September 16, 2011 10:03 pm

Start It Up

An outpouring of useful knowledge gleaned from years of investment experience Luke Johnson does not hold back

If you like hearing it told straight, then Luke Johnson’s Start It Up could be for you. The book is part rant, part outpouring of useful knowledge gleaned from 20 very successful years in business – and fortunately, someone forgot to send the text to the Political Correctness department before it went to press.

Johnson, an entrepreneur and chairman of private equity firm Risk Capital Partners who also writes a column for the FT, has a business approach that I suspect is not classic Harvard. Meetings are a waste of time (“magnificent engines of bullshit”); don’t bother with an HR department (“a burden on the backs of productive workers”); staff nick things (“sooner or later there will be a thief on the payroll”); and forget the corporate social responsibility report (“whatever that is”). One could never accuse Johnson of holding back. But one admires his honesty, even if not always agreeing with his sentiments.

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Start It Up is subtitled: “Why running your own business is easier than you think” – but it convinced me of the opposite. The book is interspersed with anecdotes of business failures, missives on how wealthy entrepreneurs spoil their children and other cautionary tales. I now go into work at my own company with a heightened sense of the possibilities of financial ruin, becoming a terrible parent and spending the rest of my life sitting at home in front of the television drinking cheap gin.

But there is a great deal here that is good and which the subtitle doesn’t convey. For budding business angels, Johnson condenses 20 years of investment experience into two pages of useful and comprehensive criteria for choosing companies to invest in. The book also passionately articulates the transformational role that entrepreneurship plays in society, and how the large majority of new jobs are created by start-up companies, not established ones. Johnson’s simple but important insight is that if we want growth in the economy we need more entrepreneurs, and the UK could do more to create them. On this point alone, Start It Up is essential reading for politicians. We can’t cost-engineer our way out of recession.

Collectors of soundbites will have a field day. The book is peppered with the wisdom of the great and the good; everyone from Socrates to General MacArthur speaks up at some stage. Warren Buffett’s “the internet isn’t going to change the way people chew gum”, uttered as he invested in Wrigley’s at the height of the dotcom boom, stuck with me. As did McDonald’s founder Ray Kroc’s “Press on. There is nothing in the world to replace persistence.”

Beneath all the rough language and tough advice, you can tell Johnson is really an old softy. He ends the book with a chapter on why to be an entrepreneur. Starting a company, he believes, is a creative endeavour that can nourish the soul; it is the best way of controlling your own destiny and changing the world, of creating jobs and upsetting the status quo. And on all of those points I could not agree more.

Richard Reed is a co-founder of Innocent Drinks

Start It Up: Why Running Your Own Business is Easier Than You Think, by Luke Johnson, Viking, RRP£12.99, 256 pages

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