Mark Bouris is without doubt a true innovator, a self-confessed ‘challenger of the status quo’. Taking on the big four banks and their ever-present dominance in Australia is not what many would find simultaneously enjoyable and challenging, yet for Bouris it is clearly where he has carved his niche and found his element. Having done famously well with Wizard Home Loans, which he founded as a start-up in 1999, and then sold five years later to General Electric for a cool $500 million, Bouris then shot to mainstream celebrity when he hosted the Channel 9 reality TV show The Apprentice in 2009.
Bouris’ profile has undoubtedly risen exponentially in recent years. With an extensive mainstream media presence, a twice published author, frequent radio appearances and a regular keynote presenter on the speaking circuit, Bouris has capitalized on his prominence to launch his multi-pronged financial services venture, Yellow Brick Road (YBR).
Unlike many high-profile entrepreneurs, Bouris’ businesses acumen wasn’t honed selling lemonade out the front of his house as a youngster. He says that like many, running his own business came from an opportunity that presented itself at the right time.
“I never really thought about it, it just sort of happened. When I was working for others in Legal and Accounting Firms, I was working as a partner or a consultant, so I guess I was running my own race from early on. Working for somebody was never really my bag, though the Wizard business was definitely the first time I stepped out of my comfort zone into something I really knew little about.”
Bouris doesn’t credit his experience working in financial and professional services to the skills he needed to run Wizard. “My working background didn’t specifically help, but I did have a Masters Degree in Capital Markets which definitely helped, and I had to have that understanding to be able to run a business such as Wizard. In fact, my final paper for my Masters was on residential mortgage-backed securities, where I studied the US model. It was quite interesting going into the Wizard business having studied the specific area that I had. I guess it was a curiosity for me and it sparked my interest.”
Start Up Challenges
Wizard Home Loans grew quickly through its capitalization on the gap of non-bank lenders in the home loan market and Bouris was quick to spot the opportunity and seize it. Though like many small business owners experience, managing a growing business is not without its major hurdles.
“Capital is always a problem. In the early days you chew a lot of money up, and if you don’t have enough capital you can’t attract the right kind of people to work for you. You’re always playing defensive, which means you don’t grow. You need financial and human capital. Fortunately in those days it wasn’t as hard to get as it is today.”
Yellow Brick Road, established by Bouris in 2007, brings together a range of financial service offerings including insurance, mortgages, advice and planning via its network of branches. YBR seeks to give the best advice regardless of its client’s income or assets. Starting over again with YBR seems like a task of mammoth proportions, though Bouris is clear about his motivation for doing it and what he hopes to gain personally from the venture.
“At a personal level, it’s just to prove it can be done and to prove to everyone who says you can’t ‘beat the banks’. To do what everyone thinks can’t be done, can. I want to show that a small business can actually take market share from a bank. To the people that say our model doesn’t work, I want to prove them wrong. Personally, I do it to prove a point, I tend to like to argue everything, which can be misinterpreted at times.”
“To execute it at a business level we have to provide a superior service than the rest and provide a better offering than the others can. We’re transparent, we have a fee-for-service business. If you’re running a small business and you come into our offices I will guarantee you will walk out knowing more about your business than you came in with, because we know the questions that need to be asked, and business owners need to be pushed. They need to be challenged, and to be asked the tough questions, much like what 10x probably does with its clients.”
Growing Through the GFC
Setting up a business during the height of the GFC seems like a bold move, but as Bouris recounts, having a healthy dose of hope has enabled YBR to grow and thrive.
“Fortunately we didn’t have a really great problem here through the GFC. Whilst problems were evident, we didn’t get desperate, like much of the rest of the world. We have despaired as a country in the past, such during the recession ‘we had to have’ in the late 80s and early 90s, and it is true that you can’t recover unless you have hope. To set up a financial services business (YBR) in the middle of the GFC, you’re either stupid or you can see something that is going to come about. I didn’t know that the GFC wasn’t going to become a major problem for Australia, but I did hope it would be ok. I know that cycles work their way out eventually. If you have hope and you hang on, you will get there. It’s a message we instill in our clients, staff, shareholders, and everybody we deal with!”
Looking at the future, Bouris notes that there certainly will be more cycles and major economic changes. “They happen every ten years or so, at least things are changing now because of the changes in our communities and how we receive information. The cycles may be further apart now but when they happen they are much more volatile. Because of information systems, the way we find out about things now causes us to react upwards or downwards much more violently. We get our information so rapidly and it is shared so profusely – look at social media. So we create the cycles. We all follow the same thing, and there really isn’t enough weight given to behavioural economics and how we react as a society.”
Shaking Up the Banks…Again
With an oligopoly seen again now post-GFC by our big four banks, Bouris believes that surpassing their less-than-desirable service levels and grabbing back their market share will be more than possible to achieve.
“Banks talk about service because that’s the only thing they want to differentiate themselves on. They spend more money on promoting their said ‘good service’ than they do on actually providing the service. The people at the bank aren’t getting paid to give good service. I go to the bank in this building (a building which I own part of!) every week to draw money out, and get asked for ID every time by the same guy! And I think, ‘What are you doing, you’ve got MY money!’ The service you get from a bank is the same as you get from a supermarket deli counter, you take a number and wait to get called. There is no such thing as a personalized service at one of our big four.”
Changing the Status Quo
Obviously starting over with YBR isn’t what keeps Bouris awake at night. With 30 branches already up and running and an aggressive growth strategy, he is paving the shiny yellow path back to becoming a serious competitor again to the banks’ offerings and is hoping to shake things up along the way.
“We are looking to grow to 150 branches nationally. At the moment we are concentrating on the East Coast but we have recently opened in South Australia, and will continue opening branches over the next year. I don’t really see any difference in establishing YBR afresh, it’s just the same deal and we are setting up again and just reestablishing a valuable brand. I enjoy challenging everything. I love disruptive technology, anything that disrupts the status quo. To me that isn’t like work, it’s what I get my kicks from.”
Though like any new business offering an innovative model, one that differs from how things have always been done, the concept of having several financial service needs met via one provider is a challenge faced by YBR, and to an extent there is a mindset that needs to change.
“Yes you do have to educate. Some people don’t want all the services we offer, some want two or three, and really we haven’t got many customers that want everything, yet. It’s going to take time, and over time we work the different services and products into the relationship we build with the customer, depending on their needs. We don’t want to be a one size fits all. But we want to offer all sizes from one shop, so our customers can pick and choose as they go through the various stages of needing certain services or products.”
The Business Wizard
In 2009, Bouris’ profile was lifted after he hosted the Channel 9 reality show, The Apprentice. Many now recognize him from the show where he played the same role as Donald Trump in the US version.
“It’s funny hardly anyone asked me much about The Apprentice after I did it in 2009. I didn’t think The Apprentice did much for Yellow Brick Road at the time, but now I get asked about it all the time when I am interviewed about Yellow Brick Road. The wanted me to play this Donald Trump character and be all like… ‘You’re Fired!’, but there was no way I was going to do that, I had to do it as myself.”
Outside his business pursuits, Bouris loves his sport. “When I’m not working I love my Footy, I’m on the board of the Roosters. I love the State of Origin. I also like gardening and growing my own vegetables. I like to have something from my garden each day. Work really is my passion, because to me it’s not work. I know there is drudgery in part of it but the challenge is what I love, it’s like a pastime for me. I’m also on the board of a lot of other companies… I love technology and innovation. All of us have something we like that we know nothing about. It fascinates me all that stuff, design, technology and science. That and footy!”
Standing Up for Small Business
When we discuss small business in Australia, and what is needed to help this sector thrive, Bouris understands well the challenges faced by so many in their early stages.
“It’s a big issue and I had to address this to the NSW parliament recently, and I said whoever wins the election should introduce an incubator fund for small business, as well as setup a hub like area for small business. It would be like going into an Apple store, and perhaps you would have business mentors, such as 10x coaches walking around going, ‘Hi, how are you going today?’”
“At Apple you get all these free sessions on how to design websites, or edit your photos, and essentially you become a ‘Mac’ for life. I reckon the government should have a system like the Mac system, where they offer pods for people with different skills, bookkeepers, marketing, designers etc, and people there helping you with areas you need. It would give business owners the opportunity to ask questions like, ‘How do we do this?’ or ‘Are we doing the right thing with our business?’ And I do think the government should pay for this!”
The Role of the Mentor
Getting help during those early stages is something Bouris believes is crucial. “I do think at an early stage and starting up, it’s really important to have someone there that is going to ask you the tough questions, and challenge you about why you are doing the things that you are. Most advisors are more compliance driven and I think that an advisor in a SME business is really important. Just to have somebody there to ask the hard questions. In family business often people get too close to things and are proud of something, and while they are busy defending what they are doing, usually that’s where problems are occurring.”
“In a nice way, that’s why an external coach or mentor can ask those questions. Someone outside of your business makes you stop and think about what you’re really doing and why!”
“Think about what were like as a little kid, really, today you are just the same person. Inside you is that same person today, and you are still that person with your clients and colleagues. Nothing’s changed, and I reckon all of us have to go back and understand who you were and not try and be somebody else, because that is what you are best at. Too many people think they need to be someone else, particularly in business, and usually that just doesn’t work. As a kid I was always asking questions. My brother actually asked more questions than me as a kid and today he’s still doing it, in my business!”
“I have a saying in business, that to be successful you need two parts. And you can’t be both parts. One person cuts, and the other person sews. You can’t have two people cutting or two people sewing. For me, I cut and my brother sews. It’s always been like that. The cutter can sometimes make a mess, so the quality of the stitching must also be good! I think as a person to be good, you have to have the opposite around, you can’t have a solid partnership without one or the other.”
By Brianna Power
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