Cannes obsession, Amazon ambition and how to run a company ‘the Richer way’

Planet Business: Bumpier than an Uber IPO

The graft behind the glitz at the Cannes Film Festival. Photograph: John Phillips/Getty Images

The graft behind the glitz at the Cannes Film Festival. Photograph: John Phillips/Getty Images

 

Image of the week: Step-by-step

The phrase “roll out the red carpet” doesn’t come from nowhere: the red carpet must indeed be rolled out, in this case for the 72nd annual Cannes Film Festival where, alongside the high-profile premieres, competitions, yacht posing and traditional rows about sexism, quite a lot of business deals are done. But it’s not all hard work. Producers and sales agents are expected to find time for a break from frantically trying to win the attention of the big film distributors. Champagne reception? Opportunity to hang out with Elle Fanning? No, according to entertainment publication Deadline, the big question on industry lips in the French Riviera is, er, how they can find a way to watch the Game of Thrones finale on Monday. “We’re really hoping someone will show it on a big screen,” it quotes one sales executive. Well, it can’t be any worse than the latest Tarantino effort.

In numbers: Fly with Amazon

$1.5 billion

Investment by Amazon in a new hub for freight airline Amazon Prime Air in Cincinnati, Ohio, where founder Jeff Bezos this week donned a hard hat to break ground on the project.

900

More than this number of acres have been leased by the ecommerce giant for the cargo base at the Cincinnati / North Kentucky International Airport.

100

At least this number of Prime Air aircraft will be based at the hub, with more than 200 daily take-offs and landings by the fleet as Amazon reaches the next stage of its mission to take over the world.

Getting to know: Julian Richer

Julian Richer likes to do things “the Richer way”, which doubles as the title of his 1990s business book. Born in Bristol to parents who worked for erstwhile good employers Marks & Spencer, the founder of audio-visual equipment retail chain Richer Sounds was imbued at an early age about the value – commercial and ethical – of treating your staff well. Having set up his company in 1978 at the age of 19, Richer (60) favoured perks such as cash handouts for staff so they could go to the pub and brainstorm, as well as free access to holiday homes and the use of a Bentley for the best-performing store each month.

Conscious that his father dropped dead at 60, he is now giving more than 550 employees a 60 per cent stake in the business, putting them in line for a collective windfall of £3.5 million (€4 million). Richer doesn’t prioritise maximising his riches: some 15 per cent of his company’s profits are donated to charity. Oh yes, and he’s also the drummer in the funk band Ten Millennia.

The list: Reasons for the Uber flop

Uber, the taxi company disguised as a tech company, hasn’t had the smoothest initial public offering (IPO). Its trip to the New York Stock Exchange has been a one-star journey at best. So why has the road proved so bumpy for the ride-hailing giant?

1. Wrong valuation. Uber’s almost immediate drop on its IPO price was the natural result of the company having been overvalued all along.

2. Bad timing. With Donald Trump obsessing about tariffs again, the stock markets were in a brittle mood on Friday. “You can’t control the day,” lamented chief executive Dara Khosrowshahi. The explanation was only slightly undone by the fact that Wall Street had turned positive by the closing bell.

3. No lift from Lyft: A rough market ride for rival Lyft when it made its debut in March created a “hangover” for Uber.

4. General caution: Retail investors weren’t racing to get a piece of Uber action the way they had for social media IPOs like Facebook and Twitter.

5. Rational scepticism: Maybe unveiling your IPO with a warning that you may never make a profit isn’t so brilliant a gambit.

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