£33M at 30 must be good

£33M at 30 must be good

Richer already than some Royals, Sean O’Connor tells Brian Nicholls his unexpected situation does bring some droll moments.

You can’t knock up £33m just a few years after university and not expect friends to josh - especially when they know you’re earning more than Keira Knightley, Cheryl Cole and the Princes William and Harry. Yes, agrees Sean O’Connor, it was quite funny when the latest Sunday Times Rich List came out showing him as Britain’s sixth richest 30-year-old or under.

“I’ve had a lot of jokes on evenings out from my friends, like it always seems my turn to buy the rounds!” he says. The clean-cut multi-millionaire looks, on first encounter, like opening bat for Durham County, or the stand-off Martin Johnson badly needs to succeed Jonny Wilkinson if he’s to manage England back to rugby glory. But O’Connor’s lean, relaxed and confident look is about all you might associate with him holding a BSc first class honours degree in sports management.

You would, if anything, expect instead a furrow or two on the brow, like many more seasoned City types have been showing. But this entrepreneur, whose trading and investment success started and continues in the North East, entered the wealth list this year largely through his Clean Energy Capital (CEC) venture - still only in its third year and launched when he was 27. Signs are, even better is yet to come. The company, run from Leeds, London and Sunderland, where it began, trades and invests in green energy.

It achieves its enviable revenues on a staff of 11, skilled in environmental technology, fund management, investment appraisal, and carbon and energy trading. CEC plc raises money for green energy research then trades the resulting power, recognising that power markets will more and more seek renewable sources of electricity, gas, and fuel.

Its trading arm, via big banks, also buys and sells carbon credits between companies that need them and those that don’t in our increasingly regulated environment. It helps at once to provide liquidity and secure lower emission rates. Asked how he’s done so well, he may reply: “We’ve found a niche.” Many besides himself had been thinking about opportunities in green energies, he says.

“But many people didn’t understand the sector.” That O’Connor is still £9m behind Harry Potter actor Daniel Radcliffe on the Rich List could be a position changed before long. CEC already looks set this year to more than double last year’s profits from £1.25m to £3m with a £110m turnover, despite a mere 1-2% profit margin on some activities. His acumen at 30 may exemplify that of many among the 771 people from the UK’s 1,000 richest of all ages who are now self-made millionaires. No silver spoons, no luck from the Irish implicit in his name and family background, O’Connor just studied at Northumbria University, got his degree then covered the North East and Scotland as a salesman for Nike.

“The big corporate environment didn’t suit me. It’s for some people, but not for everyone.” However, during his nine-year residence in the North East – he’s Bradford-born – he realised options exist. He bought a house off-plan in Gateshead whose value had soared £25,000- £30,000 on completion.

“It seemed to me,” he says in a soft Yorkshire accent, “that I was earning more off a house in six months for doing nothing than I was in my job at Nike. I thought: ‘There’s got to be a business in this’”. In 2002, with property still booming and he just 23, he ventured deeper into property. He still has a personal portfolio of 40 properties worth about £5m and is a sleeping partner in the online Sunderland estate agency Launchpad Homes.

Housing markets, though, are cyclical and in 2005 with the property still going well “but starting to get hard”, he devoted a year to anticipating the next big moneymaker.

“I realised everyone who’d done very well creating businesses has done so by getting into a new market at the start.

“Once a market matures, it becomes a lot harder to penetrate. I felt I had to build a business in a new sector. It was a case of identifying that. I felt green would emerge over the next decade.” He chose technologies that could be commercialised to create or dominate key markets, then launched the business. Was it the Kyoto agreement that made CEC? “That was a specific protocol that got people thinking green,” O’Connor agrees.”But Kyoto was just the first of a number of things in this evolving market.

Governments all over the world are now worried about what’s to be done about finite energy - Middle East oil and that kind of thing.

“They want to look at alternatives. Even discounting the climate change argument, there are logical reasons why people want renewable energy. But the general view is: oil is finite. People only argue over when it’ll run out.

“It’s a big concern if the lights go out in however many years, or petrol runs dry at the pumps. So it’s built on more than government concerns about climate change. It’s built also on ordinary people’s concerns.

That’s what has created the market.” Kyoto has driven regulation and infrastructural support – enough to offer investors stability necessary to ensure big capital commitments. With a £10,000 grant and helpful guidance from Business Link North East, O’Connor went ahead. With clean energy solutions a major priority globally now – albeit still lip-serviced in many countries and instances – numerous emerging opportunities enable CEC to create new investment platforms for its own funds and those of institutions, as well as for high net-worth individuals.

O’Connor explains: “We target best propositions in the sector. We then give expertise and support throughout a project’s full life cycle – from initial concept through key development and on to full commercial deployment. We also seek to maximise the value available from any carbon credits and energy outputs generated by our investments.

“Initially the market seemed small and many didn’t take it seriously. As it has become an issue people realise they have to deal with, and more and more they see things happen, the more they realise it’s a market they must embrace.

“Our strategy to help what we can do is partly to attract this new high-net worth group of people we can work with. More people are realising this market is a real commercial proposition - probably one of the biggest commercial opportunities that exist. We’re targeting people who’ve made money in other sectors and who know it’s a space to be in, but don’t have expertise currently to access this market. We do that for them.” Keen to spread green in the UK, he finds however that many barriers delay things that ought to be done.

“You’re met by reasons why you can’t, rather than reasons why you can, especially in planning.” Will the new government address this? “You never know. With any change comes a need to make your mark. So there will be changes, and renewables is written quite heavily into the manifesto of the Coalition. But the devil is in the detail. We’ll see how that transpires.

Meanwhile, CEC will continue to foray in the USA, the Middle East, Latin America and Asia. China’s a particular target. O’Connor finds through joint ventures and partnerships in technology there that less stringent restrictions allow faster planning than in Britain.

He considers North East advances in wind energy, green fuel and zero-emission motoring all great news, and says CEC would welcome more investment from this region to complement that already committed by private individuals here.

Investment from individuals and institutions goes into desalination of water, biofuel farms, waste conversion into energy avoiding landfill, algae and even research into eco-towns aspiring to have homes create their own energy supplies.

Did he ever think his venture would do so well? “I doubt you can ever know how successful something will be. If it works out really well it’s because the calculated gamble you take is going to succeed. Meanwhile, you’ve just got to have a go. I wouldn’t say I’m a particularly green individual. I came into this market because it represents a commercial proposition. It seemed it would grow a lot. It has.

“But it will only catch on in the mass market if it becomes cheap enough and people can afford to embrace green. It’s not about switching lights off at home. It’s about tackling the source of energy going into the lights in the first place.

“Even if everyone turns their lights off it won’t make a huge difference. That’s what we must understand. It’s about funding the systems that will supply the energy from green sources.” He believes climate change is happening but is phlegmatic, not evangelistic.

“If climate change sceptics are wrong and we do nothing, we have a problem. If they’re right and we still do something then we have renewable energy. There’s no logic other than pursuing renewables.”

Despite CEC’s rich returns, O’Connor is not overly sentimental. “My plan is to build CEC to a position where it could be sold, hopefully within five years perhaps. You never know what’ll happen by then though. I’m looking at other projects meanwhile, rather than being linked permanently to any one market.

Clean energy is just what’s been very successful very, very quickly.” Can a degree in sports management help in building a green business? “Yes”, says O’Connor. Any degree studies teach two things in his experience. First, to stand on your own two feet by living away from home, perhaps for the first time.

“Also,” he says, “you learn how to get top marks and elicit what a lecturer wants from you. Applied later to business, it teaches you to understand what people want - you have to understand what suppliers and customers want.

“While directly there may be nothing in relation to what I was taught, there was a general foundation of management, discipline and life skills.” He also gained practical experience in management while he studied. He worked on the Olympic Games at Sydney in 2000.

“I managed to get a few more overdrafts and took an unpaid job because I thought it would give me good experience. I was assistant to the athletics competition manager.” And previously he was events manager of the Iron Man Triathlon in Lanzarote. Now he has won the Ernst & Young North and Midlands Cleantech Entrepreneur of the Year award and goes soon to the UK finals.

If he wins, it will be on to world finals in the US! Today he rakes in more than he might have done even as a Premiership football club manager – with better long-term prospects!