So, the Final is over; the winner declared. In the end, it was the business plans that were paramount, but the journey, over the last twelve episodes, was also important.
I want to use this final Apprentice 2012 blog to consider the reasons:
why Lord Sugar was right.
But first letï¿½s review who the four finalists were:
Strong manager, strong salesperson, creative and forceful.
Weak strategist with a background in direct marketing.
Calm, assured, conciliatory and a strategic thinker.
Backs away from confrontation, heï¿½s already a serial entrepreneur.
Combative, persuasive team player
A serial survivor with little spark of creativity, from a professional recruitment background
Suave, calculating, strategic and risk-taking
Not creative, but has founded and grown a multi-million business by 23
Weï¿½ll look at the business plans ï¿½ and why Lord Sugar was right to reject or accept them ï¿½ in the order that he made his final decision.
Jade, with a direct marketing background, played to the industry she knows, and pitched ï¿½the UKï¿½s largest telemarketing call centreï¿½. Her business would take opt-in marketing prospects and qualify them for services in a select few, carefully chosen industry sectors. Set aside all of the fun of the interviews, there were three big flaws in Jadeï¿½s business plan, each of which should have seen her off. The third, however, was overwhelming.
- No cash flow nor balance sheet projections
This is a fundamental error, that shows a lack of deep understanding of the business
- High risk start-up, with all of Lord Sugarï¿½s ï¿½250,000 committed to set-up within the first six months, then no operating cash, beyond what the business earns. What if it takes longer? How about a less risky, slow start?
- Fundamentally, I think Lord Sugar agreed with Claude Litnerï¿½s gut reaction to the business as sordid. Cold calling to residential numbers, whilst perfectly legal when done within the many data protection and Ofcom regulations, is not a business we all love and the owners of these businesses are usually anonymous. Lord Sugar would not want to be associated with something he described as ï¿½a business that phones people up and angers themï¿½.
This was not a business for Lord Sugar and so, rightly, he fired Jade.
I confess that, by the time we got to Sunday night, I was rooting for Nick. When I heard his business model, my heart sank. He wanted to create a complex web-based service that allowed users to select an online recipe and dump the full ingredient set into the shopping basket of their favourite supermarket. As a simple button, rather like the ï¿½Pin itï¿½ one at the foot of this page, it could be a useful service, but Lord Sugar was put off by three things:
- Getting complex software right can create a money pit of epic proportions. Something US Venture Capitalist (VC) can be prepared for, but not Lord Sugar with ï¿½justï¿½ ï¿½250,000 to invest. He is learning the hard way (again) about getting modern software right with his current involvement as Chairman of YouView.
- Nick had an over-blown and unrealistic vision of how much it would be used, how much money it could make and the scale of its impact: ï¿½it could replace Googleï¿½. Such fantasy is not a desirable trait in a business partner.
- I donï¿½t think he saw the market and, neither, I think, do I. If it does work, it becomes easy to replicate, and if it doesnï¿½t, there is a lot of software development in yet another failed internet start-up.
I was disappointed. A creative idea yes, but with too little consideration ï¿½ although we have to accept Nickï¿½s claims to have built a working prototype as impressive. I donï¿½t think people would use it as Nick believes, but it could make marginal income as a convenience ï¿½ maybe even a lot of income if it takes off, but it is just too risky, with too much development risk and too little adoption certainty. Lord Sugar was right to advise him to got to the US in search of VC funding on the Youï¿½re Hired show, and right to fire Nick.
Tom looked good throughout the final ï¿½ right up to the point Lord Sugar made his decision. Tomï¿½s business plan was a polished analysis of how to create a fine wine investment vehicle: a hedge fund of ï¿½25 million. Lord Sugarï¿½s advisors accepted the analysis, but this plan was pure Tom: rooted in his successful business ï¿½ one about which he is passionate and that has shown huge success, yet a huge risk. Tom has already had to turn down enquiries and his demeanour and track record must have made this very tempting t Lord Sugar. But in the end, he had to weigh:
- Potential huge returns in an exciting business, with a highly talented business partner
- Huge risk if the business failed: both financial and reputational ï¿½ he may be able to shield the former, the latter; less so.
I could detect that Nick Hewer was sort of pressing Lord Sugar in Tomï¿½s direction: ï¿½one last hurrahï¿½. And Lord Sugar has taken his share of business risks. But he also likes simple business models. What made his mind up, however, was simple, clear, and admirable: Lord Sugar has always taken risks with his own money, and not with other peopleï¿½s. This would be different and he did not feel comfortable with that. So therefore, he was right not to hire Tom.
I really do think, however, there is an investor out their who wants to create the sort of business Tom put forward. They will like what they have seen of Tom. I suspect, either with or without that investment (Tomï¿½s business is profitable), Tom will launch some version of what he pitched to Lord Sugar in the next 24 months.
Ricky offered a well-thought out plan for launching a recruitment agency for pharmaceuticals, biotech and other scientific professionals. It is what he knows and does so well outside of this process. It is a straightforward business on a well-established template and Ricky is passionate about it. It was the ï¿½safe optionï¿½ but never believe that starting any new business is truly a safe option. What makes it safe is that Rickyï¿½s plans were well drawn, he clearly excels in this arena, and he is committed to the business.
Lord Sugar may not see the stellar growth that Tomï¿½s business might have delivered him, but if Ricky manages it well, it will deliver secure returns for him.
And letï¿½s not forget that one of the most impressive entrepreneurs of our culture, and number 869 (worth ï¿½85m) in the Sunday Times rich list, is James Caan, who made his fortune founding Alexander Mann, a recruitment business.
If Lord Sugar felt comfortable with Ricky as a business partner, then this was a first class opportunity.
And he clearly did, so he was right to take Ricky Martin as a business partner.
Why Lord Sugar was right to Choose Ricky Martin
Rickyï¿½s swagger and braggadocio was well-illustrated by the crassness of many of the statements in his application papers. But, in his own words, he is ï¿½a very different person nowï¿½ having gone through the process. And this is important. In Smart to Wise, I identify seven pillars of wisdom. Letï¿½s see how Ricky measures up.
Ricky has not yet totally mastered his need to boast, but he has done two things that matter: he has acknowledged that this is not a helpful approach, and made great strides to curb his habit.
Ricky has shown throughout the process that he can perceive what is important and has often correctly diagnosed a situation.
Along with Adam Corbally, Ricky evolved most through the 12 weeks that we saw him. He learned lessons from the situations he was in and from Lord Sugar, Karren Brady and Nick Hewer.
Ricky always sought to conduct himself professionally and his demeanour has always been respectful of others, yet forceful. As he learns to be less combative, he may have a very strong business presence.
In developing such a highly praised business plan, he gave Lord Sugar good reason to trust his judgement.
Iï¿½ll pick an instant that I really respected: when Stephen Brady was laying into Gabrielle Omar in the boardroom (a disrespectful trait of his I deprecate), Ricky calmly and confidently told him to stop.
Ricky has chosen a business plan that addresses his core business credibility and will let him speak and act with authority.
I have, on a couple of occasions, argued my disappointment that none of this yearï¿½s candidates were exceptional individuals. I am beginning to wonder if I should not exclude Tom in from that analysis ï¿½ I have been very impressed with what I have seen in the final. I donï¿½t demur from that conclusion, however, for the winner. Ricky strikes me as a highly talented individual with the knowledge and determination to succeed ï¿½ like many talented people.
But this does not take away from the single salient fact of the final:
Ricky was a worthy winner. He survived the process. He offered the best business plan. He convinced Lord Sugar he can deliver it.
Congratulations Ricky Martin.
Smart to Wise
It is a gorgeous little hardback, packed with ideas and information.
Learn more, and read article about wisdom, at:
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