What does Richard Branson think money is for?
Money's sole purpose is to make things happen.
"Later, it became apparent to me that businesses could be a creative enterprise in itself. If you publish a magazine, you're trying to create something that will last and serve some useful purpose. Above all, you want to create something you are proud of.
That has always been my philosophy of business. I can honestly say that I have never gone into any business purely to make money. If that is the sole motive, then I believe you are better off not doing it. A business has to be involving, it has to be fun. and it has to exercise your creative instincts."
After reading about Branson's battle with British Airways, I am believing that perhaps those that have large wealth are really just people who went into a competition that is incredibly difficult, one they shouldn't win, one that is almost impossible, and then just be tenacious enough, stubborn enough, to not stop when others have quit.
People take music far more seriously than may other things in life. It is part of how they define themselves.
How to find opportunities? Look for a way around the system - that is where the money is. If you believe in an idea, you do what it takes to make it happen. An idea with no action remains just that.
To be profitable, to make money, the skill is not in the selling, it is in the buying. You buy the right thing at the right price, you win.
For retail property always look for the cheaper end of a high end street, and watch the invisible lines.
He keeps his notes in a simple school spiral notebook where he writes down his ideas, peoples comments, and his schedule.
He believes in long term objectives - he always wants capital growth, not dividends.
He believes that it is only the bold move that will get you anywhere. You need to be a risk taker, and the art of risk is to protect the downside. Learn all you can about risk, how it works, then you relate to it. Instead of a long list of fears, it all comes down to whether it will work or not. Then what?
Branson makes decisions on people and businesses in thirty seconds, counting on intuition more than numbers. For success he usually tracks two simple numbers, for example the price of fuel and the number of passengers for Virgin Airlines.
"Every successful business man has failed at some ventures, and most entrepreneurs who have run their own companies have been declared bankrupt at least once."
Whenever one of his businesses have positive cash flow, he looks for something else to do or buy.
Richard Branson takes the skills learned at one industry and applies them at another. He adds element after element, business add-on after business add-on. Virgin is a collection of small companies that are a collection of solutions to problems Branson had. He will take an idea and once it works take that idea to another industry. He has a weakness for vertical integration.
Second choice mans nothing, you ant to be the first choice, always.
Make your copyrights as long a possible. Once you have a great product, you have to protect its reputation with vigilance.
One of my favorite lines, I want to be one of the great amateurs of all time.
Richard Branson's Condensed Business Wisdom
- Business is not about profit, it is about cash flow.
- Business is not simple.
- To be successful you have to do something and be out there, and you have to hit the ground running.
- You need a great team.
- Luck is always a good thing, don't count on it, but use it when it happens.
- Survival is the key priority.
- In the beginning every deal is make or break, be aggressive.
- Some of the best ideas come out of nowhere and you have to keep an open mind and a keen eye for them.
- Even when money is tight, you need to keep the big picture in mind. YOu will get lost in the details.
- Be curious about ideas and life
- Test assumptions, always.
- Each plan is really three things; find the right people, use the brand name, protect the downside.
- His business thrives on mavericks
- When he sees people getting a bad deal - he see business opportunity.
- The best solution to financing is a 50/50 partnership with someone. When something goes wrong, as it always does sooner or later, both partners have an equal incentive to fix it.
- It is ultimately about service, value for the money, and simple products.
- He never has a rigid idea of what business is.
- Always the personal touch, a phone call or meeting.
- He asks everyone he meets for an idea on how to be better. Everyone.
He keeps his business units small. If they get too big, he breaks them up. That way they stay fast and responsive. Small also means if something goes wrong with a unit, it doesn't take down the whole business.
When he picks a business he simply thinks, is it something he would want?
Branson loves risk. My favorite story is one where a man comes to his house and knocks on Branson's front door. He is an inventor, and he has just created a flying machine that you strap on, and he has never flown it, but if Branson would invest, he could fine tune and make it work. Branson listened. He strapped it on, turned it on, accidently launched himself up into the air, now the machine had never flown. He had no idea how to steer or land, and finally landed the craft. He liked it, and the inventor the next day, took the unit up like Branson and dies trying to land.
Would you risk your life on a strange machine you can't fly from a person you don't know?