James Caan

19/01/2010

Dragons’ Den entrepreneur explains why he has gone into business with The Big Issue

By Helena Drakakis  

When entrepreneur James Caan set up his first business – recruitment agency Alexander Mann – in exclusive Pall Mall, his clients waiting for
him in reception were blissfully unaware that his broom cupboard of an office upstairs barely fitted him, let alone a desk.

What they also didn’t know was that the unassuming young man, born Nazim Khan in Pakistan and raised in London’s East End, looking after their recruitment needs would one day become one of the UK’s most successful entrepreneurs.

“I think opposites attract,” says Caan, leaning back on a black leather swivel chair inside the Mayfair hub of his most recent venture, the private equity firm Hamilton Bradshaw – another nom de guerre. “I’m always looking for ways to take me out of my comfort zone. If I’d just done what I did yesterday I wouldn’t have grown. It’s what makes me alive.”

Caan’s humble beginnings seem utterly removed from the grandiose marble entrance of Hamilton Bradshaw. Upstairs in his office, his face adorns many magazine covers on the wall; a framed photograph of Caan shaking hands with former US president Bill Clinton sits across from his desk; there are antique leather-bound books beside his screen.

One spine reads ‘Government’ in gilt lettering and another, ‘Dragons’ Den’, the TV show in which he sits as one of five investors in Britain’s business hopefuls. He enters a room like a tornado but has the manners of an English gentleman.

This morning, his BlackBerry is buzzing. He’s closing a deal on a healthcare business but next month he’ll visit Pakistan as the recently-appointed chairman of The Big Issue: the person who, with Big Issue founder and editor-in-chief John Bird, will spearhead the magazine’s Pakistan arm.

It all seems slightly incongruous: the gleaming London office, the multi-million-pound turnover, the refined demeanour, the desire to champion the homeless in his homeland. “When I was growing up I was very focused on building a business,” says Caan, admitting that philanthropy was not a stop on the route he had anticipated.

“As you mature you become more aware of the world around you. To be in a position to want to give back is, I suppose, to be in a position where money isn’t everything,” he says. “I’ve chosen to spend money on things that are not just important to me, but important to other people.”

While “giving back” has become Caan’s next step, there is also the sense that he is peeling back the façade and rediscovering his roots.  

He thought he’d truly arrived when he sold Alexander Mann in 2002, his net worth estimated at around £70m. “I worked really hard to make money because I was generally striving for what money could buy. If I wanted to buy a yacht, I had to make enough money to buy a yacht and the yacht became the focus,” he explains.

“The problem is, once you’ve arrived at the destination there is no longer the need to chase.”

Caan considered early retirement – he learned to fly, to race fast cars, anything in fact to substitute the adrenalin rush of deal-making − but rejected it. Utterly dissatisfied with twiddling his thumbs, he embarked on an MBA course at Harvard and began contemplating his future. 

“I chose philanthropy,” he explains. “It’s become an incredible motivator and, funnily enough, it’s a far bigger motivator than the yacht.” Caan had already given up writing cheques to charities because sending money was, as he saw it, motivated by guilt. “I gave thousands away, but I thought, ‘Did the money ever get there? Did it actually make a difference? Did anybody really benefit?’

“I decided that if you are going to do something, you have to mean it. For an entrepreneur, writing the cheque is the easy way out but I wanted to experience the issue I was financially supporting. I wanted to understand it.”

Pakistan provided the inroad for his new direction. His parents had arrived in London’s Brick Lane from Lahore when he was two years old. He had not been back since 1971 but its influence was ever-present in his childhood home. It was perhaps most defined by Caan’s relationship with his father, which became strained after he refused to inherit the family business, making and selling leather jackets, and dropped out of education aged 16.
Changing his name from Nazim Khan by deed poll to that of a Hollywood actor helped Caan integrate more easily in the Western business
world he went on to inhabit, but for his father it was a further blow. “If you are an immigrant in a foreign country it’s difficult,” he leans forward, staring with steely eyes. “You have to work twice as hard. You have to be twice as good. And building my business wasn’t easy.” In later years, father and son reconciled and, following his dad’s death in 1999, Caan reconnected with Lahore. He sees commerce as the way to bring Pakistan out of poverty but has realised that for many, the essential building blocks of life do not exist.

“I wanted to educate children, so I built a school,” he says matter-of-factly. “If I was sitting at some black-tie dinner in London writing a cheque for £10,000, I wouldn’t be engaged,” says Caan, who has found it increasingly curious that he’s ended up spending more money than ever before on his current ventures. “Here, I began to understand the issues, and the issues are very real.”

Caan imagined not only educating one child but whole villages. “Imagine if kids were taught to read or write. Imagine the children going home and using their maths lessons to help their parents balance the household budgets instead of borrowing from loan sharks,” he says excitedly. And, just as in business, Caan has been nothing but hands-on.

At first, he flew out to Pakistan with his wife Aisha every six weeks to monitor the building of the school, and in 2003 opened the Abdul Rashid Khan Campus, a building for 400 pupils with his father’s name sitting proudly across the gates.

He confesses that every time he arrives, tears well up in his eyes. He is now a regular visitor there – and it is proof, to those who considered it a
hair-brained scheme, that failure was not an option.

In 2005 he again embarked upon a project that most would not have touched: the rebuilding of 100 homes following the devastating earthquake in Kashmir. Caan got on a plane, travelled to the region and asked people on the ground what they needed. He then returned home and directed the operation from his London office. “I am not an architect or a builder but all of a sudden I was tasked with building a house that’s earthquake-resistant and can take 18 inches of snow.”

He becomes animated as he describes the pitfalls he hadn’t foreseen, including, on one occasion, sitting in Mayfair, arranging 45 mules to take the wooden frames across a snowbound mountain.

“The thing I’ve found with me and other entrepreneurs is that the concept of ‘can’t do’ doesn’t come into it. You find someone; you get someone in, and whatever the problems are you sort them,” he says. Despite spending “ridiculous amount of money” in the end, it was the challenge that excited him. “Providing those houses became a project in itself, and that is far more interesting to me.” Caan’s eyes are now set on further projects in Africa – where he has been working with Comic Relief – and in Pakistan, which includes an orphanage he will scope out when he visits next month. He’ll put the wheels in motion for The Big Issue Pakistan, too. The organisation piqued his entrepreneurial instinct, he says, and he is adamant it will succeed.

“In its own way, The Big Issue is about motivating and stimulating entrepreneurship, it’s about taking the homeless and making them mini-entrepreneurs and it’s a very honourable thing to encourage, so it sits with my own philosophy,” he says.

“I’m at that place in time in my life where it feels like the right thing to do.”

Setting up a street paper in a country where homelessness is abundant and the streets teem with sellers is no easy task. “I don’t want to reinvent the wheel,” he says, outlining a plan to tap into local publishing houses, distributors and grassroots organisations already working with the homeless.
“We will advise them on The Big Issue model – we don’t want a wealthy donor but a sustainable business structure,” he explains. 

“All we are doing is preventing people from having to beg by teaching them how to make a living. This is not teaching a man how to eat. It’s teaching a man how to fish.” Whatever obstacles might befall him, Caan is supremely confident. It’s about deciding what you want to do, and doing it. “Welcome to the world of James Caan,” he announces before his tailored suit jacket is on and he’s marching downstairs, BlackBerry in hand.