Rohan Blacker: Learning the lessons from Sofa.com

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0:47Sofas themselves were sold in the UK in a sort of very fragmented, I suppose very traditional way. There were lots of local, regional sofa shops. The Nuts name, I the best had. We just wanted the best name you could possibly get for a sofa company. Sofa.com was possibly available. So we just assumed that anyone taps in Sofa, Sofa.com comes up first because it's Sofa.flipping.com. You know, you develop a sort of an illness in a way. You can't watch a film without looking at the sofas. Watching the demise of Sofa.com as it just slowly car crashed into the wall should be a sort of case study at business school.

1:37I'm Dougal Shaw and this is the Business Leader Podcast. We look at the stories and strategies behind modern businesses. Today, my guest, who you just heard there, is Rohan Blacker. He's a serial entrepreneur here in the UK, who is probably best known for co-founding Sofa.com, which began life in 2006. It achieved a high profile as one of the first wave of online e-commerce retail businesses. It had warehouse stores you could visit, but it was also one of the first businesses to prioritise selling online, as the name suggests. Blacker left that business about a decade ago now, when a private equity firm took over.

2:15But he's still very much in the furniture retail game, with ventures like Pookie.com, in lighting, and also Splendid, which specialises in sustainable sofas. I went to meet him on his houseboat in West London.

2:32You really jumped tracks in your career because you started out and you were all set to be a barrister. You were a lawyer. You'd done presumably years and years of work qualifying, and then you'd jump into entrepreneurship the other way. What happened back then? Well, I became a barrister because I didn't, look, I went to university. I didn't know what to study. My father said a law degree would be a really great thing to do. I was lucky enough to get accepted to Bristol to do a law degree, which at the time was a pretty, pretty hot law degree. And then having done a law degree, I felt I should carry, I should, I should continue with it.

3:05So I then, I then went to Bar, to Bar School, to the Innsicott School of Law. I got accepted there. I passed those exams. And then there's this anachronism where you've got to eat 24 dinners with other barristers in the inn of court, to which you remember, I was a member of Inn of Temple. And I just couldn't be asked to eat all those 24 dinners. And I ate about five or six of them. And then at the time, Lord Mackay, who was the Lord Chancellor, said that actually he was going to create equal rights of access to the High Court and advocacy to solicitors and barristers. So I thought, well, that's fine.

3:38I'll just go be a solicitor. So I can use all my advocacy and baristorial stuff as a solicitor. And it might actually be more interesting. So I did that. And I found a practice in London. It was a matrimonial practice. I started there. I was all excited about it. And then I realized quite quickly that I wasn't going to be a great lawyer. And my main issue was I'm a very slow reader. And you got these briefs and that you know you would get you know 300 pages to read overnight i just look at this thing and i say i'm not going to get through 30 of these pages let alone remember it um and i then try to do quick reading courses and then in those days there were there were lots of adverts in the newspapers and they would give you these these sort of it was effectively like a camera you click it once and it would show you a word for a second you click it a second time to show you two words for one second.

4:33And the idea is you would end up with a whole sentence for a quarter of a second or a whole paragraph for a quarter of a second, and you were just supposed to scan and read. And it never worked. I still read really slowly. I still move my lips. And I decided after a while to quit the law. But basically what you maybe found was that you're a man of action and therefore entrepreneurship is quite a big pull. Yeah, but I didn't really, I didn't have any desperate ambition to be an entrepreneur. I didn't have lots of ideas. I didn't have things that I desperately wanted to do. But perhaps through quitting the law, I was gradually understanding that working for myself might be at my own speed, whether that's fast or slow, might be better.

5:20So I guess at this point, you're in your mid to late 20s. And one thing I do know is that you had an uncle who had a restaurant, and I believe you worked in that restaurant. Restaurants are obviously very kind of visceral businesses. You see exactly what's going on. Was that something that inspired you? Of course. I only worked there for a short while, but I did work for him in other businesses of his, and he was definitely an entrepreneur. But then my first business that I got involved with was a restaurant itself. It was, well, four of us took over an old boozer in southwest London. In the days when you could pick up old boozers for actually nought p, In fact, they might give you some quid as well to take it on.

5:58And so the whole affair was incredibly cheap to do. And we were able to set up what these days might be called a gastropub. In those days, the word gastropub hadn't been coined, but it involved really good food and a really fun bar and combining the two in what used to be a pub. And that's where I learned almost more than I've ever learned anything in business. Well, I learned a lot about what not to do. Like what? Go in with a whole load of slightly dodgy business partners. I didn't know the guys. I was, I heard that they were doing this and I was really, really keen to get involved. And I met one of them via a sort of strange route.

6:40But I trusted them and I went in as green as you possibly could. And we were very lucky because the pub, the restaurant, whatever you like to call it, It was crazy busy from day one. It's exactly what the area needed. We were constantly packed. We should have made a lot of money, but we didn't because it was one of the worst run businesses I've ever come across. And for some reason, all four business partners, only really two and a half of whom worked in the business, thought that they could make a living out of this small pub. I mean, it was completely unrealistic. So after about 18 months, two years, there was a right old squabble and I left and I ran the restaurant a bit.

7:20But I learned a very great deal about people, about the need to have accounts, the need to look at the small stuff, the need to be prudent, the need to be not so crazily impulsive. But I also learned that if you put something on, something which is good, which people want, they will come. And I think that's what we did do. We had a great bar. We had a great restaurant. And people loved it. And then, you know, long before delivery was a thing, I'm guessing it was after that, you set up deliverance where you're cooking food and delivering it. So you've kind of seen something early, but maybe too early.

7:58Well, I'll tell you, that came out of the fact that, so the restaurant part of this pub called The Pen was, we had 43 covers or something. And we were full every night. And it was always a sense of great frustration that we couldn't fit more people. Now, we could have done an early sitting and a late sitting, but we didn't like that vibe because our view was that people could have the table for as long as they want. So we didn't do double sittings. So how then? And we turned almost the same number of people away every night. And so that's what sort of set me onto this idea of food delivery, because so long as the demand was there and you had a kitchen big enough to fulfill the orders, you had a kitchen with effectively limitless ability to feed as many people in London as you possibly could.

8:46And that's what we did. But we made our lives very difficult because we decided to offer deliverance was... And the key difference between deliverance and Deliveroo is we actually cooked our own food. They collect other people. So, you know, Deliveroo is an app really, and deliverance was very much a hospitality catering business. But we decided to cook great food and a whole variety of different foods. We had a Thai kitchen with Thai chefs in it. We had a Chinese kitchen with two great Chinese chefs, an Indian kitchen with Indian chefs. We had a pizza kitchen with not an Italian chef, as it turns out, a Bosnian chef.

9:22And then we had a whole load of guys, including me, very often on motorbikes and mopeds, and a call center, because this was all pre-mobile phone, I suppose. Well, it was actually it was pre-mobile, well, sort of simultaneous mobile phone, but certainly pre-useful web. So we had a call center and we bit off a lot more than we realistically could have chewed. And I suppose, and I always used to say afterwards, if I had any idea how bloody difficult this business is going to be, I wouldn't have done it the first way because it was very complicated. but again it taught us so so much um and about business and about what to do and what not to do it was very very hard work and we were working seven days a week all hours but it was it was some of the best fun and times of my life actually so each business even when it doesn't work out you're learning something new it's kind of it's what it's like the career of the entrepreneur each stage you're learning something that you apply to the next yeah of course of course i mean that business did work out as it happens.

10:23And we sold it successfully, but it was a tough business. And the next owners found it tough as well. And then when Deliveroo showed up, they could trace their demise as Deliveroo's rise, they grew.

10:40And then your next big leap is quite different. It's from the world of food and delivery to sofas, sofa.com in 2006 yeah so i mean again there you're seeing we've already seen with gastropubs you're a bit ahead of the curve yeah with food delivery as well perhaps with sofa.com this is the age where retailers are beginning beginning to understand that people will use e-commerce websites aren't just showcase pages they're a place you go to buy yeah so is that what you've seen and you're trying to act on it with sofa.com absolutely so so when i had a great business partner the late sadly pat oh he's right there that's pat um um that's who i worked with for Just sitting behind us in a picture.

11:23We worked with each other for a long time. And then when we sold Deliverance, we were kicking around looking for the next opportunity. We were very aware that the web was becoming super interesting. The web had had its big boom time over the year 2000. Everyone went crazy. Everyone then lost all their money because there was the crash immediately thereafter. But then the web was actually gaining credibility. And by about 205, 206, the web was obviously an interesting place to do stuff. Sofas themselves were sold in the UK in a sort of very fragmented, a very, I suppose, very traditional way. There were lots of local, regional sofa shops.

12:04A few of the big players, DFS, for example, had a website. But as you say, it was just a showcase. I mean, actually, DFS, you could theoretically buy off their site, but it was such basic early technology. So they would show a sofa, and then there'd be a buy button, and there'd be one of those dropdowns going, do you want one, two, three, four, five, 10, 20, 50, 100 of these sofas? I mean, no one had thought about it. So they did have a website, but basically, no one was actually trying to sell sofas online. They were just a notice board. So we thought that there might be a way to do that. And the only way we were prepared to do it is if we could get a really crazy ass name, a good name.

12:51Or as Pat, who was a great poker player, the nuts name. I the best had. We just wanted the best name you could possibly get for a sofa company. And Pat was tiddling around and he discovered that Sofa.com was possibly available because when you tapped in Sofa.com, you got redirected to a company in Milwaukee, Wisconsin. And so we got in touch with them. And after a fairly long, about six or seven months of negotiation, they first wanted a million dollars for this URL. And a million dollars for URL in 2005 was a really incredible amount of money. I think URLs get sold for many times that these days.

13:32But back then, that would have probably broken all records, I'm imagining. Sofa.com itself was one of the very first URLs ever to be registered back in something like 1993 or something. Anyway, so after about eight months, we bought it. And we did. We paid$200 ,000, which was in those days, in those glory days when it was$2 to a pad, it cost us 100 ,000 quid. So if you couldn't have bought the name, would you still have gone ahead with the business? I think we might not have done, actually, because we became so fixated on buying that name. We suddenly thought that no other name could do it. Because also, very naively, we thought that if you had sofa.com, you went straight to the top of the organic search rankings.

14:13We didn't know anything about SEO. We'd never heard that acronym before, but that acronym probably didn't even exist. So we just assumed that anyone taps in sofa, sofa.com comes up first because it's sofa.flipping.com. But that wasn't the case at all. We discussed that when we bought the built the name back to the UK, we had no organic search authority at all. I mean, that's another story. But so we, yeah, we became so fixated on buying that URL that I suspect we might not have done it actually. I haven't been asked that before, but yeah, I guess so. And I mean, just on that point, because they do same business, you know, follow your passion.

14:47And obviously when you look at the businesses you've done since then, you obviously love furnishings and lights and all the rest of the home decor. Yeah. But was it really with sofas that you just saw a gap in the market? I think I'm sort of one of life's enthusiasts. And I could have fallen in love with any product almost. And I got really truly immersed in the world of sofas. And I grew to love it. I grew to love the sort of mechanics of a sofa. So not just the sort of look and the aesthetics, but also how it's built up and what makes a seat better and how to build up cushions and all that sort of technical stuff, I suppose.

15:34And then the design and then the fabrics and then, but also the whole, I suppose, aspect of how you get a business like this off the ground. Because it was, you know, we were doing this in a very different way. So effectively what we were doing, we had a warehouse and our original idea is that every sofa was going to be loose covered. So you'd have a whole load of carcasses over here and then you have a whole load of covers over there. And then Mrs. Jones or Mr. Jones would call up and go, I want sofa A in pink. And we would put the two together and we'd deliver them and we'd deliver them almost immediately.

16:14And that was very complicated. There were lots of issues. Again, talking of mistakes, we found ourselves a warehouse which was far too small. We shouldn't have done loose covers. We shouldn't have done any number of things we shouldn't have done. It became a passion. And actually, as you say, so ever since then, I've been involved at Homewares. But it became a real interest. And I sort of loved it. You know, you develop a sort of an illness in a way. You can't watch a film without looking at the sofas. You know, you see a scene and people are sitting on sofas and you begin to wonder how that sprung.

16:51You go to someone's house and you find yourself putting your hands down the side of the sofa just to establish how they've constructed it. It becomes problematic, but it just happens. So I think I'm right. Did you control the verticals that you'd actually do? You'd construct a lot of the structure of the furniture yourselves? Yes, yes, we did. So actually at the start, we actually kept the start of sofa.com. Again, of course, we knew nothing about sofas. And we called up a mate of ours in Poland who I'd worked with at Deliverance, strange enough. Very able guy who'd gone back to live in Poland.

17:26And we said, look, Zach, we're thinking of sofas. We'd like to come over in a month's time. Can you arrange, say, 10 meetings at factories? And we went to visit all these factories. We had three or four days. It was incredibly good fun. We started out in the first factory knowing nothing, sitting there rather silent. And by the time we got to factory number three, we had a bit of sort of, we'd learned a bit. We could sort of join in the conversation. But it wasn't until probably year six or seven at Sofa.com that we built our own factory. So we grew pretty damn fast. The factory that we had grew with us.

18:01And we got to a pivotal point where we said to our factory, look, you've either got to invest quite heavily in your factory or we're going to have to move on because we are growing and we can't get to a point where you can't supply us. So they said, look, we don't want to do that, which was sad, but honest, I suppose. And so we went out and we built ourselves a big, shiny, new factory in a new warehouse, which we rented. And it was an amazing, amazing thing to do. It was an amazing experience because, and again, it was a very, we literally got not quite trees, but very large blocks of wood arrived at one end of beech and birch.

18:50So we had a large sort of carpentry workshop with all these CMC machines and all sorts of machines, which did all sorts of things. And you could see just like, you know, perhaps a car plant or I don't know what, but, you the individual, there was making all the small parts of the frame, and then the construction of the frame, and then the springs, and then the cutting of the fabrics, and then the this, and then the cutting of the foam. We had this big 3D foam cutting, 3D coat. So we'd get blocks of foam. They'd be three meters by three meters by three meters. They'd be huge. They would all be computerized and these these sort of laser cutters would be going through it was and then at the end popped a sofa and it was amazing and so we were yeah we were we we absolutely controlled the verticals yeah a big thing in a business like this is 3pl the third party logistics because you've got to obviously deliver these very good things which are non the non-perishable products but they're quite big to move yeah so how did you figure that out we did it ourselves so we had our own warehouse in the UK and we decided day one that we were going to deliver our own sofas.

20:04We felt that was the right thing to do. We felt that because it was almost the only physical touch point we were going to have with a customer. The only time we could say, hi, it's us. And if there was a cock up, we could turn around on the M4 and go back and reaffix the leg or tweak things. And so we felt that was incredibly important thing to do. And we had over the course of the business, four or five opportunities. We moved warehouse, I think, four or five times. And every time we said to ourselves, should we be subcontracted to a 3PL operator? And every time we went, no, this is too important.

20:38We've got to do it ourselves. That said, in the business that we run at the moment, Splendid, which is a new sofa company, we don't do that. So was that a mistake you learned from? No, it wasn't a mistake. It was bloody hard work, to be honest. And we've got an amazingly good delivery partner in the UK now who I've known for years and they really understand what we're trying to do and the levels of service we want to do. And as I say, if there's a screw up, they'll go back and sort it. If the sofa's got to go to the 10th floor, they'll get it there. And they work completely alongside us and share our values, which I think is important.

21:20And I have to say, it is quite nice not to be delivering service because it's really tough. You left the business in 2015, I think. That's when you private equity came in and you sold your shares. Then eventually when it got sold to Fraser's Group, I think it was a nominal sum, things had declined a bit. Obviously, you're an outsider from that point, but have you got any thoughts on why that didn't work out? Yeah, I do. When Sofa.com basically hit the rock, so I'll tell you the numbers. We sold Sofa.com with revenue of about 25 million pounds and profits of about 4 million pounds. And it was a really healthy, strong business.

22:00I don't mind telling you these numbers now because they're way back in the past. and three years later it had revenue of 27 or 28 million pounds and had losses of three million pounds and I I was going up to talk to the bank because I remained a shareholder of the business and I was going to talk to the bank and I was thinking where did this all go wrong and I'd been a director of the business the whole way through but I'd I'd been I'd been a sort of quiet director for most of the time because I didn't want to I didn't want to get in the way of their plan and I didn't want to be one of those annoying founders who just starts screaming at board meetings.

22:38But on the train, I wrote down a whole load of things, and actually this list just went on and on and on and on. And I concluded in the end, it was really very much sort of death by a thousand cuts. Some of the cuts are much deeper than others, but there were so many small incremental decisions they made. And they didn't realize at the time that just whittled away the brand or that whittled away the margin or that whittled away this or that whittled away that. And just bit by bit, the business just started going wrong. And then about a year before, there was a rights issue. They needed another million quid or something.

23:19And they came to me and they said, right, can you, will you cough? And I said, I'm not going to do it because I don't I don't believe in the plan. And then about seven months later, they were bust and the bank called in on them. And that's when Mike Ashley and his Fraser Group came and bought it, as is there, won't. But again, that was a really interesting exercise. And then I did like, there's a whole group of entrepreneurs who get a real kick out of buying their business back. It's a big sort of machismo, sort of alpha male silverback thing that people want to do, because there's nothing more exciting than going, I bought my business back and I turned it around and then I sold it again.

24:01I bought it back and I sold it again. I bought it. You know, there's quite a number of these people. Only I could say that it took me to come back. But equally, there's a lot of people who bought that business back and totally screwed it up and went bust and walked away with their tail between their legs. So I did contemplate buying it back, but I absolutely didn't. And I don't think it was, it was never really going to happen. but it was again I often think that the demise of a business and it's not unique of course but watching the demise of SoFi.com which is a healthy, brilliant wonderful business as it just slowly car crashed into the wall should be a sort of case study at business school it was really interesting, very simple very comprehensible business nothing crazy about it and it suffered from all the usual problems And it was just, as a case study, it was genuinely interesting.

24:56Sad, but it's still going. And if you have better vigilance, can you stop these thousand cuts happening? Is that what it takes to stop that happening if other people are trying to learn from this? Yes. Yes, I would have thought so. I would have thought so. And I often wonder, if I had never sold it, would I have run it any better? Perhaps I'd have run it into the ground too. I don't think so because there were certain sort of cornerstones of the business that we really, really strongly believed in. Like, for example, we didn't discount. We didn't do sales. And they got hooked. They absolutely got hooked on discounting.

25:35Just like, you know. And I'm not saying that's necessarily bad. It works for some people. But that just whittled away their margin. And so when they weren't discounting, they didn't make any sales. And when they were discounting, they sold lots of sofas, but at a very reduced margin, for example. They also radically cut their marketing budget. But they radically cut the marketing budget. These days, you can market really cheaply because there's this wonderful thing called social media, which cost you, was largely free. Back then, you couldn't rely on social media. So you actually had to, you know, and remember, we were a sort of dot com.

26:10I know we had a showroom, but we were a dot com. and they got worried about their marketing spend. So they cut their marketing budget. So suddenly no one came to their website. So they were selling low margin sofas and less of them. The one thing they did do, they opened loads of stalls all around the UK. So they probably opened six, seven, perhaps eight extra quite large showrooms around the UK, which gave them a very heavy rent roll, a whole load more staff to manage geographically around the country. So yes, and they got a lot of sales out of those, but they were burdened with this massive overhead.

26:53So actually when Mike Ashley and his married gang came in, they shut down virtual stores.

27:02Let's move on to Pookie. I imagine when you bought the name for Pookie, there was less demand for that online. I paid$1 ,900. But I did, it wasn't free. You know, it wasn't just sitting there. So I did, and I didn't know, I honestly didn't know if I was buying the right thing. Pat and myself used to buy URLs a bit. We bought, there was a business which went wrong for us. It's called oo.com, O-O-H.com. And we bought that URL. I think we bought that URL for 20 ,000 quid. I mean, it's quite, and it was sort of experiential. it was going to it was it was good i'll tell you what if you start who.com today it would it would thrive but and i and i hate entrepreneurs who go oh yeah i was too early to the party yeah no i was i you know i you know you know that's a sort of horrible arrogance but i but we were early um and it was it was quite a heavy diversion but but we we had a thing we like buying sort of premium short URLs.

28:05And Pookie was that. And I looked at it. I didn't know whether it was right to call a business Pookie. So I sat on it for a while and I thought about it. And even when we set up Pookie, I wasn't convinced it was right. I went to Perry, our graphic designer who I worked with for years, who runs Big Fish Agency. And Perry goes, fulfills four out of five of my naming conventions. Number one, it's poetic. Two, it's visually exciting. Three, it sounds great. The only thing it doesn't do, number five, is it doesn't say what it does on the tin. And I don't think that's a problem. I think you should use it.

28:38Is Pookie that poetic? Maybe it is. I do not. It means rude things in some countries. So basically, you had the kind of potential.com domain names before you, and it was a case of then choosing which, you know, the business could pick the name because you owned them. Well, I wanted to do a lighting business. I had and I did want to do licensing business. So those two sort of came together. And in a way, I bought, you know, yes, I had had it for a while. And I sort of fitted the two together. But it could have been ooh, lights, though, didn't it? It could have been ooh, yeah. Ooh, yeah, it could have been.

29:11It could have probably been better. Probably wouldn't. But actually, again, what was slightly annoying is when we sold Sofa.com, along with it went ooh.com. And I tried to get it back off them. So you never meant to buy this. It just happens to be sitting in. And they never gave it. They said, oh, yeah, we'll do it. I never got it back. Never got it. Actually, I miss that URL because it was such a great URL. And people wanted it because, ooh, the OOH also stood for out of home. And so people wanted to buy it off us. Again, I think that would be a super valuable URL these days. So how did it go with the lighting business?

29:51Were you able to learn a lot of the lessons from all the previous businesses, including sofa.com your time there yes yeah i learned um a lot but but again this was going to be a different business because even though it's homewares um we were buying a lot from further afield from india from vietnam at the start we didn't buy use china i don't think but basically the east and the far east and so we needed stock so we had to fill so we had to And of course, a lot of these factories we work with, they would operate. I'd never heard of this acronym, the MOQ before, the minimum order quantity. So we would have to buy 100 of these lights or more.

30:32And we had to put them in a warehouse. So the stock and turnover of stock was very different. With sofas, so all the sofas were effectively made to order. So our warehouse days was about a week. So a sofa would come into the warehouse, it'd be gone within a week. with this business it was very different because our stock might sit there for frankly years and especially if you you picked a light that or designed a light that people didn't really like you just might sit there for decades so yeah it was it was it was it was different obviously i learned i took a lot of sofa.com with me um and looking at the the sort of marketplace and um trying to you know we were resolutely trying to hit what you might called the mid-market or the upper mainstream, we were trying to sell really lovely lights at a price which was more affordable.

31:26Because, again, in those days, you had a whole group of lighting retailers who sat at the very top and they sold lights for eye-watering sums of money. I'm not saying the lights were not nice. They were really nice. but they just sold them for, I mean, the sort of money that people just, 98%, probably perhaps 99.9 % of the population just can't consider. It's just absolutely out of the question. And then there was a whole load of people saying, you know, IKEA is selling lights at the bottom. There wasn't that much in the middle, to be honest. So I just wanted to make great lights and sell them for a price which was a lot more affordable or realistic.

32:07So again, there you spotted a gap in the market. But another thing you've done is you've gone back to the world of sofas with Splendid now. So you must have learned specific lessons from Sofa.com that you can utilize with this one. Yes, I did. Okay. So Sofa.com, when we set up Sofa.com, again, you had a group of companies selling very high value sofas. The shops were intimidating. the lead times are very long they were like so high fashion stores and you would press on the bell and they would look you up and down and work out whether they wanted you in their store or not and and their sofas cost a vast vast amounts of money and they were just for the very very few then you had the low low level and and with very little in the mid-level that as they say you were regional sofa stores around around the UK but there was very very little what you might call dedicated mid-market.

33:01What's happened subsequent to that is that the mid-market has become heavily populated. And there's loads of companies which sell, they basically all sell the same sofa with slightly different hats on. They've all got different brands. They might have slightly different fabrics. They might have slightly different shades, but they're basically all the same. And I know how they're made. I know how much they cost. And I just thought to myself, There's an opportunity here to create something, to create a sofa which is A, made of natural stuff, i.e. sustainable. It's made out of the goods. It's not absolutely rammed full of plastic, frankly, foams and fibres.

33:41So it's an eco-sofa. You know, it's a pretty sofa made of the right stuff. and that was based incidentally on the fact that well over a million sofas get discarded in this country every year every year we don't quite know how many it is um and virtually all those sofas are full of foam and fiber and that foam and fiber is not going to degrade for decades if not centuries and and we talk about fast fashion in this business in this country we get upset by fast fashion and we talk about and we talk about plastic bottles and we talk about all sorts of things and we get very animated about lots of...

34:21No one, as far as I hear, ever talks about fast furniture or the fact that we're throwing away these huge things. To the point, at my local rubbish tip, they've got a dedicated bin. And when I say a bin, it's as big as this boat. It's dedicated for throwaway sofas. And where are they going to go? They can only go one place. They're going to landfill. So I wanted to make sofas which weren't going to... Number one, make them last forever. So the most sustainable thing you can do is make something that's not going to get thrown away. Two, I wanted to spend, it's a slightly different shape of business.

34:58I wanted to spend as much money on the sofa as I could, more than anyone else at our price point, but I wanted to sell it at that price point. And the only way I could do that is by not having fancy showrooms, by not having expensive marketing. I was talking about the marketing earlier on. And we like to do as much free marketing as we possibly can because I want our marketing costs. Every overhead has got to be pitched at the lowest point because the only thing I really want to spend money on is the sofa. Because I'm conscious that when people spend two and a half, three thousand quid, and that is a lot of money.

35:34I'm not saying we're the cheapest sofa company out there. We're not. You can buy lots of cheaper sofas. But ours are the best sofas. And I knew that if I really worked at this and I worked with my mate, Zach, in Poland, and they are made in Poland, and I'm not ashamed of that because the poles are totally brilliant and they've got a very strong and long culture of making furniture and sofas. And if we worked really hard and we bought sensibly and we trained people in the right way, we could make sofas which were just brilliant, at least half the price of any sort of equivalent competition. I sometimes use the sort of suggestion, the comparison of Aldi for sofas.

36:12In a way, that sort of... or EasyJet for sofas. But it's EasyJet. The point is, it's mid-market. It's without all the frills. I just eschew. I get rid of all the fripperies, all the nonsense, all the... Because people are spending so much money on this thing, they honestly will thank me in three years' time for investing in their sofa, because they don't give a damn about my marketing. They don't give a damn about the fact that, you know, there was a really nice, you know, bloke selling them a sofa. They don't give a damn about any of this stuff. What they're going to live with for the next 20, 30, 40 billion years is the sofa.

36:47And I've got to make that as nice as possible. And just a closing thought, a closing question. You're someone who made the personal choice to become an entrepreneur, to take the entrepreneur's path. Do you feel that Britain is a good country for entrepreneurship? And maybe has that changed over time? while you've been a business person? It's certainly changed. There are a lot more people wanting to be entrepreneurs and there are more businesses being set up every day. Is it a good tax environment for entrepreneurship? I think there are lots of things wrong with it. There are things like I get deeply frustrated by the VAT threshold.

37:31I think it's still something like 70 ,000 or 80 ,000. It's sat at that level for about the last 25 years. It hasn't taken any account of inflation. That threshold, I mean, I'm not a reformer, really, and I'm not. But there's one policy that they have is that they would take that VAT threshold, they'll wrap it up to 300 ,000 pounds. I think that would be radically brilliant. And I think the government is completely wrong there. And I think the government do a lot of things which aren't conducive. Whether it's Labour or Conservative or whoever they may be, they all maintain that they're pro-business.

38:04And they probably are, but they don't work that way necessarily. They do a lot of things which, on the face of it, are anti-business. But there are some brilliant people in this country. There's lots of people hatching ideas all the time, business being set up all the time. In the 70s, there were hardly any entrepreneurs. In the 80s, a few more, blah, blah, blah. These days, as a lot of them about. And it's really exciting. And there's still lots of opportunity. It's very easy to look at today and go, oh, everything's been decided. Everything's been challenged. Every toothbrush, every toothpaste, everything's been changed by some wisecrack entrepreneur.

38:51But no, there's always, always ways you can do things better. All you've got to do, I say all, you've either got to invent something brand new or you've got to take something look at it very carefully and think how can I do that better or how can I make that cheaper or how can I put a bigger smile on the customer's face and so long as those opportunities entrepreneurs will still come irrespective of what the government puts in your way A nice bit of inspiration there for you entrepreneurs listening and you've been listening to me Dougal Shaw speaking to Rohan Blacker of Sofa.com and now Splendid for the Business Leader Podcast Please do rate and subscribe to us wherever you get your podcasts.

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