Elliot Moss
That was Boom Boom from John Lee Hooker. Thank you very much for joining me, Elliot Moss, here on Jazz FM with Jazz Shapers. The place where you can hear the very best of the people who are shaping the world of jazz, soul and blues alongside their equivalents in the world of business. My business shaper today is Angela Farrugia, and she is the co-founder of TLC, the licensing company which is a brand licensing business which has just had a rather remarkable event too earlier this year. You will be hearing lots from her very shortly. In addition to hearing from her, you will also be hearing from our programme partners at Mishcon de Reya some words of advice for your business and as well as all of that of course some brilliant music from the shapers of jazz, soul and blues, including Takuya Kuroda, Jamie Cullum and this from Dionne Warwick here on Jazz FM.
That was I will Never Fall In Love Again from Dionne Warwick here on Jazz FM and thank you very much for joining me again for another edition of Jazz Shapers. My business shaper as billed earlier is Angela Farrugia. She is the co-founder of TLC or The Licensing Company as its full name. It’s a brand licensing business which if you don’t know; she is now going to tell you what it actually does. Thank you very much for joining me Angela. What does TLC actually do?
Angela Farrugia
Okay, hi Elliot. Just to give you a little bit of an inside track without becoming too technical. We are kind of the secret ingredient behind a lot of big brands and their expansion into other product areas outside of where they truly make their money. So for instance, Coca-Cola. Obviously everybody knows Coca-Cola for producing soft drinks but we actually create all of their products, their fashion, their hard goods, whatever it may be around the brand. So anything you see that has got Coca-Cola on it, that’s not a soft drink, has come through our business.
Elliot Moss
Now just to put this in context. You are one of the largest in the world. One of the fastest growing companies over the last few years in this space. It’s billions of pounds or dollars of sales that you are actually helping your client’s generate in this area isn’t it?
Angela Farrugia
That’s correct. It is actually very sizeable these days. As of today our official number is 8.3 billion in retail sales every year. That number increased a lot earlier this year because of an alliance that we made with Li and Fung’s companies but TLC on its own for the last seventeen years has really been responsible for billions in creating retail sales beyond the reach of our core brands.
Elliot Moss
And we are going to talk about Li and Fung which is the company that actually bought you. The big event from becoming… being an independent to becoming part of an enormous entity.
Angela Farrugia
Absolutely.
Elliot Moss
So let’s just go back. Your first few jobs as it were before you set up your own business. You worked in the industry for a while?
Angela Farrugia
Well I was a retail buyer so I was buying for retail chains and running retail and I still view myself as a shop keeper so I actually, even these days, head retail development from around the world. I spend my time heavily with brand marketing directors or retail directors talking to them about brands they should form alliances with, those that are going to give them strategic benefits and so on and so forth. So that is where I am really happiest. I came into licensing by accident because I don’t think anyone sets out to have a career in licensing.
Elliot Moss
No and most people don’t know what is but they kind of enjoy the benefits of it.
Angela Farrugia
You fall into it and then you never leave because actually it…
Elliot Moss
They won’t let you go.
Angela Farrugia
…it is quite, it is one of those, you know, quite compelling industries and that was a very long time ago. I started at twenty two and started selling things like Teenage Mutant Hero Turtles and My Little Pony and from that we migrated to set up TLC seventeen years’ ago.
Elliot Moss
And hold that thought because I want to find out why you did it and why you thought you would be a great success in it. Time for some music, this is Jamie Cullum and Love For Sale.
That was Love For Sale from Jamie Cullum. Angela Farrugia is my business shaper today, she is the co-founder of The Licensing Company, they are the brand licensing people, the people that put things in your hands and make you buy stuff around the brands that you love in slightly different guises. All very cool stuff. Now I am going back to around the mid-90s. You had a very very big company, in a well-paid job my sources tell me reliably and you said ‘you know what’ and you I believe, Melvin.
Angela Farrugia
Melvin.
Elliot Moss
Your partner, your partner now, business partner now said ‘let’s go and do something ourselves’. Where did that come from? Over what period of time did you say ‘we’ve got to do something different’?
Angela Farrugia
Yeah I remember all of that so clearly. We were in a company, really enjoying what we did but we wanted to, we were very much in the kid space so dealing with kids entertainment properties and what we wanted to do was really drive a business that represented the best brands in the world and we couldn’t see anyone doing it so he is the other side of my brain. I am very much the creative and the we can do this and he tells me how to get there and from that point we basically wrote a business plan for TLC that even at that point seventeen years ago, I could have told you what it would have been like to work in our company and the kind of people and brands that we wanted to represent.
Elliot Moss
And what is that right now and what was it then? Those things?
Angela Farrugia
It’s, it’s a place really where the best brands in the world want to come and be housed and be represented. Kind of like walking into the best department store. You want to go in and think ‘yeah, there’s somebody who really gets it here, who really understands how to take care of my brand’ and create a strategy for extension that consumers are going to go ‘yeah I really really like seeing that’. But also the talent of people and the attitude, it is very fresh, it’s very dynamic. Melvin and I worked out very early on, get out of the way and let our talent come through in terms of our people and that has held us in really good stead from one office now to thirteen offices around the world.
Elliot Moss
And was it the sense of doing your own thing? Was it, we are just as you said, we are not seeing what it is that we want to see here, and we can do it? Because that must have been, there must have been some fear?
Angela Farrugia
Well I am a born risk taker and luckily…
Elliot Moss
So no fear?
Angela Farrugia
…well it’s not that it was no fear but we just had a very very strong resolve that we were good at what we could do and that there was a market waiting for us. Don’t ask me where that came from but it was an absolute insane confidence that drove us. Our business model is very, basically we don’t really earn any money for the first three years of whatever we do. We are unlike a PR company, we are unlike a marketing company.
Elliot Moss
No fees. It comes off the back of sales?
Angela Farrugia
It really does. You are on the sharpest end of the stick because your product has to work because we only generate revenues at that point.
Elliot Moss
So basically skinning the game from day one.
Angela Farrugia
Houses in the game.
Elliot Moss
Houses in the game. Everything in the game. We are going to come back to that.
Angela Farrugia
Oh yes.
Elliot Moss
And talk about how you managed those first three years. Latest travel first, that’s coming up in a couple of minutes and before that, some words of wisdom from our programme partners at Mishcon De Reya for your business.
You are listening to Jazz Shapers with me, Elliot Moss every Saturday morning you can catch me and a brilliant business shaper talking about what has driven them, where they are now and where they are going to go and shape their business in the future. If you have missed any of the previous fantastic guests, go into iTunes, put the words Jazz Shapers in; you’ll find us there. If you are travelling on British Airways any time soon you will also find us popping up over there and even FT.com and Cityam.com, everything is happening over here on Jazz Shapers. Angela Farrugia is my business shaper today and she is the co-founder of The Licensing Company, someone behind a business that is now part of another big business but many years ago for the first three years of its life had no cash flow which is where we were before you had some words of wisdom and some travel news. Tell me about those first three years? Cast your mind back. You’ve got no money, you’ve literally had to I imagine, just leverage your own assets? Your own houses?
Angela Farrugia
We did.
Elliot Moss
Nerve wracking.
Angela Farrugia
Yeah I mean we had, we had a third of our company with some external backers who believed in Melvin and I but the reality was that you have to make your own future and you have to do it quite quickly. So you know, you pull out every resource that is open to you. You leverage every piece of intelligence that you have and you know, hopefully you get to a better place but we built, we’ve had seventeen years of building reputation and doing the right thing for people and that’s held us in the best stead globally.
Elliot Moss
Your partnership with Melvin, obviously is the foundation of a lot of this. The two of you went into business, you are still in business, it sounds like you still talk to each other; which is good, though we don’t have to be too honest obviously if it is not going that way. I am only kidding of course. Going way back then though, that bedrock of partnership must have been at the core of what it was that enabled you to keep going?
Angela Farrugia
Yeah I mean, Melvin and I are… we’ve worked together for now twenty five years, we do have a work marriage and you know, we bicker like you expect us to but that actually keeps us both very very on track, it keeps us both challenged as well because he looks at things slightly differently to me and I look at them differently to him but somewhere in that there is a very big mutual respect, I mean for years he has negotiated my salary for me because I am very happy for him because we are so equal in our business, so we are probably one of those rare success stories of partnerships flourishing all the way through twenty five years of career.
Elliot Moss
And how would your team describe you and Melvin? What would they say about the way that the business has been run all the time?
Angela Farrugia
Our business and our biggest clients are all linked to one of us. Depending which side of the brain they really kind of respond to better, whether it be the creative and the retail visionary side of things or whether it be the operational and the logistics of things. So we actually split our responsibilities equally and our staff, I think they feel very secure in the fact that we are so solid as well and that we have led the company from the front.
Elliot Moss
You talked about, we mentioned those first three years, obviously it came through and it became good and we are still here talking about it. When you received that first big cheque as it were for the first three years of graft and it takes that time. What did that feel like? Do you remember the time you thought ‘you know what, this is going to be alright’ or did you always think it was going to be alright anyway?
Angela Farrugia
No I think that you know, even, I don’t know - I still wake up on days and think it could all go away. Last year we had a pretty big shock when we woke up and read in the paper that Disney had bought Lucasfilm and Lucasfilm is the owner of Star Wars. Now we had been Star Wars’ number one agency in the world outside of the US for fifteen years. I mean it was a cornerstone of our whole business and that pretty much went away overnight so that was a very bad day. So it can change. We are still an agency. I think we have got a lot of complexity around our business now so it is harder to walk away but those things can happen.
Elliot Moss
Stay with me to hear more from my business shaper, Angela Farrugia. Time for some music, this is Takuya Kuroda and Green and Gold.
That was Takuya Kuroda and Green and Gold. I have been speaking to Angela Farrugia about all sorts of things, especially the nature of partnership and the way that a business can grow if the partners are solid. In those dark times, you just mentioned a bad day, you said ‘oh you know, the Star Wars business disappears’ say a third of your business. Where do you go emotionally for support at those times apart from Melvin I am assuming?
Angela Farrugia
Yeah.
Elliot Moss
Who else do you go to and what do you look for?
Angela Farrugia
It’s, it’s, we’ve had several kind of body blows during the life of the company but every time I think you know, you dig very deep. I am a survivor, I am Maltese by nature and a Taurian and every single part of that comes to the fore when somebody is threatening our livelihoods basically and the livelihoods of the people that are working for us. So obviously we become creative and Melvin becomes even more structured and how we are going to go through this and we have every single time, even during the economic down turn, you have to understand our business is driven by retail sales. I was running our US office for six years when half the retailers we were dealing with disappeared and you just could not see the way for the business forward. That’s the time when you pull on your absolute survival strategies to get through and you can do that.
Elliot Moss
And the survival strategy is all very well and good for you as you said, the Maltese Taurian. That’s fine but what about the people behind you that aren’t from Malta? That aren’t Taurian? How do you ensure that those ten, twenty, thirty, forty, fifty, seventy, however many people there is now, more people now obviously working for the business around the world. How do you keep them strong?
Angela Farrugia
Well you communicate regularly. You tell them from your heart exactly what is going on as soon as you can and as soon as you have formulated some kind of really steadfast plan. In the US when our business was absolutely miniscule because of this down turn, I looked outwards and found a company called Iconics who I just wanted to see anyone else that was in business at this point, in our industry, that was doing well and what could I learn from it. We completed a joint venture with them pretty soon afterwards and it has transformed our business as well as a result of that learnng.
Elliot Moss
And you have continued to do that through the seventeen years. It sounds like not only do you toughen up but actually some people look internally and get introspective. It sounds like you go ‘what can I do next’, what’s going to help us transform the business?
Angela Farrugia
Absolutely.
Elliot Moss
Is that a fair point?
Angela Farrugia
I think you have choices, you know, of course the immediate situation looks dire but you re-group, you re-focus, you take your best people and you put your heads together. This is never a lone thing because everyone has always got ideas about what we can do and how we get through it and you come out fighting basically and stronger.
Elliot Moss
We will have our final chat with Angela plus play a track from shaper of jazz, Django Reinhardt, that’s after the latest traffic and travel here on Jazz FM.
That was Django Reinhardt and I’ve Got Rhythm. Just for a few more precious minutes Angela Farrugia is my business shaper and we have been talking about ups and downs and resilience and how your star sign can help you ensure that your business retains itself in a good form. Now the last year has been I suppose the biggest transformation or at least on paper, the biggest transformation because you sold your business to a big company, Hong Kong Stock Exchange based, enormous, billions and billions, one of these great beer moths that you’ve never heard of and then you hear about them and of course you can’t avoid hearing about them. It is one of those things. You were… were you seeking some kind of exit at some point in the life of the business or was it more we could do more with some more muscle? What was the driver?
Angela Farrugia
I think the driver is that we’ve always wanted to evolve the business and give better service to our brand owners and our clients so when you are in this industry that makes products happen, you know, you work with retailers actually an alliance with the sourcing element of that, the product sourcing side of things makes total sense and when Li and Fung, the company that actually acquired us in January approached us, it did make a lot of sense to us. They are a twenty billion dollar sourcing company, they supply many of the high street goods that you would see today, Sainsbury, Marks and Spencer, Tesco. They are multi-facetted in how they deal with the retail channel and yet at the heart of it, they don’t have a brand… they don’t have anyone thinking brand strategies so we are a very interesting marriage.
Elliot Moss
And in terms of obviously personally, you and the other shareholders would have made money which is nice. Does that make you feel any more worthwhile as a person or is it more, well that’s nice and it’s a bit of security and now I move on, I am on the next phase of the business? Because people react very differently, people are funny about money.
Angela Farrugia
Yeah. I think that you know, after seventeen years of building something there was a general recognition by people that you’ve done a good…
Elliot Moss
You’ve earnt it.
Angela Farrugia
…you never get a pat on the back when you are a business owner. You don’t really. You know, we are actually gone up thirty places in the Sunday Times Fast Track 100 which we can probably never enter again because we are not independent. We were listed last year as a Telegraph, one of a thousand companies to inspire Britain. Those things are the outward facing pats on the back. Actually this kind of alliance means you’ve done well. You’ve delivered something here. Not only for yourself but for your people because we all share our own successes.
Elliot Moss
And that future that we just touched on. What’s that going to look like for you and the business personally and professionally?
Angela Farrugia
We are now part of an extremely influential and quite I would say, very exciting business. It is led out of Hong Kong but they have three regional hubs which mirror our regional hubs now through Asia, the US and Europe and actually I went to the leadership conference in February with Melvin and we sat there thinking ‘oh wow’. This is like a whole new level of learning for us and we are being exposed to some significant thinking about how retails changing, Omni channel this you know, and how we can prepare ourselves for this new digital age and things like that so we thought it was a new day.
Elliot Moss
Well it sounds like the new day is a rather good day to. Just before I let you go, what’s your song choice and why have you chosen it?
Angela Farrugia
I am actually going to go for Louis Armstrong and What A Wonderful World and I think it just sums up every single day of our lives at TLC.
Elliot Moss
She’s a happy person is Angela Farrugia. Thank you very much for being my business shaper, this is your choice, it is Louis Armstrong and What A Wonderful World.
That was What A Wonderful World from Louis Armstrong, the song choice of my business shaper, Angela Farrugia. A woman with confidence, someone who believes she could set up her own business and make a success of it. A resilient person, someone who through those bad times kept on going and crucially somebody who wants to learn every day that they wake up and face the world of business. Do join me again, same time, same place, that’s 9.00 o’clock next Saturday here on Jazz FM for another edition of Jazz Shapers. In the meantime though do stay with us, coming up next it’s Nigel Williams.