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Nestlé, the consumables giant, recently launched Nestlé Hatcher whose “fundamental goal is to work collaboratively with start-ups to identify sustainable and scalable solutions that help accelerate the innovation of products and services to meet local consumer needs.”
In a business venture capital is important, the startups that overcome the tough first few years in business are the employers of tomorrow. Funding is crucial for improving technology, hiring the right people, and launching a comprehensive marketing strategy to get a foothold in the market. However, sourcing enough money to start your new venture can be difficult. Up until the last few years, startup investment was limited to ultra-wealthy and hard-to-access venture funds. Investing in startups is a real driver of innovation for more and more large corporations. Nestlé in partnership with COOi Studios launched the Nestlé Hatcher. This is a ground-breaking, open-innovation platform that will offer innovators and start-up businesses opportunities to work with the food manufacturing company to collaborate to solve some of the current business challenges across the East and Southern Africa Region. The program aims to support start-up businesses and best-in-class innovators with an opportunity to be future Nestlé suppliers.
Today’s business challenges cannot be resolved by a single organisation but through bringing different yet complementary skills sets. Innovation, business adaptability, and strategic partnerships remain the bedrock of business, particularly during today’s challenging business environment.
To get a better understanding of what Nestlé Hatcher is and how it works with and benefits startups, I spoke to João Barreto – Head of Innovation & PMO at Nestlé – and Angel, one of the co-founders of Rum Ratings, an app-based rum community with thousands of rum reviews.
JB: So Brendon, as you were saying, obviously we are doing this to support the startups to grow and to become more. At the same time we’re finding solutions that can help us future proof our business.
This is an important thing because the more startups we have growing and scaling, the more opportunities we’ll have to create fantastic solutions to improve the business and grow to a different scale.
We believe that the whole growth of the ecosystem requires more businesses to do this. More big businesses to invest, more big businesses to support the growth of the startups because the more (startups) we have, the more they can grow, the better solutions we’ll have and we can all grow together.
It’s an opportunity for all of us to grow together and become sustainable over time because even big companies need to innovate and need to bring new solutions.
I think that what we are doing with Nestlé Hatcher is exactly like finding those solutions to help us be sustainable overtime and grow and future proof. At the same time, we can support that ecosystem and help it grow and bring better, stronger and more innovative solutions to the business and corporate world.
BP: What does this actually mean from the perspective of someone who’s already working with Nestlé Hatcher?
Angel from Rum Ratings, could you share how you guys got involved with the platform and what attracted you to Nestlé Hatcher?
A: Coming from the startup world you know basically have to hustle. And you have to look and search and research and reach out and talk to people as much as you can. And during COVID, that’s pretty hard but we did just that. And to João’s credit they had a great promotion around their program. We discovered it randomly online through actively searching and we were like, well, I think we would be perfect for this. We put together a pitch and we said, hey, you know it’s not a far stretch to demonstrate the value and success we’ve had with rum and collate it with coffee. There’s a lot of overlap and there’s a lot of enjoyment of coffee with others. A lot of people may drink it alone, but it’s not unheard of to go to cafes and have conversations just like this one.
We thought we could unify that digital community with coffee and what better partner to have than Nestlé.
Thankfully they thought the same and basically turned our website into an up and coming coffee community that will soon be the largest one in the world and the largest database of coffee in the world as well.
BP: What is the actual benefit that you get from being a part of Nestlé Hatcher?
A: I can only speak for myself, but having seen other co-founders and founders struggling and trying to get to that next evolution of their startup once they’ve met market fit, there’s the question of what you do next. One of the things that I had read about is partnering with corporate entities, and the success that they’ve had.
We would have loved to do it sooner but it’s hard when you’re with your co-founder, elbow to elbow sweating about these ideas and evolving and growing your business.
It’s not only resources that are limited, it’s your time and your expertise. As the founder or co-founder of a startup you’re expected to know everything but you don’t. But, you have to do everything even though you’re not the best at everything. An individual struggle might be that they’re a black belt at development but they’re not good at the business side or they’re not good at the accounting side.
With Nestlé, what was amazing for us is that it’s supplemented all our weaknesses.
For example, João is the head of PMO and we were two developers.
So now we have someone come in to our studios organising us, helping us keep our timeline and helping us define a roadmap together. They brought in a business stakeholder who was talking about the product, the market, and details and strategies, looking at things like the local community and what products they like and enjoy. Things as simple as what marketing wording is the most relevant.
I think it was a perfect marriage for us to bring in these experts and these black belts in these things that we are not necessarily knowledgeable in so that we could really come out with a bang. And that’s exactly what we did, right? We hit all our milestones. We hit all our targets within a short timeframe, and we’re just eager to keep proving ourselves and growing.
BP: OK João, from a Nestlé perspective, what has it been like working with startups, when you’re part of a large global company and have to deal with different needs and requirements in all these varying regions around the world.
JB: Working with startups, overall it’s a completely different mindset. The cultures of big corporations and the culture of startups are different, but the reality is I think we need both sides to meet in the middle. We need to understand each other better and one of the biggest experiences that we had collaborating with startups is exactly that, knowing each other better. But startups have different challenges than we do. For example, in a big corporation, it takes time to approve something, for them it doesn’t, it’s quick. It’s an interesting relationship that we’ve built here, working with startups, and that’s part of building this culture of enabling big corporations, in this case Nestlé, to work with startups.
The second part is being local and working for local is a very, very important point here. When we designed the Nestlé Hatcher, we designed it to be local and for local challenges. That is one of the key things on Hatcher.
The solutions that we need in our region are completely different than, for example, in Puerto Rico or in the USA. So the startups that exist in the USA are not looking at the same challenges that we are looking at here in Eastern Southern Africa. So having the Hatcher being built local for local is a key part of the success we’re having with the program.
BP: It’s very interesting looking at what’s happening on the continent right now in terms of startups and the influx of venture capital investments. Why do you think everyone is now looking towards Africa?
JB: I think it’s coming late, to be honest with you. We have so many successes already on the African continent and so many strong hubs of innovation as well.
Having all this investment coming in only now, it’s kind of surprising to be honest.
In Eastern Southern Africa we have Kenya which, if I’m not mistaken, got $300,000,000 investment in 2020. We have South Africa with Cape Town being one of the biggest tech hubs on the continent. We have Rwanda which is growing amazingly in the innovation space. So there is, in this region, a lot of potential investments to be made and solutions to be brought into the business.
It’s something that I expect to see grow and we, as Nestlé also want to see growth because, as I said before, it’s really important to see the startups growing because we will for sure tap into that growth and bring those solutions into our value chain to help our business to grow as well.
BP: Angel, I am curious about some of the challenges you’ve faced as a startup founder or co-founder and any advice you might have for anyone who’s you know interested in becoming an entrepreneur or starting up their own business.
A: I think there was something that I did have that was very challenging before I came across the rum and the coffee rating angle.
If you’re a startup founder, it’s highly likely that you’ve done a lot of entrepreneurial startups or failed startups or you’ve done things because it’s just in your DNA.
I spoke to a smarter gentleman to myself, from a very successful startup, about the things I was working on and he asked me, “Do you enjoy what you’re doing?” And I was, “I don’t know ’cause I’m looking at numbers, I’m looking at business and KPI’s, etc” and he’s like, “no, no, no, no, that’s not what I asked you. Are you enjoying working on your startup?”
The answer was no and I hated to admit it at the time. That I was not enjoying myself working on that thing that I was working on at that time.
And his response was, “that’s your biggest problem.”
If you find something that you can take your skill with, something you enjoy, it doesn’t matter if eventually you exit and you’re worth millions of dollars. The point is that you enjoy the journey to get there, and if you don’t enjoy that journey and you sold that whatever product it is,that’s great, you’ll have your yacht, but you just gave 5 to 10 years of your life on something. You can’t get your life or your time back.
When he said that I was able to resolve that issue. And now I’m pursuing rum and coffee, two things I genuinely enjoy. It’s enjoyable to learn about all these different variances working with João and his team. It’s very very enjoyable. So I think even though I’ve resolved that problem now, that was one of the major problems I had early on in this startup world.
BP: Angel, were there no concerns about aligning your startup with a big company like Nestlé.
A: My partner and I don’t always agree. And, and that’s not a bad thing, right?
A lot of people think disagreeing or having challenges, especially in the startup world is a bad thing and that you should just agree on everything and move forward. That’s not likely when you’re doing things that have never been done before. So to that point, yes, there are going to be challenges, just like any relationship.
We got pushback on things that we didn’t think about, and unless they pointed it out, it never crossed our mind. When we had that pushback and those challenges, we took it as it generally was, a good intended challenge to us to improve or do something a certain way.
If you go in open minded, those challenges that you will have are actually beneficial in the long run.
BP: João from your perspective as a big corporation, what is it like working with these startups?
JB: We decided to invest in Nestlé Hatcher exactly for that reason, agility. We have our core business which is that we are very good at developing fantastic food, but the reality is we also don’t know everything. We are not experts in everything and as a big company we require agility to be incorporated into our business. That’s something that the startups can bring to us.
Startups and their culture of finding new ways of doing things is something that we as big corporations are looking for.
The environment is moving so fast that we need that agility. We need to be faster in doing things. Take Rum Ratings for example. It took us seven months to do the whole process from sourcing to pilot, which is amazing if you think about it, it’s really a quick way of bringing new innovation to the business.
The importance of investing in Nestlé Hatcher is to help us futureproof and find the best solutions out there and ensure that the communities where we are can grow with our support as well.
(Text edited for clarity)
Featured image: Nestlé Hatcher