Sir Terry Leahy and Michael Welch of Black Circles

Conference review: Terry and Michael

So much of business is about bravery. That was one of the outtakes from last month's MS conference. The bravery to challenge the status quo, to stand up for what you believe in or to be brave enough to fail.  

On the face of it, what Michael Welch did to get his online tyre business, Black Circles, off the ground wasn't that brave. He just asked someone if he could drop in for a cup of tea.  

But when that person was Sir Terry Leahy, ex CEO of Tesco and the asker was an ex tyre fitter, the nature of that bravery is clearer. And despite the disparity in age and experience, and the fact that they support opposing football teams, the two men got on like a house on fire.  The result is a £23m turnover business that is revolutionising the traditional, stock heavy replacement tyre business.   

Leahy saw in Welch an entrepreneur - 'Entrepreneurs do things that other people think are too difficult to do' he said, 'Michael had fire in his belly'. And Leahy should know. After all he set up Tesco Clubcard despite the fact that the board turned it down originally.  

As a tyre industry insider, Welch could see that there was an opportunity to rethink the way the business operated, dropping the heavy overheads of stock holding and warehousing and moving to a lean, on-demand model supported by a network of partners. His new model was around the service, not the product – another area in which he must have had in common with Leahy, bearing in mind Tesco’s ‘Every little helps’. Welch also took risks, but got other people to share them. 'If you don't have the money', he says, 'you do things differently. Because you have to.'

What he saw in Leahy was a partner he could trust. Leahy looked for innovation and creativity before he invested, as well as evidence that the idea could be turned into an ongoing business. But beyond that, he too was looking for someone he could work with. 'We are imprisoned by computers’ he said, ‘but people are at the heart of business.' Welch agrees. He now hires people like him who have that fire in their belly. Perhaps in due course one of them will come to him for a cup of tea.


Francesca is a director at Omobono. Read more from Francesca and browse conference content in our Clubhouse.

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