Excerpts of Richard’s new book were printed every Monday in City AM newspaper and can now be found here as blog posts.
Posted on June 14, 2013 | in Confessions of a Serial Entrepreneur | by Richard
Years ago, a world-renowned musician took a yellow cab back to his New York hotel, carefully placing his 18th century cello in the boot. When he arrived he grabbed a receipt from the driver and happily hopped out. It was soon later that he realised that he had accidentally left the multi million-dollar Stradivarius behind. Fortunately he had the receipt and with the help of hotel staff and the police, the driver was contacted and the instrument was returned to him several hours later. The musician was of course, delighted, and the feel-good result was worldwide news. Reading about this though, I was amused and perplexed. His comment was “Thankfully, I’d taken the taxi receipt. Always take the receipt.” Wow, I thought, if you hadn’t have been so obsessed remembering your bloody receipt for a few dollars; you might have managed to remember the priceless bloody cello sitting in the boot!
For me, he cited the wrong message. Similarly, when Princess Diana died, all the news was naturally about her and her family, and speculation about who was at fault. But in the overwhelming mass of press coverage, I noticed, almost in the small print, that she and her boyfriend hadn’t been wearing seat belts. I was amazed that anyone could sit in the back of a car, apparently swerving left and right at over 100 mph, without belting up. The fact that the bodyguard survived, sitting in the more dangerous front passenger seat, but wearing a seatbelt, made me think the lesson was obvious: a major factor in Diana’s death was her failure to wear the seatbelt. Any conspiracy theory about her death has to explain how the perpetrator knew in advance that she wouldn’t buckle up. An opportunity was also missed by safety campaigners to really bring home the message that if a princess can die not wearing a seatbelt, so can you.
In business, and in life, I think there are two, very common, flawed approaches: the emphasis on winners, and the neglect of randomness. The world is awash with books and other information about successful people, and the message is that you can learn from them and imitate them. I myself am very cautious. As a parallel, if you analyse the winner of the lottery, you learn the technique is to buy a ticket and wait to win the prize. This rarely works (sadly), but we only know about that because we know there is a huge amount of losers.
So in business, I want to know how and where money is being lost as well as made, otherwise I cannot really know what is a genuinely successful, high-probability behaviour or sector. Perhaps behaviour such as being aggressive (like Steve Jobs) or slightly eccentric (like Richard Branson not wearing shoes) or coming from a deprived background (like many entrepreneurs, including me) actually causes far more failures than successes.
Similarly, high profile sectors may not have a good win-loss ratio. Smart-phone apps and social media websites are all the rage at the moment and remind me of a gold rush. I baulk at getting involved though, because with the high number of quiet failures, the chance of success may be poor – even worse than the odds in the lottery!
The role of randomness is also misunderstood. Why? Successful entrepreneurs prefer to dwell on their talent, and luck is almost a dirty word. However I see very few successes where skill and hard work were not matched by a dose of good fortune. The real lesson should be to plan for a range of possibilities, especially bad luck. Watch the spending and make sure you’re cashed up, even if you’re diluted by fund-raising. And in a car chase, put on your seatbelt.
Would love to discuss patentability issues with you. Can be contacted through my email. Looking forward to a chat and guidance I have a degree in applied science from Monash and I am an electrical engineer which means I have done my due diligence on these inventions and I am wanting to harness the ideas for my own edification and somewhere I know that these inventions (using solar energy)will be dealt with appropriately
By Gerald Thomas
By Are Terjesen