Behind every successful start-up is a blend of careful preparaton, passionate leadership, and calculated risk. In Episode 5 of Warwick Business School’s Lead Out Loud podcast, Professor Simon Barnes, expert in start-up finance and venture capital, joins Nick Grey, founder and CEO of Gtech, to explore what it really takes to launch and scale a business.
Together, they unpack the myths and realities of entrepreneurship—from raising capital to surviving the infamous “valley of death.”
For Nick, the journey began not in boardrooms but on a cold construction site in winter. A job at VAX (now a Gtech competitor) unlocked his love for product design, and eventually sparked the decision to build his own company.
“I loved the design environment… I was full of new ideas,” he recalls. “One of the first proper products I got to design became Britain’s best-selling vacuum cleaner.”
That success planted the seed: “Maybe I should be designing products for me, not someone else.”
Professor Barnes highlights the different triggers that lead people to entrepreneurship. “Some start with a great idea and spot an opportunity; others react to a negative change in their circumstances. What’s surprising is that both paths are equally likely to lead to success.”
While entrepreneurship is often associated with bold risks, both guests emphasise the importance of strategic preparation.
“People say entrepreneurs take risks – and we might do – but we like to load the odds in our favour before we start,” Nick explains. “I didn’t do it on a wing and a prayer… I knew how to design products, how to manufacture them, and I’d already had successful projects.”
Simon agrees: “I try to encourage students to think big but start small. If they come up with plans to launch multiple products in multiple markets based on nothing – it’s never going to work.”
He warns against overreliance on funding alone. “There’s a temptation to raise huge amounts of money and conquer the world, but then you’re a rocket ship getting halfway to space and running out of fuel.”
A recurring theme is the precarious early stage where costs mount before revenue arrives—what Simon calls the "valley of death". It’s here that many ventures fail, not due to lack of passion, but lack of resources.
Nick took a different path. “I’m the opposite of a capital raiser… I saved up £18,000 which could pay my salary and make prototypes. In the end, I did a deal with a US customer who agreed to pay the tooling cost in exchange for an exclusive licence.”
His advice? “Borrow as little as you can—and nothing until you have to. Treat every penny like it’s your last.”
Leadership, for Nick, also means being close to the customer and staying grounded in real-world feedback.
“You’ve got to be your own worst critic,” he says. “Read your customer reviews. I talk to our customer service team directly—they’ll say, ‘Nick, this is fine, but can you sort this out for us?’ That’s the real insight.”
Simon even has experience with contacting Gtech customer service. He recalls “I managed to break my hedge trimmers. I phoned customer service and they picked up right away—very different to most experiences today.”
Despite his business success, Nick remains modest about his leadership style.
“Being a good designer doesn’t make you a good leader… I never dreamt of being a leader. The quiet ones often make the best leaders—they just get on with it and lead the business into genuine progression.”
Simon underscores the centrality of the team: “The team is everything. Most venture capitalists would rather back an A-grade team with a B-grade idea than the other way around.”
Openness to feedback is key, he adds. “If a team is defensive, that’s a red flag. But if they say, ‘We don’t know, but we’ll find out,’ that’s gold.”
Start with passion: prepare with precision: True entrepreneurs don’t leap blindly—they stack the odds in their favour before taking the plunge.
Raise money wisely: Understand the "valley of death", and don’t overfund unless absolutely necessary.
Build an A-team: A great idea means little without the right people behind it.
Listen to feedback: Both customer insight and internal criticism are crucial for growth.
Think big, start small: Ambition matters—but scale only works when it’s rooted in practicality.
Whether you're bootstrapping or seeking venture capital, success lies in knowing when to take risks—and how to minimise them. For both Simon and Nick, it's not just about money or markets, but building meaningful products, strong teams, and businesses that last.
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