Broker, Trader, Lawyer, Spy - Eamon Javers [76]
Dyer headed back to his office.
Somehow Beckett Brown was able to get materials from inside the Whetstone facility. And just as it had in the Mars case, Beckett Brown generated a torrent of information about this company.
Beckett Brown obtained a document showing that Whetstone took delivery of a high-speed machine from Germany that made hollow candy. “Although the equipment was shipped by Aasted-Mikroverk (Denmark), the invoice indicates the customer is M&M Mars, Waco TX,” noted a Beckett Brown briefing paper.
The spies also obtained a copy of a customs document showing British Airways shipping plastic candy molds to Whetstone’s plant.
And most important, Beckett Brown was able to prove that Whetstone had hired Stephen Cogswell—a marketing whiz who had worked at Nestlé on the Magic project.
Taken together, this suggested that Whetstone was gearing up to introduce its own version of Nestlé’s ill-fated Magic. If it could steer the new candy through the regulatory challenges in Washington, Whetstone would be in a position to steal market share from both Nestlé and Mars. Clearly, that would be unacceptable to Nestlé. Magic had been Nestlé’s idea, after all. The thought of Whetstone cashing in on the millions of dollars Nestlé had missed out on must have been unbearable.
So Nestlé, ironically, began the same type of coordinated media, consumer, and regulatory attack against Whetstone that Mars had run against Nestlé just two years earlier. And now Nestlé would do some rent-seeking of its own, pushing the government to shut down the rival product. The old game of spy versus spy had now become spy versus spy versus spy. At that moment, private detectives, veteran Secret Service officers, high-powered PR executives, well-connected lobbyists, and international corporate titans were engaged in an international secret war over the fate of a two-inch chocolate ball. It would be hilarious if it weren’t true.
“Two consumer groups ran to the FDA and the Consumer Product Safety Commission and attacked my product,” Whetstone remembers. “I knew what was going on, because Mars had done it to Nestlé. There was no question about it.” Whetstone became convinced that the spies were using Willy Wonka’s tactics on him. He fought back, and was able to bring his product—a chocolate-covered plastic egg he called Megga Surprize—to market. It was now legal because Whetstone’s hard work had paid off. He’d figured out how to create a toy-inside-chocolate combination that could pass government review. The safety commission concluded that even though the chocolates encased a rigid plastic egg that contained a paper toy, they weren’t hazardous.
And then something unusual happened: Megga Surprize failed. Not because of a stealth political campaign or an elaborate spying operation, but for a much more mundane reason—the customers didn’t like it. Whetstone says that in shaping his product like an egg, he made a fundamental miscalculation. Retailers didn’t want to buy egg-shaped chocolates unless it was Easter time. And when Easter rolled around, Megga Surprize was up against hundreds of other egg-shaped candies. Whetstone’s product didn’t stand out enough, orders were slow, and he gave up on Megga Surprize.
Disheartened by the flop, and by now having lost his lucrative manufacturing contracts with Mars and Nestlé in the collateral damage of the chocolate war, Whetstone decided to get out of the candy business altogether. He entered an industry he thought might be somewhat less cutthroat: commercial real estate.
“Life,” Whetstone says, “is too short.”
CORPORATE LIFE WAS short for Beckett Brown, too. By late 1999, it began to splinter as rivalries among the founders developed into an all-out battle for control of the firm, which now had twenty-five employees. The key executives began fighting over cash flow, expenses, and allegations of unsavory