September 11, 2017
Interview with James Averdieck, Founder of Gü and The Coconut Collaborative
This month, we had the pleasure of getting to know one of the UK’s best loved Food & Beverage entrepreneurs, James Averdieck, Founder of Gü Desserts. James goes back a long way with Bluebox as our CEO, Paul Herman, advised James and his business partner on their £35m sale a few years back!! James appears to have the midas touch in F&B and has recently founded the Coconut Collaborative, the ‘on trend’ non-dairy dessert business which is taking the dessert aisle by storm. If you haven’t tried it yet – do so. Great for a healthy treat for the kids!
James has over 30 years experience in the Consumer industry and he shares his knowledge and experiences growing a business from a ‘start up’ to an internationally recognized brand and beyond.
By accident. In the early 90’s, I started working for Safeway in their marketing department. It wasn’t something that I particularly enjoyed as, like any large company it was very corporate and political and I am very un-corporate and political however I learnt a lot about the Food and Beverage industry during my time there.
After Safeway, I went to work for St Ivel for 9 years which is where I really learnt the building blocks to run a Consumer business. I learnt how to develop products to sell into Supermarkets and develop the marketing and branding, that was my apprenticeship for launching my own businesses.
I was living in Belgium at the time which was full of amazing patisseries. There was one in particular that sold excellent desserts and it gave me the inspiration to start to think about setting up a ‘patisserie product’ business and to make it mass market which is where my idea for Gü began.
The next step for me was the biggest challenge, which was actually doing something about the idea which took me over a year. At the time, I was a margarine salesman and I was sick of meeting new people and telling them that so one day, I decided to say that I ran my own chocolate business. As soon as I said it, something clicked in my head and I decided that it was time to make the dream a reality.
Firstly, we had to develop a quality product and the first product we developed was the hot chocolate soufflé. It wasn’t a simple product to make for the mass market but we knew that we wanted the branding to look simple and to stand out from the other brands on the shelf. We hired a branding agency who came up with the initial idea for the black background and the umlauts over the U which was firstly supposed to look like a smiley face but also to give the product a slightly continental/Germanic twist. We felt that what we ended up with ‘did what it said on the tin’, it looked good and it tasted good too.
We were selling Gü at a time in the middle of the recession so Private Equity buyers had left the market and pricing was depressed. Our big challenge was to find a trade buyer who would be prepared to buy the business and see the future opportunity for what it really was. Was there someone that could see quality in a business in spite of the prevailing market conditions.
It was then that we met Paul – your CEO – who put together an auction for the business which consisted of a slick brochure (or investment memorandum) followed by a lot of meetings with potential buyers for the business. Paul was really good at showing us how to present the future opportunities and did in fact advise us to delay for a short while until the business was in the best possible position.
I reckon Paul received interest from over a dozen buyers, but he whittled down the list to one finance buyer and one trade buyer. We were really flattered that so many of the largest names in F&B appeared to be interested. The trade buyer was Noble Foods who were a big egg business that wanted to branch out into the dessert business. They were actually the perfect fit for Gü in the end.
To build a business, you need to know your industry incredibly well and find a trend that is still quite niche and be the leader in that industry as today’s niches become tomorrow’s mainstream. So, whatever you do, be the best at it and then you have got something that is valuable and salable.
When it comes to selling a business, I would suggest engaging an advisor early as the expertise for selling a business is very different to the expertise for running a business. An advisor will make sure your business is prepared for sale so there are no problems when it comes to due diligence and ensure you get the highest price for your business which is where Paul’s expertise came in during the sale process. It is all about presenting your opportunity map in the correct way and also making sure that the business is thoroughly prepared for the onslaught of due diligence.
After selling Gü, I presented a TV cooking show called ‘Cooks to Market’ with Gizzi Erskine. During my time on the show, I saw a lot of businesses with new products being launched and one thing that stuck out to me was that and there were a lot more healthy products being made and consumers were becoming much more health orientated and there was also a strong notion that we eat too much diary.
This gave me the idea for the Coconut Collaborative as there was only one other big player in the market at the time which was Alpro leaving room for competition. I wanted to create a premium non-diary product and I wanted to be the leader in that space which is where the idea came from.
Originally most non-dairy products were all soya based which was not a popular taste amongst a lot of consumers but our niche is that we make non-dairy products taste good.
As mentioned previously today’s niches becomes tomorrows mainstreams and using Tesla as an example (electric cars) who are currently tiny but are now worth more than Ford as consumers move over to electric cars so I am placing a bet that the same thing is going to happen in dairy. From an environmental perspective, cows take up a lot of space, they pollute the air with CO2 emissions so in many ways non-dairy is much more sustainable and better for you from a health perspective. Eventually my plan is that the Coconut Collaborative will be the leader in the non-dairy space as it becomes more popular.
I remember reading about Gerald Ratner who in 1991, infamously told Consumers in an after-dinner speech that his jewelry was ‘total crap’ and consequently wiped £500M from the value of his business overnight. This was obviously not the best piece of advice I’d ever been given but what it did tell me was that you should always cherish your customers, have a great product and make sure it works properly. If you do those three things, you’ve got a chance of winning.
I couldn’t pinpoint one moment but seeing my products selling all over the world, then having consumers telling me that they loved my products and receiving their positive feedback for both Gü and the Coconut Collaborate makes me very proud.
I am obsessive, I have never met anyone in business who is successful that isn’t slightly obsessive – as long as it’s channeled in the right way. I am also quite relentless so I don’t give up easily and I stick with something even when it gets hard. I would also say I am good in a crisis, I get to the bottom of the problem and get it resolved as quick as possible. Finally, I am optimistic about my businesses and I if I have an idea, I go for it.
Probably my Father who had his own business supplying materials to the automotive industry. He was a hard worker and I learnt a lot about business from him.
Quick fire!
What is one of the things you would put on your “bucket” list?
Heli-skiing so skiing from the top of a mountain where I had been dropped by helicopter.
Favorite blue thing?
Blueberry yoGürt.
Chocolate dessert or coconut dessert?
Chocolate flavored coconut dessert!!
Life motto?
Follow your heart.