“Maybe it is the age of the celebrity entrepreneur”
“Maybe it is the turn of the entrepreneur. We have had celebrity chefs and celebrity footballers now with the likes of Richard Branson, Alan sugar etcetera… we have celebrity entrepreneurs, and that inspires others to be like them,” says Stephen Fear, the man behind the Fear Group, a company with a turnover in excess of £100 million, not to mention a judge at this year’s NatWest Great British Entrepreneur Awards. But when you speak to him, a sense of morality and decency shines through – this is his take on what it takes to be an entrepreneur, entrepreneurship in the UK, advice for budding entrepreneurs, and what the government can, and indeed should, do.
“The villainous entrepreneur makes good TV, the loveable rogue – Del Boy Trotter, Arthur Daley etcetera, but the reality is that most entrepreneurs have family, believe in society, and of course they want to make money.” Stephen adds: “Being an entrepreneur is about balance, most entrepreneurs don’t want to live in a mansion when the neighbours are in a tented village, or wear a Rolex watch when the neighbour cannot afford egg and chips!”
And that takes us to education.
But first, a little about Stephen. He is sometimes known as the Phone Box Millionaire, after he founded a commercial oven cleaning business when he was just 15, and sold to new clients from a phone box. According to Wikipedia, he is essentially self-educated, all the more impressive when you hear he was awarded a Doctorate in Business Administration (DBA) from the University of West England. All the more impressive when you hear that from 2012 to 2016 he was the Entrepreneur in Residence and an Ambassador of the British Library.
Not that Stephen told me about that. “My business is property development and investment, around that business circulates investment in SME’s, new inventions and new ideas and the putting together of trade programmes.” He then gives as an example, plans to “import wine from Georgia the former Soviet Republic, where they have a long history of wine making and have traditionally sold wine to Russia.”
And Stephen is a believer in starting the process of encouraging entrepreneurs at school: “Entrepreneurship should be a part of the national curriculum so that kids growing up understand what business is all about and that should also include ethical entrepreneurship. I think that by teaching the kids that business can be a force for good and by teaching them to be responsible business people rather than being mavericks, would be a good thing. By educating young people in entrepreneurship it would give us an opportunity to create a more balanced entrepreneur.”
But then Stephen is also a fan of encouraging entrepreneurs. We talked about TV shows such as The Apprentice and Dragon’s Den, “I believe in encouraging entrepreneurs and not trying to show them up for the purposes of the camera.”
Focusing on the Dragon Den, he says: “Some of the people have been excellent.” He cites James Caan as an example. “He was always very positive and spoke to people in a gentlemanly manner, but that hasn’t always been the case with all of them. I especially try to encourage young people, if they don’t leave with an investment, I will try and give them encouragement. Even if the idea is obviously not going to work, rather than criticise I would rather appeal to their entrepreneurial spirit and hopefully they will come back in six months and come up with something else.”
From that we turn to failure. “James Dyson had so many setbacks in the beginning, he now has a world beating business, if he was ‘hammered’ in the very beginning, as a young man, he may not have gone on to employ all the people in the UK and pay into the UK exchequer.
“Failure is a fact of life for entrepreneurs. Every entrepreneur I know has dealt with failure.” But then he warns “you shouldn’t be ashamed of failure but you shouldn’t court failure. Being blasé with investors’ money is not okay. You should always try hard not to fail! Think twice and act once.”
So, what is it like? How challenging is it to become a successful entrepreneur?
“People talk about zero-hour contracts,” he says, “but most start-up entrepreneurs don’t have zero-hour contracts, they have no contract and no minimum wage and possibly their house on the line from borrowing as well, so the entrepreneur that makes it deserves it, because they have put a lot on the line.”
What about advice? “Keep overheads low – you do not need flashy offices, or expensive cars when you start out. If you can work from home initially, there is nothing wrong with that because you are not spending out on offices. Hire in people by contract initially, because there is a lot of expense in taking too many people on too quickly – they are a big overhead. Don’t commit to any long-term leasing, or long-term borrowing of any type. Try not to sell equity too cheaply, it is sometimes cheaper to pay interest than sell equity. It isn’t always the person that will put the most capital in your business that is the perfect partner, someone with lots of advice is often more helpful.”
“The budding entrepreneur should go out and understand cashflow. If cash is king then cashflow is queen! Without cashflow you will hit a wall, having capital is no good if you can’t access it. Get into the habit of not taking time off, even when you are your own boss. Get in the habit of saying ‘No’ to invitations and be prepared to work hard.”
Where Stephen does have a concern is with mentors – not all, but some. “One of the things that I would say to young people is that if you are going to take on a mentor, make sure that the mentor is qualified to do so. There are a lot of people out there that are charging fees to start-ups and in fact they have never created anything themselves, check you mentor out! This is really important. These ‘coaches and experts’ can offer business advice without ever being in business.”
He continues: “I know that there are various government programmes but I would like to see a national definitive one where there is a coaching programme that will give the right type of advice.”
And how does he run his business?
“My business model is the John Lewis partnership. People ask how many employees do you have? I say, ‘I have no employees, I have a lot of partners but I don’t employ anyone because we try to give a profit share to everyone in the business that they are involved in’. We think that is a responsible thing to do.” It’s hard to disagree with that.
The UK is emerging an entrepreneurial success story – but more needs to be done, and one way to achieve this is to shine the media spotlight on entrepreneurs, their challenges, their failures and of course their successes.
The NatWestGreat British Entrepreneur Awards are currently open for applications, and entrants can apply here.