He is such a lovely guy. It’s hard to believe that the company featured in our first ever issue of SoftDrinksWorld (now Beverage Innovation), and he kindly said how we gave them their first big break by writing that first article (‘Smooth Operators’) and putting them on our front cover.
After a friendly hello to everyone, he gave a six-point schedule on how to set up a business and help it succeed.
He continued: “Business is simple really. You need people (not your friends and family) to pay the price and pay it again. That’s all business is. Once you have your idea, don’t change it radically and become too broad. It’s better to do lots of small things well.”
In the Q&A that followed, the first question was from an entrepreneur on how to cope with the gut-wrenching fear that you feel at two o’clock in the morning. A good question!
“We have all those fears in the middle of the night, and often it’s self created,” said Reed. “Don’t say nothing bad is going to happen because sometimes it does, but do say ‘I can handle this’. Part of being an entrepreneur is to keep going; keep fighting.
“There were three times in the past 15 years when we thought we were going under. Initially, when we began, we had so many rejections from potential investors. One bank said we ticked every box in the ‘who not to lend to’ column. We were young, we were inexperienced, we were friends.”
Richard quoted from Warren Buffet, who said, Just because you lose an argument does not mean you are wrong.
He also quoted Gunther, the head of a German rowing team, who said, Every decision has to have the team at its heart. Whether you are eating at home or running a marathon; ‘Will it make the boat go faster?’ – keep your core goal in mind.
The second time was when the company who supplied Innocent’s clear PET bottles suddenly had a big order and could no longer supply them: “We found some ready-made bottles,” said Reed, “but then had to stay up all night capping the bottles by hand as the capper on the line we had didn’t work with this format.”
And the third time was the economic crash in 2008, when the bottom dropped out of the market: “We had a major pitch for more capital on the day that Lehman Brothers collapsed,” he said. “We were in debt, sales were in free-fall and we thought we were doomed.”
And the Coca-Cola buy out? “These guys were well informed,” he said. “They were picking up on the trend to natural health and wanted a juice offer in Europe. Of all the guys we met, they were the smartest – the most honest – and they respected the brand.
“Our first angel investor did well. He put in £250,000 and walked away with £30m.”
And one final piece of advice? As Richard explained: “As entrepreneurs, we are hardwired to be ‘yes’ people and we can get sidetracked by new ideas, so you need to stay focused. Saying that, you should alter your strategy if something isn’t working – just not your goal.
“Ultimately, it’s about working for yourself. The universe starts to make sense if you start a business, and I would always favour an entrepreneur, as it shows grit, determination and enterprise, even if it fails. But I wouldn’t advise going it alone, even if you make a heap of money. It’s not much fun rattling around in a big, empty house all alone. Life is about our interaction with other people. If you look back, those are the good times.”
Right now, Richard Reed is busy with JamJar Investments, backing entrepreneurial ideas, one being an energy lagoon project harnessing the tides in Cardiff Bay. He also runs the Reed Page Foundation, recently backing a young sportswear fashion designer. You may have seen the programmes on TV. He’s also still on the board of Innocent and is passionate about the use of recycled PET.
And the drinks? Well the mixed juices have been a runaway success, growing from a value of £4m to £75m in just two years following the move into PET carafes. The company is established in 16 countries in Europe and now has plans for Russia and Latin America.
Richard Reed is an inspiring man. We are so proud of the success of Innocent Drinks and so glad we have known him for the whole time we have been publishing. Who knows what he will be doing next? You can be sure we’ll be keeping you up to date.
Listen to our audio interview to hear more about his current plans …
.
© FoodBev Media Ltd 2024