'We aren't in another dotcom bubble - it's just enthusiasm': Lastminute founder defends boom in tech shares

By VICKI OWEN, FINANCIAL MAIL ON SUNDAY

Updated: 08:38 EST, 30 June 2014

Brent Hoberman made his name as the co-founder of lastminute.com alongside Martha Lane Fox at the height of the dotcom boom. It made him instantly rich.

Today sceptics are muttering that Britain is in the grip of another dotcom bubble, with valuations of technology companies defying gravity. But Hoberman dismisses the word ‘bubble’, preferring ‘enthusiasm’.

‘It’s an enthusiasm and it’s not the same as 2000,’ he says. ‘In 2000 you had every company valued as a winner and that was the real problem.

Drive: Brent Hoberman is working with Stelios Haji-Ioannou to launch a scheme where owners can hire out their cars

‘Sometimes the valuations do run away a bit, but more broadly it is a time of optimism in the sector. I think it’s great because the mindset is pro-innovation.

‘It doesn’t, of course, mean everyone’s going to make money.’

Hoberman is still very much in the business of making money himself. He is chairman of trendy furniture group Made.com, which is expected to list on the stock market later this year. And he is a board member of music technology firm Shazam, Eton College, TalkTalk and Guardian Media Group

But at the top of Hoberman’s mind today is his latest involvement with Sir Stelios Haji-Ioannou, the founder of easyJet. Stelios is launching easyHotel on the stock market this week, but is also working on transforming his car rental business easyCar into a scheme which allows car owners to rent out their cars when they are not using them.

 

It is not the first time Hoberman has dealt with Stelios – for that we go back to the dotcom bubble days when Hoberman was just 29.

He says: ‘The first meeting was in 1998. Martha and I went to Stelios to tell him about the internet.We went to try and get easyJet on lastminute.com and tell him that he should be on the internet. He wasn’t quite convinced by that,’ he laughs.

Throughout our conversation he switches easily between seriousness and playfulness. He admits: ‘Since then Stelios became a front-runner of the internet in the UK.’

Now Hoberman, who is looking trim at 46 and has a healthy glow after a trip to the International Advertising Festival in Cannes, where he was a guest at a yacht party attended by American socialite Kim Kardashian, has invested in Haji-Ioannou’s easyCar.

He says: ‘There are people already doing this in America, there are a couple of players in Germany and some successful players in France. But weirdly it’s early days for the UK and we’re the only player.’

Hoberman is keen to emphasise that the easyCar Club is not just a copy of these schemes, insisting that the idea first came to him more than ten years ago.

‘At lastminute we had Holiday Autos, which did a million car rentals a year, so I knew the car rentals business from that. But my enthusiasm for the business was waning as it matured. Then I remember thinking suddenly – probably in 2003: “My car’s sitting in my drive. I’m not using it. Why don’t we let people rent out their own cars?”

‘The team thought I was nuts because I was always trying to do too much, so we didn’t do anything then. I say that as context because I hate people who copy other business models. I’m saying I had the idea a long time ago so I think it’s OK.’

He adds: ‘I went to Stelios a couple of times and said, “Look, why don’t you turn easyCar into this business model and we’ll invest”.’

In business: Brent Hoberman has invested in easyJet pioner Stelios Haji-Ioannou's easyCar venture.

By ‘we’ Hoberman means the venture fund PROfounders Capital, in which he is a partner. Hoberman says Stelios is easy to work with. He jokes: ‘It’s a piece of cake. He’s just a child in a manger. It’s like stealing candy from a baby. I feel bad about that sometimes.’

Hoberman, who has three children and enjoys playing football on Sundays, set up his fund because his record with lastminute meant a lot of people came to him with ideas.

He was, in his words, ‘seeing a lot of deals’ and wanted an orderly way to get involved. Early on in life he was inspired by his grandfather, who ‘started with one clothes shop and ended up with 650’ in South Africa.

His advice to start-ups is: ‘The toughest part about starting a business is knowing when to give up and when to persevere. Sometimes you are literally insane if you keep going in a business that is losing you money. But you don’t want to give up too early when there’s just some barriers to overcome.’

For the easyCar Club, after some success in Camden and Shoreditch in North-West and East London, the plan is to establish a network in a few more locations before rolling it out across the UK.

‘I’d love to see us prove it in small areas – keep proving and rolling it out in small areas where you have enough supply and demand in each,’ he says.

‘There are certain places where we’re going to just really blitz, and make it incredibly useful in those areas so that they become massive evangelists. That way we can get better at operating so that we can roll it out. That’s the excitement.’

And while he insists the business is not a copy of other companies, he is not ashamed to admit that he has been taking note of the lessons that others in the field have learnt.

Hoberman, who does not have a car himself and whose wife’s car is too costly to be part of the easyCar Club, says: ‘There are not super-expensive cars, because there’s a certain cut-off on the insurance band. So unfortunately you won’t find Ferraris and stuff like that.

‘There was a business that tried to do this in the States and they just did super-expensive cars. They gave up because people started trashing them and the insurers didn’t like it.’

That is a business model that even  Hoberman might find it hard to convince Stelios to accept.