"Cash. Always cash. The power of money" - A business lesson from Tony Pidgley

The founder and chairman of Berkeley Group on the importance of a healthy balance sheet.

by Adam Gale
Last Updated: 26 Feb 2019

The explosive rise of so many technology companies over the past few decades has created a somewhat warped sense of what business success looks like. All too many of the entrepreneurs we encounter advertise their credentials on the basis of funds raised, big-league investors engaged and, above all, topline growth.

That’s in striking contrast to the attitude we see in more established (and successful) founders, regardless of sector, which can be neatly summarised in the old adage ‘revenue is vanity, profit is sanity, cash is reality’.

It’s a belief that’s served Tony Pidgley well. From starting his first business in his teens, Pidgley has grown housebuilder Berkeley Group from a fledgling into a FTSE 100 stalwart, a record of sustained success that he puts down in part to never taking his eye off the balance sheet.


"We’ve always run Berkeley on its own cash. That’s why I like being a public company. It enabled us to raise capital in an easy way. That diluted my own share position, but it gave me great confidence in deal making.

"I can sit in the room with the cash we’ve got – and that’s public knowledge – and say ‘I fancy that piece of dirt, I’ll give you this for it’. I can write a cheque and buy it today; the other guy couldn’t . We don’t have to run off to the banks, we use the balance sheet, and that gives us an edge. In our business people want certainty – and I’ve always known that.

 "Remember, I grew up in a society where we horse traded, where it was always cash. I take the money out of my pocket and say ‘I’ll give you £25 for that horse today, here it is, money in the hand’. We shake on it, smack the money down and it’s done. Cash. Always cash. The power of money."

Further reading

Image credit: Berkeley Group

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