Cobra’s Chairman on Turning an Indian Beer into a Global Brand
When he was a law student at Cambridge University, the author sat in a classic British pub one evening wondering whether to have a too-fizzy lager or a too-heavy ale. He longed to create a more balanced beer that would pair well with food, especially the spicy curries from his native India. Something cold and refreshing but also smooth. He started experimenting, mixing brews that were then on the market to find the right blend.
While on tour in India with his Cambridge polo team, he saw an opportunity to gain some business experience: He could sell Indian-made polo sticks in the UK. After being introduced by chance to India’s largest independent brewer, he collaborated with its brewmaster to find the right recipe—and then drove around the UK in a battered old Citroën to market his beer to Indian restaurants.
Eventually the Indian brewery could no longer cope with increasing sales, so Cobra moved production to the UK. Then, after the company weathered what the author calls three “existential” crises, Molson Coors agreed in 2009 to a joint venture with Cobra, which now exports to nearly every European country along with Japan, Canada, and Australia.
When I was a young boy in Hyderabad, India, teachers told me I wasn’t creative. I couldn’t draw or play the piano, so they advised me to focus on academics, which I did. I graduated from a university in India with a commerce degree and moved to London to take a job at Ernst & Young, where I qualified as a chartered accountant (CPA). I then went to Cambridge University to read law, assuming that I’d become a barrister or an M&A adviser.
But a latent creativity was inside me waiting to break out. Sitting in a traditional British pub one evening after classes, wondering whether to have a too-fizzy lager or a too-heavy ale, I had an idea: I wanted to create a more balanced beer, one that would pair well with food, especially the spicy curries from home. It would appeal to both men and women. And I could eventually sell it around the world.
That was the dream. Today it is a reality. The beer brand I eventually launched, Cobra, now generates $250 million annually in global retail sales. The journey required a great deal of creativity. It also demanded vision, flexibility, and integrity—not just from me but from everyone who helped me build the business. I never reconnected with those grade school teachers, but I hope they would be proud.
Although I declined to continue my career in accounting or to pursue one in the legal profession, the specialized training I received in both fields was invaluable. Particularly in the United Kingdom, many CEOs and FTSE 100 board members start as CPAs; we all benefit from a firm grounding in finance. Indeed, in addition to serving as CEO, I led the finance function at Cobra for its first 10 years. My time at Ernst & Young also provided an excellent professional foundation. I learned how to operate in a global firm and was exposed to a variety of businesses from the inside; this gave me insight into how I might run my own. As a law student who debated in the Cambridge Union and stood for university union elections, I learned how to build relationships, make a case with passion and reason, and get people behind me.
But entrepreneurship was always calling to me in the background. My great-grandfather had pursued this path: He built his own business (and lost it three times) before eventually amassing the family fortune. He then became a noted philanthropist and a member of the House of Lords in India. I was just three years old when he passed away, but one of his daughters, my great-aunt, told many stories about him, so he remained an important influence.
When the idea for Cobra struck me in that Cambridge pub, I couldn’t let it go. I was a beer lover but often found lagers to be gassy, bland, and bloating; ales, meanwhile, were too heavy and bitter to drink with food. I wanted something in between—cold and refreshing but also smooth. Each night I found myself experimenting, mixing brews that were then on the market to find the right blend. At the same time, I knew that launching a beer brand was too ambitious for a first venture. I needed to acquire some business experience first. When my polo team at Cambridge did a tour of India, I saw an opportunity: selling Indian-made polo sticks in the UK. That was a way to open lines of commerce between the country where I’d been raised and the one to which I’d emigrated as a student. Although India was then a closed economy with a socialist model, I anticipated liberalization.
So in 1989 I teamed up with Arjun Reddy, a friend from Hyderabad, and we launched our polo-stick-importing business. I knew from my days running for office at Cambridge that when it comes to selling, there’s no shortcut. You have to go door-to-door with your pitch. Soon Harrods and Lillywhites were clients, and we’d expanded into other traditional Indian goods, including leather, silks, and garments.
Within nine months, however, we’d been introduced by chance to India’s largest independent brewer, in Bangalore. It employed the country’s finest brewmaster, an Indian biochemist who had studied in Prague, but it had never exported its product. I seized the opening and explained my idea. The company first suggested that we import two of its brands to the UK: Pals and Knock Out. But the former shared the name of a British dog food, and the latter—suggesting a boxer’s punch—wasn’t what we had in mind. Amazingly, the company agreed to let us develop our own brand. I already had the taste in my mind; the brewmaster and I just needed to sit in the laboratory and come up with the recipe.
I parked myself in India for several months while my partner held down the fort in London. We knew we had to get the product right. This was well before the craft beer boom, but we still had to make ours different from and better than the hundreds of brands already out there.
Once I thought we had it right, I returned to the UK and began driving around—in a battered old Citroën—to all the top Indian restaurants so that I could introduce the proprietors to our beer. I knew that if they placed an order, other curry houses would too, and then distributors would pile in to serve this growing segment of the industry—up from a handful of establishments serving mostly expats in the 1950s to about 6,000 restaurants that drew all types of British consumers in the early 1990s. (Today curry restaurants in the UK number more than 12,000.) In that first sales push we managed to presell one shipping container’s worth of bottles—half to restaurants and half to a distributor in Newcastle.
The Cobra name was what sealed the distribution deal. After lots of brainstorming sessions, we had decided to call our beer Panther. We’d already designed the labels; the beer was waiting to be bottled and sent to the UK. But potential distributors complained to Arjun that they didn’t like the name Panther—they couldn’t say why, they just didn’t. So we thought back to our runner-up choice. “Ask if they’ll buy something called Cobra,” I told my partner. The distributors said yes, so I asked my brother, who was in advertising, to design us a new label. Adapt or die.
In those early days finance was the biggest challenge. With reorders strong, we realized very quickly that people loved our product, and that gave us confidence. But we needed money to make more beer, and we didn’t want to give up our majority stake in the fledgling company. We availed ourselves of every form of government finance and eventually found an angel investor who took a 5% share that valued us at £1 million.
Three years in we hired a few more salespeople and began to invest in marketing. We created pint glasses featuring a map of India and gave them to restaurants, whose owners reported that customers liked them so much they were taking them home. At the five-year mark Arjun decided he wanted to move back to India. At the time, our revenue was about £2 million, and perhaps he didn’t expect it to grow much more. But I wanted to stick with Cobra. I strongly believed that it could become a global brand, so I bought him out on his terms, and we remain good friends.
Happily, sales doubled the next year. Now production was the problem. The Bangalore brewery couldn’t cope, and we had issues with quality, consistency, and availability. I had to decide whether to expand capacity in India or in the UK. The knee-jerk reaction from distributors was to insist that we remain an imported beer. But when we surveyed consumers, we found that they appreciated the beer’s extra-smooth taste more than its country of origin. That gave me the confidence to adapt again and move production to Bedford, in the UK. With increased capacity, we were able to expand our reach to different types of restaurants along with pubs and bars; we could produce Cobra in kegs to serve on draft—exactly the way I’d been drinking beer when I came up with the concept.
The climb from there to where we are today has not been without further setbacks, however. In fact, in a near-echo of my great-grandfather’s experience, I almost lost the business three times. The first crisis was sparked in 1998 by an article criticizing the service in Indian restaurants—published in a trade magazine that I’d helped create and that still listed my name on the masthead. That prompted a yearlong boycott of Cobra, during which we had to close our UK depots and lay off employees. Sales grew by an anemic 3% over that 12-month period, and I thought we were finished. Eventually, however, with a lot of hard work, we persuaded the restaurants that we would never want to harm them, and they lifted their ban.
The second crisis came in 2008. By this stage Cobra was a much larger company, and we needed significant investment to pursue our global growth plans. One of the world’s largest liquor companies had agreed to pay £30 million for a 30% equity stake in the company. But its management suddenly got cold feet and pulled out. Thankfully, I had a plan B: financing from an Indian bank. We secured the loan—just two weeks before Lehman Brothers collapsed.
That bought us some time, but within a year we were confronting the third existential threat: A financial backer that had suffered badly in the global downturn called in its loan and ordered us to sell the company in the worst possible climate. Our valuation had been £100 million; now we would get much less. That was very painful. In March of 2009 Molson Coors expressed interest in a joint venture: It would take 50.1%; I would retain 49.9% and stay on as chairman and integrate my team. The deal satisfied 90% of our creditors, but one balked, forcing us to enter what is called a pre-pack administration, in which anyone can bid for the company. We persuaded Molson Coors to come back to the table with us and put in a joint bid. It did, and we saved the company, ensuring that one-third of our employees could move to the joint venture and that those made redundant would be paid out in full, along with some remaining shareholders.
When I reflect on how we managed to survive each of those scenarios, I seize on the elements I mentioned at the start of this story. First, my vision for the company never wavered. I wanted to create the finest Indian beer and sell it everywhere. With determination, my team and I turned Cobra into a household name in Britain, and that strength of brand helped us through tough times; during none of the crises did our sales decline.
At the same time, we’ve been creative and flexible—willing to constantly adapt, learn, grow, and innovate. That’s the heart of successful entrepreneurship: knowing where you want to go but staying open to different ways of getting there.
Another key element of our success has been integrity. Throughout the life of Cobra, I have been surrounded by loyal partners, employees, and family—especially my wife, whom I met one year after I started the business. They stuck with me and the company through thick and thin, and I am immensely grateful. As a group we have also always adhered to strong moral principles. Even when others didn’t play it straight, we did. In my opinion, it’s better to fail doing the right thing than to succeed doing the wrong one.
Now that we’re a part of the Molson Coors family, I continue to stoke the same fires: vision, creative flexibility, and integrity. Cobra has won 101 gold medals at the Monde Selection competition over the years, and we now export to nearly every European Union country, along with Japan, Canada, and Australia. Because Anheuser-Busch has the King Cobra brand, we’ve wrestled with trademark restrictions in the United States.
Although a large company can be bureaucratic, I still push for innovation, adaptation, and a fast pace. In 2018 we launched Cobra Malabar, a blond IPA. It comes from a complex, top-fermented recipe, and it took us two years to deliver. But we got there in the end, and now Cobra has the whole Molson Coors machine—finance, marketing, and distribution—behind it.
I continue to focus on building strong, trusting relationships across the company. Because Arjun and I spent the early years of Cobra doing everything, from setting up production to negotiating with restaurants to hiring employees, I can visit every part of this American-Canadian-British-Indian business and identify with what people are doing. At the executive level I’ve gotten to know Pete Coors, the Molson family, and the global and UK leadership teams personally. Churn is inevitable in an organization as big as ours, but there’s no reason we can’t cultivate the same loyalty we had in Cobra’s start-up days—and endeavor together to always do what’s right.
For the past decade and a half I’ve also become involved in the broader UK business and political community. I have served as deputy lieutenant of Greater London, and in 2006 I was named an independent crossbench life peer in the House of Lords. I’ve tried to bring my entrepreneurial experiences and approach to these roles, too. Over the past few years, for example, I’ve been quite vocal about my opposition to Brexit. I’m sticking my neck out because I believe this is so important—not just to Cobra and other UK-based businesses but also to future generations of citizens. We are better off remaining in the European Union. This is yet another situation outside the world of music and art that calls for vision, creativity, and integrity. But I believe that I, my team, and my adopted country are up to the challenge.
Karan Bilimoria is the chairman of Cobra Beer.
Cobra’s Chairman on Turning an Indian Beer into a Global Brand
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