Richard Branson - Business Stripped Bare

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.