My water ﬁrm tapped the zeitgeist
Stephen Cohen was laughed at when he proposed selling purified tap water. Today, his waste-saving, eco-friendly idea is a multi-million pound firm.
When former stockbroker Stephen Cohen set up his water systems company two decades ago, he was mocked by industry professionals and the media alike.
But 20 years on, he is clearly having the last laugh. His company, Vivreau, is now Europe's leading developer and manufacturer of purified drinking-water systems. With a turnover of around £5 million, the company supplies chilled and sparkling water - as an alternative to pre-bottled mineral water - to around 75 per cent of the FTSE 100 companies.
What's more, Vivreau has managed to grow during the recession - at a rate of 25 per cent per year over the past three years. And Mr Cohen does not see growth slowing down. "Business has gone from strength to strength," he says.
This growth has been fuelled by the changing economic and cultural climate. Green issues are high up on the corporate agenda and media campaigns against pre-bottled mineral water has led to a surge in interest in mains-fed water systems.
Mr Cohen, 40, says: "The corporate sector understood the environmental impact of what we were doing. We were able to go into an office and say: 'We can eliminate the need for you to transport bottled water across the world, dispose of all your packaging waste and reduce your costs.' That was a big selling point."
Vivreau, which is active in North America, South Africa and Europe, provides clients with machines that purify tap water before chilling and/or carbonating it. They are then given personalised or branded reusable glass bottles, which are filled and cleaned in-house. Clients include Clifford Chance, Ernst & Young, Accenture, Morgan Stanley and Nokia. Vivreau recently teamed up with BRITA, the global leader in water filtration, to provide the most advanced tap system on the market. Production is in Barnsley with head offices in Greenford, West London.
Glass towers: Stephen Cohen supplies drinking water to a majority of FTSE 100 companies
All this must seem a far cry from the early days when Mr Cohen and his late-father Howard started the business with a £2,000 bank overdraft facility and were "laughed down". He recalls: "I decided to leave stock broking and go travelling. When I came back, my father's restaurant business had gone down the pan.
"People had been coming into my father's restaurant and asking for bottled water. It was the time when Perrier decided to launch mineral water and start offering it to the Brits.
"For us, the idea of bottling water in France, shipping it across the Channel and transporting it around the country and throwing the bottle away at the end was just ludicrous. We thought there must be a better way of doing it. From there, we devised a system which would enable us to recreate bottled water without having to purchase the water."
He continues: "It took a long time for it to take off. We were mocked within the industry. People didn't really get it and thought the idea was crazy. Twenty years ago, nobody knew what a carbon footprint really was; let alone caring about reducing it. It wasn't even spoken about.
"People thought mineral water was the only way forward and that anything else was just a cheap copy.
"The media were very cynical and the water industry thought that it would never take off." The scepticism was not helped by the scene in cult comedy sitcom Only Fools and Horses in which Del Boy established a water company and called it Peckham Spring.
But the father-and-son team persevered, supplying the hospitality market. Then when rival companies began to launch, they decided to pursue a different route and target the corporate sector. Vivreau's big break came in 1995 when it secured its first major corporate deal.
"It was also the one that nearly killed us," says Mr Cohen. "We sold £25,000 worth of equipment to Barings Brothers and got paid about 10 days before the Nick Leeson affair erupted and the subsequent demise of Baring Brothers. If we hadn't have been paid, we wouldn't be here today. It would have ruined us."
Howard Cohen died ten years ago, unfortunately before the climate changed in the company's favour, says Mr Cohen, a father of two. "In the early days everything was about promoting mineral water and we were being mocked. Now, we are applauded for helping customers reduce their carbon footprint.
"The emphasis on green issues has had a huge impact on our business. Environmentally friendly and beneficial products are what sell now and, when people started to look for this, we were already there. This made it easier for us to be trusted.
He adds: "When you introduce an environmentally friendly product into your business, it usually creates short-term costs and long-term savings. With our product, because it is rented and not bought, we can achieve environmental benefits and cost-savings from day one. That's why the corporate sector grabbed this with both hands. They love saving money and love going green."
But UK-based Mr Cohen is not getting complacent. He has recently launched a new Vivreau venture, an alternative to portable plastic bottles for on-the-go. His b.blu machine dispenses chilled and filtered mains water into recyclable plastic pouches. The machine has a reverse vend option that enables you to recycle the pouch and earn credits towards the next purchase.
Cohen's tips for start-ups
● If you believe in something, go with your gut feeling
● Have the right team around you
● Have the right supply base that understands the company
● Work with strategic partners - don't think you have to do everything by yourself
● Understand the marketplace, especially if you are expanding abroad
● Stay focussed