Jeremy Harbour epitomises the oft-quoted start-up mantra “Fail fast, fail often”. When he was 15, he dropped out of school. At the age of 18, he owned a fast food takeaway joint and an amusement arcade, both of which failed “spectacularly”. But the key, Harbour emphasises, is to be able to fall flat on your face, stand up, dust yourself off and not repeat that mistake again.
In the decades to follow, Harbour would buy multiple troubled companies for a song, revive them, scale them upward, and sell them later at a profit. Today the school dropout and world-renowned expert in mergers and acquisitions is in another business – helping SMEs to scale up as Chairman of The Marketing Group. The reason? He strongly believes that the next change in the global economy starts from the ground. Harbour tells us more.
“The financial system has gone rogue. The power to create money out of nothing has been taken to a whole new level and global capital is sitting in real estate, commodities, stocks, bonds and derivatives.”
How do you think the economy of the future will be like?
The future success of any economy is inextricably linked to its success at promoting small businesses. And of course, the digital economy is changing the future of business whilst the idea of the sharing economy has broken barriers and forced change by responding to social trends and this is really, really, exciting territory. We are seeing more and more micro-entrepreneurs and in turn an increasing number of SMEs competing for their market position. The enabling of these businesses is going to be key.
Agglomeration, which addresses the key challenges small business owners face – scale, succession, demographics, liquidity, value creation and global expansion – is going to define the future of business.
Tell me more about agglomeration, or “democratisation of wealth”.
It’s about empowering people to make a difference. Separating the managing of the work, from the doing of the work. Today’s multinational business groups and people controlling the wealth – our governments – need to stop acting like employers and offer people a chance to thrive and grow in a meritocratic environment, so if they work hard, they are rewarded, they are given responsibility and trust and they grow as people.
If you let people create value with reward then this has a huge societal impact. If you made dozens of new millionaires in every city, you would create a boon for philanthropy and local economic development. You also create inspirational leaders for the next generation, so instead of the money sitting in hot sandy places doing nothing, it will be poured into communities of real people and deliver real impact.
Are you saying what I think you’re saying?
Yes, I believe that we can gradually ignore governments and the whole finance and advisory industry. If we empower the SME space, we can solve issues on a local level, reduce poverty and inequality and create an example. Instead of holding out a hand to government, you are far better rewarded for taking individual responsibility.
Why do you think the global economy is broken?
The financial system has gone rogue. The power to create money out of nothing has been taken to a whole new level and global capital is sitting in real estate, commodities, stocks, bonds and derivatives. I believe money is now detached from value and wealth is disproportionately sitting in the hands of a few. There needs to be a change in the way business is done. And there is a huge opportunity for small businesses to drive this change and transform the economic landscape.
SMEs represent 50 per cent of GDP and 98 per cent of private sector employees, in most developed economies. The great thing about the modern business landscape is that anyone can start a business and make a difference – but there is not the pot of gold at the end of the rainbow that used to exist from a straightforward exit. SMEs can succeed and prosper with a disruptive business model – Agglomeration – that provides access to global capital markets, expert talent and the opportunity to scale.
You’re definitely not the typical businessman. Tell me more about your background.
I was the annoying kid at school trying to sell you stuff. At 14, I ran a weekend market stall. At 15, I left school to pursue that business, which ultimately ended in failure. At 18, I started again. I finally found my feet building a telecoms company. I used to say that my biggest competitor was apathy, as no matter how cool you felt your differentiation was, at the end of the day, it just didn’t really matter to customers. So, I slowly taught myself how to do deals, buying and selling companies, and because I had no money, I learnt how to do deals with no money. I then realised that doing deals is like business, without the staff and the customers. So I became a full-time deal junkie. And after doing lots of buy, sell and advise type deals, learned where the problems are in business.
It’s frustrating that in movies the bad guy is always the businessman! Thanks to the way some multinationals do business, every successful entrepreneur has been tarred with the same ‘bad guy’ brush. When governments try to make the business environment better they focus on old school corporate thinking. If we can get governments and multinationals to think differently and truly invest in helping SMEs – by allowing SME entrepreneurs to scale and evolve whilst retaining 100% control of the business they started – then we can start to change the global economy.
What is your business mantra?
I heard a great saying recently, “The light bulb wasn’t invented by continuously improving the candle.” That sums up agglomeration. There needs to be a remarkable transformation in the way global business works.