I am not a person who looks back on my life with regret. I have always followed the motto: life is best lived looking forward and looking up. This week, however, the sale of Virgin America to Alaska Airlines has made me reflect on the occasions when we sold Virgin companies and then what we did after. At heart we’re entrepreneurs and we like to grow new companies, so instead of sitting back on our proceeds we used that Virgin spirit, the new cash and our people to start new ventures and grow the Virgin brand.
Looking back, the most painful, before Virgin America, was the sale of Virgin Records in 1992. It was the bedrock on which the Virgin Group had been created and like Virgin Atlantic and later Virgin America, it had been built to take on the established players. It had a great roster of bands at the time and we were the label that artists wanted to sign for, including The Rolling Stones, Genesis and many more.
In the early 1990s, while our music business flourished we needed cash to fund Virgin Atlantic, which was battling against British Airways’ Dirty Tricks campaign. Our rival Thorn EMI offered us a lifeline with a strong bid for the label and with great regret I sold the company for $1 billion and was then seen running down Ladbroke Grove with tears streaming down my face.
I was devastated to say goodbye to the people who had built the Virgin label but I also knew that we desperately needed money to expand Virgin Atlantic and be able to compete. Almost 25 years later, Virgin Atlantic is thriving again, and the funds we generated from the sale helped kick start its growth as well as a number of successful new initiatives (and some less successful ones!) Meanwhile, EMI and now Universal kept the Virgin Records brand alive to great effect and it has been named the UK’s number one singles company and the number one albums company for three years running, proving there is life in a 40+ year-old brand.
In 1999 we were approached by Singapore Airlines to buy a 49 per cent stake in Virgin Atlantic. Crucially we kept control and the £600m we gained from the sale gave us cash to fund the early stages of Virgin Active, the expansion of Virgin Money and the creation of the first Virgin Mobile business.
Two years later, however, we were forced to sell assets, as the impacts of the 9/11 attacks ripped the heart out of the airline industry. We sold the majority of Virgin Active as well as my beloved hotel Le Residencia in Mallorca. I still visit the hotel and just recently bought another large plot on the Mallorca coast, Son Bunyola, to recreate the magical feel that La Residencia had in the early days. In this case the money was much needed to fund the airline but we still found partners to expand our fledgling Australian airline, grow our health clubs in South Africa and Europe and our mobile businesses further afield.
NTL approached us to merge with Virgin Mobile in 2006 and rebrand the combined company as Virgin Media. As soon as this deal was completed, our team worked closely to build relationships with the buyer and ensure the culture lived on at the newly named Virgin Media. When Virgin Media was sold to Liberty Global in 2014 we had been able to establish a good rapport and recently expanded our partnership with Virgin Media to include Ireland.
Indeed, the last 15 years has seen us create and then expand many Virgin businesses from health care to health clubs and from cruise ships to space ships. A restless energy and curiosity have played a great role in regenerating and helping to revive the Virgin brand – keeping it relevant and engaging.
On the only occasion where the brand was not used, the new owner did not do well. Virgin Radio was bought and immediately rebranded Absolute Radio, but it struggled to keep and build an audience. Reports show it lost one fifth of its audience in the first three months and went on to lose half of its audience, leaving the market open for us to return with the Virgin brand. That we did last week, when we launched a new Virgin Radio UK to win back the audience.
Alaska Airlines says it recognises the power of our brand and wants to research its past successes and future potential. Looking up, you never know if in 25 years’ time - just like Virgin Records – we may be enjoying an ongoing revival. Here is to Virgin America still playing for years to come – and to growing many more Virgin companies that disrupt stodgy industries and deliver exceptional customer service around the globe.