More Mojo | Julian Giacomelli of RISE Kombucha on sustainability and capitalism cover image
Julian Giacomelli of RISE Kombucha breaks down the paradoxes of sustainability and capitalism and how there’s hope for the future, in this bonus episode of Mojo Moments.
Julian Giacomelli
Julian Giacomelli

It's promising. It doesn't mean - you know, there's not enough opportunities. So you've got all these young folks that want to do more purposeful things, and unfortunately, there aren't the jobs, or even the entrepreunerial opportunities. But I do believe that those are the right forces at work, and that we have to go this route. 

Thane Calder
Thane Calder

Hi everyone and welcome to Mojo Moments, I’m your host Thane Calder. 

Last week we released my discussion with Julian Giacomelli, co-founder of RISE Kombucha and discussed the mojo in his industry and how COVID is pushing people to fix their nests. 

For this week, we selected a part of our discussion where we discussed the intersection of sustainability and capitalism, with a particular focus on how businesses can scale, and maintain their values. 

So, listen up!

Thane
Thane

We've had these conversations, you know, around capitalism and sustainability. Like, where are we at? Like where's the mojo around this today in the business world? And what are you seeing out there? How do you feel things are going to come out of this COVID era are on that front?

Julian Giacomelli
Julian Giacomelli

It's a nuanced question. I think that we're living a lot of paradoxes.

We're living a lot of tension. And so we're simultaneously living in the era where the gods are billionaires and most of those folks that have become billionaires, aren't doing anything or very much proactively to help the problems we're having. And a lot of the time it's almost contributing to. So there's still a lot of extractive capitalism.

We're simultaneously seeing a ton of more mainstream initiatives and a lot more interest in particular in climate change. So the awarenesses are growing, I think, in the business world. We're seeing certainly broader adoption of, at the most base level for large companies is ESG. So it's so paying attention to ethics... I'm sorry, environmental, social, and governance. You know, we're seeing definitely an increase in things like the B Corp, which is an effort for a business to get certified and think about how it can be better holistically. Taking into account multi stakeholders. Is there a lot more going on on the ground yet?

No, I don't think so. I think that the COVID circumstances we're under is actually, from that perspective, a positive one in terms of, I do believe that consumers have naturally gone back to more local, or are somehow we're a little bit more connected to trying to support what's good from where they are.

I think we're going to be going through a series of continued shocks that are going to create more urgency for us to change the way we live and the way we do business. And it's helpful, but it's still, let's just say it's not enough. But I am happy to be seeing a greater instance of things going on.

And I think one of the most promising things is I spent a lot of time working with young entrepreneurs, especially in the social and environmentally impactful spaces. And that there does seem to be a growing resistance for young folks to work for the man and do things that they don't believe in. It's promising.

It doesn't mean, you know, there's not enough opportunities. So you've got all these young folks that want to do more purposeful things. And unfortunately there aren't the jobs or even the entrepreneurial opportunities, but I do believe that those are the right forces at work and that we have to go this route.

So I think it's going to get worse before it gets better, because I think there's a simultaneous rise of interest and say consciousness around how we consume and how we want to be in business and also a rise of the, sort of the 1% getting richer. And those folks that have figured stuff out, allowing them to do that, continue that accumulation at an increasing rate. So there's sort of the rise of the good and the bad at the same time.

Thane
Thane

 Do you feel when you look back on your era with RISE kombucha that you guys did it right? Or is there something, if you could go back, you would have maybe, done differently?

Julian Giacomelli
Julian Giacomelli

I think we did a lot of things right. More than anything, participating in growing a business. And, you know, especially with the Crudescence. If I count between Crudescence and RISE, the number of employees and staff and folks that we touched and worked with is in the several hundreds, like maybe 500 or plus. And each of those folks had a chance to work in a different mindset kind of business. I think the one thing that I wish we had done a little bit more of in RISE in particular, in the early days was to concretize and articulate better, actually the values that we wanted and what we wanted to see change in the world.

I think what happens is, you know, when you've been in entrepreneurial circles for a long time, as soon as this something starts to go well, the focus is on the scaling. And we all, we all aspire to have businesses that scale, and I'm not advocating at all that we should look for businesses that only stay small.

In fact, my current work these days is trying to find those teams that are scaling, but have some ability to scale. And in those early days, not year one, cause year one, two and three, you're just trying to figure out product market fit. What's the margin? Is there even a product for us? You're not worried about, "How do we come together? How do we organize? How can we have better values?" 

I think some of that's innate. But it's in those years, sort of three, four, five, say, maybe a bit earlier in the fast scaling that it is really important to buckle down and ask, you know, the ownership and founding team, how we want to be and what are the values we really want to keep, because if you don't, as you scale, then that can get diluted and loss.

And I wouldn't say it was completely gone from RISE at all. RISE is an amazing place to work, but there was a bit of a period in the middle where there such a focus on just delivering the product. And then we were scaling the accounts and scaling the batch sizes. That a lot of the ways of coming together and some of the early values were inadvertently lost.

And if you don't intentionally hold that as a leader, then it won't hold itself. So I think that's probably the only area that I wish we had leaned in a little bit, but then we were in those days, we were just like, "Holy crap. We got to... How do we make more?" Like just, we couldn't make enough.

Thane
Thane

Yeah, yeah.

Julian Giacomelli
Julian Giacomelli

So easy to say hard to do. And I think the only way it could have happened was being better prepared. And again, hindsight is 2020, and you don't know what you don't know. So I think part of my interest now in mentoring and working with these younger founders is that - in the hopes that the ones that are lucky enough to be funding that need and market, and product or service, to try to help them earlier on think about, as we scale, how do we want to be coming together? What are the values we really want to live? And how does that show up in the business? Because it's the last frontier.

Now everyone's talking about impact models and margin, but no one talks about what's the organization structure and what's the mindset, and how do we build a culture that really... At the end of the day, once you figured out the product market fit, and you can do that, it's only about how you bring the people together. And it's only about the values that you can create. And if you can create a culture where people care more, that everyone understands why we're coming together and there's some kind of manifesto or purpose, then they will give more and naturally the product will keep getting better and you'll do well.

And there was a bit of that missing in the middle years of RISE.

Thane
Thane

It's really  interesting you say that, because I've had many conversations with entrepreneurs around... like, scaling is a bitch. It's a royal bitch.

I mean, I know at CloudRaker, you know, we've done well, but the scaling part is a whole other kettle of fish, you know. When you look out in the world, have you seen businesses that have done that right? Or one that you would go, "That one I feel scaled right and had the true - you know, captured their values"?

Julian Giacomelli
Julian Giacomelli

A few. I mean, you know, they're often named, you know, I looked to Patagonia sometimes for good leadership and having really brought the values together. There's a fascinating book by Frédéric Laloux called  Reinventing Organizations. And he's gone and found almost 15 organizations and many of them are unknown. So, you know, I can name some of the other classics, Western ones that are now attaching some of these values, but I don't believe that they grew, that way. Like Danone is doing an amazing job of becoming a B Corp and trying to reverse engineer, some of that stuff, but they got to scale through selling bad candies. So I don't that's...

Thane
Thane

Wait you mean the Danone yogurts?

Julian Giacomelli
Julian Giacomelli

Yes. So Patagonia is a good example. There are still few and far between, so this is why my thesis right now, is that we are going to find more of these organizations.

Etsy was a good example in many ways, the founder of Etsy and a lot of the way they were really motivated by both power of e-commerce, but also really uplifting individuals and not just commoditizing and selling.

Thane
Thane

What about Chobani?

Julian Giacomelli
Julian Giacomelli

Chobani is an example, I mean, he's a powerful force that the early years it was amazing, you know, but if you walked in today to the Chobani offices, I don't know, I'm literally, I'm not saying no, but I don't know that they've necessarily been able to - if you don't ground it in everything about the company, it just gets slowly diluted. It happened at the Body Shop. Joyce was an amazing founder. It happened at Ben and Jerry's. And the legacy of that would be that the company at that scale coming close to a billion dollars would have a place where people really love to work.

And we hear about Zappos. I don't know, these are all examples that I've heard about, but until I've visited and walk the floor and talked to employees, it's hard to know how much of it is like...

Thane
Thane

It's interesting in the advertising world as a, you know, a famous agency back in the day, Chiat/Day.

Julian Giacomelli
Julian Giacomelli

Yep. That was the place.

Thane
Thane

They're the ones behind all the Apple, famous Apple ads. And Jay Chiat once was quoted as saying, we want to see how big we can get before we get bad. And the day that happens, I'm out. And that's when he sold.

Julian Giacomelli
Julian Giacomelli

I think honestly, even, maybe in another example that I think did incredibly well for a long time is Lululemon.

And I say that because, you can tell more about how a company is doing when the staff gets excited talking to you about their work, then what the consumers say about the product. Because a lot of companies make products that are jewel worthy and that people love. And Lululemon had a culture of learning, had a culture where the store is engaged, their staff that were simply clerks selling clothes in a way that made them feel like they were doing more, engaged them in personal growth pursuits, gave back to the community.

Thane
Thane

So where would you say they are now? Have they recaptured their mojo? I mean, their stock has, but do you feel...

Julian Giacomelli
Julian Giacomelli

I don't know. Then, then there's always like the founder leaves through pseudo crises and.

The new folks come in and say "What? You're spending 20% a year on this. And we cut that." So I don't know. I know that it's still a good place to work from a creative perspective, but I'm not sure if they've been able to recapture that. It's also really hard. I mean, the first 10 years of a business are never like the next 20, cause you're still feel like you're part of that original arc.

You still feel like you can remember when there was only whatever a hundred stores or 50 stores or I'm not sure.

Thane
Thane

Yeah, yeah.

Julian Giacomelli
Julian Giacomelli

And you know, it needs to evolve. It can't stay the same. Like we could never go back to the time in RISE when we were in the 500 stores in Quebec. And there was like literally mob scene when we would launch a new, something new and we were local and all of a sudden it's very different than when we started selling in Vancouver.

And even in the beginning of the U.S., because you can never be that same local business. So you have to find a way to evolve and repurpose, almost. Around the same visions, but it's different when the scale is hyperlocal versus, you know, Pan-Canadian versus something else.



Thane
Thane

And there you have it. We hope you enjoyed this discussion with Julian, and you can check out the full episode wherever you listen to your podcasts. 

If you like this podcast, feel free to share it around you and give it a five-star rating on Apple Podcasts. 

Taking us away are the tunes of Chris Velan, take care, speak soon.

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