THE ANDREW DAVIDSON INTERVIEW MAGAZINE JOURNALIST OF THE YEAR: Sir Alan Sugar - The beard, the grumpiness, the grudges - the tough-talking founder of Amstrad comes with a reputation. But he saved both Spurs and the Hackney Empire out of sentiment, he stic

THE ANDREW DAVIDSON INTERVIEW MAGAZINE JOURNALIST OF THE YEAR: Sir Alan Sugar - The beard, the grumpiness, the grudges - the tough-talking founder of Amstrad comes with a reputation. But he saved both Spurs and the Hackney Empire out of sentiment, he stic

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Last Updated: 31 Aug 2010

Sir Alan Sugar steps into the foyer of his West End apartment block. He is shorter than I expect, neater - spotless pinstripe suit, precision-trimmed beard and hair - and shyer. We are introduced, he shakes hands sparingly, never makes eye contact, barely looks up. The lift takes us to the sixth floor, a vast penthouse duplex overlooking Green Park, and he mumbles: See you later, I'll be upstairs, you can wait.

Right. If I didn't know his middle name was Michael, as in Alan Michael Sugar Trading (Amstrad), I'd know for certain it was Gruff.

That's the man's image, and he likes to live up to it. Spend around 15 minutes in his presence and you are quickly reduced to the role of timid flunky, hoping to catch his eye (unlikely), worrying that you may be displeasing him, trying to avoid the verbal bollocking that, when we finally got round to talking, he started giving his Amstrad e-mailer.

'Shit!' he shouts. 'The f***ing phone's gone blue-screen again! Are you serious? It's unbelievable! Unbelievable!'

When he is not expressing exasperation, he gives off the kind of silent, simmering discontent that can easily be misread as contempt. In the two hours I was around him I didn't see him smile once. Not once. No wonder he has a reputation as a tough man to work for. Rarely have I met a boss who is so ungiving.

Which is a shame, because he's no fool. At 54, he has already built a pounds 500 million-plus personal fortune out of his ability to buy and sell brilliantly: hi-fis, computers, satellite boxes. He has a genius for spotting what consumers want and knows how to get it to them at a price. And when he allows himself to be, he is a funny, perspicacious commentator on the British business scene. He's famously corruscating about both the duplicity of City advisers and the venality of ad agencies, to name just two targets.

But most of all, he's good at making money. He called the tech stock crash years before it happened, he was quietly piling into property before people recognised it was an adroit switch - the Mayfair duplex we are in, for example, is not his home (he would never, say his friends, live in somewhere as flash as that), just a block he is doing up and selling.

The enormous penthouse, in which we sit, is on the market for pounds 8.5 million - bit beyond my budget. It's also more than Sugar paid for the whole building.

It even looks like he is getting out of Tottenham Hotspur, the football club with which he has been entwined for nearly a decade, with more money than he started. That would be a first for many football club chairmen.

Of course, he cannot crow about it. 'It will alienate people,' he says gravely, as if he cares. But the facts are there: paid pounds 8 million for his stake, sold two-thirds of it to Tottenham's new owner ENIC for pounds 22 million, still holds 13%. We met on the day before ENIC disposed of George Graham, Sugar's controversial pick as Spurs manager, so who knows what he thought of that? I cannot believe it was done without his tacit approval - who would dare? - nor that Sugar isn't just as exasperated with the underachieving Graham as he is with the rest of the soccer world he's always ranting about: overpaid players, grasping agents, lying press, moaning fans.

Imagine my surprise, then, when Sugar tells me he's mellowed.

'Yeah, I've mellowed,' he says, 'definitely, no question of it.' Hence the efforts 'to put something back' in recent years. He's been lecturing to students about entrepreneurialism, at the Government's request - picture that 10 years ago - and handing out money to good causes: pounds 1.3 million of his Spurs cash to the Hackney Empire theatre recently This from a man not noted for his interest in the cultural scene. It was roots, he says. He's Hackney born and bred, he used to buy fish and chips next door to the Empire.

He speaks quickly, economically, his growling East End rasp now softened with age. Or perhaps it's all that putting-about he's doing. Knighthood, Buckingham Palace, Downing Street functions, those lecture tours. If I was a little cynical I would think there is a bit of remodelling going on here, not entirely unconnected with the fact that Sugar's second biggest company, Learning Technology, part of Viglen plc, is now the largest supplier of computer equipment to schools ...

It's the sort of hint that could get you a swipe from some interviewees, but Sugar likes to get as good as he gives. 'Ha!' he shouts. 'If only it were that simple!' No, he's not cosying up to Government, he just wants to encourage entrepreneurialism, he thinks we are good at it and he knows it provides people with a way out.

Really? He says he's always surprised by what people read into his actions.

Trying to take Amstrad private in 1992 was seen by shareholders as getting control on the cheap. (They rejected his plan, he later broke the company up, then renamed another firm Amstrad.) Likewise, buying into Tottenham in 1991 was interpreted as a smart step to get inside a business that Sugar, the satellite dish manufacturer, knew was going to boom. Or was he sent in by Rupert Murdoch to mole the negotiations for TV rights?

'Nah, absolute rubbish,' he says. 'From an ego point of view I would love to say how clever I am, but it's got nothing to do with that.' Buying into Tottenham was about saving the club his dad loved. 'And a lot of the community stuff I do, I don't make a fuss about. I have built schools and old-age homes and supported Great Ormond Street.' (In all, he has donated more than pounds 4.5 million since 1986.)

The truth is, he is so good at making money that people don't believe he could give it away without getting some edge or personal benefit. He's not sure where he got that money-making nous from - not his dad, who was a factory tailor, nor his mum, who stayed at home looking after the family.

Much of his character, though, was formed by his circumstances. His family was poor Jewish immigrant stock, settled in London for three generations, 'from Russia or Poland, somewhere like that'. He was the youngest of four siblings, an afterthought, born a good 12 years after his twin brother and sister and 14 years after another elder sister, all sent off to factory work at an early age. His youth was, he says, 'a lonely existence' and that probably made him mature quicker, and got him used to sorting out his own problems.

And when he was young, growing up in a two-bedroom council flat on a Hackney estate in the 1950s, the biggest problem was money. His father worried constantly about providing for the family. He remembers him switching off every light in an empty room, trying to save cash. So Sugar worked out schemes to make his own money: he collected scrap paper, cleaned cars, sold photographs. And vowed that he would never suffer like his dad. Sugar's early icon was his mother's brother, Uncle John, who ran a hardware store in Victoria.

'He made a bit of money in the war, invested it in property. He was a bit of an early mentor,' says Sugar. Uncle John listened to his nephew's business ideas, encouraged him. His own motivation, adds Sugar, was that Uncle John was the only one in the family with a car, and he was desperate for a set of wheels.

With six O-levels and a bent for science, Sugar left school and worked through a succession of promising white-collar jobs, never satisfied with what was on offer: doing statistics at the Ministry of Education and Science, working in the backroom office of a steel company, signing up as a salesman for a tape recorder company. The myth that portrays Sugar as the archetypal rags-to-riches barrow boy, who started down 'ackney Market, is complete bunkum. He was bright, driven, and knew by the age of 18 that he didn't want a conventional office job - because he had already done them. Selling tape recorders to shops, the job that finally gave him a car, also gave him the confidence to think: I can really do business.

Was he a good salesman? 'Very good, yeah, I'd say.'

Aggressive?

'Nah, it's about being logical, you know? Making offers that was difficult for them to refuse, no-brainers, that's always been my forte, fair value for money, never overselling something.'

In fact, he sold brilliantly, and was furious when the tape recorder firm refused to give him a pay rise. So he moved to another electronics company, before realising that all his new employer was doing was importing and selling on. He could do that himself. 'And that's how I started. I bought some bits and pieces to sell, like car aerials, took pounds 100 out of my savings, bought a minivan second hand for pounds 50, spent another pounds 8 on insurance and the balance on stock and at the end of my first week I'd made pounds 60 just buying and selling to shops. That was it, I felt I could do it by myself.'

By 1968 he had married, set up AMS Trading, later Amstrad, and the rest is history - he built up his empire always using the same principles of value and a good proposition.

But others have tried that. Why has he been so successful? Early days, he says, it was discipline. 'You have to have discipline when you are working for yourself. There's no-one else to report to on a Monday.' And you have got to be good at figures (Sugar's team say he has a phenomenal memory) and be a good salesman.

And have luck? Sugar leans forward, his face squished up like a wrinkled pickled onion.

'There is no luck involved in my business success. I have got to tell you that ... It is a case of smelling the market. You have got to have a nose for certain things.'

And yet it has not always been plain sailing. Sugar, who floated Amstrad in 1980, acknowledges that he has been dogged by a poor reputation in the City, where banks and brokers are notoriously suspicious of his actions.

'That's because I won't play their game,' he shrugs. That game, he explains, is the whole process of briefing analysts in advance of results so a cosy coterie knows what's happening, no surprises. He despises it.

'They've done me a couple of times in my early days and I got streetwise. You get a call from a broker (puts on posh voice): 'I'm phoning with my corporate advice hat on, see how things are going, Alan. Are you in line with the forecast we put out?' I'd say: no actually, we've doubled the profits we thought we'd make. 'Right, byee!' The phone goes down and two hours later our share price starts running away! That's totally unfair!'

Bosses spend more time now schmoozing these types than running businesses and that, he says, is why the market became ludicrously overvalued. 'What annoys me about the last three years is all the smoke-and-mirrors stuff, people talking about dreams. The only people who were making money out of it were the brokers and bankers. The poor individual shareholders who got sucked into this nonsense were the ones who lost.'

But he has good reason for his antagonism, too. As recently as 1996 it was City advisers who, reportedly, stopped hand-held computer giant Psion buying out Amstrad and giving Sugar a nice wodge of cash and shares. Sugar eventually sold off the company bit by bit but it still infuriated him.

He had initially suggested the deal to Psion boss Dr David Potter, and I'd say he hasn't quite forgiven him yet.

He lays into Potter, ending his rant with: 'Actually, my full title is Dr Sugar, you know? Doctor of Science. I am as much of an academic as him, got it back in the 1980s somewhere.'

I think he is joking about the doctor bit, but to be honest, with his face pugged up in grim concentration, it's hard to tell. Some who have done business with Sugar for years say that it's all an act: the beard, the grumpiness, the grudges. Sir Stanley Kalms, chairman of Dixons, calls him a straight-faced comedian. 'He growls and jumps and likes to provoke, but he is 100% focused on what he wants to achieve.' He even sends stinking letters, 'then you ring Alan the next day and it's 'Hi Stanley, how're ya doin'!' and you realise he's forgotten, he just had to get it off his chest.'

Another close to Sugar is not so sure. He says Sugar hates bullshit, always wants to avenge a slight, and trusts only those who have come up the same way as him, with the same values.

Hence the preponderance of men from north and east London, unaffluent backgrounds, second or third generation immigrant, who have formed his executive cadre: Malcolm Miller, former Amstrad MD, now chief executive of Pace Micro (16-year stint), Borden Tkachuk, another ex-Amstrad MD, now CEO of Viglen (13-year stint).

All have the same attributes. 'If you look at the commercial people around Alan, we can all trade, do a deal and make it stick,' says Tkachuk. The house style is aggressively macho, nicknames are commonplace (the salesman who over-promised: Goldenbollocks), Sugar is tough on employees who fail, he demands constant access to his executives - 'when he rings he expects to talk to you' - and he always cuts through any waffle.

Some, like me, are rather intimidated by his refusal to exchange even the smallest of pleasantries before getting down to business. Why doesn't he make the effort? 'Because he doesn't have to,' shrugs Tkachuk. Does he think Sugar has mellowed?

'I haven't noticed it,' he laughs.

A lot of that makes Sugar rather unsuited to certain kinds of business, especially those where emollience and PR assume any importance. Hence his problems talking to the City, likewise running a football club. Tottenham fans hated him for not promising the earth. Any regrets?

'I should have lied regularly every week,' sniffs Sugar, 'about how much money we were going to spend and how we were going to build a big team and do this and that - not do it, of course, but bluff my way through the way most chairmen do. At the end of the day a lot of hot air is talked by people running football clubs. They talk about passion. Cheap words. I can't bring myself to say something if I'm not going to do it.'

And somehow, somewhere, he has never made that final leap to building a really big multinational company. He had the chance with Amstrad word processors - he had a global market in his hands, and he let it slip.

He was sabotaged by the faulty hard drives on a new line but it was more than that.

'Some of it must be people,' says one who has worked with him. 'More of the companies could have moved out internationally. Something went wrong.' Another in the electronics business suggests that, as Sugar is a hands-on boss, expecting him to build a huge multinational is unrealistic.

'Alan can't delegate,' he chuckles. 'The limit of his powers are in the scope of his personal control.'

Sugar holds his hands up and admits he ballsed up. Too tied to the Far East, too slow to innovate. 'We exploded the IT market in England and I think we should have invested far more in technical and engineering people to keep us in the forefront.'

But it's happened again and again. Why did Amstrad let Pace barge into its market for set-top boxes? Why does Sugar never learn? 'Because Alan's strategy is based on blockbuster success,' says one former Amstrad man.

'Put out 10 products and if one is a hit it doesn't matter about the other nine.' Corners cut, focus lost.

Sugar's looking at his watch. I can see I am already losing his interest.

He talks me through his political conversion - he loved Thatcher and Major, but likes Blair even more, because he has really opened things up. 'The Alan Sugars of this world can run public companies, can trade currencies, can be an MP, can be someone,' he says.

You don't have to be some viscount and that's the attraction.'

So when Blair asked if he'd pass on his wisdom and his enthusiasm to the new generation of potential entrepreneurs, he jumped at the chance.

Does he think we make good entrepreneurs?

'Yeah,' says Sugar, 'but you have to recognise who is good at it and who isn't. It's in-built in you, like a musician's or artist's talent.

You can't go into Smith's and buy a book and just become an entrepreneur. You've got to have some killer instinct in you.'

Then he adds: 'People shouldn't be allowed to use the word entrepreneur. It's used too frequently, it should be illegal. I can't call myself a lawyer or a doctor, because I don't have the qualifications.'

Gotcha! You just told me you were a doctor.

Sugar doesn't blink. 'No, you haven't got me. I'm not a medical doctor.

I can do anything else other than hysterectomies,' he says, with a completely straight face.

Are those eyes twinkling? If he was the kind of bloke who laughed, I think he would have laughed then.

Why does he have to be so tough? One rival suggests that, despite all the success, Sugar still has a nagging inferiority complex.

'That's why he behaves so aggressively. He's frightened to have an intellectual conversation but because of his powers of insight he will come to a conclusion and give it to you straight between the eyes.' The strange thing is, he is right most of the time.

And remember, says the same source, Sugar has had a rough time from the press, they have been very critical of his business style. Just two months ago, he won a libel case against the Daily Mail when it accused him of being a miserly football chairman.

He's bound to keep the defences up. Only his old mates, many of whom he's known since his Hackney days, see the true Sugar. 'He is surrounded by a small coterie of very loyal friends into which he nestles and is an entirely different person. He has kept his friends from days of yore and when he moves out he faces an aggressive world.' Hence the act.

The odd thing is, he doesn't even let it drop for those who work with him. He rarely socialises with his key executives, keeps his home life private, and despite the houses in Essex, Florida and Spain, the blue Rolls Royce, the private plane, doesn't like people to think he has an extravagant, 'unrealistic' lifestyle, especially with regards to his children (two sons and a daughter, all grown up now). 'Money could ruin my family but it hasn't, because of the way my wife and I brought our kids up. They have always been made to go to work and be realistic in life. They're not your Ferrari-driving, drug-taking, hippy, yuppy lot,' he sneers.

Anyway, time's up. Sugar ambles off reluctantly to have his picture taken. His last words to me, when he leaves the photo session, are a typically grudging. 'You told me it would only be bloody two minutes!' Then he stomps off up the stairs.

What is wrong with him? I think. Then just as I'm writing him off as a grumpy old bastard, I distinctly hear the hint of a chuckle.

SUGAR IN A MINUTE

1947: Born London, 24 March, educated Brook House School, Hackney

1964: Assistant at Ministry of Science and Education

1968: Sets up Amstrad

1973: Sales break pounds 1 million

1980: Public share offering in Amstrad

1985: Launches PCW 8526 word processor

1989: Moves into satellite receiving equipment with the launch of Sky

1991: Buys into Tottenham Hotspur FC, becomes chairman

1992: Shareholders vote against taking Amstrad private

1994: Acquires Viglen

2000: Knighted in New Year's Honours List

2001: Sells controlling interest in Spurs to ENIC.

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