From building a Unicorn to Leading a Nation during Covid - Nadhim Zahawi

0:00Nadeem Zahawi, welcome to Secret Leaders. Thank you for having me. Most welcome. So most people watching will know you as a Conservative MP, Chancellor of the Exchequer, the man behind the vaccine rollout. But, you know, for us and we're a business show, we're also so interested in the fact that you built a company, YouGov, that has, as I Googled earlier, an annual revenue of 250 million. So, you know, what's new with you? What are you doing now? Yeah, where do you go from that? Yeah, I was very lucky in many ways. So I was a unique type of politician in the sense that I initially entered politics in the 90s in local government, in Wandsworth, then stopped doing politics, founded YouGov, took it public in 2005, stayed on for a further five years, so 10 years in total as chief exec, running it in the public markets, taking it to the United States of America, which was our big break.

0:57what made you go of a unicorn was going to America and growing in America. I'm loving life. I'm now chairman of Very Group, which is actually the old great universal Gus catalog business and Littlewood's catalog business combined. We've got about 4 million customers. We sell them about 1.7 billion pounds worth of goods. So we sell everything other than books and groceries, but everything from sports apparel to toys to electronics and white goods. It's a great business, genuinely a great business. It's got amazing heritage, over 100 years of heritage, pure online now, but with an amazing financial service element.

1:44So the pure online players in the fashion world will probably make net-net about 5%, 5.4 % margin. Our margins are close to 13%, 13.5 % margin because our customer actually has an account with us. They're able to borrow that little bit extra to buy the things that they want to buy and then pay over time. And it's an incredibly successful business. And I'm very lucky to be chairman of it. And that was all before you joined. So really, the pressure's on. Yeah, exactly right. That's very true. Very, very true. I mean, I love businesses where I think I can make a big contribution. I think I can. In this case, we've got an amazing team, CEO, CFO, finance director, and actually a great COO.

2:33I said to him, you know, many, many decades ago, it's in the book, there's a whole chapter about, I think it's called Pete and Johnny, where I worked with Peter Dubins and Jonathan Seif, selling initially sort of hard rock cafe t-shirts, then changing colour t-shirts, supplying everybody on the high street from M &S to Tesco's, Littlewood's catalogue at the time. In fact, when I became chairman, they found an old docket with my signature on it, where basically they bought some licensed children's wear from us. A little full circle moment. It is. I mean, but what was fascinating about the business is I initially sort of went to have a look at the fulfillment center.

3:16We've got this incredible place called Skygate in the East Midlands. And it wasn't the robots, which was high tech, latest robotics. I spent about a quarter of a billion pounds building this incredible fulfillment center. I asked our really super talented COO, what's your secret here? because you've clearly done something unique compared to the rest of the market because your fulfillment is as competitive as Amazon's. He said, look, Nadia, I designed the whole thing. He said, I went around the whole world. We went to South Korea. We had a look at Japan, the US. We designed the whole fulfillment center for our 4.4 million customers based on a simple principle, and that is my biggest supplier into the fulfillment center is the returns department because online people will order three shirts and will send two back.

4:08If I can't reprocess them, everybody does, right? If you think about it, if I can't reprocess them in a few hours and get them out for the next customer in a day, then my inventory control, my stock control is blown apart. And that is terrible for any retailer, as you know. And so it's an exciting business, genuinely exciting business. and I'm really delighted to chair it and chair such a strong team of leaders. In the book, which was great, by the way, super engaging. I mean, it's a very colourful life, right? I've done lots of things, so it was always going to be good. You talk a lot about risk-taking.

4:43Yeah. It's an essential ingredient for entrepreneurship, obviously. And government. And government. Okay. Interesting. Yeah. Yeah, so where would you relate, you know, your understanding and appetite for risk in business and risk in government? Yeah, absolutely. So one of the things I try and address in the book, a couple of things. One is to try and demystify politics because I'd like, I hope, some of your listeners after a great business career to think about going to public service. I would, you know, and we can talk about sort of the ups and downs of my career, including my painful exit, ultimately after becoming chairman of the Conservative Party and leaving cabinet over my issues with HMRC.

5:26But with all of that said, it's the best career decision I've ever made to go into public service after YouGov. We all strive to be a footnote in history. And I think being able to say, look, I delivered the vaccine program for the United Kingdom, where we got to just shy of a million doses a day from a standing start, no infrastructure, to build that whole thing was, I think, a remarkable achievement for the team that we put together and an amazing team to lead. um but to your very good question so in business you hold risk daily you make decisions every day you're bombarded with information and you've got to very quickly decide what information is material to the decisions you have to make today and this week uh what you can sort of park for a week and then return to it and look at it next week and what is just noise that you need to just block out because if you don't block it out you're going to lose focus that must be a very good skill in politics it's a great skill in in politics and i think part of that is because you know i'm i trained as an engineer i'm a chemical engineer from university college london but actually there's another skill which is really important which is holding risk right in business you sort of think about you know what are the trade-offs almost every day in your business and actually what are you comfortable holding risk whether it's supplying a client and giving them credit it, right, or, you know, taking a risk on a big order where you haven't sold it yet, right?

6:55And that is a skill that I think sometimes can be lacking in government, lacking in politicians, because the background of most politicians is not business or engineering. It tends to be either special advisors, a number of very talented lawyers, lots of different backgrounds, but few entrepreneurs in many ways and let me try and bring it to life for you from an example so at the early days of the pandemic the NHS thought that actually the biggest challenge to the system to the NHS so that it doesn't break was we needed more intubation so we need to effectively build ventilators because we saw what was happening in Italy as the pandemic took hold people didn't have ventilation and were dying because they couldn't get them intubated as the medical term is.

7:52And so the prime minister put out a challenge to British industry. We had everyone on the call. We had about 65 industrials on the call. James Dyson, Ford, Airbus, everybody was on the call. And Boris Johnson said, your country needs you. We've got to produce these ventilators, not in six months. We don't have six months. We've got 12 weeks at best. Otherwise, the NHS will break in the way the Italian health system had broken. And to his credit, people like James Dice said, look, I'll try and design one quickly and build it. And you don't want that to be the story where it's like, I only took 5 ,325 goes.

8:29Right. So then I'm the junior minister on the call who does the sweeper role, right? So almost like my COO now, right? After the call, I have to be the one then trying to operationalize some of this stuff and decide who do we back? how do we back it what support do they need from government right from the machine um i walk into the department for business and we have a brilliant man called dick elsey we've knighted him he's now sir dick elsey um who's an engineer who headed up the high value manufacturing catapults for us around the country this is pre-covid uh who was waiting for me and i could see he was concerned walks into my office he's minister we're never going to build these ventilators if we try and build them from scratch you know i love what james dice is trying to do and it's great and i said explain to me why he said well because if you build them from scratch you're gonna have to go through the regulatory approval rightly so because what you don't want is to build the machine that then chokes someone or kills someone right this is life or death here um and i said dick you sound like you've got a solution for me right you haven't just come with a problem he said yes i do nadine I think we can do this.

9:40There are two designs, one by Smith Industries, one by a small company in Oxfordshire, that if we talk to the companies and allow us to use their designs, we could bring them together with Ford and with Airbus. So couple their designs with big manufacturing capacity and we can ramp up. And that way we don't need to go through the regulatory approval, which would take months to get through anyway. Now, I could have easily said, look, that's too much risk for me. I need to go to tender because actually, you know, we want to tend this. Actually, having an expert like Dick Elsie made me comfortable enough to say to my team, go.

10:22I made the decision right there and there. I said, right, go. What do you need from me for your approval? Where do I need to sign as the minister in charge? Because I know I can defend it at the dispatch box in parliament if anyone says why did you do that i say here's why i did it right i had no time i had 12 weeks to save lives and actually we've got two approved designs we've got one of the best engineers recommending this and we've got airbus and ford ready to put their whole production muscle behind this for the nation how much of those decisions by the way um are based on an intuition of understanding uh this is the timeline and practicality therefore it has to be done in a certain way and also understanding how you're able to post-rationalize it and defend it if it doesn't go well so that's exactly right so it's part of i think every businessman or woman entrepreneurs um strength dna is to calculate risk right and the ones that do it well become incredibly successful byproducts financial success but actually build some great businesses right and I think the combination of me being an engineer probably having a failure and then a success with UGA failure with Alan Hinckley Limited which we can talk about every entrepreneur, anyone who tells you that they've had success throughout their whole life is either naive or lying or maybe not that successful right because actually the failures are a great pathway for what you can learn to be more successful absolutely right and I think the point I'm trying to make is that I was comfortable holding risk because I had an expert.

11:57In the way we did with Kate Bingham, who we brought in, her day job was investing in different teams in life sciences, in new medicines. And we brought her in to say, right, there is over 100 teams telling us they're going to make a vaccine. Who are we going to basically bet on and how are we going to option those bets and contract with them early so that we'd have the most successful vaccination program in Europe, if not in the world. And we did that well. Where did we do it badly? On PPE. When you go back to the pandemic, and I think the inquiry will ultimately say this, is when we initially were hit by the pandemic and the system needed more masks and gowns and everything else in hospitals, in care homes, we didn't think of bringing in a Justin King.

12:50Now, hindsight is a wonderful thing. But if that had been my remit, I was in a different department then. I was only brought in once we needed the vaccine to be deployed. I would have asked Justin King to come in and say, right, the next six months of your life are mine, in the way we did with Kate Bingham. And she did it for free, by the way. She didn't charge anything for it. You are very comfortable bringing thousands of products into your supermarkets on time, on budget, every single minute, hour, day, you're going to do the same for me by sourcing PPE from around the world. That human being is an expert.

13:31Justin would have had a system for it. Instead, I don't think there was corruption. I think it was naivety that politicians thought. They told every ambassador around the world, get hold of your contact list, start finding out. What were the major mistakes of PPE? so i think that's the the the biggest the biggest mistake is the is the perception publicly um that somehow people are being corrupt right by the way they're deciding who should get a contract for ppe one people forget that the whole world was at the time competing for this product right we were hearing stories of you know agency secret agencies around the world boarding airplanes in Asia with, you know, duffel bags of cash and commandeering the flights to go to their country versus the ultimate, you know, owner or the, the, the, um, uh, where it needed to go.

14:28Um, so the mistake is, I think, not bringing in an expert so that you're comfortable holding risk. It's interesting, isn't it? Cause you always take a very different approach on experts to Michael Gove. So you've got that interesting dichotomy on the value of expertise. I think you're being slightly unfair to Mike. I don't think he's misquoted and much maligned on this. I think he would agree with me that actually it makes a huge difference. The difficulty for him at the time for Matt Hancock is everything was moving so fast. And hindsight is a wonderful thing but i would say if you're asking me what the mistake was i think some of the early mistakes is people you know driven by wanting to move fast and get the stuff in didn't think about okay you know how do we structure how do we build an infrastructure to cope and get this stuff in in a sustainable way in a way that is systematic and avoids abuse because clearly there must have been abuse you know people um and it'll come out probably in courts and in the inquiry there were some people who behaved badly who decided that actually the pandemic was a good time to try and make money rather than do the right thing uh and that's that that was the weakness in the system it's frustrating obviously because it feels like the perfect micro but then became macro example of the downfall of the conservative party from a narrative point of view because then everyone's looking for another example that is the same thing again the narrative of the greed the in you know the in club you're the inner or not and that has like just infested the whole public perception hasn't of the entire party from a what was a single moment in time let me say quite a hard one to judge because it's a global crisis what's interesting and obviously something for you to be proud of whether it's correlation or your own brilliance who knows um yeah you are absolutely the person behind the part that people really respect it was really i mean rare for british people to not complain about something to be honest but absolutely the covid rollout was one of the only things everyone's like oh well they did pretty well and i think your business experience is probably like such a defining part of that skill.

16:58Because to scale, I mean, we have seen so many, hundreds of founders, good ideas and can't scale. And it's the ability to understand how to scale something that I think... That is the toughest thing in both business and in government. And to your point, why Justin King would have been the perfect example. The toughest thing is to scale. After completing the... Zero to one. The vaccine, you know, zero to 100 miles an hour, get the system up and running, right? I was then promoted and made Secretary of State for Education. And we were doing some really great things in education. You see it now in the way our kids are moving up the league tables for literacy and numeracy.

17:36But again, you see lots of examples, T-levels, right? A great piece of innovation by a sort of Labour minister. It was Lord Sainsbury. One of the first things he did when I became Secretary of State was reach out to me and say, look can i talk to you and he showed me you know the whole t-level program which was in my department and he convinced me that actually this is really well thought through really well designed and what we should be focusing on is scaling it i didn't care who invented it you know one of the strengths i remember growing up you know with ronald reagan is is actually the real success is you don't have to be the inventor of it i'll take good ideas from anywhere as long as i can scale them it's hard The reason, again, I say to you, I was lucky with YouGov in that I found a business model.

18:23We built a mousetrap better than anyone else's that we could scale. It's hard to scale, right? Most of your listeners today who are running businesses, their biggest challenge is they look at their little business and think, God, this is brilliant. If only I could get it to the next 1 ,000 customers and the 10 ,000 and the millionth customer. And then people could see how good this thing is. But it's hard. And it's hard in government, right? It's much easier, by the way, to do lots of pilots. So the way one of the real weaknesses of government is the churn, the change. Now, it's a strength because actually democracy is important.

18:59I fled a country where there was no democracy. But what happens is a new minister comes in. Rather than saying, actually, I'm not proud. Show me all the good ideas. Show me the evidence. If it's a good idea invented by a different government, let's just adopt it and scale it. That was my attitude. too political right yeah but as my some sadly some ministers don't behave that way if it's not invented by them or by their party they'll want to just cut it right and so what happens is the civil service the the dna of the civil service is to serve the minister right and we'll you will try initially politely to say actually minister this is quite a good thing look at it properly blah blah but if the minister's adamant they get their way so then they have to start all over again with another pilot so this you know there's a sort of plurif

19:51proliferation yeah exactly um i still have to improve my english after all these years of pilots everywhere and little scale the skill of an entrepreneur i think at scale is the ability to almost do nothing and allow other people to do everything and just be a very very good decision maker and you know guide on the mission and i think that for what you did that must have been the defining skill we're all marching in this direction this is the goal we're going for you must all deliver on your degrees and that's where most entrepreneurs fail i think in my opinion i i felt that probably where the most important parts of my job as vaccine deployment minister was just to protect my team i had a great team i went to nhs headquarters is to kick the tires.

20:38There's a brilliant lady called Emily Lawson, one of the real unsung heroes of the vaccine deployment. She had a brilliant team with her. We embedded our army into the deployment team. And again, really strong leadership there as well. And what I really needed to do was just protect them from both, you know, number 10, which was nervous, cabinet officers nervous, and kept pulling them into more meetings to go through yet another presentation of, you know, have you got everything right? Are you ready? So that when the first doses arrive, you know, we're going to be able to scale quickly. And I just had to make sure that people sort of almost just held back.

21:22We had an incredible private public partnership. So we brought in Palantir to give us Foundry, the technology, so I can see literally almost in real time who's being vaccinated we brought in DHL to deliver what I call my pizza boxes to the front line to the GPs who'd come together five or six together in an area to decide you know who does the support bit for the current patient that they need to look after as well as then deploy vaccine so it was an incredible we worked with local government we worked with the Scottish government the Welsh Labour government the mayor's Sadiq Khan and Andy Burnham and Andy Street in Birmingham but I felt my biggest challenge was just to tell everyone just calm down we know what we're doing right one just give us a chance we will demonstrate for you and that's what we did week in week out as we ramped up the numbers people began to have faith and that's why the program was so successful coming back to your point about you know you hope that successful entrepreneurs the people that listen to this show consider public service and a life in business.

22:29Sorry, a life in government. Obviously, one of the big reasons people aren't attracted to government and don't go into government is you get a lot of criticism, a lot of flack from everyone. It's really badly paid. It's just not set up for career ambitious enthusiasts. And I watched this really interesting clip the other day from Tony Blair actually and he was talking about you know his greatest admiration is Singapore and the founding story of Singapore and apparently in Singapore no one can be paid any more than the people in government so the highest paid people there as a rule are all the people who work in government and so if you work in business that's the second best obviously there are going to be exceptions with CEOs founders etc but that's the general rule and so the brightest smartest people will go work in government in singapore it does seem like a very smart solution i know not everything's about money but it's really difficult when the narrative to someone starting in business is it's all on you you're going to fail you've got to figure it out um but the payoff at the end is it can be glorious and you'll learn so much everything else the narrative of going into government really is the most toxic stuff you know i see how people talk about you about boris about michael you know no no one basically lasts long enough anyway to not become the talking point or negativity and just is it worth it yes like why are entrepreneurs going into politics yeah i do worry i genuinely worry i tell you for why um that you know I don't want us to end up in a place where the only people who go into parliament and parliament is the sort of the talent pool from which we select our cabinet right that's our system that's how it works in our country is that whichever party has a majority in parliament gets to form the front bench the government right and the prime minister the leader of that party has to choose his ministers from parliament now he can promote people into the house of lords and bring them in as ministers but it's it that's the system we have right so the talent pool is from those 650 odd people who will put their name forward uh and will work you know burning you know shoe leather to get elected that's a really important process right democracy is important you know again i go back to saddam who said you do not want to live in a country where you give that up because you end up with a Saddam Hussein.

25:04But, and this is genuinely a concern for me, what you don't want is to end up in a place where either the people who are putting their name forward are people who would never be able to in any real economy command the salary of a current MP. Or people you wouldn't hire. Or you wouldn't hire them. Or people who just happen to be very rich or marry well or inherit wealth because there's a huge talent pool in between right of people who may be you know leaders in education in schools in colleges and universities in business in all sorts of walks of life but who will look at that and go you know what one i don't want the grief right the stuff that your family gets put through that you get put through the gotcha moment um in in in you know in the media um and they think actually you know i can do better anyway in the private sector that's my big concern and you look at actually you mentioned singapore singapore do it really well what they do and i met them very early on uh we had a a sort of several meetings with ministerial meetings is they peg the salary of their prime minister and the cabinet to the um salary of a ceo of their public companies so i can't remember the exact numbers but something like you know three quarters of the salary of the average of a ceo of a public company but and here's the rub right the prime minister has to deliver their strategy and they actually go on television by the way and do two hours two and a half hours of presentation to the nation of what this strategy is for health for you know house building uh welfare economic growth everything right and people watch this stuff And I wanted to do the same.

26:56You know, we built this incredible studio with a cost of 2.7 million quid. I kept saying to Boris, you know, every week post-pandemic, you know, the nation got used to seeing Chris Whitty and Patrick Vallors deliver data. We should have a minister stand up and say, here's my strategy over the next 6, 12, 18, 24 months. And here's why we're doing it post-pandemic. And I think it'll make a real difference because the first few presentations, you'll get the shock horror headline saying, oh look at this number that's terrible but once you teach people once you treat them like grown-ups then they behave differently towards you and towards the politics and you're providing two-way accountability right and you see other countries doing you know really clever things with with attracting talent you know in the uae for example uh if you're a a minister minister grade um i think after serving three years i can't remember three or four years you keep your pension for life a really really high pension as well which again it i think it's a great incentive to say to people come and serve for three four years right you're not going to lose out in fact you'll you'll do well as well it's the warren buffett thing right show the incentive i'll show you the outcome our incentives are terrible and my and that's my fear is you end up if you end up with with um uh that what I call the sort of the large mid-level talent, right, of really good people not entering the political process.

28:23I think it would be a much weaker parliament and actually much more susceptible to making mistakes or doing things badly. There is a caveat, I guess, which is Liz Truss. You know, good incentive. She gets her prime ministerial pension. Does she get the pension? she gets pension forever no yeah I mean once you make prime minister it's not bad yeah but you've got to be PM yeah I know I get it but not for that long so it's okay but just coming back to the book so after you worked on Geoffrey Archer's campaign yes you end up having a business meeting in a greasy spoon that's right and tell us not far from here yeah so where was that what were you talking about yeah yeah so Stefan Shakespeare who was my wonderful fellow traveler during the campaign.

29:13He was the only salaried member of the Geoffrey Archer for Mayor of London campaign. Stephen was chief of staff. All the rest of us were volunteers. And if you, I mean, when I look back now, I think there was a young conservative activists around that table. It was Priti Patel, myself, Tobias Elwood, Shailesh Vara, who else? Sajid Javid, Robert Halfon, right? All ended up in Parliament, pretty much. And pretty much all, bar maybe one or two, ended up in Cabinet. Geoffrey was a remarkable scout for talent and genuinely colourblind. So when his campaign collapsed, Stefan was out of work. We all went back to it.

30:01I was probably the highest paid marketing director in the land. I loved working with him. you know it's very rare that you meet a human being who is genuinely capable of original thought most of us will sort of pull ideas together there's an engineering term called clujing right you cluj lots of ideas right to come up with something that hopefully becomes a success uh Stefan is the opposite he will come up with something completely original um and uh we sat in a greasy spoon uh near his home in the Barbican I said I loved working with you uh for a good couple years being activists and trying to get this man to be mayor of london um you know we we should be able to do some do something together and i you know i if we've got a good idea let's make it happen one of the ideas we had for jeffrey remember i mean this is a different world you guys are much younger than i am and we'll probably not remember this but we still read jeffrey archer books yeah you did no but no i'm talking about something slightly different no i know it was the days of america online right dial up connections right there was no surveys online just caught that this was this was literally you know free serve was the the probably the most important uh thing that had happened in tech in the uk with a portal so when you buy your pc from curry's or pc world you got this disc with it that which loaded up as free serve and and i think yahoo was probably the biggest at the time well this was an idea for So the idea was that if Geoffrey was going to be mayor of London, we were going to call it LondonGov.

31:35And the mayor would say to Londoners two things. One, you're going to pay your taxes online because everyone paid taxes by writing a check, literally with a checkbook and sending it in, or going to their bank and transferring money. So online payments. And you would then ask people their views as to how they want their money spent. So, you know, romantic idea of, you know, Boston Tea Party, no taxation without representation. I.e., if I'm going to pay my taxes to London, I want to know how they're going to be spent. You know, how much is he going to spend on improving the roads, rail, you know, whatever it happens to be.

32:13Anyway, once the campaign blew up, there was no campaign. And so when we sat in the greasy spoon and we. Out of jobs. He's out of jobs. I was European marketing director for Smith & Brooks, a very successful business. Anyway, we came up with the idea of, well, why don't we do this commercially? He's not going to be mayor. Let's try and see if we can build a business where people pay their taxes in London and then get to tell their government how they want the money spent. And then I said to Stephen, well, why are we restricting our ambitions to just London? right this could be for the whole country in fact could be the whole world so i came up with the name you gov and it's an amalgamation of two words you and govern i you know it's consumer democracy right the internet this thing that's going to network us all together is going to shift the equilibrium in favor of we the people right boston tea party no taxation without representation right away from the executive the executive being either government or big corporates so we're going to be able to tell big corporates and government actually you know collectively we want you to do this or that or the other and that's the idea of you gov um so what was product one then i was going to tell you very painful and for all the entrepreneurs listening were you did you make money early were you profitable early no did you raise money i want to know a little we had an amazing guy called neil bruscott god bless his soul he passed away sadly from cancer who had built again an incredible business by finding a gap and filling it so he was a luggage manufacturer in the uk and uh on a train journey selling to a client he he got this magazine and he's flicking through it and he saw that in america uh luggage manufacturers were beginning to make a piece of luggage to carry this thing called a laptop.

34:11And so he built a company called, I think, Targus to effectively fill the gap when people were just beginning to move away from PC towards laptops and sold it to his American rival for hundreds of millions. Anyway, he gave us our seed funding. um do you remember the amount i think it was about 300 000 oh my father helped us a little bit as well which you know part of the reason i had a problem at the end with uh hmrc and leaving government um it goes back to that it goes back to the dad funded but my dad did both put a little bit of funding in and uh basically i had just come out of a failure of you know terrible business experience yeah and i really used it as my crutch to help me you know build the early uh sort of corporate strategy for yougov we began by trying to convince local authorities that we can build a tax payment system for them so i was going around the country trying to convince all these local authorities that you know let us give us the access to your legacy system we'll build this thing but that was tough oh my god um it was um pretty hard um graft i managed to get one out of i think something like over 60 presentations i've sold to local authorities really brutal right anyway wire forest district council um gave us a go uh we very quickly worked out that the money we'd raised will just disappear in five minutes trying to build this stuff because you had capita and eds all these giants beginning to build tax payment systems um but what worked for us was the asking people where they want their money spent the public opinion bit uh and so we very quickly pivoted and again entrepreneurs if they're smart they very quickly pivot and don't Exactly.

36:13Sometimes you get so emotionally attached to an idea that you can't see that this thing is just not going to work. We did. We very quickly dropped the tax payment investment, told YFORs, we're really sorry, we can't build this thing for them. But we focused on building a panel that is broadly representative of the adult population. And then the computers will pull a subsample of that that would be much closely representative of the adult population. and then be able to ask them questions and move basically the ability to poll people from telephone or clipboard to online. And that's the story of YouGov.

36:54And the real break we got was when we went to see Stanley Carms, who had obviously... Dixon's? Absolutely right. So PC World Dixon's exactly right. And of course was... Impressed myself. was the the the the then owner of FreeServe because FreeServe was the idea of his uh uh store manager in Manchester a guy called Ajaz Ahmed uh who'd come up with the idea of FreeServe uh and we went to see him and he said you know you've got five minutes you pair of jokers you know to pitch me we pitched him the idea of YouGov being this engine for public opinion 45 minutes later we're still in his office in in Mayfair we must be doing something right um and um He brings Agis up about an hour, 45 minutes into this.

37:43We're now talking terms about how we're going to be the news engine for FreeServe. So when you clicked on news on FreeServe, we went to YouGov servers. And what we did was we built this thing called Interactive News. So we hired young graduates from journalism school 24-7 to cull the news every day, 24-7. But most importantly, every news story had either sort of three or six questions below it that the reader would have to answer to tell us their opinion about the news story. Fascinating. To get people used to interacting with online surveys. And then we thought, how do we broaden the panel? So we hired a bunch of talent for more money.

38:29So it was Faye Weldon, because she had a particular type of readership, who's an author. One John Humphreys. One Boris Johnson. Ian Hargreaves. Peter Kellner. And they had to deliver an article for us each, I think, about on a once-a-month basis. Again, the condition is they have to ask questions of their readers. And that was part of the way we built the panel. for you gov and i guess where the real break came through is when the telegraph and enough uh they had an amazing sophologist uh called professor anthony king and anti king was then using gallop and i think nop as their pollsters for the telegraph and after the general election of 2001 where we demonstrated how accurate this stuff can be he gave us a chance and said look, we won't give you the whole contract, but we're going to contract with you for a survey, maybe once a month, I think it was, at the time.

39:40But once the industry accepted the methodology, then everything else fell into place, i.e. it's a no-brainer. It's faster, deeper, and much, much more affordable to do it online. And so we were the sort of online pioneers. Amazing. What was your biggest challenge building that business? like what was the darkest day the darkest day was oh i know the answer managing boris johnson no uh that that was relatively straightforward yes he uh the first time

40:14but but the toughest challenge was not you know invoicing anyone for about 18 months all right imagine going to work every day and you're just watching these they made no money these pounds just go out the door because all these you know we've got these young journalists working 24 7 um yeah we're trying to run the business we're trying to tell people by the way this stuff look at the data it's amazing and everyone going yeah yeah it really looks interesting um yeah i'll give you a call later we'll still use the the you know mori or someone else or you know can you remember how confident you were that it was going to succeed at the time i was deeply concerned the real confidence came i tell you where the confidence came I talked about the 2001 general election.

40:55So we had this young man called Joe Twyman, who's a friend of Stefan's, who's another great sophologist. And there is an academic study that goes around the world, the democratic world. And in our country, it's called the British Election Study. And there's the American Election Study, Australian Election Study, and so on. And it's done by the sort of the best academics in the world of polling, of sophology. and they do it at every general election that occurs in these democracies and then they write a big paper afterwards and what they do is they commission pollsters to give them their data and you had to provide the raw data not just the the sort of the the models that you predict the outcome with the actual underlying data the raw data beneath it and joe managed to get us a meeting with them uh pre the 2001 election they said this is really interesting what you're doing we want to include you in the british election study um we're doing the face-to-face and and telephone with i think it was icm and um you know one of the other pulses mori or nop or gallop anyway um you'll be the only online guys to do this the condition is you have to give us your raw data because we have to analyze the raw data as well um and by the way we've allocated all the funds to the other uh companies just what every ceo wants to hear it's a big academic right and that's where my sort of my heart fell i'm like i just thought we're going to make some money but you know we were we were drowning then and we were the challenger brand right i thought you know what let's at least go out with a bank how much runway did you have at the time oh next to nothing i mean we were just like you know living so then what happened so how did you so we we kept going um we gave them the raw data um and they wrote the the uh study up and we wiped the floor with the others much more accurate um than the others on the outcome of the 2001 general election and that was our real breakthrough i.e the the academic world then started taking notice of us Anthony King took notice of us to the telegraph management look I'd like to give them a go this is really interesting and we think the world is shifting towards these guys we were so desperate back to that desperation I took um uh you gov uh to ICM Nick Sparrow a good man to be fair to him who was at the time one of our biggest pollsters but telephone based icm research and i said look buy the company for a pound and we'll come and work for you let me show you some of this data yeah right because it's worth saving and um he wrote a letter back to me i should actually try and find it and frame it um saying nadine you know thank you for for coming and i've got huge respect and time for you and stephan and the team and joe twyman um but i put it to my board and we don't think that online online research will ever take you know play a major part in opinion research and just to be clear what was the highest valuation that you guys achieved i think we got to about 1.35 billion yeah amazing just shows the smartest people can be blind to the best opportunities so a minute ago you mentioned uh boris johnson and i think my fun question is what was it like boris johnson working for you what was that experience like incredible talent yeah um you're talking about yourself boris always always he was always yes he always late uh with his filing his piece but when it did come very good it was beautifully constructed beautifully written yeah he's unbelievable words to be fair yeah yeah i mean john humphreys was the opposite yeah beautifully written but always on time you know and super smart because he decided not to take money but to take equity which was a smart move by John Humphreys at the time but no it was an absolute pleasure to build a business and I always say look you've got to get lucky any entrepreneur says to you that they designed everything and everything worked exactly as good as they're either naive or they're lying to you right you need you need you know lady luck to smile on you well let's figure out if you're naive or lying to us then adim what was it like working for boris johnson a a privilege i'll tell you for why yeah um knife when when boris made me the the business minister he gave me a great break because i was in the business department the department i'm probably most comfortable working in because of my background um i we were making preparations for Brexit.