Tuesday 27 September 2016

Eddie Jordan: 'I've made losses... I'd hate to tell you how many'

Formula One has become too corporate, but serial investor Eddie Jordan is no stranger to taking corners at high speed. He spoke to John Reynolds

John Reynolds

Published 29/05/2016 | 02:30

‘If you make a profit, it’s good to reinvest it,’ says Top Gear’s Eddie Jordan. Photo: BBC World Wide
‘If you make a profit, it’s good to reinvest it,’ says Top Gear’s Eddie Jordan. Photo: BBC World Wide

Before he began presenting Formula One on the BBC some years ago, Dubliner Eddie Jordan - the founder of the Jordan Formula One team and perhaps the motor-mouth of motor racing - was advised by a broadcasting tutor to try to speak more slowly on camera.

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He's a man for whom the word 'driven' applies - in both senses. Speaking animatedly at times (with a few impatient roars at me for good measure, to hurry me up), he's on the phone from his home in Monaco, ostensibly because he's one of the presenters of the new series of Top Gear that begins on the BBC this evening, but also to talk about Formula One and a few of his current business interests.

He owns a small upmarket publishing house, Debrett's, which its management team runs for him, and is on the board of a London hedge fund Clareville Capital. He also owns a small stake in Valeo Foods, which bought biscuit maker Jacob's in 2011, and reveals he has invested in a $1.2bn New York skyscraper, 432 Park Avenue, currently being built.

"I was attracted to Valeo by Jacob's amazing brand and business, and generally I always made money in property," he says.

Through Citi Private Bank, he was part of a group that invested over €400m into the New York Tower - the tallest residential one this side of the planet - where apartments cost between $17m and $95m, with total sales expected to hit $3bn.

His career began as a bank clerk with Bank of Ireland in Mullingar and then Dublin - though his autobiography An Independent Man reveals he had a wheeler-dealer entrepreneurial mindset early on in life, trading in conkers and marbles in the school playground, then seeing an opportunity to buy and sell schoolbooks.

He progressed to second-hand cars, buying from friends in motorbike racing circles - he competed at weekends - and selling through newspaper ads or even to customers of the bank who were applying for car loans.

He's not sure exactly where his entrepreneurial genes originate from. At one stage his parents wanted him to be a priest or a dentist. He was closest to his mother, who ran the household, he says.

"I probably took a lot from her. I was driven. Wanting to make money was part of it, of course, but not the sole aim. It was more about doing a deal - setting it up and seeing it through. If you buy something really well enough, you should always make a profit. You'll never go skint making a profit, and there's nothing wrong with it. In my late teens and early 20s, I learned so much about dealing with people and seeing how they conducted themselves in a deal from buying and selling used cars."

Go-kart racing and a championship win in 1972 led to motor racing's Formula Ford, then to Formulas Two, Three and 3000, where he learned how to build and set up cars.

His first team, Eddie Jordan Racing, competed in these lower ranks, and his eye for talented drivers saw him sign up Johnny Herbert, Martin Brundle, Jean Alesi and the legendary Ayrton Senna. He took Alesi under his wing and even had him live with his young family in Oxford.

He describes his management style as similar to that of former Manchester United manager Alex Ferguson.

"Over the years, we'd compare certain situations and how each of us would approach them. Often we found we thought the same way. I'd describe it as being brutally fair, with no room for complacency, as difficult drivers like Alesi, Michael Schumacher and Eddie Irvine can attest."

Jordan Grand Prix was founded in 1991. The first team to use CAD computer design technology to design a car, it notched up 250 races, third places in drivers' and constructors' championships and four race victories out of 19 podium places.

"I couldn't imagine failure, but I had to duck and dive, buying and selling drivers to survive. Seven of my ex-drivers went to Ferrari and they had to pay good money for that. I probably made more money alongside the sponsorship from wheeling and dealing. It all made the team stronger."

Survival and the camaraderie were the most satisfying parts of running Jordan. There were massive highs and lows - one low being the death of his friend Senna in 1994, who he'd previously hoped would join him as a partner to run the team. Jordan also felt acutely at times the isolation and loneliness of being the team manager, and the financial stress that went with what could be a cut-throat business.

From 2001, despite having sold a 49.9pc stake in 1998 to Warburg Pincus, which got sold on to Merrion Capital in 2004, making enough money to survive in the face of the financial weight rivals such as Ferrari could wield was becoming too great a challenge. The team was sold in 2005 for somewhere between €40m and €75m to Midland Group, a Russian-Canadian group of businesses.

Though the team name is no more, Jordan has no regrets.

"Each year was a fantastic roller-coaster ride. I've been incredibly lucky in all aspects of my life, perhaps more than anyone else I know."

However, he was asked to run several other teams sometime afterwards, but declined.

"Several people and teams - some very significant - asked me to go back into managing. But I said no. Why would I return and run someone else's operation?"

Formula One badly lacks a cheeky underdog team like Jordan at the moment. Does he think a team could do what Jordan did today?

"Red Bull might be one to watch, but F1 desperately needs more stories like 18-year-old Max Verstappen winning the last race in Barcelona. It's boring to think that only one or another Mercedes driver can win at the moment, because Ferrari are looking hopeless. But those two teams are abusing their position of power because they supply engines to so many other teams. They're to blame for the current state of F1.

"It's not interesting or exciting enough for the hardcore fan. A sport that has its roots in people who built cars in their names and believed in what they were doing and then fought it out every weekend has become very corporate. The likes of Ferrari or Mercedes just aren't taking risks like I was," he explains.

He gets "a different buzz," from broadcasting, and presented F1 on Channel 4 before moving to Top Gear.

Although he has eschewed mentoring or angel investing, preferring to leave it to "younger, cleverer people", he enjoys passing on his knowledge speaking at conferences and in a number of advisory roles on boards, including that of Clareville, among whose major backers are David Ross and Charles Dunstone of Carphone Warehouse.

"I've found hedge-fund investing hugely interesting, and have been involved in both the upside and the downsides. At times, it's taken very big hits. But with the chance to make massive profits come huge risks and potential losses on the other side.

"I've made losses, of course. I'd hate to tell you how many. Like any hedge fund, it's a basket of investments devised to make a return. If you make a profit, it's good to reinvest it. I'm not a hoarder, I like to invest in things."

He declines to elaborate further. At one stage the fund managed over £400m and it had returns of 54pc in 2013, reports claim.

Another interest is horse-racing. "Mouse Morris, who trained this year's Irish and English Grand National winners, always has a share in a horse for me. I once had a big share in a horse called Rostropovich."

Concluding our call, Jordan says his most memorable Top Gear trip was to South Africa. "We had great fun photographing wild animals in a game park and racing each other. It was five days of bliss," he enthuses.

There is no classic car collection, no giant garage full of supercars, he adds. His day-to-day car is a BMW M235i coupé, while his pride and joy is a primrose yellow E-type Jaguar convertible. "It gets more photos and admiring looks than Monaco's Lamborghinis, Ferraris, million-euro McLarens or Bugattis," he laughs.

As we say our goodbyes he adds that it's nothing like the old Morris Minor with bright yellow wheels - "like a clown car" - that he once drove in his Bank of Ireland days.

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