Lord Sugar is one of the UK’s best-known entrepreneurs. Having made his name as the founder of consumer electronics company Amstrad, which was sold to BSkyB for around £125m in July 2007, he’s now equally renowned for his role on BBC’s The Apprentice.
Whether in this guise, as an entrepreneur, as former chairman of Tottenham Hotspur FC or as the government's former 'Enterprise Tsar', he’s never been one to shy away from speaking his mind. At the recent Business 2012 conference, Startups found him on typically brusque form. But it was also a rare opportunity to hear some of the key lessons he's learned throughout his career in business, and from his phenomenal, self-made success.
In part one of a four-part feature summarising his key insights and advice, he extols the virtues of self-funding your start-up, emphasises the need to be realistic when you're starting a business, and explains why he's gone into business with not one, but two, stars of the last series of The Apprentice.
We launched the first episode to the media. Following on from that Tom Pellereau, the winner last year – and the first time I’ve invested on the programme – launched his range of nail file products. I also launched another business, Tropic, a skincare range with Susan Ma. She didn’t even get into the final. Now there’s a case of determination I haven’t experienced in over 50 years. She worked hard and relentlessly. She also convinced me to go into business with her.
You’ve got to have a good business model. Personally, I’m sick and tired of everyone who wants to come up with a new social media website. It’s important for people here to recognise that business here is different to the US. Zuckerberg is a one in a trillion. The problem is people don’t get on with starting a business in a conventional way now. They’re waiting for something magical to fly off. We need to instil that starting a business from scratch is the right thing to do – with your own money. You’ve got to get this culture out of your heads that banks are going to provide it. They need to see revenues, a business model, and other collateral. Get over it; it’s not going to happen. Think of starting something small.
You’ve got to focus on a weekly review of what you’re doing. Not everyone can be in a business where you buy a bottle for a pound and sell for two. But it’s great to have a weekly or daily wake-up call, even if it’s to clear £500 a week, or £1,000 a week. People get carried away with spreadsheets and business plans and forget the basic principles. I remember thinking to myself, I’m going out on Monday and I need to think about how much margin I’m making and what I’m doing. I know it doesn’t apply to every business in the world, like consultants, but you’ve got to keep on top of costs and overheads. Set simple goals and don’t give up until you do it – and stop dreaming that someone is going to give you something to do it.
The Daily Mail put me on the front page as those slags always do. You’ve most probably got a Daily Mail journalist here today. They’ll probably take something I’ve said out of context. If you’ve got one near you, you can probably smell them. With the power of Twitter I’ve quietened them down a bit. My following’s more than their circulation.
I take it you mean in business. There’s fear and there's fear – like going to see Spurs and hoping they’d win a game. There is a fear in business that you’re going to gamble and risk and something’s going to go wrong. You’ve got to weigh up in your mind whether you’ve got the confidence to do what you’re going to do.
I can only talk about my experience. I’ve never been a consultant. I’ve always designed, innovated and made stuff. Fear is when you design a product and you don't have confidence in it and you have lots of ‘yes’ men and women saying it’s marvellous. You can’t make one or two of them. You’ve got to make 100,000. You have to have the guts to go and spend that money. You have to have the confidence you might lose it. So, yeah, there’s fear there.
Lord Sugar was speaking at Business 2012, at London’s O2 Arena