The best entrepreneurs have something to prove
The co-founder of lastminute.com, Brent Hoberman talks to business editor Candice Krieger about what makes a successful start-up and why Jews can make great entrepreneurs.
Since selling lastminute.com, Brent Hoberman hasn’t stopped. The entrepreneur makes it his business to help start-ups (and set up a few of his own). He talks to Candice Krieger about how to stand out, missing out on the chance to invest in Airbnb and why Jews make great entrepreneurs
It’s the million, or even billion, dollar question; when it comes to taking a punt on a successful start-up, is it more about the person or the idea? Few are more qualified to ask than serial entrepreneur and investor Brent Hoberman, who credits the person. Better still, a slightly unhinged one.
Known to many for co-founding lastminute.com – Hoberman grew the legendary late-deals travel company to more than $2 billion in revenue and was CEO from its inception in 1998 until it sold to Sabre in 2005 for $1.1bn (£600m) – he has since set up other companies including online furniture retailer Made.com. But most of his time is spent fielding pitches from aspiring entrepreneurs as chairman of Founders Factory, his corporate-backed start-up incubator and accelerator.
Hoberman says: “There are positive benefits of being a bit unhinged as it were, and some of that is passion, excitement, enthusiasm and falling in love with the business you are building and that helps you attract people to it, whether it’s investors, clients or talent.”
He also runs Founders Forum, an exclusive community for leading entrepreneurs and investors. And there’s firstminute capital, his $100m European early-stage investment fund and robotic restaurant Karakuri.
So South African-born Hoberman knows a thing or two (billion) about start-ups, and it’s the person, he says, who is key. “There are some good businesses that people I know have passed on because they’re over-analysing the idea and saying ‘this idea could only be this big in year five’, whereas if you’re batting on the person, you’re saying ‘their first part of this idea might only be a market worth x hundred million, but they’re smart enough to find the market that’s even bigger’.”
Hoberman, who co-chairs the Prime Minister’s Business Sector Council for Britain in entrepreneurship, scale-ups and small business, says a principal thing he learnt during his time at lastminute, was the importance of the team. “We went with inexperience and talent over experience and that proved to be wise.”
We went with inexperience and talent over experience and that proved to be wise.
Hoberman wasn’t yet 30 when he founded lastminute with Martha Lane Fox. It became one of the world’s most recognised websites.
He acknowledges it has become easier to launch a business today, making it harder for entrepreneurs to stand out. “You need to differentiate earlier. You create the lifetime DNA for your company with the first five hires, and it’s very hard to change, so getting that right is gold dust.”
He set up Founders Factory with Henry Lane Fox, Martha’s younger brother, to help start-ups get it right. It partners with corporates including L’Oréal, easyJet and Johnson & Johnson – the first United States-based partnership. The idea is that the start-ups learn from the corporates to help them scale, while the corporates get early access to R&D to help them innovate.
Founders Forum is a series of intimate invite-only events. Previous attendees include Eric Schmidt (Google) Reid Hoffman (LinkedIn) and Net-a-Porter’s Natalie Massenet. Firstminute is backed by Atomico – Skype co-founder Niklas Zennström’s investment firm – Tencent and more than 30 unicorn founders.
Hoberman was awarded a CBE for services to entrepreneurship in 2015 and has become one of the UK’s best-connected tech entrepreneurs. So much so that the founder of Uber approached him for advice. He recalls: “Travis (Kalanick) came to see me after starting Uber to ask about how to enter Europe. I told the person who introduced me: ‘Next time you send me someone like that, tell them to ask me for money, not advice!’”
He was also offered the opportunity to invest in Airbnb. “It was already worth 200 million but that still would have been a good deal! I’m more of a seed investor so that’s why I didn’t do that one.
“I have been close to touching some of those mega ones but if you’re in investment games, there will always be ones – that’s why some people don’t love investing because you’re always going to miss some.”
A father-of-three, Hoberman studied at Eton and holds an MA in French and German literature from Oxford, where he learnt to “think differently”, a trait, he suggests, makes good founders.
When it comes to successful entrepreneurs, the illustrious Israeli investor Yossi Vardi has said that Israel has so many because of the hard-to-please Jewish mothers who make their children feel insecure and want to prove themselves. Is this true?
“Nine times out of 10 most successful entrepreneurs are trying to prove something. That’s why so many fantastic entrepreneurs are immigrants and I think why so many Jewish people are successful. There is lots of research, in the UK and Silicon Valley, showing immigrants are disproportionately successful.”
As for the best ideas, he says they are from people who can see the future when others can’t. “That’s where Airbnb is interesting – most smart investors said no to it, and I am hoping Karakuri will be like that. Most smart investors said no until we got Ocado saying yes, which will make everyone think ‘oh this isn’t actually Brent smoking something and maybe they are onto something.’”
Nine times out of 10 most successful entrepreneurs are trying to prove something. That’s why so many fantastic entrepreneurs are immigrants and I think why so many Jewish people are successful. There is lots of research, in the UK and Silicon Valley, showing immigrants are disproportionately successful.
He continues: “It’s a great founder combined with a great ‘why now?’ slide. Why is this the moment to do this business and why are you better placed than anyone else to do it now?”
Would he ever go back to lastminute? “What, to go and buy it?” he jokes. “No, it would be too frustrating. One of the exciting things about lastminute.com was how we were so early at so many things and lots of those still haven’t been done and it’s too frustrating.
“But it’s not just them who have squandered the opportunity – it’s many of their competitors too. Travel is a very crowded space with notoriously low margins except for hotels, so that’s why, when I looked at furniture.com with Made.com, I was like ‘wow, look at these margins, you can do something with that.”
And doing something with that, and dozens of others, he most certainly is.
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