By Daniel Evans
It was when he was sitting with his fellow Dragons nearly 20 years ago that Theo Paphitis got involved in a competition which inspired him to launch #SBS Small Business Sunday, his networking group for founders. Paphitis explains: “Twitter was becoming more important and we were all on the set of Dragons’ Den creating our own accounts. We had a competition during the day to get the most followers and, by the time I got home, I had 50,000. If I had that when I started off, it would have been amazing. I could contact 50,000 people and tell them about my services. Wouldn’t it be great if I asked these guys if they ran small businesses and then I could re-tweet them to my 50,000 and connect them.
“So I sent a tweet out saying that I would retweet six people who tweeted back with their business. My phone went nuts. It took a couple of hours to go through everything and I retweeted six. The following Sunday, I didn’t send a tweet out but people just saw the old one and, bash, my phone goes mad again. That’s how it all started and now it happens every Sunday but rather than retweet them on a Sunday, we go through it all on a Monday.
“We now have 4,000 businesses in the Small Business Sunday network, which is amazing. We get together once a year somewhere in the middle of the country. We’ve got some great sponsors so the event is free to members. Small Business Sunday started in 2010 so we’ve been going for 14 years now and it’s still growing. I love spreading the word about small businesses.”
Paphitis, who was speaking at SME XPO, the Evening Standard’s annual event for start-ups and scale-ups in London, encouraged his audience to take AI seriously. “It’s such a strong tool,” he said. “Everywhere you look, you’ll be able to use AI. It can break down so many costs and barriers that a small business cannot afford. It allows you to grow your business a lot, lot faster. People should get well versed in it – or make sure they know someone who is – and start using it. You will not be able to operate your business in the very near future without AI. AI has halved our customer services costs.”
The businessman, who owns Ryman, Robert Dyas and Boux Avenue, joined Dragons’ Den in 2005 and stayed for eight years. “It was a competitive environment,” he says. “I chose people I wanted to work with. It became clear to me that I’d rather work with a good person with an average idea as opposed to someone I didn’t rate but had a really good idea.”
Paphitis recalled his early days as an entrepreneur. “At the beginning, there was me and a young lady I hired from the local business jobcentre as a secretary in a tiny office. And the reason I needed a secretary who I could not afford is quite simple – it is because I am dyslexic so it would have been impossible for me to cope without somebody doing all my letters etc. As a small business, I know how hard it is to actually break through and get onto the next stage. I recognise the loneliness we can all feel as a small business.”
He went on: “I don’t think there’s ever a Eureka! moment in business. It’s slow, it comes gradually. You don’t become a millionaire overnight unless you win the lottery. Business success comes in steps. An overnight success is rare and the ones that do become overnight successes, it’s taken years and years to happen.
“There are some terrible statistics which say that 50 per cent of all business start-ups fail in the first two years which goes to show how much more education we still need to help people start up and not fail. If you do have a reversal, the important thing is to learn from it and make sure it chisels you into the person you want to be. Do your homework, know your business – know it better than you competitors. Why would anyone want to compete on a level playing field? It’s not cheating to know more about your industry than your competitor and use it to your advantage.”
Paphitis, clearly now an accomplished public speaker, was asked whether or not it was important for entrepreneurs to be confident. “The answer clearly is no but it really does help if you are,” he said. “You don’t want unwavering confidence that makes you look stupid but you do have to not be shy. You have to be able to stand up and account for yourself. You do have to go knocking on doors and breaking down barriers and if you can’t do that, you’ll find it tough. I wasn’t a confident child at school because of my dyslexia so I was frustrated. I was terrible at interviews. My mouth would be completely dry and I wouldn’t be able to breathe, hence I couldn’t get a job. So I had to work at it and, slowly, it comes and it makes a massive difference if you are running your own business. Don’t be shy and don’t take no as the first answer.”
Looking to the future, Paphitis predicts turbulent times. “The rate of change in business at the moment is nuts, especially in my sector, retail,” he said. “When I started, the cost of entry was huge. Now people can compete with you from their bedroom and reach all around the world. And the way you do business is important. The biggest successes I’ve had have happened with doing business with people who I now consider to be my friends. Doing business in the right way and growing that business with trust is very important. A short-term quid can be a very expensive mistake.”
Everyone who owns their own business knows times can be tough but, in closing, Paphitis had some words which, maybe, you should cut out and keep in your wallet. “When you start your own business, the sky’s the limit – you could be anything,” he enthused. “I can’t tell you how jealous I am of people who start out with that feeling. The world is their oyster.”
