Lord Alan Sugar: I only take risks in things I understand
Lord Sugar on why entrepreneurs should stick with what they know, tell it how it is, and make sure they can sleep at night
In part three of our coverage of Lord Sugar’s appearance at Business 2012, the inimitable entrepreneur explains his attitude towards risk, why business owners can’t afford to beat around the bush, and reveals his little known, but crucial, role in the creation of Sky TV.
What is the business you’d most like to be remembered for?
Most people don’t realise this but Sky Television was brought about by me not far from here in Wapping. Rupert Murdoch said to me he wanted to launch a satellite business and nobody else was interested in manufacturing the kit. The deal was on the back of a fag packet. No contract. I would manufacture the kit and sell for £199 and he would create the channels for it. Christopher Wren might be remembered for St Paul’s Cathedral. I might be remembered for the dishes on the back of people’s walls.
Also, making the computer for every man in the street. Computers cost £2,000 at the time. What I did was bring the PC down to affordable price of £399.
Is there a point when you stop growing your business and decide you’ve got enough?
It very much depends on you. I made my first couple of million quid in 1981 or whatever it was. Some people might say ‘that’s it’. But when you get that feeling of satisfaction you want to do more. A footballer only has a short career. A business person can carry on and do more and more and more. It’s what you want in life – work-life balance, work-social-life balance.
Are there essential qualities of entrepreneurs?
My ethos really is you must be honest, straightforward, don’t beat around the bush, tell it how it is. It might not be what people want to hear, but in the end they’ll respect it. Fly-by-nights are exactly what they are – they don’t last. Opportunists don’t last. You have to have morals and self-discipline and put your head on your pillow at night and think ‘I’m happy with myself’. And that’s important.
I’ve got a small business. Sometimes people choose when they want to pay, despite terms and conditions. Where else can I go for help?
You need to chase for your money. There’s no fast-track solution. Or you need to employ somebody whose sole purpose in life is to chase the money. Or if they don’t pay the money, they’re not worth doing business with.
What has been your rationale for taking risks?
Taking risks in things I understand. Once I amassed my wealth and needed to diversify from the core business and that wealth, that’s when I became a cautious person. You can lose things as quickly as you made them. Stick to what you know. Business is a risk. There’s no such thing as the Harvard Business School module where you open the book and by page five you’ve got a successful business. The world is not waiting for you out there. There are millions of people out there.
How important is a good relationship to be good in business?
It’s important for a business man or woman to have a good stable home life. I think the two things are totally different. An unstable home life is not helpful. You need a clear head to go out and do your business. One of the things that gives you a clear head is a good, happy, home life. If you don’t have that, concentrate on the business alone.
Lord Sugar was speaking at Business 2012 at London’s O2 Arena