If your pitch cannot pass the ‘Richard Test,’ billionaire entrepreneur Richard Branson isn’t interested in your idea.
The Richard Test has two components. First, the pitch must be free of jargon. Second, the pitch must be short enough to fit on a drink coaster. “If your pitch can’t fit on a beer mat, a napkin, or back of envelope, I’d rather listen to someone else’s pitch that canfit,” Branson told me in an interview for his new autobiography, Finding My Virginity. “Most good ideas can be expressed very quickly.”
In this video excerpt from our conversation, you can see what happens when I hand Branson the three items: a beer coaster, a napkin, an envelope. The coaster prompts Branson to tell the story of a $3 billion company that started on a beer mat.
The story begins with former Virgin Express CFO, Brett Godfrey. Godfrey was leaving the regional European airline to move his family back to Australia. Branson called Godfrey to wish him well and said, “If ever want to do anything in Australia, let me know.” After a short pause, Godfrey responded, “Funny you should say that.” Godfrey did have an idea. He asked Branson to hold on while he searched for a beer mat he had written the idea on. In that moment, Virgin Blue was born. Today the company — renamed Virgin Australia Airlines — is the second largest airline in Australia.
“That beer mat resulted in a $10 million investment and a $3 billion company three years later,” Branson told me. The best ideas are short and succinct. “ If it can’t fit on the back of an envelope, it’s probably a bad idea,” says Richard Branson . “Keep it short, sharp and picture-perfect.”
Virgin Australia isn’t the only company in the Virgin Group that got its start from a short pitch. On a bike ride up Table Mountain near Cape Town, South Africa, Branson’s son-in-law Freddie Andrewes rode up beside him and caught Branson’s attention with this short and irresistible pitch: “Let’s build a movement that combines the sweat of sport with the swagger of Virgin.” Andrewes knew his audience — Branson is a fitness fanatic who starts his mornings with tennis, kite surfing or swimming. Branson was sold and the sports festival, Virgin Sport, was born.
“Because I’m dyslexic. I simplify everything. I don’t complicate things,” Branson told me. “In all of Virgin’s businesses, they have to pass the ‘Richard Test.” It means if Richard doesn’t understand it, the public won’t understand it.”
Recently, Branson has been more public about his childhood struggle with dyslexia, and how he now sees the condition as a gift that shaped the way Virgin communicates its key messages. When Branson dropped out of school at the age of 16, dyslexia was seen as a handicap. Instead, “It should be recognized as a sign of potential,” Branson told the U.K.’s Sunday Times earlier this year. “Dyslexics tend to do well in life because they simplify things.” Branson says a dyslexic brain helps him think creativity and to simplify complexity, an attribute he says gave him “a massive advantage.”
Branson says that you don’t need to have dyslexia to appreciate his advice. He gives the tip to every aspiring entrepreneur or business leader: If your idea doesn’t fit on the back of beer mat, it’s too complicated and he’s not interested. Since Branson has heard an estimated 25,000 pitches in his career, his tip might be worth heeding.