- Mr Ogden on making the move from high finance to computer entrepreneur
IN 1998, British entrepreneur Peter Ogden - now Sir Peter; he was knighted by the Queen in 2005 - listed Computacenter, the computer services giant he had co-founded, on the London Stock Exchange. He placed the entire proceeds from the 3.5 million shares he had floated, a total of £22.5 million (S$42.9 million), into his charitable trust.
"Entrepreneurs need to think responsibly about the distribution of their wealth," he said at that time.
Fifteen years on, Mr Ogden is still very much the entrepreneur with a social agenda. Speaking to The Business Times in the newly opened Singapore office of his latest venture, energy recruitment agency Spencer Ogden, he chats with irrepressible enthusiasm and candour about his life and career. It reads like an improbable adventure novel - PhD in theoretical physics, Harvard Business School, leadership positions with financial titans such as Morgan Stanley and Merrill Lynch, giving it all up to become a serial entrepreneur, introducing his own brand of educational philanthropy, getting knighted with reservations, owning an island, becoming a champion sailor - and he shares the details with gusto, his rugged visage lighting up as he punctuates comments and anecdotes with an easy smile and full-throated laughter.
But it is when asked about his Ogden Charitable Trust that the passion is most evident. Clearly he is as fired up as ever about the cause he holds dear: offering bright but disadvantaged young people the chance to lift themselves through education.
"When we started (the Trust), the idea was to try to get bright children from underprivileged backgrounds and give them an opportunity to study at some of the great independent schools," he recalls.
But it was "also about a change in the system", in particular the use in the UK of a Common Entrance exam to qualify for the exclusive independent schools.
"If children haven't been prepped for that kind of exam, there's no way they're going to pass it," he explains. "So one thing we did was to work with some of the big schools and say, look, you're going to have to come up with a different way of evaluating children (of these backgrounds) because they're not going to pass Common Entrance because they've never been trained for that. So we managed to introduce some of these ideas - and yeah, a lot of these kids did really, really well."
Later he would redefine the Trust's direction: "One thing you learn - if you're going make any difference, you have to have focus." A key focus now is the promotion of science education, and education in physics in particular, with the aim of nurturing a growing core of practising scientists.
"Physics has a very, very low follow-on to university," he says. "It's amazing the number of people who take physics at A-level who don't (go on and) do physics."
Ironically, that group includes Mr Ogden himself; a fortunate irony, as it turned out. A "very very good student" by his own admission, he followed up a BSc in Physics with a PhD in Theoretical Physics. He was just 24, and a promising career in teaching or research lay before him. Yet he chose to go to business school instead. Why?
He answers candidly. "I'd finished my PhD, and I realised I didn't want to be, for the rest of my life, a researcher. (I remember) sitting with my colleagues, some of them I thought were terrible, but some of them I thought were brilliant. And I thought, I'm not going to get a Nobel Prize, but one of these might." Hearty laughter. "So I thought, do something different."
Easier said than done, though. "Before I went to Harvard, I did apply to a management programme at a UK company. And they just didn't see it. They thought, what was a physicist doing there? And then it dawned; I realised you had to get something to change yourself from being a scientist to a business person. So (business school) was a great transition."
The real mystery, he concedes, is where he found the gumption to break the bank to make the leap to America, and Harvard.
"It's very hard to rationalise, because I'd come from a very ordinary working class family background, with aspirational parents who believed in education - but we didn't have any serious money, My dad was a supermarket manager for one of the very early cooperatives, and my mum didn't work. I had a small scholarship.
"But then I borrowed, I think I borrowed £15,000, which is very hard to explain - my whole wealth at that time was probably £10. It was a very gutsy, a very foolish move, you might say. But it worked out fine."
Harvard Business School proved to be a great learning experience. "The thing is, if you're a scientist, the most important thing when you're working is to find the answer, the solution. At Harvard, the answer is only the first phase; in business you've got to persuade a lot of people that it's the right answer, and then you have to implement it, you have to decide policy and structure to make it work. And that's the difference. So I'd say it was a learning opportunity."
He adds, laughing: "And a great door - you applied for jobs, you said Harvard, people gave you jobs!"
The finance industry was a natural fit because of his math background, he says. "I applied to many of the Wall Street firms. My very first job, actually, was with Continental Illinois, the bank in Chicago. So Chicago for a year, and then Merrill Lynch in London."
At Morgan Stanley, Mr Ogden served in London and continental Europe. He observes: "Interestingly, at Morgan Stanley, I was probably one of the very first of what they called quants, these people who do quantitative analysis. So, where my science became important was the fact that I was quantitative, and nobody else was. Today there are thousands of them," he notes, laughing.
The more informal atmosphere in Morgan Stanley also made possible his landmark transition to computer entrepreneur. "Today it could never happen," he concedes.
It's a delicious story, and he shares it with obvious enjoyment: "I remember I went to America, I brought back an Apple to Morgan Stanley. In those days, you had a bond, to calculate the yield you got the books out, looked at a page . . . books and books. And obviously I came back with this machine, it would go 'toot toot toot' and you had the answer!
"And that's what got me interested in computers. I realised that there was a massive opportunity for computers in business applications. And so a friend I went to business school with, Philip Hulme, he was from Boston Consulting Group, he and I got together and we started Computacenter. We hired somebody, gave him some money, gave him the strategy and everything - and after some time, we realised we'd lost all that money, the person we hired wasn't very good at all."
So the fateful decision was made to leave the secure and prestigious environment of high finance - "My family thought I was crazy to give it up," he recalls wryly - and work on Computacenter full time. The shift was dramatic. And humbling.
"It was very strange, you know. I mean, when I was the managing director of Morgan Stanley, I could call on (bankers) in London, and they would see me. And then I became a computer technology seller, I'd go to Goldman Sachs, for example, and they would say 'Go away'! So you had to be very humble, you know, going from being a Morgan Stanley top man in London, to being a salesman. A big change, that.
"Anyhow, we worked very long periods, it was all learning. I knew how to run people; I didn't know how to run the things that made the whole business tick. I had always worked with very bright, self motivated people, and all of a sudden I was working with a different kind of people, driving the truck round the warehouse.
"So we became the operators. And we started to really build it, and to grow the numbers. We suddenly knew the business very well."
Computacenter opened Europe's largest PC outlet in 1990. By 1994, it was the largest privately owned IT company in the UK. Its flotation on the London Stock Exchange was a huge success, valuing the company at about £1.5 billion. Today, it remains one of Europe's largest computer services conglomerates.
Mr Ogden modestly insists that luck played a big part in that success.
"The first thing is, by far, you have to be very lucky to get an idea at the beginning of a sales curve. If we had started Computacenter five years later, we wouldn't have succeeded. Start it three years earlier, we would have gone bust. We happened to enjoy a moment where we saw the opportunity for computers in business, and all of a sudden it happened.
"Secondly, which I think is why we became the dominant player in the UK, is that we executed the strategy better than anybody else. And that's the whole combination, how we get finance, how we pay to hire the right people . . . Other people who started at the same time, maybe 20 companies, some doing retail - they all went bust. It just didn't work out for them. So picking the right strategy, the right market sector, is key."
In which case, lightning - as in the coming together of the right idea, right time, right strategy and right market sector - struck twice for Peter Ogden. The result was Dealogic, a software company he set up in 1983 with Philip Hulme and Simon Hessel.
"Dealogic . . . yeah, great story," he reminisces fondly. "At Morgan Stanley, I ran what was called the Syndicate (desk), which was the place in the back which would buy new issues. So General Motors is going to do a new issue, (another) desk would price that, and the Syndicate would hold that, which is a risk position. And in those days, we would then go out and try to sell it. And then it became quite a bit of crisis as the deals got more and more complex. A whole raft of permutations that you had to do. So you had to make like 30 phone calls. And the problem was that the markets, while you were making those phone calls, had already started to make bets on the grey market. And it became obvious that when you got to the 31st phone call, somebody had already put in the market that this thing was now worth 90 when you were asking them to participate at 100.
"And that's when we had the idea that if we could, through a computer, transmit to 20 banks at the same time, then it would be a fair business. And they could respond electronically, which then meant that we would have got rid of this delay between the first person we invited and the last.
"And that's when I wrote the software with a young man called Simon Hessel who at that time was writing game programs. I could come up with some of the hard code and what he could do was, make it look good on the screen. And that's how Dealogic started. He (Hessel) grew the business, and today it's become very, very successful."
Other ventures followed. His latest, co-founded with David Spencer-Percival, is energy recruitment agency Spencer Ogden, which was set up in 2010 and has just opened its Asia-Pacific headquarters in Singapore. A success from Day One, it revels in its tag of "world's fastest growing energy recruiter".
For Mr Ogden, it's another example of his tried and tested business formula.
He elaborates: "When you start these new ventures, you bring the finance, which is essential. And also, hopefully, you bring the experience of working in partnerships. Most of my businesses that I started, including the two big ones - Computacenter, Dealogic - have all been done in partnership. Partnerships can be very fragile, fractious, or friendly. You build a good relationship with the operator, with the entrepreneur. And it's something I've become quite good at."
In addition, finding the right people and training them "is really a key element of the business model", he says.
"It's the idea that we can build the business, not by just recruiting people from other competitors, (but rather), can we start with new people, and train them. That builds a different category of employee, and that builds loyalty as well."
A distinguishing feature of Spencer Ogden is its Graduate Academy, an intensive three-month training programme designed to turn raw graduates into highly capable recruitment professionals.
In Singapore, graduates from three local universities, plus Singaporean nationals who have studied abroad, went through three rounds of interviews. Successful applicants then went into training with The Spencer Ogden graduate academy.
Notes Mr Ogden: "You give them an opportunity, some of them will like it, some may not, some can't (make it) . . . but 75 to 80 per cent stay on with us."
With all the energy he puts into his work, it comes as a bit of a surprise to learn that he actually started winding down some 13 years ago.
He reveals: "Around 2000 I thought, 'I don't think I can do this again, I don't think I can start with another office.' So I gave up my office. And I started to become one of those who work on the Internet from home, I gave up all my responsibilities day to day. Like, in the old days Computacenter would call me to get my view on this or that; and nowadays they only call me when they want to do something really stupid, 'We'd better tell you . . .'." Again, that distinctive laugh.
It helps that he has his own island, Jethou, part of Guernsey in the Channel Islands. He recalls, chuckling: "In the nineties, the island came up for sale, it was advertised in all the English newspapers, Paradise Island and so on. I hadn't read the papers that day but my wife read the paper and she immediately tore it up and threw it away. She thought, 'If he sees this . . . ' She was very protective. (But) I must have got five phone calls, everybody thought that an island would be something I would want.
"Up to 2000, it was more like a holiday place. But as I started to wind up, I started to go there a lot, and had a lot of solace there. It's an absolutely beautiful place. It's very quiet, and I love it. So all the time I can spend, I go there."
Jethou is also the name of his yacht, which he sails competitively, winning the 2012 Rolex Volcano Race. So, yet another passion? He counters: "Who wouldn't be passionate about sailing? All that water and sunshine!"
OK, last question, sir: What did you feel when you learnt you would be knighted?
And unexpectedly, for the first time in the interview, the great man is at a loss for words: "That's a hard one . . . umm . . . yes, it's a hard one."
Then, honest as ever, he confesses: "I would say that when I was younger, I had some reservations about the Honours system, you know. Maybe I was a little Left."
He laughs almost apologetically, and continues: "So we (the family) had a quiet sitdown and chat about it; I mean, we've had our reservations in the past, what should we do here? But (in the end) I accepted it. Obviously, it's a great honour, it's fantastic. And I give some credit now, the Honours system in the UK is improving all the time, it's going more and more to people who do deserve it. I can say I deserve it, but I can tell you, there are some people in the charitable trusts who are far more (deserving), and yet sometimes, they never get any recognition. So as long as the Honours system keeps pushing in that direction, I guess I'll support it."
But getting to meet the Queen was "so good", he says. "I've always been a monarchist, so yeah, that was a real privilege. She's very very nice."
He volunteers: "My mother's a hundred (years old), and I took my mother, my wife, my daughter, and we had a lovely day. Nice lunch with the whole family."
He pauses, then adds, laughing heartily, "That's called mellowing with age."
Born May 26, 1947 in Rochdale, England
1968 BSc Physics, University College, University of Durham
1971 PhD Theoretical Physics, University of Durham
1973 MBA Business Studies, Harvard Business School
1976-81 Exec director, Merrill Lynch International Bank Ltd; managing director, Merrill Lynch White Weld Capital Markets Group
1981-87 Managing director, Morgan Stanley & Co; advisory director from 1987
1981 Co-founder/chairman, Computacenter Ltd; non-exec director from 1998
1983 Co-founder, Dealogic
2010 Co-founder, Spencer Ogden
1999 Chairman and Trustee, The Ogden Trust
1999-2010 Honorary positions/degrees from University of Cambridge, University of Durham, University of Warwick, Institute of Physics
2005 Knighted, New Year Honours List