Ex-'Dragon' leaves lair to reveal secrets of his success

IT IS sunny in Monaco, where Richard Farleigh, millionaire investor, business angel and former "Dragon" on the BBC's Dragon's Den, lives with his family.

Farleigh, (47), an Australian who retired from his career as an equity derivatives trader at the age of 34, will be in Dublin next weekend to tell an audience of investors at Delta Index's annual shindig how he made his fortune - and how they can make theirs in today's turbulent money market.

"I'll be telling people where I've messed up. You learn more when you mess up, than when things go right," says Farleigh, the author of Taming the Lion: 100 Secret Strategies for Investing.

In 2006, the Sunday Times"rich list" estimated his wealth at £66- £120 million (€85-€154 million). Along the way, Farleigh "accidentally" amassed one of the world's largest collections of sapphires. This is not as good, or as Bond villain-esque, as it sounds, however.

"They're stored in a bank vault in America, uncut and unheated. They look like broken pieces of glass, and they're possibly worthless," he admits. Also lurking in his possessions is some 10,000 tennis racquets - "pretty silly" to collect that many of them, he says.

More predictably, Farleigh, who specialises in providing early-stage capital to start-up tech companies, lost out in the 2000 "tech wreck".

So is it fear of taking risks and losing money that holds potential millionaires back?

"No, the more common mistake is for people to think it is too easy," he says.

"Things can look easy, but it's like gambling: the winners talk more than the losers do."

This can be especially true of the high-stakes world of derivatives trading.

"You see people with these PhDs in mathematics make what look like fairly basic mistakes. Interest rates do rise and property prices fall - you wouldn't think you need an education to know that."

He misses his macro-trading days. "I was taking big picture views on things. I see oil prices soaring and gold prices going through $1,000 and I am frustrated that I am not there, not involved. But you do it full-time or not at all."

Farleigh believes the repercussions of the credit crisis will last for "a year or two". For small businesses, it is always tough to get finance. Even the Alternative Investment Market (AIM) companies that he invests in find it difficult, and the credit squeeze means they now have to use their cash more carefully. They're also on the phone a lot more.

"I don't hear from them when things are going well," he says.

Farleigh, who is a chess master, was one of the kinder Dragons on the BBC 2 show and more willing to invest in some of the crazy-but-strangely-brilliant business plans with which would-be entrepreneurs nervously approached the Dragons. He is no longer part of that show's line-up, but gets TV proposals "all the time", he says.

"I've got a couple of interesting things on my desk at the moment, which I think will be fun to watch."

He prefers a more open, more relaxed, more Australian way of doing business than the tense, forbidding theatre of Dragon's Den.

"Often you get the real story out of people at the bar."