First AngelsJa successes | Patria-Kaye's journey up Sweetie highway (Part 2)
We started the journey up Sweetie highway with candy-maker Patria-Kaye Aarons on Thursday. We continue today. Come with us.
I need an angel (investor)
Sweetie Confectionery had taken off in spectacular fashion and was growing bigger and bigger each year - faster than Patria-Kaye's pocket could handle. Every order was bigger than the last as she had gone from selling out of her car trunk to having Sweetie in 20 locations then landing a local distributor, which immediately catapulted them to 100 locations, followed by distribution deals in the US Virgin Islands, the UK, and the US in quick succession. "The business was growing and growing, and I was holding it back because I couldn't afford to purchase enough raw materials to make the production runs or purchase enough packaging. I got to a place where I recognised that this business is bigger than me, and I needed help," she recalled.
By this time, the banks that had initially refused to give her a business loan were now courting her attention, but she wasn't interested as their interest rates were "ridiculous". She also knew that she needed more than financial assistance as a newly minted CEO just trying to swim. "I'm a marketer, and I love to spend money. As a CEO, my objective has to be extremely different. Part of the success of Sweetie was going to depend on the support and expertise of people who have been there, who succeeded, who failed, who can caution me, so angel investing was attractive to me in that regard. And I also knew that in five years, I wanted to list on the Junior Stock Exchange, and there's a kind of governance structure that's required to be able to make that transition," she explained.
Through the Branson Centre, Patria-Kaye began to pitch Sweetie to potential angel investors. She first approached FirstAngelsJA last September, and the pitch was successful, but the signing process was delayed as she had recently been selected as one of eight Jamaican fellows in former US President Barack Obama's Young Leaders of the Americas Initiative (YLAI) and had to leave the island for the six-week programme. "The Angels loved Sweetie and they got it. They got who we were. They got me. They got where I wanted the business to go. And I think it helped that I knew my business. I wasn't moonlighting in Sweetie. Sweetie was my primary focus and had been for two years, so I knew what it needed to grow, and I was very clear about that," she said.
Board of directors
Sweetie is the newest company on the FirstAngelsJA roster, having finally inked the deal in April last year, so there is still a lot of ground to cover, especially from the governance standpoint. The company does have a board of directors in place, which includes chairman Michael Ranglin, who formerly headed up the food arm of GraceKennedy; Ann-Marie Smith from the Scientific Research Council, who was instrumental in Sweetie's research and development (R&D) process; advertising maven Kimala Bennett, managing director of The LAB; and Kareem Tomlinson from Jamaica Money Market Brokers (JMMB), who handles the numbers - the latter two directors representing the angel investors.
The cash inflow has already made a huge difference as Paul Lue-Yen finally closed his doors permanently last November, so Sweetie needed a new production home. Also, the machinery at Miel was from the 1980s, and being old, it would often break down, leading to postponed orders. This was costing Sweetie both in terms of dollars and reputation. With the angel investment, Patria-Kaye has been able to get Sweetie its own factory space with brand-new machinery. "I'm able to do the hard candies in a way more efficient, First-World manner. I'm able to provide 500 per cent more jobs. I'm able to double my offerings because the machinery that I used before could only do hard candies, but now, I can put a stick in some of those hard candies and give you a lollipop. I now have the freedom to do research and development in my own space. It's really given me the flexibility to grow exponentially, and the confidence to chase new markets and new customers," she shared.
Come out of the silo
Having experienced the benefits of angel investment, even though it's early days yet, Patria-Kaye believes it is something other entrepreneurs should seek. "Entrepreneurs often operate in these silos. It's a very lonely journey sometimes, and the sharing of information, I've found, is very helpful. The angel networks have a way of knowing what's out there, what grants are out there, what training facilities might be out there, what opportunities for exposure might be out there and the ability to share that within the networks," she said.
To entrepreneurs who feel that they might be ready to take the leap and approach an angel network, she offered this advice: "Know your business very well. Know what you want. Don't go in there saying, 'Beg yu an investment' and not be sure what you would do with that money if you get it. Be very clear how you would use that money to make money for yourself and those investors. Don't get it twisted: this is still a money-making venture for them, and they need to have the confidence that they will get their money back. I would also say, don't be afraid to give up some of the business. We love our companies, but if you don't let go of a piece of it, you're going to stagnate the growth of that company. You're going to slow down what it could be, so be willing to let go."
The next five years
"Come 2021, Jamaicans should be able to buy into Sweetie, and I'm readying the company from now," Patria-Kaye stated. Part of that getting-ready process is expanding product lines. By next year, a new assortment of sour flavours such as tamarind, passion fruit, and Jamaican cherry will be available, as well as taffies and gummies - or 'juju,' as Jamaicans call them.
Being proudly Jamaican is a key part of Sweetie's identity. "I am first and foremost a marketer, and before I even made the first sweetie, I was very clear about what the identity of my brand was going to be: execution, excellence, Jamaica first. So throughout that R&D process and even today, I still think anything that needs to be done or purchased or executed, can I get it in Jamaica?"
The only 'foreign' element you will find in Sweetie Confectionery's candies is the natural fruit-flavoured oils that give them their taste. There is currently no local entity commercially extracting oils, and Patria-Kaye doesn't want to take up that aspect of production. "I just want to make the sweetie," she said. "I'm encouraging somebody out there to go and start a business extracting oils from local fruits. As much as I can use it, the cosmetics and lotion people and the aromatherapy people can use that same oil. There are business opportunities waiting for people to tap into. I found mine. I'm begging other people to go out there and find theirs."