But there was talk about Branson’s strange sexual antics. Crossdressing appeared to be a passion, suggesting something unusually important about Branson’s single homosexual experience soon after his arrival at Stowe. In adulthood, he happily dropped his trousers at parties to reveal fishnet stockings and lacy suspenders; he dressed in women’s clothes and allowed himself to be photographed kissing a man; he performed solo drag acts on the dance floor; and he cavorted naked covered in cranberry sauce. ‘He had this thing at parties,’ recalled Carol Wilson, a senior executive in Virgin Music, ‘of exposing himself all over the place.’ Alison Short, an assistant, was puzzled why he dressed as a woman and was ‘always throwing water over my breasts and rubbing me down’. Regardless of whatever clothes he was wearing, he could rarely resist propositioning women, even those attached to other men. Like a caricature on a seaside postcard, he drooled over big breasted women and few were more amazed by his habit than Tom Newman, the rock guitarist, who stood at the bar of the Warwick Castle, a public house in Maida Vale, with Maggie Russell, his attractive friend, amused by Branson’s unsuccessful attempt to poach. But in 1978, after two years as a bachelor, his fortunes changed.
In starkly similar circumstances to his introduction to his first wife at the manor, he spotted Joan Templeman. The Roman Catholic daughter of a Glasgow carpenter, Templeman had been married for twelve years to Ronnie Leahy, a musician in Stone the Crows whom she had accompanied to a recording at the manor. Leahy would say that the marriage was solid and his wife displayed no hint of unhappiness. Yet Branson was smitten by the Notting Hill shop assistant. The opportunity so close to his home and office was too good to miss. Although upset by Tom Newman seducing his girlfriend, Mundy Ellis, and his wife, and distraught that Kevin Ayers had taken Kristen, he was prepared to entice Joan Templeman, a married woman, by siege.
In Branson’s mind, Joan Templeman, five years older than himself and whose two brothers were well known in local pubs, was ideal. Besides her good looks, she was socially and intellectually unthreatening, comfortably domestic and yet cool. Whenever Leahy was on tour, Branson sought invitations to dinner parties to meet his quarry. Eventually, his persistence was rewarded. Although in late 1977 Branson promised Leahy that he would leave Joan alone for three months to allow the couple to attempt reconciliation in New York, he reneged and flew over, untroubled by Leahy’s distress.
Manhattan was cold and to celebrate their decision to live together, the owner of Virgin headed for the sun in the Virgin Islands. In Branson’s version, he whisked his true love around the idyllic islands on a trip financed by an estate agent to discover his paradise called Necker, an isolated lump of barren rock lacking water, people and animals. Branson would tell friends that the estate agent’s price was £3 million but that he paid just £180,000 to Lord Cobham, the owner. The peer, however, would deny owning the island – Necker was owned by a trust – or demanding £3 million. Branson’s self-esteem was always bolstered by his stories of success. The purchase of Necker imposed a legal commitment to spend a large sum to build a house on the island and provide a water supply. His enthusiasm coincided with his staff, earning by then about £40 per week, voicing fears of unemployment because his company was once again on the verge of bankruptcy.
The following year, 1979, Branson knew that Virgin was ‘virtually bust’ yet, confident about his private finances in the Channel Islands trusts, he bought during the next two years the Roof Gardens in Kensington and Heaven, a popular gay nightclub under Charing Cross Station, using interest-free loans from brewers. ‘Those gays are so neat and tidy,’ he mimicked. Owning clubs excited Branson. He could be the host of a perpetual party, they were useful buttresses for the music business, and Virgin would have a permanent cash flow as a smokescreen against his return to debt. The reappearance of that albatross was the climax of a familiar pattern.
The windfall from the Pistols, the latest Big One, had financed expansion into films, video-editing suites, property, the Venue nightclub, Reggae singers in Jamaica and a music business in America. All of those ventures had turned Virgin’s pre-tax profits of £400,000 in 1977 and £500,000 in 1978 into a projected £1 million loss in 1980. Branson was under pressure from Coutts to repay his debts or declare bankruptcy. Nearly everything, he lamented to his staff, would be offered for sale. To keep up appearances, he sold Denbigh Terrace and moved back on to the Duende, his houseboat.
Gossip in the pop world about Virgin’s closures and staff dismissals was reported in the New Musical Express. Branson was horrified. The truth about Virgin’s financial plight, he feared, would deter Coutts from continuing their loans. His friendly and unruffled upper-class manner, he trusted, would disarm the suspicious. With equal effectiveness his approach charmed journalists, bankers and on occasion even the police. Twice he had been stopped for speeding along the M4 with John Varnom. On both occasions, to escape prosecution, Branson encouraged Varnom to persuade the police that he was seriously ill and allow the trusting officers to escort Branson’s Volvo to the nearest hospital. Varnom continued his performance until the police had disappeared. On another occasion, Branson produced a driving licence to the police belonging to someone else and successfully escaped conviction. Occasionally, he denied he was driving his white Mini, laughing ‘The police couldn’t have seen me because the car’s got blacked-out windows.’ His similarly fanciful tales to his bankers and staff about Virgin’s finances, relayed in his casual style, were protected by similar black-outs and compartmentalisation. Although he knew that Virgin had ‘no money’, he denied that the company was in financial difficulties. In adversity his resilience and methods were remarkable. New Musical Express was threatened with a writ if the magazine did not publish a correction, whatever truth there may have been in the original article.
Rebutting Branson’s denials had become complicated. Under the guise of encouraging individual entrepreneurship, Virgin’s different businesses had been spread in small offices around London, preventing his employees understanding his organisation and blurring his juggling of money between companies. In managing his finances, Branson relied partially upon Chris Craib, a Virgin accountant, to follow his directions on both the administration of his funds and the valuation of his assets to secure ever higher loans from the banks. ‘We’ve spent so much on these things,’ he lambasted the accountant, referring to all the new business he had accumulated by 1981. ‘Surely you can get higher valuations. They’re worth a lot more.’ ‘Nothing more we can do,’ replied Craib, unable to produce the values required to persuade the banks to provide extra loans. To escape that squeeze, Branson’s helpline was his fortune secretly accumulating since 1973 in offshore trusts. Although by law, tax-free trusts could not be used under Branson’s direction, he had little problem persuading the trustees to provide guarantees for a £1 million loan to Virgin from the Bank of Nova Scotia. Virgin was again saved but the lifeline fractured Virgin’s benevolent character. ‘The men in suits have arrived,’ Chris Stylianou muttered as staff and artists were dismissed, property was sold and costs were cut during that year.
Among the minor casualties was Nicholas James of Saccone and Speed, a wine supplier and friend from Stowe who could not recover thousands of pounds from Duveens, Branson’s failed restaurant. ‘I could always get through to Richard until I asked him for my money,’ James would complain. ‘Then he disappeared forever.’
Branson easily lost his sentiment for those no longer deemed valuable to his fortunes. Tom Newman, the whisky-loving recording manager, was deemed dispensable and his stormy departure, abandoning his share options in the manor, passed unmourned.
The major casualty in 1981 was Branson’s relationship with Nik Powell. Branson’s childhood friend urged prudence by terminating the contracts with Virgin’s ‘marginal’ groups, the Human League and Phil Collins. ‘Over my dead body,’ snapped Simon Draper.
‘You just spend all the money I save in the shops,’ countered Powell as the temperature rose. Powell was too cautious, Branson concluded. He had lost his way. The triangular relationship was irreparably fractured.
In Branson’s new world, accountability to anyone was an intolerable shackle. The ‘mumbling pullover’ as he had become known to Varnom, enjoyed working in a team only if he was captain. Since Powell, despite their friendship and partnership, refused to compliantly follow, he was unacceptable. The partnership, they agreed, should be