The joy, sadness and fear of selling up
First published in the Financial Times on the 19th March 2013.
The pain of parting can be eased by moving on to the next big thing
I sold a business called Giraffe, the popular, family-friendly restaurant chain, last week. Letting go is often a bittersweet experience and in this case especially so, since I had been chairman and co-owner for nine years and seen the company expand 10-fold during my involvement.
Moreover, it was a fabulous journey. We created hundreds of jobs, paid plenty in tax, enjoyed the ride and gave untold thousands of diners a lot of pleasure.
It is undeniably always wonderful to get a big cheque, and according to certain criteria that is the point of it all – to bank a profit.
But as one serial entrepreneur once told me, after the first time you receive a decent slug of money, the thrill fades. Indeed, many business owners suffer seller’s remorse. I certainly have.
After I sold my PizzaExpress shares and stepped down from its board to take on other restaurant projects, I felt a kind of bereavement.
Still today I have mixed views on the rare occasions when I eat in one: a touch of pride combined with a little regret that I am no longer part of a classic institution – and many fond memories of what was, for me at any rate, a life-changing venture.
After all, if you scratch the surface, most entrepreneurs are no good at spending money even when they make piles of it. More often than not, they will admit that the defining moment of their career was not cashing out but actually building a successful enterprise – assembling a winning team, serving customers well, besting the competition and gaining the admiration of their peers. These are the activities of a founder.
By contrast, leaving is a farewell, a reminder than nothing lasts for ever, that with each departure a piece of us is gone for good.
The other emotion I feel when selling a great business is fear. I am always afraid that I will never find another asset to replace it, another interesting undertaking that will engage me.
The world is full of second-rate businesses, and becoming a partner in a really good one is hard to do. It is easy to fool oneself into thinking a new proposition is high-quality. But such opportunities are rare – most situations are inferior, while growth is difficult and profits elusive.
Giraffe was a particularly gratifying adventure because I worked alongside highly professional partners, the founders Russel and Juliette Joffe, who made it fun as well as lucrative. Of course, not everything we did together was perfect, but mostly it succeeded – and I felt lucky to be a part of it.
My partners were constantly challenging and sometimes demanding – but these are necessary traits if you want to construct a real business from scratch. That is why the company of entrepreneurs is so invigorating: they do not simply accept the world as it is but see potential – and proceed to act by making that vision tangible.
A highlight of my years at Giraffe was the annual staff awards – the so-called Goscars. A couple of years ago, the MC read out a marvellous letter from a customer who regularly brought her disabled son to our Hampstead branch. The writer explained that Giraffe was the only restaurant her son ever went to because the staff always recognised him by name and treated him like a VIP. I felt privileged to be part of the Giraffe family when I heard that story.
The sale process had its moments of drama, as is normally the case. Emotions are apt to run high when the numbers are big and individuals have invested so many years of their lives in a venture that is about to change hands.
Part of me didn’t really want to depart but I realised the offer price was attractive and that it was the right step in the evolution of the business.
The company has been bought by Tesco, the huge UK-based retailer. I hope it treats its acquisition well and preserves the culture. It must try to retain the hundreds of decent employees who make it innovative and exciting. Luckily, the founders are staying on board.
Meanwhile, I am going back to the drawing board, resuming an endless search for the next big thing. If I find another opportunity like Giraffe, I shall be fortunate indeed.