- Business
- Small business
This was published 16 years ago
John McGrath interview: 'I got 95 out of 500 in the HSC...'
From not being able to pay staff wages, John McGrath has built a multimillion-dollar business, writes Steve Dow.
Your father, also called John McGrath, was a publican in suburban Bexley. What did you learn about life or business from the family pub?
That was up to the age of 10 [in 1973], so it was early days, but I do remember, even though my dad was a publican, he had a very strong work ethic and a very strong discipline for organisation within the pub. I remember after he died, there was a shoe box of some old stuff, and there was a little guide to working in the pub: how he wanted the staff to look, how he wanted them to act and so forth, which was pretty leading edge going back 35 years. I think I probably got from him his passion for organisation.
So far, at 41, who or what has been the biggest influence in your life or career?
I've been fortunate to have a lot of mentors. In [Sydney Boys' High] school my forte was sport, not the academic side. One of my close friends today, Greg Harris, was our football coach. He taught us about training hard, preparation for the game, visualisation. In [our] competition, Sydney High was always the underdog. He taught us that what mattered was how you played on the field, not how you looked on paper.
In your latest success, the book You Can (HarperCollins), you say failure is part of the journey. When has John McGrath failed? What have been the turning points?
I got 95 out of 500 in the HSC. That is, in literal terms, a failure. However, that was one of the greatest catalysts for me to change my life. The gift for me was [the lesson], "don't screw around and be slack and cut class; it will come back to bite you".
Around that time, at 18 [in 1982], I got two collapsed lungs. The doctor said: "You can't play body contact sport." So those two things would be seen somewhere between failure and disaster, and yet it was the pain they put me through that started me reading and getting interested in information about people achieving incredible goals.
Two years into the business [in 1991] we were down on our knees. The bank rang up one day and said: "We're not going to honour your payroll cheques tomorrow." I very quickly realised that sales didn't equal cash flow, but I didn't have any really solid business grounding. Fortunately I had two property investments that I was able to sell.
First, I made a personal goal that I wanted to become debt-free. Second, I changed accountants. Third, I decided that was the black spot for me. The operational and financial side of the business was something I had turned a blind eye to, and had hoped that it would just be OK. I realised that you can't do that. If you're running a small business, you have to have your fingers on the pulse of all areas of the business, not just sales and marketing.
I believe the success of the business to this day came off the back of that scary and painful experience.
The BRW Young Rich list estimates your wealth at $50 million. Higher, lower or about right?
The majority of my personal wealth would be attributed to my shareholding in this business. I have no intention of disposing of this business, so it becomes a bit of a hypothetical. [But] I think the value of the business is in the ball park.
You're obviously materially successful. Do you put time into relationships and friends?
I think I live a really balanced life. Friendships, relationships those are the things that matter. You don't remember if you made an extra few dollars or not.
So, are you in a relationship?
I'm single. Not commitment phobic, just single.
One of your competitors says you're getting all "hot and frothy" about the poaching of real estate agents. Is that correct?
Not at all. We understand that it's a competitive environment. Not just for the listings, but the talent. We've had a few people leave, but we've had far more people join our team. I'm not at all hot and bothered about that.
Given the cool-down in the property market, and more homes up for private sale, will the home auction be out of fashion in 2005?
No. We had a 70 per cent clearance rate last weekend. That's pretty good. In the boom market, we were up around 80, 85 per cent. When the market corrected, and got really tough, we came down to 40. So we think the market's coming back, and we've seen the worst of it behind us. There are [real estate agents in] a lot of other parts of the world that are saying, "what are these Australians doing that is working so quickly?"
The first thing your McGrath biography describes you as is handsome . . .
Oh, I haven't seen that biography.
It's the one your office sent me
That must be a very old one. That must be in days gone by.
What I'm getting at is, do you think looks play an important part in success?
Oh no, I don't think so. It's about energy. A lot of people say to us, "you've got a lot of young, vibrant-looking people on your team". I actually think in a lot of ways they're referring more to the energy of people than they are referring to anything else. Attractive looks come in all shapes and sizes. I think what's attractive is a great energy, someone who's enthusiastic, someone that wants to help. Someone who's excited about what they're doing, that's the attractive part.
Homes and auctions and reality programming rate well. Ever thought of doing television?
I've been fortunate to be involved in The Block twice, which was a great experience, being able to make comments about the renovations and their actual saleability. I guess I would contemplate it if there was a real estate-specific show. I very much know my niche, which is property. I've had a couple of talks but the actual shows they were talking about haven't got off the ground.
One of your favourite TV shows as a kid was Lifestyles Of The Rich And Famous. What about now? Are you a fan of Donald Trump and The Apprentice?
It's on too late for me. I'm asleep by 9.30. I get up early and go to bed early. I have watched some of The Apprentice and I found it was interesting. I was disappointed at the general calibre of people they selected. None of them really knocked me over with incredible business acumen. I do movies, books and TV to relax. I live a quiet life outside of the business.
It's not my favourite thing to go out to lots of functions. I find that's draining. It was always a fear of mine, because the social side, the networking, never came naturally to me. I do my business networking during business hours 12 hours a day, being with people. I love that, but I also like being able to cut off at the end of the day.