PrintSimon Pielow, 47
Founder, the Train Chartering Company
Horley, England
"Going without a business plan is against all wisdom," Simon Pielow admits, but that's exactly what Pielow did in 1998 when he launched the Train Chartering Company, a U.K.-based provider of private trains for corporate events. "I guess you can mark me down as the most imprudent person in the Western hemisphere," Pielow laughs.
Actually Pielow's rationale for winging it had less to do with imprudence and more to do with breaking new ground. He entered a market where there were no competitors, no models, and no market analysis. "No one was doing what we do," Pielow explains. "If I'd wanted to prepare a forecast there wouldn't have been anything to hang it on."
What makes Train Chartering unique is its business-to-business orientation. A number of private train operators, including the storied Orient Express, target individual travelers. But Pielow says his company is the only one that focuses on the corporate market. Train Chartering serves such companies as Merrill Lynch and MasterCard, who book private trains to entertain customers on jaunts around Europe and the U.K. The company also charters trains for whistle-stop promotional tours. And it's the preferred train provider for sporting events like golf's Ryder Cup.
Although he didn't have a formal business plan, Pielow wasn't flying blind. As the first salesman for Eurostar, the rail service for travel between London and Paris, he learned a lot about train operations. He also noticed that train travel fosters passenger camaraderie, which makes it ideal for corporate events. "Trains are like cruise liners: They're conducive to relaxing and exchanging life stories," he concludes. "In terms of networking it's a perfect environment."
Before Pielow quit his job as Eurostar's U.K. sales manager, his wife insisted he prepare an executive summary for Train Chartering. Though it wasn't a full-blown business plan, the summary did outline his concept, market, and timetable for profitability.
Train Chartering's market turned out to be very different from Pielow's initial predictions. He figured the bulk of his business would come from travel agents and conference organizers. Instead he found more interest from advertising agencies — who like using trains as promotional vehicles. Advertising agencies, PR firms, and corporations account for 60 percent of Train Chartering's business.
If he had developed a formal business plan, would Pielow have been able to identify his most promising market sooner? Maybe, he concludes, "but the time spent in research might have meant I would have been slower off the mark."
Meanwhile Pielow's financial projections underestimated his actual potential. He thought it might take three years to break even, but Train Chartering turned a profit after just 18 months. Today the five-employee company is on a fast track with revenue expected to increase from $1 million to $2.2 million in the coming year.
"A business plan is essential when you're in a competitive market where a lot of people are doing the same thing," Pielow acknowledges. In an untapped market, however, Pielow simply used his knowledge of the industry and a hunch about the B-to-B potential of private trains to realize his company's success. "If I had done a formal business plan," he says wryly, "I might have scared myself to death."
— Francy Blackwood
