There was no Tony Curtis or jaunty jalopies but it was Monte Carlo or Bust for 49 leading business men and women last week in Monaco as they bid for to be crowned the 2011 Ernst Young World Entrepreneur of the Year. Singapore woman Olivia Lum, who was abandoned as a child but now runs a large water treatment company, took the gong but there were many other fascinating stories told over the four days in the Mediterranean tax haven.
Entrepreneur reaping the fruits of Jucy idea
THERE’S A touch of the Michael O’Leary about New Zealand entrepreneur Tim Alpe.
He set up a company called Jucy on the day after 9/11, aimed at the backpacker market. He started off by buying 35 Daewoo Lanos cars and hiring them out as cheap rentals. He then moved into camper vans, importing Hiaces from Japan and getting some boat builders to modify the interiors. “It worked and we took off from there,” Alpe told me in Monaco last week.
Jucy is a low-cost operator. Alpe was also an early adopter of the internet for bookings and he has since expanded Jucy into budget hotels and cruises.
If you want your hotel room cleaned in the first three nights, you pay extra. Alpe’s view is that most people just want a cheap bed and are happy to sleep in the same sheets. He is a regular blogger and uses media coverage to advertise the business.
Jucy now has 2,500 vehicles and 165 staff in New Zealand and Australia. He’s planning to target the US. “We’ll be launching in California this year. We’ll look at setting up depots in Los Angeles and [Las] Vegas as well.”
He doesn’t rule out expanding into Britain, and China might be a possibility. Ireland probably isn’t big enough but Alpe does have a relationship with Dublin-based CarTrawler, which acts as a rental broker and generates about NZ$1.5 million in revenues for Jucy. Revenues this year are forecast at NZ$38 million and he considered an IPO.
“We looked at that but I’ve gone cold on the idea.”
NY investment bank eyeing Dolmen deal
OF THE 49 entrepreneurs who gathered in Monaco last week, few had the colourful back story of Howard Lutnick, chairman of investment bank Cantor Fitzgerald.
Lutnick was attending his son’s first day at kindergarten on September 11th, 2001, when his driver told him Cantor’s offices in the World Trade Centre had been hit.
Cantor lost 658 of its 960 New York-based employees. Lutnick’s brother Gary was one of them. He also lost his best friend.
Lutnick said he didn’t sleep for two years. “I cried all the time. You can’t process that many people passing away,” he said.
He wrote 1,800 personal notes to relatives to offer his condolences. There were about 20 funerals a day for about 35 days. Lutnick received his share of bad press in the aftermath of the attacks when he cut the payroll of those staff who were missing within a few weeks of the towers collapsing.
He subsequently set aside 25 per cent of Cantor’s profits for five years for the families of the deceased and provided healthcare coverage for 10 years.
“They [the media] actually called it a PR stunt,” he said, citing the fact that the events of 9/11 had left Cantor teetering on the edge and with little prospect of making a profit.
“The one thing I didn’t care about was the PR. That 25 per cent amounted [over the five years] to $180 million. The thing that made me feel better was taking care of the families that had lost people.”
How did he feel when President Obama announced recently that Osama bin Laden was dead? “I was glad that justice was done finally. It’s not a celebratory thing. It’s one of appropriate justice. I’m glad it’s done and that no one else will suffer at his hands.”
Lutnick successfully rebuilt Cantor and it is now bigger than it was pre-9/11. He is now looking at expanding into Ireland.
“We’re going to expand into Dublin. We’ve been looking for a little while now. It’s a great place to do business.”
Cantor is believed to eyeing Dolmen Stockbrokers and the deal is said to be awaiting approval from the financial regulator. “I’m not going to comment on that but we are deeply considering Dublin as a place to expand.”
Love of beer and focus on family key to brewer's success
BREWER JAN-RENIER Swinkels represented the Netherlands in Monaco. Swinkels is the seventh generation of his family to run the Dutch beer maker Bavaria, which was founded in 1719.
Bavaria’s main product is a Pilsner lager that is sold in Ireland, mostly on promotion in the on-trade. It is also widely available in off licences.
While it has a small share of the market here, Swinkels told me that Ireland is one of Bavaria’s top 10 export markets out of a total of 130 counties. “It’s big for us,” he said. “It’s an important country and every year we are growing in Ireland.”
He said sales of Bavaria are growing here by 5-10 per cent a year, even in the recession. “We are not the most expensive [beer]; we want to have the right price.”
Swinkels said Bavaria has annual sales of about 500 million globally and 70 per cent are from export markets. “More and more we succeed in selling to the whole world.”
How often does he have a beer? “Every day,” he said, with a wink. “But I know how much I should drink.”
Bavaria has branched into non-alcoholic beers, which Swinkels said have proven a hit in Spain and the Middle East.
He is one of 75 members of the family working in the business. Swinkels started working on the production line at the age of 12 and, having graduated from college in food technology, started to work his way up the ranks of the company before being appointed chief executive in 2007.
The company employs 1,000 people at two breweries in the Netherlands and is proud of its independent roots. But is family ownership a sustainable corporate model into the long term in a sector where consolidation is a constant theme?
“They know we want to be a family company,” he said with a smile. “We believe in independence. So no stock market . . . no MA [mergers and acquisitions] . . . it keeps us [the family] together. We want to give the company to the next generation.”
I couldn’t finish the interview without asking him if he ever drinks a pint a stout. “Sometimes, when I’m in Dublin, I like to do that. You have to taste other beers.”
Swinkels described Guinness as a “special beer”. Diageo Ireland boss John Kennedy will be pleased.
Former footballer winning plaudits for financial software
DOWN NATIVE Brian O’Donnell might not have won the ultimate prize but he did put First Derivatives on the map at the World Entrepreneur of the Year Awards in Monte Carlo last week.
He even got to rub shoulders with a few celebrities. “We went for a coffee earlier and [actor] Donald Sutherland was sitting at a table beside us,” he tells me.
First Derivatives is in growth mode, with turnover and profits rising by an average annual 40 per cent over the past decade. It has acquired five companies in the past three years and has received a flood of applications from graduates eager to fill about 150 positions on offer with the group.
“The misfortune of the Irish economy has certainly been an opportunity for us,” O’Donnell tells me on a sun-kissed balcony at the Hermitage Hotel in Monte Carlo last Friday. “We have a bigger selection now than we had a few years ago.”
This is part of an initiative support by Invest Northern Ireland that will see 360 staff recruited in the next few years, pushing First Derivatives staff numbers up towards the 1,000 mark.
First Derivatives is listed on the Aim stock market in London and was traditionally a consulting services provider. Three years ago though it began to develop its own software for the financial services industry – a higher margin activity.
This has seen the company invest £12-15 million in research and development to develop its portfolio of products. Its clients include 70 of the world’s largest investment banks.
O’Donnell is a modest man.
Before the awards night, he rated his chances of winning at “pretty close to zero”, citing the quality of the field – but he is not to be underestimated.
A talented GAA player with Down in the 1980s before a bad injury ended his career prematurely, it was while visiting London for treatment on the injury that his business career began to take shape. With a small loan from his credit union, First Derivatives was born in 1996.
Winning the Irish entrepreneur award has been “great for the company’s profile”, he says. This is both in terms of recruitment and “getting approaches by MA types to see if we need funding”.
O’Donnell insists though that he has “nothing in mind” in terms of an exit strategy. “At the moment, I’m just concentrating on forging ahead with the business.”
