
This company will have lots and lots of
parties and social get-togethers. Parties are a way of
galvanising teams and allowing people to let their hair down. They
have to be inclusive and encouraging, and then they are an
excellent way of bringing everyone together and forging a great
business culture.
I used to invite everyone in the
Virgin business to a party at my home in Oxfordshire – but
unfortunately it became too big. At the last one we held – over
three days – we had nearly 60,000 people. We put on fairground
rides, sideshows, hamburgers and hot dogs, and rock bands – all
paid for by the Virgin Group. I stood at the entrance and made sure
I shook everyone's hand. My hand was swollen and rather painful
after two days of this, but it was worthwhile. Today we have
smaller gatherings, and I aim to get to as many of them as
possible.
The Virgin Blue party, meanwhile, has
become a glittering, red-carpet event – raising thousands for
charity in Australia. The event is organised, set up and served by
Virgin Blue people. It's headed by Jane Tewson, who established
Comic Relief in the UK and lots of other charity projects, and who
has been working in Australia with Aboriginal people. I donate a
week's holiday in Necker Island in the British Virgin Islands as a
major auction prize, and one trick I use is to get the runner-up,
who has bid perhaps A$80,000, and the winner, who's paid A$90,000,
both to pay A$85,000 and both go to Necker together. It's forged
some great friendships. We also raise A$100,000 by letting someone
name one of our aircraft, and all that costs is the paint job. It's
easy money for charity and fantastic for staff morale.
I think governments should make
parties completely tax-deductible, with the proviso that every time
there's a knees-up, shindig, disco or rave, the proceeds go to
charity. That's the deal. It should be much more than just a fun
night for everybody. A night when everybody gets merry is good, but
it's even better if you can combine it with something that makes a
difference to others. Music events, fashion shows, sports contests,
anything that gets people together and is enjoyable can be rolled
out across every business – just don't let anyone use the charity's
money to pay for the drinks!
A poor leader can make life hell for
so many people. Leadership is not about a person sitting at the top
of the tree, making all the decisions and expecting everyone to do
as they're told. That's hardly leadership: it's more like
dictatorship.
I have huge admiration for the
British version of the TV show The
Apprentice, in which people compete for a single job with
Alan Sugar. The camerawork is slick, the editing is clever, the
music is great. The power of television is immense, and if it's
capable of inspiring people to treat business with excitement and
enthusiasm, that can only be a positive thing. Frankly, anything
that can be done to inspire young people to give it a go has to be
worthwhile.
But I have one issue, and that's with
the way Alan has to say, with a frown, at the end of each episode:
'You're fired!' It's in his contract because it makes good
television. And it's cobblers. The whole competition is structured
around the fear of being fired. While this does make it interesting
for the viewer, it is not, in my opinion, how businesses should be
run.
Where The
Apprentice is successful is in its wider portrayal of the
modern business world. There are few jobs for life any more. As
individuals we need to be positive and sell ourselves. Most of
those taking part in the show will have a better grasp of this than
is apparent on camera. They know that failure is not something to
fear. They know there are other options, other places to
work.
So here it is important to stress
that there is a fundamental difference between
an entrepreneur and a manager. They are often contrasting
people and it's crucial to realise this. Although I'm sure there
are entrepreneurs who could make good managers, my advice would be:
don't try to do both.
Entrepreneurs have the dynamism to
get something started. They view the world differently from other
people. They create opportunity that others don't necessarily see
and have the guts to give it a go. Yet an entrepreneur is not
necessarily good at the nuts and bolts of running a business. I
admit that this is not my true forte – and recognising this
weakness is essential for the entrepreneur. The annals of business
are littered with stories of the driving force trying to run the
business on a day-to-day level – and failing
dreadfully.
Good managers are worth their weight
in gold. People with the acute psychological know-how to smoothly
organise and handle the pressures of an ongoing business venture
are the glue that binds the business world. My notebooks are full
of contacts and names of people who have been recommended or whom
we seek out to come and be Virgin business managers. Cherish them,
and give them a proper stake in the business, because they deserve
a big share of any success. Once the entrepreneur has the company
up and running, they often need to pass the baton on to the
manager. The creator's job is to find someone with expertise who
understands the vision and is prepared to follow the
path.
The entrepreneur's job is effectively
to put themselves out of a job each time the new company is up and
running. Then they can step aside and free themselves up to be
entrepreneurial in a different business. It is generally asking for
trouble for an entrepreneur to stick around for too long, trying to
cover both roles.
In a small business, you can be both
the entrepreneur and the manager while you are getting it going.
But you need to know and understand everything about that business.
And I really mean everything. An emerging
entrepreneur should sign every cheque. Examine every
invoice, and you'll soon appreciate where your money is going. Even
in a big business like the Virgin Group, I sit down now and again
and sign every single cheque that goes out, and I ask my managing
directors to do the same. For a month. Sign everything for a month
every six months and suddenly you're asking: 'What on earth is this
for?' You'll be able to cut out unnecessary expenditure quite
dramatically when you do that.
As a small-business person, you must
immerse yourself 100 per cent in everything and learn about the ins
and outs of every single department. As you get bigger, you will be
able to delegate, and when people come to you with their problems,
they'll be surprised how knowledgeable you are and how much
practical advice you can offer. The reason you're knowledgeable is
because in the early days of the business, you learned all about
it. This is how business leadership is achieved. There are no short
cuts. Remember my earlier description of Brett Godfrey at Virgin
Blue who insists that all of their senior managers spend time doing
the different manual jobs like luggage loading. (I needed a
physical after my stint!)
And as the business gets bigger, you
will have to decide if you're a manager or an entrepreneur. If
you're a manager you can stay with that business and help it grow.
If you're an entrepreneur, you need to find a manager. Then you
should move on, enjoy yourself and then set up your next
enterprise.
Nothing in business is quite like the
early, frenetic days of an ambitious start-up project. There's
always an amazing buzz about this kind of thing. It's high-octane
and high-risk and it builds a tremendous spirit and camaraderie
which takes everyone through some very trying times. I've seldom
seen people work harder than in the initial stages of a new
venture. Once a business matures and is established, it can become
more challenging to retain that excitement. What we do at Virgin is
not let businesses get too mature. If you can keep the businesses
relatively small, people will know each other within the
organisation and feel like part of a team.
It's then down to the leadership of
that organisation to keep making sure that people are challenged
and motivated. Jack Welch, a great business leader, who transformed
GE into one of the world's leading corporate powerhouses, was
constantly evolving tools and methods in search of continuing
growth. He encouraged managers to start each day as if it was the
first day in the job. He said that managers were often afraid of
change – and they must embrace it. I agree with Jack on
that.
We never let people sit on their
laurels, and we keep on trying to improve things. The minute Virgin
Atlantic was voted 'The airline with the best business-class seats
in the world' in the UK Airline awards, our designer was already
beginning to work on the next seats in order to beat our own
expectations rather than our competitors'. You must either stay
ahead of other people, or stay ahead of yourself, all the time. If
you really put your mind to it you are normally going to find a
better way. You have to keep on questioning the way people do
things.
Looking back over the personal
notebooks I have kept for more than thirty-five years, I don't
think there has ever been a letter from my office which criticises
the staff or an individual. Now and again I've disagreed with
something and suggested changes in behaviour. But the Virgin Group
has always tried to look for the best in people. That way, you get
the best back.
A plant needs to be watered to
flourish and people need encouragement so that they can flourish.
If this sounds precious, so what? It's true. When someone says
something nice about any of our Virgin ventures, I feel great. I'm
flattered. When someone has a go, it knocks me back. We've
developed a thicker skin over the years, but I hope we haven't lost
the sensitivity to do things properly. If witless criticism can
deflate me, after thirty-odd years of business success, then what a
fool I'd be to go around ticking off other people. People say
business is a cut-throat affair. Certainly it's a tough game – we
talk about 'the competition' for a reason. And, yes, sometimes
people play dirty. But nothing in my years with Virgin has eroded
my habit of saying thank you to people or praising them. I was
brought up in England by parents who praised and encouraged me a
lot. Why would I behave differently to others?
Right across our business we have a
philosophy of encouragement. Our people are very rarely criticised.
If someone makes a howling mistake, usually they don't need to be
told. They know.
One of my weaknesses is that I find
it very hard to tell someone that their services are no longer
required in the business. It's an unpleasant obligation, and one
you absolutely must not shirk. If you're a small company, it is
vital to do it personally. You really have to see the person face
to face rather than get someone else to do it. I think, generally,
a personal explanation of the situation is appreciated, and it
helps the individual you're letting go to move on.
Of course, if you actually
enjoyed firing people, there'd be
something wrong with you. Jack Welch made a point of continually
weeding out the people at the bottom. Alan Sugar and Donald Trump
aren't afraid to fire people either, though I doubt they go about
it quite the way The Apprentice would
have us believe. There's a machismo about the way some managers
talk about hiring and firing that I find downright repugnant. A
senior person at Apple rather proudly says in his speeches about
firing people that 'I'd rather have a hole than an asshole.' My
philosophy is very different. I think that you should only fire
somebody as an act of last resort.
If someone has broken a serious rule
and damaged the brand, part company. Otherwise, stop and think.
Indeed, these days you have to. There are a lot of legal and
employment issues to take into consideration before you even go
down that route. This can be frustrating, but to be honest I don't
think it's the nightmare that some managers make it out to be.
People respond to their surroundings. If someone is messing things
up royally, offer them a role that might be more suitable, or a job
in another area of the business. You'd be amazed how quickly people
change for the better, given the right circumstances, and how
willing they are to learn from costly mistakes when offered a
second chance. If you've over-promoted someone and it hasn't worked
out – which happens – then offer them their old job back rather
than firing them. It's your fault for over-promoting them. Not
theirs.
A lot of companies these days call
themselves 'families'. Usually, this is just an embarrassing bit of
public relations flannel. I think companies can be like families,
that it's a good approach to business, and that Virgin's created
better corporate families than most. We've done it by accepting the
fact that we have to think beyond the bottom line. Families forgive
each other. Families work around problems. Families require effort,
and patience. You have to be prepared to take the rough with the
smooth. You have to put up with your troublesome siblings. They're
your family: you can't just throw them out on the
street.
The higher up you go in a company,
the more perilous your job position is if you don't perform. In
football, dropping out of the Premiership – or failing to get into
the Champions League – can be disastrous. The board of directors,
or the club chairman, must hit upon a formula for success, and the
buck has to stop with the coach. Sacking the coach is easy. The
hard part is making sure you're getting someone better than the
person you're dropping. In football, that doesn't always seem to be
the case.
I often read about chief executives,
managing directors and large company bosses who are told to resign
from their high-profile companies by investors because they have
made a hash due to poor business decisions. In the United States,
for example, we've had Angelo Mozilo, the CEO of Countrywide
Financial, Citigroup's boss Chuck Prince and Merrill Lynch's Stan
O'Neal all departing with $100-million-plus compensation packages
despite their businesses being caught in the sub-prime mortgage
meltdown.
Too many top executives are given
massive payouts and allowed to walk away, leaving others to sort
things out. I think the opposite should happen. In most cases,
leaders should stay on until any problems are sorted out – or a
solution found – and then they can go and with a fraction of the
money they would earn if successful.
Decent
leadership is about explaining clearly and unemotionally why a
decision has been taken. This applies just as much to a
large company when there are lots of jobs at stake. For a business
to survive under extreme pressure it must take decisive action. And
when there are a lot of redundancies, that can hurt the pride and
self-esteem of a lot of hard-working individuals.
After the terrorist attacks on New
York City, Washington and United Flight 93 on September 11, 2001,
our 'Council of War' met each day to look at the unfolding
situation. I see from my notebooks that my first phone calls – of
many hundreds made within those vital hours – were to our bankers,
to let them know of the cash position; and to the UK government,
seeking their support and encouraging a common approach. We also
had to talk candidly to other airlines to get a proper picture of
events, so we needed temporary anti-trust immunity – we didn't want
to be accused of working in consort. I called the New York mayor,
to pass on my condolences.
Transatlantic air travel stopped and
I pleaded with Stephen Byers, the Transport Secretary, not to let
the position of Britain's airlines be weakened when the US
government was supporting its own national carriers. We didn't get
the same cushion of support as the American airlines – and we
couldn't and didn't hide in Chapter 11 administration. If Virgin
Atlantic hadn't responded decisively to the Twin Towers attack,
then we would certainly have gone out of business. We began
renegotiating our bank lending and our aeroplane contracts and we
did everything necessary to cut our costs. We had to reduce our US
capacity by a third, and so we began looking at other international
routes instead, such as launching into Nigeria, China and India.
Then we had to relay the bad news: reluctantly, we were letting
1,200 Virgin Atlantic people go. It was the first mass redundancy
in Virgin's history. We offered our people part-time work, job
sharing and unpaid leave. We also tried to find them work in other
parts of the business. Our managers made tough decisions that hurt
many people, but we promised to get them back on board as soon as
conditions improved – and, thankfully, most returned.
Dealing with Virgin Atlantic's flight
engineers was particularly difficult for us. A breed of aviators
with a passion for flying, they had considerable skill, and were
tremendously loyal and committed to our company. And here we were,
putting them out of a job.
If your rival airlines introduce
planes that require only two people in the cockpit – that's the
captain and first officer – rather than three, as was still the
case with Virgin Atlantic when we had the flight engineer on board,
then you're faced with a serious business issue.
The reliability of a new generation
of planes and the increasing sophistication of fly-by-wire systems
meant that airlines could reduce the number of flight crew in each
cockpit and, in the process, save a great deal of cash.
Unfortunately, the flight engineers were the victims of progress
and obsolescence in the airline industry. There was no longer any
need for them, and we had to tell many of our engineers that they
had to go. It happens sometimes. It's horrible. And there is no way
around it. If we hadn't done this, we wouldn't have been
competitive.
Over the years in the Virgin Group
our diversification has been a bonus. We've been able to move
people around our various companies, offering different jobs until
things improved again. But this wasn't easy with our flight
engineers. They had extremely specialised skills and we didn't
think that converting them to commercial pilots would work for us.
Our captains and first officers were normally highly experienced
pilots who had spent up to ten years on short-haul
flying.
Since we were saving cash by laying
these people off, they deserved the lion's share of the savings in
their redundancy pay. It was far more than the legal minimum and I
think most of them appreciated the gesture. It was a decent
package. The engineers thought it fair and – just as important – so
too did their colleagues who were staying on with the
company.
Many elements of leadership can be
prepared in advance, planned and rehearsed. You don't have to be
Winston Churchill to be a good leader.
That said, I think there is such a
thing as natural leadership. It takes a certain generosity of
spirit to trust people, and to judge their merits and limitations
fairly. It takes not a little bravery to bear bad news to people.
Optimism, openness to possibilities and sheer self-confidence –
some people have more of these qualities than others.
So, in addition to the practical
steps you can take, I think there is a huge amount to be gained in
following the examples of great natural leaders. You can certainly
read about them; but you should also be asking who among your
circle is a leader you can learn from. I am hugely privileged to
have met some great natural leaders in my time. Some are
internationally famous; many are not. To describe all the help,
influence and mentorship I've been sustained by over the years
would make another book, so for now, let me just tell you about one
important figure in my life: Nelson Mandela.
When people think of 'Richard
Branson', they tend to think first of all about Virgin's
involvement in the music industry. It's a piece of our heritage
we're extremely proud of. When I cast my mind back to what shaped
me most as a businessman, however, I find myself remembering an
even earlier phase of my career; and I recall my brief, fortunate
and illuminating adventures in journalism.
What, after all, could be better for
a young man searching for answers in life, than to go around
interviewing people? I was never going to be a great journalist,
but one skill I did have was being able to keep my mouth shut. I
let the people I was interviewing do the talking. I was also quite
unembarrassed when it came to asking what, in hindsight, seem naive
and obvious questions. Both are skills I've carried into business,
and they have served me incredibly well. The ability to listen, and
the willingness to stick your neck out and ask the obvious
question, are criminally underrated business
essentials.
I was brought up in the mid-1960s and
this was generally a caring and compassionate time, when a lot of
young people became socially aware and began to understand how the
world treated minorities, what their rights should be, and how a
fairer deal might change things. From the other side of the
Atlantic, I followed with fascination the struggles of black
Americans against racism, discrimination and economic
inequality.
In March 1968, I was proud to be
marching to the US embassy in Grosvenor Square in London in protest
at US involvement in the Vietnam War. I strode side by side with
left-wing firebrand Tariq Ali and actress Vanessa Redgrave, and I
remember the fear when the police on horseback charged us with
truncheons and tear gas. I was also invigorated by the thought that
young people were doing something direct and positive. And through
the prism of Student magazine, I – a
privileged English public schoolboy – heard for the first time
about the horror of Africa. I learned a little about oppression,
and disease, and famine. Student
campaigned against the horrific Biafran War in Nigeria, and we used
harrowing photographs by Don McCullin, the celebrated
photojournalist whose Sunday Times
images would go on to define the conflict in Vietnam and Cambodia.
We helped bring to the public's attention the plight of millions of
children dying of starvation who were caught up in the civil
war.
The autumn issue of Student in 1968 was awash with anger: the black
American ghettos were exploding with violence; rioting students
were throwing cobblestones at the police on the streets of Paris;
Russian tanks had crushed the Prague Spring in Czechoslovakia;
Vietnam was withering under a rain of bombs. There was so much to
cover. I remember we had Gyles Brandreth writing on America, and a
report from Vietnam by a fresh-faced seventeen-year-old Julian
Manyon – now a veteran ITN foreign correspondent – in which he
interviewed a North Vietnamese doctor about the death of Vietcong
soldiers through dysentery. But it was the interview I conducted
with the American black militant writer James Baldwin which shocked
me to the core. If you are harbouring any doubt in your mind about
the value of naive questions, read this. Look what he made of my
stumbling questionnaire. I would never have elicited such fire had
I been less direct.
What kind of
education did James Baldwin have?
'At school I was
trained in Bible techniques. I received my education in the
street.'
Were there good
schools in America?
'How can there
be? They are built by the white state, run by white powers and
designed to keep the nigger in his place.'
Can the white man
give you freedom or must the black man take it for
himself?
'The white man
can't even give it to himself. Your record has not been very
encouraging. I DON'T EXPECT YOU TO GIVE ME ANYTHING. I am going to
take what I need – not necessarily from you, this is your myth –
but I intend to live my life. I am not interested in what white
people do. White people are not that important. What one is
fighting against is not white people, but the power standing
between a person and his life. It is as simple as that. It is not a
race war, it is a war between poverty and privilege, freedom and
imprisonment.'
I was transfixed by what Baldwin was
saying to me – his vitriolic yet restrained anger at what he saw as
the inequality of life.
In The Fire Next
Time, written in 1963, he had predicted that in ten years'
time we would see the end of white supremacy. I asked him if he
still believed this.
Baldwin replied: 'I didn't say it in
quite that way. I said that this was a prophecy – and the prophet
may well be right. I am telling you that Western societies are
visibly in trouble and are visibly crumbling.'
'Under pressure from the black
man?'
'Under the weight of their own
lies.'
This was strong, urgent stuff for a
white, teenage editor. It was an anger that I could not understand,
because I had nothing to measure it against. I wanted to help
change the world, but what did I know about the world?
Fred Dube, a black African, born in
Johannesburg, a social worker married with two children, joined the
African National Congress in 1955. From 1964 to 1967 he served four
prison sentences for sabotage, in Ladysmith in Natal, Leeuwkop in
Transvaal, on Robben Island and in Groenpunt in the Orange Free
State. He left for England in July 1968, and became a bank clerk in
London. He told Student that the
poverty, homelessness and malnutrition in his homeland all stemmed
from one problem: South Africa's vicious and unjust apartheid
society. Some time later I heard about the black activist Steve
Biko, and then I encountered the name of Nelson Mandela. His
parents called him Nelson because it sounded 'white', and they
thought he would get on better in a whites-only society. He was
viewed as a dangerous extremist by some in Britain but I began to
know the truth about this incredible man.
When I first got to know Madiba – as
he is affectionately known in Africa – I was always in awe and
slightly nervous meeting him. Then when he smiled, his warmth and
impish humour simply radiated into your heart: 'Richard, it is a
great honour to meet you.' I soon learned that he says that to
everyone on first meeting them! Here is a man who has suffered so
much because of his colour and what he believes in. He was a victim
of apartheid injustice, handed a life sentence at forty-six. His
prison number was 466/64, which stood for the 466th prisoner
admitted to the dreadful Robben Island jail in 1964. His cell was
six feet square, the walls two feet thick. When he lay down his
head touched one end and his feet the other. His first months in
jail were spent with fellow political prisoners crushing rocks into
gravel using a four-pound hammer. It was achingly strenuous and
constantly painful. I have seen his cell – it must have been hell
on Earth.
He says in his autobiography,
Long Walk to Freedom, that 'Robben
Island was without question the hardest, most iron-fisted outpost
of the South African penal system. It was a hardship station not
only for the prisoners but for the prison staff. The warders, white
and overwhelmingly Afrikaans-speaking, demanded a master–servant
relationship. They ordered us to call them baas, which we refused
to do. The racial divide on Robben Island was absolute: there were
no black warders, and no white prisoners.'
Yet I have never witnessed one
scintilla of anger or indignation from the man.
His spirit is best captured, I think,
in the address he gave, not long after being elected president, at
the unveiling of a statue of Steve Biko. 'While Steve Biko
espoused, inspired and promoted black pride, he never made
blackness a fetish . . . accepting one's blackness is a critical
starting point: an important foundation for engaging in struggle.
Today, it must be a foundation for reconstruction and development,
for a common human effort to end war, poverty, ignorance and
disease.'
Here are the characteristics of great
leadership, contained in a handful of sentences. The concern for
people is here; so too the easy intelligence Mandela brings to the
judging of individual merits. There's authority in these words, but
they're not hectoring or bombastic: they create for us a clear,
simple vision of what has to be achieved.
The unveiling of Biko's statue,
sculpted in bronze by Naomi Jacobson, took place on 12 September
1997. Peter Gabriel and I were on hand – the only white faces in a
crowd of around 100,000. I urged Peter to sing the song that had
done so much to keep Biko's name alive. That rendition of 'Biko',
backed by Nelson Mandela and a crowd of 100,000, is something I
will treasure to my grave. From the moment Mandela came up to shake
my hand and thank me for my support, I wanted to do something
meaningful for South Africa, to help it recover from its terrible
wounds. I wasn't a songwriter – and I didn't have to wait long for
the call.
There is one characteristic of
Mandela's leadership that isn't apparent from his speech, but it is
typical of most of the great leaders I've met: they are all
inveterate salesmen! Mandela is an entrepreneur through and
through. He absolutely will not stop. Whenever we were together,
Madiba seldom missed an opportunity to pull a few strings for his
country. He was in London one time, having lunch with Joan, Holly,
Sam and me and a few close friends, and afterwards I wrote in my
notebook. 'No lunch or dinner ever goes by
without him asking a favour for someone in need: He came to my
house with his new wife, Graca Machel, and his daughter, "That was
a delightful lunch, Richard, Now last week I saw Bill Gates and he
gave £50 million in dollars." Gulp!'
I am proud to say that Nelson Mandela
has become a close friend. As we pass his ninetieth birthday, he
has remained an inspiration to me as a human being and I have many
cherished memories of time spent in his company. I think it's worth
explaining how the former South African president's astonishing
acumen for business, coupled with his sense of duty, helped his
country. For Madiba knew that the 'long walk to freedom' for his
black brothers and sisters meant embracing a positive economic
future. While he recognised it would take many years – even a
generation – to reverse the inequalities of racial discrimination,
he had few qualms about seeking my involvement – and that of other
business leaders – if he believed it would bring jobs and wealth to
South Africa.
One occasion was in September 2001,
just days after the World Trade Center atrocities in New York.
Tourism and business travel had dried up overnight, the whole
airline industry was in meltdown, and I was sitting in the bath
thinking how the Virgin Group could deal with the immense
disruption to Virgin Atlantic when he phoned. Madiba's voice was
like an anaesthetic balm: calm and reassuring.
'Richard, you said that you wanted to
help South Africa,' he said.
'Yes, Madiba. You know I'm willing to
help,' I replied.
'Well, we have a problem . .
.'
One of South Africa's biggest health
clubs, the Health and Racquet chain, had collapsed. It meant the
loss of 5,000 jobs. 'Do you think you could do something with it?
Do you think you can save the people?'
I didn't really know if this was a
viable business, but I went with my gut instinct, and my desire to
support a man I revered. Also, I trusted Madiba: in another life he
would have made an astute corporate financier!
I rang Frank Reed, the Virgin Active
chief executive, and Matthew Bucknall, his finance director, who
ran just three large clubs in the UK. Would they be prepared to
take on an ailing South African business nearly eight times their
size? There was a palpable gulp from Matthew – but he then said
they'd jump at the chance. Brilliant! Within hours we were able to
put a rescue package together – rebranding the whole business
Virgin Active. I called Madiba back to say we were definitely on
board.
But money was tight for us and we
needed to raise funding, so we approached the UK private equity
company Bridgepoint Capital who agreed to take a 55 per cent stake
in a deal worth £110 million, leaving Virgin with 36 per cent, and
Frank, Matthew and the team around 8 per cent. When Gordon McCallum
heard about the speed of the transaction he said: 'At this pace, we
should rename the company Virgin Hyperactive.'
Our strategy involved keeping on as
many people as we could, and retaining Health and Racquet's 900,000
customers, although we had to change the arrangements for many
health-club users. They had been given free lifetime membership, in
return for signing up with a big upfront fee – fine until the new
memberships dried up! We judged, correctly as it turned out, that
nearly all of the members would agree to start paying a monthly
subscription provided we gave them a first-class health-club
experience and fixed the dilapidated gyms that had been starved of
investment.
The rescue gave us a fantastic
footprint in South Africa from which we have continued to expand.
By October 2005, Virgin Active was in a better financial position –
having doubled in size and expanded into Italy and Spain – and we
were able to buy back Bridgepoint Capital's 55 per cent share for
£134.5 million.
*
When Nelson Mandela was president of
South Africa he knew his diplomatic position. South Africa's
re-emergence as a nation was reliant on China's increasing strength
and its investment as an economic superpower. He didn't want to
offend China. And he never ever did.
Once free from the burden of
presidency, of course, Madiba was his own man again.
In November 2004, I was in
Johannesburg at the CIDA City Campus, the first free campus for
black students from townships and rural areas who cannot afford
education. I was with Kelly Holmes, the double gold-medal Olympic
runner, the singer Estelle, and the team from Virgin Unite for the
launch of an initiative called Women on the Move, which focuses on
empowering young women across South Africa. After the ceremony I
stayed on to listen to the Dalai Lama, the exiled Tibetan leader,
who had been invited to speak at CIDA. It was his third time in
South Africa and he spoke with verve, compassion and gentle humour.
He smiled as he welcomed people from all religions, the
non-religious, and black, white and brown alike. I was enthralled
listening to this deeply spiritual man appealing for peace and
justice.
He said: 'If you wish to experience
peace – provide peace for another. If you wish to know that you are
safe, cause others to know that they are safe. If you wish to
understand seemingly incomprehensible things, help another better
understand. If you wish to heal your sadness or anger, seek to heal
the sadness or anger of another. Those others are watching for you
now. They are looking to you for guidance, for help, for courage,
for strength, for understanding and for assurance at this hour.
Most of all, they are looking for your love.'
There was nothing the Dalai Lama said
that day that could possibly have incited the Chinese authorities.
He simply asserted that the gap between rich and poor was morally
wrong.
I had been with Madiba at his home
the previous afternoon, and I asked him why he had never met the
Dalai Lama. He frowned and told me it had been too political. The
South Africans didn't want to upset China over their activities in
Tibet. But I thought it would be good to get these two wonderful
elders together – and that political expediency should not bar them
from meeting.
'You're no longer president, Madiba,'
I said. 'He can visit you as a private individual. He's staying
only a few blocks away from here.'
Mandela smiled and looked across at
Zelda le Grange, his assistant and adviser. I could tell that he
was persuaded. Later the next day, Zelda invited me to join them
for the get-together I had suggested – but I found myself declining
this extraordinary invitation. I felt it should be a special
occasion between two inspirational people, and that no one else
should be present. That night, after the meeting, we got the
following message from Wendee, who works for the Dalai Lama: 'On
behalf of the entire delegation, thank you for setting up what may
be the first and last meeting of these two giant spirits . . . The
meeting lasted an hour in deep discussion.'
There are many things in my life that
have given me satisfaction. But the union of two iconic figures in
Johannesburg will be a moment I will cherish for as long as I live.
And that meeting began to strengthen the idea Peter Gabriel and I
had had: to bring together a group of wise global elders . .
.
Necker Island, January 2004
Dear Madiba,
An idea – yes, I'm sorry – another idea. Out of the most
wonderful day – the 46664 concert [in November 2003 – a declaration
of war on Aids in South Africa] – Peter Gabriel and I were inspired
to write to you.
As well you know, in an African village there are elders
who the rest of the village look up to. We believe that the Global
Village needs to equally tap into our elders. You told us then that
it had been easier for you to gain the trust of the generals
negotiating in Rwanda, as they said talking to you was like talking
to a father. We would like to set up a small body of the most
respected 'Elders' in the world and as you are accepted as the most
respected person of all today, we would ask that you become the
father figure to this organisation and the first
Elder.
Einstein once said: 'How I wish that
somewhere existed an island for those who are wise and of
goodwill.' I said it would be wonderful if the Elders could meet
somewhere like my own Necker Island two or three times a year to
discuss how they could help tackle the pressing issues of the
world.
We would suggest that the Elders are initially chosen by
yourself, and then in the future chosen by the world community,
giving them added legitimacy on the world stage. None of them would
be current politicians. The Council of Elders would comprise 12 men
and women. Four of these could stand down every three years. The
new four could be voted in from a shortlist selected by the Elders
through channels like the Internet, television, post and email.
They would represent a broad spectrum of the world's
people.
Peter and I said that the first
worldwide vote would encourage people to think globally, to feel
part of events and engage with a world beyond their borders,
culture and religion. As the United Nations represents the
governments of the world, the Elders would represent the hopes,
aspirations, fears and dreams of the people.
The Elders would have at their disposal a 'Growing Tree' –
an army of people worldwide who have retired, or who have the time,
who are willing to give their time and expertise to help tackle the
problems of the world. Whether setting up an Open University for
Africa or India, tackling conflicts, diseases or poverty. They
would also help mentoring programmes. They would be a huge
educational resource.
The aim from the start was for the
Elders to be a group of global advisers and not to instruct people
to do things. They were to be individuals, and not simply
representatives of a country or state. They were to be beyond party
politics and free to speak what they saw as the truth.
I appreciate that you would have difficulty finding much
time yourself but it would give enormous credibility to the future
of the Elders if you were to give it your blessing and be its
founding father.
I would pledge myself to find the time and resources to
help organise it behind the scenes and to make sure it becomes a
force for good in the world and hopefully continues for many years
to come.
Kind regards,
Richard
Nelson Mandela loved the idea. It
appealed to his entrepreneurial instincts. He agreed to become its
founding Elder, along with his wife Graca, and they issued
invitations to the eleven people in the world he felt had the
greatest moral authority.
I'll never forget walking out of
Madiba's home with Jean Oelwang after he and Graca had made the
final selection of Elders. I had a wonderful feeling that this was
the start of one of the most hopeful and inspiring ventures in my
life. I also felt so blessed to be able to spend time with two true
global leaders. Graca and Madiba share the extraordinary ability to
lead with humility, honesty and an unfailing focus on those whose
voices are not yet being heard. Madiba frequently reminds us that
if something is not going to make a difference at village level,
then we shouldn't be doing it.
With Virgin Unite's support, we then
went on a journey of creation, reaching out to people all over the
world to shape initiative and build support. We had two glorious
weeks during which Archbishop Tutu and ex-President Carter helped
Peter and me to host a range of different groups on Necker – from
scientists, to philosophers, to entrepreneurs, to front-line
leaders. As with the development of any business idea, there were
moments when we thought: what are we doing?, and then that
magnificent moment when it all clicked into place and we knew that
this was going to be something that really could make a huge
difference in the world. We also wove in some fun – impossible not
to do with the cheeky archbishop there to keep us all on our toes.
One of my fondest memories from this time is of Peter and me
teaching him to swim in the beautiful waters surrounding
Necker.
I will never forget the speech Madiba
gave to everyone when we first brought the initial group of Elders
together at Ulusaba:
Let us call them Global Elders, not because of their age,
but because of their individual and collective wisdom. This group
derives its strength not from political, economic or military
power, but from the independence and integrity of those who are
here. They do not have careers to build, elections to win,
constituencies to please. They can talk to anyone they please, and
are free to follow paths they deem right, even if hugely unpopular.
I know that as a group, you will support courage where there is
fear, foster agreement where there is conflict and inspire hope
where there is despair.
After this gathering the Elders
decided they wanted to announce their existence to the world on
Madiba's upcoming birthday on 18 July 2007. The team at Virgin
Unite went into overdrive preparing for the launch and working with
me to raise the funds we needed for the first few years – all in a
little over five weeks! During this time, we had the opportunity to
connect with an amazingly humble and sincere group of entrepreneurs
and organisations who helped found the Elders. Their spirit in
coming together behind this dream and the absence of any individual
agendas truly captured the essence of the Elders. They have not
only become partners in this initiative, but I'm also sure they
will become lifelong friends.
As I write this, the other Elders are
Madiba's wife, Graca Machel, a renowned advocate for women's and
children's rights; the Anglican archbishop Desmond Tutu, who was a
tireless campaigner against apartheid in South Africa; Kofi Annan,
Secretary General of the United Nations from 1997 until 2006; Ela
Bhatt, founder of India's Self-Employed Women's Association;
Lakhdar Brahimi, the Algerian-born former ambassador who began life
in his country's liberation struggle and then became a mediator in
many Middle Eastern conflicts; Gro Harlem Brundtland, the former
prime minister of Norway, who has made a significant impact on
global society through her commission on the environment and
sustainable development; the sociologist Fernando Cardoso, the
former president of Brazil, who has fought hard for human rights in
South America; Jimmy Carter, who brokered the historic Camp David
peace accords when he was president of the US; Mary Robinson,
former president of Ireland and a distinguished United Nations High
Commissioner for Human Rights from 1997 until 2002; Muhammad Yunus,
the Bangladeshi economist and Nobel Peace Prize winner, and founder
of the wonderful Grameen Bank; and Aung San Suu Kyi, a fearless and
outspoken critic of the military junta which dominates her Burmese
homeland.
The Elders are, in essence, a group
of immensely influential world figures acting like entrepreneurs
who use their moral courage, wisdom and independent leadership to
help tackle huge intractible problems. The beauty of the Elders is
that they are at a time in their careers where they have no other
agenda but that of humanity.
Once, whole empires were operated out
of small rooms by a handful of oligarchs. Those days are
effectively over, thank goodness, and certainly it's not anyone's
plan to give the Elders political power! But what we do hope and
intend is that the Elders can bring their influence to bear on the
world stage, quickly and responsively, providing the peoples of
this planet with a voice and a conscience.
So over these few pages, as I explain
to you how the Elders work, I hope to convince you that
entrepreneurism is not something you ever grow
out of; nor is it something uniquely fitted just to sole traders,
or small companies, or even to modular enterprises like the Virgin
Group. Entrepreneurism is – if this doesn't sound too pompous – a
universal business virtue. I mean that it can be applied to
problems, challenges and opportunities regardless of scale.
The Elders have been assembled in
much the same way that a Virgin company is created. We have
facilitated their organisation, and have provided them with the
means to work together. We've made sure there is a motivated
administrative team. And we are ensuring that the Elders' name and
brand is protected. It is important that the group develops a
recognised single identity, to sustain it through frequent changes
of membership and a constantly evolving roster of
activities.
Peter Gabriel and I felt it was
essential that we stepped back from this – that the Elders had
complete independence and that their articles of association
enshrined that complete independence. The Elders are beholden to
nobody – and that includes the founders and any of the people
funding them.
The twelve Elders are people with
tremendous personal integrity. They are generally all over sixty
years of age, and beyond ego. Their mission statement says that the
Elders' role is to work to resolve global issues and alleviate
human suffering. It has taken a huge amount of work to get the
mission statement and the structure properly sorted.
As mentioned, we've brought together
a wonderful group of entrepreneurial founders whose generous
contributions ensure that the first three years' operating costs of
the Elders are paid for, so that they can go on missions to places
like Darfur and Kenya. The Elders are not paid for their work. They
are able to tap into some of the leading conflict and
dispute-resolution professionals from around the globe. The
international stature of the Elders means that if they call on
someone for specialised help in a project, then they will get an
immediate response. Professional mediators will be able to do the
groundwork before the Elders go into any area.
I hope that in 100 years' time – if
it is run correctly – the Elders' group will still be in existence,
and that people who have excelled in their lives, be they
politicians, diplomats, humanitarians or business figures, can be
part of it. When these good and worthy people get into the last
fifteen years of their active lives, then the Elders can ask them
to join in tackling global problems.
Does this extraordinary-sounding
organisation motivate you to create and facilitate something
similar in your own industry? I do hope so. After all, the idea for
the Elders came in the first place from my nigh on forty years of
business experience and Peter's experience starting up global
organisations such as Witness. Every industry has its revered
figures, people that companies and entrepreneurs go to for advice
and sound judgement. Many of the great and good in business are
living longer these days, they're living healthier lives, and more
often than not their appetite for business is unquenched. Imagine
how much mentorship, sound advice and even practical assistance is
out there, waiting to be tapped. Imagine if your industry were
supported by a network of revered business figures like Sir Brian
Pitman.
I concede this isn't so much business
advice as a call to arms – but if these pages have inspired you to
consider the good of your industry as a whole, and how your
organisation can contribute to the effective and responsible
conduct of that industry, so much the better. The great and good in
your business sector are a resource you should take seriously.
Finding a way to harness that resource to best support and
encourage your industry will add value to your brand – and what you
learn will have a direct and positive effect on your
business.
*
To be a serious entrepreneur, you have
to be prepared to step off the precipice. Yes, it's dangerous.
There can be times, having jumped, when you find yourself in free
fall without a parachute. There is a real prospect that some
business ventures will go smashing into the ground. It has
certainly been very close at times throughout my own business life.
Then you reach out and grab a ledge with your fingertips – and you
claw your way back to safety.
Life has become too cosy for many,
who have their lives mapped out by parents and teachers. It's all a
bit, well, comfortable: off you go to
university to study a course. Land a good job, get a mortgage, find
a nice girlfriend, boyfriend, partner. It's a solid life – a good
life in many ways – but when was the last time you took a
risk?
Many people reading this book will be
affluent. If you don't feel affluent right now, take a minute and
think: the very fact that you could afford this book, or afford the
time to take it out of the library – the very fact that you are
able to read at all – marks you out as one of world history's
richest and most privileged people. There's not that many of us,
and we haven't been affluent for very long, and so we're not very
good at it yet. Affluence makes us lazy. It makes us complacent. It
smothers us in cotton wool. If your job's well paid, who can blame
you if you're not willing to take a risk and, say, set up your own
company?
The vast majority are very happy with
this arrangement, and good for them. But if you want swashbuckling
action in your life, become an entrepreneur and give it a go. Learn
the art of trying to set up your own business. Which is the same as
saying, learn the art of making mistakes and learning
lessons.
Because if you want to be an
entrepreneur and you don't make a few
errors along the way, you certainly aren't going to learn anything
or achieve very much.
People have a fear of failure, and
while this is perfectly reasonable, it's also very odd. Because it
seems to me that it's through making mistakes that we learn how to
do things. Watch a musician practise sometime. Watch a baby figure
out how to walk. Listen to a toddler speak. Skills like walking and
talking and playing music emerge gradually, steadily, from a
blizzard of (often pretty funny) mistakes. I think this is true of
everything – that learning is about
making mistakes and learning from them. And that is the fundamental
reason that flying has become so safe in the twenty-first century;
so safe in fact that sitting on a 747 to New York is safer than
watching TV at home.
Now, I grant you that you may hit a
limit, beyond which you can't learn
from your mistakes. Don't expect a chart-topping album from me any
time soon, or a recital at Carnegie Hall, or a sequence of sonnets,
or any of the billion and one other things I'm never going to be
great at. But that's not failure.
That's finding out what you're good at. The world is much, much
bigger than you, and no amount of worldly success is going to
change that fact.
Failure
is not giving things a go in the first place. People who fail are
those who don't have a go and don't make an effort. Failures can't
be bothered. There are few people who've tried something and fallen
who didn't get enormous satisfaction from trying, and I've learned
more from people who have tried and faltered than from the few
charmed people for whom success came easy.
In my home country, the British
education system has a lot to do with our fear of failure. I think
it concentrates exclusively on academic achievement and downplays
the other contributions people can make to society. I've huge
admiration for scientists and engineers; whereas they are given due
respect in Germany, the United States and Japan, in British society
they tend to get a raw deal.
As someone who never went to
university, perhaps I've a radical view of education. I am
committed to excellence and expertise in business but I believe we
need to show young people the value of wealth creation too. I think
some university degrees could be finished more quickly – I've never
understood why some courses have only two or three lectures per
week, and why students are left to their own devices much of the
time without much direction from tutors, lecturers and professors,
who now spend most of their energy, it seems to me, chasing funding
grants. But one thing is apparent to me: we still need a good deal
more entrepreneurial thinking in our universities and
colleges.
One of my greatest entrepreneurial
heroes was Sir Freddie Laker. Freddie, who died in February 2006,
aged eighty-three, lived his life to the limits. He was a
tremendous person: a man of magic and mirth. He lit up a room and
he was the ultimate salesman. An ex-colleague and close friend,
David Tait, said he could sell a glass of water to a drowning man.
Freddie was a huge inspiration and supporter of Virgin Atlantic and
he was the godfather of cheap international air
travel.
The first Skytrain flights took off
from Gatwick to New York in September 1977. Although Freddie's
airline was no-frills, the ticket prices were unbelievable. It was
only £59 single to get to America – a third of the price of any of
the other carriers. He made £1 million profit in the first year –
and I was one of his regular customers as we expanded our Virgin
Records business in America.
Skytrain were carrying one in seven
transatlantic passengers – and Freddie was knighted in 1978. Then
in 1982, the company went into receivership with debts of £264
million. He had borrowed heavily to buy fifteen new planes just as
the pound plunged in value against the dollar, but worse than that,
the major airlines had conspired against him, offering cheaper
fares to undercut him. The airlines also threatened the airframe
manufacturers, telling them not to sell to Freddie. His airline
collapsed – with passengers still in the air.
In 1983, the liquidators Touche Ross
started an anti-trust action in the United States, claiming $1
billion from ten major airlines – including British Airways, PanAm,
TWA, and Lufthansa – who had got together to plot Freddie's
downfall. The defendants settled out of court, negotiating a
reported £35 million payment to Freddie's creditors – while he
reluctantly accepted £6 million in compensation and retired to the
Bahamas.
Three days before the collapse, in
typical style, he said: 'I'm flying high – I couldn't be more
confident about the future.' And David Tait recalls sitting next to
Freddie as they flew out of Gatwick airport on an Air Florida
flight ten days after the collapse. Below, jammed in wing tip to
wing tip in the Laker hangar, sat Freddie's life's work, a forlorn
cluster of grounded DC-10s still emblazoned with the Skytrain logo.
But Freddie turned to his distraught partner and said: 'Don't
worry, mate, it'll all work out just fine.'
His company was bust. Yet four-times
married Freddie still knew that there was much more to life. He
enjoyed reminiscing with me over a Pusser's rum and orange on his
yacht in the Bahamas, and he relished a pint and a laugh with his
friends.
It was on another Air Florida flight
that he met an off-duty Eastern Airlines stewardess called
Jacqueline Harvey. It was love at first sight – or first flight –
and Jacquie made Freddie's last twenty years a lot more fun,
erasing any memories of his airline's failure.
It was his business sayings that were
so memorable for me.
'Only a fool never changes his
mind.'
'Don't bring me your problems – bring
me the solutions.'
And his most famous one: 'Sue the
bastards.' Litigation lawyers the world over still celebrate that
one! But it was about the best advice I got when I had to take on
British Airways after their dirty tricks campaign against Virgin
Atlantic in the late 1980s.
Freddie was never afraid of failure.
He succeeded in life – and always gave it a go. That's why we named
one of our planes the Spirit of Sir
Freddie.