Robert Buchbauer - Insights and lessons from a broad and varied business career

Few people have enjoyed as varied a career in business as Robert Buchbauer. After earning a Master’s degree in Austria, he went to work for a company in the food industry, where he gained the valuable experience of being, as he puts it, “an outsider inside a family business.” Then, after a spell studying in the us at the University of California, Berkeley, he went from outsider to insider and entered his own family’s business, the world-famous designers and manufacturers of crystal jewellery and objects, Swarovski, as one of the great-great-grandchildren of the founder, Daniel Swarovski.

Early on during his time at the company, in 1999, Robert was tasked with building the brand’s first online store. “This was very early,” he reflects. “Nobody was doing that, at least not in this industry.” Today, e-commerce represents around 20% of Swarovski’s overall business, which shows just how smart that initial bet was, and how well it was executed. He soon became CEO of the consumer and finished goods business, the biggest part of the company, where he took a model that was mainly focused on wholesale and instead put retail at the centre, more than quadrupling the overall size of the business in the process.

In 2020, Robert became CEO of the company as a whole, and steered Swarovski through the first turbulent months of the pandemic (at one point, 90% of its roughly 3,000 stores worldwide were closed). He stepped down the following year to be replaced in 2022 by Alexis Nasard, who was the first executive from outside the Swarovski family to lead the brand. As such, Robert oversaw Swarovski’s transition from a family-managed to a family- owned company.

Today, Robert is vice chairman of the Swarovski board, so is still deeply involved in the family business; however, he spoke to Pictet Report not in this capacity, but in his capacity as a private individual. Alongside his board position, Robert also acts as an investor. Yet he describes his real passion as aviation, and he has set up his own business in this space, which seeks to reduce the administrative burden for those who own business aircraft. Happily, it’s a venture that requires both his deep understanding of the luxury consumer and the business acumen that saw him guide Swarovski through one of its rockiest periods.

When it comes to business, then, Robert has experienced both his own family business and someone else’s; he has worked for himself as an entrepreneur and backed other founders as an investor; and on top of that, he’s worked in the food industry, the jewellery and fashion industry, and in aviation. It’s been a broad and varied career, but he wouldn’t have it any other way. “I like to have a broader spectrum than just one industry, and I always have,” he says. “You could argue that efficiency is usually triggered by focusing and sticking to one narrow route, but more ideas, inspiration and creativity are enabled by broadening.”

One thing is for certain – his background has given Robert a unique perspective on the world of entrepreneurship, allowing him to view it through a range of different lenses. As an entrepreneur himself, he understands both the joys and the challenges faced by founders. “Starting from scratch, you have a lot of advantages,” he says. “Of course, I like that I don’t have to ask anybody if I don’t want to.” But at the same time, he continues, there is the lack of internal infrastructure that forces many entrepreneurs to spend time on frustrating administrative tasks. “You have to make sure things are being done, but without building up huge overheads, because at the beginning you want to concentrate on your service, your product, market and customer,” he says. “Everything else is a burden.”

As an investor, he also has the benefit of a broader perspective, having met numerous entrepreneurs and studied countless start- ups. This wide-ranging experience means that Robert understands some simple truths about young businesses. “Entrepreneurs have to be humble,” he says, “because if we face the facts, more than 90% of ventures fail. A good idea alone is not good enough.”

A lot of hard work is required to create a thriving company, not to mention perseverance. “The same few stories are always quoted, but they don’t reflect reality,” Robert says. “Most successful businesses are built with hard work, sometimes two steps forwards and three steps back. An entrepreneur needs to be willing to go through that. The same is true of investors,” he adds. Success may not come immediately, so, as an investor, you have to not only “believe in the story,” but you need to “draw a deep breath and have some stamina”. At the same time, however, Robert also believes that entrepreneurs need to know when enough is enough. “Sometimes it’s better not to throw good money after bad,” he says. “If you see that your project is not developing according to your plan, you have to be honest with yourself and regularly check whether you still believe you can reach your goal – or would it actually be a better idea to rest, do something different or rethink it all and start over?” Otherwise, he adds, you run the risk of entering into a “never-ending ordeal”.

Finally, the most unique viewpoint that Robert has is that of a decision-maker within a large family business. He has seen first-hand how families, even with the best intentions at heart, make mistakes, and he understands how to avoid them. For him, governance needs to be high on the agenda for every entrepreneur and business-owning family. “The more people who become owners of a business, the more difficult it gets to manage by trust, by shared values and by assuming that you’re all on the same page,” he says. Generally, he notes, you won’t notice this while your company is healthy, when dividends are flowing and there’s growth. “But when times get tougher and the situation becomes tense,” he says, “you find that people don’t share the same vision or have the same exact values. That’s when you need those rules.”

The trouble is, rules need to be agreed upon by everyone and finding that degree of consensus during a period of stress can be impossible. So, Robert’s advice is to mend the roof while the sun is shining: “Do it as soon as possible, because you might run out of time and conditions might become less favourable.”

He suggests focusing on three key areas. First are the rules around how you come to clear and efficient decisions as a family. Second are the rules of employment and succession planning. “I’m not against family members working in the company,” he says, “but the rules need to be clear around how you qualify, what prerequisites you need in order to start, and what kind of training you have to undergo.” He recommends that family members carry out a few years’ mandatory work independently outside of the mother company. “This makes family members better managers at the end of the day,” he says, adding that he believes family members should have to compete with external employees for positions in their business. “The best candidate should get the position,” he says. “That is healthy.”

The third area of focus is the “steam-kettle phenomenon,” as he describes it. “If pressure is building up at the ownership level, you need a valve in order to release that pressure,” he says. “The valve is an exit.” Every company of a certain scale needs an exit regulation, an agreed mechanism for people to exit the company and feel they are getting a fair deal. If you can define governance rules in these three areas as a starting point, he argues, then you’ll be in a far better position when the next challenge looms on the horizon.

When it comes to backing a new venture as an investor, Robert says there is one major element that he looks out for: simplicity. “If during a pitch, an entrepreneur takes hours to explain the benefit of his or her service or product, I don’t invest,” he says. “Good ideas can be explained in a few sentences.” It’s no surprise, then, that – despite his long and varied career – Robert still sees entrepreneurship at its core as a beautifully simple thing. “You need to have an idea, a dream or a goal,” he explains. “You need to follow it and always have it in front of you. And then you have to work hard to achieve it.”