Elliot Moss
That’s The Sticks from Cannonball Adderley, I love that particular number. Good morning this is Elliot Moss here on Jazz FM with Jazz Shapers. Jazz Shapers is the place I know you know this but I will say it anyway, it is where you can hear the very best of the people shaping the world of jazz, blues and soul and we bring alongside them a Shaper from the world of business. I am very pleased to say my Business Shaper today is Spencer Hyman; he is the co-founder of Cocoa Runners. You are going to be hearing lots about not just about Cocoa Runners but so many other things that this extraordinary man has done. He has also brought chocolate so we are going to be nibbling on that as well. In addition to hearing from Spencer you will be hearing from our programme partners at Mishcon de Reya some words of advice for your burgeoning business and then we have got the music and it is fantastic today. We are going to be hearing from Kandace Springs, Albert King, The Elder Statesman and this from Norah Jones.
The super lovely sound of Norah Jones with Carry On. You are listening to Jazz Shapers and Spencer Hyman is my Business Shaper today and he is the co-founder of Cocoa Runners, you may not have heard of them now but by 10.00 o’clock you will know all about them and Spencer has done so many other things I am not even going to try and list them here but I am sure we will bump into the world of music, the world of toys, the world of digital, the world of art – everything – Spencer, thank you so much for joining me.
Spencer Hyman
Thank you very much for having me.
Elliot Moss
Now we are going to start at the end, illogically, why not? Tell me about Cocoa Runners? Tell me what it is, why you founded it and what you want to do with it?
Spencer Hyman
So Cocoa Runners is the home of the world’s finest chocolate and what we do is we run around the world finding chocolate makers everywhere from Brooklyn to Budapest, Walsall to Woodstock, Copenhagen to Cleethorpes, Saigon to San Francisco…
Elliot Moss
He’s done that before.
Spencer Hyman
We’ve done this one before but the great thing is that just as there has been a craft beer revolution, there has been a craft coffee revolution, there’s been just about craft everything revolution, there is now a craft chocolate revolution happening and chocolate is something which the Brits do lots of so we actually spend more on chocolate in the UK than we do on books and music combined, almost times two. Twenty five percent of Brits eat chocolate every day and eighty percent of us eat it at least once a week but most of the chocolate we have is very different to what craft chocolate makers do because most of the chocolate we have is actually just cocoa solids combined a bit with vegetable fat, palm oils and all sorts of other things like whey powder. A bit like a chicken nugget if you like whereas the sort of chocolate which these guys craft is much more like a roast chicken or a really great coffee. So it is not like instant coffee it is much more like craft coffee where the beans are carefully roasted, they are carefully ground and in the case of chocolate, you can really taste the differences between for example, you know, different regions of Vietnam or the way in which an American will make a chocolate from a Madagascan bean to the way in which a Frenchman will make a chocolate bar from that and it is just an amazing fun game to run around the world finding these makers and putting them in a box because until three or four years ago there weren’t many people doing it. There were two or three in the UK, maybe twenty or thirty in the States and now there are over three hundred in the States and there are over thirty or forty in the UK and our job is a bit like you DJ great music, we try and DJ great chocolates which we put in a box through your letter box once a month or you can buy them in great coffee shops and great wine shops.
Elliot Moss
Now that’s a very interesting idea but more than the idea but more than the idea Spencer, I am intrigued by your exposition of the market and the opportunity and evidently your granular knowledge of chocolate. It strikes me immediately that you would be someone who researches well, who quickly understands the left and the right, the up and the down of an industry and then gets into it. We are going to cover this in a bit but you’ve done lots of different things and I believe you studied history at Oxford and you learnt Japanese and you’ve worked at Amazon and you’ve brought LinkedIn into the UK , I mean all sorts of incredible stuff. Have you just got a busy mind or is chocolate where you are settling?
Spencer Hyman
I am definitely settling with chocolate. It is very rare you find a product which is… not only tastes better but it is much better for you and it’s much better for the planet. I am getting old now so this is definitely one that I am really absolutely focussed on but I think there is a more general one underpinning it which is you are right when you said about Amazon and stuff like that. The first wave of things which happened on the Internet were all about people knowing what they wanted and searching for them and finding them and that’s what e-commerce is about so physical retail is all about location, location, location. Etail has traditionally been all about search, search, search but there are whole categories of products which traditionally have been very difficult to sell well on the Internet and so wine would be an example, gardening would be an example. There are lots of examples where you need curation, you need some advice and the Internet isn’t brilliant at that because it has basically been a search driven business and the reason why Simon and I got so into chocolate is one, we saw that the chocolate movement was going to happen in the same way that craft beer did and the same way that coffee did but secondly, it is intriguing from an e-commerce perspective to try and grab this new opportunity of what we sort of called curated e-commerce and try and figure out how to crack it.
Elliot Moss
Stay with me for more from my Business Shaper today, that’s Spencer Hyman the co-founder of Cocoa Runners. Time for some more music, this is Mr Albert King with Kansas City.
That was Albert King with Kansas City. Spencer Hyman is with me today; co-founder of Cocoa Runners and a fascinating man because he knows a lot and he has done lots of things in his life. You have mapped out why Cocoa Runners is where you are at right now and I love that idea of curating alongside searching and finding and bringing together both the digital and the real world and I think that is probably where a lot of businesses are going. Just tell me a little bit about your… how you arrived here because in researching you it is evident that whilst we can uncover certain things we can’t uncover everything. Tell me about your journey and how it has equipped you to be now co-founder of a business?
Spencer Hyman
Good question. So I think I have been really lucky in life. So I grew up partly in the North of England, partly in the South. Went to a great University. Did management consultancy for a bit and then decided that I wanted to go into industry. I was really lucky that I got a company Hasbro who let me go and run a toy factory making cabbage patch dolls with a factory manager out in Thailand and then they were keen on trying to figure out how to do more in Asia so I ended up learning Japanese with them, going to Japan, being part of the very early video games revolution doing things like sort of overseeing the team that translated Monopoly into Japanese and then came back to the UK and was fortunate enough to get head hunted by Amazon and launch bits of Amazon software, games and electronics. I think I have been really lucky just to be able to sort of have the confidence and the luck to be able to just do things and find people who are really generous and great so one of the people who I really count as being a fantastic asset and fortunate person to have met is a guy called Reid Hoffman who I met after Amazon when he was setting up LinkedIn and he was actually the guy who put me into Last.fm and I think I have been really lucky in learning from people like that and I have just, I think you know, if you were around a hundred years ago probably what you wanted to be doing was, you’d be doing something like electricity or be doing cars or be doing something like you know, some of the other mechanical stuff that happened then. I think what’s been happening in the last twenty years is that a lot of things have been happening around technology and just by luck through living in Japan at the right time I ended up in that business with a bunch of people who are very creative and very generous and very good at giving back and I think that that is why I have been able to do a few things.
Elliot Moss
Now often, I mean people with your background and it is strong academically and then as you have said you have seen the world in many different way and many different guises. That intellectually doesn’t always translate into then someone being able to go and run stuff or set stuff up. Do you think it has been easy enough over the number of years. I know you have had lots of interesting ventures and so on. How has that bridge happened? How have you gone from the technical intellectual understanding through to ‘okay now we’ve got a business to run’ and the logistics of setting that up because they are quite different aren’t they?
Spencer Hyman
They are. I think the main thing is to learn how to fail super fast and learn how to be willing to take not risks but experiments and just learn what works, learn what doesn’t work and carry on with that and I think that that’s probably the most difficult sort of bit to get through and that’s the reason why having business partners works so well because it is someone who honestly will say ‘when do you give up on this, when do you keep on going’ because a lot of the times it looks as if it is going to fail and then it doesn’t fail. But I think probably the most important thing is to work with people who you respect and learn to fail super fast. Learn to experiment wisely and fail fast. I mean I failed in just about everything I have ever done.
Elliot Moss
I was going to say you look like a failure to me.
Spencer Hyman
I fail a huge amount. I mean we’ve tried lots of different things with chocolates. One of the things we tried with chocolate which you would have thought would work is we want to try and get chocolate to go viral so what we did was in the box which you get four great bars of, we put two little squares or two little bears and we call them ‘Share the Bear’ and so the idea was if you liked this chocolate you would give it to a friend and you would share it – and you are nodding your head…
Elliot Moss
You just eat it.
Spencer Hyman
…exactly right and we failed very fast. It took us about three months to work this one out and we have been ever since then trying to find other ways to get people to encourage people to share this great chocolate.
Elliot Moss
Stay with me to find out how moving on from sharing the bear failing, Spencer Hyman has actually gone on and done some really fantastic stuff with his new business. We have got the latest travel in a couple of minutes and before that some words of wisdom from our programme partners at Mishcon de Reya for your business.
You are listening to Jazz Shapers with me, Elliot Moss every Saturday I am very lucky because I get to meet someone who is shaping the world of business. If you have missed some of the two hundred and fifty almost people that I have had the privilege of meeting then you can go into iTunes and find a whole bunch there. FT.com is another destination, CityAM.com one more and just for fun, British Airways if you happen to be flying in the near future. Spencer Hyman is my Business Shaper today, co-founder of Cocoa Runners, the man that brought LinkedIn to the UK – I said it there in my kind of voice…
Spencer Hyman
I was one of the team who brought it into the UK.
Elliot Moss
…of course you were.
Spencer Hyman
I would never say that I was the one.
Elliot Moss
But part of it and as you said, someone who has been on and off involved in all things digital and how the world of business starts to connect with that. This business now is quite tactile Spencer. It’s kind of…
Spencer Hyman
Quite sensual too.
Elliot Moss
It is sensual, an erotic moment here in the middle of Jazz Shapers. A little earlier you were sharing some chocolate with me, what buzzes you about this stuff? What buzzes you about the business that you are trying to create?
Spencer Hyman
So I think there is three different aspects which buzz me about it. One aspect is the people who grow and craft chocolate are amazing. They really believe it is a different product and they are really passionate about why they do it. So there is a wonderful company called Original Beans who every time Philip Kaufman sells a bar he actually plants a tree in the rain forest so a lot of people go in to Cacao because it is one of the most amazing crops to preserve the rain forest and preserve the planet and the other people who we work with as a whole are absolutely fantastic and the team we have at Cocoa Runners with Lizzie and Angelica and Suey and Catherine and in particular my business partner, Simon, we really you know, that is the key to the partnership. So I think the people are one of the things which keeps it buzzing. The second one of which is it is really, really fantastic to find a product which actually people really enjoy as much as they do and is good for them. So everybody sort of jokes and everybody sort of thinks ‘oh if I eat chocolate it is going to be really bad for me’ but actually if you have this sort of chocolate it is actually really good for you because human beings like having something sweet at the end of a meal or at a certain time and you know, it’s like what do you have after you have had a donut? Another donut. Whereas if you have a good piece of chocolate you savour it and you don’t end up scoffing the whole bar. You will share it with a friend and you will have it over a couple of different days. And then I think you know the third angle to it is it is a wonderful opportunity just to, again, work with and see a bunch of different people in other related industries; in the coffee industry, in the wine industry etcetera and that’s phenomenal.
Elliot Moss
How did you get going at the beginning? I mean was there a whole funding question and if so, what convinced people that they should back you?
Spencer Hyman
So I think how we got going was, and this is the difference between wave one of e-commerce which was all transaction and search based and this wave, in the old days if you were launching, so when we launched Amazon software and video games electronic stores we could rely on search to bring us lots of traffic and we did a few other innovative things. With chocolate nobody really searches for chocolate. I mean the chocolate I have given you whether it be Omnom or Marou or fruition or Menaka, people really don’t know this so they don’t go out searching for it. So what we actually had to do was we had to go to shows. So we do a lot of corporate tastings. We do a lot of tastings at places like Prufrock Coffee, Low Key in Birmingham, Great Western Wines and we started literally by going to chocolate shows, going to wine shows, going to coffee shows and getting people to taste the chocolate and selling the boxes through that and then we would work with people to build email lists and email people and slowly but surely we built it up into a reasonable subscription business and into a pretty good business whereby we actually worked with partners again like Prufrock or like Colonna and Small or Great Western Wines and they act as chocolate DJs now.
Elliot Moss
Stay with me for more about chocolate DJs and the proliferation of the Cocoa Runners dream and it’s a dream which is becoming a bit more than that. Time for some more music, this is The Elder Statesman and the thoughtful Montreux Sunrise.
That was Montreux Sunrise from The Elder Statesman. Spencer Hyman, co-founder of Cocoa Runners is my Business Shaper today. We have been talking about the wave two of the digital commerce world and we’ve been talking about just kind of hard work actually that goes behind getting people to enjoy the new products that you are bringing them. Is it, you know I talked earlier about how smart you obviously are.
Spencer Hyman
I don’t think I am smart at all.
Elliot Moss
You seem pretty smart. But it looks like there is a lot of hard work involved over here Spencer. What advice do you give to people who are also in this early stage of a business? I mean is it more hard work than it is brilliant ideas? Or is it a balance of the two?
Spencer Hyman
So the advice I give, I think one of the nice things about having done this a few times is that you have failed enough to know the advice is definitely find yourself a great partner. I mean that, I cannot stress how important the partnership is and having the right team around you is. I think the second one of which is back to the experiment fast and fail is make sure it is a product which actually people are going to like. I mean one of the key things for us was if you are going to basically make this work, we have got to make certain that people really do believe this chocolate tastes better and then we have got to find a way to get people to know that it tastes better. So we have definitely proven the first. If you give this chocolate, any of the chocolates we have got here to most people, they can taste the difference and it really does work that way. Then actually in terms of actually how do you identify the route to market. That to me is the biggest challenge. What really makes in the tech world a start-up work or not work is how quickly they can acquire customers and retain customers and no matter how brilliant the idea, how wonderful and important it is, if you can’t do what for example, radio did for music; if you can’t get customers, hold on to them, acquire them easily then the business is really going to struggle.
Elliot Moss
Have you had a point in any of the times that you have been doing, you talk about failing and obviously you have got used to failure and you realise failure isn’t a negative, it’s actually the way that you learn. Has there ever been a point where you have gone ‘enough, I am done, I am not doing this anymore’?
Spencer Ryman
Yeah there have been a couple of points when I have done that. I definitely got that way in Asia. There was definitely a point in Thailand when I was making cabbage patch dolls that I just knew that actually running or being an assistant factory manager and running the operation side of it was not what I wanted to be doing anymore.
Elliot Moss
And what did you do about it?
Spencer Hyman
I went to go and talk to my bosses back in Europe and they said ‘Okay we think that Thailand is quite close to Japan’ - it’s really not very close, it’s like about eight hours away by a plane but anyway I wasn’t going to disadvantage them – ‘And we want to do some stuff in Japan and this will be more sales and marketing and so could you go and learn Japanese’. And so they let me go and learn Japanese for a year and I was very lucky and again that’s sort of where I did that. But I think there is a point at which you do have to sort of say ‘Can I actually do this? Is it going to make me happy?’. Also you have got to think about your family a lot too. I think that is super important and I couldn’t do this without my family.
Elliot Moss
Stay with me for my final chat with Spencer today plus we will be playing a track from Kandace Spring, that’s after the latest traffic and travel here on Jazz FM.
That was Kandace Springs with Novocaine Hark and Kandace Springs if you would like to know has just been signed to the fantastic Blue Note Label. Spencer Hyman is my Business Shaper just for a few more minutes and I hope they will be sweet and tasty like your chocolate Spencer, thank you very much. I have been thinking about that for at least three seconds.
Spencer Hyman
Our makers’ chocolate.
Elliot Moss
Yes your makers’ chocolate and that’s really the point about the makers’ chocolate – you have a wide web of people that you are now involved with, different suppliers and you can call them partners or whatever. Different people that say here’s my chocolate, here’s my wares. You have different delivery mechanisms literally around the world that you need to ensure are in place for you to be able to send product to X, Y and Z person that is based out in the States or in Europe or wherever else it might be. That notion of partnership and of ensuring that the people on the ground both creating the chocolate for you and sharing the chocolate with your end customers – very important group of people – how have you identified them and how do you keep them happy and involved?
Spencer Hyman
So there are two. There is very much the customers on the one side and then there is the makers and the growers on the other. So the makers and the growers we get to know anybody who we bring to Cocoa Runners pretty well. We don’t always get a chance to physically meet them. We hope to when we go to chocolate shows in different parts of the world. We sometimes go out and meet them there but we always get to know them so any bar that you find on Cocoa Runners, it’s always the product of what we call direct trade. So in any case the maker will be working directly with the farmer and that is critical because if you want to make great cacao, great chocolate, you need to understand the farmer, you need to work with the farmer to actually make sure that the beans ferment the right way, that they are crafted when they are being dried the right way etcetera and so actually getting to know the makers, getting to know the growers is unbelievably important to us. We literally now run around the world trying to find people who grow great beans and we ask them who they are selling to so we can identify them so for example, a great guy called Bertil Akesson, another great guy called Simran who is from Tanzania, we actually ask them you know, who are you selling to and through that we have discovered all sorts of people in everywhere from Australia through to Columbia who are crafting these beans or South Africa. So that’s one group. The second group, customers – we meet with our customers all the time. I passionately believe in actually doing physical tastings and trying to engage with our customers as much as we want. One thing we would love to do more of actually is use more social media, use more video so that actually we can do this more remotely and actually use some of the tools and techniques that other people are doing much better than we are at the moment in for example, the wine industry, holding virtual tastings and that sort of area. But I think what’s important is that I think that in food as an industry we have seen a lot of sort of narrowing down and sort of bunching down in terms of taste and in music to an extent too and what I love about chocolate is that we will basically be able to give you a bar of chocolate which you know, because it is dried nearer fires because in Papua New guinea or the Solomon Isles they can’t have enough sun to dry the beans in the sun, it will be much more smokey and that’s a flavour which you just wouldn’t normally get in a supermarket brand or you know, you will enjoy how an American will craft a bean differently. You know, how someone like Bryan Graham from Fruition will do it differently from someone like Pra Loup in France and that’s just the fun of it and the experimentation. It’s like with music, you want difference because variety is super important.
Elliot Moss
And variety I was going to say for you personally has been super important too. It is not like you have done one thing or two or three, you seem to thrive on doing many. My last question just before we run out of time and I ask you about your song choices – the future and your focus on this business? I am assuming it is a hundred percent. For how long? Have you got a ‘I know what I am going to do, I am going to create this thing, I am going to disappear’ or is this more than that for you?
Spencer Hyman
No this is, for Simon and I, this is really more. I mean we really genuinely believe that this is a product which tastes better, it’s better for you, it’s better for the farmers on the planet and it’s a huge industry. It’s five billion pounds just in the UK and we are just scratching the surface of it and you know maybe we will do some other food products too, maybe we will do some other areas where you need curation but I really want to carry on working at doing this and working through that but at the same time, helping other people. I mean I have been incredibly fortunate in my life and one of the things I passionately believe and which makes the tech industry work is that you reach out and you help other people and you support them and you try and mentor them and you try and if you can, invest in them or whatever else you can do to work with them. I really believe that that’s the most important ethic that you learn.
Elliot Moss
That’s a nice final thought. Spencer thank you, it’s been great to meet you. Thank you for the chocolate. You are not leaving with it just to be clear.
Spencer Hyman
No I am definitely not.
Elliot Moss
Just before I let you go, what’s your song choice today and why have you chosen it?
Spencer Hyman
So it is by Nina Simone and it’s because I have always loved her music and this one means a huge amount to me and my daughter and our family which is I Wish I Knew How It Would Feel To Be Free.
Elliot Moss
Perfect, here it is just for you. Thank you so much.
Nina Simone with I Wish I Knew How It Would Feel To Be Free, the song choice of my Business Shaper today Spencer Hyman. He said how important it was to fail and fail quickly and learn from those experiences and make sure you experiment so that you can actually understand what will work and what won’t work. He talked about marrying searching and finding with curation and that’s really at the heart of his understanding of how the digital economy works and he talked about the important of generosity and how that informs how he treats people both within his business and all the suppliers that help him create his Cocoa Runners and how it will succeed in the future. Really good stuff. Do join me again, same time, same place, 9.00am next Saturday here on Jazz FM. Stay with us right now because coming up next it’s Nigel Williams.