A driving force at Aston Martin
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Twenty-six years ago, David Richards was a rally co-driver having his fillings shaken out on special stages. He hung up his helmet in 1981, but not until he had partnered Ari Vatanen, “the flying Finn”, when they became joint World Rally champions.
Today, the 55-year-old is in the “driving seat” of several challenging business projects, the latest being the purchase of Aston Martin.
Mr Richards is founder, chairman and chief executive of Banbury-based Prodrive. Founded in a small Silverstone workshop, it is now a multi-faceted motorsport and automotive technology business that had sales last year of more than $250m (£125m), employs 1,000 people, operates on four continents and is winning contracts in other sectors, such as defence and aerospace. It has taken Subaru to five World Rally Championships; BMW, Alfa Romeo and Ford to five British Touring Car Championships; managed the BAR Honda Formula One team and runs Aston Martin’s racing programmes.
Next season, Mr Richards will plunge Prodrive into the pool of the “piranha club” – the soubriquet for the hard-edged team principals of Formula One – with its own team. He is also immersed, alongside Aston Martin’s chief executive Ulrich Bez, in mapping out strategy for the sports carmaker, which Mr Richards and Kuwaiti investors recently acquired from Ford in a deal worth £479m.
He part-owns ISC, the commercial rights holder to the World Rally Championship; sits on Warwick Business School’s advisory board, is trustee to two benevolent funds, sits on various government committees and picked up a gong – a CBE – in 2005 for services to motorsport.
Now Ford wants to put Jaguar and Land Rover up for sale and he declines to rule out being once again among the bidders: no wonder the helicopter he keeps 50 yards from his office and pilots himself is intensively used.
Mr Richards says there were no dramatic turning points in his long journey from starting out in accountancy. “It has mainly been a series of small steps that turned out to be significant,” he says.
Having decided to make commercial capital out of motorsport, he decided not to take the “safe” option of learning within a company. He had formed his own rally team and Prodrive by 1984, developing motorsport parts and preparing to manage others’ motorsport projects.
“Most of us go into a business – I certainly did in the early days – with a very vague notion of what product offering we had or how we were going to deliver it. There was no business plan, no strategy as such. It was only after 10 years of wandering around, going from pillar to post – doing anything that came along – that we actually sat down and said: ‘let’s define a business strategy and let’s communicate it throughout our organisation’. That was actually a fundamental turning point for us.”
Another decisive moment came seven years ago, when Mr Richards sold 50 per cent of Prodrive to venture capitalists Apax. “It allowed us to plough more investment into the company – to do things in a more efficient way and let us be more adventurous. We were able to open in North America, Australia, the Far East and, more recently, China.”
Mr Richards says he can understand why many find starting a business daunting. “I’ve been very fortunate in that I just started off. I’d never had a permanent job as such, so I never knew anything different than working for myself, on occasions on a fair old shoe string wondering where the next meal ticket was coming from. But if you have worked in a structured environment – come out of university, or worked five years in a big commercial organisation – then that first step must be very forbidding.”
He is dismissive of business machismo, and quietly relishes a consensus in the tight-knit motorsport community that, occasional bursts of ego aside, “DR” is one of the sector’s rarer “good blokes” – earning his place through motivation, not diktat management.
But the competitive streak is fully evident. “Motor racing is no forgiver of mistakes. You are placed in direct comparison with competitors on a fortnightly basis in the full glare of the international media. A real competitive instinct counts for a lot. You can wander around the office at nine in the evening and find engineers working on projects. The competitive instinct runs through and through the company like a stick of rock.”
Mr Richards follows no role models. Nor does he go elsewhere for advice. “I don’t go looking for consultants or those with no active involvement in the business. I sit down with the people who are directly involved, discuss how we’re going to go about things and how we’re going to resolve things internally. That’s my starting point, always.”
He does not believe the UK business climate is hostile to start-ups. “People are more openly applauding of businesses that do challenge, do take risks and as a consequence are successful and employ more people,” he says. He believes the government should limit its role to generally creating “an infrastructure and environment in which new business can blossom, such as getting appropriate tax breaks to invest properly.”
Red tape, he acknowledges, can be an irritant in a business requiring working long hours “and sometimes working in environments which conventional health and safety would find quite unacceptable, such as at race circuits sometimes. But we don’t accept it as a barrier or excuse – just another hurdle to overcome.”
Mr Richards insists he is no miraculous time manager. “It’s about having the right people around you, spending your time in the place that’s most appropriate and giving your time as effectively as possible. I work quite long hours. I enjoy that. And I play equally as hard as well when I get any time off.”
As far as personal ambition goes, he says: “I suppose I’ve moved into the next phase now, to see that what we’ve established here is sustainable, that we’ve got proper management in place for the long term and that the thing will go forward without me.
“Because that must be the ultimate goal: to engineer yourself out of the job as you go forward.”
Time to plan for the future after a whirlwind nine months
David Richards says that if anyone had told him nine months ago that he would lead a consortium to buy Aston Martin, “I would have found that somewhat incredible . . . So these days I don’t regard anything as too far-fetched.”
“I won’t talk about anything specific,” he says, when asked if he would consider leading another buy-out in relation to Ford’s sale of Jaguar and Land Rover.
Associates suggest that the lack of an outright denial means he is at least mulling it over. Indeed, Mr Richards gives not the slightest hint that, in simultaneously taking over Aston Martin and launching into Formula One, he might be biting off more than he can chew.
Final completion of the Aston Martin sale took place at the start of June and he says there is already in place “a very sound medium-term strategy. We’ve got a product line going forwards for the next few years – the DBS model this year, the Rapide [four-seater] in 2009 and the enhancement of other products as we go along.”
The real challenge now, says Mr Richards, is to look to the future. “This business of building cars doesn’t work week-by-week or month-by-month. You need business plans going five, 10, 15 years into the future. That’s where we’ve got to focus now.”
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