Interview with Simon Woodroffe – Founder of YO! Sushi
What do you do when you’ve been a roadie, a stage designer and a TV executive, have got to the age of 40, nearly run out of money and are unemployable with a family to support?
You start a conveyor belt sushi bar. That’s what Simon Woodroffe did. Inspiring and definitely unmissable.
Simon Woodroffe OBE (born 14 February 1952 is an English motivational speaker and entrepreneur. He started the sushi chain YO! Sushi in 1997,and appeared as a “Dragon” on the first UK series of Dragons’ Den. Woodroffe conceived and launched YO! Sushi after an early spell in television. The business established conveyor belt sushi bars featuring call buttons, robot drinks trolleys, Japanese TV, self-heating plates, and other such novelties.
He currently speaks around the world at corporate and promotional events, and has appeared on stage at the Edinburgh Festival to discuss his YO! ventures including YO! Company.
Can you tell me about your background before you started YO! Sushi?
I left school in 1968, just after the first ‘Summer of Love’. We used to make peace signs because we meant it and smoke joints. The 60s was a really changing time in the world. For the first time people who were under forty years old – namely The Beatles and Jimmy Hendrix – had made it onto the front pages of newspapers, so it was a very exciting time to live in. We thought we were changing the world. It was a time when the word ‘hippy’ had quite nice connotations, which I suppose it doesn’t now.
I left school and went out into the big wide world and thought, ‘This is great’. I got my first job as a bus conductor and then worked in a factory and did all sorts of little things like that. After a couple of years I thought to myself that I’d really blown it. I got busted for possession of drugs, and although I wasn’t particularly guilty they decided to make an example of me.
I was at Cambridge Technical College and I got sent to a detention centre, which of course was unheard of for someone coming from my background. I served three months in Her Majesty’s Detention – the same place that Jeffrey Archer later went to when he was in his open prison. I met Jeffrey Archer the other day and I told him about that. There was a very long silence and then he said, ‘Not a lot of people say that to me at a cocktail party’.
When I came out I was eighteen and had a criminal record and no qualifications. I wondered what the hell I was going to do and I really felt the pressure. I remember getting a copy of Farmers Weekly and thinking, ‘maybe I can be a farmer or motor racer today’. One of the magazines I got was The Stage newspaper and I got a job from the back page as the assistant to the assistant stage manager at The Little Theatre Club in St Martin’s Lane in London, which was one of the very early fringe theatres.
I didn’t have any real background in that but I thought it sounded quite interesting. I became the stage manager and went on to work at the Royal Court at the Richmond theatre. I eventually went on the road when rock ‘n’ roll came along and I became a roadie. From being a roadie I became a stage designer. And that was my first break.
I designed a lot of the big rock shows all the way through the 70s and 80s, right up to Live Aid, and my company was involved in designing it. I remember getting to Live Aid and thinking ‘I’ve got to get out of this business before I get found out’. So, there I was in the middle of the 80’s, lost – so I went into the TV business, where I sold television rights. I was coming up to the age of forty and in 1995 I thought, ‘If I don’t do something now I’m going to run out of time. I’m going to be a sad old git and I’m not going to be successful’. I had just got divorced and I didn’t have a great deal of money, and that’s when this guy told me about Japanese conveyor belt sushi.
Did you ever resign yourself to the fact that you weren’t going to be successful before you started YO! Sushi?
There was definitely a time when I suspected that I had left it too late and that things had gone wrong. When I did have that realisation I became very driven and I decided that I was not going to go down. I’d got to earn a living and I had got to do something. Once I had that sort of drive whatever I did would have been successful.
What’s your attitude to what some people refer to as failure?
I know that you can only become successful by failing. All the accountancy firms are always trying to find out what makes entrepreneurs tick and do things successfully.
The only thing that I have ever found that is common to just about all successful people is that successful people don’t spend their whole day succeeding. Successful people are actually willing to pick up the phone to make the call when they are going to get rejected. It’s like going and asking somebody of the opposite sex out. The people that are most successful are the ones that are willing to fail.
You have to be willing to fail knowing that it’s not about you and knowing that that girl is not saying she’s not going to go out with you because she thinks you’re an ugly loud-mouth prat. It’s just as likely that she has just broken up with someone else, she had a bad time this month or that her mum had an argument with her. Once you know that the same principle applies in business, you stop minding about failing all the time.
It’s a well-known story now but I have always had this belief that if successful people fail then one of my goals is to fail. So I have set daily goals to fail. If I’ve been looking for money or properties I say I’m going to phone six people up and when I get rejected six times I’m going to punch the air knowing that only true failure is a path that leads to success. Because if you ask fifty entrepreneurs and they say no, then there is a good chance that the fifty-first is going to say yes. But if you don’t carry on then you’re not going to get it.
Is there anything you would have done differently?
I think one of the things that I would have done is to have the courage to spend more money earlier – especially on employing better people. I was paying the minimum because I wanted to keep my costs as low as possible. I should have handed over more power to better quality people.
What do you value most?
You would probably get a different answer from me each day of the week. I value the freedom that having money and having good people around you buys you.
Did you come up against any challenges when you were trying to get funding in the beginning?
No, getting funding is easy, you just ask for the money and they give it to you! (laughs). I was willing to put everything I had on the line and I had £150,000 from my flat to put into it, which was my only asset in the world. But I thought that if I opened a £150k restaurant I would get some little restaurant that would be no big deal – I would be working and serving in the kitchen. I wanted to do a much bigger thing; I wanted to do something that was nearer a million pounds, or certainly half a million anyway. I didn’t have the money to do it and obviously I had no security so the bank wouldn’t lend me anything.
I looked around and talked to venture capitalists. I was much too scary for them so I went and talked to a lot of the private investors. I don’t blame them because today I’m one of them but they sat on the sidelines and thought, ‘Who is this guy with an unproven track record that doesn’t know anything about restaurants?’ A few of them did say that maybe it was a good idea, and they thought they would watch and see how I got on with it.
But I just took it ahead and ahead and ahead. I had my £150k which was ticking down because I had started working on the idea; I was living on very very little. I never went out for dinner, never took a girl out to dinner, and I just lived off the absolute minimum to keep me going. I had it roughly planned that I would just live on that money for a year. I used to walk miles to find a cheap photocopier where you could pay 4p instead of 10p. I knew all the places to get things done very cheaply.
I managed to persuade my bank to give me a £100,000 loan – which was part of the government loan guarantee scheme – so I was then up to £250k. I sold 10% of the company to a childhood friend, and 10% to a bloke I met on the street in Paris for £50k – so I was up to £300k – and I lined up some very very expensive leasing on the kitchen equipment.
I still had much less than all the money I needed, but I went ahead and signed the lease and did the deal with the bank. I didn’t tell them that I didn’t have all the money in – I insinuated that I had it in place – and I signed the lease on Poland Street in Soho and managed to get to opening without having all the money. Within a week of opening we had a queue down the street.
We were taking lots of money but I owed a hell of a lot and I didn’t have the money to pay my bills. By this time, because we had a queue down the block, the private equity investors were coming out with their cheque books and I was going to give half of the company away to them. Clearly I could have got the investment at that point but I did the right thing and stayed way ahead of the money. Rationally I knew it was all very high risk but emotionally I felt it was going to work, so I went to one of my biggest suppliers and he gave me extended credit and I never needed to get those private investors in.
On the front door of that first restaurant we had the names of three sponsors. I thought that when Sony had given me some cheap tellies I’d make them my sponsor and give people more than they could ever dream of. Honda motorcycles lent me one of their motorbikes and so I decided to do the same thing with them.
How did you do that?
I just went and asked them. At Honda motorcycles I remember asking if they could supply me with motorbikes for YO! Sushi with the roofs on them and with YO! Sushi written all over them. They said, ‘Oh no there’s no market for those’, and then the guy I had made friends with said, ‘I’ll lend you one, we’ve got one in our warehouse – tell us what it’s like, it will work for deliveries’.
When I went to Japan to do the research, Omnicom Airlines upgraded me and I thought their name would look good on the door, so I put it up and said thank you to them. I had all these sponsors’ names up which was unheard of in a restaurant. Later on when I asked the guy who gave me extended credit why he let me off paying for that period of time, he told me that the board at his company had said that it was because they believed that I had all these Japanese companies backing me. They thought that I was safe as houses because they would never let me go down, so I was very lucky.
So when you approached Sony, what were you actually asking them for?
Initially, I asked for a discount on the TVs and eventually I got them to give them to me. Sony consumer products UK are down somewhere in south Cheshunt and I managed to get a meeting with them. They thought it was just an odd thing. I said, ‘Look, I’m doing this Japanese thing and you’re a Japanese company. It’s this restaurant of the future and it’s very cutting edge with a conveyor belt’. They just wanted to find out about it. So I got in the door and asked them to supply all this stuff to me for free. They told me they don’t do things like that – apparently they get loads of similar requests.
They ended up doing it without a contract and without a letter, they just sent the stuff over. I think it was just pure persistence, and actually up until about three weeks before the stuff arrived I didn’t know whether it was going to turn up or not, so it was great when it arrived.
I plastered them all over everything and everybody thought they were behind me when we opened. I hadn’t planned it that way, but suddenly when I looked at the place it had so many Honda and Sony signs everywhere. I thought that people would say, ‘Bugger this guy is a really big deal developer – he’s got these Japanese giants behind him. Japan is invading London!’ Of course I had just put their names up…
Did they ever contact you?
Yes. I had a relationship with them afterwards and I told them the whole story and they all thought it was funny. But they are big companies so it is not as if you’re telling the owner of the company – you’re telling one department and they say, ‘Bloody hell, you sorted that one didn’t you!’
Did you do any market research before you launched?
If I had gone and asked focus groups: ‘Do you want to eat raw fish on a conveyor belt with a robot serving drinks?’ I wouldn’t have got very far. You can’t research a market that doesn’t exist. But I was very into sushi and I knew that there were enough people around who would come over to the idea. We had a cult status before we even opened; people really liked it and I just had that sense that it would catch on. What actually happened was that because there was so much excitement and fun in the place, even the people who hadn’t tried it came in and tried it, and then liked it, and of course it had all the health benefits too. Actually, very often I don’t really rely on it for start-ups, because I don’t really believe much of the market research that comes out.
What kind of attitude did you start the business with?
Complete enthusiasm, confidence and belief. I wanted to open a restaurant that would blow my mind. I wanted to do something that I just thought was brilliant. I wanted to do something that came from my creative juices and that I was really proud of. I knew that even if it hadn’t worked something else would have come out of it, because people would have at least walked in and said, ‘This is bloody unbelievable’. So that was really what the whole thing was about. I knew that the food had to be great, and I knew that it had to be very sexy and it had to be outrageous.
In the first restaurant, I covered up all the windows when it was a building site with these great big bits of orange paper that had lots of words on them like conveyor belt, kirin, robot etc. I just used mad words and people didn’t know what the place was going to be or if it was a sushi bar in the making. Soho is a small place and they would all wonder what was going on. The day we took the orange paper down they looked in and saw this conveyor belt going round and these robots. Were we good at marketing? Not really. What we should have spent on marketing we spent on the inside. And when it opened people had to come and see it. Of course they did.
Were you certain you were going to succeed or did you think it was a bit of a risk?
There is always a bit at the back of your head that thinks that. In that first week on the third day when nobody’s coming in, not only are you not certain you’re going to succeed, you’re certain you’re going to fail. There were moments of that, but generally I had a feeling it had a pretty good chance. Then when it started rolling it was fantastic. Almost like having a hit record.
I don’t think you can ever quite believe that it’s going to be that successful, but I could imagine it. If it hadn’t been successful there would be a part of me saying, ‘I really am a complete maverick and my taste is completely different to everybody else’s in the world, because I would have been absolutely down there loving it’.
What motivates you and drives you in life?
I like doing creative things that I think are really really good. The hotel we’re working on now really turns me on because I think it’s just so completely radical and different from anything that’s ever been done. YO! Sushi just turned me on completely because it was so interesting. It’s like when you change your room around at home and you like the way it looks and you can’t leave it because you keep coming back to look at it. For me, building new things and starting new things is exactly that but on a much bigger scale. You look at every detail and you think, ‘Wow, that came out of my mind!’ Innovating is something that really excites me.
Did the YO! culture evolve or was that part of the plan?
I just wanted to open a restaurant to earn a living. But I would say that before I opened that restaurant there was definitely the beginning of a feeling of a culture that was to come out of it.
First of all it’s a very short name – YO! It rhymes with lots of things and people said I could be the next Virgin and start YO! this and YO! that. It dawned on me very quickly that the whole thing worked. There is only so much you can say about sushi or a pizza, so instead of just talking to the press about the restaurant, I started talking about the world and life and my dreams. I talked about how I nearly failed and how I achieved this, and people were much much more interested. Suddenly, I got lots of press because of that and I talked about how I did it and where this mad idea came from.
The whole thing builds and you learn how to just milk that in a sense. But it came from a pretty genuine place and it wasn’t like we had got an advertising agency to think up this brand. We were just doing things for fun. Out of that grew what I suppose is now a culture and philosophy.
How important do you think marketing and brand image is? If someone is starting a new business, do you think they should take out the extra funds to invest in that?
It’s definitely very important, but I don’t think as a start up that you want to manufacture it and dream it up at an advertising agency in order to manipulate your customers. I think that what you want to do is to have fun ideas and have the brand reflect who you are as people.
Do you think that it’s important to gain commercial experience before someone starts a business?
Yes, the more experience the better. I had design experience and I also had experience of running small businesses. The most important thing in running a small business is not to run out of cash – that’s the only thing you have to do in this life in order to survive and become successful. If you run out of cash everything is over. If you don’t run out of cash you can still get up the next day and have a go at it.
I think people of my forty-plus age group are very investable because they have had a lot of experience in the world. Hopefully they have had some good businesses, but possibly ones that have failed. If people say to me that they’ve got this restaurant or retail concept and they ask if they should do it, I tell them they are absolutely mad because the risks are enormous. But then they go ahead and do it and some succeed and some fail.
I think something like 60% to 70% fail, but actually what people don’t look at is what happens to those people afterwards. Even when something fails, I say everything that you have learnt through this will stand you in really good stead. I have never met a person who went out to do what they really dreamed of doing – regardless of whether they later succeed or fail –who regretted doing it.
But I have met many people who look back and say, ‘I wish I had done that’. If you take a sample of very old people and you ask them what they would have done differently in their lives, almost inevitably they will tell you that they would have taken more risks, been more maverick, made more bad decisions and done things that had been their dreams. They wouldn’t say ‘I would have spent more time planning my pension’. Because out of doing those things, people can become the greatness that is in all of us.
Do you think the food and drinks industry is particularly challenging?
I think every business is challenging. The great thing about the food and drinks business is that it’s not rocket science and it’s quite easy to get into. We’ve all eaten and we all know what’s good and what’s bad. I think people think it’s easier if they have an idea. The idea is the easy bit – the hard bit is the execution.
How long did it take you to get from concept to completion?
Two years. I wanted to open it within one year, but if I had opened in one year I would have opened a typical Japanese conveyor-belt sushi bar, and I probably wouldn’t be sitting here today. In the second year a lot of the great ideas happened such as the call buttons and the robots speaking. So spend time, don’t just do things that the market wants, create something that you want so you can quantum leap and get ahead. But I also think that the restaurant business is pretty tough and requires a lot of detail.
How much do you think your attitudes and beliefs had to do with your success?
A lot. People just started to believe me not simply because I had an idea. I came out and said, ‘I’m going to have a conveyor-belt sushi bar with robots serving drinks’. If you have a real passion and enthusiasm and the idea is good underneath then you draw people into you, and people start believing it because what happens is you start believing it yourself.
What types of people do you think are not suited to running their own business?
It is very difficult to run your own business. I think you’ve got to want to do it – you have got to dream about it. You have got to have an imagination and want to do just that. Sometimes what you are doing is a nightmare, sometimes it doesn’t work and sometimes you think you will never get there. But you have got this dream, this picture in your mind of what you are going to create and you are passionate about it.
If you have that picture you are very lucky; I think people who are just cynical shouldn’t start businesses. What they should do is go on a personal development course or try to get some change into their lives, because being cynical stops you achieving anything. You think the world is out to trip you up, so what’s going to happen is the world will trip you up.
Did other people’s negative opinions affect you or make you doubt your ideas?
No. It made me angry when people would say I was wrong; at the beginning a lot of people were doubtful. Sometimes you question yourself when people say that. I never ask people whether I should or shouldn’t do things. I just listen and then that helps me to educate myself. I then go on my gut instinct after it’s been educated. ‘Educated instinct’ they call it.
What advice would you give to someone who is in the middle of a career and is thinking about starting a business?
Consider yourself a researcher, and if you have an idea that you want to research make sure that there is more than one thing on the go at a time. Don’t just do one thing, have a couple or three things going. Then get a notebook and start writing in there, and put a rule on yourself that you are not allowed to think about whether you are going to do it or not – or what the results are going to be – for more than three seconds. Your job is purely to go out and put a small amount of your time – and money that you are willing to lose – into doing the research on this project, so that you can try to get some enthusiasm for it.
At the end, you should know that if you don’t do it that’s fine and you haven’t failed. Once you say, ‘Right, this could be something’, you set yourself a three month target and try to improve 1% a day for a hundred days. Find out where you get to at the end of a hundred days, and at the end make a decision about whether you are going to invest any more money in it. During that one hundred days, continue the ban on thinking about whether you are going to do it or not. Imagine that you’re almost doing research for somebody else.
Would that be the same advice to school or college leavers?
No, it’s different. I would tell school or college leavers to shut their eyes and jump in the deep end. Just get involved in whatever you are doing and put everything into it. Don’t work out exactly what you want to do because it doesn’t really matter – in this day and age you can change what you do so just go and try stuff out. If you can find the money to survive, go and try things for a week in your own version of work experience. Walk in somewhere and say, ‘I’m really interested in what you do – I don’t want any money, I just want to work here for a week and I want to start now’.
When you jump in and give people more than they would ever dream of you find out stuff. Doing things leads to other things; you form relationships with people and people want to help you. You can’t sit around at home thinking thinking you can’t do anything unless you’ve got a certain amount of money. But if you go out there and see people, you can then go and ask people for jobs and for advice. For example, go and find the chief executive of British Gas and invite him out for lunch. Tell him you’re a student and say, ‘I’m really interested in this whole world of gas, would you have lunch with me?” I’ll tell you what, someone will say yes and suddenly you’ve had the best advice in the world. Go and see people and think in a big way.
Where should people look for inspiration for their ideas?
The first place is very close to where you are, but often people start something of their own that they already know about.
The second place to look is everywhere, and one thing I did and I still do is I write everything down. I have various notebooks. This German philosopher Goethe said: ‘When you know where you are going and you are truly committed, the world conspires to help you in all sorts of ways that you could never have believed possible, including the provision of financial assistance’. It’s an amazing concept. You have an idea and money comes along.
I started writing all the good ideas in my Goethe notebook in bullet points. If I was walking down the high street and I saw a good ad or a bad ad I would be constantly writing it down. I would then read back to myself as opposed to sitting around and just thinking about stuff – after a while you get some sense of what’s good and bad. If you just start at the beginning you’ll be thinking ‘What should I do?’ I remember when I left school I got the Yellow Pages out – I didn’t know where to start. I thought, ‘What should I be, a cobbler?’
What are your beliefs about money?
I think they have changed a lot over the years. One of my beliefs at that time was that nobody would lend me money to start the business, so I had to find it myself. Now it is beginning to change to: ‘When you do really good things money just arrives’. That’s a real change in attitude.
What is your biggest fear?
Running out of money and being poor.
Did you start alone or were there specific people you worked with?
Mostly it was just me, although I took advice from accountants and so on. I learned how to draw on a cad machine – computers and accounting. If you’re a start up you need to know everything. When you get bigger later on you can start to delegate things, but when you’re starting out you want to do everything yourself. Pay attention to every single detail. Live and breathe it in your head and you’ll know instinctively what the next call you need to make is.
Is there anything you think people wanting to start a business should know?
Go for it, do it, be willing to fail, be very persistent, have a dream about it, enjoy working hard and learn to enjoy working hard. Don’t have a work life, have a work play balance and make the work play as well. Persevere, it’s not rocket science. I would say get out of your comfort zone, be willing to feel uncomfortable and a bit scared. Because if you’re feeling comfortable you’re not doing it are you?