Meet the founder of Centimeo
Benjamin, you've recently been named on the Forbes “30 under 30” list for the brilliantly simple Centimeo. Could you please tell our readers everything they need to know about the man behind Centimeo?
Well, I would define myself as an “idealist” entrepreneur, as in I never wanted to launch my own company before having the idea of Centimeo, and being an entrepreneur was definitely not part of my plan. I am fascinated by the world of ideas and concept – as many political philosophy students – and I was not part of the business students looking for ideas in order to build up a business. What led me to be involved in this amazing entrepreneurship journey is the identification of a social problem that I wanted to solve, with an economically viable solution. This is the beauty of social entrepreneurship: being able to find sustainable answers to social problems, which was very attractive for a young philosophy student.
The issue I identified was an inefficiency of the monetary circuit in Western Europe. Basically, because of European solidarity, we need to keep small Euro cents coins for the countries that need them. However, they are mainly unused in Western Europe, so that, in order for the shops to give back change, European states need to manufacture every year over 1 billion of 1, 2 and 5 Euro cents coins. The problem is that this is extremely costly, since manufacturing a 1-cent coin costs 4 cents to the States. Moreover, shops need to pay security vans to get those coins, and the logistic for such a heavy weight – and a low value! – is very costly. So finding a way to enable people to use their small coins in order to recycle them into the economy became my obsession!
Could you explain the Centimeo concept to our readers?
Centimeo’s concept is extremely simple. To get back the 1, 2 and 5 Euro cents coins, we are operating a network a small vending machine, selling popular ecofriendly products per unity, like organic chewing gums for 5 cents, fair trade pieces of chocolate for 10 cents, locally manufactured pieces of caramel for 5 cents, or organic cookies for 10 cents. After getting back those coins, we sort them, and put them into monetary bags. Then, they are recycled in the economy directly via giving change to shops nearby our vending machines, or in bank branch.
Our business model is also very simple: the investments are very limited thanks to very easy 3D-printed mechanisms, operational costs are low because of a big capacity in products, and margins on the products we sell are high. We are indeed not selling or renting the machine, all the business is based on the margins we make on the products sold. It requires that we install our machines in spots where there are many potential buyers. We have thus a lot of machines in train stations, hospitals, universities and shopping malls.
At which point did you start to believe that Centimeo was a viable business idea?
One usually says that it is crucial to be obsessed by our business ideas, but it is very important to be able to base this obsession on small business achievement. I had straight away the intuition that it would be a viable business, by thinking that since there are a lot of unused coins, developing a way for people to use them would automatically attract customers. I really believed that I was right when I installed my second machine, which was in a shopping mall. After a few days, this machine was selling over 200 products per day that is almost one every 7 minutes! This strengthens my intuition.
How would you describe the journey from conceiving the Centimeo idea to launching the actual brand?
This journey was relatively short. We encountered some technical delays since there were not any similar machines on the market so far, but I wanted to try the idea as soon as possible. Right at the beginning, my first machine was only selling chewing gums. And we did not have any chewing gum supplier! So, I had to buy gums in a supermarket, remove the packing and put them in my machine. By that time, I was buying gums 10 cents, and reselling them for 5 cents. But my point was launching super fast the brand, and then enhancing it through the market experience. It is indeed the difficult part of innovation: we never know what will happens, and building the brand per our observation on the market looks like a more efficient strategy compared to trying to anticipate the outcomes of an offer, which is completely new.
How has the public responded to Centimeo?
Centimeo’s concept became quickly popular in the spots where we were. Although our first machines were poorly designed – and managers of the buildings where we had our first spots were usually complaining a bit about how our machine were old-stylish – the public found the concept enjoyable. A chewing gum for 5 cents is super cheap, and customers had the feeling that they got a good deal. We had the image of a friendly company, with a smart idea, and many people contacted us to know more about Centimeo: they were super curious to learn how a company could be viable only based on the resource of Euro cents!
Were there any obstacles that you encountered which were difficult to overcome?
The adventure of Centimeo is a series of obstacles, and even from the beginning. Not being an engineer does not help to develop a vending machine prototype. By that time, many people believed that Centimeo could not be viable, especially bankers and business angels, so that I had to find a solution to launch it with only very few monies. I decided to buy a one-way-ticket to India, hoping that developing my machine there would be less costly. But I did not know anyone there when I arrived, and I even did not have support from my family, so that I had to work to make some money, to be able to find an accommodation, and eat.
I spent 4 months there, going from doors to doors to ask people if they could develop my machine, or if they knew anyone that could do it. And the way I got the contact of the small company that became my first supplier was very unexpected. I contacted a teacher of mechanical engineering in Chennai, that replied me that I was too young – 20 years old – and that since I have no engineering background, I would rather go back to France. I replied him that this idea was worth fighting, and that it was irresponsible from him to have such a reaction towards entrepreneurial initiative. He dropped me an email the next day, saying that I was lucky since he met someone that could help me. And this contact became the manufacturer of my prototype and my first ten machines.
We faced many other difficulties, such as finding a chewing gum supplier when we were only able to buy few kilograms of it, or implementing vending machines in public areas, which is a super big deal in France and takes a lot of time. But all in all, these difficulties contributed a lot to develop our offer and our concept.
What's your strategy to ensure that the brand keeps growing?
Our growing strategy is focused on keeping being the only actor on our segment, to get all the markets and expand fast. To achieve this, it is crucial for us to put under pressure the potential competitor by reducing the price of the products we are selling, and our operational costs. This is possible via keeping improving the distribution system of the machine, to make it more efficient. The 3D printing technology, that we introduced last year in our machines, helps us to be extremely flexible on the mechanisms, and to implement the improvements very quickly. Thanks to it, we doubled the capacity in products of our machines, we facilitate the filling of the machine, which takes now less than a minute, and we sell products with smaller packaging, that enable us to divide by two our average price.
We invest also a lot in the packing technology of the products we are selling to maintain an extremely low price, in order to make it difficult for potential competitors to be able to offer the same conditions to the final client.
Finally, we focused also on referencing new products, such as hand sanitizer, or even organic coffee, that we plan to launch next year for a selling price of 10 Euro cents!
What are some of your top tips for attracting investors?
What has been super helpful for us to attract investors is to try to put ourselves in their position, and to speak their language. For Centimeo, it is quite easy since our model works as a renting model: we invest in a machine that will have a constant revenue that we can forecast over years, and the money we raise will be used to fund tangible assets.
It is also very important not to neglect the impact of communication on investors. A significant media coverage will be a good backup for the investors’ decision to invest, and will raise the attention of many potential investors.
What advice would you give to any young entrepreneur struggling to get their idea off the ground?
I guess that the most important for a young entrepreneur, is to try to make his idea concrete the fastest possible. I am not a fan of entrepreneur’s quote, but I fully agree on the one of Reid Hoffman: “If you are not embarrassed by the first version of your product, you’ve launched too late”. This is true, one of the main problem encountered by young entrepreneurs is that they think that they need a lot of money, or to launch the perfect product. This is a huge mistake. One should not fear to build up its first vending machine out of cardboard, or to cook himself his first cookies instead of spending a lot of money to buy tons of them to a manufacturer. Being an entrepreneur does not mean to be able to start big, it means to be able to test his idea with the least possible. If you want to build up an e-commerce, do not start by buying the products you will sell. Sell them first, and figure out after how you will buy them.
It is also important to keep in mind that business plans do not matter at all at the beginning. The best business plan to convince investors or partners is reality. The question is not whether you will sell a hundred cookies per day per the figures, it is whether you actually sell them. Entrepreneurship is about doing simple trials that might seem ridiculous, without feeling ridiculous. Many entrepreneurs think that it is complicated to start the business, and at that point, it is very important to figure out the simplest, fastest and cheapest way to start. And the result is sometimes very surprising, and always very instructive!
We have the same problem here in the UK, do you plan to take the Centimeo solution overseas?
Yes, definitely! We are trying the solution in Germany and Italy currently, and the overseas development, including the UK, is part of the plan in 2018. Exporting is for us a main challenge, since the vending machine business is usually extremely “local”, and there are only few companies that managed to become international. Developing overseas a physical distribution network means a strong operational organization, and a truthful management. It requires also to understand the specificities of the British, Italian, and German markets, since we are dealing with local actors, even though we expected these markets to be more business-friendly that the French one, in which the public sector is strong, and the implementation of private companies in public spaces still a taboo.
When you're not working on Centimeo, what else do you enjoy doing?
I spend most of my free time on my other passion: reading books and writing articles about determinism and stochastic, which are questions that are interesting me a lot. I also enjoy practicing judo; it is a very good way to release the tension of an entrepreneurial life. And whenever I can take some days off, I cut off with the technologies and go backpacking!