What was Touker Suleyman's biggest business failure and what did he learn?

Touker Suleyman lost everything after investing in a public retail company that was overvalued and fraudulent, leading to a negative net asset value. His key lesson was the critical importance of conducting thorough due diligence before any acquisition.

How did Touker Suleyman turn around the Horse and Curtis brand?

He bought the struggling fashion brand, Horse and Curtis, for one pound and took over its debt. By negotiating with creditors and strategically growing the store base to 40 locations, he successfully revived the brand.

What are the biggest challenges facing the fashion industry today?

The primary challenge is inflation, leading to a 'perfect storm' of increased transport, raw material, energy, and labor costs. This is shifting the industry from deflation to significant inflation, expected to rise above 10% in fashion.

Why did Touker Suleyman join Dragon's Den?

He initially didn't think he would be a Dragon but accepted the role. It broadened his horizons to different businesses, provided access to a valuable network ('black book'), and offered a platform to give back to young entrepreneurs.

What makes a pitch stand out on Dragon's Den?

A standout pitch, like Generate's, is characterized by accuracy, clear numbers, a well-defined market, and easy-to-understand business proposition. Pitching at a low valuation to attract investors, rather than focusing solely on high valuation, is also key.

What is the most important factor Touker Suleyman looks for in an entrepreneur?

The most crucial factor is the entrepreneur themselves. Touker evaluates their character, professionalism, and ability to run their own business, often relying on gut feeling developed over 48 years of experience. He believes entrepreneurs should ideally retain at least 50% equity.

What is Touker Suleyman's key advice for aspiring entrepreneurs?

He advises believing passionately in your idea, identifying market gaps, always having a plan, and understanding that cash flow is the lifeblood of any business. He stresses resilience, learning from failure, and focusing on finding one's purpose.

Key Moments

Dragons’ Den Star and Entrepreneur, Touker Suleyman | Full Q&A | Oxford Union

Oxford Union

News & Politics6 min read48 min video

Jun 9, 2022|60,341 views|587|86

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Key Moments

TL;DR

Touker Suleyman lost everything at 27 but bounced back to build a fashion empire and become a Dragon, emphasizing cash flow is king and to never give up.

Key Insights

Touker Suleyman lost an estimated £20 million after a business review revealed overvalued assets, forcing him to start over.

He purchased the fashion brand Ghost and later Hawes & Curtis for just £1, the latter with £1 million in debt, which he significantly reduced.

Container shipping costs from China increased tenfold, from £2,000 to £25,000, significantly impacting fashion industry costs.

Dragon's Den provided Touker Suleyman with exposure to diverse businesses, broadening his investment horizons beyond fashion.

A pitch for 'Generate' (data protection) saw its valuation skyrocket from £600,000 to £25 million shortly after airing on Dragon's Den.

Suleyman believes cash flow is the 'lifeblood of any business' and advises entrepreneurs to be upfront with banks and investors about financial troubles.

An unexpected path to entrepreneurship

Touker Suleyman's journey began not with a grand business plan, but with an accidental entry into the fashion industry. After immigrating to the UK at age five, his family entered the restaurant business. Suleyman initially pursued accountancy, earning a modest £5 a week. However, a chance encounter through his grandmother, who began selling clothes he brought home from a client audit, sparked a realization of the fashion industry's potential. This led to a snowball effect, and by the age of 21, he had inadvertently made his first million. By 27, he was chairman of two public companies, operating in a less regulated financial landscape than today.

The dramatic fall and the lesson of due diligence

The dizzying success of his early twenties culminated in a significant downfall. As chairman of a public retail company, a review by Coopers & Lybrand revealed that the company's reported net assets of £20 million were actually a deficit of £20 million due to overvaluation and fraud. This financial catastrophe had a ripple effect, impacting all his private companies. Suleyman lost everything, including his house, which he sold to repay the bank. This period was a harsh but invaluable lesson in the importance of thorough due diligence before any acquisition. He emphasizes that in his youth, the market felt like the 'wild west,' driven by stockbrokers who could manipulate share prices with a phone call. Today's financial environment, with its extensive networks of bankers, accountants, and VCs, is vastly different.

Rebuilding with property and acquiring iconic brands

Undeterred by his financial ruin, Suleyman rebuilt his fortune by focusing on manufacturing clothing for the high street and, crucially, investing heavily in commercial property. He highlights property as a sound asset in the UK, provided it's managed with prudent borrowing and strong cash flow control. This strategic move allowed him to grow steadily until he decided to acquire his own brands. His acquisition of Hawes & Curtis for a nominal £1, despite its £1 million debt, is a testament to his negotiation skills. He engineered a deal with creditors, settling the debt for £100,000. He later acquired the fashion label Ghost. This period demonstrated his ability to turn around struggling businesses through astute financial management and strategic brand building.

Joining Dragon's Den: A broadened perspective and a powerful network

Suleyman's transition to television personality as a Dragon on 'Dragon's Den' was initially unexpected. He was approached for an interview and, despite initial reservations, accepted the role. After eight years on the show, he notes that it has significantly broadened his horizons, exposing him to a wide array of businesses beyond fashion, including those in the baby, coffee, cycling, and knitting sectors. Beyond investment opportunities, he values the show as a powerful networking tool, providing access to key individuals across industries. While on-screen interactions can appear competitive, he stresses that off-screen, the Dragons maintain friendly relationships. The show's editing process can sometimes misrepresent interactions, as was the case with a comment made to a younger Dragon, Stephen, which was taken out of context.

The perfect pitch and advice for aspiring entrepreneurs

Suleyman considers 'Generate,' a data protection company pitched by Janelle S. Jones, as one of his most exciting investments due to its exceptional presentation. He describes it as the 'best pitch' he has ever seen on Dragon's Den, citing its accuracy, clear articulation of the business model, market potential, and a strategically low valuation designed to attract investors. For aspiring entrepreneurs, he emphasizes the importance of believing passionately in one's idea, identifying a unique selling proposition (USP), and understanding whether one is disrupting or reinventing a market. He advises against seeking VC or family and friend funding too early, suggesting entrepreneurs retain significant equity (at least 50%) to maintain motivation. A clear plan, even for pre-revenue businesses, is crucial for demonstrating market intent and potential.

Navigating inflation and the enduring importance of value and quality

The fashion industry faces significant challenges, particularly inflation. Suleyman points to a 'perfect storm' of rising costs, including a tenfold increase in container shipping costs from China (from £2,000 to £25,000), increased raw material and energy prices, and higher labor costs. This marks a shift from two decades of deflation in fashion to a new era of inflation, which he predicts will exceed 10% in the next 6-12 months. To counter this, he stresses the enduring importance of providing good design, quality, and value. Brands like Hawes & Curtis, offering multiple shirts for the price of one from competitors, remain appealing because customers are willing to pay for perceived value. He believes these core principles of value and quality will not change.

Cash is king and the resilience of the entrepreneur

Throughout the discussion, Suleyman repeatedly stresses that 'cash is king.' He defines entrepreneurship not just as having an idea, but as possessing the willpower to pursue it. He advocates for resilience, stating that failure is a result, not an endpoint, and encourages entrepreneurs to learn from mistakes and persist. He shares his personal journey, highlighting his 'down to earth' approach, having built his businesses through 'sweat, blood, and tears,' rather than relying on speculative ventures like Bitcoin, which he views with skepticism. His advice for entrepreneurs facing cash flow problems is to be upfront and seek help from banks, friends, or family early on, rather than hiding from the issue.

Finding purpose in uncertain times

Reflecting on his extensive career, Suleyman advises that life is about looking forward, not dwelling on regrets. He acknowledges that while he has a strong 'gut feeling' for evaluating entrepreneurs, hard experience and personal decision-making are the greatest teachers, outweighing theoretical knowledge from business books. In today's uncertain times, he emphasizes finding one's inner purpose as the most crucial element. He uses the example of the Alibaba founder's early rejections to illustrate the importance of perseverance. Ultimately, he believes that with determination, passion, and purpose, individuals can achieve their goals, especially when considering the more challenging circumstances faced by others globally.

Mentioned in This Episode

●Products

●Software & Apps

●Companies

●People Referenced

Touker Suleyman's Entrepreneurial Guide

Practical takeaways from this episode

Do This

Always do your due diligence before acquiring something.

Identify gaps in the market and look for ways to improve existing products or services.

Focus on providing good design, quality, and value for money.

Maintain strong cash flow and plan for it meticulously.

Be upfront and communicative with banks, friends, and family if facing cash flow issues.

Believe passionately in your business idea and its unique selling proposition (USP).

Come to pitches with a clear plan, even if pre-revenue.

Prioritize the entrepreneur's character and capabilities when making investment decisions.

Embrace new trends and technologies while holding onto core values like cash management.

Find your purpose in life and never give up on your goals.

Avoid This

Do not get overconfident after early success; the market can be volatile.

Avoid investing without proper due diligence, as the city can be deceptive.

Do not feel overwhelmed or out of your depth; utilize your intelligence and privilege.

Don't give away too much equity too early when raising money.

Don't hide from cash flow problems; communicate them openly.

Don't solely rely on formal education; hard experience is crucial.

Don't give up after failure; see it as a result and a learning opportunity.

Common Questions

Touker Suleyman made his first million by accident at the age of 21. He initially worked in accountancy but was drawn into the fashion business through his grandmother, which led to a rapid accumulation of wealth.

Topics

Entrepreneurship Mindset & Self-Improvement Business & Entrepreneurship Business Strategy Personal Finance Career Growth Fashion Industry Career & Skills Cash Flow Management

Mentioned in this video

People

Sam Jones

The entrepreneur behind Generate, who gave what Touker considered the best pitch in Dragon's Den history.

Sarah Willingham

A fellow Dragon on Dragon's Den, mentioned as being part of the 'new dragons' with Touker.

Deborah Meaden

A Dragon on Dragon's Den, mentioned for her expertise in IP and her friendly rivalry with Touker.

Nick Jenkins

A fellow Dragon on Dragon's Den, mentioned as being part of the 'new dragons' with Touker.

Peter Jones

A long-standing Dragon on Dragon's Den, described as the anchor of the show.

Touker Suleyman

Entrepreneur and Dragon on Dragon's Den, who shares his life story and business insights.

Companies

Loop Generation

A second-hand, upmarket clothing business that Touker is considering investing in.

Coopers & Lybrand

A former accounting firm that reviewed one of Touker Suleyman's businesses, revealing fraudulent overvaluation.

Horse and Curtis

A fashion brand Touker Suleyman bought for a pound and successfully turned around, expanding it to 40 stores.

Boots

A pharmacy and beauty retailer that Touker's team helps small businesses get their products in front of buyers.

Tesla

A company Touker humorously mentions as a potential 'regret' for not investing in, but emphasizes focusing on the future.

Sainsbury's

A supermarket chain that Touker's team helps small businesses get their products in front of buyers.

Burger King

A fast-food chain where the founder of Alibaba was rejected for a job, illustrating the importance of not giving up.

TikTok

A social media platform that Touker admits he didn't understand but is now embracing.

PwC

The successor firm to Coopers & Lybrand, mentioned in the context of a business review that led to financial loss.

BHS

A high street retailer that Touker Suleyman's factories supplied clothing to.

Facebook

A company Touker humorously mentions as a potential 'regret' for not investing in, but emphasizes focusing on the future.

Alibaba

A company whose founder, Jack Ma, famously faced multiple rejections before achieving success, used as an example of perseverance.

Ridley & Co

The company where Touker Suleyman had his first job as an accountant, earning five pounds a week.

M&S

A retailer mentioned as a customer of Touker Suleyman's offshore clothing manufacturing business, and also as food supplier in Bulgaria.

Software & Apps

Ghost

A fashion brand that Touker Suleyman acquired.

Generate

A company pitched on Dragon's Den that manages user data and cookies, offering a share of profits back to the user.

Locations

Ukraine

Mentioned as a place of current suffering, to put the audience's own challenges into perspective.

United Kingdom

The country Touker Suleyman immigrated to as a child and built his business empire.

Cyprus

Touker Suleyman's birthplace, from which his parents immigrated to the UK.

Products

Matchstick Monkey

A baby product company Touker invested in very quickly due to his belief in the entrepreneur and the product.

Media

Dragon's Den

A television program where Touker Suleyman serves as a 'Dragon', investing in new businesses.

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