A tin of caviar is baked beans for bankers, you’d imagine. And farmers producing one of the world’s most expensive foods must be raking in the cash, for sure.
But you’d be wrong.
Despite a 30g tin of caviar fetching between $150 and $200 – around $3000-$5000 a kilo – it’s not the sort of business most investment bankers would recommend putting money into, because of the high risk of failure and long ROI times of up to a decade.
But that didn’t stop Sterling Caviar’s managing director, Shaoching Bishop, from walking away from a successful career at Goldman Sachs to become something of a corporate turnaround expert in the caviar industry.
Sterling, in Sacramento, California, pioneered farmed caviar back in 1993 and when wild harvesting was banned globally in 2006, the company really came into its own, alongside the likes of Italy’s Calvisius and Yasa in the UAE. China has also pushed hard in to the sector over the past decade.
Sterling Caviar is America’s biggest producer and owned by the global logistics business Stolt Nielsen. You’ll find it in top Australian restaurants such as Quay, Rockpool, est., Sepia and Guillaume, but Australians have also developed a taste for caviar in their own homes thanks to the advocacy of provedore Simon Johnson, who’s seen consumption double over the past five years to more than 1.1 tonne annually – about 1% of total global production.
Chinese-born Bishop sent around 150kg of Sterling caviar to Australia over the past year and sees plenty more potential, especially because of our proximity to Asia.
“When I arrived here I saw all the ads in Chinese and knew it was going to be a market,” she told Business Insider.
“In places like Hong Kong and Singapore, middle-aged women get together and order tonnes of caviar. It’s only a matter of time until that happens here.”
Shaoching Bishop grew up near Shanghai before heading to the US to study as a literature major. She’d “never touched a business” but was good at maths, which led to a career in investment banking as an analyst at Goldman Sachs, starting in sales, then moving to the buy side, hunting out small ventures for investment.
“That’s where I learned to run a company and assess problems,” she recalls, learning a critical lesson along the way.
“There’s only one thing in business that sets people apart and whether they’re successful or not. That’s management, it doesn’t matter what the product, it’s all management.”
Then she stepped away from eight years as a banker in 2003 for parenting, confessing that “being a mother is more challenging than working 100 hours a week”.
Bishop couldn’t help herself though and took what she called a “part-time” job working 7-8 hours a day for San Francisco entrepreneur Maurice Kanbar, who’s best known as the creator of SKYY vodka.
She spent nearly a decade working for Kanbar while raising her family, but said she was getting bored, looking for a challenge and thinking about returning to banking. But Kanbar has a 30-year-old problem child called Tsar Nicoulai Caviar. The business had been losing money for 10 years straight and gone through seven managers in that time.
“Over the years investors came with $2, $4, $6 million – and all went bust,” Bishop recalls.
She became general manager and began to apply the lessons she’d learnt during her time at Goldman Sachs.
“It’s actually very simple. It’s just common sense,” Bishop says.
“I’m a very hands-on manager. My typical wardrobe is the same as the workers. I believe a manager is not just sitting in the office and reading reports.
“You really have to get your hands dirty and be with the workers. That’s where you gain trust, more importantly you gain all the insights of the business.”
Bishop is a manager who sweats the small stuff, as she reveals in an anecdote from her first day in the office.
She spotted a small machine in one corner and asked what it was. A stamp machine that cost the business $25 a month to rent. They sent about 50 letters monthly at 40 cents each.
Bishop had an ultimatum.
“If it’s still here tomorrow, you’re fired,” she told them.
The cousins and other relatives of senior people were the next to go.
“That was a little bit difficult, but I made sure people who remained got good money and a bonus,” she said.
The next issue was the pile of parking tickets drivers accumulated during deliveries.
“I randomly picked up a ticket. It was $60. I reached into my pocket and took out the cash and said ‘I will pay for this. This is not on the company, this is on me. Now the next ticket is yours’. I never saw another ticket,” she recounts with a grin.
Paying attention to all the details paid off.
“We were able to maintain cash flow, break even after 16 months and after 18 months started making a profit,” she said.
When the owner wanted to sell, Bishop offered to buy, but “he literally doubled the price, saying, ‘If you have the confidence to buy it, that means it has a lot of potential’.”
Bishop walked, with dreams of starting her own caviar company. She became a caviar distributor, selling to restaurants and getting to know the likes of America’s greatest chef, Thomas Keller of Per Se.
“I was never a sales person but discovered I really liked it. It’s just dealing with another human being on a highly psychological level,” she says.
Bishop says she “made quite a lot of money in five months, but I got bored again”.
At that point, Sterling was looking for a CEO and MD.
“I just thought it was meant to be,” she says.
To understand why caviar is such a risky venture, you only have to look at the maths. It takes at least 10 years for a sturgeon to reach maturity, ready for harvesting, and they don’t all mature at once, so if you miss a fish with eggs, it re-absorbs them and doesn’t spawn again for two years.
It can be up to 15 years before some fish are harvested and having fed the sturgeon to around 80kg in size, the 2-metre long fish produces between 2kg and 6kg of eggs.
Oh and one other small but very important detail – you need wait for three years before you’re able to sex the fish and separate the females from males (who will then be processed for meat).
That’s a lot of fish food in the meantime.
Sterling has around 700 tonnes of live fish in its ponds at any one point and produces around 12 tonnes of caviar annually.
And that’s why caviar is expensive. It’s also a business full of risk – you bet long, like 10-year bonds with no guaranteed rate of return.
Sterling offers caviar in three grades: the entry level classic, royal and top-of-the-line imperial, each with distinctive colour, egg size and flavour. They’re available at Simon Johnson stores in Sydney, Melbourne, Perth and Black Pearl in Brisbane. Call 1800 655 522.
The fascination that keeps Bishop “working on a fish farm”, as friends back in China are told, is the people who buy Sterling’s product. There’s a little bit of Goldman Sachs in everyone.
“Caviar is a lifestyle. You see the excitement in the consumers. When we buy milk and eggs we’re not excited because we have to do it,” Bishop says.
“Caviar is excitement. And it’s the attitude. I live for being inspired and inspiring other people.
“When you’re selling a lifestyle, you witness the success of the human race because most people who can afford caviar are pretty successful people, so it’s actually business, lifestyle and psychological related.”
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