Chapter 17: Red Bull (4)
Just when everybody was enjoying the warm moment Simon's paternal grandfather, Felix Smith, finally spoke up himself. His voice was quite deep and he had an aura full of authority.
"Now that we got those problems out of our way it is time to talk about the serious business Simon. We are all very glad about your success with Atari and if your second game is as successful as the first one the whole family will fully support you in developing this company.
But as your parents already explained to you, the cost of keeping Atari all by yourself will be to make your food and beverage company work out and share the benefits with Wall Street and maybe some different partners on the west coast.
But before we speculate about anything you will first need to really explain to us what you are planning to do. With Atari you founded a new business by yourself, something that wasn't really done before and you had no opponents, even now.
But food and beverage developed pretty much since human beings existed. It is definitely not easy to develop something new and make it reach heights similar to your game business.
What are your plans and thoughts?"
After getting reminded by his grandfather Simon finally got out of his sister's embrace and started getting serious again. He took some time to regain his composure and think about how to explain the concept of energy drinks to his family and why they are needed.
He slowly explained to them the context of energy drinks and what they would consist of.
"The company I would like to found will be called 'Red Bull' and the catch phrase of the company will be very simple but catchy.
'Red Bull gives you wings.'
Energy drinks as new models will be marketed to gamers, students, blue collar workers and athletes. It is more like a premium product and the profit margin will be quite high.
But my plan is to not take out any of the profits during the first few years and invest everything into advertisement. I want to make the brand 'Red Bull' and the catchphrase known all over the world. Try to gain a market status as big and powerful as possible.
The marketing budget will be used mainly to invest in sport business. For example sponsoring teams and sponsoring the best athletes in all kinds of sports. At first we will mainly invest in baseball, American football and football. In Europe football players will make up for the largest amount of sponsoring, while in the United States we will focus on baseball and American football, maybe basketball once the sport grows bigger.
We can even buy sports teams and use the brand Red Bull or RB to name the teams or sponsor them directly. Investing in basketball might be a good choice, as the NBA teams won't be very expensive at this point and we could try a basketball team as the first project.
Overall the success of energy drinks will mainly rely on the effectiveness of the product, the taste and the largest part is the marketing itself.
As long as we can let Red Bull reach the level I imagine we can produce a beverage giant with larger profits than even Coca-Cola while using the marketing budget to invest heavily in sports.
This does not only guarantee a profitable business in the future, but will also increase the influence of Red Bull on the public opinion. Imagine if we sponsor athletes and clubs around the world with hundreds of millions of fans. This is a huge public opinion power which will equal many Hollywood giants or old newspaper families.
I am sure this business plan will be extremely interesting for many Wall Street giants. As long as we invest into the company first, create the first recipe for Red Bull and acquire all related patents and start with production, I am sure they can never overtake us in marketing ideas. I think nobody here would question my creativity, even if I sometimes make some stupid mistakes.
When they realize the great business behind energy drinks and the even greater public opinion control they will fight between themselves to get as many shares as possible.
Of course this plan sounds easy but is extremely hard to implement. Now it depends on you Caroline, do you think you can make this dream a reality and conquer Wall Street and show the world just how great a female business woman can be?"
Everybody was listening attentively to Simon's plan for the new company. When he announced the name and the catch phrase Caroline's eyes were already sparkling, but when she learned just how big Simon planned for Red Bull to become and how far the influence of this global company should become in his mind, her hands were slowly starting to become wet with sweat. When he mentioned conquering Wall Street and becoming the world's greatest business woman Caroline honestly was a little short of bread and she had to sit down.
Of course her mother noticed the abnormality of her own daughter and she had to admit to herself that even she was intimidated by the vision of her younger son.
Simon's two grandfathers were already getting excited thinking about being the managing party of such a large industry. They could combine many of the favors their law firm gained over the years in this new company and bind many alliance partners' interests' closer to their own family. Of course everything depended on whether the market for energy drinks would really be as great as Simon portrayed it to be.
But they believed in their grandson because once you are successful in founding a company by yourself and show the worth of your ideas, people tend to believe in you, until you finally fail once. Additionally Simon could invest in this company all by himself with the large amount of money Atari is earning every month. There is literally no need for him to scam his own family with something like this. They were sure he only brought this idea up because he truly believed in his sister and the idea itself.
After taking a few minutes to calm down Caroline of course agreed to lead this project and was already starting to ask questions on what she should do next. Of course Simon was helping her with any idea that came to his mind, but honestly, inventing the energy drink recipe and getting patents was the most important. Simon would invest a few million into the new company 'Red Bull' and Caroline was meant to buy a small beverage factory and hire people to invent the energy drink, relying on some non carbonated drinks from Thailand.
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