Sir Richard Branson loves what he does and can’t resist a new challenge. His attitude is to jump right in with an idea and take risks.
With the Virgin Group diversified into more than 300 different areas of business, that attitude has served him well. But Branson said he never wanted to be an entrepreneur.
“That act of being an entrepreneur, the projects that I’ve launched, is so I can pay the bills at the end of the year and keep people in employment to actually do the things I enjoy doing,” Branson said. “I just enjoy doing a lot, and one thing has led on to another.”
When he started Virgin more than 25 years ago, Branson didn’t know it would grow to be a multibillion-dollar global brand. He started out with an idea, taking the leap and finding good people to work with to create his brand, built one idea at a time.
Q: Can you talk about continual diversification in evolution and the changes Virgin Records has gone through?
In the early days, we got heavily criticized. … There were lots of journalists who talked about stretching the brand too far when the Branson’s balloon burst, which actually burst on a number of different occasions. The sort of conventional wisdom in business schools was (to) specialize in one area, but it’s just not in my nature. And as it turned out, it was very fortunate because the record business, our first business, is struggling. It’s very lucky that we went into mobile phones and other businesses, (that’s why we) are doing extremely well today.
Q: Not all your businesses are in industries in which the industry is doing well, how do you find a way to exceed peers?
When we started in the airline business 25 years ago, we had one airline, one plane, and we were competing with 15 very big airlines. And of those 15, 14 have gone bankrupt, all of the American carriers, TWA, Pan Am, People’s Express, you name it. I think the reason we survived (was that) we were a much smaller airline, but we made sure that we were the best airline out there.
We always had a lot of fun. British Airways was much bigger than us, and every time that we could pull their tails we would do so. … Virgin also believes in glamour. Why shouldn’t flying be glamorous and fun again? We just ran an advertisement about three months ago to celebrate our 25th anniversary.
If you are taking on a much bigger operation like British Airways, (and) most people who start a business from scratch are taking on much bigger corporations, you have the advantage that you are smaller, you are more nimble, you can move quicker, you can make sure that if you are going to change your business class seats you can change it far faster than they can. If you’ve got to put standup bars on your planes, you can do it much quicker than they can. As long as you use your tactful advantages well, you can survive.
We wanted to be the first airline with flatbeds in them (and) they actually found out what we were up to. A few months before our beds went on, they came out with a slightly better bed. It cost us $100 million. We chucked out all of those beds within 12 months and came in with something that we knew would stick. But for them to change again, it would have cost them $1 billion, (so) they didn’t.
If you make a mistake, you’ve got to acknowledge it quickly. But you’ve got to run each of your companies as if you own them personally, as if it were a private restaurant. If I’m on a plane and any of our chief executives are on planes, I’ll make sure that I get out and meet the 400 passengers on the plane, make sure that I spend time with all the staff, make sure I have a notebook in my pocket and write all the points down.
Listening is absolutely critical. And I think as the managing director or chairman of a company or the manager of a division of a company, with BlackBerry’s and phones, you don’t need to get stuck behind a desk. You can just get out and experience your businesses, experience your competitors experiences, and all the time just be working hard to improve on them, all the time motivating your staff. …
If I’m in a town, I’ll try to make sure I take all the staff out on the town in the evenings. Because we’ll be drinking a little, I’ll make sure that the notebook is in my pocket, so that when I scribble at the bar something that they have to tell me I can get ahead and do it the next day. I think it’s important to let your hair down with the team.
Q: How do you stay fresh? How do you drive your people to keep that spirit and sort of mirror your spirit?
I think it does come from the top down. If you put the wrong person in any of your companies, you can destroy a company very quickly. That person has got to do lots of things right. Bringing (a) so-called expert from outside into a company, above people who feel that they are good enough for the job, can be very demoralizing. So we try to promote from within.
We try to make sure that a switchboard operator is not always a switchboard operator, if they are good enough to move on up. A cleaning lady is not always a cleaning lady. The cleaning lady at our recording studio division ended up running the recording studio division. … You’ve got to just find people who are really good at dealing with people, motivating people, caring for people, looking for the best in people. (Use) lots and lots of praise, criticism should not be part of their makeup, and inspire people to really.
Q: Are there some (risks) that didn’t pan out well for you that you could talk about?
There’s plenty that haven’t panned out. Fortunately, because we don’t buy companies — we build companies from scratch — if something is not working out, it generally doesn’t cost us too much.
We like to take on the biggest, and I suspect the one that we were hoping (for is) to knock Coca-Cola into the No. 2 position. I believe Coca-Cola is still the No. 1 cola company in the world. We have lots of fun trying. We’ve landed in New York with a tank from England, and went to Times Square and blasted through the Coca-Cola sign … Their guns are bigger than our guns. They drove us off the shores.
Q: Do you get personally invested, emotionally, in risks that don’t pan out?
Of course, because you are dealing with people, and pulling the plug on the company is pulling the plug on people. I definitely don’t follow the rule that I should follow, which is cut the losses quickly. I can let things go on too long.
Even if you try something and fail, I think it’s good for the brand. Virgin is sort of the underdog brand, so if we try something and we fall flat on our face, somehow I think it doesn’t do too much harm. So we’re willing to take bigger risks, or slightly bigger risks, than some.
Q: Can you talk about Virgin Galactic?
I saw the moon landing as a young teenager (and) thought that one day I’d be able to go to the moon. I soon realized that because (it was) a government-run space travel (program), that they weren’t interested in you or me going to space. So, in 1990, I registered the name Virgin Galactic — I always like the sound of the name — and headed around the world to see if I can find any engineers or technicians that could build a spaceship that could offer people a return ticket.
Q: What do you have to say about your dreams?
I’m just very fortunate that I’m in a position where I can try to fulfill my dreams. The sky is usually not the limit. It’s just getting out there, finding the genius that Tom was. He came up with this idea, that the biggest danger with space travel is the re-entry. If you can turn the spaceship into a giant shuttlecock, you can then literally come in as a shuttlecock and the pilot would be sound asleep. You haven’t got all the risks that NASA had in the past. And then turn it back into a spaceship and come back down again.
It’s just great to be able to find people like that, who have the genius ideas, and invest in them and enjoy the excitement.
Q: What are lessons that come to mind from your career?
The names of the books sum up my philosophy in life: ‘Screw it, Let’s Do it.’ I’m the sort of person that says, ‘Let’s just give it a try.’
If I’m flying on a domestic American airline, which I have done over the last 30 years, and I find that the service is dire, which it has been for the last 30 years, then don’t just talk about it, go out and start an airline that gives people a choice.
I think that applies to a lot of businesses. If you are frustrated with the way people are doing things, go and try to do it better than they are doing it. Get fantastic people around you and make sure that they completely believe in what you are doing. Give them a lot of freedom to make mistakes, as well as to make good things, and let them get on with it. Don’t try to second-guess what they are doing. That will free you up to move on to the next thing.
Q: You also have a deep commitment in giving back to the community in which you live and work. What is Virgin Unite, its focus and mission?
I think that if you are an entrepreneur and you are capable of building businesses to make money, and to make a difference in different sectors, you should also be capable of using your entrepreneurial skills to look at some the problems of this world and set up not-for-profit organizations to tackle some of these problems.
Through Virgin Unite, which we set up to unite all that ... we’ve (set) our entrepreneurial team to look at things like conflict resolution issues or disease — Africa doesn’t have a center for disease control — so maybe that’s what lacking there is to set one up. …
Of all those things, I suspect that the one we’re most proud of is an organization called ‘The Elders,’ which is headed up (by) Nelson Mandela and Archbishop Tutu and President Carter, here in America. And they’ve got the 12 perhaps most respected men and women in the world, high moral authority, and they go into conflict regions and try to resolve conflicts, and (they) have had some considerable success over the last two years.
Q: When you started Virgin more than 25 years ago, did you know that it would be such a huge global brand?
No. I left school quite young. I left school when I was 15 to start a magazine for you people. A lot of wars were taking place, and like a lot of young people (and) I disagreed with the war. Students wanted to have a magazine to campaign against the war, and I just wanted to be an editor.
I’ve never been interested in being an entrepreneur. That act of being an entrepreneur, the projects that I’ve launched, is so I can pay the bills at the end of the year and keep people in employment to actually do the things I enjoy doing. I just enjoy doing a lot, and one thing has led on to another. I never expected to be in this wonderful position that I find myself in, and I don’t want to waste that position.
Q: How do you continue to maintain this passion, continue to have so much fun after so many years, after you gained recognition, wealth, etc. ?
I think I’d be very sad if I didn’t continue to be in a position where I can make a difference. What a horrible waste it would be if I just sat on the beach all day and got drunk. I love learning, and I think anyone who finds themselves in the position in life where they can make a difference, they owe it to themselves and to society to make a difference.
I just came back today from Europe, where I just spent three days with the elders ensconced talking about all the various crises in the world and trying to think, ‘Can we avoid a dreadful situation with somebody trying to bomb Iran or making a terrible mistake in the world? What can they do to avoid that happening? How can we — the people of Zimbabwe — be better looked after than they are today?’And so on.
There are lots of different places around the world. You’ve got Sandhurst, and you’ve got all these places that teach people to kill. There are very few universities and very few people out there that are actually trying to think of ways to avoid conflict and various areas like that. And it’s very fun.
Q: What words of wisdom would you give us in order to change, grow and realize the sky is not the limit?
It has to be step by step. It was in the case of Virgin. … We would take one box, and when we felt that we had got the financial strength to go, move and do the next challenge, we would do it. And sometimes, we would do it before we’d actually had the strength to do the next challenge, but we just didn’t (want) anyone else (to) know.
You also need some good fortune along the way. We’ve certainly had our fortunate breaks, good breaks along the way, and hopefully, we’ve made the best of those. There were occasions when we came very close to failing. If you are building a business without financial backing, from scratch, there’s a very thin dividing line — as I’m sure a lot of people in this room know — between success and failure. It’s sometimes a real battle to stay on the right side of that dividing line.
When we launched Virgin Atlantic, we had a very successful record company. Our bank went into complete panic. They thought it was going to bring everything else crashing down, and they attempted to foreclose on us. Fortunately, we had one or two companies around the world (to) supply us and lend us a little extra money, and we kept going. But it was very close, between the Friday and the Monday, where things could have gone wrong.
Q: Do you have a succession plan?
I think because I’ve done some rather foolish things in my life, attempting to fly around the world in a balloon or break transatlantic sailing records and things, I’ve had to write a will quite often, had to think about what would happen if the balloon goes down. I think it would be irresponsible not to have a succession plan.
But in a sense, I run my businesses as if I’m not there anyway. If you are a true entrepreneur, one of the things you’ve got to do very early on in building a business is, in a sense, put yourself out of work. You’ve got to be brave. You’ve got to find somebody that’s better than you to run the business so you can be an entrepreneur and think about the next project and think about the bigger picture.
There are very good managers. There are very good entrepreneurs. Find a good manager to run your business so that you can think about the next project. Virgin has got fantastic people running the Virgin group, running all the companies. And that means if the balloon bursts, companies will carry on fine without me. And it also frees me up to tackle some of the social challenges I suppose I’m finding more of interest as I get older.
And if my kids want to help me out one day — my son’s playing out in L.A. at a concert if anyone’s there — I’m sure maybe they’ll come and help me out.
Q: Are you going to encourage your children to be entrepreneurs?
My daughter has become a doctor and we’re obviously very proud parents. She spent a year working at Virgin to see whether she wanted to do conventional medicine, but we do health clinics and things like that at Virgin. … She was determined to prove herself before she came in at Virgin.
In a sense, it’s the same case with my son. He’s trying to build his own business, trying to become a very good musician and doing TV shows, doing lots of different things. And understandably, he wants to prove himself before getting involved. My son is pursuing an entrepreneurial path and determinedly. He doesn’t want any leg up from his dad, which I admire.
Q: What are you most proud of that you have done, and what would you like to do next that you haven’t thought about doing?
For all of us, it is our family. I’m proud of the fact that I will be lucky enough to have the same woman for 32 years. She’s a great mother… and (I have) fantastic children. That’s what lives on after you; you live on through your family.
The Virgin Unite Foundation … can make a real difference in the world. The advantage of a company having a foundation like that is that it’s fantastic for the 60,000 people that work for Virgin. Instead of them just feeling like they’re working for a money making machine, they are working for a company that is a force for good. So their hard work is looking after themselves, and their employment and their shareholders.
Q: Who are people you would point out that you look up to?
I think that there’s two people I would name, and that is Archbishop Tutu and Nelson Mandela. And the reason is that with Nelson Mandela , he spent 28 years in prison, comes out of prison, and not only forgives his captors and forgives the white community that had done terrible things to the black community in South Africa, (but) brings him into his cabinet. (He) unites the country. And those white people who committed those terrible atrocities, instead of sending them to the electric chair, Archbishop Tutu set up truthful reconciliation courts where there are people who come voluntarily to the courts to ask for forgiveness and apologize to the relatives of the people they’ve done these horrible crimes to.
And in that way, the country was united, and it’s a wonderful country to visit, that was the result. I think they’ve set a fantastic example for all of us. I think all of us in this room, after today, could just ring up the one person we’ve fallen out with in life, an ex-partner or whatever, and just invite them out and befriend them again, even if you don’t think it’s your fault (and) you think it’s their fault. It would make the world a better place. They set a great example in that way.
Q: How many hours a night do you sleep? And what is it that makes you realize it’s time to pull back and move on to the next thing?
Often, that’s (when) the money has run out. My wife has been exhausted in mortgaging the home one too many times. Fortunately, I think we’re just past that stage now.
I actually need a good night’s sleep. I find that people that manage to sleep well for three or four hours, it’s something I can’t do. I need a good seven hours, seven hours of sleep if I can. I think being healthy and fit is incredibly important. … Finding time to look after yourself, tennis, kites, that sort of thing, finding fun ways of keeping fit, I think is very important.
Q: Aside from business, what has been the scariest moment in your adventures? What’s next?
On attempts to balloon around the world … (I) generally ended up with a helicopter pulling me out of the sea. I think it happened on five different occasions. It can be quite lonely when you are going along at 30,000 feet in a jet stream. You’ve suddenly dropped half of your fuel and you are just heading off across the Pacific. You are determinedly hoping that you can get to Los Angeles, which we were heading for in that particular case.
Fortunately — this is where luck plays a good part in life — the winds went up from about 100 miles mph to 250 mph and we did cross the Pacific. We missed L.A. by 3,000 miles (and) ended up in the Arctic, but nearly proved that we actually crossed the Pacific, and we were the first people to cross the Pacific. …
It was great fun, but it also helped Virgin Brands get on the map and get an edge. Apart from the space travel, the next exciting area we are looking at is exploring the depths of the oceans, which are not explored. The Puertorican Trench, which is five miles from our island, is the deepest place in the Atlantic. It’s 28,000 feet down, and no one has been down it more than 300 or 400 feet. We have no idea what kinds of species are at the bottom there. And there are other incredible places, which are deeper as Everest is high. The technological problem of building a submarine to go down to 35,000 foot is vast. It’s something like 1,500 times the pressure that an airplane is subjected to. So that’s a challenge we’d love to see if we can overcome.
Q: What would you tell us we should invest in?
I think the most important area to invest in is clean energy. There are plenty of people in American who are not great leaders in global warming. … I personally think the world does have problem, and we’ve got to do something about it as quickly as possible. What is absolute fact is that we are depleting our natural resources very quickly, and the demand for oil is going to exceed supply within the decade unless we hurry and come up with alternative sources of energy. Energy is the lifeblood of everything we do. Any area of energy, preferably clean energy, there’s money to be made and there’s a world to be saved. So give it a god.
How to reach: The Virgin Group, www.virgin.com