AN ENTREPRENEUR WITH IMPACT. Brent Hoberman is Co-Founder and Chairman of Founders Factory, Founders Forum and firstminute Capital. He co-founded lastminute.com in 1998, was CEO from its inception, and sold it in 2005 to Sabre for $1.1bn. He also co-founded Made.com which went public in 2021 for $1.1bn.
You can listen to the podcast of this interview here.
Brent Hoberman, you went to Eton and Oxford, but you were born in South Africa and you say that your mentors were your grandfather and your father. What did they teach you?
My mother’s father founded the clothing retailer Truworths. He took over one shop from his uncle and turned it into 650 across Africa as well as a small chain in the UK. For me, it was seeing somebody who loved what he did so much every day: being his own boss, building something from nothing, having a team he enjoyed working with. He was passionate about what he did. Our family was full of histories of amazing things that he’d done, and he was very well respected in South Africa. My father was the son of a South African lawyer. He left South Africa early on, advised by that same grandfather that South Africa didn’t have much future. He went to MIT and then worked in New York, putting pension fund money into venture capital funds, first for the Ford Foundation and then for Alliance Capital. He was at the beginning of the venture capital industry as we know it today, and it was exciting for me to learn some of that by osmosis.
Is it true you were fired from your first job?
Yes, I was at the strategic consultancy Mars & Co., where the culture then was one of fear and not trust, and I wanted to launch a business of putting free magazines into taxi cabs to gain them high circulation. To get it done, I needed to meet the people who regulate taxi cabs at the Public Carriage Office. When I told my boss I had a meeting in a month’s time at 8 a.m., he deliberately organised a client meeting with Elf, the big oil company, at that time even though I was so junior that I never actually had client meetings. He said I had to do this and I said no, so I got fired, but as I left that meeting there was a voicemail from Spectrum Strategy Consultants offering me a job. I ended up starting there next week in that wonderful strategic media and telecoms consultancy firm, where I was paid to learn about the internet in 1996.
One lesson from your grandfather was that you need passion to succeed, but is passion in entrepreneurs enough?
Passion only works when it’s combined with other things. An infectious passion is one way you can get other people excited about your vision, and the passion that I look for in the entrepreneurs that we back is where it means that they are going to attract and retain amazing talent. That’s the first thing, but the next thing to ask is “why now” for that idea. And then it’s “why them” in that team or that person, are they a great fit for what they are going to build. Also, do they understand their own limitations, and are they savvy smart.
“I look at entrepreneurship in a philanthropic way.”
Brent Hoberman at the Founders Factory headquarters in Northcliffe House, London (c. 2020)
Brent Hoberman, how did you make your first million?
I started lastminute.com in my late twenties. We launched in ’98 and we went public after 18 months, in March 2000. It is still the fastest that any company has ever gone public in Europe from launching as a product. The IPO (Initial Public Offering) was 43 times oversubscribed, and then went down 95 percent when the dot com bubble burst.
What was lastminute.com?
Lastminute.com was the reference website for consumers; if you were going away, going out or staying in, it enabled you to do everything at the last minute. You could book your spa treatment or your restaurant booking combined with a cinema ticket, and of course you could book your holidays. It still exists today, publicly quoted on the Swiss exchange. We sold it to Sabre; they then sold it on to Bravofly Rumbo Group.
What did you do with the money?
I didn’t do very much with the first money that came in from the IPO, the key thing was what was left in the business. We sold the business for $1.1 billion in 2005, back when that was real money. I only had about 5%, but it was still more money than I ever dreamed I would make. In fact, money was never the objective. It’s a wonderful and very lucky side effect. The best entrepreneurs start in order to solve a problem and to change something because they love what they’re doing. They make money on the side because they’re so passionate and excited.
You then created another company, Mydeco.com?
Mydeco came about because, on selling lastminute.com, my wife thought we should play out a few scenes from the film Brewster’s Millions and said “let’s buy a prime house in London and a house in St Tropez”. Those were lovely side effects, but doing that, I realised how inefficient the furniture market was and how I, like 50% of people, couldn’t visualise interiors. After travel and leisure, the home is a huge sector, and one that I wanted to go after. Mydeco.com might have been my best idea, but didn’t really work that well because the DNA of the team wasn’t quite right. I spun out another simpler business from Mydeco called Made.com which is furniture direct from factories to consumers. Made IPO’d last year for $1.1 billion.
You are the co-founder and executive chairman of Founders Forum and Founders Factory and firstminute Capital and another company called Karakuri. How did these come about and what are they?
One of the things I most enjoyed about lastminute.com was being relevant, and also the privilege of meeting other entrepreneurs and interesting people across lots of different countries, and I thought let’s convene them all and see what happens when you put them in a room together. In 2005/6, we started Founders Forum which runs a series of events where we gather together the world’s best entrepreneurs, CEOs and leading investors. The flagship event is in the UK, but we also have one in New York and across the world, and have held forums across the globe, from Rio to Mumbai to Singapore. The key is that it was free for founders to attend, and not for profit, and that meant we could be selective in terms of getting the quality of the group to be the most founder centric. Founders Forum then launched lots of other things: a consultancy called Founders Intelligence, a recruitment business called Founders Keepers, and platforms for entrepreneurs to learn from other entrepreneurs called Framework. We’re going to launch Founders Law, Founders Brands and all sorts of other things.
“It’s important that when we talk to entrepreneurs they can see that we can really help them.”
Brent Hoberman, what is Founders Factory?
Founders Factory is a multi-sector incubator and accelerator for startups, backed by corporates like L’Oréal, Aviva, The Guardian, EasyJet, Johnson & Johnson. It is in multiple countries, and almost 300 start-ups have gone through it. A good example of an idea that we incubated from scratch is Karakuri. Initially it was my dream to launch a gadgety consumer-facing robot restaurant, but that ended up being harder to fund than the adaptation, which is robots to help make food in kitchens. Another big success from Founders Factory is a universal shopping app called nate. It moved to New York and is doing super well.
What is a robot restaurant?
It doesn’t really exist today, except in Asia, but imagine Benihana meets the Hard Rock Cafe with robots: a restaurant where robots wait on you, entertain you, cook and do everything. That’s still a dream. Karakuri has ended up being a simpler business, using robots to prepare food for quick service restaurants. One of our first investors was Ocado, and it has now raised about £13 million. It’s got robots working in the Ocado canteen and is now getting robots ordered by lots of big quick-service restaurants and canteens. I just handed over as Chair because I really like the early bits, and that business is already a little bit more mature.
And what about firstminute Capital?
firstminute Capital is a $300+ million seed fund. It’s never too early to come to us, we have backed people with just a business plan. It is European weighted, but we do global deals. It is backed by over 120 unicorn founders, and that’s not a vanity metric, it’s important that when we talk to entrepreneurs they can see that we can really help them. Our aim is to be the most helpful seed fund, in large part because we have a very bright and motivated young team of over 20 people, but also because we have this backing from these amazing entrepreneurs who have done it across the world. We’ve done over 100 deals in that fund. It’s a real privilege to be in venture capital, and fascinating working with people who are building the future.
You also sit on many advisory committees, including to government, to the Royal Academy of Arts, to Oxford University. You were also on the board of The Guardian and The Economist and other prestigious companies. Why do you spend your time doing this?
Impact is rewarding, and to leverage your time and have impact can sometimes be done effectively with boards, but I am no longer on any bigger public company boards where there’s too little time spent on strategy and too much on governance. I’m really interested in fast growth, in ideas, in people that implement them quickly, people that break boundaries. Advisory boards can be effective and I have been on various government advisory boards for four prime ministers in the UK. It’s a privilege to have that sort of access and because I am working so much with entrepreneurs at the cutting edge, and I’ve been doing it for a long time, I am able to bring a unique perspective. There’s no point advising if you feel useless, but if you feel useful and that there is some impact in your advice then it can be very rewarding and a good way to leverage your time. That’s why I still do it and enjoy many of those interactions.
Are entrepreneurship and education together somehow your fil rouge?
When I was leaving university, entrepreneurship was not something that was thought of as a career. I’m proud I entered the first ever Oxford University entrepreneurship competition. I look at entrepreneurship in a philanthropic way. The more people that are able to get hope, become entrepreneurs, make an impact, that will have broader benefits to society. At Founders Forum, we’re going to launch more and more things within the area of young entrepreneurs. We’ve done Founders of the Future, Creator Fund and the Oxford Foundry, and 01 Founders for software developers, and I’ve been on the board of Eton College and I was on the board of the University of Arts London as well. There is something super interesting in education. The recent events in Ukraine have shown us that where we take money from becomes something business people need more guidance on, and we need independence as much as possible from autocracies even as we need to have continued dialogue at every level.
Brent Hoberman & Martha Lane Fox in a lastminute.com-branded London taxi (c. 1999)
Brent Hoberman CBE & Baroness Martha Lane Fox of Soho photographed at the lastminute.com offices on Park Street, London for the National Portrait Gallery (November, 2000)
The Made.com team: Brent Hoberman, Chloe Macintosh, Julien Callède & Ning Li (2014)
HRH Prince William, Duke of Cambridge listens as British entrepreneur Brent Hoberman speaks during the final meeting of The Royal Foundation’s Taskforce on the Prevention of Cyberbullying during his visit to launch the national action plan to tackle cyberbullying at the London headquarters of Google and YouTube in King’s Cross on November 16, 2017 in London, England.
Brent Hoberman and Phillip Hammond (Chancellor of the Exchequer) & Brent Hoberman at Founders Forum, London (June, 2019)
Brent Hoberman speaking at Founders Forum 100 at Gleneagles, Scotland (September, 2021)
“I couldn’t see a way of doing my startup well without having my brain consumed by it at all times.”
Brent Hoberman, startup myths or realities have changed the view of young people vis-a-vis work, who don’t say they want to become the chairman of General Motors or of Barclays Bank over a long career. They seem to want to become rich easily and quickly, but is it prudent to encourage young people to think like this?
Too many people might think it’s too easy, but people want to leverage their time and impact more, quicker, faster. That’s a good thing. Startups are a great way to do that, and also to learn quicker. You learn by doing, and you do more and you get more breadth at smaller companies than being siloed earlier on. Those are some of the benefits, but the downside is that you are a prisoner of your startup business and people don’t realise that. I couldn’t see a way of doing my startup well without having my brain consumed by it at all times. That is good for some people and not for others.
Is it a different talent to be an entrepreneur than to become an important manager in a large company?
Great entrepreneurs tend to be mavericks that will take risks and also see the future in a way that other people don’t see it. Elon Musk and Tesla and SpaceX would be good examples, where other people don’t think it’s possible. It’s that Nelson Mandela quote: “It always seems impossible until it’s done.” Entrepreneurs are also often much more remarkable for their unbridled optimism than for their managerial rigour.
Is the rarer skill that of the general or that of the person with ideas and vision?
Good generals are incredibly important, but they are more fungible, more tradeable than that top leader. Which is why many of the world’s best companies today are still run by those early founders who have that initial vision and passion. What’s so rare is to find somebody who can zig and zag but also has that long term vision. A lot is about long term versus short term, and great foundational entrepreneurs will go to a long term target, whereas operational people are more short term and therefore probably easier to find. Nonetheless, of course great generals are incredibly valuable.
There is a big polemic in France about the salaries of managers. Some say that they make too much money, but what judgement is needed to decide how much money the important managers should make?
Here in the UK we started publishing the ratios of what the CEO makes relative to the average employee, but more interesting to me is that we’re in a globally competitive market and obviously U.S. CEOs are not judged in the same way. They make crazy numbers from betting with other people’s money, but if they are critical then everybody does win and that country benefits too. By putting too much pressure and public criticism on CEOs who are super well-paid, quite honestly we are encouraging the best talent to go to America, which is not good for the success of companies here. It’s an easy argument to make politically that you must pay CEOs less, however, another conversation that we aren’t spotlighting enough in the UK is that we underpay our politicians. It should be a full time job, and we need to pay them much more money.
At the end of the day, what is going to last?
What’s going to last is this massive shift of technology, changing and improving people’s lives everywhere globally.
What is going to change?
Maybe it is conspicuous consumption, materialism, and the outward show of wealth that puts the focus on inequality. Otherwise, our capitalist system of life, which I think is wonderful, will get more threatened.
What is going to end?
Not caring where we source capital from and not thinking about second order consequences. Business has more of a moral role to play, so I think business being immoral in the West is going to end. Hopefully.
Thank you very much.
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