Deborah Meaden – Director magazine, Sept/Oct 2018

IN THIS SECTION

An entrepreneurial masterclass with Deborah Meaden p21 | How to build a business that’s powered by change p26 Ask the execs p30 | Terra Firma’s chairman, Guy Hands, on the lessons he’s learnt p32 | Lead like… Barack Obama p34

COVER STORY

DEBORAH MEADEN’S 15

GROW TH TIPS IN

HAIR AND MAKE-UP: JULIE READ AT CAROL HAYES; STYLIST: SYMONE KEISHA AT FRANK AGENCY

5 MINUTES

The formidable investor is no stranger to the trials and triumphs of business – from being left in debt by her first venture to exiting Weststar Holidays in a £33m deal.

The entrepreneurial advice she offers here may take only a short time to read, but it could give your business a lasting boost Words Hannah Gresty Photographs Tom Jackson

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Meaden started in business at 19, supplying Italian ceramics to British department stores.

She had sole agency rights with the manufacturers, but had to dissolve her firm after 18 months when they started supplying other UK shops.

She led a management buy-out of Weststar Holidays

in 1999 and sold the company in 2005 to Phoenix Equity Partners in a deal worth £33m.

Her remaining stake was liquidated in 2007, with an estimated value of £19m.

She has starred in BBC2’s Dragons’ Den since 2006 and is involved with several animal and conservation charities.

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FOCUS ON YOUR FUNDAMENTALS

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MAKE AN INVESTOR F E E L WA N T E D …

“It’s vital in any presentation that an entrepreneur can demonstrate clearly what their proposition is – the customer, the market, the usual technical stuff. But the thing that makes a pitch really good is when they can tell me why I’m their potential investor. Why have they chosen me?

What will I get out of it? Make me feel wanted, make me feel like you’ve said to yourself: ‘Of all the possible investors, we want to talk to Deborah.’”

“Early in my career I asked [hotelier] Rocco Forte for one piece of advice – the usual question you ask when you’re young – and he said: ‘Don’t lose sight of what matters.’ In business it’s very easy to get caught up with great new ideas and lose focus on the very thing that your customers love you for.

Every now and then I’ll still run through the following questions: what’s actually important in this business? What really matters to our customers?”

‘THERE IS NOT A TEAM IN THE WORLD THAT’S PERFECT. ARTICULATE WHAT IS MISSING’ 3

… BUT DON’T OVERREHEARSE THE PITCH

“During a presentation I’m trying to understand the individual as well as the business. If you’ve over-rehearsed, there is a barrier between us – it’s like there’s an actor in front of me. Rehearsing is good, but learning a pitch to perfection is a danger, because you might get lost if I were to ask you a question requiring you to go off the script. That’s not a good signal to me. I’d much rather deal with someone who knows their business so well that, no matter what I ask them, they will know the answer.”

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REMOVE THE BARRIERS TO TALENT

“One of the dominant reasons for the gender pay gap is the lack of women in the most senior positions in organisations. To tackle that issue you first need to identify its cause by considering the following questions: are women being overlooked or under-promoted? Does your organisation encourage women to be confident and ambitious?

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Does it use gender-biased language or imagery either at recruitment stage or beyond it? Does it offer sponsorship programmes whereby a senior sponsor will champion a talented individual of any gender?

Identifying the cause and removing it will help you to fill your organisation with the most talented people, because talent has no gender bias.”

BE HONEST ABOUT YO U R W E A K N E S S E S

“There is not a team in the world that’s perfect. I want you to articulate what is missing. When people answer a question about their shortcomings by telling me a fake fault – for instance, ‘I work too hard’ – that is a turn-off and it’s disrespectful to the investor.”

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B E WA R E O F A S K I N G A L O T O F YO U R BACKERS TOO SOON

HARRY BORDEN / CONTOUR BY GETTY IMAGES

WAY O F T H E D R A G O N

DEBORAH MEADEN

“People often want contacts. They want me to pick up the phone, call the CEO of Asda, say, and ask him to stock their product. I could do that, but I haven’t spent this long building my reputation just to ruin it because I’ve introduced someone who’s not ready to put their product into Asda. I’m not going to make those introductions if I can’t see the roadmap, the shape of the business or the people needed to get it there.”

As a long-standing IoD member, Meaden is familiar with the corridors of 116 Pall Mall

THE MOST MEMORABLE PITCH I’VE SEEN

“A fantastic guy called Jordan Daykin came into Dragons’ Den in 2014 at the age of 18. His pitch failed spectacularly in the first 30 seconds, because [my fellow dragon] Peter Jones pulled away the radiator that Jordan had just attached to a wall with his product, the world’s strongest plasterboard fixing.

Most of the dragons pulled out of the investment, but he was able to show me that the fixing was sound – it was the damp plasterboard that was the problem.

I made an offer and Jordan accepted it.

His business, GripIt Fixings, is now worth about £20m.”

Deborah Meaden is a member of IoD South West

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DEBORAH MEADEN

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H AV E A N E X I T P L A N T H AT ’ S A D A P TA B L E

“I’m surprised when the question of exit strategies catches people out. You always need to know your current strategy.

I say ‘current’ because it can change, of course, and you’re not always in control.

I wasn’t ready to exit Weststar Holidays but the market was – and I spotted that moment. When I ask people how long they’re in this for, a lot of them haven’t thought about it. Put on the spot, they’ll often say ‘five years’. But why five years?

What will happen in five years’ time that means you’ll go then? It’s about why, where, how and whether it’s feasible.”

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T R U S T YO U R G U T O N ISSUES OF EQUITY

“The Weststar offer was such a good one [Meaden kept a 23 per cent stake after the sale] that the deal felt right.

I get asked a lot about valuations and how much equity one should retain.

You have to go with what you feel is right. If I were to say: ‘I want half of your business,’ how would that make you feel? I can’t answer such a question for you, because there are no rules.

Ultimately, it’s your business – you can and must trust your intuition.”

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D I S R EGA R D P EO P L E WHO DON’T SEE YO U R C A P A B I L I T I E S

“It’s amazing how effective it is to simply ignore an issue. That’s not to say I’m dismissing [issues such as sexism], because there clearly is a problem there.

But if I’m aware that someone has an issue with me I simply don’t give it any time. When you do that, you see a power shift in your favour. This goes beyond gender. If you genuinely can’t do something, that’s life. But don’t ever let anyone tell you that you can’t achieve something that you know you can do.”

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D O N ’ T WA S T E T I M E LOOKING BACK

“I don’t see life as a series of successes or failures because I’ve learnt that the things that seem immensely important at the time – both good and bad – last about 30 seconds. My first business was a complete failure, but I don’t carry that around. At the time I just thought: ‘I don’t like the feeling of that; I’m not doing that again.’ It’s not something that I pull out and look at now. That’s the mark of an entrepreneur, I think.

A constant drive forward stops me from marking the successes or failures.”

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MY ROLE MODELS

“The entrepreneurs who inspire me the most aren’t necessarily well-known people.

Every day I meet new people, see behaviour that I think is brilliant and take note of it.

When discussing role models, people often want me to reach for a famous name – they want to hear ‘Richard Branson’. No, the really amazing stuff happens under the radar. It comes from people just getting on with it and being bloody brilliant.”

W H AT I WA N T F R O M THE GOVERNMENT

“Sort out the UK’s connectivity. Brilliance isn’t geographic.

Cornwall, Fife – it doesn’t matter where you are. I cannot believe that we don’t have better broadband in the regions. Poor connectivity forces brilliance into hubs when it should be spread throughout the whole country.”

ENCOURAGE YOUNG ENTREPRENEURS

Meaden’s co-stars in the current series of Dragons’ Den are Touker Suleyman, Jenny Campbell, Tej Lalvani and Peter Jones 24 director.co.uk

“It’s too late to start nurturing entrepreneurialism among people aged 18. I was seven when I first wanted to start a business. I had nowhere to go with that at school. In fact, I was clearly guided away from it. Government and business have a responsibility

here, because I’m not sure that the curriculum is fit for purpose. It could be more reflective of the new world, the fast pace of business and the need for adaptability.

By the time kids leave school the world has moved on, which concerns me.”

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PUT GOVERNANCE AT T H E H E A R T O F W H AT YO U ’ R E D O I N G

“Corporate governance too often feels like a set of rules and guidelines put together by someone else and handed to people in an organisation – a necessary evil instead of something to embrace, feel proud of and engage with in a proactive, rather than a tick-box, way.

The strands of good corporate governance are fairness, responsibility, accountability and transparency, but the key to really making it work for all stakeholders is communication about the spirit and intent of each strand.

Knowing what you have to do to comply simply isn’t enough; you have to understand why it matters beyond the legal and protection aspects. Using it to frame the type of organisation you want to be, what you care about and how you want to be viewed – that’s great corporate governance in action.”

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K E E P G AT H E R I N G KNOWLEDGE

“I want to know a lot about a lot of markets. No matter what’s happening, I talk to a lot of people – it’s rare that one person has it all wrapped up.

Doing this builds up my toolbox and helps me to make better judgements.

Gathering knowledge all the time is so powerful. I ensure that I stay interested and engaged so I can retain it.”

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SCENARIO PLAN F O R U N C E R TA I N TIMES SUCH AS BREXIT

“A lot of people say: ‘We voted out, so just deal with it.’ But my comment is: ‘How can we deal with it when we don’t know what “it” is?’ Entrepreneurs are used to adapting to change, but we need some idea of what to expect – and we don’t in the case of Brexit. Every organisation needs to think about scenarios. What I’m doing across all of my businesses is getting Brexit on the agenda and asking: ‘What are our risk areas? Are we going to face a skills shortage? Are we going to have problems in our current export markets?

And what about importing?’ I meet too many businesses that aren’t thinking about what they can actually control or doing anything to prepare themselves.”

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GO FOR IT “Our culture creates a fear of failure. Trust me: I don’t like failing, but I’m not afraid of it – that’s two different things. In life you’ve just got to get more right than you get wrong.

The fear of failure stops people from starting in

the first place. It’s the difference between the people on their sofas watching Dragons’ Den and saying: ‘I’ve got a brilliant idea,’ and the ones actually in front of us who’ve put themselves out there and gone for it.” director.co.uk 25