Felix Dennis made hundreds of millions of dollars and wrote one of the most honest and practical books on getting rich.
Keep the shares. Pay talent well. Delegate. Sell before you have to.
He also thought he’d spent too long doing it. Given another shot, he would have cashed out earlier and spent more time writing poetry and planting trees.
This one is built from How to Get Rich. It’s part of my operating manual series breaking down company builders and investors, including Mark Leonard, Andrew Wilkinson, Robert F. Smith, and John Malone.
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Felix Dennis Background
Who was Felix Dennis?
Felix Dennis was the founder and sole owner of Dennis Publishing: Maxim, The Week, Computer Shopper, and dozens of other magazines.
He got his start at OZ, the countercultural magazine whose 1971 obscenity trial made him briefly famous in Britain. John Lennon released “God Save OZ” to support the defense. Dennis later stayed at Lennon’s house while he was recording Imagine.
His first hit was Kung Fu Monthly, a poster magazine about Bruce Lee. It sold over 100,000 copies out of the gate. Dennis got on dozens of airplanes and licensed it country by country, eventually producing editions in German, French, Italian, Swedish, Dutch, Spanish, Arabic, and Chinese. It ran for ten years.
In his fifties, he became a bestselling poet, started planting a native broadleaf forest in the Heart of England, lived part-time on Mustique, and bred rare pigs, occasionally eating them.
He died in 2014.
How big was Dennis Publishing? What’s the history?
- 1970s to 1980s: Builds the business around computer magazines. Launches a US edition of MacUser and sells it to Ziff Davis. Keeps the UK version.
- 1987: Co-founds MicroWarehouse with Peter Godfrey and Robert Bartner. The computer catalog reseller goes public and grows to roughly $2 billion in revenue.
- 1995 to 2001: Launches Maxim in the UK, then the US. The American edition becomes the biggest young men’s magazine in the country, guaranteeing advertisers 2.5 million in circulation. The Week launches in Britain in 1995 and the US in 2001.
- 2007: Sells the US business, including Maxim, Stuff, and Blender, to Quadrangle Group for roughly $240 million. Keeps The Week and the UK portfolio.
- 2014: Dies with a Sunday Times Rich List fortune of £500 million. Leaves the company to the Heart of England Forest charity.
- 2018: His estate sells Dennis Publishing to Exponent for about £166 million, with proceeds going to the forest.
- 2021: Future buys the core of the business from Exponent for £300 million, including The Week, MoneyWeek, and Kiplinger.
How rich is rich?
Dennis opens the book by defining terms. His wealth table, measured by total assets:
- $2 million to $4 million: the comfortable poor
- $4 million to $10 million: the comfortably off
- $10 million to $30 million: the comfortably wealthy
- $30 million to $80 million: the lesser rich
- $80 million to $150 million: the comfortably rich
- $150 million to $200 million: the rich
- $200 million to $400 million: the seriously rich
- $400 million to $800 million: the truly rich
- $800 million to $1.998 billion: the filthy rich
- Over $1.998 billion: the super rich
These are the book’s original 2006 figures, not inflation-adjusted. “Rich” starts at $50 million to $130 million in today’s dollars for Felix.
What does getting rich cost?
Dennis thinks the young, broke, and inexperienced are best positioned. They have stamina and less to lose.
His eligibility test: can you tolerate public failure, long hours, disapproval, and the possibility that your family wishes you’d taken a normal job? Can you treat the whole thing as a game?
“Tunnel vision helps. Being a bit of a shit helps. A thick skin helps. Stamina is crucial, as is a capacity to work so hard that your best friends mock you, your lovers despair and the rest of your acquaintances watch furtively from the sidelines, half in awe and half in contempt.”
He doesn’t promise happiness at the end. What money buys is time and the ability to stop doing things just to pay the mortgage.
The Playbook
Why is ownership the whole game?
The heart of the book is a chapter called Ownership! Ownership! Ownership!
“Ownership is not the most important thing. It is the only thing that counts.”
His examples are two old friends, David and Robin, brilliant publishers at EMAP. On his best day, Dennis thought they would have wiped the floor with him. After decades building a huge business, they left with salaries, options, and pensions.
Dennis made more from deals he could barely remember. Once, he made a million dollars selling a magazine he hadn’t even published.
Then comes the best story in the book.
Four key employees (a senior manager, publisher, designer, and editor) demanded 20% of the company between them. They said it was only fair. They threatened to leave and start a competitor. They had already registered the company’s name.
“I fired them on the spot. Or they walked away. I can’t remember which…”
He was prepared to write the articles, design the pages, answer the phone, and sell the ads himself before giving up the shares. Not for fairness. Not for loyalty. And certainly not because four employees had threatened him.
Their magazine folded. Two came back to work for him. By his later calculation, that 20% would have been worth around $80 million over the next thirty years.
You are negotiating over the company as it exists today. You are giving away a piece of everything it might become.
This is why I tell founders to be default greedy. Dennis is the patron saint of it.
What about partners?
Dennis kept 100% of his UK business, but he happily partnered with Peter Godfrey and Robert Bartner in the US for more than thirty years. They split ownership differently across ventures. Sometimes Dennis was the minority owner.
At MicroWarehouse, he admitted Godfrey did most of the heavy lifting.
He would share ownership with partners who brought real skill and money to a venture. He wouldn’t hand it to employees.
How do you keep talent without giving away the company?
Share the annual pie, not the cap table.
Dennis paid millions in performance bonuses. Managers who improved margins and grew profits could make serious money. A good year didn’t entitle them to a piece of the next thirty.
His rules:
- Make bonuses generous. Tie them to the results you actually want. He once delegated the arrangements and paid ludicrous bonuses for a tiny improvement in profit. Never again.
- Keep overhead down. “Overhead walks on two legs.” Prune it regularly.
- Search out and promote talent. It may be wearing a T-shirt several levels below the people taking credit. Reward managers for finding it. Fire the malingerers and glory hounds.
- Praise real work. Don’t bad-mouth rivals. Take their best people out for a quiet drink. Dennis said nobody ever turned him down.
He paid for perks personally, too. Strong performers could stay at his homes, and employees could use his Rolls Royces for their weddings.
If you keep the shares and pay badly, it’s not going to work.
Why are great ideas overrated?
Tony Elliott of Time Out spent years and a fortune fighting to break Britain’s TV listings monopoly. He won. Then other publishers harvested the market he had opened.
Dennis counted himself among the people who got rich without having a particularly great idea. He cared about implementation.
Kung Fu Monthly was a poster magazine. He got it onto newsstands around the world.
Where is the money?
New and growing industries.
Dennis’s mantra:
“THE WORLD IS FULL OF MONEY. SOME OF IT HAS MY NAME ON IT. ALL I HAVE TO DO IS COLLECT IT.”
The question is which mountain to mine. Dennis would call car dealerships and beer old mines. Don’t go there without a new angle.
He liked growing industries for three reasons: available capital, ignorance, and a rising tide. Investors want in. Nobody is an expert yet. Growth covers a lot of startup mistakes and gives small companies a chance against established operators.
Pick something you have some feeling for. Don’t enter a business you hate just because it looks profitable.
But don’t get so attached to the craft that you forget the goal. Dennis thought he’d done exactly that:
“I became a magazine publisher. That was OK, but I forgot to keep my eye on the ball. The ball was to get rich. Instead, I decided to become one of the world’s best magazine publishers. Not smart.”
How do you raise money without losing control?
Dennis divided funding sources into sharks, dolphins, and fishes.
Sharks were lenders and investors whose terms would eventually eat you.
Dolphins were professionals like venture capitalists. Smarter than they looked, with their own return requirements.
Fishes were friends, suppliers, vendors, accountants, former employers, small investors, and friendly bank managers.
The fishes helped him start and then he funded things himself.
He took furniture from the dying OZ magazine, got free letterhead from a friend, opened a bank account with £50, and sold his review copy records to cover living expenses.
He got a distributor to take a magazine that didn’t exist yet. Two accountants, Brian and Charlie, arranged for his printer to be paid first out of receipts.
He got the magazine made and kept the company.
I wrote more about this in You Don’t Have to Raise Venture Capital.
How did Felix negotiate?
Dennis considered himself a bad negotiator and built rules to compensate.
Set your limits before the meeting: price, conditions, everything. Don’t let the room talk you out of them.
Do the homework. Avoid unnecessary negotiations and auctions unless you’re selling. Send someone else when you know you’re the wrong person to be in the room.
Listen. Then listen some more. Use silence. Find the other side’s weaknesses, not just its obvious strengths.
“Never fall in love with the deal. A deal is just a deal. There will always be other deals and other opportunities.”
Whatever you agree to, honor it. Nobody wants to do business with a weasel.
Why delegate everything?
“I only started to get rich when I began to delegate and to ease up on my work schedule.”
Dennis wanted to write poetry and plant a forest. He’d also realized plenty of people were better managers than he was, and micromanagement scared them away.
Young managers needed room to make mistakes without being crushed for them. He reserved the right to fire people who kept making the same ones.
Two stories he tells about himself:
Guy Sneesby ran his UK web operations and refused to throw money at the internet during the bubble. Wait for growth, match investment to it, and make the business pay. Dennis thought it probably saved him $10 million or more.
Roger in the US did the opposite. He poured money into Maxim’s website because subscriptions were already selling there. He built one of the biggest young men’s portals in North America, funded by the existing magazine business.
The point is the talent, not the strategy. Smart people running their own experiments beat any single top-down plan.
Mark Leonard calls the same thing delegation to the point of abdication.
Finding talent smarter than you is the whole job, and it’s easier when you’re not limited to one zip code. South helps US companies hire senior engineers, operators, and finance people across Latin America. Interview candidates for free.
What kills most startups?
Dennis’s five most common errors:
1. Mistaking desire for compulsion. Wanting to be rich is common. It does nothing. “Desire is insufficient. Compulsion is mandatory.”
2. Overoptimism about cash flow. Run out of cash and you can lose control before you lose the business. You become the minority investor or salaried employee.
3. Reinforcing failure. Continuing to fund something that isn’t working. Owners usually admit failure too late.
4. Thinking small and acting big. Spending like you’ve arrived before you’ve built much. Dennis nearly lost everything doing it himself.
5. Skimping on talent. Saving money on the people who determine whether the business works.
Cash flow belongs in the ownership discussion, not just the accounting discussion. It’s what lets you keep saying no to bad terms.
When should you sell?
Your companies aren’t your babies. They’re tools for acquiring wealth.
Sell while a buyer can still see growth ahead. Don’t extract the last dollar and expect someone else to pay for the privilege of owning what’s left.
Dennis admitted he often held on too long:
“More money is usually lost holding on to an asset than is made waiting for the zenith of its value.”
He also said to sell when you’re bored. Your lack of enthusiasm leaks out and infects the people around you.
Maxim’s print ad pages peaked in 2002. Dennis sold the US business in 2007 for around $240 million.
Quadrangle shut Stuff within two months and Blender in 2009. It defaulted on the acquisition debt and lost Maxim to its lender, Cerberus, in July 2009.
Dennis kept The Week.
This is the opposite of the Mark Leonard playbook of never selling anything. Dennis was a deal guy and an owner, not a permanent compounder. Both approaches minted fortunes. Pick one on purpose.
How do you stay rich?
Keep giving money away. Dennis thought it kept him focused on making more rather than defending what he had.
Don’t lend money to friends. Give what you’re willing to give and forget about it.
Keep your old friends around. They can still tell you when to get off.
No deal is a must-do deal. Walk away when the terms don’t make sense.
Get used to being cut off. Dennis carried no phone and never registered an email address.
What would Felix Dennis do differently?
Given another chance, Dennis would have made enough to live comfortably ($60 million to $80 million to him) by around thirty-five. Then he’d have cashed out to write poetry and plant trees.
Instead, making money consumed his waking hours, delayed his poetry until his fifties, and funded a lifestyle of drugs, drink, and debauchery that undermined his health.
“But like an old, punch-drunk boxer, I couldn’t quit. I always craved just one more massive payday. One more appearance under the lights with the roar of the crowd and the stink of the sawdust and leather. One more fight.”
His advice: “Develop a passion outside of making money. Fast.”
What I took from Felix Dennis
Be default greedy. Found it yourself, fund it yourself, and hire your cofounders. Partnerships can make sense. Giving away equity shouldn’t be the default solution to every problem.
Pay the pie, not the cap table. Big bonuses for people who move margin and profit. Keeping the shares isn’t an excuse to be cheap.
Decide whether you’re a Dennis or a Leonard. I run a holding company that buys to hold, so I’m mostly a Leonard. But Dennis’s willingness to sell is a useful check on the religion. Maxim in 2007 was a well-timed exit.
Mine new mountains. For me, one is venture orphans: good businesses with broken cap tables that nobody else wants to buy. We bought our first one out of bankruptcy. My other is global talent. AI and healthcare are other obvious ones today.
Find the passion outside money now, not at fifty. After some point, we are all just playing a game. Keep perspective. Skip the debauchery.
The line to tape to your monitor, from Benjamin Jowett by way of Dennis:
“Never retreat. Never explain. Get it done and let them howl.”
Read How to Get Rich. It’s the business book I recommend most often to people who don’t read business books.
If you’re interested in buying, growing, and selling small companies, check out my course and community at IndiePE.com.
Know something I should add? Reach out at @ColinKeeley or Colin@ColinKeeley.com. I’ll keep updating this as I learn more.
Continued Reading
• Mark Leonard (Constellation Software) Operating Manual
• Andrew Wilkinson & Tiny Operating Manual
• John Malone (Cable Cowboy) Operating Manual
• Robert F. Smith (Vista Equity Partners) Operating Manual