How using the concept of 1000 true fans transformed Huel from a side hustle to an international business valued at £220M
On a damp, grey, February afternoon, I found myself getting off the train in Tring, Hertfordshire and realising it was about an hour’s walk to my interview with Julian Hearn, the founder of Huel, at his new HQ . I had the time, but it was a bit wet and there was a taxi rank complete with a couple of bored looking taxi drivers. What to do? In the end, the taxi option did not seem right. After all, I was visiting a company which champions fitness and wellbeing. I needed to walk the walk before I could talk the talk. 50 mins later, via a pretty country lane, feeling pleased with my choice, I arrived at the home of what some think is the future of food, health, and nutrition.
I had met Julian a few years earlier when he had just launched Huel. I had just heard about it and was immediately fascinated by what Julian was brewing. I had never seen a product like Huel before, and even very early on, it was clear that he was gaining some serious DTC momentum. At that time, I wanted to talk to Julian about the nuts and bolts of his eCommerce setup as we were just starting to step up our DTC efforts at Peppersmith. Julian knows his stuff when it comes to DTC, but it’s the product itself which is the most fascinating part of his business. It was great to meet Julian again, four years later, to hear first-hand his account of the outstanding progress that had subsequently been made
Huel has been described at different times as a meal replacement, space food, the act of vomiting in reverse, the food of the future, beige gloop and memorably as “hipster gruel” by comedian Dave Gorman. As you may guess from these descriptions, Huel is not everybody’s cup of tea, but it is beloved by a loyal army of “hueligans” and cynics beware, the projections are for sales of over £60M this year.
The reason behind the mixed emotions is that it takes a bit of work to get your head around the product. Huel is a nutritionally complete meal in a powdered form. It needs to be measured out to give your desired calorie intake and combined with water it gives you a healthy, quick, convenient, simple, inexpensive meal. Julian was also keen to remind me it was also vegan and eradicated food waste, making it a much more sustainable option than most meals.
While it may not actually be food for astronauts, it is certainly a new take on how you fuel yourself. Once you know what it is, the next question to ask is, who is drinking this stuff? It must be fitness freaks, right? Who are all the people that are buying Julian’s innovation and how he found them is what I had come to find out.
Fitness and health is an obvious place to start. Indeed, Julian came up with the concept when working on his fitness business, but he bristled at the idea Huel is a meal replacement or a protein shake or a slimming aid. According to Julian, Huel is a reaction and an antidote to how most food and drink is marketed and consumed today. His belief is because the main focus on food is on taste and texture, health and nutrition firmly take a back seat. Looking at food in this way is backwards in the eyes of Julian. He explains, “good nutrition is essential however, the right information and access to the right nutrients are so hard to find. Look at the TV chefs they are all taste this, taste that, but they rarely if ever talk about the nutritional make up of their ingredients and meals, even in their cookbooks. The result of this is an epidemic of obesity, health issues and even malnourished individuals who are actually eating loads of calories.”
Julian is pretty hardcore about healthy food, for him, food is either functional, i.e. good for you or it is merely “entertainment food”. He says you can have your Sunday roast, but you need to acknowledge it as entertainment food as it does not contain the optimal amount of nutrients or calories you need. Same with your Friday night takeaway. Huel is the flip of this where the primary focus is on nutrition with taste important but secondary. It is this hierarchy which, instinctively, is the main turn off for those of us who enjoy the whole experience of preparing and eating a meal even if we recognise that what we are consuming may not be the best thing for our long term health.
The unnatural look of the product is the main reason that, while I have always been a fan of Huel, I am not a customer. Chatting to Julian, however, was enough for me to reconsider. When it comes to promoting good health and nutrition and highlighting how hard it is to put the right stuff in your body, Julian presents a powerful case in favour of a change to our eating habits.
Julian is not afraid to be different, and he also likes to put his convictions into action. It was this mindset which had already made him a fortune years before Huel by founding, building and ultimately selling a voucher code website. The idea behind the voucher site was a business he could run from home, avoiding the commute into London, allowing Julian to spend more time with his pregnant wife and when it arrived, the baby. The site was a success. It was soon making millions in profit with just a tiny team doing the work. While it was successful, Julian was also astute enough to recognise this success was probably not going to last forever, so he packaged up the business and sold it on to an American buyer.
Julian picked up the story “This gave me enough money to retire if I wanted. We didn’t go crazy with the money, and I ended up spending loads of great time with my wife and young son. The problem is there is only so much Night Garden you can watch. Most people have the problem of too much work in their work/life balance. I now had the opposite problem.” Julian had itchy feet and was looking for a side project that allowed him to flex his entrepreneurial and creative muscles without requiring him to dedicate a crazy amount of time to it.
Initially, he set up a new business called Bodyhack, which was a fitness website designed to cut through the conflicting advice on fitness and nutrition and sell fitness and exercise programs. To test the fitness plans, Julian put himself forward as the guinea pig and at the age of 40 went from 21% body fat to 11% and said he had never been in better shape. There was a snag however, “The problem was to achieve these results as well as the exercise you have to be really disciplined with your food. I was weighing every single ingredient of every meal to make sure I had exactly the right levels of nutrients and calories. The consistent feedback was that while people wanted the results, they just did not have the time to collect and measure out the ingredients specified. They just could not meet the dietary requirements. The Bodyhack product was not scalable. However, fixing the nutrition problem became the new focus with the solution becoming Huel”. Julian teamed up with fitness coach and nutritionist, James Collier, to come up with a prototype for Huel which was explicitly designed to help get your nutrition right and make it as easy as possible to do so.
Once Julian had the product, which he himself liked and would use, he realised that he only needed a relatively small number of people who were like him and saw the same benefits to build a business. Julian explained his thinking, “I am probably a bit weird, but not that weird, so there must be other people out there who want similar types of stuff. My goal at this time was to have a lifestyle business. I was thinking about the Kevin Kelly concept of 1000 true fans, and I realised that if 1000 people would buy £45 worth of stuff a month then that is a business turning over five hundred grand a year and I could probably manage all this from home. That would be a nice lifestyle, and that was really the concept.“
With this goal in mind Julian set about making a product that people would pay £45 a month for. The other insight Julian had was that he realised for people to buy from him every month, he had to make the experience as personal and enjoyable as possible. It’s a lot of money, and he wanted to make people feel like they were getting good value. With a freelance designer, he created the brand, with its clean, understated feel, designed and bought the packaging and put it all together to make sure the end product suited a Direct to Consumer model.
The bag size and having a product value of £45 per order, was essential to make the distribution and delivery costs low enough to make the margins work. By having relatively low distribution costs, it also allowed him to be able to afford to put a free shaker and a t-shirt in each initial order. These extra touches both enhanced the experience and also meant that customers were soon posting pictures on social media wearing the branded t-shirts and spreading the word when fielding questions about their Huel branded shaker sitting proudly on their desk.
Despite some mixed PR at the start, mainly down to journalists not understanding what the product was all about, word began to spread, and the orders started to flood in. The first 1000 customers were quickly obtained, and it was clear that this was going to be much more than a lifestyle business. The start-up made £750k in revenue in its first six months. This turned into £6 million in its first full year, £14 million the year after, then £40 million last year and is on track for £60 million this year. Customers now order Huel products from 87 countries, with the USA the source of much of their success. The USA is so important that the business has established a satellite office in New York to make sure it can deal with US customer service enquiries in real-time.
The New York office was not the first time customer service was mentioned. Good customer service was a theme running throughout our chat. Being human and putting the customer first is ingrained throughout the company culture. Julian explains “This goes right back to the early days when I hand-signed a thank you note in the first 1000 orders, to when I switched our delivery company when I began to receive complaints about the delivery service. I have two things which resonate with me; the first is to make sure customers are happy, everyone here has that mindset. The second is don’t be a dick and be fucking nice. It’s pretty straightforward”. There is no doubt, he means it, “Don’t be a dick” is written prominently on the office wall outside the room we are sitting in. You know where you stand with Julian.
When asked about marketing, characteristically Julian had some strong views on this. He said his main success in driving awareness came from word of mouth, PR (both good and bad) and Facebook. From early on, Facebook was an important channel for customer acquisition. It was the Facebook “lookalike” feature that enabled Huel to build on its first 1000 fans and find more customers who were like them and would likely also appreciate the products. While Facebook is the main channel, it is one of many that Huel now uses to drive awareness and find new customers. Whether it is Facebook, Instagram, Google or any other, the thing they have in common is they are all digital. Julian explains “Performance marketing, which is anything paid online, is head and shoulders above offline. I hate offline.” Indeed, traditional offline marketing seemed to be Julian’s only regret. “We have tried it all, but no one has convinced me it works”, Julian went on. “You see an ad on the tube, which is great but you then don’t go upstairs, find a shop and buy some Huel. I think there is a disconnect as people don’t know what it is so they are not going to engage in it”.
Maybe this is starting to change, as Huel has just launched it’s first products into retailers. Not the main powdered products, as, according to Julian, you need the whole experience with the shaker and t-shirt to properly get into it. The products they are selling in the supermarkets are ready to drink versions of their shakes and also Huel branded healthy snack bars. Before you start thinking this is just another DTC brand going mainstream and selling in retail, this is not quite Julian’s thinking.
“I would not advise a DTC business to do retail until they have ticked all the other boxes. Retail is a distraction, and you can easily get side-tracked by making retailers happy rather than your end consumers”. Why do it at all then? “Two reasons, first there are times when you want a healthy snack when you are out and about, and as well as helping on these occasions which we can’t satisfy with our powders, it also extends our reach and builds more brand awareness.”
Retail distribution as a marketing tool is not a new idea, but it’s rare to find someone who admits brand awareness is their primary goal. Julian and his team are true mavericks, from the way they operate to the products they make. For me, the things that make it all work are their unwavering commitment to good customer service, delivering a great product experience and making sure they have products which solve a big problem. Julian was right, even if he is a bit weird, he is not that weird, and there are plenty of similar people who value his products. Going back to the question about who actually uses the products, after the hearing his story I was no longer surprised to learn it is not just fitness fanatics and bodybuilders who sign up and subscribe. Julian revealed most of their customers are desk workers, often in tech or creative industries who want a quick and healthy breakfast and or lunch fix. With its unique products, a loyal and growing band of Hueligans and deep international reach, it would seem the sky is the limit for Huel. This really could be the future of food.
