Episode 51 Show Me the Money

punctured tyre on the first lap. This is Show Me The Money, your

weekly guide to who is making a cash, the way we do it and how we

work. We have looked Johnson, who made his DOH at Pizza Express and

now invests in others' businesses. Emma Jones wants you to set up your

own business, she is fermenter back -- from Enterprise Nation. Paul

Lindley is big on baby food, they'd all be down in Norway. It is Super

Mario to the rescue in Italy. Mario Monti has been asked to form a new

government. He takes over from Silvio Berlusconi, who quit on

Saturday evening to booze, cheers and a string ensemble playing

hallelujah. Dominic lorry has been following events in Rome. His --

Dominic Laurie has been following events in Rome. Mario Monti's big

challenge is to implement cuts and reforms. Yes, 59 billion euros

worth of reforms agreed, the most controversial being a reform of the

pension age, raising it from 65-67 years old by 2026. Also has a

measures like the selling-off of state assets, like former military

institutions, even farmland. So real, huge, wide range of measures

taken. This is on the backdrop of a country that is already feeling the

economic squeeze. You talk to many people here in Italy who are on low

to middle incomes. They say they can hardly keep pace with the cost

of living. Their salary just will not meet their expenses. I spoke to

a man at Rome's market this morning, who had a pension of 800 euros a

month and he said it hardly covers his rent and his bills. So the cuts

are coming on top of pain already. It will be interesting to see

whether Mario Monti will have the support of the people as well as

the support of other parties in parliament as the cuts progress

over the years to 2040. I bet many of those people you were speaking

to were asking why the cuts are necessary to come a superficially

you wonder why Italy has a crisis at all? He did not have a banking

crisis, did not have a property collapse, its annual government

overdraft is less than many of the European nations. Indeed, people

are suspicious of borrowing too much money. There was not a housing

bubble really, so much. The trouble as it is the differential between

the gross rate of the economy and the debts that the government

passed slowly accumulated over the last 20 years. The economy is

growing at an average of around 01 % over the last 20 years or so,

whereas the interest rate that the government was being asked to pay

on its government debt was about six to 7% last week. -- 0, to 1%.

The difference between those two things is what is scaring the

market and led Silvio Berlusconi to resign at the end of the week, he

said to prevent spina -- financial speculation. He has said that in

the last couple of hours. Italy has a bond issue. It has to raise money

as soon as tomorrow, so that is what led to a change of government,

a change of prime minister, so the markets tomorrow morning would not

be scared. Dominic Laurie in Rome. Let's talk to Anna Jones. What is

the impact of this on business, on people thinking of setting up a

business? The mood music that is coming from Europe, should it put

them off? I always referred to small business as the bright spot

of the UK economy and even in the midst of the crisis small

businesses are getting out there, Going Global, traded overseas and

some figures, the UK exports 50% of the eurozone countries but small

businesses are looking beyond the eurozone nations. If they are

slightly scared in terms of are their customers in Italy, Portugal

and Greece, they are looking to say we have huge bases of customers in

China and India, so higher net worth individuals who are coming

into those markets, the world is your oyster. Embraced technology,

have a niche product you can sell to the world, small businesses are

going global very quickly. Paul Lindley runs a small business that

does export to Europe other parts of Europe that do not use the euro

as well. How do you manage the risks in currencies? First of all I

think exporting is a risk, awaited the risk your business. There are

lots of places around the world where economies are growing. A lot

of our costs of goods are in euro, so we look specifically to export

to get income coming in your road, so we set up a euro bank account,

money comes out and in and it self hedges. Any differential, we look

to take future exchange's position so we are not speculating on

currency but have it locked down and know where we can go. How does

it affect your thinking about future investment or your day-to-

day strategy? Is it something that is at the front of your mind or is

it like a dull, ticking... It is at the front of my mind. I take a

simple view. I think people around the world are more the same than

different. Ella's Kitchen, the brand, works here and it will work

in other markets. I need to understand the culture and society,

things that are local, but if you have a great brand and a great

business the way to do you risk your business is to go out and look

globally. -- To take less risk with your business. Luke Johnson, with

the investment background, what impact does the continuing problem

with Europe, Italy and Greece, have on the decisions on investment in

business? Well, two points really, firstly thank God we stayed out of

the euro and have control of our own currency and exchange rates and

secondly I think you have to give it this government that they have

pursued a policy of cuts and austerity which means that a we are

able to issue our guilt set very low interest rates and it means

that mortgage holders under the draft some so forth are at

reasonable levels. If Britain were so tough -- suffering Italy's

interest rates we would be a very serious trouble. Don't low-interest

rates suggest the markets have little confidence that they might

be strong growth in the UK? The expect the Bank of England needs to

keep interest rates lower for longer because the economy is

anaemic? Yes, to an extent, but the point what we need to get close not

from public spending but from private investment and

entrepreneurs, who are trading new businesses and growing the private

sector. We don't want government spending to crowd out private

investment. Thank you very much. We will develop those seen through the

programme. Time now for Boom or Bust, the flick through some of the

more important stories of the week. Starting with this, flights halted,

rush-hour rescheduled, parents paying. The reason? Hundreds of

thousands of students in South Korea sitting a crucial college

entrance exam. Officers opened late so students could arrive at test

centres on time, evening opening hours of the stock market were

changed. Calm down dear. It is only a deer

entering a restaurant, taking diners by surprise! The videos

surveillance camera shows the deer jumping around a bit before

retreating out of the door. Thankfully was not heard. The owner

says the repair bill will be a bit deer. He really did say that, we

did not making it up. Thousands in Chicago watching an extreme sport,

snowmobile jumping. The contestants jump up to 30 feet in the air

renders you can see it isn't a all weathers more -- all the sport. No

snow is required, just a nice bit of carpet.

Let's pick up the first story, that of the exams and South Korea was

Paul Lindley. Paul, this I suppose getting into a discussion about the

skills of school leavers when they take those exams and come out at

the other end. Our schools teaching kids the right things for business?

It is a question I get asked a lot for entrepreneurs and other small

business holders and the general position is, they are not. The

skills that are coming into the market place are not the right

skills for 21st century economy. The skills this time in this

century is about technology, understanding technology, languages,

there are a billion new middle- class Indians and Chinese people

coming into the global markets are being able to trade with them

requires being able to talk in their language. The kids learn

French and German nowadays. There are many people learning Chinese

these days, which are the skills we need. I work in the Thames Valley.

We have an IT industry down there. We have set up an academy for

sixth-form students built around 80 skills, so that is putting the

right skills and the right local economy and that can be developed

further to embrace enterprise zones. In my business we export to Sweden.

There is an area in Stockholm where all the retailers, or suppliers and

all the educators, the recruitment agents, the Academy's, All For

Learning retail and how it works and it brings a tremendous benefit

to that economy and the skill base in it. Is it the job of schools?

think it is the job of schools, of schools and parents. Parents

educating their children, I was saying to somebody, kids are

growing up wired for enterprise. They are great at self-promotion

because they get out on websites and promote themselves. They are

incredibly adept with technology so they are wire for enterprise. What

they need adding his cash, mentoring such as -- from people

such as Luke and Paul, but attaching the other kind of assets

they need to go with the skills. Luke Johnson, you used to run Pizza

Express restaurant. Did you ever have a deer crash through the

front? I can't remember that, no. It did not sidle up to the bar

looking for a couple of extra dough balls? Not my recollection.

business lesson is how you cope with the unexpected in business.

you go into business you should often assume that Murphy's law will

apply and it something can go wrong it well. Were the were building

your own website or constructing a restaurant, or recruiting, problems

will occur and you need to be adaptable and an opportunist and

take advantage of upsides, but also be resilient in -- and persevere. I

think someone who gives up to weaselly is not suited to run their

own company. Bad luck come amiss fortune is one thing, how do you

hope for the people -- cope with the people in your business making

unexpected mistakes? Depending on whether they are deliberate or

negligence, you often feel let down but you carry on. You have to be

relatively forgiving. Business does involve making hard choices and

sometimes that might involve letting people go, which is never

great. But life goes on, generally speaking a business has to be

bigger than any of the individual people within it. Speaking of deer

and food, the stuff used -- cell in Sweden, is there are deer component

to that? Venice and his off, is the line on that. -- Dennis and. A how

do you cope with the unexpected? You plan for the unexpected, but

preparing yourself, practising for things that could go wrong with

strong business continuity plans come strong crisis plans, making

sure you have a skill based around you so when you need them they are

around you. The risks you are taking business in honour of our

snowmobile jumpers, risks that you take? It is not risks that I take,

it is a faster knotting -- fascinating opportunity to say that

starting a business is not high risk. We have global

entrepreneurship week, there has never been a better time to start a

business, you can do it low-cost, holding down the day-job, the best

time to start a business on low risk. We will pick that up, the

best wrist you ever take? starting Ella's Kitchen. You are

working with huge retailers and multinational competition, I

thought I had a plan, an innovative product, a could build a brand, I

did it. Take the risks. You regret things you don't do rather than

things you do do. Luke Johnson? of my favourite phrases is one by

Gen Normacot. There is no security on the Serbs, only opportunity.

you take advantage. You have acquired a special -- speckled,

varied business career, Pizza Express, for a very long time. The

one now in finance, you would chairman of Channel Four television

for a period of time. When you take up these individual roles what

attracts you to them? Learning new things, education, variety and I

suppose flattery. Sometimes you get offered these roles and it appeals

to one's ego. Do they ask nicely? Indeed. You accept. Yes. Many must

play a part. Sure, but in a non- executive post some things like

that, charities one might get involved with, social enterprises,

it is more about it meeting interesting people and

understanding new fields. What give you more fun in your career, the

challenge of a hands-on management of the big business like Pizza

Express, or are you more relaxed now, being a portfolio, more hands-

I think it is a lot easier to play the role I do. But one is still

risking capital and you still want everything to succeed. When you are

investing in a business, are you involved any hands on we? The yes

very much soul. So what attracts you to a business and what it might

set the alarm bells going? I think the main thing are the people. If

you do not trust the individuals, you do not want to get involved.

But if they have the spectacular track record, that is obviously a

very positive thing. Is she right about the idea that we have to

encourage entrepreneurs in this time of austerity? Yes, up after

all, Microsoft was started up in bad economic times, a ball Disney

was started up in the midst of the Depression. The future is started

at the bottom and it is always darkest before dawn. I think that

those who have the discipline to succeed will always do so even when

economic times are not so bright. Is the money out there for people

to invest in? Yes, there are a number of options. There are

clearly banks out there that will also lend money and a number of

private investors. There are devices like invoice discounting.

But it rather than looking for someone else to back your own risk,

should your own money not be on the line? And I do not think you need

to have too much at stake. I think the amount of time and effort by

you are devoting to a cause should be enough. The Bank of England

waltzed sale later this week that the economy is not growing as much

as it should. It is likely to only grow by one %, half what was

predicted. How much of this is down to the crisis in the Eurozone?

think it it has certainly affected confidence, the relentless and bad

headlines. The fact that the West has high welfare costs and an

ageing population. We face a lot of competitors in low-cost countries

such as India and China and we're going through a period of

adjustment. Countries such as Great Britain, the Eurozone countries and

America have a lot of tough decisions to make if they want to

retain their economic standing. People are spotting gaps in the

market and what we are seeing is people taking a hobby or a talent

in to a business. Start-up businesses are great because they

are generating turnover and proffer built profitability. But it is very

important that they are invested in. The growth in the UK economy it is

no such a very important thing that investment is made in new business.

Sadly, unemployment figures will come out saying that one million

youngster's are unemployed. But on the good side, about 80 % of them

want to start their own business. The entrepreneur who ale or latent

talent is there. What we need to do as a country is cultivate that more.

Do they not see Enterprise has the worst possible option? No, not at

all, the see it as a strong option. It is not seen as the traditional

option, so when you go to the Careers Service, you're naturally

encouraged to call him to a job. But if you're really good at making

music or as a fashion designer, did you know that you could actually go

yourself. It is important that that messages picked out to market.

is the best advice you can give about to someone wanting to set up

their own business? Do not just going to it to make a lot of money.

Going to it because you love it and believe in it. The best lesson you

have learnt from your own mistakes? He best lesson was a mistake I did

not make was giving away it equity at the start of the business.

Of Business but do not make a profit. It is maybe too summer sign

that your business is not doing well. But for others, making money

is simply not the great point of their business. We are operating

from a 34 acre woodland. The profit that the social enterprise business

makes a all ploughed back into the business. There is the distinct

difference between full profit organisations and businesses such

as ours. The business model is important. The guarantee is that it

is not a work for profit business. The chief executive cannot earn

more than four times the value of the lowest-paid worker. It means we

provide education programmes. Our environmental impact means that we

manage ancient woodlands in Lincolnshire. Behind me are a group

of young people. They are being tutored by our ranger, who is

showing them how to prune trees. It is very important to learn Whitlam

skills and will add to their CV21 to try and get back to work. When

it comes to spring, the branch will regrow. I had a real road to

Damascus and that is how I get involved. I work for a drug company

and make the social entrepreneur 20 years ago. He showed that making

money is good when society benefits. Here we are in part of the wood

where we need at three taken down. The Forester is showing the learner

how to take down the chief safely and how to cut it down and sell it

as firewood. You get some trees that are too rotten. We have just

been maintaining the forest, really. Social enterprise faces many

challenges. Here, we face at various challenges, such as getting

planning permission and been accepted by other landowners,

because we're in a place which has public access. But it is just as

difficult getting other people to accept that we are a business. Just

because we make a profit, it goes back into the local community and

that is difficult for some people to grasp. This woodland writ relies

on a profit to help it survive. A lot of social enterprises are set

up with a lot of good will. But you simply need the backing for what

you do. We have managed to turn this derelict would London to what

you CTD into the profitable, manageable business. Now Exwick,