The innocent co-founder on UK entrepreneurialism
Back in 1999, Richard Reed and two university friends chucked in their jobs in order to focus on their smoothie-making business, innocent drinks. Their pulped-fruit recipes made the company a household name, and their drinks are now sold across the world. In 2010, Coca-Cola upped an existing stake in the business to 58%, making it the majority shareholder. It now owns over 90% of the business.
By the end of 2012 innocent’s turnover stood at almost £200m and the company now employs over 200 people. But instead of just sitting back and enjoying the ride, Reed is a very active player in the business community.
Since founding innocent, Reed has championed entrepreneurialism and sustainable business practice. His latest venture, co-owned by the other two innocent founders, is JamJar Investments, an investment organisation designed to give the next generation of entrepreneurs a boost.
We caught up with Reed at the Waldorf Hotel in Aldwych where he was fresh off stage after hosting the Federation of Small Business’ annual awards show, and asked him about the current environment for businesses and entrepreneurs.
Q. Do you think that business has had something of a public image problem since the recession?
What I think has happened over the last 20 years is that there’s been a massive increase in the amount of attention and celebration that’s given to entrepreneurship. And I think that’s a really good thing because we’ve gone from only feting popstars and football stars to now celebrating business stars, and it’s a good thing to celebrate entrepreneurship and get people thinking about it as an option for themselves.
Unlike being a singer or a professional footballer, which is a tiny and very hard world to break into, all of us can set up a business, so I love the idea of celebrating entrepreneurship. Thirty years ago if you asked somebody to name a famous businessman they would have said Del Boy. Now they say Richard Branson. Business has become a bit sexier, a bit more joyful and a bit more contemporary.
Of course, we still need to round off the sharp edges and businesses do need to take the opportunity to be better citizens in the world, but I would say the trend is definitely positive in terms of attention and appreciation.
Q. There has been increasing focus on wealth distribution in the media recently. Is that a problem for businesses or politicians?
Do I think the world has an extreme amount of inequality? Yes. It’s factually correct, it does. Over the next 50 years we’re really going to have to ask what that means, and if there’s a better way. But I would say that support of entrepreneurship is non-political. Every political party that I know of celebrates entrepreneurship, and quite rightly, because we’re all better off with people taking their lives into their own hands and giving it a go and setting up their own company.
Q. Do you think the government’s been good at sticking up for smaller businesses, in comparison to previous administrations?
For as long as I’ve been an entrepreneur, the UK’s been a brilliant place to be an entrepreneur, and it keeps getting better. When you are an entrepreneur, of the challenges you face, about 99% of them have nothing to do with government and legislation. It’s usually about the team and product and sales. If you sit around blaming the government for the state of your business, then that’s not an entrepreneurial approach. There’s no point externalising the blame. You have to take it on and find a way to solve any problems.
We live in a very pro-business climate. Try setting up a business in India where you need 33 different licences before you can even open for business. Try setting up a company in countries where there is a high degree of corruption. We live in a very stable, low corruption, generally growing macro-economic environment. It’s a good place.
Q. You were talking earlier about companies who had thrived through “singularity of purpose”. You said that while you had lots of different flavours and varieties of drink, Red Bull had grown bigger over the same time-frame with just one drink. How have you applied that principle of “singularity of purpose” to your business since recognising that?
What I was observing was that we might have done better if we’d applied it more. We’ve defined ourselves as healthy drinks, and how we applied it to that is that when we first got going, we were all 26, and trying to raise money. And I was saying to our original investor that we were going to do innocent Healthcare, innocent Body Care, innocent Holidays, innocent Hotels… the focus point is the easy point to get your head around, but you have to decide, what is too much?
If it’s too broad, there’s too little focus. But if it’s too small you might not give yourself enough money to grow. So there is a trick to working out what you’re in the business of. You have to work out exactly what it is you’re doing, and do that better than anyone else. Don’t try and be a shop whilst being a manufacturer.
Q. How does innocent sit with being owned by Coca-Cola now, which doesn’t necessarily have the best record when it comes to innocence?
Well, innocent has always been led by its mission. We exist to get healthy products to as many people and places as possible. And with Coke being the principal shareholder, it basically allows us to follow that innocent mission harder than ever before. And the promises that we made – that it’s always going to be natural, it’s always going to be ethically sourced, with profits going to charity, which are the three big promises which we made when we began – are all going to stay, and then some.
Are they the perfect organisation? Nope. But the people I’ve met have been really smart, really honest and really sincere. They’re also the world’s biggest juice company. In the long run it means that innocent can do more of what we’ve always promised to do, and we’re also providing for our shareholders.
Q. Can you tell me a bit about your new venture, JamJar?
So JamJar is a company set up by myself and Adam [Balon] and Jon [Wright] and its remit is to seek out and support and invest in a new wave of entrepreneurs. We want to find people who are a strong team and have a great idea and can make the world a little bit better. So we’ve got to believe in the people and in the idea of transformation. And if it works it’s got to be net-positive to the world in which it works.
So we’re putting in time, money and contacts, basically what we were eventually given. After a year of fundraising which resulted in a big fat zero, we had no opportunity to start. But one guy took a punt on us and gave us the money, and we want to pass on that business karma down on to the next generation. We’re not a charity; it is investment, but we have to believe by putting that money in that as well as having a good economic model there’s also a good social contribution to it.
Q. Do you think entrepreneurism is innate, or can it be taught?
My view is this: If you’ve ever organised a football match, a holiday with your mates, a band night, a wedding, you’ve got what it takes to be an entrepreneur. It’s about getting a series of people to do a series of things within a certain amount of time and without spending over a certain limit. It’s essentially project management, it’s getting things started.
I really mean it – if you can organise a wedding you can organise a business.
Stop day-dreaming and start doing. It’s easier than you think. Our free e-guide will show you how