Doug Richard is as fiercely alert, bright and blunt in the flesh as he was on the BBC’s surprisingly successful Dragons’ Den business series. However, perhaps what the series didn’t convey is the fact that off-camera he’s a far more jovial character, with a dry wit and a passion for business and innovation that is almost childlike in its intensity.
This infectious enthusiasm is probably what has enabled him to successfully develop a clutch of technology ventures both here and across the pond. The latest in this long line is Library House, which he founded in 2002 and where he currently sits as chairman.
Before our interview has even begun (and just after he has cracked a few jokes) he has launched into a bullish monologue on why Library House, a comprehensive database profiling technologically innovative companies in the UK and Europe, will thrive.
‘Library House is the first port of call for investors on the lookout for exceptional investment opportunities. A listing on its database can dramatically boost an entrepreneur’s ability to get in front of key angel investors.’ Without pausing for breath, he tells me the business is apparently, ‘on a tear, growing as fast as it can grow’.
According to Richard, he spends around 70-90 per cent of his week with Library House, with his remaining time devoted to Cambridge Angels, an investors’ organisation that he founded back in 2001 and which has been responsible for a large number of the ‘Cambridge phenomenon’ success stories of recent years.
The virtuous cycle of success
Richard’s history is littered with corporate triumphs. He was President and CEO of US-traded software outfit Micrografx, which was sold onto Corel Corporation in 2000. Prior to that, he was the CEO of Visual Software, which was set up with the mission of bringing 3D technology to the PC market in the form of creativity and productivity software. Visual Software was sold to Micrografx in 1996.
Before Visual Software, Richard founded ITAL Computers. ‘My first company,’ he reflects with an affectionate smile. It was not only the first company, but the venture that kickstarted his business career, as it was the proceeds from the sale of ITAL (which provided CAD/CAM systems integration services to the California aerospace sector) which were used to found Visual Software.
Build jobs for exceptional people
Richard’s first rule of thumb when building a business is a bit of advice that I’ve heard many leading businessmen and women utter. ‘Never be scared, as an owner, to hire people that are better than you are,’ he urges.
To this staple nugget of knowledge though he has added his own unique rulebreaking spin. ‘By hiring exceptional people, you’ll be standing on the shoulders of giants. But remember, great people don’t come along every day. If I spot one, I’ll build a job for them, rather than let them walk. I’ll ask myself, how do I redesign the business so this person can be in it?’
Radical opportunism is king
His other staple rule is to avoid saying no in a business situation. ‘One of my entrepreneurial characteristics is that I’m a radical opportunist,’ he claims. ‘In business, I learned very early on that you just don’t say no. You say yes, or maybe, or let’s go and have a coffee, but never just a no. I’m always open to a conversation.’
‘For instance, I’m more than happy to sell someone something before I can deliver it! I call it growing into my brand,’ he teases. ‘When you never say no, you give yourself a shot at winning.
‘With Visual Software, we got to market with a 3D technology, before the PCs were actually ready for it. When they were ready, we showcased our technology by building a demonstration kit for a stand. Even though it wasn’t a product yet, we told people that it was. Did I have a product or a price? No. But by the end of that show, we’d booked orders. And that went on to become the company, selling 3D technology applications to the PC market.’
Make noise, break rules!
Richard also flirted with aggressive marketing in his Micrografx days. ‘We wanted to get our graphics software title FlowCharter on to people’s play lists, so we hired an independent firm to say FlowCharter was superior to our rival product.
We bundled this up into a white paper and put together an ad campaign in PC and software magazines saying, ‘independent analysts say FlowCharter is better.’ We even sent that report to the rival CEO! Don’t be afraid to break the boundaries of what is deemed acceptable. Get out there and make noise – break the rules.’
Richard’s ‘unswerving’ investment rules
His tendency towards the maverick has coloured his approach to investing at Cambrige Investors. When his group invests it needs to have ‘faith’ in the entrepreneur it backs and a strong ‘belief’ in the innovative qualities of the business. And of course, there has to be a real market to exploit and good terms for coming on board.
‘These are really the only things to be considered, and every angel considers them whether he knows it or not.’
Richard places most emphasis on the importance of the entrepreneur. ‘If he/she doesn’t have the right attitude, I won’t invest. I have to believe in the entrepreneur because the unexpected will always occur and they have to be able to adapt.’
Unlike some, he also weighs up the time he can devote to a company. ‘Your biggest restriction as an angel investor is your ability to time-slice,’ he muses. ‘I’m never a passive angel. I’m very exit-oriented’, he wryly smiles. ‘ROI is key for me.’
The first UK firm that received his unique take on angel investing was Designer Servers, a Manchester-based company that was eventually sold to Business Serve (a communications provider now quoted on AIM). ‘That was a clean transaction, really a model for angel investing. I put in a small amount, spent one full day with them every two weeks, and I was the only investor in that business, ever.’
As for his TV investor career, it speaks volumes about his approach to life that he is already speaking in boastful terms about Tracey Graily, the lady who runs women’s made-to-measure clothing company, Grails. ‘She’s one heck of a lady,’ exclaims Richard, who invested along with his fellow dragon Rachel Elnaugh (the founder of Red Letter Days). ‘The company’s off the ground and it’s out there in the market – so far so good,’ he reflects.