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Fail Smart: An Interview with Rhonda Kallman

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“Being an innovator and trying to make a light beer for craft beer drinkers was an oxymoron” –Rhonda Kallman

Rhonda Kallman is one of the original co-founders of Boston Beer Company, which is famous for Sam Adams beer. After working with Jim Koch to make Sam Adams a household name, she branched out to create her own company. New Century Brewing made great beers like Moonshot and Edison Light. However, the company got caught in FDA regulations and was shut down due to standards concerning caffeine in alcoholic beverages.

Before the hammer came down on the recipes she worked so hard to make, there were other hurdles she had to overcome. Below, Rhonda Kallman discusses the many trials and tribulations that she went through for the love of beer.

What is your biggest mistake or failure starting your company? What did you learn? 

In the early days of a new, cash-strapped start up, it is not the time to zig when the trend is to zag or even innovate. For example, my company made a terrific light beer, created by the original inventor of light beer. Although the beer recipe appealed to 95+% of the total $100B market, those drinkers didn't know there was a small, independent company brewing a beer they would enjoy, as they related "micro" to darker, heavier, hoppy and even fruity beers. The bigger beers were driving growth in the category. The 'craft' consumers didn't want a light beer. Bottom line, if I had started with a bold IPA, for example, in the early days, I'd probably still be in business today.

What would you consider to be your biggest hiring mistake?

Hiring a group of talented, experienced individuals that expected the same, or more, compensation they made in big companies. I paid them what they wanted, though couldn't sustain it.

What is the worst advice you were given and followed? 

The company launched on the eve of 9/11. After that world-shattering event, the capital markets crumbled and investment capital was very difficult. I ended up in due diligence for three long months with a venture capital group. They wanted to see me scale the company quickly and I did. We got all the way to a term sheet and then they never returned a call and didn't invest. Worst mistake...should've stayed close to home and build the cash flow slowly. What did you learn from it? Or, looking back, what’s the best advice you’ve received but chose to ignore? My first investor told me “it always takes 2x as long and 2x as much”...he was right!!

Is there such a thing as growing too fast? Have you ever failed planning for growth and pace? If yes, how?

See above...

Is failure necessary? Can you learn from your mistakes? 

Failure is NOT necessary, though it does happen. I'd rather have tried and failed then to never have tried at all. YES, you have to learn from your mistakes to move on and continue to personally/professionally grow.

 

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