Case Study Thirteen (UNLUCKY FOR SOME)
Stephen Fitzpatrick’s
‘Go For The Gap’ Capstone (extended version)
“If you no longer go for a gap that exists, you are no longer a racing driver.” – Ayrton Senna
INTRODUCTION
Chris Dixon of VC firm Andreessen Horowitz once said:
“What the smartest people do on the weekend is what everyone else will do during the week in ten years.”
It was a September weekend in 2014 when British entrepreneur Stephen Fitzpatrick, founder of OVO Energy and lifelong Formula One fan, found himself in the stands at the Singapore Grand Prix. Staring across at the inner sanctum of F1, the pit lane, garages, and VIP Paddock Club, he turned to a friend and said, half-joking: “It would be amazing to own a Formula One team. Do you think it’s possible?”
Three months later, he owned one of only 11 teams in the sport.
More than 100 teams have entered F1 since 1950. Nearly all have failed. Ferrari remains the only team to have competed in every championship since its inception.
Stephen saw a gap, and he went for it. His upstart mentality and taste for underdog challenges aligned with the DNA of the sport. It was a Capstone that reached impressive heights before ultimately falling short. Many deemed it a failure. Yet out of the ashes of the Manor Racing experience, a new project emerged, one that led him to become the UK’s first Greentech billionaire and a pioneer in the great energy transition.
This case study is personal. I joined Manor Racing in spring 2016 as Marketing Director, responsible for everything off-track (i.e. anything that wasn’t engineering and car-focused), which meant brand, sponsorships, PR, social media, and hospitality. Here’s the inside track on what we tried to do, the pitfalls, and the learnings.
CORNERSTONE
Born in 1977 in Belfast, Stephen has always been entrepreneurial. At Edinburgh University, he launched a listings newspaper and website. During summers, he went to the U.S. to sell encyclopaedias door-to-door. Many peers struggled with the constant doorstep rejections. Stephen didn’t.
“He was hyper-focused,” recalls long-time friend Jason Walkingshaw. “He worked five times harder than everyone else.”
After university, he moved to London with the idea for an energy startup. But first, he needed capital, so he worked as a trader at Société Générale and later JP Morgan. In 2007, he hit his bonus target in a single day. That was the moment he quit to build OVO.
KEYSTONE
Stephen saw how poorly run the UK’s “Big Six” energy providers were, and how little they did to serve customers. He launched OVO Energy in 2009, naming it after the Latin word for “from the egg”, a nod to fresh starts and new beginnings.
OVO was among the first to remove coal and nuclear from its mix, offering greener, simpler, cheaper energy. A retail-focused challenger, it built proprietary wholesale systems to gain cost efficiencies. Affordable clean energy for everyone, taking on the legacy energy Goliaths.
In 2019, Mitsubishi invested $270m for a 20% stake. In 2020, OVO acquired SSE’s retail business, becoming the UK’s second-largest energy supplier behind British Gas.
It’s important to view the Manor Racing F1 Capstone within the context of this journey, an entrepreneur scaling a billion-dollar company whilst also attempting one of the most audacious acquisitions in sport, funding a team in one of the world’s most capital-intensive arenas.
CAPSTONE
~ How Stephen Acquired a Team ~
Back in 2009, then-FIA President Max Mosley proposed a $54m team budget cap to attract new entrants. Virgin, Lotus, and Hispania joined for 2010, but the cap was never enforced (Mosley was forced to stand down at the end of his tenure that year). Without it, the new teams were left exposed. Hispania and Caterham folded; Richard Branson-led Virgin became Marussia after selling to the Russian supercar company.
The team had overspent and underdelivered. In early October 2014, Marussia driver Jules Bianchi suffered severe head injuries in a freak accident at the Japanese Grand Prix. Later that same month, the team was placed into administration after its backer withdrew support. Nine months later, Jules tragically passed away from his injuries.
Stephen stepped in just before the 2015 season. He realised that by rescuing the team, he could also unlock the prize money still owed from its previous season’s results.
~ Understanding the F1 Model ~
F1’s financial structure at the time was... unusual.
Team revenues came from three sources:
Prize money (including revenues from TV)
Sponsorship
Master Owner funding
But only 10 teams received a full share of prize money. ‘Column One’ payments required consistent top-10 finishes over three years. ‘Column Two’ was merit-based on final standings. ‘Special Payments’ were negotiated for historical teams like Ferrari and McLaren.
This meant smaller teams like ours lived on a knife’s edge, spending millions developing next year’s car without knowing if they’d receive prize money to fund it. It’s no surprise that since 2016, there have only been ten teams competing… In 2026, Cadillac, the US automotive giant, is the first new team to enter the sport since Manor Racing’s demise.
GOING FOR THE GAP: THE UNDERDOG STRATEGY
Our team ethos was to ‘Go For The Gap’, based on the iconic words of Ayrton Senna:
“If you no longer go for the gap you are no longer a race driver.”
It reflected Stephen’s entrepreneurial spirit, and our underdog identity. We wanted to inject personality into the sport and play on our ‘Garagista’ love of racing. There was definitely a gap, as most teams had large corporate sponsors and little leeway to be provocative, fun, or playful. We would dial up the party, bon vivant, visceral elements of Formula One. From playboy James Hunt to Steve McQueen, Lord Hesketh to Eddie Jordan. Mavericks, bon viveurs, swashbucklers and contrarians.
Stephen sold 15% of OVO to fund Manor Racing. In 2016, we had around $54m to operate, enough to race, but not enough to thrive.
The aim was to finish at least tenth, ahead of Sauber, and ideally ahead of unknown quantities like Haas or the financially struggling Force India. Eighth was unlikely but not impossible. For context, the difference between finishing 11th and 8th in the Championship was around $52m in prize money…
Our driver Pascal Wehrlein scored a point in Austria, putting us ahead of Sauber. But at the Brazilian Grand Prix, Felipe Nasr secured a fluke 9th-place finish, bumping Sauber above us.
It was a hammer blow.
The contrast with teams at the top was stark. Ferrari received $180m in prize money despite finishing only third. Mercedes earned $171m for winning, and Red Bull $161m for second. Sauber received $49m. Haas, in its first season, received just $19m, a tenth of Ferrari’s payout.
THE END OF THE ROAD
Stephen had always said he wouldn’t start a season unless the team could finish it. By the end of 2016, we quietly began looking for buyers and investors. Stephen didn’t want to sell another slice of OVO Energy to keep bankrolling the team in 2017.
I remember the final race in 2016 in Abu Dhabi. Stephen requested to be included in the Team Principal press conference, a rare public appearance, and perhaps an acceptance that he might not be a team owner for much longer.
On 6 January 2017, staff and press were notified that Manor Racing had entered administration and was actively seeking a buyer. For many of the team, it was Groundhog Day. We still went into HQ in Motorsport Valley, working unpaid, but still believing in the project, for three more weeks, hoping a buyer or investor would step forward.
There were calls and presentations to consortiums from Austin, Indonesia, and private equity firms in London. Perhaps some of them were doing the due diligence for those who have since invested in teams… Stephen was negotiating hard, perhaps playing too hard ball on price . But nothing was agreed.
On 27 January 2017, the day after my 40th birthday, the team collapsed.
THE NEW ERA
Much has changed since then. Liberty bought F1 from Bernie. Netflix’s Drive to Survive turbocharged a new global fanbase, especially igniting the U.S.
The new Concorde Agreement (the commercial contract that binds together the FIA i.e. the governing body, the Formula One teams, and the sport’s commercial rights holders i. e. currently Liberty Media) distributes prize money more equitably. Cost caps have been put in place. Technical regulations have been adjusted to close performance gaps. Fan engagement and product quality have improved. Teams are treated and supported more like franchises by the sport’s owners now.
But back then, survival at the bottom of the grid was almost impossible.
THE PITFALLS OF CAPSTONING
It’s been relatively cathartic to reflect on the high-pressure days of Manor Racing. I will never forget being in the team HQ, looking down from the mezzanine in the team factory on the army of engineers and mechanics working away in the race bays to get two of the most technologically advanced race cars ready for the next grand prix. Stephen turns to me, gives me one of his infamous intense looks and says:
“There are 225 people here relying on you for their mortgage repayments—no pressure.”
And then walks out of the room, leaving me to contemplate the next move on all things non-car performance for the team.
This was a typical experience. He was a man in a hurry. Fair enough, he was building OVO into a billion-dollar company, gaining millions of customers, dipping in and out of team affairs… Here are some of the pitfalls I found during the Manor / Stephen experience:
The dipping in and ‘throwing grenades’ into Senior Management meetings and then leaving.
This launching of dressing-downs at people led to a blame culture rather than a culture of ideas and innovation at Manor. With such limited resources, people were effectively scared to take risks.
The best word to describe Stephen in F1 was quixotic. Often, he didn’t know the realities, possibilities, or limitations in terms of engineering or performance.
Like many entering F1, they think the magic dust that has worked in their other successful business can rub off and transfer to F1.
Stephen was Head of the team, but there wasn’t a CEO appointed until Thomas Mayer in July 2016. It needed someone to be the bridge between Stephen’s ideas and demands and the team’s senior management.
I think it was underestimated how many smart people were in F1 already. Some hires were from outside the industry, and there just wasn’t time for them to get to grips with the nuances of the sport or execute new ideas and disruptive ways of working.
We were often trying to second-guess his wants/requests. But as he wasn’t there day-to-day, it became inefficient and counterproductive.
There were great ideas around ‘fast-following’ the design of the likes of Mercedes and a focus on finding leapfrogging technologies to outperform the competition, but often they would be cost-prohibitive or require years to execute and deliver results.
To this day, I still haven’t met anyone with such a fast-working brain and a challenger mindset. It was inspiring, if a little daunting. Day-to-day, I believe it’s easier to work with, despite the relentless demands for progress and results. But the half-in, half-out approach, not always easy to get hold of, often full of too many ideas, some not based in reality or feasibility, was tough to sort through.
Ultimately, it wasn’t Stephen’s fault the team failed. In fact, it was resurrected because of Stephen’s bold thinking, and of course it was due to have failed earlier, if it wasn’t for Stephen’s drive and wanting to Go For The Gap.
~ From Failure to Flight ~
That infamous weekend at the 2016 Brazilian Grand Prix, Nasr’s points sealed our fate.
Stephen arrived in São Paulo and got stuck in a four-hour traffic jam. Other, more experienced team bosses had flown over the clogged city by helicopter. From that frustration came the idea: flying taxis. He consulted Manor engineers on materials (carbon fibre, naturally), aerodynamics and crash safety.
From that moment came Vertical Aerospace, founded in 2016.
Stephen began to pivot OVO from retail energy to a distributed, intelligent energy systems business. He was looking at batteries, smart grids, and mobility. From the wreckage of Manor Racing came the idea for electric air taxis.
Today, Vertical is a leader in electric vertical take-off and landing (eVTOL) aircraft. It has flown full-scale vehicles and secured backing from Rolls-Royce, Microsoft, Rocket Internet, Honeywell, and American Airlines, with a $5.4bn order book.
Vertical went public via SPAC in 2021, making Stephen the UK’s first Greentech billionaire.
He told The Times:
“A lot of innovation comes not at the cutting edge of one particular discipline, but at the intersection of different disciplines. So having a broad lens to look at the world means entrepreneurs or businesspeople can sometimes see opportunities that others don’t.”
SUMMARY
Stephen’s experiences at weekends clearly sparked major ideas and pivotal career moments.
Had he not been in Singapore in 2014, he may not have rescued an F1 team. Had he not ‘Gone For The Gap’ with Manor Racing, he may not have been stuck in that smog-filled traffic jam that inspired his next project. If perhaps Manor hadn’t have failed in early 2017, he may not have focused as much of his time, energy, assets and skills on Vertical Aerospace…
He turned the collapse of Manor into a new passion project: reshaping the future of flight.
While Manor is now a footnote in the sport’s history, the experience reshaped the course of Stephen’s future.
While Manor is now a footnote in the sport’s history, it gave rise to something far greater. Stephen won’t be defined only by his Keystone, OVO Energy. He dusted himself off and built again, fuelled by the same belief in technology, energy, and the challenger mindset. The ‘Garagista’ in him won’t rest.