Peter Hargreaves, 63, co-founded investment brokers Hargreaves Lansdown with Stephen Lansdown in 1981, starting from his spare bedroom with a single phone. In 2007, the Bristol-based company was floated on the London stock market, valued at £800m.
Born in Lancashire, Hargreaves attended Clitheroe Royal Grammar School and became a chartered accountant in 1970. He went on to work for KPMG, Unisys and Whitbread before launching his own business.
Hargreaves is married to Rose, with two children, and lives near Bristol.
Did you think you would get to where you are?
Yes, we were sure of our abilities. My partner’s wife was seven months pregnant when we started the business. That was confidence. Whenever I felt depressed, I used to look at somebody else’s business, and I realised that we were better than almost any other in the UK. I just saw complete amateurism throughout much of British industry.
When you realised that
you had made your first million, were you tempted to slow down?
My uncle, who made his fortune from dog biscuits and was a millionaire, used to say the first million is the hardest. I never believed him. But he was absolutely right. In 1987, we were heading towards our first million pounds profit, but then the stock market crashed and we had to struggle for several years.
I was probably worth £1m before the end of the 80s. I did not want to slow down because I loved the business. Today, if there is a penny movement in the Hargreaves Lansdown share price, my wealth goes up or down by £1.5m.
What is the secret
of your success?
You need to establish what your customers want but only provide them with what will also be good for them. Many people who go into business can sell. What they don’t do is to watch the cash and keep costs down. It is absolutely vital. Stephen Lansdown and I look at every single purchase invoice every month. Just the fact that people know we do this is important.
What is your basic
When we started, I wanted to be the biggest in our field. Stephen wanted to be the best. The only way to become the biggest is to be the best.
You have to give your clients what they want: the best service, the best information and the best prices. While sales commission drives the other businesses in our spectrum, we make nothing when we provide an investment.
Do you want to
carry on till you drop?
I will need to have some business involvement, perhaps something here in the office but reduced hours. I want to let the young and energetic people take the business forward at some stage.
Have you had time for
personal financial planning?
I don’t need it. It is natural to me, automatic. I unconsciously evaluate my own finances. The only thing I’m lousy at is the paperwork surrounding it all, so I use a lawyer and tax specialist.
What was your most
Starting up Hargreaves Lansdown. We both put our cars in as company assets and we worked three months for nothing, living on our savings.
Over the last ten years, I’ve invested £1m in ITM Power, which provides technology for the hydrogen economy. My capital is worth more than what I put in, but I am hoping it will be worth substantially more. It is something for the future of mankind.
Have you taken steps
to pass on your wealth?
I cannot think of any more deserving cause than my own family. I would like my wealth to remain in my family forever and be the birthright of future generations.
Have you made any
I don’t really need one, but I have funded a pension to the maximum allowed, about £1.75m. After that, if you pay in more you don’t get tax relief. There is no better way of saving than a pension.
Property is not such a good investment. Think about the extra costs: stamp duty, roof repairs, and insurance. But you should buy the house you live in because it is pride of ownership. I only own one home.
Do you allow yourself
the odd indulgence?
I drink quite expensive wine. I go out to expensive restaurants and I will buy quite extravagant clothes, like Berluti shoes. I like staying in the best hotels on holiday, the Madinat Jumeirah in Dubai and the St Regis Mardavall near Portals Nous, Majorca.
Picasso or Art Deco
as an investment?
I have a small art collection. I bought some very early Kurt Jackson watercolours, for which I paid less than £100. They sell for far more now. The rest are mainly 19th-century oils.
What is the most you have ever paid for a bottle of fine wine or champagne?
I like The Priory restaurant in Bath, where I have been known to spend a couple of hundred pounds on a bottle of wine.
What is your money-saving tip in the recession?
I have always been frugal and we have got rid of our two silly cars. My wife had an Aston Martin and I have just sold my Audi R8.
The first thing everyone should do, in good times or bad, is to pay off their mortgage – regardless of what the interest rates are.
We throw away almost no food and are nearly self-sufficient in vegetables and fruit – apples, pears and strawberries. We are even eating a trout I caught yesterday!