Business Leader chats to Julian Hearn about one of the UK’s fastest-growing businesses: Huel

Julian Hearn, Founder, Huel

In the latest edition of Business Leader Magazine, we sat down for a chat with Julian Hearn, the Founder of nutritionally complete food, Huel. Hearn gave us an insight into his background, the inspiration behind Huel, a potential IPO, and much more.

Who is Julian Hearn?

I’m the Founder and CMO (Chief Marketing Officer) of Huel.

I built my first company (Mash up Media) from scratch as the sole founder with a £1,500 investment. Within three years Mash up Media was making over £2.5m profit per year, and I successfully sold it to Internetbrands in 2011.

I’m now the Founder of Huel, which I bootstrapped to over £40m in revenue and a valuation of £220m within four years of launch. We’ve just completed our fifth year in which we generated £72m rev + EBITDA profitable.

  • 1972: Born in Buckinghamshire, England
  • 1988: Left school at 16 with virtually no qualifications (two Es at English, my forte)
  • 1988: Worked in a shop for a year
  • 1989: Worked as a labourer – dug holes in the road for two years
  • 1991: Girlfriend said I was too bright to dig holes, so went back to college
  • 1993: Passed college with distinction, couldn’t get a job, so went to uni
  • 1996: Left uni with a 2:1
  • 97-08: Worked my way up the marketing ladder to Head of Marketing (Starbucks, Tesco, Waitrose, MFI, Emap, etc.)
  • 2008: Started my first company with a £1,500 personal investment
  • 2011: Sold Mash up Media to Internetbrands for a multiple of the £2.5m annual profit it was generating in its third year
  • 2012: Launched next business, Bodyhack
  • 2013: Paused Bodyhack and started work on Huel
  • 2015: On 17th June, Huel was launched from my garage
  • 2018: After bootstrapping Huel to £40m annual run rate, we took £20m investment from Highland Europe, valuing the company at £220m

Why did you create Huel?

I wanted to create something I was proud of.

My first business was a cash generator. It solved my objective at the time to make my family financially secure, but it wasn’t a business I was proud of.

Huel is completely different; money wasn’t the objective. Sure, the lifeblood of a business is money, but Huel is so much more than that. Even if it were a tenth of the size, I would still be into it just as much.

I wanted to create a business that did the right thing for the planet, for its staff, and most importantly, for its customers. I wanted to create a brand that people would be proud to be associated with.

Did you always want to be an entrepreneur?

Entrepreneurs and start-ups are considered trendy today, but it wasn’t like that when I was starting my career. I left school with no qualifications and worked in a shop and as a labourer, but I didn’t think ‘I want to be an entrepreneur’.

I didn’t even know what the word ‘entrepreneur’ meant and there certainly wasn’t a culture around people wanting to be one, like there is today. Obviously, people were entrepreneurs in those days, and they did start businesses, but there was much less of a conversation around it.

Do you feel that the word entrepreneur has been stretched too thin and lost its true meaning?

Yes, I think it has. It has become a cool thing to say and even if somebody has the tiniest business, you call yourself an entrepreneur. I often think people do it because they have heard other people say that they are. Being an entrepreneur means trying to solve a problem and finding market fit by creating a profitable business, that you may exit and then start another business.

Do you think it is an advantage for entrepreneurs not to do well at school?

To be an entrepreneur, you must be a certain type of person. I think sometimes that means that you may be a bad employee or student. I always thought I was okay as an employee, but I didn’t always follow the rules. I didn’t always respect the people who were in charge of it, and I always felt they should approach things in a different way and that meant conflicts.

That tells you that you should be going it alone because you can see your own path, rather than follow somebody else’s instructions. I think sometimes the best employees will follow the instructions to the letter and do as they’re told, and I wasn’t always doing as I was told.

It’s very easy for me to argue that schools and curriculums are out of date, but they work for some, just not for all, entrepreneurs because being a success in business often requires a different mindset.

At school, they’re teaching you stuff that you think I’m never going to use this today. I’ll leave school, I’m never ever going to use this stuff again. So, why are you telling me so you can get a bit disillusioned with it?

When did you first have the idea for Huel?

I had a previous business called Bodyhack but it wasn’t getting enough traction, and the feedback from the users were that this business is too hard to follow and I don’t have enough time in my day to cook and weigh all my food from scratch, so I saw that there was a problem to solve. It was a problem I was facing too, and this is how Huel was first born.

The starting point for the business was ‘How do I solve this problem rather than how do I make money?’ because the latter is a terrible place to start. You need to start with how can I solve a problem in the world and create enough interest in buying that solution.

It was one of those ideas that once you get it in your head, it keeps going and you can’t shake it off. I think sometimes they’re the best ideas because you are always thinking about it, and you don’t forget about it. I was riffing on the same idea, and it has grown from this.

Were you the first to develop a fast-growth meal replacement brand?

I don’t like the term meal replacement and I think it’s a category that is a bit old and dusty. Huel is nutritionally complete food, and it certainly wasn’t something new because the native Indians of America had a product around 200 years ago where they would blend berries, fats and nuts and squeeze it into a nutritionally complete product. When they went on long trips, they would carry that with them.

Moving forward into the 70s and 80s, there were more powdery products, which were close to being nutritionally complete, but there needed to be a more modern approach that gave the body all the essential nutrients that it needs and in a single product. A year into scoping out the product, I came across some that were on the market in Europe and there was one in America, but when I launched, there was nothing like this in the UK.

What has driven that success in your opinion?

Well, as mentioned I think we have clearly achieved something that is product-market fit and I feel we also have a very good product. I also feel that being a direct-to-consumer (DTC) product has allowed us to scale very fast. If you compare us with successful food and drink brands like Red Bull, Fevertree or Innocent Drinks, we have done very well because we will achieve £103m revenue in our sixth year, whereas these brands were much smaller at this point. We also have a healthy EBITDA, so this gives you an idea of our success.

I think the reason that their growth was slower compared to ours was that we were DTC and we were also operating in multiple countries very early, whereas it is a much slower burn when it comes to retail, until you get to full distribution and the big numbers.

That combination of satisfying latent demand, being international and being DTC was a recipe for success. We have also executed very well in terms of our customer service, and we have been innovative in terms of new products and finding new customers.

I am guessing that being a DTC business means that you can track and find new customers?

Yes, when you are utilising online channels, it is very trackable and very measurable and, therefore, it is very easy to optimise. If you’re an online business, you must rely on the retailer pushing your product and giving you the right shelf space. Or you need to invest in outdoor advertising or television and that can be difficult to track and optimise.

You call yourself the ‘CMO Slash Founder’? You clearly value the importance of marketing?

I get frustrated as a marketing person that a lot of businesses are run by finance people. I don’t think finance always generates sales. I don’t think finance makes customers happy. And I think marketers have a mindset, which is based around the questions ‘How do I make a customer happy?’ and ‘How do I tell this customer that this product exists?’ I think that this should be the driving force of any business.

If you look at the most valuable business in the world, it is probably Apple and it was driven by a marketing person, and Elon Musk, although an engineer by trade, understands marketing and is very good at it.

My view is that a business should be driven by the Chief Marketing Officer (CMO), not the Chief Financial Officer (CFO). The latter can lead to cost cutting and they are often not customer-first.

Where do you stand in regard to investing in your personal brand?

I’m a person who doesn’t particularly like the limelight, so I don’t like doing public speaking. I don’t really like to stand up and do speeches at work and I’m not really a person who’s mad keen on social media. So, I feel a bit bad sometimes because I don’t arguably do enough of it. And I’ve seen other businesses where they’ve been very successful with the founder being this almost, you know, sort of showman or someone who really can bring attention to a business.

You are potentially looking to IPO at some point. Can you tell us about that, and why you want to do that?

A company called Highland Europe invested £20m in 2018 and everybody within the business has share options, which means that they are invested in the company. I like the idea of that, and I think it’s motivating for recruitment and retention. So, there must be some sort of exit event at some point for people to realise those investments.

The options on the table are to sell to trade parent or to go it alone forever and be like Mars and try to stay private and release dividends at some point. For me though, an IPO works best because I certainly wouldn’t want to sell it to someone who wouldn’t love it enough, would under resource it and not ensure it reaches its full potential.

A listing makes most sense to me now because you have more control over your destiny, and when I look at the greatest businesses in the world, they are listed.

Regarding employment, where do you feel Huel will be in the next couple of years?

It is difficult to know because we have recruited over 100 people during lockdown, and I think we need to slow recruitment down a little bit and settle those people into the business and let them get up-to-speed.

When you bring a huge number of people in, it can be difficult to keep both the pace of the business and to keep culture and unity.

With so many people joining the business, have you ever been worried about the culture of the company being watered down?

No, not really, because I think we’ve got very good processes in place that ensure we retain a strong culture. I still interview near enough everybody who joins the business and if I can’t make an interview, which is quite rare, then the CEO will do my job for me.

We have a very long and clear recruitment process – if the person joining doesn’t align with our culture, they don’t join the business. We have a high bar which ensures we very rarely make mistakes, and we typically will hire the right person.

How has your approach to productivity changed as the business has grown?

It has changed over time and in the first few years I was working crazy hours, but more recently, I have reduced my hours to four days a week and I have developed more of a work-life balance.

Do you operate work from home or in the office? Or is it more flexible?

For me, working in the office is the best solution, but of course, it is important to offer some flexibility. However, I generally like to engage face-to-face. We would lose staff if we made people work in the office all the time because some people are used to working from home now, so we’ve switched to three days in the office and two days from home. I feel that if you don’t spend time in the office, it is harder to build a culture and people miss out on conversations or moments that they will benefit from.