Q: How do I win the trust of investors, future partners and suppliers?
A: There are few things more important in business than trust. After all, if potential customers do not have faith in your product or service, then your business will never get off the ground.
And it’s not just customers you need to win over; almost everyone your company works with, from manufacturers to distributors, will need convincing.
This isn’t the easiest act to pull off, especially when you’re starting out and have little to back up your promises. Without a recognised brand or a history of successful trading, entrepreneurs and start-ups have to use other techniques to get a business going.
For one, it’s vital that you show people from the start that you’re different from the competition – you need to stand out. I learned this when we were signing acts to Virgin Records and we needed to gain the trust of the musicians we were chasing.
When the Rolling Stones were looking for a label, we needed to convince them that Virgin was the place for them. I knew that we were getting somewhere when Mick Jagger commented that I was more like him than the “suits” from the other labels who had been courting the band.
That was nice to hear and it was also, I thought, a fair reflection of my approach to business. I wasn’t making big promises or telling bands what I thought they wanted to hear; I was being honest about who we were and what we could do, and so artists trusted us.
That honesty allowed us all to treat the artists more like friends than clients. Our team did not present a buttoned-up, united front when we were working with them; instead, everyone pitched in, contributed their opinions and did their very best.
When we were looking to sign Janet Jackson and negotiations weren’t going as smoothly as I’d hoped, I was able to use humour to persuade her. I thought she was a fantastic artist and would be a real asset to the label, so one day I arranged for us to take a trip in one of the Virgin hot air balloons, where we continued our talks.
As we returned to the launch site, I decided to play a joke on her, and quite cheekily said that we wouldn’t land until she signed with Virgin! She laughed, and did.
As we entered other industries, some of our team from Virgin Records joined those new businesses, and honesty and humour became part of our company’s DNA. And this approach became our calling card as we started businesses in sectors that needed shaking up, where customers were receiving a bad service.
We were very blunt with customers and competitors about what we were doing and why – our good intentions were obvious to anyone who cared to look.
At this point, people who are thinking about investing in Virgin companies need only look at our track record: We run good businesses and make FAIR profits. To reach this point, a company first has to do the hard work of laying down the foundations that will enable a business to flourish in the long term.
Whatever your business is and no matter how you operate, you need to determine what will set your company apart and then execute perfectly according to those simple fundamentals.
You do have to keep sight of those basics – in our case, a straightforward business proposition, great customer service, and a touch of humour – because customers will quickly lose trust in your brand if you don’t.
At the same time, you must remain flexible, making room for new developments along the way. Look for ideas that will set you apart from the competition. Everyone likes to be pleasantly surprised, so keep your customers on their toes by occasionally doing the unexpected, and that can put you ahead.
When you’re trying to persuade partners and suppliers to work with you, throwing yourself wholeheartedly into finding solutions and compromises that will allow you to work together is a great way to demonstrate how serious you are – people will sit up and take notice.
In 1997 after the British radio host Chris Evans had just quit his job with Radio One, I decided that he would be perfect for Virgin Radio, so I phoned his agent to arrange a meeting.
His agent told me that Chris was about to depart for New York on a British Airways Concorde flight, and if I wanted to meet with him I’d have to get on the plane. At that time, the idea of getting onto a British Airways plane was almost anathema to me, after the way they had tried to put Virgin Atlantic out of business, using all sorts of underhanded tactics.
When I hotfooted it over to Heathrow and walked past astonished British Airways staff and onto the plane, Chris knew that I was serious about doing business with him. (Later, he bought Virgin Radio from my team.)
Building trust in your brand isn’t easy to achieve and it may take time, but it doesn’t have to come at a high cost. With honesty, ambition, hard work and attention to detail you can instill a level of trust that will enable you to move forward.