Business nous and altruism have not always naturally gone hand in hand. Similarly, the TV show Dragons’ Den does not conjure images of benevolent giving or charity. However, if the den’s latest recruit James Caan has anything to do with it, this may be about to change. For when Caan’s not poring over the menu at one of his favourite restaurants in Monte Carlo or supping champagne aboard his yacht, he often spares a thought for those less fortunate.
Since selling his recruitment empire, Alexander Mann, Caan has ploughed hundreds of thousands of pounds into helping educate children in Pakistan. He named the school, which currently educates 428 children, after his father. “What better gift to give someone who didn’t have an education than to name a school after him?” muses Caan.
Charitable projects aside, Caan rubbishes the notion that business cannot be ethical. “I think if you can find investments which not only make you a profit, but which are also good for society, it must be a good thing,” he explains. “And because I am quite a spiritual person, I am conscious of the fact it’s not just all about money. I suppose I am a little more conscious of the balance than the next person, maybe.”
Despite amassing great wealth himself over the course of his career, Caan is scathing of those involved in the crisis currently gripping London’s financial district. “I think the current credit crisis illustrates my point that sometimes you can see excessive greed becomes quite dangerous.”
On the subject of greed, I find myself putting a question to Caan inspired by an interesting guest blog posted on the Growing Business website a few months ago. Suddenly the intensity of Caan’s stare is hiked up a few notches and the modestly sized meeting room becomes a little claustrophobic. In his blog, Michael Weaver, chief executive of VC and angel investment firm Beer & Partners, suggested the Dragons were becoming a little greedy in their requests for 50% and above equity stakes in exchange for fairly paltry investments.
Caan is incensed by the suggestion. “If I said to you: ‘I am going to introduce you to someone you’ve never met before and never heard of before and he’s going to tell you about an idea you’ve never had and know nothing about, and in 20 minutes, I wanted you to write me out a cheque for £100,000, you wouldn’t.”
“The only thing that compensates risk is return,” continues a clearly riled Caan. “So for all that risk you want to make a decent return to make that risk worthwhile. Frankly, you want at least 50% because the chances are you’re going to lose your money.”
The Den’s more affable Dragon has clearly now got found his stride, and I’m beginning to feel like a naughty schoolchild scolded for questioning the teacher’s authority. “Secondly, what value do you think a Dragon brings to an investment?” Caan’s eyes bore into me. “You get his mentorship, his involvement, his brand, his name.”
There is no denying Caan is good at what he does. After leaving school with little or no qualifications, he declined his father’s offer to work in the family business and set about making his own way in the world. Having turned down the plush office, company car and title that would have accompanied the job at his father’s textiles company, Caan was determined to carve out a successful career of his own.
“I suppose at the back of my mind I always had it hanging over my head that I gave up quite a secure opportunity to be thrown into the deep end and I had to make it; I had to find a way of making this work.”
And work it did. Caan set up his massively successful first business, Alexander Mann, after working in the recruitment industry for a couple of years and realising that the real money was to be made in headhunting for managerial roles. Not taken seriously by headhunting agencies because of his age, Caan decided to set up on his own and sold it 17 years later with a turnover of £300m and operations in 50 countries.
Since then, Caan has gone on to set up private equity firm Hamilton Bradshaw and more recently co-founded Insynergy Investment Management with business partner Spike Hughes. However, he refutes the commonly-held assumption that he is invincible when it comes to business. “I certainly wouldn’t say that everything I touch turns to gold; that’s clearly not true, I’ve had as many disasters as anyone else.”
But for Caan, those ‘disasters’, where he has lost ‘millions’ from bad investments, have a different kind of value. “I learn more when they go wrong than when they go right,” he asserts. “The balance of success and failure is a good thing. In business, I don’t think every month is a blockbuster month; you need the peaks and the troughs to keep you alive.”
There is no denying that Caan has probably experienced more business successes than failures; his bank balance will reflect this. But for this formidable businessman, it’s essential that he’s not the only one to enjoy the fruits of his labour. “It’s important for the people around me to have also prospered from the journey,” he reflects. “Business isn’t just about you, it’s about a team – very rarely do I meet people in business where their company has prospered just because of them.”