№ 20 – Fragrance Entrepreneurship with Demeter CEO Mark Crames

For the first time on our podcast, we dive into the entrepreneurial journey of a brand owner who not only helms the creative vision but also owns the manufacturing facility. Meet Mark Crames, the innovative founder of Demeter Fragrance Library. Mark brings a distinct business model to the fragrance industry, contrasting sharply with many traditional brands.

Book Inspirations from Mark:

• The Great Gatsby
• Demon Copperhead by Barbara Kingsolver

Explore Demeter:

• Visit Demeter's Website

Thinking about your own fragrance journey or need guidance? Connect for a coaching session with me, Tanya Mironova:

• Book a Coaching Session
• Email me directly: tanyastube[at]gmail[dot]com

Ever dreamt about going to space? Connect with Tanya!

• https://www.instagram.com/neparfumer/
• https://www.coachmironova.com/

Transcript

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actual story of the right pronunciation, please. The correct pronunciation is Demeter, the European pronunciation of the Greek goddess of agriculture. The company was started in 1996 and by 2002 that had been Americanized by the time I bought it already to Demeter. I spent a couple of years trying to fight that and then gave up and Demeter it is. you oh and welcome to the How I Became a Perfumer podcast. In each episode, we explore the different roles in the flavor and fragrance industry, as well as talk to founders of independent projects. My name is Tanya Mironova. I'm a career coach committed to helping you sniff out the best opportunities and inspiring you to embark on your own projects. If you got stuck and looking to make a career shift or start something new, don't hesitate to book a session with me. could find all the details in the description box. Today we are speaking with Mark Kremes, a name you might not know directly, but you will definitely recognize his impact as the CEO of Demeter, yes the pronunciation is Demeter, fragrance library. Mark, welcome to the show! Thank you, I'm so happy to be here. Well, likewise, we are happy to have you and you're a very special guest from many angles and we will be exploring some of them today. I would like to start with a question which, you know, I was thinking about quite a while. Our listeners might not know you are in fact an investor in the fragrance industry. Probably. Yeah, I already see you want to contradict something, but I, well, in my mind, in my head, your role is different. comparing to many other people who I've been interviewed because some of them are founders like in a very uh straightforward way and some of them work for corporate environments, but not too many decided to buy a company. So how do you feel about this role? You know, I don't think of it that way because it's not like I bought multiple brands in multiple companies. I started one company and I bought one company. So I don't think I think of myself more as an as an entrepreneur and an and an operator than than a financial guy. The company I had started a company called Noiding Group in America that I ran for 17 years as a fragrance distributor. So I went from fragrance distribution where we actually licensed brands like Pierre Cardin and produced them. So we started out producing, distributing the more typical designer brands that everyone carries that evolved into licensing our own brands and manufacture our own product under license. And the natural progression for me just as a business person at that point. was and and in the fragrance industry was to move into really ordering my own brand. So that that was that was the business piece of that progression but it was actually more personal things that showed the decision-making. huh, I see now. I knew that I wanted after distributing for 17 years and being on the creative side as an evaluator and managing the creation of new products, I knew that I wanted to have a brand where I could do the things I wanted to do with less restriction, where I can have more freedom and more control. My previous company had grown to a size where it was no longer and I had partners. it wasn't, I couldn't follow every whim that I wanted to. And I wanted to follow those whims in an olfactory sense. There were things I wanted to do in fragrance that were not necessarily the best business decisions, but were reasonable. And I needed to be on my own and independent to do those things. But know, quite often, believe after a while, after working in the fragrance industry and seeing all the ins and outs and you were really in distribution, it's one of the sides of the industry where a lot of people finding themselves, they really got disappointed because of the way things are, there are no butterflies and you still had this idea and this willingness to keep working on a fragrance brand. When I look back on it, it's a normal sequence of events in the sense that The whole story is that I started out as a trademark lawyer Managing trademark issues for other people all over the world in the fragrance industry Just happened to be the fragrance industry didn't have to be but it was and I fell in love with it and I learned a tremendous about a man of out it during my legal period. And I actually, my first job in the fragrance industry was in-house counsel for one of my fragrance clients. I then ran a division for another fragrance client. And it only then that I started my own company. ah But I went from fragrance lawyer to fragrance lawyer in-house, to executive with a legal background running a fragrance division, to finally buy my own, starting my own company that would distribute fragrance. And I started that company with my brother at a bridge table in a spare bedroom in my loveliest house with a single-lined phone with call waiting and a manual rolodex. That was our capitalization. was $4,000 I borrowed on my credit cards. And when I sold that company in 2002, it doing over $100 million a year in sales. Well, that's pretty inspiring and I believe it's also interesting to connect all the dots afterwards. m because they certainly, there was no way you could have connected them looking forward, how I worked my way from water to perfume. Well, I wonder how did you feel when you actually bought a company. Now it's time to do things. To do things, believe, wasn't Frank Sinatra's song Your Way? But I can say that I didn't do things my way for a very long time at my older company, but they liked distribution and I liked making stuff. So there came a time that it was time to separate. And I think I was excited about that ability to pursue any idea that I wanted, that I had reached a point in my career where maybe I didn't have to compromise. Mm-hmm. What I didn't fully appreciate was how many other compromises I would have to make for that to work. huh. because there are certain perks that come with running a hundred million dollar company that don't come with running a much smaller entity. So I'm very fond of saying that buying Demeter was the best life decision I ever made and the worst financial decision I ever made. Perfect. I love this combination. So about the best part of the decision, we will definitely talk about, but the worst financial decision. So maybe if someone just sitting and listening to this episode and thinking, I will sell my previous company or I will just quit my job as CEO of something huge and buy maybe at that point, small fragrance house to do things my way. So what would you tell uh could be the financial obstacles? Well, used to have a friend of mine, uh David Mugen, who was one of the founders of uh the company that created Nicole Miller and Alfred Sohn. He used to say that people would come to him all the time and say that they wanted to be in the fragrance business. It was so cool and sexy. How do you make a million dollars in the fragrance business? And David's answer was show up with 10 million dollars and you'll leave with a million. It's like with the wife, right? So uh it's a cash intensive business and it has become much like movie making. ah It's too expensive, you can't afford to fail. So everyone queues to the middle and then you've got a couple of independent people running around with really cool ideas that are either self-financed or so expensive that only a few people get to experience them or they're narrow-casted. I flavors is the same way. There are independent houses in wrath, but we're few and far between. And if you're not creed or artisan perfume or haven't been around with 150 year base, that's difficult. If you're not backed by a much larger financial entity, and we're backed by me. You know, so we've stuck the last 20 years, you know, we have no choice. We compete with the Dior's and the Givaldi's of the world. There's no other way to, you know, to really be in the game. And because we have this unique fragrance proposition, I've always felt very constrained about our price points. We represent. You know, one of our key type stones has always been accessibility. Well, you're not accessible if you're not affordable. Since it has been like 22 years you're owning the company and building a strategy and everything. Have you thought about changing it? I mean, the financial aspect. Well, we are. But the core dynamic is for an independent fragrance company is it's always going to be a fight. Some years will be better than others, some will be worse. But if you're independent, it's going to be a fight. Yeah. And talking about your independence and now a little bit about the creative, the creation point. You said you had worked as an evaluator previously in your previous company and I believe you of course brought these skill sets to a new company. But you actually needed someone to be creating fragrances for you. So who, if it's not a secret, who were these people and maybe how did you find them? Let me put the round edges on that story. Okay, when I say I was a fragrance evaluator, I was an evaluator starting out just like anybody else. I didn't have any formal training. I was buying the fragrance and like the owner or director of any other company, know, I wanted that fragrance to smell a particular way. Over time, it turned out that I was a very good evaluator. That was just... you know, not something that I knew from any part of my previous life until we started working with Pierre Cardin, which was the whole experience in itself because he was a trip and a half. That's almost a whole other, another pond cat. So when I was looking for a vehicle, I found Demeter. Demeter at that time was insolent. It was, it had had a, it was like a shooting star. It been on the market for a few years. Everybody loved it. and the guys who created it were incredibly creative. This is a concept I would have never thought of if you gave me 200 years. I could imagine, yeah. It now might be not that obvious to the listeners, but I'm pretty like, I've sent, like first smelled the perfumes 10 years ago and I was shocked even then. Well, even in this day, when the concept of single note fragrances is no longer strange or foreign, nobody is making single notes like we are. The philosophical approach to fragrance, idea of uh boto realism on the perfect olfactory moment, no one else is going for that. They're still making perfume. So it really is a very radical concept in that regard. So Christopher Brochus was one of those, one of the founders and he had been a self-trained perfumer at Kiehl's. And he was the original, so he was the original perfumer at Demeter. And when I bought Demeter, we originally started working together those first few years very intensely in the same way that I worked at Norman Groot. except I wasn't working on one of two fragrances, we were working on 10 or 20 or 30 or 50 fragrances at a time. I became a very, very good evaluator. And I started working with Christopher learning a little bit about perfumery. And Christopher had an interesting philosophy that the art of blending fragrance is all about scent memory. that you simply, if you can remember what something smells like, understanding what it goes with is not going to be terribly difficult. I'm not going to say that's true or not, but that was his philosophy. And that was a comfortable philosophy for me being an untrained perfumer. So it was attractive to me whether it was right or not, and I ran with it. So after that five years, Christopher probably under a of the same feelings that I had when I bought Demeter now felt constrained. He no longer wanted to do only uh single note perfumes. He wanted to do more complex fragrances, which to me are just more traditional, it's for humor more challenging maybe. And we parted ways. And at that point, after about five years, it was up to me what we were going to make, what we were going to do. I evolved into finding different perfume houses that I would work with on different kinds of fragrances. For example, Unger did fantastic chocolates and fruits. I use Givinein. everything really well, but they're really expensive. So I only use them when I have no alternative. I use different people for fruits. I use Charlebo for vanilla. They do the best vanillas in the world. So I've learned what I'm comfortable with, that different people have different expertise. And I do have a couple of perfumers who I really like that I work with around the world. ah I do have people I tend to go to, but I think more in terms of companies and company knowledge and expertise. I haven't said that there's a couple of people who I think their hands are so fine that I like working to Well, thank you for that, for elaborating on that. So feels like you're sort of a creative director. If you were not the CEO, we could tell you that way. I really think of my role at this point was chief perfumer. I and very much that is about directing that part of the creative process because I'm less involved in the packaging side. less involved now on the marketing side. my boys have taken over a lot of those things, but fragrance is still mine and. About 25 % of the fragrances we sell. I have actually done the blend. So uh very often the fragments will be created under my direction and then I will modify it further in-house. about 25 % of the challenge. You got a, like a sample or like you got a formula and then you just like, I don't know, look at it, smell it and say what we're going to add or what we're going to, uh, like. Right, and that's a trial and error process. you know, and several of our fragrances are, like I said, about a quarter of them are made that way. That I've taken the oil that was made under my direction and modified it further. 75 % I'm just managing the concentration at that point. Yeah, that's very interesting. that the perfume is on the work. But well, it does come with a lot of responsibility. So was it a natural thing for you or you developed it like, you know, maybe you had mentors, advisors, who, who, what's ever. So at what point you decided that I can do that. No, it evolved very natural. huh. Well... And again, you know, once you have a couple of commercial successes, it's easy to believe that you know what you're doing. And sometimes you're doing, sometimes, you know, not everything has the same amount of success. But with over 20 years now of making fragrances this way, I think I have enough commercial success and uh enough reputation that goes with it that people think I do this pretty well. I have people who are like trained perfumers, like trained, as long trained as you could imagine, but they still don't have this authority over their choices and don't have this belief you have. And this is very interesting. I made a lot of choices to make that possible. So I get to do the thing that I love to do. I don't really get to make the kind of money you used to make. And that was a reasonable trade off. I was never after the money. You don't want to make a living, but it was not once I had made this decision, it was no longer a financial decision. It was. And it wasn't even a creative decision to be honest, that was the secondary part of the decision. The primary part of the decision is I had remarried at 40. and had my fourth child, first one was my current wife. I had three older children for my first marriage and they were in their teens and I felt like I had spent all that time running around the world building this wonderful business on the road three, four months a year, you in the office early, in the office late. And I turned around and there were teenagers and I missed all that stuff. And when I decided to leave that company, it was to buy something that I had a very particular focus. I wanted to work from home. At that time in the early 2000s was really the first time that there was enough connectivity for you to think about having a remote company. And we're really on the bleeding edge of the envelope when we did it. but I took a group of people that I had from my previous company, my chief information officer and my creative director, and my wife who was just simply my right hand, and we bought Demeter. And our philosophy at that time was we wanted to build a company where we could wrap our work around our lives. and start wrapping our lives around our luck. We wanted a better work-life balance. And we wanted to make a living while we were doing it. I got the work-life balance part better than the living part, but it seems to be working out. That was a small fragrance company. It's just a challenge in this environment. I always wonder ah how have you been finding people for your projects? I believe for Demeter, for maybe other projects. Because in your interviews, you really emphasize how important it is for you as a CEO to have people who really like your family kind of thing. Well, in my case, they actually were our family. So that explains things. um Is it difficult to uh work with your family? It's very rewarding and very difficult because everything's more charged emotional when you're when you're working with strangers, know, you know, obviously not strangers if you're working with them, but but without without those that long history uh You develop your work relationship and it's at a professional level and Relatively straight told in a family business. It's a possible to separate the emotion from the work. And that is both beautiful and terrifying. Everything feels like it's high stakes maybe that it really is sometimes. A lot of people usually give advice like never ever have business either with your family or friends and we all still do Because when it works, it's the best. And when it doesn't work, it's the worst. And I've had both. Yeah, I could imagine. Well, returning again to one of your interviews and finding balance in life, I really liked your quote. You said that you should have at least one hour per day for yourself in any ah capacity. Like it could be yoga or it could be walking, I believe, or whatever to keep yourself uh motivated, I believe, or to keep yourself just in a good shape and mental. in a mentally good shape, not on the physical. I was actually thinking more sane. You're under so much pressure running any business. And in many ways, I think a small business more so. I run both. And in a big business, my job is managing people. In a small business, I have to manage people and do stuff. A lot more stuff. So I don't find it, you It's a lot of pressure. taking that owl, and for me it's about getting out in the woods with the dog. The best thing for me is that how we're outside, in nature, and if I have my dog with me, do you need that? Perfect. And that really is emotionally and mentally renewing for me. uh I um also had a question about your facility because you mentioned it and I know that I jump from one subject to another, but do you understand correctly that you have your own production spot, I would say, or you have your own factory? And how does it feel to own your own factory while many companies just outsource it to some other factory? If I could figure out a way not to run my own factory, I would do it. But this brand doesn't permit for that. I mean, if I wanted to make more money, I would take down our 300 fragrances and cut it down to 50, even 30. I'd streamline the company. I'd get rid of some people. We would reduce our expenses. We'd focus our marketing on a handful of things and we'd make more money. and the company would be the worst for it. I got it. Well, I could say my thoughts about why you don't do that, but please elaborate on why you not doing that. course, that's not the mission. The mission here is not to make the most money possible. The mission here is to make great wearable fragrance available and accessible. And that's what we want to continue to do. And that's what my boys are going to do. And I'm not here anymore. So, you know, we're not a prestige brand. We're not expensive. We're available for anybody who can afford to use us. And I want to continue that. That's a great family tradition. Yeah, and it's also great purpose. It's hard, but I think it's worthwhile. And like I said, no one else does what we do. Even though other houses are working more with single-mode fragrances, they don't think about fragrance the same way. It still comes out smelling like perfume. Some redacted version of the thing itself. When I do a flower, I'm... I'm doing Jasmine. I want you to feel like you're standing in the field of Jasmine. Living. Breathing. Everyone's doing impressionism and we think nature is just the world is full of beauty and doesn't Needs to be captured not modified That's a good one. What do you think are going to be if there are going to be any next launches? know, the pandemic really threw us off on our launch schedule and we haven't really recovered yet. We just launched Oak recently, which is the first wheel, only the second or third single-node launch we've really done since the pandemic. And I'm really happy with that. That one's particularly beautiful, deep and rich and luxurious. uh And I'm first now really starting to refocus on how we want to go forward and hear Fragments. All I can tell you is that I want to be four new fragrances next year. I can't tell you anything yet about what they're going to be. um Check back in about six weeks. Hopefully I have some answers for you. Perfect. Thanks. got you. Before we go on, I proceed to the bleeds section where I will be asking you some questions and expect you to answer them kind of fast. I want you to give a piece of advice maybe to somebody who is not secure about their ability to start own project or to invest in a project. Just a general piece of advice because I believe you've like had experience of talking to hundreds of founders maybe. And you definitely, and I feel that you definitely have your opinion on what differs people. I have opinions on everything. For better or worse. Oh, that's good that you have that. Well, if you meet a founder, somebody who is asking like, Mark, how did you do that? Could you please be my mentor? um I'm just hesitant or something. What do you feel like about these kinds of questions if a person addresses you? I have a very simple philosophy and I share it all the time. Make a decision. right right or wrong you know look at the situation don't agonize over it make a decision it'll be right or wrong and move on to the next decision you will be right more than wrong and you will be fine that i've seen way way more there are a million ways an infinite number of ways to do business right not my way it's not your way but move forward if you don't move forward you can't win if you don't take risks you can't win and don't be afraid of losing. Losing just means you get another chance to win in a different way. We're not defined by our successes and our failures, we're defined by the process. Just go for it. Well, we could have finished right now if I didn't have blitz questions, but it's a good one. Thank you. I'm happy I've asked you that. And frankly, I feel like there is a lot of mentoring potential in you. I think I am a natural teacher. It's just the way I like to explain things and I have strong opinions and that can create problems. uh Well, then you might have students who will just fight your opinion. It's also good, I believe. It's better to have a strong one. All right, so my Blitz questions. The first one. Favorite Demeter scent you've worked on? The Troy. Wow. That's my personal favorite. And I think that truly historically has gotten a really bad rep because back in the 60s and 70s and 80s, even the 80s, there was a lot of cheap synthetic Petrulli floating around. And when you get natural high quality truly like Tom Ford's white Petrulli or always our class Petrulli, which is all natural. It is just beautiful the way I think almost no other. material is. Perfume itself, perfume in itself, I believe some people call it. lends itself, it just cries out for you in a way that no other maturing does. It just calls to me. You're right. And it's a difficult material to blend with, so I like to use it mostly by itself. one cent you wish you could capture perfectly. we've gotten to a couple of them that were hard, particularly puppy's breath and kitten's fur. Wow. Were two that I worked on forever before I was able to get them. think if there was one thing that I would like to capture that I've never had any success with, I would love to be able to do a savory fragrance that was wearable, like a turkey or a roast beef that was still attractive and wearable. and I have never even come close. The closest I've come was pizza and I don't think it's wearable. It's a pretty phrase, but I don't think it's wearable. The other one I would like to get, I'll give you one more I'd really like, bread. Especially baking bread. The restrictions on the material palette now makes it really, really difficult to do bread the way I'd like to do it. I was able to do a good pretzel recently, but I still can't really get that just baking bread smell the way I want. Last book you read that really influenced your thinking. I actually belong to a book club and I read one, so I get one every month or so. And I'm trying to remember which one impacted me so much. Honestly, if I had to think about the book I read recently, it's almost embarrassing, The Great Gatsby, which I read for the second time recently. And it impacted me enough that I then went to see the play, which is a musical, which is now on Broadway. Hahaha Well, sounds great. I think it's never too early or too late to be influenced by a classical book. No, Yeah, certainly. I've just been thinking about Dostoevsky, like, again, people read from age of, I don't know, 14 to the age of 100, and every time they can find something new there. of more recent known demon copperhead, is about growing up in the American South. So if you could collaborate with any creative artist, and now I'm not quite sure if you wanna do that because you are a creative artist yourself, but if there was someone you wanted to collaborate with, who would that be? You know, it's interesting. I've always been interested in trying to, even though impressionistic fragrance is not what we do, I would love to collaborate with a musician on a fragrance. uh I happen to be a deadhead, so that would be wonderful. And I actually spoke to them once about a license, but we couldn't quite work it out financially. ah But I have always been fascinated by the intersection of music and fragrance, and I don't think anyone's done it well. I could understand your point, because I feel that there is a lot of play around it. Well, I think there's a tendency that we use musicians as in the sense of their celebrity. But I haven't seen anyone who's done a really interesting job of tying in the fragrance to the music itself. It's about the celebrity. It's about the lifestyle. It's not about the music. The right. I would love to do jazz fragments and I don't know where to start with it. It would be interesting to work with a jazz musician who might have a different point of view about that. that's the area. I've done a lot of collaboration because we do a lot of really interesting private label stuff. So we've done fragrances for Burger King. Right now we're doing, we did one recently for Anne Anne's. We've done work with with Play-Doh and Jelly Belly Hershey. So our collaborations have tended to be with brands that are associated with iconic scents rather than collaborate with people, which tends to bring you back into the more traditional uh impressionistic view of fragrance. And I haven't found a way to do impressionistic differently than people already doing it yet. You know, after, I hope that after this episode, at some point somebody, maybe just musician or somebody who is really keen into collaborating uh will reach you and maybe something will work out. I will just keep my fingers crossed for that. Yeah, you know, part of it is, you know, once people have an agent, you know, you have enough celebrity to have an agent, it's all about the royalties, not about the art. So it's a it's a it's a unique little area that I really haven't seen the kind of haven't had the kind of results I'd like to have. Yeah, but I wish it would be a true collaboration. would be nice if comes to patch, yes. Yeah, totally. So thank you, Mark. Thank you for coming and for your knowledge. you