Naomi Simson’s RedBalloon a real-life shark tank
ONE of Australia’s top female entrepreneurs Naomi Simson is back at RedBalloon — the business that first brought her fame — after orchestrating a dramatic coup.
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ONE of Australia’s top female entrepreneurs Naomi Simson is back at the business that first brought her fame after orchestrating a dramatic coup.
Speaking for the first time about RedBalloon’s shake-up — which saw the departure of the chairman, CEO and entire marketing team as well as her ex, who owned half the business — she told News Corp Australia “there was all sorts of shit that needed to be fixed”.
She also cautioned women against going into business with their husband, criticised the ACCC, which recently hit RedBalloon with the first-ever fine for excessive payment surcharging, and slammed the architect of new gift card laws as the “minister for red tape”.
Ms Simson, who is further known for her role as an investor on TV’s Shark Tank and for having 2.3 million followers on LinkedIn, says her return to day-to-day operations six years after she stepped down as CEO was prompted by concerns about the gift-giving company’s finances, culture, direction and ownership structure.
RELATED: How the Red Balloon coup unfolded
But those who went into the RedBalloon coup have hit back, saying she has over-inflated her claims about its problems and that as a director for all but a few months of its recent history, she carried a share of the responsibility for whatever difficulties it faced.
Ms Simson said costs had increased by a third in the year before she engineered April’s coup as the company made an unsuccessful foray into tourism.
While claiming she didn’t want to blame anyone, Ms Simson said then CEO “Nick Baker came in and he tried to do a pivot into travel. We are famous for gifting.
“I honestly couldn’t stand it.”
But Mr Baker, then chairman Ken Boundy and then director Peter Simson, who is her ex-husband, said Ms Simson was a party to the decision to push into tourism.
Mr Boundy said it was Peter and Naomi’s idea and a key reason why he and Mr Baker were brought into the business. Both had held very senior roles at Tourism Australia.
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Beginning in 2001, with $25,000 in savings and second-hand computers, Naomi and Peter built RedBalloon into an empire turning over $50 million a year.
When they divorced in 2011 she stepped down as CEO and pursued other interests including becoming an investor “shark” on Channel Ten’s reality TV show Shark Tank.
She and Peter each retained 50 per cent stakes in RedBalloon and remained directors.
Ms Simson told News Corp Australia they entered into what she formally called a “cold-war shareholders agreement” that had come to “constrain” the business.
But Mr Simson, who sold out in the coup, said it hadn’t really been a problem and he had never even heard it called that.
She said: “I see a lot of women starting businesses and the first person they turn to for help is their husband. They trust them. But actually they might not be the best business partner in the world. They might not have the best skills.”
This is a marked departure from views expressed in her first book, 2007’s “I Want What She’s Having”, in which she spoke of her then husband’s input and support in glowing terms.
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Mr Simson said: “I think there are many, many instances where fantastic companies have been developed by husband and wife teams. I think its dependent of the individuals. I would always encourage people to look further than the home.”
Of the ACCC fine, Ms Simson said: “It was so clear to me that they knew they would get maximum media coverage with my name,” she said. “There are very few female entrepreneurs let alone ones that are on the telly … and who have an opinion.”
And she described NSW Better Regulation Minister Matt Kean as the “minister for red tape” after he brought in three-year minimum lifespans on gift cards. There hadn’t been proper consultation, she said, and the implications for small business could be harmful.
While those reforms are at a state level, many retailers have made a wholesale change to their cards nationally.