Justine Troy

High spirits

Justine Troy has a short and not-so-sweet message for New Zealand’s business leaders: grow some balls. The co-founder of superstar brand 42BELOW vodka is emphatic that unless they become more open-minded, optimistic and audacious in their attitude toward new ventures, our entrepreneurs will struggle to realise their full potential.
Writing her book Every Bastard Says No, the extraordinary adventure story of how she and husband Geoff Ross took their homemade brand of premium vodka to the world and sold it to Bacardi for $138 million, Justine, 41, became increasingly incensed by what she regards as the business community’s “pathological scepticism”.
“Reflecting on the whole process, I realised it’s almost a sickness,” she says down the line from the family’s elegantly restored colonial-era home in Auckland’s Herne Bay. “We view anything new as something to be feared rather than celebrated. I want to speak out about the lack of support for growth in businesses in this country. I would love to be an agent for change.”
You could fairly say she and Geoff are already masters of change on a grand scale. Born and bred in south Auckland’s Papakura, they bonded as teens over their mutual desire to pursue well-paying careers which would guarantee their freedom. Famously developing 42BELOW’s original blend of vodka in their windowless Wellington garage in 1998, they went on to sell it in to some of the world’s most legendary establishments, including The Ritz Hotel in London and Paris, partnering and partying with a colourful cast of rich and famous characters along the way. New Zealand Stock Exchange chief executive Mark Weldon has praised them for being the first Kiwi start-up to list at an early stage with the explicit purpose of raising the capital required to go global, paving the way for others to do the same. He’s also lauded them for pioneering a new way of marketing, both in New Zealand and of New Zealand. The story’s climax, the 2006 sale to drinks giant Bacardi, netted the couple a cool $32 million for their shares, a sum far exceeding even their wildest teenage dreams. If you think the story sounds like the far-fetched imaginings of some overzealous American scriptwriter, you’re not alone. In the book’s introduction, Justine describes it as, “like a dodgy sitcom with ... layer upon layer of subplots”.
One of Justine’s main motivations for writing the book, other than to give a literal two-fingered salute to the many business ‘experts’ who told them they were doomed to failure (New Zealand Trade and Enterprise included), was to offer fellow entrepreneurs information, advice and an insight in to the “hard graft and intestinal fortitude” needed to build a successful brand. She is confident a “new breed” of creative, courageous and conscionable entrepreneurs will effect positive change.
“When someone is a true entrepreneur, innovative and brave, they will triumph eventually. There are some very clever people in this country who, with a little encouragement from the business community and society in general, will take their great ideas to the world.”
Justine and Geoff were aged 15 and 16 when they met and fell in love at Papakura High School in 1984. In addition to their mutual passion for day-dreaming, the teenage sweethearts shared a taste for the finer things in life. In the book, Justine recalls the day they wagged school, “borrowed” Geoff’s dad’s car and drove to the poshest hotel they knew – The Regent of Auckland.
“Acting all highfalutin’ we walked into the foyer, flopped into armchairs and ordered a luncheon for two. That lunchtime, we planned the biggest life we could imagine.”
Their aspirations altered dramatically over time, but were always large-scale.
“At first we just wanted to get out of Papakura. I think it [building a successful business] was always going to happen. We were hungry for something and knew we had the passion and work ethic to apply ourselves to something huge.”
Geoff spent a year in the US before starting a Bachelor of Commerce degree at Christchurch’s Lincoln University. From a farming family, he originally intended to major in farm management but switched to marketing when he learned top advertising executives could earn more than $100,000 a year. He worked in advertising for eight years before coming up with his $138 million idea – and continued to do so until 42 Below scored a major cash injection in 2001.
Meanwhile, Justine trained to become a speech language therapist at Canterbury University which, based in Christchurch, enabled her to re-establish her connection with Geoff. Eventually realising the job would never make her entirely happy, she joined Geoff in the seductively glamorous and lucrative world of advertising. She wound up as an account director for top agency Colenso in Wellington (Geoff worked for Saatchi & Saatchi at the time) but found the work so uninspiring that she quit and enrolled at the London School of Journalism.
“In a move defying marital convention, I spent nine months alone, studying and travelling,” she explains.
Back in New Zealand, she landed her dream job, researching and writing documentaries.
“I had to take a few major U-turns to find the thing that really fulfilled me. I took a big pay cut to sit on a reception desk so I could help with a research project, but I was prepared to suck it up to get where I wanted to be. I think women need to be braver in their career trajectories.”
She made documentaries for the likes of TVNZ and TV3 before the business she has since likened to a first-born child commandeered her attention.
Geoff conceived the idea that became 42BELOW on the flight home from a business trip to Vancouver. Flicking through a magazine, he was confounded by an ad for an American brand of vodka. Thinking the spirit really should be made in a country with cleaner, greener credentials like Finland, Sweden, Russia – or New Zealand – his entrepreneurial brain went in to overdrive. He’d craft a classy product, give it a cool name and stick in a stylish bottle highlighting our nation’s glorious natural assets. Easy.
Sharing the idea with Justine on the drive back from the airport, she too became exhilarated.
“We were frantic, excited, steaming up the windows,” she says.
But Geoff was soon sucked back in to the corporate whirlwind, leaving him little time to devote to the embryonic business. Taking control, Justine began researching vodka production methods and phoned her ‘Poppa’, a home-brewing veteran, for advice. He told her all he knew and put her in touch with his supplier, from whom she purchased their first still. Installing it in their garage, Geoff spent the next three years perfecting the recipe. By the time of the sale to Bacardi, 42BELOW had won more taste awards than any other vodka on the planet.
Much has been made of 42BELOW’s edgy and highly effective marketing tactics, which often pushed the bounds of acceptability. Their print, radio and TV ads and viral marketing stunts, many of which were driven by ad guru Darryl Parsons, were variously labelled racist, sexist and homophobic among other things, but they made the world take notice. A series of 2003 radio ads, for example, referred to Maori trading muskets, blankets and hobbits for copious quantities of vodka and linked the company with the All Blacks, the America’s Cup, the Shotover River and Russell Crowe. To maximise the ads’ exposure, the 42BELOW crew matched them to images and emailed them to contacts around the globe. The ads generated innumerable complaints, a rebuke from the Advertising Standards Complaints Board and a law suit from Crowe. They also generated priceless worldwide publicity.
Believing good marketing is a by-product of a good company culture, Geoff constructed a David and Goliath-type story for the brand. He encouraged the team to think of themselves as underdogs who would take on the corporate giants and win. Given their shoestring budget, they would have to rely on their wits, charm and irreverent humour or, as he put it in one company memo, their “rock star personas”.
“We should carry our briefcases like a guitar, dress like a rock star and deliver our story like a rock star,” he wrote. “Have that supreme confidence to deliver our message in a way that sounds as if we are the most successful spirit brand, ever, in the world. This is self-fulfilling.”
Justine attributes the company’s superb, fun-loving culture to two key factors.
“First, we were a family so there was a huge amount of loyalty and love and care. The mainstayers are all fundamentally good, compassionate people and great leaders. And secondly, the culture was hugely celebratory. We were well-known for our ability to party – hard.”
Their innovative sales tactics were also instrumental. Geoff started by cold calling bar owners in Wellington, politely enquiring whether they’d like to try the product and offering to help develop a cocktail list. If they knocked him back, he’d think of something to sweeten the deal. For Q Bar, he created giant Perspex displays filled with vodka-infused plums and vanilla sticks for a special event and drew a big blue line across Courtney Place to the doorway.
Back then, the couple were part of a social scene known as Rent-a-Crowd – a posse of party-loving young professionals who helped them instrumentally by demanding 42BELOW vodka (often very loudly) wherever they went.
In 1999, after three years of part-time development, they officially launched the brand at hip Wellington bar Brava, owned by a Rent-a-Crowd mate. The following year, they moved back to Auckland and embarked on what Justine calls the business’ high-growth phase, kick-started by their first ‘angel investor’ Howard Phillips’ $40,000 cash boost.
Sales continued to grow steadily, but it wasn’t until the brand attracted the attention of overseas media that things really took off. A young Kiwi bartender with a taste for 42BELOW took a few bottles on his big OE, some of which found their way into the offices of respected trade magazine CLASS. The mag ranked 42BELOW second equal in a blind taste test and local media soon came clamouring for what they dubbed a classic Kiwi success story.
But for all the media attention, the couple, who were living in a worker’s cottage on Geoff’s parent’s farm to save money, were struggling financially. Their unlikely saviour was Grant Baker – a proudly hardnosed businessman with expertise in financial management and sales. Deciding 42BELOW was just different enough to succeed on a grand scale, he offered the couple a $430,000 loan for a 51 percent share. Realising it could represent their only chance to take their business to the world, they accepted and Geoff was finally able to give up his day job to focus on the business full-time.
Grant’s skills and experience enabled them to ramp up their production and export sales and he was a driving force in their decision to list the company on the NZX in 2003. They valued the company at $60 million (although it was yet to turn a profit), $15 million of which they offered as shares at 50 cents each. It was a brave and controversial move, which attracted a huge amount of criticism from the business community. As Weldon has said, “[t]here was almost a ‘you can’t let this thing list’ campaign.”
Among the innumerable bastards who said ‘no’ however, a good number of ma and pa investors said ‘yes’. Their initial public offering was oversubscribed (just), netting them $15 million to put toward building their global empire.
From there, the team focused on growing the brand in the Australian, UK, US and Asian markets, conquering them one by one. By the time of the 2006 sale, the company was exporting 65 percent of its vodka to 25 countries.
By this stage, 42BELOW was widely acknowledged as a creative pioneer. It was named Emerging Exporter of the Year at the 2005 NZTE Export Awards and took out the 2005 Deloitte Fast 50 Fastest Growing Company of the Year Award.
A highlight of the whole profound and invigorating journey for Justine was the extraordinarily exhausting, intense and exciting years the family (she, Geoff and two young sons Finn and Gabriel) spent in New York.
Another standout was the day she and the boys popped into The Ritz in London to meet Geoff after a business meeting and found the staff lined up to shake their hands. “It turned out they all knew we were coming. The bar staff was thrilled to see us and show off the cocktails they’d created with our vodka.”
As intrinsic as the business was to their existence by this stage, they decided the Bacardi offer was too fantastic an opportunity to pass up.
“As long as we didn’t stuff it up and squander [the money], we knew we were set for the rest of our lives,” Justine explains.
The sense of loss they experienced post-sale, however, was even greater than they’d envisaged.
“Selling your baby when it’s ten isn’t easy, no matter how much someone is willing to pay,” Justine writes in the book. “The life and times of this particular offspring came to define our family and many of the 42BELOW team all over the world. When it was gone, we had to find out who we were again.”
To give them the time and space to do just that, the family enjoyed a lengthy European ‘adventure’. Supporting Team New Zealand at a regatta in Majorca, they happened upon a 42BELOW stand, immediately spotting the ‘vodka professor’ of the company’s eponymous ‘university’, sipping on a cocktail while playing a round of chess.
“We joined forces and had the most magical, unforgettable evening,” she reflects.
Justine appreciates how privileged she is to be able to choose how to spend her time these days. She is enjoying being able to devote more of it to her two glorious boys, whom she describes as, “like a gift I get to open every day”.
“Our team of four just get on so well together. Geoff and I are completely involved in the boys’ school lives and we all love the outdoors. We go tramping and fishing and camping. I’m actually a big believer in what the Italians call ‘the beauty of doing nothing’. It clears the mind and feeds our commercial endeavours.”
While she’s a strong advocate of leading a balanced lifestyle, her passion for business, writing, charity work and of course her family make it challenging to say the least.
She’s proving a prolific writer, working on two new books and contributing regular articles to magazines including Metro. She also does a lot of charity work – she’s a big supporter of the New Zeal Foundation for at-risk South Auckland youth, and is passionate about helping charities become better businesses.
She, Geoff and several other ex-42BELOW crew members are also now heavily involved with ‘eco-luxe’ home fragrance, body and bath company Ecoya. In addition to being shareholders, Geoff is the Australian-based company’s executive chairman and Justine is a brand ambassador. Already well-established in Australasia, the company is also doing well in the US and Asia, aided considerably by the ex-42BELOWers’ VIP contacts. Ecoya’s aggressive growth strategy has seen it list on the NZX, acquire skin and hair care brand Trilogy in a deal worth $20 million and develop an array of new products – all in the past seven months. Interestingly, Justine says the process of taking Ecoya to the NZX wasn’t much easier than it was with 42BELOW.
“Even with a proven track record, we had to put in the hard, hard yards. The financial services industry is still very sceptical.”
She is still invigorated by the challenges and adrenaline rush of growing a brand.
“It’s really exciting to be taking a new brand to the Northern Hemisphere,” she enthuses. “Neither Geoff nor I intend to be one-hit wonders. We feel privileged and proud to be able to apply what we learnt with 42BELOW to growing another global brand.”
Their successful personal and professional partnership seems to result, in large part, from their shared ambitions and different, albeit complementary, personalities.
“Geoff is quiet and considered and humble and I’m the exact opposite,” Justine says. “He loves my energy and optimism and I admire his grace. But basically it all boils down to the simple truth that when he walks in to a room, he’s all I see. I pretty much just want to be with him.”
Lorna Thornber