42 Degrees - Business from a different angle

Millionaire entrepreneur Ben Way may have gone bust with his first venture, but he's bounced back older, wiser and better informed than ever before

Dramatic rises and falls in personal wealth don't always make front page news, but when the CEO is aged 17, suffers from a serious form of dyslexia, borrows £25m for his search technology business then finds himself too broke to buy a tube ticket home, people get interested.

Now just 27, Ben Way's career has so far included vast wealth, significant collapse and being crowned by Gordon Brown as New Business Millennium Young Entrepreneur of the Year in 2000. He has given £40,000 away on Channel 4's Secret Millionaire show and spends his spare time climbing mountains and riding horses. When he finds time to sleep remains something of a mystery.

Six years ago, Ben Way was just below Robbie Williams in the Sunday Times Rich List of 2001, with an estimated wealth of £18.3m. Within a few months, it had all gone horribly pear-shaped. "I lost everything – my company, my house and the girl I loved," he says. "Everything. All I had left was £30,000 of debt."

If there is a key turning point in this young entrepreneur's career to date, it has to be that moment when his new empire crumbled around him so emphatically. The business had not failed. It was an unfortunate mix of naivety, inexperience and bad advice that brought Ben Way to his knees.

What had happened was that Ben had been diluted. "It's like the price of the business is 100 marbles and I have 50, then someone comes along with another 1,000 and tosses those in so my 50 are suddenly worth nothing at all. My investors broke parts of the agreement, but there was nothing I could really do about it because it was under Jersey law and it would have cost a small fortune to fight them. Also, the agreements were not the best because I was young and inexperienced. I was left with a miniscule 0.000001 per cent of the business." In effect, he had sold his ideas and his business to the investors and left himself with no value whatsoever. He was tossed aside like a disposable carton.

"It was a pretty despondent time," he says with classic understatement. "I took six months off to recuperate, then I got some advisory work, first for the British government and then for the White House. By the time I came back, I was ready to start up again."

But before we get into corporate recovery, it is worth asking how a 15 year old came to set up his own business in the first place. While most of his peers were clubbing and indulging in the most effective way to avoid schoolwork, Ben Way was busy getting his foot on the business ladder with his own IT business.

His early years were rough. "The school was pretty hopeless," he says. His dyslexia had been recognised at the age of seven and when he reached nine, he was given a laptop to help him get to grips with language. "Being told I could never read or write or make anything of myself made an impact. I also had an inbuilt drive to succeed. But there were a lot of brick walls and I had to find coping mechanisms and ways to get round the barriers. I called everyone Sir or Madam because I could never remember names."

With a laptop under his arm, he could begin to undertake tasks previously impossible for him. He developed a search technology called Waysearch, which later became a business-to-business product called Pulsar. A company director at the age of 15, Ben was already starting to get noticed. After he starred in a Channel 4 documentary called Britain's Richest Kids, he suddenly found himself at the centre of the investor interest that would ultimately pull the carpet from under him.

A group of Jersey investors rolled up at Ben's slightly makeshift boardroom in Bath and asked him how much money he needed to get his ideas to market. "I told them, like, 25 million quid or something and they said that was around what they had in mind. It was like winning the lottery."

The investors gave him a big bank balance but the experience did not equip him with the financial skills or legal advice he needed to maximise the opportunity to his own advantage.

"Challenges are there to be got around," he says. "I did have difficulty in being taken seriously at 17 but I don't think I came across as immature, even though I looked very young. I had to find ways to get through the barriers and a lot of that gradually came from finding the right advisors and partners and doing the research. If you're prepared to put the time and effort into it, then you can come up with something that works, but I did find myself in a very difficult position. It came down to believing, fundamentally, that whatever the problems were, I could overcome them."

Around this time, one particular friend and mentor became very important to Ben. This was Chris Moss, founder of 118 118, the telephone directory search service, who took the young and battered entrepreneur under his wing. "I went to live with the Moss's and they became my adoptive family after the collapse. After I'd come back from the States, where I'd been doing consultancy for the White House on third generation mobile technology, I began to feel it was about time I did something again. I took on overseeing the technical due diligence and the technology investment arm for the Rotch Property Group in 2001. I learned a huge amount; really core lessons such as the fact that there's no such thing as failure. It can be a good part of the journey."

As his confidence began to return, Ben began to apply his new-found experience to his future business development. Last year he was asked to join a venture capital operation: "Brightstation Ventures was developed by entrepreneurs for entrepreneurs," he explains. "That's really the key. I'd been looking for a fund for a long time that takes the entrepreneurial spirit and is controlled by entrepreneurs. We understand the problems that start-ups have so we can negate a lot of the risk that normally comes with getting VC money. You use your years of experience to get a feel for whether a venture is going to work or not."

Still young in years, Ben Way's intense life and business experience has given him a unique – sometimes painful – insight into the trials and tribulations of entrepreneurship. That he is now working to give others the benefit of that learning curve is a reminder that business and support are not always mutually exclusive, although there must have been moments when Ben thought that they were.

By Maggie Stanfield