Igniting Entrepreneurial Sparks (#28)

Igniting Entrepreneurial Sparks,
w/ Michel JORDI

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Full podcast transcript:

 

We were four people at the launch of Le Clip. Six months later, in November, we were 50 people, and we produced 10,000 watches a day.

Ben: Michel, welcome to the podcast!

Michel: Hello, everybody! Thank you for having me here! I’m looking forward to a great talk with you!

[00:01:37.17] Ben: So Michel, in preparation for this podcast, we read your book — we read ‘Ignite That Spark’. I mean, it’s a wonderful book! You could call it a self-help book for entrepreneurs, but I think it’s more than that. I think it’s really a celebration of entrepreneurship. And so, we’re going to talk about this book, in quite a lot of detail. But I hadn’t realized, until you arrived this morning, that you’d also written an autobiography because my impression of this book was that, you know, I loved it, I would advise everybody to read it. It’s a very easy, compelling read, but the bit that it misses a bit is your life story. And then, when you arrived this morning you said, “Actually, I’ve got this massive tome, which is my autobiography.” And so, if you don’t mind, can we start there? Can we start with just a little bit of your background? How you entered the watch industry? You did your first startup at 23 in Japan — how did you end up in Japan? So, if you don’t mind, could you fill in the gaps on Ignite That Spark and tell us how you started in this industry and why you were in Japan in the first place?

my dad was my first role model, the perfect example of what I really did not want to do with my life — Michel JORDI

Michel: Yeah! It sounds interesting, thank you very much! You know, life is a journey and it’s a learning process. We learn every day. I’ve been a very, very curious person, enthusiastic, loving life. When I grew up, my dad had eight-to-five jobs, leaving every morning at 7:30, coming home for a one-hour lunch break, and go back to work until 5 PM. And when I saw him in action, my dad was my first role model, the perfect example of what I really did not want to do with my life.

Ben: Yeah, sometimes happens.

Michel: I mean, I decided right there in my teens, “This is not what I’m going to do. I want to be independent, to break free, to be my own boss in planning my day.” This was really my goal. Fortunately, I had a fantastic mother who, when I was 18 or 19, she said, “You have to go to England. You have to study English because if you don’t speak English you’ll never get anywhere in your life.” So I went to England — actually, not in London. I was at Leeds University, which was great because nobody spoke German or French there, so I was forced to speak English every day and to learn it quite quickly. I must say, it’s a great language — the language of Shakespeare, which I love very much. When I came back, my sister had already moved to Geneva because she wanted to improve her French and she said, “Why don’t you come down here?” So I still remember, 16th of April 1969, I ended up and I slept on the floor in my sister’s studio. That was my first night in Geneva. I immediately was very quickly in a company in Geneva, a watch factory. It was a time when the Japanese watches became very strong — Seiko, Citizen — and all their watches had metal bracelets, except the Swiss watches. We had only leather straps. And I remember, they put me in charge of the purchasing department there, at that watch company. And our salesmen always complained that we did not have any metal bracelets. So they told me to seek for metal bracelets. So, I looked around and I realized that the manufacturers in Switzerland, first of all, they were only very few and very expensive — 50 francs or more a metal bracelet. So, I looked around and I realized that all these bracelets came from Asia — Japan, Hong Kong, Korea.

[00:05:14.28] Ben: At that point, was the Swiss watch industry losing competitiveness because it didn’t have metal straps?

Michel: The Swiss watch industry was in deep trouble — really threatened by the Japanese watch manufacturers. As I said, Seiko, Citizen, Ricoh, Orient — these were the four big ones. But it was not only the bracelets, but technological changes. Number one, there were the quartz watches because the Swiss, although they invented the quartz watch, they didn’t believe in it. The Japanese used that technology and they made the watches always thinner, and thinner, and thinner. And the Swiss watches were big potatoes, heavy potatoes. Nobody wanted them in the world markets. And in addition, in all those warm and hot countries, humid countries, a leather strap is dead after three or four months. So that’s why the Japanese have metal bracelets. And I wanted to bring those metal bracelets to the Swiss watch manufacturers, as well.

Michel: So, I left for Japan — I was 23 years old — made a joint venture which was my first startup at age 23. And there, in Tokyo, I remember I had 10,000 Swiss francs in my pocket, and I knocked on the door of the biggest major bracelet manufacturer in Japan — 3000 people. And I remember as if it was yesterday, the president of the company, the chairman of the company, he received me there, I explained to him about my dream, what I wanted to do. He did not even let me finish my sentence. He just came out and said, “Jordi-son, you must have a big dream!” And so, he told me, “Look, if you don’t have big dreams, you never get anywhere.” You know, I expected that we would discuss five or 10-year plans. The guy spoke of the 21st century and the Silk Road long before it was a thing. He said, “Jordi, I’m going to make a silk road to Europe and you will be my first link.” That’s where it started. The bracelet was my first business. I founded that in 1971. And after about 15 years, I kind of got tired. I mean, business was flourishing, we made 25 million Swiss francs in sales with metal bracelets. I was the biggest supplier of metal bracelets to the Swiss watch industry. Everybody used my bracelets.

Michel: And then, Le Clip was my second company. The way Le Clip came along: I was always looking for new designs for watch bracelets, and we worked with a lot of freelance designers. And one day, I came into an office of designers, here downtown Geneva, and there was a drawing of a clock in the shape of a closed pack. There is a big clock, those taper clocks which you put in watch stores as advertising. And when I saw that clock — this was in 1985 — it was just shortly before the Swatch watch was launched. And when I saw that, it was within one night; it was a spark, really. A spark. I saw the whole business plan, I saw this, instead of a heavy brass clock, I saw that in plastic with colorful fancy designs, and to be clipped on and wore anywhere, everywhere except on the wrist. And so, the next day I went back to these guys, I bought the drawing for 1000 Swiss francs. And then, I developed the whole thing. And that was in September 1985. Le Clip was launched on June 10th, ’86. I mean, seven, eight months later, we were on the market.

[00:08:55.11] Ben: When did the Swatch watch come?

Michel: ’82 or ‘83.

Ben: Okay. So you were riding the wave.

Michel: Yeah. I was riding the wave. It’s true.

[00:09:06.25] Ben: Yeah. One of the anecdotes I loved from the book is that… So, you’ve spotted the opportunity to do something a bit different with Le Clip and you got some investors on board. And then, you said those investors became a bit nervous and they wanted some external party to validate the opportunity. And they called on McKinsey to do so. And McKinsey pretty much rubbished the idea, right? Or at least said that you couldn’t price it at any sort of premium. And you chose to just completely disregard the McKinsey report and just launch anyway, at the price point you’d already thought.

Michel: Yeah. I’ve mentioned this in my book, Ignite That Spark. For me, everything starts with a vision. And my vision was so clear about this Le Clip watch. I mean, as you said, I took the Swatch watch as a benchmark. But it was not a wristwatch. And our slogan, actually, was “The watch to be worn everywhere except on the wrist.” That was our slogan. And, for me, it was clear I had to position it at the same price as the Swatch watch — 50 Swiss francs. Not 49.95 or 51. It had to be 50 — exactly the same thing, with the same very, very trendy, colorful, advertising and promotions. And I was just sure. I work a lot with my guts. I listen to my guts. And I had the gut feeling that this was the thing to do. And I put 35,000 watches in production.

Michel: And in the beginning, the problem was I couldn’t find any retailers. Nobody wanted to buy that watch because it is not the watch you sell at traditional watch retailers. They didn’t look at it as a watch. So, I went to see department stores. And department stores loved the idea because it was colorful, they saw the success with the Swatch watch. And the big advantage that you have with the department stores is you get a lot of frequency. People come through. They just go through these stores, they see it, they look at it. And at 50 Swiss francs, you impulse purchase. But still, my two partners were afraid. They said, “Michel, you have to make market research.” So we did market research by McKinsey. And the report came out just about a month before the launch. It was devastating! “No one will buy the product. Totally useless. It’s a gimmick. Who the hell cares about a watch in a closed pack, and what is the watch for if you can’t wear it on the wrist?” And I used that, actually, as my promotional slogan: “The watch to be worn everywhere except on the wrist.”

[00:11:49.26] Ben: There’s a great photo in the book, with “You’re wearing it everywhere but the wrist”.

Michel: Yeah. Actually, we made the front of the People Magazine in the United States. Front page! And People Magazine into circulation is three and a half million, with 46 million readerships. We made the front page of People Magazine! It was amazing!

[00:12:10.10] Ben: So, please buy the book, but if you don’t — this is a photo of Jordi and he’s got watches hanging off his mustache, his hair, his eyebrows, his ear, his finger. It’s a very impactful image.

Michel: Yeah. And if you turn the page, you see Andy Warhol, who came as a special guest for the launch in New York, in October 1986. And, actually, he told the journalist, “I’m waiting for Michel to make a version to clip on my contact lenses.” I loved that one! He was a great guy!

[00:12:48.06] Ben: So your lesson from the McKinsey incident — we’ll call it that — was that you can’t put too much stock by market research. It can essentially prevent you from doing what your gut tells you — and your gut is sometimes a better yardstick of what might work than market research.

Michel: Yeah, for me, at least. I mean, I listen to my gut. Everything I do, I listen to my gut. Which, of course, it doesn’t mean that you’re always 100% right. I mean, sometimes you know, it is a little bit trickier. What market research does not do is it does not take into consideration your advertising expenditures and your promotions. I mean, we sponsored the Montreux Jazz Festival. We had an advertising budget of a million Swiss francs in 1985 or ’86. That was a hell of a lot of money. We had TV commercials, billboards, and the Montreux Jazz Festival. And people just loved the product! I mean, it took off like a rocket. We sold 1 million watches for 23 million Swiss francs in the first year. I mean, imagine, that’s almost 2 million per month for a startup in which the McKinsey report did not believe in the product at all. We were four people at the launch of Le Clip. Six months later, in November, we were 50 people and we produced 10,000 watches a day. I mean, just structure-wise, organizational-wise, everything was just so fast. It took off like a rocket. In all of my life, I’ve never lived anything like those first six months. It was just absolutely unbelievable! The sky was the limit — I can say that!

[00:14:42.29] Ben: And how did that feel?

Michel: It felt fantastic! It was so motivating! It was actually uplifting. We were like on a cloud. We were just running through the world on a cloud. It was unbelievable!

[00:14:59.08] Ben: One of the things I also liked about your book, which resonated with me was — I mean, it’s obvious when you talk about your dad’s life story that you wanted something that was in opposition to that rigid corporate life. But then, what you say in the book is that, as an entrepreneur, you feel the highs so much more and also the lows so much more. And so, I can just imagine how it felt to, first of all, prove all the naysayers wrong. And then, to get something out there, where you’re producing, 10,000 watches a day, and everybody wanted it. I mean, I can just imagine how that felt.

Michel: Yeah! I mean, department stores like Grand Passage in Geneva or Globus in Zurich, they had to empty their cash register on big days — Friday, Saturday — they were doing it three times a day. There was so much cash, they couldn’t put the cash anymore in. At that time, you didn’t pay by credit cards. You paid cash.

a lot of people say, “The business plan is dead, forget about the business plan.” I think it’s totally wrong. — Michel JORDI

[00:15:53.28] Ben: Yeah. That’s wonderful! So I guess, also, you were very much part of the renaissance of the Swiss watch industry at that time, right?

Michel: Yes! Which, as I said, was initiated by the Swatch watch. And this came along. It was in the same trend.

[00:16:09.29] Ben: So, in this story in the book, you talk a lot about your gut instinct. You also have this — you call it, ‘ready-fire-aim’, right? This idea that if the timing’s right, you’ve got to get something into market, and then you can iterate after that. But, at the same time, you talk a lot about the importance of writing a detailed business plan, documenting the mission, the vision. How do you reconcile the ready-fire-aim mentality with having really detailed business plans? Because this was one thing where I kept reading those two statements in the book and thinking “I’m not sure they’re completely consistent.” So I just wonder how you, yourself, reconcile those two.

in discussing with young entrepreneurs who always say “I have a great idea, I want to do this and this.” I say, “Put it on paper.” — Michel JORDI

Michel: The book is divided into four parts. Part one talks about the lucky clover, which is the first four commandments. And those first four commands are vision, guts, different, and timing. And I think these four are so important — and what I’m telling all young entrepreneurs is, “Fill this out — that lucky clover — and evaluate it with notes from zero to 10, for each of the four leaves. If you hit 40, you’re gonna have a home run.” In those three companies, I always had 40. And that’s why the three companies became international successes. I mean, Le clip, The Swiss Ethno watch, the Twins Heritage — they all were 40 point measurements on the lucky clover. But if you’re below 30, I think you should really worry about what you’re going to do as an entrepreneur.

Ben: Yeah.

The only thing that changes all the time is the market. So adapt to it. If you want to be successful and stay in business, you have to adapt to the market. — Michel JORDI

Michel: Then you have to start to measure what is missing, which of the four parts are not correct? What I’m trying to say in this book because a lot of people say, “The business plan is dead, forget about the business plan.” I think it’s totally wrong. Well, what I think is, it’s almost impossible to do and what is not right is when people ask you to make sales projections for the next three to five years. This is extremely difficult, especially for a new business. But what is important in writing your business plan is going through the thinking process of your business. It’s like what I also explained afterwards in my rainbow target, which talks about marketing, price positioning, and all these different things. It is very important, when you write a business plan, it forces you to go through the thinking process of your business, and then, suddenly, you get stuck somewhere. Did you think about distribution? Did you think about marketing? Did you think about the point of sale? All these things, you have to think of it. And I felt, in discussing with young entrepreneurs who always say “I have a great idea, I want to do this and this.” I say, “Put it on paper.”

Ben: Yeah.

Michel: The minute they put it on paper, they get stuck. They don’t know what to write on the paper. That’s what I’m trying to say, if you cannot put it on paper, that means your vision is not clear and it’s going to be very, very difficult to reach your goal. But then, as I also said, ready-fire-aim means you cannot always get all the parameters 100% the way you would like to have them, because there’s some gray zones. You don’t know exactly what to do. If you want to, just aim all the time, you can aim for 2,3,4 years — you never shoot. So there comes a time, there’s a certain factor of risk involved, you have to shoot and then aim as you go along because then, you really, in the real world, you’re in the market, and you have to adapt to that market at all times. Markets are changing. The only thing that changes all the time is the market. So adapt to it. If you want to be successful and stay in business, you have to adapt to the market.

[00:20:16.16] Ben: Yes. Jeff Bezos talks about this idea of being able to take decisions when you’ve got 80% of the available data.

Michel: Yeah. Exactly!

[00:20:26.15] Ben: So what you’re saying is a business plan for you is making sure you understand the big blocks that will be needed to be successful. So, understanding your go-to market plan, understanding how you’re going to do marketing, distribution — but it doesn’t have to be completely precise. And there’s no point in doing five-year projections.

Michel: Absolutely! I totally agree! No, I mean, as I said, you cannot always have everything right. There is a gray zone, which you only know once you’re in the market. That’s what I’m saying. Then you start to aim.

part of the problem is when you make a disruptive product — like Le Clip and also the Swiss Ethno watch — if you want to make a market research, you’re going to meet some people. They all say ‘no’. Do you know why? There are no benchmarks. They cannot compare with something existing. — Michel JORDI

[00:20:56.29] Ben: Tell us a bit more about the Swiss Ethno watch.

Michel: Well, as I said, I mean, from Le Clip, the problem with Le Clip was it grew so fast that I just couldn’t finance the whole project. I ran out of cash. So, I had to bring in an investor. And I was very naive and believed everything he said, instead of taking a lawyer or an advisor with me to make sure we all do every step properly. I trusted my two former partners, that they will take care of that part. But instead, they partnered up with the new guy, and they kicked me out. So I mean, a naivete. I concentrated on business, whereas they concentrated on what is the best way to kick him out so we can take control of the business, you know? And then, of course, I didn’t know what to do.

[00:21:55.29] Ben: You’re right! I’ve missed an important step, which was exactly this point, which is, you lost control of your own company. And I think this is, again, one of the lessons you draw in the book, which is around managing cash flow. Because this is a classic case of, you just grew so fast, there has been such working capital pressures on the company, that in the end, you had to take in what we might now call ‘vulture capital’ — you took in capital that came with, ultimately, in this case, really horrendous repercussions. So, talk to us a bit about some of those lessons. I mean, I think there’s a whole section here.

Michel: Yeah, it’s commandment number 10 — Cash Flow. Cherish your cash. Cash is your oxygen, as in if you run out of it, you die. But again, I went to IMD, I went to Harvard. That is exactly what they tell you everywhere: “Be careful. Don’t run out of cash. Grow slowly, because if you run out of cash, you may lose control.” That was the situation with Le Clip. And there was just no choice. It just went through the wall! You can’t stop it. You can’t stop it. But then, I mean, maybe today, what I would have done differently, I should have immediately taken my personal lawyer or advisor and make negotiations myself instead of my first partners doing it. Because, in the end, they just partnered up, as I said, with the new investor and kicked me out. I mean, the guy promised to invest seven and a half million Swiss francs in 1987. That was a hell of a lot of money. He brought two and a half million. The rest never came. So, I took a lawyer, I started to attack him, but I had already lost the majority when the deal was done. I was below 50%. And he brought only two and a half million. What can you after it? It was too late! I couldn’t come back. I mean, I was kicked out but as I said, in hindsight, you’re always smarter, you know what you should have done differently. I just had to acknowledge that this was one of my learning curves, one of the things which did go wrong, but I knew should have been done differently. But I can also say that had there not been Le Clip, there would never have been the Swiss Ethno watch because I couldn’t do this with the Ethno watch, without all the lessons, everything I learned from that first experience.

[00:24:34.06] Ben: And so, talk to us about the Ethno watch. First of all, where the idea came from, how you executed the idea, what you did that was different from Le Clip? So, building on the learnings from Le Clip.

Michel: Well, first of all, Le Clip was sold at 50 Swiss francs, it was a fashion accessory wore everywhere except on the wrist, but the Swiss Ethno watch was a classical wristwatch to wear on the wrist with a leather strap. But, what I did differently because after Le Clip, I made a trip around the world to see former friends, to get ideas, brainstorm what should I do next. I mean, I was devastated, I lost my ground, I had a family to feed, I had two kids. And I knew only one thing: that I wanted to remain free and independent. So, no way that I would go and work for somebody else. So I went around the world, saw old friends, and asked for advice, “What do you think I should do?” And several of them said, “Make your own watch. Why don’t you make your own watch?”

Ben: Yeah.

Michel: As I said, “Who is ever going to buy a watch where it says ‘Michel Jordi’ on the dial?” I just couldn’t envision that at this point. I didn’t have the confidence to put my name on the dial. It was my wife, actually, who convinced me. She said, “You have to do it!” She felt it was a great idea! She’s Korean origin, she has a big spirit and can think big. After a few months, I decided, “Okay, let’s have a go!” And then, these people I met around the world in Singapore and Japan said, “Why don’t you make a typical Swiss watch? Like the Swiss Army knife.” Now, what is so typical about Switzerland? The most typical symbols we have in Switzerland are the cows and the edelweiss. So I took to cowbell, embroidered the edelweiss on the strap, and the cows went in circle around the bezel of the watch — That’s exactly it. It was amazing! It was an amazing timepiece. But, again, part of the problem is when you make a disruptive product — like Le Clip and also the Swiss Ethno watch — if you want to make a market research, you’re going to meet some people. They all say ‘no’. Do you know why? There are no benchmarks. They cannot compare with something existing. So, they said, “This is a kitschy tourist trap. No Swiss will ever buy the product. Maybe you can find some tourists in Interlaken or Lucerne.” But I decided to do it anyway. I put 10,000 watches in production before I even had an order.

I did not sell folklore, I sold lifestyle — Michel JORDI

Michel: And, again, retailers didn’t want to buy it. I decided to make it rare and limit distribution to only 100 product sets. But each one of them had to invest in a package of 100 watches for 20,000 Swiss francs. And I managed to get them together. It was very, very hard work, a lot of persuasion, a lot of traveling, but finally, thanks to Bucherer — the big retail chain store, Bucherer — they ordered 1500 watches as a starter. And once I had Bucherer on board — the best retail in Switzerland — all the other followed because if Bucherer says that’s fine, then, I think it must be something good. So, I managed to put them together. I made an amazing launch. I invited them to launch the product to the cradle of Switzerland, at the shores of Lake Lucerne for an unbelievable launch party, for which they had to dress in their Swiss national costumes. They were all motivated and joyful. They all went home and said, “We’ve got to spread Swiss Ethno fever”, and suddenly the product took off. I can also say, one thing is, we spent one and a half million at the launch party, advertising, and promotion-wise. If you cannot advertise heavily in promotion, you don’t have a chance to bring the message across.

Commitment is 200% and you never think about the plan B, when you start. It’s impossible. — Michel JORDI

[00:28:47.04] Ben: Yeah. Because you’re trying to persuade people to change their buying behavior.

Michel: It’s a must. You have to make it a must. I wanted it to make it a must. But I did not sell folklore, I sold lifestyle. The most important thing was to sell it as a lifestyle product.

[00:29:04.23] Ben: There’s a few things to delve into, here. So, one is marketing. I mean, I’m a marketer myself, and so, I loved some of the things you were saying in the book about marketing, because my frustration or my critique of a lot of marketing efforts is they put too much emphasis on just one of the P’s — promotion. And what I liked a lot in your book is you talk a lot about the other three P’s. And one of the things you talked about a lot was these launch events and the impact you can have of getting something on the radar of people, of the consumer who’s time-poor, of the publications who are stretched in terms of resources. And so, a big launch event could catalyze the branding and the marketing of something new. So, can you talk to us about that? Because I think that, again, there’s a lot on this in terms of these launch events.

Michel: Yeah, it’s crucial. I think it’s crucial in our success. If you only advertise or communicate through classical marketing, you have those beautiful pages in magazines. But today you open a magazine, there are tons of advertising. Tons of advertising, also, of watches. But people don’t talk about an advert. They just turn the page. But when you make a crazy event, like what we did — we made a fashion show at Piccadilly Circus with cogs, a Swiss Folk group, and Swiss flags, as well. I mean, Piccadilly stood still. And then we made the Swiss Primetime Evening News. I made an advertisement at the foot of the pyramids, in Egypt. We took a sailboat up to the foot of the Matterhorn. All those crazy events. Then, what it does is, first of all, it projects the company as being very dynamic, disruptive, unusual. And, at the same time, people talk about it: “Did you see what the guy did? It was cows and edelweiss and camels in front of the pyramids or a sailboat at the foot of the Matterhorn!” People talk about things like that. So you can stretch it for quite a while. And especially, also, I always invited my retailers — the network — to these events, because I wanted them to be part of it. And very often, we didn’t just invite the owners, but the sales personnel because suddenly, the sales personnel was there at the launch with the owner of the company — with Michel Jordi. They could talk to him. You know, you have to be very humble in these situations. We’re all the same. And the retail, if you want to sell something, it is a long chain. Many people are involved and important for a sale. And I always say, a chain is only as strong as its weakest link. And, if at the front of the sales point, the salesgirl, the salesman, doesn’t believe in your product, doesn’t propose your product, you’re not going to make any sales. So, that’s what I say. Then you advertise. The last ‘p’, as you mentioned before, is the point of sale. If when you advertise, you cannot have a really optimal presentation, your product doesn’t stand out on the point of sale. You’re not going to sell it.

[00:32:29.23] Ben: And I suppose this idea of hacking — we might call it hacks or guerilla marketing — it’s actually become probably more, not less important, right? Because we’re all on our devices, we’re all even more distracted than we were in the past. So, it’s even harder to get on to the consumer’s radar because the consumer is more attention-deprived than ever. So I think the lessons in here are, you know, it’s not like because you were launching watches in the ’80s that these lessons are not applicable today. I would say they’re even more applicable today. And the other thing I liked a lot when you were talking about marketing was the importance of price on the one hand, but the other thing was packaging.

in my age, it was a shame to fail. It was a real shame. People looked down on you […] I mean, I failed four times. So what? Give yourself a chance to fail because, as I said, the most important thing when you fail is that you learn a lesson every time. — Michel JORDI

Michel: The packaging is very important. The first contact your customer has with your product it’s the packaging. First of all, you have to stand out! Of course, I mean, I’m lucky. I mean, I’m a Swiss citizen. What are the Swiss colors? It’s red and white. And red is the color of passion. Red was always involved in my packaging and everything. So red stands out. My books are red.

[00:33:39.15] Ben: Yes, that’s true! And also, for the Ethno watch, timing, again, was very important because you timed the watch to coincide with Swiss anniversary, right?

Michel: Yeah. Again, it’s part of the lucky clover — the first four commandments — as I said, vision, guts, differentiation. If you’re not different, if you don’t have a USP or a competitive advantage, you don’t stand a chance. And then, the last of these four is timing. And I realized that all these companies, which have been very successful, the timing was just perfect. And there’s a market research by American Venture Capital Group who revealed that 42% of startups fail because of bad timing. And I must say, sometimes it takes a portion of luck. I mean, the Swiss Ethno watch, without the 700 years anniversary, will probably not have been as successful as it was. Because we got a lot of write-ups from the press because we linked it with this 700 year anniversary. And if I come back to Le Clip: Le Clip was because I could jump on the bandwagon of the Swatch watch. And then, the Twins Heritage — I mean, imagine, my third watch, the Twins Heritage. I made Le Clip 50 Swiss francs. The Swiss Ethno watch, gold plate — 395. And then, after that, I come with the Twins Heritage — the price is ranged from between 70,000 to 220,000 Swiss francs for watches. When you go to any university, any business school, they just tell you, “This is simply impossible. You cannot, with the same brand, Michel Jordi — Le Clip was different — but from 395 you go up to 70,000 or 200,000!” Everybody said it’s impossible. And that’s what the press told me: “You’re crazy! It’s simply impossible. You’ll not be able to do it!” You know what? We made a fantastic launch event, with a great write-up in the Tribune de Geneve, production for Twins Heritage was booked out for a whole year within only two weeks after the launch. And we sold over 4 million Swiss francs of watches, in the first year. It was amazing! And because it was, again, something different.

[00:36:12.06] Ben: I just want to get back to the idea of guts, which is one of the four parts of the lucky clover. How do you rank guts? Because clearly, you’ve shown massive guts, putting a 10,000 order for Swiss Ethno before you’d even had a single retailer prepared to take it. It shows massive bravery. But, how do you rate guts out of 10? Because I can see how you could see what’s in the market and you get a sense for, this is 10 out of 10 differentiated. I can see how you can look at the timing and say, “Okay, there’s something I can hang this on.” There’s some market change or some technological change, and that’s the perfect timing. I can see how the vision you could rank it out of 10. How do you rank guts out of 10?

Michel: Well, I guess everybody has his own way of measuring his guts’ capacity or whatever. I mean, I just kind of developed it. Somehow I developed this and that was always very daring. I mean, guts is daring courage, risk-taker. I mean, guts has a lot to do with risk-taker. I took a hell of a lot of risks in my life. It also failed sometimes. I mean, that’s why I’ve fallen on my nose. But the good thing about guts, it’s like when you eat: sometimes you bite up a little bit too much than you can chew. So, you have to work your way through, to be able to chew it down and digest it. It’s the same thing with guts. Sometimes, you maybe took a bite a little bit too big. But it forces you to find solutions. You just have to go because giving up is no option. My book, actually, the autobiography, the English title, actually, is “Guts” and the subtitle “Giving up is no Option.” That’s the only thing, just guts. I envision things, I fix myself objectives. And then, of course, you have to weigh “How far can I go? How much can I bite up and hope to be able to digest?” And then you just have to run for it. You just have to work. It’s very, very hard work. And you just don’t give up. There’s no choice.

the best product in the world is of no use if people don’t know that it exists and where to buy it and why should you buy it — Michel JORDI

[00:38:36.20] Ben: Yeah. And another part of the book is where you were interviewed, and somebody said, “Well, what’s your plan B?” And you laughed, and you said, “There is no plan B”. So it’s gut almost like a proxy for just how committed you are to this?

Michel: That’s a very, very, very good question. As you say, correctly, this TV presenter asked me, “What’s your plan B for when you start your new company?” No. Commitment is 200% and you never think about the plan B, when you start. It’s impossible. That means you have two business plans. You have, “This is what I want to achieve” and “This is what I do when it fails.” That means that you plan to fail there in the first two weeks or the first two months. Forget it! Then you’d better don’t start. I mean, when you launch something, you plan to be there at least for a year or two or more. And since the markets are moving so much in six months, once you choose this, the market will be so different, everything’s so different than when you started out, that you cannot foresee what will be your plan B by then. So, just focus and concentrate on your success and make it happen.

[00:39:53.09] Ben: In the book, you point out that the pace of change is accelerating all the time, which is, I suppose, a good and a bad thing, right? Because more and more opportunities are opening up for entrepreneurs. And then, you say that also, that it’s become cheaper and cheaper to launch startups because the barriers to entry, the tech costs of creating a startup are falling. So, is your advice now, still the same as it was — i.e. create a business plan, have massive conviction, do the research, understand if it’s differentiated? Or is it more trial and error, now, because there’s so much change, to do more startups, to try more things?

Michel: Of course. Of course. I mean, time is now! I mean, your time is now. Of course, the thing is, you cannot stop progress, and we cannot stop where we are moving now. But I think every era, every period has its pros and cons and its advantages. I would say, today it’s so much easier to start a company, than in my time. First of all, in my time, it was almost impossible to find the money. We didn’t have the same technology. We had no computers, we had no iPhones, we had nothing. No smartphones. Today, all the tools are there. They are at your disposal. And also, I mean, in my age, it was a shame to fail. It was a real shame. I mean, people looked down on you, “Look at this guy! He failed!” I mean, I failed four times. So what? I mean, give yourself a chance to fail because, as I said, the most important thing when you fail is that you learn a lesson every time you fall. And, as I said, without Le Clip, I could never have done the Swiss Ethno watch; and without the Swiss Ethno watch, I could not have done the Twins Heritage. Everything became an evolution and was a fantastic learning curve. And what I can say, also, in hindsight, I don’t regret anything. I had a fantastic life. I enjoyed myself. I never looked at my watch. I never felt that I was working. Yeah, as a watchmaker, I never looked at my watch.

Ben: Yeah, as you say, it’s an irony.

Michel: I really had fun. I just lived my passion — and I think that’s the most important thing: people living their passion. I mean, life is so short and it gives so many opportunities. And also, when I mentioned the event marketing and all that stuff — today, things have not changed. Event marketing is still there. But it’s different because today you have the social media. With social media, you can make so much noise! You have Instagram, you have Facebook, you have all these things. We didn’t have that. So, the enormous opportunities and the advice I could give to young entrepreneurs who want to start their own business, start as early as possible. Start in your teens. The greatest thing to teens — 13 to 19 — because maybe you’re still in school, but you have peers, you have colleagues. You have no responsibility, no family responsibility, you have no kids. And it gives you a chance at 19 or 20 — you can fail two, three times and you’re still young to make it to the next point. And every time, you learn something, until you finally hit the jackpot!

in all of my companies, the most important for me was to surround myself with competent people — Michel JORDI

[00:43:31.13] Ben: I think this is, again, a really salient point, which is, you talk in the book about always being curious, always learning — which I’d say is, again, universally applicable probably more important now than ever, right? You know, you talked about your father’s life, this sort of rigid eight to five type setup and you wanting to do something different and be your own boss, and so on. But actually, almost like the option to have that rigid corporate life is disappearing, right? Because I mean, there aren’t so many jobs that you can do for your whole life anymore, right? So, it’s almost like more of a need to become entrepreneurs through necessity than was the case before. And one of your definitions of an entrepreneur is somebody who’s just constantly curious and constantly learning. Do you think you can teach that? Or do you think that’s just something that’s inherent intrinsic to individuals?

Michel: I think everybody has the ability to cultivate it. It’s an attitude. It’s an attitude to be curious. I mean, I’m so curious. I always ask a lot of questions. I want to know more, and I never take no for an answer. I want to know what is behind. And I think today, for the kids, they just have to be alert. Be alert. Eyes open, ears open all the time! And learn. Because, in the end, what is important is know-how. Through all the experiences we do, we learn a lot of things — which today we call know-how. And know-how is maybe one of the few things you don’t learn at the business school or universities. You only learn it by doing. So do it. Break your neck. Stand up and try the next thing. You know, without failure, there will never be any progress. You have to understand that. You know, the Wright brothers, the people who started to fly — how long did it take until you could fly an airplane? How long did it take until you could lift up and fly? How many people died? I mean, unfortunately, it’s the same thing, but the damages are not the same because you don’t lose your life. Those pioneers lost their lives.

[00:45:57.06] Ben: Yeah. Maybe we should talk about one of the things that didn’t work for you, which was the Swiss Icon. What was the reason it didn’t work, from an approach point of view? Did you apply the same methodology, the business plan, etc. to that business? Or was that one where you knew it was riskier because it didn’t score so well on the lucky clover? Talk to us about that.

Michel: It’s the perfect example. And I think it really rounds up my book because if I look at that lucky clover, at least two out of the four leaves were not optimal. The number one was timing — it was the worst time.

Ben: If you could just elaborate on that.

Michel: We launched it in August 2011. It was exactly when the Euro collapsed and so did the Swiss francs. And suddenly, you could buy Swiss watches cheaper in London or Paris or anywhere in the world, because the drop was over 20%. It was unbelievable! That was, even, at that point in time was almost par: one euro for one Swiss franc, for a couple of weeks. And so, of course, everybody stopped buying. I started to sell only on the Swiss market, concentrate on the Swiss market. So, time was definitely very bad.

Michel: Another thing was differentiation. It was a beautiful product. This is a beautiful product, I have it on my wrist every day, but it was not as different as all my other products. And when it is not that different, then what you need is you need very, very heavy advertising. You need a hell of a lot of advertising. And what we did, I had two partners in that company. So, what we did when the Swiss franc collapsed, we cut our advertising expenditure. Huge! We just crossed and stopped everything. And that was the first big mistake. And what we should have done is, if you cut the advertising budget, you should also reduce the price because suddenly that price — 7900 for a chronograph would only be paid if you advertised strongly so people would want to have it. But if you reduce your communication budget, your price should also come down, your retail. So maybe we should have sold it at 4900 or whatever, 3900. We didn’t do that. So it was definitely a mistake, a misjudgment, or whatever. But as I said, I also had two partners. I couldn’t do everything. I mean, the launch wasn’t the way I wanted to. And then came my bicycle accident where I lost consciousness and I had three broken ribs and things were going to get very, very difficult and more complex. And I decided, in the end, to sell the company to the partners and get out of it.

[00:49:08.10] Ben: So, was one of your learnings that when you’re launching a disruptive product, the advertising budget should never be seen as discretionary? Because it’s just trying to do something really disruptive — without the air cover of a big marketing budget is Canute-like, impossible to do.

Michel: Absolutely! You have marketing expenses — they are very, very important. You have to communicate, because the best product in the world is of no use if people don’t know that it exists and where to buy it and why should you buy it. Of course, I mean, there’s several ways of marketing. Also, what’s important is, I always try to first have trendsetters to wear your product because when you have trendsetters to go around and talk about you, it’s visibility. You need a lot of visibility. And you can only get that visibility when it’s the thing to have, which means you have to communicate.

[00:50:07.04] Ben: I would say that that trendsetter part is more important now than ever, also, right? Because we live in a world where branding is so tied to individuals. So yeah, having influencers wear your stuff. And when you were getting trendsetters to wear your stuff, did you pay for that? Or you just created a product that was so desirable that people wanted to wear it?

Michel: No we didn’t pay for it.

Ben: That’s what I expected, yeah.

Michel: But it was just so good, people bought it to have it. But we made it sexy. You have to communicate it in a sexy way and you have to package it properly. I mean, in the end, the product almost has to sell by itself. When you take it in your hand, there’s an emotion going through your body. You feel it. That’s the difference when you’re wearing a Swiss watch. A Swiss watch has a soul. If I buy a watch made in Japan or Korea or China, there’s no soul in it. It also gives the time, but it is no soul on it. I mean, the Swatch watch at 50 Swiss francs I think it’s the greatest consumer product ever made. Ever made. Because at that time, the watch was 50 Swiss francs. What other consumer product gives you technology, precision, mechanics, time, and lifestyle, for 50 bucks? It’s amazing! I think it’s a great product still today!

[00:51:42.02] Ben: Why do you say that Swiss watches have a soul in a way that other countries watches don’t have a soul?

Michel: The way we communicate it, the way we market it.

Ben: Yeah, because I think one of the things that Switzerland does brilliantly is packaging, right?

Michel: And communication. It’s communication. I mean, most big companies, they have a great slogan around. Look at the Rolex advertisement — it’s amazing!

[00:52:08.07] Ben: So, I just want to get you in a couple of other things that you talked about in the book. There’s a really nice soundbite where you say ‘talent wins games, but teamwork wins championships.’ Can you talk to us about the importance of building great teams and how you cultivate those teams?

Michel: I think it’s essential for every company to have a great team. And that’s exactly the slogan you just said: a team wins championships because, if you compare it with an army, there’s no use to be a general when the troops cannot follow you. Napoleon could never have won if the troops were not right behind him. And in all of my companies, the most important for me was to surround myself with competent people. You can read about them; I get a lot of testimonials in my book here. One of my guys is now CEO at Rolex Australia, another one is CEO at Bucherer in Lucerne, about 10 of them have started their own company. I have regular contact with them and they always tell me, “Michel, without you, I would have never been there.”

[00:53:26.12] Ben: So there’s two functions there. One is spotting raw talent. How did you do that?

It’s beneficial for the company to take a vacation, to take off. And this is what I think we have to understand. You cannot perform when you’re tired. Enjoy life! — Michel JORDI

Michel: Empowered them. Empowering people.

[00:53:37.17] Ben: But empowering people presupposes that they’re good in the first place. So how did you spot the great people? And then we can talk about how you empower them.

Michel: You know what? It is very fun and very interesting: I believe that a lot of people have much more talent and are much more capable than they think. But you have to give them the confidence. You have to detect and see where the strength is and let them go, let them loose. You know, I realized, when you let them loose or ask for them big things to do, it’s very motivating. Because they’re like, “My boss has confidence in me! He thinks I can do that!” I mean, the one who is now in Australia, the Rolex CEO, he was a watchmaker repairing watches at a retail shop in Zurich, and he was about 22 years old or 23. I said, “What are you doing here?” I mean, you know, as a watchmaker at his age, I saw that guy had potential. And I wanted to have salesmen going out to sell my watches, who know what they talk about — watchmakers. So I took him, I trained him on the Swiss market, then I sent him with my best salesman internationally, to the Middle East to learn about the international salesman. Then I told him, “Now you’ll go to Hong Kong and you’ll open my affiliate office in Hong Kong.” He opened my affiliated office in Hong Kong, and then made a business plan. We showed him how to do it. And the guy, he was 26 years old, he was trembling. He said, “Can I do it?” I said, “You will do it! Just go!” Throw them into the water, give them a chance to maybe make mistakes. But you learn from the mistakes. Again, they learn to swim.

[00:55:28.19] Ben: The impression I get when I listen to you is not only were you very much part of the renaissance of the Swiss watch industry, but also to the longevity of that Renaissance because of all the people that you coached and all the people to whom you gave opportunities? Would you say that’s fair? I know you’re a modest man.

Michel: I’m a very, very small part of that. And in the end, it’s still the guys who have to do the job. But if we come back to Bucherer, now the guy who is CEO, his second man below is also a guy from me because he was looking for a number two man. And I had him, he was a guy who worked in another company, in the Twins Heritage. So now Bucherer’s number one and number two, both come from my team. So these guys, once you give them the opportunity, they have to see their opportunity. They have to grab it. But very often, I think a coach’s job is to detect the ability, the talent and give them the confidence to really develop all their potential. Very often, they don’t even know what they’re capable of. So, develop that potential.

[00:56:48.11] Ben: The confidence and the opportunity, right? Because you did both, right?

Michel: Yeah. See it, have your eyes and ears open.

[00:56:56.03] Ben: And then what about leadership? Because it seems like you’re the sort of leader who leads by example, right?

Michel: This is leadership. Show them the example. Exactly. I mean, for example, you know, most of the time, I was the first guy in the office. Most of the time I was the guy who closed the door. You have to show them how to do it. Get your fingers dirty yourself.

[00:57:21.27] Ben: But having said that, you also talk about the importance of work-life balance in the book.

Michel: Yeah.

Ben: So, live by example, show the level of commitment to the business, but at the same time… Or would you say also lead by demonstrating to people the importance of not burning out, of pacing yourself off, as you say, eating well, living well, exercising.

Michel: I never had anybody in my company who had to burn out. But I must admit that I have been close to burnouts a couple of times. One of them was at Le Clip. I remember I arrived once in Vancouver on a Friday night and I stayed in bed the whole weekend and on Monday I traveled on to Japan, to Tokyo. I didn’t see anything of Vancouver except the airport. I was just so completely tired. So you have to listen also to your body. When you’re down, you’re down, then you have to rest. And what I learned over time is that when I grew up, you were a hero, and you wanted to show that you work hard and you work long hours. Today, I realize — that’s what I’m also trying to tell people is that the art of doing a good job is of knowing when to relax and when to slow down. So, I started to take long weekends, and that’s what I could suggest to anybody. A long weekend, let’s say three, four days, when you’re in the 30s or 40s. I mean, it can do wonders in regenerating yourself. Or take a week vacation — whatever — because when you come back, your mind is emptied, you know, and you have just so much energy. And it’s only good for the company. It’s beneficial for the company to take a vacation, to take off. And this is what I think we have to understand. You cannot perform when you’re tired. Enjoy life! That’s all I can say. I love to drink a good glass of wine. You work like hell during the day and in the evening, a good glass of wine — hey, what a pleasure! What a relaxation!

[00:59:31.07] Ben: Talk to us about why you ended up calling it a day when you realized that you didn’t want to do any more startups — and the conditions that then gave rise to you writing this autobiography, which sadly, is only available in German, right? At some point, maybe you’ll publish the English version. So, talk to us about that realization that enough is enough. It was now time to take a step back.

Coaches are so important, because, as I said, a lot of people lack the confidence. They don’t see all their potential and that’s what a coach is for. And I think, if I can help people detect their potential and live also, as I said before, a balanced and a rewarding life, then I think it’s a fantastic way to end the fourth part of my life. — Michel JORDI

Michel: Like I said, the lucky clover has four parts. Our life has different segments. There’s our youth, there’s education, then you start to get into the corporate drive, then you become independent as me, but then, I’m 70 years old now. I mean, you have to think how much longer you have to live? It’s 10 or 20 years if I’m very lucky, if God wanted. So, what do I do with the rest of my life? And I think the rest of my life is not going to be behind the desk and doing operations stuff. But coaching people, or consulting companies, detect talents or detecting opportunities. Coaches are so important, because, as I said, a lot of people lack the confidence. They don’t see all their potential and that’s what a coach is for. And I think, if I can help people detect their potential and live also, as I said before, a balanced and a rewarding life, then I think it’s a fantastic way to end the fourth part of my life. First of all, life is not a 100-meter dash. Life is a marathon. And it’s not like a football game where you have two halves. I think it’s more like basketball where you have four quarters or something like this. So I’m maybe a man now in my fourth quarter. And I think there’s still a hell of a lot to do and I’m looking forward to it.

[01:01:40.20] Ben: Fantastic! That’s a wonderful optimistic note on which to finish the podcast. So Michel, thank you so much for coming. Buy the book — Ignite That Spark — it’s full of sage advice, and it’s really a great read. You can read it in a single sitting. I think it’s also a reference — you can keep coming back to it.

Michel: Yeah, it’s like a Bible. You can take it back anytime. But also, what I said is, the book costs 19 Swiss francs — roughly $20. What I say to everybody who buys my book is that if you don’t get 20 bucks value or wisdom out of this, write to me, and I refund it.

Ben: You get your money back, guaranteed, from the man himself. Okay. Thank you so much again, Michel!

Michel: Thank you! It was great!

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