Many of my heroes I’ve never met. In fact, many were dead before I was born, such as Diogenes the Dog, Caravaggio, Shakespeare, Emily and Anne Bronte, Charles Dickens and Herman Melville. Fortunately, most of my heroes in sport, the arts and enterprise have been alive for at least some part of my long life. I’ve been able to watch and meet some of them. I’ve been able to incorporate what I’ve learned from them into my work and businesses. One of those heroes is Dr Ernesto Sirolli, pictured above.
In my show, I make the claim, from the thousands of interviews I’ve conducted with business owners, that making deals and ‘partnerships’ are essential for successful start-ups and scale-ups. I covered the importance of negotiating as the key entrepreneurial skill in my last article. The importance of partnerships, even though, he doesn’t use this term, is clear in Dr Sirolli’s work which has been instrumental in launching more than 40,000 enterprises in 250 communities and 25 countries.
I believe the most important deals a new business owner makes are with those they choose to work closely with to build their business – their ‘partners’. These ‘partners’ can come from family, friends, colleagues, suppliers, customers, employees and especially, from those in relevant business communities. As a business owner, you need to be actively looking for the skills and resources which you will need to grow your business. When you’ve found a potential partner you then need to strike up a mutually beneficial deal.
No celebrity entrepreneur did it alone
My business partner, Clare Francis, and I have proven in practice how important great partnerships, formal or informal, are. Ours is a great partnership which survives to this day – 33 years and counting, With all but two people, we’ve enjoyed and benefited from the many business ‘partnerships’ we’ve had.
Dr Sirolli says of the celebrity entrepreneur as a go-it-alone individualist; “When you look at the real story, whether it’s Steve Jobs or Bill Gates or Sam Walton ….. or the owner of a chain of dry cleaners, you see none of them did it alone. They all had (colleagues) who could do the things they couldn’t do. The way it’s presented is very dishonest. My work now is to oppose this fake mythology and show that enterprise really succeeds when the right people come together.”
We’d been running our own business for 15 years when Mike Chitty, who was then heading up the BLU – the Government’s ‘Business Link University’ told me that he was basing much of the e-learning for business support personnel on the work of Dr Ernesto Sirolli.
No entrepreneur needs ALL the skills
I’ll always be grateful to Mike for introducing me to enterprise facilitation as practised by those using Sirolli’s methodology. Until then, I’d assumed that improving the know-how, the skills, of the new business owner was the top priority for their survival and growth. I’d already discounted, by thorough research, the view of the Banks, Investors, Media and Government that the most important factor was ‘access to finance’ – funding.
Professor Allan Gibb and his great team at Durham University had described what the real-life enterprise skills are and I’d assumed that what we needed to do in the UK to improve survival and growth of new business owners was to give them those skills. I’d assumed that the expert business adviser, trainer, coach or mentor was essential for the new start-up and those wishing to scale-up. Everyone seemed to be saying that new business owners were failing because they lacked the skills and I was daft enough to believe it.
How crazy was that? To survive in my own business, I’d had to ditch most of the conventional business knowledge I’d gained from post-graduate business qualifications and as a Managing Director of a £20 million company. In fifteen years I’d never seen a start-up business plan that hadn’t turned out to be a work of fiction and the only truly valuable business advice I’d received had come from other business owners.
An organic way to grow a business
Dr Ernesto Sirolli was globally well known when I was introduced to his work but it was some years later that he became a megastar thanks to his 2012 TED talk- “Want to Help Someone? Shut Up and Listen”. The video of this talk has exceeded 2 million views on YouTube.
From the moment I understood Dr Sirrolli’s work and his principles behind how to help people to find the resources they need to start businesses and make them thrive, I realised most UK enterprise support, except in the Highlands and Islands of Scotland, was not fit for purpose.
There are 3 principles which underpin the Sirolli approach to economic development through business owners:
- All effective development ideas need to come from local people rather than ‘experts’, no matter how well-meaning or informed these experts might be.
- Most efforts to motivate people are fruitless; rather, those trying to help local enterprise must wait until entrepreneurs ask for help, then connect them with the resources they need.
- Entrepreneurs should never be encouraged to act in isolation on their dreams because doing so will increase their chances of failure and cause them to question their own capacities.
The trinity of business success
In all three of the above principles, I believe value-adding business partnerships are crucial. Sirolli confirms the need for partnerships and connections when he says he has never met a business owner that could do really well – ‘beautifully’ – all three of making the product or service, marketing the product or service and financially managing the enterprise.
Most successful business owners I’ve met are passionate and very good at the product or service part of their business and often, not so good at the marketing and financial side. All three need to be done very well to succeed.
The simplest one of the three essential activities – product/service, marketing and financial management – to find an appropriate partner for is financial management. In my case, this was Clare and for many of my friends who have been in business for decades, it has been another director, key employee or professional bookkeeper.
It’s proven that if the new or existing business owner concentrates on what they’re good at and they make deals with others to work with them on the things they’re not good at, they will succeed in growing their business. As long as they all do it ‘beautifully’, as Sirroli says. In other words, the ‘partner’ you choose must make 2+2 = 5 and not 4.
My friend, Paul Lancaster, who produces our annual #MicroBizMatters Day is known as the Super Connector in the North East. What he does is make 1-3 above happen by putting partnerships together in the tech sector. Jenn Crowther, CEO of Yorkshire in Business, which I co-chair, does the same thing for hundreds of small and micro business owners, each year, on the Yorkshire Coast.
Birth of a campaigner
Sirolli’s work turned me into a campaigner. Most of what government, the media and business schools were doing to support start-ups was ineffective and in many cases led to debt and depression. Sirolli’s method fitted with what I’d learned from successful business owners, my concept of ‘going with the grain’, EF Schumacher’s “Small is Beautiful” and the work of my favourite psychologists and philosophers.
Most importantly Sirolli’s enterprise facilitation worked in practice. Government programmes were ‘paternalistic and patronising’ (Sirolli’s words) and do not work in practice. It’s about helping people to do what they want to do and what they’re good at. The first questions to a new entrepreneur should be ‘What are you good at? What are you not good at? Who is helping you? Who is working with you? Who is supporting you?
I became a campaigner trying to stop the government from wasting money and damaging business owners’ livelihoods through their patronising, ‘picking winners’ start-up and scale-up programmes. I became a campaigner trying to ensure government only intervened in economic and enterprise development where there is a market failure – such as with #PayIn30Days and reducing the cost of regulatory compliance. I campaign for communities to invest in enterprise facilitation rather than experts, coaches, trainers, advisers and mentors.
If the output of the government programme for a start-up or scale-up is a business plan or a successful pitch for funds then the programme probably will not lead to a happy, fulfilled and successful entrepreneur.
Being a campaigner takes up most of my time and there’s absolutely no money in it – but, like promoting the work of Dr Ernesto Sirrolli, it’s the right thing to do.
Through research, including thousands of interviews with business owners, our team at one of the organisations I founded – SFEDI – were able to show that after 3 years existing business owners knew more about successfully running their businesses than the experts telling them that they were doing it wrong!
As importantly, connections and partnerships were usually more vital for survival and growth than learning new business skills. Sirolli had nailed it.
Avoiding the bad and the ugly – my top 3 partnership tips
- Complementary skills, passions and resources will be what you need to grow your business not ‘another you’. Antony Chesworth, who is celebrating 17 years, since founding the UK’s most popular online shops service – EKM – said in a recent blog that he spent 2 years hardly getting any customers for the platform he’d built until he learned telephone selling. That’s a very brave and excellent way Antony solved the problem of a great, distinctive product and service but no customers. Still, his subsequent growth, to having 90 employees and a fabulous HQ to host the next #MicroBizMatters Day, has come from knowing what he needed on product/service, marketing and financial management and recruiting the very best talent to do all three. Another way of doing it in Antony’s early days would have been to find another freelancer or new micro indie business owner that understood online shops, maybe one of his early customers, and was brilliant at telephone selling. Offer them a great cut of the value they bring in – make it more of a business partnership – help get them, clients. Clare and I did this with a recruitment business, for a year, which gave us all our initial clients and a graphic design business starting up at the same time as us – still friends today. Eventually, we found out what we needed to recruit into our business too.
- A partnership is not the same as buying a solution. Most startups given lots of money will blow it on developing the product, service, shop, restaurant or whatever it is that they’re passionate about. If they haven’t done enough test trading or practical research they won’t know what they need when it comes to marketing and if they don’t know what they need they’ll waste even more money on marketing staff or contractors. It’s not good enough to get an average supplier either – your business needs to be ‘beautifully’ distinctive – excelling in product/service, selling/marketing and financial management – particularly, cash flow. Partners are likely to be people you can’t afford to buy but will enjoy the challenge of you helping them and them helping you. It’s why family and friends are often the sources of great partnerships in the early days. Remember, with a partnership 2+2 must = 5 not 4. Chris Percival, one of Britain’s most successful entrepreneurs and still under 30, credits the skills and resources that his Mum and Dad brought to his fledgeling, paramedic and ambulance business. Chris has fully resourced fleets of ambulances and thousands of employees in many countries today and his Mum and Dad are smiling too as they have a share in the business.
- Trust, shared passions and values are important. One of Sirolli’s wonderful true stories is of five Australian fishermen working together to sell their fish at a higher profit. As individuals, they were struggling and all they knew was how to catch fish. Through Sirroli’s enterprise facilitation they found out the solution was to learn how to prepare tuna to be superior grade sashimi and supply it to Japanese restaurants at ten times the price they’d been getting before. It took many ‘partnerships’ to make this a successful business venture – each partnership was a win-win, primarily because of shared values. The two partnerships which went badly wrong in my businesses were both due to our partners not valuing the work we were passionate and proud of doing. These partners would do anything to make money. It was a disaster. Since then, we’ve always stuck to people that our friends or family can truly recommend and we’ve tested the water before making a deal with any new ‘partner’.