Duncan Bannatyne: The Bannatyne Group & Dragons’ Den
The Den's wealthiest Dragon on success, his altruistic plans and why he'll never retire
“I am not a very good manager. I get distracted easily and want to move on to do other things,” says Duncan Bannatyne, when I ask him where his weaknesses lie. He's not the first entrepreneur to admit to exactly the same failings that you might have yourself. In fact, you may discover that you share a lot in common with Bannatyne. He has many of the characteristics of a Branson or Sugar. He's restless, direct, brutally honest and thoroughly determined – the archetype of an entrepreneur.
The fact that his is the classic rags-to-riches story does this image of him no harm either. Here's the boy from a hard council estate who grew up to become one of the nation's best known entrepreneurs, who can now count the prime minister as one of his friends.
“I think if you look at the really successful entrepreneurs, there a lot more of them with no qualifications than there are those with a string of GCSEs,” he says, suggesting that there will always be more ‘boy done good' tales to be told.
The Bannatyne story is well known and won't be re-told in full here. For those of you who don't know it, here's a summary. After several wasted years and a stint in the navy, he bought an ice cream van which he turned into a fleet and later sold. His next business was in the care home sector, where again he sold out and made a fortune. Since then he has moved into health clubs and, more recently, started casino and hotel businesses. But, of course, we all know him for his time on Dragons' Den, and he is currently recording another series.
Watching Bannatyne on Dragons' Den could leave you with the impression that he is a cold-blooded, ruthless capitalist, with a streak of ice running down his backbone. In reality, he is warmer, polite, but still direct and to the point. His TV persona also belies the fact that he spends a considerable amount of time and money on charitable causes. But, like many entrepreneurial philanthropists before him, Bannatyne is a very hands-on contributor, impatient for results and wanting direct involvement. “I no longer feel good about sending big cheques to charities. I want to be able to see what's happening,” he says.
Bannatyne began working with UNICEF in the early 1990s and is an Honorary Fellow to this day. But after visiting Romania and seeing the appalling conditions in which the poorest children lived, he wanted to offer direct help – something UNICEF doesn't provide. This led to the creation of Casa Bannatyne in 2004, an orphanage that looks after about 20 children with AIDS or HIV and costs him about £30,000 per year. “It's not that much,” he remarks, “but without it they wouldn't be alive.”
Direct involvement and a fast turnaround is a key characteristic of Bannatyne's approach. He became involved with Sir Richard Branson, and together they formed Entrepreneurs Unite, with the intention of doing work in Africa. However, he has already pulled out.
“We were planning on going to Africa and seeing how business skills could benefit people out there,” he says, “but it was moving too slowly for me, so I am no longer involved.”
Bannatyne is determined that his own children won't be spoiled by his vast personal fortune (£310m, according to The Sunday Times Rich List). He plans to have little money left by the time he dies and has recently set up a trust fund to handle his charitable work.
“I think it has become quite obvious to a lot of entrepreneurs that it's not a good idea to leave everything to your children. They end up having no drive or ambition and don't do anything.”
I suggest that Paris Hilton might be an inspiration for this particular thesis, but Bannatyne isn't playing ball. “I'm not naming any names,” he laughs.
He has set up a trust fund for his children. However, he is determined that they will not get a penny from him unless they demonstrate that they have sufficient moral fibre to justify any inheritance, and this includes not smoking. “Sometimes they complain and say: ‘You're forbidding me from smoking,' but I am not. If they want to smoke, they can, but they'll not get their trust fund.”
Bannatyne's hatred of smoking is well known. He gave up the devil's weed 30 years ago, which he says was terribly hard, and has remained a hardcore anti-smoker ever since. His dislike of smoking has led him into another project, which combines some of his passions. “Close to the school I support in Malawi, you'll find these stalls where they are selling cigarettes – singles not in boxes,” he explains. “They do this to get children to buy them. I think single cigarette sales should be banned.”
This will be included in a “hard-hitting and high-profile” documentary currently being filmed for BBC World. The film will see Bannatyne pitted against the giants of the tobacco industry, such as British American Tobacco. It is a battle that Bannatyne is clearly relishing.
These days, Bannatyne doesn't spend a huge amount of time working on his business, and has handed over its day-to-day running to others. He reckons he will be in the office for about three days this month, although he is a fan of the BlackBerry.
“I would say one of my main strengths is a great ability to delegate and to be able to motivate people to work for me,” he says. “I spend very little time in the office now.”
The Bannatyne group is run by managing director Nigel Armstrong, who Bannatyne describes as very dedicated and hard working. “He runs the business 24/7,” says Bannatyne. “He was working for me as a financial controller. There were others in the company who had more health-club skills, but they didn't work as hard and fell by the wayside.”
Bannatyne also says that theirs is a strong company culture and that this is important because his profile means the business comes under greater scrutiny than others.
“Staff have got to want to work for you and they need to be motivated to serve customers,” he says. “If they are just coming for the money then it's not going to happen.
“We have never done the stated values thing. Every gym has my picture on the wall and my contact details are there. If there are problems, and there always are in any business, then I will find out, and then I can get on to them.”
In the den
Along with Peter Jones, Bannatyne has been with Dragons' Den since the first series – there have been nine Dragons in total. The next series is currently being filmed and apparently there are now fewer disagreements between the Dragons. “We are definitely getting on better than we used to. I am a bit worried that it might mean the programme isn't as good,” he jokes.
The hostile atmosphere is criticised by some, not least by one former Dragon, Simon Woodroffe. Bannatyne doesn't waste much time in dismissing his comments. “It's easy to say that when you've been fired from the show,” he says. “Yes, it is confrontational, but a lot of the time this can help people, because they will realise that they shouldn't do that in business. If it wasn't confrontational sometimes, who would want to watch it?”
He also argues that the cool demeanour of the Dragons is largely down to editing. “The one person whose image is really portrayed badly is Deborah Meaden,” he says. “She comes across as really hard in the show, but in reality she's lovely, always joking and laughing.”
Bannatyne has spent most of his adult life as a relative unknown, but after several years of primetime TV he is now a household name. He is comfortable with being recognised in the street and being asked for autographs, and says there are major advantages.
“I wouldn't have wanted to be famous if I was poor,” he says. “Myself and the other Dragons don't call it fame, we call it profile. It's profile for the businesses that we have created. It is very different from someone who becomes famous because they are a TV presenter.”
Bannatyne's profile appears to have been a major factor in the growth of his health club business. In 2006, he made a major acquisition from Hilton International, buying 24 health clubs for close to £90m, and turning Bannatyne Fitness into a major UK business.
“I never would have got to speak to those people if it hadn't been for my TV profile,” he says. “It would have been: ‘There's some bloke called Ballatyne from Scotland on the phone who wants to buy.' I wouldn't have even been put through.”
Fame appears to work on the finance front, too. “I needed a £90m deal, which the banks wouldn't have done in ordinary circumstances, but because of who I am I was able to get it.”
At 58, the passion is still burning in this Dragon and he intends to work until he drops. “I am never going to retire,” he says. “Why should I give up the life I love so much?”
Once again, the restless entrepreneurial archetype shines through. I suggest he might fancy a slower pace of life, perhaps time to work on that handicap. “Golf?” he scoffs, “I can't think of anything worse than playing that stupid fucking game!”
It is clear that there's fire still burning in this ol' Dragon – and it won't be going out any time soon.