We love a good risk-taking, rugged, entrepreneur, and Richard Branson is exactly that. Today Connor and Brittany tell the story of Branson’s many entrepreneurial ventures and how he has revolutionized every industry he’s ever worked in.

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• How Richard Branson’s Adventure Capitalism Disrupted the Music and Airline Industries
  

Here’s a transcript of our conversation:

Brittany: Hi, Emma.

Emma Phillips: Hey, Brittany.

Brittany: So I love a good renegade or like a rebellious entrepreneur, right? It’s why Connor and I have talked about Elon Musk so much. we love, he’s just, you know, no-nonsense. They’re not putting up with anybody telling him what to do. And these are those people who don’t play by the rules and by doing so, they bring the most innovative products and services to consumers. You know, like you and I, and we’ve talked about so many of them in the past, but I wanna talk about one in particular, today, who I have a crush on. He’s one of my favorites, and that’s Richard Branson. And Branson is a man who has worn so many different entrepreneurial hats, but each one is just as exciting as the next.

Emma Phillips: And I believe he’s referred to sometimes as an adventure capitalist, right?

Brittany: Yes. And I love that name because he’s an adventurer. Like that’s the best way to put it. In fact, one of my favorite quotes from him is, life is much more fun when it’s filled with adventure and saying yes to new experiences.

Emma Phillips: I love that. I also read somewhere once that his high school headmaster took him aside and predicted that he would either become a millionaire or wind up in prison. And the joke was on the headmaster because both scenarios actually came true. But we’ll get to that a little bit later.

Brittany: I love that part. He’s so great. So whether he’s traveling around the globe in a hot air balloon, which he did a feat that actually nearly got him shot down by the Chinese Air Force, which we put, we’ll put a link to that story in the show notes, or starting his own airline on a whim, which is my favorite story. And we’ll get there. Branson never Shies away from risk-taking. And is, Connor and I have talked about in a lot of episodes, and I’m sure you know Emma, like risk-taking is such an important part of entrepreneurship. It’s the people who take risks, who end up being, you know, the real innovators, the real revolutionaries. So his love of adventure coupled with this desire to provide alternatives to conventional ways, right? The regular ways of doing things, that’s what helped him become a disruptor. His, like what I like to call it, of industries. And now he’s a billionaire, so it works. So it’s 16, he drops outta school and you’ve heard, you know, Connor and I talk about school where it’s not always what’s, what’s necessary for everyone. So it’s 16, he drops outta school and he starts an independent newspaper and he’s encouraging students to think for themselves. And this was during the Vietnam War, which we haven’t talked about yet, but I think we need to do an episode on that. Yes. Cause that’s also a good topic. But he started speaking out against the atrocities, the bad things happening with the Vietnam War. And so he was providing alternatives to what were already around. And that’s what good entrepreneurs do, right? They create mm-hmm. Better versions of what already exists.

Emma Phillips: Exactly. And that’s what made him start Virgin Records. He wanted other students to be able to hear new music that wasn’t part of the mainstream, wasn’t what was getting played on the radio. So he started a mail service where people could send a letter and money requesting to hear new music, and he would send them records back. He was also able to do it at an affordable price. This kind of sounds like Netflix in the early days,

Brittany: Right? It does.

Emma Phillips: You would get the DVDs. Yeah.

Brittany: Okay. Our listeners probably don’t even remember when Netflix wasn’t streaming. You used to get physical DVDs in the mail. Yes. And this was before Spotify or all these other streaming services. So, yeah, exactly.

Emma Phillips: Yeah. And, this is how he described Virgin Records. He said nobody had sold music cheaply before, so we discounted it by 10 to 30% off. And we sold music that we loved. So Frank Zappa, captain Beef Hart.

Brittany: Never heard of him.

Emma Phillips: I have not either. Captain Beef Hart, that’s a new one. he said it was rock and roll music. The public loved it. It resonated with young people. We had good taste and we were aiming at kids with good taste. Man, that sounds like a good, like Spotify playlist that you come across and you discover it and you’re like, man, there’s so much good music in here. Right. can you imagine how cool that would be before that existed to happen?

Brittany: There’s nothing like it. Yeah. Yeah. It’s incredible. Yeah. And as we mentioned before, you know, he’s a bit of a rebels. You can kind of tell from all these stories and this part, this part’s really funny. So he actually found a loophole, and this is happening in Britain, by the way. I don’t think he lived it. He didn’t live in America at this point. So he found a loophole that allowed him to avoid paying a 35-cent tax with the record company. And I think that’s pretty genius. I like finding a good tax loophole. Unfortunately, it got him busted eventually. And Justice’s headmaster predicted Branson, who was only 19 at the time, ended up spending one night behind bars. his mom actually in court even offered to like, put up their family home for sale if the judge would just like let him out. And luckily he was told he would avoid criminal charges so long as he was able to pay the fine that they gave him. Otherwise, he’d have to spend three years in jail. And as I mentioned, his mom offered to put up their house as collateral, and that’s actually how he ended up getting off the hook. Wow. So really cool that he had supportive parents, but instead of getting discouraged by this Branson uses to fuel the expansion of Virgin Records, he was like, all right, you gonna keep me down? Like, I’m gonna go even further. So in order to keep, to pay off the fine pays mom back and keep himself outta jail, he basically, he had to open 30 to 40 new record stores and it’s like, oh, that’s no big deal. That’s huge, right? Like, people don’t do that. Wow. And the circumstances may not have been ideal, but he later actually thanked the excise and customs that’s like the tax people for giving him this incentive. And we’ve talked about incentives so many times on this show, you know? it gives you motivation to do something. But he says that running with the law is what inspired him to grow the business because he had to pay off his fees. So that experience really sparked a new passion for Branson. And, it was the beginning of a kind of active activism for bail reform. He does a lot of bail reform activism now. and we’ve talked about that before, but that’s a conversation for a different time.

Emma Phillips: Yes, definitely. We will talk about that more. So he’s only 19 at this point when he gets out of jail, which is pretty incredible to think about what he accomplished. But when does Virgin Airlines come into play?

Brittany: So this, I know I keep saying this is my favorite part because I love everything about his story, but this is my real favorite part. So, it’s been a week since he’s seen his girlfriend and he was sitting at an airport in Puerto Rico and he was waiting for his flight. And any adults had the parents ever had to fly in, you know, deal with, delayed flights. It’s a pain. So he’s waiting for his flight home, from the British Virgin Islands, and I think it’s British Airways, or no, it was American Airlines. They announced that they’d be delaying Branson’s flight until the following morning, cuz there weren’t enough passengers signed up. But Branson was like, wait for a second, I wanna see my girlfriend. I paid money to fly out. Like, no, you’re not gonna postpone my plans. So in true Branson form, he quickly began to think about alternative plan and he didn’t even know if this would work, but he crossed his fingers and he was like praying that his credit card would be approved and he rented a plane from the airport. Wow. And he later said, I had a beautiful lady waiting for me in, you know, the British Virgin Islands. And so I hired a plane and borrowed a blackboard and as a joke I wrote Virgin Airlines on the blackboard. And then he said $39 one way to the British Virgin Islands. and then he went out around all the passengers who’d also got their flights, like canceled the same people on the flight and he actually rounded up people to get on his plane. Wow. Yeah. And his Branson and all the other passengers were about to land. So basically he got them all eight or you know, he got them all there by eight or nine in the evening. He said one passenger came up to him, he’s like, Hey, if you sharpen up your service a bit, like you should just start an airline business.

Emma Phillips: Wow. That is such a cool story of just innovation. He saw there was an opportunity and he took it. I wonder if you could still just rent a plane from the airport out at short notice like that.

Brittany: Post nine 11? I don’t know that you could. Yeah.

Emma Phillips: Probably not. Yeah. Well, now we know how Virgin Airlines exist. So obviously he took that advice and he got into the airplane business.

Brittany: He did. And the idea intrigued Branson. So obviously he was tired of airlines bumping his passenger or bumping passengers all the time. And he thought he could do a better job. And that is a key thing of entrepreneurship. You know, we’ve talked about that so many times on the show that knowing you can do something better, that you can offer something better. And he did that with the student magazine. He did it with his music company. So he saw this opportunity to create an alternative airline and he did it. Now, the only real hurdle standing at Branson’s way was the fact that he wasn’t actually in the airline business. Right. So he wasn’t scared to shy away from risk, but he didn’t really know, he didn’t really know how everything was gonna go. And so he didn’t even know how to buy like an airplane. So eventually Boeing, who he’s like the biggest maker of airplanes they agreed to give him a plane for the first year. and he was gonna turn into Virgin Atlantic, which he actually ended up doing. But in Branson’s view, even though this was a huge risk, cuz he didn’t even know if he could be able to pay for the plane, by the end of the time this Luis was up, he wanted to take the risk, he wanted to see if he could give it a shot. And actually Boeing agreed to everything. He ended up returning the plane at the end of the first year, ended up being able to buy more planes and the company was such a like success that British Airways actually like, became pretty bitter. And they tried to put them out of business.

Emma Phillips: Of course, they didn’t like a competitor. That’s, how it works. Yep. It it’s better for consumers though.

Brittany: Yes, exactly.

Emma Phillips: You mentioned something before we started recording this that I found really interesting. Virgin Atlantic was mocked as British Airways question why on earth someone in the entertainment industry would ever start an airline. But that was exactly what gave Branson his competitive edge. Cuz passengers spending hours in a cabinet, or not in a cabinet, but in a cabin like not in a cabinet, in an airplane cabin, they wanted entertainment. And that’s where all these other airlines were lacking. It was, it was a boring experience, but when it came to entertainment, Virgin Atlantic took things to New heights. The captains and crew members used humor to make boring announcements more exciting. And Virgin is credited with the creation and adoption of the Seatback screen. So if you’re listening and you’ve ever been on an airplane and had a, like a TV plane, a movie or something on the back of the seat in front of you can thank Virgin Airlines for that. So on its Maiden Voyage, its first Voyage Virgin showed the film airplane to its passengers, which was a testament to its sense of humor.

Brittany: And that’s old, I guess we should probably mention airplanes like this old parody movie about like an airplane. it’s probably not even funny to kids nowadays.

Emma Phillips: I’ll be honest, I haven’t seen an Airplane.

Brittany: And I think I was allowed to see it once. I don’t remember, but sorry to cut you off.

Emma Phillips: All good. Yeah. But anyway, British Airways was not very happy with how successful Virgin was. And the company launched what would become known as the Dirty Tricks campaign. And they were obsessed with trying to soil the reputation of Richard Branson and his company. And so this competing airline organized a team who illegally wiretapped their phones and computers of the Virgin Airlines Company. So they got access to all of that passenger information. they would call passengers pretending to represent Richard Branson and represent Virgin and they would tell passengers that their flight was delayed or canceled, but that British Airways would happily get them on one of their flights. So convenient, but in the end, Branson prevailed and his airline continued to be his success.

Brittany: That’s so crazy about like the airline doing that. That always like makes me so mad, but so it there’s two airlines. So he had Virgin, I think Airways or airlines and there was Virgin Atlantic. Now the problem is his international airline is still up and running, but because America has very silly laws and it’s something like, I think it’s like foreigners can’t own more than 51% of an airline operating out of America if they’re not American. So Branson isn’t it so silly? So Branson’s actually forced to sell, his Amer, oh I can’t remember, was it Virgin Atlanta? I can’t remember which one it was. Here, I’ll put it in the show notes. But he actually was forced to sell it to Alaska Airlines. So, now we don’t have it. I think there are some flights you can get, but it’s not like run by him anymore. So he, to give away some of it. Yeah. Which is very upsetting to me cuz I loved, I don’t if you ever flew Virgin, but it was the best airline. It was like hip, you went in and it was like a nightclub. Like the lights were off and they were like, so like, it was a dark airplane, but there was like pink and yellow lights. Like it was, it was my favorite. But, you know, that never stopped him from innovating. He’s still innovating and on multiple occasions, he’s actually tried to break world records by traveling long distances in a hot air balloon. As I mentioned earlier, he’s also tried to break a record for the fastest trip across the Atlantic. And I think that ended like in his boat, right? Like a boat sunk or something. And a crew needed to be rescued and like he’s always on these crazy adventures, but he never seems to fail. And so we’ll end the story there when we post the links, but I don’t know, do you have any final thoughts? I’m, after hearing all these really cool things about Richard Branson,

Emma Phillips: I’m just inspired when I hear stories about people who just have a cool idea. Yeah. It all started by just sending people records in the mail. Yeah. And to go from that all the way up to owning an entire airline is just, that’s so inspiring. And to me that’s something that really you only see happen when people are free to try things and maybe fail, maybe have things that don’t work out but might just work and they may just be awesome and give people a great experience and a great product. So I’m glad this guy’s out here inventing things and I’m excited to see what he does next.

Brittany: Me too.

Emma Phillips: Yes. Well, we will, talk to you guys later. Be sure to check out the show notes at Tuttletwins.com/podcast and we will talk to you next time.

Brittany: Talk to you next time.