Clipper Ventures CEO William Ward on Global Race’s China Love Affair

Since Qingdao joined the 2005 Clipper Race as
 a dress rehearsal for its role as China’s Sailing City in the 2008 Olympics, the country has developed a love affair with what’s known on the mainland as the ‘people’s race’. The 2005 edition also marked the introduction of the fleet of Clipper 68 yachts built in Shanghai and the race’s first Chinese crew, Guo Chuan.

The Clipper 70s, the race’s
 third fleet of yachts used since the 2013-14 race, were built in Qingdao, which remains the race’s longest-serving partner.

A record three Chinese-sponsored yachts are among the 11-strong fleet in the 2019-20 race, which started in London on September 1. Qingdao is celebrating its eighth straight edition as a host port and team sponsor, the Sanya team is bidding to retain the title it won on its debut in 2017-18, while Zhuhai joins for the first time as it kicks off a long-term association.

Clipper Ventures, organiser of the Clipper Race, has also created a new Chinese company to meet the country’s growing participation in sailing. Named Clipper China, this new division will use the Clipper Race’s sail training expertise to develop offshore sail training and regattas in cities across China, and is building its own offshore racing yachts for its use.

William Ward is CEO of race organiser Clipper Ventures, which he co- founded in 1995 with Sir Robin Knox-Johnston, who in 1969 became the first man to sail solo and non-stop around the world. In the Queen’s 2018 New Year’s Honours List, Ward was awarded with the Officer of the Order of the British Empire (OBE) for his services to the economy and to the GREAT Britain campaign, and he speaks exclusively to Yacht Style and Luxuo.com.

Clipper is embarking on its 12th round-the-world race, having started in 1996. That’s an impressive run, especially for an event based around amateur sailors. Why has it proved such a popular and long-lasting event?

Our concept is very different to anybody else’s. We own the boats. The boats are backed by cities or corporations around the world, so they sponsor a boat.

People pay to do the race and can do one leg or all eight. About 700 compete in the race and 100-120 of those will do the full circumnavigation. Others pick and choose which legs they want based on their budget or availability, or if they have a desire to sail a particular crossing like the Atlantic, Southern Ocean or North Pacific. People can also come back and kind of build up their credentials, their logbook, made up of legs they’ve done in multiple races.

We don’t particularly need sailors. About 40 per cent of people in the race have never sailed before. We introduce a lot of people into the sport of sailing, but it’s more about adventure, doing something they’ve never done before and may never do again. That’s the basis of the company and why it was formed. It’s roughly a GBP50,000 (USD63,000) entry fee to go around the world.

With Zhuhai joining Qingdao and Sanya, there are a record three teams from China and three stops on the mainland, plus 48 Ambassador Crew sponsored by the teams. Why is China so supportive of the race?

We could have had more yachts from China. We limited it to three. It started with Qingdao in 2005-06 because the Clipper Race was the event they practised on before hosting the sailing competition in the Olympics. It was on a scale we weren’t used to – we were gobsmacked.

We turned up at an event to meet the Mayor and we saw all these
 TV broadcast trucks. I didn’t for one second think any of this was for Clipper – it didn’t even cross my mind. I walked into this huge room and the Mayor was sitting at the head and one side was full of dignitaries, but our side was empty because we didn’t know the scale. I thought we were just exchanging gifts, but it was being televised live. I only had two people with me, our Race Director and a PR person.

The event was televised live throughout China. Their entertainment included their top gymnasts, opera singers, bands … they were basically practising for the Olympics. We went back there in 2008 for the Olympics as guests of the city and we’ve carried on there ever since.

Why has China developed such an attachment to the race?

They’ve named it as the ‘people’s race’ and it hasn’t got quite that price ticket of the [former] Volvo Ocean Race. It does well because it gives a real return on investment.

We have a lot of income from crew members, so we’re not so reliant on a sponsor of a boat to make our business work. Our media figures are very similar to the Volvo Ocean Race, TV wise and so on. An entry for a city is between GBP1 million to 2 million, and the return is 25-fold.

But beyond sponsorship, there’s huge interest within China in sailing in the race.

In the last race, the Chinese participation was the third highest, behind UK and the USA. China had 38 crew. The Chinese teams buy crew places from us and then stage a selection process, creating a programme on TV just for the selection, like reality TV. It can be a bit wacky, but we’ve noticed the standard of people sailing rising each time. 
In the 2013-14 race, Vicky Song became the first Chinese woman to circumnavigate the globe and became a household name in China, all because of the Clipper Race.

It’s remarkable as it really is only in the last 10 or 20 years that China has been opening up. I went to China 40 years ago to buy cane and rattan for basket ware. I’d left school when I was 15, worked in the markets, one thing led to another and I ended up in basket ware. That’s why I first went to China, in 1979, and I was frightened out of my wits. I had a Sony Walkman and a dictaphone, and the police took me away to ask why I had two recording devices. I was only 20. I was frightened out of my life, I’ll tell you.

China has changed beyond all recognition since that time. It has changed beyond recognition in the last 20 years and again in the last 10 years. That’s why we’ve set up a Chinese company, Clipper China, sold 40 per cent of it to Wispark Sports, which is based in Shanghai, and signed an MOU live on TV with the plan to set up sailing hubs across China. The country has taken to sailing. It is one of their directives. It’s a clean sport.

They’re very educated now academically, but they now want to get people off their butts and into sport. They’ve got a huge coastline, but until recently nobody went to sea unless you went fishing.

People underestimate how big the whole sailing industry is. For every boat or group of boats, you need this back-up service for repairs, engines, gelcoats, marine electronics, navigation equipment, sailmakers, all these sort of things that live off the back of sailing and sailing events.

The Chinese are very, very good at looking long term. While they’re creating lots of wealth in other areas, they can afford to put that wealth into other sports and lifestyle aspects to benefit people as a whole.

You can already see more marinas. I went to one with 650 berths and before it had opened, they’d already started the 400-berth extension, and they have another eight marinas planned for that city. There are 200 new cities earmarked for the coast. The rest of the world won’t create 200 cities!

What exactly is Clipper China – a mix of yacht production and sail training?

It’s the whole gambit. Clipper Ventures is the biggest single provider of offshore sail training in the world and over the past two decades, we’ve trained over 5,000 sailors for the Clipper Race. However, the potential for sailing in China means it could take us just a couple of years to train the same number here.

We’re working with the China Yachting Association (CYA), combining forces to bring our offshore sail training expertise to the Chinese sailing industry, which is evolving in an exciting way.

It started off by them needing recognised training with qualifications. I didn’t think some of the other enterprises who were coming in were giving them the right qualifications or training because we’d met a lot of Chinese who came along with sailing certificates, but had no idea.

I believe the RYA is the strongest programme and it’s tough to get registered as a school, because their standards are very high. So, we felt that if the Chinese wanted to do something, it should at least be based on the RYA programme.

Coupled with that, we’re also seeing Chinese citizens paying with their own money to participate in the Clipper Race, not just those who have been selected as ambassador crew.

There’s business potential there because if you take just a small percentage of the 1 billion-plus population, you could potentially have a sailing community bigger than the population of Great Britain.

We also felt we should give something back as China has been such a strong supporter of the race, which is why set up Clipper China. China has plenty of dinghy sailors and people that teach kids, but little beyond that, such as sailing schools for keelboats and offshore boats, and that’s what the CYA wants. They also realise there’s an industry behind it and we’re one of the pieces needed to move this forward.

We had Tony Castro Design in the UK design these two new boats
 – 7m and 12m. These boats will be used in the cities where we teach sailing. Once that’s all up and running, we’ll then create inshore and offshore events in these areas, as well as city-to-city races, then country- to-country races. Beyond that, it’s exhibitions, merchandise and much more.

At the moment, there are races that allow people to participate with no sailing experience. It will kill the sport because it will kill people. It’s a dangerous sport, regardless of training. We’ve had three fatalities in our race over 23 years. It’s three too many, but our overall record is very, very good and the Chinese authorities recognise that.
 We’re pioneers in a sense, but now is the right time. Four years ago would have been too early, 10 years ago, no way, but now there’s interest in China on many levels.

I mean, 40 per cent of Range Rovers are sold in China and the average age of owners is 34. These are the guys who can afford yachts, who will then need crew. It will be a different market to Europe and the US, but as long as we’re flexible, it will work. Hopefully it will work from a business perspective and it will be great to see more people out on the water.

How has it been working with CYA President Zhang Xiaodong, someone who has spent much of her life on water and was the windsurfing silver medallist at the 1992 Olympic Games?

Madam Zhang and Liu Weidong (Secretary General) are both great. They both seem to have grasped a modern Chinese way of doing things and they seem to be hitting the ground running at a time when there’s an interest in sailing and they’ve got the government directives. All of these things have aligned.

Madam Zhang is very good and very passionate about getting people out on the water. She’s very open minded and between us it works 
well. Although we’re a commercial business, we do very well from the sponsorship from Chinese cities, so this is a way of giving something back.

What have you learnt from previous experience of producing yachts in China, having built the fleet of Clipper 68s in Shanghai then the 70s in Qingdao?

Both had their problems. I would still do them again, knowing
 the problems, but one of the reasons we’ve employed a professional production manager with a lot of experience of producing yachts, including in China, is because of attention to detail. It’s keeping on top of production and making sure no corners are cut. It’s in our interest to make sure we don’t let these mistakes happen again.

The workers are skilled enough to make these yachts. The yachts are not super high-tech, but they still need to be perfectly turned out. Because things didn’t work out once or twice, it doesn’t mean we give in. If they can build a smartphone, put rockets on the moon and build nice cars, there’s no reason they can’t build these yachts.

Going further back, how did you come to be Sir Robin Knox- Johnston’s business partner back in 1995. A round-the-world race for amateur sailors could hardly have looked too appealing as a business proposition or been easy to start up?

It was a bloody nightmare! I have to say that if I knew the grief it was going to give me for the first eight years, I wouldn’t have done it. I’m pleased I did it and it has been an incredible roller-coaster of a ride and we’ve come out of it very well, but at the beginning it was the worst decision I’ve made.

A friend called me up to ask me to put some money into a business, told me it would need GBP200,000 and I told him I wasn’t interested because it was sailing. Three months had passed, he was still interested, I still wasn’t, but he asked if I would look at the business model with him. The race had already been announced, applications were in, the boats were in production, but the money had run out.

Robin had done a business model, so I looked at the figures and thought it would need GBP2 million, not GBP200,000. However, I read the application forms for the first race – from doctors, dentists, people that I’d been brought up to show respect to – and I was amazed at the passion.

I had been the biggest importer of cane furniture into the UK, sold that company, then made a lot of money in property, but I was still recovering from being completely wiped out in 1991, having lost many, many millions of pounds.

It was now 1995 and I had built myself back up, but nothing like the level I was at. Anyway, I said to my mate, ‘I think there is a business here and I think it will take GBP2 million’. He said, ‘I think you’re right and I’m not doing it’.

Anyway, I went in and GBP1.86 million got the first race underway. I had to put more money in after that. Later, we floated the company, but as soon as anything happened anywhere else, our share price went down. All our boats were paid for, we were doing well and had a few million pounds, but our company value was half what we had in our account.

We were asking sponsors for big money and they’d do a search on us and find that our company’s worth less than the sponsorship. That got us very depressed, so we bought the company back and just carried on doing what we were doing. We built ourselves up to where we’ve
got 70 or so employees, we’re very profitable, strong and giving huge opportunities out there to people.

You seem to have benefited from not being dependent on a title sponsor.

Our model initially was that we wouldn’t have a title sponsor. We’ve seen other races have a title sponsor – look at Volvo, BT – but when that one big name pulls out, whether it’s in two, 10 or 20 years, that leaves such a void. Our model is that all of our boats are sponsored and our crew entry makes up a lot of our income.

So, we’ve got 700 or so crew sponsors and bigger sponsors like cities and fleet sponsors such as insurance, watch companies. Any one sponsor, even three, could leave without hurting our business.

Our media figures are great, but I don’t think that’s the primary reason for most sponsorships. For cities, it’s an occasion that brings everyone together or for organisations like GREAT Britain to do overseas trade and lots of stuff in different ports.

Which host ports have put on the most spectacular race stops?

The Chinese, for scale, certainly the first ones in Qingdao, because we didn’t know what to expect. In the early days, Singapore put on a reception that featured the Prime Minister and ASEAN ambassadors.

They’re all different, but Derry-Londonderry in Northern Ireland was one of the biggest success stories. We went to Derry, which is war- torn, really, still divided between Protestants and Catholics, and yet when the race was on, Martin McGuinness pulled me to one side and said, ‘Do you realise what you’ve done for this community? Never in my life have I seen these two factions come together as one.’ And this was a yacht race! We got voted best event in Ireland that year. Derry has a population of 60,000 and about 200,000 people came to see Clipper.

www.clipperroundtheworld.com

The original article appears in Yacht Style Issue 48. Email subscribe@lux-inc.com for print subscription enquiries or subscribe to the Magzter version at: www.magzter.com/SG/Lux-Inc-Media/Yacht-Style/Fashion/

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