Matt Phillips is the Founder and CEO of Military Java Group (https://www.militaryjavagroup.com), a coffee company focused on the military and donating 50% of its profits to the Semper Fi Fund. Matt has over 35 years experience in the industry, spending time as a trader in New York, working in Brazil, and much more.
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Aaron Spatz 00:00
You’re watching America’s Entrepreneur on Youtube. Welcome to the show. I’m your host, Aaron Spatz. And each week we interview entrepreneurs, industry experts, and other high achievers as a detail their personal and professional journeys. Before we jump in, hit the subscribe button and be sure to hit the bell icon so you’re notified every time we release a new episode. Good day, Welcome to America’s entrepreneur, I’m so excited that you’re here. We’re going to dive right into today’s show. So I’m just really appreciative that you are taking the time to listen and watch so I’m really excited to welcome Matt Phillips to the show. Matt Phillips is the President CEO of military Java group. And so they operate three different brands of coffee, Java, Java, bravo, Zulu, Java and Stars and Stripes, Java. So Matt, Matt has worked in the in the coffee business for quite some time. I’m going to actually stop sharing the details there. I’m gonna let him do all the explaining. And so just matters want to welcome into the show, man, thank you so much for being here with me.
Matt Phillips 00:58
Well, thanks for having me. Aaron, I very much appreciate you reaching out to me and inviting me on and allowing me an opportunity to promote our coffee and, and our mission of donating 50% of our profits to support the Semper Fi and America’s fund. And, and these, these great young men and women who have served in sacrifice, and now Anita, some of them a lifetime of assistance. So people like you who go out of their way to help us. In effect. The bottom line is you’re helping these these young men and women who deserve our assistance and support.
Aaron Spatz 01:31
That’s great. Well, it’s it’s my sincere pleasure. And so I’m just looking forward to looking forward to getting to know you and your story in the background and everything else. So right off the top, I mean, you said you have 50% of your profits that is a that is a that is a massive amount of donation that you’re that you’re providing these different funds. So what So why don’t you Why don’t we just roll back the clock and share with me just a little bit about your story and what in what has gotten you to where you where you are today.
Matt Phillips 01:59
Well, it’s um, my dad was a World War Two Marine, and he spent 20 plus months in the Pacific and a lot of that time in the backseat of an SBD Dauntless dive bomber. So he was the youngest of 16. They were 14 boys and two girls. I always say the two girls must have felt like indentured servants. But three served in the First World War. And one was actually a Silver Star recipient with the US Army 77th division for action in the US are gone offensive in France in 1918. He left that to me with the with the original citation. And it’s something I treasure. Yeah, you know, it’s special for me because uncle purse was he came back. He was an inspector on the Nassau County police. He spent 40 years on the police department. And he was kind of a gruff guy. But with all the nieces and nephews that he had, he chose me to leave that to and it was very special to him. So it’s very special to me. solid silver, by the way from Tiffany’s in New York,
Aaron Spatz 03:06
Matt Phillips 03:08
And they also had a letter in there saying if he wanted his name engraved on the back, it would cost two and a half cents a letter. I always get a kick out of that, like the guy earned the Silver Star and they could charge him two and a half cents. A letter name. Yeah, exactly. Yeah. But then five served in the Second World War. My dad, you know, 20 months in the Pacific. One, actually, my uncle think that was his nickname. Winford was his name. He served in both World Wars. He was on a navy old tour stacker destroyer and World War One doing Atlanta convoy duty escort. And then when the second when Pearl Harbor took place, he went down and he was in the construction business. And he was in his late 30s, early 40s. And he he joined the Navy Seabees he was taken on as a CB he participated in four campaigns in the Pacific the last he landed under fire in Okinawa, and who did he run into but his son who was also a navy CV bouncing around the Pacific for two and a half years but never had been on the same island together. So we come from a family that that no surface. Unfortunately, when I was three years old, I was struck in my right eye with an arrow, my brother you know, an accident, I think. But um, when I was seven, they had to remove it. So I never had the opportunity to serve in uniform. So I ended up in the coffee business. Actually, it was through I played ice hockey. In college, I was starting goaltender on my my college team and as I told people, I was the best one I goaltender in North America. One of my teammates was his dad was in the coffee green coffee, physical coffee trading business, Wall Street, and I started he spoke to his dad who was also a world war two marine and I started as a runner on Wall Street, literally as a runner. And eventually, I started working with a Brazilian firm who was opening an office. And that’s how I got into the green coffee trading business for 10 years, I was the trading manager for them. I lived in Brazil for several years. Then when I came home, another Brazilian company asked me to open their global headquarters for commodities trading, and they wanted to hit in New York area, and I lived on Long Island. And so they said, Fine, you could put it on Long Island, which was convenient for me, and that I didn’t have to commute into Manhattan anymore. And it happened to be right down the block from First Marine Corps, recruiting headquarters, First Medical District recruiting headquarters in Garden City on Long Island. And I ran into a bunch of the Marines and befriended them. And I made some really great friends who to this day where, where this was back in 2000. We’re all still friends and stay in touch. And I did all I could to support them and their families. And but when I retired in 2005, I went to them and I said, Look, I never had an opportunity to serve. And I’d like to do something more hands on here. So can you get me a deployment to Iraq? And in 2008, they came through for me and I deployed to Iraq as as part of the if LOGCAP logistical support mission? Yeah, no, it was, interestingly enough, originally, what I my position was going to be was going to be senior procurement, because from my background in commodities, and trading, and so forth, and I kept calling my monitor. And, you know, finally, every week I called her and finally, she said, you know, Matt, with the uplifts, you’re going to bank over $200,000. And you’ll stay for a year, so it’ll be tax free. And you’ll be in the green zone and working in a cubicle and have your own hotel room with your own head bathroom. And all these restaurants, there’s bars there, she said, these people, there’s only a few of these positions, they don’t give them up. She said it might be a year before you can get over. And I said, Well, what do you have that can get me over now. And she said the only thing we have is the male mission. And she said, But you wouldn’t be making more than 80 grand. Like I was going there for the money. But she said also, she said you’ll be humping foot lockers 12 hours a day, seven days a week, she said, you’ll be living in a dry cam. She said, You don’t know where you’ll be, you’ll be using a community head. And she said, so that’s the only thing we have. And that’s exactly what I’m looking for. So that’s what I went over when I was at Camp Liberty for a while. And I volunteered before deploy was sent out to fob warrior and Kukoc in the Kurdish region. And I loved it, because I worked the front counter. And I got to meet and interact with these young kids every day, and I had a blast. I did whatever I could for them. I mean, I was the unofficial bank, a lot of them it was cash or Eagle cash. And a lot of them would come up and they find out their Eagle cash account is tapped out. And they’re short, a couple bucks, three or four bucks, you know, whatever. And here, they are looking to send something home to their wives or their kids or their mom and dad or their girlfriends. And, you know, I couldn’t turn them away from the window, you know, the other guys that were there. And God bless him. They were there for different reasons. But, you know, for me, it was the experience and the supporting. It wasn’t I wasn’t there looking to make money. Actually, I was losing money because I was a consultant for the Brazilian firm. So, you know, but regardless, you know, I would, I would spot them the money and I’d always say, hey, you know, you owe me this because it’s a matter of principle. It’s and, you know, I didn’t want it to look like charity for them either. And have them feel that, you know, it was something that so anyway, I was there and, and enjoyed it and didn’t enjoy the place. I mean, anybody who says who’s been to, you know, a fob interact, says, Yeah, I loved it. There is, you know, I don’t know why they but, but you know what I was doing, I felt for the first time in my life, I finally had an opportunity to do something hands on and support, you know, the troops in the field on the frontline. So it was the greatest experience of my life.
Aaron Spatz 09:33
Wow, man. I mean, that that’s I mean that that’s quite the experience that quite the the opportunity to be really, really involved. Right. And so it’s like you’re sure you didn’t like serve on paper, but man, like you’d absolutely did serve, right. That’s the thing. It’s like you you absolutely did, you’re contributing, you’re contributing to the war effort over there and, and you’re making a real difference and a real impact even in In whatever role or capacity you happen to be in so I think that’s, I think that’s, I think that’s terrific and something like I can, like, I know you’re super proud of it man, like, you should definitely be proud of that time because that’s, that’s a rare opportunity that people get to, to be able to contribute in that way. It’s, it’s very rare. So,
Matt Phillips 10:19
but it was, I also I had a second and and this actually led into the the coffee business, the coconut company. I was very good friends with. He’s retired now. He retired last years. Commanding General one mouth, Lieutenant General. Jody Osterman, and Jody, I met way back in the day. I don’t I was before MC Ricky was a colonel. He was at the amphibious warfare school. Okay. And we became friends. And when I went, I had several friends. And as it turned out, I was chosen to be I interviewed for and I was chosen to be the team lead for, I don’t know, if you recall the task force for business instability operations out of the office of the secretary. It was interesting. It was out of OSD. And what happened was USAID was the major player in terms of civil affairs and working in country. But most of the USAID people were, you know, not trying to denigrate anybody service or what they did, but they were mostly younger people. And they were working at the State Department, and they were looking to punch their ticket to move up in state. What military commanders came home and said, you know, look, we don’t have people there who can interact on a business level. And on a technical level within the business framework, for example, over there, you had the ports, they needed to be reconstructed, you had the whole petrochemical industry from top to bottom that had been destroyed. And so I think it was Secretary Gates said, Look, we’re going to stand up a unit, an operation, and we call it the task force for business and stability operations, the work out of OSD. And what we’re going to do is we’re going to hire older professionals, who they like to say, Where where the rubber meets the road. So they hired older guys who had been in the petrochemical industry, who had been in industries that needed and required expertise, special expertise, that would be willing to volunteer to go over there and work with the Iraqis and get things started again. And it worked great in Iraq, because there was so many different aspects that the task force could lend itself to with with the expertise. Afghanistan. I mean, you know, when I sat and talked to the guys, you know, there was one road, there was one, there was no industry, there were tribes within tribes. There was no port. So the task force really kind of withered on the vine there, because they really had no function. But what they wanted to do was get involved with the opium eradication program. So they had a group of, there were two young college kids who had just graduated college who were agronomist, and one and then a couple of farmers. And they were part of the group, but they were looking for somebody to lead it up. And I went to them and said, When I interviewed, I said, you know, my expertise is in general. I said, you know, okay, I lived on farms in Brazil. But I’m not an agronomist. I’m not a farmer, but I know enough about it. But what you need is somebody who knows the logistics part of the equation warehousing, the whole general overview that can say to the farmers, okay, look, this is what we need to do. We can’t have everybody might, I was going to set up co ops, where because you didn’t want it was all small farming, you know, each farmer only had a small that area gland that he was going to cultivate. And like I said, we don’t want everybody cultivating ground nuts so that when they go to the market, the markets over flooded with ground nuts, and their profit margins are going to be nothing. So we set it up so that this group does this commodity or agricultural commodity, this grows this. And that was my idea. And they liked it. And they said, Okay, your team lead, you’re going over to Helmand Province camp Leatherneck. I was ecstatic, you know, and Jodie Osterman happened to be the commanding general of one more move forward at the time. So I emailed him and I told him, I’m coming over and he was like, Wow, that’s great. Okay, fine. And we corresponded. And he sent me an email and I was due to go in about four weeks, three or four weeks and I had my shot card updated. I had my physical I was all good to go. God sent me an email saying that all your paperwork just cleared military civilian affairs, civil affairs, you’re good to go, I’ll see in about three weeks, I’ll buy you dinner at the chow hall. And then two weeks before we would do to go, boom, they pulled the funding. You know, it was one of these political infighting where Hillary Clinton who was the Secretary of State, and she wanted the monies for US aid, which was her family with her people. And I, you know, she went out on the fight. So we fast forward to a year or so later, and Jody is back. And he’s taking over MARSOC. At stone Bay down at Camp Lee Joon and I go down and for the, for his, for the change of command, were resumes, and afterwards, went back to the house and I got them aside, and I said, you know, I really would love to get over to Afghanistan can can you do anything for me? And he, he looked in in a very nice way, because God is just the nicest guy in the world. We said, man, you’re basically too fat and the tool. He said, listen, he said, Why don’t you do something? He said, you have all this background and experience and connections in the coffee industry. He said, Isn’t there something maybe that’s something you can look into to to do that can help out? And that was the genesis of this? I said, Yeah, you know, it’s true, I do have all these connections and background. And that’s, that’s when we started up. And a good friend of mine was was a friend of Karen Gonzalez, husband, who was a Marine colonel as well. And so I got the introduction, Karen. And it’s my understanding, we were the first commercial entity to be allowed to use their their logos, which, you know, is a real honor. And, you know, I look at it as something that, you know, I if you follow me on LinkedIn, I think you do you know, that we do our daily history posts, I do. But you know, nothing political nothing that can bring any kind of embarrassment or whatever to to the Semper Fi fund, because, you know, I feel a real connection with them and an obligation and responsibility to restart and what they’re doing and not do anything that would, would embarrass them or embarrass me.
Aaron Spatz 17:22
Yeah, no, well, I mean, it’s like, that’s an incredible story, just like just understanding. It’s like the journey and the process. And so it’s like, I’d like to now just kind of start to pick up certain parts and elements of the story and go a little bit deeper into certain thing. So let’s, so let’s let’s go back to when you’re doing commodities trading with coffee, so and then you said you spent some time down in Brazil. So explain to folks like how, how this how the whole commodities trading aspect of things, works, or worked, when, like when you’re when you’re running on the floor there, and then you’re developing relationships with these, with these different places in South America, like, walk us through that a little bit? Well,
Matt Phillips 18:07
people don’t realize, but coffee is the second largest cash value commodity traded in the world after oil. There are I believe it’s 45 Different producing countries around the world. Obviously, the producing countries are around the equator, because coffee lends itself the coffee tree growth lends itself to that. That kind of climate. The Green Coffee fiscal part of the equation is it’s twofold. You have the physical commodity that you’re purchasing at origin, regardless of what origin it might be. It gets complicated because you’re buying sometimes in the local currency, and it all has to be brought back to dollars and then it has to be hedged in dollars. And then you have the futures markets. In London, which handles robusta coffee, that’s a specific strain of coffee. It’s a lower quality than then then washed Arabica coffee or natural Arabica coffees. All these are, are ways that the coffee is is processed, it’s dry, processed or wet, processed. There’s an arbitrage that’s usually about 45 cents between the London market, the London futures Robusto market and the New York well now it’s it’s the it’s electronically traded on the ice the Internet into the actual continental exchange. But what you’re doing is you’re working and you’re working. I don’t want to get too complicated differentials, various coffees grades, and then their relative value versus the futures market, which then you’re selling to two roasters, or other trade houses, but it’s developed now where the markets have consolidated where it’s just a number of real large multinational trade houses. that dominate the market on the green coffee side. And then on the buy side. It used to be there were a lot of regional roasters, and you had the big ones. You had Folgers, you had Maxwell House, which was General Foods or they changed names. But you had a small regional ones like Martin’s intently, you had Coca Cola, Coca Cola, roasted coffee had two brands. But they all consolidated. And now it’s the big guys. It’s Nestle. Starbucks, I remember when they started up, they were nothing. I mean, they were tiny. So you have this, these these groups. We’re fortunate in that when we when I said connections. They’re the largest green coffee trading company in the world is a company by the name of the gnomon coffee group, and they’re located in Hamburg. They do 2.6 billion a year. And they’re privately owned. David Goldman, I knew when he lived in New York, he we go back a long time. But the CEO of Ross his corporation was, which is the North American entity of the Norman Group. They do 20% Of all the color green coffee that comes into the United States. They’re the number one importer of coffee from Colombia, from Vietnam, and Vietnam is the second largest coffee producer in the world now. They’re still produces about 60 million bags of 60 kilos eek. And then Vietnam, just close to 40 million bags or robust at most 95% robust. And then Colombia’s third 13 million. So you see where Vietnam it’s incredible when you look at the growth there, and most of it in the central highlands. But the so Rothfuss Corp is the biggest in the United States. The CEO is a fellow by the name of Dan Dwyer. Dan, I met playing ice hockey 43 years ago, I met his wife before I met Dan. I’m the godfather for one of his daughters, twin daughters. The I got him his first job in coffee. In fact, when I got my job, and left as a runner, Dan took over my spot as a runner for the Green Coffee Association. Dan and I are our brothers. He came to visit me here. I’m in Hendersonville, North Carolina, in the mountains, western North Carolina. And he loved it so much. He bought a house 20 minutes away, where he’s going to retire to in a couple of years. So Dan and I are as close as can be. And Dan is a real patriot. And I went to him and said, Can you help me out here? And he said, Matt, I’ll do everything I can for you. At one point, I owed him close to $400,000. And he was like, I’m not worried about it. We’ll we’ll make it back. You’ve had a hiccup with COVID. You know, we went back into the red for a you know, we’re treading water here. But we have a lot of things on the fire. It’s things we’ll put an I’ll get into them later. But with the green coffee trading. I lived in Brazil for two years and worked there because they wanted me to learn the business from from, like, they say from from the tree to the port to the final buyer. So for 10 years, I I ran the trading company, they are in New York, and they were the largest exporter of coffee out of Brazil, which made them the largest exporter of coffee in the world at the time. Then I went to branco Paris, and they’re a smaller company, smaller in that we used to do about $750 million a year out of Franco Paris. But they had various commodities as well. They had sugar raw and processed sugar refined. And they also did frozen concentrated orange juice. So and they’re like family, I was the guardian for their children when they went to school here. When I go down there, you know I would, I would stay I wouldn’t stay in hotel hotel, I’d stay at their homes. They I was just on with them the other day, because Mother’s Day in Brazil. So I had a call all my Brazilian family down there because the boys who were going to college here when I was the Guardian, they’re all you know, they’re married and have kids now as well. So, but it was, I was very, the good Lord was very good to me. I was very fortunate because I worked for great people. I loved what I was doing. And now I love what I’m doing with this, although I work more now than I did. Yeah, well paid.
Aaron Spatz 24:35
Well, we’ll share a little bit about that. So Share, share, share with us a little bit about like the like, what’s the like, what are you doing right now with with the coffee business, like in terms of distribution, any, you know, what are your big challenges like what what are the things that you’re working on right now?
Matt Phillips 24:52
Well, initially when we started up, we only had the jarhead Java brand. And what I did was I went out and I went too, I contacted and, you know, I, I had helped through Dan, because, you know, he them being the biggest, they’re part of the supply chain as well as the trading chain. So I had meetings with Food Lion Harris Teeter, ingles. Big wine, big wine up in Connecticut. They had 80 stores, and they the guy there was great. He said, Man, I’ll give you a try. And we went in and we did okay. You know, we didn’t do great, but it was, you know, you walk in a coffee. Oh, you know what I’m talking about, you see how many brands in there. And Joy had Java. You know, a lot of people don’t know who what a jarhead is. So then he was transferred and the new, the girl that took over, you know, she really didn’t have the same patriotic zeal that he did to look to try to make it work for us. So I went to the Food Lion guy, and he was great. Because he said to me, man, I love it. I love the quality. Because when we started this up, I said to Dan, we’re only going to do the best quality. And Dan and I know quality. I mean, that’s what we did our whole life, we were on all the cutting panels and approval panels and everything. And I said we can put we can we can look at a price point. And we can put not so great coffee in there. But if you’re a coffee drinker and a coffee lover, you might try it for the altruistic part of the equation for the gift back. But if you don’t like the coffee, you’re never going to come back again, you’re going to say I’ll write a check to the Semper Fi fund before I buy that crap. So we put in the 100% Colombian coffee into the jarhead job. And it’s the exact same coffee that you would get in a bag of Starbucks or a bag of Dunkin Donuts, because the Colombian government, because coffee is such a legal hard currency or not for the country. I stress legal. They, they monitor they have a government agency that oversees the exports and they only allow two different qualities. So we’re getting the exact same quality that that the others are, then we do a bold roast, which is a little bit darker than medium, not much because we don’t want to burn it. We don’t want to get that that bitter
Aaron Spatz 27:12
punch segment. So just just so people will can follow this. So when so when you’re saying when you’re taking coffee out of the country, Colombia you’re taking you’re taking green unroasted coffee, is that right? And then and then the the magic happens when all these different companies such as Starbucks and Dunkin Donuts, all these other companies, then take those those green coffee beans and then roast them into their own proprietary in house ROAs.
Matt Phillips 27:39
Right? They do that with like 100% Colombian is one of the few that’s 100% or you have 100% kona coffee from Hawaii. That’s always they don’t mix. But most of the coffees that you get on the shelf are a blend of various origins. Yeah, so you might get Okay, let me take Maxwell House for example. Okay, back in the day, they used to use probably 80% Arabica coffees, and they would buy those coffees from say, mostly Central America, Honduras, Nicaragua, Guatemala, Costa Rica, and then you would have various grades within the country, you would have low grown, low grown coffees don’t have the same flavor as say a high grown because the climate at the higher altitude is different. And also the soil content is more volcanic. In the soil. It’s almost like with wine, the different flavor profiles of wine are going to be determined by the climate and by the soil. And that’s the exact same thing in coffee. But when you process the coffee, you have a wet processing, which is what most of the good coffees Well, all of the good coffees and Central American coffees for example. And what they do is they pick it and you have the mucilage the cherry around the two beans that are married in the center of the coffee beans. They will put them in vats of water, and they’ll let them soak so that the mucilage gets soft. And then they wash them down these troughs which washes the mucilage off and then they polish the beans. So you get a different flavor profile and it’s more expensive. Obviously, you got to change the water you can’t let the water get fermented because then that’ll ruin the coffee. Then you have the dry processes. Most of Brazilian coffee is dry process. Most all of Robusta coffees a dry process and by that they when they pick it, the beans, they take the cherries and they put them out on these huge patios, cement or hard clay patios. Because in the summer in Brazil, which is the opposite of here it is there’s no rain, very little rain, so they don’t get wet. So they bake in the sun. And then they put the cherries through these machines that crack the dried mucilage off and then they polish it. So it’s a cheaper way of doing it and you get a cheaper flavor profile. So the every roaster goes out, and they have a price point and a quality point. What’s happened nowadays with some of like the blue cans and the red cans of the various, they’ve gone from where they were 80% Arabica, maybe 40% of that Arabica being wet, processed, and 40% being Brazil dry process, because Brazil is more of a neutral flavor, and then 20% Robusta. So you get that arbitrage and 45 cents there. That’s a big difference. Nowadays, it’s probably 80 to 90% robust in those cans, and maybe 10%, Brazil. Now, again, you go to other coffees, and you get to different ranges, like Dunkin Donuts and all they each have their own flavor profile. With us, we have 100% Colombian and our jarhead Java. In our other two brands, we have 80%, high grown, washed, Arabica from Costa Rica, Nicaragua, Guatemala, then the other 20%. And again, Danny’s company has buying offices in each of these countries. So when we’re buying it, I’m going to Danny, he’s calling his people right there at origin. And because they’re the biggest the farmers giving him the best coffee because they the biggest, you don’t give the biggest guy the lousiest. And so we’re buying directly from the farmer, the other 20% in those blends, is what’s called Find cupping coffee out of Brazil. And that’s a contractual term. Find cupping. So it has to be within that flavor profile and visual profile of defects. And we sourced those from only two different regions, they’re from Alta Paulista or the Serato. And those are the two finest growing regions in Brazil. Like I say, I know I live there and spend time there. So we have our coffees are fantastic quality wise. So but to get back to with Food Lion, the buyer there, he said, Matt, I’ll let you go into any of the supermarkets around the basis, I’ll let you cherry pick. But he said, I have to tell you, if you don’t succeed, you get one shot at this. And if you don’t succeed, you’re out and you never get back in. He said what you really need to do is have the wherewithal to advertise to get the name out there. And then he said, you’ll only have jarhead, Java, which will probably work around marine basis, but not necessarily around, you know, other service bases. So I took a step back and I said, Look, I’m going to change the whole business model here. I said, where is it that everybody knows who the Semper Fi fund is? And I don’t have to advertise. And I don’t have to advertise jarhead drama, what’s in your head. I said, let’s focus on the military exchanges in the commissary. And everybody said, Matt, forget it, it’s impossible, you’ll never get in there. And to a certain extent, it was one hell of a fight. We fortunate we had a former commandant, two former Commandant who helped me out in terms of getting us in the Marine Corps exchange, and we got in there first. The unfortunate thing is there’s a lot of resistance within these places, because they don’t like change. And so it’s a struggle. But we got into the Marine Corps exchange, and we were doing four or five cases a week, we had a trial run that we had to sell 60% in 60 days. And then we would be able to get in permanently and be put into more stores. This was when five stores. We sold 70% in 30 days and 100% by the time that the 60 days was over. So now we’re doing fantastically there. I mean, where we were doing cases, we’re doing pallet loads. And now remember, in the exchanges, only 8% of grocery sales of the exchanges. Nobody goes to the exchange to do their grocery shopping, you know, they, they pick up beer and chips or whatever. But it’s, you know, the clothes and the housewares and sporting 92% is at the commissaries. That’s what the grocery stores are for. So that’s, that’s really where we want to get in. We’ve been we’ve been talking to all of them. Finally, last year, I got approved by all of them. I had to go like when I went to the Navy exchange, they said Georgia Java, and I said I’ll tell you what, I’ll stand up a brand for you. And that’s where Bravo Zulu Java came in. Because I said it works with the Coast Guard, the Navy and the Marines. So you know, there’s three right there with one brand and we put the BZ flags on it which looked pretty cool and I you know, of course some prejudice I think the packaging looks real great. So they like that. And so we we had a trial run set up with that. And then the Army and Air Force exchange, they wanted their own brand. And I said, you know, there was Air Force personnel in Cracow as well because it was Cooke regional air base crib. So I got an opportunity to see and there is a real, you know, difference between the airforce mentality and the army mentality. And kinsman was up there at the time. Not, again, not denigrating anything, it’s just a different way that they approach how to do things. And there’s not a whole lot of synergy there that I can come up with a brand like Bravo, Zulu Java that fit with those three services. So I said, Let’s do something that’s patriotic, so that we can also add a point bring it to the civilian market. So that’s where stars and stripes Java came in. But I said we’re going to package it military style, because we wanted to go into a feature and we want it to go into DECA the comments aren’t because we figured that would be the coffee that we didn’t lead in with. And I said, so let’s put the reverse muted American flag on there, because it’s an Army Regulation. But you know, the proper flag etiquette. The Starfield always needs to be facing forward. So if there’s a flag on your right side, or on an aircraft, like Air Force One or any aircraft, but there’s a flag on the right side of the fuselage, that has to be reversed. I said, we’ll mute it. So it will be not the bright red, white and blue, but it will be what you’d get when you deploy. Sure. And so I bring it to a fees. And the guy comes back and he goes, Man, you know, we love the coffee. But your flags back. He said, You got to turn that around. And I said, No. And I explained this an official Army Regulation and proper flag etiquette, and so forth. He said, Well, I don’t know, I’m going to go to my boss with this. And he comes back and he says, my boss says it’s backwards. So I had to go and make paste and cut and do a whole thing, the Army Regulation and sent it to them. And he came back and he said, well, people, you know, looking at it, and they grabbed the bag, and everybody’s looking at it and saying it’s backwards. I said, well, first of all, it’s not. It’s it’s the correct way to do it. Because we put on the side panel, our flag is always advancing. So, you know, we’re kind of lending to the fact that, you know, we’re doing the proper flag etiquette, even though it looks wrong. But I said, Isn’t this marketing one on one, you’re telling me everybody’s looking at it? It’s grabbing their eye, and they’re grabbing the bag and saying, What’s this the flags back with? I said, Isn’t that the whole object of the exercise when it’s on a shelf? So they came back? And they said, Yeah, okay, you know, we get it now and fine. And we were all set up for all three. And then COVID hit. And so, you know, they took a step back. And they said, you know, and then all of our venues, we were in a lot of different museums, like the Marine Corps Museum, you know, we so you can imagine jarhead job in the Marine Corps Museum. But we were in other military museums. And then we were also the coffee served that at the Naval Academy. We went down, we had to do a trial run there, what they do, interestingly enough, the food service director, he’s he’s pretty smart guy, every couple times a year, he has all different people in like, he’ll say, Okay, we’re gonna have a tasting. And if you have tacos, you have ice cream, or whatever. We had the coffee, and you go in, and he has about 120 of the brigade come in, and they sit and they have, they have to great each and every product. And I felt sorry for the other coffee company because they get their little spiel on their coffee. And then it gets to me and I’m like, Okay, we’ve got Bravo, Zulu, Java and droichead. Java, and we’re given 50%, back to the simplified one. And there were 120. There, we got 120 votes, holy cow. Well, you know, if, if you voted against us, you really don’t want to actually be at the Naval Academy. Right. So we were in there for a couple years. And two things happened COVID hit and then they had price reductions in terms of budget for the food service. And so they went to liquid coffee. And they offered me the captain was great. He said, Man, I hate to do this to you. But you know, it’s a it’s a money thing. And he said, we have to go with the liquid coffee. He said, I know it’s garbage. He said, I used to go by King Hall every morning and with My Gold Cup, and get your jarhead job before I went to the office. He said I wouldn’t be doing that anymore with for liquid coffee. He said, But if you want, I’ll allow you the contract. And I said, you know, I don’t want to associate our brands. I said, with all due respect and meaning that, you know, I don’t want you know, 5000 at the Naval Academy saying boy, that your head Java is garbage. You know, so I said I’ll pass on that. So that was you know, that was a hit for us. But we were partnered with Navy football for two years. yours we were the official partner for Navy football. And then again last year, we couldn’t do that because of COVID. But we’re we’re starting to see see things open up where we were Norwich University. They took us on. I haven’t even tried with the civilian market at this point. We’re online, we’re selling very well online. Because here again, COVID has changed the landscape for the coffee industry in that people are not drinking less coffee. Yeah, where they drink it at home. Right, how they buy it online, has changed dramatically. So we’re on we’re on Amazon, military Java group on Amazon, we’re at military, Java group.com or jarhead, java.com. You know, if you google search us, so that’s where we’re at now. But the main focus is, in fact, we just, we just bought our got to prove the wood with deca, what they were talking about in the others is for the initial trial run, they want a shipping display ship or you know, the cardboard stand up that you fill in. And actually that works best for us. Because it’s right there in the aisle. It’s not on the shelf, and you’re lost in the sauce. So we’d have we had that approved. And we’re hoping now that they’re going to say, okay, yeah, we’re gonna start taking in new products again, and the way that they work is I’m hoping that we get in for Thanksgiving, Christmas holiday be great. Yeah. And then if we sell well, and I think the business model has been proven it at MC X with the fact that, you know, our trial run there one so fantastic. And with, you know, again, if you’re going in there, and you’re buying coffee, and you see stars and stripes, Java, and you know, with that military style packaging, and then you see the given 50% of the Semper Fi fund, who like I say anybody in the military knows who the Semper Fi fund and how great they are. And the 50% goes to all the service branches. It’s not just the Marines, because the Americans fund is they give to all Now initially, they only did the Marines, but that changed back in 2004. I think it was. So, you know, as I say to people, I’m trying to get we’re getting some defense contractors. I say, if you’re, I look and I say if I’m Northrop Grumman, I’m buying coffee for my employees, and for my cafeteria. Is your current supplier donating 50% of their profits to support the very kids that are getting banged up on equipment, you might be supplying it to no fault of your own? I’m not saying that. Right, liable for that. I’m just saying that, wouldn’t you think that they would want to say, Yeah, let’s, you know, let’s, let’s take this because it’s a win win. It reflects well on us for supporting the Semper Fi fund. And also, it resonates well with, with the military, that you’re doing this.
Aaron Spatz 43:00
That’s fantastic. And
Matt Phillips 43:02
I’ll also I tell everybody that I’m not rich by any stretch of the imagination. I’m 67 years old, I’m in the mountains of western North Carolina, my nearest neighbors a half mile away, I love it, it’s me, I have no children, I have no wife, I have two small dogs, my fufu dogs. There’s nothing I love better than sitting out on my deck with a good book and a decent glass of wine. And I’m not looking, the good Lord has been kind to me, I don’t need anything more. So I’m not looking to keep My 50% My 50% is going to go back into the business and or be donated to such, I’ve seen so many small funds that are out there that do bake sales and golf outings and all kinds of stuff. And they don’t have the breadth and reach of having a former Chairman of the Board of excuse me, former chairman of the Joint Chiefs of Staff and coming down in the Marine Corps, General Dunford, who is now the chairman of the board or the Semper Fi fund. And you also have general Conway, who you know, he was the 34th Commandant. He’s on the board. And then you have a W three and two and three star generals on there. So these little groups that really work so hard to do for that too. I would like to take a percentage of my 50% Give it to them a percentage of the other goes back in the business. And I’ve already because this has a potential it’s a consumable, and it has a potential for a long term revenue stream for the funds. That’s not contingent on donations which have been flow. I’ve set up a trust fund, that when I when I pass 50% of the profits in perpetuity will go to the Semper Fi fund. So I’m hoping it’s something that I’m hoping it’s something that we never have to use going forward. But I’d be naive to say that, you know, Kumbaya, it’s not gonna happen,
Aaron Spatz 44:54
right? Yeah. Well, Matt like this has been this has been They’ve, like a true blast. And really like, I really appreciate you sharing your story like so just for people who want to learn more about you want to learn more about the military Java group, they can go to military, Java group.com. Is that right?
Matt Phillips 45:12
Correct. And jarhead java.com will bring you to the same, bring it to the same place. Awesome. And, and if Amazon is well at Java group, and
Aaron Spatz 45:25
that’s okay. And yeah, here’s your link profile. I just pulled that up. So if people want to get connected to you, that’s, that’s one way that they can do that. So
Matt Phillips 45:34
they only allow 30,000. And I’m tapped out.
Aaron Spatz 45:36
Oh, my gosh.
Matt Phillips 45:39
Which is a good thing. But I feel bad for people because I keep getting requests, and I can’t
Aaron Spatz 45:44
add them. Well, hopefully, then maybe through the Contact Us page on military Java group, then I’m sure there’s a way for you to get get some of those messages through there. So but
Matt Phillips 45:57
there’s no idea. I mean, again, I’m, I’m about as savvy with computers as Yeah.
Aaron Spatz 46:02
That’s awesome. But But man, I just, I really just want to thank you, thank you for thank you for what you do. And thank you for the for the contribution that you have made for the contributions that you are making. And yeah, I just hats off to you with all that you’re doing. I just I really, really appreciate you sharing, sharing some time with me this morning. Thank you so much.
Matt Phillips 46:21
Well, thank you for having me on. I appreciate it.
Aaron Spatz 46:26
Thanks for listening to America’s entrepreneur. If you enjoyed the show, please leave a review or comment on your preferred social media platform. share it out with friends, family, coworkers, others in your network. And of course, you can write me directly at aaron at Bold media.us. That’s a Ron at Bold media.us So thanks