Entrepreneur Profile: Sidney Frank, Founder of Grey Goose & Jägermeister - Elite Daily
Sidney Frank is not the prototypical entrepreneur that Elite is accustomed to profiling. But Sidney Frank has undoubtedly competed, battled and won more business ventures than most people ever will. This man had established himself as a promotional marketing wizard, but you may know him better as the man that brought you Jägermeister and Grey Goose.
So next time you are taking down Jäger-bombs, or Red Bull with Goose, remember who is responsible for that.
Like all great innovators, Frank has faced his fair share of doubters and haters. People who know him thought he was crazy for trying to import the German herbal elixir Jägermeister, which was entirely unknown in 1972.
This was no surprise, though, as Jägermeister was only selling about 500 cases a year at the time! By the time Frank was done working his magic, he was selling over 2 million cases of the drink a year.
First I bought two Maybachs. Two big Maybachs, not the little ones. In one of the Maybachs, if you sit in the back seat and press a button it extends like a bed. I bought a Bentley. Little toys. I gave $100 million to Brown. I wanted to be a billionaire. I'm 85 years old; I wanted to count the money while I was on this side of the ground.
So, what was Frank's magic? He executed a unique plan – well, at least a plan that was unique at the time. The plan revolved around a squad of sexy, young women who would throw huge parties, patrol bars and sell drinks to get exposure for Jägermeister. And the plan worked perfectly.
Just think, who are you more likely to buy a drink from: an old male bartender, or a sexy female model dressed to impress while giving you free samples of a great new liquor. This marketing strategy may sound simple today as it is now the standard operation for Red Bull, Virgin and many other products.
But Frank was not done championing the liquor industry just yet. After the success of Jagermeister, Frank embarked on a second venture in 1997: Grey Goose Vodka. It was an instant success and just a few years later he sold it to Bacardi for more than $2 billion.
Like all Elite men, Frank knew how to live well. From an unparalleled fleet of cars, chefs and golf instructors, Frank achieved his childhood dream:
I wanted to be a billionaire
Here are is a collection of snippets from an older interview with Frank, who passed away in 2006. The lessons for success within his stories are invaluable:
I wanted to save to go to college, and it took me until I was 17 years old to accumulate $1,000. I went to Brown for a year; I didn't have money for the second year. I noticed in the paper that they were hiring people at Pratt and Whitney, which made airplane engines, in East Hartford, Conn.
On his first job:
I went up there, and there must have been 100 people in line and nobody was getting a job. And the hiring manager said to me, 'No--oh, you went to Brown? I did too. Go down and see the foreman where they test the engines.' I went down to see the foreman, who said, 'Come back in a couple of hours. I want you to show me you can use a slide rule.' I said, 'Of course.' I didn't know how to use a slide rule. But I looked at the directions, came back two hours later, and showed him how. It was a great job, a dollar an hour, dollar and a half for overtime, two dollars Sunday. So I worked seven days a week.
On getting into the liquor industry:
The father of a girlfriend of mine was having a party in Greenwich Village. Well, I went down and met her father, Lewis Rosenstiel, who was chairman of the board of Schenley, which at that time was the largest distillery in the world. He said, 'You know anything about alcohol as a motor fuel?' I said, 'We use it at takeoff. It gives 20% more power." He said, 'Will you have lunch with me and my chief engineer tomorrow?' And he began teaching me the liquor business. (Frank ended up marrying Rosenstiel's daughter in 1947).
On getting his big break:
The big time came around 1950 when we bought a Scotch plant in Scotland, and the distiller called up my father-in-law and said, 'You have two executive vice presidents getting drunk every night; bring them home and send your son-in-law over.' Well, I went up to the plant in Glasgow, and it was producing a million gallons of grain whiskey a year. I didn't think that was much because some of our plants in the States would do 10 million gallons. And so I watched very carefully, and I said to the distiller, 'I notice you're only distilling twice a week. Why is that?' He said, 'It used to be law.' I said, 'Is it still the law?' 'No.' "No? You mean you can distill seven days a week?' 'Yes, but my instructions were to do what was always done.'
On being a disruptor:
So we began doing seven days a week and increased production from one million to three million six. It cost a dollar a gallon to make, and you can sell it for $5 a gallon. That's $10 million, and we only paid $13 million for the company. So I was a big hero.
I butted heads with my father-in-law, and I finally started my own company in 1972. It was just me, my brother and a secretary. One of the things I'd learned was it's a lot of money for bricks and mortar; don't build a distillery until you have enough money to do it properly and enough production to put in it. So I began looking for something to import. I noticed a few bars selling Jägermeister. I was looking for anything that had a niche. And warm Jägermeister is terrible, but whatever it was, people of German descent like Jägermeister. There were a lot of Germans around the country. So I sent a telex to the president of Jägermeister in Germany and asked if he would see me.
I said, 'I'd like to have Jägermeister for the States.' He said, 'We already have commitments for most of the country, but we still have Maryland to Florida left.' I said, 'I'll take it.' But the next year the importer from the East Coast didn't pay his bills on time. So I got Jägermeister, eventually, for every place except the West Coast. The president had never been to the U.S., but he flew to the West Coast and asked the importer there to take him to Disneyland. They got lost, so he figured he didn't know the territory. So I got the whole country in 1973.
On what made him successful:
But the big thing I had, I came up with Jägerettes. I thought a pretty girl can always help you selling, and I noticed that one girl I had in California would go to 80 tables in a room and say, 'Open your mouth.' She asked, 'Would you like a Jägermeister?' And 80% of 'em said yes. It was hard getting that first girl. They thought we were running a den of iniquity. Eventually they began to trust us, and we got two and three and 10. Now we have 900. And 300 Jägerdudes.
On his second venture – Grey Goose:
Grey Goose started because I figured that we were so popular with the bars and distributors [that they] were making a lot of money on us... The big-selling high-priced vodka at the time was Absolut, which was $15 a bottle. I figured, let's make it very exclusive and sell Grey Goose for $30 a bottle. We submitted two bottles to the Beverage Testing Institute, and Grey Goose won as the best-tasting vodka in the world. So we took $3 million, which was going to be our total profit for a year, and we put it into advertising. We gave away Grey Goose to any charity that wanted vodka at its bar. The people at charity events are the people who are our target audience. Sales started to zoom. In 2004 we sold 1.5 million cases.
On being filthy rich:
A banker in Paris asked to see me. He said, 'I think you're getting someplace with Grey Goose; a lot of distillers would like it.' About a year ago he came to me and said, 'I was just with the chair of the board of Bacardi. He says he would give you over $2 billion for Grey Goose.' We went back and forth, and then the chairman said, 'I'll give you two' – I can't give the actual figure, but it was a lot more than $2 billion.