Family businesses - to carry on or branch out?
- 20 September 2012
- From the section Business
They say you can't choose your family, but you can decide if you want to stick with the family business.
Brought up in the Australian outback on the family farm, Dare Jennings was lured to the culture and noise of the city, but he went there armed with the entrepreneurial mindset of a farmer.
"As a teenager being stuck out driving a tractor around in ever-diminishing circles was not really what I had in mind for my life, but to be a farmer is probably the most brutal form of entrepreneurship there is because you live with this endless sense of doom," he says.
"It's not going to rain or it's going to rain too much, or there's going to be a disease in your cattle or something dreadful is always around the corner."
After dropping out of college and drifting for a while, Mr Jennings got the inspiration for his surf clothing company Mambo when he saw someone wearing a T-shirt he wanted which had already sold out.
He taught himself the art of screen-printing, began to make T-shirts and founded Mambo in 1984. It quickly grew into an international phenomenon and he eventually sold the company in 2000 for almost $12m (£7.4m).
His latest project is Deus Ex Machina, set up in 2006, as a custom motorcycle company which celebrates the legacy of the motorcycles created in the 1940s and 1950s.
At the other end of the spectrum to Mr Jennings is Ajay Piramal, chairman of the Piramal Group.
Unlike Mr Jennings, Mr Piramal embraced his family company, though his rise to chairman came unexpectedly early at the age of 29 following the tragically early death of his father and brother.
At the time, the family textiles company was being crippled by industrial action and in severe debt.
Mr Piramal took the radical decision to move into pharmaceuticals and set about transforming the group into one of India's biggest conglomerates, with a presence across 100 countries.
It was a brave gamble.
"We went in a heavy investment mode and when we started investing most people actually questioned us," he says.
"I still remember most of my friends and colleagues in the textile industry thought that this was crazy... and pharma people thought 'What would this outsider who doesn't know a thing about drugs do?'
"So that was a good position to be in. Nobody thought I'd be successful."
In fact, he was so successful that in 2010 he received an offer of $3.8bn from US pharmaceutical giant Abbott Laboratories for Piramal's generic drugs business.
After much deliberation, the family decided to sell and has since moved into research and development of new drugs.
While the group is now a far cry from the textiles-centric business it started off as, Mr Piramal would never have dreamed of renaming it.
"It is the family name which is the strongest brand which attracts investors, it attracts lenders as well as customers. They have a certain level of confidence if they see that brand," he says.
Mr Jennings agrees that branding is key. His companies always appeal to a specific group with the focus on creating a memorable brand and a desirable product.
"The way I think a brand should operate is that they should become a culture and they should be a culture that somebody can decide to subscribe to or not to subscribe to.
"I think the trap for brands is trying to be all things to all people. Polarisation I think is my favourite form of brand building, where if you really annoy a lot of people another whole lot of people will really like you."
Two men from totally different cultures and business backgrounds, they both think outside the box and share a determination to go against the grain.
As Mr Jennings puts it: "Whenever conventional wisdom tells you, that you must not do something, I think that's the perfect time to get stuck into it and kind of make it work."
The Ideas Exchange is an eight-part series, starting on 1 September, broadcast on BBC World News on Saturdays at 02:30 and 15:30, and Sundays at 09:30 and 21:30 (all times GMT).
Every week, two international business leaders meet to talk about their different experiences of global markets and business.