Mark Dixon, CEO of Regus: A true entrepreneur back on the expansion trail

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The Independent Online

Mark Dixon is irrepressible. Like the dyed-in-the-wool entrepreneur he is, problems are always history and the future is always bright.

Mark Dixon is irrepressible. Like the dyed-in-the-wool entrepreneur he is, problems are always history and the future is always bright.

Yesterday his Regus Group announced a potentially transforming deal, to buy HQ Global Holdings for $302m (£163m). It will strengthen the position of Regus as the world's biggest provider of temporary and outsourced offices, vindicating a business model that has seen Regus's value bounce from billions of pounds to bankruptcy and back again. An operation that was billed as recession-proof turned out to be anything but.

"We've learnt the lesson," the energetic, driven Mr Dixon says several times during our conversation at his flagship office centre in the heart of the City. "We suffered because we overexpanded in the boom, and that was our mistake. I've learnt more in the past two years than in the previous 25.

"Our customers were originally a whole bunch of start-ups, but now we open offices for the likes of Boeing, Glaxo, IBM and governments round the world. It's what our shareholders wanted, and it's much more stable."

The important point to bear in mind about 44-year-old Mr Dixon is that he could have been running any kind of business. He is proud of the fact that Regus is the eighth enterprise he has launched in a career that stretches back 28 years to the day he left Rainsford comprehensive school in Essex and launched Dial-A-Snack, which took orders for sandwiches that were delivered by bike.

"The trouble was they don''t teach you about profit margins at school," he said, "and I put too much chicken in the sandwiches. There was no chance of making any money."

Mr Dixon says he can't remember when he decided to run his own company, but at school he sold peat to a new housing estate where the gardens needed nourishment. "I was just always interested in the business sections of the newspapers," he said.

After selling the fledgling sandwich outfit, he set off around the world in an effort to make up for his lack of university education. Braving the sceptically raised eyebrows of his father - a Ford car mechanic - he became a barman in St Tropez, a miner in Australia and a farmhand in Asia.

He came back to Britain with dwindling savings and an ambition to make money of something basic that everyone needed. He hit on food.

That took the form of an all-night hot-dog van off London's North Circular road.

Mr Dixon had problems getting buns, which like a true entrepreneur he recognised as an opportunity: he decided to make them himself. He left the dogs to others and became a full-time baker, supplying buns nationwide. That netted him £800,000 when he sold it in 1989 and took a trip to Brussels which proved fateful.

"I couldn't find an office there," he said. "There were already companies providing serviced offices, but I thought I could do it better, with all the services, and maybe set up a centre in every European Union country." That was the genesis of Regus.

His entrepreneurial instincts led Mr Dixon to expand like fury during the 1990s, which set him up for the sucker punch which was the boom that brought that decade to an ignominious end.

"We grew at 90 per cent a year during the 1990s," he said, "but in the last three years we have had to focus much more on the business."

In that period he floated Regus on the stock market, basking in a £2.3bn market value at one time, yet had to sell a stake in the UK operation to the venture capital group Alchemy Partners and filed for Chapter 11 bankruptcy protection in the US. When the chips were down, Mr Dixon demonstrated the entrepreneur's ability to wriggle out of the tightest of corners.

"We got badly caught in California," he said, "because there were so many firms being started up in Silicon Valley. But we're back in California; it's seen a strong up-tick lately because they have this ability in America to pick themselves up and start again, and they are much quicker to seize opportunities to save money."

Mr Dixon rightly sees the US as the place to be, because his serviced offices fit in with that country's can-do attitude and low property prices. He has temporarily relocated, at Regus's expense, to Connecticut to be in touch with the US business's New York base. He has taken his five children, aged seven to 20, over there and reports that his only son has already acquired an American accent.

With the addition of HQ, the enlarged group will have more than 650 business centres in 52 countries. While Mr Dixon does not expect to visit every one, he will spend plenty of time on the commuter plane from New York to Dallas, where HQ is based.

"There are 200 countries or territories in the world," Mr Dixon said, "so there is tremendous growth potential. We have recently moved into Libya and we are working on a project in Nigeria. Yet we represent only a tiny proportion of the real estate in any country."

He accepts that this is because the serviced office concept has taken time to gain acceptance among the business community at large. The habit of controlling your own office space is ingrained.

"But things are changing," Mr Dixon insisted. "Big companies realise that we can set up a branch for them in Peru and provide all the backup. Most of our offices are for 10 people or fewer."

But Regus's credit-card style Priority system means the company has to keep spare space available in many countries to meet the promise that they can just turn up and use the facilities.

Mainstream property companies have decided against copying the Regus model but this, according to Mr Dixon, is because Regus is not a property company. "This is a real business that people want to use," he said. "It has a lot of moving parts, whereas property companies prefer to sit on fixed assets and let estate agents do their marketing for them. But they can see our model works; quite a few have asked us to take space with them to start a centre because they don't have the expertise or experience."

One of the reasons Regus was humbled by the collapse was that its leases are longer than those of its customers, so it was left holding unwanted capacity. Yet the document for the HQ deal still feels obliged to say: "If demand for serviced offices fall for whatever reason, the group is likely to be unable to build or maintain occupancy rates, prices or revenues. If revenues decline, the group may not immediately be able to reduce its lease costs and may be also be constrained in doing so over the long term. Similar considerations apply to HQ."

"Oh, that's just a formality", Mr Dixon said dismissively. Spoken like a true entrepreneur.