I didn’t know much about Richard Branson before I started reading his autobiography, and the few things I did know, I didn’t really like. Whenever I saw him on TV or in the newspapers, he was either trying to set another ridiculous world record or promoting one of his numerous businesses. Always with a grinning smile on his face and a model in his arm, he just seemed like a guy that enjoys showmanship and being the center of attention way more than I personally can relate to.
However, I had people telling me time and again that his books are a must-read when it comes to entrepreneurship, and as the multi-billionaire founder of the Virgin Group, an international conglomerate of about 400 businesses, he clearly has done something right during his career. So I bought the biography “Richard Branson: Losing my virginity” and gave it a shot. A little bit to my own surprise, it turned out to be a well-written book on the life of a truly fascinating man! It not only gives insights into how the Virgin Group developed and evolved under the leadership of Branson, if looked at it more closely the book also reveals guidelines that can be generalized to success rules for every entrepreneur. And these rules are so powerful that I want to share the three main ones here.
1. Be passionate
The main reason why most people want to start their own business is because they finally want to do what they truly love. They want to follow their calling instead of working a job they don’t actually care about.
Richard Branson is a prime example for that. Whatever he does, he does out of passion. Other factors, like making a profit or creating publicity, are important too and have to be considered, but passion is the real driving force behind all of Branson’s projects. If he gets intrigued with something, may it be starting a new business, flying around the world in a hot air balloon or fighting the world’s problems through charity, he is extremely determined to put his plans into action and doesn’t stop until his visions have become reality. This kind of persistence, often over years and against all forms of resistance, can only be sustained when fueled by genuine passion. Passion gives you the energy to work late nights and weekends, passion is what draws other people in and gets them excited for your ideas. Passion is the motor that keeps a company going. No other incentive, may it be fame, money or something else, is able to replace that in the long run. An entrepreneur without true passion for his business is destined to fail.
2. Be willing to continuously risk everything
Starting your own business always involves taking quite a lot of risk. The easy way would be to just stay an employee and keep relying on the guaranteed monthly pay-checks. Everyone who is willing to give up this safety net in order to become an entrepreneur has already proven the ability to handle the stress of more risk and less security in their lives.
Once the start-up business is turning profitable and getting more established however, a lot of entrepreneurs tend to start playing it safe. Rather than continuously expanding their business into new markets, risking set-backs and failure, but ultimately growing their brand, they try to maintain what they have. This kind of strategy makes companies passive, inflexible and ultimately an easy target for competition.
Richard Branson on the other hand never played it save. Even after decades of working and founding countless of companies that generated hundreds of millions in revenue every year, he and his Virgin Group always were relatively low on cash. Why? Because Branson reinvested the profits into new projects as fast as they came in! From running a magazine he moved on to selling records. From that he moved on to founding a record label. He then started Virgin Books. And Virgin Money. And Virgin Mobile. And Virgin Trains. And so on. As soon as one company is turning profitable, he moves on to the next.
Often times he would use bank loans to further pursue his plans and then later use new loans to pay off the old ones. This of course was a highly risky game and more than once the entire Virgin Group got dangerously close to bankruptcy. When Branson for example entered the airline business with Virgin Atlantics, it put every other of his numerous businesses at stake. At one point, right after the very first flight of Virgin Atlantics, the banks declined to extend his credit line any further and said they would bounce every check that puts Virgin over this credit line, which would have resulted in the group going bankrupt and 3000 people losing their jobs. Fortunately, Branson managed to avoid this worst case-scenario at the very last minute.
This however demonstrates Richard Branson’s willingness to continuously risk everything he has worked so hard for in order to move forward. His entire business philosophy is based on the deep understanding that there is no such thing as staying successful while maintaining the status quo. You have to move forward, constantly reinventing your company, in order to stay ahead of the curve. And this is only possible through taking risks, time and again.
3. Beat the odds
Richard Branson was never good at school. Due to dyslexia he had a terrible academic record. However, when he graduated from high school at the age of 16, he was determined to start a student magazine. He didn’t care that he was only 16, that none of his high school experiences had been encouraging or that he knew nothing about journalism. Branson later stated that he was simply too naïve to notice that he was doomed to fail. That’s why he tried anyway and that’s why, against all odds, he succeeded. With the help of friends and family, he managed to grow “Student” to become the largest magazine of its kind in England, regularly interviewing icons like Mick Jagger or John Lennon.
Throughout the rest of his professional and private life he then challenged the common beliefs of what is possible. He founded businesses in areas he knew little to nothing about, may it be record labels, airlines or even space travel, and turned them into globally successful parts of the Virgin Group. He set several world records, including the fastest crossing of the Atlantic Ocean both on a boat and in a hot air balloon.
When people hear all this they nowadays may say: “Well, yeah, he did all this, but he is Richard Branson! I could never do this!” What they forget though is that before he became ‘Richard Branson, billionaire and adventurer’, he was just Richard Branson, a guy who wouldn’t let bad odds hold him back.
Of course there is more to becoming a successful entrepreneur that merely these three rules. You have to work very hard. You have to have good timing. You have to surround yourself with the right people. And last but not least, you have to have some luck. But if you are looking for the underlying principles that separate entrepreneurial role models like Richard Branson from the rest of the crowd, these three are a good starting point:
– Be passionate
– Be willing to risk everything
– Beat the odds
If internalized and continuously executed, they help reducing the risk of failure to a minimum.