Jim Koch is a sixth-generation brewmaster who quit a six-figure consulting job to launch a business.
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00:00When I started Samuel Adams, I used a family recipe.
00:04It came from my great-great-grandfather's brewery
00:07in St. Louis in the 1860s, 70s, and 80s.
00:12My dad had actually brewed that beer
00:15when he was a brewmaster in Minster, Ohio,
00:19and the brewery was declining.
00:21It was trying to compete with much, much bigger companies,
00:24so my dad made something that nobody else was making.
00:28The owner of the brewery told my dad,
00:31Charlie, this is not what people want today.
00:34This has got way too much flavor.
00:36What people want today is water with foam on the top of it,
00:40so dump this and go back and make me water with foam on it.
00:45I'm Jim Cook.
00:46I'm 75 years old.
00:48I'm the brewer and founder of Samuel Adams,
00:51and these are my secrets to success.
00:53I grew up in Southern Ohio,
00:55and my mother was an elementary school teacher,
00:58and my father was a brewmaster,
01:01so I'm actually the sixth-oldest son in a row to be a brewer.
01:07My first job was, when I was 12 years old,
01:09it was actually delivering newspapers.
01:11I went to Harvard.
01:13I was a government major.
01:15After college, I entered the JD-MBA program
01:19at Harvard, Harvard Business School,
01:21and Harvard Law School,
01:23and I did the first two years of that program,
01:26and I realized, I'm not sure I wanna do this.
01:29I'm not sure I wanna be a corporate lawyer
01:31or go to a big company, so I dropped out,
01:34and I spent three and a half years
01:37working at Outward Bound, running wilderness courses,
01:41and after three and a half years,
01:42I decided, all right, I'm ready to go back.
01:44Completed the course and went from there
01:47to Boston Consulting Group.
01:49After seven years at Boston Consulting Group,
01:52I realized that I probably didn't wanna do that
01:56for the rest of my life, and then I realized,
01:58well, the rest of my life starts tomorrow,
02:01so I went in and I gave my notice.
02:03I thought, what I really wanna do
02:05is what my family has always done, which is make beer,
02:09and so I told my dad I was gonna leave this pretty good job
02:13to start a small brewery.
02:15He looked at me and he said,
02:16Jim, you've done some stupid things in your life.
02:19This is about the stupidest.
02:22The whole idea of small-scale brewing
02:24and trying to make a living was unheard of.
02:27I explained to him, look, Dad,
02:29I'm not gonna compete with these big brewers.
02:31They will kill me.
02:32I get that.
02:33I'm gonna start something totally different.
02:36I'm gonna make really high-quality beer
02:39like nobody is making in this country,
02:40and he understood that.
02:42He understood what great beer was.
02:44After I had a recipe, I needed a name.
02:48I wanted a name that would be assertively American.
02:52I wanted to be very proud
02:55about brewing great beer here in the United States.
02:59Nobody knew who Sam Adams was until he became a beer,
03:03but historically, Samuel Adams
03:06was the original revolutionary.
03:09He antagonized the British.
03:12He was a propagandist.
03:13He stirred Boston up against the British troops.
03:16He was a revolutionary,
03:18and I wanted to create beer independence for America
03:22in the same way that Samuel Adams
03:25and the rest of the patriots and founding fathers
03:28created political independence.
03:30Honestly, starting Samuel Adams was easier than it seems.
03:36I didn't have much money.
03:37I raised $140,000 from friends and family.
03:42I didn't need a whole bunch of people
03:44and I had $100,000 of my own money.
03:47It wasn't bootstraps.
03:48We didn't have bootstraps.
03:50It might've been a shoestrings
03:53because when I started, there were only two people.
03:56We didn't have an office.
03:57We didn't have computers.
03:59My dad gave me some good advice when I started Sam Adams,
04:03and he told me, Jim, when you start a company,
04:06it's kind of lonely,
04:08and it's really much better if you have a partner,
04:13and it's very much better
04:15if that partner is different from you.
04:18I kind of looked around Boston Consulting Group,
04:20which had extraordinarily talented people in the 70s.
04:24People like Mitt Romney was there.
04:26Benjamin Yet-Yahoo was there, but they were all like me.
04:29They were all over-educated white guys
04:32who lived in the suburbs.
04:33Then I realized, wait a minute.
04:35I think I know the person
04:37that I want to go on this journey with.
04:41Her name was Rhonda, and Rhonda was my secretary.
04:46She was great at balancing people, management,
04:51accomplishing tasks, follow-up,
04:55all the things that I wasn't particularly good at,
04:58and Rhonda bartended at night,
05:00so bars were kind of her natural habitat,
05:03and that kind of gave us a full set of skills.
05:07My first hire was my best hire.
05:10It became very clear to me
05:11that there were only two things
05:13that we needed to do extraordinarily well.
05:16One was we need to make a great beer.
05:18That was proved when we got chosen
05:21as the best beer in America,
05:23an honor that we went on to win four years running.
05:27So that was very cool.
05:29This little company, two people,
05:31was making the best beer in America in Boston.
05:35We had to work our asses off to sell it.
05:38I just put cold beer in my briefcase
05:41with those blue cool packs.
05:44I could get seven beers, two blue cool packs,
05:47and a sleeve of cups, and I went from bar to bar
05:51and tried to get bartenders, bar managers, owners
05:57to taste my beer and to put it into their bar.
06:02I never thought Samuel Adams would be this successful.
06:06My original business plan was
06:08that we would eventually grow over five years
06:13all the way up to a million two in sales.
06:17We would be eight people,
06:20and after five years, we would plateau.
06:23And it's 40 years later,
06:25and we're not a million two in sales.
06:28We're over two billion, and we're not eight people.
06:31We're 2,800 people,
06:33and we're still continuing to innovate,
06:37bring out new products, and grow.
06:40So I believe my job as a business person
06:43first is to try to pay back, pay forward,
06:47share the wealth, however you wanna say it,
06:49because at the end of the day,
06:50if you're the only person who benefits from your success,
06:54you're not gonna have much of it.
06:56In 2007, we got our management team together,
07:00and we went to a community center in our neighborhood,
07:03and we painted the community center.
07:06And it was one of those feel-good things.
07:09And I remember walking back to my car
07:12and not feeling good about it.
07:14And I was wondering, why am I not feeling good?
07:19We just did this really nice thing,
07:22but I don't feel good about it.
07:23And I realized I don't feel good about it
07:25because I'm a business.
07:28I'm a business person.
07:30What I do is create value.
07:32And I just spent about $2,000 worth of management time,
07:38and we did about $500 worth of crappy painting.
07:42So I did not create value.
07:45So we came up with the Brewing the American Dream program
07:49out of my experiences starting Samuel Adams.
07:53Because when I started,
07:55there were two things that I didn't have access to
07:58that would have been really nice.
08:01First was loan money.
08:03I raised equity, but nobody would loan us any money.
08:06I went to four different banks,
08:08and finally one of them just said,
08:10Jim, nobody's gonna lend you money.
08:11We're a bank.
08:12We don't like taking risks.
08:14And your company is ridiculous.
08:18We're never gonna get our money back.
08:20And the second, which was much more important,
08:22was coaching and counseling and advice.
08:26When I started Sam Adams,
08:29I should have known about business, right?
08:30What I realized is, yes, I knew about strategy
08:34and things like that, but in a small business,
08:38you're the CEO, but it doesn't stand
08:42for chief executive officer
08:43because there's really nobody to go out there and execute.
08:46You're the chief everything officer.
08:48You have to do all these things
08:50that are really important to the success of the business
08:54that you've never done before.
08:56And when we started the Brewing the American Dream program,
08:59I realized I don't really know about microfinance.
09:03How do you manage that whole process?
09:05So we partnered with the Accion Opportunity Fund
09:11to help us do that.
09:13And since then, we've made $110 million in loans
09:18to 4,300 companies.
09:22We've provided coaching and counseling to many, many more,
09:27maybe 15,000, 20,000 companies.
09:30And those companies have saved
09:32or created almost 12,000 jobs in their communities.
09:38If I could have a beer with any CEO, living or dead,
09:43it has to be Steve Jobs.
09:45He created a revolution.
09:48A big one.
09:49I just made beer.