Richard Branson: the goateed mascot of British capitalism

Sir Richard Branson’s Virgin empire is in trouble due to coronavirus. Can it be saved?

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Over the years, critics have increasingly tired of Sir Richard Branson, “the goateed and grinning mascot of British capitalism”, says The Economist. They grouse about the Virgin founder’s peculiar knack of creaming off cash from his ventures at the ultimate expense of the taxpayer. Now the billionaire is back with his begging bowl, says Spiked, gunning for a £500m state bailout of his airline, Virgin Atlantic, which is in danger of collapse. Down under, Virgin Australia (the country’s second largest carrier) has requested an A$1.4bn emergency loan.

Branson (currently personally worth around $3.9bn, according to Forbes) has offered to sweeten the bailout pill by putting $250m of his own cash into the Virgin group, says The Times. But it’s “unclear how much of that is earmarked for the airline” given competing demands from other troubled Virgin businesses, including its hotels and health clubs. “This is no time for Branson’s usual smoke and mirrors.” The public is in no mood to stump up for a billionaire based in an offshore tax haven – Branson needs to flash some more cash of his own if he wants to save his empire.

A hippy acquires business smarts

The son of a barrister and a flight attendant, Branson began his entrepreneurial career as a teenager – after quitting Stowe School at 16 to start a magazine called “Student”, says Entrepreneur. His former headmaster marked the launch with a prophetic note: “Congratulations, Branson. I predict you will either go to prison or become a millionaire”. Branson hit upon the idea of using the magazine to advertise mail-order records and “the business soon became more lucrative than the magazine”.

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Branson clearly had business “smarts”. In 1971, he partially fulfilled his headmaster’s prediction when he was briefly “hauled into jail” following a scam to defraud Customs & Excise (he was saved when his mother showed up and posted the family home as bail). Virgin Records’ big break was backing Mike Oldfield’s 1973 hit Tubular Bells. Three years later, he signed The Sex Pistols. The band and their “shrewd manager”, Malcolm McLaren, initially took Branson for a “naïve hippy”, notes Spiked. But they were “soon taken aback at how ruthless and canny he was”.

Over the ensuing decades Branson launched a bewildering array of high-profile businesses – from Virgin Atlantic (1984) and his space-tourism venture, Virgin Galactic (2004), by way of Virgin Money, Virgin Radio, Virgin Trains, Virgin Cola, Virgin Cosmetics… By 2014, the group had interests in 200 companies across 30 countries. The secret to his later expansion, says Entrepreneur, lay in “licensing the highly regarded Virgin name” – enabling him “to launch a patchwork of businesses with minimal investment”: a strategy he dubs “branded venture capital”.

Rebranding the latest trends

Branson has continued “his shtick of attaching the Virgin brand to the latest trends”, says The Sunday Times. Thanks to tips gleaned from his new mates in the British Virgin Islands (Google founder Larry Page owns the island next door to Necker, where Branson is based), he has also built a “sprawling portfolio of tech investments”. Necker was devastated by a hurricane in 2018. “The island is mending. We’ll get it back and beautiful again,” he said last year. Doubtless he’ll be hoping much the same of his Virgin empire.

Jane writes profiles for MoneyWeek and is city editor of The Week. A former British Society of Magazine Editors editor of the year, she cut her teeth in journalism editing The Daily Telegraph’s Letters page and writing gossip for the London Evening Standard – while contributing to a kaleidoscopic range of business magazines including Personnel Today, Edge, Microscope, Computing, PC Business World, and Business & Finance.

She has edited corporate publications for accountants BDO, business psychologists YSC Consulting, and the law firm Stephenson Harwood – also enjoying a stint as a researcher for the due diligence department of a global risk advisory firm.

Her sole book to date, Stay or Go? (2016), rehearsed the arguments on both sides of the EU referendum.

She lives in north London, has a degree in modern history from Trinity College, Oxford, and is currently learning to play the drums.