The Entrepreneurs..

 

Innocent was established in 1999 by three university graduates from Cambridge; Richard Reed, Jon Wright and Adam Balon. Fresh out of university, they all went to go onto graduate jobs within large organisations. With already showing their entrepreneurial spirit through part time university projects to earn a little cash on the side, the innocent trio were obsessing whether to start a company together. Four years later, whilst still sharing a house and going on holidays with each other they decided that they either needed to form a business idea or stop talking about it, they gave themselves a weekend to create a concept and Innocent Drinks was formed. The notion of Innocent was born out lifestyle choices, working long hours in London followed by late nights in your 20s meant little room for fruit and vegetable. Innocent wanted to get bring a healthy and convenient way to get nutrition into themselves and others. Starting out as they mean to go on, they invested £500 in 1000 bottles of smoothies and attended a local festival, with a simple concept to test the market, a single question was posed to the festival goers ‘Should we give up our jobs and make these smoothies?’ with two bins, one marked Yes and one No. The Bin Test was the first major milestone for Innocent, and at the end of the weekend, they had sold out of smoothies and a full Yes bin. (Germain 2009)

 

After deciding to stick with the smoothie business, the trio ran into two major problems most businesses face, operations and finance. The trio wanted to create a completely fresh product without the use of concentrates, the trouble was, the manufacturing industry wasn’t ready for this demand back in 1999, with most factories refusing to deal with fresh fruit and only in concentrates and flavourings which was the norm in the soft drinks industry. This demonstrates how committed they were to their goal, even when these industry experts had said no. They finally found their lucky break with one individual who had just came back from Jamaica and was squeezing fresh oranges in wales. This small independent manufacture agreed to take on their business and the commercial process finally began. (Germain 2009)

 

Innocent’s other major hurdle was that of financial, they had been turned down by over 20 banks and had no luck with London venture capitalists. Quoting one VC at the time, it was due to a lethal combination of ‘being too young, all friends, no business experience, no sector experience and competing against the worlds biggest food and drinks manufacturers.’ Although no VC’s would invest, they suggested to the trio that they look for a private investor, and even after pitching at the London Business Angel Network, with over 100 business angels, no one was interested. After exhausting all other avenues and nearly giving up, they tried one last thing, famously named ‘Do you know anybody rich?’ was an email they sent to every address they had. This email received two responses, one from an ex-boss and one from an old work college who knew a man who occasionally made investments. They sent their business plans to both men, and after a following meeting where their idea was rigorously tested, Mr Maurice Pinto agreed to invest, even when no one else would. (Germain 2009)

 

The trio sum up this experience by saying that success is not determined by age or intelligence or even experience but whether you are determined, whether you keep going and ignore those who say it won’t work and prove them wrong.

 

Since then, Innocent has embraced many entrepreneurial and innovative ways as demonstrated throughout this website. Richard Reed has taken a particular focus on youth entrepreneurship through TV shows like ‘Be your own Boss’ and being a key note speaker and role model for many youngsters. We believe that Innocent Drinks are a great example of modern British entrepreneurship and have used innovation throughout their product, their branding and their customer relations to create a successful company. This will hopefully encourage other young people to do the same, feeding into the government entrepreneurial educational policies.

 

 

 

 

The Controversy..

 

 

Although innocent has not been without its controversy over the years. In 2007 Innocent partnered with McDonalds with a five year trial, with much outrage from the Innocent customer base, supporting a company that goes against the very ethos of being truly healthy and sustainable. Many consumers believe that Innocent had sold their soul to McDonalds. In 2012 after their trial, McDonalds dropped Innocent as their consumers failed to warm to the Innocent product, replacing it with an in-house fizzy fruit drink for their Happy Meals. (Marketing Magazine 2012)

 

The biggest controversy is the involvement with Coca Cola. Initially started in 2009, Coca Cola bought shares of 18% for 30million as Innocent required further investment for the survival and growth during the recession. As denoted in Innocent’s book, they had several offers from companies to raise this capital, and Coca Cola offered the best option to retain operational control  and maintain the philanthropic ethos, this decision was not taken lightly but customer feeling were reverberated throughout the innocent community. (Innocent Blog 2009) 

 

Fears were Innocent could lose its identity and no longer be the independent with personality that everyone loved; becoming another mainstream brand in a large portfolio like Copella and Tropicana are for PepsiCo.  In 2010 this deal developed further, and a deal worth 75million saw Coca Cola own 58% of the business and a seat at the board, but the trio still insisted they had operational control over coke. (The Guardian 2010) . On the 22nd February 2013, the final blow was dealt as Coca Cola swallows Innocent up, owning over 90% and becoming the ‘absolute majority’ with a deal worth £100million (The Financial Times 2013). The trio refuses to admit that they have sold out to coke, and state that the agreement would uphold Innocents ethical ideas and promise to give 10% to charity still.

 

Whether this was the right decision, is hard to gauge but what is significant is the continuation of the business model. We believe that the model itself of being sustainable, healthy and philanthropic is far bigger than that of Innocent. If even a small minority of companies within the UK adopt the 10% charitable strategy that Innocent has created this will have a major impact upon society. We believe that Innocent has created a framework which proves businesses can be both commercial and social simultaneously and having these key ethical, social and environmental factors in mind when creating a business in future could change the landscape of business as we know it.

 

Although in no way comparable on the health benefits to Innocent, Coca Cola recently launched ‘Coke Life’ in August 2013 and is currently rolling out this product worldwide. Coke Life is a further developed recipe which is to sit in between the original coke and diet coke ranges. Coke Life has 40% less calories than ordinary coke which uses stevia instead of sweeteners and contains less sugar. We believe that the acquisition of Innocent has benefitted the Coca Cola group and has given the company another lens to observe the market. Although in no circumstances is Coke Life good for you, it is far less sugary and calorie intensive of that of both Original and Diet coke and may aid the ongoing obesity crisis much of the worlds most developed countries are facing. (Coca Cola 2013)