How Kyle Sandilands plans to get richer: H2Coco coconut oil and 13KYLE loans
KYLE Sandilands wants to make more money from his business interests than his big mouth. Here’s how he plans to do it.
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IT was on a private Fijian island that Kyle Sandilands struck upon what has become the latest product for his biggest business venture to date.
The locals on Vatulele — owned by controversial former Sydney property developer Albert Bertini — were rubbing coconut oil on their skin. His model girlfriend Imogen Anthony followed their lead. She liked the feel and he liked how it looked on her. The oil was also being eaten and used in cooking.
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In May, H2Coco — 23 per cent owned by King Kyle Investments — launched organic virgin coconut oil, extolling benefits including its use as a moisturiser.
“That’s part of Kyle’s involvement,” says business partner and manager Andrew Hawkins.
Sandilands is said to earn as much as $4 million a year from radio.
He won’t say if that’s right. But he does say he wants his business interests to generate more than his mouth.
So, while neither he nor Hawkins will talk numbers, it seems reasonable to suggest the plan is to become the $8 million man. Minimum.Like Sandilands’ KIIS 1065 breakfast show, H2Coco is vying to be no.1.
The US is next. Coconut water is the fastest-growing beverage category in the world. H2Coco’s sales grew 360 per cent last financial year as staff numbers went from three to 12.
Part of the growth has come from being on the Boost Juice menu, a deal done via Sandilands’ connection to Boost chairman Jeff Allis, formerly the programming director at Austereo. It was Allis who in 1999 gave Sandilands his big break — hosting the Hot 30 Countdown on 2DayFM.
“I’m good at connecting people,” Sandilands, 43, says.
He and Hawkins, 30, are convinced the oil will match the water’s success. But others will handle the details. They don’t even know the retail price. They have shifted their attention to a new project — loans.
Like the coconut oil, Sandilands stumbled into the finance broking opportunity. He was sitting at one of his haunts, Sienna Marina at Sydney’s Woolloomooloo, with friend Roy Costigan who was tapping away on his laptop. Sandilands asked Costigan what he was working on then grabbed the laptop to see.
That was late 2012. In August this year 13KYLE emerged. King Kyle Investments has a 50 per cent stake (Sandilands and Hawkins each own half of King Kyle).
13KYLE’s strategy is to reach young consumers looking for their first loan — for, say, a car — then keep on lending to them for a business, a boat, an engagement ring or a home. The other half of the business is owned by the finance company of WA’s largest luxury car and boat dealer, Alf Barbagallo.
The goal is to be broking $2 million worth of loans each month within two years.
“It’s very left field, but I think it could be a very good idea,” said business coaching and marketing guru Siimon Reynolds.
“Why? Because no-one can tell the difference between any loan company. A guy like Kyle can come in and get a lot of attention for a small brand.”
That’s what Costigan wants: “Kyle is a lead generator.”
But Reynolds thinks Sandilands can deliver a bigger benefit. We’ll come back to that.
I have joined Costigan, Hawkins and Sandilands at another of the shock-jock’s haunts, D’Bees cafe in Double Bay.
Over two hours Sandilands has one Coke, one cigarette and half a chocolate bar — which he had brought with him.
Apart from repeatedly referring to Roy as “Ron”, he’s razor-sharp. While everyone else I speak to for this story calls Hawkins “Andy” — including Hawkins himself — Sandilands only ever refers to him as Andrew.
“They are the yin and yang of each other and that’s what makes them work,” says David Freeman, the major shareholder in H2Coco.
Hawkins and Sandilands met at the 2004 ARIA awards. Hawkins, then a 20-year-old record producer, gave Sandilands his business card.
A year later Sandilands needed a record producer and recalled liking Hawkins’ “energy”. They spent a fortnight in Hawkins’ studio.
Sandilands was also in need of a manager. By the end of the two weeks he wanted it to be Hawkins.
“I thought, ‘how do I get this guy? I woo him. I romance him, Bachelor-style — not this Bachelor, because he screwed her over in the end.”
So he took Hawkins to America where they spent a fortnight at rapper Snoop Dogg’s house. From there they went to hang out with Mariah Carey’s people. And they caught up with Jay-Z.
Hawkins sold his recording business and became Sandilands’ manager.
Hawkins is now based in Los Angeles, where he is building Young and Vicious, a music and media enterprise. It’s more music than media at the moment, although Hawkins says a TV pilot is in production.
Sandilands says he has been “securing” scripts and is involved in picking the recording artists and songwriters signed by Y&V.
So what’s next?
13KYLE could expand into insurance, he says. There could be a Kyle chewing gum.
They should be talking to Reynolds. While doesn’t know Sandilands but has a “soft spot” for him.
Reynolds’ wife was struck by a crippling migraine in the foyer of the Mondrian Hotel on Sunset Boulevard while in the company of a group including Sandilands, who at the time was doing his Australian radio show from a room in the hotel.
She did not know Sandilands, but he raced to his room and returned with medication.
Reynolds believes Kyle-branded products could succeed in boring categories. He nominates butter and salt. He says insurance and chewing gum could work.
He also believes Sandilands needs to capitalise on his “no bullshit”, say-it-like-it-is, image. 13KYLE can do more to take advantage of this: “Then he can just move to different things, like Virgin.”
If it can a lot of money Sandilands — who claims to be a recluse — wants in. He needs in.
“Even though I don’t do a lot I’m quite expensive to run,” he says. “And I’m a bit greedy.”
Kerry Packer: “I like the whole bulldog approach. His techniques might not apply in today’s world, but they do in my companies.”
Gina Rinehart: “She can be on the H2Coco board. But she’d have to ring up and ask. She might have to buy in.”
Lachlan Murdoch: “I like people who are young and smart who have made some mistakes but have made some great decisions.”
Peter Harvey: “I like Peter Harvey. Do you know him? He was the chairman of Austereo chairman a while back.”
John Singleton: “Singo’s always good. We talked to Singo the day before we did the deal (with ARN). He was drilling us. He said ‘good on you mate’.”
King Kyle Investments
Half-owned by Sandilands. The other half is owned by Andrew Hawkins. Established in 2012, it holds many of their other interests
H2Coco
Set up in 2010. King Kyle Investments owns 23 per cent. The main shareholder is David Freeman, son of George Freeman. It also has backers from NZ
13KYLE
Registered in May this year and half-owned by King Kyle Investments. The other half is owned by a finance business connected to WA luxury car and boat dealer Alf Barbagallo
Young and Vicious
Two-thirds owned by Hawkins and set up in 2009. He says Sandilands is involved, but company records do not show any link to King Kyle
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