Richard Bran­son

How I can win the trust of in­vestors, fu­ture part­ners and sup­pli­ers?

Catali­na Ly,

En­tre­pre­neur mag­a­zine read­er

This is part of a larg­er ques­tion: What's your most valu­able pos­ses­sion? When peo­ple ask me that, they of­ten ex­pect me to name some ex­pen­sive ar­ti­fact. How­ev­er, my most valu­able pos­ses­sion is al­so my most val­ued pos­ses­sion. It costs noth­ing, and every­one has one: my rep­u­ta­tion.

"I don't give a damn 'bout my bad rep­u­ta­tion!" Joan Jett sang in her clas­sic hit sin­gle. It's a great song, but I dis­agree.

For en­tre­pre­neurs, a bad per­son­al rep­u­ta­tion will ex­tend to your brand's rep­u­ta­tion as well. If you do any­thing to dam­age ei­ther your own rep­u­ta­tion or your com­pa­ny's, you could de­stroy your busi­ness. When you make a promise to your cus­tomers, you need to walk the walk. While a good rep­u­ta­tion pre­cedes you, a bad rep­u­ta­tion will fol­low you for a long time; it takes years to build a strong rap­port with peo­ple and just sec­onds to lose it. Those in your in­dus­try, from po­ten­tial in­vestors to sup­pli­ers to prospec­tive em­ploy­ees, will take note.

When we start­ed our brand, the Vir­gin name was per­ceived as so risque that we weren't al­lowed to reg­is­ter it with the British Patent Of­fice for three years, be­cause the of­fi­cials there thought it was rude. My per­son­al rep­u­ta­tion for stand­ing out from the crowd of or­di­nary, stuffy busi­ness­man helped, too. As a young, long-haired en­tre­pre­neur in the 1970s, I got some fun­ny looks when I went in­to the bank bare­foot the first few times. But af­ter a few years, if I sud­den­ly turned up at the bank wear­ing a suit and tie, they knew some­thing was up!

Soon, our move from punk rock to avi­a­tion–Vir­gin Mu­sic to Vir­gin At­lantic–en­hanced our rep­u­ta­tion as risk-tak­ers and in­no­va­tors, giv­ing us a com­pet­i­tive ad­van­tage over oth­er com­pa­nies. This came in handy: Vir­gin be­came known as the brand that could go in­to sec­tors with trou­ble­some rep­u­ta­tions and shake them up by ap­ply­ing our val­ues.

When we bought our first plane, air trav­el was con­sid­ered very ex­pen­sive, ex­treme­ly frus­trat­ing and aw­ful­ly dull; more re­cent­ly, the bank­ing sec­tor has been held part­ly re­spon­si­ble for the re­cent fi­nan­cial cri­sis and glob­al re­ces­sion, so we used our rep­u­ta­tion to in­stil some trust and, as Vir­gin Mon­ey's slo­gan says, "make every­one bet­ter off," as we ex­pand­ed the com­pa­ny from cred­it cards in­to bank­ing.

Brand rep­u­ta­tion

The world is be­com­ing ever small­er, and thus main­tain­ing your brand's rep­u­ta­tion is more im­por­tant than ever. These days the Vir­gin brand is trust­ed glob­al­ly, so if we set up a ven­ture in a new coun­try, progress is swifter than in the days when we had to win over cus­tomers one trans­ac­tion at a time. But im­proved com­mu­ni­ca­tions al­so mean that any neg­a­tive sto­ry about a Vir­gin com­pa­ny any­where can be­come a glob­al event with the click of a mouse.

As an en­tre­pre­neur, you need to keep a close eye on all the chat­ter about your busi­ness on so­cial me­dia chan­nels and on­line: Twit­ter, Face­book, and all their com­peti­tors. This doesn't mean mi­cro-man­ag­ing and tread­ing on your em­ploy­ees' toes, or at­tempt­ing to stop cus­tomers from ex­press­ing their opin­ions about your brand. Rather, to build your com­pa­ny's rep­u­ta­tion on­line, you need to hire peo­ple you can trust not on­ly to ex­cel in their day-to-day jobs, but to be the pub­lic faces of your busi­ness. Af­ter all, a brand is on­ly as strong as its peo­ple.

Every­one makes mis­takes. If you or some­one in your com­pa­ny does, it is im­por­tant to own up to it and move on. Some­times the CEO must step in per­son­al­ly. For ex­am­ple, when a mar­ket­ing agency hired by an Amer­i­can com­pa­ny Vir­gin is as­so­ci­at­ed with went too far re­cent­ly in an ad, I took to Twit­ter and my blog to apol­o­gise for any of­fense this caused.

In terms of their per­son­al con­duct, some en­tre­pre­neurs launch­ing their first star­tups may try to mim­ic the stereo­type of the tough busi­ness­man and bul­ly who gets his way. I don't think that this leads to last­ing suc­cess. You need to treat peo­ple as you would wish to be treat­ed in or­der to gain re­spect. If you de­vel­op a com­pa­ny cul­ture based on mu­tu­al un­der­stand­ing and re­spect, your em­ploy­ees are more like­ly to en­joy their jobs and be­come am­bas­sadors for your brand and rep­u­ta­tion. Like­wise, cus­tomers will put their trust in your com­pa­ny and pur­chase more of your prod­ucts; in­vestors and po­ten­tial part­ners will con­sid­er your pro­pos­als se­ri­ous­ly; and ven­dors will want your busi­ness.

One of my over­all points in writ­ing this col­umn is that build­ing a busi­ness is not rock­et sci­ence; it's about hav­ing an idea and see­ing it through with in­tegri­ty. This ba­sic for­mu­la means that as an en­tre­pre­neur or busi­ness leader, you can't com­pro­mise on your prin­ci­ples when deal­ing with your staff, your cus­tomers, your sup­pli­ers, or any­one else con­nect­ed with your busi­ness. Be­cause if you treat peo­ple fair­ly and well, they will re­ward you with loy­al­ty and ded­i­ca­tion. If you fail to do so, the reper­cus­sions will fol­low, and even­tu­al­ly im­pact your bot­tom line.

(Richard Bran­son is the founder of the Vir­gin Group and com­pa­nies such as Vir­gin At­lantic, Vir­gin Amer­i­ca, Vir­gin Mo­bile and Vir­gin Ac­tive. He has re­cent­ly pub­lished two books: Screw Busi­ness as Usu­al and Like a Vir­gin. He main­tains a blog at www.vir­gin.com/richard-bran­son/blog. You can fol­low him on Twit­ter at twit­ter.com/richard­bran­son. To learn more about the Vir­gin Group: www.vir­gin.com.)

(Ques­tions from read­ers will be an­swered in fu­ture columns. Please send them to Richard.Bran­son@)ny­times.com. Please in­clude your name, coun­try, e-mail ad­dress and the name of the web­site or pub­li­ca­tion where you read the col­umn.)

@2013 Richard Bran­son. (Dis­trib­uted by the New York Times Syn­di­cate.)