I've only once reviewed a book by a friend and, having innocently stirred a couple of mildly critical spoonfuls into a large cup of praise, I instantly fell off his Christmas card list. But, as minefields go, being asked to review a book by another MT contributor is even more richly stocked with hidden explosives. Recommend it, and you look as if you've sold out; slag it off, and expect to wake up with a horse's head for company. So, before reading a word, I found myself plotting a strategy. If it was crap, I'd feign illness and fling the hospital pass on to some other unfortunate. If it was decent, I'd say so, but craftily use language restrained enough to hint that my enthusiasm had limits. Thus armed with a plan, I opened the front cover - and didn't stop till I closed the back one. If you're interested in doing a start-up or buying an enterprise - as opposed to dry theories of entrepreneurship - just buy this book, OK?
I could stop there, but I guess I'd better explain. Johnson beats most management writers hollow because he can actually write: the style is direct, unstuffy, conversational. And he doesn't mess around in the content either. There is zero padding, just dollops of acute observation and dirty-fingernailed practical advice. He offers a brisk rundown of sources of finance - banks, VCs, private equity, angels (with the warmest words for the last of these). He warns against considering only a true start-up, pointing out that acquiring a company is often a safer bet. He suggests having partners, who can share the burden as well as the glory or misery, may be wiser than flying solo. He's dubious about the need for entrepreneurs to be all-rounders, convinced that one or two remarkable talents may carry someone to the top in spite of significant shortcomings. He is drawn magnetically to change - innovation, challenge to the status quo, calculated risk-taking - and repelled by the inertia and dead weight of complacency, bureaucracy and regulation. His most impassioned advice is never, ever offer any form of personal guarantee, especially putting your own house on the line.
Timing? Johnson thinks there is no such thing as a bad time to start a company, that shifts in the economic weather simply offer different issues and opportunities. When cold winds blow, it may be harder to find finance or customers, but assets will be far cheaper. Unsurprisingly, in this and many other matters he draws on the world of restaurants, which has formed the primary focus of his investments, pointing out that, even when punters are feeling the pinch, they will still want to go out and have a bite and glass, if only to relieve their gloom.
I recall this from when I was a non-exec of Groupe Chez Gerard. As the economy slumped, we feared Armageddon, but our business held up surprisingly well. However, as soon as it started to recover, our restaurants mysteriously emptied. Once customers realised they could again start saving for that new house or car, they wanted to save on non-essentials, like steak and chips.
The corporate wheel spins ever faster, which makes it trickier to distribute brickbats and bouquets. Johnson excoriates Royal Mail and BA for being run primarily for the staff, and praises John Lewis. I would have agreed with at least the first and last of these comments until the John Lewis online shop comically bungled an order of mine and then responded to the problem in a pure 'Am I bovvered?' fashion. Apparently, this was far from an isolated experience.
Naturally, the heart of the book is about what makes an entrepreneur. He sees their most important characteristic as an ability to take decisions and therefore what he terms 'a bias for action'. He adds: 'They are not the same as other people. They have an ambition, a competitive urge and a lust to take risks that is way beyond the norm.'
That being so, it seems surprising that, having rehearsed the nature versus nurture arguments, Johnson comes down firmly on the side of nurture, believing the key ingredients emerge from a mix of hands-on experience, hard work and what entrepreneurs learned at their parents' feet. I reckon you need both nature and nurture. You'll never become a Djokovic or Vettel without putting the hours in, but if you're born without exceptional co-ordination and lightning reflexes, the silverware will always elude you. I don't think I've ever met a serial entrepreneur who wasn't already flogging, trading or running something while he was still in shortish pants. Johnson fits that bill precisely, having figured out at 18 a capital-free way to run lucrative events at a club.
This is a must-read for aspiring entrepreneurs, probably the best book available on the subject.
So there should be no chance of my falling off Luke Johnson's Christmas list. But only because I'm not on it - we've never met.
Start It Up: Why running your own business is easier than you think
Portfolio Penguin £12.99
- John McLaren is chairman of the Barchester Group