122 | Love & Money: Value Chains, Investment Decks and the 95% Who Aren't Buying Yet with Maurice Doyle
Hendricks obviously is a is a is a great example of that, and it was driven by one of the major shareholders and icon of the industry, Charles Gordon. He had a very similar principle to to you. His view was that brands are built bar by bar, consumer by consumer, retailer by retailer. And he used to share this vision that he had with us on a on a regular, on a regular basis.
Chris Maffeo:In this episode, I welcome back Maurice Doyle. He's been working in William Grant's, he's been working in Bacardi, recently was the CEO of Compass Box. We start with talking about some of these very iconic brands that he's been working with and the importance of aligning bottom up strategies and top down targets so that actually you really walk the talk. The power of saying no, the power of really understanding where to bet your money, where to focus on regardless if you are a big brand or a small brand.
Maurice Doyle:There was a meeting which we had, which it was like, well, we've been doing it for three or four years. We're selling very little. Should we kill the brand? It's a very difficult decision because in the early stages, especially the spirit brand, you're either selling very little because what you have isn't going to work, or you're selling very little because you're building it in the right way, the brand in the right way. And it's a tough judgment when you've got very little data.
Chris Maffeo:I don't want to tell more about this episode. Let's dive in now.
Maurice Doyle:95% of your target market aren't in the market for buying your category at that point in time. And so only 5% of people are in the market at that point in time. And with those 5%, what you need to be doing is driving transactions. But there is still a value in terms of the other 95% about building awareness and building equity. So when they do come back in the market, they do remember you.
Maurice Doyle:And so that's a really important insight to have, but get that alignment between, you can't have part of what you do being top down and part of what you do being brands are built in the bottom up. There has to be alignment in the system. And I think the most challenging thing can often be about just the timings that you're looking to have success in.
Chris Maffeo:This is a great bridge, by the way, on the follow-up question that I wanted to ask you because if you take Hendrix, for example, as a Jenn brand, you've been working there when you were CMO in William Brands. If I remember correctly, you were there in the early days.
Maurice Doyle:The brand was created before I joined, but I was there in the kind of early days kind of scaling the brand up.
Chris Maffeo:And I remember reading a quote from can't remember who it was. Like, there was a lady that was a marketing director or a CMO maybe after you. And she was asked the question about Hendrix specifically, for example. And he said, if it wasn't for the management of William Grant's in that sense, probably if he was in a listed company in a fast moving kind of company, the brand would have probably got dismissed in the first years. And, basically, you're killing a child that then becomes one of the best runners in the world.
Chris Maffeo:So it's super fascinating for me understanding black and white judgment on brands. This is a successful brand. This is a messed up brand. This is a failure. This is a success.
Chris Maffeo:You know? But very often is what you is exactly what you're saying. It's it's timing. The time horizon is what I was saying before about expectations. If the expectation is build the legacy brand that survives generations, you know, you do certain things in certain ways.
Chris Maffeo:If you're creating a a cash cow, you know, you want to milk it in two years. But then again, in today's climate where there's so much diversity in brands, in companies, Can you actually do that? Probably not, in my experience.
Maurice Doyle:Yes. I mean, Hendrick's obviously is a a is a great example of that. And it was driven by one of the major shareholders and an icon of the industry, Charles Gordon. He had a very similar principle to you. His view was that brands are built bar by bar, consumer by consumer, retailer by retailer.
Maurice Doyle:And that's what he used to share this vision that he had with us on a regular basis. And the brand was launched in 1999, well before I joined, and a lot of the hard work was done certainly before I joined. But there was a ten year period where there was no data to suggest it was being successful or not. And they just stuck to their guns. They had a very clear strategy, what they were going to do and what they were gonna say no to, which was the earlier point.
Maurice Doyle:They weren't gonna change. And many times it's like, well, it's ridiculous in the early days, kind of being linked with a cucumber and cucumber serve. Let's go let's go lime or lemon because everybody's doing that. No. No.
Maurice Doyle:That's not what we do. Why are we at a 50% premium to other gin brands? Why can't compromise that? We're not gonna compromise. This is the original vision.
Maurice Doyle:And it required kind of faith. And it did it did link very consistently with the top down objectives and the bottom up plan. And so that's where it worked. It worked very, very well. Even in the stages, when I came on board, it was a bit more data.
Maurice Doyle:It was still a lot going on, feel and faith that were on the right track. And it was really about what we said no to. I was getting a lot of requests about let's go to TV, let's do brand extensions. And and the brand didn't need to do that because there's many people in the target market who hadn't, wasn't aware of Hendrix, hadn't tried, haven't tried the brand at that point in time. On the journey, it was very much about aligning top down objectives to the bottom of plan.
Maurice Doyle:Similar, at the same time was in the company, Monkey Shoulder was just effectively being launched. I remember the early days and it's gone to great things globally. I remember when it was launched and there was a meeting which we had, which it was like, well, we've been doing it for three or four years. We're selling very little. Should we kill the brand?
Maurice Doyle:It's a very difficult decision because in the early stages, especially the spirit brand, you're either selling very little because what you have isn't gonna work or you're selling very little because you're building it in the right way, the brand in the right way. And it's a tough judgment when you've got very little data, which of the two it is. But thankfully we were able by going out in the trade and seeing the reaction to it, you principle about going to a bar, then we're able to see actually there, it is connecting with consumers in a way that traditional whisky brands don't. I remember going, there was a legendary kind of brand ambassador who encouraged me to come out and just see the brand in action. And I remember going and there was an event they were doing and it was about thirty years younger demographic than typical kind of scotch drinkers.
Maurice Doyle:And also men and women and it was an attitude and they were drinking it in in cocktails which at the time was kind of revolutionary and I was there is something here. We have to kind of keep going. Yeah. The leadership and the shareholders were very, very good at grants about aligning objectives with the plan, not having top down objectives and having a bottom up plan. And so I think that's a really vital point.
Maurice Doyle:And that's a principle that people The world is changing on a rapid basis, but that's a principle where I still think applies. Having alignment on the plan and consistency across all elements of the plan is an important thing. Don't have objectives. There's something to your plan.
Chris Maffeo:And building on this, because this goes back to what you were saying at the beginning, the capital challenge world. Do you think that that's one of the drivers like this capital? Well, it's a bit of a rhetorical question because it is. But how does capital a come into play in this? Because you mentioned the 95 to five, which is my philosophy as well.
Chris Maffeo:Everything I'm doing is I've got clients that have been listening to me if the podcast is quite new. But I've been reading my post on LinkedIn for five, six years, and they reach out to be my email now after five years. You know? Why? Because they were not in buying mode.
Chris Maffeo:They aligned with the principles. I've built mental availability with them, but there was no occasion, you know, that was relevant for them to to drink the Maffeo drinks brand. Like, they were drinking gin and tonic, and now they they are after dinner and they want to have a digestive. And now it's my time, for example, you know, to talk in in, you know, occasion term. But we discussed, you know, the misalignment, the bottom up and top down, the but there is also this this thing that there is too much focus on the money.
Chris Maffeo:And I don't want to be naive. I mean, money are a thing. But do you think that maybe there is a wrong way that people perceive the importance of money in building brands?
Maurice Doyle:It's a nuanced answer I have Chris, because I believe that money is a facilitator and with the right plan and the right strategy, having access to the right funds can really accelerate that and working with the right partner can make a big difference. And one of the tensions I think in the world we have at the moment is everything is binary. It's either capital is good or capital is bad. It's, are we in a structural decline in the beverage industry or is it cyclical? And the answer is always, it's a bit of both.
Maurice Doyle:And so I think without the right strategy and without the right attitude, having lots of money doesn't help. But with the right strategy and with the right attitude, having the right funding with the right partner can absolutely help. But I don't believe it's a necessary factor, certainly for startup and even some scale up brands necessarily to have lots of money. It can help, but it's not, it isn't a common playbook going back to what we said. There are things you can do with limited money.
Maurice Doyle:One of the things which I'm always fascinated about is, and it's a real kind of passion point about mine, is just really interrogating. This is something anybody can do without having access to lots of money, interrogating your value chain, really understanding who's doing what, who's getting what, and there should be an incentive for everybody in the value chain to sell your product rather than anybody else. But having that clarity, I know companies where there is huge amounts of money between the gross price and the net price. So what you get at a headline or what you actually get in terms of the bank, often there's very little scrutiny and very little clarity on that. In some companies, the difference between gross to net is bigger than the total A and P, and yet nobody ever talks about it.
Maurice Doyle:And really understanding that and making sure there's a fair incentive for everybody in the value chain, but doing that legwork is something which can unlock a lot of money and a lot of positive momentum. And that's not always easy, it can be a game changer. And I've seen for some businesses how it can be a game changer. That's a good example for me about how you can get growth and you can fuel growth at the early stage without necessarily having money.
Chris Maffeo:I agree. I love this. Let's dive into this value chain piece, because just for the listeners that are not familiar with the financial terminology, can you explain more what those acronyms stands for so
Maurice Doyle:that you Exactly. Can get They're very good points. You sell via other people. In some markets you can sell directly to retailers, be it online or bars or off trade. Often you have distributors who would sell your product in the market.
Maurice Doyle:Sometimes it's legally required like in The US, and then you would have wholesalers who would work with the distributors to get the product to retailers. There needs to be a financial incentive for everybody, you as the supplier, but also for all those parties in the chain to be able to get the product to consumers. And that's what we call the value chain. But being clear in terms of who gets what is an important thing and understanding the differences by market. Sometimes it's the nature of the setup and the legal environment.
Maurice Doyle:It means that different people get different margins, but you can do really interesting analysis. Like in Germany, we work with a partner and they get X percent and in France, we work with a partner and they get Y percent and X and Y are very different. Now, why should that be the case? Should it be X and should it be Y? These are really interesting questions with a bit of curiosity and a bit of analysis that you can do.
Maurice Doyle:So the value chain basically is how you get the products in financial terms from you to the consumer and who makes what at the various stages. And then on pricing, a lot of people would have a headline price, which we would call your gross pricing typically, your gross net value. And then often there would be discounts applied in various forms and promotional discounts, structural discounts. And that would be the money that you get in the bank. That's the money which really matters.
Maurice Doyle:What you might be on an invoice at one level is irrelevant is what you put in the bank that really matters. But understanding the journey from what's on the invoice to what you get in the bank is absolutely fascinating. And from experience, you can unlock riches by doing that analysis. So that's how it works.
Chris Maffeo:Yeah. And to close the loop, so what Maurice was saying, you know, in A and P and t T and E, so travel and expenses and and A and P advertising and promotions or marketing budget, sometimes you think you don't have enough A and P or you don't have enough for traveling and expensive. But actually, you take the money from the left pocket and you put in the right pocket, you realize that there was just an issue with which pocket you had
Maurice Doyle:the money. The trip at the back of the plane to go to The US to see your product and market can be funded by analysis of value chain and just making sure that you're not losing money that you don't know about. And to me, it may be absolutely fine, but having that visibility as a leader, as a founder, as a brand owner, you should know the journey from, on a pricing, how your pricing works in simple terms. You should know it in detail. You should know it well, kind of broadly works like this.
Maurice Doyle:If that's your life, how you get funding from the operations is by the money you take in from pricing. So you need to understand it. It does surprise me at times that people don't understand it enough. So it's a big opportunity for people to understand it better.
Chris Maffeo:I totally agree. And I mean, coming you know, imagine, like, I I came from an agency. I was a sales guy in Rome in the on trade. Then I when I moved to Finland, I was working in agencies. In Sweden, I was working in agencies.
Chris Maffeo:And, you know, when I started, I I entered from the marketing door in in S. V. Miller. And the biggest learning for me was when I became a country manager. And I removed it into the sales, and that's where I understood many of the principles that I now live by.
Chris Maffeo:But the biggest learnings for me was really sitting with the finance team and with the logistics team, with the customer service. Those meetings and I remember myself, and I have witnesses of my ex colleagues that are listening to this. I was one of the salespeople that was spending the most time in back office Because I understood right away that back office is the one that is making or breaking your month, your quarter, and your year. You know? And very often, you don't make the month because a truck has left one day late.
Chris Maffeo:And, you know, like discussing a write off of expired beer. And then if you have a contact in the brewery, that can help you save so much money building on what you're saying that you can put back into the EBIT of your PNL. Mhmm. And and very often, what I'm leaning to is do you think in your experience that in our world, in our drinks world, there is too much focus on I don't wanna call it the fluffy stuff because we are both marketeers at heart, but you know what I mean? The fancy stuff rather than the plumbing of a brand?
Maurice Doyle:It goes back to not living in a binary world and you need both. You absolutely need both. Ultimately, we're not going to be successful unless we connect with our target market. The only sustainable form of growth is consumer led demand. So you, and that's generated primarily via the marketing, the fluffy stuff, as, as, as you've said.
Maurice Doyle:So you need to have that without that, you're not gonna be successful, but in the short term, you're not gonna get there unless you understand how the plumbing works, how everything works. You're right. We've all lived through this short supply chain challenges, the container not turning up, the container being late, the container being stuck in the board. These can have a material impact on your journey. You only get the permission to continue growing for the long term from a marketing point of view, if you really get the nuts and bolts of the business right.
Maurice Doyle:So you have to do both. To be successful, you have to manage the short term operationally being efficient, making the best use of capital in terms of whether it's from external sources or from your own, but ultimately to grow in the long term, you need that consumer led demand. And you don't need to be relevant to everybody, but for your target market, you need to be relevant and differentiated, and they need to build a connection with you.
Chris Maffeo:I agree. And I'm always smiling because the you know, I'm I'm trying to be the advocate of the bottom up. Yeah. Not because I don't believe in top down, but because top down gets a lot of press already. You know?
Chris Maffeo:Top down gets a lot of PR. Fancy things gets a lot of PR. Yeah. And, you know, the the the the people that actually move the product, they don't get PR. And also the the bottom up and the plumbing side of things don't get PR.
Chris Maffeo:Being from Rome, I I'm a I'm a I'm a lover of of history, and and I always I always explain it, like, the difference between Greek cities and and Roman cities. Greek cities were probably more beautiful than Roman cities, But, you know, the Roman cities, they had great great roads, great plumbing, the sewage system, and you cannot live without that sewage system. So the reason why I'm stressing this on the boring stuff or on the non sexy stuff or on the unscalable stuff is that it's very easily forgotten. Because when you live in a beautiful city, you focus on the rooftops and the skyscrapers and the swimming pools, and you don't focus on how the drainage of the swimming pool and how do you secure that the swimming pool has got clean water in it. You know?
Chris Maffeo:This is always the challenge on the polarization nowadays, the black and white, the left and right, and the small and big brands because that's another of these things. And going back to the money issue, the capital that we're talking about now is that there is often, like, a misunderstanding on resources because what is money is subjective. Like, a €500 hotel room may be very expensive and unreachable for most people, but for millionaires or billionaires, €500 is exactly like a €50 motel for a normal person. So do you think that there is, you know, some clarity to be done on this whole funding thing and this whole, you know, approach to money that for example, when it comes to the building bottom up and building, which ultimately means building sustainably and effectively, it's something that is applicable to both small and big brands.
Maurice Doyle:Yes, I do. And just as an aside, Chris, why I love the Maffeo podcast is not only do you get brilliant insights about how to build beverage brands, but you also get history lessons. So I love that. I hadn't thought about it in terms of the difference between Greek cities and Italian cities, but it's very true. And that's that's a bonus you get from from listening to this podcast, everybody.
Maurice Doyle:Yeah. I mean, I think I I I I do think the point on money goes back to why you need money and what you're going to do with it and aligning stakeholders on what the plan is and what the metrics are. And to go back to your point about the importance of the unsexy stuff, at the moment, unfortunately, there are some good beverage businesses that are being challenged and maybe even going out of business, not because the consumer connection isn't potentially strong or there isn't a potential growth plan there, but the plumbing isn't working. Operationally, it's not working as efficiently as it might do. And tragically, run out of money and they run out of cash.
Maurice Doyle:And that's terrible because there were some businesses that are growing, but because they can't fund the growth, they just collapse, which is obviously a real shame. That's why I go back to like, getting a sale of funding good or bad? There's no one playbook answer. It can be absolutely the right thing to do if you're clear why you're doing it and what's your objective behind doing it. And the objective of the people who are coming in giving you money, then you have a aligned plan.
Maurice Doyle:So it can be fantastic and it can be an enabler to growth. And there are some, although some of the traditional players, as I mentioned upfront are stepping back from a funding point of view. There are options out there from a funding perspective, but also if you don't need it, if you can generate the type of growth that you're looking for, maybe aligned with building brands from the bottom up and fund that from your own operations and don't need external funding, that's great too. So there's no one answer. It really depends on your particular situation.
Maurice Doyle:And this is a great,
Chris Maffeo:let's say, clarification. Because first of all, from my perspective, that when I say brands are built bottom up, it's a way of building brands. Yeah. You know, sometimes it gets misunderstood as it's only about bootstrapping or you know, it doesn't matter if it's bootstrapping or VC funded or if it's a multinational brand, you know, multinational company launching a new brand or if it's an old brand that needs to be revitalized kind of thing. For me, it's about building a brand with strong foundations in a sort of a modular way.
Chris Maffeo:Once that you can win in your square mile, then you can go to the next square mile. This is what I think gets misunderstood very often, not only about the brand of brands of Bilt Bromach thing, but in general, not that everything starts with an idea. I remember in the beginning, I used to ask the question, does it start with a brand or with a liquid? I challenged myself in the thinking. I stopped asking that question because someone, can't remember who he was, he said, it starts from an idea, which is a great way of saying, maybe it was even you who said it.
Chris Maffeo:It starts with an idea. But the issue with ideas is that ideas don't start from plumbing. Ideas start from a fantastic vision. I see myself sipping my bottle of spirit beer, gin and tonic, whatever, you know, on a terrorist somewhere. You know?
Chris Maffeo:It doesn't look like, oh, I'm cleaning the vessel after a batch of production. That is the thing that gets forgotten by the brain. You know? And then it becomes an ambition. And then what you were saying before, if you don't put the time horizon into the game, it becomes misleading because it's like, okay.
Chris Maffeo:How can I launch the Maffeo gin and grow it to 10,000 cases in year one? You know? I need to basically spam the market, and I need a lot of money because I need to flush it down the throat of many people in order to reach that objective. But if I lengthen that time horizon and then all of a sudden I say, I want to build a brand that has strong foundations, I don't mind of course, I want to make money because I don't make it for fun, but I'm willing to put some of my money, some of my time into it to grow it for the 95% of the people building what you're saying before. And now I want to gain opportunities with the 5% of the people, but I'm focusing on the 95, not on the five.
Chris Maffeo:You know? And then it becomes a different approach. But when people focus just on the, I want to become a millionaire, I want to exit, I want to do things, All of a sudden, the first thing they think of is like, I need loads of money. So how do I get loads of money? Funding.
Chris Maffeo:And then it becomes, okay. Is it VC? Is it banks? Is it whatever? But then often, like the top down, bottom up dichotomy and misalignment, that is also like a misalignment because maybe you launch it because you wanted to have more time with your family and, you know, I'm one of those guys.
Chris Maffeo:But all of a sudden, like, for example, the choice that I made for myself was I prefer not to have to report to anybody, well, apart from my customers, obviously, put my savings in, you know, and put my time, my almost twenty four seven time, which clashed with I wanted to spend more time with the family, by the way. But at the same time, that gives me the mental flexibility to grow the company in a longer term and in a slower term because I could make much more money if I made different choices. You know? So what is your perspective on this, on giving some tools to people listening to of what to judge when because as we said, there's no right or wrong. Like, it's not VC is bad.
Chris Maffeo:Bootstrapping is good or vice versa. But how can we give some ammunition or asking the right questions to themselves before embarking on a journey?
Maurice Doyle:I think there's a lot to be learned from how you've built the Maffeo brand. So there's a lot of you've demonstrated there is a perfect example of how consistency across the plan in terms of what you were trying to do, timeframe, developing proof of concept and expanding in the right way towards a long term goal. I think that's a great, that there's some great principles behind that. I'm not using the word playbook, but some great principles behind that, that people can learn from. You and I both talk about, maybe we use different language, but the importance of narrow but deep distribution to begin with, rather than trying to be everywhere.
Maurice Doyle:It is much better if you sell and you're relevant to a small number of bars than being everywhere all at once. Selling 10 bottles a week in 10 bars is much better than selling one bottle in 100 bars. In the short term, it's the same amount of liquid, but one is building momentum in the right type of way. So one principle would be definitely develop proof of concept. That's important for you, but if you are looking for an external something, that's something that people will be looking for in your home market, in your home bars, in the outlets that you've chosen as part of your strategy that you want to be relevant in.
Maurice Doyle:And so an early indicator, which is always vital for me is rate of sale data or sales velocity. And so in the accounts that you're in, what's happening to your rate of sale? Is your rates of sale growing? How does it compare to other products which are being sold in an outlet? And so I get very excited, even if the distribution base is quite small, but you're seeing real momentum in terms of growth.
Maurice Doyle:That's an early indicator for me. There's something behind your idea, which you've created. There's some traction there and something which can be built upon. And in the early stages, you need lots of kind of tender loving care behind kind of growing that momentum, but that's a really good So one thing is develop proof of concept and have some metrics in place that gives you a sense of whether you are on the right track. Metrics can be a challenging thing, especially kind of for startup or scale up brands, because sometimes the things you can measure precisely aren't necessarily the right things to measure.
Maurice Doyle:And the things which are semi quantitative sometimes are the things which are the most important. But if you can, it can be hard to get, but if you can get data in the outlets where your home market is, that you are growing rate of sale. And by speaking, by being at the bar, as you'd say, and speaking to the bartenders, speaking to the independent liquor stores owners and hearing them say, yes, there is two people that come in every week and they buy a bottle of Maffeo gin and they tell their friends about it. That gives you a real it's not fully quantitative, but that gives you a real sense that there's something happening. There is momentum being built.
Chris Maffeo:This is one of the misconceptions now that, for example, like, you said, if you're looking for investors, you would be looking for these kind of metrics. But the misconception is that some people probably were told that those people looking to give investments are looking more for how many countries are you selling in, for example. No? And then all of a sudden, sometimes I speak to people, no, and they tell me many countries, and then I say, yeah. But you're selling 80% of your volume in maximum three to five countries.
Chris Maffeo:And then they're like, how do you know? Do you do you have my figures? I said, no. I said, because that's what happens. You know?
Chris Maffeo:It's you know, I don't have your figures, but I I can expect it because if you are in so many countries, you are spreading yourself too thin. And it we go back to the grasping opportunities. Probably you met someone at BCB. You know, they gave you a business card. They bought a pallet, and you've opened a new market, but that pallet is sitting in a warehouse collecting dust.
Maurice Doyle:Yep.
Chris Maffeo:When have they made the second order for the pallet? Oh, they haven't yet. Oh, I've seen that because I've managed export in my previous life, and I know how these things happen. And if you don't have boots on the ground, as they call it, either you have the money for a shared service person or for a brand ambassador or can be a bartender that makes a living on the side. It can be anything, but you need to have someone who remind people of the mental availability and builds their physical availability.
Chris Maffeo:So I feel that the crossroad that you were mentioning before is also driven by a lot of misconceptions that have been built in the last few years. No? Easy money because people were rich on money to buy bottles, so they bought much more bottles that they would deplete. They had cash. They didn't trust the stock exchange because it was very volatile.
Chris Maffeo:They didn't trust certain other things. And then all of a sudden, they said, you know what? You know, my friend is raising money for a brand. You know, I'm gonna gave them 10,000, 20,000, 50,000, whatever. So all of a sudden, like, things have shifted.
Chris Maffeo:And then my question is, okay. But what have you done with the money I gave you?
Maurice Doyle:It's true.
Chris Maffeo:You know? Have you have you used it to build the brand, or have you used it to, you know, to to pay the debts? And ultimately becomes a financial exercise with brand building? Yes, it
Maurice Doyle:can do. I mean, starts off with the idea, as you say, but you're right, there's no easy money at the moment. There is money and less of it than there was in the pre lockdown and lockdown period. And maybe it's better money. It's more informed money and there's more interesting models out there now than they used to be, which is good, but you need to be able to demonstrate you're use, you're using it in the right way and the money that you've used, you've used in the right way.
Maurice Doyle:I've seen many decks. I've probably produced many decks talking about how brands are gonna grow. The one which has the map of the world and how brand decks and every, it's absolutely irrelevant because we've worked for big companies. When you're a big company, if you're in a cardio or the Azure or pan up, you can scale the, if there's an idea there, which has got traction, you can scale the brand much better than Maurice Doyle as a sole independent can, can do. So that's irrelevant to you, but what you are interested in, in the place of the brand is, does it have momentum?
Maurice Doyle:Does it have traction? Does it offer something unique in your portfolio? Is it a premium brand that's gonna help you roll over jackets? And so that's what you're looking for. And so that's an important thing that we are developing that proof of concept is a really important thing.
Maurice Doyle:The other thing, especially in when I speak to founders and CEOs of startups and scaleups that it's very easy to become focused on the exit. That's obviously one of the reasons, hopefully not the only reason, but one of the reasons why people develop the idea or can be one of the reasons. But for me, it's much more interesting to talk about the growth plans for the brands. Now, if that brand or business grows, you will have options. And as part of an option, an exit may be relevant, But don't talk to me about the exit, talk to me about the growth and show how you can deliver that growth.
Maurice Doyle:And that's much more relevant. And that's also what people who have money are looking to hear. They're looking to hear how the business can grow and how their money can grow with it. That's how the world of financing works really.
Chris Maffeo:And that's very true what you're saying because I also see, like, when I'm speaking to people, you know, when I see those lies about the exits, and then all of a sudden, it's like, I'm, you know, I'm talking about investing. Yeah. And you're telling me about exiting. You know? Like, I don't want to exit.
Chris Maffeo:Maybe I want to invest and I want to stay there forever.
Maurice Doyle:Exactly. You know? So what
Chris Maffeo:you know, this is a little bit like my father was from his hometown in the South Of Italy, and he was always laughing when we were going there on holidays. And he would bump in the central square. He would bump into a friend. You know? And he was like, oh, you're here.
Chris Maffeo:When you're leaving? It's like, I just arrived. Why is everybody asking me when I'm leaving? And, obviously, for them, it was like, you know, how long time do we have to stay with you? They meant it nicely.
Chris Maffeo:No? Yes. And it reminds me that you are asking me to invest money into your brands, but you're already telling me what we are gonna do with the money that we get out of the money that I'm giving you, which is totally counterintuitive if you think about it, which if I'm a speculator, then it's fine. But then all of a sudden, are kind of like hijacking the first slides of the deck that is all about the beautiful idea and the concept and the care and love for this brand that you're giving. And then you're gonna you know, like you send you know, you give me the the photo album of your kids, and then you're gonna sell them.
Chris Maffeo:You know? Yeah. So so it's there is this misconception as well that that is like, let's build brands that are growing, you know, sustainably for a limited time number of years. And then we decide what Yeah. What we're gonna do with them.
Maurice Doyle:It gives you options. And and ultimate, anybody who's going to invest is is going to be looking for a return. And so that's absolutely fair. But but if there are people I'm speaking to, as you say, straight away talking about selling the children and that doesn't work.
Chris Maffeo:I'm trying to, let's say, find a way to navigate brand owners now, because what I noticed, I work with big brands as well as, you know, this money issue, what you rightfully said at the beginning, it is an issue. If you have a brand that is selling 5,000 cases in a market, it's still a small brand. You know? But then with your brand, you may imagine you launch a brand that is 1,009 liter cases in a market. You have a local competitor brand.
Chris Maffeo:Technically, you are selling imagine you're selling 5,000. You're selling five x of that brand owned by a big multinational. If you have built a good value chain, what you were saying before, you have money available to be reinvested. Now it's about what you do with those money that makes a difference. Because if you make it on the money only, you know, when that company, the big company is going to realize what you're doing, they're gonna push on the gas, and they're gonna leave you at the traffic lights.
Chris Maffeo:Yep. What do you want to do? You know? Like, acknowledge who you are and what you can do and what are the pros and cons of this. There's a tendency, and I discussed this with other guests.
Chris Maffeo:There's a tendency for, for example, for small brands about this fake it till you make it approach. And I don't mean it badly. I mean it in a they flex their arms to to be perceived fitter than they are. But then, like, they're actually shooting themselves in the foot because if I'm a small brand owner and I go to a cool bar or to a neighborhood bar, if I'm perceived as the cool guy, then they're gonna ask me for money, for listing fees, for retro discounts, for whatever. You know?
Chris Maffeo:If I'm the poor guy that has put all the money and all the savings, you know, they will have a different perspective. So there's a lot of misconceptions that brand owners must navigate in their growth.
Maurice Doyle:I agree. I mean, the way I look at it is gonna play to your strengths. Be it if you're an independent brand or even a mid sized company, and you try to give the aura that you're a really big, then that's not gonna work because there's always gonna be bigger companies that can be better, be bigger companies than you are and bigger brands that can be better at being bigger brands than you are. And also there's all of us as consumers and certainly as retailers and bar owners have a BS monitor that if you're trying to pretend you're something that you're not, they know that. And so I think what is better is just being true to who you are.
Maurice Doyle:And actually they like independent bar owners, independent retailers, all other things being equal, like to support independent brands. And so obviously if a big company comes in with a huge check, they will take that too because they're businesses, but all other things being equal, they will support people with a similar ethos to them. So playing against that narrative, which is not something that you can win as a smaller company and smaller brands on that narrative, much that, and the big companies can't do that. So play to your strengths. Don't try to be what your competition are.
Maurice Doyle:Just try to be the best person of yourself. And I think that's a really important point. I always think that, and this is true of distributors or retail, it's a combination of love and money who they work with. There has to be a financial incentive somewhere because they're a business typically, but the love comes in. Do they enjoy dealing with you?
Maurice Doyle:Do you add value? Are you spending time with them learning about their business? As you would say, being in the bar, listening to see what's happening. And also do they love the product? Do they genuinely think that this is a product that would add value to their retailer, their bar, their shop?
Maurice Doyle:Will it help them grow in terms of either category sales or will it help them grow in terms of reputation? So this combination of love and money is something that is very important. That the bigger companies can typically win because they got bigger budget. But smaller brands and smaller companies can win on the love side.
Chris Maffeo:I love this. I remember your love and money. It's one of my one of the things I
Maurice Doyle:I still advise. Love and money. And just to wrap Sometimes you can have more love and sometimes you need more money, but the two are always a constant.
Chris Maffeo:Absolutely. And it goes well with another quote that I stole from Paul Letko from Few Spirits. He was an emotionally relevant, strategically relevant, or financially relevant. People buy from people. You said it at the beginning.
Chris Maffeo:We know it's a people industry, but often it becomes almost like a fluffy thing. And I don't mean it badly because I believe that it's a people business. That's how we connected. But there must be a systematized approach, which is what I'm pushing for this built bottom up approach because otherwise, you hit the glass ceiling. The love hits the glass ceiling.
Chris Maffeo:The money hits the glass ceiling. You know? If you don't systematize the the yin and yang of love and money and know where to play which, you get lost in translation with customers, retailers, consumers and everybody.
Maurice Doyle:I agree in terms of that. You need to have that process. Love gets you so far, but then you need a system, a way of working that can move you, that can progress. And so that's I fully agree with that.
Chris Maffeo:Fantastic, Maurice. So I want to have a last wrap up from you on, you know, we discussed so many things and some final thoughts from you before we close it.
Maurice Doyle:Okay. Well, really enjoyed the conversation as always, Chris. And I think for us in the industry, it's a fascinating time. It's a challenging time. There is a new reality about building brands in this capital challenged world, but people are still looking for great alcoholic beverage brands that have an idea which is relevant for them and that is distinctive.
Maurice Doyle:So I am still super optimistic about this industry. There isn't one playbook that fits all brands, but there are certain principles which are helpful for people to navigate this new environment and to be successful. And there are tactics that, as you mentioned, that will change as the world kind of changes. But I believe those principles are really important. So it's an exciting time.
Maurice Doyle:And also we've been through these cycles before, you and I, me more so than you, approaching veteran status. Things do get better. It's what you do now that will determine the success going forward. And so that's a really, really important point. The last big thing which you've raised and I think is vital is just this consistency on objectives and plan and timings.
Maurice Doyle:If you can get that right, that's a great foundation to be able to grow your beverage brand or beverage business.
Chris Maffeo:Fantastic. Maurice, that's a fantastic recap of a long conversation that, I mean, I would stay forever.
Maurice Doyle:Me too.
Chris Maffeo:I'm aware of the time of the listeners. Otherwise, we have to make it five episodes. So I hope I'm going to see you soon.
Maurice Doyle:I hope so too.
Chris Maffeo:I'm sorry. We don't know where, but we're gonna bump into each other, and we must plan finally some drinks together.
Maurice Doyle:I look forward to that. Chris.
Chris Maffeo:That's all for today. I hope you enjoyed this episode. If you could think of a couple of people that would benefit from this, please send it to them. And remember to rate the episode if you like it and to subscribe so that you get updates. You can also go on mafaredrinks.com for deep dives and deeper analysis about it.
Chris Maffeo:This episode was fantastic. I think it was one of those episodes that you would save for the rainy days when you feel a little bit down with your brand and you need a bit of a restart and to really understand how to focus on the right strategy, how to really walk the talk, and how to be consistent in what you are doing. That's all for today. And remember that brands are built bottom up.
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