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Tony Nash on Success: “Focus on Cash Flow, Make Many Mistakes”
Tony Nash is no ordinary business person. After Co-Founding Booktopia in 2004, he has become a leader in his own right. We sat down with the 2020 All Star Bash Legend inductee and had a chat about his day to day life, what inspires him at work and why you need to make mistakes to be a success.
Booktopia was one of the first online bookstores in Australia. Co-Founder and CEO, Tony Nash, famously started the business with a budget of $10 a day, where he and his team worked on the business every day and night.
As Booktopia launched, there were critics who doubted the success of the business venture. “When I started Booktopia, people said to me, ‘Why do you want to start an online bookstore? You’re too late. There’s Amazon, Borders, Dymocks, Angus & Robertson’, ” Nash tells Power Retail.
“Now people say to me, ‘It’s lucky you got in early!’ Who’s right? No one. It is irrelevant. If I listened to the first group I would have stopped. If I listen to people today then maybe I would sit back and rest on my laurels. Neither comments nor beliefs serve me, Booktopia, our customers or the book industry.”
At the time of launch, Booktopia used a company that managed its site and fulfilment, and Nash acted as the company’s ‘marketing arm’. After three years, he and his team ventured out on their own.
How long was it until Booktopia started seeing a return on investment? “From about the fourth month,” Nash says. “But we were lucky back then.”
After about 13 years of running Booktopia, the company turned its first profit. But to Nash and his team, profit wasn’t the ultimate goal. “Profit came in 2017. But for all the years before we focused on revenue growth, not profit. When we focused on profit as well as revenue growth, profit came,” he adds.
“We could have been profitable all the way through, we just wouldn’t have grown as fast. Please remember to focus on cash flow in the beginning. That is more important than revenue or profit. You need more cash at the end of the month, rather than more month at the end of the cash.”
In order for a business to remain an integral part of the modern and competitive landscape, it needs to inject new and fresh concepts into the world. Of course, staying relevant and ahead of the times isn’t an easy feat for everyone. But for Tony Nash, creativity comes naturally. “I am a 3-Dimensional thinker,” he says. “I can paint, but I am not an artist. I can sing but not in tune. I can write but I have not written a bestseller. Some things we have a natural talent for. If we master that talent to the best of our ability then we are playing to our creative strengths. Saying that it doesn’t come easy is the only barrier to creativity, in my opinion.
“If you say it comes easy or if you say it comes easier than it did yesterday or last year or a decade ago, then you start to exercise your creative mind which is a perpetual journey towards being creative. Everyone is creative. To say that you are not creative is actually a creation,” Nash explains.
So what happens when one of these new ideas doesn’t turn out the way he had hoped? Nash is an optimist, grieves quickly and looks for options. “When something doesn’t work out the way I want, I feel the feelings of disappointment or whatever is valid for me at that time with as little resistance as possible. It’s then easy to move on to what’s next,” he tells Power Retail.
As an example, Booktopia had plans to go IPO in 2016. When that didn’t come to fruition, Nash says it took three hours to “get over it”.
“We spent a year on the project. Then it felt like one door closed and ten just opened,” he adds.
He pictures these situations like he’s Roy Scheider in the iconic scene from JAWS. “Imagine a boat with a lead keel,” Nash says. “It’s not easy to capsize. If you do capsize, to steal a phrase from the movie, JAWS – ‘We’re going to need a bigger boat’ – with a heavier keel. The keel is your experience, intuition and wisdom.”
While Booktopia didn’t reach IPO status in 2016, it didn’t take long for the company to list on the ASX. In 2020, the business completed its initial public offering, with a market capitalisation of $315.8 million.
As with all businesses, in the 18 years since launching Booktopia there have been highs and lows for Nash and his team. He tells us that, like everyone, businesses need to make these mistakes, as long as there is education and correction along the way. He likes to think of this like aeroplane on its way from A to B. “A plane is on-course three percent of the time and off-course 97 percent of the time, constantly correcting as it makes its way to its destination,” he tells Power Retail. “The key is: make many, many mistakes. Learn, correct. Learn, correct. This message has been told millions of times but it is universally true in all cases at all times. So the more we learn, the more valuable we are to our customers and shareholders.”
There is no such thing as an ‘average day’ for Nash. “The average day is … very different to any other day,” he tells us. “Lots of meetings. Flipping from internal to external, from macro to micro. I could go from a crisis meeting dealing with an operational meeting to presenting to an institutional investor within two minutes.” Nash often has to ‘reset’ and resume his role as CEO “without any residue feelings, thoughts or energy from the previous meeting,” he explains.
On a day-to-day basis, the team at Booktopia are always on the lookout for new opportunities. “There are still huge opportunities ahead,” he explains. “Booktopia is a miraculous Australian success story in an industry where people had written off bookstores, physical books and were overwhelmingly convinced that Amazon was going to annihilate everyone.”
When it comes to creativity and developing new ideas, there’s something that has stuck in his mind, he tells us. In 2012, Nash attended an e-commerce conference. There he met someone who told him he was lucky that he started Booktopia back in 2004. “I looked at them and said ‘Imagine what the people at the 2042 event are going to be saying to you about attending the 2012 event!’,” he says. “There are so many opportunities waiting ahead for us to discover and uncover. Think about it, BNPL hadn’t even been launched when I had that conversation.”
A piece of advice that Nash gives business hopefuls is to not care about the opinions of others. “Who cares what others think? It’s what you believe,” he says. “If it doesn’t work out the way you thought. Awesome! You are one step closer to finding the one thing that is going to go ballistic.”