Bernard Walsh - Hot Irishman
This company has gone from being about 40pc to 90pc export-based in five years.
ENTREPRENEURS
Ivan Yates
Celtic Bookmakers
Probably best known for his broadcasting career at present, as co-presenter of Newstalk 106–108 fm’s Breakfast and Business Matters on TV3, Ivan Yates is also a successful businessman as chairman and managing director of Celtic Bookmakers.
Now aged 49, Yates was resourceful from an early age. Born in Enniscorthy, Co Wexford, he left school at 16 to fulfil his father’s dying wish that he get into farming and attended Gurteen Agricultural College in Tipperary.
The seeds of his future in the public eye were sown at school, as he attended the fee-paying St Columba’s College in Rathfarnham, known for its famous past pupils such as Adam Clayton from U2 and actress Victoria Smurfit.
He got involved in Young Fine Gael and was first elected at the age of 21, making him the youngest member of the 22nd Dáil and the fourth-youngest-ever member of Dáil Eireann. He served on Wexford County Council in the Nineties and was appointed Minister for Agriculture, Food and Forestry when Fine Gael came to power in 1994.
Despite his political success – he was heavily mooted to be Fine Gael leader at one point – Yates always kept his hand in on the business front.
Early experience
“From the age of 12, I’d wanted to be a bookie, so I opened a shop in Tramore in 1987 with a IRŁ10,000 loan from my family. I made every conceivable mistake with that shop, from having to deal with fraud, to issues on the trading side to human resources. The competition was fierce,” he recalls. The first shop closed down, but Yates was undeterred.
“I learned from this experience and went on to set up a number of other shops in the south east. For a long time running the business was a hobby, but I decided I should be strategic and focus on it in 2001, as I could see the industry was going to consolidate. You had Paddy Power, Ladbrokes, William Hill and Boylesports at the time and in my view there was room for one more significant player.”
Celtic Bookmakers
By the time Yates stunned his colleagues by quitting politics at the age of 43, Celtic Bookmakers had 11 shops in the south east. Now it has 64 outlets in the UK and Ireland, employing around 300 people and producing an annual turnover of €100m.
The expansion was achieved through a combination of organic growth and acquisitions. In 2006, for instance, Celtic Bookmakers paid an estimated €5m for Joe Molloy Bookmakers, a chain of 12 outlets in the greater Dublin area. Yates shut down two of the shops and spent €500,000 renovating the remaining 10.
“Acquisitions lead to the scale you need to develop innovation and marketing. I intend to continue to look for opportunities in the future,” he says.
Celtic Bookmakers has a telebetting operation, but is conspicuously absent from the online betting arena. Yates favours acquisition over setting up an online operation from scratch, so this could be the next target, he says.
“When I looked into this a couple of years ago, I estimated that in order to get it right I’d have to spend between €7m and €10m, an amount I didn’t have to spare at the time, so an acquisition is a better solution. There are two key trends which will gain pace in the betting industry – gaming and online betting. Racing used to account for 80pc of all betting, but it’s shifting now away from sports towards games like poker.”
Proactive approach to the downturn
When the downturn hit, Yates took a proactive approach on the cost front. “Bookmaking is one of the few industries which gives out money to customers. The business was still performing well in difficult times, but turnover had fallen by 16pc. We had to look at payroll, which was costing €140,000 a week. Through various measures since mid-2008 we have managed to cut the weekly payroll bill by €40,000,” he says.
“My wife and I stopped drawing a salary from the business. We put administration staff on a four-day week, introduced pay cuts and new shifts and made each shop responsible for its own cleaning. I believe in leading by example as well as transparency. Staff have access to company figures as well as being aware of their individual shop’s performance.”
Yates says he also believes in “the tyranny of the multiples” and that “the likes of Tesco will rule the world”, so when it comes to taking on competition in the current climate he is pragmatic. “It’s a bit like the war in Iraq – you can’t take on the various groups on every front. For now, with each shop I aim to stick to the knitting, by being the best shop in Blackrock or wherever.
“A lot of entrepreneurs are having sleepless nights at the moment. One of the things I’ve realised, especially with a family-run business, is the need to let go. Sometimes the person who set up the business isn’t the one to run it when it is well established. My son is coming into the business now and I’ve diversified into other areas.”
In recent years, Yates has gone into public speaking, and has become a newspaper columnist and non-executive director on company boards, for example, geothermal company GT Energy.
