TheDLOG's real name (it is no secret) is Jason. TheArgo is the sort of nickname someone with the name Jason is likely to pick up. It could be worse, it could have been Donovan...!
It is hard to know why such people come to these events.
It reminded me of academic conferences where the "normal" disingenuous reason for "questions" is to either rubbish the speaker, or blatant promotion of the person asking the question.
As Ali said - That lady got a very hard time from the audience - And it serves her right.
The video doesnt capture the deserved "fire" that came along with the answer from Rachel!!...if looks could kill.
For all that:
I would not dignify such a person by giving her air time on youtube.
She also doesn't understand banking. Banks are not duty-bound to provide loans regardless of what Gordon Brown might think. Banks are there to make money just like any other business and it's entirely up to them to decide whether to loan or not. The only kind of bank that could be duty bound to loan would be a sovereign bank – which Northern Rock effectively is – and look what they've been told to do. But even a sovereign bank could would still turn people away.
I mean – what kind of bank would consider loaning to someone with No Income, No Job and no Assets? Wait a minute...
Stephen I'm sure that if that happened, the 'Bank of England' would do something to upset you, and you would then be blaming the 'Bank of England' for all your woes
I don't think the banks were being underhanded Stephen, although there were certainly unforgivable failings.
As I have stated previously on my blog, my view is that the finger of blame will ultimately be pointed at the hedge fund industry. It was/is completely unregulated and yet in 2007 controlled well in excess of $1trillion worth of assets.
These funds did so well that they believed they could trade anything, so new financial products were devised to satisfy the hedge fund's want – the most sinister of which was debt packages such as swap derivatives where funds would take on debt risk a) without having the cash to pay the debt should they ever need to and b) not even knowing what the potential scale of the debt could be and who untimely owes it. Because hedge funds fundamentally profit from the difference in points between assets, it didn't matter what the assets consisted of, just so long as the assets had a fluctuating price. So hedge funds just wanted big ticket assets that had fluid price ranges and debt packages provided just that.
Finally, along come the big banks a bit late to the party but they want some of the fun. So our banks start behaving like hedge funds and venture into leverage positions that they simply do not understand. What happened is pitiful but it's not sinister as some think - when you have collective idiocy like this, you end up with bubble and burst.
Other than calling RLD a crap idea (not a crap idea, just a 'small' idea in real terms IMHO), the questionner (again not really a heckler IMHO) had some good points.
Rather than put the 'heckler' in her place, however, I thought your defence was utterly Gordon Brownesque (we had ten years of growth, record investment, blah, blah, blah). The end result is the same: BUST. If I recall RLD went belly up before the 'credit crunch' was even termed.
Plenty of material there for all the brown-nosers on this site that ruin what could be a very useful blog.
Not really Anonymous. The questioner was clearly having a go at the banks with no good reason and then threw in the RLD comment for theatre. You simply cannot secure against illiquid assets right now – stop moaning and understand the situation.
Whether RLD was a crap idea or not isn't really the point. Whether it was profitable is the point.
Personally, I'm not impressed with talk of turnover figures. Why Rachel insists on talking about £100m turnover I don't know. Unless I've completely missed something, she's talking about aggregate turnover over 16 years – which doesn't present RLD as anything special.
£1million annual net profit (if it was net profit), is interesting and special if that was achieved consistently given the likely annual turnover figures.
Please remember Cranberry that there are a lot of people who read this blog that actively follow Rachel, as much offline as online. Many of these people have shared a special relationship with her and if you read back through the comments on this blog you will find many of them.
It doesn't take a lot of brains or balls to turn up at a venue with a loaded gun and fire off a few rounds from the back row. But it does take a lot to build quality relationships and that is what Rachel does.
Also, i must take issue with your perspective of success in business. If you were to carefully analyse Rachels contribution you would begin to appreciate just how much it takes to achieve what she has.
I am happy to take this offline if you want help understanding this.
Stephen, my point, which you have chosen to completely overlook, was one about turnover vanity.
Since you are having difficulty understanding this, I will repeat it for you: the size of turnover of a business is not relevant to company matters – profit is – that being net profit which directly adds to the cash held by the business. However, people tend to be impressed with turnover numbers because they are generally the highest - which is why they get banded about so much.
Now in that, is there anything that slates Rachel or RLD? I don't think so. It's an observation of the use of turnover vanity which is extremely common in the business world. Where exactly have I ventured into talking about Rachel's life contribution or achievements? I have not.
This blog is an open forum – anyone can post and contribute. Someone could post an extremely disparaging post about Rachel – that's the nature of the beast. I suspect though, that you would prefer this blog to be a place where people with a special relationship to Rachel cozy up and get all snugly together. If you're not prepared to put up with the varied views posted on this blog then stop reading it or get Rachel to take it offline.
You really need to be less defensive when it come to Rachel – it would appear that you see red at the slightest mention of her name by a non-Stepehn approved contributor. Before you read a post that has the word 'Rachel' in it, slow down, read it again and ask yourself: “is this unnecessarily offensive towards Rachel or is there a valid point in the post's content?”. Only this way, I think, will you stop yourself from firing-off half-cocked.
I have said as much elsewhere on this blog re the turnover vanity, profit sanity argument. Above both of course comes cash, the lack of which was RLD's demise.
To be fair to Stephen though he does have a point. Rachel did develop a niche into a fairly sizeable market. None of my businesses have done this (we are in the better mousetrap category) and as such all are probably limited in potential. Mind you, we are profitable, have no debt and have cash. Maybe mousetraps aren't so bad afterall.
I do not think Rachel has turnover vanity. What she achieved in turnover/profit was only a small part of her overall success story.
Her real (genius) and i do not use this word lightly was in inventing a totally new and innovative marketplace - (in effect - the experiences sector). I'd say 99.9% of entrepreneurs either operate as (same old, same old) or as (leveragers of existing markets).
What Rachel achieved was to start with a blank sheet of paper and invent an entirely new marketplace from the backroom of her home. From that one marketplace others have developed new businesses and products and more.
What she saw and built was a totally new way of thinking. A new paradigm in recreation.
This is not unlike the vision of Bill Gates and his vision for a PC on every desk.
She may of course never achieve this standard again, but people need to look at what she achieved from more than one dimension and perhaps stop measuring these types of people by their own narrow standards.
High achievers are successful in many different areas of their life and business - not just one.
Listen very carefully, I shall say zees only once...
I am not in the business of knocking Rachel. I have absolute respect for what she has and, continues, to achieve. Having said that, does that mean that she or her dedicated followers are not open to questioning?
What is the benefit of stating a turnover figure that represents 16 years worth of trade? In my book it serves nothing unless you are impressed by such a figure or somehow construe that this represents just one year's trade?
That is my point and it does not detract from everything good that Rachel does. It is merely an observation and worthy of questioning.
This blog could be so much more interesting if certain people would stop taking anything that is not positively gushy as a personal attack against them or Rachel.
I suspect she quotes this kind of stuff because it is evidence of past business performance, rather than quoting the intangibles of her success. But remember RLD was only part of her portfolio.
Many people wouldn't understand what it takes to achieve what she did.
A lot of the people i talk to tell me that they are self-made millionaires, but when you look closer, their success can be attributed to chance or to the sacrifice of others. And then when you look at where they made their money - took absolutely no innovation at all.
There are very few who can engineer and still fewer build a consumer marketplace.
From Zero to Hero.
We need more Rachels now and fewer hecklers. The country needs to create more capacity for kick-starting growth. We cannot acheive this if we don't back the right people. The make or break will be whether we can recognise the right attributes and talent in our leaders and support them - or if we are just going to use the same old ways of measuring potential- which has effectively lead the country to get into this mess.
I am sure had Rachel had the time to respond to the heckler further, she would have expanded on explaining her successes more fully.
But then i'm not sure whether the heckler would have been able to grasp it - given she is so unconfident about being an entrepreneur as to keep a day job!
The Idea for RLD isnt crap and there is still companies operating similar and so is RLD.
But good luck for the future, and i asked cranberry to speak to me I have since decided not to I feel you are a waste of my time, and I see you have sold one of your businesses and one is sufferring?? That is a shame isnt it, well do a SWOT analysis followed by a SMART Analysis - you may be re guided?
Who knows I am a Trained (almost licenced) Insolvency advisour.......
Personally, i don't have a problem with hecklers. I just think they should pick the right targets.
There are just so many targets out there and there are £10trillion reasons why. Recession is the rich mans way of saying.......Well time to tax the poor more...in order for us to can hide more.
Yep, I agree with Stephen, get yourselves together and see if you can't sort something out, don't let the company go down, get help, what ever is offered take it, you never know what little piece of advice you may have missed Cranberry, and 2009 make that contact.
I didn't mean to be harsh to cranberry Stephen, but I don't have time to do Skipe or MSN..
But yes I would advise to take heed, and I am sure it will make a positive result for you and there is much more to it, you want the help you make the request for my help and I shall. (For free) - Do you realise my advise would cost you god knows what in countless "Business rescue packages" I am 28 and i have made a lot of money and I believe in sharing advise I DO NOT HEED FAILURE of any kind!
And the words "Theese things happen" "I lost control" "I put somebody else in charge of the finances" - All theese to me say one thing and that is "WEAK"
Stephen, Dlog I appreciate your concern - I'm lucky enough to have a decent team of people around me, in whom I have great faith - and we're still here which I would not have put money on six weeks ago.
I'm fiercely tenacious and have had both business success and failure so you can rest assured that I can see both sides of the coin, and will not go down without a fight - but sometimes business goes beyond first term MBA analyses.
You'll forgive me if I don't buy 2009's rhetoric. I've taken the time to go through past posts and what he has written does not indicate any significant level of experience, expertise or insight (although I did see that C had mentioned the whole profit, turnover vanity issue previously, so I apologise for bringing that up again).
Maybe I'm looking a gift-horse in the mouth? I suspect I'm not. I don't think he's genuine. You would have thought that someone who's an advisor by profession would know how to spell the word.
I was given a horse once and despite the obvious temptation...
Anyway, don't go knocking MBAs, it kept me in a job once but I have to agree that in business it's as much use as the aforementioned horse.
Cranberry is right though. In my experience, anyone who professes to be working in an area of English law really needs to have a rudimentary knowledge of English. Latin helps too plus a good line in bullshit as most lawyers seem fluent in that.
What exactly is your business Cranberry? Interesting how everyone has rushed to help when in fact you might be an arms dealer, pushing drugs on children or worst of all a banker...! (Ok I know I was one of those once but I have changed honest!)
C, doubt he would be in trouble if he was an arms dealer/drug pusher.
Seriously though Cranberry, sometimes talking to anyone, academically educated or just street wise can bring an answer that you need. When we feel under pressure we can sometimes miss the most simplest of things that would otherwise be brought to attention by somebody else, ie; 2009.
It sure was a cheap shot… RLD’s wasn’t a crap idea; otherwise it wouldn’t have been a business at all.
Unfortunately Rachel, like some people, who are famous for being famous… whether you like it or not, you’re famous (or infamous to some negative people) for being a “business failure”. Your book, Business Night just adds to this public persona, whether people have read you book or not.
It’s this ‘fame’, which gives people an uneducated excuse to heckle you publicly. I’m sure most people who run a business would have more respect.
C, I'm fully behind MBAs, indeed I almost did one myself. What I was referring to is the unfortunate product of MBAs which can, not always, but can result in over-confident, inexperienced students believing that they understand business inside and out – and to prove it they start spouting acronyms left right and centre!
Dlog, you're absolutely right – nothing ventured, nothing gained and all that. However, in this instance, I do not think it would be prudent to talk to a total stranger about my business when I have my suspicions about his validity and motivations in the first place.
As for what my business does: we make a machine that can cure all known disease. Someone mentioned that the fact that the machine can only be fuelled by war diamonds, endangered animal pelts or new born babes might be a problem. However, I firmly put them in their place when I told them that the by-product was an abundance of weapons-grade uranium – at last we could make it attainable for everyone!
Ahem... I am actually in the rag-trade selling via e-commerce and mail-order.
Just read your blog and hope the financing you were after comes through.
Just a thought though, seeing as you describe yourself as a marketeer how come you don't use your blog or indeed this one to promote your company web site? You never know Rachel, Stephen and DLOG might be looking for a few rags.
As for promoting the web site, there are a number of reasons why I have chosen not to:
1.Firstly, although my company is by no means a household name, within its sector it is fairly well known. My blog is there to be an honest account of my trials and tribulations in this business as well as some general thoughts on other topics. I'm not sure how my customers would react if they thought we were in trouble – would they stop buying from us because they would worry that they may not receive their order? Also, would some stop buying from us because they disagreed with some of my opinions (not that I'm particularly controversial I don't think)?
2.Secondly, I know pride comes before a fall but there is an element of pride in that I don't want my competitors rubbing their hands with glee or changing their strategy according to what would effectively be insider information.
3.Finally, as you know, I am a fairly recent contributor to this blog and I would not expect people to suddenly feel empathy for my business without feeling comfortable with me as a contributor. Regardless of whether they agree with my views, I think people like to know what kind of person they're dealing with.
Just to clarify, the reason I am quite proud that RLD generated T/O of over £100 million is because I know how difficult it is to generate sales - especially when working on a shoestring budget...
The T/O went something like:
Year 1 £10k Year 2 £30k Year 3 £120k Year 4 £300k Year 5 £600k Year 6 £900k Year 7 £1.2m Year 8 £3.3m Year 9 £4.7m Year 10 £5.6m Year 11 £10m Year 12 £14m Year 13 £18m Year 14 £18m Year 15 £18m
All achieved on cumulative marketing spend of less than £1m. Which shows the huge power of PR.
The company was profitable from year 2 through to year 14 EXCEPT Year 13 which was the 'annus horribilus' where we generated the £4.7m loss which would bury us.
Growth slowed because we were cash starved.
FYI C we never had any 'debt' in the sense of bank loans, in fact the company had £3.3million cash at bank when it was forced into administration.
Ok correct me if I am wrong but I am guessing you banked the cash when vouchers were paid for but only paid out when the experiences were taken. That's sensible because some won't redeem. However, all the vouchers you issued are like promisory notes and thus a liability.
If that's the case then its no surprise you were making profits initially because of the lag between sale and redemption. Of course if you sell the vouchers in bulk but without payment upfront the reverse becomes true; you have the liability without the income. This is I suspect the bank issue, namely they could see the potential liability and got cold feet when actually you could probably have traded through it.
If I'm right then you really needed a good FD to manage the risk and the bank. Being a great marketeer is one thing, being a great FD something completely different.
Take £10,000 in £10 notes and sell them on the street for £9.99. Repeat until you run out of cash. In no time at all you'll have a £1m turnover business oh and no £10,000.
Rachel, I (or some of my friends rather) put some cash in your pocket. I received an RLD experience as a birthday present back in the early 90s – never took it. That's pure profit from attrition – in the same way health clubs make a packet from people never actually going to the gym. Shame you didn't have more customers like me eh?
Stephen – what are you saying? Try building up a business to a reasonable turnover from a blank sheet of paper? I think that's what most entrepreneurs attempt to do isn't it? Although, of course, what they should actually be doing is trying to build up a highly profitable business rather than simply focussing on turnover.
Businesses go under at different stages of their life-cycle for different reasons. Rachel did good for sure – no argument there.
It is much harder to make a profit in an established sector than it is to do so in a new one. Sure RLD established a market but then screwed up when it came to maturing the business.
You would probably see my businesses as boring but we employ people, make stuff, export it and make a profit. We are constantly innovating but you'd probably see that as boring too.
'You never know Rachel, Stephen and DLOG might be looking for a few rags'.
C, been there done that, used to sell stuff down the market, and yeah, without a trading licence, heehee, actually made a few quid out of selling clothing, used to buy cheap from the manufacturers.
“Don't you understand that Rachel built a business entirely against the grain. One that was highly innovative, at the same time as profitable.”
When you say “against the grain” do you mean that people didn't actually want the RLD product and Rachel had to force customers to adopt it? Or simply that “highly innovative” and “profitable” don't go hand in hand?
When you say “against the grain” do you mean that people didn't actually want the RLD product and Rachel had to force customers to adopt it? Or simply that “highly innovative” and “profitable” don't go hand in hand?
What i mean, is that Rachel didn't just give people more of the same kind of brand. What she did was give people something entirely new, fresh and in a very innovative way.
What she did went against the grain in the sense that she didn't simply follow conventional guidelines to appeal to a ready made marketplace (like most). What she did was to effectively develop an entirely new marketplace (in other words thousands of customers who had never ever purchased such a product).
Theirin lies the magic.
This to me is where "real growth" comes from and why this kind of expertise must be harnessed and directed in order to dig us out of the mess that improper, ineffective and deceitful imagination has got us to.
And she did it all in a way that was profitable and sustainable.
This is what i saw when she was hoisted out of RLD. And why i felt rage at the way she was treated.
This it the place where entrepreneurs really can make a difference.
If I look back, and as I discover more of myself, I would say that I am a creator. Some people do it with clay, others with paint, my medium (at that time) was business.
Much as my passion for business remains I would say that my medium these days is energy, I am an energy worker; I'm still experimenting with it, I'm still not sure how good I am, but when it works it can have a magical effect.
I think Julian (Walltastic), DLOG, Hani, Bradley and others who I have worked with might agree...
If I look back, and as I discover more of myself, I would say that I am a creator. Some people do it with clay, others with paint, my medium (at that time) was business.
yes, it will be interesting to see if there is a big change in investor psychology. From one that invests in the exploitation of existing energies to one that invests in entrepreneurs who through their activities actually produce new pockets of energy, leading to real economic growth.
Innovation is key, because it is through innovation that we will expand the business spectrum, leading us away from the desperate, grasping pack hunting mentaility that we have witnessed over the past decade or so.
Why fight over the deminishing scraps, when we have the power to be kings?
I think you are a very creative person Rachel and I can can feel your energy. Some wonderful things have happened which I can pin point to you. I don't forget that. Thank you.
Lets support inventors, designers and real growth entrpreneurs more than simply people who spot an opportunity to exploit someone elses patch. Not everyone can be a Microsoft, but innovation is the lifeblood of economic growth - not spindoctors and speculators.
Things just manifest on a daily basis, and without trying. Even the people I have met, Hani, Stephen, Bradley, Leona, etc etc, somehow it is like a gyroscope spinning and satying steady, yet also atracting such beautiful things, and no matter how it is atracted it still stays steady.
Keep up the good work Rachel, youre doing a grand job, and I think that I can be confident in sayiing everyone agrees with me.
hmm, anonymous, do you know me, ok ok let me answer that for you, NO YOU DON"T, so I suggest you keep your unfounded rude comments to yourself, until such time of course you do find out who I am.
Unless of course there is anyone here who does know me and agrees with anonymous!!
Rachel, Thank you for explaining what happened in Year 13. I never fully knew what had occurred. There is quite a bit of passion and intensity here for commentaries on a blog about heckling at a British Library event...I had to recheck the page title to make sure I wasn't reading Joanna Lumley or Natalie Dormer's blog. Best wishes from an non-Angry American, Mike
...is one of Britain’s highest profile female entrepreneurs.
Having started her working life as an office junior, at the age of 24 she created the market leading experiences brand Red Letter Days on a shoestring budget from the front room of her home. Red Letter Days went on to generate over £100million in turnover in the 16 years that she ran it, and in doing so pioneered the UK's £250 million experiences sector. This earned her an Ernst & Young Entrepreneur of the Year award in 2002, as well as being short listed for the 2001 Veuve Clicquot Businesswoman of the Year award.
In early 2005, Rachel shot to fame as one of the original Dragons in BBCTV's BAFTA nominated cult business show Dragons’ Den.
After the well-publicised crash of Red Letter Days in 2005, Rachel became heavily involved in the Small Business Sector and recently won the IAB 'UK Champion of Entrepreneurship' award for 2008. Her unique Entrepreneurial Profiling Test was launched in 2007 and you can take the test free by visiting www.rachelelnaugh.com. Rachel's first book 'Business Nightmares' was published by Crimson in May 2008.
72 comments:
Although I was there, still had to watch it, and gotta say, you where absolutely brilliant - different class Rachel, lovely job!!
TheArgo
BRILLLLLIANT Rachel.
You said it ....
You said it for all of us out here who know what its like to build something with love.
And then have some Darlek tread on it and make us feel like crap.
What you said....
means a lot...
The clip was too short - it failed to show the audience reaction which was totally supportive of Rachael.
People at a BL lecture do not foot stamp but they got pretty close to it in response.
AK
What was that heckler thinking???
Always better to have tried and failed than never to have tried at all. If you have some success along the way then that's a bonus.
Strange to have come from a Yank because that's exactly the kind of negative British attitude that stifles business in the UK.
Maybe that's why she lives here?
I wasn't there but what exactly was her point/ problem?
C
TheArgo?
Welcome back DLOG
C
Cranberry, that is the whole point the heckler wasn't thinking!
C, why would you think that TheArgo is DLOG?
TheDLOG's real name (it is no secret) is Jason. TheArgo is the sort of nickname someone with the name Jason is likely to pick up. It could be worse, it could have been Donovan...!
So come on DLOG, come clean!
C
It is hard to know why such people come to these events.
It reminded me of academic conferences where the "normal" disingenuous reason for "questions" is to either rubbish the speaker, or blatant promotion of the person asking the question.
As Ali said - That lady got a very hard time from the audience - And it serves her right.
The video doesnt capture the deserved "fire" that came along with the answer from Rachel!!...if looks could kill.
For all that:
I would not dignify such a person by giving her air time on youtube.
Yea, she was a pretty cool customer. Libarian by Day, mild mannered entrepreneur by night.
Really got all the bases covered there.
I thought she might have been a Seth Godin Spy.
ha!
Technical problems this end - I will get my post up without jambled text after a restart I excpect.
She also doesn't understand banking. Banks are not duty-bound to provide loans regardless of what Gordon Brown might think. Banks are there to make money just like any other business and it's entirely up to them to decide whether to loan or not. The only kind of bank that could be duty bound to loan would be a sovereign bank – which Northern Rock effectively is – and look what they've been told to do. But even a sovereign bank could would still turn people away.
I mean – what kind of bank would consider loaning to someone with No Income, No Job and no Assets? Wait a minute...
Go Rachel!
Simply brilliant and I'm so pleased that you put ‘Mrs Angry’ in her place.
Martin
I wonder if she reads this blog?
C
Banks are not in business to make money. They are in business to proliferate illusory money.
Banks, in effect are "bubble makers".
The purpose of banks should be to safeguard the nations wealth.
What they have done in effect - is to steal our money, by using underhand tactics.
We need to clear the high-street of commercial banks and such like and put all our money in one big nationalised bank.
Why... we could call it ........
The Bank of England
Stephen
I'm sure that if that happened, the 'Bank of England' would do something to upset you, and you would then be blaming the 'Bank of England' for all your woes
cheap anonymous
I don't think the banks were being underhanded Stephen, although there were certainly unforgivable failings.
As I have stated previously on my blog, my view is that the finger of blame will ultimately be pointed at the hedge fund industry. It was/is completely unregulated and yet in 2007 controlled well in excess of $1trillion worth of assets.
These funds did so well that they believed they could trade anything, so new financial products were devised to satisfy the hedge fund's want – the most sinister of which was debt packages such as swap derivatives where funds would take on debt risk a) without having the cash to pay the debt should they ever need to and b) not even knowing what the potential scale of the debt could be and who untimely owes it. Because hedge funds fundamentally profit from the difference in points between assets, it didn't matter what the assets consisted of, just so long as the assets had a fluctuating price. So hedge funds just wanted big ticket assets that had fluid price ranges and debt packages provided just that.
Finally, along come the big banks a bit late to the party but they want some of the fun. So our banks start behaving like hedge funds and venture into leverage positions that they simply do not understand. What happened is pitiful but it's not sinister as some think - when you have collective idiocy like this, you end up with bubble and burst.
Yep C and why don't you come clean too?
I have now seen your writing - and know who you are you little scoundrel you.
R
Yes who are you Cranberry?
What was the heckler thinking of?!
Thought you managed her very well.
No chance, I'm rather fond of my without prejudice status.
Come clean about what exactly? You'll have to be more specific as a wide ranging confession might take some time...
C
Other than calling RLD a crap idea (not a crap idea, just a 'small' idea in real terms IMHO), the questionner (again not really a heckler IMHO) had some good points.
Rather than put the 'heckler' in her place, however, I thought your defence was utterly Gordon Brownesque (we had ten years of growth, record investment, blah, blah, blah). The end result is the same: BUST. If I recall RLD went belly up before the 'credit crunch' was even termed.
Plenty of material there for all the brown-nosers on this site that ruin what could be a very useful blog.
Not really Anonymous. The questioner was clearly having a go at the banks with no good reason and then threw in the RLD comment for theatre. You simply cannot secure against illiquid assets right now – stop moaning and understand the situation.
Whether RLD was a crap idea or not isn't really the point. Whether it was profitable is the point.
Personally, I'm not impressed with talk of turnover figures. Why Rachel insists on talking about £100m turnover I don't know. Unless I've completely missed something, she's talking about aggregate turnover over 16 years – which doesn't present RLD as anything special.
£1million annual net profit (if it was net profit), is interesting and special if that was achieved consistently given the likely annual turnover figures.
Please remember Cranberry that there are a lot of people who read this blog that actively follow Rachel, as much offline as online. Many of these people have shared a special relationship with her and if you read back through the comments on this blog you will find many of them.
It doesn't take a lot of brains or balls to turn up at a venue with a loaded gun and fire off a few rounds from the back row. But it does take a lot to build quality relationships and that is what Rachel does.
Also, i must take issue with your perspective of success in business. If you were to carefully analyse Rachels contribution you would begin to appreciate just how much it takes to achieve what she has.
I am happy to take this offline if you want help understanding this.
Stephen, my point, which you have chosen to completely overlook, was one about turnover vanity.
Since you are having difficulty understanding this, I will repeat it for you: the size of turnover of a business is not relevant to company matters – profit is – that being net profit which directly adds to the cash held by the business. However, people tend to be impressed with turnover numbers because they are generally the highest - which is why they get banded about so much.
Now in that, is there anything that slates Rachel or RLD? I don't think so. It's an observation of the use of turnover vanity which is extremely common in the business world. Where exactly have I ventured into talking about Rachel's life contribution or achievements? I have not.
This blog is an open forum – anyone can post and contribute. Someone could post an extremely disparaging post about Rachel – that's the nature of the beast. I suspect though, that you would prefer this blog to be a place where people with a special relationship to Rachel cozy up and get all snugly together. If you're not prepared to put up with the varied views posted on this blog then stop reading it or get Rachel to take it offline.
You really need to be less defensive when it come to Rachel – it would appear that you see red at the slightest mention of her name by a non-Stepehn approved contributor. Before you read a post that has the word 'Rachel' in it, slow down, read it again and ask yourself: “is this unnecessarily offensive towards Rachel or is there a valid point in the post's content?”. Only this way, I think, will you stop yourself from firing-off half-cocked.
Cranberry
I have said as much elsewhere on this blog re the turnover vanity, profit sanity argument. Above both of course comes cash, the lack of which was RLD's demise.
To be fair to Stephen though he does have a point. Rachel did develop a niche into a fairly sizeable market. None of my businesses have done this (we are in the better mousetrap category) and as such all are probably limited in potential. Mind you, we are profitable, have no debt and have cash. Maybe mousetraps aren't so bad afterall.
C
I do not think Rachel has turnover vanity. What she achieved in turnover/profit was only a small part of her overall success story.
Her real (genius) and i do not use this word lightly was in inventing a totally new and innovative marketplace - (in effect - the experiences sector). I'd say 99.9% of entrepreneurs either operate as (same old, same old) or as (leveragers of existing markets).
What Rachel achieved was to start with a blank sheet of paper and invent an entirely new marketplace from the backroom of her home. From that one marketplace others have developed new businesses and products and more.
What she saw and built was a totally new way of thinking. A new paradigm in recreation.
This is not unlike the vision of Bill Gates and his vision for a PC on every desk.
She may of course never achieve this standard again, but people need to look at what she achieved from more than one dimension and perhaps stop measuring these types of people by their own narrow standards.
High achievers are successful in many different areas of their life and business - not just one.
Listen very carefully, I shall say zees only once...
I am not in the business of knocking Rachel. I have absolute respect for what she has and, continues, to achieve. Having said that, does that mean that she or her dedicated followers are not open to questioning?
What is the benefit of stating a turnover figure that represents 16 years worth of trade? In my book it serves nothing unless you are impressed by such a figure or somehow construe that this represents just one year's trade?
That is my point and it does not detract from everything good that Rachel does. It is merely an observation and worthy of questioning.
This blog could be so much more interesting if certain people would stop taking anything that is not positively gushy as a personal attack against them or Rachel.
Back to the topic itself. Throwing stones in glass houses springs to mind re the heckler, who runs a vinyl record shop.
Mind you Decca records did reject the Beatles in 1962, stating that 'goups with guitars are on their way out'
Peter
Oh, I meant 'groups' not 'goups'
Time to go out to build a snowball with the kids I feel...
I suspect she quotes this kind of stuff because it is evidence of past business performance, rather than quoting the intangibles of her success. But remember RLD was only part of her portfolio.
Many people wouldn't understand what it takes to achieve what she did.
A lot of the people i talk to tell me that they are self-made millionaires, but when you look closer, their success can be attributed to chance or to the sacrifice of others. And then when you look at where they made their money - took absolutely no innovation at all.
There are very few who can engineer and still fewer build a consumer marketplace.
From Zero to Hero.
We need more Rachels now and fewer hecklers. The country needs to create more capacity for kick-starting growth. We cannot acheive this if we don't back the right people. The make or break will be whether we can recognise the right attributes and talent in our leaders and support them - or if we are just going to use the same old ways of measuring potential- which has effectively lead the country to get into this mess.
So £100m over 16 years represents, on average, just over £6m a year – which is only slightly above small business status.
That's all I'm saying, how you present the figures can have a significant impact upon perception.
Yes, i understand Cranberry.
I am sure had Rachel had the time to respond to the heckler further, she would have expanded on explaining her successes more fully.
But then i'm not sure whether the heckler would have been able to grasp it - given she is so unconfident about being an entrepreneur as to keep a day job!
I certainly agree with that Stephen – I wouldn't tolerate being told my business was crap by a part-timer!
Lol that is even better than I imagined it to be when described, you couldn't have handled that better if scripted.
The look of amusement on your face just added to the effect. You handled that one perfectly.
I agree with Alistair, it would have been nice to get that little bit more.
The Idea for RLD isnt crap and there is still companies operating similar and so is RLD.
But good luck for the future, and i asked cranberry to speak to me I have since decided not to I feel you are a waste of my time, and I see you have sold one of your businesses and one is sufferring?? That is a shame isnt it, well do a SWOT analysis followed by a SMART Analysis - you may be re guided?
Who knows I am a Trained (almost licenced) Insolvency advisour.......
2009
Personally, i don't have a problem with hecklers. I just think they should pick the right targets.
There are just so many targets out there and there are £10trillion reasons why. Recession is the rich mans way of saying.......Well time to tax the poor more...in order for us to can hide more.
Give it back!
http://www.bbc.co.uk/iplayer/episode/b00hd3x0/Panorama_Tax_Me_if_You_Can/
Gutted 2009. No, really I am.
Cranberry
I think you should heed 2009's advice and get those analyses down ASAP or you might find yourself in need of an insolvency "advisour"...
C
Quit jerking around Cranberry and 2009. Why don't you get together on MSN or Skype first?
Doesn't make sense to let the f* business fail.
Just sort it guys!
Rachel, can you bang their heads here.
2009 sounds like the real deal - it could help maybe!
Seems a bloody shame.
Yep, I agree with Stephen, get yourselves together and see if you can't sort something out, don't let the company go down, get help, what ever is offered take it, you never know what little piece of advice you may have missed Cranberry, and 2009 make that contact.
TheArgo
I didn't mean to be harsh to cranberry Stephen, but I don't have time to do Skipe or MSN..
But yes I would advise to take heed, and I am sure it will make a positive result for you and there is much more to it, you want the help you make the request for my help and I shall. (For free) - Do you realise my advise would cost you god knows what in countless "Business rescue packages" I am 28 and i have made a lot of money and I believe in sharing advise I DO NOT HEED FAILURE of any kind!
And the words "Theese things happen" "I lost control" "I put somebody else in charge of the finances" - All theese to me say one thing and that is "WEAK"
2009
2009
Stephen, Dlog I appreciate your concern - I'm lucky enough to have a decent team of people around me, in whom I have great faith - and we're still here which I would not have put money on six weeks ago.
I'm fiercely tenacious and have had both business success and failure so you can rest assured that I can see both sides of the coin, and will not go down without a fight - but sometimes business goes beyond first term MBA analyses.
You'll forgive me if I don't buy 2009's rhetoric. I've taken the time to go through past posts and what he has written does not indicate any significant level of experience, expertise or insight (although I did see that C had mentioned the whole profit, turnover vanity issue previously, so I apologise for bringing that up again).
Maybe I'm looking a gift-horse in the mouth? I suspect I'm not. I don't think he's genuine. You would have thought that someone who's an advisor by profession would know how to spell the word.
C cracks me up!
Well one thing i learn't. You can't get enough advice.
But of course, consultants are rarely that effective when it comes to rolling up your sleeves and fighting your way out of trouble.
In fact i found most of them to be expensive doomsayers who cared as much about my business as my competitors.
Only any good in small doses.
I was given a horse once and despite the obvious temptation...
Anyway, don't go knocking MBAs, it kept me in a job once but I have to agree that in business it's as much use as the aforementioned horse.
Cranberry is right though. In my experience, anyone who professes to be working in an area of English law really needs to have a rudimentary knowledge of English. Latin helps too plus a good line in bullshit as most lawyers seem fluent in that.
What exactly is your business Cranberry? Interesting how everyone has rushed to help when in fact you might be an arms dealer, pushing drugs on children or worst of all a banker...! (Ok I know I was one of those once but I have changed honest!)
C
C, doubt he would be in trouble if he was an arms dealer/drug pusher.
Seriously though Cranberry, sometimes talking to anyone, academically educated or just street wise can bring an answer that you need. When we feel under pressure we can sometimes miss the most simplest of things that would otherwise be brought to attention by somebody else, ie; 2009.
Remember the BT advert, "it's good to talk"
TheDlog
PS: the true dlog
It sure was a cheap shot… RLD’s wasn’t a crap idea; otherwise it wouldn’t have been a business at all.
Unfortunately Rachel, like some people, who are famous for being famous… whether you like it or not, you’re famous (or infamous to some negative people) for being a “business failure”. Your book, Business Night just adds to this public persona, whether people have read you book or not.
It’s this ‘fame’, which gives people an uneducated excuse to heckle you publicly. I’m sure most people who run a business would have more respect.
Keep up the good work!
C, I'm fully behind MBAs, indeed I almost did one myself. What I was referring to is the unfortunate product of MBAs which can, not always, but can result in over-confident, inexperienced students believing that they understand business inside and out – and to prove it they start spouting acronyms left right and centre!
Dlog, you're absolutely right – nothing ventured, nothing gained and all that. However, in this instance, I do not think it would be prudent to talk to a total stranger about my business when I have my suspicions about his validity and motivations in the first place.
As for what my business does: we make a machine that can cure all known disease. Someone mentioned that the fact that the machine can only be fuelled by war diamonds, endangered animal pelts or new born babes might be a problem. However, I firmly put them in their place when I told them that the by-product was an abundance of weapons-grade uranium – at last we could make it attainable for everyone!
Ahem... I am actually in the rag-trade selling via e-commerce and mail-order.
Cranberry
Just read your blog and hope the financing you were after comes through.
Just a thought though, seeing as you describe yourself as a marketeer how come you don't use your blog or indeed this one to promote your company web site? You never know Rachel, Stephen and DLOG might be looking for a few rags.
C
Thanks C – we shall see what happens tomorrow.
As for promoting the web site, there are a number of reasons why I have chosen not to:
1.Firstly, although my company is by no means a household name, within its sector it is fairly well known. My blog is there to be an honest account of my trials and tribulations in this business as well as some general thoughts on other topics. I'm not sure how my customers would react if they thought we were in trouble – would they stop buying from us because they would worry that they may not receive their order? Also, would some stop buying from us because they disagreed with some of my opinions (not that I'm particularly controversial I don't think)?
2.Secondly, I know pride comes before a fall but there is an element of pride in that I don't want my competitors rubbing their hands with glee or changing their strategy according to what would effectively be insider information.
3.Finally, as you know, I am a fairly recent contributor to this blog and I would not expect people to suddenly feel empathy for my business without feeling comfortable with me as a contributor. Regardless of whether they agree with my views, I think people like to know what kind of person they're dealing with.
Just to clarify, the reason I am quite proud that RLD generated T/O of over £100 million is because I know how difficult it is to generate sales - especially when working on a shoestring budget...
The T/O went something like:
Year 1 £10k
Year 2 £30k
Year 3 £120k
Year 4 £300k
Year 5 £600k
Year 6 £900k
Year 7 £1.2m
Year 8 £3.3m
Year 9 £4.7m
Year 10 £5.6m
Year 11 £10m
Year 12 £14m
Year 13 £18m
Year 14 £18m
Year 15 £18m
All achieved on cumulative marketing spend of less than £1m. Which shows the huge power of PR.
The company was profitable from year 2 through to year 14 EXCEPT Year 13 which was the 'annus horribilus' where we generated the £4.7m loss which would bury us.
Growth slowed because we were cash starved.
FYI C we never had any 'debt' in the sense of bank loans, in fact the company had £3.3million cash at bank when it was forced into administration.
R
bloody told you.
Try doing that from a blank sheet of paper.
Rachel
I think I said liabilities rather than debt.
Ok correct me if I am wrong but I am guessing you banked the cash when vouchers were paid for but only paid out when the experiences were taken. That's sensible because some won't redeem. However, all the vouchers you issued are like promisory notes and thus a liability.
If that's the case then its no surprise you were making profits initially because of the lag between sale and redemption. Of course if you sell the vouchers in bulk but without payment upfront the reverse becomes true; you have the liability without the income. This is I suspect the bank issue, namely they could see the potential liability and got cold feet when actually you could probably have traded through it.
If I'm right then you really needed a good FD to manage the risk and the bank. Being a great marketeer is one thing, being a great FD something completely different.
C
Yeah told me so, er not.
Here's one for you Stephen:
Take £10,000 in £10 notes and sell them on the street for £9.99. Repeat until you run out of cash. In no time at all you'll have a £1m turnover business oh and no £10,000.
C
Rachel, I (or some of my friends rather) put some cash in your pocket. I received an RLD experience as a birthday present back in the early 90s – never took it. That's pure profit from attrition – in the same way health clubs make a packet from people never actually going to the gym. Shame you didn't have more customers like me eh?
Stephen – what are you saying? Try building up a business to a reasonable turnover from a blank sheet of paper? I think that's what most entrepreneurs attempt to do isn't it? Although, of course, what they should actually be doing is trying to build up a highly profitable business rather than simply focussing on turnover.
Businesses go under at different stages of their life-cycle for different reasons. Rachel did good for sure – no argument there.
I reckon a lot of people on here have been used to bulding boring products and boring businesses. The kind that don't need any imagination.
Don't you understand that Rachel built a business entirely against the grain. One that was highly innovative, at the same time as profitable.
Anyone can develop a me-to-idea, but she didn't do that. That's the significance of her contribution.
In most cases these kind of innovative business are unsustainable. The RDL concept has stood the test of time.
Its a really great idea.
And C... Your £10/£9.99 scenario sounds like the same game the world economy has been playing - and about 99.9% of other businesses.
Stephen
It is much harder to make a profit in an established sector than it is to do so in a new one. Sure RLD established a market but then screwed up when it came to maturing the business.
You would probably see my businesses as boring but we employ people, make stuff, export it and make a profit. We are constantly innovating but you'd probably see that as boring too.
C
'You never know Rachel, Stephen and DLOG might be looking for a few rags'.
C, been there done that, used to sell stuff down the market, and yeah, without a trading licence, heehee, actually made a few quid out of selling clothing, used to buy cheap from the manufacturers.
dlog
“Don't you understand that Rachel built a business entirely against the grain. One that was highly innovative, at the same time as profitable.”
When you say “against the grain” do you mean that people didn't actually want the RLD product and Rachel had to force customers to adopt it? Or simply that “highly innovative” and “profitable” don't go hand in hand?
Either way, I'd disagree with you on both counts.
When you say “against the grain” do you mean that people didn't actually want the RLD product and Rachel had to force customers to adopt it? Or simply that “highly innovative” and “profitable” don't go hand in hand?
What i mean, is that Rachel didn't just give people more of the same kind of brand. What she did was give people something entirely new, fresh and in a very innovative way.
What she did went against the grain in the sense that she didn't simply follow conventional guidelines to appeal to a ready made marketplace (like most). What she did was to effectively develop an entirely new marketplace (in other words thousands of customers who had never ever purchased such a product).
Theirin lies the magic.
This to me is where "real growth" comes from and why this kind of expertise must be harnessed and directed in order to dig us out of the mess that improper, ineffective and deceitful imagination has got us to.
And she did it all in a way that was profitable and sustainable.
This is what i saw when she was hoisted out of RLD. And why i felt rage at the way she was treated.
This it the place where entrepreneurs really can make a difference.
Stephen
Thanks for your kind words and support, as ever.
If I look back, and as I discover more of myself, I would say that I am a creator. Some people do it with clay, others with paint, my medium (at that time) was business.
Much as my passion for business remains I would say that my medium these days is energy, I am an energy worker; I'm still experimenting with it, I'm still not sure how good I am, but when it works it can have a magical effect.
I think Julian (Walltastic), DLOG, Hani, Bradley and others who I have worked with might agree...
R
If I look back, and as I discover more of myself, I would say that I am a creator. Some people do it with clay, others with paint, my medium (at that time) was business.
yes, it will be interesting to see if there is a big change in investor psychology. From one that invests in the exploitation of existing energies to one that invests in entrepreneurs who through their activities actually produce new pockets of energy, leading to real economic growth.
Innovation is key, because it is through innovation that we will expand the business spectrum, leading us away from the desperate, grasping pack hunting mentaility that we have witnessed over the past decade or so.
Why fight over the deminishing scraps, when we have the power to be kings?
I think you are a very creative person Rachel and I can can feel your energy. Some wonderful things have happened which I can pin point to you. I don't forget that. Thank you.
Hear, hear Stephen.
Lets support inventors, designers and real growth entrpreneurs more than simply people who spot an opportunity to exploit someone elses patch. Not everyone can be a Microsoft, but innovation is the lifeblood of economic growth - not spindoctors and speculators.
KEL
Rachel,
Absolutely, the energy you emit is unreal.
Things just manifest on a daily basis, and without trying. Even the people I have met, Hani, Stephen, Bradley, Leona, etc etc, somehow it is like a gyroscope spinning and satying steady, yet also atracting such beautiful things, and no matter how it is atracted it still stays steady.
Keep up the good work Rachel, youre doing a grand job, and I think that I can be confident in sayiing everyone agrees with me.
thedlog (offcial dlog)
snakey dlog. self interested snakey dlog.
hmm, anonymous, do you know me, ok ok let me answer that for you, NO YOU DON"T, so I suggest you keep your unfounded rude comments to yourself, until such time of course you do find out who I am.
Unless of course there is anyone here who does know me and agrees with anonymous!!
thedlog
Rachel,
Thank you for explaining what happened in Year 13. I never fully knew what had occurred.
There is quite a bit of passion and intensity here for commentaries on a blog about heckling at a British Library event...I had to recheck the page title to make sure I wasn't reading Joanna Lumley or Natalie Dormer's blog.
Best wishes from an non-Angry American,
Mike
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