Alistair McLean

Name:

Alistair McLean

Business:

Activities Abroad

Web site:

www.activitiesabroad.com

Years in business:

7

Number of businesses:

2

Entrepreneurs' Forum member

I never had a vision to be self employed, but that was before I realised I was in actual fact, unemployable. You hear about Peter Jones setting up his own tennis academy when he was sixteen. It would never in a million years have occurred to me to even sell sweets to my classmates in school or something. But there does come a time when you realise, you just can’t work for anybody but yourself.

I dropped out of uni when I was eighteen. The five years after that are what I like to call ‘the lost years’, a phase of alcohol, drugs and unemployment. When I was twenty three I sorted myself out a bit and got a job as a stockbroker, then proceeded to waste six years of my life.

The stimulus to do something with my life didn’t actually happen till I was twenty nine. I sat in the personnel office of the stockbroker firm who said they saw me sitting in the corner checking off contracts for the rest of my life. To put it mildly, that wasn’t really where I wanted to go, and these people obviously didn’t have much of a vision for my future either.

So I saved frantically for six months, packed my bags on the back of a bicycle with a tent and cooking gear, and proceeded to cycle across Europe. I picked up various pieces of work along the way like grape picking in Burgundy, leaflet distribution in Düsseldorf, just to raise a bit of cash.

I found myself in Cyprus with a ticket to go to Israel, but then I ended up on an operating theatre. Let’s just say that put paid to the cycling for a while.

I flew home, sat in my parent’s house with no money, no job and no prospects. I decided to get a blank piece of paper and just write down what I liked doing. I was thirty years old and thought my destiny should be defined by now.

On the top of my list was travel and adventure sports. I enrolled on a travel and tourism management course at Northumbria University, after which I got a couple of jobs with some local tour operators.

I had a great boss; he was a brilliant energiser and a fantastic ideas person, but a bit frustrating to be his right hand man. One day he called me into his office and started scrolling on these post it notes saying do this, do that, and I kind of snapped. I told him to stuff his job and I walked out.

I went home to a really quite unhappy wife, then woke up the next morning and surprise surprise I was unemployed. That’s when I sat down and really thought seriously about what the hell I was going to do with my life. I realised that I was unemployable; quite simply, I couldn’t work for anybody else.

So I set up my own travel firm in Newcastle in 2000. We’d just managed to get a massive loan to expand the business but the day after the money went into our bank account, 9/11 happened. Nobody flew or travelled anywhere for two years after that.

I made sure that all the people who had booked with us got on their holiday; made sure I did everything the right way, but then I had to wind the whole thing up.

My wife was working at the time so we were kind of breaking even, without servicing the amount of personal debt I’d managed to accumulate. I thought for about a nanosecond whether to go out and find a job, but I thought, no, I’ve got to try again.

I started asking for more money from private equity companies and that sort of thing, but nobody would touch me. Travel businesses weren’t exactly something people wanted to put their money into at that time. I went to every bank in Newcastle, put together a business plan saying how I was going to do it differently this time, but everyone had a red flag.

Also, I think it’s this UK attitude to failure. In America, they barely touch you if you haven’t had a failure; if you haven’t had that feeling in the pit of your stomach, hated it and managed to come back again.

Back home though, it was a really bad time. I’d thrown a lot of my own money into the business to try and keep it afloat. I nearly lost my wife, I nearly lost my house, and my credit rating was shot.

It takes a lot to pick yourself up after being in such a financial mess. I remember a particular instance when we’d invited a few friends round for some drinks. Our old C Reg Astra had started leaking oil and stopped working so me and my wife wheeled thirty six cans of cheap lager in an Asda shopping trolley down our street. We looked at each other, and it was just this realisation: how did we get to this point? We had the drive and motivation to get ourselves out of this; we just needed to do it.

As it happened, my accountant managed to raise three investors who put money in again, despite what the banks were saying. It wasn’t a particularly large amount, but it got us going. He still retained faith in me and my idea, which I’m grateful for to this day.

I was concerned at the time about people at the stockbrokers getting wind of the failure and finding some sort of grim satisfaction in it. But I got over that pretty quickly. I can look back now and I’m probably more satisfied than any of them. I have a great family life and I absolutely love my business; I’m so proud of it and at the moment we’re getting into very exciting times with plans for the future.

Circumstances were heavily against us, but I’ve learnt so much from that first time round. That’s the essence of business for me: learning from mistakes. Stuff I should have done the first time round strategically, tactically, operationally, I’ve implemented straight away the second time round. The failure of the last company has turned out to be the success of the current.

In the first business, I had no confidence whatsoever in my own ability. I didn’t know what I was doing and I had other people make the decisions for me and I just accepted them.

I was also quite naïve. I was repeatedly told during my degree that seasonality has a huge impact on travel companies. It’s all very well customers going away in July and August but there’s ten other months in the year which you need to service in order to stay afloat.

For some reason I didn’t put anything in place to cover any of the other months. So I had a wad of cash in August, only then did I realise that, hang on, this has got to last me until next July. I didn’t learn the lesson that I had drilled down my throat whilst I was at uni so I completely screwed up there.

The first thing I did when I set up the new company was to regain my confidence in decision making. I set up summer and winter holidays; making sure that we had positive cash flow throughout the year. And actually, in terms of profitability the winter months probably make more for us now.

For every client that goes away, they get a comprehensive questionnaire to fill in. I know some people don’t like to give feedback, but we try to get as much information out of our clients as possible, and we actually listen to what they say. If something was reoccurring in one destination that people were unhappy about, we would talk to our suppliers and seek to resolve it.

One lady went with one of our competitors for a while. When I asked her the reason, she said that they sold holidays specifically for families with teenagers. So next year we’re going to put in a few teenage trips. You’ve got to keep an eye on what your competitors are doing, and perhaps steal a few ideas. They’ve certainly stolen plenty of ours.

For the first company the advertising was based around Sunday broadsheet newspapers. But then we realised that there was this little thing called the internet that was starting to make a bit of a splash.

In the second business, the entire marketing budget went into web marketing. We figured that the kind of people who wanted adventure holidays would be the kind of people who would embrace the internet. Whether by good judgement or sheer luck, that’s how we built our database.

One of the original travel companies who are ten times our size said to us, ‘You guys really stole the march on everybody with pay per click advertising and search engine listings. You realised before anybody else.’ We hadn’t actually realised that we’d realised before everybody else but there’s a global audience out there and that’s essentially where we got our market from.

Now though we’re looking at different ways of marketing. Everybody’s obviously caught up with us on the internet. Before we would pay 25p to be in the top three for activity holidays on the search engine. Now we’re paying £1.25. It’s become incredibly expensive. Last year we spent £100,000 on pay per click advertising and the whole thing has become increasingly sophisticated so we’re actually reviewing the whole thing.

One of the biggest challenges in business is making sure you have the right team around you. The first guy I had with me did some data input and has been a mate for over twenty years. We’re both similar ideas people, and we kind of built the business together. God knows how we did it.

I used to do all the admin. I was in the office until two o’clock in the morning typing out dossiers for people’s holidays. When I think about that I shudder because my organisational skills are awful.

I was in London on my work placement from uni when I met my wife. She came in five months after I’d started and took over one of the teams who were quite behind. She did an amazing job at organising them. I knew that the first employee I wanted, once I got the business on a firm financial standing, was Kate.

Kate had faith in the business and came in as the office manager/ administrator. She’s got this amazing coordinating capacity. She can get the kids washed, dressed, fed and off to school in twenty minutes. That would take me about a day and a half.

Whilst I was on a Business Breakthrough course I learnt about the best way of putting a team together. We studied the psychological stuff; why people are like what they are and finding the right balance of talent in your employees.

Apparently I’m an energiser. The opposite to me is a concluding achiever. We’ve got a guy coming in next month who’s exactly like that. Whilst we complement each other, we have to be aware that sometimes we’re going to drive each other absolutely mad. He wants me to get his contract sorted. I can’t be bothered to get his contract sorted! I’m really looking forward to him joining the team as I know he’s going to take us a step up, but we need to find ways of sorting those kind of issues in advance.

I used to think that business was all about maximising profitability. Now though, I see us as having social responsibilities. Our holidays go to rural areas, small towns and villages. On every trip we adopt a local project and contribute to it. At the moment we’re doing a project in South Africa in an orphanage. Children have no home, they’re living in squalor and they have no education.

We’re doing very well as a business; I’ve got more money than I need, but we’re in the position where we can help other people as well. Next year we’re doing the orphanage, a reforestation project in Costa Rica and an environmental trail project in Canada. We’re looking into going to Brazil and Cape Town as well and adopting projects there. It’s fantastic that we’ve got the stage where we can put something back into the places we go to. It’s not just about us, it’s about our employees, it’s about our suppliers and it’s about the communities where we send visitors.

As a result of the business I’ve got no financial worries. It’s January now and I haven’t paid myself yet; I’ve still got money left in the bank from last month. That’s never actually happened to me before. But we’re not materialistic. I drive a Skoda; I’m not after the glitz and glamour. All I want is to see my kids grow up happy and to love my job as well.

If you’re thinking about starting up your own business venture, all I would say is get a mentor. Find somebody who can guide you. Business is a steep learning curve and you need somebody who’s been there before and has got the experience.

You also need support. I’ve got people around me whom I trust immensely; people like my wife who stayed with me when the first business failed and when I went into quite a dark, depressed phase. But she and others had the strength to go with me again and that support’s been invaluable.

You have to be prepared to put in the hours initially. Now though, I’ve got a great work- life balance. I make a point of seeing my family as much as I can and the business has given me the opportunity to do that.

Setting up my own business didn’t feel risky. I’d just told my boss to stick his job so it couldn’t really get any worse really. People often think, it’s a completely new experience, what if it doesn’t work out, what if I don’t enjoy it? But that’s what’s being an entrepreneur is all about: taking the opportunity to try new things.

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