July 2008 Archives

It could have been the brilliant final scene of The Usual Suspects where we realise Kevin Spacey’s Verbal has fabricated the wondrous illusion of Keyser Soze from papers lining the walls of the detective’s office (see below) or it could be the time Microsoft told me competitors once hired a neighbouring office to try and peak at a top secret presentation, but whenever I visit a company’s office I’m always fascinated by what’s on the wall.

Indeed, you can often learn more about a big company and its processes from the remnants of meetings,brainstorming sessions or signs for staff than an interview with its PR-savvy CEO who's rattled off the same polished story a million times before.

That wasn’t the case with the media company I visited recently whose boss is lovely, but the flipchart scribbling left in its meeting room made interesting enough reading for me to want to scribble it down.
It looks like it was a summary of a management or staff training/strategy session and was titled ‘team behaviours’:

Value the team
Flat management
Acceptance of each other as individuals
Open and honest but be respectful of each other
Play to each other’s strengths
Best idea not the loudest idea
Everyone encouraged to speak
All ideas are valued
Always consider new ideas and ways
Forget past lives, enjoy the future
Embrace constructive criticism

Really healthy stuff, I reckon and definitely reflected in the relaxed, democratic and motivated feel to the office. Far healthier than the instructions for work experience students I once found in one of the UK’s largest and esteemed organisations, which began, ‘1) Don’t ask questions’.

I’ll keep reporting my nosy parker findings, but let’s hear about yours as well!

Last night’s Dragons’ Den was a classic, with two DD firsts and one poor guy being practically set alight by the dragons' fury!

First, Clive Billing was offered a DD record £255,000 for a 40% stake in his online jewellery retailer Diamond Geezer from Peter Jones, James Caan and Theo Paphitis – and then turned it down! “I’ve no regrets whatsoever, it wasn’t a fair offer,” said Clive, who was holding out for 20%, after the show.

He’s confident he’ll get a better deal elsewhere. Given Clive only made £3,000 from £1.6m turnover last year and has liabilities of approx £300,000, we’re not so sure! And fancy passing up on the opportunity of adding three dragons to your board!

The unique aspect to Peter Jones’s £75,000 investment for 35% of Victoria McGrane’s fledgling fashion company Neurotica was that she’d only asked for £56,000! While one by one the other dragons balked at Victoria’s obvious failure to budget for stock to meet supply orders, Peter readily upped his offer to account for the oversight.

While hardly a first, the dragons were also at their fiercest best. Diamond Geezer Clive got a stern reprimand from Deborah Meaden for having broken the show rules by previously contacting her, while unimpressed Duncan assured him the pleasure in their meeting was all Clive's.

The real pasting was saved for Richard Mire and his Screen Machine idea to help parents control children’s TV viewing. The dragons’ nonplussed reaction was just the start; the real action began when Richard revealed his other business made £300,000 last year.

“Get out of here. GO AWAY!” screamed Theo, repeating it several times. When the chorus of abuse subsided, James Caan spelled out Richard’s crime for him: “So this is such a amazing idea you want to put £2,500 in for 85% and I’m going to put in £150,000 for 15%?! I’m a bit disappointed that you think we’re that stupid.”

Duncan Bannatyne quickly lowered the tone again, sending Richard packing with possibly the hardest exit line in DD history: “I wish you absolute failure. I hope it doesn’t take off. I hope people don’t buy it, I hope it fails. I think it’s ridiculous.” Just in case that didn’t fully clarify where he stood, Duncan added the all too familiar “I’m out.” Harsh. But, on reflection, probably fair.

If you missed, catch it iplayer until Monday.

Brits are pitching their tents and going camping for their summer holidays this summer. Entrepreneurs will be joining in too with September marking the return of last year’s highly-successful Seedcamp, where a more familiar form of pitching will be on the agenda.

The week-long experience will see 20 selected start-ups undergo an intensive investment-readiness programme, with the help of a diverse mentor network of serial entrepreneurs, corporates, product designers, venture capitalists, recruiters, marketing specialists, lawyers and accountants.

At the end of the week, five of the companies will win €50,000 in exchange for a 10% stake. Those five then get the same ecosystem of experts for an extended three-month tutorship which, in addition to more intensive scaling up, includes two investor presentation days.

Organised by Index Partner’s Saul Klein, founder of Video Island and former VP of marketing and e-commerce at Skype, Seedcamp has representatives from Google, Microsoft, NESTA, Cisco and Mizilla on its advisory board.

If you’re an early stage idea and meet Seedcamp’s flexible criteria, you’ve got just under two weeks to apply.

Oh, and don't forget those tentpegs...

Image: Flickr

A novel idea it might be, but I can’t see the Sony Reader catching on.

The ebook that stores 160 downloadable novels hit UK stores this week. Priced at £199 and weighing 250g, every battery charge allows 6,800 page turns.

Now I might be missing something here, but when would you ever need, or more importantly, want access to 160 novels? Possibly if you were circumnavigating the globe or locked in a world of 24hr Big Brother, I suppose. And if you did why would you want to read them via screen and have to manually click for a new page every 17 lines or so?

OK so it’s easy to say it now, but MP3 players worked because they improved the alternative experience. We love being able to shuffle, flick and rotate our record collections, while 8,000 7” vinyls and a turntable always were a bit of a bitch to get on the bus.

MP3 players also worked because iPod made them look cool as funk. The ebook looks like an Etch-A-Sketch in a cheap suit.

Great ideas are solutions to problems and improve experiences. It feels like the ebook is a semi-solution searching for a problem that doesn’t exist.

Unless you’re likely to sweat profusely, turn into a jabbering wreck and alert the nation to your insanity by admitting you’ve pumped your life savings into patenting chocolate fireguards, you should seriously consider trying to get on the next series of Dragons’ Den.

And that’s whether your company needs investment or not.

When I met Gavin Wheeldon of translation service Applied Language Solutions last year I asked him if he regretted his appearance on the show where he was blasted for overvaluing his business by asking for £250,000 in exchange for just 4%.

“Not at all,” he replied. “I never expected to get invest at the rate I knew I could get it elsewhere, so it was all about the publicity. How else do you get your business on TV in front of millions of people for free?”

He’s not alone in entrepreneurs who’ve used Dragons’ Den to their advantage without raising cash. For some it’s as simple as spinning a ‘look what the dragons got wrong’ PR story.

That’s worked for Rob Law’s children’s luggage company Trunki, which has gone on to be stocked in 24 countries since Peter Jones told him: "I meet people like you all the time - you think you have something. I tell you, you don't. Within seven days I could do a better job than that. Your company is currently worthless."

And then there's Rachel Lowe who just months after admitting she didn't 'know her figures' saw her board game Destination became Hamley’s best-selling Christmas present. It's now up to its 15th edition and Rachel's held talks with Walt Disney about movie versions.

Hamfatter, the band that on Monday night did secure funding from Jones, are also basking in their 15 minutes of fame. They’ve enjoyed plentiful press coverage over the past few days but the impact was even more immediate according to Play.com, which reported the band’s downloads rocketed between 10pm and midnight on Monday.

You can apply here. Unless

Occasionally, when pressed for time, team Smarta buys its lunch from Boots. Busy or not, it won’t anymore.

Why? Well we’re not overly keen on Boots' selection of sarnies anyway, but we’re certainly not impressed by this news story that Boots is putting the, er, boot in on many of its small suppliers.

Changing payment terms from 30 days to 75 days from the end of the invoice month (so effectively up to 105 days) and introducing a 2.5% ‘settlement fee’ for actually paying the bill, stinks of exploitation and ‘I’m all right Jack’ protection of profit margins as times get tough.

Well our lunch money isn’t going to support such bully boy tactics and we suggest yours shouldn't either – although, before you point it out, that’s not really going to help the small suppliers, is it?

Theo Paphitis, Peter Jones, Deborah Meaden, James Caan and Duncan Bannatyne return to our screens tonight with the sixth series of Dragons’ Den.

As the now celebrity entrepreneurs have been popping up everywhere from Saturday Kitchen to Top Gear, it might seem as if they’ve never been away, but tonight it’s very much a case of getting back to business.

The line-up for the first episode sticks to the tried-and-tested recipe of more zany inventions, bungled pitches and absurd propositions than genuine business opportunities, with just as much to learn about ‘how not to raise finance’ than anything else.

This week’s carcrash presentation comes courtesy of John Foster-Smith and Ros Adams. Their attempt to secure £50,000 for Layline, a bed sheet with a dividing line aimed at solving night-time squabbles among bed-hogging couples, begins with them lying on the studio floor recreating that scenario in front of the dragons. It’s hands-over-the-eyes, scream-out-loud viewing.

A machine that turns air into water and a green events company sound more promising, while Cambridge rock band Hamfatter offer to share lifetime royalties in exchange for £75,000 to make an album.

If you can’t wait until tonight (BBC2, 9pm), there are several video previews on the beeb’s swanky new Dragons’ Den website. Shame they don’t share their videos so we can embed them here, but hey, it took them this long to work out entrepreneurial business actually interests the mainstream...

Hurrah for Linda Bennett, who’s today £100m richer having sold a controlling share of her 100% stake in designer shoe retailer, LK Bennett.

The sale tops off what’s been a true entrepreneurial success story.

A graduate of renowned shoe design college Cordwainers, Bennett got experience of the manufacturing process at Robert Clergerie’s factory before working on the shop floors at Whistles and Joseph.

Having spotted a gap in the market for the ‘kitten heel’ being paraded down the catwalks, Bennett opened her own shop in Wimbledon in 1980, using £13,000 savings and a £15,000 bank loan. Dubbed the ‘kitten-heel queen’ she now has more than 70 shops across the UK.

Bennett hasn’t always enjoyed the nicest of press, however. Notoriously media-shy, she rarely gives interviews and has paid the price at the poisoned pen of several scorned journalists.

For want of an example, in 2004 The Sunday Times dubbed her, “short, stocky... dressed head to foot in black like a rather beautiful hamster off to a funeral”. Around the same time there was little sympathy when Bennett withdrew the company from sale when bidders failed to match her £75m valuation – especially when Tamara Mellon offloaded Jimmy Choo for an extra £25m.

I guess she’s the one laughing today, especially as none of those papers seem to have any quotes to go with the story!

Aside, the deal also has to be seen as a big positive among the retail doom and gloom. Buyers Pheonix Equity Partners have proved there’s still room for top level acquisitions, while the fact LK Bennett saw a significant jump in profits on £45m sales in the first half of 2008 to attract the bid can’t be a bad sign either.

Team Smarta has spent the week bickering, agonising, no, 'healthily debating' homepage designs. It’s all about striking balances, don’t you know...

White space ‘v’ content showcasing; Impact ‘v’ subtlety; Vision ‘v’ impression generation. And that’s before you even enter the conflict zone of video, branding, and advertising.

In a desperate bid to find enlightenment I went off in search of the web’s best homepages. OK, in truth, I spent half an hour surfing around and came up with this top five. Here it is in reverse order:

5. TimesOnline – much copied (but yet to be bettered) by other publishers seeking a busy but good looking homepage.

4. Ebuyer – not an obvious choice and won’t win many beauty awards, but this ugly duckling does a brilliant job of presenting a text-heavy product directory that’s nice and easy to navigate.

3. Apple – design gurus are an obvious destination and never disappoint. Always get what you expect in a presentation that still succeeds in inspiring. Always clean and simple.

2. Moo.com – A bit web 2.0, a bit flickr (which could easily have made this list), Moo wins for one reason: you can’t look at it without wanting to immediately buy and, even better, buying looks so easy. A lesson in product impact and e-commerce.

1. Google – Predictable, obvious, but who cares. Big white screen, search box, logo – exactly what else do you need?

It's all subjective, of course, so let me know your thoughts and favourites by commenting below. Next up logos!

The biggest challenge facing David Cameron at the moment must be keeping a straight face. Surely there’s nobody else in the country finding so many upsides to Gordon Brown's desperate bid to dispose of power?

Economic woe deepening by the day; business groups shrieking ‘told-you-so’ as insolvencies escalate; unemployment hitting a 16-year peak. Add in spiralling petrol and food costs, a knife-crime epidemic and a catalogue of bungled PR-disaster responses from the dead-man-walking and his cabinet of corpses and Cameron’s weekly Daily Torygraph column kinda writes itself.

Of course, this is nothing new. Cameron’s had a cushioned ride for months now. What makes today's response worthy of comment is, rather than basking in the government’s eminently-baskable inadequacies, there’s actually some policy. Yes, P-O-L-I-C-Y.

First off, the introduction of the US’s Chapter 11 bankruptcy policy, which gives struggling companies protected breathing space to negotiate repayment plans with creditors while continuing to trade under certain constrictions and, crucially, stay in control of their assets. It’s not liked by everyone in the US and there are arguments it's anti-competitive, but it does keep viable businesses with long-term revenues afloat to sort out cashflow crises.

Cameron’s ‘economic recovery plan’ also pledges to cut red tape; introduce a fair fuel stabiliser to crackdown on profiteering petrol companies; limit public spending in order to invest in manufacturing, science and engineering and, as a result, lower taxes.

OK so talk is cheap and who believes politicians nowadays, anyway? But at least we’re seeing some kind of practical solutions here – not 'be good people and save your scraps’ suggestions from Mr Not So Prudent.

If that's all the 'government' has to offer the public as we hurtle towards recession, what's the message for business? Do you know? Answers on a postcard please (or below actually).

I like Levi Roots, the founder of Reggae Reggae Sauce who rose to fame on Dragons’ Den when he serenaded his way to securing £50,000 investment from Peter Jones and Richard Farleigh.

His sauce has become a staple product on supermarket shelves, initially selling out within days when Sainsbury’s became the first to stock it. He’s since launched several variations to the range, released his first cookbook last month and has opened the ‘Papine Jerk Centre’ in Battersea.

You might have seen Reggae Reggae Sauce’s latest coup, a partnership with sandwich franchise Subway, advertised on TV over the weekend in what looks a brilliant branding deal. The image above is currently a blanket homepage overlay ad on www.subway.co.uk!

Despite this, there still seems to be a degree of snobbery towards Levi. I’ve heard various people comment that he’s not a ‘proper entrepreneur’, attributing the success of Reggae Reggae to its investors and not to Levi who just ‘got lucky’.

Now I’m sure Levi wouldn’t have got the company to where it is without the expertise, contacts and, of course, funds of the dragons, but to belittle Levi’s contribution isn’t on. After all, it’s his creation and the brand revolves around him. That said, Levi is more than a figurehead and has clear views on how the company should progress and its ethics.

He gave all proceeds from the release of the Reggae Reggae Sauce Song to Comic Relief, dedicates a percentage of profits from the Papine Jerk Centre to sickle cell research and pledges that anyone from the local community can visit the takeaway and receive a meal, no matter how small or basic, with what they can afford to pay.

Levi is also working hard to promote enterprise in Brixton, taking part in numerous schemes and frequently giving talks on the value of entrepreneurship to the borough’s disadvantaged youth. He's also used his fame on a national level, supporting last year’s Startups Awards as a judge and personally congratulating the winners.

Levi’s ability to twin social enterprise ethics with the hard business world of supermarkets and global franchising partnerships deserves recognition, not cynicism. Why in this country do we seem to begrudge people who get a break? After all, you make your own luck, don’t you?

It’s Friday, so what are you doing tonight? How about trying out Club4Climate, Britain’s first eco nightclub?

Based in London’s Kings Cross at Bar Surya, this genius idea is the brainchild of property entrepreneur turned eco dance warrior Andrew Charalambous, aka Dr. Earth. It officially launched last night showcasing what Charalabous sees as an eco blueprint for other clubs to follow.

The club uses poly-carbon cups, which it claims are the world’s most sustainable drinking utensil; recycles all glass, metal, paper and plastic materials; airflush waterless urinals; uses screens to educate clubbers on the perils of climate change; offers free entry to clubbers who can prove they arrived by foot, cycle or public transport; and makes all its clubbers sign a pledge to curbing climate change.

By far the most impressive feature though is the dancefloor which generates electricity when people dance on it! The more people shake their eco asses, the more electricity is produced! Check it out:

Charalabous has grand plans for Club4Climate including an eco holiday destination and he’s pledged to donate all profits to Friends of the Earth, despite the organisation distancing itself from the project over concerns the island would encourage international travel.

Dancefloor image: Daily Mail

Last week I launched Go Green Plumbing London Plumbing Company, which we put together in less than 8 weeks.

I really wanted to take plumbing and drag it kicking and screaming into the 21st century.

We have launched in central London and have a great team of skilled plumbers driving around in electric vans. They are hilarious but save us a huge amount of petrol, c-charge and parking; so we are even cheaper than our competition.

Finding good quality plumbers was the hard work but we have a great plumber in charge of the company.

Starting a company like this in such a short amount of time just shows what can be achieved when you put your mind to it.

Freecycle, the internet swap shop that allows people to obtain goods and services for free, is deservedly enjoying lots of publicity (Times - Telegraph) as the press hold up its popularity as evidence of the credit crunch.

Started in Arizona by eco-warrier Deron Beal in 2003 to reduce the number of unwanted white goods dumped at landfill sites, Freecycle is now attracting 200,000 new users a day, was used by 1.2m people in the last year and thinks it will have enabled five million free transactions by the end of the year.

Once a way of recycling unwanted items, Freecycle is now a middle class market for school uniforms, furniture and car repairs if you believe what you read.

Either way, it’s fascinating to see the simplest of age-old ‘hand-me-down’ cultures transferring so successfully onto the internet. And even if opportunistic car boot traders and the middle class weren’t part of the original eco vision, they’re all contributing to a reduction in waste and eagerness to recycle.

While it carries sponsorship it’s unclear how profitable Freecycle is, especially as most of its activity is carried out using Yahoo groups. However, its growth in popularity suggest there’s still massive potential in the sharing over the internet of not just opinion and information but possessions, services and expertise. Good news for sites such as horsesmouth and others looking to break this space.

Deal news seems to have been dominated by entrepreneurs making hasty exits this year following the hike in capital gains tax and faltering economy. So it was nice to see Michelle Mone and husband Michael regain full control of lingerie company Ultimo.

They acquired £800,000 of shares back from serial entrepreneur and philanthropist Sir Tom Hunter and Arcadia COO Ian Grabiner, who’d helped save the company from the brink of collapse soon after launch in 1999.

Now prospering with five brands under holding company MJM International worth an estimated £45m, it’s a success story all round. Mone says Hunter has been extremely supportive over the years but has also made a healthy profit on his investment, reported to have been around the £200,000 mark.

She’s also confident of further growth, insisting the company is yet to feel the impact of the downturn and with plans to launch a new ‘Young Ultimo’ range later this year.

It’s not said often enough, so we’ll say it. Entrepreneurs give plenty back, create wealth, share knowledge and actively look to improve society. There you go.

What prompted today’s little backslap? Seeing the sterling work Tristram and Rebecca Mayhew, husband and wife founders of high-wire forest adventure site Go Ape, and Tim Campbell, founder of the Bright Ideas Trust, in a bid to raise £1m for the Prince’s Trust.

Tristram, Rebecca and Tim were the faces behind yesterday’s launch of the Million Makers initative, marking the 25th anniversary of the Prince’s Trust’s Business Programme, which itself has helped more than 70,000 young people into business since 1983 but needs £1million every month to continue its vital work.

The initative will see employees from 50 companies including The Royal Bank of Scotland, Accenture, Axa and Oracle competing in various challenges and start their own enterprises in a bid to raise the cash.

"Million Makers is a unique initiative for budding corporate high-flyers; not only will it help The Prince's Trust to raise £1million, but it provides a structured learning and development opportunity for companies and participants," said Tim.

Great work guys and we salute you. Just one question: why isn’t the government putting in the same effort to support an organisation that’s contributed more than its fair share back to economy? It used to match, pound-for-pound, funds The Prince’s Trust raised, so why doesn’t it now?

That question was asked to Shriti Vadera, Parliamentary Under-Secretary of State for Business and Competitiveness, at a Prince’s Trust event in May. She denied all knowledge of this fact but insisted she’d look into it. Any update yet, Shriti?

ASOS, the online fashion retailer, has always been a smart operation.

When its warehouses were destroyed in the Buncefield depot explosions in December 2005 on its busiest day of the year, it lost £3.8m worth of stock, had to cancel Christmas, refund 19,000 orders and suspend the company’s share price.

Unlike many, it was insured to the hilt and had a robust disaster recovery plan. When it reopened six weeks later it took a record number of sales on day one.

With a record for resilience, an economic downturn wasn’t likely to see ASOS roll over and die then. Once again it has found itself well prepared, welcoming shoppers flocking to it from the high street with sales up 95% during the 13 weeks leading up to June 27.

It’ll look to further capitalise on their thirst for a bargain by launching a clearance website for excess and discounted stock and offer an alternative to the roaring clothing trade on eBay.

“Everyone is waiting us to take a stumble and the good news is we absolutely haven’t,” said CEO Nick Robertson today while announcing full year profits had more than doubled to £7.3m (3.4m) on turnover which increased to £81m from £42.6m in the year to March 31. Margins and average spend were also up, while its share price has tripled inside a year.

Just goes to show if you get your model and proposition right, and keep one eye on what's around the corner, there's plenty of life left in retail.

Should women be treated differently in business? As a man I’ve never really felt qualified to give an opinion on this one, but shared plenty of debates with women who’ve passionately defended / rubbished the need for female-only business groups, networking events, awards etc.

At the core of this comes the belief that women do or don’t face greater or different challenges than men, or, less tangibly, do business in a different way.

Three things got me thinking about it again this week:

Firstly, Rachel Elnaugh prompted accusations of sexism when she claimed women are more ‘emotionally attached’ to their businesses than men. She’s backed it up using stats from her Entrepreneur Profiler data which shows 54% of men were motivated by money and material drivers as opposed to 34% of women who instead pointed to emotional drivers.

Secondly, Enterprising Women launched a £10m fund in conjunction with Lloyds TSB to finance loans, training and mentoring. UK female entrepreneurs can borrow up to £30,000. Chief exec Bev Hurley says there’s a real need for it:

“Women say that they are often discouraged from seeking business loans, have been advised that re-mortgaging their homes would be a better, or the only, way of financing their business, charged a higher interest rate. They also report that some funders still have very traditional assumptions and stereotypes about women's enterprise.”

There are of course, plenty of exceptions. When the government announced plans at the last Budget for a new £12.5m fund for entrepreneurs I was impressed by Texperts founder Sarah McVittie’s reaction. “I’m not sure we even need it but £12.5m is actually quite insulting if it’s for every business woman in the country. I’ve raised £3m on my own, so what's the point?”

Finally, we’re busy building the real Smarta site due to launch in November and still can’t decide whether to include a specific space for female entrepreneurs.

We're leaning more to McVittie than Hurley or Elnaugh, and it all feels, well, archaic; and by putting people in boxes surely you're only perpetuating the problem not solving it? Love to hear your views.

Image: Flickr

Big respect to real estate company MEPC (nope, I’d never heard of them before either), which is building a £6m incubator entirely from its own funds at its business park in Abingdon, Oxfordshire.

The incubator will house 60 university spin-outs and will be run by Oxford Innovation, a specialist facilities management and angel investment company.

It’s great to see such a project coming out of private money, as the flexible lease demands and high failure rate of science start-ups that tend to occupy incubators usually put off developers and commercial landlords.

Speaking to the FT, James Dipple, MD for MEPC Milton Keynes, said: “We are providing a space for start-ups because some of them will grow into big companies.”