tv The David Rubenstein Show Peer to Peer Conversations Bloomberg August 4, 2018 9:00am-9:31am EDT
david: where did the name virgin come from? richard: one of the girls laughed and said, are you a virgin at business? david: did she get a finder's fee for that idea or not? you begin building other companies. richard: the only reason we would go into a new sector is if we felt it was being badly run. david: is there something in your life you have not achieved? richard: we are finally on the verge of fulfilling that dream, the virgin galactic spaceship and going to space. david: now you are a sir, you were knighted. richard: i was slightly nervous.
they would have been a slice at the head rather than a tap on the shoulder. >> would you fix your tie, please? david: well, people wouldn't recognize me if my tie was fixed, but ok. just leave it this way. alright. ♪ i don't consider myself a journalist. and nobody else would consider myself a journalist. i began to take on the life of being an interviewer even though i have a day job of running a private equity firm. how do you define leadership? what is it that makes somebody tick? you have written two books. one is "losing your virginity," and the other is "finding your virginity." in those books, you describe this path from where you have gone from very modest meanings to this great wealth. when you started life, you were not a great scholar as a young boy because you had dyslexia.
when did you realize you had dyslexia, and was that a problem for you that early on? richard: in conventional schooling terms, it was a big problem. i would sit at the back of the class, look at the blackboard and it was just a jumble. and, you know, i was thought of as a bit lazy, a bit thick, or a mixture of the two. if i was interested in something, i generally excelled. and what i was interested in was what was going on in the world. so the vietnamese war was going on, there was a general sort of uprising of students taking place. so i decided to start a magazine to campaign against the things i thought were wrong in the world,
and particularly the vietnamese war. david: this was 15 years old? you drop out of school at 15 start the magazine. ,as part of the magazine, you get prominent interviews, like some from mick jagger. was it hard to get an interview with mick jagger when you are 15 years old? richard: you know, in some ways, i think if you are 15, you have a better chance of getting interviews with people than if you are 30 or 40 or 50. i would just turn up at people's houses. and because i was young and enthusiastic, they generally took pity on me. david: ultimately, you decided to start a record company. where did you get that idea from, and where does the name virgin come from? why not branson? richard: i was 15 years old, 16 years old, we were sitting in the basement with a bunch of girls. we were throwing out ideas.
we got down to either slipped disc records, because of the black records, vinyls, that had the scratches, or virgin. one of the girls laughed and said, we are all virgins, you are a virgin at business, why don't you call it virgin? david: did she get a finder's fee or not? richard: i don't know. if she is out there, i would be delighted to give her one. but it is very fortunate because we have gone into so many different sectors and businesses. we have been virgin in all of these different sectors. slipped disc airlines would not have been good. david: you started a record company, and initially it is a record retailer, right? richard: initially it was a mail order, selling records much cheaper than anyone else had done. we were the first people to sell records at a discount. so there was a mail order strike for six weeks, so we went looking for a very cheap music
store on oxford street. david: then you started filling virgin megastores. you have a lot of stores in the u.k. and other places. how many did you have at one point? richard: we had about 300 megastores around the world in all the main places, like in times square, oxford street, in the heyday when music was all that young people did, before games, mobile phones, and the other things young people do. was thehe success virgin name, your self-promotion of it, or were you selling things cheaper than other people? richard: virgin was synonymous with music credibility, so frank zappa, the rolling stones, so we had a very credible brand. one day, there was a young artist that came to me with this fantastic tape. i took it to a number of record
companies, and none of them would put it out. i thought, screw that, we will start our own record company, and we put it out on our own record company. and it became a great success. david: so you have a record retailing company and a record production company, both called virgin. someone drew a v for you to be your logo? richard: we decided we needed a hipper looking label, and someone came up with this signature. david: you decided you needed to start an airline. where did that idea come from? richard: it came from -- i was trying to get from puerto rico to the virgin islands. i was 28 years old and i had a lovely lady waiting for me. david: and you went to the virgin islands you like name virgin, i assume. richard: that is true. anyway, american airlines bumped us.
i have been away from this lady for three weeks, so i went to the back of the airport, hired a plane, hoped my credit card would not bounce. i wrote virgin airlines on a blackboard, and i wrote $39 one-way and i went to all the other people who were bumped, and i filled up up my first plane. when we landed, a passenger next to me said you ought to sharpen up your service a bit and you can be in the airline business. i thought, okay, so i rang up i asked if they had any secondhand 747s for sale. we started with one secondhand 747. but we were against british airways, with 300 plus planes. british airways launched a dirty tricks campaign against us. they did everything they could to drive us out of business. we took them to court. we won the biggest damages in british history. we redistributed it to all of our staff equally.
and so every year we hope british airways will launch a dirty tricks campaign against us. david: people like the fact that you are the against the establishment airline. one time i read that what is now called the eye, the big ferris wheel in london, british airways was supporting it and they could not get it assembled and the cannot get it to work. and you rented a -- was it a blimp? richard: we actually had a small blimp company, and we scrambled the blimp and we flew over the eye as it was still on the ground and all the world's press were there to watch this be erected. and they cannot get it -- and we british airlines cannot get it up. we got the headlines, they didn't.
the only reason we would go into a new sector is if we felt it was being badly run by the people. the recent we went into trains was the government were running trains, british rail was dilapidated trains, a miserable service. getust felt to bitcoin, fantastic new -- we felt we newd go in, get a fantastic real start and we could make a big difference, so we took the busiest mainline on the west coast and we have gone from 8 million passengers to nearly 40 million passengers. i think we have transformed the experience for people. and every new sector that we we have seen a gap in the market, where the big guys have not been doing it very well, where we can come in and shake up an industry.
david: how many companies have you started with the name virgin? is it a few hundred by now? richard: it is in excess of 300, yeah. david: a couple could not have worked, so when you start them and they don't work, you end them after a year or so? richard: yeah. david: but none of them have filed for bankruptcy. richard: we are fortunate to never have had a bankrupt company. if something doesn't work out, we will settle the debts and go to the next company. daivd: now you are a sir, you were knighted. did you ever expect to be a member of royalty in effect, or knighted? richard: we once put out a record called "god save the queen" by the sex pistols. i was slightly nervous if she would remember the words on the record, if it would have been a slice at the head rather than a tap on the shoulder. ♪
your life you haven't achieved that you would like to achieve? richard: we have spent 14 years working on a space program. it has been tough. it has been tough. space is tough. it is rocket science. and you know, i think we are on the verge of finally fulfilling that dream. and before the end of the year, i hope to be sitting in a virgin spaceship going to space. david: you have about 2000 people or more that have signed up. are they still ready to go? richard: well, actually signed up and paid up, it is about 800. david: what does it cost to pay up? richard: it is $250,000. about 50% of the people watching this program would love to go to space. there are about 50% who think these people are mad, what on earth do they want to go to space for?
but the market of people who want to go to space is gigantic, and we hope to be able to satisfy quite a few of those people. david: do you think you can make a profit on this in the end, or is it a love of doing this? richard: i never go into a venture with the idea of making a profit. you know, if you can create the best in its field, generally you will find you pay the bills and make a profit. david: the way i understand it works, it is not like a rocket goes off. you have an airplane, attached to it is another airplane, and a one that separates goes into outer space. richard: the one that drops fires its rocket. and you will go about north and in 10 seconds, you will be traveling at 3000 miles per hour into space. david: how long would you be in space on the ride you are talking about? richard: so the whole experience would be something like like three hours. david: would you be on the first
flight? richard: i will be on the first official flight. we've got very brave astronauts, effectively test pilots, who are testing the craft time and time again and ironing out out anything that can go wrong before myself and members of the public go up. david: so i am sure it will be safe, but one time when you did hot air ballooning, you are not -- you were not sure whether you would survive. richard: with the ballooning adventures, i was doing something nobody had done before. i was trying to fly across the atlantic or the pacific or go around the world in a balloon. i was flying at 40,000 feet in the jet stream with one other person. and you know, the technology was completely unproven. we were the test pilots. david: that was quite dangerous. richard: things could go wrong, and they did go wrong. david: but you set a number of
guinness world records. in hindsight, do you have any regrets about taking those risks on the hot air balloon? richard: it's interesting. my son and daughter now are setting themselves big adventures every year, dragging their dad along with them. and a think as a family, we feel like, live life to its full. you can die in a road accident, you can die in a normal bike ride. and quite often, when you are actually completely focused on an adventure, it is less likely in some way you are going to die, because you are ready and sharp and know how to deal with it. david: so you are very well recognized for all of the things you have done around the world, but your hair and your goatee are fairly well recognized. so did this always -- have you had a goatee most of your adult life, and has your hair always
been this length? richard: i have always been a hippie since i was 15 years old. and i have had a beard ever since i was 15, 16 years old. so i shaved it off once when we launched the company called virgin brides. i put my bridal dress on, gave gay people a good laugh. and we found out there weren't any virgin brides, so that business did not succeed very long. or maybe it was the fact that i was not the most fetching bride. david: so now you are a sir, you were knighted. did you ever expect to be a member of royalty in effect, or knighted? richard: we once put out a record called "god save the queen" by the sex pistols, and i
find myself 25 years later being knighted. and i was slightly nervous she would remember the words on the record, and it would be more of a slice of the head rather than a tap on the shoulder. but she forgave us. david: this was not done in the tower of london, i guess. richard: fortunately, it was not done in the tower of london. david: for those that may not know about it, as i understand, in the late 1970's, there was an opportunity to buy an island, the british virgin islands. richard: they wanted $5 billion for this beautiful island. i thought i could scrape together about $100,000. i offered about $100,000. nobody else fortunately came to see the island. they said if i made it $120,000, they would make it an island. i went everywhere to borrow and beg to get that $120,000, and we ended up with the most beautiful island in the world.
david: you built a house there, and there is also a resort. richard: it is our home, it is a magical place. and you know, we have fantastic get-togethers of people, sometimes conferences there, where we try to sort out the problems of the world. people just come on holiday and book the island. david: barack obama and michelle obama managed to go there. richard: he was good enough to invite me to the oval office three months before he stepped down. we had a lovely lunch and we agreed with each other on most aspects of life. david: so i guess he was a nice houseguest? richard: both of them are absolutely delightful. and i think -- you know, we had a fun competition. anyway, he beat me. he learned to kite before i
could foil board, and yeah. it was a great privilege to spend time with them. david: many times people who become financially successful and otherwise well-known, they seem to be unhappy for some reason. richard: i would be a very sad person if i wasn't a happy person. i have been blessed. every day i am learning. i see life is the one long university education i never had. i feel i am a perpetual student. ♪
for 10 years we knew each other very well. we set up the elders, 12 incredible men and women who would go into conflicts and try to resolve conflicts. conflicts, i think, is the most important thing. because if you have a conflict, everything else breaks down. david: what makes great leadership in your view? richard: i think being a really good listener is one of the key things. when i sit around and listen to the elders talk and elders' meetings, you realize why they have become elders is because they have spent their life absorbing and only speaking, choosing their words carefully. i think loving people -- a genuine love of everybody. and looking for the best in
people, even if they are being a pain, you can normally find the best in pretty well anybody. david: so when you are a business leader, if you are a business leader -- if someone is watching this and wants to be richard branson, sir richard branson, what is the key? richard: surrounding yourself with great people. learning to delegate early on, not trying to do everything yourself. you know, making sure you've got the kind of people that are praising the team around them and not criticizing the people. and, you know, having people who are willing to really innovate, be bold, and create something that everyone that works for the company can be proud of. david: one of the great things about your life is you have a terrific family life. you have been married more than 40 years. where did you meet your wife? richard: i met her in a
recording studio called the manner, a studio we had in the u.k. david: was it love at first sight? richard: it was from my point of view. she was making a cup of tea across the room, and i was absolutely smitten. she was with somebody else. i am afraid i had to chase her. my nickname became tagalong, because a friend who worked at virgin knew her and i would ask her if i could tag along when she was going out to dinner. david: it worked out and now you have two children you are very close to. i always think it is important if someone successful can do this when their parents are alive -- your father died. richard: he lived close to david: your mother is still 93. alive. what was it like having your parents see your success? richard: it was wonderful to be able to share it with them.
my mom -- my first $200 i got to start my business, my mom found a necklace, and took it to the police station and nobody claimed it, so she managed to sell it for $200. that was the critical money that helped me start. we managed to share this inderful life that i have looking at to lead with them. with my mother, we still do. david: in the philanthropic world, what would you say is the thing you are most focused on in the philanthropic, humanitarian area? richard: we are sort of serial philanthropists in the same way we are serial entrepreneurs, in that i find it difficult saying no to projects i feel are important. david: did you feel that when you grew up you would be wealthy enough to get away staggering amounts of money? richard: i certainly never dreamed that the incredible dream of my life would have actually happened, and that i would one day be in a position
to hopefully make a difference. david: well, many times people who become financially successful and are otherwise well-known seem to be unhappy for some reason. you seem to be a very happy person, very content. is that a fair assessment? richard: i think i would be a very sad person if i was not a very happy person. i have been blessed to have an absolutely lovely lady. we are complete opposites, but we get along great. blessed to be together most of our lives, blessed to have wonderful children, wonderful grandchildren, and every day i am learning. i see life as the one long university education i never had. i am learning something new from getting out there, listening to people. and, you know, i scribble everything down. i feel like i am a perpetual
student. david: let me ask you a question i have asked bill gates. do you think you could be more successful in life if you had a university degree? richard: no. obviously, you could be more successful. richard: no. at age 40, i turned to my wife and said, i think i will give everything up and go to university. she turned to me and said, you just want to chat up the young ladies at the university, you go straight back to work. [laughter] it was good advice. ♪ . . this isn't just any moving day.
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♪ jonathan: from new york city, i am jonathan ferro with 30 minutes dedicated to fixed income. this is "bloomberg real yield." ♪ jonathan: another solid jobs report in line with the federal reserve's outlook for gradual hikes. it is building. larry kudlow says the president will not back off china. china stepping in, closing in on a record weekly losing streak. we begin with the big issue, another solid jobs report. >> this truly is solid as a rock. >> a good jobs report today. >> the big surprise this year