Finding My Virginity: The New Autobiography

by Richard Branson

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  When people wonder whether we are stretching ourselves too thinly, across too many different sectors, they are forgetting one of the traits of the Virgin brand—its ability constantly to adapt. We have gone through countless inventions and reinventions, and will continue to do so. After fifty years, our brand has a freshness others don’t have. We are still more human, more adventurous and exciting and have added trustworthiness to that.

  It will be interesting to see what Virgin is like thirty years after I’ve gone. That’s going to be a really interesting challenge for the team and my children. I think it will be quite a different company—the danger is, will it be too professional without me? We need to keep our risk-taking attitude and stick our necks out when the time is right. I have seen so many companies come and go, largely because they didn’t reinvent themselves. They stayed in a sector that had died, whereas Virgin was always one step ahead of the game. I learned that from the great musicians as much as anyone else. David Bowie, Prince, Madonna—their careers are lessons in the power of transformation. Most people think: know your onions, then stick to them. My worry is that people will get bored of onions and move on to carrots instead, putting your onions out of business. So I enjoy trying to be the person selling carrots before anybody else does.

  I have always thought I should only go into businesses I have a genuine passion and interest in. It’s why I started with a magazine, then went into music as a young man. As I started traveling more, it made sense to branch out into airlines, holidays and hotels. As somebody constantly on the move, mobile phones and connectivity were a good fit next. When I got a little older, I became more health-conscious and our health and wellness businesses followed. Now, I find myself running banks and even, in South Africa—I recently learned—launching funeral insurance. Talk about a birth-to-death way-of-life brand! We have carried out research showing our brand is the favorite among three generations. If we hadn’t evolved and turned it into a way-of-life brand, that could never have happened.

  I’m not the same man I was in my twenties, and the brand isn’t the same either, but we have the same core values we always had. One of the keys to this is local knowledge, and altering our approach to suit the market. A great example of this is Virgin Active, a global brand that maintains a common purpose while containing unique characteristics in each country. In 2015, I was in Melbourne, hanging upside down from a piece of rubber in a class I am reliably informed is called Anti-Gravity Yoga—if you say so. The new clubs were very different from the ones I went on to visit in Singapore and Bangkok, and different again back in England, where we were expanding further. It would be impossible to spread to so many markets with so many different offerings if it wasn’t for the power of the Virgin brand. As Matthew Bucknall readily admits: “There’s a reason it says Virgin Active above the door, not Matt and Frank’s Fitness Factory!”

  When you go into new territories it is helpful if you already have brand recognition, but crucial to have local knowledge and adapt to the environment. In Singapore, I asked why we weren’t calling Virgin Active “health clubs” as we were everywhere else. The local manager explained to me that the phrase had a connection with brothels, which was certainly not the impression we wanted to make—especially with Virgin in our name! Similarly, in our clubs with a predominantly Chinese demographic we don’t use any black colors on our branding, as it has connotations of death—the very opposite of our full-of-life philosophy. If we had gone in with a cookie-cutter approach and replicated what worked elsewhere, we would have fallen flat on our face. It was a useful lesson in looking out for holes in the road before they materialize. If you stop mistakes before they happen, life gets a lot easier.

  Virgin Active is one company that closely mirrors my vision for the whole Virgin brand. It is all about improving people’s lives, has a spirit of fun and entrepreneurship at its heart, and is committed to giving staff and customers the best possible time. The way it has been run, from a bootstrap start-up into a global business, is the perfect example of delegation and trust. By letting them make their own mistakes and enjoy their own triumphs—chipping in whenever necessary, instead of being on the phone every day second-guessing their decisions—Matthew, Frank and the team have grown a worldwide brand people love.

  By 2015, Virgin Active had grown profits for eleven consecutive years and employed more than 20,000 staff. The question now was whether we should follow in the footsteps of Virgin Money and Virgin America, and think about a flotation. But after looking at an IPO with our partners CVC, we decided instead to sell 29 percent of our stake to Brait for £230 million, retaining 20 percent of the business and the branding rights. The deal valued Virgin Active at £1.3 billion—not bad for a company that started with one gym in Preston burned to the ground.

  It was a fitting figure, too, as we now had 1.3 million members across our 267 clubs in nine countries and four continents. The deal was a perfect example of our investment strategy for the new business landscape: building companies to scale, then accessing external capital to build them further through sales of stakes to partners or through the public markets. I called Matthew and reminded him of the promise he and Frank had made at our first meeting sixteen years earlier.

  “You said we would build a billion-dollar company,” I recalled. “Well, today you’ve done it. Well done!”

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  The danger with going public, of course, is that the company you’ve developed is open to the possibility of a takeover. In 2016, just eighteen months after we’d made it public, that was the threat that faced Virgin America.

  Throughout the previous months, rumors had been growing that bigger airlines were queuing up to buy Virgin America. The rumors were true: while we continued to expand our routes and services—adding Hawaii, improving our touch-screen entertainment—behind the scenes a bidding war was raging. I had no desire to sell: indeed, my instinct was to defend the business we had grown from nothing to become the most-loved airline in the US. Sadly, there was nothing I could do to stop it. Because I’m not American, the US Department of Transportation required that I hold a large part of my interest in Virgin America through non-voting shares, which severely limited my influence over any takeover.

  Although a few Asian airlines had expressed an interest, the battle for control was shaping up between JetBlue Airways and Alaska Air. I decided to meet separately with JetBlue CEO Robin Hayes and Alaska CEO Brad Tilden. They were eager to get my support and hear more about Virgin America and the history of the brand. I came away with the instinct that Alaska seemed to understand our purpose and spirit more intuitively. Having said that, we had history with Alaska: along with most other US airlines, they had been among the companies trying to block us getting off the ground. I still remember standing at an airport gate in 2009 after we’d finally got permission to fly and cheekily mooning the Alaska team on the next gate!

  I had started Virgin America out of frustration at poor service and a belief we could do it better—the same reasons we had launched Virgin Atlantic and Virgin Australia. One of the best explanations for these poor standards was consolidation, and, as time has passed, American aviation has only got more consolidated. By 2016 the four biggest airlines in the US—American, United, Southwest and Virgin Atlantic’s partner Delta—controlled around 80 percent of the market. Ten years earlier, by contrast, there had been nine major airlines in the States. Into this shrinking market, Virgin America had won people’s hearts and fierce loyalty. I wanted to make sure that whoever won the race to buy us didn’t throw all that we’d worked for away. As the bidding continued, Alaska came out with a spectacular offer and JetBlue decided they couldn’t go any further.

  On 4 April 2016, Virgin America’s board of directors unanimously approved a merger agreement for Alaska Air to acquire Virgin America for $57 per share—approximately $2.6 billion. This was an enormous return, especially considering the hundreds of millions we had
lost in the early days of the airline. But I was heartbroken and spoke out about how sad the deal made me feel. People loved this airline. I believed we had so much more to do, more places to go and more friends to make along the way. I would love to have seen the directors be braver and grow it into the fifth major airline in the US.

  I wasn’t the only one to feel disappointed. Virgin America’s loyal customers were absolutely furious, and I could understand why. One Elevate Club member wrote an expletive-filled rant that illustrated the strength of feeling about the deal. “Go to Hell . . . I loved Virgin America. Now, this merger means that you’ll just be another bullshit airline. Can’t wait to see how the customers get fucked over. Go ahead and blow some more sunshine up my ass. I read all of the crap listed about the merger. Smells like bullshit to me. Thanks, but fuck you.” Mike Brophy tweeted me: “@VirginAmerica being acquired by @AlaskaAir is like Apple being acquired by Microsoft. There went the last great airline.”

  It was the feedback of our staff that hurt the most. I spoke to several of the team I have got to know well, and they were all gutted. It felt like the shareholders had sold out our people—brilliant, passionate, unique people. When I asked a few of the team, “Hypothetically, if we were to start another airline, would you join us?” the answer was a unanimous “Yes.”

  I build companies because I love creating things that make a difference—Virgin America is a perfect example. I’m not motivated by more money in my bank account, other than to use it to create more things I’m proud of. I went to San Francisco and spoke to more of the team. “A check in the bank is honestly not that exciting a thing,” I told them. “A living, breathing, heart of an airline with all its people, all that it is achieving and the difference it is making to lives is an enormously satisfying thing. You should always be very proud of that.”

  We had to move on fast, and concentrate on the battle to keep the Virgin America brand and team flying. I emailed back and forth with Brad, urging him to explore the possibility of Alaska using the Virgin name, or at least a two-branded option and keeping our wonderful team together. It would be madness for Alaska to buy Virgin America, then simply strip it of everything that had made it great in the first place.

  Brad invited me up to Seattle to meet their team and get to know their people. After we completed a lively Q&A with the staff, I got the feeling that they were as eager as we were to find a productive way forward. Brad told me if he dropped the Alaska brand and just used Virgin America he would lose his job. I understood; Alaska held a lot of emotional weight in Seattle. Our teams put our heads together: Evan, Christine and Nick from Virgin Group, along with David Cush, Luanne Calvert, Abby Lunardini and the Virgin America team, did sterling work making the case for our fantastic team and brand. We pointed to the example of Virgin Atlantic and Delta, two airlines working seamlessly together while growing both brands strongly.

  “We’re going to take some time over the next several months to learn more about their brand,” said Alaska’s spokesperson Joe Sprague. “The Virgin brand is popular globally. We want to respect that.” That turned out not to be true. In mid-March 2017, Alaska informed us that they would retire the Virgin brand in 2019 and lay off a lot of people. I was angry, but helpless to stop the decision. I penned a heartfelt letter to Virgin America, our people and our customers.

  Dear Virgin America,

  With a lot of things in life, there is a point where we have to let go and appreciate the fact that we had this ride at all . . .

  We went through a lot together. And you were worth every minute, every penny, every battle. We earned every loyal guest and fan. Every market was hard-won. It was a long and hard journey but in the end you are the best consumer airline in America.

  To each of your brilliant Teammates, I know that you will continue to do great things, whether you stay on with Alaska or pursue a different path . . . To our wonderful guests, I speak for everyone at Virgin America when I say we are eternally thankful. For believing in the little airline that could . . .

  Businesses come and go but beloved brands make lasting impressions and remain in your heart. As an entrepreneur’s brand, Virgin is always starting new businesses. And we will not stop . . .

  George Harrison once said “All Things Must Pass.” This was the ride and love of a lifetime. I feel very lucky to have been on it with all of you. I’m told some people at Virgin America are calling today “the day the music died.” It is a sad (and some would say baffling) day. But I’d like to assure them that the music never dies.

  As fate would have it, I found myself in Seattle, Alaska Airlines’ hometown, soon after. Virgin Atlantic was starting a new route to the city, but reporters wanted to know about Virgin America. I leaned back in my chair, paused, then let rip. “I thought I’d be polite, but I’ve decided not to be,” I said. “They spent $2.6 billion buying it. Sadly, it seems, they have decided to rip the heart out of the airline. It just seems such a waste. I wonder what it was that Alaska bought, and why did they bother?”

  We have the option of starting a new airline in America. The rules still make it tough for me to own much of a US airline. But we could always work with an existing US airline to create something magical again—now that would be an exciting challenge.

  CHAPTER 36

  Audacious Ideas

  On New Year’s Eve 2015, I was welcoming in the new year by dancing on the bar on Moskito Island with Larry and Lucy Page and Jeff Skoll, (a wonderfully generous individual) who helped start eBay. As the party began to wind down, we clambered down onto our seats and began pondering one last drink. After I had rustled up some ill-advised cocktails, we decided we should see in the new year by doing something together that year that would really make a positive difference. By the time we had recovered the following day, I suspect the three of us had forgotten the conversation. But I always have my trusty notebook—even on New Year’s Eve—and there were some very scrappy notes in there, one of which was just two words long: Audacious Ideas.

  A couple of months later I was in a Hobie Cat sailing from Necker to Moskito with Jean Oelwang, Holly, Sam and Chris Anderson, the founder of the brilliant TED Talks, when I suddenly remembered our New Year’s Eve pledge.

  “I know what Audacious Ideas is,” I realized. “Well, kind of . . .”

  As I filled them in, Chris said Jeff had had a similar conversation with him and we should do this together.

  We slowed up the boat, circled Necker and spent the trip thinking up the most audacious ideas we could come up with. By the time we pulled ashore we had agreed to hold an “Audacious Ideas” gathering for people with financial firepower who want to make a real difference in the world. Chris volunteered his wonderful TED team to lead the project, which we all agreed to, with Virgin Unite in full support.

  “Where will we hold it?” asked Holly.

  “Here, of course,” I waved toward Moskito.

  In May 2015, I was back on Moskito with a group of wealthy philanthropists (who have asked to remain anonymous). We decided in advance upon a shortlist of organizations to potentially support, who would pitch their ideas via video and live link. Successful pitches included: RMI, focused on integrate energy planning in Africa; Kawisafi, a group focused on bringing solar power to people living in poverty in Africa; and The War on Methane, an ambitious Environmental Defense Fund (EDF) project working with the oil and gas industry to stop methane leakage. We had lots of questions, and debated each pitch long and hard. People generally do their own thing in philanthropy—but over those few days I think people learned what fun it can be to work with others.

  The pitch that stood out for me was from Andrew Youn. Andrew runs One Acre, a remarkable nonprofit organization that supplies hundreds of thousands of smallholder farmers in East Africa with financing and training to reduce hunger and poverty by dramatically improving the productivity of their small pieces of land. It was clear immediately there was a lot
of interest in supporting this idea. We all huddled together in the living room on Moskito as Andrew gave his pitch on the screen, ending by asking for $100 million in funding. We walked out into the corridor, had a chat, agreeing what we could each put into the pot. Then I came back in alone to see a very nervous-looking Andrew staring back at me on the TV.

  “First of all, Andrew, we all love your idea. But I’m sorry; we can’t get you all the money you need. But we can get you $1 million.”

  He said how very grateful he was, but I could tell he was a little disappointed.

  “Only joking!” As everyone came rushing back into the room, I told him he had his $100 million. “Now get out there and transform many, many, many more lives in many, many more countries.” There was much laughter and even tears among those who’d gathered and been so incredibly generous.

  In two days, over $150 million was committed to some great projects and many new partnership ideas were formed. One project that could have the most lasting effect on our globe started with a conversation about the need to get the pension industry to switch their trillions of investments to tackle the Global Goals—a series of ambitious targets to end extreme poverty and tackle climate change. If $2 trillion could be invested (for profit), most of the Goals could be reached. TPG founder Bill McGlashan, Bono, Jeff Skoll, myself and others agreed to show the pension industry how it could be done. We agreed to set up Rise, a social impact fund to invest in companies that purposefully would make a real difference in the world. Within months Bill and team had raised $2 billion to kick it off. It had indeed been an incredible few days! We all agreed that Audacious Ideas would become an ongoing event.